Shares of Foot Locker (FL) surged Monday after the company previewed its stronger-than-expected second-quarter report. Stocks shot up nearly 8% as the company attributed its performance to consumers using stimulus checks to buy shoes, in-store and online. The full report will be released on Aug. 21.
According to Foot Locker’s preview, locations open for at least a year saw an increase in business of around 18% during the second quarter. Estimates had the company doing much worse, predicting a 20% drop-off for these same locations.
“As we continued to reopen stores throughout the quarter, we saw a strong customer response to our assortments, which we believe was aided by pent-up demand and the effect of fiscal stimulus,” CEO Richard Johnson said. “This fueled our in-store sales and also drove continued momentum across our digital channels… While these undoubtedly remain challenging times, we are nonetheless pleased by the health of our category.”
Despite these surprises, Foot Locker’s stock still remains down over 25% for the year as the sneaker industry overall takes a major tumble due to COVID-19. Other leaders in the sector like Nike, Adidas, and Under Armour have also posted losses or struggled to stay afloat in recent months.
Moving forward, Foot Locker said that it would not be providing any sort of fiscal outlook for the remainder of 2020. This is due to the continued uncertainty during the pandemic and the potential downturn of the lucrative back-to-school shopping season.
Shares of Foot Locker closed at $29.63 per share on Monday, up 7.82%.