JD Sports Global Sales Decline Amid Cost-of-Living Pressures

The company's share price plummeted by approximately 14% on Thursday.

JD Sports now projects full-year pre-tax profits will range between £700 million and £800 million, a significant reduction from its earlier projections of £750 million to £850 million.

The retailer relies heavily on non-essential spending from younger customers; these consumers are reportedly squeezed by relentless cost-of-living pressures, including higher fuel prices, which has dragged on global sales.

Pressure on consumer spending particularly impacted footwear sales, especially for hotly anticipated launches or limited-edition trainers, amid an increased level of discounting.

Weaker trading in the first half of the year reportedly stemmed from incremental cost-of-living pressures on its core consumer from continued inflation, including higher fuel prices.

Regis Schultz confirmed that "Trading in the second quarter remained tough."

He added that the market stayed highly promotional, reflecting consumer and footwear product cycle headwinds, while the core consumer was impacted by incremental cost-of-living pressures.

Schultz further noted that North America experienced the most acute impact, also reflecting a slower quarter for high-heat footwear product and the timing of back-to-school demand.

Despite the global decline, the UK delivered a strong quarter, buoyed by robust football replica kit sales and an improved performance in its outdoor business.

In the UK, sales increased by 0.8% year-on-year, supported by spending on outdoor products and football replica kits.

Widespread inflation has reportedly hit shoppers’ wallets, resulting in falling sales across important markets such as the US.

Cost-of-living pressures, reportedly fuelled by the US war on Iran, also weighed on trainer sales.

JD Sports claims the wider drop-off in consumer spending would likely persist into the second half of the year.