COLUMBIA SPORTSWEAR CO

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We are investing in our strategic priorities to:

Current wording

In addition, we are committed to investing in our strategic priorities with a renewed emphasis to:

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Ultimately, we expect our investments to enable market share capture across our brand portfolio, expand gross margin, improve selling, general and administrative expense efficiency, and drive improved operating margin over the long-term. We seek to bring additional consumer segments to our brands in the marketplace. For the Columbia brand, we are working to establish the Columbia.com site as the best expression of the brand through enhancements to the consumer experience, as well as generally less promotion and discount activity. In an effort to reduce inventories and to assist with our transition of merchandise containing perfluoroalkyl and polyfluoroalkyl substances ("PFAS") chemicals, we opened temporary outlet stores in the U.S., which will remain open through 2024, and begin to ramp down throughout 2025.

Current wording

Ultimately, we expect our investments to enable market share capture across our brand portfolio, expand gross margin, improve selling, general and administrative expense efficiency, and drive improved operating margin over the long-term.

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As part of our strategic priorities, we are implementing a multi-year profit improvement program to accelerate profitable growth and improve the efficiency of our operations. We are focused on four areas of cost reduction and realignment, including:

Current wording

Concurrent with our ACCELERATE Growth Strategy, we continue to make progress on our multi-year profit improvement program to accelerate profitable growth and improve the efficiency of our operations. We are focused on four areas of cost reduction and realignment, including:

Previous wording

When the benefits of this program are combined with the cost savings we anticipate to receive from normalized inventory levels, we believe we can reach $125 million to $150 million in annualized savings by 2026. We anticipate these cost savings will ramp up over the course of 2024 and 2025, with the full benefit being realized in 2026. In 2024, we anticipate realizing approximately $75 million to $90 million in realized cost savings, net of approximately $3 million to $4 million of severance and other costs.

Current wording

When the benefits of this program are combined with the cost savings we anticipate to receive from normalized inventory levels, we believe we can reach $125 million to $150 million in annualized savings by 2026. We anticipate these cost savings will ramp up over the course of

Previous wording

Increasing Competitive Environment |We believe many brands have shifted their strategies and new brands have entered the marketplace to capitalize on the emergence of casual and lifestyle trends. The versatility of casual and lifestyle products provides consumers the ability to use these products in a variety of settings, including outdoor activities. This shift has been evident in both the apparel and footwear product categories. We believe this trend has accelerated because of changes in consumer behavior resulting from the COVID-19 pandemic, which has resulted in an increasingly competitive apparel and footwear marketplace.

Current wording

Increasing U.S. Competitive Environment and Evolving U.S. Consumer Trends |We believe our competition in the historical U.S. outdoor apparel and footwear market has increased as many brands have shifted their strategies and new brands have entered the marketplace to capitalize on the emergence of casualand lifestyle trends. The versatility of casual and lifestyle products provides consumers the ability to use these products in a variety of settings, including outdoor activities. We believe the successful implementation of our strategic priorities, including our Columbia brand ACCELERATE Growth Strategy, will enable us to better compete in this evolved U.S. marketplace in the future.

Previous wording

Promotional and Clearance Environment | Since last year, we have been proactively managing promotional activity on Columbia.com to help establish the site as the best expression of the brand. However, we believe consumers are still seeking value, particularly in the U.S. This is contributing to reduced demand for our direct-to-consumer ("DTC") e-commerce sites and branded stores. To capture demand associated with value conscious consumers, we have increasingly relied on our fleet of DTC brick-and-mortar outlet stores and clearance locations, which offer discounted and clearance merchandise. The use of temporary clearance stores results in lower DTC product margins, increased SG&A expenses and modest operating income. We believe this method of liquidation results in stronger financial returns to the Company in comparison to wholesale closeout sales channel alternatives and has a less disruptive impact in the marketplace. We anticipate continuing to utilize temporary clearance locations to assist with inventory liquidation through 2024 with plans to ramp down these locations throughout 2025.

Current wording

Promotional and Clearance Environment | Since last year, we have been proactively managing promotional activity on Columbia.com to help establish the site as the best expression of the Brand. However, we believe certain consumers are still seeking value, particularly in the U.S. This, among other factors, is contributing to reduced demand for our direct-to-consumer ("DTC") e-commerce sites for certain brands and branded stores. To capture demand associated with value conscious consumers, we have increasingly relied on our fleet of DTC brick-and-mortar outlet stores and clearance locations, which offer discounted and clearance merchandise. Further, in an effort to reduce inventories and to assist with our transition of merchandise containing perfluoroalkyl and polyfluoroalkyl substances ("PFAS") chemicals, we opened temporary outlet stores in the U.S in 2024. The use of temporary clearance stores results in lower DTC product margins, increased SG&A expenses and modest operating income. We believe this method of liquidation results in stronger financial returns to the Company in comparison to wholesale closeout sales channel alternatives and has a less disruptive impact in the marketplace. We anticipate continuing to utilize temporary clearance locations to assist with inventory liquidation through 2024 with plans to ramp down these locations throughout 2025.

Previous wording

Freight Cost Environment | Over the past year, we have realized significant declines in ocean freight rates and costs in comparison to prior year elevated levels. These lower ocean freight rates resulted in substantially lower inbound freight costs which benefited our gross margin in 2023 and first half of 2024. As a result of ongoing conflict disrupting ocean transport through the Red Sea, spot ocean freight rates have begun to increase, and ocean carriers have initiated peak season surcharges. We utilize contracted pricing for the bulk of our ocean freight, which minimizes our exposure to spot pricing. However, if the conflict and ocean freight rate trends persist beyond our current contracts, we could incur increased ocean freight costs in future periods. Additionally, we may incur peak season surcharges and/or need to pay a premium to secure needed capacity.

Current wording

Freight Cost Environment | We have realized declines in ocean freight rates and costs in comparison to prior elevated levels. These lower ocean freight rates resulted in substantially lower inbound freight costs, which benefited our gross margin in 2023 and through the third quarter of 2024. We anticipate these lower ocean freight costs will abate providing less of a gross margin benefit in the fourth quarter of 2024 and diminishing even more so into 2025.

Previous wording

Heightened Geopolitical Risk | We sell our products in more than 100 countries and our ability to sell in certain markets may be impacted by ongoing geopolitical tensions. We believe these tensions will remain elevated and have manifested, and will continue to manifest, themselves in certain regions where we operate.

Current wording

Heightened Geopolitical Risk | We sell our products in more than 100 countries and our ability to sell, import into and produce in certain markets may be impacted by ongoing geopolitical tensions. We believe these tensions will remain elevated and have manifested, and will continue to manifest, themselves in certain regions where we operate.

Previous wording

Increasing Regulatory Environment | Recently, the number of regulations at the global and jurisdictional level impacting our business, and in particular our products, has significantly increased. We expect this trend to continue, and as a result, will impact our expenses, product input costs and ultimately our products, which may in turn impact our revenue. These regulatory matters at a minimum include regulations related to climate, social, privacy, and product chemistry. For example, in anticipation of the effectiveness of the regulations in California and New York states related to PFAS chemicals, we have been working to eliminate PFAS chemicals across our global product line. These PFAS matters have and may continue to result in a more promotional environment in 2024 as retailers move through merchandise containing PFAS.

Current wording

Increasing Regulatory Environment | Recently, the number of regulations at the global and jurisdictional level impacting our business, and in particular our products, has significantly increased. We expect this trend to continue and, as a result, will impact our expenses, product input costs and ultimately our products, which may in turn impact our revenue. These regulatory matters at a minimum include regulations related to climate, social, privacy, and product chemistry. For example, in anticipation of the effectiveness of the regulations in California and New York states related to PFAS chemicals, we have worked to eliminate PFAS chemicals across our global product line. These PFAS matters have resulted in a more promotional environment in 2024 as retailers sell through merchandise containing PFAS.

Previous wording

Our global net sales decrease primarily reflects lower wholesale net sales in the U.S. for the six months ended June 30, 2024, compared to same period in 2023. DTC net sales increased, reflecting growth in our brick-and-mortar business from temporary and new stores, partially offset by declines in our e-commerce business for the six months ended June 30, 2024, compared to the same period in 2023. The declines in wholesale net sales resulted from retailer cautiousness and a difficult competitive environment in the U.S. The declines in e-commerce net sales resulted from softness in the U.S., which we attribute to a challenging e-commerce environment for traditional outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com.

Current wording

DTC net sales increased, reflecting growth in our brick-and-mortar business from temporary and new stores, partially offset by declines in our e-commerce business, compared to the same period in 2023. The declines in e-commerce net sales resulted from softness in the U.S., which we attribute to a challenging e-commerce environment for outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com.

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•favorable other costs, including lower inbound freight costs.

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•favorable other costs, including lower inbound freight costs; partially offset by

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•higher omni-channel expenses, reflecting higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expenses.

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•higher omni-channel expenses of $14.3 million, reflecting higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expense; and

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•lower supply chain expenses, reflecting decreased global distribution center expenses resulting from more normalized inventory levels; and

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•lower supply chain expenses, reflecting decreased global distribution center expenses resulting from more normalized inventory levels and supply chain optimization efforts.

Previous wording

Income tax expense (benefit) decreased to ($3.2) million for the second quarter of 2024 from a tax expense of $1.2 million for the comparable period in 2023. Our effective tax rate was 21.6% for the three months ended June 30, 2024 compared to 12.6% for the same period in 2023. For the three months ended June 30, 2024, our effective tax rate was primarily impacted by a non-recurring expense associated with stock compensation benefits. For the three months ended June 30, 2023, our effective tax rate was primarily impacted by a non-recurring benefit related to foreign currency loss resulting from an intercompany transaction.

Current wording

Income tax expense decreased to $29.0 million for the third quarter of 2024 from a tax expense of $32.6 million for the comparable period in 2023. Our effective tax rate was 24.4% for the three months ended September 30, 2024 compared to 24.0% for the same period in 2023. For the three months ended September 30, 2024, our effective tax rate was primarily impacted by a non-recurring expense related to a foreign currency gain resulting from an intercompany transaction. For the three months ended September 30, 2023, our effective tax rate was primarily impacted by a non-recurring benefit related to a foreign currency loss resulting from an intercompany transaction.

Previous wording

Our global net sales decrease primarily reflects lower wholesale net sales in the U.S., partially offset by strength in international markets, compared to the same period in 2023. DTC net sales were flat, with declines in our e-commerce business offset by growth in our brick-and-mortar business from temporary and new stores, compared to the same period in 2023. The declines in wholesale net sales resulted from retailer cautiousness and a difficult competitive environment in the U.S. The declines in e-commerce net sales resulted from softness in the U.S., which we attribute to a challenging e-commerce environment for traditional outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com.

Current wording

DTC net sales increased, reflecting growth in our brick-and-mortar business from temporary and new stores, partially offset by declines in our e-commerce business, compared to the same period in 2023. The declines in e-commerce net sales have resulted from softness in the U.S. throughout the year, which we attribute to a challenging environment for outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com.

Previous wording

•favorable region and channel net sales mix.

Current wording

•favorable region and channel net sales mix; partially offset by

Previous wording

•higher omni-channel expenses of $17.4 million, reflecting higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expenses.

Current wording

•higher omni-channel expenses of $31.7 million, reflecting higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expenses; partially offset by

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•lower supply chain expenses of $17.1 million, reflecting decreased global distribution center expenses resulting from more normalized inventory levels; and

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•lower supply chain expenses of $26.0 million, reflecting decreased global distribution center expenses resulting from more normalized inventory levels and supply chain optimization efforts; and

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•lower demand creation expenses, primarily reflecting decreased net sales; partially offset by

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•lower demand creation expenses, primarily reflecting decreased net sales.

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Income tax expense decreased to $8.6 million through the second quarter of 2024 from $15.5 million for the comparable period in 2023. For the six months ended June 30, 2024, our effective tax rate was primarily impacted by a benefit related to a non-recurring decrease in foreign withholding taxes. For the six months ended June 30, 2023, our effective income tax rate was primarily impacted by a non-recurring benefit related to foreign currency loss resulting from an intercompany transaction.

Current wording

Income tax expense decreased to $37.6 million through the third quarter of 2024 from $48.1 million for the comparable period in 2023. Our effective tax rate was 23.8% for the nine months ended September 30, 2024 compared to 23.4% for the same period in 2023. For the nine months ended September 30, 2024, our effective tax rate was primarily impacted by a non-recurring benefit related to a decrease in accrued foreign withholding taxes. For the nine months ended September 30, 2023, our effective income tax rate was primarily impacted by a non-recurring benefit related to a foreign currency loss resulting from an intercompany transaction.

Previous wording

U.S. operating income decreased $31.6 million to $23.5 million, or 6.9% of net sales, for the second quarter of 2024 from $55.1 million, or 13.8% of net sales, for the comparable period in 2023. The decrease was driven primarily by decreased net sales and gross margin, partially offset by lower SG&A expenses. U.S. net sales decreased $58.9 million, or 15%, for the second quarter of 2024, compared to the same period in 2023, driven primarily by decreased net sales in our U.S. wholesale business. DTC net sales decreased modestly as a result of lower e-commerce net sales, partially offset by net sales growth from our brick-and-mortar business. The declines in wholesale net sales resulted from retailer cautiousness and a difficult competitive environment in the U.S. The declines in e-commerce net sales resulted from softness in the U.S., which we attribute to a challenging e-commerce environment for traditional outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com. The increases in brick-and-mortar net sales were primarily driven by our temporary clearance locations which have continued to support our excess inventory liquidation efforts. As of June 30, 2024, our U.S. business operated 46 temporary clearance locations, compared to 30 locations for the comparable period in 2023. In addition, our U.S. business operated 163 retail stores as of June 30, 2024, compared to 157 stores for the comparable period in 2023. U.S. SG&A expenses increased as a percentage of net sales to 42.6% for the second quarter of 2024 compared to 38.7% for the same period in 2023, driven by fixed SG&A expenses and decreased net sales. In total, U.S. SG&A expenses decreased for the second quarter of 2024, compared to the same period in 2023, primarily driven by lower supply chain expenses resulting from more normalized inventory levels and lower demand creation expenses, partially offset by higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expenses.

Current wording

U.S. operating income decreased $16.2 million to $115.4 million, or 20.2% of net sales, for the third quarter of 2024 from $131.6 million, or 20.7% of net sales, for the comparable period in 2023. The decrease was driven primarily by decreased net sales and gross margin, partially offset by lower SG&A expenses. U.S. net sales decreased $64.1 million, or 10%, for the third quarter of 2024, compared to the same period in 2023, driven primarily by decreased net sales in our U.S. wholesale business. DTC net sales decreased modestly as a result of lower e-commerce net sales, partially offset by net sales growth from our brick-and-mortar business. The declines in wholesale net sales reflect the impact of lower Fall 2024 wholesale orders as a result of retailer cautiousness and a difficult competitive environment in the U.S., as well as delayed shipment of Fall 2024 wholesale orders in the third quarter compared to earlier shipment of Fall 2023 orders. The declines in e-commerce net sales resulted from continued softness in the U.S., which we attribute to a challenging e-commerce environment for outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com. The increases in brick-and-mortar net sales were primarily driven by temporary clearance locations and new stores, coupled with increased productivity from existing stores. As of September 30, 2024, our U.S. business operated 42 temporary clearance locations, compared to 36 locations for the comparable period in 2023. In addition, our U.S. business operated 169 retail stores as of September 30, 2024, compared to 159 stores for the comparable period in 2023. U.S. SG&A expenses increased as a percentage of net sales to 30.2% for the third quarter of 2024 compared to 27.6% for the same period in 2023, driven by fixed SG&A expenses and decreased net sales. In total, U.S. SG&A expenses decreased for the third quarter of 2024, compared to the same period in 2023, primarily driven by lower supply chain expenses resulting from more normalized inventory levels and supply chain optimization efforts, as well as lower demand creation expenses, partially offset by higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expenses.

Previous wording

U.S. operating income decreased $40.2 million to $96.5 million, or 11.8% of net sales, for the six months ended June 30, 2024 from $136.7 million, or 14.9% of net sales, for the comparable period in 2023. The decrease was driven primarily by decreased net sales and gross margin, partially offset by lower SG&A expenses. U.S. net sales decreased $102.0 million, or 11%, for the six months ended June 30, 2024, compared to the same period in 2023, driven primarily by decreased net sales in our U.S. wholesale business. DTC net sales decreased modestly as a result of lower e-commerce net sales, partially offset by net sales growth from our brick-and-mortar business. The declines in wholesale net sales resulted from retailer cautiousness and a difficult competitive environment in the U.S. The declines in e-commerce net sales resulted from softness in the U.S., which we attribute to a challenging e-commerce environment for traditional outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com. The increases in brick-and-mortar net sales were primarily driven by our temporary clearance locations, which have continued to support our excess inventory liquidation efforts. U.S. SG&A expenses increased as a percentage of net sales to 37.9% for the six months ended June 30, 2024 compared to 35.6% for the same period in 2023, primarily driven by decreased net sales. In total, U.S. SG&A expenses decreased for the six months ended June 30, 2024 compared to the same period in 2023, primarily driven by lower supply chain expenses resulting from more normalized inventory levels and lower demand creation expenses, partially offset by higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expenses.

Current wording

U.S. operating income decreased $56.5 million to $211.8 million, or 15.3% of net sales, for the nine months ended September 30, 2024 from $268.3 million, or 17.3% of net sales, for the comparable period in 2023. The decrease was driven primarily by decreased net sales and gross margin, partially offset by lower SG&A expenses. U.S. net sales decreased $166.1 million, or 11%, for the nine months ended September 30, 2024, compared to the same period in 2023, driven primarily by decreased net sales in our U.S. wholesale business. DTC net sales decreased modestly as a result of lower e-commerce net sales, partially offset by net sales growth from our brick-and-mortar business. The declines in wholesale net sales have generally resulted from retailer cautiousness and a difficult competitive environment throughout the year. The declines in e-commerce net sales resulted from continued softness in the U.S., which we attribute to a challenging e-commerce environment for outdoor brands, coupled with efforts to de-emphasize promotions on Columbia.com. The increases in brick-and-mortar net sales were primarily driven by temporary clearance locations and new stores, coupled with increased productivity of existing stores for the nine months ended September 30, 2024. U.S. SG&A expenses increased as a percentage of net sales to 34.7% for the nine months ended September 30, 2024 compared to 32.3% for the same period in 2023, primarily driven by fixed SG&A expenses and decreased net sales. In total, U.S. SG&A expenses decreased for the nine months ended September 30, 2024 compared to the same period in 2023, primarily driven by lower supply chain expenses resulting from more normalized inventory levels and supply chain optimization efforts, as well as lower demand creation expenses, partially offset by higher DTC brick-and-mortar expenses, including costs associated with new stores and temporary clearance locations and personnel expenses.

Previous wording

LAAP operating income increased $5.5 million to $27.9 million, or 11.7% of net sales, for the six months ended June 30, 2024 from $22.4 million, or 9.8% of net sales, for the comparable period in 2023. The increase was driven primarily by increased net sales and gross margin. LAAP net sales increased $8.5 million, or 4% (9% constant-currency), for the six months ended June 30, 2024, compared to the same period in 2023. Increased LAAP net sales were primarily driven by our China business, which continues to see strong consumer demand. Japan net sales declined, driven by unfavorable effects from foreign currency fluctuation, which more than offset constant-currency net sales growth resulting from international tourism. Korea net sales also declined. LAAP SG&A expenses decreased as a percentage of net sales to 44.1% for the six months ended June 30, 2024, compared to 45.7% for the same period in 2023.

Current wording

LAAP operating income increased $11.4 million to $48.3 million, or 12.9% of net sales, for the nine months ended September 30, 2024 from $36.9 million, or 10.7% of net sales, for the comparable period in 2023. The increase was driven primarily by increased net sales and gross margin. LAAP net sales increased $28.1 million, or 8% (12% constant-currency), for the nine months ended September 30, 2024, compared to the same period in 2023, primarily driven by our China business. Increased net sales in our China business reflected continued strong

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EMEA operating income decreased $0.6 million to $14.4 million, or 13.9% of net sales, for the second quarter of 2024 from $15.0 million, or 14.9% of net sales, for the comparable period in 2023. EMEA net sales increased $3.1 million, or 3% (3% constant-currency), for the second quarter of 2024, compared to the same period in 2023. EMEA net sales increased primarily in our Europe-direct business, boosted by continued momentum and increased traffic within our brick-and-mortar and e-commerce businesses. This net sales increase was partially offset by decreased net sales in our EMEA distributor business. EMEA SG&A expenses increased as a percentage of net sales to 28.6% for the second quarter of 2024 compared to 26.7% in 2023, primarily driven by higher DTC brick-and-mortar expenses and personnel expenses.

Current wording

EMEA operating income decreased $2.8 million to $66.8 million, or 19.1% of net sales, for the nine months ended September 30, 2024 from $69.6 million, or 20.6% of net sales, for the comparable period in 2023. The decrease was driven primarily by increased SG&A expenses. EMEA net sales increased $11.7 million, or 3% (3% constant-currency), for the nine months ended September 30, 2024, compared to the same period in 2023, primarily driven by our Europe-direct business. Increased net sales in our Europe-direct business were driven by robust demand throughout our DTC brick-and-mortar and e-commerce businesses. Our EMEA distributor business also saw increased net sales. This net sales increase was partially offset by decreased net sales in our Europe-direct wholesale business. EMEA SG&A expenses increased as a percentage of net sales to 28.6% for the nine months ended September 30, 2024 compared to 26.5% for the same period in 2023, primarily driven by higher personnel expenses and variable DTC expenses.

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Unallocated corporate expenses increased by $5.4 million to $148.1 million for the six months ended June 30, 2024 from $142.7 million for the same period in 2023, largely driven by higher personnel expenses.

Current wording

Unallocated corporate expenses increased by $8.3 million to $227.0 million for the nine months ended September 30, 2024 from $218.7 million for the same period in 2023.

Previous wording

The change in cash flows provided by operating activities was driven by a $124.7 million increase in cash provided by changes in assets and liabilities, partially offset by a $25.5 million decrease in cash provided by net income and non-cash adjustments. The most significant comparative changes in assets and liabilities included Accounts payable, Inventories, and Prepaid expenses and other current assets. The $100.4 million increase in cash provided by Accounts payablewas primarily driven by lower inventory receipts in the second quarter of 2024 compared to the second quarter of 2023. The $46.5 million decrease in cash used in Inventories reflected a decrease in inventory as we curtailed inventory purchases to compensate for elevated inventories exiting 2022 and liquidated excess inventory levels throughout 2023 and the first half of 2024. These amounts were partially offset by the $33.2 million decrease in cash provided by Prepaid expenses and other current assets primarily driven by lower inventory prepayments.

Current wording

The change in cash flows used in operating activities was driven by a $55.9 million increase in cash used in changes in assets and liabilities, as well as a $42.9 million decrease in cash provided by net income and non-cash adjustments. The most significant comparative changes in assets and liabilities included Inventories, Prepaid expenses and other current assets, and Accounts payable. The $185.8 million decrease in cash provided by Inventories reflected cash provided of $135.4 million for the nine months ended September 30, 2023 as we liquidated excess inventory levels throughout 2023, as well as cash used of $50.3 million for the nine months ended September 30, 2024 as we aligned inventory supply with anticipated seasonal demand. The $21.8 million decrease in cash provided by Prepaid expenses and other current assets was primarily driven by lower inventory prepayments. These amounts were partially offset by the $135.1 million decrease in cash used in Accounts payable driven by the timing of inventory receipts, including higher in-season inventory, and related payments, including a reduction in the use of early payments.

Previous wording

Net cash provided by investing activities was $30.0 million for the six months ended June 30, 2024, compared to $89.9 million of cash used in investing activities for the six months ended June 30, 2023. For the 2024 period, net cash provided by investing activities consisted of $446.1 million in cash provided by sales and maturities of short-term investments, partially offset by $388.3 million in cash used for purchases of short-term investments and $27.8 million for capital expenditures. For the 2023 period, net cash used in investing activities consisted of $117.9 million in purchases of short-term investments and $22.8 million for capital expenditures, partially offset by $50.7 million provided by sales and maturities of short-term investments.

Current wording

Net cash provided by investing activities was $321.1 million for the nine months ended September 30, 2024, compared to $38.5 million of cash used in investing activities for the nine months ended September 30, 2023. For the 2024 period, net cash provided by investing activities consisted of $751.2 million in cash provided by sales and maturities of short-term investments, partially offset by $388.3 million in cash used for purchases of short-term investments and $41.7 million for capital expenditures. For the 2023 period, net cash used in investing activities consisted of $117.9 million in purchases of short-term investments and $41.4 million for capital expenditures, partially offset by $120.7 million provided by sales and maturities of short-term investments.

Previous wording

Net cash used in financing activities was $139.0 million for the six months ended June 30, 2024 compared to $115.2 million for the six months ended June 30, 2023. For the 2024 period, net cash used in financing activities primarily consisted of repurchases of common stock of $102.6 million and dividend payments to our shareholders of $35.6 million. For the 2023 period, net cash used in financing activities primarily consisted of repurchases of common stock of $78.3 million and dividend payments to our shareholders of $37.1 million.

Current wording

Net cash used in financing activities was $284.6 million for the nine months ended September 30, 2024 compared to $197.6 million for the nine months ended September 30, 2023. For the 2024 period, net cash used in financing activities primarily consisted of repurchases of common stock of $230.9 million and dividend payments to our shareholders of $52.9 million. For the 2023 period, net cash used in financing activities primarily consisted of repurchases of common stock of $144.6 million and dividend payments to our shareholders of $55.4 million.

Previous wording

As of June 30, 2024, we had cash and cash equivalents of $341.8 million and short-term investments of $369.3 million, compared to $350.3 million and $414.2 million, respectively, as of December 31, 2023 and $231.6 million and $71.2 million, respectively, as of June 30, 2023.

Current wording

As of September 30, 2024, we had cash and cash equivalents of $306.7 million and short-term investments of $67.2 million, compared to $350.3 million and $414.2 million, respectively, as of December 31, 2023 and $213.3 million and $1.5 million, respectively, as of September 30, 2023.

Previous wording

As of June 30, 2024, our European subsidiary had available an unsecured, committed line of credit, which is guaranteed by the Company and provides for borrowings up to €4.4 million (approximately US$4.7 million). There was no balance outstanding under the facility.

Current wording

As of September 30, 2024, our European subsidiary had available an unsecured, committed line of credit, which is guaranteed by the Company and provides for borrowings up to €4.4 million (approximately US$4.9 million). There was no balance outstanding under the facility.

Previous wording

As of June 30, 2024, collectively, our international subsidiaries had unsecured, uncommitted lines of credit, credit facilities and overdraft facilities, providing for borrowings up to approximately US$103.2 million. There was no balance outstanding under these facilities.

Current wording

As of September 30, 2024, collectively, our international subsidiaries had unsecured, uncommitted lines of credit, credit facilities and overdraft facilities, providing for borrowings up to approximately US$106.4 million. There was no balance outstanding under these facilities.

Previous wording

Our working capital management goals include maintaining an optimal level of inventory necessary to deliver goods on time to our customers and our retail stores to satisfy end consumer demand, alleviating manufacturing capacity constraints, and driving efficiencies to minimize the cycle time from the purchase of inventory from our suppliers to the collection of accounts receivable balances from our customers. Inventory balances may be elevated in advance of periods of expected high demand. As of June 30, 2024, our inventory balance decreased to $823.6 million, compared to $1,162.5 million as of June 30, 2023, driven by a reduction in current season and carryover inventory resulting from lower inventory buys, as well as the use of our outlet stores and temporary clearance locations to profitably sell excess merchandise. We believe older season inventories represent a manageable portion of our total inventory mix.

Current wording

Our working capital management goals include maintaining an optimal level of inventory necessary to deliver goods on time to our customers and our retail stores to satisfy end consumer demand, alleviating manufacturing capacity constraints, and driving efficiencies to minimize the cycle time from the purchase of inventory from our suppliers to the collection of accounts receivable balances from our customers. Inventory balances may be elevated in advance of periods of expected high demand. As of September 30, 2024, our inventory balance decreased to $798.2 million, compared to $885.2 million as of September 30, 2023, driven by a reduction in current season and carryover inventory resulting from lower inventory buys, as well as the use of our outlet stores and temporary clearance locations to profitably sell excess merchandise. We believe older season inventories represent a manageable portion of our total inventory mix.

Previous wording

We have planned 2024 capital expenditures of approximately $60 to $80 million. This includes investments in our DTC operations, including new stores and digital and supply chain capabilities to support our strategic priorities. Our actual capital expenditures may differ from the planned amounts depending on factors such as the timing of system implementations and new store openings and related construction.

Current wording

We have planned 2024 capital expenditures of approximately $60 to $70 million. This includes investments in our DTC operations, including new stores and digital and supply chain capabilities to support our strategic priorities. Our actual capital expenditures may differ from the planned amounts depending on factors such as the timing of system implementations and new store openings and related construction.

Previous wording

Our inventory purchase obligations were $450.9 million as of June 30, 2024, compared to $343.4 million and $301.9 million as of December 31, 2023 and June 30, 2023, respectively.

Current wording

Our inventory purchase obligations were $437.2 million as of September 30, 2024, compared to $343.4 million and $367.3 million as of December 31, 2023 and September 30, 2023, respectively.

Previous wording

Management's discussion and analysis of our financial condition and results of operations are based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make various estimates and judgments that affect reported amounts of assets, liabilities, sales, cost of sales, and expenses and related disclosure of contingent assets and liabilities. We believe that the estimates, assumptions and judgments involved in the accounting for sales reserves, allowance for uncollectible accounts receivable, excess, close-out and slow-moving inventory, impairment of long-lived assets, intangible assets and goodwill, and income taxes have the greatest potential effect on our financial statements, so we consider these to be our critical accounting policies and estimates. Because of the uncertainty inherent in these matters, actual results may differ from the estimates we use in applying these critical accounting policies and estimates. We base our ongoing estimates on historical experience and other assumptions that we believe to be reasonable in the circumstances. Refer to Part II, Item 7 in our Annual Report on Form 10-K for the year ended December 31, 2023 for additional information regarding our critical accounting policies and estimates.

Current wording

Management's discussion and analysis of our financial condition and results of operations are based on our unaudited condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make various estimates and judgments that affect reported amounts of assets, liabilities, sales, cost of sales, and expenses and related disclosure of contingent assets and liabilities. We believe that the estimates, assumptions and judgments involved in the accounting for sales reserves, allowance for uncollectible accounts receivable, excess, close-out and slow-moving inventory, impairment of long-lived assets, intangible assets and goodwill, and income taxes have the greatest potential effect on our financial statements, so we consider these to be our critical accounting policies and estimates. Because of the uncertainty inherent in these matters, actual results may