What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2023-02-23 compared with 2022-02-24 · 294 added, 306 removed, 841 unchanged (42% of the section changed)

7 unchanged sentences

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Deloitte & Touche LLP

Bancorp Tower

111 Southwest Fifth Avenue

Portland, OR 97204-3642

Tel:+1 503 222 1341

+1 503 224 2172

www.deloitte.com

Report of Independent Registered Public Accounting Firm

18 unchanged sentences

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

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Intangible Assets, Net – prAna Trademark– Refer to Notes 2 and 6 to the Consolidated Financial Statements

Critical Audit Matter Description

The Company has intangible assets, including trademarks and trade names (“trademarks”).

As of December 31, 2021, the carrying value of the intangible assets was $101.9 million, of which $70.5 million was attributed to prAna’s trademark.

The Company used the relief from royalty method to estimate fair value, which requires management to make significant estimates and assumptions related to projected revenues.

The Company has trademarks and trade names (“trademarks”) that are indefinite-lived intangible assets.

As of December 31, 2022, the carrying value of the intangible assets were $81.6 million, of which $51.8 million was attributed to prAna’s trademark, after recognizing $18.7 million of impairment loss in the year ended December 31, 2022.

The Company used the relief from royalty method to estimate fair value, which requires management to make significant estimates and assumptions related to projected revenues, royalty rates and discount rates to estimate the fair value of the prAna trademark.

Auditing management’s estimates and assumptions related to projected revenues for prAna involved especially subjective judgement.

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How the Critical Audit Matter Was Addressed in the Audit

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• We evaluated management’s ability to accurately forecast future revenues by comparing actual results to management’s historical forecasts.

• We evaluated the reasonableness of management’s revenues forecasts by comparing the forecasts to:

• We evaluated the reasonableness of management’s revenue forecasts by comparing the forecasts to:

◦ Historical revenues.

◦ Forecasted information included in Company press releases as well as in analyst and industry reports for the Company and certain of its peer companies.

• We evaluated the inputs used in the forecast and the basis for the assumptions made by management.

• We evaluated the impact of changes in management’s forecasts from the October 31, 2021 annual measurement date to December 31, 2021.

Long-lived Asset Valuation – Refer to Notes 2, 5 and 9 to the Consolidated Financial Statements

• To evaluate the reasonableness of the (1) discount rate and (2) royalty rate, with the assistance of our fair value specialists, we:

◦ Developed a range of independent estimates of the discount rate and compared those to the discount rate selected by management to assess the appropriateness of the discount rate assumption.

◦ Tested the inputs and source information underlying the determination of the discount rate by comparing to reputable third-party data or industry information and tested the mathematical accuracy of the calculation.

◦ Testing the source information underlying the determination of the royalty rate selected by management and compared the selected royalty rates from royalty agreements in the outdoor apparel industry for comparable companies and the Company's own contract royalty rates.

Goodwill – prAna Goodwill – Refer to Notes 2 and 6 to the Consolidated Financial Statements

Critical Audit Matter Description

The Company evaluates retail location long-lived assets for impairment when events or changes in circumstances exist that may indicate that the carrying amounts of retail location long-lived assets are no longer recoverable.

Events that result in an impairment review include plans to close a retail location or a significant decrease in the operating results of the retail location.

When such an indicator occurs, the Company evaluates its retail location long-lived assets for impairment by comparing the undiscounted future cash flow expected to be generated by the location to the location long-lived asset’s carrying amount.

If the carrying amount of an asset exceeds the estimated undiscounted future cash flow, an analysis is performed to estimate the fair value of the asset.

An impairment is recorded if the fair value of the retail location long-lived asset is less than the carrying amount.

The Company makes significant assumptions to evaluate retail location long-lived assets for possible indications of impairment.

Changes in these assumptions could have a significant impact on the retail location long-lived assets identified for further analysis.

For the year ended December 31, 2021, impairment charges from underperforming retail location long-lived assets were immaterial.

Given the Company’s evaluation of possible indications of impairment of retail location long-lived assets requires management to make significant assumptions, performing audit procedures to evaluate whether management appropriately identified events or changes in circumstances indicating that the carrying amounts of retail location long-lived assets may not be recoverable involved especially subjective judgment.

The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to its carrying value.

The goodwill balance was $51.7 million as of December 31, 2022, of which $37.3 million was allocated to the prAna Reporting Unit (“prAna”), after recognizing $16.9 million of impairment loss in the year ended December 31, 2022.

The Company used a combination of discounted cash flow analysis and market-based valuation methods, which requires management to make significant estimates and assumptions related to projected revenues, discount rates, market-based multiples, and other operating performance measures.

Changes in these assumptions could have a significant impact on either the fair value, the amount of any goodwill impairment charge, if any, or both.

Auditing management’s estimates and assumptions related to projected revenues, discount rate and market multiples for prAna involved especially subjective judgment.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the evaluation of retail location long-lived assets for possible indications of impairment included the following, among others:

Our audit procedures for management’s estimates and assumptions related to projected revenues, for the prAna Goodwill valuation included the following, among others:

• We tested the effectiveness of internal controls over the prAna goodwill impairment analysis, including those over the forecast of future revenues, the selection of the discount rate and market-based multiples.

• We evaluated management’s ability to accurately forecast revenues by comparing actual results to management’s historical forecasts.

• We evaluated the reasonableness of management’s revenue forecasts by comparing the forecasts to:

◦ Historical revenues.

◦ Forecasted information included in Company press releases as well as in analyst and industry reports for the Company and certain of its peer companies.

• To evaluate the reasonableness of the discount rate, with the assistance of our fair value specialists, we:

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• We tested the effectiveness of the controls over management's identification of possible circumstances that may indicate that the carrying amounts of retail location long-lived assets are no longer recoverable.

• We evaluated management's impairment analysis by:

◦ Testing retail location long-lived assets for possible indications of impairment, including searching for locations with a history of losses, current period loss, or projected losses.

◦ Performing inquiries of management regarding the process and assumptions used to identify potential indicators of impairment and evaluating the consistency of the assumptions with evidence obtained in other areas of the audit.

◦ Developed a range of independent estimates of the discount rate and compared those to the discount rate by comparing to reputable third-party data or industry information and tested the mathematical accuracy of the calculation.

• With the assistance of our fair value specialists, we evaluated the reasonableness of the market multiple management applied to the projected revenues as part of their market-based valuation method through comparison to valuation multiples for guideline public companies.

/s/ DELOITTE & TOUCHE LLP

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Deloitte & Touche LLP

Bancorp Tower

111 Southwest Fifth Avenue

Portland, OR 97204-3642

Tel:+1 503 222 1341

+1 503 224 2172

www.deloitte.com

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

CONSOLIDATED BALANCE SHEETS

5 unchanged sentences

547,561 487,803

Inventories, net 645,379 556,530

Inventories 1,028,545 645,379

Prepaid expenses and other current assets 129,872 86,306

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF OPERATIONS

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Selling, general and administrative expenses 1,304,394 1,180,323 1,081,448

Impairment of goodwill and intangible assets 35,600 — 17,500

Net licensing income 22,020 18,372 12,108

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

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Other comprehensive income (loss):

Unrealized holding gains on available-for-sale securities, net — 4 56

Unrealized holding gains (losses) on derivative transactions (net of tax effects of $( 7,138 ), $ 6,271 , and $ 830 , respectively)

Change in available-for-sale securities

Change in derivative transactions (net of tax effects of $( 4,358 ), $( 7,138 ), and $ 6,271 , respectively)

11,876 19,283 ( 18,851 )

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF CASH FLOWS

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Net income $ 311,440 $ 354,108 $ 108,013

Adjustments to reconcile net income to net cash provided by operating activities:

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Depreciation, amortization, and non-cash lease expense 117,399 115,571 146,601

Provision for uncollectible accounts receivable ( 2,044 ) ( 10,758 ) 19,156

Loss on disposal or impairment of intangible assets, property, plant and equipment, and right-of-use assets 1,233 31,342 5,442

Loss on disposal or impairment of investments, property, plant and equipment, right-of-use assets, goodwill, and intangible assets 38,194 1,233 31,342

Deferred income taxes ( 8,118 ) ( 9,798 ) ( 11,263 )

2 unchanged sentences

Accounts receivable ( 64,495 ) ( 31,622 ) 22,885

Inventories, net ( 100,261 ) 64,884 ( 84,058 )

Inventories ( 399,851 ) ( 100,261 ) 64,884

Prepaid expenses and other current assets ( 25,749 ) ( 24,858 ) 33,712

5 unchanged sentences

Other liabilities ( 3,055 ) ( 1,112 ) 8,613

Net cash provided by operating activities 354,406 276,077 285,452

Net cash provided by (used in) operating activities ( 25,241 ) 354,406 276,077

Cash flows from investing activities:

10 unchanged sentences

Repurchase of common stock ( 287,443 ) ( 165,415 ) ( 132,889 )

Purchase of non-controlling interest — — ( 17,880 )

Cash dividends paid ( 75,082 ) ( 68,623 ) ( 17,195 )

10 unchanged sentences

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF EQUITY

Columbia Sportswear Company Shareholders' Equity

(in thousands, except per share amounts) Common Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Non-Controlling Interest Total

(in thousands, except per share amounts) Common Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Total

Outstanding Amount

Balance, January 1, 2019

Balance, December 31, 2019

67,561 $ 4,937 $ 1,848,935 $ ( 4,425 ) $ 1,849,447

Net income — — 108,013 — 108,013

Purchase of non-controlling interest — — — ( 99 ) ( 16,456 ) ( 16,555 )

Other comprehensive income (loss) — — — 5,231 5,231

Unrealized holding gains on available-for-sale securities, net — — — 56 — 56

Unrealized holding losses on derivative transactions, net — — — ( 2,383 ) — ( 2,383 )

Foreign currency translation adjustment, net — — — 2,064 — 2,064

Cash dividends ($ 0.26 per share)

8 unchanged sentences

Other comprehensive income (loss) — — — ( 5,182 ) ( 5,182 )

Unrealized holding gains on available-for-sale securities, net — — — 4 — 4

Unrealized holding losses on derivative transactions, net — — — ( 18,851 ) — ( 18,851 )

Foreign currency translation adjustment, net — — — 24,078 — 24,078

Cash dividends ($ 1.04 per share)

8 unchanged sentences

Other comprehensive income (loss) — — — ( 26,261 ) ( 26,261 )

Unrealized holding gains on derivative transactions, net — — — 19,283 — 19,283

Foreign currency translation adjustment, net — — — ( 24,465 ) — ( 24,465 )

Cash dividends ($ 1.20 per share)

8 unchanged sentences

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I ndex to Notes to Consolidated Financial State ments

INDEX TO NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Notes to Consolidated Financial Statements

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 Basis of Presentation and Organization 44

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

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NATURE OF THE BUSINESS

Columbia Sportswear Company connects active people with their passions through its four well-known brands, Columbia, SOREL, Mountain Hardwear, and prAna, by designing, developing, marketing, and distributing its outdoor, active and everyday lifestyle apparel, footwear, accessories, and equipment products to meet the diverse needs of its customers and consumers.

Columbia Sportswear Company connects active people with their passions through its four well-known brands, Columbia, SOREL, Mountain Hardwear, and prAna, by designing, developing, marketing, and distributing its outdoor, active and lifestyle apparel, footwear, accessories, and equipment products to meet the diverse needs of its customers and consumers.

PRINCIPLES OF CONSOLIDATION

The consolidated financial statements include the accounts of Columbia Sportswear Company, its wholly owned subsidiaries and entities in which it maintained a controlling financial interest (the "Company").

The consolidated financial statements include the accounts of the Columbia Sportswear Company, its wholly owned subsidiaries and entities in which it maintained a controlling financial interest (the "Company").

All significant intercompany balances and transactions have been eliminated in consolidation.

RECLASSIFICATIONS

Certain amounts in prior period consolidated financial statements have been reclassified to conform to our current period presentation.

ESTIMATES AND ASSUMPTIONS

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.

Actual results may differ from these estimates and assumptions.

The Company's significant estimates relate to sales reserves;

allowance for uncollectible accounts receivable;

obsolescence reserves for excess;

close-out and slow-moving inventory;

impairment of long-lived assets, intangible assets and goodwill;

and income taxes.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

Effective January 1, 2021, the Company adopted Accounting Standards Update (“ASU”) No.

2019-12, Income Taxes (Topic 740):

Simplifying the Accounting for Income Taxes issued by the Financial Accounting Standards Board (“FASB”) in December 2019, which, among other things, removes specific exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods, as well as targeted impacts to the accounting for taxes under hybrid tax regimes.

At adoption there was not a material impact to the Company's financial position, results of operations or cash flows.

The Company's significant estimates relate to sales reserves, allowance for uncollectible accounts receivable, excess, close-out and slow-moving inventory, impairment of long-lived assets, intangible assets and goodwill, and income taxes.

NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

CASH AND CASH EQUIVALENTS

Cash and cash equivalents are stated at fair value or at cost, which approximates fair value, and include investments with original maturities of 90 days or less at the date of acquisition.

At December 31, 2021, Cash and cash equivalents consisted of cash and money market funds.

At December 31, 2020, Cash and cash equivalents consisted of cash, money market funds, and United States government treasury bills.

At December 31, 2021, Short-term investments consisted of United States government treasury bills as well as money market funds and mutual fund shares held as part of the Company's deferred compensation plan expected to be distributed in the next twelve months.

At December 31, 2020 , Short-term investments consisted of money market funds and mutual fund shares held as part of the Company's deferred compensation plan expected to be distributed in the next twelve months.

Investments held as part of the Company's deferred compensation plan are classified as trading securities and are recorded at fair value with any unrealized gains and losses included in SG&A expense .

Realized gains or losses from these trading securities are determined based on the specific identification method and are included in SG&A expense .

At December 31, 2021 and 2020 , long-term investments included in Other non-current assets consisted of money market funds and mutual fund shares held to offset liabilities to participants in the Company's deferred compensation plan.

The investments are classified as long-term

Cash and cash equivalents are stated at fair value or at cost, which approximates fair value, and include short-term highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity they present insignificant risk of changes in value because of changes in interest rates.

As of December 31, 2022 and December 31, 2021, Cash and cash equivalents consisted of cash and money market funds.

As of December 31, 2022, Short-term investments consisted of money market funds and mutual fund shares held as part of the Company's deferred compensation plan expected to be distributed in the next twelve months.

As of December 31, 2021 , Short-term investments consisted of United States government treasury bills as well as money market funds and mutual fund shares held as part of the Company's deferred compensation plan expected to be distributed in the next twelve months.

The United States government treasury bills are classified as available-for-sale securities and are recorded at fair value with any unrealized gains or losses reported, net of tax, in Other comprehensive income (loss) .

Realized gains or losses from these trading securities are determined based on the specific identification method and are included in SG&A expenses .

As of December 31, 2022 and 2021, long-term investments included in Other non-current assets consisted of money market funds and mutual fund shares held to offset liabilities to participants in the Company's deferred compensation plan.

These investments are classified as long-term because the related deferred compensation liabilities are not expected to be paid within the next year.

These investments are classified as trading securities and are recorded at fair value with unrealized gains and losses reported as SG&A expenses .

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I ndex to Notes to Consolidated Financial State ments

because the related deferred compensation liabilities are not expected to be paid within the next year.

These investments are classified as trading securities and are recorded at fair value with unrealized gains and losses reported as a component of operating income.

Notes to Consolidated Financial Statements

ACCOUNTS RECEIVABLE

Accounts receivable have been reduced by an allowance for doubtful accounts.

The Company maintains the allowance for estimated losses resulting from the inability of the Company's customers to make required payments.

The Company maintains an allowance for estimated credit losses resulting from the inability of the Company's customers to make required payments.

The allowance represents the current estimate of lifetime expected credit losses over the remaining duration of existing accounts receivable considering current market conditions and supportable forecasts when appropriate.

2 unchanged sentences

Inventories consist primarily of finished goods and are carried at the lower of cost or net realizable value.

Cost is determined using the first-in, first-out method.

Cost is determined using standard cost, which approximates the first-in, first-out method.

The Company periodically reviews its inventories for excess, close-out or slow-moving items and makes provisions as necessary to properly reflect inventory value.

16 unchanged sentences

CLOUD COMPUTING ARRANGEMENTS

The Company’s cloud computing arrangements ("CCAs") primarily relate to various enterprise resource planning systems, as well as other supporting systems.

These assets are generally included in Other non-current assets in the Consolidated Balance Sheets and amortized on a straight-line basis over their assessed useful lives or the term of the underlying cloud computing hosting contract, whichever is shorter.

As of December 31, 2021, CCAs in-service have useful lives which range from approximately ten months to five years.

At December 31, 2021, and 2020 CCA assets consisted of capitalized implementation costs of $ 26.6 million and $ 24.3 million, respectively and associated accumulated amortization of $ 6.8 million and $ 1.9 million, respectively.

The Company’s cloud computing arrangements that are service contracts ("CCAs") primarily relate to various enterprise resource planning systems, as well as other supporting systems.

Implementation costs associated with CCAs are capitalized ("CCA assets") when incurred during the application development stage and generally included in Other non-current assets in the Consolidated Balance Sheets.

CCA assets are amortized on a straight-line basis over their assessed useful lives or the contractual term of the CCA contract, whichever is shorter, with amortization included in the same financial statement line item in the Consolidated Statement of Operations as the expense for fees in the associated CCA contract.

As of December 31, 2022, CCA assets in-service have useful lives which range from approximately ten months to six years.

As of December 31, 2022 and 2021, CCA assets consisted of capitalized implementation costs of $ 36.0 million and $ 26.6 million, respectively and associated accumulated amortization of $ 12.6 million and $ 6.8 million, respectively.

Changes in these assets are recorded in Other assets within operating activities in the Consolidated Statements of Cash Flows.

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

Certain lease agreements also contain lease incentives, such as tenant improvement allowances and rent holidays.

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The Company recognizes lease expense for these leases on a straight-line basis over the lease term.

In April 2020, the FASB issued a Staff Q&A, Topic 842 and 840:

Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic.

The FASB staff indicated that it would be acceptable for entities to make an election to account for lease concessions related to the effects of the COVID-19 pandemic consistent with how they would be accounted for as though enforceable rights and obligations for those concessions existed in the original contract.

The Company elected to account for lease concessions related to the effects of the COVID-19 pandemic in accordance with the Staff Q&A.

For concessions that provide a deferral of payments with no substantive changes to the consideration in the original contract, the Company continues to recognize expense during the deferral period.

For concessions in the form of lease abatements, the reduced lease payments are accounted for as reductions to variable lease expense.

For lease concessions related to the effects of the COVID-19 pandemic that provide a deferral of payments with no substantive changes to the consideration in the original contract, the Company continues to recognize expense during the deferral period.

For concessions related to the effects of the COVID-19 pandemic in the form of lease abatements, the reduced lease payments are accounted for as reductions to variable lease expense.

IMPAIRMENT OF LONG-LIVED ASSETS, INTANGIBLE ASSETS AND GOODWILL

Long-lived assets, which include property, plant and equipment, lease ROU assets, capitalized implementation costs for cloud computing arrangements, and intangible assets with finite lives, are measured for impairment only when events or circumstances indicate the carrying value may be impaired.

Long-lived assets, which include property, plant and equipment, lease ROU assets, capitalized implementation costs for cloud computing arrangements, and intangible assets with finite lives, are tested for recoverability only when events or circumstances indicate the carrying value may not be recoverable.

In these cases, the Company estimates the future undiscounted cash flows to be derived from the asset or asset group to determine whether a potential impairment exists.

If the sum of the estimated undiscounted cash flows is less than the carrying value of the asset, the Company recognizes an impairment loss, measured as the amount by which the carrying value exceeds the estimated fair value of the asset.

The Company reviews and tests its intangible assets with indefinite lives and goodwill for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that the carrying amount of such assets may be impaired.

The Company's intangible

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I ndex to Notes to Consolidated Financial State ments

assets with indefinite lives consist of trademarks and trade names.

If the sum of the estimated undiscounted cash flows is less than the carrying value of the asset or asset group, the Company recognizes an impairment loss, measured as the amount by which the carrying value exceeds the estimate of fair value.

The Company reviews and tests its intangible assets with indefinite lives and goodwill for impairment in the fourth quarter of each year and when events or changes in circumstances indicate that it is more likely than not that the fair value of the asset or reporting unit is less than its carrying amount.

The Company's intangible assets with indefinite lives consist of trademarks and trade names.

In the impairment test for goodwill, the estimated fair value of the reporting unit is compared with the carrying amount of that reporting unit.

1 unchanged sentence

For goodwill and trademarks and trade names, if the carrying amount exceeds its estimated fair value, the Company calculates an impairment as the excess of carrying amount over the estimate of fair value.

Impairment charges, if any, are classified as a component of SG&A expense .

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Notes to Consolidated Financial Statements

Impairment charges of long-lived assets, if any, are classified as SG&A expenses .

Impairment charges of goodwill and indefinite-lived intangible assets, if any, are classified as Impairment of goodwill and intangible assets in the Consolidated Statements of Operations.

Income taxes are based on amounts of taxes payable or refundable in the current year and on expected future tax consequences of events that are recognized in the financial statements in different periods than they are recognized in tax returns.

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In making this determination, the Company assumes that the taxing authority will examine the position and that it will have full knowledge of all relevant information.

Changes in the Company's assessment may result in the recognition of a tax benefit or an additional charge to the tax provision in the period our assessment changes.

The effective portion of changes in fair values of outstanding cash flow hedges is recorded in Other comprehensive income (loss) until earnings are affected by the hedged transaction, and any ineffective portion is included in current income.

In most cases, amounts recorded in Other comprehensive income (loss) will be released to earnings after maturity of the related derivative.

Changes in the Company's assessment may result in the recognition of a tax benefit or an additional charge to the tax provision in the period the assessment changes.

The effective portion of changes in fair values of outstanding cash flow hedges is recorded in Accumulated other comprehensive income (loss) until earnings are affected by the hedged transaction, and any ineffective portion is included in earnings.

In most cases, amounts recorded in Accumulated other comprehensive income (loss) will be released to earnings after maturity of the related derivative.

The Consolidated Statements of Operations classification of effective hedge results is the same as that of the underlying exposure.

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For the Company's subsidiaries whose functional currency is not the United States dollar, assets and liabilities have been translated into United States dollars using the exchange rates in effect at period end, and the sales and expenses have been translated into United States dollars using average exchange rates in effect during the period.

The foreign currency translation adjustments are included as a separate component of Accumulated other comprehensive income (loss) in the Consolidated Balance Sheets.

The foreign currency translation adjustments are included as a component of Accumulated other comprehensive income (loss) in the Consolidated Balance Sheets.

REVENUE RECOGNITION

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Within the Company's direct-to-consumer ("DTC") channel, control generally transfers to the consumer at the time of sale within retail stores and concession-based arrangements and generally upon shipment to the consumer with respect to e-commerce transactions.

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I ndex to Notes to Consolidated Financial State ments

The amount of consideration the Company expects to be entitled to receive and recognize as Net sales across both wholesale and DTC channels varies with changes in sales returns and other accommodations and incentives offered.

The amount of consideration the Company expects to be entitled to receive and recognize as Net sales across both wholesale and DTC channels varies with changes in sales returns, other accommodations and incentives offered.

The Company estimates expected sales returns and other accommodations, such as chargebacks and markdowns, and records a sales reserve to reduce Net sales.

These estimates are based on historical rates of product returns and claims, as well as events and circumstances that indicate changes to such historical rates.

However, actual returns and claims in any future period are inherently uncertain and thus may differ from the estimates.

As a result, the Company adjusts estimates of revenue at the earlier of when the most likely amount of consideration the Company expects to receive changes or when the amount of consideration becomes fixed.

However, actual returns and claims in any future period are inherently uncertain and thus may differ from estimates.

As a result, the

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Notes to Consolidated Financial Statements

Company adjusts estimates of revenue at the earlier of when the most likely amount of consideration the Company expects to receive changes or when the amount of consideration becomes fixed.

If actual or expected future returns and claims are significantly greater or lower than the sales reserves established, the Company records an adjustment to Net sales in the period in which it made such determination.

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Shipping and Handling Costs

The Company treats shipping and handling activities as fulfillment costs, and as such recognize the costs for these activities at the time related revenue is recognized.

The majority of these costs, typically associated with warehousing and handling of inventory, are generally recorded as SG&A expenses , while the direct costs associated with shipping goods to customers and consumers are recorded as Costs of sales .

The Company treats shipping and handling activities as fulfillment costs, and as such recognizes the costs for these activities at the time the related revenue is recognized.

Shipping and handling fees billed to customers are recorded as Net sales .

Shipping and handling costs recorded as a component of SG&A expenses and were $ 114.4 million , $ 98.0 million and $ 89.2 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Shipping and handling costs recorded as a component of SG&A expenses were $ 155.8 million, $ 114.4 million and $ 98.0 million for the years ended December 31, 2022, 2021 and 2020, respectively.

COST OF SALES

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STOCK-BASED COMPENSATION

Stock-based compensation cost is estimated at the grant date based on the award's fair value and is recorded as expense when recognized.

For stock options and service-based restricted units, stock-based compensation cost is recognized over the expected requisite service period using the straight-line attribution method.

Stock-based compensation cost is estimated at the grant date based on the award's fair value.

For stock options and service-based restricted stock units, stock-based compensation cost is recognized over the expected requisite service period using the straight-line attribution method.

For performance-based restricted stock units, stock-based compensation cost is recognized based on the Company's assessment of the probability of achieving performance targets in the reporting period.

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Cooperative advertising costs are expensed when the related revenues are recognized and included in SG&A expenses .

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I ndex to Notes to Consolidated Financial State ments

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In November 2021, the FASB issued ASU No.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

The Company adopted ASU No.

2021-10 (“ASU 2021-10”), Government Assistance (Topic 832):

Disclosures by Business Entities about Government Assistance, to increase transparency of government assistance including the disclosure of (1) the types of assistance, (2) an entity’s accounting for the assistance, and (3) the effect of the assistance on an entity’s financial statements.

ASU 2021-10 is effective for annual periods beginning after December 15, 2021.

Early adoption is permitted.

The impact of this new standard will depend on the amount of future government assistance received, if any.

Disclosures by Business Entities about Government Assistance, effective January 1, 2022, using the prospective method of adoption.

ASU 2021-10 increases transparency of government assistance received by a business entity by requiring annual disclosure of (1) the types of assistance, (2) an entity’s accounting for the assistance, and (3) the effect of the assistance on an entity’s financial statements.

ASU 2021-10 was effective for annual periods beginning after December 15, 2021.

At adoption, there was not a material impact to the Company's consolidated financial statements.

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Notes to Consolidated Financial Statements

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED

NOTE 3 — REVENUES

2 unchanged sentences

United States ("U.S."), Latin America and Asia Pacific ("LAAP"), Europe, Middle East and Africa ("EMEA") and Canada.

The following tables disaggregate our operating segment Net sales by product category and channel, which the Company believes provides a meaningful depiction how the nature, timing, and uncertainty of Net sales are affected by economic factors:

The following tables disaggregate the Company's operating segment Net sales by product category and channel, which the Company believes provides a meaningful depiction of how the nature, timing, and uncertainty of Net sales are affected by economic factors:

Year Ended December 31, 2022

7 unchanged sentences

Wholesale $ 1,114,337 $ 225,932 $ 364,598 $ 162,773 $ 1,867,640

DTC 1,076,501 250,051 64,956 74,535 1,466,043

Direct-to-consumer 1,187,909 247,934 73,956 86,713 1,596,512

Total $ 2,302,246 $ 473,866 $ 438,554 $ 249,486 $ 3,464,152

8 unchanged sentences

Wholesale $ 983,799 $ 215,448 $ 317,104 $ 144,008 $ 1,660,359

DTC 765,395 226,406 49,746 56,747 1,098,294

Direct-to-consumer 1,076,501 250,051 64,956 74,535 1,466,043

Total $ 2,060,300 $ 465,499 $ 382,060 $ 218,543 $ 3,126,402

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

Year Ended December 31, 2020

7 unchanged sentences

Wholesale 838,388 198,083 249,161 117,628 $ 1,403,260

DTC 893,707 256,893 54,725 54,357 1,259,682

Direct-to-consumer 765,395 226,406 49,746 56,747 1,098,294

Total $ 1,603,783 $ 424,489 $ 298,907 $ 174,375 $ 2,501,554

3 unchanged sentences

CONTRACT BALANCES

As of December 31, 2021 and 2020, contract liabilities included in Accrued Liabilities on the Consolidated Balance Sheets, which consisted of obligations associated with the Company's gift card and customer loyalty programs, were not material.

As of December 31, 2022 and 2021, the Company did not have contract assets and had an immaterial amount of contract liabilities included in Accrued liabilities on the Consolidated Balance Sheets.

NOTE 4 — CONCENTRATIONS

TRADE RECEIVABLES

The Company had one customer that accounted for approximately 14.3 % and 14.3 % of Accounts receivable, net at December 31, 2021 and 2020, respectively.

The Company had one customer that accounted for approximately 13.8 % and 14.3 % of Accounts receivable, net as of December 31, 2022 and 2021, respectively.

No single customer accounted for 10% or more of Net sales for any of the years ended December 31, 2022, 2021 or 2020.

13 unchanged sentences

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I ndex to Notes to Consolidated Financial State ments

Impairment charges for property, plant and equipment are included in SG&A expense and were $ 0.5 million, $ 5.0 million, and $ 0.4 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Notes to Consolidated Financial Statements

Impairment charges for Property, plant and equipment, net are inclu ded in SG&A expenses an d were $ 0.8 million, $ 0.5 million, and $ 5.0 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Charges during the years ended December 31, 2022, 2021 and 2020 were recorded primarily for certain underperforming retail stores in the U.S., EMEA and LAAP regions.

NOTE 6 — INTANGIBLE ASSETS, NET AND GOODWILL

INTANGIBLE ASSETS, NET

Intangible assets, net consisted of the following:

12 unchanged sentences

Amortization expense for intangible assets subject to amortization was $ 1.7 million, $ 1.7 million and $ 2.5 million for the years ended December 31, 2022, 2021 and 2020 respectively.

Impairment charges for intangible assets with indefinite lives are included in SG&A expense.

For the year ended December 31, 2021 and 2019, there were no impairments recorded for intangible assets with indefinite lives.

For the year ended December 31, 2020, an impairment charge of $ 17.5 million was recorded.

The impairment of the prAna trademark and trade name intangible asset was determined as part of the annual impairment test.

The fair value was estimated using a relief from royalty method under the income approach.

For the year ended December 31, 2022, an im pairment charge of $ 18.7 million was recorded for the impairment of prAna's trademar k and trade name (collectively, "trademark"), which is an indefinite-lived intangible asset recorded in the U.S.

The impairment of the prAna trademark was determined as part of the annual impairment test.

The decline in estimated fair value from the fourth quarter 2021 impairment test reflects a decline in forecasted revenue, a lower estimated royalty rate, and a slightly higher discount rate.

For the year ended December 31, 2021 , there were no impairments recorded for intangible assets with indefinite lives.

For the year ended December 31, 2020, an impairment charge of $ 17.5 million was recorded for the impairment of prAna's trademark.

The impairment of the prAna trademark was determined as part of the annual impairment test.

The decline in estim ated fair value from the fourth quarter 2020 impairment test compared to the fourth quarter 2019 impairment test reflected a lower estimated royalty rate and a decline in forecasted revenues.

The Company estimated fair value using a relief from royalty method under the income approach.

Cash flow projections were developed in part from the Company's annual planning process.

The discount rate was the estimated weighted-average costs of capital of the reporting unit from a market-participant perspective.

The decline in estimated fair value from the fourth-quarter 2020 impairment test compared to the fourth-quarter 2019 impairment test reflected a lower estimated royalty rate and a decline in forecasted revenues.

Substantially all of the Company's goodwill is recorded in the U.S.

The Company determined that goodwill was not impaired for the years ended December 31, 2021, 2020, and 2019.

The following table presents the estimated annual amortization expense for the years 2022 through 2026:

The discount rate was the equity component of the estimated weighted average cost of capital of the reporting unit from a market-participant perspective.

The following table presents the remaining estimated annual amortization expense of intangible assets with definite lives for the years 2023 through 2027:

(in thousands)

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I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

The following table sets forth the changes in Goodwill .:

(in thousands)

Balance as of December 31, 2020

Gross $ 73,208

Accumulated impairment loss ( 4,614 )

Carrying value 68,594

Balance as of December 31, 2021

Accumulated impairment loss ( 4,614 )

Carrying value 68,594

Impairment losses during the year ( 16,900 )

Balance as of December 31, 2022

Accumulated impairment loss ( 21,514 )

Carrying value $ 51,694

Substantially all of the Company's goodwill is recorded in the U.S.

For the y ear ended December 31, 2022 , an impairment charge of $ 16.9 million was recorded.

The impairment of goodwill attributable to the prAna business was determined as part of the annual impairment test.

The Company estimated the fair value of the prAna reporting unit using a combination of discounted cash flow analysis and market-based valuation methods.

Key assumptions used in the discounted cash flow models are cash flow projections and the discount rate.

Cash flow projections are developed in part from our annual planning process.

The discount rate is the estimated weighted-average costs of capital of the reporting unit from a market-participant perspective.

The market-based valuation methods to estimate fair value of the reporting units utilized market multiples for guideline public companies .

The decline in estimated fair value from the fourth-quarter 2021 impairment test reflects lower assumed revenue and operating income levels, while the weighted-average cost of capital used in the discounted cash flow model remained relatively unchanged.

The Company determined that goodwill was not impaired for the years ended December 31, 2021 and 2020.

NOTE 7 — SHORT-TERM BORROWINGS AND CREDIT LINES

DOMESTIC CREDIT FACILITY

The Company has an unsecured, committed revolving credit facility that provides for funding up to $ 500.0 million.

This credit agreement matures on December 30, 2025.

Interest, payable monthly, is based on the Company's option of either LIBOR plus an applicable margin or a base rate.

The Company has an unsecured, committed revolving credit facility (the “Credit Facility”) that provides for up to $ 500.0 million of borrowings, which is available for working capital and general corporate purposes, including a sublimit for the issuance of letters of credit.

The Credit Facility matures on July 12, 2027.

Interest, generally payable monthly, is based on the Company's option of either the secured overnight financing rate (“SOFR”) plus an applicable margin or a base rate.

Base rate is defined as the highest of the following, plus an applicable margin:

• the administrative agent's prime rate;

• the higher of the federal funds rate or the overnight bank funding rate set by the Federal Reserve Bank of New York, plus 0.50%;

• the one-month LIBOR plus 1.00%.

This credit agreement requires the Company to comply with certain financial covenants covering the Company's funded debt ratio and asset coverage ratio.

The credit agreement also includes customary covenants that, among other things, limit or restrict the ability of the Company and its subsidiaries to incur additional indebtedness and liens, engage in mergers, acquisitions and dispositions, and engage in transactions with affiliates, as well as restrict certain payments, including dividends and share buybacks.

At December 31, 2021 and 2020, the Company was in compliance with all associated covenants and there was no balance outstanding.

INTERNATIONAL CREDIT FACILITY

The Company's European subsidiary has available an unsecured, committed line of credit, which are guaranteed by the Company, and provides for borrowing up to a maximum of € 4.4 million (approximately US$ 5.0 million) at December 31, 2021, with borrowings to accrue interest at a base rate plus 75 basis points.

At December 31, 2021 and 2020, there was no balance outstanding.

• the higher of the federal funds rate or overnight bank funding rate set by the Federal Reserve Bank of New York, plus 0.50%;

• the one-month SOFR plus 1.00%.

The applicable margin for SOFR loans will range from 1.00% to 1.50% based on the Company’s funded debt ratio.

The applicable margin for base rate loans will range from 0.00% to 0.50% based on the Company’s funded debt ratio.

A commitment fee ranging from 0.10% to 0.20% based on the Company's funded debt ratio is paid quarterly on the average daily unused commitment amount of the Credit Facility.

The agreement for the Credit Facility requires the Company to comply with a financial covenant to maintain a certain funded debt ratio.

In addition, the agreement includes customary covenants that, among other things, limit or restrict the ability of the Company and its subsidiaries to incur additional indebtedness and liens, engage in mergers, acquisitions and dispositions, and engage in transactions with

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Notes to Consolidated Financial Statements

affiliates, as well as restrict the amount of certain payments, including dividends and share buybacks in the event the Company's funded debt ratio is greater than a set amount.

As of December 31, 2022, the Company was in compliance with all associated covenants and there was no balance outstanding under the Credit Facility.

As of December 31, 2021 there was no balance outstanding under the credit agreement in effect for such period.

INTERNATIONAL CREDIT FACILITIES

The Company's European subsidiary has available an unsecured, committed line of credit, which is guaranteed by the Company, and provides for borrowing up to a maximum of € 4.4 million (approximately US$ 4.7 million) as of December 31, 2022, with borrowings to accrue interest at a base rate plus 75 basis points.

As of December 31, 2022 and 2021 there was no balance outstanding.

NOTE 8 — ACCRUED LIABILITIES

8 unchanged sentences

$ 328,759 $ 316,485

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I ndex to Notes to Consolidated Financial State ments

A reconciliation of product warranties is as follows:

14 unchanged sentences

$ 145,962 $ 145,353 $ 172,897

For the year ended December 31, 2021, operating lease costs included $ 0.5 million of ROU impairment charges related to underperforming retail locations, as well as a gain of $ 8.6 million from the completion of lease termination negotiations and settlements related to certain prior year retail store closures.

For the year ended December 31, 2020, operating lease cost included $ 16.5 million of accelerated amortization for retail locations that permanently closed during 2020 for which the related lease liabilities had not been extinguished as of December 31, 2020 due to ongoing negotiations with the landlords.

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Notes to Consolidated Financial Statements

For the year ended December 31, 2022, operating lease costs included $ 0.8 million of ROU asset impairment charges related to underperforming retail locations, as well as a gain of $ 4.8 million from the completion of lease termination negotiations and settlements related to certain retail store closures in 2020 and 2022, primarily in the U.S.

For the year ended December 31, 2021, operating lease costs included $ 0.5 million of ROU asset impairment charges related to underperforming retail locations primarily in the EMEA.

segment, as well as a gain of $ 8.6 million from the completion of lease termination negotiations and settlements related to certain 2020 retail store closures, primarily in the U.S.

For the year ended December 31, 2020, op erating lease cost included $ 16.5 million of accelerated amortization for retail locations that permanently closed during 2020 for which the related lease liabilities had not been extinguished as of December 31, 2020 due to ongoing negotiations with the landlords.

In addition, for the year ended December 31, 2020, operating lease cost included $ 7.0 million of ROU asset impairment charges related to underperforming retail locations primarily in the U.S.

segment for the year ended December 31, 2020.

There was no impairment recorded for the year ended December 31, 2019.

In the periods presented, lease concessions reducing variable lease expense were not material.

The following table presents supplemental cash flow information:

The following table presents supplemental cash flow information related to leases:

Year Ended December 31,

4 unchanged sentences

Reductions to ROU assets resulting from reductions to operating lease liabilities $ 52 $ 118 $ 6,400

(1) The year ended December 31, 2019 reflects the impact from amount initially capitalized in conjunction with the adoption of ASC 842.

(1) Includes amounts added to the carrying amount of lease liabilities resulting from lease modifications and reassessments.

2 unchanged sentences

Weighted average discount rate 4.21 % 3.25 %

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I ndex to Notes to Consolidated Financial State ments

The following table presents the future maturities of lease liabilities as of December 31, 2022:

8 unchanged sentences

As of December 31, 2022, the Company has additional operating lease commitments that have not yet commenced of $ 1.5 million.

These leases will commence in 2022 with lease terms of approximately one to 10 years.

These leases will commence in 2023 with lease terms of approximately three to six years.

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Notes to Consolidated Financial Statements

NOTE 10 — INCOME TAXES

INCOME TAX PROVISION

Consolidated income from continuing operations before income taxes consisted of the following:

Consolidated income from operations before income taxes consisted of the following:

Year Ended December 31,

17 unchanged sentences

Income tax expense $ 85,970 $ 97,403 $ 31,510

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The following is a reconciliation of the statutory federal income tax rate to the effective rate reported in the financial statements:

12 unchanged sentences

Actual provision for income taxes 21.6 % 21.6 % 22.6 %

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Notes to Consolidated Financial Statements

DEFERRED INCOME TAX BALANCES

10 unchanged sentences

Tax credits 2,751 387

Foreign currency — 2,418

Other 10,902 2,164

10 unchanged sentences

Total net deferred taxes $ 94,019 $ 92,121

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I ndex to Notes to Consolidated Financial State ments

Subsequent to the issuance of the Company’s December 31, 2020 consolidated financial statements, the Company identified that the Lease liability and corresponding ROU lease asset shown in the table above had been presented net with accruals and allowances, rather than gross.

As a result, 2020 amounts in the table above have been revised from balances previously reported.

The Company has assessed the qualitative and quantitative impact of the misstatement and determined it is not material to the 2020 financial statements.

Further, the Company had previously recorded Sales reserves within Capitalized inventory costs, rather than presenting them separately and has reclassified such amounts to conform to the current year presentation.

The Company has foreign net operating loss carryforwards of $ 87.5 million as of December 31, 2021, of which $ 68.4 million have an unlimited carryforward period and $ 19.1 million expire between 2025 and 2040.

The net operating losses result in deferred tax assets of $ 22.8 million and $ 24.3 million and were subject to a valuation allowance of $ 20.2 million and $ 21.2 million at December 31, 2021 and 2020, respectively.

At December 31, 2021, the Company had accumulated undistributed earnings generated by the Company's foreign subsidiaries of $333.9 million.

The Company had foreign net operating loss carryforwards of $ 64.3 million as of December 31, 2022, all of which has an unlimited carryforward period.

As of December 31, 2022 and 2021, the net operating losses result in deferred tax assets of $ 18.8 million and $ 22.8 million, respectively, and were subject to a valuation allowance of $ 18.8 million and $ 20.2 million, respectively.

As of December 31, 2022, the Company had accumulated undistributed earnings generated by the Company's foreign subsidiaries of $ 422.9 million.

As a result of the Tax Cuts and Jobs Act, these earnings have been subject to U.S.

tax, so any further taxes associated with such earnings would generally be limited to foreign withholding and state taxes.

The Company has recorded a deferred tax liability for these, except in the jurisdictions where we intend to indefinitely reinvest the earnings.

The Company has recorded a deferred tax liability for these, except in the jurisdictions where the Company intends to indefinitely reinvest the earnings.

UNRECOGNIZED TAX BENEFITS

2 unchanged sentences

The Company has effectively settled Canadian tax examinations of all years through 2012, United States tax examinations of all years through 2018, Japanese tax examinations of all years through 2019, France tax examinations of all years through 2016, Swiss tax examinations of all years through 2019, Italy tax examinations of all years through 2016, and China tax examinations of all years through 2018.

The Korean National Tax Service concluded an audit of the Company's 2009 through 2013 corporate income tax returns in 2014, and an audit of the Company's 2014 corporate income tax return in 2016.

Due to the nature of the findings in both of these audits, the Company has invoked the Mutual Agreement Procedures outlined in the United States-Korean income tax treaty.

The Korean National Tax Service concluded an audit of the Company's 2009 through 2013 corporate income tax returns in 2014, an audit of the Company's 2014 corporate income tax return in 2016, and an audit of 2016 through 2020 corporate income tax returns in 2022.

Due to the nature of the findings in the 2009 through 2014 audits, the Company has invoked the Mutual Agreement Procedures outlined in the United States-Korean income tax treaty.

The Company does not anticipate that adjustments relative to these findings, or any other ongoing tax audits, will result in material changes to its financial condition, results of operations or cash flows.

As of December 31, 2021, the Company was under audit in the United States for tax years 2017 and 2018, Canada for tax years 2017 and 2018, and Korea for tax years 2016 through 2020.

As of December 31, 2022, the

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Notes to Consolidated Financial Statements

Company was under audit in Canada for tax year 2018.

Other than the findings and audits previously noted, the Company is not currently under examination in any other major jurisdiction.

7 unchanged sentences

Increases related to current year tax positions 1,355 883 906

Settlements — — ( 1,464 )

Expiration of statute of limitations ( 3,621 ) ( 429 ) ( 632 )

1 unchanged sentence

Due to the potential for resolution of income tax audits currently in progress, and the expiration of various statutes of limitation, it is reasonably possible that the unrecognized tax benefits balance may change within the twelve months following December 31, 2022 by a range of zero to $ 2.4 million.

Open tax years, including those previously mentioned, contain matters that could be subject to differing

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I ndex to Notes to Consolidated Financial State ments

interpretations of applicable tax laws and regulations as they relate to the amount, timing, or inclusion of revenue and expenses or the sustainability of income tax credits for a given examination cycle.

Unrecognized tax benefits of $ 12.9 million, $ 13.6 million and $ 11.5 million would affect the effective tax rate if recognized at December 31, 2021, 2020 and 2019, respectively.

Open tax years, including those previously mentioned, contain matters that could be subject to differing interpretations of applicable tax laws and regulations as they relate to the amount, timing, or inclusion of revenue and expenses or the sustainability of income tax credits for a given examination cycle.

Unrecognized tax benefits of $ 9.2 million, $ 12.9 million and $ 13.6 million would affect the effective tax rate if recognized as of December 31, 2022, 2021 and 2020, respectively.

The Company recognizes interest expense and penalties related to income tax matters in Income tax expense .

The Company recognized a net increase of accrued interest and penalties of $ 0.3 million in 2021, and a net increase of accrued interest and penalties of $ 0.8 million in 2020 and a net reversal of accrued interest and penalties of $ 0.5 million in 2019, all of which related to uncertain tax positions.

The Company had $ 2.6 million and $ 2.3 million of accrued interest and penalties related to uncertain tax positions at December 31, 2021 and 2020, respectively.

The Company recognized a net decrease of accrued interest and penalties of $ 0.8 million in 2022, and a net increase of accrued interest and penalties of $ 0.3 million in 2021 and a net increase of accrued interest and penalties of $ 0.8 million in 2020, all of which related to uncertain tax positions.

The Company had $ 1.8 million and $ 2.6 million of accrued interest and penalties related to uncertain tax positions as of December 31, 2022 and 2021, respectively.

NOTE 11 — RETIREMENT SAVINGS PLANS

7 unchanged sentences

This plan allows participants to defer receipt of a portion of their salary and incentive compensation and to receive matching contributions for a portion of the deferred amounts.

Costs recognized for Company matching contributions to the plan totaled $ 0.2 million, $ 0.4 million and $ 0.5 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Participants earn a return on their deferred compensation ba sed on investment earnings of participant-selected investments.

Deferred compensation, including accumulated earnings on the participant-directed investment selections, is distributable in cash at participant-specified dates or upon retirement, death, disability, or termination of employment.

Costs recognized for Company matching contributions to the plan were immaterial for the years ended December 31, 2022, 2021 and 2020.

Participants earn a return on their deferred compensation based on investment earnings of participant-selected investments.

Deferred compensation, including accumulated earnings on the participant-directe d investment selections, is distributable in cash at participant-specified dates or upon retirement, death, disability, or termination of employment.

The Company has purchased specific money market and mutual funds in the same amounts as the participant-directed investment selections underlying the deferred compensation liabilities.

These investment securities and earnings thereon, held in an irrevocable trust, are intended to provide a source of funds to meet the deferred compensation obligations, subject to claims of creditors in the event of the Company's insolvency.

Changes in the market value of the participants' investment selections are recorded as an adjustment to the investments and as unrealized gains and losses in SG&A expense .

A corresponding adjustment of an equal amount is made to the deferred compensation liabilities and compensation expense, which is included in SG&A expense .

At December 31, 2021 and 2020 , the long-term portion of the liability to participants under this plan was $ 21.8 million and $ 18.7 million, respectively, and was recorded in Other long-term liabilities .

At December 31, 2021 and 2020, the current portion of the participant liability was $ 1.0 million and $ 1.2 million, respectively, and was recorded in Accrued liabilities .

At December 31, 2021 and 2020, the fair value of the long-term portion of the investments related to this plan was $ 21.8 million and $ 18.7 million, respectively, and was recorded in Other non-current assets .

At December 31, 2021 and 2020, the current portion of the investments related to this plan was $ 1.0 million and $ 1.2 million, respectively, and was recorded in Short-term investments .

Changes in the market value of the participants' investment selections are recorded as an adjustment to the investments and as

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Notes to Consolidated Financial Statements

unrealized gains and losses in SG&A expenses .

A corresponding adjustment of an equal amount is made to the deferred compensation liabilities and compensation expense, which is included in SG&A expenses .

As of December 31, 2022 and 2021 , the long-term portion of the liability to participants under this plan was $ 20.5 million and $ 21.8 million, respectively, and was recorded in Other long-term liabilities .

As of December 31, 2022 and 2021, the current portion of the participant liability was $ 0.7 million and $ 1.0 million, respectively, and was recorded in Accrued liabilities .

As of December 31, 2022 and 2021, the fair value of the long-term portion of the investments related to this plan was $ 20.5 million and $ 21.8 million, respectively, and was recorded in Other non-current assets .

As of December 31, 2022 and 2021, the current portion of the investments related to this plan was $ 0.7 million and $ 1.0 million, respectively, and was recorded in Short-term investments .

NOTE 12 — COMMITMENTS AND CONTINGENCIES

1 unchanged sentence

Management has considered facts related to legal and regulatory matters and opinions of counsel handling these matters, and does not believe the ultimate resolution of these proceedings will have a material adverse effect on the Company's financial position, results of operations or cash flows.

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INDEMNITIES AND GUARANTEES

9 unchanged sentences

Under this program as of December 31, 2022, the Company had repurchased 31.7 million shares at an aggregate purchase price of $ 1,470.6 million and had $ 529.4 million remaining available.

During the year ended December 31, 2021, the Company purchased an aggregate of $ 165.9 million of common stock under this program.

During the year ended December 31, 2022, the Company repurchased an aggregate of $ 286.9 million of common stock under this program.

NOTE 14 — STOCK-BASED COMPENSATION

3 unchanged sentences

The Company has reserved 3.0 million shares of common stock for issuance under the 2020 Plan, plus up to an aggregate of 1.5 million shares of the Company's common stock that were previously authorized and available for issuance under the Prior Plan.

At December 31, 2021, 3,643,701 shares were available for future grants under the 2020 Plan and up to 94,528 additional shares that were previously authorized and available for issuance under the Prior Plan may become available for future grants under the 2020 Plan.

As of December 31, 2022, 3,094,028 shares were available for future grants under the 2020 Plan.

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Notes to Consolidated Financial Statements

The Company's Stock Incentive Plan allows for grants of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock units, and other stock-based or cash-based awards.

5 unchanged sentences

Cost of sales $ 312 $ 313 $ 303

SG&A expense 18,813 17,475 17,554

SG&A expenses 20,709 18,813 17,475

Pre-tax stock-based compensation expense 21,021 19,126 17,778

2 unchanged sentences

The Company realized a tax benefit for the deduction from stock-based award transactions of $ 3.6 million, $ 8.3 million and $ 4.1 million for the years ended December 31, 2022, 2021 and 2020, respectively.

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I ndex to Notes to Consolidated Financial State ments

STOCK OPTIONS

15 unchanged sentences

Weighted average grant date fair value per stock option granted $ 18.33 $ 17.95 $ 14.67

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Notes to Consolidated Financial Statements

The following table summarizes stock option activity under the Plan:

Shares Weighted

Options Weighted

Price Weighted Average Remaining Contractual Life Aggregate Intrinsic Value (1)

(in thousands)

Options outstanding at January 1, 2019

Options outstanding as of December 31, 2019

1,479,674 $ 66.74 7.11 $ 49,930

Granted 660,071 87.25

Cancelled ( 68,275 ) 74.10

Forfeited or expired ( 78,163 ) 83.76

Exercised ( 142,419 ) 48.58

Options outstanding at December 31, 2019

Options outstanding as of December 31, 2020

1,919,163 74.45 7.19 29,489

Granted 687,772 95.90

Cancelled ( 78,163 ) 83.76

Forfeited or expired ( 213,444 ) 89.96

Exercised ( 459,957 ) 62.58

Options outstanding at December 31, 2020

Options outstanding as of December 31, 2021

1,933,534 83.19 7.26 29,889

Granted 561,295 89.25

Cancelled ( 213,444 ) 89.96

Forfeited or expired ( 223,813 ) 91.09

Exercised ( 116,109 ) 56.75

Options outstanding at December 31, 2021

Options outstanding as of December 31, 2022

2,154,907 $ 85.37 7.02 $ 13,929

Options vested and expected to vest at December 31, 2021

Options vested and expected to vest as of December 31, 2022

2,070,905 $ 85.12 6.95 $ 13,855

Options exercisable at December 31, 2021

Options exercisable as of December 31, 2022

958,748 $ 77.38 5.42 $ 12,735

(1) The aggregate intrinsic value above represents pre-tax intrinsic value that would have been realized if all options had been exercised on the last business day of the period indicated, based on the Company's closing stock price on that day.

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I ndex to Notes to Consolidated Financial State ments

Stock option compensation expense for the years ended December 31, 2021, 2020 and 2019 was $ 6.9 million, $ 7.0 million and $ 6.2 million, respectively.

At December 31, 2021, unrecognized costs related to outstanding stock options totaled $ 13.1 million, before any related tax benefit.

Stock option compensation expense was $ 7.8 million, $ 6.9 million and $ 7.0 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2022, unrecognized costs related to outstanding stock options totaled $ 12.9 million, before any related tax benefit.

The unrecognized costs related to stock options are being amortized over the related vesting period using the straight-line attribution method.

1 unchanged sentence

The aggregate intrinsic value of stock options exercised was $ 3.4 million, $ 19.2 million and $ 4.9 million for the years ended December 31, 2022, 2021 and 2020, respectively.

The total cash received as a result of stock option exercises for the years ended December 31, 2021, 2020 and 2019 was $ 28.8 million, $ 6.9 million and $ 19.8 million, respectively.

The total cash received as a result of stock option exercises was $ 6.6 million, $ 28.8 million and $ 6.9 million for the years ended December 31, 2022, 2021 and 2020, respectively.

RESTRICTED STOCK UNITS

5 unchanged sentences

Other assumptions incorporated into the grant date fair value include the vesting period and the Company's expected annual dividend yield.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 60

Notes to Consolidated Financial Statements

The weighted average assumptions for restricted stock units granted and resulting fair value are as follows:

5 unchanged sentences

The following table summarizes the restricted stock unit activity under the Plan:

Restricted Stock Units

Weighted Average

Grant Date Fair Value Per Share

Restricted stock units outstanding at January 1, 2019

Grant Date Fair Value Per Unit

Restricted stock units outstanding as of December 31, 2019

405,104 $ 76.45

2 unchanged sentences

Forfeited ( 35,918 ) 79.36

Restricted stock units outstanding at December 31, 2019

Restricted stock units outstanding as of December 31, 2020

425,275 80.37

2 unchanged sentences

Forfeited ( 68,399 ) 86.38

Restricted stock units outstanding at December 31, 2020

Restricted stock units outstanding as of December 31, 2021

369,592 88.88

2 unchanged sentences

Forfeited ( 64,925 ) 89.29

Restricted stock units outstanding at December 31, 2021

Restricted stock units outstanding as of December 31, 2022

410,853 $ 87.07

1 unchanged sentence

For the years ended December 31, 2022, 2021 and 2020, the Company withheld 47,130 , 56,792 and 54,543 shares, respectively, to satisfy $ 4.2 million, $ 5.8 million and $ 4.5 million of employees' tax obligations, respectively.

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I ndex to Notes to Consolidated Financial State ments

Restricted stock unit compensation expense for the years ended December 31, 2021, 2020 and 2019 was $ 12.2 million, $ 10.8 million and $ 11.6 million, respectively.

At December 31, 2021, unrecognized costs related to restricted stock units totaled $ 19.1 million, before any related tax benefit.

Restricted stock unit compensation expense was $ 13.2 million, $ 12.2 million and $ 10.8 million for the years ended December 31, 2022, 2021 and 2020, respectively.

As of December 31, 2022, unrecognized costs related to restricted stock units totaled $ 21.7 million, before any related tax benefit.

The unrecognized costs related to restricted stock units are being amortized over the related vesting period using the straight-line attribution method.

These unrecognized costs at December 31, 2021 are expected to be recognized over a weighted average period of 2.09 years.

The total grant date fair value of restricted stock units vested during the years ended December 31, 2021, 2020 and 2019 was $ 12.4 million, $ 11.0 million and $ 9.9 million, respectively.

These unrecognized costs as of December 31, 2022 are expected to be recognized over a weighted average period of 2.24 years.

The total grant date fair value of restricted stock units vested was $ 12.4 million, $ 12.4 million and $ 11.0 million during the years ended December 31, 2022, 2021 and 2020, respectively.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 61

Notes to Consolidated Financial Statements

NOTE 15 — EARNINGS PER SHARE

14 unchanged sentences

Diluted $ 4.95 $ 5.33 $ 1.62

Stock options and service-based restricted stock units, and performance-based restricted stock representing 843,578 , 1,122,935 and 405,928 shares of common stock for the years ended December 31, 2021, 2020 and 2019, respectively, were outstanding but were excluded from the computation of diluted EPS because their effect would be anti-dilutive under the treasury stock method or because the shares were subject to performance conditions that had not been met.

Anti-dilutive common shares (1)

1,735 844 1,123

(1) Common stock related to stock options and service-based restricted stock units, and performance-based restricted stock were outstanding but were excluded from the computation of diluted EPS because their effect would be anti-dilutive under the treasury stock method or because the shares were subject to performance conditions that had not been met.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 62

I ndex to Notes to Consolidated Financial State ments

Notes to Consolidated Financial Statements

NOTE 16 — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Accumulated other comprehensive income (loss) on the Consolidated Balance Sheets is net of applicable taxes, and consists of unrealized holding gains and losses on available-for-sale securities, unrealized gains and losses on certain derivative transactions and foreign currency translation adjustments.

The following table sets forth the changes in Accumulated other comprehensive income (loss) attributable to the Company:

(in thousands) Unrealized gains (losses)

on available-for-

sale securities Unrealized holding

gains (losses) on

derivative transactions Foreign currency

Accumulated other comprehensive income (loss) on the Consolidated Balance Sheets is net of applicable taxes, and consists of unrealized gains and losses on available-for-sale securities, unrealized gains and losses on certain derivative transactions and foreign currency translation adjustments.

The following table sets forth the changes in Accumulated other comprehensive income (loss) :

(in thousands) Available-for-sale securities Derivative transactions Foreign currency

adjustments Total

Balance at January 1, 2019

$ ( 60 ) $ 11,964 $ ( 15,967 ) $ ( 4,063 )

Other comprehensive income before reclassifications 56 6,669 2,064 8,789

Amounts reclassified from accumulated other comprehensive loss (1)

Balance as of December 31, 2019 $ ( 4 ) $ 9,482 $ ( 13,903 ) $ ( 4,425 )

Other comprehensive income (loss) before reclassifications 4 ( 7,218 ) 24,078 16,864

Amounts reclassified from accumulated other comprehensive income (loss) (1)

— ( 11,633 ) — ( 11,633 )

Net other comprehensive income (loss) during the year 56 ( 2,383 ) 2,064 ( 263 )

Purchase of non-controlling interest — ( 99 ) — ( 99 )

Balance at December 31, 2019

Net other comprehensive income (loss) 4 ( 18,851 ) 24,078 5,231

Balance as of December 31, 2020

— ( 9,369 ) 10,175 806

Other comprehensive income (loss) before reclassifications — 16,113 ( 24,465 ) ( 8,352 )

Amounts reclassified from accumulated other comprehensive loss (1)

Amounts reclassified from accumulated other comprehensive income (loss) (1)

— 3,170 — 3,170

Net other comprehensive income (loss) during the year 4 ( 18,851 ) 24,078 5,231

Balance at December 31, 2020

Net other comprehensive income (loss) — 19,283 ( 24,465 ) ( 5,182 )

Balance as of December 31, 2021

— 9,914 ( 14,290 ) ( 4,376 )

Other comprehensive income (loss) before reclassifications ( 451 ) 20,724 ( 38,137 ) ( 17,864 )

Amounts reclassified from accumulated other comprehensive income (1)

Amounts reclassified from accumulated other comprehensive income (loss) (1)

451 ( 8,848 ) — ( 8,397 )

Net other comprehensive income (loss) during the year — 19,283 ( 24,465 ) ( 5,182 )

Balance at December 31, 2021

Net other comprehensive income (loss) — 11,876 ( 38,137 ) ( 26,261 )

Balance as of December 31, 2022

$ — $ 21,790 $ ( 52,427 ) $ ( 30,637 )

(1) Amounts reclassified are recorded in Net sales, Cost of sales, or Other operating income (expense), net on the Consolidated Statements of Operations.

(1) Amounts reclassified are recorded in Net sales , Cost of sales , or Other non-operating income (expense), net on the Consolidated Statements of Operations.

Refer to Note 18 for further information regarding reclassifications.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 63

Notes to Consolidated Financial Statements

NOTE 17 — SEGMENT INFORMATION

2 unchanged sentences

Each geographic segment operates predominantly in one industry:

the design, development, marketing, and distribution of outdoor, active and everyday lifestyle apparel, footwear, accessories, and equipment products.

the design, development, marketing, and distribution of outdoor, active and lifestyle products, including apparel, footwear, accessories, and equipment.

Intersegment net sales and intersegment profits, which are recorded at a negotiated mark-up and eliminated in consolidation, are not material.

Unallocated corporate expenses consist of expenses incurred by centrally-managed departments, including global information services, finance, human resources and legal, as well as executive compensation, unallocated benefit program expense, trademark impairment charges, and other miscellaneous costs.

COLUMBIA SPORTSWEAR COMPANY | 2021 FORM 10-K | 63

I ndex to Notes to Consolidated Financial State ments

The following table presents financial information for the Company's reportable segments:

Unallocated corporate expenses consist of expenses incurred by centrally-managed departmental functions, including consumer digital technology, certain supply chain functions, finance, human resources and legal, as well as executive compensation, unallocated benefit program expense, goodwill and intangible asset impairment charges, and other miscellaneous costs.

The following tables present financial information for the Company's reportable segments:

Year Ended December 31,

24 unchanged sentences

$ 54,752 $ 55,922 $ 63,416

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 64

Notes to Consolidated Financial Statements

(in thousands)

Accounts receivable, net:

4 unchanged sentences

$ 547,561 $ 487,803

Inventories, net:

$ 747,762 $ 455,960

8 unchanged sentences

$ 291,214 $ 291,088

COLUMBIA SPORTSWEAR COMPANY | 2021 FORM 10-K | 64

I ndex to Notes to Consolidated Financial State ments

NOTE 18 — FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

5 unchanged sentences

Subsidiaries that use European euros, Canadian dollars, Japanese yen, Chinese renminbi, or Korean won as their functional currency are primarily exposed to changes in functional currency equivalent cash flows from anticipated United States dollar inventory purchases.

Subsidiaries that use United States dollars and euros as their functional currency also have non-functional currency denominated sales for which the Company hedges the Canadian dollar and British pound.

The Company manages these risks by using currency forward contracts formally designated and effective as cash flow hedges.

The Company seeks to manage these risks by using currency forward contracts formally designated and effective as cash flow hedges.

Hedge effectiveness is generally determined by evaluating the ability of a hedging instrument's cumulative change in fair value to offset the cumulative change in the present value of expected cash flows on the underlying exposures.

For forward contracts, prior to June 2019, the time value components ("forward points") were excluded from the determination of hedge effectiveness and included in current period Cost of sales for hedges of anticipated United States dollar inventory purchases and in Net sales for hedges of anticipated non-functional currency denominated sales on a straight-line basis over the life of the contract.

Effective June 2019, the forward points are now included in the fair value of the cash flow hedge on a prospective basis.

Time value components ("forward points") for forward contracts are included in the fair value of the cash flow hedge.

These costs or benefits will be included in Accumulated other comprehensive income (loss) until the underlying hedge transaction is recognized in either Net sales or Cost of sales , at which time, the forward points will also be recognized as a component of Net income .

The Company also uses currency forward contracts not formally designated as hedges to manage the consolidated currency exchange rate risk associated with the remeasurement of non-functional currency denominated monetary assets and liabilities by subsidiaries that use United States dollars, euros, Canadian dollars, yen, won, or renminbi as their functional currency.

Non-functional currency denominated monetary assets and liabilities consist primarily of cash and cash equivalents, short-term investments, receivables, payables, deferred income taxes, and intercompany loans.

Non-functional currency denominated monetary assets and liabilities consists of cash and cash equivalents, short-term investments, receivables, payables, deferred income taxes, and intercompany loans and dividends.

The gains and losses generated on these currency forward contracts not formally designated as hedges are expected to be largely offset in Other non-operating income (expense), net by the gains and losses generated from the remeasurement of the non-functional currency denominated monetary assets and liabilities.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 65

Notes to Consolidated Financial Statements

The following table presents the gross notional amount of outstanding derivative instruments:

4 unchanged sentences

Currency forward contracts 448,838 267,982

At December 31, 2021, $ 4.2 million of deferred net loss on both outstanding and matured derivatives recorded in Accumulated other comprehensive income (loss) are expected to be reclassified to Net income during the next twelve months as a result of underlying hedged transactions also being recorded in Net sa les or Cost of sales in the Consolidated Statements of Operations.

When outstanding derivative contracts mature, actual amounts ultimately reclassified to Net sa les or Cost of sales in the Consolidated Statements of Comprehensive Income are dependent on United States dollar exchange rates in effect against the euro, pound sterling, renminbi, Canadian dollar, and yen as well as the euro exchange rate in effect against the pound sterling.

At December 31, 2021, the Company's derivative contracts had a remaining maturity of less than three years .

The maximum net exposure to any single counterparty, which is generally limited to the aggregate unrealized gain of all contracts with that counterparty, was $ 4.1 million at December 31, 2021.

As of December 31, 2022, $ 22.8 million of deferred net gains on both outstanding and matured derivatives recorded in Accumulated other comprehensive income (loss) are expected to be reclassified to Net income during the next twelve months as a result of underlying hedged transactions also being recorded in Net sa les, Cost of sales, or Other non-operating income (expense), net in the Consolidated Statements of Operations.

When outstanding derivative contracts mature, actual amounts ultimately reclassified to Net sa les, Cost of sales, or Other non-operating income (expense), net in the Consolidated Statements of Operations are dependent on United States dollar exchange rates in effect against the euro, pound sterling, renminbi, Canadian dollar, won, and yen as well as the euro exchange rate in effect against the pound sterling.

As of December 31, 2022, the Company's derivative contracts had a remaining maturity of less than three years .

The maximum net exposure to any single counterparty, which is generally limited to the aggregate unrealized gain of all contracts with that counterparty, was $ 7.5 million as of December 31, 2022.

All of the Company's derivative counterparties have credit ratings that are investment grade or higher.

1 unchanged sentence

The Company has not pledged assets or posted collateral as a requirement for entering into or maintaining derivative positions.

COLUMBIA SPORTSWEAR COMPANY | 2021 FORM 10-K | 65

I ndex to Notes to Consolidated Financial State ments

The following table presents the balance sheet classification and fair value of derivative instruments:

12 unchanged sentences

Currency forward contracts Accrued liabilities 2,533 1,027

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 66

Notes to Consolidated Financial Statements

The following table presents the statement of operations effect and classification of derivative instruments:

Statement Of Operations Classification Year Ended December 31,

Classification Year Ended December 31,

(in thousands) 2022 2021 2020

9 unchanged sentences

Other non-operating income (expense), net

Loss recognized in income for amount excluded from effectiveness testing and for the ineffective portion

Net sales — — ( 43 )

Gain recognized in income for amount excluded from effectiveness testing and for the ineffective portion

Cost of sales — — 2,380

Derivative instruments not designated as cash flow hedges:

Gain (loss) recognized in income

Loss recognized in income

Other non-operating income (expense), net

( 1,955 ) ( 608 ) ( 2,865 )

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 67

Notes to Consolidated Financial Statements

NOTE 19 — FAIR VALUE MEASURES

1 unchanged sentence

Fair value is defined as an exit price, representing the amount that the Company would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants, under a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

COLUMBIA SPORTSWEAR COMPANY | 2021 FORM 10-K | 66

I ndex to Notes to Consolidated Financial State ments

Level 1 — observable inputs such as quoted prices for identical assets or liabilities in active liquid markets;

9 unchanged sentences

Money market funds $ 120,481 $ — $ — $ 120,481

Available-for-sale short-term investments:

Government treasury bills — 130,168 — 130,168

Other short-term investments:

Short-term investments:

Money market funds 80 — — 80

Mutual fund shares 642 — — 642

Other current assets:

Prepaid expenses and other current assets:

Derivative financial instruments — 23,333 — 23,333

Non-current assets:

Other non-current assets:

Money market funds 1,456 — — 1,456

7 unchanged sentences

Total liabilities measured at fair value $ — $ 5,552 $ — $ 5,552

(1) Available-for-sale short-term investments have remaining maturities of less than one year.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 68

I ndex to Notes to Consolidated Financial State ments

Assets and liabilities measured at fair value on a recurring basis at December 31, 2020 are as follows:

Notes to Consolidated Financial Statements

Assets and liabilities measured at fair value on a recurring basis as of December 31, 2021 are as follows:

(in thousands) Level 1 Level 2 Level 3 Total

1 unchanged sentence

Money market funds $ 2,677 $ — $ — $ 2,677

United States government treasury bills — 234,982 — 234,982

Short-term investments:

Available-for-sale short-term investments:

Government treasury bills — 130,168 — 130,168

Other short-term investments:

Money market funds 73 — — 73

Mutual fund shares 904 — — 904

Other current assets:

Prepaid and other current assets:

Derivative financial instruments — 9,397 — 9,397

Non-current assets:

Other non-current assets:

Money market funds 2,219 — — 2,219

7 unchanged sentences

Total liabilities measured at fair value $ — $ 3,890 $ — $ 3,890

(1) Available-for-sale short-term investments have remaining maturities of less than one year.

NON-RECURRING FAIR VALUE MEASUREMENTS

The Company measured the fair value of certain trademark and trade name intangible assets and certain retail store long-lived assets consisting of property, plant and equipment, and lease ROU assets as part of impairment testing for the year ended December 31, 2021.

The Company measured the fair value of certain retail store long-lived assets consisting of property, plant and equipment, certain trademark intangible assets and goodwill, and lease ROU assets as part of impairment testing for the year ended December 31, 2022.

The inputs used to measure the fair value of these assets are primarily unobservable inputs and, as such, considered Level 3 fair value measurements.

See Notes 5, 6 and 9 for discussion of impairment charges.

Refer to Notes 5, 6 and 9 herein for discussion of impairment charges.

COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-K | 69

I ndex to Notes to Consolidated Financial State ments

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data