Core Insights - Zumiez Inc. reported a net sales increase of 3.9% to $184.3 million for the first quarter ended May 3, 2025, compared to $177.4 million in the same period last year [3] - Comparable sales for the same period increased by 5.5%, with North America showing a stronger performance at 7.4% [1][3] - The company experienced a net loss of $14.3 million, or $0.79 per diluted share, an improvement from a net loss of $16.8 million, or $0.86 per diluted share, in the prior year [3][5] Financial Performance - The first quarter's gross profit margin improved to 30.0% from 29.3% year-over-year, while selling, general and administrative expenses increased to 40.8% of sales [15] - The company had cash and current marketable securities of $101.0 million as of May 3, 2025, down from $146.6 million a year earlier, primarily due to share repurchases and capital expenditures [4] - Zumiez repurchased 1.8 million shares at an average cost of $13.82 per share, totaling $25.2 million during the first quarter [4][9] Market Outlook - The company anticipates net sales for the second quarter of fiscal 2025 to be between $207 million and $214 million, with a projected loss per share ranging from $0.09 to $0.24 [7] - Zumiez plans to open approximately 9 new stores in fiscal 2025, including 6 in North America, 2 in Europe, and 1 in Australia [8] Strategic Initiatives - The CEO highlighted the company's efforts to diversify its North American supply chain to reduce exposure to China amid ongoing trade negotiations [5] - The company aims to introduce new and unique products to drive demand while controlling costs to improve margins, especially in international markets where sales have been challenging [5]

[Part I. Financial Information](index=3&type=section&id=Part%20I.%20Financial%20Information) [Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements) The company's unaudited interim statements show a reduced net loss of $14.3 million and a decrease in total assets to $599.1 million [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to $599.1 million, primarily due to a reduction in cash and shareholders' equity from share repurchases Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | May 3, 2025 (Unaudited) | February 1, 2025 | | :--- | :--- | :--- | | **Total current assets** | $281,190 | $322,385 | | Cash and cash equivalents | $62,519 | $112,668 | | Inventories | $149,864 | $146,648 | | **Total assets** | **$599,100** | **$634,881** | | **Total current liabilities** | $146,875 | $155,514 | | **Total liabilities** | **$300,622** | **$305,904** | | **Total shareholders' equity** | **$298,478** | **$328,977** | [Condensed Consolidated Statements of Loss](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Loss) Net sales grew 3.9% to $184.3 million, leading to a reduced quarterly net loss of $14.3 million Consolidated Statements of Loss (in thousands, except per share amounts) | Metric | Three Months Ended May 3, 2025 | Three Months Ended May 4, 2024 | | :--- | :--- | :--- | | Net sales | $184,343 | $177,388 | | Gross profit | $55,315 | $51,899 | | Operating loss | $(19,872) | $(20,155) | | Net loss | $(14,330) | $(16,780) | | Diluted loss per share | $(0.79) | $(0.86) | [Condensed Consolidated Statements of Comprehensive Loss](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Loss) Comprehensive loss improved significantly to $7.3 million, driven by positive foreign currency translation adjustments Consolidated Statements of Comprehensive Loss (in thousands) | Metric | Three Months Ended May 3, 2025 | Three Months Ended May 4, 2024 | | :--- | :--- | :--- | | Net loss | $(14,330) | $(16,780) | | Foreign currency translation | $6,614 | $(895) | | **Comprehensive loss** | **$(7,298)** | **$(17,778)** | [Condensed Consolidated Statements of Changes in Shareholders' Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Shareholders%27%20Equity) Shareholders' equity declined by $30.5 million, mainly due to a $25.2 million share repurchase and the quarterly net loss - The company repurchased 1,808 thousand shares of its common stock for a total of **$25.2 million** during the quarter[15](index=15&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash decreased by $49.7 million, driven by cash used in operating, investing, and financing activities Summary of Cash Flows (in thousands) | Cash Flow Activity | Three Months Ended May 3, 2025 | Three Months Ended May 4, 2024 | | :--- | :--- | :--- | | Net cash used in operating activities | $(22,084) | $(18,577) | | Net cash (used in) provided by investing activities | $(4,188) | $7,997 | | Net cash (used in) provided by financing activities | $(25,029) | $228 | | **Net decrease in cash** | **$(49,693)** | **$(10,597)** | [Notes to Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) Key disclosures include store footprint, regional sales, a $2.9 million lawsuit settlement, and share repurchase activities - The company operates **730 stores** under the names Zumiez, Blue Tomato, and Fast Times across the U.S. (569), Europe (87), Canada (46), and Australia (28)[20](index=20&type=chunk) Net Sales by Geographic Region (in thousands) | Region | Three Months Ended May 3, 2025 | Three Months Ended May 4, 2024 | | :--- | :--- | :--- | | United States | $140,040 | $133,873 | | Europe | $29,292 | $29,569 | | Canada | $9,693 | $8,826 | | Australia | $5,318 | $5,120 | | **Total Net Sales** | **$184,343** | **$177,388** | - The company reached a settlement in principle for **$2,890,000** in the Seana Neihart PAGA lawsuit, subject to court approval[41](index=41&type=chunk) - On June 4, 2025, the company approved a new share repurchase program for up to **$15 million** of its common stock, expected to continue through June 30, 2026[63](index=63&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=21&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses a 3.9% sales increase, improved gross margin, higher SG&A, and future capital expenditure plans - Net sales increased **3.9% to $184.3 million**, driven by a **5.5% increase in comparable sales** attributed to higher dollars per transaction[79](index=79&type=chunk) - Gross profit as a percentage of net sales **increased by 70 basis points to 30.0%**, primarily due to leverage in store occupancy costs[80](index=80&type=chunk) - SG&A expenses increased by $3.1 million, and as a percentage of sales rose by 20 basis points, largely due to a **160 basis point impact from a $2.9 million litigation settlement**[81](index=81&type=chunk) - The company expects to spend approximately **$14.0 million to $16.0 million** on capital expenditures in fiscal 2025, mainly for opening about 9 new stores and for remodels/relocations[87](index=87&type=chunk) - On December 20, 2024, the company entered into a new **$25 million revolving credit facility** with PNC Bank, replacing its previous agreement with Wells Fargo[92](index=92&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's market risk profile remains materially unchanged from the previous fiscal year-end - The company's market risk profile has **not significantly changed** since February 1, 2025[148](index=148&type=chunk) [Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective with no material changes to internal controls - Management, including the CEO and CFO, concluded that **disclosure controls and procedures were effective** as of May 3, 2025[149](index=149&type=chunk) - There were **no changes in internal control over financial reporting** during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal controls[150](index=150&type=chunk) [Part II. Other Information](index=32&type=section&id=Part%20II.%20Other%20Information) [Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) The company notes routine litigation and refers to a $2.9 million settlement detailed in the financial statement notes - The company refers to Note 5 of the financial statements for details on litigation, which discloses a settlement in principle of **$2,890,000** for a PAGA lawsuit[152](index=152&type=chunk)[41](index=41&type=chunk) [Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors have occurred since the last Annual Report on Form 10-K - There have been **no material changes** in the risk factors from those disclosed in the Annual Report on Form 10-K for the year ended February 1, 2025[153](index=153&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company details the completion of its $25 million share repurchase program during the quarter Issuer Purchases of Common Stock (in thousands, except price per share) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Dollar Value of Shares that May Yet Be Repurchased Under the Plans | | :--- | :--- | :--- | :--- | | Feb 2 - Mar 1, 2025 | — | $— | $— | | Mar 2 - Apr 5, 2025 | 832 | $14.59 | $13,054 | | Apr 5 - May 3, 2025 | 990 | $13.19 | $— | | **Total** | **1,822** | | | [Defaults Upon Senior Securities](index=32&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reports no defaults upon senior securities during the period - None[156](index=156&type=chunk) [Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section is not applicable to the company's business operations - Not applicable[156](index=156&type=chunk) [Other Information](index=32&type=section&id=Item%205.%20Other%20Information) No directors or officers engaged in the adoption or termination of Rule 10b5-1 trading arrangements - No directors or officers adopted, modified, or terminated a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended May 3, 2025[156](index=156&type=chunk) [Exhibits](index=33&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including officer certifications and XBRL data - The filing includes CEO and CFO certifications pursuant to Sarbanes-Oxley Act Sections 302 and 906, as well as financial data in **Inline XBRL format**[160](index=160&type=chunk)

Core Viewpoint - Zumiez Inc. is facing significant challenges in the market, with its stock price nearing a 52-week low and a notable decline of 15.4% over the past three months, prompting a reassessment by investors [1][2]. Group 1: Performance and Market Position - Zumiez has underperformed compared to the Retail - Apparel and Shoes industry, which saw a growth of 1.9%, and the S&P 500 Index, which declined by 1.2% during the same period [2]. - The company experienced a setback during the holiday season due to an unexpected drop in demand, failing to meet internal sales expectations, which raises concerns about its adaptability to market changes [5]. - Challenges in international markets, particularly in Europe, have hindered consistent profitability, indicating deeper structural issues in Zumiez's global strategy [6]. Group 2: Supply Chain and Operational Challenges - Zumiez is vulnerable to supply-chain risks, especially related to tariffs, as approximately 50% of its North American inventory is sourced from China, exposing it to tariff-related uncertainties [7]. - The company is working on diversifying its sourcing, but this may lead to higher costs or supply disruptions, which could negatively impact profitability [7]. Group 3: Strategic Focus and Future Outlook - Despite challenges, Zumiez has shown resilience through strong comparable sales growth and improved profitability in the fourth quarter of fiscal 2024, with a focus on expanding its private label business [8][9]. - The company is optimizing operations by closing underperforming stores and refining logistics, which has led to meaningful reductions in operating costs relative to sales [10]. - For fiscal 2025, Zumiez projects total sales to increase by 1-3% and comparable sales growth of 3-5%, with a focus on enhancing product margins through private-label offerings [11]. Group 4: Valuation and Investment Appeal - Zumiez is currently trading at a forward 12-month price-to-sales (P/S) multiple of 0.26X, significantly lower than the industry average of 1.75X, suggesting it is attractively priced relative to peers [12]. - The company's Value Score of A indicates its potential appeal as an investment opportunity [12]. Group 5: Summary of Strengths and Weaknesses - Zumiez is executing well on margin expansion, cost control, and private label growth, while trading at an attractive valuation [14]. - However, struggles during the holiday season, ongoing international weaknesses, and exposure to supply-chain risks raise concerns about its near-term stability [15].

Company Overview - Zumiez Inc. is a leading specialty retailer focused on apparel, footwear, accessories, and hardgoods for young men and women interested in action sports, streetwear, and unique lifestyles [3] - As of May 3, 2025, Zumiez operates 730 stores globally, with 569 in the United States, 46 in Canada, 87 in Europe, and 28 in Australia [3] - The company operates under the names Zumiez, Blue Tomato, and Fast Times, and has ecommerce platforms at zumiez.com, blue-tomato.com, and fasttimes.com.au [3] Upcoming Financial Results - Zumiez will report its fiscal 2025 first quarter results on June 5, 2025, after the stock market closes [1] - A conference call to discuss the results will take place on the same day at 5:00 p.m. ET [1] - Participants are encouraged to pre-register for the conference call and to join 15 minutes early to avoid delays [2]

Group 1 - The article emphasizes a long-only investment strategy that evaluates companies from an operational and buy-and-hold perspective, focusing on long-term earnings power and competitive dynamics rather than market-driven price actions [1] - Quipus Capital's approach suggests that most recommendations will be holds, indicating a selective buying strategy where only a small fraction of companies are deemed worthy of purchase at any given time [1] - The hold articles are intended to provide valuable information for future investors and introduce a healthy skepticism in a generally bullish market environment [1] Group 2 - The author discloses having no stock or derivative positions in the companies mentioned and has no plans to initiate any such positions in the near future [2] - The article reflects the author's personal opinions and is not influenced by any compensation from companies mentioned, aside from Seeking Alpha [2] - Seeking Alpha clarifies that past performance does not guarantee future results and that the views expressed may not represent the platform as a whole [3]

Core Insights - Zumiez Inc. (ZUMZ) reported fourth-quarter fiscal 2024 results with sales and earnings below the Zacks Consensus Estimate, showing a year-over-year decrease in sales and an increase in earnings [1][4]. Financial Performance - Quarterly earnings were 78 cents per share, missing the Zacks Consensus Estimate of 79 cents, but improved from a loss of $1.73 per share in the same quarter last year [3]. - Total net sales were $279.2 million, slightly below the Zacks Consensus Estimate of $281 million, and decreased by 0.9% from $281.8 million in the prior-year quarter [4]. - Comparable sales (comps) rose 5.9% year over year, marking the third consecutive quarter of positive growth, although it fell short of the 6% growth expected by analysts [5]. Regional and Category Performance - North America's net sales increased by 0.8% year over year to $214.2 million, while international sales declined by 6.4% to $65 million [6]. - Comps in North America increased by 7.2%, while international comps rose by 1.9%, with women's apparel showing the highest increase among product categories [7]. Margins and Costs - Gross profit increased by 4.5% year over year to $101 million, with gross margin expanding by 190 basis points to 36.2% [8]. - Selling, general and administrative (SG&A) costs decreased by 37.5% year over year to $80.9 million, representing 29% of sales [9]. Operational Highlights - Zumiez reported an operating income of $20.1 million, a significant improvement from an operating loss of $32.8 million in the previous year [10]. - As of February 1, 2025, cash and current marketable securities totaled $147.6 million, down from $171.6 million a year earlier, with no debt reported [11]. Future Outlook - For the first quarter of fiscal 2025, Zumiez anticipates total sales of $179-$183 million, indicating year-over-year growth of 1-3%, with comps expected to increase by 3-5% [16]. - The company expects total sales growth for fiscal 2025 despite the closure of 33 stores in fiscal 2024 and anticipated 20 store closures in 2025, which will negatively impact growth by $14.7 million [19]. - Capital expenditure for the year is projected to be between $14 million and $16 million [21].

Financial Data and Key Metrics Changes - Comparable sales increased by 5.9%, marking the third consecutive quarter of positive comparable sales growth [5][21] - Total sales for Q4 2024 were $279 million, which was $7 million below the midpoint of initial guidance but $2 million above the high end of revised guidance [6][20] - Operating profit more than doubled to $20 million, and EPS increased by 95% to $0.78 after adjusting for a one-time goodwill impairment charge [7][25] - For the full year, net sales were $889.2 million, an increase of 1.6% from the previous year [27][30] Business Line Data and Key Metrics Changes - Men's category maintained positive momentum, delivering growth for the fifth consecutive quarter [8] - Women's category became the largest growth category for the quarter, continuing strong results [8][23] - Footwear positively contributed for the third consecutive quarter [8] - Hard goods faced pressure due to a downturn in skate hard goods, partially offset by gains in the snow category [9] Market Data and Key Metrics Changes - North America net sales were $214.2 million, an increase of 0.8% from the previous year [22] - Comparable sales for North America were up 7.2%, marking the fourth consecutive quarter of growth [22] - Other international net sales were $65 million, down 6.4% from last year, but improved to a positive 3.7% in Q4 [15][16] Company Strategy and Development Direction - The company will focus on accelerating global top-line expansion through strategic investments [11] - Key strategies include injecting assortments with newness, expanding private label businesses, and enhancing customer engagement [12][13] - The company plans to open nine new stores in 2025, including two in Europe and one in Australia [49] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the volatility in consumer purchasing patterns and the uncertain macroeconomic environment [17] - The company is cautiously optimistic about maintaining positive momentum in comparable sales and improving top and bottom line results in Q1 2025 [41][44] - Despite store closures, management believes total sales will grow in fiscal 2025 [45] Other Important Information - The company ended the year with $146.6 million in inventory, up 13.8% compared to the previous year [36] - Cash and current marketable securities were $147.6 million, with no debt on the balance sheet [34][35] Q&A Session Summary Question: Impact of tariffs on private label business - Management discussed efforts to diversify sourcing to mitigate tariff impacts, noting that approximately 50% of North America receipts were concentrated in China [54][55][56] Question: Leverage points on EBITDA versus SG&A - Management indicated that they expect to grow sales and operating profit, with good opportunities for gross margin growth and managing SG&A expenses in line with sales [60][62] Question: Ability to grow operating margin on low single-digit comp - Management confirmed that it is possible to grow operating margin even with low single-digit comparable sales growth [67][68]

Zumiez (ZUMZ) Q4 2025 Earnings Call March 13, 2025 10:43 PM ET Company Participants Richard Brooks - CEOChristopher Work - Chief Financial Officer Conference Call Participants Mitch Kummetz - Senior Analyst Operator Good afternoon, ladies and gentlemen, and welcome to Zumie Inc. Fourth Quarter Fiscal twenty twenty four Earnings Conference Call. At this time, all participants are in a listen only mode. We will conduct a question and answer session towards the end of this conference. Before we begin, we would ...

Company Performance - Zumiez reported quarterly earnings of $0.78 per share, missing the Zacks Consensus Estimate of $0.79 per share, but showing an increase from $0.40 per share a year ago, representing an earnings surprise of -1.27% [1] - The company posted revenues of $279.16 million for the quarter ended January 2025, missing the Zacks Consensus Estimate by 0.62%, and down from $281.82 million year-over-year [2] - Over the last four quarters, Zumiez has surpassed consensus EPS estimates three times and topped consensus revenue estimates three times [2] Stock Performance - Zumiez shares have declined approximately 30.6% since the beginning of the year, compared to a decline of -4.8% for the S&P 500 [3] - The current Zacks Rank for Zumiez is 4 (Sell), indicating expectations for the stock to underperform the market in the near future [6] Future Outlook - The current consensus EPS estimate for the upcoming quarter is -$0.39 on revenues of $175.53 million, and for the current fiscal year, it is $0.78 on revenues of $905.17 million [7] - The outlook for the Retail - Apparel and Shoes industry is currently in the top 33% of over 250 Zacks industries, suggesting that the industry may positively influence stock performance [8]

Financial Performance - Fourth quarter comparable sales increased by 5.9%, while net sales decreased by 0.9% to $279.2 million compared to $281.8 million in the same quarter last year[2]. - Fourth quarter gross margin improved by 190 basis points to 36.2%, with net income rising to $14.8 million, or $0.78 per share, from a net loss of $33.5 million, or $1.73 per share, in the prior year[2][3]. - For the fiscal year ended February 1, 2025, total net sales increased by 1.6% to $889.2 million, with comparable sales up by 4.0%[3]. - The company reported a net loss of $1.7 million, or $0.09 per share, for fiscal 2024, compared to a net loss of $62.6 million, or $3.25 per share, in fiscal 2023[3][14]. - Zumiez Inc. reported a net loss of $1.713 million for the fiscal year ended February 1, 2025, compared to a net loss of $62.610 million for the previous year[18]. Cash and Investments - The company had cash and current marketable securities of $147.6 million as of February 1, 2025, down from $171.6 million a year earlier, primarily due to share repurchases and capital expenditures[4]. - Cash flows from operating activities provided $20.701 million, an increase from $14.755 million in the prior year[19]. - Net cash provided by investing activities was $32.602 million, a significant improvement from a net cash used of $8.548 million in the previous year[19]. - The ending cash, cash equivalents, and restricted cash balance was $121.529 million, up from $94.284 million at the beginning of the period[19]. - Cash paid for income taxes during the period was $2.490 million, compared to $2.065 million in the previous year[19]. Inventory and Receivables - The company experienced a decrease in inventories by $21.687 million, while receivables increased by $1.533 million[19]. Store Operations and Expansion - Zumiez operates 729 stores as of March 1, 2025, including 569 in the United States, 46 in Canada, 87 in Europe, and 27 in Australia[11]. - Zumiez plans to open approximately 9 new stores in fiscal 2025, including up to 6 in North America, 2 in Europe, and 1 in Australia[7]. Stock and Shareholder Actions - The board approved a new stock repurchase authorization of up to $25 million, expected to continue through March 31, 2026[8][9]. - Zumiez Inc. repurchased common stock amounting to $25.206 million during the fiscal year[19]. Impairments and Expenses - The company recorded an impairment of goodwill and long-lived assets totaling $1.473 million, a significant decrease from $43.904 million in the prior year[18]. - Depreciation, amortization, and accretion expenses were $22.160 million, slightly down from $22.763 million[18]. - The company reported a foreign currency transaction loss of $2.145 million, compared to a minimal loss of $25 in the previous year[18]. Future Projections - The company projects net sales for the first quarter ending May 3, 2025, to be in the range of $179 to $183 million, with expected earnings per share losses between $0.72 and $0.82[7]. - First quarter-to-date comparable sales increased by 4.3%, led by a 6.4% increase in North America, while other international comparable sales decreased by 3.7%[6].