10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 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 April 29, 2023

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM ______ TO ______

Commission File Number 001-34742

EXPRESS, INC.

(Exact name of registrant as specified in its charter)

Delaware	26-2828128
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1 Express Drive Columbus, Ohio	43230
(Address of principal executive offices)	(Zip Code)

Telephone: (614) 474-4001

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	EXPR	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.  Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☒   No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ☐    No  ☒

The number of outstanding shares of the registrant’s common stock was 74,592,956 as of May 27, 2023.

EXPRESS, INC. | Q1 2023 Form 10-Q | 1

EXPRESS, INC.

INDEX TO FORM 10-Q

FORWARD-LOOKING STATEMENTS			3
PART I		FINANCIAL INFORMATION	5
	Item 1.	Financial Statements (Unaudited)	5
		Consolidated Balance Sheets	5
		Consolidated Statements of Income and Comprehensive Income	6
		Consolidated Statements of Changes in Stockholders' Equity	7
		Consolidated Statements of Cash Flows	8
		Notes to Unaudited Consolidated Financial Statements	9
	Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	24
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	34
	Item 4.	Controls and Procedures	35
PART II		OTHER INFORMATION	35
	Item 1.	Legal Proceedings	35
	Item 1A.	Risk Factors	35
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	36
	Item 3.	Defaults Upon Senior Securities	36
	Item 4.	Mine Safety Disclosures	36
	Item 5.	Other Information	36
	Item 6.	Exhibits	37
SIGNATURES			38

EXPRESS, INC. | Q1 2023 Form 10-Q | 2

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Quarterly Report”) contains forward-looking statements within the “safe harbor” provisions of the Private Securities Reform Act of 1995 that are subject to risks and uncertainties. All statements other than statements of historical fact included in this Quarterly Report are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance, and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate,” “estimate,” “expect,” “project,” “plan,” “potential,” “intend,” “believe,” “may,” “will,” “should,” “can have,” “likely,” "continue to," and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. For example, all statements we make relating to our estimated and projected costs, expenditures, cash flows, and financial results, our plans and objectives for future operations, growth, initiatives, or strategies, plans to repurchase shares of our common stock, the expected outcome or impact of pending or threatened litigation, or our strategic partnership with WHP Global or any transactions arranged as part of that partnership, including the Bonobos acquisition, and the anticipated benefits or effects of such transactions, are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected, including:

Operational and Industry Risks

▪general economic conditions and changes in consumer spending, including as a result of recent high inflation and fears of a potential recession or instability in the financial markets and banking industry;

▪customer traffic at malls, shopping centers, and at our stores;

▪the COVID-19 pandemic has had, and may in the future have, an adverse effect on our business operations, financial condition, liquidity and cash flow;

▪competition from other retailers;

▪our dependence upon independent third parties to manufacture all of our merchandise;

▪changes in the availability and cost of raw materials, labor, and freight;

▪labor shortages;

▪supply chain disruption and increased tariffs;

▪geopolitical risks, including impacts from the ongoing conflict between Russia and Ukraine and increased tensions between China and Taiwan;

▪difficulties associated with our third-party owned distribution facilities;

▪natural disasters, extreme weather, public health issues, including pandemics, fire, and other events that cause business interruption; and

▪our reliance on third parties to provide us with certain key services for our business.

Strategic Risks

▪our ability to identify and respond to new and changing fashion trends, customer preferences, and other related factors including selling through inventory at an appropriate price;

▪fluctuations in our sales, results of operations, and cash levels on a seasonal basis and due to a variety of other factors, including our product offerings relative to customer demand, the mix of merchandise we sell, promotions, inventory levels, and sales mix between stores and eCommerce;

▪our dependence on a strong brand image;

▪our ability to adapt to changes in consumer behavior and develop and maintain a relevant and reliable omnichannel experience for our customers;

▪our ability to realize the expected strategic and financial benefits of the Bonobos acquisition;

▪our dependence upon key executive management; and

▪our ability to execute our growth strategy, including but not limited to, achieving profitable growth in our core Express business, optimizing our omnichannel platform, accelerating our growth and profitability through the WHP strategic partnership and operating with financial discipline.

Risks Related to Our Strategic Partnership with WHP

▪our ability to realize success in our strategic partnership with WHP and the potential for the relationship with WHP to divert resources away from existing operations or expose us to liabilities; and

▪our inability to realize the benefits and synergies of the strategic partnership or any transactions arranged as part of that partnership.

EXPRESS, INC. | Q1 2023 Form 10-Q | 3

Information Technology Risks

▪the failure or breach of information systems upon which we rely;

▪the increase of our employees working remotely and use of technology for work functions; and

▪our ability to protect our customer data from fraud and theft.

Financial Risks

▪our substantial lease obligations;

▪restrictions imposed on us under the terms of our current credit facility, including asset based requirements related to inventory levels, ability to make additional borrowings, and restrictions on our ability to repurchase shares of our common stock;

▪our inability to maintain compliance with covenants in our current credit facility; and

▪impairment charges on property and equipment and our right of use assets.

Legal, Regulatory and Compliance Risks

▪claims made against us resulting in litigation or changes in laws and regulations applicable to our business;

▪our inability to protect our trademarks or other intellectual property rights that may preclude the use of our trademarks or other intellectual property around the world;

▪changes in tax requirements, results of tax audits, and other factors including timing of tax refund receipts, that may cause fluctuations in our effective tax rate and operating results; and

▪our failure to maintain adequate internal controls.

Stock Ownership Risk Factors

▪our inability to pay dividends and repurchase shares;

▪our charter documents and applicable law may discourage or delay acquisition attempts;

▪our failure to regain compliance with the continued listing requirements of the New York Stock Exchange, or any future failure to meet those requirements, could result in the delisting of our common stock;

▪our shares of common stock may experience extreme volatility and purchases of our common stock could incur substantial losses;

▪our stock price may incur rapid and substantial increases or decreases that may not coincide in timing with the disclosure of news or developments affecting us;

▪potential short squeezes related to our common stock have led to, and could again lead to, extreme price volatility in shares of our common stock; and

▪information available in public media that is published by third parties, including blogs, articles, message boards and social and other media may include statements not attributable to us and may not be reliable or accurate.

We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results. For a discussion of these risks and other risks and uncertainties that could cause actual results to differ materially from those contained in our forward-looking statements, please refer to “Item 1A. Risk Factors” included elsewhere in this Quarterly Report and in our Annual Report on Form 10-K for the year ended January 28, 2023 (“Annual Report”), filed with the Securities and Exchange Commission (“SEC”) on March 31, 2023. The forward-looking statements included in this Quarterly Report are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events, or otherwise, except as required by law.

EXPRESS, INC. | Q1 2023 Form 10-Q | 4

PART I – FINANCIAL INFORMATION

ITEM 1.FINANCIAL STATEMENTS.

EXPRESS, INC.

CONSOLIDATED BALANCE SHEETS

(Amounts in Thousands, Except Per Share Amounts) (Unaudited)

	April 29, 2023		January 28, 2023
ASSETS
Current Assets:
Cash and cash equivalents	$	34,092	$	65,612
Receivables, net	17,106		12,374
Income tax receivable	1,140		1,462
Inventories	346,963		365,649
Prepaid royalty	47,146		59,565
Prepaid rent	5,762		7,744
Other	25,628		21,998
Total current assets	477,837		534,404
Right of Use Asset, Net	522,922		505,350
Property and Equipment	1,022,132		1,019,577
Less: accumulated depreciation	(894,020)		(886,193)
Property and equipment, net	128,112		133,384
Non-Current Income Tax Receivable	52,278		52,278
Equity Method Investment	166,210		166,106
Other Assets	6,342		6,803
TOTAL ASSETS	$	1,353,701	$	1,398,325
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Short-term lease liability	$	197,944	$	189,006
Accounts payable	162,369		191,386
Deferred royalty income	15,412		19,852
Deferred revenue	33,243		35,543
Accrued expenses	101,243		105,803
Total current liabilities	510,211		541,590
Long-Term Lease Liability	408,006		406,448
Long-Term Debt	179,750		122,000
Other Long-Term Liabilities	20,075		20,718
Total Liabilities	1,118,042		1,090,756
Commitments and Contingencies (Note 10)
Stockholders’ Equity:
Preferred stock – $0.01 par value; 10,000 shares authorized; no shares issued or outstanding	—		—
Common stock – $0.01 par value; 500,000 shares authorized; 99,067 shares and 99,067 shares issued at April 29, 2023 and January 28, 2023, respectively, and 74,571 shares and 73,760 shares outstanding at April 29, 2023 and January 28, 2023, respectively	990		990
Additional paid-in capital	229,468		228,633
Retained earnings	269,812		355,736
Treasury stock – at average cost; 24,496 shares and 25,307 shares at April 29, 2023 and January 28, 2023, respectively	(264,611)		(277,790)
Total stockholders’ equity	235,659		307,569
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,353,701	$	1,398,325

See Notes to Unaudited Consolidated Financial Statements.

EXPRESS, INC. | Q1 2023 Form 10-Q | 5

EXPRESS, INC.

CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(Amounts in Thousands, Except Per Share Amounts) (Unaudited)

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
Net Sales	$	383,257	$	450,785
Cost of Goods Sold, Buying and Occupancy Costs	319,464		319,285
GROSS PROFIT	63,793		131,500
Operating Expenses (Income):
Selling, general, and administrative expenses	139,348		141,093
Royalty income	(4,440)		—
Other operating income, net	(1,000)		(490)
TOTAL OPERATING EXPENSES	133,908		140,603
OPERATING LOSS	(70,115)		(9,103)
Interest Expense, Net	2,943		3,494
Other Income, Net	—		(200)
LOSS BEFORE INCOME TAXES	(73,058)		(12,397)
Income Tax Expense (Benefit)	369		(483)
NET LOSS	$	(73,427)	$	(11,914)
COMPREHENSIVE LOSS	$	(73,427)	$	(11,914)
EARNINGS PER SHARE:
Basic	$	(0.99)	$	(0.18)
Diluted	$	(0.99)	$	(0.18)
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic	73,878		67,211
Diluted	73,878		67,211

See Notes to Unaudited Consolidated Financial Statements.

EXPRESS, INC. | Q1 2023 Form 10-Q | 6

EXPRESS, INC.

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

(Amounts in Thousands) (Unaudited) 

	Common Stock									Treasury Stock
	Shares Outstanding	Par Value		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Shares	At Average Cost		Total
BALANCE, January 28, 2023	73,760	$	990	$	228,633	$	355,736	$	—	25,307	$	(277,790)	$	307,569
Net loss	—	—		—		(73,427)		—		—	—		(73,427)
Exercise of stock options and vesting of restricted stock	1,232	—		(1,036)		(12,497)		—		(1,232)	13,533		—
Share-based compensation	—	—		1,871		—		—		—	—		1,871
Repurchase of common stock	(421)	—		—		—		—		421	(354)		(354)
BALANCE, April 29, 2023	74,571	$	990	$	229,468	$	269,812	$	—	24,496	$	(264,611)	$	235,659

	Common Stock									Treasury Stock
	Shares Outstanding	Par Value		Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Shares	At Average Cost		Total
BALANCE, January 29, 2022	67,072	$	936	$	220,078	$	77,093	$	—	26,560	$	(296,799)	$	1,308
Net loss	—	—		—		(11,914)		—		—	—		(11,914)
Exercise of stock options and vesting of restricted stock	1,520	—		(5,038)		(11,935)		—		(1,520)	16,973		—
Share-based compensation	—	—		2,393		—		—		—	—		2,393
Repurchase of common stock	(570)	—		—		—		—		570	(1,890)		(1,890)
BALANCE, April 30, 2022	68,022	$	936	$	217,433	$	53,244	$	—	25,610	$	(281,716)	$	(10,103)

See Notes to Unaudited Consolidated Financial Statements.

EXPRESS, INC. | Q1 2023 Form 10-Q | 7

EXPRESS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in Thousands) (Unaudited)

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$	(73,427)	$	(11,914)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	14,405		15,172
Loss on disposal of property and equipment	—		10
Share-based compensation	1,871		2,393
Landlord allowance amortization	(58)		(157)
Changes in operating assets and liabilities:
Receivables, net	(4,732)		2,413
Income tax receivable	322		(463)
Prepaid royalty	12,419		—
Inventories	18,686		(12,454)
Deferred royalty income	(4,440)		—
Accounts payable, deferred revenue, and accrued expenses	(37,370)		(53,989)
Other assets and liabilities	(8,288)		(16,890)
NET CASH USED IN OPERATING ACTIVITIES	(80,612)		(75,879)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(8,200)		(5,142)
Costs related to WHP transaction	(104)		—
NET CASH USED IN INVESTING ACTIVITIES	(8,304)		(5,142)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under the revolving credit facility	142,250		117,000
Repayment of borrowings under the revolving credit facility	(84,500)		(37,000)
Repayment of borrowings under the term loan facility	—		(1,125)
Repurchase of common stock for tax withholding obligations	(354)		(1,890)
NET CASH PROVIDED BY FINANCING ACTIVITIES	57,396		76,985
NET DECREASE IN CASH AND CASH EQUIVALENTS	(31,520)		(4,036)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	65,612		41,176
CASH AND CASH EQUIVALENTS, END OF PERIOD	$	34,092	$	37,140

See Notes to Unaudited Consolidated Financial Statements.

EXPRESS, INC. | Q1 2023 Form 10-Q | 8

EXPRESS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

		Page
Note 1	Description of Business and Basis of Presentation	10
Note 2	Revenue Recognition	12
Note 3	Earnings Per Share	14
Note 4	Fair Value Measurements	14
Note 5	Equity Method Investment	16
Note 6	Income Taxes	18
Note 7	Leases	18
Note 8	Debt	19
Note 9	Long-Term Incentive Compensation	20
Note 10	Commitments and Contingencies	22
Note 11	Stockholders' Equity	23
Note 12	Subsequent Events	23

EXPRESS, INC. | Q1 2023 Form 10-Q | 9

NOTE 1 | DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Business Description

Express, Inc., together with its subsidiaries (“Express” or the “Company”), is a multi-brand fashion retailer whose portfolio includes Express and UpWest. The Company operates an omnichannel platform, including both physical and online stores. Grounded in a belief that style, quality and value should all be found in one place, Express is a brand with a purpose - We Create Confidence. We Inspire Self-Expression. - powered by a styling community. UpWest is an apparel, accessories and home goods brand with a purpose to Provide Comfort for People & Planet.

As of April 29, 2023, the Company operated 545 retail and factory outlet stores in the United States and Puerto Rico, the Express.com online store, the Express mobile app and the UpWest.com online store. As of April 29, 2023, the composition of Express operated stores was as follows:

	Store Count
EXPRESS
Retail stores1	337
Factory Outlet stores	195
Total Retail and Factory Outlet stores	532
UpWest	13
Total stores	545

1.As of April 29, 2023, retail store count includes 10 Express Edit stores

WHP Strategic Partnership

In the fourth quarter of 2022, Express closed the strategic partnership with WHP Global (“WHP”), a leading global brand management firm. The mutually transformative strategic partnership advances the Company's omnichannel platform which is expected to drive accelerated, long-term growth through the acquisition and operation of a portfolio of brands. In connection with the closing of this transaction in January 2023, the Company and WHP also formed a joint venture (the “Joint Venture”), intended to scale the Express brand through new domestic category licensing and international expansion opportunities. Refer to Note 5 for further discussion regarding the WHP strategic partnership.

Fiscal Year

The Company's fiscal year ends on the Saturday closest to January 31. Fiscal years are designated in the unaudited Consolidated Financial Statements and Notes, as well as the remainder of this Quarterly Report, by the calendar year in which the fiscal year commences. All references herein to the Company's fiscal years are as follows:

Fiscal Year	Year Ended	Number of Weeks
2023	February 3, 2024	53
2022	January 28, 2023	52

All references herein to “the first quarter of 2023” and “the first quarter of 2022” represent the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively.

Basis of Presentation

The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and the U.S. Securities and Exchange Commission’s Article 10, Regulation S-X and therefore do not include all of the information or footnotes required for complete financial statements. In the opinion of management, the accompanying unaudited Consolidated Financial Statements reflect all adjustments (which are of a normal recurring nature) necessary to state fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the Company's future interim periods or 2023 fiscal year. Therefore, these statements should be read in conjunction with the

EXPRESS, INC. | Q1 2023 Form 10-Q | 10

Consolidated Financial Statements and Notes thereto for the year ended January 28, 2023, included in the Annual Report.

Express, Inc., through its indirect, wholly owned subsidiaries, including Express Fashion Operations, LLC, conducts the operations of the Company and Express Fashion Investments, LLC which owns a 40% economic interest with significant influence in the Joint Venture.

Principles of Consolidation

The unaudited Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. The Company indirectly holds a 40% equity method interest in the Joint Venture, which is majority owned by WH Borrower, LLC, an affiliate of WHP. All intercompany transactions and balances have been eliminated in consolidation.

Segment Reporting    

The Company defines an operating segment on the same basis that it uses to evaluate performance internally. The Company has determined that its Chief Executive Officer is the Chief Operating Decision Maker, and that there is one operating segment. Therefore, the Company reports results as a single segment, which includes the operation of its Express and UpWest brick-and-mortar retail and outlet stores and eCommerce operations.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenue and expense during the reporting period, as well as the related disclosure of contingent assets and liabilities as of the date of the unaudited Consolidated Financial Statements. Actual results may differ from those estimates. The Company revises its estimates and assumptions as new information becomes available.

Going Concern and Management’s Plans

The Company’s revenues, results of operations and cash flows have been materially adversely impacted by negative macroeconomic factors beginning in the third and fourth quarters of 2022 and continuing into the first quarter of 2023. The persistently challenging macroeconomic and retail apparel environments, including reduced consumer spending and increased price sensitivity in discretionary categories, has significantly impacted the Company's performance. Net sales during the first quarter of 2023 decreased approximately $67.5 million compared to the first quarter of 2022 and this decline, coupled with an increase in promotional activity, drove gross margin and operating loss below the Company's expectations. For the first quarter of 2023, the Company reported a net operating loss of $70.1 million and negative operating cash flows of $80.6 million.

As of April 29, 2023, the Company was in compliance with the covenants under the agreements governing its indebtedness, however, due to the uncertainty in the Company’s business, the Company could experience material further decreases to revenues and cash flows and may experience difficulty remaining in compliance with such covenants. Refer to Note 8 for further details regarding the terms of the ABL Credit Agreement and the Revolving Credit Facility provided to the Company thereunder.

When conditions and events, in the aggregate, impact an entity's ability to continue as a going concern, management evaluates the mitigating effect of its plans to determine if it is probable that the plans will be effectively implemented and, when implemented, the plans will mitigate the relevant conditions or events.

The Company's plans are focused on improving its results and liquidity through additional expense savings and improved sales trends as we move through the balance of fiscal year 2023. The Company is committed to finding significant additional expense savings which are expected to benefit the second half of fiscal 2023 and full fiscal year 2024, and has engaged external advisors to assist in analyzing and identifying both potential margin expansion and further expense saving opportunities. Additionally, the Company has contingency plans which would further reduce or defer additional expenses and cash outlays should operations weaken beyond current forecasts. The Company believes these plans are probable of being successfully implemented, which will result in adequate cash flows to support its ongoing operations and to meet its financial covenant requirements under the agreements governing its indebtedness for at least one year following the date these financial statements are issued.

EXPRESS, INC. | Q1 2023 Form 10-Q | 11

The accompanying unaudited Consolidated Financial Statements are prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

NOTE 2 | REVENUE RECOGNITION

The following is information regarding the Company’s major product categories and sales channels:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Apparel	$	344,000	$	401,286
Accessories and other	26,193		35,478
Other revenue	13,064		14,021
Total net sales	$	383,257	$	450,785

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Retail	$	274,256	$	320,877
Outlet	95,937		115,887
Other revenue	13,064		14,021
Total net sales	$	383,257	$	450,785

Other revenue consists primarily of revenue earned from our private label credit card agreement, shipping and handling revenue related to eCommerce activity, sell-off revenue related to marked-out-of-stock inventory sales to third parties and revenue from gift card breakage.

Merchandise Sales

The Company recognizes sales for in-store purchases at the point-of-sale. Revenue related to eCommerce transactions is recognized upon shipment based on the fact that control transfers to the customer at that time. The Company has made a policy election to treat shipping and handling as costs to fulfill the contract, and as a result, any amounts received from customers are included in the transaction price allocated to the performance obligation of providing goods with a corresponding amount accrued within cost of goods sold, buying and occupancy costs in the unaudited Consolidated Statements of Income and Comprehensive Income for amounts paid to applicable carriers. Associate discounts on merchandise purchases are classified as a reduction of net sales. Net sales excludes sales tax collected from customers and remitted to governmental authorities.

Loyalty Program

The Company maintains a customer loyalty program in which customers earn points toward rewards for qualifying purchases and other marketing activities. Upon reaching specified point values, customers are issued a reward, which they may redeem on merchandise purchases at the Company’s stores or on its website. Generally, rewards earned must be redeemed within 60 days from the date of issuance. The Company defers a portion of merchandise sales based on the estimated standalone selling price of the points earned. This deferred revenue is recognized as certificates are redeemed or expire. To calculate this deferral, the Company makes assumptions related to loyalty point and certificate redemption rates based on historical experience. The loyalty liability is included in deferred revenue on the unaudited Consolidated Balance Sheets.

EXPRESS, INC. | Q1 2023 Form 10-Q | 12

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning balance loyalty deferred revenue	$	9,939	$	10,918
Net revenue recognized	(540)		(1,562)
Ending balance loyalty deferred revenue	$	9,399	$	9,356

Sales Returns Reserve

The Company reduces net sales and provides a reserve for projected merchandise returns based on prior experience. Merchandise returns are often resalable merchandise and are refunded by issuing the same payment tender as the original purchase. The sales returns reserve was $14.9 million and $9.0 million as of April 29, 2023 and January 28, 2023, respectively, and is included in accrued expenses on the unaudited Consolidated Balance Sheets. The asset related to projected returned merchandise is included in other assets on the unaudited Consolidated Balance Sheets.

Gift Cards

The Company sells gift cards in its stores, on its eCommerce website, and through third parties. These gift cards do not expire or lose value over periods of inactivity. The Company accounts for gift cards by recognizing a liability at the time a gift card is sold. The gift card liability balance was $23.7 million and $25.6 million, as of April 29, 2023 and January 28, 2023, respectively, and is included in deferred revenue on the unaudited Consolidated Balance Sheets. During the thirteen weeks ended April 29, 2023 and April 30, 2022, the Company recognized approximately $3.7 million and $4.3 million of revenue that was previously included in the beginning gift card contract liability, respectively. The Company recognizes revenue from gift cards when they are redeemed by the customer. The Company also recognizes income on unredeemed gift cards, referred to as “gift card breakage.” Gift card breakage is recognized proportionately using a time-based attribution method from issuance of the gift card to the time when it can be determined that the likelihood of the gift card being redeemed is remote and that there is no legal obligation to remit unredeemed gift cards to relevant jurisdictions. The gift card breakage rate is based on historical redemption patterns. Gift card breakage is included within the other revenue component of net sales in the unaudited Consolidated Statements of Income and Comprehensive Income.

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning gift card liability	$	25,604	$	25,066
Issuances	4,983		6,083
Redemptions	(6,100)		(7,006)
Gift card breakage	(831)		(855)
Ending gift card liability	$	23,656	$	23,288

Private Label Credit Card

The Company has an agreement with Comenity Bank (the “Bank”) to provide customers with private label credit cards (as amended, the “Card Agreement”). The term of the Card Agreement expires on December 31, 2024. Each private label credit card bears the logo of the Express brand and can only be used at the Company’s store locations and eCommerce channel. The Bank is the sole owner of the accounts issued under the private label credit card program and absorbs the losses associated with non-payment by the private label card holders and a portion of any fraudulent usage of the accounts.

Pursuant to the Card Agreement, the Company receives amounts from the Bank during the term based on a percentage of private label credit card sales and is also eligible to receive incentive payments for the achievement of certain performance targets. These funds are recorded within the other revenue component of net sales in the unaudited Consolidated Statements of Income and Comprehensive Income. The Company also receives reimbursement funds from the Bank for certain expenses the Company incurs. These reimbursement funds are

EXPRESS, INC. | Q1 2023 Form 10-Q | 13

used by the Company to fund marketing and other programs associated with the private label credit card. The reimbursement funds received related to private label credit cards are recorded within the other revenue component of net sales in the Consolidated Statements of Income and Comprehensive Income.

In connection with the Card Agreement, the Bank paid the Company a $20.0 million refundable payment which the Company recognized upon receipt as deferred revenue within other long-term liabilities in the Consolidated Balance Sheets and began to recognize into income on a straight-line basis commencing January of 2018. As of April 29, 2023, the deferred revenue balance of $4.8 million will be recognized over the remaining term of the Card Agreement within the other revenue component of net sales.

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning balance refundable payment liability	$	5,516	$	8,394
Recognized in revenue	(719)		(719)
Ending balance refundable payment liability	$	4,797	$	7,675

NOTE 3 | EARNINGS PER SHARE

The following table provides a reconciliation between basic and diluted weighted-average shares used to calculate basic and diluted earnings per share:

	Thirteen Weeks Ended
	April 29, 2023	April 30, 2022
	(in thousands)
Weighted-average shares - basic	73,878	67,211
Dilutive effect of stock options and restricted stock units	—	—
Weighted-average shares - diluted	73,878	67,211

Equity awards representing 4.3 million and 6.8 million shares of common stock were excluded from the computation of diluted earnings per share for the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively, as the inclusion of these awards would have been anti-dilutive.

Additionally, for the thirteen weeks ended April 29, 2023, equity awards representing 2.9 million shares were excluded from the computation of diluted weighted average shares because the number of shares that will ultimately be issued is contingent on the Company’s performance compared to pre-established performance goals which had not been achieved as of April 29, 2023.

NOTE 4 | FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date.

■Level 1 - Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities in active markets.

■Level 2 - Valuation is based upon quoted prices for similar assets and liabilities in active markets or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

■Level 3 - Valuation is based upon other unobservable inputs that are significant to the fair value measurement.

EXPRESS, INC. | Q1 2023 Form 10-Q | 14

Financial Assets

The following table presents the Company's financial assets, recorded in cash and cash equivalents on the unaudited Consolidated Balance Sheets, measured at fair value on a recurring basis as of April 29, 2023 and January 28, 2023, aggregated by the level in the fair value hierarchy.

	April 29, 2023
	Level 1		Level 2		Level 3
	(in thousands)
Money market funds	$	—	$	—	$	—
	January 28, 2023
	Level 1		Level 2		Level 3
	(in thousands)
Money market funds	$	47,792	$	—	$	—

The money market funds are valued using quoted market prices in active markets.

Non-Financial Assets

The Company's non-financial assets, which include fixtures, equipment, improvements, right of use assets, and an equity method investment, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur indicating the carrying value of these assets may not be recoverable, or annually in the case of indefinite-lived intangibles, an impairment test is required to be performed by the Company.

The carrying amounts reflected on the unaudited Consolidated Balance Sheets for the remaining cash, cash equivalents, receivables, prepaid expenses, and payables as of April 29, 2023 and January 28, 2023 approximated their fair values. The equity method investment is reflected at cost, and is the result of a market participant transaction with WHP whereby the Company received proceeds of $260.0 million and a 40% ownership interest in the Joint Venture in exchange for contributing certain intellectual property to the Joint Venture.

The Company reviews its equity method investment by comparing its fair value to its carrying value. If the carrying value of the investment exceeds its fair value and the loss in value is other than temporary, the investment is considered impaired and reduced to fair value, and the impairment is recognized in the period identified. Factors providing evidence of such a loss include changes in the investee's operations or financial condition, significant continuing losses, significant negative economic conditions or a significant decrease in the market value. Impairment charges are recorded in other expense (income), net in the unaudited Consolidated Statements of Income and Comprehensive Income.

Store Asset Impairment

Property and equipment, including the right of use assets, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur indicating the carrying value of these assets may not be recoverable, an impairment test is required. These events include, but are not limited to, material adverse changes in projected revenues, present cash flow losses combined with a history of cash flow losses and a forecast that demonstrates significant continuing losses, significant negative economic conditions, a significant decrease in the market value of an asset and store closure or relocation decisions. The reviews are conducted at the store level, the lowest identifiable level of cash flow.

Stores that display an indicator of impairment are subjected to an impairment assessment. Such stores are tested for recoverability by comparing the sum of the estimated future undiscounted cash flows to the carrying amount of the asset. This recoverability test requires management to make assumptions and judgments related, but not limited, to management’s expectations for future cash flows from operating the store.

▪The key assumption used in the undiscounted future store cash flow models is the sales growth rate.

An impairment loss may be recognized when these undiscounted future cash flows are less than the carrying amount of the asset group. In the circumstance of impairment, any loss would be measured as the excess of the

EXPRESS, INC. | Q1 2023 Form 10-Q | 15

carrying amount of the asset group over its fair value. Fair value of the store-related assets is determined at the individual store level based on the highest and best use of the asset group.

▪The key assumptions used in the fair value analysis may include discounted estimates of future store cash flows from operating the store and/or comparable market rents.

Impairment charges are recorded in cost of goods sold, buying and occupancy costs in the unaudited Consolidated Statements of Income and Comprehensive Income.

During the thirteen weeks ended April 29, 2023 and April 30, 2022, the Company did not recognize any impairment charges.

NOTE 5 | EQUITY METHOD INVESTMENT

The following table is a summary of the Company’s equity method investment with WHP:

	% of Ownership	Balance Sheet Location	April 29, 2023
			(in thousands)
EXP Topco, LLC.	40%	Equity Method Investment	$	166,210

The Company accounts for its 40% economic interest in the Joint Venture, through which it exercises significant influence but does not have control over the investee, under the equity method. Under the equity method, the Company records its investment in the investee on the balance sheet initially at cost, and subsequently adjusts the carrying amount based on its share of the investee's net income or loss. Royalty distributions received from the investee are recognized as a reduction of the carrying amount of the investment. The Company's share of equity (income) losses and other adjustments associated with this equity method investment is included in royalty income in the unaudited Consolidated Statements of Income and Comprehensive Income. The carrying value for the Company's equity investment is reported in Equity Method Investment on the unaudited Consolidated Balance Sheets. The Company reports its share of earnings using a one-month lag because results are not available in time for it to record them in the concurrent period. This convention has not historically materially impacted the Company's results.

Equity Method Investment with WHP

On January 25, 2023, the Company closed the strategic partnership transaction with WHP. Pursuant to the transaction, the Company formed the Joint Venture and contributed certain intellectual property of the Company in exchange for 40% ownership of the Joint Venture. WHP invested $235.0 million for 60% ownership of the Joint Venture, implying a fair value of the Company’s retained 40% interest of approximately $156.7 million.

During the fourth quarter of 2022, under the derecognition guidance from ASC Topic 810, Consolidation, the Company derecognized the intellectual property assets at their carrying amount upon their contribution to the Joint Venture. Because the carrying amount of the contributed intellectual property assets was zero, a $391.7 million gain was recognized at the time of contribution, of which $156.7 million was related to the Company’s 40% interest in the Joint Venture. The gain was recorded in gain on transaction with WHP on the Consolidated Statements of Income and Comprehensive Income. Transaction costs capitalized in the cost of the equity method investment totaled $9.4 million.

Separately, under the terms of the transaction, the Company and WHP entered into an investment agreement (the “Investment Agreement”) pursuant to which an affiliate of WHP acquired 5.4 million newly issued shares of the Company’s common stock at a purchase price of $4.60 per share, representing an approximate pro forma ownership of 7.4% of the Company's outstanding shares of common stock. The difference between the purchase price paid and the trading price of the Company’s common stock on the day of the completion of the transaction resulted in a gain of $17.8 million recorded in gain on transaction with WHP on the Consolidated Statements of Income and Comprehensive Income.

In connection with the strategic partnership with WHP, on January 25, 2023, the Company and the Joint Venture entered into an Intellectual Property License Agreement (the “License Agreement”). The License Agreement provides the Company with an exclusive license in the United States to the intellectual property contributed in

EXPRESS, INC. | Q1 2023 Form 10-Q | 16

connection with the Membership Interest Purchase Agreement and certain other intellectual property. The initial term of the License Agreement is 10 years, and the License Agreement automatically renews for successive renewal terms of 10 years (unless the Company provides notice of non-renewal at least 24 months prior to the end of the initial or applicable renewal term). Except for the Company’s right not to renew the License Agreement, the License Agreement is not terminable by either party. The Company will pay the Joint Venture a royalty on net sales of certain licensed goods and will commit to an annual guaranteed minimum annual royalty during the term of the License Agreement (i.e., $60.0 million in the first contract year, increasing by $1.0 million per year for the next five contract years, and remaining at $65.0 million following the sixth contract year). The Company will pay royalties at a rate of (i) 3.25% of net sales arising from retail sales of certain licensed goods in the first through fifth contract years (and 3.5% thereafter), and (ii) 8% of net sales arising from wholesale sales of such goods. The Company prepaid the Joint Venture’s first year guaranteed minimum royalty of $60.0 million with a portion of the transaction proceeds and recorded as a prepaid royalty on the Consolidated Balance Sheets.

Pursuant to the agreement governing the operations of the Joint Venture (the “Operating Agreement”), cash earnings of the Joint Venture will be distributed quarterly to the Company and WHP on a pro rata basis based on their respective equity ownership interests.

As the Chairman and Chief Executive Officer of WHP was appointed to the Company’s board of directors upon the closing of the stock purchase discussed above, the agreements entered into in connection with the WHP partnership transaction, including the Operating Agreement, the Investment Agreement and the License Agreement (including related royalty payments) are considered related party transactions.

During the thirteen weeks ended April 29, 2023, the Company recognized $4.4 million of royalty income from the Joint Venture, which is recorded in royalty income in the unaudited Consolidated Statements of Income and Comprehensive Income.

Summary Financial Information for Equity Method Investment

Summarized financial information related to the Company's equity method investment in the aggregate on a one-month lag is reflected below:

	Thirteen Weeks Ended April 29, 20231
	(in thousands)
Revenue	$	11,881
Gross profit	11,881
Operating expenses	4,912
Income before taxes	6,969
Net income	$	6,693
Income attributable to the equity method investment	$	(4,440)

1.Reflects a one-month lag

	April 29, 20231
	(in thousands)
Current assets	$	9,637
Non-current assets	416,905
Total assets	$	426,542
Current liabilities	48,449
Non-current liabilities	—
Total liabilities	$	48,449
Equity method investment	$	166,210

1.Reflects a one-month lag

EXPRESS, INC. | Q1 2023 Form 10-Q | 17

NOTE 6 | INCOME TAXES

The provision for income taxes is based on a current estimate of the annual effective tax rate, adjusted to reflect the effect of discrete items. The Company’s effective income tax rate may fluctuate from quarter to quarter as a result of a variety of factors, including the estimate of annual pre-tax income, the related changes in the estimate, and the effect of discrete items. The impact of these items on the effective tax rate will be greater at lower pre-tax levels.

The Company evaluates whether deferred tax assets are realizable on a quarterly basis. The Company considers all available positive and negative evidence, including past operating results and expectations of future operating income. Accordingly, the Company maintains a valuation allowance against the amount of deferred tax assets not expected to be realized as of April 29, 2023.

The Company’s effective tax rate was (0.5)% and 3.9% for the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively. The effective tax rate for the thirteen weeks ended April 29, 2023 and April 30, 2022 reflect the impact of non-deductible executive compensation and the recording of an additional valuation allowance against the Company's current year losses.

The Company's unaudited Consolidated Balance Sheets as of April 29, 2023 and January 28, 2023 reflect $52.3 million of income tax receivable. The Company reclassified the receivable from current to non-current income tax receivable as of April 30, 2022 based on information received from the Internal Revenue Service during the thirteen weeks ended April 30, 2022 that indicated the receivable will not be collected in the next twelve months.

NOTE 7 | LEASES

The Company leases all of its store locations and its corporate headquarters, which also includes its distribution center, under operating leases. The store leases typically have initial terms of 5 to 10 years; however, most of the leases that are coming to the end of their lease lives are being renegotiated with shorter terms. The current lease term for the corporate headquarters expires in 2026, with one optional five-year extension period. The Company also leases certain equipment and other assets under operating leases, typically with initial terms of 3 to 5 years. The lease term includes the initial contractual term as well as any options to extend the lease when it is reasonably certain that the Company will exercise that option. Leases with an initial term of 12 months or less (short-term leases) are not recorded on the balance sheet. The Company does not currently have any material short-term leases. The Company is generally obligated for the cost of property taxes, insurance and other landlord costs, including common area maintenance charges, relating to its leases. If these charges are fixed, they are combined with lease payments in determining the lease liability; however, if such charges are not fixed, they are considered variable lease costs and are expensed as incurred. The variable payments are not included in the measurement of the lease liability or asset. The Company’s finance leases are immaterial.

Certain lease agreements include rental payments based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company’s lease agreements do not provide an implicit rate, so the Company uses an estimated incremental borrowing rate, which is derived from third-party information available at the lease commencement date, in determining the present value of lease payments. The rate used is for a secured borrowing of a similar term as the lease.

Supplemental cash flow information related to leases is as follows:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	57,648	$	64,832
Right of use assets obtained in exchange for operating lease liabilities	$	60,546	$	17,122

EXPRESS, INC. | Q1 2023 Form 10-Q | 18

NOTE 8 | DEBT

The following table summarizes the Company's outstanding debt as of the dates indicated:

	April 29, 2023		January 28, 2023
	(in thousands)
Revolving Credit Facility	$	179,750	$	122,000
Less: unamortized debt issuance costs	—		—
Total long-term debt, net	$	179,750	$	122,000
Outstanding letters of credit	$	19,636	$	19,636

Revolving Credit Facility

Express Holding (the "Borrower") and its subsidiaries are party to an Asset-Based Loan Credit Agreement entered into with the lenders party thereto, Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent and collateral agent, and Bank of America, N.A. (“Bank of America”), as documentation agent (the “ABL Credit Agreement”) pursuant to which revolving loans, up to a maximum borrowing amount of $290.0 million (the “Revolving Credit Facility”), may be borrowed, repaid and reborrowed until the maturity date of November 26, 2027, at which time all amounts borrowed must be repaid. Amounts borrowed under the Revolving Credit Facility bear interest at a variable rate indexed to SOFR (as defined in the ABL Credit Agreement) plus a pricing margin ranging from 1.75% to 2.25% per annum, as determined in accordance with the provisions of the ABL Credit Agreement based on average daily excess availability, as of any date of determination, for the most recently ended fiscal quarter, commencing April 30, 2023.

Amounts borrowed under the Revolving Credit Facility are subject to a borrowing base which is calculated based on specified percentages of eligible inventory, credit card receivables and cash, less certain reserves. Commitment reductions and termination of the Revolving Credit Facility prior to the maturity date is permitted, subject in certain instances to a prepayment fee. As of April 29, 2023, the interest rate on the outstanding borrowings of $179.8 million was approximately 7.1%.

The unused line fee payable under the Revolving Credit Facility is 0.25% per annum regardless of the average daily excess availability, payable in arrears monthly on the first day of each calendar month. The Borrower is also obligated to pay other customary closing fees, arrangement fees, administration fees and letter of credit fees for a credit facility of this size and type.

The ABL Credit Agreement requires the Borrower to maintain minimum excess availability of at least the greater of (i) $25.0 million or (ii) 10% of the sum of the Revolving Credit Facility loan cap. From and after the date on which EBITDA (as defined in the ABL Credit Agreement) has exceeded $50.0 million for two consecutive fiscal quarters (each of which consecutive fiscal quarters shall have commenced after November 2, 2024), at any time the excess availability is less than the greater of (i) $25.0 million or (ii) 10% of the Revolving Credit Facility loan cap, and until the excess availability exceeds such amount for thirty consecutive days, the Borrower is required to maintain a fixed charge coverage ratio (as further described in the ABL Credit Agreement) of at least 1.00:1.00, calculated as of the last day of each fiscal quarter (as further described in the ABL Credit Agreement).

The ABL Credit Agreement includes customary events of default that, include among other things, non-payment defaults, inaccuracy of representations and warranties, covenant defaults, cross-default to material indebtedness, bankruptcy and insolvency defaults, material judgment defaults, ERISA defaults, structural defaults under the loan documents and a change of control default. The occurrence of an event of default could result in the acceleration of the Borrower’s obligations under the Revolving Credit Facility. Under certain circumstances, a default interest rate will apply on any amounts payable under the Revolving Credit Facility during the existence of an event of default at a per annum rate equal to 2.00% above the applicable interest rate for any principal and 2.00% above the rate applicable for base rate loans for any other interest.

All obligations under the Revolving Credit Facility are guaranteed by the Loan Parties (other than the Borrower) and

EXPRESS, INC. | Q1 2023 Form 10-Q | 19

secured by a first priority lien on substantially all of the Loan Parties’ assets, subject to certain permitted liens.

As of April 29, 2023, the Company had $179.8 million in borrowings outstanding under the Revolving Credit Facility and approximately $90.4 million remained available for borrowing under the Revolving Credit Facility after giving effect to outstanding letters of credit in the amount of $19.6 million and subject to certain borrowing base limitations as further discussed above. The fair value of the outstanding borrowings under the Revolving Credit Facility is estimated using Level 2 inputs and at April 29, 2023 and January 28, 2023 was $162.5 million and $115.0 million, respectively.

Letters of Credit

From time to time, the Company may enter into various trade letters of credit ("trade LCs") in favor of certain vendors to secure merchandise. These trade LCs are issued for a defined period of time, for specific shipments, and generally expire three weeks after the merchandise shipment date. As of April 29, 2023 and January 28, 2023, there were no outstanding trade LCs. Additionally, the Company enters into stand-by letters of credit ("stand-by LCs") on an as-needed basis to secure payment obligations for third party logistic services, merchandise purchases, and other general and administrative expenses. As of April 29, 2023 and January 28, 2023, outstanding stand-by LCs totaled $19.6 million, respectively.

NOTE 9 | LONG-TERM INCENTIVE COMPENSATION

The Company records the fair value of share-based payments to employees in the unaudited Consolidated Statements of Income and Comprehensive Income as compensation expense, net of forfeitures, over the requisite service period. The Company issues shares of common stock from treasury stock, at average cost, upon exercise of stock options and vesting of restricted stock units, including those with performance conditions.

Long-Term Incentive Compensation

The following summarizes long-term incentive compensation expense:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Restricted stock units	$	762	$	1,193
Stock options	87		87
Performance-based restricted stock units	1,022		1,113
Total share-based compensation	$	1,871	$	2,393
Cash-settled awards	2,653		2,720
Total long-term incentive compensation	$	4,524	$	5,113

The stock compensation related income tax benefit, excluding consideration of valuation allowances, recognized by the Company during the thirteen weeks ended April 29, 2023 and April 30, 2022 was $4.1 million and $2.7 million, respectively.

The valuation allowances associated with these tax benefits were $4.1 million and $2.7 million for the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively.

Equity Awards

Restricted Stock Units

During the thirteen weeks ended April 29, 2023, the Company granted restricted stock units (“RSUs”) under the Express, Inc. 2018 Incentive Compensation Plan (the "Plan"). The fair value of RSUs is generally determined based on the Company’s closing stock price on the day prior to the grant date in accordance with the 2018 Plan. The RSUs granted generally vest ratably over one to three years and the expense related to these RSUs is recognized using the straight-line attribution method over this vesting period.

EXPRESS, INC. | Q1 2023 Form 10-Q | 20

The Company’s activity with respect to RSUs for the thirteen weeks ended April 29, 2023 was as follows:

	Number of Shares	Grant Date Weighted Average Fair Value Per Share
	(in thousands, except per share amounts)
Unvested - January 28, 2023	1,733	$	2.27
Granted	13	$	1.14
Vested	(1,239)	$	2.11
Forfeited	(45)	$	2.73
Unvested - April 29, 2023	462	$	2.61

The total fair value of RSUs that vested during the thirteen weeks ended April 29, 2023 and April 30, 2022 was $2.6 million and $3.9 million, respectively. As of April 29, 2023, there was approximately $0.3 million of total unrecognized compensation expense related to unvested RSUs, which is expected to be recognized over a remaining weighted-average period of approximately 0.6 years.

Stock Options

The Company’s activity with respect to stock options during the thirteen weeks ended April 29, 2023 was as follows:

	Number of Shares	Grant Date Weighted Average Exercise Price Per Share		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
	(in thousands, except per share amounts and years)
Outstanding - January 28, 2023	2,857	$	4.84
Granted	—	$	—
Exercised	—	$	—
Forfeited or expired	(93)	$	15.84
Outstanding - April 29, 2023	2,764	$	4.48	5.65	$	—
Expected to vest at April 29, 2023	280	$	2.60	6.21	$	—
Exercisable at April 29, 2023	2,484	$	4.69	5.58	$	—

As of April 29, 2023, there was approximately $0.1 million of total unrecognized compensation expense related to stock options, which is expected to be recognized over a remaining weighted average period of approximately 0.2 years.

Performance-Based Restricted Stock Units

During 2022, the Company granted performance-based RSUs to a limited number of senior executive-level employees, which entitle these employees to receive a specified number of shares of the Company’s common stock upon vesting. The number of shares earned could range between 0% and 200% of the target amount depending upon performance achieved over a three-year vesting period. The performance conditions of the award include adjusted earnings before interest, taxes, depreciation, and amortization ("Adjusted EBITDA") targets and total shareholder return ("TSR") of the Company’s common stock relative to a select group of peer companies. A Monte Carlo valuation model was used to determine the fair value of the awards. The TSR performance condition is a market condition. Therefore, the fair value of the portion of the awards which vest based on the TSR performance condition is fixed at the measurement date and is not revised based on actual performance during the three-year vesting period. The number of shares underlying the portion of the awards which vest based on the Company’s Adjusted EBITDA performance in relation to the pre-established targets will change during the three-year vesting period based on estimates. As of April 29, 2023, $4.6 million of total unrecognized compensation cost is expected to be recognized on performance-based restricted stock units over a remaining weighted-average period of 1.4 years.

EXPRESS, INC. | Q1 2023 Form 10-Q | 21

Cash-Settled Awards

Time-Based Cash-Settled Awards

During the thirteen weeks ended April 29, 2023, the Company granted time-based cash-settled awards to employees that vest ratably over three years. These awards are classified as liabilities and do not vary based on changes in the Company's stock price or financial performance. The expense related to these awards will be accrued using a straight-line method over this vesting period. As of April 29, 2023, $19.9 million of total unrecognized compensation cost is expected to be recognized on cash-settled awards over a remaining weighted-average period of 1.7 years.

Performance-Based Cash-Settled Awards

During the thirteen weeks ended April 29, 2023, the Company granted performance-based cash-settled awards to a limited number of senior executive-level employees. These awards are classified as liabilities, are valued based on the fair value of the award at the grant date and are remeasured at each reporting date until settlement with compensation expense being recognized in proportion to the completed requisite service period up until date of settlement. The amount of cash earned ranges between 0% and 200% of the target amount depending upon performance achieved over a three-year performance period commencing on the first day of the Company’s 2023 fiscal year and ending on the last day of the Company’s 2025 fiscal year. The performance conditions of the award include Adjusted EBITDA targets and TSR of the Company’s common stock relative to a select group of peer companies. The fair value of the awards will change based on estimates of the Company’s Adjusted EBITDA performance in relation to the pre-established targets. A Monte Carlo valuation model is used to determine the fair value of the awards. As of April 29, 2023, $4.9 million of total unrecognized compensation cost is expected to be recognized on performance-based cash-settled awards over a remaining weighted-average period of 3.0 years.

NOTE 10 | COMMITMENTS AND CONTINGENCIES

In a complaint filed in January 2017 by Mr. Jorge Chacon in the Superior Court for the State of California for the County of Orange, certain subsidiaries of the Company were named as defendants in a representative action alleging violations of California state wage and hour statutes and other labor standards. The lawsuit seeks unspecified monetary damages and attorneys’ fees.

In July 2018, former associate Ms. Christie Carr filed suit in Alameda County Superior Court for the State of California naming certain subsidiaries of the Company as defendants in a representative action alleging violations of California State wage and hour statutes and other labor standard violations. The lawsuit seeks unspecified monetary damages and attorneys’ fees.

On January 29, 2019, Mr. Jorge Chacon filed a second representative action in the Superior Court for the State of California for the County of Orange alleging violations of California state wage and hour statutes and other labor standard violations, which was removed to federal court by the Company and is now pending in the United States District Court for the Central District of California (the “District Court”). The lawsuit seeks unspecified monetary damages and attorneys' fees. In June 2021, a portion of Mr. Chacon’s claims in this action were certified as a class action. Plaintiff and the Company both filed Motions for Summary Judgment on February 28, 2022.

In June 2022, as a result of a mediation process overseen by an independent mediator, the parties agreed, subject to approval by the District Court, to settle these matters for an amount not material to the Company. The proposed settlement will resolve the Chacon and Carr matters in their entirety and also provide for a broad release of claims asserted therein on behalf of the Company’s current and former employees in California for wage and hour violations.

As of April 29, 2023, the Company's unaudited Consolidated Balance Sheet includes an estimated liability based on its best estimate of the outcome of the unresolved matters.

EXPRESS, INC. | Q1 2023 Form 10-Q | 22

NOTE 11 | STOCKHOLDERS' EQUITY

Share Repurchase Program

On November 28, 2017, the Company's Board of Directors ("Board") approved a share repurchase program that authorizes the Company to repurchase up to $150.0 million of the Company’s outstanding common stock using available cash (the "Repurchase Program"). The Company may repurchase shares on the open market, including through Rule 10b5-1 plans, in privately negotiated transactions, through block purchases, or otherwise in compliance with applicable laws, including Rule 10b-18 of the Exchange Act of 1934. The timing and amount of stock repurchases will depend on a variety of factors, including business and market conditions as well as corporate and regulatory considerations. The share repurchase program may be suspended, modified, or discontinued at any time and the Company has no obligation to repurchase any amount of its common stock under the program. During the thirteen weeks ended April 29, 2023 and April 30, 2022, the Company did not repurchase any shares of its common stock. As of April 29, 2023, the Company had approximately $34.2 million remaining under this Board authorization.

NOTE 12 | SUBSEQUENT EVENTS

Bonobos Asset Acquisition

On May 23, 2023, the Company completed the acquisition of the operating assets of the Bonobos business. Total cash consideration paid by the Company at the closing of the transaction was $28.3 million, which represents (i) the $25.0 million purchase price, plus (ii) certain customary adjustments related to net working capital and prepaid rent expense.

License Agreement

On May 23, 2023, the Company and WHP entered into a license agreement that provides the Company with an exclusive license in the United States to intellectual property related to the Bonobos brand, including intellectual property rights for the Bonobos brand that was separately acquired by WHP (the “Bonobos License Agreement”). The Bonobos License Agreement has an initial term of 10 years from the effective date, and will automatically renew for successive renewal terms of 10 years unless (i) the Company provides notice of non-renewal at least 24 months prior to the end of the initial or applicable renewal term, or (ii) WHP exercises its right to not renew in the event of certain failures by the Company to pay the annual guaranteed minimum royalty. Except for such non-renewal rights, the Bonobos License Agreement will not be terminable by either party. The Company will pay WHP a royalty on net sales of certain licensed goods and will commit to an annual guaranteed minimum royalty during the term of the Bonobos License Agreement (ranging from $6.5 million in the first contract year to $11.5 million in the tenth contract year and each contract year thereafter). The Company will pay royalties at a rate of (i) 3.25% of net sales arising from retail sales of certain licensed goods in the first through the fifth contract years (and 3.5% thereafter), and (ii) 8% of net sales arising from wholesale sales of such goods.

EXPRESS, INC. | Q1 2023 Form 10-Q | 23

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

The following discussion summarizes the significant factors affecting the consolidated operating results, financial condition, liquidity, and cash flows of the Company as of the dates and for the periods presented below. The following discussion and analysis should be read in conjunction with our Annual Report and our unaudited Consolidated Financial Statements and the related Notes included in Item 1 of this Quarterly Report. This discussion contains forward-looking statements that are based on the beliefs of our management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result of various factors. See “Forward-Looking Statements.”

All references herein to “the first quarter of 2023” and “the first quarter of 2022” represent the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively.

Our management's discussion and analysis of financial condition and results of operations is presented in the following sections:

	Page
Overview	24
Business Trends	25
Financial Details for the First Quarter of 2023	25
First Quarter Update & Outlook	25
How We Assess the Performance of Our Business	28
Results of Operations	30
Liquidity and Capital Resources	33
Critical Accounting Policies	34

\

OVERVIEW

Express is a multi-brand fashion retailer whose portfolio includes Express and UpWest. The Company operates an omnichannel platform, including both physical and online stores. Grounded in a belief that style, quality and value should all be found in one place, Express is a brand with a purpose - We Create Confidence. We Inspire Self-Expression. - powered by a styling community. UpWest is an apparel, accessories and home goods brand with a purpose to Provide Comfort for People & Planet. We operate 545 retail and factory outlet stores in the United States and Puerto Rico, the express.com online store, the Express mobile app and the UpWest.com online store.

WHP Strategic Partnership

On January 25, 2023, we closed the strategic partnership transaction with WHP Global ("WHP"), a leading global brand management firm. Pursuant to the transaction, WHP acquired 5.4 million newly issued shares of our common stock at a purchase price of $4.60 per share, or $25.0 million in the aggregate, representing approximately 7.4% of our outstanding shares of common stock, on a pro forma basis, as of the closing of the transaction. The mutually transformative strategic partnership advances our omnichannel platform which is expected to drive accelerated, long-term growth through the acquisition and operation of a portfolio of brands. The Company and WHP also formed a Joint Venture valued at approximately $400.0 million, with WHP committing $235.0 million to the Joint Venture for 60% ownership of the Joint Venture and the Company contributing certain intellectual property in exchange for 40% ownership of the Joint Venture. The Joint Venture is intended to scale the Express brand through new domestic category licensing and international expansion opportunities. Refer to Note 5 included elsewhere in this Quarterly Report for further discussion regarding the WHP strategic partnership.

EXPRESS, INC. | Q1 2023 Form 10-Q | 24

\

BUSINESS TRENDS

MACROECONOMIC OUTLOOK

The macroeconomic environment in which we operate remains uncertain as a result of numerous factors, including inflationary pressures, rising interest rates and fears of a potential recession impacting consumer spending behavior, and aggressive promotional activity which constrained revenue and increased margin pressure. Given our recent business trends and ongoing external uncertainties, we have taken additional action to reduce expenses and improve the operating efficiency of our business, including identifying and implementing significant additional expense savings. The continued effect of these challenges may impact mid-term and longer-term consumer discretionary spending behavior and the promotional landscape in which we operate. We believe that these macroeconomic and other factors have contributed to the slowdown in demand that we have experienced in our business over the last several fiscal quarters.

For additional information regarding risks related to these related operational and industry risks, see “Item 1A. Risk Factors: Operational and Industry Risk Factors” in our Annual Report.

FINANCIAL DETAILS FOR THE FIRST QUARTER OF 2023

•Consolidated net sales decreased 15% to $383.3 million from $450.8 million in the first quarter of 2022

•Consolidated comparable sales decreased 14% compared to the first quarter of 2022

•Comparable retail sales (includes both retail stores and eCommerce sales) decreased 13% compared to the first quarter of 2022

•Comparable outlet sales decreased 17% compared to the first quarter of 2022

•Gross margin was 16.6% of net sales compared to 29.2% of net sales in last year's first quarter, a decrease of approximately 1,260 basis points

•Operating loss was $70.1 million compared to an operating loss of $9.1 million in the first quarter of 2022

•Net loss was $73.4 million, or $0.99 per diluted share, compared to a net loss of $11.9 million, or $0.18 per diluted share, in the first quarter of 2022

Key Performance Metrics

The following charts show key performance metrics for the first quarter of 2023 compared to the first quarter of 2022.

FIRST QUARTER UPDATE & OUTLOOK

We are transforming Express to create shareholder value guided by a new corporate strategy, inclusive of the following four components:

•Achieving profitable growth in our core Express business

•Optimizing our omnichannel platform

•Accelerating our growth and profitability through the WHP strategic partnership

•Operating with financial discipline

EXPRESS, INC. | Q1 2023 Form 10-Q | 25

Achieve Profitable Growth in Our Core Express Business

The first component of our new corporate strategy is achieving profitable growth in our core Express business. We expect to achieve profitable growth in our core Express business through our EXPRESSway Forward strategy which has four foundational pillars:

PRODUCT BRAND CUSTOMER EXECUTION

Product

We are committed to being a product-first organization and our design and merchandising approach is to edit the best of now for real-life versatility. The best of now speaks to our history as a trend-right brand, and versatility is about covering the full spectrum of a customer's wearing occasions and wardrobe requirements. Express customers expect newness, versatility, quality, and value and providing these qualities drives our decisions around product.

As we began the first quarter of 2023, our women's assortments were out of balance across multiple dimensions. We continue to take corrective actions designed to address these imbalances and saw sequential improvement in sales as the first quarter of 2023 progressed. These assortment recalibrations are expected to continue as we move through the year. While our women's business improved in the first quarter of 2023 versus the fourth quarter of 2022, that performance was offset by a deceleration in our men's and outlet businesses, which had delivered record volume in the first quarter of 2022. Moving forward, we are focused on investing in our key category strengths, which we expect will lead to increased frequency, units per transaction, loyalty and market share gains. We are chasing into trends and have secured additional products for the second quarter of 2023 in some of our best-selling categories. We are reducing our average unit costs and expect to realize those benefits in the second half of 2023.

Brand

We are transforming Express from being known as a store in the mall to a brand with a purpose, powered by a styling community. We have created a compelling brand purpose: We Create Confidence. We Inspire Self-Expression. We believe we can accomplish this by editing the best of now for real life versatility.

The Express styling community is an authentic way to bring our brand purpose to life. Members of the Express styling community - customers, associates, Style Editors, content creators, influencers and brand partners - interact with each other in the physical and digital worlds. Building, activating and amplifying this styling community is one of our key priorities in 2023.

Customer

We continually aim to successfully engage existing customers and acquire new ones. Our Express Insider loyalty program continues to operate with the highest number of active loyalty members in our history.

In the first quarter of 2023, spend per customer held steady due to an increase in shopping frequency. We fell short of our acquisition targets, but did see sequential improvement as we moved through the first quarter of 2023. We have implemented strategies designed to engage existing customers, reengage lapsed customers and attract new customers.

Execution

We are taking aggressive action to reduce expenses and improve the operating efficiency of our business. In January of 2023, we implemented $40.0 million in annualized expense savings versus 2022, excluding the impact of inflation, and since that time, we have implemented an additional $25.0 million in expense savings, which we expect to realize in 2023. We are committed to identifying and implementing significant additional expense savings which we expect to be realized in the second half of fiscal 2023 and full fiscal year 2024. To ensure an efficient process, we have engaged external advisors to assist in analyzing and identifying both potential margin expansion and further expense saving opportunities.

Within our eCommerce channel, the advancements we have made to our Express website and mobile app over the last three years have strengthened our omnichannel offering. Through website and mobile app enhancements, new

EXPRESS, INC. | Q1 2023 Form 10-Q | 26

features, personalization, user-generated content, and other initiatives, we believe we have more seamlessly connected our channels and built a platform on which all parts of the Express styling community can connect. In the first quarter of 2023, eCommerce sales were driven by the improvement in our women’s business which historically has accounted for a significant share of our eCommerce sales.

We design our stores to create a distinctive, engaging shopping environment and project our image of Express as a fashion authority. Our stores are located primarily in high-traffic shopping malls, lifestyle centers, outlet centers, and street locations. Our Express Edit stores present a highly curated and uniquely merchandised product assortment to customers in key fashion and influencer markets, with each store's presentation tailored to the relevant location. In the first quarter of 2023, sales performance in our Retail and Outlet stores was negatively impacted by the slowdown in our men’s business, a significant decline in traffic and reduced conversion.

Optimize our Omnichannel Platform

The second component of our new corporate strategy is to optimize our fully integrated omnichannel platform, with the aim of operating and growing a portfolio of fashion brands. We expect to leverage our existing strengths and capabilities in production and sourcing, logistics, technology, real estate, finance, legal and HR to achieve synergies and drive efficiencies across this portfolio.

UpWest is a proof point of the effectiveness of our platform today. We launched UpWest in 2019 as a digitally native brand and have since opened brick-and-mortar stores and established a wholesale relationship with Nordstrom. As of April 29, 2023, we operated 13 UpWest stores.

Accelerate Growth and Profitability Through Our Strategic Partnership with WHP

The third component of our new corporate strategy is to accelerate our growth and profitability through our strategic partnership with WHP. In connection with our strategic partnership, Express, in conjunction with the WHP team, continues to explore domestic category and international licensing opportunities. In May 2023, we and WHP completed our joint acquisition of Bonobos, with Express acquiring the operating assets (and assuming the related liabilities) of the Bonobos business and licensing the intellectual property acquired by WHP for the operation of the Bonobos business in the U.S. Bonobos launched in 2007 as a digitally native menswear brand and quickly became known for exceptional fit and an innovative guide shop retail model. Bonobos has delivered strong sales growth over the past three years. We intend to build upon the strength of Bonobos and eCommerce marketing and customer loyalty, leverage our expertise in product and omnichannel retail and unlock additional growth for Bonobos by extending the brand into underpenetrated categories. We also plan to grow Bonobos through WHP's expertise in licensing and international distribution.

Operate with Financial Discipline

The fourth component of our new corporate strategy is operating with financial discipline. We plan to build upon a foundation of strong, rigorous financial discipline and redesign the financial architecture of our Company to create a more agile expense framework that will allow us to be more flexible in a dynamic macroeconomic environment.

EXPRESS, INC. | Q1 2023 Form 10-Q | 27

HOW WE ASSESS THE PERFORMANCE OF OUR BUSINESS

In assessing the performance of our business, we consider a variety of performance and financial measures. These key measures include net sales, comparable sales, eCommerce demand, transactions, cost of goods sold, buying and occupancy costs, gross profit/gross margin, and selling, general, and administrative expenses. The following table describes and discusses these measures.

Net Sales

Description

Revenue from the sale of merchandise, less returns and discounts, as well as shipping and handling revenue related to eCommerce, revenue from the rental of our LED sign in Times Square, gift card breakage and revenue earned from our private label credit card agreement.

Discussion

Our business is seasonal, and we have historically realized a higher portion of our net sales in the third and fourth quarters, due primarily to the impact of the holiday season. Generally, approximately 45% of our annual net sales occur in the Spring season (first and second quarters) and 55% occur in the Fall season (third and fourth quarters).

Comparable Sales

Description

Comparable sales is a measure of the amount of sales generated in a period relative to the amount of sales generated in the comparable prior year period. Comparable sales for the first quarter of 2023 was calculated using the thirteen weeks ended April 29, 2023 as compared to the thirteen weeks ended April 30, 2022.

Comparable retail sales includes:

•Sales from retail stores that were open 12 months or more as of the end of the reporting period

•eCommerce shipped sales

Comparable outlet sales includes:

•Sales from outlet stores that were open 12 months or more as of the end of the reporting period, including conversions

Comparable sales excludes:

•Sales from stores where the square footage has changed by more than 20% due to remodel or relocation activity

•Sales from stores in a phased remodel where a portion of the store is under construction and therefore not productive selling space

•Sales from stores where the store cannot open due to weather damage or other catastrophes, including pandemics

Discussion

Our business and our comparable sales are subject, at certain times, to calendar shifts, which may occur during key selling periods close to holidays such as Easter, Thanksgiving, and Christmas, and regional fluctuations for events such as sales tax holidays. We believe comparable sales provides a useful measure for investors by removing the impact of new stores and closed stores. Management considers comparable sales a useful measure in evaluating continuing store performance.

eCommerce Demand

Description

eCommerce demand is defined as gross orders for Express and/or third party merchandise that originate through our eCommerce platform, including the website, app, and buy online pick-up in store.

Discussion

We believe eCommerce demand is a useful operational metric for investors and management as it provides visibility for orders placed but not yet shipped.

EXPRESS, INC. | Q1 2023 Form 10-Q | 28

Transactions

Description

Transactions are defined as the number of customer point of sale interactions with customers.

Discussion

We believe this metric is useful as it provides a better indicator of the acceptance of our product.

Cost of Goods Sold, Buying and Occupancy Costs

Description

Includes the following:

•Direct cost of purchased merchandise

•Inventory shrink and other adjustments

•Inbound and outbound freight

•Royalties paid to the Joint Venture

•Merchandising, design, planning and allocation, and manufacturing/production costs

•Occupancy costs related to store operations (such as rent and common area maintenance, utilities, and depreciation on assets)

•Logistics costs associated with our eCommerce business

•Impairments on long-lived assets and right of use lease assets

Discussion

Our cost of goods sold typically increases in higher volume quarters because the direct cost of purchased merchandise is tied to sales.

The primary drivers of the costs of individual goods are raw materials, labor in the countries where our merchandise is sourced, and logistics costs associated with transporting our merchandise.

Buying and occupancy costs related to stores are largely fixed and do not necessarily increase as volume increases.

Changes in the mix of products sold by type of product or by channel may also impact our overall cost of goods sold, buying and occupancy costs.

Extended periods of declined business and sales could result in additional impairment of our assets.

Gross Profit/Gross Margin

Description

Gross profit is net sales minus cost of goods sold, buying and occupancy costs. Gross margin measures gross profit as a percentage of net sales.

Discussion

Gross profit/gross margin is impacted by the price at which we are able to sell our merchandise and the cost of our product.

We review our inventory levels on an on-going basis in order to identify slow-moving merchandise and generally use markdowns to clear such merchandise. The timing and level of markdowns are driven primarily by seasonality and customer acceptance of our merchandise and have a direct effect on our gross margin.

Any marked down merchandise that is not sold is marked-out-of-stock. We use third-party vendors to dispose of this marked-out-of-stock merchandise.

Selling, General, and Administrative Expenses

Description

Includes operating costs not included in cost of goods sold, buying and occupancy costs such as:

•Payroll and other expenses related to operations at our corporate offices

•Store expenses other than occupancy costs

•Marketing expenses, including production, mailing, print, and digital advertising costs, among other things

Discussion

With the exception of store payroll, certain marketing expenses, and incentive compensation, selling, general, and administrative expenses generally do not vary proportionally with net sales. As a result, selling, general, and administrative expenses as a percentage of net sales are usually higher in lower volume quarters and lower in higher volume quarters.

EXPRESS, INC. | Q1 2023 Form 10-Q | 29

RESULTS OF OPERATIONS

The First Quarter of 2023 compared to the First Quarter of 2022

Store Activity

The following table shows store activity for the stated periods:

	Thirteen Weeks Ended April 29, 2023				Thirteen Weeks Ended April 30, 2022
	Retail1	Outlet	UpWest	Total	Retail2	Outlet	UpWest	Total
Beginning stores	342	198	13	553	351	203	7	561
New stores	—	—	—	—	1	—	3	4
Closed stores	(5)	(3)	—	(8)	(3)	(1)	—	(4)
Ending Stores	337	195	13	545	349	202	10	561
Gross square footage at end of period (in thousands)				4,499				4,664

1.As of April 29, 2023, ending retail store count includes 10 Express Edit stores

2.As of April 30, 2022, ending retail store count includes 5 Express Edit stores

Net Sales

The following table shows net sales and comparable sales for the stated periods:

	Thirteen Weeks Ended
	April 29, 2023			April 30, 2022
Net sales (in thousands)	$	383,257		$	450,785
Dollar change compared to prior year	$	(67,528)
Percentage change compared to prior year	(15.0)		%
Comparable retail sales	(13)		%	32		%
Comparable outlet sales	(17)		%	30		%
Total comparable sales percentage change	(14)		%	31		%

Net sales in the first quarter of 2023 decreased approximately $67.5 million as compared to the first quarter of 2022. The decrease in sales was primarily attributable to reduced consumer spending, increased price sensitivity in discretionary categories and aggressive promotional activity across the industry that began in 2022 and continued into the first quarter of 2023. We continued to take corrective actions to address the imbalances in our women's assortment architecture and delivered sequential improvement in women’s sales as the quarter progressed. However, we experienced a deceleration in our men's and outlet stores businesses due to softness in traffic and against the backdrop of record volume in the first quarter of 2022.

Gross Profit

The following table shows cost of goods sold, buying and occupancy costs, gross profit in dollars, and gross margin percentage for the stated periods:

	Thirteen Weeks Ended
	April 29, 2023			April 30, 2022
	(in thousands, except percentages)
Cost of goods sold, buying and occupancy costs	$	319,464		$	319,285
Gross profit	$	63,793		$	131,500
Gross margin percentage	16.6		%	29.2		%
Dollar change compared to prior year	$	(67,707)

The 1,260 basis point decrease in gross margin percentage, or gross profit as a percentage of net sales, in the first

EXPRESS, INC. | Q1 2023 Form 10-Q | 30

quarter of 2023 as compared to the first quarter of 2022 was comprised of a decrease in merchandise margin of 900 basis points and an increase in buying and occupancy costs as a percentage of net sales of 360 basis points. The decrease in merchandise margin was primarily driven by the challenging macroeconomic and highly promotional retail environment and 320 basis points of royalty expense related to the Joint Venture with WHP. Buying and occupancy deleveraged due to the decline in comparable sales.

Selling, General, and Administrative Expenses

The following table shows selling, general, and administrative expenses ("SG&A") in dollars and as a percentage of net sales for the stated periods:

	Thirteen Weeks Ended
	April 29, 2023			April 30, 2022
	(in thousands, except percentages)
Selling, general, and administrative expenses	$	139,348		$	141,093
Selling, general, and administrative expenses, as a percentage of net sales	36.4		%	31.3		%
Dollar change compared to prior year	$	(1,745)

The $1.7 million decrease in selling, general, and administrative expenses in the first quarter of 2023 as compared to the first quarter of 2022 was primarily driven by lower marketing spend and incentive compensation, partially offset by elevated store wage pressures from minimum wage and merit, consulting and information technology expenses. The deleverage in the SG&A expense rate was driven by the decline in comparable sales.

Royalty Income

The following table shows royalty income in dollars and as a percentage of net sales for the stated periods:

	Thirteen Weeks Ended
	April 29, 2023			April 30, 2022
	(in thousands, except percentages)
Royalty income	$	(4,440)		$	—
Royalty income, as a percentage of net sales	(1.2)		%	—		%
Dollar change compared to prior year	$	(4,440)

The $4.4 million increase in royalty income in the first quarter of 2023 as compared to first quarter of 2022 was due to our share of equity income associated with our equity investment with WHP. Refer to Note 5 in our unaudited Consolidated Financial Statements included elsewhere in this Quarterly Report for further discussion.

Interest Expense, Net

The following table shows interest expense in dollars and as a percentage of net sales for the stated periods:

	Thirteen Weeks Ended
	April 29, 2023			April 30, 2022
	(in thousands, except percentages)
Interest expense, net	$	2,943		$	3,494
Interest expense, as a percentage of net sales	0.8		%	0.8		%
Dollar change compared to prior year	$	(551)

The $0.6 million decrease in interest expense in the first quarter of 2023 as compared to the first quarter of 2022 was the result of the elimination of the term loan offset by higher borrowings and higher interest rates on our Revolving Credit Facility. Refer to Note 8 in our unaudited Consolidated Financial Statements included elsewhere in this Quarterly Report for further discussion regarding our borrowings during the first quarter of 2023.

EXPRESS, INC. | Q1 2023 Form 10-Q | 31

Income Tax Expense (Benefit)

The following table shows income tax expense (benefit) in dollars and as a percentage of net sales for the stated periods:

	Thirteen Weeks Ended
	April 29, 2023			April 30, 2022
	(in thousands, except percentages)
Income tax expense (benefit)	$	369		$	(483)
Income tax expense (benefit), as a percentage of net sales	0.1		%	(0.1)		%
Dollar change compared to prior year	$	852

The effective tax rate was (0.5)% and 3.9% for the first quarter of 2023 and first quarter of 2022, respectively. The effective tax rate for the first quarter of 2023 reflects the impact of non-deductible executive compensation and the recording of an additional valuation allowance against our current-year losses. The effective tax rate for the first quarter of 2022 reflects the impact of non-deductible executive compensation and the recording of an additional valuation allowance against our current-year losses.

Reconciliation of Non-GAAP Financial Measures to GAAP Measures

We supplement the reporting of our financial information determined under United States generally accepted accounting principles ("GAAP") with certain non-GAAP financial measures such as earnings before interest, taxes, depreciation, and amortization ("EBITDA"). We strongly encourage investors and stockholders to review our financial statements and publicly-filed reports in their entirety and not to rely on any single financial measure.

EBITDA

EBITDA is defined as net income (loss) before interest expense (net of interest income), income tax expense (benefit) and depreciation and amortization expense.

How This Measure is Useful

When used in conjunction with GAAP financial measures, EBITDA is a supplemental measure of operating performance that we believe is a useful measure to facilitate comparisons to historical performance. EBITDA is used as a performance measure in our long-term executive compensation program for purposes of determining the number of equity awards that are ultimately earned and is also a metric used in our short-term cash incentive compensation plan.

Limitations of the Usefulness of This Measure

Because non-GAAP financial measures are not standardized, EBITDA may differ from similarly titled measures used by other companies due to different methods of calculation. Presentation of EBITDA is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Therefore, this measure may not provide a complete understanding of our performance and should be reviewed in conjunction with the GAAP financial measures. A reconciliation of EBITDA to the most directly comparable GAAP measures, is set forth below:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Net loss	$	(73,427)	$	(11,914)
Interest expense, net	2,943		3,494
Income tax expense (benefit)	369		(483)
Depreciation and amortization	14,246		14,736
EBITDA (Non-GAAP Measure)	$	(55,869)	$	5,833

EXPRESS, INC. | Q1 2023 Form 10-Q | 32

LIQUIDITY AND CAPITAL RESOURCES

Forward-Looking Liquidity Discussion

Our liquidity position benefits from the fact that we generally collect cash from sales to customers the same day or, in the case of credit or debit card transactions, within three to five days of the related sale, and we have up to 75 days to pay certain merchandise vendors and 45 days to pay the majority of our non-merchandise vendors. We also have commitments under lease agreements and debt agreements that will require future cash outlays.

Based upon the sales and results of operations seen during the first quarter of 2023, and expense reduction and other measures planned and taken to date, we were in compliance with the financial covenants under our Revolving Credit Facility as of April 29, 2023. We plan to continue enhancing our liquidity by selling through our inventory at appropriate retail prices and identifying and implementing additional expense savings. Our plans are focused on improving our results and liquidity through expense savings and improved sales trends as we move through the balance of fiscal year 2023. We are committed to finding significant additional expense savings which are expected to benefit the second half of fiscal 2023 and full fiscal year 2024, and have engaged external advisors to assist in analyzing and identifying both potential margin expansion and further expense saving opportunities. We believe this will result in adequate cash flows to support our ongoing operations and to meet our financial covenant requirements under the Revolving Credit Facility for at least one year following the date that these unaudited Consolidated Financial Statements in Part I, Item 1 of this Quarterly Report are issued. However, due to the uncertainty related to the challenging macroeconomic, consumer and competitive environments we could experience material changes to our forecasted revenues and cash flows and may experience difficulty remaining in compliance with financial covenants.

To fund our normal working capital requirements, we plan to continue to utilize additional borrowing capacity under our Revolving Credit Facility, which was $90.4 million as of April 29, 2023. We currently have (and in the future may continue to have) a negative working capital balance, meaning our current liabilities exceed our current assets (including cash balances). Our current liabilities include current operating lease liabilities, for which the corresponding operating right of use assets are recorded as non-current on our unaudited Consolidated Balance Sheets. The ABL Credit Agreement contains certain affirmative and negative covenants. Refer to Note 8 in our unaudited Consolidated Financial Statements included elsewhere in this Quarterly Report for further details regarding the Revolving Credit Facility and the ABL Credit Agreement.

Analysis of Cash Flows

A summary of cash provided by or used in operating, investing and financing activities is shown in the following table:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Used in operating activities	$	(80,612)	$	(75,879)
Used in investing activities	(8,304)		(5,142)
Provided by financing activities	57,396		76,985
Decrease in cash and cash equivalents	(31,520)		(4,036)
Cash and cash equivalents at end of period	$	34,092	$	37,140

Operating Activities

Our business relies on cash flows from operations as our primary source of liquidity, with the majority of those cash flows being generated in the fourth quarter of the year. Our primary operating cash needs are for merchandise inventories, payroll, store rent and marketing. For the thirteen weeks ended April 29, 2023, our cash flows used in operating activities were $80.6 million compared to $75.9 million used in operating activities for the thirteen weeks ended April 30, 2022. This $4.7 million decrease in cash flows from operating activities for the thirteen weeks ended April 29, 2023 as compared to the same period in 2022 was primarily driven by changes in working capital and operating loss. The changes in working capital were primarily driven by a decrease in accounts payable due to the payment of inventory related amounts on the unaudited Consolidated Balance Sheets at January 28, 2023.

EXPRESS, INC. | Q1 2023 Form 10-Q | 33

Investing Activities

We had capital expenditures of approximately $8.2 million for the thirteen weeks ended April 29, 2023 and $5.1 million for the thirteen weeks ended April 30, 2022. Our capital expenditures consist primarily of new and remodeled store construction and fixtures and investments in information technology. The $3.1 million increase in capital expenditures for the thirteen weeks ended April 29, 2023 was primarily driven by investments in information technology to support our strategic business initiatives. We expect capital expenditures for the remainder of 2023 to be approximately $22.0 million, primarily driven by new and remodeled store construction and investments in information technology.

Financing Activities

Credit Facility

During the thirteen weeks ended April 29, 2023, we borrowed a net additional $57.8 million on our $290.0 million Revolving Credit Facility to fund normal working capital needs as well as capital expenditures for stores, our eCommerce platform and other information technology investments.

As of April 29, 2023, the net amount outstanding under our Revolving Credit Facility was $179.8 million, all of which is classified as long-term debt on the unaudited Consolidated Balance Sheet and approximately $90.4 million was available for borrowing under our Revolving Credit Facility subject to certain borrowing base limitations and after outstanding letters of credit in the amount of $19.6 million, primarily related to our third party logistics contract. Refer to Note 8 of our unaudited Consolidated Financial Statements included elsewhere in this Quarterly Report for additional information on our Revolving Credit Facility.

CRITICAL ACCOUNTING POLICIES

Management has determined that our most critical accounting policies are those related to store asset impairment, merchandise inventory valuation and valuation allowance on deferred tax assets. We continue to monitor our accounting policies to ensure proper application of current rules and regulations. There have been no significant changes to the policies discussed in our Annual Report.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

INTEREST RATE RISK

Borrowings under our Revolving Credit Facility bears interest at variable rates. See Note 8 to our unaudited Consolidated Financial Statements included elsewhere in this Quarterly Report for further information on the calculation of the rates. The nature and amount of our long-term debt can be expected to vary as a result of our future business requirements, market conditions, and other factors.

As of April 29, 2023, we had approximately $179.8 million in borrowings outstanding under our Revolving Credit Facility. Based on the levels of borrowings under our Revolving Credit Facility at April 29, 2023, we estimate that a hypothetical 100 basis point increase or decrease in underlying interest rates would increase or decrease annual interest expense by approximately $1.8 million. This hypothetical analysis may differ from the actual change in interest expense due to potential changes in interest rates or gross borrowings outstanding under our Revolving Credit Facility.

With the exception of the changes in the levels of borrowings under our Revolving Credit Facility discussed in Note 8 of our unaudited Consolidated Financial Statements included elsewhere in this Quarterly Report, there have been no material changes in our quantitative and qualitative market risks from those disclosed in our Annual Report.

EXPRESS, INC. | Q1 2023 Form 10-Q | 34

ITEM 4. CONTROLS AND PROCEDURES.

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) promulgated under the Exchange Act) that are designed to provide reasonable assurance that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In evaluating the effectiveness of the design and operation of our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable, and not absolute, assurance of achieving the desired control objectives. In reaching a reasonable level of assurance, management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation prior to filing this Quarterly Report of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, our principal executive officer and our principal financial officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of April 29, 2023.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the first quarter of 2023 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

The Company is subject to various claims and contingencies arising in the normal course of its business. Except with respect to the legal proceedings set forth in Note 10 to our unaudited Consolidated Financial Statements included in Part I of this Quarterly Report and incorporated herein by reference, the Company believes that the ultimate liability arising from such claims and contingencies, if any, is not likely to have a material adverse effect on the Company’s results of operations, financial conditions or cash flows.

ITEM 1A. RISK FACTORS.

In addition to the other information set forth in this Quarterly Report, careful consideration should be given to the risk factors set forth in “Item 1A. Risk Factors” of our Annual Report, any of which could materially affect our business, operations, financial position, stock price, or future results. The risks described herein and in our Annual Report, are important to an understanding of the statements made in this Quarterly Report, in our other filings with the SEC, and in any other discussion of our business. These risk factors, which contain forward-looking information, should be read in conjunction with “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations”, and the unaudited Consolidated Financial Statements and related Notes included in this Quarterly Report. Except as set forth below, there have been no material changes to the risk factors described in our Annual Report.

We may not realize the potential benefits of the acquisition of operating assets from Bonobos.

On May 23, 2023, the Company completed the acquisition of the operating assets of the Bonobos business (the “Bonobos Assets”) for a purchase price of $25.0 million. The success of this acquisition, including the expected strategic and financial benefits, will depend, among other things, on our ability to unlock additional growth opportunities for the Bonobos brand and successfully leverage our fully integrated omnichannel operating platform

EXPRESS, INC. | Q1 2023 Form 10-Q | 35

to drive financial synergies and additional economies of scale. We may fail to realize the benefits of the acquisition of the Bonobos assets for a variety of reasons, including: (i) our failure to retain Bonobos’ customers, drive awareness and customer acquisition, (ii) our failure to successfully manage relationships with suppliers; (iii) our failure to fully integrate Bonobos into the Company’s omnichannel operating platform or at a cost or timeline that is greater than originally anticipated; and (iv) our failure to combine product offerings and purchase experiences efficiently and effectively. Failure to achieve the anticipated strategic and financial benefits of the Bonobos acquisition could adversely affect our results of operations, financial condition and cash flows, decrease or delay the accretive effect of the acquisition and negatively impact the price of our common stock.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

The following table provides information regarding the purchase of shares of our common stock made by or on behalf of the Company or any “affiliated purchaser” as defined in Rule 10b-18(a)(3) under the Exchange Act, during each month of the quarterly period ended April 29, 2023:

Month	Total Number of Shares Purchased(1)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased under the Plans or Programs(2)
	(in thousands, except per share amounts)
January 29, 2023 - February 25, 2023	1	$	1.19	—	$	34,215
February 26, 2023 - April 1, 2023	1	$	0.88	—	$	34,215
April 2, 2023 - April 29, 2023	419	$	0.84	—	$	34,215
Total	421			—

1.Represents shares purchased in connection with employee tax withholding obligations under the Second Amended and Restated Express, Inc. 2018 Incentive Compensation Plan (the “2018 Plan”).

2.On November 28, 2017, the Board approved a share repurchase program that authorized the Company to repurchase up to $150.0 million of the Company’s outstanding common stock using available cash. The Company may repurchase shares on the open market, including through Rule 10b5-1 plans, in privately negotiated transactions, through block purchases, or otherwise in compliance with applicable laws, including Rule 10b-18 of the Exchange Act. The timing and amount of stock repurchases will depend on a variety of factors, including business and market conditions as well as corporate and regulatory considerations. The share repurchase program may be suspended, modified, or discontinued at any time, and the Company has no obligation to repurchase any amount of its common stock under the program.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

Not applicable.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

EXPRESS, INC. | Q1 2023 Form 10-Q | 36

ITEM 6. EXHIBITS.

The following exhibits are filed or furnished as part of this Quarterly Report or are incorporated herein by reference.

Exhibit Number	Exhibit Description
10.1*+	Form of Other Cash-Based Award Agreement.
31.1*	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS*	Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).
101.SCH*	Inline XBRL Taxonomy Extension Schema Document.
101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104*	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
* Filed herewith.
+ Indicates a management contract or compensatory plan or arrangement.

EXPRESS, INC. | Q1 2023 Form 10-Q | 37

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date:	June 8, 2023	EXPRESS, INC.
		By:	/s/ Jason Judd
			Jason Judd
			Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer)

EXPRESS, INC. | Q1 2023 Form 10-Q | 38

EX-10.1

Exhibit 10.1

OTHER CASH-BASED

AWARD AGREEMENT

PURSUANT TO THE

AMENDED AND RESTATED

EXPRESS, INC. 2018 INCENTIVE COMPENSATION PLAN

* * * * *

Participant:[_________]

Grant Date:[_________]

Value of Cash-Based Award: [___________]

* * * * *

THIS AWARD AGREEMENT FOR OTHER CASH-BASED AWARDS (this “Agreement”), dated as of the Grant Date specified above, is entered into by and between Express, Inc., a Delaware corporation organized in the State of Delaware (the “Company”), and the Participant specified above, pursuant to the Amended and Restated Express, Inc. 2018 Incentive Compensation Plan, as in effect and as amended from time to time (the “Plan”), which is administered by the Committee; and

WHEREAS, it has been determined under the Plan that it would be in the best interests of the Company to grant to the Participant an Other Cash-Based Award in the target amount set forth above, which will be settled in cash (“Cash Award”).

NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, the parties hereto hereby mutually covenant and agree as follows:

1.Grant of Cash Award.

a.The Company hereby grants to Participant, as of the Grant Date specified above, a target amount of Cash Award as specified above.

b.Participant must accept the terms of this Agreement through the Company’s online acceptance process within sixty days after the Agreement is presented to Participant for review. If Participant does not accept this Agreement through the online acceptance process within sixty days after the Agreement is presented for review, the Company shall automatically accept this Agreement on Participant’s behalf.

2.Plan Terms Control.

a.This Agreement is subject in all respects to the terms of the Plan (including any amendments thereto adopted at any time and from time to time unless such amendments are expressly intended not to apply to the award provided hereunder). All of the terms of the Plan are made a part of and incorporated in this Agreement as if they were each expressly set forth herein. Any capitalized terms not defined in this Agreement shall have the same meaning as is ascribed under the Plan.

b.Participant acknowledges receipt of a true copy of the Plan (which is also filed publicly) and a prospectus describing the material terms of the Plan. Participant has read the Plan carefully and fully understands its content, including the Committee’s broad authority to administer the Plan (as set forth under Article III of the Plan).

c.In the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall control.

1

3.Vesting and Payment.

a.General. The Cash Award is subject to both a time-based vesting condition (as described in Section 3(c)) and a performance-based vesting condition (as described in Section 3(b)), both of which must be satisfied before any portion of the Cash Award will become vested and may be settled in accordance with this Agreement. The Cash Award will not vest (in whole or in part) unless and only to the extent both requirements are satisfied, except as set forth in Section 3(d) and Section 3(e). A maximum of [_____]% of the Target Award may be earned pursuant to the terms of this Agreement, and any portion of the Cash Award that is not earned as a result of the performance conditions stated in Section 3(b) shall be immediately forfeited without consideration upon such determination by the Committee.

b.Performance-Based Vesting. Subject to the provisions of Section 3(c) hereof, the Cash Award subject to this grant shall become tentatively vested based on performance as based on the Company’s achievement of varying levels of cumulative “Adjusted EBITDA” for the [_____]-year performance period beginning on the first day of the Company’s [_____] fiscal year and ending on the last day of the Company’s [_____] fiscal year pursuant to Table 1 below, as modified by relative Total Shareholder Return pursuant to Table 2 below.

TABLE 1

Adjusted EBITDA	Performance Level	Percentage of Cash Award Tentatively Vested Based on Performance
$[___]	Threshold	[_____]
$[___]	Target	[100]%
$[___]	Maximum	[_____]

For purposes hereof, the performance metric of “Adjusted EBITDA” means the Company’s earnings before interest, taxes, depreciation, and amortization and adjusted to exclude the impact of any non-core operating costs consistent with past practice. To the extent that actual Adjusted EBITDA for the performance period hereunder is between the Threshold level and the Target level or between the Target level and the Maximum level, the percentage of Cash Award to become tentatively vested hereunder based on performance shall be determined on a pro rata basis using straight line interpolation; provided that no portion of the Cash Award shall become tentatively vested based on performance if (i) the actual Adjusted EBITDA level achieved for the performance period is less than the Threshold level of performance set forth in the schedule above and provided, further, that the maximum percentage of Cash Award that may become tentatively vested based on performance shall not exceed the percentage set forth in the schedule above corresponding to the Maximum level of performance set forth in the schedule above.

In evaluating the performance conditions set forth above, the Committee may, in its sole discretion, also exclude, or adjust to reflect, the impact of an event or occurrence that the Committee determines should be appropriately excluded or adjusted, including (a) restructurings, discontinued operations, extraordinary items or events, and other unusual or non-recurring charges as described in Accounting Principles Board Opinion No. 30 and/or management’s discussion and analysis of financial condition and results of operations appearing or incorporated by reference in the Company’s Form 10-K for the applicable year; (b) an event either not directly related to the operations of the Company or not within the reasonable control of the Company’s management; or (c) a change in tax law or accounting standards required by generally accepted accounting principles.

TABLE 2

TSR Percentile Rank vs. Peer Group	TSR Modification to Table 1 Result
</= 25th	-25%
Between 25th and 75th	None
>/= 75th	+25%

As noted above, the extent to which the performance goal is met based on Adjusted EBITDA performance shall be subject to modification based on relative Total Shareholder Return as provided in Table 2, For the purposes hereof, the performance metric of “TSR Percentile Rank vs. Peer Group” means the Company’s performance based on

2

relative TSR compared to the Dow Jones US Retail Apparel Index (the “Peer Group”) during the period beginning on the first day of the Company’s [_____] fiscal year and ending on the last day of the Company’s [_____] fiscal year. No interpolation shall be applied with respect to TSR performance below, within, or above the levels set forth above; and provided, further, that no adjustment pursuant to Table 2 shall increase the percentage determined pursuant to Table 1 above the Maximum [_____]% level.

c.Time-Based Vesting. To the extent that the Cash Award becomes tentatively vested based on performance pursuant to Section 3(b) hereof, such tentatively vested Cash Award shall become fully vested pursuant to the schedule set forth in the table below, provided that the Participant has not incurred a Termination prior to the vesting date:

Vesting Date	Cumulative Percentage of Award to Become Fully Vested
[_____]	100%

There shall be no proportionate or partial vesting under this Section 3(c) in the periods prior to each vesting date and all vesting under this Section 3(c) shall occur only on the vesting date, subject to the Participant’s continued service with the Company or any of its Subsidiaries from the Grant Date to the vesting date.

d.Death or Disability Terminations. Notwithstanding Section 3(a), Section 3(b) and Section 3(c), in the event of Termination due to (i) the Participant’s death or (ii) the Participant’s Disability, the unvested portion of the Cash Award outstanding hereunder as of the date of such Termination shall become fully vested as of the date of such Termination as follows:

i.Prior to Completion of Performance Period. In the event that such Termination occurs prior to the completion of the applicable performance period under Section 3(b), the unvested portion of the Cash Award outstanding hereunder as of the date of such Termination shall become fully vested as of the date of such Termination at the target performance level of achievement under Section 3(b) without regard to the vesting provisions under Section 3(c).

ii.On or After Completion of Performance Period. In the event that such Termination occurs on or after the completion of the applicable performance period under Section 3(b), the unvested portion of the Cash Award outstanding hereunder as of the date of such Termination that have previously become tentatively vested under Section 3(b) shall become fully vested as of the date of such Termination without regard to the vesting provisions under Section 3(c).

e.Retirement. Notwithstanding Section 3(a), Section 3(b) and Section 3(c), in the event of the Participant’s Termination due to “Retirement” (as defined below), the unvested portion of the Cash Award subject to this grant as of the date of such Termination shall be subject to the following provisions:

i.Prior to Completion of Performance Period. In the event that such Termination occurs prior to the completion of the applicable performance period under Section 3(b), the unvested portion of the Cash Award subject to this grant as of the date of such Termination that shall be eligible to become vested under Section 3(b) shall be determined on a pro rata basis by multiplying the unvested portion of the Cash Award outstanding hereunder that could become vested on the vesting date set forth in Section 3(c) by a fraction, the numerator of which is the number of days in which the Participant was employed by the Company or its Subsidiaries for the period commencing on the Grand Date and continuing through the date of such Termination, and the denominator of which is the number of days in the period commencing on the Grant Date and ending on the vesting date set forth in Section 3(c). Thereafter, the portion of the Cash Award eligible to vest under Section 3(b), after taking into account the reduction contemplated by this Section 3(e)(i), shall become fully vested upon completion of the applicable performance period provided in Section 3(b) based on actual performance during such performance period in accordance with the provisions of Section 3(b).

3

ii.On or After Completion of Performance Period. In the event that such Termination occurs on or after the completion of the applicable performance period under Section 3(b), the unvested portion of the Cash Award outstanding hereunder as of the date of such Termination that have previously become tentatively vested under Section 3(b) shall become fully vested as of the date of such Termination on a pro rata basis determined by multiplying the unvested portion of the Cash Award outstanding hereunder that are scheduled to become fully vested under Section 3(c) on the vesting date set forth in Section 3(c) by a fraction, the numerator of which is the number of days in which the Participant was employed by the Company or its Subsidiaries for the period commencing on the Grant Date and continuing through the date of such Termination, and the denominator of which is the number of days in the period commencing on the Grant Date and ending on the vesting date set forth in Section 3(c).

For purposes hereof, the term “Retirement” shall mean any Termination by the Participant, other than a Termination for Cause, death or Disability, at or after age fifty-five (55) and when the Participant has at least ten (10) years of full-time continuous service with the Company or any of its Subsidiaries.

f.Effect of Detrimental Activity. The provisions of Section 10.4 of the Plan regarding Detrimental Activity shall apply to the Participant and the Cash Award, and the provisions thereof are hereby incorporated by reference into this Agreement.

g.Recoupment. For the avoidance of doubt, Section 14.23 of the Plan, regarding recoupment and clawback of Awards under the Plan, shall apply to the Participant and the Cash Award, and the provisions thereof are hereby incorporated by reference into this Agreement.

h.Forfeiture. Subject to Section 3(d) and Section 3(e), the entire unvested portion of the Cash Award shall be immediately forfeited upon the Participant’s Termination for any reason.

4.Award Settlement. Subject to the provisions of the Plan, the Company shall deliver to the Participant on the first payroll date following the date on which each Cash Award becomes fully vested hereunder, but in no event later than thirty days after such date, a lump sum cash payment equal to the applicable percentage of the Cash Award as of the vesting date, in each case less any amounts required to satisfy any federal, state or local taxes required by law to be withheld. In no event shall a Participant be entitled to receive any cash distribution with respect to any unvested or forfeited portion of the Cash Award. For avoidance of doubt, in the event of a distribution in connection with Retirement, such distribution may be delayed pursuant to Section 14.16 of the Plan if Participant is a “specified employee” at the time of such Retirement.

5.Non-transferability. The Cash Award, and any rights and interests with respect thereto, issued under this Agreement and the Plan shall not be sold, exchanged, transferred, assigned or otherwise disposed of in any way by the Participant (or any beneficiary(ies) of the Participant), other than by testamentary disposition by the Participant or the laws of descent and distribution. Any attempt to sell, exchange, transfer, assign, pledge, encumber or otherwise dispose of or hypothecate in any way the Cash Award, or the levy of any execution, attachment or similar legal process upon the Cash Award, contrary to the terms and provisions of this Agreement and/or the Plan shall be null and void and without legal force or effect.

6.Governing Law. All questions concerning the construction, validity and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to the choice of law principles thereof.

7.Withholding of Tax. The Company shall have the power and the right to deduct or withhold, or require the Participant to remit to the Company, an amount sufficient to satisfy any federal, state, local and foreign taxes of any kind (including, but not limited to, the Participant’s FICA and SDI obligations) which the Company, in its sole discretion, deems necessary to be withheld or remitted to comply with the Code and/or any other applicable law, rule or regulation with respect to the Cash Award. Any statutorily required withholding obligation with regard to the Participant may, unless not permitted by the Committee, be satisfied by reducing the amount of cash otherwise deliverable to the Participant hereunder, and any additional tax withholding permitted by the Committee up to the maximum permissible withholding may be satisfied similarly provided such reduction would not cause adverse accounting or tax consequences to the Company.

4

8.Entire Agreement; Amendment. This Agreement, together with the Plan, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. The Committee shall have the right, in its sole discretion, to modify or amend this Agreement from time to time in accordance with and as provided in the Plan. This Agreement may also be modified or amended by a writing signed by both the Company and the Participant. The Company shall give written notice to the Participant of any such modification or amendment of this Agreement as soon as practicable after the adoption thereof.

9.Notices. Any notice hereunder by the Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel of the Company. Any notice hereunder by the Company shall be given to the Participant in writing and such notice shall be deemed duly given only upon receipt thereof at such address as the Participant may have on file with the Company.

10.No Right to Employment. Any questions as to whether and when there has been a Termination and the cause of such Termination shall be determined in the sole discretion of the Committee. Nothing in this Agreement shall interfere with or limit in any way the right of the Company, its Subsidiaries or their respective Affiliates to terminate the Participant’s employment or service at any time, for any reason and with or without cause.

11.Transfer of Personal Data. The Participant authorizes, agrees and unambiguously consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the Cash Award granted under this Agreement for legitimate business purposes (including, without limitation, the administration of the Plan). This authorization and consent is freely given by the Participant.

12.Compliance with Laws. This issuance of Cash Award pursuant to this Agreement shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including the Exchange Act and the Securities Act) and any other law or regulation applicable thereto.

13.Binding Agreement; Assignment. This Agreement shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. The Participant shall not assign (except as provided by Section 5 hereof) any part of this Agreement without the prior express written consent of the Company.

14.Headings. The titles and headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Agreement.

15.Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.

16.Further Assurances. Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the Plan and the consummation of the transactions contemplated thereunder.

17.Severability; Waiver. The invalidity or unenforceability of any provisions of this Agreement in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law. The waiver by any party to this Agreement of a breach of any term of the Agreement shall not operate or be construed as a waiver of any other subsequent breach.

18.Acquired Rights. The Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time; (b) the grant of the Cash Award made under this Agreement is completely independent of any other award or grant and is made at the sole discretion of the Company; (c) no past grants or awards (including, without limitation, the Cash Award granted hereunder) give the Participant any right to any grants or awards in the future whatsoever; and (d) any benefits granted under this Agreement

5

are not part of the Participant’s ordinary salary, and shall not be considered as part of such salary in the event of severance, redundancy or resignation.

19.Electronic Delivery and Acceptance. The Company may deliver any documents related to current or future participation in the Plan by electronic means. Participant consents to receive those documents by electronic delivery and to participate in the Plan through any on-line or electronic system established and maintained by the Company or a third party designated by the Company.

[Remainder of page intentionally left blank.]

6

By selecting the signature button below, Participant is signing this Agreement electronically and agreeing that Participant’s electronic signature is the legal equivalent of a manual signature on this Agreement. In addition, Participant is agreeing to the terms of this Agreement, as of the Grant Date.

7

EX-31.1

EXHIBIT 31.1

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Timothy Baxter, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Express, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	June 8, 2023	By:	/s/ Timothy Baxter
			Timothy Baxter
			Chief Executive Officer

EX-31.2

EXHIBIT 31.2

CERTIFICATION PURSUANT TO SECTION 302

OF THE SARBANES-OXLEY ACT OF 2002

I, Jason Judd, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Express, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	June 8, 2023	By:	/s/ Jason Judd
			Jason Judd
			Senior Vice President, Chief Financial Officer and Treasurer

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Express, Inc. (the "Company") on Form 10-Q for the quarter ended April 29, 2023 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), the undersigned Timothy Baxter, Chief Executive Officer of the Company, and Jason Judd, Senior Vice President, Chief Financial Officer and Treasurer of the Company, hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of each of our knowledge:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the consolidated financial condition and results of operations of the Company and its subsidiaries.

Date: June 8, 2023

/s/ Timothy Baxter

Timothy Baxter

Chief Executive Officer

/s/ Jason Judd

Jason Judd

Senior Vice President, Chief Financial Officer and Treasurer

XML

Cover Page - shares	3 Months Ended
	Apr. 29, 2023	May 27, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Apr. 29, 2023
Document Transition Report	false
Entity File Number	001-34742
Entity Registrant Name	EXPRESS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	26-2828128
Entity Address, Address Line One	1 Express Drive
Entity Address, City or Town	Columbus
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	43230
City Area Code	614
Local Phone Number	474-4001
Title of 12(b) Security	Common Stock, $.01 par value
Trading Symbol	EXPR
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Outstanding (in shares)		74,592,956
Entity Central Index Key	0001483510
Current Fiscal Year End Date	--02-03
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 29, 2023	Jan. 28, 2023
Current Assets:
Cash and cash equivalents	$ 34,092	$ 65,612
Receivables, net	17,106	12,374
Income tax receivable	1,140	1,462
Inventories	346,963	365,649
Prepaid royalty	47,146	59,565
Prepaid rent	5,762	7,744
Other	25,628	21,998
Total current assets	477,837	534,404
Right of Use Asset, Net	522,922	505,350
Property and Equipment	1,022,132	1,019,577
Less: accumulated depreciation	(894,020)	(886,193)
Property and equipment, net	128,112	133,384
Non-Current Income Tax Receivable	52,278	52,278
Equity Method Investment	166,210	166,106
Other Assets	6,342	6,803
TOTAL ASSETS	1,353,701	1,398,325
Current Liabilities:
Short-term lease liability	197,944	189,006
Accounts payable	162,369	191,386
Deferred royalty income	15,412	19,852
Deferred revenue	33,243	35,543
Accrued expenses	101,243	105,803
Total current liabilities	510,211	541,590
Long-Term Lease Liability	408,006	406,448
Long-Term Debt	179,750	122,000
Other Long-Term Liabilities	20,075	20,718
Total Liabilities	1,118,042	1,090,756
Commitments and Contingencies (Note 10)
Stockholders’ Equity:
Preferred stock – $0.01 par value; 10,000 shares authorized; no shares issued or outstanding	0	0
Common stock – $0.01 par value; 500,000 shares authorized; 99,067 shares and 99,067 shares issued at April 29, 2023 and January 28, 2023, respectively, and 74,571 shares and 73,760 shares outstanding at April 29, 2023 and January 28, 2023, respectively	990	990
Additional paid-in capital	229,468	228,633
Retained earnings	269,812	355,736
Treasury stock – at average cost; 24,496 shares and 25,307 shares at April 29, 2023 and January 28, 2023, respectively	(264,611)	(277,790)
Total stockholders’ equity	235,659	307,569
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$ 1,353,701	$ 1,398,325

XML

Consolidated Balance Sheets (Parentheticals) - $ / shares	Apr. 29, 2023	Jan. 28, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value (in USD per share)	$ 0.01	$ 0.01
Preferred stock, authorized (in shares)	10,000,000	10,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in USD per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	500,000,000	500,000,000
Common stock, issued (in shares)	99,067,000	99,067,000
Common stock, outstanding (in shares)	74,571,000	73,760,000
Treasury stock (in shares)	24,496,000	25,307,000

XML

Consolidated Statements of Income and Comprehensive Income - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Income Statement [Abstract]
Net Sales	$ 383,257	$ 450,785
Cost of Goods Sold, Buying and Occupancy Costs	319,464	319,285
GROSS PROFIT	63,793	131,500
Operating Expenses (Income):
Selling, general, and administrative expenses	139,348	141,093
Royalty income	(4,440)	0
Other operating income, net	(1,000)	(490)
TOTAL OPERATING EXPENSES	133,908	140,603
OPERATING LOSS	(70,115)	(9,103)
Interest Expense, Net	2,943	3,494
Other Income, Net	0	(200)
LOSS BEFORE INCOME TAXES	(73,058)	(12,397)
Income Tax Expense (Benefit)	369	(483)
NET LOSS	(73,427)	(11,914)
COMPREHENSIVE LOSS	$ (73,427)	$ (11,914)
EARNINGS PER SHARE:
Basic (in USD per share)	$ (0.99)	$ (0.18)
Diluted (in USD per share)	$ (0.99)	$ (0.18)
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic (in shares)	73,878	67,211
Diluted (in shares)	73,878	67,211

XML

Consolidated Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Treasury Stock
Balance, at start of period (in shares) at Jan. 29, 2022		67,072,000
Balance, at start of period at Jan. 29, 2022	$ 1,308	$ 936	$ 220,078	$ 77,093	$ 0	$ (296,799)
Balance, at start of period, treasury stock (in shares) at Jan. 29, 2022						26,560,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(11,914)			(11,914)
Exercise of stock options and vesting of restricted stock (in shares)		1,520,000				(1,520,000)
Exercise of stock options and vesting of restricted stock	0		(5,038)	(11,935)		$ 16,973
Share-based compensation	$ 2,393		2,393
Repurchase of common stock (in shares)	0	570,000				570,000
Repurchase of common stock	$ (1,890)					$ (1,890)
Balance, at end of period (in shares) at Apr. 30, 2022		68,022,000
Balance, at end of period at Apr. 30, 2022	$ (10,103)	$ 936	217,433	53,244	0	$ (281,716)
Balance, at end of period, treasury stock (in shares) at Apr. 30, 2022						25,610,000
Balance, at start of period (in shares) at Jan. 28, 2023	73,760,000	73,760,000
Balance, at start of period at Jan. 28, 2023	$ 307,569	$ 990	228,633	355,736	0	$ (277,790)
Balance, at start of period, treasury stock (in shares) at Jan. 28, 2023	25,307,000					25,307,000
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	$ (73,427)			(73,427)
Exercise of stock options and vesting of restricted stock (in shares)		1,232,000				(1,232,000)
Exercise of stock options and vesting of restricted stock	0		(1,036)	(12,497)		$ 13,533
Share-based compensation	$ 1,871		1,871
Repurchase of common stock (in shares)	0	421,000				421,000
Repurchase of common stock	$ (354)					$ (354)
Balance, at end of period (in shares) at Apr. 29, 2023	74,571,000	74,571,000
Balance, at end of period at Apr. 29, 2023	$ 235,659	$ 990	$ 229,468	$ 269,812	$ 0	$ (264,611)
Balance, at end of period, treasury stock (in shares) at Apr. 29, 2023	24,496,000					24,496,000

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (73,427)	$ (11,914)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	14,405	15,172
Loss on disposal of property and equipment	0	10
Share-based compensation	1,871	2,393
Landlord allowance amortization	(58)	(157)
Changes in operating assets and liabilities:
Receivables, net	(4,732)	2,413
Income tax receivable	322	(463)
Prepaid royalty	12,419	0
Inventories	18,686	(12,454)
Deferred royalty income	(4,440)	0
Accounts payable, deferred revenue, and accrued expenses	(37,370)	(53,989)
Other assets and liabilities	(8,288)	(16,890)
NET CASH USED IN OPERATING ACTIVITIES	(80,612)	(75,879)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures	(8,200)	(5,142)
Costs related to WHP transaction	(104)	0
NET CASH USED IN INVESTING ACTIVITIES	(8,304)	(5,142)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings under the revolving credit facility	142,250	117,000
Repayment of borrowings under the revolving credit facility	(84,500)	(37,000)
Repayment of borrowings under the term loan facility	0	(1,125)
Repurchase of common stock for tax withholding obligations	(354)	(1,890)
NET CASH PROVIDED BY FINANCING ACTIVITIES	57,396	76,985
NET DECREASE IN CASH AND CASH EQUIVALENTS	(31,520)	(4,036)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD	65,612	41,176
CASH AND CASH EQUIVALENTS, END OF PERIOD	$ 34,092	$ 37,140

XML

Description of Business and Basis of Presentation

3 Months Ended

Apr. 29, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business and Basis of Presentation

NOTE 1 | DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Business Description

Express, Inc., together with its subsidiaries (“Express” or the “Company”), is a multi-brand fashion retailer whose portfolio includes Express and UpWest. The Company operates an omnichannel platform, including both physical and online stores. Grounded in a belief that style, quality and value should all be found in one place, Express is a brand with a purpose - We Create Confidence. We Inspire Self-Expression. - powered by a styling community. UpWest is an apparel, accessories and home goods brand with a purpose to Provide Comfort for People & Planet.

As of April 29, 2023, the Company operated 545 retail and factory outlet stores in the United States and Puerto Rico, the Express.com online store, the Express mobile app and the UpWest.com online store. As of April 29, 2023, the composition of Express operated stores was as follows:

	Store Count
EXPRESS
Retail stores1	337
Factory Outlet stores	195
Total Retail and Factory Outlet stores	532
UpWest	13
Total stores	545

1.As of April 29, 2023, retail store count includes 10 Express Edit stores

WHP Strategic Partnership

In the fourth quarter of 2022, Express closed the strategic partnership with WHP Global (“WHP”), a leading global brand management firm. The mutually transformative strategic partnership advances the Company's omnichannel platform which is expected to drive accelerated, long-term growth through the acquisition and operation of a portfolio of brands. In connection with the closing of this transaction in January 2023, the Company and WHP also formed a joint venture (the “Joint Venture”), intended to scale the Express brand through new domestic category licensing and international expansion opportunities. Refer to Note 5 for further discussion regarding the WHP strategic partnership.

Fiscal Year

The Company's fiscal year ends on the Saturday closest to January 31. Fiscal years are designated in the unaudited Consolidated Financial Statements and Notes, as well as the remainder of this Quarterly Report, by the calendar year in which the fiscal year commences. All references herein to the Company's fiscal years are as follows:

Fiscal Year	Year Ended	Number of Weeks
2023	February 3, 2024	53
2022	January 28, 2023	52

All references herein to “the first quarter of 2023” and “the first quarter of 2022” represent the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively.

Basis of Presentation

The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and the U.S. Securities and Exchange Commission’s Article 10, Regulation S-X and therefore do not include all of the information or footnotes required for complete financial statements. In the opinion of management, the accompanying unaudited Consolidated Financial Statements reflect all adjustments (which are of a normal recurring nature) necessary to state fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the Company's future interim periods or 2023 fiscal year. Therefore, these statements should be read in conjunction with the

Consolidated Financial Statements and Notes thereto for the year ended January 28, 2023, included in the Annual Report.

Express, Inc., through its indirect, wholly owned subsidiaries, including Express Fashion Operations, LLC, conducts the operations of the Company and Express Fashion Investments, LLC which owns a 40% economic interest with significant influence in the Joint Venture.

Principles of Consolidation

The unaudited Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. The Company indirectly holds a 40% equity method interest in the Joint Venture, which is majority owned by WH Borrower, LLC, an affiliate of WHP. All intercompany transactions and balances have been eliminated in consolidation.

Segment Reporting    

The Company defines an operating segment on the same basis that it uses to evaluate performance internally. The Company has determined that its Chief Executive Officer is the Chief Operating Decision Maker, and that there is one operating segment. Therefore, the Company reports results as a single segment, which includes the operation of its Express and UpWest brick-and-mortar retail and outlet stores and eCommerce operations.

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenue and expense during the reporting period, as well as the related disclosure of contingent assets and liabilities as of the date of the unaudited Consolidated Financial Statements. Actual results may differ from those estimates. The Company revises its estimates and assumptions as new information becomes available.

Going Concern and Management’s Plans

The Company’s revenues, results of operations and cash flows have been materially adversely impacted by negative macroeconomic factors beginning in the third and fourth quarters of 2022 and continuing into the first quarter of 2023. The persistently challenging macroeconomic and retail apparel environments, including reduced consumer spending and increased price sensitivity in discretionary categories, has significantly impacted the Company's performance. Net sales during the first quarter of 2023 decreased approximately $67.5 million compared to the first quarter of 2022 and this decline, coupled with an increase in promotional activity, drove gross margin and operating loss below the Company's expectations. For the first quarter of 2023, the Company reported a net operating loss of $70.1 million and negative operating cash flows of $80.6 million.

As of April 29, 2023, the Company was in compliance with the covenants under the agreements governing its indebtedness, however, due to the uncertainty in the Company’s business, the Company could experience material further decreases to revenues and cash flows and may experience difficulty remaining in compliance with such covenants. Refer to Note 8 for further details regarding the terms of the ABL Credit Agreement and the Revolving Credit Facility provided to the Company thereunder.

When conditions and events, in the aggregate, impact an entity's ability to continue as a going concern, management evaluates the mitigating effect of its plans to determine if it is probable that the plans will be effectively implemented and, when implemented, the plans will mitigate the relevant conditions or events.

The Company's plans are focused on improving its results and liquidity through additional expense savings and improved sales trends as we move through the balance of fiscal year 2023. The Company is committed to finding significant additional expense savings which are expected to benefit the second half of fiscal 2023 and full fiscal year 2024, and has engaged external advisors to assist in analyzing and identifying both potential margin expansion and further expense saving opportunities. Additionally, the Company has contingency plans which would further reduce or defer additional expenses and cash outlays should operations weaken beyond current forecasts. The Company believes these plans are probable of being successfully implemented, which will result in adequate cash flows to support its ongoing operations and to meet its financial covenant requirements under the agreements governing its indebtedness for at least one year following the date these financial statements are issued.

The accompanying unaudited Consolidated Financial Statements are prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

XML

Revenue Recognition

3 Months Ended

Apr. 29, 2023

Revenue from Contract with Customer [Abstract]

Revenue Recognition

NOTE 2 | REVENUE RECOGNITION

The following is information regarding the Company’s major product categories and sales channels:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Apparel	$	344,000	$	401,286
Accessories and other	26,193		35,478
Other revenue	13,064		14,021
Total net sales	$	383,257	$	450,785

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Retail	$	274,256	$	320,877
Outlet	95,937		115,887
Other revenue	13,064		14,021
Total net sales	$	383,257	$	450,785

Other revenue consists primarily of revenue earned from our private label credit card agreement, shipping and handling revenue related to eCommerce activity, sell-off revenue related to marked-out-of-stock inventory sales to third parties and revenue from gift card breakage.

Merchandise Sales

The Company recognizes sales for in-store purchases at the point-of-sale. Revenue related to eCommerce transactions is recognized upon shipment based on the fact that control transfers to the customer at that time. The Company has made a policy election to treat shipping and handling as costs to fulfill the contract, and as a result, any amounts received from customers are included in the transaction price allocated to the performance obligation of providing goods with a corresponding amount accrued within cost of goods sold, buying and occupancy costs in the unaudited Consolidated Statements of Income and Comprehensive Income for amounts paid to applicable carriers. Associate discounts on merchandise purchases are classified as a reduction of net sales. Net sales excludes sales tax collected from customers and remitted to governmental authorities.

Loyalty Program

The Company maintains a customer loyalty program in which customers earn points toward rewards for qualifying purchases and other marketing activities. Upon reaching specified point values, customers are issued a reward, which they may redeem on merchandise purchases at the Company’s stores or on its website. Generally, rewards earned must be redeemed within 60 days from the date of issuance. The Company defers a portion of merchandise sales based on the estimated standalone selling price of the points earned. This deferred revenue is recognized as certificates are redeemed or expire. To calculate this deferral, the Company makes assumptions related to loyalty point and certificate redemption rates based on historical experience. The loyalty liability is included in deferred revenue on the unaudited Consolidated Balance Sheets.

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning balance loyalty deferred revenue	$	9,939	$	10,918
Net revenue recognized	(540)		(1,562)
Ending balance loyalty deferred revenue	$	9,399	$	9,356

Sales Returns Reserve

The Company reduces net sales and provides a reserve for projected merchandise returns based on prior experience. Merchandise returns are often resalable merchandise and are refunded by issuing the same payment tender as the original purchase. The sales returns reserve was $14.9 million and $9.0 million as of April 29, 2023 and January 28, 2023, respectively, and is included in accrued expenses on the unaudited Consolidated Balance Sheets. The asset related to projected returned merchandise is included in other assets on the unaudited Consolidated Balance Sheets.

Gift Cards

The Company sells gift cards in its stores, on its eCommerce website, and through third parties. These gift cards do not expire or lose value over periods of inactivity. The Company accounts for gift cards by recognizing a liability at the time a gift card is sold. The gift card liability balance was $23.7 million and $25.6 million, as of April 29, 2023 and January 28, 2023, respectively, and is included in deferred revenue on the unaudited Consolidated Balance Sheets. During the thirteen weeks ended April 29, 2023 and April 30, 2022, the Company recognized approximately $3.7 million and $4.3 million of revenue that was previously included in the beginning gift card contract liability, respectively. The Company recognizes revenue from gift cards when they are redeemed by the customer. The Company also recognizes income on unredeemed gift cards, referred to as “gift card breakage.” Gift card breakage is recognized proportionately using a time-based attribution method from issuance of the gift card to the time when it can be determined that the likelihood of the gift card being redeemed is remote and that there is no legal obligation to remit unredeemed gift cards to relevant jurisdictions. The gift card breakage rate is based on historical redemption patterns. Gift card breakage is included within the other revenue component of net sales in the unaudited Consolidated Statements of Income and Comprehensive Income.

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning gift card liability	$	25,604	$	25,066
Issuances	4,983		6,083
Redemptions	(6,100)		(7,006)
Gift card breakage	(831)		(855)
Ending gift card liability	$	23,656	$	23,288

Private Label Credit Card

The Company has an agreement with Comenity Bank (the “Bank”) to provide customers with private label credit cards (as amended, the “Card Agreement”). The term of the Card Agreement expires on December 31, 2024. Each private label credit card bears the logo of the Express brand and can only be used at the Company’s store locations and eCommerce channel. The Bank is the sole owner of the accounts issued under the private label credit card program and absorbs the losses associated with non-payment by the private label card holders and a portion of any fraudulent usage of the accounts.

Pursuant to the Card Agreement, the Company receives amounts from the Bank during the term based on a percentage of private label credit card sales and is also eligible to receive incentive payments for the achievement of certain performance targets. These funds are recorded within the other revenue component of net sales in the unaudited Consolidated Statements of Income and Comprehensive Income. The Company also receives reimbursement funds from the Bank for certain expenses the Company incurs. These reimbursement funds are

used by the Company to fund marketing and other programs associated with the private label credit card. The reimbursement funds received related to private label credit cards are recorded within the other revenue component of net sales in the Consolidated Statements of Income and Comprehensive Income.

In connection with the Card Agreement, the Bank paid the Company a $20.0 million refundable payment which the Company recognized upon receipt as deferred revenue within other long-term liabilities in the Consolidated Balance Sheets and began to recognize into income on a straight-line basis commencing January of 2018. As of April 29, 2023, the deferred revenue balance of $4.8 million will be recognized over the remaining term of the Card Agreement within the other revenue component of net sales.

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning balance refundable payment liability	$	5,516	$	8,394
Recognized in revenue	(719)		(719)
Ending balance refundable payment liability	$	4,797	$	7,675

XML

Earnings Per Share

3 Months Ended

Apr. 29, 2023

Earnings Per Share [Abstract]

Earnings Per Share

NOTE 3 | EARNINGS PER SHARE

The following table provides a reconciliation between basic and diluted weighted-average shares used to calculate basic and diluted earnings per share:

	Thirteen Weeks Ended
	April 29, 2023	April 30, 2022
	(in thousands)
Weighted-average shares - basic	73,878	67,211
Dilutive effect of stock options and restricted stock units	—	—
Weighted-average shares - diluted	73,878	67,211

Equity awards representing 4.3 million and 6.8 million shares of common stock were excluded from the computation of diluted earnings per share for the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively, as the inclusion of these awards would have been anti-dilutive.

Additionally, for the thirteen weeks ended April 29, 2023, equity awards representing 2.9 million shares were excluded from the computation of diluted weighted average shares because the number of shares that will ultimately be issued is contingent on the Company’s performance compared to pre-established performance goals which had not been achieved as of April 29, 2023.

XML

Fair Value Measurements

3 Months Ended

Apr. 29, 2023

Fair Value Disclosures [Abstract]

Fair Value Measurements

NOTE 4 | FAIR VALUE MEASUREMENTS

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date.

■Level 1 - Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities in active markets.

■Level 2 - Valuation is based upon quoted prices for similar assets and liabilities in active markets or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

■Level 3 - Valuation is based upon other unobservable inputs that are significant to the fair value measurement.

Financial Assets

The following table presents the Company's financial assets, recorded in cash and cash equivalents on the unaudited Consolidated Balance Sheets, measured at fair value on a recurring basis as of April 29, 2023 and January 28, 2023, aggregated by the level in the fair value hierarchy.

	April 29, 2023
	Level 1		Level 2		Level 3
	(in thousands)
Money market funds	$	—	$	—	$	—
	January 28, 2023
	Level 1		Level 2		Level 3
	(in thousands)
Money market funds	$	47,792	$	—	$	—

The money market funds are valued using quoted market prices in active markets.

Non-Financial Assets

The Company's non-financial assets, which include fixtures, equipment, improvements, right of use assets, and an equity method investment, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur indicating the carrying value of these assets may not be recoverable, or annually in the case of indefinite-lived intangibles, an impairment test is required to be performed by the Company.

The carrying amounts reflected on the unaudited Consolidated Balance Sheets for the remaining cash, cash equivalents, receivables, prepaid expenses, and payables as of April 29, 2023 and January 28, 2023 approximated their fair values. The equity method investment is reflected at cost, and is the result of a market participant transaction with WHP whereby the Company received proceeds of $260.0 million and a 40% ownership interest in the Joint Venture in exchange for contributing certain intellectual property to the Joint Venture.

The Company reviews its equity method investment by comparing its fair value to its carrying value. If the carrying value of the investment exceeds its fair value and the loss in value is other than temporary, the investment is considered impaired and reduced to fair value, and the impairment is recognized in the period identified. Factors providing evidence of such a loss include changes in the investee's operations or financial condition, significant continuing losses, significant negative economic conditions or a significant decrease in the market value. Impairment charges are recorded in other expense (income), net in the unaudited Consolidated Statements of Income and Comprehensive Income.

Store Asset Impairment

Property and equipment, including the right of use assets, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur indicating the carrying value of these assets may not be recoverable, an impairment test is required. These events include, but are not limited to, material adverse changes in projected revenues, present cash flow losses combined with a history of cash flow losses and a forecast that demonstrates significant continuing losses, significant negative economic conditions, a significant decrease in the market value of an asset and store closure or relocation decisions. The reviews are conducted at the store level, the lowest identifiable level of cash flow.

Stores that display an indicator of impairment are subjected to an impairment assessment. Such stores are tested for recoverability by comparing the sum of the estimated future undiscounted cash flows to the carrying amount of the asset. This recoverability test requires management to make assumptions and judgments related, but not limited, to management’s expectations for future cash flows from operating the store.

▪The key assumption used in the undiscounted future store cash flow models is the sales growth rate.

An impairment loss may be recognized when these undiscounted future cash flows are less than the carrying amount of the asset group. In the circumstance of impairment, any loss would be measured as the excess of the

carrying amount of the asset group over its fair value. Fair value of the store-related assets is determined at the individual store level based on the highest and best use of the asset group.

▪The key assumptions used in the fair value analysis may include discounted estimates of future store cash flows from operating the store and/or comparable market rents.

Impairment charges are recorded in cost of goods sold, buying and occupancy costs in the unaudited Consolidated Statements of Income and Comprehensive Income.

During the thirteen weeks ended April 29, 2023 and April 30, 2022, the Company did not recognize any impairment charges.

XML

Equity Method Investment

3 Months Ended

Apr. 29, 2023

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investment

NOTE 5 | EQUITY METHOD INVESTMENT

The following table is a summary of the Company’s equity method investment with WHP:

	% of Ownership	Balance Sheet Location	April 29, 2023
			(in thousands)
EXP Topco, LLC.	40%	Equity Method Investment	$	166,210

The Company accounts for its 40% economic interest in the Joint Venture, through which it exercises significant influence but does not have control over the investee, under the equity method. Under the equity method, the Company records its investment in the investee on the balance sheet initially at cost, and subsequently adjusts the carrying amount based on its share of the investee's net income or loss. Royalty distributions received from the investee are recognized as a reduction of the carrying amount of the investment. The Company's share of equity (income) losses and other adjustments associated with this equity method investment is included in royalty income in the unaudited Consolidated Statements of Income and Comprehensive Income. The carrying value for the Company's equity investment is reported in Equity Method Investment on the unaudited Consolidated Balance Sheets. The Company reports its share of earnings using a one-month lag because results are not available in time for it to record them in the concurrent period. This convention has not historically materially impacted the Company's results.

Equity Method Investment with WHP

On January 25, 2023, the Company closed the strategic partnership transaction with WHP. Pursuant to the transaction, the Company formed the Joint Venture and contributed certain intellectual property of the Company in exchange for 40% ownership of the Joint Venture. WHP invested $235.0 million for 60% ownership of the Joint Venture, implying a fair value of the Company’s retained 40% interest of approximately $156.7 million.

During the fourth quarter of 2022, under the derecognition guidance from ASC Topic 810, Consolidation, the Company derecognized the intellectual property assets at their carrying amount upon their contribution to the Joint Venture. Because the carrying amount of the contributed intellectual property assets was zero, a $391.7 million gain was recognized at the time of contribution, of which $156.7 million was related to the Company’s 40% interest in the Joint Venture. The gain was recorded in gain on transaction with WHP on the Consolidated Statements of Income and Comprehensive Income. Transaction costs capitalized in the cost of the equity method investment totaled $9.4 million.

Separately, under the terms of the transaction, the Company and WHP entered into an investment agreement (the “Investment Agreement”) pursuant to which an affiliate of WHP acquired 5.4 million newly issued shares of the Company’s common stock at a purchase price of $4.60 per share, representing an approximate pro forma ownership of 7.4% of the Company's outstanding shares of common stock. The difference between the purchase price paid and the trading price of the Company’s common stock on the day of the completion of the transaction resulted in a gain of $17.8 million recorded in gain on transaction with WHP on the Consolidated Statements of Income and Comprehensive Income.

In connection with the strategic partnership with WHP, on January 25, 2023, the Company and the Joint Venture entered into an Intellectual Property License Agreement (the “License Agreement”). The License Agreement provides the Company with an exclusive license in the United States to the intellectual property contributed in

connection with the Membership Interest Purchase Agreement and certain other intellectual property. The initial term of the License Agreement is 10 years, and the License Agreement automatically renews for successive renewal terms of 10 years (unless the Company provides notice of non-renewal at least 24 months prior to the end of the initial or applicable renewal term). Except for the Company’s right not to renew the License Agreement, the License Agreement is not terminable by either party. The Company will pay the Joint Venture a royalty on net sales of certain licensed goods and will commit to an annual guaranteed minimum annual royalty during the term of the License Agreement (i.e., $60.0 million in the first contract year, increasing by $1.0 million per year for the next five contract years, and remaining at $65.0 million following the sixth contract year). The Company will pay royalties at a rate of (i) 3.25% of net sales arising from retail sales of certain licensed goods in the first through fifth contract years (and 3.5% thereafter), and (ii) 8% of net sales arising from wholesale sales of such goods. The Company prepaid the Joint Venture’s first year guaranteed minimum royalty of $60.0 million with a portion of the transaction proceeds and recorded as a prepaid royalty on the Consolidated Balance Sheets.

Pursuant to the agreement governing the operations of the Joint Venture (the “Operating Agreement”), cash earnings of the Joint Venture will be distributed quarterly to the Company and WHP on a pro rata basis based on their respective equity ownership interests.

As the Chairman and Chief Executive Officer of WHP was appointed to the Company’s board of directors upon the closing of the stock purchase discussed above, the agreements entered into in connection with the WHP partnership transaction, including the Operating Agreement, the Investment Agreement and the License Agreement (including related royalty payments) are considered related party transactions.

During the thirteen weeks ended April 29, 2023, the Company recognized $4.4 million of royalty income from the Joint Venture, which is recorded in royalty income in the unaudited Consolidated Statements of Income and Comprehensive Income.

Summary Financial Information for Equity Method Investment

Summarized financial information related to the Company's equity method investment in the aggregate on a one-month lag is reflected below:

	Thirteen Weeks Ended April 29, 20231
	(in thousands)
Revenue	$	11,881
Gross profit	11,881
Operating expenses	4,912
Income before taxes	6,969
Net income	$	6,693
Income attributable to the equity method investment	$	(4,440)

1.Reflects a one-month lag

	April 29, 20231
	(in thousands)
Current assets	$	9,637
Non-current assets	416,905
Total assets	$	426,542
Current liabilities	48,449
Non-current liabilities	—
Total liabilities	$	48,449
Equity method investment	$	166,210

1.Reflects a one-month lag

XML

Income Taxes

3 Months Ended

Apr. 29, 2023

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 6 | INCOME TAXES

The provision for income taxes is based on a current estimate of the annual effective tax rate, adjusted to reflect the effect of discrete items. The Company’s effective income tax rate may fluctuate from quarter to quarter as a result of a variety of factors, including the estimate of annual pre-tax income, the related changes in the estimate, and the effect of discrete items. The impact of these items on the effective tax rate will be greater at lower pre-tax levels.

The Company evaluates whether deferred tax assets are realizable on a quarterly basis. The Company considers all available positive and negative evidence, including past operating results and expectations of future operating income. Accordingly, the Company maintains a valuation allowance against the amount of deferred tax assets not expected to be realized as of April 29, 2023.

The Company’s effective tax rate was (0.5)% and 3.9% for the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively. The effective tax rate for the thirteen weeks ended April 29, 2023 and April 30, 2022 reflect the impact of non-deductible executive compensation and the recording of an additional valuation allowance against the Company's current year losses.

The Company's unaudited Consolidated Balance Sheets as of April 29, 2023 and January 28, 2023 reflect $52.3 million of income tax receivable. The Company reclassified the receivable from current to non-current income tax receivable as of April 30, 2022 based on information received from the Internal Revenue Service during the thirteen weeks ended April 30, 2022 that indicated the receivable will not be collected in the next twelve months.

XML

Leases

3 Months Ended

Apr. 29, 2023

Leases [Abstract]

Leases

NOTE 7 | LEASES

The Company leases all of its store locations and its corporate headquarters, which also includes its distribution center, under operating leases. The store leases typically have initial terms of 5 to 10 years; however, most of the leases that are coming to the end of their lease lives are being renegotiated with shorter terms. The current lease term for the corporate headquarters expires in 2026, with one optional five-year extension period. The Company also leases certain equipment and other assets under operating leases, typically with initial terms of 3 to 5 years. The lease term includes the initial contractual term as well as any options to extend the lease when it is reasonably certain that the Company will exercise that option. Leases with an initial term of 12 months or less (short-term leases) are not recorded on the balance sheet. The Company does not currently have any material short-term leases. The Company is generally obligated for the cost of property taxes, insurance and other landlord costs, including common area maintenance charges, relating to its leases. If these charges are fixed, they are combined with lease payments in determining the lease liability; however, if such charges are not fixed, they are considered variable lease costs and are expensed as incurred. The variable payments are not included in the measurement of the lease liability or asset. The Company’s finance leases are immaterial.

Certain lease agreements include rental payments based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company’s lease agreements do not provide an implicit rate, so the Company uses an estimated incremental borrowing rate, which is derived from third-party information available at the lease commencement date, in determining the present value of lease payments. The rate used is for a secured borrowing of a similar term as the lease.

Supplemental cash flow information related to leases is as follows:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	57,648	$	64,832
Right of use assets obtained in exchange for operating lease liabilities	$	60,546	$	17,122

XML

Debt

3 Months Ended

Apr. 29, 2023

Debt Disclosure [Abstract]

Debt

NOTE 8 | DEBT

The following table summarizes the Company's outstanding debt as of the dates indicated:

	April 29, 2023		January 28, 2023
	(in thousands)
Revolving Credit Facility	$	179,750	$	122,000
Less: unamortized debt issuance costs	—		—
Total long-term debt, net	$	179,750	$	122,000
Outstanding letters of credit	$	19,636	$	19,636

Revolving Credit Facility

Express Holding (the "Borrower") and its subsidiaries are party to an Asset-Based Loan Credit Agreement entered into with the lenders party thereto, Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent and collateral agent, and Bank of America, N.A. (“Bank of America”), as documentation agent (the “ABL Credit Agreement”) pursuant to which revolving loans, up to a maximum borrowing amount of $290.0 million (the “Revolving Credit Facility”), may be borrowed, repaid and reborrowed until the maturity date of November 26, 2027, at which time all amounts borrowed must be repaid. Amounts borrowed under the Revolving Credit Facility bear interest at a variable rate indexed to SOFR (as defined in the ABL Credit Agreement) plus a pricing margin ranging from 1.75% to 2.25% per annum, as determined in accordance with the provisions of the ABL Credit Agreement based on average daily excess availability, as of any date of determination, for the most recently ended fiscal quarter, commencing April 30, 2023.

Amounts borrowed under the Revolving Credit Facility are subject to a borrowing base which is calculated based on specified percentages of eligible inventory, credit card receivables and cash, less certain reserves. Commitment reductions and termination of the Revolving Credit Facility prior to the maturity date is permitted, subject in certain instances to a prepayment fee. As of April 29, 2023, the interest rate on the outstanding borrowings of $179.8 million was approximately 7.1%.

The unused line fee payable under the Revolving Credit Facility is 0.25% per annum regardless of the average daily excess availability, payable in arrears monthly on the first day of each calendar month. The Borrower is also obligated to pay other customary closing fees, arrangement fees, administration fees and letter of credit fees for a credit facility of this size and type.

The ABL Credit Agreement requires the Borrower to maintain minimum excess availability of at least the greater of (i) $25.0 million or (ii) 10% of the sum of the Revolving Credit Facility loan cap. From and after the date on which EBITDA (as defined in the ABL Credit Agreement) has exceeded $50.0 million for two consecutive fiscal quarters (each of which consecutive fiscal quarters shall have commenced after November 2, 2024), at any time the excess availability is less than the greater of (i) $25.0 million or (ii) 10% of the Revolving Credit Facility loan cap, and until the excess availability exceeds such amount for thirty consecutive days, the Borrower is required to maintain a fixed charge coverage ratio (as further described in the ABL Credit Agreement) of at least 1.00:1.00, calculated as of the last day of each fiscal quarter (as further described in the ABL Credit Agreement).

The ABL Credit Agreement includes customary events of default that, include among other things, non-payment defaults, inaccuracy of representations and warranties, covenant defaults, cross-default to material indebtedness, bankruptcy and insolvency defaults, material judgment defaults, ERISA defaults, structural defaults under the loan documents and a change of control default. The occurrence of an event of default could result in the acceleration of the Borrower’s obligations under the Revolving Credit Facility. Under certain circumstances, a default interest rate will apply on any amounts payable under the Revolving Credit Facility during the existence of an event of default at a per annum rate equal to 2.00% above the applicable interest rate for any principal and 2.00% above the rate applicable for base rate loans for any other interest.

All obligations under the Revolving Credit Facility are guaranteed by the Loan Parties (other than the Borrower) and

secured by a first priority lien on substantially all of the Loan Parties’ assets, subject to certain permitted liens.

As of April 29, 2023, the Company had $179.8 million in borrowings outstanding under the Revolving Credit Facility and approximately $90.4 million remained available for borrowing under the Revolving Credit Facility after giving effect to outstanding letters of credit in the amount of $19.6 million and subject to certain borrowing base limitations as further discussed above. The fair value of the outstanding borrowings under the Revolving Credit Facility is estimated using Level 2 inputs and at April 29, 2023 and January 28, 2023 was $162.5 million and $115.0 million, respectively.

Letters of Credit

From time to time, the Company may enter into various trade letters of credit ("trade LCs") in favor of certain vendors to secure merchandise. These trade LCs are issued for a defined period of time, for specific shipments, and generally expire three weeks after the merchandise shipment date. As of April 29, 2023 and January 28, 2023, there were no outstanding trade LCs. Additionally, the Company enters into stand-by letters of credit ("stand-by LCs") on an as-needed basis to secure payment obligations for third party logistic services, merchandise purchases, and other general and administrative expenses. As of April 29, 2023 and January 28, 2023, outstanding stand-by LCs totaled $19.6 million, respectively.

XML

Long-Term Incentive Compensation

3 Months Ended

Apr. 29, 2023

Share-Based Payment Arrangement [Abstract]

Long-Term Incentive Compensation

NOTE 9 | LONG-TERM INCENTIVE COMPENSATION

The Company records the fair value of share-based payments to employees in the unaudited Consolidated Statements of Income and Comprehensive Income as compensation expense, net of forfeitures, over the requisite service period. The Company issues shares of common stock from treasury stock, at average cost, upon exercise of stock options and vesting of restricted stock units, including those with performance conditions.

Long-Term Incentive Compensation

The following summarizes long-term incentive compensation expense:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Restricted stock units	$	762	$	1,193
Stock options	87		87
Performance-based restricted stock units	1,022		1,113
Total share-based compensation	$	1,871	$	2,393
Cash-settled awards	2,653		2,720
Total long-term incentive compensation	$	4,524	$	5,113

The stock compensation related income tax benefit, excluding consideration of valuation allowances, recognized by the Company during the thirteen weeks ended April 29, 2023 and April 30, 2022 was $4.1 million and $2.7 million, respectively.

The valuation allowances associated with these tax benefits were $4.1 million and $2.7 million for the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively.

Equity Awards

Restricted Stock Units

During the thirteen weeks ended April 29, 2023, the Company granted restricted stock units (“RSUs”) under the Express, Inc. 2018 Incentive Compensation Plan (the "Plan"). The fair value of RSUs is generally determined based on the Company’s closing stock price on the day prior to the grant date in accordance with the 2018 Plan. The RSUs granted generally vest ratably over one to three years and the expense related to these RSUs is recognized using the straight-line attribution method over this vesting period.

The Company’s activity with respect to RSUs for the thirteen weeks ended April 29, 2023 was as follows:

	Number of Shares	Grant Date Weighted Average Fair Value Per Share
	(in thousands, except per share amounts)
Unvested - January 28, 2023	1,733	$	2.27
Granted	13	$	1.14
Vested	(1,239)	$	2.11
Forfeited	(45)	$	2.73
Unvested - April 29, 2023	462	$	2.61

The total fair value of RSUs that vested during the thirteen weeks ended April 29, 2023 and April 30, 2022 was $2.6 million and $3.9 million, respectively. As of April 29, 2023, there was approximately $0.3 million of total unrecognized compensation expense related to unvested RSUs, which is expected to be recognized over a remaining weighted-average period of approximately 0.6 years.

Stock Options

The Company’s activity with respect to stock options during the thirteen weeks ended April 29, 2023 was as follows:

	Number of Shares	Grant Date Weighted Average Exercise Price Per Share		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
	(in thousands, except per share amounts and years)
Outstanding - January 28, 2023	2,857	$	4.84
Granted	—	$	—
Exercised	—	$	—
Forfeited or expired	(93)	$	15.84
Outstanding - April 29, 2023	2,764	$	4.48	5.65	$	—
Expected to vest at April 29, 2023	280	$	2.60	6.21	$	—
Exercisable at April 29, 2023	2,484	$	4.69	5.58	$	—

As of April 29, 2023, there was approximately $0.1 million of total unrecognized compensation expense related to stock options, which is expected to be recognized over a remaining weighted average period of approximately 0.2 years.

Performance-Based Restricted Stock Units

During 2022, the Company granted performance-based RSUs to a limited number of senior executive-level employees, which entitle these employees to receive a specified number of shares of the Company’s common stock upon vesting. The number of shares earned could range between 0% and 200% of the target amount depending upon performance achieved over a three-year vesting period. The performance conditions of the award include adjusted earnings before interest, taxes, depreciation, and amortization ("Adjusted EBITDA") targets and total shareholder return ("TSR") of the Company’s common stock relative to a select group of peer companies. A Monte Carlo valuation model was used to determine the fair value of the awards. The TSR performance condition is a market condition. Therefore, the fair value of the portion of the awards which vest based on the TSR performance condition is fixed at the measurement date and is not revised based on actual performance during the three-year vesting period. The number of shares underlying the portion of the awards which vest based on the Company’s Adjusted EBITDA performance in relation to the pre-established targets will change during the three-year vesting period based on estimates. As of April 29, 2023, $4.6 million of total unrecognized compensation cost is expected to be recognized on performance-based restricted stock units over a remaining weighted-average period of 1.4 years.

Cash-Settled Awards

Time-Based Cash-Settled Awards

During the thirteen weeks ended April 29, 2023, the Company granted time-based cash-settled awards to employees that vest ratably over three years. These awards are classified as liabilities and do not vary based on changes in the Company's stock price or financial performance. The expense related to these awards will be accrued using a straight-line method over this vesting period. As of April 29, 2023, $19.9 million of total unrecognized compensation cost is expected to be recognized on cash-settled awards over a remaining weighted-average period of 1.7 years.

Performance-Based Cash-Settled Awards

During the thirteen weeks ended April 29, 2023, the Company granted performance-based cash-settled awards to a limited number of senior executive-level employees. These awards are classified as liabilities, are valued based on the fair value of the award at the grant date and are remeasured at each reporting date until settlement with compensation expense being recognized in proportion to the completed requisite service period up until date of settlement. The amount of cash earned ranges between 0% and 200% of the target amount depending upon performance achieved over a three-year performance period commencing on the first day of the Company’s 2023 fiscal year and ending on the last day of the Company’s 2025 fiscal year. The performance conditions of the award include Adjusted EBITDA targets and TSR of the Company’s common stock relative to a select group of peer companies. The fair value of the awards will change based on estimates of the Company’s Adjusted EBITDA performance in relation to the pre-established targets. A Monte Carlo valuation model is used to determine the fair value of the awards. As of April 29, 2023, $4.9 million of total unrecognized compensation cost is expected to be recognized on performance-based cash-settled awards over a remaining weighted-average period of 3.0 years.

XML

Commitments and Contingencies

3 Months Ended

Apr. 29, 2023

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

NOTE 10 | COMMITMENTS AND CONTINGENCIES

In a complaint filed in January 2017 by Mr. Jorge Chacon in the Superior Court for the State of California for the County of Orange, certain subsidiaries of the Company were named as defendants in a representative action alleging violations of California state wage and hour statutes and other labor standards. The lawsuit seeks unspecified monetary damages and attorneys’ fees.

In July 2018, former associate Ms. Christie Carr filed suit in Alameda County Superior Court for the State of California naming certain subsidiaries of the Company as defendants in a representative action alleging violations of California State wage and hour statutes and other labor standard violations. The lawsuit seeks unspecified monetary damages and attorneys’ fees.

On January 29, 2019, Mr. Jorge Chacon filed a second representative action in the Superior Court for the State of California for the County of Orange alleging violations of California state wage and hour statutes and other labor standard violations, which was removed to federal court by the Company and is now pending in the United States District Court for the Central District of California (the “District Court”). The lawsuit seeks unspecified monetary damages and attorneys' fees. In June 2021, a portion of Mr. Chacon’s claims in this action were certified as a class action. Plaintiff and the Company both filed Motions for Summary Judgment on February 28, 2022.

In June 2022, as a result of a mediation process overseen by an independent mediator, the parties agreed, subject to approval by the District Court, to settle these matters for an amount not material to the Company. The proposed settlement will resolve the Chacon and Carr matters in their entirety and also provide for a broad release of claims asserted therein on behalf of the Company’s current and former employees in California for wage and hour violations.

As of April 29, 2023, the Company's unaudited Consolidated Balance Sheet includes an estimated liability based on its best estimate of the outcome of the unresolved matters.

XML

Stockholders' Equity

3 Months Ended

Apr. 29, 2023

Equity [Abstract]

Stockholders' Equity

NOTE 11 | STOCKHOLDERS' EQUITY

Share Repurchase Program

On November 28, 2017, the Company's Board of Directors ("Board") approved a share repurchase program that authorizes the Company to repurchase up to $150.0 million of the Company’s outstanding common stock using available cash (the "Repurchase Program"). The Company may repurchase shares on the open market, including through Rule 10b5-1 plans, in privately negotiated transactions, through block purchases, or otherwise in compliance with applicable laws, including Rule 10b-18 of the Exchange Act of 1934. The timing and amount of stock repurchases will depend on a variety of factors, including business and market conditions as well as corporate and regulatory considerations. The share repurchase program may be suspended, modified, or discontinued at any time and the Company has no obligation to repurchase any amount of its common stock under the program. During the thirteen weeks ended April 29, 2023 and April 30, 2022, the Company did not repurchase any shares of its common stock. As of April 29, 2023, the Company had approximately $34.2 million remaining under this Board authorization.

XML

Subsequent Events

3 Months Ended

Apr. 29, 2023

Subsequent Events [Abstract]

Subsequent Events

NOTE 12 | SUBSEQUENT EVENTS

Bonobos Asset Acquisition

On May 23, 2023, the Company completed the acquisition of the operating assets of the Bonobos business. Total cash consideration paid by the Company at the closing of the transaction was $28.3 million, which represents (i) the $25.0 million purchase price, plus (ii) certain customary adjustments related to net working capital and prepaid rent expense.

License Agreement

On May 23, 2023, the Company and WHP entered into a license agreement that provides the Company with an exclusive license in the United States to intellectual property related to the Bonobos brand, including intellectual property rights for the Bonobos brand that was separately acquired by WHP (the “Bonobos License Agreement”). The Bonobos License Agreement has an initial term of 10 years from the effective date, and will automatically renew for successive renewal terms of 10 years unless (i) the Company provides notice of non-renewal at least 24 months prior to the end of the initial or applicable renewal term, or (ii) WHP exercises its right to not renew in the event of certain failures by the Company to pay the annual guaranteed minimum royalty. Except for such non-renewal rights, the Bonobos License Agreement will not be terminable by either party. The Company will pay WHP a royalty on net sales of certain licensed goods and will commit to an annual guaranteed minimum royalty during the term of the Bonobos License Agreement (ranging from $6.5 million in the first contract year to $11.5 million in the tenth contract year and each contract year thereafter). The Company will pay royalties at a rate of (i) 3.25% of net sales arising from retail sales of certain licensed goods in the first through the fifth contract years (and 3.5% thereafter), and (ii) 8% of net sales arising from wholesale sales of such goods.

XML

Description of Business and Basis of Presentation (Policies)

3 Months Ended

Apr. 29, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Fiscal Year

Fiscal Year

The Company's fiscal year ends on the Saturday closest to January 31. Fiscal years are designated in the unaudited Consolidated Financial Statements and Notes, as well as the remainder of this Quarterly Report, by the calendar year in which the fiscal year commences. All references herein to the Company's fiscal years are as follows:

Fiscal Year	Year Ended	Number of Weeks
2023	February 3, 2024	53
2022	January 28, 2023	52

All references herein to “the first quarter of 2023” and “the first quarter of 2022” represent the thirteen weeks ended April 29, 2023 and April 30, 2022, respectively.

Basis of Presentation

Basis of Presentation

The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and the U.S. Securities and Exchange Commission’s Article 10, Regulation S-X and therefore do not include all of the information or footnotes required for complete financial statements. In the opinion of management, the accompanying unaudited Consolidated Financial Statements reflect all adjustments (which are of a normal recurring nature) necessary to state fairly the financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results of operations to be anticipated for the Company's future interim periods or 2023 fiscal year. Therefore, these statements should be read in conjunction with the

Consolidated Financial Statements and Notes thereto for the year ended January 28, 2023, included in the Annual Report.

Express, Inc., through its indirect, wholly owned subsidiaries, including Express Fashion Operations, LLC, conducts the operations of the Company and Express Fashion Investments, LLC which owns a 40% economic interest with significant influence in the Joint Venture.

Principles of Consolidation

Principles of Consolidation

The unaudited Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. The Company indirectly holds a 40% equity method interest in the Joint Venture, which is majority owned by WH Borrower, LLC, an affiliate of WHP. All intercompany transactions and balances have been eliminated in consolidation.

Segment Reporting

Segment Reporting    

The Company defines an operating segment on the same basis that it uses to evaluate performance internally. The Company has determined that its Chief Executive Officer is the Chief Operating Decision Maker, and that there is one operating segment. Therefore, the Company reports results as a single segment, which includes the operation of its Express and UpWest brick-and-mortar retail and outlet stores and eCommerce operations.

Use of Estimates in the Preparation of Financial Statements and Going Concern and Management’s Plans

Use of Estimates in the Preparation of Financial Statements

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenue and expense during the reporting period, as well as the related disclosure of contingent assets and liabilities as of the date of the unaudited Consolidated Financial Statements. Actual results may differ from those estimates. The Company revises its estimates and assumptions as new information becomes available.

Going Concern and Management’s Plans

The Company’s revenues, results of operations and cash flows have been materially adversely impacted by negative macroeconomic factors beginning in the third and fourth quarters of 2022 and continuing into the first quarter of 2023. The persistently challenging macroeconomic and retail apparel environments, including reduced consumer spending and increased price sensitivity in discretionary categories, has significantly impacted the Company's performance. Net sales during the first quarter of 2023 decreased approximately $67.5 million compared to the first quarter of 2022 and this decline, coupled with an increase in promotional activity, drove gross margin and operating loss below the Company's expectations. For the first quarter of 2023, the Company reported a net operating loss of $70.1 million and negative operating cash flows of $80.6 million.

As of April 29, 2023, the Company was in compliance with the covenants under the agreements governing its indebtedness, however, due to the uncertainty in the Company’s business, the Company could experience material further decreases to revenues and cash flows and may experience difficulty remaining in compliance with such covenants. Refer to Note 8 for further details regarding the terms of the ABL Credit Agreement and the Revolving Credit Facility provided to the Company thereunder.

When conditions and events, in the aggregate, impact an entity's ability to continue as a going concern, management evaluates the mitigating effect of its plans to determine if it is probable that the plans will be effectively implemented and, when implemented, the plans will mitigate the relevant conditions or events.

The Company's plans are focused on improving its results and liquidity through additional expense savings and improved sales trends as we move through the balance of fiscal year 2023. The Company is committed to finding significant additional expense savings which are expected to benefit the second half of fiscal 2023 and full fiscal year 2024, and has engaged external advisors to assist in analyzing and identifying both potential margin expansion and further expense saving opportunities. Additionally, the Company has contingency plans which would further reduce or defer additional expenses and cash outlays should operations weaken beyond current forecasts. The Company believes these plans are probable of being successfully implemented, which will result in adequate cash flows to support its ongoing operations and to meet its financial covenant requirements under the agreements governing its indebtedness for at least one year following the date these financial statements are issued.

The accompanying unaudited Consolidated Financial Statements are prepared in accordance with generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business.

Revenue Recognition

Merchandise Sales

The Company recognizes sales for in-store purchases at the point-of-sale. Revenue related to eCommerce transactions is recognized upon shipment based on the fact that control transfers to the customer at that time. The Company has made a policy election to treat shipping and handling as costs to fulfill the contract, and as a result, any amounts received from customers are included in the transaction price allocated to the performance obligation of providing goods with a corresponding amount accrued within cost of goods sold, buying and occupancy costs in the unaudited Consolidated Statements of Income and Comprehensive Income for amounts paid to applicable carriers. Associate discounts on merchandise purchases are classified as a reduction of net sales. Net sales excludes sales tax collected from customers and remitted to governmental authorities.

Loyalty Program

The Company maintains a customer loyalty program in which customers earn points toward rewards for qualifying purchases and other marketing activities. Upon reaching specified point values, customers are issued a reward, which they may redeem on merchandise purchases at the Company’s stores or on its website. Generally, rewards earned must be redeemed within 60 days from the date of issuance. The Company defers a portion of merchandise sales based on the estimated standalone selling price of the points earned. This deferred revenue is recognized as certificates are redeemed or expire. To calculate this deferral, the Company makes assumptions related to loyalty point and certificate redemption rates based on historical experience. The loyalty liability is included in deferred revenue on the unaudited Consolidated Balance Sheets.

Sales Returns Reserve

The Company reduces net sales and provides a reserve for projected merchandise returns based on prior experience. Merchandise returns are often resalable merchandise and are refunded by issuing the same payment tender as the original purchase. The sales returns reserve was $14.9 million and $9.0 million as of April 29, 2023 and January 28, 2023, respectively, and is included in accrued expenses on the unaudited Consolidated Balance Sheets. The asset related to projected returned merchandise is included in other assets on the unaudited Consolidated Balance Sheets.

Gift Cards

The Company sells gift cards in its stores, on its eCommerce website, and through third parties. These gift cards do not expire or lose value over periods of inactivity. The Company accounts for gift cards by recognizing a liability at the time a gift card is sold. The gift card liability balance was $23.7 million and $25.6 million, as of April 29, 2023 and January 28, 2023, respectively, and is included in deferred revenue on the unaudited Consolidated Balance Sheets. During the thirteen weeks ended April 29, 2023 and April 30, 2022, the Company recognized approximately $3.7 million and $4.3 million of revenue that was previously included in the beginning gift card contract liability, respectively. The Company recognizes revenue from gift cards when they are redeemed by the customer. The Company also recognizes income on unredeemed gift cards, referred to as “gift card breakage.” Gift card breakage is recognized proportionately using a time-based attribution method from issuance of the gift card to the time when it can be determined that the likelihood of the gift card being redeemed is remote and that there is no legal obligation to remit unredeemed gift cards to relevant jurisdictions. The gift card breakage rate is based on historical redemption patterns. Gift card breakage is included within the other revenue component of net sales in the unaudited Consolidated Statements of Income and Comprehensive Income.

Private Label Credit Card

The Company has an agreement with Comenity Bank (the “Bank”) to provide customers with private label credit cards (as amended, the “Card Agreement”). The term of the Card Agreement expires on December 31, 2024. Each private label credit card bears the logo of the Express brand and can only be used at the Company’s store locations and eCommerce channel. The Bank is the sole owner of the accounts issued under the private label credit card program and absorbs the losses associated with non-payment by the private label card holders and a portion of any fraudulent usage of the accounts.

Pursuant to the Card Agreement, the Company receives amounts from the Bank during the term based on a percentage of private label credit card sales and is also eligible to receive incentive payments for the achievement of certain performance targets. These funds are recorded within the other revenue component of net sales in the unaudited Consolidated Statements of Income and Comprehensive Income. The Company also receives reimbursement funds from the Bank for certain expenses the Company incurs. These reimbursement funds are

used by the Company to fund marketing and other programs associated with the private label credit card. The reimbursement funds received related to private label credit cards are recorded within the other revenue component of net sales in the Consolidated Statements of Income and Comprehensive Income.

Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Assets and liabilities measured at fair value are classified using the following hierarchy, which is based upon the transparency of inputs to the valuation as of the measurement date.

■Level 1 - Valuation is based upon quoted prices (unadjusted) for identical assets or liabilities in active markets.

■Level 2 - Valuation is based upon quoted prices for similar assets and liabilities in active markets or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

■Level 3 - Valuation is based upon other unobservable inputs that are significant to the fair value measurement.

The money market funds are valued using quoted market prices in active markets.

Non-Financial Assets

The Company's non-financial assets, which include fixtures, equipment, improvements, right of use assets, and an equity method investment, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur indicating the carrying value of these assets may not be recoverable, or annually in the case of indefinite-lived intangibles, an impairment test is required to be performed by the Company.

The carrying amounts reflected on the unaudited Consolidated Balance Sheets for the remaining cash, cash equivalents, receivables, prepaid expenses, and payables as of April 29, 2023 and January 28, 2023 approximated their fair values. The equity method investment is reflected at cost, and is the result of a market participant transaction with WHP whereby the Company received proceeds of $260.0 million and a 40% ownership interest in the Joint Venture in exchange for contributing certain intellectual property to the Joint Venture.

The Company reviews its equity method investment by comparing its fair value to its carrying value. If the carrying value of the investment exceeds its fair value and the loss in value is other than temporary, the investment is considered impaired and reduced to fair value, and the impairment is recognized in the period identified. Factors providing evidence of such a loss include changes in the investee's operations or financial condition, significant continuing losses, significant negative economic conditions or a significant decrease in the market value. Impairment charges are recorded in other expense (income), net in the unaudited Consolidated Statements of Income and Comprehensive Income.

Store Asset Impairment

Property and equipment, including the right of use assets, are not required to be measured at fair value on a recurring basis. However, if certain triggering events occur indicating the carrying value of these assets may not be recoverable, an impairment test is required. These events include, but are not limited to, material adverse changes in projected revenues, present cash flow losses combined with a history of cash flow losses and a forecast that demonstrates significant continuing losses, significant negative economic conditions, a significant decrease in the market value of an asset and store closure or relocation decisions. The reviews are conducted at the store level, the lowest identifiable level of cash flow.

Stores that display an indicator of impairment are subjected to an impairment assessment. Such stores are tested for recoverability by comparing the sum of the estimated future undiscounted cash flows to the carrying amount of the asset. This recoverability test requires management to make assumptions and judgments related, but not limited, to management’s expectations for future cash flows from operating the store.

▪The key assumption used in the undiscounted future store cash flow models is the sales growth rate.

An impairment loss may be recognized when these undiscounted future cash flows are less than the carrying amount of the asset group. In the circumstance of impairment, any loss would be measured as the excess of the

carrying amount of the asset group over its fair value. Fair value of the store-related assets is determined at the individual store level based on the highest and best use of the asset group.

▪The key assumptions used in the fair value analysis may include discounted estimates of future store cash flows from operating the store and/or comparable market rents.

Leases

The lease term includes the initial contractual term as well as any options to extend the lease when it is reasonably certain that the Company will exercise that option. Leases with an initial term of 12 months or less (short-term leases) are not recorded on the balance sheet. The Company does not currently have any material short-term leases. The Company is generally obligated for the cost of property taxes, insurance and other landlord costs, including common area maintenance charges, relating to its leases. If these charges are fixed, they are combined with lease payments in determining the lease liability; however, if such charges are not fixed, they are considered variable lease costs and are expensed as incurred. The variable payments are not included in the measurement of the lease liability or asset. The Company’s finance leases are immaterial.

Certain lease agreements include rental payments based on a percentage of retail sales over contractual levels and others include rental payments adjusted periodically for inflation. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The Company’s lease agreements do not provide an implicit rate, so the Company uses an estimated incremental borrowing rate, which is derived from third-party information available at the lease commencement date, in determining the present value of lease payments. The rate used is for a secured borrowing of a similar term as the lease.

Share-Based Compensation

The Company records the fair value of share-based payments to employees in the unaudited Consolidated Statements of Income and Comprehensive Income as compensation expense, net of forfeitures, over the requisite service period. The Company issues shares of common stock from treasury stock, at average cost, upon exercise of stock options and vesting of restricted stock units, including those with performance conditions.The fair value of RSUs is generally determined based on the Company’s closing stock price on the day prior to the grant date in accordance with the 2018 Plan.

XML

Description of Business and Basis of Presentation (Tables)

3 Months Ended

Apr. 29, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Composition of Operated Stores

As of April 29, 2023, the composition of Express operated stores was as follows:

	Store Count
EXPRESS
Retail stores1	337
Factory Outlet stores	195
Total Retail and Factory Outlet stores	532
UpWest	13
Total stores	545

1.As of April 29, 2023, retail store count includes 10 Express Edit stores

XML

Revenue Recognition (Tables)

3 Months Ended

Apr. 29, 2023

Revenue from Contract with Customer [Abstract]

Revenue by Major Product Categories and Sales Channels

The following is information regarding the Company’s major product categories and sales channels:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Apparel	$	344,000	$	401,286
Accessories and other	26,193		35,478
Other revenue	13,064		14,021
Total net sales	$	383,257	$	450,785

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Retail	$	274,256	$	320,877
Outlet	95,937		115,887
Other revenue	13,064		14,021
Total net sales	$	383,257	$	450,785

Contract with Customer, Liability

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning balance loyalty deferred revenue	$	9,939	$	10,918
Net revenue recognized	(540)		(1,562)
Ending balance loyalty deferred revenue	$	9,399	$	9,356

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning gift card liability	$	25,604	$	25,066
Issuances	4,983		6,083
Redemptions	(6,100)		(7,006)
Gift card breakage	(831)		(855)
Ending gift card liability	$	23,656	$	23,288

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Beginning balance refundable payment liability	$	5,516	$	8,394
Recognized in revenue	(719)		(719)
Ending balance refundable payment liability	$	4,797	$	7,675

XML

Earnings Per Share (Tables)

3 Months Ended

Apr. 29, 2023

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table provides a reconciliation between basic and diluted weighted-average shares used to calculate basic and diluted earnings per share:

	Thirteen Weeks Ended
	April 29, 2023	April 30, 2022
	(in thousands)
Weighted-average shares - basic	73,878	67,211
Dilutive effect of stock options and restricted stock units	—	—
Weighted-average shares - diluted	73,878	67,211

XML

Fair Value Measurements (Tables)

3 Months Ended

Apr. 29, 2023

Fair Value Disclosures [Abstract]

Fair Value, Assets Measured on Recurring Basis

The following table presents the Company's financial assets, recorded in cash and cash equivalents on the unaudited Consolidated Balance Sheets, measured at fair value on a recurring basis as of April 29, 2023 and January 28, 2023, aggregated by the level in the fair value hierarchy.

	April 29, 2023
	Level 1		Level 2		Level 3
	(in thousands)
Money market funds	$	—	$	—	$	—
	January 28, 2023
	Level 1		Level 2		Level 3
	(in thousands)
Money market funds	$	47,792	$	—	$	—

XML

Equity Method Investment (Tables)

3 Months Ended

Apr. 29, 2023

Equity Method Investments and Joint Ventures [Abstract]

Schedule of Equity Method Investments

The following table is a summary of the Company’s equity method investment with WHP:

	% of Ownership	Balance Sheet Location	April 29, 2023
			(in thousands)
EXP Topco, LLC.	40%	Equity Method Investment	$	166,210

Summarized financial information related to the Company's equity method investment in the aggregate on a one-month lag is reflected below:

	Thirteen Weeks Ended April 29, 20231
	(in thousands)
Revenue	$	11,881
Gross profit	11,881
Operating expenses	4,912
Income before taxes	6,969
Net income	$	6,693
Income attributable to the equity method investment	$	(4,440)

1.Reflects a one-month lag

	April 29, 20231
	(in thousands)
Current assets	$	9,637
Non-current assets	416,905
Total assets	$	426,542
Current liabilities	48,449
Non-current liabilities	—
Total liabilities	$	48,449
Equity method investment	$	166,210

1.Reflects a one-month lag

XML

Leases (Tables)

3 Months Ended

Apr. 29, 2023

Leases [Abstract]

Supplemental Cash Flow Information on Leases

Supplemental cash flow information related to leases is as follows:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$	57,648	$	64,832
Right of use assets obtained in exchange for operating lease liabilities	$	60,546	$	17,122

XML

Debt (Tables)

3 Months Ended

Apr. 29, 2023

Debt Disclosure [Abstract]

Schedule of Outstanding Debt

The following table summarizes the Company's outstanding debt as of the dates indicated:

	April 29, 2023		January 28, 2023
	(in thousands)
Revolving Credit Facility	$	179,750	$	122,000
Less: unamortized debt issuance costs	—		—
Total long-term debt, net	$	179,750	$	122,000
Outstanding letters of credit	$	19,636	$	19,636

XML

Long-Term Incentive Compensation (Tables)

3 Months Ended

Apr. 29, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Shared-based Compensation Expense

The following summarizes long-term incentive compensation expense:

	Thirteen Weeks Ended
	April 29, 2023		April 30, 2022
	(in thousands)
Restricted stock units	$	762	$	1,193
Stock options	87		87
Performance-based restricted stock units	1,022		1,113
Total share-based compensation	$	1,871	$	2,393
Cash-settled awards	2,653		2,720
Total long-term incentive compensation	$	4,524	$	5,113

Schedule of Activity Related to Restricted Stock Units,

The Company’s activity with respect to RSUs for the thirteen weeks ended April 29, 2023 was as follows:

	Number of Shares	Grant Date Weighted Average Fair Value Per Share
	(in thousands, except per share amounts)
Unvested - January 28, 2023	1,733	$	2.27
Granted	13	$	1.14
Vested	(1,239)	$	2.11
Forfeited	(45)	$	2.73
Unvested - April 29, 2023	462	$	2.61

Schedule of Activity Related to Stock Options

The Company’s activity with respect to stock options during the thirteen weeks ended April 29, 2023 was as follows:

	Number of Shares	Grant Date Weighted Average Exercise Price Per Share		Weighted-Average Remaining Contractual Life (in years)	Aggregate Intrinsic Value
	(in thousands, except per share amounts and years)
Outstanding - January 28, 2023	2,857	$	4.84
Granted	—	$	—
Exercised	—	$	—
Forfeited or expired	(93)	$	15.84
Outstanding - April 29, 2023	2,764	$	4.48	5.65	$	—
Expected to vest at April 29, 2023	280	$	2.60	6.21	$	—
Exercisable at April 29, 2023	2,484	$	4.69	5.58	$	—

XML

Description of Business and Basis of Presentation - Narrative (Details) $ in Thousands	3 Months Ended
	Apr. 29, 2023 USD ($) segment store	Apr. 30, 2022 USD ($)	Jan. 28, 2023	Jan. 25, 2023
Description of Business and Basis of Presentation [Line Items]
Number of stores | store	545
Number of operating segments | segment	1
Decrease in sales from comparable quarter in prior year	$ 67,500
Operating loss	70,115	$ 9,103
Negative operating cash flows	$ 80,612	$ 75,879
EXP Topco LLC
Description of Business and Basis of Presentation [Line Items]
Equity method investment, ownership percentage	40.00%		40.00%	40.00%

XML

Description of Business and Basis of Presentation - Composition of Operated Stores (Details)	Apr. 29, 2023 store
Description of Business and Basis of Presentation [Line Items]
Number of stores	545
Total Retail and Factory Outlet stores
Description of Business and Basis of Presentation [Line Items]
Number of stores	532
Retail stores
Description of Business and Basis of Presentation [Line Items]
Number of stores	337
Retail, Express Edit Brand
Description of Business and Basis of Presentation [Line Items]
Number of stores	10
Factory Outlet stores
Description of Business and Basis of Presentation [Line Items]
Number of stores	195
UpWest
Description of Business and Basis of Presentation [Line Items]
Number of stores	13

XML

Revenue Recognition - Revenue by Major Product Categories and Sales Channels (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Disaggregation of Revenue [Line Items]
Total net sales	$ 383,257	$ 450,785
Apparel
Disaggregation of Revenue [Line Items]
Total net sales	344,000	401,286
Accessories and other
Disaggregation of Revenue [Line Items]
Total net sales	26,193	35,478
Retail
Disaggregation of Revenue [Line Items]
Total net sales	274,256	320,877
Outlet
Disaggregation of Revenue [Line Items]
Total net sales	95,937	115,887
Other revenue
Disaggregation of Revenue [Line Items]
Total net sales	$ 13,064	$ 14,021

XML

Revenue Recognition - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022	Jan. 28, 2023	Jan. 29, 2022	Jan. 31, 2018
Disaggregation of Revenue [Line Items]
Redemption period for rewards earned	60 days
Sales returns reserve	$ 14,900		$ 9,000
Gift card liability	33,243		35,543
Gift Card Liability
Disaggregation of Revenue [Line Items]
Gift card liability	23,656	$ 23,288	25,604	$ 25,066
Net revenue recognized	3,700	4,300
Comenity Bank
Disaggregation of Revenue [Line Items]
Net revenue recognized	719	719
Deferred revenue	4,797	$ 7,675	$ 5,516	$ 8,394
Comenity Bank | Credit Card
Disaggregation of Revenue [Line Items]
Deferred revenue	$ 4,800				$ 20,000

XML

Revenue Recognition - Loyalty Deferred Revenue (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Contract With Customer, Liability [Roll Forward]
Beginning balance	$ 35,543
Ending balance	33,243
Loyalty Program
Contract With Customer, Liability [Roll Forward]
Beginning balance	9,939	$ 10,918
Net revenue recognized	(540)	(1,562)
Ending balance	$ 9,399	$ 9,356

XML

Revenue Recognition - Gift Card Liability (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Contract With Customer, Liability [Roll Forward]
Beginning balance	$ 35,543
Ending balance	33,243
Gift Card Liability
Contract With Customer, Liability [Roll Forward]
Beginning balance	25,604	$ 25,066
Ending balance	23,656	23,288
Issuances
Contract With Customer, Liability [Roll Forward]
Increase (decrease) in gift card liability	4,983	6,083
Redemptions
Contract With Customer, Liability [Roll Forward]
Increase (decrease) in gift card liability	(6,100)	(7,006)
Gift card breakage
Contract With Customer, Liability [Roll Forward]
Increase (decrease) in gift card liability	$ (831)	$ (855)

XML

Revenue Recognition - Refundable Payment Liability (Details) - Comenity Bank - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Contract With Customer, Liability [Roll Forward]
Beginning balance refundable payment liability	$ 5,516	$ 8,394
Recognized in revenue	(719)	(719)
Ending balance refundable payment liability	$ 4,797	$ 7,675

XML

Earnings Per Share- Basic and Diluted Earnings per Share (Details) - shares shares in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Earnings Per Share [Abstract]
Weighted-average shares - basic (in shares)	73,878	67,211
Dilutive effect of stock options and restricted stock units (in shares)	0	0
Weighted-average shares - diluted (in shares)	73,878	67,211

XML

Earnings Per Share - Narrative (Details) - shares shares in Millions	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of earnings per share (in shares)	4.3	6.8
Performance Shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Potentially dilutive securities excluded from computation of earnings per share (in shares)	2.9

XML

Fair Value Measurements - Fair Value of Assets Measured on Recurring Basis (Details) - Money market funds - USD ($) $ in Thousands	Apr. 29, 2023	Jan. 28, 2023
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial assets	$ 0	$ 47,792
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial assets	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Financial assets	$ 0	$ 0

XML

Fair Value Measurements - Narrative (Details) - USD ($)	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022	Jan. 28, 2023	Jan. 25, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Proceeds received from contributing intellectual property to joint venture	$ 260,000,000
Impairment charges	$ 0	$ 0
EXP Topco LLC
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity method investment, ownership percentage	40.00%		40.00%	40.00%

XML

Equity Method Investment - Schedule of Equity Method Investment (Details) - USD ($) $ in Thousands	Apr. 29, 2023	Jan. 28, 2023	Jan. 25, 2023
Schedule of Equity Method Investments [Line Items]
Equity Method Investment	$ 166,210	$ 166,106
EXP Topco LLC
Schedule of Equity Method Investments [Line Items]
Equity method investment, ownership percentage	40.00%	40.00%	40.00%
Equity Method Investment	$ 166,210	$ 156,700	$ 156,700

XML

Equity Method Investment - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions		3 Months Ended
	Jan. 25, 2023	Apr. 29, 2023	Jan. 28, 2023	Apr. 30, 2022
Schedule of Equity Method Investments [Line Items]
Equity method investments, lag on reporting, period		1 month
Equity method investment		$ 166,210,000	$ 166,106,000
License agreement, term	10 years
License agreement, renewal term	10 years
License agreement, minimum notice period for nonrenewal	24 months
License agreement, annual guaranteed minimum royalty in first year	$ 60,000,000
License agreement, annual guaranteed minimum royalty increase per year after first year and thru fifth year	$ 1,000,000
License agreement, annual guaranteed minimum royalty increase per year, period	5 years
License agreement, annual guaranteed minimum royalty at sixth year and thereafter	$ 65,000,000
License agreement, royalty percentage on net sales from retail of certain licensed goods thru fifth year	3.25%
License agreement, royalty percentage on net sales from retail of certain licensed goods, thereafter fifth year	3.50%
License agreement, royalty percentage on net sales from wholesale of certain licensed goods	8.00%
Prepaid royalties, initially recorded	$ 60,000,000
Royalty income		$ 4,440,000		$ 0
WHP | Private Placement
Schedule of Equity Method Investments [Line Items]
Shares sold in offering (in shares)	5.4
Purchase price (in USD per share)	$ 4.60
Sale of stock, pro forma ownership percentage	7.40%
Gain on sale of stock	$ 17,800,000
EXP Topco LLC
Schedule of Equity Method Investments [Line Items]
Equity method investment, ownership percentage	40.00%	40.00%	40.00%
Ownership interest by third party	60.00%
Equity method investment	$ 156,700,000	$ 166,210,000	$ 156,700,000
Equity method investment, transaction costs			9,400,000
EXP Topco LLC | Intellectual Property
Schedule of Equity Method Investments [Line Items]
Finite-lived intangible assets, net			0
Gain on contribution of intangible assets			$ 391,700,000
EXP Topco LLC | WHP
Schedule of Equity Method Investments [Line Items]
Payments to acquire interest in joint venture	$ 235,000,000

XML

Equity Method Investment - Summarized Income Statement Impact from Equity Method Investments (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Schedule of Equity Method Investments [Line Items]
Equity method investments, lag on reporting, period	1 month
Total net sales	$ 383,257	$ 450,785
GROSS PROFIT	63,793	131,500
Operating expenses	133,908	140,603
LOSS BEFORE INCOME TAXES	(73,058)	(12,397)
Net income	(73,427)	$ (11,914)
Income attributable to the equity method investment	(4,440)
Equity Method Investment, Nonconsolidated Investee or Group of Investees
Schedule of Equity Method Investments [Line Items]
Total net sales	11,881
GROSS PROFIT	11,881
Operating expenses	4,912
LOSS BEFORE INCOME TAXES	6,969
Net income	$ 6,693

XML

Equity Method Investment - Summarized Balance Sheet Impact from Equity Method Investments (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Jan. 28, 2023
Schedule of Equity Method Investments [Line Items]
Current assets	$ 477,837	$ 534,404
TOTAL ASSETS	1,353,701	1,398,325
Current liabilities	510,211	541,590
Total Liabilities	1,118,042	1,090,756
Equity method investment	$ 166,210	$ 166,106
Equity method investments, lag on reporting, period	1 month
Equity Method Investment, Nonconsolidated Investee or Group of Investees
Schedule of Equity Method Investments [Line Items]
Current assets	$ 9,637
Non-current assets	416,905
TOTAL ASSETS	426,542
Current liabilities	48,449
Non-current liabilities	0
Total Liabilities	$ 48,449

XML

Income Taxes (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022	Jan. 28, 2023
Income Tax Disclosure [Abstract]
Effective income tax rate	(0.50%)	3.90%
Income taxes receivable, CARES Act	$ 52.3		$ 52.3

XML

Leases - Narrative (Details)	3 Months Ended
	Apr. 29, 2023 renewal_option
Office Building
Lessee, Lease, Description [Line Items]
Number of renewal options	1
Lease renewal term	5 years
Minimum | Stores
Lessee, Lease, Description [Line Items]
Lease term	5 years
Minimum | Equipment and Other Assets
Lessee, Lease, Description [Line Items]
Lease term	3 years
Maximum | Stores
Lessee, Lease, Description [Line Items]
Lease term	10 years
Maximum | Equipment and Other Assets
Lessee, Lease, Description [Line Items]
Lease term	5 years

XML

Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows for operating leases	$ 57,648	$ 64,832
Right of use assets obtained in exchange for operating lease liabilities	$ 60,546	$ 17,122

XML

Debt - Outstanding Debt (Details) - USD ($) $ in Thousands	Apr. 29, 2023	Jan. 28, 2023
Debt Instrument [Line Items]
Less: unamortized debt issuance costs	$ 0	$ 0
Total long-term debt, net	179,750	122,000
Line of Credit
Debt Instrument [Line Items]
Outstanding letters of credit	19,636	19,636
Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Total outstanding borrowings	$ 179,750	$ 122,000

XML

Debt - Narrative (Details) - Line of Credit		3 Months Ended
	Nov. 23, 2022 USD ($)	Apr. 29, 2023 USD ($)	Jan. 28, 2023 USD ($)
Debt Instrument [Line Items]
Outstanding letters of credit		$ 19,636,000	$ 19,636,000
Asset-Based Loan Credit Agreement | Revolving Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 290,000,000
Line of credit, borrowings outstanding		179,800,000
Unused line fee payable	0.25%
Debt, covenant, minimum excess availability, amount	$ 25,000,000
Debt, covenant, minimum excess availability, percentage	10.00%
Debt instrument, covenant, EBITDA threshold, two consecutive quarters	$ 50,000,000
Debt instrument, remaining borrowing capacity, consecutive trading days	30 days
Debt instrument, covenant, minimum fixed charge coverage ratio	1.00
Debt default, principal, additional interest rate	2.00%
Debt default, base rate loans, additional interest rate	2.00%
Line of credit, remaining borrowing capacity		90,400,000
Debt, fair value		162,500,000	115,000,000
Asset-Based Loan Credit Agreement | Letter of Credit
Debt Instrument [Line Items]
Outstanding letters of credit		19,600,000	$ 19,600,000
Asset-Based Loan Credit Agreement | Trade Letter Of Credit
Debt Instrument [Line Items]
Outstanding letters of credit		$ 0
Expiration term for trade letters of credit		21 days
Secured Overnight Financing Rate (SOFR) | Asset-Based Loan Credit Agreement | Revolving Credit Facility
Debt Instrument [Line Items]
Effective interest rate		7.10%
Secured Overnight Financing Rate (SOFR) | Asset-Based Loan Credit Agreement | Revolving Credit Facility | Minimum
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	1.75%
Secured Overnight Financing Rate (SOFR) | Asset-Based Loan Credit Agreement | Revolving Credit Facility | Maximum
Debt Instrument [Line Items]
Debt instrument, basis spread on variable rate	2.25%

XML

Long-Term Incentive Compensation - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Apr. 29, 2023	Apr. 30, 2022	Jan. 28, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Tax benefit from share-based compensation expense	$ 4.1	$ 2.7
Tax benefit from share-based compensation expense, valuation allowance	4.1	2.7
Unrecognized compensation expense related to stock options	0.1
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of options vested	2.6	$ 3.9
Unrecognized compensation costs, excluding stock options	$ 0.3
Unrecognized compensation costs, period for recognition	7 months 6 days
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation costs, period for recognition	2 months 12 days
Performance-based restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			3 years
Unrecognized compensation costs, excluding stock options	$ 4.6
Unrecognized compensation costs, period for recognition	1 year 4 months 24 days
Time-Based Cash-Settled Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Unrecognized compensation costs, excluding stock options	$ 19.9
Unrecognized compensation costs, period for recognition	1 year 8 months 12 days
Performance-Based Cash-Settled Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation costs, excluding stock options	$ 4.9
Unrecognized compensation costs, period for recognition	3 years
Award performance period	3 years
Minimum | Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	1 year
Minimum | Performance-based restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Target percentage of performance award which can be earned			0.00%
Minimum | Performance-Based Cash-Settled Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Target percentage of performance award which can be earned	0.00%
Maximum | Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Maximum | Performance-based restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Target percentage of performance award which can be earned			200.00%
Maximum | Performance-Based Cash-Settled Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Target percentage of performance award which can be earned	200.00%

XML

Long-Term Incentive Compensation - Shared-based Compensation Expense (Details) - USD ($) $ in Thousands	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	$ 1,871	$ 2,393
Long-term incentive compensation	4,524	5,113
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	762	1,193
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	87	87
Performance-based restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation	1,022	1,113
Cash-settled awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Long-term incentive compensation	$ 2,653	$ 2,720

XML

Long-Term Incentive Compensation - Restricted Stock Units, Including Awards with Performance Conditions (Details) - Restricted stock units shares in Thousands	3 Months Ended
	Apr. 29, 2023 $ / shares shares
Number of Shares
Unvested at beginning of period (in shares) | shares	1,733
Granted (in shares) | shares	13
Vested (in shares) | shares	(1,239)
Forfeited (in shares) | shares	(45)
Unvested at end of period (in shares) | shares	462
Grant Date Weighted Average Fair Value Per Share
Unvested at beginning of period (in USD per share) | $ / shares	$ 2.27
Granted (in USD per share) | $ / shares	1.14
Vested (in USD per share) | $ / shares	2.11
Forfeited (in USD per share) | $ / shares	2.73
Unvested at end of period (in USD per share) | $ / shares	$ 2.61

XML

Long-Term Incentive Compensation - Stock Options Activity (Details) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Apr. 29, 2023 USD ($) $ / shares shares
Number of Shares
Outstanding at beginning of period (in shares) | shares	2,857
Granted (in shares) | shares	0
Exercised (in shares) | shares	0
Forfeited or expired (in shares) | shares	(93)
Outstanding at end of period (in shares) | shares	2,764
Expected to vest at end of period (in shares) | shares	280
Exercisable at end of period (in shares) | shares	2,484
Grant Date Weighted Average Exercise Price Per Share
Outstanding at beginning of period (in USD per share) | $ / shares	$ 4.84
Granted (in USD per share) | $ / shares	0
Exercised (in USD per share) | $ / shares	0
Forfeited or expired (in USD per share) | $ / shares	15.84
Outstanding at end of period (in USD per share) | $ / shares	4.48
Expected to vest at end of period (in USD per share) | $ / shares	2.60
Exercisable at end of period (in USD per share) | $ / shares	$ 4.69
Weighted-Average Remaining Contractual Life (in years)
Outstanding at end of period	5 years 7 months 24 days
Expected to vest at end of period	6 years 2 months 15 days
Exercisable at end of period	5 years 6 months 29 days
Aggregate Intrinsic Value
Outstanding at end of period | $	$ 0
Expected to vest at end of period | $	0
Exercisable at end of period | $	$ 0

XML

Stockholders' Equity (Details) - USD ($) $ in Millions	3 Months Ended
	Apr. 29, 2023	Apr. 30, 2022	Nov. 28, 2017
Equity [Abstract]
Stock repurchase program, authorized amount			$ 150.0
Repurchase of common stock (in shares)	0	0
Stock repurchase program, remaining authorized amount	$ 34.2

XML

Subsequent Events (Details) - USD ($) $ in Millions	May 23, 2023	Jan. 25, 2023
Subsequent Event [Line Items]
License agreement, term		10 years
License agreement, renewal term		10 years
License agreement, minimum notice period for nonrenewal		24 months
License agreement, annual guaranteed minimum royalty in first year		$ 60.0
License agreement, royalty percentage on net sales from retail of certain licensed goods thru fifth year		3.25%
License agreement, royalty percentage on net sales from retail of certain licensed goods, thereafter fifth year		3.50%
License agreement, royalty percentage on net sales from wholesale of certain licensed goods		8.00%
Subsequent Event
Subsequent Event [Line Items]
License agreement, term	10 years
License agreement, renewal term	10 years
License agreement, minimum notice period for nonrenewal	24 months
License agreement, annual guaranteed minimum royalty in first year	$ 6.5
License agreement, annual guaranteed minimum royalty at tenth year and thereafter	$ 11.5
License agreement, royalty percentage on net sales from retail of certain licensed goods thru fifth year	3.25%
License agreement, royalty percentage on net sales from retail of certain licensed goods, thereafter fifth year	3.50%
License agreement, royalty percentage on net sales from wholesale of certain licensed goods	8.00%
Subsequent Event | Bonobos
Subsequent Event [Line Items]
Business purchase price	$ 25.0
Consideration transferred	$ 28.3