| Immaterial Restatements of Prior Period Financial Statements |
IMMATERIAL RESTATEMENTS OF PRIOR PERIOD FINANCIAL STATEMENTS As discussed in Note 1, during the first quarter of 2026, we identified errors related to prior period financial statements. 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. The following table presents the prior period impact to line items shown on the condensed consolidated statements of operations and comprehensive loss: | | | | | | | | | | | | | | | | | | | (in thousands, except per share amounts) | Three months ended May 3, 2025 | | Previously Reported | | Adjustments | | As Adjusted | | Cost of sales | $ | (391,783) | | | $ | (645) | | | $ | (392,428) | | | Gross profit | $ | 295,126 | | | $ | (645) | | | $ | 294,481 | | | Operating loss | $ | (7,262) | | | $ | (645) | | | $ | (7,907) | | | Interest expense, net | $ | (11,868) | | | $ | (103) | | | $ | (11,971) | | | Loss before income taxes | $ | (19,122) | | | $ | (748) | | | $ | (19,870) | | | Income tax benefit | $ | 1,986 | | | $ | 203 | | | $ | 2,189 | | | Net loss | $ | (17,136) | | | $ | (545) | | | $ | (17,681) | | | Net income attributable to redeemable noncontrolling interest | $ | (288) | | | $ | 153 | | | $ | (135) | | | Net loss attributable to Designer Brands Inc. | $ | (17,424) | | | $ | (392) | | | $ | (17,816) | | | Basic loss per share | $ | (0.36) | | | $ | (0.01) | | | $ | (0.37) | | | Diluted loss per share | $ | (0.36) | | | $ | (0.01) | | | $ | (0.37) | | | Comprehensive loss attributable to Designer Brands Inc. | $ | (13,926) | | | $ | (392) | | | $ | (14,318) | |
The following table presents the prior period impacts to line items shown on the condensed consolidated balance sheets and the related components of shareholders' equity (beginning retained earnings for 2025 decreased $3.1 million from $77.9 million to $74.8 million): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in thousands) | January 31, 2026 | | May 3, 2025 | | Previously Reported | | Adjustments | | As Adjusted | | Previously Reported | | Adjustments | | As Adjusted | | Receivables, net | $ | 59,444 | | | $ | 2,272 | | | $ | 61,716 | | | $ | 56,159 | | | $ | 1,782 | | | $ | 57,941 | | | Total current assets | $ | 708,148 | | | $ | 2,272 | | | $ | 710,420 | | | $ | 773,743 | | | $ | 1,782 | | | $ | 775,525 | | | Total assets | $ | 1,947,633 | | | $ | 2,272 | | | $ | 1,949,905 | | | $ | 2,091,536 | | | $ | 1,782 | | | $ | 2,093,318 | | | Accrued expenses | $ | 170,014 | | | $ | 8,416 | | | $ | 178,430 | | | $ | 181,207 | | | $ | 6,601 | | | $ | 187,808 | | | Total current liabilities | $ | 588,474 | | | $ | 8,416 | | | $ | 596,890 | | | $ | 607,915 | | | $ | 6,601 | | | $ | 614,516 | | | Total liabilities | $ | 1,659,873 | | | $ | 8,416 | | | $ | 1,668,289 | | | $ | 1,821,023 | | | $ | 6,601 | | | $ | 1,827,624 | | | Redeemable noncontrolling interest | $ | 5,274 | | | $ | (3,658) | | | $ | 1,616 | | | $ | 3,573 | | | $ | (1,361) | | | $ | 2,212 | | | Retained earnings | $ | 59,869 | | | $ | (2,486) | | | $ | 57,383 | | | $ | 58,074 | | | $ | (3,458) | | | $ | 54,616 | | | Total shareholders' equity | $ | 282,486 | | | $ | (2,486) | | | $ | 280,000 | | | $ | 266,940 | | | $ | (3,458) | | | $ | 263,482 | | | Total liabilities, redeemable noncontrolling interest, and shareholders' equity | $ | 1,947,633 | | | $ | 2,272 | | | $ | 1,949,905 | | | $ | 2,091,536 | | | $ | 1,782 | | | $ | 2,093,318 | |
The following table presents the prior period impacts to line items shown on the condensed consolidated statements of cash flows: | | | | | | | | | | | | | | | | | | | (in thousands) | Three months ended May 3, 2025 | | Previously Reported | | Adjustments | | As Adjusted | | Cash flows from operating activities: | | | | | | | Net loss | $ | (17,136) | | | $ | (545) | | | $ | (17,681) | | | Change in operating assets and liabilities: | | | | | | | Receivables | $ | (5,696) | | | $ | (202) | | | $ | (5,898) | | | Accrued expenses | $ | 25,953 | | | $ | 747 | | | $ | 26,700 | | | Net cash used in operating activities | $ | (20,366) | | | $ | — | | | $ | (20,366) | |
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