Executive Summary

Q2 FY2024 net sales were $374.9M, down 4.6% YoY, with comparable sales -7.3%; diluted EPS was $0.85 as Hibbett reiterated full‑year FY2024 guidance, citing resilient footwear demand and a challenging, promotional environment .
Against public consensus context, EPS of $0.85 beat by $0.11 while revenue of $374.9M missed by $1.23M; S&P Global consensus was unavailable via our data tools (attempted retrieval) .
Gross margin contracted ~160 bps YoY to 32.8% on lower average product margins (~215 bps) and occupancy deleverage (~100 bps), partly offset by lower freight/logistics costs; SG&A deleveraged ~200 bps to 25.3% on lower sales and wage/incentive/medical/data costs .
Management reiterated FY2024 guidance first lowered in Q1 (EPS $7.00–$7.75, GM% 33.9–34.0, Op margin 7.4–7.8), and highlighted back‑to‑school strength, premium footwear consistency, and market share gains as catalysts heading into 2H (52% of annual sales expected in 2H) .

What Went Well and What Went Wrong

What Went Well

Strong start to back‑to‑school and positive response to new product launches; premium footwear remained consistent, supporting share gains in underserved markets (“we believe we continue to gain market share”) .
Guidance reaffirmed for FY2024 despite macro headwinds; management emphasized long‑term positioning and strong brand partnerships enabling compelling assortments .
Transcript tone underscored execution in a challenging environment with focus on omni‑channel initiatives to drive customer acquisition and engagement in 2H .

What Went Wrong

Comparable sales -7.3% YoY, with brick‑and‑mortar -7.7% and e‑commerce -5.2%; total net sales fell 4.6% YoY .
Gross margin contracted ~160 bps YoY (lower average product margin ~215 bps from elevated promotions; occupancy deleverage ~100 bps), and SG&A deleveraged ~200 bps on lower volume and wage/incentive/medical/data costs, compressing operating margin to 4.3% .
Inventory remained elevated YoY (+17.6%) though down slightly vs Q1; management expects continued promotions and more selective consumers at least through Q3 as inventory normalizes in 2H .

Financial Results

Metric	Q4 2023	Q1 2024	Q2 2024
Revenue ($USD Millions)	$458.3	$455.5	$374.9
Diluted EPS ($)	$2.91	$2.74	$0.85
Gross Margin %	35.2%	33.7%	32.8%
SG&A % of Sales	21.6%	21.1%	25.3%
Operating Margin %	11.1%	10.1%	4.3%
Comparable Sales %	+15.5%	+4.1%	-7.3%
E‑commerce as % of Sales	17.4%	13.7%	15.1%
Inventory ($USD Millions)	$420.8	$438.0	$430.8
End‑of‑Period Store Count (Units)	1,133	1,143	1,148

Estimates comparison (public context; SPGI unavailable):

Metric	Actual	Public Consensus	Beat/Miss
Revenue ($USD Millions)	$374.9	$376.1	Miss by $1.23M
Diluted EPS ($)	$0.85	$0.74	Beat by $0.11

Channel KPIs (Q2 vs prior year):

KPI	Q2 2023	Q2 2024
Brick & Mortar Comparable Sales %	- [not disclosed for Q2 2023]	-7.7%
E‑commerce Comparable Sales %	- [not disclosed for Q2 2023]	-5.2%
E‑commerce Penetration % of Sales	15.2%	15.1%

Notes: SPGI consensus was unavailable via GetEstimates for HIBB despite attempted retrieval; comparisons above use publicly available consensus context from Seeking Alpha.

Guidance Changes

Metric	Period	Previous Guidance (Q4 2023)	Updated Guidance (Q1 2024)	Current (Q2 2024)	Change
Total Sales (incl. 53rd week)	FY2024	Up mid‑single digit; 53rd week ~1%	Flat to up ~2%	Flat to up ~2%	Lowered in Q1; Maintained in Q2
Sales cadence by quarter	FY2024	~26%, ~22%, ~24%, ~28%	~26%, ~22%, ~24%, ~28%	~26%, ~22%, ~24%, ~28%	Maintained
Comparable Sales	FY2024	Up low‑single digit	Down low‑single digit	Down low‑single digit	Lowered in Q1; Maintained in Q2
Brick & Mortar	FY2024	Flat to up low‑single digit	Down low‑single digit	Down low‑single digit	Lowered in Q1; Maintained
E‑commerce	FY2024	Up high‑single digit	Down low‑single digit	Down low‑single digit	Lowered in Q1; Maintained
Net Store Growth (units)	FY2024	40–50	40–50	40–50	Maintained
Gross Margin %	FY2024	34.9%–35.0%	33.9%–34.0%	33.9%–34.0%	Lowered in Q1; Maintained
SG&A %	FY2024	23.2%–23.3%	23.3%–23.5%	23.3%–23.5%	Slightly raised in Q1; Maintained
Operating Profit %	FY2024	9.0%–9.3%	7.4%–7.8%	7.4%–7.8%	Lowered in Q1; Maintained
Interest Expense %	FY2024	0.25%–0.30%	0.40%–0.45%	0.40%–0.45%	Raised in Q1; Maintained
Diluted EPS	FY2024	$9.50–$10.00	$7.00–$7.75	$7.00–$7.75	Lowered in Q1; Maintained
Diluted Shares (mm)	FY2024	~12.7	~12.8	~12.8	Slightly raised; Maintained
Tax Rate	FY2024	24.0%	23.5%–23.7%	23.5%–23.7%	Lowered; Maintained
Capex ($M)	FY2024	$60–$70	$60–$70	$60–$70	Maintained
Dividend	Q2 FY2024	—	—	$0.25 declared Aug 22, payable Sep 19, 2023	Announced

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2023 and Q1 2024)	Current Period (Q2 2024)	Trend
Promotional environment & margins	Anticipated increased promotional activity; GM expected to decline 20–30 bps YoY in FY2024; step‑up in SG&A and interest expense	GM down ~160 bps YoY; lower product margins (~215 bps) from promotions; SG&A deleverage ~200 bps; reiterate guidance amid persistent promotions	Continuing pressure; near‑term headwind maintained
Consumer demand/macro (inflation, rates)	Softer consumer outlook, inflation and higher rates affecting discretionary spend; cautious FY2024 stance	Inflation/interest rate impacts highlighted; more selective consumer; uncertainty persists into 2H	Unchanged caution; focus on resilience
Footwear vs apparel performance	Premium footwear demand strong; apparel pressured in FY2023	Footwear remained consistent (premium brands); apparel demand softer amid heavy promotions	Footwear resilience; apparel softness persists
Inventory normalization	Inventory elevated; expected decline post back‑to‑school; debt higher in 1H	Inventory +17.6% YoY but down vs Q1; expect continued promotions/selective consumer through Q3 as inventory reduces in 2H	Progressing toward 2H normalization
Omni‑channel & e‑commerce	E‑commerce growth expected high‑single digit (initial guidance); platform investments	E‑commerce -5.2% comps; penetration 15.1%; renewed initiatives to acquire/engage customers and elevate retail experience	Mixed near‑term; ongoing strategic focus
Store growth in underserved markets	Net 40–50 new stores planned; footprint expansion	Q2 added 5 net new stores; reiterate 40–50 FY plan; market share gains referenced	Continuing execution

Management Commentary

“Our business model focuses on providing an exceptional consumer experience in underserved markets and produced solid financial results despite a challenging retail environment… strong start to the busy back‑to‑school season… positive customer response to new product launches… we believe we continue to gain market share.” — Mike Longo, CEO .
“Consumers have pulled back on discretionary spending… footwear sales, especially with our popular premium brands, have remained more consistent while our apparel business continues to reflect softer demand amid a heavy promotional environment… we are reiterating our previously stated guidance for the current fiscal year.” — Mike Longo, CEO .
“The business outlook for the remainder of fiscal 2024 remains challenging… inflation has continued to have a broad impact… interest rates have driven up the cost of borrowing… heavier promotional environment to continue for the near‑term… we feel our projected fiscal 2024 financial performance continues to be aligned… we are reiterating our overall guidance for fiscal 2024.” — Bob Volke, CFO .

Q&A Highlights

Inventory and promotions: Management expects continued promotions and a selective consumer through Q3 as inventory reduces; support from key brand partners to achieve inventory goals in 2H .
Channel performance: Women’s up mid‑single digits driven by strong footwear; men’s/kids down high‑single digits; e‑commerce comps -5.2% with penetration stable around mid‑teens .
Macro sensitivity: Inflation and higher rates impacting discretionary spend and operating costs; cautious but confident in long‑term positioning, reiterating guidance .
Seasonal/cultural drivers: Importance of sports seasons (e.g., college football) as events that drive traffic and engagement, consistent with brand and customer ethos .

Estimates Context

S&P Global consensus was unavailable via our data tools for HIBB for Q2 FY2024; we attempted retrieval but received a mapping error (GetEstimates failure).
Public consensus context indicates EPS beat (+$0.11) and revenue miss (-$1.23M) vs external estimates; use with caution in lieu of SPGI data .

Key Takeaways for Investors

Footwear resilience amid apparel softness: Premium footwear continues to anchor performance; apparel remains pressured by promotions—position sizing should reflect mix sensitivity .
Margin compression likely near‑term: GM pressure from promotions and occupancy deleverage plus SG&A inflation suggest cautious near‑term margin assumptions despite 2H sales weighting .
Guidance maintained at lowered levels: FY2024 EPS ($7.00–$7.75), GM% (33.9–34.0), and op margin (7.4–7.8) reiterated—model updates should key off these ranges and 2H cadence (~52% of sales) .
Inventory normalization is a 2H lever: Expect continued promotions into Q3 and inventory progress in 2H; watch working capital and interest expense sensitivity as debt remains higher earlier in the year .
Back‑to‑school strength is a tactical positive: Early quarter tailwind and new product launches supported Q2; monitor upcoming drop calendars and vendor allocations for 2H traffic catalysts .
Store growth intact: Net new stores 40–50 in FY2024; underserved market strategy and strong vendor relationships underpin share gains—medium‑term expansion supports top‑line .
Trading implications: Near‑term setup favors selective positioning given promotional headwinds and consumer caution; potential catalysts include premium footwear launches, inventory normalization, and sustained guidance confirmation .

Sources: Q2 FY2024 press release and financials (Form 8‑K, Exhibit 99.1) ; Q1 FY2024 press release and guidance update ; Q4 FY2023 press release, initial FY2024 guidance, and financials ; Q2 FY2024 earnings call transcript (public sources) .

HIBBETT INC (HIBB)·Q2 2024 Earnings Summary