Designer Brands Inc (NYSE:DBI), one of the world’s largest designers, producers, and retailers of footwear and accessories, stock rose 0.97% (As on September 12, 11:23:42 AM UTC-4, Source: Google Finance) after the company reported second quarter earnings that missed estimates and slashed its full-year outlook. During the second quarter, the company drove athleisure category sales growth of 8% in the U.S. Retail segment over the same period last year, outpacing overall athleisure market growth by over 4 percentage points, and total U.S. Retail sales outpaced the footwear market by 1 percentage point according to Circana. Total comparable sales decreased by 1.4%. Gross profit decreased to $252.9 million versus $273.4 million last year, and gross margin was 32.8% compared to 34.5% last year. The company reported net income attributable to Designer Brands Inc. was $13.8 million. Cash and cash equivalents totaled $38.8 million at the end of the second quarter of 2024, compared to $46.2 million at the end of the same period last year, with $155.1 million available for borrowings under our senior secured asset-based revolving credit facility. Debt totaled $465.7 million at the end of the second quarter of 2024 compared to $331.0 million at the end of the same period last year. The Company ended the second quarter with inventories of $642.8 million compared to $606.8 million at the end of the same period last year. During the second quarter of 2024, the Company closed one store in the United States (“U.S.”) and opened two stores in Canada, resulting in a total of 499 stores in the U.S. and 177 stores in Canada as of August 3, 2024. The company’s strategic shift from dress and seasonal footwear to athletic and casual categories is underway.

DBI in the second quarter of FY 24 has reported the adjusted earnings per share of 29 cents, missing the analysts’ estimates for the adjusted earnings per share of 58 cents. The company had reported the adjusted revenue decline of 2.6 percent to $771.9 million in the second quarter of FY 24, missing the analysts’ estimates for revenue of $813.64 million.

Designer Brands significantly lowered its fiscal 2024 earnings guidance to $0.50-$0.60 per share, down from its previous outlook of $0.70-$0.80 and well below analysts’ expectations of $0.75 per share. The company now expects full-year revenue to be flat to up low-single digits, compared to its prior forecast for low-single digit growth.