“Our second quarter results were highlighted by a 280-basis point sequential improvement in comparable sales from the first quarter, underscoring the impact of our targeted operational initiatives. These initiatives supported a strong start to the back-to-school season within the U.S. Retail segment as well as gradual improvements in traffic and a notable uptick in conversion”, commented Doug Howe, Chief Executive Officer.

Second Quarter Results

In the three months ending on the 2^nd of August, the company’s net sales amounted to 739.8 million US dollars, reflecting a 4.2% decrease, on a comparable basis to the same period last year. Total comparable sales decreased by 5.0% during this period, which is an improvement on the 7.8% year-on-year decline recorded in the first quarter.

The US retail segment contributed 610.9 million US dollars to Designer Brands’ total net sales, a 4.8% year-on-year decline in the second quarter of fiscal year 2025, accounting for 80.5% of total net sales.

In contrast, the Canadian retail segment recorded a modest increase of 0.4% year-on-year in the second quarter to reach 75.1 million US dollars. Meanwhile, the brand portfolio segment saw a sharp year-on-year decline of 23.8% to 73.2 million US dollars.

In the second quarter of the current financial year, the company’s gross profit decreased from 339.5 million US dollars to 322.9 million US dollars, with the gross margin contracting from 44.0% to 43.7%.

Designer Brands reported net income of 10.8 million US dollars to the company, or diluted earnings per share of 0.22 US dollars. This is compared to net income of 13.8 million US dollars, or diluted earnings per share of 0.24 US dollars, in the same period a year ago.

By the end of the second quarter, the company had reported cash and cash equivalents of 44.9 million US dollars, up from 38.8 million US dollars the previous year. Total debt increased from 465.7 million US dollars in the same period last year to 516.3 million US dollars. Meanwhile, inventories fell from 642.8 million US dollars to 610.9 million US dollars by the end of the quarter.

“While consumer sentiment has ticked up slightly, given the ongoing macroeconomic volatility with recent extended tariff increases and caution in discretionary spending, there is still a notable amount of uncertainty. That said, we remain committed to disciplined execution in those areas within our control as we navigate the near-term environment while continuing to build a stronger, more sustainable business for the future”, concluded Howe.

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