Nasdaq:ASO
Academy Sports & Outdoors, Inc.
A discount specialty retailer offering a wide assortment of sporting goods and outdoor gear to value-conscious consumers in the United States.
Key Metrics
Investment Thesis
Bull Case
Investors may favor ASO for its resilient cash generation of over half a billion dollars and aggressive capital return program that returned nearly $400M to shareholders last year. The company's dominance in the discount sporting goods niche offers a defensive profile during economic downturns, supported by a vast store footprint that drives high traffic volumes.
Bear Case
Concerns arise from a three-year revenue contraction from $6.40B to $5.93B and a similar decline in net income from $628M to $418M, suggesting secular headwinds or operational inefficiencies. With retained earnings at a deficit of $1.76B, the company's ability to weather prolonged periods of low profitability without diluting equity or increasing debt is a key question.
About Academy Sports & Outdoors, Inc.
Academy Sports & Outdoors is a leading specialty retailer serving consumers with sporting goods, outdoor equipment, and fitness apparel across North America. The company operates primarily through its Academy Sports + Outdoors banner, focusing on price-sensitive shoppers seeking high-value merchandise in categories like hunting, fishing, and team sports.
Analysis
Management Discussion
Despite a sequential revenue decline to $5.93B, operating cash flow remains robust at $528.1M, allowing for significant share repurchases of $364.9M and dividends of $31.5M. However, the net change in cash was negative $59.0M due to substantial capital expenditures of $199.6M and financing outflows, indicating a heavy investment cycle or buyback execution year. The reduction in accounts receivable by $2.6M suggests improved collection efficiency or a shift in sales mix.
Industry Overview
The specialty sporting goods industry is highly competitive with both traditional brick-and-mortar players and aggressive online retailers vying for market share. Success in this sector depends on omnichannel integration, inventory turnover efficiency, and the ability to offer exclusive or private-label products that differentiate from mass-market big-box retailers.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $6.40B | $6.16B | $5.93B |
| Cost of Revenue | $4.18B | $4.05B | $3.92B |
| Gross Profit | $2.21B | $2.11B | $2.01B |
| Operating Expenses | $1.37B | $1.43B | $1.47B |
| Operating Income | $846.5M | $677.9M | $538.6M |
| G&A | $1.37B | $1.43B | $1.47B |
| Stock-Based Comp | $21.2M | $24.4M | $26.6M |
| D&A | $106.8M | $110.9M | $118.1M |
| Depreciation | $106.8M | $110.9M | $118.1M |
| Other OpEx | $0 | $0 | $0 |
| Non-Operating Income | $-28.2M | $-14.7M | $-414.0K |
| Pre-Tax Income | $818.3M | $663.2M | $538.2M |
| Income Tax | $190.3M | $144.0M | $119.8M |
| Continuing Ops | $628.0M | $519.2M | $418.4M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $628.0M | $519.2M | $418.4M |
| Minority Interest | $0 | $0 | $0 |
| Net to Common | $628.0M | $519.2M | $418.4M |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Current Assets | $1.69B | $1.64B | $1.71B |
| Cash & Equivalents | $337.1M | $347.9M | $288.9M |
| Accounts Receivable | $16.5M | $19.4M | $16.8M |
| Inventory | $1.28B | $1.19B | $1.31B |
| Prepaid Expenses | $47.7M | $83.5M | $95.6M |
| Other Current Assets | $1.8M | $0 | $0 |
| Long-Term Assets | $2.91B | $3.03B | $3.19B |
| PP&E (Net) | $351.4M | $445.2M | $525.1M |
| Intangibles | $577.7M | $578.2M | $579.0M |
| Goodwill | $861.9M | $861.9M | $861.9M |
| Operating Leases | $1.10B | $1.11B | $1.17B |
| Other LT Assets | $17.6M | $35.2M | $51.7M |
| Total Assets | $4.60B | $4.68B | $4.90B |
| Current Liabilities | $1.04B | $879.9M | $960.9M |
| Accounts Payable | $686.5M | $541.1M | $612.4M |
| Current Debt | $3.0M | $3.0M | $3.0M |
| Current Leases | $109.1M | $117.8M | $115.1M |
| Deferred Revenue | $92.6M | — | — |
| Taxes Payable | $6.2M | $9.3M | $6.1M |
| Other Current Liab | $141.4M | $208.6M | $224.2M |
| Long-Term Liabilities | $1.93B | $1.84B | $1.94B |
| Long-Term Debt | $584.5M | $484.6M | $482.7M |
| LT Operating Leases | $1.07B | $1.09B | $1.19B |
| Other LT Liab | $271.8M | $266.4M | $267.6M |
| Total Liabilities | $2.97B | $2.72B | $2.90B |
| Shareholders' Equity | $1.63B | $1.95B | $2.00B |
| Paid-In Capital | $216.2M | $242.1M | $247.1M |
| Retained Earnings | $1.41B | $1.71B | $1.76B |
| Total L&E | $4.60B | $4.68B | $4.90B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $628.0M | $519.2M | $418.4M |
| Non-Cash Adjustments | $-151.4M | $160.0M | $-84.3M |
| Working Capital Changes | $75.4M | $-143.4M | $194.0M |
| Cash from Operations | $552.0M | $535.8M | $528.1M |
| Capital Expenditures | $108.3M | $207.8M | $199.6M |
| Cash from Investing | $-108.8M | $-206.1M | $-186.1M |
| Share Buybacks | $489.5M | $202.8M | $364.9M |
| Dividends Paid | $24.6M | $27.2M | $31.5M |
| Cash from Financing | $-592.1M | $-318.9M | $-401.0M |
| FX Effect | $0 | $0 | $0 |
| Net Change in Cash | $-148.9M | $10.8M | $-59.0M |
| Beginning Cash | $486.0M | $337.1M | $347.9M |
| Ending Cash | $337.1M | $347.9M | $288.9M |
Frequently Asked Questions
How does Academy Sports & Outdoors, Inc. make money?
Revenue is driven by four core categories: Sporting Goods (equipment for team sports and recreation), Outdoor (hunting, fishing, and camping gear), Fitness (apparel and equipment for home gyms), and Footwear & Apparel. These segments collectively generate over $5.9B in annual revenue with a gross profit margin of approximately 34%.
What are the main risks for ASO?
Inventory management is critical given the $1.31B in inventory held; any misjudgment in seasonal demand or product mix can lead to significant write-downs. The retail sector faces margin pressure from rising logistics costs and intense competition from both brick-and-mortar rivals and pure-play e-commerce giants. A slowdown in discretionary consumer spending or economic recession could disproportionately impact the company's price-sensitive customer base.
What is ASO's competitive advantage?
The company leverages an extensive omnichannel presence combining large-format retail stores with e-commerce to capture both online and offline demand. Its private label offerings provide higher margins and brand loyalty, while its supply chain efficiency allows it to maintain lower price points than direct competitors like Dick's Sporting Goods.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.