Dick’s Sporting Goods exceeded Wall Street’s expectations in its fiscal second quarter, reporting earnings per share of $4.37 compared to the expected $3.83. The company’s revenue also surpassed estimates, coming in at $3.47 billion versus the anticipated $3.44 billion. This performance comes at a time when several other retailers have issued cautious guidance for the rest of the fiscal year due to concerns about the upcoming presidential election and a potential slowdown in consumer spending.
CEO Lauren Hobart attributed Dick’s strong comparable sales growth to an increase in both transactions and ticket sizes. This suggests that more customers are visiting Dick’s stores and spending more during their visits. Comparable sales rose by 4.5%, surpassing analysts’ expectations of 3.6%.
Despite the impressive earnings, Dick’s revised its full-year guidance to a range of $13.55 to $13.90 per share, up from the previous guidance of $13.35 to $13.75. However, the new guidance fell slightly short of the $13.79 expected by analysts. While the company’s fiscal second-quarter earnings were 54 cents higher than expected, the midpoint of the revised guidance only increased by about 18 cents.
Dick’s also maintained its sales guidance of $13.1 billion to $13.2 billion, which disappointed analysts looking for $13.24 billion. However, the company did raise its projections for comparable sales growth to a range of 2.5% to 3.5%, up from the previous guidance of 2% to 3%. At the high end of the guidance, Dick’s is ahead of the estimated 3% growth.
Last week, Dick’s disclosed a cyberattack in a securities filing but stated that it did not believe the breach had a significant impact on its operations. The company activated its cybersecurity response plan and engaged external experts to investigate and isolate the threat. Despite this incident, Dick’s remains focused on its performance and is determined to overcome any challenges.
Notably, Dick’s faced difficulties last year when theft and aggressive markdowns affected its full-year profit expectations. However, the company seems to have overcome these issues, with profits rebounding this year. Other retailers, including Target and Walmart, have also reported a decrease in shrink, or lost inventory, due to investments in operations, technology, and reduced use of self-checkout machines.
Looking ahead, retailers are preparing for potential disruptions tied to the upcoming election and the Federal Reserve’s expected rate cut. These uncertainties could impact consumer spending on discretionary items. Dick’s will discuss its results and provide further insights during its analyst call at 8 a.m. ET.
