Dick's Sporting Goods suffered its worst single-day stock drop in company history on Tuesday, with shares falling roughly 30 percent after the retailer reported weaker-than-expected second-quarter earnings and revenue and cut its full-year profit outlook. The selloff surpassed the previous record drop of 24 percent, which came after a missed earnings report in August 2023.
According to CNBC, the biggest problems were concentrated at Foot Locker, which Dick's acquired in September 2025. Comparable sales at the core Dick's business rose 4.9 percent, in line with analyst expectations. Foot Locker comps fell 3.6 percent, against Wall Street expectations for a slight increase. The company slashed its full-year outlook for Foot Locker sales while leaving its comparable-sales forecast for the Dick's chain unchanged.
CNBC's Jim Cramer said Tuesday that the collapse in Foot Locker's numbers reflects a wider slowdown across athletic footwear and apparel. Inventory has piled up around certain legacy sneaker styles and apparel brands as consumer preferences shift, pushing more discounting across the industry.
Cramer was direct about the acquisition. "Clearly, they're having trouble turning this business around," he said. "That shouldn't come as a surprise to anyone who watched the performance of Foot Locker's stock before the takeover bid."
Despite the grim near-term picture, Cramer told viewers the selloff may represent a buying opportunity for patient investors. He pointed to what happened after the 2023 earnings miss, when Dick's shares bottomed around $100 on Oct. 27 before surging roughly 150 percent to $250 over the next 15 months. "If you don't own Dick's, you dodged a bullet today, but based on the last time the stock fell apart, you might want to be a buyer over the next couple of months, because this company has a history of coming back from the dead," Cramer said.
He cautioned that the next quarter or two could remain difficult as retailers work through excess inventory. After Tuesday's drop, Dick's now trades at roughly nine times 2027 earnings, a reset that Cramer said makes the stock cheaper than it has been in some time.
Cramer said he still believes in Dick's long-term position as one of the few large-scale sporting-goods retailers remaining in the market. "I don't want to give up on Dick's down here," he said. "In the long-run, I'm a believer, because this is the only remaining sporting goods retailer with genuine scale, even if it's also joined at the hip with the struggling Foot Locker."
The results sent ripples through the broader footwear sector. MarketWatch reported that the drop hit other footwear giants as well, as shoppers pull back from retro sneaker styles without deeper discounts. The trend points to a broader shift in consumer preferences away from the legacy athletic styles that fueled much of the industry's growth in recent years.
The next major test for Dick's will come when the company reports third-quarter results, which will show whether the excess inventory problem at Foot Locker has begun to clear.
