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INCOME TAXES (Tables)

12 Months Ended

Jan. 03, 2026

Schedule of Components of Income Before Income Taxes

The components of income before income taxes were as follows for the periods indicated (in thousands):


	Fiscal Year Ended
	January 3, 2026		December 28, 2024		December 30, 2023
Domestic	$	204,410	$	219,941	$	215,490
Foreign	15,871		12,907		10,456
Income before income taxes	$	220,281	$	232,848	$	225,946

Schedule of Components of Income Tax Expense (Benefit)

The components of income tax expense were as follows for the periods indicated (in thousands):


	Fiscal Year Ended
	January 3, 2026		December 28, 2024		December 30, 2023
Current tax expense:
U.S. federal	$	15,381	$	51,532	$	21,139
State	6,995		12,976		7,659
Foreign	4,820		3,844		1,936
Total current tax expense	27,196		68,352		30,734
Deferred tax expense (benefit):
U.S. federal	26,599		(9,700)		20,136
State	1,669		(1,333)		4,230
Foreign	(570)		(160)		961
Total deferred tax expense (benefit)	27,698		(11,193)		25,327
Total income tax expense	$	54,894	$	57,159	$	56,061

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of income taxes computed at the federal statutory income tax rate of 21% to the effective income tax rate is as follows for the periods indicated (in thousands):


	Fiscal Year Ended
	January 3, 2026				December 28, 2024				December 30, 2023
U.S. Federal Statutory Tax Rate	$	46,259	21.0	%	$	48,898	21.0	%	$	47,449	21.0	%
State & local income taxes, net of federal income tax effect(1)	6,490		2.9	%	7,404		3.2	%	7,359		3.3	%
Foreign tax effects	917		0.4	%	973		0.4	%	701		0.3	%
Effect of cross-border tax laws
Foreign-derived intangible income	(2,993)		(1.4)	%	(4,166)		(1.8)	%	(3,192)		(1.4)	%
Other	(74)		—	%	(437)		(0.2)	%	400		0.2	%
Tax credits	(1,855)		(0.8)	%	(1,834)		(0.8)	%	(1,497)		(0.7)	%
Nontaxable or nondeductible items
Non-deductible portion of executive compensation	3,209		1.4	%	2,235		1.0	%	939		0.4	%
Other	1,710		0.8	%	1,373		0.6	%	872		0.4	%
Changes in unrecognized tax benefits	1,227		0.6	%	3,340		1.4	%	3,030		1.3	%
Other adjustments	4		—	%	(627)		(0.3)	%	—		—	%
Effective income tax rate	$	54,894	24.9	%	$	57,159	24.5	%	$	56,061	24.8	%

_________________________

(1)The states that contribute to the majority (greater than 50%) of the tax effect in this category include California, Georgia, New York, Pennsylvania, and Wisconsin for 2025, California, Illinois, New Jersey, New York, Pennsylvania, and Wisconsin for 2024, and California, Illinois, New York, Pennsylvania, Tennessee, and Wisconsin for 2023.

Schedule of Income Tax Paid, Net of Refunds

The amount of income tax paid, net of refunds, are as follows (in thousands):


	Fiscal Year Ended
	January 3, 2026		December 28, 2024		December 30, 2023
Federal	$	34,000	$	54,000	$	4,000
State
New York	—		—		929
Pennsylvania	—		—		1,720
All states representing less than five percent of total	9,815		8,377		3,668
Foreign
Australia	—		—		1,871
Canada	—		—		1,564
All foreign jurisdictions representing less than five percent of total	4,233		2,827		379
Total income taxes paid, net of refunds(1)	$	48,048	$	65,204	$	14,131

_________________________

(1)All jurisdictions in which income taxes paid (net of refunds received) were equal to or greater than five percent of total income taxes paid are included above. If the noted jurisdiction did not meet the five percent threshold for a particular year, the amount for that year is not separately stated.

Schedule of Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities consisted of the following for the periods indicated (in thousands):


	Fiscal Year Ended
	January 3, 2026		December 28, 2024
Deferred tax assets:
Accrued liabilities	$	5,204	$	8,986
Allowances and other reserves	3,626		3,819
Inventory	3,953		3,563
Stock-based compensation	7,071		6,929
Operating lease liabilities	37,751		22,704


Capitalized research and development expenditures	2,898		13,407
Other	4,161		4,916
Total deferred tax assets	$	64,664	$	64,324
Deferred tax liabilities:
Operating lease assets	$	(31,979)	$	(19,022)
Prepaid expenses	(83)		(32)
Property and equipment	(19,328)		(8,227)
Intangible assets	(32,515)		(28,249)
Other	(19)		(40)
Total deferred tax liabilities	(83,924)		(55,570)
Net deferred tax (liabilities) assets	$	(19,260)	$	8,754
Amounts included in the Consolidated Balance Sheets:
Deferred income taxes	$	3,035	$	9,060
Other liabilities	(22,295)		(306)
Net deferred income tax (liabilities) assets	$	(19,260)	$	8,754

Schedule of Unrecognized Tax Benefits

The following table summarizes the activity related to our unrecognized tax benefits for the periods indicated (excluding interest and penalties) (in thousands):


	Fiscal Year Ended
	January 3, 2026		December 28, 2024
Balance, beginning of year	$	16,857	$	14,336
Gross increases related to current year tax positions	1,453		2,924
Gross increases related to prior year tax positions	274		896
Gross decreases related to prior year tax positions	(390)		(17)
Decreases as a result of settlements during the current period	—		(9)
Lapse of statute of limitations	(1,298)		(1,273)

Balance, end of year	$	16,896	$	16,857