Foot Locker, Inc. has reported its financial results for the third quarter of 2024, and it's clear that the company faced several challenges during this period. Here’s a breakdown of the key metrics and how they have changed compared to the same quarter last year:
Total sales decreased by 1.4% year-over-year to $1,958 million, while comparable sales increased by 2.4%, including global Foot Locker and Kids Foot Locker comparable sales growth of 2.8%. However, Champs Sports and WSS banners also saw positive comparable sales growth of 2.8% and 1.8%, respectively.
Gross margin expanded by 230 basis points year-over-year, driven by reduced markdown levels. However, SG&A as a percentage of sales increased by 210 basis points, primarily due to technology and brand-building investments.
The company experienced a net loss of $33 million in the third quarter, compared to a net income of $28 million in the corresponding prior-year period. On a non-GAAP basis, net income was $31 million, compared to net income of $28 million in the corresponding prior-year period. The loss per share was $0.34, compared with earnings of $0.30 per share in the third quarter of 2023. Non-GAAP earnings were $0.33 per share, compared with non-GAAP earnings per share of $0.30 in the corresponding prior-year period.
Inventory decreased by 6.3% year-over-year to $1.7 billion, and the company opened 10 new stores, closed 24 stores, remodeled or relocated 20 stores, and refreshed 167 stores to updated design standards during the quarter.
The company’s full-year 2024 outlook has been updated, with sales change now expected to be -1.5% to -1.0% (compared to the prior guidance of -1.0% to +1.0%), and non-GAAP EPS now expected to be $1.20 to $1.30 (compared to the prior guidance of $1.50 to $1.70).
In light of these results, Foot Locker, Inc. is taking a more cautious view and lowering its full-year sales and earnings outlook due to a more promotional environment and softer consumer demand outside of key selling periods.
The company will host a conference call to review its third quarter 2024 results and provide an update on the business. An investor presentation will also be available on the investor relations section of the company’s corporate website.
The market has reacted to these announcements by moving the company's shares -11.7% to a price of $21.35. If you want to know more, read the company's complete 8-K report here.
