Financial Data and Key Metrics Changes - Total sales decreased by 5.8%, primarily due to the lapping of the 53rd week in 2023, foreign currency headwinds, and store closures [66] - Comparable sales increased by 2.6%, in line with expectations, marking the third consecutive quarter of positive comps [66] - Gross margin expanded by 300 basis points year-over-year to 29.6%, exceeding revised expectations [68] - Non-GAAP earnings per share were $0.86, above the guidance of $0.70 to $0.80 [10][66] Business Line Data and Key Metrics Changes - Global Foot Locker and Kids Foot Locker banners led comp sales growth with an increase of 3.6% [8][66] - Champs Sports experienced a 1.8% increase in comps, marking the second consecutive quarter of positive growth since repositioning [9][58] - Apparel business faced challenges with mid-teen comp declines, while accessories saw high single-digit growth [50][52] Market Data and Key Metrics Changes - North America comps were up 3.6%, with Foot Locker North America banner achieving a 5.5% increase [55] - European comps increased by 1.9%, despite a competitive and promotional environment [62] - Asia Pacific comps fell by 7.6%, with Foot Locker banner down 7.2% due to competitive dynamics and inflation [63][64] Company Strategy and Development Direction - The company is focused on executing the Lace Up Plan, which includes enhancing customer experience through store refreshes and digital improvements [11][19] - Plans to optimize the real estate portfolio by closing underperforming stores and converting select markets to a license model [15][26] - The company aims to deepen customer relationships through loyalty programs, with FLX Rewards penetration reaching 49% of sales in North America [32][33] Management's Comments on Operating Environment and Future Outlook - Management noted increased consumer caution and sensitivity, impacting business performance in early 2025 [16][17] - The company expects ongoing comp sales growth and margin expansion in 2025, despite recognizing consumer uncertainties [72][73] - Management remains confident in the execution of the Lace Up Plan and the potential for profitable market share gains [85] Other Important Information - The company achieved $100 million in savings as part of a $350 million cost savings plan, exceeding expectations [15][69] - The company plans to refresh approximately 300 stores in 2025, building on over 400 refreshes completed in 2024 [28][29] - Digital penetration increased to 21.8% of sales, with a target of 25% by 2026 [36] Q&A Session Summary Question: Can you provide more color on what you're seeing quarter-to-date regarding consumer behavior? - Management observed that while consumers respond positively to exciting promotions, there is increased caution in between these periods, particularly among younger demographics [90][92] Question: What are the expectations for Nike's performance in the near term? - Management expressed confidence in the partnership with Nike, noting that they are focused on long-term strategies and growth plans, despite some short-term promotional challenges [113][114] Question: Why aren't there bigger cost savings reflected in SG&A? - Management acknowledged that while progress has been made, the current SG&A rate is not supportive of long-term profit targets, and they will continue to work on lowering it [99][100]

Core Viewpoint - Foot Locker's stock surged after the company reported better-than-expected financial results for its fiscal fourth quarter of 2024, indicating a positive market reaction to its performance despite a challenging retail environment [1][2]. Financial Performance - Foot Locker's Q4 same-store sales increased by nearly 3% year over year, and the gross margin showed significant improvement [2][4]. - For fiscal 2025, the company anticipates same-store sales growth of 1% to 2.5% and expects gross margin to rise to a range of 29.3% to 29.7%, up from 29% in 2024 [4]. Market Environment - The shoe retail market is currently very promotional, with consumers seeking bargains, which typically poses challenges for retailers [3]. - Despite the promotional environment, Foot Locker managed to grow sales at existing stores without resorting to promotions that could negatively impact margins [3]. Store Strategy - Foot Locker has been closing underperforming stores, having closed 47 stores in Q4 alone, and plans to reduce its store count by approximately 4% in 2025, equating to nearly 100 additional closures [5]. - While closing stores may shrink the company's size, it is viewed as a necessary strategy to improve overall performance and profitability [6].

Core Insights - Foot Locker reported revenue of $2.25 billion for the quarter ended January 2025, a decrease of 5.7% year-over-year, and an EPS of $0.86, up from $0.38 in the same quarter last year [1] - The revenue fell short of the Zacks Consensus Estimate of $2.33 billion by 3.42%, while the EPS exceeded the consensus estimate of $0.73 by 17.81% [1] Financial Performance Metrics - Comparable store sales increased by 2.6%, surpassing the average estimate of 2% from six analysts [4] - Total number of owned stores at the end of the period was 2,410, slightly below the average estimate of 2,421 from three analysts [4] - Total gross square footage was reported at 12,751 Ksq ft, marginally lower than the estimated 12,759.37 Ksq ft [4] - The number of stores for Kids Foot Locker was 369, compared to the average estimate of 377 [4] - Foot Locker U.S. had 677 stores, slightly above the average estimate of 676 [4] - Foot Locker Europe had 608 stores, below the average estimate of 620 [4] - Sales were reported at $2.24 billion, lower than the average estimate of $2.34 billion from two analysts [4] - Licensing revenue was $5 million, exceeding the average estimate of $3.50 million from two analysts [4] Stock Performance - Foot Locker's shares have returned -9.4% over the past month, compared to a -4.1% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Core Insights - Foot Locker Inc reported mixed fourth-quarter earnings, with adjusted earnings of 86 cents per share exceeding analyst expectations of 72 cents, while revenue of $2.24 billion fell short of the forecasted $2.32 billion, reflecting a 4.6% year-over-year decline excluding currency fluctuations [1] Financial Performance - The company experienced a 2.6% increase in comparable-store sales, indicating some resilience in its retail operations, although the fourth quarter of 2023 included an extra week, which affected year-over-year comparisons [2] - The stock price of Foot Locker rose by 10.1% to $19.21, after reaching an intraday high of $19.67, despite struggling in 2025 with a year-to-date decline of 12.1% and a year-over-year decline of 43.8% [2] Market Activity - Options traders are actively speculating on Foot Locker's stock movements, with a significant volume of 5,564 calls and 4,406 puts exchanged, which is seven times the average intraday volume, indicating heightened interest in the stock [3] - The most popular options contracts include the 3/7 20-strike call and the 17.50-strike put in the same weekly series [3]

Core Viewpoint - Foot Locker reported quarterly earnings of $0.86 per share, exceeding the Zacks Consensus Estimate of $0.73 per share, and showing significant growth from $0.38 per share a year ago, indicating a strong earnings surprise of 17.81% [1][2] Financial Performance - The company posted revenues of $2.25 billion for the quarter ended January 2025, which was 3.42% below the Zacks Consensus Estimate and a decline from $2.38 billion in the same quarter last year [2] - Over the last four quarters, Foot Locker has surpassed consensus EPS estimates three times but has only topped revenue estimates once [2] Stock Performance - Foot Locker shares have declined approximately 20.2% since the beginning of the year, contrasting with the S&P 500's decline of 1.8% [3] - The current Zacks Rank for Foot Locker is 4 (Sell), indicating expectations of underperformance in the near future [6] Earnings Outlook - The consensus EPS estimate for the upcoming quarter is $0.35 on revenues of $1.91 billion, while the estimate for the current fiscal year is $1.71 on revenues of $8.22 billion [7] - The trend of estimate revisions for Foot Locker has been unfavorable leading up to the earnings release [6] Industry Context - The Retail - Apparel and Shoes industry, to which Foot Locker belongs, is currently ranked in the top 26% of over 250 Zacks industries, suggesting a favorable industry outlook [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Foot Locker's stock performance [5]

❖ Foot Locker, Inc. FOURTH QUARTER 2024 EARNINGS RESULTS MARCH 5,2025 m CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS We do not intend to publiclu update or revise any foruard-locking statements as a result of new information. future events, changes in circumstances, or otheruise. These c statements qualify all foruward-locking statements attributable to us, or persons acting on our behalf. Nanagement cautions quot hat the forward-looking statements contain re not quarantees of future performance, an ...

Core Viewpoint - Foot Locker Inc. shares are declining towards an 18-month low despite improving sales and profitability, as the company provided cautious guidance due to economic uncertainties affecting consumer spending [1] Sales Performance - Comparable sales, which reflect sales from stores open for more than a year, have increased for the third consecutive quarter [1] - The company has implemented strategies to enhance in-store experiences, contributing to this sales growth [1] - Foot Locker expects to see another full year of growth in comparable sales [1]

Financial Performance - Total sales for Q4 2024 decreased by 5.8% to $2,243 million compared to $2,380 million in Q4 2023, with a foreign exchange impact leading to a 4.6% decrease when adjusted[4]. - Comparable sales increased by 2.6%, with global Foot Locker and Kids Foot Locker combined comparable sales growth of 3.6%[5]. - Net income from continuing operations was $55 million, a significant recovery from a net loss of $389 million in the prior-year period[11]. - Non-GAAP EPS for Q4 2024 was $0.86, compared to $0.38 in the corresponding prior-year period[11]. - In Q4 2024, the company reported a pre-tax income of $77 million, a significant improvement from a loss of $524 million in Q4 2023[25]. - Adjusted net income (non-GAAP) for Q4 2024 was $82 million, compared to $36 million in Q4 2023, reflecting a 127.8% increase[25]. - The company achieved earnings per share (EPS) of $0.51 in Q4 2024, recovering from a loss of $4.13 per share in Q4 2023[25]. - Net income for 2024 was $12 million, a significant improvement from a net loss of $330 million in 2023[35]. Sales and Store Operations - The full-year 2025 sales outlook is projected to change between -1.0% to +0.5%, with comparable sales expected to grow by 1.0% to 2.5%[13]. - The company completed 160 store refreshes in Q4, bringing the total to over 400 for the year[5]. - The company plans to close all stores in South Korea, Denmark, Norway, and Sweden as part of its strategy to improve international operations[26]. - Total store count as of February 3, 2024, was 2,523, with 26 new stores opened and 139 closed[37]. - Foot Locker U.S. selling square footage decreased from 2,401 thousand in February 2024 to 2,337 thousand in February 2025[37]. - Foot Locker Europe had a total of 637 stores as of February 3, 2024, with 10 new stores opened and 39 closed[37]. Financial Position - Cash and cash equivalents increased to $401 million as of February 1, 2025, up from $297 million a year earlier[33]. - Total liabilities decreased to $3.839 billion as of February 1, 2025, compared to $3.978 billion a year earlier[33]. - The company’s total shareholders' equity increased to $2.909 billion as of February 1, 2025, compared to $2.890 billion a year earlier[33]. - Net cash provided by operating activities increased to $345 million in 2024, compared to $91 million in 2023[35]. - Total cash, cash equivalents, and restricted cash at the end of the period increased to $430 million from $334 million in the previous year[35]. Capital Expenditures and Investments - The company plans to focus on customer-facing investments, with capital expenditures estimated at $270 million for 2025[13]. - Capital expenditures for 2024 were $240 million, slightly down from $242 million in 2023[35]. - Net cash used in investing activities was $240 million in 2024, compared to $222 million in 2023[35]. - The company recorded a $35 million impairment charge related to a minority investment during fiscal year 2024[29]. - The company reported a fair value adjustment loss of $35 million on minority investments in 2024, compared to a loss of $478 million in 2023[35]. Inventory and Merchandise - Merchandise inventories increased by 1.1% year-over-year to $1,525 million, with a 2.5% increase when excluding foreign currency fluctuations[8]. - For fiscal year 2024, the company incurred $32 million in impairment charges related to underperforming stores and $26 million in reorganization costs for headquarters relocation[27].

Core Viewpoint - Foot Locker anticipates continued deep discounts in the sneaker industry as Nike, its largest brand partner, works through inventory challenges, impacting Foot Locker's sales and profit expectations for fiscal 2025 [1][6]. Financial Performance - Foot Locker reported a net income of $49 million, or 51 cents per share, for the fiscal fourth quarter, a significant improvement from a loss of $389 million, or $4.13 per share, a year earlier [3]. - Sales for the quarter decreased to $2.25 billion, down nearly 6% from $2.38 billion a year prior, influenced by an extra week of sales in the previous year [4]. - Adjusted earnings per share for the current fiscal year are expected to be between $1.35 and $1.65, falling short of Wall Street's estimate of $1.77 [5]. Sales Expectations - Foot Locker anticipates comparable sales growth of 1% to 2.5%, with the high end exceeding analysts' expectations of 1.9% [5]. - The company expects promotional pressures to continue affecting margins, particularly in the first half of 2025 [6]. Brand Partnership Challenges - Foot Locker's performance is closely tied to Nike, which represents about 60% of its sales. Nike's current strategy involves deep discounting to clear out old inventory, which negatively impacts Foot Locker's business [6][7]. - There is a disparity in pricing strategies, as Nike offers discounts on its website while Foot Locker maintains full prices for certain models, potentially driving customers to purchase directly from Nike [8][9].

Total Sales Down 5.8% Year-over-Year and Comparable Sales Up 2.6% Global Foot Locker and Kids Foot Locker Comparable Sales Up 3.6% Gross Margin Expansion of 300 Basis Points Year-over-Year GAAP EPS of $0.57 from Continuing Operations and Non-GAAP EPS of $0.86 Completed 160 Store Refreshes in the Quarter, Bringing Total to Over 400 for the Year Issues Full-Year Sales and Non-GAAP EPS Outlook NEW YORK, March 5, 2025 /PRNewswire/ -- Foot Locker, Inc. (NYSE: FL) today reported financial results for its fou ...