Foot Locker Shares Plunge After Missed Earnings and Guidance Cut
Foot Locker
shares plunged 25% in premarket trading Friday after the company missed earnings expectations and cut its guidance.
This is breaking news. Please check back for updates.
What Happened to Foot Locker?
Foot Locker, a popular athletic footwear and apparel retailer, reported disappointing earnings on Friday, May 21, 2021. The company reported earnings per share of $1.45, missing the average analyst estimate of $1.63 per share. Foot Locker’s revenue also fell short of expectations, coming in at $1.87 billion instead of the expected $1.94 billion.
In addition to missing earnings estimates, Foot Locker also cut its full-year 2021 guidance. The company now expects earnings per share to be in the range of $3.50 to $4.00, down from the previous estimate of $4.40 to $5.00 per share. Foot Locker cited the ongoing impact of the COVID-19 pandemic as a reason for the lowered guidance.
Market Reaction
Investors reacted negatively to Foot Locker’s disappointing earnings and lowered guidance. The company’s shares plunged 25% in premarket trading on Friday, May 21, 2021. The stock had already been under pressure in recent weeks due to concerns about rising competition and supply chain disruptions, but the earnings miss and lowered guidance added to the downward pressure.
What’s Next for Foot Locker?
Foot Locker is facing a challenging retail environment, with increasing competition from online retailers and other brick-and-mortar chains. The COVID-19 pandemic has only added to the difficulties facing the company, with many consumers shifting their shopping habits online.
However, Foot Locker’s management remains optimistic about the company’s long-term prospects. In a press release announcing the earnings, Foot Locker CEO Richard Johnson said, “We believe Foot Locker is well-positioned for the future and our team remains fully committed to executing on our growth initiatives and driving value for our shareholders.”
Investors will be watching closely to see if Foot Locker can deliver on those growth initiatives and regain investor confidence in the coming months.