What happened 

Consumer-brand specialist Iconix Brand Group (NASDAQ:ICON) stock sank 16% last month, according to data from S&P Global Market Intelligence.

ICON Chart

ICON data by YCharts

The slump has contributed to a rough run for shareholders lately, with the stock down 40% so far in 2017, compared with a 10% gain in the broader market.

So what

August's decline was driven by preliminary second-quarter earnings results, issued early in the month, that showed stubbornly weak operating trends. While the company made progress in shoring up its balance sheet by paying down debt, sales growth was disappointing. In fact, licensing revenue fell 7% to mark just a minor improvement over the prior quarter's 11% dip. 

A man holding shopping bags while walking down the street.

Image source: Getty Images.

CEO John Haugh highlighted Iconix's success at reducing its debt burden in a press release to investors but admitted that "organic growth is taking longer than originally anticipated."

Now what

The company's guidance now calls for full-year revenue to be between $225 milion and $235 million, compared with the range of $235 million to $245 million that Haugh and his team issued back in May. Iconix also predicts the smaller sales base will reduce earnings, relative to its prior target. 

Executives say that with their major financing moves behind them, they are now focused on returning the company to growth. But until investors see evidence that those initiatives are boosting results, they're likely to continue avoiding this stock.