Steel Connect (STCN) 10-Q 17 Mar 22 2022 Q2 Quarterly report Financial data

Cover Page

Cover Page - shares	6 Months Ended
	Jan. 31, 2022	Mar. 01, 2022
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jan. 31, 2022
Document Transition Report	false
Entity File Number	001-35319
Entity Registrant Name	Steel Connect, Inc.
Amendment Flag	false
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Entity Central Index Key	0000914712
Current Fiscal Year End Date	--07-31
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	04-2921333
Entity Address, Address Line One	2000 Midway Ln
Entity Address, City or Town	Smyrna
Entity Address, State or Province	TN
Entity Address, Postal Zip Code	37167
City Area Code	914
Local Phone Number	461-1276
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		60,457,720
Common Stock
Entity Information [Line Items]
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	STCN
Security Exchange Name	NASDAQ
Series D Preferred Stock
Entity Information [Line Items]
No Trading Symbol	true
Title of 12(b) Security	Rights to Purchase Series D Junior Participating Preferred Stock
Security Exchange Name	NASDAQ

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Current Assets
Cash and cash equivalents	$ 64,646	$ 96,931
Accounts receivable, trade, net of allowance for doubtful accounts of $44 and $49 at January 31, 2022 and July 31, 2021, respectively	68,971	69,805
Inventories, net	19,428	16,228
Funds held for clients	5,635	8,212
Prepaid expenses and other current assets	19,901	22,222
Total current assets	178,581	213,398
Property and equipment, net	48,964	58,862
Goodwill	231,470	231,470
Other intangible assets, net	106,920	115,005
Operating lease right-of-use assets	50,385	50,836
Other assets	6,364	6,810
Total assets	622,684	676,381
Current Liabilities
Accounts payable	57,330	55,517
Accrued expenses	104,876	106,871
Funds held for clients	5,635	8,212
Current portion of long-term debt	360,996	5,602
Current lease obligations	12,878	13,690
Other current liabilities	25,594	28,101
Total current liabilities	567,309	217,993
Convertible note payable	10,143	9,343
Long-term debt, excluding current portion	0	358,189
Long-term lease obligations	39,149	38,927
Other long-term liabilities	7,643	10,537
Total long-term liabilities	56,935	416,996
Total liabilities	624,244	634,989
Contingently redeemable preferred stock, $0.01 par value per share. 35,000 shares authorized, issued and outstanding at January 31, 2022 and July 31, 2021	35,180	35,180
Stockholders' equity:
Preferred stock, $0.01 par value per share. 4,965,000 shares authorized at January 31, 2022 and July 31, 2021; zero shares issued and outstanding at January 31, 2022 and July 31, 2021	0	0
Common stock, $0.01 par value per share. Authorized 1,400,000,000 shares; 60,457,720 issued and outstanding shares at January 31, 2022; 63,099,496 issued and outstanding shares at July 31, 2021	605	632
Additional paid-in capital	7,479,073	7,478,638
Accumulated deficit	(7,523,765)	(7,480,220)
Accumulated other comprehensive income	7,347	7,162
Total stockholders' (deficit) equity	(36,740)	6,212
Total liabilities, contingently redeemable preferred stock and stockholders' (deficit) equity	$ 622,684	$ 676,381

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Accounts receivable, trade, allowance for doubtful accounts	$ 44	$ 49
Preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	4,965,000	4,965,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	1,400,000,000	1,400,000,000
Common stock, shares issued (in shares)	60,457,720	63,099,496
Common stock, shares outstanding (in shares)	60,457,720	63,099,496
Contingent Redeemable Preferred Stock
Preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	35,000	35,000
Preferred stock, shares issued (in shares)	35,000	35,000
Preferred stock, shares outstanding (in shares)	35,000	35,000

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Condensed Income Statements, Captions [Line Items]
Net revenue	$ 120,638	$ 156,047	$ 246,051	$ 325,981
Cost of revenue	107,038	120,197	217,171	249,663
Gross profit	13,600	35,850	28,880	76,318
Operating expenses:
Selling, general and administrative	23,908	21,810	45,913	48,668
Amortization of intangible assets	3,903	5,359	8,085	11,894
Total operating expenses	27,811	27,169	53,998	60,562
Operating (loss) income	(14,211)	8,681	(25,118)	15,756
Other income (expense):
Interest income	2	0	6	20
Interest expense	(7,980)	(7,825)	(15,775)	(15,648)
Other losses, net	(65)	(2,161)	(546)	(4,180)
Total other expense, net	(8,043)	(9,986)	(16,315)	(19,808)
Loss before income taxes	(22,254)	(1,305)	(41,433)	(4,052)
Income tax expense	723	891	1,038	1,695
Net loss	(22,977)	(2,196)	(42,471)	(5,747)
Less: Preferred dividends on redeemable preferred stock	(537)	(530)	(1,074)	(1,067)
Net loss attributable to common stockholders	$ (23,514)	$ (2,726)	$ (43,545)	$ (6,814)
Basic net loss per share attributable to common stockholders (in usd per share)	$ (0.39)	$ (0.04)	$ (0.73)	$ (0.11)
Diluted net loss per share attributable to common stockholders (in usd per share)	$ (0.39)	$ (0.04)	$ (0.73)	$ (0.11)
Weighted average common shares used in:
Basic loss per share (in shares)	59,748	62,028	60,027	61,961
Diluted loss per share (in shares)	59,748	62,028	60,027	61,961
Products
Condensed Income Statements, Captions [Line Items]
Net revenue	$ 66,316	$ 91,155	$ 147,375	$ 196,863
Cost of revenue	63,617	68,740	138,802	149,932
Services
Condensed Income Statements, Captions [Line Items]
Net revenue	54,322	64,892	98,676	129,118
Cost of revenue	$ 43,421	$ 51,457	$ 78,369	$ 99,731

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Statement of Comprehensive Income [Abstract]
Net loss	$ (22,977)	$ (2,196)	$ (42,471)	$ (5,747)
Other comprehensive (loss) income:
Foreign currency translation adjustment	(13)	2,420	185	5,393
Total other comprehensive (loss) income	(13)	2,420	185	5,393
Comprehensive (loss) income	$ (22,990)	$ 224	$ (42,286)	$ (354)

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Income
Beginning balance (in shares) at Jul. 31, 2020		62,787,919
Beginning balance at Jul. 31, 2020	$ 48,818	$ 628	$ 7,478,047	$ (7,433,700)	$ 3,843
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(5,747)			(5,747)
Preferred dividends	(1,067)			(1,067)
Issuance of common stock pursuant to employee stock purchase plan (in shares)		8,430
Issuance of common stock pursuant to employee stock purchase plan	4		4
Restricted stock grants (in shares)		236,860
Restricted stock grants	0	$ 2	(2)
Restricted stock forfeitures, net of issuance (in shares)		(32,895)
Restricted stock forfeitures	0	$ 0	0
Share-based compensation	346		346
Other comprehensive items	5,393				5,393
Ending balance (in shares) at Jan. 31, 2021		63,000,314
Ending balance at Jan. 31, 2021	47,747	$ 630	7,478,395	(7,440,514)	9,236
Beginning balance (in shares) at Oct. 31, 2020		62,793,969
Beginning balance at Oct. 31, 2020	47,894	$ 628	7,478,238	(7,437,788)	6,816
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(2,196)			(2,196)
Preferred dividends	(530)			(530)
Issuance of common stock pursuant to employee stock purchase plan (in shares)		1,448
Issuance of common stock pursuant to employee stock purchase plan	1		1
Restricted stock grants (in shares)		204,897
Restricted stock grants	0	$ 2	(2)
Share-based compensation	158		158
Other comprehensive items	2,420				2,420
Ending balance (in shares) at Jan. 31, 2021		63,000,314
Ending balance at Jan. 31, 2021	$ 47,747	$ 630	7,478,395	(7,440,514)	9,236
Beginning balance (in shares) at Jul. 31, 2021	63,099,496	63,099,496
Beginning balance at Jul. 31, 2021	$ 6,212	$ 632	7,478,638	(7,480,220)	7,162
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(42,471)			(42,471)
Preferred dividends	(1,074)			(1,074)
Issuance of common stock pursuant to employee stock purchase plan (in shares)		499
Restricted stock grants (in shares)		207,725
Restricted stock grants	0	$ 2	(2)
Restricted stock forfeitures, net of issuance (in shares)		(2,850,000)
Restricted stock forfeitures	0	$ (29)	29
Share-based compensation	408		408
Other comprehensive items	$ 185				185
Ending balance (in shares) at Jan. 31, 2022	60,457,720	60,457,720
Ending balance at Jan. 31, 2022	$ (36,740)	$ 605	7,479,073	(7,523,765)	7,347
Beginning balance (in shares) at Oct. 31, 2021		60,437,654
Beginning balance at Oct. 31, 2021	(13,431)	$ 605	7,478,855	(7,500,251)	7,360
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(22,977)			(22,977)
Preferred dividends	(537)			(537)
Issuance of common stock pursuant to employee stock purchase plan (in shares)		331
Restricted stock grants (in shares)		119,735
Restricted stock grants	0	$ 1	(1)
Restricted stock forfeitures, net of issuance (in shares)		(100,000)
Restricted stock forfeitures	0	$ (1)	1
Share-based compensation	218		218
Other comprehensive items	$ (13)				(13)
Ending balance (in shares) at Jan. 31, 2022	60,457,720	60,457,720
Ending balance at Jan. 31, 2022	$ (36,740)	$ 605	$ 7,479,073	$ (7,523,765)	$ 7,347

CONDENSED CONSOLIDATED STATEM_4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021
Cash flows from operating activities:
Net loss	$ (42,471)	$ (5,747)
Adjustments to reconcile net loss to cash flows from operating activities:
Depreciation	16,340	11,117
Amortization of intangible assets	8,085	11,894
Amortization of deferred financing costs	273	260
Accretion of debt discount	800	605
Impairment of long-lived assets	70	0
Share-based compensation	408	346
Non-cash lease expense	7,015	7,158
Other losses, net	186	5,795
Changes in operating assets and liabilities:
Accounts receivable, net	1,268	7,143
Inventories, net	(3,380)	1,658
Prepaid expenses and other current assets	2,319	(4,195)
Accounts payable and accrued expenses	1,240	(15,756)
Refundable and accrued income taxes, net	(519)	225
Other assets and liabilities	(14,803)	(15,317)
Net cash (used in) provided by operating activities	(23,169)	5,186
Cash flows from investing activities:
Additions of property and equipment	(8,152)	(2,160)
Proceeds from the disposition of property and equipment	963	0
Net cash used in investing activities	(7,189)	(2,160)
Cash flows from financing activities:
Long-term debt repayments	(3,000)	(3,000)
Preferred dividend payments	(1,073)	(1,067)
Repayments on capital lease obligations	(36)	(35)
Proceeds from issuance of common stock	0	4
Net cash used in financing activities	(4,109)	(4,098)
Net effect of exchange rate changes on cash, cash equivalents and restricted cash	(395)	683
Net decrease in cash, cash equivalents and restricted cash	(34,862)	(389)
Cash, cash equivalents and restricted cash, beginning of period	105,143	94,642
Cash, cash equivalents and restricted cash, end of period	70,281	94,253
Cash and cash equivalents, end of period	64,646	87,649
Funds held for clients, end of period	$ 5,635	$ 6,604

NATURE OF OPERATIONS

NATURE OF OPERATIONS	6 Months Ended
	Jan. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF OPERATIONS	NATURE OF OPERATIONS Steel Connect, Inc., together with its consolidated subsidiaries (the "Company"), operates through its wholly-owned subsidiaries, IWCO Direct Holdings, Inc. ("IWCO Direct" or "Direct Marketing") and ModusLink Corporation ("ModusLink" or "Supply Chain"). ModusLink Corporation provides digital and physical supply chain solutions to many of the world's leading brands across a diverse range of industries, including consumer electronics, telecommunications, computing and storage, software and content, consumer packaged goods, medical devices, retail and luxury and connected devices. With a global footprint spanning North America, Europe and the Asia Pacific, the Company's solutions and services are designed to improve end-to-end supply chains in order to drive growth, lower costs, and improve profitability. IWCO Direct delivers data-driven marketing solutions for its customers. Its full range of services includes strategy, creative and execution for omnichannel marketing campaigns, along with postal logistics programs for direct mail. Through its Mail-Gard® division, IWCO Direct also offers business continuity and disaster recovery services to protect against unexpected business interruptions, along with providing print and mail outsourcing services. Disposition of IWCO Direct On February 25, 2022, the Company entered into a transaction agreement (the “Transaction Agreement”) with (a) IWCO Direct and its indirect subsidiaries, (b) Cerberus Business Finance, LLC, in its capacities as collateral agent and administrative agent under a financing agreement (in such capacities, the “Agent”), dated as of December 15, 2017, between IWCO Direct, IWCO Direct’s direct and indirect subsidiaries, the Agent and the lenders party thereto (the “Lenders”) (the “Financing Agreement”), (c) the Lenders, (d) the Lenders or their respective designees listed on the signature pages to the Transaction Agreement under the caption “Participating Lender Purchasers” (the “Participating Lender Purchasers”), (e) SPH Group Holdings LLC (the “Sponsor”) and (f) Instant Web Holdings, LLC (the “Buyer”) , an entity owned by the Participating Lender Purchasers. On the Effective Date (as defined in the Transaction Agreement) and pursuant to the terms of the Transaction Agreement, the Company transferred all of its interests in IWCO Direct to the Buyer as part of a negotiated restructuring of the capital structure and certain financial obligations of IWCO Direct under the Financing Agreement as contemplated by the Transaction Agreement. The Company received no cash consideration for the disposition (the entire transaction being referred to as the “IWCO Direct Disposal”). In addition, as of the Effective Date and subject to the terms and conditions of the Transaction Agreement, the parties entered into certain mutual releases as fully set forth in the Transaction Agreement. In addition, as part of the overall transaction, the Buyer issued a note in the principal amount of $6.9 million payable to the Company as consideration for intercompany obligations owed by IWCO Direct to the Company (the “Subordinated Note”). The Subordinated Note is subordinated to the obligations under the Financing Agreement (including any amendments or other modifications thereto) and matures on the date that is the earlier of (a) the later of (i) August 25, 2027 and (ii) the date that is six months after the maturity of the Financing Agreement, and (b) the date that is six months after repayment in full of the obligations under the Financing Agreement. Due to the subordinated nature of the note and the assessment of collectability, the Company determined the fair value of the Subordinated Note was zero. The foregoing description of the Transaction Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Transaction Agreement, a copy of which is filed as Exhibit 10.1 to the Company's Form 8-K dated February 25, 2022. The Company deconsolidated IWCO Direct as of February 25, 2022 as it no longer held a controlling financial interest as of that date. The Company expects to record a book gain as of disposal date based on the amount of IWCO Direct’s assets and liabilities. In addition, upon the deconsolidation of IWCO Direct, which had an estimated net deferred tax liability balance of $11.6 million, the Company anticipates recording a valuation allowance in the same amount, with a corresponding increase to income tax expense. The Company did not have any amounts included in accumulated other comprehensive loss associated with IWCO Direct at the time of deconsolidation. As of January 31, 2022, IWCO Direct had assets and liabilities of approximately $469.7 million and $516.3 million, respectively. The results of IWCO Direct will be presented as a discontinued operation in future reporting periods. As of January 31, 2022, IWCO Direct did not have any available borrowing capacity under its Cerberus Credit Facility which was no longer in effect on the date of the IWCO Disposal. The following table summarizes the Company’s unaudited pro forma financial information for the six months ended January 31, 2022 and the fiscal year ended July 31, 2021 as if the IWCO Direct Disposal occurred on August 1, 2020. Six Months Ended January 31, Fiscal Year Ended July 31, (In thousands) Net revenue $ 98,676 $ 226,256 Cost of revenue $ 78,369 $ 178,552 Operating income (loss) $ 622 $ (1,569) The unaudited pro forma information is presented for illustration purposes only and is not necessarily indicative of the operating results that would have occurred had the IWCO Direct Disposal been completed on August 1, 2020, nor is it necessarily indicative of future operating results of the Company. Liquidity and Capital Resources Historically, the Company has financed its operations and met its capital requirements primarily through funds generated from operations, the sale of its securities, borrowings from lending institutions and sale of facilities that were not fully utilized. The Company believes it has access to adequate resources to meet its needs for normal operating costs, capital expenditures and working capital for its existing business for at least twelve months from the date of this filing. As of January 31, 2022, these resources include current cash and cash equivalents, ModusLink's $12.5 million revolving credit facility pursuant to the MidCap Credit Agreement with MidCap Financial Trust ("MidCap"), and cash, if any, provided by operating activities. As of January 31, 2022, ModusLink had readily available borrowing capacity under its revolving credit facility with MidCap of $9.2 million. As of and during the fiscal quarter ended January 31, 2022, ModusLink was in compliance with all financial covenants in the MidCap Credit Agreement. For more information on the termination of the MidCap credit facility and the entry into the new credit facility with Umpqua Bank, see Note 9. The MidCap Credit Agreement was unaffected by the deconsolidation of IWCO Direct in February 2022. As of January 31, 2022, IWCO Direct did not have any available borrowing capacity under its Cerberus Credit Facility, which was no longer in effect on the date of the IWCO Direct Disposal. As of January 31, 2022 and July 31, 2021, the Company had cash and cash equivalents of $64.6 million and $96.9 million, respectively. As of January 31, 2022, the Company had a working capital deficit of $388.7 million, which included $361.0 million current portion of the Cerberus Term Loan which was extinguished upon the IWCO Disposal. Impact of COVID-19 The ongoing COVID-19 pandemic (in particular, the emergence of new variants of the virus across the globe) has caused, and continues to cause, significant disruptions in the U.S. and global economies. For example, national and local governments in the United States and around the world continue to implement measures to prevent the spread of COVID-19 and its variants, including travel bans, prohibitions on group events and gatherings, shutdowns of certain businesses, quarantines, curfews, and recommendations to practice physical distancing. Such measures have restricted and continue to restrict individuals’ daily activities and curtail or cease many businesses’ normal operations. The COVID-19 pandemic has adversely impacted, and is likely to further adversely impact, nearly all aspects of our business and markets, including our workforce and the operations of our clients, suppliers, and business partners. Beginning in March 2020, when the World Health Organization categorized COVID-19 as a pandemic and the President of the United States declared the COVID-19 outbreak a national emergency, we experienced impacts to our customers' demand, facility operations, supply chain, availability and productivity of personnel, while also working to comply with rapidly evolving international, federal, state and local restrictions and recommendations on travel and workplace health and safety. We experienced disruptions to our business continuity as a result of temporary closures of certain of ModusLink’s facilities in the third and fourth quarters of fiscal year 2020, as well as the fourth quarter of fiscal year 2021. However, these temporary closures did not have a significant impact on ModusLink’s operations. Recently, an outbreak in Mainland China forced temporary lockdown orders from March 14, 2022 to March 20, 2022 in several cities in which ModusLink operates. We do not expect significant impacts to ModusLink’s operations, and as of the filing of this quarterly report on Form 10-Q one facility was shut due to the temporary lockdown and all other ModusLink facilities were operating at or near capacity. We will evaluate further actions if circumstances warrant. Beginning in the second quarter of 2020, with the shutdown of the U.S. economy due to the COVID-19 pandemic, IWCO Direct’s business was also significantly and adversely affected by a material reduction in customer mailing activities. Additionally, although IWCO Direct operated as an essential business, it had reduced operating levels and labor shifts due to lower sales volume during the third quarter of fiscal year 2020. To help combat these impacts and mitigate the financial impact of the COVID-19 pandemic on our business, during fiscal year 2020 we took proactive measures by initiating cost reduction actions, including the waiver of board fees, hiring freezes, staffing and force reductions, company-wide salary reductions, bonus payment deferrals and temporary 401(k) match suspension. The temporary waiver of board fees and company-wide salary reduction actions taken in the prior fiscal year were fully restored prior to the beginning of fiscal year 2021, and the majority of salary reductions were repaid prior to the fiscal quarter ended January 31, 2021. Additionally, against the background of the reduction in IWCO’s business, the Company held extensive discussions with Cerberus about amending and extending IWCO Direct’s credit facility with Cerberus under which there was approximately $361.3 million outstanding as of January 31, 2022 that was to mature in December 2022. These discussions ultimately resulted in the IWCO Direct Disposal. For more information, see “Disposition of IWCO Direct” above. We continue our focus on cash management and liquidity, which includes aggressive working capital management. In addition, we continue to aim to closely monitor the impact of COVID-19 on all aspects of our business and geographies, including its impact on our clients, employees, suppliers, vendors, business partners and distribution channels. We believe that such impacts could include, the continued disruption to the demand for our businesses' products and services; disruptions in or closures of our business operations or those of our customers or suppliers; the impact of the global business and economic environment on liquidity and the availability of capital; increased costs and delays in payments of outstanding receivables beyond normal payment terms; supply chain disruptions; uncertain demand; and the effect of any initiatives or programs that we may undertake to address financial and operational challenges faced by our customers. Despite indications of economic recovery, the severity of the impact of the COVID-19 pandemic on the Company’s business in the fiscal year ending July 31, 2022 and beyond is difficult to predict and will depend on a number of uncertain factors and trends. Such factors and trends include, but not limited to: the duration and severity of the virus and its current variants; the emergence of new variant strains; the availability and widespread use of vaccines; the impact of the global business and economic environment on liquidity and the availability of capital; the extent and severity of the impact on our customers and suppliers; and U.S. and foreign government actions that have been taken, or may be taken in the future, to mitigate adverse economic or other impacts or to mitigate the spread of the virus and its variants. The Company continues to monitor for any developments or updates to COVID-19 guidelines from public health and governmental authorities, as well as the protection of the health and safety of its personnel, and is continuously working to ensure that its health and safety protocols, business continuity plans and crisis management protocols are in place to help mitigate any negative impacts of the COVID-19 pandemic on the Company’s employees, business or operations. Steel Holdings Expression of Interest On November 19, 2020, the Company's Board of Directors (the "Board") received a preliminary, non-binding expression of interest (the "Expression of Interest") from Steel Partners Holdings L.P. ("Steel Holdings") to acquire all of the outstanding shares of common stock not already owned by Steel Holdings or its affiliates for a combination of cash and Steel Holdings 6% Series A Preferred Units, which would imply a value per share of common stock in the range of $0.65 to $0.72 per share. The Board has established a special committee comprised solely of independent directors (the "Acquisition Proposal Special Committee") authorized to retain independent legal and financial advisors and to review, evaluate, negotiate and approve or disapprove the Expression of Interest, and to explore alternative strategies or transactions. The Acquisition Proposal Special Committee announced on January 11, 2021 that it had retained financial advisors and legal counsel. As set forth in the Expression of Interest, the proposed transaction will be subject to the approval of the Acquisition Proposal Special Committee, as well as a non-waivable condition requiring approval of a majority of the shares outstanding of the Company not owned by Steel Holdings and its affiliates and related parties. The Board resolutions establishing the Acquisition Proposal Special Committee expressly provide that the Board will not approve the proposed transaction contemplated by the Expression of Interest or any alternative thereto without a prior favorable recommendation by the Acquisition Proposal Special Committee. The Board has only received a expression of interest, which it continues to negotiate with Steel Holdings. The expression of interest under negotiation does not constitute a definitive offer capable of acceptance, and may be withdrawn at any time and in any manner. There can be no assurance that any definitive offer will be made, that any agreement will be executed or that the transaction proposed in the Expression of Interest or any other transaction will be approved or completed. The Company is not obligated to disclose any further developments or updates on the progress of the proposed transaction until either the Company enters into a definitive agreement or the Acquisition Proposal Special Committee determines no such transaction will be approved.

BASIS OF PRESENTATION

BASIS OF PRESENTATION	6 Months Ended
	Jan. 31, 2022
Accounting Policies [Abstract]
BASIS OF PRESENTATION	BASIS OF PRESENTATIONThe accompanying condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of a normal recurring nature) considered necessary for fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes for the year ended July 31, 2021 (Fiscal Year 2021), which are contained in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on October 29, 2021, as amended on November 30, 2021 (the "2021 Annual Report'). The results for the six months ended January 31, 2022 are not necessarily indicative of the results to be expected for the full fiscal year. The year-end condensed consolidated balance sheet data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP. All significant intercompany transactions and balances have been eliminated in consolidation. The Company considers events or transactions that occur after the balance sheet date but before the issuance of financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. For the six months ended January 31, 2022, the Company evaluated subsequent events for potential recognition and disclosure through the date these financial statements were filed. Reclassification On the statement of cash flows for the six months ended January 31, 2021, the Company reclassified the non-cash portion of lease expense which totaled $7.2 million from Other Assets and Liabilities to Non-cash Lease Expense. This reclassification was made to the prior year balances to conform with current reporting and had no impact on net loss or stockholder’s equity.

RECENT ACCOUNTING PRONOUNCEMENT

RECENT ACCOUNTING PRONOUNCEMENTS	6 Months Ended
	Jan. 31, 2022
Accounting Policies [Abstract]
RECENT ACCOUNTING PRONOUNCEMENTS	RECENT ACCOUNTING PRONOUNCEMENTS Adoption of New Accounting Standards In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which amends the existing guidance relating to the accounting for income taxes. This ASU is intended to simplify the accounting for income taxes by removing certain exceptions to the general principles of accounting for income taxes and to improve the consistent application of U.S. GAAP for other areas of accounting for income taxes by clarifying and amending existing guidance. The new guidance was effective for the Company's first quarter of the fiscal year ending July 31, 2022 (Fiscal Year 2022). The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements. Accounting Standards Issued and Not Yet Implemented In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Loses on Financial Instruments , an ASU that requires measurement and recognition of expected credit losses for financial instruments, including trade receivables, based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The ASU will be effective for the Company beginning in the first quarter of the fiscal year ending July 31, 2024 on a modified retrospective basis, which requires a cumulative effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which is intended to provide temporary optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by the discontinuation of the London Interbank Offered Rate, known as LIBOR, or by another reference rate expected to be discontinued. This optional guidance is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40) . The amendment in this update simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments and convertible preferred stock. This update also amends the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions and requires the application of the if-converted method for calculating diluted earnings per share. The update also requires entities to provide expanded disclosures about the terms and features of convertible instruments, how the instruments have been reported in the entity's financial statements and information about events, conditions and circumstances that can affect the assessment of the amount or timing of an entity's future cash flows related to those instruments. The guidance is effective for interim and annual periods beginning in our fiscal year ending July 31, 2025, with early adoption permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements.

INVENTORIES, NET

INVENTORIES, NET	6 Months Ended
	Jan. 31, 2022
Inventory Disclosure [Abstract]
INVENTORIES, NET	INVENTORIES, NET The table below presents the components of Inventories, net: January 31, July 31, (In thousands) Raw materials $ 18,130 $ 15,484 Work-in-process 640 76 Finished goods 658 668 $ 19,428 $ 16,228

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS	6 Months Ended
	Jan. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL AND INTANGIBLE ASSETS	GOODWILL AND INTANGIBLE ASSETS The Company's goodwill of $231.5 million as of January 31, 2022 and July 31, 2021, respectively, relates to the Company's Direct Marketing reporting unit, which is the only reporting unit in the Direct Marketing reportable segment. See Note 1 for more details regarding the disposition of IWCO Direct subsequent to which the Company will no longer have any goodwill or amortizable intangible assets. The carrying value of goodwill is not amortized, but is tested for impairment annually as of June 30, and, additionally on an interim basis, whenever events or changes in circumstances indicate that the carrying value may not be recoverable. During mid-January 2022, the Company determined it would not be possible to extend or refinance the Cerberus Credit Facility and that this was an indicator of impairment of its goodwill, other intangible assets and long-lived assets for the Direct Marketing business. As a result, the Company performed an interim impairment test of IWCO Direct’s goodwill and other long-lived assets as of January 31, 2022. Based upon the terms of the Termination Agreement with Cerberus and considering prior fair values determined for the IWCO Direct reporting unit, the Company determined that the goodwill and other long-lived assets were not impaired during the three months ended January 31, 2022. Other intangible assets, net, as of January 31, 2022, include customer relationships for the Direct Marketing segment. The trademarks and tradenames intangible assets were fully amortized as of January 31, 2021. A summary of other intangible assets, net are reflected in the table below: January 31, 2022 July 31, 2021 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) (In thousands) Customer relationships 15 $ 192,730 $ 85,810 $ 106,920 $ 192,730 $ 77,725 $ 115,005 Trademarks and tradenames 3 20,520 20,520 — 20,520 20,520 — Total $ 213,250 $ 106,330 $ 106,920 $ 213,250 $ 98,245 $ 115,005 The table below presents amortization expense recorded by the Company for other intangible assets: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Customer relationships $ 3,903 $ 4,504 $ 8,085 $ 9,329 Trademarks and trade names — 855 — 2,565 Total $ 3,903 $ 5,359 $ 8,085 $ 11,894

ACCRUED EXPENSES AND OTHER CURR

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	6 Months Ended
	Jan. 31, 2022
Payables and Accruals [Abstract]
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	ACCRUED EXPENSES AND OTHER CURRENT LIABILITIESThe following tables reflect the components of "Accrued expenses" and "Other current liabilities": January 31, July 31, Accrued Expenses (In thousands) Accrued taxes $ 57,952 $ 57,152 Accrued compensation 20,428 22,987 Accrued worker's compensation 1,500 1,818 Accrued audit, tax and legal 4,042 3,674 Accrued contract labor 756 930 Accrued interest 476 476 Accrued other 19,722 19,834 $ 104,876 $ 106,871 January 31, July 31, Other Current Liabilities (In thousands) Accrued pricing liabilities $ 10,295 $ 10,295 Customer postage deposits 10,599 13,452 Other 4,700 4,354 $ 25,594 $ 28,101 As of January 31, 2022 and July 31, 2021, the Company had accrued taxes of $58.0 million and $57.2 million, respectively, which reflected the Company's estimate for certain tax related liabilities. As of both January 31, 2022 and July 31, 2021, the Company had accrued pricing liabilities of approximately $10.3 million. As previously reported by the Company, several principal adjustments were made to its historic financial statements for periods ending on or before January 31, 2012, the most significant of which related to the treatment of vendor rebates in its pricing policies. Where the retention of a rebate or a mark-up was determined to have been inconsistent with a client contract, the Company concluded that these amounts were not properly recorded as revenue. Accordingly, revenue was reduced by an equivalent amount for the period that the rebate was estimated to have been affected. A corresponding liability for the same amount was recorded in that period (referred to as accrued pricing liabilities). The Company believes that it may not ultimately be required to pay all or any of the accrued pricing liabilities based upon the expiration of statutes of limitations, and due in part to the nature of the interactions with its clients. The remaining accrued pricing liabilities as of January 31, 2022 will be derecognized when there is sufficient information for the Company to conclude that such liabilities are not subject to escheatment and have been extinguished, which may occur through payment, legal release, or other legal or factual determination. The Company has not provided for any provision for interest and or penalties related to escheatment as it has concluded that such is not probable to occur, and any potential interest and penalties cannot be reasonably estimated.

RESTRUCTURING

RESTRUCTURING	6 Months Ended
	Jan. 31, 2022
Restructuring and Related Activities [Abstract]
RESTRUCTURING	RESTRUCTURING IWCO Direct Restructuring Activities On June 2, 2021, the Board approved a Competitive Improvement Plan (“CIP”) for IWCO Direct, which addressed the changing requirements of its customers and markets it serves, as well as the current competitive landscape. The CIP contemplated a total investment of approximately $54 million primarily over a 24-month period. The Company estimated the CIP cost would consist of approximately: (1) $38 million for digital press and insertion equipment, and technology build out cost (of which approximately $34 million in lease/purchase agreements were entered into subsequent to the year ended July 31, 2021), and (2) $16 million for severance, employee retention, facilities optimization, and other implementation costs. In addition, the Company expected to incur approximately $12 million for non-cash accelerated depreciation expense. The cost estimates did not include amounts for potential non-cash asset impairment charges relating to facilities and equipment optimization. The timing and amount of the future costs incurred will depend on a number of factors. These investments are to be funded by IWCO Direct. After the IWCO Direct Disposal, the Company will have no further obligation for the CIP which had estimated future cash outflows remaining of approximately $44 million. See Note 1 for details regarding the disposition of IWCO Direct. Accelerated depreciation costs primarily relate to operating facilities and equipment to be sold or closed as part of the programs. Accelerated depreciation costs represent the difference between the depreciation expense to be recognized over the revised useful life of the asset, based upon the anticipated date the site will be closed or divested or the equipment disposed of, and depreciation expense as determined utilizing the useful life prior to the restructuring actions. As part of the CIP, the Company announced on August 23, 2021 that it will be optimizing its manufacturing footprint by closing IWCO Direct’s Little Falls, Minnesota facility. The facility closed in January of 2022. ModusLink Restructuring Activities During the fiscal year ended July 31, 2021, ModusLink implemented a strategic plan to reorganize its sales function and the e-Business operations. The restructuring charges associated with this plan were incurred during the fiscal year ended July 31, 2021 and were primarily composed of employee termination costs. In November 2021, ModusLink amended its strategic plan to include reorganizing its supply chain operations and recorded a restructuring charge of approximately $0.9 million during the three and six months ended January 31, 2022. The tables below present restructuring charges by type of cost: Three Months Ended January 31, 2022 Six Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Accelerated depreciation $ 3,700 $ — $ 3,700 $ 8,095 $ — $ 8,095 Impairment of long-lived assets — — — 70 — 70 Employee termination costs 1,386 856 2,242 3,371 856 4,227 Contractual obligations 113 — 113 308 — 308 Other 344 — 344 344 — 344 Total restructuring charges $ 5,543 $ 856 $ 6,399 $ 12,188 $ 856 $ 13,044 Three Months Ended January 31, 2022 Six Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Cost of revenue $ 5,008 $ 646 $ 5,654 $ 11,351 $ 646 $ 11,997 Selling, general and administrative 535 210 745 837 210 1,047 $ 5,543 $ 856 $ 6,399 $ 12,188 $ 856 $ 13,044 Changes to the restructuring liability during the six months ended January 31, 2022 were as follows: (in thousands) Employee Termination Costs Contractual Obligations Asset Impairment Other Restructuring Liability (In thousands) Balance as of July 31, 2021 $ 1,055 $ — $ — $ — $ 1,055 Costs incurred 4,800 199 8,165 472 13,636 Cash payments (3,759) (164) — (472) (4,395) Non-cash relief of accrual (7) — (8,165) — (8,172) Change in estimates (655) — — — (655) Balance as of January 31, 2022 $ 1,434 $ 35 $ — $ — $ 1,469

LEASES

LEASES	6 Months Ended
	Jan. 31, 2022
Leases [Abstract]
LEASES	LEASESThe table below presents the components of the Company's lease expense: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Operating lease cost $ 4,165 $ 4,131 $ 8,166 $ 8,359 Short-term lease expense 507 533 856 940 Variable lease cost 4 11 15 19 Interest on finance lease liabilities 1 1 2 3 $ 4,677 $ 4,676 $ 9,039 $ 9,321 Supplemental Cash Flow Information Supplemental cash flow information related to the Company's leases was as follows: Six Months Ended 2022 2021 (In thousands) Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 8,091 $ 8,377 Operating cash flows from finance leases $ 2 $ 3 Financing cash flows from finance leases $ 36 $ 35
LEASES	LEASESThe table below presents the components of the Company's lease expense: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Operating lease cost $ 4,165 $ 4,131 $ 8,166 $ 8,359 Short-term lease expense 507 533 856 940 Variable lease cost 4 11 15 19 Interest on finance lease liabilities 1 1 2 3 $ 4,677 $ 4,676 $ 9,039 $ 9,321 Supplemental Cash Flow Information Supplemental cash flow information related to the Company's leases was as follows: Six Months Ended 2022 2021 (In thousands) Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 8,091 $ 8,377 Operating cash flows from finance leases $ 2 $ 3 Financing cash flows from finance leases $ 36 $ 35

DEBT

DEBT	6 Months Ended
	Jan. 31, 2022
Debt Disclosure [Abstract]
DEBT	DEBT The components of debt and a reconciliation to the carrying amount of long-term debt is presented in the table below: January 31, July 31, (In thousands) Secured Cerberus Term Loan due December 15, 2022 $ 361,330 $ 364,330 Unsecured 7.50% Convertible Senior Note due March 1, 2024 14,940 14,940 Credit Facilities Cerberus Revolving Facility — — MidCap Credit Facility — — Less: unamortized discounts and issuance costs (5,131) (6,136) Total debt, net 371,139 373,134 Less: current portion of debt, net (360,996) (5,602) Total long-term debt, net $ 10,143 $ 367,532 Cerberus Term Loan On February 25, 2022, Company transferred all of its interests in IWCO Direct to the Buyer as part of a negotiated restructuring of the capital structure and certain financial obligations of IWCO Direct which included the Cerberus Term Loan which will be derecognized upon deconsolidation. See Note 1 for more details regarding the IWCO Direct Disposal. 7.50% Convertible Senior Note On February 28, 2019, the Company entered into a 7.50% Convertible Senior Note Due 2024 Purchase Agreement (the "SPHG Note Purchase Agreement") with SPH Group Holdings LLC ("SPHG Holdings"), whereby SPHG Holdings agreed to loan the Company $14.9 million in exchange for a 7.50% Convertible Senior Note due 2024 (the "SPHG Note"). SPHG Holdings has the right, at its option, prior to the close of business on the business day immediately preceding the SPHG Note Maturity Date, to convert the SPHG Note or a portion thereof that is $1,000 or an integral multiple thereof, into shares of common stock (if the Company has not received a required stockholder approval) or cash, shares of common stock or a combination of cash and shares of common stock, as applicable (if the Company has received a required stockholder approval), at an initial conversion rate of 421.2655 shares of common stock, which is equivalent to an initial conversion price of approximately $2.37 per share (subject to adjustment as provided in the SPHG Note) per $1,000 principal amount of the SPHG Note, subject to, and in accordance with, the settlement provisions of the SPHG Note. As of January 31, 2022, the if-converted value of the SPHG Note did not exceed the principal value of the SPHG Note. As of January 31, 2022, the remaining period over which the unamortized discount will be amortized is 25 months. As of January 31, 2022 and July 31, 2021, the net carrying value of the SPHG Note was $10.1 million and $9.3 million, respectively. The effective interest rate on the SPHG Note, including accretion of the discount, is 27.8%. The following tables reflect the components of the SPHG Note: January 31, July 31, (In thousands) Carrying amount of equity component $ 8,200 $ 8,200 Principal amount of note $ 14,940 $ 14,940 Unamortized debt discount (4,797) (5,597) Net carrying amount $ 10,143 $ 9,343 Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Interest expense related to contractual interest coupon $ 286 $ 287 $ 572 $ 573 Interest expense related to accretion of the discount 414 313 800 605 $ 700 $ 600 $ 1,372 $ 1,178 On March 16, 2022, ModusLink, as borrower, entered into a new credit agreement with Umpqua Bank (the “Umpqua Revolver”), as lender and as agent. The Umpqua Revolver provides for a maximum credit commitment of $12.5 million and a sublimit of $5.0 million for letters of credit and expires on March 16, 2024. Concurrent with signing the Umpqua Revolver, ModusLink submitted a notice of termination to MidCap for its MidCap Credit Agreement which was set to expire on December 31, 2022. ModusLink believes it will remain in compliance with the Umpqua Revolver’s covenants for the next twelve months.

CONTINGENCIES

CONTINGENCIES	6 Months Ended
	Jan. 31, 2022
Commitments and Contingencies Disclosure [Abstract]
CONTINGENCIES	CONTINGENCIES On April 13, 2018, a purported shareholder, Donald Reith, filed a verified complaint, Reith v. Lichtenstein, et al., 2018-277 (Del. Ch.) in the Delaware Court of Chancery. The complaint alleges class and derivative claims for breach of fiduciary duty and/or aiding and abetting breach of fiduciary duty and unjust enrichment against the Board, Warren G. Lichtenstein, Glen M. Kassan, William T. Fejes, Jack L. Howard, Jeffrey J. Fenton, Philip E. Lengyel and Jeffrey S. Wald; and stockholders Steel Holdings, Steel Partners, Ltd., SPHG Holdings, Handy & Harman Ltd. ("Handy & Harman") and WHX CS Corp. (collectively, the "Steel Parties") in connection with the acquisition of $35.0 million of the Series C Convertible Preferred Stock by SPHG Holdings and equity grants made to Messrs. Lichtenstein, Howard and Fejes on December 15, 2017 (collectively, the "Challenged Transactions"). The Company is named as a nominal defendant. The complaint alleges that although the Challenged Transactions were approved by a Special Committee consisting of the independent members of the Board (Messrs. Fenton, Lengyel and Wald), the Steel Parties dominated and controlled the Special Committee, who approved the Challenged Transactions in breach of their fiduciary duty. Plaintiff alleges that the Challenged Transactions unfairly diluted shareholders and therefore unjustly enriched Steel Holdings, SPHG Holdings and Messrs. Lichtenstein, Howard and Fejes. The complaint also alleges that the Board made misleading disclosures in the Company's proxy statement for the 2017 Annual Meeting of Stockholders in connection with seeking approval to amend the 2010 Incentive Award Plan to authorize the issuance of additional shares to accommodate certain shares underlying the equity grants. Remedies requested include rescission of the Series C Convertible Preferred Stock and equity grants, disgorgement of any unjustly obtained property or compensation and monetary damages. On June 8, 2018, defendants moved to dismiss the complaint for failure to plead demand futility and failure to state a claim. On June 28, 2019, the Court denied most of the motion to dismiss allowing the matter to proceed. On August 13, 2021, the Company, together with certain of its current and former directors of the Board, Warren Lichtenstein, Glen Kassan, William Fejes, Jr., Jack Howard, Jeffrey Fenton and Jeffrey Wald, as well as other named defendants (collectively, the “Defendants”), entered into a memorandum of understanding (the “MOU”) with Donald Reith (the “Plaintiff”) in connection with the settlement of the Reith v. Lichtenstein, et al., C.A. No. 2018-0277-MTZ (Del. Ch. 2018) class and derivative action. Pursuant to the MOU, the Defendants agreed to cause their directors’ and officers’ liability insurance carriers to pay to the Company $2.75 million in cash. The payment shall be paid into an escrow account within 14 business days of the later of (i) the entry of the scheduling order in connection with the stipulation of the settlement; or (ii) the date on which Plaintiff’s counsel provides to the Defendants’ counsel written payment and wire instructions. Additionally, under the MOU and separate letter agreements between the Company and such individuals (the “Surrender Agreements”), Messrs. Lichtenstein, Howard and Fejes agreed to surrender to the Company an aggregate 3.3 million shares which they had initially received in December 2017 in consideration for services to the Company. The surrenders and cancellations are in the following amounts: for Mr. Lichtenstein, 1,833,333 vested shares and 300,000 unvested shares; for Mr. Howard, 916,667 vested shares and 150,000 unvested shares; and for Mr. Fejes, 100,000 vested shares. Such amounts are to be adjusted to give effect to the one-for-ten reverse stock split voted on by the Company’s shareholders at the annual meeting on July 26, 2021 (if such reverse stock split is effected prior to the surrender of such shares). The surrenders and cancellations shall be completed no later than seven calendar days following final approval of the settlement by the court and the exhaustion of any appeals therefrom or the expiration of time to appeal. On August 17, 2021, Mr. Lichtenstein and Mr. Howard surrendered the shares required under their respective Surrender Agreements and all such shares were subsequently cancelled. Pursuant to the MOU, the Company has also agreed to pay the Plaintiff’s counsel legal fees for this matter. The settlement requires court approval, and there can be no assurances that such approval will be granted. On February 18, 2022, the parties filed a Stipulation of Settlement, proposed notice to stockholders, proposed scheduling order, and proposed form of final judgment (collectively, the “Stipulation”), setting forth the settlement terms previously set forth in the MOU. In addition, the Stipulation reflects the parties’ agreement that the amount of the legal fees for which Plaintiffs’ counsel would apply, and that the Company would pay if approved by the court, would be $2.05 million. The court has not yet entered the scheduling order establishing the date on which a hearing would be held concerning approval of the settlement.

REVENUE RECOGNITION

REVENUE RECOGNITION	6 Months Ended
	Jan. 31, 2022
Revenue from Contract with Customer [Abstract]
REVENUE RECOGNITION	REVENUE RECOGNITION Disaggregation of Revenue The following table presents the Company's revenues from contracts with customers disaggregated by major good or service line and timing of revenue recognition. The table also includes a reconciliation of the disaggregated revenue with the reportable segments. Three Months Ended January 31, 2022 Three Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Major Goods/Service Lines Marketing solutions offerings $ 66,316 $ — $ 66,316 $ 91,155 $ — $ 91,155 Supply chain management services — 53,719 53,719 — 64,342 64,342 Other — 603 603 — 550 550 $ 66,316 $ 54,322 $ 120,638 $ 91,155 $ 64,892 $ 156,047 Timing of Revenue Recognition Goods transferred over time $ 66,316 $ — $ 66,316 $ 91,155 $ — $ 91,155 Services transferred over time — 54,322 54,322 — 64,892 64,892 $ 66,316 $ 54,322 $ 120,638 $ 91,155 $ 64,892 $ 156,047 Six Months Ended January 31, 2022 Six Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Major Goods/Service Lines Marketing solutions offerings $ 147,375 $ — $ 147,375 $ 196,863 $ — $ 196,863 Supply chain management services — 97,661 97,661 — 128,129 128,129 Other — 1,015 1,015 — 989 989 $ 147,375 $ 98,676 $ 246,051 $ 196,863 $ 129,118 $ 325,981 Timing of Revenue Recognition Goods transferred over time $ 147,375 $ — $ 147,375 $ 196,863 $ — $ 196,863 Services transferred over time — 98,676 98,676 — 129,118 129,118 $ 147,375 $ 98,676 $ 246,051 $ 196,863 $ 129,118 $ 325,981 Marketing Solutions Offerings IWCO Direct's revenue is generated through the provision of data-driven marketing solutions, primarily through providing direct mail products to customers. Revenue related to the majority of IWCO Direct's marketing solutions contracts, which typically consist of a single integrated performance obligation, is recognized over time as the Company performs because the products have no alternative use to the Company. Supply Chain Management Services ModusLink's revenue primarily comes from the sale of supply chain management services to its clients. Amounts billed to customers under these arrangements include revenue attributable to the services performed as well as for materials procured on the customer's behalf as part of its service to them. The majority of these arrangements consist of two distinct performance obligations (i.e., warehousing/inventory management service and a separate kitting/packaging/assembly service), revenue related to each of which is recognized over time as services are performed using an input method based on the level of efforts expended. Other Other revenue consists of cloud-based software subscriptions, software maintenance and support service contracts, and fees for professional services. Revenue related to these arrangements is recognized on a straight-line basis over the term of the agreement or over the term of the agreement in proportion to the costs incurred in satisfying the obligations under the contract. Contract Balances Timing of revenue recognition may differ from timing of invoicing to customers. The Company records contract assets and liabilities related to its contracts with customers as follows: • Accounts receivable when revenue is recognized prior to receipt of cash payments and if the right to such amounts is unconditional and solely based on the passage of time. • Contract asset when the Company recognizes revenue based on efforts expended but the right to such amount is conditional upon satisfaction of another performance obligation. Contract assets are primarily comprised of fees related to marketing solutions offerings and supply chain management services. The Company's contract assets are all short-term in nature and are included in prepaid expenses and other current assets in the condensed consolidated balance sheets. • Deferred revenue when cash payments are received or due in advance of performance. Deferred revenue is primarily comprised of fees related to supply chain management services, cloud-based software subscriptions and software maintenance and support service contracts, which are generally billed in advance. Deferred revenue also includes other offerings for which we have been paid in advance and earn the revenue when we transfer control of the product or service. The deferred revenue balance is classified as a component of other current liabilities and other long-term liabilities on the Company's condensed consolidated balance sheets. The table below presents information for the Company's contract balances: January 31, July 31, (In thousands) Accounts receivable, trade, net $ 68,971 $ 69,805 Contract assets $ 10,530 $ 14,458 Deferred revenue - current $ 3,560 $ 2,562 Deferred revenue - long-term 85 108 Total deferred revenue $ 3,645 $ 2,670 Remaining Performance Obligations Remaining performance obligations are comprised of deferred revenue. Changes in deferred revenue during the six months ended January 31, 2022 and January 31, 2021, were as follows: Six Months Ended 2022 2021 (In thousands) Balance at beginning of period $ 2,670 $ 2,945 Deferral of revenue 1,959 4,417 Recognition of deferred amounts upon satisfaction of performance obligation (984) (1,868) Balance at end of period $ 3,645 $ 5,494 We expect to recognize approximately $3.3 million of the Supply Chain deferred revenue over the next twelve months and the remaining $0.1 million beyond that time period. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

INCOME TAXES

INCOME TAXES	6 Months Ended
	Jan. 31, 2022
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES The Company operates in multiple taxing jurisdictions, both within and outside of the United States. For the six months ended January 31, 2022, the Company was profitable in certain jurisdictions, resulting in an income tax expense using enacted rates in those jurisdictions. As of both January 31, 2022 and July 31, 2021, the total amount of the liability for unrecognized tax benefits related to federal, state and foreign taxes was approximately $2.5 million. On March 27, 2020, the President of the United States signed the Coronavirus Aid, Relief, and Economic Security ("CARES") Act into law, which is intended to respond to the COVID-19 pandemic and its impact on the economy, public health, state and local governments, individuals and businesses. The CARES Act contains numerous tax provisions, including temporary changes to the future limitations on interest deductions related to Section 163(j) of the U.S. Internal Revenue Code (the “IRC”). The Company elected to defer the employer-paid portion of social security taxes, which is expected to provide the Company with approximately $5.3 million of additional liquidity during calendar 2021 and calendar 2022. During the prior calendar year 50% of the deferral was due December 31, 2021 and the remaining 50% will be due December 31, 2022. The Company does not expect the provisions of the CARES Act to have a significant impact on the income tax provision, income tax payable or deferred income tax positions of the Company. Uncertain Tax Positions In accordance with the Company's accounting policy, interest related to unrecognized tax benefits is included in the income tax expense line of the condensed consolidated statements of operations. As of January 31, 2022 and July 31, 2021, the liabilities for interest expense related to uncertain tax positions were $0.4 million and $0.3 million, respectively. The Company has accrued $0.4 million for penalties related to income tax positions. The Company expects $0.7 million of unrecognized tax benefits and related interest to reverse in the next twelve months. The Company is subject to U.S. federal income tax and various state, local and international income taxes in numerous jurisdictions. The federal and state tax returns are generally subject to tax examinations for the tax years ended July 31, 2018 through July 31, 2021. To the extent the Company has tax attribute carryforwards, the tax year in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state tax authorities to the extent utilized in a future period. In addition, a number of tax years remain subject to examination by the appropriate government agencies for certain countries in the Europe and Asia regions. In Europe, the Company's 2013 through 2020 tax years remain subject to examination in most locations, while the Company's 2009 through 2020 tax years remain subject to examination in most Asia locations.

LOSS PER SHARE

LOSS PER SHARE	6 Months Ended
	Jan. 31, 2022
Earnings Per Share [Abstract]
LOSS PER SHARE	LOSS PER SHARE The following table reconciles loss per share for the three and six months ended January 31, 2022 and 2021: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands, except per share data) Net loss $ (22,977) $ (2,196) $ (42,471) $ (5,747) Less: Preferred dividends on redeemable preferred stock (537) (530) (1,074) (1,067) Net loss attributable to common stockholders $ (23,514) $ (2,726) $ (43,545) $ (6,814) Weighted average common shares used in basic and diluted loss per share 59,748 62,028 60,027 61,961 Basic and diluted net loss per share attributable to common stockholders $ (0.39) $ (0.04) $ (0.73) $ (0.11) Basic net loss per common share is calculated using the weighted average number of common shares outstanding during the period. Diluted net earnings per common share, if any, gives effect to diluted stock options (calculated based on the treasury stock method), non-vested restricted stock shares purchased under the employee stock purchase plan and shares issuable upon debt or preferred stock conversion (calculated using an as-if converted method). For the three months ended January 31, 2022 and 2021, approximately 24.2 million and 24.2 million, respectively, common stock equivalent shares (including those related to convertible debt and preferred stock) were excluded from the denominator in the calculation of diluted net loss per share as their inclusion would have been antidilutive. For the six months ended January 31, 2022 and 2021, approximately 24.2 million and 24.2 million, respectively, common stock equivalent shares (including those related to convertible debt and preferred stock) were excluded from the denominator in the calculation of diluted net loss per share as their inclusion would have been antidilutive.

COMPREHENSIVE INCOME (LOSS)

COMPREHENSIVE INCOME (LOSS)	6 Months Ended
	Jan. 31, 2022
Equity [Abstract]
COMPREHENSIVE INCOME (LOSS)	COMPREHENSIVE INCOME (LOSS) Comprehensive income (loss) combines net income (loss) and other comprehensive items. Other comprehensive items represent certain amounts that are reported as components of stockholders' equity in the accompanying condensed consolidated balance sheets. Accumulated other comprehensive items consist of the following: Foreign Pension Total (In thousands) Accumulated other comprehensive income (loss) as of July 31, 2021 $ 9,762 $ (2,600) $ 7,162 Foreign currency translation adjustment 185 — 185 Net current-period other comprehensive income 185 — 185 Accumulated other comprehensive income (loss) as of January 31, 2022 $ 9,947 $ (2,600) $ 7,347 Foreign Pension Total (In thousands) Accumulated other comprehensive income (loss) as of July 31, 2020 $ 5,025 $ (1,182) $ 3,843 Foreign currency translation adjustment 5,393 — 5,393 Net current-period other comprehensive income 5,393 — 5,393 Accumulated other comprehensive income (loss) as of January 31, 2021 $ 10,418 $ (1,182) $ 9,236

SEGMENT INFORMATION

SEGMENT INFORMATION	6 Months Ended
	Jan. 31, 2022
Segment Reporting [Abstract]
SEGMENT INFORMATION	SEGMENT INFORMATION The Company had two operating segments which are the same as its reportable segments: Direct Marketing and Supply Chain. See Note 1 for details regarding the disposition of Direct Marketing segment. The Company also has Corporate-level activity, which consists primarily of costs associated with certain corporate administrative functions such as legal, finance and share-based compensation, which are not allocated to the Company's reportable segments. The Corporate-level balance sheet information includes cash and cash equivalents, debt and other assets and liabilities which are not identifiable to the operations of the Company's operating segments. All significant intra-segment amounts have been eliminated. Management evaluates segment performance based on segment net revenue and operating income (loss). Summarized financial information by operating segment is as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Net revenue: Direct Marketing $ 66,316 $ 91,155 $ 147,375 $ 196,863 Supply Chain 54,322 64,892 98,676 129,118 $ 120,638 $ 156,047 $ 246,051 $ 325,981 Operating (loss) income: Direct Marketing $ (14,262) $ 5,769 $ (25,740) $ 10,706 Supply Chain 2,374 4,957 4,347 10,108 Total segment operating (loss) income (11,888) 10,726 (21,393) 20,814 Corporate-level activity (2,323) (2,045) (3,725) (5,058) Total operating (loss) income (14,211) 8,681 (25,118) 15,756 Total other expense, net (8,043) (9,986) (16,315) (19,808) Loss before income taxes $ (22,254) $ (1,305) $ (41,433) $ (4,052) January 31, July 31, (In thousands) Total assets: Direct Marketing $ 476,374 $ 530,944 Supply Chain 102,748 101,159 Sub-total—segment assets 579,122 632,103 Corporate 43,562 44,278 $ 622,684 $ 676,381 Summarized financial information of the Company's net revenue from external customers by group of services is as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Products: Direct Marketing $ 66,316 $ 91,155 $ 147,375 $ 196,863 Services: Supply Chain 54,322 64,892 98,676 129,118 $ 120,638 $ 156,047 $ 246,051 $ 325,981 Summarized financial information of the Company's net revenue by geographic location is as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) United States $ 80,022 $ 108,280 $ 171,528 $ 229,763 China 19,423 22,409 35,389 42,049 Netherlands 6,227 5,387 11,876 13,182 Other 14,966 19,971 27,258 40,987 $ 120,638 $ 156,047 $ 246,051 $ 325,981

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jan. 31, 2022
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS As of January 31, 2022, SPHG Holdings and its affiliates, including Steel Holdings, Handy & Harman Ltd. and Steel Partners Ltd., beneficially owned approximately 53.4% of our outstanding capital stock, including the if-converted value of the SPHG Note and shares of Series C Convertible Preferred Stock that vote on an as-converted basis together with our common stock. Warren G. Lichtenstein, our Interim Chief Executive Officer and the Executive Chairman of our Board, is also the Executive Chairman of Steel Holdings GP Inc. ("Steel Holdings GP"), the manager of Steel Holdings. Jack L. Howard, the President and a director of Steel Holdings GP, was appointed to the Board upon the closing of the Preferred Stock Transaction described below. SPHG Note Transaction On February 28, 2019, the Company entered into a SPHG Note Purchase Agreement with SPHG Holdings, whereby SPHG Holdings agreed to loan the Company $14.9 million in exchange for the SPHG Note. As of both January 31, 2022 and July 31, 2021, SPHG Holdings held $14.9 million principal amount of the SPHG Note. As of January 31, 2022 and July 31, 2021, the net carrying value of the SPHG Note was $10.1 million and $9.3 million, respectively. Preferred Stock Transaction On December 15, 2017, the Company entered into a Preferred Stock Purchase Agreement with SPHG Holdings, pursuant to which the Company issued 35,000 shares of the Company's newly created Series C Convertible Preferred Stock to SPHG Holdings at a price of $1,000 per share, for an aggregate purchase consideration of $35.0 million. The terms, rights, obligations and preferences of the Series C Convertible Preferred Stock are set forth in the Series C Certificate of Designations, which has been filed with the Secretary of State of the State of Delaware. Management Services Agreement On June 14, 2019, the Company entered into an agreement (the "Management Services Agreement") with Steel Services Ltd. ("Steel Services"), an indirect wholly-owned subsidiary of Steel Holdings. The Management Services Agreement was effective as of June 1, 2019. In connection with the IWCO Direct Disposal, the Management Services Agreement monthly fee was reduced effective on the disposal date for the portion of the fee attributable to IWCO Direct.. Total expenses incurred related to the Management Services Agreement for the three months ended January 31, 2022 and 2021 were $0.9 million and $0.9 million, respectively. Total expenses incurred related to the Management Services Agreement for the six months ended January 31, 2022 and 2021 were $1.8 million and $2.5 million, respectively. As of January 31, 2022 and July 31, 2021, amounts due to Steel Services were $0.7 million and $0.9 million, respectively.

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	6 Months Ended
	Jan. 31, 2022
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	FAIR VALUE MEASUREMENTS ASC 820 provides that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820 requires the Company to use valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs Level 3: Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants would price the assets or liabilities The carrying value of cash and cash equivalents, accounts receivable, restricted cash, accounts payable, current liabilities and the revolving line of credit approximate fair value because of the short maturity of these instruments. We believe that the carrying value of our long-term debt approximates fair value because the stated interest rates of this debt is consistent with current market rates. The carrying value of capital lease obligations approximates fair value, as estimated by using discounted future cash flows based on the Company's current incremental borrowing rates for similar types of borrowing arrangements. Assets and Liabilities that are Measured at Fair Value on a Recurring Basis The following tables present the Company's financial assets measured at fair value on a recurring basis as of January 31, 2022 and July 31, 2021, classified by fair value hierarchy: Fair Value Measurements at Reporting Date Using (In thousands) January 31, 2022 Level 1 Level 2 Level 3 Assets: Money market funds $ 41,326 $ 41,326 $ — $ — Fair Value Measurements at Reporting Date Using (In thousands) July 31, 2021 Level 1 Level 2 Level 3 Assets: Money market funds $ 42,327 $ 42,327 $ — $ — There were no transfers between Levels 1, 2 or 3 during any of the periods presented. When available, quoted prices are used to determine fair value. When quoted prices in active markets are available, investments are classified within Level 1 of the fair value hierarchy. When quoted prices in active markets are not available, fair values are determined using pricing models, and the inputs to those pricing models are based on observable market inputs. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others. Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis The Company reviews the carrying amounts of these assets whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. An impairment loss is recognized when the carrying amount of the asset group or reporting unit is not recoverable and exceeds its fair value. The Company estimates the fair values of assets subject to impairment based on the Company's own judgments about the assumptions that market participants would use in pricing the assets and on observable market data, when available. Fair Value of Financial Instruments The Company's financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, customer deposits, accounts payable, restricted cash and debt, and are reflected in the consolidated financial statements at carrying value. With the exception of the SPHG Note and long-term debt, carrying value approximates fair value for these items due to their short-term nature. The Company believes that the carrying value of the liability component of the SPHG Note and our long-term debt approximates fair value because the stated interest rates of this debt is consistent with current market rates. Included in cash and cash equivalents in the accompanying condensed consolidated balance sheets are money market funds. These are valued at quoted market prices in active markets.

RECENT ACCOUNTING PRONOUNCEME_2

RECENT ACCOUNTING PRONOUNCEMENTS (Policies)	6 Months Ended
	Jan. 31, 2022
Accounting Policies [Abstract]
Basis of Accounting	The accompanying condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of a normal recurring nature) considered necessary for fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes for the year ended July 31, 2021 (Fiscal Year 2021), which are contained in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission on October 29, 2021, as amended on November 30, 2021 (the "2021 Annual Report'). The results for the six months ended January 31, 2022 are not necessarily indicative of the results to be expected for the full fiscal year. The year-end condensed consolidated balance sheet data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP.
Consolidation	All significant intercompany transactions and balances have been eliminated in consolidation.
Reclassification, Comparability Adjustment	Reclassification On the statement of cash flows for the six months ended January 31, 2021, the Company reclassified the non-cash portion of lease expense which totaled $7.2 million from Other Assets and Liabilities to Non-cash Lease Expense. This reclassification was made to the prior year balances to conform with current reporting and had no impact on net loss or stockholder’s equity.
Adoption of New Accounting Standards and Accounting Standards Issued and Not Yet Implemented	Adoption of New Accounting Standards In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, which amends the existing guidance relating to the accounting for income taxes. This ASU is intended to simplify the accounting for income taxes by removing certain exceptions to the general principles of accounting for income taxes and to improve the consistent application of U.S. GAAP for other areas of accounting for income taxes by clarifying and amending existing guidance. The new guidance was effective for the Company's first quarter of the fiscal year ending July 31, 2022 (Fiscal Year 2022). The adoption of this new guidance did not have a material impact on the Company's consolidated financial statements. Accounting Standards Issued and Not Yet Implemented In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Loses on Financial Instruments , an ASU that requires measurement and recognition of expected credit losses for financial instruments, including trade receivables, based on historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. The ASU will be effective for the Company beginning in the first quarter of the fiscal year ending July 31, 2024 on a modified retrospective basis, which requires a cumulative effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which is intended to provide temporary optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by the discontinuation of the London Interbank Offered Rate, known as LIBOR, or by another reference rate expected to be discontinued. This optional guidance is effective beginning on March 12, 2020, and the Company may elect to apply the amendments prospectively through December 31, 2022. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements. In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40) . The amendment in this update simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments and convertible preferred stock. This update also amends the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions and requires the application of the if-converted method for calculating diluted earnings per share. The update also requires entities to provide expanded disclosures about the terms and features of convertible instruments, how the instruments have been reported in the entity's financial statements and information about events, conditions and circumstances that can affect the assessment of the amount or timing of an entity's future cash flows related to those instruments. The guidance is effective for interim and annual periods beginning in our fiscal year ending July 31, 2025, with early adoption permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements.
Fair Value of Financial Instruments	ASC 820 provides that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820 requires the Company to use valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs Level 3: Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants would price the assets or liabilities The carrying value of cash and cash equivalents, accounts receivable, restricted cash, accounts payable, current liabilities and the revolving line of credit approximate fair value because of the short maturity of these instruments. We believe that the carrying value of our long-term debt approximates fair value because the stated interest rates of this debt is consistent with current market rates. The carrying value of capital lease obligations approximates fair value, as estimated by using discounted future cash flows based on the Company's current incremental borrowing rates for similar types of borrowing arrangements.

Organization, Consolidation and

Organization, Consolidation and Presentation of Financial Statements (Tables)	6 Months Ended
	Jan. 31, 2022
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Business acquisition, pro forma information	The following table summarizes the Company’s unaudited pro forma financial information for the six months ended January 31, 2022 and the fiscal year ended July 31, 2021 as if the IWCO Direct Disposal occurred on August 1, 2020. Six Months Ended January 31, Fiscal Year Ended July 31, (In thousands) Net revenue $ 98,676 $ 226,256 Cost of revenue $ 78,369 $ 178,552 Operating income (loss) $ 622 $ (1,569)

INVENTORIES, NET (Tables)

INVENTORIES, NET (Tables)	6 Months Ended
	Jan. 31, 2022
Inventory Disclosure [Abstract]
Schedule of inventories, net	The table below presents the components of Inventories, net: January 31, July 31, (In thousands) Raw materials $ 18,130 $ 15,484 Work-in-process 640 76 Finished goods 658 668 $ 19,428 $ 16,228

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS (Tables)	6 Months Ended
	Jan. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of finite-lived intangible assets	A summary of other intangible assets, net are reflected in the table below: January 31, 2022 July 31, 2021 Weighted Average Amortization Period Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount (in years) (In thousands) Customer relationships 15 $ 192,730 $ 85,810 $ 106,920 $ 192,730 $ 77,725 $ 115,005 Trademarks and tradenames 3 20,520 20,520 — 20,520 20,520 — Total $ 213,250 $ 106,330 $ 106,920 $ 213,250 $ 98,245 $ 115,005
Finite-lived intangible assets amortization expense	The table below presents amortization expense recorded by the Company for other intangible assets: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Customer relationships $ 3,903 $ 4,504 $ 8,085 $ 9,329 Trademarks and trade names — 855 — 2,565 Total $ 3,903 $ 5,359 $ 8,085 $ 11,894

ACCRUED EXPENSES AND OTHER CU_2

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)	6 Months Ended
	Jan. 31, 2022
Payables and Accruals [Abstract]
Components of accrued expenses	The following tables reflect the components of "Accrued expenses" and "Other current liabilities": January 31, July 31, Accrued Expenses (In thousands) Accrued taxes $ 57,952 $ 57,152 Accrued compensation 20,428 22,987 Accrued worker's compensation 1,500 1,818 Accrued audit, tax and legal 4,042 3,674 Accrued contract labor 756 930 Accrued interest 476 476 Accrued other 19,722 19,834 $ 104,876 $ 106,871
Components of other current liabilities	January 31, July 31, Other Current Liabilities (In thousands) Accrued pricing liabilities $ 10,295 $ 10,295 Customer postage deposits 10,599 13,452 Other 4,700 4,354 $ 25,594 $ 28,101

RESTRUCTURING (Tables)

RESTRUCTURING (Tables)	6 Months Ended
	Jan. 31, 2022
Restructuring and Related Activities [Abstract]
Schedule of restructuring and related costs	The tables below present restructuring charges by type of cost: Three Months Ended January 31, 2022 Six Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Accelerated depreciation $ 3,700 $ — $ 3,700 $ 8,095 $ — $ 8,095 Impairment of long-lived assets — — — 70 — 70 Employee termination costs 1,386 856 2,242 3,371 856 4,227 Contractual obligations 113 — 113 308 — 308 Other 344 — 344 344 — 344 Total restructuring charges $ 5,543 $ 856 $ 6,399 $ 12,188 $ 856 $ 13,044 Three Months Ended January 31, 2022 Six Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Cost of revenue $ 5,008 $ 646 $ 5,654 $ 11,351 $ 646 $ 11,997 Selling, general and administrative 535 210 745 837 210 1,047 $ 5,543 $ 856 $ 6,399 $ 12,188 $ 856 $ 13,044 Changes to the restructuring liability during the six months ended January 31, 2022 were as follows: (in thousands) Employee Termination Costs Contractual Obligations Asset Impairment Other Restructuring Liability (In thousands) Balance as of July 31, 2021 $ 1,055 $ — $ — $ — $ 1,055 Costs incurred 4,800 199 8,165 472 13,636 Cash payments (3,759) (164) — (472) (4,395) Non-cash relief of accrual (7) — (8,165) — (8,172) Change in estimates (655) — — — (655) Balance as of January 31, 2022 $ 1,434 $ 35 $ — $ — $ 1,469

LEASES (Tables)

LEASES (Tables)	6 Months Ended
	Jan. 31, 2022
Leases [Abstract]
Lease cost	The table below presents the components of the Company's lease expense: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Operating lease cost $ 4,165 $ 4,131 $ 8,166 $ 8,359 Short-term lease expense 507 533 856 940 Variable lease cost 4 11 15 19 Interest on finance lease liabilities 1 1 2 3 $ 4,677 $ 4,676 $ 9,039 $ 9,321 Supplemental cash flow information related to the Company's leases was as follows: Six Months Ended 2022 2021 (In thousands) Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 8,091 $ 8,377 Operating cash flows from finance leases $ 2 $ 3 Financing cash flows from finance leases $ 36 $ 35

DEBT (Tables)

DEBT (Tables)	6 Months Ended
	Jan. 31, 2022
Debt Disclosure [Abstract]
Components of debt and reconciliation	The components of debt and a reconciliation to the carrying amount of long-term debt is presented in the table below: January 31, July 31, (In thousands) Secured Cerberus Term Loan due December 15, 2022 $ 361,330 $ 364,330 Unsecured 7.50% Convertible Senior Note due March 1, 2024 14,940 14,940 Credit Facilities Cerberus Revolving Facility — — MidCap Credit Facility — — Less: unamortized discounts and issuance costs (5,131) (6,136) Total debt, net 371,139 373,134 Less: current portion of debt, net (360,996) (5,602) Total long-term debt, net $ 10,143 $ 367,532
Net carrying value of SPG note	The following tables reflect the components of the SPHG Note: January 31, July 31, (In thousands) Carrying amount of equity component $ 8,200 $ 8,200 Principal amount of note $ 14,940 $ 14,940 Unamortized debt discount (4,797) (5,597) Net carrying amount $ 10,143 $ 9,343 Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Interest expense related to contractual interest coupon $ 286 $ 287 $ 572 $ 573 Interest expense related to accretion of the discount 414 313 800 605 $ 700 $ 600 $ 1,372 $ 1,178

REVENUE RECOGNITION (Tables)

REVENUE RECOGNITION (Tables)	6 Months Ended
	Jan. 31, 2022
Revenue from Contract with Customer [Abstract]
Summary of reconciliation of the disaggregated revenue	The following table presents the Company's revenues from contracts with customers disaggregated by major good or service line and timing of revenue recognition. The table also includes a reconciliation of the disaggregated revenue with the reportable segments. Three Months Ended January 31, 2022 Three Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Major Goods/Service Lines Marketing solutions offerings $ 66,316 $ — $ 66,316 $ 91,155 $ — $ 91,155 Supply chain management services — 53,719 53,719 — 64,342 64,342 Other — 603 603 — 550 550 $ 66,316 $ 54,322 $ 120,638 $ 91,155 $ 64,892 $ 156,047 Timing of Revenue Recognition Goods transferred over time $ 66,316 $ — $ 66,316 $ 91,155 $ — $ 91,155 Services transferred over time — 54,322 54,322 — 64,892 64,892 $ 66,316 $ 54,322 $ 120,638 $ 91,155 $ 64,892 $ 156,047 Six Months Ended January 31, 2022 Six Months Ended January 31, 2021 Direct Supply Chain Consolidated Direct Supply Chain Consolidated (In thousands) Major Goods/Service Lines Marketing solutions offerings $ 147,375 $ — $ 147,375 $ 196,863 $ — $ 196,863 Supply chain management services — 97,661 97,661 — 128,129 128,129 Other — 1,015 1,015 — 989 989 $ 147,375 $ 98,676 $ 246,051 $ 196,863 $ 129,118 $ 325,981 Timing of Revenue Recognition Goods transferred over time $ 147,375 $ — $ 147,375 $ 196,863 $ — $ 196,863 Services transferred over time — 98,676 98,676 — 129,118 129,118 $ 147,375 $ 98,676 $ 246,051 $ 196,863 $ 129,118 $ 325,981
Summary of changes in deferred revenue	The table below presents information for the Company's contract balances: January 31, July 31, (In thousands) Accounts receivable, trade, net $ 68,971 $ 69,805 Contract assets $ 10,530 $ 14,458 Deferred revenue - current $ 3,560 $ 2,562 Deferred revenue - long-term 85 108 Total deferred revenue $ 3,645 $ 2,670 Remaining Performance Obligations Remaining performance obligations are comprised of deferred revenue. Changes in deferred revenue during the six months ended January 31, 2022 and January 31, 2021, were as follows: Six Months Ended 2022 2021 (In thousands) Balance at beginning of period $ 2,670 $ 2,945 Deferral of revenue 1,959 4,417 Recognition of deferred amounts upon satisfaction of performance obligation (984) (1,868) Balance at end of period $ 3,645 $ 5,494

LOSS PER SHARE (Tables)

LOSS PER SHARE (Tables)	6 Months Ended
	Jan. 31, 2022
Earnings Per Share [Abstract]
Reconciliation of (loss) earnings per share	The following table reconciles loss per share for the three and six months ended January 31, 2022 and 2021: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands, except per share data) Net loss $ (22,977) $ (2,196) $ (42,471) $ (5,747) Less: Preferred dividends on redeemable preferred stock (537) (530) (1,074) (1,067) Net loss attributable to common stockholders $ (23,514) $ (2,726) $ (43,545) $ (6,814) Weighted average common shares used in basic and diluted loss per share 59,748 62,028 60,027 61,961 Basic and diluted net loss per share attributable to common stockholders $ (0.39) $ (0.04) $ (0.73) $ (0.11)

COMPREHENSIVE INCOME (LOSS) (Ta

COMPREHENSIVE INCOME (LOSS) (Tables)	6 Months Ended
	Jan. 31, 2022
Equity [Abstract]
Accumulated other comprehensive items	Accumulated other comprehensive items consist of the following: Foreign Pension Total (In thousands) Accumulated other comprehensive income (loss) as of July 31, 2021 $ 9,762 $ (2,600) $ 7,162 Foreign currency translation adjustment 185 — 185 Net current-period other comprehensive income 185 — 185 Accumulated other comprehensive income (loss) as of January 31, 2022 $ 9,947 $ (2,600) $ 7,347 Foreign Pension Total (In thousands) Accumulated other comprehensive income (loss) as of July 31, 2020 $ 5,025 $ (1,182) $ 3,843 Foreign currency translation adjustment 5,393 — 5,393 Net current-period other comprehensive income 5,393 — 5,393 Accumulated other comprehensive income (loss) as of January 31, 2021 $ 10,418 $ (1,182) $ 9,236

SEGMENT INFORMATION (Tables)

SEGMENT INFORMATION (Tables)	6 Months Ended
	Jan. 31, 2022
Segment Reporting [Abstract]
Summarized financial information of continuing operations	Summarized financial information by operating segment is as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Net revenue: Direct Marketing $ 66,316 $ 91,155 $ 147,375 $ 196,863 Supply Chain 54,322 64,892 98,676 129,118 $ 120,638 $ 156,047 $ 246,051 $ 325,981 Operating (loss) income: Direct Marketing $ (14,262) $ 5,769 $ (25,740) $ 10,706 Supply Chain 2,374 4,957 4,347 10,108 Total segment operating (loss) income (11,888) 10,726 (21,393) 20,814 Corporate-level activity (2,323) (2,045) (3,725) (5,058) Total operating (loss) income (14,211) 8,681 (25,118) 15,756 Total other expense, net (8,043) (9,986) (16,315) (19,808) Loss before income taxes $ (22,254) $ (1,305) $ (41,433) $ (4,052)
Total assets of continuing operations	January 31, July 31, (In thousands) Total assets: Direct Marketing $ 476,374 $ 530,944 Supply Chain 102,748 101,159 Sub-total—segment assets 579,122 632,103 Corporate 43,562 44,278 $ 622,684 $ 676,381
Summarized financial information of net revenue from external customers by group of services	Summarized financial information of the Company's net revenue from external customers by group of services is as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) Products: Direct Marketing $ 66,316 $ 91,155 $ 147,375 $ 196,863 Services: Supply Chain 54,322 64,892 98,676 129,118 $ 120,638 $ 156,047 $ 246,051 $ 325,981 Summarized financial information of the Company's net revenue by geographic location is as follows: Three Months Ended Six Months Ended 2022 2021 2022 2021 (In thousands) United States $ 80,022 $ 108,280 $ 171,528 $ 229,763 China 19,423 22,409 35,389 42,049 Netherlands 6,227 5,387 11,876 13,182 Other 14,966 19,971 27,258 40,987 $ 120,638 $ 156,047 $ 246,051 $ 325,981

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	6 Months Ended
	Jan. 31, 2022
Fair Value Disclosures [Abstract]
Financial assets measured at fair value on recurring basis and classified by fair value hierarchy	The following tables present the Company's financial assets measured at fair value on a recurring basis as of January 31, 2022 and July 31, 2021, classified by fair value hierarchy: Fair Value Measurements at Reporting Date Using (In thousands) January 31, 2022 Level 1 Level 2 Level 3 Assets: Money market funds $ 41,326 $ 41,326 $ — $ — Fair Value Measurements at Reporting Date Using (In thousands) July 31, 2021 Level 1 Level 2 Level 3 Assets: Money market funds $ 42,327 $ 42,327 $ — $ —

NATURE OF OPERATIONS - Nature o

NATURE OF OPERATIONS - Nature of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands	Nov. 19, 2020	Feb. 25, 2022	Jan. 31, 2022	Jul. 31, 2021
Nature Of Operations [Line Items]
Long-term debt			$ 371,139	$ 373,134
Assets			622,684	676,381
Liabilities			624,244	634,989
Cash and cash equivalents			64,600	96,900
Working capital deficit			388,700
Current portion of long-term debt			$ 360,996	$ 5,602
Preferred stock, par value (in usd per share)			$ 0.01	$ 0.01
IWCO Direct Holdings, Inc.
Nature Of Operations [Line Items]
Assets			$ 469,700
Liabilities			516,300
Outstanding balance			361,300
IWCO Direct Holdings, Inc. | Subsequent Event
Nature Of Operations [Line Items]
Deferred income tax liabilities, net		$ 11,600
Subordinated Debt | IWCO Direct Holdings, Inc. | Subsequent Event
Nature Of Operations [Line Items]
Long-term debt		6,900
Subordinated debt obligations, fair value disclosure		$ 0
Series A Preferred Stock
Nature Of Operations [Line Items]
Preferred stock, dividend rate, percentage	6.00%
Minimum | Common Stock
Nature Of Operations [Line Items]
Preferred stock, par value (in usd per share)	$ 0.65
Maximum | Common Stock
Nature Of Operations [Line Items]
Preferred stock, par value (in usd per share)	$ 0.72
MidCap Credit Facility
Nature Of Operations [Line Items]
Line of credit facility, maximum credit commitment			12,500
PNC bank credit facility
Nature Of Operations [Line Items]
Credit facility, readily available borrowing capacity			$ 9,200

NATURE OF OPERATIONS - Business

NATURE OF OPERATIONS - Business Disposal, Pro Forma Information (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		12 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021	Jul. 31, 2021
Nature Of Operations [Line Items]
Net revenue	$ 120,638	$ 156,047	$ 246,051	$ 325,981
Cost of revenue	107,038	120,197	217,171	249,663
Operating (loss) income	$ (14,211)	$ 8,681	(25,118)	$ 15,756
IWCO Direct Holdings, Inc.
Nature Of Operations [Line Items]
Net revenue			98,676		$ 226,256
Cost of revenue			78,369		178,552
Operating (loss) income			$ 622		$ (1,569)

BASIS OF PRESENTATION (Details)

BASIS OF PRESENTATION (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jan. 31, 2022	Jan. 31, 2022	Jan. 31, 2021
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Other assets and liabilities		$ (14,803)	$ (15,317)
Non-cash lease expense		7,015	$ 7,158
Revision of prior period, reclassification, adjustment | Reclassification adjustment to confirm with current reporting
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Other assets and liabilities		$ 7,200
Non-cash lease expense	$ 7,200

INVENTORIES, NET - Components o

INVENTORIES, NET - Components of Inventories (Details) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Inventory Disclosure [Abstract]
Raw materials	$ 18,130	$ 15,484
Work-in-process	640	76
Finished goods	658	668
Inventories, net	$ 19,428	$ 16,228

GOODWILL AND INTANGIBLE ASSET_2

GOODWILL AND INTANGIBLE ASSETS - Additional Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jan. 31, 2022	Jul. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Goodwill	$ 231,470	$ 231,470
Gross Carrying Amount	213,250	213,250
Accumulated Amortization	106,330	98,245
Net Carrying Amount	$ 106,920	115,005
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period	15 years
Gross Carrying Amount	$ 192,730	192,730
Accumulated Amortization	85,810	77,725
Net Carrying Amount	$ 106,920	115,005
Trademarks and tradenames
Finite-Lived Intangible Assets [Line Items]
Weighted Average Amortization Period	3 years
Gross Carrying Amount	$ 20,520	20,520
Accumulated Amortization	20,520	20,520
Net Carrying Amount	0	0
Direct Marketing
Finite-Lived Intangible Assets [Line Items]
Goodwill	$ 231,500	$ 231,500

GOODWILL AND INTANGIBLE ASSET_3

GOODWILL AND INTANGIBLE ASSETS - Schedule of Amortization Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	$ 3,903	$ 5,359	$ 8,085	$ 11,894
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	3,903	4,504	8,085	9,329
Trademarks and trade names
Finite-Lived Intangible Assets [Line Items]
Amortization of intangible assets	$ 0	$ 855	$ 0	$ 2,565

ACCRUED EXPENSES AND OTHER CU_3

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Components of Accrued Expenses (Details) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Payables and Accruals [Abstract]
Accrued taxes	$ 57,952	$ 57,152
Accrued compensation	20,428	22,987
Accrued worker's compensation	1,500	1,818
Accrued audit, tax and legal	4,042	3,674
Accrued contract labor	756	930
Accrued interest	476	476
Accrued other	19,722	19,834
Accrued expenses	$ 104,876	$ 106,871

ACCRUED EXPENSES AND OTHER CU_4

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Components of Other Current Liabilities (Details) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Payables and Accruals [Abstract]
Accrued pricing liabilities	$ 10,295	$ 10,295
Customer postage deposits	10,599	13,452
Other	4,700	4,354
Other current liabilities	$ 25,594	$ 28,101

ACCRUED EXPENSES AND OTHER CU_5

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Narrative (Details) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Payables and Accruals [Abstract]
Accrued taxes	$ 57,952	$ 57,152
Accrued pricing liabilities	$ 10,295	$ 10,295

RESTRUCTURING - Narrative (Deta

RESTRUCTURING - Narrative (Details) - IWCO Direct's Competitive Improvement Plan - USD ($) $ in Thousands	Jun. 02, 2021	Jan. 31, 2022	Jan. 31, 2022	Jan. 31, 2021
Restructuring Cost and Reserve [Line Items]
Total expected costs of business development	$ 54,000
Expected term of investment	24 months
Future net cash outflows relating to business development	$ 44,000
Costs incurred		$ 6,399	$ 13,636	$ 13,044
Digital Press and Insertion Equipment
Restructuring Cost and Reserve [Line Items]
Total expected costs of business development	38,000
Lease/Purchase Agreements
Restructuring Cost and Reserve [Line Items]
Total expected costs of business development	34,000
Employee-Related, Facilities Optimization, and Other Implementation Costs
Restructuring Cost and Reserve [Line Items]
Total expected costs of business development	16,000
Accelerated Depreciation
Restructuring Cost and Reserve [Line Items]
Total expected costs of business development	$ 12,000

RESTRUCTURING - Schedule of Res

RESTRUCTURING - Schedule of Restructuring Charges by Type (Details) - IWCO Direct's Competitive Improvement Plan - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jan. 31, 2022	Jan. 31, 2022	Jan. 31, 2021
Restructuring Cost and Reserve [Line Items]
Costs incurred	$ 6,399	$ 13,636	$ 13,044
Cost of revenue
Restructuring Cost and Reserve [Line Items]
Costs incurred	5,654		11,997
Selling, general and administrative
Restructuring Cost and Reserve [Line Items]
Costs incurred	745		1,047
Accelerated depreciation
Restructuring Cost and Reserve [Line Items]
Costs incurred	3,700		8,095
Impairment of long-lived assets
Restructuring Cost and Reserve [Line Items]
Costs incurred	0		70
Employee termination costs
Restructuring Cost and Reserve [Line Items]
Costs incurred	2,242	4,800	4,227
Contractual obligations
Restructuring Cost and Reserve [Line Items]
Costs incurred	113	199	308
Other
Restructuring Cost and Reserve [Line Items]
Costs incurred	344	472	344
Direct Marketing
Restructuring Cost and Reserve [Line Items]
Costs incurred	5,543		12,188
Direct Marketing | Cost of revenue
Restructuring Cost and Reserve [Line Items]
Costs incurred	5,008		11,351
Direct Marketing | Selling, general and administrative
Restructuring Cost and Reserve [Line Items]
Costs incurred	535		837
Direct Marketing | Accelerated depreciation
Restructuring Cost and Reserve [Line Items]
Costs incurred	3,700		8,095
Direct Marketing | Impairment of long-lived assets
Restructuring Cost and Reserve [Line Items]
Costs incurred	0		70
Direct Marketing | Employee termination costs
Restructuring Cost and Reserve [Line Items]
Costs incurred	1,386		3,371
Direct Marketing | Contractual obligations
Restructuring Cost and Reserve [Line Items]
Costs incurred	113		308
Direct Marketing | Other
Restructuring Cost and Reserve [Line Items]
Costs incurred	344		344
Supply Chain
Restructuring Cost and Reserve [Line Items]
Costs incurred	856	$ 900	856
Supply Chain | Cost of revenue
Restructuring Cost and Reserve [Line Items]
Costs incurred	646		646
Supply Chain | Selling, general and administrative
Restructuring Cost and Reserve [Line Items]
Costs incurred	210		210
Supply Chain | Accelerated depreciation
Restructuring Cost and Reserve [Line Items]
Costs incurred	0		0
Supply Chain | Impairment of long-lived assets
Restructuring Cost and Reserve [Line Items]
Costs incurred	0		0
Supply Chain | Employee termination costs
Restructuring Cost and Reserve [Line Items]
Costs incurred	856		856
Supply Chain | Contractual obligations
Restructuring Cost and Reserve [Line Items]
Costs incurred	0		0
Supply Chain | Other
Restructuring Cost and Reserve [Line Items]
Costs incurred	$ 0		$ 0

RESTRUCTURING - Restructuring L

RESTRUCTURING - Restructuring Liability Rollforward (Details) - IWCO Direct's Competitive Improvement Plan - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jan. 31, 2022	Jan. 31, 2022	Jan. 31, 2021
Restructuring Reserve [Roll Forward]
Beginning balance		$ 1,055
Costs incurred	$ 6,399	13,636	$ 13,044
Cash payments		(4,395)
Non-cash relief of accrual		(8,172)
Change in estimates		(655)
Ending balance	1,469	1,469
Employee termination costs
Restructuring Reserve [Roll Forward]
Beginning balance		1,055
Costs incurred	2,242	4,800	4,227
Cash payments		(3,759)
Non-cash relief of accrual		(7)
Change in estimates		(655)
Ending balance	1,434	1,434
Contractual obligations
Restructuring Reserve [Roll Forward]
Beginning balance		0
Costs incurred	113	199	308
Cash payments		(164)
Non-cash relief of accrual		0
Change in estimates		0
Ending balance	35	35
Asset Impairment
Restructuring Reserve [Roll Forward]
Beginning balance		0
Costs incurred		8,165
Cash payments		0
Non-cash relief of accrual		(8,165)
Change in estimates		0
Ending balance	0	0
Other
Restructuring Reserve [Roll Forward]
Beginning balance		0
Costs incurred	344	472	$ 344
Cash payments		(472)
Non-cash relief of accrual		0
Change in estimates		0
Ending balance	$ 0	$ 0

LEASES - Lease Costs (Details)

LEASES - Lease Costs (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Lease, Cost [Abstract]
Operating lease cost	$ 4,165	$ 4,131	$ 8,166	$ 8,359
Short-term lease expense	507	533	856	940
Variable lease cost	4	11	15	19
Interest on finance lease liabilities	1	1	2	3
Total lease cost	$ 4,677	$ 4,676	$ 9,039	$ 9,321

LEASES - Supplemental Cash Flow

LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	$ 8,091	$ 8,377
Operating cash flows from finance leases	2	3
Financing cash flows from finance leases	$ 36	$ 35

DEBT - Component of Debt and Re

DEBT - Component of Debt and Reconciliation (Details) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Line of Credit Facility [Line Items]
Less: unamortized discounts and issuance costs	$ (5,131)	$ (6,136)
Total debt, net	371,139	373,134
Less: current portion of debt, net	(360,996)	(5,602)
Total long-term debt, net	10,143	367,532
7.50% Convertible Senior Note due March 1, 2024
Line of Credit Facility [Line Items]
Principal amount of long term debt	14,940	14,940
Cerberus Term Loan due December 15, 2022
Line of Credit Facility [Line Items]
Principal amount of long term debt	361,330	364,330
Cerberus Revolving Facility
Line of Credit Facility [Line Items]
Revolving credit facility	0	0
MidCap Credit Facility
Line of Credit Facility [Line Items]
Revolving credit facility	$ 0	$ 0

DEBT - Additional Information (

DEBT - Additional Information (Details)	Feb. 28, 2019USD ($)$ / shares	Jan. 31, 2022USD ($)	Mar. 16, 2022USD ($)	Jul. 31, 2021USD ($)
Debt Instrument [Line Items]
Long-term debt		$ 371,139,000		$ 373,134,000
Debt instrument, interest rate, effective percentage		27.80%
Subsequent Event | Umpqua revolver
Debt Instrument [Line Items]
Line of credit facility, maximum credit commitment			$ 12,500,000
Line of credit facility, sublimit borrowing capacity			$ 5,000,000
Covenant compliance duration			12 months
SPHG Holdings
Debt Instrument [Line Items]
Conversion to common stock	$ 1,000
Conversion ratio (shares)	0.4212655
Initial conversion price (in usd per share) | $ / shares	$ 2.37
SPHG Holdings | 7.50% Convertible Senior Note due March 1, 2024
Debt Instrument [Line Items]
Debt instrument, stated interest rate	7.50%
Principal amount of note	$ 14,900,000	$ 14,940,000		14,940,000
Debt instrument amortization period		25 months
Long-term debt		$ 10,143,000		$ 9,343,000

DEBT - Net Carrying Value of th

DEBT - Net Carrying Value of the Notes (Details) - USD ($)	Jan. 31, 2022	Jul. 31, 2021	Feb. 28, 2019
Debt Instrument [Line Items]
Carrying amount of equity component	$ 8,200,000	$ 8,200,000
Total debt, net	371,139,000	373,134,000
SPHG Holdings | 7.50% Convertible Senior Note due March 1, 2024
Debt Instrument [Line Items]
Principal amount of note	14,940,000	14,940,000	$ 14,900,000
Unamortized debt discount	(4,797,000)	(5,597,000)
Total debt, net	$ 10,143,000	$ 9,343,000

DEBT - Summary of Interest Expe

DEBT - Summary of Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	$ 700	$ 600	$ 1,372	$ 1,178
SPHG Holdings | Interest expense related to contractual interest coupon
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	286	287	572	573
SPHG Holdings | Interest expense related to accretion of the discount
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	$ 414	$ 313	$ 800	$ 605

CONTINGENCIES - Additional Info

CONTINGENCIES - Additional Information (Details) - USD ($) $ in Thousands	Feb. 18, 2022	Dec. 15, 2017	Aug. 31, 2021
Subsequent Event
Contingencies [Line Items]
Legal fees	$ 2,050
Reith v. Lichtenstein
Contingencies [Line Items]
Cash paid to plaintiff			$ 2,750
Reith v. Lichtenstein | Director | Restricted Stock
Contingencies [Line Items]
Number of shares surrendered			3,300,000
Reith v. Lichtenstein | Director | Restricted Stock | Warren Lichtenstein
Contingencies [Line Items]
Number of vested shares surrendered			1,833,333
Number of nonvested shares surrendered			300,000
Reith v. Lichtenstein | Director | Restricted Stock | Jack Howard
Contingencies [Line Items]
Number of vested shares surrendered			916,667
Number of nonvested shares surrendered			150,000
Reith v. Lichtenstein | Director | Restricted Stock | William Fejes
Contingencies [Line Items]
Number of vested shares surrendered			100,000
Purchase agreement | SPHG Holdings | Series C convertible preferred stock
Contingencies [Line Items]
Proceeds from issuance of preferred stock		$ 35,000

REVENUE RECOGNITION - Disaggreg

REVENUE RECOGNITION - Disaggregated Revenue (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Disaggregation of Revenue [Line Items]
Net revenue	$ 120,638	$ 156,047	$ 246,051	$ 325,981
Marketing solutions offerings
Disaggregation of Revenue [Line Items]
Net revenue	66,316	91,155	147,375	196,863
Supply chain management services
Disaggregation of Revenue [Line Items]
Net revenue	53,719	64,342	97,661	128,129
Other
Disaggregation of Revenue [Line Items]
Net revenue	603	550	1,015	989
Products
Disaggregation of Revenue [Line Items]
Net revenue	66,316	91,155	147,375	196,863
Products | Transferred over time
Disaggregation of Revenue [Line Items]
Net revenue	66,316	91,155	147,375	196,863
Services
Disaggregation of Revenue [Line Items]
Net revenue	54,322	64,892	98,676	129,118
Services | Transferred over time
Disaggregation of Revenue [Line Items]
Net revenue	54,322	64,892	98,676	129,118
Direct Marketing
Disaggregation of Revenue [Line Items]
Net revenue	66,316	91,155	147,375	196,863
Direct Marketing | Marketing solutions offerings
Disaggregation of Revenue [Line Items]
Net revenue	66,316	91,155	147,375	196,863
Direct Marketing | Supply chain management services
Disaggregation of Revenue [Line Items]
Net revenue	0	0	0	0
Direct Marketing | Other
Disaggregation of Revenue [Line Items]
Net revenue	0	0	0	0
Direct Marketing | Products | Transferred over time
Disaggregation of Revenue [Line Items]
Net revenue	66,316	91,155	147,375	196,863
Direct Marketing | Services | Transferred over time
Disaggregation of Revenue [Line Items]
Net revenue	0	0	0	0
Supply Chain
Disaggregation of Revenue [Line Items]
Net revenue	54,322	64,892	98,676	129,118
Supply Chain | Marketing solutions offerings
Disaggregation of Revenue [Line Items]
Net revenue	0	0	0	0
Supply Chain | Supply chain management services
Disaggregation of Revenue [Line Items]
Net revenue	53,719	64,342	97,661	128,129
Supply Chain | Other
Disaggregation of Revenue [Line Items]
Net revenue	603	550	1,015	989
Supply Chain | Products | Transferred over time
Disaggregation of Revenue [Line Items]
Net revenue	0	0	0	0
Supply Chain | Services | Transferred over time
Disaggregation of Revenue [Line Items]
Net revenue	$ 54,322	$ 64,892	$ 98,676	$ 129,118

REVENUE RECOGNITION - Additiona

REVENUE RECOGNITION - Additional Information (Detail) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021	Jan. 31, 2021	Jul. 31, 2020
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Contract assets	$ 10,530	$ 14,458
Deferred revenue - current	3,560	2,562
Deferred revenue - long-term	85	108
Total deferred revenue	3,645	2,670	$ 5,494	$ 2,945
Accounts receivable, trade, net
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Accounts receivable, trade, net	$ 68,971	$ 69,805

REVENUE RECOGNITION - Summary o

REVENUE RECOGNITION - Summary of Changes in Deferred Revenue (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021
Change in Deferred Revenue
Balance at beginning of period	$ 2,670	$ 2,945
Deferral of revenue	1,959	4,417
Recognition of deferred amounts upon satisfaction of performance obligation	(984)	(1,868)
Balance at end of period	$ 3,645	$ 5,494

REVENUE RECOGNITION - Performan

REVENUE RECOGNITION - Performance Obligations (Details) $ in Millions	Jan. 31, 2022USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-02-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 3.3
Revenue, remaining performance obligation, expected timing of satisfaction, period	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-02-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 0.1
Revenue, remaining performance obligation, expected timing of satisfaction, period

INCOME TAXES - Additional Infor

INCOME TAXES - Additional Information (Detail) - USD ($) $ in Millions	Jan. 31, 2022	Jul. 31, 2021	Jan. 31, 2021
Income Tax Disclosure [Abstract]
Unrecognized tax benefits related to federal, state and foreign taxes	$ 2.5	$ 2.5
Deferred employer-paid portion of social security taxes	5.3		$ 5.3
Liabilities for interest expense related to uncertain tax positions	0.4	$ 0.3
Income tax penalties accrued	0.4
Expected unrecognized tax benefits to reverse in the next twelve months	$ 0.7

LOSS PER SHARE - Reconciliation

LOSS PER SHARE - Reconciliation of (Loss) Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Earnings Per Share [Abstract]
Net loss	$ (22,977)	$ (2,196)	$ (42,471)	$ (5,747)
Less: Preferred dividends on redeemable preferred stock	(537)	(530)	(1,074)	(1,067)
Net loss attributable to common stockholders	$ (23,514)	$ (2,726)	$ (43,545)	$ (6,814)
Weighted average common shares used in basic loss per share (in shares)	59,748	62,028	60,027	61,961
Weighted average common shared used in diluted loss per share (in shares)	59,748	62,028	60,027	61,961
Basic net loss per share attributable to common stockholders (in usd per share)	$ (0.39)	$ (0.04)	$ (0.73)	$ (0.11)
Diluted net loss per share attributable to common stockholders (in usd per share)	$ (0.39)	$ (0.04)	$ (0.73)	$ (0.11)

LOSS PER SHARE - Additional Inf

LOSS PER SHARE - Additional Information (Details) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Earnings Per Share [Abstract]
Common stock equivalent shares excluded from the denominator in the calculation of diluted loss per share (in shares)	24.2	24.2	24.2	24.2

COMPREHENSIVE INCOME (LOSS) - A

COMPREHENSIVE INCOME (LOSS) - Accumulated Other Comprehensive Income Items (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	$ (13,431)	$ 47,894	$ 6,212	$ 48,818
Foreign currency translation adjustment	(13)	2,420	185	5,393
Total other comprehensive (loss) income	(13)	2,420	185	5,393
Ending balance	(36,740)	47,747	(36,740)	47,747
Accumulated Other Comprehensive Income
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	7,360	6,816	7,162	3,843
Foreign currency translation adjustment			185	5,393
Total other comprehensive (loss) income			185	5,393
Ending balance	7,347	9,236	7,347	9,236
Foreign Currency Items
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance			9,762	5,025
Foreign currency translation adjustment			185	5,393
Total other comprehensive (loss) income			185	5,393
Ending balance	9,947	10,418	9,947	10,418
Pension Items
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance			(2,600)	(1,182)
Foreign currency translation adjustment			0	0
Total other comprehensive (loss) income			0	0
Ending balance	$ (2,600)	$ (1,182)	$ (2,600)	$ (1,182)

SEGMENT INFORMATION - Additiona

SEGMENT INFORMATION - Additional Information (Details)	6 Months Ended
	Jan. 31, 2022segment
Segment Reporting [Abstract]
Number of operating segments	2
Number of reportable segments	2

SEGMENT INFORMATION - Summarize

SEGMENT INFORMATION - Summarized Financial Information of Continuing Operations (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Segment Reporting Information [Line Items]
Revenue from contracts with customers	$ 120,638	$ 156,047	$ 246,051	$ 325,981
Operating (loss) income	(14,211)	8,681	(25,118)	15,756
Total other expense, net	(8,043)	(9,986)	(16,315)	(19,808)
Loss before income taxes	(22,254)	(1,305)	(41,433)	(4,052)
Direct Marketing
Segment Reporting Information [Line Items]
Revenue from contracts with customers	66,316	91,155	147,375	196,863
Supply Chain
Segment Reporting Information [Line Items]
Revenue from contracts with customers	54,322	64,892	98,676	129,118
Operating segments
Segment Reporting Information [Line Items]
Operating (loss) income	(11,888)	10,726	(21,393)	20,814
Operating segments | Direct Marketing
Segment Reporting Information [Line Items]
Revenue from contracts with customers	66,316	91,155	147,375	196,863
Operating (loss) income	(14,262)	5,769	(25,740)	10,706
Operating segments | Supply Chain
Segment Reporting Information [Line Items]
Revenue from contracts with customers	54,322	64,892	98,676	129,118
Operating (loss) income	2,374	4,957	4,347	10,108
Corporate
Segment Reporting Information [Line Items]
Operating (loss) income	$ (2,323)	$ (2,045)	$ (3,725)	$ (5,058)

SEGMENT INFORMATION - Total Ass

SEGMENT INFORMATION - Total Assets of Continuing Operations (Details) - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Segment Reporting Information [Line Items]
Assets	$ 622,684	$ 676,381
Operating segments
Segment Reporting Information [Line Items]
Assets	579,122	632,103
Operating segments | Direct Marketing
Segment Reporting Information [Line Items]
Assets	476,374	530,944
Operating segments | Supply Chain
Segment Reporting Information [Line Items]
Assets	102,748	101,159
Corporate
Segment Reporting Information [Line Items]
Assets	$ 43,562	$ 44,278

SEGMENT INFORMATION - Summari_2

SEGMENT INFORMATION - Summarized Financial Information of Net Revenue from External Customers by Group of Services (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	$ 120,638	$ 156,047	$ 246,051	$ 325,981
United States
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	80,022	108,280	171,528	229,763
China
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	19,423	22,409	35,389	42,049
Netherlands
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	6,227	5,387	11,876	13,182
Other
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	14,966	19,971	27,258	40,987
Direct Marketing
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	66,316	91,155	147,375	196,863
Supply Chain
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	$ 54,322	$ 64,892	$ 98,676	$ 129,118

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details) - USD ($)	Dec. 15, 2017	Jan. 31, 2022	Jan. 31, 2021	Jan. 31, 2022	Jan. 31, 2021	Jul. 31, 2021	Feb. 28, 2019
Related Party Transaction [Line Items]
Long-term debt		$ 371,139,000		$ 371,139,000		$ 373,134,000
Preferred stock, shares issued (in shares)		0		0		0
SPHG Holdings | 7.50% Convertible Senior Note due March 1, 2024
Related Party Transaction [Line Items]
Principal amount convertible senior notes held of		$ 14,940,000		$ 14,940,000		$ 14,940,000	$ 14,900,000
Long-term debt		10,143,000		10,143,000		9,343,000
Steel Holdings | Convertible debt
Related Party Transaction [Line Items]
Principal amount convertible senior notes held of		14,900,000		14,900,000		14,900,000	$ 14,900,000
SPHG Holdings | Purchase agreement | Series C convertible preferred stock
Related Party Transaction [Line Items]
Preferred stock, shares issued (in shares)	35,000
Price per share (in usd per share)	$ 1,000
Proceeds from issuance of preferred stock	$ 35,000,000
Steel Services Ltd. | Management Services Agreement
Related Party Transaction [Line Items]
Total expenses incurred related to Management Services Agreement and Transfer Agreement		900,000	$ 900,000	1,800,000	$ 2,500,000
SP Corporate Services Llc and Steel Services Limited | Management Services Agreement
Related Party Transaction [Line Items]
Amount due to related parties		$ 700,000		$ 700,000		$ 900,000
Steel Connect, Inc. | SPHG Holdings
Related Party Transaction [Line Items]
Ownership percentage in capital stock		53.40%		53.40%

FAIR VALUE MEASUREMENTS - Finan

FAIR VALUE MEASUREMENTS - Financial Assets Measured at Fair Value on Recurring Basis and Classified by Fair Value Hierarchy (Details) - Fair value, measurements, recurring - Money market funds - USD ($) $ in Thousands	Jan. 31, 2022	Jul. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, recurring	$ 41,326	$ 42,327
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, recurring	41,326	42,327
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, recurring	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, recurring	$ 0	$ 0