Discontinued Operations

9 Months Ended

Nov. 01, 2025

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

Discontinued Operations

On March 11, 2025, the Company completed the sale of Creative Genius pursuant to an Interest Purchase Agreement (the “Agreement”) to sell one hundred percent (100%) of Creative Genius, which operates under the name Pura Vida Bracelets. The sale consummated on March 31, 2025. In connection with the transaction, the Company received total consideration of $3.5 million, consisting of a combination of cash consideration, subject to net working capital and net cash adjustments as well as contingent consideration.

At closing, the Company received cash proceeds of $0.9 million. Cash proceeds totaled $1.0 million for the thirty-nine weeks ended November 1, 2025. In addition, the Company is entitled to receive contingent consideration with an estimated fair value of $2.5 million, based on the present value of expected future payments. The contingent consideration is calculated as 5% of total sales generated by the divested business, as operated by the buyer, net of customary shipping costs, during the earn-out period specified in the agreement. The earn-out period and related terms are consistent with customary provisions for transactions of this nature. The fair value of the contingent consideration was determined using a probability-weighted discounted cash flow analysis based on internal projections of the buyer’s expected future sales. The fair value measurement is classified as Level 3 within the fair value hierarchy due to the use of unobservable inputs.

The Company will assess changes in the fair value of the contingent consideration at each reporting date, with any adjustments recognized in earnings in the period in which such changes are identified.

The Company recorded a net loss on disposal of $15.2 million for the thirty-nine weeks ended November 1, 2025. The loss on sale is presented as part of results of the discontinued operations.

The results of operations for the Pura Vida business is reported as discontinued operations in the Consolidated Statements of Operations for all periods presented in this Form 10-Q. This business was historically presented as its own reportable segment.

Results of discontinued operations were as follows for the thirteen and thirty-nine weeks ended November 1, 2025 and November 2, 2024:

	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	November 1, 2025		November 2, 2024		November 1, 2025		November 2, 2024
Net revenues	$	—	$	10,095	$	5,553	$	39,569
Cost of sales	—		4,904		2,167		16,856
Gross profit	—		5,191		3,386		22,713
Selling, general, and administrative expenses	—		7,517		3,244		25,381
Other income (expense), net (1)	—		4		(15,305)		13
Operating income (loss) from discontinued operations	—		(2,322)		(15,163)		(2,655)
Interest income, net	—		98		—		355
Income (loss) from discontinued operations before income taxes	—		(2,224)		(15,163)		(2,300)
Income tax (expense) benefit	—		(2,756)		—		(494)
Income (loss) from discontinued operations	—		532		(15,163)		(1,806)
(1) Includes $15.2 million loss on sale of discontinued operations recorded during the thirty-nine weeks ended November 1, 2025.

The Company provides certain transition services to support the divested business in accordance with the Interest Purchase Agreement.

The assets and liabilities of the Pura Vida operations have been reflected as assets and liabilities of discontinued operations in the Consolidated Balance Sheet as of February 1, 2025. The assets and liabilities were as follows:

	November 1, 2025		February 1, 2025
Assets of discontinued operations
Cash and cash equivalents	$	—	$	1,738
Accounts receivable, net	—		995
Inventories	—		18,578
Prepaid expenses and other current assets	—		1,050
Total current assets of discontinued operations	$	—	$	22,361
Operating right-of-use assets	—		3,729
Property, plant, and equipment, net	—		1,628
Other assets	—		17
Total long-term assets of discontinued operations	$	—	$	5,374
Liabilities of discontinued operations
Accounts payable	$	—	$	2,584
Accrued employment costs	—		562
Short-term operating lease liabilities	—		925
Other accrued liabilities	—		1,952
Total current liabilities of discontinued operations	$	—	$	6,023
Long-term operating lease liabilities	—		3,388
Total long-term liabilities of discontinued operations	$	—	$	3,388

The following table presents cash flows from operating and investing activities for discontinued operations for the thirty-nine weeks ended November 1, 2025 and November 2, 2024:

	Thirty-Nine Weeks Ended
	November 1, 2025		November 2, 2024
Cash used in operating activities - discontinued operations	$	(2,115)	$	(469)
Cash provided by (used in) investing activities - discontinued operations	2		(570)