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Segment Reporting
 6 Months Ended
Aug. 01, 2025
Segment Reporting [Abstract]  
Segment Reporting

NOTE 12. SEGMENT REPORTING

The Company identifies operating segments according to how business activities are managed and evaluated. Following internal organizational changes and realignment of distribution channel responsibilities in Fourth Quarter 2024, the Company’s operating segments consisted of: U.S. eCommerce, Europe eCommerce, Outfitters, Third Party, Licensing and Retail. Beginning Fourth Quarter 2024, the Wholesale business is included in Licensing and prior periods were recast to reflect the change in operating segments for comparability purposes.

 

•
U.S. eCommerce offers products through the Company’s eCommerce website.

 

•
Europe eCommerce offers products primarily direct to consumers located in Europe through eCommerce international websites as well as third-party marketplace websites.

 

•
Outfitters sells uniform and logo apparel to businesses and their employees, as well as to student households through school relationships, located primarily in the U.S.

 

•
Third Party sells products direct to consumers through third-party marketplace websites.

 

•
Licensing earns royalties on the use of Lands’ End trademark and any fulfillment fees for fulfillment services provided by the Company.

•
Retail sells products through the Company Operated stores, located in the U.S.

The internal reporting of these operating segments is based, in part, on the reporting and review process used by the Company’s chief operating decision maker (“CODM”), its Chief Executive Officer. The CODM assesses segment performance based on variable profit, which is defined as net revenue minus cost of sales and variable selling expenses. The Company’s CODM monitors actual segment variable profit results relative to operating plan and forecast to assess the performance of the business and allocate resources. The CODM does not utilize segment asset information to evaluate performance and make resource allocation decisions, and thus such disclosures are not provided. Variable profit is a non-GAAP financial measure, which management believes provides useful information to investors and to the CODM in order to assess segment performance. A reconciliation of variable profit to consolidated loss before income taxes is set forth below.

The Company determined the U.S. eCommerce, Outfitters and Third Party operating segments share similar economic and other qualitative characteristics, and therefore the results of these operating segments are aggregated into the U.S. Digital segment. The Europe eCommerce, Licensing and Retail operating segments are not quantitatively significant to be separately reported.

The Company has determined its significant segment expense categories based on amounts regularly provided to the Company’s CODM to evaluate segment profitability and drive strategic decision making. The following presents U.S. Digital segment sales and expenses:

 

 

13 Weeks Ended

 

 

13 Weeks Ended

 

 

 

August 1, 2025

 

 

August 2, 2024

 

(in thousands)

 

Segment

 

Total

 

 

Segment

 

Total

 

Net revenue

 

$

255,254

 

$

255,254

 

 

$

270,361

 

$

270,361

 

All other net revenue (1)

 

 

 

 

38,825

 

 

 

 

 

46,812

 

Total consolidated net revenue

 

 

 

$

294,079

 

 

 

 

$

317,173

 

Product cost of goods sold

 

 

100,484

 

 

 

 

 

105,675

 

 

 

Shipping cost of goods sold

 

 

32,962

 

 

 

 

 

34,808

 

 

 

Marketing costs

 

 

43,283

 

 

 

 

 

41,883

 

 

 

Variable personnel costs

 

 

14,631

 

 

 

 

 

17,066

 

 

 

Other segment expenses (2)

 

 

7,204

 

 

 

 

 

8,119

 

 

 

Segment variable profit

 

$

56,690

 

 

 

 

$

62,810

 

 

 

 

(1)
All other net revenue is from Europe eCommerce, Licensing and Retail that does not meet the quantitative thresholds
(2)
Other segment expenses include credit card fees, customer service, webhosting, supplies and other miscellaneous expenses

 

 

 

26 Weeks Ended

 

 

26 Weeks Ended

 

 

 

August 1, 2025

 

 

August 2, 2024

 

(in thousands)

 

Segment

 

Total

 

 

Segment

 

Total

 

Net revenue

 

$

483,006

 

$

483,006

 

 

$

499,089

 

$

499,089

 

All other net revenue (1)

 

 

 

 

72,281

 

 

 

 

 

103,555

 

Total consolidated net revenue

 

 

 

$

555,287

 

 

 

 

$

602,644

 

Product cost of goods sold

 

 

184,085

 

 

 

 

 

185,463

 

 

 

Shipping cost of goods sold

 

 

62,151

 

 

 

 

 

68,042

 

 

 

Marketing costs

 

 

83,216

 

 

 

 

 

80,985

 

 

 

Variable personnel costs

 

 

30,201

 

 

 

 

 

33,110

 

 

 

Other segment expenses (2)

 

 

13,769

 

 

 

 

 

13,803

 

 

 

Segment variable profit

 

$

109,584

 

 

 

 

$

117,686

 

 

 

 

(1)
All other net revenue is from Europe eCommerce, Licensing and Retail that does not meet the quantitative thresholds
(2)
Other segment expenses include credit card fees, customer service, webhosting, supplies and other miscellaneous expenses

The reconciliation between segment variable profit to consolidated loss before income taxes is as follows:

 

 

 

13 Weeks Ended

 

 

13 Weeks Ended

 

(in thousands)

 

August 1, 2025

 

 

August 2, 2024

 

Segment variable profit

 

$

56,690

 

 

$

62,810

 

All other variable profit (1)

 

 

8,306

 

 

 

9,186

 

Depreciation expense

 

 

(7,656

)

 

 

(8,692

)

Unallocated corporate expenses (2)

 

 

(53,357

)

 

 

(60,818

)

Interest expense

 

 

(9,262

)

 

 

(10,447

)

Other income, net

 

 

3

 

 

 

84

 

Loss before income taxes

 

$

(5,276

)

 

$

(7,877

)

 

(1)
All other variable profit is from Europe eCommerce, Licensing and Retail that does not meet the quantitative thresholds
(2)
Unallocated corporate expenses include fixed personnel costs, incentive compensation, office occupancy, information technology and professional fees

 

 

 

26 Weeks Ended

 

 

26 Weeks Ended

 

(in thousands)

 

August 1, 2025

 

 

August 2, 2024

 

Segment variable profit

 

$

109,584

 

 

$

117,686

 

All other variable profit (1)

 

 

14,151

 

 

 

19,511

 

Depreciation expense

 

 

(15,947

)

 

 

(17,697

)

Unallocated corporate expenses (2)

 

 

(106,175

)

 

 

(114,781

)

Interest expense

 

 

(18,527

)

 

 

(20,783

)

Other income, net

 

 

14

 

 

 

172

 

Loss before income taxes

 

$

(16,900

)

 

$

(15,892

)

 

 

(1)
All other variable profit is from Europe eCommerce, Licensing and Retail that does not meet the quantitative thresholds
(1)
Unallocated corporate expenses include fixed personnel costs, incentive compensation, office occupancy, information technology and professional fees

 

Net revenue is presented by distribution channel in the following tables:

 

 

 

13 Weeks Ended

 

% of Net

 

 

13 Weeks Ended

 

% of Net

 

(in thousands)

 

August 1, 2025

 

Revenue

 

 

August 2, 2024

 

Revenue

 

Net revenue:

 

 

 

 

 

 

 

 

 

 

U.S. eCommerce

 

$

167,268

 

 

56.9

%

 

$

188,336

 

 

59.4

%

Outfitters

 

 

66,424

 

 

22.6

%

 

 

63,159

 

 

19.9

%

Third Party

 

 

21,562

 

 

7.3

%

 

 

18,866

 

 

6.0

%

Total U.S. Digital Segment Revenue

 

 

255,254

 

 

 

 

 

270,361

 

 

 

Europe eCommerce

 

 

19,639

 

 

6.7

%

 

 

22,950

 

 

7.2

%

Licensing and Retail

 

 

19,186

 

 

6.5

%

 

 

23,862

 

 

7.5

%

Total Net revenue

 

$

294,079

 

 

 

 

$

317,173

 

 

 

 

 

 

26 Weeks Ended

 

% of Net

 

 

26 Weeks Ended

 

% of Net

 

(in thousands)

 

August 1, 2025

 

Revenue

 

 

August 2, 2024

 

Revenue

 

Net revenue:

 

 

 

 

 

 

 

 

 

 

U.S. eCommerce

 

$

338,016

 

 

60.9

%

 

$

358,868

 

 

59.5

%

Outfitters

 

 

109,346

 

 

19.7

%

 

 

105,836

 

 

17.6

%

Third Party

 

 

35,644

 

 

6.4

%

 

 

34,385

 

 

5.7

%

Total U.S. Digital Segment Revenue

 

 

483,006

 

 

 

 

 

499,089

 

 

 

Europe eCommerce

 

 

37,490

 

 

6.7

%

 

 

47,918

 

 

8.0

%

Licensing and Retail

 

 

34,791

 

 

6.3

%

 

 

55,637

 

 

9.2

%

Total Net revenue

 

$

555,287

 

 

 

 

$

602,644