Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



FORM			10-Q


☑			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended October 28, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-16435



Chico’s FAS, Inc.
(Exact name of registrant as specified in its charter)


Florida						59-2389435
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

11215 Metro Parkway, Fort Myers, Florida 33966

(Address of principal executive offices) (Zip Code)

239-277-6200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, Par Value $0.01 Per Share	CHS	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer

☐

Accelerated filer

☑

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

At November 21, 2023, the registrant had 123,457,364 shares of Common Stock, $0.01 par value per share, outstanding.

Table of Contents

CHICO’S FAS, INC. AND SUBSIDIARIES

QUARTERLY REPORT ON FORM 10-Q

FOR THE

FISCAL THIRTEEN AND THIRTY-NINE WEEKS ENDED OCTOBER 28, 2023

TABLE OF CONTENTS


PART I – Financial Information

Item 1.	Financial Statements:

	Condensed Consolidated Statements of Income for the Thirteen and T hirty-Nine Weeks Ended October 2 8 , 2023 (Unaudited) and October 29 , 2022 (Unaudited)	4

	Condensed Consolidated Statements of Comprehensive Income for the Thirteen and Thirty-Nine Weeks Ended October 28, 2023 (Unaudited) and October 29, 2022 (Unaudited)	5

	Condensed Consolidated Balance Sheets – October 28 , 2023 (Unaudited), January 28, 2023 (Audited), and October 29 , 2022 (Unaudited)	6

	Condensed Consolidated Statements of Shareholders’ Equity for the Thirteen and T hirty-Nine Weeks Ended October 28 , 2023 (Unaudited) and October 29 , 2022 (Unaudited)	7

	Condensed Consolidated Statements of Cash Flows for the T hirty-Nine Weeks Ended October 28 , 2023 (Unaudited) and October 29 , 2022 (Unaudited)	9

	Notes to Condensed Consolidated Financial Statements (Unaudited)	10

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	34

Item 4.	Controls and Procedures	34

PART II – Other Information

Item 1.	Legal Proceedings	35

Item 1A.	Risk Factors	36



Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	38

Item 5.	Other Information	39

Item 6.	Exhibits	40

Signatures		41

Table of Contents

PART I – FINANCIAL INFORMATION


ITEM 1.			FINANCIAL STATEMENTS

The accompanying notes are an integral part of these condensed consolidated statements.

CHICO’S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(in thousands, except per share amounts)


	Thirteen Weeks Ended								Thirty-Nine Weeks Ended
	October 28, 2023				October 29, 2022				October 28, 2023				October 29, 2022

	Amount		% of Sales		Amount		% of Sales		Amount		% of Sales		Amount		% of Sales
Net Sales	$	505,126	100.0	%	$	518,332	100.0	%	$	1,584,995	100.0	%	$	1,617,967	100.0	%
Cost of goods sold	308,677		61.1		310,892		60.0		946,637		59.7		962,448		59.5
Gross Profit	196,449		38.9		207,440		40.0		638,358		40.3		655,519		40.5
Selling, general, and administrative expenses	178,643		35.4		175,841		33.9		520,672		32.8		520,296		32.1
Merger-related costs	7,277		1.4		—		0.0		7,277		0.5		—		0.0


Income from Operations	10,529		2.1		31,599		6.1		110,409		7.0		135,223		8.4
Interest expense, net	(389)		(0.1)		(1,080)		(0.2)		(1,439)		(0.1)		(3,111)		(0.2)
Income before Income Taxes	10,140		2.0		30,519		5.9		108,970		6.9		132,112		8.2
Income tax provision	5,100		1.0		5,900		1.2		4,700		0.3		30,600		1.9
Net Income	$	5,040	1.0	%	$	24,619	4.7	%	$	104,270	6.6	%	$	101,512	6.3	%
Per Share Data:
Net income per common share – basic	$	0.04			$	0.20			$	0.87			$	0.84
Net income per common and common equivalent share – diluted	$	0.04			$	0.20			$	0.85			$	0.82
Weighted average common shares outstanding – basic	119,457				120,333				119,424				119,776
Weighted average common and common equivalent shares outstanding – diluted	122,735				124,887				122,500				124,016

The accompanying notes are an integral part of these condensed consolidated statements.

Table of Contents

CHICO’S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(in thousands)


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022
Net income	$	5,040	$	24,619	$	104,270	$	101,512
Other comprehensive income:
Unrealized gains (losses) on marketable securities, net of taxes	35		(233)		72		(228)

Comprehensive income	$	5,075	$	24,386	$	104,342	$	101,284

The accompanying notes are an integral part of these condensed consolidated statements.

Table of Contents

CHICO’S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share amounts)


	October 28, 2023		January 28, 2023		October 29, 2022
ASSETS	(Unaudited)		(Audited)		(Unaudited)

Current Assets:
Cash and cash equivalents	$	101,944	$	153,377	$	117,726
Marketable securities, at fair value	24,702		24,677		23,017
Inventories	342,721		276,840		304,127
Prepaid expenses and other current assets	51,086		48,604		47,208
Income tax receivable	9,181		11,865		15,430

Total Current Assets	529,634		515,363		507,508
Property and Equipment, net	200,980		192,165		183,153
Right of Use Assets	466,888		435,321		432,018
Other Assets:
Goodwill	16,360		16,360		16,360
Other intangible assets, net	5,000		5,000		5,000
Other assets, net	45,853		23,632		18,890
Total Other Assets	67,213		44,992		40,250
	$	1,264,715	$	1,187,841	$	1,162,929
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current Liabilities:
Accounts payable	$	153,401	$	156,262	$	107,400
Current lease liabilities	150,053		153,202		157,687

Other current and deferred liabilities	138,887		141,698		155,133

Total Current Liabilities	442,341		451,162		420,220
Noncurrent Liabilities:
Long-term debt	24,000		49,000		69,000
Long-term lease liabilities	373,823		349,409		346,560
Other noncurrent and deferred liabilities	1,956		2,637		2,612

Total Noncurrent Liabilities	399,779		401,046		418,172
Commitments and Contingencies (see Note 12)
Shareholders’ Equity:
Preferred stock, $0.01 par value; 2,500 shares authorized; no shares issued and outstanding	—		—		—
Common stock, $0.01 par value; 400,000 shares authorized; 167,994 and 166,320 and 166,326 shares issued respectively; and 123,447 and 125,023 and 125,029 shares outstanding, respectively	1,234		1,250		1,250
Additional paid-in capital	516,323		513,914		510,374
Treasury stock, at cost, 44,547 and 41,297 and 41,297 shares, respectively	(514,168)		(494,395)		(494,395)
Retained earnings	419,292		315,022		307,536
Accumulated other comprehensive loss	(86)		(158)		(228)
Total Shareholders’ Equity	422,595		335,633		324,537
	$	1,264,715	$	1,187,841	$	1,162,929

The accompanying notes are an integral part of these condensed consolidated statements.

Table of Contents

CHICO’S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

(in thousands)


	Thirteen Weeks Ended
	Common Stock			Additional Paid-in Capital		Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Gain (Loss)
	Shares	Par Value				Shares	Amount						Total
BALANCE, July 29, 2023	123,524	$	1,235	$	514,059	44,547	$	(514,168)	$	414,252	$	(121)	$	415,257


Net income	—	—		—		—	—		5,040		—		5,040
Unrealized gains on marketable securities, net of taxes	—	—		—		—	—		—		35		35

Issuance of common stock	44	—		111		—	—		—		—		111

Repurchase of common stock and tax withholdings related to share-based awards	(121)	(1)		(677)		—	—		—		—		(678)
Share-based compensation	—	—		2,830		—	—		—		—		2,830
BALANCE, October 28, 2023	123,447	$	1,234	$	516,323	44,547	$	(514,168)	$	419,292	$	(86)	$	422,595

BALANCE, July 30, 2022	125,184	$	1,252	$	508,105	41,297	$	(494,395)	$	282,910	$	5	$	297,877


Net income	—	—		—		—	—		24,619		—		24,619
Unrealized losses on marketable securities, net of taxes	—	—		—		—	—		—		(233)		(233)

Issuance of common stock	3	—		83		—	—		—		—		83
Dividends on common stock	—	—		—		—	—		7		—		7
Repurchase of common stock and tax withholdings related to share-based awards	(158)	(2)		(978)		—	—		—		—		(980)
Share-based compensation	—	—		3,164		—	—		—		—		3,164
BALANCE, October 29, 2022	125,029	$	1,250	$	510,374	41,297	$	(494,395)	$	307,536	$	(228)	$	324,537

The accompanying notes are an integral part of these condensed consolidated statements.

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CHICO’S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

(in thousands, except per share amounts)


	Thirty-Nine Weeks Ended
	Common Stock			Additional Paid-in Capital		Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Gain (Loss)
	Shares	Par Value				Shares	Amount						Total
BALANCE, January 28, 2023	125,023	$	1,250	$	513,914	41,297	$	(494,395)	$	315,022	$	(158)	$	335,633


Net income	—	—		—		—	—		104,270		—		104,270
Unrealized gains on marketable securities, net of taxes	—	—		—		—	—		—		72		72

Issuance of common stock	2,830	28		301		—	—		—		—		329

Repurchase of common stock and tax withholdings related to share-based awards	(4,406)	(44)		(7,028)		3,250	(19,773)		—		—		(26,845)
Share-based compensation	—	—		9,136		—	—		—		—		9,136
BALANCE, October 28, 2023	123,447	$	1,234	$	516,323	44,547	$	(514,168)	$	419,292	$	(86)	$	422,595

BALANCE, January 29, 2022	122,526	$	1,225	$	508,654	41,297	$	(494,395)	$	206,020	$	—	$	221,504


Net income	—	—		—		—	—		101,512		—		101,512
Unrealized losses on marketable securities, net of taxes	—	—		—		—	—		—		(228)		(228)

Issuance of common stock	4,258	43		196		—	—		—		—		239
Dividends on common stock	—	—		—		—	—		4		—		4
Repurchase of common stock and tax withholdings related to share-based awards	(1,755)	(18)		(8,797)		—	—		—		—		(8,815)
Share-based compensation	—	—		10,321		—	—		—		—		10,321
BALANCE, October 29, 2022	125,029	$	1,250	$	510,374	41,297	$	(494,395)	$	307,536	$	(228)	$	324,537

The accompanying notes are an integral part of these condensed consolidated statements.

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CHICO’S FAS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in thousands)


	Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022
Cash Flows from Operating Activities:
Net income	$	104,270	$	101,512
Adjustments to reconcile net income to net cash provided by operating activities:

Inventory write-offs	—		826
Depreciation and amortization	31,283		33,350
Non-cash lease expense	135,679		137,184


Loss on disposal and impairment of property and equipment, net	83		1,804
Deferred tax benefit	(15,825)		(381)
Share-based compensation expense	9,136		10,321


Changes in assets and liabilities:
Inventories	(65,881)		18,436
Prepaid expenses and other assets	(10,480)		(2,591)
Income tax receivable	2,684		(1,732)
Accounts payable	(2,778)		(73,120)
Accrued and other liabilities	(6,924)		13,583
Lease liability	(145,729)		(155,561)
Net cash provided by operating activities	35,518		83,631
Cash Flows from Investing Activities:
Purchases of marketable securities	(13,913)		(26,376)
Proceeds from sale of marketable securities	13,938		3,083
Purchases of property and equipment	(35,460)		(21,207)
Proceeds from sale of assets	—		2,772
Net cash used in investing activities	(35,435)		(41,728)
Cash Flows from Financing Activities:

Payments on borrowings	(25,000)		(30,000)
Payments of debt issuance costs	—		(706)
Proceeds from issuance of common stock	329		239

Repurchase of treasury stock under repurchase program	(19,805)		—
Payments of tax withholdings related to share-based awards	(7,040)		(8,815)
Net cash used in financing activities	(51,516)		(39,282)

Net (decrease) increase in cash and cash equivalents	(51,433)		2,621
Cash and Cash Equivalents, Beginning of period	153,377		115,105
Cash and Cash Equivalents, End of period	$	101,944	$	117,726

Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	$	2,409	$	3,686
Cash paid for income taxes, net	$	(14,230)	$	(26,426)

The accompanying notes are an integral part of these condensed consolidated statements.

CHICO’S FAS, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share amounts and where otherwise indicated)

(Unaudited)

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited condensed consolidated financial statements of Chico’s FAS, Inc., a Florida corporation, and its wholly owned subsidiaries (“Company”) have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and notes required by accounting principles generally accepted in the U.S. for complete financial statements. In the opinion of management, such interim financial statements reflect all normal, recurring adjustments considered necessary to present fairly the condensed consolidated financial position, the results of operations, and cash flows for the interim periods presented. All significant intercompany balances and transactions have been eliminated in consolidation. The fiscal year ended January 28, 2023 balance sheet data was derived from audited consolidated financial statements. For further information, refer to the consolidated financial statements and notes thereto for the fiscal year ended January 28, 2023, included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 28, 2023, filed with the Securities and Exchange Commission (“SEC”) on March 14, 2023 (“2022 Annual Report on Form 10-K”).

As used in this report, all references to “we,” “us,” “our,” “Company,” and “Chico’s FAS,” refer to Chico’s FAS, Inc. and all of its wholly owned subsidiaries.

Our fiscal years end on the Saturday closest to January 31 and are designated by the calendar year in which the fiscal year commences. Operating results for the thirteen and thirty-nine weeks ended October 28, 2023 are not necessarily indicative of the results that may be expected for the entire year.

Adoption of New Accounting Pronouncements

In September 2022, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update (“ASU”) 2022-04, entitled “Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations,” to improve the disclosures of supplier finance programs. Specifically, the ASU requires disclosure of key terms of the supplier finance programs and a roll-forward of the related obligations. The amendments in this ASU do not affect the recognition, measurement, or financial statement presentation of obligations covered by supplier finance programs. The ASU is effective for the fiscal years, and the interim periods within those years, beginning after December 15, 2022, except for the amendment on roll-forward information, which is effective for fiscal years beginning after December 15, 2023. Early adoption is permitted. The Company entered into a supplier financing agreement administered by a third-party platform in the fourth quarter of 2022. Payments to suppliers through this program began in the third quarter of fiscal 2023. Refer to Note 11 for additional information regarding the Company’s payment obligations to participating suppliers.

Entry into Merger Agreement

On September 27, 2023, the Company entered into an Agreement and Plan of Merger (“Merger Agreement”) with Daphne Parent LLC, a Delaware limited liability company (“Parent”), and Daphne Merger Sub, Inc., a Florida corporation and wholly owned subsidiary of Parent (“Merger Sub” and together with Parent, “Buyer Parties”), providing for the merger of Merger Sub with and into the Company, with the Company continuing as the surviving corporation and becoming a wholly owned subsidiary of Parent (“Merger”).

Upon the consummation of the Merger, each share of the Company’s common stock outstanding as of immediately prior to the effective time of the Merger (other than shares of the Company’s common stock that are (i) held by the Company or any subsidiary of the Company, (ii) owned by the Buyer Parties, or (iii) owned by any direct or indirect wholly owned subsidiary of the Buyer Parties as of immediately prior to the effective time (“Owned Company Shares”)) will be cancelled and extinguished and automatically converted into the right to receive cash in an amount equal to $7.60 per share, without interest thereon. Each Owned Company Share will be cancelled and extinguished without any conversion thereof or consideration paid therefor.

Consummation of the Merger is subject to certain conditions set forth in the Merger Agreement, including, but not limited to, the following: (i) the affirmative vote of the holders of a majority of all of the outstanding shares of the Company’s common stock to adopt the Merger Agreement; (ii) the absence of any law or order restraining, enjoining, or otherwise prohibiting the Merger; and (iii) the absence of a Company Material Adverse Effect (as defined in the Merger Agreement,

which is filed as Exhibit 2.1 to this Quarterly Report on Form 10-Q). The Go-Shop Period has ended, and the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, has expired. In addition, the Company filed its Definitive Merger Proxy Statement on Schedule 14A with the Securities and Exchange Commission on November 29, 2023. The transaction is not subject to a financing condition. The Merger Agreement includes customary representations, warranties, and covenants of the parties, including termination provisions for both the Company and the Buyer Parties. Under the Merger Agreement, the Company may be required to pay the Buyer Parties a termination fee of up to $29,956,324 if the Merger Agreement is terminated under certain specified circumstances. The Merger Agreement also places certain restrictions on the conduct of the Company’s business prior to the completion of the Merger, which could delay or prevent the Company from undertaking business opportunities that may arise or any other action it would otherwise take with respect to the operations of the Company absent these restrictions.

Parent and the Company expect to close the Merger by the end of the first calendar quarter of 2024.

2. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

The Company currently has no material recent accounting pronouncements yet to be adopted.

3. REVENUE RECOGNITION

Disaggregated Revenue

The table below disaggregates our operating segment revenue by brand, which we believe provides a meaningful depiction of the nature of our revenue. Amounts shown include licensing and wholesale revenue, which is not a significant component of total revenue, and is aggregated within the respective brands.



	Thirteen Weeks Ended								Thirty-Nine Weeks Ended
	October 28, 2023				October 29, 2022				October 28, 2023				October 29, 2022
Chico’s	$	252,221	49.9	%	$	255,341	49.3	%	$	800,088	50.5	%	$	801,584	49.5	%
WHBM	147,498		29.2		157,451		30.4		451,016		28.4		485,061		30.0
Soma	105,407		20.9		105,540		20.3		333,891		21.1		331,322		20.5

Total Net Sales	$	505,126	100.0	%	$	518,332	100.0	%	$	1,584,995	100.0	%	$	1,617,967	100.0	%

Contract Liability

Contract liabilities in the unaudited condensed consolidated balance sheets are comprised of obligations associated with our gift card and customer rewards programs. As of October 28, 2023, January 28, 2023, and October 29, 2022, contract liabilities primarily consisted of gift cards of $29.2 million, $42.6 million, and $31.9 million, respectively.

For the thirteen and thirty-nine weeks ended October 28, 2023, the Company recognized $6.2 million and $25.3 million, respectively, of revenue that was previously included in the gift card contract liability as of January 28, 2023. For the thirteen and thirty-nine weeks ended October 29, 2022, the Company recognized $7.0 million and $27.0 million, respectively, of revenue that was previously included in the gift card contract liability as of January 29, 2022.


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022


Beginning gift card liability	$	30,905	$	33,707	$	42,649	$	43,536
Issuances	7,602		7,878		26,585		28,218
Redemptions	(9,174)		(9,869)		(35,893)		(37,739)
Breakage adjustment	(162)		176		(4,170)		(2,123)
Ending gift card liability	$	29,171	$	31,892	$	29,171	$	31,892

The Company maintains customer rewards programs in which customers earn points toward rewards for qualifying purchases and other marketing activities. Upon reaching specified point values, customers are issued a reward, which they may redeem on merchandise purchases at the Company’s stores or on its website. Generally, rewards earned must be redeemed within 60 days from the date of issuance. The Company defers a portion of the merchandise sales based on the estimated standalone selling price of the points earned. This deferred revenue is recognized as the rewards are redeemed or expire. While historically this points-based program was specific to Soma®, during the second quarter of fiscal year 2022, Chico’s FAS extended its points-based rewards program to Chico’s® and White House Black Market® (“WHBM”). As of October 28, 2023, January 28, 2023, and October 29, 2022, the rewards deferred revenue balance was $9.9 million, $7.4 million, and $4.5 million, respectively.


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022


Beginning balance rewards deferred revenue	$	9,233	$	3,236	$	7,441	$	626
Net reduction in revenue	653		1,288		2,445		3,898
Ending balance rewards deferred revenue	$	9,886	$	4,524	$	9,886	$	4,524

Performance Obligation

For the thirteen and thirty-nine weeks ended October 28, 2023 and October 29, 2022, revenue recognized from performance obligations related to prior periods was not material. Revenue to be recognized in future periods related to performance obligations is not expected to be material.

4. LEASES

The Company leases retail stores, a limited amount of office space, and certain equipment under operating leases expiring in various years through the fiscal year ending 2033. All of our leases have been classified as operating leases and are recognized and measured as such.

Certain operating leases provide for renewal options that are at a pre-determined period and rental value. Furthermore, certain leases provide that we may cancel the lease if our retail sales at that location fall below an established level. In the normal course of business, operating leases are typically renewed or replaced by other leases.

Escalation of operating lease payments of certain leases depend on an existing index or rate, such as the consumer price index or the market interest rate. These are considered variable lease payments and are included in lease payments when the escalation is known.

Operating lease expense was as follows:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022
Operating lease cost (1)	$	58,132	$	55,608	$	169,916	$	163,271

(1) For the thirteen and thirty-nine weeks ended October 28, 2023, includes $14.3 million and $41.1 million, respectively, in variable lease costs. For the thirteen and thirty-nine weeks ended October 29, 2022, includes $9.7 million and $28.5 million, respectively, in variable lease costs.

Supplemental balance sheet information related to operating leases was as follows:


	October 28, 2023			January 28, 2023			October 29, 2022
Right of use assets	$	466,888		$	435,321		$	432,018

Current lease liabilities	$	150,053		$	153,202		$	157,687
Long-term lease liabilities	373,823			349,409			346,560
Total operating lease liabilities	$	523,876		$	502,611		$	504,247

Weighted Average Remaining Lease Term (years)	4.4			4.2			4.1

Weighted Average Discount Rate (1)	5.9		%	5.3		%	5.0		%

(1) The incremental borrowing rate used by the Company is based on the rate at which the Company could borrow funds using its credit rating for a collateralized loan of similar term to the lease. The weighted average discount rate represents a weighted average of the incremental borrowing rate for each lease, weighted based on the remaining fixed lease obligations.

Supplemental cash flow information related to operating leases was as follows:


	Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows	$	145,729	$	155,561
Right of use assets obtained in exchange for lease obligations, non-cash	145,342		88,484

Maturities of operating lease liabilities as of October 28, 2023 were as follows:


Fiscal Year Ending:
February 3, 2024	$	48,986
February 1, 2025	171,076
January 31, 2026	129,459
January 30, 2027	95,434
January 29, 2028	66,278
Thereafter	92,906
Total future minimum lease payments	$	604,139
Less imputed interest	(80,263)
Total	$	523,876

5. SHARE-BASED COMPENSATION

For the thirty-nine weeks ended October 28, 2023 and October 29, 2022, share-based compensation expense was $9.1 million and $10.3 million, respectively. As of October 28, 2023, approximately 10.4 million shares remain available for future grants of equity awards under our 2020 Omnibus Stock and Incentive Plan.

Restricted Stock Awards

Restricted stock awards vest in equal annual installments over a three-year period from the date of grant, except for a (i) restricted stock award granted to our then Chief Executive Officer in fiscal 2019, which vests over a four-year period from the date of grant, and (ii) restricted stock awards granted in March 2021, which vest 50% one year from the date of grant, 30% two years from the date of grant, and 20% three years from the date of grant.

Restricted stock award activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	4,611,801	$	4.02
Granted	2,146,506	5.85
Vested	(2,399,562)	3.77
Forfeited	(418,664)	5.02
Unvested, end of period	3,940,081	5.06

Restricted Stock Units

Restricted stock units vest 100% one year from the date of grant with certain rights to defer settlement in shares of our common stock, except for (i) restricted stock units granted in March 2021, which vest 50% one year from the date of grant, 30% two years from the date of grant, and 20% three years from the date of grant, and (ii) restricted stock units granted in March 2022, which vest in equal annual installments over a three-year period from the date of grant.

Restricted stock unit activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	406,218	$	2.46
Granted	27,462	5.28
Vested	(274,573)	2.17

Unvested, end of period	159,107	3.46

Performance-based Restricted Stock Units

During the thirty-nine weeks ended October 28, 2023, we granted performance-based restricted stock units (“PSUs”), contingent upon the achievement of Company-specific performance goals during the three fiscal years 2023 through 2025. Any units earned as a result of the achievement of the performance goals of the PSUs will vest three years from the date of grant and will be settled in shares of our common stock.

PSU activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Units/ Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	2,696,449	$	3.48
Granted	1,239,354	5.70
Vested	(753,078)	3.17
Forfeited	(193,703)	5.45
Unvested, end of period	2,989,022	4.35

6. INCOME TAXES

The provision for income taxes is based on a current estimate of the annual effective tax rate and is adjusted as necessary for quarterly events. Our effective income tax rate may fluctuate from quarter to quarter as a result of a variety of factors, including changes in our assessment of certain tax contingencies, valuation allowances, changes in tax law, outcomes of administrative audits, the impact of discrete items, and the mix of earnings across jurisdictions.

For the thirteen weeks ended October 28, 2023 and October 29, 2022, the Company’s effective tax rate was 50.3% and 19.3%, respectively. The effective tax rate of 50.3% for the thirteen weeks ended October 28, 2023 primarily reflects the impact of certain incurred and anticipated nondeductible Merger-related costs, and the Company’s projected annual pre-tax income, partially offset by a fiscal 2022 provision-to-return benefit related to federal tax credits. The 19.3% effective tax rate for the thirteen weeks ended October 29, 2022 primarily reflects the impact of a fiscal 2021 provision-to-return benefit due to the reversal of a valuation allowance related to temporary differences.

For the thirty-nine weeks ended October 28, 2023 and October 29, 2022, the Company’s effective tax rate was 4.3% and 23.2%, respectively. The effective tax rate of 4.3% for the thirty-nine weeks ended October 28, 2023 primarily reflects the non-cash benefit for the partial reversal of the valuation allowance on deferred tax assets, favorable share-based compensation benefit, and a fiscal 2022 provision-to-return benefit related to federal credits, offset by the impact of certain incurred and anticipated nondeductible Merger-related costs and the Company’s projected annual pre-tax income. The 23.2% effective tax rate for the thirty-nine weeks ended October 29, 2022 primarily reflects a provision to return benefit due to the reversal of a valuation allowance related to 2021 temporary differences and favorable share-based compensation benefit.

As of October 28, 2023, our unaudited condensed consolidated balance sheet reflected a $7.9 million income tax receivable related to the recovery of federal income taxes paid in prior years and other tax law changes as a result of the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act.

7. INCOME PER SHARE

In accordance with relevant accounting guidance, unvested share-based payment awards that include non-forfeitable rights to dividends, whether paid or unpaid, are considered participating securities. As a result, such awards are required to be included in the calculation of income per common share pursuant to the “two-class” method. For the Company, participating securities are comprised entirely of unvested restricted stock awards granted prior to fiscal 2020.

Net income per share is determined using the two-class method when it is more dilutive than the treasury stock method. Basic net income per share is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding during the period, including participating securities. Diluted net income per share reflects the dilutive effect of potential common shares from non-participating securities, such as restricted stock awards granted after fiscal 2019, stock options, PSUs, and restricted stock units.

The following table sets forth the computation of net income per basic and diluted share shown on the face of the accompanying condensed consolidated statements of income:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022

Numerator:
Net income	$	5,040	$	24,619	$	104,270	$	101,512
Net income allocated to participating securities	(2)		(47)		(113)		(370)
Net income available to common shareholders	$	5,038	$	24,572	$	104,157	$	101,142
Denominator:
Weighted average common shares outstanding – basic	119,457		120,333		119,424		119,776
Dilutive effect of non-participating securities	3,278		4,554		3,076		4,239
Weighted average common and common equivalent shares outstanding – diluted	122,735		124,887		122,500		124,016
Net income per common share:
Basic	$	0.04	$	0.20	$	0.87	$	0.84
Diluted	$	0.04	$	0.20	$	0.85	$	0.82

For the thirteen weeks ended October 28, 2023 and October 29, 2022, 0.0 million and 0.1 million potential shares of common stock, respectively, were excluded from the income per diluted common share calculation relating to non-participating securities, due to the antidilutive effect of including these shares.

For the thirty-nine weeks ended October 28, 2023 and October 29, 2022, 0.1 million and 0.1 million potential shares of common stock, respectively, were excluded from the income per diluted common share calculation relating to non-participating securities, due to the antidilutive effect of including these shares.

8. FAIR VALUE MEASUREMENTS

Our financial instruments generally consist of cash, money market accounts, marketable securities, assets held in our non-qualified deferred compensation plan, accounts receivable and payable, and debt. Cash, accounts receivable, and accounts payable are carried at cost, less reserves for credit losses, as applicable, which approximates their fair value due to the short-term nature of the instruments.

Marketable securities are classified as available-for-sale, and as of October 28, 2023, consisted of U.S. government agencies, corporate bonds, and commercial paper, with $22.2 million of securities with maturity dates within one year or less, and $2.5 million with maturity dates over one year.

We consider all marketable securities available-for-sale, including those with maturity dates beyond 12 months, and therefore classify these securities within current assets on the unaudited condensed consolidated balance sheets, as applicable, as they were available to support current operational liquidity needs. Marketable securities are carried at fair value, with the unrealized holding gains and losses, net of income taxes, reflected in accumulated other comprehensive gain (loss) until realized, and any credit risk-related losses recognized in net income during the period incurred. For the purposes of computing realized and unrealized gains and losses, cost is determined on a specific identification basis.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. Entities are required to use a three-level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels are defined as follows:


Level 1	—	Unadjusted quoted prices in active markets for identical assets or liabilities

Level 2	—	Unadjusted quoted prices in active markets for similar assets or liabilities; or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs other than quoted prices that are observable for the asset or liability

Level 3	—	Unobservable inputs for the asset or liability

Assets Measured on a Recurring Basis

We measure certain financial assets at fair value on a recurring basis, including our marketable securities, as applicable, which are classified as available-for-sale securities, certain cash equivalents, specifically our money market accounts and assets held in our non-qualified deferred compensation plan, as applicable. The money market accounts are valued based on quoted market prices in active markets. Our marketable securities are generally valued based on other observable inputs for those securities (including market corroborated pricing or other models that utilize observable inputs, such as interest rates and yield curves) based on information provided by independent third-party pricing entities, except for U.S. government securities, which are valued based on quoted market prices in active markets. The investments in our non-qualified deferred compensation plan are valued using quoted market prices and are included in other assets on our unaudited condensed consolidated balance sheets.

Assets Measured on a Nonrecurring Basis

From time to time, we measure certain assets at fair value on a nonrecurring basis when carrying value exceeds fair value. This measurement includes the evaluation of long-lived assets, goodwill, and other intangible assets for impairment using Company-specific assumptions that would fall within Level 3 of the fair-value hierarchy. Assets that are measured at fair value on a nonrecurring basis are remeasured when carrying value exceeds fair value. Carrying value after impairment approximates fair value.

We assess the carrying amount of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The Company uses market participant rents and a market participant discount rate to calculate the fair value of right of use assets. The Company uses discounted future cash flows of the asset or asset group using a discount rate that approximates the cost of capital of a market participant to quantify fair value for other long-lived assets within the asset group, which are primarily leasehold improvements. The asset group is defined as the lowest level for which identifiable cash flows are available and is largely independent of the cash flows of other groups of assets, which for our retail stores, is primarily at the store level.

To assess the fair value of goodwill, we have historically utilized both an income approach and a market approach. Inputs used to calculate the fair value based on the income approach primarily include estimated future cash flows, discounted at a rate that approximates the cost of capital of a market participant. Inputs used to calculate the fair value based on the market approach include identifying sales and EBITDA multiples based on guidelines for similar publicly traded companies and recent transactions.

To assess the fair value of trademarks, we utilize a relief from royalty approach. Inputs used to calculate the fair value of the trademarks primarily include future sales projections, discounted at a rate that approximates the cost of capital of a market participant, and an estimated royalty rate.

As of October 28, 2023, January 28, 2023, and October 29, 2022, our revolving loan and letter of credit facility approximates fair value, as this instrument has a variable interest rate that approximates current market rates (Level 2 criteria).

Fair value calculations contain significant judgments and estimates, which may differ from actual results due to, among other things, economic conditions, changes to the business model, or changes in operating performance.

We conduct reviews on a quarterly basis to verify pricing, assess liquidity, and determine if significant inputs have changed that would impact the fair value hierarchy disclosure.

In accordance with the provisions of the guidance, we categorized our financial assets and liabilities, which are valued on a recurring and nonrecurring basis, based on the priority of the inputs to the valuation technique for the instruments, as follows:


			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of October 28, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	18,255	$	18,255	$	—	$	—
Marketable securities:
U.S. government agencies	5,531		—		5,531		—
Corporate bonds	11,767		—		11,767		—
Commercial paper	7,404		—		7,404		—



Total recurring fair value measurements	$	42,957	$	18,255	$	24,702	$	—









			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of January 28, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	41,642	$	41,642	$	—	$	—
Marketable securities:


U.S. government agencies	5,506		—		5,506		—
Corporate bonds	12,802		—		12,802		—
Commercial paper	6,369		—		6,369		—



Total recurring fair value measurements	$	66,319	$	41,642	$	24,677	$	—








			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of October 29, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	42,596	$	42,596	$	—	$	—
Marketable securities:


U.S. government agencies	3,479		—		3,479		—
Corporate bonds	10,709		—		10,709		—
Commercial paper	8,829		—		8,829		—

Noncurrent Assets
Deferred compensation plan	4,776		4,776		—		—
Total recurring fair value measurements	$	70,389	$	47,372	$	23,017	$	—

9. DEBT

On February 2, 2022, the Company and certain material domestic subsidiaries entered into Amendment No. 2 (“Amendment”) to its credit agreement (as amended, “Credit Agreement”), originally entered into on August 2, 2018 and amended October 30, 2020, by and among the Company, certain material domestic subsidiaries as co-borrowers and guarantors, Wells Fargo Bank, National Association (“Wells Fargo Bank”), as Agent, letter of credit issuer, and swing line lender, and certain lenders party thereto. Our obligations under the Credit Agreement are guaranteed by the guarantors and are secured by a first-priority lien on certain assets of the Company and certain material domestic subsidiaries, including inventory, accounts receivable, cash deposits, certain insurance proceeds, real estate, fixtures, and certain intellectual property. The Credit Agreement provides for a five-year Asset-Based Lending senior secured revolving loan (“ABL”) and letter of credit facility of up to $285.0 million, maturing February 2, 2027. The interest rate applicable to Term Secured Overnight Financing Rate (“SOFR”) loans drawn under the ABL is equal to Term SOFR plus 1.60% (subject to a further decrease to Term SOFR plus 1.35% or an increase to Term SOFR plus 1.85% based upon average quarterly excess availability under the ABL). The Credit Agreement also provides for a $15.0 million first-in last-out (“FILO”) loan. The interest rate applicable to the FILO is equal to Term SOFR plus 3.60% (subject to a further decrease to Term SOFR plus 3.35% or an increase to Term SOFR plus 3.85% based on average quarterly excess availability under the FILO). However, for any ABL or FILO with a SOFR interest rate period of six months, the interest rate applicable to the ABL and FILO is increased by 30 basis points.

The Credit Agreement contains customary representations, warranties, and affirmative covenants, as well as customary negative covenants, that, among other things restrict, subject to certain exceptions, the ability of the Company and certain of its domestic subsidiaries to (i) incur liens, (ii) make investments, (iii) issue or incur additional indebtedness, (iv) undergo significant corporate changes, including mergers and acquisitions, (v) make dispositions, (vi) make restricted payments, (vii) prepay other indebtedness, and (viii) enter into certain other restrictive agreements. The Company may pay cash dividends and repurchase shares under its share buyback program, subject to certain thresholds of available borrowings, based upon the lesser of the aggregate amount of commitments under the Credit Agreement and the borrowing base, determined after giving effect to any such transaction or payment, on a pro forma basis. In addition, the Company must pay a commitment fee per annum on the unused portion of the commitments under the Credit Agreement.

As of October 28, 2023, $24.0 million in net borrowings were outstanding under the Credit Agreement. Availability under the Credit Agreement is determined based upon a monthly borrowing base calculation, which includes eligible credit card receivables, real estate, and inventory, less outstanding borrowings, letters of credit, and certain designated reserves. As of October 28, 2023, the available additional borrowing capacity under the Credit Agreement was approximately $265.1 million, inclusive of the current loan cap of $30.0 million.

As of October 28, 2023, deferred financing costs of $2.7 million were outstanding related to the Credit Agreement and are presented in other current assets in the accompanying unaudited condensed consolidated balance sheet.

10. SHARE REPURCHASES

During the thirty-nine weeks ended October 28, 2023, under our $300.0 million share repurchase program announced in November 2015 (“Prior Share Repurchase Program”), we repurchased 3.25 million shares at a total cost of approximately $19.8 million, at an average price of $6.09 per share. In June 2023, the Company authorized a new share repurchase program (“New Share Repurchase Program”) of up to $100.0 million of the Company’s common stock and cancelled the remaining $35.4 million available under the Prior Share Repurchase Program. As of October 28, 2023, the Company had $100.0 million remaining for future repurchases under the New Share Repurchase Program. However, we have no continuing obligation to repurchase shares under this authorization, and the timing, actual number, and purchase price of any shares purchased under the New Share Repurchase Program will depend on a variety of factors, including, but not limited to, the pending Merger, the market price of the Company’s common stock, general business and market conditions, other investment opportunities, and applicable legal and regulatory requirements.

11. SUPPLIER FINANCE PROGRAM

In September 2022, the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, which enhances the transparency about the use of supplier finance programs for investors and other allocators of capital. The Company entered into a supplier financing agreement administered by a third-party platform in the fourth quarter of 2022. Payments to suppliers through this program began in the third quarter of fiscal 2023. Inclusion in the supplier financing program is by sole discretion of the Company, offering participating suppliers early payment of invoices through a third-party financial institution. The Company negotiates payment terms with each supplier separately, and inclusion in the financing program does not impact amounts due. One supplier is currently participating in the program with 90-day payment terms. The Company may on occasion submit debit memos to the third-party financial institution, and the financial institution agrees to work with the Company in applying these credits to future payments to suppliers. During the thirteen weeks ended October 28, 2023, no payments were made for invoices submitted through the supplier financing program. The outstanding payment obligation to the financial institution under this program was $2.2 million as of October 28, 2023, which is 1.7% of total trade payables obligations to suppliers.

12. COMMITMENTS AND CONTINGENCIES

We are not currently a party to any material legal proceedings other than claims and lawsuits arising in the normal course of our business. All such matters are subject to uncertainties, and outcomes may not be predictable. Consequently, as of October 28, 2023, the ultimate aggregate amounts of monetary liability or financial impact with respect to such matters are not estimable. However, while such matters could affect our consolidated operating results when resolved in future periods, management believes that, upon final disposition, any monetary liability or financial impact to us would not be material to our annual consolidated financial statements.


ITEM 2.			MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s Discussion and Analysis of Financial Condition and Results of Operations, or MD&A, should be read in conjunction with the unaudited condensed consolidated financial statements and notes thereto included in this Quarterly Report on Form 10-Q (“this Form 10-Q”) and in our Annual Report on Form 10-K for the fiscal year ended January 28, 2023, filed with the Securities and Exchange Commission (“SEC”) on March 14, 2023 (“2022 Annual Report on Form 10-K”).

Executive Overview

Chico’s FAS, Inc. (“Company,” “we,” “us,” or “our”) is a Florida-based fashion company founded in 1983 on Sanibel Island, Florida. The Company reinvented the fashion retail experience by creating fashion communities anchored by service, which put the customer at the center of everything we do. As one of the leading fashion retailers in North America, Chico’s FAS is a company of three unique brands – Chico’s®, White House Black Market® (“WHBM”), and Soma® – each operating in their own white space, founded by women, led by women, providing solutions that millions of women say give them confidence and joy. We sometimes refer to our Chico’s and WHBM brands collectively as our “Apparel Group.” Our distinct lifestyle brands serve the needs of fashion-savvy women with household incomes in the moderate-to-high income level. We earn revenue and generate cash through the sale of merchandise in our domestic retail stores, our various Company-operated e-commerce websites, social commerce, our call center (which takes orders for all our brands), and through unaffiliated franchise partners.

We utilize an integrated, omnichannel approach to managing our business. We want our customers to experience our brands holistically and to view the various commerce channels we operate as a single, integrated experience rather than as separate sales channels operating independently. This approach allows our customers to browse, purchase, return, or exchange our merchandise through whatever sales channel, and at whatever time, is most convenient. As a result, we track total sales and comparable sales on a combined basis.

Our growth strategy is supported by the “power of three” unique brands and the “power of three” commerce channels. Our physical stores serve as community centers for entertainment and self-discovery, where our stylists and bra experts showcase our products and share their knowledge and enthusiasm for our brands. Our digital stores serve as a first impression of our brands and an efficient platform to teach and inspire our customers about our merchandise. Our social stylists – who are a combination of store associates, social media platform hosts and hyperlocal social stylists who arrange events within their communities – are an additional connection between our physical stores and digital.

Business Highlights

The Company’s third quarter highlights include:

•Consistent profitability: For the third quarter, the Company reported net income per diluted share of $0.04.

•Solid balance sheet: The Company ended the third quarter with $126.6 million in cash and marketable securities and total liquidity of $361.7 million, with $24.0 million in long-term debt.

•Pending Merger: On September 27, 2023, the Company entered into a definitive agreement (“Merger Agreement”), which is filed as Exhibit 2.1 to this Form 10-Q, to be acquired by Sycamore Partners, a private equity firm specializing in retail, consumer, and distribution-related investments, pursuant to which the Company’s shareholders would receive $7.60 per share in cash (“Merger”). If the Merger is successful, Chico’s FAS will become a privately held company. The Merger is expected to close by the end of the first calendar quarter of 2024, subject to both the approval by the Company’s shareholders and customary closing conditions. The Go-Shop Period has ended, and the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, has expired. In addition, the Company filed its Definitive Merger Proxy Statement on Schedule 14A with the Securities and Exchange Commission on November 29, 2023. The transaction is not subject to a financing condition.

Select Financial Results

The following table depicts select financial results for the thirteen and thirty-nine weeks ended October 28, 2023 and October 29, 2022:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022
	(in millions, except per share amounts)
Net sales	$	505	$	518	$	1,585	$	1,618

Income from operations (1)	11		32		110		135
Net income (2)	5		25		104		102
Net income per common and common equivalent share – diluted	$	0.04	$	0.20	$	0.85	$	0.82

(1) Includes $7.3 million in Merger-related costs during the third quarter of 2023.

(2) Includes a $25.6 million non-cash favorable impact of the tax valuation allowance reversal during the second quarter of 2023 and $8.0 million in Merger-related costs, after taxes, during the third quarter of 2023.

Current Trends

Our financial results, we believe, demonstrate that we are successfully executing on our four strategic pillars of customer led, product obsessed, digital first, and operationally excellent.

We offer our customers the ability to shop through three powerful platforms – digital, stores, and our social stylists. Our customers have proven to be resilient, and our multi-channel customers are especially valuable to us, spending three times more than single-channel customers. We continually work to assure we are meeting our customers’ demands with the right balance and styles of inventory and accommodating their evolving shopping preferences. We are constantly innovating and introducing new fashion, trends, and fabrications to our assortments. Over the last several years, we have made meaningful investments to transform our Company into a digital-first enterprise, fast-tracking numerous innovation and technology investments across all three brands to improve service, engagement, and decision making. In addition, we are disciplined in the way we manage our inventories, costs, real estate, and cash.

Our cash position, total liquidity, and operating cash flow remain strong, providing us with flexibility to manage the business, make investments to further propel our growth, and return excess cash to shareholders, as deemed appropriate. In addition to funding strategic investments, we believe our cash flow will allow us to navigate any economic developments that may arise over the coming quarters.

Looking ahead, we are well-positioned to react in this dynamic environment, further supported by a strong balance sheet. We are managing lean inventories; making prudent investments in digital, technology, and stores; and progressing on our key strategic initiatives that we expect will deliver both top- and bottom-line growth over the long term.

Outlook

Given the pending acquisition by Sycamore Partners, the Company is not providing a financial outlook and is withdrawing its previously issued outlook for fiscal 2023.

Key Performance Indicators

We consider a variety of key performance and financial measures to evaluate our business, develop financial forecasts, and make strategic decisions. These key measures include liquidity, comparable sales, gross margin, income per diluted share, and return on net assets (“RONA”). We remain focused on effectively managing our liquidity position, including aligning our operating cost structure with expected sales. We will continue to evaluate our key performance and financial measures, which are described below.

Liquidity

Liquidity is measured through cash flow, which is the measure of cash provided by, or used in, operating, investing, and financing activities. We believe we are able to effectively manage our liquidity position.

Comparable Sales

Comparable sales is an omnichannel measure of the amount of sales generated from products the Company sells directly to the consumer, relative to the amount of sales generated in the comparable prior-year period. Comparable sales is defined as sales from stores open for the preceding twelve months, including stores that have been expanded, remodeled, or relocated within the same general market, and also includes online and catalog sales. The comparable sales calculation excludes the negative impact of stores closed for four or more days.

Gross Margin

Gross margin is computed as gross profit divided by net sales. We believe gross margin is a primary metric to measure the performance of our business, as gross margin is used to determine the value of incremental sales, and to guide pricing and promotion decisions.

Income per Diluted Share

Income per share is determined using the two-class method when it is more dilutive than the treasury stock method. Income per basic share is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding during the period, including participating securities. Income per diluted share reflects the dilutive effect of potential common shares from non-participating securities, such as stock options, performance stock units, and restricted stock units. While income per basic share serves as an indicator of the Company’s profitability, we believe income per diluted share is a key performance measure because it gauges the Company’s quality of income per share, assuming all potential common shares from non-participating securities are exercised.

Return on Net Assets

RONA is defined as (i) net income divided by (ii) the “five-point average” (based on balances at the beginning of the first quarter plus the final balances for each quarter of the fiscal year) of net working capital less cash and marketable securities plus fixed assets. We believe RONA is a primary metric, as it helps to determine how well the Company is utilizing its assets. As such, a higher RONA could indicate that the Company is using its assets and working capital efficiently and effectively.

Our Business Strategy

We are focused on building a collection of distinct, high-performing retail brands primarily serving the fashion needs of women with moderate-to-high household income levels.

The primary function of the Company is the production, procurement, and sale of beautiful merchandise that delivers the promise and positioning of each of our brands and that resonates with customers. To that end, we are continually strengthening our merchandise and design capabilities, and enhancing our sourcing and supply chain to deliver product in a timely manner to our customers, while also focusing on improving the quality and aesthetic of our merchandise.

Over the long term, we may build our brand portfolio by organic development or acquisition of other specialty retail concepts if the opportunity complements our current brands, is appropriate, and is in the best interest of our shareholders.

We pursue improving the performance of our brands by building our omnichannel capabilities, growing our online presence, managing our store base, executing marketing plans, leveraging expenses effectively, considering additional sales channels and markets, and optimizing the merchandise offerings of each of our brands. We continue to invest heavily in our omnichannel capabilities so that our customers can fully experience our brands in the manner they choose.

We view our stores and Company-operated e-commerce websites as a single, integrated sales function rather than as separate, independently operated sales channels. As a result, we maintain a shared inventory platform for our primary operations, allowing us to fulfill orders for all channels from our distribution center (“DC”) in Winder, Georgia. Our domestic customers can return merchandise to a store or to our DC, regardless of the original purchase location. Using our enhanced “Locate” tool, we ship in-store orders from other locations directly to the customer, expediting delivery times while reducing our shipping costs. In addition, our shared inventory system enables customers to make purchases online that ship either from our DC or a store. Our mobile apps launched in 2022, following our previously introduced customized, branded, digital styling software tools, StyleConnect® and MY CLOSETSM, and Buy On-Line, Pick-up In-Store. We believe all of these digital tools are driving customer engagement, loyalty and cross-channel shopping.

We seek to acquire new customers and retain existing customers by leveraging existing customer-specific data and through targeted marketing, including digital marketing, social media, television, catalogs, and mailers. We seek to optimize the potential of our brands with innovative product offerings, potential new merchandise opportunities, and brand extensions that enhance the current offerings, as well as through continued emphasis on our “Most Amazing Personal Service” standard. We will also continue to consider potential alternative sales channels for our brands, including international franchise, wholesale, licensing, and other opportunities.

We are focused on driving profitable growth through four strategic pillars: customer led, product obsessed, digital first, and operationally excellent.

•By being customer-led, we are focused on building community engagement, creating exceptional customer experiences, and increasing customer lifetime value.

•We are product-obsessed, delivering best-in-class merchandise to our Chico’s, WHBM, and Soma customers, offering a continual pipeline of innovation and beautiful solutions that inspire confidence and joy. With each brand, we are focused on elevating average unit retail and driving full-priced sales growth.

•Being digital-first means we want to strengthen our core platform, data-driven insights, and decision-making. We are leveraging technology to engage and deliver to our customers across channels and brands.

•To be operationally excellent, we are continually focusing on diligently managing our inventory, cost of sales, supply chain, expenses, and real estate, while generating healthy cash flow and delivering a strong bottom line.

Results of Operations

Thirteen Weeks Ended October 28, 2023 Compared to the Thirteen Weeks Ended October 29, 2022

Net Income and Income per Diluted Share

For the third quarter, the Company reported net income of $5.0 million, or $0.04 per diluted share, compared to net income of $24.6 million, or $0.20 per diluted share, in last year’s third quarter. This year’s net income and earnings per diluted share include the impact of $8.0 million in Merger-related costs, after taxes.

Net Sales

The following table depicts net sales by Chico’s, WHBM, and Soma in dollars and as a percentage of total net sales for the thirteen weeks ended October 28, 2023 and October 29, 2022:


	Thirteen Weeks Ended
	October 28, 2023				October 29, 2022

	(dollars in millions)

Chico’s	$	252	49.9	%	$	255	49.3	%
WHBM	148		29.2		157		30.4
Soma	105		20.9		106		20.3

Total Net Sales	$	505	100.0	%	$	518	100.0	%

For the third quarter, net sales were $505.1 million compared to $518.3 million in last year’s third quarter. This decrease of 2.5% primarily reflects a comparable sales decrease of 2.7% since last year’s third quarter. The 2.7% comparable sales decline was driven by a decrease in transaction count, partially offset by an increase in average dollar sale.

The following table depicts comparable sales percentages by Chico’s, WHBM, and Soma for the thirteen weeks ended October 28, 2023 and October 29, 2022:


	Thirteen Weeks Ended
	October 28, 2023		October 29, 2022
	Compared to Fiscal 2022		Compared to Fiscal 2021
Chico’s	0.0	%	28.8	%
WHBM	(6.7)		17.0
Soma	(3.1)		(6.1)
Total Company	(2.7)		16.5

Cost of Goods Sold / Gross Margin

The following table depicts cost of goods sold and gross profit in dollars, and gross margin as a percentage of total net sales for the thirteen weeks ended October 28, 2023 and October 29, 2022:


	Thirteen Weeks Ended
	October 28, 2023			October 29, 2022

	(dollars in millions)
Cost of goods sold	$	309		$	311
Gross profit	196			207
Gross margin percentage	38.9		%	40.0		%

For the third quarter, gross profit was $196.4 million, or 38.9% of net sales, compared to $207.4 million, or 40.0% of net sales, in last year’s third quarter. This 110-basis-point decrease in gross margin primarily reflects higher occupancy costs, as well as deleverage on lower net sales.

Selling, General, and Administrative Expenses

The following table depicts selling, general, and administrative expenses (“SG&A”), which includes store and direct operating expenses, marketing expenses, and National Store Support Center (“NSSC”) expenses, in dollars and as a percentage of total net sales for the thirteen weeks ended October 28, 2023 and October 29, 2022:


	Thirteen Weeks Ended
	October 28, 2023			October 29, 2022

	(dollars in millions)
Selling, general, and administrative expenses	$	179		$	176
Percentage of total net sales	35.4		%	33.9		%

For the third quarter, SG&A was $178.6 million, or 35.4% of net sales, compared to $175.8 million, or 33.9% of net sales, for last year’s third quarter. The 150 basis points of deleverage primarily reflects increased marketing and store operating expenses to support our long-term growth strategies.

Merger-Related Costs

Merger-related costs of $7.3 million were recognized during the period.


	Thirteen Weeks Ended
	October 28, 2023			October 29, 2022

	(dollars in millions)
Merger-related costs	$	7		$	—
Percentage of total net sales	1.4		%	—		%

Income Taxes

The third quarter effective tax rate was 50.3% compared to 19.3% for last year’s third quarter. This year’s effective tax rate primarily reflects the impact of certain incurred and anticipated nondeductible Merger-related costs, and the Company’s projected annual pre-tax income, partially offset by a fiscal 2022 provision-to-return benefit related to federal tax credits. Last year’s third quarter effective tax rate primarily reflected the impact of a fiscal 2021 provision-to-return benefit due to the reversal of a valuation allowance related to temporary differences.

Thirty-Nine Weeks Ended October 28, 2023 Compared to the Thirty-Nine Weeks Ended October 29, 2022

Net Income and Income per Diluted Share

For the thirty-nine weeks ended October 28, 2023, the Company reported net income of $104.3 million, or $0.85 per diluted share, compared to net income of $101.5 million, or $0.82 per diluted share, for the thirty-nine weeks ended October 29, 2022. This year’s net income and earnings per diluted share include the impact of a $25.6 million non-cash tax benefit and the $8.0 million Merger-related costs, after taxes.

Net Sales

The following table depicts net sales by Chico’s, WHBM, and Soma in dollars and as a percentage of total net sales for the thirty-nine weeks ended October 28, 2023 and October 29, 2022:


	Thirty-Nine Weeks Ended
	October 28, 2023				October 29, 2022

	(dollars in millions)
Chico’s	$	800	50.5	%	$	802	49.5	%
WHBM	451		28.4		485		30.0
Soma	334		21.1		331		20.5

Total net sales	$	1,585	100.0	%	$	1,618	100.0	%

Net sales for the thirty-nine weeks ended October 28, 2023 decreased to $1,585 million from $1,618 million for the thirty-nine weeks ended October 29, 2022. This 2.0% decrease primarily reflects the comparable sales decrease of 2.1% driven by a decrease in transaction count and average dollar sale.

The following table depicts comparable sales percentages by Chico’s, WHBM, and Soma for the thirty-nine weeks ended October 28, 2023:


	Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022
	Compared to Fiscal 2022		Compared to Fiscal 2021
Chico's	0.7	%	36.0	%
WHBM	(6.8)		35.6
Soma	(2.0)		(5.8)
Total Company	(2.1)	%	24.7	%

Cost of Goods Sold / Gross Margin

The following table depicts cost of goods sold and gross profit in dollars and gross margin, as well as gross margin as a percentage of total net sales, for the thirty-nine weeks ended October 28, 2023 and October 29, 2022:


	Thirty-Nine Weeks Ended
	October 28, 2023			October 29, 2022

	(dollars in millions)
Cost of goods sold	$	947		$	962
Gross profit	638			656
Gross margin percentage	40.3		%	40.5		%

Gross profit for the thirty-nine weeks ended October 28, 2023 was $638.4 million, or 40.3% of net sales, compared to $655.5 million, or 40.5% of net sales, for the thirty-nine weeks ended October 29, 2022. The 20-basis-point decrease in gross margin primarily reflects higher raw material and occupancy costs, partially offset by lower inbound freight costs, disciplined expense management, and higher average unit retail.

Selling, General, and Administrative Expenses

The following table depicts SG&A, which includes store and direct operating expenses, marketing expenses and NSSC expenses, in dollars and as a percentage of total net sales, for the thirty-nine weeks ended October 28, 2023 and October 29, 2022:


	Thirty-Nine Weeks Ended
	October 28, 2023			October 29, 2022

	(dollars in millions)
Selling, general, and administrative expenses	$	521		$	520
Percentage of total net sales	32.8		%	32.1		%

For the thirty-nine weeks ended October 28, 2023, SG&A was $521 million, or 32.8% of net sales, compared to $520 million, or 32.1% of net sales, for the thirty-nine weeks ended October 29, 2022. The increase in SG&A as a percent of total net sales primarily reflects increased store operating and marketing expenses to support our long-term growth strategies, partially offset by disciplined expense management.

Merger-Related Costs

Merger-related costs of $7.3 million were recognized during the period.


	Thirty-Nine Weeks Ended
	October 28, 2023			October 29, 2022

	(dollars in millions)
Merger-related costs	$	7		$	—
Percentage of total net sales	0.5		%	—		%

Income Taxes

The effective tax rate for the thirty-nine weeks ended October 28, 2023 and October 29, 2022 was 4.3% and 23.2%, respectively. The 4.3% effective tax rate for the thirty-nine weeks ended October 28, 2023 primarily reflects the non-cash benefit for the partial reversal of the valuation allowance on deferred tax assets, favorable share-based compensation benefit, and a fiscal 2022 provision-to-return benefit related to federal credits, offset by the impact of certain incurred and anticipated nondeductible Merger-related costs and the Company’s projected annual pre-tax income. The effective tax rate of 23.2% for the thirty-nine weeks ended October 29, 2022 reflects a provision-to-return benefit due to the reversal of a valuation allowance related to 2021 temporary differences and favorable share-based compensation benefit.

Balance Sheet

At the end of the third quarter, cash and marketable securities totaled $126.6 million compared to $140.7 million at the end of last year’s third quarter.

Long-term debt at the end of the third quarter totaled $24.0 million compared to $69.0 million at the end of last year’s third quarter, reflecting principal payments of $25.0 million in the first quarter of fiscal year 2023 and $20.0 million in the fourth quarter of fiscal year 2022.

At the end of the third quarter, inventories totaled $342.7 million compared to $304.1 million at the end of last year’s third quarter. The increase of $38.6 million, or 12.7%, reflects an increase of $19.8 million in on-hand inventories and $18.8 million in in-transit inventories to support anticipated holiday sales.

Income Tax Receivable

At the end of the third quarter, our unaudited condensed consolidated balance sheet reflected a $7.9 million income tax receivable related to the recovery of federal income taxes paid in prior years and other tax law changes as a result of the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act.

Liquidity and Capital Resources

The Company’s material cash requirements include amounts outstanding under operating leases, open purchase orders for inventory, other operating expenses in the normal course of business, contractual commitments for future capital expenditures, long-term debt obligations, and interest payments on long-term debt. Our ongoing capital requirements will continue to be primarily for enhancing and expanding our omnichannel capabilities, including investments in our stores, information technology, and supply chain.

We anticipate satisfying our material cash requirements from our cash flows from operating activities, our cash on hand, capacity within our credit facility, and other liquidity options.

The following table summarizes cash flows for the year-to-date period ended October 28, 2023 compared to last year’s year-to-date period ended October 29, 2022:


	Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022
	(in millions) (1)
Net cash provided by operating activities	$	36	$	84
Net cash used in investing activities	(35)		(42)
Net cash used in financing activities	(52)		(39)

Net (decrease) increase in cash and cash equivalents	$	(51)	$	3

(1) Values may not foot due to rounding.

Operating Activities

Net cash provided by operating activities for the year-to-date period of fiscal 2023 was $35.5 million compared to $83.6 million in last year’s the year-to-date period. The change in net cash provided by operating activities primarily reflects a reduction in income tax liabilities, increase in inventories, lower incentive compensation accrual, and the timing of pre-paid expenses, which includes an increase in cloud software spend net of amortization.

Investing Activities

Net cash used in investing activities for the year-to-date period of fiscal 2023 was $35.4 million compared to $41.7 million in last year’s year-to-date period, reflecting a net $23.3 million decrease in investments made in marketable securities and a $14.3 million increase in capital spending in comparison to the prior year.

Financing Activities

Net cash used in financing activities for the year-to-date period of fiscal 2023 was $51.5 million compared to $39.3 million used in last year’s year-to-date period. The change in net cash used in financing activities primarily reflects approximately $19.8 million in share repurchases, partially offset by the $5.0 million decrease in payments made on borrowings and $1.8 million less in payments of tax withholding related to the vesting of share-based awards.

Credit Facility

On February 2, 2022, the Company and certain material domestic subsidiaries entered into Amendment No. 2 (“Amendment”) to its credit agreement (as amended, “Credit Agreement”) originally entered into on August 2, 2018 and amended October 30, 2020, by and among the Company, certain material domestic subsidiaries as co-borrowers and guarantors, Wells Fargo Bank, National Association (“Wells Fargo Bank”), as Agent, letter of credit issuer and swing line lender, and certain lenders party thereto. Our obligations under the Credit Agreement are guaranteed by the guarantors and are secured by a first-priority lien on certain assets of the Company and certain material domestic subsidiaries, including inventory, accounts receivable, cash deposits, certain insurance proceeds, real estate, fixtures, and certain intellectual property. The Credit Agreement provides for a five-year Asset-Based Lending senior secured revolving loan (“ABL”) and letter of credit facility of up to $285.0 million, maturing February 2, 2027. The interest rate applicable to Term Secured Overnight Financing Rate (“SOFR”) loans drawn under the ABL is equal to Term SOFR plus 1.60% (subject to a further decrease to Term SOFR plus 1.35% or an increase to Term SOFR plus 1.85% based upon average quarterly excess availability under the ABL). The Credit Agreement also provides for a $15.0 million first-in last-out (“FILO”) loan. The interest rate applicable to the FILO is equal to Term SOFR plus 3.60% (subject to a further decrease to Term SOFR plus 3.35% or an increase to Term SOFR plus 3.85% based on average quarterly excess availability under the FILO). However, for any ABL or FILO with a SOFR interest rate period of six months, the interest rate applicable to the ABL and FILO is increased by 30 basis points.

The Credit Agreement contains customary representations, warranties, and affirmative covenants, as well as customary negative covenants, that, among other things, restrict, subject to certain exceptions, the ability of the Company and certain of its domestic subsidiaries to: (i) incur liens, (ii) make investments, (iii) issue or incur additional indebtedness, (iv) undergo significant corporate changes, including mergers and acquisitions, (v) make dispositions, (vi) make restricted payments, (vii) prepay other indebtedness, and (viii) enter into certain other restrictive agreements. The Company may pay cash dividends and repurchase shares under its share buyback program, subject to certain thresholds of available borrowings based upon the lesser of (i) the aggregate amount of commitments under the Credit Agreement and (ii) the borrowing base, determined after giving effect to any such transaction or payment, on a pro forma basis. In addition, the Company must pay a commitment fee per annum on the unused portion of the commitments under the Credit Agreement.

Store and Franchise Activity

Stores continue to be an important part of our omnichannel strategy, and digital sales are typically higher in markets where we have a retail presence. We will continue to actively manage our real estate portfolio, reflecting our digital-first strategy and our higher overall store and Company profitability standards. We will continue to adjust our store base, as appropriate, to align with these standards, primarily as leases come due, lease kickouts are available, or buyouts make economic sense.

We closed net 13 underperforming locations during the thirty-nine weeks ended October 28, 2023, ending the third quarter with 1,256 boutiques. This year, the Company has upgraded approximately 60 Chico’s boutiques. With respect to Soma, we have opened two of the three stores planned for this year.

As of October 28, 2023, the Company’s franchise operations consisted of 58 international retail locations in Mexico and two domestic airport locations.

Critical Accounting Estimates

The discussion and analysis of our financial condition and results of operations are based upon the condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of condensed consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, expenses, and related disclosure of contingent assets and liabilities. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board and believes the assumptions and estimates, as set forth in our 2022 Annual Report on Form 10-K, are significant to reporting our results of operations and financial position. There have been no material changes to our critical accounting estimates as disclosed in our 2022 Annual Report on Form 10-K.

Forward-Looking Statements

This Quarterly Report on Form 10-Q (“Form 10-Q”) may contain statements concerning our current expectations, assumptions, plans, estimates, judgments, and projections about our business and our industry, and other statements that are not historical facts. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. In most cases, words or phrases such as “aim,” “anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “target,” “may,” “will,” “plans,” “path,” “outlook,” “project,” “should,” “strategy,” “potential,” “confident,” “assumptions,” and similar expressions identify forward-looking statements. These forward-looking statements are based largely on information currently available to our management and are subject to various risks and uncertainties that could cause actual results to differ materially from historical results or those expressed or implied by such forward-looking statements. Although we believe our expectations are based on reasonable estimates and assumptions, our expectations are not guarantees of performance. There is no assurance that our expectations will occur or that our estimates or assumptions will be correct, and we caution investors and all others not to place undue reliance on such forward-looking statements. Factors that could cause actual results to differ include, but are not limited to, those factors described in our Definitive Merger Proxy Statement on Schedule 14A, filed with the Securities and Exchange Commission on November 29, 2023; in Item 1A, “Risk Factors” in our most recent Annual Report on Form 10-K; and, from time to time, in Item 1A, “Risk Factors” in our Quarterly Reports on Form 10-Q, and the following:

•the ability of our suppliers, logistics providers, vendors, and landlords to meet their obligations to us in light of financial stress, labor shortages, liquidity challenges, bankruptcy filings by other industry participants, and supply chain and other disruptions;

•our ability to sufficiently staff our retail stores;

•changes in general economic conditions, including, but not limited to, consumer confidence and spending patterns;

•the impacts of rising inflation, gasoline prices, and interest rates on consumer spending;

•the availability of, and interest rates on, consumer credit;

•the impact of consumer debt levels and consumers’ ability to meet credit obligations;

•market disruptions, including pandemics or significant health hazards, severe weather conditions, natural disasters, terrorist activities, financial crises, adverse developments affecting the financial services industry, political and social crises, war and other military conflicts (such as the war in Ukraine and the Israel-Hamas war) or other major events, or the prospect of these events (including their impact on consumer spending, inflation, and the global supply chain);

•shifts in consumer behavior, and our ability to adapt, identify, and respond to new and changing fashion trends and customer preferences, and to coordinate product development with buying and planning;

•changes in the general or specialty retail or apparel industries, including significant decreases in market demand and the overall level of spending for women’s private-branded clothing and related accessories;

•our ability to secure and maintain customer acceptance of in-store and online concepts and styles;

•our ability to maintain strong relationships with our vendors, manufacturers, licensors, and retail customers;

•increased competition in the markets in which we operate, including for, among other things, premium mall space;

•our ability to remain competitive with customer shipping terms and costs;

•decreases in customer traffic at malls, shopping centers, and our stores;

•fluctuations in foreign currency exchange rates and commodity prices;

•significant increases in the costs of manufacturing, raw materials, transportation, importing, distribution, labor, and advertising;

•decreases in the quality of merchandise received from suppliers and increases in delivery times for receiving such merchandise;

•our ability to appropriately manage our store fleet;

•our ability to achieve the expected results of any store openings or store closings;

•our ability to appropriately manage inventory and allocation processes and leverage targeted promotions;

•our ability to maintain cost-saving discipline; our ability to generate sufficient cash flow;

•our ability to operate our retail websites in a profitable manner;

•our ability to successfully identify and implement additional sales and distribution channels;

•changes in the timing of holidays or in the onset of seasonal weather affecting period-to-period sales comparisons;

•our ability to successfully execute and achieve the expected results of our business, brand strategies, brand awareness programs, and merchandising and marketing programs, including, but not limited to, the Company’s rewards programs and its three-year strategic growth plan, sales initiatives, multi-channel strategies, and four strategic pillars, which are (1) customer led, (2) product obsessed, (3) digital first, and (4) operationally excellent;

•our ability to utilize our Fort Myers campus, our distribution center, and our other support facilities in an efficient and effective manner;

•our reliance on sourcing from foreign suppliers;

•significant adverse economic, labor, political, or other shifts (including adverse changes in tariffs, taxes, or other import regulations, particularly with respect to China or Vietnam, or legislation prohibiting certain imports from China or Vietnam);

•U.S. and foreign governmental actions and policies, and changes thereto;

•the continuing performance, implementation, and integration of our management information systems;

•our ability to successfully update and maintain our information systems;

•the impact of any system failure, cybersecurity, or other data security breaches, including any security breaches resulting in the theft, transfer, or unauthorized disclosure of customer, employee, or company information that we or our third-party vendors may experience;

•the risks that our share repurchase program may not successfully enhance shareholder value, or that share repurchases could be negatively perceived by investors;

•our ability to comply with applicable domestic and foreign information security and privacy laws, regulations, and technology platform rules or other obligations related to data privacy and security;

•our ability to attract, hire, train, motivate, and retain qualified employees in an inclusive environment;

•our ability to successfully recruit leadership or transition members of our senior management team;

•increased public focus and opinion on environmental, social, and governance (“ESG”) initiatives and our ability to meet any announced ESG goals and initiatives;

•future unsolicited offers to buy the Company and actions of activist shareholders and others, and our ability to respond effectively;

•our ability to secure and protect our trademark and other intellectual property rights;

•our ability to protect our reputation and our brand images;

•unanticipated obligations or changes in estimates arising from new or existing litigation, income taxes, and other regulatory proceedings;

•unanticipated adverse changes in legal, regulatory, or tax laws;

•our ability to comply with the terms of our credit agreement, including the restrictive provisions limiting our flexibility in operating our business and in obtaining additional credit on commercially reasonable terms;

•the completion of the pending acquisition by Sycamore Partners (“Merger”) – pursuant to the Agreement and Plan of Merger, dated September 27, 2023, by and among Daphne Parent LLC, Daphne Merger Sub, Inc., and the Company (“Merger Agreement”), which is filed as Exhibit 2.1 to this Form 10-Q – on the anticipated terms and timing, or at all;

•the occurrence of any event, change, or other circumstance that could give rise to the termination of the Merger Agreement, including in circumstances requiring the Company to pay a termination fee;

•potential litigation relating to the Merger that could be instituted against the Company or its directors or officers, including the effects of any outcomes related thereto;

•the risk that disruptions from the Merger will harm the Company’s business, including current plans and operations;

•the ability of the Company to retain and hire key personnel during the pendency of the Merger;

•the diversion of management’s time and attention from ordinary course business operations to completion of the Merger;

•potential adverse reactions or changes to business relationships resulting from the announcement or completion of the Merger;

•potential business uncertainty, including changes to existing business relationships, during the pendency of the Merger; and

•certain restrictions during the pendency of the Merger that may impact the Company’s ability to pursue certain business opportunities or strategic transactions.

These factors should be considered in evaluating forward-looking statements contained herein. All forward-looking statements that are made, or are attributable to us, are expressly qualified in their entirety by this cautionary notice. The forward-looking statements included herein are only made as of the date of this Form 10-Q. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.


ITEM 3.			QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The market risk of our financial instruments as of October 28, 2023 has not materially changed since January 28, 2023. We are exposed to market risk from changes in interest rates on any future indebtedness and our marketable securities and also from foreign currency exchange rate fluctuations.

Our exposure to interest rate risk relates in part to our Credit Agreement with Wells Fargo Bank, which is further discussed in Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in Item 1, Note 9 to the accompanying unaudited condensed consolidated financial statements included in this Form 10-Q. The interest rate applicable to Term SOFR loans drawn under the ABL is equal to Term SOFR plus 1.60% (subject to a further decrease to Term SOFR plus 1.35% or an increase to Term SOFR plus 1.85% based upon average quarterly excess availability under the ABL). The Credit Agreement also provides for a $15.0 million FILO loan. The interest rate applicable to the FILO is equal to Term SOFR plus 3.60% (subject to a further decrease to Term SOFR plus 3.35% or an increase to Term SOFR plus 3.85% based on average quarterly excess availability under the FILO). However, for any ABL or FILO with a SOFR interest rate period of six months, the interest rate applicable to the ABL and FILO is increased by 30 basis points. As of October 28, 2023, $24 million in borrowings was outstanding under the Credit Agreement and is reflected as long-term debt in the accompanying unaudited condensed consolidated balance sheet. An increase in market interest rates of 100 basis points would increase interest expense in the amount of approximately $0.8 million over the remaining term of the loan.

Our investment portfolio is maintained in accordance with our investment policy, which identifies allowable investments, specifies credit quality standards, and limits the credit exposure of any single issuer. Our investment portfolio consists of cash equivalents and marketable securities, which includes U.S. government agencies, corporate bonds and commercial paper. The marketable securities portfolio as of October 28, 2023 consisted of $22.2 million of securities with maturity dates within one year or less and $2.5 million with maturity dates over one year. We consider all securities available-for-sale, including those with maturity dates beyond 12 months, and therefore classified these securities, as applicable, as short-term investments within current assets on the consolidated balance sheets, as they are available to support current operational liquidity needs.


ITEM 4.			CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Our disclosure controls and procedures are designed to provide reasonable assurance that information required to be disclosed in our reports under the Securities Exchange Act of 1934, as amended (“Exchange Act”), is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms.

As of the end of the period covered by this report, an evaluation was carried out under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based upon that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of the end of such period, our disclosure controls and procedures were effective in providing reasonable assurance in timely alerting each such officer to material information relating to us (including our consolidated subsidiaries) and that information required to be disclosed in our reports is recorded, processed, summarized and reported as required to be included in our periodic SEC filings.

Changes in Internal Controls

There was no change in our internal controls over financial reporting or in other factors during the quarterly period covered by this report that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION


ITEM 1.			LEGAL PROCEEDINGS

Information regarding legal proceedings is incorporated by reference from Note 12 to our unaudited condensed consolidated financial statements included in this Form 10-Q under the heading “Commitments and Contingencies.”


ITEM 1A.			RISK FACTORS

In addition to the other information discussed in this report, the factors described in Part I, Item 1A. “Risk Factors” in our 2022 Annual Report on Form 10-K and in Part II, Item 1A. “Risk Factors” in our Quarterly Report on Form 10-Q for the quarterly period ended July 29, 2023 should be considered, as they could materially affect our business, financial condition, or future results. Except as presented below, there have been no material changes with respect to the risks described in our 2022 Annual Report on Form 10-K, our Quarterly Report on Form 10-Q for the quarterly period ended July 29, 2023, and as described in our Preliminary Proxy Statement, filed with the SEC on Schedule 14A on November 16, 2023, but these are not the only risks facing our Company. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial, also may adversely affect our business, financial condition, or results from operations.


Risk			Description

1. The pendency of the Merger could have a material adverse effect on our business, consolidated financial condition or results of operations, or the market price of our common stock.			On September 27, 2023, the Company entered into the Merger Agreement. During the period between the date of the signing of the Merger Agreement and the closing of the Merger, our business has been and is exposed to certain inherent risks due to the effect of the announcement and the pendency of the Merger, including the following: • difficulties maintaining relationships with customers and business partners, who may defer decisions about working with us, move to our competitors, or seek to delay or change existing business relationships with us; • uncertainties caused by negative sentiment in the marketplace with respect to the Merger, which could adversely impact investor confidence in our business; • our inability to retain and hire key personnel during the pendency of the Merger, as our personnel may experience uncertainty about their future roles following the Merger; • diversion of our management’s time and attention, as well as distraction of our key personnel, from the Company’s ordinary course of business operations; • the occurrence of any event, change, or other circumstance that could give rise to the termination of the Merger Agreement, including in circumstances requiring the Company to pay a termination fee; and • our inability to solicit other acquisition proposals, pursue alternative business opportunities, make strategic changes to our business, and other restrictions on our ability to conduct our business pursuant to the Merger Agreement.


2. The Merger may not be completed within the expected timeframe, or at all, and any significant delay or the failure to complete the Merger could adversely affect our business, consolidated financial condition or results of operations, or the market price of our common stock.			There can be no assurance that the Merger will be completed within the intended timeframe, or at all. If the Merger is not completed within the intended timeframe or at all, or if the Merger is significantly delayed, we may be subject to a number of material risks, including the following: • to the extent that the current market price of our common stock reflects an assumption that the Merger will be completed, the market price may be negatively impacted because of a failure to complete the Merger within the expected timeframe, or at all; • we could be subject to litigation related to any failure to complete the Merger; • we have incurred, and expect to continue incurring, significant costs, expenses, and fees for professional services and other Merger-related costs, for which we may receive little or no benefit if the Merger is not completed, and many of these fees and costs will be payable by us even if the Merger is not completed; and • a significant delay in completing the Merger or the failure to complete the Merger may result in negative publicity, which, in turn, could negatively affect our relationships with business partners and could impact investor and consumer confidence in our business. The occurrence of any of these events individually or in combination could materially adversely affect our business, consolidated financial condition or results of operations, or the market price of our common stock.
3. Shareholder litigation could prevent or delay the closing of the Merger or otherwise negatively impact our business, consolidated financial condition or results of operations, or the market price of our common stock.			We may incur additional costs in connection with the defense or settlement of any future shareholder litigation related to the pending Merger. Such litigation may adversely affect our ability to complete the Merger. We could incur significant costs in connection with any such litigation, including costs associated with the indemnification of obligations to our directors, which could adversely affect our business, consolidated financial condition or results of operations, or the market price of our common stock.


ITEM 2.			UNREGISTERED SALES OF EQUITY SECURITIES, USE OF PROCEEDS, AND ISSUER PURCHASES OF EQUITY SECURITIES

The following table sets forth information concerning our purchases of common stock for the periods indicated (in thousands, except share and per share amounts):


Period	Total Number of Shares Purchased (a)	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans (b)	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Publicly Announced Plans
July 30, 2023 - August 26, 2023	100,420	$	5.37	—	$	100,000
August 27, 2023 - September 30, 2023	5,845		5.04	—		100,000
October 1, 2023 - October 28, 2023	14,697		7.49	—		100,000
Total	120,962		5.61	—

(a) Total number of shares purchased consists of 120,962 shares of restricted stock repurchased in connection with employee tax withholding obligations under employee compensation plans, which are not purchases under any publicly announced plan.

(b) In June 2023, the Company authorized a new share repurchase program (“New Share Repurchase Program”) of up to $100 million of the Company’s common stock and cancelled the remaining $35.4 million available under the Prior Share Repurchase Program. There was $100 million remaining under the New Share Repurchase Program as of October 28, 2023. The New Share Repurchase Program has no specific termination date and will expire when the Company has repurchased all securities authorized for repurchase thereunder, unless terminated earlier by the Board. The Company has no obligation to repurchase shares under this authorization, and the timing, actual number, and purchase price of any shares purchased under the New Share Repurchase Program will depend on a variety of factors, including, but not limited to, the pending Merger, the market price of the Company’s common stock, general business and market conditions, other investment opportunities, and applicable legal and regulatory requirements.


ITEM 5.			OTHER INFORMATION

During the three months ended October 28, 2023, none of the Company’s directors or officers (as defined in Rule 16a-1(f) of the Exchange Act) adopted, modified or terminated a Rule 10b5-1 trading arrangement or non-Rule 10b5-1 trading arrangement (as such terms are defined in Item 408 of Regulation S-K of the Securities Act of 1933, as amended).


ITEM 6.			EXHIBITS

(a)The following documents are filed as exhibits to this Form 10-Q:


			Exhibit 2.1						Agreement and Plan of Merger, dated as of September 27, 2023, by and among Daphne Parent LLC, Daphne Merger Sub, Inc. and Chico’s FAS, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Form 8-K, as filed with the SEC on September 28, 2023)

			Exhibit 10.1						First Amendment to Chico’s FAS, Inc. - 2021 Employee Stock Purchase Plan, effective September 27, 2023

			Exhibit 10.2						Indemnification Agreement with Wendy Hufford, dated as of July 26, 2023

			Exhibit 31.1						Chico’s FAS, Inc. and Subsidiaries Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Executive Officer

			Exhibit 31.2						Chico’s FAS, Inc. and Subsidiaries Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 - Chief Financial Officer

			Exhibit 32.1						Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

			Exhibit 32.2						Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

			Exhibit 101						The following financial statements from the Company’s Quarterly Report on Form 10-Q for the Quarter Ended October 28, 2023, formatted in Inline XBRL: (i) Condensed Consolidated Statements of Income; (ii) Condensed Consolidated Statements of Comprehensive Income; (iii) Condensed Consolidated Balance Sheets; (iv) Condensed Consolidated Statements of Shareholders’ Equity; (v) Condensed Consolidated Statements of Cash Flows; and (vi) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tags

			Exhibit 104						The cover page from the Company’s Quarterly Report on Form 10-Q for the Quarter Ended October 28, 2023, formatted in Inline XBRL (included within Exhibit 101)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

CHICO'S FAS, INC.

Date:

November 30, 2023

By:

/s/ Molly Langenstein

Molly Langenstein

Chief Executive Officer, President and Director

Date:

November 30, 2023

By:

/s/ David M. Oliver

David M. Oliver

Executive Vice President – Chief Financial Officer and Chief Accounting Officer

Exhibit 10.1

FIRST AMENDMENT TO

CHICO’S FAS, INC.

2021 EMPLOYEE STOCK PURCHASE PLAN

Pursuant to the Agreement and Plan of Merger by and among Chico’s FAS, Inc. (“Company”), Daphne Parent LLC, and Daphne Merger Sub, Inc. dated as of September 27, 2023, and the authority granted under Section 8.4(a) of the Chico’s FAS, Inc. 2021 Employee Stock Purchase Plan (“Plan”), the Board of Directors of the Company approved certain amendments to the Plan effective as of September 27, 2023 as set forth below.

1. The following new Article 9 is added to the Plan:

ARTICLE 9

Plan Freeze and Contingent Termination

9.1 Plan Freeze. Effective as of September 27, 2023 (“Amendment Date”), the Plan is amended as described in this Article 9. This Article 9 overrides all other inconsistent provisions in the Plan. Furthermore:

(a) Except for the Offering Period ending on October 31, 2023, no Offering Period under the Plan will be authorized or commenced after the Amendment Date;

(b) No employee is permitted to commence participation or enroll as a Participant under the Plan after the Amendment Date;

(c) No Participant enrolled under the Plan as of the Amendment Date is permitted to increase such Participant’s payroll deduction election or contribution rate in effect as of the Amendment Date or to make separate non-payroll contributions on or after the Amendment Date, except as may be required by applicable law;

(d) Each purchase right under the Plan that is outstanding as of the Amendment Date shall automatically be exercised on the final October 31, 2023 Purchase Date in accordance with the terms of the Plan;

(e) Each Participant’s accumulated payroll contributions held in such Participant’s Account under the Plan shall be used to purchase shares of Common Stock for such Participant on the final October 31, 2023 Purchase Date in accordance with the terms of the Plan, and any balance remaining in such Participant’s Account after the final October 31, 2023 Purchase Date will be refunded to such Participant as soon as practicable; and

(f) After the Amendment Date, cash dividends, if any, paid with respect to shares of Common Stock held in each Participant’s ESPP Account under the Plan shall be paid to such Participant in cash and shall not be reinvested in Common Stock under the Plan.

9.2 Contingent Termination. In accordance with Section 2.8(f) of the Agreement and Plan of Merger by and among the Company, Daphne Parent LLC, and Daphne Merger Sub, Inc., dated as of September 27, 2023 (“Merger Agreement”), the Plan is hereby terminated effective as of immediately prior to the “Effective Time” (as defined in Section 2.2 of the Merger Agreement), subject to the consummation of the merger as contemplated in the Merger Agreement.

2. This First Amendment to the Plan is adopted and effective September 27, 2023. All other provisions of the Plan not inconsistent with the above shall remain in effect.

IN WITNESS WHEREOF, the undersigned has executed this First Amendment to the Plan on this 17th day of October, 2023.

CHICO’S FAS, INC.

/s/ Kristin M. Gwinner

By: Kristin M. Gwinner

Title: Executive Vice President – Chief Human Resources Officer

Exhibit 10.3

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (this “Agreement”) is made and entered into this 26th day of July, 2023, by and between Wendy Hufford (the “Indemnified Party”) and CHICO’S FAS, INC., a Florida corporation (the “Corporation”). This Agreement is intended and shall be deemed to supersede and replace any prior indemnification agreement between the parties hereto.

WITNESSETH

WHEREAS, it is essential to the Corporation to retain and attract as Directors and/or Executive Officers the most capable persons available; and

WHEREAS, the substantial increase in corporate litigation subjects directors and officers to expensive litigation risks; and

WHEREAS, in addition, the statutory indemnification provisions of the Florida Business Corporation Act and Article VI of the Amended and Restated Bylaws of the Corporation (the “Article”) expressly provide that they are non-exclusive; and

WHEREAS, the Corporation considers it necessary and desirable to offer additional indemnification protection to its Directors and Executive Officers and desires the Indemnified Party to have such protection; and

WHEREAS, the Florida Business Corporation Act and the Article provide that indemnification of Directors and Executive Officers of the Corporation may be authorized by agreement, and thereby contemplates that contracts of this nature may be entered into between the Corporation and the Indemnified Party with respect to indemnification of the Indemnified Party as a Director and/or Executive Officer of the Corporation; and

WHEREAS, the parties hereto intend this Agreement to replace and supersede any existing indemnification agreement, if any, between them.

NOW THEREFORE, in exchange for, and in consideration of, the premises and the mutual covenants and agreements contained in this Agreement, including the Company’s agreement to continue the employment of Indemnified Party and to provide Indemnified Party with compensation for such employment, it is hereby agreed as follows:

1.INDEMNIFICATION GENERALLY.

(a) Grant of Indemnity. (i) Subject to and upon the terms and conditions of this Agreement, the Corporation shall indemnify and hold harmless the Indemnified Party in respect of any and all costs, claims, losses, damages and expenses (other than those specifically excluded herein) which may be incurred or suffered by the Indemnified Party as a result of or arising out of prosecuting, defending, settling or investigating:

(1) any threatened, pending, or completed claim, demand, inquiry, investigation, action , suit or proceeding, whether formal or informal or brought by or in the right of the Corporation or otherwise and whether of a civil, criminal, administrative or investigative nature, in which the Indemnified Party may be or may have been involved as a party or otherwise, arising out of the fact that the Indemnified Party is or was a director, officer, or employee of the Corporation or any of its “Affiliates” (as such term is defined in the rules and regulations promulgated by the Securities and Exchange Commission under the Securities Act of 1933), or served as a director, officer, employee or independent contractor of or for any person, firm, partnership, corporation or other entity at the request of the Corporation (including without limitation service in any capacity for or in connection with any employee benefit plan maintained by the Corporation or on behalf of the Corporation’s employees);

(2) any attempt (regardless of its success) by any person to charge or cause the Indemnified Party to be charged with wrongdoing or with financial responsibility for damages arising out of or incurred in connection with the matters indemnified against in this Agreement; or

(3) any expense, interest, assessment, fine, tax, judgment or settlement payment arising out of or incident to any of the matters indemnified against in this Agreement including reasonable fees and disbursements of legal counsel, experts, accountants, consultants and investigators (before and at trial and in appellate proceedings).

(ii) The obligation of the Corporation under this Agreement is not conditioned in any way on any attempt by the Indemnified Party to collect from an insurer any amount under a liability insurance policy.

(iii) Notwithstanding the foregoing or any other provision of this Agreement, in no case shall any indemnification be provided under this Agreement to the Indemnified Party by the Corporation in:

a.Any action or proceeding brought by or in the name or interest of the Indemnified Party against the Corporation;

a.Any action or proceeding brought by the Corporation against the Indemnified Party, which action is initiated at the direction of the Board of Directors of the Corporation; or

a.Any claim, circumstance, action or proceeding wherein the Corporation is entitled to (or the Indemnified Party is obligated for) repayment or forfeiture of any incentive-based compensation (in any form) under the Chico’s FAS Incentive Compensation Clawback Policy (or similar policy) then in effect, if any.

(b) Claims for Indemnification. (i) Whenever any claims shall arise for indemnification under this Agreement, the Indemnified Party shall notify the Corporation promptly and in any event within 30 days after the Indemnified Party has actual knowledge of the facts constituting the basis for such claim. The notice shall specify all facts known to the Indemnified Party giving rise to such indemnification right and the amount or an estimate of the amount of liability (including estimated expenses) arising therefrom.

(ii) Any indemnification under this Agreement shall be made no later than 30 days after receipt by the Corporation of the written notification specified in Section 1(b)(i), unless a determination is made that the Indemnified Party has not met the relevant standards for indemnification under this Agreement. Such determination shall be made within such 30 day period by (X) the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to the mater described in the notice or by (Y) independent legal counsel, agreed to by the Corporation, in a written opinion (which counsel shall be appointed if such a quorum is not obtainable).

(c) Rights to Defend or Settle; Third Party Claims, etc. (i) If the facts giving rise to any indemnification right under this Agreement shall involve any actual or threatened claim or demand against the Indemnified Party, or any possible claim by the Indemnified Party against any third party, such claim shall be referred to as a “Third Party Claim.” If the Corporation provides the Indemnified Party with a written agreement to indemnify, defend or prosecute and hold the Indemnified Party harmless from all costs and liability arising from the Third Party Claim (an “Agreement of Indemnity”), and demonstrates to the Indemnified Party the financial wherewithal to accomplish such indemnification, the Corporation may at its own expense undertake full responsibility for the defense or prosecution of such Third Party Claim. The Corporation may contest or settle any such Third Party Claim for money damages on such terms and conditions as it deems appropriate but shall be obligated to consult in good faith with the Indemnified Party and not to contest or settle any Third Party Claim involving injunctive or equitable relief against or affecting the Indemnified Party of his or her properties or assets without the prior written consent of the Indemnified Party, such consent not to be withheld unreasonably. The Indemnified Party may participate at his or her own expense and with his or her own counsel in defense or prosecution of a Third Party Claim pursuant to this Section 1(c)(i), and such participation shall not relieve the Corporation of its obligation to indemnify the Indemnified Party under this Agreement.

(ii) If the Corporation fails to deliver a satisfactory Agreement of Indemnity and evidence of financial wherewithal within 10 business days after receipt of notice pursuant to Section 1(b), the Indemnified Party may contest or settle the Third Party Claim on such terms as it sees fit but shall not reach a settlement with respect to the payment of money damages without consulting in good faith with the Corporation. The Corporation may participate at its own expense and with its own counsel in defense or prosecution of a Third Party Claim pursuant to this Section 1(c)(ii), but any such participation shall not relieve the Corporation of its obligations to indemnify the Indemnified Party under this Agreement. All expenses (including attorneys’ fees) incurred in defending or prosecuting any Third Party Claim shall be paid promptly by the Corporation as the suit or other matter is proceeding, upon the submission of bills therefore or other satisfactory evidence of such expenditures during the pendency of any matter as to which indemnification is available under this Agreement. The failure to make such payments within 10 days after submission of evidence of those expenses shall constitute a breach of a material obligation of the Corporation under this Agreement.

(iii) If by reason of any Third Party Claim a lien, attachment, garnishment or execution is placed upon any of the property or assets of the Indemnified Party, the Corporation shall promptly furnish a satisfactory indemnity bond to obtain the prompt release of such lien, attachment, garnishment or execution.

(iv) The Indemnified Party shall cooperate in the defense of any Third Party Claim which is controlled by the Corporation, but the Indemnified Party shall continue to be entitled to indemnification and reimbursement for all costs and expenses incurred by him or her in connection therewith as provided in this Agreement.

(d) Cooperation. The parties to this Agreement shall execute such powers of attorney as may be necessary or appropriate to permit participation of counsel selected by any party hereto and, as may be reasonably related to any such claim or action, shall provide to the counsel, accountants and other representatives of each party access during normal business hours to all properties, personnel, books, records, contracts, commitments and all other business records of such other party and will furnish to such other party copies of all such documents as may be reasonably requested (certified, if requested).

(e) Choice of Counsel. In all matters as to which indemnification is available to the Indemnified Party under this Agreement, the Indemnified Party shall be free to choose and retain counsel, subject to the prior written consent of the Corporation as to such selection, which consent shall not be unreasonably withheld.

(f) Consultation. If the Indemnified Party desires to retain the services of an attorney prior to the determination by the Corporation as to whether it will undertake the defense or prosecution of the Third Party Claim as provided in Section 1(c), the Indemnified Party shall notify the Corporation of such desire in the notice delivered pursuant to Section 1(b)(i), and such notice shall identify the counsel to be retained. The Corporation shall then have 10 days within which to advise the Indemnified Party whether it will assume the defense or prosecution of the Third Party Claim in accordance with Section 1(c)(i). If the Indemnified Party does not receive an affirmative response within such 10-day period, he shall be free to retain counsel of his or her choice, and the indemnity provided in Section 1(a) shall apply to the reasonable fees and disbursements of such counsel incurred after the expiration of such 10-day period. Any fees or disbursements incurred prior to the expiration of such 10-day period shall not be covered by the indemnity of Section 1(a).

(g) Repayment. (i) Notwithstanding the other provisions of this Agreement to the contrary, if the Corporation has incurred any cost, damage or expense under this Agreement paid to or for the benefit of the Indemnified Party and it is determined by a court of competent jurisdiction from which no appeal may be taken that the Indemnified Party’s actions or omissions constitute “Nonindemnifiable Conduct” as that term is defined in Section 1(g)(ii), the Indemnified Party shall and does hereby undertake in such circumstances to reimburse the Corporation for any and all such amounts previously paid to or for the benefit of the Indemnified Party.

(ii) For these purposes, “Nonindemnifiable Conduct” shall mean actions or omissions of the Indemnified Party material to the cause of action to which the indemnification under this Agreement related is determined to involve:

(1) a violation of the criminal law, unless the Indemnified Party had reasonable cause to believe his conduct was lawful and had no reasonable cause to believe his conduct was unlawful;

(2) a transaction in which the Indemnified Party derived an improper personal benefit;

(3) if the Indemnified Party is a director of the Corporation, a circumstance under which the liability provisions of Section 607.0834 (or any successor or similar statute) are applicable;

(4) willful misconduct or a conscious disregard for the best interests of the Corporation (when indemnification is sought in a proceeding by or in the right of the Corporation to procure a judgment in favor of the Corporation or when indemnification is sought in a proceeding by or in the right of a stockholder); or

(5) conduct, that pursuant to then applicable law, may not be indemnified.

1.TERM.

This Agreement shall be effective upon its execution by all parties and shall continue in full force and effect, unless amended, superseded or terminated by agreement of the parties hereto, until the date seven years after the date of this Agreement, or seven years after the termination of the Indemnified Party’s employment or term of office, whichever is later, provided that such term shall be extended by any period of time during which the Corporation is in breach of a material obligation to the Indemnified Party, plus ninety days. Such term shall also be extended with respect to each Third Party Claim then pending and as to which notice under Section 1(b) has theretofore been given by the Indemnified Party to the Corporation, and this Agreement shall continue to be applicable to each such Third Party Claim.

1.REPRESENTATIONS AND AGREEMENTS OF THE CORPORATION.

(a) Authority. The Corporation represents, covenants and agrees that it has the corporate power and authority to enter into this Agreement and to carry out its obligations under this Agreement. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated by this Agreement have been duly authorized by the Board of Directors of the Corporation. This Agreement is a valid and binding obligation of the Corporation and is enforceable against the Corporation in accordance with its terms.

(b) Noncontestability. The Corporation represents, covenants and agrees that it will not initiate, and that it will use its best efforts to cause any of its Affiliates not to initiate, any action, suit or proceeding challenging the validity or enforceability of this Agreement.

(c) Good Faith Judgment. The Corporation represents, covenants and agrees that it will exercise good faith judgment in determining the entitlement of the Indemnified Party to indemnification under this Agreement.

1.RELATIONSHIP OF THIS AGREEMENT TO OTHER INDEMNITIES.

(a) Nonexclusivity. (i) This Agreement and all rights granted to the Indemnified Party under this Agreement are in addition to and are not deemed to be exclusive

with or of any other rights that may be available to the Indemnified Party under any Articles of Incorporation, bylaw, statute, agreement, or otherwise.

(ii) The rights, duties and obligations of the Corporation and the Indemnified Party under this Agreement do not limit, diminish or supersede the rights, duties and obligations of the Corporation and the Indemnified Party with respect to the indemnification afforded to the Indemnified Party under any liability insurance, the Florida Business Corporation Act, or under the bylaws or the Articles of Incorporation of the Corporation. In addition, the Indemnified Party’s rights under this Agreement will not be limited or diminished in any respect by any amendment to the bylaws or the Articles of Incorporation of the Corporation.

(b) Availability, Contribution, etc. (i) The availability or nonavailability of indemnification by way of insurance policy, Articles of Incorporation, bylaw, vote of stockholders, or otherwise from the Corporation to the Indemnified Party shall not affect the right of the Indemnified Party to indemnification under this Agreement, provided that all rights under this Agreement shall be subject to applicable statutory provisions in effect from time to time.

(ii) Any funds received by the Indemnified Party by way of indemnification or payment from any source other than from the Corporation under this Agreement shall reduce any amount otherwise payable to the Indemnified Party under this Agreement.

(iii) If the Indemnified Party is entitled under any provision of this Agreement to indemnification by the Corporation for some claims, issues or matters, but not other claims, issues or matters, or for some or a portion of the expenses, judgments, fines or penalties actually and reasonably incurred by the Indemnified Party or amounts actually and reasonably paid in settlement by him or her in the investigation, defense, appeal or settlement of any matter for which indemnification is sought under this Agreement, but not for the total amount thereof, the Corporation shall nevertheless indemnify the Indemnified Party for the portion of such claims, issues or matters or expenses, judgments, fines, penalties or amounts paid in settlement to which the Indemnified Party is entitled.

(iv) If for any reason a court of competent jurisdiction from which no appeal has been taken rules than the indemnity provided under this Agreement is unavailable, or if for any reason the indemnity under this Agreement is insufficient to hold the Indemnified Party harmless as provided in this Agreement, then in either event, the Corporation shall contribute to the amounts paid or payable by the Indemnified Party in such proportion as equitably reflects the relative benefits received by, and fault of the Indemnified Party and the Corporation and its Affiliates.

(c) Allowance for Compliance with SEC Requirements. The Indemnified Party acknowledges that the Securities and Exchange Commission (“SEC”) has expressed the opinion that indemnification of directors and officers from liabilities under the Securities Act of 1933 (the “1933 Act”) is against public policy as expressed in the 1933 Act and, is therefore, unenforceable. The Indemnified Party hereby agrees that it will not be a breach of this Agreement for the Corporation to undertake with the SEC in connection with the registration for sale of any stock or other securities of the Corporation from time to time that, in

the event a claim for indemnification against such liabilities (other than the payment by the Corporation of expenses incurred or paid by a director of officer of the Corporation in the successful defense of any action, suit or proceeding) is asserted in connection with such stock or other securities being registered, the Corporation will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of competent jurisdiction on the question of whether or not such indemnification by it is against public policy as expressed in the 1933 Act and will be governed by the final adjudication of such issue. The Indemnified Party further agrees that such submission to a court of competent jurisdiction shall not be a breach of this Agreement.

1.MISCELLANEOUS.

(a) Notices. All notices, requests, demands and other communications which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given when received if personally delivered; when transmitted if transmitted by telecopy, electronic telephone line facsimile transmission or other similar electronic or digital transmission method; the day after it is sent, if sent by recognized expedited delivery service; and five days after it is sent, if mailed, first class mail, postage prepaid. In each case notice shall be sent to:

If to the Indemnified Party:

Wendy Hufford

XXXX

If to the Corporation:

Chico’s FAS, Inc.

11215 Metro Parkway

Fort Myers, FL 33966

Attn: SVP-General Counsel

or to such other address as either party may have specified in writing to the other using the procedures specified above in this Section 5(a).

(b) Construction and Interpretation. (i) This Agreement shall be construed pursuant to and governed by the substantive laws of the State of Florida (and any provision of Florida law shall not apply if the law of a state or jurisdiction other than Florida would otherwise apply).

(ii) The headings of the various sections in this Agreement are inserted for the convenience of the parties and shall not affect the meaning, construction or interpretation of this Agreement.

(iii) Any provision of this Agreement which is determined by a court of competent jurisdiction to be prohibited, unenforceable or not authorized in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition, unenforceability or non-authorization without invalidating the remaining provisions hereof or affecting the validity, enforceability or legality of such provision in any other jurisdiction. In any such case, such

determination shall not affect any other provision of this Agreement, and the remaining provisions of this Agreement shall remain in full force and effect. If any provision or term of this Agreement is susceptible to two or more constructions or interpretations, one or more of which would render the provision or term void or unenforceable, the parties agree that a construction or interpretation which renders the term or provision valid shall be favorable.

(iv) As used in this Agreement, (1) the word “including” is always without limitation; (2) the words in the singular number include words of the plural number and vice versa; and (3) the word “person” includes a trust, corporation, association, partnership, joint venture, business trust, unincorporated organization, limited liability company, government, public body or authority and any governmental agency or department as well as a natural person.

(c) Entire Agreement. This Agreement, including the introductory recitals on page 1 hereof, constitutes the entire Agreement, and supersedes all prior agreements and understandings, oral and written, among the parties to this Agreement with respect to the subject matter hereof.

(d) Specific Enforcement. (i) The parties agree and acknowledge that in the event of a breach by the Corporation of its obligation promptly to indemnify the Indemnified Party as provided in this Agreement, or breach of any other material provision of this Agreement, damages at law will be an insufficient remedy to the Indemnified Party. Accordingly, the parties agree that, in addition to any other remedies or rights that may be available to the Indemnified Party, the Indemnified Party shall also be entitled, upon application to a court of competent jurisdiction, to obtain temporary or permanent injunctions to compel specific performance of the obligations of the Corporation under this Agreement.

(ii) There shall exist in such action a rebuttable presumption that the Indemnified Party has met the applicable standard(s) of conduct and is therefore entitled to indemnification pursuant to this Agreement, and the burden of proving that the relevant standards have not been met by the Indemnified Party shall be on the Corporation. Neither the failure of the Corporation (including its Board of Directors or independent legal counsel) prior to the commencement of such action to have made a determination that indemnification is proper in the circumstances because the Indemnified Party has met the applicable standard of conduct, nor an actual determination by the Corporation (including its Board of Directors or independent legal counsel) that the Indemnified Party has not met such applicable standard of conduct, shall (X) constitute a defense to the action, (Y) create a presumption that the Indemnified Party has not met the applicable standard of conduct, or (Z) otherwise alter the presumption in favor of the Indemnified Party referred to in the preceding sentence.

(e) Cost of Enforcement; Interest. (i) If the Indemnified party engages the services of an attorney or any other third party or in any way initiates legal action to enforce his rights under this Agreement, including but not limited to the collection of monies due from the Corporation to the Indemnified Party, the prevailing party shall be entitled to recover all reasonable costs and expenses (including reasonable attorneys’ fees before and at trial and in appellate proceedings). Should the Indemnified Party prevail, such costs and expenses shall be in addition to monies otherwise due him under this Agreement.

(ii) If any monies shall be due the Indemnified Party from the Corporation under this Agreement and shall not be paid within 30 days from the date of written request for payment, interest shall accrue on such unpaid amount at the rate of 2% per annum in excess of the U. S. Prime rate, or such lower rate as may be required to comply with applicable law from the date when due until it is paid in full.

(f) Application to Third Parties, Etc. Nothing in this Agreement, whether express or implied, is intended or should be construed to confer upon, or to grant to, any person, except the Corporation, the Indemnified Party and their respective heirs, assignees and successors, any claim, right or remedy under or because of this Agreement or in any provision of it. This Agreement shall be binding upon and inure to the benefit of the successors in interest and assigns, heirs and personal representatives, as the case may be, of the parties, including any successor corporation resulting from a merger, consolidation, recapitalization, reorganization, sale of all or substantially all of the assets of the Corporation, or any other transaction resulting in the successor corporation assuming the liabilities of the Corporation under this Agreement (by operation of law, or otherwise).

(g) Further Assurances. The parties to this Agreement will execute and deliver, or cause to be executed and delivered, such additional or further documents, agreements or instruments and shall cooperate with one another in all respects for the purpose of carrying out the transactions contemplated by this Agreement.

(h) Venue; Process. The parties to this Agreement agree that jurisdiction and venue in any action brought pursuant to this Agreement to enforce its terms or otherwise with respect to the relationships between the parties shall properly lie in the Circuit Court of the Twentieth Judicial Circuit of the State of Florida in and for Lee County or in the United States District Court for the Middle District of Florida, Fort Myers Division. Such jurisdiction and venue are merely permissive; jurisdiction and venue shall also continue to lie in any court where jurisdiction and venue would otherwise be proper. The parties agree that they will not object that any action commenced in the foregoing jurisdictions is commenced in a forum non conveniens. The parties further agree that the mailing by certified or registered mail, return receipt requested, of any process required by any such court shall constitute valid and lawful service of process against them, without the necessity for service by any other means provided by statute or rule of court.

(i) Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be considered an original, but all of which together shall constitute one and the same instrument.

(j) Waiver and Delay. No waiver or delay in enforcing the terms of this Agreement shall be construed as a waiver of any subsequent breach. No action taken by the Indemnified Party shall constitute a waiver of his rights under this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement on the date first above written.

CHICO’S FAS, INC.

By: /s/ Molly Langenstein

Molly Langenstein

Chief Executive Officer & President

By: /s/ Wendy Hufford

Wendy Hufford

SVP, General Counsel, Corporate Secretary &

Chief Compliance Officer

Exhibit 31.1

CHICO’S FAS, INC. AND SUBSIDIARIES CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, Molly Langenstein, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Chico’s FAS, Inc. for the period ended October 28, 2023;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 30, 2023


/s/ Molly Langenstein
Name:						Molly Langenstein
Title:						Chief Executive Officer, President and Director

Exhibit 31.2

CHICO’S FAS, INC. AND SUBSIDIARIES CERTIFICATION PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

CERTIFICATION

I, David M. Oliver, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Chico’s FAS, Inc. for the period ended October 28, 2023;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 30, 2023


/s/ David M. Oliver
Name:						David M. Oliver
Title:						Executive Vice President – Chief Financial Officer and Chief Accounting Officer

Exhibit 32.1

Certification Pursuant To 18 U.S.C. Section 1350,

As Adopted Pursuant To

Section 906 Of The Sarbanes-Oxley Act Of 2002

I, Molly Langenstein, Chief Executive Officer, President and Director of Chico’s FAS, Inc. (the “Company”) certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1)The Quarterly Report of the Company on Form 10-Q for the period ended October 28, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Molly Langenstein
Molly Langenstein
Chief Executive Officer, President and Director

Date: November 30, 2023

Exhibit 32.2

Certification Pursuant To 18 U.S.C. Section 1350,

As Adopted Pursuant To

Section 906 Of The Sarbanes-Oxley Act Of 2002

I, David M. Oliver, Executive Vice President - Chief Financial Officer and Chief Accounting Officer of Chico’s FAS, Inc. (the “Company”) certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ David M. Oliver
David M. Oliver
Executive Vice President – Chief Financial Officer and Chief Accounting Officer

Date: November 30, 2023

Cover Page - shares	9 Months Ended
Cover Page - shares	Oct. 28, 2023	Nov. 21, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Oct. 28, 2023
Document Transition Report	false
Entity File Number	001-16435
Entity Registrant Name	Chico’s FAS, Inc.
Entity Incorporation, State or Country Code	FL
Entity Tax Identification Number	59-2389435
Entity Address, Address Line One	11215 Metro Parkway
Entity Address, City or Town	Fort Myers
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33966
City Area Code	239
Local Phone Number	277-6200
Title of 12(b) Security	Common Stock, Par Value $0.01 Per Share
Trading Symbol	CHS
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		123,457,364
Amendment Flag	false
Entity Central Index Key	0000897429
Current Fiscal Year End Date	--02-03
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3

CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Income Statement [Abstract]
Net Sales	$ 505,126	$ 518,332	$ 1,584,995	$ 1,617,967
Net sales, as a percentage	100.00%	100.00%	100.00%	100.00%
Cost of goods sold	$ 308,677	$ 310,892	$ 946,637	$ 962,448
Cost of goods sold, as a percentage of sales	61.10%	60.00%	59.70%	59.50%
Gross Profit	$ 196,449	$ 207,440	$ 638,358	$ 655,519
Gross profit, as a percentage of sales	38.90%	40.00%	40.30%	40.50%
Selling, general, and administrative expenses	$ 178,643	$ 175,841	$ 520,672	$ 520,296
Selling, general, and administrative expenses, as a percentage of sales	35.40%	33.90%	32.80%	32.10%
Merger-related costs	$ 7,277	$ 0	$ 7,277	$ 0
Merger-related costs, as a percentage of sales	1.40%	0.00%	0.50%	0.00%
Income from Operations	$ 10,529	$ 31,599	$ 110,409	$ 135,223
Income from operations, as a percentage of sales	2.10%	6.10%	7.00%	8.40%
Interest expense, net	$ (389)	$ (1,080)	$ (1,439)	$ (3,111)
Interest expense, net, as a percentage of sales	(0.10%)	(0.20%)	(0.10%)	(0.20%)
Income before Income Taxes	$ 10,140	$ 30,519	$ 108,970	$ 132,112
Income before income taxes, as a percentage of sales	2.00%	5.90%	6.90%	8.20%
Income tax provision	$ 5,100	$ 5,900	$ 4,700	$ 30,600
Income tax provision, as a percentage of sales	1.00%	1.20%	0.30%	1.90%
Net Income	$ 5,040	$ 24,619	$ 104,270	$ 101,512
Net income, as a percentage of sales	1.00%	4.70%	6.60%	6.30%
Per Share Data:
Net income per common share – basic (in dollars per share)	$ 0.04	$ 0.20	$ 0.87	$ 0.84
Net income per common and common equivalent share – diluted (in dollars per share)	$ 0.04	$ 0.20	$ 0.85	$ 0.82
Weighted average common shares outstanding – basic (in shares)	119,457	120,333	119,424	119,776
Weighted average common and common equivalent shares outstanding – diluted (in shares)	122,735	124,887	122,500	124,016

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Statement of Comprehensive Income [Abstract]
Net income	$ 5,040	$ 24,619	$ 104,270	$ 101,512
Other comprehensive income:
Unrealized gains (losses) on marketable securities, net of taxes	35	(233)	72	(228)
Comprehensive income	$ 5,075	$ 24,386	$ 104,342	$ 101,284

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Oct. 28, 2023	Jan. 28, 2023	Oct. 29, 2022
Current Assets:
Cash and cash equivalents	$ 101,944	$ 153,377	$ 117,726
Marketable securities, at fair value	24,702	24,677	23,017
Inventories	342,721	276,840	304,127
Prepaid expenses and other current assets	51,086	48,604	47,208
Income tax receivable	9,181	11,865	15,430
Total Current Assets	529,634	515,363	507,508
Property and Equipment, net	200,980	192,165	183,153
Right of Use Assets	466,888	435,321	432,018
Other Assets:
Goodwill	16,360	16,360	16,360
Other intangible assets, net	5,000	5,000	5,000
Other assets, net	45,853	23,632	18,890
Total Other Assets	67,213	44,992	40,250
Total assets	1,264,715	1,187,841	1,162,929
Current Liabilities:
Accounts payable	153,401	156,262	107,400
Current lease liabilities	150,053	153,202	157,687
Other current and deferred liabilities	138,887	141,698	155,133
Total Current Liabilities	442,341	451,162	420,220
Noncurrent Liabilities:
Long-term debt	24,000	49,000	69,000
Long-term lease liabilities	373,823	349,409	346,560
Other noncurrent and deferred liabilities	1,956	2,637	2,612
Total Noncurrent Liabilities	399,779	401,046	418,172
Commitments and Contingencies (see Note 12)
Shareholders’ Equity:
Preferred stock, $0.01 par value; 2,500 shares authorized; no shares issued and outstanding	0	0	0
Common stock, $0.01 par value; 400,000 shares authorized; 167,994 and 166,320 and 166,326 shares issued respectively; and 123,447 and 125,023 and 125,029 shares outstanding, respectively	1,234	1,250	1,250
Additional paid-in capital	516,323	513,914	510,374
Treasury stock, at cost, 44,547 and 41,297 and 41,297 shares, respectively	(514,168)	(494,395)	(494,395)
Retained earnings	419,292	315,022	307,536
Accumulated other comprehensive loss	(86)	(158)	(228)
Total Shareholders’ Equity	422,595	335,633	324,537
Total liabilities and shareholders' equity	$ 1,264,715	$ 1,187,841	$ 1,162,929

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Oct. 28, 2023	Jan. 28, 2023	Oct. 29, 2022
Statement of Financial Position [Abstract]
Preferred share par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Preferred shares authorized (in shares)	2,500,000	2,500,000	2,500,000
Preferred shares issued (in shares)	0	0	0
Preferred shares outstanding (in shares)	0	0	0
Common share par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Common shares authorized (in shares)	400,000,000	400,000,000	400,000,000
Common shares issued (in shares)	167,994,000	166,320,000	166,326,000
Common shares outstanding (in shares)	123,447,000	125,023,000	125,029,000
Treasury shares at cost (in shares)	44,547,000	41,297,000	41,297,000

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Treasury Stock	Retained Earnings	Accumulated Other Comprehensive Gain (Loss)
Beginning balance (in shares) at Jan. 29, 2022		122,526
Beginning balance at Jan. 29, 2022	$ 221,504	$ 1,225	$ 508,654	$ (494,395)	$ 206,020	$ 0
Treasury stock, beginning balance (in shares) at Jan. 29, 2022				41,297
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	101,512				101,512
Unrealized gains (losses) on marketable securities, net of taxes	(228)					(228)
Issuance of common stock (in shares)		4,258
Issuance of common stock	239	$ 43	196
Dividends on common stock	4				4
Repurchase of common stock and tax withholdings related to share-based awards (in shares)		(1,755)
Repurchase of common stock and tax withholdings related to share-based awards	(8,815)	$ (18)	(8,797)
Share-based compensation	$ 10,321		10,321
Ending balance (in shares) at Oct. 29, 2022	125,029	125,029
Ending balance at Oct. 29, 2022	$ 324,537	$ 1,250	510,374	$ (494,395)	307,536	(228)
Treasury stock, ending balance (in shares) at Oct. 29, 2022	41,297			41,297
Beginning balance (in shares) at Jul. 30, 2022		125,184
Beginning balance at Jul. 30, 2022	$ 297,877	$ 1,252	508,105	$ (494,395)	282,910	5
Treasury stock, beginning balance (in shares) at Jul. 30, 2022				41,297
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	24,619				24,619
Unrealized gains (losses) on marketable securities, net of taxes	(233)					(233)
Issuance of common stock (in shares)		3
Issuance of common stock	83		83
Dividends on common stock	7				7
Repurchase of common stock and tax withholdings related to share-based awards (in shares)		(158)
Repurchase of common stock and tax withholdings related to share-based awards	(980)	$ (2)	(978)
Share-based compensation	$ 3,164		3,164
Ending balance (in shares) at Oct. 29, 2022	125,029	125,029
Ending balance at Oct. 29, 2022	$ 324,537	$ 1,250	510,374	$ (494,395)	307,536	(228)
Treasury stock, ending balance (in shares) at Oct. 29, 2022	41,297			41,297
Beginning balance (in shares) at Jan. 28, 2023	125,023	125,023
Beginning balance at Jan. 28, 2023	$ 335,633	$ 1,250	513,914	$ (494,395)	315,022	(158)
Treasury stock, beginning balance (in shares) at Jan. 28, 2023	41,297			41,297
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	$ 104,270				104,270
Unrealized gains (losses) on marketable securities, net of taxes	72					72
Issuance of common stock (in shares)		2,830
Issuance of common stock	329	$ 28	301
Repurchase of common stock and tax withholdings related to share-based awards (in shares)		(4,406)		(3,250)
Repurchase of common stock and tax withholdings related to share-based awards	(26,845)	$ (44)	(7,028)	$ (19,773)
Share-based compensation	$ 9,136		9,136
Ending balance (in shares) at Oct. 28, 2023	123,447	123,447
Ending balance at Oct. 28, 2023	$ 422,595	$ 1,234	516,323	$ (514,168)	419,292	(86)
Treasury stock, ending balance (in shares) at Oct. 28, 2023	44,547			44,547
Beginning balance (in shares) at Jul. 29, 2023		123,524
Beginning balance at Jul. 29, 2023	$ 415,257	$ 1,235	514,059	$ (514,168)	414,252	(121)
Treasury stock, beginning balance (in shares) at Jul. 29, 2023				44,547
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	5,040				5,040
Unrealized gains (losses) on marketable securities, net of taxes	35					35
Issuance of common stock (in shares)		44
Issuance of common stock	111		111
Repurchase of common stock and tax withholdings related to share-based awards (in shares)		(121)
Repurchase of common stock and tax withholdings related to share-based awards	(678)	$ (1)	(677)
Share-based compensation	$ 2,830		2,830
Ending balance (in shares) at Oct. 28, 2023	123,447	123,447
Ending balance at Oct. 28, 2023	$ 422,595	$ 1,234	$ 516,323	$ (514,168)	$ 419,292	$ (86)
Treasury stock, ending balance (in shares) at Oct. 28, 2023	44,547			44,547

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022
Cash Flows from Operating Activities:
Net income	$ 104,270	$ 101,512
Adjustments to reconcile net income to net cash provided by operating activities:
Inventory write-offs	0	826
Depreciation and amortization	31,283	33,350
Non-cash lease expense	135,679	137,184
Loss on disposal and impairment of property and equipment, net	83	1,804
Deferred tax benefit	(15,825)	(381)
Share-based compensation expense	9,136	10,321
Changes in assets and liabilities:
Inventories	(65,881)	18,436
Prepaid expenses and other assets	(10,480)	(2,591)
Income tax receivable	2,684	(1,732)
Accounts payable	(2,778)	(73,120)
Accrued and other liabilities	(6,924)	13,583
Lease liability	(145,729)	(155,561)
Net cash provided by operating activities	35,518	83,631
Cash Flows from Investing Activities:
Purchases of marketable securities	(13,913)	(26,376)
Proceeds from sale of marketable securities	13,938	3,083
Purchases of property and equipment	(35,460)	(21,207)
Proceeds from sale of assets	0	2,772
Net cash used in investing activities	(35,435)	(41,728)
Cash Flows from Financing Activities:
Payments on borrowings	(25,000)	(30,000)
Payments of debt issuance costs	0	(706)
Proceeds from issuance of common stock	329	239
Repurchase of treasury stock under repurchase program	(19,805)	0
Payments of tax withholdings related to share-based awards	(7,040)	(8,815)
Net cash used in financing activities	(51,516)	(39,282)
Net (decrease) increase in cash and cash equivalents	(51,433)	2,621
Cash and Cash Equivalents, Beginning of period	153,377	115,105
Cash and Cash Equivalents, End of period	101,944	117,726
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest	2,409	3,686
Cash paid for income taxes, net	$ (14,230)	$ (26,426)

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Oct. 28, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying unaudited condensed consolidated financial statements of Chico’s FAS, Inc., a Florida corporation, and its wholly owned subsidiaries (“Company”) have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and notes required by accounting principles generally accepted in the U.S. for complete financial statements. In the opinion of management, such interim financial statements reflect all normal, recurring adjustments considered necessary to present fairly the condensed consolidated financial position, the results of operations, and cash flows for the interim periods presented. All significant intercompany balances and transactions have been eliminated in consolidation. The fiscal year ended January 28, 2023 balance sheet data was derived from audited consolidated financial statements. For further information, refer to the consolidated financial statements and notes thereto for the fiscal year ended January 28, 2023, included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 28, 2023, filed with the Securities and Exchange Commission (“SEC”) on March 14, 2023 (“2022 Annual Report on Form 10-K”). As used in this report, all references to “we,” “us,” “our,” “Company,” and “Chico’s FAS,” refer to Chico’s FAS, Inc. and all of its wholly owned subsidiaries. Our fiscal years end on the Saturday closest to January 31 and are designated by the calendar year in which the fiscal year commences. Operating results for the thirteen and thirty-nine weeks ended October 28, 2023 are not necessarily indicative of the results that may be expected for the entire year. Adoption of New Accounting Pronouncements In September 2022, the Financial Accounting Standards Board, or FASB, issued Accounting Standards Update (“ASU”) 2022-04, entitled “Supplier Finance Programs: Disclosure of Supplier Finance Program Obligations,” to improve the disclosures of supplier finance programs. Specifically, the ASU requires disclosure of key terms of the supplier finance programs and a roll-forward of the related obligations. The amendments in this ASU do not affect the recognition, measurement, or financial statement presentation of obligations covered by supplier finance programs. The ASU is effective for the fiscal years, and the interim periods within those years, beginning after December 15, 2022, except for the amendment on roll-forward information, which is effective for fiscal years beginning after December 15, 2023. Early adoption is permitted. The Company entered into a supplier financing agreement administered by a third-party platform in the fourth quarter of 2022. Payments to suppliers through this program began in the third quarter of fiscal 2023. Refer to Note 11 for additional information regarding the Company’s payment obligations to participating suppliers. Entry into Merger Agreement On September 27, 2023, the Company entered into an Agreement and Plan of Merger (“Merger Agreement”) with Daphne Parent LLC, a Delaware limited liability company (“Parent”), and Daphne Merger Sub, Inc., a Florida corporation and wholly owned subsidiary of Parent (“Merger Sub” and together with Parent, “Buyer Parties”), providing for the merger of Merger Sub with and into the Company, with the Company continuing as the surviving corporation and becoming a wholly owned subsidiary of Parent (“Merger”). Upon the consummation of the Merger, each share of the Company’s common stock outstanding as of immediately prior to the effective time of the Merger (other than shares of the Company’s common stock that are (i) held by the Company or any subsidiary of the Company, (ii) owned by the Buyer Parties, or (iii) owned by any direct or indirect wholly owned subsidiary of the Buyer Parties as of immediately prior to the effective time (“Owned Company Shares”)) will be cancelled and extinguished and automatically converted into the right to receive cash in an amount equal to $7.60 per share, without interest thereon. Each Owned Company Share will be cancelled and extinguished without any conversion thereof or consideration paid therefor. Consummation of the Merger is subject to certain conditions set forth in the Merger Agreement, including, but not limited to, the following: (i) the affirmative vote of the holders of a majority of all of the outstanding shares of the Company’s common stock to adopt the Merger Agreement; (ii) the absence of any law or order restraining, enjoining, or otherwise prohibiting the Merger; and (iii) the absence of a Company Material Adverse Effect (as defined in the Merger Agreement, which is filed as Exhibit 2.1 to this Quarterly Report on Form 10-Q). The Go-Shop Period has ended, and the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, has expired. In addition, the Company filed its Definitive Merger Proxy Statement on Schedule 14A with the Securities and Exchange Commission on November 29, 2023. The transaction is not subject to a financing condition. The Merger Agreement includes customary representations, warranties, and covenants of the parties, including termination provisions for both the Company and the Buyer Parties. Under the Merger Agreement, the Company may be required to pay the Buyer Parties a termination fee of up to $29,956,324 if the Merger Agreement is terminated under certain specified circumstances. The Merger Agreement also places certain restrictions on the conduct of the Company’s business prior to the completion of the Merger, which could delay or prevent the Company from undertaking business opportunities that may arise or any other action it would otherwise take with respect to the operations of the Company absent these restrictions. Parent and the Company expect to close the Merger by the end of the first calendar quarter of 2024.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS	9 Months Ended
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS	Oct. 28, 2023
Accounting Changes and Error Corrections [Abstract]
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS	RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Company currently has no material recent accounting pronouncements yet to be adopted.

REVENUE RECOGNITION

9 Months Ended

Oct. 28, 2023

Revenue from Contract with Customer [Abstract]

REVENUE RECOGNITION

Disaggregated Revenue



	Thirteen Weeks Ended								Thirty-Nine Weeks Ended
	October 28, 2023				October 29, 2022				October 28, 2023				October 29, 2022
Chico’s	$	252,221	49.9	%	$	255,341	49.3	%	$	800,088	50.5	%	$	801,584	49.5	%
WHBM	147,498		29.2		157,451		30.4		451,016		28.4		485,061		30.0
Soma	105,407		20.9		105,540		20.3		333,891		21.1		331,322		20.5

Total Net Sales	$	505,126	100.0	%	$	518,332	100.0	%	$	1,584,995	100.0	%	$	1,617,967	100.0	%

Contract Liability


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022


Beginning gift card liability	$	30,905	$	33,707	$	42,649	$	43,536
Issuances	7,602		7,878		26,585		28,218
Redemptions	(9,174)		(9,869)		(35,893)		(37,739)
Breakage adjustment	(162)		176		(4,170)		(2,123)
Ending gift card liability	$	29,171	$	31,892	$	29,171	$	31,892


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022


Beginning balance rewards deferred revenue	$	9,233	$	3,236	$	7,441	$	626
Net reduction in revenue	653		1,288		2,445		3,898
Ending balance rewards deferred revenue	$	9,886	$	4,524	$	9,886	$	4,524

Performance Obligation

LEASES

9 Months Ended

Oct. 28, 2023

Leases [Abstract]

LEASES

Operating lease expense was as follows:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022
Operating lease cost (1)	$	58,132	$	55,608	$	169,916	$	163,271

Supplemental balance sheet information related to operating leases was as follows:


	October 28, 2023			January 28, 2023			October 29, 2022
Right of use assets	$	466,888		$	435,321		$	432,018

Current lease liabilities	$	150,053		$	153,202		$	157,687
Long-term lease liabilities	373,823			349,409			346,560
Total operating lease liabilities	$	523,876		$	502,611		$	504,247

Weighted Average Remaining Lease Term (years)	4.4			4.2			4.1

Weighted Average Discount Rate (1)	5.9		%	5.3		%	5.0		%

Supplemental cash flow information related to operating leases was as follows:


	Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows	$	145,729	$	155,561
Right of use assets obtained in exchange for lease obligations, non-cash	145,342		88,484

Maturities of operating lease liabilities as of October 28, 2023 were as follows:


Fiscal Year Ending:
February 3, 2024	$	48,986
February 1, 2025	171,076
January 31, 2026	129,459
January 30, 2027	95,434
January 29, 2028	66,278
Thereafter	92,906
Total future minimum lease payments	$	604,139
Less imputed interest	(80,263)
Total	$	523,876

SHARE-BASED COMPENSATION

9 Months Ended

Oct. 28, 2023

Share-Based Payment Arrangement [Abstract]

SHARE-BASED COMPENSATION

Restricted Stock Awards

Restricted stock award activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	4,611,801	$	4.02
Granted	2,146,506	5.85
Vested	(2,399,562)	3.77
Forfeited	(418,664)	5.02
Unvested, end of period	3,940,081	5.06

Restricted Stock Units

Restricted stock unit activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	406,218	$	2.46
Granted	27,462	5.28
Vested	(274,573)	2.17

Unvested, end of period	159,107	3.46

Performance-based Restricted Stock Units

PSU activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Units/ Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	2,696,449	$	3.48
Granted	1,239,354	5.70
Vested	(753,078)	3.17
Forfeited	(193,703)	5.45
Unvested, end of period	2,989,022	4.35

INCOME TAXES	9 Months Ended
INCOME TAXES	Oct. 28, 2023
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES The provision for income taxes is based on a current estimate of the annual effective tax rate and is adjusted as necessary for quarterly events. Our effective income tax rate may fluctuate from quarter to quarter as a result of a variety of factors, including changes in our assessment of certain tax contingencies, valuation allowances, changes in tax law, outcomes of administrative audits, the impact of discrete items, and the mix of earnings across jurisdictions. For the thirteen weeks ended October 28, 2023 and October 29, 2022, the Company’s effective tax rate was 50.3% and 19.3%, respectively. The effective tax rate of 50.3% for the thirteen weeks ended October 28, 2023 primarily reflects the impact of certain incurred and anticipated nondeductible Merger-related costs, and the Company’s projected annual pre-tax income, partially offset by a fiscal 2022 provision-to-return benefit related to federal tax credits. The 19.3% effective tax rate for the thirteen weeks ended October 29, 2022 primarily reflects the impact of a fiscal 2021 provision-to-return benefit due to the reversal of a valuation allowance related to temporary differences. For the thirty-nine weeks ended October 28, 2023 and October 29, 2022, the Company’s effective tax rate was 4.3% and 23.2%, respectively. The effective tax rate of 4.3% for the thirty-nine weeks ended October 28, 2023 primarily reflects the non-cash benefit for the partial reversal of the valuation allowance on deferred tax assets, favorable share-based compensation benefit, and a fiscal 2022 provision-to-return benefit related to federal credits, offset by the impact of certain incurred and anticipated nondeductible Merger-related costs and the Company’s projected annual pre-tax income. The 23.2% effective tax rate for the thirty-nine weeks ended October 29, 2022 primarily reflects a provision to return benefit due to the reversal of a valuation allowance related to 2021 temporary differences and favorable share-based compensation benefit. As of October 28, 2023, our unaudited condensed consolidated balance sheet reflected a $7.9 million income tax receivable related to the recovery of federal income taxes paid in prior years and other tax law changes as a result of the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act.

INCOME PER SHARE

9 Months Ended

Oct. 28, 2023

Earnings Per Share [Abstract]

INCOME PER SHARE

The following table sets forth the computation of net income per basic and diluted share shown on the face of the accompanying condensed consolidated statements of income:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022

Numerator:
Net income	$	5,040	$	24,619	$	104,270	$	101,512
Net income allocated to participating securities	(2)		(47)		(113)		(370)
Net income available to common shareholders	$	5,038	$	24,572	$	104,157	$	101,142
Denominator:
Weighted average common shares outstanding – basic	119,457		120,333		119,424		119,776
Dilutive effect of non-participating securities	3,278		4,554		3,076		4,239
Weighted average common and common equivalent shares outstanding – diluted	122,735		124,887		122,500		124,016
Net income per common share:
Basic	$	0.04	$	0.20	$	0.87	$	0.84
Diluted	$	0.04	$	0.20	$	0.85	$	0.82

FAIR VALUE MEASUREMENTS

9 Months Ended

Oct. 28, 2023

Fair Value Disclosures [Abstract]

FAIR VALUE MEASUREMENTS

The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels are defined as follows:


Level 1	—	Unadjusted quoted prices in active markets for identical assets or liabilities

Level 2	—	Unadjusted quoted prices in active markets for similar assets or liabilities; or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs other than quoted prices that are observable for the asset or liability

Level 3	—	Unobservable inputs for the asset or liability

Assets Measured on a Recurring Basis

Assets Measured on a Nonrecurring Basis

We conduct reviews on a quarterly basis to verify pricing, assess liquidity, and determine if significant inputs have changed that would impact the fair value hierarchy disclosure.


			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of October 28, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	18,255	$	18,255	$	—	$	—
Marketable securities:
U.S. government agencies	5,531		—		5,531		—
Corporate bonds	11,767		—		11,767		—
Commercial paper	7,404		—		7,404		—



Total recurring fair value measurements	$	42,957	$	18,255	$	24,702	$	—









			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of January 28, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	41,642	$	41,642	$	—	$	—
Marketable securities:


U.S. government agencies	5,506		—		5,506		—
Corporate bonds	12,802		—		12,802		—
Commercial paper	6,369		—		6,369		—



Total recurring fair value measurements	$	66,319	$	41,642	$	24,677	$	—








			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of October 29, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	42,596	$	42,596	$	—	$	—
Marketable securities:


U.S. government agencies	3,479		—		3,479		—
Corporate bonds	10,709		—		10,709		—
Commercial paper	8,829		—		8,829		—

Noncurrent Assets
Deferred compensation plan	4,776		4,776		—		—
Total recurring fair value measurements	$	70,389	$	47,372	$	23,017	$	—

DEBT	9 Months Ended
DEBT	Oct. 28, 2023
Debt Disclosure [Abstract]
DEBT	DEBT On February 2, 2022, the Company and certain material domestic subsidiaries entered into Amendment No. 2 (“Amendment”) to its credit agreement (as amended, “Credit Agreement”), originally entered into on August 2, 2018 and amended October 30, 2020, by and among the Company, certain material domestic subsidiaries as co-borrowers and guarantors, Wells Fargo Bank, National Association (“Wells Fargo Bank”), as Agent, letter of credit issuer, and swing line lender, and certain lenders party thereto. Our obligations under the Credit Agreement are guaranteed by the guarantors and are secured by a first-priority lien on certain assets of the Company and certain material domestic subsidiaries, including inventory, accounts receivable, cash deposits, certain insurance proceeds, real estate, fixtures, and certain intellectual property. The Credit Agreement provides for a five-year Asset-Based Lending senior secured revolving loan (“ABL”) and letter of credit facility of up to $285.0 million, maturing February 2, 2027. The interest rate applicable to Term Secured Overnight Financing Rate (“SOFR”) loans drawn under the ABL is equal to Term SOFR plus 1.60% (subject to a further decrease to Term SOFR plus 1.35% or an increase to Term SOFR plus 1.85% based upon average quarterly excess availability under the ABL). The Credit Agreement also provides for a $15.0 million first-in last-out (“FILO”) loan. The interest rate applicable to the FILO is equal to Term SOFR plus 3.60% (subject to a further decrease to Term SOFR plus 3.35% or an increase to Term SOFR plus 3.85% based on average quarterly excess availability under the FILO). However, for any ABL or FILO with a SOFR interest rate period of six months, the interest rate applicable to the ABL and FILO is increased by 30 basis points. The Credit Agreement contains customary representations, warranties, and affirmative covenants, as well as customary negative covenants, that, among other things restrict, subject to certain exceptions, the ability of the Company and certain of its domestic subsidiaries to (i) incur liens, (ii) make investments, (iii) issue or incur additional indebtedness, (iv) undergo significant corporate changes, including mergers and acquisitions, (v) make dispositions, (vi) make restricted payments, (vii) prepay other indebtedness, and (viii) enter into certain other restrictive agreements. The Company may pay cash dividends and repurchase shares under its share buyback program, subject to certain thresholds of available borrowings, based upon the lesser of the aggregate amount of commitments under the Credit Agreement and the borrowing base, determined after giving effect to any such transaction or payment, on a pro forma basis. In addition, the Company must pay a commitment fee per annum on the unused portion of the commitments under the Credit Agreement. As of October 28, 2023, $24.0 million in net borrowings were outstanding under the Credit Agreement. Availability under the Credit Agreement is determined based upon a monthly borrowing base calculation, which includes eligible credit card receivables, real estate, and inventory, less outstanding borrowings, letters of credit, and certain designated reserves. As of October 28, 2023, the available additional borrowing capacity under the Credit Agreement was approximately $265.1 million, inclusive of the current loan cap of $30.0 million. As of October 28, 2023, deferred financing costs of $2.7 million were outstanding related to the Credit Agreement and are presented in other current assets in the accompanying unaudited condensed consolidated balance sheet.

SHARE REPURCHASES	9 Months Ended
SHARE REPURCHASES	Oct. 28, 2023
Equity [Abstract]
SHARE REPURCHASES	SHARE REPURCHASESDuring the thirty-nine weeks ended October 28, 2023, under our $300.0 million share repurchase program announced in November 2015 (“Prior Share Repurchase Program”), we repurchased 3.25 million shares at a total cost of approximately $19.8 million, at an average price of $6.09 per share. In June 2023, the Company authorized a new share repurchase program (“New Share Repurchase Program”) of up to $100.0 million of the Company’s common stock and cancelled the remaining $35.4 million available under the Prior Share Repurchase Program. As of October 28, 2023, the Company had $100.0 million remaining for future repurchases under the New Share Repurchase Program. However, we have no continuing obligation to repurchase shares under this authorization, and the timing, actual number, and purchase price of any shares purchased under the New Share Repurchase Program will depend on a variety of factors, including, but not limited to, the pending Merger, the market price of the Company’s common stock, general business and market conditions, other investment opportunities, and applicable legal and regulatory requirements

SUPPLIER FINANCE PROGRAM	9 Months Ended
SUPPLIER FINANCE PROGRAM	Oct. 28, 2023
Payables and Accruals [Abstract]
SUPPLIER FINANCE PROGRAM	SUPPLIER FINANCE PROGRAM In September 2022, the FASB issued ASU 2022-04, Liabilities - Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations, which enhances the transparency about the use of supplier finance programs for investors and other allocators of capital. The Company entered into a supplier financing agreement administered by a third-party platform in the fourth quarter of 2022. Payments to suppliers through this program began in the third quarter of fiscal 2023. Inclusion in the supplier financing program is by sole discretion of the Company, offering participating suppliers early payment of invoices through a third-party financial institution. The Company negotiates payment terms with each supplier separately, and inclusion in the financing program does not impact amounts due. One supplier is currently participating in the program with 90-day payment terms. The Company may on occasion submit debit memos to the third-party financial institution, and the financial institution agrees to work with the Company in applying these credits to future payments to suppliers. During the thirteen weeks ended October 28, 2023, no payments were made for invoices submitted through the supplier financing program. The outstanding payment obligation to the financial institution under this program was $2.2 million as of October 28, 2023, which is 1.7% of total trade payables obligations to suppliers.

COMMITMENTS AND CONTINGENCIES	9 Months Ended
COMMITMENTS AND CONTINGENCIES	Oct. 28, 2023
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES We are not currently a party to any material legal proceedings other than claims and lawsuits arising in the normal course of our business. All such matters are subject to uncertainties, and outcomes may not be predictable. Consequently, as of October 28, 2023, the ultimate aggregate amounts of monetary liability or financial impact with respect to such matters are not estimable. However, while such matters could affect our consolidated operating results when resolved in future periods, management believes that, upon final disposition, any monetary liability or financial impact to us would not be material to our annual consolidated financial statements.

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Pay vs Performance Disclosure
Net income	$ 5,040	$ 24,619	$ 104,270	$ 101,512

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Oct. 28, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Oct. 28, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Adoption of New Accounting Pronouncements

Fair Value Measurements

FAIR VALUE MEASUREMENTS

The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability on the measurement date. The three levels are defined as follows:


Level 1	—	Unadjusted quoted prices in active markets for identical assets or liabilities

Level 2	—	Unadjusted quoted prices in active markets for similar assets or liabilities; or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs other than quoted prices that are observable for the asset or liability

Level 3	—	Unobservable inputs for the asset or liability

Assets Measured on a Recurring Basis

Assets Measured on a Nonrecurring Basis

REVENUE RECOGNITION (Tables)

9 Months Ended

Oct. 28, 2023

Revenue from Contract with Customer [Abstract]

Schedule of Disaggregation of Revenue



	Thirteen Weeks Ended								Thirty-Nine Weeks Ended
	October 28, 2023				October 29, 2022				October 28, 2023				October 29, 2022
Chico’s	$	252,221	49.9	%	$	255,341	49.3	%	$	800,088	50.5	%	$	801,584	49.5	%
WHBM	147,498		29.2		157,451		30.4		451,016		28.4		485,061		30.0
Soma	105,407		20.9		105,540		20.3		333,891		21.1		331,322		20.5

Total Net Sales	$	505,126	100.0	%	$	518,332	100.0	%	$	1,584,995	100.0	%	$	1,617,967	100.0	%

Schedule of Contract Liabilities


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022


Beginning gift card liability	$	30,905	$	33,707	$	42,649	$	43,536
Issuances	7,602		7,878		26,585		28,218
Redemptions	(9,174)		(9,869)		(35,893)		(37,739)
Breakage adjustment	(162)		176		(4,170)		(2,123)
Ending gift card liability	$	29,171	$	31,892	$	29,171	$	31,892


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022


Beginning balance rewards deferred revenue	$	9,233	$	3,236	$	7,441	$	626
Net reduction in revenue	653		1,288		2,445		3,898
Ending balance rewards deferred revenue	$	9,886	$	4,524	$	9,886	$	4,524

LEASES (Tables)

9 Months Ended

Oct. 28, 2023

Leases [Abstract]

Schedule of Operating Lease Expense

Operating lease expense was as follows:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022
Operating lease cost (1)	$	58,132	$	55,608	$	169,916	$	163,271

Supplemental cash flow information related to operating leases was as follows:


	Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows	$	145,729	$	155,561
Right of use assets obtained in exchange for lease obligations, non-cash	145,342		88,484

Schedule of Supplemental Balance Sheet Information

Supplemental balance sheet information related to operating leases was as follows:


	October 28, 2023			January 28, 2023			October 29, 2022
Right of use assets	$	466,888		$	435,321		$	432,018

Current lease liabilities	$	150,053		$	153,202		$	157,687
Long-term lease liabilities	373,823			349,409			346,560
Total operating lease liabilities	$	523,876		$	502,611		$	504,247

Weighted Average Remaining Lease Term (years)	4.4			4.2			4.1

Weighted Average Discount Rate (1)	5.9		%	5.3		%	5.0		%

Schedule of Maturities of Operating Lease Liabilities

Maturities of operating lease liabilities as of October 28, 2023 were as follows:


Fiscal Year Ending:
February 3, 2024	$	48,986
February 1, 2025	171,076
January 31, 2026	129,459
January 30, 2027	95,434
January 29, 2028	66,278
Thereafter	92,906
Total future minimum lease payments	$	604,139
Less imputed interest	(80,263)
Total	$	523,876

SHARE-BASED COMPENSATION (Tables)

9 Months Ended

Oct. 28, 2023

Share-Based Payment Arrangement [Abstract]

Schedule of Restricted Stock Activity

Restricted stock award activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	4,611,801	$	4.02
Granted	2,146,506	5.85
Vested	(2,399,562)	3.77
Forfeited	(418,664)	5.02
Unvested, end of period	3,940,081	5.06

Restricted stock unit activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	406,218	$	2.46
Granted	27,462	5.28
Vested	(274,573)	2.17

Unvested, end of period	159,107	3.46

Schedule of Performance-Based Restricted Stock Unit Activity

PSU activity for the thirty-nine weeks ended October 28, 2023 was as follows:


	Number of Units/ Shares	Weighted Average Grant Date Fair Value
Unvested, beginning of period	2,696,449	$	3.48
Granted	1,239,354	5.70
Vested	(753,078)	3.17
Forfeited	(193,703)	5.45
Unvested, end of period	2,989,022	4.35

INCOME PER SHARE (Tables)

9 Months Ended

Oct. 28, 2023

Earnings Per Share [Abstract]

Schedule of Computation of Basic and Diluted Net Income Per Share

The following table sets forth the computation of net income per basic and diluted share shown on the face of the accompanying condensed consolidated statements of income:


	Thirteen Weeks Ended				Thirty-Nine Weeks Ended
	October 28, 2023		October 29, 2022		October 28, 2023		October 29, 2022

Numerator:
Net income	$	5,040	$	24,619	$	104,270	$	101,512
Net income allocated to participating securities	(2)		(47)		(113)		(370)
Net income available to common shareholders	$	5,038	$	24,572	$	104,157	$	101,142
Denominator:
Weighted average common shares outstanding – basic	119,457		120,333		119,424		119,776
Dilutive effect of non-participating securities	3,278		4,554		3,076		4,239
Weighted average common and common equivalent shares outstanding – diluted	122,735		124,887		122,500		124,016
Net income per common share:
Basic	$	0.04	$	0.20	$	0.87	$	0.84
Diluted	$	0.04	$	0.20	$	0.85	$	0.82

FAIR VALUE MEASUREMENTS (Tables)

9 Months Ended

Oct. 28, 2023

Fair Value Disclosures [Abstract]

Schedule of Financial Assets Valued on a Recurring Basis


			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of October 28, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	18,255	$	18,255	$	—	$	—
Marketable securities:
U.S. government agencies	5,531		—		5,531		—
Corporate bonds	11,767		—		11,767		—
Commercial paper	7,404		—		7,404		—



Total recurring fair value measurements	$	42,957	$	18,255	$	24,702	$	—









			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of January 28, 2023		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	41,642	$	41,642	$	—	$	—
Marketable securities:


U.S. government agencies	5,506		—		5,506		—
Corporate bonds	12,802		—		12,802		—
Commercial paper	6,369		—		6,369		—



Total recurring fair value measurements	$	66,319	$	41,642	$	24,677	$	—








			Fair Value Measurements at the End of the Reporting Date Using
	Balance as of October 29, 2022		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Recurring fair value measurements:
Current Assets
Cash equivalents:
Money market accounts	$	42,596	$	42,596	$	—	$	—
Marketable securities:


U.S. government agencies	3,479		—		3,479		—
Corporate bonds	10,709		—		10,709		—
Commercial paper	8,829		—		8,829		—

Noncurrent Assets
Deferred compensation plan	4,776		4,776		—		—
Total recurring fair value measurements	$	70,389	$	47,372	$	23,017	$	—

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - Merger Agreement with Daphne Parent LLC	Sep. 27, 2023 USD ($) $ / shares
Business Acquisition [Line Items]
Business combination, common stock, dividends (in dollars per share) \| $ / shares	$ 7.60
Merger agreement, termination fee \| $	$ 29,956,324

REVENUE RECOGNITION - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022	Jul. 29, 2023	Jan. 28, 2023	Jul. 30, 2022	Jan. 29, 2022
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 505,126	$ 518,332	$ 1,584,995	$ 1,617,967
Total net sales, as a percentage	100.00%	100.00%	100.00%	100.00%
Contract liabilities	$ 29,171	$ 31,892	$ 29,171	$ 31,892	$ 30,905	$ 42,649	$ 33,707	$ 43,536
Contract liability revenue recognized	6,200	7,000	25,300	27,000
Chico’s
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 252,221	$ 255,341	$ 800,088	$ 801,584
Total net sales, as a percentage	49.90%	49.30%	50.50%	49.50%
WHBM
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 147,498	$ 157,451	$ 451,016	$ 485,061
Total net sales, as a percentage	29.20%	30.40%	28.40%	30.00%
Soma
Disaggregation of Revenue [Line Items]
Total Net Sales	$ 105,407	$ 105,540	$ 333,891	$ 331,322
Total net sales, as a percentage	20.90%	20.30%	21.10%	20.50%

REVENUE RECOGNITION - Schedule of Gift Card Contract Liability (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Contract With Customer Liability [Roll Forward]
Beginning balance rewards deferred revenue	$ 30,905	$ 33,707	$ 42,649	$ 43,536
Issuances	7,602	7,878	26,585	28,218
Redemptions	(9,174)	(9,869)	(35,893)	(37,739)
Breakage adjustment	(162)	176	(4,170)	(2,123)
Ending balance rewards deferred revenue	$ 29,171	$ 31,892	$ 29,171	$ 31,892

REVENUE RECOGNITION - Schedule of Deferred Revenue Contract Liability (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Contract With Customer Liability [Roll Forward]
Beginning balance rewards deferred revenue	$ 30,905	$ 33,707	$ 42,649	$ 43,536
Ending balance rewards deferred revenue	29,171	31,892	29,171	31,892
Customer Rewards Program
Contract With Customer Liability [Roll Forward]
Beginning balance rewards deferred revenue	9,233	3,236	7,441	626
Net reduction in revenue	653	1,288	2,445	3,898
Ending balance rewards deferred revenue	$ 9,886	$ 4,524	$ 9,886	$ 4,524

LEASES - Schedule of Operating Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Leases [Abstract]
Operating lease cost	$ 58,132	$ 55,608	$ 169,916	$ 163,271
Variable lease cost	$ 14,300	$ 9,700	$ 41,100	$ 28,500

LEASES - Schedule of Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Oct. 28, 2023	Jan. 28, 2023	Oct. 29, 2022
Leases [Abstract]
Right of use assets	$ 466,888	$ 435,321	$ 432,018
Current lease liabilities	150,053	153,202	157,687
Long-term lease liabilities	373,823	349,409	346,560
Total operating lease liabilities	$ 523,876	$ 502,611	$ 504,247
Weighted Average Remaining Lease Term (years)	4 years 4 months 24 days	4 years 2 months 12 days	4 years 1 month 6 days
Weighted Average Discount Rate	5.90%	5.30%	5.00%

LEASES - Schedule of Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash outflows	$ 145,729	$ 155,561
Right of use assets obtained in exchange for lease obligations, non-cash	$ 145,342	$ 88,484

LEASES - Schedule of Maturities of Operating Lease Liabilities (Details) - USD ($) $ in Thousands	Oct. 28, 2023	Jan. 28, 2023	Oct. 29, 2022
Lessee, Operating Lease, Liability, Payment, Due [Abstract]
February 3, 2024	$ 48,986
February 1, 2025	171,076
January 31, 2026	129,459
January 30, 2027	95,434
January 29, 2028	66,278
Thereafter	92,906
Total future minimum lease payments	604,139
Less imputed interest	(80,263)
Total	$ 523,876	$ 502,611	$ 504,247

SHARE-BASED COMPENSATION - Narrative (Details) - USD ($) $ in Thousands, shares in Millions	1 Months Ended	9 Months Ended
	Mar. 31, 2022	Oct. 28, 2023	Oct. 29, 2022
Share-Based Payment Arrangement [Abstract]
Compensation expense related to stock-based awards		$ 9,136	$ 10,321
Number of shares available for future grants (in shares)		10.4
Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		3 years
Restricted Stock Awards \| CEO
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		4 years
Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years	1 year
Vesting percentage		100.00%
Performance-Based Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period		3 years
Tranche One \| Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage		50.00%
Tranche One \| Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage		50.00%
Tranche Two \| Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage		30.00%
Tranche Two \| Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage		30.00%
Tranche Three \| Restricted Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage		20.00%
Tranche Three \| Restricted Stock Units (RSUs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage		20.00%

SHARE-BASED COMPENSATION- Schedule of Restricted Stock Awards and Performance-based Restricted Stock Unit Activity (Details)	9 Months Ended
	Oct. 28, 2023 $ / shares shares
Restricted Stock Awards
Number of Units/ Shares
Unvested, beginning of period (in shares) \| shares	4,611,801
Granted (in shares) \| shares	2,146,506
Vested (in shares) \| shares	(2,399,562)
Forfeited (in shares) \| shares	(418,664)
Unvested, end of period (in shares) \| shares	3,940,081
Weighted Average Grant Date Fair Value
Unvested, beginning of period (in dollars per share) \| $ / shares	$ 4.02
Granted (in dollars per share) \| $ / shares	5.85
Vested (in dollars per share) \| $ / shares	3.77
Forfeited (in dollars per share) \| $ / shares	5.02
Unvested, end of period (in dollars per share) \| $ / shares	$ 5.06
Restricted Stock Units (RSUs)
Number of Units/ Shares
Unvested, beginning of period (in shares) \| shares	406,218
Granted (in shares) \| shares	27,462
Vested (in shares) \| shares	(274,573)
Unvested, end of period (in shares) \| shares	159,107
Weighted Average Grant Date Fair Value
Unvested, beginning of period (in dollars per share) \| $ / shares	$ 2.46
Granted (in dollars per share) \| $ / shares	5.28
Vested (in dollars per share) \| $ / shares	2.17
Unvested, end of period (in dollars per share) \| $ / shares	$ 3.46
Performance-Based Restricted Stock Units
Number of Units/ Shares
Unvested, beginning of period (in shares) \| shares	2,696,449
Granted (in shares) \| shares	1,239,354
Vested (in shares) \| shares	(753,078)
Forfeited (in shares) \| shares	(193,703)
Unvested, end of period (in shares) \| shares	2,989,022
Weighted Average Grant Date Fair Value
Unvested, beginning of period (in dollars per share) \| $ / shares	$ 3.48
Granted (in dollars per share) \| $ / shares	5.70
Vested (in dollars per share) \| $ / shares	3.17
Forfeited (in dollars per share) \| $ / shares	5.45
Unvested, end of period (in dollars per share) \| $ / shares	$ 4.35

INCOME TAXES (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
INCOME TAXES (Details) - USD ($) $ in Millions	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Income Tax Disclosure [Abstract]
Effective tax rate	50.30%	19.30%	4.30%	23.20%
CARES Act, COVID-19
Income Tax Examination [Line Items]
Income tax receivable	$ 7.9		$ 7.9

INCOME PER SHARE - Schedule of Computation of Basic and Diluted Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Numerator:
Net income	$ 5,040	$ 24,619	$ 104,270	$ 101,512
Net income allocated to participating securities	(2)	(47)	(113)	(370)
Net income available to common shareholders, basic	5,038	24,572	104,157	101,142
Net income available to common shareholders, diluted	$ 5,038	$ 24,572	$ 104,157	$ 101,142
Denominator:
Weighted average common shares outstanding – basic (in shares)	119,457	120,333	119,424	119,776
Dilutive effect of non-participating securities (in shares)	3,278	4,554	3,076	4,239
Weighted average common and common equivalent shares outstanding – diluted (in shares)	122,735	124,887	122,500	124,016
Net income per common share:
Basic (in dollars per share)	$ 0.04	$ 0.20	$ 0.87	$ 0.84
Diluted (in dollars per share)	$ 0.04	$ 0.20	$ 0.85	$ 0.82

INCOME PER SHARE - Narrative (Details) - shares shares in Millions	3 Months Ended		9 Months Ended
	Oct. 28, 2023	Oct. 29, 2022	Oct. 28, 2023	Oct. 29, 2022
Earnings Per Share [Abstract]
Number of antidilutive securities (in shares)	0.0	0.1	0.1	0.1

FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	Oct. 28, 2023	Jan. 28, 2023	Oct. 29, 2022
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
AFS securities, current	$ 22,200
AFS securities, noncurrent	2,500
Recurring
Current Assets
Money market accounts	18,255	$ 41,642	$ 42,596
Noncurrent Assets
Deferred compensation plan			4,776
Total recurring fair value measurements	42,957	66,319	70,389
Recurring \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Current Assets
Money market accounts	18,255	41,642	42,596
Noncurrent Assets
Deferred compensation plan			4,776
Total recurring fair value measurements	18,255	41,642	47,372
Recurring \| Significant Other Observable Inputs (Level 2)
Current Assets
Money market accounts	0	0	0
Noncurrent Assets
Deferred compensation plan			0
Total recurring fair value measurements	24,702	24,677	23,017
Recurring \| Significant Unobservable Inputs (Level 3)
Current Assets
Money market accounts	0	0	0
Noncurrent Assets
Deferred compensation plan			0
Total recurring fair value measurements	0	0	0
Recurring \| U.S. government agencies
Current Assets
Marketable securities	5,531	5,506	3,479
Recurring \| U.S. government agencies \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Current Assets
Marketable securities	0	0	0
Recurring \| U.S. government agencies \| Significant Other Observable Inputs (Level 2)
Current Assets
Marketable securities	5,531	5,506	3,479
Recurring \| U.S. government agencies \| Significant Unobservable Inputs (Level 3)
Current Assets
Marketable securities	0	0	0
Recurring \| Corporate bonds
Current Assets
Marketable securities	11,767	12,802	10,709
Recurring \| Corporate bonds \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Current Assets
Marketable securities	0	0	0
Recurring \| Corporate bonds \| Significant Other Observable Inputs (Level 2)
Current Assets
Marketable securities	11,767	12,802	10,709
Recurring \| Corporate bonds \| Significant Unobservable Inputs (Level 3)
Current Assets
Marketable securities	0	0	0
Recurring \| Commercial paper
Current Assets
Marketable securities	7,404	6,369	8,829
Recurring \| Commercial paper \| Quoted Prices in Active Markets for Identical Assets (Level 1)
Current Assets
Marketable securities	0	0	0
Recurring \| Commercial paper \| Significant Other Observable Inputs (Level 2)
Current Assets
Marketable securities	7,404	6,369	8,829
Recurring \| Commercial paper \| Significant Unobservable Inputs (Level 3)
Current Assets
Marketable securities	$ 0	$ 0	$ 0

DEBT (Details) - Revolving Credit Facility - USD ($)	Feb. 02, 2022	Oct. 28, 2023
Line of Credit
Debt Instrument [Line Items]
Long-term debt, term	5 years
Borrowing capacity	$ 285,000,000
Long-term debt		$ 24,000,000
Additional borrowing capacity		265,100,000
Excess availability of borrowing		30,000,000
Deferred financing costs		$ 2,700,000
Line of Credit \| SOFR
Debt Instrument [Line Items]
Interest rate (in percent)	1.60%
Line of Credit \| SOFR \| Minimum
Debt Instrument [Line Items]
Interest rate (in percent)	1.35%
Line of Credit \| SOFR \| Maximum
Debt Instrument [Line Items]
Interest rate (in percent)	1.85%
FILO
Debt Instrument [Line Items]
Borrowing capacity	$ 15,000,000
Basis points	0.30%
FILO \| Maximum
Debt Instrument [Line Items]
Interest rate (in percent)	3.85%
FILO \| SOFR
Debt Instrument [Line Items]
Interest rate (in percent)	3.60%
FILO \| SOFR \| Minimum
Debt Instrument [Line Items]
Interest rate (in percent)	3.35%

SHARE REPURCHASES (Details) - USD ($) $ / shares in Units, shares in Thousands	9 Months Ended
	Oct. 28, 2023	Jun. 30, 2023	Nov. 30, 2015
Prior Share Repurchase Program
Equity, Class of Treasury Stock [Line Items]
Shares authorized to be repurchased			$ 300,000,000
Shares repurchased (in shares)	3,250
Cost of shares repurchased	$ 19,800,000
Weighted average cost per share of shares repurchased (in dollars per share)	$ 6.09
Share repurchase program, amount remaining for future repurchases		$ 35,400,000
New Share Repurchase Program
Equity, Class of Treasury Stock [Line Items]
Shares authorized to be repurchased		$ 100,000,000
Share repurchase program, amount remaining for future repurchases	$ 100,000,000

SUPPLIER FINANCE PROGRAM (Details) $ in Millions	Oct. 28, 2023 USD ($) supplier
Supplier Finance Program [Line Items]
Supplier finance program, number of suppliers participated \| supplier	1
Supplier finance program, payment timing, period	90 days
Outstanding payment obligation \| $	$ 2.2
Supplier Concentration Risk \| Trade Payables \| Third Party Financial Institution
Supplier Finance Program [Line Items]
Concentration risk, percentage (in percent)	1.70%

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