Segment Reporting

12 Months Ended

Jan. 29, 2022

Segment Reporting [Abstract]

Segment Reporting

16. Segment Reporting

In accordance with ASC 280, Segment Reporting (“ASC 280”), the Company has identified two operating segments (American Eagle brand and Aerie brand) that also represent our reportable segments and reflect the Chief Operating Decision Maker’s (defined as our CEO) internal view of analyzing results and allocating resources. Additionally, our Todd Snyder brand, Unsubscribed brand, and Supply Chain Platform have been identified as separate operating segments; however, as they do not meet the quantitative thresholds for separate disclosure, they have been included in the Corporate and Other category, as permitted by ASC 280.

Our CEO analyzes segment results and allocates resources between segments based on the adjusted operating income (loss) of each segment. Adjusted operating income (loss) is a non-GAAP financial measure ("non-GAAP" or "adjusted") that is defined by the Company as operating income excluding impairment, restructuring and COVID-19 related charges. Adjusted operating income (loss) is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to similar measures presented by other companies. Non-GAAP information is provided as a supplement to, not as a substitute for, or as superior to, measures of financial performance prepared in accordance with GAAP. We believe that this non-GAAP information is useful as an additional means for investors to evaluate our operating performance, when reviewed in conjunction with our GAAP consolidated financial statements and provides a higher degree of transparency. These amounts are not determined in accordance with GAAP and, therefore, should not be used exclusively in evaluating our business and operations. Adjusted operating income (loss) on a consolidated basis is presented in the following table to reconcile the segment operating performance measure to operating income (loss) as presented on the Consolidated Financial Statements.

Reportable segment information is presented in the following table:

(in thousands)	American Eagle		Aerie		Corporate and Other(1)			Total(2)
For the year ended January 29, 2022
Total net revenue	$	3,555,706	$	1,376,269	$	78,810		$	5,010,785
Operating income (Ioss)	$	785,729	$	212,287	$	(406,951	)	$	591,065
Asset Impairment	$	10,231	$	1,713	$	-		$	11,944
Adjusted operating income (loss)	$	795,960	$	214,000	$	(406,951	)	$	603,009
Depreciation and Amortization	$	59,641	$	33,834	$	73,306		$	166,781
Capital expenditures	$	47,106	$	80,062	$	106,679		$	233,847
For the year ended January 30, 2021
Total net revenue	$	2,733,849	$	989,989	$	35,275		$	3,759,113
Operating income (Ioss)	$	93,029	$	60,298	$	(424,672	)	$	(271,345	)
Impairment, restructuring and COVID-19 related charges	$	144,486	$	52,849	$	82,491		$	279,826
Adjusted operating income (loss)	$	237,515	$	113,147	$	(342,181	)	$	8,481
Depreciation and Amortization	$	63,019	$	26,647	$	72,736		$	162,402
Capital expenditures	$	36,606	$	32,723	$	58,646		$	127,975
For the year ended February 1, 2020
Total net revenue	$	3,479,592	$	801,035	$	27,585		$	4,308,212
Operating income (loss)	$	484,078	$	47,465	$	(298,198	)	$	233,345
Impairment and restructuring charges	$	41,657	$	20,261	$	18,576		$	80,494
Adjusted operating Income (loss)	$	525,735	$	67,726	$	(279,622	)	$	313,839
Depreciation and Amortization	$	75,889	$	22,578	$	80,583		$	179,050
Capital expenditures	$	98,699	$	56,283	$	55,378		$	210,360

(1)Corporate and Other includes revenue and operating results of the Todd Snyder brand, Unsubscribed brand, and Supply Chain Platform, which have been identified as separate operating segments, but are not material to disclose as separate reportable segments. Corporate operating costs represents certain costs that are not directly attributable to another reportable segment.

(2)The difference between Operating income (loss) and Income (loss) before income taxes includes the following, which are not allocated to our reportable segments:

- For Fiscal 2021: interest expense (income), net of $34.6 million and other income, net of $2.5 million

- For Fiscal 2020: interest expense (income), net of $24.6 million and other income, net of $3.7 million

- For Fiscal 2019: interest expense (income), net of ($6.2) million and other income, net of $5.7 million

We do not allocate assets to the reportable segment level and therefore our CEO does not use segment asset information to make decisions.

Total net revenue for the American Eagle and Aerie reportable segments in the table above represents revenue attributable to each brands merchandise which comprises approximately 98% of total net revenue.

The following tables present summarized geographical information.

	For the Years Ended
	January 29,		January 30,		February 1,
(In thousands)	2022		2021		2020
Total net revenue:
United States	$	4,336,806	$	3,295,028	$	3,710,270
Foreign (1)		673,979		464,085		597,942
Total net revenue	$	5,010,785	$	3,759,113	$	4,308,212

(1)Amounts represent sales from American Eagle and Aerie international retail stores, and e-commerce sales that are billed to and/or shipped to foreign countries and international franchise royalty revenue.

	January 29,		January 30,
(In thousands)	2022		2021
Long-lived assets, net:
United States	$	2,137,835	$	1,705,561
Foreign		157,575		144,544
Total long-lived assets, net	$	2,295,410	$	1,850,105