Revenue recognition

6 Months Ended

Jul. 29, 2023

Revenue from Contract with Customer [Abstract]

Revenue recognition

Revenue recognition

The following table provides the Company’s total sales, disaggregated by banner, for the 13 and 26 weeks ended July 29, 2023 and July 30, 2022:

	13 weeks ended July 29, 2023								13 weeks ended July 30, 2022
(in millions)	North America		International		Other		Consolidated		North America		International		Other		Consolidated
Sales by banner:
Kay	$	567.1	$	—	$	—	$	567.1	$	617.5	$	—	$	—	$	617.5
Zales	279.4		—		—		279.4		318.1		—		—		318.1
Jared	265.2		—		—		265.2		303.5		—		—		303.5
Digital banners (1) (2)	164.2		—		—		164.2		88.6						88.6
Diamonds Direct	93.1		—		—		93.1		113.0		—		—		113.0
Banter by Piercing Pagoda	79.3		—		—		79.3		100.2		—		—		100.2
Peoples	43.5		—		—		43.5		47.8		—		—		47.8
International segment banners	—		102.0		—		102.0		—		111.6		—		111.6
Other (3)	9.3		—		10.5		19.8		27.7		—		26.9		54.6
Total sales	$	1,501.1	$	102.0	$	10.5	$	1,613.6	$	1,616.4	$	111.6	$	26.9	$	1,754.9
	26 weeks ended July 29, 2023								26 weeks ended July 30, 2022
(in millions)	North America		International		Other		Consolidated		North America		International		Other		Consolidated
Sales by banner:
Kay	$	1,169.3	$	—	$	—	$	1,169.3	$	1,284.8	$	—	$	—	$	1,284.8
Zales	574.8		—		—		574.8		665.8		—		—		665.8
Jared	539.2		—		—		539.2		617.6		—		—		617.6
Digital banners (1) (2)	332.4						332.4		181.9						181.9
Diamonds Direct	181.3		—		—		181.3		219.3		—		—		219.3
Banter by Piercing Pagoda	164.8		—		—		164.8		219.2		—		—		219.2
Peoples	81.7		—		—		81.7		93.2		—		—		93.2
International segment banners	—		195.0		—		195.0		—		221.6		—		221.6
Other (3)	18.8		—		24.3		43.1		39.6		—		50.2		89.8
Total sales	$	3,062.3	$	195.0	$	24.3	$	3,281.6	$	3,321.4	$	221.6	$	50.2	$	3,593.2

(1) Includes sales from the Company’s digital banners, James Allen and Blue Nile.

(2) Includes Blue Nile sales since the date of acquisition on August 19, 2022. See Note 4 for further details.

(3) Other primarily includes sales from Signet’s diamond sourcing operation, loose diamonds and Rocksbox.

The following table provides the Company’s total sales, disaggregated by major product, for the 13 and 26 weeks ended July 29, 2023 and July 30, 2022:

	13 weeks ended July 29, 2023								13 weeks ended July 30, 2022
(in millions)	North America		International		Other		Consolidated		North America (3)		International		Other		Consolidated
Sales by product:
Bridal	$	691.0	$	44.5	$	—	$	735.5	$	742.4	$	49.2	$	—	$	791.6
Fashion	552.3		17.4		—		569.7		607.0		17.9		—		624.9
Watches	48.4		33.5		—		81.9		53.4		37.9		—		91.3
Services (1)	170.6		6.6		—		177.2		163.5		6.6		—		170.1
Other (2)	38.8		—		10.5		49.3		50.1		—		26.9		77.0
Total sales	$	1,501.1	$	102.0	$	10.5	$	1,613.6	$	1,616.4	$	111.6	$	26.9	$	1,754.9
	26 weeks ended July 29, 2023								26 weeks ended July 30, 2022
(in millions)	North America		International		Other		Consolidated		North America (3)		International		Other		Consolidated
Sales by product:
Bridal	$	1,418.7	$	85.5	$	—	$	1,504.2	$	1,543.1	$	99.3	$	—	$	1,642.4
Fashion	1,123.7		33.0		—		1,156.7		1,263.5		35.6		—		1,299.1
Watches	93.2		63.6		—		156.8		104.9		73.1		—		178.0
Services (1)	346.4		12.9		—		359.3		329.5		13.6		—		343.1
Other (2)	80.3		—		24.3		104.6		80.4		—		50.2		130.6
Total sales	$	3,062.3	$	195.0	$	24.3	$	3,281.6	$	3,321.4	$	221.6	$	50.2	$	3,593.2

(1) Services primarily includes sales from service plans, repairs and subscriptions.

(2) Other primarily includes sales from Signet’s diamond sourcing operation and other miscellaneous non-jewelry sales.

(3) Certain amounts have been reclassified between the bridal, fashion, and other categories to conform to the Company’s current product categorizations.

The following table provides the Company’s total sales, disaggregated by channel, for the 13 and 26 weeks ended July 29, 2023 and July 30, 2022:

	13 weeks ended July 29, 2023								13 weeks ended July 30, 2022
(in millions)	North America		International		Other		Consolidated		North America		International		Other		Consolidated
Sales by channel:
Store	$	1,147.1	$	84.8	$	—	$	1,231.9	$	1,314.6	$	91.9	$	—	$	1,406.5
E-commerce	348.3		17.2		—		365.5		278.1		19.7		—		297.8
Other (1)	5.7		—		10.5		16.2		23.7		—		26.9		50.6
Total sales	$	1,501.1	$	102.0	$	10.5	$	1,613.6	$	1,616.4	$	111.6	$	26.9	$	1,754.9
	26 weeks ended July 29, 2023								26 weeks ended July 30, 2022
(in millions)	North America		International		Other		Consolidated		North America		International		Other		Consolidated
Sales by channel:
Store	$	2,338.1	$	161.6	$	—	$	2,499.7	$	2,711.1	$	181.8	$	—	$	2,892.9
E-commerce	712.7		33.4		—		746.1		578.5		39.8		—		618.3
Other (1)	11.5		—		24.3		35.8		31.8		—		50.2		82.0
Total sales	$	3,062.3	$	195.0	$	24.3	$	3,281.6	$	3,321.4	$	221.6	$	50.2	$	3,593.2

(1) Other primarily includes sales from Signet’s diamond sourcing operation and loose diamonds.

Extended service plans (“ESP”)

The Company recognizes revenue related to ESP sales in proportion to when the expected costs will be incurred. The deferral periods for ESP sales are determined from patterns of claims costs, including estimates of future claims costs expected to be incurred. Management reviews the trends in claims to assess whether changes are required to the revenue and cost recognition rates utilized. A significant change in either the overall claims pattern or the life over which the Company is expected to fulfill its obligations under the warranty, could result in material change to revenues. All direct costs associated with the sale of ESP are deferred and amortized in

proportion to the revenue recognized and disclosed as either other current assets or other assets in the condensed consolidated balance sheets. These direct costs primarily include sales commissions and credit card fees.

Deferred ESP selling costs

Unamortized deferred ESP selling costs as of July 29, 2023, January 28, 2023 and July 30, 2022 were as follows:

(in millions)	July 29, 2023		January 28, 2023		July 30, 2022
Other current assets	$	28.0	$	29.2	$	27.4
Other assets	83.0		85.4		86.8
Total deferred ESP selling costs	$	111.0	$	114.6	$	114.2

Amortization of deferred ESP selling costs is included within selling, general and administrative expenses in the condensed consolidated statements of operations. Amortization of deferred ESP selling costs was $10.8 million and $21.7 million during the 13 and 26 weeks ended July 29, 2023, respectively, and $10.3 million and $21.1 million during the 13 and 26 weeks ended July 30, 2022, respectively.

Deferred revenue

Deferred revenue as of July 29, 2023, January 28, 2023 and July 30, 2022 was as follows:

(in millions)	July 29, 2023		January 28, 2023		July 30, 2022
ESP deferred revenue	$	1,138.9	$	1,159.5	$	1,131.5
Other deferred revenue (1)	88.4		90.1		69.3
Total deferred revenue	$	1,227.3	$	1,249.6	$	1,200.8
Disclosed as:
Current liabilities	$	358.3	$	369.5	$	326.9
Non-current liabilities	869.0		880.1		873.9
Total deferred revenue	$	1,227.3	$	1,249.6	$	1,200.8

(1) Other deferred revenue primarily includes revenue collected from customers for custom orders and eCommerce orders, for which control has not yet transferred to the customer.

	13 weeks ended				26 weeks ended
(in millions)	July 29, 2023		July 30, 2022		July 29, 2023		July 30, 2022
ESP deferred revenue, beginning of period	$	1,149.4	$	1,125.9	$	1,159.5	$	1,116.5
Plans sold (1)	109.7		120.3		223.1		244.1
Revenue recognized (2)	(120.2)		(114.7)		(243.7)		(229.1)
ESP deferred revenue, end of period	$	1,138.9	$	1,131.5	$	1,138.9	$	1,131.5

(1) Includes impact of foreign exchange translation.

(2) The Company recognized sales of $75.8 million and $162.5 million during the 13 and 26 weeks ended July 29, 2023, respectively, and $68.6 million and $147.8 million during the 13 and 26 weeks ended July 30, 2022, respectively, related to deferred revenue that existed at the beginning of the period in respect to ESP.