Cover
Cover - USD ($) | 12 Months Ended | ||
Jan. 29, 2023 | Mar. 15, 2023 | Jul. 29, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Current Fiscal Year End Date | --01-29 | ||
Document Period End Date | Jan. 29, 2023 | ||
Document Transition Report | false | ||
Entity File Number | 001-38555 | ||
Entity Registrant Name | THE LOVESAC COMPANY | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 32-0514958 | ||
Entity Address, Address Line One | Two Landmark Square, | ||
Entity Address, Address Line Two | Suite 300 | ||
Entity Address, City or Town | Stamford, | ||
Entity Address, State or Province | CT | ||
Entity Address, Postal Zip Code | 06901 | ||
City Area Code | 888 | ||
Local Phone Number | 636-1223 | ||
Title of 12(b) Security | Common Stock, $0.00001 par value per share | ||
Trading Symbol | LOVE | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 439,821,967 | ||
Entity Common Stock, Shares Outstanding | 15,195,566 | ||
Documents Incorporated by Reference | Certain portions of the registrant's definitive proxy statement relating to its 2023 Annual Meeting of Stockholders, or the 2023 Proxy Statement, to be filed with the Securities and Exchange Commission, are incorporated by reference into Part III of this Annual Report on Form 10-K. Such 2023 Proxy Statement will be filed with the U.S. Securities and Exchange Commission within 120 days after the end of the fiscal year to which this report relates. Except with respect to information specifically incorporated by reference in this Form 10-K, the proxy statement is not deemed to be filed as part of this Form 10-K. | ||
Entity Central Index Key | 0001701758 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Filer Category | Accelerated Filer |
Audit Information
Audit Information | 12 Months Ended | |
Jan. 29, 2023 | Jan. 30, 2022 | |
Audit Information [Abstract] | ||
Auditor Firm ID | 34 | 688 |
Auditor Name | Deloitte & Touche LLP | Marcum LLP |
Auditor Location | Stamford, Connecticut | Hartford, CT |
Balance Sheets
Balance Sheets - USD ($) $ in Thousands | Jan. 29, 2023 | Jan. 30, 2022 |
Current Assets | ||
Cash and cash equivalents | $ 43,533 | $ 92,392 |
Trade accounts receivable | 9,469 | 8,547 |
Merchandise inventories, net | 119,962 | 108,493 |
Prepaid expenses and other current assets | 21,077 | 15,726 |
Total Current Assets | 194,041 | 225,158 |
Property and equipment, net | 52,904 | 34,137 |
Operating lease right-of-use assets | 138,271 | 100,891 |
Other Assets | ||
Goodwill | 144 | 144 |
Intangible assets, net | 1,411 | 1,413 |
Deferred tax asset | 9,420 | 9,836 |
Other assets | 21,863 | 0 |
Total Other Assets | 32,838 | 11,393 |
Total Assets | 418,054 | 371,579 |
Current Liabilities | ||
Accounts payable | 24,576 | 33,247 |
Accrued expenses | 23,392 | 40,497 |
Payroll payable | 6,783 | 9,978 |
Customer deposits | 6,760 | 13,316 |
Current operating lease liabilities | 21,898 | 16,382 |
Sales taxes payable | 5,430 | 5,359 |
Total Current Liabilities | 88,839 | 118,779 |
Operating Lease Liabilities, long term | 135,955 | 96,574 |
Line of Credit | 0 | 0 |
Total Liabilities | 224,794 | 215,353 |
Commitments and Contingencies (see Note 8) | ||
Stockholders’ Equity | ||
Preferred Stock $0.00001 par value, 10,000,000 shares authorized, no shares issued or outstanding as of Jan 29, 2023 and Jan 30, 2022. | 0 | 0 |
Common Stock $0.00001 par value, 40,000,000 shares authorized, 15,195,698 shares issued and outstanding as of Jan 29, 2023 and 15,123,338 shares issued and outstanding as of Jan 30, 2022. | 0 | 0 |
Additional paid-in capital | 182,554 | 173,762 |
Accumulated income (deficit) | 10,706 | (17,536) |
Stockholders’ Equity | 193,260 | 156,226 |
Total Liabilities and Stockholders’ Equity | $ 418,054 | $ 371,579 |
Balance Sheets (Parenthetical)
Balance Sheets (Parenthetical) - $ / shares | Jan. 29, 2023 | Jan. 30, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.00001 | $ 0.00001 |
Common stock, shares authorized (in shares) | 40,000,000 | 40,000,000 |
Common stock, shares issued (in shares) | 15,195,698 | 15,123,338 |
Common stock, shares outstanding (in shares) | 15,195,698 | 15,123,338 |
Statements of Operations
Statements of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Income Statement [Abstract] | |||
Net sales | $ 651,545 | $ 498,239 | $ 320,738 |
Cost of merchandise sold | 305,719 | 224,894 | 145,966 |
Gross profit | 345,826 | 273,345 | 174,772 |
Operating expenses | |||
Selling, general and administration expenses | 216,103 | 161,967 | 111,354 |
Advertising and marketing | 79,864 | 65,078 | 41,925 |
Depreciation and amortization | 10,842 | 7,859 | 6,613 |
Total operating expenses | 306,809 | 234,904 | 159,892 |
Operating income | 39,017 | 38,441 | 14,880 |
Interest expense, net | (117) | (179) | (67) |
Net income before taxes | 38,900 | 38,262 | 14,813 |
(Provision for) benefit from income taxes | (10,658) | 7,638 | (86) |
Net income | $ 28,242 | $ 45,900 | $ 14,727 |
Net income per common share: | |||
Basic (in dollars per share) | $ 1.86 | $ 3.04 | $ 1.01 |
Diluted (in dollars per share) | $ 1.77 | $ 2.86 | $ 0.96 |
Weighted average number of common shares outstanding: | |||
Basic (in shares) | 15,198,754 | 15,107,958 | 14,610,617 |
Diluted (in shares) | 15,955,668 | 16,058,111 | 15,332,998 |
Statements of Changes in Stockh
Statements of Changes in Stockholders' Equity - USD ($) $ in Thousands | Total | Common Shares | Additional Paid-in Capital | Accumulated Deficit |
Balance (in shares) at Feb. 02, 2020 | 14,472,611 | |||
Balance at Feb. 02, 2020 | $ 90,155 | $ 0 | $ 168,318 | $ (78,163) |
Net income (loss) | 14,727 | 14,727 | ||
Equity-based compensation | 4,681 | 4,681 | ||
Issuance of common stock for restricted stock (in shares) | 99,498 | |||
Taxes paid for net share settlement of equity awards | (1,717) | (1,717) | ||
Exercise of warrants (in shares) | 439,447 | |||
Exercise of warrants | 100 | 100 | ||
Balance (in shares) at Jan. 31, 2021 | 15,011,556 | |||
Balance at Jan. 31, 2021 | 107,946 | $ 0 | 171,382 | (63,436) |
Net income (loss) | 45,900 | 45,900 | ||
Equity-based compensation | 5,859 | 5,859 | ||
Issuance of common stock for restricted stock (in shares) | 100,826 | |||
Taxes paid for net share settlement of equity awards | (3,583) | (3,583) | ||
Exercise of warrants (in shares) | 10,956 | |||
Exercise of warrants | 104 | 104 | ||
Balance (in shares) at Jan. 30, 2022 | 15,123,338 | |||
Balance at Jan. 30, 2022 | 156,226 | $ 0 | 173,762 | (17,536) |
Net income (loss) | 28,242 | 28,242 | ||
Equity-based compensation | 10,450 | 10,450 | ||
Issuance of common stock for restricted stock (in shares) | 72,360 | |||
Taxes paid for net share settlement of equity awards | (1,658) | (1,658) | ||
Balance (in shares) at Jan. 29, 2023 | 15,195,698 | |||
Balance at Jan. 29, 2023 | $ 193,260 | $ 0 | $ 182,554 | $ 10,706 |
Statements of Cash Flows
Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Cash Flows from Operating Activities | |||
Net income | $ 28,242 | $ 45,900 | $ 14,727 |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | |||
Depreciation and amortization of property and equipment | 10,454 | 7,154 | 6,100 |
Amortization of intangible assets | 388 | 705 | 513 |
Amortization of deferred financing fees | 164 | 91 | 88 |
Net loss on disposal of property and equipment | 45 | 464 | 5 |
Impairment of long-lived assets | 0 | 554 | 245 |
Equity-based compensation | 10,450 | 5,859 | 4,681 |
Deferred rent | 0 | 0 | 3,641 |
Non-cash lease expense | 19,265 | 14,953 | 0 |
Deferred income taxes | 416 | (9,836) | 0 |
Gain on recovery of insurance proceeds - lost profit margin | 0 | (632) | 0 |
Changes in operating assets and liabilities: | |||
Trade accounts receivable | (921) | (4,034) | 2,675 |
Merchandise inventories | (11,470) | (56,819) | (14,017) |
Prepaid expenses and other current assets | 890 | (2,459) | (2,060) |
Other assets | (21,459) | 0 | 0 |
Accounts payable and accrued expenses | (33,002) | 39,195 | 19,584 |
Operating lease liabilities | (18,281) | (14,400) | 0 |
Customer deposits | (6,556) | 7,323 | 4,339 |
Net Cash (Used in) Provided by Operating Activities | (21,375) | 34,018 | 40,521 |
Cash Flows from Investing Activities | |||
Purchase of property and equipment | (25,242) | (15,887) | (8,374) |
Payments for patents and trademarks | (307) | (601) | (678) |
Net Cash Used in Investing Activities | (25,549) | (16,488) | (9,052) |
Cash Flows from Financing Activities | |||
Taxes paid for net share settlement of equity awards | (1,658) | (3,583) | (1,717) |
Proceeds from the exercise of warrants | 0 | 104 | 100 |
Payment of deferred financing costs | (277) | 0 | (50) |
Net Cash Used in Financing Activities | (1,935) | (3,479) | (1,667) |
Net Change in Cash and Cash Equivalents | (48,859) | 14,051 | 29,802 |
Cash and Cash Equivalents - Beginning | 92,392 | 78,341 | 48,539 |
Cash and Cash Equivalents - End | 43,533 | 92,392 | 78,341 |
Supplemental Cash Flow Disclosures | |||
Cash paid for taxes | 10,670 | 1,121 | 86 |
Cash paid for interest | 192 | 95 | 85 |
Non-cash investing activities: | |||
Asset acquisitions not yet paid for at end of year | $ 4,103 | $ 0 | $ 0 |
Basis of Presentation, Operatio
Basis of Presentation, Operations and Liquidity, and Significant Accounting Policies | 12 Months Ended |
Jan. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation, and Summary of Significant Accounting Policies | Basis of Presentation, and Summary of Significant Accounting Policies Nature of Operations The Lovesac Company (the “Company”, “we”, “us” or “our”)is a technology driven company that designs, manufactures and sells unique, high quality furniture derived through its proprietary "Designed for Life" approach which results in products that are built to last a lifetime and designed to evolve as our customers’ lives do. The Company markets and sells its products through modern and efficient showrooms and, increasingly, through online sales directly at www.lovesac.com, supported by direct-to-consumer touch-feel points in the form of our own showrooms, which include our newly created mobile concierge and kiosks, as well as through shop-in-shops and online pop-up-shops with third party retailers. As of January 29, 2023, the Company operated 195 showrooms including kiosks and mobile concierges located throughout the United States. The Company was formed as a Delaware corporation on January 3, 2017, in connection with a corporate reorganization with SAC Acquisition LLC, a Delaware limited liability company (“SAC LLC”), the predecessor entity to the Company. Basis of Presentation The financial statements of the Company as of January 29, 2023 and January 30, 2022 and for the years ended January 29, 2023, January 30, 2022 and January 31, 2021 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission. Fiscal Year The Company’s fiscal year is determined on a 52/53 week basis ending on the Sunday closest to February 1. Hereinafter, fiscal years ended January 29, 2023, January 30, 2022 and January 31, 2021 are referred to as fiscal 2023, 2022 and 2021, respectively. Fiscal 2023, 2022 and 2021 were 52-week fiscal years. Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. The Company evaluates its estimates and judgements on an ongoing basis based on historical experience, expectations of future events and various other factors we believe to be reasonable under the circumstances and revise them when necessary in the period the change is determined. Actual results may differ from the original or revised estimates. Revenue Recognition Our revenue consists substantially of product sales. The Company reports product sales net of discounts and recognized at a point in time when control transfers to the customer, which occurs when products are shipped. The Company excludes from the measurement of the transaction price all taxes assessed by governmental authorities collected from a customer, including sales, use, excise, value-added, and franchise taxes (collectively referred to as sales taxes). The Company applies the practical expedient for contracts with duration of one year or less and therefore does not consider the effects of the time value of money. Shipping and handling charges billed to customers are included in revenue. The Company recognizes shipping and handling expense as fulfillment activities (rather than a promised good or service) when the activities are performed. Accordingly, the Company records the expenses for shipping and handling activities at the same time the Company recognizes revenue. Shipping and handling costs incurred are included in cost of merchandise sold and include inbound freight and tariff costs relative to inventory sold, warehousing, and last mile shipping to our customers. Shipping and handling costs were $158.0 million in fiscal 2023, $112.8 million in fiscal 2022, and $63.1 million in fiscal 2021. Estimated refunds for returns are recorded using our historical return patterns, adjusting for any changes in returns policies and current product performance. The Company records estimated refunds for net sales returns on a monthly basis as a reduction of net sales and cost of sales on the statement of operations and an increase in inventory and customers return liability on the balance sheet. As of January 29, 2023 and January 30, 2022, we recorded a return liability of $4.5 million and $2.0 million within accrued expenses, and a corresponding asset for the net realizable value of inventory to be returned for $1.0 million and $0.4 million, respectively, in merchandise inventories on our Balance Sheet. In some cases, deposits are received before the Company transfers control, resulting in the recognition of contract liabilities, reported as customer deposits on our Balance Sheet. As of January 29, 2023, and January 30, 2022, the Company recorded customer deposit liabilities the amount of $6.8 million and $13.3 million, respectively. During the years ended January 29, 2023, and January 30, 2022, the Company recognized $13.3 million and $6.0 million related to customer deposits from fiscal 2022 and 2021. The Company offers its products through showrooms and through the Internet. The other channel predominantly represents sales through the use of online and in store pop-up shops, shop-in-shops, and barter inventory transactions. In store pop-up-shops are staffed with associates trained to demonstrate and sell our product. The following represents sales disaggregated by channel: (in thousands) 2023 2022 2021 Showrooms $ 398,550 $ 298,989 $ 146,150 Internet 176,519 150,622 151,065 Other 76,476 48,628 23,523 Total net sales $ 651,545 $ 498,239 $ 320,738 The Company has no foreign operations and its sales to foreign countries was less than .01% of total net sales in fiscal 2023, 2022, and 2021. The Company had no customers in fiscal 2023, 2022, or 2021 that comprise more than 10% of total net sales. See Note 11. Segment Information for net sales disaggregated by product . Barter Arrangements The Company has a bartering arrangement with a third-party vendor. The Company repurposes returned open-box inventory in exchange for media credits, which are being used to support our advertising initiatives to create brand awareness and drive net sales growth. Barter transactions with commercial substance are recorded at a transaction price based on the estimated fair value of the non-cash consideration of the media credits to be received and the revenue is recognized when control of inventory is transferred, which is when the inventory is picked up in our warehouse. Fair value is estimated using various considerations, including the cost of similar media advertising if transacted directly, the expected sales price of product given up in exchange for the media credits, and the expected usage of media credits prior to expiration based on a marketing spend forecast. The Company recognizes an asset for media credits which is subsequently evaluated for impairment at each reporting period for any changes in circumstances. As the barter credits are expected to be utilized at various dates through their expiration dates, the Company will classify the amount expected to be utilized in the next fiscal year as current, which is included in Prepaid and Other Current Assets, with the remaining balance included as part of Other Assets on the balance sheet. For the year ended January 29, 2023, and January 30, 2022, the Company recognized $21.3 million and $3.5 million, respectively, of barter sales in exchange for media credits. The Company had $25.2 million and $3.4 million of unused media credits as of January 29, 2023, and January 30, 2022, respectively, and did not recognize any impairment. The difference between the opening and closing balances of the Company's prepaid barter credit primarily results from the inventory exchanged for media credits during the period, offset by utilization of those credits. Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity at purchase of three months or less to be cash equivalents. The Company has deposits with financial institutions that maintain Federal Deposit Insurance Corporation “FDIC” deposit insurance up to $250,000 per depositor. The portion of the deposit in excess of this limit represents a credit risk to the Company. Due to the high cash balance maintained by the Company, the Company does maintain depository balances in excess of the insured amounts. Trade Accounts Receivable, net Trade accounts receivable are stated at their estimated realizable amount and do not bear interest for which collectability is reasonably assured. Management determines the allowance for doubtful accounts by regularly evaluating individual customer accounts, considering the customer’s financial condition, and credit history, and general and industry current economic conditions. Trade accounts receivables are evaluated for collectability on a regular basis and an allowance is recorded, if necessary. Recoveries of amounts previously written off are recorded when received. Historically, collection losses have been immaterial as a significant portion of the Company’s receivables are related to individual credit card transactions and two wholesale customers. The Company recognized $0.4 million related to bad debt write-offs for fiscal 2023, and 2022, and recognized $0.8 million for fiscal 2021, respectively. Breakdown of trade accounts receivable is as follows: (in thousands) As of January 29, 2023 As of January 30, 2022 Credit card receivables $ 5,069 $ 3,186 Wholesale receivables 4,400 5,361 Total trade receivable, net $ 9,469 $ 8,547 The Company had two wholesale customers that comprised 100% of wholesale receivables at January 29, 2023 and January 30, 2022, respectively. Prepaid Expenses and Other Current Assets The Company recognizes payments made for goods and services to be received in the near future as prepaid expenses and other current assets. Prepaid expenses and other current assets consist primarily of payments related to insurance premiums, deposits, prepaid rent, prepaid inventory, and other costs. Merchandise Inventories, net Merchandise inventories are comprised of finished goods which are carried at the lower of cost or net realizable value. Cost is determined on a weighted-average method basis. Merchandise inventories consist primarily of foam filled furniture, sectional couches, and related accessories. The Company adjusts its inventory for obsolescence based on historical trends, aging reports, specific identification and its estimates of future retail sales prices. In addition, the Company includes capitalized freight and warehousing costs in inventory relative to the finished goods in inventory. Gift Certificates and Merchandise Credits The Company sells gift certificates and issues merchandise credits to its customers in the showrooms and through its website. Revenue associated with gift certificates and merchandise credits is deferred until redemption of the gift certificate and merchandise credits. The Company did not recognize any breakage revenue in fiscal 2023, fiscal 2022 or fiscal 2021 as the Company continues to honor all outstanding gift certificates. Property and Equipment, net Property and equipment are stated at cost less accumulated depreciation and amortization. Office and showroom furniture and equipment, software and vehicles are depreciated using the straight-line method over their estimated useful lives. Leasehold improvements are amortized using the straight-line method over their expected useful lives or lease term, whichever is shorter. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation or amortization is removed from the accounts, and any resulting gain or loss is reflected in operations for the period. The disposals generally relate to the decommissioning of aged assets, remodeled showrooms, and fixtures used during pop-up-shops. Expenditures for major betterments that extend the useful lives of property and equipment are capitalized. Goodwill Goodwill represents the excess of the purchase price over the fair value of the identified net assets of each business acquired. Goodwill and other indefinite-lived intangible assets are tested annually for impairment in the fourth fiscal quarter and in interim periods if certain events occur indicating that the carrying amounts may be impaired. If a qualitative assessment is used and the Company determines that the fair value of a reporting unit or indefinite-lived intangible asset is more likely than not (i.e., a likelihood of more than 50%) less than its carrying amount, a quantitative impairment test will be performed. If goodwill is quantitatively assessed for impairment, a two-step approach is applied. There were no impairments during fiscal 2023, 2022, or 2021. Intangible Assets, net Intangible assets with finite useful lives, including patents, trademarks, and other intangible assets are being amortized on a straight-line basis over their estimated lives of 10 years, 3 years, and 5 years, respectively. Intangible assets with finite useful lives are reviewed for impairment whenever events or circumstances indicate that the carrying amount of the asset might not be recovered. There were no impairments during fiscal 2023, 2022, or 2021. Impairment of Long Lived Assets Our long-lived assets consist of property and equipment and right-of-use assets from leases. Property and equipment includes leasehold improvements, and other tangible assets. Long-lived assets are reviewed for potential impairment at such time that events or changes in circumstances indicate that the carrying amount of an asset might not be recovered. We evaluate for impairment at the individual showroom level, which is the lowest level at which individual cash flows can be identified. When evaluating long-lived assets for potential impairment, we will first compare the carrying amount of the assets to the future undiscounted cash flows for the respective long-lived asset. If the estimated future cash flows are less than the carrying amounts of the assets, an impairment loss is measured as the excess of the carrying value over its fair value. We estimate fair value based on future discounted cash flow based on our historical operations of the showroom and estimates of future showroom profitability and economic conditions. These estimates include factors such as sales growth, gross margin, employment costs, lease escalation, and overall macroeconomic conditions, and are therefore subject to variability. Actual future results may differ from those estimates. If required, an impairment loss is recorded for that portion of the assets' carrying value in excess of fair value. In fiscal 2023, the Company did not recognize any impairment charges associated with showroom-level right of use lease assets. Durin g fiscals 2022 and 2021, the Company recorded impairment charges of $0.6 million and $0.2 million, respectively, associated with the assets of an underperforming retail locations. The impairments were recorded in selling, general and administrative in the Company’s Statements of Operations. Product Warranty Depending on the type of merchandise, the Company offers either a three-year limited warranty or a lifetime warranty. The Company’s warranties require it to repair or replace defective products at no cost to the customer. At the time product revenue is recognized, the Company reserves for estimated future costs that may be incurred under its warranties based on historical experience. The Company periodically reviews the adequacy of its recorded warranty liability. Product warranty expense, without any reserve adjustments, was approximately $0.7 million, $0.5 million, and $0.7 million in fiscal 2023, 2022, and 2021. The increase in fiscal 2023 is related to an increase in warranty claims related to an increase in net sales. Warranty reserve was $0.7 million as of January 29, 2023 and January 30, 2022. Leases The Company adopted Accounting Standards Update (ASU) No.2016-02, Leases (ASC 842) during fiscal 2022. The Company leases its office, warehouse facilities and retail showrooms under operating lease agreements which expire at various dates through January 2034. Leases with an initial term of twelve months or less are not recorded on the balance sheet and are expensed on a straight-line basis over the lease term in the Statements of Operations. The Company determines if a contract contains a lease at inception based on our right to control the use of an identified asset and our right to obtain substantially all of the economic benefits from the use of that identified asset. Operating right-of-use assets represents the right to use an underlying asset pursuant to the lease for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease, both of which are recognized based on the present value of future minimum lease payments over the lease term at the commencement date, Certain adjustments to the right-of-use asset may be required for items such as initial direct costs paid or incentives received. We combine lease and non-lease components for our showroom real estate leases in determining the lease payments subject to the initial present value calculation. The lease payments are discounted at the Company's incremental borrowing rate as the implicit rate in the lease is not readily determinable for most of the Company's leases, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. We determine incremental borrowing rates as of the first day of each fiscal year and analyze changes in interest rates and the Company's credit profile to determine if the rates need to be updated during the fiscal year. We recognize operating lease cost over the estimated term of the lease, which includes options to extend lease terms that are reasonably certain of being exercised, starting when possession of the property is taken from the landlord, which normally includes a construction period prior to the showroom opening. When a lease contains a predetermined fixed escalation of the fixed rent, we recognize the related operating lease cost on a straight-line basis over the lease term. In addition, certain of our lease agreements include variable lease payments, such as payments based on a percentage of net sales that are in excess of a predetermined level and/or increases based on a change in the consumer price index or fair market value. These variable lease payments are excluded from minimum lease payments and are included in the determination of net lease cost when it is probable that the expense has been incurred and the amount can be reasonably estimated. If an operating lease asset is impaired, the remaining operating lease asset will be amortized on a straight-line basis over the remaining lease term. Fair Value Measurements The carrying amount of the Company’s financial instruments classified as current assets and current liabilities approximate fair values based on the short-term nature of the accounts. Selling, General and Administrative Expenses Selling, general and administrative expenses include all operating costs, other than advertising and marketing expense, not included in cost of merchandise sold. These expenses include all payroll and payroll-related expenses; showroom expenses, including occupancy costs related to showroom operations, such as rent and common area maintenance; occupancy and expenses related to many of our operations at our headquarters, including utilities, equity based compensation, financing related expenses and public company expenses; and credit card transaction fees. Selling, general and administrative expenses as a percentage of net sales is usually higher in lower volume quarters and lower in higher volume quarters because a significant portion of the costs are relatively fixed. Employee Benefit Plan In February 2017, the Company established the The Lovesac Company 401(k) Plan (the “401(k) Plan”) with elective deferrals beginning May 1, 2017. The 401(k) Plan calls for elective deferral contributions, safe harbor matching contributions and profit sharing contributions. All employees of the Company will be eligible to participate in the 401(k) Plan in the month following one (1) month of service and the employee is over age 21. Participants are able to contribute up to 100% of their eligible compensation to the 401(k) Plan subject to limitations with the IRS. Employer contributions to the 401(k) Plan for fiscal 2023, fiscal 2022, and fiscal 2021 were approximately $1.3 million, $0.8 million, and $0.5 million, respectively. Advertising and Marketing Expenses Advertising and marketing expense include digital, social, and traditional advertising and marketing initiatives, that cover all of our business channels. All advertising costs are expensed as incurred, or upon the release of the initial advertisement. Total advertising expenses were $79.9 million, $65.1 million, and $41.9 million in fiscal 2023, fiscal 2022, and fiscal 2021, respectively. Showroom Preopening and Closing Costs Non-capital expenditures incurred in preparation for opening new retail showrooms are expensed as incurred and included in selling, general and administrative expenses. The Company continually evaluates the profitability of its showrooms. When the Company closes or relocates a showroom, the Company incurs unrecoverable costs, including the net book value of abandoned fixtures and leasehold improvements, lease termination payments, costs to transfer inventory and usable fixtures and other costs of vacating the leased location. Such costs are expensed as incurred and are included in selling, general and administrative expenses. Equity-Based Compensation The Company adopted the 2017 Equity Plan which provides for awards in the form of options, stock appreciation rights, restricted stock awards, restricted stock units, performance shares, performance units, cash-based awards and other stock-based awards. All awards shall be granted within 10 years from the effective date of the 2017 Equity Plan. Vesting is typically over a three The fair value of the restricted stock units is determined based on the closing price of the Company's common stock on the grant date and the expense is recognized over the service period. For performance based restricted stock units, the number of units received will depend on the achievement of financial metrics relative to the approved performance targets. For performance based restricted stock units, stock-based compensation expense is recognized based on expected achievement of performance targets. The Company recognizes forfeitures as they occur. Income Taxes The Company accounts for uncertainty in income taxes using a two-step approach to recognize and measure uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. The Company classifies the liability for unrecognized tax benefits as current to the extent that the Company anticipates payment (or receipt) of cash within one year. Interest and penalties related to uncertain tax positions are recognized in the provision for income taxes. Deferred income taxes are provided on temporary differences between the income tax basis of assets and liabilities and the amounts reported in the financial statements and on net operating loss and tax credit carry forwards. A valuation allowance is provided for that portion of deferred income tax assets not likely to be realized. Deferred income tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. Basic and Diluted Net Income (Loss) Per Common Share Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and common stock equivalents outstanding during the period. Diluted net income (loss) per common share includes, in periods in which they are dilutive, the effect of those potentially dilutive securities where the average market price of the common stock exceeds the exercise prices for the respective periods. In fiscal 2023, the effects of 640,256 unvested restricted stock units, and 281,750 common stock warrants were included in the diluted share calculation. The effects of 495,366 stock options were excluded in the diluted net income per common share calculation because the effects of including theses potentially dilutive shares was antidilutive. In fiscal 2022, the effects of 533,333 unvested restricted stock units, 495,366 stock options and 281,750 common stock warrants were included in the diluted share calculation. In fiscal 2021, the effects of 655,558 unvested restricted stock units and 293,973 common stock warrants were included in the diluted share calculation. The effects of 495,366 stock were excluded in the diluted net loss per common share calculation as the effects of including theses potentially dilutive shares was antidilutive. Recent Accounting Pronouncements |
Property and Equipment, net
Property and Equipment, net | 12 Months Ended |
Jan. 29, 2023 | |
Property, Plant and Equipment, Net [Abstract] | |
Property and Equipment, net | Property and equipment as of January 29, 2023 and January 30, 2022 consists of (in thousands): Estimated Life 2023 2022 Office and store furniture, and equipment 5 Years $ 8,933 $ 6,497 Software 3 Years 3,996 3,625 Leasehold improvements Shorter of estimated useful life or lease term 60,964 40,788 Computers 3 Years 4,032 2,138 Tools, Dies, Molds 5 Years 868 764 Vehicles 5 Years 497 497 Construction in process NA 6,329 2,765 Total 85,619 57,074 Accumulated depreciation and amortization (32,715) (22,937) Property and equipment, net $ 52,904 $ 34,137 |
Intangible Assets, net
Intangible Assets, net | 12 Months Ended |
Jan. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible assets, net | A summary of other intangible assets follows (in thousands): January 29, 2023 Weighted-Average Remaining Life (in years) Gross Carrying Amount Accumulated Amortization Net carrying amount Patents 7.6 $ 3,091 $ (1,864) $ 1,227 Trademarks 2.2 1,522 (1,338) 184 Other intangibles — 840 (840) — Total $ 5,453 $ (4,042) $ 1,411 January 30, 2022 Weighted-Average Remaining Life (in years) Gross Carrying Amount Accumulated Amortization Net carrying amount Patents 8.1 $ 2,838 $ (1,626) $ 1,212 Trademarks 2.2 1,390 (1,189) 201 Other intangibles — 840 (840) — Total $ 5,068 $ (3,655) $ 1,413 Amortization expense was $0.4 million, $0.7 million, and $0.5 million in fiscal 2023, 2022, and 2021, respectively. Expected amortization expense by fiscal year for these other intangible assets follows (in thousands): 2024 $ 356 2025 299 2026 225 2027 178 2028 139 Thereafter 214 $ 1,411 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Jan. 29, 2023 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Prepaid Expenses and Other Current Assets | A summary of other prepaid and other current assets follows (in thousands): 2023 2022 Tenant allowance receivable $ 6,160 $ 2,781 Barter credits 3,770 3,407 Rebate receivable 2,780 226 Prepaid insurance 2,009 1,667 Prepaid catalog costs and related 1,557 4,794 Prepaid taxes 1,000 — Prepaid software licenses 945 790 Deposits 662 421 Prepaid rent 505 62 Prepaid inventory 49 475 Other 1,640 1,103 $ 21,077 $ 15,726 |
Accrued Expenses
Accrued Expenses | 12 Months Ended |
Jan. 29, 2023 | |
Payables and Accruals [Abstract] | |
ACCRUED EXPENSES | A summary of accrued expenses follows (in thousands): 2023 2022 Accrued warehouse expenses $ 5,625 $ 2,671 Customer return liability 4,483 2,026 Accrued professional fees 2,167 2,268 Accrued freight and shipping 2,131 23,683 Accrued occupancy 1,278 1,284 Accrued state income taxes 1,187 1,007 Accrued insurance 1,026 973 Accrued credit card fees 770 542 Accrued advertising fees 739 4,150 Warranty liability 721 689 Other accrued expenses 3,265 1,204 $ 23,392 $ 40,497 |
Income Taxes
Income Taxes | 12 Months Ended |
Jan. 29, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | The Company is subject to federal, state and local corporate income taxes. The components of the provision for income taxes reflected on the statements of operations are set forth below: 2023 2022 2021 Current taxes: U.S. federal $ 6,990 $ — $ — State and local 3,252 2,198 86 Total current tax expense $ 10,242 $ 2,198 $ 86 Deferred taxes: U.S. federal $ 1,322 $ (7,254) $ — State and local (906) (2,582) — Total deferred tax expense (benefit) 416 (9,836) — Total tax provision $ 10,658 $ (7,638) $ 86 A reconciliation of income taxes at the federal statutory corporate rate to the effective rate is as follows: 2023 2022 2021 Provision (benefit) at federal Statutory rates 21.0 % 21.0 % 21.0 % State tax, net of federal provision (benefit) 4.3 % 4.9 % 3.3 % Non-deductible executive compensation 1.7 % 1.9 % — % Permanent adjustments 0.2 % — % 0.1 % Equity-based compensation 0.1 % (4.7) % (2.8) % Federal true-ups 0.1 % (0.4) % 0.4 % Change in valuation allowance — % (42.7) % (21.4) % Income tax provision 27.4 % (20.0) % 0.6 % Significant components of the Company's deferred tax assets are as follows (in thousands): 2023 2022 Deferred Income Tax Assets Federal net operating loss carryforward $ — $ 2,082 State net operating loss carryforward 595 1,403 Intangible assets 403 397 Accrued liabilities 2,952 3,243 Equity-based compensation 3,247 2,032 Merchandise inventories 726 689 Charitable Contributions — 12 R&D Capitalization 1,920 — Operating Lease Liabilities 40,814 29,129 Total Deferred Income Tax Assets 50,657 38,987 Deferred Income Tax Liabilities Operating Lease Right of Use Asset (36,224) (26,726) Property and equipment (5,013) (2,425) Total Deferred Tax Liabilities (41,237) (29,151) Net Deferred Income Tax Asset $ 9,420 $ 9,836 At January 29, 2023, the Company did not have any net operating loss carryforwards available for federal income tax purposes. At January 30, 2022, the Company had net operating loss carryforwards available for federal income tax purposes of approximately $9.9 million. In addition, the Company has approximately $9.4 million and $22.2 million of state net operating loss carryforwards as of January 29, 2023 and January 30, 2022, respectively. The state net operating losses expire at various times between 2031 and 2040. The statute of limitations has expired for all tax years prior to 2019 for federal and state tax purposes. However, the net operating losses generated on the Company's federal and state tax returns in prior years may be subject to adjustments by the federal and state tax authorities. Prior to the fiscal 2022 year-end, the Company recorded a full valuation allowance on its net deferred tax assets, as it did not meet the more likely than not threshold required under ASC 740-10-30. For the year ended January 30, 2022, the Company reversed its full valuation allowance of $16.4 million, as it assessed and concluded that it met the more likely than not threshold of realizing its net deferred tax assets. The main forms of positive evidence to support the valuation allowance release were the substantial realization of its net operating loss carryforwards and cumulative three years of income. As of January 29, 2023, the Company did not record a valuation allowance against its net deferred tax assets, due to its assessment and conclusion that it is more likely than not that it would realize its net deferred tax assets. As of January 29, 2023 and January 30, 2022, the Company assessed and concluded that it does not have any unrecognized tax benefits. The Company does not anticipate any material adjustments relating to unrecognized tax benefits within the next twelve months; however, the ultimate outcome of tax matters is uncertain and unforeseen results can occur. We had no interest or penalties during fiscal years 2023, 2022, and 2021, and we do not anticipate any such items during the next twelve months. Our policy is to record interest and penalties directly related to uncertain tax positions as income tax expense in the statements of operations. The IRS is auditing the Company's fiscal 2019 federal income tax return. The Company has been responding to information requests and at this time, the Internal Revenue Service (IRS) has not proposed any adjustments. On August 16, 2022, the Inflation Reduction Act was signed into law. The Inflation Reduction Act includes various tax provisions, which are effective for tax years beginning on or after January 1, 2023. The Company assessed and concluded that the Inflation Reduction Act did not have an impact to the financials as of January 29, 2023, and will continue to monitor the impact of the changes. |
Leases
Leases | 12 Months Ended |
Jan. 29, 2023 | |
Leases [Abstract] | |
Lessee, Operating Leases | Leases During fiscal 2022, the Company adopted ASC No. 2016-02, Leases (Topic 842). Components of lease expense were as follows (in thousands): 2023 2022 Operating lease expense $ 24,173 $ 18,902 Variable lease expense 16,207 12,439 Short term lease expense 721 336 Total lease expense $ 41,101 $ 31,677 Variable lease expense includes index-based changes in rent, maintenance, real estate taxes, insurance and other variable charges included in the lease as well as rental expenses related to short term leases. The Company’s weighted average lease term and weighted average discount rates are as follows: For the year ended 2023 2022 Weighted average remaining lease term (in years) Operating Leases 7.4 6.29 Weighted average discount rate Operating Leases 4.10 % 3.44 % During the fiscal year ended January 29, 2023, we did not recognize any impairment charges associated with showroom-level right-of-use assets. During the fiscal year ended January 30, 2022, we recognized impairment charges totaling $0.6 million associated with showroom-level ROU assets that were included as part of selling, general and administrative expenses. We did not recognize any impairment charges with showroom-level right-of-use assets during the fiscal year ended January 31, 2021 as we did not adopt ASC 842 until fiscal year 2022. Future minimum lease payments under non-cancelable leases as of January 29, 2023 were as follows (in thousands): 2024 $ 27,671 2025 26,759 2026 24,447 2027 22,083 2028 19,747 Thereafter 62,832 Total undiscounted future minimum lease payments 183,539 Less: imputed interest (25,686) Total present value of lease obligations 157,853 Less: current operating lease liability (21,898) Operating lease liability- long term $ 135,955 Supplemental cash flow information and non-cash activity related to our operating leases is as follows (in thousands): 2023 2022 Operating cash flow information: Cash paid for operating lease liabilities $ 23,724 $ 14,400 Non-cash activities Net additions to right-of-use assets obtained in exchange for lease obligations $ 56,099 $ 116,048 |
Commitments, Contingencies and
Commitments, Contingencies and Related Parties | 12 Months Ended |
Jan. 29, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS, CONTINGENCIES AND RELATED PARTIES | Commitments, Contingencies and Related Parties Legal Contingency The Company is involved in various legal proceedings in the ordinary course of business. Where appropriate, the Company has made accruals with respect to these matters, however, for cases where liability is not probable or the amount cannot be reasonably estimated, accruals have not been made. Management cannot presently predict the outcome of these matters, although management believes, based in part on the advice of counsel, that the ultimate resolution of these matters will not have a materially adverse effect on the Company’s financial position, results of operations or cash flows. The Company received management services from Mistral Capital Management, LLC (“Mistral”) under a contractual agreement that ended on January 31, 2021. One of our directors is a member and principal of Mistral. There were no management fees incurred in fiscal 2023 or fiscal 2022, and management fees totaled approximately $0.4 million in fiscal 2021, and are included in selling, general and administrative expenses. There were no amounts payable to Mistral as of January 29, 2023 or January 30, 2022. There were less than $0.1 million in amounts payable to Mistral as of January 31, 2021. The Company also received management services from Satori Capital, LLC (“Satori”) under a contractual agreement that ended on January 31, 2021. One of our directors is a partner at Satori. There were no management fees incurred in fiscal 2023 or fiscal 2022 and management fees totaled approximately $0.1 millions in fiscal 2021 and are included in selling, general and administrative expenses. There were no amounts payable to Satori as of January 29, 2023 or January 30, 2022. Amounts payable to Satori as of January 31, 2021 were less than $0.1 million consisting of management fees which were included in accounts payable in the accompanying balance sheet as of January 31, 2021. The Company engaged Blueport Commerce (“Blueport”), a company owned in part by investment vehicles affiliated with Mistral, as an ecommerce platform in February 2018. The Company terminated the Blueport contract in fiscal 2021 in order to launch a new enhanced ecommerce platform. There were no fees incurred in fiscal 2023 or 2022. There was $2.1 million of fees incurred with Blueport for sales transacted through the platform and an early termination fee of $0.7 million during fiscal 2021. There were no amounts payable as of January 29, 2023, January 30, 2022, or January 31, 2021. Recovery of Insurance Proceeds |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Jan. 29, 2023 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | Stockholders' Equity Common Stock Warrants On June 29, 2018, the Company issued 281,750 warrants with a five-year term to Roth Capital Partners, LLC as part of the underwriting agreement in connection with the Company's IPO. The warrants remain outstanding as of January 29, 2023. Warrants may be exercised on a cashless basis, where the holders receive fewer shares of common stock in lieu of a cash payment to the Company. In fiscal 2023, there were no exercises of warrants. In fiscal 2022, 5,625 warrants were exercised, which resulted in the issuance of 10,956 common shares. There were 98 warrants that expired as of January 30, 2022. In fiscal 2021, 738,897 warrants were exercised on a cashless basis and resulted in the issuance of 439,447 common shares. The following represents warrant activity during fiscal 2023, 2022, and 2021: Average exercise price Number of warrants Weighted average remaining contractual life (in years) Outstanding at February 2, 2020 16.83 1,039,120 1.93 Warrants issued — — — Expired and canceled — — — Exercised 16.00 (745,147) 0.41 Outstanding at January 31, 2021 19.07 293,973 2.57 Warrants issued — — — Expired and canceled 9.83 (98) — Exercised 16.00 (12,125) 0.09 Outstanding at January 30, 2022 19.20 281,750 1.41 Warrants issued — — — Expired and canceled — — — Exercised — — — Outstanding at January 29, 2023 $ 19.20 281,750 0.41 Equity Incentive Plans The Company adopted the 2017 Equity Plan which provides for awards in the form of options, stock appreciation rights, restricted stock awards, restricted stock units, performance shares, performance units, cash-based awards and other stock-based awards. All awards shall be granted within 10 years from the effective date of the 2017 Equity Plan. In June 2020, the stockholders of the Company approved an amendment to the 2017 Equity Plan that increased the number of shares of common stock reserved for issuance under the 2017 Equity Plan by 690,000 shares of common stock. The number of shares of common stock reserved for issuance under the 2017 Equity Plan increased from 1,414,889 to 2,104,889 shares of common stock. In fiscal 2023, the 2017 Equity Plan was amended and restated to, among other things, increase the shares of our common stock authorized and reserved for issuance by 550,000 shares, which increased the number of shares of common stock reserved for issuance under the 2017 Equity Plan to 2,654,889 shares of common stock. Stock Options In June 2019, the Company granted 495,366 nonstatutory stock options to certain officers of the Company with an option price of $38.10 per share. 100% of the stock options are subject to vesting on the third anniversary of the date of grant if the officers are still employed by the Company and the average closing price of the Company’s common stock for the prior 40 consecutive trading days has been at least $75 by the third anniversary of the grant. Both the employment and the market condition were required to be satisfied no later than June 5, 2022 or the options would terminate. These options were valued using a Monte Carlo simulation model to account for the path dependent market conditions that stipulate when and whether or not the options shall vest. The stock options were modified to extend the term of the options through June 5, 2024. This resulted in additional compensation of approximately $0.9 million, of which, $0.3 million was recorded upon modification and the remaining expense was recognized over the remaining expected term. The market condition was met on June 5, 2021, which was the date on which the average closing price of the Company’s common stock had been at least $75 for 40 consecutive trading days. As a result of the market condition being met, the Company accelerated the amortization and recognized additional stock-based compensation expense during fiscal year 2022 of approximately $0.9 million. The awards vested and became exercisable on June 5, 2022. The following summarizes the activity of our stock options as of January 29, 2023, January 30, 2022, and January 31, 2021 and the changes during fiscal years then ended (in thousands, except share and per share amounts) : Number of options Weighted average exercise price Weighted average remaining contractual life (in years) Aggregate intrinsic value Outstanding at February 2, 2020 495,366 $ 38.10 2.34 $ — Granted — — Canceled and forfeited — — Outstanding at January 31, 2021 495,366 38.10 3.35 9,135 Granted — — Canceled and forfeited — — Outstanding at January 30, 2022 495,366 38.10 2.35 6,162 Granted — — Canceled and forfeited — — Outstanding and exercisable at January 29, 2023 495,366 $ 38.10 1.35 $ — Restricted Stock Units The following table summarizes the activity for the Company's unvested restricted stock units as of January 29, 2023, January 30, 2022, January 31, 2021, and changes during fiscal years then ended, is presented below: Number of shares Weighted average grant date fair value Unvested at February 2, 2020 183,053 $ 21.34 Granted 627,940 16.94 Forfeited (5,701) 11.86 Vested (149,734) 16.24 Unvested at January 31, 2021 655,558 18.86 Granted 94,985 78.53 Forfeited (42,516) 22.67 Vested (174,694) 19.57 Unvested at January 30, 2022 533,333 28.41 Granted 289,625 44.20 Forfeited (62,186) 29.09 Vested (120,516) 36.03 Unvested at January 29, 2023 640,256 $ 34.50 Equity-based compensation expense was approximately $10.5 million, $5.9 million, and $4.7 million for fiscal 2023, 2022, and 2021 respectively. In fiscal 2023, The Company recognized $4.3 million related to performance stock units granted in fiscal 2021 with a three year term, which met the performance target of $550 million in net sales and $50 million in Adjusted EBITDA for fiscal 2023. The total unrecognized equity based compensation cost related to unvested restricted stock unit awards was approximately $4.2 million as of January 29, 2023 and will be recognized in operations over a weighted average period of 1.95 years. |
Financing Arrangements
Financing Arrangements | 12 Months Ended |
Jan. 29, 2023 | |
Line of Credit Facility [Abstract] | |
FINANCING ARRANGEMENTS | Financing Arrangements Credit Line On February 6, 2018, the Company established a line of credit with Wells Fargo Bank. The line of credit allowed the Company to borrow up to $25.0 million and matured on February 2023. As of January 30, 2022, the Company’s borrowing availability under the line of credit was $22.5 million, and there were no borrowings outstanding on this line of credit. On March 25, 2022, the Company amended the credit agreement to extend the maturity date to March 25, 2024, and among other things, increase the maximum revolver commitment to $40.0 million, subject to borrowing base and availability restrictions. Availability is based on eligible accounts receivable and inventory. The amended agreement contains a financial covenant that requires us to maintain undrawn availability under the credit facility of at least 10% of the lesser of (i) the aggregate commitments in the amount of $40.0 million and (ii) the amounts available under the credit facility based on eligible accounts receivable and inventory. |
Segment Information
Segment Information | 12 Months Ended |
Jan. 29, 2023 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | Segment Information Segments are reflective of how the chief operating decision maker ("CODM") reviews operating results for the purpose of allocating resources and assessing performance. The CODM group of the Company are the Chief Executive Officer and the President and Chief Operating Officer. The Company's operating segments are the sales channels, which share similar economic and other qualitative characteristics, and are aggregated together as one reportable segment. The Company’s sales by product which are considered one segment are as follows: 2023 2022 2021 Sactionals $ 584,815 $ 436,588 $ 271,018 Sacs 55,145 52,478 44,975 Other 11,585 9,173 4,745 Total net sales $ 651,545 $ 498,239 $ 320,738 |
Basis of Presentation, and Summ
Basis of Presentation, and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of PresentationThe financial statements of the Company as of January 29, 2023 and January 30, 2022 and for the years ended January 29, 2023, January 30, 2022 and January 31, 2021 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission. |
Fiscal Year | Fiscal YearThe Company’s fiscal year is determined on a 52/53 week basis ending on the Sunday closest to February 1. Hereinafter, fiscal years ended January 29, 2023, January 30, 2022 and January 31, 2021 are referred to as fiscal 2023, 2022 and 2021, respectively. Fiscal 2023, 2022 and 2021 were 52-week fiscal years. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. The Company evaluates its estimates and judgements on an ongoing basis based on historical experience, expectations of future events and various other factors we believe to be reasonable under the circumstances and revise them when necessary in the period the change is determined. Actual results may differ from the original or revised estimates. |
Revenue Recognition | Revenue Recognition Our revenue consists substantially of product sales. The Company reports product sales net of discounts and recognized at a point in time when control transfers to the customer, which occurs when products are shipped. The Company excludes from the measurement of the transaction price all taxes assessed by governmental authorities collected from a customer, including sales, use, excise, value-added, and franchise taxes (collectively referred to as sales taxes). The Company applies the practical expedient for contracts with duration of one year or less and therefore does not consider the effects of the time value of money. Shipping and handling charges billed to customers are included in revenue. The Company recognizes shipping and handling expense as fulfillment activities (rather than a promised good or service) when the activities are performed. Accordingly, the Company records the expenses for shipping and handling activities at the same time the Company recognizes revenue. Shipping and handling costs incurred are included in cost of merchandise sold and include inbound freight and tariff costs relative to inventory sold, warehousing, and last mile shipping to our customers. Shipping and handling costs were $158.0 million in fiscal 2023, $112.8 million in fiscal 2022, and $63.1 million in fiscal 2021. Estimated refunds for returns are recorded using our historical return patterns, adjusting for any changes in returns policies and current product performance. The Company records estimated refunds for net sales returns on a monthly basis as a reduction of net sales and cost of sales on the statement of operations and an increase in inventory and customers return liability on the balance sheet. As of January 29, 2023 and January 30, 2022, we recorded a return liability of $4.5 million and $2.0 million within accrued expenses, and a corresponding asset for the net realizable value of inventory to be returned for $1.0 million and $0.4 million, respectively, in merchandise inventories on our Balance Sheet. In some cases, deposits are received before the Company transfers control, resulting in the recognition of contract liabilities, reported as customer deposits on our Balance Sheet. As of January 29, 2023, and January 30, 2022, the Company recorded customer deposit liabilities the amount of $6.8 million and $13.3 million, respectively. During the years ended January 29, 2023, and January 30, 2022, the Company recognized $13.3 million and $6.0 million related to customer deposits from fiscal 2022 and 2021. |
Barter Arrangements | Barter ArrangementsThe Company has a bartering arrangement with a third-party vendor. The Company repurposes returned open-box inventory in exchange for media credits, which are being used to support our advertising initiatives to create brand awareness and drive net sales growth. Barter transactions with commercial substance are recorded at a transaction price based on the estimated fair value of the non-cash consideration of the media credits to be received and the revenue is recognized when control of inventory is transferred, which is when the inventory is picked up in our warehouse. Fair value is estimated using various considerations, including the cost of similar media advertising if transacted directly, the expected sales price of product given up in exchange for the media credits, and the expected usage of media credits prior to expiration based on a marketing spend forecast. The Company recognizes an asset for media credits which is subsequently evaluated for impairment at each reporting period for any changes in circumstances. As the barter credits are expected to be utilized at various dates through their expiration dates, the Company will classify the amount expected to be utilized in the next fiscal year as current, which is included in Prepaid and Other Current Assets, with the remaining balance included as part of Other Assets on the balance sheet. |
Cash and Cash Equivalents | Cash and Cash Equivalents The Company considers all highly liquid investments with a maturity at purchase of three months or less to be cash equivalents. The Company has deposits with financial institutions that maintain Federal Deposit Insurance Corporation “FDIC” deposit insurance up to $250,000 per depositor. The portion of the deposit in excess of this limit represents a credit risk to the Company. Due to the high cash balance maintained by the Company, the Company does maintain depository balances in excess of the insured amounts. |
Trade Accounts Receivable, net | Trade Accounts Receivable, net Trade accounts receivable are stated at their estimated realizable amount and do not bear interest for which collectability is reasonably assured. Management determines the allowance for doubtful accounts by regularly evaluating individual customer accounts, considering the customer’s financial condition, and credit history, and general and industry current economic conditions. Trade accounts receivables are evaluated for collectability on a regular basis and an allowance is recorded, if necessary. Recoveries of amounts previously written off are recorded when received. Historically, collection losses have been immaterial as a significant portion of the Company’s receivables are related to individual credit card transactions and two wholesale customers. The Company recognized $0.4 million related to bad debt write-offs for fiscal 2023, and 2022, and recognized $0.8 million for fiscal 2021, respectively. |
Prepaid Expenses and Other Current Assets | Prepaid Expenses and Other Current Assets The Company recognizes payments made for goods and services to be received in the near future as prepaid expenses and other current assets. Prepaid expenses and other current assets consist primarily of payments related to insurance premiums, deposits, prepaid rent, prepaid inventory, and other costs. |
Merchandise Inventories, net | Merchandise Inventories, net Merchandise inventories are comprised of finished goods which are carried at the lower of cost or net realizable value. Cost is determined on a weighted-average method basis. Merchandise inventories consist primarily of foam filled furniture, sectional couches, and related accessories. The Company adjusts its inventory for obsolescence based on historical trends, aging reports, specific identification and its estimates of future retail sales prices. In addition, the Company includes capitalized freight and warehousing costs in inventory relative to the finished goods in inventory. |
Gift Certificates and Merchandise Credits | Gift Certificates and Merchandise Credits The Company sells gift certificates and issues merchandise credits to its customers in the showrooms and through its website. Revenue associated with gift certificates and merchandise credits is deferred until redemption of the gift certificate |
Property and Equipment, net | Property and Equipment, net Property and equipment are stated at cost less accumulated depreciation and amortization. Office and showroom furniture and equipment, software and vehicles are depreciated using the straight-line method over their estimated useful lives. Leasehold improvements are amortized using the straight-line method over their expected useful lives or lease term, whichever is shorter. Expenditures for repairs and maintenance are charged to expense as incurred. For assets sold or otherwise disposed of, the cost and related accumulated depreciation or amortization is removed from the accounts, and any resulting gain or loss is reflected in operations for the period. The disposals generally relate to the decommissioning of aged assets, remodeled showrooms, and fixtures used during pop-up-shops. Expenditures for major betterments that extend the useful lives of property and equipment are capitalized. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of the identified net assets of each business acquired. Goodwill and other indefinite-lived intangible assets are tested annually for impairment in the fourth fiscal quarter and in interim periods if certain events occur indicating that the carrying amounts may be impaired. If a qualitative assessment is used and the Company determines that the fair value of a reporting unit or indefinite-lived intangible asset is more likely than not (i.e., a likelihood of more than 50%) less than its carrying amount, a quantitative impairment test will be performed. If goodwill is quantitatively assessed for impairment, a two-step approach is applied. There were no impairments during fiscal 2023, 2022, or 2021. |
Intangible Assets, net | Intangible Assets, net Intangible assets with finite useful lives, including patents, trademarks, and other intangible assets are being amortized on a straight-line basis over their estimated lives of 10 years, 3 years, and 5 years, respectively. Intangible assets with finite useful lives are reviewed for impairment whenever events or circumstances indicate that the carrying amount of the asset might not be recovered. There were no impairments during fiscal 2023, 2022, or 2021. |
Impairment of Long Lived Assets | Impairment of Long Lived Assets Our long-lived assets consist of property and equipment and right-of-use assets from leases. Property and equipment includes leasehold improvements, and other tangible assets. Long-lived assets are reviewed for potential impairment at such time that events or changes in circumstances indicate that the carrying amount of an asset might not be recovered. We evaluate for impairment at the individual showroom level, which is the lowest level at which individual cash flows can be identified. When evaluating long-lived assets for potential impairment, we will first compare the carrying amount of the assets to the future undiscounted cash flows for the respective long-lived asset. If the estimated future cash flows are less than the carrying amounts of the assets, an impairment loss is measured as the excess of the carrying value over its fair value. We estimate fair value based on future discounted cash flow based on our historical operations of the showroom and estimates of future showroom profitability and economic conditions. These estimates include factors such as sales growth, gross margin, employment costs, lease escalation, and overall macroeconomic conditions, and are therefore subject to variability. Actual future results may differ from those estimates. If required, an impairment loss is recorded for that portion of the assets' carrying value in excess of fair value. In fiscal 2023, the Company did not recognize any impairment charges associated with showroom-level right of use lease assets. Durin g fiscals 2022 and 2021, the Company recorded impairment charges of $0.6 million and $0.2 million, respectively, associated with the assets of an underperforming retail locations. The impairments were recorded in selling, general and administrative in the Company’s Statements of Operations. |
Product Warranty | Product Warranty Depending on the type of merchandise, the Company offers either a three-year limited warranty or a lifetime warranty. The Company’s warranties require it to repair or replace defective products at no cost to the customer. At the time product revenue is recognized, the Company reserves for estimated future costs that may be incurred under its warranties based on historical experience. The Company periodically reviews the adequacy of its recorded warranty liability. Product warranty expense, without any reserve adjustments, was approximately $0.7 million, $0.5 million, and $0.7 million in fiscal 2023, 2022, and 2021. The increase in fiscal 2023 is related to an increase in warranty claims related to an increase in net sales. Warranty reserve was $0.7 million as of January 29, 2023 and January 30, 2022. |
Leases | Leases The Company adopted Accounting Standards Update (ASU) No.2016-02, Leases (ASC 842) during fiscal 2022. The Company leases its office, warehouse facilities and retail showrooms under operating lease agreements which expire at various dates through January 2034. Leases with an initial term of twelve months or less are not recorded on the balance sheet and are expensed on a straight-line basis over the lease term in the Statements of Operations. The Company determines if a contract contains a lease at inception based on our right to control the use of an identified asset and our right to obtain substantially all of the economic benefits from the use of that identified asset. Operating right-of-use assets represents the right to use an underlying asset pursuant to the lease for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease, both of which are recognized based on the present value of future minimum lease payments over the lease term at the commencement date, Certain adjustments to the right-of-use asset may be required for items such as initial direct costs paid or incentives received. We combine lease and non-lease components for our showroom real estate leases in determining the lease payments subject to the initial present value calculation. The lease payments are discounted at the Company's incremental borrowing rate as the implicit rate in the lease is not readily determinable for most of the Company's leases, which is the rate incurred to borrow on a collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. We determine incremental borrowing rates as of the first day of each fiscal year and analyze changes in interest rates and the Company's credit profile to determine if the rates need to be updated during the fiscal year. We recognize operating lease cost over the estimated term of the lease, which includes options to extend lease terms that are reasonably certain of being exercised, starting when possession of the property is taken from the landlord, which normally includes a construction period prior to the showroom opening. When a lease contains a predetermined fixed escalation of the fixed rent, we recognize the related operating lease cost on a straight-line basis over the lease term. In addition, certain of our lease agreements include variable lease payments, such as payments based on a percentage of net sales that are in excess of a predetermined level and/or increases based on a change in the consumer price index or fair market value. These variable lease payments are excluded from minimum lease payments and are included in the determination of net lease cost when it is probable that the expense has been incurred and the amount can be reasonably estimated. If an operating lease asset is impaired, the remaining operating lease asset will be amortized on a straight-line basis over the remaining lease term. |
Fair Value Measurements | Fair Value Measurements The carrying amount of the Company’s financial instruments classified as current assets and current liabilities approximate fair values based on the short-term nature of the accounts. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses Selling, general and administrative expenses include all operating costs, other than advertising and marketing expense, not included in cost of merchandise sold. These expenses include all payroll and payroll-related expenses; showroom expenses, including occupancy costs related to showroom operations, such as rent and common area maintenance; occupancy and expenses related to many of our operations at our headquarters, including utilities, equity based compensation, financing |
Employee Benefit Plan | Employee Benefit Plan In February 2017, the Company established the The Lovesac Company 401(k) Plan (the “401(k) Plan”) with elective deferrals beginning May 1, 2017. The 401(k) Plan calls for elective deferral contributions, safe harbor matching contributions and profit sharing contributions. All employees of the Company will be eligible to participate in the 401(k) Plan in the month following one (1) month of service and the employee is over age 21. Participants are able to contribute up to 100% of their eligible compensation to the 401(k) Plan subject to limitations with the IRS. Employer contributions to the 401(k) Plan for fiscal 2023, fiscal 2022, and fiscal 2021 were approximately $1.3 million, $0.8 million, and $0.5 million, respectively. |
Advertising and Marketing Expenses | Advertising and Marketing ExpensesAdvertising and marketing expense include digital, social, and traditional advertising and marketing initiatives, that cover all of our business channels. All advertising costs are expensed as incurred, or upon the release of the initial advertisement. Total advertising expenses were $79.9 million, $65.1 million, and $41.9 million in fiscal 2023, fiscal 2022, and fiscal 2021, respectively. |
Showroom Preopening and Closing Costs | Showroom Preopening and Closing Costs Non-capital expenditures incurred in preparation for opening new retail showrooms are expensed as incurred and included in selling, general and administrative expenses. The Company continually evaluates the profitability of its showrooms. When the Company closes or relocates a showroom, the Company incurs unrecoverable costs, including the net book value of abandoned fixtures and leasehold improvements, lease termination payments, costs to transfer inventory and usable fixtures and other costs of vacating the leased location. Such costs are expensed as incurred and are included in selling, general and administrative expenses. |
Equity-Based Compensation | Equity-Based Compensation The Company adopted the 2017 Equity Plan which provides for awards in the form of options, stock appreciation rights, restricted stock awards, restricted stock units, performance shares, performance units, cash-based awards and other stock-based awards. All awards shall be granted within 10 years from the effective date of the 2017 Equity Plan. Vesting is typically over a three The fair value of the restricted stock units is determined based on the closing price of the Company's common stock on the grant date and the expense is recognized over the service period. For performance based restricted stock units, the number of units received will depend on the achievement of financial metrics relative to the approved performance targets. For performance based restricted stock units, stock-based compensation expense is recognized based on expected achievement of performance targets. The Company recognizes forfeitures as they occur. |
Income Taxes | Income Taxes The Company accounts for uncertainty in income taxes using a two-step approach to recognize and measure uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon settlement. The Company classifies the liability for unrecognized tax benefits as current to the extent that the Company anticipates payment (or receipt) of cash within one year. Interest and penalties related to uncertain tax positions are recognized in the provision for income taxes. Deferred income taxes are provided on temporary differences between the income tax basis of assets and liabilities and the amounts reported in the financial statements and on net operating loss and tax credit carry forwards. A valuation allowance is provided for that portion of deferred income tax assets not likely to be realized. Deferred income tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. |
Basic and Diluted Net Income (Loss) Per Common Share | Basic and Diluted Net Income (Loss) Per Common Share Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and common stock equivalents outstanding during the period. Diluted net income (loss) per common share includes, in periods in which they are dilutive, the effect of those potentially dilutive securities where the average market price of the common stock exceeds the exercise prices for the respective periods. In fiscal 2023, the effects of 640,256 unvested restricted stock units, and 281,750 common stock warrants were included in the diluted share calculation. The effects of 495,366 stock options were excluded in the diluted net income per common share calculation because the effects of including theses potentially dilutive shares was antidilutive. In fiscal 2022, the effects of 533,333 unvested restricted stock units, 495,366 stock options and 281,750 common stock warrants were included in the diluted share calculation. In fiscal 2021, the effects of 655,558 unvested restricted stock units and 293,973 common stock warrants were included in the diluted share calculation. The effects of 495,366 stock were excluded in the diluted net loss per common share calculation as the effects of including theses potentially dilutive shares was antidilutive. |
Recent Accounting Pronouncements | Recent Accounting PronouncementsThe Company has considered all recent accounting pronouncements issued by the Financial Accounting Standards Board and they were considered to be not applicable or the adoption of such pronouncements will not have a material impact on the financial statements. |
Basis of Presentation, and Su_2
Basis of Presentation, and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Disaggregation of revenue | The following represents sales disaggregated by channel: (in thousands) 2023 2022 2021 Showrooms $ 398,550 $ 298,989 $ 146,150 Internet 176,519 150,622 151,065 Other 76,476 48,628 23,523 Total net sales $ 651,545 $ 498,239 $ 320,738 |
Schedule of accounts receivable | Breakdown of trade accounts receivable is as follows: (in thousands) As of January 29, 2023 As of January 30, 2022 Credit card receivables $ 5,069 $ 3,186 Wholesale receivables 4,400 5,361 Total trade receivable, net $ 9,469 $ 8,547 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Property, Plant and Equipment, Net [Abstract] | |
Schedule of property and equipment | Property and equipment as of January 29, 2023 and January 30, 2022 consists of (in thousands): Estimated Life 2023 2022 Office and store furniture, and equipment 5 Years $ 8,933 $ 6,497 Software 3 Years 3,996 3,625 Leasehold improvements Shorter of estimated useful life or lease term 60,964 40,788 Computers 3 Years 4,032 2,138 Tools, Dies, Molds 5 Years 868 764 Vehicles 5 Years 497 497 Construction in process NA 6,329 2,765 Total 85,619 57,074 Accumulated depreciation and amortization (32,715) (22,937) Property and equipment, net $ 52,904 $ 34,137 |
Intangible Assets, net (Tables)
Intangible Assets, net (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of other intangible assets | A summary of other intangible assets follows (in thousands): January 29, 2023 Weighted-Average Remaining Life (in years) Gross Carrying Amount Accumulated Amortization Net carrying amount Patents 7.6 $ 3,091 $ (1,864) $ 1,227 Trademarks 2.2 1,522 (1,338) 184 Other intangibles — 840 (840) — Total $ 5,453 $ (4,042) $ 1,411 January 30, 2022 Weighted-Average Remaining Life (in years) Gross Carrying Amount Accumulated Amortization Net carrying amount Patents 8.1 $ 2,838 $ (1,626) $ 1,212 Trademarks 2.2 1,390 (1,189) 201 Other intangibles — 840 (840) — Total $ 5,068 $ (3,655) $ 1,413 |
Schedule of expected amortization expense associated with other intangible assets | Expected amortization expense by fiscal year for these other intangible assets follows (in thousands): 2024 $ 356 2025 299 2026 225 2027 178 2028 139 Thereafter 214 $ 1,411 |
Prepaid Expenses and Other Cu_2
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Prepaid Expense and Other Assets, Current [Abstract] | |
Schedule of other prepaid and other current assets | A summary of other prepaid and other current assets follows (in thousands): 2023 2022 Tenant allowance receivable $ 6,160 $ 2,781 Barter credits 3,770 3,407 Rebate receivable 2,780 226 Prepaid insurance 2,009 1,667 Prepaid catalog costs and related 1,557 4,794 Prepaid taxes 1,000 — Prepaid software licenses 945 790 Deposits 662 421 Prepaid rent 505 62 Prepaid inventory 49 475 Other 1,640 1,103 $ 21,077 $ 15,726 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Payables and Accruals [Abstract] | |
Summary of Accrued Expenses | A summary of accrued expenses follows (in thousands): 2023 2022 Accrued warehouse expenses $ 5,625 $ 2,671 Customer return liability 4,483 2,026 Accrued professional fees 2,167 2,268 Accrued freight and shipping 2,131 23,683 Accrued occupancy 1,278 1,284 Accrued state income taxes 1,187 1,007 Accrued insurance 1,026 973 Accrued credit card fees 770 542 Accrued advertising fees 739 4,150 Warranty liability 721 689 Other accrued expenses 3,265 1,204 $ 23,392 $ 40,497 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of federal, state and local corporate income taxes | The components of the provision for income taxes reflected on the statements of operations are set forth below: 2023 2022 2021 Current taxes: U.S. federal $ 6,990 $ — $ — State and local 3,252 2,198 86 Total current tax expense $ 10,242 $ 2,198 $ 86 Deferred taxes: U.S. federal $ 1,322 $ (7,254) $ — State and local (906) (2,582) — Total deferred tax expense (benefit) 416 (9,836) — Total tax provision $ 10,658 $ (7,638) $ 86 |
Schedule of effective income tax rate reconciliation | A reconciliation of income taxes at the federal statutory corporate rate to the effective rate is as follows: 2023 2022 2021 Provision (benefit) at federal Statutory rates 21.0 % 21.0 % 21.0 % State tax, net of federal provision (benefit) 4.3 % 4.9 % 3.3 % Non-deductible executive compensation 1.7 % 1.9 % — % Permanent adjustments 0.2 % — % 0.1 % Equity-based compensation 0.1 % (4.7) % (2.8) % Federal true-ups 0.1 % (0.4) % 0.4 % Change in valuation allowance — % (42.7) % (21.4) % Income tax provision 27.4 % (20.0) % 0.6 % |
Schedule of deferred income taxes | Significant components of the Company's deferred tax assets are as follows (in thousands): 2023 2022 Deferred Income Tax Assets Federal net operating loss carryforward $ — $ 2,082 State net operating loss carryforward 595 1,403 Intangible assets 403 397 Accrued liabilities 2,952 3,243 Equity-based compensation 3,247 2,032 Merchandise inventories 726 689 Charitable Contributions — 12 R&D Capitalization 1,920 — Operating Lease Liabilities 40,814 29,129 Total Deferred Income Tax Assets 50,657 38,987 Deferred Income Tax Liabilities Operating Lease Right of Use Asset (36,224) (26,726) Property and equipment (5,013) (2,425) Total Deferred Tax Liabilities (41,237) (29,151) Net Deferred Income Tax Asset $ 9,420 $ 9,836 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Leases [Abstract] | |
Schedule of components of lease expense | Components of lease expense were as follows (in thousands): 2023 2022 Operating lease expense $ 24,173 $ 18,902 Variable lease expense 16,207 12,439 Short term lease expense 721 336 Total lease expense $ 41,101 $ 31,677 Supplemental cash flow information and non-cash activity related to our operating leases is as follows (in thousands): 2023 2022 Operating cash flow information: Cash paid for operating lease liabilities $ 23,724 $ 14,400 Non-cash activities Net additions to right-of-use assets obtained in exchange for lease obligations $ 56,099 $ 116,048 |
Schedule of lease terms and rates | The Company’s weighted average lease term and weighted average discount rates are as follows: For the year ended 2023 2022 Weighted average remaining lease term (in years) Operating Leases 7.4 6.29 Weighted average discount rate Operating Leases 4.10 % 3.44 % |
Schedule of expected future annual minimum rental payments | Future minimum lease payments under non-cancelable leases as of January 29, 2023 were as follows (in thousands): 2024 $ 27,671 2025 26,759 2026 24,447 2027 22,083 2028 19,747 Thereafter 62,832 Total undiscounted future minimum lease payments 183,539 Less: imputed interest (25,686) Total present value of lease obligations 157,853 Less: current operating lease liability (21,898) Operating lease liability- long term $ 135,955 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Stockholders' Equity Note [Abstract] | |
Schedule of warrant activity | The following represents warrant activity during fiscal 2023, 2022, and 2021: Average exercise price Number of warrants Weighted average remaining contractual life (in years) Outstanding at February 2, 2020 16.83 1,039,120 1.93 Warrants issued — — — Expired and canceled — — — Exercised 16.00 (745,147) 0.41 Outstanding at January 31, 2021 19.07 293,973 2.57 Warrants issued — — — Expired and canceled 9.83 (98) — Exercised 16.00 (12,125) 0.09 Outstanding at January 30, 2022 19.20 281,750 1.41 Warrants issued — — — Expired and canceled — — — Exercised — — — Outstanding at January 29, 2023 $ 19.20 281,750 0.41 |
Schedule of stock option activity | The following summarizes the activity of our stock options as of January 29, 2023, January 30, 2022, and January 31, 2021 and the changes during fiscal years then ended (in thousands, except share and per share amounts) : Number of options Weighted average exercise price Weighted average remaining contractual life (in years) Aggregate intrinsic value Outstanding at February 2, 2020 495,366 $ 38.10 2.34 $ — Granted — — Canceled and forfeited — — Outstanding at January 31, 2021 495,366 38.10 3.35 9,135 Granted — — Canceled and forfeited — — Outstanding at January 30, 2022 495,366 38.10 2.35 6,162 Granted — — Canceled and forfeited — — Outstanding and exercisable at January 29, 2023 495,366 $ 38.10 1.35 $ — |
Schedule of unvested restricted stock | The following table summarizes the activity for the Company's unvested restricted stock units as of January 29, 2023, January 30, 2022, January 31, 2021, and changes during fiscal years then ended, is presented below: Number of shares Weighted average grant date fair value Unvested at February 2, 2020 183,053 $ 21.34 Granted 627,940 16.94 Forfeited (5,701) 11.86 Vested (149,734) 16.24 Unvested at January 31, 2021 655,558 18.86 Granted 94,985 78.53 Forfeited (42,516) 22.67 Vested (174,694) 19.57 Unvested at January 30, 2022 533,333 28.41 Granted 289,625 44.20 Forfeited (62,186) 29.09 Vested (120,516) 36.03 Unvested at January 29, 2023 640,256 $ 34.50 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Jan. 29, 2023 | |
Segment Reporting [Abstract] | |
Schedule of operating segments | The Company’s sales by product which are considered one segment are as follows: 2023 2022 2021 Sactionals $ 584,815 $ 436,588 $ 271,018 Sacs 55,145 52,478 44,975 Other 11,585 9,173 4,745 Total net sales $ 651,545 $ 498,239 $ 320,738 |
Basis of Presentation, and Su_3
Basis of Presentation, and Summary of Significant Accounting Policies - Narrative (Details) | 12 Months Ended | |||
Jan. 29, 2023 USD ($) showroom shares | Jan. 30, 2022 USD ($) shares | Jan. 31, 2021 USD ($) shares | Feb. 02, 2020 shares | |
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Number of showrooms | showroom | 195 | |||
Shipping and handling costs | $ 158,000,000 | $ 112,800,000 | $ 63,100,000 | |
Accrued expenses | 4,500,000 | 2,000,000 | ||
Sales return | 1,000,000 | 400,000 | ||
Customer deposit liabilities | 6,800,000 | 13,300,000 | ||
Revenue recognized from customer deposits | 13,300,000 | 6,000,000 | ||
Inventory exchanged for media credits | 21,300,000 | 3,500,000 | ||
Unused media credits | 25,200,000 | 3,400,000 | ||
Bad debt write-offs | 400,000 | 400,000 | 800,000 | |
Goodwill impairment | 0 | 0 | 0 | |
Intangible asset impairment | 0 | 0 | 0 | |
Impairment of long-lived assets | $ 0 | 554,000 | 245,000 | |
Product warranty period | 3 years | |||
Warranty expense | $ 700,000 | 500,000 | 700,000 | |
Warranty reserve | $ 700,000 | 700,000 | ||
Contributions plan, percentage | 100% | |||
Defined contribution plan, cost | $ 1,300,000 | 800,000 | 500,000 | |
Advertising expenses | $ 79,900,000 | $ 65,100,000 | $ 41,900,000 | |
Restricted stock units | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Unvested outstanding (in shares) | shares | 640,256 | 533,333 | 655,558 | 183,053 |
Warrants Activity | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Unvested outstanding warrants (in shares) | shares | 281,750 | 281,750 | 293,973 | 1,039,120 |
2017 Equity Incentive Plan | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Granted term | 10 years | |||
2017 Equity Incentive Plan | Minimum | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Granted shares, vesting term | 3 years | |||
2017 Equity Incentive Plan | Maximum | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Granted shares, vesting term | 4 years | |||
Patents | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Weighted-Average Remaining Life (in years) | 10 years | |||
Trademarks | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Weighted-Average Remaining Life (in years) | 3 years | |||
Other intangibles | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Weighted-Average Remaining Life (in years) | 5 years | |||
Restricted stock units | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Potentially dilutive shares (in shares) | shares | 640,256 | 533,333 | ||
Stock options | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Potentially dilutive shares (in shares) | shares | 495,366 | 495,366 | ||
Warrants | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Potentially dilutive shares (in shares) | shares | 281,750 | |||
Wholesale Receivables | Customer Concentration Risk | Two Customers | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Concentration risk | 100% | |||
Foreign Countries (less than) | Revenue Benchmark | Geographic Concentration Risk | ||||
Operations and Significant Accounting Policies (Details) [Line Items] | ||||
Concentration risk | 1% | 1% | 1% |
Basis of Presentation, and Su_4
Basis of Presentation, and Summary of Significant Accounting Policies (Details) - Disaggregation of revenue - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Disaggregation of Revenue [Line Items] | |||
Total net sales | $ 651,545 | $ 498,239 | $ 320,738 |
Showrooms | |||
Disaggregation of Revenue [Line Items] | |||
Total net sales | 398,550 | 298,989 | 146,150 |
Internet | |||
Disaggregation of Revenue [Line Items] | |||
Total net sales | 176,519 | 150,622 | 151,065 |
Other | |||
Disaggregation of Revenue [Line Items] | |||
Total net sales | $ 76,476 | $ 48,628 | $ 23,523 |
Basis of Presentation, and Su_5
Basis of Presentation, and Summary of Significant Accounting Policies (Details) - Schedule of accounts receivable - USD ($) $ in Thousands | Jan. 29, 2023 | Jan. 30, 2022 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Credit card receivables | $ 5,069 | $ 3,186 |
Wholesale receivables | 4,400 | 5,361 |
Trade accounts receivable | $ 9,469 | $ 8,547 |
Property and Equipment, net (De
Property and Equipment, net (Details) - Schedule of property and equipment - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 29, 2023 | Jan. 30, 2022 | |
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 85,619 | $ 57,074 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (32,715) | (22,937) |
Total property and equipment, net | $ 52,904 | 34,137 |
Office and store furniture, and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Total property and equipment, gross | $ 8,933 | 6,497 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Total property and equipment, gross | $ 3,996 | 3,625 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 60,964 | 40,788 |
Computers | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Total property and equipment, gross | $ 4,032 | 2,138 |
Tools, Dies, Molds | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Total property and equipment, gross | $ 868 | 764 |
Vehicles | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Total property and equipment, gross | $ 497 | 497 |
Construction in process | ||
Property, Plant and Equipment [Line Items] | ||
Total property and equipment, gross | $ 6,329 | $ 2,765 |
Property and Equipment, net - N
Property and Equipment, net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization of property and equipment | $ 10,454 | $ 7,154 | $ 6,100 |
Intangible Assets, net (Details
Intangible Assets, net (Details) - Schedule of other intangible assets - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 29, 2023 | Jan. 30, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 5,453 | $ 5,068 |
Accumulated Amortization | (4,042) | (3,655) |
Net carrying amount | $ 1,411 | $ 1,413 |
Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Remaining Life (in years) | 7 years 7 months 6 days | 8 years 1 month 6 days |
Gross Carrying Amount | $ 3,091 | $ 2,838 |
Accumulated Amortization | (1,864) | (1,626) |
Net carrying amount | $ 1,227 | $ 1,212 |
Trademarks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Weighted-Average Remaining Life (in years) | 2 years 2 months 12 days | 2 years 2 months 12 days |
Gross Carrying Amount | $ 1,522 | $ 1,390 |
Accumulated Amortization | (1,338) | (1,189) |
Net carrying amount | 184 | 201 |
Other intangibles | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 840 | 840 |
Accumulated Amortization | (840) | (840) |
Net carrying amount | $ 0 | $ 0 |
Intangible Assets, net - Narrat
Intangible Assets, net - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization of intangible assets | $ 388 | $ 705 | $ 513 |
Intangible Assets, net (Detai_2
Intangible Assets, net (Details) - Schedule of expected amortization expense associated with other intangible assets - USD ($) $ in Thousands | Jan. 29, 2023 | Jan. 30, 2022 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
2024 | $ 356 | |
2025 | 299 | |
2026 | 225 | |
2027 | 178 | |
2028 | 139 | |
Thereafter | 214 | |
Net carrying amount | $ 1,411 | $ 1,413 |
Prepaid Expenses and Other Cu_3
Prepaid Expenses and Other Current Assets (Details) - Schedule of other prepaid and other current assets - USD ($) $ in Thousands | Jan. 29, 2023 | Jan. 30, 2022 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Tenant allowance receivable | $ 6,160 | $ 2,781 |
Barter credits | 3,770 | 3,407 |
Rebate receivable | 2,780 | 226 |
Prepaid insurance | 2,009 | 1,667 |
Prepaid catalog costs and related | 1,557 | 4,794 |
Prepaid taxes | 1,000 | 0 |
Prepaid software licenses | 945 | 790 |
Deposits | 662 | 421 |
Prepaid rent | 505 | 62 |
Prepaid inventory | 49 | 475 |
Other | 1,640 | 1,103 |
Total prepaid expenses and other current assets | $ 21,077 | $ 15,726 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Details) - USD ($) $ in Thousands | Jan. 29, 2023 | Jan. 30, 2022 |
Payables and Accruals [Abstract] | ||
Accrued warehouse expenses | $ 5,625 | $ 2,671 |
Customer return liability | 4,483 | 2,026 |
Accrued professional fees | 2,167 | 2,268 |
Accrued freight and shipping | 2,131 | 23,683 |
Accrued occupancy | 1,278 | 1,284 |
Accrued state income taxes | 1,187 | 1,007 |
Accrued insurance | 1,026 | 973 |
Accrued credit card fees | 770 | 542 |
Accrued advertising fees | 739 | 4,150 |
Warranty liability | 721 | 689 |
Other accrued expenses | 3,265 | 1,204 |
Total accrued expenses | $ 23,392 | $ 40,497 |
Income Taxes - Schedule of fede
Income Taxes - Schedule of federal, state and local corporate income taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Current taxes: | |||
U.S. federal | $ 6,990 | $ 0 | $ 0 |
State and local | 3,252 | 2,198 | 86 |
Total current tax expense | 10,242 | 2,198 | 86 |
Deferred taxes: | |||
U.S. federal | 1,322 | (7,254) | 0 |
State and local | (906) | (2,582) | 0 |
Total deferred tax expense (benefit) | 416 | (9,836) | 0 |
Total tax provision | $ 10,658 | $ (7,638) | $ 86 |
Income Taxes - Schedule of effe
Income Taxes - Schedule of effective income tax rate reconciliation (Details) | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Income Tax Disclosure [Abstract] | |||
Provision (benefit) at federal Statutory rates | 21% | 21% | 21% |
State tax, net of federal provision (benefit) | 4.30% | 4.90% | 3.30% |
Non-deductible executive compensation | 1.70% | 1.90% | 0% |
Permanent adjustments | 0.20% | 0% | 0.10% |
Equity-based compensation | 0.10% | (4.70%) | (2.80%) |
Federal true-ups | 0.10% | (0.40%) | 0.40% |
Change in valuation allowance | 0% | (42.70%) | (21.40%) |
Income tax provision | 27.40% | (20.00%) | 0.60% |
Income Taxes - Schedule of defe
Income Taxes - Schedule of deferred income taxes (Details) - USD ($) $ in Thousands | Jan. 29, 2023 | Jan. 30, 2022 |
Deferred Income Tax Assets | ||
Federal net operating loss carryforward | $ 0 | $ 2,082 |
State net operating loss carryforward | 595 | 1,403 |
Intangible assets | 403 | 397 |
Accrued liabilities | 2,952 | 3,243 |
Equity-based compensation | 3,247 | 2,032 |
Merchandise inventories | 726 | 689 |
Charitable Contributions | 0 | 12 |
R&D Capitalization | 1,920 | 0 |
Operating Lease Liabilities | 40,814 | 29,129 |
Total Deferred Income Tax Assets | 50,657 | 38,987 |
Deferred Income Tax Liabilities | ||
Operating Lease Right of Use Asset | (36,224) | (26,726) |
Property and equipment | (5,013) | (2,425) |
Total Deferred Tax Liabilities | (41,237) | (29,151) |
Net Deferred Income Tax Asset | $ 9,420 | $ 9,836 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Jan. 29, 2023 | Jan. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards available for federal income tax | $ 9.9 | |
State net operating loss carryforwards | $ 9.4 | 22.2 |
Increased (decreased) the valuation allowance | $ 7.7 | $ (16.4) |
Leases - Schedule of components
Leases - Schedule of components of lease expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 29, 2023 | Jan. 30, 2022 | |
Leases [Abstract] | ||
Operating lease expense | $ 24,173 | $ 18,902 |
Variable lease expense | 16,207 | 12,439 |
Short term lease expense | 721 | 336 |
Total lease expense | $ 41,101 | $ 31,677 |
Leases - Schedule of lease term
Leases - Schedule of lease terms and rates (Details) | Jan. 29, 2023 | Jan. 30, 2022 |
Leases [Abstract] | ||
Weighted average remaining lease term, operating leases | 7 years 4 months 24 days | 6 years 3 months 14 days |
Weighted average discount rate, operating leases | 4.10% | 3.44% |
Leases (Details)
Leases (Details) - USD ($) | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Leases [Abstract] | |||
Impairment charges | $ 0 | $ 600,000 | $ 0 |
Leases - Schedule of future min
Leases - Schedule of future minimum payments for operating leases (Details) - USD ($) $ in Thousands | Jan. 29, 2023 | Jan. 30, 2022 |
Leases [Abstract] | ||
2024 | $ 27,671 | |
2025 | 26,759 | |
2026 | 24,447 | |
2027 | 22,083 | |
2028 | 19,747 | |
Thereafter | 62,832 | |
Total undiscounted future minimum lease payments | 183,539 | |
Less: imputed interest | (25,686) | |
Total present value of lease obligations | 157,853 | |
Current operating lease liabilities | (21,898) | $ (16,382) |
Operating Lease Liabilities, long term | $ 135,955 | $ 96,574 |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jan. 29, 2023 | Jan. 30, 2022 | |
Leases [Abstract] | ||
Cash paid for operating lease liabilities | $ 23,724 | $ 14,400 |
Net additions to right-of-use assets obtained in exchange for lease obligations | $ 56,099 | $ 116,048 |
Commitments, Contingencies an_2
Commitments, Contingencies and Related Parties - Narrative (Details) - USD ($) | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Commitments, Contingencies and Related Parties (Details) [Line Items] | |||
Inventory disposal | $ 600,000 | ||
Proceeds from insurance settlement | 1,200,000 | ||
Gain on recovery of insurance proceeds - lost profit margin | $ 0 | 632,000 | $ 0 |
Mistral Capital Management, LLC | |||
Commitments, Contingencies and Related Parties (Details) [Line Items] | |||
Management fees and expenses | 0 | 0 | 400,000 |
Amounts payable to related parties | 0 | 0 | 100,000 |
Satori Capital, LLC | |||
Commitments, Contingencies and Related Parties (Details) [Line Items] | |||
Management fees and expenses | 0 | 0 | 100,000 |
Amounts payable to related parties | 0 | 0 | 100,000 |
Blueport Commerce | |||
Commitments, Contingencies and Related Parties (Details) [Line Items] | |||
Amounts payable to related parties | 0 | 0 | 0 |
Fees incurred sales transactions | $ 0 | $ 0 | 2,100,000 |
Fee incurred, termination of contract | $ 700,000 |
Stockholders' Equity - Narrativ
Stockholders' Equity - Narrative (Details) $ / shares in Units, $ in Thousands | 1 Months Ended | 12 Months Ended | |||||
Jun. 05, 2021 trading_day $ / shares | Jun. 29, 2018 shares | Jun. 30, 2020 shares | Jun. 30, 2019 USD ($) trading_day $ / shares shares | Jan. 29, 2023 USD ($) shares | Jan. 30, 2022 USD ($) shares | Jan. 31, 2021 USD ($) shares | |
Class of Stock [Line Items] | |||||||
Warrants issued (in shares) | 281,750 | ||||||
Warrants issued, term | 5 years | ||||||
Cashless warrant exercised (in shares) | 0 | 5,625 | 738,897 | ||||
Warrants expired (in shares) | 98 | ||||||
Stock options are subject to vesting percentage | 100% | ||||||
Consecutive trading days | trading_day | 40 | 40 | |||||
Stock price (in dollars per share) | $ / shares | $ 75 | $ 75 | |||||
Additional compensation | $ | $ 900 | $ 900 | |||||
Modification and remaining expense was recognized | $ | $ 300 | ||||||
Equity-based compensation | $ | $ 10,450 | $ 5,859 | $ 4,681 | ||||
Total unrecognized equity based compensation cost related to unvested stock option and restricted unit awards (in Dollars) | $ | $ 4,200 | ||||||
Weighted average period | 1 year 11 months 12 days | ||||||
Performance Shares | |||||||
Class of Stock [Line Items] | |||||||
Equity-based compensation | $ | $ 4,300 | ||||||
Granted shares, vesting term | 3 years | ||||||
Net sales performance target | $ | $ 550,000 | ||||||
Adjusted EBITDA performance target | $ | $ 50,000 | ||||||
2017 Equity Incentive Plan | |||||||
Class of Stock [Line Items] | |||||||
Granted term | 10 years | ||||||
Common stock reserved for issuance (in shares) | 690,000 | 2,654,889 | |||||
Non statutory stock options granted (in shares) | 495,366 | ||||||
Stock option price exercise (in dollars per share) | $ / shares | $ 38.10 | ||||||
2017 Equity Incentive Plan | Minimum | |||||||
Class of Stock [Line Items] | |||||||
Number of shares of common stock reserved for issuance (in shares) | 1,414,889 | ||||||
Granted shares, vesting term | 3 years | ||||||
2017 Equity Incentive Plan | Maximum | |||||||
Class of Stock [Line Items] | |||||||
Number of shares of common stock reserved for issuance (in shares) | 2,104,889 | 550,000 | |||||
Granted shares, vesting term | 4 years | ||||||
Common Shares | |||||||
Class of Stock [Line Items] | |||||||
Exercise of warrants (in shares) | 10,956 | 439,447 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - Schedule of warrant activity - Warrants Activity - $ / shares | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Class of Warrant or Right [Line Items] | |||
Average exercise price, warrants outstanding, beginning balance (in dollars per share) | $ 19.20 | $ 19.07 | $ 16.83 |
Average exercise price, warrants issued (in dollars per share) | 0 | 0 | 0 |
Average exercise price, expired and canceled (in dollars per share) | 0 | 9.83 | 0 |
Average exercise price, exercised (in dollars per share) | 0 | 16 | 16 |
Average exercise price, warrants outstanding, ending balance (in dollars per share) | $ 19.20 | $ 19.20 | $ 19.07 |
Number of options | |||
Number of warrants, outstanding, beginning balance (in shares) | 281,750 | 293,973 | 1,039,120 |
Number of warrants, warrants issued (in shares) | 0 | 0 | 0 |
Number of warrants, expired and canceled (in shares) | 0 | (98) | 0 |
Number of warrants, exercised (in shares) | 0 | (12,125) | (745,147) |
Number of warrants, warrants outstanding, ending balance (in shares) | 281,750 | 281,750 | 293,973 |
Weighted average remaining contractual life (in years). warrants outstanding, beginning balance | 1 year 4 months 28 days | 2 years 6 months 25 days | 1 year 11 months 4 days |
Weighted average remaining contractual life (in years), exercised | 1 month 2 days | 4 months 28 days | |
Weighted average remaining contractual life (in years). warrants outstanding, ending balance | 4 months 28 days | 1 year 4 months 28 days | 2 years 6 months 25 days |
Stockholders' Equity (Details_2
Stockholders' Equity (Details) - Schedule of stock option activity - $ / shares | 12 Months Ended | |||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | Feb. 02, 2020 | |
Number of options | ||||
Number of options, outstanding, beginning balance (in shares) | 495,366 | 495,366 | 495,366 | |
Number of options, granted (in shares) | 0 | 0 | 0 | |
Number of options, canceled and forfeited (in shares) | 0 | 0 | 0 | |
Number of options, outstanding, ending balance (in shares) | 495,366 | 495,366 | 495,366 | 495,366 |
Weighted average exercise price | ||||
Weighted average exercise price, outstanding balance (in dollars per share) | $ 38.10 | $ 38.10 | $ 38.10 | |
Weighted average exercise price, granted (in dollars per share) | 0 | 0 | 0 | |
Weighted average exercise price, canceled and forfeited (in dollars per share) | 0 | 0 | 0 | |
Weighted average exercise price, outstanding balance (in dollars per share) | $ 38.10 | $ 38.10 | $ 38.10 | $ 38.10 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||
Weighted average remaining contractual life, outstanding (in years) | 1 year 4 months 6 days | 2 years 4 months 6 days | 3 years 4 months 6 days | 2 years 4 months 2 days |
Average intrinsic value, outstanding, beginning balance (in dollars per share) | $ 6,162,000 | $ 9,135,000 | $ 0 | |
Average intrinsic value, outstanding, ending balance (in dollars per share) | $ 0 | $ 6,162,000 | $ 9,135,000 | $ 0 |
Stockholders' Equity (Details_3
Stockholders' Equity (Details) - Schedule of unvested restricted stock - Restricted stock units - $ / shares | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Number of shares | |||
Number of shares, unvested, beginning balance (in shares) | 533,333 | 655,558 | 183,053 |
Number of shares, granted (in shares) | 289,625 | 94,985 | 627,940 |
Number of shares, forfeited (in shares) | (62,186) | (42,516) | (5,701) |
Number of shares, vested (in shares) | (120,516) | (174,694) | (149,734) |
Number of shares, unvested, ending balance (in shares) | 640,256 | 533,333 | 655,558 |
Weighted average grant date fair value | |||
Weighted average grant date fair value, unvested, beginning balance (in dollars per share) | $ 28.41 | $ 18.86 | $ 21.34 |
Weighted average grant date fair value, granted (in dollars per share) | 44.20 | 78.53 | 16.94 |
Weighted average grant date fair value, forfeited (in dollars per share) | 29.09 | 22.67 | 11.86 |
Weighted average grant date fair value, vested (in dollars per share) | 36.03 | 19.57 | 16.24 |
Weighted average grant date fair value, unvested, ending balance (in dollars per share) | $ 34.50 | $ 28.41 | $ 18.86 |
Financing Arrangements (Details
Financing Arrangements (Details) - USD ($) | Mar. 25, 2022 | Jan. 29, 2023 | Feb. 06, 2018 |
Financing Arrangements (Details) [Line Items] | |||
Borrowings amount | $ 40,000,000 | $ 36,000,000 | $ 25,000,000 |
Borrowing availability under the line of credit | 22,500,000 | ||
Line of credit, undrawn availability percentage | 10% | ||
Line of credit | $ 0 | ||
Minimum | Base Rate | |||
Financing Arrangements (Details) [Line Items] | |||
Variable rate | 0.50% | ||
Minimum | Secured Overnight Financing Rate (SOFR) | |||
Financing Arrangements (Details) [Line Items] | |||
Variable rate | 1.625% | ||
Maximum | Base Rate | |||
Financing Arrangements (Details) [Line Items] | |||
Variable rate | 0.75% | ||
Maximum | Secured Overnight Financing Rate (SOFR) | |||
Financing Arrangements (Details) [Line Items] | |||
Variable rate | 1.85% |
Segment Information (Details)
Segment Information (Details) | 12 Months Ended |
Jan. 29, 2023 segment | |
Segment Reporting [Abstract] | |
Number of reporting segments | 1 |
Segment Information (Details) -
Segment Information (Details) - Schedule of operating segments - USD ($) $ in Thousands | 12 Months Ended | ||
Jan. 29, 2023 | Jan. 30, 2022 | Jan. 31, 2021 | |
Segment Reporting Information [Line Items] | |||
Net sales | $ 651,545 | $ 498,239 | $ 320,738 |
Sactionals | |||
Segment Reporting Information [Line Items] | |||
Net sales | 584,815 | 436,588 | 271,018 |
Sacs | |||
Segment Reporting Information [Line Items] | |||
Net sales | 55,145 | 52,478 | 44,975 |
Other | |||
Segment Reporting Information [Line Items] | |||
Net sales | $ 11,585 | $ 9,173 | $ 4,745 |