US-based sportswear and footwear retailer Foot Locker has reported total sales of $1.86bn in the second quarter (Q2) of fiscal year (FY) 2023, down by 9.9% from $2.06bn in the same period of FY22.
During the quarter ending 29 July 2023, the company’s comparable-store sales also decreased by 9.4%.
Foot Locker attributed the decline to “ongoing consumer softness, changing vendor mix and the repositioning of Champs Sports.”
The growth in promotional activity during the quarter contributed to the retailer’s gross margin decline by 460 basis points compared to the prior year’s quarter.
The retailer registered a loss of $5m in Q2 FY23, against net income of $94m in the previous year’s corresponding period.
It also posted a net loss of $0.05 per share in Q2 FY23, compared with income of $0.99 per share in the same period in FY22.
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Foot Locker president and chief executive officer Mary Dillon said: “Our second quarter was broadly in line with our expectations, despite the still-tough consumer backdrop. However, we did see a softening in trends in July and are adjusting our 2023 outlook to allow us to best compete for price-sensitive consumers while still leaning into the strategic investments that drive our Lace Up plan.
“Importantly, we are continuing to make progress on our inventory levels and look to best position the business for the upcoming holiday season and into 2024.”
For the full year of 2023, the retailer lowered its sales and earnings guidance.
It now expects sales to decline by 8.0% to 9.0% and comparable sales to drop by 9.0% to 10.0%.
As of 29 July 2023, Foot Locker operated a network of 2,599 stores in 26 countries, including North America, Europe, Asia, Australia and New Zealand.
The company also runs 184 franchised stores in the Middle East and Asia.