Segment Reporting (Tables)

3 Months Ended

May 04, 2019

Summary of Statements of Income Metrics Reviewed by CODM to Evaluate Performance Internally or As required under ASC 280 - Segment Reporting

The following table presents the statements of income metrics reviewed by the CODM to evaluate performance internally or as required under ASC 280—Segment Reporting (in thousands):


	Three Months Ended
	May 4,						May 5,
	2019						2018
	RH Segment		Waterworks		Total		RH Segment		Waterworks		Total
Net revenues	$	563,706	$	34,715	$	598,421	$	526,007	$	31,399	$	557,406
Gross profit		217,943		14,871		232,814		195,706		13,627		209,333
Depreciation and amortization		26,004		1,185		27,189		21,633		1,112		22,745

Summary of Balance Sheet Metrics as Required Under ASC 280 - Segment Reporting

The following table presents the balance sheet metrics as required under ASC 280—Segment Reporting (in thousands):


	May 4,						February 2,
	2019						2019
	RH Segment		Waterworks		Total		RH Segment		Waterworks		Total
Goodwill (1)	$	124,349	$	—	$	124,349	$	124,379	$	—	$	124,379
Tradenames, trademarks and domain names (2)		48,563		37,459		86,022		48,563		37,459		86,022
Total assets		2,397,748		148,084		2,545,832		2,273,951		149,067		2,423,018

(1)

The Waterworks reporting unit goodwill of $51.1 million recognized upon acquisition in fiscal 2016 was fully impaired as of February 2, 2019, with $17.4 million and $33.7 million impairment recorded in fiscal 2018 and fiscal 2017, respectively.

(2)

The Waterworks reporting unit tradename is presented net of an impairment charge of $14.6 million recorded in fiscal 2018.

Schedule of Segment Operating Income and Income Before Income Taxes

The following table presents segment operating income and income before income taxes (in thousands):


	Three Months Ended
	May 4,		May 5,
	2019		2018
Operating income:
RH Segment	$	69,400	$	49,048
Waterworks		1,094		110
Asset impairments and change in useful lives		(3,476)		—
Recall accrual		1,615		254
Loss on asset disposal reversal		—		840
Impact of inventory step-up		—		(190)
Legal costs		—		(1,915)
Income from operations		68,633		48,147
Interest expense—net		21,118		15,098
Income before income taxes	$	47,515	$	33,049

Net Revenues

Net revenues in each category were as follows (in thousands):


	Three Months Ended
	May 4,		May 5,
	2019		2018
Furniture	$	396,698	$	352,646
Non-furniture		201,723		204,760
Total net revenues	$	598,421	$	557,406