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Segment Reporting
 3 Months Ended
Apr. 30, 2023
Segment Reporting [Abstract]  
Segment Reporting

12. 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, Free People, FP Movement, Terrain and Urban Outfitters brands. 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 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 Nuuly segment consists of the Nuuly brand, which offers customers a more sustainable way to explore fashion. Nuuly Rent is a monthly women’s apparel subscription rental service.

The Company evaluates the performance of each segment based on the net sales and income from operations (excluding intercompany charges) of the segment. The Company accounts for intersegment sales and transfers as if the sales and transfers were made to third parties making similar volume purchases. 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.

 

The accounting policies of the reportable segments are the same as the policies described in Note 2, “Summary of Significant Accounting Policies,” in the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2023. 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:

 

 

Three Months Ended

 

 

 

April 30,

 

 

 

2023

 

 

2022

 

Net sales

 

 

 

 

 

 

Retail operations

 

$

1,004,101

 

 

$

963,435

 

Wholesale operations

 

 

63,415

 

 

 

69,071

 

Nuuly operations

 

 

51,470

 

 

 

22,849

 

Intersegment elimination

 

 

(5,312

)

 

 

(3,421

)

Total net sales

 

$

1,113,674

 

 

$

1,051,934

 

Income from operations

 

 

 

 

 

 

Retail operations

 

$

83,230

 

 

$

55,541

 

Wholesale operations

 

 

6,659

 

 

 

9,705

 

Nuuly operations

 

 

(271

)

 

 

(3,751

)

Intersegment elimination

 

 

(346

)

 

 

413

 

Total segment operating income

 

 

89,272

 

 

 

61,908

 

General corporate expenses

 

 

(17,889

)

 

 

(15,671

)

Total income from operations

 

$

71,383

 

 

$

46,237

 

 

 

 

 

April 30,

 

 

January 31,

 

 

April 30,

 

 

 

2023

 

 

2023

 

 

2022

 

Inventory

 

 

 

 

 

 

 

 

 

Retail operations

 

$

543,968

 

 

$

529,853

 

 

$

569,845

 

Wholesale operations

 

 

46,358

 

 

 

57,657

 

 

 

60,108

 

Total inventory

 

$

590,326

 

 

$

587,510

 

 

$

629,953

 

Rental product, net (1)

 

 

 

 

 

 

 

 

 

Nuuly operations

 

$

100,642

 

 

$

90,934

 

 

$

42,598

 

Total rental product, net

 

$

100,642

 

 

$

90,934

 

 

$

42,598

 

 

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

 

Property and equipment, net

 

 

 

 

 

 

 

 

 

Retail operations

 

$

1,145,834

 

 

$

1,138,487

 

 

$

1,117,689

 

Wholesale operations

 

 

888

 

 

 

990

 

 

 

1,293

 

Nuuly operations

 

 

54,784

 

 

 

48,258

 

 

 

30,790

 

Total property and equipment, net

 

$

1,201,506

 

 

$

1,187,735

 

 

$

1,149,772

 

 

 

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

 

 

Three Months Ended

 

 

 

April 30,

 

 

2023

 

 

2022

 

Net sales

 

 

 

 

 

 

 

 

 

 

 

 

Apparel

 

$

685,085

 

 

 

68

%

 

$

638,975

 

 

 

66

%

Home

 

 

150,224

 

 

 

15

%

 

 

162,810

 

 

 

17

%

Accessories

 

 

121,711

 

 

 

12

%

 

 

113,842

 

 

 

12

%

Other

 

 

47,081

 

 

 

5

%

 

 

47,808

 

 

 

5

%

Retail operations

 

 

1,004,101

 

 

 

100

%

 

 

963,435

 

 

 

100

%

Apparel

 

 

52,621

 

 

 

91

%

 

 

59,512

 

 

 

91

%

Accessories

 

 

5,321

 

 

 

9

%

 

 

5,963

 

 

 

9

%

Other

 

 

161

 

 

 

0

%

 

 

175

 

 

 

0

%

Wholesale operations (1)

 

 

58,103

 

 

 

100

%

 

 

65,650

 

 

 

100

%

Nuuly operations

 

 

51,470

 

 

 

 

 

 

22,849

 

 

 

 

Total net sales

 

$

1,113,674

 

 

 

 

 

$

1,051,934

 

 

 

 

 

(1)
Net of intersegment elimination.

The Apparel category includes intimates and activewear. The Home category includes home furnishings, electronics, gifts and decorative items. The Accessories category includes footwear, jewelry and handbags. The Other category includes beauty and shipping and handling.

The Company historically presented the merchandise categories on a company-wide basis. The Company has updated the presentation of the above tables to include a summary of net sales and percentage of net sales by both merchandise category and by segment. Prior year amounts have been reclassified to conform to the current year presentation.

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:

 

 

April 30,

 

 

January 31,

 

 

April 30,

 

 

 

2023

 

 

2023

 

 

2022

 

Property and equipment, net

 

 

 

 

 

 

 

 

 

Domestic operations

 

$

1,045,656

 

 

$

1,033,926

 

 

$

983,569

 

Foreign operations

 

 

155,850

 

 

 

153,809

 

 

 

166,203

 

Total property and equipment, net

 

$

1,201,506

 

 

$

1,187,735

 

 

$

1,149,772

 

 

 

 

Three Months Ended

 

 

 

April 30,

 

 

 

2023

 

 

2022

 

Net Sales

 

 

 

 

 

 

Domestic operations

 

$

979,606

 

 

$

913,564

 

Foreign operations

 

 

134,068

 

 

 

138,370

 

Total net sales

 

$

1,113,674

 

 

$

1,051,934