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DICK'S Sporting Goods, Inc. DKS posted second-quarter fiscal 2025 results, wherein the top and bottom lines beat the Zacks Consensus Estimate. Both sales and earnings improved from the prior-year figures.
DICK’S Sporting delivered strong second-quarter results with higher sales and comparable growth, supported by gains in both transactions and average ticket. The company expanded gross margin, reflecting improved profitability, and continued to invest in new store formats. Management raised its full-year outlook on the back of this momentum and reaffirmed confidence in its strategies, while also progressing toward the planned Foot Locker acquisition.
Adjusted earnings per share (EPS) of $4.38 increased by a penny from the year-ago figure of $4.37. Also, the bottom line beat the Zacks Consensus Estimate of $4.29.
DICK'S Sporting Goods, Inc. price-consensus-eps-surprise-chart | DICK'S Sporting Goods, Inc. Quote
The company’s shares have gained 20% in the past three months compared with the industry’s growth of 21.6%.
Net sales of $3.65 billion improved 5% year over year and surpassed the consensus estimate of $3.59 billion. The upside was driven by robust comps and healthy transaction growth. DKS continued gaining market share from online-only and omnichannel retailers.
Consolidated comps grew 5% year over year, backed by a 4.1% rise in average ticket and a 0.9% jump in transactions. Our model estimated comps to grow 2.7%. This reflects almost a 9.5% two-year comp stack and an 11.5% three-year comp stack.
Gross profit rose 5.9% year over year to $1.35 billion and surpassed our estimate of $1.31 billion. Meanwhile, the gross margin expanded 33 basis points (bps) year over year to 37.1%. This growth was primarily led by increased merchandise margin and leverage on occupancy costs from higher sales.
The adjusted SG&A expense rate of 23.7% rose 110 bps year over year. Adjusted SG&A expenses, in dollar terms, grew almost 9.9% year over year to $864 million and were higher than our estimate of $848.1 million.
DICK’S Sporting ended the fiscal second quarter with cash and cash equivalents of $1.2 billion and no outstanding borrowings under the revolving credit facility. It had a total debt of $1.5 billion as of Aug. 2, 2025. Total inventory rose 7.1% year over year.
This Zacks Rank #3 (Hold) company repurchased 1.4 million shares under its share repurchase program for $299 million in the 26 weeks ended Aug. 2, 2025. It had $212.9 million remaining under its authorization as of the same date. DKS also paid $5 million in fiscal 2025 for shares repurchased in the prior fiscal year.
It paid quarterly dividends of $196 million for the 26 weeks ended Aug. 2, 2025. On Aug. 27, 2025, the company's board announced a quarterly cash dividend of $1.2125 per share on its common stock and Class B common stock. This is payable Sept. 26, 2025, to its stockholders of record as of Sept. 12.
During the second quarter, the company introduced one House of Sport location and four DICK'S Field House locations.
On May 15, 2025, DICK’S Sporting Goods entered into a definitive merger agreement to acquire Foot Locker, Inc., a leading footwear and apparel retailer, in a transaction valued at approximately $2.5 billion. The deal has already received shareholder and regulatory approvals, with closing expected on Sept. 8, 2025. Management highlighted this acquisition as a major strategic milestone that will create a global leader in the sports retail industry, broaden its consumer reach, and strengthen partnerships with top athletic brands. The company reiterated that the transaction is expected to be accretive to earnings per share in the full fiscal year post-close and to deliver $100-$125 million in cost synergies over the medium term, primarily from procurement and sourcing efficiencies. DICK’S Sporting also expects to leverage Foot Locker’s deep sneaker expertise and cultural relevance through its well-established portfolio of banners.
DICK’S Sporting raised its full-year fiscal 2025 guidance following a strong second-quarter performance, which does not include acquisition-related expenses, investment losses or results from the pending deal to acquire Foot Locker. Management now expects comparable sales growth in the low single digits and earnings per share toward the higher end of prior guidance.
It projects net sales in the band of $13.75-$13.95 billion compared with $13.4 billion recorded last fiscal. The company expects comps growth of 2-3.5%, up from the 1-3% mentioned earlier.
DKS continues to envision earnings to be $13.90 to $14.50 per share compared with prior expectations of $13.80 to $14.40. Management anticipates gross margin expansion supported by favorable product mix, brand partnerships, and contributions from GameChanger and the DICK’S Media Network. Operating margin is expected to be around 11.1%, with a potential 10 basis points of expansion at the high end. Capital expenditures are planned at roughly $1.2 billion gross and $1.0 billion net, with $65 million to $75 million in pre-opening expenses concentrated in the fiscal third quarter to support the largest-ever rollout of 13 House of Sport and 6 Field House stores.
Some top-ranked stocks are Levi Strauss & Co. LEVI, Genesco Inc. GCO and Torrid Holdings CURV.
Levi designs and markets jeans, casual wear and related accessories for men, women and children. It flaunts a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Levi’s current fiscal-year earnings indicates growth of 4% from the year-ago actual. LEVI delivered a trailing four-quarter average earnings surprise of 25.9%.
Genesco operates as a retailer and wholesaler of footwear, apparel and accessories, and currently carries a Zacks Rank of 2 (Buy). GCO delivered a trailing four-quarter earnings surprise of 28.1%, on average.
The Zacks Consensus Estimate for Genesco’s current fiscal-year earnings and sales indicates growth of 65.9% and 1.5%, respectively, from the year-ago period’s reported figures.
Torrid Holdings currently carries a Zacks Rank #2. The Zacks Consensus Estimate for Torrid Holdings’ 2025 sales and EPS indicates a decrease of 5.6% and 6.7%, respectively, from the year-ago period’s levels. CURV delivered a trailing negative four-quarter average earnings surprise of 10.5%.
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This article originally published on Zacks Investment Research (zacks.com).
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