UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MAY 1, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 000-51300 ZUMIEZ INC. (Exact name of registrant as specified in its charter) Washington 91-1040022 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) I ...

Zumiez Inc. (NASDAQ:ZUMZ) Q1 2021 Earnings Conference Call June 3, 2021 5:00 PM ET Company Participants Rick Brooks - Chief Executive Officer Chris Work - Chief Financial Officer Conference Call Participants Jeff Van Sinderen - B. Riley Janine Stitcher - Jefferies Jonathan Komp - Baird Mitch Kummetz - Pivotal Research Operator Good afternoon, ladies and gentlemen, and welcome to the Zumiez, Inc. First Quarter Fiscal 2021 Earnings Conference Call [Operator Instructions]. Before we begin, I'd like to remind ...

```markdown [Part I](index=3&type=section&id=PART%20I) [Business](index=3&type=section&id=Item%201.%20Business) Zumiez Inc. is a global specialty retailer of apparel, footwear, and accessories, operating 721 stores and e-commerce sites for action sports and youth lifestyles - As of January 30, 2021, Zumiez operated **721 stores** globally: **602** in the U.S., **52** in Canada, **54** in Europe, and **13** in Australia under the brand names Zumiez, Blue Tomato, and Fast Times[17](index=17&type=chunk) - The company's growth strategy includes generating sales growth through existing channels, enhancing brand awareness via marketing, and opening approximately **22** new stores in fiscal 2021, with a focus on international markets[31](index=31&type=chunk)[32](index=32&type=chunk)[33](index=33&type=chunk) Merchandise Mix Fiscal Years 2018-2020 | Category | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | **Private Label % of Net Sales** | 11.4% | 11.3% | 13.1% | | **Largest 3rd Party Brand % of Net Sales** | 9.4% | 13.9% | 12.4% | Store Activity (Fiscal Years 2018-2020) | Fiscal Year | Stores Opened | Stores Closed | Total Stores End of Year | | :--- | :--- | :--- | :--- | | 2020 | 12 | 9 | 721 | | 2019 | 16 | 5 | 718 | | 2018 | 13 | 4 | 707 | - The business is seasonal, with approximately **60%** of net sales in fiscal 2020 occurring in the third and fourth quarters, driven by back-to-school and holiday shopping seasons[56](index=56&type=chunk) [Risk Factors](index=11&type=section&id=Item%201A.%20Risk%20Factors) The company faces multiple risks including the COVID-19 pandemic, volatile fashion trends, intense competition, and economic dependency - The COVID-19 pandemic poses a material risk through potential store closures, supply chain disruptions, and negative impacts on consumer spending and confidence[66](index=66&type=chunk)[67](index=67&type=chunk)[68](index=68&type=chunk) - The company's success is highly dependent on its ability to anticipate and react to rapidly changing fashion trends; failure to do so could result in lower sales and excess inventory[74](index=74&type=chunk) - A heavy reliance on mall-based stores creates a risk associated with declining consumer traffic in malls, which could be exacerbated by economic downturns, competition, or health emergencies[80](index=80&type=chunk) - The business is highly seasonal, with a majority of sales and profits occurring in the third and fourth quarters. Negative factors during this period could have a material adverse effect on full-year results[85](index=85&type=chunk) - Cybersecurity risks are a significant concern. A failure to protect confidential and personal data could result in litigation, penalties, and reputational damage[89](index=89&type=chunk) [Unresolved Staff Comments](index=21&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reports no unresolved staff comments from the Securities and Exchange Commission - None[124](index=124&type=chunk) [Properties](index=21&type=section&id=Item%202.%20Properties) The company operates 721 leased stores totaling 2.1 million square feet, owning its home office and domestic distribution center, and leasing international facilities - All **721 stores** are occupied under operating leases, totaling approximately **2.1 million square feet**[125](index=125&type=chunk) - The company owns its **63,071 square foot** home office in Lynnwood, WA and a **168,450 square foot** distribution center in Corona, CA[125](index=125&type=chunk)[126](index=126&type=chunk) - Leased distribution centers support operations in Canada (**17,168 sq ft**), Europe (**112,112 sq ft**), and Australia (**10,010 sq ft**)[127](index=127&type=chunk) [Legal Proceedings](index=21&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in routine litigation not expected to materially affect its financial condition or operations - The company is involved in routine litigation incidental to its business, which is not expected to have a material adverse effect[128](index=128&type=chunk) [Mine Safety Disclosures](index=21&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company's operations - Not applicable[129](index=129&type=chunk) [Part II](index=22&type=section&id=PART%20II) [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=22&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) Zumiez common stock trades on Nasdaq, with no dividends declared, and a **$100.0 million** share repurchase program authorized in December 2020 remains available - The company's common stock trades on the Nasdaq Global Select Market under the symbol "ZUMZ"[131](index=131&type=chunk) - No cash dividends have been declared on common stock to date[136](index=136&type=chunk) - In December 2020, the Board authorized a repurchase of up to **$100.0 million** of common stock, which was fully available at the end of the fiscal year[137](index=137&type=chunk) [Selected Financial Data](index=24&type=section&id=Item%206.%20Selected%20Financial%20Data) This section summarizes five years of financial data, showing fiscal 2020 net sales of **$990.7 million** and net income of **$76.2 million**, despite COVID-19 impacts Selected Financial Data (2018-2020) | (in thousands, except per share data) | Fiscal 2020 | Fiscal 2019 | Fiscal 2018 | | :--- | :--- | :--- | :--- | | **Net sales** | $990,652 | $1,034,129 | $978,617 | | **Operating profit** | $96,938 | $85,807 | $61,078 | | **Net income** | $76,227 | $66,881 | $45,205 | | **Diluted EPS** | $3.00 | $2.62 | $1.79 | | **Comparable sales increase** | 13.6% | 4.9% | 5.6% | | **Number of stores** | 721 | 718 | 707 | - Fiscal 2020 results were significantly impacted by the COVID-19 pandemic, during which stores were open for approximately **78.4%** of the possible days[142](index=142&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses fiscal 2020 financial performance, highlighting record profitability despite sales decrease, strong liquidity, and plans for fiscal 2021 growth [Overview](index=26&type=section&id=Overview) Despite a **4.2%** sales decline in fiscal 2020, Zumiez achieved record profitability with **$3.00 diluted EPS**, driven by strong margins and expense control, with plans for **22** new stores in fiscal 2021 Fiscal 2020 vs. 2019 Performance | Metric | Fiscal 2020 | Fiscal 2019 | % Change | | :--- | :--- | :--- | :--- | | Net sales (in thousands) | $990,652 | $1,034,129 | -4.2% | | Operating profit (in thousands) | $96,938 | $85,807 | 13.0% | | Operating margin | 9.8% | 8.3% | +150 bps | | Diluted earnings per share | $3.00 | $2.62 | 14.5% | - For fiscal 2021, the company plans to open approximately **22** new stores and anticipates growing operating margins for the full year compared to fiscal 2020[150](index=150&type=chunk)[151](index=151&type=chunk) [Results of Operations](index=29&type=section&id=Results%20of%20Operations) Fiscal 2020 saw a **4.2%** net sales decrease to **$990.7 million**, offset by **13.6%** comparable sales growth, with improved operating margin to **9.8%** and net income rising to **$76.2 million** - In fiscal 2020, net sales decreased **4.2%** to **$990.7 million**, but comparable sales increased **13.6%**, driven by strong e-commerce performance during store closures[164](index=164&type=chunk) - Gross profit as a percentage of sales decreased by **10 basis points** to **35.3%** in fiscal 2020, primarily due to increased web fulfillment costs, partially offset by higher product margins and lower inventory shrinkage[167](index=167&type=chunk) - SG&A expenses as a percentage of sales decreased by **160 basis points** to **25.5%** in fiscal 2020, driven by governmental credits, lower store wages, and reduced corporate costs[168](index=168&type=chunk) - Net income for fiscal 2020 was **$76.2 million**, or **$3.00 per diluted share**, an increase from **$66.9 million**, or **$2.62 per diluted share**, in fiscal 2019[169](index=169&type=chunk) [Liquidity and Capital Resources](index=32&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity with **$375.5 million** in cash and marketable securities, **$138.4 million** in operating cash flow, and plans **$20 million to $22 million** in fiscal 2021 capital expenditures Cash and Working Capital (in millions) | Metric | Jan 30, 2021 | Feb 1, 2020 | | :--- | :--- | :--- | | Cash, cash equivalents & current marketable securities | $375.5 | $251.2 | | Working capital | $339.8 | $252.9 | Summary of Cash Flows (in thousands) | Activity | Fiscal 2020 | Fiscal 2019 | Fiscal 2018 | | :--- | :--- | :--- | :--- | | Operating activities | $138,412 | $106,070 | $65,406 | | Investing activities | $(110,541) | $(102,931) | $(36,398) | | Financing activities | $(9,694) | $2,010 | $120 | - Capital expenditures are expected to be approximately **$20 million to $22 million** in fiscal 2021, primarily for about **22** new stores and existing store remodels[195](index=195&type=chunk) [Critical Accounting Estimates](index=34&type=section&id=Critical%20Accounting%20Estimates) Management identifies critical accounting estimates including inventory valuation, impairment testing of long-lived assets, goodwill, and indefinite-lived intangible assets, requiring significant judgment and future cash flow projections - Valuation of merchandise inventories requires management to make assumptions about sales rates and shrinkage. A **10%** increase in the actual physical inventory shrinkage rate would have decreased fiscal 2020 net income by **$0.1 million**[199](index=199&type=chunk)[202](index=202&type=chunk)[204](index=204&type=chunk) - Long-lived assets are reviewed for impairment when events indicate their carrying value may not be recoverable, requiring management to estimate future cash flows and asset fair values[205](index=205&type=chunk)[207](index=207&type=chunk) - Goodwill and indefinite-lived intangible assets are tested for impairment annually, a process that involves complex judgments about future cash flows, growth rates, and discount rates. No impairment was recorded in fiscal 2020[231](index=231&type=chunk)[234](index=234&type=chunk)[236](index=236&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=39&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks from interest rate fluctuations and foreign currency exchange rates, with hypothetical **10%** changes impacting fiscal 2020 net income by **$0.3 million** and **$0.5 million** respectively - A hypothetical **10%** decrease in the average yield rate of the company's investment portfolio in fiscal 2020 would have decreased net income by **$0.3 million**[243](index=243&type=chunk) - A hypothetical **10%** change in foreign exchange rates in fiscal 2020 would have increased or decreased net income by **$0.5 million**[245](index=245&type=chunk) [Financial Statements and Supplementary Data](index=39&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This item refers to the consolidated financial statements and related notes, included in Part IV, Item 15 of the Form 10-K - The company's consolidated financial statements are provided in Part IV, Item 15 of this report[247](index=247&type=chunk) [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=40&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20with%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reports no changes in or disagreements with its accountants on accounting and financial disclosure - None[249](index=249&type=chunk) [Controls and Procedures](index=40&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded disclosure controls and internal control over financial reporting were effective as of January 30, 2021, with the independent auditor issuing an unqualified opinion - Management, including the CEO and CFO, concluded that disclosure controls and procedures were effective as of January 30, 2021[250](index=250&type=chunk) - Management's assessment concluded that the company's internal control over financial reporting was effective as of January 30, 2021[254](index=254&type=chunk) - The independent auditor, Moss Adams LLP, issued an unqualified opinion on the effectiveness of the company's internal control over financial reporting[258](index=258&type=chunk) [Other Information](index=42&type=section&id=Item%209B.%20Other%20Information) The company reports no other information for this item - None[265](index=265&type=chunk) [Part III](index=43&type=section&id=PART%20III) [Directors, Executive Officers, Corporate Governance, Compensation, and Security Ownership](index=43&type=section&id=Items%2010-14) Information for Items 10-14, covering directors, executive officers, corporate governance, compensation, and security ownership, is incorporated by reference from the 2021 proxy statement - Information regarding directors, executive officers, corporate governance, executive compensation, security ownership, and principal accountant fees is incorporated by reference from the company's definitive proxy statement[267](index=267&type=chunk)[268](index=268&type=chunk)[269](index=269&type=chunk) [Part IV](index=44&type=section&id=PART%20IV) [Exhibits, Financial Statement Schedules](index=44&type=section&id=Item%2015.%20Exhibits%2C%20Financial%20Statement%20Schedules) This section contains the index to consolidated financial statements and a list of exhibits filed with the Form 10-K, with schedules omitted as not applicable or included elsewhere - This item includes the consolidated financial statements and an index of all exhibits filed with the report[273](index=273&type=chunk) [Consolidated Financial Statements](index=45&type=section&id=Consolidated%20Financial%20Statements) [Report of Independent Registered Public Accounting Firm](index=46&type=section&id=Report%20of%20Independent%20Registered%20Public%20Accounting%20Firm) The independent auditor issued an unqualified opinion on the consolidated financial statements and internal control over financial reporting, identifying goodwill, intangible, and store asset impairment as Critical Audit Matters - The auditor issued an unqualified (clean) opinion on the consolidated financial statements and the effectiveness of internal control over financial reporting[278](index=278&type=chunk)[279](index=279&type=chunk) - Critical Audit Matters identified were "Goodwill and Intangible Asset Impairment" and "Store Asset Impairment" due to the high degree of management judgment and significant assumptions required in these areas[284](index=284&type=chunk)[287](index=287&type=chunk) [Financial Statements](index=49&type=section&id=Financial%20Statements) The consolidated financial statements show total assets of **$998.4 million**, total liabilities of **$445.8 million**, net sales of **$990.7 million**, and net income of **$76.2 million** for fiscal 2020 Consolidated Balance Sheet Highlights (as of Jan 30, 2021) | Account (in thousands) | Amount | | :--- | :--- | | Cash and cash equivalents | $73,622 | | Total assets | $998,364 | | Total liabilities | $445,768 | | Total shareholders' equity | $552,596 | Consolidated Income Statement Highlights (Fiscal Year 2020) | Account (in thousands) | Amount | | :--- | :--- | | Net sales | $990,652 | | Gross profit | $350,015 | | Operating profit | $96,938 | | Net income | $76,227 | Consolidated Cash Flow Highlights (Fiscal Year 2020) | Account (in thousands) | Amount | | :--- | :--- | | Net cash provided by operating activities | $138,412 | | Net cash used in investing activities | $(110,541) | | Net cash used in financing activities | $(9,694) | [Notes to Consolidated Financial Statements](index=54&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail accounting policies, revenue disaggregation, leases, goodwill, and equity awards, highlighting Men's Apparel as the largest product category and the **$100 million** share repurchase program Net Sales by Geographic Region (in thousands) | Region | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | United States | $812,825 | $855,906 | $814,153 | | Foreign | $177,827 | $178,223 | $164,464 | | **Total** | **$990,652** | **$1,034,129** | **$978,617** | Sales by Product Category (% of Merchandise Sales) | Category | FY 2020 | FY 2019 | FY 2018 | | :--- | :--- | :--- | :--- | | Men's Apparel | 39% | 39% | 41% | | Hardgoods | 19% | 13% | 11% | | Accessories | 17% | 17% | 17% | | Footwear | 13% | 18% | 17% | | Women's Apparel | 12% | 13% | 14% | - As of January 30, 2021, the company had total operating lease liabilities with a present value of **$313.1 million**[372](index=372&type=chunk) - In fiscal 2020, the company repurchased **694,000 shares** of its common stock for a total cost of **$13.4 million**[382](index=382&type=chunk)[383](index=383&type=chunk) ```

Zumiez Inc. (NASDAQ:ZUMZ) Q4 2020 Results Conference Call March 11, 2021 5:00 PM ET Company Participants Rick Brooks - Chief Executive Officer Chris Work - Chief Financial Officer Conference Call Participants Janine Stichter - Jefferies Sharon Zackfia - William Blair Jeff Van Sinderen - B. Riley Jonathan Komp - Baird Mitch Kummetz - Pivotal Research Operator Good afternoon, ladies and gentlemen, and welcome to the Zumiez, Inc. Fourth Quarter Fiscal 2020 Earnings Conference Call. At this time, all participan ...

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED OCTOBER 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission file number 000-51300 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ZUMIEZ INC. (Exact name of registrant as specified in its charter) Washington 91-1040022 (State or other jurisdiction of (I.R.S. Employer incorporation or organizati ...

Zumiez Inc. (NASDAQ:ZUMZ) Q3 2020 Results Earnings Conference Call December 3, 2020 5:00 PM ET Company Participants Rick Brooks - Chief Executive Officer Chris Work - Chief Financial Officer Conference Call Participants Janine Stichter - Jefferies Sharon Zackfia - William Blair Jeff Van Sinderen - B. Riley Jonathan Komp - Baird Mitch Kummetz - Pivotal Research Operator Good afternoon, ladies and gentlemen. And welcome to the Zumiez Inc. third quarter fiscal 2020 earnings conference call. At this time, all p ...

Zumiez, Inc. (NASDAQ:ZUMZ) Q2 2020 Results Conference Call September 10, 2020 5:00 PM ET Company Participants Rick Brooks - CEO Chris Work - CFO Conference Call Participants Sharon Zackfia - William Blair Janine Stichter - Jefferies Jeff Van Sinderen - B. Riley Mitch Kummetz - Pivotal Research Steven Nowotarski - Baird Operator Good afternoon, ladies and gentlemen. And welcome to the Zumiez Inc. Second Quarter Fiscal 2020 Earnings Conference Call. At this time, all participants are in listen-only mode. We ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Washington 91-1040022 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) FORM 10-Q 4001 204th Street SW, Lynnwood, WA 98036 (Address of principal executive offices) (Zip Code) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Registrant's telephone number, including area code: (425) 551-1500 FOR THE QUARTERLY PERIOD ENDED AUGUST 1, 2020 OR ☐ TRANSIT ...

Part I [Item 1. Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) This section presents unaudited interim financial statements, reflecting a significant net loss of **$21.1 million** due to COVID-19 store closures [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased from **$914.3 million** to **$861.4 million**, with shareholders' equity declining to **$431.2 million** Balance Sheet Highlights (In thousands) | Balance Sheet Highlights (In thousands) | May 2, 2020 (Unaudited) | February 1, 2020 | | :--- | :--- | :--- | | **Total Current Assets** | $375,595 | $412,588 | | Cash and cash equivalents | $63,731 | $52,428 | | Marketable securities | $153,494 | $198,768 | | Inventories | $136,354 | $135,095 | | **Total Assets** | **$861,433** | **$914,258** | | **Total Current Liabilities** | $156,881 | $159,710 | | **Total Liabilities** | **$430,279** | **$448,172** | | **Total Shareholders' Equity** | **$431,154** | **$466,086** | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Net sales fell **35.3%** to **$137.8 million**, resulting in a net loss of **$21.1 million** and **($0.84)** diluted loss per share Statement of Operations (In thousands, except per share) | Statement of Operations (In thousands, except per share) | Three Months Ended May 2, 2020 | Three Months Ended May 4, 2019 | | :--- | :--- | :--- | | Net sales | $137,772 | $212,928 | | Gross profit | $23,736 | $66,464 | | Operating (loss) profit | $(27,848) | $968 | | Net (loss) income | $(21,101) | $793 | | Diluted (loss) earnings per share | $(0.84) | $0.03 | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash used in operations was **$17.5 million**, while investing activities provided **$42.7 million** and financing used **$13.1 million** Cash Flow Summary (In thousands) | Cash Flow Summary (In thousands) | Three Months Ended May 2, 2020 | Three Months Ended May 4, 2019 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(17,542) | $9,862 | | Net cash provided by investing activities | $42,734 | $2,285 | | Net cash (used in) provided by financing activities | $(13,082) | $345 | | **Net increase in cash, cash equivalents, and restricted cash** | **$11,257** | **$12,026** | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Notes detail COVID-19's impact, including **9%** of stores open and a **$1.5 million** impairment charge, alongside revenue and repurchase data - Due to the COVID-19 pandemic, the company began closing its retail stores globally between March 16 and March 19, 2020, with only 65 of its 719 stores (**9%**) open as of May 2, 2020[18](index=18&type=chunk)[25](index=25&type=chunk) - The company recorded **$1.5 million** in impairment charges related to long-lived assets and operating lease right-of-use assets due to COVID-19 store closures[29](index=29&type=chunk) Net Sales by Geographic Region (In thousands) | Net Sales by Geographic Region (In thousands) | Three Months Ended May 2, 2020 | Three Months Ended May 4, 2019 | | :--- | :--- | :--- | | United States | $110,364 | $176,918 | | Canada | $6,173 | $11,032 | | Europe | $19,600 | $22,946 | | Australia | $1,635 | $2,032 | | **Total Net Sales** | **$137,772** | **$212,928** | - During the quarter, the company repurchased **694,000** shares of its common stock for a total cost of **$13.4 million**, at an average price of **$19.31** per share[60](index=60&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=17&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) MD&A details Q1 2020 performance, heavily impacted by COVID-19, with net sales down **35.3%** but comparable sales up **12.9%** - In response to COVID-19, the company took several actions to preserve financial liquidity, including suspending hiring, reducing operating costs, cutting capital spending, canceling inventory orders, suspending rent payments, and pausing share repurchases[83](index=83&type=chunk)[87](index=87&type=chunk) - Net sales decreased by **35.3%** to **$137.8 million**, primarily due to COVID-19 store closures, partially offset by a **12.9%** increase in comparable sales from e-commerce[85](index=85&type=chunk)[86](index=86&type=chunk) - Gross profit margin decreased by **1,400 basis points** to **17.2%**, mainly due to deleveraging fixed costs and increased web fulfillment expenses[87](index=87&type=chunk) [Results of Operations](index=18&type=section&id=Results%20of%20Operations) Net sales fell **35.3%** due to COVID-19, gross profit margin contracted to **17.2%**, leading to a **$21.1 million** net loss Key Metrics (% of Net Sales) | Key Metrics (% of Net Sales) | Q1 2020 | Q1 2019 | | :--- | :--- | :--- | | Gross Profit | 17.2% | 31.2% | | SG&A Expenses | 37.4% | 30.7% | | Operating (Loss) Profit | (20.2)% | 0.5% | | Net (Loss) Income | (15.3)% | 0.4% | - Comparable sales increased by **$15.3 million** or **12.9%**, driven by strong e-commerce sales, particularly in the hardgoods category[86](index=86&type=chunk) [Liquidity and Capital Resources](index=20&type=section&id=Liquidity%20and%20Capital%20Resources) Company maintained strong liquidity with **$217 million** cash and investments, no debt, and reduced capital expenditure plans - The company ended the quarter with **$217 million** in cash and investments and no debt[84](index=84&type=chunk) - Capital expenditure plans for fiscal 2020 were reduced to approximately **$10-11 million** from an earlier estimate of **$18-20 million**[93](index=93&type=chunk) - The company has an undrawn **$35.0 million** senior secured credit facility maturing in December 2021[98](index=98&type=chunk) [Risk Factors](index=22&type=section&id=Risk%20Factors) Key business risks include ongoing COVID-19 impacts, potential store closures, supply chain disruptions, and market competition - The COVID-19 pandemic is a major risk, with potential for continued adverse impacts from store closures, reduced consumer spending, supply chain disruptions, and macroeconomic recession[105](index=105&type=chunk)[106](index=106&type=chunk)[109](index=109&type=chunk) - The business is highly seasonal, with sales and profitability disproportionately higher in the third and fourth fiscal quarters due to holiday shopping[122](index=122&type=chunk) - Reliance on foreign manufacturers exposes the company to risks from international trade, tariffs, political instability, and public health emergencies[116](index=116&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=30&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's market risk profile has not significantly changed since the prior fiscal year-end - The company's market risk profile at May 2, 2020, has not significantly changed from the profile disclosed in its Annual Report on Form 10-K[155](index=155&type=chunk) [Item 4. Controls and Procedures](index=30&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective, with no material changes to internal controls during the quarter - Based on evaluation, the company's disclosure controls and procedures were effective as of May 2, 2020[156](index=156&type=chunk) - No material changes occurred in the company's internal control over financial reporting during the quarter[157](index=157&type=chunk) Part II [Item 1. Legal Proceedings](index=31&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in a putative class action lawsuit regarding California wage and hour laws - The company is defending a putative class action lawsuit, *Alexia Herrera v. Zumiez Inc.*, concerning California wage and hour laws[50](index=50&type=chunk)[159](index=159&type=chunk) [Item 1A. Risk Factors](index=31&type=section&id=Item%201A.%20Risk%20Factors) This section cross-references risk factors from MD&A and the Annual Report, noting no material changes - This section refers to Risk Factors in the MD&A and Annual Report on Form 10-K, with no material changes noted[160](index=160&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details common stock repurchases: **694,000** shares for **$13.4 million** under a **$100 million** program Share Repurchase Activity | Share Repurchase Activity | Value | | :--- | :--- | | Period | March 1, 2020 - April 4, 2020 | | Total Shares Purchased | 694,000 | | Average Price Paid per Share | $19.31 | | Total Cost (in thousands) | $13,417 (calculated) | | Remaining Authorization (in thousands) | $86,583 | [Item 6. Exhibits](index=32&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and XBRL financial data - Lists exhibits filed, including CEO and CFO certifications under Sarbanes-Oxley Act and XBRL financial data[163](index=163&type=chunk)

Financial Data and Key Metrics Changes - First quarter net sales decreased 35.3% to $137.8 million compared to $212.9 million in the first quarter of 2019, driven by COVID-19 impacts and store closures [25][31] - Cash and current marketable securities increased 29.3% to $217.2 million as of May 2, 2020, compared to $168 million in Q4 2019 [21] - Net loss for the first quarter was $21.1 million or $0.84 per share compared to net income of $0.8 million or $0.03 per share in the first quarter of 2019 [31] Business Line Data and Key Metrics Changes - All categories experienced total sales declines, with hard goods being the least negatively impacted [26] - E-commerce sales grew significantly, with online sales increasing by 75.9% during the store closures [26] - Comparable sales for May increased 79.6%, with open store comparable sales up 38.5% and e-commerce comparable sales up 181.6% [33] Market Data and Key Metrics Changes - North American net sales decreased 38% to $116.6 million, while other international net sales decreased 15% to $21.2 million [25] - Total May sales were down 8.6% compared to the same period in 2019, showing improvement from the first quarter decline [32] Company Strategy and Development Direction - The company is focusing on long-term strategic investments, including real estate opportunities and enhancing its omnichannel environment [16] - Plans to open approximately nine new stores in 2020, down from an initial plan of 20 stores, indicating a cautious approach to expansion [35] - The company aims to leverage its strong financial position to navigate the current retail environment and capitalize on potential market consolidation [17][66] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about emerging stronger from the crisis, citing the strength of the company's culture and brand [17] - There is significant uncertainty regarding consumer spending and the overall economic environment, leading to cautious planning for the remainder of the year [49] - The company is actively managing costs and aligning its expense structure with anticipated sales losses [34] Other Important Information - The company suspended most rent payments while negotiating with landlords for potential rent relief during store closures [9] - The company maintained full pay for full-time employees throughout the pandemic, emphasizing its commitment to its workforce [10] Q&A Session Summary Question: Observations on sales recovery and regional variations - Management noted that 87% of opened stores have comped positively, with strong performance in both indoor and outdoor centers [45] Question: Inventory leverage for back-to-school - Management expressed confidence in being able to manage inventory effectively, despite uncertainties regarding back-to-school dynamics [54] Question: Digital component profitability - Management highlighted the integration of digital and physical sales channels, noting that both contribute similarly to overall profitability [60]