STCN Steel Connect Inc

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Steel Connect, Inc. (the "Company" or "Steel Connect"), is a holding company which operates through its wholly-owned subsidiary ModusLink Corporation ("ModusLink" or "Supply Chain").

ModusLink is a supply chain business process management company serving clients in markets such as consumer electronics, communications, computing, medical devices, software and retail. ModusLink designs and executes elements in its clients' global supply chains to improve speed to market, product customization, flexibility, cost, quality and service. The Company also produces and licenses an entitlement management solution for activation, provisioning, entitlement subscription and data collection from physical goods (connected products) and digital products.

Steel Partners and Steel Connect Exchange Transaction

On April 30, 2023, Steel Partners Holdings L.P., (“Steel Holdings”) and the Company executed a series of agreements in which Steel Holdings and certain of its affiliates (the “Steel Partners Group”) agreed to transfer certain marketable securities held by the Steel Partners Group to the Company in exchange for 3.5 million shares of Series E Convertible Preferred Stock of the Company (the “Series E Convertible Preferred Stock”, and, such transfer and related transactions, the “Exchange Transaction”). The Exchange Transaction closed on May 1, 2023, which is the date that the consideration was exchanged between Steel Holdings and the Company. See Note 4 - "Exchange Transaction" for further information regarding the Exchange Transaction.

The accompanying condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of a normal recurring nature) considered necessary for fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes for the year ended July 31, 2023 (Fiscal Year 2023), which are contained in the Company's Fiscal Year 2023 Form 10-K filed on November 8, 2023, as amended on November 28, 2023. Certain prior year amounts have been reclassified to conform to current year presentation. The results for the nine months ended April 30, 2024 are not necessarily indicative of the results to be expected for the full fiscal year. The year-end condensed consolidated balance sheet data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP.

Predecessor/Successor Reporting

On May 1, 2023, the Exchange Transaction resulted in Steel Holdings obtaining control of the Company for financial statement consolidation purposes. Steel Holdings does not consolidate the Company for Federal income tax purposes because the ownership in the Company is dispersed between different federal tax consolidation groups within Steel Holdings. As of May 1, 2023, the Company elected pushdown accounting in which it used Steel Holdings' basis of accounting, which reflected the fair market value of the Company’s assets and liabilities at the date of the Exchange Transaction. As a result, the Company has reflected the required pushdown accounting adjustments in its consolidated financial statements. Due to the application of pushdown accounting, the Company’s consolidated financial statements and certain footnote disclosures include a black line division between the two distinct periods to indicate the application of two different bases of accounting, which may not be comparable, between the periods presented. The pre-exchange period through April 30, 2023 is referred to as the "Predecessor" period. The post-exchange period, May 1, 2023 and onward, includes the impact of pushdown accounting and is referred to as the "Successor" period. As such for purposes of this quarterly report, all references to the three and nine months ended April 30, 2024 are for the Successor period, and all references to the three and nine months ended April 30, 2023 are for the Predecessor period. See Note 4 - "Exchange Transaction" for further information regarding the Exchange Transaction and the application of pushdown accounting.

Reverse/Forward Stock Split

At the special stockholders meeting held on June 6, 2023, the stockholders approved proposals to amend the Company’s restated certificate of incorporation (the “Charter”), to effect a 1-for-3,500 reverse stock split of the common stock (the “Reverse Stock Split”), followed immediately by a 375-for-1 forward stock split of the common stock (the “Forward Stock Split,” and, together with the Reverse Stock Split, the “Reverse/Forward Stock Split”). On June 7, 2023, Steel Connect's Board of Directors ("the Board") approved the Reverse/Forward Stock Split, and as such, the Board directed the Company to file with the State of

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Delaware certificates of amendment to our Charter to effectuate the Reverse/Forward Stock Split. The Reverse/Forward Stock Split was effective on June 21, 2023 (the “Effective Date”). The Company’s common stock began trading on a Reverse/Forward Stock Split-adjusted basis on the Nasdaq Capital Market when the market opened on June 22, 2023. The trading symbol for the Company’s common stock remains “STCN.” Accordingly, all share and per-share amounts for the current period and prior periods have been adjusted to reflect the Reverse/Forward Stock Split.

Summary of Significant Accounting Policies

Interest income is recognized when earned.

All intercompany transactions and balances have been eliminated in consolidation.

The Company considers events or transactions that occur after the balance sheet date but before the issuance of financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. For the nine months ended April 30, 2024, the Company evaluated subsequent events for potential recognition and disclosure through the date these financial statements were filed.

The following significant accounting policy has been added from the policies described in the Fiscal Year 2023 Form 10-K:

Investments

Long-term investments consist of debt and equity securities. The Company determines the appropriate classifications of its investments at the acquisition date and re-evaluates the classifications at each balance sheet date.

Equity securities that do not result in consolidation and are not accounted for under the equity method are measured at fair value, with any changes recognized in Other (losses) gains, net in the consolidated statements of operations in accordance with Accounting Standards Codification ("ASC") Topic 321, Investments - Equity Securities. The Company uses quoted market prices to determine the fair value of equity securities with readily determinable fair value.

Available-for-sale debt securities are reported at fair value, with unrealized gains and losses recognized in accumulated other comprehensive income or loss as a separate component of the Company's stockholders' equity in accordance with ASC Topic 320, Investments - Debt Securities. To the extent that debt securities meet the definition of a hybrid security under ASC 815, Derivatives and Hedging, the Company may elect the fair value option under ASC 825, Financial Instruments to measure the entire hybrid instrument, with changes in fair value recorded in the Company's consolidated statements of operations.

Accounting Standards Issued and Not Yet Implemented

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which is intended to enhance the transparency, decision usefulness and effectiveness of income tax disclosures. The new guidance requires disaggregated information about the effective tax rate reconciliation and additional information on taxes paid that meet a quantitative threshold. The new guidance is effective for annual reporting periods beginning after December 15, 2024, with early adoption and retrospective application permitted. This guidance will be effective for the Company beginning in the fourth quarter in the fiscal year ending July 31, 2026. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statement disclosures; however, adoption is not expected to impact its consolidated balance sheets or statement of operations.

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, allowing financial statement users to better understand the components of a segment's profit or loss to assess potential future cash flows for each reportable segment and the entity as a whole. The new guidance requires a public entity to disclose significant expenses and other segment items that are regularly reported to the chief operating decision maker ("CODM") and the nature of segment expense information used to manage operations. Additionally, it requires a public entity to disclose the title and position of the CODM. The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. The new guidance is effective for annual reporting periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. This guidance will be effective for the Company beginning in the fourth quarter in the fiscal year ending July 31, 2025. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statement disclosures; however, adoption is not expected to impact its consolidated balance sheets or statements of operations.

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In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40). The amendment in this update simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments and convertible preferred stock. This update also amends the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions and requires the application of the if-converted method for calculating diluted earnings per share. The update also requires entities to provide expanded disclosures about the terms and features of convertible instruments, how the instruments have been reported in the entity's financial statements and information about events, conditions and circumstances that can affect how to assess the amount or timing of an entity's future cash flows related to those instruments. The guidance is effective beginning in the first quarter of our fiscal year ending July 31, 2025, with early adoption permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements; however, adoption is not expected to impact its consolidated balance sheets or statements of operations.

Other new pronouncements issued but not effective until after April 30, 2024 are not expected to have a material impact on our financial condition, results of operations or liquidity.

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Steel Partners and Steel Connect Exchange Transaction

On April 30, 2023, the Company and Steel Holdings executed a series of agreements, in which the Steel Partners Group transferred an aggregate of 3,597,744 shares of common stock, par value $0.10 per share, of Aerojet Rocketdyne Holdings, Inc. ("Aerojet") held by the Steel Partners Group to the Company in exchange for 3.5 million shares of the Company's newly created Series E Convertible Preferred Stock (the “Series E Convertible Preferred Stock” and such transfer and related transactions, the "Exchange Transaction"). Following the approval by the Company's stockholders on June 6, 2023, pursuant to the rules of the Nasdaq Capital Market, the Series E Convertible Preferred Stock is convertible into an aggregate of 19.8 million shares of the Company's common stock, par value $0.01 per share (the “common stock” or “Common Stock”), and votes together with the Company's common stock and participates in any dividends paid on the Company's common stock, in each case on an as-converted basis. Upon conversion of the Series E Convertible Preferred Stock, when combined with the Steel Connect common stock, the 7.50% Convertible Senior Note, if converted, and the Steel Connect Series C Convertible Preferred Stock, also if converted, owned by Steel Holdings, would result in Steel Holdings holding approximately 84.0% of the outstanding equity interests of the Company as of May 1, 2023.

The Exchange Transaction closed on May 1, 2023, the date that the consideration was exchanged between the Company and Steel Holdings, and as of that date the Company became a consolidated subsidiary of Steel Holdings for financial statement purposes. The Company is not consolidated by Steel Holdings for Federal income tax purposes because Steel Holdings' ownership in the Company is dispersed between different federal tax consolidation groups. The Company's assets and liabilities have been included in Steel Holdings' consolidated balance sheet, with a related noncontrolling interest of 16.0% of the Company's common stock. Prior to May 1, 2023, when including the if-converted value of the 7.50% Convertible Senior Note and the Steel Connect Series C Convertible Preferred Stock, Steel Holdings held a 49.6% ownership interest in the Company and accounted for its investment in the Company in accordance with the equity method of accounting. As of the date of the Exchange Transaction, Steel Holdings remeasured the previously held equity method investment to its fair value based upon a valuation of the Company.

The Exchange Transaction was accounted for in accordance with ASC Topic 805, Business Combinations, and, accordingly, the Company's results of operations were consolidated in Steel Holdings' financial statements on the date of the Exchange Transaction. Steel Holdings recorded a preliminary allocation of the Exchange Transaction to assets acquired and liabilities assumed based on their estimated fair values as of May 1, 2023. Steel Holdings' final Exchange Transaction allocation was finalized as of December 31, 2023, with no significant changes to preliminary amounts. As discussed in Note 2 - "Basis of Presentation", the Company elected pushdown accounting in which it uses Steel Holdings' basis of accounting, which reflects the fair market value of the Company’s assets and liabilities at the date of the Exchange Transaction.

The following table summarizes the total Exchange Transaction consideration:

(in thousands)			May 1, 2023
Fair value of Aerojet common stock			$	202,733
Fair value of previously held interest in Steel Connect and noncontrolling interest			111,816
Less: cash acquired from Steel Connect			(65,896)
Total estimated consideration, less cash acquired			$	248,653

The following represents the final calculation of goodwill and fair value amounts recognized. The Company notes that there were no measurement period adjustments made in the current period that would result in an updated preliminary fair value allocation.

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(in thousands)			May 1, 2023
Assets
Accounts receivable, trade			$	36,900
Inventories, net			6,900
Prepaid expenses and other current assets			4,957
Other intangible assets			35,500
Other assets			3,900
Property and equipment, net			3,400
Operating lease right-of-use assets			29,250
Investments			202,733
Estimated fair value of total assets acquired by Steel Holdings			323,540
Liabilities
Accounts payable			26,300
Accrued expenses			29,100
Current lease obligations			7,994
Other current liabilities			7,236
Long-term lease obligations			21,300
Other long-term liabilities			5,742
Estimated fair value of total liabilities assumed by Steel Holdings			97,672
Fair value of identifiable net assets			225,868
Goodwill attributable to Steel Connect			$	22,785

In connection with the application of pushdown accounting, the Company calculated the amount of goodwill recognized based on the excess of the Exchange Transaction consideration over the fair value of net identifiable assets acquired and liabilities assumed. Goodwill is primarily attributable to expected synergies and the assembled workforce of the Company. The goodwill recognized will not be deductible for income tax purposes.

Identifiable intangible assets were recognized at their estimated fair value as of the date of the Exchange Transaction. The fair value of the trade name asset was determined using the relief-from-royalty method and the fair value of the customer relationships asset was determined using the excess earnings method. These income-based approaches included assumptions such as the amount and timing of projected cash flows, growth rates, customer attrition rates, discount rates, and the assessment of the asset’s life cycle. The estimated fair value and estimated remaining useful lives of identifiable intangible assets as of the Exchange Transaction date were as follows:

(in thousands)						Useful Life (Years)						Amount
Customer relationships						7						$	25,000
Trade name						Indefinite						10,500
Estimated fair value of identifiable intangible assets												$	35,500

In connection with the application of pushdown accounting, the Company recorded intangible assets for goodwill, customer relationships and tradenames. A reconciliation of the change in the carrying amount of goodwill by reportable segment is as follows:

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(in thousands)			Supply Chain
Balance at July 31, 2023 (Successor)
Gross goodwill			$	22,785
Accumulated impairments			—
Net goodwill			$	22,785
Balance at April 30, 2024 (Successor)
Gross goodwill			$	22,785
Accumulated impairments			—
Net goodwill			$	22,785

A summary of Other intangible assets, net is as follows:

			Successor
			April 30, 2024																		July 31, 2023
(in thousands)			Gross Carrying Amount						Accumulated Amortization						Net						Gross Carrying Amount						Accumulated Amortization						Net
Customer relationships			$	25,000					$	3,571					$	21,429					$	25,000					$	911					$	24,089
Trade name			10,500						—						10,500						10,500						—						10,500
Total			$	35,500					$	3,571					$	31,929					$	35,500					$	911					$	34,589

The trade name intangible asset has an indefinite useful life. Customer relationships are amortized on a straight-line basis. Amortization expense related to intangible assets was $0.9 million and $2.7 million for the three and nine months ended April 30, 2024, respectively. The Exchange Transaction closed on May 1, 2023, and as such, there was no intangible assets or related amortization expense for the three and nine months ended April 30, 2023.

Based on gross carrying amounts at April 30, 2024, the Company's projection of amortization expense for identifiable intangible assets for the remainder of the fiscal year ending July 31, 2024, and fiscal years 2025 through 2028 and thereafter is presented in the table below:

			Fiscal Year Ending July 31,
(in thousands)			2024						2025						2026						2027						2028						Thereafter
Projected amortization expense			$	893					$	3,571					$	3,571					$	3,571					$	3,571					$	6,252

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The table below presents the components of Inventories, net:

			Successor
			April 30, 2024						July 31, 2023
			(in thousands)
Raw materials			$	6,271					$	4,805
Work-in-process			258						239
Finished goods			945						3,525
			$	7,474					$	8,569

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The following table summarizes the Company's investments as of April 30, 2024. There were no investments as of July 31, 2023.

						Successor
(in thousands)						April 30, 2024
Convertible loan note investment(a)						$	—
Other investments(b)						14,293
Total						$	14,293

(a)    The Company entered into a new convertible loan note on October 13, 2023, which matures on March 31, 2025. The Company paid 1.0 million GBP (approximately $1.2 million) to subscribe for an amount of £1.0 million (the "loan principal") of 11.0% 2025 unsecured convertible loan notes issued by the investee (the "CLN Instrument Agreement"). Contemporaneous with the execution of the CLN Instrument Agreement, the Company executed the Equity Warrant Instrument Agreement (“Warrant Agreement”), which provides the Company with the option to convert the outstanding balance into equity shares of the investee at any time before repayment of the outstanding loan principal balance. The Company’s £1.0 million investment in the £20.0 million GBP 11.0% unsecured convertible loan notes provides it with an approximate 5.0% ownership interest on an if-converted basis. Changes in fair value will be recorded in the Company's condensed consolidated statements of operations as the Company elected the fair value option under ASC 825 to account for this investment. Changes in fair value are recorded in the Company's condensed consolidated statements of operations as the Company elected the fair value option under ASC 825 to account for this investment. In April 2024, the Company became aware that the investee had halted its operations while it undergoes a restructuring process. As a result, the Company determined that the fair value of the investment was zero. The Company recorded a loss of $1.2 million to Other (losses) gains, net on the condensed consolidated statements of operations during the three and nine months ended April 30, 2024, which was the fair value of the investment as of January 31, 2024.

(b)    The balance consists of multiple common stock investments in public companies which are measured at fair value.

The amount of unrealized net losses for the three and nine months ended April 30, 2024 that relate to equity securities still held as of April 30, 2024 are as follows:

						Successor
						Three months ended April 30,						Nine months ended April 30,
(in thousands)						2024						2024
Net losses recognized during the period on equity securities						$	(872)					$	(276)
Less: Net (losses) gains recognized during the period on equity securities sold during the period						(21)						372
Unrealized net losses recognized during the period on equity securities still held at the end of the period						$	(851)					$	(648)

Unrealized net losses are recorded in Other (losses) gains, net on the condensed consolidated statements of operations. There was no investment activity for the three and nine months ended April 30, 2023.

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The following tables reflect the components of "Accrued expenses" and "Other current liabilities".

			Successor
			April 30, 2024						July 31, 2023
Accrued Expenses			(in thousands)
Accrued compensation			$	6,311					$	6,891
Accrued audit, tax and legal			4,027						5,696
Accrued price concessions			2,587						2,981
Accrued taxes			1,796						2,811
Accrued occupancy costs			1,611						1,412
Accrued IT costs			648						831
Accrued travel			535						—
Accrued freight			447						502
Accrued contract labor			372						517
Accrued other			4,723						5,133
Total accrued expenses			$	23,057					$	26,774

			Successor
			April 30, 2024						July 31, 2023
Other Current Liabilities			(in thousands)
Deferred revenue - current			2,762						2,574
Other			1,571						1,970
Total other current liabilities			$	4,333					$	4,544

The table below presents the components of the Company's lease expense:

			Successor												Predecessor						Successor												Predecessor
			Three Months Ended April 30,												Three Months Ended April 30,						Nine Months Ended April 30, 2024												Nine Months Ended April 30, 2023
			2024												2023						2024												2023
			(in thousands)
Operating lease cost			$	2,672											$	2,636					$	7,830											$	7,538
Short-term lease expense			337												394						1,215												1,269
Variable lease cost			—												—						—												7
Sublease income			$	(61)											$	(222)					$	(352)											$	(786)
Total lease expense			$	2,948											$	2,808					$	8,693											$	8,028

Supplemental Cash Flow Information

Supplemental cash flow information related to the Company's leases was as follows:

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			Successor												Predecessor
			Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023
			(in thousands)
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases			$	7,641											$	7,224
Financing cash flows from finance leases			$	—											$	38

The components of debt are presented in the table below:

			Successor
			April 30, 2024						July 31, 2023
			(in thousands)
Unsecured
7.50% Convertible Senior Note due September 1, 2024			$	12,903					$	12,461
Credit Facility
Umpqua Revolver			—						—
Total debt, net			$	12,903					$	12,461

7.50% Convertible Senior Note

On February 28, 2019, the Company entered into a 7.50% Convertible Senior Note Due 2024 Purchase Agreement (the "SPHG Note Purchase Agreement") with SPH Group Holdings LLC ("SPHG Holdings"), whereby SPHG Holdings agreed to loan the Company $14.9 million in exchange for a 7.50% Convertible Senior Note due 2024 (the "SPHG Note"). The SPHG Note was amended on March 9, 2023 (the "Amendment Date"), to extend the maturity date to September 1, 2024. In addition, the Company repaid $2.0 million in principal amount of the SPHG Note during Fiscal Year 2023. Refer to Note 18 - "Fair Value Measurements" for further information.

As of both April 30, 2024 and July 31, 2023, the principal amount of the note was $12.9 million. As of May 1, 2023, or the date of the Exchange Transaction, the Company accounts for the SPHG Note under the fair value option in order to conform with Steel Holdings' basis of accounting, with changes in fair value recognized in earnings. Refer to Note 18 - "Fair Value Measurements" for further information. The fair value of the SPHG Note was reported as a current liability on the condensed consolidated balance sheets beginning in the first quarter of fiscal year 2024, as its maturity is less than twelve months.

Below is a reconciliation of interest expense related to the SPHG Note to total interest expense:

			Successor												Predecessor						Successor												Predecessor
			Three Months Ended April 30,												Three Months Ended April 30,						Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023						2024												2023
			(in thousands)
Interest expense related to contractual interest coupon on the SPHG Note			$	243											$	271					$	739											$	844
Interest expense related to accretion of the discount on the SPHG Note(a)			—												632						—												1,688
Interest expense related to revolving credit facilities (see below)			—												11						—												36
Other			—												—						—												20
Total interest expense			$	243											$	914					$	739											$	2,588

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(a) Prior to the date of the Exchange Transaction, the discount on the SPHG Note was accreted using the effective interest rate method. The effective interest rate on the SPHG Note was 27.8% prior to the SPHG Note Amendment, and was 23.0% subsequent to the SPHG Note Amendment.

Umpqua Revolver

ModusLink, as borrower, is party to a revolving credit agreement with Umpqua Bank as lender and as agent, which provides for a maximum credit commitment of $12.5 million and a sublimit of $5.0 million for letters of credit (collectively, the "Umpqua Revolver"). On May 1, 2024, ModusLink, entered into a Second Amendment to the Umpqua Revolver (the “Second Amendment”). Among other things, the Second Amendment (i) extended the maturity date with respect to revolving loans from March 31, 2025 to March 31, 2026, (ii) removed certain adjustments in the definition of “Adjusted EBITDA” as set forth in the Umpqua Revolver, (iii) increased the minimum Adjusted Tangible Net Worth (as defined in the credit agreement) and (iv) removed certain caps and conditions on ModusLink’s ability to pay dividends.

As of April 30, 2024, ModusLink was in compliance with the Umpqua Revolver's covenants, and believes it will remain in compliance with the Umpqua Revolver’s covenants for the next twelve months from the filing of this Form 10-Q. As of April 30, 2024, ModusLink had available borrowing capacity of $11.9 million and there was $0.6 million outstanding letters of credit.

Donald Reith v. Warren G. Lichtenstein, et al.

On April 13, 2018, a purported shareholder, Donald Reith, filed a verified complaint, Reith v. Lichtenstein, et al., 2018-277 (Del. Ch.) in the Delaware Court of Chancery (the “Reith litigation”). The complaint alleges class and derivative claims for breach of fiduciary duty and/or aiding and abetting breach of fiduciary duty and unjust enrichment against certain current and former directors of the Company, Warren G. Lichtenstein, Glen M. Kassan, William T. Fejes, Jack L. Howard, Jeffrey J. Fenton, Philip E. Lengyel and Jeffrey S. Wald; and stockholders Steel Holdings and several of its affiliated companies (collectively, the "Steel Parties") in connection with the acquisition of $35.0 million of the Series C Convertible Preferred Stock by SPHG Holdings and equity grants made to Messrs. Lichtenstein, Howard and Fejes on December 15, 2017 (collectively, the "Challenged Transactions"). The Company is named as a nominal defendant. The complaint alleges that although the Challenged Transactions were approved by a Special Committee consisting of the independent members of the Board of Directors (Messrs. Fenton, Lengyel and Wald), the Steel Parties dominated and controlled the Special Committee, who approved the Challenged Transactions in breach of their fiduciary duty. Plaintiff alleges that the Challenged Transactions unfairly diluted stockholders and therefore unjustly enriched Steel Holdings, SPHG Holdings and Messrs. Lichtenstein, Howard and Fejes. The complaint also alleges that the Board of Directors made misleading disclosures in the Company's proxy statement for the 2017 Annual Meeting of Stockholders in connection with seeking approval to amend the 2010 Incentive Award Plan to authorize the issuance of additional shares to accommodate certain shares underlying the equity grants. Remedies requested include rescission of the Series C Convertible Preferred Stock and equity grants, disgorgement of any unjustly obtained property or compensation and monetary damages.

On August 13, 2021, the Company, together with certain of its current and former directors of the Board, Warren Lichtenstein, Glen Kassan, William Fejes, Jr., Jack Howard, Jeffrey Fenton and Jeffrey Wald, as well as other named defendants (collectively, the “Defendants”), entered into a memorandum of understanding (the “MOU”) with Donald Reith (the “Plaintiff”) in connection with the settlement of the Reith v. Lichtenstein, et al., C.A. No. 2018-0277-MTZ (Del. Ch. 2018) class and derivative action. A definitive Stipulation of Settlement (the “Stipulation”) incorporating the terms of the MOU was filed with the Court on February 18, 2022. Pursuant to the MOU and Stipulation, and contingent on approval of the terms by the court, the Defendants agreed to cause their directors’ and officers’ liability insurance carriers to pay to the Company $2.8 million in cash. The Company's insurance carrier agreed to pay $1.7 million and Steel Holdings' insurance carrier agreed to pay $1.1 million of the settlement.

Additionally, under the MOU and separate letter agreements between the Company and such individuals (the “Surrender Agreements”), Messrs. Lichtenstein, Howard and Fejes agreed to surrender to the Company an aggregate 353,571 shares that they had initially received in December 2017 in consideration for services to the Company. The surrenders and cancellations are in the following amounts: for Mr. Lichtenstein, 196,429 vested shares and 32,143 unvested shares; for Mr. Howard, 98,214 vested shares and 16,071 unvested shares; and for Mr. Fejes, 10,714 vested shares. On August 17, 2021, Mr. Lichtenstein and Mr. Howard surrendered the shares required under the MOU, the Stipulation and their respective Surrender Agreements, and in December 2021 Mr. Fejes did the same. All such shares were subsequently cancelled. Pursuant to the MOU and Stipulation, the Company also agreed to pay the Plaintiff’s counsel legal fees for this matter in an amount up to $2.05 million, if approved by the court.

On September 23, 2022, the court ruled that it was denying approval of the settlement. On September 12, 2023, the court approved a stipulated pretrial and trial schedule culminating in a trial scheduled for September 2024.

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On June 6, 2023, the Company received a books and records demand from Reith under Delaware General Corporation Law Section 220 which requests an array of documents for the purported purposes of investigating potential wrongdoing in connection with the April 30, 2023 transaction between Steel Holdings and Steel Connect.

On April 8, 2024, the Company, the Defendants and Mr. Reith entered into a new memorandum of understanding (the "New MOU") contemplating the settlement of the Reith litigation (the "2024 Settlement"). If the 2024 Settlement is approved by the Court, (i) the Defendants shall cause their insurers to make a cash payment of $6.0 million to the Company and, after deducting any Court-approved award of attorneys’ fees to Plaintiff's counsel and certain litigation expenses, the Company shall distribute the balance of the cash payment, by way of a special divided or other distribution, to the holders of the Company’s common stock pursuant to the allocation provisions set forth in the previously disclosed Stockholders Agreement dated April 20, 2023 by and among the Company, Steel Partners Holdings L.P., and other stockholders signatory thereto (the “Stockholders’ Agreement”) as amended by the 2024 Settlement; (ii) the Company will adopt certain amendments to the Stockholders’ Agreement; and (iii) the Company will adopt certain corporate governance policies and practices, including a formal review process for compensation clawbacks, enhancing the process for granting equity awards and keeping records of equity awards granted under the Company’s stock plans, further enhancing board committee independence, and reducing the materiality threshold for review of related party transactions under the Stockholders Agreement, in exchange for which all parties will be released from all claims in the Reith litigation. The 2024 Settlement requires Court approval, and there can be no assurances that such approval will be granted.

On December 12, 2023, the Company received books and records demand, similar to the demand from Reith, from another purported shareholder. The possible liability, if any, with respect to this matter cannot be determined.

Mohammad Ladjevardian v. Warren G. Lichtenstein, et al.

On September 1, 2023, a purported stockholder, Mohammad Ladjevardian, filed a verified complaint alleging a single direct claim for breach of fiduciary duty against members of Steel Connect’s Board of Directors and Steel Holdings and certain of its affiliates in connection with the Exchange Transaction. Directors named in the complaint are Warren Lichtenstein, Glen Kassan, and Jack Howard. The complaint alleges that although the challenged transaction was approved by the independent Strategic Planning Committee, the committee failed to obtain a “control premium” or to consider the dilutive effect that the Series E Convertible Preferred Stock issuance had on the plaintiff’s holdings. Remedies requested in the complaint include rescission of the Series E Convertible Preferred Stock and a judicially imposed requirement that all future transactions involving Steel Holdings and its affiliates be subject to minority stockholder approval. On September 27, 2023, the entity defendants moved to dismiss the complaint. On October 5, 2023, the individual defendants moved to dismiss the complaint.

On April 18, 2024, in order to avoid the cost and uncertainty of litigation, Messrs. Lichtenstein and Howard, Steel Holdings, Steel Excel and WebFinancial, without admitting any wrongdoing, entered into a Settlement Agreement and Securities Purchase Agreements (the "SPAs") with the Estate of Mohammad Ladjevardian and certain parties related to Mohammad Ladjevardian (the "Ladjevardian Parties"). Pursuant to the SPAs, a Steel Holdings subsidiary purchased an aggregate of 701,246 shares of the Company’s common stock held by the Ladjevardian Parties at a price of $9.83 per share, which represented the closing market price of the shares on April 17, 2024 and made an aggregate cash settlement payment of $1.5 million to the Ladjevardian Parties.

Disaggregation of Revenue

The following table presents the Company's revenues from contracts with customers disaggregated by major good or service line and timing of revenue recognition. The table also includes a reconciliation of the disaggregated revenue with the reportable segments.

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			Successor												Predecessor						Successor												Predecessor
			Three Months Ended April 30,												Three Months Ended April 30,						Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023						2024												2023
			(in thousands)
Major Goods/Service Lines
Supply chain management services			$	43,456											$	45,826					$	127,157											$	147,185
Other			399												316						1,083												1,098
			$	43,855											$	46,142					$	128,240											$	148,283
Timing of Revenue Recognition
Services transferred over time			$	43,855											$	46,142					$	128,240											$	148,283
			$	43,855											$	46,142					$	128,240											$	148,283

Supply Chain Management Services

ModusLink's revenue primarily comes from the sale of supply chain management services to its clients. Amounts billed to customers under these arrangements include revenue attributable to the services performed as well as for materials procured on the customer's behalf as part of its service to them. The majority of these arrangements consist of two distinct performance obligations (i.e., warehousing/inventory management service and a separate kitting/packaging/assembly service), revenue related to each of which is recognized over time as services are performed using an input method based on the level of efforts expended.

Other

Other revenue consists of cloud-based software subscriptions, software maintenance and support service contracts, and fees for professional services. Revenue related to these arrangements is recognized on a straight-line basis over the term of the agreement or over the term of the agreement in proportion to the costs incurred in satisfying the obligations under the contract.

Contract Balances

Timing of revenue recognition may differ from timing of invoicing to customers. The Company records contract assets and liabilities related to its contracts with customers as follows:

•Accounts receivable when revenue is recognized prior to receipt of cash payments and if the right to such amounts is unconditional and solely based on the passage of time.

•Contract asset when the Company recognizes revenue based on efforts expended but the right to such amount is conditional upon satisfaction of another performance obligation. Contract assets are primarily comprised of fees related to supply chain management services. The Company's contract assets are all short-term in nature and are included in prepaid expenses and other current assets in the condensed consolidated balance sheets.

•Deferred revenue when cash payments are received or due in advance of performance. Deferred revenue is primarily comprised of fees related to supply chain management services, cloud-based software subscriptions and software maintenance and support service contracts, which are generally billed in advance. Deferred revenue also includes other offerings for which we have been paid in advance and earn the revenue when we transfer control of the product or service. The deferred revenue balance is classified as a component of other current liabilities and other long-term liabilities on the Company's condensed consolidated balance sheets.

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The table below presents information for the Company's contract balances:

			Successor																		Predecessor
			April 30, 2024						July 31, 2023												August 1, 2022
			(in thousands)
Accounts receivable, trade, net			$	31,873					$	28,616											$	40,083
Contract assets			283						439												369
Deferred revenue - current			$	2,762					$	2,574											$	2,705
Deferred revenue - long-term			68						144												134
Total deferred revenue			$	2,830					$	2,718											$	2,839

Remaining Performance Obligations

Remaining performance obligations are comprised of deferred revenue. Changes in deferred revenue during the nine months ended April 30, 2024 and April 30, 2023, were as follows:

			Successor												Predecessor
			Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023
			(in thousands)
Balance at beginning of period			$	2,718											$	2,839
Deferral of revenue			1,456												1,595
Recognition of deferred amounts upon satisfaction of performance obligation			(1,344)												(1,361)
Balance at end of period			$	2,830											$	3,073

The Company expects to recognize approximately $2.8 million of deferred revenue over the next twelve months and the remaining $0.1 million beyond that time period.

The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

The Company operates in multiple taxing jurisdictions, both within and outside of the United States. For the nine months ended April 30, 2024, the Company was profitable in certain jurisdictions, resulting in an income tax expense using enacted rates in those jurisdictions. As of both April 30, 2024 and July 31, 2023, the total amount of the liability for unrecognized tax benefits related to federal, state and foreign taxes was approximately $0.4 million.

Deferred Income Taxes

As of April 30, 2024, the Company reassessed the need for a valuation allowance against its deferred tax assets. After considering historical and projected future taxable income and existing taxable temporary differences, the Company determined that it is more likely than not that the deferred tax assets will be realized. As a result, the Company released substantially all of its valuation allowance except the valuation allowance relating to approximately $31.0 million of NOLs that will expire as of July 31, 2024, and approximately $0.9 million of state NOLs that the Company anticipates will expire unutilized. This release of the valuation allowance resulted in a one-time non-cash income tax benefit of $71.5 million for the quarter ended April 30, 2024.

Uncertain Tax Positions

In accordance with the Company's accounting policy, interest related to unrecognized tax benefits is included in the income tax expense line of the condensed consolidated statements of operations. As of both April 30, 2024 and July 31, 2023, the liabilities for interest expense related to uncertain tax positions was less than $0.1 million. The Company expects $0.3 million of unrecognized tax benefits and related interest to reverse in the next twelve months.

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Management's judgment is required in determining our provision for income taxes, including any valuation allowance recorded against the Company’s deferred tax assets due to uncertainties related to our ability to utilize these assets. The valuation allowance is based on our estimates of taxable income and the period over which the Company’s deferred tax assets will be recoverable. The evolution of facts and circumstances in future periods may result in adjustments to our valuation allowance, which could materially impact our financial position and results of operation.

The Company is subject to U.S. federal income tax and various state, local and international income taxes in numerous jurisdictions. The federal and state tax returns are generally subject to tax examinations for the tax years ended July 31, 2020 through July 31, 2023. To the extent the Company has tax attribute carryforwards, the tax year in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state tax authorities to the extent utilized in a future period. In addition, a number of tax years remain subject to examination by the appropriate government agencies for certain countries in the Europe and Asia regions. In Europe, the Company's 2015 through 2022 tax years remain subject to examination in most locations, while the Company's 2010 through 2021 tax years remain subject to examination in most Asia locations.

As discussed in Note 2 - "Basis of Presentation", the Reverse/Forward Stock Split was effective on June 21, 2023. The Company’s shares of outstanding common stock and earnings per share amounts have been retroactively restated for all periods

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presented for the Reverse/Forward Stock Split. The following table reconciles net earnings per share for the three and nine months ended April 30, 2024 and 2023:

			Successor												Predecessor						Successor												Predecessor
			Three Months Ended April 30,												Three Months Ended April 30,						Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023						2024												2023
			(in thousands, except per share data)
Reconciliation of net income to net income attributable to common stockholders after assumed conversions:
Net income			$	71,660											$	3,029					$	81,442											$	7,460
Less: Preferred dividends on Series C redeemable preferred stock			(531)												(519)						(1,604)												(1,593)
Net income available to common stockholders			71,129												2,510						79,838												5,867
Less: Undistributed earnings allocated to participating securities			(54,125)												—						(60,780)												—
Net income attributable to common stockholders			$	17,004											$	2,510					$	19,058											$	5,867
Effect of dilutive securities:
Interest and debt amortization costs on convertible debt			243												—						739												—
Dividends on Series C preferred stock			531												519						1,604												1,593
Undistributed earnings allocated to Series E preferred stock			54,125												—						60,780												—
Net income attributable to common stockholders - assuming dilution			$	71,903											$	3,029					$	82,181											$	7,460
Net income per common share - basic			$	2.73											$	0.39					$	3.07											$	0.91
Net income per common share - diluted			$	2.51											$	0.36					$	2.88											$	0.89
Weighted average common shares outstanding - basic			6,224												6,461						6,211												6,449
Effect of dilutive securities:
Common stock equivalents - Restricted stock and restricted stock shares			68												57						62												55
Common stock equivalents - Convertible debt			584												—						584												—
Common stock equivalents - Series C Preferred stock			1,913												1,913						1,913												1,913
Common stock equivalents - Series E Preferred stock			19,810												—						19,810												—
Weighted average common shares outstanding - diluted			28,599												8,431						28,580												8,417

For the three and nine months ended April 30, 2024, the Company calculated basic and diluted net income per common share using the two-class method, as the Series E Convertible Preferred Stock meets the definition of a participating security. The two-class method is an allocation formula that determines net income per common share for each share of common stock and Series E Convertible Preferred Stock, a participating security, according to dividends declared and participation rights in undistributed earnings. Under this method, all earnings (distributed and undistributed) are allocated to common shares and Series E Convertible Preferred Stock based on their respective rights to receive dividends. The holders of Series E Convertible Preferred Stock are entitled to participate equally and ratably with the holders of shares of Common Stock in all dividends or other distributions on the shares of Common Stock as if, immediately prior to each record date for payment of dividends or other distributions on the Common Stock, shares of Series E Preferred Stock then outstanding were converted into shares of Common Stock. Basic net income per common share is computed by dividing net income attributable to common stockholders for the period by the weighted average number of common shares outstanding for the period. Net income attributable to common stockholders for the period includes any dividends paid to common stockholders during the period plus a proportionate share of undistributed net income allocable to common stockholders for the period; the proportionate share of undistributed net income allocable to common stockholders for the period is based on the proportionate share of total weighted-average common shares and participating securities outstanding during the period. Diluted net income per common share is computed based on the weighted

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average number of shares of common stock outstanding during each period, plus potential common shares considered outstanding during the period, as long as the inclusion of such awards is not antidilutive. Potential common shares consist of restricted common stock (calculated based on the treasury stock method) and shares issuable upon debt or preferred stock conversion (calculated using an as-if converted method), using the more dilutive of either the two-class method or as-converted stock method.

The Company was not required to apply the two-class method during the Predecessor Period as there were no participating securities, and as such, there were no changes to the Predecessor Period other than the retrospective restatement for the Reverse/Forward Stock Split discussed previously.

The below details certain exclusions from the calculation of diluted net income per share, as their inclusion would have been antidilutive:

For the three months ended April 30, 2023, $0.7 million of interest expense, net of tax related to the SPHG Note was excluded from the numerator in the calculation of diluted net income per share as its inclusion would have been antidilutive. For the three months ended April 30, 2023, 0.6 million common stock equivalent shares (including those related to the SPHG Note) were excluded from the denominator in the calculation of diluted net income per share as their inclusion would have been antidilutive.

For the nine months ended April 30, 2023, $2.3 million of interest expense, net of tax impact related to the SPHG Note was excluded from the numerator in the calculation of diluted net income per share as its inclusion would have been antidilutive. For the nine months ended April 30, 2023, 0.6 million common stock equivalent shares (including those related to the SPHG Note) were excluded from the denominator in the calculation of diluted net income per share as their inclusion would have been antidilutive.

No exclusions were required from the calculation of diluted net income per share for the three and nine months ended April 30, 2024, as all securities were considered dilutive.

Comprehensive (loss) income combines net income and other comprehensive items. Other comprehensive items represent certain amounts that are reported as components of stockholders' equity in the accompanying condensed consolidated balance sheets. Accumulated other comprehensive items consist of the following:

			Foreign Currency Items						Pension Items												Total
			(in thousands)
Accumulated other comprehensive (loss) income as of July 31, 2023 (Successor)			$	(623)					$	36											$	(587)
Foreign currency translation adjustment			(341)						—												(341)
Net current-period other comprehensive loss			(341)						—												(341)
Accumulated other comprehensive (loss) income as of April 30, 2024 (Successor)			$	(964)					$	36											$	(928)

			Foreign Currency Items						Pension Items												Total
			(in thousands)
Accumulated other comprehensive income (loss) as of July 31, 2022 (Predecessor)			$	6,063					$	(1,923)											$	4,140
Foreign currency translation adjustment			999						—												999
Pension liability adjustments, net of tax			—						(1,078)												(1,078)
Net current-period other comprehensive income (loss)			999						(1,078)												(79)
Accumulated other comprehensive income (loss) as of April 30, 2023 (Predecessor)			$	7,062					$	(3,001)											$	4,061

During the year ended July 31, 2020, a Netherlands defined benefit pension plan was amended, so that active participants no longer accrued benefits as of January 1, 2020, which resulted in a pre-tax curtailment gain of $2.4 million recognized in accumulated other comprehensive income (loss). At that time, the active plan participants were moved into a new defined benefit contribution pension plan. During the nine months ended April 30, 2023, the Company recorded an increase of approximately $1.1 million to accrued pension liabilities for the defined benefit pension plan as it was determined plan participants are entitled to unconditional indexation of benefits for as long as they remain in active service with the Company.

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The Company has one reportable segment: Supply Chain. The Company also has Corporate-level activity, which consists primarily of costs associated with certain corporate administrative functions such as legal, finance and share-based compensation, which are not allocated to the Company's reportable segment. The Corporate-level balance sheet information includes cash and cash equivalents, debt and other assets and liabilities which are not allocated to the operations of the Company's operating segment. All significant intra-segment amounts have been eliminated. Management evaluates segment performance based on segment net revenue and operating income (loss).

Summarized financial information of the Company's continuing operations by operating segment is as follows:

			Successor												Predecessor						Successor												Predecessor
			Three Months Ended April 30,												Three Months Ended April 30,						Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023						2024												2023
			(in thousands)
Net revenue:
Supply Chain			$	43,855											$	46,142					$	128,240											$	148,283
Total segment net revenue			$	43,855											$	46,142					$	128,240											$	148,283
Operating income:
Supply Chain			$	4,448											$	5,249					$	10,187											$	16,488
Total segment operating income			4,448												5,249						10,187												16,488
Corporate-level activity			(1,468)												(4,944)						(3,680)												(9,699)
Total operating income			2,980												305						6,507												6,789
Total other income, net			880												3,575						8,000												2,301
Income before income taxes			$	3,860											$	3,880					$	14,507											$	9,090

			Successor
			April 30, 2024						July 31, 2023
			(in thousands)
Total assets:
Supply Chain			$	160,565					$	146,614
Corporate			324,897						264,567
Total assets			$	485,462					$	411,181

Summarized financial information of the Company's capital expenditures and depreciation expense for the Supply Chain reportable segment is as follows:

			Successor												Predecessor						Successor												Predecessor
			Three Months Ended April 30,												Three Months Ended April 30,						Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023						2024												2023
			(in thousands)
Capital expenditures			$	1,211											$	445					$	2,911											$	1,311
Depreciation expense			$	439											$	503					$	1,324											$	1,427

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Summarized financial information of the Company's net revenue by geographic location is as follows:

			Successor												Predecessor						Successor												Predecessor
			Three Months Ended April 30,												Three Months Ended April 30,						Nine Months Ended April 30,												Nine Months Ended April 30,
			2024												2023						2024												2023
			(in thousands)
Mainland China			$	15,822											$	13,852					$	45,577											$	48,049
United States			9,776												12,917						31,593												38,262
Netherlands			5,035												4,872						16,121												15,149
Singapore			4,413												4,705						12,332												14,940
Czech Republic			4,241												6,202						9,436												19,497
Other			4,568												3,594						13,181												12,386
Total consolidated net revenue			$	43,855											$	46,142					$	128,240											$	148,283

As of April 30, 2024, SPHG Holdings and its affiliates, including Steel Holdings, Handy & Harman Ltd. and Steel Partners Ltd., beneficially owned approximately 89.6% of our outstanding capital stock, including the if-converted value of the SPHG Note and shares of Series C Convertible Preferred Stock and Series E Convertible Preferred Stock that vote on an as-converted basis together with our common stock. Warren G. Lichtenstein, our Interim Chief Executive Officer and the Executive Chairman of our Board, is also the Executive Chairman of Steel Holdings GP. Glen Kassan, our Vice Chairman of the Board of Directors and former Chief Administrative Officer, is an employee of Steel Services. Jack L. Howard, the President and a director of Steel Holdings GP, is also a director. Joseph Martin, one of our directors, is the Chief Administrative Officer and Chief Legal Officer of Steel Holdings. Ryan O'Herrin, our Chief Financial Officer, is the Chief Financial Officer of Steel Holdings.

Upon closing of the Exchange Transaction on May 1, 2023, the Company became a consolidated subsidiary of Steel Holdings as described in Note 1 - "Nature of Operations", Note 2 - "Basis of Presentation", and Note 4 - "Exchange Transaction". After May 1, 2023, transactions between Steel Holdings and the Company are eliminated in consolidation by Steel Holdings.

SPHG Note Transaction

On February 28, 2019, the Company entered into the SPHG Note Purchase Agreement with SPHG Holdings, whereby SPHG Holdings agreed to loan the Company $14.9 million in exchange for the SPHG Note.

On March 9, 2023 (the "Amendment Date"), the Company and SPHG Holdings entered into an amendment to the SPHG Note. Pursuant to the SPHG Note Amendment, the maturity date of the SPHG Note was extended six months from March 1, 2024 to September 1, 2024. The Company repaid $1.0 million in principal amount of the SPHG Note on the Amendment Date, and repaid an additional $1.0 million principal amount of the note on June 9, 2023. In connection with the SPHG Note Amendment, the Company also paid SPHG Holdings a cash amendment fee of $0.1 million, and derecognized $0.2 million of the debt discount in proportion to the reduction of the principal balance on the Amendment Date in the third quarter of Fiscal Year 2023. No other changes were made to the terms of the SPHG Note besides the items discussed.

SPHG Holdings has the right, at its option, prior to the close of business on the business day immediately preceding the maturity date of the SPHG Note, to convert the SPHG Note or a portion thereof that is $1,000 or an integral multiple thereof, into shares of common stock (if the Company has not received a required stockholder approval) or cash, shares of common stock or a combination of cash and shares of common stock, as applicable (if the Company has received a required stockholder approval), at an initial conversion rate of 45.1356 shares of common stock, which is equivalent to an initial conversion price of approximately $22.16 per share (subject to adjustment as provided in the SPHG Note) per $1,000 principal amount of the SPHG Note, subject to, and in accordance with, the settlement provisions of the SPHG Note. As of April 30, 2024, the if-converted value of the SPHG Note did not exceed the principal value of the SPHG Note. Refer to Note 10 - "Debt" for further information.

Series C Preferred Stock Transaction

On December 15, 2017, the Company entered into a Preferred Stock Purchase Agreement with SPHG Holdings, pursuant to which the Company issued 35,000 shares of the Company's newly created Series C Convertible Preferred Stock to SPHG Holdings at a price of $1,000 per share, for an aggregate purchase consideration of $35.0 million. The terms, rights, obligations and preferences of the Series C Convertible Preferred Stock are set forth in the Series C Certificate of Designations, which has

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been filed with the Secretary of State of the State of Delaware. During each of the three months ended April 30, 2024 and 2023, the Company paid dividends of $0.5 million associated with the Series C Convertible Preferred Stock. During each of the nine months ended April 30, 2024 and 2023, the Company paid dividends of $1.6 million associated with the Series C Convertible Preferred Stock.

On or after December 15, 2022, each holder of Series C Convertible Preferred Stock can also require the Company to redeem its Series C Convertible Preferred Stock in cash at a price equal to the Liquidation Preference (as defined in Series C Certificate of Designations).

Series E Preferred Stock Transaction

On May 1, 2023, the Company and Steel Holdings executed a series of agreements in which the Steel Partners Group agreed to transfer certain marketable securities held by the Steel Partners Group to Steel Connect in exchange for 3.5 million shares of Series E Convertible Preferred Stock of Steel Connect (the “Series E Convertible Preferred Stock”, and, such transfer, the “Transfer and Exchange Agreement”). Pursuant to the Transfer and Exchange Agreement, the Company held a special stockholders’ meeting on June 6, 2023 (the “Special Meeting”) to consider and vote upon the rights of the Series E Preferred Stock to vote and receive dividends together with the Common Stock on an as-converted basis and the issuance of the Company's common stock (the "Common Stock") upon conversion of the Series E Preferred Stock by the holders at their option, pursuant to the rules and regulations of Nasdaq (the “Nasdaq Proposal”). Following approval of the Nasdaq Proposal by the Steel Connect stockholders (the “Stockholder Approval”), the Series E Convertible Preferred Stock became convertible into an aggregate of 19.8 million shares of Common Stock, and votes together with holders of Company Common Stock and participates in any dividends paid on the Common Stock, in each case on an as-converted basis.

The terms, rights, obligations and preferences of the Series E Convertible Preferred Stock are set forth in a Certificate of Designations, Preferences and Rights of Series E Convertible Preferred Stock of the Company (the “Series E Certificate of Designations”).

Stockholders' Agreement

Concurrently with the execution of the Transfer and Exchange Agreement, the Company, Steel Holdings, Steel Excel, WebFinancial, WHX CS, LLC, WF Asset Corp., Steel Partners Ltd., Warren G. Lichtenstein and Jack L. Howard (together, the "SP Investors") entered into a Stockholders' Agreement dated as of April 30, 2023 (the "Stockholders' Agreement"). Pursuant to the Stockholders' Agreement, the parties agreed to certain aspects of the Company's governance, including the maintenance of the Board size at seven directors and the creation of an audit committee consisting of at least three independent directors under SEC and applicable stock exchange rules (an "Independent Audit Committee") or one consisting of at least three directors, at least one of whom qualifies as independent under SEC and applicable stock exchange rules and the remainder of whom are not affiliated, as described in the Stockholders’ Agreement, with the Company or the SP Investors or their subsidiaries or affiliates (the “Disinterested Audit Committee”).

The Stockholders' Agreement further provides that (a) prior to September 1, 2025 the prior approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable, is required for the following: (i) a voluntary delisting of the common stock from the applicable stock exchange or a transaction (including a merger, recapitalization, stock split or otherwise) which results in the delisting of the common stock, Steel Connect ceasing to be an SEC reporting company, or Steel Connect filing a Form 25 or Form 15 or any similar form with the SEC; (ii) an amendment to the terms of the STCN Management Services Agreement (the "Services Agreement") dated June 14, 2019, by and between Steel Connect and Steel Services Ltd.; and (iii) any related party transaction between Steel Connect and the SP Investors and their subsidiaries and affiliates; (b) prior to September 1, 2028, the prior approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable, is required for the Board to approve a going private transaction pursuant to which Steel Holdings or its subsidiaries or affiliates acquires the outstanding shares of common stock they do not own (or any alternative transaction that would have the same impact); and (c) until the Final Sunset Date (as defined in the Stockholders' Agreement), the prior approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable, is required (i) for the Board to approve a short-form or squeeze-out merger between Steel Connect and the SP Investors; or (ii) prior to any transfer of equity interests in Steel Connect by the members of the SP Group (as defined in the Stockholders' Agreement) if such transfers would result in 80% of the voting power and value of the equity interests in Steel Connect that are held by the members of the SP Group being held by one corporate entity.

Currently, the Stockholders' Agreement also provides that 70% of the net proceeds received by the Company upon resolution of the Reith litigation will be distributed to the Company’s stockholders with the SP Investors agreeing to waive their portion of any such distribution to the extent of any shares of common stock held as of the date of the Stockholders’ Agreement or issuable upon conversion of the Series E Convertible Preferred Stock held by the SP Investors and the Series C Convertible Preferred Stock of Steel Connect, and the SPHG Note. Any amendment to the Stockholders’ Agreement by the Company prior to the date that any person or group of related persons owns 100% of the equity securities of the Company requires the prior

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approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable. As described in the notes to the financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, if the 2024 Settlement is approved, the Company will make certain changes to the Stockholders’ Agreement as described above.

Steel Connect Management Services Agreement

On June 14, 2019, the Company entered into an agreement (the "STCN Management Services Agreement") with Steel Services Ltd. ("Steel Services"), an indirect wholly-owned subsidiary of Steel Holdings. The STCN Management Services Agreement was effective as of June 1, 2019. Pursuant to the STCN Management Services Agreement, Steel Services provides the Company and its subsidiaries with the non-exclusive services of certain employees, including certain executive officers (including chief financial officer and general counsel services) and other corporate services. The STCN Management Services Agreement also provides for reimbursements to Steel Services and its representatives for all reasonable expenses incurred in providing the non-exclusive services and automatically renews for successive one year periods unless and until terminated by the Company or Steel Services. On February 25, 2022, in connection with the Company's disposal of its ownership in IWCO Direct Holdings, Inc., the management fee was reduced from $282.8 thousand per month to $101.9 thousand per month.

On October 25, 2023, the Company and Steel Services entered into Amendment No. 2 to the STCN Management Services Agreement, pursuant to which the parties agreed to increase the monthly fee to $131.0 thousand effective as of January 1, 2024, primarily to increase the business development and mergers and acquisition staffing needed to originate, analyze and pursue strategic acquisitions and investments.

Prior to the effective date of Amendment No. 2 to the STCN Management Services Agreement, expenses incurred by ModusLink were paid to Steel Services under the STCN Management Services Agreement.

ModusLink Management Services Agreement

On October 25, 2023, ModusLink entered into a management services agreement (the “ModusLink Management Services Agreement”) with Steel Services, effective as of January 1, 2024. Pursuant to the ModusLink Management Services Agreement, Steel Services will provide ModusLink with certain non-exclusive services of certain employees and executive officers to serve in various positions or functions and to perform duties normally associated with those specific to, or substantially equivalent, positions or functions for ModusLink based on its particular needs. Such services include, but are not limited to, services related to legal and environmental, health and safety, finance, tax and treasury, human resources, “lean,” internal audit, mergers and acquisitions, and information technology. Previously, the terms regarding such non-exclusive services were governed by the STCN Management Services Agreement.

The ModusLink Management Services Agreement provides that ModusLink will pay Steel Services a fixed monthly fee of $80.0 thousand in consideration of the non-exclusive services and will reimburse Steel Services and its representatives for all reasonable expenses incurred in providing the services. The ModusLink Management Services Agreement will automatically renew for successive one-year periods unless and until terminated by ModusLink or Steel Services.

Total expenses incurred related to the management services agreements for the three months ended April 30, 2024 and 2023 were $0.9 million and $0.6 million, respectively. Total expenses incurred related to the management services agreements for the nine months ended April 30, 2024 and 2023 were $2.2 million and $1.7 million, respectively. As of April 30, 2024 and July 31, 2023, amounts due to Steel Services were $0.6 million and $0.7 million, respectively, and are recorded within the condensed consolidated balance sheets as a component of Accounts payable.

Air Travel

The Company reimburses SP General Services, LLC (an affiliate of Steel Holdings), rather than Steel Services, for expenses for business-related air travel, which relates to services provided to the Company by Warren G. Lichtenstein as Interim Chief Executive Officer as well as certain of the Company’s executive officers whose services are provided to the Company under the STCN Management Services Agreement or the ModusLink Management Services Agreement. During the three and nine months ended April 30, 2024, SP General Services, LLC incurred $0.4 million and $0.5 million in expenses for business-related air travel. During the three and nine months ended April 30, 2023, SP General Services, LLC did not incur any reportable expenses for such business-related air travel. As of April 30, 2024, amounts due to SP General Services, LLC were $0.5 million. There was no balance due to SP General Services, LLC as of July 31, 2023.

Assets and Liabilities that are Measured at Fair Value on a Recurring Basis

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The following tables present the Company's financial assets and liabilities measured at fair value on a recurring basis as of April 30, 2024 and July 31, 2023, classified by fair value hierarchy:

			Successor						Fair Value Measurements at Reporting Date Using
(in thousands)			April 30, 2024						Level 1						Level 2						Level 3
Assets:
Money market funds			$	254,118					$	254,118					$	—					$	—
Convertible loan note investment			$	—					$	—					$	—					$	—
Other investments			$	14,293					$	14,293					$	—					$	—
Liabilities:
SPHG Note			$	12,903					$	—					$	—					$	12,903

			Successor						Fair Value Measurements at Reporting Date Using
(in thousands)			July 31, 2023						Level 1						Level 2						Level 3
Assets:
Money market funds			$	85,269					$	85,269					$	—					$	—
Liabilities:
SPHG Note			$	12,461					$	—					$	—					$	12,461

There were no transfers between Levels 1, 2 or 3 during any of the periods presented.

ASC 820, Fair Value Measurement, provides that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820 requires the Company to use valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows:

Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets

Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs

Level 3: Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants would price the assets or liabilities

When available, quoted prices are used to determine fair value. When quoted prices in active markets are available, investments are classified within Level 1 of the fair value hierarchy. When quoted prices in active markets are not available, fair values are determined using pricing models, and the inputs to those pricing models are based on observable market inputs. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others.

Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis

The Company reviews the carrying amounts of these assets whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. An impairment loss is recognized when the carrying amount of the asset group or reporting unit is not recoverable and exceeds its fair value. The Company estimates the fair values of assets subject to impairment based on the Company's own judgments about the assumptions that market participants would use in pricing the assets and on observable market data, when available.

Fair Value of Financial Instruments

The Company's financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, customer deposits, accounts payable, and restricted cash, and are reflected in the consolidated financial

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statements at carrying value. Carrying value approximates fair value for these items due to their short-term nature. Included in cash and cash equivalents in the accompanying condensed consolidated balance sheets are money market funds. These are valued at quoted market prices in active markets.

Subsequent to the issuance of Fiscal Year 2023 financial statements, the Company determined that the money market funds balance as of July 31, 2023 in the above table, was understated by $54.2 million. The Company corrected this immaterial error in the table above as of July 31, 2023. This disclosure change did not have any impact to amounts recognized in the condensed consolidated balance sheets.

Following is a summary of changes in financial assets and liabilities measured using Level 3 inputs:

(in thousands)						SPHG Note (a)						Convertible Loan Note Investment (a)
Balance as of July 31, 2023 (Successor)						$	12,461					$	—
Purchases						—						1,227
Change in fair value						442						(1,227)
Balance as of April 30, 2024 (Successor)						$	12,903					$	—

(a) Unrealized losses are recorded in Other (losses) gains, net within the condensed consolidated statements of operations.

Valuation Techniques

Prior to the date of the Exchange Transaction, the Company did not measure the fair value of the SPHG Note on a recurring basis, as the assumption was that the carrying value of the liability component of the SPHG Note approximated fair value because the stated interest rate of this debt was consistent with current market rates. In conjunction with the application of pushdown accounting, the Company now measures the fair value of the SPHG Note on a recurring basis. Refer to Note 10 - "Debt" for further details. The Company estimates the value of the SPHG Note using a Binomial Lattice Model. Key inputs in the valuation include the trading price and volatility of Steel Connect's common stock, the risk-free rate of return, as well as the dividend rate, conversion price, and maturity date. The Company recognized $0.4 million in unrealized losses in Other (losses) gains, net within the condensed consolidated statements of operations for the nine months ended April 30, 2024 as a result of the fair value measurement performed. The Company determined that there have been no changes to the fair value of the SPHG Note from the prior quarter, given that the fair value remeasurement performed as of January 31, 2024 yielded $12.9 million, which equates to the principal balance remaining on the SPHG Note, and the SPHG Note is due on September 1, 2024.

As discussed in Note 7 - "Investments", the Company elected the fair value option to account for their convertible loan note investment. As of April 30, 2024, the Company believes the fair value of the investment is zero. As such, the Company recorded a loss of $1.2 million to the condensed consolidated statement of operations for the three and nine months ended April 30, 2024. There were no unrealized gains or losses recorded to the condensed consolidated statement of operations for the Predecessor Period, as the convertible loan note investment was a new investment in October 2023.

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A summary of supplemental cash flow information for the nine months ended April 30, 2024 and 2023 is presented in the following table:

						Successor												Predecessor
						Nine Months Ended April 30,												Nine Months Ended April 30,
						2024												2023
						(in thousands)
Cash paid during the period for:
Interest						$	1,009											$	1,145
Income taxes						$	215											$	35

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v3.24.1.1.u2

Cover Page - shares	9 Months Ended
	Apr. 30, 2024	May 30, 2024
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Apr. 30, 2024
Document Transition Report	false
Entity File Number	001-35319
Entity Registrant Name	Steel Connect, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	04-2921333
Entity Address, Address Line One	590 Madison Avenue
Entity Address, City or Town	New York
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10022
City Area Code	914
Local Phone Number	461-1276
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		6,304,750
Amendment Flag	false
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q3
Entity Central Index Key	0000914712
Current Fiscal Year End Date	--07-31
Common Stock
Entity Information [Line Items]
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	STCN
Security Exchange Name	NASDAQ
Series D Preferred Stock
Entity Information [Line Items]
Title of 12(b) Security	Rights to Purchase Series D Junior Participating Preferred Stock
Security Exchange Name	NASDAQ
No Trading Symbol	true

v3.24.1.1.u2

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Apr. 30, 2024	Jul. 31, 2023
Current Assets
Cash and cash equivalents	$ 269,237,000	$ 121,372,000
Accounts receivable, trade, net of allowance for credit losses of $169 and $219 at April 30, 2024 and July 31, 2023, respectively	31,873,000	28,616,000
Inventories, net	7,474,000	8,569,000
Funds held for clients	3,139,000	2,031,000
Prepaid expenses and other current assets	2,727,000	158,686,000
Total current assets	314,450,000	319,274,000
Property and equipment, net	5,153,000	3,698,000
Operating lease right-of-use assets	22,907,000	27,098,000
Investments	14,293,000	0
Other intangible assets, net	31,929,000	34,589,000
Goodwill	22,785,000	22,785,000
Deferred tax assets	71,065,000	317,000
Other assets	2,880,000	3,420,000
Total assets	485,462,000	411,181,000
Current Liabilities
Accounts payable	27,494,000	26,514,000
Accrued expenses	23,057,000	26,774,000
Funds held for clients	3,031,000	1,949,000
Current lease obligations	8,890,000	7,973,000
Convertible note payable	12,903,000	0
Other current liabilities	4,333,000	4,544,000
Total current liabilities	79,708,000	67,754,000
Convertible note payable	0	12,461,000
Long-term lease obligations	14,444,000	19,161,000
Other long-term liabilities	4,997,000	5,442,000
Total long-term liabilities	19,441,000	37,064,000
Total liabilities	99,149,000	104,818,000
Contingently redeemable preferred stock	237,733,000	237,739,000
Stockholders' equity:
Preferred stock, $0.01 par value per share. 4,965,000 shares authorized at April 30, 2024 and July 31, 2023; zero shares issued and outstanding at April 30, 2024 and July 31, 2023	0	0
Common stock, $0.01 par value per share. Authorized 1,400,000,000 shares; 6,304,750 issued and outstanding shares at April 30, 2024; 6,250,493 issued and outstanding shares at July 31, 2023	65,000	65,000
Additional paid-in capital	61,993,000	61,534,000
Accumulated earnings	87,450,000	7,612,000
Accumulated other comprehensive loss	(928,000)	(587,000)
Total stockholders' equity	148,580,000	68,624,000
Total liabilities, contingently redeemable preferred stock and stockholders' equity	485,462,000	411,181,000
Series C Contingently Redeemable Preferred Stock
Current Liabilities
Contingently redeemable preferred stock	35,000,000	35,006,000
Series E Contingently Redeemable Preferred Stock
Current Liabilities
Contingently redeemable preferred stock	$ 202,733,000	$ 202,733,000

v3.24.1.1.u2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023
Accounts receivable, trade, allowance for doubtful accounts	$ 169	$ 219
Preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	4,965,000	4,965,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in usd per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	1,400,000,000	1,400,000,000
Common stock, shares issued (in shares)	6,304,750	6,250,493
Common stock, shares outstanding (in shares)	6,304,750	6,250,493
Series C Contingently Redeemable Preferred Stock
Preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	35,000	35,000
Preferred stock, shares issued (in shares)	35,000	35,000
Preferred stock, shares outstanding (in shares)	35,000	35,000
Series E Contingently Redeemable Preferred Stock
Preferred stock, par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	3,500,000	3,500,000
Preferred stock, shares issued (in shares)	3,500,000	3,500,000
Preferred stock, shares outstanding (in shares)	3,500,000	3,500,000

v3.24.1.1.u2

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Income Statement [Abstract]
Net revenue	$ 43,855	$ 46,142	$ 128,240	$ 148,283
Cost of revenue	30,838	33,218	92,402	108,031
Gross profit	13,017	12,924	35,838	40,252
Operating expenses:
Selling, general and administrative	9,144	12,619	26,670	33,463
Amortization	893	0	2,661	0
Total operating expenses	10,037	12,619	29,331	33,463
Operating income	2,980	305	6,507	6,789
Other income (expense):
Interest income	3,656	452	10,374	928
Interest expense	(243)	(914)	(739)	(2,588)
Other (losses) gains, net	(2,533)	4,037	(1,635)	3,961
Total other income, net	880	3,575	8,000	2,301
Income before income taxes	3,860	3,880	14,507	9,090
Income tax (benefit) expense	(67,800)	851	(66,935)	1,630
Net income	71,660	3,029	81,442	7,460
Less: Preferred dividends on Series C redeemable preferred stock	(531)	(519)	(1,604)	(1,593)
Net income available to common stockholders	$ 71,129	$ 2,510	$ 79,838	$ 5,867
Net income per common shares - basic (in usd per share)	$ 2.73	$ 0.39	$ 3.07	$ 0.91
Net income per common shares - diluted (in usd per share)	$ 2.51	$ 0.36	$ 2.88	$ 0.89
Weighted Average Number of Shares Outstanding, Diluted [Abstract]
Weighted-average number of common shares outstanding - basic (in shares)	6,224	6,461	6,211	6,449
Weighted-average number of common shares outstanding - basic (in shares)	28,599	8,431	28,580	8,417

v3.24.1.1.u2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Statement of Comprehensive Income [Abstract]
Net income	$ 71,660	$ 3,029	$ 81,442	$ 7,460
Other comprehensive income (loss):
Foreign currency translation adjustment	(68)	(819)	(341)	999
Pension liability adjustments	0	0	0	(1,078)
Other comprehensive loss	(68)	(819)	(341)	(79)
Comprehensive income	$ 71,592	$ 2,210	$ 81,101	$ 7,381

v3.24.1.1.u2

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Earnings	Accumulated Other Comprehensive Income (Loss)
Beginning balance (in shares) at Jul. 31, 2022		6,485,309
Beginning balance at Jul. 31, 2022	$ (9,206)	$ 65	$ 7,479,906	$ (7,493,317)	$ 4,140
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	7,460			7,460
Preferred dividends	(1,593)			(1,593)
Restricted stock grants (in shares)		44,240
Share-based compensation	529		529
Other comprehensive items	(79)				(79)
Ending balance (in shares) at Apr. 30, 2023		6,529,549
Ending balance at Apr. 30, 2023	(2,889)	$ 65	7,480,435	(7,487,450)	4,061
Beginning balance (in shares) at Jan. 31, 2023		6,512,633
Beginning balance at Jan. 31, 2023	(4,754)	$ 65	7,480,261	(7,489,960)	4,880
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	3,029			3,029
Preferred dividends	(519)			(519)
Restricted stock grants (in shares)		16,916
Share-based compensation	174		174
Other comprehensive items	(819)				(819)
Ending balance (in shares) at Apr. 30, 2023		6,529,549
Ending balance at Apr. 30, 2023	$ (2,889)	$ 65	7,480,435	(7,487,450)	4,061
Beginning balance (in shares) at Jul. 31, 2023	6,250,493	6,250,493
Beginning balance at Jul. 31, 2023	$ 68,624	$ 65	61,534	7,612	(587)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	81,442			81,442
Preferred dividends	(1,604)			(1,604)
Restricted stock grants (in shares)		54,257
Share-based compensation	459		459
Other comprehensive items	$ (341)				(341)
Ending balance (in shares) at Apr. 30, 2024	6,304,750	6,304,750
Ending balance at Apr. 30, 2024	$ 148,580	$ 65	61,993	87,450	(928)
Beginning balance (in shares) at Jan. 31, 2024		6,285,591
Beginning balance at Jan. 31, 2024	77,357	$ 65	61,831	16,321	(860)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	71,660			71,660
Preferred dividends	(531)			(531)
Restricted stock grants (in shares)		19,159
Share-based compensation	162		162
Other comprehensive items	$ (68)				(68)
Ending balance (in shares) at Apr. 30, 2024	6,304,750	6,304,750
Ending balance at Apr. 30, 2024	$ 148,580	$ 65	$ 61,993	$ 87,450	$ (928)

v3.24.1.1.u2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023
Cash flows from operating activities:
Net income	$ 81,442	$ 7,460
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation	1,324	1,427
Amortization of finite-lived intangible assets	2,661	0
Amortization of deferred financing costs	0	36
Accretion of debt discount	0	1,688
Share-based compensation	459	529
Deferred taxes	(71,550)	0
Non-cash lease expense	6,838	6,760
Bad debt expense	0	1,136
Other losses (gains), net	1,635	(3,962)
Changes in operating assets and liabilities:
Accounts receivable, net	(3,632)	2,933
Inventories, net	808	1,440
Prepaid expenses and other current assets	1,363	(1,237)
Accounts payable and accrued expenses	(1,725)	(3,886)
Refundable and accrued income taxes, net	(117)	(829)
Other assets and liabilities	(4,078)	(4,495)
Net cash provided by operating activities	15,428	9,000
Cash flows from investing activities:
Purchases of investments	(18,869)	0
Proceeds from sales of investments	157,599	1,881
Additions of property and equipment	(2,911)	(1,311)
Proceeds from the disposition of property and equipment	0	166
Net cash provided by investing activities	135,819	736
Cash flows from financing activities:
Preferred dividend payments	(1,604)	(1,593)
Payment of deferred financing costs	0	(149)
Repayments on debt	0	(1,000)
Repayments on capital lease obligations	0	(38)
Net cash used in financing activities	(1,604)	(2,780)
Net effect of exchange rate changes on cash, cash equivalents and restricted cash	(670)	895
Net increase in cash, cash equivalents and restricted cash	148,973	7,851
Cash, cash equivalents and restricted cash, beginning of period	123,403	58,045
Cash, cash equivalents and restricted cash, end of period	272,376	65,896
Cash and cash equivalents, end of period	269,237	62,738
Restricted cash for funds held for clients, end of period	3,139	3,158
Cash, cash equivalents and restricted cash, end of period	$ 272,376	$ 65,896

v3.24.1.1.u2

NATURE OF OPERATIONS	9 Months Ended
	Apr. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
NATURE OF OPERATIONS	NATURE OF OPERATIONS Steel Connect, Inc. (the "Company" or "Steel Connect"), is a holding company which operates through its wholly-owned subsidiary ModusLink Corporation ("ModusLink" or "Supply Chain"). ModusLink is a supply chain business process management company serving clients in markets such as consumer electronics, communications, computing, medical devices, software and retail. ModusLink designs and executes elements in its clients' global supply chains to improve speed to market, product customization, flexibility, cost, quality and service. The Company also produces and licenses an entitlement management solution for activation, provisioning, entitlement subscription and data collection from physical goods (connected products) and digital products. Steel Partners and Steel Connect Exchange Transaction On April 30, 2023, Steel Partners Holdings L.P., (“Steel Holdings”) and the Company executed a series of agreements in which Steel Holdings and certain of its affiliates (the “Steel Partners Group”) agreed to transfer certain marketable securities held by the Steel Partners Group to the Company in exchange for 3.5 million shares of Series E Convertible Preferred Stock of the Company (the “Series E Convertible Preferred Stock”, and, such transfer and related transactions, the “Exchange Transaction”). The Exchange Transaction closed on May 1, 2023, which is the date that the consideration was exchanged between Steel Holdings and the Company. See Note 4 - "Exchange Transaction" for further information regarding the Exchange Transaction.

v3.24.1.1.u2

BASIS OF PRESENTATION	9 Months Ended
	Apr. 30, 2024
Accounting Policies [Abstract]
BASIS OF PRESENTATION	BASIS OF PRESENTATION The accompanying condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of a normal recurring nature) considered necessary for fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes for the year ended July 31, 2023 (Fiscal Year 2023), which are contained in the Company's Fiscal Year 2023 Form 10-K filed on November 8, 2023, as amended on November 28, 2023. Certain prior year amounts have been reclassified to conform to current year presentation. The results for the nine months ended April 30, 2024 are not necessarily indicative of the results to be expected for the full fiscal year. The year-end condensed consolidated balance sheet data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP. Predecessor/Successor Reporting On May 1, 2023, the Exchange Transaction resulted in Steel Holdings obtaining control of the Company for financial statement consolidation purposes. Steel Holdings does not consolidate the Company for Federal income tax purposes because the ownership in the Company is dispersed between different federal tax consolidation groups within Steel Holdings. As of May 1, 2023, the Company elected pushdown accounting in which it used Steel Holdings' basis of accounting, which reflected the fair market value of the Company’s assets and liabilities at the date of the Exchange Transaction. As a result, the Company has reflected the required pushdown accounting adjustments in its consolidated financial statements. Due to the application of pushdown accounting, the Company’s consolidated financial statements and certain footnote disclosures include a black line division between the two distinct periods to indicate the application of two different bases of accounting, which may not be comparable, between the periods presented. The pre-exchange period through April 30, 2023 is referred to as the "Predecessor" period. The post-exchange period, May 1, 2023 and onward, includes the impact of pushdown accounting and is referred to as the "Successor" period. As such for purposes of this quarterly report, all references to the three and nine months ended April 30, 2024 are for the Successor period, and all references to the three and nine months ended April 30, 2023 are for the Predecessor period. See Note 4 - "Exchange Transaction" for further information regarding the Exchange Transaction and the application of pushdown accounting. Reverse/Forward Stock Split At the special stockholders meeting held on June 6, 2023, the stockholders approved proposals to amend the Company’s restated certificate of incorporation (the “Charter”), to effect a 1-for-3,500 reverse stock split of the common stock (the “Reverse Stock Split”), followed immediately by a 375-for-1 forward stock split of the common stock (the “Forward Stock Split,” and, together with the Reverse Stock Split, the “Reverse/Forward Stock Split”). On June 7, 2023, Steel Connect's Board of Directors ("the Board") approved the Reverse/Forward Stock Split, and as such, the Board directed the Company to file with the State of Delaware certificates of amendment to our Charter to effectuate the Reverse/Forward Stock Split. The Reverse/Forward Stock Split was effective on June 21, 2023 (the “Effective Date”). The Company’s common stock began trading on a Reverse/Forward Stock Split-adjusted basis on the Nasdaq Capital Market when the market opened on June 22, 2023. The trading symbol for the Company’s common stock remains “STCN.” Accordingly, all share and per-share amounts for the current period and prior periods have been adjusted to reflect the Reverse/Forward Stock Split. Summary of Significant Accounting Policies Interest income is recognized when earned. All intercompany transactions and balances have been eliminated in consolidation. The Company considers events or transactions that occur after the balance sheet date but before the issuance of financial statements to provide additional evidence relative to certain estimates or to identify matters that require additional disclosure. For the nine months ended April 30, 2024, the Company evaluated subsequent events for potential recognition and disclosure through the date these financial statements were filed. The following significant accounting policy has been added from the policies described in the Fiscal Year 2023 Form 10-K: Investments Long-term investments consist of debt and equity securities. The Company determines the appropriate classifications of its investments at the acquisition date and re-evaluates the classifications at each balance sheet date. Equity securities that do not result in consolidation and are not accounted for under the equity method are measured at fair value, with any changes recognized in Other (losses) gains, net in the consolidated statements of operations in accordance with Accounting Standards Codification ("ASC") Topic 321, Investments - Equity Securities. The Company uses quoted market prices to determine the fair value of equity securities with readily determinable fair value. Available-for-sale debt securities are reported at fair value, with unrealized gains and losses recognized in accumulated other comprehensive income or loss as a separate component of the Company's stockholders' equity in accordance with ASC Topic 320, Investments - Debt Securities. To the extent that debt securities meet the definition of a hybrid security under ASC 815, Derivatives and Hedging, the Company may elect the fair value option under ASC 825, Financial Instruments to measure the entire hybrid instrument, with changes in fair value recorded in the Company's consolidated statements of operations.

v3.24.1.1.u2

RECENT ACCOUNTING PRONOUNCEMENTS	9 Months Ended
	Apr. 30, 2024
Accounting Policies [Abstract]
RECENT ACCOUNTING PRONOUNCEMENTS	RECENT ACCOUNTING PRONOUNCEMENTS Accounting Standards Issued and Not Yet Implemented In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which is intended to enhance the transparency, decision usefulness and effectiveness of income tax disclosures. The new guidance requires disaggregated information about the effective tax rate reconciliation and additional information on taxes paid that meet a quantitative threshold. The new guidance is effective for annual reporting periods beginning after December 15, 2024, with early adoption and retrospective application permitted. This guidance will be effective for the Company beginning in the fourth quarter in the fiscal year ending July 31, 2026. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statement disclosures; however, adoption is not expected to impact its consolidated balance sheets or statement of operations. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, allowing financial statement users to better understand the components of a segment's profit or loss to assess potential future cash flows for each reportable segment and the entity as a whole. The new guidance requires a public entity to disclose significant expenses and other segment items that are regularly reported to the chief operating decision maker ("CODM") and the nature of segment expense information used to manage operations. Additionally, it requires a public entity to disclose the title and position of the CODM. The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. The new guidance is effective for annual reporting periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. This guidance will be effective for the Company beginning in the fourth quarter in the fiscal year ending July 31, 2025. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statement disclosures; however, adoption is not expected to impact its consolidated balance sheets or statements of operations. In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40). The amendment in this update simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments and convertible preferred stock. This update also amends the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions and requires the application of the if-converted method for calculating diluted earnings per share. The update also requires entities to provide expanded disclosures about the terms and features of convertible instruments, how the instruments have been reported in the entity's financial statements and information about events, conditions and circumstances that can affect how to assess the amount or timing of an entity's future cash flows related to those instruments. The guidance is effective beginning in the first quarter of our fiscal year ending July 31, 2025, with early adoption permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements; however, adoption is not expected to impact its consolidated balance sheets or statements of operations. Other new pronouncements issued but not effective until after April 30, 2024 are not expected to have a material impact on our financial condition, results of operations or liquidity.

v3.24.1.1.u2

EXCHANGE TRANSACTION	9 Months Ended
	Apr. 30, 2024
Related Party Transactions [Abstract]
EXCHANGE TRANSACTION	EXCHANGE TRANSACTION Steel Partners and Steel Connect Exchange Transaction On April 30, 2023, the Company and Steel Holdings executed a series of agreements, in which the Steel Partners Group transferred an aggregate of 3,597,744 shares of common stock, par value $0.10 per share, of Aerojet Rocketdyne Holdings, Inc. ("Aerojet") held by the Steel Partners Group to the Company in exchange for 3.5 million shares of the Company's newly created Series E Convertible Preferred Stock (the “Series E Convertible Preferred Stock” and such transfer and related transactions, the "Exchange Transaction"). Following the approval by the Company's stockholders on June 6, 2023, pursuant to the rules of the Nasdaq Capital Market, the Series E Convertible Preferred Stock is convertible into an aggregate of 19.8 million shares of the Company's common stock, par value $0.01 per share (the “common stock” or “Common Stock”), and votes together with the Company's common stock and participates in any dividends paid on the Company's common stock, in each case on an as-converted basis. Upon conversion of the Series E Convertible Preferred Stock, when combined with the Steel Connect common stock, the 7.50% Convertible Senior Note, if converted, and the Steel Connect Series C Convertible Preferred Stock, also if converted, owned by Steel Holdings, would result in Steel Holdings holding approximately 84.0% of the outstanding equity interests of the Company as of May 1, 2023. The Exchange Transaction closed on May 1, 2023, the date that the consideration was exchanged between the Company and Steel Holdings, and as of that date the Company became a consolidated subsidiary of Steel Holdings for financial statement purposes. The Company is not consolidated by Steel Holdings for Federal income tax purposes because Steel Holdings' ownership in the Company is dispersed between different federal tax consolidation groups. The Company's assets and liabilities have been included in Steel Holdings' consolidated balance sheet, with a related noncontrolling interest of 16.0% of the Company's common stock. Prior to May 1, 2023, when including the if-converted value of the 7.50% Convertible Senior Note and the Steel Connect Series C Convertible Preferred Stock, Steel Holdings held a 49.6% ownership interest in the Company and accounted for its investment in the Company in accordance with the equity method of accounting. As of the date of the Exchange Transaction, Steel Holdings remeasured the previously held equity method investment to its fair value based upon a valuation of the Company. The Exchange Transaction was accounted for in accordance with ASC Topic 805, Business Combinations, and, accordingly, the Company's results of operations were consolidated in Steel Holdings' financial statements on the date of the Exchange Transaction. Steel Holdings recorded a preliminary allocation of the Exchange Transaction to assets acquired and liabilities assumed based on their estimated fair values as of May 1, 2023. Steel Holdings' final Exchange Transaction allocation was finalized as of December 31, 2023, with no significant changes to preliminary amounts. As discussed in Note 2 - "Basis of Presentation", the Company elected pushdown accounting in which it uses Steel Holdings' basis of accounting, which reflects the fair market value of the Company’s assets and liabilities at the date of the Exchange Transaction. The following table summarizes the total Exchange Transaction consideration: (in thousands) May 1, 2023 Fair value of Aerojet common stock $ 202,733  Fair value of previously held interest in Steel Connect and noncontrolling interest 111,816  Less: cash acquired from Steel Connect (65,896) Total estimated consideration, less cash acquired $ 248,653  The following represents the final calculation of goodwill and fair value amounts recognized. The Company notes that there were no measurement period adjustments made in the current period that would result in an updated preliminary fair value allocation. (in thousands) May 1, 2023 Assets Accounts receivable, trade $ 36,900  Inventories, net 6,900 Prepaid expenses and other current assets 4,957 Other intangible assets 35,500  Other assets 3,900  Property and equipment, net 3,400  Operating lease right-of-use assets 29,250  Investments 202,733  Estimated fair value of total assets acquired by Steel Holdings 323,540  Liabilities Accounts payable 26,300  Accrued expenses 29,100  Current lease obligations 7,994  Other current liabilities 7,236  Long-term lease obligations 21,300  Other long-term liabilities 5,742  Estimated fair value of total liabilities assumed by Steel Holdings 97,672  Fair value of identifiable net assets 225,868 Goodwill attributable to Steel Connect $ 22,785  In connection with the application of pushdown accounting, the Company calculated the amount of goodwill recognized based on the excess of the Exchange Transaction consideration over the fair value of net identifiable assets acquired and liabilities assumed. Goodwill is primarily attributable to expected synergies and the assembled workforce of the Company. The goodwill recognized will not be deductible for income tax purposes. Identifiable intangible assets were recognized at their estimated fair value as of the date of the Exchange Transaction. The fair value of the trade name asset was determined using the relief-from-royalty method and the fair value of the customer relationships asset was determined using the excess earnings method. These income-based approaches included assumptions such as the amount and timing of projected cash flows, growth rates, customer attrition rates, discount rates, and the assessment of the asset’s life cycle. The estimated fair value and estimated remaining useful lives of identifiable intangible assets as of the Exchange Transaction date were as follows: (in thousands) Useful Life (Years) Amount Customer relationships 7 $ 25,000  Trade name Indefinite 10,500  Estimated fair value of identifiable intangible assets $ 35,500

v3.24.1.1.u2

GOODWILL AND OTHER INTANGIBLE ASSETS, NET	9 Months Ended
	Apr. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL AND OTHER INTANGIBLE ASSETS, NET	GOODWILL AND OTHER INTANGIBLE ASSETS, NET In connection with the application of pushdown accounting, the Company recorded intangible assets for goodwill, customer relationships and tradenames. A reconciliation of the change in the carrying amount of goodwill by reportable segment is as follows: (in thousands) Supply Chain Balance at July 31, 2023 (Successor) Gross goodwill $ 22,785  Accumulated impairments —  Net goodwill $ 22,785  Balance at April 30, 2024 (Successor) Gross goodwill $ 22,785  Accumulated impairments —  Net goodwill $ 22,785  A summary of Other intangible assets, net is as follows: Successor April 30, 2024 July 31, 2023 (in thousands) Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Customer relationships $ 25,000  $ 3,571  $ 21,429  $ 25,000  $ 911  $ 24,089  Trade name 10,500  —  10,500  10,500  —  10,500  Total $ 35,500  $ 3,571  $ 31,929  $ 35,500  $ 911  $ 34,589  The trade name intangible asset has an indefinite useful life. Customer relationships are amortized on a straight-line basis. Amortization expense related to intangible assets was $0.9 million and $2.7 million for the three and nine months ended April 30, 2024, respectively. The Exchange Transaction closed on May 1, 2023, and as such, there was no intangible assets or related amortization expense for the three and nine months ended April 30, 2023. Based on gross carrying amounts at April 30, 2024, the Company's projection of amortization expense for identifiable intangible assets for the remainder of the fiscal year ending July 31, 2024, and fiscal years 2025 through 2028 and thereafter is presented in the table below: Fiscal Year Ending July 31, (in thousands) 2024 2025 2026 2027 2028 Thereafter Projected amortization expense $ 893  $ 3,571  $ 3,571  $ 3,571  $ 3,571  $ 6,252

v3.24.1.1.u2

INVENTORIES, NET	9 Months Ended
	Apr. 30, 2024
Inventory Disclosure [Abstract]
INVENTORIES, NET	INVENTORIES, NET The table below presents the components of Inventories, net: Successor April 30, 2024 July 31, 2023 (in thousands) Raw materials $ 6,271  $ 4,805  Work-in-process 258  239  Finished goods 945  3,525  $ 7,474  $ 8,569

v3.24.1.1.u2

INVESTMENTS	9 Months Ended
	Apr. 30, 2024
Investments, Debt and Equity Securities [Abstract]
INVESTMENTS	INVESTMENTS The following table summarizes the Company's investments as of April 30, 2024. There were no investments as of July 31, 2023. Successor (in thousands) April 30, 2024 Convertible loan note investment(a) $ —  Other investments(b) 14,293  Total $ 14,293  (a)    The Company entered into a new convertible loan note on October 13, 2023, which matures on March 31, 2025. The Company paid 1.0 million GBP (approximately $1.2 million) to subscribe for an amount of £1.0 million (the "loan principal") of 11.0% 2025 unsecured convertible loan notes issued by the investee (the "CLN Instrument Agreement"). Contemporaneous with the execution of the CLN Instrument Agreement, the Company executed the Equity Warrant Instrument Agreement (“Warrant Agreement”), which provides the Company with the option to convert the outstanding balance into equity shares of the investee at any time before repayment of the outstanding loan principal balance. The Company’s £1.0 million investment in the £20.0 million GBP 11.0% unsecured convertible loan notes provides it with an approximate 5.0% ownership interest on an if-converted basis. Changes in fair value will be recorded in the Company's condensed consolidated statements of operations as the Company elected the fair value option under ASC 825 to account for this investment. Changes in fair value are recorded in the Company's condensed consolidated statements of operations as the Company elected the fair value option under ASC 825 to account for this investment. In April 2024, the Company became aware that the investee had halted its operations while it undergoes a restructuring process. As a result, the Company determined that the fair value of the investment was zero. The Company recorded a loss of $1.2 million to Other (losses) gains, net on the condensed consolidated statements of operations during the three and nine months ended April 30, 2024, which was the fair value of the investment as of January 31, 2024. (b)    The balance consists of multiple common stock investments in public companies which are measured at fair value. The amount of unrealized net losses for the three and nine months ended April 30, 2024 that relate to equity securities still held as of April 30, 2024 are as follows: Successor Three months ended April 30, Nine months ended April 30, (in thousands) 2024 2024 Net losses recognized during the period on equity securities $ (872) $ (276) Less: Net (losses) gains recognized during the period on equity securities sold during the period (21) 372  Unrealized net losses recognized during the period on equity securities still held at the end of the period $ (851) $ (648) Unrealized net losses are recorded in Other (losses) gains, net on the condensed consolidated statements of operations. There was no investment activity for the three and nine months ended April 30, 2023.

v3.24.1.1.u2

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	9 Months Ended
	Apr. 30, 2024
Payables and Accruals [Abstract]
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES The following tables reflect the components of "Accrued expenses" and "Other current liabilities". Successor April 30, 2024 July 31, 2023 Accrued Expenses (in thousands) Accrued compensation $ 6,311  $ 6,891  Accrued audit, tax and legal 4,027  5,696  Accrued price concessions 2,587  2,981  Accrued taxes 1,796  2,811  Accrued occupancy costs 1,611  1,412  Accrued IT costs 648  831  Accrued travel 535  —  Accrued freight 447  502  Accrued contract labor 372  517  Accrued other 4,723  5,133  Total accrued expenses $ 23,057  $ 26,774  Successor April 30, 2024 July 31, 2023 Other Current Liabilities (in thousands) Deferred revenue - current 2,762  2,574  Other 1,571  1,970  Total other current liabilities $ 4,333  $ 4,544

v3.24.1.1.u2

LEASES	9 Months Ended
	Apr. 30, 2024
Leases [Abstract]
LEASES	LEASES The table below presents the components of the Company's lease expense: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, 2024 Nine Months Ended April 30, 2023 2024 2023 2024 2023 (in thousands) Operating lease cost $ 2,672  $ 2,636  $ 7,830  $ 7,538  Short-term lease expense 337  394  1,215  1,269  Variable lease cost —  —  —  7  Sublease income $ (61) $ (222) $ (352) $ (786) Total lease expense $ 2,948  $ 2,808  $ 8,693  $ 8,028  Supplemental Cash Flow Information Supplemental cash flow information related to the Company's leases was as follows: Successor Predecessor Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 (in thousands) Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 7,641  $ 7,224  Financing cash flows from finance leases $ —  $ 38
LEASES	LEASES The table below presents the components of the Company's lease expense: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, 2024 Nine Months Ended April 30, 2023 2024 2023 2024 2023 (in thousands) Operating lease cost $ 2,672  $ 2,636  $ 7,830  $ 7,538  Short-term lease expense 337  394  1,215  1,269  Variable lease cost —  —  —  7  Sublease income $ (61) $ (222) $ (352) $ (786) Total lease expense $ 2,948  $ 2,808  $ 8,693  $ 8,028  Supplemental Cash Flow Information Supplemental cash flow information related to the Company's leases was as follows: Successor Predecessor Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 (in thousands) Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 7,641  $ 7,224  Financing cash flows from finance leases $ —  $ 38

v3.24.1.1.u2

DEBT	9 Months Ended
	Apr. 30, 2024
Debt Disclosure [Abstract]
DEBT	DEBT The components of debt are presented in the table below: Successor April 30, 2024 July 31, 2023 (in thousands) Unsecured 7.50% Convertible Senior Note due September 1, 2024 $ 12,903  $ 12,461  Credit Facility Umpqua Revolver —  —  Total debt, net $ 12,903  $ 12,461  7.50% Convertible Senior Note On February 28, 2019, the Company entered into a 7.50% Convertible Senior Note Due 2024 Purchase Agreement (the "SPHG Note Purchase Agreement") with SPH Group Holdings LLC ("SPHG Holdings"), whereby SPHG Holdings agreed to loan the Company $14.9 million in exchange for a 7.50% Convertible Senior Note due 2024 (the "SPHG Note"). The SPHG Note was amended on March 9, 2023 (the "Amendment Date"), to extend the maturity date to September 1, 2024. In addition, the Company repaid $2.0 million in principal amount of the SPHG Note during Fiscal Year 2023. Refer to Note 18 - "Fair Value Measurements" for further information. As of both April 30, 2024 and July 31, 2023, the principal amount of the note was $12.9 million. As of May 1, 2023, or the date of the Exchange Transaction, the Company accounts for the SPHG Note under the fair value option in order to conform with Steel Holdings' basis of accounting, with changes in fair value recognized in earnings. Refer to Note 18 - "Fair Value Measurements" for further information. The fair value of the SPHG Note was reported as a current liability on the condensed consolidated balance sheets beginning in the first quarter of fiscal year 2024, as its maturity is less than twelve months. Below is a reconciliation of interest expense related to the SPHG Note to total interest expense: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Interest expense related to contractual interest coupon on the SPHG Note $ 243  $ 271  $ 739  $ 844  Interest expense related to accretion of the discount on the SPHG Note(a) —  632  —  1,688  Interest expense related to revolving credit facilities (see below) —  11  —  36  Other —  —  —  20  Total interest expense $ 243  $ 914  $ 739  $ 2,588  (a) Prior to the date of the Exchange Transaction, the discount on the SPHG Note was accreted using the effective interest rate method. The effective interest rate on the SPHG Note was 27.8% prior to the SPHG Note Amendment, and was 23.0% subsequent to the SPHG Note Amendment. Umpqua Revolver ModusLink, as borrower, is party to a revolving credit agreement with Umpqua Bank as lender and as agent, which provides for a maximum credit commitment of $12.5 million and a sublimit of $5.0 million for letters of credit (collectively, the "Umpqua Revolver"). On May 1, 2024, ModusLink, entered into a Second Amendment to the Umpqua Revolver (the “Second Amendment”). Among other things, the Second Amendment (i) extended the maturity date with respect to revolving loans from March 31, 2025 to March 31, 2026, (ii) removed certain adjustments in the definition of “Adjusted EBITDA” as set forth in the Umpqua Revolver, (iii) increased the minimum Adjusted Tangible Net Worth (as defined in the credit agreement) and (iv) removed certain caps and conditions on ModusLink’s ability to pay dividends. As of April 30, 2024, ModusLink was in compliance with the Umpqua Revolver's covenants, and believes it will remain in compliance with the Umpqua Revolver’s covenants for the next twelve months from the filing of this Form 10-Q. As of April 30, 2024, ModusLink had available borrowing capacity of $11.9 million and there was $0.6 million outstanding letters of credit.

v3.24.1.1.u2

CONTINGENCIES	9 Months Ended
	Apr. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
CONTINGENCIES	CONTINGENCIES Donald Reith v. Warren G. Lichtenstein, et al. On April 13, 2018, a purported shareholder, Donald Reith, filed a verified complaint, Reith v. Lichtenstein, et al., 2018-277 (Del. Ch.) in the Delaware Court of Chancery (the “Reith litigation”). The complaint alleges class and derivative claims for breach of fiduciary duty and/or aiding and abetting breach of fiduciary duty and unjust enrichment against certain current and former directors of the Company, Warren G. Lichtenstein, Glen M. Kassan, William T. Fejes, Jack L. Howard, Jeffrey J. Fenton, Philip E. Lengyel and Jeffrey S. Wald; and stockholders Steel Holdings and several of its affiliated companies (collectively, the "Steel Parties") in connection with the acquisition of $35.0 million of the Series C Convertible Preferred Stock by SPHG Holdings and equity grants made to Messrs. Lichtenstein, Howard and Fejes on December 15, 2017 (collectively, the "Challenged Transactions"). The Company is named as a nominal defendant. The complaint alleges that although the Challenged Transactions were approved by a Special Committee consisting of the independent members of the Board of Directors (Messrs. Fenton, Lengyel and Wald), the Steel Parties dominated and controlled the Special Committee, who approved the Challenged Transactions in breach of their fiduciary duty. Plaintiff alleges that the Challenged Transactions unfairly diluted stockholders and therefore unjustly enriched Steel Holdings, SPHG Holdings and Messrs. Lichtenstein, Howard and Fejes. The complaint also alleges that the Board of Directors made misleading disclosures in the Company's proxy statement for the 2017 Annual Meeting of Stockholders in connection with seeking approval to amend the 2010 Incentive Award Plan to authorize the issuance of additional shares to accommodate certain shares underlying the equity grants. Remedies requested include rescission of the Series C Convertible Preferred Stock and equity grants, disgorgement of any unjustly obtained property or compensation and monetary damages. On August 13, 2021, the Company, together with certain of its current and former directors of the Board, Warren Lichtenstein, Glen Kassan, William Fejes, Jr., Jack Howard, Jeffrey Fenton and Jeffrey Wald, as well as other named defendants (collectively, the “Defendants”), entered into a memorandum of understanding (the “MOU”) with Donald Reith (the “Plaintiff”) in connection with the settlement of the Reith v. Lichtenstein, et al., C.A. No. 2018-0277-MTZ (Del. Ch. 2018) class and derivative action. A definitive Stipulation of Settlement (the “Stipulation”) incorporating the terms of the MOU was filed with the Court on February 18, 2022. Pursuant to the MOU and Stipulation, and contingent on approval of the terms by the court, the Defendants agreed to cause their directors’ and officers’ liability insurance carriers to pay to the Company $2.8 million in cash. The Company's insurance carrier agreed to pay $1.7 million and Steel Holdings' insurance carrier agreed to pay $1.1 million of the settlement. Additionally, under the MOU and separate letter agreements between the Company and such individuals (the “Surrender Agreements”), Messrs. Lichtenstein, Howard and Fejes agreed to surrender to the Company an aggregate 353,571 shares that they had initially received in December 2017 in consideration for services to the Company. The surrenders and cancellations are in the following amounts: for Mr. Lichtenstein, 196,429 vested shares and 32,143 unvested shares; for Mr. Howard, 98,214 vested shares and 16,071 unvested shares; and for Mr. Fejes, 10,714 vested shares. On August 17, 2021, Mr. Lichtenstein and Mr. Howard surrendered the shares required under the MOU, the Stipulation and their respective Surrender Agreements, and in December 2021 Mr. Fejes did the same. All such shares were subsequently cancelled. Pursuant to the MOU and Stipulation, the Company also agreed to pay the Plaintiff’s counsel legal fees for this matter in an amount up to $2.05 million, if approved by the court. On September 23, 2022, the court ruled that it was denying approval of the settlement. On September 12, 2023, the court approved a stipulated pretrial and trial schedule culminating in a trial scheduled for September 2024. On June 6, 2023, the Company received a books and records demand from Reith under Delaware General Corporation Law Section 220 which requests an array of documents for the purported purposes of investigating potential wrongdoing in connection with the April 30, 2023 transaction between Steel Holdings and Steel Connect. On April 8, 2024, the Company, the Defendants and Mr. Reith entered into a new memorandum of understanding (the "New MOU") contemplating the settlement of the Reith litigation (the "2024 Settlement"). If the 2024 Settlement is approved by the Court, (i) the Defendants shall cause their insurers to make a cash payment of $6.0 million to the Company and, after deducting any Court-approved award of attorneys’ fees to Plaintiff's counsel and certain litigation expenses, the Company shall distribute the balance of the cash payment, by way of a special divided or other distribution, to the holders of the Company’s common stock pursuant to the allocation provisions set forth in the previously disclosed Stockholders Agreement dated April 20, 2023 by and among the Company, Steel Partners Holdings L.P., and other stockholders signatory thereto (the “Stockholders’ Agreement”) as amended by the 2024 Settlement; (ii) the Company will adopt certain amendments to the Stockholders’ Agreement; and (iii) the Company will adopt certain corporate governance policies and practices, including a formal review process for compensation clawbacks, enhancing the process for granting equity awards and keeping records of equity awards granted under the Company’s stock plans, further enhancing board committee independence, and reducing the materiality threshold for review of related party transactions under the Stockholders Agreement, in exchange for which all parties will be released from all claims in the Reith litigation. The 2024 Settlement requires Court approval, and there can be no assurances that such approval will be granted. On December 12, 2023, the Company received books and records demand, similar to the demand from Reith, from another purported shareholder. The possible liability, if any, with respect to this matter cannot be determined. Mohammad Ladjevardian v. Warren G. Lichtenstein, et al. On September 1, 2023, a purported stockholder, Mohammad Ladjevardian, filed a verified complaint alleging a single direct claim for breach of fiduciary duty against members of Steel Connect’s Board of Directors and Steel Holdings and certain of its affiliates in connection with the Exchange Transaction. Directors named in the complaint are Warren Lichtenstein, Glen Kassan, and Jack Howard. The complaint alleges that although the challenged transaction was approved by the independent Strategic Planning Committee, the committee failed to obtain a “control premium” or to consider the dilutive effect that the Series E Convertible Preferred Stock issuance had on the plaintiff’s holdings. Remedies requested in the complaint include rescission of the Series E Convertible Preferred Stock and a judicially imposed requirement that all future transactions involving Steel Holdings and its affiliates be subject to minority stockholder approval. On September 27, 2023, the entity defendants moved to dismiss the complaint. On October 5, 2023, the individual defendants moved to dismiss the complaint. On April 18, 2024, in order to avoid the cost and uncertainty of litigation, Messrs. Lichtenstein and Howard, Steel Holdings, Steel Excel and WebFinancial, without admitting any wrongdoing, entered into a Settlement Agreement and Securities Purchase Agreements (the "SPAs") with the Estate of Mohammad Ladjevardian and certain parties related to Mohammad Ladjevardian (the "Ladjevardian Parties"). Pursuant to the SPAs, a Steel Holdings subsidiary purchased an aggregate of 701,246 shares of the Company’s common stock held by the Ladjevardian Parties at a price of $9.83 per share, which represented the closing market price of the shares on April 17, 2024 and made an aggregate cash settlement payment of $1.5 million to the Ladjevardian Parties.

v3.24.1.1.u2

REVENUE RECOGNITION	9 Months Ended
	Apr. 30, 2024
Revenue from Contract with Customer [Abstract]
REVENUE RECOGNITION	REVENUE RECOGNITION Disaggregation of Revenue The following table presents the Company's revenues from contracts with customers disaggregated by major good or service line and timing of revenue recognition. The table also includes a reconciliation of the disaggregated revenue with the reportable segments. Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Major Goods/Service Lines Supply chain management services $ 43,456  $ 45,826  $ 127,157  $ 147,185  Other 399  316  1,083  1,098  $ 43,855  $ 46,142  $ 128,240  $ 148,283  Timing of Revenue Recognition Services transferred over time $ 43,855  $ 46,142  $ 128,240  $ 148,283  $ 43,855  $ 46,142  $ 128,240  $ 148,283  Supply Chain Management Services ModusLink's revenue primarily comes from the sale of supply chain management services to its clients. Amounts billed to customers under these arrangements include revenue attributable to the services performed as well as for materials procured on the customer's behalf as part of its service to them. The majority of these arrangements consist of two distinct performance obligations (i.e., warehousing/inventory management service and a separate kitting/packaging/assembly service), revenue related to each of which is recognized over time as services are performed using an input method based on the level of efforts expended. Other Other revenue consists of cloud-based software subscriptions, software maintenance and support service contracts, and fees for professional services. Revenue related to these arrangements is recognized on a straight-line basis over the term of the agreement or over the term of the agreement in proportion to the costs incurred in satisfying the obligations under the contract. Contract Balances Timing of revenue recognition may differ from timing of invoicing to customers. The Company records contract assets and liabilities related to its contracts with customers as follows: •Accounts receivable when revenue is recognized prior to receipt of cash payments and if the right to such amounts is unconditional and solely based on the passage of time. •Contract asset when the Company recognizes revenue based on efforts expended but the right to such amount is conditional upon satisfaction of another performance obligation. Contract assets are primarily comprised of fees related to supply chain management services. The Company's contract assets are all short-term in nature and are included in prepaid expenses and other current assets in the condensed consolidated balance sheets. •Deferred revenue when cash payments are received or due in advance of performance. Deferred revenue is primarily comprised of fees related to supply chain management services, cloud-based software subscriptions and software maintenance and support service contracts, which are generally billed in advance. Deferred revenue also includes other offerings for which we have been paid in advance and earn the revenue when we transfer control of the product or service. The deferred revenue balance is classified as a component of other current liabilities and other long-term liabilities on the Company's condensed consolidated balance sheets. The table below presents information for the Company's contract balances: Successor Predecessor April 30, 2024 July 31, 2023 August 1, 2022 (in thousands) Accounts receivable, trade, net $ 31,873  $ 28,616  $ 40,083  Contract assets 283  439  369  Deferred revenue - current $ 2,762  $ 2,574  $ 2,705  Deferred revenue - long-term 68  144  134  Total deferred revenue $ 2,830  $ 2,718  $ 2,839  Remaining Performance Obligations Remaining performance obligations are comprised of deferred revenue. Changes in deferred revenue during the nine months ended April 30, 2024 and April 30, 2023, were as follows: Successor Predecessor Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 (in thousands) Balance at beginning of period $ 2,718  $ 2,839  Deferral of revenue 1,456  1,595  Recognition of deferred amounts upon satisfaction of performance obligation (1,344) (1,361) Balance at end of period $ 2,830  $ 3,073  The Company expects to recognize approximately $2.8 million of deferred revenue over the next twelve months and the remaining $0.1 million beyond that time period. The Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed.

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INCOME TAXES	9 Months Ended
	Apr. 30, 2024
Income Tax Disclosure [Abstract]
INCOME TAXES	INCOME TAXES The Company operates in multiple taxing jurisdictions, both within and outside of the United States. For the nine months ended April 30, 2024, the Company was profitable in certain jurisdictions, resulting in an income tax expense using enacted rates in those jurisdictions. As of both April 30, 2024 and July 31, 2023, the total amount of the liability for unrecognized tax benefits related to federal, state and foreign taxes was approximately $0.4 million. Deferred Income Taxes As of April 30, 2024, the Company reassessed the need for a valuation allowance against its deferred tax assets. After considering historical and projected future taxable income and existing taxable temporary differences, the Company determined that it is more likely than not that the deferred tax assets will be realized. As a result, the Company released substantially all of its valuation allowance except the valuation allowance relating to approximately $31.0 million of NOLs that will expire as of July 31, 2024, and approximately $0.9 million of state NOLs that the Company anticipates will expire unutilized. This release of the valuation allowance resulted in a one-time non-cash income tax benefit of $71.5 million for the quarter ended April 30, 2024. Uncertain Tax Positions In accordance with the Company's accounting policy, interest related to unrecognized tax benefits is included in the income tax expense line of the condensed consolidated statements of operations. As of both April 30, 2024 and July 31, 2023, the liabilities for interest expense related to uncertain tax positions was less than $0.1 million. The Company expects $0.3 million of unrecognized tax benefits and related interest to reverse in the next twelve months. Management's judgment is required in determining our provision for income taxes, including any valuation allowance recorded against the Company’s deferred tax assets due to uncertainties related to our ability to utilize these assets. The valuation allowance is based on our estimates of taxable income and the period over which the Company’s deferred tax assets will be recoverable. The evolution of facts and circumstances in future periods may result in adjustments to our valuation allowance, which could materially impact our financial position and results of operation. The Company is subject to U.S. federal income tax and various state, local and international income taxes in numerous jurisdictions. The federal and state tax returns are generally subject to tax examinations for the tax years ended July 31, 2020 through July 31, 2023. To the extent the Company has tax attribute carryforwards, the tax year in which the attribute was generated may still be adjusted upon examination by the Internal Revenue Service or state tax authorities to the extent utilized in a future period. In addition, a number of tax years remain subject to examination by the appropriate government agencies for certain countries in the Europe and Asia regions. In Europe, the Company's 2015 through 2022 tax years remain subject to examination in most locations, while the Company's 2010 through 2021 tax years remain subject to examination in most Asia locations.

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EARNINGS PER SHARE	9 Months Ended
	Apr. 30, 2024
Earnings Per Share [Abstract]
EARNINGS PER SHARE	EARNINGS PER SHARE As discussed in Note 2 - "Basis of Presentation", the Reverse/Forward Stock Split was effective on June 21, 2023. The Company’s shares of outstanding common stock and earnings per share amounts have been retroactively restated for all periods presented for the Reverse/Forward Stock Split. The following table reconciles net earnings per share for the three and nine months ended April 30, 2024 and 2023: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands, except per share data) Reconciliation of net income to net income attributable to common stockholders after assumed conversions: Net income $ 71,660  $ 3,029  $ 81,442  $ 7,460  Less: Preferred dividends on Series C redeemable preferred stock (531) (519) (1,604) (1,593) Net income available to common stockholders 71,129  2,510  79,838  5,867  Less: Undistributed earnings allocated to participating securities (54,125) —  (60,780) —  Net income attributable to common stockholders $ 17,004  $ 2,510  $ 19,058  $ 5,867  Effect of dilutive securities: Interest and debt amortization costs on convertible debt 243  —  739  —  Dividends on Series C preferred stock 531  519  1,604  1,593  Undistributed earnings allocated to Series E preferred stock 54,125  —  60,780  —  Net income attributable to common stockholders - assuming dilution $ 71,903  $ 3,029  $ 82,181  $ 7,460  Net income per common share - basic $ 2.73  $ 0.39  $ 3.07  $ 0.91  Net income per common share - diluted $ 2.51  $ 0.36  $ 2.88  $ 0.89  Weighted average common shares outstanding - basic 6,224  6,461  6,211  6,449  Effect of dilutive securities: Common stock equivalents - Restricted stock and restricted stock shares 68  57  62  55  Common stock equivalents - Convertible debt 584  —  584  —  Common stock equivalents - Series C Preferred stock 1,913  1,913  1,913  1,913  Common stock equivalents - Series E Preferred stock 19,810  —  19,810  —  Weighted average common shares outstanding - diluted 28,599  8,431  28,580  8,417  For the three and nine months ended April 30, 2024, the Company calculated basic and diluted net income per common share using the two-class method, as the Series E Convertible Preferred Stock meets the definition of a participating security. The two-class method is an allocation formula that determines net income per common share for each share of common stock and Series E Convertible Preferred Stock, a participating security, according to dividends declared and participation rights in undistributed earnings. Under this method, all earnings (distributed and undistributed) are allocated to common shares and Series E Convertible Preferred Stock based on their respective rights to receive dividends. The holders of Series E Convertible Preferred Stock are entitled to participate equally and ratably with the holders of shares of Common Stock in all dividends or other distributions on the shares of Common Stock as if, immediately prior to each record date for payment of dividends or other distributions on the Common Stock, shares of Series E Preferred Stock then outstanding were converted into shares of Common Stock. Basic net income per common share is computed by dividing net income attributable to common stockholders for the period by the weighted average number of common shares outstanding for the period. Net income attributable to common stockholders for the period includes any dividends paid to common stockholders during the period plus a proportionate share of undistributed net income allocable to common stockholders for the period; the proportionate share of undistributed net income allocable to common stockholders for the period is based on the proportionate share of total weighted-average common shares and participating securities outstanding during the period. Diluted net income per common share is computed based on the weighted average number of shares of common stock outstanding during each period, plus potential common shares considered outstanding during the period, as long as the inclusion of such awards is not antidilutive. Potential common shares consist of restricted common stock (calculated based on the treasury stock method) and shares issuable upon debt or preferred stock conversion (calculated using an as-if converted method), using the more dilutive of either the two-class method or as-converted stock method. The Company was not required to apply the two-class method during the Predecessor Period as there were no participating securities, and as such, there were no changes to the Predecessor Period other than the retrospective restatement for the Reverse/Forward Stock Split discussed previously. The below details certain exclusions from the calculation of diluted net income per share, as their inclusion would have been antidilutive: For the three months ended April 30, 2023, $0.7 million of interest expense, net of tax related to the SPHG Note was excluded from the numerator in the calculation of diluted net income per share as its inclusion would have been antidilutive. For the three months ended April 30, 2023, 0.6 million common stock equivalent shares (including those related to the SPHG Note) were excluded from the denominator in the calculation of diluted net income per share as their inclusion would have been antidilutive. For the nine months ended April 30, 2023, $2.3 million of interest expense, net of tax impact related to the SPHG Note was excluded from the numerator in the calculation of diluted net income per share as its inclusion would have been antidilutive. For the nine months ended April 30, 2023, 0.6 million common stock equivalent shares (including those related to the SPHG Note) were excluded from the denominator in the calculation of diluted net income per share as their inclusion would have been antidilutive. No exclusions were required from the calculation of diluted net income per share for the three and nine months ended April 30, 2024, as all securities were considered dilutive.

v3.24.1.1.u2

COMPREHENSIVE (LOSS) INCOME	9 Months Ended
	Apr. 30, 2024
Equity [Abstract]
COMPREHENSIVE (LOSS) INCOME	COMPREHENSIVE (LOSS) INCOME Comprehensive (loss) income combines net income and other comprehensive items. Other comprehensive items represent certain amounts that are reported as components of stockholders' equity in the accompanying condensed consolidated balance sheets. Accumulated other comprehensive items consist of the following: Foreign Currency Items Pension Items Total (in thousands) Accumulated other comprehensive (loss) income as of July 31, 2023 (Successor) $ (623) $ 36  $ (587) Foreign currency translation adjustment (341) —  (341) Net current-period other comprehensive loss (341) —  (341) Accumulated other comprehensive (loss) income as of April 30, 2024 (Successor) $ (964) $ 36  $ (928) Foreign Currency Items Pension Items Total (in thousands) Accumulated other comprehensive income (loss) as of July 31, 2022 (Predecessor) $ 6,063  $ (1,923) $ 4,140  Foreign currency translation adjustment 999  —  999  Pension liability adjustments, net of tax —  (1,078) (1,078) Net current-period other comprehensive income (loss) 999  (1,078) (79) Accumulated other comprehensive income (loss) as of April 30, 2023 (Predecessor) $ 7,062  $ (3,001) $ 4,061  During the year ended July 31, 2020, a Netherlands defined benefit pension plan was amended, so that active participants no longer accrued benefits as of January 1, 2020, which resulted in a pre-tax curtailment gain of $2.4 million recognized in accumulated other comprehensive income (loss). At that time, the active plan participants were moved into a new defined benefit contribution pension plan. During the nine months ended April 30, 2023, the Company recorded an increase of approximately $1.1 million to accrued pension liabilities for the defined benefit pension plan as it was determined plan participants are entitled to unconditional indexation of benefits for as long as they remain in active service with the Company.

v3.24.1.1.u2

SEGMENT INFORMATION	9 Months Ended
	Apr. 30, 2024
Segment Reporting [Abstract]
SEGMENT INFORMATION	SEGMENT INFORMATION The Company has one reportable segment: Supply Chain. The Company also has Corporate-level activity, which consists primarily of costs associated with certain corporate administrative functions such as legal, finance and share-based compensation, which are not allocated to the Company's reportable segment. The Corporate-level balance sheet information includes cash and cash equivalents, debt and other assets and liabilities which are not allocated to the operations of the Company's operating segment. All significant intra-segment amounts have been eliminated. Management evaluates segment performance based on segment net revenue and operating income (loss). Summarized financial information of the Company's continuing operations by operating segment is as follows: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Net revenue: Supply Chain $ 43,855  $ 46,142  $ 128,240  $ 148,283  Total segment net revenue $ 43,855  $ 46,142  $ 128,240  $ 148,283  Operating income: Supply Chain $ 4,448  $ 5,249  $ 10,187  $ 16,488  Total segment operating income 4,448  5,249  10,187  16,488  Corporate-level activity (1,468) (4,944) (3,680) (9,699) Total operating income 2,980  305  6,507  6,789  Total other income, net 880  3,575  8,000  2,301  Income before income taxes $ 3,860  $ 3,880  $ 14,507  $ 9,090  Successor April 30, 2024 July 31, 2023 (in thousands) Total assets: Supply Chain $ 160,565  $ 146,614  Corporate 324,897  264,567  Total assets $ 485,462  $ 411,181  Summarized financial information of the Company's capital expenditures and depreciation expense for the Supply Chain reportable segment is as follows: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Capital expenditures $ 1,211  $ 445  $ 2,911  $ 1,311  Depreciation expense $ 439  $ 503  $ 1,324  $ 1,427  Summarized financial information of the Company's net revenue by geographic location is as follows: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Mainland China $ 15,822  $ 13,852  $ 45,577  $ 48,049  United States 9,776  12,917  31,593  38,262  Netherlands 5,035  4,872  16,121  15,149  Singapore 4,413  4,705  12,332  14,940  Czech Republic 4,241  6,202  9,436  19,497  Other 4,568  3,594  13,181  12,386  Total consolidated net revenue $ 43,855  $ 46,142  $ 128,240  $ 148,283

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RELATED PARTY TRANSACTIONS	9 Months Ended
	Apr. 30, 2024
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS As of April 30, 2024, SPHG Holdings and its affiliates, including Steel Holdings, Handy & Harman Ltd. and Steel Partners Ltd., beneficially owned approximately 89.6% of our outstanding capital stock, including the if-converted value of the SPHG Note and shares of Series C Convertible Preferred Stock and Series E Convertible Preferred Stock that vote on an as-converted basis together with our common stock. Warren G. Lichtenstein, our Interim Chief Executive Officer and the Executive Chairman of our Board, is also the Executive Chairman of Steel Holdings GP. Glen Kassan, our Vice Chairman of the Board of Directors and former Chief Administrative Officer, is an employee of Steel Services. Jack L. Howard, the President and a director of Steel Holdings GP, is also a director. Joseph Martin, one of our directors, is the Chief Administrative Officer and Chief Legal Officer of Steel Holdings. Ryan O'Herrin, our Chief Financial Officer, is the Chief Financial Officer of Steel Holdings. Upon closing of the Exchange Transaction on May 1, 2023, the Company became a consolidated subsidiary of Steel Holdings as described in Note 1 - "Nature of Operations", Note 2 - "Basis of Presentation", and Note 4 - "Exchange Transaction". After May 1, 2023, transactions between Steel Holdings and the Company are eliminated in consolidation by Steel Holdings. SPHG Note Transaction On February 28, 2019, the Company entered into the SPHG Note Purchase Agreement with SPHG Holdings, whereby SPHG Holdings agreed to loan the Company $14.9 million in exchange for the SPHG Note. On March 9, 2023 (the "Amendment Date"), the Company and SPHG Holdings entered into an amendment to the SPHG Note. Pursuant to the SPHG Note Amendment, the maturity date of the SPHG Note was extended six months from March 1, 2024 to September 1, 2024. The Company repaid $1.0 million in principal amount of the SPHG Note on the Amendment Date, and repaid an additional $1.0 million principal amount of the note on June 9, 2023. In connection with the SPHG Note Amendment, the Company also paid SPHG Holdings a cash amendment fee of $0.1 million, and derecognized $0.2 million of the debt discount in proportion to the reduction of the principal balance on the Amendment Date in the third quarter of Fiscal Year 2023. No other changes were made to the terms of the SPHG Note besides the items discussed. SPHG Holdings has the right, at its option, prior to the close of business on the business day immediately preceding the maturity date of the SPHG Note, to convert the SPHG Note or a portion thereof that is $1,000 or an integral multiple thereof, into shares of common stock (if the Company has not received a required stockholder approval) or cash, shares of common stock or a combination of cash and shares of common stock, as applicable (if the Company has received a required stockholder approval), at an initial conversion rate of 45.1356 shares of common stock, which is equivalent to an initial conversion price of approximately $22.16 per share (subject to adjustment as provided in the SPHG Note) per $1,000 principal amount of the SPHG Note, subject to, and in accordance with, the settlement provisions of the SPHG Note. As of April 30, 2024, the if-converted value of the SPHG Note did not exceed the principal value of the SPHG Note. Refer to Note 10 - "Debt" for further information. Series C Preferred Stock Transaction On December 15, 2017, the Company entered into a Preferred Stock Purchase Agreement with SPHG Holdings, pursuant to which the Company issued 35,000 shares of the Company's newly created Series C Convertible Preferred Stock to SPHG Holdings at a price of $1,000 per share, for an aggregate purchase consideration of $35.0 million. The terms, rights, obligations and preferences of the Series C Convertible Preferred Stock are set forth in the Series C Certificate of Designations, which has been filed with the Secretary of State of the State of Delaware. During each of the three months ended April 30, 2024 and 2023, the Company paid dividends of $0.5 million associated with the Series C Convertible Preferred Stock. During each of the nine months ended April 30, 2024 and 2023, the Company paid dividends of $1.6 million associated with the Series C Convertible Preferred Stock. On or after December 15, 2022, each holder of Series C Convertible Preferred Stock can also require the Company to redeem its Series C Convertible Preferred Stock in cash at a price equal to the Liquidation Preference (as defined in Series C Certificate of Designations). Series E Preferred Stock Transaction On May 1, 2023, the Company and Steel Holdings executed a series of agreements in which the Steel Partners Group agreed to transfer certain marketable securities held by the Steel Partners Group to Steel Connect in exchange for 3.5 million shares of Series E Convertible Preferred Stock of Steel Connect (the “Series E Convertible Preferred Stock”, and, such transfer, the “Transfer and Exchange Agreement”). Pursuant to the Transfer and Exchange Agreement, the Company held a special stockholders’ meeting on June 6, 2023 (the “Special Meeting”) to consider and vote upon the rights of the Series E Preferred Stock to vote and receive dividends together with the Common Stock on an as-converted basis and the issuance of the Company's common stock (the "Common Stock") upon conversion of the Series E Preferred Stock by the holders at their option, pursuant to the rules and regulations of Nasdaq (the “Nasdaq Proposal”). Following approval of the Nasdaq Proposal by the Steel Connect stockholders (the “Stockholder Approval”), the Series E Convertible Preferred Stock became convertible into an aggregate of 19.8 million shares of Common Stock, and votes together with holders of Company Common Stock and participates in any dividends paid on the Common Stock, in each case on an as-converted basis. The terms, rights, obligations and preferences of the Series E Convertible Preferred Stock are set forth in a Certificate of Designations, Preferences and Rights of Series E Convertible Preferred Stock of the Company (the “Series E Certificate of Designations”). Stockholders' Agreement Concurrently with the execution of the Transfer and Exchange Agreement, the Company, Steel Holdings, Steel Excel, WebFinancial, WHX CS, LLC, WF Asset Corp., Steel Partners Ltd., Warren G. Lichtenstein and Jack L. Howard (together, the "SP Investors") entered into a Stockholders' Agreement dated as of April 30, 2023 (the "Stockholders' Agreement"). Pursuant to the Stockholders' Agreement, the parties agreed to certain aspects of the Company's governance, including the maintenance of the Board size at seven directors and the creation of an audit committee consisting of at least three independent directors under SEC and applicable stock exchange rules (an "Independent Audit Committee") or one consisting of at least three directors, at least one of whom qualifies as independent under SEC and applicable stock exchange rules and the remainder of whom are not affiliated, as described in the Stockholders’ Agreement, with the Company or the SP Investors or their subsidiaries or affiliates (the “Disinterested Audit Committee”). The Stockholders' Agreement further provides that (a) prior to September 1, 2025 the prior approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable, is required for the following: (i) a voluntary delisting of the common stock from the applicable stock exchange or a transaction (including a merger, recapitalization, stock split or otherwise) which results in the delisting of the common stock, Steel Connect ceasing to be an SEC reporting company, or Steel Connect filing a Form 25 or Form 15 or any similar form with the SEC; (ii) an amendment to the terms of the STCN Management Services Agreement (the "Services Agreement") dated June 14, 2019, by and between Steel Connect and Steel Services Ltd.; and (iii) any related party transaction between Steel Connect and the SP Investors and their subsidiaries and affiliates; (b) prior to September 1, 2028, the prior approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable, is required for the Board to approve a going private transaction pursuant to which Steel Holdings or its subsidiaries or affiliates acquires the outstanding shares of common stock they do not own (or any alternative transaction that would have the same impact); and (c) until the Final Sunset Date (as defined in the Stockholders' Agreement), the prior approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable, is required (i) for the Board to approve a short-form or squeeze-out merger between Steel Connect and the SP Investors; or (ii) prior to any transfer of equity interests in Steel Connect by the members of the SP Group (as defined in the Stockholders' Agreement) if such transfers would result in 80% of the voting power and value of the equity interests in Steel Connect that are held by the members of the SP Group being held by one corporate entity. Currently, the Stockholders' Agreement also provides that 70% of the net proceeds received by the Company upon resolution of the Reith litigation will be distributed to the Company’s stockholders with the SP Investors agreeing to waive their portion of any such distribution to the extent of any shares of common stock held as of the date of the Stockholders’ Agreement or issuable upon conversion of the Series E Convertible Preferred Stock held by the SP Investors and the Series C Convertible Preferred Stock of Steel Connect, and the SPHG Note. Any amendment to the Stockholders’ Agreement by the Company prior to the date that any person or group of related persons owns 100% of the equity securities of the Company requires the prior approval of the Independent Audit Committee or the Disinterested Audit Committee, as applicable. As described in the notes to the financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, if the 2024 Settlement is approved, the Company will make certain changes to the Stockholders’ Agreement as described above. Steel Connect Management Services Agreement On June 14, 2019, the Company entered into an agreement (the "STCN Management Services Agreement") with Steel Services Ltd. ("Steel Services"), an indirect wholly-owned subsidiary of Steel Holdings. The STCN Management Services Agreement was effective as of June 1, 2019. Pursuant to the STCN Management Services Agreement, Steel Services provides the Company and its subsidiaries with the non-exclusive services of certain employees, including certain executive officers (including chief financial officer and general counsel services) and other corporate services. The STCN Management Services Agreement also provides for reimbursements to Steel Services and its representatives for all reasonable expenses incurred in providing the non-exclusive services and automatically renews for successive one year periods unless and until terminated by the Company or Steel Services. On February 25, 2022, in connection with the Company's disposal of its ownership in IWCO Direct Holdings, Inc., the management fee was reduced from $282.8 thousand per month to $101.9 thousand per month. On October 25, 2023, the Company and Steel Services entered into Amendment No. 2 to the STCN Management Services Agreement, pursuant to which the parties agreed to increase the monthly fee to $131.0 thousand effective as of January 1, 2024, primarily to increase the business development and mergers and acquisition staffing needed to originate, analyze and pursue strategic acquisitions and investments. Prior to the effective date of Amendment No. 2 to the STCN Management Services Agreement, expenses incurred by ModusLink were paid to Steel Services under the STCN Management Services Agreement. ModusLink Management Services Agreement On October 25, 2023, ModusLink entered into a management services agreement (the “ModusLink Management Services Agreement”) with Steel Services, effective as of January 1, 2024. Pursuant to the ModusLink Management Services Agreement, Steel Services will provide ModusLink with certain non-exclusive services of certain employees and executive officers to serve in various positions or functions and to perform duties normally associated with those specific to, or substantially equivalent, positions or functions for ModusLink based on its particular needs. Such services include, but are not limited to, services related to legal and environmental, health and safety, finance, tax and treasury, human resources, “lean,” internal audit, mergers and acquisitions, and information technology. Previously, the terms regarding such non-exclusive services were governed by the STCN Management Services Agreement. The ModusLink Management Services Agreement provides that ModusLink will pay Steel Services a fixed monthly fee of $80.0 thousand in consideration of the non-exclusive services and will reimburse Steel Services and its representatives for all reasonable expenses incurred in providing the services. The ModusLink Management Services Agreement will automatically renew for successive one-year periods unless and until terminated by ModusLink or Steel Services. Total expenses incurred related to the management services agreements for the three months ended April 30, 2024 and 2023 were $0.9 million and $0.6 million, respectively. Total expenses incurred related to the management services agreements for the nine months ended April 30, 2024 and 2023 were $2.2 million and $1.7 million, respectively. As of April 30, 2024 and July 31, 2023, amounts due to Steel Services were $0.6 million and $0.7 million, respectively, and are recorded within the condensed consolidated balance sheets as a component of Accounts payable. Air Travel The Company reimburses SP General Services, LLC (an affiliate of Steel Holdings), rather than Steel Services, for expenses for business-related air travel, which relates to services provided to the Company by Warren G. Lichtenstein as Interim Chief Executive Officer as well as certain of the Company’s executive officers whose services are provided to the Company under the STCN Management Services Agreement or the ModusLink Management Services Agreement. During the three and nine months ended April 30, 2024, SP General Services, LLC incurred $0.4 million and $0.5 million in expenses for business-related air travel. During the three and nine months ended April 30, 2023, SP General Services, LLC did not incur any reportable expenses for such business-related air travel. As of April 30, 2024, amounts due to SP General Services, LLC were $0.5 million. There was no balance due to SP General Services, LLC as of July 31, 2023.

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FAIR VALUE MEASUREMENTS	9 Months Ended
	Apr. 30, 2024
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	FAIR VALUE MEASUREMENTS Assets and Liabilities that are Measured at Fair Value on a Recurring Basis The following tables present the Company's financial assets and liabilities measured at fair value on a recurring basis as of April 30, 2024 and July 31, 2023, classified by fair value hierarchy: Successor Fair Value Measurements at Reporting Date Using (in thousands) April 30, 2024 Level 1 Level 2 Level 3 Assets: Money market funds $ 254,118  $ 254,118  $ —  $ —  Convertible loan note investment $ —  $ —  $ —  $ —  Other investments $ 14,293  $ 14,293  $ —  $ —  Liabilities: SPHG Note $ 12,903  $ —  $ —  $ 12,903  Successor Fair Value Measurements at Reporting Date Using (in thousands) July 31, 2023 Level 1 Level 2 Level 3 Assets: Money market funds $ 85,269  $ 85,269  $ —  $ —  Liabilities: SPHG Note $ 12,461  $ —  $ —  $ 12,461  There were no transfers between Levels 1, 2 or 3 during any of the periods presented. ASC 820, Fair Value Measurement, provides that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820 requires the Company to use valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs Level 3: Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants would price the assets or liabilities When available, quoted prices are used to determine fair value. When quoted prices in active markets are available, investments are classified within Level 1 of the fair value hierarchy. When quoted prices in active markets are not available, fair values are determined using pricing models, and the inputs to those pricing models are based on observable market inputs. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others. Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis The Company reviews the carrying amounts of these assets whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. An impairment loss is recognized when the carrying amount of the asset group or reporting unit is not recoverable and exceeds its fair value. The Company estimates the fair values of assets subject to impairment based on the Company's own judgments about the assumptions that market participants would use in pricing the assets and on observable market data, when available. Fair Value of Financial Instruments The Company's financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, customer deposits, accounts payable, and restricted cash, and are reflected in the consolidated financial statements at carrying value. Carrying value approximates fair value for these items due to their short-term nature. Included in cash and cash equivalents in the accompanying condensed consolidated balance sheets are money market funds. These are valued at quoted market prices in active markets. Subsequent to the issuance of Fiscal Year 2023 financial statements, the Company determined that the money market funds balance as of July 31, 2023 in the above table, was understated by $54.2 million. The Company corrected this immaterial error in the table above as of July 31, 2023. This disclosure change did not have any impact to amounts recognized in the condensed consolidated balance sheets. Following is a summary of changes in financial assets and liabilities measured using Level 3 inputs: (in thousands) SPHG Note (a) Convertible Loan Note Investment (a) Balance as of July 31, 2023 (Successor) $ 12,461  $ —  Purchases —  1,227  Change in fair value 442  (1,227) Balance as of April 30, 2024 (Successor) $ 12,903  $ —  (a) Unrealized losses are recorded in Other (losses) gains, net within the condensed consolidated statements of operations. Valuation Techniques Prior to the date of the Exchange Transaction, the Company did not measure the fair value of the SPHG Note on a recurring basis, as the assumption was that the carrying value of the liability component of the SPHG Note approximated fair value because the stated interest rate of this debt was consistent with current market rates. In conjunction with the application of pushdown accounting, the Company now measures the fair value of the SPHG Note on a recurring basis. Refer to Note 10 - "Debt" for further details. The Company estimates the value of the SPHG Note using a Binomial Lattice Model. Key inputs in the valuation include the trading price and volatility of Steel Connect's common stock, the risk-free rate of return, as well as the dividend rate, conversion price, and maturity date. The Company recognized $0.4 million in unrealized losses in Other (losses) gains, net within the condensed consolidated statements of operations for the nine months ended April 30, 2024 as a result of the fair value measurement performed. The Company determined that there have been no changes to the fair value of the SPHG Note from the prior quarter, given that the fair value remeasurement performed as of January 31, 2024 yielded $12.9 million, which equates to the principal balance remaining on the SPHG Note, and the SPHG Note is due on September 1, 2024. As discussed in Note 7 - "Investments", the Company elected the fair value option to account for their convertible loan note investment. As of April 30, 2024, the Company believes the fair value of the investment is zero. As such, the Company recorded a loss of $1.2 million to the condensed consolidated statement of operations for the three and nine months ended April 30, 2024. There were no unrealized gains or losses recorded to the condensed consolidated statement of operations for the Predecessor Period, as the convertible loan note investment was a new investment in October 2023.

v3.24.1.1.u2

SUPPLEMENTAL CASH FLOW INFORMATION	9 Months Ended
	Apr. 30, 2024
Condensed Financial Information Disclosure [Abstract]
SUPPLEMENTAL CASH FLOW INFORMATION	SUPPLEMENTAL CASH FLOW INFORMATION A summary of supplemental cash flow information for the nine months ended April 30, 2024 and 2023 is presented in the following table: Successor Predecessor Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 (in thousands) Cash paid during the period for: Interest $ 1,009  $ 1,145  Income taxes $ 215  $ 35

v3.24.1.1.u2

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Pay vs Performance Disclosure
Net loss	$ 71,660	$ 3,029	$ 81,442	$ 7,460

v3.24.1.1.u2

Insider Trading Arrangements	3 Months Ended
	Apr. 30, 2024
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

v3.24.1.1.u2

RECENT ACCOUNTING PRONOUNCEMENTS (Policies)	9 Months Ended
	Apr. 30, 2024
Accounting Policies [Abstract]
Basis of Accounting	The accompanying condensed consolidated financial statements have been prepared by the Company in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of a normal recurring nature) considered necessary for fair presentation have been included. These unaudited condensed consolidated financial statements should be read in conjunction with the audited financial statements and related notes for the year ended July 31, 2023 (Fiscal Year 2023), which are contained in the Company's Fiscal Year 2023 Form 10-K filed on November 8, 2023, as amended on November 28, 2023. Certain prior year amounts have been reclassified to conform to current year presentation. The results for the nine months ended April 30, 2024 are not necessarily indicative of the results to be expected for the full fiscal year. The year-end condensed consolidated balance sheet data was derived from audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP.
Investments	Investments Long-term investments consist of debt and equity securities. The Company determines the appropriate classifications of its investments at the acquisition date and re-evaluates the classifications at each balance sheet date. Equity securities that do not result in consolidation and are not accounted for under the equity method are measured at fair value, with any changes recognized in Other (losses) gains, net in the consolidated statements of operations in accordance with Accounting Standards Codification ("ASC") Topic 321, Investments - Equity Securities. The Company uses quoted market prices to determine the fair value of equity securities with readily determinable fair value. Available-for-sale debt securities are reported at fair value, with unrealized gains and losses recognized in accumulated other comprehensive income or loss as a separate component of the Company's stockholders' equity in accordance with ASC Topic 320, Investments - Debt Securities. To the extent that debt securities meet the definition of a hybrid security under ASC 815, Derivatives and Hedging, the Company may elect the fair value option under ASC 825, Financial Instruments to measure the entire hybrid instrument, with changes in fair value recorded in the Company's consolidated statements of operations.
Accounting Standards Issued and Not Yet Implemented	Accounting Standards Issued and Not Yet Implemented In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which is intended to enhance the transparency, decision usefulness and effectiveness of income tax disclosures. The new guidance requires disaggregated information about the effective tax rate reconciliation and additional information on taxes paid that meet a quantitative threshold. The new guidance is effective for annual reporting periods beginning after December 15, 2024, with early adoption and retrospective application permitted. This guidance will be effective for the Company beginning in the fourth quarter in the fiscal year ending July 31, 2026. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statement disclosures; however, adoption is not expected to impact its consolidated balance sheets or statement of operations. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures, which is intended to improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses, allowing financial statement users to better understand the components of a segment's profit or loss to assess potential future cash flows for each reportable segment and the entity as a whole. The new guidance requires a public entity to disclose significant expenses and other segment items that are regularly reported to the chief operating decision maker ("CODM") and the nature of segment expense information used to manage operations. Additionally, it requires a public entity to disclose the title and position of the CODM. The ASU does not change how a public entity identifies its operating segments, aggregates them, or applies the quantitative thresholds to determine its reportable segments. The new guidance is effective for annual reporting periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. This guidance will be effective for the Company beginning in the fourth quarter in the fiscal year ending July 31, 2025. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statement disclosures; however, adoption is not expected to impact its consolidated balance sheets or statements of operations. In August 2020, the FASB issued ASU 2020-06, Debt-Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging-Contracts in Entity's Own Equity (Subtopic 815-40). The amendment in this update simplifies the accounting for convertible instruments by reducing the number of accounting models available for convertible debt instruments and convertible preferred stock. This update also amends the guidance for the derivatives scope exception for contracts in an entity's own equity to reduce form-over-substance-based accounting conclusions and requires the application of the if-converted method for calculating diluted earnings per share. The update also requires entities to provide expanded disclosures about the terms and features of convertible instruments, how the instruments have been reported in the entity's financial statements and information about events, conditions and circumstances that can affect how to assess the amount or timing of an entity's future cash flows related to those instruments. The guidance is effective beginning in the first quarter of our fiscal year ending July 31, 2025, with early adoption permitted. The Company is currently evaluating this guidance to determine the impact it may have on its consolidated financial statements; however, adoption is not expected to impact its consolidated balance sheets or statements of operations. Other new pronouncements issued but not effective until after April 30, 2024 are not expected to have a material impact on our financial condition, results of operations or liquidity
Fair Value of Financial Instruments	ASC 820, Fair Value Measurement, provides that fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants based on the highest and best use of the asset or liability. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. ASC 820 requires the Company to use valuation techniques to measure fair value that maximize the use of observable inputs and minimize the use of unobservable inputs. These inputs are prioritized as follows: Level 1: Observable inputs such as quoted prices for identical assets or liabilities in active markets Level 2: Other inputs that are observable directly or indirectly, such as quoted prices for similar assets or liabilities or market-corroborated inputs Level 3: Unobservable inputs for which there is little or no market data and which require the Company to develop its own assumptions about how market participants would price the assets or liabilities When available, quoted prices are used to determine fair value. When quoted prices in active markets are available, investments are classified within Level 1 of the fair value hierarchy. When quoted prices in active markets are not available, fair values are determined using pricing models, and the inputs to those pricing models are based on observable market inputs. The inputs to the pricing models are typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others. Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis The Company reviews the carrying amounts of these assets whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. An impairment loss is recognized when the carrying amount of the asset group or reporting unit is not recoverable and exceeds its fair value. The Company estimates the fair values of assets subject to impairment based on the Company's own judgments about the assumptions that market participants would use in pricing the assets and on observable market data, when available. Fair Value of Financial Instruments The Company's financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, customer deposits, accounts payable, and restricted cash, and are reflected in the consolidated financial statements at carrying value. Carrying value approximates fair value for these items due to their short-term nature. Included in cash and cash equivalents in the accompanying condensed consolidated balance sheets are money market funds. These are valued at quoted market prices in active markets.

v3.24.1.1.u2

EXCHANGE TRANSACTION (Tables)	9 Months Ended
	Apr. 30, 2024
Related Party Transactions [Abstract]
Schedule of Exchange Transaction Consideration	The following table summarizes the total Exchange Transaction consideration: (in thousands) May 1, 2023 Fair value of Aerojet common stock $ 202,733  Fair value of previously held interest in Steel Connect and noncontrolling interest 111,816  Less: cash acquired from Steel Connect (65,896) Total estimated consideration, less cash acquired $ 248,653
Summary of Preliminary Fair Value of Assets Acquired and Liabilities Assumed	The following represents the final calculation of goodwill and fair value amounts recognized. The Company notes that there were no measurement period adjustments made in the current period that would result in an updated preliminary fair value allocation. (in thousands) May 1, 2023 Assets Accounts receivable, trade $ 36,900  Inventories, net 6,900 Prepaid expenses and other current assets 4,957 Other intangible assets 35,500  Other assets 3,900  Property and equipment, net 3,400  Operating lease right-of-use assets 29,250  Investments 202,733  Estimated fair value of total assets acquired by Steel Holdings 323,540  Liabilities Accounts payable 26,300  Accrued expenses 29,100  Current lease obligations 7,994  Other current liabilities 7,236  Long-term lease obligations 21,300  Other long-term liabilities 5,742  Estimated fair value of total liabilities assumed by Steel Holdings 97,672  Fair value of identifiable net assets 225,868 Goodwill attributable to Steel Connect $ 22,785
Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Exchange Transaction	The estimated fair value and estimated remaining useful lives of identifiable intangible assets as of the Exchange Transaction date were as follows: (in thousands) Useful Life (Years) Amount Customer relationships 7 $ 25,000  Trade name Indefinite 10,500  Estimated fair value of identifiable intangible assets $ 35,500

v3.24.1.1.u2

GOODWILL AND OTHER INTANGIBLE ASSETS, NET (Tables)	9 Months Ended
	Apr. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Goodwill	A reconciliation of the change in the carrying amount of goodwill by reportable segment is as follows: (in thousands) Supply Chain Balance at July 31, 2023 (Successor) Gross goodwill $ 22,785  Accumulated impairments —  Net goodwill $ 22,785  Balance at April 30, 2024 (Successor) Gross goodwill $ 22,785  Accumulated impairments —  Net goodwill $ 22,785
Schedule of Indefinite-Lived Intangible Assets	A summary of Other intangible assets, net is as follows: Successor April 30, 2024 July 31, 2023 (in thousands) Gross Carrying Amount Accumulated Amortization Net Gross Carrying Amount Accumulated Amortization Net Customer relationships $ 25,000  $ 3,571  $ 21,429  $ 25,000  $ 911  $ 24,089  Trade name 10,500  —  10,500  10,500  —  10,500  Total $ 35,500  $ 3,571  $ 31,929  $ 35,500  $ 911  $ 34,589
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense	Based on gross carrying amounts at April 30, 2024, the Company's projection of amortization expense for identifiable intangible assets for the remainder of the fiscal year ending July 31, 2024, and fiscal years 2025 through 2028 and thereafter is presented in the table below: Fiscal Year Ending July 31, (in thousands) 2024 2025 2026 2027 2028 Thereafter Projected amortization expense $ 893  $ 3,571  $ 3,571  $ 3,571  $ 3,571  $ 6,252

v3.24.1.1.u2

INVENTORIES, NET (Tables)	9 Months Ended
	Apr. 30, 2024
Inventory Disclosure [Abstract]
Schedule of Inventories, Net	The table below presents the components of Inventories, net: Successor April 30, 2024 July 31, 2023 (in thousands) Raw materials $ 6,271  $ 4,805  Work-in-process 258  239  Finished goods 945  3,525  $ 7,474  $ 8,569

v3.24.1.1.u2

INVESTMENTS (Tables)	9 Months Ended
	Apr. 30, 2024
Investments, Debt and Equity Securities [Abstract]
Investment	The following table summarizes the Company's investments as of April 30, 2024. There were no investments as of July 31, 2023. Successor (in thousands) April 30, 2024 Convertible loan note investment(a) $ —  Other investments(b) 14,293  Total $ 14,293  (a)    The Company entered into a new convertible loan note on October 13, 2023, which matures on March 31, 2025. The Company paid 1.0 million GBP (approximately $1.2 million) to subscribe for an amount of £1.0 million (the "loan principal") of 11.0% 2025 unsecured convertible loan notes issued by the investee (the "CLN Instrument Agreement"). Contemporaneous with the execution of the CLN Instrument Agreement, the Company executed the Equity Warrant Instrument Agreement (“Warrant Agreement”), which provides the Company with the option to convert the outstanding balance into equity shares of the investee at any time before repayment of the outstanding loan principal balance. The Company’s £1.0 million investment in the £20.0 million GBP 11.0% unsecured convertible loan notes provides it with an approximate 5.0% ownership interest on an if-converted basis. Changes in fair value will be recorded in the Company's condensed consolidated statements of operations as the Company elected the fair value option under ASC 825 to account for this investment. Changes in fair value are recorded in the Company's condensed consolidated statements of operations as the Company elected the fair value option under ASC 825 to account for this investment. In April 2024, the Company became aware that the investee had halted its operations while it undergoes a restructuring process. As a result, the Company determined that the fair value of the investment was zero. The Company recorded a loss of $1.2 million to Other (losses) gains, net on the condensed consolidated statements of operations during the three and nine months ended April 30, 2024, which was the fair value of the investment as of January 31, 2024. (b)    The balance consists of multiple common stock investments in public companies which are measured at fair value.
Unrealized Gain (Loss) on Investments	The amount of unrealized net losses for the three and nine months ended April 30, 2024 that relate to equity securities still held as of April 30, 2024 are as follows: Successor Three months ended April 30, Nine months ended April 30, (in thousands) 2024 2024 Net losses recognized during the period on equity securities $ (872) $ (276) Less: Net (losses) gains recognized during the period on equity securities sold during the period (21) 372  Unrealized net losses recognized during the period on equity securities still held at the end of the period $ (851) $ (648)

v3.24.1.1.u2

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)	9 Months Ended
	Apr. 30, 2024
Payables and Accruals [Abstract]
Components of Accrued Expenses	The following tables reflect the components of "Accrued expenses" and "Other current liabilities". Successor April 30, 2024 July 31, 2023 Accrued Expenses (in thousands) Accrued compensation $ 6,311  $ 6,891  Accrued audit, tax and legal 4,027  5,696  Accrued price concessions 2,587  2,981  Accrued taxes 1,796  2,811  Accrued occupancy costs 1,611  1,412  Accrued IT costs 648  831  Accrued travel 535  —  Accrued freight 447  502  Accrued contract labor 372  517  Accrued other 4,723  5,133  Total accrued expenses $ 23,057  $ 26,774
Components of Other Current Liabilities	Successor April 30, 2024 July 31, 2023 Other Current Liabilities (in thousands) Deferred revenue - current 2,762  2,574  Other 1,571  1,970  Total other current liabilities $ 4,333  $ 4,544

v3.24.1.1.u2

LEASES (Tables)	9 Months Ended
	Apr. 30, 2024
Leases [Abstract]
Lease Cost	The table below presents the components of the Company's lease expense: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, 2024 Nine Months Ended April 30, 2023 2024 2023 2024 2023 (in thousands) Operating lease cost $ 2,672  $ 2,636  $ 7,830  $ 7,538  Short-term lease expense 337  394  1,215  1,269  Variable lease cost —  —  —  7  Sublease income $ (61) $ (222) $ (352) $ (786) Total lease expense $ 2,948  $ 2,808  $ 8,693  $ 8,028  Supplemental cash flow information related to the Company's leases was as follows: Successor Predecessor Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 (in thousands) Cash paid for amounts included in measurement of lease liabilities: Operating cash flows from operating leases $ 7,641  $ 7,224  Financing cash flows from finance leases $ —  $ 38

v3.24.1.1.u2

DEBT (Tables)	9 Months Ended
	Apr. 30, 2024
Debt Disclosure [Abstract]
Summary of Components of Debt and Reconciliation to Carrying Amount	The components of debt are presented in the table below: Successor April 30, 2024 July 31, 2023 (in thousands) Unsecured 7.50% Convertible Senior Note due September 1, 2024 $ 12,903  $ 12,461  Credit Facility Umpqua Revolver —  —  Total debt, net $ 12,903  $ 12,461
Net carrying value of SPG note	Below is a reconciliation of interest expense related to the SPHG Note to total interest expense: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Interest expense related to contractual interest coupon on the SPHG Note $ 243  $ 271  $ 739  $ 844  Interest expense related to accretion of the discount on the SPHG Note(a) —  632  —  1,688  Interest expense related to revolving credit facilities (see below) —  11  —  36  Other —  —  —  20  Total interest expense $ 243  $ 914  $ 739  $ 2,588  (a) Prior to the date of the Exchange Transaction, the discount on the SPHG Note was accreted using the effective interest rate method. The effective interest rate on the SPHG Note was 27.8% prior to the SPHG Note Amendment, and was 23.0% subsequent to the SPHG Note Amendment.

v3.24.1.1.u2

REVENUE RECOGNITION (Tables)	9 Months Ended
	Apr. 30, 2024
Revenue from Contract with Customer [Abstract]
Summary of Reconciliation of the Disaggregated Revenue	The following table presents the Company's revenues from contracts with customers disaggregated by major good or service line and timing of revenue recognition. The table also includes a reconciliation of the disaggregated revenue with the reportable segments. Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Major Goods/Service Lines Supply chain management services $ 43,456  $ 45,826  $ 127,157  $ 147,185  Other 399  316  1,083  1,098  $ 43,855  $ 46,142  $ 128,240  $ 148,283  Timing of Revenue Recognition Services transferred over time $ 43,855  $ 46,142  $ 128,240  $ 148,283  $ 43,855  $ 46,142  $ 128,240  $ 148,283
Summary of Changes in Deferred Revenue	The table below presents information for the Company's contract balances: Successor Predecessor April 30, 2024 July 31, 2023 August 1, 2022 (in thousands) Accounts receivable, trade, net $ 31,873  $ 28,616  $ 40,083  Contract assets 283  439  369  Deferred revenue - current $ 2,762  $ 2,574  $ 2,705  Deferred revenue - long-term 68  144  134  Total deferred revenue $ 2,830  $ 2,718  $ 2,839  Remaining Performance Obligations Remaining performance obligations are comprised of deferred revenue. Changes in deferred revenue during the nine months ended April 30, 2024 and April 30, 2023, were as follows: Successor Predecessor Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 (in thousands) Balance at beginning of period $ 2,718  $ 2,839  Deferral of revenue 1,456  1,595  Recognition of deferred amounts upon satisfaction of performance obligation (1,344) (1,361) Balance at end of period $ 2,830  $ 3,073

v3.24.1.1.u2

EARNINGS PER SHARE (Tables)	9 Months Ended
	Apr. 30, 2024
Earnings Per Share [Abstract]
Reconciliation of Net Income (Loss) Per Share	The following table reconciles net earnings per share for the three and nine months ended April 30, 2024 and 2023: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands, except per share data) Reconciliation of net income to net income attributable to common stockholders after assumed conversions: Net income $ 71,660  $ 3,029  $ 81,442  $ 7,460  Less: Preferred dividends on Series C redeemable preferred stock (531) (519) (1,604) (1,593) Net income available to common stockholders 71,129  2,510  79,838  5,867  Less: Undistributed earnings allocated to participating securities (54,125) —  (60,780) —  Net income attributable to common stockholders $ 17,004  $ 2,510  $ 19,058  $ 5,867  Effect of dilutive securities: Interest and debt amortization costs on convertible debt 243  —  739  —  Dividends on Series C preferred stock 531  519  1,604  1,593  Undistributed earnings allocated to Series E preferred stock 54,125  —  60,780  —  Net income attributable to common stockholders - assuming dilution $ 71,903  $ 3,029  $ 82,181  $ 7,460  Net income per common share - basic $ 2.73  $ 0.39  $ 3.07  $ 0.91  Net income per common share - diluted $ 2.51  $ 0.36  $ 2.88  $ 0.89  Weighted average common shares outstanding - basic 6,224  6,461  6,211  6,449  Effect of dilutive securities: Common stock equivalents - Restricted stock and restricted stock shares 68  57  62  55  Common stock equivalents - Convertible debt 584  —  584  —  Common stock equivalents - Series C Preferred stock 1,913  1,913  1,913  1,913  Common stock equivalents - Series E Preferred stock 19,810  —  19,810  —  Weighted average common shares outstanding - diluted 28,599  8,431  28,580  8,417

v3.24.1.1.u2

COMPREHENSIVE (LOSS) INCOME (Tables)	9 Months Ended
	Apr. 30, 2024
Equity [Abstract]
Accumulated Other Comprehensive Income, Net of Income Taxes	Accumulated other comprehensive items consist of the following: Foreign Currency Items Pension Items Total (in thousands) Accumulated other comprehensive (loss) income as of July 31, 2023 (Successor) $ (623) $ 36  $ (587) Foreign currency translation adjustment (341) —  (341) Net current-period other comprehensive loss (341) —  (341) Accumulated other comprehensive (loss) income as of April 30, 2024 (Successor) $ (964) $ 36  $ (928) Foreign Currency Items Pension Items Total (in thousands) Accumulated other comprehensive income (loss) as of July 31, 2022 (Predecessor) $ 6,063  $ (1,923) $ 4,140  Foreign currency translation adjustment 999  —  999  Pension liability adjustments, net of tax —  (1,078) (1,078) Net current-period other comprehensive income (loss) 999  (1,078) (79) Accumulated other comprehensive income (loss) as of April 30, 2023 (Predecessor) $ 7,062  $ (3,001) $ 4,061

v3.24.1.1.u2

SEGMENT INFORMATION (Tables)	9 Months Ended
	Apr. 30, 2024
Segment Reporting [Abstract]
Summarized Financial Information of Continuing Operations by Operating Segment and Corporate-Level Activity	Summarized financial information of the Company's continuing operations by operating segment is as follows: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Net revenue: Supply Chain $ 43,855  $ 46,142  $ 128,240  $ 148,283  Total segment net revenue $ 43,855  $ 46,142  $ 128,240  $ 148,283  Operating income: Supply Chain $ 4,448  $ 5,249  $ 10,187  $ 16,488  Total segment operating income 4,448  5,249  10,187  16,488  Corporate-level activity (1,468) (4,944) (3,680) (9,699) Total operating income 2,980  305  6,507  6,789  Total other income, net 880  3,575  8,000  2,301  Income before income taxes $ 3,860  $ 3,880  $ 14,507  $ 9,090  Summarized financial information of the Company's capital expenditures and depreciation expense for the Supply Chain reportable segment is as follows: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Capital expenditures $ 1,211  $ 445  $ 2,911  $ 1,311  Depreciation expense $ 439  $ 503  $ 1,324  $ 1,427
Total Assets of Continuing Operations	Successor April 30, 2024 July 31, 2023 (in thousands) Total assets: Supply Chain $ 160,565  $ 146,614  Corporate 324,897  264,567  Total assets $ 485,462  $ 411,181
Summarized Financial Information of Net Revenue from External Customers by Group of Services	Summarized financial information of the Company's net revenue by geographic location is as follows: Successor Predecessor Successor Predecessor Three Months Ended April 30, Three Months Ended April 30, Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 2024 2023 (in thousands) Mainland China $ 15,822  $ 13,852  $ 45,577  $ 48,049  United States 9,776  12,917  31,593  38,262  Netherlands 5,035  4,872  16,121  15,149  Singapore 4,413  4,705  12,332  14,940  Czech Republic 4,241  6,202  9,436  19,497  Other 4,568  3,594  13,181  12,386  Total consolidated net revenue $ 43,855  $ 46,142  $ 128,240  $ 148,283

v3.24.1.1.u2

FAIR VALUE MEASUREMENTS (Tables)	9 Months Ended
	Apr. 30, 2024
Fair Value Disclosures [Abstract]
Financial Assets Measured at Fair Value on Recurring Basis and Classified by Fair Value Hierarchy	The following tables present the Company's financial assets and liabilities measured at fair value on a recurring basis as of April 30, 2024 and July 31, 2023, classified by fair value hierarchy: Successor Fair Value Measurements at Reporting Date Using (in thousands) April 30, 2024 Level 1 Level 2 Level 3 Assets: Money market funds $ 254,118  $ 254,118  $ —  $ —  Convertible loan note investment $ —  $ —  $ —  $ —  Other investments $ 14,293  $ 14,293  $ —  $ —  Liabilities: SPHG Note $ 12,903  $ —  $ —  $ 12,903  Successor Fair Value Measurements at Reporting Date Using (in thousands) July 31, 2023 Level 1 Level 2 Level 3 Assets: Money market funds $ 85,269  $ 85,269  $ —  $ —  Liabilities: SPHG Note $ 12,461  $ —  $ —  $ 12,461
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation	Following is a summary of changes in financial assets and liabilities measured using Level 3 inputs: (in thousands) SPHG Note (a) Convertible Loan Note Investment (a) Balance as of July 31, 2023 (Successor) $ 12,461  $ —  Purchases —  1,227  Change in fair value 442  (1,227) Balance as of April 30, 2024 (Successor) $ 12,903  $ —  (a) Unrealized losses are recorded in Other (losses) gains, net within the condensed consolidated statements of operations.

v3.24.1.1.u2

SUPPLEMENTAL CASH FLOW INFORMATION (Tables)	9 Months Ended
	Apr. 30, 2024
Condensed Financial Information Disclosure [Abstract]
Schedule of Cash Flow, Supplemental Disclosures	A summary of supplemental cash flow information for the nine months ended April 30, 2024 and 2023 is presented in the following table: Successor Predecessor Nine Months Ended April 30, Nine Months Ended April 30, 2024 2023 (in thousands) Cash paid during the period for: Interest $ 1,009  $ 1,145  Income taxes $ 215  $ 35

v3.24.1.1.u2

NATURE OF OPERATIONS (Details) - shares	Apr. 30, 2024	Jul. 31, 2023	Apr. 30, 2023
Nature Of Operations [Line Items]
Preferred stock, shares issued (in shares)	0	0
Exchange Transaction Agreement | Steel Partners Group | Series E Preferred Stock
Nature Of Operations [Line Items]
Preferred stock, shares issued (in shares)			3,500,000

v3.24.1.1.u2

BASIS OF PRESENTATION (Details) - Common Stock	Jun. 06, 2023
Significant Of Accounting Policies [Line Items]
Reverse stock split, conversion ratio	0.00029
Stockholders' equity note, forward stock split, conversion ratio	375

v3.24.1.1.u2

EXCHANGE TRANSACTION - Additional Information (Details) - $ / shares	Apr. 30, 2024	Jul. 31, 2023	Jun. 06, 2023	May 01, 2023	Apr. 30, 2023	Feb. 28, 2019
Related Party Transaction [Line Items]
Common stock, par value (in usd per share)	$ 0.01	$ 0.01
Preferred stock, shares issued (in shares)	0	0
Equity ownership, excluding consolidated entity and equity method investee, percentage				84.00%
Ownership percentage, noncontrolling interest, threshold percentage				16.00%
Ownership percentage, prior approval of equity securities, threshold percentage					49.60%
SPHG Holdings | Convertible note investment
Related Party Transaction [Line Items]
Debt instrument, stated interest rate				7.50%		7.50%
Common Stock
Related Party Transaction [Line Items]
Common stock, par value (in usd per share)			$ 0.01
Exchange Transaction Agreement | Steel Partners | Aerojet Share | Exchanging Parties
Related Party Transaction [Line Items]
Common stock, shares exchanged (in shares)				3,597,744
Common stock, par value (in usd per share)				$ 0.10
Exchange Transaction Agreement | Steel Partners | Series E Preferred Stock
Related Party Transaction [Line Items]
Preferred stock, shares issued (in shares)				3,500,000

v3.24.1.1.u2

EXCHANGE TRANSACTION - Schedule of Exchange Transaction Consideration (Details) - SPLP $ in Thousands	May 01, 2023 USD ($)
Related Party Transaction [Line Items]
Less: cash acquired from Steel Connect	$ (65,896)
Total estimated consideration, less cash acquired	248,653
Aerojet Share
Related Party Transaction [Line Items]
Business combination, consideration transferred, equity interests issued and issuable	202,733
Common Stock
Related Party Transaction [Line Items]
Business combination, consideration transferred, equity interests issued and issuable	$ 111,816

v3.24.1.1.u2

EXCHANGE TRANSACTION - Summary of Preliminary Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023	May 01, 2023
Related Party Transaction [Line Items]
Goodwill	$ 22,785	$ 22,785
SPLP
Related Party Transaction [Line Items]
Accounts receivable, trade			$ 36,900
Inventories, net			6,900
Prepaid expenses and other current assets			4,957
Other intangible assets			35,500
Other assets			3,900
Property and equipment, net			3,400
Operating lease right-of-use assets			29,250
Investments			202,733
Estimated fair value of total assets acquired by Steel Holdings			323,540
Accounts payable			26,300
Accrued expenses			29,100
Current lease obligations			7,994
Other current liabilities			7,236
Long-term lease obligations			21,300
Other long-term liabilities			5,742
Estimated fair value of total liabilities assumed by Steel Holdings			97,672
Fair value of identifiable net assets			225,868
Goodwill			$ 22,785

v3.24.1.1.u2

EXCHANGE TRANSACTION - Finite-Lived and Indefinite-Lived Intangible Assets Acquired as Part of Exchange Transaction (Details) - SPLP $ in Thousands	May 01, 2023 USD ($)
Related Party Transaction [Line Items]
Estimated fair value of identifiable intangible assets	$ 35,500
Trade name
Related Party Transaction [Line Items]
Trade name	10,500
Customer relationships
Related Party Transaction [Line Items]
Customer relationships	$ 25,000
Acquired finite-lived intangible assets, weighted average useful life	7 years

v3.24.1.1.u2

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Schedule of Goodwill (Details) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023
Goodwill [Line Items]
Net goodwill	$ 22,785	$ 22,785
Supply Chain
Goodwill [Line Items]
Gross goodwill	22,785	22,785
Accumulated impairments	0	0
Net goodwill	$ 22,785	$ 22,785

v3.24.1.1.u2

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Schedule of Indefinite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023
Goodwill [Line Items]
Intangible assets, gross (excluding goodwill)	$ 35,500	$ 35,500
Accumulated Amortization	3,571	911
Total	31,929	34,589
Trade name
Goodwill [Line Items]
Indefinite-lived intangible assets (excluding goodwill)	10,500	10,500
Customer relationships
Goodwill [Line Items]
Finite-lived intangible assets, gross	25,000	25,000
Accumulated Amortization	3,571	911
Net	$ 21,429	$ 24,089

v3.24.1.1.u2

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Apr. 30, 2024	Apr. 30, 2024	Apr. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization of finite-lived intangible assets	$ 900	$ 2,661	$ 0

v3.24.1.1.u2

GOODWILL AND OTHER INTANGIBLE ASSETS, NET - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Thousands	Apr. 30, 2024 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2024	$ 893
2025	3,571
2026	3,571
2027	3,571
2028	3,571
Thereafter	$ 6,252

v3.24.1.1.u2

INVENTORIES, NET - Components of Inventories (Details) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023
Inventory Disclosure [Abstract]
Raw materials	$ 6,271	$ 4,805
Work-in-process	258	239
Finished goods	945	3,525
Inventories, net	$ 7,474	$ 8,569

v3.24.1.1.u2

INVESTMENTS - Narrative (Details) - USD ($)	Apr. 30, 2024	Jul. 31, 2023
Investments, Debt and Equity Securities [Abstract]
Investments	$ 14,293,000	$ 0

v3.24.1.1.u2

INVESTMENTS - Schedule of Investment (Details) £ in Millions		3 Months Ended	9 Months Ended
	Oct. 13, 2023 GBP (£)	Apr. 30, 2024 USD ($)	Apr. 30, 2024 USD ($)	Oct. 13, 2023 USD ($)	Oct. 13, 2023 GBP (£)	Jul. 31, 2023 USD ($)
Investments, Debt and Equity Securities [Abstract]
Convertible loan note investment		$ 0	$ 0	$ 1,200,000	£ 1.0
Other investments		14,293,000	14,293,000
Investments		14,293,000	14,293,000			$ 0
Payments to acquire debt securities, available-for-sale | £	£ 1.0
Debt securities, available-for-sale, interest rate, stated percentage				11.00%	11.00%
Debt securities, available-for-sale, loan principal | £					£ 20.0
Debt securities, available-for-sale, ownership interest percentage				5.00%	5.00%
Debt securities, available-for-sale, realized loss		$ 1,200,000	$ 1,200,000

v3.24.1.1.u2

INVESTMENTS - Schedule of Unrealized Gain (Loss) on Investments (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Apr. 30, 2024	Apr. 30, 2024
Investments, Debt and Equity Securities [Abstract]
Net losses recognized during the period on equity securities	$ (872)	$ (276)
Less: Net (losses) gains recognized during the period on equity securities sold during the period	(21)	372
Unrealized net losses recognized during the period on equity securities still held at the end of the period	$ (851)	$ (648)

v3.24.1.1.u2

ACCRUED EXPENSES AND OTHER LIABILITIES - Components of Accrued Expenses (Detail) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023
Payables and Accruals [Abstract]
Accrued compensation	$ 6,311	$ 6,891
Accrued audit, tax and legal	4,027	5,696
Accrued price concessions	2,587	2,981
Accrued taxes	1,796	2,811
Accrued occupancy costs	1,611	1,412
Accrued IT costs	648	831
Accrued travel	535	0
Accrued freight	447	502
Accrued contract labor	372	517
Accrued other	4,723	5,133
Total accrued expenses	$ 23,057	$ 26,774

v3.24.1.1.u2

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES - Components of Other Current Liabilities (Details) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023	Aug. 01, 2022
Payables and Accruals [Abstract]
Deferred revenue - current	$ 2,762	$ 2,574	$ 2,705
Other	1,571	1,970
Total other current liabilities	$ 4,333	$ 4,544

v3.24.1.1.u2

LEASES - Lease Costs (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Lease, Cost [Abstract]
Operating lease cost	$ 2,672	$ 2,636	$ 7,830	$ 7,538
Short-term lease expense	337	394	1,215	1,269
Variable lease cost	0	0	0	7
Sublease income	(61)	(222)	(352)	(786)
Total lease expense	$ 2,948	$ 2,808	$ 8,693	$ 8,028

v3.24.1.1.u2

LEASES - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023
Cash paid for amounts included in measurement of lease liabilities:
Operating cash flows from operating leases	$ 7,641	$ 7,224
Financing cash flows from finance leases	$ 0	$ 38

v3.24.1.1.u2

DEBT - Summary of Components of Debt and Reconciliation to Carrying Amount (Details) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023	May 01, 2023	Feb. 28, 2019
Line of Credit Facility [Line Items]
Total debt, net	$ 12,903	$ 12,461
Convertible note investment
Line of Credit Facility [Line Items]
Principal amount of long term debt	12,903	12,461
Convertible note investment | SPHG Holdings
Line of Credit Facility [Line Items]
Debt instrument, stated interest rate			7.50%	7.50%
Umpqua Revolver
Line of Credit Facility [Line Items]
Revolving credit facility	$ 0	$ 0

v3.24.1.1.u2

DEBT - Additional Information (Details) - USD ($) $ in Millions	9 Months Ended
	Apr. 30, 2023	Apr. 30, 2024	Jul. 31, 2023	May 01, 2023	Feb. 28, 2019
Umpqua Revolver
Debt Instrument [Line Items]
Line of credit facility, maximum credit commitment		$ 12.5
Line of credit facility, sublimit borrowing capacity		5.0
Revolving credit facility		0.6
MidCap Credit Facility
Debt Instrument [Line Items]
Credit facility, readily available borrowing capacity		11.9
Convertible note investment | SPHG Holdings
Debt Instrument [Line Items]
Debt instrument, stated interest rate				7.50%	7.50%
Debt instrument, face amount		$ 12.9	$ 12.9		$ 14.9
Debt instrument, repaid, principal	$ 2.0

v3.24.1.1.u2

DEBT - Summary of Interest Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023	Jan. 31, 2023
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	$ 243	$ 914	$ 739	$ 2,588
Debt instrument, interest rate, effective percentage	23.00%		23.00%		27.80%
Umpqua Revolver
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	$ 0	11	$ 0	36
Other
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	0	0	0	20
SPHG Holdings | Interest expense related to contractual interest coupon on the SPHG Note
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	243	271	739	844
SPHG Holdings | Interest expense related to accretion of the discount on the SPHG Note(a)
Interest Expense, Debt [Line Items]
Debt instrument, interest expense	$ 0	$ 632	$ 0	$ 1,688

v3.24.1.1.u2

CONTINGENCIES - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands	Apr. 17, 2024	Feb. 18, 2022	Aug. 13, 2021	Dec. 15, 2017	Apr. 08, 2024
Reith v. Lichtenstein
Contingencies [Line Items]
Cash paid to plaintiff			$ 2,800
Legal fees		$ 2,050
Gain contingency, unrecorded amount					$ 6,000
Reith v. Lichtenstein | Director | Restricted Stock
Contingencies [Line Items]
Number of shares surrendered			353,571
Reith v. Lichtenstein | Director | Restricted Stock | Warren Lichtenstein
Contingencies [Line Items]
Number of vested shares surrendered			196,429
Number of nonvested shares surrendered			32,143
Reith v. Lichtenstein | Director | Restricted Stock | Jack Howard
Contingencies [Line Items]
Number of vested shares surrendered			98,214
Number of nonvested shares surrendered			16,071
Reith v. Lichtenstein | Director | Restricted Stock | William Fejes
Contingencies [Line Items]
Number of vested shares surrendered			10,714
Reith v. Lichtenstein | Steel Connect, Inc.
Contingencies [Line Items]
Cash paid to plaintiff			$ 1,700
Reith v. Lichtenstein | Steel Holding
Contingencies [Line Items]
Cash paid to plaintiff			$ 1,100
Mohammad Ladjevardian v. Warren G. Lichtenstein
Contingencies [Line Items]
Stock repurchased during period, shares (in shares)	701,246
Price per share (in usd per share)	$ 9.83
Payments for legal settlements	$ 1,500
Series C convertible preferred stock | Purchase agreement | SPHG Holdings
Contingencies [Line Items]
Proceeds from issuance of preferred stock				$ 35,000

v3.24.1.1.u2

REVENUE RECOGNITION - Disaggregated Revenue (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Disaggregation of Revenue [Line Items]
Net revenue	$ 43,855	$ 46,142	$ 128,240	$ 148,283
Supply chain management services
Disaggregation of Revenue [Line Items]
Net revenue	43,456	45,826	127,157	147,185
Other
Disaggregation of Revenue [Line Items]
Net revenue	399	316	1,083	1,098
Services transferred over time | Transferred over time
Disaggregation of Revenue [Line Items]
Net revenue	$ 43,855	$ 46,142	$ 128,240	$ 148,283

v3.24.1.1.u2

REVENUE RECOGNITION - Contract Balances (Detail) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023	Apr. 30, 2023	Aug. 01, 2022	Jul. 31, 2022
Disaggregation of Revenue [Line Items]
Contract assets	$ 283	$ 439		$ 369
Deferred revenue - current	2,762	2,574		2,705
Deferred revenue - long-term	68	144		134
Total deferred revenue	2,830	2,718	$ 3,073	2,839	$ 2,839
Trade Accounts Receivable
Disaggregation of Revenue [Line Items]
Accounts receivable, trade, net	$ 31,873	$ 28,616		$ 40,083

v3.24.1.1.u2

REVENUE RECOGNITION - Summary of Changes in Deferred Revenue (Detail) - USD ($) $ in Thousands	9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023
Change in Deferred Revenue
Balance at beginning of period	$ 2,718	$ 2,839
Deferral of revenue	1,456	1,595
Recognition of deferred amounts upon satisfaction of performance obligation	(1,344)	(1,361)
Balance at end of period	$ 2,830	$ 3,073

v3.24.1.1.u2

REVENUE RECOGNITION - Performance Obligations (Details) $ in Millions	Apr. 30, 2024 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-05-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 2.8
Revenue, remaining performance obligation, expected timing of satisfaction, period	12 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2025-05-01
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligations	$ 0.1
Revenue, remaining performance obligation, expected timing of satisfaction, period

v3.24.1.1.u2

INCOME TAXES - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Apr. 30, 2024	Apr. 30, 2024	Apr. 30, 2023	Jul. 31, 2023
Operating Loss Carryforwards [Line Items]
Unrecognized tax benefits including Interest	$ 400	$ 400		$ 400
Deferred tax assets, operating loss carryforwards, subject to expiration	31,000	31,000
Deferred income tax expense (benefit)	(71,500)	(71,550)	$ 0
Liabilities for interest expense related to uncertain tax positions	100	100		$ 100
Expected unrecognized tax benefits to reverse in the next twelve months	300	300
State and Local Jurisdiction
Operating Loss Carryforwards [Line Items]
Deferred tax assets, operating loss carryforwards, subject to expiration	$ 900	$ 900

v3.24.1.1.u2

EARNINGS PER SHARE - Reconciliation of (Loss) Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Class of Stock [Line Items]
Net income	$ 71,660	$ 3,029	$ 81,442	$ 7,460
Less: Preferred dividends on Series C redeemable preferred stock	531	519	1,604	1,593
Net income available to common stockholders	71,129	2,510	79,838	5,867
Less: Undistributed earnings allocated to participating securities	(54,125)	0	(60,780)	0
Net income attributable to common stockholders	17,004	2,510	19,058	5,867
Interest and debt amortization costs on convertible debt	243	0	739	0
Dividends on Series C preferred stock	531	519	1,604	1,593
Undistributed earnings allocated to Series E preferred stock	54,125	0	60,780	0
Net income attributable to common stockholders - assuming dilution	$ 71,903	$ 3,029	$ 82,181	$ 7,460
Net income per common share - basic (in usd per share)	$ 2.73	$ 0.39	$ 3.07	$ 0.91
Net income per common share - diluted (in usd per share)	$ 2.51	$ 0.36	$ 2.88	$ 0.89
Weighted-average number of common shares outstanding - basic (in shares)	6,224	6,461	6,211	6,449
Common stock equivalents - Restricted stock and restricted stock shares (in shares)	68	57	62	55
Common stock equivalents - Convertible debt (in shares)	584	0	584	0
Weighted average common shares outstanding, diluted (in shares)	28,599	8,431	28,580	8,417
Series C Preferred Stock
Class of Stock [Line Items]
Common stock equivalents - Preferred stock (in shares)	1,913	1,913	1,913	1,913
Series E Preferred Stock
Class of Stock [Line Items]
Common stock equivalents - Preferred stock (in shares)	19,810	0	19,810	0

v3.24.1.1.u2

EARNINGS PER SHARE - Additional Information (Details) - USD ($) shares in Millions, $ in Millions	3 Months Ended	9 Months Ended
	Apr. 30, 2023	Apr. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive securities excluded from computation of earnings per share, amount	0.6	0.6
Convertible debt
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Interest expense excluded from computation of earnings, amount	$ 0.7	$ 2.3

v3.24.1.1.u2

COMPREHENSIVE (LOSS) INCOME - Accumulated Other Comprehensive Income, Net of Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	$ 77,357	$ (4,754)	$ 68,624	$ (9,206)
Foreign currency translation adjustment	(68)	(819)	(341)	999
Pension liability adjustments	0	0	0	(1,078)
Other comprehensive loss	(68)	(819)	(341)	(79)
Ending balance	148,580	(2,889)	148,580	(2,889)
Accumulated Other Comprehensive Income (Loss)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance	(860)	4,880	(587)	4,140
Ending balance	(928)	4,061	(928)	4,061
Foreign Currency Items
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance			(623)	6,063
Foreign currency translation adjustment			(341)	999
Pension liability adjustments				0
Other comprehensive loss			(341)	999
Ending balance	(964)	7,062	(964)	7,062
Pension Items
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Beginning balance			36	(1,923)
Foreign currency translation adjustment			0	0
Pension liability adjustments				(1,078)
Other comprehensive loss			0	(1,078)
Ending balance	$ 36	$ (3,001)	$ 36	$ (3,001)

v3.24.1.1.u2

COMPREHENSIVE (LOSS) INCOME - Additional Information (Details) - USD ($) $ in Millions	6 Months Ended	9 Months Ended
	Jan. 31, 2022	Apr. 30, 2024
Equity [Abstract]
Other comprehensive income (loss), defined benefit plan, settlement and curtailment gain (loss), before tax	$ 2.4
Increase of accrued pension liability		$ 1.1

v3.24.1.1.u2

SEGMENT INFORMATION - Additional Information (Details)	9 Months Ended
	Apr. 30, 2024 segment
Segment Reporting [Abstract]
Number of reportable segments	1

v3.24.1.1.u2

SEGMENT INFORMATION - Summarized Financial Information of Continuing Operations by Operating Segment and Corporate-Level Activity (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Segment Reporting Information [Line Items]
Revenue from contracts with customers	$ 43,855	$ 46,142	$ 128,240	$ 148,283
Operating income	2,980	305	6,507	6,789
Total other income, net	880	3,575	8,000	2,301
Income before income taxes	3,860	3,880	14,507	9,090
Operating segments
Segment Reporting Information [Line Items]
Operating income	4,448	5,249	10,187	16,488
Operating segments | Supply Chain
Segment Reporting Information [Line Items]
Revenue from contracts with customers	43,855	46,142	128,240	148,283
Operating income	4,448	5,249	10,187	16,488
Corporate
Segment Reporting Information [Line Items]
Operating income	$ (1,468)	$ (4,944)	$ (3,680)	$ (9,699)

v3.24.1.1.u2

SEGMENT INFORMATION - Total Assets of Continuing Operations (Details) - USD ($) $ in Thousands	Apr. 30, 2024	Jul. 31, 2023
Segment Reporting Information [Line Items]
Total assets	$ 485,462	$ 411,181
Operating segments | Supply Chain
Segment Reporting Information [Line Items]
Total assets	160,565	146,614
Corporate
Segment Reporting Information [Line Items]
Total assets	$ 324,897	$ 264,567

v3.24.1.1.u2

SEGMENT INFORMATION - Summarized Financial Information of Net Revenue from External Customers by Group of Services (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Segment Reporting Information [Line Items]
Capital expenditures			$ 2,911	$ 1,311
Depreciation			1,324	1,427
Operating segments | Supply Chain
Segment Reporting Information [Line Items]
Capital expenditures	$ 1,211	$ 445	2,911	1,311
Depreciation	$ 439	$ 503	$ 1,324	$ 1,427

v3.24.1.1.u2

SEGMENT INFORMATION - Summarized Financial Information of Net Revenue from External Customers by Group of Services (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023	Apr. 30, 2024	Apr. 30, 2023
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	$ 43,855	$ 46,142	$ 128,240	$ 148,283
Mainland China
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	15,822	13,852	45,577	48,049
United States
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	9,776	12,917	31,593	38,262
Netherlands
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	5,035	4,872	16,121	15,149
Czech Republic
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	4,241	6,202	9,436	19,497
Singapore
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	4,413	4,705	12,332	14,940
Other
Segment Reporting, Revenue Reconciling Item [Line Items]
Revenue from contracts with customers	$ 4,568	$ 3,594	$ 13,181	$ 12,386

v3.24.1.1.u2

RELATED PARTY TRANSACTIONS (Details)					3 Months Ended		9 Months Ended
	May 01, 2023 director shares	Apr. 30, 2023 USD ($) corporateEntity	Mar. 09, 2023 USD ($) $ / shares	Dec. 15, 2017 USD ($) $ / shares shares	Apr. 30, 2024 USD ($) shares	Apr. 30, 2023 USD ($) corporateEntity	Apr. 30, 2024 USD ($) shares	Apr. 30, 2023 USD ($) corporateEntity	Oct. 25, 2023 USD ($)	Jul. 31, 2023 USD ($) shares	Jun. 06, 2023 shares	Feb. 25, 2022 USD ($)	Jun. 14, 2019 USD ($)	Feb. 28, 2019 USD ($) $ / shares
Related Party Transaction [Line Items]
Preferred stock, shares issued (in shares) | shares					0		0			0
Less: Preferred dividends on Series C redeemable preferred stock					$ 531,000	$ 519,000	$ 1,604,000	$ 1,593,000
Ownership percentage, prior approval of equity securities, threshold percentage		49.60%				49.60%		49.60%
Series E Contingently Redeemable Preferred Stock
Related Party Transaction [Line Items]
Preferred stock, shares issued (in shares) | shares					3,500,000		3,500,000			3,500,000
SPHG Holdings | SPHG Note Transaction
Related Party Transaction [Line Items]
Initial conversion price (in usd per share) | $ / shares														$ 22.16
SPHG Holdings | Convertible note investment
Related Party Transaction [Line Items]
Debt instrument, face amount					$ 12,900,000		$ 12,900,000			$ 12,900,000				$ 14,900,000
Debt instrument, repaid, principal								$ 2,000,000
SPHG Holdings | Convertible note investment | SPHG Note Transaction
Related Party Transaction [Line Items]
Initial conversion price (in usd per share) | $ / shares			$ 0.0451356
Debt instrument, conversion portion amount			$ 1,000
Related Party | Series E Contingently Redeemable Preferred Stock
Related Party Transaction [Line Items]
Conversion of stock, shares converted (in shares) | shares	3,500,000
Related Party | Series E Preferred Stock
Related Party Transaction [Line Items]
Preferred stock, convertible, shares issuable (in shares) | shares											19,800,000
Related Party | Purchase agreement | Series C convertible preferred stock
Related Party Transaction [Line Items]
Preferred stock, shares issued (in shares) | shares				35,000
Price per share (in usd per share) | $ / shares				$ 1,000
Proceeds from issuance of preferred stock				$ 35,000,000
Related Party | Stockholders' Agreement
Related Party Transaction [Line Items]
Board of directors, number of directors | director	7
Board of directors, number of directors under SEC | director	3
Board of directors, number of directors in independent audit committee | director	3
Board of directors, number of directors in disinterested audit committee | director	1
Litigation settlement, proceeds required to be distributed to stockholders, percentage		70.00%
Ownership percentage, prior approval of equity securities, threshold percentage		100.00%				100.00%		100.00%
Related Party | Management Services Agreement
Related Party Transaction [Line Items]
Increase (decrease) on monthly fee									$ 131,000			$ 101,900	$ 282,800
Monthly fixed fee									$ 80,000
Management services agreement, duration									1 year
Related Party | ModusLink Management Services Agreement
Related Party Transaction [Line Items]
General and administrative expense					900,000	$ 600,000	2,200,000	$ 1,700,000
Accounts payable		$ 700,000			600,000	700,000	600,000	700,000
Related Party | Air Travel
Related Party Transaction [Line Items]
General and administrative expense					400,000		500,000
Accounts payable					500,000		500,000			$ 0
Related Party | SPHG Holdings | Purchase agreement | Series C convertible preferred stock
Related Party Transaction [Line Items]
Less: Preferred dividends on Series C redeemable preferred stock					$ 500,000	$ 500,000	$ 1,600,000	$ 1,600,000
Related Party | SPHG Holdings | Convertible note investment | SPHG Note Transaction
Related Party Transaction [Line Items]
Debt instrument, repaid, principal			1,000,000
Debt instrument, periodic payment, principal			1,000,000
Long-term debt, cash amendment fee amount			100,000
Long-term debt, derecognized debt discount amount			$ 200,000
Related Party | Steel Holdings | Convertible debt | SPHG Note Transaction
Related Party Transaction [Line Items]
Debt instrument, face amount														$ 14,900,000
Steel Connect, Inc. | Steel Connect, Inc. | Related Party | SPHG Holdings
Related Party Transaction [Line Items]
Equity method investment, ownership percentage					89.60%		89.60%
Steel Connect, Inc. | Steel Connect, Inc. | Related Party | SP Group | Stockholders' Agreement
Related Party Transaction [Line Items]
Ownership percentage, prior approval required for transfer of equity interests, threshold percentage		80.00%				80.00%		80.00%
Number of corporate entity | corporateEntity		1				1		1

v3.24.1.1.u2

FAIR VALUE MEASUREMENTS - Financial Assets Measured at Fair Value on Recurring Basis and Classified by Fair Value Hierarchy (Details) - Fair value, measurements, recurring - USD ($) $ in Thousands	Apr. 30, 2024	Jan. 31, 2024	Jul. 31, 2023
SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure	$ 12,903	$ 12,900
Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	254,118		$ 85,269
Convertible note investment
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	0
Other investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	14,293
SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure			12,461
Level 1 | SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure	0
Level 1 | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	254,118		85,269
Level 1 | Convertible note investment
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	0
Level 1 | Other investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	14,293
Level 1 | SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure			0
Level 2 | SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure	0
Level 2 | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	0		0
Level 2 | Convertible note investment
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	0
Level 2 | Other investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	0
Level 2 | SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure			0
Level 3 | SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure	12,903
Level 3 | Money market funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	0		0
Level 3 | Convertible note investment
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	0
Level 3 | Other investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure	$ 0
Level 3 | SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure			$ 12,461

v3.24.1.1.u2

FAIR VALUE MEASUREMENTS - Additional Information (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
	Oct. 31, 2023	Apr. 30, 2024	Apr. 30, 2023	Jan. 31, 2024
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, fair value disclosure		$ 0
Debt securities, available-for-sale, unrealized gain (loss)			$ 0
Long-Term Debt
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Change in fair value		(400)
SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Change in fair value		442
Convertible Loan Note Investment
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Change in fair value		(1,227)
Fair value, measurements, recurring | SPHG Note
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value disclosure		$ 12,903		$ 12,900
Money market funds | Fair value, measurements, recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, understated amount	$ 54,200

v3.24.1.1.u2

FAIR VALUE MEASUREMENTS - Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation (Details) $ in Thousands	9 Months Ended
	Apr. 30, 2024 USD ($)
Convertible Loan Note Investment
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance as of July 31, 2023 (Successor)	$ 0
Purchases	1,227
Change in fair value	(1,227)
Balance as of April 30, 2024 (Successor)	0
SPHG Note
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance as of July 31, 2023 (Successor)	12,461
Purchases	0
Change in fair value	442
Balance as of April 30, 2024 (Successor)	$ 12,903

v3.24.1.1.u2

SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands	9 Months Ended
	Apr. 30, 2024	Apr. 30, 2023
Condensed Financial Information Disclosure [Abstract]
Interest	$ 1,009	$ 1,145
Income taxes	$ 215	$ 35

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