Zumiez(ZUMZ) - 2026 Q1 - Quarterly Report

Part I. Financial Information Condensed Consolidated Financial Statements 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 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 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 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 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] Condensed Consolidated Statements of Cash Flows 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 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] 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] - 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] Management's Discussion and Analysis of Financial Condition and Results of Operations 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] - 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] - 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] - 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] - 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] Quantitative and Qualitative Disclosures About Market Risk 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] Controls and Procedures 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] - 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] Part II. Other Information Legal Proceedings 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][41] Risk Factors 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] Unregistered Sales of Equity Securities and Use of Proceeds 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 The company reports no defaults upon senior securities during the period - None[156] Mine Safety Disclosures This section is not applicable to the company's business operations - Not applicable[156] Other Information 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] Exhibits 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]