Dick’s Sporting Goods Expands House of Sport Stores

As many retailers look for ways to reduce store counts and square footage, Dick’s Sporting Goods goes bigger.

The retailer is building more sprawling “House of Sport” stores, which typically span 120,000 to 150,000 square feet, more than double the 50,000 at its traditional locations. The sporting goods company thinks it’s working.

“We had to build the concept that would kill Dick’s Sporting Goods,” Edward Stack, executive chairman and son of founder Dick Stack, told CNBC in an exclusive interview at Dick’s House of Sport store in Pittsburgh. “We have to build the concept that if someone else built this store across the street from us, we would go out of business, and that’s exactly what we did.”

As shoppers prioritize experiences and choices, locations allow Dick’s to meet them where they are. Most House of Sport stores have two-story climbing walls; sports cages for testing bats; field hockey and lacrosse sticks with statistical feedback; outdoor areas which also serve as ice rinks in winter; and golf simulators.

Beyond the experiences, House of Sport has three times the square footage devoted to shoes than a traditional store, plus 400 types of cleats in the House of Cleats section and other brands and merchandise exclusive to the concept.

“[House of Sport] has been hugely successful,” Stack said. A typical House of Sport store does about $35 million in annual sales across all channels with earnings before interest, taxes, depreciation and amortization of about 20 percent, “so they are extremely, extremely productive.” Dick’s Sporting Goods does not report EBITDA for the entire company, although it reported pre-tax earnings of 14% during its last quarter.

Before the first House of Sport location opened, Stack said Wall Street believed the retailer should close stores and reduce its footprint.

“Their concept was, ‘I don’t really know how many stores you have, but you have too many,’ or ‘I don’t really know how big your store is, but it’s too big, you need to shrink it,'” Stack said. “When I told them, ‘Hey, our philosophy is that in 10 years we’ll probably have the same number of stores, we’ll have a lot more square footage, that hasn’t gone very well, you know, and our inventory is kind of at a standstill because of that.'”

But Stack was not deterred.

The retailer’s first “House of Sport” store opened in 2021, and the newest location in Jersey City, New Jersey, just outside of New York City, debuted this month. Dick’s plans to have 35 by the end of the year and up to 100 by the end of its 2027 fiscal year, in addition to its more than 850 stores under the Dick’s, Golf Galaxy, Field & Stream, Public Lands and Warehouse Sale banners.

The concept carries a risk. Navdeep Gupta, chief financial officer of Dick’s Sporting Goods, said on earnings calls that it takes about $11.5 million in net capital expenditures to open a House of Sport store, a significant expense for a brick-and-mortar retailer at a time when more and more sales are moving online.

Additionally, most of House of Sport’s locations are in shopping malls, which face footfall challenges. Recent examples show that even compelling experiential retail doesn’t always translate into financial success and can be difficult to scale. These include a post-bankruptcy reinvented Toys R Us, Saks Fifth Avenue and Barneys. Nike has had mixed success with its big flagship experiential concepts.

The additional shelf space at House of Sport stores allows Dick’s to showcase more of its partner brands, both old and new. Nike, among other companies, was impressed by the concept, Stack said.

“The Nike leadership team came in and saw [House of Sport]and they looked around and said, ‘This is absolutely the best expression of sport in the world,'” he said.

As Nike works to rebuild other wholesale partnerships under new CEO Elliott Hill, Stack said “our relationship with Nike is great.” In fact, House of Sport offers Air Jordan and Kobe products produced by Nike that are not available elsewhere.

Stack said the interconnection between in-store product experience and testing leads to merchandise sales. “This visit is not just about this visit, but also about the fact that they continue to come back,” although he declined to share further figures.

A key business strategy for House of Sport is also to feature newer, smaller, more premium brands like Varley, Johnnie-O, Faherty, Marine Layer and others. There is also a co-lab space, where the brands change approximately every 6 weeks. Currently, UK-based GymShark is using this rotation to test retail in the United States.

While Dick’s goal isn’t necessarily to also sell House of Sport’s proven brands in brick-and-mortar stores, doing so could open up an opportunity – or vice versa.

He pointed to On’s brand management, which began in the Dick’s Public Lands store format, when “to be honest with you, they were just testing us to see what it meant to do business with us,” Stack said. He added that four years later, On is now in around 450 Dick’s stores and is one of House of Sport’s “flagship brands”.

It’s not just brands that are interested in House of Sport. The concept also helps mall owners fill huge empty spaces that once housed department stores.

“Shopping center developers love that we’re doing this now that they understand what we’re doing, because usually in the Sears wing, or a wing that has a department store that’s been vacant for a while, that wing of the mall is usually not very well leased for developers,” Stack said. Most House of Sport stores are located where Sears, Lord & Taylor or Nordstrom used to be, in Class A or B shopping centers.

Megastores aren’t the only risk Dick’s has taken to irritate Wall Street. Investors are not yet sold on the retailer’s $2.4 billion acquisition of Foot Locker.

“A lot of people, when we first made this acquisition, didn’t like it,” Stack said. “Our stock was hammered and we knew they wouldn’t like it.”

The deal was announced in May and closed on September 8, bringing the total number of Dick’s Sporting Goods stores across all brands to approximately 3,200 in 20 countries.

While Stack leads Foot Locker’s integration, Ann Freeman, formerly with Nike, is Foot Locker’s new president of North America. And as Dick’s expands its department store segment, shoes will become a staple.

“Shoes are the engine that pulls the train, and between [House of Sport footwear selection] and Foot Locker… it’s going to end up being a really good lifetime investment,” Stack said.

Stack is invested in the future of the company. He remains the largest individual shareholder, holding 13.3% of the outstanding shares and 47% of the voting rights, according to the latest proxy from April 2025.

But even with investor disappointment over the Foot Locker deal, Dick’s stock has outperformed the athletic brands it sells or competes with. Although the average analyst rating is Overweight, the average target price is $241, just 6% above its current price.

Lululemon lost more than half of its market capitalization this year, Under Armor is down 42% since the start of the year, We lost 22% and Nike is down 9% in 2025.

Much of Dick’s Sporting Goods’ business centers around youth sports. This is a $40 billion annual market according to the Aspen Institute, with spending per child on a primary sport averaging $1,016 in 2024, up 46% in 2024 from 2019.

Stack often says his company is more insulated from macroeconomic pressures because of its clientele of young athletes, because parents don’t often put a growing child’s feet in last year’s cleats. The replacement cycle likely contributed to 12 consecutive quarters of comparable sales growth for the retailer and the highest sales in the company’s history.

But product and sports innovation have also boosted sales in Dick’s sporting goods business. Self-expression in baseball, for example, has recently increased demand for the colorful baseball mitts, baseball bats and $105 batting gloves that are among House of Sport’s best-selling products.

Stack said “innovation costs more” and “as parents dress their kids, they want to give their kids the best chance to succeed and perform well.”

Stack, who oversaw the massive expansion of Dick’s, also credits “the best management team we’ve ever had” and said “we never fall in love with ourselves…we’re happy with something we got right for about 15 minutes, and then we talk about it, how can we make this better?”

Going big has been Stack’s modus operandi since he took over the two-location retailer his father founded in 1948 and built it into the $20 billion market cap company it is today. Risk-taking, from new concepts to acquisitions, is also at the heart of the DNA of the retailer Stack has built.

“In a meeting, everything starts with ‘Yes, if…’ and can never start with ‘No, because…’ and that has made a huge difference in our business,” he said.