DICK'S SPORTING GOODS, INC. Q3 FY2024 earnings call

• Strong Q3 performance with comps up 4.2% driven by omnichannel athlete experience, differentiated product assortment, brand engagement, and teammates. Gross margin expanded 67 basis points. Raised full-year outlook with comp sales growth 3.6%-4.2% and EPS $13.65-$13.95.
• Omnichannel investment: continuing to invest in digital and store experiences. Opened 3 House of Sport locations in Q3, with 2 more, totaling 19; opened 5 Fieldhouse locations in Q3, with 4 more, totaling 26. Plan to open ~6 Health and Support and ~20 Fieldhouse locations in 2025.
• Game Changer: over 5.5 million unique users active in Q3, a 21% increase y/y; ~2 million average daily active users in the app.
• Product assortment: differentiated, strong back-to-school performance in footwear, apparel, team sports; holiday ready with fully stocked key products; vertical brands performing well.

Consolidated net sales through the third quarter increased 4.8% to $9.55 billion. Adjusting for the calendar shift, comps increased 4.7% driven by a 3.7% increase in average ticket and 1% increase in transactions. Q3 consolidated net sales were $3.06 billion, up 0.5% (adjusting for calendar shift impact). Gross profit for the third quarter was $1.09 billion, or 35.77% of net sales, an increase of 67 basis points from last year's non-GAAP results. EBT was $1.12 billion, or 11.75% of net sales, up from $975.3 million (10.71% of net sales) in the same period last year. EPS for the third quarter was $2.75.

• Raised full-year consolidated net sales to $13.2 billion to $13.3 billion (prior $13.1 billion to $13.2 billion).
• Comp sales growth expected in the range of 3.6% to 4.2% (prior 2.5% to 3.5%).
• EPS expected in the range of $13.65 to $13.95 (prior $13.55 to $13.90).
• Anticipates gross margin to expand year over year, with cautiousness due to macroeconomic environment and shorter holiday season.

• Macro-economic uncertainties that could impact consumer spending.
• Shorter holiday shopping season with 5 fewer days.
• Uncertainty regarding tariffs, though current exposure is minimal and being monitored.

Q: Adrienne Yih asked about DICK'S ability to succeed in the current environment and impact of tariffs.

A: Lauren Hobart noted strong comps due to long-term strategies, differentiated product, and riding sport trends. Navdeep Gupta mentioned tariffs still have unknowns but minimal exposure for private label.

Q: Simeon Gutman inquired about inventory, P&L, and SG&A.

A: Lauren Hobart said inventory is strategically invested in key items, confident in Q4 and 2025 results. Navdeep Gupta added inventory is in line with expectations, and SG&A investments are strategic for long-term returns.

Q: Brian Nagel asked about House of Sport rollout and guidance.

A: Lauren Hobart updated on House of Sport's positive impact, community engagement. Navdeep Gupta provided store count plans and comp composition.

Q: Kate McShane asked about product differentiation and ticket drivers.

A: Lauren Hobart and Navdeep Gupta emphasized differentiated product, curated assortments, and vertical brands driving ticket and margin.

Q: Robbie Ohmes asked about Game Changer and brand partnerships.

A: Lauren Hobart and Navdeep Gupta discussed Game Changer's growth and profitability, and House of Sport's brand partnerships with national and emerging brands.

Q: John Kernan asked about House of Sport and Fieldhouse EBITDA trends.

A: Navdeep Gupta said stores show positive trajectory in year two, with deeper community engagement.

Q: Julie Wasserman asked about merch margin and shrink.

A: Navdeep Gupta stated Q3 merch margin increased, Q4 expected to increase, and shrink in line with expectations.

Q: Michael Lasser asked about merch margin expansion and inventory.

A: Navdeep Gupta discussed factors driving merch margin, including differentiated assortment, pricing, and vertical brands. Lauren Hobart emphasized strategic inventory investment.

Q: Kelly asked about SG&A, store openings.

A: Navdeep Gupta provided store count plans for 2025, with most openings being relocations/remodels.

Q: Justin Kleber asked about weather impact and House of Sport impact on Fieldhouse.

A: Lauren Hobart and Navdeep Gupta explained weather had minimal material impact, and House of Sport elements are translating to Fieldhouse stores.