Designer Brands Inc. Reports First Quarter 2026 Financial Results
Strong momentum continued with first quarter net sales growth meeting and adjusted diluted earnings per share ("EPS") exceeding expectations
Gross margin expansion of 240 basis points
Anticipates full year 2026 EPS trending toward the high end of guidance range
COLUMBUS, Ohio, June 9, 2026 /PRNewswire/ -- Designer Brands Inc. (NYSE: DBI) (the "Company," "we," "us," "our," and "Designer Brands"), one of the world's largest designers, producers, and retailers of footwear and accessories, today announced financial results for the first quarter ended May 2, 2026.
"Our strong start to the year was underscored by double-digit sales growth in our Brand Portfolio segment and encouraging stabilization in our Retail segment," said Doug Howe, Chief Executive Officer. "In addition to top-line strength, we delivered meaningful profitability gains, with gross margin expanding 240 basis points, reflecting the structural improvements we have made across inventory management, pricing discipline, sourcing, and channel profitability."
Howe continued, "Following our encouraging start to the year, we believe in our ability to achieve the high end of our fiscal 2026 EPS guidance range, even amidst ongoing uncertainty in the macroeconomic environment. We believe our strategic actions will continue to strengthen our foundation of the business and position us well for long-term profitable growth."
First Quarter Operating Results (Unless otherwise stated, all comparisons are to the first quarter of 2025)
Liquidity
Store Count
(square footage in thousands)
May 2, 2026
May 3, 2025
Number of
Stores
Square
Footage
Number of
Stores
Square
Footage
DSW stores
518
10,150
520
10,237
The Shoe Co. stores
118
599
121
620
Rubino stores
27
140
28
149
Total number of stores
663
10,889
669
11,006
2026 Financial Outlook
The Company is reaffirming the following guidance for the full year 2026:
Metric
2026 Guidance
Designer Brands Change in Net Sales
Down 1% to Up 1%
Diluted Earnings per Share
$0.28 - $0.38
Webcast and Conference Call
The Company is hosting a conference call today at 8:30 am Eastern Time. Investors and analysts interested in participating in the call are invited to dial 1-888-317-6003, or the international dial-in, 1-412-317-6061, and reference conference ID number 6930887 approximately ten minutes prior to the start of the conference call. The conference call will also be broadcast live over the internet and can be accessed through the following link, as well as through the Company's investor website at investors.designerbrands.com:
https://app.webinar.net/704rZBvZkGJ
For those unable to listen to the live webcast, an archived version will be available on the Company's investor website until June 23, 2026. A replay of the teleconference will be available by dialing the following numbers:
North America: 1-855-669-9658
International: 1-412-317-0088
Passcode: 7496602
Important information may be disseminated initially or exclusively via the Company's investor website; investors should consult the website to access this information.
About Designer Brands
Designer Brands is one of the world's largest designers, producers, and retailers of the most recognizable footwear brands and accessories, transforming and defining the footwear industry through a mission of being shoe obsessed. With a diversified, world-class portfolio of coveted brands, including Topo Athletic, Keds, Vince Camuto, Kelly & Katie, Jessica Simpson, Lucky Brand, Mix No. 6, Crown Vintage and others, Designer Brands designs and produces on-trend footwear and accessories for all of life's occasions delivered to the consumer through a robust direct-to-consumer omni-channel infrastructure and powerful national wholesale distribution. Powered by a billion-dollar digital commerce business across multiple domains and over 660 DSW Designer Shoe Warehouse, The Shoe Co., and Rubino stores in North America, Designer Brands delivers current, in-line footwear and accessories from the largest national brands in the industry and holds leading market share positions in key product categories across women's, men's, and kids'. Designer Brands also distributes its brands internationally through select wholesale and distributor relationships while also leveraging design and sourcing expertise to build private label products for national retailers. Designer Brands is committed to being a difference maker in the world and the footwear industry. By leading with our corporate values of We Belong and We Do What's Right, Designer Brands supports the global community and the health of the planet by donating more than thirteen million pairs of shoes to the global non-profit Soles4Souls since 2018. To learn more, visit www.designerbrands.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Certain statements in this press release may constitute forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by the use of forward-looking words such as "outlook," "could," "believes," "expects," "potential," "continues," "may," "will," "should," "would," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of those words or other comparable words. These statements are based on the Company's current views and expectations and involve known and unknown risks, uncertainties, and other factors, many of which are outside of the Company's control, that may cause actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. These factors include, but are not limited to: uncertain general economic and financial conditions, including economic volatility and potential downturn or recession, supply chain disruptions, new or increased tariffs and other barriers to trade, tariff refunds, fluctuating interest rates, unemployment rates and inflationary pressures, and the related impacts to consumer discretionary spending, as well as our ability to plan for and respond to the impact of these conditions; our ability to anticipate and respond to rapidly changing consumer preferences, seasonality, customer expectations, and fashion trends; the impact on our consumer traffic and demand, our business operations, and the operations of our suppliers, as we experience unseasonable weather, climate change evolves, and the frequency and severity of weather events increases; our ability to execute our business strategies, including growing our Brand Portfolio segment, enhancing in-store and digital shopping experiences, integrating previously acquired businesses and brands, and meeting consumer demands; our ability to maintain strong relationships with our suppliers, vendors, licensors, and retailer customers; risks related to losses or disruptions associated with our distribution systems, including our distribution centers and stores, and payment processing services whether as a result of reliance on third-party providers or otherwise; our reliance on third parties to provide customer payment processing services; risks related to cyber security threats and privacy or data security breaches or the potential loss or disruption of our information technology ("IT") systems, or those of our vendors; risks related to the implementation of new or updated IT systems, including the use of artificial intelligence tools; our ability to protect our reputation and to maintain the brands we license; our reliance on our reward programs and marketing to drive traffic, sales, and customer loyalty; our ability to successfully integrate new hires or changes in leadership and retain our existing management team, and to continue to attract qualified new personnel; risks related to restrictions imposed by our senior secured asset-based revolving credit facility, as amended, and our senior secured term loan credit agreement, as amended, that could limit our ability to fund our operations; our competitiveness with respect to style, price, brand availability, shopping platforms, and customer service; risks related to our international operations and our reliance on foreign sources for merchandise; our ability to comply with laws and regulations, as well as other legal obligations; risks associated with climate change and other corporate responsibility issues; and uncertainties related to future legislation, regulatory reform, policy changes, or interpretive guidance on existing legislation. Risks and other factors that could cause our actual results to differ materially from our forward-looking statements are described in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2026 or our other reports made or filed with the Securities and Exchange Commission. All forward-looking statements speak only as of the time when made. Except as may be required by applicable law, the Company undertakes no obligation to update or revise the forward looking statements included in this press release to reflect any future events or circumstances.
DESIGNER BRANDS INC.
SEGMENT RESULTS
(unaudited)
Net Sales
Three months ended
(dollars in thousands)
May 2, 2026
May 3, 2025
Change
Amount
% of
Segment
Net Sales
Amount
% of
Segment
Net Sales
Amount
%
Segment net sales:
Retail
$ 626,684
84.5 %
$ 627,145
86.7 %
$ (461)
(0.1) %
Brand Portfolio
114,518
15.5
95,898
13.3
18,620
19.4 %
Total segment net sales
741,202
100.0 %
723,043
100.0 %
18,159
2.5 %
Elimination of intersegment net sales
(44,852)
(36,134)
(8,718)
24.1 %
Consolidated net sales
$ 696,350
$ 686,909
$ 9,441
1.4 %
Comparable Sales
Three months ended
May 2, 2026
May 3, 2025
Change in comparable sales:
Retail segment
(1.2) %
(7.5) %
Brand Portfolio segment - direct-to-consumer channel
3.0 %
(27.0) %
Total
(1.1) %
(7.8) %
Gross Profit
Three months ended
(dollars in thousands)
May 2, 2026
May 3, 2025
Change
Amount
% of
Segment
Net Sales
Amount
% of
Segment
Net Sales
Amount
%
Basis
Points
Segment gross profit:
Retail
$ 284,296
45.4 %
$ 268,200
42.8 %
$ 16,096
6.0 %
260
Brand Portfolio
38,877
33.9 %
26,026
27.1 %
12,851
49.4 %
680
Total segment gross profit
323,173
43.6 %
294,226
40.7 %
28,947
9.8 %
290
Net recognition (elimination) of
intersegment gross profit
(7,855)
255
(8,110)
Consolidated gross profit
$ 315,318
45.3 %
$ 294,481
42.9 %
$ 20,837
7.1 %
240
Intersegment Recognition and Elimination Activity
Three months ended
(in thousands)
May 2, 2026
May 3, 2025
Intersegment recognition and elimination activity:
Elimination of net sales recognized by Brand Portfolio segment
$ (44,852)
$ (36,134)
Cost of sales:
Elimination of cost of sales recognized by Brand Portfolio segment
28,003
25,814
Recognition of intersegment gross profit for inventory previously purchased
that was subsequently sold to external customers during the current period
8,994
10,575
$ (7,855)
$ 255
Operating Profit
Three months ended
(dollars in thousands)
May 2, 2026
May 3, 2025
Change
Amount
% of
Segment
Net Sales
Amount
% of
Segment
Net Sales
Amount
%
Basis
Points
Segment operating profit:
Retail
$ 51,278
8.2 %
$ 39,973
6.4 %
$ 11,305
28.3 %
180
Brand Portfolio
15,423
13.5 %
1,946
2.0 %
13,477
692.5 %
1,150
Total segment operating profit
66,701
9.0 %
41,919
5.8 %
24,782
59.1 %
320
Corporate/eliminations
(47,831)
(49,826)
1,995
(4.0) %
Consolidated operating profit
(loss)
$ 18,870
2.7 %
$ (7,907)
(1.2) %
$ 26,777
NM
NM
Immaterial Restatements of Prior Period Financial Results
During the first quarter of 2026, we identified that our previously acquired Topo business was utilizing incorrect duty rates applied to many of our Topo branded products imported into the U.S., both before and after the acquisition date. While the prior period amounts have been restated, as detailed below for comparability, the impact of the corrections in periods prior to the first quarter of 2026 are not material to the consolidated financial statements in any of the impacted periods. For additional information, refer to Notes 1 and 12 to our Form 10-Q for the period ended May 2, 2026.
(in thousands, except per share amounts, unaudited)
Three months ended May 3, 2025
Previously Reported
% of Net
Sales
Adjustments
As Adjusted
% of Net
Sales
Consolidated:
Net sales
$ 686,909
100.0 %
$ —
$ 686,909
100.0 %
Cost of sales
(391,783)
(57.0)
(645)
(392,428)
(57.1)
Gross profit
$ 295,126
43.0 %
$ (645)
$ 294,481
42.9 %
Operating loss
$ (7,262)
(1.1) %
$ (645)
$ (7,907)
(1.2) %
Net loss attributable to Designer Brands Inc.
$ (17,424)
$ (392)
$ (17,816)
Diluted loss per share
$ (0.36)
$ (0.01)
$ (0.37)
Brand Portfolio segment:
Net sales
$ 95,898
100.0 %
$ —
$ 95,898
100.0 %
Cost of sales
(69,227)
(72.2)
(645)
(69,872)
(72.9)
Gross profit
$ 26,671
27.8 %
$ (645)
$ 26,026
27.1 %
Operating profit
$ 2,591
2.7 %
$ (645)
$ 1,946
2.0 %
(in thousands, except per share
amounts, unaudited)
Three months ended August 2, 2025
Six months ended August 2, 2025
Previously
Reported
% of Net
Sales
Adjustments
As
Adjusted
% of Net
Sales
Previously
Reported
% of Net
Sales
Adjustments
As
Adjusted
% of Net
Sales
Consolidated:
Net sales
$ 739,762
100.0 %
$ —
$ 739,762
100.0 %
$ 1,426,671
100.0 %
$ —
$ 1,426,671
100.0 %
Cost of sales
(416,829)
(56.3)
(440)
(417,269)
(56.4)
(808,612)
(56.7)
(1,085)
(809,697)
(56.8)
Gross profit
$ 322,933
43.7 %
$ (440)
$ 322,493
43.6 %
$ 618,059
43.3 %
$ (1,085)
$ 616,974
43.2 %
Operating income
$ 26,583
3.6 %
$ (440)
$ 26,143
3.5 %
$ 19,321
1.4 %
$ (1,085)
$ 18,236
1.3 %
Net income (loss) attributable to Designer Brands Inc.
$ 10,827
$ (292)
$ 10,535
$ (6,597)
$ (684)
$ (7,281)
Diluted earnings (loss) per share
$ 0.22
$ (0.01)
$ 0.21
$ (0.14)
$ (0.01)
$ (0.15)
Brand Portfolio segment:
Net sales
$ 73,157
100.0 %
$ —
$ 73,157
100.0 %
$ 169,055
100.0 %
$ —
$ 169,055
100.0 %
Cost of sales
(54,649)
(74.7)
(440)
(55,089)
(75.3)
(123,876)
(73.3)
(1,085)
(124,961)
(73.9)
Gross profit
$ 18,508
25.3 %
$ (440)
$ 18,068
24.7 %
$ 45,179
26.7 %
$ (1,085)
$ 44,094
26.1 %
Operating loss
$ (3,606)
(4.9) %
$ (440)
$ (4,046)
(5.5) %
$ (1,015)
(0.6) %
$ (1,085)
$ (2,100)
(1.2) %
(in thousands, except per share
amounts, unaudited)
Three months ended November 1, 2025
Nine months ended November 1, 2025
Previously
Reported
% of Net
Sales
Adjustments
As
Adjusted
% of Net
Sales
Previously
Reported
% of Net
Sales
Adjustments
As
Adjusted
% of Net
Sales
Consolidated:
Net sales
$ 752,411
100.0 %
$ —
$ 752,411
100.0 %
$ 2,179,082
100.0 %
$ —
$ 2,179,082
100.0 %
Cost of sales
(412,792)
(54.9)
(359)
(413,151)
(54.9)
(1,221,404)
(56.1)
(1,444)
(1,222,848)
(56.1)
Gross profit
$ 339,619
45.1 %
$ (359)
$ 339,260
45.1 %
$ 957,678
43.9 %
$ (1,444)
$ 956,234
43.9 %
Operating income
$ 42,663
5.7 %
$ (359)
$ 42,304
5.6 %
$ 61,984
2.8 %
$ (1,444)
$ 60,540
2.8 %
Net income attributable to Designer Brands Inc.
$ 18,215
$ 991
$ 19,206
$ 11,618
$ 307
$ 11,925
Diluted earnings per share
$ 0.35
$ 0.02
$ 0.37
$ 0.23
$ 0.01
$ 0.24
Brand Portfolio segment:
Net sales
$ 101,923
100.0 %
$ —
$ 101,923
100.0 %
$ 270,978
100.0 %
$ —
$ 270,978
100.0 %
Cost of sales
(72,955)
(71.6)
(359)
(73,314)
(71.9)
(196,831)
(72.6)
(1,444)
(198,275)
(73.2)
Gross profit
$ 28,968
28.4 %
$ (359)
$ 28,609
28.1 %
$ 74,147
27.4 %
$ (1,444)
$ 72,703
26.8 %
Operating income
$ 8,256
8.1 %
$ (359)
$ 7,897
7.7 %
$ 7,241
2.7 %
$ (1,444)
$ 5,797
2.1 %
(in thousands, except per share
amounts, unaudited)
Three months ended January 31, 2026
Twelve months ended January 31, 2026
Previously
Reported
% of Net
Sales
Adjustments
As
Adjusted
% of Net
Sales
Previously
Reported
% of Net
Sales
Adjustments
As
Adjusted
% of Net
Sales
Consolidated:
Net sales
$ 713,589
100.0 %
$ —
$ 713,589
100.0 %
$ 2,892,671
100.0 %
$ —
$ 2,892,671
100.0 %
Cost of sales
(410,877)
(57.6)
(630)
(411,507)
(57.7)
(1,632,281)
(56.4)
(2,074)
(1,634,355)
(56.5)
Gross profit
$ 302,712
42.4 %
$ (630)
$ 302,082
42.3 %
$ 1,260,390
43.6 %
$ (2,074)
$ 1,258,316
43.5 %
Operating income (loss)
$ (14,220)
(2.0) %
$ (630)
$ (14,850)
(2.1) %
$ 47,764
1.7 %
$ (2,074)
$ 45,690
1.6 %
Net loss attributable to Designer Brands Inc.
$ (19,992)
$ 273
$ (19,719)
$ (8,374)
$ 580
$ (7,794)
Diluted loss per share
$ (0.40)
$ —
$ (0.40)
$ (0.17)
$ 0.01
$ (0.16)
Brand Portfolio segment:
Net sales
$ 91,883
100.0 %
$ —
$ 91,883
100.0 %
$ 362,861
100.0 %
$ —
$ 362,861
100.0 %
Cost of sales
(63,239)
(68.8)
(630)
(63,869)
(69.5)
(260,070)
(71.7)
(2,074)
(262,144)
(72.2)
Gross profit
$ 28,644
31.2 %
$ (630)
$ 28,014
30.5 %
$ 102,791
28.3 %
$ (2,074)
$ 100,717
27.8 %
Operating income
$ 3,667
4.0 %
$ (630)
$ 3,037
3.3 %
$ 10,908
3.0 %
$ (2,074)
$ 8,834
2.4 %
DESIGNER BRANDS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited and in thousands, except per share amounts)
Three months ended
May 2, 2026
May 3, 2025
Net sales
$ 696,350
$ 686,909
Cost of sales
(381,032)
(392,428)
Gross profit
315,318
294,481
Operating expenses
(299,209)
(301,862)
Income from equity investments
2,761
2,427
Impairment charges
—
(2,953)
Operating profit (loss)
18,870
(7,907)
Interest expense, net
(10,125)
(11,971)
Non-operating income (expenses), net
(5)
8
Income (loss) before income taxes and loss from equity investment
8,740
(19,870)
Income tax benefit (provision)
(4,805)
2,189
Loss from equity investment
(481)
—
Net income (loss)
3,454
(17,681)
Net income attributable to redeemable noncontrolling interest
(2,295)
(135)
Net income (loss) attributable to Designer Brands Inc.
$ 1,159
$ (17,816)
Diluted earnings (loss) per share attributable to Designer Brands Inc.
$ 0.02
$ (0.37)
Weighted average diluted shares
55,920
48,243
DESIGNER BRANDS INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited and in thousands)
May 2, 2026
January 31, 2026
May 3, 2025
ASSETS
Current assets:
Cash and cash equivalents
$ 50,104
$ 50,871
$ 46,025
Receivables, net
77,725
61,716
57,941
Inventories
586,635
563,547
623,584
Prepaid expenses and other current assets
49,703
34,286
47,975
Total current assets
764,167
710,420
775,525
Property and equipment, net
209,164
213,291
230,559
Operating lease assets
673,681
675,648
719,749
Goodwill
130,830
130,837
130,714
Intangible assets, net
80,734
81,242
85,062
Deferred tax assets
34,693
35,882
50,801
Equity investments
56,733
56,260
54,862
Other assets
48,194
46,325
46,046
Total assets
$ 1,998,196
$ 1,949,905
$ 2,093,318
LIABILITIES, REDEEMABLE NONCONTROLLING
INTEREST, AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable
$ 236,278
$ 236,195
$ 261,787
Accrued expenses
202,398
178,430
187,808
Current maturities of long-term debt
6,750
6,750
6,750
Current operating lease liabilities
158,034
175,515
158,171
Total current liabilities
603,460
596,890
614,516
Long-term debt
468,521
428,206
516,192
Non-current operating lease liabilities
593,156
596,587
650,438
Other non-current liabilities
48,562
46,606
46,478
Total liabilities
1,713,699
1,668,289
1,827,624
Redeemable noncontrolling interest
3,571
1,616
2,212
Total shareholders' equity
280,926
280,000
263,482
Total liabilities, redeemable noncontrolling interest, and
shareholders' equity
$ 1,998,196
$ 1,949,905
$ 2,093,318
DESIGNER BRANDS INC.
NON-GAAP RECONCILIATION
(unaudited and in thousands, except per share amounts)
Three months ended
May 2, 2026
May 3, 2025
Operating expenses
$ (299,209)
$ (301,862)
Non-GAAP adjustments-
Restructuring and integration costs
508
3,875
Total non-GAAP adjustments
508
3,875
Adjusted operating expenses
$ (298,701)
$ (297,987)
Operating profit (loss)
$ 18,870
$ (7,907)
Non-GAAP adjustments:
Restructuring and integration costs
508
3,875
Impairment charges
—
2,953
Total non-GAAP adjustments
508
6,828
Adjusted operating profit (loss)
$ 19,378
$ (1,079)
Net income (loss) attributable to Designer Brands Inc.
$ 1,159
$ (17,816)
Non-GAAP adjustments:
Restructuring and integration costs
508
3,875
Impairment charges
—
2,953
Interest expense on under-reported import duties
159
103
Foreign currency transaction losses (gains)
5
(8)
Total non-GAAP adjustments before tax effect
672
6,923
Tax effect of adjustments and changes in valuation allowance
(320)
(2,192)
Total non-GAAP adjustments, after tax
352
4,731
Net income attributable to redeemable noncontrolling interest
2,295
135
Adjusted net income (loss)
$ 3,806
$ (12,950)
Diluted earnings (loss) per share
$ 0.02
$ (0.37)
Adjusted diluted earnings (loss) per share
$ 0.07
$ (0.27)
Non-GAAP Measures
To supplement amounts presented in our consolidated financial statements determined in accordance with accounting principles generally accepted in the U.S. ("GAAP"), the Company uses certain non-GAAP financial measures, including adjusted operating expenses, adjusted operating profit (loss), adjusted net income (loss), and adjusted diluted earnings (loss) per share as shown in the table above. These measures adjust for the effects of: (1) restructuring and integration costs, including severance charges; (2) impairment charges; (3) interest expense on under-reported import duties; (4) foreign currency transaction losses (gains); (5) the net tax impact of such items and changes in the valuation allowance on deferred tax assets; and (6) net income attributable to redeemable noncontrolling interest. The unaudited adjusted results should not be construed as an alternative to the reported results determined in accordance with GAAP. These financial measures are not based on any standardized methodology and are not necessarily comparable to similar measures presented by other companies. The Company believes that these non-GAAP financial measures provide useful information to both management and investors to increase comparability to prior periods by adjusting for certain items that may not be indicative of core operating measures and to better identify trends in our business. The adjusted financial results are used by management to, and allow investors to, evaluate the operating performance of the Company compared to prior periods, when reviewed in conjunction with the Company's GAAP statements. These amounts are not determined in accordance with GAAP and therefore should not be used exclusively in evaluating the Company's business and operations.
Comparable Sales Performance Metric
We consider the percent change in comparable sales from the same previous year period, a primary metric commonly used throughout the retail industry, to be an important measurement for management and investors of the performance of our direct-to-consumer businesses. We include in our comparable sales metric sales from stores in operation for at least 14 months at the beginning of the applicable year. Stores are added to the comparable base at the beginning of the year and are dropped for comparative purposes in the quarter in which they are closed. Comparable sales include the e-commerce sales of the Retail segment. Comparable sales in Canada exclude the impact of foreign currency translation and are calculated by translating current period results at the foreign currency exchange rate used in the comparable period of the prior year. Comparable sales include the e-commerce net sales of the Brand Portfolio segment from the direct-to-consumer e-commerce sites. The calculation of comparable sales varies across the retail industry and, as a result, the calculations of other retail companies may not be consistent with our calculation.
SOURCE Designer Brands Inc.