Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
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Condensed Consolidated Balance Sheets [Abstract] | |||
Preferred stock, par value (in dollars per share) | $ 1.00 | $ 1.00 | $ 1.00 |
Preferred stock, authorized shares | 400,000 | 400,000 | 400,000 |
Preferred stock, issued shares | 0 | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.10 | $ 0.10 | $ 0.10 |
Common stock, authorized shares | 1,000,000,000.0 | 1,000,000,000.0 | 1,000,000,000.0 |
Common stock, issued shares | 265,000,000 | 266,000,000 | 276,000,000 |
Common stock, outstanding shares | 265,000,000 | 266,000,000 | 276,000,000 |
Condensed Consolidated Statements of Earnings - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||
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Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
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Condensed Consolidated Statements of Earnings [Abstract] | ||||
Revenue | $ 9,536 | $ 9,379 | $ 18,678 | $ 18,488 |
Cost of goods sold | 7,253 | 7,150 | 14,226 | 14,134 |
Gross profit | 2,283 | 2,229 | 4,452 | 4,354 |
Selling, general and administrative expenses | 1,922 | 1,877 | 3,757 | 3,707 |
Restructuring charges | 48 | 17 | 48 | 47 |
Operating income | 313 | 335 | 647 | 600 |
Other income (expense): | ||||
Investment income and other | 10 | 13 | 24 | 24 |
Interest expense | (16) | (19) | (34) | (38) |
Earnings before income tax expense | 307 | 329 | 637 | 586 |
Income tax expense | 69 | 85 | 134 | 134 |
Net earnings | $ 238 | $ 244 | $ 503 | $ 452 |
Basic earnings per share | $ 0.89 | $ 0.88 | $ 1.88 | $ 1.61 |
Diluted earnings per share | $ 0.89 | $ 0.86 | $ 1.86 | $ 1.58 |
Weighted-average common shares outstanding | ||||
Basic | 267.1 | 279.0 | 267.4 | 280.8 |
Diluted | 269.4 | 283.7 | 270.9 | 286.0 |
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
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Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
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Condensed Consolidated Statements of Comprehensive Income [Abstract] | ||||
Net earnings | $ 238 | $ 244 | $ 503 | $ 452 |
Foreign currency translation adjustments | 5 | (14) | (18) | |
Comprehensive income | $ 243 | $ 230 | $ 503 | $ 434 |
Condensed Consolidated Statements of Changes in Shareholders' Equity (Parenthetical) - $ / shares |
3 Months Ended | 6 Months Ended | ||
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Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
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Condensed Consolidated Statements of Changes in Shareholders' Equity [Abstract] | ||||
Dividends declared per common share | $ 0.50 | $ 0.45 | $ 1.00 | $ 0.90 |
Basis of Presentation |
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Basis of Presentation | 1. Basis of Presentation
Unless the context otherwise requires, the use of the terms “Best Buy,” “we,” “us” and “our” in these Notes to Condensed Consolidated Financial Statements refers to Best Buy Co., Inc. and, as applicable, its consolidated subsidiaries.
In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments necessary for a fair presentation as prescribed by accounting principles generally accepted in the United States (“GAAP”). All adjustments were comprised of normal recurring adjustments, except as noted in these Notes to Condensed Consolidated Financial Statements.
Historically, we have generated a large proportion of our revenue and earnings in the fiscal fourth quarter, which includes the majority of the holiday shopping season in the U.S., Canada and Mexico. Due to the seasonal nature of our business, interim results are not necessarily indicative of results for the entire fiscal year. The interim financial statements and the related notes included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019. The first six months of fiscal 2020 and fiscal 2019 included 26 weeks.
In order to align our fiscal reporting periods and comply with statutory filing requirements, we consolidate the financial results of our Mexico operations on a one-month lag. Our policy is to accelerate recording the effect of events occurring in the lag period that significantly affect our condensed consolidated financial statements. No such events were identified for the reported periods.
In preparing the accompanying condensed consolidated financial statements, we evaluated the period from August 3, 2019, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. Other than as disclosed in Note 15, Subsequent Event, no such events were identified for the reported periods.
Unadopted Accounting Pronouncements
In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of the current goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on the current Step 1). We do not believe the new guidance, which is effective for fiscal years beginning after December 15, 2019, will have a material impact on our consolidated financial statements.
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance improves the disclosure requirements for fair value measurements. We do not believe the updated guidance, which is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2019, will have a material impact on our consolidated financial statements.
In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other - Internal Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. This guidance requires companies to apply the internal-use software guidance in Accounting Standards Codification (“ASC”) 350-40 to implementation costs incurred in a hosting arrangement that is a service contract to determine whether to capitalize certain implementation costs or expense them as incurred. We do not believe the new guidance, which is effective for fiscal years beginning after December 15, 2019, will have a material impact on our consolidated financial statements.
Adopted Accounting Pronouncements
In February 2016, the FASB issued ASU 2016-02, Leases, which requires the recognition of operating lease assets and lease liabilities on the balance sheet. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Under the new standard, disclosures are required to enable users of financial statements to assess the amount, timing and uncertainty of cash flows arising from leases.
In the first quarter of fiscal 2020, we adopted ASU 2016-02 using the “Comparatives Under 840 Option” approach to transition. Under this method, financial information related to periods prior to adoption will be as originally reported under the previous standard – ASC 840, Leases. The effects of adopting the new standard (ASC 842, Leases) in fiscal 2020 were recognized as a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal first quarter. We elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allows us to carry forward the historical lease classification as operating or capital leases. We also elected to combine lease and non-lease components and to exclude short-term leases from our consolidated balance sheets. We did not elect the hindsight practical expedient in determining the lease term for existing leases as of February 3, 2019.
The most significant impact of adoption was the recognition of operating lease assets and operating lease liabilities of $2.7 billion and $2.8 billion, respectively, while our accounting for existing capital leases (now referred to as finance leases) remained substantially unchanged. The cumulative impact of these changes decreased retained earnings by $22 million, which includes a $3 million net-of-tax adjustment made during the second quarter of fiscal 2020 related to on-adoption impairment charges. We expect the impact of adoption to be immaterial to our consolidated statements of earnings and consolidated statements of cash flows on an ongoing basis. As part of our adoption, we also modified our control procedures and processes, none of which materially affected our internal control over financial reporting. See Note 4, Leases, for additional information regarding our accounting policy for leases and additional disclosures.
The cumulative effect of the changes made to our Condensed Consolidated Balance Sheets for the adoption of this standard was as follows ($ in millions):
(a)Represents the reclassification of prepaid rent and leasehold acquisition costs to Operating lease assets. (b)Represents the derecognition of financing obligations and reclassification to Operating lease assets. (c)Represents the capitalization of operating lease assets and the reclassification of prepaid rent and leasehold acquisition costs, offset by the reclassification of straight-line rent accruals, tenant improvement allowances and vacant space reserves. (d)Represents the deferred tax impact of the on-adoption adjustments. (e)Represents the reclassification of straight-line rent accruals, tenant improvement allowances and vacant space reserves to Operating lease assets. (f)Represents the recognition of operating lease liabilities. (g)Represents the net-of-tax retained earnings impact of impairment charges and the derecognition of financing obligations.
Total Cash, Cash Equivalents and Restricted Cash
The reconciliation of cash, cash equivalents and restricted cash reported within the Condensed Consolidated Balance Sheets to the totals shown within the Condensed Consolidated Statements of Cash Flows was as follows ($ in millions):
Amounts included in restricted cash are pledged as collateral or restricted to use for workers’ compensation and general liability insurance claims. |
Acquisition |
6 Months Ended |
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Aug. 03, 2019 | |
Acquisition [Abstract] | |
Acquisition | 2. Acquisition
Critical Signal Technologies, Inc.
On May 9, 2019, we acquired all of the outstanding shares of Critical Signal Technologies, Inc. (“CST”), a health services company, for net cash consideration of $125 million. The acquisition of CST is aligned with our strategy to address health and wellness with a focus on aging seniors and how technology can help them live longer in their homes. The acquisition was accounted for using the acquisition method of accounting for business combinations. Accordingly, the cost was allocated to the underlying net assets based on their respective fair values, and the excess of the purchase price over the estimated fair value of the net assets acquired was recorded as goodwill. The purchase price allocation for the assets acquired and liabilities assumed is substantially complete, but may be subject to immaterial changes. The acquired assets were primarily comprised of $83 million of customer relationships (amortized over 15 years) recorded within Other assets on our Condensed Consolidated Balance Sheets as of August 3, 2019. Goodwill of $50 million was recorded and assigned to our GreatCall reporting unit and is not expected to be deductible for income tax purposes. We recorded $3 million of transaction costs related to the acquisition within Selling, general and administrative (“SG&A”) expenses on our Condensed Consolidated Statements of Earnings for the second quarter and first six months of fiscal 2020. Results of operations from the date of acquisition were included within our GreatCall operating segment, Domestic reportable segment and Services revenue category. The acquisition of CST was not material to the results of our operations. |
Fair Value Measurements |
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Fair Value Measurements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | 3. Fair Value Measurements
Fair value is the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. To measure fair value, we use a three-tier valuation hierarchy based upon observable and non-observable inputs:
Level 1 — Unadjusted quoted prices that are available in active markets for identical assets or liabilities at the measurement date.
Level 2 — Significant other observable inputs available at the measurement date, other than quoted prices included in Level 1, either directly or indirectly, including:
Quoted prices for similar assets or liabilities in active markets; Quoted prices for identical or similar assets or liabilities in non-active markets; Inputs other than quoted prices that are observable for the asset or liability; and Inputs that are derived principally from or corroborated by other observable market data.
Level 3 — Significant unobservable inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management’s estimates of market participant assumptions.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The fair value hierarchy requires the use of observable market data when available. In instances where the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular item to the fair value measurement in its entirety requires judgment, including the consideration of inputs specific to the asset or liability.
Financial assets and liabilities accounted for at fair value were as follows ($ in millions):
The following methods and assumptions were used to estimate the fair value of each class of financial instrument:
Money market funds. Our money market fund investments were measured at fair value as they trade in an active market using quoted market prices and, therefore, were classified as Level 1.
Time deposits. Our time deposits are balances held with banking institutions that cannot be withdrawn for specified terms without a penalty. Time deposits are held at face value plus accrued interest, which approximates fair value, and were classified as Level 2.
Commercial paper. Our investments in commercial paper were measured using inputs based upon quoted prices for similar instruments in active markets and, therefore, were classified as Level 2.
Foreign currency derivative instruments. Comprised primarily of foreign currency forward contracts, our foreign currency derivative instruments were measured at fair value using readily observable market inputs, such as quotations on forward foreign exchange points and foreign interest rates. Our foreign currency derivative instruments were classified as Level 2 as these instruments are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market.
Marketable securities that fund deferred compensation. The assets that fund our deferred compensation consist of investments in corporate-owned life insurance, the value of which is based on select mutual fund performance. These investments were classified as Level 1 as the shares of these mutual funds trade with sufficient frequency and volume to enable us to obtain pricing information on an ongoing basis.
Interest rate swap derivative instruments. Our interest rate swap contracts were measured at fair value using readily observable inputs, such as the LIBOR interest rate. Our interest rate swap derivative instruments were classified as Level 2 as these instruments are custom, over-the-counter contracts with various bank counterparties that are not traded in an active market.
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
Assets and liabilities that are measured at fair value on a nonrecurring basis relate primarily to our tangible fixed assets, operating lease assets, goodwill and other intangible assets, which are remeasured when the derived fair value is below the carrying value on our Condensed Consolidated Balance Sheets. For these assets, we do not periodically adjust the carrying value to fair value, except in the event of impairment. When we determine that impairment has occurred, the carrying value of the asset is reduced to fair value and the difference is recorded within Selling, general and administrative (“SG&A”) expenses on our Condensed Consolidated Statements of Earnings for non-restructuring charges.
Fair value remeasurements of property and equipment and operating lease assets were as follows ($ in millions):
(1)Remaining net carrying value approximates fair value. Because assets subject to long-lived asset impairment are not measured at fair value on a recurring basis, certain fair value measurements presented in the table may reflect values at earlier measurement dates and may no longer represent the fair values at August 3, 2019, and August 4, 2018. (2)Represents activity related to operating lease assets post-adoption of ASC 842, Leases.
All of the fair value remeasurements included in the table above were based on significant unobservable inputs (Level 3). Fixed asset fair values were primarily derived using a discounted cash flow ("DCF") model to estimate the present value of net cash flows that the asset or asset group was expected to generate. The key inputs to the DCF model generally included our forecasts of net cash generated from revenue, expenses and other significant cash outflows, such as capital expenditures, as well as an appropriate discount rate.
Fair Value of Financial Instruments
Our financial instruments, other than those presented in the disclosures above, include cash, receivables, other investments, accounts payable, other payables and long-term debt. The fair values of cash, receivables, accounts payable and other payables approximated carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Fair values for other investments held at cost are not readily available, but we estimate that the carrying values for these investments approximate fair value. See Note 7, Debt, for information about the fair value of our long-term debt. |
Leases |
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Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases | 4. Leases
The majority of our lease obligations are real estate operating leases from which we conduct the majority of our retail and distribution operations. Our finance leases are primarily equipment-related. For any lease with an initial term in excess of 12 months, the related lease assets and liabilities are recognized on our Condensed Consolidated Balance Sheets as either operating or finance leases at the inception of an agreement where it is determined that a lease exists. We have lease agreements that contain both lease and non-lease components. For lease agreements entered into or reassessed after the adoption of ASC 842, Leases, we have elected to combine lease and non-lease components for all classes of assets. Leases with an initial term of 12 months or less are not recorded on our Condensed Consolidated Balance Sheets; we recognize lease expense for these leases on a straight-line basis over the lease term. Operating lease assets represent the right to use an underlying asset for the lease term and operating lease liabilities represent the obligation to make lease payments arising from the lease. These assets and liabilities are recognized based on the present value of future payments over the lease term at the commencement date. We use a collateralized incremental borrowing rate based on the information available at the commencement date, including the lease term, in determining the present value of future payments. Our operating leases also typically require payment of real estate taxes, common area maintenance and insurance. These components comprise the majority of our variable lease cost and are excluded from the present value of our lease obligations. In instances where they are fixed, they are included due to our election to combine lease and non-lease components. Operating lease assets also include prepaid lease payments and initial direct costs, and are reduced by lease incentives. Our lease terms generally do not include options to extend or terminate the lease unless it is reasonably certain that the option will be exercised. Fixed payments may contain predetermined fixed rent escalations. We recognize the related rent expense on a straight-line basis from the commencement date to the end of the lease term.
Supplemental balance sheet information related to our leases was as follows ($ in millions):
(1)Finance leases are recorded net of accumulated depreciation of $48 million.
Components of our total lease cost were as follows ($ in millions):
(1)Includes short-term leases, which are immaterial. (2)Supply chain-related amounts are included in Cost of goods sold.
Other information related to our leases was as follows ($ in millions):
Future lease payments under our non-cancellable leases as of August 3, 2019, were as follows ($ in millions):
(1)Lease payments exclude $30 million of legally binding fixed costs for leases signed but not yet commenced, primarily related to operating leases.
In accordance with the prior guidance, ASC 840, Leases, our leases were previously designated as either capital, financing or operating. Previously designated capital leases are now considered finance leases under the new guidance, ASC 842, Leases, while our previously existing financing leases have been derecognized and reclassified as operating leases. The designation of operating leases remains substantially unchanged under the new guidance. The future minimum lease payments by fiscal year as determined prior to the adoption of ASC 842, Leases, under our previously designated capital, financing and operating leases (not including contingent rent) as disclosed in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, were as follows ($ in millions):
(1)Operating lease obligations do not include payments to landlords covering real estate taxes and common area maintenance. These charges, if included, would have increased total operating lease obligations by $0.8 billion at February 2, 2019. |
Goodwill and Intangible Assets |
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Goodwill and Intangible Assets | 5. Goodwill and Intangible Assets
All goodwill and intangible asset balances relate to our Domestic segment.
Goodwill
The gross carrying amounts and cumulative impairments of goodwill were as follows ($ in millions):
Indefinite-Lived Intangible Assets
We have indefinite-lived intangible assets primarily related to our Pacific Sales tradename which are recorded within Other assets on our Condensed Consolidated Balance Sheets. The carrying value of indefinite-lived intangible assets was $18 million as of August 3, 2019, February 2, 2019, and August 4, 2018.
Definite-Lived Intangible Assets
We have definite-lived intangible assets related to GreatCall and CST which are recorded within Other assets on our Condensed Consolidated Balance Sheets. Balances of our definite-lived intangible assets were as follows ($ in millions). We had no definite-lived intangible assets as of August 4, 2018.
We recorded $18 million and $35 million of aggregate amortization expense related to definite-lived intangible assets during the three and six months ended August 3, 2019, respectively, and $0 million for both the three and six months ended August 4, 2018. Amortization expense expected to be recognized in future periods is as follows ($ in millions):
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Derivative Instruments |
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Derivative Instruments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments | 6. Derivative Instruments
We manage our economic and transaction exposure to certain risks by using foreign currency derivative instruments and interest rate swaps. Our objective in holding derivatives is to reduce the volatility of net earnings, cash flows and net asset value associated with changes in foreign currency exchange rates and interest rates. We do not hold derivative instruments for trading or speculative purposes. We have no derivatives that have credit risk-related contingent features and we mitigate our credit risk by engaging with financial institutions with investment-grade credit ratings as our counterparties.
We record all derivative instruments on our Condensed Consolidated Balance Sheets at fair value and evaluate hedge effectiveness prospectively or retrospectively when electing to apply hedge accounting. We formally document all hedging relations at inception for derivative hedges and the underlying hedged items, as well as the risk management objectives and strategies for undertaking the hedge transaction. In addition, we have derivatives which are not designated as hedging instruments.
Net Investment Hedges
We use foreign exchange forward contracts to hedge against the effect of Canadian dollar exchange rate fluctuations on a portion of our net investment in our Canadian operations. The contracts have terms of up to 12 months. For a net investment hedge, we recognize changes in the fair value of the derivative as a component of foreign currency translation within other comprehensive income to offset a portion of the change in translated value of the net investment being hedged, until the investment is sold or liquidated. We limit recognition in net earnings of amounts previously recorded in other comprehensive income to circumstances such as complete or substantially complete liquidation of the net investment in the hedged foreign operation. We report the gains and losses, if any, related to the amount excluded from the assessment of hedge effectiveness in net earnings.
Interest Rate Swaps
We utilized "receive fixed-rate, pay variable-rate" interest rate swaps to mitigate the effect of interest rate fluctuations on our $500 million principal amount of notes due August 1, 2018, prior to their maturity, and currently have swaps outstanding on our $650 million principal amount of notes due March 15, 2021, and $500 million principal amount of notes due October 1, 2028. Our interest rate swap contracts are considered perfect hedges because the critical terms and notional amounts match those of our fixed-rate debt being hedged and are, therefore, accounted for as fair value hedges using the shortcut method. Under the shortcut method, we recognize the change in the fair value of the derivatives with an offsetting change to the carrying value of the debt. Accordingly, there is no impact on our Condensed Consolidated Statements of Earnings from the fair value of the derivatives.
Derivatives Not Designated as Hedging Instruments
We use foreign currency forward contracts to manage the impact of fluctuations in foreign currency exchange rates relative to recognized receivable and payable balances denominated in non-functional currencies. The contracts generally have terms of up to 12 months. These derivative instruments are not designated in hedging relationships and, therefore, we record gains and losses on these contracts directly to net earnings.
Summary of Derivative Balances
Gross fair values of our outstanding derivative instruments and the corresponding classifications were as follows ($ in millions):
Effects of derivative instruments on other comprehensive income ("OCI") were as follows ($ in millions):
Effects of derivatives not designated as hedging instruments on our Condensed Consolidated Statements of Earnings were as follows ($ in millions):
Effects of interest rate derivatives and adjustments to the carrying value of long-term debt on our Condensed Consolidated Statements of Earnings were as follows ($ in millions):
Notional amounts of our derivative instruments were as follows ($ in millions):
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Debt |
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Debt | 7. Debt
Short-Term Debt
We have a $1.25 billion five year senior unsecured revolving credit facility agreement with a syndicate of banks. The agreement permits borrowings of up to $1.25 billion and expires in April 2023. There were no borrowings outstanding as of August 3, 2019, February 2, 2019, or August 4, 2018.
Long-Term Debt
Long-term debt consisted of the following ($ in millions):
(1)See Note 4, Leases, for additional information regarding our lease obligations.
The fair value of total long-term debt, excluding debt discounts and issuance costs and lease obligations, approximated $1,295 million, $1,178 million, and $673 million as of August 3, 2019, February 2, 2019, and August 4, 2018, respectively, based primarily on market prices quoted from external sources, compared with carrying values of $1,228 million, $1,175 million, and $643 million, respectively. If long-term debt were measured at fair value in the financial statements, it would be classified primarily as Level 2 in the fair value hierarchy.
See Note 6, Debt, in the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, for additional information regarding the terms of our other debt facilities, debt instruments and other obligations. |
Revenue Recognition |
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Revenue Recognition | 8. Revenue Recognition
We generate revenue primarily from the sale of products and services, both as a principal and as an agent. We generate all of our operating revenue from contracts with customers. Our revenue excludes sales and usage-based taxes collected.
Revenue from product sales and services is reported net of sales refunds, which includes an estimate of future returns and contract cancellations based on historical refund rates, with a corresponding reduction to cost of sales. For revenue transactions that involve more than one performance obligation, we defer the revenue associated with any unsatisfied performance obligation until the obligation is satisfied.
Our contract liabilities primarily relate to product merchandise not yet delivered to customers; unredeemed gift cards; services not yet completed; services technical support contracts, where performance is satisfied over the duration of the contract; and options that provide a material right to customers, such as our customer loyalty programs. We do not have any material contract assets.
Information about our contracts with customers, which reflects the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied, was as follows ($ in millions):
(1)Receivables are recorded net of allowances for doubtful accounts of $13 million, $13 million, and $15 million as of August 3, 2019, February 2, 2019, and August 4, 2018, respectively.
During the first six months of fiscal 2020 and 2019, $638 million and $605 million of revenue was recognized, respectively, that was included in the contract liability balance at the beginning of the respective periods. No revenue was recognized from performance obligations satisfied in previous periods.
Revenue from our contract liability balances expected to be recognized in future periods if performance of the contract is expected to have a duration of more than one year is as follows ($ in millions):
(1)Amounts exclude unsatisfied performance obligations from contract liability balances with a duration of one year or less. The estimated transaction price revenue disclosed above also does not include amounts of variable consideration attributable to contracts where the consideration is constrained at August 3, 2019. See Note 13, Segments, for a disaggregation of revenue by reportable segment and product category, which represents how our chief operating decision maker reviews information internally to evaluate our financial performance and to make resource allocation and other decisions for the enterprise. |
Restructuring Charges |
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Restructuring Charges | 9. Restructuring Charges
Restructuring charges incurred in the second quarter and first six months of fiscal 2020 were $48 million, related to U.S. retail operating model changes. Restructuring charges incurred in the second quarter and first six months of fiscal 2019 were $17 million and $47 million, respectively, related to Best Buy Mobile.
U.S. Retail Operating Model
In the second quarter of fiscal 2020, we made changes primarily related to our U.S. retail operating model to increase organization effectiveness and create a more seamless customer experience across all channels. As a result, we incurred $48 million of charges related to termination benefits, including $10 million related to a voluntary early retirement offer. All charges incurred are from continuing operations and are presented in Restructuring charges on our Condensed Consolidated Statements of Earnings.
The following table summarizes our restructuring accrual activity during the first six months of fiscal 2020 related to U.S. retail operating model changes ($ in millions):
Best Buy Mobile
On March 1, 2018, we announced our intent to close all of our 257 remaining Best Buy Mobile stand-alone stores in the U.S. This decision was a result of changing economics in the mobile industry since we began opening these stores in 2006, along with the integration of our mobile model into our core stores and online channel, which are more economically compelling today. All restructuring charges related to this plan are from continuing operations and are presented in Restructuring charges on our Condensed Consolidated Statements of Earnings.
Restructuring charges incurred for Best Buy Mobile were as follows ($ in millions):
The following table summarizes our restructuring accrual activity during the first six months of fiscal 2019 related to Best Buy Mobile ($ in millions):
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Earnings per Share |
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Earnings per Share | 10. Earnings per Share
We compute our basic earnings per share based on the weighted-average number of common shares outstanding and our diluted earnings per share based on the weighted-average number of common shares outstanding adjusted by the number of additional shares that would have been outstanding had potentially dilutive common shares been issued. Potentially dilutive securities include stock options, nonvested share awards, dividend equivalents attached to nonvested share awards that are settled in shares of Best Buy common stock and shares issuable under our employee stock purchase plan. Nonvested market-based share awards and nonvested performance-based share awards are included in the average diluted shares outstanding for each period, if established market or performance criteria have been met at the end of the respective periods.
Reconciliations of the numerators and denominators of basic and diluted earnings per share were as follows ($ and shares in millions, except per share amounts):
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Repurchase of Common Stock |
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Repurchase of Common Stock | 11. Repurchase of Common Stock
On February 23, 2019, our Board of Directors ("Board") authorized a $3.0 billion share repurchase program. There is no expiration date governing the period over which we can repurchase shares under the February 2019 authorization.
Information regarding the shares we repurchased was as follows ($ and shares in millions, except per share amounts):
As of August 3, 2019, $2.7 billion of the $3.0 billion share repurchase authorization was available. Between the end of the second quarter of fiscal 2020 on August 3, 2019, and September 4, 2019, we repurchased an incremental 2.2 million shares of our common stock at a cost of $146 million. |
Comprehensive Income |
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Comprehensive Income | 12. Comprehensive Income
Changes in accumulated other comprehensive income, net of tax were as follows ($ in millions):
The gains and losses on our net investment hedges, which are included in foreign currency translation adjustments, were not material for the periods presented. Foreign currency translation adjustments do not include a provision for income tax expense when earnings from foreign operations are considered to be indefinitely reinvested outside the U.S. Refer to Note 11, Income Taxes, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, for additional information. |
Segments |
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Segments | 13. Segments
Our chief operating decision maker ("CODM") is our Chief Executive Officer. Our business is organized into two reportable segments: Domestic (which is comprised of all states, districts and territories of the U.S., including GreatCall) and International (which is comprised of all operations in Canada and Mexico). Our CODM has ultimate responsibility for enterprise decisions. Our CODM determines, in particular, resource allocation for, and monitors the performance of, the consolidated enterprise, the Domestic segment and the International segment. The Domestic segment managers and International segment managers have responsibility for operating decisions, allocating resources and assessing performance within their respective segments. Our CODM relies on internal management reporting that analyzes enterprise results to the net earnings level and segment results to the operating income level.
We aggregate our Domestic and GreatCall operating segments into one Domestic reportable segment. We also aggregate our Canada and Mexico businesses into one International operating segment, which represents the International reportable segment. The accounting policies of the segments are the same.
Revenue by reportable segment and product category was as follows ($ in millions):
(1)Refer to our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, for additional information regarding the key components of each revenue category.
Operating income by reportable segment and the reconciliation to earnings before income tax expense was as follows ($ in millions):
Assets by reportable segment were as follows ($ in millions):
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Contingencies |
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Contingencies [Abstract] | |
Contingencies | 14. Contingencies
We are involved in a number of legal proceedings. Where appropriate, we have made accruals with respect to these matters, which are reflected on our Condensed Consolidated Financial Statements. However, there are cases where liability is not probable or the amount cannot be reasonably estimated and, therefore, accruals have not been made. We provide disclosure of matters where we believe it is reasonably possible the impact may be material to our Condensed Consolidated Financial Statements.
Securities Actions
In February 2011, a purported class action lawsuit captioned, IBEW Local 98 Pension Fund, individually and on behalf of all others similarly situated v. Best Buy Co., Inc., et al., was filed against us and certain of our executive officers in the U.S. District Court for the District of Minnesota. This federal court action alleges, among other things, that we and the officers named in the complaint violated Sections 10(b) and 20A of the Exchange Act and Rule 10b-5 under the Exchange Act in connection with press releases and other statements relating to our fiscal 2011 earnings guidance that had been made available to the public. Additionally, in March 2011, a similar purported class action was filed by a single shareholder, Rene LeBlanc, against us and certain of our executive officers in the same court. In July 2011, after consolidation of the IBEW Local 98 Pension Fund and Rene LeBlanc actions, a consolidated complaint captioned, IBEW Local 98 Pension Fund v. Best Buy Co., Inc., et al., was filed and served. Following discovery and motion practice Plaintiffs moved to certify the purported class. By Order filed August 6, 2014, the court certified a class of persons or entities who acquired Best Buy common stock between 10:00 a.m. EDT on September 14, 2010, and December 13, 2010, and who were damaged by the alleged violations of law. The 8th Circuit Court of Appeals granted our request for interlocutory appeal. On April 12, 2016, the 8th Circuit held the trial court misapplied the law and reversed the class certification order. IBEW petitioned the 8th Circuit for a rehearing en banc, which was denied on June 1, 2016. On June 23, 2017, the trial court denied plaintiff's request to file a new Motion for Class Certification. On October 30, 2017, plaintiffs filed a motion for leave to file a second amended class action complaint which the Magistrate Judge denied on July 11, 2018. On August 24, 2018, the District Court Judge overruled plaintiff’s objections to that ruling, affirming the Magistrate Judge’s denial of leave to amend. On March 8, 2019, the District Court Judge granted Best Buy’s motion for summary judgment dismissing the remaining claims with prejudice. All appeal periods in IBEW have been exhausted and the matter is closed.
In June 2011, a purported shareholder derivative action captioned, Salvatore M. Talluto, Derivatively and on Behalf of Best Buy Co., Inc. v. Richard M. Schulze, et al., as Defendants and Best Buy Co., Inc. as Nominal Defendant, was filed against both present and former members of our Board serving during the relevant periods in fiscal 2011 and us as a nominal defendant in the U.S. District Court for the State of Minnesota. The lawsuit alleges that the director defendants breached their fiduciary duty, among other claims, including violation of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder, in failing to correct public misrepresentations and material misstatements and/or omissions regarding our fiscal 2011 earnings projections and, for certain directors, selling stock while in possession of material adverse non-public information. Additionally, in July 2011, a similar purported class action was filed by a single shareholder, Daniel Himmel, against us and certain of our executive officers in the same court. In November 2011, the respective lawsuits of Salvatore M. Talluto and Daniel Himmel were consolidated into a new action captioned, In Re: Best Buy Co., Inc. Shareholder Derivative Litigation, and a stay ordered pending the close of discovery in the consolidated IBEW Local 98 Pension Fund v. Best Buy Co., Inc., et al. case. Additionally, in June 2015, a similar purported class action was filed by a single shareholder, Khuong Tran, derivatively on behalf of Best Buy Co., Inc. against us and certain of our executive officers and directors in the same court. The Khuong Tran lawsuit has also been stayed pending the close of discovery in IBEW. In Tran, the court entered an Order for Dismissal Without Prejudice on March 27, 2019. In Re: Best Buy Co., Inc. Shareholder Derivative Litigation was dismissed without prejudice on August 6, 2019. The derivative matters are all closed.
Other Legal Proceedings
We are involved in various other legal proceedings arising in the normal course of conducting business. For such legal proceedings, we have accrued an amount that reflects the aggregate liability deemed probable and estimable, but this amount is not material to our consolidated financial position, results of operations or cash flows. Because of the preliminary nature of many of these proceedings, the difficulty in ascertaining the applicable facts relating to many of these proceedings, the variable treatment of claims made in many of these proceedings and the difficulty of predicting the settlement value of many of these proceedings, we are not able to estimate an amount or range of any reasonably possible additional losses. However, based upon our historical experience, the resolution of these proceedings is not expected to have a material effect on our consolidated financial position, results of operations or cash flows. |
Subsequent Event |
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Subsequent Event [Abstract] | |
Subsequent Event | 15. Subsequent Event
On July 23, 2019, we signed a definitive agreement to acquire the predictive healthcare technology business of BioSensics, LLC (“BioSensics”), for approximately $21 million, and the acquisition was completed on August 7, 2019. |
Basis of Presentation (Policies) |
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Basis of Presentation | Unless the context otherwise requires, the use of the terms “Best Buy,” “we,” “us” and “our” in these Notes to Condensed Consolidated Financial Statements refers to Best Buy Co., Inc. and, as applicable, its consolidated subsidiaries.
In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments necessary for a fair presentation as prescribed by accounting principles generally accepted in the United States (“GAAP”). All adjustments were comprised of normal recurring adjustments, except as noted in these Notes to Condensed Consolidated Financial Statements.
Historically, we have generated a large proportion of our revenue and earnings in the fiscal fourth quarter, which includes the majority of the holiday shopping season in the U.S., Canada and Mexico. Due to the seasonal nature of our business, interim results are not necessarily indicative of results for the entire fiscal year. The interim financial statements and the related notes included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and related notes included in our Annual Report on Form 10-K for the fiscal year ended February 2, 2019. The first six months of fiscal 2020 and fiscal 2019 included 26 weeks.
In order to align our fiscal reporting periods and comply with statutory filing requirements, we consolidate the financial results of our Mexico operations on a one-month lag. Our policy is to accelerate recording the effect of events occurring in the lag period that significantly affect our condensed consolidated financial statements. No such events were identified for the reported periods.
In preparing the accompanying condensed consolidated financial statements, we evaluated the period from August 3, 2019, through the date the financial statements were issued for material subsequent events requiring recognition or disclosure. Other than as disclosed in Note 15, Subsequent Event, no such events were identified for the reported periods. |
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Unadopted & Adopted Accounting Pronouncements | Unadopted Accounting Pronouncements
In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which eliminates the requirement to calculate the implied fair value of goodwill (i.e., Step 2 of the current goodwill impairment test) to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value (i.e., measure the charge based on the current Step 1). We do not believe the new guidance, which is effective for fiscal years beginning after December 15, 2019, will have a material impact on our consolidated financial statements.
In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement - Disclosure Framework (Topic 820). The updated guidance improves the disclosure requirements for fair value measurements. We do not believe the updated guidance, which is effective for fiscal years and interim periods within those fiscal years beginning after December 15, 2019, will have a material impact on our consolidated financial statements.
In August 2018, the FASB issued ASU 2018-15, Intangibles-Goodwill and Other - Internal Use Software (Subtopic 350-40): Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. This guidance requires companies to apply the internal-use software guidance in Accounting Standards Codification (“ASC”) 350-40 to implementation costs incurred in a hosting arrangement that is a service contract to determine whether to capitalize certain implementation costs or expense them as incurred. We do not believe the new guidance, which is effective for fiscal years beginning after December 15, 2019, will have a material impact on our consolidated financial statements.
Adopted Accounting Pronouncements
In February 2016, the FASB issued ASU 2016-02, Leases, which requires the recognition of operating lease assets and lease liabilities on the balance sheet. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. Under the new standard, disclosures are required to enable users of financial statements to assess the amount, timing and uncertainty of cash flows arising from leases.
In the first quarter of fiscal 2020, we adopted ASU 2016-02 using the “Comparatives Under 840 Option” approach to transition. Under this method, financial information related to periods prior to adoption will be as originally reported under the previous standard – ASC 840, Leases. The effects of adopting the new standard (ASC 842, Leases) in fiscal 2020 were recognized as a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal first quarter. We elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allows us to carry forward the historical lease classification as operating or capital leases. We also elected to combine lease and non-lease components and to exclude short-term leases from our consolidated balance sheets. We did not elect the hindsight practical expedient in determining the lease term for existing leases as of February 3, 2019.
The most significant impact of adoption was the recognition of operating lease assets and operating lease liabilities of $2.7 billion and $2.8 billion, respectively, while our accounting for existing capital leases (now referred to as finance leases) remained substantially unchanged. The cumulative impact of these changes decreased retained earnings by $22 million, which includes a $3 million net-of-tax adjustment made during the second quarter of fiscal 2020 related to on-adoption impairment charges. We expect the impact of adoption to be immaterial to our consolidated statements of earnings and consolidated statements of cash flows on an ongoing basis. As part of our adoption, we also modified our control procedures and processes, none of which materially affected our internal control over financial reporting. See Note 4, Leases, for additional information regarding our accounting policy for leases and additional disclosures.
The cumulative effect of the changes made to our Condensed Consolidated Balance Sheets for the adoption of this standard was as follows ($ in millions):
(a)Represents the reclassification of prepaid rent and leasehold acquisition costs to Operating lease assets. (b)Represents the derecognition of financing obligations and reclassification to Operating lease assets. (c)Represents the capitalization of operating lease assets and the reclassification of prepaid rent and leasehold acquisition costs, offset by the reclassification of straight-line rent accruals, tenant improvement allowances and vacant space reserves. (d)Represents the deferred tax impact of the on-adoption adjustments. (e)Represents the reclassification of straight-line rent accruals, tenant improvement allowances and vacant space reserves to Operating lease assets. (f)Represents the recognition of operating lease liabilities. (g)Represents the net-of-tax retained earnings impact of impairment charges and the derecognition of financing obligations. |
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Total Cash, Cash Equivalents and Restricted Cash | Total Cash, Cash Equivalents and Restricted Cash
The reconciliation of cash, cash equivalents and restricted cash reported within the Condensed Consolidated Balance Sheets to the totals shown within the Condensed Consolidated Statements of Cash Flows was as follows ($ in millions):
Amounts included in restricted cash are pledged as collateral or restricted to use for workers’ compensation and general liability insurance claims. |
Basis of Presentation (Tables) |
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Schedule of New Accounting Pronouncements and Changes in Accounting Principles |
(a)Represents the reclassification of prepaid rent and leasehold acquisition costs to Operating lease assets. (b)Represents the derecognition of financing obligations and reclassification to Operating lease assets. (c)Represents the capitalization of operating lease assets and the reclassification of prepaid rent and leasehold acquisition costs, offset by the reclassification of straight-line rent accruals, tenant improvement allowances and vacant space reserves. (d)Represents the deferred tax impact of the on-adoption adjustments. (e)Represents the reclassification of straight-line rent accruals, tenant improvement allowances and vacant space reserves to Operating lease assets. (f)Represents the recognition of operating lease liabilities. (g)Represents the net-of-tax retained earnings impact of impairment charges and the derecognition of financing obligations. |
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Total Cash, Cash Equivalents and Restricted Cash |
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Fair Value Measurements (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Fair Value Measurements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis |
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Summary of Fair Value Remeasurements of Property and Equipment Impairments |
(1)Remaining net carrying value approximates fair value. Because assets subject to long-lived asset impairment are not measured at fair value on a recurring basis, certain fair value measurements presented in the table may reflect values at earlier measurement dates and may no longer represent the fair values at August 3, 2019, and August 4, 2018. (2)Represents activity related to operating lease assets post-adoption of ASC 842, Leases. |
Leases (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Aug. 03, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Balance Sheet Information |
(1)Finance leases are recorded net of accumulated depreciation of $48 million. |
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Components of Lease Cost |
(1)Includes short-term leases, which are immaterial. (2)Supply chain-related amounts are included in Cost of goods sold. |
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Other Information |
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Future Lease Payments |
(1)Lease payments exclude $30 million of legally binding fixed costs for leases signed but not yet commenced, primarily related to operating leases.
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Future Lease Payments Under ASC 840 |
(1)Operating lease obligations do not include payments to landlords covering real estate taxes and common area maintenance. These charges, if included, would have increased total operating lease obligations by $0.8 billion at February 2, 2019. |
Goodwill and Intangible Assets (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Aug. 03, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross Carrying Amount of Goodwill and Cumulative Goodwill Impairment |
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Definite-Lived Intangible Assets |
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Amortization Expense Expected to be Recognized |
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Derivative Instruments (Tables) |
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Aug. 03, 2019 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross Fair Values of Outstanding Derivative Instruments |
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Effects of Derivative Instruments on OCI and Earnings |
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Effects of Derivatives Not Designated as Hedging Instruments on Earnings |
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Effects of Interest Rate Derivatives and Adjustments to LTD on Earnings |
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Notional Amount of Derivative Instruments |
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Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Debt [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-term Debt |
(1)See Note 4, Leases, for additional information regarding our lease obligations. |
Revenue Recognition (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Revenue Recognition [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contract Balances and Changes in Contract Balances | Information about our contracts with customers, which reflects the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied, was as follows ($ in millions):
(1)Receivables are recorded net of allowances for doubtful accounts of $13 million, $13 million, and $15 million as of August 3, 2019, February 2, 2019, and August 4, 2018, respectively.
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Expected Timimg for Satisfying Remaining Performance Obligation |
(1)Amounts exclude unsatisfied performance obligations from contract liability balances with a duration of one year or less. The estimated transaction price revenue disclosed above also does not include amounts of variable consideration attributable to contracts where the consideration is constrained at August 3, 2019. |
Restructuring Charges (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Accrual Activity |
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Best Buy Mobile [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Composition of Restructuring Charges |
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Restructuring Accrual Activity |
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Earnings per Share (Tables) |
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Earnings per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Calculation of Numerator and Denominator in Earnings Per Share |
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Repurchase of Common Stock (Tables) |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share Repurchases |
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Comprehensive Income (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Accumulated Other Comprehensive Income |
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Segments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Aug. 03, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Revenue by Reportable Segment and Product Category |
(1)Refer to our Annual Report on Form 10-K for the fiscal year ended February 2, 2019, for additional information regarding the key components of each revenue category. |
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Operating Income by Reportable Segment and Reconciliation to Earnings Before Income Tax Expense |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Assets by Reportable Segment |
|
Basis of Presentation (Narrative) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Operating lease assets | $ 2,774 | $ 2,732 | ||||||||||
Operating lease liabilities | [1] | 2,873 | ||||||||||
Retained earnings | 2,965 | 2,963 | $ 2,985 | $ 2,863 | ||||||||
Adoption of ASU 2016-02 [Member] | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Operating lease assets | 2,700 | |||||||||||
Operating lease liabilities | 2,800 | |||||||||||
Restatement Adjustment [Member] | Adoption of ASU 2016-02 [Member] | ||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||||||||
Operating lease assets | [2] | 2,732 | ||||||||||
Retained earnings | $ 3 | $ (22) | [3] | |||||||||
|
Basis of Presentation (Schedule of Cumulative On Adoption Impact ) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Assets | ||||||||||||||||||||
Other current assets | $ 409 | $ 401 | $ 466 | $ 510 | ||||||||||||||||
Net property and equipment | 2,361 | 2,337 | 2,510 | 2,432 | ||||||||||||||||
Operating lease assets | 2,774 | 2,732 | ||||||||||||||||||
Other assets | 686 | 611 | 606 | 365 | ||||||||||||||||
Liabilities | ||||||||||||||||||||
Accrued liabilities | 799 | 954 | 982 | 813 | ||||||||||||||||
Current portion of operating lease liabilities | 643 | 712 | ||||||||||||||||||
Current portion of long-term debt | 14 | 13 | 56 | 47 | ||||||||||||||||
Long-term liabilities | 640 | 635 | 750 | 777 | ||||||||||||||||
Long-term operating lease liabilities | 2,230 | 2,135 | ||||||||||||||||||
Long-term debt | 1,247 | 1,192 | 1,332 | 801 | ||||||||||||||||
Equity | ||||||||||||||||||||
Retained earnings | 2,965 | 2,963 | 2,985 | $ 2,863 | ||||||||||||||||
As Reported [Member] | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Other current assets | 466 | |||||||||||||||||||
Net property and equipment | 2,510 | |||||||||||||||||||
Other assets | 606 | |||||||||||||||||||
Liabilities | ||||||||||||||||||||
Accrued liabilities | 982 | |||||||||||||||||||
Current portion of long-term debt | 56 | |||||||||||||||||||
Long-term liabilities | 750 | |||||||||||||||||||
Long-term debt | 1,332 | |||||||||||||||||||
Equity | ||||||||||||||||||||
Retained earnings | $ 2,985 | |||||||||||||||||||
Adoption of ASU 2016-02 [Member] | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Operating lease assets | 2,700 | |||||||||||||||||||
Adoption of ASU 2016-02 [Member] | Restatement Adjustment [Member] | ||||||||||||||||||||
Assets | ||||||||||||||||||||
Other current assets | [1] | (65) | ||||||||||||||||||
Net property and equipment | [2] | (173) | ||||||||||||||||||
Operating lease assets | [3] | 2,732 | ||||||||||||||||||
Other assets | [4] | 5 | ||||||||||||||||||
Liabilities | ||||||||||||||||||||
Accrued liabilities | [5] | (28) | ||||||||||||||||||
Current portion of operating lease liabilities | [6] | 712 | ||||||||||||||||||
Current portion of long-term debt | [2] | (43) | ||||||||||||||||||
Long-term liabilities | [5] | (115) | ||||||||||||||||||
Long-term operating lease liabilities | [6] | 2,135 | ||||||||||||||||||
Long-term debt | [2] | (140) | ||||||||||||||||||
Equity | ||||||||||||||||||||
Retained earnings | $ 3 | $ (22) | [7] | |||||||||||||||||
|
Basis of Presentation (Total Cash, Cash Equivalents and Restricted Cash) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
Feb. 03, 2018 |
---|---|---|---|---|
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | ||||
Cash and cash equivalents | $ 1,289 | $ 1,980 | $ 1,865 | |
Restricted cash included in Other current assets | 115 | 203 | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Total | $ 1,404 | $ 2,184 | $ 2,068 | $ 1,300 |
Acquisition (Details) - USD ($) $ in Millions |
6 Months Ended | |||
---|---|---|---|---|
May 09, 2019 |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
|
Business Acquisition [Line Items] | ||||
Total purchase price, net of cash acquired | $ 125 | |||
Goodwill | 965 | $ 915 | $ 425 | |
Critical Signal Technologies, Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Total purchase price, net of cash acquired | $ 125 | |||
Goodwill | 50 | |||
Transaction costs | $ 3 | |||
Customer Relationships [Member] | Critical Signal Technologies, Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Intangible assets | $ 83 | |||
Amortization period | 15 years |
Fair Value Measurements (Fair Value, Assets and Liabilities Measured on Recurring Basis) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
---|---|---|---|
Level 1 [Member] | Money market funds [Member] | |||
ASSETS | |||
Cash and cash equivalents | $ 375 | $ 98 | $ 334 |
Other current assets | 10 | 82 | 74 |
Level 1 [Member] | Marketable securities that fund deferred compensation [Member] | |||
ASSETS | |||
Other assets | 47 | 44 | 100 |
Level 2 [Member] | Time deposits [Member] | |||
ASSETS | |||
Cash and cash equivalents | 300 | ||
Short-term investments | 221 | 465 | |
Other current assets | 102 | 101 | 101 |
Level 2 [Member] | Commercial paper [Member] | |||
ASSETS | |||
Short-term investments | 99 | ||
Level 2 [Member] | Foreign currency derivative instruments [Member] | |||
ASSETS | |||
Other current assets | 5 | ||
Level 2 [Member] | Interest rate swap derivative instruments [Member] | |||
ASSETS | |||
Other assets | $ 78 | 26 | |
Liabilities | |||
Long-term liabilities | $ 1 | $ 7 |
Leases (Supplemental Balance Sheet Information) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 03, 2019 |
||
---|---|---|---|---|
Assets | ||||
Operating leases | $ 2,774 | $ 2,732 | ||
Finance leases | [1] | 36 | ||
Total lease assets | 2,810 | |||
Current: | ||||
Operating leases | 643 | 712 | ||
Finance leases | 14 | |||
Non-current: | ||||
Operating leases | 2,230 | $ 2,135 | ||
Finance leases | 25 | |||
Total lease liabilities | 2,912 | |||
Accumulated depreciation | $ 48 | |||
|
Leases (Components of Lease Cost) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Aug. 03, 2019 |
Aug. 03, 2019 |
||||||
Leases [Abstract] | |||||||
Operating lease cost | [1],[2] | $ 194 | $ 389 | ||||
Depreciation of lease assets | [2] | 4 | 7 | ||||
Interest on lease liabilities | 1 | ||||||
Variable lease cost | [2] | 68 | 135 | ||||
Sublease income | (5) | (9) | |||||
Total lease cost | $ 261 | $ 523 | |||||
|
Leases (Other Information) (Details) $ in Millions |
3 Months Ended | 6 Months Ended |
---|---|---|
Aug. 03, 2019
USD ($)
|
Aug. 03, 2019
USD ($)
|
|
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ 203 | $ 404 |
Operating cash flows from finance leases | 1 | |
Financing cash flows from finance leases | 4 | 8 |
Lease assets obtained in exchange for new lease liabilities: | ||
Operating leases | 247 | 394 |
Finance leases | $ 2 | $ 4 |
Weighted average remaining lease term: | ||
Operating leases | 5 years 4 months 24 days | 5 years 4 months 24 days |
Finance leases | 5 years 2 months 12 days | 5 years 2 months 12 days |
Weighted average discount rate: | ||
Operating leases | 3.40% | 3.40% |
Finance leases | 4.40% | 4.40% |
Leases (Future Lease Payments) (Details) $ in Millions |
Aug. 03, 2019
USD ($)
|
|||||
---|---|---|---|---|---|---|
Operating Leases | ||||||
Remainder of fiscal 2020 | $ 341 | [1] | ||||
Fiscal 2021 | 756 | [1] | ||||
Fiscal 2022 | 619 | [1] | ||||
Fiscal 2023 | 466 | [1] | ||||
Fiscal 2024 | 340 | [1] | ||||
Fiscal 2025 | 234 | [1] | ||||
Thereafter | 407 | [1] | ||||
Total future undiscounted lease payments | 3,163 | [1] | ||||
Less imputed interest | (290) | [1] | ||||
Total reported lease liability | 2,873 | [1] | ||||
Financing Leases | ||||||
Remainder of fiscal 2020 | 8 | [1] | ||||
Fiscal 2021 | 13 | [1] | ||||
Fiscal 2022 | 9 | [1] | ||||
Fiscal 2023 | 5 | [1] | ||||
Fiscal 2024 | 3 | [1] | ||||
Fiscal 2025 | 2 | [1] | ||||
Thereafter | 5 | [1] | ||||
Total future undiscounted lease payments | 45 | [1] | ||||
Less imputed interest | (6) | [1] | ||||
Total reported lease liability | 39 | [1],[2] | ||||
Leases signed but not yet commenced | $ 30 | |||||
|
Leases (Future Lease Payments Under ASC 840) (Details) $ in Millions |
12 Months Ended | |||
---|---|---|---|---|
Feb. 02, 2019
USD ($)
| ||||
Capital Leases | ||||
Fiscal 2020 | $ 14 | |||
Fiscal 2021 | 11 | |||
Fiscal 2022 | 7 | |||
Fiscal 2023 | 4 | |||
Fiscal 2024 | 2 | |||
Thereafter | 7 | |||
Total minimum lease payments | 45 | |||
Less amount representing interest | (6) | |||
Present value of minimum lease payments | 39 | |||
Less current maturities | (12) | |||
Present value of minimum lease maturities, less current maturities | 27 | |||
Financing Leases | ||||
Fiscal 2020 | 48 | |||
Fiscal 2021 | 42 | |||
Fiscal 2022 | 35 | |||
Fiscal 2023 | 24 | |||
Fiscal 2024 | 16 | |||
Thereafter | 40 | |||
Total minimum lease payments | 205 | |||
Less amount representing interest | (24) | |||
Present value of minimum lease payments | 181 | |||
Less current maturities | (43) | |||
Present value of minimum lease maturities, less current maturities | 138 | |||
Operating Lease | ||||
Fiscal 2020 | 700 | [1] | ||
Fiscal 2021 | 648 | [1] | ||
Fiscal 2022 | 513 | [1] | ||
Fiscal 2023 | 371 | [1] | ||
Fiscal 2024 | 253 | [1] | ||
Thereafter | 476 | [1] | ||
Total minimum lease payments | 2,961 | [1] | ||
Operating lease obligations excluded | $ 800 | |||
|
Goodwill and Intangible Assets (Narrative) (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
Feb. 02, 2019 |
|
Goodwill and Intangible Assets [Abstract] | |||||
Indefinite-lived intangible | $ 18,000,000 | $ 18,000,000 | $ 18,000,000 | $ 18,000,000 | $ 18,000,000 |
Definite-lived intangible assets | 0 | 0 | |||
Amortization expense | $ 18,000,000 | $ 0 | $ 35,000,000 | $ 0 |
Goodwill and Intangible Assets (Gross Carrying Amount of Goodwill and Cumulative Goodwill Impairment) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
---|---|---|---|
Goodwill and Intangible Assets [Abstract] | |||
Gross Carrying Amount | $ 1,640 | $ 1,590 | $ 1,100 |
Cumulative Impairment | $ (675) | $ (675) | $ (675) |
Goodwill and Intangible Assets (Definite-Lived Intangible Assets) (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Aug. 03, 2019 |
Feb. 02, 2019 |
|
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 456 | $ 373 |
Accumulated Amortization | $ 58 | 23 |
Weighted-Average Useful Life Remaining | 7 years | |
Customer Relationships [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 341 | 258 |
Accumulated Amortization | $ 42 | 16 |
Weighted-Average Useful Life Remaining | 7 years 4 months 24 days | |
Tradenames [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 63 | 63 |
Accumulated Amortization | $ 7 | 3 |
Weighted-Average Useful Life Remaining | 7 years 2 months 12 days | |
Developed Technology [Member] | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 52 | 52 |
Accumulated Amortization | $ 9 | $ 4 |
Weighted-Average Useful Life Remaining | 4 years 2 months 12 days |
Goodwill and Intangible Assets (Amortization Expense Expected to be Recognized) (Details) $ in Millions |
Aug. 03, 2019
USD ($)
|
---|---|
Goodwill and Intangible Assets [Abstract] | |
Remainder of fiscal 2020 | $ 37 |
Fiscal 2021 | 73 |
Fiscal 2022 | 73 |
Fiscal 2023 | 73 |
Fiscal 2024 | 54 |
Fiscal 2025 | 16 |
Thereafter | $ 72 |
Derivative Instruments (Narrative) (Details) |
6 Months Ended |
---|---|
Aug. 03, 2019
USD ($)
| |
Not Designated as Hedging Instrument [Member] | |
Derivative [Line Items] | |
Derivative, Term of Contract | 12 months |
Derivatives designated as net investment hedges | Designated as Hedging Instrument [Member] | |
Derivative [Line Items] | |
Derivative, Term of Contract | 12 months |
Notes due 2018 [Member] | |
Derivative [Line Items] | |
Debt Instrument, Face Amount | $ 500,000,000 |
Notes due 2021 [Member] | |
Derivative [Line Items] | |
Debt Instrument, Face Amount | 650,000,000 |
Notes due 2028 [Member] | |
Derivative [Line Items] | |
Debt Instrument, Face Amount | $ 500,000,000 |
Derivative Instruments (Gross Fair Values of Outstanding Derivative Instruments) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
---|---|---|---|
Not Designated as Hedging Instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Assets | $ 78 | $ 26 | $ 5 |
Interest rate swap derivative instruments [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | 78 | 25 | (7) |
Other current assets | Derivatives designated as net investment hedges | Not Designated as Hedging Instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Assets | 5 | ||
Other current assets and Other assets | Interest rate swap derivative instruments [Member] | Not Designated as Hedging Instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Assets | $ 78 | 26 | |
Long-term liabilities | Interest rate swap derivative instruments [Member] | Not Designated as Hedging Instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Liabilities | $ 1 | $ 7 |
Derivative Instruments (Effects of Derivative Instruments on OCI and Earnings) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended |
---|---|---|
Aug. 04, 2018 |
Aug. 04, 2018 |
|
Not Designated as Hedging Instrument [Member] | Derivatives designated as net investment hedges | ||
Derivatives, Fair Value [Line Items] | ||
Pre-tax gain recognized in OCI | $ 3 | $ 19 |
Derivative Instruments (Effects of Derivatives Not Designated as Hedging Instruments on Earnings) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |
---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 04, 2018 |
|
SG&A [Member] | Foreign exchange forward contracts | Not Designated as Hedging Instrument [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Gain Recognized | $ (1) | $ 1 | $ 1 |
Derivative Instruments (Effects of Interest Rate Derivatives and Adjustments to LTD on Earnings) (Details) - Not Designated as Hedging Instrument [Member] - Interest Expense [Member] - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
|
Interest rate swap derivative instruments [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Gain (Loss) Recognized | $ 55 | $ 3 | $ 53 | $ (1) |
Carrying Value Of Long Term Debt [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Gain (Loss) Recognized | $ (55) | $ (3) | $ (53) | $ 1 |
Derivative Instruments (Notional Amount of Derivative Instruments) (Details) - Not Designated as Hedging Instrument [Member] - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
---|---|---|---|
Derivatives, Fair Value [Line Items] | |||
Notional Amount | $ 1,206 | $ 1,174 | $ 750 |
Derivatives designated as net investment hedges | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 23 | 15 | 59 |
Interest rate swap derivative instruments [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | 1,150 | 1,150 | 650 |
Foreign exchange forward contracts | |||
Derivatives, Fair Value [Line Items] | |||
Notional Amount | $ 33 | $ 9 | $ 41 |
Debt (Narrative) (Short-Term Debt) (Details) - Revolving Credit Facility [Member] - USD ($) |
6 Months Ended | ||
---|---|---|---|
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
|
Line of Credit Facility [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 1,250,000,000 | ||
Debt instrument, term | 5 years | ||
Outstanding borrowings | $ 0 | $ 0 | $ 0 |
Debt (Narrative) (Long-Term Debt) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
---|---|---|---|
Debt [Abstract] | |||
Long-term Debt, Fair Value | $ 1,295 | $ 1,178 | $ 673 |
Carrying value | $ 1,228 | $ 1,175 | $ 643 |
Debt (Schedule of Long-Term Debt) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
|||||
---|---|---|---|---|---|---|---|---|---|
Debt Instrument [Line Items] | |||||||||
Subtotal | $ 1,228 | $ 1,175 | $ 643 | ||||||
Debt discounts and issuance costs | (6) | (7) | (2) | ||||||
Financing lease obligations | [1] | 181 | 188 | ||||||
Capital lease obligations | [1] | 39 | 19 | ||||||
Finance lease obligations | [1],[2] | 39 | |||||||
Total long-term debt | 1,261 | 1,388 | 848 | ||||||
Total long-term debt | 14 | $ 13 | 56 | 47 | |||||
Total long-term debt, less current portion | 1,247 | $ 1,192 | 1,332 | 801 | |||||
Interest rate swap derivative instruments [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Interest rate swap valuation adjustments | 78 | 25 | (7) | ||||||
Notes due 2021 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt | $ 650 | 650 | $ 650 | ||||||
Interest rate | 5.50% | ||||||||
Notes due 2028 [Member] | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term debt | $ 500 | $ 500 | |||||||
Interest rate | 4.45% | ||||||||
|
Revenue Recognition (Narrative) (Details) - USD ($) |
6 Months Ended | |
---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
|
Revenue Recognition [Abstract] | ||
Revenue recognized | $ 638,000,000 | $ 605,000,000 |
Revenue recognized from performance obligations satisfied in previous periods | $ 0 | $ 0 |
Revenue Recognition (Receivables and Contract Liabilities from Contracts with Customers) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
||
---|---|---|---|---|---|
Revenue Recognition [Abstract] | |||||
Receivables, net | [1] | $ 561 | $ 565 | $ 584 | |
Short-term contract liabilities included in: | |||||
Unredeemed gift cards | 264 | 290 | 275 | ||
Deferred revenue | 468 | 446 | 438 | ||
Accrued liabilities | 149 | 146 | 148 | ||
Long-term contract liabilities included in: | |||||
Long-term liabilities | 9 | 11 | 15 | ||
Receivables, allowance for doubtful accounts | $ 13 | $ 13 | $ 15 | ||
|
Revenue Recognition (Expected Timimg for Satisfying Remaining Performance Obligation) (Details) $ in Millions |
Aug. 03, 2019
USD ($)
|
|||
---|---|---|---|---|
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-08-03 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Estimated revenue from our contract liability balances | $ 6 | [1] | ||
Performance obligations from contract liability balances, duration | 1 year | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-02-02 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Estimated revenue from our contract liability balances | $ 8 | [1] | ||
Performance obligations from contract liability balances, duration | 1 year | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-31 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Estimated revenue from our contract liability balances | $ 4 | [1] | ||
Performance obligations from contract liability balances, duration | 1 year | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-30 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Estimated revenue from our contract liability balances | $ 1 | [1] | ||
Performance obligations from contract liability balances, duration | 1 year | |||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-29 | ||||
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | ||||
Estimated revenue from our contract liability balances | [1] | |||
Performance obligations from contract liability balances, duration | 1 year | |||
|
Restructuring Charges (Narrative) (Details) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Aug. 03, 2019
USD ($)
|
Aug. 04, 2018
USD ($)
|
Aug. 03, 2019
USD ($)
|
Aug. 04, 2018
USD ($)
|
Feb. 02, 2019
USD ($)
|
Mar. 01, 2018
store
|
Feb. 03, 2018
USD ($)
|
|
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | $ 48 | $ 17 | $ 48 | $ 47 | |||
U.S. Operating Model [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 48 | 48 | |||||
Best Buy Mobile [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 17 | 47 | |||||
Number of stores to be closed | store | 257 | ||||||
Restructuring reserve | 3 | 3 | $ 8 | ||||
Facility closure and other costs [Member] | Best Buy Mobile [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 20 | 49 | |||||
Restructuring reserve | 2 | 2 | |||||
Voluntary Early Retirement [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 10 | ||||||
Termination benefits [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | 48 | ||||||
Termination benefits [Member] | U.S. Operating Model [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring reserve | $ 40 | $ 40 | |||||
Termination benefits [Member] | Best Buy Mobile [Member] | |||||||
Restructuring Cost and Reserve [Line Items] | |||||||
Restructuring charges | (3) | (2) | |||||
Restructuring reserve | $ 1 | $ 1 | $ 8 |
Restructuring Charges (Restructuring Accrual Activity) (Details) - USD ($) $ in Millions |
6 Months Ended | ||||
---|---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
||||
Best Buy Mobile [Member] | |||||
Restructuring Reserve [Roll Forward] | |||||
Balances | $ 8 | ||||
Charges | 50 | ||||
Cash payments | (51) | ||||
Adjustments | [1] | (4) | |||
Balances | 3 | ||||
Best Buy Mobile [Member] | Termination benefits [Member] | |||||
Restructuring Reserve [Roll Forward] | |||||
Balances | 8 | ||||
Charges | 1 | ||||
Cash payments | (5) | ||||
Adjustments | [1] | (3) | |||
Balances | 1 | ||||
Best Buy Mobile [Member] | Facility closure and other costs [Member] | |||||
Restructuring Reserve [Roll Forward] | |||||
Charges | 49 | ||||
Cash payments | (46) | ||||
Adjustments | [1] | (1) | |||
Balances | $ 2 | ||||
U.S. Operating Model [Member] | Termination benefits [Member] | |||||
Restructuring Reserve [Roll Forward] | |||||
Balances | |||||
Charges | 48 | ||||
Cash payments | (8) | ||||
Balances | $ 40 | ||||
|
Restructuring Charges (Composition of Restructuring Charges) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
|
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 48 | $ 17 | $ 48 | $ 47 |
Termination benefits [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 48 | |||
Best Buy Mobile [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 17 | 47 | ||
Cumulative Amount | 56 | 56 | ||
Best Buy Mobile [Member] | Property and equipment impairments [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Cumulative Amount | 1 | 1 | ||
Best Buy Mobile [Member] | Termination benefits [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | (3) | (2) | ||
Cumulative Amount | 6 | 6 | ||
Best Buy Mobile [Member] | Facility closure and other costs [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 20 | $ 49 | ||
Cumulative Amount | $ 49 | $ 49 |
Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
|
Earnings per Share [Abstract] | ||||
Net earnings | $ 238 | $ 244 | $ 503 | $ 452 |
Weighted-average common shares outstanding (in shares) | 267.1 | 279.0 | 267.4 | 280.8 |
Dilutive effect of stock compensation plan awards | 2.3 | 4.7 | 3.5 | 5.2 |
Weighted-average common shares outstanding, assuming dilution | 269.4 | 283.7 | 270.9 | 286.0 |
Potential shares which were anti-dilutive and excluded from weighted-average share computations | 0.9 | 0.1 | 0.9 | 0.1 |
Basic earnings per share | $ 0.89 | $ 0.88 | $ 1.88 | $ 1.61 |
Diluted earnings per share | $ 0.89 | $ 0.86 | $ 1.86 | $ 1.58 |
Repurchase of Common Stock (Narrative) (Details) - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 04, 2019 |
Aug. 03, 2019 |
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
|
Stock Repurchases [Line Items] | ||||||
Total cost of shares repurchased | $ 230 | $ 375 | $ 336 | $ 774 | ||
Number of shares repurchased | 3.3 | 5.0 | 4.8 | 10.6 | ||
February 2019 Share Repurchase Program [Member] | ||||||
Stock Repurchases [Line Items] | ||||||
Stock Repurchase Program, Authorized Amount | $ 3,000 | $ 3,000 | $ 3,000 | |||
Number of shares repurchased | 2.2 | |||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 2,700 | $ 2,700 | $ 2,700 | |||
Subsequent Event [Member] | February 2019 Share Repurchase Program [Member] | ||||||
Stock Repurchases [Line Items] | ||||||
Total cost of shares repurchased | $ 146 |
Repurchase of Common Stock (Schedule of share repurchases) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
|
Equity [Abstract] | ||||
Total cost of shares repurchased | $ 230 | $ 375 | $ 336 | $ 774 |
Average price per share | $ 69.71 | $ 74.80 | $ 70.04 | $ 73.21 |
Number of shares repurchased | 3.3 | 5.0 | 4.8 | 10.6 |
Comprehensive Income (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |
---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 04, 2018 |
|
Accumulated Foreign Currency Adjustment Including Portion Attributable to Noncontrolling Interest [Member] | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Foreign currency translation adjustments | $ 5 | $ (14) | $ (18) |
Segments (Narrative) (Details) |
6 Months Ended |
---|---|
Aug. 03, 2019
segment
| |
Segment [Abstract] | |
Number of Reportable Segments | 2 |
Segments (Revenue by Reportable Segment and Product Category) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | |||||
---|---|---|---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | $ 9,536 | $ 9,379 | $ 18,678 | $ 18,488 | |||
Domestic Segment [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 8,821 | 8,639 | 17,302 | 17,051 | ||
Domestic Segment [Member] | Computing and Mobile Phones [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 3,917 | 3,923 | 7,768 | 7,822 | ||
Domestic Segment [Member] | Consumer Electronics [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 2,780 | 2,770 | 5,442 | 5,426 | ||
Domestic Segment [Member] | Appliances [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 1,138 | 1,013 | 2,099 | 1,895 | ||
Domestic Segment [Member] | Entertainment [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 439 | 512 | 912 | 1,059 | ||
Domestic Segment [Member] | Services [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 510 | 384 | 1,008 | 777 | ||
Domestic Segment [Member] | Other [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 37 | 37 | 73 | 72 | ||
International Segment [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 715 | 740 | 1,376 | 1,437 | ||
International Segment [Member] | Computing and Mobile Phones [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 308 | 335 | 613 | 666 | ||
International Segment [Member] | Consumer Electronics [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 231 | 217 | 434 | 423 | ||
International Segment [Member] | Appliances [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 83 | 86 | 142 | 147 | ||
International Segment [Member] | Entertainment [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 36 | 43 | 72 | 85 | ||
International Segment [Member] | Services [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | 45 | 41 | 88 | 81 | ||
International Segment [Member] | Other [Member] | |||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||||||
Revenues | [1] | $ 12 | $ 18 | $ 27 | $ 35 | ||
|
Segments (Operating Income by Reportable Segment and Reconciliation to Earnings Before Income Tax Expense) (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Aug. 03, 2019 |
Aug. 04, 2018 |
Aug. 03, 2019 |
Aug. 04, 2018 |
|
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Operating income | $ 313 | $ 335 | $ 647 | $ 600 |
Investment income and other | 10 | 13 | 24 | 24 |
Interest expense | (16) | (19) | (34) | (38) |
Earnings before income tax expense | 307 | 329 | 637 | 586 |
Domestic Segment [Member] | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Operating income | 309 | 329 | 641 | 596 |
International Segment [Member] | ||||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | ||||
Operating income | $ 4 | $ 6 | $ 6 | $ 4 |
Segments (Assets by Reportable Segment) (Details) - USD ($) $ in Millions |
Aug. 03, 2019 |
Feb. 02, 2019 |
Aug. 04, 2018 |
---|---|---|---|
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | $ 14,978 | $ 12,901 | $ 11,993 |
Domestic Segment [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 13,714 | 11,908 | 10,912 |
International Segment [Member] | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | $ 1,264 | $ 993 | $ 1,081 |
Subsequent Event (Details) - USD ($) $ in Millions |
6 Months Ended | |
---|---|---|
Aug. 07, 2019 |
Aug. 03, 2019 |
|
Subsequent Event [Line Items] | ||
Total purchase price, net of cash acquired | $ 125 | |
BioSensics, LLC [Member] | Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Total purchase price, net of cash acquired | $ 21 |