Note 4 - Impairment and Other

6 Months Ended

Aug. 02, 2025

Notes to Financial Statements

Restructuring, Impairment, and Other Activities Disclosure [Text Block]

4. Impairment and Other

	Thirteen weeks ended					Twenty-six weeks ended
	August 2,			August 3,		August 2,		August 3,
($ in millions)	2025			2024		2025		2024
Tradename intangible asset impairment	$	—		$	—	$	140	$	—
Goodwill impairment		—			—		110		—
Impairment of long-lived assets and right-of-use assets		(2	)		9		21		16
Acquisition-related costs		15			—		15		—
Reorganization costs		2			—		5		—
Legal claims		—			—		—		7
Total impairment and other	$	15		$	9	$	291	$	23

For the thirteen weeks ended  August 2, 2025, we recorded $15 million of expenses related to our pending acquisition by DICK'S Sporting Goods ("DICK'S"). Acquisition-related charges consisted of costs necessary to consummate the acquisition, including legal and investing banking advisory fees, as well as employee retention costs. Refer to Note 14 for further information. We also recognized a net credit of $2 million for impairment, consisting of a $9 million benefit from lease terminations related to the South Korea business shutdown, partially offset by $4 million of impairment of long-lived assets, primarily for the shutdown of a distribution center and $3 million of accelerated tenancy from the closure of our global headquarters. Finally, we recognized $2 million of reorganization costs primarily related to the closure and relocation of the Company's global headquarters and other shutdown costs related to our businesses in South Korea, Denmark, Norway, and Sweden, and a distribution center.

Additionally, during the twenty-six weeks ended August 2, 2025, we recorded non-cash impairment charges of $140 million to write down the WSS tradename and $110 million charge to write down goodwill, as a result of a triggering event due to a reduction in the Company's stock price and resulting market capitalization, coupled with general macroeconomic factors. Non-cash impairment charges of long-lived assets and right-of-use assets, as well as related accelerated amortization and lease terminations, related to the relocation of the global headquarters and the shutdown of the businesses that formerly operated in South Korea, Denmark, Norway, and Sweden totaled $21 million for the twenty-six weeks ended August 2, 2025. Reorganization costs totaled $5 million for the twenty-six weeks ended August 2, 2025.