JD Sports Fashion has lowered its full-year profit guidance after weaker trading in North America pushed group like-for-like sales further into decline during the second quarter.
The FTSE 100 sportswear retailer now expects profit before tax and adjusting items of between £700m and £800m for its 2026/27 financial year, down from its previous guidance of £750m to £850m. JD generated £852m on the same measure in the year to January 2026.
Group like-for-like sales fell 3.1% in the 13 weeks to 1 August, worsening from a 2.5% decline during the first quarter. Performance varied sharply across JD’s major regions, with North American like-for-like sales falling 6.8% and Europe declining 2.7%.
The UK provided a more positive counterpoint, with like-for-like sales increasing 0.8%, while Asia Pacific recorded growth of 1.4%.
JD attributed the North American weakness to softer consumer sentiment, a slower period for high-demand footwear releases, and some back-to-school spending moving from July into the first half of August. The retailer is also operating in a sportswear market where promotional activity remains elevated as brands and retailers compete for discretionary consumer spending.
The deterioration in North America carries particular weight for JD after several years of expansion in the region. North America generated £4.78bn of the group’s £12.66bn revenue in the year to January 2026, representing 38% of total sales and making it JD’s largest geographic market.
It was also responsible for £353m of operating profit before adjusting items and after lease interest, or around 40% of the group total. However, North American operating margin fell to 7.4% in FY26 from 9.9% a year earlier, showing that the expansion of the business has not been matched by the same level of profitability.
JD has been working to strengthen its position in the region following the acquisition of Hibbett and continued investment in its store estate. Its priorities for the current financial year include accelerating Finish Line and City Gear store conversions, improving productivity at underperforming locations, broadening its product range, and completing a global e-commerce re-platforming programme.
The latest trading figures increase the pressure on those initiatives to translate into stronger underlying sales. When JD published its full-year results in May, it said organic sales had risen 2.1% during FY26, while total revenue increased 10.5% to £12.66bn. Profit before tax and adjusting items nevertheless fell 7.7% to £852m, illustrating the tension between the group’s expanded scale and pressure on profitability.
JD entered the current year expecting subdued near-term market growth. Its own market assessment points to a sports fashion sector that expanded rapidly during and immediately after the pandemic but is now normalising, with fewer highly sought-after footwear launches and increased competition. The company expects the global sportswear market to grow by an average of around 2% to 3% annually over the medium term.
Footwear product cycles are particularly important to JD because scarcity, new silhouettes, and exclusive launches have traditionally helped premium sportswear retailers support customer demand without relying heavily on discounting. A weaker pipeline of standout products can increase promotional pressure across the market and make consumers more willing to delay purchases.
At the same time, JD is continuing to return cash to shareholders. Earlier this month, it launched the second £100m tranche of its £200m annual share buyback programme, with the latest tranche expected to run until the end of the financial year in January 2027. The programme forms part of a capital allocation strategy announced alongside its FY26 results, which also includes investment in store productivity, technology, and supply chain infrastructure.
The retailer had previously targeted free cash flow of £460m to £520m for FY27 and gross capital expenditure of approximately £400m, alongside efforts to improve operating margins over the medium term. Its revised profit range now places greater focus on trading through the remainder of the year, particularly in North America and during the important autumn and Christmas periods.
JD is due to report its first-half results on 23 September, when investors will receive a fuller picture of margins, costs, cash generation, and inventory levels following the weaker second-quarter sales performance.
You must be logged in to post a comment.