Foot Locker(FL) - 2026 Q1 - Quarterly Results

Financial Performance - Comparable sales decreased by 2.6% from the prior-year period, with North America region sales decreasing by 0.5%[5] - Net loss is expected to be $363 million, compared to net income of $8 million in the same period last year[5] - First quarter loss per share is expected to be $3.81, compared to earnings per share of $0.09 in Q1 2024[5] - Non-GAAP net loss is expected to be $6 million, compared to net income of $21 million in the prior-year period[5] - For the first quarter of 2025, the company reported a pre-tax loss of $270 million compared to a pre-tax income of $13 million in the same period of 2024[20] - Adjusted income before income taxes (non-GAAP) for Q1 2025 was $2 million, down from $29 million in Q1 2024, reflecting a significant decline[20] - The net loss for Q1 2025 was $363 million, compared to a net income of $8 million in Q1 2024[20] - Adjusted net loss income (non-GAAP) for Q1 2025 was $6 million, a decrease from $21 million in Q1 2024[20] - Diluted loss per share for Q1 2025 was $3.81, compared to diluted earnings per share of $0.09 in Q1 2024[20] - Adjusted diluted loss earnings per share (non-GAAP) for Q1 2025 was $(0.07), down from $0.22 in Q1 2024[20] Impairment Charges - Non-cash impairment charges totaling $276 million are expected, primarily related to a tradename and goodwill impairment[5] - The company recorded impairment charges of $140 million for the WSS tradename and $110 million for goodwill in Q1 2025 due to a decline in stock price and market capitalization[21] - A valuation allowance of $117 million was recorded on deferred tax assets related to net operating loss carryforwards in Q1 2025, indicating a reduced likelihood of utilizing these assets[22] Merger Agreement - Foot Locker and DICK'S Sporting Goods announced a merger agreement with an equity value of approximately $2.4 billion and an enterprise value of approximately $2.5 billion[6] - Shareholders will have the option to receive either $24.00 in cash or 0.1168 shares of DICK'S common stock for each share of Foot Locker common stock[6] - The transaction is subject to shareholder approval and is expected to close in the second half of 2025[7] Strategic Focus - The company is focusing on enhancing in-store experiences and digital offerings, including new mobile apps for Champs Sports and Kids Foot Locker[2] - The company closed all stores in South Korea, Denmark, Norway, and Sweden as part of its strategy to improve international operations[21] - The company reported a $5 million gain on the sale of its Greece and Romania businesses in Q1 2025[22] Reporting Schedule - Foot Locker plans to report full financial results for Q1 2025 on May 29, 2025, but will not hold a conference call due to the pending transaction[8]