Designer Brands faces challenging Q1 2025, withdraws guidance

Designer Brands, a designer, producer, and retailer of footwear and accessories, reported its financial results for the first quarter ended May 3, 2025, revealing a challenging start to the year.

The company saw a decrease in net sales by 8 percent to 686.9 million dollars, alongside a 7.8 percent decline in total comparable sales compared to the first quarter of 2024.

Gross profit also fell to 295.1 million dollars, with gross margin narrowing to 43 percent. The quarter concluded with a reported net loss attributable to Designer Brands Inc. of 17.4 million dollars, or a diluted loss per share of 36 cents.

Doug Howe, chief executive officer, acknowledged the difficulties, stating, "We experienced a soft start to 2025 amid an unpredictable macro environment and deteriorating consumer sentiment."

In response to this volatility, the company has strategically redirected its near-term efforts towards enhancing value in its retail channels, protecting profit margins, managing expenses, and softening the impact of tariffs. Howe highlighted the team's diligent work, anticipating "between 20 million dollars to 30 million dollars in cost savings over the course of 2025" as a direct result of their focus and discipline.

Given the ongoing market instability and pressure on consumer discretionary spending, Designer Brands has opted to retract its previously issued 2025 guidance.

Demonstrating its commitment to shareholders, a dividend of 5 cents per share for both Class A and Class B common shares is scheduled to be paid on June 18, 2025, to shareholders of record as of June 5, 2025.