Segments | 15. Segments The Company’s core operations comprise of Houses, hotels and restaurants across a number of territories, which are managed on a geographical basis. There is a segment managing director for each of the UK, The Americas, Europe and Rest of the World (“RoW”) who is responsible for Houses, hotels and restaurants in that region. Each operating segment manager reports directly to the Company’s Chief Operating Decision Maker (“CODM”), the Chief Executive Officer, Chief Financial Officer and Chief Operating Officer combined. In addition to Houses, hotels and restaurants, the Company offers other products and services, such as retail, home & beauty products and services, which comprise its Retail operating segment; access to Soho Works collaboration spaces across the UK and North America, which comprise its Soho Works operating segment; and memberships for people who live in cities where physical Houses do not exist, which comprise its Cities Without Houses operating segment. The Retail, Soho Works, and Cities Without Houses operating segments also have segment managers which report directly to the CODM and are managed separately from the Houses, hotels and restaurants in each region. The Company has identified the following three reportable segments: • UK, • The Americas, and • Europe and RoW. The Company analyzed the results of the Retail, Soho Works, Soho Restaurants, and Cities Without Houses operating segments and concluded that they did not warrant separate presentation as reportable segments as they do not provide additional useful information to the readers of the financial statements. Therefore, these segments are included as part of an “All Other” category. The historical North America reportable segment has been renamed to The Americas; however, there is no change to the manner in which the segment was previously presented. Intercompany revenues and costs among the reportable segments are not material and are accounted for as if the sales were to third parties because these items are based on negotiated fees between the segments involved. All intercompany transactions and balances are eliminated in consolidation. Intercompany revenues and costs between entities within a reportable segment are eliminated to arrive at segment totals. Segment revenue includes revenue of certain equity method investments, which are considered stand-alone operating segments, which are therefore not included in revenues as part of these consolidated financial statements. Eliminations between segments are separately presented. Corporate results include amounts related to corporate functions such as administrative costs and professional fees. Income tax expense is managed by Corporate on a consolidated basis and is not allocated to the reportable segments. The Company manages and assesses the performance of the reportable segments by Reportable segments EBITDA, which is defined as net income (loss) before depreciation and amortization, interest expense, net, provision (benefit) for income taxes, adjusted to take account of the impact of certain non-cash and other items that the Company does not consider in its evaluation of ongoing operating performance. These other items include, but are not limited to, loss (gain) on sale of property and other, net, share of loss (profit) of equity method investments, foreign exchange, pre-opening expenses, non-cash rent, deferred registration fees, net, share of equity method investments EBITDA, share-based compensation expense, and certain other expenses. The following tables present disaggregated revenue for the 13 weeks and 26 weeks ended June 30, 2024 and July 2, 2023 and the key financial metrics reviewed by the CODM for the Company’s reportable segments: For the 13 Weeks Ended June 30, 2024 (in thousands) The Americas UK Europe Reportable All Total Membership revenues $ 50,389 $ 29,948 $ 13,090 $ 93,427 $ 13,523 $ 106,950 In-House revenues 53,487 48,084 34,568 136,139 66 136,205 Other revenues 19,067 17,074 14,108 50,249 26,115 76,364 Total segment revenue 122,943 95,106 61,766 279,815 39,704 319,519 Elimination of equity accounted revenue ( 3,388 ) ( 1,915 ) ( 9,070 ) ( 14,373 ) — ( 14,373 ) Consolidated revenue $ 119,555 $ 93,191 $ 52,696 $ 265,442 $ 39,704 $ 305,146 For the 13 Weeks Ended July 2, 2023 (in thousands) The Americas UK Europe & Reportable All Total Membership revenues $ 43,810 $ 25,481 $ 11,196 $ 80,487 $ 11,817 $ 92,304 In-House revenues 51,351 48,178 33,863 133,392 — 133,392 Other revenues 20,264 17,778 11,465 49,507 27,953 77,460 Total segment revenue 115,425 91,437 56,524 263,386 39,770 303,156 Elimination of equity accounted revenue ( 3,738 ) ( 1,939 ) ( 8,556 ) ( 14,233 ) — ( 14,233 ) Consolidated revenue $ 111,687 $ 89,498 $ 47,968 $ 249,153 $ 39,770 $ 288,923 For the 26 Weeks Ended June 30, 2024 (in thousands) The Americas UK Europe Reportable All Total Membership revenues $ 98,616 $ 59,016 $ 25,978 $ 183,610 $ 26,923 $ 210,533 In-House revenues 104,678 88,362 58,113 251,153 199 251,352 Other revenues 38,137 30,664 15,250 84,051 48,692 132,743 Total segment revenue 241,431 178,042 99,341 518,814 75,814 594,628 Elimination of equity accounted revenue ( 7,721 ) ( 3,550 ) ( 15,065 ) ( 26,336 ) — ( 26,336 ) Consolidated revenue $ 233,710 $ 174,492 $ 84,276 $ 492,478 $ 75,814 $ 568,292 For the 26 Weeks Ended July 2, 2023 (in thousands) The Americas UK Europe & Reportable All Total Membership revenues $ 85,353 $ 49,178 $ 21,508 $ 156,039 $ 22,614 $ 178,653 In-House revenues 103,403 89,598 61,041 254,042 — 254,042 Other revenues 38,970 33,047 12,582 84,599 52,315 136,914 Total segment revenue 227,726 171,823 95,131 494,680 74,929 569,609 Elimination of equity accounted revenue ( 7,947 ) ( 3,595 ) ( 13,935 ) ( 25,477 ) — ( 25,477 ) Consolidated revenue $ 219,779 $ 168,228 $ 81,196 $ 469,203 $ 74,929 $ 544,132 The following tables present the reconciliation of reportable segment EBITDA to total consolidated segment revenue: For the 13 Weeks Ended June 30, 2024 (in thousands) The Americas UK Europe & Reportable All Total Total consolidated segment revenue $ 119,555 $ 93,191 $ 52,696 $ 265,442 $ 39,704 $ 305,146 Total segment operating expenses ( 98,175 ) ( 63,177 ) ( 51,889 ) ( 213,241 ) ( 41,698 ) ( 254,939 ) Share of equity method investments EBITDA 646 273 1,892 2,811 - 2,811 Reportable segments EBITDA 22,026 30,287 2,699 55,012 ( 1,994 ) 53,018 Unallocated corporate overhead ( 10,636 ) Consolidated Segmental EBITDA 42,382 Depreciation and amortization ( 25,381 ) Interest expense, net ( 19,989 ) Income tax expense ( 4,441 ) Gain on sale of property and other, net 109 Share of income of equity method investments 1,514 Foreign exchange ( 5,173 ) Pre-opening expenses ( 5,652 ) Non-cash rent ( 4,118 ) Deferred registration fees, net 465 Share of equity method investments EBITDA ( 2,811 ) Share-based compensation expense ( 3,598 ) Other expenses, net (1) ( 7,482 ) Net income (loss) $ ( 34,175 ) (1) Other expenses, net include a $ 1 million expense related to third party advisory expenses incurred by the Company's independent special committee in request of the evaluation of certain strategic transactions and a $ 2 million expense incurred with respect to a strategic reorganization program of the Company's operations and support teams. The Company recognized $ 5 million of impairment losses on intangible assets related to the termination of two hotel management contracts. For 13 Weeks Ended July 2, 2023 (in thousands) The Americas UK Europe & Reportable All Total Total consolidated segment revenue $ 111,687 $ 89,498 $ 47,968 $ 249,153 $ 39,770 $ 288,923 Total segment operating expenses ( 90,144 ) ( 70,499 ) ( 42,926 ) ( 203,569 ) ( 42,283 ) ( 245,852 ) Share of equity method investments EBITDA 702 298 1,840 2,840 — 2,840 Reportable segments EBITDA 22,245 19,297 6,882 48,424 ( 2,513 ) 45,911 Unallocated corporate overhead ( 8,419 ) Consolidated segmental EBITDA 37,492 Depreciation and amortization ( 25,249 ) Interest expense, net ( 22,027 ) Income tax expense ( 1,349 ) Loss on sale of property and other, net ( 92 ) Share of income of equity method investments 1,587 Foreign exchange 21,584 Pre-opening expenses ( 4,206 ) Non-cash rent ( 2,105 ) Deferred registration fees, net 465 Share of equity method investments EBITDA ( 2,840 ) Share-based compensation expense ( 5,657 ) Other expenses, net 110 Net income (loss) $ ( 2,287 ) For the 26 Weeks Ended June 30, 2024 (in thousands) The Americas UK Europe & Reportable All Total Total consolidated segment revenue $ 233,710 $ 174,492 $ 84,276 $ 492,478 $ 75,814 $ 568,292 Total segment operating expenses ( 191,116 ) ( 123,392 ) ( 87,995 ) ( 402,503 ) ( 81,318 ) ( 483,821 ) Share of equity method investments adjusted EBITDA 1,392 418 2,741 4,551 — 4,551 Reportable segments EBITDA 43,986 51,518 ( 978 ) 94,526 ( 5,504 ) 89,022 Unallocated corporate overhead ( 21,258 ) Consolidated segmental EBITDA 67,764 Depreciation and amortization ( 51,125 ) Interest expense, net ( 41,188 ) Income tax expense ( 4,940 ) Gain on sale of property and other, net 174 Share of income of equity method investments 1,891 Foreign exchange ( 10,654 ) Pre-opening expenses ( 11,406 ) Non-cash rent ( 4,951 ) Deferred registration fees, net 932 Share of equity method investments adjusted EBITDA ( 4,551 ) Share-based compensation expense ( 11,637 ) Other expenses, net (1) ( 10,823 ) Net loss $ ( 80,514 ) (1) Other expenses, net include a $ 2 million expense related to professional service fees associated with the Company's shareholder activism response, a $ 2 million expense related to third party advisory expenses incurred by the Company's independent special committee in request of the evaluation of certain strategic transactions and a $ 2 million expense incurred with respect to a strategic reorganization program of the Company's operations and support teams. Further, the Company recognized $ 5 million of impairment losses on intangible assets related to the termination of two hotel management contracts. For 26 Weeks Ended July 2, 2023 (in thousands) The Americas UK Europe & Reportable All Total Total consolidated segment revenue $ 219,779 $ 168,228 $ 81,196 $ 469,203 $ 74,929 $ 544,132 Total segment operating expenses ( 173,316 ) ( 133,783 ) ( 76,320 ) ( 383,419 ) ( 80,946 ) ( 464,365 ) Share of equity method investments EBITDA 1,505 478 2,725 4,708 — 4,708 Reportable segments EBITDA 47,968 34,923 7,601 90,492 ( 6,017 ) 84,475 Unallocated corporate overhead ( 18,544 ) Consolidated segmental EBITDA 65,931 Depreciation and amortization ( 49,713 ) Interest expense, net ( 40,728 ) Income tax expense ( 1,178 ) Gain on sale of property and other, net 589 Share of income of equity method investments 2,458 Foreign exchange 34,597 Pre-opening expenses ( 9,200 ) Non-cash rent ( 4,881 ) Deferred registration fees, net 926 Share of equity method investments EBITDA ( 4,708 ) Share-based compensation expense ( 11,503 ) Other expenses, net ( 893 ) Net loss $ ( 18,303 ) The following table presents long-lived asset information (which includes property and equipment, net, operating lease right-of-use assets and equity method investments) by geographic area as of June 30, 2024 and December 31, 2023. Asset information by segment is not reported internally or otherwise regularly reviewed by the CODM. As of (in thousands) June 30, 2024 December 31, 2023 Long-lived assets by geography The Americas $ 933,810 $ 877,071 United Kingdom 550,743 556,628 Europe 295,667 317,502 Asia 38,796 47,694 Total long-lived assets $ 1,819,016 $ 1,798,895 |