DICK'S Sporting Goods (DKS) 29 May 242025 Q1 Earnings call transcript

Thank you for standing by, and welcome to the DICK'S Sporting Goods First Quarter 2024 Earnings Conference Call. [Operator Instructions] Thank you. I'd now like to turn the call over to Nate Gilch, Senior Director of Investor Relations.

You may begin.

Good morning, everyone, and thank you for joining us to discuss our first quarter 2024 results. On today's call will be Lauren Hobart, our President and Chief Executive Officer; and Navdeep Gupta, our Chief Financial Officer. call at archived months. investors.dicks.com today's Relations our of located website for playback will in be Investor A approximately XX

on a should uncertainties making to be materially from actual reminder, that Any differ in As well subject SEC, such statements. release are statements in our discussions results cautionary with forward-looking conjunction including last to various during risk our and this considered could cautionary as statements that statements and these in factor Form annual made statements report with as cause our the be our risks XX-K earnings call. we'll filings

We assume non-GAAP referenced in our statements to Investor forward-looking no Relations today's website call. financial these measures a obligation our update of to information. of refer any or Please find to reconciliation

finally, admin few a And items.

as on First, to business. quarter, call, we sales beginning revenue revised earnings from this last calculation our our GameChanger comparable include previewed have our we

grand These beginning opening new historically Second, have part within presented with within costs of stores in onetime preopening opening were SG&A, this connection costs advertising costs. incurred advertising quarter, we included expenses.

have period reclassified conform to our year We presentation. amounts current to prior

quarter are September And future your scheduling our purposes, results X, earnings planning finally, to publish we second XXXX. for XXXX on tentatively

With that, over call I will now to Lauren. turn the

from experience, a how momentum continued athlete and focus on our omnichannel strategies our everyone. you, experience, our Powered best-in-class the the product We're demonstrate our fourth DICK'S morning, teammate we results, engagement good with compelling which well and Thank strong are Nate, incredibly assortment, providing quarter. proud our QX brand of by deep working. differentiated

continued strategic gains. these share on market execution pillars is driving Our

of $X driven for in X.X% sales comp average year. first top just strong in ticket. to calendar our billion. This last on transactions by which quarter, shift, the X.X% increased increased X.X%, comps growth comp and For a was Adjusting was the our over

they saw year. spent us, more to athletes more each purchase quarter, compared and the prior from trip the we During

EBT Our over of basis In gross we XX total, double-digit of margin margin achieved EPS we first XX%. quarter QX expanded $X.XX. points, and delivered

to the range raising Today, We for EPS be full we our in year growth now year the strong X% results. $XX.XX. to comp to expect reflect to X% sales range the are $XX.XX QX in of be of and to our outlook

emphasis on engagement. robust driving athlete omnichannel is experience Our the athlete

into to and the athletes We service our provide levels digital all store are, need wherever are enhance across service our support and experiences faster. to their they hands get product they continuing and meet

we QX, spend our frequently and see our in than more to us athletes. athletes, growth During continued omnichannel strongest more who single-channel shop athletes, with

delivering about As reposition our our elevated we've omnichannel key experience. are an previously, investments portfolio talked to significant to athlete

drive DICK'S to robust House square our athlete of and strong next-generation and XX,XXX and expect foot store generate We omnichannel sales engagement profitability. Sport

During locations open excited this are QX, locations opened we X year. to and X House of Sport additional

We XX X also to first and next-generation additional forward XXK XXXX. opening an quarter during the locations locations look throughout opened

of one-two This the bringing to light pleased combined and exciting throughout to format, entire next-generation concepts. our of the of elevated XXK be We the with our experience of punch these is continue DICK'S very are teammates omnichannel House portfolio, our results Sport future with DICK'S.

quarter. the of to in bring X golf the Performance more of first enthusiasts We We're for confident remain long-term new also growth in opportunity experience and are an experience during Galaxy levels, this growing golfers. our locations Golf immersive excited opened all golf Centers, to and

where the and to streaming, mobile best central youth digital a scorekeeping experience our capabilities in Investing first app, GameChanger, building we're sports. our place omnichannel talk live scheduling, I success. to want is about briefly to communication premier and

averaging GameChanger, growth. all sports, Over sales engaged across such are usage app. with soccer GameChanger per app and on GameChanger We the strong saw as to platform, including day QX, drove that in robust minutes During volleyball. of a million basketball, football, users increase approximately those continued XX X the newer unique the

within with fast-growing, to excited and market innovating sports multibillion-dollar their youth continue and through our strengthening athletes technology the We're GameChanger. families relationships

excited strategic access from Our which product sport is our products, the on-trend differentiated to the U.S. pipeline helps for partners. in brand key go-to our second make DICK'S pillar, destination the We're about

that to recent Summit to Paris highlighted our Innovation bringing athletes. apparel we For breakthrough footwear example, forward across several products Nike's and look

Our better. ever, our been opinion, partners relationships the in performance with style, stronger are than brand and our never has and innovation of

DSG, flagship margin addition, athletes. greater expansion. growth They the long brands. a resonating our total for to see outpace continue VRST CALIA very profitability comp for are and contribute We and In runway vertical brands and growth sales vertical our our well with company

Place of is Our priority a This named Great strategic teammates critical are success, providing a to past the for driver were Work teammate our third fourth a our and we quarter, best-in-class experience. where We the on remain our a tools teammates and row. and culture jobs year and do with develop can driving focused thrive. them help they to a technology in better providing their

brand deeper engagement. creating we're Lastly,

announced pursue celebrate $X even in more first marketing our giving also foundation, to campaigns program the Matter passion. grants the XX-year continued in invested Program, several During anniversary million mark and building the DICK'S their March is to We're in to exciting that and and Madness. we excited its Sports anniversary young athletes during brand recently invest quarter, to of empower

quarter pleased the in very with profitable are performance sustained strategy we our are closing, first strength and to drive confident highly our of In growth.

an their the to Sporting and hard of their commitment results passion It's all like truly Goods. Before DICK'S work these our concluding, make that outstanding They possible. continued are across I'd for to and teammates tremendous efforts company team. thank

over share detail. With that, to the financial I'll call turn in results more our to Navdeep

and Lauren, morning, you, everyone. Thank good

of Let's begin results. first review with quarter a brief

to XXrd to we gain which $XX for the market billion. share. believe week due calendar sales shift our of This of last increase approximately the continued increased consolidated comps Adjusting We the clearest included to X.X% as year the very pleased provides from of to are benefit shift, report calendar view X.X% we business, a a million. $X.XX

comps were strong comp last a of X.X% year. Our top on

Our increase and X.X% transactions in X.X% QX we strength a athletic apparel And saw hardlines. were driven average ticket. increase in comps footwear, and by across a

first profit $X.X Gross the sales to sales higher margin decline XX.XX% on last anticipated noting quarter shrink in year, our merchandise billion the of than a included year. year-over-year basis that leverage XX be occupancy included while to increase worth and points. points, previous or we basis basis that higher for from XX in strength was It's of which XX moderated shrink higher points of as to year. increased costs due X.X% net This dicks.com. a million campaigns costs as expense dollars points This expected, and estimated higher increase also to Galaxy compared deleveraged growth. support SG&A we introduced in in to and last non-GAAP and our CALIA, investments supporting as included expectations. On the included incentive basis of earlier SG&A brand well in Golf DSG compared This basis, this year, exciting compensation sales expenses XX our increased $XXX.X and

million, driven year. increase of the opening. Preopening an House prior our of primarily by to million $XX.X compared increase Sport QX This was expected expenses were $XX.X

have reflect reclassification expenses As been to Nate to and brand the preopening of advertising and prior earlier, opening SG&A SG&A preopening years the adjusted noted current from in expenses.

XXXX. or of in $XXX.X compares of sales. XX.XX% to of This million net of EBT $XXX.X net sales was QX XX.XX% EBT or million

$X.XX of our vesting from last reduction quarter I'll tax expected, you approximately share this earnings As year, earnings XXX points and employee year. $X.XX. first of the higher year $X.XX that diluted year's rate to to in delivered current the tax QX which total, diluted to year. compares prior the from we approximate last favorably QX awards by exercises In grew in per compared share reflects basis of remind XX.X% this impacted X.X% increase quarter. earnings per the XXXX equity This

cash ended We and our QX unsecured cash equivalents to looking our on and of $X.X Now balance $X.X credit billion billion approximately borrowings facility. no with sheet.

our believe inventory year, slightly of clean sales. end increase to is and inventory QX well in last quarter Our X.X% increased X.X% positioned. levels below compared our We

capital were paid allocation. million quarter $XXX capital and first our million, quarterly to in Net Turning $XX dividends. expenditures we

for to We continue at also XXXX, of million. $XXX stock In price of $XXX.XX. our of repurchases shares $XXX.X share we repurchased million average expect XXX,XXX an

Now turning XXXX. outlook for to our

for business, we our result sales strong in $XX.X outlook. performance, demand a our of in billion. confidence year We consolidated $XX.X to raising full QX expectations robust from continued our athletes our As are have and the of we billion expect now range the

X% in range now the sales to of X% expectation to of X% In growth. X% addition, our compared to prior growth expect we comp

be to now We results line XXXX is Gross margin expand modestly at at margin previously previously. to midpoint at XX.X% to XX%. the XX.X% be to now results. XXXX non-GAAP with expected gross approximately is expected compared margins compared to EBT non-GAAP planned in

SG&A expect to to expenses XXXX modestly non-GAAP We leverage results. compared to continue

earnings In to per share in prior of compared to total, expectations range the $XX.XX $XX.XX our we of $XX.XX diluted to year $XX.XX. to now anticipate full be

is rate of XX% expectation tax outstanding our approximately of guidance approximately to earnings XX effective approximately based average Our an million diluted and on prior shares compared XX%.

to the expenditures We net approximately capital expect for continue year. of million $XXX

things to that want second comparability quarter. you for of to results a of point our Lastly, financial XXXX, couple we model as expect out I the impact

in the First, due second reported impacted an sales with to to we be first our calendar, expect total in shifted the recall offset positively half. that half

key a week, sales prior in the approximately we million given back-to-school Specifically, on the to QX. versus expect with in shift $XXX our positively QX total of impact be an impacted offset by reported the year,

second higher begin upcoming will anniversary shrink in XXXX we the to quarter. rates Second, the from

we over in also see point our our which during from of unfavorable year in results shrink of As year's Consequently, quarter. increase a an second reminder, shrink true-up favorability to basis this inventories, XXXX. reflected XX a actual cumulative QX year-over-year last physical expect included

Sporting remain In you our This our future our your interest DICK'S are the closing, prepared Thank enthusiastic remarks. business. with pleased concludes results about and Goods. we for in QX of very

Operator, you open questions. may now line for the

Instructions] from of the first question Barclays. from line [Operator Your Yih Adrienne comes

in need longer to create next-gen. store that people other House or philosophy the Sport that lucky quarter. for a DICK'S guess, my the or of to And congratulations was term. another Lauren, notion The year. question to you store start to I great during we were more is the a And enough House wouldn't kind go want you see on to of of Sport the than Boston such

So to kind goods going that of of the see the out? forward, you panning kind you how extent do sporting landscape see

in of is my then training, main level up currently the that of And investment landscape. seeing advertising, in education, we're kind the then and service question a anything it's retail

talk retail? of versus rest and the going differentiate to you're the about you that concept can that's investments kind making how there of So your

coming people through Yes, in Adrienne. House in there. Boston. have Thanks, excitement were had to see. has of ton just we Sport Great. the people the community delighted to good that the been We've of And absolutely and incredible a you

I that thing redefining seeing are that we think is really an is it. truly cannot get what about sports House to anywhere people that the else. you're responding are Sport of And athletes creating retail experience is

I how Sport. So of saw know it. -- the going of that communities when by. don't open texted There's fanfare you so excitement are some and blimp House responding much to you we a just

But they athletes then of experience see and time. coming further. Sport. more that are They it's excited are They're about in. really House the They're opened, driving product spending at as the

really House bring that and also have a current to partnerships new in brand elevated to throughout our access both spaces the other brand excited because excitement partners brand can best life, that's the way. Secondly, bring a company brand a as we because are showcase us way. we our in brand collab and helping But opportunities we Sport, entire can of a more as life And very partners. to have in well with drive truly we possible

is in out seeing think traffic developers, then are increases the look to if a the that is when you note mall. important in we a would and and at of thing real point landlords Sport mall, last And I to developers that opens mall significant estate House I

of in excitement Sport of equally House of Across the the we're XX,XXX excited so provides foot House there about the as is which there's well. just square format, the super And Sport, elements. same about our marketplace many of lot takedown a board, a of new excited and

invested SG&A. -- Navdeep planned, it expenses I in in investments, bit we to we QX about turn asked about talk SG&A were I'll little You to a But the as marketing. and --

to to be build long able that training the We We will invest term. tech tools continue to need service invested and in to brand our teammates deliver. to and athlete our drive experience

Anything add, you Navdeep? would

Lauren about what X it's teammate pillars, athlete on that Adrienne, and core of the about is as Yes. just the pillars a those and No, said, lot be, said, experience. and experience Lauren focus building the we talk continues X to the around

within that as team into provide the specialty kind golf well our they're team, well. product the baseball club, in our doing and whether And bringing of above differentiated the it's in players we the kind a our but, fit team a marketplace industry own against that that, experience store, whether walk very feel, in merchandising -- to are peers as and frankly, our see they our that, bat, we differentiator, is as it's store the providing that not only when the is of store are stores. quite to innovative as the to are some experience doing And athletes able the of work we this

a Lauren and the delivering part investments including our expect we that be for as But here of advertising, the area be that balanced like continue are QX. And as we differentiated they investments against our with sales vertical brands to well. So that to will growth investments. we showcase in key are indicated, how these

of Your from the Stanley. Simeon Morgan from comes next question line Gutman

gross ask the are can margin being of to elevated down also the is and -- of context sell-through margin little quarter, spring you merchandise, And the plan be occupancy? with within gross or being margin this by to summer, flat seasons the Or in margin about guidance? seasonal merch wanted us, I a share merch is was overall as margin merch transitioning.

Thanks, we leverage and there more would e-commerce were Simeon. unexpected drive be. with were more as leverage XX.XX%. good and margin, our expanded There chain costs. surprise on we XX the puts occupancy with sales basis expected costs, of gross on for quarter, pleased and takes Yes, ton an points, the really supply us -- the enabled a to numbers Well quarter to that

shrink offset by basis anniversary-ing reserves were start point put the in primarily All the decline anticipated that we'll slightly the that had merch fact in -- -- driven that, into anniversary-ing QX. yet not of we margin. place. But that And was a we're those of XX shrink we because

-- inventory I think keep one core driving it's clean and our important of our to note and merchandising sales strategies that our of our one core strategies to is fresh.

getting stores differentiated come them. finding life that completely are shop the assortment, appealing that or when and through product moving constantly are We the cycles products they people into are our they're online, a to

expected, now to And QX. are so for as merch in we said margin be But year, before the gross margin to was going expand whereas flat. was slightly had it expecting declined modestly, full we

expecting... And we are

want ask... I to

merch expectations, a Lauren say, to also would just expect in results. thing compared 'XX Simeon, was what to QX and we The I'll line one more basis non-GAAP said. add margin, in I our with in on modestly XXXX margin merch expand to year-over-year

EBT, and at in versus it, whatever achieved was like implied raised being And or above EBIT it's Okay. beyond EBIT a you beat or Navdeep. what way number looks full year The follow-up, Street the The or then QX. look

think, in The like of a comp, looks flow-through from QX. happened it's more I what

what that QX? profit is So what back And sales kind changing of raise is terms moving while to in fair? in the up is half, happened by of

Simeon, a Yes. that's question. great

the QX. in we us. remain all, delivered and that by we saying by future excited ahead results let me the really that opportunities And of here we First to continue were see really start excited the we of about

imagine, As just can is QX. you this

else is everybody macro very are a well knows as the year, happening basis. factor in We as early on what

it we guidance largely here maintain that in reflects in QX terms So for our the we results through QX. the and what full today we QX, year expectations is posted of have done

I with the cautious But year. to a of see appropriately There's that QX. the the think disconnect as external about we consensus about we expectation, bit little a but of balance say we the through really excited we remain would are opportunities for continue QX

from from comes question of Goldman Your Kate next the Sachs. McShane line

believe of sales based I gains. of that on same-store was market assumption X%, X% you mainly guided last share to your when

is better comp is market on to driven by new any share? X% that? primarily industry health guide the today, it of view the Or the still X% there within of With

the Kate, the balance to to comp X% the guidance for we are X% of year. excited to to from X% raise X%

Navdeep part we the that that As results an that the had through appropriate just flowing large in we mentioned, of just level QX, caution so do of maintain is had go. as we

strategies, of to do that. one and market key think be We gain obvious do continuing able plan have we our we product we and That's the -- to on the experience to share.

question. And our Okay. then second

comments and that about meaningful With comments some earlier a and goal can change of GameChanger with terms your there is of the of strategy the kind change long-term for And the there how accounting business? drive the prepared in GameChanger? is what strategy in GameChanger, in much

the with about in for fact people how they're the excited sports, and that it can such and an their through where with grandkids' they're sports, GameChanger kids' which Thanks engage Yes. can their motive stats a is question. kids platform and -- doing We're see their amazing performing. so and track excited

So It's and platform. new you're meaningful been because digital incredible success. in It's hearing leading the it this excitement keeps sports investing capabilities, app. driving got we've a

users QX, an in per minutes on in incredible XX the million platform it's on average spending -- day X engagement So on active tool. GameChanger,

that become of the key look synonymous way a we at of to ecosystem. I entire sports. long-term it's our with at part It's So our way part it look it, is strategy the

It's in that relatively it we're negligible our of part a now, future. believe we -- starting seeing You're but part to is it for equation a right account of comps. big

Lauren what to that, said. to points more X add I'll Kate, Yes.

profitable platform both and a a platform. a very First well on high is -- basis sales as of on growth, all, is right, very a itself the

fantastic. the itself business is by itself, So

a about ScoreCard the a have are GameChanger have both that talked user revenue and we a Xx user other user. the The fact is of athletes thing the ScoreCard that profile that just

the opportunity indicates and engagement for this these multichannel athletes to we also of long-term actually really, platform. is the look have as us that that level exciting interesting with really So that we to

Your next line of comes question from from JPMorgan. Horvers the Chris

So about a after drivers first Can is that first follow-up on it being you you about merchandise question can quarter what of -- up the talk my makes over the the -- talk year? just what margin. down, go the

We've it Is is the coming? newness up? about the address, maybe of heard us being maybe vendors there. Sport? think answer, that it what Is within some the channel the Maybe promotional. inventories clearing And are of House big about drivers help

Chris, I'll full Yes. with year the start provided. that outlook we

compared So modestly we we year. results expect merch gross the non-GAAP margin and posted to expand to both the XXXX margin last

you within QX today we -- ingredients the a points think already need are QX couple model this. around about of that The have be about to that, we as results, there if thinking shared you declared what expectation you

we store. The did and shrink first XX foremost in had accumulative that of last is basis the year inventories true-up points physical in an we when

don't impact same so that year. we anticipate this having And

favorability be And to line QX. So expect cautious appropriately we year results the shrink the just itself. continue be shrink balance there in on we will that in for of the

the addition, would -- of year up cleaning in that would were some inventory in And recall QX. in remind you we as you space last outdoor the

assortment and key great in we this of feel the kind for season either inventory that have anticipate our here going available about year, into -- those and, the So have because most annualizing the quality the importantly, don't really QX. we we we inventory exited selling where of the actions the QX

that assortment and we're So how is. clean the about assortment excited

not as So QX. look we annualized again will expect to be we action that

a as how you the specifically my about we Got know year? question, cadence how touch bit it. you follow-up think to over should in -- can but And little on drive about by speak just a don't think comps of -- the then you I quarter, that?

House X points. the in know think Sport here the stores, with around stores, I some the regards and to I lift quarter maybe of the there was first closed general was consensus lapping

So the any think the how year? on comps comment about over you that of and cadence

in originally, half had of we of half We X being right. of the hold absolutely the good Chris, still where of and converted part the is stores first Yes. a you're for year, to stronger of driving we and House last closed QX. largest first comps year our said to that, Sport

the feel comp Now just we we half, stronger the impact. than second we -- we up had we'll expected. half, And will do first go against then openings. delivered obviously a in -- that that even in But those

said deceleration we've why we has the is back nothing changed the that that in expect and in so half, opinion. -- deceleration And some

believe continue We that. to

of Ohmes from Your Bank from of line comes next America. question Robby the

first is footwear could for and been leading Great for signs or start again while quarter. apparel that and expectations grow catch you little question Lauren, just, guys Any now. My you have a to with guys? up hardlines

our great Thanks, growth the we we Robby the had all yes, just what's comp X.X% with across really is saw business. of about quarter aspects

saw So in in apparel. footwear. growth we growth We hardlines. in saw We athletic growth total saw

there. some trends of the there's our the that's piece some puts small a of very pandemic, some And takes and consumer business. talking we've but rightsizing from of those are Obviously, -- in that been about

categories And very, a And very in business. season team the wetter very past just quarter, and impacted excited general, but about core we are bit, of a nominally so. we're little well. slightly golf game had hardlines sports This the the doing hardline

the Nike, then more in year your Nike from last And pipeline into other a what you press looks the think vendors, you getting you Paris what and little year? were guys on the it. the color Got Summit release. Can like give versus key out called heading you

strategy planning see product Yes, of we we excited we about out partners. have couple our with across looking strategic where that pipeline we Robby. meetings, look we're a the term. I partners, our strategic years Thanks, say would Obviously, and long-term long are

vertical doing CALIA, we future Within more are, looking I'm Innovation our were and brands. emerging offices we our and incredibly Summit. that VRST Nike. all some were saw brands, there work then long-term at in DSG, are of recently, innovation. the about very also at we well about very excited, And our strategic as the flagship we in excited their We partners,

very technology out apparel It's from I would footwear newness and to that going about to the are the bringing bringing call be some elevation of and exciting standpoint. consumer excited they like We're really performance things those both a into Air platform. the categories.

Olympic to talk drive is we started be, brand. are that then noise market going And see what and and about really, excited around their to Nike consumer messaging really to to they've just the come

So board, that very partnership. across the excited about

of ISI. question Your Warren from next the comes Cheng from line Evercore

Congrats about of I the really a here, on at solid House strong wanted investment getting about service and Sport whether quarter evolving the next-gen in response to a and here. SG&A and the tough elevated environment that's thinking levels really you're ask how given stores. to you're

the Could just maybe could take in talk about how of And and kind SG&A term selling of if SG&A minute level a you're you higher benefit thinking a about core from medium personnel? and the here.

first Warren, in. SG&A let's -- of with start all, came we where So

making, in well. here points like especially much XX by QX, in core appropriate so resonating brands, fashion Lauren those because and opportunity investments vertical we position, clearly -- including we was our see so flagship driven are are with to our an athletes more continue to deleveraged the SG&A advertising, that that basis So said, in brands, a because

as out drove DSG, dicks.com. you with saw message CALIA, brand So as around for platform our around us with dot-com well the awareness come advertising

we that. in invest of So that will the year, part were and and the early area we QX be to an did going we that said

we leverage guided basis, is a to year-over-year on we expect on And what have year full our modestly basis. a then SG&A

being in So we we prudent are making investment. are how

well the to those especially House store look of we are making I You investments planned kind are that the to in level, as are we in service as making And addition training. that XXK. in technology called investments we in making, out, the store talent, investments as as Sport the in are well of as

So that with driving we'll differentiation to to core resonating really are are and the meet the continue these in marketplace the look athletes. investments well

drive line year. the also balancing SG&A overall to the against for on ability leverage full the the However, that

rolled And larger one us that last represent help a sort XXX my next more gave box in you're in million little this X the follow-up question. you more the [ fully put $XX the that target to to number the Can XX productive chain? Once bit stores years, ] per of you context. quarter would and of out over

know of across different and sizes. House representative I Because have the Sport lot shapes of you the that the Or average expect pretty out that scaled new a fully you're is would -- of chain?

Yes.

million we quarter, So Sport the of both business. kind basis. the That for an $XX last the well as expectation as that's our average store on eComm that of House includes an omni shared

that and have Based is with by here rolled XXXX, And opened we stores the out store we have in we continue XX that stores. QX. informed of done end XX the those to of openings be learning have -- this based at off we really excited the X

continue also longest have House that deliver -- of incredibly out results. are the Sport, growth. strong keep been the And XX,XXX also point driving the to would ones I the opened

that. how but really they open, how just we're past not excited about So grow they

of Your Baker next question from comes Davidson. D.A. from Mike the line

Okay.

The after think, so EBT maybe it margin for up, I the implied -- of of down this in quarter. way. rest another the Sort the -- the EBT asked asked, is been was but year

Now seems declines it a last like lot from second quarter is that because year. cycling the of of

to up? the year. keep line the year? on potential going will guiding think What the margins, So is increase in the basis about And half margin the XX long-term How this drivers? quarter, think, we once second the are we back I the up, EBT be cycle easy Should your you're the this. should of margins, beyond margins I year, this points margins comparison the in sequentially then question guess, the

our Yes. expect today, to the On what we gross the but question. you are for margin to our we compared well Mike, results guidance we fact a year driven quarterly by full to have basis, leverage key I some expect EBT given to SG&A expand non-GAAP great as modestly that ingredients. XXXX. to won't of provide as modestly margin expand

will that QX. be being out by called from you of to leverage going drivers Keep QX amount QX here mind, $XXX the will really definitely And in we're have that million driven higher the of QX. in shift well into the of also sales see that

terms line sales expectation, top term. In both our we profitability ability be about the call long-term the to the as of as it, bottom continue over the really, to long line grow well excited

Okay. million was Follow-up and much question. Larry How preopening which makes Parish $XX in to went amazing? at up to Bird, sense. the That your Robert costs show Kevin opening, pay of McHale increase

Like driving community Those in are in what there. results driving and such we question. the great But the are investment stores. they said, right an overall the Lauren are here you call these excitement that it

Great question.

next Your Group. Joe Feldman from Advisory Telsey the line comes question from of

promotional competition there. And Wanted And are bit like and levels still to ask what lot what curious a about it a environment of you're seeing you're it high brands. bit a from just inventory and feels the I'm about of you're how approaching the seeing. the and out some

was and is feel it. of growth better on end We industry of unusually a it place in X.X% our last a our Joe. Thanks, good particular, we the And in total really didn't QX. comp, see inventory, than the Certainly, at healthiness the inventory overall promotional environment about an year. X.X% in

drive way. And we to that with promotional continue come to know profits. whatever tools manage have have our so the we we environment concerns we're that -- no manage we to will and we ability through I think the have But there,

in it. then we you But performing? there. of to still some the another of And Because how And and saw wondering hear step-up about. is if a asked kind broadly to your were of that guys performance. out categories -- outdoor again, want I outdoor know Got it's just question related kind soft --

Yes. the outdoor want Joe, a TAM. point tremendous have out. long It's to in $XX we In billion confidence term, I the business. a

We building are lands. public

to are move unique we We outdoor bring really working can in, our category. in to differentiated rather bring to explorers athletes so the deliver a them experience that and

reset, that there board, is piece that confidence, business, post-pandemic take here they're can our it's industry take first our small a else. better a today. have away at and to our of -- being that of confidence, than consumer everybody the away we're in served this we doesn't Across does time it all, serve the from even doesn't a than different But continue long-term no and

the continues in high. to category participation be And outdoor

strong. category going this going be So to really to when it's we it's -- rebounds, believe

from line question comes Kernan the John Your TD of next Cowen. from

a on from premium Can of deck quarter. talk footwear? has footwear On. Footwear top know going allocations congrats a I you been obviously Nike, attracted the HOKA, comps And to great back to year. big last has driver

to the of you're On more How getting and just given in be? get big can the a How more premium And can days. doors comp footwear into? such decks allocations talk many it's portion many footwear HOKA there maybe these

very key Yes. the of Great Footwear We're train. drives big question. certainly footwear people how driver that shop. and a of a been footwear part pleased our the is with comps, has It's engine business.

footwear partners. brand driving Our which putting into are and experience for absolutely more then allocations, us specialty many started premium full-service ago, decks, elevated that more we up opening place years

with the premium XX% the by obviously, reimagine the and portfolio end -- at HOKA And we development the and premium have full-service store year. all our On of decks. be footwear of will new footwear decks, as With we'll

a HOKA brands a to of and On portion in the significant those just number continue are is point brands. at than of as expand ahead and further terms excited to On count, HOKA still both we're well. chain. in good door this upside in There's of still little the

saw significantly obviously it. sporting the first industry you in we then the more Got within And sluggish maybe some outperformed. that trends goods quarter broader

that any share And outperformers you market are in are category the thinking the how industry? outperforming? in were long-term Just regions QX? are about there biggest What

our of different hardlines had all We Footwear, business. saw We the apparel, saw across areas trends of We growth X.X% total all see categories. our comp. across Yew. sluggish growth. didn't We grew.

And what a priority on lifestyle. story. we to I -- think can and speak The putting active absolutely healthy consumer is our

that's But running we and we both as that see experience providing that choosing, thing have and the to people our experience think most the that store with the I being in an products well as they're and walking, we stores provide important due You in is are clearly that online. outdoors. them

And of that the are seeing so we're and to across country. are life pockets softness coming performance, driving it's any our that not the core strategies

Justin from comes line question from the next Kleber of Baird. Your

Is what modest I First, you've just or margin recapturing full the improve mentioned guess, lapping clarification a Navdeep, shrink the core expansion merch outlook. from year margins to you're last I merch Particularly, the would your expecting, year on the clearance. just call, pressure year-over-year? outdoor

So I that wanted to clarify just first.

Yes.

So impact favorable then continue to cautious. from QX, a be and appropriately shrink perspective, we we said having that we be will in

to needs the half still counted have half chain counted. of chain, the of be and We

imagine, So cautious as to you want expectation shrink. in for be our we can

are product side, on bringing, merchant And our performing that that differentiated brands how be in well the are CALIA, DSG, continue of the enthusiastic work terms flagship we work we we margin doing to the vertical VRST. the is doing between and our about team really merch assortment are

we the basis but grow the so I gross on expectations -- margin, full margins, we and be modestly merch down as expect margin merch to than we year. margins continue a to that, break year-over-year And to our both won't deeper look

Got it.

Okay.

you the Just assume sales higher margin. if through calendar much could share I EPS those one benefit around shift. flow a Curious the other XQ. in at incremental question

XQ But just $XXX impacted again, can earnings? benefit. the million color then about million think on how to XQ lift just we $XX related that so shift in And the in in calendar any

in early would on $XX the say, can appropriately it's is can this the the so -- and imagine, shift And you as SG&A. do expectation I of that. happening calculation appropriately year, Yes. can your million, margin so the adjust you a flow-through part you is

with amount QX neutral. offsetting say, favorable same would would within impact It's is net approximately just that an QX. $XXX sales and in get going impact to of million the of impact the I a between QX the QX, be the

question the of next Truist Joseph Securities. from Civello from Your comes line

in quarter. recovering just XQ, In outdoor we you you're or guidance from give I most of cadence all ton about on to obviously, any a Should the think that congrats about year. And year. the lapping be going could cost the wanted another of ask to this last clearance question there? of that? Or

a give of be basis that had, to clearance impact against favorable if any don't know lapping we But basis. will the unfavorable the that QX. quarterly the saw I of kind in we guidance Joe, in an out, imagine, you can you that activity of XX as specific shrink I'll we points almost more called about true-up addition on

would we at said, I basis. like look we margins. merch a basis it to gross on margin well a our as expect on We the expand full as year-over-year year --

just then And more question. Great. one Okay.

came How you half you bit are lapping shrink second shrink little should a than last in said we in expecting. that I from think about were year? as you better think the normalized

absolutely. Yes, Great question.

shrink clear I It in So it. points shrink, -- going be want year-over-year did it deleveraged the is up on basis. a QX. about XX still basis here to

continue we appropriately cautious in and to where P&L look that's QX So basis. as we to a QX, part be on

to they're basis merchandise, doing slightly, in a I'll moderate internal give said, shrink versus to However, is of stores have of moderated is us and it, on appropriate would store be to did the that little our lot like shout-out so good look to year-over-year only our a bit just of a our a a appropriately credit athletes -- keep decisions move DC it team, strength. allowing our internal new and team we'll But line. I call balance not give which in to have the to chain, we operating you continuing safe. as cautious we versus the of the That work counted make expectations. the on year half our to growth a expectation, the continue

next of from the Grom line comes from Chuck Your Gordon question Haskett.

few strong, customers. on a existing My basis. unpack Curious is there's versus quarters customers really, way X-year traffic. really The if a on past have particularly to new question been

over base several we've years. past So the continued to grow our athlete

we had traffic has quarter. past year this strong. And million X.X and joined athletes new million then be I X last to continued think

it's the So differentiated also has and strong. is the in about the elevation experience the just product It's about of that the keep brand athletes. that bringing been -- we new fact and

good well. holding consumer is traffic So really, really up our numbers. very, And very

watch that Okay. appetite, my right, about your to just There's seems Great. and I'm new curious X how have position GameChanger. it here. different are you're guys there. I follow-up But big on then There's the ton like And a business. out is you growing platforms sports. of pole kids. taking a thinking just kids

over Just growing how you're thinking curious time. about it

Yes. started GameChanger is we the the Great have platform. a same Diamond business. you off, we question. Sports-focused have. was It vision best And And really,

get intelligence there. behind even on scenes artificial lots even excitement going we video there's And and more continue drive exciting to more and so while the to we're improve, using to there accurate, the

the Sports like is -- business Our is emerging they're the Diamond biggest volleyball short into a to term other thing to but other the platform, the sports, grow sports, emerging and in basketball things big and non-emerging priority.

be to how that's So near we're term. going growing

term vision athletes, our is at games that they're the long here, in at to our big their But they're during not store, how continue practice, and develop just training. we and when can when but beyond are their thinking we with and connection

Paul Lejuez from the Your question from of comes line next Citi.

eComm share see opens if you of ticket seeing, bit and And further stores trade the I'm about channels. area you're the both terms curious Wondering transactions House of business could you it in moving versus in in versus when anything eComm a about store as could talk they of we if a what little more Sport mature. what

positive comes story. the break area. we a very the Yes. Paul, a thanks stores a pleased we're -- stores to and in responds digital -- because new the for when question. and that pleased and the out when of Sport We our House so eCommerce challenging with in and know exercise. that's is eComm, all business very how business ecosystem omnichannel very It's open inherently, customer became the don't But it we focused with very

on category in move well? throughout maybe Okay. Then you contributing Did just in saw expectations, as you year your a based year? thinking what how performance is about you're this prior just as category to follow-up. anything of each how Just change terms QX, the to relative

delivering are on nothing expectations overall, material in Now, above the categories changed. our QX, and them

Our comes of Will line the next question from from Fargo. Gaertner Wells

in who are guys from, opinion? are and where your you taking firstly, Just share you guys

the board. been consolidation the across share taking really There's industry. good yes. We're some in It's a question,

footwear We strong share specifically, interest. for from -- have driving don't I is assortment, are to we out call premium but taking want anybody example, our

is Our apparel interest. driving strong

lifestyle. to true price needs. Our consumer vertical everything Even brands meeting from are opening point

it's So and across I the say gains. across the that board seeing we're would share industry

Got got it. it,

XX as you looks it points to basis added comp As like year. the last GameChanger, far

Correct.

there? to XQ. mean, far we do you as GameChanger going it I as going about comp and How seasonal forward? in takes mean, is think Is called about forward? out that how -- is how add much revenue think to it's think the puts GameChanger there revenue any and I I -- million $XXX we going do

Yes.

range You XX between GameChanger was million of basis. full and well. comp was Yes, the impact year -- the deliver a impact points, about about the XX And It to year from XXXX. basis full on points. $XXX -- to here favorable platform expectation the will really favorable to expect basis is in the said facts both of our sales we XX that

of from line Securities. the from comes Wedbush question next Basham Your Seth

is SG&A. just My on question

you in color Following have other the SG&A the you reinvest And track outlook? actions you any you focus optimization Are on areas to with year, planned? business last on you reinvesting there? that the still where took are

investments Yes. have No, area Sport, in continue the investing of in talent just House not that openings, all are us the is definitely openings, on itself. been successful frankly, but be capabilities. And talent, the these XXXX quite have focused store bringing right XXK. right, appropriate big the we doing we helping do of this along to at The

imagine, investment, are also we line returns helping top productivity There into in as that reinvest that drive is improvements, allowing which then the imagine, business. technology And of you lot can to is going investments. to a the as get area, can from those it's that is us us able which, you

growth well our area vertical to as the line, be appropriately the the brands. third And in awareness within continues advertising brand running as then the investment

it. Got

dependent XXXX, And so line fair going top SG&A Is to going be predominantly a forward leverage beyond that statement? is on growth.

opportunities. profitability as a basis, It -- both the bottom the investment long-term line between top we line we balanced drive will generally investment would again, I a fair SG&A But margin growth or say, statement. to improvement. well opportunity expect on That's as the be

comes final Jefferies. your the line of from Jonathan today question Matuszewski And

Great. Nice results.

was The first one ticket. on

indicate give growth remarks you the quarter. the trip. spend color just fueled ticket what this and It per industry, looks If more prepared than on could us more better

any color there So what's from XX-XX be in for embedded that more the revised split is helpful. And would whether reasonable. of XQ comp guide XXXX understanding kind ticket, regarding

I athletes by first same, access come the as the ticket basket is driving would say to. continues right? Jonathan, differentiated as that product the the to be have increased answer What size overall driven to our the when is question the to well store we

highly product that is in now. demand coveted, is the This highly right

the to So you into that product to recovery on well. a much allows demand but you're having selling not capture that get price better full that store online, able only is walking the as or

most allocated assortment product basket -- the well the as size the athletes as well the ticket drive size the the our sought-after as premium as product So both continues and and come. when premium to

And in guidance we the don't level. that terms guidance, at provide the of

about to excited of the the So as growth I'll X% growth. the the be driving X% for we And continue to really trend that between continue to the we level. guidance ticket balance full keep highest at well the year are comp traffic as

quarter. follow-up across trends And on Did this see Great. in income any quick transaction you the just a discernible shift cohorts?

and of Best all across Better growth see best We saw demographics, didn't. -- we down We goods. trade from didn't a Your our income

demographics cohorts. across consistent income of all the pretty So

Lauren concludes question-and-answer remarks. session. I back Hobart, will closing that CEO, now And and some for over President turn to call our the

I'm in all your strong stores, We'll of our CSC, very, proud thank a just quarter. thank interest to they our Goods. incredible you moment quarter. Thank and who DICK'S our all. our DCs, offices. see want I them. to this next delivered thankful Sporting And for team, take really our you GameChanger is It in And you, Well, very

your today's you conference for concludes call. participation. This Thank