Qurate Retail, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Information About Qurate Retail's Operating Segments

Information About Qurate Retail's Operating Segments

3 Months Ended

Mar. 31, 2024

Information About Qurate Retail's Operating Segments

Information About Qurate Retail's Operating Segments

(9) Information About Qurate Retail's Operating Segments

Qurate Retail, through its ownership interests in subsidiaries and other companies, is primarily engaged in the video and online commerce industries. Qurate Retail identifies its reportable segments as (A) those operating segments that represent 10% or more of its consolidated annual revenue, annual Adjusted OIBDA (as defined below) or total assets and (B) those equity method affiliates whose share of earnings represent 10% or more of Qurate Retail's annual pre-tax earnings.

The Qurate Retail chief operating decision maker primarily evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as revenue and Adjusted OIBDA. In addition, Qurate Retail reviews nonfinancial measures such as unique website visitors, number of units shipped, conversion rates and active customers, as appropriate.

For the three months ended March 31, 2024, Qurate Retail has identified the following operating segments as its reportable segments:

●

QxH – QVC U.S. and HSN market and sell a wide variety of consumer products in the U.S., primarily by means of their televised shopping programs and via the Internet through their websites and mobile applications.

●

QVC International – QVC International markets and sells a wide variety of consumer products in several foreign countries, primarily by means of its televised shopping programs and via the Internet through its international websites and mobile applications.

●

CBI – CBI consists of a portfolio of aspirational home and apparel brands in the U.S. that sell merchandise through brick-and-mortar retail locations as well as via the Internet through their websites.

Qurate Retail's operating segments are strategic business units that offer different products and services. They are managed separately because each segment requires different technologies, distribution channels and marketing strategies. The accounting policies of the segments are the same as those described in the Company's Summary of Significant Accounting Policies in the 2023 10-K.

Performance Measures

Disaggregated revenue by segment and product category consisted of the following:


		Three months ended
		March 31, 2024
			QxH	QVC Int'l	CBI	Corp and other	Total

	in millions
Home		$	589	237	189	—	1,015
Apparel			282	108	42	—	432
Beauty			239	129	—	—	368
Accessories			201	48	—	—	249
Electronics			108	15	—	—	123
Jewelry			80	33	—	—	113
Other revenue			40	2	—	—	42
Total Revenue		$	1,539	572	231	—	2,342


		Three months ended
		March 31, 2023
			QxH	QVC Int'l	CBI	Corp and other	Total

	in millions
Home		$	635	237	214	50	1,136
Apparel			295	113	45	70	523
Beauty			246	133	—	9	388
Accessories			192	51	—	50	293
Electronics			110	17	—	2	129
Jewelry			77	39	—	8	124
Other revenue			46	2	—	3	51
Total Revenue		$	1,601	592	259	192	2,644

For segment reporting purposes, Qurate Retail defines Adjusted OIBDA as revenue less cost of goods sold, operating expenses, and selling, general and administrative expenses excluding stock-based compensation and, where applicable, separately identified items impacting comparability. Qurate Retail believes this measure is an important indicator of the operational strength and performance of its businesses by identifying those items that are not directly a reflection of each business’ performance or indicative of ongoing business trends. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. This measure of performance excludes depreciation and amortization, stock-based compensation, and where applicable, separately identified impairments, litigation settlements, restructuring, penalties, acquisition-related costs, fire related costs, net (including Rocky Mount inventory losses) and gains (losses) on sale leaseback transactions, that are included in the measurement of operating income (loss) pursuant to GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income (loss), net earnings (loss), cash flows provided by operating activities and other measures of financial performance prepared in accordance with GAAP. Qurate Retail generally accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current prices.

Adjusted OIBDA is summarized as follows:


	Three months ended March 31,
		2024	2023

	amounts in millions
QxH	$	185	139
QVC International		75	72
CBI		6	4
Corporate and other		(7)	(36)
Consolidated Qurate Retail	$	259	179

Other Information


	March 31, 2024
	Total assets		Capital expenditures

	amounts in millions
QxH	$	7,840	22
QVC International		1,793	10
CBI		555	8
Corporate and other		793	—
Consolidated Qurate Retail	$	10,981	40

The following table provides a reconciliation of Adjusted OIBDA to Operating income (loss) and Earnings (loss) before income taxes:


	Three months ended
	March 31,
	2024		2023

	amounts in millions
Adjusted OIBDA	$	259	179
Stock-based compensation		(16)	(16)
Depreciation and amortization		(99)	(100)
Gain on sale of assets and sale leaseback transactions		1	113
Operating income (loss)	$	145	176
Interest expense		(117)	(94)
Interest and dividend income		12	11
Realized and unrealized gains (losses) on financial instruments, net		(7)	(32)
Other, net		(2)	4
Earnings (loss) before income taxes	$	31	65

- 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

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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+ Details