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FL

FOOT LOCKER, INC. (FL)·Q1 2026 Earnings Summary

Executive Summary

  • Q1 2026 results: total sales $1.79B (-4.6% YoY), GAAP EPS loss of $3.81 and non-GAAP EPS loss of $0.07; comparable sales declined 2.6% (North America -0.5%, international -8.5%) .
  • Versus Street: EPS met consensus (-$0.07 vs -$0.07*) while revenue missed ($1.79B vs $1.857B*, ~$69M shortfall*); 17 EPS estimates and 15 revenue estimates contributed to consensus* .
  • No earnings call or guidance update due to pending acquisition by DICK’S Sporting Goods; management explicitly canceled the call and withheld guidance .
  • Stock reaction and narrative catalyst: mixed-to-soft quarter with revenue miss; immediate post-report trading was largely flat (~$23.94) per coverage . The merger announcement (May 15) reframed near-term investor focus on deal mechanics and integration .

What Went Well and What Went Wrong

What Went Well

  • Non-GAAP EPS aligned with consensus (-$0.07 vs -$0.07*)—avoiding an EPS downside despite softer traffic .
  • Strategic execution: 69 store refreshes and new mobile apps launched for Champs Sports and Kids Foot Locker, supporting customer experience modernization .
  • Management kept discipline around promotions, inventories, and expenses amid uncertain macro, suggesting operational tightening despite top-line pressure .
    • Quote: “As we have executed these and other initiatives… our teams have also remained nimble to navigate the uncertain macroeconomic environment, including managing our promotional levels, inventories, and expenses…” .

What Went Wrong

  • Revenue miss of ~$69M vs consensus, driven by softer traffic globally; international softness (Europe) led declines .
  • Significant GAAP impairment charges ($276M; $140M tradename and $110M goodwill) drove GAAP EPS loss of $3.81; tax valuation allowance also impacted reported loss .
  • Comparable sales declined 2.6% overall; international comps down 8.5% with Europe softness outpacing North America (-0.5%) .

Financial Results

MetricQ3 2025Q4 2025Q1 2026Consensus Q1 2026*
Revenue ($USD Billions)$1.96 $2.25 $1.79 $1.857*
GAAP Net Income ($USD Millions)-$33 $55 -$363 —
GAAP Diluted EPS ($USD)N/A$0.57 -$3.81 —
Non-GAAP Diluted EPS ($USD)N/A$0.86 -$0.07 -$0.0203*
Gross Margin (%)29.6 +300 bps YoY (detail in release) N/A in release—

Notes:

  • Company refers to “first quarter 2025” for the period ended May 3, 2025; S&P/aggregators reference “Q1 2026.” This recap uses Q1 2026 for comparability with consensus series.

KPIs and Comps

KPIQ3 2025Q4 2025Q1 2026
Comparable Sales (%)N/A (slowed late in quarter; see transcript commentary) +2.6 -2.6 (NA -0.5; International -8.5; Europe soft)
Store Refreshes (#)N/A160 (quarter); >400 for year 69 (quarter)
Mobile App LaunchesN/AFoot Locker app launched Nov 2024 (US) Launched new Champs Sports and Kids Foot Locker apps

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Overall financial guidance (sales, non-GAAP EPS)FY2025 (as provided Mar 5, 2025)Guidance issued with FY2025 outlook (specifics in Mar 5 release) No guidance provided or updated due to pending DICK’S transaction Suspended/withheld

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 2025)Previous Mentions (Q4 2025)Current Period (Q1 2026)Trend
Store modernizationContinued progress; gross margin recovery efforts; noted merchandising margin improvement 160 refreshes in Q4; >400 for year; focus on reimagined concepts and ROI 69 refreshes in Q1 Ongoing investment; cadence sustained
Digital & mobile appsN/AFoot Locker app launched Nov 2024; expansion plans to KFL & Champs New apps launched for Champs & Kids Foot Locker Scaling omnichannel tools
Macro/trafficDemand choppiness late Q3; cautious consumer Entered 2025 with momentum but prudence on promotions Softer traffic globally; comps down; international softness Traffic remains a headwind
Vendor/product mix (Nike and others)Pressure from weaker Nike demand; leaning on other brands Continued brand diversification and storytelling Not detailed (no call); international mix challenged Diversification ongoing; mix-sensitive
Merger with DICK’SN/AFY2025 outlook pre-dated merger announcement (Mar 5)Merger announced May 15; no call or guidance; focus shifts to deal process Transaction-driven narrative

Management Commentary

  • “Despite making ongoing progress with our Lace Up Plan, our preliminary first quarter results are below our expectations as we experienced softer traffic trends globally.” — Mary Dillon, CEO (May 15 preliminary press release) .
  • “As we have executed these and other initiatives to further advance our strategy, our teams have also remained nimble to navigate the uncertain macroeconomic environment, including managing our promotional levels, inventories, and expenses…” (Q1 results press release) .
  • “In light of the pending transaction with DICK’S, Foot Locker will not be holding its previously scheduled conference call…and will not be providing or updating previously issued financial guidance.” (Q1 results press release) .

Q&A Highlights

  • No Q1 2026 earnings call was held; management canceled the call and withheld guidance in light of the DICK’S transaction .
  • Recent context from prior quarter (Q4 2025) Q&A: CFO commentary supported a margin “algorithm” of ~60 bps EBIT improvement on 2–3% comp growth over the next few years as margins normalize, indicating confidence in recovery path (contextual, from Mar 5 event coverage) .

Estimates Context

  • Q1 2026 consensus EPS was -$0.0203*, actual non-GAAP EPS -$0.07; EPS met Street on a non-GAAP basis; 17 estimates contributed*. Revenue consensus $1.857B*, actual $1.79B; missed by ~$69M*; 15 estimates contributed* .
  • Given the revenue shortfall and international softness, near-term Street models likely temper top-line and international comp assumptions, while EPS revisions should reflect impairment-normalized non-GAAP loss path and lack of guidance.

Key Takeaways for Investors

  • Revenue miss and international softness (Europe) underscore ongoing traffic and category headwinds; North America comps showed relative resilience (-0.5%) .
  • Non-GAAP EPS aligned with consensus despite top-line miss—implies cost discipline and promotions management contained downside .
  • Large non-cash impairments skew GAAP optics; focus on non-GAAP trajectory and margin normalization post-refresh and merchandising actions .
  • No call/guidance due to merger—near-term stock drivers tied more to deal timing, consideration election mix, and integration synergies than quarterly operating cadence .
  • Store modernization and new mobile apps signal continued omnichannel uplift investments; watch KPIs (refresh count, app adoption) for conversion/traffic improvements .
  • International remediation (esp. Europe) is a key medium-term lever; monitor merchandising, brand mix, and localized marketing to close performance gap .
  • Short-term: trading likely range-bound pending deal developments; Medium-term: thesis hinges on DICK’S integration, synergy capture ($100–$125M medium-term target per DICK’S release), and margin normalization trajectory .

Appendix: Prior Year Comparison (Q1 2025 vs Q1 2026)

MetricQ1 2025 (Company)Q1 2026 (Company)
Revenue ($USD Billions)$1.874 $1.79
GAAP Diluted EPS ($USD)$0.09 -$3.81
Non-GAAP Diluted EPS ($USD)$0.22 -$0.07
Comparable Sales (%)N/A-2.6 (NA -0.5; International -8.5)

Additional Primary Sources

  • Preliminary results 8‑K/press release (May 15, 2025) .
  • Acquisition announcement (May 15, 2025) .

Values marked with * were retrieved from S&P Global.