Academy Sports & Outdoors (ASO) Q2 2025 earnings summary

Executive summary

• Q2 2024 net sales were $1.55 billion, down 2.2% year-over-year, with comparable sales down 6.9% due to lower transactions, weather events, and distribution center issues, partially offset by new store openings and a slight increase in average ticket.

• Net income for Q2 2024 was $142.6 million, down 9.2% from the prior year, with diluted EPS at $1.95 and adjusted diluted EPS at $2.03.

• Gross margin improved by 50 basis points to 36.1%, driven by inventory cost management and lower freight expense, despite increased promotional activity.

• Positive comp was achieved in August, driven by back-to-school and broad-based category strength.

• New store growth, omni-channel expansion, and loyalty program initiatives are key strategic focuses, with nine new stores set to open in the upcoming quarter.

Financial highlights

• Year-to-date net sales were $2.91 billion, down 1.8% year-over-year; Q2 net income was $142.6 million, with adjusted net income at $148.6 million.

• Adjusted EBITDA for Q2 2024 was $232.5 million; adjusted diluted EPS was $2.03.

• Operating cash flow for the first half of 2024 increased to $291.0 million from $243.6 million last year.

• Adjusted free cash flow year-to-date was $217.3 million, up 60% from the prior year.

• SG&A expense was $368.6 million, up 4.6% year-over-year, mainly due to growth initiatives and deleverage from lower sales.

Outlook and guidance

• Full-year sales forecast revised to $5.90–$6.08 billion, a 4.3% to 1.4% decline year-over-year; comp sales expected to be -6% to -3%.

• Gross margin guidance maintained at 34.3%–34.7%.

• Adjusted net income expected at $420–$480 million; adjusted EPS at $5.75–$6.50.

• Adjusted free cash flow expected at $290–$340 million, with CapEx of $175–$225 million, 55% allocated to new stores.