Academy Sports & Outdoors, Inc. 10-Q

ITEM 1. FINANCIAL STATEMENTS ACADEMY SPORTS AND OUTDOORS, INC. CONSOLIDATED BALANCE SHEETS (Unaudited) (Dollar amounts in thousands, except per share data) May 2, 2026 January 31, 2026 May 3, 2025 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 337,810 $ 330,320 $ 285,104 Accounts receivable - less allowance for doubtful accounts of $ 1,209 , $ 1,792 and $ 2,584 , respectively 17,671 34,755 16,869 Merchandise inventories, net 1,654,429 1,503,756 1,560,035 Prepaid expenses and other current assets 93,249 82,457 59,757 Assets held for sale 2,957 2,957 — Total current assets 2,106,116 1,954,245 1,921,765 PROPERTY AND EQUIPMENT, NET 602,768 584,103 551,184 RIGHT-OF-USE ASSETS 1,290,110 1,234,246 1,210,516 TRADE NAME 579,860 579,766 579,165 GOODWILL 861,920 861,920 861,920 OTHER NONCURRENT ASSETS 62,826 62,756 55,873 Total assets $ 5,503,600 $ 5,277,036 $ 5,180,423 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 826,338 $ 637,854 $ 849,554 Accrued expenses and other current liabilities 274,857 243,908 272,362 Current lease liabilities 152,001 147,491 137,979 Current maturities of long-term debt 3,000 3,000 3,000 Total current liabilities 1,256,196 1,032,253 1,262,895 LONG-TERM DEBT, NET 480,320 480,793 482,209 LONG-TERM LEASE LIABILITIES 1,315,590 1,261,167 1,210,095 DEFERRED TAX LIABILITIES, NET 299,309 300,654 255,912 OTHER LONG-TERM LIABILITIES 31,219 30,792 22,080 Total liabilities 3,382,634 3,105,659 3,233,191 COMMITMENTS AND CONTINGENCIES (NOTE 10) STOCKHOLDERS' EQUITY: Preferred stock, $ 0.01 par value, authorized 50,000,000 shares; none issued and outstanding — — — Common stock, $ 0.01 par value, authorized 300,000,000 shares; 63,507,116 ; 64,945,953 and 66,466,377 issued and outstanding as of May 2, 2026, January 31, 2026 and May 3, 2025, respectively. 635 649 662 Additional paid-in capital 254,512 256,351 244,388 Retained earnings 1,865,819 1,914,377 1,702,182 Stockholders' equity 2,120,966 2,171,377 1,947,232 Total liabilities and stockholders' equity $ 5,503,600 $ 5,277,036 $ 5,180,423 See Condensed Notes to Consolidated Financial Statements 3 ACADEMY SPORTS AND OUTDOORS, INC. CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (Amounts in thousands, except per share data) Thirteen Weeks Ended May 2, 2026 May 3, 2025 NET SALES $ 1,442,003 $ 1,351,409 COST OF GOODS SOLD 962,655 892,540 GROSS MARGIN 479,348 458,869 SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 404,693 389,604 OPERATING INCOME 74,655 69,265 INTEREST EXPENSE, NET 8,988 9,044 OTHER INCOME, NET 3,222 2,807 INCOME BEFORE INCOME TAXES 68,889 63,028 INCOME TAX EXPENSE 16,186 16,944 NET INCOME $ 52,703 $ 46,084 EARNINGS PER COMMON SHARE: BASIC $ 0.82 $ 0.69 DILUTED $ 0.80 $ 0.68 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: BASIC 64,432 67,122 DILUTED 65,945 68,170 See Condensed Notes to Consolidated Financial Statements 4 ACADEMY SPORTS AND OUTDOORS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) (Amounts in thousands, except per share data) Additional Paid-In Capital Retained Earnings Total Stockholders' Equity Common Stock Shares Amount Balances as of January 31, 2026 64,946 $ 649 $ 256,351 $ 1,914,377 $ 2,171,377 Net income — — — 52,703 52,703 Equity compensation — — 11,100 — 11,100 Repurchase of common stock for retirement ( 1,703 ) ( 16 ) ( 7,626 ) ( 91,615 ) ( 99,257 ) Settlement of vested Restricted Stock Units, net of shares withheld 221 2 ( 6,028 ) — ( 6,026 ) Stock option exercises, net of shares withheld 43 — 715 — 715 Cash dividends declared, $ 0.15 per share — — — ( 9,646 ) ( 9,646 ) Balances as of May 2, 2026 63,507 $ 635 $ 254,512 $ 1,865,819 $ 2,120,966 Additional Paid-In Capital Retained Earnings Total Stockholders' Equity Common Stock Shares Amount Balances as of February 1, 2025 68,333 $ 683 $ 247,094 $ 1,756,258 $ 2,004,035 Net income — — — 46,084 46,084 Equity compensation — — 7,542 — 7,542 Repurchase of common stock for retirement ( 2,081 ) ( 20 ) ( 8,436 ) ( 91,444 ) ( 99,900 ) Settlement of vested Restricted Stock Units, net of shares withheld 163 ( 1 ) ( 3,300 ) — ( 3,301 ) Stock option exercises, net of shares withheld 51 — 1,488 — 1,488 Cash dividends declared, $ 0.13 per share — — — ( 8,716 ) ( 8,716 ) Balances as of May 3, 2025 66,466 $ 662 $ 244,388 $ 1,702,182 $ 1,947,232 See Condensed Notes to Consolidated Financial Statements 5 ACADEMY SPORTS AND OUTDOORS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Amounts in thousands) Thirteen Weeks Ended May 2, 2026 May 3, 2025 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 52,703 $ 46,084 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 30,757 30,150 Non-cash lease expense 3,068 12,665 Equity compensation 11,100 7,542 Amortization of deferred loan and other costs 646 649 Deferred income taxes ( 1,345 ) ( 903 ) Changes in assets and liabilities: Accounts receivable, net 17,084 ( 110 ) Merchandise inventories, net ( 150,673 ) ( 251,195 ) Prepaid expenses and other current assets ( 10,793 ) 35,863 Other noncurrent assets ( 438 ) ( 4,566 ) Accounts payable 177,965 231,762 Accrued expenses and other current liabilities 12,782 24,848 Income taxes payable 17,323 16,322 Other long-term liabilities 427 8,361 Net cash provided by operating activities 160,606 157,472 CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures ( 38,903 ) ( 50,830 ) Purchases of intangible assets ( 94 ) ( 158 ) Net cash used in investing activities ( 38,997 ) ( 50,988 ) CASH FLOWS FROM FINANCING ACTIVITIES: Repayment of Term Loan ( 750 ) ( 750 ) Proceeds from exercise of stock options 715 1,516 Taxes paid related to net share settlement of equity awards ( 6,026 ) ( 3,328 ) Repurchase of common stock for retirement ( 98,412 ) ( 99,031 ) Dividends paid ( 9,646 ) ( 8,716 ) Net cash used in financing activities ( 114,119 ) ( 110,309 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 7,490 ( 3,825 ) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 330,320 288,929 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 337,810 $ 285,104 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid for interest $ 3,069 $ 3,358 Cash paid for income taxes, net $ 104 $ — SUPPLEMENTAL DISCLOSURES OF NON-CASH ACTIVITIES: Non-cash capital expenditures $ 20,887 $ 17,641 Right-of-use assets obtained in exchange for new operating leases $ 92,710 $ 77,414 See Condensed Notes to Consolidated Financial Statements 6 ACADEMY SPORTS AND OUTDOORS, INC. CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. Nature of Operations The Company All references to “we,” “us,” “our” or the “Company” in the financial statements refer to Academy Sports and Outdoors, Inc., a Delaware corporation (“ASO, Inc.”) and the current parent holding company of our operations, and its consolidated subsidiaries. We conduct our operations primarily through our parent holding company’s indirect subsidiary, Academy, Ltd., a Texas limited partnership doing business as “Academy Sports + Outdoors”, or Academy, Ltd. All of the Company’s sales and business operations occur at Academy, Ltd., and Academy, Ltd. is also the borrower and/or issuer of the Company’s long-term debt and the lessee of the Company’s facilities. Our fiscal year represents the 52 or 53 weeks ending on the Saturday closest to January 31. The Company is a leading full-line sporting goods and outdoor recreation retailer in the United States in terms of net sales. As of May 2, 2026, we operated 324 “Academy Sports + Outdoors” retail locations in 21 states and three distribution centers located in Katy, Texas, Twiggs County, Georgia and Cookeville, Tennessee. Our distribution centers receive, store and ship merchandise to our stores and customers. We also sell merchandise to customers across most of the United States via our academy.com website and our mobile app. 2. Summary of Significant Accounting Policies The accompanying unaudited financial statements of the Company have been prepared as though they were required to be in accordance with Rule 10-01 of Regulation S-X for interim financial statements, however, they do not include all information and footnotes required by United States generally accepted accounting principles (“GAAP”) for complete financial statements. Certain information and footnote disclosures normally included in our annual consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. However, we believe that the disclosures included herein are adequate to make the information presented not misleading. These condensed consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2026, as filed with the Securities and Exchange Commission (the “SEC”) on March 17, 2026 (the “Annual Report”). The information furnished herein reflects all normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of the results for the interim periods presented. The results of operations for the thirteen weeks ended May 2, 2026 are not necessarily indicative of the results that will be realized for the fiscal year ending January 30, 2027 or any other period. The balance sheet as of January 31, 2026 has been derived from our audited financial statements as of that date. For further information, refer to our audited financial statements and notes thereto included in the Annual Report. Basis of Presentation and Principles of Consolidation These unaudited condensed consolidated financial statements include the accounts of ASO, Inc. and its subsidiaries, New Academy Holding Company, LLC (“NAHC”), Academy Managing Co., L.L.C., Associated Investors, L.L.C., Academy, Ltd., the Company’s operating company, Academy International Limited, Mason Creek Insurance Co., LLC, and Academy Procurement Co., LLC. NAHC, Academy Managing Co., LLC, and Associated Investors, LLC are intermediate holding companies. All intercompany balances and transactions have been eliminated in consolidation. 7 Use of Estimates in the Preparation of Financial Statements The preparation of financial statements in conformity with GAAP requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Our management bases its estimates on historical experience and other assumptions it believes to be reasonable under the circumstances. Actual results could differ significantly from those estimates. Our most significant estimates and assumptions that materially affect the financial statements involve difficult, subjective or complex judgments by management, including the valuation of merchandise inventories and performing goodwill, intangible and long-lived asset impairment analyses. Reclassifications Within the merchandise division sales table presented in Note 3, certain products and categories were recategorized amongst various categories and divisions, respectively, to better align with our current merchandising strategy and view of the business. As a result, we have reclassified sales between divisions in the thirteen weeks ended May 3, 2025 for comparability purposes. This reclassification is in divisional presentation only and did not impact the overall net sales balances previously disclosed. Share Repurchases On December 4, 2024, the Company’s Board of Directors approved a share repurchase program authorizing the repurchase of up to $ 700 million of its outstanding shares through December 4, 2027 (the “2024 Share Repurchase Program”), which replaced the prior program. Repurchases may be effected from time to time through open market purchases, block trades, privately negotiated purchases, accelerated share repurchase programs, and/or Rule 10b5-1 plans, or other discretionary trading plans, all in compliance with the rules of the SEC and other applicable legal requirements. The timing, manner, price and amount of repurchases will depend on market conditions, share price and other factors. The 2024 Share Repurchase Program does not require the Company to repurchase any specific number of shares, and may be suspended, modified or discontinued at any time. The following table summarizes our share repurchases for the periods presented: Thirteen Weeks Ended May 2, 2026 May 3, 2025 Shares repurchased 1,703,031 2,080,772 Aggregate amount paid (amounts in millions) (1) $ 99.3 $ 99.9 (1) Includes excise tax fees of $ 0.8 million and $ 0.9 million for the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. As of May 2, 2026, we had $ 338.2 million available for share repurchases pursuant to the 2024 Share Repurchase Program. Recent Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses , which requires disclosures about specific types of expenses included in the expense captions presented on the face of the income statement as well as disclosures about selling expenses. The new guidance is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The requirements will be applied prospectively with the option for retrospective application. The Company is evaluating the impact of adopting ASU 2024-03 on its consolidated financial statements. In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software , which requires removal of all references to prescriptive and sequential software development stages. The new guidance is effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, and should be applied on a prospective transition approach, a modified transition approach, or a retrospective transition approach. The Company is evaluating the impact of adopting ASU 2025-06 on its consolidated financial statements. 8 In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements , which provides clarification of current interim disclosure requirements. The new guidance is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, and should be applied either prospectively or retrospectively to periods presented. The Company is evaluating the impact of adopting ASU 2025-11 on its condensed consolidated financial statements. 3. Net Sales Revenue from merchandise sales is recognized, net of sales tax, when the Company’s performance obligation to the customer is met, which is when the Company transfers control of the merchandise to the customer. Store merchandise sales are recognized at the point of sale and e-commerce sales are recognized upon delivery to the customer. The following table sets forth the approximate amount of sales by merchandise divisions for the periods presented (amounts in thousands): Thirteen Weeks Ended May 2, 2026 May 3, 2025 Merchandise division sales (1) Outdoors $ 427,351 $ 382,554 Sports and recreation 355,945 335,064 Apparel 348,347 332,644 Footwear 300,812 292,691 Total merchandise sales (2) 1,432,455 1,342,953 Other sales (3) 9,548 8,456 Net Sales $ 1,442,003 $ 1,351,409 (1) Certain products and categories were recategorized amongst various categories and divisions, respectively, to better align with our current merchandising strategy and view of the business. As a result, we have reclassified sales between divisions in the thirteen weeks ended May 3, 2025, for comparability purposes. This reclassification is in divisional presentation only and did not impact the overall net sales balances previously disclosed. (2) E-commerce sales represented 11.0 % and 10.0 % of merchandise sales for the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. (3) Other sales consisted primarily of the gift card breakage income, credit card bounties and royalties, shipping income, sales return allowance and other items. We sell gift cards in stores, online and in third-party retail locations. The gift cards we sell have no expiration dates. A liability for gift cards, which is recorded in Accrued Expenses and Other Current Liabilities on our Condensed Consolidated Balance Sheets, is established at the time of sale and revenues are recognized as the gift cards are redeemed in stores or on our website. Based on historical gift card redemption patterns, we believe we can reasonably estimate the amount of gift cards that have a remote likelihood of redemption. These identified amounts are recorded as net sales and recognized in proportion to historical redemption trends, which is referred to as “breakage”. The following is a reconciliation of the gift card liability (amounts in thousands): Thirteen Weeks Ended May 2, 2026 May 3, 2025 Gift card liability, beginning balance $ 99,558 $ 96,469 Issued 21,871 19,909 Redeemed ( 31,697 ) ( 29,940 ) Recognized as breakage income ( 1,142 ) ( 1,126 ) Gift card liability, ending balance $ 88,590 $ 85,312 9 4. Long-Term Debt Our debt consisted of the following (amounts in thousands) as of: May 2, 2026 January 31, 2026 May 3, 2025 ABL Facility, due March 2029 $ — $ — $ — Term Loan, due November 2027 85,000 85,750 88,000 Notes, due November 2027 400,000 400,000 400,000 Total debt 485,000 485,750 488,000 Less current maturities ( 3,000 ) ( 3,000 ) ( 3,000 ) Less unamortized discount on Term Loan ( 194 ) ( 227 ) ( 327 ) Less deferred loan costs (1) ( 1,486 ) ( 1,730 ) ( 2,464 ) Long-term debt, net $ 480,320 $ 480,793 $ 482,209 (1) Deferred loan costs are related to the Term Loan and Notes. ABL Facility Academy, Ltd., as borrower, and certain wholly-owned subsidiaries, as guarantors, entered into an asset-based revolving $ 1 billion credit facility, dated March 8, 2024, with JPMorgan Chase Bank, N.A., as the administrative agent and collateral agent and other lenders party thereto (as amended to date, the “ABL Facility”). Borrowings, if any, under the ABL Facility bear interest, at our election, at adjusted term secured overnight financing rate (“Adjusted Term SOFR”) plus a margin of 1.25 % to 1.75 %. The ABL Facility also provides a fee applicable to the unused commitments of 0.375 %. The terms and conditions of the ABL Facility also require that we prepay outstanding loans under the ABL Facility under certain circumstances. As of May 2, 2026, no future prepayments of outstanding loans have been triggered under the terms and conditions of the ABL Facility. As of May 2, 2026, we had outstanding letters of credit of approximately $ 7.6 million, all of which were issued under the ABL Facility, and we had no borrowings outstanding, leaving an available borrowing capacity under the ABL Facility of $ 992.4 million. Term Loan Academy, Ltd., as borrower, together with certain wholly-owned subsidiaries, as guarantors, entered into a seven-year $ 400 million senior secured term loan with UBS AG, Stamford Branch (as successor to Credit Suisse AG, Cayman Island Branch), as the administrative agent and collateral agent, the several other lenders, and the parties named therein on November 6, 2020 (as amended to date, the “Term Loan”). Borrowings under the Term Loan bore interest at Adjusted Term SOFR with a floor of 0.75 % rate plus a margin of 3.75 %. As of May 2, 2026, the weighted average interest rate was 7.53 %, with interest payable monthly. Quarterly principal payments of $ 750.0 thousand are required through September 30, 2027 and borrowings mature on November 6, 2027. As of May 2, 2026, no prepayment was due under the terms and conditions of the Term Loan. Notes On November 6, 2020, Academy, Ltd., issued $ 400 million of 6.00 % senior secured notes which are due November 15, 2027 (the “Notes”), pursuant to an indenture, dated as of November 6, 2020, with the subsidiary guarantors named therein and The Bank of New York Mellon Trust Company, N.A., as trustee and collateral agent. The Notes require cash interest payments semi-annually in arrears on May 15 and November 15 of each year at a rate of 6.00 % per year, which commenced on May 15, 2021. 10 Covenants The ABL Facility, Term Loan and Notes agreements contain covenants, including, among other things, covenants that may restrict Academy, Ltd.'s and certain of the Company’s subsidiaries’ ability to incur certain additional indebtedness, create or permit liens on assets, engage in mergers or consolidations, pay dividends, make other restricted payments, make loans or advances, engage in transactions with affiliates or amend material documents. Additionally, at certain times, the ABL Facility is subject to a minimum adjusted fixed charge coverage ratio. These covenants are subject to certain qualifications and limitations. We were in compliance with these covenants as of May 2, 2026. 5. Fair Value Measurements Fair value is defined as an exit price that would be received from the sale of an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Authoritative guidance establishes a three-level hierarchy for disclosure that is based on the extent and level of judgment used to estimate the fair value of the assets and liabilities. The fair value measurements are classified as either: • Level 1 which represents valuations based on unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; • Level 2 which represents valuations based on quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets and liabilities in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and • Level 3 which represents valuations based on prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (i.e., supported by little or no market activity). In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy in which the fair value measurement is classified in its entirety, is based on the lowest level input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. There were no transfers made into or out of the Level 1, 2 or 3 categories during any period presented. Other Financial Instruments Periodically we make cash investments in money market funds comprised of U.S. Government treasury bills and securities, which are classified as cash and redeemable on demand. As of May 2, 2026, January 31, 2026 and May 3, 2025, we held $ 270.9 million, $ 277.7 million and $ 227.5 million in money market funds, respectively. The fair value of the Term Loan and Notes is estimated using a discounted cash flow analysis based on quoted market prices for the instrument in an inactive market and is therefore classified as Level 2 within the fair value hierarchy. As of May 2, 2026, January 31, 2026, and May 3, 2025, the estimated fair value of the Term Loan and Notes was $ 0.5 billion, $ 0.5 billion and $ 0.5 billion, respectively. As borrowings on the ABL Facility are generally repaid in less than 12 months, we believe that fair value approximates the carrying value. 11 6. Property and Equipment Property and equipment consists of the following (amounts in thousands) as of: May 2, 2026 January 31, 2026 May 3, 2025 Leasehold improvements $ 787,340 $ 777,207 $ 692,337 Equipment and software 794,879 782,547 745,463 Furniture and fixtures 480,128 473,990 439,776 Construction in progress 49,736 29,758 62,099 Building and land 11,964 11,964 16,010 Total property and equipment 2,124,047 2,075,466 1,955,685 Accumulated depreciation and amortization ( 1,521,279 ) ( 1,491,363 ) ( 1,404,501 ) Property and equipment, net $ 602,768 $ 584,103 $ 551,184 Depreciation expense was $ 30.8 million and $ 30.2 million in the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. 7. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following (amounts in thousands) as of: May 2, 2026 January 31, 2026 May 3, 2025 Accrued interest $ 13,393 $ 7,803 $ 13,146 Accrued personnel costs 52,467 55,922 48,418 Accrued professional fees 2,293 2,783 2,989 Accrued sales and use tax 18,731 14,306 17,857 Accrued self-insurance 16,850 17,539 15,818 Deferred revenue - gift cards and other 92,377 102,200 89,426 Income taxes payable 18,102 779 22,412 Property taxes 30,028 19,123 27,413 Sales return allowance 4,700 4,400 4,900 Other 25,916 19,053 29,983 Accrued expenses and other current liabilities $ 274,857 $ 243,908 $ 272,362 8. Share-Based Compensation On September 29, 2020, the ASO, Inc. Board of Directors adopted the 2020 Omnibus Incentive Plan (the “2020 Omnibus Incentive Plan”), which provides for the grant of certain equity incentive awards (each, an “Award”) and became effective on October 1, 2020. The plan reserved a total of 5,150,000 shares of common stock for issuance. On June 1, 2023, our stockholders approved the First Amendment to the 2020 Omnibus Incentive Plan, which, among other changes, increased the number of shares available for issuance thereunder by 2,600,000 shares. As of May 2, 2026, there were 2,932,607 shares that were authorized and available for future issuance under the 2020 Omnibus Incentive Plan. On September 29, 2020, the ASO, Inc. Board of Directors adopted the 2020 Employee Stock Purchase Plan (the “ESPP”), which became effective on October 1, 2020. We have reserved a total of 2,000,000 shares and as of May 2, 2026, there were 1,342,080 shares authorized and available for future issuance under the ESPP. 12 Equity compensation expense was $ 11.1 million and $ 7.5 million for the thirteen weeks ended May 2, 2026 and May 3, 2025, respectively. These costs are included in selling, general and administrative expenses in the Condensed Consolidated Statements of Income. For Award grants during the periods presented, for team members that meet the age and service requirement for retirement eligibility (as defined in the award agreement), such Awards do not require the continued employment of the team member for vesting eligibility. In such cases, expensing of Awards is accelerated through the retirement eligibility date. The following table presents the Award grants during the thirteen weeks ended May 2, 2026: Service Restricted Stock Units Performance Restricted Stock Units Number of shares 588,291 225,083 Weighted average grant date fair value per Award $ 52.10 $ 51.98 Weighted average exercise price per Award N/A N/A The following table presents the unrecognized compensation cost as of May 2, 2026: Service Options Service Restricted Stock Units Performance Restricted Stock Units Remaining expense $ 175,210 $ 47,062,930 $ 10,122,760 Weighted average life remaining in years 0.4 2.2 2.2 9. Earnings per Common Share Basic earnings per common share is calculated based on net income divided by the basic weighted average common shares outstanding during the period, and diluted earnings per common share is calculated based on net income divided by the diluted weighted average common shares outstanding. Diluted weighted average common shares outstanding is based on the basic weighted average common shares outstanding plus any potential dilutive effect of stock-based awards outstanding during the period using the treasury stock method, which assumes the potential proceeds received from the dilutive stock options are used to purchase treasury stock. Anti-dilutive stock-based awards do not include awards which have a performance or liquidity event target which has yet to be achieved. Basic and diluted weighted average common shares outstanding and basic and diluted earnings per common share are calculated as follows (amounts in thousands, except per share amounts): Thirteen Weeks Ended May 2, 2026 May 3, 2025 Net income $ 52,703 $ 46,084 Weighted average common shares outstanding - basic 64,432 67,122 Dilutive effect of Service Restricted Units and Service Restricted Stock Units 359 56 Dilutive effect of Performance Restricted Stock Units — 24 Dilutive effect of Service Options 1,069 891 Dilutive effect of Performance Unit Options 85 77 Dilutive effect of ESPP Shares — — Weighted average common shares outstanding - diluted 65,945 68,170 Earnings per common share - basic $ 0.82 $ 0.69 Earnings per common share - diluted $ 0.80 $ 0.68 Anti-dilutive stock-based awards excluded from diluted calculation 140 264 13 10. Commitments and Contingencies Technology Related and Other Commitments As of May 2, 2026, we have obligations under technology-related, construction and other contractual commitments in the amount of $ 234.3 million. Of such commitments, approximately $ 127.0 million is payable in the next 12 months. Other Contingencies During 2025, the Company entered into an agreement to sell a portion of the rights to potential tariff relief litigation claims, which was determined to be accounted for under ASC 470. As of May 2, 2026, the $ 10.5 million proceeds from the sale are recorded within Other Long-term Liabilities on the Condensed Consolidated Balance Sheets. In February 2026, the Supreme Court issued a ruling striking down certain tariffs previously imposed under the International Emergency Economic Powers Act. As of May 2, 2026, the Company has not recognized a receivable for tariff refund claims or released the $ 10.5 million of proceeds mentioned above from the Condensed Consolidated Balance Sheet, as the refunds were not realized or realizable and remain subject to further legal, regulatory, and administrative developments. To the extent any tariff refunds are realized or realizable, the Company does not expect to receive refunds associated with the portion of rights sold. Financial Guarantees During the normal course of business, we enter into contracts that contain a variety of representations and warranties and provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against us that have not yet occurred. However, based on experience, we believe the risk of loss to be remote. Legal Proceedings We are a defendant or co-defendant in lawsuits, claims and demands brought by various parties relating to matters normally incident to our business. No individual case, or group of cases against us, presenting substantially similar issues of law or fact, is expected to have a material effect on the manner in which we conduct our business or on our consolidated results of operations, financial position or liquidity. The majority of these cases are alleging negligence, and product, premises, employment and/or commercial liability. Reserves have been established that we believe to be adequate based on our current evaluations and experience in these types of claim situations; however, the ultimate outcome of these cases cannot be determined at this time. We believe, taking into consideration our indemnities, defenses, insurance and reserves, the ultimate resolution of these matters will not have a material impact on our financial position, results of operations or cash flows. In addition, government agencies and self-regulatory organizations have the ability to conduct periodic examinations of and administrative proceedings regarding our business. We are not currently party to any legal proceedings that we believe would have a material adverse effect on our financial position, results of operations or cash flows. 11. Segment Information The Company’s retail operations represent one operating segment and one reportable segment, which derives revenues from customers by selling full-line sporting goods and outdoor recreational products. The Company’s retail stores and online selling channels sell similar products and services, use similar selling processes, and sell to similar classes of customers. See Note 1 to the consolidated financial statements for information related to the products and services offered as well as business operations. The accounting policies of the Company’s single reportable segment are the same as those described in the summary of significant accounting policies in Note 2 to the consolidated financial statements. All intercompany transactions within the single reportable segment are eliminated upon consolidation. 14 The Company’s chief operating decision maker (the “CODM”) is the Chief Executive Officer. The CODM allocates resources and assesses performance at a Company level using consolidated net income, which is a GAAP measure, as reported on the Condensed Consolidated Statements of Income. The CODM evaluates the Company's assets as reported on the Company's Condensed Consolidated Balance Sheets. The CODM evaluates significant segment expenses and makes decisions about the retail business based on the cost of goods we sell and the selling, general, and administrative expenses needed to sell those goods as reported on the Condensed Consolidated Statements of Income. See the Company’s consolidated financial statements included in Part I Item 1 for more information. 12. Subsequent Events Our management evaluated events or transactions that occurred after May 2, 2026 through June 10, 2026 (the date the consolidated financial statements were issued), and identified the following events: Debt Refinancing On May 14, 2026, Academy, Ltd., a wholly-owned subsidiary of the Company (the “Issuer”), completed a refinancing transaction that included (i) the issuance of the 2026 Senior Secured Notes (as defined below) and (ii) an amendment to its asset-based revolving credit facility (the “ABL Facility”). The Company used the net proceeds from the 2026 Senior Secured Notes to fully redeem the Notes, repay the Term Loan in full, pay related fees and expenses, and for general corporate purposes. 2026 Senior Secured Notes On May 14, 2026, the Issuer issued $ 500 million aggregate principal amount of its 5.875 % Senior Secured Notes due 2031 (the “2026 Senior Secured Notes”) in a private placement pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended (the “Securities Act”). The 2026 Senior Secured Notes are secured by first-priority liens on substantially all personal property of the Issuer and the guarantors (other than ABL Priority Collateral (as defined in the ABL Amendment, see below)) and by second-priority liens on ABL Priority Collateral, in each case subject to permitted liens. The 2026 Senior Secured Notes are governed by an Indenture, dated as of May 14, 2026 (the “Indenture”) among the Issuer, the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee. The 2026 Senior Secured Notes will mature on May 15, 2031. Interest on the 2026 Senior Secured Notes is payable semi-annually in arrears on November 15 and May 15 of each year, beginning on November 15, 2026. The 2026 Senior Secured Notes are redeemable, at Issuer’s option, prior to maturity at customary redemption prices (including “make-whole” provisions prior to May 15, 2028) and, thereafter, at the declining redemption prices set forth below, in each case plus accrued and unpaid interest. The Issuer may also redeem up to 40 % of the aggregate principal amount of the 2026 Senior Secured Notes prior to May 15, 2028 with proceeds of certain equity offerings, as described in the Indenture. Percentage 2028 102.938 % 2029 101.469 % 2030 and thereafter 100.000 % Upon the occurrence of certain events constituting a Change of Control (as defined in the Indenture), the Issuer must offer to repurchase the 2026 Senior Secured Notes at 101 % of the principal amount, plus accrued and unpaid interest. The Indenture contains certain covenants that, among other things, restrict the ability of the Issuer and its restricted subsidiaries to: (i) incur or guarantee additional indebtedness; (ii) incur liens on assets; (iii) make restricted payments; (iv) prepay certain debt; (v) make investments; (vi) enter into affiliate transactions; (vii) restrict subsidiaries distributions/dividends; and (viii) sell or transfer certain assets or merge or consolidate, in each case subject to customary exceptions and qualifications as set forth in the Indenture. 15 ABL Amendment On May 14, 2026, the Issuer, as borrower, New Academy Holding Company, LLC, Associated Investors, L.L.C., Academy Managing Co., L.L.C., and Academy Procurement Co., LLC, each a direct or indirect, wholly-owned subsidiary of the Company, as guarantors, entered into an amendment (the “ABL Amendment”) to the ABL Facility, which the ABL Amendment, among other things (i) extended the maturity of the ABL Facility to May 14, 2031, (ii) modified the Average Excess Availability (as defined in the ABL Facility) pricing grid used in determining the interest rate margin on borrowings under the ABL Facility, (iii) modified the Commitment Fee Rate (as defined in the ABL Facility), when the Average Excess Availability is greater than or equal to 50 % of the Maximum Borrowing Amount (as defined in the ABL Facility) and (iv) so long as the 2026 Senior Secured Notes are outstanding and mature on or prior to the latest maturity date of the ABL Facility, permits the agent under the ABL Facility to take a reserve against the ABL Facility equal to the aggregate principal amount of the 2026 Senior Secured Notes in excess of $ 100 million outstanding on the date that is ninety-one ( 91 ) days prior to the latest maturity date of the ABL Facility. 2020 Notes On May 14, 2026, the Issuer used the net proceeds from the 2026 Senior Secured Notes to fund the redemption of all of its outstanding 6.00 % senior secured notes due November 15, 2027 of $ 400 million. 2020 Term Loan On May 14, 2026, the Issuer voluntarily prepaid all outstanding amounts owed under the Term Loan of $ 85 million. As a result, all related guarantees and liens were released. Quarterly Dividend On June 4, 2026, the Company's Board of Directors declared a quarterly cash dividend with respect to the fiscal quarter ended May 2, 2026, of $ 0.15 per share of the Company's common stock, payable on July 16, 2026, to stockholders of record as of the close of business on June 18, 2026. 16