Segment Reporting

6 Months Ended

Aug. 02, 2025

The Company has two operating segments, which are also its reportable segments: VB Direct and VB Indirect. During the thirteen weeks ended May 3, 2025, the Company completed the sale of its wholly owned subsidiary, Creative Genius, also referred to as Pura Vida and was the Company's third reporting segment. Refer to Note 14 for additional information. These operating segments are components of the Company for which separate financial information is available and for which operating results are evaluated on a regular basis by the chief operating decision maker ("CODM") in deciding how to allocate resources and in assessing the performance of the segments. The Company's CODM is our Executive Chairman, who is serving as the interim Chief Executive Officer.

The VB Direct segment includes Vera Bradley full-line and outlet stores; e-commerce sites (verabradley.com, outlet.verabradley.com, and international.verabradley.com); and the Vera Bradley annual outlet sale. Revenues generated from this segment are driven through the sale of Vera Bradley-branded products from Vera Bradley to end consumers.

The VB Indirect segment represents revenues generated through the distribution of Vera Bradley-branded products to specialty retailers representing approximately 1,100 locations, substantially all of which are located in the United States; key accounts, which include department stores, national accounts, third-party e-commerce sites, and third-party inventory liquidators; and royalties recognized through licensing agreements related to the Vera Bradley brand.

Corporate costs represent the Company’s administrative expenses, which include, but are not limited to: human resources, legal, finance, information technology, design, product development, merchandising, corporate-level marketing and advertising, and various other corporate-level-activity-related expenses not directly attributable to a reportable segment. Income earned under the Transition Services Agreement ("TSA") resulting from the sale of Creative Genius is netted against these unallocated corporate expenses. All intercompany-related activities are eliminated in consolidation and are excluded from the segment reporting.

The CODM’s primary or key performance indicator for evaluating segment operating results is operating income. The CODM uses operating income for each segment predominantly in the annual budget and forecasting process. The CODM considers budget-to-actual variances on a quarterly basis for this key performance operating measure when making decisions about the allocation of operating and capital resources to each segment. The CODM also uses segment operating income to assess the performance of each segment by comparing the results of each segment with one another and in determining the compensation of certain employees. The CODM reviews cost of sales and SG&A expense on a consolidated basis.

The accounting policies of the segments are the same as those described in Note 2. The Company does not report depreciation or amortization expense, total assets, or capital expenditures by segment as such information is neither used by management nor accounted for at the segment level.

Net revenues, cost of sales, other segment expenses, and operating income information for the Company’s reportable segments, as well as a reconciliation to (loss) income from continuing operations before income taxes during the thirteen and twenty-six weeks ended August 2, 2025 and August 3, 2024, respectively, consisted of the following (in thousands):


	Thirteen Weeks Ended				Twenty-Six Weeks Ended
	August 2, 2025		August 3, 2024		August 2, 2025		August 3, 2024
Segment net revenues:
VB Direct	$	60,514	$	72,241	$	103,597	$	128,665
VB Indirect	10,344		21,762		18,913		33,286

Total	$	70,858	$	94,003	$	122,510	$	161,951
Segment cost of sales:
VB Direct	$	29,352	$	33,495	$	53,229	$	62,054
VB Indirect	6,009		13,799		11,017		19,148

Total	$	35,361	$	47,294	$	64,246	$	81,202
Other segment expenses, net (1)
VB Direct	$	21,827	$	25,313	$	46,569	$	49,185
VB Indirect	2,145		3,220		3,726		5,569

Total	$	23,972	$	28,533	$	50,295	$	54,754
Segment operating income:
VB Direct	$	9,335	$	13,433	$	3,799	$	17,426
VB Indirect	2,190		4,743		4,170		8,569

Total	$	11,525	$	18,176	$	7,969	$	25,995
Reconciliation:
Segment operating income:	$	11,525	$	18,176	$	7,969	$	25,995
Unallocated corporate expenses	$	(16,117)	$	(15,783)	$	(30,418)	$	(34,219)
Interest (expense) income	(134)		219		(130)		689
(Loss) income from continuing operations before income taxes	$	(4,726)	$	2,612	$	(22,579)	$	(7,535)
(1) Other segment expenses, net include selling, general and administrative expenses and are net of other income.

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

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+ Details

Vera Bradley, Inc. 10-Q