What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-06-17 compared with 2024-06-17 · 180 added, 192 removed, 1049 unchanged (26% of the section changed)

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Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of April 26, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company changed the manner in which it classifies certain costs associated with its distribution centers.

Basis for Opinions

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A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the

and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

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The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Accrued Product Warranties for the Wholesale Reportable Segment

As described in Note 12 to the consolidated financial statements, as of April 27, 2024, the Company’s consolidated accrued product warranties liability balance was $28.9 million, of which the Wholesale reportable segment comprises a significant portion.

Management accrues an estimated liability for product warranties when revenue is recognized on the sale of warrantied products.

Management estimates future warranty claims on product sales based on sales volume and historical claims experience and periodically adjusts the provision to reflect changes in actual experience.

The liability estimate incorporates repair costs, including materials, labor and overhead amounts necessary to perform repairs, and any costs associated with delivering the repaired product to customers.

The principal considerations for our determination that performing procedures relating to the accrued product warranties for the Wholesale reportable segment is a critical audit matter are (i) the significant judgment by management when developing the accrual and (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures relating to the estimation methodology and the applicability of historical cost of materials and labor used in the methodology.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the accrued product warranties for the Wholesale reportable segment.

These procedures also included, among others (i) testing management’s process for developing the accrual;

(ii) evaluating the appropriateness of the estimation methodology applied in developing the accrual;

(iii) evaluating the applicability of the historical cost of materials and labor used in the methodology;

and (iv) testing the completeness and accuracy of the historical cost of materials and labor.

Goodwill Impairment Assessment – Joybird Reporting Unit

As described in Notes 1 and 7 to the consolidated financial statements, as of April 27, 2024, the Company’s consolidated goodwill balance was $214.5 million, and the goodwill associated with the Corporate and Other reportable segment was $55.4 million, which is inclusive of the Joybird reporting unit.

As described in Notes 1 and 6 to the consolidated financial statements, as of April 26, 2025, the Company’s goodwill balance was $205.6 million, and the goodwill associated with the Joybird reporting unit was $55.4 million.

Management tests goodwill for impairment on an annual basis in the fourth quarter of the fiscal year, or more frequently if events or changes in circumstances indicate that the carrying value may be impaired.

In situations where the fair value is less than the carrying value, an impairment charge would be recorded for the shortfall.

To estimate the fair value of the Joybird reporting unit, management applied a combination of the income approach and the market approach, weighted 75% and 25%, respectively.

The income approach used discounted future cash flows and the market approach used the guideline public company method, which derives a valuation from market multiples based on revenue for comparable public companies and was adjusted for a control premium.

Management’s cash flow projections for the Joybird reporting unit included assumptions relating to sales and operating income projections and terminal growth rate as well as other assumptions relating to discount rate and tax rate which are used in the discounted cash flow model.

For the annual test, management performed a quantitative goodwill impairment test for the Joybird reporting unit.

To estimate the fair value of the reporting unit, management applied a combination of the income approach and the market approach, weighted 75 % and 25 % , respectively.

The income approach used discounted future cash flows and key assumptions related to sales and operating income projections, terminal growth rate, discount rate, and tax rate.

The market approach used the guideline public company method, which derives a valuation from market multiples based on revenue for comparable public companies and was adjusted for a control premium.

No impairment was recorded as a result of the annual test.

The principal considerations for our determination that performing procedures relating to the goodwill impairment assessment of the Joybird reporting unit is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the Joybird reporting unit;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to sales and operating income projections and the discount rate used in the discounted cash flow model, and the market multiples based on revenue for comparable public companies used in the market approach;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to sales and operating income projections and the discount rate used in the income approach, and the market multiples based on revenue for comparable public companies used in the market approach;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to

management’s goodwill impairment assessment, including controls over the valuation of the Joybird reporting unit, which included controls over significant assumptions related to the sales and operating income projections, the discount rate and the market multiples based on revenue for comparable public companies.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessment, including controls over the valuation of the Joybird reporting unit.

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the Joybird reporting unit;

(ii) evaluating the appropriateness of the discounted cash flow model and market approach used by management;

(iii) testing the completeness and accuracy of underlying data used in the discounted cash flow model and market approach;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to the sales and operating income projections and the discount rate used in the discounted cash flow model, and the market multiples based on revenue for comparable public companies used in the market approach.

(ii) evaluating the appropriateness of the income approach and market approach used by management;

(iii) testing the completeness and accuracy of underlying data used in the income approach and market approach;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to the sales and operating income projections and discount rate used in the income approach, and the market multiples based on revenue for comparable public companies used in the market approach.

Evaluating management’s assumptions related to the sales and operating income projections involved evaluating whether the assumptions used by management were reasonable considering (i) the current and past performance of the Joybird reporting unit;

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and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s discounted cash flow model and market approach and (ii) the reasonableness of the discount rate assumption used in the discounted cash flow model and market multiples based on revenue for comparable public companies assumption used in the market approach.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the Company’s income approach and market approach;

(ii) the reasonableness of the discount rate assumption used in the income approach;

and (iii) the reasonableness of the market multiples based on revenue for comparable public companies assumption used in the market approach.

Goodwill Impairment Assessment – United Kingdom Reporting Unit

As described in Notes 1 and 6 to the consolidated financial statements, management tests goodwill for impairment on the annual basis in the fourth quarter, or more frequently if events of changes in circumstances indicate that it might be impaired.

For the annual test, management performed a quantitative goodwill impairment test for the United Kingdom reporting unit.

To estimate the fair value of the reporting unit, management applied the income approach using discounted future cash flows and key assumptions related to sales and operating income projections, terminal growth rate, discount rate, and tax rate.

As of April 26, 2025, the Company’s goodwill balance was $205.6 million, and the goodwill associated with the United Kingdom reporting unit was zero after management recorded an impairment charge of $ 20.6 million during the fourth quarter.

The principal considerations for our determination that performing procedures relating to the goodwill impairment assessment of the United Kingdom reporting unit is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the United Kingdom reporting unit;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to sales and operating income projections;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessment, including controls over the valuation of the United Kingdom reporting unit.

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the United Kingdom reporting unit;

(ii) evaluating the appropriateness of the income approach;

(iii) testing the completeness and accuracy of underlying data used in the income approach;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to the sales and operating income projections.

(ii) the consistency with external market and industry data;

and (iii) whether these assumptions were consistent with evidence obtained in other areas of the audit.

Professionals with specialized skill and knowledge were used to assist in evaluating the appropriateness of the Company’s income approach.

/s/ PricewaterhouseCoopers LLP

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Selling, general and administrative expense 770,000 730,874 753,294

Goodwill impairment 20,581 — —

Operating income 135,837 150,796 211,439

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Currency translation adjustment 3,372 ( 1,955 ) ( 604 )

Net unrealized gain (loss) on marketable securities, net of tax 391 153 ( 668 )

Net unrealized gain on marketable securities, net of tax 91 391 153

Net pension amortization, net of tax ( 92 ) 419 807

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Cash and equivalents $ 328,449 $ 341,098

Restricted cash — 3,304

Receivables, net of allowance of $ 5,042 at 4/26/2025 and $ 5,076 at 4/27/2024

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Equity-based compensation expense 17,400 14,426 12,458

Goodwill impairment 20,581 — —

Change in deferred taxes 5,116 ( 3,268 ) 3,895

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Cash flows from financing activities

Payments on debt and finance lease liabilities ( 489 ) ( 123 ) ( 121 )

Payments on finance lease liabilities ( 663 ) ( 489 ) ( 123 )

Holdback payments for acquisitions — ( 5,000 ) ( 5,000 )

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Our fiscal year ends on the last Saturday of April.

Our 2024 and 2023 fiscal years included 52 weeks, whereas our 2022 fiscal year included 53 weeks.

The additional week in fiscal 2022 was included in the fourth quarter.

Our 2025, 2024 and 2023 fiscal years included 52 weeks.

Principles of Consolidation

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All intercompany transactions have been eliminated, including any related profit on intercompany sales.

At April 27, 2024, we owned investments in two privately-held companies consisting of non-marketable preferred shares, warrants to purchase common shares, and convertible notes.

Each of these companies is a variable interest entity and we have not consolidated their results in our financial statements because we do not have the power to direct those activities that most significantly impact their economic performance and, therefore, are not the primary beneficiary.

Use of Estimates

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Actual results could differ from those estimates.

Change in Accounting Policy - Distribution Center Costs

In the first quarter of fiscal 2024, we made a voluntary change to the presentation of costs directly attributable to our distribution activities conducted through our distribution centers in the United States.

Our policy has changed from presenting these costs within selling, general and administrative ("SG&A") expense to presenting them as cost of sales.

We believe this presentation is preferable because it will enhance the comparability of our financial statements with those of our industry peers and align with how we internally manage supply chain costs and margin.

In accordance with US GAAP, the periods presented below have been retrospectively adjusted to reflect the change to cost of sales and SG&A expense.

This change had no impact to sales, income from operations, net income, earnings per share, retained earnings or other components of equity or net assets.

(Unaudited, amounts in thousands) For the Year Ended April 29, 2023 For the Year Ended April 30, 2022

Previously Reported Effect of Change As Adjusted Previously Reported Effect of Change As Adjusted

Cost of sales $ 1,340,734 $ 43,966 $ 1,384,700 $ 1,440,842 $ 36,175 $ 1,477,017

Gross profit 1,008,699 ( 43,966 ) 964,733 915,969 ( 36,175 ) 879,794

Selling, general and administrative expense 797,260 ( 43,966 ) 753,294 709,213 ( 36,175 ) 673,038

Cash and Equivalents

For purposes of the consolidated balance sheet and statement of cash flows, we consider all highly liquid debt instruments purchased with initial maturities of three months or less to be cash equivalents.

Restricted Cash

At April 29, 2023, we had restricted cash on deposit with a bank as collateral for certain letters of credit that matured within 12 months.

During fiscal 2024, we renewed these letters of credit and as of April 27, 2024, we are no longer required to hold restricted cash as collateral.

All of our letters of credit have maturity dates within the next 12 months, and we expect to renew some of these letters of credit when they mature.

The carrying value of cash equivalents approximates fair value due to their short-term nature.

As of April 26, 2025, and April 27, 2024 we had no restricted cash.

Inventories are stated at the lower of cost or market.

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Internal costs relate primarily to employee activities for coding and testing the software under development.

Computer software costs are depreciated over three to five years .

Computer software costs are depreciated over three years .

All maintenance and repair costs are expensed when incurred.

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Any resulting gains or losses are recorded as a component of selling, general and administrative ("SG&A") expenses.

We review the carrying value of our long-lived assets, which includes our right-of-use lease assets, for impairment if events or changes in circumstances indicate that their carrying amounts may not be recoverable.

Our assessment of recoverability is based on our best estimates using either quoted market prices or an analysis of the undiscounted projected future cash flows by asset groups in order to determine if there is any indicator of impairment requiring us to further assess the fair value of our long-lived assets.

We review the carrying value of our long-lived assets, which includes our right-of-use lease assets and our amortizable intangible assets, for impairment if events or changes in circumstances indicate that their carrying amounts may not be recoverable.

Our assessment of recoverability is based on our best estimates using either quoted market prices or an analysis of the undiscounted projected future cash flows by asset group in order to determine if there is any indicator of impairment requiring us to further assess the fair value of our long-lived assets.

Our asset groups consist of our operating segments in our Wholesale reportable segment, each of our retail stores, our Joybird operating segment, and other corporate assets, which are evaluated at the consolidated level.

Amortizable Intangible Assets

We have an amortizable intangible asset for acquired customer relationships related to the acquisition of the La-Z-Boy wholesale business in the United Kingdom and Ireland, which is amortized on a straight-line basis over its estimated useful life of 15 years.

We also have an amortizable intangible asset for the Joybird ® trade name, which is amortized on a straight-line basis over its estimated useful life of eight years .

All intangible amortization expense is recorded as a component of SG&A expense.

Amortizable intangible assets are tested for impairment if events or changes in circumstances indicate that the asset groups to which they are part of might be impaired.

If we determine an assessment for impairment is necessary, we establish the fair value of these amortizable intangible assets based on the multi-period excess earnings method, a variant of the income approach, and the relief from royalty method, as applicable.

Indefinite-Lived Intangible Assets and Goodwill

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When we perform the quantitative test for indefinite-lived intangible assets, we establish the fair value of our indefinite-lived trade names and reacquired rights based upon the relief from royalty method.

When we perform the quantitative test for goodwill, we establish the fair value for the reporting unit based on the income approach, in which we utilize a discounted cash flow model, the market approach, in which

we utilize market multiples of comparable companies, or a combination of both approaches.

In situations where the fair value is less than the carrying value, an impairment charge would be recorded for the shortfall.

Amortizable Intangible Assets

We also have an amortizable intangible asset for the Joybird ® trade name, which is amortized on a straight-line basis over its estimated useful life of eight years .

All intangible amortization expense is recorded as a component of SG&A expense.

We test amortizable intangible assets for impairment if events or changes in circumstances indicate that the assets might be impaired.

Available-for-sale debt securities are recorded at fair value with the net unrealized gains and losses (that are deemed to be temporary) reported as a component of other comprehensive income/(loss).

Equity securities are recorded at fair value with unrealized gains and losses recorded in other income (expense), net.

We also hold investments in two privately-held companies consisting of non-marketable preferred shares, warrants to purchase common shares, and convertible notes.

The fair value of these equity investments (preferred shares and warrants) is not readily determinable and therefore, we estimate the fair value as costs minus impairment, if any, plus or minus adjustments resulting from observable price changes in orderly transactions for identical or similar investments with the same issuer.

The convertible notes are recorded at fair value with the net unrealized gains and losses (that are deemed to be temporary) reported as a component of other comprehensive income, consistent with our other available-for-sale debt securities.

Realized gains and losses for all investments, charges for other-than-temporary impairments of debt securities, and charges for impairment on our equity investments without readily determinable values are included in determining net income, with related purchase costs based on the first-in, first-out method.

Realized gains and losses for all investments and charges for other-than-temporary impairments of debt securities are included in determining net income, with related purchase costs based on the first-in, first-out method.

We evaluate our available-for-sale debt investments for possible other-than-temporary impairments by reviewing factors such as the extent to which an investment's fair value is below our cost basis, the issuer's financial condition, and our ability and intent to hold the investment for sufficient time for its market value to recover.

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The fair value of the investment then becomes the new amortized cost basis of the investment and it is not adjusted for subsequent recoveries in fair value.

There were no impairment charges recorded in fiscal 2024 or fiscal 2022.

During fiscal 2023, we recognized a $ 10.3 million impairment charge for one of our investments which was recorded as a component of other income (expense), net in the consolidated statement of income.

Life Insurance

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Revenues are recognized when control of the promised goods or services is transferred to our customers, in an amount that reflects the consideration we expect to be entitled to receive in exchange for those goods or services.

We generate revenues

primarily by manufacturing/importing and delivering upholstery and casegoods (wood) furniture products to independent furniture retailers, independently-owned La-Z-Boy Furniture Galleries ® stores or the end consumer.

We generate revenues primarily by manufacturing/importing and delivering upholstery and casegoods (wood) furniture products to independent furniture retailers, independently-owned La-Z-Boy Furniture Galleries ® stores or the end consumer.

Each unit of furniture is a separate performance obligation, and we satisfy our performance obligation when control of our product is passed to our customer, which is the point in time that our customers are able to direct the use of and obtain substantially all of the remaining economic benefit of the goods or services.

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Incentives offered to customers include cash discounts, rebates, advertising agreements and other sales incentive programs.

Our sales incentives, including cash discounts and rebates, are recorded as a reduction to revenues.

Our sales incentives, including cash discounts and rebates, are recorded as a

reduction to revenues.

Service allowances are for a distinct good or service with our customers and are recorded as a component of SG&A expense in our consolidated statement of income, and are not recorded as a reduction of revenue and are not considered variable consideration.

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On a quarterly basis, we review all significant accounts as to their past due balances, as well as collectability of the outstanding trade accounts receivable for possible write off.

It is our policy to write off the accounts receivable against the allowance account when we deem the receivable to be

uncollectible.

It is our policy to write off the accounts receivable against the allowance account when we deem the receivable to be uncollectible.

Additionally, we review orders from dealers that are significantly past due, and we ship product only when our ability to collect payment from our customer for the new order is probable.

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Other income (expense), net is made up primarily of foreign currency exchange net gain/(loss), gain/(loss) on the sale of investments, and unrealized gain/(loss) on equity securities.

Other income (expense), net for fiscal 2023 also includes a $ 10.3 million impairment of our investments in a privately-held start-up company.

Research and Development Costs

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A portion of our advertising program is a national advertising campaign.

This campaign is a shared advertising program with our dealers' La-Z-Boy Furniture Galleries ® stores, which reimburse us for approximately 25 % of the cost of the program (excluding company-owned stores).

This campaign is a shared advertising program with our dealers' La-Z-Boy Furniture Galleries ® stores, which reimburse us for over 20 % of the cost of the program (excluding company-owned stores).

Because of this shared cost arrangement, the advertising expense is reported as a component of SG&A, while the dealers' reimbursement portion is reported as a component of sales.

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Foreign Currency Translation

Foreign currency transaction gains and losses associated with translating assets and liabilities denominated in a currency that is different than a subsidiaries' functional currency, are recorded in cost of sales and other income (expense), net in our consolidated statement of income.

Foreign currency transaction gains and losses associated with translating assets and liabilities denominated in a currency that is different than a subsidiary's' functional currency, are recorded in cost of sales and other income (expense), net in our consolidated statement of income.

Assets and liabilities of foreign subsidiaries whose functional currency is their local currency are translated at the year-end exchange rates, and revenues and expenses are translated at average exchange rates for the period, with the corresponding translation effect included as a component of other comprehensive income.

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ASU Description Adoption Date

ASU 2021-08 Business Combinations (Topic 805):

Accounting for Contract Assets and Contract Liabilities from Contracts with Customers Fiscal 2024

Accounting Pronouncements not yet Adopted

The following table summarizes additional accounting pronouncements which we have not yet adopted, but we believe will not have a material impact on our accounting policies or our consolidated financial statements and related disclosures.

ASU Description Adoption Date

ASU 2023-09 Income Taxes (Topic 740):

Improvements to Income Tax Disclosures Fiscal 2026

ASU 2023-07 Segment Reporting (Topic 280):

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Accounting for Investments in Tax Credit Structures Using the Proportional Amortization Method Fiscal 2025

Accounting Pronouncements not yet Adopted

ASU Description Adoption Date

ASU 2024-04 Debt - Debt with Conversion and Other Options (Subtopic 470-20):

Induced Conversions of Convertible Debt Instruments Fiscal 2027

ASU 2024-03 Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses Fiscal 2028

ASU 2023-09 Income Taxes (Topic 740):

Improvements to Income Tax Disclosures Fiscal 2026

None of the below acquisitions were significant to our consolidated financial statements, and, therefore, pro-forma financial information is not presented.

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For federal income tax purposes, we amortize and deduct these indefinite-lived intangible assets and goodwill, if any, over 15 years.

Lansing and Portage, Michigan Acquisition

On April 7, 2025, we completed our acquisition of the Lansing and Portage, Michigan businesses that operate two independently owned La-Z-Boy Furniture Galleries ® stores for $ 5.7 million, inclusive of and subject to further customary adjustments.

We paid total cash of $ 4.7 million during the fourth quarter of fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 2.1 million related to the reacquired rights described above.

We also recognized $ 3.8 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired stores and future benefits of these synergies.

Toledo , Ohio Acquisition

On January 16, 2025, we completed our acquisition of the Toledo, Ohio business that operates two independently owned La-Z-Boy Furniture Galleries ® stores for $ 5.9 million, inclusive of and subject to further customary adjustments.

The acquisition also included the purchase of the building and land for one of the stores.

We paid total cash of $ 5.7 million during the third and fourth quarters of fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 1.7 million related to the reacquired rights described above.

We also recognized $ 0.6 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired stores and future benefits of these synergies.

Melbourne and Cocoa, Florida Acquisition

On September 10, 2024, we completed our acquisition of the Melbourne and Cocoa, Florida businesses that operate two independently owned La-Z-Boy Furniture Galleries ® stores and one distribution center for $ 11.4 million, inclusive of and subject to further customary adjustments.

The acquisition also included the purchase of buildings and land for both stores and the distribution center.

We paid total cash of $ 11.3 million during the second and third quarters of fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 0.9 million related to the reacquired rights described above.

We also recognized $ 1.7 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired stores and future benefits of these synergies.

Davenport, Iowa Acquisition

On July 22, 2024, we completed our acquisition of the Davenport, Iowa business that operates one independently owned La-Z-Boy Furniture Galleries ® store for $ 7.4 million, inclusive of and subject to further customary adjustments.

We paid total cash of $ 6.9 million during the first and second quarters of fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 1.7 million related to the reacquired rights described above.

We also recognized $ 5.1 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired store and future benefits of these synergies.

Prior Year Acquisitions

We completed the following acquisitions in fiscal 2024.

Bradenton and Sarasota, Florida Acquisition

On April 8, 2024, we completed our acquisition of the Bradenton and Sarasota, Florida businesses that operate two independently owned La-Z-Boy Furniture Galleries ® stores for $ 15.7 million, inclusive of and subject to further customary adjustments.

The acquisition also included the purchase of buildings and land for both stores.

We paid total cash of $ 14.3 million during the fourth quarter of fiscal 2024 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

We paid total cash of $ 15.3 million during the fourth quarter of fiscal 2024 and first quarter fiscal 2025 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 1.9 million related to the reacquired rights described above.

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Illinois and Indiana Acquisition

On December 11, 2023, we completed our acquisition of the Illinois and Indiana businesses that operate six independently owned La-Z-Boy Furniture Galleries ® stores and one distribution center for $ 18.4 million, inclusive of and subject to further customary adjustments.

The acquisition also included the purchase of buildings and land for five of the stores.

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Lafayette, Louisiana Acquisition

On October 23, 2023, we completed our acquisition of the Lafayette, Louisiana business that operates one independently owned La-Z-Boy Furniture Galleries ® store and one distribution center for $ 2.8 million, inclusive of and subject to further customary adjustments.

We paid total cash of $ 2.6 million during the second and third quarters of fiscal 2024 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

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Colorado Springs, Colorado Acquisition

On July 17, 2023, we completed our acquisition of the Colorado Springs, Colorado business that operates two independently owned La-Z-Boy Furniture Galleries ® stores and one distribution center for $ 6.0 million, inclusive of and subject to further to customary adjustments.

We paid total cash of $ 5.6 million during the first and second quarters of fiscal 2024 and the remaining consideration included forgiveness of accounts receivable and payments based on working capital adjustments.

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We also recognized $ 2.2 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired stores and future benefits of these synergies.

Prior Year Acquisitions

We completed the following acquisitions in fiscal 2023.

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We also recognized $ 7.6 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired stores and future benefits of these synergies.

We completed the following acquisitions in fiscal 2022.

Alabama and Chattanooga, Tennessee acquisition

On December 6, 2021, we completed our acquisition of the Alabama and Chattanooga, Tennessee businesses that operate four independently owned La-Z-Boy Furniture Galleries ® stores in Alabama and one in Chattanooga, Tennessee, for $ 8.3 million, inclusive of customary adjustments.

We paid total cash of $ 8.0 million in the third quarter of fiscal 2022 and the remaining consideration includes forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 4.1 million related to the reacquired rights described above.

We also recognized $ 7.4 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired stores and future benefits of these synergies.

Furnico (La-Z-Boy United Kingdom Manufacturing) acquisition

On October 25, 2021, we completed the acquisition of Furnico Furniture Ltd ("Furnico"), an upholstery manufacturing business in the U.K for approximately $ 13.3 million, inclusive of customary adjustments and in the third and fourth quarters of fiscal 2022, we paid $ 13.9 million of cash for the purchase of the Furnico business.

Furnico produces La-Z-Boy branded product for the La-Z-Boy U.K.

business and also operates a wholesale business, selling white label products to key U.K.

With this acquisition, we expect to realize production synergies, cost savings through materials procurement, and increases in production capacity to support growth in the La-Z-Boy U.K business.

As part of the acquisition, we recognized $ 9.2 million of goodwill in our Wholesale segment related primarily to synergies we expect from the integration of the acquired business and future benefits of these synergies.

The goodwill asset for Furnico is not deductible for federal income tax purposes.

Long Island, New York acquisition

On August 16, 2021, we completed our acquisition of the Long Island, New York business that operates three independently owned La-Z-Boy Furniture Galleries ® stores for $ 4.5 million, inclusive of customary adjustments.

We paid $ 4.4 million of cash during the second quarter of fiscal 2022 and the remaining consideration includes forgiveness of accounts receivable and payments based on working capital adjustments.

As part of the acquisition, we recorded an indefinite-lived intangible asset of $ 0.8 million related to the reacquired rights described above.

We also recognized $ 4.4 million of goodwill in our Retail segment related primarily to synergies we expect from the integration of the acquired stores and future benefits of these synergies.

Restricted Cash

(Amounts in thousands) 4/26/2025 4/27/2024

Cash and cash equivalents $ 341,098 $ 343,374

Restricted cash — 3,304

Total cash, cash equivalents and restricted cash $ 341,098 $ 346,678

(Amounts in thousands) 4/27/2024 4/29/2023

Raw materials $ 128,823 $ 125,932

107 unchanged sentences

United Kingdom Reporting Unit

Due to a decline in the United Kingdom's financial performance in fiscal 2024, we deemed it necessary to perform the quantitative Step 1 goodwill impairment test for the United Kingdom reporting unit.

To estimate the fair value of this reporting unit, we applied the income approach using discounted future cash flows.

Sales and operating income projections were based on assumptions driven by the current economic conditions and assumed a 2.0 % terminal growth rate.

Due to a decline in the United Kingdom's financial performance in fiscal 2025, primarily due to a significant customer transition and a challenging consumer environment, we deemed it necessary to perform the quantitative Step 1 goodwill impairment test for the United Kingdom reporting unit.

To estimate the fair value of this reporting unit, we applied the income approach using discounted future cash flows in which sales and operating income projections were based on assumptions driven by the current economic conditions and assumed a 2.0 % terminal growth rate.

Our projections of revenue and operating income also include certain assumptions related to incremental business with new customers.

Other key assumptions used in the quantitative assessment of the reporting unit's goodwill were a discount rate of 10.4 %, reflecting a market participant weighted average cost of capital, and a tax rate of 25.0 %, which was specific to the United Kingdom reporting unit.

Based on our testing, the fair value of the United Kingdom reporting unit exceeded its carrying value as of April 27, 2024 by approximately 28 % and no impairment was recorded.

Based on our testing, the carrying value of the United Kingdom reporting unit exceeded its fair value as of April 26, 2025, by an amount greater than the recorded goodwill, and we recorded a non-cash pre-tax impairment charge of $ 20.6 million during the fourth quarter of fiscal 2025 to reduce the carrying value of the goodwill to zero .

Joybird Reporting Unit

Due to a decline in Joybird's financial performance in fiscal 2024, we deemed it necessary to perform the quantitative Step 1 goodwill impairment test for the Joybird reporting unit.

Due to limited headroom from the fiscal 2024 impairment testing, we deemed it necessary to perform the quantitative Step 1 goodwill impairment test for the Jo ybird reporting unit.

To estimate the fair value of this reporting unit, we applied a combination of the income approach and the market approach, weighted 75 % and 25 %, respectively.

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The market approach used the guideline public company method, which derives a valuation from market multiples based on revenue for comparable public companies and was adjusted for a control premium based on recent merger and acquisition transaction data of target companies similar to the Joybird reporting unit.

Based on our testing, the fair value of the Joybird reporting unit exceeded its carrying value as of April 27, 2024 by approximately 6 % and no impairment was recorded.

Further, a sensitivity analysis was performed on key assumptions used in the valuation, primarily the discount rate and terminal growth rate, and using a range of reasonable inputs, the fair value of the Joybird reporting unit either exceeded its carrying value or did not exceed its carrying value by an immaterial amount, for each of the various scenarios analyzed.

However, changes to other valuation inputs or failure to meet our forecasts, in particular our sales and operating income projections, could

reduce the fair value of the Joybird reporting unit and thus increase the possibility that our goodwill may be impaired in the future.

Based on our testing, the fair value of the Joybird reporting unit exceeded its carrying value as of April 26, 2025 by approximately 16 % a nd no impairment was recorded.

Further, a sensitivity analysis was performed on key assumptions used in the valuation, primarily the discount rate and terminal growth rate, and using a range of reasonable inputs, the fair value of the Joybird reporting unit exceeded its carrying value for each of the various scenarios analyzed .

However, changes to other valuation inputs or failure to meet our forecasts, in particular our sales and operating income projections, could reduce the fair value of the Joybird reporting unit and thus increase the possibility that our goodwill may be impaired in the future.

The following table summarizes changes in the carrying amount of our goodwill by reportable segment:

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Acquisitions — 11,269 — 11,269

Impairment ( 20,581 ) — — ( 20,581 )

Translation adjustment 496 ( 47 ) — 449

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Amortizable over eight -year useful life

We test amortizable intangible assets for impairment if events or changes in circumstances indicate that the assets might be impaired.

We test indefinite-lived intangible assets for impairment on an annual basis in the fourth quarter of our fiscal year, or more frequently if events or changes in circumstances indicate that the assets might be impaired.

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Based on the same qualitative factors outlined above, we determined that it is more likely than not that the fair value of each of our indefinite-lived intangible assets exceeded their respective carrying value and as such, our indefinite-lived intangible assets were not considered impaired as of April 26, 2025, and the Step 1 quantitative impairment analysis was not necessary.

During the fourth quarter of fiscal 2025, as a result of the challenges in our United Kingdom businesses as noted above, we determined there were events that indicated the carrying value of our United Kingdom asset group might be impaired.

Using cash flows consistent with those used in the goodwill impairment testing, we determined the projected undiscounted cash flows were less than the carrying value of the asset group.

To estimate the fair value of the United Kingdom asset group, we applied the income approach using discounted future cash flows consistent with those used in our goodwill impairment testing.

As a result, we recorded an impairment charge of $ 1.5 million related to our customer relationship intangible asset .

The impairment charge was recorded in S G&A expense within the Wholesale segment.

The following summarizes changes in our intangible assets:

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Amortization — ( 798 ) — ( 222 ) ( 1,020 )

Impairment — — — ( 1,479 ) ( 1,479 )

Translation adjustment — — ( 36 ) 41 5

Balance at April 26, 2025 $ 1,155 $ 998 $ 49,008 $ — $ 51,161

For our intangible assets recorded as of April 27, 2024, we estimate annual amortization expense to be $ 1.0 million for each of the two succeeding fiscal years, $ 0.4 million in the third succeeding fiscal year, and $ 0.2 million in the fourth and fifth succeeding fiscal years.

We have current and long-term investments intended to enhance returns on our cash as well as to fund future obligations of our non-qualified defined benefit retirement plan, our executive deferred compensation plan, and our performance compensation retirement plan.

We also hold investments of two privately-held companies consisting of non-marketable preferred shares, warrants to purchase common shares, and convertible notes.

In the fourth quarter of fiscal 2023, we recognized an impairment of $ 10.3 million, consisting of $ 7.6 million in cost-basis investments and $ 2.7 million in convertible notes, which in total represented the full cost-basis value of the investment in one of these privately held start-up companies.

The impairment loss is recognized in other income (expense), net, on the consolidated statement of income.

For our intangible assets recorded as of April 26, 2025, we estimate annual amortization expense to be $ 0.8 million in the subsequent fiscal year and $ 0.2 million in the second succeeding fiscal year, with no amortization estimated thereafter.

We have current and long-term investments intended to enhance returns on our cash as well as to fund future obligations of certain retirement plans.

Our short-term investments are included in other current assets and our long-term investments are included in other long-term assets on our consolidated balance sheet.

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Gross realized losses ( 40 ) ( 768 ) ( 242 )

The following is a summary of the fair value of fixed income marketable securities, classified as available-for-sale securities, by contractual maturity:

(Amounts in thousands) 4/27/2024

Within one year $ 5,495

Securities not due at a single maturity date 6,520

Total $ 12,015

Accrued Expenses and Other Current Liabilities

As of April 26, 2025, we held $ 6.3 million of fixed income marketable securities, classified as available-for-sale securities, all of which do not have a single contractual maturity date.

Accrued Expenses and Other Liabilities

(Amounts in thousands) 4/26/2025 4/27/2024

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Employee Benefits

The table below summarizes the total costs associated with our employee retirement and welfare plans.

The table below summarizes the total costs associated with our employee benefit plans.

Fiscal Year Ended

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Prior year contributions were based on achievement of performance targets.

Employees vest in these prior period contributions if they achieve certain age and years of service with the Company and can elect to receive benefit payments over a period ranging

between five to twenty years after they leave the Company.

Employees vest in these prior period contributions if they achieve certain age and years of service with the Company and can elect to receive benefit payments over a period ranging between five to twenty years after they leave the Company.

While the Company no longer makes contributions, the outstanding liability balance related to the plan is as follows:

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$ 29,940 $ 28,909

(1) Accruals and settlements for fiscal 2023 have been revised.

The adjustments were offsetting and had no impact on the liability balance at the end of fiscal 2023 or the amount recognized in the consolidated statement of income for fiscal 2023.

(2) $ 22.4 million and $ 19.9 million is recorded in accrued expenses and other current liabilities as of April 27, 2024, and April 29, 2023, respectively, while the remainder is included in other long-term liabilities.

(1) $ 22.4 million is recorded in accrued expenses and other current liabilities as of April 26, 2025 and April 27, 2024, while the remainder is included in other long-term liabilities.

We recorded accruals during the periods presented in the table above, primarily to reflect charges that relate to warranties issued during the respective periods.

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Under this plan, the aggregate number of common shares that may be issued through awards of any form is 3.1 million shares, reduced by the number of shares subject to awards granted under the La-Z-Boy Incorporated 2022 Omnibus Incentive Plan after April 27, 2024 and prior to the Annual Meeting of Shareholders of La-Z-Boy Incorporated held on August 27, 2024.

Awards granted in fiscal 2025 were made under our La-Z-Boy Incorporated 2022 Omnibus Incentive Plan.

As of the end of fiscal 2025, no grants may be issued under this plan or any of our previous plans.

The table below summarizes the total stock-based compensation expense we recognized for all outstanding grants.

Stock-based compensation expense is recorded in SG&A in the consolidated statement of income:

Stock-based compensation expense is recorded in SG&A expense in the consolidated statement of income:

Fiscal Year Ended

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Liability-based awards expense (1)

152 162 ( 1,131 )

Total stock-based compensation expense $ 17,491 $ 14,578 $ 12,620

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We recognize compensation expense for restricted stock over the vesting period equal to the fair value on the date our Compensation and Talent Oversight Committee of our board of directors approved the awards.

Restricted stock awards vest at 25 % per year, beginning one year from the grant date for a term of four years , with continued vesting upon retirement with respect to the fiscal 2023 and 2024 grants.

We accelerate the expense for restricted stock granted to retirement-eligible employees over the vesting period, with expense recognized from the grant date through their retirement eligibility date or over the ten months following the grant date, whichever period is longer.

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During the first quarter of fiscal 2025, we granted 163,888 performance-based shares, and we also have performance-based share awards outstanding from grants in fiscal 2024 and fiscal 2023.

Payout of these grants depend on our financial performance ( 50 %) and a market-based condition based on the total return our shareholders receive on their investment in our stock relative to returns earned through investments in other public companies ( 50 %).

Payout of these grants depends on our financial performance ( 50 %) and a market-based condition based on the total return our shareholders receive on their investment in our stock relative to returns earned through investments in other public companies ( 50 %).

The performance share opportunity ranges from 50 % of the employee's target award if minimum performance requirements are met to a maximum of 200 % of the target award based on the attainment of certain financial and shareholder-return goals over a specific performance period, which is generally three fiscal years.

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Our unrecognized compensation cost at April 26, 2025, related to performance-based shares was $ 7.0 million based on the current estimates of the number of awards that will vest, and is expected to be recognized over a weighted-average remaining contractual term of all unvested awards of 1.7 years.

Equity-based compensation expenses related to performance-based shares recognized in our consolidated statement of income were as follows (for the fiscal years ended):

Equity-based compensation expenses related to performance-based shares recognized in our consolidated statement of income are as follows:

Fiscal Year Ended

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Stock Options.

We did not grant stock options to employees during fiscal 2024, but we have stock options outstanding from grants from prior years.

We did not grant stock options to employees during fiscal 2025 or fiscal 2024, but we have stock options outstanding from grants from prior years.

We account for stock options as equity-based awards because when they are exercised, they will be settled in common shares.

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We estimated the fair value of the employee stock options granted in prior years at their respective grant date using the Black-Scholes option-pricing model, which requires management to make certain assumptions.

The fair value of stock options granted during fiscal years 2023 and 2022 were calculated using the following assumptions:

The fair value of stock options granted during fiscal year 2023 were calculated using the following assumptions:

Risk-free interest rate 2.87 % U.S.

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Dividend rate 2.70 % Estimated future dividend rate and common share price at grant date

Expected life 5.0 years 5.0 years Contractual term of stock option and expected employee exercise trends

Expected life 5.0 years Contractual term of stock option and expected employee exercise trends

Stock price volatility 42.78 % Historical volatility of our common shares

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Restricted stock units granted to our non-employee directors are offered at no cost to the directors and restricted stock units granted following August 2022 vest on the earlier of the date a director ceases to be a member of the board (for any reason other than the termination of service for cause) or the one-year anniversary of the grant date.

During fiscal 2024, we granted less than 0.1 million restricted stock units to our non-employee directors.

During fiscal 2025, we granted 32,378 restricted stock units to our non-employee directors.

We account for these restricted stock units as equity-based awards because when they vest, they will be settled in shares of our common stock.

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Activity in accumulated other comprehensive loss was as follows:

(Amounts in thousands) Translation adjustment Unrealized gain (loss) on marketable securities Net pension amortization and net actuarial loss Accumulated other comprehensive income (loss)

(Amounts in thousands) Translation adjustment Unrealized gain (loss) on marketable securities Net pension amortization and net actuarial gain (loss) Accumulated other comprehensive income (loss)

Balance at April 30, 2022 $ ( 1,961 ) $ ( 298 ) $ ( 3,538 ) $ ( 5,797 )

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(1) Primarily includes revenue for advertising, royalties, parts, accessories, after-treatment products, surcharges, rebates and other sales incentives.

In fiscal 2024, certain amounts that were previously charged as surcharges in fiscal 2023 are now included in the base product pricing and reflected in the amounts by product category.

Upholstered Furniture - Includes revenue for upholstered furniture, such as recliners, sofas, loveseats, chairs, sectionals, modulars, and ottomans.

This revenue includes sales to La-Z-Boy Furniture Galleries ® stores (including company-owned stores), operators of La-Z-Boy Comfort Studio ® locations, England Custom Comfort Center locations, other major dealers, independent retailers, and the end consumer.

This revenue includes sales to La-Z-Boy Furniture Galleries ® stores (including company-owned stores), operators of La-Z-Boy Comfort Studio ® and branded space locations, England Custom Comfort Center locations, other major dealers, independent retailers, and the end consumer.

Casegoods Furniture - Includes revenue for casegoods furniture typically found in a bedroom, such as beds, chests, dressers, nightstands and benches;

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(1) During the year ended April 26, 2025, we recognized revenue of $ 116.6 million related to our contract liability balance at April 27, 2024.

Contract assets, customer deposits, and deferred revenue decreased during fiscal 2024 primarily due to a reduction in backlog .

Segment Information

We report segment information consistent with the way our chief operating decision maker, (the "CODM"), our Board Chair, President and Chief Executive Officer, evaluates the operating results and performance of the Company.

Our reportable operating segments include the Wholesale segment and the Retail segment.

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Our Wholesale segment manufactures and imports upholstered furniture, such as recliners and motion furniture, sofas, loveseats, chairs, sectionals, modulars, ottomans and sleeper sofas and imports casegoods (wood) furniture such as bedroom sets, dining room sets, entertainment centers and occasional pieces.

The Wholesale segment sells directly to La-Z-Boy Furniture Galleries ® stores, operators of La-Z-Boy Comfort Studio ® locations, England Custom Comfort Center locations, major dealers, and a wide cross-section of other independent retailers.

The Wholesale segment sells directly to La-Z-Boy Furniture Galleries ® stores, operators of La-Z-Boy Comfort Studio ® and branded space locations, England Custom Comfort Center locations, major dealers, and a wide cross-section of other independent retailers.

Retail Segment .

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Corporate and Other .

Corporate and Other includes the shared costs for corporate functions, including human resources, information technology, finance and legal, in addition to revenue generated through royalty agreements with companies licensed to use the La-Z-Boy ® brand name on various products.

Corporate and Other includes the shared costs for corporate functions, including human resources, information technology, finance and accounting, and legal, in addition to revenue generated through royalty agreements with companies licensed to use the La-Z-Boy ® brand name on various products.

We consider our corporate functions to be other business activities and have aggregated them with our other insignificant operating segments, including our global trading company in Hong Kong and Joybird, an e-commerce retailer that manufactures upholstered furniture such as sofas, loveseats, chairs, ottomans, sleeper sofas and beds, and also imports casegoods (wood) furniture such as occasional tables and other accessories.

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None of the operating segments included in Corporate and Other meet the requirements of reportable segments.

We use operating income to evaluate segment performance and to allocate resources.

Segment operating income is based on profit or loss from operations before interest expense, interest income, other income (expense), net and income taxes.

The CODM assesses performance by regularly reviewing each segment's significant expense categories which include cost of sales, selling, general and administrative ("SG&A") expenses, and goodwill impairment, if applicable.

The accounting policies of the operating segments are the same as those described in Note 1, Accounting Policies.

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Operating income realized on intersegment revenue transactions is therefore generally consistent with the operating income realized on our revenue from independent third-party transactions.

Segment operating income is based on profit or loss from operations before interest expense, interest income, other income (expense), net and income taxes.

Identifiable assets are cash and equivalents, notes and accounts receivable, net inventories, net property, plant and equipment, right-of-use lease assets, goodwill and other intangible assets.

Identifiable assets are cash and equivalents, accounts receivable, net inventories, net property, plant and equipment, right-of-use lease assets, goodwill and other intangible assets.

Our unallocated assets include deferred income taxes, corporate assets (including a portion of cash and equivalents), and various other assets.

Sales are attributed to countries on the basis of the customer's location.

Asset information is regularly reviewed by the CODM at the consolidated level and segment-level asset information is not used for purposes of making decisions, assessing financial performance, or allocating resources.

The following table presents sales and operating income (loss) by segment:

Fiscal Year Ended

(52 weeks) (52 weeks) (53 weeks)

(Amounts in thousands) 4/27/2024 4/29/2023 4/30/2022

Wholesale segment:

Year Ended April 26, 2025

(Amounts in thousands) Wholesale Retail Corporate & Other Intersegment Eliminations Consolidated

Sales to external customers $ 1,056,914 $ 898,370 $ 153,923 $ — $ 2,109,207

Intersegment sales 422,905 — 6,552 ( 429,457 ) —

Wholesale segment sales 1,447,278 1,690,248 1,768,838

Retail segment sales 855,126 982,043 804,394

Corporate and Other:

Total sales 1,479,819 898,370 160,475 ( 429,457 ) 2,109,207

Cost of sales 1,093,828 399,038 67,540 ( 377,617 ) 1,182,789

Gross profit 385,991 499,332 92,935 ( 51,840 ) 926,418

SG&A expenses 283,197 393,915 144,728 ( 51,840 ) 770,000

Goodwill impairment 20,581 — — — 20,581

Operating income (loss) $ 82,213 $ 105,417 $ ( 51,793 ) $ — $ 135,837

Interest expense ( 545 )

Interest income 14,877

Other income (expense), net ( 3,035 )

Income before income taxes $ 147,134

Year Ended April 27, 2024

(Amounts in thousands) Wholesale Retail Corporate & Other Intersegment Eliminations Consolidated

Sales to external customers $ 1,048,431 $ 855,126 $ 143,470 $ — $ 2,047,027

Intersegment sales 398,847 — 10,299 ( 409,146 ) —

Corporate and Other sales 153,769 166,190 195,959

Eliminations ( 409,146 ) ( 489,048 ) ( 412,380 )

Consolidated sales $ 2,047,027 $ 2,349,433 $ 2,356,811

Total sales 1,447,278 855,126 153,769 ( 409,146 ) 2,047,027

Cost of sales 1,073,251 380,520 72,626 ( 361,040 ) 1,165,357

Gross profit 374,027 474,606 81,143 ( 48,106 ) 881,670

SG&A expenses 274,654 362,924 141,402 ( 48,106 ) 730,874

Operating income (loss) $ 99,373 $ 111,682 $ ( 60,259 ) $ — $ 150,796

Wholesale segment $ 99,373 $ 115,215 $ 134,013

Retail segment 111,682 161,571 109,546

Corporate and Other ( 60,259 ) ( 65,347 ) ( 36,803 )

Consolidated operating income 150,796 211,439 206,756

Interest expense ( 455 )

2 unchanged sentences

Income before income taxes $ 165,752

Year Ended April 29, 2023

(Amounts in thousands) Wholesale Retail Corporate & Other Intersegment Eliminations Consolidated

Sales to external customers $ 1,215,429 $ 982,043 $ 151,961 $ — $ 2,349,433

Intersegment sales 474,819 — 14,229 ( 489,048 ) —

Total sales 1,690,248 982,043 166,190 ( 489,048 ) 2,349,433

Cost of sales 1,289,247 449,117 84,453 ( 438,117 ) 1,384,700

Gross profit 401,001 532,926 81,737 ( 50,931 ) 964,733

SG&A expenses 285,786 371,355 147,084 ( 50,931 ) 753,294

Operating income (loss) $ 115,215 $ 161,571 $ ( 65,347 ) $ — $ 211,439

Interest expense ( 536 )

Interest income 6,670

Other income (expense), net ( 11,784 )

Income before income taxes $ 205,789

The following tables present additional financial information by segment and location.

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Total 100 % 100 % 100 %

(1) Sales are attributed to countries on the basis of the customer's location.

(Amounts in thousands) 4/26/2025 4/27/2024

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State income taxes, net of federal benefit 5.1 % 4.3 % 4.5 %

Losses/(gains) on corporate owned life insurance ( 0.6 ) % 0.2 % — %

Fair value adjustment of contingent consideration liability — % ( 0.1 ) % ( 0.3 ) %

Change in valuation allowance 1.8 % — % — %

Non-deductible asset impairment 3.5 % — % — %

Foreign rate differences 1.2 % ( 0.2 ) % ( 0.2 ) %

Miscellaneous items ( 1.2 ) % ( 0.3 ) % 0.9 %

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Employee benefits 2,611 3,153

Federal net operating losses, credits 152 530

Federal and foreign net operating losses, credits 2,613 152

Other 1,999 1,822

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(Amounts in thousands) Amount Expiration

Federal net operating losses $ 152 Fiscal 2039

state net operating losses (excluding federal tax effect) $ 1,169 Fiscal 2026-2040

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(Amounts in thousands) 4/26/2025 4/27/2024 Change

Federal $ — $ 1,822 $ ( 1,822 )

State $ 1,449 $ 1,310 $ 139

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state deferred taxes are primarily related to state net operating losses and state tax credits.

The foreign deferred taxes are primarily related to capital losses.

The foreign deferred taxes are primarily related to net operating losses.

As of April 26, 2025, we had a gross unrecognized tax benefit of $ 1.1 million related to uncertain tax positions in various jurisdictions.

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We recognize interest and penalties associated with uncertain tax positions in income tax expense.

We had approximately $ 0.5 million and $ 0.4 million accrued for interest and penalties as of April 27, 2024 and April 29, 2023, respectively.

We had approximately $ 0.5 million accrued for interest and penalties as of April 26, 2025 and April 27, 2024.

If recognized, $ 0.9 million of the total $ 1.1 million of unrecognized tax benefits would decrease our effective tax rate.

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Net income attributable to La-Z-Boy Incorporated $ 99,556 $ 122,626 $ 150,664

Income allocated to participating securities (1)

Net income available to common Shareholders $ 122,626 $ 150,664 $ 150,010

Basic weighted average common shares outstanding 41,601 42,878 43,148

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$ 2.35 $ 2.83 $ 3.48

(1) Prior to fiscal 2019, we granted restricted stock awards that contained non-forfeitable rights to dividends on unvested shares, and we are required to include these participating securities in calculating our basic earnings per common share, using the two-class method.

(1) Diluted earnings per share was computed using the treasury stock method.

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We exclude the effect of options from our diluted share calculation when the weighted average exercise price of the options is higher than the average market price, since including the options' effect would be anti-dilutive.

We excluded options to purchase 0.5 million, 1.4 million and 0.2 million shares from the diluted share calculation for the years ended April 27, 2024, April 29, 2023 and April 30, 2022, respectively.

We did not exclude any outstanding options from the diluted share calculation for the fiscal year ended April 26, 2025.

We excluded options to purchase 0.5 million and 1.4 million shares from the diluted share calculation for the years ended April 27, 2024 and April 29, 2023, respectively.

Fair Value Measurements

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In addition to assets and liabilities that we record at fair value on a recurring basis, we are required to record assets and liabilities at fair value on a non-recurring basis.

We measure non-financial assets such as other intangible assets, goodwill, and

other long-lived assets at fair value when there is an indicator of impairment, and we record them at fair value only when we recognize an impairment loss.

We measure non-financial assets such as other intangible assets, goodwill, and other long-lived assets at fair value when there is an indicator of impairment, and we record them at fair value only when we recognize an impairment loss.

The following table presents the fair value hierarchy for those assets and liabilities we measured at fair value on a recurring basis at April 26, 2025 and April 27, 2024.

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(1) Certain marketable securities investments are measured at fair value using net asset value per share under the practical expedient methodology.

At April 27, 2024 and April 29, 2023, we held marketable securities intended to enhance returns on our cash and to fund future obligations of our non-qualified defined benefit retirement plan, our executive deferred compensation plan and our performance compensation retirement plan.

At April 26, 2025 and April 27, 2024, we held marketable securities to fund future obligations of certain retirement plans.

At April 27, 2024, we also held marketable securities intended to enhance returns on our cash.

The fair value measurements for our Level 1 and Level 2 securities are based on quoted prices in active markets, as well as through broker quotes and independent valuation providers, multiplied by the number of shares owned exclusive of any transaction costs.

At April 27, 2024 and April 29, 2023, we held no Level 3 assets or liabilities with a carrying value.

During fiscal 2023, we recorded a $ 10.3 million impairment charge for one of our Level 3 investments to other income (expense), net in the consolidated statement of income, reducing its carrying value to zero as it was determined the value of the investment was not recoverable.

The following is a reconciliation of our Level 3 assets and liabilities recorded at fair value using significant unobservable inputs for the fiscal year ended April 29, 2023.

(Amounts in thousands) Assets Liabilities

Balance at April 30, 2022 $ 10,079 $ 800

Purchases 237 —

Settlements — —

Fair value adjustment ( 10,316 ) ( 800 )

Balance at April 29, 2023 $ — $ —

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

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-K

Item 8. Financial Statements and Supplementary Data