DICK'S Sporting Goods Cuts FY2026 Profit Outlook as Foot Locker Drags on Results Despite Strong Core Comps

DICK'S Sporting Goods lowered its fiscal 2026 adjusted earnings guidance after a second quarter in which the recently acquired Foot Locker banner weighed on results, even as the core DICK'S business kept growing at a healthy clip. According to Yahoo Finance, the company now expects adjusted earnings per share of $11.00 to $12.00 for fiscal 2026, down from a prior range of $13.50 to $14.50, and now sees the Foot Locker business swinging to a full-year operating loss.

What Changed in the Outlook

The revised guidance reflects a sharp swing in expectations for Foot Locker, which DICK'S recently acquired. Yahoo Finance reported that the company now expects the Foot Locker business to post an operating loss of $40 million to $80 million for fiscal 2026, a reversal from its prior forecast of $110 million to $150 million in operating profit.

According to the company's second-quarter earnings release, distributed via PR Newswire, Foot Locker comparable sales for fiscal 2026 are now guided to a range of negative 2.0% to 0.0%. Foot Locker net sales are guided to $7.4 billion to $7.5 billion. The DICK'S Business segment guidance was left largely intact: comparable sales of positive 2.5% to positive 4.0%, net sales of $14.5 billion to $14.7 billion, and segment profit of $1.54 billion to $1.60 billion, per the release.

Notably, Foot Locker's comparable sales figures are currently reported on a pro forma basis only. The company's release states that Foot Locker will not be included in the company's quarterly comparable sales calculation until the fourth quarter of fiscal 2026, and will not be part of full-year comparable sales until fiscal 2027.

Second-Quarter Results Trail Consensus

The quarter itself missed Wall Street expectations. Yahoo Finance reported adjusted earnings of $3.53 per share against a Zacks Consensus Estimate of $3.78, a shortfall of $0.25, or roughly 6.6%, by our calculation ($3.53 minus $3.78, divided by $3.78). Revenue of $5.59 billion also trailed the $5.63 billion consensus cited by Yahoo Finance, a gap of $0.04 billion, or about 0.7% below expectations by the same method.

The PR Newswire release shows earnings per diluted share fell to $3.53 from $4.38 a year earlier, a decline the release characterizes as down 19%. Profitability compressed broadly: GAAP operating income fell to 7.9% of net sales from 12.4% a year earlier, a drop of 451 basis points, while non-GAAP operating margin fell to 8.1% from 13.0%, down 491 basis points, according to the release.

Gross margin also weakened. The release reported GAAP gross profit margin of 34.78% versus 37.06% a year earlier. On an adjusted basis, Yahoo Finance reported consolidated gross profit of $1.9 billion, or 34.1% of sales, down 300 basis points year over year. Yahoo Finance attributed the decline to promotional activity, higher fuel and supply-chain costs, and the addition of the lower-margin Foot Locker business to the sales mix.

Foot Locker Integration Costs and Inventory Build

Expenses tied to the Foot Locker acquisition weighed heavily on the quarter. Yahoo Finance reported that adjusted selling, general and administrative expenses rose 65% to $1.4 billion, including $477 million tied to Foot Locker, while DICK'S also increased spending on World Cup-related marketing, digital initiatives and in-store experience investments.

Separately, the company disclosed ongoing charges from a review of unproductive Foot Locker assets. According to the earnings release, the company incurred $125.8 million in pre-tax charges during the 26 weeks ended August 1, 2026, bringing the cumulative total to $515.8 million. Management said in the release that it currently expects total pre-tax charges of up to $750 million, including $200 million in fiscal 2026, with the remainder to be incurred over the medium term.

Inventory also swelled following the acquisition. The release reported net inventories of $5,565 million, up 63% year over year, split between $3.6 billion for the DICK'S Business and $2.0 billion for the Foot Locker Business. Inventory tied strictly to the DICK'S Business rose a more modest 6% year over year, the release noted.

DICK'S Core Business Still Growing

Set against the Foot Locker weakness, the underlying DICK'S banner performance held up. The Globe and Mail reported that the core DICK'S Business posted 4.9% comparable sales growth in the quarter, aided by what the outlet described as robust World Cup-related demand. The Globe and Mail's coverage framed the guidance cut as driven specifically by weaker Foot Locker pro forma comps, margin pressure and earnings dilution from the acquisition, while management left DICK'S comparable-sales targets intact and adopted a more cautious near-term posture overall.

The board also maintained its dividend policy through the transition. On August 24, 2026, the company's board declared a quarterly dividend of $1.25 per share on common and Class B common stock, payable September 25, 2026, to holders of record as of September 11, 2026, according to both the company's release and the Globe and Mail's reporting.

Stock Performance and Peer Context

Yahoo Finance noted that DKS shares had lost 33.2% over the prior six months, compared with a 20.5% decline for its industry group, and that the stock carried a Zacks Rank #5 (Strong Sell) as of September 3, 2026.

On peer athletic brands, Yahoo Finance's Zacks-sourced commentary noted that Nike reported fiscal fourth-quarter 2026 wholesale revenues up 4% year over year, while NIKE Direct revenues fell 7%. The same commentary noted that Under Armour had recently updated its fiscal 2027 revenue expectations amid what its management described as a challenging consumer demand environment, while maintaining its full-year profitability outlook.

Bottom Line

DICK'S delivered a mixed second quarter: the core DICK'S banner grew comparable sales 4.9%, according to the Globe and Mail, while Yahoo Finance reported that the newly folded-in Foot Locker chain is now expected to post a fiscal 2026 operating loss of $40 million to $80 million, versus a prior forecast of $110 million to $150 million in operating profit. Interpreting those disclosed figures, that swing of roughly $150 million to $230 million in expected operating income ($110 million plus $40 million at the low end; $150 million plus $80 million at the high end) suggests much of the company's near-term earnings risk now sits with the Foot Locker banner rather than with the core DICK'S store base, where management left comparable-sales guidance intact at positive 2.5% to positive 4.0%.