Before joining The Home Depot, Babcock held leadership positions at Cardlytics, MSL GROUP/Publicis Groupe, and Ketchum, where she consistently built high-performing teams and drove significant revenue growth through digital and strategic partnership initiatives. About 1-800-FLOWERS.COM, Inc. For almost 50 years 1-800-FLOWERS.COM, and 1-800-FLOWERS.COM, Inc. has served as the premier destination for meaningful gifting, helping people express and connect through thoughtful giving. As an omnichannel retailer, ...

Core Insights - Seasonal hiring in the retail industry is expected to decline significantly, with projections indicating the addition of under 500,000 positions in Q4 2025, marking the smallest seasonal gain in 16 years and an 8% decrease from the previous year [2][4] Group 1: Hiring Trends - Retailers are facing multiple challenges including tariffs, inflation, and a shift towards automation, which is leading to fewer seasonal hires [3][4] - Major retailers like Target have not disclosed their seasonal hiring plans yet, contrasting with last year when they announced specific hiring numbers [5][6] - Companies such as Spirit Halloween and Bath & Body Works have released their hiring plans, with Spirit planning to hire 50,000 and Bath & Body Works planning to hire 32,000 workers [7][8] Group 2: Economic Indicators - The overall job market has shown signs of slowing, with nonfarm payrolls increasing by only 22,000 in August, significantly below expectations [9][10] - Consumers are under financial pressure due to persistent inflation and high interest rates, which may dampen demand during the holiday season [11] - Reports indicate that consumers plan to spend 5% less on holiday gifts and related expenses this year, marking the first significant drop since 2020 [12]

PART I [Item 1. Business Overview](index=4&type=section&id=Item%201.%20BUSINESS) A leading e-commerce gift provider with diverse brands, focusing on customer relationships, strategic acquisitions, and highly seasonal operations [Company Profile and Brands](index=4&type=section&id=The%20Company) The company operates a leading e-commerce platform with a family of brands, a loyalty program, and B2B services - The Company operates a leading e-commerce platform with a family of brands including **1-800-Flowers.com®**, **Harry & David®**, and **PersonalizationMall.com®**[13](index=13&type=chunk) - The **Celebrations Passport®** loyalty program offers members free standard shipping and no service charge, aiming to deepen customer relationships[13](index=13&type=chunk) - The Company also provides services to the floral and gift industry through **BloomNet®** and other brands[13](index=13&type=chunk) [Business Strategy and Evolution](index=4&type=section&id=Narrative%20Description%20of%20Business) The company aims to be the leading authority in thoughtful gifting, expanding offerings through acquisitions and a sentiment-led customer journey - The Company's objective is to be the leading authority on thoughtful gifting, serving expanding celebratory needs and building trusted relationships[16](index=16&type=chunk) - The strength of the **1-800-FLOWERS.COM®** brand has enabled expansion into complementary products like gourmet popcorn, cookies, and personalized items[17](index=17&type=chunk) - Recent acquisitions include **Things Remembered®** (Jan 2023), **Card Isle** (Apr 2024), and **Scharffen Berger®** (Jul 2024), broadening the product portfolio[17](index=17&type=chunk) - In fiscal 2025, the Company announced a multi-year 'Celebrations strategy' to transform the customer journey into a sentiment-led experience[20](index=20&type=chunk) [Business Segments and Offerings](index=6&type=section&id=CONSUMER%20FLORAL%20%26%20GIFTS%20SEGMENT) The company operates in Consumer Floral & Gifts, BloomNet, and Gourmet Foods & Gift Baskets segments, offering diverse products and services - The Consumer Floral & Gifts segment provides direct-to-consumer, multi-channel offerings of fresh flowers, plants, fruit and gift basket products, and personalized gifts[23](index=23&type=chunk)[26](index=26&type=chunk) - The BloomNet segment offers products and services to professional florists, including settlement processing, advertising, web hosting, and e-commerce greeting cards via **Card Isle**[23](index=23&type=chunk)[28](index=28&type=chunk) - The Gourmet Foods & Gift Baskets segment includes brands like **Harry & David®**, **Cheryl's Cookies®**, and **Scharffen Berger®**, offering premium fruit, gourmet food, baked goods, and chocolates[24](index=24&type=chunk)[27](index=27&type=chunk) [Marketing and Customer Engagement](index=8&type=section&id=Marketing%20and%20Promotion) The company employs an integrated marketing strategy to strengthen brand equity, acquire customers, and enhance lifetime value through data-driven personalization - The Company's marketing strategy focuses on strengthening brand equity, accelerating customer acquisition, and enhancing customer lifetime value through a comprehensive celebratory ecosystem[29](index=29&type=chunk) - An omnichannel approach leverages digital advertising, traditional media, direct-response marketing, public relations, social media, and strategic partnerships[30](index=30&type=chunk) - Investment in advanced analytics, marketing automation, **AI-driven personalization**, and enhanced mobile commerce capabilities is prioritized to improve targeting[31](index=31&type=chunk) [Technology and Fulfillment](index=9&type=section&id=Technology%20Infrastructure) The company uses advanced technology and a hybrid fulfillment system for seamless shopping, offering various delivery options while optimizing capital investment - The Company's technology infrastructure enables direct order transmission from websites into a proprietary transaction processing system, routing orders via **BloomLink®**[33](index=33&type=chunk) - A hybrid fulfillment system, combining **BloomNet** members, Company distribution centers, and direct-ship vendors, offers same-day, next-day, and any-day delivery options[34](index=34&type=chunk) - Floral orders are mostly fulfilled by **BloomNet** members for immediate delivery, while personalized gifts are manufactured and distributed from Bolingbrook, IL[35](index=35&type=chunk) - Gourmet foods and gift baskets are manufactured in various facilities (e.g., Westerville, OH; Medford, OR) and distributed from shared Company-owned and leased facilities[36](index=36&type=chunk) [Raw Materials and Supply Chain](index=9&type=section&id=Sources%20and%20Availability%20of%20Raw%20Materials) Raw materials for manufactured products, packaging, and transportation are sourced globally, with prices and availability subject to fluctuation and supplier compliance - Raw materials include ingredients for manufactured products (e.g., sugar, flour, cocoa, eggs, fruit, flowers), packaging supplies, and transportation supplies[37](index=37&type=chunk) - Most raw materials are purchased from third parties, some of whom are single-source suppliers, and prices/availability are subject to fluctuation[37](index=37&type=chunk) - The Company utilizes a global supply chain, with suppliers subject to standards of conduct including compliance with local labor and worker safety laws[37](index=37&type=chunk) [Seasonal Business Fluctuations](index=10&type=section&id=Seasonality) The company's business is highly seasonal, with the second fiscal quarter generating over **40%** of annual revenues and all earnings - The Thanksgiving through Christmas holiday season (fiscal Q2) generates over **40%** of annual revenues and all of the Company's earnings[38](index=38&type=chunk) - Revenues also rise during fiscal Q3 and Q4 due to major floral gifting occasions like Mother's Day and Valentine's Day, compared to Q1[38](index=38&type=chunk) Fiscal 2025 Revenue Distribution by Quarter | Quarter | % of Annual Revenues | | :------ | :------------------- | | Q2 | 46% | | Q1 | 14% | | Q3 | 20% | | Q4 | 20% | - Seasonal inventory build, peaking in November, is financed by cash flows from operations and borrowings under the revolving credit facility, typically repaid before the end of Q2[39](index=39&type=chunk) [Competitive Landscape](index=10&type=section&id=Competition) The company operates in highly competitive floral, gift, and gourmet food industries, facing risks of price reductions and market share loss - The Company faces intense competition from established e-commerce businesses, mass merchants, telemarketers, retail specialty shops, online retailers, and mail-order catalogs[40](index=40&type=chunk) - Competitors in the floral industry include retail floral shops, online marketplaces, catalog companies, floral telemarketers, wire services, supermarkets, and specialty retailers[42](index=42&type=chunk) - Increased competition could result in price reductions, decreased revenues, lower profit margins, loss of market share, and increased marketing expenditures[43](index=43&type=chunk) - The Company believes its brand strength, product selection, customer relationships, technology infrastructure, and fulfillment capabilities provide a competitive advantage[41](index=41&type=chunk) [Regulatory Environment](index=11&type=section&id=Government%20Regulation%20and%20Legal%20Uncertainties) The company is subject to evolving e-commerce, consumer protection, and internet-related regulations, increasing compliance costs and operational burdens - The Company is subject to a growing number of evolving local, state, and national laws and regulations, including those applicable to e-commerce[44](index=44&type=chunk) - Legislatures are considering increasing laws and regulations pertaining to the Internet, addressing user privacy, pricing, content, and taxation[49](index=49&type=chunk) - More stringent consumer protection laws could impose additional burdens, decreasing demand and increasing costs of doing business[45](index=45&type=chunk) [Intellectual Property Protection](index=11&type=section&id=Intellectual%20Property) The company considers its intellectual property critical, but faces risks of infringement, misappropriation, and costly litigation to defend its rights - The Company regards its service marks, trademarks, trade secrets, and domain names as critical to its success, holding registrations for brands like **'1-800-FLOWERS.COM'** and **'Harry & David'**[47](index=47&type=chunk) - Protection of proprietary rights in Internet-related industries is uncertain and evolving, with foreign laws potentially offering less protection than in the U.S[48](index=48&type=chunk) - The Company has experienced past infringements and expects them to continue, potentially leading to expensive and time-consuming litigation that could divert management resources[50](index=50&type=chunk)[51](index=51&type=chunk) [Human Capital Management](index=12&type=section&id=Human%20Capital) The company focuses on attracting and retaining talent, with approximately **3,900** employees, emphasizing an inclusive culture, competitive benefits, and workplace safety - As of June 29, 2025, the Company had approximately **3,900** full and part-time employees, all located in the United States, with significant increases during peak periods[52](index=52&type=chunk) - The Company is committed to building an inclusive and equitable culture, offering competitive compensation and benefits, career development, and a respectful environment[53](index=53&type=chunk)[54](index=54&type=chunk) - Workplace safety is a continuous focus, with emphasis on training, awareness, behavioral-based work observation practices, and identifying/addressing safety risks[55](index=55&type=chunk) [Item 1A. Risk Factors](index=13&type=section&id=Item%201A.%20Risk%20Factors) The company faces macroeconomic, supply chain, operational, competitive, technology, cybersecurity, legal, and regulatory risks [Macroeconomic and Global Supply Chain Risks](index=13&type=section&id=Macroeconomic%20Conditions%20and%20Related%20Risk%20Factors) The company is vulnerable to macroeconomic conditions, international vendor dependence, increased shipping costs, and supply chain disruptions impacting consumer spending and product availability - Consumer spending patterns are sensitive to general economic climate, disposable income, debt, and confidence, with adverse changes potentially reducing demand and prices[60](index=60&type=chunk) - Dependence on international vendors for flowers and components exposes the Company to risks including import duties, agricultural limitations, trade restrictions, and political instability[61](index=61&type=chunk)[67](index=67&type=chunk) - Increased shipping costs and supply chain disruptions (e.g., carrier price increases, capacity constraints) can negatively impact sales, customer relationships, revenues, and earnings[63](index=63&type=chunk) - Limited flower supply due to weather, farm closures, or political conditions can cause price increases or unavailability, leading to reduced customer demand and declining revenues/gross margins[64](index=64&type=chunk) [Operational and Competitive Risks](index=15&type=section&id=Business%20and%20Operational%20Risk%20Factors) Operating results fluctuate due to seasonality, competition, and reliance on temporary staff, with risks including brand maintenance failure, inaccurate demand prediction, and impairment charges - Operating results may fluctuate due to seasonality, the retail economy, marketing program timing/effectiveness, new product introductions, supplier reliability, severe weather, and competition[69](index=69&type=chunk) - Failure to develop and maintain brands, or ineffective advertising, could lead to a reduction in customer base and revenues[71](index=71&type=chunk) - If local florists or third-party vendors fail to satisfy customer orders, it could lead to customer dissatisfaction and decreased revenues[75](index=75&type=chunk) - Intense competition in floral, plant, gift basket, gourmet food, and specialty gift industries could result in price reductions, decreased revenue, lower profit margins, and increased marketing expenditures[78](index=78&type=chunk)[80](index=80&type=chunk) - The Company incurred significant non-cash impairment charges for goodwill and intangible assets in fiscal **2025 ($143.8 million)**, fiscal **2024 ($19.8 million)**, and fiscal **2023 ($64.6 million)**, negatively impacting operating results[90](index=90&type=chunk) [Information Technology and Cybersecurity Risks](index=18&type=section&id=Information%20Technology%20and%20Systems) The company relies heavily on its computer systems, facing significant risks from cybersecurity threats, system disruptions, AI integration complexities, and credit card fraud - Failure to protect websites, networks, and computer systems against disruption and cybersecurity threats, or to protect confidential customer information, could damage relationships and harm reputation[91](index=91&type=chunk) - Systems increasingly incorporate **AI features**, which are complex, subject to scrutiny, and may produce errors, infringe rights, or not align with business goals, leading to legal liability or reputational harm[94](index=94&type=chunk) - An increase in remote employees amplifies cybersecurity risks, including phishing attacks and securing more endpoints like laptops and mobile devices[96](index=96&type=chunk) - Significant credit card, debit card, and gift card fraud could decrease revenues, lead to charge-backs, or cause the Company to lose the ability to accept these payment forms[98](index=98&type=chunk) - Unexpected system interruptions, long response times, or service degradation, especially during peak holiday periods, could result in reduced revenues and harm the Company's brand[99](index=99&type=chunk)[101](index=101&type=chunk) [Legal, Regulatory, and Financial Risks](index=20&type=section&id=Legal%2C%20Regulatory%2C%20Tax%20and%20Other%20Risks) The company faces risks from intellectual property infringement, product liability claims, evolving government regulations, and stock price volatility - Unauthorized use of the Company's intellectual property by third parties may damage its brands and reputation, potentially leading to a loss of customers[103](index=103&type=chunk) - If third parties acquire rights to similar domain names or phone numbers, or if the Company loses its right to use its phone numbers (e.g., **1-800-FLOWERS**), its brands could be damaged and sales lost[105](index=105&type=chunk)[106](index=106&type=chunk) - Product liability claims, particularly for perishable food and alcoholic beverage products, could subject the Company to increased costs and negative publicity[108](index=108&type=chunk) - A privacy or data security breach could expose the Company to costly government enforcement actions, private litigation, and adverse effects on its business and reputation[110](index=110&type=chunk) - Failure to comply with federal, state, and international laws and regulations relating to privacy, data protection, and consumer protection, or the enactment of new laws, could adversely affect business and financial condition[114](index=114&type=chunk)[115](index=115&type=chunk) - Evolving corporate governance and public disclosure regulations, including increased scrutiny on **ESG matters**, result in higher general and administrative expenses and management time[118](index=118&type=chunk) [Item 1B. Unresolved Staff Comments](index=23&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) No unresolved SEC staff comments were received regarding current or periodic reports preceding fiscal year-end June 29, 2025 - No unresolved written comments from the SEC staff were received regarding current or periodic reports issued **180 days** or more preceding the fiscal year ended June 29, 2025[120](index=120&type=chunk) [Item 1C. Cybersecurity](index=23&type=section&id=Item%201C.%20Cybersecurity) The company maintains a multifaceted cybersecurity risk management program overseen by the Board, with no material impact to date [Cybersecurity Risk Management and Strategy](index=23&type=section&id=Risk%20Management%20and%20Strategy) The company employs a comprehensive cybersecurity risk management program to protect systems and information, including policies, incident response, and third-party evaluations - The Company has processes to identify, assess, and manage material cybersecurity threat risks as part of its enterprise risk management program[121](index=121&type=chunk) - Strategy includes robust security policies (**PCI-DSS compliant**), an incident response plan, comprehensive system security vulnerability scanning, and a **24/7/365** Security Operation Center[123](index=123&type=chunk) - Periodic third-party evaluations, tabletop exercises, and **PCI-DSS** compliance certifications are conducted to test and validate systems[124](index=124&type=chunk) [Cybersecurity Governance](index=24&type=section&id=Governance) The Board of Directors, through its Technology and Cybersecurity Committee, oversees cybersecurity risk management, led by the Senior Vice President, IT Operations - The Board of Directors, through its Technology and Cybersecurity Committee, oversees the Company's risk management process, including information technology use and protection, data governance, privacy, and cybersecurity[126](index=126&type=chunk)[127](index=127&type=chunk) - The cybersecurity program is led by the Senior Vice President, IT Operations, who reports to the CEO and provides periodic updates to the Board and Committee[128](index=128&type=chunk) - The information security team monitors systems, assesses incident severity, and follows escalation procedures to inform management and the Board[129](index=129&type=chunk) [Item 2. Properties](index=25&type=section&id=Item%202.%20PROPERTIES) The company's material properties include owned and leased offices, plants, warehouses, and orchards across several states Material Properties as of June 29, 2025 | Location | Type | Principal Use | Square Footage / Acres | Ownership | | :---------------- | :----------------------- | :--------------------------------- | :--------------------- | :-------- | | Medford, OR | Office, plant, warehouse | Manufacturing, distribution, admin | 1,112,000 | owned | | Bolingbrook, IL | Office, plant, warehouse | Manufacturing, distribution, admin | 361,176 | leased | | Hebron, OH | Office, plant, warehouse | Manufacturing, distribution, admin | 330,900 | owned | | Medford, OR | Warehouse | Storage | 324,500 | leased | | Obetz, OH | Warehouse | Distribution | 301,176 | leased | | Atlanta, GA | Warehouse | Manufacturing and distribution | 272,821 | leased | | Groveport, OH | Warehouse | Distribution | 255,070 | leased | | Melrose Park, IL | Office and warehouse | Distribution, admin, customer svc | 250,000 | leased | | Jacksonville, FL | Office and warehouse | Distribution and administrative | 180,000 | owned | | Lake Forest, IL | Office, plant, warehouse | Manufacturing, distribution, admin | 148,000 | leased | | Hebron, OH | Warehouse | Storage | 116,000 | leased | | Burr Ridge, IL | Office, plant, warehouse | Manufacturing, distribution, admin | 109,722 | leased | | Jericho, NY | Office | Headquarters | 92,700 | leased | | Westerville, OH | Office, plant, warehouse | Manufacturing, distribution, admin | 88,000 | owned | | Reno, NV | Warehouse | Distribution | 70,000 | leased | | Memphis, TN | Warehouse | Distribution | 70,000 | leased | | Philadelphia, PA | Fulfillment Center | Distribution | 31,000 | leased | | Jackson County, OR| Orchards | Farming | 41 acres | leased | | Jackson County, OR| Orchards | Farming | 1,819 acres | owned | | Jackson County, OR| Land | Fallow land | 1,356 acres | owned | | Josephine County, OR| Orchards | Farming | 91 acres | owned | | Josephine County, OR| Land | Fallow land | 88 acres | owned | [Item 3. Legal Proceedings](index=25&type=section&id=Item%203.%20LEGAL%20PROCEEDINGS) Legal proceedings information is detailed in Note 16 of Part IV, Item 15 of this report - Details regarding legal proceedings are provided in Note 16 in Part IV, Item 15[131](index=131&type=chunk) [Item 4. Mine Safety Disclosures](index=25&type=section&id=Item%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company - Mine Safety Disclosures are not applicable to the Company[132](index=132&type=chunk) PART II [Item 5. Common Equity Market and Stockholder Matters](index=26&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Class A common stock trades on NASDAQ, Class B is not public, with an active repurchase plan and no cash dividends - **1-800-FLOWERS.COM's** Class A common stock trades on The NASDAQ Global Select Market under the ticker symbol **'FLWS'**, with no public trading market for Class B common stock[134](index=134&type=chunk) - Holders of Class A common stock have **one vote** per share, while Class B common stock holders have **10 votes** per share, with Class B convertible to Class A[135](index=135&type=chunk) - As of August 29, 2025, there were approximately **172** stockholders of record for Class A common stock and **14** for Class B common stock[136](index=136&type=chunk) Stock Repurchases Under Program | Fiscal Year Ended | Total Repurchased (USD) | Shares Repurchased | | :---------------- | :---------------------- | :----------------- | | June 29, 2025 | $10.2 million | 1,274,559 | | June 30, 2024 | $10.4 million | 1,079,415 | | July 2, 2023 | $1.2 million | 147,479 | - As of June 29, 2025, **$11.4 million** remains authorized under the stock repurchase plan[137](index=137&type=chunk) - The Company has never declared or paid cash dividends on its common stock and does not anticipate doing so in the foreseeable future[141](index=141&type=chunk) [Item 6. Reserved](index=28&type=section&id=Item%206.%20Reserved) This item is reserved and contains no information [Item 7. Management's Discussion and Analysis (MD&A)](index=28&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Fiscal 2025 saw decreased revenues, net loss, and significant impairment charges, with fiscal 2026 focusing on cost savings and growth [Business Overview](index=28&type=section&id=Business%20Overview) The company is a leading provider of gifts, aiming to inspire customer connections and relationships - The Company is a leading provider of gifts designed to help inspire customers to give more, connect more, and build more and better relationships[143](index=143&type=chunk) [Business Segments](index=28&type=section&id=Business%20Segments) The company operates in three segments: Consumer Floral & Gifts, Gourmet Foods & Gift Baskets, and BloomNet - The Company operates in three business segments: Consumer Floral & Gifts, Gourmet Foods & Gift Baskets, and BloomNet[144](index=144&type=chunk) - Consumer Floral & Gifts includes **1-800-Flowers.com**, **Personalization Mall**, **Things Remembered**, **FruitBouquets.com**, **Flowerama**, and **Alice's Table**[144](index=144&type=chunk) - Gourmet Foods & Gift Baskets includes **Harry & David**, **Wolferman's Bakery**, **Vital Choice**, **Moose Munch**, **Cheryl's Cookies**, **Mrs. Beasley's**, **The Popcorn Factory**, **DesignPac**, **1-800-Baskets.com**, **Simply Chocolate**, **Shari's Berries**, and **Scharffen Berger**[144](index=144&type=chunk) - BloomNet includes **BloomNet**, **Napco**, and **Card Isle**[144](index=144&type=chunk) [Fiscal 2025 Performance Summary](index=28&type=section&id=Fiscal%202025%20Results) Fiscal 2025 was challenging, with net revenues decreasing **8.0%** to **$1,685.7 million**, gross margins declining, and a net loss of **$200.0 million** - Net revenues decreased by **$145.8 million**, or **8.0%**, to **$1,685.7 million** in fiscal 2025 compared to fiscal 2024, primarily due to slowing demand and a highly promotional consumer environment[146](index=146&type=chunk) - Gross margins declined to **38.7%** in fiscal 2025, a **140-basis point** decrease over fiscal 2024, mainly due to higher cost of merchandise and deleveraging of fixed costs[147](index=147&type=chunk) Fiscal 2025 Key Financials (in millions) | Metric | FY2025 | FY2024 | | :-------------- | :------ | :------ | | Net Revenues | $1,685.7| $1,831.4| | Net Loss | $(200.0)| $(6.1) | | Adjusted EBITDA | $29.2 | $93.1 | [Goodwill and Intangible Asset Impairment](index=28&type=section&id=Goodwill%20and%20Intangible%20Asset%20Impairment) The company recorded significant non-cash impairment charges in recent fiscal years, including **$143.8 million** in fiscal 2025 for Consumer Floral & Gifts - In fiscal 2025, a non-cash goodwill and intangible impairment charge of **$143.8 million** was recorded for the Consumer Floral & Gifts reporting unit, including **$113.4 million** for goodwill and **$24.8 million** for the Personalization Mall tradename[149](index=149&type=chunk) - In fiscal 2024, a non-cash impairment charge of **$19.8 million** was recorded for the Personalization Mall tradename due to declining revenue and a higher discount rate[150](index=150&type=chunk) - In fiscal 2023, a non-cash impairment charge of **$64.6 million** was recorded for the Gourmet Foods & Gift Baskets reporting unit, fully impairing goodwill (**$62.3 million**) and partially impairing certain tradenames (**$2.3 million**)[151](index=151&type=chunk) [Acquisition of Scharffen Berger](index=29&type=section&id=Acquisition%20of%20Scharffen%20Berger) On July 1, 2024, the company acquired **Scharffen Berger®** for **$3.3 million**, expanding its gourmet chocolate offerings - On July 1, 2024, the Company acquired certain assets of **Scharffen Berger®**, a chocolate manufacturing company, for approximately **$3.3 million** in cash[152](index=152&type=chunk) - The acquisition expanded the Company's product offerings in the Gourmet Foods & Gift Baskets segment[152](index=152&type=chunk) - **Scharffen Berger's** annual revenues and results of operations were deemed immaterial to the Company's consolidated financial statements[152](index=152&type=chunk) [Acquisition of Card Isle](index=29&type=section&id=Acquisition%20of%20Card%20Isle) On April 3, 2024, the company acquired **Card Isle** for **$3.6 million**, expanding its e-commerce greeting card presence - On April 3, 2024, the Company acquired certain assets of **Card Isle**, an e-commerce greeting card company, for **$3.6 million** in cash[153](index=153&type=chunk) - The acquisition expanded the Company's presence in the greeting card category across all brands within the BloomNet segment[153](index=153&type=chunk) - **Card Isle's** annual revenues and results of operations were deemed immaterial to the Company's consolidated financial statements[153](index=153&type=chunk) [Acquisition of Things Remembered](index=29&type=section&id=Acquisition%20of%20Things%20Remembered) On January 10, 2023, the company acquired **Things Remembered®** for **$5.0 million**, integrating personalized gifts into **PersonalizationMall.com®** - On January 10, 2023, the Company acquired certain assets of the **Things Remembered®** brand, a personalized gifts provider, for **$5.0 million** in cash[154](index=154&type=chunk) - The operations of **Things Remembered** have been integrated within the **PersonalizationMall.com®** brand in the Consumer Floral & Gifts segment[154](index=154&type=chunk) - **Things Remembered's** annual e-commerce revenues were **$30.4 million** for the twelve months ended November 30, 2022[154](index=154&type=chunk) [Fiscal 2026 Strategic Priorities](index=29&type=section&id=Fiscal%202026) Fiscal 2026 focuses on transforming the company into a customer-centric, data-driven organization, driving cost savings, and expanding into new channels - Fiscal 2026 is a pivotal period focused on transforming the Company into a customer-centric, data-driven organization to support its multi-year Celebrations strategy and fuel future growth[155](index=155&type=chunk) - Strategic priorities include driving cost savings and organizational efficiency, building a customer-centric and data-driven organization, broadening reach into new channels, and strengthening the team[155](index=155&type=chunk) [Non-GAAP Financial Measures](index=30&type=section&id=Definitions%20of%20non-GAAP%20financial%20measures%3A) The company uses non-GAAP measures like EBITDA, Adjusted EBITDA, Adjusted Net Income, and Free Cash Flow to provide supplemental insights into performance and liquidity - EBITDA is defined as net income (loss) before interest, taxes, depreciation, and amortization; Adjusted EBITDA further adjusts for stock-based compensation and other comparability items[158](index=158&type=chunk) - Adjusted Net Income (Loss) and Adjusted Net Income (Loss) per common share are net income (loss) and EPS adjusted for certain items affecting period-to-period comparability[163](index=163&type=chunk) - Segment contribution margin is earnings before interest, taxes, depreciation, amortization, and corporate overhead allocation, with Adjusted segment contribution margin including further adjustments[166](index=166&type=chunk) - Free Cash Flow is defined as net cash provided by (used in) operating activities, less capital expenditures[171](index=171&type=chunk) Reconciliation of Net Loss to Adjusted EBITDA (non-GAAP) (in thousands) | Metric | FY2025 | FY2024 | | :-------------------------------------------------------- | :------------ | :------------ | | Net loss | $(199,993) | $(6,105) | | Add: Interest expense and other, net | 8,544 | 3,830 | | Add: Depreciation and amortization | 53,618 | 53,752 | | Add: Income tax expense (benefit) | (13,364) | 203 | | **EBITDA** | **$(151,195)**| **$51,680** | | Add: Stock-based compensation | 11,891 | 10,688 | | Add: Compensation charge related to NQDC plan investment appreciation | 5,423 | 6,904 | | Add: System implementation costs | 13,401 | - | | Add: Goodwill and intangible impairment | 143,823 | 19,762 | | Add: Transaction costs | - | 269 | | Add: Restructuring cost/Severance | 5,823 | 2,564 | | Add: Litigation settlement | - | 1,200 | | **Adjusted EBITDA** | **$29,166** | **$93,067** | Reconciliation of Net Loss to Adjusted Net Income (Loss) (non-GAAP) (in thousands) | Metric | FY2025 | FY2024 | | :-------------------------------------------------------- | :------------ | :------------ | | Net loss | $(199,993) | $(6,105) | | Add: System implementation costs | 13,401 | — | | Add: Transaction costs | — | 269 | | Add: Restructuring cost/Severance | 5,823 | 2,564 | | Add: Litigation settlement | — | 1,200 | | Add: Goodwill and intangible impairment | 143,823 | 19,762 | | Deduct: Tax related adjustments | (15,572) | (6,079) | | **Adjusted net income (loss) (non-GAAP)** | **$(52,518)** | **$11,611** | | Basic and diluted net loss per common share | $(3.13) | $(0.09) | | Basic and diluted adjusted net income (loss) per common share (non-GAAP) | $(0.82) | $0.18 | [Results of Operations](index=34&type=section&id=Results%20of%20Operations) Fiscal 2025 saw an **8.0%** decrease in net revenues, declining gross profit, increased technology expenses, and significant impairment charges, resulting in an income tax benefit Net Revenues (in thousands) | Category | FY2025 | % Change (YoY) | FY2024 | % Change (YoY) | FY2023 | | :--------------- | :------------ | :------------- | :------------ | :------------- | :------------ | | E-Commerce | $1,464,445 | -9.3% | $1,614,199 | -7.5% | $1,744,622 | | Other | $221,213 | 1.8% | $217,222 | -20.5% | $273,231 | | **Total Net Revenues** | **$1,685,658**| **-8.0%** | **$1,831,421**| **-9.2%** | **$2,017,853**| - E-commerce revenues decreased **9.3%** in fiscal 2025 due to lower order volumes (**-8.2%**) and slightly lower average order value (**-1.1%**), reflecting macro-economic conditions and inefficient marketing[181](index=181&type=chunk) - Other revenues increased **1.8%** in fiscal 2025, driven by higher wholesale volumes in Gourmet Foods & Gift Baskets, partially offset by lower BloomNet revenues[181](index=181&type=chunk) Gross Profit (in thousands) | Metric | FY2025 | % Change (YoY) | FY2024 | % Change (YoY) | FY2023 | | :--------------- | :------------ | :------------- | :------------ | :------------- | :------------ | | Gross profit | $652,272 | -11.2% | $734,753 | -3.0% | $757,526 | | Gross profit % | 38.7% | -1.4 ppt | 40.1% | +2.6 ppt | 37.5% | - Marketing and sales expense decreased **0.9%** in fiscal 2025 but increased as a percentage of net revenues to **28.5%** (from **26.5%** in FY24) due to increased advertising costs[201](index=201&type=chunk)[203](index=203&type=chunk) - Technology and development expense increased **3.4%** in fiscal 2025 to **$62.3 million**, primarily due to higher development and consulting costs for technology platform enhancements[205](index=205&type=chunk)[206](index=206&type=chunk) - General and administrative expense decreased **1.0%** in fiscal 2025, mainly due to lower labor costs and changes in NQDC investments, partially offset by higher insurance costs[208](index=208&type=chunk)[209](index=209&type=chunk) - Interest income decreased **49.4%** in fiscal 2025 due to lower available cash balances and lower interest rates[215](index=215&type=chunk)[216](index=216&type=chunk) - Interest expense decreased **10.8%** in fiscal 2025 due to a lower outstanding term loan balance and lower interest rates[218](index=218&type=chunk)[219](index=219&type=chunk) - The Company recorded an income tax benefit of **$13.4 million** in fiscal 2025, resulting in an effective tax rate of **6.3%**, primarily due to a valuation allowance on deferred tax assets and non-deductible goodwill impairment charges[221](index=221&type=chunk) [Liquidity and Capital Resources](index=42&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity decreased significantly in fiscal 2025, with negative free cash flow of **$67.8 million** and a substantial drop in cash and equivalents - Principal sources of liquidity are cash on hand, cash flows from operations, and borrowings available under the credit agreement[223](index=223&type=chunk) Working Capital and Cash (in millions) | Metric | June 29, 2025 | June 30, 2024 | | :----------------- | :------------ | :------------ | | Working Capital | $61.3 | $157.9 | | Cash & Equivalents | $46.5 | $159.4 | - Net cash used for operating activities was **$26.4 million** for fiscal 2025, primarily due to uses of cash for working capital (decreases in accounts payable/accrued expenses, increases in trade receivables/prepaid assets)[228](index=228&type=chunk) - Net cash used in investing activities was **$44.5 million**, attributable to capital expenditures for technology/automation and the acquisition of **Scharffen Berger**[228](index=228&type=chunk) - Net cash used in financing activities was **$42.1 million**, primarily for net repayment of bank borrowings (**$30.0 million**, including a **$25.0 million** voluntary prepayment) and treasury stock acquisition (**$10.2 million**)[229](index=229&type=chunk) - Free cash flow was negative **$67.8 million** for fiscal 2025, a decrease of **$124.2 million** from positive **$56.4 million** in fiscal 2024, driven by lower cash flows from operations[230](index=230&type=chunk) - The Company expects to borrow under its revolving credit facility to fund pre-holiday manufacturing and inventory purchases during fiscal 2026 Q1, with repayment expected before the end of Q2[226](index=226&type=chunk) [Critical Accounting Policies and Estimates](index=43&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies relate to goodwill and other intangible assets, requiring significant judgment in fair value estimates and impairment assessments - Critical accounting policies and estimates relate to goodwill and other intangible assets, requiring significant management judgment and assumptions[234](index=234&type=chunk) - Goodwill is subject to annual impairment assessment at the reporting unit level, using qualitative or quantitative tests (income and market approaches) that involve estimates for revenues, margins, growth rates, and discount rates[235](index=235&type=chunk)[236](index=236&type=chunk)[239](index=239&type=chunk) - Indefinite-lived intangible assets (tradenames, trademarks) are tested for impairment at least annually, using the relief-from-royalty method, which requires judgments on estimated cash flows, perpetual growth rates, and royalty/discount rates[244](index=244&type=chunk) - In fiscal 2025, a non-cash goodwill impairment charge of **$119.0 million** was recorded for the Consumer Floral & Gifts reporting unit, and a **$24.8 million** impairment charge for the Personalization Mall tradename, indicating a risk of future impairments[240](index=240&type=chunk)[245](index=245&type=chunk) [Recently Issued Accounting Pronouncements](index=45&type=section&id=Recently%20Issued%20Accounting%20Pronouncements) The company refers to Note 2 in Part IV, Item 15 for details regarding the impact of recently issued accounting standards - Details regarding the impact of recently issued accounting standards on consolidated financial statements are provided in Note 2 in Part IV, Item 15[247](index=247&type=chunk) [Item 7A. Market Risk Disclosures](index=45&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company faces market risk from interest rate changes affecting cash investments and variable-rate long-term debt - The Company is exposed to market risk from interest rate changes, primarily related to its investment of available cash balances and its long-term debt[248](index=248&type=chunk) - Borrowings under the Company's credit facilities bear variable interest rates, exposing it to changes in interest rates[248](index=248&type=chunk) - A **50 basis point** increase in current interest rates would have increased the Company's interest expense by approximately **$1.0 million** during the fiscal year ended June 29, 2025[248](index=248&type=chunk) [Item 8. Financial Statements and Supplementary Data](index=45&type=section&id=Item%208.%20FINANCIAL%20STATEMENTS%20AND%20SUPPLEMENTARY%20DATA) Annual financial statements are included in Part IV, Item 15 of this Annual Report on Form 10-K - Annual Financial Statements are located in Part IV, Item 15 of this Annual Report on Form 10-K[249](index=249&type=chunk) [Item 9. Changes in and Disagreements with Accountants](index=45&type=section&id=Item%209.%20CHANGES%20IN%20AND%20DISAGREEMENTS%20WITH%20ACCOUNTANTS%20ON%20ACCOUNTING%20AND%20FINANCIAL%20DISCLOSURE) This item is not applicable to the company - This item is not applicable[250](index=250&type=chunk) [Item 9A. Controls and Procedures](index=45&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management and auditors concluded disclosure controls and internal control over financial reporting were effective as of June 29, 2025 [Evaluation of Disclosure Controls and Procedures](index=45&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) The company's management, including the CEO and CFO, concluded that its disclosure controls and procedures were effective as of June 29, 2025 - The Company's Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of June 29, 2025[251](index=251&type=chunk) [Management's Report on Internal Control Over Financial Reporting](index=45&type=section&id=Management%27s%20Report%20on%20Internal%20Control%20Over%20Financial%20Reporting) Management concluded that the company's internal control over financial reporting was effective as of June 29, 2025, based on the COSO framework - Management is responsible for establishing and maintaining adequate internal control over financial reporting, designed to provide reasonable assurance regarding reliability[252](index=252&type=chunk) - Based on an assessment using the **COSO (2013)** framework, management concluded that the Company's internal control over financial reporting was effective as of June 29, 2025[255](index=255&type=chunk) [Changes in Internal Control Over Financial Reporting](index=46&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) No material changes in internal control over financial reporting occurred during the three months ended June 29, 2025 - No material change in internal control over financial reporting occurred during the three months ended June 29, 2025[258](index=258&type=chunk) [Report of Independent Registered Public Accounting Firm](index=47&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) BDO USA, P.C. issued an unqualified opinion on the effectiveness of the company's internal control over financial reporting as of June 29, 2025 - BDO USA, P.C. audited and expressed an unqualified opinion on the effectiveness of **1-800-FLOWERS.COM, Inc.'s** internal control over financial reporting as of June 29, 2025[259](index=259&type=chunk) - The audit was conducted in accordance with **PCAOB** standards, obtaining reasonable assurance about whether effective internal control over financial reporting was maintained[262](index=262&type=chunk) [Item 9B. Other Information](index=48&type=section&id=Item%209B.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 trading arrangements during the quarter ended June 29, 2025 - No directors or executive officers adopted or terminated a 'Rule 10b5-1 trading arrangement' or a 'non-rule 10b5-1 trading arrangement' during the three months ended June 29, 2025[265](index=265&type=chunk) [Item 9C. Disclosure Regarding Foreign Jurisdictions That Prevent Inspections](index=48&type=section&id=Item%209C.%20Disclosure%20Regarding%20Foreign%20Jurisdictions%20That%20Prevent%20Inspections) This item is not applicable to the company - This item is not applicable[266](index=266&type=chunk) PART III [Item 10. Directors, Executive Officers and Corporate Governance](index=48&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the 2025 Proxy Statement - Information regarding directors, executive officers, audit committee, and Section 16(a) beneficial ownership reporting compliance is incorporated by reference from the 2025 Annual Meeting of Stockholders Proxy Statement[268](index=268&type=chunk) - The Company maintains a Code of Business Conduct and Ethics, applicable to all directors, officers, and employees, available on its investor relations website[269](index=269&type=chunk) [Item 11. Executive Compensation](index=48&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation information is incorporated by reference from the 2025 Annual Meeting of Stockholders Proxy Statement - Information regarding executive compensation is incorporated by reference from the Company's Definitive Proxy Statement for the 2025 Annual Meeting of Stockholders[270](index=270&type=chunk) [Item 12. Security Ownership and Stockholder Matters](index=48&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Security ownership and stockholder matters information is incorporated by reference from the 2025 Proxy Statement - Information regarding security ownership of certain beneficial owners and management and related stockholder matters is incorporated by reference from the Company's Definitive Proxy Statement for the 2025 Annual Meeting of Stockholders[271](index=271&type=chunk) [Item 13. Certain Relationships and Related Transactions, and Director Independence](index=48&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Related transactions and director independence information is incorporated by reference from the 2025 Proxy Statement - Information regarding certain relationships and related transactions, and director independence, is incorporated by reference from the Company's Definitive Proxy Statement for the 2025 Annual Meeting of Stockholders[272](index=272&type=chunk) [Item 14. Principal Accounting Fees and Services](index=48&type=section&id=Item%2014.%20Principal%20Accounting%20Fees%20and%20Services) Principal accounting fees and services information is incorporated by reference from the 2025 Proxy Statement - Information regarding principal accounting fees and services is incorporated by reference from the Company's Definitive Proxy Statement for the 2025 Annual Meeting of Stockholders[273](index=273&type=chunk) PART IV [Item 15. Exhibits and Financial Statement Schedules](index=49&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section indexes consolidated financial statements, auditor's report, Schedule II, and an extensive list of exhibits - This section includes the Index to Consolidated Financial Statements, comprising the Report of Independent Registered Public Accounting Firm, Consolidated Balance Sheets, Statements of Operations, Stockholders' Equity, and Cash Flows, along with Notes[275](index=275&type=chunk) - Schedule II - Valuation and Qualifying Accounts is also included[276](index=276&type=chunk) - An Index to Exhibits lists various documents, including equity purchase agreements, corporate governance documents, credit agreements, and employment/compensation plans[277](index=277&type=chunk)[278](index=278&type=chunk)[279](index=279&type=chunk) [Item 16. Form 10-K Summary](index=51&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is not applicable to the company - This item is not applicable[281](index=281&type=chunk) [Signatures](index=52&type=section&id=Signatures) The Annual Report on Form 10-K was signed on September 5, 2025, by the CEO and other principal officers and directors - The Annual Report was signed on September 5, 2025, by Adolfo Villagomez (Chief Executive Officer), James Langrock (Senior Vice President, Treasurer and Chief Financial Officer), Priscilla Kasenchak (Senior Vice President, Finance and Chief Accounting Officer), James F. McCann (Executive Chairman), Christopher G. McCann (Director), and other Directors[285](index=285&type=chunk)[286](index=286&type=chunk) [Report of Independent Registered Public Accounting Firm (Financial Statements)](index=55&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) BDO USA, P.C. issued an unqualified opinion on consolidated financial statements, with critical audit matters on tradename and goodwill valuation - BDO USA, P.C. issued an unqualified opinion on the consolidated financial statements of **1-800-FLOWERS.COM, Inc.** for the periods ended June 29, 2025, and June 30, 2024, confirming fair presentation in conformity with U.S. GAAP[288](index=288&type=chunk) - Critical audit matters included the valuation of the indefinite-lived intangible asset – Personalization Mall Tradename, specifically the perpetual growth rate, discount rate, and royalty rate[294](index=294&type=chunk)[296](index=296&type=chunk) - Another critical audit matter was the valuation of goodwill related to the Consumer Floral & Gifts Reporting Unit, focusing on the forecasted revenues, perpetual growth rate, and discount rate[298](index=298&type=chunk)[299](index=299&type=chunk) [Consolidated Balance Sheets](index=57&type=section&id=Consolidated%20Balance%20Sheets) Total assets decreased to **$772.6 million** from **$1,032.6 million**, driven by reduced cash and goodwill impairment, impacting equity Consolidated Balance Sheet Summary (in thousands) | Metric | June 29, 2025 | June 30, 2024 | | :-------------------------- | :------------ | :------------ | | **Assets:** | | | | Cash and cash equivalents | $46,502 | $159,437 | | Total current assets | $282,727 | $385,732 | | Goodwill | $37,625 | $156,537 | | Trademarks with indefinite lives | $86,673 | $111,473 | | Total assets | **$772,617** | **$1,032,648**| | **Liabilities:** | | | | Total current liabilities | $221,386 | $227,819 | | Long-term debt, net | $134,764 | $177,113 | | Total liabilities | **$504,335** | **$566,306** | | **Stockholders' Equity:** | | | | Total stockholders' equity | **$268,282** | **$466,342** | - Goodwill decreased significantly from **$156.5 million** in FY2024 to **$37.6 million** in FY2025, reflecting impairment charges[303](index=303&type=chunk) - Cash and cash equivalents decreased by **$112.9 million** from **$159.4 million** in FY2024 to **$46.5 million** in FY2025[303](index=303&type=chunk) [Consolidated Statements of Operations and Comprehensive Income (Loss)](index=59&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) Fiscal 2025 saw a **$199.99 million** net loss, an **8.0%** revenue decrease to **$1,685.66 million**, and significant impairment charges Consolidated Statements of Operations Summary (in thousands, except per share data) | Metric | FY2025 | FY2024 | FY2023 | | :------------------------------------ | :------------ | :------------ | :------------ | | Net revenues | $1,685,658 | $1,831,421 | $2,017,853 | | Gross profit | $652,272 | $734,753 | $757,526 | | Total operating expenses | $857,085 | $736,825 | $792,537 | | Operating loss | $(204,813) | $(2,072) | $(35,011) | | Loss before income taxes | $(213,357) | $(5,902) | $(46,762) | | Income tax (benefit) expense | $(13,364) | $203 | $(2,060) | | **Net loss** | **$(199,993)**| **$(6,105)** | **$(44,702)** | | Basic net loss per common share | $(3.13) | $(0.09) | $(0.69) | | Diluted net loss per common share | $(3.13) | $(0.09) | $(0.69) | - Goodwill impairment in FY2025 was **$119.02 million**, and intangible impairment was **$24.80 million**, significantly contributing to the operating loss[306](index=306&type=chunk) [Consolidated Statements of Stockholders' Equity](index=60&type=section&id=Consolidated%20Statements%20of%20Stockholders%27%20Equity) Total stockholders' equity decreased to **$268.28 million** from **$466.34 million**, driven by net loss and treasury stock acquisitions Consolidated Stockholders' Equity Summary (in thousands) | Metric | June 29, 2025 | June 30, 2024 | July 2, 2023 | | :------------------------------------ | :------------ | :------------ | :------------ | | Balance at beginning of period | $466,342 | $471,843 | $509,409 | | Net loss | $(199,993) | $(6,105) | $(44,702) | | Stock-based compensation | $11,891 | $10,688 | $8,334 | | Acquisition of Class A treasury stock | $(10,226) | $(10,456) | $(1,239) | | **Balance at end of period** | **$268,282** | **$466,342** | **$471,843** | - The significant decrease in total stockholders' equity in FY2025 was primarily due to the net loss of **$199.99 million**[308](index=308&type=chunk) [Consolidated Statements of Cash Flows](index=61&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Fiscal 2025 saw **$26.36 million** net cash used in operations, **$44.46 million** in investing, and **$42.11 million** in financing activities Consolidated Statements of Cash Flows Summary (in thousands) | Activity | FY2025 | FY2024 | FY2023 | | :-------------------------------------- | :------------ | :------------ | :------------ | | Net cash (used in) provided by operating activities | $(26,363) | $94,999 | $115,351 | | Net cash used in investing activities | $(44,463) | $(42,304) | $(50,829) | | Net cash (used in) provided by financing activities | $(42,109) | $(20,065) | $30,820 | | Net change in cash and cash equivalents | $(112,935) | $32,630 | $95,342 | | Cash and cash equivalents, end of year | $46,502 | $159,437 | $126,807 | - Net cash used in operating activities in FY2025 was primarily due to the net loss and uses of cash for working capital purposes, including decreases in accounts payable and accrued expenses[311](index=311&type=chunk) - Capital expenditures amounted to **$41.46 million** in FY2025, contributing to cash used in investing activities[311](index=311&type=chunk) - Repayment of bank borrowings totaled **$140.0 million** in FY2025, including a **$25.0 million** voluntary prepayment on the term loan[311](index=311&type=chunk) [Notes to Consolidated Financial Statements](index=63&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, financial performance, acquisitions, assets, liabilities, equity, and recent accounting pronouncements [Note 1. Description of Business](index=63&type=section&id=Note%201.%20Description%20of%20Business) **1-800-FLOWERS.COM, Inc.** is a leading gift provider through its e-commerce platform, featuring diverse brands and **BloomNet®** services - The Company is a leading provider of gifts, operating an e-commerce platform with brands such as **1-800-Flowers.com®**, **Harry & David®**, and **PersonalizationMall.com®**[315](index=315&type=chunk) - It also operates **BloomNet®**, an international floral and gift industry service provider, and the **Celebrations Passport®** loyalty program[315](index=315&type=chunk) [Note 2. Significant Accounting Policies](index=63&type=section&id=Note%202.%20Significant%20Accounting%20Policies) This note outlines the company's significant accounting policies, including fiscal year, estimates, asset valuation, revenue recognition, and recently adopted accounting pronouncements - The Company's fiscal year is a **52- or 53-week** period ending on the Sunday nearest to June 30, with fiscal years 2025, 2024, and 2023 each consisting of **52 weeks**[317](index=317&type=chunk) - Goodwill and other intangible assets are subject to annual impairment assessments, with fair value estimations involving significant management estimates and assumptions[323](index=323&type=chunk)[334](index=334&type=chunk) - Revenue is recognized when control of merchandise or services is transferred to the customer, reduced by discounts, returns, and credits, across e-commerce, retail, wholesale, and **BloomNet** services[346](index=346&type=chunk)[347](index=347&type=chunk)[351](index=351&type=chunk) - The Company adopted **ASU 2023-07**, Segment Reporting, in the fourth quarter of fiscal 2025, requiring enhanced disclosures about significant segment expenses[361](index=361&type=chunk) - The Company is evaluating the impact of **ASU 2023-09** (Income Tax Disclosures) and **ASU 2024-03** (Expense Disaggregation Disclosures), effective for fiscal years beginning after December 15, 2024, and December 15, 2026, respectively[362](index=362&type=chunk)[363](index=363&type=chunk) [Note 3. Net Loss Per Common Share](index=70&type=section&id=Note%203.%20Net%20Loss%20Per%20Common%20Share) For fiscal years 2025, 2024, and 2023, the company reported net losses, resulting in anti-dilutive common stock equivalents excluded from diluted EPS Net Loss Per Common Share (in thousands, except per share data) | Metric | FY2025 | FY2024 | FY2023 | | :------------------------------------ | :------------ | :------------ | :------------ | | Net loss | $(199,993) | $(6,105) | $(44,702) | | Weighted average shares outstanding | 63,807 | 64,586 | 64,688 | | Basic net loss per common share | $(3.13) | $(0.09) | $(0.69) | | Diluted net loss per common share | $(3.13) | $(0.09) | $(0.69) | - Due to net losses, common stock equivalents (stock options and unvested restricted stock awards) were excluded from diluted net loss per share calculations as their inclusion would be anti-dilutive[364](index=364&type=chunk) [Note 4. Acquisitions](index=70&type=section&id=Note%204.%20Acquisitions) The company completed several acquisitions, including **Scharffen Berger®** (**$3.3 million**), **Card Isle** (**$3.6 million**), and **Things Remembered®** (**$5.0 million**), expanding product offerings - On July 1, 2024, the Company acquired certain assets of **Scharffen Berger®**, a chocolate manufacturer, for **$3.3 million**, expanding the Gourmet Foods & Gift Baskets segment[365](index=365&type=chunk)[366](index=366&type=chunk) - On April 3, 2024, the Company acquired certain assets of **Card Isle**, an e-commerce greeting card company, for **$3.6 million**, expanding its greeting card category within the BloomNet segment[368](index=368&type=chunk)[369](index=369&type=chunk) - On January 10, 2023, the Company acquired certain assets of the **Things Remembered®** brand for **$5.0 million**, integrating personalized gifts into the **PersonalizationMall.com®** brand[371](index=371&type=chunk)[372](index=372&type=chunk) - **Scharffen Berger** and **Card Isle** acquisitions were deemed immaterial to consolidated financial statements, while **Things Remembered's** e-commerce revenues were **$30.4 million** for the twelve months prior to acquisition[367](index=367&type=chunk)[370](index=370&type=chunk)[371](index=371&type=chunk)[373](index=373&type=chunk) [Note 5. Inventory](index=71&type=section&id=Note%205.%20Inventory) As of June 29, 2025, total inventory was **$177.13 million**, valued at the lower of cost or net realizable value using a standard costing methodology Inventory Composition (in thousands) | Category | June 29, 2025 | June 30, 2024 | | :-------------- | :------------ | :------------ | | Finished goods | $99,703 | $94,590 | | Work-in-process | $19,256 | $25,849 | | Raw materials | $58,168 | $56,152 | | **Total inventory** | **$177,127** | **$176,591** | - Inventories are valued at the lower of cost or net realizable value, using a standard costing methodology that approximates cost on a first-in, first-out basis[320](index=320&type=chunk) [Note 6. Property, Plant and Equipment, Net](index=71&type=section&id=Note%206.%20Property%2C%20Plant%20and%20Equipment%2C%20Net) Net property, plant and equipment totaled **$215.60 million** as of June 29, 2025, with depreciation expense of **$51.6 million** for fiscal 2025 Property, Plant and Equipment, Net (in thousands) | Category | June 29, 2025 | June 30, 2024 | | :-------------------------------------- | :------------ | :------------ | | Land | $33,811 | $33,827 | | Orchards in production and land improvements | $21,539 | $20,604 | | Building and building improvements | $70,479 | $69,089 | | Leasehold improvements | $31,866 | $31,289 | | Production equipment | $135,213 | $131,664 | | Furniture and fixtures | $9,517 | $9,325 | | Computer and telecommunication equipment | $41,378 | $42,159 | | Software | $208,960 | $176,160 | | Capital projects in progress | $13,313 | $23,172 | | Property, plant and equipment, gross | $566,076 | $537,289 | | Accumulated depreciation and amortization | $(350,480) | $(313,500) | | **Property, plant and equipment, net** | **$215,596** | **$223,789** | - Depreciation expense for the years ended June 29, 2025, June 30, 2024, and July 2, 2023, was **$51.6 million**, **$49.3 million**, and **$49.5 million**, respectively[376](index=376&type=chunk) [Note 7. Goodwill and Other Intangibles, Net](index=73&type=section&id=Note%207.%20Goodwill%20and%20Other%20Intangibles%2C%20Net) Goodwill decreased significantly to **$37.63 million** due to a **$119.02 million** impairment charge, with total identifiable intangibles at **$89.36 million** Goodwill by Segment (in thousands) | Segment | June 29, 2025 | June 30, 2024 | | :-------------------------- | :------------ | :------------ | | Consumer Floral & Gifts | $34,554 | $153,577 | | BloomNet | $2,960 | $2,960 | | Gourmet Foods & Gift Baskets| $111 | $0 | | **Total Goodwill** | **$37,625** | **$156,537** | - In fiscal 2025, a non-cash goodwill impairment charge of **$119.02 million** was recorded for the Consumer Floral & Gifts reporting unit[377](index=377&type=chunk) Other Intangible Assets, Net (in thousands) | Category | June 29, 2025 | June 30, 2024 | | :-------------------------------------- | :------------ | :------------ | | Intangible assets with determinable lives | $2,691 | $4,743 | | Trademarks with indefinite lives | $86,673 | $111,473 | | **Total identifiable intangible assets**| **$89,364** | **$116,216** | - A non-cash impairment charge of **$24.8 million** was recorded for the Perso

Company Overview - 1-800-Flowers.com, Inc. (NASDAQ:FLWS) is a key player in the floral and gourmet food retail sector, operating within the Zacks Retail - Mail Order industry [1] Earnings Report - For the quarter ending September 4, 2025, the company reported an earnings per share (EPS) of -$0.82, which was below the estimated EPS of -$0.51 [1][5] - The company generated revenue of $336.6 million, exceeding the estimated $330 million, but this represents a decline from $360.91 million reported in the same quarter the previous year [2][5] - Over the last four quarters, the company has only surpassed consensus revenue estimates once [2] Financial Ratios - The company's price-to-earnings (P/E) ratio is approximately -1.63, indicating negative earnings [3][5] - The price-to-sales ratio stands at about 0.19, suggesting the stock is valued at 19 cents for every dollar of sales [3] - The enterprise value to sales ratio is around 0.25, reflecting the company's total valuation relative to its sales [3] Liquidity and Debt Levels - The debt-to-equity ratio is about 0.51, indicating a moderate level of debt relative to equity [4] - The current ratio is approximately 1.28, suggesting a reasonable level of liquidity to cover short-term liabilities [4] - However, the enterprise value to operating cash flow ratio is significantly negative at around -95.75, highlighting challenges in generating positive cash flow from operations [4][5]

Financial Data and Key Metrics Changes - Consolidated fourth quarter revenue declined by 6.7%, with an 8.8% decline in the Consumer Floral and Gifts segment, a 3.6% decline in the Gourmet Foods and Gift Baskets segment, and a 0.6% decline in the BloomNet segment [8] - For the fiscal year, consolidated revenue declined by 8%, including an 8.2% decline in transactions and a 1.1% decline in average order value (AOV) [9] - Fourth quarter gross margin decreased by 290 basis points to 35.5% compared to 38.4% in the prior year [10] - Adjusted EBITDA loss for the fourth quarter was $24.2 million, compared to a loss of $8.8 million in the prior year [11] - Full year adjusted EBITDA was $29.2 million, down from $93.1 million in the prior year [12] Business Line Data and Key Metrics Changes - Consumer Floral and Gifts segment saw an 8.8% revenue decline, primarily due to a 5.6% decrease in transactions [8] - Gourmet Foods and Gift Baskets segment revenue declined by 3.6% [8] - BloomNet segment revenue declined by 0.6% [8] - Multi-branded customers represented 13% of the customer base and 29% of revenues, while Passport members represented 9% of the customer base and 19% of revenues [9] Market Data and Key Metrics Changes - The company had 9.5 million customers at the end of fiscal 2025, with over 900,000 Passport members [9] - 74% of revenue came from existing customers, indicating a decline in customer count in line with revenue decline [9] Company Strategy and Development Direction - The company is focusing on a "celebration strategy" aimed at transforming customer engagement and operational efficiency [6][13] - Strategic priorities include driving cost savings, building a customer-centric organization, expanding reach beyond e-commerce, and enhancing talent and accountability [13][14] - Plans to modernize the customer experience and improve marketing efficiency are central to the strategy [19][20] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that the company did not keep pace with evolving customer expectations and competition, leading to underperformance [5][6] - The focus is on transforming into a data-driven organization with a clear emphasis on customer retention and marketing efficiency [16][17] - Management expressed optimism about future growth opportunities despite current challenges [23] Other Important Information - The company is engaging an external consultant to identify additional efficiency opportunities [12] - The balance sheet showed net debt of $114 million, up from $31 million a year ago, with a cash balance of $47 million [12][13] Q&A Session Summary Question: Regarding ineffective marketing and technology changes - Management indicated that the focus is shifting to variable contribution margin rather than just revenue, and they are expanding marketing strategies beyond bottom-of-the-funnel approaches [28][30] Question: Competitive dynamics in Consumer Floral - Management noted that competition is general rather than due to a specific bad actor, emphasizing the need for agility in reaching customers through various channels [32][33] Question: Commodity prices normalization - Management confirmed that while cocoa prices remain elevated, many other commodity prices are reverting closer to their mean, with tariffs still presenting a headwind [36][37] Question: Sales performance during major holidays - Mother's Day sales were down year-over-year but aligned with expectations, as the focus shifted to variable contribution margin rather than unprofitable sales [41] Question: Timing of strategic initiatives - Management described the current year as pivotal for setting the foundation for future growth, addressing core business issues, and focusing on customer retention strategies [42][47] Question: CapEx spending and physical retail expansion - Management indicated that CapEx is expected to be slightly down this year, with some investment allocated for physical retail locations [49] Question: Update on retail store performance - The Long Island store is performing well, and the company plans to continue experimenting with pop-up stores and potentially permanent locations based on learnings [57][58]

[Fiscal 2025 Financial Highlights](index=1&type=section&id=Fiscal%202025%20Financial%20Highlights) This section provides an overview of the company's financial performance for the fourth quarter and full fiscal year 2025, including key revenue, profit, and loss metrics [Fourth Quarter Performance](index=1&type=section&id=1.1.%20Fourth%20Quarter%20Performance) For the fiscal 2025 fourth quarter, consolidated revenue decreased by 6.7% to $336.6 million, with a decline in gross profit margin and an increased net loss due to a highly promotional sales environment Fiscal 2025 Fourth Quarter Consolidated Financial Performance | Metric | FY25 Q4 (Millions) | FY24 Q4 (Millions) | Change (%) | | :-------------------- | :----------------- | :----------------- | :--------- | | Total Revenues | $336.6 | $360.9 | -6.7% | | Gross Profit Margin | 35.5% | 38.4% | -290 bps | | Operating Expenses | $174.8 | $166.2 | +$8.6 | | Net Loss | ($51.9) | ($20.9) | -148.3% | | Net Loss Per Share | ($0.82) | ($0.32) | -156.3% | - Gross profit margin decreased primarily due to a highly promotional sales environment and deleveraging on the sales decline[3](index=3&type=chunk) [Full Year Performance](index=2&type=section&id=1.2.%20Full%20Year%20Performance) For the full fiscal year 2025, total consolidated revenues decreased by 8.0% to $1.69 billion, reporting a significant net loss of ($200.0) million, impacted by a substantial non-cash impairment charge Fiscal Year 2025 Consolidated Financial Performance | Metric | FY25 (Billions/Millions) | FY24 (Billions/Millions) | Change (%) | | :-------------------- | :----------------------- | :----------------------- | :--------- | | Total Revenues | $1.69 Billion | $1.83 Billion | -8.0% | | Gross Profit Margin | 38.7% | 40.1% | -140 bps | | Operating Expenses | $857.1 Million | $736.8 Million | +$120.3 | | Net Loss | ($200.0) Million | ($6.1) Million | -3178.7% | | Net Loss Per Share | ($3.13) | ($0.09) | -3377.8% | | Adjusted Net Loss | ($52.5) Million | $11.6 Million | -552.6% | | Adjusted EBITDA | $29.2 Million | $93.1 Million | -68.7% | - The fiscal year net loss includes a **$143.8 million non-cash goodwill and intangible impairment charge**, significantly impacting profitability[6](index=6&type=chunk) - Excluding costs associated with the new order management system implementation, gross profit margin declined **100 basis points to 39.1%** due to a highly promotional sales environment and deleveraging[6](index=6&type=chunk) [CEO Commentary and Strategic Direction](index=1&type=section&id=1.3.%20CEO%20Commentary%20and%20Strategic%20Direction) CEO Adolfo Villagomez outlined a strategic shift to become leaner, more agile, customer-centric, and data-driven, focusing on modernizing customer experience and driving operational discipline for future growth - The company aims to become leaner and more agile, putting the customer at the center of operations and using data for smarter decisions[2](index=2&type=chunk) - Strategic initiatives include sharpening customer attraction and retention, broadening reach beyond e-commerce, and modernizing the customer experience[2](index=2&type=chunk) - The CEO emphasizes driving operational discipline, efficiency, and accountability to position the company for growth and long-term shareholder value[2](index=2&type=chunk) [Segment Results](index=2&type=section&id=Segment%20Results) This section details the financial performance of the company's key segments: Gourmet Foods & Gift Baskets, Consumer Floral & Gifts, and BloomNet, highlighting revenue and margin trends [Gourmet Foods & Gift Baskets](index=2&type=section&id=2.1.%20Gourmet%20Foods%20%26%20Gift%20Baskets) The Gourmet Foods & Gift Baskets segment experienced revenue declines and decreased gross profit margins in both the fourth quarter and full fiscal year 2025, leading to reduced contribution margins Gourmet Foods & Gift Baskets Segment Performance | Metric | FY25 Q4 (Millions) | FY24 Q4 (Millions) | Q4 Change (%) | FY25 (Millions) | FY24 (Millions) | FY Change (%) | | :-------------------------- | :----------------- | :----------------- | :------------ | :-------------- | :-------------- | :------------ | | Revenues | $101.4 | $105.2 | -3.6% | $810.9 | $874.3 | -7.2% | | Gross Profit Margin | 26.0% | 30.0% | -400 bps | 37.6% | 38.3% | -70 bps | | Adjusted Segment Contribution Margin Loss (Q4) | ($19.0) | ($14.4) | -31.9% | | | | | Adjusted Segment Contribution Margin (FY) | | | | $58.8 | $85.0 | -30.8% | - Gross profit margin decline in Q4 was attributed to higher input costs and deleveraging on sales decline[5](index=5&type=chunk) - Full fiscal year gross profit margin, excluding order management system implementation issues, declined **70 basis points**[5](index=5&type=chunk) [Consumer Floral & Gifts](index=3&type=section&id=2.2.%20Consumer%20Floral%20%26%20Gifts) The Consumer Floral & Gifts segment saw declines in both revenue and gross profit margin for the fourth quarter and full fiscal year 2025, primarily due to deleveraging on reduced sales Consumer Floral & Gifts Segment Performance | Metric | FY25 Q4 (Millions) | FY24 Q4 (Millions) | Q4 Change (%) | FY25 (Millions) | FY24 (Millions) | FY Change (%) | | :-------------------------- | :----------------- | :----------------- | :------------ | :-------------- | :-------------- | :------------ | | Revenues | $211.2 | $231.6 | -8.8% | $776.8 | $849.8 | -8.6% | | Gross Profit Margin | 38.5% | 40.8% | -230 bps | 39.3% | 40.8% | -150 bps | | Adjusted Segment Contribution Margin (Q4) | $17.4 | $25.7 | -32.2% | | | | | Adjusted Segment Contribution Margin (FY) | | | | $50.5 | $87.7 | -42.4% | - Gross profit margin decreased due to deleveraging on the sales decline in both the fourth quarter and full fiscal year[7](index=7&type=chunk) [BloomNet](index=3&type=section&id=2.3.%20BloomNet) BloomNet experienced a slight revenue decline in Q4 and a more significant decrease for the full fiscal year 2025, with varying gross profit margin trends and a decline in segment contribution margin BloomNet Segment Performance | Metric | FY25 Q4 (Millions) | FY24 Q4 (Millions) | Q4 Change (%) | FY25 (Millions) | FY24 (Millions) | FY Change (%) | | :-------------------------- | :----------------- | :----------------- | :------------ | :-------------- | :-------------- | :------------ | | Revenues | $24.2 | $24.4 | -0.6% | $98.7 | $107.8 | -8.4% | | Gross Profit Margin | 46.9% | 49.7% | -280 bps | 48.5% | 48.2% | +30 bps | | Adjusted Segment Contribution Margin (Q4) | $6.5 | $7.8 | -16.7% | | | | | Adjusted Segment Contribution Margin (FY) | | | | $29.3 | $33.8 | -13.3% | - Q4 gross profit margin decreased due to higher florist fulfillment costs and rebates[7](index=7&type=chunk) - Full fiscal year gross profit margin increased, benefiting from lower florist rebates[7](index=7&type=chunk) [Fiscal 2026 Strategic Outlook](index=3&type=section&id=Fiscal%202026%20Strategic%20Outlook) Fiscal Year 2026 is a pivotal period for 1-800-FLOWERS.COM, Inc. to establish a foundation for long-term growth by transforming into a customer-centric, data-driven organization aligned with its Celebrations Wave strategy - Fiscal Year 2026 will focus on foundation setting, transforming into a customer-centric, data-driven organization[8](index=8&type=chunk) - Strategic priorities include driving cost savings and organizational efficiency, building a customer-centric and data-driven organization, broadening reach into new channels, and strengthening the team[8](index=8&type=chunk)[10](index=10&type=chunk) - The company aims to support its multi-year Celebrations Wave strategy and fuel future growth through these foundational steps[8](index=8&type=chunk) [Non-GAAP Financial Measures Definitions](index=4&type=section&id=Non-GAAP%20Financial%20Measures%20Definitions) This section provides definitions and explanations for the non-GAAP financial measures used by the company to supplement its GAAP results and provide additional insights into performance [EBITDA and Adjusted EBITDA](index=4&type=section&id=4.1.%20EBITDA%20and%20Adjusted%20EBITDA) EBITDA is defined as net income (loss) before interest, taxes, depreciation, and amortization, with Adjusted EBITDA further adjusting for specific items to enhance comparability and serve as a key performance indicator - EBITDA is Net Income (Loss) before interest, taxes, depreciation, and amortization[12](index=12&type=chunk) - Adjusted EBITDA includes adjustments for stock-based compensation, NQDC investment appreciation/depreciation, and other comparability items[12](index=12&type=chunk) - These non-GAAP measures are used for evaluating performance, determining incentive compensation, credit agreement compliance, and acquisition pricing[12](index=12&type=chunk) [Segment Contribution Margin and Adjusted Segment Contribution Margin](index=4&type=section&id=4.2.%20Segment%20Contribution%20Margin%20and%20Adjusted%20Segment%20Contribution%20Margin) Segment Contribution Margin represents earnings before interest, taxes, depreciation, amortization, and corporate overhead allocation, with Adjusted Segment Contribution Margin including further adjustments for comparability to provide insights into segment performance - Segment Contribution Margin is earnings before interest, taxes, depreciation, amortization, and corporate overhead allocation[13](index=13&type=chunk) - Adjusted Segment Contribution Margin includes adjustments for items affecting period-to-period comparability[13](index=13&type=chunk) - These measures offer meaningful information about business segment performance by reflecting direct controllable revenue and operating expenses[13](index=13&type=chunk) [Adjusted Net Income (Loss) and Adjusted or Comparable Net Income (Loss) Per Common Share](index=5&type=section&id=4.3.%20Adjusted%20Net%20Income%20%28Loss%29%20and%20Adjusted%20or%20Comparable%20Net%20Income%20%28Loss%29%20Per%20Common%20Share) Adjusted Net Income (Loss) and its per-share equivalent are GAAP net income (loss) measures adjusted for specific items to enhance period-to-period comparability and provide a clearer view of underlying operating performance - Adjusted Net Income (Loss) and Per Common Share metrics are adjusted for items affecting period-to-period comparability[15](index=15&type=chunk) - These measures are considered meaningful because they increase the comparability of results across different periods[15](index=15&type=chunk) [Free Cash Flow](index=5&type=section&id=4.4.%20Free%20Cash%20Flow) Free Cash Flow is defined as net cash provided by (used in) operating activities less capital expenditures, serving as a liquidity measure to indicate cash available for investments, acquisitions, and balance sheet strengthening - Free Cash Flow is calculated as net cash provided by (used in) operating activities minus capital expenditures[16](index=16&type=chunk) - This liquidity measure provides insight into cash available for investments, acquisitions, balance sheet improvements, and shareholder returns[16](index=16&type=chunk) [About 1-800-FLOWERS.COM, Inc.](index=5&type=section&id=About%201-800-FLOWERS.COM%2C%20Inc.) 1-800-FLOWERS.COM, Inc. is a leading e-commerce provider of thoughtful expressions, operating a diverse portfolio of brands and industry services, recognized for its trustworthiness and workplace environment - 1-800-FLOWERS.COM, Inc. is a leading provider of thoughtful expressions, inspiring customers to connect and build relationships[17](index=17&type=chunk) - The company's e-commerce platform features a family of brands including 1-800-Flowers.com®, Harry & David®, Cheryl's Cookies®, and more[17](index=17&type=chunk) - It operates BloomNet®, an international floral and gift industry service provider, and has been recognized among America's Most Trustworthy Companies and Most Admired Workplaces[17](index=17&type=chunk) [Special Note Regarding Forward-Looking Statements](index=6&type=section&id=Special%20Note%20Regarding%20Forward-Looking%20Statements) This section cautions that forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, advising investors to refer to SEC filings for detailed risk factors - Forward-looking statements are subject to risks, uncertainties, and other factors that could cause actual results to differ materially from expectations[19](index=19&type=chunk) - The company undertakes no obligation to publicly update any forward-looking statements[19](index=19&type=chunk) - Investors should refer to the company's SEC filings, including Form 10-K and 10-Q, for a detailed description of risk factors[19](index=19&type=chunk) [Condensed Consolidated Financial Statements](index=7&type=section&id=Condensed%20Consolidated%20Financial%20Statements) This section presents the company's condensed consolidated balance sheets, statements of operations, and statements of cash flows, offering a snapshot of its financial position and performance [Condensed Consolidated Balance Sheets](index=7&type=section&id=7.1.%20Condensed%20Consolidated%20Balance%20Sheets) The condensed consolidated balance sheets show a decrease in total assets from $1,032.6 million in FY24 to $772.6 million in FY25, primarily due to reduced cash and goodwill impairment, alongside declines in total liabilities and stockholders' equity Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | June 29, 2025 | June 30, 2024 | | :-------------------------------- | :------------ | :------------ | | Cash and cash equivalents | $46,502 | $159,437 | | Total current assets | $282,727 | $385,732 | | Goodwill | $37,625 | $156,537 | | Trademarks with indefinite lives | $86,673 | $111,473 | | Total assets | $772,617 | $1,032,648 | | Total current liabilities | $221,386 | $227,819 | | Long term debt, net | $134,764 | $177,113 | | Total liabilities | $504,335 | $566,306 | | Total stockholders' equity | $268,282 | $466,342 | - Goodwill decreased significantly from **$156.5 million to $37.6 million**, reflecting the impairment charge[22](index=22&type=chunk) - Cash and cash equivalents decreased by over **70%** year-over-year[22](index=22&type=chunk) [Consolidated Statements of Operations](index=8&type=section&id=7.2.%20Consolidated%20Statements%20of%20Operations) The consolidated statements of operations reveal declining total net revenues and gross profit for both the quarter and full fiscal year 2025, with significantly increased operating expenses and net loss primarily due to impairment charges Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | FY25 Q4 | FY24 Q4 | FY25 | FY24 | | :-------------------------------- | :------ | :------ | :----- | :----- | | Total net revenues | $336,622 | $360,912 | $1,685,658 | $1,831,421 | | Gross profit | $119,361 | $138,411 | $652,272 | $734,753 | | Total operating expenses | $174,840 | $166,227 | $857,085 | $736,825 | | Operating loss | ($55,479) | ($27,816) | ($204,813) | ($2,072) | | Net loss | ($51,907) | ($20,867) | ($199,993) | ($6,105) | | Basic and diluted net loss per common share | ($0.82) | ($0.32) | ($3.13) | ($0.09) | - Goodwill impairment of **$119.0 million** and intangible impairment of **$24.8 million** were recorded in FY25, contributing significantly to the operating loss[24](index=24&type=chunk) - E-Commerce revenues decreased from **$1,614.2 million in FY24 to $1,464.4 million in FY25**[24](index=24&type=chunk) [Consolidated Statement of Cash Flows](index=9&type=section&id=7.3.%20Consolidated%20Statement%20of%20Cash%20Flows) The consolidated statement of cash flows indicates a shift from net cash provided by operating activities in FY24 to net cash used in FY25, with continued cash usage in investing and financing activities, resulting in a substantial decrease in cash and cash equivalents Consolidated Statement of Cash Flows Highlights (in thousands) | Metric | FY25 | FY24 | | :------------------------------------------ | :------- | :------- | | Net cash (used in) provided by operating activities | ($26,363) | $94,999 | | Net cash used in investing activities | ($44,463) | ($42,304) | | Net cash used in financing activities | ($42,109) | ($20,065) | | Net change in cash and cash equivalents | ($112,935) | $32,630 | | Cash and cash equivalents, End of period | $46,502 | $159,437 | - The company used **$26.4 million** in cash from operating activities in FY25, a significant reversal from providing **$95.0 million** in FY24[25](index=25&type=chunk) - Repayment of bank borrowings (**$140.0 million**) exceeded proceeds from bank borrowings (**$110.0 million**) in FY25[25](index=25&type=chunk) [Reconciliations of Non-GAAP Financial Measures](index=10&type=section&id=Reconciliations%20of%20Non-GAAP%20Financial%20Measures) This section provides detailed reconciliations of GAAP financial measures to their non-GAAP counterparts, including adjusted net income (loss), adjusted EBITDA, and free cash flow, for enhanced comparability [Reconciliation of Net Loss to Adjusted Net Income (Loss)](index=12&type=section&id=8.1.%20Reconciliation%20of%20Net%20Loss%20to%20Adjusted%20Net%20Income%20%28Loss%29) This reconciliation details adjustments made to GAAP net loss to derive adjusted net income (loss) for both the fourth quarter and full fiscal year, including restructuring costs, system implementation costs, and impairment charges Reconciliation of Net Loss to Adjusted Net Income (Loss) (in thousands, except per share data) | Metric | FY25 Q4 | FY24 Q4 | FY25 | FY24 | | :------------------------------------------ | :------ | :------ | :----- | :----- | | Net loss | ($51,907) | ($20,867) | ($199,993) | ($6,105) | | Add: Restructuring cost/Severance | $5,115 | $147 | $5,823 | $2,564 | | Add: System implementation costs | — | — | $13,401 | — | | Add: Goodwill and intangible impairment | $5,603 | — | $143,823 | $19,762 | | Deduct: Income tax effect on adjustments | ($2,639) | ($2,541) | ($15,572) | ($6,079) | | Adjusted net income (loss) (non-GAAP) | ($43,828) | ($21,792) | ($52,518) | $11,611 | | Basic and diluted adjusted net income (loss) per common share (non-GAAP) | ($0.69) | ($0.34) | ($0.82) | $0.18 | - Adjusted net loss for FY25 was **($52.5) million**, compared to an adjusted net income of **$11.6 million** in FY24[31](index=31&type=chunk) [Reconciliation of Net Loss to Adjusted EBITDA](index=13&type=section&id=8.2.%20Reconciliation%20of%20Net%20Loss%20to%20Adjusted%20EBITDA) This reconciliation outlines the adjustments from GAAP net loss to Adjusted EBITDA for both the fourth quarter and full fiscal year, incorporating items such as interest, taxes, depreciation, amortization, stock-based compensation, and impairment charges Reconciliation of Net Loss to Adjusted EBITDA (in thousands) | Metric | FY25 Q4 | FY24 Q4 | FY25 | FY24 | | :------------------------------------------ | :------ | :------ | :----- | :----- | | Net loss | ($51,907) | ($20,867) | ($199,993) | ($6,105) | | EBITDA | ($42,148) | ($14,642) | ($151,195) | $51,680 | | Add: Stock-based compensation | $2,785 | $3,047 | $11,891 | $10,688 | | Add: Compensation charge related to NQDC Plan investment appreciation | $4,399 | $1,192 | $5,423 | $6,904 | | Add: System implementation costs | — | — | $13,401 | — | | Add: Goodwill and intangible impairment | $5,603 | — | $143,823 | $19,762 | | Adjusted EBITDA | ($24,246) | ($8,787) | $29,166 | $93,067 | - Adjusted EBITDA for FY25 was **$29.2 million**, a significant decrease from **$93.1 million** in FY24[33](index=33&type=chunk) - The reconciliation highlights the impact of non-recurring charges like goodwill and intangible impairment (**$143.8 million in FY25**) on GAAP net loss[33](index=33&type=chunk) [Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow](index=14&type=section&id=8.3.%20Reconciliation%20of%20Net%20Cash%20%28Used%20in%29%20Provided%20by%20Operating%20Activities%20to%20Free%20Cash%20Flow) This section reconciles net cash provided by (used in) operating activities to free cash flow by subtracting capital expenditures, revealing a negative free cash flow for fiscal year 2025, a reversal from the prior year Reconciliation of Net Cash (Used in) Provided by Operating Activities to Free Cash Flow (in thousands) | Metric | FY25 | FY24 | | :------------------------------------------ | :-------- | :-------- | | Net cash (used in) provided by operating activities | ($26,363) | $94,999 | | Capital expenditures | ($41,463) | ($38,632) | | Free cash flow | ($67,826) | $56,367 | - Free cash flow for FY25 was **($67.8) million**, compared to **$56.4 million** in FY24, indicating a significant decrease in cash generated after capital expenditures[37](index=37&type=chunk)

Group 1 - The article highlights a surge in stock prices for companies like Krispy Kreme and GoPro, driven by retail investor interest and high short-selling ratios [1][3] - Krispy Kreme's stock rose approximately 34% in pre-market trading, following a nearly 27% increase the previous day, while GoPro's stock soared over 83% after a 41% rise [1] - Companies such as Beyond Meat and 1-800-Flowers.com also experienced pre-market increases of around 15%, with high short-selling ratios of 38% and 71.66% respectively [1] Group 2 - The article discusses the phenomenon of "meme stocks," which are characterized by retail investor enthusiasm and lack of fundamental support for price increases [3] - S3 Partners' Ihor Dusaniwsky describes meme stocks as "battlefield stocks," where retail investors and short-sellers engage in intense market competition [3] - The article draws parallels to the speculative frenzy surrounding GameStop during the pandemic, warning that rapid price increases could be followed by equally swift declines [3] Group 3 - Analysts, including Barclays' Stefano Pascale, express concerns about excessive market enthusiasm, citing signs of a bubble, such as the rise of SPAC mergers and the performance of ARK Innovation ETF [4] - Pascale emphasizes that certain market segments exhibit significant bubble characteristics, indicating potential risks for investors [4]

Core Viewpoint - The upcoming earnings season presents potential short-term trading opportunities in consumer discretionary stocks, despite the traditionally lower trading volumes in summer [1] Group 1: Topgolf Callaway Brands Corp. (MODG) - MODG stock has declined nearly 80% since peaking at approximately $37 in late 2021, currently priced at $7.82 with a 12-month price forecast of $10.30, indicating a potential upside of 31.80% [4][7] - The company plans to spin off about 80% of its Topgolf business in 2025, which may enhance the performance of both Topgolf and Callaway as separate entities [6] - Recent insider buying by director Adebayo O Ogunlesi suggests confidence in the stock's undervaluation, supported by bullish analyst sentiment [3][6] Group 2: Traeger Inc. (COOK) - COOK stock is currently priced at $1.77, with a 12-month price forecast of $2.44, indicating a potential upside of 38.10% [8] - The stock has decreased by 29% over the past year and 25% in 2025, with the company facing challenges due to high interest rates and inflation [10] - Despite being unprofitable and having net debt of $410 million, Traeger has shown expanding net margins and raised its full-year revenue and earnings guidance [10] Group 3: 1-800-FLOWERS.COM Inc. (FLWS) - FLWS stock is currently priced at $5.10, with a 12-month price forecast of $7.50, indicating a potential upside of 47.06% [12] - The stock has declined by 36.9% in 2025 and faces strong competition, but the company is investing in artificial intelligence to enhance marketing and fulfillment [12][13] - Major shareholder Fund 1 Investments has made multiple stock purchases, indicating confidence in the company's potential turnaround [13]

Company Overview - 1-800-FLOWERS.COM (NASDAQ: FLWS) operates in the gifts sector, offering a diverse product portfolio that includes flowers, fruit arrangements, plants, gourmet foods, and personalized products [1] Stock Performance - The stock has experienced a decline of approximately 37% year-to-date and 47% over the past year, attributed to a loss of investor confidence [1] Investment Strategy - The investment approach focuses on value and deep value, with interests in sectors such as financial services (regional banks and insurance), retail, software/technology, and waste management [1] - The strategy emphasizes a concentrated portfolio in a few key companies, supported by thorough research on industry trends, competitors, key success drivers, and management [1] Valuation Emphasis - A significant focus is placed on valuation, with the belief that smart investments require a deep understanding of both qualitative aspects and a valuation that aligns with the company's narrative [1] Educational Background - The educational background includes a specialization in Accounting and a minor in Economics from Wilfrid Laurier University, with ongoing efforts to obtain a CPA designation [1] Professional Role - Currently employed at a large Financial Services company in Toronto, Canada, in a non-investment risk-related role [1] Investment Philosophy - The investment philosophy involves understanding unknowns rather than knowns, with a focus on managing risks to avoid permanent capital losses [1]

[Part I. Financial Information](index=4&type=section&id=Part%20I.%20Financial%20Information) [Condensed Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) The company reported a significant Q3 net loss of $178.2 million, driven by a $138.2 million impairment charge, which also contributed to a decrease in total assets and a sharp decline in operating cash flow Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 30, 2025 | June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | $84,684 | $159,437 | ($74,753) | | Goodwill | $43,228 | $156,537 | ($113,309) | | Other intangibles, net | $89,820 | $116,216 | ($26,396) | | Total assets | $806,217 | $1,032,648 | ($226,431) | | Long-term debt, net | $142,278 | $177,113 | ($34,835) | | Retained earnings | $116,892 | $264,978 | ($148,086) | | Total stockholders' equity | $317,730 | $466,342 | ($148,612) | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q3 2025 | Q3 2024 | 9 Months 2025 | 9 Months 2024 | | :--- | :--- | :--- | :--- | :--- | | Net revenues | $331,454 | $379,405 | $1,349,036 | $1,470,509 | | Gross profit | $104,999 | $138,717 | $532,911 | $596,342 | | Goodwill and intangible impairment | $138,220 | $0 | $138,220 | $19,762 | | Operating income (loss) | ($193,430) | ($27,929) | ($149,334) | $25,744 | | Net income (loss) | ($178,244) | ($16,903) | ($148,086) | $14,762 | | Diluted net income (loss) per share | ($2.80) | ($0.26) | ($2.32) | $0.23 | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | Nine Months Ended Mar 30, 2025 | Nine Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $706 | $100,051 | | Net cash used in investing activities | ($35,431) | ($26,482) | | Net cash used in financing activities | ($40,028) | ($16,420) | | Net change in cash and cash equivalents | ($74,753) | $57,149 | - The company recorded a significant non-cash **goodwill and intangible impairment charge of $138.2 million** in the quarter ended March 30, 2025, related to the Consumer Floral & Gifts reporting unit[28](index=28&type=chunk)[50](index=50&type=chunk) - Due to a **three-year cumulative loss position** and the impairment charge, the company established a **valuation allowance of $24.9 million** against its deferred tax assets as their realization is no longer more likely than not[74](index=74&type=chunk)[168](index=168&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=25&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes revenue declines to macroeconomic conditions, leading to a significant impairment charge, a new transformation plan, the withdrawal of financial guidance, and a sharp reversal in free cash flow - Broader macro-economic conditions continue to impact consumers, leading to a **reduction in 'everyday or just-because' gift giving** and customers shopping later in holiday seasons[84](index=84&type=chunk) - The company announced **'Celebrations Wave,'** a comprehensive strategic evolution to transform the customer experience, expected to result in **restructuring charges of $10.0 million to $15.0 million**[90](index=90&type=chunk) - Citing the rapidly evolving macroeconomic landscape and a focus on its transformational strategy, the company has **withdrawn its near-term financial guidance**[91](index=91&type=chunk) Free Cash Flow (Non-GAAP, in thousands) | Period | Nine Months Ended Mar 30, 2025 | Nine Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $706 | $100,051 | | Capital expenditures | ($32,431) | ($26,482) | | **Free cash flow** | **($31,725)** | **$73,569** | [Results of Operations](index=33&type=section&id=Results%20of%20Operations) Third-quarter revenue fell 12.6% due to e-commerce declines, while a $138.2 million impairment charge drove a substantial operating loss and contracted gross margins Net Revenue by Segment - Q3 YoY Change (in thousands) | Segment | Q3 2025 Revenue | Q3 2024 Revenue | % Change | | :--- | :--- | :--- | :--- | | Consumer Floral & Gifts | $196,030 | $221,207 | -11.4% | | BloomNet | $28,552 | $27,314 | +4.5% | | Gourmet Foods & Gift Baskets | $107,088 | $130,989 | -18.2% | | **Total Net Revenues** | **$331,454** | **$379,405** | **-12.6%** | - **E-commerce revenues decreased 14.2% in Q3** and 9.8% in the nine-month period, primarily due to a decline in order volume[118](index=118&type=chunk)[119](index=119&type=chunk) - **Gross profit percentage for Q3 decreased by 490 basis points** (from 36.6% to 31.7%) and for the nine-month period by 110 basis points (from 40.6% to 39.5%)[130](index=130&type=chunk)[132](index=132&type=chunk) - A non-cash **goodwill and intangible impairment charge of $138.2 million** was recorded in Q3 2025 for the Consumer and Floral & Gifts segment and the PersonalizationMall tradename[144](index=144&type=chunk) [Liquidity and Capital Resources](index=40&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity tightened with decreased working capital and cash balances, driven by near-zero operating cash flow, capital expenditures, and net debt repayments - **Working capital stood at $108.1 million** as of March 30, 2025, down from $157.9 million at June 30, 2024, while cash and cash equivalents decreased from $159.4 million to $84.7 million[151](index=151&type=chunk) - Cash generated from operations allowed the company to **repay the $110.0 million** borrowed under its revolving credit facility and make a **$27.5 million payment on its Term Loan**[153](index=153&type=chunk) - Net cash used in financing activities was **$40.0 million** for the nine months, primarily from net repayments of bank borrowings, a **$30.0 million payment on the Term Loan**, and **$9.9 million in common stock repurchases**[157](index=157&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=44&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate changes on its variable-rate debt, with a hypothetical 50 basis point increase adding $0.7 million to nine-month interest expense - The company is exposed to interest rate risk through its variable-rate long-term debt; a hypothetical **50 basis point increase in rates** would have increased interest expense by approximately **$0.7 million** for the nine-month period[175](index=175&type=chunk) [Controls and Procedures](index=44&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 30, 2025, with no material changes to internal control over financial reporting - Based on an evaluation as of March 30, 2025, the CEO and CFO concluded that the company's **disclosure controls and procedures were effective**[176](index=176&type=chunk) - **No changes in internal control over financial reporting** occurred during the quarter that have materially affected, or are reasonably likely to materially affect, internal controls[177](index=177&type=chunk) [Part II. Other Information](index=44&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) Management believes the final resolution of various incidental claims and lawsuits will not materially harm the company's financial position, results, or liquidity - Management opines that pending legal proceedings are **not expected to have a material adverse effect** on the Company's financial condition or results of operations[179](index=179&type=chunk) [Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the company's risk factors as disclosed in its Annual Report on Form 10-K for the fiscal year ended June 30, 2024 - **No material changes** to the Company's risk factors were reported for the period[180](index=180&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=45&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company repurchased 276,760 shares for $2.2 million in Q3, with $11.7 million remaining authorized for future repurchases under the existing plan Common Stock Repurchases - Q3 2025 | Period | Total Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | 12/30/24 – 1/26/25 | 199,103 | $7.98 | | 1/27/25 - 2/23/25 | 73,144 | $8.30 | | 2/24/25 - 3/30/25 | 4,513 | $5.93 | | **Total** | **276,760** | **$8.03** | - As of March 30, 2025, **$11.7 million remained available** for repurchase under the company's stock repurchase plan[181](index=181&type=chunk)