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.

In a news release, CEO Mary Dillon said the company has made progress with its turnaround initiatives. She pointed to a new marketing deal with the NBA.

She said Foot Locker updated its outlook to reflect that momentum and capture “strong results over the Thanksgiving week period, against the backdrop of ongoing consumer uncertainty.”

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

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.

Foot Locker’s same-store sales fell 8% year over year, which the company said reflected “ongoing consumer softness,” a change in its mix of vendors and a 3% negative impact as it closes some Champs stores. Even so, that was slightly better than the 9.7% drop that analysts expected, according to FactSet.

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…