Designer Brands (DBI) investor relations material

Executive summary

• Net sales for Q3 were $752.4 million, down 3.2% year-over-year, with total comparable sales down 2.4%.

• Gross margin improved by 210 basis points to 45.1%, driven by lower promotional activity and higher non-product sales.

• Diluted EPS rose to $0.35 and adjusted EPS to $0.38, both up over 40% year-over-year.

• Operating income increased to $42.7 million from $22.8 million year-over-year.

• Macroeconomic uncertainty, inflation, and tariffs continue to pressure consumer demand and operating results.

Financial highlights

• Gross profit was $339.6 million (45.1% of sales, up from 43.0%).

• Adjusted net income was $19.6 million, up from $14.5 million prior year.

• Operating margin increased to 5.7% from 2.9% year-over-year.

• Cash and cash equivalents at quarter-end were $51.4 million; total debt reduced to $469.8 million.

• Dividend of $0.05 per share declared for both Class A and B shares.

Outlook and guidance

• Fiscal 2025 net sales expected to decline 3%–5%.

• Adjusted operating income forecasted at $50–$55 million.

• Adjusted income tax expense projected at $8–$10 million.

• Management expects continued macroeconomic and tariff challenges, with ongoing cost mitigation and sourcing diversification.

• Capital expenditures for 2025 projected at $35–$45 million.