RESTRUCTURING CHARGES, NET

9 Months Ended

Mar. 26, 2023

Restructuring and Related Activities [Abstract]

RESTRUCTURING CHARGES, NETThe Company records employee severance and separation costs that meet the requirements for recognition in accordance with the relevant guidance of ASC 420, Exit or Disposal Cost Obligations, or ASC 712, Compensation - Non-retirement Post-employment Benefits, as applicable. For involuntary termination benefits that are not provided under the terms of an ongoing benefit arrangement, the liability for the current fair value of expected future costs associated with a management-approved restructuring plan is recognized in the period in which the plan is communicated to the employees and the plan is not expected to change significantly. For ongoing benefit arrangements, inclusive of statutory requirements, employee termination costs are accrued when the existing situation or set of circumstances indicates that an obligation has been incurred, it is probable the benefits will be paid, and the amount can be reasonably estimated. Termination benefits associated with employees that elected to voluntarily terminate as part of the restructuring plan are recorded when the employee irrevocably accepts the offer and the amount can be reasonably estimated. If applicable, the Company records such costs into operating expense over the terminated employees’ future service period beyond any minimum or legally required retention period. The majority of restructuring charges that have been incurred but not yet paid are recorded in Accrued expenses and other current liabilities in the Condensed Consolidated Balance Sheets.

In the three and nine months ended March 26, 2023, the Company initiated a restructuring plan designed to better align the Company’s cost structure with its outlook for the economic environment and business opportunities. Under the plan the Company terminated approximately 1,400 employees, incurring expenses related to employee severance and separation costs. Employee severance and separation costs primarily relate to severance, non-cash severance, including equity award compensation expense, pension and other termination benefits. Additionally, the Company made a strategic decision to relocate certain manufacturing activities to pre-existing facilities.

During the three and nine months ended March 26, 2023, net restructuring costs of $66.7 million and $40.4 million were recorded in restructuring charges, net - cost of goods sold, and restructuring charges, net - operating expenses, respectively in the Condensed Consolidated Statements of Operations.

The Company anticipates the restructuring plan to be substantially complete by December 24, 2023, and estimates that incremental restructuring charges totaling approximately $40 million will be incurred through the fiscal quarter ending December 24, 2023.

The following table is a summary of the activity related to the restructuring plan:


	Severance and Benefits		Other		Total
	(in thousands)
Restructuring expense	$	98,508	$	8,620	$	107,128
Cash payments	(20,658)		(2,967)		(23,625)
Non-cash activities	(2,269)		(794)		(3,063)
Restructuring liability as of March 26, 2023	$	75,581	$	4,859	$	80,440