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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 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 May 3, 2025


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

Commission file number: 001-35535

__________________________________________________

TILLY’S, INC.

(Exact name of Registrant as specified in its charter)

__________________________________________________


Delaware						45-2164791
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

10 Whatney

Irvine, CA 92618

(Address of principal executive offices)

(949) 609-5599

(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
Class A Common Stock, $0.001 par value per share	TLYS	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 and post 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.

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 Exchange Act Rule 12b-2) Yes ☐ No ☒

As of June 3, 2025, the registrant had the following shares of common stock outstanding:


Class A common stock $0.001 par value			22,845,799
Class B common stock $0.001 par value			7,306,108

Table of Contents

TILLY’S, INC.

FORM 10-Q

For the Quarterly Period Ended May 3, 2025

Index


		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	6
	Consolidated Balance Sheets as of May 3, 2025, February 1, 2025 and May 4, 2024	6
	Consolidated Statements of Operations for the Thirteen Weeks Ended May 3, 2025 and May 4, 2024	7
	Consolidated Statements of Comprehensive Loss for the Thirteen Weeks Ended May 3, 2025 and May 4, 2024	8
	Consolidated Statements of Stockholders’ Equity as of May 3, 2025 and May 4, 2024	9
	Consolidated Statements of Cash Flows for the Thirteen Weeks Ended May 3, 2025 and May 4, 2024	10
	Notes to the Consolidated Financial Statements	11

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

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28

Item 4.	Controls and Procedures	28

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	28

Item 1A.	Risk Factors	29

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	29

Item 5.	Other Information	29

Item 6.	Exhibits	29

	Signatures	30

Table of Contents

Forward-Looking Statements

This Quarterly Report on Form 10-Q (this "Report") contains forward-looking statements that are subject to risks and uncertainties. All statements other than statements of historical or current fact included in this Report are forward-looking statements. Forward-looking statements refer to our current expectations and projections relating to our financial condition, results of operations, plans, objectives, strategies, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as “anticipate”, “estimate”, “expect”, “project”, “plan”, “intend”, “believe”, “may”, “might”, “will”, “should”, “can have”, “likely” and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating or financial performance or other events. For example, all statements we make relating to our estimated and projected earnings, revenues, comparable store sales, operating income, earnings per share, costs, expenditures, cash flows, growth rates and financial results, our plans and objectives for future operations, growth or initiatives, strategies or the expected outcome or impact of pending or threatened litigation are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those that we expected, including:

•Our recent history of operating losses, and our potential need to commence borrowing under our credit facility and/or to acquire additional liquidity;

•the impacts of inflation on consumer spending generally and on our expense management, operating results and financial condition;

•our ability to adapt to declines in consumer confidence and decreases in consumer spending;

•the impact of fluctuations in the price and availability of raw materials, labor, and transportation;

•our ability to compete effectively in an environment of intense competition in stores, online and via social media marketing platforms;

•our ability to effectively manage inventory levels;

•most of our merchandise is made in foreign countries, making price and availability of our merchandise susceptible to international trade conditions, including tariffs;

•our ability to adapt to changing trends in traffic for our stores and changes in our customers' purchasing patterns;

•our ability to identify and respond to new and changing customer fashion preferences and fashion-related trends;

•our ability to secure desirable lease arrangements and other economics to improve our profitability;

•our ability to successfully open new stores, profitably operate our existing stores, and/or to cost-effectively close unprofitable stores ahead of natural lease expirations;

•our ability to attract customers to our website and generate acceptable levels of return from our digital marketing efforts and other e-com growth initiatives;

•our ability to generate adequate cash from our existing stores and e-com to support our business;

•our ability to generate sufficient undiscounted cash flows to recover our investment in long-lived and right-of-use assets;

•our ability to generate sufficient pre-tax income to fully utilize our deferred tax assets;

•the success of the malls, power centers, neighborhood and lifestyle centers, outlet centers and street-front locations in which our stores are located;

•our ability to adapt to unseasonable weather impacting sales of our seasonal merchandise;

•our dependence on third-party vendors to provide us with sufficient quantities of merchandise at acceptable prices and on time;

•our ability to adapt to significant changes in sales due to the seasonality of our business;

•our dependence upon key executive management or our inability to hire or retain the talent required for our business;

•our ability to establish, maintain and enhance a strong brand image;

•our ability to balance proprietary branded merchandise with the third-party branded merchandise we sell;

•our ability to efficiently utilize our e-com fulfillment center;

•our ability to generate sufficient cash flows to make significant periodic lease payments for our stores, corporate offices and distribution centers;

•our ability to attract customers in the various retail venues and geographies in which our stores are located;

•our ability to respond to litigation claims we are subject to;

•our ability to respond to changes in employment and wage and hour laws;

•failure of our vendors and their manufacturing sources to use acceptable labor or other practices;

•our ability to effectively respond to disruptions in our supply chain and distribution center;

•our ability to adjust to increasing costs of mailing catalogs, paper and printing;

•failure of our information technology systems to support our business, before and after our planned upgrades;

•our ability to secure our data and comply with privacy laws and the security standards of the credit card industry;

•disruptions to our information systems in the ordinary course of business, as a result of systems upgrades or due to intentional attacks;

•our ability to protect our trademarks or other intellectual property rights;

•our potential liability if we or our vendors unknowingly infringe upon the intellectual property rights of third parties;

Table of Contents

•natural disasters, unusually adverse weather conditions, port delays, boycotts, epidemics, pandemics, acts of war, terrorism, civil unrest and other unanticipated events;

•the potential effects of unionization and work stoppages or slowdowns by our employees;

•continuing costs incurred as a result of being a public company; and

•our ability to respond to risks associated with climate change, environmental, social and governance initiatives, and sustainability initiatives.

We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and it is impossible for us to anticipate all factors that could affect our actual results.

See “Risk Factors” within our most recent Annual Report on Form 10-K for a more complete discussion of the risks and uncertainties mentioned above and for discussion of other risks and uncertainties. All forward-looking statements attributable to us are expressly qualified in their entirety by these cautionary statements as well as others made in this Report and hereafter in our other SEC filings and public communications. You should evaluate all forward-looking statements made by us in the context of these risks and uncertainties.

We caution you that the risks and uncertainties identified by us may not be all of the factors that are important to you. Furthermore, the disclosures and forward-looking statements included in this Report are made only as of the date hereof. We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.

Table of Contents

Part I. Financial Information

Item 1. Financial Statements (Unaudited)

TILLY’S, INC.

CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

(Unaudited)


	May 3, 2025		February 1, 2025		May 4, 2024
ASSETS
Current assets:
Cash and cash equivalents	$	27,231	$	21,056	$	19,880
Marketable securities	9,973		25,653		48,142
Receivables	4,914		4,094		7,135
Merchandise inventories	75,572		69,178		78,535
Prepaid expenses and other current assets	9,297		10,979		9,742
Total current assets	126,987		130,960		163,434
Operating lease assets	167,369		169,805		199,613
Property and equipment, net	37,876		40,139		45,442

Other assets	1,919		1,559		1,522
TOTAL ASSETS	$	334,151	$	342,463	$	410,011

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	31,778	$	11,120	$	22,013
Accrued expenses	12,317		12,750		12,712

Deferred revenue	13,305		14,116		14,127
Accrued compensation and benefits	7,537		9,418		8,457

Current portion of operating lease liabilities	47,931		48,384		52,662
Current portion of operating lease liabilities, related party	3,501		3,423		3,194
Other liabilities	141		172		253
Total current liabilities	116,510		99,383		113,418
Noncurrent portion of operating lease liabilities	123,452		126,216		151,875
Noncurrent portion of operating lease liabilities, related party	14,937		15,844		18,438
Other liabilities	137		149		278
Total long-term liabilities	138,526		142,209		170,591
Total liabilities	255,036		241,592		284,009
Commitments and contingencies (Notes 2 and 5)
Stockholders’ equity:
Common stock (Class A), $0.001 par value; 100,000 shares authorized; 22,846, 22,846 and 22,751 shares issued and outstanding, respectively	23		23		23
Common stock (Class B), $0.001 par value; 35,000 shares authorized; 7,306, 7,306 and 7,306 shares issued and outstanding, respectively	7		7		7
Preferred stock, $0.001 par value; 10,000 shares authorized; no shares issued or outstanding	—		—		—
Additional paid-in capital	175,269		174,829		173,197
Accumulated deficit	(96,343)		(74,191)		(47,583)
Accumulated other comprehensive income	159		203		358
Total stockholders’ equity	79,115		100,871		126,002
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	334,151	$	342,463	$	410,011

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

Table of Contents

TILLY’S, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Net sales	$	107,611	$	115,856

Cost of goods sold (includes buying, distribution, and occupancy costs)	85,394		90,612
Rent expense, related party	932		931
Total cost of goods sold (includes buying, distribution, and occupancy costs)	86,326		91,543
Gross profit	21,285		24,313

Selling, general and administrative expenses	43,841		44,968
Rent expense, related party	133		133
Total selling, general, and administrative expenses	43,974		45,101

Operating loss	(22,689)		(20,788)
Other income, net	398		1,154
Loss before income taxes	(22,291)		(19,634)
Income tax benefit	(139)		(13)
Net loss	$	(22,152)	$	(19,621)
Basic net loss per share of Class A and Class B common stock	$	(0.74)	$	(0.65)
Diluted net loss per share of Class A and Class B common stock	$	(0.74)	$	(0.65)
Weighted average basic shares outstanding	30,060		29,962
Weighted average diluted shares outstanding	30,060		29,962

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

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TILLY’S, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(In thousands)

(Unaudited)


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Net loss	$	(22,152)	$	(19,621)
Other comprehensive (loss) income, net of tax:
Net change in unrealized (loss) gain on available-for-sale securities, net of tax	(44)		35
Other comprehensive (loss) income, net of tax	(44)		35
Comprehensive loss	$	(22,196)	$	(19,586)

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

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TILLY’S, INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)


	Number of Shares
	Common Stock (Class A)	Common Stock (Class B)	Common Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Income (Loss)		Total Stockholders’ Equity
Balance at February 1, 2025	22,846	7,306	$	30	$	174,829	$	(74,191)	$	203	$	100,871
Net loss	—	—	—		—		(22,152)		—		(22,152)




Share-based compensation expense	—	—	—		440		—		—		440


Net change in unrealized loss on available-for-sale securities	—	—	—		—		—		(44)		(44)
Balance at May 3, 2025	22,846	7,306	$	30	$	175,269	$	(96,343)	$	159	$	79,115


	Number of Shares
	Common Stock (Class A)	Common Stock (Class B)	Common Stock		Additional Paid-in Capital		(Accumulated Deficit) Retained Earnings		Accumulated Other Comprehensive Income		Total Stockholders’ Equity
Balance at February 3, 2024	22,714	7,306	$	30	$	172,478	$	(27,962)	$	323	$	144,869
Net loss	—	—	—		—		(19,621)		—		(19,621)

Share-based compensation expense	—	—	—		566		—		—		566
Employee stock option exercises	37	—	—		153		—		—		153

Net change in unrealized gain on available-for-sale securities	—	—	—		—		—		35		35
Balance at May 4, 2024	22,751	7,306	$	30	$	173,197	$	(47,583)	$	358	$	126,002

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

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TILLY’S, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Cash flows from operating activities:
Net loss	$	(22,152)	$	(19,621)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	2,828		3,095

Share-based compensation expense	440		566
Impairment of assets	1,008		1,663
(Gain) loss on disposal of assets	15		(16)
Gain on maturities of marketable securities	(180)		(708)

Changes in operating assets and liabilities:
Receivables	(740)		(822)
Merchandise inventories	(6,394)		(15,376)
Prepaid expenses and other assets	1,559		2,690
Accounts payable	20,658		7,480
Accrued expenses	176		14
Accrued compensation and benefits	(1,881)		(1,445)
Operating lease liabilities	(2,602)		(2,254)
Deferred revenue	(811)		(830)
Other liabilities	(43)		(126)
Net cash used in operating activities	(8,119)		(25,690)

Cash flows from investing activities:
Purchases of marketable securities	—		(29,496)
Purchases of property and equipment	(1,522)		(2,137)


Proceeds from maturities of marketable securities	15,816		30,000
Proceeds from sale of property and equipment	—		23

Net cash provided by (used in) investing activities	14,294		(1,610)

Cash flows from financing activities:


Proceeds from exercise of stock options	—		153
Net cash provided by financing activities	—		153

Change in cash and cash equivalents	6,175		(27,147)
Cash and cash equivalents, beginning of period	21,056		47,027
Cash and cash equivalents, end of period	$	27,231	$	19,880

Supplemental disclosures of cash flow information:

Income taxes refunded	$	(92)	$	(14)
Supplemental disclosure of non-cash activities:
Unpaid purchases of property and equipment	$	67	$	724
Operating lease liabilities arising from obtaining operating lease assets	$	11,756	$	9,886

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

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TILLY’S, INC.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1: Description of the Company and Basis of Presentation

Tillys is a destination specialty retailer of casual apparel, footwear, accessories and hardgoods for young men, young women, boys and girls with an extensive assortment of iconic global, emerging, and proprietary brands rooted in an active, outdoor and social lifestyle. Tillys is headquartered in Irvine, California and operated 238 stores, in 33 states as of May 3, 2025. Our stores are located in malls, lifestyle centers, ‘power’ centers, community centers, outlet centers and street-front locations. Customers may also shop online at www.tillys.com, where we feature the same assortment of products as carried in our brick-and-mortar stores, supplemented by additional online-only styles. Our goal is to serve as a destination for the latest, most relevant merchandise and brands important to our customers.

The Tillys concept began in 1982, when our co-founders, Hezy Shaked and Tilly Levine, opened their first store in Orange County, California. Since 1984, the business has been conducted through World of Jeans & Tops, a California corporation, or “WOJT”, which operates under the name “Tillys”. In May 2011, Tilly’s, Inc., a Delaware corporation, was formed solely for the purpose of reorganizing the corporate structure of WOJT in preparation for an initial public offering. As part of the initial public offering in May 2012, WOJT became a wholly owned subsidiary of Tilly's, Inc.

The consolidated financial statements include the accounts of Tilly's, Inc. and WOJT. All intercompany accounts and transactions have been eliminated in consolidation.

As used in these Notes to the Consolidated Financial Statements, except where the context otherwise requires or where otherwise indicated, the terms "the Company", "we", "our", "us" and "Tillys" refer to Tilly's, Inc. and its subsidiary, WOJT.

We have prepared the accompanying unaudited consolidated financial statements in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial reporting. These unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted from this Quarterly Report on Form 10-Q as is permitted by SEC rules and regulations.

In the opinion of management, the accompanying unaudited consolidated financial statements contain all normal and recurring adjustments necessary to present fairly the financial condition, results of operations and cash flows for the interim periods presented. The results of operations for the thirteen-week period ended May 3, 2025 are not necessarily indicative of results to be expected for the full fiscal year. The accompanying unaudited consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our Annual Report on Form 10-K for the fiscal year ended February 1, 2025 ("fiscal 2024").

Fiscal Periods

Our fiscal year ends on the Saturday closest to January 31. References to fiscal 2025 refer to the fiscal year ending January 31, 2026. References to the fiscal quarters or first three months ended May 3, 2025 and May 4, 2024 refer to the thirteen week periods ended as of those dates, respectively.

Note 2: Summary of Significant Accounting Policies

Information regarding our significant accounting policies is contained in Note 2, “Summary of Significant Accounting Policies”, of the consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended February 1, 2025.

Revenue Recognition

Revenue is recognized for store sales when the customer receives and pays for the merchandise at the register, net of estimated returns and taxes collected from our customers. For e-commerce ("e-com") net sales, we recognize revenue, net of sales taxes and estimated sales returns, and the related cost of goods sold at the time the merchandise is shipped to the customer. Amounts related to shipping and handling that are billed to customers are reflected in net sales, and the related costs are reflected in cost of goods sold in the Consolidated Statements of Operations.

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The following table summarizes net sales from our retail stores and e-com (in thousands):


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Retail stores	$	85,912	$	92,822
E-com	21,699		23,034
Total net sales	$	107,611	$	115,856

The following table summarizes the percentage of net sales by department:


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Mens	36	%	36	%
Womens	31	%	31	%
Footwear	13	%	13	%
Accessories	12	%	12	%
Boys	4	%	4	%
Girls	4	%	4	%
Total net sales	100	%	100	%

The following table summarizes the percentage of net sales by third-party and proprietary branded merchandise:


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Third-party	63	%	66	%
Proprietary	37	%	34	%
Total net sales	100	%	100	%

We accrue for estimated sales returns by customers based on historical sales return results. As of May 3, 2025, February 1, 2025 and May 4, 2024, our reserve for sales returns was $1.3 million, $1.2 million and $1.5 million, respectively, and is included in accrued expenses on the accompanying Consolidated Balance Sheets.

We recognize revenue from gift cards as they are redeemed for merchandise. Prior to redemption, we maintain a current liability for unredeemed gift card balances. The customer liability balance was $8.8 million, $9.5 million and $9.4 million as of May 3, 2025, February 1, 2025 and May 4, 2024, respectively, and is included in deferred revenue on the accompanying Consolidated Balance Sheets. Our gift cards do not have expiration dates, and in most cases there is no legal obligation to remit unredeemed gift cards to relevant jurisdictions. Based on actual historical redemption patterns, we determined that a small percentage of gift cards are unlikely to be redeemed (which we refer to as gift card "breakage"). Based on our historical gift card breakage rate, we recognize breakage revenue over the redemption period in proportion to actual gift card redemptions. Revenue recognized from gift cards was $2.3 million and $2.6 million for the thirteen weeks ended May 3, 2025 and May 4, 2024, respectively. For the thirteen weeks ended May 3, 2025 and May 4, 2024, the opening gift card balance was $9.5 million and $10.2 million, respectively, of which $1.4 million and $1.7 million, respectively, were recognized as revenue during these periods.

We have a customer loyalty program where customers accumulate points based on purchase activity. Once a loyalty member achieves a certain point level, the member earns an award that may be used towards the purchase of merchandise. Unredeemed awards and accumulated partial points are accrued as deferred revenue and awards redeemed by the member for merchandise are recorded as an increase to net sales. Our loyalty program allows customers to redeem their awards instantly or build up to additional awards over time. Unredeemed awards and accumulated partial points expire 365 days after the customer's original purchase date. A liability is estimated based on the standalone selling price of points earned and expected future redemptions. The deferred revenue for this program was $4.6 million, $4.6 million, and $4.8 million as of May 3, 2025, February 1, 2025 and May 4, 2024, respectively. The value of points redeemed through our loyalty program was $1.3 million and $1.6 million for the thirteen-weeks ended May 3, 2025 and May 4, 2024, respectively. For the thirteen weeks ended May 3, 2025 and May 4, 2024,

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the opening loyalty program balance was $4.6 million and $4.7 million, respectively, of which $1.2 million was recognized as revenue during each of these periods.

Property and Equipment, net

Property and equipment are stated at cost less accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets. Equipment is depreciated over five to seven years. Furniture and fixtures are depreciated over five years. Computer software is depreciated over three years. Leasehold improvements and the cost of acquiring leasehold rights are amortized over the lesser of the term of the lease or the estimated useful life of the improvement. The cost of assets sold or retired and the related accumulated depreciation is removed from the accounts with any resulting gain or loss included in net loss in the accompanying Consolidated Statements of Operations.

Repairs and maintenance costs are charged directly to expense as incurred. Major renewals, replacements and improvements that substantially extend the useful life of an asset are capitalized and depreciated.

At May 3, 2025, February 1, 2025 and May 4, 2024, property and equipment consisted of the following (in thousands):


	May 3, 2025		February 1, 2025		May 4, 2024
Leasehold improvements	$	156,839	$	156,461	$	159,933
Computer hardware and software	48,992		48,807		47,817
Furniture and fixtures	44,517		44,493		46,432
Machinery and equipment	34,068		34,029		34,662
Vehicles	2,222		2,222		2,307
Construction in progress	2,796		2,945		4,388
Property and equipment, gross	289,434		288,957		295,539
Accumulated depreciation	(251,558)		(248,818)		(250,097)
Property and equipment, net	$	37,876	$	40,139	$	45,442

Depreciation expense related to property and equipment was $2.8 million and $3.1 million for the thirteen-weeks ended May 3, 2025 and May 4, 2024, respectively.

Leases

We conduct all of our retail sales and corporate operations in leased facilities. Lease terms generally range up to 10 years in duration (subject to elective extensions) and provide for escalations in base rents. Many of our store leases contain one or more options to renew the lease at our sole discretion. Generally, we do not consider any additional renewal periods to be reasonably certain of being exercised.

Most store leases include tenant allowances from landlords, rent escalation clauses and/or contingent rent provisions. Certain leases provide for additional rent based on a percentage of sales and annual rent increases generally based upon the Consumer Price Index. In addition, most of our store leases are net leases, which typically require us to be responsible for certain property operating expenses, including property taxes, insurance, common area maintenance, in addition to base rent. Many of our store leases contain certain co-tenancy provisions that permit us to pay rent based on a pre-determined percentage of sales when the occupancy of the retail center falls below minimums established in the lease. For non-cancelable operating lease agreements, operating lease assets and operating lease liabilities are established for leases with an expected term greater than one year, and we recognize a single lease cost, with such cost allocated over the lease term, on a straight-line basis. We do not record any leases with terms of 12 months or less as operating lease assets or operating lease liabilities, these are instead expensed as incurred. Contingent rent, determined based on a percentage of net sales in excess of specified levels, is recognized as rent expense when the achievement of those specified net sales is probable.

Our operating leases typically include non-lease components such as common-area maintenance costs, utilities, and other maintenance costs. We have elected to include non-lease components with the lease payments for the purpose of calculating the lease right-of-use assets and liabilities to the extent that they are fixed. Non-lease components that are not fixed are expensed as incurred as variable lease payments.

We lease approximately 172,000 square feet of office and warehouse space (10 and 12 Whatney, Irvine, California) from a company that is owned by the co-founders of Tillys. During each of the thirteen-week periods ended May 3, 2025 and May 4, 2024, we incurred rent expense of $0.5 million related to this lease. Pursuant to the lease agreement, the lease payment adjusts annually based upon the Los Angeles/Anaheim/Riverside Urban Consumer Price Index (the "LAARUCPI"), not to exceed 7%. The lease began on January 1, 2003 and terminates on December 31, 2027.

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We lease approximately 26,000 square feet of office and warehouse space (11 Whatney, Irvine, California) from a company that is owned by one of the co-founders of Tillys. During each of the thirteen-week periods ended May 3, 2025 and May 4, 2024 we incurred rent expense of $0.2 million related to this lease. Pursuant to the lease agreement, the lease payment adjusts annually at the greater of 5% or the change in the LAARUCPI. The lease began on June 29, 2012 and terminates on June 30, 2032.

We lease approximately 81,000 square feet of office and warehouse space (17 Pasteur, Irvine, California) from a company that is owned by one of the co-founders of Tillys. We use this property as our e-com distribution center. During each of the thirteen-week periods ended May 3, 2025 and May 4, 2024 we incurred rent expense of $0.4 million related to this lease. The lease payment adjusts annually based upon the greater of 5% or the change in the LAARUCPI. The lease began on November 1, 2011 and terminates on October 31, 2031.

We sublease a portion of our office space, approximately 5,887 square feet, in the 17 Pasteur, Irvine, California facility to Tilly's Life Center ("TLC"), a related party and a charitable organization. During the thirteen-week periods ended May 3, 2025 and May 4, 2024 we recorded sublease income of $24.5 thousand and $23.4 thousand, respectively, related to this lease. The lease term is for five years and terminates on January 31, 2027. Sublease income is recognized on a straight-line basis over the sublease agreement and is recorded as an offset within the selling, general and administrative section in the Consolidated Statements of Operations.

The maturity of operating lease liabilities and sublease income as of May 3, 2025 were as follows (in thousands):


Fiscal Year	Related Party		Other		Total		Sublease Income
2025	$	3,196	$	46,101	$	49,297	$	75
2026	4,411		45,018		49,429		105
2027	4,167		34,903		39,070		—
2028	2,251		25,230		27,481		—
2029	2,363		18,382		20,745		—
Thereafter	4,710		34,240		38,950		—
Total minimum lease payments	21,098		203,874		224,972		180
Less: Amount representing interest	2,660		32,491		35,151		—
Present value of operating lease liabilities	$	18,438	$	171,383	$	189,821	$	180

As of May 3, 2025, additional operating lease liabilities that had not yet commenced were $0.9 million.

Lease expense for the thirteen-week periods ended May 3, 2025 and May 4, 2024 was as follows (in thousands):


	Thirteen Weeks Ended
	May 3, 2025						May 4, 2024
	Cost of goods sold		SG&A		Total		Cost of goods sold		SG&A		Total
Fixed operating lease expense	$	16,497	$	341	$	16,838	$	16,779	$	361	$	17,140
Variable lease expense	3,574		12		3,586		3,706		8		3,714
Total lease expense	$	20,071	$	353	$	20,424	$	20,485	$	369	$	20,854

Supplemental lease information for the thirteen weeks ended May 3, 2025 and May 4, 2024 was as follows:

Thirteen Weeks Ended

May 3, 2025

May 4, 2024

Cash paid for amounts included in the measurement of operating lease liabilities (in thousands)

$17,614

$18,360

Weighted average remaining lease term (in years)

4.9 years

5.1 years

Weighted average interest rate (1)

6.82%

6.64%

(1) Since our leases do not provide an implicit rate, we used our incremental borrowing rate ("IBR") at lease inception, or lease modification, in determining the present value of future minimum payments. In determining an appropriate IBR, our assumptions included the use of a consistent discount rate for a portfolio of leases entered into at varying dates, the full 10-year term of the lease, excluding any options, and the total minimum lease payments.

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Income Taxes

Our effective income tax rate was 0.6% of pre-tax loss, compared to 0.1% of pre-tax loss, for the thirteen weeks ended May 3, 2025 and May 4, 2024, respectively. Both years' income tax rates include the continuing impact of a full, non-cash deferred tax asset valuation allowance. The income tax rate for fiscal 2025 also includes the refund of certain income tax credit carry forwards and state income tax carry back claims.

Recently Adopted Accounting Standards

In November 2023, the FASB issued Accounting Standards Update, Segment reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”), which amended Topic 280. The amendments in this update enhance segment reporting by expanding the breadth and frequency of segment disclosures required by public entities. ASU 2023-07 requires public entities to disclose factors used to identify the entities' reportable segments, how the Chief Operating Decision Maker (“CODM”) uses the reported measure(s) of a segment's profit or loss to assess segment performance and decide how to allocate resources, significant expenses regularly provided to the CODM and included within the reported measure(s) of a segment's profit or loss, types of products and services from which each reportable segment derives its revenues, and the title and position of the CODM. The new standard is effective for public entities with fiscal years beginning after December 15, 2023 and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and is required to be adopted retrospectively for all prior periods presented in the consolidated financial statements. This guidance was effective for us for the annual report for fiscal 2024 and subsequent interim periods and we have adopted the guidance as of the effective date on a retrospective basis. Other than the new disclosure requirements, the adoption of this guidance did not have a significant impact on our consolidated financial statements. Refer to "Note 9: Segment Information" for further information.

New Accounting Standards Not Yet Adopted

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, (“ASU 2023-09”). ASU 2023-09 requires disaggregated information about a reporting entity's effective tax rate reconciliation as well as information on income taxes paid and other disclosures. The new standard is effective for public entities with annual periods beginning after December 15, 2024, with early adoption permitted and should be applied prospectively with the option of retrospective application. Once adopted, we expect to include additional income tax disclosures as required by the new guidance. The standard will not have an impact on our consolidated financial position, results of operations and cash flows.

In November 2024, the FASB issued ASU 2024-03, Income Statement (Subtopic 220-40): Reporting Comprehensive Income - Expense Disaggregation Disclosures: Disaggregation of Income Statement Expenses, ("ASU 2024-03"). ASU 2024-03 requires public business entities to disclose in the notes to the financial statements, among other things, specific information about certain costs and expenses including purchases of inventory, employee compensation, and depreciation and amortization. This new standard is effective for fiscal years beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early adoption permitted and should be applied prospectively with the option of retrospective application. We are currently evaluating the impact of this guidance on our consolidated financial statements.

Note 3: Marketable Securities

Marketable securities consist of commercial paper, classified as available-for-sale, and fixed income securities, classified as held-to-maturity, as we have the intent and ability to hold them to maturity. Our investments in commercial paper and fixed income securities are recorded at fair value and amortized cost, respectively, which approximates fair value. All of our marketable securities are less than one year from maturity.

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The following table summarizes our investments in marketable securities at May 3, 2025, February 1, 2025 and May 4, 2024 (in thousands):


	May 3, 2025
	Cost or Amortized Cost		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Estimated Fair Value
Commercial paper	$	9,817	$	156	$	—	$	9,973

Total marketable securities	$	9,817	$	156	$	—	$	9,973

	February 1, 2025
	Cost or Amortized Cost		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Estimated Fair Value
Commercial paper	$	19,868	$	200	$	—	$	20,068
Fixed income securities	5,585		—		—		5,585

Total marketable securities	$	25,453	$	200	$	—	$	25,653

	May 4, 2024
	Cost or Amortized Cost		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Estimated Fair Value
Commercial paper	$	34,158	$	355	$	—	$	34,513
Fixed income securities	13,629		—		—		13,629
Total marketable securities	$	47,787	$	355	$	—	$	48,142

We recognized gains on investments for commercial paper that matured during the thirteen-week periods ended May 3, 2025 and May 4, 2024. In determining those gains, we used the actual cost of the securities sold. Upon recognition of the gains, we reclassified these amounts out of "Accumulated other comprehensive income" and into “Other income, net” on the Consolidated Statements of Operations.

The following table summarizes our gains on investments for commercial paper (in thousands):


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Gains on investments	$	216	$	589

Note 4: Asset-Backed Credit Agreement

On April 27, 2023 (the “Closing Date”), we entered into an asset-backed credit agreement and revolving line of credit note (the "Note" and, collectively, the “Credit Agreement”) with Wells Fargo Bank, National Association, as lender (the “Bank”). The Credit Agreement provides for an asset-based, senior secured revolving credit facility (as amended, the "Revolving Facility”) of up to $65.0 million (“Revolving Commitment”) consisting of revolving loans, letters of credit and swing line loans, with a sub-limit on letters of credit outstanding at any time of $10.0 million and a sub-limit for swing line loans of $7.5 million, which replaced our previous senior secured credit agreement. The Credit Agreement also includes an uncommitted accordion feature whereby we may increase the Revolving Commitment by an aggregate amount not to exceed $12.5 million, subject to certain conditions. On March 25, 2025, we entered into an amendment of the Credit Agreement which extended the maturity date to June 25, 2027. The payment and performance in full of the secured obligations under the Revolving Facility are secured by a lien on and security interest in all of our assets.

The maximum borrowings permitted under the Revolving Facility is equal to the lesser of (x) the Revolving Commitment and (y) the applicable borrowing base, which is equal to (i) 90% of our eligible credit card receivables, plus (ii) 90% of the cost of certain adjusted eligible inventory, less certain inventory reserves, plus (iii) 90% of the cost of certain adjusted eligible in-transit inventory, less certain inventory reserves, less (iv) certain other reserves established by the Bank.

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The unused portion of the Revolving Commitment accrues a commitment fee of 0.25% or 0.375% per annum, based on the average daily borrowing capacity under the Revolving Facility under the applicable fiscal quarter. Borrowings under the Revolving Facility bear interest at a rate per annum that ranges from the Secured Overnight Financing Rate (“SOFR”) plus a credit spread adjustment (equal to 10 basis points for one- and three-month term SOFR) plus 1.50% to 2.00%, or a base rate (as calculated in accordance with the Credit Agreement) (the “Base Rate”) plus 0.50% to 1.00%, based on the average daily borrowing capacity under the Revolving Facility over the applicable fiscal quarter. We are allowed to elect to apply either SOFR or Base Rate interest to borrowings at our discretion, other than in the case of swing line loans, to which the Base Rate shall apply.

Under the Credit Agreement, we are subject to a variety of affirmative and negative covenants customary in an asset-based lending facility, including a financial covenant relating to availability (which is required to remain above the greater of: (i) ten percent (10%) of the Loan Cap (as defined in the Credit Agreement) and (ii) $6.0 million).

Events of default under the Credit Agreement include, among other things, failure to pay principal, interest, fees or other amounts; covenant defaults; material inaccuracy of representations and warranties; bankruptcy events; actual or asserted invalidity of any the Credit Agreement or related loan documents; or a change of control.

In connection with the entry into the Credit Agreement, we entered into certain ancillary agreements including (i) a security agreement in favor of the Bank, and (ii) a guarantee by us in favor of the Bank.

As of May 3, 2025, we were in compliance with all of our covenants, were eligible to borrow up to a total of $55.4 million and had no outstanding borrowings under the Credit Agreement. The only utilization of the letters of credit sub-limit under the Credit Agreement was a $2.0 million irrevocable standby letter of credit.

Note 5: Commitments and Contingencies

Indemnifications, Commitments, and Guarantees

During the normal course of business, we have made certain indemnifications, commitments, and guarantees under which we may be required to make payments for certain transactions. These indemnifications include, but are not limited to, those given to various lessors in connection with facility leases for certain claims arising from such facility or lease and indemnifications to our directors and officers to the maximum extent permitted under the laws of the state of Delaware. The majority of these indemnifications, commitments, and guarantees do not provide for any limitation of the maximum potential future payments we could be obligated to make, and their duration may be indefinite. We have not recorded any liability for these indemnifications, commitments, and guarantees in the accompanying Consolidated Balance Sheets.

Legal Proceedings

From time to time, we may become involved in lawsuits and other claims arising from our ordinary course of business. We establish loss provisions for matters in which losses are probable and can be reasonably estimated. For some matters, we are currently unable to predict the ultimate outcome, determine whether a liability has been incurred or make an estimate of the reasonably possible liability that could result from an unfavorable outcome because of the uncertainties related to the occurrence, amount and range of loss on any pending litigation or claim. Because of the unpredictable nature of these matters, we cannot provide any assurances regarding the outcome of any litigation or claim to which we are a party or that the ultimate outcome of any of the matters threatened or pending against us will not have a material adverse effect on our financial condition, results of operations or cash flows. As of the date of these consolidated financial statements, we were not engaged in any legal proceedings that are expected, individually or in the aggregate, to have a material adverse effect on our consolidated results of operations or financial position.

Note 6: Fair Value Measurements

We determine fair value based on a three-level valuation hierarchy as described below. Fair value is defined as the exit price associated with the sale of an asset or transfer of a liability in an orderly transaction between market participants at the measurement date. The three-level hierarchy of inputs used to determine fair value is as follows:

•Level 1 – Quoted prices in active markets for identical assets and liabilities.

•Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets and liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•Level 3 – Unobservable inputs (i.e. projections, estimates, interpretations, etc.) that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

We measure certain financial assets at fair value on a recurring basis, including our marketable securities which are classified as available-for-sale securities, and certain cash equivalents, specifically money market securities, commercial paper, municipal

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bonds and certificates of deposits. The money market accounts are valued based on quoted market prices in active markets. The available-for-sale marketable securities are 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 entities.

From time to time, we measure certain assets at fair value on a non-recurring basis, including evaluation of long-lived assets for impairments using Company-specific assumptions which would fall within Level 3 of the fair-value hierarchy.

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.

As of May 3, 2025, February 1, 2025 and May 4, 2024, we did not have any Level 3 financial assets. 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.

Financial Assets

In accordance with the provisions of ASC 820, Fair Value Measurement, we categorized our financial assets based on the priority of the inputs to the valuation technique for the instruments as follows (in thousands):


	May 3, 2025						February 1, 2025						May 4, 2024
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Cash equivalents (1):
Money market securities	$	22,919	$	—	$	—	$20,685		$	—	$	—	$18,691		$	—	$	—


Marketable securities:
Commercial paper	$	—	$	9,973	$	—	$	—	$	20,068	$	—	$	—	$	34,513	$	—

(1) Excludes cash of $4.3 million, $0.4 million and $1.2 million as of May 3, 2025, February 1, 2025 and May 4, 2024, respectively.

Impairment of Long-Lived Assets

On at least a quarterly basis, we assess whether events or changes in circumstances have occurred that potentially indicate that the carrying value of long-lived assets and operating lease right-of-use ("ROU") assets may not be recoverable. Based on Level 3 inputs of historical operating performance, including sales trends, gross margin rates, current cash flows from operations and the projected outlook for each of our stores, we determine if a store would be able to generate sufficient undiscounted cash flows over the remaining term to recover our investment in long-lived and ROU assets. If the undiscounted future cash flows are less than the carrying value, an impairment loss is recognized for the difference between the carrying value and the estimated fair value of assets based on the discounted cash flows of the assets using a rate that approximates the weighted average cost of capital plus a company-specific risk premium. Impairment losses are allocated between the long-lived assets and ROU assets on a relative carrying amount basis. The fair values of ROU assets are estimated by an independent third party and represent the highest and best use to a market participant. We determined that certain stores would not be able to generate sufficient cash flows over the remaining term of the related leases to recover our investment or the ROU in the respective stores. As a result of this assessment, we recorded non-recurring, non-cash impairment charges of $1.0 million and $1.7 million in the thirteen-weeks ended May 3, 2025 and May 4, 2024, respectively, to write-down the carrying value of certain long-lived store assets and ROU assets to their estimated fair values.


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
	($ in thousands)

Carrying value of assets with impairment	$	3,722	$	3,555
Fair value of assets impaired	$	2,714	$	1,892
Number of stores tested for impairment	69		43
Number of stores with impairment	12		11

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Note 7: Share-Based Compensation

The Tilly's, Inc. 2012 Second Amended and Restated Equity and Incentive Plan, as amended in June 2020 (the "2012 Plan"), authorizes up to 6,613,900 shares for issuance of options, shares or rights to acquire our Class A common stock and allows for, among other things, operating income and comparable store sales growth targets as additional performance goals that may be used in connection with performance-based awards granted under the 2012 Plan. As of May 3, 2025, there were 965,998 shares available for future issuance under the 2012 Plan.

Stock Options

We grant stock options to certain employees that give them the right to acquire our Class A common stock under the 2012 Plan. The exercise price of options granted is equal to the closing price per share of our stock at the date of grant. The non-qualified options vest at a rate of 25% on each of the first four anniversaries of the grant date provided that the award recipient continues to be employed by us through each of those vesting dates and expire ten years from the date of grant.

The following table summarizes stock option activity for the thirteen weeks ended May 3, 2025 (aggregate intrinsic value in thousands):


	Stock Options	Grant Date Weighted Average Exercise Price		Weighted Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value (1)
Outstanding at February 1, 2025	2,100,895	$	7.79
Granted	501,000	$	2.19

Forfeited	(26,125)	$	6.35
Expired	(146,750)	$	7.46
Outstanding at May 3, 2025	2,429,020	$	6.67	7.6	$	—
Exercisable at May 3, 2025	1,174,520	$	8.73	5.9	$	—

(1)Intrinsic value for stock options is defined as the difference between the market price of our Class A common stock on the last business day of the fiscal period and the weighted average exercise price of in-the-money stock options outstanding at the end of the fiscal period. The market value per share was $1.50 at May 3, 2025.

The stock option awards were measured at fair value on the grant date using the Black-Scholes option valuation model. Key input assumptions used to estimate the fair value of stock options include the exercise price of the award, the expected option term, expected volatility of our stock over the option’s expected term, the risk-free interest rate over the option’s expected term and our expected annual dividend yield, if any. We account for forfeitures as they occur. We issue shares of Class A common stock when stock option awards are exercised.

The fair values of stock options granted during the thirteen weeks ended May 3, 2025 and May 4, 2024 were estimated on the grant date using the following assumptions:


	Thirteen Weeks Ended
	May 3, 2025			May 4, 2024
Weighted average grant-date fair value per option granted	$	1.20		$	3.68
Expected option term (1)	5.4 years			5.6 years
Weighted average expected volatility factor (2)	57.0		%	54.8		%
Weighted average risk-free interest rate (3)	4.0		%	4.3		%
Expected annual dividend yield (4)	—		%	—		%

(1)The expected option term of the awards represents the estimated time that options are expected to be outstanding based upon historical option data.

(2)Stock volatility for each grant is measured using the historical daily price changes of our common stock over the most recent period equal to the expected option term of the awards.

(3)The risk-free interest rate is determined using the rate on treasury securities with the same term as the expected life of the stock option as of the grant date.

(4)We do not currently have a dividend policy, and we do not currently anticipate paying any cash dividends on our common stock at this time.

Restricted Stock Awards

Restricted stock awards ("RSAs") represent restricted shares issued upon the date of grant in which the recipient's rights in the stock are restricted until the shares are vested, whereas restricted stock units ("RSUs") represent shares issuable in the future

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upon vesting. Under the 2012 Plan, we grant RSAs to independent members of our Board of Directors and RSUs to certain employees. RSAs granted to Board members vest at a rate of 50% on each of the first two anniversaries of the grant date provided that the respective award recipient continues to serve on our Board of Directors through each of those vesting dates. The RSUs granted to certain employees vest at a rate of 25% on each of the first four anniversaries of the grant date provided that the respective recipient continues to be employed by us through each of those vesting dates. We determine the fair value of restricted stock underlying the RSAs and RSUs based upon the closing price of our Class A common stock on the date of grant.

The following table summarizes the status of non-vested restricted stock as of May 3, 2025, and the changes since February 1, 2025:


	Restricted Stock	Weighted Average Grant-Date Fair Value
Nonvested at February 1, 2025	91,719	$	5.67
Granted	—	—
Vested	—	—

Nonvested at May 3, 2025	91,719	$	5.67

Share-based compensation expense associated with stock options and restricted stock is recognized on a straight-line basis over the requisite service period. The following table summarizes share-based compensation expense recorded in the Consolidated Statements of Operations (in thousands):


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Cost of goods sold	$	70	$	81
Selling, general, and administrative	370		485
Total share-based compensation	$	440	$	566

At May 3, 2025, there was $3.2 million of total unrecognized share-based compensation expense related to unvested stock options and restricted stock. This cost has a weighted average remaining recognition period of 2.6 years.

Note 8: Net Loss Per Share

Earnings per share is computed under the provisions of ASC 260, Earnings Per Share. Basic earnings per share is computed based on the weighted average number of shares of common stock outstanding during the period. Diluted earnings per share is computed based on the weighted average number of shares of common stock plus the effect of dilutive potential shares of common stock (i.e., in-the-money outstanding stock options as well as RSAs) outstanding during the period using the treasury stock method, whereby proceeds from such exercise, unamortized compensation and hypothetical excess tax benefits, if any, on share-based awards are assumed to be used by us to purchase shares of common stock at the average market price during the period.

The components of basic and diluted net loss per share were as follows (in thousands, except per share amounts):


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Net loss	$	(22,152)	$	(19,621)
Weighted average basic shares outstanding	30,060		29,962
Dilutive effect of in-the-money stock options and RSAs	—		—
Weighted average shares for diluted net loss per share	30,060		29,962
Basic net loss per share of Class A and Class B common stock	$	(0.74)	$	(0.65)
Diluted net loss per share of Class A and Class B common stock	$	(0.74)	$	(0.65)

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The following stock options and restricted stock have been excluded from the calculation of diluted net loss per share as the effect of including these stock options would have been anti-dilutive (in thousands):


	Thirteen Weeks Ended
	May 3, 2025	May 4, 2024
Stock options	2,428	2,578
Restricted stock	61	—
Total	2,489	2,578

Note 9: Segment Information

Tillys operates in one, consolidated operating and reportable segment, which is as a retailer of casual apparel, footwear, accessories, and hardgoods (the "retail segment"). Our chief operating decision maker ("CODM") is our Co-Founder, Executive Chairman of the Board of Directors, President and Chief Executive Officer. Our CODM reviews financial information on a consolidated basis for the purposes of evaluating financial performance, allocating resources and making operational decisions.

The retail segment derives revenues from our stores located in a variety of retail centers in the United States and via our website. We identified one reportable segment based on the similar nature of products sold, production, merchandising and distribution processes involved, target customers, and economic characteristics.

The CODM measures performance for the segment primarily based on operating (loss) income. The CODM uses operating (loss) income to evaluate operating performance and determine allocation of resources to seek to promote improved performance.

The measure of segment assets is reported as total assets on the Consolidated Balance Sheet. The accounting policies of the retail segment are the same as those described in "Note 2: Summary of Significant Accounting Policies".

Financial information, including segment revenue, significant expenses, and operating loss for the thirteen week periods ended May 3, 2025 and May 4, 2024 were as follows (in thousands):


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Net sales	$	107,611	$	115,856
Product COGS (1)	51,007		55,415
Occupancy (2)	24,163		25,095
Other COGS (3)	11,156		11,033
Gross profit	21,285		24,313
Store payroll and related benefits	19,978		20,925
Marketing	5,094		4,437
Other selling costs (4)	4,624		4,719
Office costs (5)	14,278		15,020
Operating loss	(22,689)		(20,788)
Other income, net	398		1,154
Income tax benefit	(139)		(13)
Net loss	$	(22,152)	$	(19,621)

(1) Product COGS consists of branded and private label merchandise costs, including design, sourcing, and inbound freight costs.

(2) Occupancy consists of store operating lease charges and depreciation.

(3) Other COGS consists of buying, and distribution costs, including but not limited to outbound shipping costs, buying and distribution payroll and related benefits, depreciation, and temporary labor.

(4) Other selling costs consists primarily of e-com fulfillment labor, credit card processing fees, store supplies and equipment, and other store services.

(5) Office costs consists primarily of corporate office payroll and related benefits, computer services, non-cash asset impairment charges, consulting and professional services, and insurance.

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

The following discussion and analysis of the financial condition and results of our operations should be read together with the financial statements and related notes of Tilly’s, Inc. included in Part I Item 1 of this Quarterly Report on Form 10-Q (this "Report") and with our audited consolidated financial statements and the related notes included in our Annual Report on Form 10-K for the fiscal year ended February 1, 2025. As used in this Report, except where the context otherwise requires or where otherwise indicated, the terms “the Company”, “World of Jeans & Tops”, “we”, “our”, “us”, "Tillys" and “Tilly’s” refer to Tilly’s, Inc. and its subsidiary.

Overview

Tillys is a destination specialty retailer of casual apparel, footwear, accessories and hardgoods for young men, young women, boys and girls. We believe we bring together an unparalleled selection of iconic global, emerging, and proprietary brands rooted in an active, outdoor and social lifestyle. The Tillys concept began in 1982, when our co-founders, Hezy Shaked and Tilly Levine, opened our first store in Orange County, California. As of May 3, 2025, we operated 238 stores in 33 states, averaging approximately 7,174 square feet per store, compared to 246 total stores at the same time last year. We also sell our products through our e-commerce ("e-com") website, www.tillys.com.

Known or Anticipated Trends

We believe the combined impacts of persistent inflation, potential tariffs, and concerns about a potential economic recession in the current economic environment could negatively impact consumer spending generally and our customer base, in particular, which has had and may in the future have a significant, adverse impact on our operating results and financial condition.

Inflation has resulted in increased costs for many products and services that are necessary for the operation of our business, such as product costs, labor costs, shipping costs, and digital marketing costs, among others. For example, store payroll and payroll-related expenses represented approximately 45% of our total selling, general and administrative expense in the first quarter of fiscal 2025. Our average hourly rate for store payroll in fiscal 2025 is estimated to be approximately 35% higher than in pre-pandemic fiscal 2019 and approximately 3% higher than in fiscal 2024. These and other cost increases may continue to have a material adverse impact on our results of operations and financial condition in fiscal 2025, particularly if we are unable to generate net sales growth.

Based on our current projections, we do not anticipate needing to initiate borrowings under our credit facility at any time during fiscal 2025. We estimate that it would take a consistent comparable net sales decrease of approximately 10% or more over the course of the remainder of fiscal 2025 to require any level of borrowing this year.

We expect our effective income tax rate to be near zero on an annual basis until such time that we are able to return to generating operating profits on a consistent basis, due to maintaining a full valuation allowance on all deferred tax assets as a result of our recent operating losses.

We currently expect to close 12 stores during fiscal 2025, seven of which have already closed through May 2025, three additional closures are expected to occur in the second quarter, and two are expected to occur in the third quarter. The number of store closures during fiscal 2025 may increase by up to as many as 15 additional stores by the end of the fiscal year depending on the outcome of lease renewal negotiations with landlords.

How We Assess the Performance of Our Business

In assessing the performance of our business, we consider a variety of performance and financial measures. The key indicators of the financial condition and operating performance of our business are net sales, comparable store sales, gross profit, selling, general and administrative ("SG&A") expenses and operating loss.

Net Sales

Net sales reflect revenue from the sale of our merchandise at store locations and through e-com, net of sales taxes. Store net sales are reflected in sales when the merchandise is received by the customer. For e-com net sales, we recognize revenue, and the related cost of goods sold at the time the merchandise is shipped to the customer. Net sales also include shipping and handling fees for e-com shipments that have been shipped to the customer. Net sales are net of returns on sales during the period as well as an estimate of returns expected in the future stemming from current period sales. We recognize revenue from gift cards as they are redeemed for merchandise. Prior to redemption, we maintain a current liability for unredeemed gift card balances. Our gift cards do not have expiration dates and in most cases there is no legal obligation to remit unredeemed gift cards to relevant jurisdictions. Based on actual historical redemption patterns, we determined that a small percentage of gift cards are unlikely to be redeemed (which we refer to as gift card “breakage”). Based on our historical gift card breakage rate, we recognize breakage revenue over the redemption period in proportion to actual gift card redemptions.

Our business is seasonal and as a result our revenues fluctuate from quarter to quarter. In addition, our revenues in any given quarter can be affected by a number of factors including the timing of holidays and weather patterns. The third and fourth

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quarters of the fiscal year, which include the back-to-school and holiday sales seasons, have historically produced stronger sales and disproportionately stronger operating results than have the first two quarters of the fiscal year.

Comparable Store Net Sales

Comparable store net sales is a measure that indicates the change in year-over-year comparable store net sales, which allows us to evaluate how our store base is performing. Numerous factors affect our comparable store net sales, including:

•overall economic trends;

•our ability to attract traffic to our stores and online platform;

•our ability to identify and respond effectively to consumer preferences and fashion trends;

•competition;

•the timing of our releases of new and seasonal styles;

•changes in our product mix;

•pricing;

•the level of customer service that we provide in stores;

•our ability to source, distribute and allocate products efficiently;

•calendar shifts of holiday or seasonal periods;

•the number and timing of store openings and the relative proportion of new stores to mature stores; and

•the timing and success of promotional and advertising efforts.

Our comparable store net sales are defined as net sales from our physical stores open on a daily basis combined with net sales from our e-com website compared to the same respective fiscal dates of the prior year. A remodeled, relocated or refreshed store is included in comparable store net sales, both during and after construction, if the square footage of the store used to sell merchandise was not changed by more than 20% in any fiscal month. We include net sales from our e-com website as part of comparable store net sales as we manage and analyze our business on a single omni-channel basis and have substantially integrated our investments and operations for our stores and e-com website to give our customers seamless access and increased ease of shopping. Comparable store net sales exclude gift card breakage income and e-com shipping and handling fee revenue. Some of our competitors and other retailers may calculate comparable or “same store” net sales differently than we do. As a result, data in this Report regarding our comparable store net sales may not be comparable to similar data made available by other retailers.

Gross Profit

Gross profit is equal to our net sales less our cost of goods sold. Cost of goods sold reflects the direct cost of purchased merchandise as well as buying, distribution and occupancy costs. Buying costs include compensation and benefit expense for our internal buying organization. Distribution costs include costs for receiving, processing and warehousing our store merchandise, and shipping of merchandise to or from our distribution and e-com fulfillment centers, and to our e-com customers and between store locations. Occupancy costs include the rent, common area maintenance, utilities, property taxes, security and depreciation costs of all store locations. These costs are significant and can be expected to continue to increase relative to business growth. The components of our reported cost of goods sold may not be comparable to those of other retail companies.

We regularly analyze the components of gross profit as well as gross profit as a percentage of net sales. Specifically we look at the initial markup on purchases, markdowns and reserves, shrinkage, buying costs, distribution costs and occupancy costs. Any inability to obtain acceptable levels of initial markups, a significant increase in our use of markdowns or a significant increase in inventory shrinkage or inability to generate sufficient sales leverage on the buying, distribution and occupancy components of cost of goods sold could have an adverse impact on our gross profit and results of operations.

Gross profit is also impacted by shifts in the proportion of sales of proprietary branded products compared to third-party branded products, as well as by sales mix shifts within and between brands and between major product departments such as young men's and women's apparel, footwear or accessories. A substantial shift in the mix of products could have a material impact on our results of operations. In addition, gross profit and gross profit as a percent of sales have historically been higher in the third and fourth quarters of the fiscal year, as these periods include the back-to-school and winter holiday selling seasons. This reflects that various costs, including occupancy costs, generally do not increase in proportion to the seasonal sales increase.

Selling, General and Administrative Expenses

Our selling, general and administrative ("SG&A") expenses are comprised of store selling expenses and corporate-level general and administrative expenses. Store selling expenses include store and regional support costs, including personnel, advertising and debit and credit card processing costs, e-com receiving and processing costs and store supplies costs. General and administrative expenses include the payroll and support costs of corporate functions such as executive management, legal, accounting, information systems, human resources, impairment charges and other centralized services. Store selling expenses generally vary proportionately with net sales and store growth. In contrast, general and administrative expenses are generally

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not directly proportional to net sales and store growth but may be expected to increase over time to support the needs of our company. SG&A expenses as a percentage of net sales are usually higher in lower volume periods and lower in higher volume periods.

Operating Loss

Operating loss equals gross profit less SG&A expenses. Operating loss excludes interest income, interest expense and income taxes. Operating loss percentage measures operating loss as a percentage of our net sales.

Results of Operations

The following tables summarize key components of our unaudited results of operations for the periods indicated, both in dollars (in thousands) and as a percentage of our net sales:


	Thirteen Weeks Ended
	May 3, 2025			May 4, 2024
Statements of Operations Data:
Net sales	$	107,611		$	115,856
Cost of goods sold	85,394			90,612
Rent expense, related party	932			931
Total cost of goods sold	86,326			91,543
Gross profit	21,285			24,313
Selling, general and administrative expenses	43,841			44,968
Rent expense, related party	133			133
Total selling, general and administrative expenses	43,974			45,101
Operating loss	(22,689)			(20,788)
Other income, net	398			1,154
Loss before income taxes	(22,291)			(19,634)
Income tax benefit	(139)			(13)
Net loss	$	(22,152)		$	(19,621)

Percentage of Net Sales:
Net sales	100.0		%	100.0		%
Cost of goods sold	79.4		%	78.2		%
Rent expense, related party	0.9		%	0.8		%
Total cost of goods sold	80.2		%	79.0		%
Gross profit	19.8		%	21.0		%
Selling, general and administrative expenses	40.7		%	38.8		%
Rent expense, related party	0.1		%	0.1		%
Total selling, general and administrative expenses	40.9		%	38.9		%
Operating loss	(21.1)		%	(17.9)		%
Other income, net	0.4		%	1.0		%
Loss before income taxes	(20.7)		%	(16.9)		%
Income tax benefit	(0.1)		%	0.0		%
Net loss	(20.6)		%	(16.9)		%

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The following table presents store operating data for the periods indicated:


	Thirteen Weeks Ended
	May 3, 2025			May 4, 2024
Operating Data:
Stores operating at end of period	238			246
Comparable store net sales change (1)	(7.0)		%	(9.4)		%
Total square feet at end of period (in '000s)	1,707			1,784
Average net sales per physical store (in '000s) (2)	$	353		$	373
Average net sales per square foot (2)	$	49		$	51
E-com net sales (in '000s) (3)	$	21,699		$	23,034
E-com net sales as a percentage of net sales	20.2		%	19.9		%

(1)Our comparable store net sales are defined as sales from our physical stores open on a daily basis combined with net sales from our e-com website compared to the same respective fiscal dates of the prior year. A remodeled or relocated store is included in comparable store net sales, both during and after construction, if the square footage of the store used to sell merchandise was not changed by more than 20% in any fiscal month. We include sales from our e-com website as part of our comparable store net sales as we manage and analyze our business on an omni-channel basis and have substantially integrated our investments and operations for our stores and e-com website to give our customers seamless access and increased ease of shopping. Comparable store net sales exclude gift card breakage income, and e-com shipping and handling fee revenue.

(2)The number of stores and the amount of square footage reflect the number of days during the period that stores were open. E-com net sales, e-com shipping and handling fee revenue and gift card breakage income are excluded from net sales in deriving average net sales per retail store and average net sales per square foot.

(3)E-com net sales include e-com net sales and e-com shipping and handling fee revenue.

First Quarter (13 Weeks) Ended May 3, 2025 Compared to First Quarter (13 Weeks) Ended May 4, 2024

Net Sales

Total net sales were $107.6 million, a decrease of 7.1%. Total comparable net sales, including both physical stores and e-com, decreased by 7.0% relative to the comparable 13-week period ended May 4, 2024.

•Net sales from physical stores were $85.9 million, a decrease of 7.4%. Comparable store net sales decreased 7.1% relative to the comparable 13-week period ended May 4, 2024. Net sales from physical stores represented 79.8% of total net sales this year compared to 80.1% total net sales last year. We ended the first quarter with 238 total stores compared to 246 total stores at the end of the first quarter last year.

•E-com net sales were $21.7 million, a decrease of 5.8%. E-com net sales decreased 6.6% relative to the comparable 13-week period ended May 4, 2024. E-com net sales represented 20.2% of total net sales this year compared to 19.9% of total net sales last year.

Gross Profit

Gross profit was $21.3 million, or 19.8% of net sales, compared to $24.3 million, or 21.0% of net sales, last year. Product margins improved by 40 basis points primarily due to improved initial markups, partially offset by increased inventory valuation reserves. Buying, distribution, and occupancy costs deleveraged by 160 basis points collectively, despite being $0.8 million lower than last year, primarily due to carrying these costs against a lower level of net sales this year.

Selling, General and Administrative Expenses

SG&A expenses were $44.0 million, or 40.9% of net sales, compared to $45.1 million, or 38.9% of net sales, last year. Primary SG&A variances, both in terms of percentage of net sales and total dollars, were as follows:


%	$ millions	Primarily Attributable to
0.5%	$(0.9)	Decrease in store payroll and related benefits.
(0.3)%	(0.5)	Decrease in non-cash impairment and other asset write-off charges.
0.9%	0.7	Increase in marketing expenses.
0.8%	(0.4)	Net change from all other SG&A expenses.

1.9%	$(1.1)	Total

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Operating Loss

Operating loss was $22.7 million, or 21.1% of net sales, compared to $20.8 million, or 17.9% of net sales, last year primarily as a result of the combination of the factors noted above.

Income Tax Benefit

Income tax benefit was $0.1 million, or 0.6% of pre-tax loss, compared to $13 thousand, or 0.1% of pre-tax loss, last year. Both period's income tax results include the continuing impact of a full, non-cash deferred tax asset valuation allowance. The income tax benefit for the first quarter of fiscal 2025 also includes the refund of certain income tax credit carry forwards and state income tax carry back claims.

Net Loss and Loss Per Share

Net loss was $22.2 million, or $0.74 net loss per share, compared to $19.6 million, or $0.65 net loss per share, last year.

Liquidity and Capital Resources

Our business relies on cash flows from operating activities as well as cash on hand as our primary sources of liquidity. We currently expect to finance company operations, new store openings and remodels, and all of our planned capital expenditures with existing cash on hand, marketable securities and cash flows from operations.

In addition to cash and cash equivalents and marketable securities, the most significant components of our working capital are merchandise inventories, accounts payable and accrued expenses. We believe that cash flows from operating activities, our cash and marketable securities on hand, and credit facility availability will be sufficient to cover our working capital requirements and anticipated capital expenditures for the next 12 months from the filing of this Report. If cash flows from operations are not sufficient or available to meet our capital requirements, then we will be required to obtain additional equity or debt financing in the future. There can be no assurance that equity or debt financing will be available to us when we need it or, if available, that the terms will be satisfactory to us and not dilutive to our stockholders.

Working Capital

Working capital at May 3, 2025, was $10.5 million compared to $31.6 million at February 1, 2025, a decrease of $21.1 million. The primary changes in our working capital during the first quarter of fiscal 2025 were as follows:


$ millions			Description
$31.6			Working capital at February 1, 2025
(14.3)			Decrease primarily due to an increase in accounts payable, net of merchandise inventories.
(9.5)			Decrease in cash, cash equivalents, and marketable securities primarily due to lower net sales.
2.7			Net change from all other changes in current assets and current liabilities.
$10.5			Working capital at May 3, 2025

Cash Flow Analysis

A summary of operating, investing and financing activities for the thirteen weeks ended May 3, 2025 compared to the thirteen weeks ended May 4, 2024 is shown in the following table (in thousands):


	Thirteen Weeks Ended
	May 3, 2025		May 4, 2024
Net cash used in operating activities	$	(8,119)	$	(25,690)
Net cash provided by (used in) investing activities	14,294		(1,610)
Net cash provided by financing activities	—		153
Net change in cash and cash equivalents	$	6,175	$	(27,147)

Net Cash Used in Operating Activities

Operating activities consist primarily of net loss adjusted for non-cash items that include depreciation and amortization, asset impairment charges, deferred income taxes, gains on maturities of marketable securities and share-based compensation expense, plus the effect on cash of changes during the year in our assets and liabilities.

Net cash used in operating activities was $8.1 million this year compared to $25.7 million last year. The $17.6 million decrease in net cash used in operating activities compared to last year was primarily due to a decrease in merchandise inventory balances

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and an increase in related accounts payable as a result of efficient management of merchandise inventories and timing of payments, respectively.

Net Cash Provided by (Used in) Investing Activities

Cash flows from investing activities consist primarily of capital expenditures and maturities and purchases of marketable securities.

Net cash provided by investing activities was $14.3 million this year compared to net cash used of $1.6 million last year. Net cash provided by investing activities in the first quarter of fiscal 2025 consisted of maturities of marketable securities of $15.8 million, partially offset by capital expenditures totaling $1.5 million. Net cash used in investing activities in the first quarter of fiscal 2024 consisted of purchases of marketable securities of $29.5 million and capital expenditures totaling $2.1 million, partially offset by maturities of marketable securities of $30.0 million.

Net Cash Provided by Financing Activities

Financing activities primarily consist of proceeds from employee exercises of stock options.

Credit Agreement

On April 27, 2023 (the “Closing Date”), we entered into an asset-backed credit agreement and revolving line of credit note (the "Note" and, collectively, the “Credit Agreement”) with Wells Fargo Bank, National Association, as lender (the “Bank”). The Credit Agreement provides for an asset-based, senior secured revolving credit facility (as amended, the “Revolving Facility”) of up to $65.0 million (“Revolving Commitment”) consisting of revolving loans, letters of credit and swing line loans, with a sub-limit on letters of credit outstanding at any time of $10.0 million and a sub-limit for swing line loans of $7.5 million, which replaced our previous senior secured credit agreement. The Credit Agreement also includes an uncommitted accordion feature whereby we may increase the Revolving Commitment by an aggregate amount not to exceed $12.5 million, subject to certain conditions. On March 25, 2025, we entered into an amendment of the Credit Agreement which extended the maturity date to June 25, 2027. The payment and performance in full of the secured obligations under the Revolving Facility are secured by a lien on and security interest in all of our assets.

Contractual Obligations

As of May 3, 2025, there were no material changes to our contractual obligations as described in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of our Annual Report on Form 10-K for the fiscal year ended February 1, 2025.

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Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires the appropriate application of certain accounting policies, some of which require us to make estimates and assumptions about future events and their impact on amounts reported in our consolidated financial statements. Since future events and their impact cannot be determined with absolute certainty, the actual results will inevitably differ from our estimates. A summary of our significant accounting policies is included in Note 2 to the consolidated financial statements in our Annual Report on Form 10-K for the fiscal year ended February 1, 2025.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

As of May 3, 2025, there were no material changes in the market risks described in the “Quantitative and Qualitative Disclosure About Market Risks” section of our Annual Report on Form 10-K for the fiscal year ended February 1, 2025.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our management, including our Chief Executive Officer and our Chief Financial Officer, with the participation of our Disclosure Committee, evaluated the effectiveness of our disclosure controls and procedures as of May 3, 2025. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to its management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Based on the evaluation of our disclosure controls and procedures as of May 3, 2025, our Chief Executive Officer and Chief Financial Officer concluded that, as of such date, our disclosure controls and procedures were effective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting

There was no change in our internal control over financial reporting identified in connection with the evaluation required by Rule 13a-15(d) and 15d-15(d) of the Exchange Act that occurred during the thirteen weeks ended May 3, 2025 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations on Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, believes that our disclosure controls and procedures and internal control over financial reporting are designed to provide reasonable assurance of achieving their objectives and are effective at the reasonable assurance level. However, our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Part II. Other Information

Item 1. Legal Proceedings

The information contained in “Note 5: Commitments and Contingencies” to our consolidated financial statements included in this Report is incorporated by reference into this Item.

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Item 1A. Risk Factors

We operate in a rapidly changing environment that involves a number of risks that could materially and adversely affect our business, financial condition, prospects, operating results or cash flows. In addition to the other information set forth in this Report, please refer to the section titled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended February 1, 2025 for a detailed discussion of the risks that affect our business.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Not applicable.

Item 5. Other Information

During the quarterly period ended May 3, 2025, none of our officers or directors adopted or terminated any “Rule 10b5-1 trading arrangement” or any “non-Rule 10b5-1 trading arrangement,” in each case, as such terms are defined in Item 408 of Regulation S-K

Item 6. Exhibits


Exhibit No.						Description of Exhibit





10.1#						First Amendment to Credit Agreement, dated March 25, 2025, by and among World of Jeans & Tops, Tilly's Inc., and Wells Fargo Bank, National Association (incorporated by reference to Exhibit 10.1 to the Form 8-K filed by the Company on March 27, 2025).

31.1*						Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.

31.2*						Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.

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

101						Interactive data files from Tilly’s, Inc.’s Quarterly Report on Form 10-Q for the quarter ended May 3, 2025, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) the Consolidated Balance Sheets; (ii) the Consolidated Statements of Operations; (iii) the Consolidated Statements of Comprehensive Loss; (iv) the Consolidated Statements of Stockholders’ Equity; (v) the Consolidated Statements of Cash Flows and (vi) Notes to the Consolidated Financial Statements.

104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


*			Filed herewith.


**			Furnished herewith and not “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
#			Management contract or compensatory plan

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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.


		Tilly’s, Inc.

Date:	June 5, 2025	/s/ Hezy Shaked
		Hezy Shaked
		Co-Founder, Executive Chairman, President and Chief Executive Officer
		(Principal Executive Officer)

Date:	June 5, 2025	/s/ Michael Henry
		Michael Henry
		Executive Vice President, Chief Financial Officer
		(Principal Financial Officer)

TILLY'S, INC. 10-Q