Companies

Designer Brands improves margins despite sales decline in 2025

Apr 1, 2026 United States

The US-based company has reported a 3.9% year-on-year decline in net sales to 2.9 billion US dollars for 2025. However, it has also improved its gross margins and strengthened its financial position

“Our fourth quarter and fiscal 2025 results reflect disciplined execution as we strengthened the business and delivered sequential improvement across key financial metrics throughout the year”, said Doug Howe, Chief Executive Officer. “We ended the year with fourth quarter net sales flat year-over-year and impressive gross margin expansion, driving full year adjusted operating income that significantly surpassed the high end of our guidance”, he added.

Fourth Quarter Results

In the fourth quarter of the 2025 fiscal year, Designer Brands reported net sales of 713.6 million US dollars, which were unchanged from the previous year. During this period, total comparable sales decreased by 1.9%.

In the three months to the 31^st of January, the retail segment contributed 655.9 million US dollars to the company’s total net sales, representing a 0.1% year-on-year decrease. Meanwhile, the brand portfolio segment contributed 91.9 million US dollars, representing a 5.3% year-on-year increase.

The company’s gross profit in the fourth quarter increased to 302.7 million US dollars, up from 282.6 million US dollars in the same period a year ago. The gross margin also increased, expanding from 39.6% to 42.4%.

In the final quarter of the last fiscal year, Designer Brands recorded a net loss of 20.0 million US dollars (loss per diluted share of 0.40 US dollars) and an adjusted net loss of 15.6 million US dollars (loss per diluted share of 0.31 US dollars).

Full-Year Results

The US-based company generated net sales of 2.9 billion US dollars in the 2025 financial year, reflecting a year-on-year decrease of 3.9%, with total comparable sales falling by 4.3%. The full-year gross profit margin improved to 43.6% from 42.7%.

Designer Brands also reported a net loss of 8.4 million US dollars (loss per diluted share of 0.17 US dollars), but an adjusted net income was 8.3 million US dollars (adjusted diluted earnings per share of 0.16 US dollars).

The company strengthened its financial position in 2025, achieving higher cash levels and reducing both debt and inventory.

Fiscal 2026 Outlook

“As we enter fiscal 2026, we remain focused on our strategic priorities, executing the initiatives within our control, and building on the momentum we've established”, added Doug Howe.

For the 2026 financial year, Designer Brands expects a change in net sales of between minus 1% and 1%, and diluted earnings per share of between 0.28 and 0.38 US dollars.

Image Credits: wwd.com

United States Designer Brands Footwear Quarter Results Results Year Results