Zumiez Inc

Previous wording

Fiscal 2025 is the 52-week period ending January 31, 2026. Fiscal 2024 was the 52-week period ending February 1, 2025. The first six months of fiscal 2025 was the 26-week period ended August 2, 2025. The first six months of fiscal 2024 was the 26-week period ended August 3, 2024.

Current wording

Fiscal 2025 is the 52-week period ending January 31, 2026. Fiscal 2024 was the 52-week period ending February 1, 2025. The first nine months of fiscal 2025 was the 39-week period ended November 1, 2025. The first nine months of fiscal 2024 was the 39-week period ended November 2, 2024.

Previous wording

We have been, and we expect to continue to be affected by a number of factors that may cause actual results to differ from our historical results or current expectations. These factors include the impact of foreign currency rates; changes in laws, including U.S. tax law changes; fluctuations in variable costs, and changes in general economic conditions in the markets in which we operate. Additionally, we have experienced increased costs during 2024 and 2025. Our ability to raise our selling prices depends on market conditions and there may be periods during which we are unable to fully recover increases in our costs or experience an adverse impact on demand due to pricing actions. We believe higher consumer price inflation has resulted in reduced consumer confidence and consumer spending which negatively impacted our sales during fiscal 2024 and the first six months of fiscal 2025.

Current wording

We have been, and we expect to continue to be affected by a number of factors that may cause actual results to differ from our historical results or current expectations. These factors include the impact of foreign currency rates; changes in laws, including U.S. tax law changes; fluctuations in variable costs, and changes in general economic conditions in the markets in which we operate. Additionally, we have experienced increased costs during 2024 and 2025. Our ability to raise our selling prices depends on market conditions and there may be periods during which we are unable to fully recover increases in our costs or experience an adverse impact on demand due to pricing actions. We believe higher consumer price inflation has resulted in reduced consumer confidence and consumer spending which negatively impacted our sales during fiscal 2024 and the first nine months of fiscal 2025.

Previous wording

The following table presents selected items on the condensed consolidated statements of loss as a percent of net sales:

Current wording

The following table presents selected items on the condensed consolidated statements of income (loss) as a percent of net sales:

Previous wording

Net sales were $214.3 million for the three months ended August 2, 2025 compared to $210.2 million for the three months ended August 3, 2024, an increase of $4.1 million, or 1.9%. The increase in sales was primarily driven by a 2.5% increase in comparable sales, partially offset by the net closure of 19 stores subsequent to August 3, 2024. By region, North America sales increased $3.8 million or 2.1% and other international sales (which consists of Europe and Australia sales) increased $0.3 million or 1.0% for the three months ended August 2, 2025 compared to the three months ended August 3, 2024. Excluding the impact of changes in foreign exchange rates, North America sales increased $3.8 million or 2.1% and other international sales decreased $1.4 million or 4.2% for the three months ended August 2, 2025 compared to the three months ended August 3, 2024.

Current wording

Net sales were $239.1 million for the three months ended November 1, 2025 compared to $222.5 million for the three months ended November 2, 2024, an increase of $16.6 million, or 7.5%. The increase in sales was primarily driven by a 7.6% increase in comparable sales, partially offset by the net closure of 24 stores subsequent to November 2, 2024. By region, North America sales increased $16.0 million or 8.6% and other international sales (which consists of Europe and Australia sales) increased $0.6 million or 1.7% for the three months ended November 1, 2025 compared to the three months ended November 2, 2024. Excluding the impact of changes in foreign exchange rates, North America sales increased $16.2 million or 8.7% and other international sales decreased $1.1 million or 3.1% for the three months ended November 1, 2025 compared to the three months ended November 2, 2024.

Previous wording

Comparable sales increased 2.5% (reflecting a 4.2% increase in North America and a 5.5% decrease in other international) for the three months ended August 2, 2025, driven by an increase in dollars per transaction partially offset by a decrease in transactions. Dollars per transaction increased due to an increase in average unit retail partially offset by decrease in units per transaction. By category, comparable sales were primarily driven by increases in women's clothing, hardgoods, and accessories, partially offset by decrease in men's clothing and footwear .

Current wording

Comparable sales increased 7.6% (reflecting a 10.0% increase in North America and a 3.9% decrease in other international) for the three months ended November 1, 2025, driven by an increase in dollars per transaction and an increase in transactions. Dollars per transaction increase due to an increase in average unit retail while units per transaction were relatively flat. By category, comparable sales were primarily driven by increases in women's clothing, hardgoods, men's clothing, accessories, partially offset by decrease in footwear.

Previous wording

Gross profit was $76.0 million for the three months ended August 2, 2025 compared to $71.8 million for the three months ended August 3, 2024, an increase of $4.2 million, or 5.9%. As a percent of net sales, gross profit increased 130 basis points for the three months ended August 2, 2025 to 35.5%. The increase was driven by 60 basis points of benefit in store occupancy costs related to both leverage on higher sales and closure of underperforming stores, 60 basis points of improvement in product margin (defined as net sales minus cost of goods sold excluding shrinkage, buying, occupancy, distribution and warehousing costs and freight costs for store merchandise transfers).

Current wording

Gross profit was $89.8 million for the three months ended November 1, 2025 compared to $78.3 million for the three months ended November 2, 2024, an increase of $11.5 million, or 14.7%. As a percent of net sales, gross profit increased 240 basis points for the three months ended November 1, 2025 to 37.6%. The increase was driven by 110 basis points of leverage in store occupancy costs related to both higher sales and closure of underperforming stores, 100 basis points of improvement in product margin (defined as net sales minus cost of goods sold excluding shrinkage, buying, occupancy, distribution and warehousing costs and freight costs for store merchandise transfers), and 30 basis points of benefit from decreased inventory shrinkage.

Previous wording

Selling, general and administrative (“SG&A”) expense was $75.9 million for the three months ended August 2, 2025 compared to $72.2 million for the three months ended August 3, 2024, an increase of $3.7 million, or 5.2%. SG&A expenses as a percent of net sales increased 100 basis points for the three months ended August 2, 2025 to 35.4%. The increase was driven by a 40 basis point increase in corporate costs, a 30 basis point increase due to a higher than anticipated litigation settlement, 20 basis point increase in annual incentive compensation, a 20 basis point increase in store wages, a 20 basis point increase in non-store wages, and a 30 basis point increase related to numerous smaller changes to impairment costs, training and other corporate costs partially offset by a 60 basis point decrease in store costs not tied to wages.

Current wording

Selling, general and administrative expense was $78.0 million for the three months ended November 1, 2025 compared to $75.9 million for the three months ended November 2, 2024, an increase of $2.1 million, or 2.7%. SG&A expenses as a percent of net sales decreased 140 basis points for the three months ended November 1, 2025 to 32.7%. The decrease was driven by 110 basis points in non-wage store operating costs related to closure of stores year over year, 80 basis points of efficiencies in store wages due to higher sales and closure of low performing stores at the end of fiscal 2024, partially offset by a 40 basis point increase in annual incentive compensation.

Previous wording

Net loss for the three months ended August 2, 2025 was $1.0 million, or $0.06 loss per diluted share, compared with net loss of $0.8 million, or $0.04 loss per diluted share, for the three months ended August 3, 2024. Our effective income tax rate for the three months ended August 2, 2025 was a 210.0% provision for income taxes compared to a 252.5% provision for income taxes for the three months ended August 3, 2024. The decrease in effective income tax rate was primarily due to the allocation of losses across the jurisdictions that we operate.

Current wording

Net income for the three months ended November 1, 2025 was $9.2 million, or $0.55 earnings per diluted share, compared with net income of $1.2 million, or $0.06 earnings per diluted share, for the three months ended November 2, 2024. These results were inclusive of one time discrete tax items recognized in the quarter that increased diluted earnings per share by approximately $0.09. Our effective income tax rate for the three months ended November 1, 2025 was a 26.1% provision for income taxes compared to a 63.4% provision for income taxes for the three months ended November 2, 2024. The decrease in effective income tax rate was primarily driven by improved operating results, the allocation of losses across the jurisdictions that we operate, as well as one time discrete tax items.

Previous wording

Six Months (26 weeks) Ended August 2, 2025 Compared With Six Months (26 weeks) Ended August 3, 2024

Current wording

Nine Months (39 weeks) Ended November 1, 2025 Compared With Nine Months (39 weeks) Ended November 2, 2024

Previous wording

Net sales were $398.6 million for the six months ended August 2, 2025, compared to $387.6 million for the six months ended August 3, 2024, an increase of $11.1 million, or 2.9%. The increase in sales was primarily driven by a 3.9% increase in comparable sales, partially offset by the net closure of 19 stores subsequent to August 3, 2024. By region, North America sales increased $10.8 million or 3.3% and other international sales (which consists of Europe and Australia sales) increased $0.3 million or 0.4% and for the six months ended August 2, 2025, compared to the six months ended August 3, 2024. Excluding the impact of changes in foreign exchange rates, North America sales increased $11.2 million or 3.5% and other international sales decreased $1.4 million or 2.1% for the six months ended August 2, 2025 compared to the six months ended August 3, 2024.

Current wording

Net sales were $637.7 million for the nine months ended November 1, 2025, compared to $610.0 million for the nine months ended November 2, 2024, an increase of $27.7 million, or 4.5%. The increase in sales was primarily driven by a 5.3% increase in comparable sales, partially offset by the net closure of 24 stores subsequent to November 2, 2024. By region, North America sales increased $26.8 million or 5.0% and other international sales (which consists of Europe and Australia sales) increased $0.9 million or 0.8% and for the nine months ended November 1, 2025, compared to the nine months ended November 2, 2024. Excluding the impact of changes in foreign exchange rates, North America sales increased $27.5 million or 5.4% and other international sales decreased $2.5 million or 2.4% for the nine months ended November 1, 2025 compared to the nine months ended November 2, 2024.

Previous wording

Comparable sales increased 3.9% (reflecting a 5.6% increase in North America and a 3.9% decrease in other international) for the six months ended August 2, 2025, driven by an increase in dollars per transaction that was offset by a decrease in transactions. Dollars per transaction increased due to an increase in average unit retail partially offset by decrease in units per transaction. By category, comparable sales were primarily driven by an increase in women's clothing, men's clothing, accessories and hardgoods, partially offset by a decrease in footwear.

Current wording

Comparable sales increased 5.3% (reflecting a 7.2% increase in North America and a 3.9% decrease in other international) for the nine months ended November 1, 2025, driven by an increase in dollars per transaction that was offset by a decrease in transactions. Dollars per transaction increased due to an increase in average unit retail partially offset by a decrease in units per transaction. By category, comparable sales were primarily driven by an increase in women's clothing, men's clothing, hardgoods, and accessories partially offset by a decrease in footwear.

Previous wording

Gross profit was $131.3 million for the six months ended August 2, 2025, compared to $123.7 million for the six months ended August 3, 2024, an increase of $7.6 million, or 6.2%. As a percent of net sales, gross profit increased 100 basis points for the six months ended August 2, 2025, to 32.9%. The increase was primarily driven by a 60 basis point benefit in store occupancy costs related to both leverage on higher sales and closure of underperforming stores, a 30 basis point improvement in product margin and 10 basis point benefit related to distribution center and logistics costs tied to higher sales.

Current wording

Gross profit was $221.1 million for the nine months ended November 1, 2025, compared to $202.0 million for the nine months ended November 2, 2024, an increase of $19.1 million, or 9.5%. As a percent of net sales, gross profit increased 160 basis points for the nine months ended November 1, 2025, to 34.7%. The increase was primarily driven by 80 basis points of leverage in store occupancy costs related to both higher sales and closure of underperforming stores, a 60 basis point improvement in product margin and 20 basis point benefit related to distribution center and logistics costs tied to higher sales.

Previous wording

Selling, general and administrative expenses were $151.1 million for the six months ended August 2, 2025, compared to $144.2 million for the six months ended August 3, 2024, an increase of $6.9 million, or 4.8%. SG&A expenses as a percent of net sales increased 70 basis points for the six months ended August 2, 2025, to 37.9%. The increase was primarily driven by a 90 basis point increase due to $3.6 million of litigation settlements, 30 basis points related to numerous smaller increases to annual incentive compensation, impairment costs and corporate costs partially offset by a 60 basis point benefit in store costs not tied to wages.

Current wording

Selling, general and administrative expenses were $229.1 million for the nine months ended November 1, 2025, compared to $220.2 million for the nine months ended November 2, 2024, an increase of $8.9 million, or 4.1%. SG&A expenses as a percent of net sales decreased 10 basis points for the nine months ended November 1, 2025, to 36.0%. The decrease was primarily driven by 80 basis points in non-wage store operating costs related to closure of store year over year, and 30 basis points of efficiencies in store wages due to higher sales and closure of low performing stores at the end of fiscal 2024, partially offset by a 60 basis point increase due to $3.6 million of litigation settlements, a 20 basis point increase in annual incentive compensation due to improved operating results, and a 10 basis point increase in other corporate costs.

Previous wording

Net loss for the six months ended August 2, 2025, was $15.3 million, or $0.88 loss per diluted share, compared with net loss of $17.6 million, or $0.91 loss per diluted share, for the six months ended August 3, 2024. Our effective income tax rate for the six months ended August 2, 2025, was a 3.2% provision for income taxes compared to 7.4% benefit from income taxes for the six months ended August 3, 2024. The increase in effective income tax rate was primarily due to the allocation of losses across the jurisdictions that we operate.

Current wording

Net loss for the nine months ended November 1, 2025, was $6.2 million, or $0.36 loss per diluted share, compared with net loss of $16.5 million, or $0.86 loss per diluted share, for the nine months ended November 2, 2024. These results were inclusive of one time discrete tax items recognized in the year that increased diluted earnings per share by approximately $0.09. Our effective income tax rate for the nine months ended November 1, 2025, was a -149.6% provision for income taxes compared to -3.7% provision for income taxes for the nine months ended November 2, 2024. The decrease in effective income tax rate was primarily driven by improved operating results, the allocation of losses across the jurisdictions that we operate, as well as one time discrete tax items.

Previous wording

Our capital requirements include construction and fixture costs related to the opening of new stores and remodel and relocation expenditures for existing stores. Future capital requirements will depend on many factors, including the pace of new store openings, the availability of suitable locations for new stores and the nature of arrangements negotiated with landlords. Our net investment to open a new store has varied significantly in the past due to a number of factors, including the geographic location and size of the new store, and is likely to vary significantly in the future.

Current wording

Our capital requirements include construction and fixture costs related to the opening of new stores, remodel and relocation expenditures for existing stores. Future capital requirements will depend on many factors, including the pace of new store openings, the availability of suitable locations for new stores and the nature of arrangements negotiated with landlords. Our net investment to open a new store has varied significantly in the past due to a number of factors, including the geographic location and size of the new store, and is likely to vary significantly in the future.

Previous wording

During fiscal 2025, we expect to spend approximately $11.0 million to $13.0 million on capital expenditures, a majority of which will relate to leasehold improvements and fixtures for the approximately 6 new stores we are planning to open in fiscal 2025 and remodels or relocations of existing stores. There can be no assurance that the number of stores that we actually open in fiscal 2025 will not be different from the number of stores we plan to open, or that actual fiscal 2025 capital expenditures will not differ from our expectations.

Current wording

During fiscal 2025, we expect to spend approximately $10.0 million to $12.0 million on capital expenditures, a majority of which will relate to leasehold improvements and fixtures for the approximately 6 new stores we are planning to open in fiscal 2025 and remodels or relocations of existing stores. There can be no assurance that the number of stores that we actually open in fiscal 2025 will not be different from the number of stores we plan to open, or that actual fiscal 2025 capital expenditures will not differ from our expectations.

Previous wording

Net cash used in operating activities decreased by $5.9 million to $9.5 million used in operating activities for the six months ended August 2, 2025 from $15.4 million used in operating activities for the six months ended August 3, 2024. Net cash used in operating activities was $9.5 million for the six months ended August 2, 2025 related to $39.9 million in unfavorable changes in our operating assets and liabilities and a $15.3 million net loss, excluding $45.7 million of noncash charges included within net loss for the period. Net cash used in operating activities was $15.4 million for the six months ended August 3, 2024 related to $44.0 million in unfavorable changes in our operating assets and liabilities and a $17.6 million net loss, excluding $46.2 million of noncash charges included within net loss for the period. Our operating cash flows primarily result from cash received from our customers, offset by cash payments we make for inventory, employee compensation, store occupancy expenses and other operational expenditures. Cash received from our customers generally corresponds to our net sales. Because our customers primarily use credit cards or cash to buy from us, our receivables from customers settle quickly. Historically, changes to our operating cash flows have been driven primarily by changes in operating income, which is impacted by changes to non-cash items such as depreciation, amortization and accretion, deferred taxes, and changes to the components of working capital.

Current wording

Net cash used in operating activities decreased by $29.8 million to $4.2 million used in operating activities for the nine months ended November 1, 2025 from $34.0 million used in operating activities for the nine months ended November 2, 2024. Net cash used in operating activities was $4.2 million for the nine months ended November 1, 2025 related to $70.0 million in unfavorable changes in our operating assets and liabilities and a $6.2 million net loss, excluding $72.0 million of noncash charges included within net loss for the period. Net cash used in operating activities was $34.0 million for the nine months ended November 2, 2024 related to $89.2 million in unfavorable changes in our operating assets and liabilities and a $16.5 million net loss, excluding $71.6 million of noncash charges included within net loss for the period. Our operating cash flows primarily result from cash received from our customers, offset by cash payments we make for inventory, employee compensation, store occupancy expenses and other operational expenditures. Cash received from our customers generally corresponds to our net sales. Because our customers primarily use credit cards or cash to buy from us, our receivables from customers settle quickly. Historically, changes to our operating cash flows have been driven primarily by changes in operating income, which is impacted by changes to non-cash items such as depreciation, amortization and accretion, deferred taxes, and changes to the components of working capital.

Previous wording

Net cash provided by investing activities was $3.5 million for the six months ended August 2, 2025 related to $8.8 million in sales, net of purchases, of marketable securities, and $5.3 million of capital expenditures primarily for new store openings, and relocations. Net cash provided by investing activities was $15.9 million for the six months ended August 3, 2024, related to $22.2 million in sales, net of purchases, of marketable securities, partially offset by $6.3 million of capital expenditures primarily for new store openings, existing store remodels or relocation.

Current wording

Net cash provided by investing activities was $5.1 million for the nine months ended November 1, 2025 related to $12.6 million in sales, net of purchases, of marketable securities, partially offset by $7.5 million of capital expenditures primarily for new store openings, remodels, and relocations. Net cash provided by investing activities was $22.1 million for the nine months ended November 2, 2024, related to $32.1 million in sales, net of purchases, of marketable securities, partially offset by $10.0 million of capital expenditures primarily for new store openings, existing store remodels or relocation.

Previous wording

Net cash used in financing activities for the six months ended August 2, 2025 was $32.5 million, related$32.7 million used in the repurchase of common stock and $0.2 million in payments for tax withholding obligations upon vesting of restricted stock partially offset by $0.4 million in proceeds from the issuance and exercise of stock-based awards. Net cash used in financing activities for the six months ended August 3, 2024 was $19.4 million, related$19.6 million used in the repurchase of common stock and $0.2 million in payments for tax withholding obligations upon vesting of restricted stock partially offset by $0.4 million in proceeds from the issuance and exercise of stock-based awards.

Current wording

Net cash used in financing activities for the nine months ended November 1, 2025 was $37.7 million, related$38.2 million used in the repurchase of common stock and $0.2 million in payments for tax withholding obligations upon vesting of restricted stock partially offset by $0.7 million in proceeds from the issuance and exercise of stock-based awards. Net cash used in financing activities for the nine months ended November 2, 2024 was $24.6 million, related$25.2 million used in the repurchase of common stock and $0.1 million in payments for tax withholding obligations upon vesting of restricted stock partially offset by $0.7 million in proceeds from the issuance and exercise of stock-based awards.

Previous wording

The new Credit Facility is secured by cash and marketable securities that are in an account held and monitored by the Bank. The value of this collateral must always be greater than or equal to the new Credit Facility commitment amount of $25 million. Amounts borrowed under the new Credit Facility bear interest at the rate of SOFR plus 1.00% per annum. The Credit Agreement does not provide for any financial covenants but does include standard and customary covenants consistent with credit facilities of this nature. The new Credit Facility does not carry any ongoing or unused balance fees. The Credit Facility will mature on December 20, 2025.

Current wording

The new Credit Facility is secured by cash and marketable securities that are in an account held and monitored by the Bank. The value of this collateral must always be greater than or equal to the new Credit Facility commitment amount of $25 million. Amounts borrowed under the new Credit Facility bear interest at the rate of SOFR plus 1.00% per annum. The Credit Agreement does not provide for any financial covenants but does include standard and customary covenants consistent with credit facilities of this nature. The new Credit Facility does not carry any ongoing or unused balance fees. The Credit Facility will mature on December 20, 2025. We are currently discussing the renewal of the credit facility prior to its expiration.

Previous wording

We had open commercial letters of credit outstanding of less than $0.2 million at August 2, 2025, and no open commercial letters of credit outstanding at February 1, 2025. We had $3.2 million, and $2.7 million in issued, but undrawn, standby letters of credit backed by restricted cash deposits and marketable securities at the bank as of August 2, 2025 and February 1, 2025 respectively.

Current wording

There were no borrowings or open commercial letters of credit outstanding under the secured credit facility at November 1, 2025 or February 1, 2025. We had $3.2 million, and $2.7 million in issued, but undrawn, standby letters of credit backed by restricted cash deposits and marketable securities at the bank as of November 1, 2025 and February 1, 2025, respectively.