REVENUE
DISAGGREGATION OF NET SALES
The following table presents net sales disaggregated by product and service categories for the Retail segment and sales channel for the Brand Portfolio segment:
| | | | | | | | | | | | | | | | | |
| (in thousands) | 2025 | | 2024 | | 2023 |
| Net sales: | | | | | |
| Retail segment: | | | | | |
| Non-athletic footwear: | | | | | |
| Women's | $ | 1,219,143 | | | $ | 1,293,965 | | | $ | 1,407,446 | |
| Men's | 365,752 | | | 376,045 | | | 426,098 | |
| Kids' | 112,866 | | | 120,202 | | | 100,156 | |
| Athletic footwear | 784,997 | | | 809,019 | | | 717,462 | |
| Accessories and other | 174,051 | | | 149,893 | | | 146,916 | |
| 2,656,809 | | | 2,749,124 | | | 2,798,078 | |
| Brand Portfolio segment: | | | | | |
| Wholesale | 313,024 | | | 335,586 | | | 271,655 | |
| Direct-to-consumer | 45,058 | | | 57,610 | | | 65,724 | |
| Other | 4,779 | | | 5,685 | | | 11,597 | |
| 362,861 | | | 398,881 | | | 348,976 | |
| Total segment net sales | 3,019,670 | | | 3,148,005 | | | 3,147,054 | |
| Elimination of intersegment sales | (126,999) | | | (138,743) | | | (72,078) | |
| $ | 2,892,671 | | | $ | 3,009,262 | | | $ | 3,074,976 | |
DEFERRED REVENUE LIABILITIES
We record deferred revenue liabilities, included in accrued expenses on the consolidated balance sheets, for remaining obligations we have to our customers. The following table presents the activity related to gift cards and reward programs:
| | | | | | | | | | | | | | | | | |
| (in thousands) | 2025 | | 2024 | | 2023 |
| Gift cards: | | | | | |
| Balance at beginning of period | $ | 28,963 | | | $ | 31,662 | | | $ | 35,121 | |
| Gift cards redeemed and breakage recognized to net sales | (59,361) | | | (62,379) | | | (66,466) | |
| Gift cards issued | 58,128 | | | 59,680 | | | 63,007 | |
| Balance at end of period | $ | 27,730 | | | $ | 28,963 | | | $ | 31,662 | |
| Reward programs: | | | | | |
| Balance at beginning of period | $ | 14,126 | | | $ | 15,971 | | | $ | 16,900 | |
| Reward certificates redeemed and expired and other adjustments recognized to net sales | (26,451) | | | (30,326) | | | (31,712) | |
| Deferred revenue for reward points issued | 25,170 | | | 28,481 | | | 30,783 | |
| Balance at end of period | $ | 12,845 | | | $ | 14,126 | | | $ | 15,971 | |
CUSTOMER RETURNS AND ALLOWANCES
We reduce sales by the amount of actual and remaining expected customer returns and allowances, and cost of sales by the amount of merchandise we expect to recover. Customer allowances may be provided to our wholesale customers for margin assistance, advertising support, and various other deductions. Customer returns and allowances are estimated based on anticipated future activity using historical experience and trends and existing arrangements with customers.
The following table presents the activity related to customer returns and allowances:
| | | | | | | | | | | | | | | | | |
| (in thousands) | 2025 | | 2024 | | 2023 |
| Balance at beginning of period | $ | 18,053 | | | $ | 19,569 | | | $ | 19,337 | |
| Net sales reduced for estimated returns and allowances | 435,225 | | | 477,516 | | | 489,375 | |
| Actual returns and allowances during the period | (436,984) | | | (479,032) | | | (489,143) | |
| Balance at end of period | $ | 16,294 | | | $ | 18,053 | | | $ | 19,569 | |
As of January 31, 2026 and February 1, 2025, the asset for recovery of merchandise returns was $7.9 million and $8.9 million, respectively, and is included in prepaid expenses and other current assets on the consolidated balance sheets.
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.