Financial Analysis

14. COMMITMENTS AND CONTINGENCIES Tariff Refunds During fiscal 2025 and early fiscal 2026, the company incurred import duties under tariffs imposed pursuant to the International Emergency Economic Powers Act (IEEPA). On February 20, 2026, the U.S. Supreme Court ruled that such tariffs were not authorized, and on March 4, 2026, the U.S. Court of International Trade (CIT) ordered U.S. Customs and Border Protection to refund certain tariffs collected under IEEPA. As of May 3, 2026, the company identified certain potential refunds of previously paid tariffs in accordance with the ruling by the CIT. The company estimated the total potential recovery to be approximately $ 7.0 million, which recovery remained subject to administrative review and final liquidation of the underlying customs entries by U.S. Customs and Border Protection. Accordingly, this potential recovery was considered a gain contingency in accordance with ASC Topic 450, and therefore the company did not recognize a receivable related to potential tariff refunds as of May 3, 2026. During the first quarter of fiscal 2027, the company received the entire $ 7.0 million in cash proceeds representing a final approval of these tariff refund claims. The $ 7.0 million is expected to be recognized as a credit to inventory for inventory that is on hand and within cost of sales for inventory that has been sold during the first quarter fiscal 2027 Consolidated Balance Sheet and Consolidated Statement of Net Income (Loss), respe …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

18. BENEFIT PLANS Defined Contribution Plans We have defined contribution plans that cover substantially all employees and allow participants to contribute on a pre-tax basis, along with matching contributions by the company for its U.S. and, before it was closed our Canadian operations. Our contributions to these plans were $ 1.0 million, $ 1.1 million, and $ 1.2 million during fiscal years 2026, 2025, and 2024, respectively. Deferred Compensation Plan We have a non-qualified deferred compensation plan (the Plan) covering senior executives and certain key members of management. The Plan provides for participant deferrals on a pre-tax basis that are subject to annual deferral limits by the IRS and non-elective contributions made by the company. Participant deferrals and non-elective contributions made by the company are immediately vested. Our contributions to the Plan were $ 206,000 , $ 206,000 , and $ 229,000 during fiscal years 2026, 2025, and 2024, respectively. Our non-qualified deferred compensation plan liability was $ 6.5 million and $ 7.0 million as of May 3, 2026, and April 27, 2025, respectively. We have a rabbi trust (the Trust) to set aside funds for the participants of the Plan that enables the participants to direct their contributions to various investment options in the Plan. The investment options in the Plan consist of a money market fund and various mutual funds. The funds set aside in the Trust are subject to the claims of our general creditors in the eve …

CompensationAndEmployeeBenefitPlansTextBlock · excerpt; the full note is in the filing

"11. LINES OF CREDIT The summary of outstanding borrowings under our lines of credit follows: (dollars in thousands) May 3, 2026 April 27, 2025 Wells Fargo - U.S. revolving line of credit $ 7,000 $ 4,600 Agricultural Bank of China - supplier financing arrangements 1,893 2,751 Agricultural Bank of China - working capital loan (executed May 2025) 3,071 Agricultural Bank of China - working capital loan (executed March 2026) 4,241 Agricultural Bank of China - revolving line of credit 3,988 Bank of China - working capital loan 1,462 1,375 China Construction Bank Corporation - working capital loan 1,462 Lines of credit (1) $ 19,129 $ 12,714 (1) Of the total $ 19.1 million, $ 12.1 million and $ 7.0 million were recorded within lines of credit - current and line of credit - long-term, respectively, within the Consolidated Balance Sheet as of May 3, 2026. Of the total $ 12.7 million, $ 8.1 million and $ 4.6 million were recorded within lines of credit - current and line of credit - long-term, respectively, within the Consolidated Balance Sheet as of April 27, 2025. Revolving Credit Agreement United States On June 12, 2025, Culp, Inc., as borrower, and Read and Culp Fabrics Global, LLC, each a wholly-owned domestic subsidiary of the company, as guarantors (collectively, the Guarantors), entered into a Third Amendment to the Second Amended and Restated Credit Agreement (the Third Amendment), by and among the company, the Guarantors and Wells Fargo Bank, National Association, as lender ( …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table presents our disaggregated revenue related to operations by segment, timing of revenue recognition, and product sales versus services rendered for fiscal 2026: (dollars in thousands) Bedding Upholstery Total Products transferred at a point in time $ 116,593 $ 80,044 $ 196,637 Services transferred over time 6,845 6,845 Total Net Sales $ 116,593 $ 86,889 $ 203,482 The following table presents our disaggregated revenue related to operations by segment, timing of revenue recognition, and product sales versus services rendered for fiscal 2025: (dollars in thousands) Bedding Upholstery Total Products transferred at a point in time $ 113,906 $ 87,322 $ 201,228 Services transferred over time 12,009 12,009 Total Net Sales $ 113,906 $ 99,331 $ 213,237 The following table presents our disaggregated revenue related to operations by segment, timing of revenue recognition, and product sales versus services rendered for fiscal 2024: (dollars in thousands) Bedding Upholstery Total Products transferred at a point in time $ 116,370 $ 98,976 $ 215,346 Services transferred over time 9,987 9,987 Total Net Sales $ 116,370 $ 108,963 $ 225,333 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"15. STOCK-BASED COMPENSATION Equity Incentive Plan Description On September 16, 2015, our shareholders approved an equity incentive plan titled the Culp, Inc. 2015 Equity Incentive Plan (the 2015 Plan). The 2015 Plan authorizes the grant of stock options intended to qualify as incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, time-based restricted stock units, performance-based restricted stock units, and other equity and cash related awards as determined by the Compensation Committee of our board of directors. An aggregate of 1,200,000 shares of common stock were authorized for issuance under the 2015 Plan, with certain sub-limits that would apply with respect to specific types of awards that may be issued as defined in the 2015 Plan. Effective September 27, 2023, our shareholders approved an amendment and restatement of the 2015 Plan (the ""Amended and Restated Plan""). The Amended and Restated Plan authorizes the issuance of an additional 960,000 shares of common stock in addition to the shares of common stock still available for issuance under the 2015 Plan. The Amended and Restated Plan also removed certain sub-limits that previously applied with respect to specific type of awards that may be issued under the plan . As of May 3, 2026, there were 387,293 shares available for future equity-based grants under the companys Amended and Restated Plan. Time-Based Restricted Stock Awards The following table summarizes the time-bas …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

16. FAIR VALUE ASC Topic 820 establishes a fair value hierarchy that distinguishes between assumptions based on market data (observable inputs) and the companys assumptions (unobservable inputs). Determining where an asset or liability falls within that hierarchy depends on the lowest level input that is significant to the fair value measurement as a whole. An adjustment to the pricing method used within either level 1 or level 2 inputs could generate a fair value measurement that effectively falls in a lower level in the hierarchy. The hierarchy consists of three broad levels, as follows: Level 1 Quoted market prices in active markets for identical assets or liabilities, Level 2 Inputs other than level 1 inputs that are either directly or indirectly observable, and Level 3 Unobservable inputs developed using the companys estimates and assumptions, which reflect those that market participants would use. The determination of where an asset or liability falls in the hierarchy requires significant judgment. We evaluate our hierarchy disclosures each reporting period based on various factors, and it is possible that an asset or liability may be classified differently from reporting period to reporting period. However, we expect that changes in classifications between different levels will be rare. Recurring Basis The following tables present information about assets measured at fair value on a recurring basis: Fair value measurements as of May 3, 2026, using: Quoted prices in act …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

"12. INCOME TAXES The components of loss before income taxes are as follows: (dollars in thousands) 2026 2025 2024 United States $ ( 15,081 ) $ ( 18,395 ) $ ( 18,614 ) Foreign 6,796 ( 316 ) 7,844 $ ( 8,285 ) $ ( 18,711 ) $ ( 10,770 ) Income tax expense consists of: (dollars in thousands) 2026 2025 2024 Current income tax expense (benefit) U.S. federal $ 2 $ ( 579 ) $ 42 U.S. state 5 4 Foreign 2,056 2,310 2,620 Total current income tax expense 2,063 1,735 2,662 Deferred income tax expense (benefit) U.S. federal 1,642 3,872 4,505 U.S. federal loss carryforwards and credits ( 1,642 ) ( 3,872 ) ( 4,505 ) U.S. state ( 12 ) 258 229 U.S. state carryforwards 12 ( 258 ) ( 229 ) Foreign ( 137 ) ( 1,343 ) 387 Total deferred income tax (benefit) expense $ ( 137 ) $ ( 1,343 ) $ 387 Total income tax expense (benefit) U.S. federal $ 1,644 $ 3,293 $ 4,547 U.S. federal loss carryforwards and credits ( 1,642 ) ( 3,872 ) ( 4,505 ) U.S. state ( 7 ) 262 229 U.S. federal & state carryforwards and credits 12 ( 258 ) ( 229 ) Foreign 1,919 967 3,007 Total income tax expense $ 1,926 $ 392 $ 3,049 The entire amount of income tax expense of $ 1.9 million, $ 392,000 , and $ 3.0 million during fiscal 2026, 2025, and 2024, respectively, was allocated to loss from continuing operations. Disaggregating Income Tax Disclosures On December 14, 2023, the FASB issued ASU 2023-09 which applies to all entities subject to income taxes. This standard requires disaggregated information about a reporting entitys ef …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

13. LEASES Leases Overview We leased manufacturing facilities, showroom and office space, distribution centers, and equipment under operating leases. Our operating leases have remaining lease terms of one to six years , with renewal options for additional periods ranging up to twelve years . Balance Sheet The right of use assets and lease liabilities associated with our operating leases as of May 3, 2026, and April 27, 2025, are as follows: (dollars in thousands) May 3, 2026 April 27, 2025 Right of use assets $ 2,984 $ 5,908 Operating lease liability - current 956 2,394 Operating lease liability long-term 1,027 2,535 Supplemental Cash Flow Information (dollars in thousands) 2026 2025 2024 Operating lease liability payments $ 2,084 $ 2,391 $ 2,663 Right of use assets exchanged for lease liabilities 2,837 978 Operating lease costs were $ 2.2 million, $ 2.9 million, and $ 3.1 million during fiscal 2026, 2025, and 2024, respectively. Short-term lease costs were $ 182,000 , $ 13,000 , and $ 34,000 during fiscal 2026, 2025, and 2024, respectively. Variable lease expense was immaterial for each of fiscal 2026, 2025, and 2024. As of May 3, 2026, the weighted average remaining lease term and discount rate for our operating leases follows: Weighted average lease term 3.4 years Weighted average discount rate 5.53 % As of April 27, 2025, the weighted average remaining lease term and discount rate for our operating leases follows: Weighted average lease term 2.9 years Weighted average dis …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"Recently Adopted Accounting Pronouncements Effective December 14, 2023, the Financial Accounting Standards Board (the ""FASB"") issued Accounting Standards Update (""ASU"") 2023-09 Improvements to Income Tax Disclosures (""ASU 2023-09"" ), which is an update to Topic 740, Income Taxes . The amendments in this update relate to improvements regarding the transparency of income tax disclosures by requiring consistent categories and greater disaggregation by jurisdiction of information included in the effective income tax rate reconciliation and for income taxes paid. Also, the amendments allow investors to better assess an entity's: (i) capital allocation decisions, (ii) worldwide operations, and (iii) related tax risks, tax planning, and operational opportunities that affect the effective income tax rate and prospects for future cash flows. The other amendments in this update improve the effectiveness and comparability of disclosures relating to pretax income (or loss) and income tax expense (or benefit) and remove disclosures that are no longer considered cost beneficial or relevant. ASU 2023-09 became effective during the fourth quarter of fiscal 2026 , and we applied this new guidance retrospectively in our fiscal 2026 annual consolidated financial statements. This guidance did not have an impact on our results of operations and financial condition, but did have a material impact on the disclosures required in the notes to the consolidated financial statements, which are di …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

10. RESTRUCTURING ACTIVITIES Restructuring Activities Announced May 1, 2024 On April 29, 2024 (first quarter of fiscal 2025), our board of directors made a decision to: (1) consolidate the company's North American bedding operations, including the closure and sale of the Property located in Quebec, Canada; (2) move a portion of the knitting and finishing capacity from the company's manufacturing facility located in Quebec, Canada to the company's manufacturing facility located in Stokesdale, North Carolina; (3) transition the bedding segment's weaving operation to a strategic sourcing model through the company's long-standing supply partners; (4) consolidate the company's sewn mattress cover operation located in Ouanaminthe, Haiti, from two leased facilities into one building and reduce other operating expenses at this location; and (5) reduce unallocated corporate and shared service expenses. These restructuring activities were completed by the end of the second quarter of fiscal 2026, including the sale of Property located in Quebec, Canada. Accordingly, we recorded a gain from the sale of this Property totaling $ 4.0 million that was classified within restructuring credit in the fiscal 2026 Consolidated Statement of Net Loss. See Notes 7 and 8 to the consolidated financial statements for further details regarding the Sales Agreement associated with the sale of Property and determination of fair value. Since the inception of this restructuring initiative, we have incurred c …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

3. REVENUE FROM CONTRACTS WITH CUSTOMERS Nature of Performance Obligations Our operations are classified into two business segments: bedding (formerly known as mattress fabrics) and upholstery (formerly known as upholstery fabrics). The bedding segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers. The upholstery segment develops, sources, manufactures, and sells fabrics primarily to residential, commercial, and hospitality manufacturers. In addition, the upholstery segment includes Read, a wholly-owned subsidiary that provides window treatments and sourcing of upholstery fabrics and other products, as well as related measuring and installation services to customers in the hospitality and commercial markets. On April 24, 2025 (fourth quarter of fiscal 2025), the company announced a strategic transformation of its operating model that combined certain activities within the bedding and upholstery business segments to create one integrated Culp-branded business. As part of this strategic transformation, we closed a leased facility in Burlington, North Carolina, and a leased facility located in Knoxville, Tennessee, each operated by our upholstery segment, and transitioned their production and distribution activities utilizing a shared management model within our owned facility located in Stokesdale, North Carolina. See note 10 to the consolidated financial statements for further details regarding this strategic transformation ini …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"19. SEGMENT INFORMATION During the first quarter of fiscal 2026, we renamed our two reportable segments to better reflect our product offerings. Our former mattress fabrics segment is now known as the bedding segment and our former upholstery fabrics segment is now known as the upholstery segment. The bedding segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers. The upholstery segment develops, sources, manufactures, and sells fabrics primarily to residential, commercial, and hospitality furniture manufacturers. In addition, the upholstery segment includes Read, a wholly-owned subsidiary that provides window treatments and sourcing of upholstery fabrics and other products, as well as related measuring and installation services to customers in the hospitality and commercial markets. Read also supplies soft goods such as decorative top sheets, coverlets, duvet covers, bed skirts, bolsters, and pillows. On April 24, 2025 (the fourth quarter of fiscal 2025), the company announced a strategic transformation of its operating model that combined certain activities within the bedding and upholstery business segments and created one integrated Culp-branded business. As part of this strategic transformation, we closed a leased facility in Burlington, North Carolina and a leased facility in Knoxville, Tennessee, each operated by our upholstery segment, and transitioned their production and distribution activities to a shared management …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

18. Commitments and Contingencies Tariff Refunds During fiscal 2025 and early fiscal 2026, the company incurred import duties pursuant to IEEPA. On February 20, 2026, the U.S. Supreme Court ruled that such tariffs were not authorized, and on March 4, 2026, the U.S. Court of International Trade (CIT) ordered U.S. Customs and Border Protection to refund certain tariffs collected under IEEPA. As of May 3, 2026, the company identified certain potential refunds of previously paid tariffs in accordance with the ruling by the CIT. The company estimated the total potential recovery to be approximately $ 6.9 million, which remained subject to administrative review and final liquidation of the underlying customs entries by U.S. Customs and Border Protection. Accordingly, this potential recovery was considered a gain contingency in accordance with ASC Topic 450, and therefore the company did not recognize a receivable related to potential tariff refunds as of May 3, 2026. During the first quarter of fiscal 2027, the company received the entire $ 6.9 million in cash proceeds (excluding interest), representing the final approval of these tariff refund claims. The $ 6.9 million was recorded within cost of sales in the first quarter of fiscal 2027 Consolidated Statement of Net Income. Legal Matters The company is from time-to-time involved in legal proceedings and claims which arise in the ordinary course of business. Management has determined that any such current matters, when ultimately …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

"11. Lines of Credit The summary of outstanding borrowings under our lines of credit follows: (dollars in thousands) August 2, 2026 August 3, 2025 May 3, 2026 Wells Fargo - U.S. revolving line of credit $ $ 7,025 $ 7,000 Agricultural Bank of China - supplier financing arrangements 2,962 2,780 1,893 Agricultural Bank of China - 21.0 million RMB working capital loan 3,109 2,919 3,071 Agricultural Bank of China - 29.0 million RMB working capital loan 4,293 4,241 Agricultural Bank of China - revolving line of credit 4,031 Bank of China - working capital loan 1,480 1,390 1,462 China Construction Bank Corporation - working capital loan 1,480 1,462 Lines of credit (1) $ 13,324 $ 18,145 $ 19,129 (1) As of August 2, 2026, all $ 13.3 million was recorded within lines of credit - current within the Consolidated Balance Sheet. As of August 3, 2025, $ 11.1 million and $ 7.0 million were recorded within lines of credit - current and line of credit - long-term, respectively. As of May 3, 2026, $ 12.1 million and $ 7.0 million were recorded within lines of credit - current and line of credit - long-term, respectively. Revolving Credit Agreement United States On June 12, 2025, Culp, Inc., as borrower (the Company), and Read and Culp Fabrics Global, LLC, each a wholly owned domestic subsidiary of the Company, as guarantors (collectively, the Guarantors), entered into a Third Amendment to the Second Amended and Restated Credit Agreement (the Third Amendment), by and among the Company, the Guara …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ended August 2, 2026: (dollars in thousands) Bedding Upholstery Total Products transferred at a point in time $ 31,750 $ 21,119 $ 52,869 Services transferred over time 1,104 1,104 Total net sales $ 31,750 $ 22,223 $ 53,973 The following table presents our disaggregated revenue by segment, timing of revenue recognition, and product sales versus services rendered for the three-month period ended August 3, 2025: (dollars in thousands) Bedding Upholstery Total Products transferred at a point in time $ 28,046 $ 20,774 $ 48,820 Services transferred over time 1,871 1,871 Total net sales $ 28,046 $ 22,645 $ 50,691 …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

"16. Stock-Based Compensation Equity Incentive Plan Description On September 16, 2015, our shareholders approved an equity incentive plan titled the Culp, Inc. 2015 Equity Incentive Plan (the 2015 Plan). The 2015 Plan authorizes the grant of stock options intended to qualify as incentive stock options, nonqualified stock options, stock appreciation rights, restricted stock, time-based restricted stock units, performance-based restricted stock units, and other equity and cash related awards as determined by the Compensation Committee of our board of directors. An aggregate of 1,200,000 shares of common stock were authorized for issuance under the 2015 Plan, with certain sub-limits that would apply with respect to specific types of awards that may be issued as defined in the 2015 Plan. Effective September 27, 2023, our shareholders approved an amendment and restatement of the 2015 Plan (the ""Amended and Restated Plan""). The Amended and Restated Plan authorizes the issuance of an additional 960,000 shares of common stock in addition to the shares of common stock still available for issuance under the 2015 Plan. The Amended and Restated Plan also removed certain sub-limits that previously applied with respect to specific types of awards that may be issued under the plan. As of August 2, 2026, there were 392,017 shares available for future equity-based grants under the Amended and Restated Plan. Performance-Based Restricted Stock Units On August 7, 2025, we granted senior execut …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

12. Fair Value ASC Topic 820 establishes a fair value hierarchy that distinguishes between assumptions based on market data (observable inputs) and the companys assumptions (unobservable inputs). Determining where an asset or liability falls within that hierarchy depends on the lowest level input that is significant to the fair value measurement as a whole. An adjustment to the pricing method used within either Level 1 or Level 2 inputs could generate a fair value measurement that effectively falls to a lower level in the hierarchy. The hierarchy consists of three broad levels as follows: Level 1 Quoted market prices in active markets for identical assets or liabilities; Level 2 Inputs other than Level 1 inputs that are either directly or indirectly observable; and Level 3 Unobservable inputs developed using the companys estimates and assumptions, which reflect those that market participants would use. The determination of where an asset or liability falls in the hierarchy requires significant judgment. We evaluate our hierarchy disclosures each quarter based on various factors, and it is possible that an asset or liability may be classified differently from reporting period to reporting period. However, we expect that changes in classifications between different levels will be rare. Recurring Basis The following tables present information about assets measured at fair value on a recurring basis: Fair value measurements as of August 2, 2026, using: Quoted prices Significant i …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

15. Income Taxes Effective Income Tax Rate Our consolidated effective income tax rates for the three-month periods ended August 2, 2026, and August 3, 2025, were based upon the estimated effective income tax rate applicable for the full year after giving effect to any significant items related specifically to interim periods. When calculating the annual estimated effective income tax rates for the three-month periods ended August 2, 2026, and August 3, 2025, we were subject to loss limitation rules. These loss limitation rules require any pre-tax loss associated with our U.S. or foreign operations to be excluded from the annual estimated effective income tax rate calculation if it was determined that no income tax benefit could be recognized during the current fiscal year. The effective income tax rate can be impacted over the fiscal year by the mix and timing of actual earnings from our U.S. operations and foreign subsidiaries located in China, Canada, Haiti, and Vietnam versus annual projections, as well as changes in foreign currency exchange rates in relation to the U.S. dollar. We recorded income tax expense of $ 868,000 , or 12.7 % of income before income taxes, for the three-month period ended August 2, 2026, compared with income tax expense of $ 1.4 million, or 120.3 % of income before income taxes, for the three-month period ended August 3, 2025. The primary factors that decreased the company's effective income tax rate for the three months ended August 2, 2026, comp …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

17. Leases Overview We lease manufacturing facilities, showroom and office space, distribution centers, and equipment under operating lease arrangements. Our operating leases have remaining lease terms of 3 months to five years , with renewal options for additional periods ranging up to 12 years . Balance Sheet The right of use assets and lease liabilities associated with our operating leases as of August 2, 2026, August 3, 2025 and May 3, 2026, are as follows: (dollars in thousands) August 2, 2026 August 3, 2025 May 3, 2026 Right of use assets $ 2,642 $ 5,162 $ 2,984 Operating lease liability - current 765 2,209 956 Operating lease liability long-term 916 1,995 1,027 Supplemental Cash Flow Information Three months ended Three months ended (dollars in thousands) August 2, 2026 August 3, 2025 Operating lease liability payments $ 307 $ 746 Right of use assets exchanged for lease liabilities Operating lease expense for the three-month periods ended August 2, 2026, and August 3, 2025, was $ 378,000 and $ 735,000 , respectively . Short-term lease costs for the three-month periods ended August 2, 2026, and August 3, 2025, was $ 127,000 and $ 0 , respectively. No variable lease costs were incurred for the three-month periods ended August 2, 2026, and August 3, 2025. Other Information Maturity of our operating lease liabilities for the remainder of fiscal 2027, the subsequent four fiscal years, and thereafter follows: (dollars in thousands) 2027 $ 668 2028 388 2029 227 2030 229 2031 …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

Recently Adopted Accounting Pronouncements There were no recently adopted accounting pronouncements during the first quarter of fiscal 2027. Recently Issued Accounting Pronouncements On November 4, 2024, the FASB issued ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (ASU 2024-03), which is an update to Topic 220, Income Statement - Reporting Comprehensive Income. ASU 2024-03 enhances transparency and decision usefulness of expense disclosures in response to investors' requests for more detailed, disaggregated expense information, enabling a clearer understanding of a public business entity's performance and cost structure. The amendments improve disclosure requirements in the notes to the financial statements for specific expense categories including: (i) inventory purchases, (ii) employee compensation, (iii) depreciation, and (iv) intangible asset amortization, as well as (v) the total amount of selling expenses, and in annual reporting periods, the entity's definition of selling expense. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, (i.e., our fiscal 2028 annual report) and interim reporting periods beginning after December 15, 2027 (i.e., first quarter of fiscal 2029 interim report). Early adoption is permitted. The company is currently evaluating ASU 2024-03 to determine the impact it will have on its consolidated financial statements and related disclosures. We reviewed all oth …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

10. Restructuring Activities Restructuring Activities Announced May 1, 2024 On April 29, 2024 (first quarter of fiscal 2025), our board of directors made a decision to: (i) consolidate the company's North American bedding operations, including the closure and sale of the Property located in Quebec, Canada; (ii) move a portion of the knitting and finishing capacity from the company's manufacturing facility located in Quebec, Canada, to the company's manufacturing facility located in Stokesdale, North Carolina; (iii) transition the bedding segment's weaving operation to a strategic sourcing model through the company's long-standing supply partners; (iv) consolidate the company's sewn mattress cover operation located in Ouanaminthe, Haiti, from two leased facilities into one building and reduce other operating expenses at this location; as well as (v) reduce unallocated corporate and shared service expenses. These restructuring activities were completed by the end of the second quarter of fiscal 2026, including the sale of the Property located in Quebec, Canada. Accordingly, we recorded a gain from the sale of this Property totaling $ 4.0 million that was classified within restructuring credit in the Consolidated Statement of Net Loss for the three-month period ended August 3, 2025. See notes 7 and 8 of the consolidated financial statements for further details regarding the Sales Agreement associated with the sale of the Property and determination of its fair value. Since incept …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

4 . Revenue from Contracts with Customers Nature of Performance Obligations Our operations are classified into two business segments: bedding and upholstery. The bedding segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers. The upholstery segment develops, sources, manufactures, and sells fabrics primarily to residential, commercial, and hospitality furniture manufacturer s. In addition, the upholstery segment includes Read Window Products LLC (Read), a wholly owned subsidiary that provides window treatments and sourcing of upholstery fabrics and other products, as well as related measuring and installation services to customers in the hospitality and commercial markets. Read also supplies soft goods such as decorative top sheets, coverlets, duvet covers, bed skirts, bolsters, and pillows. Our primary performance obligations include the sale of bedding and upholstery products, as well as the performance of customized fabrication and installation services associated with window treatments. Contract Assets & Liabilities Certain contracts relating to customized fabrication and installation services associated with Read require upfront customer deposits that result in a contract liability that is recorded in the Consolidated Balance Sheets as deferred revenue. Revenue on contract liabilities associated with customized fabrication and installation services is generally recognized within one year, as the satisfaction of perform …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

"14. Segment Information During the first quarter of fiscal 2026, we renamed our two reportable segments to better reflect our product offerings. Our former mattress fabrics segment is now known as the bedding segment and our former upholstery fabrics segment is now known as the upholstery segment. The bedding segment manufactures, sources, and sells fabrics and mattress covers primarily to bedding manufacturers. The upholstery segment develops, sources, manufactures, and sells fabrics primarily to residential, commercial, and hospitality furniture manufacturers. In addition, the upholstery segment includes Read, a wholly owned subsidiary that provides window treatments and sourcing of upholstery fabrics and other products, as well as related measuring and installation services to customers in the hospitality and commercial markets. Read also supplies soft goods such as decorative top sheets, coverlets, duvet covers, bed skirts, bolsters, and pillows. On April 24, 2025 (the fourth quarter of fiscal 2025), the company announced a strategic transformation of its operating model that combined certain activities within the bedding and upholstery business segments and created one integrated Culp-branded business. As part of this strategic transformation, we closed a leased facility in Burlington, North Carolina, and a leased facility in Knoxville, Tennessee, each operated by our upholstery segment, and transitioned their production and distribution activities to a shared managemen …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

2. Significant Accounting Policies As of August 2, 2026, there were no changes in the nature of our significant accounting policies or the application of those policies from those reported in our Annual Report on Form 10-K for the year then ended May 3, 2026. Recently Adopted Accounting Pronouncements There were no recently adopted accounting pronouncements during the first quarter of fiscal 2027. Recently Issued Accounting Pronouncements On November 4, 2024, the FASB issued ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (ASU 2024-03), which is an update to Topic 220, Income Statement - Reporting Comprehensive Income. ASU 2024-03 enhances transparency and decision usefulness of expense disclosures in response to investors' requests for more detailed, disaggregated expense information, enabling a clearer understanding of a public business entity's performance and cost structure. The amendments improve disclosure requirements in the notes to the financial statements for specific expense categories including: (i) inventory purchases, (ii) employee compensation, (iii) depreciation, and (iv) intangible asset amortization, as well as (v) the total amount of selling expenses, and in annual reporting periods, the entity's definition of selling expense. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, (i.e., our fiscal 2028 annual report) and interim reporting periods beginning after December 1 …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing