Dick’s Sporting Goods, which posted third-quarter results on Tuesday, is making changes at its Foot Locker operation.
Dick’s said on Tuesday that it has named Matthew Barnes as president of Foot Locker International, effective Dec. 3. Barnes will report to Dick’s executive chairman Ed Stack, as well as join Foot Locker’s management team, including former Nike executive Ann Freeman, who leads Foot Locker North America.
That’s not the only change at Foot Locker. More are on the way, according to Stack.
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“At Foot Locker, we’ve assembled a world-class management team and are taking decisive actions to ‘clean out the garage’ by clearing unproductive inventory, closing underperforming stores and laying the foundation for a fresh start in 2026,” the executive chairman said. He added that the changes, combined with Dick’s operational expertise and strong vendor relationships, will position the Foot Locker business “for profitable growth.”
Dick’s completed its $2.5 billion acquisition of Foot Locker this past September. Dick’s said on Tuesday that total consideration exchanged for the transaction was $2.1 billion for the issuance of 9.6 million shares of Dick’s Sporting Goods common stock, $223.0 million in cash and $111.6 million from Dick’s pre-existing equity ownership in Foot Locker.
Foot Locker didn’t say how many stores would close. There’s been speculation over what the future might bring for Champs Sports, WSS and Atmos, while the expectation is that the core Foot Locker and Kids Foot Locker banners would become core to Dick’s portfolio umbrella. And earlier this month, word surfaced that Foot Locker was no longer moving its headquarters to Florida.
Whether the latest update answers what Wall Street wants to know about the future of Foot Locker under Dick’s ownership remains to be seen. With a review underway, more in-depth information might not be known until early next year when Dick’s reports fourth-quarter and full-year results.
Wall Street has been positive on the Dick’s/Foot Locker deal, believing that the latter would benefit from the operational expertise of the much larger sporting goods retailer. They also believe that the deal is a positive for the Nike brand, in the midst of its own turnaround initiative, which has strong partnerships with both retailers.
For the third quarter ended Nov. 1, Dick’s reported net income of $75 million, or 86 cents a diluted share, versus net income of $228 million, or $2.75, in the same year-ago period. On an adjusted basis, diluted earnings per share was $2.07. Net sales rose 36.3 percent to $4.17 billion from $3.06 billion. Comparable sales at Dick’s business was up 5.7 percent on top of a 4.3 percent gain a year ago. The company said it will not provide quarterly comparable sales for Foot Locker until the fourth quarter of fiscal 2026, when the stores will have a full 14 months of operations following the September acquisition.
Dick’s missed Wall Street’s expectations for earnings per share of $2.71, as well as revenue of $4.43 billion.
For the nine months, net income was $721 million, or $8.66 a diluted share, versus net income of $865 million, or $10.43, a year ago. Net sales were up 15.1 percent to $10.99 billion from $9.55 billion.
During the quarter, Dick’s opened 13 new House of Sport stores and six new Dick’s Field House locations.
Despite the earnings miss, which sent Dick’s shares down 3.6 percent to $199.00 in pre-market trading, the retailer raised full-year 2025 guidance for comparable sales growth for the Dick’s business to a range of 3.5 percent to 4.0 percent, up from its prior guidance of 2.0 percent to 3.5 percent when the retailer posted second-quarter results in August. It also raised full-year 2025 diluted earnings per share forecast for the Dick’s business to the range of $14.25 to $14.55, up from prior guidance of $13.90 to $14.50. Net sales are expected to reach between $13.95 billion and $14.0 billion.
“In the third quarter, the Dick’s business comps grew 5.7 percent driven by increases in both average ticket and transactions, and we were pleased to deliver gross margin expansion,” said the company’s president and CEO Lauren Hobart. “Reflecting these strong results and our continued confidence, we are again raising our full-year 2025 outlook for the Dick’s business.”
