Restructuring

6 Months Ended

Mar. 29, 2024

Restructuring charges recorded as operating expenses in our unaudited interim condensed consolidated statements of operations represent costs associated with separate individual restructuring plans implemented in various fiscal periods. The extent of our costs arising as a result of these actions, including fluctuations in related balances between fiscal periods, is based on the nature of activities under the various plans.

Fiscal 2023 Restructuring Events. In September 2023, we initiated a restructuring plan with the purpose of focusing our resources on our highest strategic priorities. In connection with this plan, we recorded an expense in the fourth quarter of fiscal 2023 of $13.4 million in severance and other related benefits and an impairment loss of $16.9 million related primarily to internally developed software for projects we are no longer pursuing. In continuation with this plan, we recorded an expense in the first quarter of fiscal 2024 of $7.4 million in severance and other related benefits. Cash payment of the severance and other termination benefits were substantially completed by the end of the second quarter of fiscal 2024. These activities are expected to result in estimated gross pre-tax operating income savings of approximately $40 million to $45 million within fiscal 2024. The impact of these estimated savings on our operating expenses will be mostly offset by increased investment in our strategic priorities and the effects of inflation on our remaining expenses.

In June 2023, we implemented a focused restructuring plan, primarily consisting of workforce reductions and facility consolidations to improve execution in alignment with our strategy and to reduce our cost structure through improved utilization of our global infrastructure. As a result of these events, we recorded expense in the third quarter of fiscal 2023 of $10.9 million in severance and other related benefits and expense of $6.9 million related to a facility consolidation in New York, NY. Actions and expenses related to this plan were substantially completed by the end of the second quarter of fiscal 2024. These activities are expected to result in estimated gross pre-tax operating income savings of approximately $20 million to $25 million within fiscal 2024. The impact of these estimated savings on our operating expenses will be mostly offset by increased investment in our strategic priorities and the effects of inflation on our remaining expenses.

We recorded a benefit of $2.5 million in the second quarter of fiscal 2024 primarily due to a true-up of estimated restructuring expenses.

The table presented below summarizes the changes in our restructuring accruals (in thousands):


	Severance		Leased facility exit costs and other costs and adjustments		Total
Balance at September 30, 2022	$	5,781	$	—	$	5,781
Restructuring charges	23,943		23,118		47,061
Cash payments and adjustments	(9,372)		(16,225)		(25,597)
Non-cash adjustment for leased facility exit costs	—		(6,893)		(6,893)
Balance at September 29, 2023	$	20,352	$	—	$	20,352
Restructuring charges	7,513		(3,917)		3,596
Cash payments and adjustments	(22,514)		3,917		(18,597)

Balance at March 29, 2024	$	5,351	$	—	$	5,351

The fiscal 2023 activities primarily related to our fiscal 2023 restructuring plans with the purpose of focusing our resources on our highest strategic priorities and to reduce our cost structure through improved utilization of our global infrastructure.

Accruals for restructuring charges/(credits) incurred for the restructuring plan described above are included within accrued liabilities in our unaudited interim condensed consolidated balance sheets, while restructuring charges are included within restructuring charges in our unaudited interim condensed consolidated statements of operations.