Dick’s Sporting Goods is expanding its House of Sport stores

As many retailers look for ways to reduce the number of stores and square footage, Dick’s sporting goods It’s going bigger.

The retailer is building more sprawling “House of Sport” stores, typically 120,000 to 150,000 square feet, more than double the 50,000 square feet at its traditional locations. The sporting goods company thinks it’s working.

“We needed to build the concept that would kill Dick’s Sporting Goods,” Edward Stack, CEO and son of founder Dick Stack, told CNBC in an exclusive interview at the Dick’s House of Sport store in Pittsburgh. “We needed to build the concept that if someone else built this store across the street from us, we would go out of business, and that’s exactly what we did.”

Because shoppers prioritize experiences and choice, locations allow Dick’s to meet them where they are. Most House of Sport stores have two-story climbing walls. Sports cages for bat testing; Field hockey and lacrosse sticks with statistical feedback; outdoor fields that double as ice skating rinks in the winter; And golf simulation.

Beyond the experiences, House of Sport has a dedicated shoe space three times the size of the old store, as well as 400 types of cleats in the House of Cleats section and other brands and merchandise exclusive to the concept.

“[House of Sport] A typical House of Sport store had annual sales of about $35 million across channels with an EBITDA and burn rate of about 20%, “so they are very, very productive,” Stack said.

Before opening the first House of Sport location, Stack said Wall Street thought the retailer should close stores and reduce its footprint.

“Their concept was, ‘I don’t really know how many stores you have, but you have a lot of them,’ or ‘I don’t really know how big your store is, but it’s too big, and you need to get smaller.'” “When I said to them, ‘Our philosophy is that in 10 years, we’ll probably have the same number of stores, and we’ll have a lot of space,’ but it didn’t do well, you know, and our inventory kind of stalled because of that,” Stack said.

But Stack was not dissuaded.

The retailer’s first “House of Sport” store opened in 2021, and the newest location in Jersey City, NJ outside of New York City debuted this month. Dick’s plans to have 35 stores by the end of the year and up to 100 by the end of its 2027 fiscal year, in addition to more than 850 stores across the Dick’s, Golf Galaxy, Field & Stream, Public Lands and Warehouse Sale banners.

There is a danger to this concept. Dick’s Sporting Goods CFO Navdeep Gupta said on earnings calls that it would take about $11.5 million in net capital expenditures to open a House of Sport store, a significant cost for a physical retailer at a time when more sales are shifting online.

Furthermore, most House of Sport locations are located in shopping malls, which face difficulties with shopper traffic. Recent examples show that even compelling experiential retail does not always translate into financial success and can be difficult to scale. These include the reimagined post-bankruptcy Toys R Us, Saks Fifth Avenue and Barneys. Nike has had mixed success with its large, pioneering experimental concepts.

The additional shelf space in House of Sport stores allows Dick’s to showcase more of its brand partners, both old and new. Nike, among others, liked the concept, Stack said.

“The Nike management team came and saw [House of Sport]”And they looked around and said: ‘This is absolutely the best expression of sport anywhere in the world.'”

While Nike works to rebuild other wholesale partnerships under new CEO Elliott Hill, “our relationship with Nike is great,” Stack said. In fact, House of Sport offers Nike’s Air Jordan and Kobe products that aren’t available anywhere else.

The correlation between experience and in-store product testing leads to merchandise sales, Stack said. “It’s not just that visit, but then they keep coming back,” he said, though he declined to share further metrics.

House of Sport’s main merchandise strategy is also to showcase newer, smaller and more premium brands such as Varley, Johnnie-O, Faherty, Marine Layer and others. There is also space for a shared laboratory, where brands are changed every 6 weeks or so. Currently, UK-based GymShark is using the rotation system to test sale in US retail.

While Dick’s goal doesn’t necessarily have to be to sell House of Sport’s proven brands in vintage stores as well, it could open up opportunity – or vice versa.

He recalled running the On brand, which began with the Dick’s Public Lands store format, when “to be honest with you, they were testing us to see what it was like to work with us,” Stack said. Four years later, On is now in nearly 450 Dick’s stores and is one of House of Sport’s “leading brands,” he added.

It’s not just brands that are interested in House of Sport. This concept also helps mall owners fill huge empty spaces that previously housed department stores.

“Mall developers love having us do it now that they understand what we do, because usually in a Sears wing, or a wing that has a department store that has been vacant for a while, that wing of the mall is not renting well to developers,” Stack said. Most House of Sport stores are located where Sears, Lord & Taylor or Nordstrom used to be in A or B rated malls.

Department stores aren’t the only risk Dick’s has taken that has drawn the wrath of Wall Street. Investors are not yet sold on Foot Locker’s $2.4 billion acquisition of the retailer.

“When we first made this acquisition, a lot of people didn’t like it,” Stack said. “Our stock took a hit, and we knew they wouldn’t like it.”

The deal was announced in May and closed on September 8, bringing the total number of Dick’s Sporting Goods stores across all banners to approximately 3,200 stores in 20 countries.

While Stack is leading the Foot Locker integration, Ann Freeman, formerly of Nike, is the new president of Foot Locker North America. As Dick’s expands its larger department store segment, shoes will be a critical component.

“The shoe is the engine that pulls the train, and everything in between [House of Sport footwear selection] And Foot Locker…it will end up being a really good investment for life,” Stack said.

Stack is invested in the company’s future. It remains the largest individual shareholder, with 13.3% of shares outstanding and 47% of voting power, according to the most recent proxy from April 2025.

But even as investors were disappointed with the Foot Locker deal, Dick’s shares outperformed the athletic brands it sells or competes with. While the average analyst rating is Overweight, the average price target is $241, just 6% higher than its current price.

Lululemon It lost more than half of its market value this year. Under the armor Down 42% year to date, On has lost 22% and Nike 9% in 2025.

Much of Dick’s Sporting Goods’ business focuses on youth sports. It’s a $40 billion annual market according to the Aspen Institute, with the average spending per child on a primary sport reaching $1,016 in 2024, up 46% in 2024 from 2019.

Stack often says his company is more insulated from macroeconomic pressures because of its younger athletic consumers, where parents don’t often shove their growing children’s feet into last year’s shoes. The replacement cycle likely contributed to 12 consecutive quarters of comparable sales growth for the retailer and the highest sales in the company’s history.

But innovation in products and sports has also led to increased sales across the Dick’s Sporting Goods business. For example, self-expression in baseball has recently driven demand for colorful baseball gloves, baseball bats and $105 batting gloves that are among House of Sport’s best-selling products.

“Innovation is more expensive” and “parents are preparing their kids, and they want to give their kids the best chance to succeed and do well,” Stack said.

Stack, who oversaw Dick’s’ massive expansion, also credits “the best management team we’ve ever had” and said “We never fall in love with ourselves… We’re happy with something we’ve succeeded at for about 15 minutes, and then we talk about it, ‘How can we make that better?’

Big expansion has been Stack’s modus operandi since he took over the two-location retail company his father started in 1948 and grew it into the $20 billion market cap company it is today. Taking risks, from new concepts to acquisitions, is also a core part of the DNA of the retailer created by Stack.

“Everything in a meeting starts with ‘Yes, if…’ and can never start with ‘No, because…’ and this has made a huge difference in our work,” he said.