IEEPA TARIFF REFUND	6 Months Ended
Jul. 31, 2026
IEEPA TARIFF REFUND
IEEPA TARIFF REFUND	NOTE 12 – IEEPA TARIFF REFUND In February 2026, the Supreme Court of the United States ruled against the current administration’s use of the International Emergency Economic Powers Act (“IEEPA”) to impose certain tariffs levied since February 2025. Pursuant to a court order on March 4, 2026 from the U.S. Court of International Trade (“CIT”) directing the refund of such tariffs, including applicable interest, on April 20, 2026, U.S. Customs and Border Protection (“CBP”) launched the Consolidated Administration and Processing of Entries (“CAPE”) system to facilitate refund claims, to which the Company successfully submitted its refund claim. In April 2026, the Company assessed that the recovery of previously paid IEEPA tariffs was probable and reasonably estimable in accordance with the cost recovery accounting guidance, based on the Supreme Court ruling, the CIT order and actions taken by CBP regarding the refund process and other available information, including offers from third-party financial institutions to acquire the Company’s tariff refund claim. Accordingly, during the first quarter of fiscal 2027, the Company recorded a receivable of approximately $139.5 million related to IEEPA tariffs paid by the Company between February 2025 and February 2026, which was included within prepaid expenses and other current assets on the Company’s condensed consolidated balance sheets. The accounting for the IEEPA tariff refund reflects the original treatment of the underlying tariff costs. During the six months ended July 31, 2026, the Company recognized a $126.4 million reduction in cost of goods sold in the Company’s condensed consolidated statements of income, representing the expense for IEEPA tariffs on inventory sold to customers since the tariffs were enacted in February 2025. Additionally, the Company recognized a $13.6 million reduction in the carrying value of its inventories on hand on the Company’s condensed consolidated balance sheet as of July 31, 2026 for tariffs previously capitalized as cost of inventory. Interest associated with refunded IEEPA tariffs is recognized in the Company’s condensed consolidated statements of income in the period it is received. During the second quarter of fiscal 2027, the Company received approximately $129.7 million in tariff refunds and $4.2 million in statutory interest from the U.S. Department of Treasury related to its Phase 1 IEEPA tariff claim. The receipt of the principal reduced the previously recognized tariff refund receivable. The interest was recognized within interest and financing charges, net in the Company’s condensed consolidated statements of income and comprehensive income. As of July 31, 2026, the Company has a tariff refund receivable remaining of approximately $9.8 million which is expected to be processed as part of CBP's Phase 2 refund process. The timing of cash receipts for the remaining tariff refund claim remains dependent upon the processing of refund claims by CBP and the U.S. Department of Treasury.

IEEPA TARIFF REFUND

6 Months Ended

Jul. 31, 2026

NOTE 12 – IEEPA TARIFF REFUND

In February 2026, the Supreme Court of the United States ruled against the current administration’s use of the International Emergency Economic Powers Act (“IEEPA”) to impose certain tariffs levied since February 2025. Pursuant to a court order on March 4, 2026 from the U.S. Court of International Trade (“CIT”) directing the refund of such tariffs, including applicable interest, on April 20, 2026, U.S. Customs and Border Protection (“CBP”) launched the Consolidated

Administration and Processing of Entries (“CAPE”) system to facilitate refund claims, to which the Company successfully submitted its refund claim.

In April 2026, the Company assessed that the recovery of previously paid IEEPA tariffs was probable and reasonably estimable in accordance with the cost recovery accounting guidance, based on the Supreme Court ruling, the CIT order and actions taken by CBP regarding the refund process and other available information, including offers from third-party financial institutions to acquire the Company’s tariff refund claim. Accordingly, during the first quarter of fiscal 2027, the Company recorded a receivable of approximately $139.5 million related to IEEPA tariffs paid by the Company between February 2025 and February 2026, which was included within prepaid expenses and other current assets on the Company’s condensed consolidated balance sheets.

The accounting for the IEEPA tariff refund reflects the original treatment of the underlying tariff costs. During the six months ended July 31, 2026, the Company recognized a $126.4 million reduction in cost of goods sold in the Company’s condensed consolidated statements of income, representing the expense for IEEPA tariffs on inventory sold to customers since the tariffs were enacted in February 2025. Additionally, the Company recognized a $13.6 million reduction in the carrying value of its inventories on hand on the Company’s condensed consolidated balance sheet as of July 31, 2026 for tariffs previously capitalized as cost of inventory. Interest associated with refunded IEEPA tariffs is recognized in the Company’s condensed consolidated statements of income in the period it is received.

During the second quarter of fiscal 2027, the Company received approximately $129.7 million in tariff refunds and $4.2 million in statutory interest from the U.S. Department of Treasury related to its Phase 1 IEEPA tariff claim. The receipt of the principal reduced the previously recognized tariff refund receivable. The interest was recognized within interest and financing charges, net in the Company’s condensed consolidated statements of income and comprehensive income. As of July 31, 2026, the Company has a tariff refund receivable remaining of approximately $9.8 million which is expected to be processed as part of CBP's Phase 2 refund process.

The timing of cash receipts for the remaining tariff refund claim remains dependent upon the processing of refund claims by CBP and the U.S. Department of Treasury.