Foot Locker’s total sales for Q1 fell by 4.5%, when foreign exchange rate fluctuations are excluded.
Foot Locker comparable sales saw a reduction of 2.6% during the quarter ended 3 May 2025, as comparable sales within North America experienced a marginal decline of 0.5% and international businesses faced an 8.5% drop, with Foot Locker Europe being particularly affected.
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The decline in sales emerge as Dick’s Sporting Goods confirmed a definitive merger agreement to acquire Foot Locker for an estimated $2.4bn.
Foot Locker chief executive officer Mary Dillon said: “We are continuing to execute our Lace Up Plan strategies as we look forward to the successful completion of our transaction with Dick’s Sporting Goods. As we noted at the time we reported preliminary first quarter results, we experienced softer traffic trends globally that impacted our performance.”
Foot Locker’s overall performance in Q1 FY25
Foot Locker registered a net loss of $363m in the first quarter of the fiscal, contrasting sharply with a net income of $8m in the same period last year. Adjusted for non-GAAP considerations, the net loss stood at $6m for the quarter, compared to a net income of $21m in the first quarter of FY24.
The company’s loss per share reached $3.81 in Q1 FY25, compared to earnings per share of $0.09 in Q1 FY24. On a non-GAAP basis, the loss per share was $0.07, against non-GAAP earnings per share of $0.22 in the prior-year period.
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By GlobalDataThe non-GAAP net loss and loss per share figures exclude non-cash impairment charges totalling $276m, which include significant charges such as a $140m tradename impairment and a goodwill impairment charge of $110m. Also excluded from non-GAAP results are a full valuation allowance on deferred tax assets and deferred tax costs related to certain European operations totalling $124m.
Gross margin contracted by 40 basis points compared to the previous year’s period. Merchandise margins dipped by 10 basis points and occupancy costs rose by 30 basis points as a percentage of sales.
Selling, general and administrative (SG&A) expenses as a percentage of sales increased by 100 basis points due to deleverage on reduced sales and investments in technology, despite cost optimisation efforts and ongoing expense management leading to a 0.7% decrease in SG&A dollars.
“During the quarter, we remained focused on the rollout of our Reimagined and Refresh programmes to elevate our in-store experience, enhancing our digital offerings, deepening customer engagement through our FLX programme and leveraging our strong brand partnerships to generate excitement for our customers. 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 and remaining disciplined with our cash flows,” Dillon added.
Foot Locker opened nine new stores but closed 56 locations during Q1 FY25, including exits from markets such as South Korea and several European countries.
The company also updated numerous stores to align with current brand design specifications.
As of 3 May 2025, Foot Locker operated 2,363 stores across various regions and had 236 licensed stores in operation. Notably, its Greece and Romania businesses transitioned to licensed partners in April 2025.
The company’s merchandise inventories were reported at $1.67bn as of the end of the quarter, showing a slight increase of 0.4% over the previous year’s first quarter end. However, adjusting for foreign currency impacts reveals a decrease of 0.7%.
Due to the pending acquisition of Dick’s Sporting Goods, Foot Locker has cancelled its scheduled conference call for discussing Q1 FY25 results and will not be issuing or updating any financial guidance.
