Amy Teske

Amy Teske, on for Mark Altschwager, inquired about the specific actions being taken within SG&A to limit deleverage as the company navigates a more pressured demand environment.

Answer

President & COO Kecia Steelman responded that SG&A spend was better than planned in the quarter due to disciplined cost management. She noted that for the full year, SG&A growth is expected to moderate in the second half as major transformational investments are completed, allowing the company to maintain financial discipline while still investing for long-term success.

Amy Teske, on behalf of Mark Altschwager, inquired about the cadence of demand throughout the second quarter, any material differences between regular-priced and clearance sales, and what provides confidence that core merchandise initiatives are on track amid macro challenges.

Answer

CFO Jill Timm described Q2 demand as relatively consistent, without significant inter-month fluctuations or unusual clearance activity compared to prior years. She stated that confidence in the strategy stems from the positive customer response to newness, such as the strong performance in dresses. While core areas like women's intimates and seasonal assortments were soft, the strategy to leverage the market for new products and reposition key departments like juniors near Sephora is expected to drive improvement.