The shoe retailer also slashed its guidance for the full year.
Foot Locker stock opened about 25% down on Friday.
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Foot Locker Inc (NYSE: FL) opened nearly 25% down on Friday after reporting worse than expected results for its first financial quarter.
The retail stock is crashing also because the shoe company trimmed its guidance for the full year on headwinds including a changing vendor mix.
Foot Locker now expects to earn between $2.0 a share and $2.25 a share on 6.5% to 8.0% sales growth in fiscal 2023. In the earnings press release, CEO Mary Dillon said:
Our sales have softened meaningfully given the tough macroeconomic backdrop, causing us to reduce our guidance as we take more aggressive markdowns to both drive demand and manage inventory.
Those interested in buying Foot Locker stock on the weakness should also know that Wall Street currently has a consensus “hold” rating on it.
Earned $36 million versus the year-ago $133 million
Per-share earnings also tanked from $1.60 to 70 cents
Sales declined 11.4% year-on-year to $1.93 billion
Consensus was 76 cents a share on $1.99 billion revenue
Comparable sales also sunk a more than expected 9.1%
Other notable figures in the earnings print include the gross margin that contracted by 400 basis points. According to CEO Dillon:
We remain committed to our long-term strategy, including making necessary investments to drive our Lace Up plan, and maintain conviction in our ability to execute against our new strategic imperatives.
FL ended the quarter with inventories up 25% versus the same quarter last year. Foot Locker is a dividend stock that currently pays a yield of 3.85%.
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