Group 1 - The article discusses the author's previous hold rating on Academy Sports and Outdoors, Inc. (ASO), indicating a desire for more clarity on tariff situations and macroeconomic conditions [1] - The author emphasizes a diverse investment background, incorporating fundamental, technical, and momentum investing strategies to enhance their investment process [1] - The purpose of writing on Seeking Alpha is to track investment ideas' performance and connect with like-minded investors [1] Group 2 - There are no disclosed stock, option, or derivative positions in any mentioned companies, nor plans to initiate such positions within the next 72 hours [2] - The article expresses the author's personal opinions and is not compensated for it, aside from Seeking Alpha [2] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not reflect the platform's overall stance [3]

Question-and-Answer SessionThought we could start with just a high-level question, just how you would define the year of 2025 so far for Academy.Steven LawrenceCEO & Director It's been an interesting year. I mean, I guess, that's what you get when you work in retail, right? It feels like every time things start to normalize, something else comes along. So for us, listen, obviously, I think the backdrop of kind of the changing trade war has had some impact on how we're navigating on the flip side. We've got ...

Academy Sports & Outdoors (ASO) FY 2025 Conference September 04, 2025 01:10 PM ET Company ParticipantsKate McShane - Managing DirectorSteven Lawrence - CEO & DirectorEarl Carlton Ford IV - EVP & CFOKate McShaneOkay. Hi, everybody. Hi, Larry. How are you? Thanks for coming to the fireside chat with Academy.Today, we have with us Steve Lawrence, chief executive officer. Steve has served as CEO and on the Board of Directors since June 2023. We also have with us Carl Ford, Executive Vice President and Chief Fin ...

Financial Data and Key Metrics Changes - The company reported a positive comparable sales growth in Q2, with mid-single digits comp growth for new stores opened in the past couple of years [4][5] - E-commerce sales accelerated by nearly 18% in Q2 compared to Q1, indicating a strong performance in the online segment [5] - Gross margin increased by 30 basis points year-to-date, attributed to effective merchandising strategies [29] Business Line Data and Key Metrics Changes - The introduction of the Jordan brand has contributed to double-digit growth in the combined Nike and Jordan categories, with Jordan being a significant contributor [12] - The company has expanded its Nike assortment, increasing the square footage dedicated to Nike products by 10-15% in stores [21] - The company has seen a mid-teens acceleration in sales from customers earning over $100,000 annually, indicating a shift towards higher-income consumers [7][8] Market Data and Key Metrics Changes - Traffic from the lowest income quintiles (under $50,000) has declined in the high single digits, while the middle income quintile remains stable [6][7] - The company has successfully attracted higher-income customers, with a notable increase in sales from those making over $100,000 [7][8] Company Strategy and Development Direction - The company aims to sustain top-line growth and positive comparable sales through strategic initiatives and investments in new stores and e-commerce [27][33] - The focus remains on providing value, with a commitment to maintaining competitive pricing despite potential tariff impacts [28][29] - The company is exploring new brand partnerships and expanding its product offerings to enhance customer engagement and drive sales [25][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the consumer's resilience and the company's positioning to benefit from trade-down behavior among consumers [44][45] - The company anticipates that tariff impacts will become more pronounced in the second half of the year, but believes it can manage these challenges effectively [44][45] - There is a belief that the initiatives currently in place are gaining traction and will lead to sustained comparable sales growth [27][40] Other Important Information - The company has successfully pulled forward inventory to mitigate tariff impacts, resulting in an 8% increase in inventory dollars and a 4.5% increase in units on a per-store basis [50][52] - The capital allocation strategy includes share buybacks and investments in store expansion, with a focus on maintaining a strong balance sheet [42][43] Q&A Session Summary Question: What are the expectations for the environment in the second half of 2025? - Management expects the environment to remain the same, with potential for low single-digit inflation and resilient consumer behavior [44] Question: Have there been any elasticity responses to price increases? - The company has observed no unit erosion for certain items despite price increases, while some categories experienced unit fall-off when crossing price thresholds [46][47] Question: What are the expectations for inventory growth into the second half? - The company has pulled forward inventory and expects to manage inventory growth effectively, guiding for 20 to 25 new stores for the full year [50][51] Question: How does the company view margins outside of tariff costs? - Management sees upside opportunities in supply chain efficiencies and has implemented a new warehouse management system to improve operations [54][56] Question: What is the outlook on market share consolidation? - Management believes market share consolidation may accelerate, particularly among companies with weaker balance sheets facing tariff pressures [57]

Financial Data and Key Metrics Changes - The company reported a positive comparable store sales growth in Q2, with mid-single-digit increases in stores opened in the past couple of years [4] - E-commerce sales accelerated by nearly 18% in Q2 compared to Q1, indicating a strong performance in the online segment [4] - Gross margin improved by 30 basis points year-to-date, with expectations to be up 10 to 60 basis points for the full year [40][41] Business Line Data and Key Metrics Changes - The introduction of the Jordan brand has contributed to double-digit growth in the combined Nike and Jordan business [15] - The company has expanded its Nike assortment, increasing the square footage dedicated to Nike products by 10-15% across stores [28] - The company has seen a mid-teens acceleration in sales from customers earning over $100,000 annually, indicating a shift towards higher-income consumers [8] Market Data and Key Metrics Changes - Traffic from the lowest two income quintiles has decreased in high single digits, while the middle income quintile remains stable [6][7] - The company has successfully attracted higher-income customers, with a notable increase in sales from those making over $100,000 [8] Company Strategy and Development Direction - The company is focused on new store growth and has plans to expand the Jordan shop concept to all stores over the next two years [16] - The strategy includes a back-to-basics approach for the e-commerce platform, enhancing site functionality to improve customer experience [4] - The company aims to maintain its value proposition while navigating tariff impacts and adjusting pricing strategies accordingly [36] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about sustaining same-store sales growth, citing successful initiatives and a focus on value [35] - The company is prepared for potential price increases due to tariffs but believes its value offering will continue to attract customers [65] - Management noted that the consumer environment remains stable, with expectations of low single-digit inflation [64] Other Important Information - The company has pulled forward approximately $100 million in inventory at pre-tariff prices to mitigate tariff impacts [39] - The capital allocation strategy remains focused on stability, investing in growth initiatives, and returning value to shareholders through buybacks and dividends [62] Q&A Session Summary Question: Expectations for the consumer environment in FY '26 compared to FY '25 - Management indicated that the environment is expected to be similar, with potential price adjustments due to tariffs impacting consumer behavior [64] Question: Pricing elasticity response to price increases - Management noted varied responses to price increases, with some categories experiencing no unit erosion while others saw a negative reaction when crossing price thresholds [66][67] Question: Expectations for inventory growth in the second half - Inventory is up 8% in dollars and 4.5% in units per store, with adjustments made for unit buys in the second half [73] Question: Margins outlook outside of tariff costs - Management sees upside opportunities in supply chain efficiencies and has launched a new warehouse management system to improve operations [77] Question: Competitive landscape and market share consolidation - Management anticipates some consolidation in the market due to the hidden costs of tariffs affecting companies with weaker balance sheets [81]

Core Insights - Academy Sports and Outdoors, Inc. reported revenue of $1.6 billion for the quarter ended July 2025, reflecting a year-over-year increase of 3.3% but a slight miss of 0.67% against the Zacks Consensus Estimate of $1.61 billion [1] - The company's EPS for the quarter was $1.94, down from $2.03 in the same quarter last year, resulting in an EPS surprise of -8.49% compared to the consensus estimate of $2.12 [1] Financial Performance Metrics - Comparable Sales Growth was 0.2%, outperforming the six-analyst average estimate of -0.4% [4] - Total Merchandise Sales reached $1.59 billion, exceeding the two-analyst average estimate of $1.57 billion, with a year-over-year change of +3.3% [4] - Net Sales in the Merchandise Division for Outdoors was $448.94 million, surpassing the average estimate of $431.73 million, marking a year-over-year increase of +14.6% [4] - Net Sales for Sports and Recreation was $369.79 million, falling short of the average estimate of $382.84 million, representing a year-over-year decline of -8% [4] - Net Sales for Footwear was $323.24 million, slightly above the average estimate of $321.82 million, with a year-over-year increase of +3.6% [4] - Net Sales for Apparel was $451.12 million, exceeding the average estimate of $429.69 million, reflecting a year-over-year change of +3.3% [4] - Other Sales amounted to $6.75 million, significantly below the average estimate of $26.31 million, with a year-over-year change of +2.7% [4] Stock Performance - Shares of Academy Sports and Outdoors have returned +3.9% over the past month, slightly outperforming the Zacks S&P 500 composite's +3.8% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended August 2, 2025 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ___________ to ___________. Commission File No. 001-39589 Academy Sports and Outdoors, Inc. (Exact name of registrant as specified in its charter) (State or o ...

Financial Data and Key Metrics Changes - Net sales for Q2 were approximately $1.6 billion, up 3.3% year-over-year, with a comparable sales increase of 0.2% [24][26] - Gross margin was 36%, down 2 basis points from the previous year, while merchandise margin improved by 40 basis points [26][28] - Operating income was $172 million, and diluted earnings per share were $1.85, with adjusted earnings per share at $1.94 [27][28] - Inventory per store increased, with units per store up 4.6% and dollars per store up 8.2% [28] Business Line Data and Key Metrics Changes - The e-commerce channel saw a positive comparable sales increase of approximately 18% during Q2, building on a 10% increase in Q1 [24][10] - Performance across major business categories was consistent, with footwear, apparel, sports and recreation, and outdoor all showing low single-digit increases [10][11] - Seasonal categories like swim and summer footwear experienced a slow start but rebounded in late June and July [11] Market Data and Key Metrics Changes - Strong double-digit growth in foot traffic was observed among customers in the top two income quintiles (households making over $100,000) [12][13] - Traffic share remained flat among middle-income consumers (households making $50,000 to $100,000), while there was erosion in lower-income cohorts (households making less than $50,000) [12][13] - Market share data indicated meaningful gains across key businesses such as apparel, footwear, and sporting goods [13] Company Strategy and Development Direction - The primary growth strategy involves opening new stores, with three new locations opened in Q2, bringing the total to 306 stores across 21 states [15] - The company aims to grow its e-commerce business by improving site navigation, order fulfillment, and expanding product assortment [16][18] - Initiatives to enhance store productivity include adding desirable brands and implementing new technology like RFID scanners [19][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of inflation on consumer behavior, noting a trade-down effect among lower-income consumers [12][13] - The company remains optimistic about future performance, citing positive momentum and the effectiveness of strategic initiatives [30][31] - Management is closely monitoring tariff impacts and has implemented strategies to mitigate these effects [23][46] Other Important Information - The company has maintained strong liquidity with $300 million in cash and an undrawn $1 billion revolver [28] - Capital allocation remains disciplined, with investments in inventory, dividends, and strategic initiatives totaling approximately $148.7 million in Q2 [29] Q&A Session Summary Question: Insights on consumer behavior post back-to-school period - Management noted episodic shopping patterns and expressed optimism about momentum continuing into the remainder of the quarter [34][35] Question: Impact of tariff pricing on average ticket - Average unit retails (AURs) were up low to mid-single digits, with expectations for further price adjustments in the back half of the year [36][37] Question: Guidance on SG&A and operating leverage - Management indicated expectations for continued moderation of SG&A deleverage, with a focus on maintaining investment in growth initiatives [41][42] Question: Promotional environment and merchandise margin - The promotional environment remains competitive, with higher take rates observed during promotional events [84] Question: Performance of higher-income consumers - The top two income quintiles showed double-digit growth in traffic, offsetting declines in lower-income segments [86][87] Question: Expansion of Nike and Jordan assortments - The company has significantly expanded its Jordan brand assortment and is seeing strong performance from both Nike and Jordan products [92][100]

Financial Data and Key Metrics Changes - Net sales for Q2 2025 were approximately $1.6 billion, up 3.3% year-over-year, with a comparable sales increase of 0.2% [5][18] - Gross margin was 36%, down two basis points from the previous year, while merchandise margin improved by 40 basis points [19][20] - Operating income was $172 million, and diluted earnings per share was $1.85, with adjusted earnings per share at $1.94 [19][20] Business Line Data and Key Metrics Changes - The dot-com business grew approximately 18% during Q2, contributing positively to overall sales [5][18] - Performance across major categories was consistent, with low single-digit increases in footwear, apparel, sports and recreation, and outdoor categories [6][10] - Seasonal categories like swim and summer footwear experienced a slow start but rebounded in late June and July [6][10] Market Data and Key Metrics Changes - Strong double-digit growth in foot traffic was observed among consumers in the top two income quintiles (households making over $100,000) [8][9] - Traffic share remained flat in the middle-income segment ($50,000 to $100,000), while there was erosion in the lower-income cohort (under $50,000), though at a slower pace than in Q1 [9][10] Company Strategy and Development Direction - The company’s primary growth strategy includes opening new stores, with three new locations opened in Q2, bringing the total to 306 stores [10][11] - Focus on enhancing the dot-com business through improved site navigation, order fulfillment, and expanded product assortment [12][15] - Initiatives to improve existing store productivity include adding popular brands and implementing new technology like RFID handheld scanners [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the business momentum, particularly in light of positive comp sales and market share gains [10][23] - The company is closely monitoring consumer behavior in response to inflation and pricing adjustments, with a focus on maintaining a strong value proposition [8][32] - Future guidance indicates a tightening of the low end of comp sales expectations, now ranging from negative 3% to positive 1% for the year [22][23] Other Important Information - The company has taken measures to mitigate tariff impacts, including adjusting unit buys and optimizing pricing strategies [17][39] - Inventory levels are expected to normalize as the year progresses, with a current elevated inventory per store [20][22] Q&A Session Summary Question: Insights on consumer behavior post back-to-school period - Management noted continued episodic shopping patterns, with positive comps during back-to-school but a slight pullback afterward attributed to less clearance activity [26][27] Question: Impact of tariff pricing on average ticket - Average unit retails (AURs) were up low to mid-single digits, with expectations for further price adjustments in the back half of the year [29][30] Question: Guidance on SG&A and operating leverage - SG&A is expected to deleverage by approximately 100 basis points for the full year, with continued investments in growth initiatives [35][36] Question: Promotional environment and merchandise margin - The promotional environment remains competitive, with higher take rates on promotions, but merchandise margin has not significantly benefited from product mix changes [73][74] Question: Performance of higher-income consumers - The top two income quintiles showed double-digit traffic growth, which is expected to continue driving comp growth [75][76] Question: Expansion of Nike and Jordan assortments - The company has significantly expanded its Jordan assortment since launch, with plans for further expansion in the coming year [80][86]

Financial Data and Key Metrics Changes - Net sales for Q2 2025 were approximately $1.6 billion, an increase of 3.3% year-over-year, with a comparable sales increase of 0.2% [7][23] - Gross margin was 36%, down 2 basis points from the previous year, while merchandise margin improved by 40 basis points [24][10] - Operating income was $172 million, and diluted earnings per share were $1.85, with adjusted earnings per share at $1.94 [25][26] Business Line Data and Key Metrics Changes - The e-commerce channel saw a positive comparable sales increase of approximately 18% during Q2, building on a 10% increase in Q1 [8][23] - Performance across major categories was consistent, with footwear, apparel, sports and recreation, and outdoor categories all showing low single-digit increases [8][10] - Seasonal categories like swim and summer footwear experienced a slow start but rebounded in late June and July [9][10] Market Data and Key Metrics Changes - Strong double-digit growth in foot traffic was observed among consumers in the top two income quintiles (households earning over $100,000) [12] - Traffic share remained flat among middle-income consumers (households earning $50,000 to $100,000), while there was erosion in lower-income cohorts (households earning less than $50,000) [12][13] - Market share gains were noted across key businesses such as apparel, footwear, sporting goods, fishing, and outdoor cooking [12][13] Company Strategy and Development Direction - The company’s primary growth strategy includes opening new stores, with three new locations opened in Q2, bringing the total to 306 stores across 21 states [14] - The focus on enhancing the e-commerce business includes streamlining site navigation, improving order fulfillment, and expanding product assortment [15][20] - Initiatives to improve existing store productivity include adding desirable brands and implementing new technology like RFID scanners [17][18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of inflation on consumer behavior, noting a trade-down effect where consumers are seeking value [11][12] - The company remains optimistic about the momentum in the business, expecting continued positive trends in sales and market share [28][29] - Management is confident in their strategies to mitigate tariff impacts and maintain a strong value proposition for customers [22][46] Other Important Information - The company ended the quarter with $300 million in cash and maintained strong liquidity with an undrawn $1 billion revolver [26] - Free cash flow for Q2 was $21.7 million, with significant investments made in inventory and strategic initiatives [27] - The company has over $530 million remaining on its current share repurchase authorization [28] Q&A Session Summary Question: Insights on consumer behavior post back-to-school period - Management noted episodic shopping patterns and expressed optimism about momentum continuing into the remainder of the year despite a slight pullback after back-to-school [31][33] Question: Impact of tariff pricing on average ticket - Average unit retails (AURs) were up low to mid-single digits, with expectations for further price adjustments in the back half of the year [35][36] Question: Guidance on SG&A and operating leverage - Management indicated a commitment to disciplined spending, with expectations for SG&A deleverage to moderate in the back half of the year [40][50] Question: Promotional environment and merchandise margin - The promotional environment remains competitive, with higher take rates observed during promotional events, while merchandise margins are expected to benefit from a favorable mix [79][80] Question: Performance of higher income consumer segments - The top two income quintiles showed double-digit growth in traffic, which is expected to continue driving comp growth [81][83] Question: Expansion of Nike and Jordan assortments - The company has significantly expanded its Jordan brand assortment and is seeing strong performance from both Nike and Jordan products [87][90]