Impairment |
6 Months Ended |
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Aug. 03, 2025 | |
Impairment [Abstract] | |
Impairment | Impairment Our long-lived assets primarily consist of property and equipment and right-of-use assets from leases. These assets are reviewed for potential impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable In June 2025, the Company initiated a cost-reduction plan that included the termination of its partnership with Best Buy. As part of this plan, the Company intends to wind down its Best Buy shop-in-shop locations (the “Exit”), with closures and related workforce reductions expected to be substantially completed by the third quarter of fiscal 2026. As a result of the Exit, the Company assessed the recoverability of long-lived assets associated with the affected locations. For the thirteen and twenty-six weeks ended August 3, 2025, the Company recorded an impairment charge of $1.5 million related to property and equipment at the shop-in-shop locations. The impairment was determined by comparing the carrying amount of the assets to the estimated undiscounted future cash flows. As the carrying amounts were not recoverable, the assets were written down to their estimated fair values, which were determined using a discounted cash flow model based on historical performance and expected future profitability. These impairment charges are included within selling, general and administrative expense in the Statements of Operations. As part of the Exit, the Company incurred severance and other one-time employee termination benefits, as well as costs associated with decommissioning the Best Buy shop-in-shop locations. These costs did not have a material impact on the financial statements
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