Greetings, and welcome to the Vera Bradley, Inc. Second Quarter Fiscal 2026 Earnings Conference Call. At this time, participants are in a listen-only mode. A question and answer session will follow the formal presentation. You may be placed in the question queue at any time by pressing star one on your telephone keypad. As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Mark C. Dely, Chief Administrative Officer. Please go ahead, Mark.

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-Ks 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 will now turn it over to the call to Vera Bradley, Inc.'s Executive Chairman, Ian Martin Bickley. Ian?

Thank you for joining us today. It has been a busy two months since I took on the role as Executive Chairman. My team and I have hit the ground running to reinvigorate and reimagine Vera Bradley, Inc., an iconic brand with strong awareness and deep connections with consumers across generations. One thing that has become clear to me since stepping into this role is that our loyal customers love Vera Bradley. They truly want us to succeed. When we deliver the products and experiences they expect, they respond. We recognize there is much work ahead of us. But I want to be clear. We are implementing a comprehensive strategy to revitalize our market position by leveraging our brand's proven emotional connection with consumers. Our integrated approach spans strategic merchandising and product innovation, targeted marketing, and how we show up across shopping channels. All designed to reengage our loyal customer base while expanding our reach to new market segments. This disciplined focus on our core brand strengths, combined with data-driven consumer insights and seamless execution, will, over time, drive sustainable growth and restore our competitive advantage. To execute this strategy effectively, we're simultaneously transforming our operational foundation to improve focus, agility, and execution. We're streamlining decision-making processes, eliminating organizational complexity that has hindered our speed to market, and reallocating resources towards our highest impact initiatives. This operational discipline, combined with prudent cost management, will ensure we can invest meaningfully in the brand, innovation, and experiences our customers expect while delivering the financial performance our shareholders deserve. These structural improvements aren't just about efficiency. They're about building the agile, responsive organization needed to capitalize on Vera Bradley's iconic and distinctive brand positioning in the marketplace. On today's call, I will briefly discuss our second quarter performance, including several product and marketing…

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. 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. 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 2026, our consolidated revenues totaled $70.9 million compared to $94 million in the prior year second quarter. Net loss from continuing operations for the second quarter totaled negative $500,000 or negative $0.02 per diluted share compared to net income from continuing operations of $2.6 million last year or $0.09 per diluted share. In terms of segment performance, Vera Bradley, Inc.'s direct segment revenues for the second quarter totaled $60.5 million, a 16.2% decrease from $72.2 million in the prior year. Comparable sales similarly declined 17.3% driven by conversion declines in our full-line outlet and e-commerce channels. Total revenues were also impacted by 10 new store openings and 13 store closures over the past twelve months. Vera Bradley, Inc. indirect segment revenues for the second quarter totaled $10.3 million, a 52.5% decrease from $21.8 million in the prior year quarter. The decrease was related primarily to a decline in key account orders as well as liquidation sales. Gross margin totaled $35.4 million or 49.9% of net revenue compared to $46.8 million or 49.8% of net revenues in the prior year. The slight increase in year-over-year margin rate resulted from lower liquidation sales, partially offset by incremental shipping costs driven by channel shifts from brick-and-mortar stores to online sites. SG&A expense totaled $36.3 million or 51.2% of net revenues compared to $43.6 million or 46.4% of net revenues…

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