Foot Locker shares sprint higher after the sneaker retailer dropped mixed Q4 results
Foot Locker’s bottom line was good, but its outlook was not.
Shares of Foot Locker leapt over 8% after the footwear retailer posted its Q4 earnings results.
The good news: adjusted earnings per share hit $0.86, coming in well ahead of the $0.72 forecast from Wall Street. But the footwear giant missed on sales, reporting $2.24 billion, below the expected $2.32 billion. After a 2.6% rise in comparable sales, Foot Locker is bracing for a tough year ahead. Deep discounts, particularly from Nike (its biggest brand partner), are expected to weigh on profits in fiscal 2025. Meanwhile, rival Adidas expects an operating profit of $60 million in Q4, surprising analysts who were forecasting a loss.
Looking ahead, Foot Locker expects full-year adjusted EPS to be between $1.35 and $1.65, well below Wall Street’s $1.77 forecast. However, comparable sales could rise 1% to 2.5%, beating analysts’ expectations. Even as a sneaker slowdown looms, CEO Mary Dillon pointed to the company’s “Lace Up Plan” as a bright spot. The strategy, which focuses on revamping stores and shuttering underperforming locations, has helped improve margins and cash flow, according to the chief executive.
Foot Locker’s shares are down over 45% over the past year.
