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Academy Sports & Outdoors, Inc.

ASO
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Business Summary

Academy Sports + Outdoors is a prominent full-line sporting goods and outdoor recreation retailer operating 322 stores across 21 contiguous states in the United States as of January 31, 2026 . The company's mission is to provide "Fun for All" through a localized merchandising strategy and value proposition that resonates with a broad consumer base . The product assortment extends beyond traditional sporting goods and apparel to include outdoor recreation items, offered through both leading national brands and a portfolio of 19 private label brands .

The core business model revolves around generating revenue from in-store and e-commerce merchandise sales, complemented by other sales such as gift card breakage income, credit card bounties and royalties, and shipping income . The company emphasizes a value-based assortment, strong customer loyalty, and a regional focus primarily in the southern United States . Approximately 78% of 2025 merchandise sales were comprised of national brand products, with the remaining 22% from private label brands . No single national brand accounted for more than approximately 12% of 2025 sales . The company's omnichannel strategy, leveraging buy-online-pickup-in-store (BOPIS) and shipping fulfillment, is emerging, growing, and profitable .

The merchandise is organized into four divisions: Outdoors, Sports & Recreation, Apparel, and Footwear . For the fiscal year ended January 31, 2026, Outdoors contributed $1,831,038 thousand in sales, representing 31% of net sales . Sports and Recreation generated $1,339,608 thousand in sales, accounting for 22% of net sales . Apparel sales were $1,645,642 thousand , making up 27% of net sales , and Footwear sales totaled $1,201,545 thousand , representing 20% of net sales . Other sales amounted to $35,581 thousand .

For the fiscal year ended January 31, 2026 (2025), Academy Sports + Outdoors reported net sales of $6,053,414 thousand , an increase of 2.0% from the prior fiscal year . Gross margin for 2025 was $2,105,613 thousand , or 34.8% of net sales . Operating income was $512,184 thousand , representing an operating margin of 8.5% . Net income for the period was $376,768 thousand , resulting in diluted EPS of $5.54 . Cash and cash equivalents stood at $330,320 thousand as of January 31, 2026. Total long-term debt, net, was $480,793 thousand . Adjusted Free Cash Flow for 2025 was $262,761 thousand .

Comparing fiscal year 2025 to fiscal year 2024, net sales increased by $119,964 thousand , or 2.0% . This growth was driven by increased sales in the sports and recreation division by 3.6% , apparel by 2.4% , footwear by 1.2% , and outdoors by 1.2% . Gross margin as a percentage of net sales increased by 90 basis points, from 33.9% in 2024 to 34.8% in 2025 , primarily due to favorability in merchandise margin from promotions and price management in response to tariff costs . Selling, general and administrative (SG&A) expenses increased by $120,608 thousand , or 8.2% , to $1,593,429 thousand in 2025, mainly due to strategic investments of $109.0 million , including $84.8 million in new stores and $13.1 million in technology . E-commerce net sales increased by 13.6% in 2025 compared to 2024, representing 11.7% of merchandise sales for 2025, up from 10.5% in 2024 .

During fiscal year 2025, the company opened 24 new stores . Since re-launching its new store program in 2022, a total of 63 new stores have been opened , with 39 of these having been open for at least twelve months . These 39 stores averaged approximately $13 million in net sales per store over the last twelve months, including e-commerce . The company also launched its loyalty platform, myAcademy Rewards, in July 2024 , to deepen customer connection and understanding .

Business Outlook

Academy Sports + Outdoors plans to open 20 to 25 new stores in fiscal year 2026 , continuously evaluating available locations that meet its size requirements and market criteria . The strategic real estate approach, including the 63 stores opened since fiscal year 2021 , has positioned the company for continued expansion .

The company expects capital expenditures for fiscal year 2026 to be between $200 million and $240 million . The forecasted allocation of these capital expenditures for fiscal year 2026 is 60% for new stores , 20% for corporate, e-commerce, and information technology programs , and 20% for existing stores, distribution centers, and other . The company reviews and adjusts forecasted capital expenditures throughout the year based on business conditions .

The company expects its existing cash balances, internally generated cash flows, and available borrowings under its ABL Facility to fulfill anticipated obligations such as capital expenditures, dividends, stock repurchases, working capital needs, and scheduled debt maturities for the foreseeable future . As of January 31, 2026, the company had $992.4 million of available capacity under its ABL Facility and $330.3 million of cash and cash equivalents .

Risk Factors

The company faces various material risks, including its high dependence on the U.S. economy and consumer discretionary spending, which could be negatively affected by economic downturns, inflation, or changes in consumer confidence . Reliance on internationally manufactured merchandise, particularly from countries like China, Bangladesh, Vietnam, Cambodia, and Brazil, exposes the company to risks such as changes in tariffs and duties, quotas, shipping delays, supply chain disruptions, and increased compliance costs due to evolving global trade policies like the Uyghur Forced Labor Prevention Act (UFLPA) . Operational disruptions or failures in information systems, including those related to machine learning and artificial intelligence, could negatively impact business operations and financial results . Intense competition in the sporting goods and outdoor recreation retail industries from various formats, including mass merchants, department stores, large format sporting goods stores, specialty retailers, and online retailers, could limit growth and reduce profitability . The company is also exposed to risks related to managing inventory balances, as overstocking unpopular merchandise or shortages of popular items could negatively affect sales and profitability . Disruptions to the distribution network or timely receipt of inventory, due to factors like fuel prices, labor shortages, or natural disasters, could adversely impact sales or increase transportation costs . The company's store growth plans face challenges in site selection, real estate transactions, construction, staffing, and integration, with no assurance that new stores will achieve comparable sales or profitability to existing ones . Furthermore, the company is subject to payment-related risks, including fraud and compliance with evolving regulations, and the occurrence of severe weather events, catastrophic public health events, natural or man-made disasters, social and political conditions, or civil unrest could significantly damage retail locations or disrupt operations . The geographic concentration of stores primarily in the southern United States subjects the company to regional economic, weather, and disaster risks . Fluctuations in merchandise costs, commodity prices, and other factors could negatively impact operating results . The company's dependence on approximately 1,500 suppliers exposes it to risks of supply disruption and loss of purchasing incentives . Private label brand merchandise carries risks associated with sourcing, manufacturing, marketing, product safety, and intellectual property . Failure of third-party vendors for outsourced business services could adversely affect operations . Harm to the company's reputation due to negative publicity or perceptions could impact its ability to attract and retain customers, team members, and vendors . Quarterly operating results and comparable sales are subject to seasonal fluctuations and other uncontrollable factors . Legal and regulatory risks include compliance with laws affecting consumer products, firearms, ammunition, and related accessories, which represented approximately 6% of net sales in 2025 , as well as potential claims, demands, and lawsuits, with no guarantee that insurance or indemnities will be sufficient to cover damages . The company's level of indebtedness, approximately $85.8 million outstanding under the Term Loan and $400.0 million under the Notes as of January 31, 2026, requires dedication of cash flows to debt service, reduces funds for other corporate purposes, and may hinder favorable negotiations with landlords and vendors . Variable rate indebtedness exposes the company to interest rate risk, with a hypothetical 100 basis point increase in interest rates on current borrowings under the Term Loan and ABL Facility increasing interest expense by approximately $0.9 million .

Management Priorities

Management's message to shareholders emphasizes a mission to provide "Fun for All" through a localized merchandising strategy and value proposition that deeply connects with a broad range of consumers. The company is focused on implementing and continually improving customer-centric marketing technologies, omnichannel services, and experiences to save customers time and money while improving the long-term health of its customer portfolio . Management highlights the launch of the myAcademy Rewards loyalty platform in July 2024 as a powerful tool to build deeper connections and understanding of customers . The company plans to open 20 to 25 new stores in fiscal year 2026 and expects capital expenditures for fiscal year 2026 to be between $200 million and $240 million . A key strategic priority is the continued investment in the expansion and enhancement of omnichannel capabilities, including the mobile application, website experience optimization, fulfillment improvements, and emerging digital commerce capabilities such as artificial intelligence-enabled shopping experiences and social and marketplace commerce integrations .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Who We Are
  2. [2] Item 1, Business — Who We Are
  3. [3] Item 1, Business — Who We Are
  4. [4] Item 1, Business — Who We Are
  5. [5] Item 1, Business — Who We Are
  6. [6] Item 1, Business — Who We Are
  7. [7] Item 7, MD&A — Components of Our Results of Operations
  8. [8] Item 1, Business — Who We Are
  9. [9] Item 1, Business — Who We Are
  10. [10] Item 1, Business — Who We Are
  11. [11] Item 1, Business — Who We Are
  12. [12] Item 1, Business — Merchandising
  13. [13] Item 1, Business — Merchandising
  14. [14] Item 7, MD&A — Overview
  15. [15] Item 1, Business — Merchandising
  16. [16] Item 7, MD&A — Overview
  17. [17] Item 1, Business — Merchandising
  18. [18] Item 7, MD&A — Overview
  19. [19] Item 1, Business — Merchandising
  20. [20] Item 7, MD&A — Overview
  21. [21] Item 1, Business — Merchandising
  22. [22] Item 7, MD&A — Results of Operations
  23. [23] Item 7, MD&A — Results of Operations
  24. [24] Item 7, MD&A — Results of Operations
  25. [25] Item 7, MD&A — Results of Operations
  26. [26] Item 7, MD&A — Results of Operations
  27. [27] Item 7, MD&A — Results of Operations
  28. [28] Item 7, MD&A — Results of Operations
  29. [29] Item 7, MD&A — Results of Operations
  30. [30] Item 7, MD&A — Liquidity and Capital Resources
  31. [31] Item 7, MD&A — Liquidity and Capital Resources
  32. [32] Item 7, MD&A — Adjusted Free Cash Flow
  33. [33] Item 7, MD&A — Results of Operations
  34. [34] Item 7, MD&A — Results of Operations
  35. [35] Item 7, MD&A — Results of Operations
  36. [36] Item 7, MD&A — Results of Operations
  37. [37] Item 7, MD&A — Results of Operations
  38. [38] Item 7, MD&A — Results of Operations
  39. [39] Item 7, MD&A — Results of Operations
  40. [40] Item 7, MD&A — Results of Operations
  41. [41] Item 7, MD&A — Results of Operations
  42. [42] Item 7, MD&A — Results of Operations
  43. [43] Item 7, MD&A — Results of Operations
  44. [44] Item 7, MD&A — Results of Operations
  45. [45] Item 7, MD&A — Results of Operations
  46. [46] Item 7, MD&A — Results of Operations
  47. [47] Item 7, MD&A — Results of Operations
  48. [48] Item 7, MD&A — Results of Operations
  49. [49] Item 7, MD&A — Results of Operations
  50. [50] Item 7, MD&A — Results of Operations
  51. [51] Item 7, MD&A — Results of Operations
  52. [52] Item 7, MD&A — Overview
  53. [53] Item 7, MD&A — Net Sales
  54. [54] Item 7, MD&A — Net Sales
  55. [55] Item 7, MD&A — Net Sales
  56. [56] Item 7, MD&A — Net Sales
  57. [57] Item 1, Business — Marketing
  58. [58] Item 1, Business — Marketing
  59. [59] Item 7, MD&A — Net Sales
  60. [60] Item 7, MD&A — Net Sales
  61. [61] Item 7, MD&A — Net Sales
  62. [62] Item 7, MD&A — Net Sales
  63. [63] Item 7, MD&A — Capital Expenditures
  64. [64] Item 7, MD&A — Capital Expenditures
  65. [65] Item 7, MD&A — Capital Expenditures
  66. [66] Item 7, MD&A — Capital Expenditures
  67. [67] Item 7, MD&A — Capital Expenditures
  68. [68] Item 7, MD&A — Future Liquidity
  69. [69] Item 7, MD&A — Future Liquidity
  70. [70] Item 7, MD&A — Future Liquidity
  71. [71] Item 7, MD&A — Future Liquidity
  72. [72] Item 7, MD&A — Future Liquidity
  73. [73] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  74. [74] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  75. [75] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  76. [76] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  77. [77] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  78. [78] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  79. [79] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  80. [80] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  81. [81] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  82. [82] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  83. [83] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  84. [84] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  85. [85] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  86. [86] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  87. [87] Item 1A, Risk Factors — Risks Related to Our Business and Industry
  88. [88] Item 1A, Risk Factors — Legal and Regulatory Risks
  89. [89] Item 1A, Risk Factors — Legal and Regulatory Risks
  90. [90] Item 1A, Risk Factors — Risks Related to Our Indebtedness
  91. [91] Item 1A, Risk Factors — Risks Related to Our Indebtedness
  92. [92] Item 1A, Risk Factors — Risks Related to Our Indebtedness
  93. [93] Item 7A, Quantitative and Qualitative Disclosures About Market Risk
  94. [94] Item 1, Business — Marketing
  95. [95] Item 1, Business — Marketing
  96. [96] Item 1, Business — Marketing
  97. [97] Item 7, MD&A — Net Sales
  98. [98] Item 7, MD&A — Capital Expenditures
  99. [99] Item 7, MD&A — Net Sales

Analysis on 5/22/2026