Foot Locker (FL) shares plunged 5.06% in intraday trading, as investors reacted to the company's disappointing second-quarter earnings report and contemplated the impending merger with Dick's Sporting Goods. The significant drop comes at a crucial time for the sneaker retailer, with its acquisition by Dick's Sporting Goods set to close on September 8.

The company's second-quarter earnings fell short of analysts' expectations, with comparable sales declining 2% worldwide. This underwhelming performance likely contributed to the stock's sharp decline. However, there were some positive signals in North America, where comparable sales increased by 1.4%, led by positive performance across Foot Locker, Kids Foot Locker, and Champs Sports banners.

Meanwhile, Dick's Sporting Goods, which agreed to acquire Foot Locker for $24 per share in May, reported better-than-expected quarterly earnings. Dick's posted adjusted earnings of $4.38 per share, surpassing analysts' forecasts of $4.30. The contrast between the two companies' performances may be fueling investor concerns about the upcoming merger. As the September 8 closing date approaches, market participants appear to be reassessing the deal's potential impact on both companies.