Quarterly report pursuant to Section 13 or 15(d)

Leases

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Leases
3 Months Ended
May 04, 2024
Leases  
Leases

5.Leases

The Company leases retail stores, distribution centers, fast fulfillment centers, market fulfillment centers, corporate offices, and certain equipment under non-cancelable operating leases with various expiration dates through 2036. All leases are classified as operating leases and generally have initial lease terms of 10 years and, when determined applicable, include renewal options under substantially the same terms and conditions as the original leases. Leases do not contain any material residual value guarantees or material restrictive covenants.

Lease cost

The majority of operating lease cost relates to retail stores, distribution centers, fast fulfillment centers, and market fulfillment centers and is classified within cost of sales. Operating lease cost for corporate offices is classified within selling, general and administrative expenses. Operating lease cost from the control date through store opening date is classified within pre-opening expenses.

The following table presents a summary of operating lease costs:

13 Weeks Ended

May 4,

April 29,

(In thousands)

2024

2023

Operating lease cost

$

88,155

$

85,128

Other information

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

    

13 Weeks Ended

May 4,

April 29,

(In thousands)

    

2024

2023

Cash paid for operating lease liabilities (1)

$

101,646

$

98,055

Operating lease assets obtained in exchange for operating lease liabilities (non-cash)

65,176

73,775

(1) Excludes $7,791 and $9,593 related to cash received for tenant incentives for the 13 weeks ended May 4, 2024 and April 29, 2023, respectively.