Operating Segment Information

The Company operates the following business segments: Wholesale Footwear, Wholesale Accessories, Retail, First Cost and Licensing. The Wholesale Footwear segment, through sales to department stores, mid-tier retailers, mass market merchants, online retailers and specialty stores, derives revenue, both domestically and internationally (via our International business), from sales of branded and private label women’s, men’s, girls’ and children’s footwear. The Wholesale Accessories segment, which includes branded and private label handbags, belts and small leather goods as well as cold weather and selected other fashion accessories, derives revenue, both domestically and worldwide (via our International business), from sales to department stores, mid-tier retailers, mass market merchants, online retailers and specialty stores. Our Wholesale Footwear and Wholesale Accessories segments, through our International business, derive revenue from territories within Asia, Albania, Austria, Belgium, Bulgaria, Canada, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Ireland, Kosovo, Lithuania, Latvia, Luxembourg, Mexico, the Netherlands, Norway, Poland, Romania, Russia, Slovakia, Slovenia, Sweden, Switzerland, and Tunisia and, under special distribution arrangements, in various other territories within Australia, the Middle East, India, South and Central America and New Zealand. The Retail segment, through the operation of Company-owned retail stores in the United States, Canada and Mexico, our joint ventures in South Africa, China and Taiwan and the Company’s websites, derives revenue from sales of branded women’s, men’s and children’s footwear, accessories and licensed products to consumers. The First Cost segment represents activities of a subsidiary that earns commissions and design fees for serving as a buying agent of footwear products to mass-market merchandisers, mid-tier department stores and other retailers with respect to their purchase of footwear. In the Licensing segment, the Company generates revenue by licensing its Steve Madden®, Steven by Steve Madden® and Madden Girl® trademarks and other trademark rights for use in connection with the manufacture, marketing and sale of eyewear, outerwear, hosiery, activewear, sleepwear, jewelry, watches, hair accessories, umbrellas, bedding, luggage, and men’s leather accessories. In addition, this segment licenses the Betsey Johnson® trademark for use in connection with the manufacture, marketing and sale of women's and children's apparel, hosiery, swimwear, outerwear, sleepwear, activewear, jewelry, watches, bedding, luggage, stationery, umbrellas, and household goods. The Licensing segment also licenses the Dolce Vita® trademark for use in connection with the manufacture, marketing and sale of women's and children’s outerwear and swimwear.

Note O – Operating Segment Information (continued)



As of and for the three months ended,	Wholesale Footwear		Wholesale Accessories		Total Wholesale		Retail			First Cost		Licensing		Consolidated
March 31, 2018
Net sales to external customers	$	275,056	$	56,099	$	331,155	$	57,859		$	—	$	—	$	389,014
Gross profit	90,288		17,615		107,903		32,830			—		—		140,733
Commissions and licensing fees – net	—		—		—		—			868		2,791		3,659
Income (loss) from operations	38,378		2,409		40,787		(7,889		)	868		2,791		36,557
Segment assets	$	827,539	$	51,945	879,484		118,846			23,603		—		1,021,933
Capital expenditures					$	1,526	$	1,420		$	—	$	—	$	2,946
March 31, 2017
Net sales to external customers	$	261,149	$	51,952	$	313,101	$	53,286		$	—	$	—	$	366,387
Gross profit	85,318		16,113		101,431		31,287			—		—		132,718
Commissions and licensing fees – net	—		—		—		—			1,533		2,394		3,927
Income (loss) from operations	30,725		2,370		33,095		(6,242		)	1,533		2,394		30,780
Segment assets	$	764,386	$	59,019	823,405		109,955			10,610		—		943,970
Capital expenditures					$	1,391	$	1,902		$	—	$	—	$	3,293

Revenues by geographic area for the three months ended March 31, 2018 and 2017 are as follows:



	Three Months Ended March 31,
	2018		2017
Domestic (a)	$	341,568	$	331,395
International	47,446		34,992
Total	$	389,014	$	366,387
(a) Includes revenues of $97,033 and $87,669 for the three months ended March 31, 2018 and 2017, respectively, related to sales to U.S. customers where the title is transferred outside the U.S. and the sale is recorded by our international business.