DULUTH HOLDINGS INC. Revenue Disclosure
The Company’s revenue primarily consists of the sale of apparel, footwear and hard goods. Revenue for merchandise that is shipped to our customers from our fulfillment centers and stores is recognized upon shipment. Store revenue is recognized at the point of sale, net of returns, and excludes taxes. Shipping and processing revenue generated from customer orders are included as a component of net sales and shipping and processing expense, including handling expense, is included as a component of selling, general and administrative expenses. Sales tax collected from customers and remitted to taxing authorities is excluded from revenue and is included in accrued expenses.
Sales disaggregated based upon sales channel is presented below.
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| February 2, 2025 |
| January 28, 2024 | ||
(in thousands) |
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Direct-to-consumer |
| $ | 419,860 |
| $ | 425,562 |
Stores |
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| 206,769 |
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| 221,119 |
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| $ | 626,629 |
| $ | 646,681 |
Contract Assets and Liabilities
The Company’s contract assets primarily consist of the right of return for amounts of inventory to be returned that are expected to be resold and are recorded in Prepaid expenses and other current assets on the Company’s Consolidated Balance Sheets. The Company’s contract liabilities primarily consist of gift card liabilities and are recorded upon issuance in Accrued expenses and other current liabilities under deferred revenue (see Note 5 “Accrued Expenses and Other Current Liabilities”) on the Company’s Consolidated Balance Sheets. Upon issuance of a gift card, a liability is established for its cash value.
Contract assets and liabilities on the Company’s Consolidated Balance Sheets are presented in the following table:
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| February 2, 2025 |
| January 28, 2024 | ||
(in thousands) |
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Contract assets |
| $ | 2,301 |
| $ | 2,778 |
Contract liabilities |
| $ | 9,782 |
| $ | 9,579 |
Revenue from gift cards is recognized when the gift card is redeemed by the customer for merchandise, or as gift card breakage, an estimate of gift cards which will not be redeemed. The Company does not record breakage revenue when escheat liability to the relevant jurisdictions exists. Gift card breakage is recorded within Net sales on the Company’s Consolidated Statement of Operations. The following table provides the reconciliation of the contract liability related to gift cards:
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| February 2, 2025 |
| January 28, 2024 | ||
(in thousands) |
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Balance as of Beginning of Period |
| $ | 9,579 |
| $ | 10,249 |
Gift cards sold |
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| 18,975 |
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| 18,116 |
Gift cards redeemed |
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| (17,173) |
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| (16,940) |
Gift card breakage |
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| (1,599) |
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| (1,846) |
Balance as of End of Period |
| $ | 9,782 |
| $ | 9,579 |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 24, 2025 | Showing above |
| 2023 | Mar 17, 2023 | |
| 2022 | Mar 25, 2022 | |
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.