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Acquisition of Foot Locker
 3 Months Ended
May 02, 2026
Business Combination [Abstract]  
Acquisition of Foot Locker Acquisition of Foot Locker
On September 8, 2025, the Company acquired Foot Locker, Inc., a leading footwear and apparel retailer (the “Transaction”), which became a wholly-owned subsidiary of DICK’S Sporting Goods. Total purchase consideration for the Transaction was $2.5 billion, which was primarily funded by $2.1 billion in share consideration for the issuance of 9.6 million shares of the Company’s common stock, $223.0 million in cash consideration and $111.6 million from the Company’s pre-existing equity ownership in Foot Locker.
Preliminary Purchase Price Allocation
The Transaction is accounted for as a business combination under the acquisition method in accordance with ASC 805, Business Combinations. The following table summarizes the preliminary purchase price allocation of the estimated fair values of assets acquired and liabilities assumed as of September 8, 2025:
(in thousands)September 8, 2025
Cash and cash equivalents$484,882 
Accounts receivable and other receivables147,432 
Inventories1,718,069 
Prepaid expenses and other current assets233,693 
Property and equipment706,305 
Operating lease assets1,876,206 
Intangible assets710,000 
Goodwill572,829 
Deferred income tax assets77,471 
Other assets144,264 
Accounts payable(590,654)
Accrued expenses(482,704)
Current operating lease liabilities(443,533)
Deferred revenue and other liabilities(113,509)
Long-term debt and financing lease obligations(420,760)
Long-term operating lease liabilities(1,876,709)
Deferred income tax liabilities(167,295)
Other long-term liabilities(63,325)
Total preliminary purchase price$2,512,662 
The fair value of assets acquired and liabilities assumed are preliminary and based on the Company’s estimates and assumptions as of the acquisition date and are subject to change as additional information is obtained within the measurement period which will not exceed twelve months from the date of the Transaction. As such, the purchase price allocation may be revised and the impact may be material. During the 13 weeks ended May 2, 2026, adjustments to the preliminary purchase price allocation resulted in a $46.0 million decrease in goodwill primarily related to the settlement of litigation contingencies, refinement of the fair value of long-lived assets and income taxes. The adjustments made during the first quarter of fiscal 2026 did not result in a significant impact to the Consolidated Statement of Income. The most significant areas of acquisition accounting not considered final are litigation contingencies and income taxes, which may also impact the total goodwill recognized.
Goodwill
Goodwill is calculated as the excess consideration over the net assets acquired and attributable to future economic benefits expected resulting from the Transaction, including the assembled workforce of Foot Locker, sales and growth opportunities expanding into new markets and synergies post-combination. Approximately $24.0 million of the total preliminary goodwill recognized in acquisition accounting is deductible for tax purposes. Goodwill recognized will be tested periodically for impairment as required by ASC 350 Intangibles - Goodwill and Other.
The following table presents changes in the carrying amount of goodwill recorded in the Company’s Consolidated Balance Sheets, summarized by reportable segment, including amounts recognized as part of the Transaction within the Foot Locker reportable segment (in thousands):
DICK’SFoot LockerTotal
Balance as of January 31, 2026$245,857 $618,190 $864,047 
Measurement period adjustments— (46,011)(46,011)
Currency translation— (4,967)(4,967)
Balance as of May 2, 2026$245,857 $567,212 $813,069 
Results of operations
The Foot Locker reportable segment contributed net sales of $1.8 billion and segment profit of $17.5 million during the 13 weeks ended May 2, 2026.
Unaudited proforma financial information
The following unaudited proforma combined financial information presents the combined results of the Company as if the Transaction had been completed on February 4, 2024. The unaudited proforma combined financial information is provided for informational purposes only and may not be indicative of the operating results that would have occurred if the Transaction had occurred on February 4, 2024, nor is it indicative of the future results of the Company following the Transaction.
13 Weeks Ended
(in thousands, except per share amounts)May 3,
2025
Net sales$4,968,767 
Net income$43,778 
Basic earnings per common share$0.49 
Diluted earnings per common share$0.48 
The unaudited proforma information for the period presented includes the following accounting impacts resulting from the Transaction: (i) compensation expense for the fair value of the replacement equity awards; (ii) depreciation expense on property and equipment; (iii) lease expense, including favorable/unfavorable market terms, for acquired leases; (iv) interest expense for the senior notes due 2029; and (v) the elimination of the goodwill impairment charge of $110 million recorded in Foot Locker’s condensed consolidated statement of operations for the 13 weeks ended May 3, 2025. The unaudited proforma financial information does not reflect any anticipated synergies or dis-synergies, operating efficiencies, or cost savings that may result from the integration costs that may be incurred.
Weighted average common shares outstanding in the calculation of basic and diluted earnings per share for the period presented was adjusted to include the dilutive effect of 9.6 million shares of DICK’S Sporting Goods common stock issued as consideration for the Transaction.
Organizational Alignment
On March 23, 2026, the Company eliminated certain positions within the Foot Locker Business and is requiring other positions to relocate to Foot Locker’s headquarters in New York City. These actions are intended to better align the organizational design and spending in support of the Company’s go-forward vision for the Foot Locker segment and are expected to result in approximately $45 to $55 million of charges, which were included within the previously disclosed expectation of $500 to $750 million of total acquisition-related charges. During the 13 weeks ended May 2, 2026, the Company recorded charges of $38.4 million within merger and integration costs on the Consolidated Statement of Income, of which $20.1 million was reflected within accrued expenses on the Company’s Consolidated Balance Sheet as of May 2, 2026 and are expected to be paid over the next twelve months.