During the first quarter of Fiscal 2026, the Company announced its new corporate strategy, Grow Brand Love. In connection with this strategic transformation, the Company reorganized its brand structure and certain functional areas primarily within its North America reportable segment, and the Company is optimizing its store fleet by exiting underperforming stores and repositioning stores from declining venues (the “Plan”). As a result of the Plan, the Company expects to incur restructuring and related costs, primarily consisting of severance and other employee-related costs, contract termination costs, and store closure costs, including inventory write-downs, asset disposals and asset impairment charges.

Restructuring and related charges of $1.8 million and $9.3 million were recognized during the 13 and 26 weeks ended August 1, 2026, respectively, and $2.8 million and $21.8 million was recognized during the 13 and 26 weeks ended August 2, 2025, respectively. Charges primarily related to severance and other employee-related costs, as well as store closure costs. The Company had accrued restructuring charges related to the Plan of $4.3 million as of August 1, 2026 (January 31, 2026 and August 2, 2025: $10.2 million and $14.5 million, respectively), primarily for severance, which are included in accrued expenses and other current liabilities in the condensed consolidated balance sheets.

The following table summarizes the restructuring and related charges incurred for the Plan, which are recorded within other operating expense, net in the condensed consolidated statements of operations for the 13 and 26 weeks ended August 1, 2026 and August 2, 2025, as well as the cumulative amount incurred under the Plan through August 1, 2026:


	13 weeks ended				26 weeks ended				Cumulative amount
(in millions)	August 1, 2026		August 2, 2025		August 1, 2026		August 2, 2025		August 1, 2026
Employee-related costs	$	0.9	$	1.4	$	3.6	$	19.6	$	26.3
Store closure and other costs	0.9		1.4		5.7		2.2		9.5

Total Plan expenses	$	1.8	$	2.8	$	9.3	$	21.8	$	35.8


(in millions)	Employee-related costs		Store closure and other costs		Total
Balance at January 31, 2026	$	10.2	$	—	$	10.2
Payments and other adjustments	(9.5)		(5.7)		(15.2)
Charged to expense	3.6		5.7		9.3
Balance at August 1, 2026	$	4.3	$	—	$	4.3

In addition to the charges described above, the Company recognized a $1.4 million credit and $31.3 million of charges for inventory write-downs during the 13 and 26 weeks ended August 1, 2026, respectively. These charges are associated with the disposal of inventory in connection with the discontinuance of James Allen and Rocksbox as separately operated brands and the decommissioning of their respective websites as these brands are transitioned to collections within remaining brands as part of the initiatives under the Plan. These charges are recorded within cost of sales in the condensed consolidated statements of operations. The Company also incurred asset impairment charges of $0.3 million and $1.8 million during the 13 and 26 weeks ended August 1, 2026, respectively, and $10.2 million and $13.4 million during the 13 and 26 weeks ended August 2, 2025, respectively, as a result of the Plan. These charges were incurred primarily for store assets and cloud computing arrangements, which are recorded within asset impairments, net in the condensed consolidated statements of operations. The cumulative amount of asset impairment charges incurred under the Plan totaled $18.5 million as of August 1, 2026.

Total estimated costs related to the Plan are expected to range from approximately $90 million to $100 million, including approximately $55 million to $60 million of estimated non-cash charges primarily for inventory write-downs, asset disposals and impairments. The Company expects the Plan will be substantially completed by the end of Fiscal 2027.