The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with "Special Note Regarding Forward
Looking Statements", Part I, Item 1 and Part II, Item 1A of this Quarterly
Report on Form 10-Q. In addition, refer to Item 7 in our Annual Report on Form
10-K for the year ended December 31, 2021 for our discussion and analysis
comparing financial condition and results of operations from 2021 to 2020.


We connect active people with their passions. We are a global leader in
designing, developing, marketing, and distributing outdoor, active and everyday
lifestyle products. We manage these products in two categories: apparel,
accessories, and equipment products and footwear products. We provide our
products through our four well-known brands: Columbia, SOREL, Mountain Hardwear,
and prAna. Apparel, accessories, and equipment products are provided by our
Columbia, Mountain Hardwear and prAna brands. Footwear products are provided by
our Columbia and SOREL brands. We sell our products in approximately 90
countries and operate in four geographic segments: U.S., LAAP, EMEA, and Canada.

We are committed to generating long-term sustainable and profitable growth and investing in our strategic priorities to:

• Drive brand awareness and sales growth through increased and targeted investment in demand creation;

•enhancing customer experience and digital capabilities across all our channels and geographies;

•expand and improve DTC’s global operations with supporting processes and systems; and

•invest in our people and optimize our organization across our portfolio of

                               COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 17
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Ultimately, we expect our investments to enable market share capture across our
brand portfolio, expand gross margin, improve selling, general and
administrative expense efficiency, and drive improved operating margin over the

Business environment and trends

Increased Outdoor Participation by Consumers | The COVID-19 pandemic drew a
record number of individuals in the United States to spend an increased amount
of time outside, including participating in outdoor recreational activities.
While outdoor participation rates may not be maintained, we believe that our
addressable consumer base worldwide has been expanded and expect outdoor
participation to remain elevated in comparison to pre-pandemic levels.

Casualization of the Apparel and Footwear Market | During the COVID-19 pandemic,
we saw a move to casualization by consumers. Our products provide comfort and
function in diverse environments. We believe we have benefited from this trend
and expect it to continue to be a tailwind moving forward.

Decreased Promotional Environment | In the first quarter of 2022, we operated in
a low promotional environment and experienced fewer order cancellations, sales
returns and customer accommodations than historically experienced. We expect
these trends to remain favorable in early 2022 and expect a gradual return to a
more normalized promotional environment and transition towards more normalized
trading terms. For 2022, we do not expect these metrics to return to levels
experienced in 2019 and prior years.

Lean Inventory Across the Marketplace | Consumer demand acceleration coupled
with supply chain constraints in 2021 resulted in lower inventory in the
marketplace at the start of 2022. Given ongoing supply chain disruptions and the
imbalance between global supply and demand, we expect marketplace inventories to
remain low until supply chain constraints ease. In addition, retailers may
choose to carry less inventory than pre-pandemic levels and instead rely on
replenishments, to the extent possible.

Changes in Consumer Spending Ability and Preferences | We believe government
stimulus and unemployment benefits increased consumers' discretionary spending
ability in 2021 and 2020. In addition, we believe we benefited as consumers
shifted from service-based to product-based spending due to their limited
ability to travel, attend entertainment-based experiences or purchase certain
services. For 2022, we have experienced and expect to continue to experience a
reduction of these tailwinds.

Decreased Direct-to-Consumer Store Traffic | For the first quarter of 2022, the
majority of our stores remained open. At varying times, government efforts to
control the spread of COVID-19 impacted our stores in China. Overall, our global
store retail traffic trends continue to improve, with our U.S. retail store
traffic recovering to pre-pandemic levels in the first quarter of 2022. While
store traffic is improving, we expect it to continue to remain uneven across our
store fleet by region, depending on regional impacts of the virus and government

Increased Freight Charges | In the first quarter of 2022, we experienced
elevated ocean freight charges as a result of an imbalance of supply and demand
for steamship and ocean container capacity and changes in our ocean freight
sourcing practices. We expect our ocean freight charges to be reduced in the
latter part of 2022. However, the imbalance in the marketplace persists and
ocean freight costs will remain elevated compared to historical norms.
Additionally, recent increases in oil prices have resulted in fuel surcharges
from certain of our freight carriers that deliver product to our retail stores
and to consumers.

Later Inventory Receipts | During the third quarter of 2021, several weeks of
government mandated factory closures in Vietnam disrupted our manufacturing
partners' operations and impacted production of Fall 2021 and Spring 2022
product. In addition, port congestion and shortages in transportation and labor
further slowed the transportation of our inventory. As a result of these supply
chain disruptions, we received Fall 2021 inventory later than expected, and
continue to receive Spring 2022 inventory later than originally planned. We
expect the supply chain transit time to modestly improve by late 2022. However,
we continue to anticipate longer than historical transit times for inventory
receipts and shipments to our wholesale customers and inventory available for
our DTC businesses in 2022, potentially resulting in impacts to future net sales
and gross margin.

Manufacturing Capacity Constraints | In 2021, we experienced footwear
manufacturing capacity constraints which prevented us from securing footwear
product to fully meet demand. Although we are growing footwear manufacturing
capacity in 2022, we again expect demand to outstrip capacity due to anticipated
footwear sales growth rates. We anticipate being able to meet footwear demand
with appropriate supply in 2023.

Continued Labor Shortages | Labor shortages continue to be prevalent in the U.S.
and labor costs have risen in an effort to compete for employees. We have made
certain wage adjustments in an effort to be more competitive in the current
environment and have diminished the effects of current labor shortages on our
operations at this time. However, we anticipate rising costs and labor shortages
to continue in 2022 resulting from the continued competition for talent.

                               COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 18
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Increased Inflationary Pressures | Inflationary pressures, including increased
inbound freight costs, impacted our results in the first quarter of 2022. In
addition to increased inbound freight costs, we expect increased product input
costs, including higher wages and raw materials costs, to impact our results
throughout 2022. We implemented product price increases for our Spring 2022
season and, to a greater extent, for our Fall 2022 season. We do not expect
planned price increases will fully offset gross margin pressure, particularly
the effect of increased inbound freight costs. Price increases varied by market
and product category. In the U.S., on average, we increased pricing by a
mid-single digit percent for our Spring 2022 product line and by a high-single
to low-double-digit percent for our Fall 2022 product line. Over time, we
anticipate ocean freight and raw material cost inflation will moderate, while
wage inflation will be more permanent.

Changing Geopolitical Environment | The macro-geopolitical environment has
rapidly changed as a result of the invasion of Ukraine by Russian forces. We do
not have any direct operations in Russia and historically have operated in that
market through a contract with a third-party international distributor on an
advance order basis. As a result of the conflict in Ukraine, we paused taking
any new orders from this distributor. The impact of the invasion is being felt
not only in our relationship with our third-party international distributor, but
also in political relationships throughout the globe. These political tensions
have the potential to manifest themselves in certain regions where we directly

Changing Consumer Expectations | Consumer behavior continues to fluctuate.
Consumer expectations and the related competitive pressures have increased and
continue to increase relative to various aspects of our e-commerce business,
including speed of product delivery, shipping charges, return privileges and
other evolving expectations. We maintain and continue to make substantial
investments in information systems, processes and personnel to support our
ongoing demand planning efforts to provide forecasting of optimal inventory to
meet customer and consumer demands.

Seasonality | Our business is affected by the general seasonal trends common to
the industry, including seasonal weather and discretionary consumer shopping and
spending patterns. Our products are marketed on a seasonal basis, and our sales
are weighted substantially toward the third and fourth quarters, while our
operating costs are more equally distributed throughout the year. In 2021, over
60% of our net sales and over 75% of our operating income were realized in the
second half of the year.


The following discussion of our results of operations and liquidity and capital
resources should be read in conjunction with Item 1 of this Quarterly Report on
Form 10-Q. All references to quarters relate to the quarter ended March 31 of
that particular year.

Non-GAAP Financial Measure

To supplement financial information reported in accordance with accounting
principles generally accepted in the United States ("GAAP"), we disclose
constant-currency net sales information, which is a non-GAAP financial measure,
to provide a framework to assess how the business performed excluding the
effects of changes in foreign currency exchange rates against the United States
dollar between comparable reporting periods. We calculate constant-currency net
sales by translating net sales in foreign currencies for the current period into
United States dollars at the exchange rates that were in effect during the
comparable period of the prior year. Management believes that this non-GAAP
financial measure reflects an additional and useful way of viewing an aspect of
our operations that, when viewed in conjunction with our GAAP results, provides
a more comprehensive understanding of our business and operations. In
particular, investors may find the non-GAAP measure useful by reviewing our net
sales results without the volatility in foreign currency exchange rates. This
non-GAAP financial measure also facilitates management's internal comparisons to
our historical net sales results and comparisons to competitors' net sales
results. Constant-currency financial measures should be viewed in addition to,
and not in lieu of or superior to, our financial measures calculated in
accordance with GAAP.

The following discussion includes references to constant currency net sales, and we provide a reconciliation of this non-GAAP measure to the most directly comparable financial measure calculated in accordance with GAAP below.

                               COLUMBIA SPORTSWEAR COMPANY | 2022 FORM 10-Q | 19


  Notes to   Condensed Consolidated                                         

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Financial statements (unaudited)

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