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Segment Reporting
 9 Months Ended
Nov. 02, 2024
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 CODM's 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 consist 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.

Reportable segment information is presented in the following table:

 

 

13 weeks ended

 

 

39 weeks ended

 

 

November 2, 2024

 

 

October 28, 2023

 

 

November 2, 2024

 

 

October 28, 2023

 

 

Dollars in thousands

 

Net Revenue:

 

 

 

 

 

 

 

 

 

 

 

    American Eagle

$

831,914

 

 

$

857,378

 

 

$

2,384,295

 

 

$

2,295,487

 

    Aerie

 

410,442

 

 

 

393,042

 

 

 

1,198,741

 

 

 

1,132,537

 

Total Segment Net Revenue

$

1,242,356

 

 

$

1,250,420

 

 

$

3,583,036

 

 

$

3,428,024

 

    Other

 

56,562

 

 

 

111,805

 

 

 

169,002

 

 

 

329,480

 

    Intersegment Elimination

 

(9,824

)

 

 

(61,170

)

 

 

(28,019

)

 

 

(174,645

)

Total Net Revenue

$

1,289,094

 

 

$

1,301,055

 

 

$

3,724,019

 

 

$

3,582,859

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Income:

 

 

 

 

 

 

 

 

 

 

 

    American Eagle

$

147,261

 

 

$

184,029

 

 

$

431,542

 

 

$

418,232

 

    Aerie

 

88,914

 

 

 

75,850

 

 

 

219,072

 

 

 

188,772

 

Total Segment Operating Income

$

236,175

 

 

$

259,879

 

 

$

650,614

 

 

$

607,004

 

    Other

 

(12,593

)

 

 

(8,601

)

 

 

(37,596

)

 

 

(35,250

)

    Intersegment Elimination

 

—

 

 

 

—

 

 

 

—

 

 

 

—

 

    General corporate expenses

 

(99,932

)

 

 

(125,917

)

 

 

(310,423

)

 

 

(336,998

)

Impairment, restructuring and other charges(1)

 

(17,561

)

 

 

—

 

 

 

(17,561

)

 

 

(21,275

)

Total Operating Income

$

106,089

 

 

$

125,361

 

 

$

285,034

 

 

$

213,481

 

 

 

 

 

 

 

 

 

 

 

 

 

    Interest (income), net

 

(1,246

)

 

 

(2,871

)

 

 

(5,414

)

 

 

(1,229

)

    Other (income), net

 

(895

)

 

 

(3,984

)

 

 

(4,006

)

 

 

(9,446

)

Income before income taxes

$

108,230

 

 

$

132,216

 

 

$

294,454

 

 

$

224,156

 

 

 

 

 

 

 

 

 

 

 

 

 

Capital Expenditures

 

 

 

 

 

 

 

 

 

 

 

    American Eagle

$

24,036

 

 

$

17,219

 

 

$

60,757

 

 

$

48,411

 

    Aerie

 

22,503

 

 

 

9,499

 

 

 

50,119

 

 

 

31,576

 

    Other

 

3,071

 

 

 

9,760

 

 

 

10,529

 

 

 

21,490

 

   General corporate expenditures

 

11,112

 

 

 

6,478

 

 

 

36,263

 

 

 

33,438

 

Total Capital Expenditures

$

60,722

 

 

$

42,956

 

 

$

157,668

 

 

$

134,915

 

(1) Refer to Note 14, Impairment, Restructuring and Other Charges, to the Consolidated Financial Statements for additional information.

We do not allocate assets to the reportable segment level and therefore our CEO does not use segment asset information to make decisions.

 

Total net revenue for the American Eagle and Aerie reportable segments in the table above represents revenue attributable to each brand's merchandise, which comprises approximately 96% of total net revenue for each of the 13 and 39 weeks ended November 2, 2024 and October 28, 2023.

The following table presents summarized geographical information:

 

 

13 Weeks Ended

 

 

39 weeks ended

 

 

November 2, 2024

 

 

October 28, 2023

 

 

November 2, 2024

 

 

October 28, 2023

 

 

Dollars in thousands

 

Total net revenue:

 

 

 

 

 

 

 

 

 

 

 

United States

$

1,099,482

 

 

$

1,114,115

 

 

$

3,148,086

 

 

$

3,035,573

 

Foreign (1)

 

189,612

 

 

 

186,940

 

 

 

575,933

 

 

 

547,286

 

Total net revenue

$

1,289,094

 

 

$

1,301,055

 

 

$

3,724,019

 

 

$

3,582,859

 

 

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