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What Changed
Risk factors · Mar 31, 2025 → Mar 25, 2026
20 added · 23 removed between the two most recent 10-Ks. The risks a company starts — or stops — disclosing are often the story.
Newly disclosed
Risks Relating to Accounting and Legal Matters: Our business operations subject us to legal compliance and litigation risks, as well as regulations and regulatory enforcement priorities, which could result in increased costs or liabilities, divert our management’s attention or otherwise adversely affect our business, results of operations and financial condition.
The defense of these claims, even if ultimately successful, may result in costly litigation, and if the Company is not successful in its defense, it could be subject to injunctions and liability for damages or royalty obligations, and the Company’s sales, profitability, cash flows, financial condition and reputation could be adversely affected.
The use of AI in the development of our products could also cause loss of intellectual property, as well as subject us to risks related to intellectual property infringement or misappropriation, data privacy and cybersecurity.
There is no guarantee that our use of AI will enhance our technologies, benefit our business operations, or 18 produce apparel and accessories that are preferred by our customers.
Additionally, AI algorithms or training methodologies may be flawed, and datasets may contain irrelevant, insufficient or biased information, which can cause errors in outputs.
We are exploring incorporating artificial intelligence (AI) capabilities into the development of technologies, our business operations and our merchandise.
AI technology is complex and rapidly evolving and may subject us to significant competitive, legal, regulatory, operational and other risks.
These laws and regulations could cause us to incur greater compliance costs and limit the use of AI in the development of our products.
Our competitors may be more successful in their AI strategy and develop superior products with the aid of AI technology.
References to particular events or contingencies are provided as examples only and should not be interpreted as a complete listing or as any representation about whether or not such events or contingencies have occurred in the past or may occur in the future.
Any reduction in our customers’ discretionary spending on our products could erode our sales volume and adversely affect our results of operations and financial condition. 16 Risks Relating to Our Information Technology, Related Systems and Cybersecurity: A failure or disruption relating to our information technology systems could adversely affect our business.
The United States and other countries may adopt laws and regulations related to AI.
No longer disclosed
For example, the use of certain commodities in the manufacture of our products and energy we use in our operations may face increased regulation due to climate change or other environmental concerns, which could increase our costs.
The defense of these claims, even if ultimately successful, may result in costly litigation, and if the Company is not successful in its defense, it could be subject to injunctions and liability for damages or royalty obligations, and the Company’s sales, profitability, cash flows, financial condition and reputation could be adversely affected. 19 Our business operations subject us to legal compliance and litigation risks, as well as regulations and regulatory enforcement priorities, which could result in increased costs or liabilities, divert our management’s attention or otherwise adversely affect our business, results of operations and financial condition.
We have incurred substantial financial commitments and fixed costs related to our retail stores that we will not be able to recover if our stores are not successful and that have resulted in and could result in future impairment charges.
We are subject to supply chain disruptions affecting transit times and costs, including issues related to a sustained drought in Panama that is causing longer transit times through the Panama Canal and limiting the number of containers on a vessel due to vessel draft restrictions.
If we are unable to offset the effects of these increased costs to our business by increasing the retail prices of our products, reducing other expenses or otherwise, our business, margins, results of operations and financial condition may be adversely affected.
Furthermore, any failure of or perceived failure by us to comply with any potential future climate change regulatory requirements, including stakeholder expectations regarding the environment, could adversely affect our reputation and results of operations.
The physical effects of climate change such as extreme weather and drought could adversely affect our results of operations, including disrupting our supply chain, the costs of our products and negatively impacting our workforce.
Tight labor markets have caused wages to increase at the store, distribution center and home office levels, as well as making it more difficult to hire new associates and retain existing associates.
Risks Relating to Our Information Technology, Related Systems and Cybersecurity: A failure or disruption relating to our information technology systems could adversely affect our business.
Extreme weather, natural disasters, impacts of climate change, public health threats or similar events have and may continue to adversely affect our sales or operations from time to time.
If the Company is unable to successfully integrate new businesses into its existing business, the Company’s financial condition and results of operations will be adversely affected.
Existing and increased competition in the women’s retail apparel industry may negatively impact our business, results of operations, financial condition and market share.