Dick's Sporting Goods (DKS:US), an American chain of sporting goods stores, reported much weaker-than-expected results for its second quarter. The underperformance prompted the retailer to slash its full-year outlook, ultimately sending its shares sharply lower on Tuesday.

The adjusted earnings per share came in at $2.82 for the quarter, well below the average analyst estimate of $3.81. Dick's recorded net sales of $3.22 billion for the quarter, slightly below the estimated $3.24 billion.

The gross margin was 34.4%, lower than the estimated 36.3%, while inventory decreased by 5% during the period. Comparable sales rose by 1.8%, while analysts were looking for growth of 2.6%.

Dick's Sporting reaffirmed its 2023 comparable store sales outlook, which is anticipated to range from flat to positive 2.0%. However, the company slashed its full-year EPS forecast to reflect second-quarter results and gross margin expectations for the second half of the year. Full-year EPS is now seen in the range of $11.50 to $12.30.

“We are pleased with our strong sales performance for the second quarter led by robust transaction growth and continued market share gains,” said Lauren Hobart, President and Chief Executive Officer.

“While we posted another double-digit EBT margin, our Q2 profitability was short of our expectations due in large part to the impact of elevated inventory shrink, an increasingly serious issue impacting many retailers. Despite moderating our 2023 EPS outlook, the enthusiasm we have for our business and the confidence we have in our long-term growth opportunities have never been stronger.”

Dick’s shares fell as much as 25% on Tuesday. Representative Ro Khanna disclosed in July he was trading the stock, which is up 22% year-to-date, a month earlier.