Designer Brands sales down over 9% in Q3

Designer Brands Inc., the Columbus, Ohio-based owner of the DSW Designer Shoe Warehouse, The Shoe Company and Shoe Warehouse retail chains, announced on Tuesday that net sales decreased by 9.1% in the third quarter ended October 28, 2023.

The company, which also produces footwear and accessories through Camuto Group, achieved net sales of $786.3 million, while comparable sales decreased by 9.3%.

Sales in Designer Brands’ U.S. retail segment dropped 10.6% year over year to $631,61 million, while its Canada retail segment experienced a drop of 8.1%, posting quarterly sales of $75,61 million. The company’s brand portfolio segment saw a 12.5% drop in its sales, which totaled $94,057 million.

Net income at the company was $10.1 million, or diluted earnings per share of $0.17. During the quarter, the company opened one store in the U.S. and six stores in Canada, bringing the total to 499 U.S. stores and 144 Canadian stores.

“This quarter, we were impacted by a footwear market that contracted for the first time since Covid coupled with unseasonably warm weather, which significantly reduced customer demand for shoes and pressured our heavily seasonal assortment,” said Doug Howe, chief executive officer. 

“We saw improved performance in casual and clearance categories this quarter, but this was not enough to offset the broader lack of demand. While macro pressures notably impacted our business, we clearly recognize the need to operate with even greater speed and increase the level of innovation, newness, and fashion into our assortments, returning to our roots as a merchant organization and a fashion footwear retailer.”

Looking ahead, the company revised its guidance for the full year 2023, and now anticipates a high-single-digit decline in net sales growth (excluding Keds) and adjusting diluted EPS for Designer Brands (excluding Keds) to a range of $0.40 to $0.70.