Earnings Call Transcript - ZUMZ Q2 2024

Operator, Operator

Good afternoon, ladies and gentlemen, and welcome to the Zumiez Inc. Second Quarter Fiscal 2024 Earnings Conference Call. At this time, all participants are in a listen-only mode. We will conduct a question-and-answer session towards the end of this conference. Before we begin, I'd like to remind everyone of the company's Safe Harbor language. Today's conference call includes comments concerning Zumiez Inc., business outlook and contains forward-looking statements. These forward-looking statements and all other statements that may be made on this call that are not based on historical facts are subject to risks and uncertainties. Actual results may differ materially. Additional information concerning a number of factors that could cause actual results to differ materially from the information that will be discussed is available in Zumiez filings with the SEC. At this time, I will turn the call over to Rick Brooks, Chief Executive Officer. Mr. Brooks?

Rick Brooks, CEO

Hello, everyone, and thank you for joining us on today's call. With me today is Chris Work, our Chief Financial Officer. I'll begin with a few remarks about our second quarter and the start of the back-to-school season before touching on our strategic priorities for 2024. Chris will then take you through the financials and our outlook for the balance of the year. We're happy to report that our business delivered a stronger-than-anticipated performance in the second quarter, exceeding our expectations and demonstrating the resilience of our brand and our customer base. Led by our North American region, total comparable sales inflected positively in June, increasing low-single-digits and strengthened as the back-to-school season got underway in July, up high-single-digits for the month. Total sales for the second quarter increased 8% year-over-year to $210 million, well above our guidance for sales between $199 million and $204 million. We're pleased with the results we achieved in the quarter as they reflect the contributions of multiple areas of our business. Our men's category continued its positive momentum, growing year-over-year for the third consecutive quarter at an accelerating pace. Our Women's category, which turned positive in Q1, accelerated meaningfully in the second quarter, posting strong double-digit growth versus a year ago while we also saw footwear turn positive. Our solid top-line performance resulted in noticeable leverage in the second quarter across our cost structure. At the same time, our heightened focus on driving full-price selling in Europe helped push merchandising margins higher than a year ago. This all fueled a significant increase in our bottom line with our loss per share improving to $0.04 compared to a loss of $0.44 per share last year, which is also meaningfully better than our guidance for a loss of $0.40 to $0.30 per share. As we transition to the third quarter, we've seen another step up in our business with comparable sales results up 12.1% quarter to date through September 2nd. While our teams have made significant progress, returning to positive comparable sales growth and improving profitability, we believe the business is capable of much more. As we continue to navigate a challenging retail environment, we will stay focused on the items that are within our control to grow sales and drive the business back towards its historical operating performance and beyond. As shared on our fourth quarter call in March, our focus continues to be the following strategies. First, we're concentrating on reinvigorating our top-line sales through investments to ensure that we continue to win with customers. Some of these initiatives include infusing our product assortments with fresh offerings. We launched more than 100 brands in 2022, more than 150 brands in 2023, and remain on track to launch a similar level in 2024. We're already seeing our newly launched brands from the past couple of years accounting for a larger portion of current sales than we've seen historically, indicating they're resonating well with customers. We're continuing to expand our private-label brand portfolio this year and expect to continue to grow private label share. Private label represented approximately 23% of sales in 2023, up from 18% in 2022, and 13% in 2021. This growth showcases our team's ability to capitalize on both trend and value-conscious consumers, providing another avenue for growth. And we're maintaining our best-in-class service in stores and online with continued investment in training and technology. Combined, these efforts aim to enhance our customer relationships and allow us to engage with them in more personalized and relevant ways. Along with these top-line initiatives, we are enhancing our focus on profitability, both in Europe and in North America. In Europe, our plan involves a pivot from our growth strategy. We have slowed store expansion this year and shifted focus to enhancing the productivity of our nearly 90 stores across nine countries and our pan-European web business that currently serves the European market. With a focus on full-price selling for our existing footprint, we believe we can unlock the potential for the business and create value as we work through what has been a difficult cycle in Europe. There's no doubt that trends emerge locally and grow globally, and our current penetration in the relevant markets is a significant advantage to Zumiez over the long term. Overall, we believe we can achieve profitability in Europe with this new focus as we've done in other international markets like Canada and Australia. Beyond Europe, we are focused on profitability in other markets as well. In 2023, we closed 20 underperforming North American stores and we remain on track to close approximately 25 additional underperforming locations in 2024. As a result, we decreased field and corporate staffing levels to align with the reduced store count. We are also further optimizing store labor through several initiatives, including adjustments to staffing models at lower-volume stores. We made structural changes to reduce shipping and logistics costs company-wide, reduced discount selling compared with last year's elevated levels, and continued to implement other cost-saving opportunities in many areas throughout the organization. Overall, these adjustments to our operating strategy, combined with our strong balance sheet with more than $125 million in cash, position us well to navigate the current environment and emerge a stronger and more profitable company. We're encouraged with how 2024 is unfolding thus far and feel that we are well-positioned to capitalize in the upcoming holiday season. Longer term, I believe that by staying true to our customer, our culture, and our brand, with an intense focus on our long-term strategies, we can continue capturing market share while generating increased value for our shareholders. With that, I'll turn the call over to Chris to discuss the financials.

Chris Work, CFO

Thanks, Rick, and good afternoon, everyone. I'm going to start with a review of our second quarter results. I'll then provide an update on our third quarter-to-date sales trends and some perspective on how we're thinking about the full year. Second quarter net sales were $210.2 million, up 8.1% from $194.4 million in the second quarter of 2023. Comparable sales increased 3.6% for the quarter. The shift in the retail calendar had a positive impact on our results, increasing net sales growth by approximately 530 basis points during the second quarter. The calendar shift will have a negative impact on the third-quarter net sales growth. Comparable sales results as reported are adjusted for the calendar shift and represent a more accurate measure of operating results. Our second quarter performance was driven by our North America business, which was positive for the second consecutive quarter. The strength was partially offset by a decline in international sales as we put greater emphasis on full-price selling in Europe, which benefited margins but pressured our top line. From a regional perspective, North America net sales were $176.3 million, an increase of 10.4% from 2023. Other international net sales, which consists of Europe and Australia, were $33.9 million, down 2.6% from last year. Excluding the impact of foreign currency translation, North America net sales increased 10.6% and other international net sales decreased 1.7% year-over-year. Comparable sales for North America were up 5.9% and comparable sales for other international were down 7.6% for the quarter. From a category perspective, men's was our largest positive comping category, followed by women's and then footwear. Hardgoods was our largest negative comping category, followed by accessories. The consolidated increase in comparable sales was driven by an increase in dollars per transaction, partially offset by a decrease in transactions. Dollars per transaction were up for the quarter, driven by an increase in average unit retail and an increase in units per transaction. Second quarter gross profit was $71.8 million compared to $61.7 million in the second quarter of last year. Gross profit as a percentage of sales was 34.2% for the quarter, compared to 31.7% for the second quarter of 2023. The 250-basis-point increase in gross margin was primarily driven by 140 basis points of leverage in-store occupancy costs, 90 basis points of leverage in shipping costs, and 20 basis points of leverage in distribution center costs, while product margin was flat to the prior year. SG&A expense was $72.2 million, or 34.4% of net sales in the second quarter compared to $72.2 million or 37.1% of net sales a year ago. The 280 basis point decrease in SG&A expenses as a percent of net sales resulted from the following: 100 basis points due to leverage of store wages on higher sales, 80 basis points of non-wage corporate cost leverage, 50 basis of leverage in non-wage store operating costs, 50 basis points benefit to the timing of employee training, and 20 basis points of leverage of corporate wages, offset by a 30 basis point increase in incentive costs. Operating loss in the second quarter of 2024 was $0.4 million, or 0.2% of net sales compared with an operating loss of $10.5 million, or 5.4% of net sales last year. Net loss for the second quarter was $0.8 million, or $0.04 per share. This compares to a net loss of $8.5 million, or $0.44 per share for the second quarter of 2023. Our effective tax rate for the second quarter of 2024 was 252.1% compared with an 8.5% benefit in the year-ago period. The increase in our effective tax rate was primarily due to the allocation of losses across the jurisdictions in which we operate. Turning to the balance sheet. The business ended the quarter in a strong financial position. We had cash in current marketable securities of $127 million as of August 3, 2024, compared to $140 million as of July 29, 2023. The $13 million decrease in cash and current marketable securities over the trailing 12 months was driven primarily by share repurchases of $19.4 million, and capital expenditures of $14.7 million, offset by $23.6 million in cash provided by operating activities. As of August 3, 2024, we have no debt on the balance sheet. During the second quarter, we purchased approximately 945,000 shares of our common stock for $19.4 million at an average price of $20.55 per share under the $25 million repurchase authorization approved on June 5, 2024. Third quarter to date, we have purchased an additional 220,000 shares of our common stock for $5.6 million, or $25.39 per share, completing the June 5 authorization. Cumulatively, this resulted in approximately 1.2 million shares purchased under the authorization at an average price of $21.47. This represented 5.7% of our outstanding stock at the time of the authorization. At this time, we have no open repurchase authorization. We ended the quarter with $158.8 million in inventory, up 1.3% compared with $156.7 million last year. On a constant currency basis, our inventory levels were up 2% from last year. Given the sales backdrop, we are happy with our ending inventory balance for the second quarter and expect to continue to bring in newness as we move into the important holiday selling season. Now to our third quarter to date results. Net sales for the 30-day period ended September 2, 2024, increased 6.8% compared to the 30-day period in the prior year ended August 28, 2023. As previously stated, the calendar shift will have a negative impact on net sales growth for the third quarter. Comparable sales for the 30-day period ended September 2, 2024, which are adjusted to remove the impact of the calendar shift, were up 12.1% from the comparable period in the prior year. From a regional perspective, net sales for our North America business for the 30-day period ended September 2, 2024, increased 7.8% compared to the 30-day period ended August 28, 2023, while our other international business decreased 0.9%. Excluding the impact of foreign currency translation, North America net sales for the 30-day period ended September 2, 2024, increased 8% from the prior year, while other international net sales decreased 2.1% compared with 2023. Comparable sales for North America increased 14.4% for the 30-day period ended September 2, 2024, compared to the same weeks in the prior year, while comparable sales for our other international business declined 4.2%. From a category perspective, men's was our largest positive comparable sales growth category, followed by our women's and then footwear. The accessories category was our largest decline in comparable sales, followed by hardgoods. The comparable sales increase was driven by an increase in dollars per transaction and an increase in transactions. Dollars per transaction increased for the 30-day period due to an increase in average unit retail and an increase in units per transaction. With respect to our outlook for the third quarter of fiscal 2024, I want to remind everyone that formulating our guidance involves some inherent uncertainty and complexity in estimating sales, product margin, and earnings growth given the variety of internal and external factors that impact our performance. We are anticipating total sales for the third quarter to be between $221 million and $225 million, or a 2% to 4% increase from the third quarter last year. As a reminder, the second quarter benefited from the calendar shift, which pulled one week of heavier back-to-school volume into the second quarter and out of the third quarter. Adjusting for this shift, we are estimating third-quarter sales growth to be between 7% and 9%. We expect that our third quarter 2024 product margins will be slightly positive. Consolidated operating income as a percent of sales for the third quarter is expected to be between 0.2% and 1.2%, and we anticipate earnings per share will be between a loss of $0.04 and income of $0.06 compared to a loss of $0.12 in the prior year. As we consider the full-year outlook, we still believe there to be uncertainty and volatility in the macro environment. Given this, we will refrain from giving specific annual financial guidance but do want to share our expectations for the full year. With the business turning positive in the second quarter and the strong back-to-school season nearing a close, we are seeing new trends in brands within our merchandise assortment resonating with customers. With our year-to-date results and our third-quarter guidance, we now believe sales growth for the year could be in the low single-digit range despite the anniversary of the 53rd week and store closures previously reported. After two years of difficult performance in product margin, we believe that with a more stable sales environment, we will grow product margin for the full year in fiscal 2024. With sales growth in 2024, we anticipate we'll leverage SG&A cost year-over-year beyond the benefit we'll receive of moving past the $41.1 million goodwill impairment charge we recorded in the fourth quarter of 2023. With the previously mentioned assumptions, we believe we will return to positive operating margins for the full year. While effective tax rates are likely to fluctuate significantly by quarter, we anticipate that our full-year effective tax rate will be roughly 60% in fiscal 2024. We are planning to open nine new stores this year, including three in North America, three in Europe, and three stores in Australia. This is down from 19 stores in 2023 and 32 stores in 2022 as we focus on optimizing our current footprint. We are planning to close approximately 25 stores in fiscal 2024 and most of our closures are in North America. The number of closures could go up or down depending on our operating results in each location as well as our ability to work with our landlord partners. We expect our capital expenditures for 2024 to be between $14 million and $16 million, compared to $20.4 million in fiscal 2023 and $25.6 million in 2022. The reduction is primarily due to fewer planned store openings. We expect that depreciation and amortization, excluding non-cash lease expense, will be approximately $23 million and consistent with the prior year, and we are currently projecting our diluted share count for the full year to be approximately 19.3 million shares. This includes the shares repurchased in the third quarter, which completed the open share repurchase authorized by the Board on June 5, 2024. No further authorizations are currently in place. With that operator, we'd like to open the call up for questions.

Operator, Operator

Thank you. We will now begin the question-and-answer session. Our first question comes from Mitch Kummetz from Seaport. Your line is open.

Mitch Kummetz, Analyst

Yes. Thanks for taking my questions. Rick, it sounds like the business really inflected well for back-to-school. I think you said in your prepared remarks July comp was up high singles, obviously, August is up double-digits. Can you just kind of walk us through, why was that? How much of that was the consumer showing up for events and you guys just taking advantage of that?

Rick Brooks, CEO

I appreciate the questions, Mitch. It's about the momentum in our business, and I want to emphasize that we've been experiencing steady quarter-over-quarter improvement for quite some time. This is a significant inflection point for us, driven by familiar themes we've discussed earlier this year. First, the strength of our private label business is substantial, particularly with trends in bottoms. Our sales teams provide value in stores without needing to lower prices. The bundling concepts have been crucial in delivering value to our customers. Additionally, the new brands we're launching are resonating well with customers. There's a noticeable shift in youth fashion, reminiscent of the late 90s and early 2000s, reflected in our bottoms, tops, and footwear. Our teams are well-prepared and effectively managing this trend, which is evident in the strong execution by our salespeople. This continues the trend of sequential improvement in our business that we've talked about for several quarters, as we identify new brands to drive us forward. I'm optimistic about the implications for the holiday season, as there's a fresh look for customers and a need to replenish wardrobes, and I believe we're effectively capitalizing on that.

Mitch Kummetz, Analyst

So Rick, you referenced the momentum in the business. We're now in September. October is a particularly kind of small month. Do you think you can hold that momentum through these, kind of this gap between back-to-school and holiday? Is that kind of what's embedded in the guide for the third quarter? And, Chris, unless I missed it, did you guys provide a comp guide for the third quarter? I know you provided a sales range and you kind of spoke to the growth adjusting for the calendar shift. But is there kind of an underlying comp assumption embedded in that range? And then again, Rick, just in terms of holding momentum through this sort of non-event period between back-to-school and holiday, how do you see that?

Rick Brooks, CEO

Let me start by saying that we expect to see quarter-to-quarter improvement in Q3 compared to Q2. I believe we will maintain that momentum. Now, I'll hand it over to Chris to discuss what's included in the guidance.

Chris Work, CFO

Sure. And from an overall guide, just to reiterate, we said $221 million to $225 million in sales, which works out to be about a 2% to 4% growth. But as we said, the third quarter is impacted by about $10 million. That's shifting out of Q3 into Q2. So Q2 was a benefit and Q3 was a detriment. So if you remove that and you're just kind of trying to line up the comp-to-comp dates, which we believe is probably the better way to look at the business, we're guiding to about 7% to 9% in total sales, which is slightly below what that run rate has been for us. I mean, we just reported August through Labor Day at a higher amount, but that being said, I think we've seen this here for a number of years at the peaks have just gotten stronger. So our expectations are that the business is still good, still a positive comp here for the remainder of the quarter, but not quite at the elevated levels we saw here during the busy back-to-school season.

Mitch Kummetz, Analyst

And then maybe last question for me, Rick, on the European business, I know that you're shifting your strategy there and you're not seeing quite the same comp performance that you are in North America right now. Is that mainly a function of the shift in strategy? Or is it a tougher macro? Are you not seeing the trends that are resonating in the U.S., translating overseas as much? Can you just maybe address that?

Rick Brooks, CEO

Sure, Mitch. I want to emphasize that the macro environment has definitely been challenging for the past few years, particularly in the North American marketplace. The European economy faces significant difficulties, especially in key markets like Germany, which is our largest market in Europe. It's clear that the macro conditions are tougher. However, regarding our business, we are observing local trends that have the potential to become global. We're noticing these trends emerging in our European operations as well. Our private label is performing strongly in Europe, which highlights that local to global trend. At the same time, we are focused on transforming our product buying approach there to create a more curated and differentiated assortment for the market. This may lead to a temporary decline in less profitable sales, as highlighted by Chris in his comments about Q2. Nonetheless, we anticipate margin improvements as a result. Therefore, we're navigating some trade-offs and working to adapt our business operations in Europe amid a challenging macro environment. That's the situation you're seeing in Europe right now, Mitch.

Mitch Kummetz, Analyst

All right. Thanks. Good luck.

Operator, Operator

Thank you. One moment for our next question. Our next question comes from the line of Corey Tarlowe from Jefferies. Your line is open.

Corey Tarlowe, Analyst

Great. Thanks. Rick, I just wanted to ask about the hardgoods category, if you could maybe unpack that for us a little bit. And also within the context of the business inflecting, how you think about hardgoods as a category for driving the overall halo effect for the rest of the business?

Rick Brooks, CEO

Thank you, Corey. Let me provide some additional insight into our Skate Hardgoods business. During the pandemic, like many segments, we saw a significant increase in volume in 2020, which was part of a trend that began in 2019. That trend had a notable rise around February 2019, but it made things more difficult in 2021, 2022, and 2023. Even with the stimulus spending in 2021, we faced challenges. We went from a peak in Skate Hardgoods sales in 2020 to, I think, Chris, one of the lowest points currently. The volume has suffered largely due to the rapid cycle we experienced that typically would have unfolded over several years. Today, we remain cautious about this category, but there are some positive indicators, particularly in Australia, where we’ve seen three or four months of good results. Canada has also been positive recently, though the U.S. and Europe are still facing difficulties. I would describe the situation in the U.S. and Europe as tough but showing signs of improvement. Over the months ahead, we hope to find the bottom of this trend in Skate Hardgoods, although it may be at a new low in terms of sales penetration. The key questions will be whether we see a significant rebound in sales or if it remains stable for a while. Our team has done an excellent job managing inventory during this cycle and collaborating with our partners. Historically, when Skate Hardgoods starts to recover, we tend to benefit from a positive ripple effect throughout the business, which has been lacking in the past three years. I'm optimistic that as we approach the bottom, we'll gain some traction, although I'm unsure about the timing of any recovery. The good news is that it can't get worse given the current low point, and when sales do improve, we should see some advantages from our strong position as a leading skateboard retailer globally.

Corey Tarlowe, Analyst

Very helpful. Just as a follow-up, any color about how you're thinking about promotionality in the back half specifically given there's five less selling days between Thanksgiving and Christmas?

Rick Brooks, CEO

I’d be happy to address that. It's clear that this back-to-school season was quite promotional, as it usually is, especially in comparison to other times. Retailers are being promotional both in physical stores and even more so online. There are variations in how different retailers are pricing their products across markets. Our approach is different. Even though the environment is highly promotional, we plan to deliver value to consumers without merely cutting prices. We continuously seek ways to reward our salespeople as we do this. When examining back-to-school performance, especially in the bottoms category, we may have some of the highest prices in the market, yet we've seen very strong results. This highlights our sales team's ability to create bundled packages, which include many private label products that improve our margins. This approach benefits everyone: consumers get value through bundling, and our business and shareholders benefit from maintaining our product margins. We will remain focused on being a full-price, full-margin retailer, which requires us to stay ahead of trends and offer new and fresh brands. This is why new brand launches are crucial. We anticipate the holiday season will also be promotional, which I always expect. The key is distinguishing ourselves in this environment to achieve a more profitable business that aligns with our brand positioning.

Corey Tarlowe, Analyst

Very clear. Thanks for all the color and best of luck.

Rick Brooks, CEO

Thank you.

Operator, Operator

One moment for our next question. Our next question will come from the line of Richard Magnusen from B. Riley. Your line is open.

Richard Magnusen, Analyst

Hello. Thank you for taking our call. My question is that, as the retailers continue to feel pressure from higher operating costs, including labor costs, what do you see there regarding competitors in your core space exiting the business?

Rick Brooks, CEO

So, again, make sure I understand the question, Richard. It's relative to higher operating costs around labor and the competitive pressure that's putting on for ourselves and other retailers?

Richard Magnusen, Analyst

Correct. It's the costs have gone up in general and labor has established a new higher level, and I don't think anyone expects it to go down anytime soon. But amid all these pressures, what do you see in your core space regarding competitors that could be leaving the business, or exiting the business?

Rick Brooks, CEO

You're right. We are dealing with significantly higher labor costs like other retailers, and this poses a major challenge. I'm particularly proud of our efforts in implementing new labor strategies focused on productivity, which is a global initiative, not just limited to the U.S. or North America but also in Europe and Australia. We are proactive in managing labor and assessing the mix of transactions and average unit retail in our business to understand how these factors influence labor management and store volumes. If we decide to invest in labor, we need to be strategic about where and why to ensure a good return on sales. This has been a struggle for us and for everyone else, and we are still in the early phases of addressing these challenges. As our business moves forward and recovers to our desired levels, we must find innovative ways to enhance our operating margins. Competitors vary, each with distinct store footprints which present unique challenges. In Europe, we see a greater opportunity for reduced competition due to the pressures faced, from labor costs to the overall macro environment. There have been numerous store closures among competitors in Europe, reflecting the difficult market conditions and increased labor expenses.

Richard Magnusen, Analyst

Thank you.

Operator, Operator

Thank you. One moment for our next question. Our next question will come from the line of Dylan Carden from William Blair. Your line is open.

Dylan Carden, Analyst

Yes. Thank you very much. I'm just curious kind of thinking through the guide. I mean we saw a really nice flow through from an operating margin standpoint upon a positive comp, a nice positive comp in the quarter, and the underlying comp seems to be improving even further still in the third quarter. Why we wouldn't expect kind of a similar level of flow through the third quarter and kind of for the balance of the year?

Chris Work, CFO

Yes, the calendar shift will definitely impact this. The $10 million that moved from Q3 to Q2 has a significant effect on our bottom line, estimated to be around $0.09 or $0.10. We acknowledged that it benefited the second quarter. Even without this adjustment, the loss in the second quarter improved from $0.44 to $0.04, which indicates a good flow through, as you noted. We're pleased with this aspect. Looking ahead to the third quarter, we anticipate continued flow through, and we are focused on growing product margin, with positive movement in our gross margin related to occupancy and shipping as we boost sales. On the corporate side, we're seeing leverage across the P&L with the exception of incentives, which we plan to address after experiencing limited incentive payouts in recent years. Our current results suggest we will offer some level of incentives, which is included in our guidance. Therefore, when reviewing the year-to-date performance, you will observe a strong flow through, despite minor fluctuations between the second and third quarters.

Dylan Carden, Analyst

Thank you for your question. Regarding store closures, I'd like to address two aspects. First, can you provide any quantifiable margin impact from the stores closed over the past two years, specifically those close to 50? Additionally, as you consider the future of the U.S. fleet, do you expect to maintain this current level? It seems this might be a year to reassess those comparisons to achieve positive results. I'm also curious about how you view the differences between underperforming and outperforming stores, and your thoughts on the optimal size of the U.S. fleet in relation to sales volume. Thank you.

Chris Work, CFO

Sure, thanks for the question. This has been a year of some acceleration in closures for us as we move from 2023 into 2024. Historically, we've closed some select locations, often due to repositioning or because they were low-volume centers that weren't needed in the market. Over the last couple of years, we've seen an increase in this activity. In terms of margin impact, last year we had 21 stores that generated about $10 million in sales, which gives you an idea of the annual effect with very little impact on the bottom line. These stores generally make little to no return and don’t justify the corporate expenses assigned to them. We are focused on managing our fleet effectively. You can expect a similar situation with the closures we mentioned for 2024. It's essential for us to consider a variety of factors when evaluating stores, such as profitability and sales for each location, their impact on the trade area, the condition of the centers, and the landlords involved. Some centers may not be sustainable given their occupancy and competition in the area. We also assess peak performance and the potential to restore operations at these stores, as well as other factors affecting store economics. This year, we are looking at around 25 stores to continue managing these aspects. If we achieve our desired sales growth, that number could decrease or increase based on how we handle each open location.

Dylan Carden, Analyst

Really appreciate it. Thank you. Nice work.

Operator, Operator

Thank you. And with that, this concludes the question-and-answer session. I would now like to turn it back over to Rick for any closing remarks.

Rick Brooks, CEO

All right. I just want to, as always, offer my thanks, everyone, for your interest in Zumiez. And we'll look forward to getting back to you in early December with Q3 results. So thank you, everybody. Much appreciated.

Operator, Operator

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.