FY24 PBT guidance cut to £915m-£935m (guidance at 1H results was in-line with market expectation of £1.04m). Taking the mid-point, this is 11% below company-compiled FY24 PBT consensus of £1,043m. Both sales growth & gross margin have come in below expectations. Apparel revenue growth was impacted by milder weather, while peak trading was softer and more promotional than management expected, reflecting a weaker product cycle and more cautious consumer spending. The shift in mix to lower gross margin footwear and a more promotional environment means FY gross margin is expected to be down YoY (previously up). Also, £15m of the downgrade is non-trading with a £7m impact from reclassification of capex to opex (IAS38 software) and £8m lower interest income following the ISRG NCI acquisition. Sales slowed materially on 1st 7 weeks (10% organic growth) with constant currency organic revenue growth up 6% (LFL +1.8%) over the 22 weeks to 30th December. No breakdown has been given by region but we suspect the biggest profit impact will have been from the UK (highest apparel mix/2H sales likely to be negative/higher relative cost growth with minimum wage) and the US (Peers/Nike talked about more volatile 2H sales/consumer weakness as well as the US market generally being a more promotional market). FY24E/FY25E PBT cut by 12%/14%, reflecting new FY24 guidance and more cautious FY25E growth assumptions. Initial management guidance for FY25 is expected to be given in March. Whilst a downgrade is disappointing short term, JD has a strong proposition, is executing well against its 5 year plan (over 200 stores to be opened in FY24) and we believe has a material long term growth opportunity. Reduced TP of 235p (prev 300p) reflects downgrade.