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My name is Jael and I will be your conference operator today. At this time, I would like to welcome everyone to the Jael's fourth quarter 2025 earnings All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number 1 on your telephone keypad. If you would like to withdraw your question, simply press star 1 again. Thank you. Before we begin, I need to remind you that certain comments made during these remarks may constitute forward-looking statements and are made pursuant to and within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 as amended. Such forward-looking statements are subject to both known and unknown risks and uncertainties that could cause actual results to differ materially from such statements. Those risks and uncertainties are described in the press release and JGIL's SEC filings. The forward-looking statements made on this recording are as of March 31st, 2026, and J. Jill does not undertake any obligation to update these forward-looking statements. Finally, J. Jill may refer to certain adjusted non-GAAP financial measures during these remarks. A reconciliation schedule showing the GAAP versus non-GAAP financial measures is available in the press release issued March 31st, 2026.

If you do not have a copy of today's press release, you may obtain one by visiting the investor relations page on the website at jjill.com I would now like to extend the conference over to Mary Ellen Coyne chief executive officer and president of JJILL you may begin good morning everyone and thank you for joining us today 2025 marks the beginning of a strategic evolution for JJILL we embarked on a period of testing and learning in order to build a strong foundation for our business by expanding our customer file through product evolution, enhancing the customer journey, and improving the way we work as an organization. While we delivered fourth quarter results that exceeded the updated guidance we provided in January, the period reinforced why this evolution is essential. We had an early assortment that did not resonate as hoped. We came up against earlier and deeper competitive holiday promotions and we watched our direct customer continue to migrate toward the promotional end of the spectrum, seeking value and discounts rather than engaging at full price. Against this backdrop, our teams remained agile and reacted in season to ensure we ended the period with inventories in a clean position as we enter 2026 we are taking the steps to transition and position the business for long-term growth to achieve our objectives we must expand our customer files this requires patience and precision we're expanding into new categories and modernizing our aesthetic to appeal to a broader customer base, but doing so in a way that upholds the quality, fit, and values that our loyal customers expect and trust from J. Jill. That's why our test and learn methodology is so critical. It allows us to validate new concepts with both new and existing customers before scaling, ensuring we're building sustainable growth rather than simply pursuing short-term gains. As we move through 2026 and beyond, you'll see us continue this balanced approach, and we believe the investment and strategic shifts we are making will position us well to achieve our objectives. This evolution will take time, and we should not expect the path But we are committed to maintaining a disciplined operating model, carefully managing expenses, and leveraging our strong financial position and strength and balance sheet as we pursue this course. None of this transformation would be possible without a best-in-class team, a combination of strong internal leaders with deep knowledge of J. Jill and outside leaders bringing relevant experience and new perspectives. Throughout 2025, we've made deliberate decisions to strengthen our leadership bench by recruiting proven talent with deep expertise in brand transformation. We brought Courtney O'Connor on board in July as Chief Merchandising Officer to support our product evolution, and Viv Redkey in November as the company's first ever chief growth officer to lead our e-commerce and AI initiatives. As we grow, we will continue investing in talent that complements our existing strengths and supports new capabilities. Turning now to our three key strategic pillars. First, evolving the product. In 2025, we analyzed our assortment and identified areas in which we needed to streamline, remove redundancy and evolve to capture a greater share of our customers' wardrobe. We began testing categories and concepts to expand the relevance of our product assortments. In Q4, for example, we successfully tested small capsules in areas where we saw potential but wanted to validate customer response before making larger commitments. We also piloted a localized merchandising strategy, adjusting our assortments to better reflect the lifestyle needs of specific markets. What became clear through those tests is that when we gave our customer the newness she wanted, she responded, even in a highly challenging promotional environment. These learning shapes how we approach our 2026 assortments and are informing our broader merchandising strategy going forward. As a reminder, our summer 2026 assortments, which we'll be introducing Q2, will capture the first influence from our strengthened merchant and design team. And we expect continued improvement in assortments as we move throughout the year. There will be more newness with silhouettes and fabrics, as well as the beginning stages of expansion into areas of accessories such as bags and belts. Our goal is to continue to provide our loyal customer the quality and value she knows and loves us for, while introducing relevant and compelling products focused on the new customers who we aim to attract. Second pillar is enhancing the customer journey. This past fall, we began to look at our marketing strategy differently and how we think about customer acquisition and engagement. Historically, our marketing spend has been disproportionately focused on our existing customer base. And while customer retention remains important, we know this approach was limiting our ability to expand our customer file and drive the kind of growth we're targeting. In 2026 and beyond, we plan to continue to rebalance our marketing investments to address the top of the funnel, building broader brand awareness and capturing new customers who may not yet be familiar with J. Jill. We believe these awareness-building initiatives will help us reach a larger, more diverse audience. Our third pillar is operational improvement. Throughout 2025, we focused on strengthening our operational capabilities and leveraging new technologies that we expect to support future growth. We successfully implemented our new OMS system, providing us with a more modern platform and created the chief growth officer role to fully maximize e-commerce and AI to help drive long-term success. As an organization, we are embracing the capabilities and efficiencies that AI can enable. With every potential use case, we ask ourselves, will it increase revenue? will it increase efficiency and will it drive speed to market as we begin 2026 we are introducing several new tools across the organization and have kicked off a significant project the implementation of a new merchandise planning and allocation tool from anaplan we plan to leverage this predictive ai-powered forecasting model to optimize how we plan and allocate inventory across the business thanks to the hard work of our team we are on track to go live late in the second half of 2026 with meaningful benefits expected to begin in 2027 and we will continue to improve as the system learns and we scale it to drive better demand forecasting smarter allocation by location and reduced markdowns as we look forward to 2026 we are confident in our strategic direction while being realistic about the current consumer environment the impact of tariffs and the work ahead while the quarter has seen a challenging start largely driven by continued price sensitivity particularly in our direct channel we are encouraged by the performance in our stores, supported by trained associates providing personalized guidance and tactile experiences that excite both existing and new customers around the brand's product evolution. Importantly, we are taking key learnings from these first few weeks of the year to inform our go-forward plans all of which is reflected in our outlook which mark will review in closing we're viewing 2026 as a period of deliberate accelerated change to expand our customer file while maintaining our operational discipline we remain committed to our methodical test and learn approach building on validated successes around new initiatives before scaling investments i am confident that this

measured approach combined with our strong balance sheet and operational rigor will position us to achieve our objectives and deliver long-term shareholder value and with that i'll turn it over to mark thank you mary ellen and good morning everyone as mary ellen outlined 2025 marked the beginning of a strategic evolution for J. Jill, a deliberate period of evaluation, testing, and learning that began to build the foundation for expanding our customer file. As we enter 2026, we are deploying these learnings, which while we expect will take some time to fully take hold, we are confident will position the business well for long-term sustainable growth. Before discussing our 2026 outlook, let me provide context on fiscal 2025, which demonstrated the resilience of our operating model even as we began this evolution and despite significant external – We generated $23.2 million in free cash flow in the year, maintained a solid gross margin rate of 68.7% despite incurring approximately $7.5 million of incremental net tariff costs for net new stores, successfully upgraded our order management system, and delivered adjusted EBITDA of $84.3 million on sales of $596.5 million. We also strengthened the balance sheet and returned significant capital to shareholders. We refinanced our $75 million term loan, which will save approximately $2 million in annualized cash. We repurchased $10.4 million, or about 638,000 shares, of J. Jill stock and paid approximately $5 million in ordinary dividends, demonstrating our ongoing commitment. These results reflect the operational discipline and agility of our organization in navigating a complex environment. The tariff policy enacted in April created unprecedented operational complexity, and we experienced a slowdown in our customer shopping behavior throughout the year, contributing to a 3% decline in comparable sales for the year. I want to thank our vendor partners for their support amidst these challenges and recognize and thank our cross-functional teams for their agility and resilience, adapting their work and processes in response to the changing business requirements. Many of these same team members managed the successful March 2025 cutover to our new OMS system, a major modernization of our technology foundation. As we move into 2026, we are planning for a year of strategic investment and measured transition. We're building the foundation for sustainable, profitable growth by expanding our customer file, modernizing our product offering, and further strengthening our operational capabilities. This requires deliberate investments that will pressure near-term profitability, but position us for stronger performance in 2027 and beyond. Our financial approach doesn't change. We're being disciplined about where we invest, measuring returns carefully, and maintaining financial flexibility to adjust as we learn. Our strong balance sheet and cash position provide flexibility to execute this strategic evolution while continuing to return capital to shareholders. With that context, let me walk through our fourth quarter performance and then provide our outlook for fiscal 2026. Total company sales for the quarter were $138.4 million, down 3.1% compared to Q4 of 2024. Total company comparable sales for the fourth quarter decreased 4.8%, driven by the retail channel. Store sales for Q4 were down 9% versus Q4 2024, driven by soft traffic and conversion, which were partially offset by stronger average unit retails and average transaction values in the quarter. Net new stores contributed approximately $2 million in revenue. Direct sales as a percentage of total sales were 53.5% in the quarter, Compared to the fourth quarter of fiscal 2024, direct sales were up 2.6%, driven by markdown sales, which benefited from ship-from-store capabilities. Q4 total company gross profit was $87.3 million, compared to $94.8 million last year. Q4 gross margin was 63.1%, down 320 basis points versus Q4 2024, driven by approximately $4.5 million of net tariff costs incurred during the quarter and deeper year-over-year discounting amidst a very competitive promotional environment. These headwinds were partially offset by favorable freight costs this year compared to last. SG&A expenses for the quarter were about $87 million compared to $89.3 million last year, as increased selling expense and G&A overhead were more than offset by lower marketing, management incentive, non-recurring costs, and stock-based compensation. Adjusted EBITDA was $7.2 million in the quarter, compared to $14.5 million in Q4 2024. Interest expense was $2.2 million in Q4, down about $500,000 compared to last year, driven by the term loan refinance completed in December. Adjusted net income per diluted share in Q4 2025 was a loss of $0.02 per share, compared to earnings of $0.32 per share in Q4 2024. Average weighted diluted share count in Q4 this year of 15.3 million shares reflected the impact of repurchasing 637.7 thousand shares. Please refer to today's press release for reconciliations of non-GAAP financial measures to their most comparable GAAP financial measures. adjusted EBITDA, adjusted net income, and adjusted net income per diluted share to net income and free cash flow to cash. Turning to cash, we ended the quarter and full year with $41 million of cash. For fiscal 2025, we generated $42.1 million of cash from operations and $23.2 million of free operations. We refinanced our $75 million term loan in December, extending the term through December of 2030 and saving approximately $2 million in annual. The regular quarterly cash dividends totaling $5 million and approximately $10.4 million of share repurchases in 2025 were funded from cash. As of January 31, 2026, there was $14.1 million of availability remaining under the stock repurchase authorization that expires in December 2026. Looking at inventory, at the end of the fourth quarter, total inventory excluding the impact of tariffs was about flat compared to the end of fourth quarter last year, including Getting approximately $9 million related to net tariff costs, reported inventory at end of Q4 was up 14% compared to end of Q4. Capital expenditures for the quarter were $10.1 million. Total capital expenditures for full year 2025 were $18.9 million, focused on new store openings and the OMS project store count. We opened seven stores in the fourth quarter with no closures. We ended the year with 256 stores, a net increase of four for the year as nine new store openings were offset, turning to our expectations for fiscal 2026. As mentioned, we expect 2026 will be a year of deliberate investment. Our guidance reflects this, along with the continued uncertainty in the consumer and geopolitical environment, the turbulent trade policy landscape, and the expectation that that it will take some time for new customers to respond to our evolving product assortments. As Mary Ellen mentioned, and as is reflected in our first quarter guidance, we have seen a stopter start to Q1. We expect this performance to gradually improve in second quarter as the new assortments hit in their entirety for the first time, before gaining incremental momentum as we move into the second half. Further, our guidance assumes tariffs incurred and paid for products landed before February 28, 2026. As a reminder, these tariffs were an average rate of approximately 20% and net of vendor offsets are expected to result in about $5 million of added cost of goods sold. Going forward, we are now assuming 10% tariffs than $1 million in net of vendor offsets in $20 million, $1.5 million. Our assumptions related to tariff rates are all subject to any additional changes the U.S. may enact to go further. Our guidance does not assume receipt. For the first quarter of fiscal 2026, we expect sales to be down approximately 5% to 7% compared to last year. with total company comp sales down approximately 7% to 9%. We expect adjusted EBITDA to be in the range of $15 to $17 million, reflecting approximately $5 million of tariff. For Q1, we expect gross margin to be down about 400 basis points compared to Q1 2025 as the annualized impacts of tariffs is incurred and product and marketing strategies are still evolving. While a quarter is off to a challenging start, as discussed, we are seeing relatively better performance quarter to date in our retail channel. For full year fiscal 2026, we expect sales to be down 2% to about flat compared to last year, total company comp sales to be in the range of down 3% to down 1%, and adjusted EBITDA of $70 to $75 million. dollars. This guidance assumes full year gross margins down about 50 basis points compared to 2025 as we expect headwinds related to tariffs in the first half to be partially offset by better full price selling, lower promotions, and lower year-over-year tariffs beginning in Q4. Regarding inventory, we will continue to take a prudent approach to inventory investments given in the relative uncertainty we have discussed, with unit purchases positioned down in the mid-single digits. Regarding store count, we continue to see opportunity to expand, but remain disciplined in our approach amidst our brand evolution. We are pleased with the performance of new stores open to date and expect to grow net store count by about five stores by the end of fiscal 2020. Of our planned openings, approximately half are in re-entry markets. We expect re-entry stores to ramp very quickly given the customer reception. New markets are in new markets to experience about a three to five year ramp to maturity. New stores represent an attractive investment opportunity, and we are excited to continue to expand our footprint. With respect to total capital expenditures, we expect to spend about $25 million in planning and allocation system that is projected to be complete. Regarding free cash flow, we expect, and finally, that our board of directors approved a $0.09 dividend, reflecting a $0.01 or 12.5% of record as we have $14 million remaining on our care repurchase program, which is authorized through December 2026. It is important to note that given the timing of year-end and Q4 earnings announcements, our Q1 repurchase window tends to be shorter than other windows during the year. In summary, we believe we are making the adjustments necessary to position the business versus confident in modernization and evolution of our product and marketing efforts, the appeal and awareness of our – and we believe the investments we are making and our front-end and P&A platforms will position us well and provide benefits into fiscal 2027 and beyond, all while continuing with our commitments to our ordinary dividend program and shall now hand it back to the operator for questions.

Thank you. The floor is now open for questions. If you have dialed in and would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star 1 again. If you're called upon to ask a question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. And we do request for today's session that you please lend yourself to one question and one follow-up. Your first question comes from a line of Jonah Kim, FTD Cowan. Your line is open.

Thank you for taking my question. Your customers are more sensitive to macro. How would you assess how much of the softness you're seeing in the first quarter is due to macro versus other factors would love any color there and then second question how will this year's Mother's Day differ from last year what are key products and marketing changes ahead of the Mother's Day thank you good morning Jonah thanks for your question so you know we we're at the start of a very deliberate evolution that being said we do believe that Q1 which had a challenging start was amidst a very tough macro backdrop, and we've talked about this consumer being impacted by that. We absolutely see that more in our direct channel, which is a continuation from what we saw in Q4. What is very encouraging to us is what we are seeing in stores with our talented store teams able to engage to have convert new customers and existing customers but we do believe that the macro environment had an impact in this quarter for sure with respect to Mother's Day the marketing team has exciting initiatives in play we are really focused on the timing of when we're launching our catalog when we are launching digital marketing um there's a whole program around it that we're

super excited about all backed up by a product drop that is coming in you know the 10 days before your next question comes from line of dana telsey of telsey group your line is open hi good morning everyone a lot of work underway as you think about the product assortment and the test and learn that you've put in place. What is changing? Bottoms, tops, sweaters, style, look, prints, patterns. What is changing and what do you expect to see and when will the new full assortment be there? And then with the customer acquisition strategies, who do you want to capture now that's different than your old customer? And as you think of the balance of the business, How much should be new versus existing customers go forward? And then lastly, Mark, just on the components and margins, what are you seeing from energy prices and the impact of freight costs? Thank you.

Good morning, Dana. I'll start with the first question, which is what is changing in the assortment? So we are taking this time to really test and learn. coming out of Q4 going into Q1, and what we are focused on is both new and existing customers achieving more of her wardrobe. We are moving with what we're calling a more modern aesthetic, which is really addressing her lifestyle, and that lifestyle will be built with core things that she has known and loved from the J. Jill brand for years, accentuated by newness, and we see her really responding to newness, but it's how we give her versatile wardrobing pieces that take her through every aspect of her day and her life. We see it being a very balanced approach, both in product and in marketing, with everything we do, really benefiting the three customer segments that you referred to, right? So as we think about customers, we are focused on retaining the customers we have, we are focused on attracting new, and we are focused on reactivating people who have not shopped the brand recently. When we think about this customer segment, we love this customer segment. She's loyal. She's responsive. She has money and time to spend on herself. When we look at the segment today, 45 to 65 is our target audience. Today, our customer sits at the higher end of that, and we know we have tremendous opportunity to target the middle of that range change and bring very qualified women into this audience.

And with respect to the gross margin, Dana, as we discussed on the last question, the macro environment is evolving quite real time. What we've included in our guidance is anything that we have in environment, we've seen some momentary spikes here and there, but it seems to be normalizing itself fairly quickly. And so right now what we're seeing is more flat ocean container rates, maybe up a tiny bit that we would have factored in. The small freight carriers.

You know, reiterate, while we know we have a great customer, we also know the number one priority for our site about some of the testing that we've done with performance indicators that are encouraging as we move forward.

Thank you.

Your next question comes from the line of Corey Tarlow of Jefferies. Your line is open.

Thanks, and good morning. Can you talk a little bit about trends by month and any color on what you're seeing quarter Thanks so much.

Yeah, Corey, it's Mark. With respect to Q4, we mentioned overall it was a pretty promotional quarter. It was markdown driven, particularly in the direct channel. The months themselves, January was the strongest, and it was sequentially better than December, better than November. I think we messaged some of that in some of our inter-quarter. The January performance was heavily sale. It's a sale period. It was heavily markdown-driven as well. So, you know, the cadence was, as I mentioned, but with a – And then I would say quarter to date, we've seen a challenging start. We mentioned that and are very much in line with how we've guided the quarter overall through this learning period to manage our inventory as an effort.

Understood. And then I think you had mentioned a new merchandise planning system. I know that there have been other initiatives that you've undertaken, whether it was the OMS project or other items. Can you talk a little bit about the benefits of this, what the costs are, and then how we should think about other incremental projects that are coming in this year, which I think you called an investment year.

We're so excited about the MP&A project through ANAPLAN. It will allow us to take what is today a very manual Excel-based system and move it to predictive AI forecasting, which will allow us to have inventory optimized in the right location in the right depth at the right time so we're very excited about what this means from a customer service you know customer experience because the inventory will be where they need it but also from a revenue and margin driving initiative and Corey the OMS one of the great advantages of the OMS project was taking

a very old to be leveraging the newer platform to with respect to the investments this year continue to be new stores we mentioned we're opening a targeted project allows us within the capital guide that we provide great thanks so much best of luck your next question comes

from line of dylan carden of william blair your line is open hi this is ann elvin scott on for dylan carden thanks so much for taking our question um so the guide implies a softer first quarter with improvement as the year progresses, which I believe is a similar setup to this time last year. What would you say is different this year versus last year that gives you the confidence in the back half inflection and how much of that outlook depends on macro stabilization or improvement?

So I'll start – good morning and thank you for the question. As we're entering 2026, we are in a period of evolution, and we are testing and learning every day. What I would say is we are sitting today with an incredibly talented team who are aligned on our vision and are committed to our journey. So, as we move forward, we will see product improvements through Q2, 3, 4. We will see learnings from our marketing initiatives that we're testing, where we are rebalancing spend, where we are trying new things, and moving forward, we'll see that growth as we lean into the things that are working, and equally as we pull away from those tests that don't.

Got it. That makes sense. Thank you. Oh, sorry, go ahead.

Sorry, I was just going to add on with respect to the Q4, it's, as Mary Ellen mentioned, the new assortments in Q1, and we're also in that period of Q4.

Understood. And then on pricing, do you guys see additional opportunity for targeted price increases in 2026? Is this reflective in the current guide, or is the current consumer environment a more cautious approach?

We will be taking a very measured approach to pricing. As we've said in our remarks, you know, we have seen the overall consumer and specifically on our direct channel be more price sensitive. We're seeing incredible promotion out there in the market. So we will be very measured about any increases we take in price.

Understood. Thank you.

And your next question comes from the line of Janine Stichter of BTIG. Your line is open.

You've got Ethan Sagge on for Janine. Thanks for taking our questions. Can you just provide some more color on which categories performed well and which may have lagged in Q4 and Q4 to date?

What we saw was that newness and novelty were driving the business, so where we had repeat programs from a year prior or two years prior, they were very soft. We also saw success in some of the tests we had out there. We saw success in our travel capsule. We saw success in expanded categories in outerwear. We saw the start of accessories, which has really moved into Q1 as a success story. And we tested some price points, particularly in sweaters with cashmere and saw success. As we moved into Q1, we are seeing newness resounding, we are – but again, Q1 is not indicative of our true product evolution. Where we really see that evolution is in Q2, where newness in fabric and silhouette and category mix really starts to evolve based on our learnings, clearly with the goal to drag full price selling in both channels because we know that we've really seen the retail channel working. We've seen things like our dress business turn around. It's exciting to see what's happening there.

Got it. That's helpful. I'll pass it on.

With no further questions, that concludes our Q&A session and also concludes today's conference call. Thank you for your participation. You may now disconnect.