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Segment Reporting
 12 Months Ended
Jan. 31, 2022
Segment Reporting [Abstract]  
Segment Reporting

17. Segment Reporting

The Company offers lifestyle-oriented general merchandise and consumer products and services through a portfolio of global consumer brands. The Company operates three reportable segments—“Retail,” “Wholesale” and “Nuuly.”

The Company’s Retail segment consists of the Anthropologie, Bhldn, Free People, FP Movement, Terrain, Urban Outfitters and Menus & Venues brands. The Anthropologie, Bhldn and Terrain brands make up the Anthropologie Group. The Free People and FP Movement brands make up the Free People Group. As of January 31, 2022, there were 261 Urban Outfitters stores, 238 Anthropologie Group stores, 173 Free People Group stores, 10 Menus & Venues restaurants, two Urban Outfitters franchisee-owned stores, and one Anthropologie franchisee-owned store. Each of, Urban Outfitters, the Anthropologie Group and the Free People Group, including their Company-owned and franchisee-owned store and digital channels, and Menus & Venues restaurants, are considered an operating segment. Net sales from the Retail segment accounted for approximately 93.4%, 93.6% and 91.6% of total consolidated net sales for fiscal 2022, 2021 and 2020, respectively.

The Company has aggregated its brands into the Retail segment based upon their shared management, customer base and economic characteristics. Reporting in this format provides management with the financial information necessary to evaluate the success of the segments and the overall business. The Company’s Retail segment omni-channel strategy enhances its customers’ brand experience by providing a seamless approach to the customer shopping experience. All available Company-owned Retail segment

shopping channels are fully integrated, including retail locations, websites, mobile applications, catalogs and customer contact centers. The Company’s investments in areas such as marketing campaigns and technology advancements are designed to generate demand for the Retail segment omni-channel and not the separate store or digital channels. The Company manages and analyzes its performance based on a single Retail segment omni-channel rather than separate channels and believes that the Retail segment omni-channel results present the most meaningful and appropriate measure of our performance.

The Company’s Wholesale segment consists of the Free People, FP Movement and Urban Outfitters brands. The Wholesale segment sells through department and specialty stores worldwide, digital businesses and the Retail segment. The Wholesale segment primarily designs, develops and markets young women’s contemporary casual apparel, intimates, FP Movement activewear and shoes under the Free People Group and the BDG and other own brand apparel collections under the Urban Outfitters brand. The Urban Outfitters wholesale division was established in fiscal 2019. The Anthropologie brand exited the wholesale business in the third quarter of fiscal 2021. Our Wholesale segment net sales accounted for approximately 5.5%, 5.7% and 8.2% of total consolidated net sales for fiscal 2022, 2021 and 2020, respectively.

The Nuuly segment, formerly known as the Subscription segment, consists of the Nuuly brand, which offers customers with a more sustainable way to explore fashion. Nuuly Rent is a monthly women’s apparel subscription rental service that launched in July 2019. For a monthly fee, Nuuly subscribers can select rental product from a wide selection of the Company’s own brands, third-party market brands and one-of-a-kind vintage pieces via a custom-built, digital platform. Subscribers select their products each month, wear them as often as they like and then swap into new products the following month. Subscribers are also able to purchase the rented product. Nuuly Thrift, which launched in October 2021, is a peer-to-peer resale marketplace where customers can buy and sell women’s, men’s, and kids’ apparel, shoes, and accessories from any brands. Sellers on Nuuly Thrift can transfer their earnings to their bank account or convert them to “Nuuly Cash,” a gift card with a bonus, to be used at any of the Company’s brands. The Company earns a commission based on sales made in the marketplace. Nuuly segment net sales accounted for approximately 1.1% of consolidated net sales for fiscal 2022 and less than 1.0% of consolidated net sales for fiscal 2021 and 2020, respectively.

The Company evaluates the performance of each segment based on the net sales and pre-tax income from operations (excluding intercompany charges) of the segment. Corporate expenses include expenses incurred and directed by the corporate office that are not allocated to segments. The principal identifiable assets for the Retail and Wholesale segments are inventory and property and equipment. The principal identifiable assets for the Nuuly segment are rental product and property and equipment.

Other assets are comprised primarily of general corporate assets, which principally consist of cash and cash equivalents, marketable securities, deferred taxes and prepaid expenses, and are typically not allocated to the Company’s segments. The Company accounts for intersegment sales and transfers as if the sales and transfers were made to third parties making similar volume purchases.

The accounting policies of the reportable segments are the same as the policies described in Note 2, “Summary of Significant Accounting Policies.” All of the Company’s segments are highly diversified. No one customer constitutes more than 10% of the Company’s total consolidated net sales. A summary of the information about the Company’s operations by segment is as follows:

 

 

 

Fiscal Year

 

 

 

2022

 

 

2021

 

 

2020

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

Retail operations

 

$

4,248,681

 

 

$

3,228,200

 

 

$

3,648,938

 

Wholesale operations

 

 

267,576

 

 

 

216,937

 

 

 

340,869

 

Nuuly operations

 

 

47,724

 

 

 

24,336

 

 

 

8,001

 

Intersegment elimination

 

 

(15,218

)

 

 

(19,724

)

 

 

(14,019

)

Total net sales

 

$

4,548,763

 

 

$

3,449,749

 

 

$

3,983,789

 

Income (loss) from operations

 

 

 

 

 

 

 

 

 

 

 

 

Retail operations

 

$

449,453

 

 

$

68,384

 

 

$

256,540

 

Wholesale operations

 

 

32,937

 

 

 

(10,180

)

 

 

42,315

 

Nuuly operations

 

 

(20,150

)

 

 

(18,367

)

 

 

(19,639

)

Intersegment elimination

 

 

1,643

 

 

 

(494

)

 

 

257

 

Total segment operating income

 

 

463,883

 

 

 

39,343

 

 

 

279,473

 

General corporate expenses (1)

 

 

(55,317

)

 

 

(35,371

)

 

 

(47,548

)

Total income from operations

 

$

408,566

 

 

$

3,972

 

 

$

231,925

 

 

 

(1)

General corporate expenses during fiscal 2021 benefitted from the recognition of COVID-19 related government relief packages.

 

 

 

Fiscal Year

 

 

 

2022

 

 

2021

 

 

2020

 

Depreciation expense for property and equipment

 

 

 

 

 

 

 

 

 

 

 

 

Retail operations

 

$

94,099

 

 

$

97,911

 

 

$

109,622

 

Wholesale operations

 

 

547

 

 

 

545

 

 

 

578

 

Nuuly operations

 

 

4,412

 

 

 

3,741

 

 

 

1,350

 

Total depreciation expense for property and equipment

 

$

99,058

 

 

$

102,197

 

 

$

111,550

 

Inventory

 

 

 

 

 

 

 

 

 

 

 

 

Retail operations

 

$

507,510

 

 

$

348,797

 

 

 

 

 

Wholesale operations

 

 

62,189

 

 

 

40,821

 

 

 

 

 

Total inventory

 

$

569,699

 

 

$

389,618

 

 

 

 

 

Rental product, net (1)

 

 

 

 

 

 

 

 

 

 

 

 

Nuuly operations

 

$

32,075

 

 

$

11,857

 

 

 

 

 

Total rental product, net

 

$

32,075

 

 

$

11,857

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Rental product, net is included in "Deferred income taxes and other assets" in the Consolidated Balance Sheets.

 

 

Property and equipment, net

 

 

 

 

 

 

 

 

 

 

 

 

Retail operations

 

$

1,113,294

 

 

$

938,020

 

 

 

 

 

Wholesale operations

 

 

1,458

 

 

 

2,096

 

 

 

 

 

Nuuly operations

 

 

30,333

 

 

 

27,306

 

 

 

 

 

Total property and equipment, net

 

$

1,145,085

 

 

$

967,422

 

 

 

 

 

Cash paid for property and equipment

 

 

 

 

 

 

 

 

 

 

 

 

Retail operations

 

$

254,921

 

 

$

155,343

 

 

$

189,904

 

Wholesale operations

 

 

69

 

 

 

390

 

 

 

633

 

Nuuly operations

 

 

7,439

 

 

 

3,509

 

 

 

26,896

 

Total cash paid for property and equipment

 

$

262,429

 

 

$

159,242

 

 

$

217,433

 

 

 

The following tables summarize net sales and percentage of net sales from contracts with customers by merchandise category:

 

 

 

Fiscal Year

 

 

 

2022

 

 

2021

 

 

2020

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

Apparel (1)

 

 

2,912,901

 

 

 

2,111,828

 

 

 

2,596,926

 

Home (2)

 

 

852,379

 

 

 

731,237

 

 

 

649,184

 

Accessories (3)

 

 

543,337

 

 

 

411,927

 

 

 

517,219

 

Other (4)

 

 

240,146

 

 

 

194,757

 

 

 

220,460

 

Total net sales

 

 

4,548,763

 

 

 

3,449,749

 

 

 

3,983,789

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As a percentage of net sales

 

 

 

 

 

 

 

 

 

 

 

 

Apparel (1)

 

 

64

%

 

 

61

%

 

 

65

%

Home (2)

 

 

19

%

 

 

21

%

 

 

16

%

Accessories (3)

 

 

12

%

 

 

12

%

 

 

13

%

Other (4)

 

 

5

%

 

 

6

%

 

 

6

%

Total net sales

 

 

100

%

 

 

100

%

 

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)   Apparel includes intimates and activewear

 

(2)   Home includes home furnishings, electronics, gifts and decorative items

 

(3)   Accessories includes footwear, jewelry and handbags

 

(4)   Other includes beauty, shipping and handling, the Menus & Venues brand and the Nuuly segment

 

 

 

Apparel, Home, and Accessories are sold through both the Retail and Wholesale segments. Revenue recognized from the Other category is primarily attributable to the Retail segment.

 

The Company has foreign operations primarily in Europe and Canada. Revenues and long-lived assets, based upon the Company’s domestic and foreign operations, are as follows:

 

 

 

Fiscal Year

 

 

 

2022

 

 

2021

 

 

2020

 

Net Sales

 

 

 

 

 

 

 

 

 

 

 

 

Domestic operations

 

$

3,950,381

 

 

$

3,040,778

 

 

$

3,485,383

 

Foreign operations

 

 

598,382

 

 

 

408,971

 

 

 

498,406

 

Total net sales

 

$

4,548,763

 

 

$

3,449,749

 

 

$

3,983,789

 

Property and equipment, net

 

 

 

 

 

 

 

 

 

 

 

 

Domestic operations

 

$

965,777

 

 

$

768,440

 

 

 

 

 

Foreign operations

 

 

179,308

 

 

 

198,982

 

 

 

 

 

Total property and equipment, net

 

$

1,145,085

 

 

$

967,422