What changed in this filing

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Item 1. Financial Statements

2025-03-11 compared with 2024-12-10 · 193 added, 109 removed, 547 unchanged (36% of the section changed)

35 unchanged sentences

Common stock, $ 0.01 par value, authorized 100.0 shares;

62.4 shares issued and 59.9 shares outstanding at November 2, 2024;

63.0 shares issued and 60.5 shares outstanding at February 1, 2025;

62.0 shares issued and 59.5 shares outstanding at August 3, 2024

13 unchanged sentences

(in millions, except for per share data)

13-Week Period Ended

2024 October 28,

13-Week Period Ended 26-Week Period Ended

2025 January 27,

2024 February 1,

2025 January 27,

Net sales $ 8,158 $ 7,775 $ 16,029 $ 15,327

4 unchanged sentences

Loss on sale of assets and other asset charges 5 5 11 24

Operating income (loss) 5 ( 16 )

Operating income 27 16 32 —

Net periodic benefit income, excluding service cost ( 5 ) ( 4 ) ( 10 ) ( 7 )

19 unchanged sentences

(in millions)

13-Week Period Ended

2024 October 28,

13-Week Period Ended 26-Week Period Ended

2025 January 27,

2024 February 1,

2025 January 27,

Net loss including noncontrolling interests $ ( 2 ) $ ( 14 ) $ ( 22 ) $ ( 53 )

Other comprehensive income (loss):

Other comprehensive (loss) income:

Recognition of pension and other postretirement benefit obligations, net of tax — 1 — 1

Recognition of interest rate swap cash flow hedges, net of tax (1)

1 ( 4 ) 3 ( 7 )

Foreign currency translation adjustments ( 3 ) 2 ( 3 ) ( 1 )

Recognition of other cash flow derivatives, net of tax 1 ( 1 ) 1 —

Total other comprehensive income (loss)

Total other comprehensive (loss) income ( 1 ) ( 2 ) 1 ( 7 )

Less comprehensive income attributable to noncontrolling interests ( 1 ) ( 1 ) ( 2 ) ( 1 )

1 unchanged sentence

$ ( 4 ) $ ( 17 ) $ ( 23 ) $ ( 61 )

(1) Amounts are net of tax expense (benefit) of $ 1 million and $( 1 ) million for the first quarters of fiscal 2025 and 2024, respectively.

(1) Amounts are net of tax expense (benefit) of $ 0 million and $( 1 ) million for the second quarters of fiscal 2025 and 2024, respectively, and $ 1 million and $( 2 ) million for fiscal 2025 and 2024 year-to-date, respectively.

See accompanying Notes to Condensed Consolidated Financial Statements.

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited)

For the 13-week periods ended November 2, 2024 and October 28, 2023

For the 13-week periods ended February 1, 2025 and January 27, 2024

(in millions)

4 unchanged sentences

Shares Amount Shares Amount

Balances at November 2, 2024 62.4 $ 1 2.5 $ ( 86 ) $ 638 $ ( 45 ) $ 1,117 $ 1,625 $ — $ 1,625

Restricted stock vestings 0.6 — — — ( 5 ) — — ( 5 ) — ( 5 )

Share-based compensation — — — — 9 — — 9 — 9

Other comprehensive loss — — — — — ( 1 ) — ( 1 ) — ( 1 )

Distributions to noncontrolling interests — — — — — — — — ( 1 ) ( 1 )

Net (loss) income — — — — — — ( 3 ) ( 3 ) 1 ( 2 )

Balances at February 1, 2025 63.0 $ 1 2.5 $ ( 86 ) $ 642 $ ( 46 ) $ 1,114 $ 1,625 $ — $ 1,625

Balances at October 28, 2023 61.9 $ 1 2.5 $ ( 86 ) $ 606 $ ( 33 ) $ 1,211 $ 1,699 $ — $ 1,699

Share-based compensation — — — — 10 — — 10 — 10

Other comprehensive loss — — — — — ( 2 ) — ( 2 ) — ( 2 )

Distributions to noncontrolling interests — — — — — — — — ( 1 ) ( 1 )

Net (loss) income — — — — — — ( 15 ) ( 15 ) 1 ( 14 )

Balances at January 27, 2024 61.9 $ 1 2.5 $ ( 86 ) $ 616 $ ( 35 ) $ 1,196 $ 1,692 $ — $ 1,692

See accompanying Notes to Condensed Consolidated Financial Statements.

UNITED NATURAL FOODS, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited)

For the 26-week periods ended February 1, 2025 and January 27, 2024

(in millions)

Common Stock Treasury Stock Additional

Paid-in Capital Accumulated

Comprehensive Loss Retained Earnings Total United Natural Foods, Inc.

Stockholders’ Equity Noncontrolling Interests Total Stockholders’ Equity

Shares Amount Shares Amount

Balances at August 3, 2024 62.0 $ 1 2.5 $ ( 86 ) $ 635 $ ( 47 ) $ 1,138 $ 1,641 $ — $ 1,641

4 unchanged sentences

Net (loss) income — — — — — — ( 24 ) ( 24 ) 2 ( 22 )

Balances at November 2, 2024 62.4 $ 1 2.5 $ ( 86 ) $ 638 $ ( 45 ) $ 1,117 $ 1,625 $ — $ 1,625

Balances at February 1, 2025 63.0 $ 1 2.5 $ ( 86 ) $ 642 $ ( 46 ) $ 1,114 $ 1,625 $ — $ 1,625

Balances at July 29, 2023 61.0 $ 1 2.5 $ ( 86 ) $ 606 $ ( 28 ) $ 1,250 $ 1,743 $ 1 $ 1,744

3 unchanged sentences

Distributions to noncontrolling interests — — — — — — — — ( 2 ) ( 2 )

Net loss — — — — — — ( 39 ) ( 39 ) — ( 39 )

Balances at October 28, 2023 61.9 $ 1 2.5 $ ( 86 ) $ 606 $ ( 33 ) $ 1,211 $ 1,699 $ — $ 1,699

Net (loss) income — — — — — — ( 54 ) ( 54 ) 1 ( 53 )

Balances at January 27, 2024 61.9 $ 1 2.5 $ ( 86 ) $ 616 $ ( 35 ) $ 1,196 $ 1,692 $ — $ 1,692

See accompanying Notes to Condensed Consolidated Financial Statements.

3 unchanged sentences

26-Week Period Ended

(in millions) November 2,

2024 October 28,

(in millions) February 1,

2025 January 27,

CASH FLOWS FROM OPERATING ACTIVITIES:

Net loss including noncontrolling interests $ ( 22 ) $ ( 53 )

Adjustments to reconcile loss to net cash used in operating activities:

Adjustments to reconcile loss to net cash provided by (used in) operating activities:

Depreciation and amortization 161 152

12 unchanged sentences

Accrued expenses and other liabilities ( 125 ) 179

Net cash used in operating activities

( 110 ) ( 254 )

Net cash provided by (used in) operating activities

CASH FLOWS FROM INVESTING ACTIVITIES:

7 unchanged sentences

Proceeds from borrowings under revolving credit line 1,120 1,422

Proceeds from issuance of other loans — 14

Repayments of borrowings under revolving credit line ( 1,133 ) ( 1,180 )

1 unchanged sentence

Payments of employee restricted stock tax withholdings ( 9 ) ( 6 )

Payments for debt issuance costs ( 1 ) —

Distributions to noncontrolling interests ( 2 ) ( 2 )

Other — ( 1 )

Net cash provided by financing activities

Net cash (used in) provided by financing activities

EFFECT OF EXCHANGE RATE ON CASH ( 1 ) —

NET DECREASE IN CASH AND CASH EQUIVALENTS ( 3 ) —

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

Cash and cash equivalents, at beginning of period 40 37

16 unchanged sentences

The Company’s fiscal years end on the Saturday closest to July 31 and contain either 52 or 53 weeks.

References to the first quarter of fiscal 2025 and 2024 relate to the 13-week fiscal quarters ended November 2, 2024 and October 28, 2023, respectively.

References to the second quarter of fiscal 2025 and 2024 relate to the 13-week fiscal quarters ended February 1, 2025 and January 27, 2024, respectively.

References to fiscal 2025 and 2024 year-to-date relate to the 26-week fiscal periods ended February 1, 2025 and January 27, 2024, respectively.

Basis of Presentation

18 unchanged sentences

Checks outstanding in excess of bank balances create book overdrafts, which are recorded in Accounts payable in the Condensed Consolidated Balance Sheets and are reflected as an operating activity in the Condensed Consolidated Statements of Cash Flows.

As of November 2, 2024 and August 3, 2024, the Company had net book overdrafts of $ 293 million and $ 243 million, respectively.

As of February 1, 2025 and August 3, 2024, the Company had net book overdrafts of $ 284 million and $ 243 million, respectively.

Inventories, Net

4 unchanged sentences

Allowances for inventory shortages are recorded based on the results of these counts.

The LIFO reserve was $ 358 million and $ 351 million as of November 2, 2024 and August 3, 2024, respectively, which is recorded within Inventories, net on the Condensed Consolidated Balance Sheets.

The LIFO reserve was $ 361 million and $ 351 million as of February 1, 2025 and August 3, 2024, respectively, which is recorded within Inventories, net on the Condensed Consolidated Balance Sheets.

NOTE 2—RECENTLY ADOPTED AND ISSUED ACCOUNTING PRONOUNCEMENTS

34 unchanged sentences

Disaggregation of Revenues

The Company records revenue to five customer channels within Net sales, which are described below:

• Chains , which consists of customer accounts that typically have more than 10 operating stores and excludes stores included within the Supernatural and Other channels defined below;

• Independent retailers , which includes smaller size accounts including single store and multiple store locations, and group purchasing entities that are not classified within Chains above or Other defined below;

• Supernatural , which consists of chain accounts that are national in scope and carry primarily natural products, and currently consists solely of one customer;

• Retail , which reflects the Company’s Retail segment, including Cub® Foods and Shoppers® stores;

• Other , which includes international customers outside of Canada, foodservice, eCommerce, conventional military business and other sales.

The following tables detail the Company’s Net sales for the periods presented by customer channel for each of its segments.

In the second quarter of fiscal 2025, the Company announced that it is realigning its commercial wholesale organization into two product-centered business divisions to enhance service to its customers and suppliers with commercial teams providing a more customized product and service-centered experience.

These two divisions are Conventional Grocery Products and Natural, Organic, Specialty & Fresh Products.

Each commercial division will have focused sales teams aligned to the unique product and service needs of its retail customers.

The Company updated its presentation of disaggregated revenue to align with how management evaluates its top-line commercial and financial performance.

Prior period disaggregation of revenue amounts have been recast to conform with the Company’s current period presentation.

The Company continues to effect the changes necessary to complete the divisional realignment.

The Company disaggregates revenue into the following three categories based on product and service offerings:

• Natural , which primarily reflects the wholesale distribution of natural, organic and specialty grocery and non-food products and services and includes the Company’s portfolio of natural owned brands and natural and organic snack food manufacturing business;

• Conventional , which primarily reflects the wholesale distribution of conventional grocery and non-food products and services and includes the Company’s portfolio of conventional owned brands;

• Retail , which reflects the Company’s grocery and liquor stores operating under the Cub® Foods and Shoppers® banners that sell products directly to consumers.

The following tables detail the Company’s Net sales for the periods presented by the aforementioned categories for each of its segments.

The Company does not record its revenues within its Wholesale reportable segment for financial reporting purposes by product group, and it is therefore impracticable for it to report them accordingly.

Net Sales for the 13-Week Period Ended

(in millions) November 2, 2024

Customer Channel Wholesale Retail Other Eliminations (1)

Chains $ 3,294 $ — $ — $ — $ 3,294

Independent retailers 1,853 — — — 1,853

Supernatural 1,835 — — — 1,835

13-Week Period Ended February 1, 2025

(in millions)

Wholesale Retail Other Eliminations (1)

Natural $ 4,011 $ — $ 53 $ ( 43 ) $ 4,021

Conventional 3,861 — — — 3,861

Retail — 610 — — 610

Other 608 — 58 — 666

Eliminations — — — ( 334 ) ( 334 )

Total $ 7,872 $ 610 $ 53 $ ( 377 ) $ 8,158

Net Sales for the 13-Week Period Ended

(in millions) October 28, 2023

Customer Channel Wholesale Retail Other Eliminations (1)

Chains $ 3,184 $ — $ — $ — $ 3,184

Independent retailers 1,899 — — — 1,899

Supernatural 1,612 1,612

13-Week Period Ended January 27, 2024 (2)

(in millions)

Wholesale Retail Other Eliminations (1)

Natural $ 3,704 $ — $ 52 $ ( 41 ) $ 3,715

Conventional 3,783 — — — 3,783

Retail — 631 — — 631

Other 586 — 60 — 646

Eliminations — — — ( 354 ) ( 354 )

Total $ 7,487 $ 631 $ 52 $ ( 395 ) $ 7,775

26-Week Period Ended February 1, 2025

(in millions)

Wholesale Retail Other Eliminations (1)

Natural $ 7,837 $ — $ 111 $ ( 89 ) $ 7,859

Conventional 7,625 — — — 7,625

Retail — 1,196 — — 1,196

Eliminations — — — ( 651 ) ( 651 )

Total $ 15,462 $ 1,196 $ 111 $ ( 740 ) $ 16,029

26-Week Period Ended January 27, 2024 (2)

(in millions)

Wholesale Retail Other Eliminations (1)

Natural $ 7,273 $ — $ 112 $ ( 93 ) $ 7,292

Conventional 7,495 — — — 7,495

Retail — 1,237 — — 1,237

Eliminations — — — ( 697 ) ( 697 )

Total $ 14,768 $ 1,237 $ 112 $ ( 790 ) $ 15,327

(1) Eliminations primarily includes the net sales elimination of Wholesale to Retail sales and the elimination of sales from segments included within Other to Wholesale.

(2) In the second quarter of fiscal 2025, the Company updated its presentation of disaggregated revenue as described above.

Prior period disaggregation of revenue amounts in the above tables have been recast to conform with the Company’s current period presentation.

There was no impact to the Condensed Consolidated Statements of Operations as a result.

The Company serves customers in the United States and Canada, as well as customers located in other countries.

3 unchanged sentences

Accounts and notes receivable are as follows:

(in millions) November 2, 2024 August 3, 2024

(in millions) February 1, 2025 August 3, 2024

Customer accounts receivable $ 999 $ 936

5 unchanged sentences

In fiscal 2023, the Company entered into an agreement to sell, on a revolving basis, certain customer accounts receivable to a third-party financial institution.

Accounts receivable that the Company is servicing on behalf of the financial institution, which would have otherwise been outstanding as of November 2, 2024 and August 3, 2024, was approximately $ 277 million and $ 322 million, respectively.

Accounts receivable that the Company is servicing on behalf of the financial institution, which would have otherwise been outstanding as of February 1, 2025 and August 3, 2024, was approximately $ 311 million and $ 322 million, respectively.

Net proceeds received are included within cash from operating activities in the Condensed Consolidated Statements of Cash Flows in the period of sale.

The loss on sale of receivables was $ 5 million and $ 5 million for the first quarters of fiscal 2025 and 2024, respectively, and is recorded within Loss on sale of assets and other asset charges in the Condensed Consolidated Statements of Operations.

The loss on sale of receivables was $ 4 million and $ 5 million for the second quarters of fiscal 2025 and 2024, respectively, and $ 9 million and $ 10 million for fiscal 2025 and 2024 year-to-date, respectively, and is recorded within Loss on sale of assets and other asset charges in the Condensed Consolidated Statements of Operations.

NOTE 4—RESTRUCTURING, ACQUISITION AND INTEGRATION RELATED EXPENSES

Restructuring, acquisition and integration related expenses were as follows:

13-Week Period Ended

(in millions) November 2, 2024 October 28, 2023

13-Week Period Ended 26-Week Period Ended

(in millions) February 1, 2025 January 27, 2024 February 1, 2025 January 27, 2024

Restructuring and integration costs $ 5 $ 4 $ 16 $ 8

2 unchanged sentences

Restructuring and Integration Costs

Restructuring and integration costs for the first quarters of fiscal 2025 and 2024 primarily relate to costs associated with certain employee severance and other employee separation costs.

Restructuring liabilities related to severance and other employee separation costs were $ 22 million and $ 16 million as of November 2, 2024 and August 3, 2024, respectively, and are included in Accrued expenses and other current liabilities and Accrued compensation and benefits in the Condensed Consolidated Balance Sheets.

Changes in the liability for the first quarter of fiscal 2025 included $ 10 million attributable to restructuring and severance-related charges offset by $ 4 million attributable to cash settlements from the prior period balance.

Restructuring and integration costs for the second quarters and year-to-date fiscal 2025 and 2024 primarily relate to costs associated with certain employee severance and other employee separation costs.

Restructuring liabilities related to severance and other employee separation costs were $ 22 million and $ 16 million as of February 1, 2025 and August 3, 2024, respectively, and are included in Accrued expenses and other current liabilities and Accrued compensation and benefits in the Condensed Consolidated Balance Sheets.

Changes in the liability for severance and other employee separation costs for the 26-week period ended February 1, 2025 included $ 14 million attributable to restructuring and severance-related charges offset by $ 8 million attributable to cash settlements from the prior period balance.

NOTE 5—GOODWILL AND INTANGIBLE ASSETS, NET

3 unchanged sentences

Change in foreign exchange rates — — —

Goodwill as of November 2, 2024

(1) Wholesale amounts are net of accumulated goodwill impairment charges of $ 717 million as of August 3, 2024 and November 2, 2024.

(2) Other amounts are net of accumulated goodwill impairment charges of $ 10 million as of August 3, 2024 and November 2, 2024.

Goodwill as of February 1, 2025

(1) Wholesale amounts are net of accumulated goodwill impairment charges of $ 717 million as of August 3, 2024 and February 1, 2025.

(2) Other amounts are net of accumulated goodwill impairment charges of $ 10 million as of August 3, 2024 and February 1, 2025.

Identifiable intangible assets, net consisted of the following:

November 2, 2024 August 3, 2024

February 1, 2025 August 3, 2024

(in millions) Gross Carrying

12 unchanged sentences

Intangibles assets, net $ 1,154 $ 543 $ 611 $ 1,159 $ 510 $ 649

Amortization expense was $ 18 million for the first quarters of fiscal 2025 and 2024.

The estimated future amortization expense for each of the next five fiscal years and thereafter on amortizing intangible assets existing as of November 2, 2024 is as shown below:

Amortization expense was $ 18 million for the second quarters of fiscal 2025 and 2024, and $ 36 million for fiscal 2025 and 2024 year-to-date.

The estimated future amortization expense for each of the next five fiscal years and thereafter on amortizing intangible assets existing as of February 1, 2025 is as shown below:

(in millions)

4 unchanged sentences

The following tables provide the fair value hierarchy for financial assets and liabilities measured on a recurring basis:

Condensed Consolidated Balance Sheets Location Fair Value at November 2, 2024

Condensed Consolidated Balance Sheets Location Fair Value at February 1, 2025

(in millions) Level 1 Level 2 Level 3

1 unchanged sentence

Foreign currency derivatives designated as hedging instruments Prepaid expenses and other current assets $ — $ 1 $ —

Interest rate swaps designated as hedging instruments Other long term assets $ — $ 1 $ —

Fuel derivatives designated as hedging instruments Accrued expenses and other current liabilities $ — $ 1 $ —

Interest rate swaps designated as hedging instruments Other long-term liabilities $ — $ 1 $ —

Condensed Consolidated Balance Sheets Location Fair Value at August 3, 2024

7 unchanged sentences

The interest rate swap contracts are valued using an income approach interest rate swap valuation model incorporating observable market inputs including interest rates, Secured Overnight Financing Rate (“SOFR”) swap rates and credit default swap rates.

As of November 2, 2024, a 100-basis point increase in forward SOFR interest rates would increase the fair value of the interest rate swaps by approximately $ 14 million;

As of February 1, 2025, a 100-basis point increase in forward SOFR interest rates would increase the fair value of the interest rate swaps by approximately $ 12 million;

a 100-basis point decrease in forward SOFR interest rates would decrease the fair value of the interest rate swaps by approximately $ 13 million.

5 unchanged sentences

In the table below, the carrying value of the Company’s long-term debt is net of original issue discounts and debt issuance costs.

November 2, 2024 August 3, 2024

February 1, 2025 August 3, 2024

(in millions) Carrying Value Fair Value Carrying Value Fair Value

5 unchanged sentences

Interest rate swap contracts are entered into for periods consistent with related underlying exposures and do not constitute positions independent of those exposures.

The Company’s interest rate swap contracts are designated as cash flow hedges as of November 2, 2024.

The Company’s interest rate swap contracts are designated as cash flow hedges as of February 1, 2025.

Interest rate swap contracts are reflected at their fair values in the Condensed Consolidated Balance Sheets.

Refer to Note 6—Fair Value Measurements of Financial Instruments for further information on the fair value of interest rate swap contracts.

Details of active swap contracts as of November 2, 2024, which are all pay fixed and receive floating, are as follows:

Details of active swap contracts as of February 1, 2025, which are all pay fixed and receive floating, are as follows:

Effective Date Swap Maturity Notional Value (in millions) Pay Fixed Rate Receive Floating Rate Floating Rate Reset Terms

14 unchanged sentences

The Company also monitors the risk of counterparty default on an ongoing basis and noted that the counterparties are reputable financial institutions.

The entire change in the fair value of the derivative is initially reported in Other comprehensive loss (outside of earnings) in the Condensed Consolidated Statements of Comprehensive Loss and subsequently reclassified to earnings in Interest expense, net in the Condensed Consolidated Statements of Operations when the hedged transactions affect earnings.

The entire change in the fair value of the derivative is initially reported in Other comprehensive (loss) income (outside of earnings) in the Condensed Consolidated Statements of Comprehensive Loss and subsequently reclassified to earnings in Interest expense, net in the Condensed Consolidated Statements of Operations when the hedged transactions affect earnings.

The location and amount of gains or losses recognized in the Condensed Consolidated Statements of Operations for interest rate swap contracts for each of the periods, presented on a pre-tax basis, are as follows:

13-Week Period Ended

November 2, 2024 October 28, 2023

(in millions) Interest expense, net

13-Week Period Ended 26-Week Period Ended

February 1, 2025 January 27, 2024 February 1, 2025 January 27, 2024

(in millions) Interest expense, net Interest expense, net

Total amounts of expense line items presented in the Condensed Consolidated Statements of Operations in which the effects of cash flow hedges are recorded

$ 38 $ 40 $ 74 $ 75

Gain on cash flow hedging relationships:

Gain reclassified from comprehensive loss into earnings

$ 2 $ 5 $ 6 $ 10

NOTE 8—LONG-TERM DEBT

1 unchanged sentence

(in millions) Average Interest Rate at

November 2, 2024

Fiscal Maturity Year November 2,

February 1, 2025

Fiscal Maturity Year February 1,

2025 August 3,

18 unchanged sentences

The Term Loan Facility is secured by (i) a first-priority lien on substantially all assets other than the ABL Assets (defined below) and (ii) a second-priority lien on substantially all of the ABL Assets, in each case, subject to customary exceptions and limitations, including an exception for owned real property (other than distribution centers) with net book values of less than or equal to $ 10 million.

As of November 2, 2024 and August 3, 2024, there was $ 676 million and $ 686 million, respectively, of owned real property pledged as collateral that was included in Property and equipment, net in the Condensed Consolidated Balance Sheets.

As of November 2, 2024, the borrowings under the Term Loan Facility bear interest at rates that, at the Term Borrowers’ option, can be either:

As of February 1, 2025 and August 3, 2024, there was $ 660 million and $ 686 million, respectively, of owned real property pledged as collateral that was included in Property and equipment, net in the Condensed Consolidated Balance Sheets.

As of February 1, 2025, the borrowings under the Term Loan Facility bear interest at rates that, at the Term Borrowers’ option, can be either:

(i) a base rate plus a margin of 3.75 % or (ii) a SOFR rate plus a margin of 4.75 %, provided that the SOFR rate shall never be less than 0.0 %.

4 unchanged sentences

The applicable margins and letter of credit fees under the ABL Credit Facility are variable and are dependent upon the prior fiscal quarter’s daily average Availability (as defined in the ABL Loan Agreement), and were as follows:

Range of Facility Rates and Fees (per annum) November 2, 2024

Range of Facility Rates and Fees (per annum) February 1, 2025

Applicable margin for revolver base rate loans 0.00 % - 0.25 %

9 unchanged sentences

Availability under the ABL Credit Facility is subject to a borrowing base consisting of specified percentages of the value of eligible accounts receivable, credit card receivables, inventory, pharmacy receivables and pharmacy prescription files, after adjusting for customary reserves, but at no time shall exceed the aggregate commitments plus the outstanding ABL FILO Loans under the ABL Credit Facility (currently $ 2,730 million).

As of November 2, 2024, the borrowing base was $ 2,589 million, reflecting the advance rates described above and $ 110 million of reserves, which is below the $ 2,730 million limit of availability.

As of February 1, 2025, the borrowing base was $ 2,545 million, reflecting the advance rates described above and $ 108 million of reserves, which is below the $ 2,730 million limit of availability.

This resulted in total availability of $ 2,545 million for loans and letters of credit under the ABL Credit Facility.

The Company’s unused credit under the ABL Credit Facility was as follows:

(in millions) November 2, 2024

(in millions) February 1, 2025

Total availability for ABL loans and letters of credit $ 2,545

5 unchanged sentences

NOTE 9—COMPREHENSIVE LOSS AND ACCUMULATED OTHER COMPREHENSIVE LOSS

Changes in Accumulated other comprehensive loss by component, net of tax, for the first quarter of fiscal 2025 were as follows:

Changes in Accumulated other comprehensive loss by component, net of tax, for fiscal 2025 year-to-date were as follows:

(in millions) Other Cash Flow Derivatives Benefit Plans Foreign Currency Translation Swap Agreements Total

Accumulated other comprehensive loss at August 3, 2024 $ — $ ( 22 ) $ ( 24 ) $ ( 1 ) $ ( 47 )

Other comprehensive income before reclassifications 1 — — 5 6

Other comprehensive income (loss) before reclassifications 2 — ( 3 ) 7 6

Amortization of cash flow hedges ( 1 ) — — ( 4 ) ( 5 )

Net current period Other comprehensive income — — — 2 2

Accumulated other comprehensive (loss) income at November 2, 2024 $ — $ ( 22 ) $ ( 24 ) $ 1 $ ( 45 )

Changes in Accumulated other comprehensive loss by component, net of tax, for the first quarter of fiscal 2024 were as follows:

Net current period Other comprehensive income (loss) 1 — ( 3 ) 3 1

Accumulated other comprehensive income (loss) at February 1, 2025 $ 1 $ ( 22 ) $ ( 27 ) $ 2 $ ( 46 )

Changes in Accumulated other comprehensive loss by component, net of tax, for fiscal 2024 year-to-date were as follows:

(in millions) Other Cash Flow Derivatives Benefit Plans Foreign Currency Translation Swap Agreements Total

Accumulated other comprehensive (loss) income at July 29, 2023 $ — $ ( 21 ) $ ( 21 ) $ 14 $ ( 28 )

Other comprehensive income (loss) before reclassifications 1 — ( 3 ) 1 ( 1 )

Other comprehensive loss before reclassifications — — ( 1 ) — ( 1 )

Amortization of amounts included in net periodic benefit income — 1 — — 1

Amortization of cash flow hedges — — — ( 7 ) ( 7 )

Net current period Other comprehensive income (loss) — 1 ( 1 ) ( 7 ) ( 7 )

Accumulated other comprehensive income (loss) at October 28, 2023 $ 1 $ ( 21 ) $ ( 24 ) $ 11 $ ( 33 )

Accumulated other comprehensive (loss) income at January 27, 2024 $ — $ ( 20 ) $ ( 22 ) $ 7 $ ( 35 )

Items reclassified out of Accumulated other comprehensive loss had the following impact on the Condensed Consolidated Statements of Operations:

13-Week Period Ended Affected Line Item on the Condensed Consolidated Statements of Operations

(in millions) November 2,

2024 October 28,

13-Week Period Ended 26-Week Period Ended Affected Line Item on the Condensed Consolidated Statements of Operations

(in millions) February 1,

2025 January 27,

2024 February 1,

2025 January 27,

Pension and postretirement benefit plan net assets:

Amortization of amounts included in net periodic benefit income (1)

$ — $ 1 $ — $ 1 Net periodic benefit income, excluding service cost

Income tax benefit — — — — Benefit for income taxes

Total reclassifications, net of tax $ — $ 1 $ — $ 1

Swap agreements:

6 unchanged sentences

Total reclassifications, net of tax $ — $ — $ ( 1 ) $ —

As of November 2, 2024, the Company expects to reclassify $ 5 million related to unrealized derivative gains out of Accumulated other comprehensive loss and primarily into Interest expense, net during the following twelve-month period.

(1) Reclassification of amounts included in net periodic benefit income include reclassification of prior service cost as reflected in Note 10—Benefit Plans.

As of February 1, 2025, the Company expects to reclassify $ 5 million related to unrealized derivative gains out of Accumulated other comprehensive loss and primarily into Interest expense, net during the following twelve-month period.

NOTE 10—BENEFIT PLANS

Net periodic benefit (income) costs for defined benefit pension plans consisted of the following:

Net periodic benefit (income) costs for defined benefit pension and other postretirement benefit plans consisted of the following:

13-Week Period Ended

(in millions) November 2, 2024 October 28, 2023

Pension Benefits Other Postretirement Benefits

(in millions) February 1, 2025 January 27, 2024 February 1, 2025 January 27, 2024

Interest cost $ 18 $ 18 $ — $ —

Expected return on plan assets ( 23 ) ( 23 ) — —

Amortization of prior service cost — — — 1

Net periodic benefit income $ ( 5 ) $ ( 5 ) $ — $ 1

Other postretirement benefits costs were de minimis for the first quarters of fiscal 2025 and 2024.

26-Week Period Ended

Pension Benefits Other Postretirement Benefits

(in millions) February 1, 2025 January 27, 2024 February 1, 2025 January 27, 2024

Interest cost $ 36 $ 37 $ — $ —

Expected return on plan assets ( 46 ) ( 45 ) — —

Amortization of prior service cost — — — 1

Net periodic benefit income $ ( 10 ) $ ( 8 ) $ — $ 1

Contributions

2 unchanged sentences

The Company expects to contribute approximately $ 1 million to its other defined benefit pension plans and $ 1 million to its postretirement benefit plans in fiscal 2025.

Contributions for the first quarters of fiscal 2025 and 2024 were de minimis.

Contributions for the second quarters and year-to-date fiscal 2025 and 2024 were de minimis.

Multiemployer Pension Plans

The Company contributed $ 13 million in the first quarters of fiscal 2025 and 2024, to multiemployer pension plans, which contributions are included within Operating expenses.

The Company contributed $ 12 million and $ 13 million in the second quarters of fiscal 2025 and 2024, respectively, and $ 25 million and $ 26 million in fiscal 2025 and 2024 year-to-date, respectively, to multiemployer pension plans, which contributions are included within Operating expenses.

NOTE 11—INCOME TAXES

The effective tax rate for the first quarter of fiscal 2025 was a benefit rate of 16.7 % on pre-tax loss compared to a benefit rate of 18.8 % on pre-tax loss for the first quarter of fiscal 2024.

The change from the first quarter of fiscal 2024 is primarily driven by an increase in state net operating loss valuation allowances for the first quarter of fiscal 2025.

The primary drivers for the variation between the Company’s statutory tax rate and its effective tax rate were state net operating loss valuation allowances for the first quarter of fiscal 2025, and discrete tax detriments resulting from share award vestings for the first quarters of fiscal 2025 and fiscal 2024.

The effective tax rate for the second quarter of fiscal 2025 was a benefit rate of 60.0 % on pre-tax loss compared to a benefit rate of 26.3 % on pre-tax loss for the second quarter of fiscal 2024.

The change from the second quarter of fiscal 2024 is primarily driven by a reduction in pre-tax loss combined with discrete tax benefits resulting from share award vestings in the second quarter of fiscal 2025.

The primary drivers for the variation between the Company’s statutory tax rate and its effective tax rate were state net operating loss valuation allowances and discrete tax benefits resulting from share award vestings for the second quarter of fiscal 2025.

The effective tax rate for fiscal 2025 year-to-date was a benefit rate of 24.1 % on pre-tax loss compared to a benefit rate of 20.9 % on pre-tax loss for fiscal 2024 year-to-date.

The change from fiscal 2024 year-to-date is primarily driven by a reduction in pre-tax loss for fiscal 2025 year-to-date and a decrease in discrete tax expenses resulting from share award vestings through the second quarter of fiscal 2025.

NOTE 12—LOSS PER SHARE

The following is a reconciliation of the basic and diluted number of shares used in computing loss per share:

13-Week Period Ended

(in millions, except per share data) November 2,

2024 October 28,

13-Week Period Ended 26-Week Period Ended

(in millions, except per share data) February 1,

2025 January 27,

2024 February 1,

2025 January 27,

Basic weighted average shares outstanding 60.2 59.4 59.9 59.0

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Anti-dilutive share-based awards excluded from the calculation of diluted loss per share

1.8 2.2 2.1 2.0

(1) Loss per share amounts are calculated using actual unrounded figures.

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These reportable segments are two distinct businesses, each with a different customer base, marketing strategy and management structure.

The Company organizes and operates the Wholesale reportable segment through three U.S geographic regions:

The Company organizes and operates the Wholesale reportable segment through three U.S.

geographic regions:

East, Central and West, and Canada Wholesale, which is operated separately from the U.S.

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The following table provides information by reportable segment, including Net sales, Adjusted EBITDA, with a reconciliation to Loss before income taxes, depreciation and amortization, and payments for capital expenditures:

13-Week Period Ended

(in millions) November 2, 2024 October 28, 2023

13-Week Period Ended 26-Week Period Ended

(in millions) February 1, 2025 January 27, 2024 February 1, 2025 January 27, 2024

Wholesale (1)

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Retail 610 631 1,196 1,237

Other 53 52 111 112

Eliminations ( 377 ) ( 395 ) ( 740 ) ( 790 )

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Retail 6 8 6 7

Other 5 4 6 7

Eliminations ( 2 ) ( 2 ) — ( 4 )

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Wholesale $ 69 $ 66 $ 139 $ 133

Retail 9 8 18 16

Other 3 — 4 3

Total depreciation and amortization $ 81 $ 74 $ 161 $ 152

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Wholesale $ 51 $ 64 $ 98 $ 135

Retail 3 3 5 6

Total capital expenditures $ 54 $ 67 $ 103 $ 141

(1) As presented in Note 3—Revenue Recognition, the Company recorded $ 301 million and $ 321 million for the first quarters of fiscal 2025 and 2024, respectively, within Net sales in its Wholesale reportable segment attributable to Wholesale to Retail sales that have been eliminated upon consolidation.

(1) The Company recorded $ 320 million and $ 330 million for the second quarters of fiscal 2025 and 2024, respectively, and $ 621 million and $ 651 million in fiscal 2025 and 2024 year-to-date, respectively, within Net sales in its Wholesale reportable segment attributable to Wholesale to Retail sales that have been eliminated upon consolidation.

Total assets by reportable segment were as follows:

(in millions) November 2, 2024 August 3, 2024

(in millions) February 1, 2025 August 3, 2024

Wholesale $ 6,764 $ 6,563

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Guarantees and Contingent Liabilities

The Company has outstanding guarantees related to certain leases, fixture financing loans and other debt obligations of various retailers as of November 2, 2024.

The Company has outstanding guarantees related to certain leases, fixture financing loans and other debt obligations of various retailers as of February 1, 2025.

These guarantees were generally made to support the business growth of wholesale customers.

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The Company reviews performance risk related to its guarantee obligations based on internal measures of credit performance.

As of November 2, 2024, the maximum amount of undiscounted payments the Company would be required to make in the event of default of all guarantees was $ 11 million ($ 9 million on a discounted basis).

Based on the indemnification agreements, personal guarantees and results of the reviews of performance risk, as of November 2, 2024, a total estimated loss of less than $ 1 million is recorded in the Condensed Consolidated Balance Sheets.

As of February 1, 2025, the maximum amount of undiscounted payments the Company would be required to make in the event of default of all guarantees was $ 10 million ($ 9 million on a discounted basis).

Based on the indemnification agreements, personal guarantees and results of the reviews of performance risk, as of February 1, 2025, the Company has recorded a de minimis total estimated loss in the Condensed Consolidated Balance Sheets.

The Company is a party to a variety of contractual agreements under which it may be obligated to indemnify the other party for certain matters in the ordinary course of business, which indemnities may be secured by operation of law or otherwise.

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These contracts typically include either volume commitments or fixed expiration dates, termination provisions and other standard contractual considerations.

As of November 2, 2024, the Company had approximately $ 512 million of non-cancelable future purchase obligations, most of which will be paid and utilized in the ordinary course within one year.

As of November 2, 2024, the Company had commitments of $ 49 million for future undiscounted minimum lease payments on leases signed but not yet commenced with terms of up to 21 years from commencement date.

As of February 1, 2025, the Company had approximately $ 419 million of non-cancelable future purchase obligations, most of which will be paid and utilized in the ordinary course within one year.

As of February 1, 2025, commitments for future undiscounted minimum lease payments on leases signed but not yet commenced were not material.

A lease agreement for a distribution center in Sarasota, Florida commenced in the first quarter of fiscal 2025 resulting in the recognition of a $ 118 million right-of-use asset and operating lease liability in the Condensed Consolidated Balance Sheets.

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On May 20, 2024, the District Court heard oral argument on the pending motions for summary judgment and on September 30, 2024, the Court denied both parties’ motions for summary judgment on scienter and granted relators’ motion for summary judgment on materiality.

The trial is now scheduled to begin February 10, 2025.

On March 4, 2025, after a three-week jury trial, the jury found in favor of the Company determining that the Company has no liability.

Once the Court enters judgment, the relators have twenty-eight days to file post-trial motions or thirty days to appeal.

The Company, J.

16 unchanged sentences

Management regularly monitors the Company’s exposure to the loss contingencies associated with these matters and may from time to time change its predictions with respect to outcomes and estimates with respect to related costs and exposures.

As of November 2, 2024, no material accrued obligations, individually or in the aggregate, have been recorded for these legal proceedings.

Management has made provisions where it believes the loss contingency is probable and can be reasonably estimated.

As of February 1, 2025, no material accrued obligations, individually or in the aggregate, have been recorded for these legal proceedings.

Although management believes it has made appropriate assessments of potential and contingent loss in each of these cases based on current facts and circumstances, and application of prevailing legal principles, there can be no assurance that material differences in actual outcomes from management’s current assessments, costs and exposures relative to current predictions and estimates, or material changes in such predictions or estimates will not occur.

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 1. Financial Statements