Academy Sports Lifts Outlook As CFO Explains Tariff…

Academy Sports Lifts Outlook As CFO Explains Tariff Measures

Houston,,Tx,,Us-may,18,,2017:customer,Exit,Academy,Sports,+,Outdoors

Academy Sports and Outdoors, Inc. (NASDAQ:ASO) shares are trading lower on Tuesday.

The company reported second-quarter adjusted earnings per share of $1.94, missing the analyst consensus estimate of $2.16. Quarterly sales of $1.599 billion (+3.3% year over year) missed the Street view of $1.614 billion.

Academy Sports and Outdoors reported that in the second quarter, comparable sales rose by 0.2%.

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“As we head into the back half of the year, we believe momentum is building in the business and we are confident in our strategy and ability to come out of this year better positioned than ever to serve our customers and drive long-term growth,” said Steve Lawrence, Chief Executive Officer.

Gross profit in the quarter under review expanded to $576.73 million, higher than $558.725 million a year ago. Gross margin contracted to 36% from 36.1%.

Academy opened three new stores during the second quarter, bringing its total to 306 locations across 21 states.

The company plans to open a total of 20 to 25 stores in fiscal 2025.

The company exited the quarter with cash and equivalents worth $300.9 million, down 7.3% year over year.

Adjusted EBITDA in the quarter under review decreased to $212.484 million, lower than $232.490 million in the year-ago period.

Tariff Mitigation

The company says it has largely neutralized fiscal 2025 tariff impacts by sharing costs with factories and vendors, shifting country of origin where feasible, adjusting unit buys, pulling domestic inventory, and using pricing tools to lift Average Unit Retails (AURs).

It expects these steps to contain tariff effects while maintaining a strong value proposition for customers, and will apply similar tactics if new tariffs arise.

“Sales for the second quarter continued to improve, and we saw meaningful acceleration in our strategic initiatives. In addition, we believe we now have additional visibility into tariff impacts and are well positioned to mitigate them,” said Carl Ford, Chief Financial Officer.