SEGMENT INFORMATION

12 Months Ended

Dec. 30, 2023

Segment Reporting [Abstract]

SEGMENT INFORMATION

NOTE 4. SEGMENT INFORMATION

At December 30, 2023, the Company had four reportable segments:

ODP Business Solutions Division – The Company’s leading B2B distribution solutions provider serving small, medium and enterprise level companies, including those in the public and education sectors. This segment operates in the United States, Puerto Rico, the U.S. Virgin Islands, and Canada. The ODP Business Solutions Division sells nationally branded, as well as the Company’s private branded, office supply and adjacency products and services to customers, who are served through a dedicated sales force, catalogs, telesales, and electronically through the Company’s Internet websites. Adjacency products and services include cleaning, janitorial, and breakroom supplies, office furniture, technology products, and copy and print services. This segment also includes our Federation entities, which are over 20 regional office supply distribution businesses acquired by the Company as part of its transformation to expand its reach and distribution network into geographic areas that were previously underserved, and which continue to operate under their own brand names. The acquisition of these businesses has allowed for an effective means to expand our distribution reach, target new business customers and grow our offerings beyond traditional office supplies.

Office Depot Division – The Company’s leading provider of retail consumer and small business products and services distributed through a fully integrated omni-channel platform of 916 Office Depot and OfficeMax retail locations in the United States, Puerto Rico and the U.S. Virgin Islands, and an eCommerce presence (www.officedepot.com). The Office Depot Division sells office supplies, technology products and solutions, business machines and related supplies, cleaning, breakroom and facilities products, personal protective equipment, and office furniture as well as offering business services including copying, printing, digital imaging, mailing, shipping and technology support services. In addition, the print needs for retail and business customers are facilitated through the Company’s regional print production centers.

Veyer Division – The Company’s supply chain, distribution, procurement and global sourcing operation, which specializes in B2B and consumer business service delivery, with core competencies in distribution, fulfillment, transportation, global sourcing and purchasing. The Veyer Division’s customers include our Office Depot Division and ODP Business Solutions Division, as well as third-party customers. The Veyer Division also includes the Company’s global sourcing operations in Asia.

Varis Division – The Company’s tech-enabled B2B indirect procurement marketplace, which provides a seamless way for buyers and suppliers to transact through the platform’s consumer-like buying experience, advanced spend management tools, network of suppliers, and technology capabilities. In connection with the Company’s development efforts of this Division, it acquired BuyerQuest Holdings, Inc. (“BuyerQuest”) in 2021, a software as a service eProcurement platform company. BuyerQuest’s operating results are included in the Varis Division. The Varis Division currently serves enterprise businesses and provides its services to middle- and small-sized businesses. It is focused on filling the growing demand for a B2B centric digital commerce platform that is modern, trusted, and provides the procurement controls and visibility businesses require to operate.

Division operating income is determined based on the measure of performance reported internally to manage the business and for resource allocation. This measure charges to the respective Divisions those expenses considered directly or closely related to their operations and allocates support costs. Certain operating expenses and credits are not allocated to the Divisions, including asset impairments and merger, restructuring and other operating expenses, as well as expenses and credits retained at the Corporate level, including certain management costs and legacy pension and environmental matters. Other companies may charge more or less of these items to their segments and results may not be comparable to similarly titled measures used by other entities.

The following is a summary of sales and operating income (loss) by each of the Divisions, reconciled to consolidated totals:

(In millions)	ODP Business Solutions Division		Office Depot Division		Veyer Division		Varis Division			Eliminations			Total
2023
Sales (external)	$	3,904	$	3,884	$	35	$	8		$	-		$	7,831
Sales (internal)		13		34		5,253		-			(5,300	)		—
Total sales	$	3,917	$	3,918	$	5,288	$	8		$	(5,300	)	$	7,831
Division operating income (loss)	$	174	$	230	$	34	$	(63	)	$	-		$	375
2022
Sales (external)	$	4,005	$	4,451	$	28	$	7		$	-		$	8,491
Sales (internal)		19		36		5,855		-			(5,910	)		-
Total sales	$	4,024	$	4,487	$	5,883	$	7		$	(5,910	)	$	8,491
Division operating income (loss)	$	140	$	285	$	28	$	(66	)	$	-		$	387
2021
Sales (external)	$	3,602	$	4,830	$	28	$	5		$	-		$	8,465
Sales (internal)		24		34		5,963		-			(6,021	)		-
Total sales	$	3,626	$	4,864	$	5,991	$	5		$	(6,021	)	$	8,465
Division operating income (loss)	$	72	$	325	$	30	$	(34	)	$	-		$	393

A reconciliation of the measure of Division operating income to Consolidated income from continuing operations before income taxes is as follows:

(In millions)	2023			2022			2021
Division operating income	$	375		$	387		$	393
Add/(subtract):
Asset impairments		(85	)		(14	)		(20	)
Merger, restructuring and other operating expenses, net		(4	)		(39	)		(51	)
Unallocated expenses		(85	)		(91	)		(88	)
Interest income		10			5			1
Interest expense		(20	)		(16	)		(28	)
Other income, net		9			10			24
Income from continuing operations before    income taxes	$	200		$	242		$	231

The following table provides information about disaggregated sales by major categories:

(In millions)	2023		2022		2021
Major sales categories
Supplies	$	3,899	$	4,144	$	3,815
Technology		2,178		2,461		2,758
Furniture and other		1,103		1,255		1,302
Copy and print		651		631		590
Total	$	7,831	$	8,491	$	8,465

The following table provides information about other significant balances by each of the Divisions, reconciled to consolidated totals:

(In millions)	ODP Business Solutions Division		Office Depot Division		Veyer Division		Varis Division		Corporate and Discontinued Operations*		Consolidated Total
2023
Capital expenditures	$	10	$	20	$	21	$	24	$	30	$	105
Depreciation and amortization		17		43		35		17		3		115
Assets		768		1,556		1,076		60		426		3,886
2022
Capital expenditures		5		14		20		44		16		99
Depreciation and amortization		21		56		37		13		4		131
Assets		749		1,553		993		130		724		4,149
2021
Capital expenditures		5		15		22		14		17		73
Depreciation and amortization		24		67		40		4		11		146