v3.26.1
Fair Value Measurements
 3 Months Ended
May 02, 2026
Fair Value Disclosures [Abstract]  
Fair Value Measurements

6. Fair Value Measurements

The Company accounts for fair value measurements in accordance with ASC 820, which defines fair value, establishes a framework for measurement and expands disclosure about fair value measurements. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price), and classifies the inputs used to measure fair value into the following hierarchy:

Level 1: Quoted prices for identical assets or liabilities in active markets.

Level 2: Quoted market prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable.

Level 3: Pricing inputs that are unobservable for the assets and liabilities and include situations where there is little, if any, market activity for the assets and liabilities.

The inputs into the determination of fair value require significant management judgment or estimation.

The carrying amounts of cash equivalents, accounts receivable and accounts payable approximate fair value due to the short-term nature of these instruments.

Refer to Note 5, “Derivative Instruments and Hedging Activities,” for further discussion regarding the fair value of the Company’s interest rate swap contracts.

Financial Assets

The fair values of the Company’s financial assets and the hierarchy of the level of inputs as of May 2, 2026, January 31, 2026 and May 3, 2025 are summarized below:

 

 

(in thousands)

 

 

 

Fair Value Measurements at

 

 

 

May 2,

 

 

January 31,

 

 

May 3,

 

 

 

2026

 

 

2026

 

 

2025

 

Level 1

 

 

 

 

 

 

 

 

 

Cash equivalents

 

$

268,441

 

 

$

746,996

 

 

$

348

 

Long-lived assets are measured at fair value on a non-recurring basis for purposes of calculating impairment using the fair value hierarchy of ASC 820. The fair value of the Company’s long-lived assets is calculated using a discounted cash-flow model that uses level 3 inputs. In calculating future cash flows, the Company makes estimates regarding future operating results and market rent rates, based on its experience and knowledge of market factors in which the retail location is located.

Impairment charges on long-lived assets were $0.8 million during the first quarter of Fiscal 2026, primarily related to impairment of assets held-for-sale at one store as well as unrecoverable assets at underperforming stores. Impairment charges on long-lived assets were $0.5 million during the first quarter of Fiscal 2025, related to unrecoverable assets at underperforming stores and relocating stores, as well as lease asset impairment charges related to one of those stores.

During the three months ended May 2, 2026 and the three month period ended May 3, 2025, the assets impaired had a remaining carrying value after impairments of $20.8 million and $15.0 million, respectively.

 

Financial Liabilities

The fair values of the Company’s financial liabilities are summarized below:

 

 

(in thousands)

 

 

 

May 2, 2026

 

 

January 31, 2026

 

 

May 3, 2025

 

 

 

Principal
Amount

 

 

Fair
Value

 

 

Principal
Amount

 

 

Fair
Value

 

 

Principal
Amount

 

 

Fair
Value

 

Term Loan Facility

 

$

1,726,225

 

 

$

1,728,383

 

 

$

1,730,606

 

 

$

1,730,606

 

 

$

1,243,750

 

 

$

1,228,203

 

2027 Convertible Notes

 

 

186,071

 

 

 

299,113

 

 

 

297,069

 

 

 

451,205

 

 

 

297,069

 

 

 

390,199

 

ABL Line of Credit (a)

 

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

 

 

100,000

 

 

 

100,000

 

Total debt (b)

 

$

1,912,296

 

 

$

2,027,496

 

 

$

2,027,675

 

 

$

2,181,811

 

 

$

1,640,819

 

 

$

1,718,402

 
(a)
To the extent the Company has any outstanding borrowings under the ABL Line of Credit, the fair value would approximate its reported value, because the interest rate is variable and reflects current market rates, due to its short term nature.
(b)
The table above excludes finance lease obligations, debt discount and deferred debt costs.

The fair values presented herein are based on pertinent information available to management as of the respective period end dates. The estimated fair values of the Company’s debt are classified as Level 2 in the fair value hierarchy, and are based on current market quotes received from inactive markets.