Shares of Designer Brands Inc. (DBI), the parent company of DSW, plunged more than 20% on Tuesday after the company posted weaker-than-expected first-quarter results and pulled its full-year 2025 guidance amid mounting economic uncertainty.
The Columbus, Ohio-based footwear retailer reported an adjusted loss of 26 cents per share, significantly wider than the 6-cent loss projected by analysts surveyed by Visible Alpha. Net sales for the quarter dropped 8% year-over-year to $686.9 million, falling short of the estimated $732.9 million.
Pre-market, DBI shares were down 24%, reflecting investor concern over what the company described as a soft start to the year.
“We experienced a soft start to 2025 amid an unpredictable macro environment and deteriorating consumer sentiment,” said Doug Howe, CEO of Designer Brands Inc.
Broken down by segment, the U.S. Retail division reported a 7.7% decline in net sales to $573.2 million from $621.4 million a year ago. Canada Retail sales slipped 2.9% to $53.9 million, while Brand Portfolio sales fell 7.9% to $95.9 million, down from $104.1 million in Q1 2024.
The company also reported a net loss of $17.4 million, or a diluted loss of 36 cents per share, compared to net income of $783,000, or earnings of 1 cent per share in the same quarter last year.
“We have shifted our near-term focus to amplifying value in our retail channels, preserving margins, controlling costs, and mitigating the impact of tariffs as part of our response to this volatility,” Howe said.
He added that the company is aiming for $20 million to $30 million in cost savings in 2025, attributing the effort to the team’s “focus and discipline.”
However, given what it described as growing uncertainty around global trade policies, Designer Brands announced it is withdrawing its full-year 2025 guidance, which was originally issued in March.
Designer Brands said it was pulling its full-year projections “due to macroeconomic uncertainty stemming primarily from global trade policies.”
Previously, the company had projected low single-digit net sales growth and diluted earnings per share of 30 to 50 cents for fiscal 2025.
“Given the persistent instability and pressure on consumer discretionary spend, we’ve made the decision to withdraw our 2025 guidance for the time being,” Howe said. “Moving forward, our efforts remain focused on disciplined execution of the initiatives within our control to build a business rooted in the strength of our brand, centered on the customer, and positioned for long-term value creation.”
As of the latest trading session, Designer Brands shares were down 22%, extending their year-to-date loss to 45%.
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