Dick’s Sporting Goods reported record earnings for its fiscal 2021 fourth quarter ended Jan. 29, 2022, as well as for fiscal year 2021.

The retailer reported last week Q4 sales reached $3.35 billion up 7.3% from the year-ago period. This was the largest sales quarter in the company’s history. It also reported $12.29 billion in net sales for the fiscal year, up 28.3% year over year.

CEO Lauren Hobart says its record earnings result from its investments, including its omnichannel technology.

“We invested in technology, data science and our omnichannel platform, and significantly improved our digital marketing and personalization capabilities,” Hobart told investors, according to a SeekingAlpha transcript. “These transformational changes were driving improved results well before the pandemic and further accelerated our performance over the past two years.”

Dick’s will continue to invest in technology to enhance its store fulfillment and in-store pickup capabilities, she said. This will drive profitability for its ecommerce business, she added. In Q4, stores enabled more than 90% of total sales. They fulfilled about 70% of online client sales through ship from store, in-store pickup or curbside, Hobart said.

Ecommerce approach

Ecommerce sales decreased 11% year over year in its fiscal Q4. However, compared with Q4 2019, ecommerce sales were still up 39%.

Navdeep Gupta, chief financial officer, said the decrease in ecommerce sales was because of a “deliberate decision to minimize site-wide promotion to better manage” inventory throughout the quarter.

As a portion of total revenue, online sales reached 27% in Q4 2021. That’s down from 32% in Q4 2020 but up from 25% penetration in Q4 2019. Dick’s Sporting Goods is No. 29 in the 2021 Digital Commerce 360 Top 1000.

But the retailer will stop providing ecommerce sales growth and penetration metrics beginning Q1 FY 2022, Gupta said.

“Our athletes are increasingly shopping across multiple channels on the same transaction, and it no longer makes sense to try and attribute a sale to a specific channel,” Gupta said. “And with EBT [earnings before tax] margins being similar regardless of an online versus in-person transaction, the difference is even less relevant from a modeling perspective.”

While COVID-19 caused surges in certain categories, such as fitness and bikes, Hobart says the retailer’s sales increased in almost every category since 2019. She says the company expects ecommerce to continue to grow.

“Every single category has rebaselined significantly higher,” Hobart said. “We saw, in 2021, incredible strength in our — what I would say is our core business, so team sports athletic apparel, athletic footwear and golf.”

However, the retailer’s record sales spiked when the supply chain became increasingly challenging to navigate. She said supply chain challenges have led to products already in inventory selling fast.

Gupta declined to comment on the call about the impact the supply chain will have on higher oil prices. The company used market prices at the beginning of the year for budgeting expectations, he said.

“When we created our budget, the geopolitical situations were not what they are right now,” Gupta said, referring to the Russia-Ukraine conflict. “So we’ll continue to watch how these situations evolve.”

For its fiscal fourth quarter ended Jan. 29, 2022, Dick’s Sporting Goods reported:

• Total revenue of $3.35 billion, up 7.3% compared with the previous fiscal year’s fourth-quarter revenue of $3.15 billion, and up 28.5% from FY 2019’s fourth quarter.
• A nearly 6% same-store sales increase, which was on top of a 19.3% increase in the same period last fiscal year, and a 5.3% increase from Q4 FY 2019.
• An 11% decrease in ecommerce sales.
• Ecommerce penetration fell to 27% of total net sales, down from 32% in the previous fiscal year’s fourth quarter, and up slightly from 25% in fiscal year 2019.

For the fiscal year ended Jan. 29, 2022, Dick’s Sporting Goods reported:

• Total revenue of $12.29 billion, up 28.3% up from $8.81 billion with the previous fiscal year.
• A 26.5% same-store sales increase, on top of a 9.9% increase from FY 2020 and a 3.7% increase in 2019.
• A 9% decrease in ecommerce sales.
• Ecommerce penetration grew to 21% of total net sales, up from 16% of total net sales the previous fiscal year.

Percentage changes may not align exactly with dollar figures due to rounding.