Designer Brands Inc. Reports First Quarter 2026 Financial Results
PR Newswire
COLUMBUS, Ohio, June 9, 2026
Strong momentum continued with first quarter net sales growth meeting and adjusted diluted earnings per share ("EPS") exceeding expectations
Gross margin expansion of 240 basis points
Anticipates full year 2026 EPS trending toward the high end of guidance range
COLUMBUS, Ohio, June 9, 2026 /PRNewswire/ -- Designer Brands Inc. (NYSE: DBI) (the "Company," "we," "us," "our," and "Designer Brands"), one of the world's largest designers, producers, and retailers of footwear and accessories, today announced financial results for the first quarter ended May 2, 2026.
"Our strong start to the year was underscored by double-digit sales growth in our Brand Portfolio segment and encouraging stabilization in our Retail segment," said Doug Howe, Chief Executive Officer. "In addition to top-line strength, we delivered meaningful profitability gains, with gross margin expanding 240 basis points, reflecting the structural improvements we have made across inventory management, pricing discipline, sourcing, and channel profitability."
Howe continued, "Following our encouraging start to the year, we believe in our ability to achieve the high end of our fiscal 2026 EPS guidance range, even amidst ongoing uncertainty in the macroeconomic environment. We believe our strategic actions will continue to strengthen our foundation of the business and position us well for long-term profitable growth."
First Quarter Operating Results (Unless otherwise stated, all comparisons are to the first quarter of 2025)
- Net sales increased 1.4% to $696.4 million.
- Total comparable sales decreased by 1.1%.
- Gross profit increased to $315.3 million versus $294.5 million last year, and gross margin was 45.3% compared to 42.9% last year.
- Reported net income attributable to Designer Brands Inc. was $1.2 million, or diluted EPS of $0.02.
- Adjusted net income was $3.8 million, or adjusted diluted EPS of $0.07.
Liquidity
- Cash and cash equivalents totaled $50.1 million at the end of the first quarter of 2026, compared to $46.0 million at the end of the same period last year, with $138.5 million available for borrowings under our senior secured asset-based revolving credit facility. Debt totaled $475.3 million at the end of the first quarter of 2026 compared to $522.9 million at the end of the same period last year.
- The Company ended the first quarter of 2026 with inventories of $586.6 million compared to $623.6 million at the end of the same period last year.
Store Count
(square footage in thousands) | May 2, 2026 | May 3, 2025 | |||||
Number of | Square | Number of | Square | ||||
DSW stores | 518 | 10,150 | 520 | 10,237 | |||
The Shoe Co. stores | 118 | 599 | 121 | 620 | |||
Rubino stores | 27 | 140 | 28 | 149 | |||
Total number of stores | 663 | 10,889 | 669 | 11,006 | |||
2026 Financial Outlook
The Company is reaffirming the following guidance for the full year 2026:
Metric | 2026 Guidance | |
Designer Brands Change in Net Sales | Down 1% to Up 1% | |
Diluted Earnings per Share | $0.28 - $0.38 |
Webcast and Conference Call
The Company is hosting a conference call today at 8:30 am Eastern Time. Investors and analysts interested in participating in the call are invited to dial 1-888-317-6003, or the international dial-in, 1-412-317-6061, and reference conference ID number 6930887 approximately ten minutes prior to the start of the conference call. The conference call will also be broadcast live over the internet and can be accessed through the following link, as well as through the Company's investor website at investors.designerbrands.com:
https://app.webinar.net/704rZBvZkGJ
For those unable to listen to the live webcast, an archived version will be available on the Company's investor website until June 23, 2026. A replay of the teleconference will be available by dialing the following numbers:
North America: 1-855-669-9658
International: 1-412-317-0088
Passcode: 7496602
Important information may be disseminated initially or exclusively via the Company's investor website; investors should consult the website to access this information.
About Designer Brands
Designer Brands is one of the world's largest designers, producers, and retailers of the most recognizable footwear brands and accessories, transforming and defining the footwear industry through a mission of being shoe obsessed. With a diversified, world-class portfolio of coveted brands, including Topo Athletic, Keds, Vince Camuto, Kelly & Katie, Jessica Simpson, Lucky Brand, Mix No. 6, Crown Vintage and others, Designer Brands designs and produces on-trend footwear and accessories for all of life's occasions delivered to the consumer through a robust direct-to-consumer omni-channel infrastructure and powerful national wholesale distribution. Powered by a billion-dollar digital commerce business across multiple domains and over 660 DSW Designer Shoe Warehouse, The Shoe Co., and Rubino stores in North America, Designer Brands delivers current, in-line footwear and accessories from the largest national brands in the industry and holds leading market share positions in key product categories across women's, men's, and kids'. Designer Brands also distributes its brands internationally through select wholesale and distributor relationships while also leveraging design and sourcing expertise to build private label products for national retailers. Designer Brands is committed to being a difference maker in the world and the footwear industry. By leading with our corporate values of We Belong and We Do What's Right, Designer Brands supports the global community and the health of the planet by donating more than thirteen million pairs of shoes to the global non-profit Soles4Souls since 2018. To learn more, visit www.designerbrands.com.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Certain statements in this press release may constitute forward-looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements by the use of forward-looking words such as "outlook," "could," "believes," "expects," "potential," "continues," "may," "will," "should," "would," "seeks," "approximately," "predicts," "intends," "plans," "estimates," "anticipates," or the negative version of those words or other comparable words. These statements are based on the Company's current views and expectations and involve known and unknown risks, uncertainties, and other factors, many of which are outside of the Company's control, that may cause actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. These factors include, but are not limited to: uncertain general economic and financial conditions, including economic volatility and potential downturn or recession, supply chain disruptions, new or increased tariffs and other barriers to trade, tariff refunds, fluctuating interest rates, unemployment rates and inflationary pressures, and the related impacts to consumer discretionary spending, as well as our ability to plan for and respond to the impact of these conditions; our ability to anticipate and respond to rapidly changing consumer preferences, seasonality, customer expectations, and fashion trends; the impact on our consumer traffic and demand, our business operations, and the operations of our suppliers, as we experience unseasonable weather, climate change evolves, and the frequency and severity of weather events increases; our ability to execute our business strategies, including growing our Brand Portfolio segment, enhancing in-store and digital shopping experiences, integrating previously acquired businesses and brands, and meeting consumer demands; our ability to maintain strong relationships with our suppliers, vendors, licensors, and retailer customers; risks related to losses or disruptions associated with our distribution systems, including our distribution centers and stores, and payment processing services whether as a result of reliance on third-party providers or otherwise; our reliance on third parties to provide customer payment processing services; risks related to cyber security threats and privacy or data security breaches or the potential loss or disruption of our information technology ("IT") systems, or those of our vendors; risks related to the implementation of new or updated IT systems, including the use of artificial intelligence tools; our ability to protect our reputation and to maintain the brands we license; our reliance on our reward programs and marketing to drive traffic, sales, and customer loyalty; our ability to successfully integrate new hires or changes in leadership and retain our existing management team, and to continue to attract qualified new personnel; risks related to restrictions imposed by our senior secured asset-based revolving credit facility, as amended, and our senior secured term loan credit agreement, as amended, that could limit our ability to fund our operations; our competitiveness with respect to style, price, brand availability, shopping platforms, and customer service; risks related to our international operations and our reliance on foreign sources for merchandise; our ability to comply with laws and regulations, as well as other legal obligations; risks associated with climate change and other corporate responsibility issues; and uncertainties related to future legislation, regulatory reform, policy changes, or interpretive guidance on existing legislation. Risks and other factors that could cause our actual results to differ materially from our forward-looking statements are described in the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2026 or our other reports made or filed with the Securities and Exchange Commission. All forward-looking statements speak only as of the time when made. Except as may be required by applicable law, the Company undertakes no obligation to update or revise the forward looking statements included in this press release to reflect any future events or circumstances.
DESIGNER BRANDS INC. SEGMENT RESULTS (unaudited) | |||||||||||
Net Sales | |||||||||||
Three months ended | |||||||||||
(dollars in thousands) | May 2, 2026 | May 3, 2025 | Change | ||||||||
Amount | % of | Amount | % of | Amount | % | ||||||
Segment net sales: | |||||||||||
Retail | $ 626,684 | 84.5 % | $ 627,145 | 86.7 % | $ (461) | (0.1) % | |||||
Brand Portfolio | 114,518 | 15.5 | 95,898 | 13.3 | 18,620 | 19.4 % | |||||
Total segment net sales | 741,202 | 100.0 % | 723,043 | 100.0 % | 18,159 | 2.5 % | |||||
Elimination of intersegment net sales | (44,852) | (36,134) | (8,718) | 24.1 % | |||||||
Consolidated net sales | $ 696,350 | $ 686,909 | $ 9,441 | 1.4 % | |||||||
Comparable Sales | |||
Three months ended | |||
May 2, 2026 | May 3, 2025 | ||
Change in comparable sales: | |||
Retail segment | (1.2) % | (7.5) % | |
Brand Portfolio segment - direct-to-consumer channel | 3.0 % | (27.0) % | |
Total | (1.1) % | (7.8) % | |
Gross Profit | |||||||||||||
Three months ended | |||||||||||||
(dollars in thousands) | May 2, 2026 | May 3, 2025 | Change | ||||||||||
Amount | % of | Amount | % of | Amount | % | Basis | |||||||
Segment gross profit: | |||||||||||||
Retail | $ 284,296 | 45.4 % | $ 268,200 | 42.8 % | $ 16,096 | 6.0 % | 260 | ||||||
Brand Portfolio | 38,877 | 33.9 % | 26,026 | 27.1 % | 12,851 | 49.4 % | 680 | ||||||
Total segment gross profit | 323,173 | 43.6 % | 294,226 | 40.7 % | 28,947 | 9.8 % | 290 | ||||||
Net recognition (elimination) of | (7,855) | 255 | (8,110) | ||||||||||
Consolidated gross profit | $ 315,318 | 45.3 % | $ 294,481 | 42.9 % | $ 20,837 | 7.1 % | 240 | ||||||
Intersegment Recognition and Elimination Activity | |||
Three months ended | |||
(in thousands) | May 2, 2026 | May 3, 2025 | |
Intersegment recognition and elimination activity: | |||
Elimination of net sales recognized by Brand Portfolio segment | $ (44,852) | $ (36,134) | |
Cost of sales: | |||
Elimination of cost of sales recognized by Brand Portfolio segment | 28,003 | 25,814 | |
Recognition of intersegment gross profit for inventory previously purchased | 8,994 | 10,575 | |
$ (7,855) | $ 255 | ||
Operating Profit | |||||||||||||
Three months ended | |||||||||||||
(dollars in thousands) | May 2, 2026 | May 3, 2025 | Change | ||||||||||
Amount | % of | Amount | % of | Amount | % | Basis | |||||||
Segment operating profit: | |||||||||||||
Retail | $ 51,278 | 8.2 % | $ 39,973 | 6.4 % | $ 11,305 | 28.3 % | 180 | ||||||
Brand Portfolio | 15,423 | 13.5 % | 1,946 | 2.0 % | 13,477 | 692.5 % | 1,150 | ||||||
Total segment operating profit | 66,701 | 9.0 % | 41,919 | 5.8 % | 24,782 | 59.1 % | 320 | ||||||
Corporate/eliminations | (47,831) | (49,826) | 1,995 | (4.0) % | |||||||||
Consolidated operating profit | $ 18,870 | 2.7 % | $ (7,907) | (1.2) % | $ 26,777 | NM | NM | ||||||
Immaterial Restatements of Prior Period Financial Results |
During the first quarter of 2026, we identified that our previously acquired Topo business was utilizing incorrect duty rates applied to many of our Topo branded products imported into the U.S., both before and after the acquisition date. While the prior period amounts have been restated, as detailed below for comparability, the impact of the corrections in periods prior to the first quarter of 2026 are not material to the consolidated financial statements in any of the impacted periods. For additional information, refer to Notes 1 and 12 to our Form 10-Q for the period ended May 2, 2026. |
(in thousands, except per share amounts, unaudited) | Three months ended May 3, 2025 | ||||
Previously Reported | % of Net | Adjustments | As Adjusted | % of Net | |
Consolidated: | |||||
Net sales | $ 686,909 | 100.0 % | $ — | $ 686,909 | 100.0 % |
Cost of sales | (391,783) | (57.0) | (645) | (392,428) | (57.1) |
Gross profit | $ 295,126 | 43.0 % | $ (645) | $ 294,481 | 42.9 % |
Operating loss | $ (7,262) | (1.1) % | $ (645) | $ (7,907) | (1.2) % |
Net loss attributable to Designer Brands Inc. | $ (17,424) | $ (392) | $ (17,816) | ||
Diluted loss per share | $ (0.36) | $ (0.01) | $ (0.37) | ||
Brand Portfolio segment: | |||||
Net sales | $ 95,898 | 100.0 % | $ — | $ 95,898 | 100.0 % |
Cost of sales | (69,227) | (72.2) | (645) | (69,872) | (72.9) |
Gross profit | $ 26,671 | 27.8 % | $ (645) | $ 26,026 | 27.1 % |
Operating profit | $ 2,591 | 2.7 % | $ (645) | $ 1,946 | 2.0 % |
(in thousands, except per share | Three months ended August 2, 2025 | Six months ended August 2, 2025 | |||||||||
Previously | % of Net | Adjustments | As | % of Net | Previously | % of Net | Adjustments | As | % of Net | ||
Consolidated: | |||||||||||
Net sales | $ 739,762 | 100.0 % | $ — | $ 739,762 | 100.0 % | $ 1,426,671 | 100.0 % | $ — | $ 1,426,671 | 100.0 % | |
Cost of sales | (416,829) | (56.3) | (440) | (417,269) | (56.4) | (808,612) | (56.7) | (1,085) | (809,697) | (56.8) | |
Gross profit | $ 322,933 | 43.7 % | $ (440) | $ 322,493 | 43.6 % | $ 618,059 | 43.3 % | $ (1,085) | $ 616,974 | 43.2 % | |
Operating income | $ 26,583 | 3.6 % | $ (440) | $ 26,143 | 3.5 % | $ 19,321 | 1.4 % | $ (1,085) | $ 18,236 | 1.3 % | |
Net income (loss) attributable to Designer Brands Inc. | $ 10,827 | $ (292) | $ 10,535 | $ (6,597) | $ (684) | $ (7,281) | |||||
Diluted earnings (loss) per share | $ 0.22 | $ (0.01) | $ 0.21 | $ (0.14) | $ (0.01) | $ (0.15) | |||||
Brand Portfolio segment: | |||||||||||
Net sales | $ 73,157 | 100.0 % | $ — | $ 73,157 | 100.0 % | $ 169,055 | 100.0 % | $ — | $ 169,055 | 100.0 % | |
Cost of sales | (54,649) | (74.7) | (440) | (55,089) | (75.3) | (123,876) | (73.3) | (1,085) | (124,961) | (73.9) | |
Gross profit | $ 18,508 | 25.3 % | $ (440) | $ 18,068 | 24.7 % | $ 45,179 | 26.7 % | $ (1,085) | $ 44,094 | 26.1 % | |
Operating loss | $ (3,606) | (4.9) % | $ (440) | $ (4,046) | (5.5) % | $ (1,015) | (0.6) % | $ (1,085) | $ (2,100) | (1.2) % | |
(in thousands, except per share | Three months ended November 1, 2025 | Nine months ended November 1, 2025 | |||||||||
Previously | % of Net | Adjustments | As | % of Net | Previously | % of Net | Adjustments | As | % of Net | ||
Consolidated: | |||||||||||
Net sales | $ 752,411 | 100.0 % | $ — | $ 752,411 | 100.0 % | $ 2,179,082 | 100.0 % | $ — | $ 2,179,082 | 100.0 % | |
Cost of sales | (412,792) | (54.9) | (359) | (413,151) | (54.9) | (1,221,404) | (56.1) | (1,444) | (1,222,848) | (56.1) | |
Gross profit | $ 339,619 | 45.1 % | $ (359) | $ 339,260 | 45.1 % | $ 957,678 | 43.9 % | $ (1,444) | $ 956,234 | 43.9 % | |
Operating income | $ 42,663 | 5.7 % | $ (359) | $ 42,304 | 5.6 % | $ 61,984 | 2.8 % | $ (1,444) | $ 60,540 | 2.8 % | |
Net income attributable to Designer Brands Inc. | $ 18,215 | $ 991 | $ 19,206 | $ 11,618 | $ 307 | $ 11,925 | |||||
Diluted earnings per share | $ 0.35 | $ 0.02 | $ 0.37 | $ 0.23 | $ 0.01 | $ 0.24 | |||||
Brand Portfolio segment: | |||||||||||
Net sales | $ 101,923 | 100.0 % | $ — | $ 101,923 | 100.0 % | $ 270,978 | 100.0 % | $ — | $ 270,978 | 100.0 % | |
Cost of sales | (72,955) | (71.6) | (359) | (73,314) | (71.9) | (196,831) | (72.6) | (1,444) | (198,275) | (73.2) | |
Gross profit | $ 28,968 | 28.4 % | $ (359) | $ 28,609 | 28.1 % | $ 74,147 | 27.4 % | $ (1,444) | $ 72,703 | 26.8 % | |
Operating income | $ 8,256 | 8.1 % | $ (359) | $ 7,897 | 7.7 % | $ 7,241 | 2.7 % | $ (1,444) | $ 5,797 | 2.1 % | |
(in thousands, except per share | Three months ended January 31, 2026 | Twelve months ended January 31, 2026 | |||||||||
Previously | % of Net | Adjustments | As | % of Net | Previously | % of Net | Adjustments | As | % of Net | ||
Consolidated: | |||||||||||
Net sales | $ 713,589 | 100.0 % | $ — | $ 713,589 | 100.0 % | $ 2,892,671 | 100.0 % | $ — | $ 2,892,671 | 100.0 % | |
Cost of sales | (410,877) | (57.6) | (630) | (411,507) | (57.7) | (1,632,281) | (56.4) | (2,074) | (1,634,355) | (56.5) | |
Gross profit | $ 302,712 | 42.4 % | $ (630) | $ 302,082 | 42.3 % | $ 1,260,390 | 43.6 % | $ (2,074) | $ 1,258,316 | 43.5 % | |
Operating income (loss) | $ (14,220) | (2.0) % | $ (630) | $ (14,850) | (2.1) % | $ 47,764 | 1.7 % | $ (2,074) | $ 45,690 | 1.6 % | |
Net loss attributable to Designer Brands Inc. | $ (19,992) | $ 273 | $ (19,719) | $ (8,374) | $ 580 | $ (7,794) | |||||
Diluted loss per share | $ (0.40) | $ — | $ (0.40) | $ (0.17) | $ 0.01 | $ (0.16) | |||||
Brand Portfolio segment: | |||||||||||
Net sales | $ 91,883 | 100.0 % | $ — | $ 91,883 | 100.0 % | $ 362,861 | 100.0 % | $ — | $ 362,861 | 100.0 % | |
Cost of sales | (63,239) | (68.8) | (630) | (63,869) | (69.5) | (260,070) | (71.7) | (2,074) | (262,144) | (72.2) | |
Gross profit | $ 28,644 | 31.2 % | $ (630) | $ 28,014 | 30.5 % | $ 102,791 | 28.3 % | $ (2,074) | $ 100,717 | 27.8 % | |
Operating income | $ 3,667 | 4.0 % | $ (630) | $ 3,037 | 3.3 % | $ 10,908 | 3.0 % | $ (2,074) | $ 8,834 | 2.4 % | |
DESIGNER BRANDS INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited and in thousands, except per share amounts) | |||
Three months ended | |||
May 2, 2026 | May 3, 2025 | ||
Net sales | $ 696,350 | $ 686,909 | |
Cost of sales | (381,032) | (392,428) | |
Gross profit | 315,318 | 294,481 | |
Operating expenses | (299,209) | (301,862) | |
Income from equity investments | 2,761 | 2,427 | |
Impairment charges | — | (2,953) | |
Operating profit (loss) | 18,870 | (7,907) | |
Interest expense, net | (10,125) | (11,971) | |
Non-operating income (expenses), net | (5) | 8 | |
Income (loss) before income taxes and loss from equity investment | 8,740 | (19,870) | |
Income tax benefit (provision) | (4,805) | 2,189 | |
Loss from equity investment | (481) | — | |
Net income (loss) | 3,454 | (17,681) | |
Net income attributable to redeemable noncontrolling interest | (2,295) | (135) | |
Net income (loss) attributable to Designer Brands Inc. | $ 1,159 | $ (17,816) | |
Diluted earnings (loss) per share attributable to Designer Brands Inc. | $ 0.02 | $ (0.37) | |
Weighted average diluted shares | 55,920 | 48,243 | |
DESIGNER BRANDS INC. CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited and in thousands) | |||||
May 2, 2026 | January 31, 2026 | May 3, 2025 | |||
ASSETS | |||||
Current assets: | |||||
Cash and cash equivalents | $ 50,104 | $ 50,871 | $ 46,025 | ||
Receivables, net | 77,725 | 61,716 | 57,941 | ||
Inventories | 586,635 | 563,547 | 623,584 | ||
Prepaid expenses and other current assets | 49,703 | 34,286 | 47,975 | ||
Total current assets | 764,167 | 710,420 | 775,525 | ||
Property and equipment, net | 209,164 | 213,291 | 230,559 | ||
Operating lease assets | 673,681 | 675,648 | 719,749 | ||
Goodwill | 130,830 | 130,837 | 130,714 | ||
Intangible assets, net | 80,734 | 81,242 | 85,062 | ||
Deferred tax assets | 34,693 | 35,882 | 50,801 | ||
Equity investments | 56,733 | 56,260 | 54,862 | ||
Other assets | 48,194 | 46,325 | 46,046 | ||
Total assets | $ 1,998,196 | $ 1,949,905 | $ 2,093,318 | ||
LIABILITIES, REDEEMABLE NONCONTROLLING | |||||
Current liabilities: | |||||
Accounts payable | $ 236,278 | $ 236,195 | $ 261,787 | ||
Accrued expenses | 202,398 | 178,430 | 187,808 | ||
Current maturities of long-term debt | 6,750 | 6,750 | 6,750 | ||
Current operating lease liabilities | 158,034 | 175,515 | 158,171 | ||
Total current liabilities | 603,460 | 596,890 | 614,516 | ||
Long-term debt | 468,521 | 428,206 | 516,192 | ||
Non-current operating lease liabilities | 593,156 | 596,587 | 650,438 | ||
Other non-current liabilities | 48,562 | 46,606 | 46,478 | ||
Total liabilities | 1,713,699 | 1,668,289 | 1,827,624 | ||
Redeemable noncontrolling interest | 3,571 | 1,616 | 2,212 | ||
Total shareholders' equity | 280,926 | 280,000 | 263,482 | ||
Total liabilities, redeemable noncontrolling interest, and | $ 1,998,196 | $ 1,949,905 | $ 2,093,318 | ||
DESIGNER BRANDS INC. NON-GAAP RECONCILIATION (unaudited and in thousands, except per share amounts) | |||
Three months ended | |||
May 2, 2026 | May 3, 2025 | ||
Operating expenses | $ (299,209) | $ (301,862) | |
Non-GAAP adjustments- | |||
Restructuring and integration costs | 508 | 3,875 | |
Total non-GAAP adjustments | 508 | 3,875 | |
Adjusted operating expenses | $ (298,701) | $ (297,987) | |
Operating profit (loss) | $ 18,870 | $ (7,907) | |
Non-GAAP adjustments: | |||
Restructuring and integration costs | 508 | 3,875 | |
Impairment charges | — | 2,953 | |
Total non-GAAP adjustments | 508 | 6,828 | |
Adjusted operating profit (loss) | $ 19,378 | $ (1,079) | |
Net income (loss) attributable to Designer Brands Inc. | $ 1,159 | $ (17,816) | |
Non-GAAP adjustments: | |||
Restructuring and integration costs | 508 | 3,875 | |
Impairment charges | — | 2,953 | |
Interest expense on under-reported import duties | 159 | 103 | |
Foreign currency transaction losses (gains) | 5 | (8) | |
Total non-GAAP adjustments before tax effect | 672 | 6,923 | |
Tax effect of adjustments and changes in valuation allowance | (320) | (2,192) | |
Total non-GAAP adjustments, after tax | 352 | 4,731 | |
Net income attributable to redeemable noncontrolling interest | 2,295 | 135 | |
Adjusted net income (loss) | $ 3,806 | $ (12,950) | |
Diluted earnings (loss) per share | $ 0.02 | $ (0.37) | |
Adjusted diluted earnings (loss) per share | $ 0.07 | $ (0.27) | |
Non-GAAP Measures
To supplement amounts presented in our consolidated financial statements determined in accordance with accounting principles generally accepted in the U.S. ("GAAP"), the Company uses certain non-GAAP financial measures, including adjusted operating expenses, adjusted operating profit (loss), adjusted net income (loss), and adjusted diluted earnings (loss) per share as shown in the table above. These measures adjust for the effects of: (1) restructuring and integration costs, including severance charges; (2) impairment charges; (3) interest expense on under-reported import duties; (4) foreign currency transaction losses (gains); (5) the net tax impact of such items and changes in the valuation allowance on deferred tax assets; and (6) net income attributable to redeemable noncontrolling interest. The unaudited adjusted results should not be construed as an alternative to the reported results determined in accordance with GAAP. These financial measures are not based on any standardized methodology and are not necessarily comparable to similar measures presented by other companies. The Company believes that these non-GAAP financial measures provide useful information to both management and investors to increase comparability to prior periods by adjusting for certain items that may not be indicative of core operating measures and to better identify trends in our business. The adjusted financial results are used by management to, and allow investors to, evaluate the operating performance of the Company compared to prior periods, when reviewed in conjunction with the Company's GAAP statements. These amounts are not determined in accordance with GAAP and therefore should not be used exclusively in evaluating the Company's business and operations.
Comparable Sales Performance Metric
We consider the percent change in comparable sales from the same previous year period, a primary metric commonly used throughout the retail industry, to be an important measurement for management and investors of the performance of our direct-to-consumer businesses. We include in our comparable sales metric sales from stores in operation for at least 14 months at the beginning of the applicable year. Stores are added to the comparable base at the beginning of the year and are dropped for comparative purposes in the quarter in which they are closed. Comparable sales include the e-commerce sales of the Retail segment. Comparable sales in Canada exclude the impact of foreign currency translation and are calculated by translating current period results at the foreign currency exchange rate used in the comparable period of the prior year. Comparable sales include the e-commerce net sales of the Brand Portfolio segment from the direct-to-consumer e-commerce sites. The calculation of comparable sales varies across the retail industry and, as a result, the calculations of other retail companies may not be consistent with our calculation.
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SOURCE Designer Brands Inc.
