WALMART INC., 10-K filed on 3/28/2019
Annual Report
v3.19.1
Document And Entity Information - USD ($)
12 Months Ended
Jan. 31, 2019
Mar. 26, 2019
Jul. 31, 2018
Document And Entity Information [Abstract]      
Entity Registrant Name WALMART INC.    
Entity Central Index Key 0000104169    
Current Fiscal Year End Date --01-31    
Entity Filer Category Large Accelerated Filer    
Document Type 10-K    
Document Period End Date Jan. 31, 2019    
Document Fiscal Year Focus 2019    
Document Fiscal Period Focus FY    
Amendment Flag false    
Entity Common Stock, Shares Outstanding   2,869,684,230  
Entity Voluntary Filers No    
Entity Small Business false    
Entity Emerging Growth Company false    
Entity Well-known Seasoned Issuer Yes    
Entity Current Reporting Status Yes    
Entity Shell Company false    
Entity Public Float     $ 126,810,267,035
v3.19.1
Consolidated Statements of Income - USD ($)
shares in Millions, $ in Millions
12 Months Ended
Jan. 31, 2019
Jan. 31, 2018
Jan. 31, 2017
Revenues:      
Net Sales $ 510,329 $ 495,761 $ 481,317
Membership and other income 4,076 4,582 4,556
Total revenues 514,405 500,343 485,873
Costs and expenses:      
Cost of sales 385,301 373,396 361,256
Operating, selling, general and administrative expenses 107,147 106,510 101,853
Operating income 21,957 20,437 22,764
Interest:      
Debt 1,975 1,978 2,044
Capital lease and financing obligations 371 352 323
Interest income (217) (152) (100)
Interest, net 2,129 2,178 2,267
Loss on extinguishment of debt 0 3,136 0
Other (gains) and losses 8,368 0 0
Income before income taxes 11,460 15,123 20,497
Provision for income taxes 4,281 4,600 6,204
Consolidated net income 7,179 10,523 14,293
Consolidated net income attributable to noncontrolling interest (509) (661) (650)
Consolidated net income attributable to Walmart $ 6,670 $ 9,862 $ 13,643
Net income per common share:      
Basic net income per common share attributable to Walmart $ 2.28 $ 3.29 $ 4.40
Diluted net income per common share attributable to Walmart $ 2.26 $ 3.28 $ 4.38
Weighted-average common shares outstanding:      
Basic 2,929 2,995 3,101
Diluted 2,945 3,010 3,112
Dividends declared per common share $ 2.08 $ 2.04 $ 2.00
v3.19.1
Consolidated Statements of Comprehensive Income - USD ($)
$ in Millions
12 Months Ended
Jan. 31, 2019
Jan. 31, 2018
Jan. 31, 2017
Consolidated net income $ 7,179 $ 10,523 $ 14,293
Consolidated net income attributable to noncontrolling interest (509) (661) (650)
Consolidated net income attributable to Walmart 6,670 9,862 13,643
Other comprehensive income (loss), net of income taxes      
Currency translation and other (226) 2,540 (3,027)
Minimum pension liability 131 147 (397)
Unrealized gain on available-for-sale securities 0 1,501 145
Other comprehensive income (loss), net of income taxes (113) 4,220 (2,845)
Less other comprehensive income (loss) attributable to noncontrolling interest 188 (169) 210
Other comprehensive income (loss) attributable to Walmart 75 4,051 (2,635)
Comprehensive income, net of income taxes 7,066 14,743 11,448
Comprehensive (income) loss attributable to noncontrolling interest (321) (830) (440)
Comprehensive income attributable to Walmart 6,745 13,913 11,008
Net investment hedging      
Other comprehensive income (loss), net of income taxes      
Derivative instruments 272 (405) 413
Cash flow hedging      
Other comprehensive income (loss), net of income taxes      
Derivative instruments $ (290) $ 437 $ 21
v3.19.1
Consolidated Balance Sheets - USD ($)
$ in Millions
Jan. 31, 2019
Jan. 31, 2018
Current assets:    
Cash and cash equivalents $ 7,722 $ 6,756
Receivables, net 6,283 5,614
Inventories 44,269 43,783
Prepaid expenses and other 3,623 3,511
Total current assets 61,897 59,664
Property and equipment:    
Property and equipment 185,810 185,154
Less accumulated depreciation (81,493) (77,479)
Property and equipment, net 104,317 107,675
Property under capital lease and financing obligations:    
Property under capital lease and financing obligations 12,760 12,703
Less accumulated amortization (5,682) (5,560)
Property under capital lease and financing obligations, net 7,078 7,143
Goodwill 31,181 18,242
Other long-term assets 14,822 11,798
Total assets 219,295 204,522
Current liabilities:    
Short-term borrowings 5,225 5,257
Accounts payable 47,060 46,092
Accrued liabilities 22,159 22,122
Accrued income taxes 428 645
Long-term debt due within one year 1,876 3,738
Capital lease and financing obligations due within one year 729 667
Total current liabilities 77,477 78,521
Long-term debt 43,520 30,045
Long-term capital lease and financing obligations 6,683 6,780
Deferred income taxes and other 11,981 8,354
Commitments and contingencies
Equity:    
Common stock 288 295
Capital in excess of par value 2,965 2,648
Retained earnings 80,785 85,107
Accumulated other comprehensive loss (11,542) (10,181)
Total Walmart shareholders' equity 72,496 77,869
Noncontrolling interest 7,138 2,953
Total equity 79,634 80,822
Total liabilities and equity $ 219,295 $ 204,522
v3.19.1
Consolidated Statement Of Shareholders' Equity and Redeemable Noncontrolling Interest - USD ($)
shares in Millions, $ in Millions
Total
Common stock
Capital in excess of par value
Retained earnings
Accumulated other comprehensive income (loss)
Total Walmart shareholders' equity
Noncontrolling interest
Consolidated net income $ 14,293     $ 13,643   $ 13,643 $ 650
Other comprehensive income (loss), net of income taxes (2,845)       $ (2,635) (2,635) (210)
Balances, in shares at Jan. 31, 2016   3,162          
Balances at Jan. 31, 2016 83,611 $ 317 $ 1,805 90,021 (11,597) 80,546 3,065
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Cash dividends declared (6,216)     (6,216)   (6,216)  
Purchase of Company stock (in shares)   (120)          
Purchase of Company stock (8,276) $ (12) (174) (8,090)   (8,276)  
Cash dividend declared to noncontrolling interest (519)           (519)
Other, in shares   6          
Other 487 $ 0 740 (4)   736 (249)
Balances, in shares at Jan. 31, 2017   3,048          
Balances at Jan. 31, 2017 80,535 $ 305 2,371 89,354 (14,232) 77,798 2,737
Consolidated net income 10,523     9,862   9,862 661
Other comprehensive income (loss), net of income taxes 4,220       4,051 4,051 169
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Cash dividends declared (6,124)     (6,124)   (6,124)  
Purchase of Company stock (in shares)   (103)          
Purchase of Company stock (8,204) $ (10) (219) (7,975)   (8,204)  
Cash dividend declared to noncontrolling interest (687)           (687)
Other, in shares   7          
Other 559   496 (10)   486 73
Balances, in shares at Jan. 31, 2018   2,952          
Balances at Jan. 31, 2018 80,822 $ 295 2,648 85,107 (10,181) 77,869 2,953
Adoption of new accounting standards on February 1, 2018, net of income taxes 924     2,361 (1,436) 925 (1)
Consolidated net income 7,179     6,670   6,670 509
Other comprehensive income (loss), net of income taxes (113)       75 75 (188)
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Cash dividends declared (6,102)     (6,102)   (6,102)  
Purchase of Company stock (in shares)   (80)          
Purchase of Company stock (7,487) $ (8) (245) (7,234)   (7,487)  
Cash dividend declared to noncontrolling interest (488)           (488)
Noncontrolling interest of acquired entity 4,345           4,345
Other, in shares   (6)          
Other 554 $ 1 562 (17)   546 8
Balances, in shares at Jan. 31, 2019   2,878          
Balances at Jan. 31, 2019 $ 79,634 $ 288 $ 2,965 $ 80,785 $ (11,542) $ 72,496 $ 7,138
v3.19.1
Consolidated Statement Of Shareholders' Equity and Redeemable Noncontrolling Interest (Parenthetical) - $ / shares
12 Months Ended
Jan. 31, 2019
Jan. 31, 2018
Jan. 31, 2017
Statement of Stockholders' Equity [Abstract]      
Dividends declared per common share $ 2.08 $ 2.04 $ 2.00
v3.19.1
Consolidated Statements of Cash Flows - USD ($)
$ in Millions
12 Months Ended
Jan. 31, 2019
Jan. 31, 2018
Jan. 31, 2017
Cash flows from operating activities:      
Consolidated net income $ 7,179 $ 10,523 $ 14,293
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:      
Depreciation and amortization 10,678 10,529 10,080
Unrealized Gain (Loss) on Investments 3,516 0 0
(Gains) and losses for disposal of business operations 4,850 0 0
Deferred income taxes (499) (304) 761
Loss on extinguishment of debt 0 3,136 0
Other operating activities 1,734 1,210 206
Changes in certain assets and liabilities, net of effects of acquisitions:      
Receivables, net (368) (1,074) (402)
Inventories (1,311) (140) 1,021
Accounts payable 1,831 4,086 3,942
Accrued liabilities 183 928 1,280
Accrued income taxes (40) (557) 492
Net cash provided by operating activities 27,753 28,337 31,673
Cash flows from investing activities:      
Payments for property and equipment (10,344) (10,051) (10,619)
Proceeds from the disposal of property and equipment 519 378 456
Proceeds from the disposal of certain operations 876 1,046 662
Purchase of available for sale securities 0 0 (1,901)
Payments for business acquisitions, net of cash acquired (14,656) (375) (2,463)
Other investing activities (431) (77) (31)
Net cash used in investing activities (24,036) (9,079) (13,896)
Cash flows from financing activities:      
Net change in short-term borrowings (53) 4,148 (1,673)
Proceeds from issuance of long-term debt 15,872 7,476 137
Repayments of long-term debt (3,784) (13,061) (2,055)
Premiums paid to extinguish debt 0 (3,059) 0
Dividends paid (6,102) (6,124) (6,216)
Purchase of Company stock (7,410) (8,296) (8,298)
Dividends paid to noncontrolling interest (431) (690) (479)
Purchase of noncontrolling interest 0 (8) (90)
Other financing activities (629) (261) (398)
Net cash used in financing activities (2,537) (19,875) (19,072)
Effect of Exchange Rate on Cash, Cash Equivalents, and Restricted Cash (438) 487 (452)
Net increase (decrease) in cash, cash equivalents and restricted cash 742 (130) (1,747)
Cash, cash equivalents and restricted cash at beginning of year 7,014 7,144 8,891
Cash, cash equivalents and restricted cash at end of period 7,756 7,014 7,144
Supplemental disclosure of cash flow information:      
Income taxes paid 3,982 6,179 4,507
Interest paid $ 2,348 $ 2,450 $ 2,351
v3.19.1
Summary of Significant Accounting Policies
12 Months Ended
Jan. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of presentation
Summary of Significant Accounting Policies
General
Walmart Inc. ("Walmart" or the "Company") helps people around the world save money and live better – anytime and anywhere – by providing the opportunity to shop in retail stores and through eCommerce. Through innovation, the Company is striving to continuously improve a customer-centric experience that seamlessly integrates eCommerce and retail stores in an omni-channel offering that saves time for its customers. Each week, the Company serves over 275 million customers who visit its more than 11,300 stores and numerous eCommerce websites under 58 banners in 27 countries.
The Company's operations comprise three reportable segments: Walmart U.S., Walmart International and Sam's Club.
Principles of Consolidation
The Consolidated Financial Statements include the accounts of Walmart and its subsidiaries as of and for the fiscal years ended January 31, 2019 ("fiscal 2019"), January 31, 2018 ("fiscal 2018") and January 31, 2017 ("fiscal 2017"). Intercompany accounts and transactions have been eliminated in consolidation. The Company consolidates variable interest entities where it has been determined that the Company is the primary beneficiary of those entities' operations. Investments for which the Company exercises significant influence but does not have control are accounted for under the equity method. These variable interest entities and equity method investments are immaterial to the Company's Consolidated Financial Statements.
The Company's Consolidated Financial Statements are based on a fiscal year ending on January 31 for the United States ("U.S.") and Canadian operations. The Company consolidates all other operations generally using a one-month lag and based on a calendar year. There were no significant intervening events during the month of January 2019 related to the operations consolidated using a lag that materially affected the Consolidated Financial Statements.
Use of Estimates
The Consolidated Financial Statements have been prepared in conformity with U.S. generally accepted accounting principles. Those principles require management to make estimates and assumptions that affect the reported amounts of assets and liabilities. Management's estimates and assumptions also affect the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may differ from those estimates.
Cash and Cash Equivalents
The Company considers investments with a maturity when purchased of three months or less to be cash equivalents. All credit card, debit card and electronic transfer transactions that process in less than seven days are classified as cash and cash equivalents. The amounts due from banks for these transactions classified as cash and cash equivalents totaled $1.4 billion and $1.6 billion as of January 31, 2019 and 2018, respectively.
The Company's cash balances are held in various locations around the world. Substantially all of the Company's $7.7 billion and $6.8 billion of cash and cash equivalents as of January 31, 2019 and January 31, 2018 were held outside of the U.S. Cash and cash equivalents held outside of the U.S. are generally utilized to support liquidity needs in the Company's non-U.S. operations.
The Company uses intercompany financing arrangements in an effort to ensure cash can be made available in the country in which it is needed with the minimum cost possible. During fiscal 2019, the Company repatriated to the U.S. $5.3 billion of cash at a tax cost of approximately $40 million.
As of January 31, 2019 and 2018, cash and cash equivalents of approximately $2.8 billion and $1.4 billion, respectively, may not be freely transferable to the U.S. due to local laws or other restrictions. Of the $2.8 billion as of January 31, 2019, approximately $1.2 billion can only be accessed through dividends or intercompany financing arrangements subject to approval of Flipkart Private Limited ("Flipkart") minority shareholders; however, this cash is expected to be utilized to fund the operations of Flipkart.
Restricted Cash
In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows–Restricted Cash (Topic 230), which requires restricted cash to be included with cash and cash equivalents when reconciling the beginning and ending amounts on the statement of cash flows. The Company adopted this ASU on February 1, 2018. Restricted cash held outside of cash and cash equivalents was $34 million as of January 31, 2019, primarily recorded in prepaid expenses and other in the Consolidated Balance Sheets, and $300 million as of January 31, 2018, primarily recorded in other long-term assets in the Consolidated Balance Sheets.
Receivables
Receivables are stated at their carrying values, net of a reserve for doubtful accounts, and are primarily due from the following: insurance companies resulting from pharmacy sales; banks for customer credit and debit cards and electronic bank transfers that take in excess of seven days to process; governments for income taxes; suppliers for marketing or incentive programs; and real estate transactions.
Inventories
The Company values inventories at the lower of cost or market as determined primarily by the retail inventory method of accounting, using the last-in, first-out ("LIFO") method for Walmart U.S. segment's inventories. The inventory at the Walmart International segment is valued primarily by the retail inventory method of accounting, using the first-in, first-out ("FIFO") method. The retail inventory method of accounting results in inventory being valued at the lower of cost or market, since permanent markdowns are immediately recorded as a reduction of the retail value of inventory. The inventory at the Sam's Club segment is valued using the weighted-average cost LIFO method. As of January 31, 2019 and January 31, 2018, the Company's inventories valued at LIFO approximated those inventories as if they were valued at FIFO.
Assets Held for Sale
Assets held for sale represent components and businesses that meet accounting requirements to be classified as held for sale and are presented as single asset and liability amounts in the Company's financial statements with a valuation allowance, if necessary, to recognize the net carrying amount at the lower of cost or fair value, less costs to sell.  The Company reviews all businesses and assets held for sale each reporting period to determine whether the existing carrying amounts are fully recoverable in comparison to estimated fair values.  As of January 31, 2019 and January 31, 2018, immaterial amounts for assets and liabilities held for sale were classified in prepaid expenses and other and accrued liabilities, respectively, in the Consolidated Balance Sheets.
Property and Equipment
Property and equipment are initially recorded at cost. Gains or losses on disposition are recognized as earned or incurred. Costs of major improvements are capitalized, while costs of normal repairs and maintenance are expensed as incurred. The following table summarizes the Company's property and equipment balances and includes the estimated useful lives that are generally used to depreciate the assets on a straight-line basis:
 
 
 
 
As of January 31,
(Amounts in millions)
 
Estimated Useful Lives
 
2019
 
2018
Land
 
N/A
 
$
24,526

 
$
25,298

Buildings and improvements
 
3-40 years
 
101,006

 
101,155

Fixtures and equipment
 
1-30 years
 
54,488

 
52,695

Transportation equipment
 
3-15 years
 
2,316

 
2,387

Construction in progress
 
N/A
 
3,474

 
3,619

Property and equipment
 
 
 
$
185,810

 
$
185,154

Accumulated depreciation
 
 
 
(81,493
)
 
(77,479
)
Property and equipment, net
 
 
 
$
104,317

 
$
107,675


Leasehold improvements are depreciated or amortized over the shorter of the estimated useful life of the asset or the remaining expected lease term. Total depreciation and amortization expense for property and equipment, property under financing obligations, property under capital leases and intangible assets for fiscal 2019, 2018 and 2017 was $10.7 billion, $10.5 billion and $10.1 billion, respectively.
Leases
The Company leases land, buildings, fixtures and equipment and transportation equipment. The Company estimates the expected lease term by assuming the exercise of renewal options where an economic penalty exists that would preclude the abandonment of the lease at the end of the initial non-cancelable term and the exercise of such renewal is at the sole discretion of the Company. The expected lease term is used in the determination of whether a store or club lease is a capital or operating lease and in the calculation of straight-line rent expense. Additionally, the useful life of leasehold improvements is limited by the expected lease term or the economic life of the asset, whichever is shorter. If significant expenditures are made for leasehold improvements late in the expected lease term and renewal is reasonably assured, the useful life of the leasehold improvement is limited to the end of the renewal period or economic life of the asset, whichever is shorter. Rent abatements and escalations are considered in the calculation of minimum lease payments in the Company's capital lease tests and in determining straight-line rent expense for operating leases.
The Company is often involved in the construction of its leased stores. In certain cases, payments made for certain structural components included in the lessor's construction of the leased assets result in the Company being deemed the owner of the leased assets for accounting purposes. As a result, the payments, regardless of the significance, are automatic indicators of ownership and require the Company to capitalize the lessor's total project cost with a corresponding financing obligation. Upon completion of the lessor's project, the Company performs a sale-leaseback analysis to determine if these assets and the related financing obligation can be derecognized from the Company's Consolidated Balance Sheets. If the Company is deemed to have "continuing involvement," the leased assets and the related financing obligation remain on the Company's Consolidated Balance Sheets and are generally amortized over the lease term. At the end of the lease term, including exercise of any renewal options, the net remaining financing obligation over the net carrying value of the fixed asset will be recognized as a non-cash gain.
Long-Lived Assets
Long-lived assets are initially recorded at cost. Management reviews long-lived assets for indicators of impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The evaluation is performed at the lowest level of identifiable cash flows, which is at the individual store or club level. Undiscounted cash flows expected to be generated by the related assets are estimated over the assets' useful lives based on updated projections. If the evaluation indicates that the carrying amount of the assets may not be recoverable, any potential impairment is measured based upon the fair value of the related asset or asset group as determined by an appropriate market appraisal or other valuation technique.
Goodwill and Other Acquired Intangible Assets
Goodwill represents the excess of the purchase price over the fair value of net assets acquired in business combinations and is allocated to the appropriate reporting unit when acquired. Other acquired intangible assets are stated at the fair value acquired as determined by a valuation technique commensurate with the intended use of the related asset. Goodwill and indefinite-lived intangible assets are not amortized; rather, they are evaluated for impairment annually and whenever events or changes in circumstances indicate that the value of the asset may be impaired. Definite-lived intangible assets are considered long-lived assets and are amortized on a straight-line basis over the periods that expected economic benefits will be provided.
Goodwill is assigned to the reporting unit which consolidates the acquisition. Components within the same reportable segment are aggregated and deemed a single reporting unit if the components have similar economic characteristics. As of January 31, 2019, the Company's reporting units consisted of Walmart U.S., Walmart International and Sam's Club. Goodwill is evaluated for impairment using either a qualitative or quantitative approach for each of the Company's reporting units. Generally, a qualitative assessment is first performed to determine whether a quantitative goodwill impairment test is necessary. If management determines, after performing an assessment based on the qualitative factors, that the fair value of the reporting unit is more likely than not less than the carrying amount, or that a fair value of the reporting unit substantially in excess of the carrying amount cannot be assured, then a quantitative goodwill impairment test would be required. The quantitative test for goodwill impairment is performed by determining the fair value of the related reporting units. Fair value is measured based on the discounted cash flow method and relative market-based approaches. After evaluation, management determined the fair value of each reporting unit is greater than the carrying amount and, accordingly, the Company has not recorded any impairment charges related to goodwill.
The following table reflects goodwill activity, by reportable segment, for fiscal 2019 and 2018:
(Amounts in millions)
 
Walmart U.S.
 
Walmart
International
 
Sam's Club
 
Total
Balances as of February 1, 2017
 
$
2,236

 
$
14,488

 
$
313

 
$
17,037

Changes in currency translation and other
 

 
996

 

 
996

Acquisitions
 
209

 

 

 
209

Balances as of January 31, 2018
 
2,445

 
15,484

 
313

 
18,242

Changes in currency translation and other
 

 
(743
)
 

 
(743
)
Acquisitions (1)
 
107

 
13,575

 

 
13,682

Balances as of January 31, 2019
 
$
2,552

 
$
28,316

 
$
313

 
$
31,181


(1) Goodwill recorded in fiscal 2019 for Walmart International relates to Flipkart.
Intangible assets are included in other long-term assets in the Company's Consolidated Balance Sheets. These assets are evaluated for impairment based on their fair values using valuation techniques which are updated annually based on the most recent variables and assumptions. There were no significant impairment charges related to intangible assets for fiscal 2019, 2018 and 2017.
Fair Value Measurement
In January 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-01, Financial Instruments–Overall (Topic 825), which updated certain aspects of recognition, measurement, presentation and disclosure of financial instruments ("ASU 2016-01"). The Company adopted this ASU on February 1, 2018, which primarily impacted the Company's accounting for its investment in JD.com, Inc. ("JD") and resulted in a positive adjustment to retained earnings of approximately $2.6 billion, net of tax, based on the market value of the Company's investment in JD as of January 31, 2018. The adoption required prospective changes in fair value of the Company's investment in JD to be recorded in the Consolidated Statement of Income, which the Company classifies in other gains and losses.
The Company records and discloses certain financial and non-financial assets and liabilities at fair value. The fair value of an asset is the price at which the asset could be sold in an orderly transaction between unrelated, knowledgeable and willing parties able to engage in the transaction. The fair value of a liability is the amount that would be paid to transfer the liability to a new obligor in a transaction between such parties, not the amount that would be paid to settle the liability with the creditor.
Self Insurance Reserves
The Company self-insures a number of risks, including, but not limited to, workers' compensation, general liability, auto liability, product liability and certain employee-related healthcare benefits. Standard actuarial procedures and data analysis are used to estimate the liabilities associated with these risks as of the balance sheet date on an undiscounted basis. The recorded liabilities reflect the ultimate cost for claims incurred but not paid and any estimable administrative run-out expenses related to the processing of these outstanding claim payments. On a regular basis, the liabilities are evaluated for appropriateness with claims reserve valuations. To limit exposure to some risks, the Company maintains insurance coverage with varying limits and retentions, including stop-loss insurance coverage for workers' compensation, general liability and auto liability.
Derivatives
The Company uses derivatives for hedging purposes to manage its exposure to changes in interest and currency exchange rates, as well as to maintain an appropriate mix of fixed- and variable-rate debt. Use of derivatives in hedging programs subjects the Company to certain risks, such as market and credit risks. Market risk represents the possibility that the value of the derivatives will change. In a hedging relationship, the change in the value of the derivative is offset to a great extent by the change in the value of the underlying hedged item. Credit risk related to a derivative represents the possibility that the counterparty will not fulfill the terms of the contract. Credit risk is monitored through established approval procedures, including setting concentration limits by counterparty, reviewing credit ratings and requiring collateral from the counterparty when appropriate. The Company only enters into derivatives with counterparties rated "A-" or better by nationally recognized credit rating agencies. Subsequent to entering into derivatives, the Company regularly monitors the credit ratings of its counterparties. The notional, or contractual, amount of the Company's derivatives is used to measure interest to be paid or received and does not represent the Company's exposure due to credit risk.
The contractual terms of the Company's derivatives closely mirror those of the hedged items, providing a high degree of risk reduction and correlation. Contracts that are effective at meeting the risk reduction and correlation criteria are recorded using hedge accounting. If a derivative is recorded using hedge accounting, depending on the nature of the hedge, changes in fair value will either be offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings or be recognized in accumulated other comprehensive loss until the hedged item is recognized in earnings. Any hedge ineffectiveness is immediately recognized in earnings. The Company's net investment and cash flow hedges are highly effective and the ineffective portion has not been, and is not expected to be, significant. Derivatives that do not meet the criteria for hedge accounting, or contracts for which the Company has not elected hedge accounting, are recorded at fair value with unrealized gains or losses reported in earnings during the period of the change.
Fair Value Hedges
The Company is a party to receive fixed-rate, pay variable-rate interest rate swaps that the Company uses to hedge the fair value of fixed-rate debt. The notional amounts are used to measure interest to be paid or received and do not represent the Company's exposure due to credit loss. The Company's interest rate swaps that receive fixed-interest rate payments and pay variable-interest rate payments are designated as fair value hedges. As the specific terms and notional amounts of the derivatives match those of the fixed-rate debt being hedged, the derivatives are assumed to be perfectly effective hedges. Changes in the fair values of these derivatives are recorded in earnings, but are offset by corresponding changes in the fair values of the hedged items, also recorded in earnings, and, accordingly, do not impact the Company's Consolidated Statements of Income. These derivatives will mature on dates ranging from October 2020 to April 2024.
Net Investment Hedges
The Company is a party to cross-currency interest rate swaps that the Company uses to hedge its net investments. The agreements are contracts to exchange fixed-rate payments in one currency for fixed-rate payments in another currency. All changes in the fair value of these derivatives are recorded in accumulated other comprehensive loss, offsetting the currency translation adjustment of the related investment that is also recorded in accumulated other comprehensive loss. These derivatives will mature on dates ranging from July 2020 to February 2030.
The Company has issued foreign-currency-denominated long-term debt as hedges of net investments of certain of its foreign operations. These foreign-currency-denominated long-term debt issuances are designated and qualify as nonderivative hedging instruments. Accordingly, the foreign currency translation of these debt instruments is recorded in accumulated other comprehensive loss, offsetting the foreign currency translation adjustment of the related net investment that is also recorded in accumulated other comprehensive loss.
Cash Flow Hedges
The Company is a party to receive fixed-rate, pay fixed-rate cross-currency interest rate swaps to hedge the currency exposure associated with the forecasted payments of principal and interest of certain non-U.S. denominated debt. The swaps are designated as cash flow hedges of the currency risk related to payments on the non-U.S. denominated debt. The effective portion of changes in the fair value of derivatives designated as cash flow hedges of foreign exchange risk is recorded in accumulated other comprehensive loss and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. The hedged items are recognized foreign currency-denominated liabilities that are re-measured at spot exchange rates each period, and the assessment of effectiveness (and measurement of any ineffectiveness) is based on total changes in the related derivative's cash flows. As a result, the amount reclassified into earnings each period includes an amount that offsets the related transaction gain or loss arising from that re-measurement and the adjustment to earnings for the period's allocable portion of the initial spot-forward difference associated with the hedging instrument. These derivatives will mature on dates ranging from April 2022 to March 2034.
Financial Statement Presentation
Realized derivative gains and losses are recorded in interest, net, in the Company's Consolidated Statements of Income. Although subject to master netting arrangements, the Company does not offset derivative assets and liabilities in its Consolidated Balance Sheets. Derivatives with an unrealized gain are recorded in the Company's Consolidated Balance Sheets as either current or non-current assets, based on maturity date, and derivatives with an unrealized loss are recorded as either current or non-current liabilities, based on maturity date. Refer to Note 7 for the net presentation of the Company's derivatives. Additionally, the Company records cash collateral received as amounts due to the counterparties exclusive of any derivative asset and records cash collateral it posts with counterparties as amounts receivable from those counterparties exclusive of any derivative liability.
Income Taxes
Income taxes are accounted for under the balance sheet method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases ("temporary differences"). Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rate is recognized in income in the period that includes the enactment date.
Deferred tax assets are evaluated for future realization and reduced by a valuation allowance to the extent that a portion is not more likely than not to be realized. Many factors are considered when assessing whether it is more likely than not that the deferred tax assets will be realized, including recent cumulative earnings, expectations of future taxable income, carryforward periods, and other relevant quantitative and qualitative factors. The recoverability of the deferred tax assets is evaluated by assessing the adequacy of future expected taxable income from all sources, including reversal of taxable temporary differences, forecasted operating earnings and available tax planning strategies. These sources of income rely heavily on estimates.
The Tax Cuts and Jobs Act contains a provision which subjects a US parent of a foreign subsidiary to current US tax on its global intangible low–taxed income (“GILTI”). The GILTI income is eligible for a deduction, which lowers the effective tax rate to 10.5% for calendar years 2018 through 2025 and 13.125% after 2025. The Company will report the tax impact of GILTI as a period cost when incurred. Accordingly, the Company is not providing deferred taxes for basis differences expected to reverse as GILTI.
In determining the provision for income taxes, an annual effective income tax rate is used based on annual income, permanent differences between book and tax income, and statutory income tax rates. Discrete events such as audit settlements or changes in tax laws are recognized in the period in which they occur.
The Company records a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. The Company records interest and penalties related to unrecognized tax benefits in interest expense and operating, selling, general and administrative expenses, respectively, in the Company's Consolidated Statements of Income. Refer to Note 9 for additional income tax disclosures.
In February 2018, the FASB issued ASU 2018-02, Income Statement–Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income ("ASU 2018-02"). This ASU provides that the stranded tax effects from the Tax Cuts and Jobs Act of 2017 ("Tax Act") in accumulated other comprehensive loss may be reclassified to retained earnings. The Company adopted this ASU on February 1, 2018, which resulted in an immaterial negative adjustment to retained earnings.
Revenue Recognition    
In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606).  This ASU is a comprehensive new revenue recognition model that requires a company to recognize revenue to depict the transfer of goods or services to a customer at an amount that reflects the consideration it expects to receive in exchange for those goods or services. The Company adopted this ASU on February 1, 2018, using the modified retrospective approach and applied this ASU only to contracts not completed as of February 1, 2018. The accounting policies and other disclosures are below as well as the disclosure of disaggregated revenues in  Note 15. The impact of adopting this ASU was not material to the Consolidated Financial Statements.
Net Sales
The Company recognizes sales revenue, net of sales taxes and estimated sales returns, at the time it sells merchandise to the customer. eCommerce sales include shipping revenue and are recorded upon delivery to the customer. Additionally, estimated sales returns are calculated based on expected returns.
Membership Fee Revenue
The Company recognizes membership fee revenue both in the U.S. and internationally over the term of the membership, which is typically 12 months. Membership fee revenue was $1.4 billion for each of fiscal 2019, 2018 and 2017, respectively. Membership fee revenue is included in membership and other income in the Company's Consolidated Statements of Income. Deferred membership fee is included in accrued liabilities in the Company's Consolidated Balance Sheets.
Gift Cards
Customer purchases of gift cards are not recognized as sales until the card is redeemed and the customer purchases merchandise using the gift card. Gift cards in the U.S. and some countries do not carry an expiration date; therefore, customers and members can redeem their gift cards for merchandise and services indefinitely. Gift cards in some countries where the Company does business have expiration dates. While gift cards are generally redeemed within 12 months, a certain number of gift cards, both with and without expiration dates, will not be fully redeemed. Management estimates unredeemed balances and recognizes revenue for these amounts in membership and other income in the Company's Consolidated Statements of Income over the expected redemption period. Management periodically reviews and updates its estimates.
Financial and Other Services
The Company recognizes revenue from service transactions at the time the service is performed. Generally, revenue from services is classified as a component of net sales in the Company's Condensed Consolidated Statements of Income.
Contract Balances
Contract balances as a result of transactions with customers primarily consist of receivables included in receivables, net, and deferred gift card revenue included in accrued liabilities in the Company's Condensed Consolidated Balance Sheets. The following table provides the Company's receivables and deferred gift card revenue from transactions with customers:
(Amounts in millions)
 
As of January 31, 2019
Assets:
 
 
Receivables from transactions with customers, net
 
$
2,538

 
 
 
Liabilities:
 
 
Deferred gift card revenue
 
$
1,932



Cost of Sales
Cost of sales includes actual product cost, the cost of transportation to the Company's distribution facilities, stores and clubs from suppliers, the cost of transportation from the Company's distribution facilities to the stores, clubs and customers and the cost of warehousing for the Sam's Club segment and import distribution centers. Cost of sales is reduced by supplier payments that are not a reimbursement of specific, incremental and identifiable costs.
Payments from Suppliers
The Company receives consideration from suppliers for various programs, primarily volume incentives, warehouse allowances and reimbursements for specific programs such as markdowns, margin protection, advertising and supplier-specific fixtures. Payments from suppliers are accounted for as a reduction of cost of sales, except in certain limited situations when the payment is a reimbursement of specific, incremental and identifiable costs, and are recognized in the Company's Consolidated Statements of Income when the related inventory is sold.
Operating, Selling, General and Administrative Expenses
Operating, selling, general and administrative expenses include all operating costs of the Company, except cost of sales, as described above. As a result, the majority of the cost of warehousing and occupancy for the Walmart U.S. and Walmart International segments' distribution facilities is included in operating, selling, general and administrative expenses. Because the Company only includes a portion of the cost of its Walmart U.S. and Walmart International segments' distribution facilities in cost of sales, its gross profit and gross profit as a percentage of net sales may not be comparable to those of other retailers that may include all costs related to their distribution facilities in cost of sales and in the calculation of gross profit.
Advertising Costs
Advertising costs are expensed as incurred, consist primarily of print, television and digital advertisements and are recorded in operating, selling, general and administrative expenses in the Company's Consolidated Statements of Income. In certain limited situations, reimbursements from suppliers that are for specific, incremental and identifiable advertising costs are recognized as a reduction of advertising costs in operating, selling, general and administrative expenses. Advertising costs were $3.5 billion, $3.1 billion and $2.9 billion for fiscal 2019, 2018 and 2017, respectively.
Currency Translation
The assets and liabilities of all international subsidiaries are translated from the respective local currency to the U.S. dollar using exchange rates at the balance sheet date. Related translation adjustments are recorded as a component of accumulated other comprehensive loss. The Company's Consolidated Statements of Income of all international subsidiaries are translated from the respective local currencies to the U.S. dollar using average exchange rates for the period covered by the income statements.
Recent Accounting Pronouncements
Leases
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which requires lease assets and liabilities to be recorded on the balance sheet.  Certain qualitative and quantitative disclosures are also required.  The Company will adopt this ASU and related amendments as of the beginning of the first quarter of the year ending January 31, 2020 ("fiscal 2020") and will be electing certain practical expedients permitted under the transition guidance, including to retain the historical lease classification as well as relief from reviewing expired or existing contracts to determine if they contain leases.  The Company will be exempting leases with an initial term of twelve months or less from balance sheet recognition and, for most classes of assets, the Company will be combining non-lease components with lease components. Management has implemented and continues to implement new lease systems in connection with the adoption.
The adoption of this ASU and related amendments will result in total assets and liabilities increasing approximately $15 billion, which is primarily due to recognizing approximately $17.5 billion of operating lease assets and liabilities, partially offset by derecognizing approximately $3 billion of assets and liabilities related to financial obligations connected with the construction of leased stores. Several other line items in the Company’s Consolidated Balance Sheet will also be impacted by immaterial amounts. The Company’s Consolidated Statements of Income and Consolidated Statements of Cash Flows will not be materially impacted. Finally, management expects the first quarter fiscal 2020 disclosure of future operating commitments to significantly increase compared to the aggregate minimum rentals disclosed in Note 11, primarily because the new standard requires reasonably assured renewals be included.
Financial Instruments
In June 2016, the FASB issued ASU 2016-13, Financial Instruments–Credit Losses (Topic 326), which modifies the measurement of expected credit losses of certain financial instruments. The Company will adopt this ASU on February 1, 2020. Management is currently evaluating this ASU to determine its impact to the Company's consolidated financial statements.
v3.19.1
Net Income Per Common Share
12 Months Ended
Jan. 31, 2019
Earnings Per Share [Abstract]  
Net income per common share
Net Income Per Common Share
Basic net income per common share attributable to Walmart is based on the weighted-average common shares outstanding during the relevant period. Diluted net income per common share attributable to Walmart is based on the weighted-average common shares outstanding during the relevant period adjusted for the dilutive effect of share-based awards. The Company did not have significant share-based awards outstanding that were antidilutive and not included in the calculation of diluted net income per common share attributable to Walmart for fiscal 2019, 2018 and 2017.
The following table provides a reconciliation of the numerators and denominators used to determine basic and diluted net income per common share attributable to Walmart:
 
 
Fiscal Years Ended January 31,
(Amounts in millions, except per share data)
 
2019
 
2018
 
2017
Numerator
 
 
 
 
 
 
Consolidated net income
 
$
7,179

 
$
10,523

 
$
14,293

Consolidated net income attributable to noncontrolling interest
 
(509
)
 
(661
)
 
(650
)
Consolidated net income attributable to Walmart
 
$
6,670

 
$
9,862

 
$
13,643

 
 
 
 
 
 
 
Denominator
 
 
 
 
 
 
Weighted-average common shares outstanding, basic
 
2,929

 
2,995

 
3,101

Dilutive impact of stock options and other share-based awards
 
16

 
15

 
11

Weighted-average common shares outstanding, diluted
 
2,945

 
3,010

 
3,112


 
 
 
 
 
 
Net income per common share attributable to Walmart
 
 
 
 
 
 
Basic
 
$
2.28

 
$
3.29

 
$
4.40

Diluted
 
2.26

 
3.28

 
4.38

v3.19.1
Shareholders' Equity
12 Months Ended
Jan. 31, 2019
Share-based Compensation [Abstract]  
Stockholders' Equity Note Disclosure [Text Block]
Shareholders' Equity
The total authorized shares of $0.10 par value common stock is 11.0 billion, of which 2.9 billion and 3.0 billion were issued and outstanding as of January 31, 2019 and 2018, respectively.
Share-Based Compensation
The Company has awarded share-based compensation to associates and nonemployee directors of the Company. The compensation expense recognized for all stock incentive plans, including expense associated with plans of the Company's consolidated subsidiaries granted in the subsidiaries' respective stock, was $773 million, $626 million and $596 million for fiscal 2019, 2018 and 2017, respectively. Share-based compensation expense is generally included in operating, selling, general and administrative expenses in the Company's Consolidated Statements of Income. The total income tax benefit recognized for share-based compensation was $181 million, $150 million and $212 million for fiscal 2019, 2018 and 2017, respectively. The following table summarizes the Company's share-based compensation expense by award type for all plans:
 
Fiscal Years Ended January 31,
(Amounts in millions)
2019
 
2018
 
2017
Restricted stock and performance share units
$
293

 
$
234

 
$
237

Restricted stock units
456

 
368

 
332

Other
24

 
24

 
27

Share-based compensation expense
$
773

 
$
626

 
$
596


The Walmart Inc. Stock Incentive Plan of 2015 (the "Plan"), as amended and restated effective February 23, 2016, as amended further as of February 1, 2017, and as renamed on February 1, 2018, was established to grant stock options, restricted (non-vested) stock, performance share units and other equity compensation awards for which 260 million shares of Walmart common stock issued or to be issued under the Plan have been registered under the Securities Act of 1933, as amended. The Company believes that such awards serve to align the interests of its associates with those of its shareholders.
The Plan's award types are summarized as follows:
Restricted Stock and Performance Share Units. Restricted stock awards are for shares that vest based on the passage of time and include restrictions related to employment. Performance share units vest based on the passage of time and achievement of performance criteria and may range from 0% to 150% of the original award amount. Vesting periods for these awards are generally between one and three years. Restricted stock and performance share units may be settled or deferred in stock and are accounted for as equity in the Company's Consolidated Balance Sheets. The fair value of restricted stock awards is determined on the date of grant and is expensed ratably over the vesting period. The fair value of performance share units is determined on the date of grant using the Company's stock price discounted for the expected dividend yield through the vesting period and is recognized over the vesting period. The weighted-average discount for the dividend yield used to determine the fair value of performance share units in fiscal 2019, 2018 and 2017 was 6.2%, 7.2% and 8.3%, respectively.
Restricted Stock Units. Restricted stock units provide rights to Company stock after a specified service period; generally 50% vest three years from the grant date and the remaining 50% vest five years from the grant date. The fair value of each restricted stock unit is determined on the date of grant using the stock price discounted for the expected dividend yield through the vesting period and is recognized ratably over the vesting period. The expected dividend yield is based on the anticipated dividends over the vesting period. The weighted-average discount for the dividend yield used to determine the fair value of restricted stock units granted in fiscal 2019, 2018 and 2017 was 7.2%, 9.0% and 9.0%, respectively.
In addition to the Plan, the Company's United Kingdom subsidiary has stock option plans for certain colleagues which generally vest over three years. The stock option share-based compensation expense is included in the Other line in the table above.
Flipkart also maintains a stock option plan primarily for the benefit of employees and nonemployee directors under which options to acquire Flipkart common shares may be issued. The grants have no exercise price and no compensation expense was recognized during fiscal 2019 due to a liquidity event performance condition that was not deemed probable of occurrence.
The following table shows the activity for restricted stock and performance share units and restricted stock units during fiscal 2019:
 
 
Restricted Stock and Performance Share Units(1)
 
Restricted Stock Units
(Shares in thousands)
 
Shares
 
Weighted-Average Grant-Date Fair Value Per Share
 
Shares
 
Weighted-Average Grant-Date Fair Value Per Share
Outstanding as of February 1, 2018
 
8,558

 
$
70.47

 
24,153

 
$
66.69

Granted
 
3,600

 
84.94

 
7,946

 
80.94

Vested/exercised
 
(2,448
)
 
74.67

 
(5,524
)
 
69.52

Forfeited
 
(911
)
 
68.24

 
(2,620
)
 
69.74

Outstanding as of January 31, 2019
 
8,799

 
$
75.39

 
23,955

 
$
70.47

(1)
Assumes payout rate at 100% for Performance Share Units.
The following table includes additional information related to restricted stock and performance share units and restricted stock units: 
 
Fiscal Years Ended January 31,
(Amounts in millions, except years)
2019
 
2018
 
2017
Fair value of restricted stock and performance share units vested
$
183

 
$
181

 
$
149

Fair value of restricted stock units vested
386

 
344

 
261

Unrecognized compensation cost for restricted stock and performance share units
362

 
291

 
211

Unrecognized compensation cost for restricted stock units
1,002

 
972

 
986

Weighted average remaining period to expense for restricted stock and performance share units (years)
1.1

 
1.2

 
1.3

Weighted average remaining period to expense for restricted stock units (years)
1.6

 
1.8

 
1.9


Share Repurchase Program
From time to time, the Company repurchases shares of its common stock under share repurchase programs authorized by the Company's Board of Directors. All repurchases made during fiscal year 2019 were made under the current $20.0 billion share repurchase program approved in October 2017, which has no expiration date or other restrictions limiting the period over which the Company can make share repurchases. As of January 31, 2019, authorization for $11.3 billion of share repurchases remained under the share repurchase program. Any repurchased shares are constructively retired and returned to an unissued status.
The Company regularly reviews share repurchase activity and considers several factors in determining when to execute share repurchases, including, among other things, current cash needs, capacity for leverage, cost of borrowings, results of operations and the market price of the Company's common stock. The following table provides, on a settlement date basis, the number of shares repurchased, average price paid per share and total amount paid for share repurchases for fiscal 2019, 2018 and 2017:
 
 
Fiscal Years Ended January 31,
(Amounts in millions, except per share data)
 
2019
 
2018
 
2017
Total number of shares repurchased
 
79.5

 
104.9

 
119.9

Average price paid per share
 
$
93.18

 
$
79.11

 
$
69.18

Total cash paid for share repurchases
 
$
7,410

 
$
8,296

 
$
8,298

v3.19.1
Accumulated Other Comprehensive Loss
12 Months Ended
Jan. 31, 2019
Other Comprehensive Income (Loss), Tax [Abstract]  
Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Loss
The following table provides the changes in the composition of total accumulated other comprehensive loss for fiscal 2019, 2018 and 2017:
(Amounts in millions and net of income taxes)
Currency
Translation
and Other
 
Net Investment Hedges
 
Unrealized Gain on Available-for-Sale Securities
 
Cash Flow Hedges
 
Minimum
Pension Liability
 
Total
Balances as of February 1, 2016
$
(11,690
)
 
$
1,022

 
$

 
$
(336
)
 
$
(593
)
 
$
(11,597
)
Other comprehensive income (loss) before reclassifications, net
(2,817
)
 
413

 
145

 
(22
)
 
(389
)
 
(2,670
)
Amounts reclassified from accumulated other comprehensive loss, net

 

 

 
43

 
(8
)
 
35

Balances as of January 31, 2017
(14,507
)
 
1,435

 
145

 
(315
)
 
(990
)
 
(14,232
)
Other comprehensive income (loss) before reclassifications, net
2,345

 
(405
)
 
1,501

 
436

 
83

 
3,960

Amounts reclassified from accumulated other comprehensive loss, net
26

 

 

 
1

 
64

 
91

Balances as of January 31, 2018
(12,136
)
 
1,030

 
1,646

 
122

 
(843
)
 
(10,181
)
Adoption of new accounting standards on February 1, 2018(1)
89

 
93

 
(1,646
)
 
28

 

 
(1,436
)
Other comprehensive income (loss) before reclassifications, net
(2,093
)
 
272

 

 
(339
)
 
93

 
(2,067
)
Reclassifications to income, net(2)
2,055

 

 

 
49

 
38

 
2,142

Balances as of January 31, 2019
$
(12,085
)
 
$
1,395

 
$

 
$
(140
)
 
$
(712
)
 
$
(11,542
)
(1) Primarily relates to the adoption of ASU 2016-01 and ASU 2018-02.
(2) Includes a cumulative foreign currency translation loss of $2.0 billion, for which there was no related income taxes, upon sale of the majority stake in Walmart Brazil (see Note 13).
The income tax impact for each of the amounts shown in the table above is immaterial. Amounts reclassified from accumulated other comprehensive loss for derivatives are recorded in interest, net, in the Company's Consolidated Statements of Income, and the amounts for the minimum pension liability, as well as the cumulative translation resulting from the disposition of a business, are recorded in other gains and losses in the Company's Consolidated Statements of Income.
v3.19.1
Accrued Liabilities
12 Months Ended
Jan. 31, 2019
Accrued Liabilities [Abstract]  
Accounts payable and accrued liabilities disclosure
Accrued Liabilities
The Company's accrued liabilities consist of the following as of January 31, 2019 and 2018:
 
 
January 31,
(Amounts in millions)
 
2019
 
2018
Accrued wages and benefits(1)
 
$
6,504

 
$
6,998

Self-insurance(2)
 
3,979

 
3,737

Accrued non-income taxes(3)
 
2,979

 
3,073

Deferred gift card revenue
 
1,932

 
2,017

Other(4)
 
6,765

 
6,297

Total accrued liabilities
 
$
22,159

 
$
22,122

(1)
Accrued wages and benefits include accrued wages, salaries, vacation, bonuses and other incentive plans.
(2)
Self-insurance consists of insurance-related liabilities, such as workers' compensation, general liability, auto liability, product liability and certain employee-related healthcare benefits.
(3)
Accrued non-income taxes include accrued payroll, value added, sales and miscellaneous other taxes.
(4)
Other accrued liabilities consist of various items such as maintenance, utilities, advertising, interest and legal contingencies.
v3.19.1
Short-term Borrowings and Long-term Debt
12 Months Ended
Jan. 31, 2019
Long-term Debt, Unclassified [Abstract]  
Short-term Borrowings and Long-term debt
Short-term Borrowings and Long-term Debt
Short-term borrowings consist of commercial paper and lines of credit. Short-term borrowings as of January 31, 2019 and 2018 were $5.2 billion and $5.3 billion, respectively, with weighted-average interest rates of 2.7% and 1.5%, respectively.
The Company has various committed lines of credit in the U.S., committed with 22 financial institutions, totaling $15.0 billion and $12.5 billion as of January 31, 2019 and 2018, respectively. These committed lines of credit are summarized in the following table:
 
 
January 31, 2019
 
January 31, 2018
(Amounts in millions)
 
Available
 
Drawn
 
Undrawn
 
Available
 
Drawn
 
Undrawn
Five-year credit facility(1)
 
$
5,000

 
$

 
$
5,000

 
$
5,000

 
$

 
$
5,000

364-day revolving credit facility(1)
 
10,000

 

 
10,000

 
7,500

 

 
7,500

Total
 
$
15,000

 
$

 
$
15,000

 
$
12,500

 
$

 
$
12,500


(1)
In May 2018, the Company renewed and extended its existing five-year credit facility and its existing 364-day revolving credit facility, both of which are used to support its commercial paper program.
The committed lines of credit in the table above mature at various times between May 2019 and May 2023, carry interest rates generally ranging between LIBOR plus 10 basis points and LIBOR plus 75 basis points, and incur commitment fees ranging between 1.5 and 4.0 basis points. In conjunction with the committed lines of credit listed in the table above, the Company has agreed to observe certain covenants, the most restrictive of which relates to the maximum amount of secured debt. Additionally, the Company also maintains other committed lines of credit outside of the U.S., with available amounts of approximately $3.0 billion and $4.0 billion as of January 31, 2019 and 2018, respectively, of which approximately $0.2 billion and no amount was drawn as of January 31, 2019 and 2018, respectively.
Apart from the committed lines of credit, the Company has syndicated and fronted letters of credit available totaling $1.8 billion as of January 31, 2019 and 2018, of which $1.6 billion and $1.5 billion was drawn as of January 31, 2019 and 2018, respectively. The Company also has trade letters of credit, without stated limits, of which $0.4 billion was drawn as of January 31, 2019 and 2018.
The Company's long-term debt, which includes the fair value instruments further discussed in Note 8, consists of the following as of January 31, 2019 and 2018:
 
 
 
 
January 31, 2019
 
January 31, 2018
(Amounts in millions)
 
Maturity Dates
By Fiscal Year
 
Amount
 
Average Rate(1)
 
Amount
 
Average Rate(1)
Unsecured debt
 
 
 
 
 
 
 
 
 
 
Fixed
 
2020 - 2049
 
$
35,816

 
3.9%
 
$
24,540

 
3.9%
Variable
 
2020 - 2022
 
1,800

 
2.9%
 
800

 
4.1%
Total U.S. dollar denominated
 
 
 
37,616

 
 
 
25,340

 
 
Fixed
 
2023 - 2030
 
2,870

 
3.3%
 
3,101

 
3.3%
Variable
 
 
 

 
 
 

 
 
Total Euro denominated
 
 
 
2,870

 
 
 
3,101

 
 
Fixed
 
2031 - 2039
 
3,524

 
5.4%
 
3,801

 
5.4%
Variable
 
 
 

 
 
 

 
 
Total Sterling denominated
 
 
 
3,524

 
 
 
3,801

 
 
Fixed
 
2021 - 2028
 
1,651

 
0.4%
 
1,655

 
0.4%
Variable
 
 
 

 
 
 

 
 
Total Yen denominated
 
 
 
1,651

 
 
 
1,655

 
 
Total unsecured debt
 
 
 
45,661

 
 
 
33,897

 
 
Total other(2)
 
 
 
(265
)
 
 
 
(114
)
 
 
Total debt
 
 
 
45,396

 
 
 
33,783

 
 
Less amounts due within one year
 
 
 
(1,876
)
 
 
 
(3,738
)
 
 
Long-term debt
 
 
 
$
43,520

 
 
 
$
30,045

 
 
(1)
The average rate represents the weighted-average stated rate for each corresponding debt category, based on year-end balances and year-end interest rates. Interest costs are also impacted by certain derivatives described in Note 8.
(2)
Includes deferred loan costs, discounts, fair value hedges, foreign-held debt and secured debt. As of January 31, 2019 and 2018 the Company had secured debt in the amount of $8 million and $10 million, respectively, which was collateralized by property that had an aggregate carrying amount of $82 million and $101 million, respectively.
As of January 31, 2018, the Company had $500 million in debt with embedded put options. These bonds matured in June 2018, and were fully repaid. The issuance of money market puttable reset securities in the amount of $500 million is structured to be remarketed in connection with the annual reset of the interest rate. If, for any reason, the remarketing of the notes does not occur at the time of any interest rate reset, the holders of the notes must sell and the Company must repurchase the notes at par. Accordingly as of January 31, 2018, this issuance was classified as long-term debt due within one year in the Company's Consolidated Balance Sheets.
Annual maturities of long-term debt during the next five years and thereafter are as follows:
(Amounts in millions)
Annual
Fiscal Year
Maturities
2020
$
1,876

2021
5,347

2022
3,080

2023
2,844

2024
4,595

Thereafter
27,654

Total
$
45,396


Debt Issuances
Information on long-term debt issued during fiscal 2019 to fund a portion of the purchase price for the Flipkart acquisition discussed in Note 13 and for general corporate purposes, is as follows:
(Amounts in millions)
 
 
 
 
 
 
 
 
 
 
Issue Date
 
Principal Amount
 
Maturity Date
 
Fixed vs. Floating
 
Interest Rate
 
Net Proceeds
June 27, 2018
 
750 USD
 
June 23, 2020
 
Floating
 
Floating
 
$
748

June 27, 2018
 
1,250 USD
 
June 23, 2020
 
Fixed
 
2.850%
 
1,247

June 27, 2018
 
750 USD
 
June 23, 2021
 
Floating
 
Floating
 
748

June 27, 2018
 
1,750 USD
 
June 23, 2021
 
Fixed
 
3.125%
 
1,745

June 27, 2018
 
2,750 USD
 
June 26, 2023
 
Fixed
 
3.400%
 
2,740

June 27, 2018
 
1,500 USD
 
June 26, 2025
 
Fixed
 
3.550%
 
1,490

June 27, 2018
 
2,750 USD
 
June 26, 2028
 
Fixed
 
3.700%
 
2,725

June 27, 2018
 
1,500 USD
 
June 28, 2038
 
Fixed
 
3.950%
 
1,473

June 27, 2018
 
3,000 USD
 
June 29, 2048
 
Fixed
 
4.050%
 
2,935

Various
 
21 USD
 
Various
 
Various
 
Various
 
21

Total
 
 
 
 
 
 
 
 
 
$
15,872



The June 2018 issuances are senior, unsecured notes which rank equally with all other senior, unsecured debt obligations of the Company, and are not convertible or exchangeable. These issuances do not contain any financial covenants and do not restrict the Company's ability to pay dividends or repurchase company stock.
During fiscal 2018, significant long-term debt issuances were as follows:
(Amounts in millions)
 
 
 
 
 
 
 
 
 
 
Issue Date
 
Principal Amount
 
Maturity Date
 
Fixed vs. Floating
 
Interest Rate
 
Net Proceeds
July 18, 2017
 
70,000 JPY
 
July 15, 2022
 
Fixed
 
0.183%
 
$
619

July 18, 2017
 
40,000 JPY
 
July 18, 2024
 
Fixed
 
0.298%
 
354

July 18, 2017
 
60,000 JPY
 
July 16, 2027
 
Fixed
 
0.520%
 
530

October 20, 2017
 
300 USD
 
October 9, 2019
 
Floating
 
Floating
 
299

October 20, 2017
 
1,200 USD
 
October 9, 2019
 
Fixed
 
1.750%
 
1,198

October 20, 2017
 
1,250 USD
 
December 15, 2020
 
Fixed
 
1.900%
 
1,245

October 20, 2017
 
1,250 USD
 
December 15, 2022
 
Fixed
 
2.350%
 
1,245

October 20, 2017
 
1,000 USD
 
December 15, 2024
 
Fixed
 
2.650%
 
996

October 20, 2017
 
1,000 USD
 
December 15, 2047
 
Fixed
 
3.625%
 
990

Total
 
 
 
 
 
 
 
 
 
$
7,476


As described in Note 8, the prior year issuances of foreign-currency-denominated long-term debt are designated as a hedge of the Company's net investment in Japan.

Repayments and Extinguishments
The following table provides details of debt repayments during fiscal 2019:
(Amounts in millions)
 
 
 
 
 
 
 
 
Maturity Date
 
Principal Amount
 
Fixed vs. Floating
 
Interest Rate
 
Repayment
February 15, 2018
 
1,250 USD
 
Fixed
 
5.800%
 
$
1,250

April 11, 2018
 
1,250 USD
 
Fixed
 
1.125%
 
1,250

June 1, 2018
 
500 USD
 
Floating
 
Floating
 
500

December 15, 2018
 
724 USD
 
Fixed
 
1.950%
 
724

Various(1)
 
60 USD
 
Various
 
Various
 
60

Total
 
 
 
 
 
 
 
$
3,784

(1) Includes repayments of smaller long-term debt as it matured in several non-U.S. operations.

During fiscal 2018, the following long-term debt matured and was repaid:
(Amounts in millions)
 
 
 
 
 
 
 
 
Maturity Date
 
Principal Amount
 
Fixed vs. Floating
 
Interest Rate
 
Repayment (2)
April 5, 2017
 
1,000 USD
 
Fixed
 
5.375%
 
$
1,000

April 21, 2017
 
500 USD
 
Fixed
 
1.000%
 
500

Various(1)
 
289 USD
 
Various
 
Various
 
289

Total repayment of matured debt
 
 
 
 
 
 
 
1,789

 
 
 
 
 
 
 
 
 
December 15, 2018
 
1,000 USD
 
Fixed
 
1.950%
 
$
276

February 1, 2019
 
500 USD
 
Fixed
 
4.125%
 
136

July 8, 2020
 
1,500 USD
 
Fixed
 
3.625%
 
661

October 25, 2020
 
1,750 USD
 
Fixed
 
3.250%
 
553

April 15, 2021
 
1,000 USD
 
Fixed
 
4.250%
 
491

October 16, 2023
 
250 USD
 
Fixed
 
6.750%
 
98

April 5, 2027
 
750 USD
 
Fixed
 
5.875%
 
267

February 15, 2030
 
500 USD
 
Fixed
 
7.550%
 
412

September 4, 2035
 
2,500 USD
 
Fixed
 
5.250%
 
532

September 28, 2035
 
1,000 GBP
 
Fixed
 
5.250%
 
260

August 17, 2037
 
3,000 USD
 
Fixed
 
6.500%
 
1,700

April 15, 2038
 
2,000 USD
 
Fixed
 
6.200%
 
1,081

January 19, 2039
 
1,000 GBP
 
Fixed
 
4.875%
 
851

April 2, 2040
 
1,250 USD
 
Fixed
 
5.625%
 
499

July 9, 2040
 
750 USD
 
Fixed
 
4.875%
 
372

October 25, 2040
 
1,250 USD
 
Fixed
 
5.000%
 
731

April 15, 2041
 
2,000 USD
 
Fixed
 
5.625%
 
1,082

April 11, 2043
 
1,000 USD
 
Fixed
 
4.000%
 
291

October 2, 2043
 
750 USD
 
Fixed
 
4.750%
 
481

April 22, 2044
 
1,000 USD
 
Fixed
 
4.300%
 
498

Total repayment of extinguished debt
 
 
 
 
 
 
 
11,272

Total
 
 
 
 
 
 
 
$
13,061


(1) Includes repayments of smaller long-term debt as it matured in several non-U.S. operations.
(2) Represents portion of the principal amount repaid during fiscal 2018.
In fiscal 2018, in connection with extinguishing debt, the Company paid premiums of approximately $3.1 billion which resulted in a loss on extinguishment of debt of approximately $3.1 billion.
v3.19.1
Fair Value Measurements
12 Months Ended
Jan. 31, 2019
Fair Value Disclosures [Abstract]  
Fair value measurements
Fair Value Measurements
Assets and liabilities recorded at fair value are measured using the fair value hierarchy, which prioritizes the inputs used in measuring fair value. The levels of the fair value hierarchy are:
Level 1: observable inputs such as quoted prices in active markets;
Level 2: inputs other than quoted prices in active markets that are either directly or indirectly observable; and
Level 3: unobservable inputs for which little or no market data exists, therefore requiring the Company to develop its own assumptions.
The Company measures the fair value of equity investments (primarily its investment in JD) on a recurring basis and records them in other long-term assets in the accompanying Consolidated Balance Sheets. Measurement details about the Company's two portions of the investment in JD are as follows:
The purchased portion of the investment in JD measured using Level 1 inputs, which prior to fiscal 2019 was classified as available-for-sale with changes in fair value recognized through other comprehensive income; and
The portion of the investment in JD received in exchange for selling certain assets related to Yihaodian, the Company's former eCommerce operation in China, measured using Level 2 inputs. Fair value is determined primarily using quoted prices in active markets for similar assets. Prior to fiscal 2019, the investment was carried at cost.
Information for the cost basis, carrying value and fair value of the Company's investment in JD is as follows:
(Amounts in millions)
 
Cost Basis
 
Carrying Value as of January 31, 2018
 
Fair Value as of February 1, 2018
 
 
Fair Value as of January 31, 2019
 
Investment in JD measured using Level 1 inputs
 
$
1,901

 
$