| Segment Reporting |
12. SEGMENT REPORTING As of August 3, 2025 and July 28, 2024, we had one reportable segment. The Company’s operating segment is based on how the Chief Operating Decision Maker (“CODM”) makes decisions about allocating resources and assessing performance. Our CODM is our Chief Executive Officer and the CODM receives discrete financial information for the Company’s gross margin and a summarized comprehensive statement of income monthly that categorizes selling, general and administrative expenses into four line items with remaining expenses and expenditures for long-lived assets being consolidated as an omnichannel business. The following table summarizes the Company’s gross margin and selling, general and administrative expenses. | | | | | | | | | | | | | | | Three Months Ended | | Six Months Ended | | | August 3, 2025 | | July 28, 2024 | | August 3, 2025 | | July 28, 2024 | | | (13 weeks) | | (13 weeks) | | (26 weeks) | | (26 weeks) | (in thousands) | | | | | | | | | | | | | | | | | | | | | | | | | | Net sales | | $ | 131,716 | | $ | 141,619 | | $ | 234,420 | | $ | 258,303 | Cost of goods sold | | | 59,697 | | | 67,623 | | | 109,046 | | | 122,683 | Gross margin | | $ | 72,019 | | $ | 73,996 | | $ | 125,374 | | $ | 135,620 | Less: | | | | | | | | | | | | | Outbound shipping expenses | | $ | 5,976 | | $ | 8,635 | | $ | 12,162 | | $ | 15,394 | Advertising expenses | | | 11,756 | | | 11,803 | | | 21,832 | | | 23,785 | Variable expenses | | | 11,900 | | | 12,088 | | | 22,786 | | | 22,734 | Overhead expenses | | | 39,135 | | | 41,471 | | | 77,694 | | | 82,679 | Total selling, general and administrative | | | 68,767 | | | 73,997 | | | 134,474 | | | 144,592 | Restructuring Expense | | | 850 | | | 1,596 | | | 850 | | | 1,596 | Operating loss | | | 2,402 | | | (1,597) | | | (9,950) | | | (10,568) | Interest expense | | | 1,469 | | | 988 | | | 2,950 | | | 1,981 | Other (loss) income, net | | | (82) | | | 145 | | | (243) | | | 161 | Income (loss) before income taxes | | | 851 | | | (2,440) | | | (13,143) | | | (12,388) | Income tax (benefit) expense | | | (442) | | | (470) | | | 828 | | | (2,553) | Net income (loss) | | | 1,293 | | | (1,970) | | | (13,971) | | | (9,835) | Less: Net income attributable to noncontrolling interest | | | 32 | | | 11 | | | 61 | | | 19 | Net income (loss) attributable to controlling interest | | $ | 1,261 | | $ | (1,981) | | $ | (14,032) | | $ | (9,854) | | | | | | | | | | | | | |
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