Vera Bradley Fourth Quarter Fiscal 2026 Earnings Call - Return to Profitability as Project Sunshine Gains Traction

Operator: Greetings, and welcome to the Vera Bradley fourth quarter fiscal 2026 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mark Dely, Chief Administrative Officer for Vera Bradley. Thank you. You may begin.

Mark Dely, Chief Administrative Officer, Vera Bradley: Good morning, and welcome everyone. We’d like to thank you for joining us for today’s call. Some of the statements made during our prepared remarks and in response to your questions may constitute forward-looking statements made pursuant to and within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995 as amended. Such forward-looking statements are subject to both known and unknown risks and uncertainties that could cause actual results to differ materially from those that we expect. Please refer to today’s press release and the company’s most recent Form 10-K filed with the SEC for a discussion of known risks and uncertainties. Investors should not assume that the statements made during the call will remain operative at a later time. We undertake no obligation to update any information discussed on today’s call.

I’ll now turn the call over to Vera Bradley’s Chairman and Chief Executive Officer, Ian Bickley. Ian?

Ian Bickley, Chairman and Chief Executive Officer, Vera Bradley: Good morning, everyone, and thank you for joining us for Vera Bradley’s fourth quarter and full year 2026 earnings call. Before I begin discussing our quarterly results and continued transformation progress, I want to share some important leadership news that reflects the board’s confidence in our strategic direction and the momentum we are building. I am pleased to announce that the board of directors has named me as Vera Bradley’s permanent Chief Executive Officer in addition to my current role as Chairman of the board, transitioning from my role as Executive Chairman. Additionally, our Chief Financial Officer, Martin Layding, will be expanding the scope of his responsibilities as Chief Operating and Financial Officer. I want to express my sincere gratitude to our board of directors for their support, confidence, and this tremendous opportunity to lead Vera Bradley into its next chapter of growth.

This leadership transition reinforces the board’s belief in our existing strategies under Project Sunshine and validates that we are on the right path forward. I remain confident that with the right focus, effort, and execution, we have a tremendous opportunity to increase market share and return the business to growth by reengaging our loyal customer base while also expanding our reach and relevance to new customer segments. In addition to my appointment to the permanent CEO seat and Marty’s added role as COO, over the past few months, we have added new leadership talent across all key customer-facing functions, including merchandising, marketing, digital commerce, wholesale, and stores. This was achieved through a combination of new external leadership appointments as well as internal promotions of top talent, demonstrating our commitment to the path of continued progress in reinvigorating and reimagining the iconic Vera Bradley brand.

I’m also pleased to report that the fourth quarter marks our first quarter of profitability in over a year. We are stabilizing our business, gaining better visibility to the underlying growth and efficiency opportunities, and beginning to make meaningful progress on our transformation journey. Looking to FY 2027, we are planning our sales to be between $255 million and $270 million. The board’s decision to formalize our leadership structure at this pivotal moment underscores the collective confidence in our transformation plans and ability to deliver long-term sustainable results. Over the past quarter, we have remained focused on delivering Project Sunshine, which anchors on reclaiming Vera Bradley’s joyful optimism and acts as our North Star, bringing creative energy to how we work within functions and across the Vera Bradley team.

It is leading us to new ideas for products, marketing, and channels, transforming how we work with each other and encouraging us to think differently about our operations. At the same time, we have been addressing past missteps with urgency and implementing comprehensive changes across the business and organization, demonstrating the focus and agility of our team. To remind you, the five strategic pillars under Project Sunshine are, first, sharpening our brand focus through product relevance and storytelling. Second, resetting our go-to-market approach with data-led insights. Third, rewiring our digital ecosystem across all touch points. Fourth, implementing Outlet 2.0 for a more brand-enhancing retail experience. Fifth, reimagining how we work with new capabilities and organizational alignment.

Before updating you on our progress across these five pillars, I would like to provide a few fourth quarter highlights that clearly demonstrate continued sequential improvement and measurable progress towards our goal of achieving long-term sustainable growth and profitability. For the fourth quarter, we achieved strong sequential improvement in our direct channel, registering a revenue decline of 2.6% compared to the prior year, 270 basis points of progress from Q3 and nearly 1,400 basis points from Q2. The Q4 direct channel top-line results represent our third consecutive quarter of sequential improvement, and I’m pleased to report that our fiscal 2027 Q1 direct channel revenue is tracking positive, marking a significant milestone in the stabilization of our business.

While we have work to do, this performance is building confidence in our teams and reinforces that the direction we are taking is beginning to resonate with our consumers. Overall sales for the fourth quarter were down 1.7% versus Q4 of the prior year, benefiting from positive year-over-year indirect channel revenue growth of just under 5%. Our indirect channel growth was driven by a large wholesale order from an upcoming spring collaboration, which we’re very excited about and will be able to announce shortly. During the quarter, we also successfully and intentionally leveraged holiday traffic to clear through the discontinued product from last year’s Project Restoration while rebuilding our assortment of hero products, including the Original 100 Bag, iconic heritage prints, and select IP, including Snoopy and Lilo & Stitch. We continue to see strong consumer acceptance to the strategic reinvestment in our cotton-based assortment.

In our brand channels, we experienced a second consecutive quarter of strong double-digit positive comp growth, further validating that we’re moving the overall product assortment in the right direction. In our outlet channel, a more impactful and better executed end-of-season sale in January drove clearance and successful sell-through of discontinued and aged products. At the same time, customers responded positively to the return of classics and handbags, including the Triple Zip, Glenna, and Vera franchise, as well as the giftability of our Cozy Collection. We are also encouraged by the positive response we are seeing to the first deliveries of new spring-summer product that flowed into our stores at the end of January. For the quarter, comparable sales declined by less than 1%, and when we account for the negative impact of Winter Storm Fern during the last week of January, our comparable sales were essentially flat.

As I mentioned, this marks our first quarter of achieving profitability in over a year, with net income of $2.5 million and an EPS of $0.09, a positive year-over-year swing of $0.28. Our bottom-line results were driven primarily through disciplined cost management, while our overall results demonstrate that we are stabilizing the business, gaining better visibility, and beginning to make meaningful progress on our transformation journey. Marty will provide greater detail, but through an improvement in product acceptance, continued inventory management efforts, and disciplined pricing and promotional strategies while delivering smart value to our customers, we generated year-over-year gross margin expansion of approximately 100 basis points. We also managed our SG&A spend prudently, with total costs down more than $10 million to the prior year or a favorable decline of 22%.

From a cash flow perspective, we generated $17 million in operating cash flow in Q4. This strong cash flow generation allowed us to pay off our ABL facility, further strengthening our balance sheet and providing additional financial flexibility as we continue executing Project Sunshine. While we recognize there’s still significant work ahead, these early wins give us confidence that our focused approach to product innovation, brand storytelling, and operational excellence is moving Vera Bradley in the right direction. The sequential improvement we’ve achieved across multiple quarters, combined with our return to profitability this quarter, validates that Project Sunshine is gaining traction and positioning us for long-term sustainable growth, profitability, and cash flow generation. I want to personally thank our entire team for their disciplined execution, agility, and commitment to operational excellence during the all-important holiday season, which allowed us to achieve these results.

Now for an update on our Project Sunshine strategic initiatives. First up, sharpening our brand focus. As I’ve discussed on prior calls, we lost track of what made Vera Bradley special and unique and what customers loved about us. We became indistinguishable from other brands and over-reliant on promotions. Sharpening our brand focus has been all about bringing our unique and distinctive brand positioning to life through our products, marketing, and storytelling, and where consumers can find our products. Since I joined in my executive chair role roughly eight months ago, our number one focus has been on improving the product. This is an effort that doesn’t happen overnight, but our Q4 results are testament to the early success we’re experiencing.

We are seeing strong initial indicators of our product strategy’s effectiveness, and our continued momentum in Q4 was fueled in part by the return of discontinued styles that our customers had been asking for. This 20% of the assortment that we were able to influence this quarter delivered encouraging results, validating our merchandising approach. The great news is that through a combination of reintroduced styles in high demand, coupled with newly designed products, the team has successfully influenced approximately 80% of the spring assortment and is generating positive customer response and early sales momentum. The assortment changes we have made remain anchored in the brand attributes which are core to our DNA. Vera Bradley is feminine, creative, cheerful, whimsical, joyful, fun, colorful, approachable, high quality, and smart value.

To support the significant progress we have made on the product assortment during the past eight months, we are now putting increased focus on storytelling through an enhanced social-first marketing strategy to engage both our existing customers and new audiences. From a creative standpoint, under new marketing leadership and leveraging our core brand attributes, we have shot a new spring campaign that reflects our return to joyful optimism and authentic Vera Bradley roots. This refreshed creative is being deployed across our website and email marketing with a major social media push that just began last week. Our marketing strategy has been focused on three key priorities, channel optimization, refined messaging, and enhanced media efficiency. Despite reducing overall marketing spend year-over-year, we achieved strong performance across multiple metrics. Return on ad spend improved meaningfully. Email open rates increased, and we successfully scaled our paid social programs while maintaining consistent returns.

In addition to product and marketing, we have also been focused on our channels of distribution in order to sharpen our brand focus and amplify our messaging. Let me first spend a moment on our wholesale strategy and partnerships. As I’ve stated before, while the overall landscape of wholesale partners has evolved, we believe that rebuilding the wholesale channel with the right partners will be a key component of our success in regaining brand relevance and market share. Under new wholesale leadership that has recently joined, we are building a tiered strategy with focus on key retailers, strategic collaborations, and specialty accounts. In the meantime, we are thrilled about a large wholesale order that shipped late in Q4 for a very exciting upcoming collaboration, which we will be able to announce soon. We are also seeing recognition of the brand momentum by some leading retail accounts.

For back to school, we will launch a focused Vera Bradley capsule collection in 89 Nordstrom doors and on nordstrom.com. Let me also spend a moment discussing our IP partnerships, which remain an important driver of brand heat and commercial success, and as we engage both new customers and repeat purchasers looking to collect items. Our strategy is to focus on fewer, more impactful, and qualitatively executed IP launches going forward. The success of this strategy was evidenced by our Peanuts, Lilo & Stitch, and recent Winnie the Pooh collaborations, which achieved excellent social media engagement and strong product sell-through, some of the best results we have ever had. Second, resetting our go-to-market approach. As previously shared, we have been fundamentally updating our go-to-market approach to deliver what our customers truly need and value, working across six critical areas. More focused investments into bigger product ideas and hero styles.

Alignment of our channel assortment strategy. Integrated social-first marketing to support our big ideas in moments like back to school. Better planning and inventory management capabilities to improve turns. Stronger pricing and promotion governance to protect margins. Enhanced analytics and business intelligence capabilities to inform data-driven decisions. Our goal has been to rebuild the engine that turns our creativity into commercial results and to work in a more integrated and agile manner. In Q4, we saw several examples of this new approach positively impacting our business performance. The team began the process of coming together cross-functionally and scrutinizing how we work from product development to buying to marketing and executing strategies in our channels, ensuring the right products reach our customers through their preferred shopping channels.

We have now integrated consumer insights into this process with the implementation of various customer ethnographies, segmentation, focus groups, and quantitative analyses that are informing product development to address our customers’ needs and wants more effectively going forward. Operationally, we were much more agile, reacting to our data to adjust promotions, marketing, and digital communications to meet real-time customer needs, improving gross margin year-to-year and enabling reductions in overall inventory. For Q1, we have developed a streamlined promotional plan that is more focused and less complex to execute that we believe will lead to further gross margin improvements.

We also began to impact the business upstream with a new creative team quickly conceiving and executing this spring’s campaign with an on-location shoot at dramatically lower cost than historic levels and producing recognizable and relatable campaign imagery to which our customers have positively responded. We are excited about these early achievements and optimistic about the impact that our integrated approach will continue to have on the business in the year ahead. Moving to our third pillar, rewiring our digital ecosystem. As mentioned previously, our digital commerce business across owned sites and third-party marketplaces is already a very important business for Vera Bradley, both in terms of the business size and overall profitability. However, our various digital platforms, there has not been a cohesive customer journey for Vera Bradley customers.

During Q4, we took the important step of consolidating the P&Ls of all our digital platforms, including DTC e-commerce and third-party marketplace operations, and we are currently recruiting a new head of digital commerce to lead this integrated function. At the same time, while taking these important strategic steps, we made significant enhancements to our e-commerce platform, with improved site navigation and a better overall customer experience. Our data-driven approach to pricing and promotions has enabled us to operate with lower promotional intensity while maintaining strong customer engagement. Additionally, we deployed enhanced digital capabilities that are driving customer engagement. Early results also show strong adoption of our streamlined checkout process, which is contributing to improved conversion rates. Fourth, Outlet 2.0. As a reminder, our Outlet 2.0 initiative represents a fundamental shift in how we approach our outlet channel.

Outlet 2.0 is designed to elevate customer experience while maintaining our smart value proposition and reaching customers where we currently do not have brand stores. The enhancements included a curated, more focused assortment with an initial 35% SKU reduction, strategically adding new brand products from our heritage and select IP collections. We have introduced elevated visual merchandising elements, including mannequins, light boxes, and brand fixtures that hero our signature color, pattern, and lifestyle stories. Our enhanced selling experience incorporates updated training, improved in-store tools for selling, and personalization. This transformation moves us from a discount-focused model to a smart value curated experience that reinforces brand equity while driving conversion and profitability. Building on the pilot that we launched during the holiday season, we have been taking a disciplined test-and-learn approach.

So far, in addition to the positive qualitative feedback from our customers and employees, we have seen measurable improvements in retail KPIs including overall sales, conversion rate, average spend, and gross profit per visitor versus a control group of stores. This tells us that the Outlet 2.0 experience is engaging consumers in a more meaningful way with the brand. We are continuing to monitor and track these results while also refining the Outlet 2.0 pilot with a view to rolling out additional stores in the near future. Last but not least, reimagining how we work, streamlining our organization while building and investing in new capabilities. Rebuilding Vera Bradley for long-term sustainable growth and profitability has required us to make tough decisions to reduce personnel costs.

At the same time, reimagining how we work is not only about cutting costs, but also about redesigning our organization to be future fit, building new capabilities, and making significant investments in our talent. To date, this has been most pronounced across our customer-facing product, marketing, and commercial functions, which are vital to reinvigorating the relevance of our brand and driving brand heat. In addition to the appointment of a new chief brand officer in October, we have now also appointed new leaders across merchandising, marketing, stores, wholesale, and a soon to be appointed new head of digital commerce. We have strategically strengthened our team through a combination of internal promotions and strategic external hires, with particular focus on roles that directly impact the customer experience across all touch points.

To sum up, we remain confident that the five strategic pillars we are pursuing under Project Sunshine are the right initiatives to revitalize the Vera Bradley brand, expand market share, and return the business to long-term sustainable growth, profitability, and cash flow. To execute these plans, we have been building a best-in-class team with relevant experience that will allow us to move quickly to win in the marketplace. We are reimagining how we work, building a culture of performance, agility, accountability, and strong cross-functional collaboration, leveraging data-driven insights to make smart decisions. We are still in the very early stages of our transformation but remain encouraged by the results we achieved in Q4, the stabilization of our business, the greater visibility we have to the underlying opportunities, and the strong belief and alignment our entire team and board of directors has behind our transformation plans.

As the newly appointed CEO of Vera Bradley, I am extremely excited about the opportunity to lead us into the future and write the next chapter of this iconic and storied brand. With that, I will turn the call over to Marty for a detailed financial review, and then we’ll be happy to take your questions.

Martin Layding, Chief Operating Officer and Chief Financial Officer, Vera Bradley: Thanks, Ian. Good morning, everyone, and thank you for joining us. I have a few brief comments to make about our performance for the quarter. Before I begin, I wanna thank the board for their unwavering support and confidence in entrusting me with expanded operational responsibilities. Our focus remains on transforming our operational processes to deliver enhanced business performance and greater efficiency across the organization. For the sake of clarity, all of the numbers I am discussing today are non-GAAP and exclude the charges outlined in today’s press release. A complete detail of items excluded from the non-GAAP numbers, as well as a reconciliation of GAAP to non-GAAP, can be found in that release. For the fourth quarter of fiscal 2026, our consolidated revenues totaled $84.9 million, compared to $86.4 million in the prior year fourth quarter.

Net income from continuing operations for the fourth quarter totaled $2.5 million, or $0.009 per diluted share, compared to a net loss from continuing operations of -$5.4 million last year, or -$0.19 per diluted share. In terms of segment performance, Vera Bradley direct segment revenues for the current year fourth quarter totaled $74.5 million, a 2.6% decrease from $76.5 million in the prior year fourth quarter. Comparable sales declined 0.7%, which represents a sequential comparable sales improvement in each quarter of the current fiscal year. Our Original 100 Bag heritage print, along with leveraging holiday promotional activity, resulted in positive brand comps and overall positive growth versus last year.

Total revenues year over year were also impacted by two new store openings, 13 store closures since the prior year fourth quarter, and negatively impacted by approximately $0.4 million due to the temporary store closures associated with Winter Storm Fern in week 52. Vera Bradley indirect segment revenues for the fourth quarter totaled $10.4 million, a 4.9% increase from $9.9 million in the prior year fourth quarter. The increase was driven by a large wholesale spring collaboration to be announced at a future date. Fourth quarter gross margin totaled $40.5 million, or 47.8% of net revenues, compared to $40.4 million, or 46.8% of net revenues in the prior year.

The increase in year-over-year margin rate resulted from lower promotional activity in outlet channels, a favorable adjustment to the Q3 inventory reserve and freight cost savings, partially offset by sell-through of Project Restoration inventory as part of clearance and incremental duty costs. SG&A expense totaled $37.3 million, or 43.9% of net revenues, compared to $47.9 million, or 55.4% of net revenues for the prior year fourth quarter. The $10.6 million decrease in expenses was primarily due to continued cost reduction initiatives, reduction and phasing of marketing expenses during the year, and reduced lease costs.

Fourth quarter operating income from continuing operations totaled $3.6 million, or 4.2% of net revenue, compared to an operating loss from continuing operations of -$7.3 million or -8.5% of net revenues in the prior year. We continue to be pleased with our operational performance, demonstrating increased levels of agility as we react to changes in the marketplace, enabling us to take advantage of opportunities, thus improving our sell-through of aged inventory through more focused strategies and tactics. Now turning to the balance sheet. Cash and cash equivalents at the end of the quarter totaled $18.5 million. Cash flow for the year, while -$11.9 million, is significantly improved from FY 2025’s -$46.9 million. We had no borrowings on our ABL facility at year-end.

Fourth quarter inventory decreased year-over-year by nearly 17% to $76 million, compared to $91.4 million at the end of fourth quarter last year. Tariffs increased year-end inventory value by approximately $4.2 million. Excluding tariff impact, inventory dollars would have decreased over approximately 22% versus last year. Our inventory turns were 1.6, improved from 1.5 from fiscal year 2025. We recognize that this is a key measure we need to improve on while also reducing our overall level of inventory in FY 2027. In FY 2027, we will begin experimenting with new strategies to improve our responsiveness to our consumers once sell-through is ahead of expectations, while looking for opportunities to continue our sell-down of Project Restoration inventory, thus improving our net working capital position and inventory productivity overall.

As Ian mentioned, we are providing some guidance for fiscal year 2027. For fiscal year 2027, we plan for sales to be in the range of $255 million-$270 million as we continue to focus on stabilizing the direct business and rebuilding our wholesale business under new leadership, while at the same time placing less emphasis on liquidation channels. It is important to note that we will not be holding our annual outlet sale in the first quarter as we focus on inventory for our stores and look to elevate the overall customer and brand experience for this event, which we hope to bring back and better in the future.

Further, due to our continued operational focus in fiscal 2027, we expect to see year-over-year rate improvement in both gross profit and SG&A, enabling operating loss improvement of 40% or better, compared to an adjusted operating loss of $21.7 million in fiscal 2026. In closing, I want to reiterate that we are encouraged by the progress we have made throughout fiscal 2026. We have significantly improved our operational efficiency, reduced our cost structure, and strengthened our balance sheet.

Ian Bickley, Chairman and Chief Executive Officer, Vera Bradley: We still have work ahead of us. We are confident in our strategic direction and our ability to drive sustainable, profitable growth over time. Now I will open the call to your questions. Operator?

Operator: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. One moment please while we poll for any questions. Our first question comes from the line of Eric Beder with SCC Research. Please proceed with your question.

Eric Beder, Analyst, SCC Research: Good morning. Congratulations on the appointment and the strong Q4 results. You know, when we look at it, I know you continue to make progress. When should we feel that the product flows and kind of the product mix is where you want it to be? I know you’ve worked through kind of some of prior management’s pieces. You know, how should we be judging what we’re seeing as we go to the stores and beyond, through this year?

Ian Bickley, Chairman and Chief Executive Officer, Vera Bradley: I’ll begin. Thanks, Eric, first of all, and appreciate the comments. You know, obviously, this is a really exciting opportunity and I’m delighted to have the chance to have stepped into this role. I think, you know, pretty consistent with what we have said before, you know, our impact on product, you know, has gradually improved over time, right, in terms of what we could impact. As I mentioned in the call, you know, about 80% of what is in there for spring/summer, we’ve been able to impact. I think to fall/winter, you know, we basically have a blank sheet of paper and everything that is there we will have been able to impact.

You know, additionally, we are continuing to learn from the product that has flowed in already in terms of the decisions that we’ve made. With that said, you know, as you are well aware, we are still managing through and balancing, you know, some overhang of inventory from Project Restoration, you know, a lot of the discontinued and aged products. I think this is gonna continue to be a path that we’re gonna have to navigate through over the next, you know, 6-12 months.

I think overall, I really do think that we need to look at fiscal 2027 still as a year of both stabilization of the business, but also a year where we are continuing to build, you know, the strong foundations that we believe are gonna lead the business to growth in FY 2028 and beyond.

Eric Beder, Analyst, SCC Research: Great. When you think about the future, some of the shifts going on in terms of stores and other pieces, you know, where should we be thinking about the depth and where the focuses are gonna be on the stores, versus the digital versus the other pieces, and how the store flows can kind of look going forward?

Ian Bickley, Chairman and Chief Executive Officer, Vera Bradley: Yeah, no, I think it’s a great question. Obviously, you know, let’s not downplay the digital business because it is a very important part of our business today. It is an important source of profitability, and it is an important way in which, you know, we can reach consumers, especially new consumers, when, you know, our retail and outlet fleet may not be optimized in the way that we would like it to be. With respect to the brick and mortar, I think, first of all, you know, we’re gonna continue to leverage the fleet that we have and optimize, you know, the productivity of that business.

That’s a big reason, you know, for Outlet 2.0, because the majority of our fleet today is outlet stores, which is sort of a legacy that we have inherited. These stores are, as you know, very productive. They get incredibly high foot traffic, and the majority of them are located in centers where there are also luxury brands and other premium, you know, accessible luxury brands. There’s a very high quality footfall and eyeballs that we get. You know, it is important for us to be the best that we can be in those outlet centers because that’s where we’re getting the majority of the retail footfall visibility today. In terms of the brand stores, you know, this for us is an opportunity.

As we get more confident about the performance of the product, and as you know, we’re now really gonna step into a much higher gear with the marketing now that we’re feeling good about the product pipeline. You know, this is gonna be something we’re gonna be looking at very carefully in terms of where we could selectively open new brand stores in pockets which would make sense for us and where we don’t have coverage. I would say the last piece of this is, you know, gonna be the wholesale channel, which for us is going to be a very important channel that we need to focus on and rebuild.

Because one of the things we you know hear from many of our consumers when we do research is they don’t know where to find us. In many of these sort of more affluent areas, we don’t have brand stores. I think we also have an opportunity with our wholesale accounts to develop the business there. Focusing on key retailers, specialty accounts in particular, this is a way for us to broaden you know awareness and reach and fill in some of the gaps that we don’t have with our own fleet. You know, I think all boats will rise.

Eric Beder, Analyst, SCC Research: Great. You’re at seven Outlet 2.0’s. Do you think you’ll open any more of them in 2026 or should we be thinking about it as another year kind of increasing the experimentation with the groups? Thank you.

Ian Bickley, Chairman and Chief Executive Officer, Vera Bradley: I can’t say that definitively. I think you meant will we open anything in FY 2027, right? This fiscal year.

Eric Beder, Analyst, SCC Research: Yeah. I’m sorry. 26.

Ian Bickley, Chairman and Chief Executive Officer, Vera Bradley: Yeah. No worries. Look, I think, you know, if I had to, you know, place a bet, I would say we are inclined to do a few more Outlet 2.0 stores this fiscal year. I think there are just some opportunities to refine what we do in Outlet 2.0 and also to think about where we’re gonna be the best places for us to do it.

Eric Beder, Analyst, SCC Research: Great. Again, congratulations and look forward to 2026.

Ian Bickley, Chairman and Chief Executive Officer, Vera Bradley: Great. Thank you, Eric.

Operator: Thank you. We have reached the end of the question-and-answer session, and this also concludes today’s conference call. You may disconnect your lines at this time, and we do thank you for your participation. Have a great day.