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REVENUE RECOGNITION | 6 Months Ended
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Jul. 02, 2022
Revenue from Contract with Customer [Abstract] |
REVENUE RECOGNITION | REVENUE RECOGNITION The Company’s revenues are earned from contracts or arrangements with retail and wholesale customers and licensees. Contracts include written agreements, as well as arrangements that are implied by customary practices or law. Disaggregation of Revenue The Company sells its products directly to consumers (“direct-to-consumer”) and to other retail companies and partners that subsequently sell the products directly to their own retail customers. The Company also earns royalties from certain of its licensees. Disaggregated revenues from these sources for the second quarter and two quarters ended fiscal 2022 and 2021 were as follows:
|  | Fiscal quarter ended July 2, 2022
(dollars in thousands) |  | U.S. Retail |  | U.S. Wholesale |  | International |  | Total
Wholesale channel |  | $ | — |  |  | $ | 224,016 |  |  | $ | 37,019 |  |  | $ | 261,035 |
Direct-to-consumer |  | 379,097 |  |  | — |  |  | 60,563 |  |  | 439,660 |
|  | $ | 379,097 |  |  | $ | 224,016 |  |  | $ | 97,582 |  |  | $ | 700,695 |
Royalty income, net |  | $ | 1,317 |  |  | $ | 2,885 |  |  | $ | 1,400 |  |  | $ | 5,602 |
|  | Two fiscal quarters ended July 2, 2022
(dollars in thousands) |  | U.S. Retail |  | U.S. Wholesale |  | International |  | Total
Wholesale channel |  | $ | — |  |  | $ | 531,317 |  |  | $ | 87,452 |  |  | $ | 618,769 |
Direct-to-consumer |  | 745,455 |  |  | — |  |  | 117,756 |  |  | 863,211 |
|  | $ | 745,455 |  |  | $ | 531,317 |  |  | $ | 205,208 |  |  | $ | 1,481,980 |
Royalty income, net |  | $ | 4,558 |  |  | $ | 6,315 |  |  | $ | 2,203 |  |  | $ | 13,076 |
|  | Fiscal quarter ended July 3, 2021
(dollars in thousands) |  | U.S. Retail |  | U.S. Wholesale |  | International |  | Total
Wholesale channel |  | $ | — |  |  | $ | 231,630 |  |  | $ | 33,610 |  |  | $ | 265,240 |
Direct-to-consumer |  | 423,627 |  |  | — |  |  | 57,533 |  |  | 481,160 |
|  | $ | 423,627 |  |  | $ | 231,630 |  |  | $ | 91,143 |  |  | $ | 746,400 |
Royalty income, net |  | $ | 2,360 |  |  | $ | 2,876 |  |  | $ | 1,409 |  |  | $ | 6,645 |
|  | Two fiscal quarters ended July 3, 2021
(dollars in thousands) |  | U.S. Retail |  | U.S. Wholesale |  | International |  | Total
Wholesale channel |  | $ | — |  |  | $ | 515,007 |  |  | $ | 76,402 |  |  | $ | 591,409 |
Direct-to-consumer |  | 830,694 |  |  | — |  |  | 111,658 |  |  | 942,352 |
|  | $ | 830,694 |  |  | $ | 515,007 |  |  | $ | 188,060 |  |  | $ | 1,533,761 |
Royalty income, net |  | $ | 5,430 |  |  | $ | 6,651 |  |  | $ | 2,027 |  |  | $ | 14,108 |
Accounts Receivable from Customers and Licensees The components of Accounts receivable, net, were as follows:
(dollars in thousands) |  | July 2, 2022 |  | January 1, 2022 |  | July 3, 2021
Trade receivables from wholesale customers, net |  | $ | 182,253 |  |  | $ | 233,928 |  |  | $ | 164,591 |
Royalties receivable |  | 5,203 |  |  | 5,769 |  |  | 5,991 |
Tenant allowances and other receivables |  | 10,671 |  |  | 10,352 |  |  | 9,478 |
Total gross receivables |  | $ | 198,127 |  |  | $ | 250,049 |  |  | $ | 180,060 |
Less: Wholesale accounts receivable reserves(*) |  | (14,207) |  |  | (18,695) |  |  | (16,103) |
Accounts receivable, net |  | $ | 183,920 |  |  | $ | 231,354 |  |  | $ | 163,957 |
(*)Includes allowance for credit losses of $5.8 million, $7.3 million, and $7.1 million for the periods ended July 2, 2022, January 1, 2022, and July 3, 2021, respectively. Contract Assets and Liabilities The Company’s contract assets are not material. Contract Liabilities The Company recognizes a contract liability when it has received consideration from a customer and has a future obligation to transfer goods to the customer. Total contract liabilities consisted of the following amounts:
(dollars in thousands) | July 2, 2022 |  | January 1, 2022 |  | July 3, 2021
Contract liabilities - current: |  |  |  |  |
Unredeemed gift cards | $ | 21,251 |  |  | $ | 21,619 |  |  | $ | 18,049 |
Unredeemed customer loyalty rewards | 4,456 |  |  | 5,659 |  |  | 4,829 |
Carter’s credit card - upfront bonus(1) | 714 |  |  | 714 |  |  | 714 |
Total contract liabilities - current(2) | $ | 26,421 |  |  | $ | 27,992 |  |  | $ | 23,592 |
Contract liabilities - non-current(3) | $ | 1,786 |  |  | $ | 2,143 |  |  | $ | 2,500 |
Total contract liabilities | $ | 28,207 |  |  | $ | 30,135 |  |  | $ | 26,092 |
(1)The Company received an upfront signing bonus from a third-party financial institution, which will be recognized as revenue on a straight-line basis over the term of the agreement. This amount reflects the current portion of this bonus to be recognized as revenue over the next twelve months. (2)Included with Other current liabilities on the Company’s consolidated balance sheet. (3)This amount reflects the non-current portion of the Carter’s credit card upfront bonus.

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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 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130551-203045 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 13 -Subparagraph (b)(2) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130556-203045 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130550-203045 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130558-203045 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -SubTopic 10 -Section 50 -Paragraph 12 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=123351226&loc=SL49130554-203045 + Details
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