| Immaterial Restatements of Prior Period Financial Statements |
IMMATERIAL RESTATEMENTS OF PRIOR PERIOD FINANCIAL STATEMENTS As discussed in Note 1, Description of Business and Significant Accounting Policies - Immaterial Restatements of Prior Periods, 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 income (loss): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (in thousands, except per share amounts) | Three months ended August 2, 2025 | | Six months ended August 2, 2025 | | Previously Reported | | Adjustments | | As Adjusted | | Previously Reported | | Adjustments | | As Adjusted | | Cost of sales | $ | (416,829) | | | $ | (440) | | | $ | (417,269) | | | $ | (808,612) | | | $ | (1,085) | | | $ | (809,697) | | | Gross profit | $ | 322,933 | | | $ | (440) | | | $ | 322,493 | | | $ | 618,059 | | | $ | (1,085) | | | $ | 616,974 | | | Operating profit | $ | 26,583 | | | $ | (440) | | | $ | 26,143 | | | $ | 19,321 | | | $ | (1,085) | | | $ | 18,236 | | | Interest expense, net | $ | (11,667) | | | $ | (116) | | | $ | (11,783) | | | $ | (23,535) | | | $ | (219) | | | $ | (23,754) | | | Income (loss) before income taxes | $ | 14,838 | | | $ | (556) | | | $ | 14,282 | | | $ | (4,284) | | | $ | (1,304) | | | $ | (5,588) | | | Income tax provision | $ | (3,557) | | | $ | 149 | | | $ | (3,408) | | | $ | (1,571) | | | $ | 352 | | | $ | (1,219) | | | Net income (loss) | $ | 11,281 | | | $ | (407) | | | $ | 10,874 | | | $ | (5,855) | | | $ | (952) | | | $ | (6,807) | | | Net income attributable to redeemable noncontrolling interest | $ | (454) | | | $ | 115 | | | $ | (339) | | | $ | (742) | | | $ | 268 | | | $ | (474) | | | Net income (loss) attributable to Designer Brands Inc. | $ | 10,827 | | | $ | (292) | | | $ | 10,535 | | | $ | (6,597) | | | $ | (684) | | | $ | (7,281) | | | Basic earnings (loss) per share | $ | 0.22 | | | $ | (0.01) | | | $ | 0.21 | | | $ | (0.14) | | | $ | (0.01) | | | $ | (0.15) | | | Diluted earnings (loss) per share | $ | 0.22 | | | $ | (0.01) | | | $ | 0.21 | | | $ | (0.14) | | | $ | (0.01) | | | $ | (0.15) | | | Comprehensive income (loss) attributable to Designer Brands Inc. | $ | 10,836 | | | $ | (292) | | | $ | 10,544 | | | $ | (3,090) | | | $ | (684) | | | $ | (3,774) | |
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 | | August 2, 2025 | | Previously Reported | | Adjustments | | As Adjusted | | Previously Reported | | Adjustments | | As Adjusted | | Receivables, net | $ | 59,444 | | | $ | 2,272 | | | $ | 61,716 | | | $ | 55,675 | | | $ | 1,932 | | | $ | 57,607 | | | Total current assets | $ | 708,148 | | | $ | 2,272 | | | $ | 710,420 | | | $ | 751,925 | | | $ | 1,932 | | | $ | 753,857 | | | Total assets | $ | 1,947,633 | | | $ | 2,272 | | | $ | 1,949,905 | | | $ | 2,061,731 | | | $ | 1,932 | | | $ | 2,063,663 | | | Accrued expenses | $ | 170,014 | | | $ | 8,416 | | | $ | 178,430 | | | $ | 170,333 | | | $ | 7,158 | | | $ | 177,491 | | | Total current liabilities | $ | 588,474 | | | $ | 8,416 | | | $ | 596,890 | | | $ | 573,495 | | | $ | 7,158 | | | $ | 580,653 | | | Total liabilities | $ | 1,659,873 | | | $ | 8,416 | | | $ | 1,668,289 | | | $ | 1,777,720 | | | $ | 7,158 | | | $ | 1,784,878 | | | Redeemable noncontrolling interest | $ | 5,274 | | | $ | (3,658) | | | $ | 1,616 | | | $ | 3,214 | | | $ | (1,476) | | | $ | 1,738 | | | Retained earnings | $ | 59,869 | | | $ | (2,486) | | | $ | 57,383 | | | $ | 66,493 | | | $ | (3,750) | | | $ | 62,743 | | | Total shareholders' equity | $ | 282,486 | | | $ | (2,486) | | | $ | 280,000 | | | $ | 280,797 | | | $ | (3,750) | | | $ | 277,047 | | | Total liabilities, redeemable noncontrolling interest, and shareholders' equity | $ | 1,947,633 | | | $ | 2,272 | | | $ | 1,949,905 | | | $ | 2,061,731 | | | $ | 1,932 | | | $ | 2,063,663 | |
The following table presents the prior period impacts to line items shown on the condensed consolidated statements of cash flows: | | | | | | | | | | | | | | | | | | | (in thousands) | Six months ended August 2, 2025 | | Previously Reported | | Adjustments | | As Adjusted | | Cash flows from operating activities: | | | | | | | Net loss | $ | (5,855) | | | $ | (952) | | | $ | (6,807) | | | Change in operating assets and liabilities: | | | | | | | Receivables | $ | (5,223) | | | $ | (352) | | | $ | (5,575) | | | Accrued expenses | $ | 15,005 | | | $ | 1,304 | | | $ | 16,309 | | | Net cash provided by operating activities | $ | 1,077 | | | $ | — | | | $ | 1,077 | |
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