Foot Locker (FL) earnings Q3 2023

Shares of Foot Locker rose on Wednesday after the company posted surprise earnings and sales beats and said it saw strong results over Thanksgiving weekend.

The sneaker and sportswear retailer narrowed its full-year forecast, reflecting slightly better sales trends. It said it now expects sales to drop by 8% to 8.5% for the year, compared with a previously issued forecast of an 8% to 9% decrease. It projects a same-store sales decline of 8.5% to 9%, compared with its previous guidance of a 9% to 10% drop.

Yet Foot Locker lowered the high end of its adjusted earnings guidance, dropping the range to $1.30 to $1.40 per share, down from the previous $1.30 to $1.50 per share.

Here’s how Foot Locker did in the three-month period that ended Oct. 28 compared with what Wall Street was anticipating, based on a survey of analysts by LSEG, formerly known as Refinitiv:

• Earnings per share: 30 cents adjusted vs. 21 cents expected
• Revenue: $1.99 billion vs. $1.96 billion expected

Like many retailers, Foot Locker has gotten hurt by shoppers cutting back on discretionary spending as inflation forces them to spend more on food, housing and everyday needs and as experiences, rather than goods, become a priority. Foot Locker has also faced company-specific troubles, such as having some stores in struggling malls and leaning heavily on merchandise from Nike, a brand that’s making a bigger push to sell directly through its own stores and website.

In the fiscal third quarter, Foot Locker reported net income of $28 million, or 30 cents per share, compared with $96 million, or $1.01 in the year-ago period.

As of Tuesday’s close, shares of Foot Locker had tumbled by about 37% this year. That compares to the approximately 19% gains of the S&P 500 during the same period. Foot Locker’s stock closed at $23.84 on Tuesday, bringing its market value to $2.25 billion.

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