Revenue Recognition and Receivables

9 Months Ended

Nov. 02, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition and Receivables

Revenue Recognition and Receivables: Our revenue consists of direct to consumer sales, including our retail store, e-commerce and food & beverage operations, and wholesale sales, as well as royalty income, which is included in royalties and other operating income in our consolidated statements of operations. We recognize revenue when performance obligations under the terms of the contracts with our customers are satisfied. Our accounting policies related to revenue recognition for each type of contract with customers is described in the significant accounting policies described in our Fiscal 2023 Form 10-K.

The table below quantifies net sales by distribution channel (in thousands) for each period presented.

	Third Quarter				First Nine Months
	Fiscal 2024		Fiscal 2023		Fiscal 2024		Fiscal 2023
Retail	$	116,420	$	121,804	$	445,113	$	449,546
E-commerce	101,048		113,531		373,799		391,559
Food & Beverage	23,522		22,562		87,291		84,097
Wholesale	67,107		68,716		220,122		241,857
Other	(72)		17		(230)		(13)
Net sales	$	308,025	$	326,630	$	1,126,095	$	1,167,046

An estimated sales return liability of $7 million, $13 million and $8 million for expected direct to consumer returns is classified in accrued expenses and other liabilities in our consolidated balance sheet as of November 2, 2024, February 3, 2024, and October 28, 2023, respectively. As of November 2, 2024, February 3, 2024, and October 28, 2023, prepaid expenses and other current assets included $2 million, $4 million and $3 million, respectively, relating to the estimated value of inventory for expected direct to consumer and wholesale sales returns.

Substantially all amounts recognized in receivables, net represent trade receivables related to contracts with customers. In the ordinary course of our wholesale operations, we offer discounts, allowances and cooperative advertising support to and accept returns from certain of our wholesale customers for certain products. As of November 2, 2024, February 3, 2024, and October 28, 2023, reserve balances recorded as a reduction to receivables related to these items were $3 million, $3 million and $3 million, respectively. As of November 2, 2024, February 3, 2024, and October 28, 2023, our provision for credit losses related to receivables included in our consolidated balance sheets was $1 million, $1 million and $1 million, respectively.

Contract liabilities for gift cards purchased by consumers and merchandise credits received by customers but not yet redeemed, less any breakage income recognized to date, is included in accrued expenses and other liabilities in our consolidated balance sheet and totaled $20 million, $20 million and $18 million as of November 2, 2024, February 3, 2024, and October 28, 2023, respectively.