Financial Analysis

Commitments and Contingencies Legal Matters The Company is from time to time involved in various claims and legal actions arising in the ordinary course of business, including proceedings involving workers compensation and other employee claims, unfair business practices, tort, and other general liability claims. While the Company cannot predict with certainty the results of these claims and legal actions in which it is currently or in the future may be involved, the Company does not expect that the ultimate disposition of any currently pending claims or actions will have a material adverse effect on the Companys condensed consolidated balance sheets, statements of operations and comprehensive income (loss), or liquidity. …

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A summary of disaggregated net revenues is as follows: 13 Weeks Ended 26 Weeks Ended (in thousands) June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025 Direct-to-consumer (DTC) $ 135,324 $ 111,682 $ 233,749 $ 186,378 Wholesale and other 19,909 13,391 33,784 24,786 Net revenues $ 155,233 $ 125,073 $ 267,533 $ 211,164

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Stock-Based Compensation In 2019, the Company established the 2019 Stock Option Plan (the 2019 Plan) to allow the Company to issue nonqualified stock options (NQSO) to eligible participants. The 2019 Plan is administered by the Compensation Committee of the Companys Board of Directors, which determines the terms of the options granted, including exercise price, number of options granted, and vesting period of such options. Under the 2019 Plan, the exercise price of options may not be less than the fair market value of the Companys common stock at the date of grant. Options have a term of no more than ten years from the date of grant and are generally cancelled 90 days after termination of employment or other service. As of June 27, 2026, there were 6,724,960 shares reserved for issuance under the 2019 Plan, of which options to purchase 5,838,178 shares were outstanding and 886,782 shares remained available for issuance. Stock Options Prior to March 27, 2026, the Company granted 50% of its options with a service condition (time-based option) and 50% of the options with both market and an implied performance condition (performance-based option) (collectively, the Options). The time-based options generally vest over a four-year period with 25% of the shares vesting one year after the service date and the remaining 75% of shares vesting in equal installments monthly for the following 36 months. The performance-based options were originally set to vest when the Companys controllin …

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Goodwill, Trade Name and Intangible Assets, Net Goodwill, trade name and intangible assets consist of the following: As of June 27, 2026 (in thousands) Useful Life (Years) Gross Accumulated Amortization Net Carrying Amount Trade name Indefinite $ 309,100 $ - $ 309,100 Goodwill Indefinite 209,421 - 209,421 E-commerce and retail customer relationships 8 6,700 5,723 977 $ 525,221 $ 5,723 $ 519,498 As of December 27, 2025 (in thousands) Useful Life (Years) Gross Accumulated Amortization Net Carrying Amount Trade name Indefinite $ 309,100 $ - $ 309,100 Goodwill Indefinite 209,421 - 209,421 E-commerce and retail customer relationships 8 6,700 5,304 1,396 $ 525,221 $ 5,304 $ 519,917

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Income Taxes The Company accounts for income taxes in interim periods using an income statement approach in accordance with ASC 740-270. Under this approach, the interim income tax provision is determined by estimating the annual effective tax rate expected to be applicable for the full fiscal year and applying that rate to year to date ordinary income (or loss). For the 13 weeks ended June 27, 2026 and June 28, 2025, the Companys effective tax rate of 27.5% and 25.4%, respectively, differs from the U.S. federal statutory rate of 21% primarily due to state and local income taxes. For the 26 weeks ended June 27, 2026, the Companys effective tax rate of 75.3% differs from the U.S. federal statutory rate of 21% primarily due to discrete state and local tax items, the impact of which is magnified by the 26 weeks ended June 27, 2026 pretax income. For the 26 weeks ended June 28, 2025, the Companys effective tax rate of 24.1% differs from the U.S. federal statutory rate of 21% primarily due to state and local income taxes on ordinary income. …

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Leases The Company has certain manufacturing facilities, warehouse, office, and retail space that are accounted for as operating leases. The Companys lease terms may include options to extend or terminate the lease and are, therefore, included in the operating lease right-of-use assets and operating lease liabilities when such options are reasonably certain to be exercised. Rent expense is recorded on a straight-line basis over the term of the lease (operating lease cost) and is included in cost of goods sold and selling, general, and administrative expenses on the condensed consolidated statements of operations and comprehensive income (loss). The following table presents the Companys total lease cost: 13 Weeks Ended 26 Weeks Ended (in thousands) June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025 Operating lease expense $ 8,397 $ 7,048 $ 16,274 $ 13,553 Short term lease expense - 76 - 76 Variable lease expense 1,540 1,371 2,706 2,302 Total lease expense $ 9,938 $ 8,495 $ 18,980 $ 15,931 Other information related to leases are as follows: As of June 27, 2026 December 27, 2025 Weighted average remaining lease term (in years) Operating leases 9.2 9.4 Weighted average discount rate Operating leases 5.0 % 4.8 % Future minimum lease payments for operating leases are as follows: (in thousands) Operating Lease Liability Fiscal year Remainder of 2026 $ 11,501 2027 30,458 2028 29,556 2029 27,367 2030 24,457 Thereafter 125,390 Total undiscounted lease payments 248,729 Less: Impute …

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"Long-Term Debt On May 2, 2024, LYMI Inc., a wholly owned subsidiary of Reformation Inc., entered into a credit agreement with JPMorgan Chase Bank, N.A., Citibank, N.A., Morgan Stanley Senior Funding, Inc. and Royal Bank of Canada (the Credit Agreement), to secure a five-year term loan of $165.0 million (Term Loan) and a revolving line of credit (Revolver) with a maximum borrowing capacity of $30.0 million (together, the Credit Facility). On June 17, 2026, the Company entered into an amendment to its Credit Agreement (the ""Amendment""). The Amendment, among other things, (i) provided for an additional $52.0 million of term loan borrowing (ii) provided for an incremental $40.0 million delayed draw term loan facility, of which, $40.0 million was funded on June 17, 2026 (iii) extended the maturity date of the term loan facilities and the revolving credit facility to June 17, 2031, and (iv) revised the scheduled principal amortization of the term loan facilities to reduce required principal payments over the remaining term of the debt. Upon completion of the Amendment, the Company had $246.7 million of term loan borrowings outstanding on June 17, 2026. Borrowings under the Amended Term Loans bear interest at a variable rate based on (Secured Overnight Financing Rate (SOFR) plus an applicable margin. The Company evaluated the Amendment in accordance with ASC 470, Debt, and concluded that the amendments to the term loan facilities should be accounted for as a debt modification as …

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Recently Issued Accounting Pronouncements In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09). The new guidance requires, on an annual basis, disclosure of specific categories in the rate reconciliation and disclosure of income taxes paid disaggregated by jurisdiction. The Company will adopt the new standard during the year ended December 26, 2026. Adoption of the new standard is expected to result in expanded tax disclosures. In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses (ASU 2024-03). The new guidance requires additional disclosure related to the disaggregation of income statement expense categories. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027, with early adoption permitted. The adoption of ASU 2024-03 is expected to result in additional disclosures and the Company is currently evaluating the effect this standard will have on the condensed consolidated financial statements. In September 2025, the FASB issued ASU No. 2025-06, IntangiblesGoodwill and Other Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software . This update provides amendments to clarify and modernize the accounting for costs incurred to develop or acquire internal-use software. Under this guidance, capitalization for internal- …

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Net Revenues A summary of disaggregated net revenues is as follows: 13 Weeks Ended 26 Weeks Ended (in thousands) June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025 Direct-to-consumer (DTC) $ 135,324 $ 111,682 $ 233,749 $ 186,378 Wholesale and other 19,909 13,391 33,784 24,786 Net revenues $ 155,233 $ 125,073 $ 267,533 $ 211,164 Direct-to-consumer represents net revenues from e-commerce through the Companys online sale platform and net revenues from retail through direct product sales made from stores located in the U.S., United Kingdom, Canada, and France. Wholesale and other net revenues consist of sales made to third-party retailers such as department stores and online retailers, sales to distributors, and other miscellaneous revenues such as sample sales. …

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Segment Information The Companys operations are conducted as one operating segment and one reportable segment via revenue derived from the sale of individual products sold to customers through various channels. Segment information has been determined based on how the Companys chief operating decision maker (CODM) manages its business, makes operating decisions, and evaluates operating performance. The Companys CODM is its Chief Executive Officer. The Companys assets are managed centrally and are reported internally in the same manner as the condensed consolidated financial statements, and thus, no additional information is disclosed herein. While the CODM evaluates operating performance based on both consolidated net income and Adjusted EBITDA, the primary measure of profit and loss evaluated by the CODM for its single reportable segment is consolidated net income. The CODM is also regularly provided disaggregated expense information, as shown below: 13 Weeks Ended 26 Weeks Ended (in thousands) June 27, 2026 June 28, 2025 June 27, 2026 June 28, 2025 Revenue $ 155,233 $ 125,073 $ 267,533 $ 211,164 Less: Cost of goods sold(a) 51,500 44,508 84,566 78,688 Selling expenses(a) 22,364 16,256 40,180 27,791 Marketing expenses(a) 14,490 11,250 23,942 19,792 Employee compensation(b) 22,297 19,917 42,422 37,487 Occupancy expenses 10,233 9,864 19,436 18,159 Other segment expenses(c) 9,191 7,415 16,628 14,121 Depreciation of property and equipment 4,036 2,806 7,988 5,458 Amortization of de …

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Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying condensed consolidated interim financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United States (U.S. GAAP) for interim reporting (ASC 270) and in accordance with Article 10 of Regulation S-X. As permitted under those rules, certain footnotes or other financial information that are normally required by U.S. GAAP, can be condensed or omitted. These financial statements have been prepared on the same basis as the Companys annual audited financial statements and, in the opinion of management, reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for the fair statement of the Companys financial position as of June 27, 2026 and December 27, 2025, the Companys results of operations for the 13 and 26 weeks ended June 27, 2026 and the corresponding periods in 2025, and the Companys cash flows for the 26 weeks ended June 27, 2026 and June 28, 2025. The financial information as of December 27, 2025, is derived from the Companys audited consolidated financial statements and related notes for the fiscal year ended December 27, 2025. These interim results are not necessarily indicative of the results to be expected for the fiscal year ending December 26, 2026, or for any other interim period or for any other future year. All intercompany balances and transactions are …

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Stockholders Equity The Companys Board of Directors has authorized one class of shares, common stock. On July 13, 2026, the Company effected a 142.7-for-1 forward split of its common stock and a proportionate increase in the number of authorized shares. Accordingly, all share and per share information throughout the consolidated financial statements have been retroactively adjusted to reflect the stock split. As of June 27, 2026, the Company was authorized to issue 107,025,000 shares of common stock and had 49,793,037 shares issued and outstanding, as adjusted for the stock split. Effective July 31, 2026, the number of authorized shares of the Companys common stock available for issuance was increased to 500,000,000. Dividend Recapitalization Transaction On June 17, 2026, the Company declared a dividend in the amount of $1.63 per share (as adjusted for the 142.7-for-1 forward stock split) to holders of its common stock using proceeds from the Amendment to the Credit Agreement as discussed in Note 7. The Board of Directors determined the dividend to be an extraordinary dividend under the 2019 Plan and certain RSU agreements, and consequently approved an adjustment to options outstanding under the 2019 Plan and RSUs outstanding under the RSU Agreements, pursuant to which (i) certain options and RSUs received an amount in cash equal to $1.63 for each such option and RSU, as applicable, (ii) the strike price of certain options was reduced by $1.63 for each such option and (iii) c …

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Subsequent Events Initial Public Offering On July 31, 2026, the Company completed its IPO, pursuant to which the Company issued and sold 9,478,821 shares of common stock, and the selling stockholders sold an aggregate of 4,583,679 shares of common stock at a price per share of $15.00. The Company received aggregate proceeds of approximately $132.2 million from the IPO, after deducting the underwriting discount of $10.0 million. On September 1, 2026, an additional 229,546 shares of common stock were sold by the selling stockholders pursuant to the underwriters partial exercise of their option to purchase additional shares. The Company did not receive any proceeds from the sale of these shares. Upon the completion of the IPO, the Companys authorized capital stock consists of 500,000,000 shares of common stock, $0.0001 par value per share and 10,000,000 shares of preferred stock, $0.0001 par value per share. Following the IPO, the Company used $110.0 million of the net proceeds for the partial repayment of term loans under the Credit Agreement and $8.5 million to repurchase shares of common stock and outstanding stock options from certain existing stockholders and employees. The remaining proceeds will be used to pay for expenses associated with the IPO and for general corporate purposes. 2026 Omnibus Incentive Plan Effective July 29, 2026, the Company adopted the 2026 Omnibus Incentive Plan (the 2026 Plan), pursuant to which the Company and its affiliates employees, consultants …

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