Financial Performance - Total revenue for the first quarter was $115.9 million, representing a 15% year-over-year increase[8] - Adjusted EBITDA for the quarter was $20.8 million, compared to $4.1 million in the same period last year[8] - Net loss for the quarter was $3.9 million, significantly improved from a net loss of $19.7 million in the prior year[8] - Total revenues for the three months ended April 30, 2025, were $115,936,000, a 14.5% increase from $101,217,000 in the same period of 2024[20] - Adjusted EBITDA for the three months ended April 30, 2025, was $20,816,000, compared to $4,093,000 in the same period of 2024, indicating a substantial increase[32] - Net loss for the three months ended April 30, 2025, was $3,914,000, significantly improved from a net loss of $19,722,000 in the same period of 2024[22] - The company reported a comprehensive loss of $3,479,000 for the three months ended April 30, 2025, compared to a comprehensive loss of $19,721,000 in the same period of 2024[22] Client Metrics - Average number of healthcare services clients (AHSCs) was 4,411, up 9% year-over-year[8] - Average number of healthcare services clients (AHSCs) rose to 4,411 in Q1 2025 from 4,065 in Q1 2024, reflecting a growth of 8.5%[39] - The company expects to reach approximately 4,500 AHSCs in fiscal 2026, with total revenue per AHSC projected to increase from fiscal 2025[5] Revenue per Client - Total revenue per AHSC was $26,283, an increase of 6% year-over-year[8] - Total revenue per AHSC increased to $26,283 in Q1 2025 from $24,900 in Q1 2024, marking a growth of 5.5%[39] Cash Position - Cash and cash equivalents as of April 30, 2025, were $90.9 million, up $6.7 million from January 31, 2025[8] - Cash and cash equivalents at the end of the period were $90,871,000, up from $79,527,000 at the end of the same period in 2024[24] - Net cash provided by operating activities was $14,850,000 for the three months ended April 30, 2025, compared to a cash outflow of $721,000 in the same period of 2024[24] - The company had no borrowings outstanding under its credit facility as of April 30, 2025, providing additional capital flexibility for growth opportunities[6] Revenue Outlook - The company maintains its revenue outlook for fiscal 2026, expecting revenue between $472 million and $482 million[4] - Adjusted EBITDA outlook for fiscal 2026 has been updated to a range of $85 million to $90 million, up from a previous range of $78 million to $88 million[5] Payment Metrics - Patient payment volume for Q1 2025 reached $1,314 million, up from $1,166 million in Q1 2024, representing an increase of approximately 12.7%[42] - Payment facilitator volume percentage increased to 82% in Q1 2025 from 81% in Q1 2024, indicating a slight growth in the proportion of transactions processed as a payment facilitator[42] - The company views patient payment volume as a key indicator of the health of its healthcare services clients' businesses and the shift of healthcare costs to patients[42] - Payment facilitator volume is a major driver of the company's payment processing revenue, with potential for slight decline in percentage as enterprise customer penetration increases[42] Expense Management - Total expenses decreased to $119,223,000 in Q1 2025 from $120,637,000 in Q1 2024, a reduction of 1.2%[20]

Financial Performance - Macy's, Inc. reported net sales of $4.6 billion, exceeding prior guidance, with a decrease of 5.1% compared to the first quarter of 2024[5]. - Comparable sales were down 2.0% on an owned basis and down 1.2% on an owned-plus-licensed-plus-marketplace basis, surpassing previous guidance[5]. - GAAP diluted EPS was $0.13, and adjusted diluted EPS was $0.16, both above the company's prior guidance range[5]. - Net sales for the 13 weeks ended May 3, 2025, were $4,599 million, a decrease of 5.1% compared to $4,846 million for the same period in 2024[28]. - Total revenue for the same period was $4,793 million, down from $5,000 million, reflecting a decline of 4.1%[28]. - Net income decreased to $38 million, compared to $62 million in the prior year, representing a decline of 38.7%[28]. - Basic earnings per share were $0.14, down from $0.22, a decrease of 36.4%[28]. - Adjusted diluted earnings per share for the 13 weeks ended May 3, 2025, was $0.16, down from $0.27 for the same period in 2024, a decrease of 40.7%[47]. Sales Growth - Bloomingdale's achieved comparable sales growth of 3.0% on an owned basis and 3.8% on an owned-plus-licensed-plus-marketplace basis[5]. - Bluemercury reported a 1.5% increase in comparable sales, marking its 17th consecutive quarter of growth[5]. - Comparable sales for Bloomingdale's increased by 3.0% on an owned basis for the 13 weeks ended May 3, 2025[45]. - The impact of departments licensed to third parties contributed 0.8% to comparable sales on an owned-plus-licensed-plus-marketplace basis for Macy's[45]. - The decrease in comparable sales on an owned basis for Macy's go-forward business was 1.8% for the 13 weeks ended May 3, 2025[45]. - The company experienced a decrease in comparable sales on an owned-plus-licensed basis of 0.8% for the 13 weeks ended May 3, 2025[45]. Financial Returns and Guidance - The company returned approximately $152 million to shareholders, including $51 million in cash dividends and $101 million in share repurchases[5]. - The company expects annual net sales guidance to remain unchanged at $21.0 billion to $21.4 billion for 2025[19]. - Adjusted diluted earnings per share guidance for 2025 is projected to be between $1.60 and $2.00[19]. Operational Metrics - Adjusted EBITDA was $324 million, or 6.8% of total revenue, compared to $364 million, or 7.3% of total revenue in the first quarter of 2024[11]. - Adjusted EBITDA for the 13 weeks ended May 3, 2025, was $324 million, down from $364 million for the same period in 2024, representing a decrease of 11%[46]. - Core Adjusted EBITDA for the 13 weeks ended May 3, 2025, was $308 million, down from $363 million for the same period in 2024, a decrease of 15.1%[46]. Cash Flow and Assets - Cash and cash equivalents at the end of the period were $932 million, down from $1,306 million[30]. - Total assets decreased to $16,089 million from $16,402 million, a decline of 1.9%[30]. - Total current liabilities decreased to $4,387 million from $4,524 million, a reduction of 3.0%[30]. - The company reported a net cash used by operating activities of $64 million, compared to a net cash provided of $129 million in the prior year[33]. - The company incurred $100 million in capital expenditures during the period, down from $154 million in the previous year[33]. Debt and Financial Adjustments - The company reported a loss on extinguishment of debt of $3 million for the 13 weeks ended May 3, 2025[46].

Financial Results - Dick's Sporting Goods announced preliminary financial results for Q1 2025, with unaudited figures subject to revision[5]. Merger Agreement - The company executed a merger agreement with Foot Locker, with Foot Locker becoming a wholly owned subsidiary of Dick's Sporting Goods[7]. - Dick's Sporting Goods plans to file a registration statement with the SEC regarding the merger, which will include a proxy statement for Foot Locker shareholders[15]. - DICK'S Sporting Goods and Foot Locker are involved in a proxy solicitation related to a transaction, with relevant materials to be filed with the SEC[19]. - Investors are advised to read the proxy statement/prospectus carefully before making any voting or investment decisions[19]. - Documents filed with the SEC by DICK'S Sporting Goods will be available free of charge on their investor website[19]. - Foot Locker's SEC filings will also be accessible for free on their investor website[19]. Operational Efficiencies - The merger is expected to enhance operational efficiencies and expand market reach, although specific financial benefits were not detailed[11]. - Dick's Sporting Goods and Foot Locker's combined strategies aim to leverage their respective strengths in the sporting goods market[11]. - The merger is anticipated to create a stronger competitive position in the industry, although exact projections for future performance were not provided[11]. - The transaction is part of a broader strategy to enhance shareholder value and capitalize on growth opportunities in the sporting goods sector[11]. Risks and Approvals - The company highlighted potential risks associated with the merger, including macroeconomic conditions and integration challenges[12]. - The company emphasized the importance of regulatory and shareholder approvals for the successful completion of the merger[13]. - Dick's Sporting Goods intends to keep investors informed through SEC filings and other communications regarding the merger[16].

Revenue Performance - Revenue for Q2 FY2025 was $211.0 million, a decrease of 3% year-over-year and 1% sequentially[3]. - Integrated Circuit (IC) revenue was $155.9 million, down 3% year-over-year but up 1% sequentially[3]. - Flat Panel Display (FPD) revenue was $55.1 million, down 2% year-over-year and 5% sequentially[3]. - For Q3 FY2025, revenue guidance is expected to be between $200 million and $208 million, with non-GAAP net income per diluted share between $0.35 and $0.41[4]. Net Income and Earnings Per Share - GAAP net income attributable to shareholders was $8.9 million, or $0.15 per diluted share, compared to $36.3 million, or $0.58 per diluted share in Q2 FY2024[3]. - Non-GAAP net income attributable to shareholders was $24.3 million, or $0.40 per diluted share, down from $28.7 million, or $0.46 per diluted share in Q2 FY2024[3]. - GAAP net income attributable to Photronics, Inc. shareholders for the three months ended May 4, 2025, was $8.861 million, a decrease from $42.851 million in the previous quarter[18]. - Non-GAAP net income attributable to Photronics, Inc. shareholders was $24.259 million, compared to $32.383 million in the previous quarter[18]. - GAAP diluted earnings per share attributable to Photronics, Inc. shareholders decreased to $0.15 from $0.68 in the previous quarter[18]. - Non-GAAP diluted earnings per share attributable to Photronics, Inc. shareholders was $0.40, down from $0.52 in the previous quarter[18]. Cash Flow and Investments - Cash generated from operating activities was $31.5 million, with $60.5 million invested in organic growth and $72.1 million returned to shareholders through stock repurchases[9]. - Cash, cash equivalents, and short-term investments at the end of the quarter totaled $558.4 million[9]. - The company repurchased $72 million of its stock during the quarter as part of its strategy to return cash to shareholders[2]. Foreign Exchange Impact - Foreign exchange (FX) gain/loss for the quarter was a loss of $31.111 million, compared to a gain of $18.443 million in the previous quarter[18]. - Estimated tax effects of FX gain/loss were $(8.337) million, compared to $5.152 million in the previous quarter[18]. - Estimated noncontrolling interest effects related to FX were $(7.376) million, compared to $2.823 million in the previous quarter[18]. Management Changes - The transition of CEO from Dr. Frank Lee to Mr. George Macricostas was announced, with Dr. Lee remaining involved in Asia operations[1]. Overall Financial Performance - The company experienced a decrease in non-GAAP adjustments, with effects of $(0.25) per share compared to $(0.16) in the previous quarter[18]. - Overall, the financial performance indicates a significant decline in both net income and earnings per share compared to the previous quarter[18].

Financial Performance - Total revenue for Q4 Fiscal 2025 was $1.0 billion, a decrease of 15.4% year-over-year, and a 14.1% decrease on a constant currency basis[10] - Gross profit was $631 million with a gross margin of 61.0%, down from $767 million and 62.7% in the prior year[10] - Net loss was $645 million, or $(5.44) per diluted share, compared to a net loss of $472 million, or $(4.03) per diluted share, in the prior year[10] - Total revenue for the three months ended March 29, 2025, was $1,035 million, a decrease of 15.4% compared to $1,223 million for the same period in 2024[30] - Gross profit for the three months ended March 29, 2025, was $631 million, down from $767 million in the prior year, representing a decline of 17.7%[30] - Net loss attributable to Capri for the three months ended March 29, 2025, was $645 million, compared to a net loss of $472 million for the same period in 2024, indicating a 36.6% increase in losses[30] - For the fiscal year ended March 29, 2025, total revenue was $4,442 million, down 14.1% from $5,170 million in the previous fiscal year[36] - The diluted net loss per ordinary share for the fiscal year ended March 29, 2025, was $10.00, compared to a diluted net income of $5.89 per share in the previous year[41] Revenue by Brand - Michael Kors revenue decreased by 15.6% to $694 million, while Jimmy Choo revenue decreased by 2.9% to $133 million[10] - Michael Kors revenue for the three months ended March 29, 2025, was $694 million, a decrease of 15.6% from $822 million in the same period last year[32] - Versace revenue for the three months ended March 29, 2025, was $208 million, down 21.2% from $264 million in the prior year[32] - Versace's revenue for the fiscal year ended March 29, 2025, was $821 million, a decrease of 20.3% from $1,030 million in the previous year[36] - Jimmy Choo revenue for the three months ended March 29, 2025, was $133 million, a slight decrease of 2.9% compared to $137 million in the same period in 2024[32] Future Outlook - Capri Holdings expects total revenue for Fiscal 2026 to be approximately $3.3 to $3.4 billion, with an operating income around $100 million[16] - The company anticipates diluted earnings per share for Fiscal 2026 to be approximately $1.20 to $1.40[16] - The company aims to grow Michael Kors to $4 billion in revenue and Jimmy Choo to $800 million over time, while restoring operating margin to the double-digit range[4] Cash Flow and Assets - Cash flow from operating activities for Fiscal 2025 was $281 million, resulting in free cash flow of $153 million after capital expenditures of $128 million[10] - Net inventory as of March 29, 2025, was $869 million, reflecting a 1% increase compared to the prior year[10] - Total current assets decreased to $1,521 million as of March 29, 2025, from $1,608 million as of March 30, 2024, reflecting a decline of 5.4%[28] - Total liabilities decreased to $4,841 million as of March 29, 2025, from $5,089 million as of March 30, 2024, a reduction of 4.9%[28] Operational Changes - The number of retail stores decreased to 1,158 as of March 29, 2025, down from 1,239 as of March 30, 2024, representing a decline of 6.5%[34] - The operating margin for Capri was (11.2)% for the three months ended March 29, 2025, compared to (44.4)% in the same period last year, showing improvement[32] - The operating margin for the three months ended March 29, 2025, was -11.2%, compared to 7.5% in the same period last year[38] Transformation Initiatives - The company is undergoing a multi-year ERP implementation to standardize finance IT applications across its organization[38] - The Capri transformation program aims to improve operational effectiveness and efficiency, with a focus on digital capabilities and shared platforms across brands[41] - The majority of operational and IT projects were paused during Fiscal 2024, with reassessment planned for Fiscal 2026[41] - The Capri transformation program aims to enhance operational effectiveness and efficiency through multi-year initiatives across various operational aspects, including supply chain and digital capabilities[46][48] Previous Fiscal Year Performance - For the fiscal year ended March 30, 2024, gross profit was $3,339 million, while operating expenses totaled $3,580 million, leading to a total operating loss of $241 million and an operating margin of (4.7)%[48] - The net loss attributable to Capri for the three months ended March 30, 2024, was $472 million, translating to a diluted net loss per ordinary share of $(4.03)[44] - For the fiscal year ended March 30, 2024, the net loss attributable to Capri was $229 million, with a diluted net loss per ordinary share of $(1.96)[48] - The company incurred foreign currency losses of $21 million in the three months ended March 30, 2024, and $37 million for the fiscal year ended March 30, 2024[44][48] - Asset impairment charges primarily related to the impairment of goodwill and intangible assets for the Jimmy Choo and Versace brands[44][48] Share Information - The weighted average diluted ordinary shares outstanding were 117,156,327 for the three months ended March 30, 2024, and 117,014,420 for the fiscal year ended March 30, 2024[44][48]

Financial Performance - Net sales totaled $963.0 million, down 5%, impacted by short cycle order softness and longer delivery times for project-related orders [3]. - Net loss of $5.1 million with a net margin of (0.5%), including $22.1 million in non-cash pension settlement costs and $10.3 million related to the pending acquisition of Kito Crosby [3]. - Adjusted EPS for Q4 FY 25 was $0.60, down 20% from the previous year [5]. - Net sales for the year ended March 31, 2025, decreased by 5.0% to $963.0 million from $1,013.5 million in the previous year [18]. - Gross profit margin declined to 33.8% from 37.0%, with gross profit falling by 13.1% to $325.7 million [18]. - Income from operations dropped significantly by 49.1% to $54.6 million, resulting in an operating margin of 5.7% compared to 10.6% in the prior year [18]. - Net loss for the year was $5.1 million, a stark contrast to the net income of $46.6 million reported for the previous year [18]. - For the three months ended March 31, 2025, net sales were $246.9 million, down 7.0% from $265.5 million in the same period last year [20]. - The company reported a significant decline in income from operations for the quarter, down 80.6% to $4.9 million, with an operating margin of 2.0% [20]. - Average basic shares outstanding remained relatively stable at 28.7 million, with basic loss per share reported at $(0.09) compared to earnings of $0.41 in the prior year [20]. - Net income for the three months ended March 31, 2025, was $(2.684) million, compared to $11.809 million for the same period in 2024, indicating a significant decline [44]. - Adjusted EBITDA for the three months ended March 31, 2025, was $36.069 million, down from $42.977 million in the prior year, reflecting a decrease of approximately 16.5% [44]. - Net sales for the three months ended March 31, 2025, were $246.889 million, a decrease of 7% from $265.504 million in the same period of 2024 [44]. - The net income margin for Q1 2025 was (1.1)%, compared to a positive margin of 4.4% in Q1 2024, highlighting a shift to a loss position [44]. - Adjusted EBITDA margin for Q1 2025 was 14.6%, down from 16.2% in Q1 2024, indicating a decline in operational efficiency [44]. Orders and Backlog - Record orders reached $1.0 billion, an increase of 3%, with an 8% growth in project-related business and a 19% increase in precision conveyance [3]. - Backlog increased to $322.5 million, up $41.7 million or 15% [3]. - Backlog increased to $322.5 million as of March 31, 2025, up from $296.5 million at December 31, 2024, representing an increase of 8.4% [31]. - Long-term backlog as a percentage of total backlog rose to 59.0% from 56.0% year-over-year [31]. Cash Flow and Assets - Net cash provided by operating activities was $35.6 million for the three months ended March 31, 2025, compared to $11.4 million in the previous quarter [31]. - Free Cash Flow for the three months ended March 31, 2025, was $29.5 million, significantly higher than $6.2 million in the previous quarter [31]. - Total assets decreased to $1.74 billion from $1.83 billion, while total liabilities also declined to $856.7 million from $943.9 million [22][23]. Expenses and Costs - Research and development expenses decreased by 8.9% to $23.9 million, representing 2.5% of net sales [18]. - Acquisition deal and integration costs amounted to $11.014 million for the three months ended March 31, 2025, compared to only $3,000 in the same period last year [44]. - The company incurred $3.161 million in costs related to the startup of a new factory in Monterrey, MX, for the three months ended March 31, 2025 [44]. - Interest and debt expense for Q1 2025 was $8.141 million, slightly down from $9.169 million in Q1 2024 [44]. Strategic Initiatives - The acquisition of Kito Crosby is anticipated to enhance the company's product offerings and geographic reach, with closing expected later in the calendar year [6][7]. - The company plans to allocate capital to pay down debt while maintaining consistent dividend payments [8]. - The company is actively working to mitigate tariff impacts through supply chain adjustments and pricing strategies [2]. Dividends - The company declared dividends of $0.28 per common share, consistent with the previous year [18].

Financial Results Announcement - Smith-Midland Corporation announced its financial results for the year ended December 31, 2024, on May 27, 2025[4] - The press release detailing the financial results is attached as Exhibit 99.1[5] Company Information - The company is registered under the NASDAQ trading symbol SMID[3]

Business Performance and Growth - Xcel Brands generated over $5 billion in retail sales via live streaming in interactive television and digital channels[15]. - The Judith Ripka Brand has shown continual quarterly sequential and year-over-year revenue growth since its launch on JTV in October 2023[35]. - The C Wonder Brand performed well in its launch year and is expected to continue increasing retail sales volume in 2025 and beyond[35]. - The company plans to continue its growth strategy through organic growth, developing new brands, and acquiring strategically important brands[33][35]. - The company expects growth through expansion of licensing activities and social media e-commerce platforms, including ORME[114]. Brand Portfolio and Licensing - The company launched the Longaberger Brand on ORME and introduced the TowerHill by Christie Brinkley and LB70 by Lloyd Boston brands in 2024[19][34]. - Xcel's brand portfolio includes Halston, Ripka, C Wonder, TowerHill, LB70, Longaberger, and Isaac Mizrahi, among others[25]. - Net licensing revenue from Qurate accounted for approximately 44% of total net revenue for the year ended December 31, 2024, compared to 34% for 2023[47]. - The Halston Master License generated net licensing revenue of approximately 31% of total net revenue for the year ended December 31, 2024, up from 9% in 2023[50]. - The Halston Master License has a term of 25 years, including an initial five-year period followed by a 20-year period[48]. Financial Condition and Risks - The company incurred net losses of approximately $22.6 million and $22.2 million for the years ended December 31, 2024 and 2023, respectively, with an accumulated deficit of approximately $76.2 million as of December 31, 2024[77]. - The company may require significant additional cash to satisfy working capital requirements and expand operations, which could limit growth potential[76]. - The company has a dependency on a limited number of licensees for revenue, which poses a risk if any of these licensees face financial difficulties[90]. - The company is subject to risks related to its debt obligations, which could impair liquidity and financial condition if not managed properly[79]. - The company has identified material weaknesses in its internal controls over financial reporting as of December 31, 2024, and is developing a remediation plan[85]. Market Environment and Competition - The retail environment is changing, with major retailers consolidating and potentially reducing purchases from the company, impacting sales[112]. - Intense competition in the apparel, fashion, and jewelry industries may lead to pricing pressures and reduced profit margins, impacting the company's sales and profitability[126][128]. - The company faces risks from potential economic downturns, which could adversely affect consumer spending and overall business performance[169]. Operational Challenges - The company is subject to various federal, state, and local regulations, and believes it is in compliance with all applicable laws[68]. - The company faces numerous risks associated with acquisitions, joint ventures, and collaborations, including unanticipated costs and integration challenges[120]. - The company relies significantly on information technology systems, and any failure or security lapse could have a material adverse effect on its operations[185]. - The company has experienced cybersecurity incidents, including an unsuccessful ransomware attack in February 2024, which could disrupt business operations[188]. Employee and Management - The Company had 21 employees as of December 31, 2024, and values its relationship with its employees[67]. - The company is dependent on key executives, including the CEO, for implementing business plans and growth strategies[118]. Stock and Shareholder Matters - As of April 5, 2025, the combined voting power of the company's directors and executive officers was approximately 40% of its voting securities, allowing management significant influence over shareholder matters[143]. - The company does not anticipate paying cash dividends on its common stock in the foreseeable future, planning instead to retain earnings for operations and acquisitions[163]. - The issuance of shares upon exercise of outstanding warrants and options could substantially dilute existing stockholders' percentage ownership[160]. Regulatory and Economic Factors - Changes in U.S. and foreign trade regulations, including tariffs, could have a material adverse effect on the company's operations and financial condition[174]. - The company is subject to changes in U.S. and foreign government administrative policy, which could adversely affect its business and financial condition[176]. - Changes in effective tax rates could adversely affect the company's results, particularly due to the 2017 Tax Cuts and Jobs Act, which may increase taxable income[180]. Real Estate and Lease Agreements - The company has entered into a lease agreement for approximately 12,000 square feet of office space in New York, effective February 29, 2024, expiring in 2031[206]. - The company currently leases approximately 29,600 square feet of office space at a former location, with the lease expiring on October 30, 2027, and has subleased this space to a third party[207].

Revenue and Profitability - Subscription revenue for the three months ended April 30, 2025, was $673 million, a 12% increase from $603 million in the same period of 2024[117] - Total revenue for the same period was $688 million, up from $617 million, reflecting a 12% year-over-year growth[117] - The gross profit margin improved to 77% for the three months ended April 30, 2025, compared to 76% in the prior year[119] - Operating income for the three months ended April 30, 2025, was $39 million, a significant improvement from an operating loss of $47 million in the same period of 2024[117] - The company reported a net income of $62 million for the three months ended April 30, 2025, compared to a net loss of $40 million in the same period of 2024[117] - Subscription revenue constituted approximately 98% of total revenue for the three months ended April 30, 2025[119] - Gross profit for the same period was $533 million, representing a 14% increase from $469 million year-over-year[125] - Subscription gross margin improved to 80% from 78% year-over-year, driven by improved spend efficiency[126] Customer Metrics - The dollar-based net retention rate was 106% as of April 30, 2025, indicating strong customer retention and expansion[123] - The number of customers with an annual contract value above $100,000 increased by 7% year-over-year[123] - As of April 30, 2025, the number of customers with annual contract value above $100,000 increased to 4,870 from 4,550 in 2024[145] - The dollar-based net retention rate decreased to 106% from 111% year-over-year, impacted by the macroeconomic environment[145] Expenses and Costs - The cost of subscription revenue was $136 million, resulting in a gross margin of 80% for subscription services[117] - For the three months ended April 30, 2025, total cost of revenue increased to $155 million, up 6% from $148 million in the same period of 2024[125] - Research and development expenses decreased to $154 million, down 6% from $163 million, primarily due to a reduction in stock-based compensation[131] - Sales and marketing expenses remained flat at $237 million, with a decrease in percentage of revenue from 38% to 34%[133] - General and administrative expenses decreased to $103 million, down 11% from $117 million, attributed to reduced stock-based compensation and legal settlement costs[135] Cash Flow and Investments - As of April 30, 2025, the company had cash, cash equivalents, and short-term investments totaling $2,725 million for working capital and potential acquisitions[155] - For the three months ended April 30, 2025, net cash provided by operating activities was $241 million, an increase of $22 million compared to the same period in 2024[166] - Cash used in investing activities during the three months ended April 30, 2025, was $120 million, a decrease from $194 million in the same period in 2024[167] - Cash used in financing activities was $45 million for the three months ended April 30, 2025, an increase of $8 million compared to the same period in 2024[168] Debt and Financing - In fiscal 2025, the company repurchased $42 million principal amount of the 2025 Notes for $40 million in cash, and $258 million principal amount of the 2026 Notes for $240 million in cash, resulting in an aggregate gain on early extinguishment of debt of $19 million[159] - The company issued the 2025 Notes with a principal amount of $1,060 million, of which $510 million remains outstanding as of April 30, 2025[183] - The 2026 Notes have a principal amount of $1,150 million, with $350 million remaining outstanding as of April 30, 2025[184] - The company continues to assess its capital structure and may seek additional equity or debt financing in the future[160] Market and Competitive Landscape - The company experienced revenue growth rates of 43%, 22%, and 15% during fiscal years 2023, 2024, and 2025, respectively[196] - The company incurred net losses of $355 million and $815 million in fiscal years 2024 and 2023, respectively, despite achieving profitability in fiscal 2025[204] - The company faces intense competition, particularly from larger, well-established companies, with Microsoft identified as a principal competitor[201] - The company’s revenue growth is dependent on retaining existing customers and expanding commercial relationships, which may fluctuate due to various factors[206] - The company may experience quarterly fluctuations in results due to demand variability, customer retention, and competitive landscape changes[208] Operational Risks and Challenges - The company has faced cybersecurity incidents in the past, which have harmed its reputation and financial results[195] - Economic conditions, such as inflation and interest rates, may adversely impact demand for the company’s solutions, affecting revenue[195] - The company anticipates increased operating expenses in future periods, which may not be offset by revenue growth, potentially harming financial results[198] - The company faces challenges in expanding operations internationally, including compliance with varying legal and regulatory requirements[218] - The company may need to adjust pricing strategies in response to inflation, interest rates, and competitive pressures[230] Compliance and Regulatory Issues - Compliance with evolving privacy and data security regulations may impose additional burdens and costs, potentially limiting service adoption[247] - The company has attained multiple privacy certifications, including the Privacy Recognition for Processors and the European Union Cloud Code of Conduct, Level 2, which are essential for retaining and attracting customers[255] - Increasing global data protection laws may raise compliance costs and expose the company to greater enforcement risks, potentially impacting business operations[258] - Non-compliance with data protection obligations can trigger significant fines and penalties, leading to increased resource expenditure for compliance[260] Technology and Security - The company has implemented various security measures, but these may not be sufficient to prevent all cybersecurity threats[239] - The company relies on third-party service providers for technology infrastructure, which may lead to service interruptions if these providers fail to meet capacity requirements[236] - The company must ensure its solutions integrate with various operating systems and platforms; failure to do so may reduce competitiveness and harm results[265] - The company is investing in expanding its AI capabilities, including the deployment and improvement of existing machine learning and AI technologies, as well as developing new product features using generative AI[273] Intellectual Property - The company faces risks related to intellectual property ownership and licensing rights surrounding AI technologies, which may require additional investment in proprietary datasets and machine learning models[274] - The company relies on a combination of patents, copyrights, trademarks, and trade secret laws to protect its proprietary rights, but these protections may be inadequate[275] - The company may incur significant costs related to monitoring and enforcing its intellectual property rights, which could distract management and impair its competitive position[277]

Financial Performance - Net sales for the three months ended May 4, 2025, increased to $39,856 million, up from $36,418 million in the same period last year, representing a growth of 6.7%[20] - Gross profit for the same period was $13,459 million, compared to $12,433 million, reflecting an increase of 8.2%[20] - Operating income for Q1 2025 was $5,133 million, slightly up from $5,079 million in Q1 2024, indicating a growth of 1.1%[20] - Net earnings decreased to $3,433 million from $3,600 million year-over-year, a decline of 4.6%[20] - Basic earnings per share for Q1 2025 was $3.46, down from $3.64 in Q1 2024, a decrease of 4.9%[20] Assets and Liabilities - Total assets increased to $99,157 million as of May 4, 2025, compared to $96,119 million at February 2, 2025, a rise of 3.2%[17] - Total liabilities rose to $91,202 million from $89,479 million, reflecting an increase of 1.9%[17] - Total lease liabilities increased to $12,051 million as of May 4, 2025, compared to $11,928 million as of February 2, 2025[49] - Goodwill increased to $19,568 million as of May 4, 2025, from $19,475 million at the end of the previous quarter, reflecting recent acquisitions[51] Cash Flow and Capital Expenditures - Cash and cash equivalents at the end of the period were $1,369 million, down from $4,264 million at the beginning of the period, a decrease of 67.8%[27] - Net cash provided by operating activities for Q1 2025 was $4,325 million, compared to $5,497 million in Q1 2024, a decline of 21.3%[27] - The company reported capital expenditures of $806 million for the quarter, slightly down from $847 million in the same period last year[27] - Cash flow from operations was $4.3 billion, used to pay $2.3 billion in dividends, repay $1.1 billion of long-term debt, and fund $806 million in capital expenditures[79] - The company plans to invest approximately $4 billion in capital expenditures for fiscal 2025, focusing on customer experience and technology improvements[110] Sales and Revenue Segments - Net sales for the Primary segment increased to $37,287 million for the three months ended May 4, 2025, compared to $36,418 million for the same period in 2024, representing a growth of 2.4%[40] - The cost of sales for the Primary segment was $24,384 million, up from $23,985 million, indicating an increase of 1.7% year-over-year[40] - Operating income for the Primary segment was $5,046 million, slightly down from $5,079 million, reflecting a decrease of 0.6%[40] - Net sales in the U.S. reached $37,224 million, a significant increase from $33,569 million, marking a growth of 10.0%[44] - Net sales from products amounted to $38,512 million, compared to $35,078 million, showing an increase of 6.9%[45] - Online sales represented 15.5% of net sales in Q1 fiscal 2025, increasing by 10.9% compared to Q1 fiscal 2024, with an 8.3% increase on a comparable week basis[92] Shareholder Returns and Stock Activity - The company has approximately $11.7 billion remaining from a $15.0 billion share repurchase authorization as of May 4, 2025[64] - The company purchased a total of 323,001 shares in the first quarter of fiscal 2025 at an average price of $357.69 per share[135] - The Board of Directors approved a $15.0 billion share repurchase authorization in August 2023, which does not have a prescribed expiration date[136] - The company has not resumed share repurchase activity as of May 4, 2025, after pausing in March 2024[136] Operational Metrics - The company's inventory turnover ratio was 4.3 times at the end of the first quarter of fiscal 2025, down from 4.5 times in the same period of fiscal 2024[78] - Comparable sales decreased by 0.3% in fiscal 2025, while customer transactions increased by 2.1% to 394.8 million[87] - Total comparable sales decreased by 0.3% in Q1 fiscal 2025, reflecting a 0.5% decrease in comparable customer transactions[94] Expenses and Profitability - SG&A expenses rose by $863 million, or 12.9%, to $7.5 billion in Q1 fiscal 2025, representing 18.9% of net sales[98] - Gross profit increased by 8.3% to $13.5 billion in Q1 fiscal 2025, with a gross profit margin of 33.8%, down from 34.1% in Q1 fiscal 2024[96] - Diluted earnings per share decreased to $3.45 in Q1 fiscal 2025 from $3.63 in Q1 fiscal 2024, primarily due to lower net earnings[102] Regulatory and Compliance - The company reported approximately $1.5 million in penalties paid to the EPA related to a civil consent decree, with expectations to recoup additional amounts from fines levied against third-party installers[132] - The company expects the civil consent decree with the EPA to be terminated after the stipulated penalties are resolved[132] - The company evaluated its disclosure controls and procedures and concluded they were effective as of May 4, 2025[125] Business Initiatives - The company is undergoing a business transformation initiative, including upgrading accounting and finance systems, with plans to continue migrating additional processes over the next few years[126] - The company completed the acquisition of SRS for $18.0 billion, primarily funded through commercial paper borrowings and long-term debt issuance[72] - The company acquired SRS, a leading residential specialty trade distribution company, in June 2024, which is expected to enhance market presence[39]