v3.26.1
Fair Value
 3 Months Ended
May 03, 2026
Fair Value [Abstract]  
Fair Value

5. FAIR VALUE

ASC Topic 820, Fair Value Measurements and Disclosures (“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 (i.e., an exit price). The exit price is based on the amount that the holder of the asset or liability would receive or need to pay in an actual transaction (or in a hypothetical transaction if an actual transaction does not exist) at the measurement date. ASC 820 describes a fair value hierarchy based on three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last unobservable, as follows:

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

Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s assets and liabilities measured at fair value are categorized as Level 3 instruments. The fair value of the Company’s available-for-sale security was valued based on a discounted cash flow method (Level 3), which incorporates the U.S. Treasury yield curve, credit information and an estimate of future cash flows. During the three months ended May 3, 2026, certain changes in the inputs did impact the fair value of the available-for-sale security. The calculated fair value is based on estimates that are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

The amortized cost and fair value of the Company’s available-for-sale security and the corresponding amount of gross unrealized gains and losses recognized in accumulated other comprehensive income are as follows:

 

 

 

May 3, 2026

 

 

 

Cost or

 

 

Gross

 

 

Gross

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Estimated

 

 

 

Cost

 

 

Gains

 

 

Losses

 

 

Fair Value

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Level 3 security:

 

 

 

 

 

 

 

 

 

 

 

 

Corporate trust

 

$

5,079

 

 

$

—

 

 

$

(403

)

 

$

4,676

 

 

 

 

February 1, 2026

 

 

 

Cost or

 

 

Gross

 

 

Gross

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Estimated

 

 

 

Cost

 

 

Gains

 

 

Losses

 

 

Fair Value

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

Level 1 security:

 

 

 

 

 

 

 

 

 

 

 

 

Money market funds

 

$

12,158

 

 

$

—

 

 

$

—

 

 

$

12,158

 

Level 3 security:

 

 

 

 

 

 

 

 

 

 

 

 

Corporate trust

 

$

5,137

 

 

$

—

 

 

$

(374

)

 

$

4,763

 

 

The following table presents a reconciliation of the beginning and ending balances of the Company's corporate trust security measured at fair value on a recurring basis using significant unobservable inputs (Level 3):

 

 

 

Three Months Ended

 

 

 

May 3, 2026

 

 

May 4, 2025

 

(in thousands)

 

 

 

 

 

 

Corporate trust - (Level 3)

 

 

 

 

 

 

Beginning balance

 

$

4,763

 

 

$

4,491

 

Total gains (losses) included in OCI (Change in value)

 

 

(29

)

 

 

421

 

Settlements

 

 

(58

)

 

 

(52

)

Ending balance

 

$

4,676

 

 

$

4,860

 

 

Significant Unobservable Inputs

 

May 3, 2026

 

 

February 1, 2026

 

Weighted Average Discount Rate

 

 

4.56

%

 

 

4.43

%

Own credit risk

 

 

1.50

%

 

 

1.50

%

Future Cash Flows (in thousands)

 

$

6,908

 

 

$

7,030

 

 

The Company does not intend to sell the available-for-sale-security in the near term and does not believe that it will be required to sell the security. The Company reviews its securities on a quarterly basis to monitor its exposure to other-than-temporary impairment.

No other-than-temporary impairment was recorded in the unaudited condensed consolidated statements of operations for the three months ended May 3, 2026 or May 4, 2025.

The following table presents future principal receipts related to the Company’s available-for-sale security by contractual maturity as of May 3, 2026.

 

 

 

Amortized

 

 

Estimated

 

 

 

Cost

 

 

Fair Value

 

(in thousands)

 

 

 

 

 

 

Within one year

 

$

246

 

 

$

214

 

After one year through five years

 

 

1,596

 

 

 

1,434

 

After five years through ten years

 

 

2,351

 

 

 

2,190

 

After ten years

 

 

886

 

 

 

838

 

Total

 

$

5,079

 

 

$

4,676

 

 

The carrying values and fair values of other financial instruments in the Consolidated Balance Sheets are as follows:

 

 

 

May 3, 2026

 

 

February 1, 2026

 

 

 

Carrying Amount

 

 

Fair Value

 

 

Carrying Amount

 

 

Fair Value

 

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

TRI Long-term debt, including short-term portion

 

$

24,128

 

 

$

22,381

 

 

$

24,357

 

 

$

22,810

 

 

The above long-term debt, including short-term portion is attributable to the consolidation of TRI in accordance with ASC Topic 810, Consolidation. The fair value was also based on a discounted cash flow method (Level 3) based on credit information and an estimate of future cash flows.