Restructuring Costs

6 Months Ended

Jun. 29, 2024

Restructuring and Related Activities [Abstract]

Restructuring Costs

Restructuring Costs

In the fourth quarter of 2023, the Company initiated cost reduction actions to reduce operating expenses and accelerate

gross margin initiatives, and recognized $15.7 million of restructuring costs in that quarter. In addition to the costs

incurred in 2023, the Company incurred an additional $1.8 million and $12.4 million of restructuring costs during the

three and six months ended June 29, 2024, respectively. Charges incurred related to this initiative were comprised of

contract termination costs, severance and employee-related benefits, professional fees and other, and asset impairment

charges and are included in the restructuring costs line in the Company’s consolidated statement of operations. The

Company expects an additional $1 million to $2 million of restructuring costs to be incurred through the remainder of

2024.

During the three and six months ended June 29, 2024, the Company recognized $1.8 million and $12.4 million of

restructuring costs, respectively, as follows (in thousands):

	Three Months Ended	Six Months Ended
	June 29, 2024	June 29, 2024
Cash restructuring costs:
Contract termination costs (1)	$(230)	$4,183
Severance and employee-related benefits	401	1,242
Professional fees and other	1,648	4,494
Total cash restructuring costs	1,819	9,919
Non-cash restructuring costs:
Asset impairments (2)	—	2,500
Total restructuring costs	$1,819	$12,419

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(1) Primarily comprised of lease termination costs. The three months ended June 29, 2024 include a change in estimate.

(2) Primarily comprised of impairments of property and equipment.

The following table provides the activity in the Company’s restructuring related liabilities, which are included within

accounts payable, compensation and benefits and other current liabilities on the consolidated balance sheet (in

thousands):

	Six Months Ended
	June 29, 2024
Balance at the beginning of year	$8,720
Expenses	9,919
Cash payments	(16,916)
Balance at the end of the period	$1,723

Since the initiation of cost reduction actions in the fourth quarter of 2023, the Company has recognized a cumulative

$28.1 million of restructuring costs, as follows (in thousands):

	Cumulative
	June 29, 2024
Cash restructuring costs:
Contract termination costs (1)	$11,593
Severance and employee-related benefits	6,208
Professional fees and other	5,604
Total cash restructuring costs	23,405
Non-cash restructuring costs:
Asset impairments (2)	4,742
Total restructuring costs	$28,147

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(1)Primarily comprised of lease termination costs.

(2) Includes impairments of both lease right-of-use assets and property and equipment.