Financial Analysis

8. COMMITMENTS AND CONTINGENCIES CONTINGENCIES We record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. If a loss is at least reasonably possible, we disclose the nature of the contingency and, if reasonably estimable, the possible loss or range of loss. If a loss is at least reasonably possible and the amount or range of loss cannot be reasonably estimated, no accrual is recorded and we disclose that an estimate cannot be made. Accordingly, unless otherwise indicated below, we are unable to estimate the possible loss or range of loss for contingencies where a loss is at least reasonably possible. Accounting for contingencies requires us to use judgment related to both the likelihood of a loss and the estimate of the amount or range of loss. Although we cannot predict with assurance the outcome of any litigation or tax matters, we do not believe there are currently any such actions that, if resolved unfavorably, would have a material adverse impact on our operating results, financial position, and cash flows. On August 26, 2022, a class action lawsuit alleging violations of federal securities laws was filed by certain of our stockholders in the U.S. District Court for the Northern District of California, naming as defendants us and certain of our officers and directors (the Securities Class Action). The lawsuit alleges violations of the Securities Exchange Act of 1934, as amended, by us and our …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

7. CREDIT FACILITY The Company has a revolving credit facility (the Credit Facility), with Citibank, N.A. as agent and lender, which provides for up to $50.0 million of borrowings. This Credit Facility matures on December 11, 2028. The Credit Facility includes a sub-facility that provides for the issuance of letters of credit in an amount of up to $30.0 million. Availability of the Credit Facility is based upon a borrowing base formula and periodic borrowing base certifications valuing certain of our accounts receivable, credit card receivables, and inventory as reduced by certain reserves, if any. Our borrowing availability based on balances as of August 1, 2026, was $50.0 million, and our excess availability was $33.1 million as a result of outstanding letters of credit, and no outstanding borrowing. The Credit Facility is subject to customary fees for loan facilities of this type, including a commitment fee equal to 0.30% based on the average daily undrawn portion of the Credit Facility, payable quarterly. The interest rate applicable to the Credit Facility will be, at our option, either (a) the Adjusted Term SOFR rate for the applicable interest period (subject to a 0.00% floor), plus a margin of 2.00% or (b) the Base Rate plus a margin of 2.00%. The Base Rate is the highest of (a) the federal funds rate plus 0.50%, (b) the Wall Street Journal prime rate, or (c) the Adjusted Term SOFR rate for a one-month interest period plus 1.00%. Debt under the Credit Facility is guara …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

10. STOCK-BASED COMPENSATION STOCK PLANS 2011 Equity Incentive Plan In 2011, we adopted the 2011 Equity Incentive Plan (the 2011 Plan). The 2011 Plan provided for the grant of stock-based awards to employees, directors, and non-employees under terms and provisions established by the Board of Directors. The 2011 Plan allowed for the grant of incentive stock options or nonqualified stock options, as well as restricted stock unit (RSU) awards, restricted stock awards (RSAs), and stock appreciation rights. Only incentive and nonqualified stock options were granted under the 2011 Plan. Employee stock option awards generally vested 25% on the first anniversary of the grant date with the remaining shares subject to the option vesting ratably over the next three years subject to the employees continued service with the Company. Options generally expire after 10 years. Effective upon our initial public offering in 2017, the 2011 Plan was replaced by the 2017 Incentive Plan. 2017 Incentive Plan In November 2017, our Board of Directors and stockholders adopted our 2017 Incentive Plan (the 2017 Plan). The remaining shares available for issuance under our 2011 Plan became reserved for issuance under the 2017 Plan. Our 2017 Plan provides for the grant of Class A incentive stock options to employees and for the grant of nonqualified stock options, stock appreciation rights, RSAs, RSU awards, performance restricted stock unit (PSU) awards, performance cash awards, and other forms of stock aw …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

3. FAIR VALUE MEASUREMENTS Our financial instruments consist of cash, cash equivalents, investments, accounts receivable, accounts payable, and accrued liabilities. At August 1, 2026, and August 2, 2025, the carrying values of cash, accounts receivable, accounts payable, and accrued liabilities approximated fair value due to their short-term nature. We measure our cash equivalents and investments at fair value within Level 1 or Level 2 of the fair value hierarchy because we value these investments using unadjusted, quoted market prices; or alternative pricing sources and models utilizing market observable inputs, respectively. Further, the Company measures the fair value of certain lease right of use assets and other long-lived assets subject to long-lived asset impairment using Level 3 unobservable inputs. Refer to Note 4 herein for additional information. Our cash equivalents and investments, which were accounted for as available-for-sale securities and were measured at fair value on a recurring basis, were as follows: August 1, 2026 August 2, 2025 (in thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 49,819 $ $ $ 49,819 $ 59,945 $ $ $ 59,945 Investments: U.S. Treasury securities (1) 31,766 31,766 16,541 16,541 Corporate bonds (1) 79,981 79,981 105,110 105,110 Asset backed securities (1) 8,428 8,428 1,499 1,499 Yankee bonds 5,447 5,447 5,645 5,645 Total $ 81,585 $ 93,856 $ $ 175,441 $ 76,486 $ 112,254 $ $ 188,740 ( …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

11. INCOME TAXES The components of loss from continuing operations before income taxes were as follows: For the Fiscal Year Ended (in thousands) August 1, 2026 August 2, 2025 August 3, 2024 Loss from continuing operations before income taxes: United States $ (12,268) $ (28,023) $ (120,546) Total loss from continuing operations before income taxes $ (12,268) $ (28,023) $ (120,546) The components of the income tax provision (benefit) were as follows: For the Fiscal Year Ended (in thousands) August 1, 2026 August 2, 2025 August 3, 2024 Current: Federal $ 31 $ 305 $ (1,663) State 307 516 2 Total current $ 338 $ 821 $ (1,661) Deferred: Total deferred $ $ $ Total income tax provision (benefit) $ 338 $ 821 $ (1,661) Beginning in fiscal 2026, the Company adopted ASU 2023-09 prospectively. A reconciliation of the U.S. federal statutory income tax rate to the Companys effective tax rate pursuant to the disclosure requires of ASU 2023-09 for the year ended August 1, 2026 was as follows: For the Fiscal Year Ended (in thousands, except percentages) August 1, 2026 U.S. Federal Statutory Tax Rate $ (2,576) 21.0 % State and Local Income Taxes, Net of Federal Income Tax Effect (1) (100) 0.8 % Tax Credits: Research and development tax credits (9,468) 77.2 % Changes in Valuation Allowances 3,258 (26.6) % Nontaxable or Nondeductible Items: Share-based Compensation (961) 7.8 % Excess Officer's Compensation 5,511 (44.9) % Meals and Entertainment 512 (4.2) % Charitable Contributions 599 (4.9) % Oth …

IncomeTaxDisclosureTextBlock · excerpt; the full note is in the filing

4. LEASES Our leasing portfolio includes lease arrangements for our corporate offices and fulfillment centers. Such leases generally have original lease terms between five years and eleven years, and often include one or more options to renew. We have not considered any of our renewal options reasonably certain to be exercised at lease commencement and do not have residual value guarantees associated with our leases. As of August 1, 2026, the Company subleases certain office and warehouse space to third parties. These subleases have total original lease terms ranging from approximately one year to six years that will expire at various dates by fiscal year 2030. The future lease payments as of August 1, 2026, were as follows: (in thousands) August 1, 2026 2027 $ 23,927 2028 22,544 2029 9,170 2030 9,409 2031 6,922 Thereafter 3,267 Total undiscounted future minimum lease payments (1) 75,239 Less: imputed interest 6,894 Total discounted future minimum lease payments $ 68,345 (1) Total future minimum lease payments have not been reduced by minimum sublease income of approximately $8.7 million. The weighted average remaining term for our leases as of August 1, 2026 and August 2, 2025 was 3.8 years and 4.4 years, respectively. The weighted average discount rate for our leases as of August 1, 2026 and August 2, 2025 was 5.1% and 5.2%, respectively. On August 12, 2026, the Company entered into an amendment to its existing lease agreement for a fulfillment center, commencing in Decembe …

LesseeOperatingLeasesTextBlock · excerpt; the full note is in the filing

"RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Beginning in fiscal 2026 annual reporting, we adopted Accounting Standards Update ""ASU"" No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (ASU 2023-09) on a prospective basis. This update enhances the transparency and decision usefulness of income tax disclosures by improving the income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The update also includes certain other amendments to improve the effectiveness of income tax disclosures. The adoption of this standard did not have a material impact on our consolidated financial statements or related disclosures. Refer to Note 11 herein for additional information. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). This update is to improve the disclosures of components of certain income statement expense items. In January 2025, the FASB additionally issued ASU No. 2025-01, which clarified the effective date of ASU 2024-03 for entities that do not have a calendar year-end. This guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027 and should be applied on either a retrospective or prospective basis, with early a …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

14. RESTRUCTURING In June 2022, we announced a restructuring plan (the 2022 Restructuring Plan) to reduce our future fixed and variable operating costs and allow us to centralize key capabilities, strengthen decision-making to drive efficiencies, and ensure we are allocating resources to our most critical priorities. In fiscal 2022 and 2023, in furtherance of and as an expansion of the 2022 Restructuring Plan, we reduced our employee workforce, impaired a portion of our corporate office space, and announced intended closures of certain fulfillment centers. In fiscal 2024, in furtherance of and as an expansion of the 2022 Restructuring Plan, we closed certain fulfillment centers, implemented an organizational realignment which eliminated certain styling leadership and corporate positions, revised our compensation model for Stylists, and impaired a portion of our corporate office space in the fourth quarter of fiscal 2024 due to change in the use of the space. In fiscal 2025, in furtherance of and as an expansion of the 2022 Restructuring Plan, we continued to implement an organizational realignment by eliminating certain corporate positions. In fiscal 2026, no additional restructuring charges related to the 2022 Restructuring Plan were recorded. The components of total restructuring charges were as follows: For the Fiscal Year Ended (in thousands) August 1, 2026 August 2, 2025 August 3, 2024 Cash restructuring charges: Severance and employee-related benefits (1) $ $ 1,163 $ 10 …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

13. SEGMENT REPORTING The Company identifies any operating segments based on whether the Companys Chief Executive Officer, who is the Chief Operating Decision Maker (CODM), regularly reviews operating results of particular components of the Companys activities and allocates resources and assesses performance based on those results. The Company has one operating segment and, as a result, one reportable segment related to the sale of merchandise directly to clients who received a curated shipment of items or purchased directly from its website or mobile app. Financial information and data are provided to the CODM on a consolidated basis. The CODM uses consolidated net loss from continuing operations, as reported on the Companys consolidated statements of operations, to evaluate performance, make key operating decisions, and allocate resources. Net loss from continuing operations is used to compare budget to actual results. All long-lived assets are located in the United States and revenue is attributable to customers based in the United States. The following table presents selected financial information with respect to the Company's single reportable segment, including significant segment expenses that are regularly provided to the CODM: For the Fiscal Year Ended (in thousands) August 1, 2026 August 2, 2025 August 3, 2024 Revenue, net $ 1,348,119 $ 1,267,171 $ 1,337,468 Less: Cost of goods sold 759,628 704,232 745,430 Advertising expense 129,617 117,254 111,399 Stock-based comp …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

6. COMMITMENTS AND CONTINGENCIES CONTINGENCIES We record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. If a loss is at least reasonably possible, we disclose the nature of the contingency and, if reasonably estimable, the possible loss or range of loss. If a loss is at least reasonably possible and the amount or range of loss cannot be reasonably estimated, no accrual is recorded and we disclose that an estimate cannot be made. Accordingly, unless otherwise indicated below, we are unable to estimate the possible loss or range of loss for contingencies where a loss is at least reasonably possible. Accounting for contingencies requires us to use judgment related to both the likelihood of a loss and the estimate of the amount or range of loss. Although we cannot predict with assurance the outcome of any litigation or tax matters, we do not believe there are currently any such actions that, if resolved unfavorably, would have a material adverse impact on our operating results, financial position, and cash flows. On August 26, 2022, a class action lawsuit alleging violations of federal securities laws was filed by certain of our stockholders in the U.S. District Court for the Northern District of California, naming as defendants us and certain of our officers and directors (the Securities Class Action). The lawsuit alleges violations of the Securities Exchange Act of 1934, as amended, by us and our …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

5. CREDIT FACILITY On December 4, 2023, we entered into a first lien credit agreement (the Credit Agreement) with Citibank, N.A., as agent and lender, which provides for a $50.0 million revolving credit facility (the Credit Facility), with a maturity date of December 4, 2026. The Credit Facility includes a sub-facility that provides for the issuance of letters of credit in an amount of up to $30.0 million. Availability of the Credit Facility is based upon a borrowing base formula and periodic borrowing base certifications valuing certain of our accounts receivable, credit card receivables, and inventory as reduced by certain reserves, if any. On December 11, 2025, we entered into a First Amendment (the Amendment) to the Credit Agreement, which extended the maturity date to December 11, 2028. Except as otherwise noted herein, the terms of the Credit Agreement were not materially modified by the Amendment. Our borrowing availability based on balances as of May 2, 2026, was $50.0 million, and our excess availability was $33.1 million as a result of outstanding letters of credit, and no outstanding borrowing. The Credit Facility is subject to customary fees for loan facilities of this type, including a commitment fee equal to 0.30% based on the average daily undrawn portion of the Credit Facility, payable quarterly. The interest rate applicable to the Credit Facility will be, at our option, either (a) the Adjusted Term SOFR rate for the applicable interest period (subject to a 0. …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

8. STOCK-BASED COMPENSATION STOCK PLANS 2011 Equity Incentive Plan In 2011, we adopted the 2011 Equity Incentive Plan (the 2011 Plan). The 2011 Plan provided for the grant of stock-based awards to employees, directors, and non-employees under terms and provisions established by the Board of Directors. The 2011 Plan allowed for the grant of incentive stock options or nonqualified stock options, as well as restricted stock unit (RSU) awards, restricted stock awards (RSAs), and stock appreciation rights. Only incentive and nonqualified stock options were granted under the 2011 Plan. Employee stock option awards generally vested 25% on the first anniversary of the grant date with the remaining shares subject to the option vesting ratably over the next three years subject to the employees continued service with the Company. Options generally expire after 10 years. Effective upon our initial public offering in 2017, the 2011 Plan was replaced by the 2017 Incentive Plan. 2017 Incentive Plan In November 2017, our Board of Directors and stockholders adopted our 2017 Incentive Plan (the 2017 Plan). The remaining shares available for issuance under our 2011 Plan became reserved for issuance under the 2017 Plan. Our 2017 Plan provides for the grant of Class A incentive stock options to employees and for the grant of nonqualified stock options, stock appreciation rights, RSAs, RSU awards, performance restricted stock unit (PSU) awards, performance cash awards, and other forms of stock awa …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

3. FAIR VALUE MEASUREMENTS Our financial instruments consist of cash, cash equivalents, investments, accounts receivable, accounts payable, and accrued liabilities. At May 2, 2026, and August 2, 2025, the carrying values of cash, accounts receivable, accounts payable, and accrued liabilities approximated fair value due to their short-term nature. We measure our cash equivalents and investments at fair value within Level 1 or Level 2 of the fair value hierarchy because we value these investments using unadjusted, quoted market prices; or alternative pricing sources and models utilizing market observable inputs, respectively. Further, the Company measures the fair value of certain lease right of use assets and other long-lived assets subject to long-lived asset impairment using Level 3 unobservable inputs. Our cash equivalents and investments, which were accounted for as available-for-sale securities and were measured at fair value on a recurring basis as of May 2, 2026, and August 2, 2025, were as follows: May 2, 2026 August 2, 2025 (in thousands) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 52,192 $ $ $ 52,192 $ 59,945 $ $ $ 59,945 Investments: U.S. Treasury securities (1) 39,763 39,763 16,541 16,541 Corporate bonds (1) 88,425 88,425 105,110 105,110 Asset backed securities (1) 8,455 8,455 1,499 1,499 Yankee bonds 5,421 5,421 5,645 5,645 Total $ 91,955 $ 102,301 $ $ 194,256 $ 76,486 $ 112,254 $ $ 188,740 (1) For May 2, 2026 …

FairValueDisclosuresTextBlock · excerpt; the full note is in the filing

9. INCOME TAXES The following table summarizes our effective tax rate from loss from continuing operations for the periods presented: For the Three Months Ended For the Nine Months Ended (in thousands, except percentages) May 2, 2026 May 3, 2025 May 2, 2026 May 3, 2025 Loss from continuing operations before income taxes $ (1,455) $ (7,140) $ (10,347) $ (19,687) Provision for income taxes 70 241 194 580 Effective tax rate (4.8) % (3.4) % (1.9) % (2.9) % Our continuing operations are subject to income taxes in the United States. Our effective tax rate for the three and nine months ended May 2, 2026, differs from the federal statutory income tax rate primarily due to the full valuation allowance recorded on our net federal and state deferred tax assets. The tax provision for the three and nine months ended May 2, 2026, is primarily comprised of state taxes. Our effective tax rate for the three and nine months ended May 3, 2025, differs from the federal statutory income tax rate primarily due to the full valuation allowance recorded on our net federal and state deferred tax assets. The tax provision for the three and nine months ended May 3, 2025, is primarily comprised of state taxes.

IncomeTaxDisclosureTextBlock

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). This update enhances the transparency and decision usefulness of income tax disclosures by improving the income tax disclosures primarily related to the rate reconciliation and income taxes paid information. The update also includes certain other amendments to improve the effectiveness of income tax disclosures. This guidance is effective for annual periods beginning after December 15, 2024 and should be applied on a prospective basis, with early adoption permitted. We do not anticipate this standard to have a material impact on our consolidated financial statements or related disclosures. In November 2024, the FASB issued ASU No. 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (ASU 2024-03). This update is to improve the disclosures of components of certain income statement expense items. In January 2025, the FASB additionally issued ASU No. 2025-01, which clarified the effective date of ASU 2024-03 for entities that do not have a calendar year-end. This guidance is effective for annual reporting periods beginning after December 15, 2027 and should be applied on either a retrospective or prospective basis, with early adoption permitted. We are currently evaluating the impact that this standard wi …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

11. SEGMENT REPORTING The following table presents selected financial information with respect to the Company's single reportable segment, including significant segment expenses that are regularly provided to the Chief Operating Decision Maker, the Companys Chief Executive Officer: For the Three Months Ended For the Nine Months Ended (in thousands) May 2, 2026 May 3, 2025 May 2, 2026 May 3, 2025 Revenue, net $ 340,277 $ 325,016 $ 1,023,701 $ 955,944 Less: Cost of goods sold 191,439 181,458 576,594 528,720 Advertising expense 34,863 33,248 97,654 87,686 Stock-based compensation expense 11,139 13,727 37,040 43,658 Depreciation and amortization expense 6,116 6,860 18,662 21,360 Interest income (2,123) (2,627) (6,661) (8,222) Other (income) expense, net (438) 59 (323) 210 Provision for income taxes 70 241 194 580 Other segment expenses (1) 100,736 99,431 311,082 302,219 Net loss from continuing operations $ (1,525) $ (7,381) $ (10,541) $ (20,267) (1) Other segment expenses is primarily comprised of payroll and benefits expenses, technology fees, facilities expense, and other general and administrative expenses. …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing