CarParts.com (PRTS) 10-Q30 Oct 232023 Q3 Quarterly reportFinancial data

Company Profile

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2023	Oct. 23, 2023
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-33264
Entity Registrant Name	CARPARTS.COM, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	68-0623433
Entity Address, Address Line One	2050 W. 190th Street
Entity Address, Address Line Two	Suite 400
Entity Address, City or Town	Torrance
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	90504
City Area Code	424
Local Phone Number	702-1455
Title of 12(b) Security	Common Stock, $0.001 par value per share
Trading Symbol	PRTS
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Smaller Reporting Company	false
Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		57,498,607
Entity Central Index Key	0001378950
Current Fiscal Year End Date	--12-30
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 66,679	$ 18,767
Accounts receivable, net	9,448	6,406
Inventory, net	123,965	136,026
Other current assets	6,671	6,672
Total current assets	206,763	167,871
Property and equipment, net	23,719	24,290
Right-of-use - assets - operating leases, net	20,611	23,951
Right-of-use - assets - finance leases, net	16,465	19,750
Other non-current assets	3,264	2,537
Total assets	270,822	238,399
Current liabilities:
Accounts payable	83,432	57,616
Accrued expenses	21,860	16,466
Right-of-use - obligation - operating, current	4,845	4,571
Right-of-use - obligation - finance, current	4,426	4,753
Other current liabilities	5,008	4,622
Total current liabilities	119,571	88,028
Right-of-use - obligation - operating, non-current	17,688	21,412
Right-of-use - obligation - finance, non-current	13,348	15,916
Other non-current liabilities	2,550	2,971
Total liabilities	153,157	128,327
Commitments and contingencies
Stockholders' equity:
Common stock, $0.001 par value; 100,000 shares authorized; 57,497 and 54,693 shares issued and outstanding as of September 30, 2023 and December 31, 2022 (of which 3,060 and 2,565 are treasury stock, respectively)	60	57
Treasury stock	(9,766)	(7,625)
Additional paid-in capital	309,106	297,265
Accumulated other comprehensive income	1,153	1,126
Accumulated deficit	(182,888)	(180,751)
Total stockholders' equity	117,665	110,072
Total liabilities and stockholders' equity	$ 270,822	$ 238,399

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands	Sep. 30, 2023	Dec. 31, 2022
CONSOLIDATED BALANCE SHEETS
Common stock, par value (in USD per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	100,000	100,000
Common stock, shares issued (in shares)	57,497	54,693
Common stock, shares outstanding (in shares)	57,497	54,693
Treasury stock (in shares)	3,060	2,565

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE OPERATIONS - USD ($) shares in Thousands, $ in Thousands		3 Months Ended		9 Months Ended
		Sep. 30, 2023	Oct. 01, 2022	Sep. 30, 2023	Oct. 01, 2022
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE OPERATIONS
Net sales		$ 166,864	$ 164,807	$ 519,334	$ 507,080
Cost of sales (1)	[1]	112,047	108,659	341,524	327,835
Gross profit		54,817	56,148	177,810	179,245
Operating expenses
Operating expense		57,734	56,729	180,935	173,144
(Loss) income from operations		(2,917)	(581)	(3,125)	6,101
Other income (expense):
Other income, net		874	117	2,427	363
Interest expense		(360)	(435)	(1,043)	(1,073)
Total other income (expense), net		514	(318)	1,384	(710)
(Loss) income before income taxes		(2,403)	(899)	(1,741)	5,391
Income tax provision		114	49	396	118
Net (loss) income		(2,517)	(948)	(2,137)	5,273
Other comprehensive gain (loss):
Foreign currency translation adjustments		0	0	0	124
Unrealized gain (loss) on deferred compensation trust assets		(21)	(36)	27	(170)
Total other comprehensive gain (loss)		(21)	(36)	27	(46)
Comprehensive (loss) income		$ (2,538)	$ (984)	$ (2,110)	$ 5,227
Net (Loss) Income Per Share
Basic net (loss) income per share		$ (0.04)	$ (0.02)	$ (0.04)	$ 0.10
Diluted net (loss) income per share		$ (0.04)	$ (0.02)	$ (0.04)	$ 0.09
Weighted-average common shares outstanding:
Shares used in computation of basic net (loss) income per share		57,179	54,481	56,252	54,009
Shares used in computation of diluted net (loss) income per share		57,179	54,481	56,252	57,283

[1] Excludes depreciation and amortization expense which is included in operating expense.

CONSOLIDATED STATEMENTS OF STOC

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-in- Capital	Treasury Stock	Accumulated Other Comprehensive (Loss) Income	Accumulated Deficit	Total
Beginning balance at Jan. 01, 2022	$ 56	$ 282,663	$ (7,625)	$ 274	$ (179,800)	$ 95,568
Beginning balance (in shares) at Jan. 01, 2022	52,960
Increase (Decrease) in Stockholders' Equity
Net Income (Loss)					2,103	2,103
Issuance of shares in connection with stock option exercise		792				792
Issuance of shares in connection with stock option exercise (in shares)	533
Issuance of shares in connection with restricted stock units vesting	$ 1	(1)
Issuance of shares in connection with restricted stock units vesting (in shares)	519
Issuance of stock awards to consultants		81				81
Issuance of stock awards to consultants (in shares)	10
Issuance of shares in connection with BOD Fees		6				6
Issuance of shares in connection with ESPP		431				431
Issuance of shares in connection with ESPP (in shares)	45
Officers and directors stock purchase plan		23				23
Officers and directors stock purchase plan (in shares)	3
Share-based compensation		4,225				4,225
Unrealized gain (loss) on deferred compensation trust assets				(34)		(34)
Effect of changes in foreign currencies				20		20
Ending balance at Apr. 02, 2022	$ 57	288,220	(7,625)	260	(177,697)	103,215
Ending balance (in shares) at Apr. 02, 2022	54,070
Increase (Decrease) in Stockholders' Equity
Net Income (Loss)					4,118	4,118
Issuance of shares in connection with stock option exercise		136				136
Issuance of shares in connection with stock option exercise (in shares)	70
Issuance of shares in connection with restricted stock units vesting (in shares)	220
Issuance of shares in connection with BOD Fees		6				6
Officers and directors stock purchase plan		4				4
Share-based compensation		771				771
Unrealized gain (loss) on deferred compensation trust assets				(100)		(100)
Effect of changes in foreign currencies				104		104
Ending balance at Jul. 02, 2022	$ 57	289,137	(7,625)	264	(173,579)	108,254
Ending balance (in shares) at Jul. 02, 2022	54,360
Increase (Decrease) in Stockholders' Equity
Net Income (Loss)					(948)	(948)
Issuance of shares in connection with stock option exercise		184				184
Issuance of shares in connection with stock option exercise (in shares)	63
Issuance of shares in connection with restricted stock units vesting (in shares)	72
Issuance of shares in connection with BOD Fees		6				6
Issuance of shares in connection with BOD Fees (in shares)	1
Issuance of shares in connection with ESPP		363				363
Issuance of shares in connection with ESPP (in shares)	62
Share-based compensation		3,760				3,760
Unrealized gain (loss) on deferred compensation trust assets				(36)		(36)
Ending balance at Oct. 01, 2022	$ 57	293,450	(7,625)	228	(174,527)	111,583
Ending balance (in shares) at Oct. 01, 2022	54,558
Beginning balance at Dec. 31, 2022	$ 57	297,265	(7,625)	1,126	(180,751)	110,072
Beginning balance (in shares) at Dec. 31, 2022	54,693
Increase (Decrease) in Stockholders' Equity
Net Income (Loss)					1,051	1,051
Issuance of shares in connection with stock option exercise	$ 1	1,523				1,524
Issuance of shares in connection with stock option exercise (in shares)	972
Issuance of shares in connection with restricted stock units vesting	$ 1					1
Issuance of shares in connection with restricted stock units vesting (in shares)	495
Issuance of shares in connection with BOD Fees		6				6
Issuance of shares in connection with BOD Fees (in shares)	1
Issuance of shares in connection with ESPP		221				221
Issuance of shares in connection with ESPP (in shares)	42
Share-based compensation		4,170				4,170
Unrealized gain (loss) on deferred compensation trust assets				24		24
Ending balance at Apr. 01, 2023	$ 59	303,185	(7,625)	1,150	(179,700)	117,069
Ending balance (in shares) at Apr. 01, 2023	56,203
Beginning balance at Dec. 31, 2022	$ 57	297,265	(7,625)	1,126	(180,751)	$ 110,072
Beginning balance (in shares) at Dec. 31, 2022	54,693
Increase (Decrease) in Stockholders' Equity
Issuance of shares in connection with stock option exercise (in shares)						1,655
Ending balance at Sep. 30, 2023	$ 60	309,106	(9,766)	1,153	(182,888)	$ 117,665
Ending balance (in shares) at Sep. 30, 2023	57,497
Beginning balance at Apr. 01, 2023	$ 59	303,185	(7,625)	1,150	(179,700)	117,069
Beginning balance (in shares) at Apr. 01, 2023	56,203
Increase (Decrease) in Stockholders' Equity
Net Income (Loss)					(671)	(671)
Issuance of shares in connection with stock option exercise		446				446
Issuance of shares in connection with stock option exercise (in shares)	279
Issuance of shares in connection with restricted stock units vesting (in shares)	431
Issuance of shares in connection with BOD Fees		5				5
Issuance of shares in connection with BOD Fees (in shares)	1
Share-based compensation		2,937				2,937
Stock repurchase		(5)	(1,047)			(1,052)
Unrealized gain (loss) on deferred compensation trust assets				24		24
Ending balance at Jul. 01, 2023	$ 59	306,568	(8,672)	1,174	(180,371)	118,758
Ending balance (in shares) at Jul. 01, 2023	56,914
Increase (Decrease) in Stockholders' Equity
Net Income (Loss)					(2,517)	(2,517)
Issuance of shares in connection with stock option exercise	$ 1	635				636
Issuance of shares in connection with stock option exercise (in shares)	404
Issuance of shares in connection with restricted stock units vesting (in shares)	105
Issuance of shares in connection with BOD Fees		6				6
Issuance of shares in connection with BOD Fees (in shares)	1
Issuance of shares in connection with ESPP		262				262
Issuance of shares in connection with ESPP (in shares)	73
Share-based compensation		1,640				1,640
Stock repurchase		(5)	(1,094)			(1,099)
Unrealized gain (loss) on deferred compensation trust assets				(21)		(21)
Ending balance at Sep. 30, 2023	$ 60	$ 309,106	$ (9,766)	$ 1,153	$ (182,888)	$ 117,665
Ending balance (in shares) at Sep. 30, 2023	57,497

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2023	Oct. 01, 2022
Operating activities
Net income	$ (2,137)	$ 5,273
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense	12,596	9,671
Amortization of intangible assets	28	81
Share-based compensation expense	8,158	7,786
Stock awards issued for non-employee director service	17	17
Stock awards related to officers and directors stock purchase plan from payroll deferral	0	27
Gain from disposition of assets	(75)	(41)
Amortization of deferred financing costs	49	37
Changes in operating assets and liabilities:
Accounts receivable	(3,185)	(4,624)
Inventory	11,616	(15,900)
Other current assets	1	(124)
Other non-current assets	(199)	(745)
Accounts payable and accrued expenses	31,208	4,524
Other current liabilities	386	(315)
Right-of-use obligation - operating leases - current	613	279
Right-of-use obligation - operating leases - long-term	(723)	(108)
Other non-current liabilities	(488)	(136)
Net cash provided by operating activities	57,865	5,702
Investing activities
Additions to property and equipment	(7,380)	(10,546)
Proceeds from sale of property and equipment	83	44
Net cash used in investing activities	(7,297)	(10,502)
Financing activities
Borrowings from revolving loan payable	159	10,351
Payments made on revolving loan payable	(159)	(5,351)
Payments on finance leases	(3,592)	(3,099)
Repurchase of treasury stock	(2,151)	0
Net proceeds from issuance of common stock for ESPP	483	794
Proceeds from exercise of stock options	2,604	1,113
Net cash used in financing activities	(2,656)	3,808
Effect of exchange rate changes on cash	0	(498)
Net change in cash and cash equivalents	47,912	(1,490)
Cash and cash equivalents, beginning of period	18,767	18,144
Cash and cash equivalents, end of period	66,679	16,654
Supplemental disclosure of non-cash investing and financing activities:
Right-of-use finance asset acquired	784	7,889
Accrued asset purchases	658	859
Share-based compensation expense capitalized in property and equipment	589	1,051
Stock issued for services	0	81
Supplemental disclosure of cash flow information:
Cash paid during the period for income taxes	180	175
Cash paid during the period for interest	999	1,011
Cash (received) paid during the period for interest (income) expense, net	$ 1,365	$ 7

Basis of Presentation and Descr

Basis of Presentation and Description of Company	9 Months Ended
Basis of Presentation and Description of Company	Sep. 30, 2023
Basis of Presentation and Description of Company
Basis of Presentation and Description of Company	Note 1 – Basis of Presentation and Description of Company CarParts.com, Inc. (including its subsidiaries) is a leading online provider of aftermarket auto parts and accessories. The Company sells its products primarily to individual consumers through its flagship website located at www.carparts.com www.carparts.com/investor The Company’s products consist of replacement parts serving the wear and tear and body repair market, hard parts to serve the maintenance and repair market, and performance parts and accessories. The replacement parts category is primarily comprised of body parts for the exterior of an automobile as well as certain other mechanical or electrical parts that are not related to the functioning of the engine or drivetrain. Our parts in this category typically replace original body parts that have been damaged as a result of general wear and tear or a collision. In addition, we sell an extensive line of mirror products, including parts from our own house brand called Kool-Vue ® ® ® The Company is a Delaware C corporation and is headquartered in Torrance, California. The Company has employees located in both the United States and the Philippines. Basis of Presentation The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions to U.S. Securities and Exchange Commission (“SEC”) Form 10-Q and Article 10 of SEC Regulation S-X. In the opinion of management, the accompanying consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary to present fairly the consolidated financial position of the Company as of September 30, 2023 and the consolidated results of operations and cash flows for the thirteen and thirty-nine weeks ended September 30, 2023 and October 1, 2022. The Company’s results for the interim periods are not necessarily indicative of the results that may be expected for any other interim period, or for the full year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on March 8, 2023 and all our other periodic filings, including Current Reports on Form 8-K, filed with the SEC after the end of our 2022 fiscal year, and throughout the date of this report. Effective July 3, 2022, management reassessed our functional currency determination for our Philippines subsidiary in accordance with ASC 830, Foreign Currency Matters Based on our current operating plan, we believe that our existing cash, cash equivalents, investments, cash flows from operations and available debt financing will be sufficient to finance our operational cash needs through at least the next twelve months.

Borrowings

Borrowings	9 Months Ended
Borrowings	Sep. 30, 2023
Borrowings
Borrowings	Note 2 – Borrowings The Company maintains an asset-based revolving credit facility ("Credit Facility") that provides for, among other things, a revolving commitment, which is subject to a borrowing base derived from certain receivables, inventory, and property and equipment. The Credit Facility provides for the revolving commitment in an aggregated principal amount of $75,000 and allows for an uncommitted ability to increase the aggregate principal amount by an additional $75,000 to $150,000, subject to certain terms and conditions. The Credit Facility matures on June 17, 2027. As of September 30, 2023 and December 31, 2022, our outstanding revolving loan balance was $0, respectively. As of September 30, 2023 and December 31, 2022, the outstanding standby letters of credit balance was $1,100 and $620, respectively, and we had $0 of our trade letters of credit outstanding in accounts payable in our consolidated balance sheets. Loans drawn under the Credit Facility bear interest, at the Company’s option, at a per annum rate equal to either (a) Adjusted Secured Overnight Financing Rate (“SOFR”) plus an applicable margin of 1.50% to 2.00% per annum based on the Company's fixed charge coverage ratio, or (b) an “alternate prime base rate” subject to an increase from 0.00% to 0.50% per annum based on the Company’s fixed charge coverage ratio. As of September 30, 2023, the Company’s SOFR based interest rate was 6.92% and the Company’s prime based rate was 8.50%. A commitment fee, based upon undrawn availability under the Credit Facility bearing interest at a rate of either 0.20% or 0.25% per annum based on the amount of undrawn availability, is payable monthly. Under the terms of the credit agreement with JPMorgan Chase Bank, N.A. (the “Credit Agreement”), cash receipts are deposited into a lock-box, which are at the Company’s discretion unless the “cash dominion period” is in effect, during which cash receipts will be used to reduce amounts owing under the Credit Agreement. The cash dominion period is triggered in an event of default or if “excess availability,” as defined under the Credit Agreement, is less than $9,000 (12% of the aggregate revolving commitment) for three three

Stockholders' Equity and Share-

Stockholders' Equity and Share-Based Compensation	9 Months Ended
Stockholders' Equity and Share-Based Compensation	Sep. 30, 2023
Stockholders' Equity and Share-Based Compensation
Stockholders' Equity and Share-Based Compensation	Note 3 – Stockholders’ Equity and Share-Based Compensation Options and Restricted Stock Units The Company had the following common stock option activity during the thirty-nine weeks ended September 30, 2023: ● Granted options to purchase 0 common shares. ● Exercise of 1,655 options to purchase common shares. ● Forfeiture of 68 option to purchase common shares. ● Expiration of 9 options to purchase common shares. The following table summarizes the Company’s restricted stock unit ("RSU") activity for the thirty-nine weeks ended September 30, 2023, and details regarding the awards outstanding and exercisable as of September 30, 2023 (in thousands): Weighted Average Grant Date Aggregate Shares Fair Value Intrinsic Value Vested and expected to vest as of December 31, 2022 3,132 Awarded 2,239 Vested (1,032) Forfeited (724) Awards outstanding, September 30, 2023 3,615 $ 9.27 $ 14,893 Vested and expected to vest as of September 30, 2023 3,613 $ 9.27 $ 14,886 During the thirty-nine weeks ended September 30, 2023, 756 RSUs that vested were time-based and 276 were performance-based. For the thirteen and thirty-nine weeks ended September 30, 2023, we recorded compensation costs related to stock options and RSUs of $1,640 and $8,747, respectively. For the thirteen and thirty-nine weeks ended October 1, 2022, we recorded compensation costs related to stock options and RSUs of $3,760 and $8,837, of which $0 and $81 related to common shares issued to consultants as part of their compensation for services provided during those respective periods. As of September 30, 2023, there was unrecognized compensation expense related to stock options and RSUs of $21,325 that will be expensed through September 2027. Stock Repurchase Program On July 27, 2021, the Company’s Board of Directors authorized a stock repurchase program under which the Company may purchase up to $30 million of the Company’s common stock from time to time. The repurchases of common stock may be executed through open market purchases, block trades, the implementation of a 10b5-1 plan, and/or any other available methods. During the thirteen weeks ended September 30, 2023, the Company repurchased 245 shares of its common stock at a total cost of $1,094, excluding commissions, at an average price of $4.47. During the thirty-nine weeks ended September 30, 2023, the Company repurchased 495 shares of its common stock at a total cost of $2,141, excluding commissions, at an average price of $4.33 per share. During the thirteen and thirty-nine weeks ended October 1, 2022, the Company did not repurchase any shares of its common stock. As of September 30, 2023, the Company remained authorized to repurchase up to approximately $27,379 in shares of its common stock.

Net (Loss) Income Per Share

Net (Loss) Income Per Share	9 Months Ended
Net (Loss) Income Per Share	Sep. 30, 2023
Net (Loss) Income Per Share
Net (Loss) Income Per Share	Note 4 – Net (Loss) Income Per Share The following table sets forth the computation of basic and diluted net (loss) income per share (in thousands, except per share data): Thirteen Weeks Ended Thirty-Nine Weeks Ended September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 Net (loss) income per share: Numerator: Net (loss) income allocable to common shares $ (2,517) $ (948) (2,137) 5,273 Denominator: Weighted-average common shares outstanding (basic) 57,179 54,481 56,252 54,009 Common equivalent shares from common stock options and restricted stock — — — 3,274 Weighted-average common shares outstanding (diluted) 57,179 54,481 56,252 57,283 Basic net (loss) income per share $ (0.04) $ (0.02) $ (0.04) $ 0.10 Diluted net (loss) income per share $ (0.04) $ (0.02) $ (0.04) $ 0.09 Options and RSUs that were antidilutive and not included in the dilutive earnings per share calculation for the thirty-nine weeks ended October 1, 2022 amounted to 1,590. For the thirteen and thirty-nine weeks ended September 30, 2023 and the thirteen weeks ended October 1, 2022, all outstanding potentially dilutive securities have been excluded from the calculation of diluted net loss per share as the effect of including such securities would have been anti-dilutive.

Income Taxes

Income Taxes	9 Months Ended
Income Taxes	Sep. 30, 2023
Income Taxes
Income Taxes	Note 5 – Income Taxes The Company is subject to U.S. federal income tax as well as income tax of foreign and state tax jurisdictions. The tax years 2018-2022 remain open to examination by the major taxing jurisdictions to which the Company is subject, except the Internal Revenue Service for which the tax years 2019-2022 remain open. For the thirteen and thirty-nine weeks ended September 30, 2023, the effective tax rate for the Company was (4.7)% and (22.7)%, respectively. The effective tax rate differed from the U.S. federal statutory rate primarily due to state income taxes, income of our Philippines subsidiary that is subject to different tax rates, share-based compensation that is either not deductible for tax purposes or for which the tax deductible amount is different than the financial reporting amount, and a change in the valuation allowance that offset the tax on the current period pre-tax loss. For the thirteen and thirty-nine weeks ended October 1, 2022, the effective tax rate for the Company was (5.5)% and 2.2%, respectively. The effective tax rate differed from the U.S. federal statutory rate primarily due to state income taxes, income of our Philippines subsidiary that is subject to different tax rates, share-based compensation that is either not deductible for tax purposes or for which the tax deductible amount is different than the financial reporting amount, and a change in the valuation allowance that offset the tax of the current period pre-tax (loss) income. The Company accounts for income taxes in accordance with ASC Topic 740 - Income Taxes (“ASC 740”). Under the provisions of ASC 740, management is required to evaluate whether a valuation allowance should be established against its deferred tax assets. We currently have a full valuation allowance against our deferred tax assets. As of each reporting date, the Company’s management considers new evidence, both positive and negative, that could impact management’s view with regard to future realization of deferred tax assets. For the thirty-nine weeks ended September 30, 2023, there was no material change from fiscal year ended December 31, 2022 in the amount of the Company's deferred tax assets that are not considered to be more likely than not to be realized in future years.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
Commitments and Contingencies	Sep. 30, 2023
Commitments and Contingencies.
Commitments and Contingencies	Note 6 – Commitments and Contingencies Legal Matters Asbestos . Ordinary course litigation. who was directly employed by the Company’s third party labor contracting firm at the Company’s Grand Prairie, TX warehouse has filed a negligence claim in the Superior Court of the State of California, Los Angeles County, Central District relating to a workplace injury from March 2021. The case is in the discovery stage, and trial is currently scheduled for 2024. The Company intends to defend itself vigorously, although there can be no assurance that there will not be some liability.

Product Information

Product Information	9 Months Ended
Product Information	Sep. 30, 2023
Product Information
Product Information	Note 7 – Product Information As described in Note 1 above, the Company’s products consist of replacement parts serving the wear and tear and body repair market, hard parts to serve the maintenance and repair market, and performance parts and accessories. The following table summarizes the approximate distribution of the Company’s revenue by product type. Thirteen Weeks Ended Thirty-Nine Weeks Ended September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 House Brands Replacement Parts 64 % 68 % 65 % 67 % Hard Parts 19 % 18 % 19 % 20 % Performance 1 % 1 % 1 % 1 % Branded Replacement Parts 1 % 1 % 1 % 1 % Hard Parts 9 % 7 % 8 % 7 % Performance 6 % 5 % 6 % 4 % Total 100 % 100 % 100 % 100 %

Basis of Presentation and Des_2

Basis of Presentation and Description of Company (Policies)	9 Months Ended
Basis of Presentation and Description of Company (Policies)	Sep. 30, 2023
Basis of Presentation and Description of Company
Basis of Presentation	Basis of Presentation The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial information and with the instructions to U.S. Securities and Exchange Commission (“SEC”) Form 10-Q and Article 10 of SEC Regulation S-X. In the opinion of management, the accompanying consolidated financial statements contain all adjustments, consisting of normal recurring adjustments, necessary to present fairly the consolidated financial position of the Company as of September 30, 2023 and the consolidated results of operations and cash flows for the thirteen and thirty-nine weeks ended September 30, 2023 and October 1, 2022. The Company’s results for the interim periods are not necessarily indicative of the results that may be expected for any other interim period, or for the full year. These unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2022, which was filed with the SEC on March 8, 2023 and all our other periodic filings, including Current Reports on Form 8-K, filed with the SEC after the end of our 2022 fiscal year, and throughout the date of this report. Effective July 3, 2022, management reassessed our functional currency determination for our Philippines subsidiary in accordance with ASC 830, Foreign Currency Matters Based on our current operating plan, we believe that our existing cash, cash equivalents, investments, cash flows from operations and available debt financing will be sufficient to finance our operational cash needs through at least the next twelve months.

Stockholders' Equity and Shar_2

Stockholders' Equity and Share-Based Compensation (Tables)	9 Months Ended
Stockholders' Equity and Share-Based Compensation (Tables)	Sep. 30, 2023
Stockholders' Equity and Share-Based Compensation
Summary of Restricted Stock Unit Activity	The following table summarizes the Company’s restricted stock unit ("RSU") activity for the thirty-nine weeks ended September 30, 2023, and details regarding the awards outstanding and exercisable as of September 30, 2023 (in thousands): Weighted Average Grant Date Aggregate Shares Fair Value Intrinsic Value Vested and expected to vest as of December 31, 2022 3,132 Awarded 2,239 Vested (1,032) Forfeited (724) Awards outstanding, September 30, 2023 3,615 $ 9.27 $ 14,893 Vested and expected to vest as of September 30, 2023 3,613 $ 9.27 $ 14,886

Net (Loss) Income Per Share (Ta

Net (Loss) Income Per Share (Tables)	9 Months Ended
Net (Loss) Income Per Share (Tables)	Sep. 30, 2023
Net (Loss) Income Per Share
Computation of Basic and Diluted Net Income (Loss) Per Share	The following table sets forth the computation of basic and diluted net (loss) income per share (in thousands, except per share data): Thirteen Weeks Ended Thirty-Nine Weeks Ended September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 Net (loss) income per share: Numerator: Net (loss) income allocable to common shares $ (2,517) $ (948) (2,137) 5,273 Denominator: Weighted-average common shares outstanding (basic) 57,179 54,481 56,252 54,009 Common equivalent shares from common stock options and restricted stock — — — 3,274 Weighted-average common shares outstanding (diluted) 57,179 54,481 56,252 57,283 Basic net (loss) income per share $ (0.04) $ (0.02) $ (0.04) $ 0.10 Diluted net (loss) income per share $ (0.04) $ (0.02) $ (0.04) $ 0.09

Product Information (Tables)

Product Information (Tables)	9 Months Ended
Product Information (Tables)	Sep. 30, 2023
Product Information
Summary of Revenue by Product Type	Thirteen Weeks Ended Thirty-Nine Weeks Ended September 30, 2023 October 1, 2022 September 30, 2023 October 1, 2022 House Brands Replacement Parts 64 % 68 % 65 % 67 % Hard Parts 19 % 18 % 19 % 20 % Performance 1 % 1 % 1 % 1 % Branded Replacement Parts 1 % 1 % 1 % 1 % Hard Parts 9 % 7 % 8 % 7 % Performance 6 % 5 % 6 % 4 % Total 100 % 100 % 100 % 100 %

Borrowings (Details)

Borrowings (Details) - USD ($) $ in Thousands	9 Months Ended
Borrowings (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022	Jun. 17, 2022
JP Morgan \| Revolving Credit Facility
Borrowings
Current borrowing capacity			$ 75,000
Maximum borrowing capacity			150,000
Increased aggregate borrowing capacity			$ 75,000
Revolving loan payable	$ 0
Credit facility trigger amount	$ 9,000
Consecutive business days below minimum excess availability	3 days
Number of consecutive days excess availability is above required amount	45 days
Minimum availability required under availability block	$ 7,500
Consecutive business days below minimum excess availability related to covenant testing trigger period	3 days
Minimum fixed charge ratio if less than minimum excess availability	1
Number of consecutive days excess availability related to covenant testing trigger period	45 days
Credit facility trigger amount as a percent of aggregate revolving commitment (in percent)	12%
Event of default amount	$ 0
Minimum availability required under availability block as a percentage of aggregate revolving commitment (in percent)	10%
JP Morgan \| Revolving Credit Facility \| Minimum
Borrowings
Unused credit commitment fee (percent)	0.25%
JP Morgan \| Revolving Credit Facility \| Maximum
Borrowings
Unused credit commitment fee (percent)	0.20%
JP Morgan \| Letter of Credit
Borrowings
Maximum borrowing capacity	$ 1,100	$ 620
Outstanding letters of credit amount	$ 0
Adjusted Secured Overnight Financing Rate (SOFR) \| Revolving Credit Facility \| Minimum
Borrowings
Applicable margin on the company's fixed charge coverage ratio (percent)	1.50%
Adjusted Secured Overnight Financing Rate (SOFR) \| Revolving Credit Facility \| Maximum
Borrowings
Applicable margin on the company's fixed charge coverage ratio (percent)	2%
Adjusted Secured Overnight Financing Rate (SOFR) \| JP Morgan \| Revolving Credit Facility
Borrowings
Interest rate (percent)	6.92%
Base Rate \| JP Morgan \| Revolving Credit Facility
Borrowings
Interest rate (percent)	8.50%
Prime rate \| Revolving Credit Facility \| Minimum
Borrowings
Applicable margin on the company's fixed charge coverage ratio (percent)	0%
Prime rate \| Revolving Credit Facility \| Maximum
Borrowings
Applicable margin on the company's fixed charge coverage ratio (percent)	0.50%

Stockholders' Equity and Shar_3

Stockholders' Equity and Share-Based Compensation - Summary of Stock Option Activity (Details) shares in Thousands	9 Months Ended
	Sep. 30, 2023 shares
Shares
Granted (in shares)	0
Exercised (in shares)	(1,655)
Cancelled:
Forfeited (in shares)	(68)
Expired (in shares)	(9)

Stockholders' Equity and Shar_4

Stockholders' Equity and Share-Based Compensation - Summary of Restricted Stock Unit Activity (Details) shares in Thousands, $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($) $ / shares shares
Restricted stock units
Shares
Vested and expected to vest as of December 31, 2022 (in shares)	3,132
Awarded (in shares)	2,239
Vested (in shares)	(1,032)
Forfeited (in shares)	(724)
Awards outstanding, July 1, 2023 (in shares)	3,615
Vested and expected to vest as of July 1, 2023 (in shares)	3,613
Weighted Average Exercise Price
Awards outstanding, weighted average exercise price, ending balance (in usd per share) \| $ / shares	$ 9.27
Vested and expected to vest, weighted average exercise price, ending balance (in usd per share) \| $ / shares	9.27
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Additional Disclosures [Abstract]
Awards outstanding, Aggregate Intrinsic Value \| $	$ 14,893
Vested and expected to vest, Aggregate Intrinsic Value \| $	$ 14,886
Time Based RSU
Shares
Vested (in shares)	(756)
Performance based RSU
Shares
Vested (in shares)	(276)

Stockholders' Equity and Shar_5

Stockholders' Equity and Share-Based Compensation - Restricted Stock Units (Details) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Oct. 01, 2022	Sep. 30, 2023	Oct. 01, 2022
Stock options and Restricted stock units
Stockholders' Equity and Share-Based Compensation
Compensation costs	$ 1,640	$ 3,760	$ 8,747	$ 8,837
Unrecognized compensation expense	$ 21,325		$ 21,325
Stock options and Restricted stock units \| Consultant
Stockholders' Equity and Share-Based Compensation
Compensation costs		$ 0		$ 81
Restricted stock units
Stockholders' Equity and Share-Based Compensation
Vested (in shares)			1,032
Time Based RSU
Stockholders' Equity and Share-Based Compensation
Vested (in shares)			756
Performance based RSU
Stockholders' Equity and Share-Based Compensation
Vested (in shares)			276

Stockholders Equity and Share-B

Stockholders Equity and Share-Based Compensation - Stock Repurchase Program (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2023	Oct. 01, 2022	Jul. 27, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for repurchase				$ 30,000
Payments for repurchase of common stock		$ 2,151	$ 0
Treasury Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Average price per share of shares repurchased	$ 4.47	$ 4.33
Stock repurchased during period, shares	245,000	495,000	0
Payments for repurchase of common stock	$ 1,094	$ 2,141
Remained authorized to repurchase	$ 27,379	$ 27,379

Net (Loss) Income Per Share (De

Net (Loss) Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Oct. 01, 2022	Sep. 30, 2023	Oct. 01, 2022
Net (Loss) Income Per Share
Net (loss) income allocable to common shares	$ (2,517)	$ (948)	$ (2,137)	$ 5,273
Common equivalent shares from common stock options and restricted stock	0	0	0	3,274
Weighted-average common shares outstanding (basic)	57,179	54,481	56,252	54,009
Weighted-average common shares outstanding (diluted)	57,179	54,481	56,252	57,283
Basic net (loss) income per share	$ (0.04)	$ (0.02)	$ (0.04)	$ 0.10
Diluted net (loss) income per share	$ (0.04)	$ (0.02)	$ (0.04)	$ 0.09

Net (Loss) Income Per Share - A

Net (Loss) Income Per Share - Anti-Dilutive Securities (Details) shares in Thousands	9 Months Ended
	Oct. 01, 2022 shares
Net (Loss) Income Per Share
Anti-dilutive securities excluded from calculation of diluted earnings per share (in shares)	1,590

Income Taxes (Details)

Income Taxes (Details)	3 Months Ended		9 Months Ended
Income Taxes (Details)	Sep. 30, 2023	Oct. 01, 2022	Sep. 30, 2023	Oct. 01, 2022
Income Taxes
Effective tax rate	(4.70%)	(5.50%)	(22.70%)	2.20%

Product Information - Summary o

Product Information - Summary of Segment Percentages (Details) - Sales Revenue, Product Line - Product Concentration Risk	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Oct. 01, 2022	Sep. 30, 2023	Oct. 01, 2022
Product Information
Concentration risk percentage	100%	100%	100%	100%
House Brands, Replacement Parts
Product Information
Concentration risk percentage	64%	68%	65%	67%
House Brands, Hard Parts
Product Information
Concentration risk percentage	19%	18%	19%	20%
House Brands, Performance
Product Information
Concentration risk percentage	1%	1%	1%	1%
Branded, Replacement Parts
Product Information
Concentration risk percentage	1%	1%	1%	1%
Branded, Hard Parts
Product Information
Concentration risk percentage	9%	7%	8%	7%
Branded, Performance
Product Information
Concentration risk percentage	6%	5%	6%	4%

Pay vs Performance Disclosure

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 30, 2023	Jul. 01, 2023	Apr. 01, 2023	Oct. 01, 2022	Jul. 02, 2022	Apr. 02, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ (2,517)	$ (671)	$ 1,051	$ (948)	$ 4,118	$ 2,103

Insider Trading Arrangements

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 30, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false