Foot Locker stock pops 15% on Q1 earnings

Foot Locker Inc (NYSE: FL) is up 15% in premarket on Thursday after reporting better-than-expected earnings for its fiscal Q1.

Foot Locker stock gains on reaffirmed outlook

Investors are cheering also because the management reiterated its guidance signalling the turnaround is finally starting to yield results.

$FL now forecasts its sales to fall between down 1.0% to up 1.0% this year. Analysts, in comparison, were at a 0.6% decline. Mary Dillon – the chief executive of Foot Locker told CNBC today:

The footwear firm forecasts up to $1.70 of adjusted per-share earnings in its fiscal 2025 versus analysts at $1.57. Foot Locker stock is still down more than 25% versus its year-to-date high.  

Notable figures in Foot Locker Q1 earnings report

• Earned $8.0 million versus the year-ago $36 million
• Per-share earnings also declined from 38 cents to 9 cents
• Adjusted EPS printed at 22 cents as per the earnings report
• Sales inched down 3.0% year-over-year to $1.88 billion
• Consensus was 12 cents a share on $1.88 billion in revenue

Foot Locker ended its first quarter with inventory down 5.6% versus a year ago. CEO Dillon also said in an interview with CNBC on Thursday:

Wall Street currently has a consensus “hold” rating on Foot Locker stock.

An overview of $FL's balance sheet

Foot Locker reported a 120 basis points hit to gross margin on Thursday. However, markdowns did moderate sequentially, it added.

The retail firm ended the quarter with $282 million in cash and equivalents and $446 million of debt. Its chief executive Mary Dillon said in a press release today:

Last week, Joe Feldman - an analysts of Telsey Advisory reiterated his "hold" rating on Foot Locker stock. $FL is trading below his $26 price objective in premarket at writing. Note that the retail firm does not currently pay a dividend.