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What: Shares of DSW Inc (NYSE:DBI) were tripping up investors today after reporting second-quarter earnings. As of 2:57 p.m. EDT, the shoe retailer's stock was down 11%.

So what: DSW actually beat earnings estimates, posting an adjusted per-share profit of $0.35, better than expectations at $0.30, but down from $0.42 a year ago. Same-store sales fell 1.2% in the quarter, marking the first back-to-back in comps since 2009. Revenue increased 5.1% $659 million, aided by last year's purchase of, matching estimates. 

Shares of the footwear chain were actually up in pre-market trading after the report came out, but they were down by market open and fell steadily over the session as several other apparel retailers got hammered on weak earnings reports.

CEO Roger Rawlins said the company remained on track to deliver on its full-year outlook, and that it has "positioned fall inventories conservatively" in response to muted expectations for the current quarter. Separately, the company completed a comprehensive expense review that found $25 million in annual cost savings, though that may be minimal for a company with about $3 billion in annual sales.

Now what: Looking ahead, the company maintained its full-year earnings guidance of $1.32-$1.42, though the continued decline in comparable sales and lower inventories indicates that the company's top line is moving in the wrong direction. 

In a retail environment that's been harsh on brick-and-mortar stores, DSW has continued to open new locations, growing its store count by about 7% to 480 over the last year. The company has also aggressively repurchased stock as shares outstanding fell by about 8% over the last year, artificially inflating earnings per share. Net income, without adjustments, was down by about a third in the quarter.

Despite management's efforts and the expense review plan, the company seems no closer to growing profits than it was three months ago.

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