Dick’s Sporting Goods had a stronger-than-expected holiday season, galvanizing the company to finish off 2022 with a bang.
The sporting goods retailer shattered analysts’ expectations for its fourth quarter sales and earnings. Revenues were $3.60 billion, a quarterly record for the company, and ahead of the $3.45 billion expected. Adjusted earnings per diluted share were $2.93, compared to $2.88 expected. Net income was $236 million and same-store sales increased 5.3 percent.
The company has managed to buck the weaker trends across retail — and in the sporting goods category as a whole.
The chain’s leadership previously cited consistently strong consumer demand for its products, despite inflation. The company has managed to capitalize on this momentum during crucial shopping holidays, such as back-to-school and more recently, Thanksgiving, Christmas and New Years.
“Our fourth quarter was a strong ending to another strong year,” said Dick’s CEO Lauren Hobart in a statement, adding that the retailer has addressed “targeted inventory overages,” which has put it in a strong position to enter 2023. “We couldn’t be more excited about our spring assortment,” she said.
Like other retailers, Dick’s took measures to clear through excess apparel inventory in Q3, which it managed to do through different markdown concepts online and in stores.
“On inventory, there is still some excess to work through, but this is relatively minimal, and Dick’s is having success clearing this through its traditional stores and its own discount Going, Going, Gone concept,” said Neil Saunders, managing director of GlobalData, in a note.
For the full year, net sales were $12.37 billion, up 0.6% compared to 2021.
Given the strong results in the holiday season, Dick’s expects earnings per share of between $12.90 and $13.80 for the full year of 2023, up from $10.78 per share in fiscal 2022. Same store sales are expected to be between flat and up 2 percent. While this outlook is softer than current results, it does not predict sales declines, which Saunders said is “a very clear win and something that sets it apart from many other retailers.”
“Following two consecutive record years, we are very pleased with our 2022 performance, which was the largest sales year in our company’s history,” said executive chairman Ed Stack in a statement. “These results and our 2023 outlook demonstrate the strength of our business as we continue to execute our multi-year transformation through focused strategies and strong execution.”