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Segment Reporting (Notes)
 6 Months Ended
Oct. 29, 2022
Segment Reporting
Note 4. Segment Reporting
We have three reportable segments: Retail, Wholesale and DSS. Additionally, unallocated shared-service costs, which include various corporate level expenses and other governance functions, continue to be presented as “Corporate Services”.
We identify our segments in accordance with the way our business is managed (focusing on the financial information distributed) and the manner in which our chief operating decision maker allocates resources and assesses financial performance. The following summarizes the three segments. For additional information about each segment's operations, see Part I - Item 1. Business in our Annual Report on Form 10-K for the fiscal year ended April 30, 2022.
Retail
The Retail Segment operates 1,399 college, university, and K-12 school bookstores, comprised of 793 physical bookstores and 606 virtual bookstores. Our bookstores typically operate under agreements with the college, university, or K-12 schools to be the official bookstore and the exclusive seller of course materials and supplies, including physical and digital products. The majority of the physical campus bookstores have school-branded e-commerce websites which we operate independently or along with our merchant partners, and which offer students access to affordable course materials and affinity products, including emblematic apparel and gifts. The Retail Segment also offers inclusive and equitable access programs, in which course materials are offered at a reduced price through a fee charged by the institution or included in tuition, and delivered to students on or before the first day of class. Additionally, the Retail Segment offers a suite of digital content and services to colleges and universities, including a variety of open educational resource-based courseware.
Wholesale
The Wholesale Segment is comprised of our wholesale textbook business and is one of the largest textbook wholesalers in the country. The Wholesale Segment centrally sources, sells, and distributes new and used textbooks to approximately 3,100 physical bookstores (including our Retail Segment's 793 physical bookstores) and sources and distributes new and used textbooks to our 606 virtual bookstores. Additionally, the Wholesale Segment sells hardware and a software suite of applications that provides inventory management and point-of-sale solutions to approximately 350 college bookstores.
DSS
The Digital Student Solutions (“DSS”) Segment includes products and services to assist students to study more effectively and improve academic performance. The DSS Segment is comprised of the operations of Student Brands, LLC, a leading direct-to-student subscription-based writing services business, and bartleby®, an institutional and direct-to-student subscription-based offering providing textbook solutions, expert questions and answers, writing and tutoring.
Corporate Services represents unallocated shared-service costs which include corporate level expenses and other governance functions, including executive functions, such as accounting, legal, treasury, information technology, and human resources.
Intercompany Eliminations
The eliminations are primarily related to the following intercompany activities:
•The sales eliminations represent the elimination of Wholesale sales and fulfillment service fees to Retail and the elimination of Retail commissions earned from Wholesale, and
•These cost of sales eliminations represent (i) the recognition of intercompany profit for Retail inventory that was purchased from Wholesale in a prior period that was subsequently sold to external customers during the current period and the elimination of Wholesale service fees charged for fulfillment of inventory for virtual store sales, net of (ii) the elimination of intercompany profit for Wholesale inventory purchases by Retail that remain in ending inventory at the end of the current period.
Our international operations are not material, and the majority of the revenue and total assets are within the United States.
Summarized financial information for our reportable segments is reported below:
13 weeks ended26 weeks ended
October 29, 2022October 30, 2021October 29, 2022October 30, 2021
Sales:
Retail$598,610 $608,952 $835,117 $819,421 
Wholesale21,120 21,669 58,203 66,153 
DSS8,465 8,279 17,649 16,582 
Elimination (11,097)(11,923)(30,013)(34,385)
Total Sales$617,098 $626,977 $880,956 $867,771 
Gross Profit
Retail (a)
$129,502 $128,825 $183,495 $176,968 
Wholesale5,455 5,620 12,354 16,025 
DSS6,694 6,906 14,177 13,936 
Elimination3,184 4,208 (1,703)(1,341)
Total Gross Profit$144,835 $145,559 $208,323 $205,588 
Selling and Administrative Expenses
Retail$90,086 $89,486 $169,090 $157,851 
Wholesale3,867 4,387 7,998 8,378 
DSS8,132 7,305 16,277 13,752 
Corporate Services5,075 6,809 12,289 14,253 
Elimination(74)(85)(82)(97)
Total Selling and Administrative Expenses$107,086 $107,902 $205,572 $194,137 
Depreciation and Amortization
Retail$8,869 $8,669 $18,398 $18,076 
Wholesale1,370 1,364 2,719 2,664 
DSS503 1,902 2,140 3,801 
Corporate Services17 17 35 35 
Total Depreciation and Amortization$10,759 $11,952 $23,292 $24,576 
Operating Income (Loss)
Retail$30,547 $29,595 $(3,993)$(1,042)
Wholesale218 (131)1,637 4,983 
DSS(1,941)(2,301)(4,240)(3,617)
Corporate Services(5,352)(6,867)(12,959)(15,226)
Elimination 3,258 4,293 (1,621)(1,244)
Total Operating Income (Loss)$26,730 $24,589 $(21,176)$(16,146)
13 weeks ended26 weeks ended
Reconciliation of segment Operating Income (Loss) to consolidated Income (Loss) Before Income Taxes:October 29, 2022October 30, 2021October 29, 2022October 30, 2021
Total Operating Income (Loss)$26,730 $24,589 $(21,176)$(16,146)
Interest Expense, net4,886 2,264 8,754 4,758 
Income (Loss) Before Income Taxes$21,844 $22,325 $(29,930)$(20,904)
(a)    For the 26 weeks ended October 30, 2021, gross margin includes a merchandise inventory loss of $434 in the Retail Segment. See Note 2. Summary of Significant Accounting Policies - Merchandise Inventories.