COLUMBIA SPORTSWEAR CO 10-Q

ITEM 1. FINANCIAL STATEMENTS CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) As of (in thousands) March 31, 2025 December 31, 2024 March 31, 2024 ASSETS Current Assets: Cash and cash equivalents $ 323,339 $ 531,869 $ 418,462 Short-term investments 335,076 283,608 369,270 Accounts receivable, net of allowance of $ 3,890 , $ 4,789 and $ 6,260 , respectively 387,850 417,539 366,375 Inventories 623,700 690,515 607,373 Prepaid expenses and other current assets 71,371 85,051 84,738 Total current assets 1,741,336 2,008,582 1,846,218 Property, plant and equipment, net of accumulated depreciation of $ 725,867 , $ 709,785 and $ 681,497 respectively 282,605 282,908 277,947 Operating lease right-of-use assets 408,048 399,669 361,103 Intangible assets, net 79,221 79,221 79,496 Goodwill 26,694 26,694 26,694 Deferred income taxes 104,747 104,203 100,162 Other non-current assets 64,764 73,988 70,611 Total assets $ 2,707,415 $ 2,975,265 $ 2,762,231 LIABILITIES AND EQUITY Current Liabilities: Accounts payable $ 268,504 $ 385,695 $ 150,131 Accrued liabilities 205,328 273,330 216,903 Operating lease liabilities 76,314 75,857 71,550 Income taxes payable 8,637 31,663 8,722 Total current liabilities 558,783 766,545 447,306 Non-current operating lease liabilities 380,562 373,328 340,310 Income taxes payable 14,052 13,176 26,262 Deferred income taxes 320 310 — Other long-term liabilities 43,931 41,867 38,910 Total liabilities 997,648 1,195,226 852,788 Commitments and contingencies (Note 8) Shareholders' Equity: Preferred stock; 10,000 shares authorized; none issued and outstanding — — — Common stock (no par value); 250,000 shares authorized; 55,169 , 56,245 and 59,473 issued outstanding, respectively — — — Retained earnings 1,771,218 1,843,261 1,960,634 Accumulated other comprehensive loss ( 61,451 ) ( 63,222 ) ( 51,191 ) Total shareholders' equity 1,709,767 1,780,039 1,909,443 Total liabilities and shareholders' equity $ 2,707,415 $ 2,975,265 $ 2,762,231 See accompanying notes to unaudited condensed consolidated financial statements. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 1 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended March 31, (in thousands, except per share amounts) 2025 2024 Net sales $ 778,452 $ 769,982 Cost of sales 382,395 380,423 Gross profit 396,057 389,559 Selling, general and administrative expenses 354,471 349,270 Net licensing income 4,922 4,392 Operating income 46,508 44,681 Interest income, net 6,817 9,197 Other non-operating income, net 1,551 271 Income before income tax 54,876 54,149 Income tax expense 12,628 11,849 Net income $ 42,248 $ 42,300 Earnings per share: Basic $ 0.76 $ 0.71 Diluted $ 0.75 $ 0.71 Weighted average shares outstanding: Basic 55,734 59,823 Diluted 55,983 59,998 See accompanying notes to unaudited condensed consolidated financial statements. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 2 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) Three Months Ended March 31, (in thousands) 2025 2024 Net income $ 42,248 $ 42,300 Other comprehensive income (loss): Change in available-for-sale securities (net of tax effect of $ 26 and $ 46 , respectively) ( 84 ) ( 145 ) Change in derivative transactions (net of tax effects of $ 2,983 and $( 3,435 ), respectively) ( 7,958 ) 9,777 Foreign currency translation adjustments (net of tax effects of $( 223 ) and $ 187 , respectively) 9,813 ( 14,987 ) Other comprehensive income (loss) 1,771 ( 5,355 ) Comprehensive income $ 44,019 $ 36,945 See accompanying notes to unaudited condensed consolidated financial statements. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 3 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Three Months Ended March 31, (in thousands) 2025 2024 Cash flows from operating activities: Net income $ 42,248 $ 42,300 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Depreciation and amortization 13,465 15,070 Non-cash lease expense 20,921 18,603 Provision for uncollectible accounts receivable 763 1,033 Deferred income taxes 2,658 1,232 Share-based compensation 5,224 5,644 Other, net ( 2,385 ) ( 4,198 ) Changes in operating assets and liabilities: Accounts receivable 33,254 50,409 Inventories 71,634 131,721 Prepaid expenses and other current assets 7,868 ( 511 ) Other assets 4,252 ( 2,055 ) Accounts payable ( 117,346 ) ( 77,004 ) Accrued liabilities ( 71,010 ) ( 49,050 ) Income taxes payable ( 22,227 ) ( 8,128 ) Operating lease assets and liabilities ( 21,609 ) ( 18,410 ) Other liabilities 252 117 Net cash provided by (used in) operating activities ( 32,038 ) 106,773 Cash flows from investing activities: Purchases of short-term investments ( 152,779 ) ( 58,974 ) Sales and maturities of short-term investments 106,913 110,878 Capital expenditures ( 15,565 ) ( 14,795 ) Net cash provided by (used in) investing activities ( 61,431 ) 37,109 Cash flows from financing activities: Proceeds from issuance of common stock related to share-based compensation 4,931 1,106 Tax payments related to share-based compensation ( 5,550 ) ( 4,354 ) Repurchase of common stock ( 101,430 ) ( 50,168 ) Cash dividends paid ( 16,600 ) ( 17,927 ) Net cash used in financing activities ( 118,649 ) ( 71,343 ) Net effect of exchange rate changes on cash 3,588 ( 4,396 ) Net increase (decrease) in cash and cash equivalents ( 208,530 ) 68,143 Cash and cash equivalents, beginning of period 531,869 350,319 Cash and cash equivalents, end of period $ 323,339 $ 418,462 Supplemental disclosures of cash flow information: Cash paid during the period for income taxes $ 35,832 $ 29,070 Supplemental disclosures of non-cash investing and financing activities: Property, plant and equipment acquired through increase in liabilities $ 8,712 $ 3,492 See accompanying notes to unaudited condensed consolidated financial statements. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 4 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) (in thousands, except per share amounts) Common Stock Retained Earnings Accumulated Other Comprehensive Income (Loss) Total Shares Outstanding Amount Balance, December 31, 2024 56,245 $ — $ 1,843,261 $ ( 63,222 ) $ 1,780,039 Net income — — 42,248 — 42,248 Other comprehensive income — — — 1,771 1,771 Cash dividends ($ 0.30 per share) — — ( 16,600 ) — ( 16,600 ) Issuance of common stock related to share-based compensation, net 176 ( 619 ) — — ( 619 ) Share-based compensation — 5,224 — — 5,224 Repurchase of common stock ( 1,252 ) ( 3,747 ) ( 97,691 ) — ( 101,438 ) Excise taxes related to repurchase of common stock — ( 858 ) — — ( 858 ) Balance, March 31, 2025 55,169 $ — $ 1,771,218 $ ( 61,451 ) $ 1,709,767 (in thousands, except per share amounts) Common Stock Retained Earnings Accumulated Other Comprehensive Loss Total Shares Outstanding Amount Balance, December 31, 2023 59,996 $ — $ 1,984,446 $ ( 45,836 ) $ 1,938,610 Net income — — 42,300 — 42,300 Other comprehensive loss — — — ( 5,355 ) ( 5,355 ) Cash dividends ($ 0.30 per share) — — ( 17,927 ) — ( 17,927 ) Issuance of common stock related to share-based compensation, net 108 ( 3,248 ) — — ( 3,248 ) Share-based compensation — 5,644 — — 5,644 Repurchase of common stock ( 631 ) ( 1,983 ) ( 48,185 ) — ( 50,168 ) Excise taxes related to repurchase of common stock — ( 413 ) — — ( 413 ) Balance, March 31, 2024 59,473 $ — $ 1,960,634 $ ( 51,191 ) $ 1,909,443 See accompanying notes to unaudited condensed consolidated financial statements. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 5 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE PAGE Note 1 Basis of Presentation and Organization 7 Note 2 Revenues 7 Note 3 Segment Information 8 Note 4 Share-Based Compensation 10 Note 5 Earnings Per Share 12 Note 6 Intangible Assets, Net and Goodwill 12 Note 7 Supply Chain Financing 13 Note 8 Commitments and Contingencies 13 Note 9 Shareholders' Equity 13 Note 10 Accumulated Other Comprehensive Loss 14 Note 11 Financial Instruments and Risk Management 14 Note 12 Fair Value Measures 16 COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 6 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements NOTE 1 — BASIS OF PRESENTATION AND ORGANIZATION The accompanying unaudited condensed consolidated financial statements have been prepared by the management of Columbia Sportswear Company (together with its wholly owned subsidiaries, the "Company") and, in the opinion of management, include all normal recurring material adjustments necessary to present fairly the Company's financial position as of March 31, 2025, December 31, 2024 and March 31, 2024, the results of operations for the three months ended March 31, 2025 and 2024, and cash flows for the three months ended March 31, 2025 and 2024. The December 31, 2024 financial information was derived from the Company's audited consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024. A significant part of the Company's business is of a seasonal nature; therefore, results of operations for the three months ended March 31, 2025 are not necessarily indicative of results to be expected for other quarterly periods or for the full year. Certain information and disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. The Company, however, believes that the disclosures contained in this report comply with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended, for a Quarterly Report on Form 10-Q and are adequate to make the information presented not misleading. These unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2024. PRINCIPLES OF CONSOLIDATION The unaudited condensed consolidated financial statements include the accounts of the Company. All significant intercompany balances and transactions have been eliminated in consolidation. 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 unaudited condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Accordingly, actual results may differ from these estimates and assumptions. The Company's significant estimates relate to sales reserves, excess, close-out and slow-moving inventory, impairment of long-lived assets, impairment of indefinite-lived intangible assets and goodwill, and income taxes. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS NOT YET ADOPTED In December 2023, the FASB issued ASU No. 2023-09 (“ASU 2023-09”), Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which includes amendments that further enhance income tax disclosures, primarily through disaggregation of specific rate reconciliation categories and income taxes paid by jurisdiction. The amendments are effective for annual periods beginning after December 15, 2024, with early adoption permitted, and may be applied prospectively or retrospectively. The Company is currently evaluating the ASU to determine the impact on the Company’s disclosures. In November 2024, the FASB issued ASU No. 2024-03 ("ASU 2024-03"), Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which is intended to improve disclosures about a public business entity's expenses, primarily through additional disaggregation of income statement expenses. ASU 2024-03 is effective for annual periods beginning after December 15, 2026, and interim periods beginning after December 15, 2027, with early adoption permitted. The amendments in ASU 2024-03 should be applied either prospectively to financial statements issued for reporting periods after the effective date or retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the ASU to determine the impact on the Company's disclosures. NOTE 2 — REVENUES DISAGGREGATED REVENUE As disclosed below in Note 3, the Company has four geographic reportable segments: United States ("U.S."), Latin America and Asia Pacific ("LAAP"), Europe, Middle East and Africa ("EMEA"), and Canada. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 7 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements The following tables disaggregate the Company's reportable 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: Three Months Ended March 31, 2025 (in thousands) U.S. LAAP EMEA Canada Total Product category net sales: Apparel, accessories and equipment $ 393,633 $ 120,292 $ 76,983 $ 37,912 $ 628,820 Footwear 77,548 31,918 30,497 9,669 149,632 Total $ 471,181 $ 152,210 $ 107,480 $ 47,581 $ 778,452 Channel net sales: Wholesale $ 218,834 $ 78,560 $ 74,006 $ 28,369 $ 399,769 Direct-to-consumer 252,347 73,650 33,474 19,212 378,683 Total $ 471,181 $ 152,210 $ 107,480 $ 47,581 $ 778,452 Three Months Ended March 31, 2024 (in thousands) U.S. LAAP EMEA Canada Total Product category net sales: Apparel, accessories and equipment $ 397,488 $ 107,963 $ 72,390 $ 41,213 $ 619,054 Footwear 76,918 30,683 32,130 11,197 150,928 Total $ 474,406 $ 138,646 $ 104,520 $ 52,410 $ 769,982 Channel net sales: Wholesale $ 217,134 $ 67,031 $ 75,748 $ 30,984 $ 390,897 Direct-to-consumer 257,272 71,615 28,772 21,426 379,085 Total $ 474,406 $ 138,646 $ 104,520 $ 52,410 $ 769,982 PERFORMANCE OBLIGATIONS For the three months ended March 31, 2025 and 2024, Net sales recognized from performance obligations related to prior periods were not material. Net sales expected to be recognized in any future period related to remaining performance obligations are not material. CONTRACT BALANCES As of March 31, 2025, December 31, 2024 and March 31, 2024, the Company did not have any contract assets and had an immaterial amount of contract liabilities included in Accrued liabilities on the unaudited Condensed Consolidated Balance Sheets. NOTE 3 — SEGMENT INFORMATION The Company defines its operating segments on the basis of the way in which internally reported financial information is regularly reviewed by the chief operating decision maker ("CODM") to analyze performance, make decisions, and allocate resources. The Company aggregates its operating segments with similar economic and operating characteristics into four reportable segments: U.S., LAAP, EMEA, and Canada. These reportable segments are organized by geographic location. Each geographic segment operates predominantly in one industry: the design, development, marketing, and distribution of outdoor, active and lifestyle products, including apparel, footwear, accessories, and equipment. The Company’s CODM is the Company’s president and chief executive officer. The Company’s CODM assesses the segments’ performance by using each segment's operating income. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 8 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements The CODM uses each segment's operating income to allocate resources predominantly in the annual budget and forecasting process. The CODM considers plan-to-actual variances on a quarterly basis for the segment operating income profit measure when making decisions about the allocation of operating and capital resources to each segment. The CODM also uses this profit measure to assess the performance of each segment by comparing the results of each segment with one another, and in the overall strategic planning for each segment. 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 departmental functions, including information technology, certain supply chain functions, finance, human resources, and legal, as well as executive compensation, unallocated benefit program expense, and other miscellaneous costs. The following tables present segment financial information for the Company's reportable segments: Three Months Ended March 31, 2025 (in thousands) U.S. LAAP EMEA Canada Total Net sales $ 471,181 $ 152,210 $ 107,480 $ 47,581 $ 778,452 Cost of sales 239,908 66,278 52,855 23,354 382,395 Segment selling, general and administrative expenses 146,383 53,081 32,138 11,539 243,141 Other segment items (a) 18,936 6,521 3,509 3,725 32,691 Segment operating income 65,954 26,330 18,978 8,963 120,225 Reconciliation to income before income tax: Unallocated corporate expenses 73,717 Operating income 46,508 Interest income, net 6,817 Other non-operating income, net 1,551 Income before income tax $ 54,876 (a) For each reportable segment, other segment items include certain corporate expenses and net licensing income allocated to each of the reportable segments, as well as net licensing income directly attributable to each of the reportable segments. Three Months Ended March 31, 2024 (in thousands) U.S. LAAP EMEA Canada Total Net sales $ 474,406 $ 138,646 $ 104,520 $ 52,410 $ 769,982 Cost of sales 241,986 59,045 52,794 26,598 380,423 Segment selling, general and administrative expenses 138,917 50,221 28,796 10,363 228,297 Other segment items (a) 20,510 7,558 3,784 4,281 36,133 Segment operating income 72,993 21,822 19,146 11,168 125,129 Reconciliation to income before income tax: Unallocated corporate expenses 80,448 Operating income 44,681 Interest income, net 9,197 Other non-operating income, net 271 Income before income tax $ 54,149 (a) For each reportable segment, other segment items include certain corporate expenses and net licensing income allocated to each of the reportable segments, as well as net licensing income directly attributable to each of the reportable segments. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 9 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements The following table presents segment depreciation and amortization expense information: Three Months Ended March 31, (in thousands) 2025 2024 Depreciation and amortization expense: U.S. $ 6,101 $ 5,801 LAAP 1,538 1,389 EMEA 1,054 970 Canada 710 693 Unallocated corporate expense 4,062 6,217 $ 13,465 $ 15,070 The following table presents segment asset information: As of (in thousands) March 31, 2025 December 31, 2024 March 31, 2024 Inventories: U.S. $ 414,998 $ 450,014 $ 401,423 LAAP 87,738 108,818 81,483 EMEA 73,336 79,710 72,834 Canada 47,628 51,973 51,633 Total segment assets 623,700 690,515 607,373 All other assets 2,083,715 2,284,750 2,154,858 Total assets $ 2,707,415 $ 2,975,265 $ 2,762,231 CONCENTRATIONS No single customer accounted for 10% or more of Net sales for the three months ended March 31, 2025 and 2024. NOTE 4 — SHARE-BASED COMPENSATION 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 share-based or cash-based awards to officers, executives, key employees and nonemployee members of the Company’s Board of Directors. The Company uses original issuance shares to satisfy share-based payments. SHARE-BASED COMPENSATION EXPENSE Share-based compensation expense, which is primarily recorded in Selling, general and administrative ("SG&A") expenses , consisted of the following: Three Months Ended March 31, (in thousands) 2025 2024 Share-based compensation expense - equity awards $ 5,224 $ 5,644 Share-based compensation expense - liability awards 283 — Total $ 5,507 $ 5,644 COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 10 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements STOCK OPTIONS During the three months ended March 31, 2025, the Company granted a total of 160,263 stock options at a weighted average grant date fair value of $ 19.23 per option. As of March 31, 2025, unrecognized costs related to outstanding stock options, which are net of estimated forfeitures, totaled $ 9.6 million, before any related tax benefit. These unrecognized costs related to stock options are expected to be recognized over a weighted average period of 2.46 years. RESTRICTED STOCK UNITS Time-Based Restricted Stock Units During the three months ended March 31, 2025, the Company granted 333,091 time-based restricted stock units ("time-based RSUs") at a weighted average grant date fair value of $ 82.17 per time-based RSU. As of March 31, 2025, unrecognized costs related to outstanding time-based RSUs, which are net of estimated forfeitures, totaled $ 48.2 million, before any related tax benefit. These unrecognized costs related to time-based RSUs are expected to be recognized over a weighted average period of 3.05 years. Performance-Based Restricted Stock Units During the three months ended March 31, 2025, the Company granted 22,860 performance-based restricted stock units (“performance-based RSUs”) at a weighted average grant date fair value of $ 81.05 per performance-based RSU. As of March 31, 2025, unrecognized costs related to outstanding performance-based RSUs, which are net of estimated forfeitures and reflect achievement of performance forecasted as of the balance sheet date, totaled $ 1.6 million, before any related tax benefit. These unrecognized costs related to performance-based RSUs are expected to be recognized over a weighted average period of 2.01 years. Market-Based Restricted Stock Units During the three months ended March 31, 2025, the Company granted 22,860 market-based restricted stock units (“market-based RSUs”) at a weighted average grant date fair value of $ 117.40 per market-based RSU. As of March 31, 2025, unrecognized costs related to outstanding market-based RSUs, which are net of estimated forfeitures, totaled $ 3.4 million, before any related tax benefit. These unrecognized costs related to market-based RSUs are expected to be recognized over a weighted average period of 2.25 years. Market-Based Long-Term Cash Awards During the three months ended March 31, 2025, the Company issued a long-term cash award to its Chief Executive Officer with a target value of $ 1.3 million that includes both a market and time-based vesting condition. As of March 31, 2025, the fair value of all outstanding market-based long-term cash awards was $ 3.3 million and the Company had unrecognized compensation costs of $ 2.6 million. These unrecognized costs are expected to be recognized over a weighted average period of 2.25 years. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 11 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements NOTE 5 — EARNINGS PER SHARE Earnings per share ("EPS") is presented on both a basic and diluted basis. Basic EPS is based on the weighted average number of common shares outstanding. Diluted EPS reflects the potential dilution that could occur if outstanding securities or other contracts to issue common stock were exercised or converted into common stock. A reconciliation of the common shares used in the denominator for computing basic and diluted EPS is as follows: Three Months Ended March 31, (in thousands, except per share amounts) 2025 2024 Weighted average common shares outstanding, used in computing basic earnings per share 55,734 59,823 Effect of dilutive stock options and restricted stock units 249 175 Weighted average common shares outstanding, used in computing diluted earnings per share 55,983 59,998 Earnings per share: Basic $ 0.76 $ 0.71 Diluted $ 0.75 $ 0.71 Weighted average common shares excluded (1) 1,720 1,996 (1) Common stock related to stock options, time-based restricted stock units, market-based restricted stock units, and performance-based restricted stock units 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. NOTE 6 — INTANGIBLE ASSETS, NET AND GOODWILL INTANGIBLE ASSETS, NET Intangible assets, net consisted of the following: As of (in thousands) March 31, 2025 December 31, 2024 March 31, 2024 Intangible assets with definite lives: Patents and purchased technology $ 14,198 $ 14,198 $ 14,198 Customer relationships 23,000 23,000 23,000 Gross carrying amount 37,198 37,198 37,198 Accumulated amortization: Patents and purchased technology ( 14,198 ) ( 14,198 ) ( 14,198 ) Customer relationships ( 23,000 ) ( 23,000 ) ( 22,725 ) Accumulated amortization ( 37,198 ) ( 37,198 ) ( 36,923 ) Net carrying amount — — 275 Intangible assets with indefinite lives 79,221 79,221 79,221 Intangible assets, net $ 79,221 $ 79,221 $ 79,496 Intangible assets subject to amortization were fully amortized as of March 31, 2025 and December 31, 2024. For the three months ended March 31, 2024, amortization expense for intangible assets subject to amortization was $ 0.4 million. GOODWILL There have been no changes to the Company's goodwill as described in Note 5 in Part II, Item 8 of the Company's Annual Report on Form 10-K for the year ended December 31, 2024. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 12 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements NOTE 7 — SUPPLY CHAIN FINANCING The Company offers a voluntary supply chain financing (“SCF”) program facilitated through a third-party service provider. Under the program, participating suppliers may, at their sole discretion, elect to receive payment from a select number of third-party financial institutions for one or more of the Company’s valid payment obligations prior to their scheduled due dates. The Company is not a party to the agreements between the participating financial institutions and the suppliers in connection with the program. The Company’s payment terms, including the timing and amount of payments, are based on the original supplier invoices, irrespective of whether a supplier participates in the program. The Company does not have an economic interest in a supplier’s decision to participate in the program and has not pledged any assets as security or provided any guarantees as part of the program. The Company’s outstanding payables under the SCF program were $ 51.4 million, $ 81.3 million and $ 0 as of March 31, 2025, December 31, 2024, and March 31, 2024, respectively, and were recorded within Accounts payable on the Consolidated Balance Sheets. NOTE 8 — COMMITMENTS AND CONTINGENCIES LITIGATION The Company is involved in litigation and various legal matters arising in the normal course of business, including matters related to employment, retail, intellectual property, contractual agreements, and various regulatory compliance activities. 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. NOTE 9 — SHAREHOLDERS' EQUITY Since the inception of the Company's stock repurchase plan in 2004 through March 31, 2025, the Company's Board of Directors has authorized the repurchase of $ 2.6 billion of the Company's common stock, excluding excise tax. Shares of the Company's common stock may be purchased in the open market or through privately negotiated transactions, subject to market conditions, and generally settle subsequent to the trade date. The repurchase program does not obligate the Company to acquire any specific number of shares or to acquire shares over any specified period of time. Under this program as of March 31, 2025, the Company had repurchased 39.3 million shares at an aggregate purchase price of $ 2,073.9 million and had $ 526.1 million remaining available under the share repurchase program, excluding excise tax. During the three months ended March 31, 2025 and 2024, the Company repurchased an aggregate of $ 101.4 million and $ 50.2 million, respectively, of common stock under this program, excluding excise tax. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 13 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements NOTE 10 — ACCUMULATED OTHER COMPREHENSIVE LOSS Accumulated other comprehensive loss on the unaudited Condensed 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 tables set forth the changes in Accumulated other comprehensive loss : (in thousands) Available-for- sale securities Derivative transactions Foreign currency translation adjustments Total Balance as of December 31, 2024 $ 84 $ 23,394 $ ( 86,700 ) $ ( 63,222 ) Other comprehensive income (loss) before reclassifications — ( 5,910 ) 9,813 3,903 Amounts reclassified from accumulated other comprehensive loss (1) ( 84 ) ( 2,048 ) — ( 2,132 ) Net other comprehensive income (loss) during the period ( 84 ) ( 7,958 ) 9,813 1,771 Balance as of March 31, 2025 $ — $ 15,436 $ ( 76,887 ) $ ( 61,451 ) (1) Amounts reclassified are recorded in Net sales , Cost of sales , or Other non-operating income, net on the unaudited Condensed Consolidated Statements of Operations. Refer to Note 11 for further information regarding reclassifications . (in thousands) Available-for- sale securities Derivative transactions Foreign currency translation adjustments Total Balance as of December 31, 2023 $ 145 $ 3,689 $ ( 49,670 ) $ ( 45,836 ) Other comprehensive income (loss) before reclassifications ( 145 ) 11,727 ( 14,987 ) ( 3,405 ) Amounts reclassified from accumulated other comprehensive loss (1) — ( 1,950 ) — ( 1,950 ) Net other comprehensive income (Ioss) during the period ( 145 ) 9,777 ( 14,987 ) ( 5,355 ) Balance as of March 31, 2024 $ — $ 13,466 $ ( 64,657 ) $ ( 51,191 ) (1) Amounts reclassified are recorded in Net sales , Cost of sales , or Other non-operating income, net on the unaudited Condensed Consolidated Statements of Operations. Refer to Note 11 for further information regarding reclassifications. NOTE 11 — FINANCIAL INSTRUMENTS AND RISK MANAGEMENT In the normal course of business, the Company's financial position, results of operations and cash flows are routinely subject to a variety of risks. These risks include risks associated with financial markets, primarily currency exchange rate risk and, to a lesser extent, interest rate risk and equity market risk. The Company regularly assesses these risks and has established policies and business practices designed to mitigate them. The Company does not engage in speculative trading in any financial market. The Company actively manages the risk of changes in functional currency equivalent cash flows resulting from anticipated non-functional currency denominated purchases and sales. 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 U.S. dollar inventory purchases. Subsidiaries that use U.S. 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 sterling. 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. Time value components ("forward points") for forward contracts are included in the fair value of the cash flow hedge. These costs or benefits are included in Accumulated other comprehensive income (loss) until the underlying hedged 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 U.S. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 14 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements dollars, euros, Canadian dollars, yen, renminbi, or won as their functional currency. 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, net by the gains and losses generated from the remeasurement of the non-functional currency denominated monetary assets and liabilities. The following table presents the gross notional amount of outstanding derivative instruments: As of (in thousands) March 31, 2025 December 31, 2024 March 31, 2024 Derivative instruments designated as cash flow hedges: Currency forward contracts $ 696,672 $ 550,591 $ 597,355 Derivative instruments not designated as hedges: Currency forward contracts $ 308,063 $ 263,103 $ 231,449 As of March 31, 2025, $ 16.3 million of deferred net gains on both outstanding and matured derivatives recorded in Accumulated other comprehensive 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 sales or Cost of sales in the unaudited Condensed Consolidated Statements of Operations. When outstanding derivative contracts mature, actual amounts ultimately reclassified to Net sales or Cost of sales in the unaudited Condensed Consolidated Statements of Operations are dependent on U.S. dollar exchange rates in effect against the euro, renminbi, Canadian dollar, won, and yen as well as the euro exchange rate in effect against the pound sterling. As of March 31, 2025, the Company's derivative contracts had a remaining maturity of less than 3 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 $ 7.7 million as of March 31, 2025. All of the Company's derivative counterparties have credit ratings that are investment grade or higher. The Company is a party to master netting arrangements that contain features that allow counterparties to net settle amounts arising from multiple separate derivative transactions or net settle in the case of certain triggering events such as a bankruptcy or major default of one of the counterparties to the transaction. The Company has not pledged assets or posted collateral as a requirement for entering into or maintaining derivative positions. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 15 The following table presents the balance sheet classification and fair value of derivative instruments: As of (in thousands) Balance Sheet Classification March 31, 2025 December 31, 2024 March 31, 2024 Derivative instruments designated as cash flow hedges: Derivative instruments in asset positions: Currency forward contracts Prepaid expenses and other current assets $ 14,479 $ 20,890 $ 12,864 Currency forward contracts Other non-current assets $ 4,929 $ 9,137 $ 5,423 Derivative instruments in liability positions: Currency forward contracts Accrued liabilities $ 939 $ 853 $ 1,090 Currency forward contracts Other long-term liabilities $ 1,748 $ 13 $ 155 Derivative instruments not designated as cash flow hedges: Derivative instruments in asset positions: Currency forward contracts Prepaid expenses and other current assets $ 2,780 $ 3,739 $ 1,978 Derivative instruments in liability positions: Currency forward contracts Accrued liabilities $ 438 $ 872 $ 828 The following table presents the statement of operations effect and classification of derivative instruments: Statement Of Operations Classification Three Months Ended March 31, (in thousands) 2025 2024 Currency forward contracts: Derivative instruments designated as cash flow hedges: Gain (loss) recognized in other comprehensive income (loss), net of tax — $ ( 5,910 ) $ 11,727 Loss reclassified from accumulated other comprehensive loss to income for the effective portion Net sales $ ( 441 ) $ ( 282 ) Gain reclassified from accumulated other comprehensive loss to income for the effective portion Cost of sales $ 3,131 $ 2,971 Gain reclassified from accumulated other comprehensive loss to income as a result of cash flow hedge discontinuance Other non-operating income, net $ — $ 68 Derivative instruments not designated as cash flow hedges: Gain (loss) recognized in income Other non-operating income, net $ ( 612 ) $ 2,925 NOTE 12 — FAIR VALUE MEASURES Certain assets and liabilities are reported at fair value on either a recurring or nonrecurring basis. 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 | Q1 2025 FORM 10-Q | 16 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements Level 1 — observable inputs such as quoted prices for identical assets or liabilities in active liquid markets; Level 2 — inputs, other than the quoted market prices in active markets, that are observable, either directly or indirectly; or observable market prices in markets with insufficient volume or infrequent transactions; and Level 3 — unobservable inputs for which there is little or no market data available, that require the reporting entity to develop its own assumptions. The Company's assets and liabilities measured at fair value are categorized as Level 1 or Level 2 instruments. Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 instrument valuations are obtained from inputs, other than quoted market prices in active markets, that are directly or indirectly observable in the marketplace and quoted prices in markets with limited volume or infrequent transactions. Assets and liabilities measured at fair value on a recurring basis are as follows: As of March 31, 2025 (in thousands) Level 1 Level 2 Level 3 Total Assets: Cash equivalents: Money market funds $ 364 $ — $ — $ 364 U.S. government treasury bills — 10,158 — 10,158 Time deposits (1) — 39,841 — 39,841 Short-term investments: Available-for-sale short-term investments: (2) U.S. government treasury bills — 333,007 — 333,007 Other short-term investments: Money market funds 247 — — 247 Mutual fund shares 1,822 — — 1,822 Prepaid expenses and other current assets: Derivative financial instruments — 17,259 — 17,259 Other non-current assets: Money market funds 1,801 — — 1,801 Mutual fund shares 27,925 — — 27,925 Derivative financial instruments — 4,929 — 4,929 Total assets measured at fair value $ 32,159 $ 405,194 $ — $ 437,353 Liabilities: Accrued liabilities: Derivative financial instruments $ — $ 1,377 $ — $ 1,377 Other long-term liabilities: Derivative financial instruments — 1,748 — 1,748 Total liabilities measured at fair value $ — $ 3,125 $ — $ 3,125 (1) Time deposits are carried at amortized cost on the unaudited Condensed Consolidated Balance Sheets, which reasonably approximates fair value. (2) Available-for-sale short-term investments have remaining maturities of less than one year. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 17 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements Assets and liabilities measured at fair value on a recurring basis are as follows: As of December 31, 2024 (in thousands) Level 1 Level 2 Level 3 Total Assets: Cash equivalents: Money market funds $ 160,743 $ — $ — $ 160,743 U.S. government treasury bills — 84,622 — 84,622 Time deposits (1) — 22,306 — 22,306 Short-term investments: Available-for-sale short-term investments: (2) U.S. government treasury bills — 281,499 — 281,499 Other short-term investments: Money market funds 384 — — 384 Mutual fund shares 1,725 — — 1,725 Prepaid expenses and other current assets: Derivative financial instruments — 24,629 — 24,629 Other non-current assets: Money market funds 1,263 — — 1,263 Mutual fund shares 29,225 — — 29,225 Derivative financial instruments — 9,137 — 9,137 Total assets measured at fair value $ 193,340 $ 422,193 $ — $ 615,533 Liabilities: Accrued liabilities: Derivative financial instruments $ — $ 1,725 $ — $ 1,725 Other long-term liabilities: Derivative financial instruments — 13 — 13 Total liabilities measured at fair value $ — $ 1,738 $ — $ 1,738 (1) Time deposits are carried at amortized cost on the unaudited Condensed Consolidated Balance Sheets, which reasonably approximates fair value. (2) Available-for-sale short-term investments have remaining maturities of less than one year. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 18 Table of Contents Notes to unaudited Condensed Consolidated Financial Statements Assets and liabilities measured at fair value on a recurring basis are as follows: As of March 31, 2024 (in thousands) Level 1 Level 2 Level 3 Total Assets: Cash equivalents: Money market funds $ 57,144 $ — $ — $ 57,144 U.S. Government treasury bills — 74,828 — 74,828 Time deposits (1) — 40,699 — 40,699 Short-term investments: Available-for-sale short-term investments: (2) U.S. Government treasury bills — 366,982 — 366,982 Other short-term investments: Money market funds 343 — — 343 Mutual fund shares 1,945 — — 1,945 Prepaid expenses and other current assets: Derivative financial instruments — 14,842 — 14,842 Other non-current assets: Money market funds 1,532 — — 1,532 Mutual fund shares 25,449 — — 25,449 Derivative financial instruments — 5,423 — 5,423 Total assets measured at fair value $ 86,413 $ 502,774 $ — $ 589,187 Liabilities: Accrued liabilities: Derivative financial instruments $ — $ 1,918 $ — $ 1,918 Other long-term liabilities: Derivative financial instruments — 155 — 155 Total liabilities measured at fair value $ — $ 2,073 $ — $ 2,073 (1) Time deposits are carried at amortized cost on the unaudited Condensed Consolidated Balance Sheets, which reasonably approximates fair value. (2) Available-for-sale short-term investments have remaining maturities of less than one year. COLUMBIA SPORTSWEAR COMPANY | Q1 2025 FORM 10-Q | 19 Table of Contents