What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-09-09 compared with 2026-06-10 · 142 added, 85 removed, 330 unchanged (41% of the section changed)

12 unchanged sentences

We believe that these factors include but are not limited to those described under the section entitled “Risk Factors” in the Company’s Annual Report, as such risk factors may be updated from time to time in our periodic filings with the Securities and Exchange Commission, or SEC, and are accessible on the SEC's website at www.sec.gov.

Any forward-looking statement made by us in this Quarterly Report speaks only as of the date of this Quarterly Report and are expressly qualified in their entirety by the cautionary statements included in this Quarterly Report.

Any forward-looking statement made by us in this Quarterly Report speaks only as of the date of this Quarterly Report and is expressly qualified in its entirety by the cautionary statements included in this Quarterly Report.

Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them.

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• overall decline in the health of the economy and consumer discretionary spending;

• risks associated with our reliance on internationally manufactured merchandise which exposes us to various international risks, including additional tariffs;

• risks associated with our reliance on internationally manufactured merchandise which exposes us to various international risks, including additional tariffs or changes to existing tariffs;

• our ability to operate, update or implement our information systems;

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Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, our actual results may vary in material respects from those projected in these forward-looking statements.

The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited financial statements and related notes included elsewhere in this Quarterly Report for the thirteen weeks ended May 2, 2026 and our audited financial statements for the fiscal year ended January 31, 2026 and the section entitled “Management's Discussion and Analysis of Financial Condition and Results of Operations” included in the Annual Report.

The following discussion and analysis of our financial condition and results of operations should be read together with our unaudited financial statements and related notes included elsewhere in this Quarterly Report for the thirteen and twenty-six weeks ended August 1, 2026 and our audited financial statements for the fiscal year ended January 31, 2026 and the section entitled “Management's Discussion and Analysis of Financial Condition and Results of Operations” included in the Annual Report.

All references to “Academy,” “Academy Sports + Outdoors,” “ASO, Inc.,” “we,” “us,” “our” or the “Company” in this Quarterly Report refer to Academy Sports and Outdoors, Inc., a Delaware corporation and the current parent holding company of our operations, and its consolidated subsidiaries.

We conduct our operations primarily through our 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 lessee of facilities.

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 lessee of facilities.

We operate on a retail fiscal calendar pursuant to which our fiscal year consists of 52 or 53 weeks, ending on the Saturday closest to January 31 (which such Saturday may occur on a date following January 31) each year.

References to any year, quarter, or month mean our fiscal year, fiscal quarter, and fiscal month, respectively, unless the context requires otherwise.

References to the “current quarter,” “2026 first quarter,” or similar reference refers to the thirteen week period ended May 2, 2026, and any reference to the “prior year quarter,” “2025 first quarter” or similar reference refers to the thirteen week period ended May 3, 2025.

References to the “current quarter,” “2026 second quarter,” or similar reference refers to the thirteen week period ended August 1, 2026, and any reference to the “prior year quarter,” “2025 second quarter” or similar reference refers to the thirteen week period ended August 2, 2025.

Unless otherwise specified, all comparisons regarding the current period of 2026 are made to the corresponding period of 2025.

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Our mission is to provide “Fun for All”, and we fulfill this mission with a localized merchandising strategy and value proposition that deeply connect with a broad range of consumers.

Our product assortment focuses on key categories of outdoor, sports and recreation, apparel, and footwear (representing 30%, 25%, 24%, and 21% of our 2026 first quarter net sales, respectively) through both leading national brands and a portfolio of private label brands, which go well beyond traditional sporting goods and apparel offerings.

Our product assortment focuses on key categories of outdoor, apparel, sports and recreation, and footwear (representing 29%, 28%, 24%, and 19% of our 2026 second quarter net sales, respectively) through both leading national brands and a portfolio of private label brands, which go well beyond traditional sporting goods and apparel offerings.

We sell a range of sporting and outdoor recreation products, including sporting equipment, apparel, footwear, camping gear, patio furniture, outdoor cooking equipment, and hunting and fishing gear, among many others.

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We provide locally relevant offerings, such as crawfish boilers in Louisiana, licensed apparel for area sports fans, baits and lures for area fishing spots, and beach towels in coastal markets.

As of May 2, 2026, we operated 324 stores that range in size from approximately 40,000 to 130,000 gross square feet, with an average size of approximately 70,000 gross square feet, throughout 21 contiguous states located primarily in the southern United States.

As of August 1, 2026, we operated 327 stores that range in size from approximately 40,000 to 130,000 gross square feet, with an average size of approximately 70,000 gross square feet, throughout 21 contiguous states located primarily in the southern United States.

Our stores are supported by approximately 22,000 team members, three distribution centers, and our e-commerce platform, which includes our website at www.academy.com and our mobile app.

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The following table summarizes store activity for the periods indicated:

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025

Beginning stores 322 298

Q1 new stores 2 5

Q2 new stores 3 3

Ending stores 327 306

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The impact of the evolving macroeconomic environment on our financial results is uncertain.

We have worked diligently to mitigate the impact of tariffs on our business.

We are closely monitoring the evolving environment with respect to tariffs and other trade policy developments and will continue to adjust plans as needed, including, but not limited to, inventory purchase quantities and timing, strategic pricing and promotional adjustments to maintain value for our customers, diversifying sourcing to shift country of origin, and vendor negotiations.

We are closely monitoring the evolving environment with respect to tariffs and other trade policy developments and will continue to adjust plans as needed, including, but not limited to, appropriate sourcing diversification, strategic pricing and promotional adjustments to maintain value for our customers, and other operational decisions to manage the impact of tariffs on our business.

How We Assess the Performance of Our Business

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Comparable Sales.

Comparable sales include stores open after thirteen full fiscal months as well as all e-commerce sales.

Comparable sales include stores open after thirteen full fiscal months, all e-commerce sales, and credit card revenue.

There may be variations in the way in which some of our competitors and other retailers calculate comparable sales.

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Stores which have been closed for an extended period of time are removed from the calculation.

E-commerce sales include omni-channel sales fulfilled by our stores.

For example, all buy-online-pickup-in-store (“BOPIS”) transactions are allocated to e-commerce sales for the purpose of comparable sales, despite the fact that our customers pick-up these purchases from a specific store.

E-commerce sales include omnichannel sales fulfilled by our stores.

For example, all buy-online-pick up-in-store (“BOPIS”) transactions are allocated to e-commerce sales for the purpose of comparable sales, despite the fact that our customers pick up these purchases from a specific store.

Increases or decreases in e-commerce between periods being compared directly impact the comparable sales results.

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Our e-commerce platform supports store operations by driving customer demand, providing real-time product discovery and inventory visibility, and enabling store-fulfilled transactions such as BOPIS, ship-to-store, and ship-from-store.

During the 2026 first quarter, stores facilitated approximately 95% of our total sales, including ship-from-store, BOPIS and in-store retail sales.

During the 2026 year-to-date second quarter, stores facilitated approximately 95% of our total sales, including ship-from-store, BOPIS and in-store retail sales.

We expect to continue investing in the expansion and enhancement of our omnichannel capabilities, including our mobile application, website experience optimization, fulfillment improvements, and emerging digital commerce capabilities such as artificial intelligence-enabled shopping experiences and social and marketplace commerce integrations.

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We utilize comprehensive demographic and trade data to guide our real estate site selection.

During the 2026 first quarter, we opened two new stores.

During the 2026 second quarter, we opened three new stores.

Our strategic real estate approach, including the 68 stores opened since fiscal year 2021, has positioned us effectively for continued expansion.

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These expenses are both variable and fixed in nature.

SG&A expenses as a percentage of sales decreased from 28.8% in the 2025 first quarter to 28.1% in the 2026 first quarter.

This decrease was a result of increased sales and ongoing expense discipline across the organization in addition to lapping the Jordan Brand launch in the 2025 first quarter.

SG&A expenses as a percentage of sales decreased from 26.9% in the 2025 year-to-date second quarter to 26.7% in the 2026 year-to-date second quarter.

This decrease was a result of increased sales and ongoing expense discipline across the organization.

We track and measure operating expenses as a percentage of net sales in order to evaluate our performance against profitability targets.

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The following table summarizes our pre-opening expense activity for the periods presented:

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

Thirteen Weeks Ended Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025 August 1, 2026 August 2, 2025

Number of new stores opened 3 3 5 8

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Interest Expense.

Interest expense includes regular interest payable related to our Term Loan, Notes and ABL Facility (see Note 4 to the accompanying financial statements) and the amortization of our deferred loan costs and original issuance discounts associated with the acquisition of the debt.

Interest expense includes regular interest payable related to our Notes, ABL Facility, and Term Loan (see Note 4 to the accompanying financial statements) and the amortization of our deferred loan costs and original issuance discounts associated with the acquisition of the debt.

During the second quarter of 2026, Academy, Ltd.

issued $500 million aggregate principal amount of its 5.875% Senior Secured Notes due 2031 (the “Notes”).

We used the proceeds from the Notes to redeem the 2020 Notes and voluntarily prepay the Term Loan in full (see Note 4).

This pay down resulted in decreased interest expense in year-to-date 2026 as compared to the prior year period, and we anticipate it will result in decreased interest expense compared to 2025 throughout the remainder of 2026.

Income Tax Expense.

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federal, state, and local income tax purposes and accordingly, a provision for income taxes has been recorded for the anticipated tax consequences of our reported results of operations for federal, state and local income taxes.

Recent fluctuations in income tax expense have been primarily as a result of changes in income before income taxes and the effect of cross border tax laws.

Recent fluctuations in income tax expense have been primarily as a result of the purchase of transferable tax credits, the effect of cross-border tax laws, and changes in income before income taxes.

Results of Operations

Thirteen Weeks Ended May 2, 2026 Compared to Thirteen Weeks Ended May 3, 2025

Thirteen Weeks Ended August 1, 2026 Compared to Thirteen Weeks Ended August 2, 2025

The following table sets forth amounts and information derived from our unaudited statements of income for the periods indicated as follows (dollar amounts in thousands):

Thirteen Weeks Ended Change

May 2, 2026 May 3, 2025 Dollars Percent

August 1, 2026 August 2, 2025 Dollars Percent

Net sales $ 1,647,285 100.0 % $ 1,599,838 100.0 % $ 47,447 3.0 %

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Interest expense, net 8,056 0.5 % 9,028 0.6 % (972) (10.8) %

Other income, net 3,222 0.2 % 2,807 0.2 % 415 14.8 %

Loss on early retirement of debt 1,902 0.1 % — — % 1,902 NM

Other expense (income), net 58,006 3.5 % (1,480) (0.1) % 59,486 NM

Income before income taxes 178,399 10.8 % 164,833 10.3 % 13,566 8.2 %

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*Percentages in table may not sum properly due to rounding.

Net sales increased $90.6 million, or 6.7%, in the 2026 first quarter compared to the prior year first quarter, which was driven by increased sales of 11.7% in the outdoor merchandise division, 6.2% in the sports and recreation merchandise division, 4.7% in the apparel merchandise division and 2.8% in the footwear merchandise division.

We opened 21 new stores since the end of the 2025 first quarter, two of which opened during the 2026 first quarter.

During the 2026 first quarter, these 21 stores generated $54.5 million of net sales, including e-commerce.

Net sales increased $47.4 million, or 3.0%, in the 2026 second quarter compared to the prior year second quarter, which was driven by increased sales of 6.3% in the sports and recreation merchandise division and 4.4% in the outdoor merchandise division, partially offset by decreased sales of 1.0% in the footwear merchandise division while the apparel merchandise division remained relatively constant.

We opened 21 new stores since the end of the 2025 second quarter, three of which opened during the 2026 second quarter.

During the 2026 second quarter, these 21 stores generated $61.5 million of net sales, including e-commerce.

Since re-launching our new store program in 2022, we have opened 68 new stores, 47 of which have been open for at least twelve months.

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We believe that performance of new stores in year one is partially affected by the season in which the new store opens and the brand awareness in the region the new store opens.

Comparable sales increased 2.9% driven by higher comparable sales across all merchandise divisions, except the footwear merchandise division which remained relatively constant.

Comparable sales decreased 0.4% driven by lower comparable sales in the footwear and apparel merchandise divisions, partially offset by higher comparable sales in the sports and recreation and outdoor merchandise divisions.

The decrease in comparable sales was a result of a 5.3% decrease in comparable transactions, partially offset by an increase in average ticket of 4.9%.

E-commerce net sales represented 12.1% of merchandise sales for the 2026 second quarter compared to 10.9% for the prior year second quarter.

E-commerce net sales increased 14.1% in the 2026 second quarter over the prior year second quarter.

Gross Margin.

Gross margin increased $89.2 million, or 15.5%, to $665.9 million in the 2026 second quarter from $576.7 million in the 2025 second quarter.

As a percentage of net sales, gross margin increased 440 basis points from 36.0% in the 2025 second quarter to 40.4% in the 2026 second quarter.

The increase of 440 basis points in gross margin was primarily attributable to 510 basis points of favorability from the one-time benefit of IEEPA tariff refunds and 20 basis points of favorability related to shrink, partially offset by 90 basis points of unfavorability in merchandise margin, inclusive of 70 basis points of reinvestment of tariff refunds into strategic pricing.

Selling, General and Administrative Expenses.

SG&A expenses increased $15.2 million, or 3.8%, to $419.5 million in the 2026 second quarter as compared to $404.4 million in the 2025 second quarter, primarily as a result of our increased strategic investments of $19.1 million, including the addition of 21 new stores since the end of the 2025 second quarter, partially offset by $3.9 million improvement in base costs.

Interest Expense.

Interest expense decreased $1.0 million, or 10.8%, in the 2026 second quarter when compared with the 2025 second quarter, primarily due to lower interest rates and debt refinancing activities in the 2026 second quarter which resulted in lower interest rates on our long-term debt (see Note 4).

Loss on Early Retirement of Debt.

Loss on early retirement of debt increased by $1.9 million in the 2026 second quarter as compared to the 2025 second quarter.

During the second quarter of 2026, we completed refinancing transactions and used the net proceeds from the issuance of the Notes to fully redeem the 2020 Notes and repay our Term Loan in full (as defined in Note 4), which resulted in a $1.9 million loss on early retirement of debt.

Other Expense (Income), net.

Other expense (income), net, changed by $59.5 million in the 2026 second quarter as compared to the 2025 second quarter, primarily driven by $72.2 million of payments made related to the Participation Agreement for tariff relief claims, partially offset by the $10.5 million in proceeds recognized related to the Participation Agreement (see Note 10).

Income Tax Expense.

Income tax expense increased $1.1 million to $40.5 million for the 2026 second quarter as compared to $39.4 million in the 2025 second quarter, resulting primarily from an increase in pre-tax income.

ASO, Inc.’s effective tax rate was 22.7% in the second quarter of 2026 compared to 23.9% in the second quarter of 2025.

The decrease in the effective tax rate compared to the prior year quarter is primarily due to the purchase of transferable tax credits and the effect of cross-border tax laws.

Twenty-Six Weeks Ended August 1, 2026 Compared to Twenty-Six Weeks Ended August 2, 2025

Twenty-Six Weeks Ended Change

August 1, 2026 August 2, 2025 Dollars Percent

Net sales $ 3,089,288 100.0 % $ 2,951,247 100.0 % $ 138,041 4.7 %

Cost of goods sold 1,944,038 62.9 % 1,915,645 64.9 % 28,393 1.5 %

Gross margin 1,145,250 37.1 % 1,035,602 35.1 % 109,648 10.6 %

Selling, general and administrative expenses 824,232 26.7 % 793,956 26.9 % 30,276 3.8 %

Operating income 321,018 10.4 % 241,646 8.2 % 79,372 32.8 %

Interest expense, net 17,043 0.6 % 18,072 0.6 % (1,029) (5.7) %

Loss on early retirement of debt 1,902 0.1 % — — % 1,902 NM

Other expense (income), net 54,785 1.8 % (4,287) (0.1) % 59,072 NM

Income before income taxes 247,288 8.0 % 227,861 7.7 % 19,427 8.5 %

Income tax expense 56,688 1.8 % 56,343 1.9 % 345 0.6 %

Net income $ 190,600 6.2 % $ 171,518 5.8 % $ 19,082 11.1 %

*Percentages in table may not sum properly due to rounding.

Net sales increased $138.0 million, or 4.7%, year-to-date 2026 compared to year-to-date 2025, which was driven by increased sales of 7.8% in the outdoor merchandise division, 6.3% in the sports and recreation merchandise division, 2.1% in the apparel merchandise division and 0.8% in the footwear merchandise division.

We opened 21 new stores since the end of the 2025 second quarter, three of which opened during the 2026 second quarter.

During the year-to-date 2026, these 21 stores generated $108.9 million of net sales, including e-commerce.

Since re-launching our new store program in 2022, we have opened 68 new stores, 47 of which have been open for at least twelve months.

Over the last twelve months, those 47 stores have averaged approximately $13 million in net sales per store, including e-commerce.

We believe that performance of new stores in year one is partially affected by the season in which the new store opens and the brand awareness in the region the new store opens.

Comparable sales increased 1.1% driven by higher comparable sales in the outdoor and sports and recreation merchandise divisions, partially offset by lower comparable sales in the footwear and apparel merchandise divisions.

The increase in comparable sales was a result of a 4.7% increase in average ticket, partially offset by a decrease in comparable transactions of 3.6%.

E-commerce net sales represented 11.0% of merchandise sales for the 2026 first quarter compared to 10.0% for the prior year first quarter.

E-commerce net sales increased 17.4% in the 2026 first quarter over the prior year first quarter.

E-commerce net sales represented 11.6% of merchandise sales for the year-to-date 2026 compared to 10.5% for the year-to-date 2025.

E-commerce net sales increased 15.5% year-to-date 2026 compared to year-to-date 2025.

Gross Margin.

Gross margin increased $20.5 million, or 4.5%, to $479.3 million in the 2026 first quarter from $458.9 million in the 2025 first quarter.

As a percentage of net sales, gross margin decreased 80 basis points from 34.0% in the 2025 first quarter to 33.2% in the 2026 first quarter.

The decrease of 80 basis points in gross margin was primarily attributable to 110 basis points of unfavorability as a result of tariffs, partially offset by 20 basis points of favorability related to shrink and 10 basis points of favorability related to freight and e-commerce shipping.

Gross margin increased $109.6 million, or 10.6%, to $1,145.3 million for the year-to-date 2026 from $1,035.6 million for the year-to-date 2025.

As a percentage of net sales, gross margin increased 200 basis points from 35.1% for the year-to-date 2025 to 37.1% for the year-to-date 2026.

The increase of 200 basis points in gross margin was primarily attributable to 270 basis points of favorability from the one-time benefit of IEEPA tariff refunds, 20 basis points of favorability related to shrink, and 20 basis points of favorability related to decreased freight, partially offset by 120 basis points of unfavorability in merchandise margin primarily as a result of tariffs and the reinvestment of tariff refunds into strategic pricing.

Selling, General and Administrative Expenses.

SG&A expenses increased $15.1 million, or 3.9%, to $404.7 million in the 2026 first quarter as compared to $389.6 million in the 2025 first quarter, primarily as a result of our increased strategic investments of $19.0 million in new stores and technology, partially offset by $7.5 million due to lapping the Jordan Brand launch in the 2025 first quarter.

SG&A expenses increased $30.3 million, or 3.8%, to $824.2 million for the year-to-date 2026 as compared to $794.0 million for the year-to-date 2025, primarily as a result of our increased strategic investments of $40.0 million in new stores and technology, partially offset by $7.5 million due to lapping the Jordan Brand launch in the 2025 first quarter.

Interest Expense.

Interest expense remained relatively constant in the 2026 first quarter when compared with the 2025 first quarter.

Other Income, net.

Other income, net, increased $0.4 million in the 2026 first quarter when compared with the 2025 first quarter, primarily driven by higher money market investments in the 2026 first quarter when compared with the 2025 first quarter.

Interest expense decreased $1.0 million, or 5.7%, for the year-to-date 2026 when compared with the year-to-date 2025, primarily due to lower interest rates and debt refinancing activities in the 2026 second quarter which resulted in lower interest rates on our long-term debt (see Note 4).

Loss on Early Retirement of Debt.

Loss on early retirement of debt increased $1.9 million for the year-to-date 2026 when compared with the year-to-date 2025.

Other Expense (Income), net.

Other expense (income), net, changed by $59.1 million in year-to-date 2026 when compared to year-to-date 2025, primarily driven by $72.2 million of payments made related to the Participation Agreement for tariff relief claims, partially offset by the $10.5 million in proceeds recognized related to the Participation Agreement (see Note 10).

Income Tax Expense.

Income tax expense decreased $0.8 million to $16.2 million for the 2026 first quarter as compared to $16.9 million in the 2025 first quarter, resulting primarily from fluctuations in share-based compensation deductions.

ASO, Inc.’s effective tax rate was 23.5% in the first quarter of 2026 compared to 26.9% in the first quarter of 2025.

The decrease in the effective tax rate compared to the prior year quarter is primarily due to fluctuations in share-based compensation deductions.

Income tax expense remained relatively constant for the year-to-date 2026 as compared to the year-to-date 2025.

ASO, Inc.’s effective tax rate was 22.9% for the year-to-date 2026 compared to 24.7% for the year-to-date 2025.

The decrease in the effective tax rate compared to the prior year is primarily due to an increase in excess tax benefits for share-based compensation.

Non-GAAP Measures

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The following table provides reconciliations of net income to Adjusted EBIT for the periods presented (amounts in thousands):

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

Thirteen Weeks Ended Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025 August 1, 2026 August 2, 2025

Net income $ 137,897 $ 125,434 $ 190,600 $ 171,518

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Equity compensation (a) 9,319 7,602 20,419 15,144

Loss on early retirement of debt 1,902 — 1,902 —

Adjusted EBIT $ 197,676 $ 181,463 $ 286,652 $ 261,077

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The following table provides a reconciliation of net income to Adjusted Net Income and Adjusted Earnings per Share for the periods presented (amounts in thousands, except per share data):

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

Thirteen Weeks Ended Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025 August 1, 2026 August 2, 2025

Net income $ 137,897 $ 125,434 $ 190,600 $ 171,518

Equity compensation (a) 9,319 7,602 20,419 15,144

Loss on early retirement of debt 1,902 — 1,902 —

Tax effects of these adjustments (b) (2,612) (1,717) (5,196) (3,745)

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The following table provides a reconciliation of net cash provided by operating activities to Adjusted Free Cash Flow for the periods presented (amounts in thousands):

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

Net cash provided by operating activities $ 160,606 $ 157,472

Thirteen Weeks Ended Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025 August 1, 2026 August 2, 2025

Net cash provided by operating activities (a) $ 188,416 $ 78,575 $ 349,022 $ 236,047

Net cash used in investing activities (72,467) (56,911) (111,464) (107,899)

Adjusted Free Cash Flow $ 115,949 $ 21,664 $ 237,558 $ 128,148

Net cash provided by operating activities includes the impact of IEEPA tariff refunds in the 2026 second quarter (see Note 10).

Liquidity and Capital Resources

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We fund these liquidity requirements through cash and cash equivalents, cash generated from operating activities, issuances of debt (such as the Notes) and borrowings under our ABL Facility.

On May 2, 2026, our cash and cash equivalents totaled $337.8 million.

On August 1, 2026, our cash and cash equivalents totaled $298.2 million.

We believe our cash and cash equivalents, as well as our availability under the ABL Facility, will be sufficient to fund our cash requirements for the next 12 months and the longer term foreseeable future.

Long-Term Debt

As of May 2, 2026, the Company’s long-term debt and interest rates consist of:

• Notes - 6.00% fixed rate senior secured notes with $400 million in principal outstanding and full principal maturing November 15, 2027;

• Term Loan - 7.53% variable rate term-loan with $85.0 million in principal outstanding maturing November 6, 2027 and requiring quarterly principal payments of $750 thousand through September 30, 2027;

• ABL Facility - $1.0 billion commitment on a variable rate secured asset-based revolving credit facility with no principal outstanding maturing March 8, 2029.

As of August 1, 2026, the Company’s long-term debt and interest rates consist of:

• Notes - 5.875% fixed rate senior secured notes (the “Notes”) with $500 million in principal outstanding and full principal maturing May 15, 2031;

• ABL Facility - $1.0 billion commitment on a variable rate secured asset-based revolving credit facility with no principal outstanding maturing May 14, 2031.

On May 14, 2026, Academy, Ltd., a wholly-owned subsidiary of the Company, entered into an amendment to the ABL Facility which, among other things, extended the maturity of the ABL Facility to May 14, 2031, and Academy, Ltd., as issuer, issued $500 million in aggregate principal amount of senior secured notes, all of which remains outstanding and matures on May 15, 2031.

The Company used the net proceeds from the senior secured notes to fully redeem the Notes, repay the Term Loan in full, pay related fees and expenses, and for general corporate purposes.

See Notes 4 and 12 to the accompanying financial statements for further disclosure regarding our debt agreements.

The following table summarizes our debt obligations by fiscal year as of May 2, 2026 (amounts in thousands):

2026 2027 2028 2029 2030 Total

Term Loan and related interest (1)

$ 6,848 $ 87,725 $ — $ — $ — $ 94,573

The Company used the net proceeds from the Notes to fully redeem the 2020 Notes, prepay the Term Loan in full, pay related fees and expenses, and for general corporate purposes.

See Note 4 to the accompanying financial statements for further disclosure regarding our debt agreements.

The following table summarizes our debt obligations by fiscal year as of August 1, 2026 (amounts in thousands):

2026 2027 2028 2029 2030 After 2030 Total

Notes and related interest (1)

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1,488 3,000 3,000 3,000 3,000 832 14,320

(1) Interest payments do not include amortization of discount and debt issuance costs and are approximated based on projected interest rates and assume no unscheduled principal payments.

(1) Interest payments do not include amortization of debt issuance costs and assumes Notes are paid in full at maturity date.

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Liquidity information related to the ABL Facility is as follows for the periods shown (dollar amounts in thousands):

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025

Average funds drawn $ — $ —

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Liquidity information related to the ABL Facility (amounts in thousands) as of:

May 2, 2026 January 31, 2026 May 3, 2025

August 1, 2026 January 31, 2026 August 2, 2025

Outstanding borrowings $ — $ — $ —

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We predominantly lease store locations, distribution centers, office space and certain equipment under operating leases expiring between fiscal years 2026 and 2046.

Operating lease obligations include future minimum lease payments under all of our non-cancelable operating leases at May 2, 2026.

Operating lease obligations include future minimum lease payments under all of our non-cancelable operating leases at August 1, 2026.

The following table summarizes our remaining operating lease obligations by fiscal year:

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(1) Minimum lease payments have not been reduced by sublease rentals of $1.2 million due in the future under non-cancelable sub-leases.

(2) These balances include stores where we have an executed contract but have not taken possession of the location as of May 2, 2026.

(2) These balances include stores where we have an executed contract but have not taken possession of the location as of August 1, 2026.

Share Repurchases

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The 2024 Share Repurchase Program does not obligate the Company to acquire any particular number of common shares, and the program may be suspended, extended, modified or discontinued at any time.

As of May 2, 2026, the Company had $338.2 million remaining for share repurchases under the 2024 Share Repurchase Program.

As of August 1, 2026, the Company had $256.1 million remaining for share repurchases under the 2024 Share Repurchase Program.

See Note 2 to the consolidated financial statements.

The following table summarizes our share repurchases for the 2026 first quarter (dollar amounts in thousands, except per share amounts):

The following table summarizes our share repurchases through the 2026 second quarter (dollar amounts in thousands, except per share amounts):

Total Number of Shares Purchased Average Price Paid per Share (1)

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First Quarter (February 1, 2026 to May 2, 2026) 1,703,031 $ 57.79 $ 98,412

Second Quarter (May 3, 2026 to August 1, 2026) (2)

1,608,528 51.04 82,093

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(1) Excludes the impact of unpaid excise taxes.

(2) See Part II, Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds for further detail on the 2026 first quarter share repurchases.

The following table summarizes our quarterly dividend payments for the 2026 first quarter (amounts in thousands, except per share amounts):

(2) See Part II, Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds for further detail on the 2026 second quarter share repurchases.

The following table summarizes our quarterly dividend payments for the 2026 second quarter (amounts in thousands, except per share amounts):

Dividend per Share Total Dividends Paid Stockholder Date of Record

First Quarter (February 1, 2026 to May 2, 2026) $ 0.15 $ 9,646 March 20, 2026

Second Quarter (May 3, 2026 to August 1, 2026) 0.15 9,310 June 18, 2026

Total Dividends Paid $ 18,956

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.

On September 2, 2026, the Company’s Board of Directors declared a quarterly cash dividend with respect to the fiscal quarter ended August 1, 2026, of $0.15 per share of the Company's common stock, payable on October 14, 2026, to stockholders of record as of the close of business on September 16, 2026.

Capital Expenditures

The following table summarizes our capital expenditures for the thirteen weeks ended May 2, 2026 and May 3, 2025 (amounts in thousands):

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

The following table summarizes our capital expenditures for the twenty-six weeks ended August 1, 2026 and August 2, 2025 (amounts in thousands):

Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025

New stores $ 60,085 $ 49,368

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We review forecasted capital expenditures throughout the year and will adjust our capital expenditures based on business conditions at that time.

Cash Flows for the Thirteen Weeks Ended May 2, 2026 and May 3, 2025

Cash Flows for the Twenty-Six Weeks Ended August 1, 2026 and August 2, 2025

Our unaudited statements of cash flows are summarized as follows (in thousands):

Thirteen Weeks Ended

May 2, 2026 May 3, 2025

Twenty-Six Weeks Ended

August 1, 2026 August 2, 2025

Net cash provided by operating activities $ 349,022 $ 236,047

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Net cash used in financing activities (269,665) (116,217)

Net increase (decrease) in cash and cash equivalents $ 7,490 $ (3,825)

Net (decrease) increase in cash and cash equivalents $ (32,107) $ 11,931

Operating Activities.

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Typically, cash flows from operations are used to build inventory in advance of peak selling seasons, with the fourth quarter pre-holiday season inventory increase being the most significant.

Cash provided by operating activities in the 2026 first quarter increased $3.1 million, compared to 2025 first quarter.

Cash provided by operating activities in year-to-date 2026 increased $113.0 million, compared to year-to-date 2025.

This increase is attributable to:

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• $68.6 million net increase in cash flows provided by operating assets and liabilities;

• $5.9 million net decrease in non-cash charges.

• $25.3 million net increase in non-cash charges primarily due to $61.8 million related to the loss on the IEEPA tariff refund monetization in the 2026 second quarter (see Note 5 and Note 10), partially offset by a $28.8 million decrease in deferred income taxes.

The increase in cash flows from operating assets and liabilities was primarily attributable to:

• $62.7 million increase in cash flows from working capital due to the pull-forward of inventory purchases in the prior year period at pre-tariff rates;

• $17.2 million increase in accounts receivable due to timing of payments received;

• $39.5 million increase in income taxes payable primarily due to deductions in the prior year period resulting from the One Big Beautiful Bill Act, timing of payments, and a tax refund received in the prior year period;

partially offset by

• $34.3 million decrease in prepaid expenses and other current assets largely driven by litigation settlements received in the prior year period and timing of construction reimbursement payments received.

• $12.1 million decrease in accrued expenses and other current liabilities primarily due to an increase in accrued sales and use tax as a result of increased sales;

• $7.9 million decrease in other long-term liabilities primarily due to payments for deferred contract proceeds received in the 2025 first quarter.

Investing Activities .

Cash used in investing activities decreased $12.0 million in the 2026 first quarter compared to the 2025 first quarter.

This decrease is primarily due to decreased capital expenditures for new stores as well as corporate, e-commerce, and information technology programs in the 2026 first quarter compared to the 2025 first quarter.

Cash used in investing activities increased $3.6 million in year-to-date 2026 compared to the year-to-date 2025.

This increase is primarily due to increased capital expenditures for new stores as well as corporate, e-commerce, and information technology programs, partially offset by a decrease in capital expenditures for existing stores and distribution centers in year-to-date 2026 compared to the year-to-date 2025.

Financing Activities .

Cash used in financing activities increased $3.8 million in the 2026 first quarter, compared to the 2025 first quarter, primarily due to a $2.7 million increase in cash payments for minimum tax withholding requirements as a result of the vesting of employee equity awards compared to the prior year period.

Cash used in financing activities increased $153.4 million in year-to-date 2026, compared to year-to-date 2025.

The increase in financing activities was primarily attributable to:

• $484.3 million increase in cash outflows related to the redemption of the 2020 Notes and repayment of the Term Loan as part of the refinancing activities in the 2026 second quarter (see Note 4);

• $81.5 million increase in cash outflows for repurchases of common stock in 2026;

• $72.2 million increase in cash outflows due to payments made related to the Participation Agreement for tariff relief claims (see Note 10);

partially offset by

• $493.9 million in net proceeds resulting from the issuance of the Notes as part of the refinancing activities in the 2026 second quarter (see Note 4).

Critical Accounting Policies and Estimates

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis