Dick’s Sporting Goods (DKS) Q4 2025 earnings

Dick’s sporting goods It said Thursday it had a better-than-expected holiday quarter, but the retailer issued weak earnings guidance for next year as its acquisition of Foot Locker continues to weigh on its bottom line.

The company expects fiscal 2026 adjusted earnings per share to range between $13.50 and $14.50, lower than analysts’ expectations of $14.67, according to LSEG.

Dick’s said it expects Foot Locker to return to profit and sales growth during the year, but it is still doing the costly work of liquidating old inventory and closing unproductive stores it acquired during last year’s merger.

The company expects these efforts, along with other expenses associated with the deal, to cost between $500 million and $750 million. About $390 million of those costs were recorded in fiscal year 2025, with more expected in the current fiscal year, she said.

In an interview with CNBC’s Sarah Eisen, CEO Ed Stack said the company was “basically accomplished” in its efforts to improve Foot Locker’s business.

“In retail, you never finish cleaning out the garage,” Stack said. “Anything else in the future is a normal course of action.”

Dick’s beat Wall Street expectations for both top and bottom line results for the three months ended January 31. Here’s how the company performed in the fiscal fourth quarter compared to what Wall Street expected, based on a survey of analysts conducted by LSEG:

• EPS: $3.45 was revised from $2.87 expected
• profit: $6.23 billion versus $6.07 billion expected

Dick’s reported net income of $128.3 million, or $1.41 per share, down 57% from $299.97 million, or $3.62 per share, a year earlier.

Sales rose to $6.23 billion, compared to $3.89 billion the previous year, when the company did not include Foot Locker.

Six months ago, Dick’s acquired Foot Locker in a $2.5 billion deal, and the combined entity is now one of the largest distributors of products from major athletic brands such as Nike, Adidas And the new balance. The merger gave Dick’s an opportunity with a new type of customer, allowed it to expand its international presence and gave it more negotiating power with brands at a time when sports apparel companies were becoming less dependent on wholesalers.

While the acquisition led to a 60% increase in sales during the fiscal fourth quarter, it also saddled Dick’s with a business that has underperformed for years and generates most of its revenue from a sprawling store footprint largely concentrated in malls.

Since its acquisition of the company, Dick’s has been closing underperforming stores. In fiscal 2025, it closed 57 stores globally across Foot Locker, Champs, Kids Foot Locker and WSS.

It has begun a pilot program with 11 Foot Locker stores dubbed “Fast Break” that will test changes to products and in-store presentation. So far, Dick said the pilot has delivered an “outstanding performance” with improved storytelling and presentation and a streamlined lineup. The retailer plans to expand the model later this year.

Prior to the acquisition, former Foot Locker CEO Mary Dillon was leading an aggressive store transformation strategy that sought to move stores to off-mall locations and renovate existing doors with a renewed concept. It is unclear whether Fast Break will be different from the Foot Locker strategy already underway.

Dick’s said it expects to see a turnaround in sales and profitability comparable to Foot Locker starting with the back-to-school shopping season. The company expects Foot Locker sales for the full year to grow by between 1% and 3%.