Designer Brands Inc. reported a net sales decline of 3.9% for the fiscal year ending January 31, 2026, totaling $2.9 billion, down from $3.0 billion in the previous year. The company experienced a comparable sales decrease of 4.3%, with the Retail segment contributing $2.7 billion and the Brand Portfolio segment accounting for $362.9 million. Despite the revenue drop, gross profit as a percentage of net sales improved to 43.6%, up from 42.7% in 2025, reflecting enhanced operational efficiencies, particularly in digital order fulfillment.
The company’s net loss attributable to Designer Brands Inc. was $8.4 million, or $0.17 per diluted share, an improvement from a loss of $10.5 million, or $0.20 per diluted share, in the prior year. The Retail segment's operating profit decreased to $211.6 million, while the Brand Portfolio segment saw an increase in operating profit to $10.9 million, attributed to lower operating expenses despite reduced sales. The overall operating profit for the company rose to $47.8 million, a 36.7% increase compared to the previous year.
Strategically, Designer Brands completed the acquisition of Rubino Shoes Inc. in April 2024, expanding its footprint into Quebec, Canada. The company also aggregated its U.S. and Canada Retail segments into a single reportable segment, which aligns with its operational structure. As of January 31, 2026, the company employed approximately 13,000 associates, with 11,000 based in the U.S. The number of VIP reward program members decreased slightly to 30 million, generating 89% of the Retail segment's net sales.
Operationally, the company faced challenges due to macroeconomic conditions, including inflation and changing consumer preferences, which impacted customer traffic and demand. The Retail segment's comparable sales were affected by an 8% decline in transactions, although average sales per transaction increased. The Brand Portfolio segment's direct-to-consumer sales fell by 21.9%, primarily due to reduced wholesale activity. The company is actively working on inventory alignment and expense management to mitigate these impacts.
Looking ahead, Designer Brands remains cautious about the economic environment and its potential effects on consumer spending. The company is focused on enhancing its digital and in-store shopping experiences while continuing to diversify its sourcing strategies to manage costs effectively. The outlook emphasizes ongoing efforts to adapt to market conditions and consumer trends, with a commitment to maintaining operational efficiency and profitability.
About Designer Brands Inc.
Designer Brands Inc. is a leading footwear and accessories company operating retail stores and e-commerce platforms under banners like DSW, The Shoe Co., and Rubino. It designs, sources, and sells a wide range of national and owned brands, including licensed labels like Vince Camuto and Keds. The company serves North American consumers through a multi-channel model emphasizing value, style, and customer engagement.
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