×

Foot Locker shares jump 11 percent as basketball shoe sales regain footing

Kevin Durant and Stephen Curry
Kevin Durant and Stephen Curry

Foot Locker shares jumped more than 11 percent Friday, pushing them into positive territory for the year, as the athletic footwear retailer reported improved sales from the first quarter.

During the fiscal second quarter, Foot Locker's same-store sales rose 4.7 percent, topping Wall Street's expectations for 3.9 percent growth and improving over the prior three-month period. During the first quarter, comparable sales in its basketball business turned negative for the first time in years, fueling concerns that the popular segment was starting to cool.

But comparable sales in this segment returned to positive territory during the second quarter, logging mid-single-digit growth.

"Within the second quarter, we drove comparable sales gains across basketball, running, and classic footwear, as well as apparel," CEO Richard Johnson said. "We also posted gains in all regions and channels in which we operate."

The latest shoes from Stephen Curry and Kevin Durant helped boost the company's sales in that segment. Momentum should continue in basketball during the back half of the year as new products come to market, Johnson said. The red-hot Adidas brand, which grew its revenues by 21 percent on a constant currency basis in the latest quarter, also contributed to Foot Locker's growth.

Johnson shrugged off the closing of anchor tenants such as Macy's, likening Foot Locker's appeal to that of Apple.

"There's only a couple of places where people will line up for products," Johnson said. "We know that our core consumers want to be in our stores."

Foot Locker earned 94 cents a share during the second quarter, topping analysts' estimates by 4 cents and rising 12 percent over the prior year. Revenue of $1.78 billion also topped estimates.