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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_________________________________________

FORM 10-Q

_________________________________________


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

For the quarterly period ended August 3, 2025


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

For the transition period from _______ to _______

Commission File Number 001-37641

_________________________________________

DULUTH HOLDINGS INC.

(Exact name of registrant as specified in its charter)

_________________________________________

	99
Wisconsin	39-1564801
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

201 East Front Street Mount Horeb, Wisconsin	53572
(Address of principal executive offices)	(Zip Code)

(608) 424-1544

(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 B Common Stock, No Par Value	DLTH	NASDAQ Global Select Market

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 þ No o

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

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	o	Accelerated Filer	o
Non-accelerated Filer	þ	Smaller Reporting Company	þ
		Emerging Growth Company	o

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. o

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

The number of shares outstanding of the Registrant’s Class A common stock, no par value, as of September 3, 2025, was 3,364,200.

The number of shares outstanding of the Registrant’s Class B common stock, no par value, as of September 3, 2025, was 33,327,578.

DULUTH HOLDINGS INC.

QUARTERLY REPORT ON FORM 10-Q

FOR QUARTER ENDED August 3, 2025

INDEX



	Part I—Financial Information	Page
Item 1.	Financial Statements	3
	Condensed Consolidated Balance Sheets as of August 3, 2025 and February 2, 2025 (Unaudited)	3
	Condensed Consolidated Statements of Operations for the three and six months ended August 3, 2025 and July 28, 2024 (Unaudited)	5
	Condensed Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended August 3, 2025 and July 28, 2024 (Unaudited)	6
	Condensed Consolidated Statement of Shareholders’ Equity for the three and six months ended August 3, 2025 (Unaudited)	7
	Condensed Consolidated Statement of Shareholders’ Equity for the three and six months ended July 28, 2024 (Unaudited)	8
	Condensed Consolidated Statements of Cash Flows for the six months ended August 3, 2025 and July 28, 2024 (Unaudited)	9
	Notes to Condensed Consolidated Financial Statements (Unaudited)	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	23
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	28
Item 4.	Controls and Procedures	28
	Part II—Other Information
Item 1.	Legal Proceedings	29
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	30

Signatures		31

‎

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

DULUTH HOLDINGS INC.

Condensed Consolidated Balance Sheets - Assets

(Unaudited)

(Amounts in thousands)


	August 3, 2025		February 2, 2025
ASSETS
Current Assets:
Cash and cash equivalents	$	5,738	$	3,335
Receivables		8,894		3,970
Income tax receivable		114		—
Inventory, less reserves of $3,716 and $2,135, respectively		148,051		166,545
Prepaid expenses & other current assets		23,135		17,781
Total current assets		185,932		191,631
Property and equipment, net		103,224		111,560
Operating lease right-of-use assets		97,361		102,663
Finance lease right-of-use assets, net		31,267		32,957
Available-for-sale security		4,834		4,491
Other assets, net		11,182		9,140
Total assets	$	433,800	$	452,442

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

‎

DULUTH HOLDINGS INC.

Condensed Consolidated Balance Sheets – Liabilities and Shareholders’ Equity

(Unaudited)

(Amounts in thousands)


	August 3, 2025		February 2, 2025
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Trade accounts payable	$	43,598	$	73,882
Accrued expenses and other current liabilities		33,257		35,684
Income taxes payable		—		65
Current portion of operating lease liabilities		16,147		15,534
Current portion of finance lease liabilities		2,616		2,541
Line of credit		32,457		—
Current maturities of TRI long-term debt		975		931
Total current liabilities		129,050		128,637
Operating lease liabilities, less current maturities		83,638		89,222
Finance lease liabilities, less current maturities		29,295		30,621
TRI long-term debt, less current maturities		23,821		24,283
Deferred tax liabilities		938		—
Total liabilities		266,742		272,763
Shareholders' equity:
Preferred stock, no par value; 10,000 shares authorized; no shares issued or outstanding as of August 3, 2025 and February 2, 2025		—		—
Common stock (Class A), no par value; 10,000 shares authorized; 3,364 shares issued and outstanding as of August 3, 2025 and February 2, 2025		—		—
Common stock (Class B), no par value; 200,000 shares authorized; 33,782 shares issued and 33,312 shares outstanding as of August 3, 2025 and 32,077 shares issued and 31,813 shares outstanding as of February 2, 2025		—		—
Treasury stock, at cost; 470 and 264 shares as of August 3, 2025 and February 2, 2025, respectively		(2,922)		(2,332)
Capital stock		109,499		108,009
Retained earnings		63,689		77,721
Accumulated other comprehensive loss		(272)		(722)
Total shareholders' equity of Duluth Holdings Inc.		169,994		182,676
Noncontrolling interest		(2,936)		(2,997)
Total shareholders' equity		167,058		179,679
Total liabilities and shareholders' equity	$	433,800	$	452,442

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

‎

DULUTH HOLDINGS INC.

Condensed Consolidated Statements of Operations

(Unaudited)

(Amounts in thousands, except per share figures)


	Three Months Ended				Six Months Ended
	August 3, 2025		July 28, 2024		August 3, 2025		July 28, 2024
Net sales	$	131,716	$	141,619	$	234,420	$	258,303
Cost of goods sold (excluding depreciation and amortization)		59,697		67,623		109,046		122,683
Gross profit		72,019		73,996		125,374		135,620
Selling, general and administrative expenses		68,767		73,997		134,474		144,592
Restructuring expense		850		1,596		850		1,596
Operating income (loss)		2,402		(1,597)		(9,950)		(10,568)
Interest expense		1,469		988		2,950		1,981
Other (loss) income, net		(82)		145		(243)		161
Income (loss) before income taxes		851		(2,440)		(13,143)		(12,388)
Income tax (benefit) expense		(442)		(470)		828		(2,553)
Net income (loss)		1,293		(1,970)		(13,971)		(9,835)
Less: Net income attributable to noncontrolling interest		32		11		61		19
Net income (loss) attributable to controlling interest	$	1,261	$	(1,981)	$	(14,032)	$	(9,854)
Basic earnings per share (Class A and Class B):
Weighted average shares of common stock outstanding		34,448		33,367		34,081		33,247
Net income (loss) per share attributable to controlling interest	$	0.04	$	(0.06)	$	(0.41)	$	(0.30)
Diluted earnings per share (Class A and Class B):
Weighted average shares and equivalents outstanding		34,656		33,367		34,081		33,247
Net income (loss) per share attributable to controlling interest	$	0.04	$	(0.06)	$	(0.41)	$	(0.30)

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

‎

DULUTH HOLDINGS INC.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

(Amounts in thousands)


	Three Months Ended				Six Months Ended
	August 3, 2025		July 28, 2024		August 3, 2025		July 28, 2024
Net income (loss)	$	1,293	$	(1,970)	$	(13,971)	$	(9,835)
Other comprehensive loss
Securities available-for sale:
Unrealized security gain (loss) arising during the period		28		128		450		(12)
Income tax expense (benefit)		—		32		—		(3)
Other comprehensive income (loss)		28		96		450		(9)
Comprehensive income (loss)		1,321		(1,874)		(13,521)		(9,844)
Comprehensive income attributable to noncontrolling interest		32		11		61		19
Comprehensive income (loss) attributable ‎to controlling interest	$	1,289	$	(1,885)	$	(13,582)	$	(9,863)

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

‎

DULUTH HOLDINGS INC.

Condensed Consolidated Statement of Shareholders’ Equity

(Unaudited)

(Amounts in thousands)


	Six Months Ended August 3, 2025
								Accumulated		Noncontrolling
	Capital stock							other		interest in		Total
				Treasury		Retained		comprehensive		variable interest		shareholders'
	Shares	Amount		stock		earnings		(loss) income		entity		equity
Balance at February 2, 2025	35,177	$	108,009	$	(2,332)	$	77,721	$	(722)	$	(2,997)	$	179,679
Issuance of common stock	766		66		—		—		—		—		66
Stock-based compensation	—		254		—		—		—		—		254
Restricted stock forfeitures	(567)		—		—		—		—		—		—
Restricted stock surrendered for taxes	(122)		—		(264)		—		—		—		(264)
Other comprehensive loss	—		—		—		—		422		—		422
Net (loss) income	—		—		—		(15,293)		—		29		(15,264)
Balance at May 4, 2025	35,254	$	108,329	$	(2,596)	$	62,428	$	(300)	$	(2,968)	$	164,893
Issuance of common stock	2,074		76		—		—		—		—		76
Stock-based compensation	—		1,094		—		—		—		—		1,094
Restricted stock forfeitures	(569)		—		—		—		—		—		—
Restricted stock surrendered for taxes	(83)		—		(326)		—		—		—		(326)
Other comprehensive income	—		—		—		—		28		—		28
Net income	—		—		—		1,261		—		32		1,293
Balance at August 3, 2025	36,676	$	109,499	$	(2,922)	$	63,689	$	(272)	$	(2,936)	$	167,058

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

‎

DULUTH HOLDINGS INC.

Condensed Consolidated Statement of Shareholders’ Equity

(Unaudited)

(Amounts in thousands)


	Six Months Ended July 28, 2024
								Accumulated		Noncontrolling
	Capital stock							other		interest in		Total
				Treasury		Retained		comprehensive		variable interest		shareholders'
	Shares	Amount		stock		earnings		loss		entity		equity
Balance at January 28, 2024	34,387	$	103,579	$	(1,738)	$	121,392	$	(427)	$	(3,056)	$	219,750
Issuance of common stock	782		110		—		—		—		—		110
Stock-based compensation	—		1,372		—		—		—		—		1,372
Restricted stock forfeitures	(15)		—		—		—		—		—		—
Restricted stock surrendered for taxes	(80)		—		(383)		—		—		—		(383)
Other comprehensive income	—		—		—		—		(105)		—		(105)
Net loss	—		—		—		(7,873)		—		8		(7,865)
Balance at April 28, 2024	35,074	$	105,061	$	(2,121)	$	113,519	$	(532)	$	(3,048)	$	212,879
Issuance of common stock	202		97		—		—		—		—		97
Stock-based compensation	—		1,011		—		—		—		—		1,011
Restricted stock forfeitures	(168)		—		—		—		—		—		—
Restricted stock surrendered for taxes	(29)		—		(122)		—		—		—		(122)
Other comprehensive income	—		—		—		—		96		—		96
Net loss	—		—		—		(1,981)		—		11		(1,970)
Balance at July 28, 2024	35,079	$	106,169	$	(2,243)	$	111,538	$	(436)	$	(3,037)	$	211,991

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

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DULUTH HOLDINGS INC.

Condensed Consolidated Statements of Cash Flows

(Unaudited)

(Amounts in thousands)


	Six Months Ended
	August 3, 2025		July 28, 2024
Cash flows from operating activities:
Net loss	$	(13,971)	$	(9,835)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization		13,294		16,297
Stock based compensation		1,348		2,383
Deferred income taxes		938		(4,077)
Loss on disposal of property and equipment		905		77
Changes in operating assets and liabilities:
Receivables		(4,924)		(2,363)
Income taxes receivable		(114)		304
Inventory		18,494		(42,961)
Prepaid expense & other current assets		(3,167)		130
Software hosting implementation costs, net		(4,103)		(3,406)
Trade accounts payable		(30,731)		26,623
Income taxes payable		(65)		—
Accrued expenses and deferred rent obligations		(2,495)		(1,570)
Other assets		(177)		(2)
Noncash lease impacts		332		1,348
Net cash used in operating activities		(24,436)		(17,052)
Cash flows from investing activities:
Purchases of property and equipment		(3,572)		(3,183)
Principal receipts from available-for-sale security		107		97
Net cash used in investing activities		(3,465)		(3,086)
Cash flows from financing activities:
Proceeds from line of credit		76,247		40,500
Payments on line of credit		(43,790)		(40,500)
Payments on TRI long term debt		(454)		(412)
Payments on finance lease obligations		(1,251)		(1,521)
Payments of tax withholding on vested restricted shares		(590)		(505)
Other		142		206
Net cash provided by (used in) financing activities		30,304		(2,232)
Increase (decrease) in cash and cash equivalents		2,403		(22,370)
Cash and cash equivalents at beginning of period		3,335		32,157
Cash and cash equivalents at end of period	$	5,738	$	9,787
Supplemental disclosure of cash flow information:
Interest paid	$	2,950	$	1,981
Income taxes paid	$	—	$	125
Supplemental disclosure of non-cash information:
Unpaid liability to acquire property and equipment	$	1,801	$	1,459

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

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DULUTH HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (Unaudited)

1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION

A. Nature of Operations

Duluth Holdings Inc. (“Duluth Trading” or the “Company”), a Wisconsin corporation, is a lifestyle brand of men’s and women’s casual wear, workwear and accessories sold primarily through the Company’s own omnichannel platform. The Company’s products are marketed under the Duluth Trading name, with the majority of products being exclusively developed and sold as Duluth Trading branded merchandise.

The Company identifies its operating segments according to how its business activities are managed and evaluated. The Company continues to report one reportable external segment, consistent with the Company’s omnichannel business approach. The Company’s revenues generated outside the United States were insignificant.

The Company has two classes of authorized common stock: Class A common stock and Class B common stock. The rights of holders of Class A common stock and Class B common stock are identical, except for voting and conversion rights. Each share of Class A common stock is entitled to ten votes per share and is convertible at any time into one share of Class B common stock. Each share of Class B common stock is entitled to one vote per share. The Company’s Class B common stock trades on the NASDAQ Global Select Market under the symbol “DLTH.”

B. Basis of Presentation

The condensed consolidated financial statements are prepared in accordance with U.S. Generally Accepted Accounting Principles (“U.S. GAAP”). The Company consolidates TRI Holdings, LLC (“TRI”) as a variable interest entity (see Note 6 “Variable Interest Entity” for further information). All significant intercompany balances and transactions have been eliminated in consolidation.

The Company’s fiscal year ends on the Sunday nearest to January 31 of the following year. Fiscal 2025 is a 52-week period and ends on February 1, 2026. Fiscal 2024 was a 53-week period and ended on February 2, 2025. The three and six months of fiscal 2025 and fiscal 2024 represent the Company’s 13-week and 26-week periods ended August 3, 2025 and July 28, 2024, respectively.

The accompanying condensed consolidated financial statements as of and for the three and six months ended August 3, 2025 and July 28, 2024 have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and, in the opinion of the Company, include all adjustments (which are normal and recurring in nature) necessary to present fairly the financial position, results of operations and cash flows of the Company for the interim periods presented. Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such SEC rules and regulations as of and for the three and six months ended August 3, 2025 and July 28, 2024. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in the Company’s annual report on Form 10-K for the fiscal year ended February 2, 2025.

C. Inventory

Inventory consists of finished goods stated at the lower of cost or net realizable value, with cost determined using the first-in, first-out valuation method. The Company records an inventory reserve for the anticipated loss associated with selling inventories below cost. Inventory reserve for excess and obsolete items was $3.7 million and $2.1 million as of August 3, 2025 and February 2, 2025, respectively.

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DULUTH HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (Unaudited)

D. Prepaid Expenses and Other Assets

Prepaid expenses and other assets consist of the following:


	August 3, 2025		February 2, 2025
(in thousands)
Prepaid expenses & other current assets
Pending returns inventory, net	$	1,894	$	2,301
Current software hosting implementation costs, net		4,708		3,749
Other prepaid expenses		16,533		11,731
Prepaid expenses & other current assets	$	23,135	$	17,781

Other assets, net
Intangible assets, net	$	406	$	414
Non-current software hosting implementation costs		9,415		7,498
Other assets, net		1,361		1,228
Other assets, net	$	11,182	$	9,140

E. Seasonality of Business

The Company’s business is affected by the pattern of seasonality common to most apparel businesses. Historically, the Company has recognized a significant portion of its revenue and operating profit in the fourth fiscal quarter of each year due to increased sales during the holiday season.

F. Cash and Cash Equivalents

The Company considers short-term investments with original maturities of three months or less when purchased to be cash equivalents. Amounts receivable from credit card issuers are typically converted to cash within 2 to 4 days of the original sales transaction and are considered to be cash equivalents.

G. Significant Accounting Policies

There have been no significant changes to the Company’s significant accounting policies as described in the Company’s Annual Report on Form 10-K for the year ended February 2, 2025.
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DULUTH HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (Unaudited)

2. LEASES

Based on the criteria set forth in ASC Topic 842, Leases (“ASC 842”), the Company recognizes right-of-use (ROU) assets and lease liabilities related to leases on the Company’s consolidated balance sheets. The Company determines if an arrangement is, or contains, a lease at inception. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities reflect the obligation to make lease payments arising from the lease. At any given time during the lease term, the lease liability represents the present value of the remaining lease payments and the ROU asset is measured at the amount of the lease liability, adjusted for pre-paid rent, unamortized initial direct costs and the remaining balance of lease incentives received. Both the lease ROU asset and liability are reduced to zero at the end of the lease.

The Company leases retail space under non-cancelable lease agreements, which expire on various dates through 2036. Substantially all of these arrangements are store leases. Store leases generally have initial lease terms ranging from five years to fifteen years with renewal options and rent escalation provisions. At the commencement of a lease, the Company includes only the initial lease term as the option to extend is not reasonably certain. The Company does not record leases with a lease term of 12 months or less on the Company’s consolidated balance sheets.

When calculating the lease liability on a discounted basis, the Company applies its estimated discount. The Company bases this discount on a collateralized interest rate as well as publicly available data for instruments with similar characteristics.

In addition to rent payments, leases for retail space contain payments for real estate taxes, insurance costs, common area maintenance, and utilities that are not fixed. The Company accounts for these costs as variable payments and does not include such costs as a lease component.

The expense components of the Company’s leases reflected on the Company’s consolidated statement of operations were as follows:


	Consolidated Statement	Three Months Ended				Six Months Ended
	of Operations	August 3, 2025		July 28, 2024		August 3, 2025		July 28, 2024
(in thousands)
Finance lease expenses
Amortization of right-of-use ‎assets	Selling, general and ‎administrative expenses	$	723	$	814	$	1,445	$	1,652
Interest on lease liabilities	Interest expense		362		398		730		807
Total finance lease expense		$	1,085	$	1,212	$	2,175	$	2,459
Operating lease expense	Selling, general and ‎administrative expenses	$	4,908	$	5,502	$	9,806	$	10,595
Amortization of build-to-suit ‎leases capital contribution	Selling, general and ‎administrative expenses		321		321		642		642
Variable lease expense	Selling, general and ‎administrative expenses		2,855		3,039		5,656		5,961
Total lease expense		$	9,169	$	10,074	$	18,279	$	19,657

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DULUTH HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Other information related to leases were as follows:


	Six Months Ended
	August 3, 2025		July 28, 2024
(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Financing cash flows from finance leases	$	1,251	$	1,521
Operating cash flows from finance leases	$	730	$	807
Operating cash flows from operating leases	$	9,873	$	10,565

Right-of-use assets obtained in exchange for lease liabilities:
Operating leases	$	2,689	$	-

Weighted-average remaining lease term (in years):
Finance leases		9		10
Operating leases		6		7

Weighted-average discount rate:
Finance leases		4.5%		4.5%
Operating leases		4.4%		4.2%

Future minimum lease payments under the non-cancellable leases are as follows as of August 3, 2025:


Fiscal year	Finance		Operating
(in thousands)
2025 (remainder of fiscal year)	$	1,991		10,080
2026		3,993		20,076
2027		3,993		18,773
2028		4,017		16,866
2029		4,217		14,346
Thereafter		20,997		34,081
Total future minimum lease payments	$	39,208	$	114,222
Less – Discount		(7,297)		(14,437)
Lease liability	$	31,911	$	99,785

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DULUTH HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (Unaudited)

3. DEBT AND CREDIT AGREEMENT

Debt consists of the following:


	August 3, 2025		February 2, 2025
(in thousands)
TRI Senior Secured Note	$	21,296	$	21,714
TRI Note		3,500		3,500
	$	24,796	$	25,214
Less: current maturities		975		931
TRI long-term debt	$	23,821	$	24,283

Duluth Line of credit	$	32,457	$	—
Less: current maturities		32,457		—
Duluth long-term debt	$	—	$	—

TRI Holdings, LLC

TRI entered into a senior secured note (“TRI Senior Secured Note”) with an original balance of $26.7 million. The TRI Senior Secured Note is scheduled to mature on October 15, 2038 and requires installment payments with an interest rate of 4.95%. See Note 6 “Variable Interest Entities” for further information.

TRI entered into a promissory note (“TRI Note”) with an original balance of $3.5 million. The TRI Note is scheduled to mature in November 2038 and requires annual interest payments at a rate of 3.05%, with a final balloon payment due in November 2038.

While the above notes are consolidated in accordance with ASC Topic 810, Consolidation, the Company is not the guarantor nor obligor of these notes.

Credit Agreement

On May 14, 2021, the Company entered into a credit agreement (the “Credit Agreement”), which was treated as a modification for accounting purposes. The Credit Agreement originally matured on May 14, 2026 and provided for borrowings of up to $150.0 million that were available under a revolving senior credit facility, with a $5.0 million sublimit for issuance of standby letters of credit, as well as a $10.0 million sublimit for swing line loans. At the Company’s option, the interest rate applicable to the revolving senior credit facility was a floating rate equal to: (i) the Bloomberg Short-Term Bank Yield Index rate (“BSBY”) plus the applicable rate of 1.25% to 2.00% determined based on the Company’s rent adjusted leverage ratio, or (ii) the base rate plus the applicable rate of 0.25% to 1.00% based on the Company’s rent adjusted leverage ratio. The Credit Agreement was secured by essentially all Company assets and required the Company to maintain compliance with certain financial and non-financial covenants, including a maximum rent adjusted leverage ratio and a minimum fixed charge coverage ratio as defined in the Credit Agreement.

On July 8, 2022, the Company entered into the First Amendment to the Credit Agreement (the “First Amendment”), which was treated as a modification for accounting purposes. The First Amendment amended the Credit Agreement in order to (i) increase the revolving commitment from $150.0 million to $200.0 million; (ii) extend the maturity date from May 14, 2026 to July 8, 2027; (iii) amend the pricing index to replace BSBY with the Term Secured Overnight Financing Rate; and (iv) reduce the commitment fee in some instances.

On January 31, 2025 the Company entered into the Second Amendment to the Credit Agreement (the “Second Amendment”). The Second Amendment amended the Credit Agreement, in part, to (i) decrease the revolving commitment from $200 million to $100 million; (ii) revise the definition of “Applicable Rate” to provide for pricing terms in the event of a Rent Adjusted Leverage Ratio greater than or equal to 3.50:1.0; (iii) limit the exceptions to the prohibition on restricted payments to (a) making dividends or distributions by any subsidiary to the Company, and (b) the acquisition of equity interests in satisfaction of tax withholding obligations associated with restricted stock or awards under employee incentive plans; and (iv) provide that the Maximum Rent Adjusted Leverage Ratio and the Minimum Fixed Charge Coverage Ratio will be measured commencing on the fiscal quarter ending May 2, 2021 and measured quarterly thereafter as of the last day of each fiscal quarter of the Company (other than for the fiscal quarter ending February 2, 2025). The reduction in the revolving commitment was intended to rightsize the credit facility with the Company’s cash needs to fund seasonal inventory builds and

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DULUTH HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (Unaudited)

capital expenditure expectations and resulted in fee savings. The Credit Agreement was extinguished on April 28, 2025, resulting in a write down of $0.2 million of debt issuance costs related to the terminated line of credit.

On April 28, 2025, the Company entered into a new credit agreement (the “New Credit Agreement”) among the Company, certain financial institutions as Lenders thereto, and BMO Bank N.A., as Administrative Agent, a Swing Line Lender and a Letter of Credit Issuer. The Credit Agreement provides for borrowings of up to $100.0 million in aggregate principal amount that are available under an asset-based revolving senior credit facility (the “Revolver”) with a $10.0 million sublimit for the issuance of standby letters of credit.

Under the New Credit Agreement, (i) each Secured Overnight Financing Rate (“SOFR”) loan will bear interest on the outstanding principal amount at a rate per annum equal to adjusted term SOFR plus 150 basis points; (ii) each base rate loan will bear interest on the outstanding principal amount from the applicable borrowing date at a rate per annum equal to the Base Rate (as defined in the New Credit Agreement) plus 50 basis points; (iii) each swing line loan will bear interest on the outstanding principal amount from the applicable borrowing date at a rate per annum equal to the base rate plus the applicable margin; and (iv) each other obligation will bear interest on the unpaid amount at a rate per annum equal to the base rate plus the applicable margin.

The Company is also permitted to voluntarily prepay the New Credit Agreement in whole or in part at any time, where borrowings bearing interest based on the base rate may be prepaid at any time without penalty and borrowings bearing interest based on SOFR may be prepaid, subject to payment of usual and customary breakage and redeployment costs. The revolver will mature on April 28, 2030. Pursuant to the New Credit Agreement, the Company may request an increase in the revolving credit commitments in the aggregate amount of up to $25 million during the term of the New Credit Agreement and with the consent of the Administrative Agent, subject to credit approval of the Lenders and the satisfaction of certain conditions. The New Credit Agreement contains customary events of default and financial, affirmative and negative covenants and is secured by a first-priority perfected security interest in substantially all of the tangible and intangible assets of the Company.

The new $100.0 million Revolver replaces the prior revolving credit facility at a lower interest rate and extends the availability of funds to April 28, 2030. The Company believes the New Credit Agreement will provide the Company with flexibility and liquidity to finance seasonal inventory builds.

On July 16, 2025, the Company entered into the First Amendment to the New Credit Agreement where all revolving credit loans advanced or prepaid pursuant to such Sweep to Loan Arrangement shall bear interest based on the Base Rate.

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DULUTH HOLDINGS INC.

Notes to Condensed Consolidated Financial Statements (Unaudited)

4. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

Accrued expenses and other current liabilities consist of the following:


	August 3, 2025		February 2, 2025
(in thousands)
Salaries and benefits	$	5,389	$	3,897
Deferred revenue		7,715		9,783
Freight		2,350		2,495
Product returns		3,984		4,568
Unpaid purchases of property & equipment		1,097		1,264
Accrued advertising		404		929
Other		12,318		12,748
Total accrued expenses and other current liabilities	$	33,257	$	35,684

5. FAIR VALUE

ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), defines fair value as the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date (i.e., an exit price). The exit price is based on the amount that the holder of the asset or liability would receive or need to pay in an actual transaction (or in a hypothetical transaction if an actual transaction does not exist) at the measurement date. ASC 820 describes a fair value hierarchy based on three levels of inputs that may be used to measure fair value, of which the first two are considered observable and the last unobservable, as follows:

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

Level 2 – Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or 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 that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The Company’s assets and liabilities measured at fair value are categorized as Level 3 instruments. The fair value of the Company’s available-for-sale security was valued based on a discounted cash flow method (Level 3), which incorporates the U.S. Treasury yield curve, credit information and an estimate of future cash flows. During the six months ended August 3, 2025, certain changes in the inputs did impact the fair value of the available-for-sale security. The calculated fair value is based on estimates that are subjective in nature and involve uncertainties and matters of significant judgement and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

The amortized cost and fair value of the Company’s available-for-sale security and the corresponding amount of gross unrealized gains and losses recognized in accumulated other comprehensive income are as follows:

August 3, 2025

Cost or

Gross

Amortized

Unrealized

DULUTH HOLDINGS INC. 10-Q