What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-04-29 compared with 2025-10-29 · 69 added, 171 removed, 204 unchanged (54% of the section changed)

7 unchanged sentences

From our founding in 2002, we have grown rapidly, significantly increasing our sales, store count and profitability.

Headquartered in Phoenix with 464 stores in 24 states as of September 28, 2025, we are one of the largest and fastest growing specialty retailers of fresh, natural and organic food in the United States.

Headquartered in Phoenix with 483 stores in 25 states as of March 29, 2026, we are one of the largest and fastest growing specialty retailers of fresh, natural and organic food in the United States.

Our Growth Strategy

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We are delivering unique smaller stores with expectations of stronger returns, while maintaining the approachable, fresh-focused farmer’s market heritage Sprouts is known for.

From 2021 through September 28, 2025, we have opened 99 new stores and remodeled one store featuring our updated format.

From 2021 through March 29, 2026, we have opened 118 new stores and remodeled one store featuring our updated format.

Our geographic store expansion and new store placement will intersect where our target customers live, in markets with growth potential and supply chain support, which we believe will provide a long runway of approximately 10% annual unit growth.

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We believe our network of distribution centers can drive efficiencies across the chain and support our growth plans.

To further deliver on our fresh commitment and reputation, as well as to increase our local offerings and improve financial results, we aspire to ultimately position fresh distribution centers within a 250-mile radius of stores.

We are better leveraging our existing distribution center capacity, and approximately 80% of our stores were within 250 miles of a distribution center as of September 28, 2025.

To further deliver on our fresh commitment and reputation, as well as to increase our local offerings and improve our financial results, we aspire to ultimately position fresh distribution centers within a 250-mile radius of stores.

As a step to improve our fresh supply chain, in 2025 we began the transition to a self-distribution model for meat and seafood through our fresh distribution centers.

As a result, we are better leveraging our existing distribution center capacity, and approximately 80% of our stores were within 250 miles of a distribution center as of March 29, 2026.

• Customer Engagement and Personalization.

We believe we are elevating our national brand recognition and positioning by telling our unique brand story rooted in product innovation and differentiation.

We are increasing our use of data analytics and insights.

We are increasing our use of data analytics and insights, including through the nationwide launch of our Sprouts Rewards loyalty program in 2025.

We believe this data-driven intelligence will increase customer engagement through personalization efforts with digital and social connections to drive additional sales growth and loyalty.

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Subsequent to the initial launch of our long-term growth strategy, we have added the focus area of inspiring and engaging our talent through our culture, acquisition and development and total rewards program to attract and retain the talent we believe we need to execute on our strategic goals and transform our company into a premier place to work.

• Invest in Technology for Scalable Growth .

• Invest in Technology for Growth .

We continue to make investments in technology in support of our strategy, with a focus on enhancing efficiency, scalability, and customer experience.

While we are showing positive outcomes on our strategic investments in inventory management and customer personalization, we believe that ongoing investments in our

technology foundation will allow us to streamline operations and improve decision making to execute on our strategy.

we are showing positive outcomes on our strategic investments in inventory management and customer personalization, we believe that ongoing investments in our technology foundation will allow us to streamline operations and improve decision making to execute on our strategy.

• Deliver on Key Financial Metrics.

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Since the implementation of our strategy beginning in 2020, we have significantly improved our margin structure above our 2019 baseline.

Recent Developments

On September 3, 2025, we entered into a Distribution Agreement (the “Agreement”) with KeHE Distributors, LLC (“KeHE”), our primary distributor of dry grocery and frozen food products.

The Agreement has a ten-year term and replaces our prior distribution agreement dated July 18, 2018 with KeHE.

The Agreement includes terms relating to KeHE’s distribution of products to us, including product pricing, service level arrangements, product management and distribution procedures, and other ordinary course operational terms governing our distribution relationship with KeHE.

The Agreement is filed as Exhibit 10.2 to this Quarterly Report on Form 10-Q.

Results of Operations for Thirteen Weeks Ended September 28, 2025 and September 29, 2024

Results of Operations for Thirteen Weeks Ended March 29, 2026 and March 30, 2025

The following tables set forth our unaudited results of operations and other operating data for the periods presented.

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Thirteen weeks ended

September 28, 2025 September 29, 2024

March 29, 2026 March 30, 2025

Unaudited Quarterly Consolidated Statement of Income Data:

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Thirteen weeks ended

September 28, 2025 September 29, 2024

March 29, 2026 March 30, 2025

Other Operating Data:

Comparable store sales growth 5.9 % 8.4 %

Comparable store sales (1.7) % 11.7 %

Stores at beginning of period 477 440

Stores at end of period 483 443

Comparison of Thirteen Weeks Ended September 28, 2025 to Thirteen Weeks Ended September 29, 2024

Comparison of Thirteen Weeks Ended March 29, 2026 to Thirteen Weeks Ended March 30, 2025

Thirteen weeks ended

September 28, 2025 September 29, 2024 Change % Change

March 29, 2026 March 30, 2025 Change % Change

Net sales $ 2,329,179 $ 2,236,436 $ 92,743 4 %

Comparable store sales growth 5.9 % 8.4 %

Net sales during the thirteen weeks ended September 28, 2025 totaled $2.2 billion, an increase of $254.7 million, or 13%, compared to the thirteen weeks ended September 29, 2024.

The sales increase was driven by sales from new stores opened in the last twelve months and a 5.9% increase in comparable store sales.

Comparable stores contributed approximately 93% of total sales for the thirteen weeks ended September 28, 2025 and approximately 94% of total sales for the thirteen weeks ended September 29, 2024.

Comparable store sales (1.7) % 11.7 %

Net sales during the thirteen weeks ended March 29, 2026 totaled $2.3 billion, an increase of $92.7 million, or 4%, compared to the thirteen weeks ended March 30, 2025.

The sales increase was driven by sales from new stores opened in the last twelve months, partially offset by a 1.7% decrease in comparable store sales.

Comparable stores contributed approximately 93% of total sales for the thirteen weeks ended March 29, 2026 and March 30, 2025.

Cost of sales and gross profit

Thirteen weeks ended

September 28, 2025 September 29, 2024 Change % Change

March 29, 2026 March 30, 2025 Change % Change

Net sales $ 2,329,179 $ 2,236,436 $ 92,743 4 %

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Gross margin 39.4 % 39.6 % (0.2) %

Gross profit totaled $851.1 million during the thirteen weeks ended September 28, 2025, an increase of $110.1 million, or 15%, compared to the thirteen weeks ended September 29, 2024, driven by increased sales volume.

Gross margin increased by 0.6% to 38.7% for the thirteen weeks ended September 28, 2025, compared to 38.1% for the thirteen weeks ended September 29, 2024, primarily driven by improved shrink.

Gross profit totaled $917.3 million during the thirteen weeks ended March 29, 2026, an increase of $30.9 million, or 3%, compared to the thirteen weeks ended March 30, 2025, driven by increased sales volume from new stores.

Gross margin decreased by 0.2% to 39.4% for the thirteen weeks ended March 29, 2026, compared to 39.6% for the thirteen weeks ended March 30, 2025, primarily driven by the impact from our loyalty program as well as unfavorable shrink.

Selling, general and administrative expenses

Thirteen weeks ended

September 28, 2025 September 29, 2024 Change

March 29, 2026 March 30, 2025 Change

Selling, general and administrative expenses $ 658,781 $ 623,226 $ 35,555 6 %

Percentage of net sales 28.3 % 27.9 % 0.4 %

Selling, general and administrative expenses increased $73.0 million, or 13%, compared to the thirteen weeks ended September 29, 2024.

Selling, general and administrative expenses increased $35.6 million, or 6%, compared to the thirteen weeks ended March 30, 2025.

The increase was primarily due to the increase in new stores opened since the comparable period last year.

As a percentage of net sales, selling, general and administrative expenses

improved slightly as a result of lower compensation expense, which was partially offset by increased benefit costs and pressure from our new store growth.

As a percentage of net sales, selling, general and administrative expenses increased slightly, primarily due to lower comparable store sales during the period, while fixed cost components, including payroll and occupancy expenses, remained relatively consistent.

Depreciation and amortization

Thirteen weeks ended

September 28, 2025 September 29, 2024 Change

March 29, 2026 March 30, 2025 Change

Depreciation and amortization $ 42,027 $ 35,099 $ 6,928 20 %

Percentage of net sales 1.8 % 1.6 % 0.2 %

Depreciation and amortization expense (exclusive of depreciation included in cost of sales) was $38.9 million for the thirteen weeks ended September 28, 2025, compared to $34.4 million for the thirteen weeks ended September 29, 2024.

Depreciation and amortization expense (exclusive of depreciation included in cost of sales) was $42.0 million for the thirteen weeks ended March 29, 2026, compared to $35.1 million for the thirteen weeks ended March 30, 2025.

Depreciation and amortization expense primarily consists of depreciation and amortization for buildings, store leasehold improvements, and equipment for new stores as well as remodel initiatives in older stores.

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Thirteen weeks ended

September 28, 2025 September 29, 2024 Change

March 29, 2026 March 30, 2025 Change

Store closure and other costs, net $ 1,161 $ 1,706 $ (545) (32) %

Percentage of net sales — % 0.1 % (0.1) %

Store closure and other costs, net decreased $2.3 million to $1.5 million for the thirteen weeks ended September 28, 2025, compared to $3.7 million for the thirteen weeks ended September 29, 2024.

Store closure and other costs, net decreased $0.5 million to $1.2 million for the thirteen weeks ended March 29, 2026, compared to $1.7 million for the thirteen weeks ended March 30, 2025.

Store closure and other costs, net primarily consists of ongoing occupancy costs associated with our closed store locations as well as one-time costs associated with disaster recovery activity.

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Thirteen weeks ended

September 28, 2025 September 29, 2024 Change

March 29, 2026 March 30, 2025 Change

Long-term debt $ 196 $ 210 $ (14) (7) %

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Total interest income, net $ (129) $ (924) $ 795 86 %

The decrease in interest income, net for the thirteen weeks ended September 28, 2025 compared to the thirteen weeks ended September 29, 2024 was primarily due to lower average debt outstanding.

The decrease in interest income, net for the thirteen weeks ended March 29, 2026 compared to the thirteen weeks ended March 30, 2025 was primarily due to lower interest rates and invested cash.

See Note 4, “Long-Term Debt and Other Finance Obligations” of our unaudited consolidated financial statements.

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federal income tax rate to pretax income as a result of the following:

The table below provides the updated requirements of ASU no.

2023-09 for the thirteen weeks ended March 29, 2026.

Thirteen weeks ended

September 28, 2025 September 29, 2024

March 29, 2026

Federal statutory rate $ 45,242 21.0 %

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Federal credits (40) — %

Purchase Discount Transferable Tax Credits (1.8) % — %

Transferable Tax Credits (127) — %

Share-based payment awards (4,203) (2.0) %

Return to Provision (0.2) % 0.2 %

Non-deductible Executive Compensation

Other, net (2)

(154) (0.1) %

Effective tax rate $ 51,712 24.0 %

The effective tax rate decreased to 24.0% for the thirteen weeks ended September 28, 2025 from 25.8% for the thirteen weeks ended September 29, 2024.

The decrease in the effective tax rate was primarily due to benefit in the current quarter for purchase discount for transferable tax credits and a favorable return-to-provision adjustment in the current year compared to an unfavorable adjustment in the prior year partially offset by a reduction in the benefit for stock-based compensation in the current year.

Thirteen weeks ended

September 28, 2025 September 29, 2024 Change

Net income $ 120,116 $ 91,610 $ 28,506 31 %

Percentage of net sales 5.5 % 4.7 % 0.8 %

Net income increased $28.5 million primarily due to higher gross profit, partially offset by higher selling, general and administrative expenses for the reasons discussed above.

Diluted earnings per share

(1) State taxes in California made up the majority (greater than 50%) of the tax effect in this category.

(2) Includes items that are immaterial individually and in total.

Thirteen weeks ended

September 28, 2025 September 29, 2024 Change

Diluted earnings per share $ 1.22 $ 0.91 $ 0.31 34 %

Diluted weighted average shares outstanding

98,715 101,025 (2,310)

The increase in diluted earnings per share of $0.31 was driven by higher net income and fewer diluted shares outstanding compared to the prior year due primarily to the share repurchase program.

Results of Operations for Thirty-nine Weeks Ended September 28, 2025 and September 29, 2024

The following tables set forth our unaudited results of operations and other operating data for the periods presented.

The period-to-period comparison of financial results is not necessarily indicative of financial results to be achieved in future periods.

All dollar amounts are in thousands, unless otherwise noted.

Thirty-nine weeks ended

September 28, 2025 September 29, 2024

Unaudited Quarterly Consolidated Statement of Income Data:

Net sales $ 6,657,468 $ 5,723,062

Cost of sales 4,057,454 3,541,461

Gross profit 2,600,014 2,181,601

Selling, general and administrative expenses 1,921,682 1,676,470

Depreciation and amortization (exclusive of depreciation included in cost of sales) 110,567 98,129

Store closure and other costs, net 4,679 8,968

Income from operations 563,086 398,034

Interest income, net (2,045) (382)

Income before income taxes 565,131 398,416

Income tax provision 131,286 97,417

Net income $ 433,845 $ 300,999

Weighted average shares outstanding - basic 98,023 100,560

Diluted effect of equity-based awards 1,063 909

Weighted average shares and equivalent shares outstanding - diluted 99,086 101,469

Diluted net income per share $ 4.38 $ 2.97

Thirty-nine weeks ended

September 28, 2025 September 29, 2024

Other Operating Data:

Comparable store sales growth 9.3 % 6.4 %

Stores at beginning of period 440 407

Stores at end of period 464 428

Comparison of Thirty-nine Weeks Ended September 28, 2025 to Thirty-nine Weeks Ended September 29, 2024

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

Net sales $ 6,657,468 $ 5,723,062 $ 934,406 16 %

Comparable store sales growth 9.3 % 6.4 %

Net sales during the thirty-nine weeks ended September 28, 2025 totaled $6.7 billion, an increase of $934.4 million, or 16%, over the same period of the prior fiscal year.

The sales increase was primarily due to new stores opened in the last twelve months and a 9.3% increase in comparable store sales.

Comparable stores contributed approximately 93% of total sales for the thirty-nine weeks ended September 28, 2025 and approximately 94% of total sales for the thirty-nine weeks ended September 29, 2024.

Cost of sales and gross profit

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

Net sales $ 6,657,468 $ 5,723,062 $ 934,406 16 %

Cost of sales 4,057,454 3,541,461 515,993 15 %

Gross profit 2,600,014 2,181,601 418,413 19 %

Gross margin 39.1 % 38.1 % 1.0 %

Gross profit totaled $2.6 billion during the thirty-nine weeks ended September 28, 2025, an increase of $418.4 million, or 19%, compared to the thirty-nine weeks ended September 29, 2024, driven by increased sales volume.

Gross margin increased to 39.1% for the thirty-nine weeks ended September 28, 2025, compared to 38.1% for the thirty-nine weeks ended September 29, 2024, due to improved inventory management and continued promotional optimization efforts as well as leverage on our supply chain from higher sales.

Selling, general and administrative expenses

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

Selling, general and administrative expenses $ 1,921,682 $ 1,676,470 $ 245,212 15 %

Percentage of net sales 28.9 % 29.3 % (0.4) %

Selling, general and administrative expenses increased by $245.2 million , or 15%, compared to the thirty-nine weeks ended September 29, 2024.

The increase was primarily driven by the increase in new stores opened since the prior year period.

As a percentage of net sales, selling, general and administrative expenses improved as a result of leverage gained from store compensation and occupancy costs.

Depreciation and amortization

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

Depreciation and amortization $ 110,567 $ 98,129 $ 12,438 13 %

Percentage of net sales 1.7 % 1.7 % 0.0 %

Depreciation and amortization expense (exclusive of depreciation included in cost of sales) was $110.6 million for the thirty-nine weeks ended September 28, 2025, compared to $98.1 million for the thirty-nine weeks ended September 29, 2024.

Depreciation and amortization expenses (exclusive of depreciation included in cost of sales) primarily consists of depreciation and amortization for buildings, store leasehold improvements, and equipment.

Store closure and other costs, net

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

Store closure and other costs, net $ 4,679 $ 8,968 $ (4,289) (48) %

Percentage of net sales 0.1 % 0.2 % (0.1) %

Store closure and other costs, net decreased $4.3 million to $4.7 million, compared to $9.0 million for the thirty-nine weeks ended September 29, 2024.

Store closure and other costs, net primarily consists of ongoing occupancy costs associated with our closed store locations as well as one-time costs associated with disaster recovery activity.

Interest (income) expense, net

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

Long-term debt $ 629 $ 4,051 $ (3,422) (84) %

Finance leases 681 569 112 20 %

Deferred financing costs 756 579 177 31 %

Interest income and other (4,111) (5,581) 1,470 26 %

Total interest income, net $ (2,045) $ (382) $ (1,663) (435) %

Interest income, net increased to $2.0 million of income for the thirty-nine weeks ended September 28, 2025, compared to $0.4 million for the thirty-nine weeks ended September 29, 2024 primarily due to lower average debt outstanding and higher interest income earned as a result of higher interest rates.

See Note 4, “Long-Term Debt and Other Finance Obligations” of our unaudited consolidated financial statements.

Income tax provision

Income tax provision differed from the amounts computed by applying the U.S.

federal income tax rate to pretax income as a result of the following:

Thirty-nine weeks ended

September 28, 2025 September 29, 2024

March 30, 2025

Federal statutory rate 21.0 %

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Federal credits (0.2) %

Purchase Discount Transferable Tax Credits (0.5) % — %

Share-based payment awards (5.6) %

Return to Provision (0.1) % 0.1 %

Non-deductible Executive Compensation

1 unchanged sentence

Effective tax rate 20.8 %

The effective tax rate decreased to 23.2% for the thirty-nine weeks ended September 28, 2025 from 24.5% for the thirty-nine weeks ended September 29, 2024.

The decrease in the effective tax rate was primarily due to an increase in the benefit in the current year for stock-based compensation and benefit for purchase discount for transferable tax credits in the current year, partially offset by an increase in the rate detriment in the current year for nondeductible executive compensation, a reduction in the rate benefit for federal employment credits in the current year, and a reduced benefit impact in the current year for enhanced inventory donations in relation to the increase in pre-tax income.

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

The effective tax rate increased to 24.0% for the thirteen weeks ended March 29, 2026 from 20.8% for the thirteen weeks ended March 30, 2025.

The increase in the effective tax rate was primarily driven by a reduction in the benefit for stock-based compensation in the current year partially offset by a decrease in non-deductible executive compensation.

Thirteen weeks ended

March 29, 2026 March 30, 2025 Change

Net income $ 163,724 $ 180,026 $ (16,302) (9) %

Percentage of net sales 7.0 % 8.0 % (1.0) %

Net income increased $132.8 million primarily due to higher gross profit and lower store closure and other costs, partially offset by higher selling, general and administrative expenses for the reasons discussed above.

Net income decreased $16.3 million primarily due to decreased comparable store sales and higher selling, general and administrative expenses for the reasons discussed above.

Diluted earnings per share

Thirty-nine weeks ended

September 28, 2025 September 29, 2024 Change

Thirteen weeks ended

March 29, 2026 March 30, 2025 Change

Diluted earnings per share $ 1.71 $ 1.81 $ (0.10) (6) %

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95,585 99,719 (4,134)

The increase in diluted earnings per share of $1.41 was driven by higher net income and fewer diluted shares outstanding compared to the prior year due primarily to the share repurchase program.

The decrease in diluted earnings per share of $0.10 was driven by lower net income.

Return on Invested Capital

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Rolling Four Quarters Ended

September 28, 2025 September 29, 2024

March 29, 2026 March 30, 2025

(dollars in thousands)

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Interest (income) expense, net of tax (2)

(1,374) (3,003)

Net operating profit after tax (NOPAT) $ 505,994 $ 443,524

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NOPAT, including effect of operating leases $ 601,351 $ 530,964

Average working capital 165,830 192,891

Average net working capital 143,291 171,007

Average property and equipment 1,005,134 858,191

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(2) Net of tax amounts are calculated using the normalized effective tax rate for the periods presented.

(3) 2025 and 2024 estimated interest on operating leases is calculated by multiplying operating leases by the 7.0% and 7.2% discount rate, respectively, for each lease recorded as rent expense within direct store expense.

(3) 2026 and 2025 estimated interest on operating leases is calculated by multiplying operating leases by the discount rate of 7.0% for each lease recorded as rent expense within direct store expense.

(4) Average operating leases represents the average net present value of outstanding lease obligations over the past four trailing quarters.

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The following table sets forth the major sources and uses of cash for each of the periods set forth below, as well as our cash, cash equivalents and restricted cash at the end of each period (in thousands):

Thirty-nine weeks ended

September 28, 2025 September 29, 2024

Thirteen weeks ended

March 29, 2026 March 30, 2025

Cash, cash equivalents and restricted cash at end of period $ 254,805 $ 287,735

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Operating Activities

Cash flows from operating activities increased $57.1 million to $577.5 million for the thirty-nine weeks ended September 28, 2025 compared to $520.4 million for the thirty-nine weeks ended September 29, 2024.

The increase in cash flows from operating activities was primarily a result of higher net income adjusted for non-cash items of $152.5 million partially offset by changes in working capital of $91.0 million and $1.0 million increase in payment on our operating lease liabilities.

Cash flows provided by operating activities from changes in working capital were $23.2 million in the thirty-nine weeks ended September 28, 2025 compared to $114.2 million in the thirty-nine weeks ended September 29, 2024.

Cash flows from operating activities decreased $63.8 million to $235.3 million for the thirteen weeks ended March 29, 2026 compared to $299.1 million for the thirteen weeks ended March 30, 2025.

The decrease in cash flows from operating activities was primarily a result of lower net income adjusted for non-cash items of $4.3 million and changes in working capital of $60.6 million.

Cash flows provided by operating activities from changes in working capital were $17.3 million in the thirteen weeks ended March 29, 2026 compared to $77.9 million in the thirteen weeks ended March 30, 2025.

The $60.6 million decrease in cash flows from changes in working capital was primarily attributable to the following factors, each of which had a negative impact on working capital:

(i) $50.3 million change in inventory related to improving on-shelf availability in certain departments;

(ii) $16.7 million change in accounts payable and accrued liabilities primarily due to timing differences of payments for goods and services;

(iii) $15.2 million change in accrued salaries and benefits primarily driven by increased corporate bonuses;

and (iv) $13.3 million change in prepaid expenses and other current assets primarily driven by lapsing a prepaid income tax position.

These decreases were partially offset by a $10.1 million change in accrued income tax.

Certain other immaterial items combined to result in an additional $5.6 million net decrease in cash flows from changes in working capital.

(i) $56.8 million change in accounts payable and accrued liabilities primarily due to timing differences of payments for goods and services;(ii) $17.5 million change in accrued income tax, (iii) $7.9 million change in accounts receivable driven by the timing of collections, and (iv) $4.8 million change in accrued salaries and benefits primarily driven by increased corporate bonuses.

These decreases were partially offset by a $21.5 million change in prepaid expenses and other current assets and $4.9 million change in inventory.

Investing Activities

Cash flows used in investing activities consist primarily of capital expenditures in new stores, including leasehold improvements and store equipment, capital expenditures to maintain the appearance of our stores, sales enhancing initiatives and other corporate investments as well as cash outlays for acquisitions.

Cash flows used in investing activities were $176.1 million and $161.7 million, for the thirty-nine weeks ended September 28, 2025 and thirty-nine weeks ended September 29, 2024, respectively.

We expect capital expenditures to be in the range of $230 - 250 million in 2025, including expenditures incurred to date, net of estimated landlord tenant improvement allowances, primarily to fund investments in new stores, remodels, maintenance capital expenditures and corporate capital expenditures.

Cash flows used in investing activities were $101.2 million and $59.5 million, for the thirteen weeks ended March 29, 2026 and thirteen weeks ended March 30, 2025, respectively.

We expect capital expenditures to be in the range of $280 million to $310 million in 2026, including expenditures incurred to date, net of estimated landlord tenant improvement allowances, primarily to fund investments in new stores, remodels, maintenance capital expenditures and corporate capital expenditures.

We expect to fund our capital expenditures with cash on hand and cash generated from operating activities.

Financing Activities

Cash flows used in financing activities were $343.1 million for the thirty-nine weeks ended September 28, 2025 compared to $250.8 million for the thirty-nine weeks ended September 29, 2024.

During the thirty-nine weeks ended September 28, 2025, cash flows used in financing activities primarily consisted of $341.9 million for stock repurchases and $$2.1 million for payments of excise tax on stock repurchases partially offset by $1.7 million in proceeds from the exercise of stock options.

During the thirty-nine weeks ended September 29, 2024, cash flows used in financing activities primarily consisted of $125.0 million in payments on our Credit Agreement, $129.7 million for stock repurchases partially offset by $4.7 million in proceeds from the exercise of stock options.

Cash flows used in financing activities were $140.2 million for the thirteen weeks ended March 29, 2026 compared to $219.1 million for the thirteen weeks ended March 30, 2025.

In both periods, the cash flows used in financing activities primarily consisted of stock repurchases.

Long-Term Debt and Credit Facilities

The Company had no long-term debt outstanding as of September 28, 2025 and December 29, 2024.

The Company had no long-term debt outstanding as of March 29, 2026 and December 28, 2025.

See Note 4, “Long-Term Debt and Other Finance Obligations” of our unaudited consolidated financial statements for a description of our Credit Agreement and our Former Credit Facility (each as defined therein).

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Our board of directors from time to time authorizes share repurchase programs for our common stock.

The following table outlines the share repurchase program authorized by our board, and the related repurchase activity and available authorization as of September 28, 2025:

The following table outlines the share repurchase program authorized by our board, and the related repurchase activity and available authorization as of March 29, 2026:

Effective date Expiration date Amount

6 unchanged sentences

Share repurchase activity under our repurchase program for the periods indicated was as follows (total cost in thousands):

Thirteen weeks ended Thirty-nine weeks ended

September 28, 2025 September 29, 2024 September 28, 2025 September 29, 2024

Thirteen weeks ended

March 29, 2026 March 30, 2025

Number of common shares acquired 1,888,274 1,568,017

3 unchanged sentences

The cost of common shares repurchased included the 1% excise tax imposed as part of the Inflation Reduction Act of 2022.

Subsequent to September 28, 2025 and through October 27, 2025, we repurchased an additional 0.1 million shares of common stock for $10.0 million, excluding excise tax.

Subsequent to March 29, 2026 and through April 27, 2026, we repurchased an additional 0.5 million shares of common stock for $40.0 million, excluding excise tax.

Contractual Obligations

Our principal contractual obligations and commitments arising in the normal course of business consist of obligations under our Credit Agreement, interest on our Credit Agreement, operating and finance leases, purchase commitments and self-insurance liabilities.

Except as otherwise disclosed in Note 4, “Long-Term Debt and Finance Lease Liabilities” and Note 6, "Commitments and Contingencies" of our unaudited consolidated financial statements, there have been no material changes outside the normal course of business as of September 28, 2025 in our contractual obligations and commitments from those reported in our Annual Report on Form 10-K for the fiscal year ended December 29, 2024.

Except as otherwise disclosed in Note 4, “Long-Term Debt and Other Finance Obligations” and Note 6, "Commitments and Contingencies" of our unaudited consolidated financial statements, there have been no material changes outside the normal course of business as of March 29, 2026 in our contractual obligations and commitments from those reported in our Annual Report on Form 10-K for the fiscal year ended December 28, 2025.

Impact of Inflation and Deflation

13 unchanged sentences

To the extent that there are material differences between these estimates and our actual results, our future financial statements will be affected.

There have been no substantial changes to these estimates, or the policies related to them during the thirteen and thirty-nine weeks ended September 28, 2025.

For a full discussion of these estimates and policies, see “Critical Accounting Estimates” in Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 29, 2024.

There have been no substantial changes to these estimates, or the policies related to them during the thirteen weeks ended March 29, 2026.

For a full discussion of these estimates and policies, see "Management's Discussion and Analysis of Financial Condition and Results of Operations — Critical Accounting Estimates” in Part II — Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 28, 2025.

Recently Issued Accounting Pronouncements

1 unchanged sentence

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