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Segment Reporting
 6 Months Ended
Jul. 29, 2023
Segment Reporting [Abstract]  
Segment Reporting

12. Segment Reporting

In accordance with ASC 280, Segment Reporting (“ASC 280”), the Company has identified two operating segments (American Eagle brand and Aerie brand) that also represent our reportable segments and reflect the Chief Operating Decision Maker’s (defined as our CEO) internal view of analyzing results and allocating resources. Additionally, our Todd Snyder brand, Unsubscribed brand, and Quiet Platforms have been identified as separate operating segments; however, as they do not meet the quantitative thresholds for separate disclosure, they are presented under the Other caption, as permitted by ASC 280.

 

General corporate expenses are comprised of general and administrative costs that management does not attribute to any of our operating segments. These costs primarily relate to corporate administration, information and technology resources, finance and human resources functional and organizational costs, depreciation and amortization of corporate assets, and other general and administrative expenses resulting from corporate-level activities and projects.

 

Our CEO analyzes segment results and allocates resources between segments based on the adjusted operating income , or the operating income in periods where there are no adjustments, of each segment. Adjusted operating income is a non-GAAP financial measure ("non-GAAP" or "adjusted") that is defined by the Company as operating income excluding impairment, restructuring and other charges. Adjusted operating income is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to similar measures presented by other companies. Non-GAAP information is provided as a supplement to, not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. We believe that this non-GAAP information is useful as an additional means for investors to evaluate our operating performance, when reviewed in conjunction with our GAAP consolidated financial statements and provides a higher degree of transparency. These amounts are not determined in accordance with GAAP and, therefore, should not be used exclusively in evaluating our business and operations. Adjusted operating income on a

consolidated basis is presented in the following table to reconcile the segment operating performance measure to operating income as presented on the Consolidated Financial Statements.

Reportable segment information is presented in the following table:

 

For the 13 weeks ended

 

 

For the 26 weeks ended

 

 

July 29, 2023

 

 

July 30, 2022

 

 

July 29, 2023

 

 

July 30, 2022

 

Net Revenue:

 

 

 

 

 

 

 

 

 

 

 

    American Eagle

$

767,018

 

 

$

777,828

 

 

$

1,438,110

 

 

$

1,463,407

 

    Aerie

$

380,413

 

 

$

371,683

 

 

$

739,495

 

 

$

693,395

 

Total Segment Net Revenue

$

1,147,431

 

 

$

1,149,511

 

 

$

2,177,605

 

 

$

2,156,802

 

    Other

$

108,318

 

 

$

110,393

 

 

$

217,675

 

 

$

200,077

 

    Intersegment Elimination

$

(54,870

)

 

$

(61,780

)

 

$

(113,475

)

 

$

(103,718

)

Total Net Revenue

$

1,200,879

 

 

$

1,198,124

 

 

$

2,281,805

 

 

$

2,253,161

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted Operating Income:

 

 

 

 

 

 

 

 

 

 

 

    American Eagle

$

128,664

 

 

$

109,110

 

 

$

234,203

 

 

$

213,015

 

    Aerie

$

57,253

 

 

$

11,830

 

 

$

112,922

 

 

$

54,903

 

Total Segment Adjusted Operating Income

$

185,917

 

 

$

120,940

 

 

$

347,125

 

 

$

267,918

 

    Other

$

(10,341

)

 

$

(11,507

)

 

$

(26,648

)

 

$

(27,732

)

    Intersegment Elimination

$

-

 

 

$

-

 

 

$

-

 

 

$

-

 

    General corporate expenses

$

(110,286

)

 

$

(95,419

)

 

$

(211,081

)

 

$

(184,270

)

Total Adjusted Operating Income

$

65,290

 

 

$

14,014

 

 

$

109,396

 

 

$

55,916

 

Less: Impairment, restructuring and other charges

$

-

 

 

$

-

 

 

$

(21,275

)

 

$

-

 

Total Operating Income

$

65,290

 

 

$

14,014

 

 

$

88,121

 

 

$

55,916

 

 

 

 

 

 

 

 

 

 

 

 

 

    Debt related charges

$

-

 

 

$

60,066

 

 

$

-

 

 

$

60,066

 

    Interest expense, net

$

951

 

 

$

3,421

 

 

$

1,642

 

 

$

8,009

 

    Other income, net

$

(2,150

)

 

$

(1,839

)

 

$

(5,461

)

 

$

(6,283

)

Income before income taxes

$

66,489

 

 

$

(47,634

)

 

$

91,940

 

 

$

(5,876

)

 

 

 

 

 

 

 

 

 

 

 

 

Capital Expenditures

 

 

 

 

 

 

 

 

 

 

 

    American Eagle

$

16,249

 

 

$

18,754

 

 

$

31,192

 

 

$

34,524

 

    Aerie

$

10,889

 

 

$

30,244

 

 

$

22,077

 

 

$

61,259

 

    Other

$

6,154

 

 

$

4,107

 

 

$

11,730

 

 

$

5,132

 

   General corporate expenditures

$

12,810

 

 

$

16,359

 

 

$

26,960

 

 

$

26,943

 

Total Capital Expenditures

$

46,102

 

 

$

69,464

 

 

$

91,959

 

 

$

127,858

 

 

The following table presents summarized geographical information:

 

 

 

13 Weeks Ended

 

 

26 Weeks Ended

 

(In thousands)

 

July 29,
2023

 

 

July 30,
2022

 

 

July 29,
2023

 

 

July 30,
2022

 

Total net revenue:

 

 

 

 

 

 

 

 

 

 

 

 

United States

 

$

1,005,197

 

 

$

1,027,158

 

 

$

1,919,588

 

 

$

1,935,323

 

Foreign (1)

 

 

195,682

 

 

 

170,966

 

 

 

362,217

 

 

 

317,838

 

Total net revenue

 

$

1,200,879

 

 

$

1,198,124

 

 

$

2,281,805

 

 

$

2,253,161

 
(1)
Amounts represent sales from American Eagle and Aerie international retail stores, and e-commerce sales that are billed to and/or shipped to foreign countries and international franchise royalty revenue.