Academy Sports and Outdoors, Inc.

Good morning and welcome to the Academy Sports and Outdoors first quarter 2026 earnings conference call. This call is being recorded and all participants are on a listen-only mode. Following the prepared remarks, there will be a brief question and answer session. Questions will be limited to analysts and investors. Please limit yourself to one question and one follow-up. To ask your question during the call, please press star 1 from your telephone keypad. If you require operator assistance during the call, please press star zero. I will now turn the call over to your host, Dan Aldridge, Vice President, Investor Relations for Academy Sports and Outdoors.

Good morning, everyone, and thank you for joining the Academy Sports and Outdoors first quarter fiscal 2026 financial results call. Participating on today's call are Steve Lawrence, Chief Executive Officer, and Carl Ford, Chief Financial Officer. As a reminder, today's earnings release and the comments made by management during this call include forward-looking statements. These statements are subject to risks and uncertainties that could cause our actual results to differ materially from our expectations and projections. These risks and uncertainties include, but are not limited to, the factors identified in today's earnings release and in our most recent Form 10-K and Form 10-Q filings. The company undertakes no obligation to revise any forward-looking statements. Today's remarks also refer to certain non-GAAP financial measures. Reconciliations to the most comparable GAAP measures are included in today's earnings release, which is available on our website at investors.academy.com. This morning, we will review our financial results for the first quarter of fiscal 2026, provide an update on our strategic initiatives, and discuss our outlook for the year. After we conclude prepared remarks, there will be time for questions. With that, I'll turn the call over to Steve.

Good morning, everyone, and welcome to our first quarter 2026 earnings call. Our plan this morning is to discuss our Q1 results while also updating you on the progress we're making against our long-term growth initiatives. Turning to our first quarter results, we were pleased to move back to comp store growth in Q1, with sales coming in at $1.44 billion, which was up 6.7% in total sales and translated into a 2.9% comp increase. Both the comp and total sales were on the high side of the range we communicated in our press release issued on April 7, 2026, in advance of our analyst day where we gave an update to our long-range plan and goals. These results were driven by a combination of a low single-digit positive traffic coupled with a high single-digit AUR increase. Units per transaction were down slightly, which we would attribute to the increased AUR. Positive results were broad-based, with our dot-com business comping up 17% in all four of our division's running increases for the quarter. Outdoor was our best-performing category at up 12%, driven by strength in fishing and shooting sports categories. Beneath the surface, our ammo business, which was a headwind for us most of last year, turned positive in February and accelerated after the conflict in the Middle East began. Our firearms business also continues to be a bright spot. And utilizing NICS checks data as a proxy, we have grown market share in this category for eight consecutive quarters. To help build on momentum in the shooting sports business, we launched the suppressors category into a limited door count during the first quarter, with a goal to roll them out to over 100 stores by the end of the year. This is a rapidly growing category in the industry, with a strong attachment rate to firearms and high AURs. Since suppressors are totally new to our assortment, this business should be 100% accretive and provide an additional tailwind for the shooting sports category throughout the remainder of this year and next. Sports and Recreation was our second best business at plus 6%, with the increase driven by solid gains in baseball, which fueled our team sports business during the first quarter. We also saw a double-digit growth in our front-end business. Normally, we don't call out front end, but we're seeing rapid growth in this area driven by the collectible trading card business, which has benefited from our increased investment in this category. In addition, we continue to see solid improvements in our outdoor speakers business, driven by the leadership position we've taken in Turtle Box. Apparel sales were also positive, plus 5%, with particular strength in our outdoor and work businesses, supported by expanded assortments from Carhartt, Burley Bow, Levi's, and our own Magellan Outdoors brand. We will continue to lean into the Work Western lifestyle trend with the addition of roughly 100 area shops in the back half of the year. On the athletic side of the business, gains were driven by continued momentum in the Nike and Jordan brand, coupled with double-digit increases in our better private brands of Freely and Rowe. In the second quarter, we plan to add 55 Jordan brand shops on our apparel pads, which will take our Jordan brand shop count to 200 stores and continue to fuel the growth in this business. Footwear sales were up 3% for the quarter. Key drivers of growth in Q1 were our cleated business driven by baseball, along with our summer seasonal businesses driven by Crocs and Birkenstock. We also remain encouraged by the momentum we're seeing in the performance running category, fueled by key platforms such as the Nike Vimero, the Adidas Evo SL, the New Balance Ellipse, and the Brooks Glycerin. Our plan is is to continue to build out our assortment in space devoted to this category as we progress throughout the remainder of the year. Based on the solid start to the year, we saw growth in market share across all of our businesses, both for the quarter and on a rolling 12-month basis. We've also driven a positive comp over that same 12-month period. We would attribute the momentum we're building in the business and the market share gains to the continued progress we're making against our three core growth strategies, which I will now give you a brief update on. New store expansion remains our number one growth lever, and we're starting to build critical mass behind this strategy. We began the year with 39 stores from our 2022 through 2024 vintages in our comp base. This tranche of stores continues to perform well, with sales copping in the high single digits. We anticipate this tailwind should accelerate as the 24 stores from our 2025 vintage start to flow into the comp base as we've crossed through the year. During the first quarter, we'll open up two new stores in Canton, Ohio and Muskogee, Oklahoma, both of which support our strategy to grow in mid-sized markets. These are underserved communities and tend to over-index with our core customer, the Always Game family. During second quarter, we'll open up three more stores with locations in Altoona, Pennsylvania, North Knoxville, Tennessee, and Morristown, Tennessee. The remaining 15 to 20 stores are expected to open in the back half of the year with a heavy focus in legacy and existing markets. As we head into 2027 and beyond, we'd expect to have a more balanced mix of openings between the first half and the second half of each year. Our second growth strategy is to improve the productivity of our existing businesses. There are multiple initiatives focused on driving comps in our legacy stores and improving the core business during the second quarter. Initiatives that will have the biggest impact on our comp sales through the remainder of the year will be the relaunch of our MyAcademy Rewards program which is being integrated into our loyalty ecosystem. The newly integrated program features a three-tiered structure. The base tier is MyAcademy Rewards and does not require a credit card to access savings. The key element of the value proposition at this level include both a $15 off welcome offer and birthday reward, a $25 off reward and a $500 spend threshold, and free shipping on all .com orders over $25. The middle tier of MyAcademy Rewards requires an Academy private label credit card, which gives you access to 5% off your purchases at Academy. It's important to note that the customer gets these savings instantaneously at point of sale versus having to wait for an award certificate that they can redeem against future purchases, which is the case with most of the competitive offers in the marketplace. This tier also qualifies for free shipping on all .com purchases with no minimum purchase requirement. The top tier is unlocked by our new co-branded MyAcademy Rewards MasterCard, which we call the official card of fun. Customers in this tier get all the benefits from the other tiers while also getting a higher credit limit, coupled with a best-in-market 2% back on all spend outside of Academy in the form of rewards that can only be redeemed at Academy. We're in the process of releasing new cards to all of our current cardholders and plan to be complete by the end of June. We're already seeing an uplift in sales from this initiative, driven by increased enrollment and card utilization. We believe customers are leveraging our best-in-market value proposition as a way to offset the rising costs they're dealing with in their everyday lives. Enrollment in MyAcademy Rewards is up double digits here over the year, with our goal being to add an additional 2 million new members this year, which will grow our total loyalty program to over 15 million members. As we shared before, summer is one of our prime selling seasons, and we're well positioned this year to help fuel the fun for our customers. Our end stocks continue to run up over 200 basis points versus last year, driven by our standard utilization of RFID. In addition, we have several non-comp tailwinds this year, including the World Cup being played in venues across our footprint, coupled with America's 250th birthday. We're well stocked in World Cup gear, summer essentials, and all things red, white, and blue, so we can maximize the opportunities ahead of us in the second quarter. Shifting gears to our omnichannel business, we continue to make solid progress, which is evidenced by the 17% growth in sales and the 100 basis point expansion and penetration we experienced in Q1. We have two key focuses during second quarter. First, we're expanding our same-day delivery platforms. to include Uber Eats and Instacart as a complement to our existing partnership with DoorDash. Our research shows there is minimal overlap between the customer bases for each of these services, so expanding our online presence to include these additional same-day delivery platforms should be mostly accretive and expose our brand and product categories to a broader audience. In addition, we plan to migrate the search platform from our site to be powered by Google's AI Commerce Search and Gemini Enterprise Customer Experience as we turn the corner into back to school. We believe customers are increasingly utilizing AI agents to aid them as they shop online. So moving our search to be powered by AI is a natural evolution and will be intuitive for them. As we continuously evolve our online capabilities, we expect the sales momentum we've built over the past year in this business will continue to provide a strong comp tailwind to our overall sales. In summary, Our belief is high gas prices and other inflationary pressures will persist and continue to negatively impact discretionary spending for the American consumer throughout the remainder of the year. In the face of this pressure, we are committed to remaining a steward of value for our customers while we methodically execute against our long-range plans and objectives. As our strategies mature and we build critical mass across each of them, We believe this will provide a strong tailwind, which will allow us to sustain the positive momentum we built in the first quarter. Based on the solid starts of the year, we're raising our annual sales guidance to be plus 3% to plus 5%, which would translate into a flat to plus 2% comp sales increase for fiscal 2026. Now I'll turn it over to Carl, who will give you a deeper dive into the Q1 financial results, along with the additional information on our updated 2026 guidance.