Investing.com- On Tuesday, Designer Brands Inc. (NYSE: DBI) announced first quarter results and disappointing full-year guidance that overshadowed a strong earnings beat.

The footwear retailer’s shares fell 9% in pre-market trading following the announcement.

The company reported adjusted EPS of $0.07 for the first quarter ended May 2, beating analyst estimates of -$0.09 by $0.16. However, revenue of $696.3 million came in slightly below the consensus estimate of $700.24 million, though up 1.4% YoY from $686.9 million.

The company reaffirmed its full-year 2026 EPS guidance range of $0.28 to $0.38, with the midpoint of $0.33 falling short of the analyst consensus of $0.40.

Gross margin expanded 240 basis points to 45.3% from 42.9% in the prior year period, driven by improvements in inventory management, pricing discipline, and channel profitability.

The Brand Portfolio segment showed particular strength with net sales surging 19.4% to $114.5 million, while the Retail segment remained essentially flat.

"Our strong start to the year was underscored by double-digit sales growth in our Brand Portfolio segment and encouraging stabilization in our Retail segment," said Doug Howe, Chief Executive Officer. "Following our encouraging start to the year, we believe in our ability to achieve the high end of our fiscal 2026 EPS guidance range, even amidst ongoing uncertainty in the macroeconomic environment."

The company maintained its full-year 2026 net sales guidance of down 1% to up 1%. Inventories declined to $586.6 million from $623.6 million in the prior year period, while debt decreased to $475.3 million from $522.9 million.