INTANGIBLE ASSETS

12 Months Ended

Jan. 31, 2025

INTANGIBLE ASSETS

INTANGIBLE ASSETS

NOTE 7 — INTANGIBLE ASSETS

Intangible assets consist of:

January 31, 2025	Estimated Life	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
		(In thousands)
Finite-lived intangible assets
Licenses	14 years	$	18,765	$	(18,057)	$	708
Customer relationships	15-17 years		52,198		(28,601)		23,597
Other	5-10 years		5,833		(3,045)		2,788
Total finite-lived intangible assets		$	76,796	$	(49,703)	$	27,093
Indefinite-lived intangible assets
Trademarks							608,913
Total indefinite-lived intangible assets							608,913
Total intangible assets, net						$	636,006

January 31, 2024	Estimated Life	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
		(In thousands)
Finite-lived intangible assets
Licenses	14 years	$	19,152	$	(17,930)	$	1,222
Customer relationships	15-17 years		52,592		(25,903)		26,689
Other	5-10 years		9,496		(5,731)		3,765
Total finite-lived intangible assets		$	81,240	$	(49,564)	$	31,676
Indefinite-lived intangible assets
Trademarks							630,333
Total indefinite-lived intangible assets							630,333
Total intangible assets, net						$	662,009

Amortization expense

Amortization expense with respect to finite-lived intangibles amounted to $5.2 million, $5.4 million and $3.9 million for the years ended January 31, 2025, 2024 and 2023, respectively.

The estimated amortization expense with respect to intangibles for the next five years is as follows:

Year Ending January 31,	Amortization Expense
	(In thousands)
2026	$	3,904
2027		3,651
2028		3,313
2029		3,234
2030		3,187

Intangible assets with finite lives are amortized over their estimated useful lives and measured for impairment when events or circumstances indicate that the carrying value may be impaired.

Goodwill

There was no goodwill recognized during the year ended January 31, 2025 or January 31, 2024.

Impairment

Goodwill represents the excess of the purchase price and related costs over the value assigned to net tangible and identifiable intangible assets of businesses acquired and accounted for under the purchase method. The Company reviews and tests its goodwill and intangible assets with indefinite lives for impairment at least annually, or more frequently if events or changes in circumstances indicate that the carrying amount of such assets may be impaired. The Company performs its goodwill test as of January 31 of each year, if applicable, using a qualitative evaluation or a quantitative test using an income approach through a discounted cash flow analysis methodology. The discounted cash flow approach requires that certain assumptions and estimates be made regarding industry economic factors and future profitability. The Company also performs its annual test for intangible assets with indefinite lives as of January 31 of each year using a qualitative evaluation or a quantitative test using a relief from royalty method, another form of the income approach. The relief from royalty method requires assumptions regarding industry economic factors and future profitability.

The carrying value of the Company’s goodwill was fully impaired in fiscal 2023 as a result of our annual impairment test. There was no new goodwill recognized in fiscal 2024 or fiscal 2025.

Fiscal 2023 Annual Goodwill Impairment Test

The Company performed its annual test of its wholesale reporting unit as of January 31, 2023 by electing to bypass the qualitative assessment and proceed directly to the quantitative impairment test using a discounted cash flows method to estimate the fair value of its wholesale reporting unit. The Company made this election due to its decline in market capitalization.

The fair value of the wholesale reporting unit for goodwill impairment testing was determined using an income approach and validated using a market approach. The income approach was based on discounted projected future (debt-free) cash flows for the reporting unit. The discount rate applied to these cash flows was based on the weighted average cost of capital for the wholesale reporting unit, which takes market participant assumptions into consideration, inclusive of a Company-specific 7.5% risk premium to account for the additional risk of uncertainly perceived by market participants related to the Company’s overall cash flows. Estimated future operating cash flows were discounted at a rate of 17.5% to account for the relative risks of the estimated future cash flows. For the market approach, used to validate the results of the income approach method, the Company used the guideline company method, which analyzes market multiples of adjusted earnings before interest, taxes, depreciation and amortization for a group of comparable public companies.

As a result of the Company’s fiscal 2023 annual impairment test, the Company recorded a $347.2 million non-cash impairment charge during its fourth quarter of fiscal 2023 to fully impair the carrying value of its goodwill, which was included in assets impairments in the Company’s consolidated statements of operations and comprehensive income (loss). This impairment charge was recorded to the Company’s wholesale operations segment.

Fiscal 2025 Annual Indefinite-Lived Intangible Assets Impairment Test

The Company performed its annual test of its indefinite-lived trademarks as of January 31, 2025 using a qualitative evaluation or a quantitative impairment test using a relief from royalty method, another form of the income approach. The relief from royalty method requires assumptions regarding industry economic factors and future profitability. The Company’s fiscal 2025 testing determined that the fair value of each of its indefinite-lived intangible assets substantially exceeded its carrying value except for its Sonia Rykiel trademark. As a result of the fiscal 2025 annual impairment test, the Company recorded a $7.4 million non-cash impairment charge during its fourth quarter of fiscal 2025 to fully impair the carrying value of its Sonia Rykiel trademark, which was included in asset impairments in the Company’s consolidated statements of operations and comprehensive income (loss). This impairment charge was recorded to the Company’s wholesale operations segment.

Fiscal 2024 Annual Indefinite-Lived Intangible Assets Impairment Test

The Company performed its annual test of its indefinite-lived trademarks as of January 31, 2024 using a qualitative evaluation or a quantitative impairment test using a relief from royalty method, another form of the income approach. The relief from royalty method requires assumptions regarding industry economic factors and future profitability. The Company’s fiscal 2024 testing determined that the fair value of each of its indefinite-lived intangible assets substantially exceeded its carrying value except for its Sonia Rykiel trademark. As a result of the fiscal 2024 annual impairment test, the Company recorded a $5.9 million non-cash impairment charge during its fourth quarter of fiscal 2024 to partially impair the carrying value of its Sonia Rykiel trademark, which was included in asset impairments in the Company’s consolidated statements of operations and comprehensive income (loss). This impairment charge was recorded to the Company’s wholesale operations segment.

Fiscal 2023 Annual Indefinite-Lived Intangible Assets Impairment Test

The Company performed its annual test of its indefinite-lived trademarks as of January 31, 2023 using a qualitative evaluation or a quantitative impairment test using a relief from royalty method, another form of the income approach. The

relief from royalty method requires assumptions regarding industry economic factors and future profitability. The Company determined that the fair values of each of its indefinite-lived intangible assets substantially exceeded its carrying value and, therefore, there were no impairments identified as of January 31, 2023 as a result of these tests.

The Company’s indefinite-lived trademark balance is primarily composed of the Donna Karan/DKNY trademarks that were acquired in fiscal 2017 and the Karl Lagerfeld trademark that was acquired in fiscal 2023.

The fair value of the Company’s indefinite-lived intangible assets are considered a Level 3 valuation in the fair value hierarchy.