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Revenue Recognition | 6 Months Ended
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Sep. 28, 2019
Revenue from Contract with Customer [Abstract] |
Revenue Recognition | Revenue Recognition The Company accounts for contracts with its customers when there is approval and commitment from both parties, the rights of the parties and payment terms have been identified, the contract has commercial substance and collectability of consideration is probable. Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers in an amount that reflects the consideration the Company expects to be entitled to in exchange for goods or services. The Company sells its products through three primary channels of distribution: retail, wholesale and licensing. Within the retail and wholesale channels, substantially all of the Company’s revenues consist of sales of products that represent a single performance obligation, where control transfers at a point in time to the customer. For licensing arrangements, royalty and advertising revenue is recognized over time based on access provided to the Company’s brands. Retail The Company generates sales through directly operated stores and e-commerce throughout the Americas (U.S., Canada and Latin America, excluding Brazil), EMEA (Europe, Middle East, and Africa) and certain parts of Asia. Gift Cards. The contract liability related to gift cards, net of estimated “breakage,” was $12 million and $13 million as of September 28, 2019 and March 30, 2019, respectively, and is included in accrued expenses and other current liabilities in the Company’s consolidated balance sheet. Loyalty Program. The contract liability, net of an estimated “breakage,” of $3 million as of both September 28, 2019 and March 30, 2019 is recorded as a reduction to revenue in the consolidated statements of operations and comprehensive income and within accrued expenses and other current liabilities in the Company’s consolidated balance sheet and is expected to be recognized within the next 12 months. Wholesale The Company’s products are sold primarily to major department stores, specialty stores and travel retail shops throughout the Americas, EMEA and Asia. The Company also has arrangements where its products are sold to geographic licensees in certain parts of EMEA, Asia, and South America. Licensing The Company provides its third-party licensees with the right to access its Versace, Jimmy Choo and Michael Kors trademarks under product and geographic licensing arrangements. Under geographic licensing arrangements, third party licensees receive the right to distribute and sell products bearing the Company’s trademarks in retail and/or wholesale channels within certain geographical areas, including Brazil, the Middle East, Eastern Europe, South Africa, certain parts of Asia and Australia. The Company recognizes royalty revenue and advertising contributions based on the percentage of sales made by the licensees. Generally the Company’s guaranteed minimum royalty amounts due from licensees relate to contractual periods that do not exceed 12 months, however, some of our guaranteed minimums for Versace are multi-year based. As of September 28, 2019, contractually guaranteed minimum fees from our license agreements expected to be recognized as revenue during future periods were as follows (in millions):
|  | Contractually Guaranteed Minimum Fees
| Remainder of Fiscal 2020 | $ | 14 |
| Fiscal 2021 | 27 |
| Fiscal 2022 | 27 |
| Fiscal 2023 | 20 |
| Fiscal 2024 | 10 |
| Fiscal 2025 and thereafter | 34 |
| Total | $ | 132 |
Sales Returns The refund liability recorded as of September 28, 2019 and March 30, 2019 was $35 million in each period and the related asset for the right to recover returned product as of September 28, 2019 and March 30, 2019 was $12 million in each period. Contract Balances Total contract liabilities were $17 million and $31 million as of September 28, 2019 and March 30, 2019, respectively. For the three and six months ended September 28, 2019, the Company recognized $3 million and $17 million, respectively, in revenue which related to contract liabilities that existed at March 30, 2019. For the three and six months ended September 29, 2018, the Company recognized $3 million and $11 million, respectively, in revenue which related to contract liabilities that existed at April 1, 2018. There were no contract assets recorded as of September 28, 2019 and March 30, 2019. There were no changes in historical variable consideration estimates that were materially different from actual results. Disaggregation of Revenue The following table presents the Company’s segment revenues disaggregated by geographic location (in millions):
| Three Months Ended |  | Six Months Ended
| September 28, 2019 |  | September 29, 2018 |  | September 28, 2019 |  | September 29, 2018
Versace revenue - the Americas | $ | 48 |  |  | $ | — |  |  | $ | 92 |  |  | $ | — |
Versace revenue - EMEA | 121 |  |  | — |  |  | 213 |  |  | — |
Versace revenue - Asia | 59 |  |  | — |  |  | 130 |  |  | — |
Total Versace | 228 |  |  | — |  |  | 435 |  |  | — |
Jimmy Choo revenue - the Americas | 21 |  |  | 20 |  |  | 51 |  |  | 46 |
Jimmy Choo revenue - EMEA | 64 |  |  | 56 |  |  | 143 |  |  | 158 |
Jimmy Choo revenue - Asia | 40 |  |  | 40 |  |  | 89 |  |  | 85 |
Total Jimmy Choo | 125 |  |  | 116 |  |  | 283 |  |  | 289 |
Michael Kors revenue - the Americas | 733 |  |  | 773 |  |  | 1,388 |  |  | 1,465 |
Michael Kors revenue - the EMEA | 224 |  |  | 233 |  |  | 413 |  |  | 433 |
Michael Kors revenue - the Asia | 132 |  |  | 131 |  |  | 269 |  |  | 269 |
Total Michael Kors | 1,089 |  |  | 1,137 |  |  | 2,070 |  |  | 2,167 |
Total revenue - the Americas | 802 |  |  | 793 |  |  | 1,531 |  |  | 1,511 |
Total revenue - EMEA | 409 |  |  | 289 |  |  | 769 |  |  | 591 |
Total revenue - Asia | 231 |  |  | 171 |  |  | 488 |  |  | 354 |
Total revenue | $ | 1,442 |  |  | $ | 1,253 |  |  | $ | 2,788 |  |  | $ | 2,456 |
See Note 3 in the Company’s Annual Report on Form 10-K for the fiscal year ended March 30, 2019 for a complete disclosure of the Company’s revenue recognition.

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 + Details
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