Card processing fight puts Designer Brands (NYSE: DBI) U.S. sales at risk

Rhea-AI Filing Summary

Designer Brands Inc. describes a legal dispute with its primary credit and debit card processor, Worldpay, over an attempted early termination of their merchant agreement before its May 31, 2026 expiration. A court has issued a temporary restraining order keeping the agreement in place for now.

Worldpay alleges a financial default; the Company states it has reviewed the contract and its financials and believes no default occurred. Because Worldpay handles nearly all card sales in roughly 500 U.S. stores and more than half of online U.S. sales, any interruption before a replacement is ready could materially harm operations and financial performance.

Positive

• None.

Negative

• High operational concentration risk disclosed: Worldpay is the sole card processor for nearly all U.S. store sales and more than half of online U.S. sales, so any interruption before an alternative is implemented could materially harm operations and financial performance.

Insights

Retail and payments risk analyst

Designer Brands faces significant operational risk from a dispute with its sole U.S. card processor.

Designer Brands reports that Worldpay sent a termination notice and later a non-renewal notice for their card processing agreement, which otherwise runs through May 31, 2026. A court granted a temporary restraining order, indicating the Company is more likely than not to succeed on its contract claims.

The business impact centers on concentration risk. Worldpay currently processes nearly all credit and debit sales for about 500 U.S. DSW stores and more than half of U.S. online sales. The Company states that losing these services before onboarding alternatives could prevent processing a majority of credit card transactions, with a material adverse effect on operations and financial performance.

The Company is pursuing injunctive relief and damages while also seeking short-, medium-, and long-term processing solutions, either with Worldpay on new terms or with other vendors. The eventual court decision on a preliminary injunction and the timing of any transition arrangements will largely determine how much disruption, if any, actually occurs.

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): January 27, 2026

Designer Brands Inc.

(Exact name of registrant as specified in its charter)

Ohio

001-32545

31-0746639

(State or other Jurisdiction of Incorporation)

(Commission File Number)

(IRS Employer Identification No.)

810 DSW Drive, Columbus, Ohio						43219
(Address of Principal Executive Offices)						(Zip Code)

Registrant’s telephone number, including area code: (614) 237-7100

 N/A

(Former name or former address if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Class A Common Shares, without par value			DBI			New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange

Act.    ☐

Item 8.01 Other Events.

On January 27, 2026, Designer Brands Inc. (the “Company”) filed a motion for a temporary restraining order and/or preliminary injunction and a complaint for declaratory and injunctive relief in the Court of Common Pleas, in Franklin County, Ohio (the “Court”) to enjoin the purported termination by Worldpay, LLC fka Vantiv, LLC (“Worldpay”), effective as of February 2, 2026, of a Bank Card Merchant Agreement, dated on or about September 12, 2014 (the “Agreement”), pursuant to which Worldpay provides the Company and its affiliates with credit and debit card processing services for in-store and online transactions. The Agreement, by its terms, is set to expire on May 31, 2026. On January 28, 2026, the Court issued a temporary restraining order enjoining Worldpay from terminating the Agreement and ceasing its performance under the Agreement prior to May 31, 2026. The order issued by the Court found, among other things, that the Company is more likely than not to succeed on the merits of its claim for breach of contract and declaratory relief. The Court will hear the Company’s motion for preliminary injunction on a date to be determined.

Worldpay’s purported termination of the Agreement was pursuant to a termination notice (the “Notice”) delivered by Worldpay to the Company on January 22, 2026. In connection with the Notice, Worldpay offered to continue providing credit and debit card processing services to the Company for a 3-month transition period during which the Company could transition its credit and debit card processing requirements to another vendor or vendors. The Company has been engaged in discussions with Worldpay to determine whether mutually acceptable commercial terms for an amendment to the Agreement can be concluded so that Worldpay can continue to provide credit and debit card processing services during the proposed transition period. After the Court issued the temporary restraining order, Worldpay served a notice of non-renewal of the Agreement providing that the Agreement will expire by its terms on May 31, 2026, in the event that the Notice does not otherwise terminate the Agreement on an earlier date.

The Notice alleged an event of default under the Agreement based on a failure by the Company to comply with a financial metric specified in the Agreement. Following receipt of the Notice, the Company reviewed both the Agreement and its financial statements and confirmed its belief that it has been and remains in compliance with the terms of the Agreement and that an event of default under the Agreement has not occurred. Accordingly, the Company believes no default occurred under the Agreement. The Company had not anticipated Worldpay serving either the Notice or a notice of non-renewal of the existing term of the Agreement because Worldpay had given numerous assurances to the Company that it desired to extend the term of the Agreement and also provide additional services not then covered by the Agreement. Worldpay is demanding fees during its proposed transition period that are substantially more than those it would otherwise be entitled to under the Agreement through the end of the existing term and the Company has asserted that these fees are commercially unreasonable. The Company intends to vigorously enforce its contractual rights and Worldpay’s obligations under the Agreement and is seeking damages in addition to injunctive relief.

Worldpay has been paid in full and on-time during the nearly 12-year term of the Agreement and no sums are currently past due and outstanding from the Company to Worldpay.

    Worldpay is the sole credit and debit card processor for the Company’s nearly 500 DSW Designer Shoe Warehouse stores in the United States, at which credit and debit card transactions represent a nearly all sales, and the processor of more than half of the Company’s online sales in the United States. If the Court does not grant the injunctive relief we are seeking and / or we are unable to agree upon mutually acceptable terms for Worldpay to provide transition services, in either case, with the result that Worldpay discontinues credit and debit card processing services before the Company can engage an alternative vendor, we may be unable to process a majority of our credit card transactions in-store or online consistent with our prior practices. This could have a material adverse effect on the operation of our business and our financial performance. Regardless of the outcome of the legal proceedings referred to in this Current Report on Form 8-K, the Company is working to expeditiously identify short-, medium- and long-term solutions to its credit and debit card processing needs, whether with Worldpay during its proposed transition period or other qualified vendors, including those with which the Company has an existing relationship.

Cautionary Note Regarding Forward-Looking Statements

This Current Report on Form 8-K includes forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements may be identified by words such as “believes,” “could,” “continues,” “may,” “will,” “intends,” “should,” “would,” or the negative of such terms, or other comparable terminology, and include statements about the Agreement, the Notice, the temporary restraining order, and the possible impacts, if any, on the Company should Worldpay cease providing its services under the Agreement. Forward-looking statements are statements that are not historical facts. Such forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, which could cause actual results to differ materially from the forward-looking statements contained herein due to many factors. These forward-Looking statements and such risks, uncertainties, and other factors speak only as of the date of this Current Report on Form 8-K, and the Company expressly disclaims any obligation or undertaking to update or revise any forward-looking statement contained herein, or to reflect any change in our expectations

with regard thereto or any other change in events, conditions, or circumstance on which any such statement is based, except to the extent otherwise required by applicable law.

Signature  

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.  

Designer Brands Inc.

By:

/s/ Lisa M. Yerrace

Lisa M. Yerrace

Senior Vice President, General Counsel and Corporate Secretary

Date:

January 29, 2026

FAQ

What legal action did Designer Brands (DBI) take against Worldpay?

Designer Brands filed for a temporary restraining order, preliminary injunction, and declaratory and injunctive relief in an Ohio state court. It seeks to prevent Worldpay from ending a card-processing agreement early and is also pursuing damages related to Worldpay’s attempted termination and associated conduct.

Why is Worldpay’s role important to Designer Brands (DBI)?

Worldpay is the sole credit and debit card processor for nearly 500 DSW stores in the United States and handles more than half of the Company’s U.S. online sales. Any disruption in Worldpay’s services could significantly impact transaction processing and overall business performance.

What did the court decide so far in the Designer Brands–Worldpay dispute?

The Court of Common Pleas in Franklin County, Ohio issued a temporary restraining order on January 28, 2026. It prohibits Worldpay from terminating or ceasing performance under the merchant agreement before May 31, 2026, and found the Company likely to succeed on its contract claims.

What could happen if Designer Brands (DBI) loses card processing before transitioning?

Designer Brands states it may be unable to process a majority of its in-store and online credit card transactions consistent with prior practices. The Company warns this disruption in payment processing could have a material adverse effect on its business operations and overall financial performance.

How does Designer Brands (DBI) view Worldpay’s default claim?

Worldpay’s notice alleged a default based on a financial metric in the agreement. Designer Brands says it reviewed the contract and its financial statements and believes it has remained in compliance, concluding that an event of default has not occurred under the agreement’s stated terms.

Is Designer Brands (DBI) planning alternative card processing solutions?

Yes. Regardless of the litigation’s outcome, Designer Brands is working to quickly identify short-, medium-, and long-term card-processing solutions. These may involve revised commercial terms with Worldpay during a transition period or arrangements with other qualified vendors that already have relationships with the Company.