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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended August 31, 2025

☐ 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: 001-14669

HELEN OF TROY LIMITED

(Exact name of registrant as specified in its charter)


Bermuda						74-2692550
(State or other jurisdiction						(I.R.S. Employer
of incorporation or organization)						Identification No.)

Clarendon House

2 Church Street

Hamilton HM 11, Bermuda

(Address of principal executive offices)

201 E. Main Street, Suite 300

El Paso, Texas 79901

(Registrant’s United States Mailing Address) (Zip Code)

(915) 225-8000

(Registrant’s telephone number, including area code)

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

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Shares, $0.10 par value per share

HELE

The NASDAQ Stock Market LLC

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

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

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

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

As of September 30, 2025, there were 23,028,819 common shares, $0.10 par value per share, outstanding.

Table of Contents

HELEN OF TROY LIMITED AND SUBSIDIARIES

FORM 10-Q

TABLE OF CONTENTS


		PAGE

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements	2

	Note 1 - Basis of Presentation and Related Information	7
	Note 2 - New Accounting Pronouncements	8
	Note 3 - Accrued Expenses and Other Current Liabilities	9
	Note 4 - Acquisition of Olive & June	9
	Note 5 - Goodwill and Intangibles	10
	Note 6 - Share-Based Compensation Plans	13
	Note 7 - Repurchases of Common Stock	14
	Note 8 - Restructuring Plan	14
	Note 9 - Commitments and Contingencies	15
	Note 10 - Long-Term Debt	16
	Note 11 - Fair Value	18
	Note 12 - Financial Instruments and Risk Management	21
	Note 13 - Accumulated Other Comprehensive Income (Loss)	24
	Note 14 - Segment and Geographic Information	24
	Note 15 - Income Taxes	27
	Note 16 - Earnings Per Share	28



Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	30

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	63

Item 4.	Controls and Procedures	63

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	63

Item 1A.	Risk Factors	63

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	64

Item 5.	Other Information	64

Item 6.	Exhibits	65

SIGNATURES		66

Table of Contents

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

HELEN OF TROY LIMITED AND SUBSIDIARIES

Condensed Consolidated Balance Sheets (Unaudited)


(in thousands, except shares and par value)	August 31, 2025		February 28, 2025
Assets
Assets, current:
Cash and cash equivalents	$	22,370	$	18,867
Receivables, less allowances of $4,624 and $4,294	350,231		428,330
Inventory	528,893		452,615
Prepaid expenses and other current assets	29,772		26,102
Income taxes receivable	6,863		5,798

Total assets, current	938,129		931,712

Property and equipment, net of accumulated depreciation of $216,206 and $200,176	335,644		330,029
Goodwill	569,150		1,182,899
Other intangible assets, net of accumulated amortization of $168,602 and $205,757	429,025		566,756
Operating lease assets	35,296		35,063
Deferred tax assets, net	79,297		67,660

Other assets	21,013		17,964
Total assets	$	2,407,554	$	3,132,083

Liabilities and Stockholders’ Equity
Liabilities, current:
Accounts payable	$	283,154	$	269,405
Accrued expenses and other current liabilities	196,664		160,740
Income taxes payable	48,259		26,739
Long-term debt, current maturities	21,875		9,375

Total liabilities, current	549,952		466,259

Long-term debt, excluding current maturities	871,345		907,519
Lease liabilities, non-current	39,455		39,949
Deferred tax liabilities, net	13,100		29,283
Other liabilities, non-current	7,420		5,634
Total liabilities	1,481,272		1,448,644

Commitments and contingencies

Stockholders’ equity:
Cumulative preferred stock, non-voting, $1.00 par. Authorized 2,000,000 shares; none issued	—		—
Common stock, $0.10 par. Authorized 50,000,000 shares; 22,962,284 and 22,856,066 shares issued and outstanding	2,296		2,286
Additional paid in capital	377,039		367,106
Accumulated other comprehensive (loss) income	(5,461)		2,278
Retained earnings	552,408		1,311,769
Total stockholders’ equity	926,282		1,683,439
Total liabilities and stockholders’ equity	$	2,407,554	$	3,132,083

See accompanying notes to condensed consolidated financial statements.

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HELEN OF TROY LIMITED AND SUBSIDIARIES

Condensed Consolidated Statements of (Loss) Income (Unaudited)


	Three Months Ended August 31,				Six Months Ended August 31,
(in thousands, except per share data)	2025		2024		2025		2024
Sales revenue, net	$	431,781	$	474,221	$	803,436	$	891,068
Cost of goods sold	241,100		258,151		437,744		471,919
Gross profit	190,681		216,070		365,692		419,149

Selling, general and administrative expense (“SG&A”)	176,999		179,692		344,663		350,173
Asset impairment charges	326,394		—		740,779		—
Restructuring charges	3,005		1,526		3,005		3,361
Operating (loss) income	(315,717)		34,852		(722,755)		65,615

Non-operating income, net	249		170		557		270
Interest expense	14,221		13,216		28,029		25,759
(Loss) income before income tax	(329,689)		21,806		(750,227)		40,126

Income tax (benefit) expense	(21,046)		4,792		9,134		16,908
Net (loss) income	$	(308,643)	$	17,014	$	(759,361)	$	23,218




(Loss) earnings per share:
Basic	$	(13.44)	$	0.75	$	(33.09)	$	1.00
Diluted	(13.44)		0.74		(33.09)		1.00








Weighted average shares used in computing (loss) earnings per share:
Basic	22,959		22,814		22,951		23,169
Diluted	22,959		22,839		22,951		23,236

See accompanying notes to condensed consolidated financial statements.

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HELEN OF TROY LIMITED AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive (Loss) Income (Unaudited)


	Three Months Ended August 31,				Six Months Ended August 31,
(in thousands)	2025		2024		2025		2024
Net (loss) income	$	(308,643)	$	17,014	$	(759,361)	$	23,218
Other comprehensive loss, net of tax:
Cash flow hedge activity - interest rate swaps	(1,449)		(3,446)		(157)		(2,521)
Cash flow hedge activity - foreign currency contracts	(534)		(866)		(7,582)		(1,093)
Total other comprehensive loss, net of tax	(1,983)		(4,312)		(7,739)		(3,614)
Comprehensive (loss) income	$	(310,626)	$	12,702	$	(767,100)	$	19,604

See accompanying notes to condensed consolidated financial statements.

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HELEN OF TROY LIMITED AND SUBSIDIARIES

Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)


	Common Stock			Additional Paid in Capital		Accumulated Other Comprehensive Income (Loss)		Retained Earnings		Total Stockholders’ Equity
(in thousands, including shares)	Shares	Par Value
Balances at February 29, 2024	23,751	$	2,375	$	348,739	$	2,099	$	1,284,229	$	1,637,442
Net income	—	—		—		—		6,204		6,204

Other comprehensive income, net of tax	—	—		—		698		—		698
Exercise of stock options	6	1		351		—		—		352
Issuance and settlement of restricted stock	71	7		(7)		—		—		—
Issuance of common stock related to stock purchase plan	19	2		2,004		—		—		2,006
Common stock repurchased and retired	(1,037)	(104)		(6,720)		—		(96,211)		(103,035)
Share-based compensation	—	—		5,833		—		—		5,833

Balances at May 31, 2024	22,810	$	2,281	$	350,200	$	2,797	$	1,194,222	$	1,549,500
Net income	—	—		—		—		17,014		17,014

Other comprehensive loss, net of tax	—	—		—		(4,312)		—		(4,312)

Issuance and settlement of restricted stock	6	—		—		—		—		—

Common stock repurchased and retired	(1)	—		(109)		—		—		(109)
Share-based compensation	—	—		5,487		—		—		5,487

Balances at August 31, 2024	22,815	$	2,281	$	355,578	$	(1,515)	$	1,211,236	$	1,567,580




Balances at February 28, 2025	22,856	$	2,286	$	367,106	$	2,278	$	1,311,769	$	1,683,439
Net loss	—	—		—		—		(450,718)		(450,718)

Other comprehensive loss, net of tax	—	—		—		(5,756)		—		(5,756)

Issuance and settlement of restricted stock	75	7		(8)		—		—		(1)
Issuance of common stock related to stock purchase plan	39	4		1,753		—		—		1,757
Common stock repurchased and retired	(25)	(3)		(1,328)		—		—		(1,331)
Share-based compensation	—	—		296		—		—		296

Balances at May 31, 2025	22,945	$	2,294	$	367,819	$	(3,478)	$	861,051	$	1,227,686
Net loss	—	—		—		—		(308,643)		(308,643)

Other comprehensive loss, net of tax	—	—		—		(1,983)		—		(1,983)

Issuance and settlement of restricted stock	22	2		(1)		—		—		1

Common stock repurchased and retired	(5)	—		(151)		—		—		(151)
Share-based compensation	—	—		9,372		—		—		9,372

Balances at August 31, 2025	22,962	$	2,296	$	377,039	$	(5,461)	$	552,408	$	926,282

See accompanying notes to condensed consolidated financial statements.

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HELEN OF TROY LIMITED AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows (Unaudited)


	Six Months Ended August 31,
(in thousands)	2025		2024
Cash provided by operating activities:
Net (loss) income	$	(759,361)	$	23,218


Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization	26,944		27,628
Amortization of financing costs	764		639
Non-cash operating lease expense	4,336		5,840
Provision for credit losses	342		112
Non-cash share-based compensation	9,668		11,320
Asset impairment charges	740,779		—

Gain on the sale or disposal of property and equipment	(75)		(29)

Deferred income taxes and tax credits	(25,770)		9,039
Changes in operating capital, net of effects of acquisition of business:
Receivables	77,353		26,340
Inventory	(76,278)		(73,630)
Prepaid expenses and other current assets	(8,006)		(5,805)
Other assets and liabilities, net	(1,756)		(441)
Accounts payable	11,723		78,922
Accrued expenses and other current liabilities	26,378		(22,529)
Accrued income taxes	20,827		(10,708)
Net cash provided by operating activities	47,868		69,916



Cash used by investing activities:
Capital and intangible asset expenditures	(24,832)		(14,026)
Net proceeds from business acquired	3,880		—
Payments for purchases of U.S. Treasury Bills	(1,387)		(1,363)
Proceeds from the maturity of U.S. Treasury Bills	1,275		1,249

Proceeds from the sale of property and equipment	89		39
Net cash used by investing activities	(20,975)		(14,101)



Cash used by financing activities:
Proceeds from revolving loans	317,200		509,930
Repayment of revolving loans	(583,400)		(459,880)
Proceeds from term loans	250,000		—

Repayment of long-term debt	(7,031)		(3,125)
Payment of financing costs	(434)		(318)
Proceeds from share issuances under share-based compensation plans	1,757		2,358

Payments for repurchases of common stock	(1,482)		(103,144)
Net cash used by financing activities	(23,390)		(54,179)



Net increase in cash and cash equivalents	3,503		1,636
Cash and cash equivalents, beginning balance	18,867		18,501
Cash and cash equivalents, ending balance	$	22,370	$	20,137



Supplemental non-cash investing activity:
Capital expenditures included in accounts payable and accrued expenses	$	7,953	$	7,767

See accompanying notes to condensed consolidated financial statements.

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HELEN OF TROY LIMITED AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

August 31, 2025

Note 1 - Basis of Presentation and Related Information

Corporate Overview

The accompanying condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly our consolidated financial position as of August 31, 2025 and February 28, 2025, and the results of our consolidated operations for the interim periods presented. We follow the same accounting policies when preparing quarterly financial data as we use for preparing annual data. These statements should be read in conjunction with the consolidated financial statements and the notes included in our latest annual report on Form 10-K for the fiscal year ended February 28, 2025 (“Form 10-K”), and our other reports on file with the Securities and Exchange Commission (the “SEC”).

When used in these notes, unless otherwise indicated or the context suggests otherwise, references to “the Company”, “our Company”, “Helen of Troy”, “we”, “us”, or “our” refer to Helen of Troy Limited and its subsidiaries, which are all wholly-owned. We refer to our common shares, par value $0.10 per share, as “common stock.” References to “fiscal” in connection with a numeric year number denotes our fiscal year ending on the last day of February, during the year number listed. References to “the FASB” refer to the Financial Accounting Standards Board. References to “GAAP” refer to accounting principles generally accepted in the United States of America (the “U.S.”). References to “ASU” refer to the codification of GAAP in the Accounting Standards Updates issued by the FASB. References to “ASC” refer to the codification of GAAP in the Accounting Standards Codification issued by the FASB.

We incorporated as Helen of Troy Corporation in Texas in 1968 and were reorganized as Helen of Troy Limited in Bermuda in 1994. We are a leading global consumer products company offering creative products and solutions for our customers through a diversified portfolio of brands. Our portfolio of brands includes OXO, Hydro Flask, Osprey, Vicks, Braun, Honeywell, PUR, Hot Tools, Drybar, Curlsmith, Revlon and Olive & June, among others. As of August 31, 2025, we operated two reportable segments: Home & Outdoor and Beauty & Wellness.

Our Home & Outdoor segment offers a broad range of outstanding world-class brands that help consumers enjoy everyday living inside their homes and outdoors. Our innovative products for home activities include food preparation and storage, cooking, cleaning, organization, and beverage service. Our outdoor performance range, on-the-go food storage, and beverageware includes lifestyle hydration products, coolers and food storage solutions, backpacks, and travel gear. The Beauty & Wellness segment provides consumers with a broad range of outstanding world-class brands for beauty and wellness. In Beauty, we deliver innovation through products such as hair styling appliances, grooming tools, liquid and aerosol personal care products, and nail care solutions that help consumers look and feel more beautiful. In Wellness, we are there when you need us most with highly regarded humidifiers, thermometers, water and air purifiers, heaters, and fans.

Our business is seasonal due to different calendar events, holidays and seasonal weather and illness patterns. Our fiscal reporting period ends on the last day in February. Historically, our highest sales volume and operating income occur in our third fiscal quarter ending November 30th. We purchase our products from unaffiliated manufacturers, most of which are located in China, Mexico, Vietnam and the U.S.

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On December 16, 2024, we completed the acquisition of Olive & June, LLC (“Olive & June”), an innovative, omni-channel nail care brand. The Olive & June brand and products were added to the Beauty & Wellness segment. The total purchase consideration consists of initial cash consideration of $224.7 million, which is net of cash acquired and a favorable post-closing adjustment of $3.9 million, and contingent cash consideration of up to $15.0 million subject to Olive & June’s performance during calendar years 2025, 2026, and 2027, payable annually. See Note 4 and Note 11 for additional information.

Principles of Consolidation

The accompanying condensed consolidated financial statements are prepared in accordance with GAAP and include all of our subsidiaries. Our condensed consolidated financial statements are prepared in U.S. Dollars. All intercompany balances and transactions are eliminated in consolidation.

The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Actual results may differ materially from those estimates.

Note 2 - New Accounting Pronouncements

Except for the changes discussed below, there have been no changes in the information provided in our Form 10-K.

Not Yet Adopted

In July 2025, the FASB issued ASU 2025-05, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, which permits entities to elect a practical expedient to assume current conditions as of the balance sheet date will not change for the remaining life of accounts receivable and contract assets when developing forecasts as part of estimating expected credit losses. The amendments in ASU 2025-05 are effective for fiscal years beginning after December 15, 2025, and interim periods within those fiscal years, with early adoption permitted. The amendments should be applied prospectively. This ASU will be effective for us in the first quarter of fiscal 2027. We are currently evaluating this practical expedient and do not expect it to have a material impact on our consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which removes all references to software development project stages and requires entities to start capitalizing software costs when both of the following occur: (i) management has authorized and committed to funding the software project and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. The amendments in ASU 2025-06 are effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years, with early adoption permitted as of the beginning of a fiscal year. The amendments can be applied prospectively, retrospectively, or via a modified prospective transition method. This ASU will be effective for us in the first quarter of fiscal 2029. We are currently evaluating the impact this guidance may have on our consolidated financial statements.

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Note 3 - Accrued Expenses and Other Current Liabilities

A summary of accrued expenses and other current liabilities was as follows:


(in thousands)	August 31, 2025		February 28, 2025
Accrued compensation, benefits and payroll taxes	$	26,760	$	16,096
Accrued sales discounts and allowances	46,035		36,600
Accrued sales returns	21,559		20,190
Accrued advertising	29,199		25,716
Other	73,111		62,138
Total accrued expenses and other current liabilities	$	196,664	$	160,740

Note 4 - Acquisition of Olive & June

On December 16, 2024, we completed the acquisition of 100% of the membership interests of Olive & June, an innovative, omni-channel nail care brand. Olive & June products deliver a salon-quality experience at home and include nail polish, press-on nails, manicure and pedicure systems, grooming tools and nail care essentials. The acquisition of Olive & June complements and broadens our existing Beauty portfolio beyond the hair care category. The Olive & June brand and products were added to the Beauty & Wellness segment. The total purchase consideration consists of initial cash consideration of $224.7 million, which is net of cash acquired and a favorable post-closing adjustment of $3.9 million, and contingent cash consideration of up to $15.0 million subject to Olive & June’s performance during calendar years 2025, 2026, and 2027, payable annually. The acquisition was funded with cash on hand and borrowings under our existing revolving credit facility.

The contingent cash consideration of up to $15.0 million is payable annually in three equal installments subject to Olive & June achieving certain annual adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) targets during calendar years 2025, 2026 and 2027. If the annual adjusted EBITDA target is not met, no payment is required. As of the acquisition date, we recorded a liability for the estimated fair value of the contingent consideration of $4.1 million, of which $1.8 million and $2.3 million was included within accrued expenses and other current liabilities and other liabilities, non-current, respectively, in our condensed consolidated balance sheet. This contingent consideration liability is remeasured at fair value each reporting period until the contingency is resolved, with changes in fair value recognized in SG&A. See Note 11 for additional information regarding the estimated fair value of our contingent consideration liability.

We accounted for the acquisition as a purchase of a business and recorded the excess of the purchase price over the provisionally determined estimated fair value of the assets acquired and liabilities assumed as goodwill. Adjustments to these provisional amounts may be made during the measurement period as we continue to obtain and evaluate information necessary to finalize these amounts. The goodwill recognized is attributable primarily to expected synergies including leveraging our operational scale, existing customer relationships and distribution capabilities. The goodwill is expected to be deductible for income tax purposes. We have provisionally determined the appropriate fair values of the acquired intangible assets and completed our analysis of the economic lives of the assets acquired. We assigned $51.0 million to trade names and are amortizing over a 15 year expected life. We assigned $8.0 million to customer relationships and are amortizing over a 8.5 year expected life, based on historical attrition rates. We assigned $1.6 million to non-compete agreements and are amortizing over a 5 year expected life.

During the first quarter of fiscal 2026, we made adjustments to provisional asset and liability balances, which resulted in a corresponding net decrease to goodwill of $0.3 million. We also finalized the net

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working capital adjustment during the first quarter of fiscal 2026, which resulted in a $3.9 million reduction to the total purchase consideration and goodwill.

The following table presents the preliminary estimated fair values of assets acquired and liabilities assumed at the acquisition date:


(in thousands)
Assets:
Receivables	$	13,182
Inventory	15,121
Prepaid expenses and other current assets	3,920
Property and equipment	1,490
Goodwill	150,681
Trade names - definite	51,000
Customer relationships - definite	8,000
Other intangible assets - definite	1,600
Other assets	275
Total assets	245,269
Liabilities:
Accounts payable	5,614
Accrued expenses and other current liabilities	12,686
Other liabilities, non-current	2,300
Total liabilities	20,600
Net assets recorded	$	224,669

Note 5 - Goodwill and Intangibles

We perform annual impairment testing each fiscal year and interim impairment testing, if necessary. We write down any asset deemed to be impaired to its fair value.

During the first and second quarters of fiscal 2026, we concluded that a goodwill impairment triggering event had occurred due to a further sustained decline in our stock price, resulting in our carrying value (excluding long-term debt) exceeding the Company’s total enterprise value (market capitalization plus long-term debt). Additional factors that contributed to these conclusions included downward revisions to our internal forecasts and strategic long-term plans, which reflect the tariff policies in effect and the related macroeconomic environment at the end of our first and second quarters of fiscal 2026, including the corresponding impact on consumer spending and retailer orders. These factors were applicable to all of our reporting units, indefinite-lived trademark licenses and trade names and definite-lived trademark licenses, trade names and certain other intangible assets. Thus, we performed quantitative impairment testing on our goodwill and intangible assets described above during the first and second quarters of fiscal 2026.

We estimate the fair value of our trade names and trademark licenses using the relief from royalty method income approach which is based upon projected future discounted cash flows (“DCF Model”). We estimate the fair value of our customer relationships and lists using the distributor method income approach which is based upon a DCF Model. After adjusting the carrying values of our indefinite-lived and definite-lived intangible assets, the Company completed quantitative impairment testing for goodwill. We estimate the fair value of our reporting units using an income approach based upon projected future discounted cash flows.

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Based on the outcome of these assessments, we recognized pre-tax asset impairment charges as follows:


(in thousands)	Three Months Ended August 31, 2025		Six Months Ended August 31, 2025
Home & Outdoor (1)	$	85,537	$	304,632
Beauty & Wellness (2)	240,857		436,147
Total	$	326,394	$	740,779

(1)Asset impairment charges recognized for our Home & Outdoor segment included charges for our Hydro Flask and Osprey businesses of $44.7 million and $40.8 million, respectively, for the three months ended August 31, 2025 and $165.5 million and $139.1 million, respectively, for the six months ended August 31, 2025.

(2)Asset impairment charges recognized for our Beauty & Wellness segment included charges for our Health & Wellness, Drybar, Curlsmith and Revlon businesses of $160.9 million, $47.8 million, $28.4 million and $3.9 million, respectively, for the three months ended August 31, 2025 and $196.6 million, $151.4 million, $64.6 million and $23.5 million, respectively, for the six months ended August 31, 2025.

During the first quarter of fiscal 2026, in connection with our annual budgeting and forecasting process, management reduced its forecasts for net sales revenue, gross margin and earnings before interest and taxes to reflect the tariff policies in effect and the related macroeconomic environment at the end of our first quarter of fiscal 2026, including the corresponding impact on consumer spending and retailer orders, as applicable. The revised forecasts also resulted in management selecting lower residual growth rates, which were also reflective of revised long-term industry growth expectations, and royalty rates, as applicable. During the second quarter of fiscal 2026, management further reduced its forecasts for net sales revenue, gross margin and earnings before interest and taxes to reflect the tariff policies in effect and the related macroeconomic environment at the end of our second quarter of fiscal 2026, including the impact on consumer spending, retailer orders and China cross border ecommerce due to a shift to localized distribution, as applicable. We did not recognize any asset impairment charges during the three and six months ended August 31, 2024. Refer to Note 11 for additional information on our valuation method and related assumptions and estimates. For additional information regarding the testing and analysis performed, refer to “Critical Accounting Policies and Estimates” in Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations”.

The following table summarizes the changes in our goodwill by segment for the six months ended August 31, 2025:


(in thousands)	Home & Outdoor		Beauty & Wellness		Total






Gross carrying amount as of February 28, 2025	$	491,777	$	729,792	$	1,221,569
Accumulated impairment as of February 28, 2025	—		(38,670)		(38,670)



Net carrying amount as of February 28, 2025	$	491,777	$	691,122	$	1,182,899
Acquisitions (1)	—		(4,158)		(4,158)
Impairment charges (2)	(229,058)		(380,533)		(609,591)
Gross carrying amount as of August 31, 2025	$	491,777	$	725,634	$	1,217,411
Accumulated impairment as of August 31, 2025	(229,058)		(419,203)		(648,261)
Net carrying amount as of August 31, 2025	$	262,719	$	306,431	$	569,150

(1)Reflects a favorable post-closing adjustment to goodwill recorded in the Beauty & Wellness segment during the first quarter of fiscal 2026 in connection with the acquisition of Olive & June on December 16, 2024. For additional information see Note 4.

(2)The Home & Outdoor segment reflects goodwill impairment charges related to our Hydro Flask and Osprey reporting units of $41.7 million and $19.8 million, respectively, for the three months ended August 31, 2025 and $115.9 million and $113.1 million, respectively, for the six months ended August 31, 2025. The Beauty & Wellness segment reflects goodwill impairment charges related to our Health & Wellness, Drybar and Curlsmith reporting units of $159.9 million, $46.8 million and $24.5 million, respectively, for the three months ended August 31, 2025 and $189.6 million, $134.1 million and

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$56.8 million, respectively, for the six months ended August 31, 2025. The remaining carrying values of the Osprey, Health & Wellness, Drybar and Curlsmith reporting units’ goodwill as of August 31, 2025 were $96.6 million, $95.3 million, $0.2 million and $60.3 million, respectively. The goodwill impairment charges recognized for the Hydro Flask reporting unit reduced the carrying value of its goodwill to zero.

The following table summarizes the components of our other intangible assets as follows:


	August 31, 2025						February 28, 2025
(in thousands)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Indefinite-lived:
Trademark licenses	$	7,400	$	—	$	7,400	$	7,400	$	—	$	7,400
Trade names (1)	285,200		—		285,200		358,200		—		358,200

Definite-lived:
Trademark licenses (2)	45,700		(2,480)		43,220		75,050		(9,454)		65,596
Trade names (3)	64,150		(2,851)		61,299		89,365		(14,030)		75,335
Customer relationships and lists (4)	137,001		(113,534)		23,467		168,201		(120,932)		47,269
Other intangibles (5)	58,176		(49,737)		8,439		74,297		(61,341)		12,956
Total	$	597,627	$	(168,602)	$	429,025	$	772,513	$	(205,757)	$	566,756

(1)Balances as of August 31, 2025 reflect total impairment charges of $25.0 million and $73.0 million recognized during the three and six months ended August 31, 2025, respectively, which include $3.0 million and $40.0 million related to our Hydro Flask trade name, respectively, $21.0 million and $26.0 million related to our Osprey trade name, respectively, and $1.0 million and $7.0 million related to our PUR trade name, respectively. The remaining carrying values of the Hydro Flask, Osprey and PUR trade names as of August 31, 2025 were $19.0 million, $144.0 million and $47.0 million, respectively. These impairment charges for Hydro Flask and Osprey were recorded in the Home & Outdoor segment. The impairment charges for PUR were recorded in the Beauty & Wellness segment.

(2)Balances as of August 31, 2025 reflect impairment charges recorded during the three and six months ended August 31, 2025 in the Beauty & Wellness segment of $3.9 million and $23.5 million, respectively, related to our Revlon trademark license. The remaining carrying value of this trademark license as of August 31, 2025 was $40.7 million.

(3)Balances as of August 31, 2025 reflect total impairment charges recorded during the three and six months ended August 31, 2025 in the Beauty & Wellness segment of $4.9 million and $11.6 million, respectively, which include $3.9 million and $7.8 million related to our Curlsmith trade name, respectively, and $1.0 million and $3.8 million related to our Drybar trade name, respectively. The remaining carrying values of the Curlsmith and Drybar trade names as of August 31, 2025 were $9.8 million and $2.9 million, respectively.

(4)Balances as of August 31, 2025 reflect total impairment charges of $19.5 million recognized during the six months ended August 31, 2025, which includes $10.7 million and $8.8 million recorded in the Beauty & Wellness and Home & Outdoor segments, respectively, related to our Drybar and Hydro Flask customer relationships which reduced the carrying values of these assets to zero. No impairment charges were recognized during the three months ended August 31, 2025 related to our customer relationships and lists.

(5)Balances as of August 31, 2025 reflect total impairment charges of $3.6 million recognized during the six months ended August 31, 2025, which includes $2.8 million and $0.8 million recorded in the Beauty & Wellness and Home & Outdoor segments, respectively, related to Drybar and Hydro Flask other intangibles which reduced the carrying values of these assets to zero. No impairment charges were recognized during the three months ended August 31, 2025 related to our other intangible assets.

During the three and six months ended August 31, 2025, we recorded amortization expense of $3.9 million and $8.9 million, respectively, compared to $4.5 million and $9.1 million during the same periods last year, respectively.

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The following table summarizes amortization expense related to our other intangible assets as follows:


Estimated Amortization Expense (in thousands)
Fiscal 2026	$	16,412
Fiscal 2027	11,602
Fiscal 2028	8,936
Fiscal 2029	8,908
Fiscal 2030	8,609
Fiscal 2031	7,770

Note 6 - Share-Based Compensation Plans

As part of our compensation structure, we grant share-based compensation awards to certain employees and non-employee members of our Board of Directors during the fiscal year. These awards may be subject to attainment of certain service conditions, performance conditions and/or market conditions. In connection with our annual grant during the first quarter of fiscal 2026, we granted 272,909 service condition awards (“Service Condition Awards”) with a weighted average grant date fair value of $53.28. Additionally, we granted 320,027 performance-based awards during the first quarter of fiscal 2026, of which 191,946 contained performance conditions (“Performance Condition Awards”) and 128,081 contained market conditions (“Market Condition Awards”), with weighted average grant date fair values of $53.28 and $37.24, respectively. Refer to our Form 10-K for further information on the Company’s share-based compensation plans.

The Helen of Troy Limited 2018 Stock Incentive Plan (“2018 Plan”) became effective on August 22, 2018. On August 20, 2025, our shareholders approved the 2025 Stock Incentive Plan (the “2025 Plan”) which replaced the 2018 Plan. As a result, the 2018 Plan terminated on August 20, 2025, but will continue to apply to awards granted under the 2018 Plan before such date. The 2025 Plan permits the granting of stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based awards. As of August 20, 2025, the 2025 Plan had 1,155,478 shares available for future issuance, including shares which remained available for issuance under the 2018 Plan immediately prior to August 20, 2025. There were no grants or issuances from the 2025 Plan during the second quarter of fiscal 2026.

We recorded share-based compensation expense in SG&A as follows:


	Three Months Ended August 31,				Six Months Ended August 31,
(in thousands)	2025		2024		2025 (1)		2024

Directors’ stock compensation	$	196	$	196	$	392	$	392
Service Condition Awards	6,627		2,826		10,568		5,394
Performance Condition Awards	1,664		1,093		(2,862)		2,140
Market Condition Awards	885		1,372		1,009		2,767
Employee stock purchase plan	—		—		561		627
Share-based compensation expense	9,372		5,487		9,668		11,320
Less: income tax benefits	(445)		(221)		(602)		(485)
Share-based compensation expense, net of income tax benefits	$	8,927	$	5,266	$	9,066	$	10,835

(1)Share-based compensation expense during the six months ended August 31, 2025 includes a benefit for Performance Condition Awards, as a result of a change in estimate from target achievement to zero percent achievement for Performance Condition Awards granted during fiscal 2024.

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Unrecognized Share-Based Compensation Expense

As of August 31, 2025, our total unrecognized share-based compensation for all awards was $26.6 million, which will be recognized over a weighted average amortization period of 2.1 years. The total unrecognized share-based compensation reflects an estimate of target achievement for Performance Condition Awards granted during fiscal 2026 and fiscal 2025 and an estimate of zero percent of target achievement for Performance Condition Awards granted during fiscal 2024.

Note 7 - Repurchases of Common Stock

In August 2024, our Board of Directors authorized the repurchase of up to $500 million of our outstanding common stock. The authorization became effective August 20, 2024, for a period of three years, and replaced our former repurchase authorization. As of August 31, 2025, our repurchase authorization allowed for the purchase of $498.4 million of common stock.

Our current equity-based compensation plans include provisions that allow for the “net exercise” of share-settled awards by all plan participants. In a net exercise, any required payroll taxes, federal withholding taxes and exercise price of the shares due from the option or other share-based award holders are settled by having the holder tender back to us a number of shares at fair value equal to the amounts due. Net exercises are treated as repurchases of shares.

The following table summarizes our share repurchase activity for the periods shown:


	Three Months Ended August 31,				Six Months Ended August 31,
(in thousands, except share and per share data)	2025		2024		2025		2024
Common stock repurchased on the open market:
Number of shares	—		—		—		1,011,243
Aggregate value of shares	$	—	$	—	$	—	$	100,019
Average price per share	$	—	$	—	$	—	$	98.91

Common stock received in connection with share-based compensation:
Number of shares	5,279		1,403		29,939		26,775
Aggregate value of shares	$	151	$	109	$	1,482	$	3,125
Average price per share	$	28.65	$	78.07	$	49.50	$	116.72

Note 8 - Restructuring Plan

During fiscal 2023, we initiated a global restructuring plan intended to expand operating margins through initiatives designed to improve efficiency and effectiveness and reduce costs (referred to as “Project Pegasus”). During the fourth quarter of fiscal 2025, we completed Project Pegasus, but still expect to realize the targeted savings through fiscal 2027. Project Pegasus included initiatives to further optimize our brand portfolio, streamline and simplify the organization, accelerate and amplify cost of goods savings projects, enhance the efficiency of our supply chain network, optimize our indirect spending and improve our cash flow and working capital, as well as other activities. These initiatives created operating efficiencies, as well as provided a platform to fund growth investments. During fiscal 2023, 2024 and 2025 we incurred restructuring charges in connection with Project Pegasus primarily for professional fees and severance and employee related costs, which were recorded as “Restructuring charges” in the condensed consolidated statements of (loss) income. Restructuring charges primarily represented cash expenditures and were substantially paid by the end of fiscal 2025, with a remaining liability of $7.7 million as of February 28, 2025.

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During the three and six months ended August 31, 2024, we incurred $1.5 million and $3.4 million, respectively, of pre-tax restructuring costs in connection with Project Pegasus, which were primarily comprised of severance and employee related costs and professional fees. During the six months ended August 31, 2025 and August 31, 2024, we made total cash restructuring payments related to Project Pegasus of $4.0 million and $5.6 million, respectively, and had a remaining liability of $3.7 million as of August 31, 2025 which is included in accrued expenses and other current liabilities. The cash payments during both the six months ended August 31, 2025 and 2024 were primarily for severance and employee related costs. For information regarding Project Pegasus savings, refer to Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” including “Project Pegasus.”

Note 9 - Commitments and Contingencies

Legal Matters

We are involved in various legal claims and proceedings in the normal course of operations. We believe the outcome of these matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity, except as described below.

On December 23, 2021, Brita LP filed a complaint against Kaz USA, Inc. and Helen of Troy Limited in the U.S. District Court for the Western District of Texas (the “Patent Litigation”), alleging patent infringement by the Company relating to its PUR gravity-fed water filtration systems. In the Patent Litigation, Brita LP seeks monetary damages and injunctive relief relating to the alleged infringement. Brita LP simultaneously filed a complaint with the U.S. International Trade Commission (“ITC”) against Kaz USA, Inc., Helen of Troy Limited and five other unrelated companies that sell water filtration systems (the “ITC Action”). The complaint in the ITC Action also alleged patent infringement by the Company with respect to a limited set of PUR gravity-fed water filtration systems. In the ITC Action, Brita LP requested the ITC to initiate an unfair import investigation relating to such filtration systems. This action sought injunctive relief to prevent entry of certain accused PUR products (and certain other products) into the U.S. and cessation of marketing and sales of existing inventory already in the U.S. On January 25, 2022, the ITC instituted the investigation requested by the ITC Action. Discovery closed in the ITC Action in May 2022, and approximately half of the originally identified PUR gravity-fed water filters were removed from the case and are no longer included in the ITC Action. In August 2022, the parties participated in the evidentiary hearing, with additional supplemental hearings in October 2022. On February 28, 2023, the ITC issued an Initial Determination in the ITC Action, tentatively ruling against the Company and the other unrelated respondents. The ITC has a guaranteed review process, and thus all respondents, including the Company, filed a petition with the ITC for a full review of the Initial Determination. On September 19, 2023, the ITC issued its Final Determination in the Company’s favor. The ITC determined there was no violation by the Company and terminated the investigation. Brita LP is appealing the ITC’s decision to the Federal Circuit (“CAFC Appeal”) and filed its Notice of Appeal on October 24, 2023. The Company intervened in the CAFC Appeal and oral argument occurred on August 5, 2025. We are now awaiting the Federal Circuit’s opinion. The Patent Litigation remains stayed for the time being. We cannot predict the outcome of these legal proceedings, the amount or range of any potential loss, when the proceedings will be resolved, or customer acceptance of any replacement water filter. Litigation is inherently unpredictable, and the resolution or disposition of these proceedings could, if adversely determined, have a material and adverse impact on our financial position and results of operations.

Regulatory Matters

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of these packaging compliance discussions, we voluntarily implemented a temporary stop shipment action on the impacted products as we worked with the EPA towards an expedient resolution. We resumed normalized levels of shipping of the affected inventory during fiscal 2022, and we completed the repackaging and relabeling of our existing inventory of impacted products during fiscal 2023. Additionally, as a result of continuing dialogue with the EPA, we executed further repackaging and relabeling plans on certain additional humidifier products and certain additional air filtration products, which were also completed during fiscal 2023. Ongoing settlement discussions with the EPA related to this matter may result in the imposition of fines or penalties in the future. Such potential fines or penalties cannot be reasonably estimated. For additional information refer to Part I, Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” including “EPA Compliance Costs.”

Note 10 - Long-Term Debt

A summary of our long-term debt follows:


(in thousands)	August 31, 2025		February 28, 2025
Credit Agreement (1):
Revolving loans	$	411,900	$	678,100
Term loans	486,719		243,750
Total borrowings under Credit Agreement	898,619		921,850
Unamortized prepaid financing fees	(5,399)		(4,956)
Total long-term debt	893,220		916,894
Less: current maturities of long-term debt	(21,875)		(9,375)
Long-term debt, excluding current maturities	$	871,345	$	907,519

(1)The weighted average interest rates on borrowings outstanding under the Credit Agreement (defined below) inclusive of the impact of our interest rate swaps as of August 31, 2025 and February 28, 2025 were 5.9% and 5.6%, respectively.

Credit Agreement

We have a credit agreement (the “Credit Agreement”) with Bank of America, N.A., as administrative agent, and other lenders that provides for aggregate commitments of $1.5 billion, which are available through (i) a $1.0 billion revolving credit facility, which includes a $50 million sublimit for the issuance of letters of credit, (ii) a $250 million term loan facility, and (iii) a committed $250 million delayed draw term loan facility, which permitted multiple drawdowns until August 15, 2025. Proceeds can be used for working capital and other general corporate purposes, including funding permitted acquisitions. At the closing date, February 15, 2024, we borrowed $457.5 million under the revolving credit facility and $250.0 million under the term loan facility and utilized the proceeds to repay all debt outstanding under our prior credit agreement. During the first quarter of fiscal 2026, we borrowed $250.0 million under the delayed draw term loan facility and utilized the proceeds to repay debt outstanding under the revolving credit facility. During the first quarter of fiscal 2026, we capitalized $0.4 million of lender fees and a de minimis amount of third-party fees incurred in connection with the delayed draw term loan facility borrowing, which were recorded as prepaid financing fees in long-term debt. The Credit Agreement matures on February 15, 2029. The Credit Agreement includes an accordion feature, which permits the Company to request to increase its borrowing capacity by an additional $300 million plus an unlimited amount when the Leverage Ratio (as defined in the Credit Agreement) on a pro-forma basis is less than 3.25 to 1.00. The term loans are payable at the end of each fiscal quarter in equal installments of 0.625% through February 28, 2025, 0.9375% through February 28, 2026, and 1.25% thereafter of the original principal balance of the term loans, which began in the first quarter of fiscal 2025 for the term loan facility and began in the second quarter of fiscal 2026 for the delayed draw term loan facility, with the remaining balance due at the maturity date. Borrowings under the Credit Agreement bear floating interest at either the Base Rate or Term SOFR (as defined in the Credit Agreement), plus a margin based on the Net

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Leverage Ratio (as defined in the Credit Agreement) of 0% to 1.125% and 1.0% to 2.125% for Base Rate and Term SOFR borrowings, respectively.

The floating interest rates on our borrowings under the Credit Agreement are hedged with interest rate swaps to effectively fix interest rates on $625 million and $550 million of the outstanding principal balance under the Credit Agreement as of August 31, 2025 and February 28, 2025, respectively. See Notes 11, 12, and 13 for additional information regarding our interest rate swaps.

In connection with the acquisition of Olive & June, we provided notice of a qualified acquisition and borrowed $235.0 million under our Credit Agreement to fund the acquisition initial cash consideration. The exercise of the qualified acquisition notice triggered temporary adjustments to the maximum leverage ratio, which was 3.50 to 1.00 before the impact of the qualified acquisition notice. As a result of the qualified acquisition notice, commencing at the beginning of our fourth quarter of fiscal 2025, the maximum leverage ratio is 4.50 to 1.00 through November 30, 2025 and 3.50 to 1.00 thereafter. For additional information on the acquisition, see Note 4.

As of August 31, 2025, the balance of outstanding letters of credit was $9.5 million, the amount available for revolving loans under the Credit Agreement was $578.6 million and the amount available per the maximum leverage ratio was $212.7 million. Covenants in the Credit Agreement limit the amount of total indebtedness we can incur. As of August 31, 2025, these covenants effectively limited our ability to incur more than $212.7 million of additional debt from all sources, including the Credit Agreement.

Debt Covenants

Our debt under our Credit Agreement is unconditionally guaranteed, on a joint and several basis, by the Company and certain of its subsidiaries. Our Credit Agreement requires the maintenance of certain key financial covenants. Our Credit Agreement also contains other customary covenants, including, among other things, covenants restricting or limiting us, except under certain conditions set forth therein, from (1) incurring liens on our properties, (2) making certain types of investments, (3) incurring additional debt, and (4) assigning or transferring certain licenses. Our Credit Agreement also contains customary events of default, including failure to pay principal or interest when due, among others. Upon an event of default under our Credit Agreement, the lenders may, among other things, accelerate the maturity of any amounts outstanding. The commitments of the lenders to make loans to us under the Credit Agreement are several and not joint. Accordingly, if any lender fails to make loans to us, our available liquidity could be reduced by an amount up to the aggregate amount of such lender’s commitments under the Credit Agreement.

As of August 31, 2025, we were in compliance with all covenants as defined under the terms of the Credit Agreement. We expect it is possible that a continuation of negative sales trends and the unfavorable impact of tariffs and other macroeconomic conditions may require an amendment to the Credit Agreement to address potential compliance with certain financial covenants. We will likely proactively seek an amendment during our third fiscal quarter to implement for a limited period of time (1) an extension of the time period for the temporary adjustments to the maximum leverage ratio, and (2) a reduction in the minimum interest coverage ratio. We have discussed the potential amendment with the administrative agent and a majority of the lender group. While there can be no assurance that our negotiations with our lender group will be successful, preliminary indications are that our lenders will be supportive of this potential amendment. Our inability to obtain any amendment to the Credit Agreement could result in an event of default under the Credit Agreement, which could have a material adverse effect on our business, financial condition and liquidity.

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Note 11 - Fair Value

Fair value is defined 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. Valuation techniques under the accounting guidance related to fair value measurements are based on observable and unobservable inputs. These inputs are classified into the following hierarchy:

Level 1:Quoted prices for identical assets or liabilities in active markets;

Level 2:Observable inputs other than quoted prices that are directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets; quoted prices for similar or identical assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable; and

Level 3:Unobservable inputs that reflect the reporting entity’s own assumptions.

Recurring Fair Value Measurements

All of our financial assets and liabilities, except for our investments in U.S. Treasury Bills and our contingent consideration liability, are classified as Level 2 because their valuation is dependent on observable inputs and other quoted prices for similar assets or liabilities, or model-derived valuations whose significant value drivers are observable. Our investments in U.S. Treasury Bills are classified as Level 1 because their value is based on quoted prices in active markets for identical assets. Our contingent consideration liability is classified as Level 3 because its valuation is primarily based on a significant input unobservable in the market, specifically, projected adjusted EBITDA derived from internal forecasts.

The following table presents the fair value of our financial assets and liabilities:


	Fair Value
(in thousands)	August 31, 2025		February 28, 2025
Assets:
Cash equivalents (money market accounts)	$	3,882	$	3,852
U.S. Treasury Bills	11,562		11,268
Interest rate swaps	743		1,065
Foreign currency derivatives	149		2,163
Total assets	$	16,336	$	18,348

Liabilities:

Interest rate swaps	$	106	$	221
Contingent consideration	4,100		4,100
Foreign currency derivatives	7,692		119
Total liabilities	$	11,898	$	4,440

All of our financial assets and liabilities, except for our investments in U.S. Treasury Bills, are measured and recorded at fair value on a recurring basis. Our investments in U.S. Treasury Bills are recorded at amortized cost. As of August 31, 2025 and February 28, 2025, the current carrying amounts of our U.S. Treasury Bills were $2.6 million and $2.5 million, respectively, and were included within prepaid expenses and other current assets in our condensed consolidated balance sheets. As of August 31, 2025 and February 28, 2025, the non-current carrying amounts of our U.S. Treasury Bills were $8.9 million and

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$8.7 million, respectively, and were included within other assets in our condensed consolidated balance sheets.

The carrying amounts of cash and cash equivalents, accounts payable, accrued expenses and other current liabilities and income taxes payable approximate fair value because of the short maturity of these items. The carrying amounts of receivables approximate fair value due to the effect of the related allowance for credit losses. The carrying amount of our floating rate long-term debt approximates its fair value.

Our investments in U.S. Treasury Bills are classified as held-to-maturity because we have the positive intent and ability to hold the securities to maturity. We invest in U.S. Treasury Bills with maturities ranging from one to five years. As of both August 31, 2025 and February 28, 2025, gross unrealized gains were $0.1 million and losses were not material. During the three and six months ended August 31, 2025, we recognized interest income on these investments of $0.1 million and $0.2 million, respectively, which is included in “Non-operating income, net” in our condensed consolidated statements of (loss) income. During both the three and six months ended August 31, 2024, we recognized interest income on these investments of $0.1 million.

In connection with the acquisition of Olive & June in December 2024, we recognized contingent consideration, as a result of the total purchase consideration including contingent cash consideration of up to $15.0 million payable annually in three equal installments subject to Olive & June achieving certain adjusted EBITDA targets during calendar years 2025, 2026 and 2027. If the annual adjusted EBITDA target is not met, no payment is required. As of the acquisition date, we recorded a liability for the estimated fair value of the contingent consideration of $4.1 million, of which $1.8 million and $2.3 million was included within accrued expenses and other current liabilities and other liabilities, non-current, respectively, in our consolidated balance sheet. This contingent consideration liability is remeasured at fair value each reporting period until the contingency is resolved, with changes in fair value recognized in SG&A. During the six months ended August 31, 2025, there was no change to the estimated fair value of the contingent consideration liability. The fair value of the contingent consideration liability was determined using a Monte Carlo simulation model, which utilizes projected adjusted EBITDA and corresponding volatility and discount rates to estimate the probability of the adjusted EBITDA targets being achieved. The projected adjusted EBITDA during the earn-out period was derived from internal forecasts and represents a Level 3 input, and was discounted using an estimated discount rate of 13% as of both August 31, 2025 and February 28, 2025. Adjusted EBITDA volatility was calculated based upon peer companies, and the third quartile of 52% and 33% was selected as a key input into the Monte Carlo simulation model as of August 31, 2025 and February 28, 2025, respectively. In the simulated scenarios where a payment is earned, the projected contingent payments were discounted using an estimated credit risk discount rate of 6.7% and 6.5%, as of August 31, 2025 and February 28, 2025, respectively. Changes in these inputs may result in a significant increase or decrease in the fair value of the contingent consideration liability with a corresponding impact to SG&A.

We use foreign currency forward contracts to manage our exposure to changes in foreign currency exchange rates. In addition, we use interest rate swaps to manage our exposure to changes in interest rates. All of our derivative assets and liabilities are recorded at fair value. See Notes 12 and 13 for more information on our derivatives.

Non-Recurring Fair Value Measurements

Assets remeasured to fair value on a non-recurring basis during the six months ended August 31, 2025 represent goodwill, indefinite-lived intangible assets and definite-lived intangible assets, which were impaired. We did not remeasure any assets to fair value on a non-recurring basis during the six months ended August 31, 2024.

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The following table presents the remaining carrying value of the assets that were remeasured to fair value on a non-recurring basis:


			Fair Value Measurements						Fiscal 2026 Asset Impairment Charges
(in thousands)	August 31, 2025		Level 1		Level 2		Level 3
Goodwill	$	569,150	$	—	$	—	$	569,150	$	609,591
Indefinite-lived intangible assets	292,600		—		—		292,600		73,000
Definite-lived intangible assets	136,425		—		—		136,425		58,188
Total	$	998,175	$	—	$	—	$	998,175	$	740,779

During the six months ended August 31, 2025, our impairment testing resulted in impairment charges of $609.6 million, $73.0 million and $58.2 million to reduce the carrying values of our goodwill, indefinite-lived intangible assets and definite-lived intangible assets to their estimated fair values of $569.2 million, $292.6 million and $136.4 million, respectively. Refer to Note 5 for additional information on the assets impaired and their remaining carrying values as of August 31, 2025.

We estimate the fair value of our reporting units using an income approach based upon projected future DCF Model. Under the DCF Model, the fair value of each reporting unit is determined based on the present value of estimated future cash flows, discounted at a risk-adjusted rate of return. We use internal forecasts and strategic long-term plans to estimate future cash flows, including net sales revenue, gross profit margin, and earnings before interest and taxes margins. Other key estimates used in the DCF Model include, but are not limited to, discount rates, statutory tax rates, terminal growth rates, as well as working capital and capital expenditures needs. The discount rates are based on a weighted-average cost of capital utilizing industry market data of our peer group companies. Accordingly, this fair value measurement is classified as Level 3 since it is based primarily upon unobservable inputs that reflect management’s assumptions.

We estimate the fair value of our trade names and trademark licenses using the relief from royalty method income approach which is based upon a DCF Model. The relief-from-royalty method estimates the fair value of a trade name or trademark license by discounting the hypothetical avoided royalty payments to their present value over the economic life of the asset. We estimate the fair value of our customer relationships and lists using the distributor method income approach which is based upon a DCF Model. The distributor method uses financial margin information for distributors within the applicable industry and most representative of the Company to estimate a royalty rate. The determination of fair value using these methods entails a significant number of estimates and assumptions, which require management judgment, and include net sales revenue growth rates, discount rates, royalty rates, residual growth rates (as applicable) and customer attrition rates (as applicable). We use internal forecasts and strategic long-term plans to estimate net sales revenue growth rates and royalty rates. We utilize a constant growth model to determine the residual growth rates which are based upon long-term industry growth expectations and long-term expected inflation. Accordingly, this fair value measurement is classified as Level 3 since it is based primarily upon unobservable inputs that reflect management’s assumptions. The most significant unobservable input (Level 3) used to estimate the fair value of our indefinite-lived intangible assets and our definite-lived intangible assets as of August 31, 2025 was a royalty rate that ranged from 1.1% to 5.5%.

For additional information regarding the testing and analysis performed, refer to Note 5 and “Critical Accounting Policies and Estimates” in Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

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Note 12 - Financial Instruments and Risk Management

Foreign Currency Risk

The U.S. Dollar is the functional currency for the Company and all of its subsidiaries and is also the reporting currency for the Company. By operating internationally, we are subject to foreign currency risk from transactions denominated in currencies other than the U.S. Dollar (“foreign currencies”). Such transactions include sales and operating expenses. As a result of such transactions, portions of our cash, accounts receivable and accounts payable are denominated in foreign currencies. Approximately 14% and 15% of our net sales revenue was denominated in foreign currencies during the three and six months ended August 31, 2025, respectively, compared to 12% and 14% for the same periods last year, respectively. These sales were primarily denominated in Euros, Canadian Dollars and British Pounds. We make most of our inventory purchases from manufacturers in Asia and primarily use the U.S. Dollar for such purchases.

In our condensed consolidated statements of (loss) income, foreign currency exchange rate gains and losses resulting from the remeasurement of foreign income tax receivables and payables and deferred income tax assets and liabilities are recognized in income tax (benefit) expense, and all other foreign currency exchange rate gains and losses are recognized in SG&A. During the three and six months ended August 31, 2025, we recorded foreign currency exchange rate net gains of $2.9 million and $9.5 million, respectively, in income tax expense, compared to net losses of $0.2 million and $0.3 million for the same periods last year, respectively. During the three and six months ended August 31, 2025, we recorded foreign currency exchange rate net gains of $0.4 million and $2.1 million, respectively, in SG&A, compared to $0.6 million for both the same periods last year. We mitigate certain foreign currency exchange rate risk by using forward contracts to protect against the foreign currency exchange rate risk inherent in our transactions denominated in foreign currencies. We do not enter into any derivatives or similar instruments for trading or other speculative purposes. Certain of our forward contracts are designated as cash flow hedges (“foreign currency contracts”) and are recorded on the balance sheet at fair value with changes in fair value recorded in Other Comprehensive Loss (“OCI”) until the hedge transaction is settled, at which point amounts are reclassified from Accumulated Other Comprehensive (Loss) Income (“AOCI”) to our condensed consolidated statements of (loss) income. Foreign currency derivatives for which we have not elected hedge accounting consist of certain forward contracts, and any changes in the fair value of these derivatives are recorded in our condensed consolidated statements of (loss) income. These undesignated derivatives are used to hedge monetary net asset and liability positions. Cash flows from our foreign currency derivatives are classified as cash flows from operating activities in our condensed consolidated statements of cash flows, which is consistent with the classification of the cash flows from the underlying hedged item. We evaluate our derivatives designated as cash flow hedges each quarter to assess hedge effectiveness.

Interest Rate Risk

Interest on our outstanding debt as of August 31, 2025 and February 28, 2025 is based on floating interest rates. If short-term interest rates increase, we will incur higher interest expense on any future outstanding balances of floating rate debt. Floating interest rates are hedged with interest rate swaps to effectively fix interest rates on a portion of our outstanding principal balance under the Credit Agreement, which totaled $898.6 million and $921.9 million as of August 31, 2025 and February 28, 2025, respectively. As of August 31, 2025 and February 28, 2025, $625 million and $550 million of the outstanding principal balance under the Credit Agreement, respectively, was hedged with interest rate swaps to fix the interest rate we pay. Our interest rate swaps are designated as cash flow hedges and are recorded on the balance sheet at fair value with changes in fair value recorded in OCI until the hedge transaction is settled, at which point amounts are reclassified from AOCI to our condensed consolidated statements of (loss) income. Cash flows from our interest rate swaps are classified as cash flows from

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operating activities in our condensed consolidated statements of cash flows, which is consistent with the classification of the cash flows from the underlying hedged item. We evaluate our derivatives designated as cash flow hedges each quarter to assess hedge effectiveness.

The following tables summarize the fair values of our derivative instruments as of the end of the periods presented:


(in thousands)	August 31, 2025
Derivatives designated as hedging instruments	Hedge Type	Final Settlement Date	Notional Amount		Prepaid Expenses and Other Current Assets		Other Assets		Accrued Expenses and Other Current Liabilities		Other Liabilities, Non- Current

Forward contracts - sell Euro	Cash flow	8/2027	€	98,300	$	20	$	65	$	4,105	$	506
Forward contracts - sell Canadian Dollars	Cash flow	2/2027	$	46,800	6		14		619		181
Forward contracts - sell Pounds	Cash flow	12/2027	£	44,975	—		24		1,462		717



Forward contracts - sell Norwegian Kroner	Cash flow	2/2027	kr	33,500	8		2		57		10
Interest rate swaps (1)	Cash flow	8/2027	$	725,000	604		139		106		—
Subtotal					638		244		6,349		1,414

Derivatives not designated under hedge accounting


Forward contracts - sell Euro	(2)	9/2025	€	3,475	10		—		—		—
Forward contracts - buy Pounds	(2)	9/2025	£	9,000	—		—		35		—
Subtotal					10		—		35		—
Total fair value					$	648	$	244	$	6,384	$	1,414


(in thousands)	February 28, 2025
Derivatives designated as hedging instruments	Hedge Type	Final Settlement Date	Notional Amount		Prepaid Expenses and Other Current Assets		Other Assets		Accrued Expenses and Other Current Liabilities		Other Liabilities Non- Current

Forward contracts - sell Euro	Cash flow	2/2026	€	35,000	$	1,266	$	—	$	—	$	—
Forward contracts - sell Canadian Dollars	Cash flow	2/2026	$	8,000	38		—		—		—

Forward contracts - sell Pounds	Cash flow	2/2026	£	24,950	788		—		99		—


Forward contracts - sell Norwegian Kroner	Cash flow	8/2025	kr	10,000	71		—		—		—
Interest rate swaps	Cash flow	8/2026	$	550,000	763		302		221		—
Subtotal					2,926		302		320		—

Derivatives not designated under hedge accounting
Forward contracts - sell Euro	(2)	3/2025	€	680	—		—		2		—
Forward contracts - sell Pounds	(2)	3/2025	£	1,280	—		—		18		—
Subtotal					—		—		20		—
Total fair value					$	2,926	$	302	$	340	$	—

(1)Includes a forward-starting interest rate swap agreement with a notional amount of $100 million that becomes effective on March 1, 2026.

(2)These forward contracts, for which we have not elected hedge accounting, hedge monetary net asset and liability positions for the notional amounts reported, creating an economic hedge against currency movements.

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The pre-tax effects of derivative instruments designated as cash flow hedges were as follows for the periods presented:


	Three Months Ended August 31,
	Loss Recognized in AOCI				Gain (Loss) Reclassified from AOCI into Income
(in thousands)	2025		2024		Location	2025		2024
Foreign currency contracts - cash flow hedges	$	(2,368)	$	(1,317)	Sales revenue, net	$	(1,770)	$	(193)
Interest rate swaps - cash flow hedges	(743)		(3,535)		Interest expense	1,149		965


Total	$	(3,111)	$	(4,852)		$	(621)	$	772


	Six Months Ended August 31,
	Gain (Loss) Recognized in AOCI				Gain (Loss) Reclassified from AOCI into Income
(in thousands)	2025		2024		Location	2025		2024
Foreign currency contracts - cash flow hedges	$	(12,075)	$	(1,425)	Sales revenue, net	$	(2,493)	$	(9)
Interest rate swaps - cash flow hedges	1,870		(1,243)		Interest expense	2,077		2,049


Total	$	(10,205)	$	(2,668)		$	(416)	$	2,040

The pre-tax effects of derivative instruments not designated under hedge accounting were as follows for the periods presented:


	Gain (Loss) Recognized in Income
		Three Months Ended August 31,				Six Months Ended August 31,
(in thousands)	Location	2025		2024		2025		2024
Forward contracts	SG&A	$	(169)	$	66	$	(505)	$	88


Total		$	(169)	$	66	$	(505)	$	88

We expect a net loss of $5.7 million associated with foreign currency contracts and interest rate swaps currently recorded in AOCI to be reclassified into income over the next twelve months. The amount ultimately realized, however, will differ as exchange rates and interest rates change and the underlying contracts settle. See Notes 11 and 13 for more information.

Counterparty Credit Risk

Financial instruments, including foreign currency contracts, forward contracts, and interest rate swaps, expose us to counterparty credit risk for non-performance. We manage our exposure to counterparty credit risk by only dealing with counterparties who are substantial international financial institutions with significant experience using such derivative instruments. We believe that the risk of incurring credit losses is remote.

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Note 13 - Accumulated Other Comprehensive Income (Loss)

The changes in AOCI by component and related tax effects for the periods presented were as follows:


(in thousands)	Interest Rate Swaps		Foreign Currency Contracts		Total
Balance at February 29, 2024	$	1,917	$	182	$	2,099
Other comprehensive loss before reclassification	(1,243)		(1,425)		(2,668)
Amounts reclassified out of AOCI	(2,049)		9		(2,040)
Tax effects	771		323		1,094
Other comprehensive loss	(2,521)		(1,093)		(3,614)
Balance at August 31, 2024	$	(604)	$	(911)	$	(1,515)

Balance at February 28, 2025	$	646	$	1,632	$	2,278
Other comprehensive income (loss) before reclassification	1,870		(12,075)		(10,205)
Amounts reclassified out of AOCI	(2,077)		2,493		416
Tax effects	50		2,000		2,050
Other comprehensive loss	(157)		(7,582)		(7,739)
Balance at August 31, 2025	$	489	$	(5,950)	$	(5,461)

See Notes 11 and 12 for additional information regarding our cash flow hedges.

Note 14 - Segment and Geographic Information

Segment Information

We operate through two strategic business divisions, each comprised of operating segments organized by our brands and product lines. Operating segments with similar economic and qualitative characteristics are aggregated into our two reportable segments, which align with our strategic business divisions. Our two reportable segments consist of Home & Outdoor and Beauty & Wellness. For additional information on our segments refer to Note 1.

Segment financial information is prepared in accordance with GAAP and our significant accounting policies described in Note 1 of our Form 10-K. Resources are allocated and performance is assessed using segment operating income by our Chief Executive Officer, whom we have determined to be our Chief Operating Decision Maker (“CODM”). Our CODM utilizes segment operating income when making decisions about allocating capital and personnel to the segments, predominantly in the annual budget and quarterly forecasting processes. In addition, our CODM uses operating income, including comparison of actual results to budget and forecast, in assessing the performance of each segment and in evaluating product pricing, distribution strategies and marketing investments. Our CODM reviews balance sheet information at a consolidated level. We compute segment operating income based on net sales revenue, less cost of goods sold, SG&A, asset impairment charges and restructuring charges. The SG&A used to compute each segment’s operating income is directly associated with the segment, plus shared services and corporate overhead expenses that are allocable to the segment. We do not allocate non-operating income and expense, including interest or income taxes, to operating segments.

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The following tables summarize reportable segment information with a reconciliation to our condensed consolidated results for the periods presented:


	Three Months Ended August 31, 2025
(in thousands)	Home & Outdoor		Beauty & Wellness (1)		Total
Sales revenue, net	$	208,721	$	223,060	$	431,781
Less: (2)
Cost of goods sold	108,636		132,464		241,100
Operating expense (3)	172,663		333,735		506,398
Operating loss	$	(72,578)	$	(243,139)	$	(315,717)
Non-operating income, net					249
Interest expense					14,221
Loss before income tax					$	(329,689)


	Three Months Ended August 31, 2024
(in thousands)	Home & Outdoor		Beauty & Wellness		Total
Sales revenue, net	$	241,944	$	232,277	$	474,221
Less: (2)
Cost of goods sold	117,641		140,510		258,151
Operating expense (3)	93,151		88,067		181,218
Operating income	$	31,152	$	3,700	$	34,852
Non-operating income, net					170
Interest expense					13,216
Income before income tax					$	21,806


	Six Months Ended August 31, 2025
(in thousands)	Home & Outdoor		Beauty & Wellness (1)		Total
Sales revenue, net	$	386,704	$	416,732	$	803,436
Less: (2)
Cost of goods sold	198,529		239,215		437,744
Operating expense (3)	474,546		613,901		1,088,447
Operating loss	$	(286,371)	$	(436,384)	$	(722,755)
Non-operating income, net					557
Interest expense					28,029
Loss before income tax					$	(750,227)


	Six Months Ended August 31, 2024
(in thousands)	Home & Outdoor		Beauty & Wellness		Total
Sales revenue, net	$	440,403	$	450,665	$	891,068
Less: (2)
Cost of goods sold	211,867		260,052		471,919
Operating expense (3)	181,534		172,000		353,534
Operating income	$	47,002	$	18,613	$	65,615
Non-operating income, net					270
Interest expense					25,759
Income before income tax					$	40,126

(1)The three and six months ended August 31, 2025 include a full three and six months, respectively, of operating results from Olive & June, acquired on December 16, 2024. For additional information see Note 4.

(2)These significant expense categories and amounts align with the reportable segment information that is regularly provided to the CODM.

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(3)Operating expense for both reportable segments includes SG&A expense. Operating expense during the three and six months ended August 31, 2025 includes asset impairment charges of $326.4 million and $740.8 million, respectively, of which $85.5 million and $304.6 million was recognized in our Home & Outdoor segment, respectively, and $240.9 million and $436.1 million was recognized in our Beauty & Wellness segment, respectively. Operating expense during the three months ended August 31, 2025 and three and six months ended August 31, 2024 also includes restructuring charges. See Note 5 for further information on the asset impairment charges.

The following tables summarize reportable segment information for the periods presented:


	Three Months Ended August 31, 2025
(in thousands)	Home & Outdoor		Beauty & Wellness (1)		Total
Capital and intangible asset expenditures	$	6,907	$	4,563	$	11,470
Depreciation and amortization	6,040		6,820		12,860
Non-cash share-based compensation	4,248		5,124		9,372
Asset impairment charges	85,537		240,857		326,394


	Three Months Ended August 31, 2024
(in thousands)	Home & Outdoor		Beauty & Wellness		Total
Capital and intangible asset expenditures	$	1,722	$	3,162	$	4,884
Depreciation and amortization	6,590		7,202		13,792
Non-cash share-based compensation	2,814		2,673		5,487


	Six Months Ended August 31, 2025
(in thousands)	Home & Outdoor		Beauty & Wellness (1)		Total
Capital and intangible asset expenditures	$	13,890	$	10,942	$	24,832
Depreciation and amortization	12,599		14,345		26,944
Non-cash share-based compensation	4,282		5,386		9,668
Asset impairment charges	304,632		436,147		740,779


	Six Months Ended August 31, 2024
(in thousands)	Home & Outdoor		Beauty & Wellness		Total
Capital and intangible asset expenditures	$	7,467	$	6,559	$	14,026
Depreciation and amortization	13,237		14,391		27,628
Non-cash share-based compensation	5,827		5,493		11,320

Geographic Information

The following table presents net sales revenue by geographic region, in U.S. Dollars:


	Three Months Ended August 31,								Six Months Ended August 31,
(in thousands)	2025				2024				2025				2024
Domestic sales revenue, net (1)	$	330,496	76.5	%	$	365,750	77.1	%	$	608,456	75.7	%	$	666,430	74.8	%
International sales revenue, net	101,285		23.5	%	108,471		22.9	%	194,980		24.3	%	224,638		25.2	%
Total sales revenue, net	$	431,781	100.0	%	$	474,221	100.0	%	$	803,436	100.0	%	$	891,068	100.0	%

(1)Domestic net sales revenue includes net sales revenue from the U.S. and Canada.

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Note 15 - Income Taxes

We reorganized the Company in Bermuda in 1994, and many of our foreign subsidiaries are not directly or indirectly owned by a U.S. parent. As such, a significant portion of our foreign income is not subject to U.S. taxation on a permanent basis under current law. Additionally, our intangible assets are primarily owned by foreign affiliates, resulting in proportionally higher earnings in jurisdictions with statutory tax rates lower than the U.S. Taxable income in each jurisdiction, whether U.S. or foreign, is determined by the subsidiary’s operating results as well as applicable transfer pricing and tax regulations.

In July 2025, a reconciliation bill, commonly referred to as the One Big Beautiful Bill Act, was signed into law. The legislation includes a broad range of U.S. tax reform provisions. We are evaluating the impact of these provisions; however, there were no discrete effects in the second quarter and we do not expect a material impact on our fiscal 2026 consolidated financial statements.

The Organisation for Economic Co-operation and Development (“OECD”) has introduced a framework to implement a global minimum corporate income tax of 15%, referred to as “Pillar Two.” Certain countries in which we operate have enacted, or are in process of enacting, domestic legislation aligned with OECD’s Pillar Two “Model Rules.” Pillar Two legislation in effect for our fiscal 2025 and 2026 has been incorporated into our financial statements.

In June 2025, the Group of Seven, comprised of Canada, France, Germany, Italy, Japan, the United Kingdom and the U.S., announced an agreement under which U.S. multinational companies would be excluded from certain elements of the Pillar Two global minimum tax rules in exchange for the U.S. withdrawing planned retaliatory tax measures. This agreement has not yet been formally incorporated into the OECD Pillar Two Model Rules. We will continue to monitor the potential implications of this development, as it may influence the broader application of the Pillar Two Model Rules globally.

In the fourth quarter of fiscal 2025, we implemented a reorganization involving the transfer of intangible assets previously held by Helen of Troy Limited (Barbados) to our subsidiary in Switzerland. The reorganization resulted in the consolidation of the ownership of intangible assets, supporting streamlined internal licensing and centralized management of the intangible assets. Further, the reorganization resulted in a transitional income tax benefit of $64.6 million from the recognition of a deferred tax asset, partially offset by taxes associated with the transfer.

In response to Pillar Two, on May 24, 2024, Barbados enacted a domestic corporate income tax rate of 9%, effective for our fiscal 2025 and a domestic minimum top-up tax (“DMTT”) of 15% which was effective beginning with our fiscal 2026. During the first quarter of fiscal 2025, we incorporated the corporate income tax into our estimated annual effective tax rate and revalued our existing deferred tax liabilities subject to the Barbados legislation, which resulted in a discrete tax charge of $6.0 million. However, as a result of the reorganization of our intangible assets described above, the Barbados corporate income tax and DMTT will not have a material impact on our condensed consolidated financial statements beginning in fiscal 2026.

Like Barbados, the government of Bermuda enacted a 15% corporate income tax that was effective for us beginning in fiscal 2026. This Bermuda tax will not have a material impact on our condensed consolidated financial statements.

We expect our fiscal 2026 effective tax rate, excluding discrete items and asset impairment charges described below and in Note 5, to increase relative to historical periods due to the impact of global tax reform initiatives, including the implementation of Pillar Two and economic substance regulations. As additional jurisdictions implement or revise legislation in response to these reforms, we may experience further adverse impacts on our global effective tax rate.

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For interim periods, our income tax expense and resulting effective tax rate are based on an estimated annual effective tax rate, adjusted for the impact of discrete items recognized in the period. Discrete items include changes in tax laws or rates, changes in estimates for uncertain tax positions, excess tax benefits or deficiencies from stock-based compensation, foreign currency remeasurement effects that are not reasonably estimable, and other infrequent or non-recurring items. Discrete items do not include the asset impairment charges described below and in Note 5.

During the three and six months ended August 31, 2025, we recognized goodwill and other intangible asset impairment charges of $326.4 million and $740.8 million, respectively, which included $246.0 million and $511.0 million, respectively, of non-deductible goodwill that will not result in a tax benefit. The expected tax benefit of $38.0 million on the year-to-date impairment charges will be recognized over the course of the fiscal year in relation to pre-tax book income, rather than as a discrete item in the periods in which the charges were incurred.

The downward revisions to our internal forecasts utilized in our impairment testing during fiscal 2026 impacted our assessment of the future realizability of a related deferred tax asset, which led to the recording of a $13.5 million and $30.0 million valuation allowance during the three and six months ended August 31, 2025, respectively.

For the three months ended August 31, 2025, the income tax benefit as a percentage of loss before income tax was 6.4%, compared to an income tax expense as a percentage of income before income tax of 22.0% for the same period last year. The decrease in the effective tax rate is primarily due to the impairment charges in fiscal 2026 and the related tax effects described above, and increases in tax benefits for discrete items, partially offset by valuation allowances on intangible asset deferred tax assets.

For the six months ended August 31, 2025, the income tax expense as a percentage of loss before income tax was (1.2)%, compared to an income tax expense as a percentage of income before income tax of 42.1% for the same period last year. The decrease in the effective tax rate is primarily due to the impairment charges in fiscal 2026 and the related tax effects described above, increases in tax benefits for discrete items in fiscal 2026 and the comparative impact of tax expense recognized during the first quarter of fiscal 2025 as a result of the Barbados tax legislation, partially offset by valuation allowances on intangible asset deferred tax assets.

Note 16 - Earnings Per Share

We compute basic earnings per share using the weighted average number of shares of common stock outstanding during the period. We compute diluted earnings per share using the weighted average number of shares of common stock outstanding plus the effect of dilutive securities. Dilutive securities at any given point in time may consist of outstanding options to purchase common stock and issued and contingently issuable unvested restricted stock units, performance stock units, restricted stock awards and performance restricted stock awards and other stock-based awards. Anti-dilutive securities are not included in the computation of diluted earnings per share under the treasury stock method. See Note 6 to these condensed consolidated financial statements for more information regarding stock-based awards.

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The following table presents our weighted average basic and diluted shares outstanding for the periods shown:


	Three Months Ended August 31,		Six Months Ended August 31,
(in thousands)	2025	2024	2025	2024
Weighted average shares outstanding, basic	22,959	22,814	22,951	23,169
Incremental shares from share-based compensation arrangements	—	25	—	67
Weighted average shares outstanding, diluted (1)	22,959	22,839	22,951	23,236



Anti-dilutive securities	454	155	442	140

(1)Due to the net loss for the three and six months ended August 31, 2025, 53 thousand and 41 thousand incremental shares, respectively, from share-based compensation arrangements were excluded from the computation of diluted weighted average shares outstanding because their effect would be anti-dilutive.

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

This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with our condensed consolidated financial statements included under Item 1., “Financial Statements.” The various sections of this MD&A contain a number of forward-looking statements, all of which are based on our current expectations. Actual results may differ materially due to a number of factors, including those discussed in the section entitled “Information Regarding Forward-Looking Statements” following this MD&A, and in Item 3., “Quantitative and Qualitative Disclosures About Market Risk” in this report, as well as in Part I, Item IA., “Risk Factors” in the Company’s most recent annual report on Form 10-K for the fiscal year ended February 28, 2025 (“Form 10-K”) and its other filings with the Securities and Exchange Commission (the “SEC”). When used in this MD&A, unless otherwise indicated or the context suggests otherwise, references to “the Company”, “our Company”, “Helen of Troy”, “we”, “us”, or “our” refer to Helen of Troy Limited and its subsidiaries. References to “fiscal” in connection with a numeric year number denotes our fiscal year ending on the last day of February, during the year number listed.

This MD&A, including the tables under the headings “Operating (Loss) Income, Operating Margin, Adjusted Operating Income (non-GAAP), and Adjusted Operating Margin (non-GAAP) by Segment” and “Net (Loss) Income, Diluted (Loss) Earnings Per Share, Adjusted Income (non-GAAP), and Adjusted Diluted Earnings Per Share (non-GAAP),” reports operating (loss) income, operating margin, net (loss) income and diluted (loss) earnings per share without the impact of asset impairment charges, a discrete tax charge to revalue existing deferred tax liabilities due to Barbados enacting domestic corporate income tax legislation (“Barbados tax reform”), costs incurred in connection with the departure of our former Chief Executive Officer (“CEO”) primarily related to severance and recruitment costs (“CEO succession costs”), income tax expense from the recognition of a valuation allowance on a deferred tax asset related to our intangible asset reorganization in fiscal 2025 (“intangible asset reorganization”), restructuring charges, amortization of intangible assets, and non-cash share-based compensation for the periods presented, as applicable. These measures may be considered non-GAAP financial measures as defined by SEC Regulation G, Rule 100. The tables reconcile these measures to their corresponding GAAP-based financial measures presented in our condensed consolidated statements of (loss) income. We believe that adjusted operating income, adjusted operating margin, adjusted income, and adjusted diluted earnings per share provide useful information to management and investors regarding financial and business trends relating to our financial condition and results of operations. We believe that these non-GAAP financial measures, in combination with our financial results calculated in accordance with GAAP, provide investors with additional perspective regarding the impact of such charges and benefits on applicable income, margin and earnings per share measures. We also believe that these non-GAAP measures reflect the operating performance of our business and facilitate a more direct comparison of our performance to our competitors. The material limitation associated with the use of the non-GAAP financial measures is that the non-GAAP measures do not reflect the full economic impact of our activities. Our adjusted operating income, adjusted operating margin, adjusted income, and adjusted diluted earnings per share are not prepared in accordance with GAAP, are not an alternative to GAAP financial measures and may be calculated differently than non-GAAP financial measures disclosed by other companies. Accordingly, undue reliance should not be placed on non-GAAP financial measures. These non-GAAP financial measures are discussed further and reconciled to their applicable GAAP-based financial measures contained in this MD&A beginning on page 46.

There were no material changes to the key financial measures discussed in our Form 10-K.

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Overview

We incorporated as Helen of Troy Corporation in Texas in 1968 and were reorganized as Helen of Troy Limited in Bermuda in 1994. We are a leading global consumer products company offering creative products and solutions for our customers through a diversified portfolio of brands. Our portfolio of brands includes OXO, Hydro Flask, Osprey, Vicks, Braun, Honeywell, PUR, Hot Tools, Drybar, Curlsmith, Revlon and Olive & June, among others. We have built leading market positions through new product innovation, product quality and competitive pricing. As of August 31, 2025, we operated two reportable segments: Home & Outdoor and Beauty & Wellness.

As previously disclosed in our SEC filings, on May 2, 2025, Noel Geoffroy departed the Company as CEO, and the Board of Directors appointed Brian Grass as the Company’s interim CEO. Effective September 1, 2025, the Board of Directors appointed G. Scott Uzzell as the Company’s new CEO, and Mr. Grass transitioned back to his role as Chief Financial Officer at that time.

During the first and second quarters of fiscal 2026, we concluded a goodwill impairment triggering event had occurred due to a sustained decline in our stock price, and performed quantitative impairment testing on our goodwill and certain intangible assets. As a result of such testing, we recorded pre-tax asset impairment charges as follows:


(in thousands)	Three Months Ended August 31, 2025		Six Months Ended August 31, 2025
Home & Outdoor (1)	$	85,537	$	304,632
Beauty & Wellness (2)	240,857		436,147
Total	$	326,394	$	740,779

For additional information regarding the testing and analysis performed, refer to “Critical Accounting Policies and Estimates” in this Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

On December 16, 2024, we completed the acquisition of Olive & June, LLC (“Olive & June”), an innovative, omni-channel nail care brand. Olive & June products deliver a salon-quality experience at home and include nail polish, press-on nails, manicure and pedicure systems, grooming tools and nail care essentials. The Olive & June brand and products were added to the Beauty & Wellness segment. The total purchase consideration consists of initial cash consideration of $224.7 million, which is net of cash acquired and a favorable post-closing adjustment of $3.9 million, and contingent cash consideration of up to $15.0 million subject to Olive & June’s performance during calendar years 2025, 2026 and 2027, payable annually. The acquisition of Olive & June complements and broadens our existing Beauty portfolio beyond the hair care category and advances our strategy to deploy accretive capital that leverages our capabilities and scale to accelerate growth, further expand margins, and drive greater earnings growth and free cash flow conversion.

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Significant Trends Impacting the Business

Impact of Tariffs

Since 2019, the Office of the United States Trade Representative (“USTR”) has imposed additional tariffs on products imported from China. Additionally, the current United States (“U.S.”) presidential administration has promoted and implemented plans to raise tariffs even further and pursue other trade policies intended to restrict imports. Our purchases of products from unaffiliated manufacturers located in China and other regions exposes us to higher costs of doing business from increases in tariffs.

Under the International Emergency Economic Powers Act (“IEEPA”), the U.S. presidential administration began implementing fentanyl-related IEEPA tariffs (“Fentanyl IEEPA Tariff”) and additional tariffs (“Reciprocal IEEPA Tariff”) during calendar year 2025. As of April 9, 2025, the U.S. had imposed (i) an aggregate additional 145% tariff on imports from China, consisting of a 20% Fentanyl IEEPA Tariff and 125% Reciprocal IEEPA Tariff and (ii) a global 10% Reciprocal IEEPA Tariff on imports from other countries including Mexico, Vietnam and other U.S. trading partners. The Reciprocal IEEPA Tariff on imports from China was subsequently lowered to 10% effective May 12, 2025, resulting in an aggregate additional 30% tariff. The current 10% Reciprocal IEEPA Tariff on imports from China is scheduled to expire on November 10, 2025 and could revert to the previously specified tariff rate of 125% if a trade agreement is not reached. On July 31, 2025, the U.S. president signed an executive order imposing new IEEPA tariffs on a number of U.S. trading partners which became effective on August 7, 2025, including a 25% Fentanyl IEEPA Tariff on imports from Mexico and a 20% and 19% Reciprocal IEEPA Tariff on imports from Vietnam and Thailand, respectively. However, we do not currently incur any Fentanyl IEEPA Tariffs on our imports manufactured in Mexico since they qualify for duty-free preference under the United States-Mexico-Canada Agreement. Further, we benefit from certain exclusions from tariffs as a result of the COVID-19 pandemic, which have been extended to November 29, 2025.

In March 2025, the U.S. president also implemented changes under Section 232 of the Trade Expansion Act of 1962 (“Section 232 Tariffs”) which resulted in additional sectoral tariffs to aluminum and steel of 25%. On June 4, 2025, the Section 232 Tariffs related to aluminum and steel were increased to 50%, and effective August 1, 2025, expanded to include copper products and components. Currently, our products are not subject to the Section 232 Tariffs on copper products and components. Our products are subject to (i) a 50% Section 232 Tariff on the aluminum and steel content of components, which primarily impacts certain products within our Home and Wellness businesses and (ii) the Fentanyl IEEPA Tariff and any other applicable Reciprocal IEEPA Tariff or Section 301 (defined below) tariff on other components. In addition, the U.S. presidential administration is considering additional tariffs as a remedy for unfair trade practices under Section 301 of the Trade Act of 1974 (“Section 301”); however, no official Section 301 tariffs have been published since the review process is ongoing.

The U.S. tariff policies are continuing to evolve, as well as the corresponding impacts on global trade policies. As a result, our risks and mitigation plans, as further described below, will also continue to evolve as further developments arise. Any alteration of trade agreements and terms between China and the U.S., including limiting trade with China, imposing additional tariffs on imports from China, and potentially imposing other restrictions on imports from China to the U.S. may result in further or higher tariffs or retaliatory trade measures by China.

We are continuing to assess our incremental tariff cost exposure in light of continuing changes to global tariff policies and the full extent of our potential mitigation plans, as well as the associated timing to implement such plans. To mitigate our risk of ongoing exposure to tariffs, we have initiated significant efforts to diversify our production outside of China into regions where we expect tariffs or overall costs to be lower and to source the same product in more than one region, to the extent it is possible and not cost-prohibitive. We are also continuing to implement other mitigation actions, which include cost reductions from suppliers and price increases to customers on products subject to tariffs. In addition to

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the uncertainty from evolving global tariff policies, we expect unfavorable cascading impacts on inflation, consumer confidence, employment, and overall macroeconomic conditions, all of which may adversely impact our sales, results of operations and cash flows.

Our cost of goods sold during the three and six months ended August 31, 2025 included $9.0 million and $10.5 million, respectively, of additional pre-tax costs related to the changes in tariffs described above. Net sales revenue during the first six months of fiscal 2026 was also negatively impacted by a combination of factors including the pause or cancellation of direct import orders from China by key retailers in response to increased tariff rates, a slowdown in retailer orders following pull forward activity in the fourth quarter of fiscal 2025 due to tariff uncertainty, and lower consumer confidence and demand. Sales were also negatively impacted by evolving dynamics in the China market, including a shift toward localized fulfillment models and heightened competition from domestic sellers benefiting from government subsidies.

In the first quarter of fiscal 2026, we adjusted our measures to reduce costs and preserve cash flow as the environment continued to evolve. While we resumed targeted growth investments during the second quarter of fiscal 2026, we remain disciplined in our approach given continued tariff volatility. The measures in place continue to include the following:

•Suspension of projects and capital expenditures that are not critical or in support of supplier diversification or dual sourcing initiatives;

•Actions to reduce overall personnel costs and pause most project and travel expenses remain in place;

•A resumption of optimized marketing, promotional and new product development investments focused on opportunities with the highest returns;

•A resumption of targeted inventory purchases from China in the short term, with a measured approach in expectation of softer consumer demand in the short to intermediate term; and

•Actions to optimize working capital and balance sheet productivity.

Impact of Macroeconomic Trends

The Federal Open Market Committee lowered the benchmark interest rate by 75 basis points and 25 basis points during the third and fourth quarters of fiscal 2025, respectively, resulting in lower average interest rates incurred during the first six months of fiscal 2026 compared to the same period last year. The Federal Open Market Committee lowered the benchmark interest rate by 25 basis points subsequent to the second quarter of fiscal 2026. As of August 31, 2025 and February 28, 2025, $625 million and $550 million of the outstanding principal balance under the Credit Agreement (as defined below), respectively, was hedged with interest rate swaps to fix the interest rate we pay. While the actual timing and extent of additional future changes in interest rates remains unknown, lower average interest rates would reduce interest expense on our outstanding variable rate debt not subject to the interest rate swaps. The financial markets, the global economy and global supply chain may also be adversely affected by the current or anticipated impact of military conflicts or other geopolitical events, as well as recent U.S. tariff policies, that are continuing to evolve and the corresponding impacts on global trade. High inflation and interest rates have also negatively impacted consumer disposable income, credit availability and spending, among others, which have adversely impacted our business, financial condition, cash flows and results of operations during fiscal 2025 and the first six months of fiscal 2026 and may continue to have an adverse impact during the remainder of fiscal 2026. The evolving global tariff policies could adversely impact inflation and interest rates which could further negatively impact consumer disposable income, credit availability and spending. See further discussion below under “Consumer Spending and Changes in Shopping Preferences.” We expect continued uncertainty in our business and the global economy due to pressure from inflation, tariffs and consumer confidence, any of which may adversely impact our results.

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Consumer Spending and Changes in Shopping Preferences

Our business depends upon discretionary consumer demand for most of our products and primarily operates within mature and highly developed consumer markets. The principal driver of our operating performance is the strength of the U.S. retail economy. Approximately 72% and 73% of our consolidated net sales revenue was from U.S. shipments during the three months ended August 31, 2025 and 2024, respectively. For the six months ended August 31, 2025 and 2024, U.S. shipments were approximately 71% and 70% of our consolidated net sales revenue, respectively.

Among other things, high levels of inflation, interest rates and tariffs may negatively impact consumer disposable income, credit availability and spending. Consumer purchases of discretionary items, including some of the products that we offer, generally decline during recessionary periods or periods of economic uncertainty, when disposable income is reduced or when there is a reduction in consumer confidence. Dynamic changes in consumer spending and shopping patterns are also having an impact on retailer inventory levels. Our ability to sell to retailers is predicated on their ability to sell to the end consumer. During fiscal 2025, we experienced reduced replenishment orders from retail customers in line with softer consumer demand and discretionary spending, which adversely impacted our sales, results of operations and cash flows. Additionally, during fiscal 2025 and the first half of fiscal 2026, we experienced increased competition within our Beauty & Wellness segment and in the insulated beverageware category, which led to some declines in retail distribution. During the first half of fiscal 2026, we experienced reduced replenishment orders from retail customers who paused or cancelled orders originating in China in response to the increased tariff rates, as well as broader pressures in the China market related to a shift toward localized fulfillment models and increased competition from government-subsidized domestic sellers. In addition, we continue to experience lower replenishment orders in line with softer consumer demand and discretionary spending and continued competition, which adversely impacted our sales, results of operations and cash flows. If orders from our retail customers continue to be adversely impacted, our sales, results of operations and cash flows may continue to be adversely impacted. We expect continued uncertainty in our business and the global economy due to inflation, evolving global tariff policies, continued competition and changes in consumer spending patterns. Accordingly, our liquidity and financial results could be impacted in ways that we are not able to predict today.

Our concentration of sales reflects the continued evolution of consumer shopping preferences. Our net sales to pure-play online retailers and retail customers fulfilling end-consumer online orders, as well as our own online sales directly to consumers (collectively “online channel net sales”) comprised approximately 24% of our total consolidated net sales revenue for both the three and six months ended August 31, 2025, respectively, and declined approximately 22% and 20% compared to the same periods last year, respectively. For the three and six months ended August 31, 2024, our online channel net sales comprised approximately 29% and 27% of our total consolidated net sales revenue, respectively. Our online channel net sales grew approximately 1% for the three months ended August 31, 2024 and declined approximately 6% for the six months ended August 31, 2024 compared to the same periods last year.

With the continued importance of online sales in the retail landscape, many brick and mortar retailers are aggressively looking for ways to improve their customer delivery capabilities to be able to meet customer expectations. As a result, it has become increasingly important for us to leverage our distribution capabilities in order to meet the changing demands of our customers, including increasing our online capabilities to support our direct-to-consumer sales channels and online channel sales by our retail customers. To meet these needs, we completed the construction of an additional distribution facility in Gallaway, Tennessee that became operational during the first quarter of fiscal 2024. During the first quarter of fiscal 2025, we experienced automation system startup issues at the facility which impacted some of our Home & Outdoor segment’s small retail customer and direct-to-consumer orders. As a result, our sales during the first quarter of fiscal 2025 were adversely impacted due to shipping

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disruptions, and we incurred additional costs and lost efficiency during both the first and second quarters of fiscal 2025 as we worked to remediate the issues. As a result of the remediation efforts performed, the automation system began to operate as designed during the third quarter of fiscal 2025, and we achieved targeted efficiency levels by the end of fiscal 2025.

Additionally, we have invested in a centralized cloud-based e-commerce platform, which most of our brands are currently utilizing. The centralized cloud-based e-commerce platform enables us to leverage a common system and rapidly deploy new capabilities across all of our brands, as well as more easily integrate new brands. We believe this platform enhances the customer experience by strengthening the digital presentation and product browsing capabilities and improving the checkout process, order delivery and post-order customer care.

Project Pegasus

We continue to have the following expectations regarding Project Pegasus savings:

•Targeted annualized pre-tax operating profit improvements of approximately $75 million to $85 million, which began in fiscal 2024 and we expect to be substantially achieved by the end of fiscal 2027.

•Estimated cadence of the recognition of the savings will be approximately 25% and 35% in fiscal 2024 and 2025, respectively, which were both achieved, and approximately 25% and 15% in fiscal 2026 and 2027, respectively.

•Total profit improvements to be realized approximately 60% through reduced cost of goods sold and 40% through lower SG&A.

During both the first and second quarters of fiscal 2025 and 2026, our gross margin and operating margins were favorably impacted by lower commodity and product costs driven by our cost of goods saving projects. Expectations regarding our Project Pegasus initiatives and our ability to realize targeted savings are based on management’s estimates available at the time and are subject to a number of assumptions that could materially impact our estimates.

During the three and six months ended August 31, 2024, we incurred $1.5 million and $3.4 million, respectively, of pre-tax restructuring costs in connection with Project Pegasus. We made total cash restructuring payments related to Project Pegasus of $4.0 million and $5.6 million during the six months ended August 31, 2025 and 2024, respectively, and had a remaining liability of $3.7 million as of August 31, 2025. See Note 8 to the accompanying condensed consolidated financial statements for additional information.

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Water Filtration Patent Litigation

On December 23, 2021, Brita LP filed a complaint against Kaz USA, Inc. and Helen of Troy Limited in the U.S. District Court for the Western District of Texas (the “Patent Litigation”), alleging patent infringement by the Company relating to its PUR gravity-fed water filtration systems. Brita LP simultaneously filed a complaint with the U.S. International Trade Commission (“ITC”) against Kaz USA, Inc., Helen of Troy Limited and five other unrelated companies that sell water filtration systems (the “ITC Action”). The complaint in the ITC Action also alleged patent infringement by the Company with respect to a limited set of PUR gravity-fed water filtration systems. This action sought injunctive relief to prevent entry of certain accused PUR products (and certain other products) into the U.S. and cessation of marketing and sales of existing inventory already in the U.S. On February 28, 2023, the ITC issued an Initial Determination in the ITC Action, tentatively ruling against the Company and the other unrelated respondents. The ITC has a guaranteed review process, and thus all respondents, including the Company, filed a petition with the ITC for a full review of the Initial Determination. On September 19, 2023, the ITC issued its Final Determination in the Company’s favor. The ITC determined there was no violation by the Company and terminated the investigation. Brita LP is appealing the ITC’s decision to the Federal Circuit (“CAFC Appeal”) and filed its Notice of Appeal on October 24, 2023. The Company intervened in the CAFC Appeal and oral argument occurred on August 5, 2025. We are now awaiting the Federal Circuit’s opinion. The Patent Litigation remains stayed for the time being. We cannot predict the outcome of these legal proceedings, the amount or range of any potential loss, when the proceedings will be resolved, or customer acceptance of any replacement water filter. Litigation is inherently unpredictable, and the resolution or disposition of these proceedings could, if adversely determined, have a material and adverse impact on our financial position and results of operations. For additional information regarding the Patent Litigation and the ITC Action, see Note 9 to the accompanying condensed consolidated financial statements.

EPA Compliance Costs

During fiscal 2022 and 2023, we were in discussions with the U.S. Environmental Protection Agency (the “EPA”) regarding the compliance of packaging claims on certain of our products in the air and water filtration categories and a limited subset of humidifier products within the Beauty & Wellness segment that are sold in the U.S. The EPA did not raise any product quality, safety or performance issues. As a result of these packaging compliance discussions, we voluntarily implemented a temporary stop shipment action on the impacted products as we worked with the EPA towards an expedient resolution. We resumed normalized levels of shipping of the affected inventory during fiscal 2022, and we completed the repackaging and relabeling of our existing inventory of impacted products during fiscal 2023. Additionally, as a result of continuing dialogue with the EPA, we executed further repackaging and relabeling plans on certain additional humidifier products and certain additional air filtration products, which were also completed during fiscal 2023. Ongoing settlement discussions with the EPA related to this matter may result in the imposition of fines or penalties in the future. Such potential fines or penalties cannot be reasonably estimated. See Note 9 to the accompanying condensed consolidated financial statements for additional information.

Foreign Currency Exchange Rate Fluctuations

Due to the nature of our operations, we have exposure to the impact of fluctuations in exchange rates from transactions that are denominated in a currency other than our functional currency (the U.S. Dollar). Such transactions include sales and operating expenses. The most significant currencies affecting our operating results are the Euro, Canadian Dollar and British Pound.

For the three months ended August 31, 2025, changes in foreign currency exchange rates had a favorable year-over-year impact on consolidated U.S. Dollar reported net sales revenue of approximately $0.2 million, or less than 0.1%, compared to an unfavorable year-over-year impact of $0.5 million, or 0.1%, for the same period last year. For the six months ended August 31, 2025, changes in foreign currency exchange rates had an unfavorable year-over-year impact on consolidated U.S. Dollar reported

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net sales revenue of approximately $0.8 million, or 0.1%, compared to an unfavorable year-over-year impact of $0.2 million, or less than 0.1%, for the same period last year.

Variability of the Cough/Cold/Flu Season

Sales in several of our Beauty & Wellness segment categories are highly correlated to the severity of winter weather and cough/cold/flu incidence. In the U.S., the cough/cold/flu season historically runs from November through March, with peak activity normally in January to March. The 2024-2025 and 2023-2024 cough/cold/flu seasons were below historical averages seen prior to the impact of COVID-19.

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RESULTS OF OPERATIONS

The following tables provide selected operating data, in U.S. Dollars, as a percentage of net sales revenue, and as a year-over-year percentage change.


	Three Months Ended August 31,								% of Sales Revenue, net
(in thousands)	2025 (1)		2024		$ Change		% Change		2025		2024
Sales revenue by segment, net
Home & Outdoor	$	208,721	$	241,944	$	(33,223)	(13.7)	%	48.3	%	51.0	%
Beauty & Wellness	223,060		232,277		(9,217)		(4.0)	%	51.7	%	49.0	%
Total sales revenue, net	431,781		474,221		(42,440)		(8.9)	%	100.0	%	100.0	%
Cost of goods sold	241,100		258,151		(17,051)		(6.6)	%	55.8	%	54.4	%
Gross profit	190,681		216,070		(25,389)		(11.8)	%	44.2	%	45.6	%
SG&A	176,999		179,692		(2,693)		(1.5)	%	41.0	%	37.9	%
Asset impairment charges	326,394		—		326,394		*		75.6	%	—	%
Restructuring charges	3,005		1,526		1,479		96.9	%	0.7	%	0.3	%
Operating (loss) income	(315,717)		34,852		(350,569)		*		(73.1)	%	7.3	%
Non-operating income, net	249		170		79		46.5	%	0.1	%	—	%
Interest expense	14,221		13,216		1,005		7.6	%	3.3	%	2.8	%
(Loss) income before income tax	(329,689)		21,806		(351,495)		*		(76.4)	%	4.6	%
Income tax (benefit) expense	(21,046)		4,792		(25,838)		*		(4.9)	%	1.0	%


Net (loss) income	$	(308,643)	$	17,014	$	(325,657)	*		(71.5)	%	3.6	%


	Six Months Ended August 31,								% of Sales Revenue, net
(in thousands)	2025 (1)		2024		$ Change		% Change		2025		2024
Sales revenue by segment, net
Home & Outdoor	$	386,704	$	440,403	$	(53,699)	(12.2)	%	48.1	%	49.4	%
Beauty & Wellness	416,732		450,665		(33,933)		(7.5)	%	51.9	%	50.6	%


Total sales revenue, net	803,436		891,068		(87,632)		(9.8)	%	100.0	%	100.0	%
Cost of goods sold	437,744		471,919		(34,175)		(7.2)	%	54.5	%	53.0	%
Gross profit	365,692		419,149		(53,457)		(12.8)	%	45.5	%	47.0	%
SG&A	344,663		350,173		(5,510)		(1.6)	%	42.9	%	39.3	%
Asset impairment charges	740,779		—		740,779		—	%	92.2	%	—	%
Restructuring charges	3,005		3,361		(356)		(10.6)	%	0.4	%	0.4	%
Operating (loss) income	(722,755)		65,615		(788,370)		*		(90.0)	%	7.4	%
Non-operating income, net	557		270		287		*		0.1	%	—	%
Interest expense	28,029		25,759		2,270		8.8	%	3.5	%	2.9	%
(Loss) income before income tax	(750,227)		40,126		(790,353)		*		(93.4)	%	4.5	%
Income tax expense	9,134		16,908		(7,774)		(46.0)	%	1.1	%	1.9	%


Net (loss) income	$	(759,361)	$	23,218	$	(782,579)	*		(94.5)	%	2.6	%

* Calculation is not meaningful.

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Second Quarter Fiscal 2026 Financial Results

•Consolidated net sales revenue decreased 8.9%, or $42.4 million, to $431.8 million for the three months ended August 31, 2025, compared to $474.2 million for the same period last year.

•Consolidated operating loss was $315.7 million for the three months ended August 31, 2025, compared to consolidated operating income of $34.9 million for the same period last year. Consolidated operating loss for the three months ended August 31, 2025 includes pre-tax asset impairment charges of $326.4 million. Consolidated operating margin decreased to (73.1)% of consolidated net sales revenue for the three months ended August 31, 2025, compared to 7.3% for the same period last year.

•Consolidated adjusted operating income decreased 41.9%, or $19.5 million, to $26.9 million for the three months ended August 31, 2025, compared to $46.4 million for the same period last year. Consolidated adjusted operating margin decreased 3.6 percentage points to 6.2% of consolidated net sales revenue for the three months ended August 31, 2025, compared to 9.8% for the same period last year.

•Net loss was $308.6 million for the three months ended August 31, 2025, compared to net income of $17.0 million for the same period last year. Diluted loss per share was $13.44 for the three months ended August 31, 2025, compared to diluted earnings per share of $0.74 for the same period last year.

•Adjusted income decreased 50.8%, or $14.0 million, to $13.5 million for the three months ended August 31, 2025, compared to $27.5 million for the same period last year. Adjusted diluted earnings per share decreased 51.2% to $0.59 for the three months ended August 31, 2025, compared to $1.21 for the same period last year.

Year-To-Date Fiscal 2026 Financial Results

•Consolidated net sales revenue decreased 9.8%, or $87.6 million, to $803.4 million for the six months ended August 31, 2025, compared to $891.1 million for the same period last year.

•Consolidated operating loss was $722.8 million for the six months ended August 31, 2025, compared to consolidated operating income of $65.6 million for the same period last year. Consolidated operating loss for the six months ended August 31, 2025 includes pre-tax asset impairment charges of $740.8 million. Consolidated operating margin decreased to (90.0)% of consolidated net sales revenue for the six months ended August 31, 2025, compared to 7.4% for the same period last year.

•Consolidated adjusted operating income decreased 51.8%, or $46.3 million, to $43.1 million for the six months ended August 31, 2025, compared to $89.4 million for the same period last year. Consolidated adjusted operating margin decreased 4.6 percentage points to 5.4% of consolidated net sales revenue for the six months ended August 31, 2025, compared to 10.0% for the same period last year.

•Net loss was $759.4 million for the six months ended August 31, 2025, compared to net income of $23.2 million for the same period last year. Diluted loss per share was $33.09 for the six months ended August 31, 2025, compared to diluted earnings per share of $1.00 for the same period last year.

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•Adjusted income decreased 54.7%, or $27.9 million, to $23.0 million for the six months ended August 31, 2025, compared to $50.9 million for the same period last year. Adjusted diluted earnings per share decreased 54.3% to $1.00 for the six months ended August 31, 2025, compared to $2.19 for the same period last year.

Consolidated and Segment Net Sales Revenue

The following tables summarize the impact that Organic business, foreign currency and acquisitions had on our net sales revenue by segment:


	Three Months Ended August 31,
(in thousands)	Home & Outdoor			Beauty & Wellness			Total
Fiscal 2025 sales revenue, net	$	241,944		$	232,277		$	474,221
Organic business	(33,805)			(42,267)			(76,072)
Impact of foreign currency	582			(360)			222
Acquisition (1)	—			33,410			33,410
Change in sales revenue, net	(33,223)			(9,217)			(42,440)
Fiscal 2026 sales revenue, net	$	208,721		$	223,060		$	431,781

Total net sales revenue growth (decline)	(13.7)		%	(4.0)		%	(8.9)		%
Organic business	(14.0)		%	(18.2)		%	(16.0)		%
Impact of foreign currency	0.2		%	(0.2)		%	—		%
Acquisition	—		%	14.4		%	7.0		%


	Six Months Ended August 31,
(in thousands)	Home & Outdoor			Beauty & Wellness			Total
Fiscal 2025 sales revenue, net	$	440,403		$	450,665		$	891,068
Organic business	(54,462)			(92,602)			(147,064)
Impact of foreign currency	763			(1,581)			(818)
Acquisition (1)	—			60,250			60,250
Change in sales revenue, net	(53,699)			(33,933)			(87,632)
Fiscal 2026 sales revenue, net	$	386,704		$	416,732		$	803,436

Total net sales revenue growth (decline)	(12.2)		%	(7.5)		%	(9.8)		%
Organic business	(12.4)		%	(20.5)		%	(16.5)		%
Impact of foreign currency	0.2		%	(0.4)		%	(0.1)		%
Acquisition	—		%	13.4		%	6.8		%

In the above tables, Organic business refers to our net sales revenue associated with product lines or brands after the first twelve months from the date the product line or brand was acquired, excluding the impact that foreign currency remeasurement had on reported net sales revenue. Net sales revenue from internally developed brands or product lines is considered Organic business activity.

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Consolidated Net Sales Revenue

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Consolidated net sales revenue decreased $42.4 million, or 8.9%, to $431.8 million, compared to $474.2 million. The decline was driven by a decrease from Organic business of $76.1 million, or 16.0%, primarily due to:

•a decline in Beauty & Wellness due to a decrease in sales of thermometers and heaters primarily due to reduced replenishment and direct import orders from retail customers in Wellness; and lower sales of hair appliances driven by softer consumer demand, increased competition, a net distribution loss year-over-year, and the cancellation of direct import orders from China in Beauty; and

•a decline in Home & Outdoor due to continued competition and a net distribution loss year-over-year in the insulated beverageware category, and lower replenishment orders from retail customers, softer consumer demand and a decrease in club and closeout channel sales in the insulated beverageware and home categories.

These factors were partially offset by strong demand for technical, travel and lifestyle packs in Home & Outdoor.

The Olive & June acquisition contributed $33.4 million, or 7.0%, to consolidated net sales revenue growth. Consolidated net sales revenue was favorably impacted by net foreign currency fluctuations of approximately $0.2 million, or less than 0.1%.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Consolidated net sales revenue decreased $87.6 million, or 9.8%, to $803.4 million, compared to $891.1 million. The decline was driven by a decrease from Organic business of $147.1 million, or 16.5%, primarily due to:

•a decline in Beauty & Wellness due to a decrease in sales of thermometers and fans primarily due to reduced replenishment and direct import orders from retail customers in Wellness, and lower sales of hair appliances driven by softer consumer demand, increased competition, a net distribution loss year-over-year, and the cancellation of direct import orders from China in Beauty; and

•a decline in Home & Outdoor due to continued competition, a net distribution loss year-over-year and a decrease in closeout channel sales in the insulated beverageware category and lower replenishment orders from retail customers, softer consumer demand and a decrease in club channel sales in the insulated beverageware and home categories.

These factors were partially offset by:

•strong demand for technical, travel and lifestyle packs in Home & Outdoor; and

•the favorable comparative impact of shipping disruption at our Tennessee distribution facility due to automation startup issues affecting some of our Home & Outdoor segment’s small retail customer and direct-to-consumer orders during the first quarter of fiscal 2025.

The Olive & June acquisition contributed $60.3 million or 6.8%, to consolidated net sales revenue growth. Consolidated net sales revenue was unfavorably impacted by net foreign currency fluctuations of approximately $0.8 million, or 0.1%.

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Segment Net Sales Revenue

Home & Outdoor

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Net sales revenue decreased $33.2 million, or 13.7%, to $208.7 million, compared to $241.9 million. The decrease was primarily driven by:

•lower replenishment orders from retail customers in the insulated beverageware and home categories, partially due to retailer inventory rebalancing in response to softer demand trends;

•continued competition, a net distribution loss year-over-year and cancellation of direct import orders in response to higher tariffs in the insulated beverageware category;

•a decrease in club channel sales in the insulated beverageware and home categories in response to higher tariffs; and

•lower closeout channel sales.

These factors were partially offset by:

•strong demand for technical, travel and lifestyle packs;

•higher sales from expanded distribution in the home category; and

•incremental sales from a new product launch in the insulated beverageware category.

Segment net sales revenue was favorably impacted by net foreign currency fluctuations of approximately $0.6 million, or 0.2%.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Net sales revenue decreased $53.7 million, or 12.2%, to $386.7 million, compared to $440.4 million. The decrease was primarily driven by:

•softer consumer demand and lower replenishment orders from retail customers, partially due to retailer inventory rebalancing in response to demand trends, in the insulated beverageware and home categories;

•continued competition, a net distribution loss year-over-year, a decrease in closeout channel sales and cancellation of direct import orders in response to higher tariffs in the insulated beverageware category;

•a decrease in club channel sales in the insulated beverageware and home categories in response to higher tariffs, including cancellation of direct import orders; and

•the unfavorable impact of retailer pull-forward activity in the fourth quarter of fiscal 2025 in response to tariff uncertainty and potential supply disruption.

These factors were partially offset by:

•strong demand for technical, travel and lifestyle packs;

•higher sales from expanded distribution in the home category;

•incremental sales from a new product launch in the insulated beverageware category; and

•the favorable comparative impact of shipping disruption at our Tennessee distribution facility due to automation startup issues affecting some of the segment’s small retail customer and direct-to-consumer orders during the first quarter of fiscal 2025.

Segment net sales revenue was favorably impacted by net foreign currency fluctuations of approximately $0.8 million, or 0.2%.

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Beauty & Wellness

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Net sales revenue decreased $9.2 million, or 4.0%, to $223.1 million, compared to $232.3 million. The decrease was primarily driven by a decrease from Organic business of $42.3 million, or 18.2%, primarily due to:

•a decline in thermometry primarily due to evolving dynamics in the China market, including a shift away from cross-border ecommerce toward localized fulfillment models, heightened competition from domestic sellers benefiting from government subsidies, and lower replenishment due to a weaker illness season last year in Asia;

•a decline in Beauty primarily due to softer consumer demand, increased competition, a net distribution loss year-over-year and the cancellation of direct import orders from China in response to higher tariffs;

•a decrease in heater sales driven by reduced direct import orders from China in response to higher tariffs; and

•a decrease in water filtration primarily driven by softer consumer demand and increased competitive promotional activity.

The Olive & June acquisition contributed $33.4 million, or 14.4%, to segment net sales revenue growth. Segment net sales revenue was unfavorably impacted by net foreign currency fluctuations of approximately $0.4 million, or 0.2%.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Net sales revenue decreased $33.9 million, or 7.5%, to $416.7 million, compared to $450.7 million. The decrease was primarily driven by a decrease from Organic business of $92.6 million, or 20.5%, primarily due to:

•a decrease in fan sales primarily driven by reduced replenishment orders from retail customers due to a decline in consumer demand and the cancellation of direct import orders from China in response to higher tariffs;

•a decrease in heater sales driven by reduced direct import orders from China in response to higher tariffs; and

•a decrease in water filtration primarily driven by softer consumer demand and increased competitive promotional activity.

These factors were partially offset by the favorable comparative impact of the shipping disruption from Curlsmith system integration challenges during the first quarter of fiscal 2025.

The Olive & June acquisition contributed $60.3 million, or 13.4%, to segment net sales revenue growth. Segment net sales revenue was unfavorably impacted by net foreign currency fluctuations of approximately $1.6 million, or 0.4%.

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Consolidated Gross Profit Margin

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Consolidated gross profit margin decreased 1.4 percentage points to 44.2%, compared to 45.6%. The decrease in consolidated gross profit margin was primarily due higher retail trade and promotional expense year-over-year and the unfavorable impact of higher tariffs on our cost of goods sold.

These factors were partially offset by the favorable impact of the acquisition of Olive & June within the Beauty & Wellness segment, lower commodity and product costs, partly driven by Project Pegasus initiatives, and favorable inventory obsolescence expense year-over-year.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Consolidated gross profit margin decreased 1.5 percentage points to 45.5%, compared to 47.0%. The decrease in consolidated gross profit margin was primarily due to higher retail trade expense, the impact of tariffs on our cost of goods sold, and unfavorable inventory obsolescence expense year-over-year.

These factors were partially offset by the favorable impact of the acquisition of Olive & June within the Beauty & Wellness segment and lower commodity and product costs, partly driven by Project Pegasus initiatives.

Consolidated SG&A

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Consolidated SG&A ratio increased 3.1 percentage points to 41.0%, compared to 37.9%. The increase in the consolidated SG&A ratio was primarily due to:

•increased share-based compensation expense;

•higher outbound freight costs;

•the impact of the Olive & June acquisition; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

These factors were partially offset by the favorable comparative impact of higher distribution center expense in the prior year period primarily due to additional costs and lost efficiency associated with automation startup issues at our Tennessee distribution facility.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Consolidated SG&A ratio increased 3.6 percentage points to 42.9%, compared to 39.3%. The increase in the consolidated SG&A ratio was primarily due to:

•higher outbound freight costs;

•increased marketing expense;

•the impact of the Olive & June acquisition;

•CEO succession costs of $3.5 million; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

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Asset Impairment Charges

During the three months ended August 31, 2025, we recorded asset impairment charges of $326.4 million ($294.0 million after tax) to reduce our goodwill by $292.6 million and our other intangible assets by $33.8 million. During the six months ended August 31, 2025, we recorded asset impairment charges of $740.8 million ($730.1 million after tax) to reduce our goodwill by $609.6 million and our other intangible assets by $131.2 million. For additional information regarding the testing and analysis performed, refer to “Critical Accounting Policies and Estimates” in this Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

We did not record any asset impairment charges during the first six months of fiscal 2025.

Restructuring Charges

During the second quarter of fiscal 2026, we incurred $3.0 million of pre-tax restructuring charges for severance and employee related costs as a result of personnel reductions outside of the scope of Project Pegasus.

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Operating (Loss) Income, Operating Margin, Adjusted Operating Income (non-GAAP), and Adjusted Operating Margin (non-GAAP) by Segment

In order to provide a better understanding of the impact of certain items on our operating (loss) income, the tables that follow report the comparative pre-tax asset impairment charges, CEO succession costs, restructuring charges, amortization of intangible assets, and non-cash share-based compensation, as applicable, on operating (loss) income and operating margin for each segment and in total for the periods presented below. Adjusted operating income and adjusted operating margin may be considered non-GAAP financial measures as contemplated by SEC Regulation G, Rule 100. For additional information regarding management’s decision to present this non-GAAP financial information, see the introduction to this Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”


	Three Months Ended August 31, 2025
(in thousands)	Home & Outdoor				Beauty & Wellness				Total
Operating loss, as reported (GAAP)	$	(72,578)	(34.8)	%	$	(243,139)	(109.0)	%	$	(315,717)	(73.1)	%

Asset impairment charges	85,537		41.0	%	240,857		108.0	%	326,394		75.6	%

Restructuring charges	1,501		0.7	%	1,504		0.7	%	3,005		0.7	%
Subtotal	14,460		6.9	%	(778)		(0.3)	%	13,682		3.2	%
Amortization of intangible assets	1,373		0.7	%	2,512		1.1	%	3,885		0.9	%
Non-cash share-based compensation	4,248		2.0	%	5,124		2.3	%	9,372		2.2	%
Adjusted operating income (non-GAAP)	$	20,081	9.6	%	$	6,858	3.1	%	$	26,939	6.2	%


	Three Months Ended August 31, 2024
(in thousands)	Home & Outdoor				Beauty & Wellness				Total
Operating income, as reported (GAAP)	$	31,152	12.9	%	$	3,700	1.6	%	$	34,852	7.3	%

Restructuring charges	518		0.2	%	1,008		0.4	%	1,526		0.3	%
Subtotal	31,670		13.1	%	4,708		2.0	%	36,378		7.7	%
Amortization of intangible assets	1,768		0.7	%	2,771		1.2	%	4,539		1.0	%
Non-cash share-based compensation	2,814		1.2	%	2,673		1.2	%	5,487		1.2	%
Adjusted operating income (non-GAAP)	$	36,252	15.0	%	$	10,152	4.4	%	$	46,404	9.8	%


	Six Months Ended August 31, 2025
(in thousands)	Home & Outdoor				Beauty & Wellness				Total
Operating loss, as reported (GAAP)	$	(286,371)	(74.1)	%	$	(436,384)	(104.7)	%	$	(722,755)	(90.0)	%

Asset impairment charges	304,632		78.8	%	436,147		104.7	%	740,779		92.2	%
CEO succession costs	1,742		0.5	%	1,742		0.4	%	3,484		0.4	%
Restructuring charges	1,501		0.4	%	1,504		0.4	%	3,005		0.4	%
Subtotal	21,504		5.6	%	3,009		0.7	%	24,513		3.1	%
Amortization of intangible assets	3,155		0.8	%	5,719		1.4	%	8,874		1.1	%
Non-cash share-based compensation	4,282		1.1	%	5,386		1.3	%	9,668		1.2	%
Adjusted operating income (non-GAAP)	$	28,941	7.5	%	$	14,114	3.4	%	$	43,055	5.4	%


	Six Months Ended August 31, 2024
(in thousands)	Home & Outdoor				Beauty & Wellness	Total
Operating income, as reported (GAAP)	$	47,002	10.7	%		$	18,613	4.1	%	$	65,615	7.4	%
Restructuring charges	958		0.2	%		2,403		0.5	%	3,361		0.4	%
Subtotal	47,960		10.9	%		21,016		4.7	%	68,976		7.7	%
Amortization of intangible assets	3,533		0.8	%		5,526		1.2	%	9,059		1.0	%
Non-cash share-based compensation	5,827		1.3	%		5,493		1.2	%	11,320		1.3	%
Adjusted operating income (non-GAAP)	$	57,320	13.0	%		$	32,035	7.1	%	$	89,355	10.0	%

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Consolidated Operating (Loss) Income

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Consolidated operating loss was $315.7 million, or (73.1)% of net sales revenue, compared to consolidated operating income of $34.9 million, or 7.3% of net sales revenue. Operating loss in the second quarter of fiscal 2026 included $326.4 million of pre-tax asset impairment charges. The remaining 4.8 percentage point decrease in consolidated operating margin was primarily due to:

•higher retail trade and promotional expense year-over-year;

•the impact of higher tariffs on our cost of goods sold;

•increased share-based compensation expense;

•higher outbound freight costs; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

These factors were partially offset by:

•the favorable impact of the acquisition of Olive & June within the Beauty & Wellness segment;

•lower commodity and product costs, partly driven by Project Pegasus initiatives;

•favorable inventory obsolescence expense year-over-year; and

•the favorable comparative impact of higher distribution center expense in the prior year period primarily due to additional costs and lost efficiency associated with automation startup issues at our Tennessee distribution facility.

Consolidated adjusted operating income decreased 41.9% to $26.9 million, or 6.2% of net sales revenue, compared to $46.4 million, or 9.8% of net sales revenue.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Consolidated operating loss was $722.8 million, or (90.0)% of net sales revenue, compared to consolidated operating income of $65.6 million, or 7.4% of net sales revenue. Operating loss during the first six months of fiscal 2026 included $740.8 million of pre-tax asset impairment charges. The remaining 5.2 percentage point decrease in consolidated operating margin was primarily due to:

•higher retail trade and promotional expense;

•the impact of higher tariffs on our cost of goods sold;

•increased outbound freight costs;

•higher marketing expense;

•unfavorable inventory obsolescence expense year-over-year;

•CEO succession costs of $3.5 million; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

These factors were partially offset by:

•lower commodity and product costs, partly driven by Project Pegasus initiatives;

•the favorable impact of the acquisition of Olive & June within the Beauty & Wellness segment; and

Consolidated adjusted operating income decreased 51.8% to $43.1 million, or 5.4% of net sales revenue, compared to $89.4 million, or 10.0% of net sales revenue.

Home & Outdoor

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Operating loss was $72.6 million, or (34.8)% of segment net sales revenue, compared to operating income of $31.2 million, or 12.9% of segment net sales revenue. Operating loss in the second quarter of

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fiscal 2026 included $85.5 million of pre-tax asset impairment charges. The remaining 6.7 percentage point decrease in segment operating margin was primarily due to:

•higher retail trade and promotional expense;

•the impact of higher tariffs on our cost of goods sold;

•increased share-based compensation expense;

•higher outbound freight costs; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

These factors were partially offset by:

•lower commodity and product costs, partly driven by Project Pegasus initiatives;

•reduced marketing expense; and

•the favorable comparative impact of higher distribution center expense in the prior year period.

Adjusted operating income decreased 44.6% to $20.1 million, or 9.6% of segment net sales revenue, compared to $36.3 million, or 15.0% of segment net sales revenue.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Operating loss was $286.4 million, or (74.1)% of segment net sales revenue, compared to operating income of $47.0 million, or 10.7% of segment net sales revenue. Operating loss during the first six months of fiscal 2026 included $304.6 million of pre-tax asset impairment charges. The remaining 6.0 percentage point decrease in segment operating margin was primarily due to:

•higher retail trade and promotional expense;

•the impact of higher tariffs on our cost of goods sold;

•unfavorable inventory obsolescence expense year-over-year;

•higher outbound freight costs; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

These factors were partially offset by lower commodity and product costs, partly driven by Project Pegasus initiatives, and the favorable comparative impact of higher distribution center expense in the prior year period.

Adjusted operating income decreased 49.5% to $28.9 million, or 7.5% of segment net sales revenue, compared to $57.3 million, or 13.0% of segment net sales revenue.

Beauty & Wellness

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Operating loss was $243.1 million, or (109.0)% of segment net sales revenue, compared to operating income of $3.7 million, or 1.6% of segment net sales revenue. Operating loss in the second quarter of fiscal 2026 included $240.9 million of pre-tax asset impairment charges. The remaining 2.6 percentage point decrease in segment operating margin was primarily due to:

•higher retail trade and promotional expense;

•the impact of higher tariffs on our cost of goods sold;

•increased share-based compensation expense;

•higher outbound freight costs;

•increased marketing expense; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

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These factors were partially offset by:

•the favorable impact of the acquisition of Olive & June;

•favorable inventory obsolescence expense year-over-year; and

•lower commodity and product costs, partly driven by Project Pegasus initiatives.

Adjusted operating income decreased 32.4% to $6.9 million, or 3.1% of segment net sales revenue, compared to $10.2 million, or 4.4% of segment net sales revenue.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Operating loss was $436.4 million, or (104.7)% of segment net sales revenue, compared to operating income of $18.6 million, or 4.1% of segment net sales revenue. Operating loss during the first six months of fiscal 2026 included $436.1 million of pre-tax asset impairment charges. The remaining 4.1 percentage point decrease in segment operating margin was primarily due to:

•higher retail trade and promotional expense;

•increased marketing expense;

•the impact of higher tariffs on our cost of goods sold;

•higher outbound freight costs; and

•the impact of unfavorable operating leverage due to the decrease in net sales.

These factors were partially offset by the favorable impact of the acquisition of Olive & June and lower commodity and product costs, partly driven by Project Pegasus initiatives.

Adjusted operating income decreased 55.9% to $14.1 million, or 3.4% of segment net sales revenue, compared to $32.0 million, or 7.1% of segment net sales revenue.

Interest Expense

Comparison of Second Quarter Fiscal 2026 to Second Quarter Fiscal 2025

Interest expense was $14.2 million, compared to $13.2 million. The increase in interest expense was primarily due to higher average borrowings outstanding, partially offset by a lower average effective interest rate inclusive of the impact of our interest rate swaps compared to the same period last year.

Comparison of First Six Months of Fiscal 2026 to First Six Months of Fiscal 2025

Interest expense was $28.0 million, compared to $25.8 million. The increase in interest expense was primarily due to higher average borrowings outstanding, partially offset by a lower average effective interest rate inclusive of the impact of our interest rate swaps compared to the same period last year.

Income Tax Expense

The comparison of our effective tax rate between periods is often impacted by the geographic mix of earnings among our various tax jurisdictions. Due to our organization in Bermuda and the ownership structure of our foreign subsidiaries, many of which are not owned directly or indirectly by a U.S. parent company, an immaterial amount of our foreign income is subject to U.S. taxation on a permanent basis under current law. Additionally, our intangible assets are primarily owned by foreign affiliates, resulting in proportionally higher earnings in jurisdictions with statutory tax rates lower than the U.S.

In July 2025, a reconciliation bill, commonly referred to as the One Big Beautiful Bill Act, was signed into law. The legislation includes a broad range of U.S. tax reform provisions. We are evaluating the impact of these provisions; however, there were no discrete effects in the second quarter of fiscal 2026 and we do not expect a material impact on our fiscal 2026 consolidated financial statements.

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course of the fiscal year in relation to pre-tax book income, rather than as a discrete item in the periods in which the charges were incurred.

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Net (Loss) Income, Diluted (Loss) Earnings Per Share, Adjusted Income (non-GAAP), and Adjusted Diluted Earnings Per Share (non-GAAP)

In order to provide a better understanding of the impact of certain items on our (loss) income and diluted (loss) earnings per share, the tables that follow report the comparative after-tax impact of asset impairment charges, Barbados tax reform, CEO succession costs, intangible asset reorganization, restructuring charges, amortization of intangible assets, and non-cash share-based compensation, as applicable, on (loss) income and diluted (loss) earnings per share for the periods presented below. Adjusted income and adjusted diluted earnings per share may be considered non-GAAP financial measures as contemplated by SEC Regulation G, Rule 100. For additional information regarding management’s decision to present this non-GAAP financial information, see the introduction to this Item 2., “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”


	Three Months Ended August 31, 2025
	(Loss) Income						Diluted (Loss) Earnings Per Share
(in thousands, except per share data)	Before Tax		Tax		Net of Tax		Before Tax		Tax		Net of Tax
As reported (GAAP)	$	(329,689)	$	(21,046)	$	(308,643)	$	(14.36)	$	(0.92)	$	(13.44)
Asset impairment charges	326,394		32,419		293,975		14.18		1.41		12.77

Intangible asset reorganization	—		(13,485)		13,485		—		(0.59)		0.59

Restructuring charges	3,005		421		2,584		0.13		0.02		0.11
Subtotal	(290)		(1,691)		1,401		(0.01)		(0.07)		0.06
Amortization of intangible assets	3,885		669		3,216		0.17		0.03		0.14
Non-cash share-based compensation	9,372		445		8,927		0.41		0.02		0.39
Adjusted (non-GAAP)	$	12,967	$	(577)	$	13,544	$	0.56	$	(0.03)	$	0.59

Weighted average shares of common stock used in computing:
Diluted loss per share, as reported											22,959
Adjusted diluted earnings per share (non-GAAP)											23,012


	Three Months Ended August 31, 2024
	Income						Diluted Earnings Per Share
(in thousands, except per share data)	Before Tax		Tax		Net of Tax		Before Tax		Tax		Net of Tax
As reported (GAAP)	$	21,806	$	4,792	$	17,014	$	0.95	$	0.21	$	0.74

Restructuring charges	1,526		138		1,388		0.07		0.01		0.06
Subtotal	23,332		4,930		18,402		1.02		0.22		0.81
Amortization of intangible assets	4,539		661		3,878		0.20		0.03		0.17
Non-cash share-based compensation	5,487		221		5,266		0.24		0.01		0.23
Adjusted (non-GAAP)	$	33,358	$	5,812	$	27,546	$	1.46	$	0.25	$	1.21

HELEN OF TROY LTD 10-Q