J.Jill, Inc.

1. Description of Business

J.Jill, Inc., (“J.Jill” or the “Company”), is a national lifestyle brand that provides apparel, footwear and accessories designed to help its customers move through a full life with ease. The brand represents an easy, thoughtful and inspired style that celebrates the totality of all women and designs its products with its core brand ethos in mind: keep it simple and make it matter. J.Jill offers a high touch customer experience through 255 stores nationwide and a robust ecommerce platform. J.Jill is headquartered outside Boston, Massachusetts.

J.Jill, Inc. is a holding company. Jill Acquisition LLC, its wholly-owned subsidiary, and J.Jill Gift Card Solutions, Inc., a wholly-owned subsidiary of Jill Acquisition LLC, are the operating companies for the business assets.

2. Summary of Significant Accounting Policies

Basis of Presentation

Our interim condensed consolidated financial statements are unaudited. All significant intercompany balances and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted, in accordance with the rules of the Securities and Exchange Commission (the “SEC”) associated with reporting of interim period financial information. We consistently applied the accounting policies described in our Annual Report on Form 10-K (the “2025 Annual Report”) for the fiscal year ended January 31, 2026 (“Fiscal Year 2025”) in preparing these unaudited interim condensed consolidated financial statements. J.Jill operates on a 52- or 53-week fiscal year that ends on the Saturday that is closest to January 31. Each fiscal year generally is comprised of four 13-week fiscal quarters, although in the years with 53 weeks, the fourth quarter represents a 14-week period. The fiscal year ending January 30, 2027 (“Fiscal Year 2026”) and Fiscal Year 2025 are both comprised of 52 weeks.

In the opinion of management, these interim condensed consolidated financial statements contain all normal and recurring adjustments necessary to state fairly the financial position and results of operations of the Company. The consolidated balance sheet as of January 31, 2026 was derived from the audited consolidated balance sheet as of that date. The unaudited results of operations for the thirteen and twenty-six weeks ended August 1, 2026 are not necessarily indicative of future results or results to be expected for Fiscal Year 2026. You should read these statements in conjunction with our audited consolidated financial statements and related notes in our 2025 Annual Report.

Restricted Cash

The Company's restricted cash balance represents an imprest cash account used to fund employee healthcare costs. The balance of restricted cash as of August 1, 2026 and August 2, 2025 was $0.4 million, which is included in Prepaid expenses and other current assets on the condensed consolidated balance sheets.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statement of cash flows (in thousands):

Accounts Receivable

The beginning balances at January 31, 2026 for accounts receivable arising from contracts with customers was $4.3 million with ending balances included in accounts receivable on the condensed consolidated balance sheets.

The beginning balances at February 1, 2025 for accounts receivable arising from contracts with customers was $5.0 million with ending balances included in accounts receivable on the condensed consolidated balance sheets.

The Company’s accounts receivable relates primarily to payments due from banks for credit and debit card transactions for approximately 2 to 5 daysof sales. These receivables do not bear interest. The Company occasionally sells inventory to liquidators, and ifthese sales occur near the end of a reporting period, they are also included in Accounts receivable on the condensed consolidated balance sheets.

Cost of Goods Sold

Cost of goods sold (“COGS”) consists of the direct costs of sold merchandise, which include customs, taxes, tariffs, duties, commissions and inbound shipping costs, inventory shrinkage, and adjustments and reserves for excess, aged and obsolete inventory. COGS does not include distribution center costs and allocations of indirect costs, such as occupancy, depreciation, amortization, or labor and benefits.

Selling, general and administrative expenses consist primarily of payroll and related expenses, occupancy costs, information systems costs and other operating expenses related to our stores and operations at the headquarters, including utilities, depreciation and amortization. These expenses also consist of marketing expense, including catalog production and mailing costs, warehousing, distribution and outbound shipping costs, customer service operations, consulting and software services, natural disasters, professional services and other administrative costs.

Cloud-Based Software Arrangements

The costs incurred to implement cloud computing arrangements hosted by third party vendors are capitalized when incurred during the application development phase, and recognized as Prepaid expenses and other current assets for the current portion or Other assets for the long-term portion in the condensed consolidated balance sheets. Implementation costs are subsequently amortized on a straight-line basis over the expected term of the related cloud service, beginning on the date the related software or module is ready for its intended use. The amortization of cloud-based software implementation costs is recorded as a component of Selling, general, and administrative expenses, in the condensed consolidated statement of operations and comprehensive income, the same line item as the expense for the associated hosting arrangement. The carrying value of cloud computing implementation costs are tested for impairment when an event or circumstance indicates that the asset might be impaired. Cloud computing arrangement implementation costs are classified within operating activities in the condensed consolidated statements of cash flows.

For the thirteen and twenty-six weeks ended August 1, 2026, the Company amortized $0.6 million and$1.2 million, respectively, of cloud-based software implementation costs. For the thirteen and twenty-six weeks ended August 2, 2025, the Company amortized $0.7 million and $1.1 million, respectively, of cloud-based software implementation costs.

As of August 1, 2026, the Company had$11.3 million of gross capitalized cloud-based software implementation costs and$1.2 millionof related accumulated amortization, for a net balance of $10.1 million, made up of$2.7 million recorded within Prepaid expenses and other current assets and$7.4 million recorded within Other assets in the Company’s condensed consolidated balance sheets.

As of January 31, 2026, the Company had $11.3 million of gross capitalized cloud-based software implementation costs and $2.2 million of related accumulated amortization, for a net balance of $9.1 million, made up of $2.6 million recorded within Prepaid expenses and other current assets and $6.5 million recorded within Other assets in the Company’s condensed consolidated balance sheets.

Change in Accounting Estimate

Effective in the first quarter of 2025, the Company revised its methodology for estimating the Direct sales returns reserve. Previously, the reserve was calculated based on catalog offer code tracking data. After upgrading its Order Management System (“OMS”) in March 2025, the Company transitioned to a curve-based model that aligns with the methodology used to estimate returns for its Retail channel. The new model is expected to provide a more accurate reflection of customer return behavior.

Additionally, in the first quarter of 2025, the Company reduced the allowable return window for Direct and Retail sales from 90 to 60 days, which also impacted the estimate of expected returns. The Company further revised its methodology for estimating the Retail sales returns reserve in the third quarter of 2025. The Company no longer includes an exchange assumption to better align the reserve with the data provided under its new OMS. These changes have been accounted for as changes in accounting estimates and applied prospectively in accordance with applicable accounting guidance. The impact of these changes is not material to the consolidated financial statements.

Recently Issued Accounting Pronouncements

In December 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) No. 2025-12, Codification Improvements. This update makes technical corrections and clarifications to the Codification, including conforming amendments and editorial changes. The amendments are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods with early adoption permitted. The adoption of this guidance is not expected to have a material impact on the Company’s consolidated financial statements or disclosures.

In December 2025, the FASB also issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This update clarifies certain interim reporting requirements and is intended to reduce diversity in practice. The amendments relate primarily to the presentation and disclosure of interim financial information. The amendments are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its interim financial reporting.

In September 2025, the FASB issued ASU No. 2025-06, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software.” This ASU modernizes the capitalization criteria for internal-use software by eliminating references to project-stage phases and clarifying when capitalization should begin. The guidance is effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40).” Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. These standards provide guidance to expand disclosures related to the disaggregation of income statement expenses. The standard requires, in the notes to the financial statements, disclosure of specified information about certain costs and expenses which includes purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each relevant expense caption. This guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, on a retrospective or prospective basis, with early adoption permitted. The Company is currently evaluating the impact that this guidance will have on its disclosures in the Company’s consolidated financial statements.

In October 2023, the FASB issued ASU 2023-06, “Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative”. This ASU amends the FASB Accounting Standards Codification (“ASC”) in response to the SEC’s disclosure update and simplification initiative. This guidance will be applied prospectively with the effective date for each amendment to be the date on which the SEC’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. If by June 30, 2027, the SEC has not removed the related disclosures from Regulation S-X or Regulation S-K, the pending amendments will not become effective for any entity. The Company is assessing what impact this guidance will have on its disclosures in the Company’s consolidated financial statements.

Recently Adopted Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, “Improvements to Income Tax Disclosures.” This ASU requires enhanced income tax disclosures, including disaggregation of information in the rate reconciliation table and disaggregated information related to income taxes paid. The other amendments in this update improve the effectiveness and comparability of disclosures by (1) adding disclosures of pretax income (or loss) and income tax expense (or benefit), and (2) removing disclosures that are no longer considered cost beneficial or relevant. The Company adopted this ASU during the fourth quarter of Fiscal Year 2025 and updated its disclosures accordingly.

3. Revenues

Disaggregation of Revenue

Net sales consist primarily of revenues, net of merchandise returns and discounts, generated from the sale of apparel and accessory merchandise through our retail stores (“Retail”) and through our website and catalog orders (“Direct”). Net sales also include shipping and handling fees collected from customers, royalty revenues and marketing reimbursements related to our private label credit card agreement. Retail revenue is recognized at the time of sale or upon shipment if the sale is not immediately fulfilled, and Direct revenue is recognized upon shipment of merchandise to the customer. The following table presents disaggregated revenues by source (in thousands):

Remaining Performance Obligations

As of August 1, 2026, the transaction price allocated to remaining performance obligations amounts to$0.4 million, which relates to the marketing and promotion of the Company’s private label credit card program. This amount will be recognized as revenue evenly through January 2031.

Contract Liabilities

The Company recognizes a contract liability when it has received consideration from the customer and has a future obligation to the customer. Total contract liabilities consisted of the following (in thousands):

(1)

The current and noncurrent portions of the upfront payment received in connection with the private label credit card agreement are included in Accrued expenses and other current liabilities and Other long-term liabilities, respectively, in the Company’s condensed consolidated balance sheets.

(2)

The unredeemed gift cards balance is included in Accrued expenses and other current liabilities in the Company’s condensed consolidated balance sheets. Revenue recognized for the twenty-six weeks ended August 1, 2026 and August 2, 2025 related to the contract liability balance at the beginning of each fiscal year was$2,968 and $3,026.

The Company recognized revenue related to gift card redemptions and breakage for the thirteen and twenty-six weeks ended August 1, 2026 of approximately $3.0 million and$6.5 million, respectively, and for the thirteen and twenty-six weeks ended August 2, 2025 of approximately$3.0 million and$6.2 million, respectively. Revenue recognized consists of gift cards that were part of the unredeemed gift card balance at the beginning of the period as well as gift cards that were issued and redeemed during the period.

Practical Expedients and Policy Elections

The Company excludes from its revenue all amounts collected from customers for sales taxes that are remitted to taxing authorities.

Shipping and handling activities that occur after control of related goods transfers to the customer are accounted for as fulfillment activities rather than assessing these activities as performance obligations.

The Company does not disclose the transaction price allocated to remaining performance obligations for contracts with customers that have an expected duration of one year or less. The Company applies the optional exemption to not disclose the transaction price allocated to remaining performance obligations where revenue represents sales-or-usage-based royalty. This optional exemption applies to royalty payments received from allowing a third party to use the J.Jill brand in providing a private label credit card to its customers through January 31, 2031. These royalties are based on an agreed-upon percentage of sales generated through the use of the private label credit card.

4. Asset Impairments

Long-lived Asset Impairments

For the thirteen weeks ended August 1, 2026, the Company recordedan $0.1 millionof noncash impairment charges related to leasehold improvements at certain store locations. For the twenty-six weeks ended August 1, 2026, the Company recorded$0.3 million of noncash impairment charges related to leasehold improvements at certain store locations driven by the actual performance at these locations. The Company reduced the net carrying value of certain long-lived assets to their estimated fair value, which was determined using a discounted cash flow method.

For the thirteen weeks ended August 2, 2025, the Company recorded an immaterial amount of noncash impairment charges related to leasehold improvements at certain store locations. For the twenty-six weeks ended August 2, 2025, the Company recorded noncash impairment charges of $0.2 million primarily related to leasehold improvements at certain store locations driven by the actual performance at these locations.

Goodwill and Other Intangible Assets

The balance of goodwill was$59.7 million at August 1, 2026 and January 31, 2026. The accumulated goodwill impairment losses as of August 1, 2026 and February 1, 2025 were$137.3 million.

A summary of other intangible assets as of August 1, 2026 and January 31, 2026 is as follows (in thousands):

Total amortization expense for these amortizable intangible assets was $1.1 million and $1.2 million for the thirteen weeks ended August 1, 2026 and August 2, 2025, respectively, and $2.3 million for the twenty-six weeks ended August 1, 2026 and August 2, 2025, respectively.

The estimated amortization expense for each of the next five years and thereafter is as follows (in thousands):

(1)

Represents amortization expense for the remainder of Fiscal Year 2026.

Impairment Tests

Goodwill and indefinite-lived intangible assets are not amortized but are reviewed for impairment at least annually, or more frequently when events or changes in circumstances indicate that the carrying value may not be recoverable. Definite-lived intangible assets are reviewed for impairment when events or circumstances indicate that the carrying value may not be recoverable. Judgments regarding indicators of potential impairment are based on market conditions and operational performance of the business.

During the thirteen and twenty-six weeks ended August 1, 2026 and August 2, 2025, the Company did not identify any events or circumstances that indicated the fair value of a reporting unit was less than its carrying value.

5. Debt

The components of the Company’s outstanding long-term debt as of August 1, 2026 and January 31, 2026 were as follows (in thousands):

Term Loan Credit Agreement

On December 12, 2025, the Company and Jill Acquisition LLC (the “Borrower”) entered into a new Term Loan Credit Agreement (the “2025 Term Loan Credit Agreement”), with the lenders party thereto from time to time and CCP Agency, LLC, as administrative agent and as collateral agent. The 2025 Term Loan Credit Agreement provides for a senior secured term loan facility in an aggregate principal amount of $75.0 million with a maturity date of December 12, 2030 (the “2025 Term Loan Facility”). As of August 1, 2026 the outstanding principal balance under the 2025 Term Loan Credit Agree ment was $74.1 million.

The proceeds from the 2025 Term Loan Facility were used to pay off in full all outstanding principal balance under the Term Loan Credit Agreement dated as of April 5, 2023 (the “2023 Term Loan Credit Agreement”). All security interests and liens granted in connection with the 2023 Term Loan Credit Agreement were released.

A portion of the transaction was accounted for as a debt modification. As a result, approx imately $1.0 million of deferred costs will continue to be deferred and amortized using the effective interest method through December 12, 2030, the maturity date of the 2025 Term Loan Credit Agreement. These fees are presented as a direct reduction from the carrying amount of long-term debt on the condensed consolidated balance sheets.

Loans under the 2025 Term Loan Credit Agreement bear an upfront fee of 1.00% and interest at the Borrower’s election at (1) the Base Rate (as defined in the 2025 Term Loan Credit Agreement) plus 4.50% through August 1, 2026 and 4.25% thereafter or (2) Term SOFR (as defined in the 2025 Term Loan Credit Agreement) plus 5.50% through August 1, 2026 and 5.25% thereafter, subject to a floor rate of 1.00%.

The 2025 Term Loan Facility is to be repaid in quarterly payments of approxima tely $0.5 million on the last business day of each fiscal quarter of the borrower, commencing with the fiscal quarter ended May 2, 2026, until January 30, 2027 and of approxi mately $0.2 million commencing on the fiscal quarter ending May 1, 2027 and each fiscal quarter thereafter, with the remaining aggregate principal amount of Initial Term Loans (as defined in the 2025 Term Loan Credit Agreement) then outstanding to be paid on maturity on December 12, 2030. Additionally, the 2025 Term Loan Facility is subject to mandatory repayment, subject to certain exceptions, including (i)100% of the net proceeds of any issuance or incurrence of indebtedness other than debt permitted in the 2025 Term Loan Credit Agreement, (ii)100% of the net cash proceeds of certain asset sales/insurance proceeds, subject to reinvestment rights and certain other exceptions, and (iii) an annual payment ranging from 25%-75%, based on the First Lien Net Leverage Ratio, of the annual Excess Cash Flow, less certain voluntary prepayments made during the year, as defined in the 2025 Term Loan Credit Agreement.

The 2025 Term Loan Facility may be voluntarily prepaid after the one-year anniversary without premium or penalty but on or prior to the one-year anniversary, subject to a premium of 1.0% of the aggregate principal amount being prepaid.

The obligations under the 2025 Term Loan Credit Agreement were guaranteed by the Company and J.Jill Gift Card Solutions, Inc., and were secured by substantially all of the real and personal property of the Borrower and the guarantors, subject to customary exceptions. The agreement included customary representations and warranties, affirmative and negative covenants, financial covenants, and events of default.

During Fiscal Year 2025, in conjunction with entering into the 2025 Term Loan Credit Agreement, the Company incurred $0.3 million of third-party fees which were expensed as incurred.

As of August 1, 2026, the Company was in compliance with all covenants contained in its outstanding debt arrangements.

Asset-Based Revolving Credit Agreement

The Company is party toa secured $40.0 million asset-based revolving credit facility agreement(the “ABL Credit Agreement” and, such facility, the“ABL Facility”), as amended, with a maturity date of May 10, 2028 (or 180 days prior to the maturity date of the Company’s 2025 Term Loan Credit Agreement if the maturity date of such 2025 Term Loan Facility has not been extended to a date that is at least 180 days after the maturity date of the ABL Credit Agreement).

The Company hadno short-term borrowings under the Company’s ABL Facility as of August 1, 2026 and January 31, 2026. The Company’s available borrowing capacity under the ABL Facility as of August 1, 2026 and January 31, 2026 was$35.7 million.

As of August 1, 2026 and January 31, 2026, there were outstanding letters of credit of$4.3 million, which reduced the availability under the ABL Facility. As of August 1, 2026, the maximum commitment for letters of credit was $15.0 million.

As of August 1, 2026, the Company was in compliance with all financial covenants in effect.

6. Fair Value Measurements

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

Valuation techniques used to measure fair value require the Company to maximize the use of observable inputs and minimize the use of unobservable inputs. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Financial assets and liabilities carried at fair value are to be classified and disclosed in one of the following three levels of the fair value hierarchy, of which the first two are considered observable and the last is considered unobservable:

•

Level 1 - Quoted prices in active markets for identical assets or liabilities.

•

Level 2 - Observable inputs, other than Level 1 prices, such as quoted prices for similar assets or liabilities in active markets; quoted prices for similar assets or liabilities in markets that are not active; or other inputs other than quoted prices that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities, including interest rates and yield curves, and market corroborated inputs.

•

Level 3 - Unobservable inputs for the assets or liabilities that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. These are valued based on management’s estimates and assumptions that market participants would use in pricing the asset or liabilities.

The following table presents the carrying value and fair value hierarchy for debt as of August 1, 2026 and January 31, 2026, respectively (in thousands):

The Company’s debt instruments include the Term Loan Credit Agreement. The debt instruments are recorded at cost, net of debt issuance costs and any related discount. The fair value of the debt instruments is obtained based on observable market prices quoted on public exchanges for similar instruments.

The Company believes that the carrying amounts of its other financial instruments, including cash, accounts receivable, accounts payable and any amounts drawn on its revolving credit facilities, consisting primarily of instruments without extended maturities, based on management’s estimates, approximates their fair value due to the short-term maturities of these instruments.

Assets and Liabilities with Recurring Fair Value Measurements - Certain assets and liabilities may be measured at fair value on an ongoing basis. We did not elect to apply the fair value option for recording financial assets and financial liabilities. Other than total debt and liability-classified stock options, we do not have any assets or liabilities which we measure at fair value on a recurring basis.

Assets and Liabilities with Nonrecurring Fair Value Measurements - Certain assets and liabilities are not measured at fair value on an ongoing basis. These assets and liabilities, which include long-lived assets, goodwill, and intangible assets, are subject to fair value adjustments as part of the related impairment tests. Assumptions used to measure these fair value adjustments are classified as

Level 3 inputs. Other than impairment accounting adjustments, no adjustments to fair value or fair value measurements were required for non-financial assets and liabilities for all periods presented. See Note 4 - Asset Impairments, for additional information.

7. Income Taxes

The Company recorded an income tax provision of$6.7 million and$4.0 million during the thirteen weeks ended August 1, 2026 and August 2, 2025, respectively. The Company recorded an income tax provision of$9.3 million and$9.0 million during the twenty-six weeks ended August 1, 2026 and August 2, 2025, respectively.

The effective tax rates were 28.6% and 27.7% for the thirteen weeks ended August 1, 2026 and August 2, 2025, respectively, and 30.2% and 28.8% for the twenty-six weeks ended August 1, 2026 and August 2, 2025, respectively.

The effective tax rates for the thirteen and twenty-six weeks ended August 1, 2026 differ from the federal statutory rate of 21% primarily due to the impact of state and local income taxes, stock compensation shortfalls, and executive compensation limitations. The effective tax rates forthe thirteen and twenty-six weeks ended August 2, 2025 differ from the federal statutory rate of 21% primarily due to the impact of state and local income taxes and executive compensation limitations.

8. Shareholders’ Equity

Share Repurchase Program

On December 6, 2024, the Board of Directors (the “Board”) approved a share repurchase program (the “Share Repurchase Program”), under which the Company is authorized to repurchase up to $25.0 million of the Company’s common stock fortwo years following the authorization date. Under the Share Repurchase Program, shares of the Company’s common stock may be purchased from time to time through open market or private transactions, block trades, or such other manner as the Company may determine, in accordance with applicable insider trading and other securities laws and regulations under the Exchange Act and share repurchase parameters determined by the Board.

During the thirteen and twenty-six weeks ended August 1, 2026, the Company repurchased 99,902 and 168,402 shares of its common stock for an aggregate purchase price of$1.5 million and$2.3 million, respectively. As of August 1, 2026, the Company had$11.8 million of availability remaining under its stock repurchase authorization. The purchase price of these share repurchases, and the related fees, have been classified as Treasury stock in the accompanying condensed consolidated balance sheets as of August 1, 2026. There were 68,440 and 255,240 shares repurchased by the Company during the thirteen and twenty-six weeks ended August 2, 2025.

The timing and the number of shares repurchased are subject to the discretion of the Company and may be affected by market conditions and other factors. The Share Repurchase Program does not obligate the Company to acquire any particular amount of common stock and may be modified, suspended or terminated at any time.

During the thirteen weeks ended August 1, 2026, the Board declared a quarterly cash dividend payment of $0.09 per share of common stock (the “Dividend”). The Dividend was payable on July 8, 2026 to stockholders of record of issued and outstanding shares of the Company’s common stock as of June 24, 2026. Duringthe thirteen and twenty-six weeks ended August 1, 2026, the Company paid$1.4 million and$2.7 million, respectively, in dividends. While dividends are generally recorded as a reduction to Retained earnings, since the Company has an accumulated deficit, dividends are recorded as a reduction to Additional paid-in capital on the condensed consolidated balance sheets.

The Company intends to pay cash dividends quarterly in the future, subject to market conditions and at the discretion of the Board. The Company's ability to pay dividends in the future is based on a number of factors, such as earnings levels, capital requirements, restrictions imposed by applicable law, our overall financial condition, restrictions in our debt agreements and the ability of our operating subsidiaries to pay dividends to us as a holding company.

9. Net Income Per Share

The following table summarizes the computation of basic and diluted net income per common share (“EPS”) (in thousands, except share and per share data):

Share-based awards are excluded from the diluted earnings per share calculation when their inclusion would have an antidilutive effect such as when the Company has a net loss for the reporting period, or if the assumed proceeds per share of the award is in excess of the related fiscal period’s average price of the Company’s common stock. Accordingly,121,129 and 232,825 shares for the thirteen and twenty-six weeks ended August 1, 2026, respectively, and 279,851 and 278,166 shares for the thirteen and twenty-six weeks ended August 2, 2025, respectively, were excluded from the diluted earnings per share calculation because their inclusion would be antidilutive.

10. Share-Based Payment

On March 11, 2025, the Board approved and authorized an amendment and restatement (the “Amendment”) to the Company’s Amended and Restated 2017 Omnibus Equity Incentive Plan (the “A&R Plan”). The A&R Plan is administered by the Compensation Committee of the Board (the “Committee”). The Committee has the authority to determine the type, size and terms and conditions of awards granted under the A&R Plan.

On June 27, 2025, the Company registered an additional 750,000 shares of its common stock at par value of $0.01 per share. As of August 1, 2026, the A&R Plan has 2,793,453 shares of common stock reserved for issuance to awards granted by the Committee with an aggregate of 692,031 shares remaining for future issuance.

During the twenty-six weeks ended August 1, 2026 and August 2, 2025, the Board approved and granted Restricted Stock Units (“RSUs”), dividend equivalent RSUs, Performance Stock Units (“PSUs”) and dividend equivalent PSUs under the A&R Plan.

Restricted Stock Units

For the twenty-six weeks ended August 1, 2026 and August 2, 2025, the Board granted RSUs under the A&R Plan, which vest in one to three equal annual installments, beginning one year from the date of grant. The grant-date fair value of RSUs is recognized as expense on a straight-line basis over the requisite service period, which is generally the vesting period. In connection with the cash dividend paid on the Company’s common stock and in accordance with the terms of the A&R Plan, participants holding RSUs were credited with dividend equivalent RSUs, which are subject to the same vesting terms as the RSUs. Forthe twenty-six weeks ended August 1, 2026 and August 2, 2025, the fair market value of RSUs was determined based on the market price of the Company’s shares on the date of the grant.

The following table summarizes the RSU awards activity forthe twenty-six weeks ended August 1, 2026:

As of August 1, 2026, there was$8.9 million of total unrecognized compensation expense related to unvested RSUs, which is expected to be recognized over a weighted-average service period of 2.0 years. The total fair value of RSUs vested during the twenty-six weeks ended August 1, 2026 and August 2, 2025 was$4.4 million and$4.9 million, respectively.

Performance Stock Units

For the twenty-six weeks ended August 1, 2026 and August 2, 2025, the Board granted PSUs, a portion of which are based on achieving an adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”) goal and the remaining portion is based on achieving an annualized absolute total shareholder return (“TSR”) growth goal.

Each PSU award reflects a target number of shares (“Target Shares”) that may be issued to the award recipient provided the employee continues to provide services to the Company throughout the three-year performance period of the award. For Adjusted EBITDA based PSUs, the number of units earned will be determined based on the achievement of the predetermined Adjusted EBITDA goals at the end of each performance year, and for TSR based PSUs, the number of units earned will be determined based on the achievement of the predetermined TSR growth goal at the end of a three-year performance period. The TSR is based on J.Jill’s 30-trading day average beginning and closing price of thethree-year performance period, assuming the reinvestment of dividends. Depending on the performance results based on Adjusted EBITDA and TSR, the actual number of shares that a grant recipient receives at the end of the vesting period may range from 0% to 200% of the Target Shares granted. PSUs are converted into shares of common stock upon vesting, under the terms of the A&R Plan. In connection with the cash dividend paid on the Company’s common stock and in accordance with the terms of the A&R Plan, participants holding PSUs were credited with dividend equivalent PSUs, a portion of which are based on an Adjusted EBITDA goal and the remaining portion is based on achieving an annualized TSR growth goal, each subject to the same vesting terms as the corresponding PSUs.

The fair value of the PSUs granted duringthe twenty-six weeks ended August 1, 2026 for which the performance is based on an Adjusted EBITDA goal was determined based on the market price of the Company’s shares on the date of the grant. Additionally, for those awards whose performance is based on a TSR growth goal, the fair value was estimated using a Monte Carlo simulation as of the grant date. These valuations were based on the assumptions noted below:

The Company recognizes share-based compensation expense related to Adjusted EBITDA based PSUs based on the Company’s estimate of the percentage of the award that will be achieved. The Company evaluates the estimate of these awards on a quarterly basis and adjusts share-based compensation expense related to these awards, as appropriate. For the TSR based PSUs, the share-based compensation expense is recognized on a straight-line basis over thethree-year performance period based on the grant-date fair value of these PSUs.

The following table summarizes the PSU awards activity forthe twenty-six weeks ended August 1, 2026:

As of August 1, 2026, there was$2.8 million of total unrecognized compensation expense related to unvested PSUs, which is expected to be recognized over a weighted-average service period of 2.1 years.

Share-based compensation expense for RSUs and PSUs was recorded in the Selling, general and administrative expenses in the condensed consolidated statement of operations and comprehensive income. The Company recorded$1.8 million and$3.0 million for the thirteen and twenty-six weeks ended August 1, 2026, respectively, and$1.4 million and$2.4 million forthe thirteen and twenty-six weeks ended August 2, 2025, respectively. As per the terms of the A&R Plan, as the dividend equivalent awards are subject to the same vesting conditions as their underlying awards, the Company didnot record any additional share-based compensation expense associated with these awards.

Stock Options

On December 9, 2024, the Company entered into a consulting agreement with Elm St Advisors, LLC (“Elm Street”), which was subsequently amended on March 11, 2025 (as amended, the “Consulting Agreement”). The Consulting Agreement resulted in a net award of 33,334 stock options to Elm Street, which vested on February 7, 2025. The amendment resulted in the cancellation of 66,666 of the original 100,000 stock options initially awarded under the Consulting Agreement, and accordingly, the reversal of $0.3 million of compensation expense was reversed in Selling, general and administrative expenses on the condensed consolidated statements of operations and comprehensive income during the twenty-six weeks ended August 2, 2025. The stock options expire three years from the December 9, 2024 grant date. As of August 2, 2025, there wasno unrecognized compensation cost as the stock options were fully vested.

The Company applied liability accounting to the stock options prior to their vesting since the Board retained sole discretion over the determination of the milestone achievements and the related vesting, as described in the Consulting Agreement. Upon vesting the stock options became equity-classified and the corresponding liability was reclassified from Accrued expenses and other current liabilities to Additional paid-in capital on the condensed consolidated balance sheets.

The fair value of the stock options as of February 7, 2025 was calculated using the Black-Scholes option-pricing model with the following assumptions:

During the thirteen weeks ended August 2, 2025, the outstanding stock options, including previously issued stock options have aweighted average fair value of $30.17, weighted average exercise price of $59.85 and a weighted average remaining contractual term of 0.8 years.

11. Related Party Transactions

For the thirteen and twenty-six weeks ended August 1, 2026 and August 2, 2025, the Company incurred an immaterial amount of other expenses in connection with related party transactions. As of August 1, 2026 and January 31, 2026, the Company owed its related parties immaterial amounts.

12. Commitments and Contingencies

Legal Proceedings

The Company is subject to various legal proceedings that arise in the ordinary course of business. Although the outcome of such proceedings cannot be predicted with certainty, management does not believe that the Company is presently party to any legal proceedings the resolution of which management believes would have a material adverse effect on the Company’s financial statements. The Company establishes reserves for specific legal matters, including legal costs, when the Company determines that the likelihood of an unfavorable outcome is probable, and the loss is reasonably estimable.

Tariff Refunds

On February 20, 2026, the U.S. Supreme Court ruled that certain of the tariffs imposed in fiscal 2025 under the International Emergency Economic Powers Act (“IEEPA”) were unlawful and remanded the case to the U.S. Court of International Trade (“CIT”) to provide a remedy for importers who had paid the tariffs. On March 4, 2026, the CIT ordered U.S. Customs and Border Protection (“CBP”) to begin refunding all tariffs imposed under IEEPA. On April 20, 2026, CBP launched a process for importers to submit IEEPA refund claims. The Company submitted claims for refunds totaling $18.4 million in April 2026. In the second quarter of fiscal 2026, the Company began receiving refunds for IEEPA tariffs previously paid, totaling approximately $19.0 million, including $0.6 million of interest. Approximately $13.3 million isreflected within “Cost of goods sold (exclusive of depreciation and amortization),” and the interest is reflected within "Interest income” in the accompanying unaudited Condensed Consolidated Income Statements. The Company accounts for such refunds as gain contingencies and recognizes any recovery when the gain is realized or realizable and the related contingencies have been substantially resolved. The Company does not expect the amounts of the remaining refunds of IEEPA tariffs to be material.

13. Segment Reporting

Operating Segments

The Company operates throughtwo operating segments, Retail and Direct, based on the criteria used by the Chief Operating Decision Maker (“CODM”) to monitor performance and allocate resources. For reporting purposes, these operating segments have been aggregated into asingle reportable segment due to their similar economic characteristics and shared resources. The segment derives its revenues from the sale of apparel and accessory merchandise through the retail stores and website and catalog orders.

Performance Assessment and Resource Allocation

The Company’s CODM is the Chief Executive Officer. To assess the performance of the Company, the CODM primarily uses net income to analyze shopping behaviors and allocate resources effectively to enhance sales and margins. Net income is integral to the annual budgeting and forecasting process, with monthly reviews of variances from actuals against plan and forecast when making decisions on marketing spend, capital investments, and personnel. The accounting policies of the segment are the same as those described in the summary of significant accounting policies.

An extract of the financial information that is regularly provided to the CODM for the Company’s single reportable segment is listed below:

(a)

Other segment items represent the Company’s OMS upgrade, management incentives, impairments of long-lived assets, interest expense, interest income, income taxes, and depreciation and amortization.

Geographic Information

All of the Company’s identifiable assets are located in the United States, which is where the Company is domiciled. The Company has immaterial sales outside the United States. No customer represents more than 10%of total revenues for any period presented.

14. Subsequent Events

On September 2, 2026, the Board declared a quarterly cash dividend of $0.09 per share, payable on October 7, 2026 to stockholders of record of issued and outstanding shares of the Company’s common stock as of September 23, 2026.