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Foot Locker’s stock plunged by nearly a third after the sneaker retailer reported dismal earnings in the second quarter that it blamed on “ongoing consumer softness.”

In the latest quarter, Foot Locker’s sales fell 9.9% to $1.8 billion — a sharp drop from the $2.1 billion a year earlier, the company said in its earnings report Wednesday

Foot Locker’s share price tumbled 28% to close at $16.64.

The New York-based retailer, which has nearly 900 outposts across the US, slashed its yearly forecast due to “the still-tough consumer backdrop,” and now expects sales to decline 8% to 9% for the year. It originally predicted sales would be down 6.5% to 8%.

“We did see a softening in trends in July and are adjusting our 2023 outlook to allow us to best compete for price-sensitive consumer,” Foot Locker chief Mary Dillon said in a statement.

The footwear chain slashed its yearly earnings outlook to between $2 and $2.25 per share — down from the $3.35 to $3.65 a share it originally predicted and well below the $3.47 analysts were expecting.

A day earlier, Macy’s shares dropped after it posted declining sales in its second-quarter earnings, which it attributed to declining consumer spending and increased credit card delinquencies

Macy’s net sales fell to $5.1 billion in the 13-week period ended July 29 — down from the $5.6 billion reported in the same period last year.

In-store sales at Macy’s 500-plus locations also dropped 8% and digital sales declined 10% compared with the year-ago period, sending Macy’s share price tumbling over 14%, to $12.57 on Tuesday.

Macy’s said there were particular challenges in the active, casual and sleepwear categories, while beauty products and fragrances performed better.

In addition, other revenues — such as earnings from credit interest and other non-operating revenues — decreased $84 million from the prior year period, to $150 million.

The New York City-based department store chain attributed the losses to “credit card revenues which were negatively impacted by an increased rate of delinquencies.”

Customers paying their credit card bills on time is viewed as a proxy for consumer health, and an increased number of defaulted payments is an indicator that consumers will have to prioritize bills over shopping.

“In light of ongoing macroeconomic pressures and uncertainty on when those will abate, the company continues to take a cautious approach on the consumer,” Macy’s earnings report said.

The department store’s chairman and chief executive, Jeff Gennette, reaffirmed the retailer’s cautious outlook on consumer spending in an earnings call with investors on Tuesday, “especially at Macy’s where roughly 50% of the identified customers have an average household income of $75,000 or under,” he said.

“We have seen the Macy’s customer more aggressively pull back on spend in our discretionary categories. They are not converting as easily and becoming more intentional on the allocation of their disposable income with an ongoing shift to services and experiences,” he added.

Macy’s has been underperforming in the stock market this year. Its stock has fallen more than 37% year to date.

In yet another example of softening consumer spend, Target said its quarterly sales fell for the first time in six years.

Sales at stores and digital channels open for at least a year were off 5.4% from a year earlier, according to Targets earnings report released last week, while digital sales slipped 10.5%.

Though Target’s longtime CEO Brian Cornell attributed part of the losses to “the impact of inflation,” CFO Michael Fiddelke added that boycotts of the retailer’s controversial “Pride” collection also contributed to the quarter’s results.

Dick’s Sporting Goods also missed analyst forecasts for the second quarter, reporting a 23% drop in profits across its more than 700 stores nationwide — despite sales rising 3.6%. 

Dicks attributed the losses to organized retail crime and our ability to effectively manage inventory shrink, an industry term used to describe stolen or lost merchandise.

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Will Labour get better marks on education next term?

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Will Labour get better marks on education next term?

👉Listen to Politics at Sam and Anne’s on your podcast app👈       

“Education, education, education” was how Tony Blair set out New Labour’s priorities in the early noughties.

A quarter of a century on, what story is Sir Keir Starmer trying to tell about schools under his premiership?

In this episode, Sam and Anne are joined by Laura McInerney, a former teacher and co-founder of Teacher Tapp, to break down the government’s plan for education as we head into a new school year.

They ask:

• What will be included in the education white paper?
• Can there be further devolution within the education system?
• Will Bridget Phillipson remain as education secretary?

Sam and Anne are getting a lie-in over summer recess, but they’ll be in your feed with special episodes every Monday before normal services resumes on 1 September.

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World

Leaders have worked hard to get on the right side of ‘unpredictable’ Trump – precisely for moments like today

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Leaders have worked hard to get on the right side of 'unpredictable' Trump - precisely for moments like today

Truly, this is a moment as important as it is unusual. History does not provide us a guide here.

Never before have we seen so many world leaders gather at such short notice for a meeting like this at the White House, and with a president as consequential as he is unpredictable.

The speed with which it has been organised is remarkable. A diplomatic source has framed the hasty gathering as “organic”; the obvious next step after the Alaska summit, the source said.

Donald Trump at the summit in Alaska. Pic: Reuters/ Kevin Lamarque
Image:
Donald Trump at the summit in Alaska. Pic: Reuters/ Kevin Lamarque

The Europeans were not in the room for that. Today, they will dominate the room.

Is there a risk Donald Trump will feel encircled? I don’t think so. More likely, he will enjoy the moment, seeing himself as the great convener. And on that, he’d be right.

Whether his diplomatic process has been cack-handed or smart – and the debate there will rage on – there is no question he has created this moment of dialogue.

It was the unfolding, or unravelling, of another White House moment, back in February, which gives some key context for the day ahead.

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What happened last time Zelenskyy went to the White House?

That Trump-Zelenskyy Oval Office meltdown was a reality check for European leaders.

We all watched Trump and his vice-president, JD Vance, slam the Ukrainian leader. It was excruciating but it was also instructive because, beyond the shouting, positions and attitudes were made clear.

That February meeting provided everyone with a crystallising sense of precisely who they were dealing with.

Since then, Europe and its key leaders have moulded and shifted their positions. Collectively they have transformed their own defence spending – recognising the necessity to stand on their own. And individually they have sought, urgently, to forge their own relationships with the US president.

Watch Sky News for continuous coverage from 5pm

Trump and NATO secretary general Mark Rutte in the White House in July. Pic: Reuters
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Trump and NATO secretary general Mark Rutte in the White House in July. Pic: Reuters

Each of the leaders here today has worked hard (cringingly so, some might say) to get on the right side of Trump.

Whether it be Starmer and his state visit, Stubb and his golfing skills, Meloni and her Trump-aligned politics, or Rutte and his “daddy” comments, they have all appealed in different ways to Trump. They have done so precisely for moments like today.

In the hours ahead, we can expect Trump and Zelenskyy to meet with their respective delegations. We will probably see them together in the Oval Office. Brace for no repeat of February; Zelensky knows he played that badly.

Analysis and explainers:
How a chaotic 24 hours unfolded ahead of talks
Why Zelenskyy is taking a posse of leaders for talks

Trump and Starmer met at the US president's Turnberry golf course in Scotland in July. Pic: Reuters/ Evelyn Hockstein
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Trump and Starmer met at the US president’s Turnberry golf course in Scotland in July. Pic: Reuters/ Evelyn Hockstein

A repeat is unlikely not least because, in a typically Trumpian way, the American president appears to be agreeing now to the very thing he chastised Zelenskyy for requesting back in February – security guarantees before the war stops.

There will be plenty to look out for in the day ahead.

With Trump, the trivial matters as much as the detail, and very often the trivial can impact the detail. So will Zelenskyy wear a suit and tie, or at least a jacket? Remember the furore over his decision to stick to his war-time combat gear in February.

After that bilateral meeting, the wider meeting is expected. The central aim of this from a European perspective will be to understand what Trump is prepared to do in terms of guaranteeing Ukrainian security, and crucially what he and Putin discussed and agreed.

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Trump and Putin in Alaska – The Debrief

Is Putin really willing to accept some sort of American-European security pact for Ukraine? That sounds like NATO without the membership, so would that really fly with the Russian president?

Beyond that – what precisely did Trump and Putin discuss in terms of territorial swaps (more accurately described as control swaps because Ukraine would be negotiating away its own land)?

There is a concern that intentional ambiguity might allow for a peace deal. The different sides will interpret the terms differently. That could be fine short-term, providing Trump with a quick fix, but longer term it could be unsustainable and dangerous.

So above all, the European leaders’ tone to Trump will be one of flattery framed by a gentle warning.

They’ll tell him that he created this moment for peace; that it is his peace and that they want to work with him to keep it (and thus cement his legacy).

But to do that, they will tell him, they need his continued commitment to them; to Europe, not capitulation to Russia.

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World

‘Not in our name’: Israelis protest against Gaza war – but Netanyahu seems unmoved

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'Not in our name': Israelis protest against Gaza war - but Netanyahu seems unmoved

The coordinates came through last minute. The instruction was to get there fast.

People organising demonstrations, blocking motorways and major intersections, did not want police getting wind of their plans.

The one we found ourselves at, near the town of Lod, halfway between Tel Aviv and Jerusalem, felt a bit like a flash-mob protest, done and dusted in less than half an hour.

Protesters set fire to tyres which blazed across a motorway
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Protesters set fire to tyres which blazed across a motorway


The protestors had set fire to tyres, which blazed across the motorway, filling the sky with thick black smoke.

They waved the Israeli flag and other yellow flags to show solidarity with the remaining hostages still in Gaza, whose photos they carried – their faces and names seared on the collective consciousness now – a collective trauma.

“We want the war to end, we want our hostages back, we want our soldiers back safe home, and we want the humanitarian disaster in Gaza to end”, one of the protestors told me.

“We do not want to have these crimes made in our name.”

And then she was gone, off to the next location as the group vanished in a matter of minutes, leaving police to put out the fire.

Demonstrators block a street during a protest demanding the immediate release of hostages held by Hamas and calling for the Israeli government to reverse its decision to take over Gaza City and other areas in the Gaza Strip, in Jerusalem, Sunday, Aug
Image:
Demonstrators block a street during a protest demanding the immediate release of hostages held by Hamas and calling for the Israeli government to reverse its decision to take over Gaza City and other areas in the Gaza Strip, in Jerusalem, Sunday, Aug

Protesters in Tel Aviv. Pic: Reuters
Image:
Protesters in Tel Aviv. Pic: Reuters

This was a day of stoppage, a nationwide strike – a change of tactics by the hostage families to up the ante with the government in their calls to stop the war, make a deal and bring the hostages home.

Benjamin Netanyahu was unmoved.

“Those who are calling for an end to the war today without defeating Hamas are not only hardening Hamas’s stance and delaying the release of our hostages, they are also ensuring that the horrors of October 7 will recur again and again”, he said at the start of the weekly cabinet meeting.

Netanyahu ‘broke contract’ with us

Ahead of the day of strike action, we spoke to a former Air Force reservist who quit in April in protest over Netanyahu’s decision to break the ceasefire.

“I felt he hadn’t broken the contract with Hamas, he’d broken the contract with us – with the people, releasing the hostages, stopping the war. That was my breaking point.”

He wanted to be anonymous, identifying himself by the call sign ‘F’.

'F' called the current conflict 'forever war'
Image:
‘F’ called the current conflict ‘forever war’

He had done three tours since the war began, mostly spent with eyes on Gaza – coordinating air strikes to support ground operations and ensuring the Air Force gets the target right.

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Israeli air force reservist refuses call-up

‘This is eternal war’

“It’s very complicated, very demanding and very hectic. The main problem is to see that you follow the rules and there are lots of rules – safety rules, international law rules, military doctrine rules.

“And to see that there are no mistakes because you can check all the rules, you can make everything perfect, if there’s a mistake, it bypasses everything you did and the bomb would fall on someone you didn’t want it to fall on.”

I ask him how he feels about the huge death toll in Gaza.

“Look, the uninvolved death toll is tough. It’s tough personally, it’s tough emotionally, it’s tough professionally. It shouldn’t happen.

“When you conduct a war at this scale, it will happen. It will happen because of mistakes, because of the chaos of war.”

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Israel must have ‘security control’ to end Gaza war

He is softly spoken, considered and thoughtful, but says he’s prepared to take part in the more radical protest actions, such as blocking motorways and starting fires, to try and get the message through.

Read more on Sky News:
‘More than 100 killed in a day’
Gaza’s hospitals ‘overwhelmed’
Madonna urges papal intervention

“Hamas is probably the weakest enemy we have had since 1948,” he says.

“In ’48, in the liberation of Israel, we fought seven armies, much better equipped, better ordered than us, and the war took less time.

“We stopped the war with Iran after 12 days. They are much more dangerous than Hamas. We stopped a war with Hezbollah in a couple of months, and they are still a much bigger threat than Hamas.

“You cannot eliminate a terror organisation to the last person. From my point of view, this way – this is eternal war.”

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