V F CORP 10-Q

ITEM 1 — FINANCIAL STATEMENTS (UNAUDITED). VF CORPORATION Consolidated Balance Sheets (Unaudited) (In thousands, except share amounts) June 2025 March 2025 June 2024 ASSETS Current assets Cash and cash equivalents $ 642,386 $ 429,382 $ 625,436 Accounts receivable, less allowance for doubtful accounts of: June 2025 - $ 35,803 ; March 2025 - $ 31,853 ; June 2024 - $ 28,542 1,172,223 1,321,663 1,049,368 Inventories 2,135,478 1,627,025 2,059,728 Other current assets 425,429 408,028 519,675 Current assets of discontinued operations — — 94,924 Total current assets 4,375,516 3,786,098 4,349,131 Property, plant and equipment, net 720,785 720,879 759,811 Intangible assets, net 1,723,749 1,710,707 1,770,765 Goodwill 620,829 603,386 643,220 Operating lease right-of-use assets 1,319,142 1,262,319 1,260,903 Other assets 1,390,476 1,294,147 1,194,425 Other assets of discontinued operations — — 1,563,108 TOTAL ASSETS $ 10,150,497 $ 9,377,536 $ 11,541,363 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities Short-term borrowings $ 392,915 $ 11,916 $ 263,709 Current portion of long-term debt 586,005 540,579 1,749,601 Accounts payable 1,166,757 789,570 1,136,236 Accrued liabilities 1,293,962 1,355,788 1,196,504 Current liabilities of discontinued operations — — 62,924 Total current liabilities 3,439,639 2,697,853 4,408,974 Long-term debt 3,560,990 3,425,650 3,940,668 Operating lease liabilities 1,135,094 1,079,182 1,100,183 Other liabilities 722,491 687,492 633,984 Other liabilities of discontinued operations — — 69,649 Total liabilities 8,858,214 7,890,177 10,153,458 Commitments and contingencies Stockholders’ equity Preferred Stock, par value $ 1 ; shares authorized, 25,000,000 ; no shares outstanding at June 2025, March 2025 or June 2024 — — — Common Stock, stated value $ 0.25 ; shares authorized, 1,200,000,000 ; shares outstanding at June 2025 - 390,555,382 ; March 2025 - 389,695,199 ; June 2024 - 389,181,642 97,639 97,424 97,295 Additional paid-in capital 3,527,375 3,540,686 3,580,175 Accumulated other comprehensive loss ( 1,037,424 ) ( 977,740 ) ( 1,053,627 ) Accumulated deficit ( 1,295,307 ) ( 1,173,011 ) ( 1,235,938 ) Total stockholders’ equity 1,292,283 1,487,359 1,387,905 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 10,150,497 $ 9,377,536 $ 11,541,363 See notes to consolidated financial statements. 3 VF Corporation Q1 FY26 Form 10-Q Table of Contents VF CORPORATION Consolidated Statements of Operations (Unaudited) Three Months Ended June (In thousands, except per share amounts) 2025 2024 Revenues $ 1,760,666 $ 1,769,060 Costs and operating expenses Cost of goods sold 811,664 863,382 Selling, general and administrative expenses 1,035,611 1,028,698 Total costs and operating expenses 1,847,275 1,892,080 Operating loss ( 86,609 ) ( 123,020 ) Interest income 2,518 3,395 Interest expense ( 43,638 ) ( 44,342 ) Other income (expense), net 1,136 ( 1,486 ) Loss from continuing operations before income taxes ( 126,593 ) ( 165,453 ) Income tax benefit ( 10,185 ) ( 13,426 ) Loss from continuing operations ( 116,408 ) ( 152,027 ) Loss from discontinued operations, net of tax — ( 106,859 ) Net loss $ ( 116,408 ) $ ( 258,886 ) Net loss per common share - basic Continuing operations $ ( 0.30 ) $ ( 0.39 ) Discontinued operations — ( 0.27 ) Total net loss per common share - basic $ ( 0.30 ) $ ( 0.67 ) Net loss per common share - diluted Continuing operations $ ( 0.30 ) $ ( 0.39 ) Discontinued operations — ( 0.27 ) Total net loss per common share - diluted $ ( 0.30 ) $ ( 0.67 ) Weighted average shares outstanding Basic 390,024 388,741 Diluted 390,024 388,741 See notes to consolidated financial statements. VF Corporation Q1 FY26 Form 10-Q 4 Table of Contents VF CORPORATION Consolidated Statements of Comprehensive Loss (Unaudited) Three Months Ended June (In thousands) 2025 2024 Net loss $ ( 116,408 ) $ ( 258,886 ) Other comprehensive income (loss) Foreign currency translation and other Gains (losses) arising during the period 11,969 ( 15,773 ) Income tax effect 45,593 ( 3,680 ) Defined benefit pension plans Amortization of net deferred actuarial losses 4,871 5,046 Amortization of deferred prior service credits ( 153 ) ( 144 ) Reclassification of deferred prior service cost due to curtailments ( 531 ) — Income tax effect ( 1,050 ) ( 1,270 ) Derivative financial instruments Gains (losses) arising during the period ( 131,290 ) 20,021 Income tax effect 21,978 ( 4,236 ) Reclassification of net (gains) losses realized ( 13,305 ) 13,729 Income tax effect 2,234 ( 2,989 ) Other comprehensive income (loss) ( 59,684 ) 10,704 Comprehensive loss $ ( 176,092 ) $ ( 248,182 ) See notes to consolidated financial statements. 5 VF Corporation Q1 FY26 Form 10-Q Table of Contents VF CORPORATION Consolidated Statements of Cash Flows (Unaudited) Three Months Ended June (In thousands) 2025 2024 OPERATING ACTIVITIES Net loss $ ( 116,408 ) $ ( 258,886 ) Loss from discontinued operations, net of tax — ( 106,859 ) Loss from continuing operations, net of tax ( 116,408 ) ( 152,027 ) Adjustments to reconcile net loss to cash provided (used) by operating activities: Depreciation and amortization 64,362 64,625 Reduction in the carrying amount of right-of-use assets 85,219 88,500 Stock-based compensation 20,684 13,109 Provision for doubtful accounts 3,327 4,424 Pension expense in excess of (less than) contributions ( 5,730 ) 2,219 Other, net 8,908 ( 13,896 ) Changes in operating assets and liabilities: Accounts receivable 200,423 198,985 Inventories ( 450,750 ) ( 373,358 ) Accounts payable 347,962 352,549 Income taxes ( 51,303 ) ( 79,723 ) Accrued liabilities ( 110,210 ) ( 61,767 ) Operating lease right-of-use assets and liabilities ( 86,168 ) ( 83,778 ) Other assets and liabilities ( 55,776 ) 9,424 Cash used by operating activities - continuing operations ( 145,460 ) ( 30,714 ) Cash provided by operating activities - discontinued operations — 50,544 Cash provided (used) by operating activities ( 145,460 ) 19,830 INVESTING ACTIVITIES Proceeds from sale of assets 605 45,596 Capital expenditures ( 28,246 ) ( 23,763 ) Software purchases ( 17,148 ) ( 15,504 ) Other, net ( 4,224 ) ( 15,364 ) Cash used by investing activities - continuing operations ( 49,013 ) ( 9,035 ) Cash used by investing activities - discontinued operations — ( 2,026 ) Cash used by investing activities ( 49,013 ) ( 11,061 ) FINANCING ACTIVITIES Net increase (decrease) in short-term borrowings 380,446 ( 230 ) Payments on long-term debt ( 282 ) ( 275 ) Payment of debt issuance costs ( 1,540 ) — Cash dividends paid ( 35,150 ) ( 35,015 ) Proceeds from issuance of Common Stock, net of payments for tax withholdings ( 4,519 ) ( 1,924 ) Cash provided (used) by financing activities 338,955 ( 37,444 ) Effect of foreign currency rate changes on cash, cash equivalents and restricted cash 72,377 ( 8,340 ) Net change in cash, cash equivalents and restricted cash 216,859 ( 37,015 ) Cash, cash equivalents and restricted cash – beginning of year 431,475 676,957 Cash, cash equivalents and restricted cash – end of period $ 648,334 $ 639,942 Continued on next page. See notes to consolidated financial statements. VF Corporation Q1 FY26 Form 10-Q 6 Table of Contents VF CORPORATION Consolidated Statements of Cash Flows (Unaudited) Three Months Ended June (In thousands) 2025 2024 Balances per Consolidated Balance Sheets: Cash and cash equivalents $ 642,386 $ 625,436 Other current assets 5,871 2,397 Current and other assets of discontinued operations 77 12,107 Other assets — 2 Total cash, cash equivalents and restricted cash $ 648,334 $ 639,942 See notes to consolidated financial statements. 7 VF Corporation Q1 FY26 Form 10-Q Table of Contents VF CORPORATION Consolidated Statements of Stockholders’ Equity (Unaudited) Three Months Ended June 2025 Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Common Stock (In thousands, except share amounts) Shares Amounts Total Balance, March 2025 389,695,199 $ 97,424 $ 3,540,686 $ ( 977,740 ) $ ( 1,173,011 ) $ 1,487,359 Net loss — — — — ( 116,408 ) ( 116,408 ) Dividends on Common Stock ($ 0.09 per share) — — ( 35,150 ) — — ( 35,150 ) Stock-based compensation, net 860,183 215 21,839 — ( 5,888 ) 16,166 Foreign currency translation and other — — — 57,562 — 57,562 Defined benefit pension plans — — — 3,137 — 3,137 Derivative financial instruments — — — ( 120,383 ) — ( 120,383 ) Balance, June 2025 390,555,382 $ 97,639 $ 3,527,375 $ ( 1,037,424 ) $ ( 1,295,307 ) $ 1,292,283 Three Months Ended June 2024 Additional Paid-in Capital Accumulated Other Comprehensive Loss Accumulated Deficit Common Stock (In thousands, except share amounts) Shares Amounts Total Balance, March 2024 388,836,219 $ 97,209 $ 3,600,071 $ ( 1,064,331 ) $ ( 974,584 ) $ 1,658,365 Net loss — — — — ( 258,886 ) ( 258,886 ) Dividends on Common Stock ($ 0.09 per share) — — ( 35,015 ) — — ( 35,015 ) Stock-based compensation, net 345,423 86 15,119 — ( 2,468 ) 12,737 Foreign currency translation and other — — — ( 19,453 ) — ( 19,453 ) Defined benefit pension plans — — — 3,632 — 3,632 Derivative financial instruments — — — 26,525 — 26,525 Balance, June 2024 389,181,642 $ 97,295 $ 3,580,175 $ ( 1,053,627 ) $ ( 1,235,938 ) $ 1,387,905 See notes to consolidated financial statements. VF Corporation Q1 FY26 Form 10-Q 8 Table of Contents VF CORPORATION Notes to Consolidated Financial Statements (Unaudited) NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS PAGE NUMBER NOTE 1 Basis of Presentation 10 NOTE 2 Recently Issued Accounting Standards 10 NOTE 3 Revenues 11 NOTE 4 Discontinued Operations 12 NOTE 5 Inventories 13 NOTE 6 Intangible Assets 14 NOTE 7 Goodwill 14 NOTE 8 Leases 14 NOTE 9 Supply Chain Financing Program 15 NOTE 10 Pension Plans 15 NOTE 11 Capital and Accumulated Other Comprehensive Loss 15 NOTE 12 Stock-based Compensation 17 NOTE 13 Income Taxes 17 NOTE 14 Reportable Segment Information 18 NOTE 15 Net Loss Per Share 20 NOTE 16 Fair Value Measurements 21 NOTE 17 Derivative Financial Instruments and Hedging Activities 22 NOTE 18 Restructuring 24 NOTE 19 Subsequent Event 25 9 VF Corporation Q1 FY26 Form 10-Q Table of Contents NOTE 1 — BASIS OF PRESENTATION Fiscal Year VF Corporation (together with its subsidiaries, collectively known as “VF” or the “Company”) uses a 52/53 week fiscal year ending on the Saturday closest to March 31 of each year. The Company's current fiscal year runs from March 30, 2025 through March 28, 2026 (“Fiscal 2026”). Accordingly, this Form 10-Q presents our first quarter of Fiscal 2026. For presentation purposes herein, all references to periods ended June 2025 and June 2024 relate to the fiscal periods ended on June 28, 2025 and June 29, 2024, respectively. References to March 2025 relate to information as of March 29, 2025. Basis of Presentation In the first quarter of Fiscal 2026, VF realigned its reportable segments to reflect a change in how the Timberland ® brand is managed and the chief operating decision maker's ("CODM") key areas of focus. VF began managing its Timberland ® and Timberland PRO ® brands as one operating segment during the first quarter of Fiscal 2026. This operating segment has been aggregated with The North Face ® brand in the Outdoor reportable segment and the Vans ® , Kipling ® , Eastpak ® and Jansport ® brands have been aggregated in the Active reportable segment. All other brands that have not been aggregated within the reportable segments described above, which do not meet the quantitative threshold to be disclosed as a separate reportable segment, have been grouped within an "All Other" category. This group includes the Dickies ® , Altra ® , Smartwool ® , Napapijri ® and Icebreaker ® brands. Reportable segment results for all prior periods presented within these notes to the interim consolidated financial statements have been recast to reflect the change in reportable segments. These changes had no impact on previously reported consolidated results of operations. Refer to Note 14 for additional information on VF's reportable segments. On July 16, 2024, VF entered into a definitive Stock and Asset Purchase Agreement (the "Purchase Agreement") with EssilorLuxottica S.A. to sell the Supreme ® brand business ("Supreme"). On October 1, 2024, VF completed the sale of Supreme. During the second quarter of Fiscal 2025, the Company determined that Supreme met the held-for-sale and discontinued operations accounting criteria. Accordingly, VF has reported the results of Supreme and the related cash flows as discontinued operations in the Consolidated Statements of Operations and Consolidated Statements of Cash Flows, respectively, through the date of sale. The related held-for-sale assets and liabilities have been reported as assets and liabilities of discontinued operations in the Consolidated Balance Sheets, through the date of sale. These changes have been applied to all periods presented. Unless otherwise noted, discussion within these notes to the interim consolidated financial statements relates to continuing operations. Refer to Note 4 for additional information on discontinued operations. Certain prior year amounts have been reclassified to conform to the Fiscal 2026 presentation. The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X and do not include all of the information and notes required by generally accepted accounting principles in the United States of America (“GAAP”) for complete financial statements. Similarly, the March 2025 consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by GAAP. In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all normal and recurring adjustments necessary to fairly state the consolidated financial position, results of operations and cash flows of VF for the interim periods presented. Operating results for the three months ended June 2025 are not necessarily indicative of results that may be expected for any other interim period or for Fiscal 2026. For further information, refer to the consolidated financial statements and notes included in VF’s Annual Report on Form 10-K for the year ended March 29, 2025 (“Fiscal 2025 Form 10-K”). Use of Estimates In preparing the interim consolidated financial statements, management makes estimates and assumptions that affect amounts reported in the interim consolidated financial statements and accompanying notes. Actual results may differ from those estimates due to risks and uncertainties, including the impact of the recently imposed reciprocal tariffs on foreign imports by the U.S. government. The high level of uncertainty regarding these tariffs may result in estimates and assumptions that have the potential for more variability and are more subjective, including those applied in the Company's forecasted results of operations and cash flows, which are used in the determination of fair value for goodwill and indefinite-lived intangible asset impairment testing. While estimates and assumptions made by management are based upon currently available information, actual results could materially differ given the uncertainty of these factors and may require future changes to such estimates and assumptions. NOTE 2 — RECENTLY ISSUED ACCOUNTING STANDARDS In December 2023, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2023-09, " Income Taxes (Topic 740): Improvements to Income Tax Disclosures" , which is intended to enhance the transparency and decision usefulness of income tax disclosures by requiring that an entity, on an annual basis, disclose additional income tax information, primarily related to the rate reconciliation and income taxes paid. The rate reconciliation disclosures will require specific categories and additional information for reconciling items that meet a quantitative threshold. The income taxes paid disclosures will require disaggregation by individual jurisdictions that are greater than 5% of total income taxes paid. The guidance will be effective for annual disclosures beginning in Fiscal 2026. Early adoption is permitted. The amendments are required to be applied on a prospective basis; however, retrospective application is permitted. The Company is evaluating the impact that adopting this guidance will have on VF's disclosures. VF Corporation Q1 FY26 Form 10-Q 10 Table of Contents In November 2024, the FASB issued ASU No. 2024-03, " Income Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses" , which is intended to enhance expense disclosures by requiring additional disaggregation of certain costs and expenses, on an interim and annual basis, within the footnotes to the financial statements. The guidance will be effective for annual disclosures beginning in Fiscal 2028 and subsequent interim periods. Early adoption is permitted and the amendments may be applied either prospectively or retrospectively. The Company is evaluating the impact that adopting this guidance will have on VF's disclosures. NOTE 3 — REVENUES Contract Balances The following table provides information about contract assets and contract liabilities: (In thousands) June 2025 March 2025 June 2024 Contract assets (a) $ 6,365 $ 2,448 $ 3,188 Contract liabilities (b) 76,164 78,421 67,954 (a) Included in the other current assets line item in the Consolidated Balance Sheets. (b) Included in the accrued liabilities line item in the Consolidated Balance Sheets. For the three months ended June 2025, the Company recognized $ 53.3 million of revenue that was included in the contract liability balance during the period, including amounts recorded as a contract liability and subsequently recognized as revenue as performance obligations were satisfied within the same period, such as order deposits from customers. The change in the contract asset and contract liability balances primarily results from timing differences between the Company's satisfaction of performance obligations and the customer's payment. Performance Obligations As of June 2025, the Company expects to recognize $ 62.0 million of fixed consideration related to the future minimum guarantees in effect under its licensing agreements and expects such amounts to be recognized over time based on the contractual terms through March 2031. The variable consideration related to licensing arrangements is not disclosed as a remaining performance obligation as it qualifies for the sales-based royalty exemption. VF has also elected the practical expedient to not disclose the transaction price allocated to remaining performance obligations for contracts with an original expected duration of one year or less. As of June 2025, there were no arrang ements with transaction price allocated to remaining performance obligations other than contracts for which the Company has applied the practical expedients and the fixed consideration related to future minimum guarantees discussed above. Disaggregation of Revenues The following tables disaggregate our revenues by channel and geography, which provides a meaningful depiction of how the nature, timing and uncertainty of revenues are affected by economic factors. Three Months Ended June 2025 (a) (In thousands) Outdoor Active All Other (b) Total Channel revenues Wholesale $ 456,831 $ 392,423 $ 175,252 $ 1,024,506 Direct-to-consumer 352,210 301,029 67,424 720,663 Royalty 3,425 6,235 5,837 15,497 Total $ 812,466 $ 699,687 $ 248,513 $ 1,760,666 Geographic revenues Americas $ 372,847 $ 404,035 $ 160,716 $ 937,598 Europe 272,844 213,507 64,912 551,263 Asia-Pacific 166,775 82,145 22,885 271,805 Total $ 812,466 $ 699,687 $ 248,513 $ 1,760,666 11 VF Corporation Q1 FY26 Form 10-Q Table of Contents Three Months Ended June 2024 (a) (In thousands) Outdoor Active All Other (b) Total Channel revenues Wholesale $ 427,005 $ 418,061 $ 168,708 $ 1,013,774 Direct-to-consumer 323,487 351,755 65,713 740,955 Royalty 3,138 6,918 4,275 14,331 Total $ 753,630 $ 776,734 $ 238,696 $ 1,769,060 Geographic revenues Americas $ 363,680 $ 457,656 $ 154,363 $ 975,699 Europe 244,962 222,469 64,905 532,336 Asia-Pacific 144,988 96,609 19,428 261,025 Total $ 753,630 $ 776,734 $ 238,696 $ 1,769,060 (a) In the three months ended June 2025, VF realigned its reportable segments. The three months ended June 2024 have been recast to reflect this change. Refer to Note 14 for additional information regarding the Company's reportable segments. (b) "All Other" is included for purposes of reconciliation of revenues, but it is not considered a reportable segment. "All Other" includes the Dickies ® , Altra ® , Smartwool ® , Napapijri ® and Icebreaker ® brands. NOTE 4 — DISCONTINUED OPERATIONS The Company continuously assesses the composition of its portfolio to ensure it is aligned with its strategic objectives and positioned to maximize growth and return to shareholders. Supreme On July 16, 2024, VF entered into a Purchase Agreement with EssilorLuxottica S.A. to sell Supreme for an aggregate base purchase price of $ 1.500 billion, subject to customary adjustments for cash, indebtedness, working capital and transaction expenses as more fully set forth in the Purchase Agreement. On October 1, 2024, VF completed the sale of Supreme. VF received proceeds of $ 1.506 billion, net of cash sold, resulting in a final after-tax loss on sale of $ 126.6 million. VF used a portion of the net cash proceeds to prepay $ 1.0 billion of its delayed draw Term Loan ("DDTL") pursuant to the terms of the DDTL Agreement, as amended, which required repayment within ten business days of VF’s receipt of the net cash proceeds from the sale of Supreme, and to repay $ 450.0 million of commercial paper borrowings upon maturity during the third quarter of Fiscal 2025. During the second quarter of Fiscal 2025, the Company determined that Supreme met the held-for-sale and discontinued operations accounting criteria. Accordingly, the Company has reported the results of Supreme and the related cash flows as discontinued operations in the Consolidated Statements of Operations and Consolidated Statements of Cash Flows, respectively, through the date of sale. The related held-for-sale assets and liabilities have been reported as assets and liabilities of discontinued operations in the Consolidated Balance Sheets, through the date of sale. These changes have been applied to all periods presented. The results of Supreme were previously reported in the Active segment. The results of Supreme recorded in the loss from discontinued operations, net of tax line item in the Consolidated Statement of Operations were a loss of $ 106.9 million (including goodwill and intangible asset impairment charges of $ 145.0 million) for the three months ended June 2024 . During the first quarter of Fiscal 2025, VF determined that a triggering event had occurred requiring impairment testing of the Supreme reporting unit goodwill and indefinite-lived trademark intangible asset. As a result of the impairment testing performed, VF recorded impairment charges of $ 94.0 million and $ 51.0 million to the Supreme reporting unit goodwill and indefinite-lived trademark intangible asset, respectively. Under the terms of a transition services agreement, the Company will provide certain post-closing accounting, tax, treasury, digital technology, supply chain and human resource services on a transitional basis for periods generally up to 12 months from the closing date of the transaction. Certain corporate overhead costs and segment costs previously allocated to the Supreme brand for segment reporting purposes did not qualify for classification within discontinued operations and have been allocated to continuing operations. In addition, interest expense and the related interest rate swap impact for the DDTL were allocated to discontinued operations due to the requirement within the DDTL Agreement, as amended, that the DDTL be prepaid upon the receipt of the net cash proceeds from the sale of Supreme. VF Corporation Q1 FY26 Form 10-Q 12 Table of Contents Summarized Discontinued Operations Financial Information The following table summarizes the major line items for Supreme that are included in the loss from discontinued operations, net of tax line item in the Consolidated Statements of Operations: Three Months Ended June (In thousands) 2025 (a) 2024 Revenues $ — $ 138,241 Cost of goods sold — 52,261 Selling, general and administrative expenses — 57,853 Impairment of goodwill and intangible assets — 145,000 Interest expense, net (b) — ( 14,730 ) Other income (expense), net — ( 464 ) Loss from discontinued operations before income taxes — ( 132,067 ) Income tax benefit — ( 25,208 ) Loss from discontinued operations, net of tax $ — $ ( 106,859 ) (a) There was no activity during the three months ended June 2025 . (b) As noted above, interest expense and the related interest rate swap im pact for the DDTL were alloc ated to discontinued operations. The following table summarizes the carrying amounts of major classes of assets and liabilities of discontinued operations as of June 2024 . (In thousands) June 2024 Cash and cash equivalents $ 11,984 Accounts receivable, net 6,203 Inventories 50,870 Other current assets 25,867 Property, plant and equipment, net 34,401 Intangible assets, net 801,000 Goodwill 717,562 Operating lease right-of-use assets 72,047 Other assets 18,790 Deferred income tax assets (a) ( 80,692 ) Total assets of discontinued operations $ 1,658,032 Accounts payable $ 21,519 Accrued liabilities 41,405 Operating lease liabilities 67,232 Other liabilities 2,417 Total liabilities of discontinued operations $ 132,573 (a) Deferred income tax balances reflect VF’s consolidated netting by jurisdiction. NOTE 5 — INVENTORIES (In thousands) June 2025 March 2025 June 2024 Finished products $ 2,095,573 $ 1,588,124 $ 2,022,731 Work-in-process 39,794 38,808 36,881 Raw materials 111 93 116 Total inventories $ 2,135,478 $ 1,627,025 $ 2,059,728 13 VF Corporation Q1 FY26 Form 10-Q Table of Contents NOTE 6 — INTANGIBLE ASSETS June 2025 March 2025 (In thousands) Weighted Average Amortization Period Amortization Method Cost Accumulated Amortization Net Carrying Amount Net Carrying Amount Amortizable intangible assets: Customer relationships and other 19 years Accelerated $ 271,220 $ 210,994 $ 60,226 $ 61,822 Indefinite-lived intangible assets: Trademarks and trade names 1,663,523 1,648,885 Intangible assets, net $ 1,723,749 $ 1,710,707 Amortization expense for the three months ended June 2025 was $ 3.2 million. Based on the carrying amounts of amortizable intangible assets noted above, estimated amortization expense for the next five years beginning in Fiscal 2026 is $ 12.5 million, $ 12.0 million, $ 11.0 million, $ 10.0 million and $ 8.0 million, respectively. NOTE 7 — GOODWILL Changes in goodwill are summarized by reportable segment and the "All Other" category as follows: (In thousands) Outdoor Active All Other (a) Total Balance, March 2025 $ 102,146 $ 328,449 $ 172,791 $ 603,386 Foreign currency translation 82 12,514 4,847 17,443 Balance, June 2025 $ 102,228 $ 340,963 $ 177,638 $ 620,829 (a) "All Other" is included for purposes of reconciliation of goodwill, but it is not considered a reportable segment. "All Other" includes the Dickies ® , Altra ® , Smartwool ® , Napapijri ® and Icebreaker ® brands. In connection with the realignment of the Company's segment reporting structure, the Company allocated goodwill related to Timberland PRO to the Timberland reporting unit as of the first day of the first quarter of Fiscal 2026. As a result of the change in reportable segments, the Company performed impairment assessments both before and after the segment change became effective, and no impairment of goodwill was identified. Balances as of March 2025 have been retrospectively adjusted to reflect the reallocation. Refer to Note 14 for additional information regarding the Company's reportable segments. Accum ulated impairm ent charges for the Outdoor reportable segment and the "All Other" category were $ 730.2 million and $ 138.8 million, respectively, a s of June 2025 and March 2025 . No impai rment charges were recorded during the three months ended June 2025 . NOTE 8 — LEASES The Company leases certain retail locations, office space, distribution facilities, machinery and equipment, and vehicles. The substantial majority of these leases are operating leases. Total lease cost includes operating lease cost, variable lease cost, finance lease cost, short-term lease co st a nd gain recognized from a sale leaseback transaction. The components of lease cost were as follows: Three Months Ended June (In thousands) 2025 2024 Operating lease cost $ 98,428 $ 100,611 Other lease cost 34,913 22,247 Total lease cost $ 133,341 $ 122,858 During the three months ended June 2024, the Company entered int o a sale leaseback transaction for certain warehouse real estate and related assets. The transaction qualified as a sale, and thus the Company reco gnized a ga in of $ 15.5 million in the selling, general and administrative ("SG&A") expenses line item in VF's Consolidated Statement of Operations for the three months ended June 2024. During the three months ended June 2025 and 2024, the Company paid $ 100.0 million and $ 99.8 million for operating leases, respectively. During the three months ended June 2025 and 2024, the Company obtained $ 104.6 million and $ 100.9 million of right-of-use assets in exchange for lease liabilities, respectively. VF Corporation Q1 FY26 Form 10-Q 14 Table of Contents NOTE 9 — SUPPLY CHAIN FINANCING PROGRAM VF facilitates a voluntary supply chain finance ("SCF") program that enables a significant portion of our inventory suppliers to leverage VF's credit rating to receive payment from participating financial institutions prior to the payment date specified in the terms between VF and the supplier. At June 2025, March 2025 and June 2024, the accounts payable line item in VF’s Consolidated Balance Sheets included total outstanding obligatio ns of $ 887.1 million, $ 481.7 million and $ 843.0 million, respectively, due to suppliers that are eligible to participate in the SCF program. NOTE 10 — PENSION PLANS The components of pension cost for VF’s defined benefit plans were as follows: Three Months Ended June (In thousands) 2025 2024 Service cost – benefits earned during the period $ 2,513 $ 2,408 Interest cost on projected benefit obligations 11,147 11,680 Expected return on plan assets ( 15,007 ) ( 15,296 ) Curtailments ( 531 ) — Amortization of deferred amounts: Net deferred actuarial losses 4,871 5,046 Deferred prior service credits ( 153 ) ( 144 ) Net periodic pension cost $ 2,840 $ 3,694 VF has reported the service cost component of net periodic pension cost i n operating loss an d the other components, which include interest cost, expected return on plan assets, curtailments and amortization of deferred actuarial losses and prior service credits, in the other income (expense), net line item in the Consolidated Statements of Operations. VF contributed $ 8.6 million to its defined benefit plans during the three months ended June 2025, and intends to make approximately $ 7.5 million of contributions during the remainder of Fiscal 2026. VF recorded $ 0.5 million in curtailment gains in the other income (expense), net line item in the Consolidated Statement of Operations for the three months ended June 2025, related to employee exits from an international plan resulting from restructuring actions. In May 2025 VF executed a resolution to terminate the U.S. qualified plan, which is frozen and no longer accrues benefits. As of June 2025, the fair value of the plan's assets exceeded its benefit obligation. The termination of the plan will be effective July 31, 2025, is subject to the appropriate regulatory approvals, and is expected to be completed in Fiscal 2026. VF's settlement obligations and related charges will depend upon both the nature and timing of participant settlements and prevailing market conditions. VF currently estimates non-cash settlement charges to be between $ 200.0 and $ 300.0 million. NOTE 11 — CAPITAL AND ACCUMULATED OTHER COMPREHENSIVE LOSS Common Stock During the three months ended June 2025, the Company did no t purchase shares of Common Stock in open market transactions under its share repurchase program authorized by VF’s Board of Directors. These are treated as treasury stock transactions when shares are repurchased. Common Stock outstanding is net of shares held in treasury which are, in substance, retired. There were no shares held in treasury at the end of June 2025, March 2025 or June 2024. The excess of the cost of treasury shares acquired over the $ 0.25 per share stated value of Common Stock is deducted from retained earnings (accumulated deficit). 15 VF Corporation Q1 FY26 Form 10-Q Table of Contents Accumulated Other Comprehensive Loss Comprehensive loss consists of net loss and specified components of other comprehensive income (loss) , which relate to changes in assets and liabilities that are not included in net loss under GAAP but are instead deferred and accumulated within a separate component of stockholders’ equity in the balance sheet. VF’s comprehensive loss is presented in the Consolidated Statements of Comprehensive Loss. The deferred components o f other comprehensive income (loss) are reported, net of related income taxes, in accu mulated other comprehensive loss ("OC L") in stockholders’ equity, as follows: (In thousands) June 2025 March 2025 June 2024 Foreign currency translation and other $ ( 763,627 ) $ ( 821,189 ) $ ( 887,892 ) Defined benefit pension plans ( 176,910 ) ( 180,047 ) ( 178,701 ) Derivative financial instruments ( 96,887 ) 23,496 12,966 Accumulated other comprehensive loss $ ( 1,037,424 ) $ ( 977,740 ) $ ( 1,053,627 ) The changes in accumulated OCL, ne t of related taxes, were as follows: Three Months Ended June 2025 (In thousands) Foreign Currency Translation and Other Defined Benefit Pension Plans Derivative Financial Instruments Total Balance, March 2025 $ ( 821,189 ) $ ( 180,047 ) $ 23,496 $ ( 977,740 ) Other comprehensive income (loss) before reclassifications 57,562 10 ( 109,312 ) ( 51,740 ) Amounts reclassified from accumulated other comprehensive loss — 3,127 ( 11,071 ) ( 7,944 ) Net other comprehensive income (loss) 57,562 3,137 ( 120,383 ) ( 59,684 ) Balance, June 2025 $ ( 763,627 ) $ ( 176,910 ) $ ( 96,887 ) $ ( 1,037,424 ) Three Months Ended June 2024 (In thousands) Foreign Currency Translation and Other Defined Benefit Pension Plans Derivative Financial Instruments Total Balance, March 2024 $ ( 868,439 ) $ ( 182,333 ) $ ( 13,559 ) $ ( 1,064,331 ) Other comprehensive income (loss) before reclassifications ( 19,453 ) ( 10 ) 15,785 ( 3,678 ) Amounts reclassified from accumulated other comprehensive loss — 3,642 10,740 14,382 Net other comprehensive income (loss) ( 19,453 ) 3,632 26,525 10,704 Balance, June 2024 $ ( 887,892 ) $ ( 178,701 ) $ 12,966 $ ( 1,053,627 ) VF Corporation Q1 FY26 Form 10-Q 16 Table of Contents Reclassifications out of accumulated OCL were as follows: (In thousands) Three Months Ended June Details About Accumulated Other Comprehensive Loss Components Affected Line Item in the Consolidated Statements of Operations 2025 2024 Amortization of defined benefit pension plans: Net deferred actuarial losses Other income (expense), net $ ( 4,871 ) $ ( 5,046 ) Deferred prior service credits Other income (expense), net 153 144 Pension curtailment gains Other income (expense), net 531 — Total before tax ( 4,187 ) ( 4,902 ) Income tax effect 1,060 1,260 Net of tax ( 3,127 ) ( 3,642 ) Gains (losses) on derivative financial instruments: Foreign exchange contracts Revenues ( 1,971 ) ( 4,331 ) Foreign exchange contracts Cost of goods sold 15,034 ( 10,126 ) Foreign exchange contracts SG&A expenses ( 261 ) ( 408 ) Foreign exchange contracts Other income (expense), net 476 ( 56 ) Interest rate contracts Interest expense 27 27 Interest rate contracts Loss from discontinued operations, net of tax — 1,165 Total before tax 13,305 ( 13,729 ) Income tax effect ( 2,234 ) 2,989 Net of tax 11,071 ( 10,740 ) Total reclassifications for the period, net of tax $ 7,944 $ ( 14,382 ) NOTE 12 — STOCK-BASED COMPENSATION Incentive Equity Awards Granted During the three months ended June 2025, VF granted 1,474,178 restricted stock units ("RSUs") to executives that enable them to receive shares of VF Common Stock over a five-year vesting period. The fair market value of VF Common Stock at the date the units were granted was $ 12.55 per share. These units vest 25 % on the second, third, fourth and fifth anniversaries of the grant date. The number of units paid for the portion of the RSUs that vest on the fifth anniversary of the grant date are subject to relative total shareholder return ("TSR") targets set by the Talent and Compensation Committee of the Board of Directors, and will be paid in full or decreased to zero, based on how VF's TSR over the five-year period compares to the TSR for companies included in the Standard & Poor's 600 Consumer Discretionary Sector Index. The grant date fair value of the TSR-based adjustment related to the RSU grants was determined using a Monte Carlo simulation technique that incorporates option-pricing model inputs, and was $ 9.09 per share. During the three months ended June 2025, VF granted 146,135 nonperformance-based stock units to nonemployee members of the Board of Directors. These units vest upon grant and will be settled in shares of VF Common Stock one year from the date of grant. The fair market value of VF Common Stock at the date the units were granted was $ 12.55 per share. In addition, VF granted 4,329,031 nonperformance-based RSUs to employees and executives during the three months ended June 2025. These units generally vest over periods up to four years from the date of grant and each unit entitles the holder to one share of VF Common Stock. The weighted average fair market value of VF Common Stock at the dates the units were granted was $ 12.57 per share. NOTE 13 — INCOME TAXES The effective income tax rate for the three months ended June 2025 was 8.0 % compared t o 8.1 % in the 2024 period. The three months ended June 2025 included a net discrete tax expense of $ 11.5 million, which was comprised primarily of a $ 7.4 million net tax expense related to unrecognized tax benefits and interest, and a $ 4.1 million tax expense related to stock compensation. Excluding the $ 11.5 million net discrete tax expense in the 2025 period, the effective income tax rate would have been 17.2 %. The three months ended June 2024 included a net discrete tax expense of $ 7.1 million, w hich was comprised primarily of a $ 3.6 million net tax expense related to unrecognized tax benefits and interest, an d a $ 4.3 million tax expense related to stock compensation. Excluding the $ 7.1 million net discrete tax expense in the 2024 period, the effective income tax rate would have been 12.4 %. Without discrete items, the effective income tax rate for the three months ended June 2025 increased by 4.8 % c ompared with the 2024 period primarily due to an increase in tax rates on foreign earnings. 17 VF Corporation Q1 FY26 Form 10-Q Table of Contents VF files a consolidated U.S. federal income tax return, as well as separate and combined income tax returns in numerous state and international jurisdictions. In the U.S., the Internal Revenue Service ("IRS") examinations for tax years through 2015 have been effectively settled. In addition, VF is currently subject to examination by various state and international tax authorities. Management regularly assesses the potential outcomes of both ongoing and future examinations for the current and prior years and has concluded that VF’s provision for income taxes is adequate. The outcome of any one examination is not expected to have a material impact on VF’s consolidated financial statements. Management believes that some of these audits and negotiations will conclude during the next 12 months. On July 4, 2025, the U.S. signed into law the One Big Beautiful Bill Act, which included various provisions specific to businesses. This legislation was signed into law subsequent to VF’s quarter end and its impact on VF is currently being evaluated. During the three months ended June 2025, the amount of net unrecognized tax benefits and associated interest increased by $ 9.4 million to $ 335.0 million. Management believes that it is reasonably possible that the amount of unrecognized income tax benefits and interest may decrease during the next 12 months by approximately $ 137.4 million related to the completion of examinations and other settlements with tax authorities and the expiration of statutes of limitations, of which $ 134.3 million would reduce income tax expense. NOTE 14 — REPORTABLE SEGMENT INFORMATION VF's President and Chief Executive Officer is the Company's CODM. The Company's individual global brands, or in certain cases the combination of global brands, have been determined to be operating segments. The operating segments have been evaluated and aggregated into reportable segments because they meet the similar economic characteristics and qualitative aggregation criteria set forth in the relevant accounting guidance. In the first quarter of Fiscal 2026, VF realigned its reportable segments to reflect a change in how the Timberland ® brand is managed and the CODM's key areas of focus. VF began managing its Timberland ® and Timberland PRO ® brands as one operating segment during the first quarter of Fiscal 2026. This operating segment has been aggregated with The North Face ® brand in the Outdoor reportable segment and the Vans ® , Kipling ® , Eastpak ® and JanSport ® brands have been aggregated in the Active reportable segment. All other brands that have not been aggregated within the reportable segments described above, which do not meet the quantitative threshold to be disclosed as a separate reportable segment, have been grouped within an "All Other" category. This group includes the Dickies ® , Altra ® , Smartwool ® , Napapijri ® and Icebreaker ® brands. Results for the "All Other" category are included as a reconciling item between the Company's reportable segments and its consolidated results of operations and assets. Reportable segment results for all prior periods have been recast to reflect the change in reportable segments. These changes had no impact on previously reported consolidated results of operations. Below is a description of VF's reportable segments and the brands included within each: REPORTABLE SEGMENT BRANDS Outdoor - Outdoor apparel, footwear and equipment The North Face ® Timberland ® Active - Active apparel, footwear and accessories Vans ® Kipling ® Eastpak ® JanSport ® All Other - included in the tables below for purposes of reconciliation of revenues, profit and assets, but it is not considered a reportable segment. "All Other" includes the Dickies ® , Altra ® , Smartwool ® , Napapijri ® and Icebreaker ® brands. The primary financial measures used by the CODM to assess performance and allocate resources to VF's segments are segment revenues and segment profit. Segment profit comprises the operating income (loss) and other income (expense), net line items of each segment. Segment revenues and segment profit are regularly reviewed by the CODM and compared against historical results, forecast and budget information in order to make decisions about how to allocate capital and other resources to each segment. Corporate costs (other than common costs allocated to the segments), goodwill and indefinite-lived intangible asset impairment charges and net interest expense are not controlled by segment management and therefore are excluded from the measurement of segment profit. Common costs such as information systems processing, retirement benefits and insurance are allocated from corporate costs to the segments based on appropriate metrics such as usage or employment. Corporate costs that are not allocated to the segments consist of corporate headquarters expenses (including compensation and benefits of corporate management and staff, certain legal and professional fees and administrative and general costs), costs of corporate programs or corporate-managed decisions, and other expenses which include a portion of defined benefit pension costs, development costs for management information systems, costs of registering, maintaining and enforcing certain of VF’s trademarks and miscellaneous consolidated costs. Defined benefit pension plans in the U.S. are centrally managed. The current year service cost component of pension cost is allocated to the segments, while the remaining pension cost components are reported in corporate and other expenses. VF Corporation Q1 FY26 Form 10-Q 18 Table of Contents Segment assets are those used directly in or resulting from the operations of each business, which are accounts receivable and inventories. Segment assets included in the "All Other" category represent accounts receivable and inventory balances related to the brands included within the "All Other" category as noted above and segment assets included in the "Corporate and other" category represent receivable balances primarily related to corporate activities, and both are provided for purposes of reconciliation as they are not considered reportable segments. Total expenditures for additions to long-lived assets are not disclosed as this information is not regularly provided to the CODM at the segment level. Financial information for VF's segments is as follows: Three Months Ended June 2025 (In thousands) Outdoor Active Total Reportable segment revenues $ 812,466 $ 699,687 $ 1,512,153 "All Other" revenues 248,513 Total revenues 1,760,666 Less: Cost of goods sold 386,077 298,769 Marketing expenses 71,591 53,117 Other SG&A expenses 398,553 291,280 Other segment items (a) 1,485 317 Segment profit (loss) ( 42,270 ) 56,838 14,568 Corporate and other expenses ( 104,560 ) Interest expense, net ( 41,120 ) "All Other" profit 4,519 Loss from continuing operations before income taxes $ ( 126,593 ) (a) For each reportable segment, 'Other segment items' includes certain foreign currency and hedging gains and losses and other miscellaneous non-operating income and expenses, which are reported in the other income (expense), net line item in the Consolidated Statement of Operations. Three Months Ended June 2024 (In thousands) Outdoor Active Total Reportable segment revenues $ 753,630 $ 776,734 $ 1,530,364 "All Other" revenues 238,696 Total revenues 1,769,060 Less: Cost of goods sold 401,576 330,127 Marketing expenses 66,389 67,322 Other SG&A expenses 358,613 307,803 Other segment items (a) 61 ( 17 ) Segment profit (loss) ( 72,887 ) 71,465 ( 1,422 ) Corporate and other expenses ( 115,519 ) Interest expense, net (b) ( 40,947 ) "All Other" loss ( 7,565 ) Loss from continuing operations before income taxes $ ( 165,453 ) (a) For each reportable segment, 'Other segment items' includes certain foreign currency and hedging gains and losses and other miscellaneous non-operating income and expenses, which are reported in the other income (expense), net line item in the Consolidated Statement of Operations. (b) Interest expense and the related interest rate swap im pact for the DDTL, which totaled $ 14.9 million for the three months ended June 2024, were allocated to discontinued operations due to the requiremen t within the DDTL's amended agreement that the DDTL be prepaid upon the receipt of the net cash proceeds from the sale of Supreme. 19 VF Corporation Q1 FY26 Form 10-Q Table of Contents (In thousands) June 2025 March 2025 June 2024 Segment assets: Outdoor $ 1,791,623 $ 1,552,908 $ 1,638,703 Active 983,790 860,128 936,596 All Other 522,127 507,223 527,813 Corporate and other 10,161 28,429 5,984 Total segment assets 3,307,701 2,948,688 3,109,096 Cash and cash equivalents 642,386 429,382 625,436 Property, plant and equipment, net 720,785 720,879 759,811 Goodwill and intangible assets, net 2,344,578 2,314,093 2,413,985 Operating lease right-of-use assets 1,319,142 1,262,319 1,260,903 Other assets 1,815,905 1,702,175 1,714,100 Assets of discontinued operations — — 1,658,032 Consolidated assets $ 10,150,497 $ 9,377,536 $ 11,541,363 Three Months Ended June (In thousands) 2025 2024 Depreciation and amortization: Outdoor $ 25,974 $ 24,388 Active 13,378 14,106 All Other 4,942 5,290 Corporate and other 20,068 20,841 $ 64,362 $ 64,625 NOTE 15 — NET LOSS PER SHARE Three Months Ended June (In thousands, except per share amounts) 2025 2024 Net loss per common share – basic: Loss from continuing operations $ ( 116,408 ) $ ( 152,027 ) Weighted average common shares outstanding 390,024 388,741 Net loss per common share from continuing operations $ ( 0.30 ) $ ( 0.39 ) Net loss per common share – diluted: Loss from continuing operations $ ( 116,408 ) $ ( 152,027 ) Weighted average common shares outstanding 390,024 388,741 Incremental shares from stock options and other dilutive securities — — Adjusted weighted average common shares outstanding 390,024 388,741 Net loss per common share from continuing operations $ ( 0.30 ) $ ( 0.39 ) In the three-month periods ended June 2025 and June 2024, the dilutive impacts of all outstanding stock options and other dilutive securities were excluded from dilutive shares as a result of the Company's loss from continuing operations for the periods and, as such, their inclusion would have been anti-dilutive. As a result, a total of 29.0 million and 22.6 million potentially dilutive shares related to stock options and other dilutive securities were excluded from the diluted net loss per share calculations for the three-month periods ended June 2025 and June 2024, respectively. VF Corporation Q1 FY26 Form 10-Q 20 Table of Contents NOTE 16 — FAIR VALUE MEASUREMENTS Financial assets and financial liabilities measured and reported at fair value are classified in a three-level hierarchy that prioritizes the inputs used in the valuation process. A financial instrument’s categorization within the valuation hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The hierarchy is based on the observability and objectivity of the pricing inputs, as follows: • Level 1 — Quoted prices in active markets for identical assets or liabilities. • Level 2 — Significant directly observable data (other than Level 1 quoted prices) or significant indirectly observable data through corroboration with observable market data. Inputs would normally be (i) quoted prices in active markets for similar assets or liabilities, (ii) quoted prices in inactive markets for identical or similar assets or liabilities, or (iii) information derived from or corroborated by observable market data. • Level 3 — Prices or valuation techniques that require significant unobservable data inputs. These inputs would normally be VF’s own data and judgments about assumptions that market participants would use in pricing the asset or liability. Recurring Fair Value Measurements The following table summarizes financial assets and financial liabilities that are measured and recorded in the consolidated financial statements at fair value on a recurring basis: Total Fair Value Fair Value Measurement Using (a) (In thousands) Level 1 Level 2 Level 3 June 2025 Financial assets: Cash equivalents: Money market funds $ 50,914 $ 50,914 $ — $ — Time deposits 50,267 50,267 — — Derivative financial instruments 18,656 — 18,656 — Deferred compensation and other 82,745 82,745 — — Financial liabilities: Derivative financial instruments 130,029 — 130,029 — Deferred compensation 76,449 — 76,449 — Contingent consulting fees 2,861 — — 2,861 Total Fair Value Fair Value Measurement Using (a) (In thousands) Level 1 Level 2 Level 3 March 2025 Financial assets: Cash equivalents: Money market funds $ 79,485 $ 79,485 $ — $ — Time deposits 12,280 12,280 — — Derivative financial instruments 34,371 — 34,371 — Deferred compensation and other 78,769 78,769 — — Financial liabilities: Derivative financial instruments 30,003 — 30,003 — Deferred compensation 75,046 — 75,046 — Contingent consulting fees 23,900 — — 23,900 (a) There w er e no t ransfers amon g the levels within the fair value hierarchy during the three months ended June 2025 or the year ended March 2025. The following table presents the change in fair value of the contingent consulting fees designated as Level 3: (In thousands) Contingent Consulting Fees Balance, March 2025 $ 23,900 Cash payments ( 20,000 ) Change in fair value ( 1,039 ) Balance, June 2025 $ 2,861 21 VF Corporation Q1 FY26 Form 10-Q Table of Contents VF’s cash equivalents include money market funds and time deposits with maturities within three months of their purchase dates, that approximate fair value based on Level 1 measurements. The fair value of derivative financial instruments, which consist of foreign exchange forward contracts and interest rate swap contracts (through their settlement in the three months ended December 2024), is d etermined based on observable market inputs (Level 2), including spot and forward exchange rates for foreign currencies and interest rate forward curves, and considers the credit risk of the Company and its counterparties. VF’s deferred compensation assets primarily represent investments held within plan trusts as an economic hedge of the related deferred compensation liabilities. These investments primarily include mutual funds (Level 1) that are valued based on quoted prices in active markets. Liabilities related to VF’s deferred compensation plans are recorded at amounts due to participants, based on the fair value of the participants’ selection of hypothetical investments. During the second quarter of Fiscal 2025, VF entered into a contract with a consulting firm to support Reinvent, VF's transformation program. Fees related to this contract could be up to $ 141.0 million, which includes $ 66.0 million of fixed fees and $ 75.0 million of contingent fees tied to increases in VF's stock price. The contingent fees are accounted for under Accounting Standards Codification Topic 718 — Stock Compensation ("ASC 718") as a liability award to a non-employee. Accordingly, VF has utilized the Monte Carlo valuation model (Level 3) to estimate the fair value of the award at its inception, and will adjust such fair value on a quarterly basis over the measurement period, which concludes on June 30, 2027. Changes in the fair value are recognized in the SG&A expenses line item in the Consolidated Statements of Operations over the relevant service period. The valuation includes the effects of market conditions that are based upon VF's stock price performance relative to stock price targets and a minimum payout dependent on the Standard & Poor's 500 Index return and VF's TSR versus that of peer companies over the measurement period. During the three months ended June 2025, $ 20.0 million of contingent fees were paid to the consulting firm. As of June 2025, the total fair val ue of the remaining contingent fees was $ 4.3 million , w ith ($ 1.0 ) million rec ognized in the three months ended June 2025. All other significant financial assets and financial liabilities are recorded in the consolidated financial statements at cost, except life insurance contracts which are recorded at cash surrender value. These other financial assets and financial liabilities include cash held as demand deposits, accounts receivable, short-term borrowings, accounts payable and accrued liabilities. At June 2025 and March 2025, their carrying values approximated their fair values. Additionally, at June 2025 and March 2025, the carrying values of VF’s long-term debt, including the current portio n, were $ 4,147.0 million and $ 3,966.2 million, respectively, compared with fair values of $ 3,680.1 million and $ 3,628.8 million at those respective dates. Fair val ue for long-term debt is a Level 2 estimate based on quoted market prices or values of comparable borrowings. NOTE 17 — DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES Summary of Derivative Financial Instruments All of VF’s outstanding derivative financial instruments at June 2025 are foreign currency exchange forward contracts. Although derivatives meet the criteria for hedge accounting at the inception of the hedging relationship, a limited number of derivative contracts intended to hedge assets and liabilities are not designated as hedges for accounting purposes. The notional amounts of all outstanding foreign currency exchange forward contracts we re $ 3.2 billion at June 2025 and $ 3.1 billion at March 2025 and June 2024, consisting primarily of contracts hedging exposures to the euro, British pound, Canadian dollar, Swiss franc, Chinese renminbi, Mexican peso, Polish zloty, Swedish krona, South Korean won and Japanese yen. These derivative contracts have maturities up to 20 months. During the three months ended December 2024, VF settled interest rate swap contracts that were in place to hedge the cash flow risk of interest payments on the variable-rate DDTL Agreement. The DDTL was prepaid on October 4, 2024. The notional amount of VF's outstanding interest rate swap contracts was $ 500.0 million at June 2024. The following table presents outstanding derivatives on an individual contract basis: Fair Value of Derivatives with Unrealized Gains Fair Value of Derivatives with Unrealized Losses (In thousands) June 2025 March 2025 June 2024 June 2025 March 2025 June 2024 Derivatives Designated as Hedging Instruments: Foreign exchange contracts $ 18,528 $ 32,608 $ 38,160 $ ( 129,307 ) $ ( 29,847 ) $ ( 27,436 ) Interest rate contracts — — 1,690 — — — Total derivatives designated as hedging instruments 18,528 32,608 39,850 ( 129,307 ) ( 29,847 ) ( 27,436 ) Derivatives Not Designated as Hedging Instruments: Foreign exchange contracts 128 1,763 1,507 ( 722 ) ( 156 ) ( 142 ) Total derivatives $ 18,656 $ 34,371 $ 41,357 $ ( 130,029 ) $ ( 30,003 ) $ ( 27,578 ) VF Corporation Q1 FY26 Form 10-Q 22 Table of Contents VF records and presents the fair values of all of its derivative assets and liabilities in the Consolidated Balance Sheets on a gross basis, even though they are subject to master netting agreements. If VF were to offset and record the asset and liability balances on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Consolidated Balance Sheets would be adjusted from the current gross presentation to the net amounts as detailed in the following table: June 2025 March 2025 June 2024 (In thousands) Derivative Asset Derivative Liability Derivative Asset Derivative Liability Derivative Asset Derivative Liability Gross amounts presented in the Consolidated Balance Sheets $ 18,656 $ ( 130,029 ) $ 34,371 $ ( 30,003 ) $ 41,357 $ ( 27,578 ) Gross amounts not offset in the Consolidated Balance Sheets ( 17,940 ) 17,940 ( 13,592 ) 13,592 ( 6,699 ) 6,699 Net amounts $ 716 $ ( 112,089 ) $ 20,779 $ ( 16,411 ) $ 34,658 $ ( 20,879 ) Derivatives are classified as current or noncurrent based on maturity dates, as follows: (In thousands) June 2025 March 2025 June 2024 Derivative Instruments Balance Sheet Location Foreign exchange contracts Other current assets $ 14,964 $ 32,290 $ 33,562 Foreign exchange contracts Accrued liabilities ( 101,114 ) ( 19,810 ) ( 24,802 ) Foreign exchange contracts Other assets 3,692 2,081 6,105 Foreign exchange contracts Other liabilities ( 28,915 ) ( 10,193 ) ( 2,776 ) Interest rate contracts Other current assets — — 1,690 Cash Flow Hedges VF primarily uses foreign currency exchange forward contracts to hedge a portion of the exchange risk for its forecasted sales, inventory purchases, operating costs and certain intercompany transactions, including sourcing and management fees and royalties. The Company also used interest rate swap contracts to hedge against a portion of the exposure related to its interest payments on its variable-rate debt, which was prepaid on October 4, 2024. The effects of cash flow hedging included in VF’s Consolidated Statements of Comprehensive Loss and Consolidated Statements of Operations are summarized as follows: (In thousands) Gain (Loss) on Derivatives Recognized in Accumulated OCL Three Months Ended June Cash Flow Hedging Relationships 2025 2024 Foreign exchange contracts $ ( 131,290 ) $ 19,501 Interest rate contracts — 520 Total $ ( 131,290 ) $ 20,021 (In thousands) Gain (Loss) Reclassified from Accumulated OCL into Net Loss Three Months Ended June Cash Flow Hedging Relationships Location of Gain (Loss) 2025 2024 Foreign exchange contracts Revenues $ ( 1,971 ) $ ( 4,331 ) Foreign exchange contracts Cost of goods sold 15,034 ( 10,126 ) Foreign exchange contracts SG&A expenses ( 261 ) ( 408 ) Foreign exchange contracts Other income (expense), net 476 ( 56 ) Interest rate contracts Interest expense 27 27 Interest rate contracts Loss from discontinued operations, net of tax — 1,165 Total $ 13,305 $ ( 13,729 ) Derivative Contracts Not Designated as Hedges VF uses foreign currency exchange contracts to manage foreign currency exchange risk on third-party and intercompany accounts receivable and payable, as well as third-party and intercompany borrowings and interest payments. These contracts are not designated as hedges, and are recorded at fair value in the Consolidated Balance Sheets. Changes in the fair values of these instruments are recognized directly in earnings. Gains or losses on these contracts largely offset the net transaction losses or gains on the related assets and liabilities. 23 VF Corporation Q1 FY26 Form 10-Q Table of Contents In the case of derivative contracts executed on foreign currency exposures that are no longer probable of occurring, VF de-designates these hedges and the fair value changes of these instruments are also recognized directly in earnings. The impact of de-designated derivative contracts and changes in the fair value of derivative contracts not designated as hedges, recognized as gains or losses in VF's Consolidated Statements of Operations were not material for the three months ended June 2025 and June 2024. Other Derivative Information At June 2025, accumulated OCL included $ 50.9 million of pre-tax net deferred losses for foreign currency exchange contracts that are expected to be reclassified to earnings during the next 12 months. The amounts ultimately reclassified to earnings will depend on exchange rates in effect when outstanding derivative contracts are settled. Net Investment Hedge The Company has designated its euro-denominated fixed-rate notes, which represented € 2.0 billion in aggregate principal as of June 2025, as a net investment hedge of VF’s investment in certain foreign operations. Because this debt qualified as a nonderivative hedging instrument, foreign currency transaction gains or losses of the debt are deferred in the foreign currency translation and other component of accumulated OCL as an offset to the foreign currency translation adjustments on the hedged investments. During the three-month period ended June 2025, the Company recognized an after-tax loss of $ 134.4 million in other comprehensive income (loss) related to the net investment hedge transaction and an after-tax gain of $ 10.8 million for the three-month period ended June 2024. Any amounts deferred in accumulated OCL will remain until the hedged investment is sold or substantially liquidated. NOTE 18 — RESTRUCTURING The Company incurs restructuring charges related to strategic initiatives and cost optimization of business activities. A description of significant restructuring programs and other restructuring charges is provided below. Reinvent On October 30, 2023, VF introduced Reinvent, a transformation program to enhance focus on brand-building and to improve operating performance and allow VF to achieve its full potential. All actions related to the program were substantially complete at the end of the first quarter of Fiscal 2026. Of the total charges, 73 % related to severance and employee-related benefits and the remainder primarily related to asset impairments and write-downs. Cash payments are generally expected to be paid within one year of charges incurred. During the three months ended June 2025, $ 22.5 million of cash payments related to the Reinvent charges were made. The type of cost and respective location of restructuring charges related to Reinvent within VF's Consolidated Statement of Operations for the three months ended June 2025 and 2024, and the cumulative charges recorded since the inception of Reinvent were as follows: Three Months Ended June Cumulative Charges (In thousands) 2025 2024 Type of Cost Location Severance and employee-related benefits SG&A expenses $ 11,248 $ 11,141 $ 142,072 Severance and employee-related benefits Cost of goods sold 4,225 181 10,408 Contract termination and other SG&A expenses 326 737 1,063 Contract termination and other Cost of goods sold — 157 157 Asset impairments and write-downs SG&A expenses 2,200 500 50,369 Pension withdrawal SG&A expenses — — 3,619 Curtailment gains Other income (expense), net ( 531 ) — ( 1,467 ) Accelerated depreciation SG&A expenses — 861 1,317 Accelerated depreciation Cost of goods sold — 17 17 Total Reinvent Restructuring Charges $ 17,468 $ 13,594 $ 207,555 All restructuring charges related to Reinvent recognized in the three months ended June 2025 and 2024 were reported within 'Corporate and other' expenses in Note 14, Reportable Segment Information. VF Corporation Q1 FY26 Form 10-Q 24 Table of Contents Other Restructuring Charges Other Restructuring Charges are related to various approved initiatives. The type of cost and respective location of Other Restructuring Charges within VF's Consolidated Statement of Operations for the three months ended June 2025 and 2024 were as follows: Three Months Ended June (In thousands) 2025 2024 Type of Cost Location Contract termination and other SG&A expenses $ — $ 437 Total Other Restructuring Charges $ — $ 437 All restructuring charges related to Other recognized in the three months ended June 2025 and 2024 were reported within 'Corporate and other' expenses in Note 14, Reportable Segment Information. Consolidated Restructuring Charges The activity in the restructuring accrual related to Reinvent and Other Restructuring Charges for the three-month period ended June 2025 was as follows: (In thousands) Severance Other Total Accrual at March 2025 $ 65,250 $ 337 $ 65,587 Charges 15,473 — 15,473 Cash payments and settlements ( 22,583 ) — ( 22,583 ) Adjustments to accruals — — — Impact of foreign currency 805 — 805 Accrual at June 2025 $ 58,945 $ 337 $ 59,282 Of the $ 59.3 million total restructuring accrual at June 2025, $ 58.9 million is expected to be paid within the next 12 months and is classified within accrued liabilities. The remaining $ 0.4 million will be paid beyond the next 12 months and is classified within other liabilities. The Company has not recognized any significant incremental costs related to the accruals for the year ended March 2025 or prior periods. NOTE 19 — SUBSEQUENT EVENT On July 22, 2025, VF’s Board of Directors declared a quarterly cash dividend of $ 0.09 per share, payable on September 18, 2025 to stockholders of record on September 10, 2025. 25 VF Corporation Q1 FY26 Form 10-Q Table of Contents