Lulu's Fashion Lounge Holdings, Inc.
For the period ended Jun 28, 2026. Filed Aug 12, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 28, 2026 · Filed Aug 12, 2026
LVLU$10.58+1.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-29; filed 2026-05-13.
0001104659-26-060254
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-28; filed 2026-08-12.
0001104659-26-094904
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 119 previous paragraphs and 149 current paragraphs.
87 unchanged; 28 reworded; 28 added; 1 removed; 3 previous and 6 current paragraphs rearranged.
Tables are not compared: 17 previous and 17 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (28)
Current report
Amendments to our Certificate of Incorporation
Current report
On June 9, 2026, upon obtaining stockholder approval at the 2026 Annual Meeting, we filed with the Secretary of State of Delaware an amendment to our Certificate of Incorporation to decrease the number of authorized shares of our common stock from 250,000,000 to 15,000,000 and to decrease the number of authorized shares of our preferred stock from 10,000,000 to 500,000.
Current report
Additionally, on June 9, 2026, upon obtaining stockholder approval at the 2026 Annual Meeting, we filed with the Secretary of State of Delaware an amendment to our Certificate of Incorporation to provide exculpation to certain officers as permitted by amendments to the Delaware General Corporation Law.
Current report
Approval of Suspension of 2026 Annual RSU Awards and Cash Payment in Lieu Thereof
Current report
On June 3, 2026, the Compensation Committee approved suspending the 2026 Annual RSU Awards to the Company’s independent directors valued at $100,000 pursuant to the Company’s Non-Employee Director Compensation Program, in order to avoid the potential dilutive impact to the Company’s outstanding shares of common stock.
Current report
On July 30, 2026, after consulting with and receiving the recommendations of its independent compensation consultant, the Compensation Committee recommended and the Board of Directors approved a cash payment totaling $125,000 to each of the Company’s independent directors as an alternative form of compensation in lieu of receiving the 2026 Annual RSU Awards. This cash payment will be payable in monthly installments retroactive to the date of the 2026 annual meeting of stockholders and paid through the date of the 2027 annual meeting of stockholders, subject to each independent director’s continued service on the Board of Directors through each payment date.
Current report
Registration Statement on Form S-3
Current report
On July 2, 2026, we filed a Shelf Registration Statement with the SEC, which was declared effective on July 14, 2026. The Shelf Registration Statement permits us to sell, in one or more public offerings, shares of our common stock, shares of preferred stock, warrants, and units in an aggregate amount of up to $7.5 million, subject to limitations in accordance with General Instruction I.B.6 of Form S-3. In no event will we sell shares pursuant to this prospectus with a value of more than one-third of the aggregate market value of our common stock held by non-affiliates in any 12-month period, so long as the aggregate market value of our common stock held by non-affiliates is less than $75.0 million. We have not yet sold any securities under the Shelf Registration Statement. The Shelf Registration Statement will expire on July 14, 2029.
Current report
Nasdaq Listing Compliance Update
Current report
On July 6, 2026, the Company submitted a compliance plan (the “Compliance Plan”) to the Nasdaq Listing Qualifications Staff of The Nasdaq Stock Market LLC (“Nasdaq”) to address its deficiency with the minimum amount of $2.5 million of stockholders’ equity required for continued listing on the Nasdaq Capital Market, as set forth in Nasdaq Listing Rule 5550(b)(1). Subsequently, on August 5, 2026, the Company received notice from Nasdaq confirming the Company had regained compliance with the Nasdaq continued listing requirements by satisfying the alternative market value of listed securities standard of at least $35 million set forth in Nasdaq Listing Rule 5550(b)(2) for ten consecutive business days. The Company’s common stock continues to trade on the Nasdaq Capital Market under the symbol “LVLU”.
Current report
Special Committee of the Board of Directors
Current report
On July 13, 2026, we announced that the Board of Directors had formed a special committee of independent directors (“Special Committee”) to evaluate strategic alternatives available to us to maximize stockholder value. These alternatives include a possible transaction involving the Company and continued execution of our standalone strategic plan. The Special Committee has retained Solomon Partners as its financial advisor and Willkie Farr & Gallagher LLP as its legal advisor to assist in connection with the strategic review process.
Current report
Second Amendment to the 2025 Credit Agreement
Current report
On July 27, 2026, the Company entered into a Second Amendment to the 2025 Credit Agreement, which changes the earliest date the Borrowers can include an increased inventory formula into the revolver borrowing base from August 14, 2026 to July 21, 2026 (the “July 2026 Increased Inventory Availability Period”), provides that, on a going-forward basis after giving effect to the July 2026 Increased Inventory Availability Period, the increased inventory formula may be used once before June 30, 2027 and twice after June 30, 2027 through the third anniversary of the revolver closing date, and provides that during the July 2026 Increased Inventory Availability Period only, for purposes of determining increased reporting requirements, the excess revolver availability requirement is decreased from $5.0 million to $4.0 million. This Second Amendment gives the Borrowers increased flexibility in accessing borrowings and managing inventory levels. In connection with entering into the Second Amendment, the Borrowers paid an amendment fee of $10,000, as specified in the Second Amendment.
Current report
On August 11, 2026, the Company entered into a Purchase Agreement (the “Purchase Agreement”) with ARC Group International Ltd. (the “Investor”), pursuant to which the Company has the right to sell to the Investor up to $4.5 million of shares of the Company’s common stock subject to the terms and conditions set forth in the Purchase Agreement during a commitment period that will terminate on the earlier of the 36-month anniversary of the Purchase Agreement or the date the Investor has purchased shares equal to the full commitment amount. The purchase price per share will be based on a discount to the volume-weighted average price of the Company’s common stock over specified pricing periods, and sales under the Purchase Agreement are subject to certain limitations as described in the Purchase Agreement. The Company retains full discretion over the timing and amount of any sales under the Purchase Agreement and there is no requirement that the Company sell any shares thereunder. Actual sales of shares of common stock to the Investor from time to time will depend on a variety of factors, including, without limitation, market conditions, the trading price of the common stock
Current report
and determinations by the Company as to the appropriate sources of funding for the Company and its operations. In connection with entering into the Purchase Agreement, the Company will issue to the Investor shares of common stock valued at $200,000 as a commitment fee. The Company intends to use any net proceeds from sales under the Purchase Agreement for working capital and other general corporate purposes. The Purchase Agreement also provides the Company with the option, following the termination of the Purchase Agreement upon either the conclusion of the commitment period or the Investor’s purchase of shares equal to the full commitment amount, to enter into a subsequent purchase agreement with the Investor for up to an additional $5.5 million on substantially the same terms as the Purchase Agreement, provided that no commitment fee would be payable by the Company to the Investor under any such subsequent purchase agreement.
Current report
Comparisons for the Twenty-Six Weeks ended June 28, 2026 and June 29, 2025
Current report
Net Revenue
Current report
Cost of Revenue
Current report
Gross Profit
Current report
Gross profit decreased in the twenty-six weeks ended June 28, 2026 by $3.9 million, or 6% compared to the same period of the prior year even though revenues declined by 14%, reflecting the improvement in gross margins to 47.0% versus 43.1% in the prior year from a mix shift to higher margin products combined with freight cost savings due to improved shipping rates.
Current report
Selling and Marketing Expenses
Current report
Selling and marketing expenses, which are correlated to sales, decreased in the twenty-six weeks ended June 28, 2026 by $5.5 million, or 14%, compared to the same period of the prior year, primarily due to lower marketing costs of $5.3 million and merchant processing fees of $0.6 million, offset by $0.5 million of other selling expenses.
Current report
General and Administrative Expenses
Current report
Interest Expense
Current report
Income Tax Benefit (Provision)
Current report
On July 27, 2026, the Company entered into the Second Amendment, which changes the earliest date the Borrowers can include an increased inventory formula into the revolver borrowing base from August 14, 2026 to July 21, 2026 (the “July 2026 Increased Inventory Availability Period”), provides that, on a going-forward basis after giving effect to the July 2026 Increased Inventory Availability Period, the increased inventory formula may be used once before June 30, 2027 and twice after June 30, 2027 through the third anniversary of the revolver closing date, and provides that during the July 2026 Increased Inventory Availability Period only, for purposes of determining increased reporting requirements, the excess revolver availability requirement is decreased from $5.0 million to $4.0 million. This Second Amendment gives the Borrowers increased flexibility in accessing borrowings and managing inventory levels. In connection with entering into the Second Amendment, the Borrowers paid an amendment fee of $10,000, as specified in the Second Amendment.
Current report
receivable due to the receipt of state income tax refunds. These increases were partially offset by a $4.6 million decrease in accounts payable related to the timing of payments, a $3.3 million increase in inventory, and a $2.3 million decrease in operating lease liabilities.
Removed paragraphs (1)
Previous report
from an increase of a $7.9 million in the return reserve, a $6.1 million increase in marketing accruals, a $4.9 million increase in inventory accruals, and a $1.1 million increase in stored value liabilities. These increases were partially offset by a $5.6 million increase in inventory and a $3.4 million increase in assets for recovery and net change in other operating assets and liabilities.
Reworded paragraphs (28)
Previous wording
Our corporate headquarters are located in a leased facility in Chico, California, which lease will terminate on May 31, 2026. In early 2026, the Company entered into a lease agreement for a new facility in Chico, California, which will become our new corporate headquarters, effective May 15, 2026.
Current wording
Effective May 15, 2026, our new corporate headquarters relocated to a leased facility in Chico, California. Our prior corporate headquarters were also located in a different leased facility in Chico, California, and the lease agreement for that facility was terminated on May 31, 2026.
Previous wording
The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The primary sources of funds for our business activities are cash flows from operations and cash available under the Loan and Security Agreement with White Oak Commercial Finance, LLC (the “2025 Credit Agreement”). We believe the cash on hand, cash provided by operations and cash available under 2025 Credit Agreement will enable us to meet our obligations for at least the next 12 months. For further information on the 2025 Credit Agreement, see Note 5,Debt.
Current wording
The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The primary sources of funds for our business activities are cash flows from operations and cash available under the Loan and Security Agreement with White Oak Commercial Finance, LLC, as amended (the “2025 Credit Agreement”). We believe the cash on hand, cash provided by operations and cash available under the 2025 Credit Agreement will enable us to meet our obligations for at least the next 12 months. For further information on the 2025 Credit Agreement, see Note 5,Debt.
Previous wording
information in evaluating our performance and that excluding certain items that may vary substantially in frequency and magnitude period-to-period from net loss provides useful supplemental measures that assist in evaluating our ability to generate earnings and to more readily compare these metrics between past and future periods. These non-GAAP financial measures may be different than similarly titled measures used by other companies.
Current wording
We report our financial results in accordance with generally accepted accounting principles in the U.S. (“GAAP”). However, management believes that certain non-GAAP financial measures provide investors with additional useful information in evaluating our performance and that excluding certain items that may vary substantially in frequency and magnitude period-to-period from net loss provides useful supplemental measures that assist in evaluating our ability to generate earnings and to more readily compare these metrics between past and future periods. These non-GAAP financial measures may be different than similarly titled measures used by other companies.
Previous wording
significantly from period to period, do not directly relate to the ongoing operations of our business and may complicate comparisons of our internal results of operations and results of operations of other companies over time. In addition, Adjusted EBITDA includes adjustments for other items that we do not expect to regularly record. Each of the normal recurring adjustments and other adjustments described in this paragraph and in the following reconciliation table help management with a measure of our core operating performance over time by removing items that are not related to day-to-day operations. Adjusted EBITDA Margin is a non-GAAP financial measure that we calculate as Adjusted EBITDA (as defined above) as a percentage of our net revenue.
Current wording
Due to these limitations, Adjusted EBITDA and Adjusted EBITDA Margin should not be considered as measures of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using these non-GAAP measures only supplementally. As noted in the table below, Adjusted EBITDA includes adjustments to exclude the impact of depreciation and amortization, interest expense, income taxes, equity-based compensation and goodwill impairment. It is reasonable to expect that some of these items will occur in future periods. However, we believe these adjustments are appropriate because the amounts recognized can vary significantly from period to period, do not directly relate to the ongoing operations of our business and may complicate comparisons of our internal results of operations and results of operations of other companies over time. In addition, Adjusted EBITDA includes adjustments for other items that we do not expect to regularly record. Each of the normal recurring adjustments and other adjustments described in this paragraph and in the following reconciliation table help management with a measure of our core operating performance over time by removing items that are not related to day-to-day operations. Adjusted EBITDA Margin is a non-GAAP financial measure that we calculate as Adjusted EBITDA (as defined above) as a percentage of our net revenue.
Previous wording
A reconciliation to non-GAAP Free Cash Flow from net cash provided by operating activities for the thirteen weeks ended March 29, 2026 and March 30, 2025 is as follows:
Current wording
A reconciliation to non-GAAP Free Cash Flow from net cash provided by operating activities for the thirteen and twenty-six weeks ended June 28, 2026 and June 29, 2025 is as follows:
Previous wording
Our continued success depends in part on our ability to retain and drive repeat purchases from our existing customers. We monitor retention across our entire customer base. Our goal is to attract and convert visitors into Active Customers and foster relationships that drive repeat purchases. During the trailing 12 months ended March 29, 2026, we served 2.3 million Active Customers compared to 2.6 million for the trailing 12 months ended March 30, 2025.
Current wording
Our continued success depends in part on our ability to retain and drive repeat purchases from our existing customers. We monitor retention across our entire customer base. Our goal is to attract and convert visitors into Active Customers and foster relationships that drive repeat purchases. During the trailing 12 months ended June 28, 2026, we served 2.2 million Active Customers compared to 2.5 million for the trailing 12 months ended June 29, 2025.
Previous wording
Cost of revenue consists of the product costs of merchandise sold to customers; shipping and handling costs, including all inbound, outbound, and return shipping expenses; rent, insurance, business property tax, utilities, depreciation and amortization, and repairs and maintenance related to our distribution facilities; and charges related to inventory shrinkage, damages, and our allowance for excess or obsolete inventory. Cost of revenue is primarily driven by growth in orders placed by customers, the mix of the product available for sale on our site, and transportation costs related to inventory receipts from our suppliers. We expect our cost of revenue to fluctuate as a percentage of net revenue primarily due to how we manage our inventory and merchandise mix.
Current wording
Cost of revenue consists of the product costs of merchandise sold to customers; shipping and handling costs, including all inbound, outbound, and return shipping expenses; rent, insurance, business property tax, utilities, depreciation and amortization, and repairs and maintenance related to our distribution facilities; and charges related to inventory shrinkage, damages, and our allowance for excess or obsolete inventory. Cost of revenue is primarily driven by the orders placed by customers, the mix of the product available for sale on our site, and transportation costs related to inventory receipts from our suppliers. We expect our cost of revenue to fluctuate as a percentage of net revenue primarily due to how we manage our inventory and merchandise mix.
Previous wording
Net revenue decreased in the thirteen weeks ended March 29, 2026 by $6.6 million, or 10%, compared to the same period of the prior year, primarily due to a 15% decrease in Total Orders Placed partially offset by the impact of higher AOV and an increase in wholesale revenue.
Current wording
Net revenue decreased in the thirteen weeks ended June 28, 2026 by $13.7 million, or 17%, compared to the same period of the prior year, primarily due to a 17% decrease in Total Orders Placed partially offset by the impact of higher AOV and an increase in wholesale revenue.
Previous wording
Cost of revenue decreased in the thirteen weeks ended March 29, 2026 by $6.7 million, or 18% compared to the same period of the prior year, primarily driven by reduced sales volume in addition to freight cost savings due to improved shipping rates.
Current wording
Cost of revenue decreased in the thirteen weeks ended June 28, 2026 by $9.7 million, or 22%, compared to the same period of the prior year, primarily driven by reduced sales volume in addition to freight cost savings due to improved shipping rates.
Previous wording
Gross profit increased slightly in the thirteen weeks ended March 29, 2026 by $0.1 million, or 0.4% compared to the same period of the prior year even though revenues declined by 10%, reflecting the improvement in gross margins to 45%
Current wording
Gross profit decreased in the thirteen weeks ended June 28, 2026 by $4.0 million, or 11%, compared to the same period of the prior year even though revenues declined by 17%, reflecting the improvement in gross margins to 48.6% versus 45.3% in the prior year from a mix shift to higher margin products combined with freight cost savings due to improved shipping rates.
Previous wording
Selling and marketing expenses, which are correlated to sales, decreased in the thirteen weeks ended March 29, 2026 by $1.9 million, or 12%, compared to the same period of the prior year, primarily due to lower online marketing costs of $1.7 million and merchant processing fees of $0.2 million.
Current wording
Selling and marketing expenses, which are correlated to sales, decreased in the thirteen weeks ended June 28,2026 by $3.6 million, or 16%, compared to the same period of the prior year, primarily due to lower marketing costs of $3.3 million and merchant processing fees of $0.4 million.
Previous wording
General and administrative expenses decreased in the thirteen weeks ended March 29, 2026 by $2.6 million or 14%, compared to the same period of the prior year. The decrease was primarily due to a $1.0 million decrease in variable labor and benefits associated with lower sales volume and enhanced productivity realized from our distribution center consolidation efforts, a $0.8 million decrease in equity-based compensation expense, a $0.4 million decrease in fixed labor and benefits costs driven by reduced fixed headcount, and a $0.4 million decrease in other general and administrative expenses.
Current wording
General and administrative expenses decreased in the thirteen weeks ended June 28, 2026 by $1.7 million or 10%, compared to the same period of the prior year. The decrease was primarily due to a $0.8 million decrease in variable labor and benefits associated with lower sales volume, a $0.7 million decrease in equity-based compensation expense, and a $0.6 million decrease in fixed labor and benefits costs driven by reduced fixed headcount, partially offset by a $0.5 million increase in other general and administrative expenses.
Previous wording
Interest expense decreased in the thirteen weeks ended March 29, 2026, by $0.2 million, or 32%, compared to the same period of the prior year. Interest expense in the prior year included $0.2 million in fees related to amendments to our Prior Credit Agreement. Excluding the impact of these non-recurring fees, interest expense increased modestly primarily due to higher average borrowings and higher interest rate.
Current wording
Interest expense decreased in the thirteen weeks ended June 28, 2026, by $0.6 million, or 65%, compared to the same period of the prior year. Interest expense in the prior year included $0.3 million in fees related to amendments to our Prior Credit Agreement. Excluding the impact of these non-recurring fees, interest expense increased modestly primarily due to higher average borrowings and higher interest rate.
Previous wording
Income tax provision in the thirteen weeks ended March 29, 2026 increased by $0.3 million to a provision of $0.2 million, compared to a benefit of $0.1 million in the thirteen weeks ended March 30, 2025. The increase was primarily due to state income taxes and deferred taxes relating to the annual tax amortization expense on certain indefinite-lived intangible assets.
Current wording
Income tax provision in thetwenty-six weeks ended June 28, 2026 increased by $0.2 million to a provision of $0.2 million, compared to a benefit of $12 thousand in thetwenty-six weeks ended June 29, 2025. The increase was primarily due to state income taxes and deferred taxes relating to the annual tax amortization expense on certain indefinite-lived intangible assets.
Previous wording
General and administrative expenses consist primarily of payroll and benefit costs and vary quarter to quarter due to changes in the number of seasonal workers to meet demand based on our seasonality.
Current wording
General and administrative expenses consist primarily of payroll and benefit costs and vary quarter to quarter as we manage distribution center labor to meet the demand based on our seasonality and the changes in the number of short term workers to meet demand based on our seasonality.
Previous wording
On November 15, 2021, we entered into the Prior Credit Agreement with Bank of America (the “lender”) for a revolving facility that provided for borrowings up to $50.0 million with a maturity date of November 15, 2024. The Prior Credit Agreement was amended subsequently by five amendments which modified a number of terms, including extending the maturity date to August 22, 2025, reducing and ultimately prohibiting further borrowings, revising the applicable interest rates, revising or providing limited waivers of compliance with certain financial covenants, and adding covenants related to achieving a refinancing transaction.
Current wording
On November 15, 2021, we entered into a Credit Agreement with Bank of America (the “lender”) for a revolving facility that provided for borrowings up to $50.0 million with a maturity date of November 15, 2024. The Prior Credit Agreement was amended subsequently by five amendments which modified a number of terms, including extending the maturity date to August 22, 2025, reducing and ultimately prohibiting further borrowings, revising the applicable interest rates, revising or providing limited waivers of compliance with certain financial covenants, and adding covenants related to achieving a refinancing transaction. The Prior Credit Agreement was satisfied in full and terminated upon entry into the 2025 Credit Agreement described below.
Previous wording
On August 14, 2025, we entered into the 2025 Credit Agreement for an asset-based revolving credit facility with a $20.0 million commitment, a $5.0 million uncommitted accordion and a $1.0 million sublimit for letters of credit. The amount that the Borrowers may borrow under the 2025 Credit Agreement is based on a borrowing base calculated based on advance rates for various assets serving as collateral for the 2025 Credit Agreement. Borrowings under the 2025 Credit Agreement bear interest at a rate equal to the 30-day SOFR rate plus 3.95%. The 2025 Credit Agreement is secured by a first-priority security interest in and lien upon all tangible and intangible personal property of the Borrowers now owned or acquired in the future. The 2025 Credit Agreement includes covenants that limit the Borrowers’ ability to incur indebtedness, to create liens or other encumbrances, to make certain payments and investments, to engage in transactions with affiliates, to guarantee indebtedness and to sell or otherwise dispose of assets and merge or consolidate with other entities. The 2025 Credit Agreement also includes a financial covenant for minimum excess availability under the 2025 Credit Agreement. It also requires us to maintain lockbox accounts and cash management arrangements under the control of the Administrative Agent, who has full dominion and control over each Collection Account and all Deposit Accounts (except Excluded Accounts). Outstanding borrowings are classified as current liabilities, however, the 2025 Credit Agreement does not mature until August 14, 2028.
Current wording
amount that the Borrowers may borrow under the 2025 Credit Agreement is tied to our borrowing base calculated based on advance rates for various assets serving as collateral for the 2025 Credit Agreement. The 2025 Credit Agreement provides that at two times during each year (counted from the anniversary date of the Credit Agreement), the borrowers may elect to include an increased inventory formula into the borrowing base, giving them access to more loan availability than under the standard borrowing base calculation. As originally executed, the 2025 Credit Agreement provided for an initial increased inventory availability period beginning in November 2025 and ending in February 2026 and permitted the Borrowers to elect up to two additional 60-day periods during each of the second and third 12-month periods following the closing date. Borrowings under the 2025 Credit Agreement bear interest at a rate equal to the 30-day SOFR rate plus 3.95%. The 2025 Credit Agreement is secured by a first-priority security interest in and lien upon all tangible and intangible personal property of the Borrowers now owned or acquired in the future. The 2025 Credit Agreement includes covenants that limit the Borrowers’ ability to incur indebtedness, to create liens or other encumbrances, to make certain payments and investments, to engage in transactions with affiliates, to guarantee indebtedness and to sell or otherwise dispose of assets and merge or consolidate with other entities. The 2025 Credit Agreement also includes a financial covenant of the greater of $4 million or 20% of the total commitment in minimum excess availability under the 2025 Credit Agreement, and additional reporting requirements when excess availability is less than $5 million. It also requires us to maintain lockbox accounts and cash management arrangements under the control of the Administrative Agent, who has full dominion and control over each Collection Account and all Deposit Accounts (except Excluded Accounts). Outstanding borrowings are classified as current liabilities, however, the 2025 Credit Agreement does not mature until August 14, 2028.
Previous wording
As of March 29, 2026, the outstanding borrowing under the 2025 Credit Agreement was $13.3 million in addition to a $0.3 million letter of credit outstanding. After giving effect to the excess availability covenant and the outstanding letter of credit, the unused availability was $2.4 million. During the thirteen weeks ended March 29, 2026, we borrowed $60.7 million and repaid $61.8 million under the 2025 Credit Agreement and borrowings had a weighted average interest rate of 10.1% inclusive of amortization of debt issuance cost.
Current wording
As of June 28, 2026, the outstanding borrowing under the 2025 Credit Agreement was $10.1 million in addition to a $0.3 million letter of credit outstanding. After giving effect to the Second Amendment, the excess availability covenant and the outstanding letter of credit, the unused availability was $1.6 million. During the twenty-six weeks ended June 28, 2026, we borrowed $125.8 million and repaid $130.1 million under the 2025 Credit Agreement and borrowings had a weighted average interest rate of 10.4% inclusive of amortization of debt issuance cost.
Previous wording
As of March 29, 2026, we had cash and cash equivalents of $7.4 million. During the thirteen weeks ended March 29, 2026, we benefited from cost reduction and cash conservation measures, including headcount reductions, reduced inventory purchases, adjustments to marketing spend and other fixed, variable, and capital spend. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The primary sources of funds for our business activities are cash flows from operations and our 2025 Credit Agreement. We believe the cash on hand, cash provided by
Current wording
As of June 28, 2026, we had cash and cash equivalents of $4.1 million. During the thirteen and twenty-six weeks ended June 28, 2026, we benefited from cost reduction and cash conservation measures, including headcount reductions, reduced inventory purchases, adjustments to marketing spend and other fixed, variable, and capital spend. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The primary sources of funds for our business activities are cash flows from operations and our 2025 Credit Agreement. We believe the cash on hand, cash provided by operations and cash available under the 2025 Credit Agreement will enable us to meet our obligations for at
Previous wording
operations and cash available under the 2025 Credit Agreement will enable us to meet our obligations for at least the next 12 months. For further information on the 2025 Credit Agreement, see Note 5,Debt. Actual results of operations will depend on numerous factors, many of which are beyond our control, as further discussed in Part I, Item 1A, “Risk Factors” included in our 2025 10-K.
Current wording
least the next 12 months. For further information on the 2025 Credit Agreement, see Note 5,Debt. Actual results of operations will depend on numerous factors, many of which are beyond our control, as further discussed in Part I, Item 1A, “Risk Factors” included in our 2025 10-K.
Previous wording
On May 8, 2024, we announced that our Board of Directors authorized a stock repurchase program to repurchase up to $2.5 million of our common stock (the “2024 Repurchase Program”). During the thirteen weeks ended March 29, 2026, no shares were repurchased pursuant to the Company’s 2024 Repurchase Program. As of March 29, 2026, there was $1.1 million available under the 2024 Repurchase Program authorization.
Current wording
On May 8, 2024, we announced that our Board of Directors authorized a stock repurchase program to repurchase up to $2.5 million of our common stock (the “2024 Repurchase Program”). During the thirteen and twenty-six weeks ended June 28, 2026, no shares were repurchased pursuant to the Company’s 2024 Repurchase Program. As of June 28, 2026, there was $1.1 million available under the 2024 Repurchase Program authorization.
Previous wording
During the thirteen weeks ended March 29, 2026, net cash provided by operating activities was $6.9 million, which consisted of a net loss of $4.1 million, partially offset by non-cash charges of $3.0 million and a net change of $8.0 million in operating assets and liabilities. The non-cash charges were primarily comprised of $1.1 million of depreciation and amortization, $1.1 million of non-cash lease expense and $0.7 million of equity-based compensation expense. The net change in operating assets and liabilities was primarily driven by $16.7 million increase in accrued expenses and other current liabilities which was mostly from a $10.0 million increase in accrued inventory, a $5.5 million increase in returns reserve, and a $1.2 million increase in freight and marketing accruals. These increases were partially offset by a $4.6 million increase in accounts receivable pertaining to timing-related increase in higher credit card receivables, a $2.2 million increase in assets for recovery, and a $1.9 million net change in other operating assets and liabilities.
Current wording
During the twenty-six weeks ended June 28, 2026, net cash provided by operating activities was $7.5 million, which consisted of a net loss of $5.6 million, partially offset by non-cash charges of $5.8 million and a net change of $7.3 million in operating assets and liabilities. The non-cash charges were primarily comprised of $2.1 million of depreciation and amortization, $2.3 million of non-cash lease expense and $1.3 million of equity-based compensation expense. The net change in operating assets and liabilities was primarily driven by a $9.1 million increase in accounts payable due to timing of payments and purchases and a $3.8 million decrease in inventories primarily due to inventory optimization plan. These increases were partially offset by a $2.4 million decrease in lease liabilities, a $1.6 million decrease in accrued expenses and other current liabilities, a $1.4 million increase in assets for recovery, and a $1.0 million increase in accounts receivable pertaining to timing-related increase in higher credit card receivables.
Previous wording
During the thirteen weeks ended March 30, 2025, net cash provided by operating activities was $8.3 million, which consisted of a net loss of $8.0 million, partially offset by non-cash charges of $4.1 million and a net change of $12.2 million in operating assets and liabilities. The non-cash charges were primarily comprised of $1.5 million of equity-based compensation expense, $1.4 million of depreciation and amortization, and $1.3 million of non-cash lease expense. The net change in operating assets and liabilities was primarily driven by a $21.2 million increase in accrued expenses, mostly
Current wording
During the twenty-six weeks ended June 29, 2025, net cash provided by operating activities was $7.0 million, which consisted of a net loss of $11.0 million, partially offset by non-cash charges of $7.7 million and a net change of $10.3 million in operating assets and liabilities. The non-cash charges were primarily comprised of $2.8 million of equity-based compensation expense, $2.6 million of depreciation and amortization, and $2.3 million of non-cash lease expense. The net change in operating assets and liabilities was primarily driven by a $20.5 million increase in accrued expenses driven by an increase in marketing costs, accrued inventory and returns reserve; and a $3.0 million decrease in income tax
Previous wording
Our primary investing activities have consisted of purchases of equipment to support our overall business growth and internally developed software for the continued development of our proprietary technology infrastructure. Purchases of property and equipment may vary from period to period due to the timing of the expansion or contraction of our operations. We have no material commitments for capital expenditures.
Current wording
Our primary investing activities have consisted of purchases of equipment to support our business operations and internally developed software for the continued development of our proprietary technology infrastructure. Purchases of property and equipment may vary from period to period due to the timing of the expansion or contraction of our operations. We have no material commitments for capital expenditures.
Previous wording
During the thirteen weeks ended March 29, 2026, net cash used in investing activities related to the purchase of capitalized software and property and equipment was $0.4 million, as compared to $0.6 million during the thirteen weeks ended March 30, 2025.
Current wording
During the twenty-six weeks ended June 28, 2026, net cash used in investing activities related to the purchase of capitalized software and property and equipment was $0.8 million, as compared to $1.1 million during the twenty-six weeks ended June 29, 2025.
Previous wording
During the thirteen weeks ended March 29, 2026, cash used in financing activities was $1.7 million, primarily due to $61.8 million of repayments under our 2025 Credit Agreement, and $0.5 million of principal payments on finance lease obligations, partially offset by $60.7 million proceeds from borrowings under our 2025 Credit Agreement.
Current wording
During the twenty-six weeks ended June 28, 2026, cash used in financing activities was $5.2 million, primarily due to $130.1 million of repayments under our 2025 Credit Agreement, $0.6 million of principal payments on finance lease obligations and $0.3 million for withholding tax payments related to vesting of RSUs, partially offset by $125.8 million proceeds from borrowings under our 2025 Credit Agreement.
Previous wording
During the thirteen weeks ended March 30, 2025, cash used in financing activities was $3.6 million, primarily due to $3.0 million of repayments under our Prior Credit Agreement, $0.3 million of principal payments on finance lease obligations and $0.2 million used in the repurchase of our common stock.
Current wording
During the twenty-six weeks ended June 29, 2025, cash used in financing activities was $8.8 million, primarily due to $7.3 million of repayments under our Prior Credit Agreement, $0.7 million used in the repurchase of our common stock, and $0.6 million of principal payments on finance lease obligations.
Previous wording
We are an “emerging growth company,” as defined in the JOBS Act. Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have elected to use this extended transition period until we are no longer an emerging growth company or until we affirmatively and irrevocably opt out of the extended transition period. Accordingly, our consolidated financial statements and our unaudited interim consolidated financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.
Current wording
The Company is an emerging growth company, as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards issued subsequent to the enactment of the JOBS Act until such time as those standards apply to private companies. The Company has elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date that it (i) is no longer an emerging growth company or (ii) affirmatively and irrevocably opts out of the extended transition period provided in the JOBS Act. As a result, these condensed consolidated financial statements may not be comparable to companies that comply with the new or revised accounting pronouncements as of public company effective dates.
Rearranged current paragraphs (6)
Current report — wording carried from elsewhere
Income tax benefit in the thirteen weeks ended June 28, 2026 decreased by $0.1 million to a benefit of $9 thousand, compared to a provision of $0.1 million in the thirteen weeks ended June 29, 2025.
Current report — wording carried from elsewhere
Net revenue decreased in the twenty-six weeks ended June 28, 2026 by $20.3 million, or 14%, compared to the same period of the prior year, primarily due to a 16% decrease in Total Orders Placed partially offset by the impact of higher AOV and an increase in wholesale revenue.
Current report — wording carried from elsewhere
Cost of revenue decreased in the twenty-six weeks ended June 28, 2026 by $16.5 million, or 20% compared to the same period of the prior year, primarily driven by reduced sales volume in addition to freight cost savings due to improved shipping rates.
Current report — wording carried from elsewhere
General and administrative expenses decreased in the twenty-six weeks ended June 28, 2026 by $4.3 million or 12%, compared to the same period of the prior year. The decrease was primarily due to a $1.8 million decrease in variable labor and benefits associated with lower sales volume and productivity enhancements, a $1.4 million decrease in equity-based compensation expense, and a $1.2 million decrease in fixed labor and benefits costs driven by reduced fixed headcount, partially offset by a $0.1 million increase in other general and administrative expenses.
Current report — wording carried from elsewhere
Interest expense decreased in the twenty-six weeks ended June 28, 2026, by $0.7 million, or 51%, compared to the same period of the prior year. Interest expense in the prior year included $0.6 million in fees related to amendments to our Prior Credit Agreement. Excluding the impact of these non-recurring fees, interest expense increased modestly primarily due to higher average borrowings and higher interest rate.
Current report — wording carried from elsewhere
On August 14, 2025, we entered into the 2025 Credit Agreement for an asset-based revolving credit facility with a $20.0 million commitment, a $5.0 million uncommitted accordion and a $1.0 million sublimit for letters of credit. The
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
We report our financial results in accordance with generally accepted accounting principles in the U.S. (“GAAP”). However, management believes that certain non-GAAP financial measures provide investors with additional useful
Previous report — wording carried elsewhere
Due to these limitations, Adjusted EBITDA and Adjusted EBITDA Margin should not be considered as measures of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using these non-GAAP measures only supplementally. As noted in the table below, Adjusted EBITDA includes adjustments to exclude the impact of depreciation and amortization, interest expense, income taxes, equity-based compensation and goodwill impairment. It is reasonable to expect that some of these items will occur in future periods. However, we believe these adjustments are appropriate because the amounts recognized can vary
Previous report — wording carried elsewhere
versus 40% in the prior year from a mix shift to higher margin products combined with freight cost savings due to improved shipping rates.