Segment Information

12 Months Ended

Dec. 31, 2018

SEGMENT AND ENTERPRISE-WIDE INFORMATION

We have two operating segments - Direct and Retail. There have been no changes in our operating segments during the year ended December 31, 2018.

We evaluate performance using several factors, of which the primary financial measures are net sales and reportable segment contribution. Contribution is the measure of profit or loss, defined as net sales less product costs and directly attributable expenses. Directly attributable expenses include selling and marketing expenses, general and administrative expenses, and research and development expenses that are directly related to segment operations. Segment assets are those directly assigned to an operating segment's operations, primarily accounts receivable, inventories, goodwill and other intangible assets. Unallocated assets primarily include cash and cash equivalents, available-for-sale securities, derivative securities, shared information technology infrastructure, distribution centers, corporate headquarters, prepaids and other current assets, deferred income tax assets and other assets. Capital expenditures directly attributable to the Direct and Retail segments were not significant in any period.

Following is summary information by reportable segment (in thousands):



	Year Ended December 31,
	2018			2017			2016
Net Sales:
Direct	$	184,925		$	219,440		$	225,057
Retail	208,092			183,875			177,920
Unallocated royalty	3,736			2,869			3,062
Consolidated net sales	$	396,753		$	406,184		$	406,039
Contribution:
Direct	$	6,865		$	34,900		$	43,215
Retail	31,516			27,495			29,451
Unallocated royalty	3,733			2,852			3,018
Consolidated contribution	$	42,114		$	65,247		$	75,684

Reconciliation of consolidated contribution to income from continuing operations:
Consolidated contribution	$	42,114		$	65,247		$	75,684
Amounts not directly related to segments:
Operating expenses	(21,345		)	(28,944		)	(22,290		)
Other expense, net	232			(598		)	(1,813		)
Income tax expense	5,891			8,080			16,480
Income from continuing operations	$	15,110		$	27,625		$	35,101

Depreciation and amortization expense:
Direct	$	1,537		$	1,666		$	1,944
Retail	5,098			4,606			4,775
Unallocated corporate	2,307			2,371			1,155
Total depreciation and amortization expense	$	8,942		$	8,643		$	7,874

	As of December 31,
Assets:	2018			2017
Direct	$	50,907		$	40,532
Retail	204,921			192,064
Unallocated corporate	77,116			92,180
Total assets	$	332,944		$	324,776

There are no material long-lived assets held outside of the U.S.

In 2018, 2017 and 2016, each of Amazon.com and Dick's Sporting Goods accounted for more than 10% of total net sales as follows:



	Year Ended December 31,
	2018		2017		2016
Amazon.com	11.5	%	11.9	%	11.4	%
Dick's Sporting Goods	13.8	%	*		*

*Less than 10% of total net sales.