Academy Sports and Outdoors (ASO) Q2 Earnings call transcript Sep 10, 2025

In the second quarter of fiscal 2024, Academy Sports and Outdoors reported a decline in sales and faced several operational challenges, according to the company's recent earnings call. Despite these setbacks, the company remains optimistic about its long-term growth prospects and is taking steps to mitigate the impact of external factors on its business.

Financial Performance

Academy Sports and Outdoors recorded sales of $1.55 billion for the second quarter, marking a 2.2% decrease from the previous year. This decline was attributed to a challenging retail environment for the sports and outdoor categories, with the active young families that the company primarily serves experiencing reduced spending power due to inflation and increased credit card debt. The company also faced hurdles from natural disasters, such as storms and hurricanes, which disrupted business operations and resulted in lost sales.

Growth Strategies

Despite these challenges, Academy Sports and Outdoors remains committed to its growth strategies, including expanding its store base, building a more powerful omnichannel business, and driving greater productivity out of its existing businesses. The company has opened new stores in Ohio and plans to expand its presence in the state, with a focus on quickly building density in these new markets. It also launched myAcademy Rewards, a loyalty program designed to attract and retain customers through personalized offers, deals, and products.

Operational Challenges

The company faced operational challenges during the quarter, with the conversion of its Georgia distribution center to a new warehouse management system causing out-of-stocks and impacting sales. However, the team is working to address these issues and expects to be fully caught up by the holiday season.

Outlook

Looking ahead, Academy Sports and Outdoors expects sales for the full year to range from $5.9 billion to $6.07 billion, with a negative 4% to negative 1% decline in total sales versus last year and a negative 6% to negative 3% decline in comp sales. The company is taking steps to align its expenses with this revised forecast and remains focused on inventory control and promotional efforts around key shopping events.

Investor Relations

During the call, management provided updates on several key initiatives, including the performance of its new stores, the expansion of its omnichannel capabilities, and its efforts to manage costs and improve efficiency. Analysts asked questions about the company's merchandise mix, promotional strategy, and the impact of external factors on sales. Management provided detailed responses, offering insights into the company's operational and financial performance.

Conclusion

Academy Sports and Outdoors faces a challenging retail environment, with economic downturns and operational hurdles impacting its sales and profitability. However, the company remains focused on its growth strategies and is taking steps to mitigate the impact of external factors. With a strong focus on customer engagement, operational efficiency, and strategic expansion, Academy Sports and Outdoors is well-positioned to navigate the current market conditions and position itself for long-term success.