Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Nov. 02, 2018 | Nov. 30, 2018 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | LOWES COMPANIES INC | |
Entity Central Index Key | 60,667 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 2, 2018 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --02-01 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity emerging growth company | false | |
Entity small business | false | |
Entity Common Stock, Shares Outstanding | 802,957,007 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 |
Current assets: | |||
Cash and cash equivalents | $ 1,668 | $ 588 | $ 743 |
Short-term investments | 208 | 102 | 85 |
Merchandise inventory - net | 12,365 | 11,393 | 12,393 |
Other current assets | 897 | 689 | 788 |
Total current assets | 15,138 | 12,772 | 14,009 |
Property, less accumulated depreciation | 18,923 | 19,721 | 19,818 |
Long-term investments | 290 | 408 | 370 |
Deferred income taxes - net | 285 | 168 | 347 |
Goodwill | 1,272 | 1,307 | 1,327 |
Other assets | 805 | 915 | 912 |
Total assets | 36,713 | 35,291 | 36,783 |
Current liabilities: | |||
Short-term borrowings | 0 | 1,137 | 171 |
Current maturities of long-term debt | 1,117 | 294 | 297 |
Accounts payable | 9,283 | 6,590 | 8,903 |
Accrued compensation and employee benefits | 806 | 747 | 808 |
Deferred revenue | 1,356 | 1,378 | 1,404 |
Other current liabilities | 2,507 | 1,950 | 2,155 |
Total current liabilities | 15,069 | 12,096 | 13,738 |
Long-term debt, excluding current maturities | 14,460 | 15,564 | 15,570 |
Deferred revenue - extended protection plans | 827 | 803 | 794 |
Other liabilities | 963 | 955 | 939 |
Total liabilities | 31,319 | 29,418 | 31,041 |
Shareholders' equity: | |||
Preferred stock - $5 par value, none issued | 0 | 0 | 0 |
Common stock - $0.50 par value; Shares issued and outstanding, 806 at November 2, 2018, 831 at November 3, 2017, and 830 at February 2, 2018 | 403 | 415 | 415 |
Capital in excess of par value | 0 | 22 | 0 |
Retained earnings | 5,156 | 5,425 | 5,289 |
Accumulated other comprehensive income/(loss) | (165) | 11 | 38 |
Total shareholders' equity | 5,394 | 5,873 | 5,742 |
Total liabilities and shareholders' equity | $ 36,713 | $ 35,291 | $ 36,783 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 |
Statement of Financial Position [Abstract] | |||
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 | $ 0 |
Preferred stock, shares issued | 0 | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.50 | $ 0.50 | $ 0.50 |
Common stock, shares issued | 806,000,000 | 830,000,000 | 831,000,000 |
Common stock, shares outstanding | 806,000,000 | 830,000,000 | 831,000,000 |
Consolidated Statements of Curr
Consolidated Statements of Current and Retained Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | Aug. 03, 2018 | Feb. 02, 2018 | Aug. 04, 2017 | Feb. 03, 2017 | |
Current Earnings | ||||||||
Net sales | $ 17,415 | $ 16,770 | $ 55,662 | $ 53,125 | ||||
Cost of sales | 11,755 | 11,057 | 36,791 | 34,942 | ||||
Gross margin | 5,660 | 5,713 | 18,871 | 18,183 | ||||
Expenses: | ||||||||
Selling, general and administrative | 4,270 | 3,808 | 13,147 | 11,615 | ||||
Depreciation and amortization | 433 | 358 | 1,138 | 1,080 | ||||
Operating income | 957 | 1,547 | 4,586 | 5,488 | ||||
Interest - net | 153 | 160 | 467 | 479 | ||||
Loss on extinguishment of debt | 0 | 0 | 0 | 464 | ||||
Pre-tax earnings | 804 | 1,387 | 4,119 | 4,545 | ||||
Income tax provision | 175 | 515 | 981 | 1,652 | ||||
Net earnings | $ 629 | $ 872 | $ 3,138 | $ 2,893 | ||||
Weighted-average common shares outstanding - basic (in shares) | 806 | 831 | 815 | 843 | ||||
Basic earnings per common share (in dollars per share) | $ 0.78 | $ 1.05 | $ 3.84 | $ 3.42 | ||||
Weighted-average common shares outstanding - diluted (in shares) | 807 | 832 | 816 | 844 | ||||
Diluted earnings per common share (in dollars per share) | $ 0.78 | $ 1.05 | $ 3.83 | $ 3.42 | ||||
Cash dividends per share (in dollars per share) | $ 0.48 | $ 0.41 | $ 1.37 | $ 1.17 | ||||
Retained Earnings | ||||||||
Balance at beginning of period | $ 5,517 | $ 5,253 | $ 5,425 | $ 6,241 | ||||
Cumulative effect of accounting change | $ 0 | $ 33 | $ 0 | $ 0 | ||||
Net earnings | 629 | 872 | 3,138 | 2,893 | ||||
Cash dividends declared | (387) | (341) | (1,115) | (984) | ||||
Share repurchases | (603) | (495) | (2,325) | (2,861) | ||||
Balance at end of period | $ 5,156 | $ 5,289 | $ 5,156 | $ 5,289 |
Consolidated Statements of Cu_2
Consolidated Statements of Current and Retained Earnings (Percents) (Unaudited) | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Current Earnings | ||||
Net sales | 100.00% | 100.00% | 100.00% | 100.00% |
Cost of sales | 67.50% | 65.93% | 66.10% | 65.77% |
Gross margin | 32.50% | 34.07% | 33.90% | 34.23% |
Expenses: | ||||
Selling, general and administrative | 24.51% | 22.71% | 23.62% | 21.87% |
Depreciation and amortization | 2.49% | 2.13% | 2.04% | 2.03% |
Operating income | 5.50% | 9.23% | 8.24% | 10.33% |
Interest - net | 0.88% | 0.96% | 0.84% | 0.91% |
Loss on extinguishment of debt | 0.00% | 0.00% | 0.00% | 0.87% |
Pre-tax earnings | 4.62% | 8.27% | 7.40% | 8.55% |
Income tax provision | 1.01% | 3.07% | 1.76% | 3.10% |
Net earnings | 3.61% | 5.20% | 5.64% | 5.45% |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Comprehensive Income | ||||
Net earnings | $ 629 | $ 872 | $ 3,138 | $ 2,893 |
Foreign currency translation adjustments - net of tax | (21) | 173 | (176) | 278 |
Net unrealized investment loss - net of tax | (1) | 0 | (1) | 0 |
Other comprehensive income/(loss) | (22) | 173 | (177) | 278 |
Comprehensive income | $ 607 | $ 1,045 | $ 2,961 | $ 3,171 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Percents) (Unaudited) | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Comprehensive Income | ||||
Net earnings | 3.61% | 5.20% | 5.64% | 5.45% |
Foreign currency translation adjustments - net of tax | (0.13%) | 1.03% | (0.32%) | 0.52% |
Net unrealized investment loss - net of tax | 0.00% | 0.00% | 0.00% | 0.00% |
Other comprehensive income/(loss) | (0.13%) | 1.03% | (0.32%) | 0.52% |
Comprehensive income | 3.48% | 6.23% | 5.32% | 5.97% |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 9 Months Ended | |
Nov. 02, 2018 | Nov. 03, 2017 | |
Cash flows from operating activities: | ||
Net earnings | $ 3,138 | $ 2,893 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 1,206 | 1,148 |
Deferred income taxes | (139) | (118) |
Loss on property and other assets - net | 400 | 21 |
Loss on extinguishment of debt | 0 | 464 |
(Gain) loss on cost method and equity method investments | 6 | (86) |
Share-based payment expense | 79 | 78 |
Changes in operating assets and liabilities: | ||
Merchandise inventory - net | (1,030) | (1,783) |
Other operating assets | (94) | 186 |
Accounts payable | 2,708 | 2,251 |
Other operating liabilities | 524 | 318 |
Net cash provided by operating activities | 6,798 | 5,372 |
Cash flows from investing activities: | ||
Purchases of investments | (1,298) | (680) |
Proceeds from sale/maturity of investments | 1,309 | 870 |
Capital expenditures | (846) | (787) |
Proceeds from sale of property and other long-term assets | 50 | 21 |
Acquisition of business - net | 0 | (509) |
Other - net | (3) | 13 |
Net cash used in investing activities | (788) | (1,072) |
Cash flows from financing activities: | ||
Net change in short-term borrowings | (1,137) | (340) |
Net proceeds from issuance of long-term debt | 0 | 2,968 |
Repayment of long-term debt | (288) | (2,836) |
Proceeds from issuance of common stock under share-based payment plans | 73 | 87 |
Cash dividend payments | (1,068) | (947) |
Repurchase of common stock | (2,498) | (3,054) |
Other - net | (3) | (8) |
Net cash used in financing activities | (4,921) | (4,130) |
Effect of exchange rate changes on cash | (9) | 15 |
Net increase in cash and cash equivalents | 1,080 | 185 |
Cash and cash equivalents, beginning of period | 588 | 558 |
Cash and cash equivalents, end of period | $ 1,668 | $ 743 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Nov. 02, 2018 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying consolidated financial statements (unaudited) and notes to the consolidated financial statements (unaudited) are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). During the first quarter of fiscal year 2018, the Company conformed the financial reporting calendar of a subsidiary, which did not have a significant effect on the consolidated financial statements. The consolidated financial statements (unaudited), in the opinion of management, contain all adjustments necessary to present fairly the financial position as of November 2, 2018 , and November 3, 2017 , and the results of operations and comprehensive income for the three and nine months ended November 2, 2018 , and November 3, 2017 , and cash flows for the nine months ended November 2, 2018 and November 3, 2017 . These interim consolidated financial statements (unaudited) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Lowe’s Companies, Inc. (the Company) Annual Report on Form 10-K for the fiscal year ended February 2, 2018 (the Annual Report). The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year. Accounting Pronouncements Recently Adopted Effective February 3, 2018, the Company adopted Accounting Standards Update 2014-09 (ASU 2014-09), Revenue from Contracts with Customers (Topic 606) , and all the related amendments, using the modified retrospective method. ASU 2014-09 requires a company to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Upon adoption of ASU 2014-09, the Company recorded an immaterial adjustment to the opening balance of retained earnings as of February 3, 2018, with related adjustments to other current assets, deferred revenue, accounts payable, other current liabilities, and related tax effects. The adjustment to retained earnings primarily relates to the change in revenue recognition related to gift card breakage. The adoption of the guidance also required a change in the timing of when installation services are recognized, the presentation of sales return reserve on the consolidated balance sheet, and a change in the presentation of the Company’s profit sharing income from its proprietary credit program. We applied ASU 2014-09 only to contracts that were not completed prior to fiscal 2018. Results for reporting periods beginning after February 2, 2018 are presented under ASU 2014-09, while comparative prior period amounts have not been restated and continue to be presented under accounting standards in effect in those periods. See Note 2 for additional details of the Company’s revenues. The impact of adopting the new revenue recognition guidance on our consolidated statement of earnings is as follows: Three Months Ended November 2, 2018 Consolidated Statement of Earnings (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Net sales $ 17,415 $ 17,176 $ 239 Cost of sales 11,755 11,777 (22 ) Gross margin 5,660 5,399 261 Selling, general and administrative 4,270 4,009 261 Operating income 957 957 — Pre-tax earnings 804 804 — Net earnings 629 629 — Nine Months Ended November 2, 2018 Consolidated Statement of Earnings (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Net sales $ 55,662 $ 55,150 $ 512 Cost of sales 36,791 36,849 (58 ) Gross margin 18,871 18,301 570 Selling, general and administrative 13,147 12,578 569 Operating income 4,586 4,585 1 Pre-tax earnings 4,119 4,118 1 Net earnings 3,138 3,137 1 The impacts of adopting the new revenue recognition guidance to assets and liabilities on our consolidated balance sheet are as follows: Balance at November 2, 2018 Consolidated Balance Sheet (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Assets Other current assets $ 897 $ 746 $ 151 Liabilities Accounts payable 9,283 9,272 11 Deferred revenue 1,356 1,433 (77 ) Other current liabilities 2,507 2,339 168 Accounting Pronouncements Not Yet Adopted In January 2017, the Financial Accounting Standards Board (FASB) issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350) . The ASU eliminates Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation to the identified assets and liabilities of the reporting unit to measure goodwill impairment. Under the amendments in this update, a goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The adoption of this guidance by the Company is not expected to have a material impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . The guidance in this ASU supersedes the leasing guidance in Topic 840, Leases . Under the new guidance, lessees are required to recognize lease assets and lease liabilities on the balance sheet for those leases previously classified as operating leases. In July 2018, the FASB issued ASU 2018-11, which allows a transition election to not restate comparative periods for the effects of applying the new standard. This transition election permits entities to change the date of initial application of the standard to the beginning of the year of adoption and to recognize the effects of applying Topic 842 as a cumulative-effect adjustment to the opening balance of retained earnings. Certain qualitative and quantitative disclosures are also required. The Company will adopt this ASU and related amendments on February 2, 2019. The Company also expects to elect the optional transition approach and recognize the cumulative impact of adoption in the opening balance of retained earnings to beginning fiscal year 2019. Management is implementing a new lease software to assist in complying with the ASU. The Company is currently evaluating the impact of adopting Topic 842 on its consolidated financial statements but expects the ASU to have a material impact on its consolidated balance sheet, as a result of the requirement to recognize right-of-use assets and lease liabilities for operating leases. The Company does not expect a material impact to the Company’s Consolidated Statements of Current and Retained Earnings or Consolidated Statements of Cash Flows. |
Net Sales
Net Sales | 9 Months Ended |
Nov. 02, 2018 | |
Net Sales | |
Net Sales | Net Sales - Net sales consists primarily of revenue, net of sales tax, associated with contracts with customers for the sale of goods and services in amounts that reflect consideration the Company is entitled to in exchange for those goods and services. The following table presents the Company’s sources of revenue: (In millions) Three Months Ended Nine Months Ended November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 Products $ 16,293 $ 15,903 $ 52,527 $ 50,720 Services 665 657 1,999 1,915 Other 457 210 1,136 490 Net sales $ 17,415 $ 16,770 $ 55,662 $ 53,125 Revenue from products primarily relates to in-store and online merchandise purchases, which are recognized at the point in time when the customer obtains control of the merchandise, which is at the time of in-store purchase or delivery of the product to the customer. A provision for anticipated merchandise returns is provided through a reduction of sales and cost of sales in the period that the related sales are recorded. Under ASU 2014-09, the merchandise return reserve is presented on a gross basis, with a separate asset and liability included in the consolidated balance sheets as of reporting periods after February 2, 2018 . Reporting periods prior to the adoption of ASU 2014-09 reflect merchandise return reserves on a net basis. As of November 2, 2018 , anticipated sales returns of $229 million are reflected in other current liabilities, and the associated right of return assets of $151 million are reflected in other current assets. As of November 3, 2017 , the merchandise return reserve, net of the associated asset, was $85 million reflected in other current liabilities. Revenues from services primarily relate to professional installation services the Company provides through subcontractors related to merchandise purchased by a customer. In certain instances, installation services include materials provided by the subcontractor, and both product and installation are included in service revenue. The Company recognizes revenue associated with services as they are rendered, and the majority of services are completed within one week from initiation. Deferred revenue is presented for merchandise that has not yet transferred control to the customer and for services that have not yet been provided, but for which tender has been accepted. Deferred revenue is recognized in sales either at a point in time when the customer obtains control of merchandise through pickup or delivery, or over time as services are provided to the customer. Deferred revenues associated with amounts received for which customers have not taken possession of the merchandise or for which installation has not yet been completed were $945 million at November 2, 2018 and $952 million at November 3, 2017 . The majority of revenue for goods and services is recognized in the quarter following revenue deferral. Stored-value cards In addition, the Company defers revenues from stored-value cards, which include gift cards and returned merchandise credits, and recognizes revenue into sales when the cards are redeemed. The liability associated with outstanding stored-value cards was $411 million and $452 million at November 2, 2018 , and November 3, 2017 , respectively, and these amounts are included in deferred revenue on the consolidated balance sheets. Upon adoption of ASU 2014-09, the Company recognizes income from unredeemed stored-value cards in proportion to the pattern of rights exercised by the customer. Amounts recognized as breakage were insignificant for the three and nine months ended November 2, 2018 and November 3, 2017 . Extended protection plans The Company also defers revenues for its separately-priced extended protection plan contracts, which is a Lowe’s-branded program for which the Company is ultimately self-insured. The Company recognizes revenue from extended protection plan sales on a straight-line basis over the respective contract term. Extended protection plan contract terms primarily range from one to five years from the date of purchase or the end of the manufacturer’s warranty, as applicable. Deferred revenue from extended protection plans recognized into sales were $97 million and $293 million for the three and nine months ended November 2, 2018 , respectively, and $92 million and $273 million for the three and nine months ended November 3, 2017 , respectively. Incremental direct acquisition costs associated with the sale of extended protection plans are also deferred and recognized as expense on a straight-line basis over the respective contract term and were insignificant at November 2, 2018 and November 3, 2017 , respectively. The Company’s extended protection plan deferred costs are included in other assets (noncurrent) on the consolidated balance sheets. All other costs, such as costs of services performed under the contract, general and administrative expenses, and advertising expenses are expensed as incurred. The liability for extended protection plan claims incurred is included in other current liabilities on the consolidated balance sheets and was not material in any of the periods presented. Expenses for claims are recognized when incurred and totaled $47 million and $141 million for the three and nine months ended November 2, 2018 , respectively, and $43 million and $119 million for the three and nine months ended November 3, 2017 , respectively. Disaggregation of Revenues The following table presents the Company’s net sales disaggregated by merchandise division: Three Months Ended Nine Months Ended November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 (In millions) Total Sales % Total Sales % Total Sales % Total Sales % Building & Maintenance ¹ $ 7,322 42 $ 7,202 43 $ 22,042 40 $ 21,069 40 Home Décor ² 6,959 40 6,874 41 21,207 37 20,688 39 Seasonal ³ 2,570 15 2,382 15 10,964 20 10,573 20 Other 564 3 312 1 1,449 3 795 1 Total $ 17,415 100 $ 16,770 100 $ 55,662 100 $ 53,125 100 1 Building & Maintenance includes the following product categories: Lumber & Building Materials, Millwork, Rough Plumbing & Electrical, and Tools & Hardware 2 Home Décor includes the following product categories: Appliances, Fashion Fixtures, Flooring, Kitchens, and Paint 3 Seasonal includes the following product categories: Lawn & Garden and Seasonal & Outdoor Living The following table presents the Company’s net sales disaggregated by geographical area: (In millions) Three Months Ended Nine Months Ended November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 United States $ 15,991 $ 15,279 $ 51,319 $ 49,102 International 1,424 1,491 4,343 4,023 Net Sales $ 17,415 $ 16,770 $ 55,662 $ 53,125 Practical Expedients Sales commissions and selling-related goods or services are considered immaterial and are expensed as incurred because the amortization period of the assets would be one year or less. These costs are reflected within selling, general and administrative expenses. |
Acquisitions
Acquisitions | 9 Months Ended |
Nov. 02, 2018 | |
Acquisitions | |
Acquisitions | Acquisitions - On June 23, 2017, the Company completed its acquisition of Maintenance Supply Headquarters, a leading distributor of maintenance, repair and operations (MRO) products serving the multifamily housing industry. The acquisition is expected to enable the Company to deepen and broaden its relationship with Pro customers and better serve their needs. The aggregate cash purchase price of this acquisition was $513 million and is included in the investing section of the consolidated statements of cash flows, net of cash acquired. Acquisition-related costs were expensed as incurred and were not significant. The following table summarizes the aggregate purchase price allocation: (In millions) June 23, 2017 Allocation: Cash acquired $ 4 Merchandise inventory 68 Other current assets 36 Property 12 Goodwill 160 Other assets 260 Accounts payable (18 ) Other current liabilities (9 ) Net assets acquired $ 513 Intangible assets acquired totaled $259 million , and include a trademark of $34 million with a useful life of 15 years and a customer list of $225 million with a useful life of 20 years, each of which are included in other assets in the accompanying consolidated balance sheets. The goodwill of $160 million is primarily attributable to the synergies expected to arise after the acquisition and is deductible for tax purposes. Pro forma and historical financial information has not been provided as the acquisition was not material to the consolidated financial statements. |
Investment in Australian Joint
Investment in Australian Joint Venture | 9 Months Ended |
Nov. 02, 2018 | |
Investment in Australian Joint Venture | |
Investment in Australian Joint Venture | Investment in Australian Joint Venture - During the second quarter of fiscal 2017, the Company completed the sale of our interest in the Australian joint venture with Woolworths Limited and received proceeds of $199 million , which is included in cash flows from investing activities in the accompanying consolidated statements of cash flows. The proceeds from the sale exceeded the carrying value of the investment and resulted in a gain of $96 million . The carrying value prior to the sale reflected the non-cash impairment charges taken in fiscal years 2015 and 2016. The gain is included in selling, general and administrative expense in the accompanying consolidated statements of current and retained earnings. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Nov. 02, 2018 | |
Fair Value Measurements | |
Fair Value Measurements | Fair Value Measurements - Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance for fair value measurements establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows: • Level 1 - inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities • Level 2 - inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly • Level 3 - inputs to the valuation techniques that are unobservable for the assets or liabilities Assets and Liabilities that are Measured at Fair Value on a Recurring Basis The following table presents the Company’s financial assets measured at fair value on a recurring basis as of November 2, 2018 , November 3, 2017 , and February 2, 2018 . The fair values of these instruments approximated amortized costs. Fair Value Measurements at (In millions) Measurement Level November 2, 2018 November 3, 2017 February 2, 2018 Short-term investments: Available-for-sale securities Money market funds Level 1 $ 181 $ 70 $ 86 Certificates of deposit Level 1 17 15 16 Agency securities Level 2 10 — — Total short-term investments $ 208 $ 85 $ 102 Long-term investments: Available-for-sale securities Corporate debt securities Level 2 $ 224 $ — $ — Agency securities Level 2 66 — — Municipal floating rate obligations Level 2 — 368 407 Certificates of deposit Level 1 — 2 1 Total long-term investments $ 290 $ 370 $ 408 There were no transfers between Levels 1, 2 or 3 during any of the periods presented. When available, quoted prices were used to determine fair value. When quoted prices in active markets were available, investments were classified within Level 1 of the fair value hierarchy. When quoted prices in active markets were not available, fair values were determined using pricing models, and the inputs to those pricing models were based on observable market inputs. The inputs to the pricing models were typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others. Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis During the three and nine months ended November 2, 2018 , the Company’s only significant assets or liabilities measured at fair value on a nonrecurring basis subsequent to their initial recognition were certain long-lived assets. During the three and nine months ended November 3, 2017 , the Company had no significant measurements of assets and liabilities at fair value on a nonrecurring basis subsequent to their initial recognition. The Company reviews the carrying amounts of long-lived assets whenever certain events or changes in circumstances indicate that the carrying amounts may not be recoverable. With input from executive management and retail store operations, the Company’s accounting and finance personnel that organizationally report to the chief financial officer assess the performance of retail stores quarterly against historical patterns, projections of future profitability and whether it is more likely than not the assets will be disposed of significantly prior to the end of their estimated useful life for evidence of possible impairment. An impairment loss is recognized when the carrying amount of the asset (disposal) group is not recoverable and exceeds its fair value. The Company estimated the fair values of assets subject to long-lived asset impairment based on the Company’s own judgments about the assumptions that market participants would use in pricing the assets and on observable market data, when available. The Company classified these fair value measurements as Level 3. In the determination of impairment for operating locations, the Company determined the fair values of individual operating locations using an income approach, which required discounting projected future cash flows. When determining the stream of projected future cash flows associated with an individual operating location, management made assumptions, including highest and best use, incorporating local market conditions and inputs from retail store operations where necessary, and about key variables including the following unobservable inputs: sales growth rates, gross margin, controllable and uncontrollable expenses, and asset residual values. In order to calculate the present value of those future cash flows, the Company discounted cash flow estimates at a rate commensurate with the risk that selected market participants would assign to the cash flows. In general, the selected market participants represented a group of other retailers with a location footprint similar in size to the Company’s. As part of a strategic reassessment of Orchard Supply Hardware (Orchard), during the three months ended August 3, 2018, it was determined to be more likely than not the assets of Orchard would be sold or otherwise disposed of significantly before the end of their previously estimated useful lives, and therefore, these assets experienced a triggering event and were evaluated for recoverability. Operating locations evaluated for recoverability included all Orchard stores, as well as a distribution facility that services the Orchard stores and a corporate facility. Based on this evaluation of Orchard, certain long-lived assets, including tangible and intangible assets, were written down to their fair value of $284 million resulting in impairment charges of $206 million. These non-cash impairment charges are included in selling, general and administrative expense in the accompanying consolidated statements of current and retained earnings. During the three months ended November 2, 2018, the company committed to closing 20 U.S. home improvement stores and 31 locations in Canada, including 27 stores, as well as exiting certain immaterial non-core activities within its U.S. home improvement business. As a result of these decisions, the related assets experienced a triggering event and were evaluated for recoverability. Based on this evaluation, certain long-lived assets were written down to their fair value of $81 million resulting in impairment charges of $99 million, with $90 million associated with the location closures and $9 million associated with the exit of non-core activities. These non-cash impairment charges are included in selling, general and administrative expense in the accompanying consolidated statements of current and retained earnings. In addition, as part of the Company’s strategic reassessment process, during the three months ended November 2, 2018 , it was determined to be more likely than not the assets of the Mexico retail operations would be sold or otherwise disposed of significantly before the end of their previously estimated useful lives, and therefore, these assets experienced a triggering event and were evaluated for recoverability. Operating locations evaluated for recoverability included all 13 stores in Mexico, as well as a corporate facility. Based on this evaluation of the Mexico retail operations, certain long-lived assets were written down to their fair value of $107 million resulting in impairment charges of $22 million . These non-cash impairment charges are included in selling, general and administrative expense in the accompanying consolidated statements of current and retained earnings. See Note 8 for additional information regarding the Company’s decisions to exit its Orchard operations and certain U.S. and Canada locations during the third quarter as part of the Company’s ongoing strategic reassessment of the business. The following table presents the Company’s non-financial assets measured at estimated fair value on a nonrecurring basis and the resulting long-lived asset impairment losses included in earnings. 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 November 2, 2018 . Fair Value Measurements Impairment Losses (In millions) November 2, 2018 Three Months Ended November 2, 2018 Nine Months Ended November 2, 2018 Assets-held-for-use: Operating locations $ 473 $ (112 ) $ (329 ) Total $ 473 $ (112 ) $ (329 ) Fair Value of Financial Instruments The Company’s financial instruments not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, short-term borrowings, accounts payable, accrued liabilities and long-term debt and are reflected in the financial statements at cost. With the exception of long-term debt, cost approximates fair value for these items due to their short-term nature. The fair values of the Company’s unsecured notes were estimated using quoted market prices. The fair values of the Company’s mortgage notes were estimated using discounted cash flow analyses, based on the future cash outflows associated with these arrangements and discounted using the applicable incremental borrowing rate. Carrying amounts and the related estimated fair value of the Company’s long-term debt, excluding capitalized lease obligations, are as follows: November 2, 2018 November 3, 2017 February 2, 2018 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Unsecured notes (Level 1) $ 14,718 $ 14,430 $ 14,958 $ 15,974 $ 14,961 $ 15,608 Mortgage notes (Level 2) 6 6 7 7 6 7 Long-term debt (excluding capitalized lease obligations) $ 14,724 $ 14,436 $ 14,965 $ 15,981 $ 14,967 $ 15,615 |
Restricted Investment Balances
Restricted Investment Balances | 9 Months Ended |
Nov. 02, 2018 | |
Restricted Investment Balances | |
Restricted Investment Balances | Restricted Investment Balances - Short-term and long-term investments include restricted balances pledged as collateral primarily for the Company’s extended protection plan program. Restricted balances included in short-term investments were $191 million at November 2, 2018 , $70 million at November 3, 2017 , and $86 million at February 2, 2018 . Restricted balances included in long-term investments were $255 million at November 2, 2018 , $332 million at November 3, 2017 , and $381 million at February 2, 2018 . |
Property
Property | 9 Months Ended |
Nov. 02, 2018 | |
Property | |
Property | Property - Property is shown net of accumulated depreciation of $17.7 billion at November 2, 2018 , $17.1 billion at November 3, 2017 , and $17.2 billion at February 2, 2018 . |
Exit Activities
Exit Activities | 9 Months Ended |
Nov. 02, 2018 | |
Exit Activities | |
Exit Activities | Exit Activities - During the second quarter of fiscal year 2018, the Company initiated a strategic reassessment of its business to drive increased focus on its core home improvement operations. As a result of this reassessment, the Company has decided to exit certain activities and close certain locations as further described below. Orchard Supply Hardware (Orchard) On August 17, 2018, the Company approved plans to exit its Orchard operations by closing all 99 Orchard stores, which are located in California, Oregon and Florida, as well as the distribution facility that services the Orchard stores, and the Orchard corporate office. To facilitate an orderly wind-down, the Company has partnered with Hilco Merchant Services to help manage the store closing sales process and provide a seamless experience for customers. All stores are expected to be closed before the end of the Company’s 2018 fiscal year (February 1, 2019). During the second quarter ended August 3, 2018, the Company recorded $230 million of pre-tax charges associated with its Orchard operations. This included $206 million of impairment of certain long-lived assets, including tangible and intangible assets, due to the determination it was more likely than not the assets of Orchard would be sold or otherwise disposed of significantly before the end of their previously estimated useful lives (see Note 5 to the consolidated financial statements) and $24 million related primarily to three store projects that were discontinued during the quarter. During the third quarter ended November 2, 2018, the Company recorded $123 million of pre-tax charges related to the exit of its Orchard operations, including accelerated depreciation and amortization of $103 million, severance costs of $11 million, and costs associated with lease obligations of $9 million. The Company expects additional pre-tax charges associated with the exit of Orchard during the fourth quarter of fiscal 2018, of $270 to $350 million, primarily associated with lease obligation costs. Other Store Closings and Exit of Certain Non-Core Activities On October 31, 2018, the Company committed to closing 20 U.S. home improvement stores and 31 locations in Canada, including 27 stores. The store closings are estimated to be completed by the end of fiscal 2018. In addition, the Company concurrently decided to no longer pursue a new store project that was in process. As a result of these decisions, during the third quarter ended November 2, 2018, the Company recorded $121 million of pre-tax charges, including $90 million of impairment of certain long-lived assets (see Note 5 to the consolidated financial statements), severance costs of $21 million, and discontinued project costs of $10 million. The Company expects additional pre-tax charges associated with these closings during the fourth quarter of fiscal 2018, of $190 to $230 million, primarily associated with lease obligation costs and accelerated depreciation. In addition, during the third quarter ended November 2, 2018, the Company decided to pursue an exit of certain immaterial non-core activities within its U.S. home improvement business. As a result of these decisions, during the third quarter ended November 2, 2018, the Company recorded $14 million of pre-tax charges, including long-lived asset impairments of $9 million (see Note 5 to the consolidated financial statements), and the write-down of inventory to net realizable value of $5 million. Mexico Retail Operations On November 9, 2018, subsequent to the end of the Company’s third quarter of fiscal 2018, management and the board of directors decided to pursue an exit of the Company’s Mexico retail operations consisting of 13 stores, and the Company is exploring exit alternatives. During the third quarter ended November 2, 2018, the Company recorded $22 million of pre-tax charges associated with long-lived asset impairment due to the determination it was more likely than not the assets of the Mexico retail operations would be sold or otherwise disposed of significantly before the end of their previously estimated useful lives (see Note 5 to the consolidated financial statements). The amounts, nature and timing of any additional charges associated with the intended exit of the Mexico retail operations will depend on the plan executed and cannot be reasonably estimated. A summary of the significant components of charges associated with the exit activities discussed above, are as follows: Costs Incurred Three Months Ended Nine Months Ended (In millions) November 2, 2018 November 2, 2018 Long-lived asset impairments $ 121 $ 327 Accelerated depreciation and amortization 103 103 Severance costs 32 32 Discontinued project write-offs 10 34 Lease obligation costs for closed locations 9 9 Inventory adjustments to net realizable value 5 5 Total $ 280 $ 510 All estimated amounts are subject to change until finalized. Expenses associated with long-lived asset impairment, discontinued projects, severance, and lease obligations, are included in selling, general and administrative expense in the consolidated statement of current and retained earnings. Inventory adjustments to net realizable value are included in cost of sales in the consolidated statement of current and retained earnings. |
Short-Term Borrowings
Short-Term Borrowings | 9 Months Ended |
Nov. 02, 2018 | |
Short-Term Borrowings | |
Short-Term Borrowings | Short-Term Borrowings - In September 2018, the Company entered into a $1.75 billion five year unsecured revolving second amended and restated credit agreement (the Second Amended and Restated Credit Agreement) with a syndicate of banks. The Second Amended and Restated Credit Agreement amends and restates the Company’s amended and restated credit agreement, dated November 23, 2016 (the Amended and Restated Credit Agreement), to among other things (i) extend the maturity date of the revolving credit facility to September 2023 and (ii) modify the revolving commitments of the existing lenders. The Company may request borrowings under the Second Amended and Restated Credit Agreement that are denominated in U.S. Dollar, Euro, Sterling, Canadian Dollar and other currencies approved by the administrative agent and the lenders. Borrowings under the Second Amended and Restated Credit Agreement will bear interest calculated according to a Base Rate or a Eurocurrency Rate, plus an applicable margin. Subject to obtaining commitments from the lenders and satisfying other conditions specified in the Second Amended and Restated Credit Agreement, the Company may increase the aggregate availability by an additional $500 million . The Second Amended and Restated Credit Agreement contains customary representations, warranties, and covenants for a transaction of this type. The Company was in compliance with those covenants at November 2, 2018 . In September 2018, the Company entered into a $250 million unsecured 364-day credit agreement (the 364-Day Credit Agreement) with a syndicate of banks. The Company may request borrowings under the 364-Day Credit Agreement that are denominated in U.S. Dollar, Euro, Sterling, Canadian Dollar and other currencies approved by the administrative agent and the lenders. The Company must repay the aggregate principal amount of loans outstanding under the 364-Day Credit Agreement on the termination date in effect at such time (currently September 9, 2019). The Company may elect to convert all of the loans outstanding under the 364-Day Credit Agreement on the termination date into a term loan which the Company shall repay in full on the first anniversary date of the termination date. Borrowings under the 364-Day Credit Agreement will bear interest calculated according to a Base Rate or a Eurocurrency Rate plus an applicable margin. The 364-Day Credit Agreement contains customary representations, warranties and covenants for a transaction of this type. The Company was in compliance with those covenants at November 2, 2018 . The Second Amended and Restated Credit Agreement and the 364-Day Credit Agreement both support our commercial paper program. The amount available to be drawn under the Second Amended and Restated Credit Agreement and the 364-Day Credit Agreement is reduced by the amount of borrowings under our commercial paper program. There were no outstanding borrowings under the Second Amended and Restated Credit Agreement, the 364-Day Credit Agreement, or our commercial paper program as of November 2, 2018 . As of November 3, 2017 , there were $171 million of outstanding borrowings under the commercial paper program with a weighted average interest rate of 1.37% and no outstanding borrowings or letters of credit under the Amended and Restated Credit Agreement. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Nov. 02, 2018 | |
Shareholders' Equity | |
Shareholders' Equity | Shareholders’ Equity - The Company has a share repurchase program that is executed through purchases made from time to time either in the open market, which may be made under pre-set trading plans meeting the requirements of Rule 10b5-1(c) of the Securities Exchange Act of 1934, or through private off-market transactions. Shares purchased under the repurchase program are retired and returned to authorized and unissued status. On January 26, 2018, the Company’s Board of Directors authorized a $5.0 billion share repurchase program with no expiration, which was announced on the same day. As of November 2, 2018 , the Company had $4.5 billion remaining in its share repurchase program. In May 2018, the Company entered into an Accelerated Share Repurchase (ASR) agreement with a third-party financial institution to repurchase $550 million of the Company’s common stock. At inception, pursuant to the agreement, the Company paid $550 million to the financial institution using cash on hand, and took delivery of 4.8 million shares. The Company finalized the transaction and received an additional 0.8 million shares prior to the end of the second quarter. In August 2018, the Company entered into an ASR agreement with a third-party financial institution to repurchase $310 million of the Company’s common stock. At inception, pursuant to the agreement, the Company paid $310 million to the financial institution using cash on hand, and took delivery of 2.5 million shares. The Company finalized the transaction and received an additional 0.3 million shares prior to the end of the third quarter. Under the terms of the ASR agreements, upon settlement, the Company would either receive additional shares from the applicable financial institution or be required to deliver additional shares or cash to such financial institution. The Company controlled its election to either deliver additional shares or cash to the financial institution and was subject to provisions which limited the number of shares the Company would be required to deliver. The final number of shares received upon settlement of each of the ASR agreements was determined with reference to the volume-weighted average price of the Company’s common stock over the term of the applicable ASR agreement. The initial repurchase of shares under the agreement resulted in an immediate reduction of the outstanding shares used to calculate the weighted-average common shares outstanding for basic and diluted earnings per share. The ASR agreements were accounted for as a treasury stock transaction and forward stock purchase contract. The par value of the shares received was recorded as a reduction to common stock with the remainder recorded as a reduction to capital in excess of par value and retained earnings. The forward stock purchase contract was considered indexed to the Company’s own stock and was classified as an equity instrument. During the three and nine months ended November 2, 2018 , the Company repurchased shares of its common stock through the open market totaling 2.9 million and 17.5 million shares, respectively, for a cost of $310 million and $1.6 billion , respectively. The Company also withholds shares from employees to satisfy either the exercise price of stock options exercised or the statutory withholding tax liability resulting from the vesting of share-based awards. Shares repurchased for the three and nine months ended November 2, 2018 and November 3, 2017 were as follows: Three Months Ended November 2, 2018 November 3, 2017 (In millions) Shares Cost 1 Shares Cost 1 Share repurchase program 5.7 $ 620 6.4 $ 500 Shares withheld from employees 0.2 25 0.4 27 Total share repurchases 5.9 $ 645 6.8 $ 527 1 Reductions of $603 million and $495 million were recorded to retained earnings, after capital in excess of par value was depleted, for the three months ended November 2, 2018 and November 3, 2017 , respectively. Nine Months Ended November 2, 2018 November 3, 2017 (In millions) Shares Cost 2 Shares Cost 2 Share repurchase program 25.9 $ 2,470 37.5 $ 3,000 Shares withheld from employees 0.3 38 0.5 41 Total share repurchases 26.2 $ 2,508 38.0 $ 3,041 2 Reductions of $2.3 billion and $2.9 billion were recorded to retained earnings, after capital in excess of par value was depleted, for the nine months ended November 2, 2018 and November 3, 2017 , respectively. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Nov. 02, 2018 | |
Earnings Per Share | |
Earnings Per Share | Earnings Per Share - The Company calculates basic and diluted earnings per common share using the two-class method. Under the two-class method, net earnings are allocated to each class of common stock and participating security as if all of the net earnings for the period had been distributed. The Company’s participating securities consist of share-based payment awards that contain a non-forfeitable right to receive dividends and, therefore, are considered to participate in undistributed earnings with common shareholders. Basic earnings per common share excludes dilution and is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is calculated by dividing net earnings allocable to common shares by the weighted-average number of common shares as of the balance sheet date, as adjusted for the potential dilutive effect of non-participating share-based awards. The following table reconciles earnings per common share for the three and nine months ended November 2, 2018 and November 3, 2017 : Three Months Ended Nine Months Ended (In millions, except per share data) November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 Basic earnings per common share: Net earnings $ 629 $ 872 $ 3,138 $ 2,893 Less: Net earnings allocable to participating securities (1 ) (2 ) (10 ) (10 ) Net earnings allocable to common shares, basic 628 $ 870 $ 3,128 $ 2,883 Weighted-average common shares outstanding 806 831 815 843 Basic earnings per common share $ 0.78 $ 1.05 $ 3.84 $ 3.42 Diluted earnings per common share: Net earnings $ 629 $ 872 $ 3,138 $ 2,893 Less: Net earnings allocable to participating securities (1 ) (2 ) (10 ) (10 ) Net earnings allocable to common shares, diluted $ 628 $ 870 $ 3,128 $ 2,883 Weighted-average common shares outstanding 806 831 815 843 Dilutive effect of non-participating share-based awards 1 1 1 1 Weighted-average common shares, as adjusted 807 832 816 844 Diluted earnings per common share $ 0.78 $ 1.05 $ 3.83 $ 3.42 Stock options to purchase 0.2 million and 0.4 million shares of common stock were anti-dilutive for the three and nine months ended November 2, 2018 , respectively. Stock options to purchase 1.0 million shares of common stock were anti-dilutive for the three and nine months ended November 3, 2017 , respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Nov. 02, 2018 | |
Income Taxes | |
Income Taxes | Income Taxes - The Company’s effective income tax rates were 21.8% and 23.8% for the three and nine months ended November 2, 2018 , respectively, and 37.1% and 36.3% for the three and nine months ended November 3, 2017 , respectively. The lower effective income tax rate for the three and nine months ended November 2, 2018 was primarily due to the enactment of the Tax Cuts and Jobs Act (Tax Act) during fiscal 2017, which lowered the corporate federal income tax rate from 35% to 21%. Based on the Company’s interpretation of the Tax Act, the Company made reasonable estimates to record provisional adjustments during the fourth quarter of fiscal 2017. However, the final impact may differ due to subsequent legislative action, changes in interpretations and assumptions, as well as the issuance of additional guidance from the Internal Revenue Service and state taxing authorities. We have not made any measurement-period adjustments related to these items during the nine months ended November 2, 2018 , because we have not finalized the following items: the earnings and profits of the relevant subsidiaries, deemed repatriation of deferred foreign income, and prior year deferred tax activity. The Company will continue to evaluate the Tax Act and gather additional information within the measurement period allowed, which will be completed no later than the fourth quarter of fiscal 2018. |
Supplemental Disclosure
Supplemental Disclosure | 9 Months Ended |
Nov. 02, 2018 | |
Supplemental Disclosure | |
Supplemental Disclosure | Supplemental Disclosure Net interest expense is comprised of the following: Three Months Ended Nine Months Ended (In millions) November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 Long-term debt $ 145 $ 146 $ 437 $ 438 Capitalized lease obligations 15 14 44 41 Interest income (9 ) (2 ) (21 ) (10 ) Interest capitalized — (2 ) (2 ) (4 ) Interest on tax uncertainties — — — (1 ) Other 2 4 9 15 Interest - net $ 153 $ 160 $ 467 $ 479 Supplemental disclosures of cash flow information: Nine Months Ended (In millions) November 2, 2018 November 3, 2017 Cash paid for interest, net of amount capitalized $ 555 $ 610 Cash paid for income taxes - net $ 1,069 $ 1,322 Non-cash investing and financing activities: Non-cash property acquisitions, including assets acquired under capital lease $ 42 $ 91 Cash dividends declared but not paid $ 387 $ 341 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Nov. 02, 2018 | |
Subsequent Events | |
Subsequent Events | Subsequent Events - As part of a strategic reassessment, on November 9, 2018, subsequent to the end of the Company’s third quarter of fiscal 2018, management and the board of directors decided to pursue an exit of the Company’s Mexico retail operations consisting of 13 stores, and the Company is exploring exit alternatives. The amounts, nature and timing of any future charges associated with the intended exit of the Mexico retail operations will depend on the plan executed and cannot be reasonably estimated. As of November 2, 2018, the total net book value of the Company’s Mexico retail operation is $294 million , including a cumulative translation adjustment of $100 million . |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Nov. 02, 2018 | |
Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation The accompanying consolidated financial statements (unaudited) and notes to the consolidated financial statements (unaudited) are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). During the first quarter of fiscal year 2018, the Company conformed the financial reporting calendar of a subsidiary, which did not have a significant effect on the consolidated financial statements. The consolidated financial statements (unaudited), in the opinion of management, contain all adjustments necessary to present fairly the financial position as of November 2, 2018 , and November 3, 2017 , and the results of operations and comprehensive income for the three and nine months ended November 2, 2018 , and November 3, 2017 , and cash flows for the nine months ended November 2, 2018 and November 3, 2017 . These interim consolidated financial statements (unaudited) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Lowe’s Companies, Inc. (the Company) Annual Report on Form 10-K for the fiscal year ended February 2, 2018 (the Annual Report). The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year. |
Recent Accounting Pronouncements | Accounting Pronouncements Recently Adopted Effective February 3, 2018, the Company adopted Accounting Standards Update 2014-09 (ASU 2014-09), Revenue from Contracts with Customers (Topic 606) , and all the related amendments, using the modified retrospective method. ASU 2014-09 requires a company to recognize revenue to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Upon adoption of ASU 2014-09, the Company recorded an immaterial adjustment to the opening balance of retained earnings as of February 3, 2018, with related adjustments to other current assets, deferred revenue, accounts payable, other current liabilities, and related tax effects. The adjustment to retained earnings primarily relates to the change in revenue recognition related to gift card breakage. The adoption of the guidance also required a change in the timing of when installation services are recognized, the presentation of sales return reserve on the consolidated balance sheet, and a change in the presentation of the Company’s profit sharing income from its proprietary credit program. We applied ASU 2014-09 only to contracts that were not completed prior to fiscal 2018. Results for reporting periods beginning after February 2, 2018 are presented under ASU 2014-09, while comparative prior period amounts have not been restated and continue to be presented under accounting standards in effect in those periods. See Note 2 for additional details of the Company’s revenues. The impact of adopting the new revenue recognition guidance on our consolidated statement of earnings is as follows: Three Months Ended November 2, 2018 Consolidated Statement of Earnings (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Net sales $ 17,415 $ 17,176 $ 239 Cost of sales 11,755 11,777 (22 ) Gross margin 5,660 5,399 261 Selling, general and administrative 4,270 4,009 261 Operating income 957 957 — Pre-tax earnings 804 804 — Net earnings 629 629 — Nine Months Ended November 2, 2018 Consolidated Statement of Earnings (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Net sales $ 55,662 $ 55,150 $ 512 Cost of sales 36,791 36,849 (58 ) Gross margin 18,871 18,301 570 Selling, general and administrative 13,147 12,578 569 Operating income 4,586 4,585 1 Pre-tax earnings 4,119 4,118 1 Net earnings 3,138 3,137 1 The impacts of adopting the new revenue recognition guidance to assets and liabilities on our consolidated balance sheet are as follows: Balance at November 2, 2018 Consolidated Balance Sheet (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Assets Other current assets $ 897 $ 746 $ 151 Liabilities Accounts payable 9,283 9,272 11 Deferred revenue 1,356 1,433 (77 ) Other current liabilities 2,507 2,339 168 Accounting Pronouncements Not Yet Adopted In January 2017, the Financial Accounting Standards Board (FASB) issued ASU 2017-04, Intangibles-Goodwill and Other (Topic 350) . The ASU eliminates Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation to the identified assets and liabilities of the reporting unit to measure goodwill impairment. Under the amendments in this update, a goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount. An impairment charge is recognized for the amount by which the carrying amount exceeds the reporting unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. This ASU is effective for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The adoption of this guidance by the Company is not expected to have a material impact on its consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) . The guidance in this ASU supersedes the leasing guidance in Topic 840, Leases . Under the new guidance, lessees are required to recognize lease assets and lease liabilities on the balance sheet for those leases previously classified as operating leases. In July 2018, the FASB issued ASU 2018-11, which allows a transition election to not restate comparative periods for the effects of applying the new standard. This transition election permits entities to change the date of initial application of the standard to the beginning of the year of adoption and to recognize the effects of applying Topic 842 as a cumulative-effect adjustment to the opening balance of retained earnings. Certain qualitative and quantitative disclosures are also required. The Company will adopt this ASU and related amendments on February 2, 2019. The Company also expects to elect the optional transition approach and recognize the cumulative impact of adoption in the opening balance of retained earnings to beginning fiscal year 2019. Management is implementing a new lease software to assist in complying with the ASU. The Company is currently evaluating the impact of adopting Topic 842 on its consolidated financial statements but expects the ASU to have a material impact on its consolidated balance sheet, as a result of the requirement to recognize right-of-use assets and lease liabilities for operating leases. The Company does not expect a material impact to the Company’s Consolidated Statements of Current and Retained Earnings or Consolidated Statements of Cash Flows. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Summary of Significant Accounting Policies | |
Schedule of new accounting pronouncements and changes in accounting principles | The impact of adopting the new revenue recognition guidance on our consolidated statement of earnings is as follows: Three Months Ended November 2, 2018 Consolidated Statement of Earnings (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Net sales $ 17,415 $ 17,176 $ 239 Cost of sales 11,755 11,777 (22 ) Gross margin 5,660 5,399 261 Selling, general and administrative 4,270 4,009 261 Operating income 957 957 — Pre-tax earnings 804 804 — Net earnings 629 629 — Nine Months Ended November 2, 2018 Consolidated Statement of Earnings (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Net sales $ 55,662 $ 55,150 $ 512 Cost of sales 36,791 36,849 (58 ) Gross margin 18,871 18,301 570 Selling, general and administrative 13,147 12,578 569 Operating income 4,586 4,585 1 Pre-tax earnings 4,119 4,118 1 Net earnings 3,138 3,137 1 The impacts of adopting the new revenue recognition guidance to assets and liabilities on our consolidated balance sheet are as follows: Balance at November 2, 2018 Consolidated Balance Sheet (in millions) As Reported Under Historical Guidance Impact of Adopting ASU 2014-09 Assets Other current assets $ 897 $ 746 $ 151 Liabilities Accounts payable 9,283 9,272 11 Deferred revenue 1,356 1,433 (77 ) Other current liabilities 2,507 2,339 168 |
Net Sales (Tables)
Net Sales (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Net Sales | |
Sources of revenue | The following table presents the Company’s sources of revenue: (In millions) Three Months Ended Nine Months Ended November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 Products $ 16,293 $ 15,903 $ 52,527 $ 50,720 Services 665 657 1,999 1,915 Other 457 210 1,136 490 Net sales $ 17,415 $ 16,770 $ 55,662 $ 53,125 |
Revenue from external customers by merchandise division | The following table presents the Company’s net sales disaggregated by merchandise division: Three Months Ended Nine Months Ended November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 (In millions) Total Sales % Total Sales % Total Sales % Total Sales % Building & Maintenance ¹ $ 7,322 42 $ 7,202 43 $ 22,042 40 $ 21,069 40 Home Décor ² 6,959 40 6,874 41 21,207 37 20,688 39 Seasonal ³ 2,570 15 2,382 15 10,964 20 10,573 20 Other 564 3 312 1 1,449 3 795 1 Total $ 17,415 100 $ 16,770 100 $ 55,662 100 $ 53,125 100 1 Building & Maintenance includes the following product categories: Lumber & Building Materials, Millwork, Rough Plumbing & Electrical, and Tools & Hardware 2 Home Décor includes the following product categories: Appliances, Fashion Fixtures, Flooring, Kitchens, and Paint 3 Seasonal includes the following product categories: Lawn & Garden and Seasonal & Outdoor Living |
Revenue from external customers by geographic areas | The following table presents the Company’s net sales disaggregated by geographical area: (In millions) Three Months Ended Nine Months Ended November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 United States $ 15,991 $ 15,279 $ 51,319 $ 49,102 International 1,424 1,491 4,343 4,023 Net Sales $ 17,415 $ 16,770 $ 55,662 $ 53,125 |
Acquisitions (Tables)
Acquisitions (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Acquisitions | |
Acquisitions | The following table summarizes the aggregate purchase price allocation: (In millions) June 23, 2017 Allocation: Cash acquired $ 4 Merchandise inventory 68 Other current assets 36 Property 12 Goodwill 160 Other assets 260 Accounts payable (18 ) Other current liabilities (9 ) Net assets acquired $ 513 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Fair Value Measurements | |
Fair value measurements - recurring basis | The following table presents the Company’s financial assets measured at fair value on a recurring basis as of November 2, 2018 , November 3, 2017 , and February 2, 2018 . The fair values of these instruments approximated amortized costs. Fair Value Measurements at (In millions) Measurement Level November 2, 2018 November 3, 2017 February 2, 2018 Short-term investments: Available-for-sale securities Money market funds Level 1 $ 181 $ 70 $ 86 Certificates of deposit Level 1 17 15 16 Agency securities Level 2 10 — — Total short-term investments $ 208 $ 85 $ 102 Long-term investments: Available-for-sale securities Corporate debt securities Level 2 $ 224 $ — $ — Agency securities Level 2 66 — — Municipal floating rate obligations Level 2 — 368 407 Certificates of deposit Level 1 — 2 1 Total long-term investments $ 290 $ 370 $ 408 |
Fair value measurements - nonrecurring basis | The following table presents the Company’s non-financial assets measured at estimated fair value on a nonrecurring basis and the resulting long-lived asset impairment losses included in earnings. 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 November 2, 2018 . Fair Value Measurements Impairment Losses (In millions) November 2, 2018 Three Months Ended November 2, 2018 Nine Months Ended November 2, 2018 Assets-held-for-use: Operating locations $ 473 $ (112 ) $ (329 ) Total $ 473 $ (112 ) $ (329 ) |
Fair value of financial instruments | Carrying amounts and the related estimated fair value of the Company’s long-term debt, excluding capitalized lease obligations, are as follows: November 2, 2018 November 3, 2017 February 2, 2018 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Unsecured notes (Level 1) $ 14,718 $ 14,430 $ 14,958 $ 15,974 $ 14,961 $ 15,608 Mortgage notes (Level 2) 6 6 7 7 6 7 Long-term debt (excluding capitalized lease obligations) $ 14,724 $ 14,436 $ 14,965 $ 15,981 $ 14,967 $ 15,615 |
Exit Activities (Tables)
Exit Activities (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Exit Activities | |
Schedule of exit activity expenses | A summary of the significant components of charges associated with the exit activities discussed above, are as follows: Costs Incurred Three Months Ended Nine Months Ended (In millions) November 2, 2018 November 2, 2018 Long-lived asset impairments $ 121 $ 327 Accelerated depreciation and amortization 103 103 Severance costs 32 32 Discontinued project write-offs 10 34 Lease obligation costs for closed locations 9 9 Inventory adjustments to net realizable value 5 5 Total $ 280 $ 510 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Shareholders' Equity | |
Schedule of share repurchases | Shares repurchased for the three and nine months ended November 2, 2018 and November 3, 2017 were as follows: Three Months Ended November 2, 2018 November 3, 2017 (In millions) Shares Cost 1 Shares Cost 1 Share repurchase program 5.7 $ 620 6.4 $ 500 Shares withheld from employees 0.2 25 0.4 27 Total share repurchases 5.9 $ 645 6.8 $ 527 1 Reductions of $603 million and $495 million were recorded to retained earnings, after capital in excess of par value was depleted, for the three months ended November 2, 2018 and November 3, 2017 , respectively. Nine Months Ended November 2, 2018 November 3, 2017 (In millions) Shares Cost 2 Shares Cost 2 Share repurchase program 25.9 $ 2,470 37.5 $ 3,000 Shares withheld from employees 0.3 38 0.5 41 Total share repurchases 26.2 $ 2,508 38.0 $ 3,041 2 Reductions of $2.3 billion and $2.9 billion were recorded to retained earnings, after capital in excess of par value was depleted, for the nine months ended November 2, 2018 and November 3, 2017 , respectively. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Earnings Per Share | |
Schedule of earnings per share, basic and diluted | The following table reconciles earnings per common share for the three and nine months ended November 2, 2018 and November 3, 2017 : Three Months Ended Nine Months Ended (In millions, except per share data) November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 Basic earnings per common share: Net earnings $ 629 $ 872 $ 3,138 $ 2,893 Less: Net earnings allocable to participating securities (1 ) (2 ) (10 ) (10 ) Net earnings allocable to common shares, basic 628 $ 870 $ 3,128 $ 2,883 Weighted-average common shares outstanding 806 831 815 843 Basic earnings per common share $ 0.78 $ 1.05 $ 3.84 $ 3.42 Diluted earnings per common share: Net earnings $ 629 $ 872 $ 3,138 $ 2,893 Less: Net earnings allocable to participating securities (1 ) (2 ) (10 ) (10 ) Net earnings allocable to common shares, diluted $ 628 $ 870 $ 3,128 $ 2,883 Weighted-average common shares outstanding 806 831 815 843 Dilutive effect of non-participating share-based awards 1 1 1 1 Weighted-average common shares, as adjusted 807 832 816 844 Diluted earnings per common share $ 0.78 $ 1.05 $ 3.83 $ 3.42 |
Supplemental Disclosure (Tables
Supplemental Disclosure (Tables) | 9 Months Ended |
Nov. 02, 2018 | |
Supplemental Disclosure | |
Net interest expense | Net interest expense is comprised of the following: Three Months Ended Nine Months Ended (In millions) November 2, 2018 November 3, 2017 November 2, 2018 November 3, 2017 Long-term debt $ 145 $ 146 $ 437 $ 438 Capitalized lease obligations 15 14 44 41 Interest income (9 ) (2 ) (21 ) (10 ) Interest capitalized — (2 ) (2 ) (4 ) Interest on tax uncertainties — — — (1 ) Other 2 4 9 15 Interest - net $ 153 $ 160 $ 467 $ 479 |
Supplemental disclosures of cash flow information | Supplemental disclosures of cash flow information: Nine Months Ended (In millions) November 2, 2018 November 3, 2017 Cash paid for interest, net of amount capitalized $ 555 $ 610 Cash paid for income taxes - net $ 1,069 $ 1,322 Non-cash investing and financing activities: Non-cash property acquisitions, including assets acquired under capital lease $ 42 $ 91 Cash dividends declared but not paid $ 387 $ 341 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | Feb. 02, 2018 | |
Consolidated Statements Of Earnings | |||||
Net sales | $ 17,415 | $ 16,770 | $ 55,662 | $ 53,125 | |
Cost of sales | 11,755 | 11,057 | 36,791 | 34,942 | |
Gross margin | 5,660 | 5,713 | 18,871 | 18,183 | |
Selling, general and administrative | 4,270 | 3,808 | 13,147 | 11,615 | |
Operating income | 957 | 1,547 | 4,586 | 5,488 | |
Pre-tax earnings | 804 | 1,387 | 4,119 | 4,545 | |
Net earnings | 629 | 872 | 3,138 | 2,893 | |
Consolidated Balance Sheet | |||||
Other current assets | 897 | 788 | 897 | 788 | $ 689 |
Accounts payable | 9,283 | 8,903 | 9,283 | 8,903 | 6,590 |
Deferred revenue | 1,356 | 1,404 | 1,356 | 1,404 | 1,378 |
Other current liabilities | 2,507 | $ 2,155 | 2,507 | $ 2,155 | $ 1,950 |
Accounting Standards Update 2014-09 | Calculated under Revenue Guidance in Effect before Topic 606 | |||||
Consolidated Statements Of Earnings | |||||
Net sales | 17,176 | 55,150 | |||
Cost of sales | 11,777 | 36,849 | |||
Gross margin | 5,399 | 18,301 | |||
Selling, general and administrative | 4,009 | 12,578 | |||
Operating income | 957 | 4,585 | |||
Pre-tax earnings | 804 | 4,118 | |||
Net earnings | 629 | 3,137 | |||
Consolidated Balance Sheet | |||||
Other current assets | 746 | 746 | |||
Accounts payable | 9,272 | 9,272 | |||
Deferred revenue | 1,433 | 1,433 | |||
Other current liabilities | 2,339 | 2,339 | |||
Accounting Standards Update 2014-09 | Difference between Revenue Guidance in Effect before and after Topic 606 | |||||
Consolidated Statements Of Earnings | |||||
Net sales | 239 | 512 | |||
Cost of sales | (22) | (58) | |||
Gross margin | 261 | 570 | |||
Selling, general and administrative | 261 | 569 | |||
Operating income | 0 | 1 | |||
Pre-tax earnings | 0 | 1 | |||
Net earnings | 0 | 1 | |||
Consolidated Balance Sheet | |||||
Other current assets | 151 | 151 | |||
Accounts payable | 11 | 11 | |||
Deferred revenue | (77) | (77) | |||
Other current liabilities | $ 168 | $ 168 |
Net Sales (Details)
Net Sales (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 17,415 | $ 16,770 | $ 55,662 | $ 53,125 |
Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 16,293 | 15,903 | 52,527 | 50,720 |
Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 665 | 657 | 1,999 | 1,915 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 457 | $ 210 | $ 1,136 | $ 490 |
Net Sales (Details 1)
Net Sales (Details 1) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | ||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 17,415 | $ 16,770 | $ 55,662 | $ 53,125 | |
Percentage of net sales | 100.00% | 100.00% | 100.00% | 100.00% | |
Building and Maintenance | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | [1] | $ 7,322 | $ 7,202 | $ 22,042 | $ 21,069 |
Percentage of net sales | [1] | 42.00% | 43.00% | 40.00% | 40.00% |
Home Décor | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | [2] | $ 6,959 | $ 6,874 | $ 21,207 | $ 20,688 |
Percentage of net sales | [2] | 40.00% | 41.00% | 37.00% | 39.00% |
Seasonal | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | [3] | $ 2,570 | $ 2,382 | $ 10,964 | $ 10,573 |
Percentage of net sales | [3] | 15.00% | 15.00% | 20.00% | 20.00% |
Other | |||||
Disaggregation of Revenue [Line Items] | |||||
Net sales | $ 564 | $ 312 | $ 1,449 | $ 795 | |
Percentage of net sales | 3.00% | 1.00% | 3.00% | 1.00% | |
[1] | Home Décor includes the following product categories: Appliances, Fashion Fixtures, Flooring, Kitchens, and Paint | ||||
[2] | Building & Maintenance includes the following product categories: Lumber & Building Materials, Millwork, Rough Plumbing & Electrical, and Tools & Hardware | ||||
[3] | Seasonal includes the following product categories: Lawn & Garden and Seasonal & Outdoor Living |
Net Sales (Details 2)
Net Sales (Details 2) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 17,415 | $ 16,770 | $ 55,662 | $ 53,125 |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 15,991 | 15,279 | 51,319 | 49,102 |
International | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 1,424 | $ 1,491 | $ 4,343 | $ 4,023 |
Net Sales (Details Textual)
Net Sales (Details Textual) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Contract with Customer, Asset and Liability | ||||
Sales return liability | $ 229 | $ 229 | ||
Right of return assets | 151 | 151 | ||
Sales return liability, net | $ 85 | $ 85 | ||
Deferred Revenue | ||||
Deferred revenue from undelivered products and installation | 945 | 952 | 945 | 952 |
Outstanding stored-value cards | 411 | 452 | 411 | 452 |
Deferred revenue recognized into sales from extended protection plans | 97 | 92 | 293 | 273 |
Expenses for claims incurred | $ 47 | $ 43 | $ 141 | $ 119 |
Minimum | ||||
Deferred Revenue | ||||
Extended product warranty term | 1 year | |||
Maximum | ||||
Deferred Revenue | ||||
Extended product warranty term | 5 years |
Acquisitions (Details)
Acquisitions (Details) - USD ($) $ in Millions | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 | Jun. 23, 2017 |
Allocation: | ||||
Goodwill | $ 1,272 | $ 1,307 | $ 1,327 | |
Maintenance Supply Headquarters | ||||
Allocation: | ||||
Cash acquired | $ 4 | |||
Merchandise inventory | 68 | |||
Other current assets | 36 | |||
Property | 12 | |||
Goodwill | 160 | |||
Other assets | 260 | |||
Accounts payable | (18) | |||
Other current liabilities | (9) | |||
Net assets acquired | $ 513 |
Acquisitions (Details Textual)
Acquisitions (Details Textual) - Maintenance Supply Headquarters $ in Millions | Jun. 23, 2017USD ($) |
Business Acquisition [Line Items] | |
Consideration transferred | $ 513 |
Intangible assets acquired | 259 |
Goodwill expected to be tax deductible | 160 |
Trademark | |
Business Acquisition [Line Items] | |
Intangible assets acquired | $ 34 |
Useful life of intangible assets acquired | 15 years |
Customer List | |
Business Acquisition [Line Items] | |
Intangible assets acquired | $ 225 |
Useful life of intangible assets acquired | 20 years |
Investment in Australian Join_2
Investment in Australian Joint Venture (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |
Aug. 04, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Investment in Australian Joint Venture | |||
Proceeds from sale/maturity of investments | $ 1,309 | $ 870 | |
Hydrox Holdings Pty Ltd. | |||
Investment in Australian Joint Venture | |||
Proceeds from sale/maturity of investments | $ 199 | ||
Cost method investments, realized gains | $ 96 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - Fair Value, Measurements, Recurring - Estimate of Fair Value - USD ($) $ in Millions | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 |
Short-term Investments | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | $ 208 | $ 102 | $ 85 |
Short-term Investments | Money market funds | Fair Value (Level 1) | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | 181 | 86 | 70 |
Short-term Investments | Certificates of deposit | Fair Value (Level 1) | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | 17 | 16 | 15 |
Short-term Investments | Agency securities | Fair Value (Level 2) | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | 10 | 0 | 0 |
Long-term Investments | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | 290 | 408 | 370 |
Long-term Investments | Certificates of deposit | Fair Value (Level 1) | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | 0 | 1 | 2 |
Long-term Investments | Corporate debt securities | Fair Value (Level 2) | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | 224 | 0 | 0 |
Long-term Investments | Agency securities | Fair Value (Level 2) | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | 66 | 0 | 0 |
Long-term Investments | Municipal floating rate obligations | Fair Value (Level 2) | |||
Investments, Fair Value Disclosure | |||
Available-for-sale debt securities, fair value | $ 0 | $ 407 | $ 368 |
Fair Value Measurements (Deta_2
Fair Value Measurements (Details 1) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018USD ($)location | Aug. 03, 2018USD ($) | Nov. 02, 2018USD ($) | Oct. 31, 2018store | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Costs Incurred | $ 280 | $ 510 | ||
Asset Impairment Charges | ||||
Asset impairment charges | (112) | (329) | ||
Long-lived asset impairments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Costs Incurred | 121 | 327 | ||
Strategic Reassessment Closures | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Costs Incurred | 0 | |||
Asset Impairment Charges | ||||
Number of stores expected to be closed, U.S. | store | 20 | |||
Number of locations expected to be closed, Canada | store | 31 | |||
Number of stores expected to be closed, Canada | store | 27 | |||
Strategic Reassessment Closures | Long-lived asset impairments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Costs Incurred | 90 | |||
Orchard Supply Hardware | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Costs Incurred | $ 123 | $ 230 | ||
Orchard Supply Hardware | Long-lived asset impairments | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Costs Incurred | 206 | |||
Mexico Operating Locations and Corporate Facility | ||||
Asset Impairment Charges | ||||
Number of locations evaluated for recoverability | location | 13 | |||
Operating locations | ||||
Asset Impairment Charges | ||||
Asset impairment charges | $ (112) | (329) | ||
Fair Value, Measurements, Nonrecurring | Mexico Operating Locations and Corporate Facility | ||||
Asset Impairment Charges | ||||
Asset impairment charges | (22) | |||
Fair Value, Measurements, Nonrecurring | U.S. and Canada Operating Locations and Exit Of Non-Core Activities | ||||
Asset Impairment Charges | ||||
Asset impairment charges | (99) | |||
Fair Value, Measurements, Nonrecurring | U.S. & Canada Operating Locations | ||||
Asset Impairment Charges | ||||
Asset impairment charges | (90) | |||
Fair Value, Measurements, Nonrecurring | Exit of Non-core Activities | ||||
Asset Impairment Charges | ||||
Asset impairment charges | (9) | |||
Fair Value, Measurements, Nonrecurring | Estimate of Fair Value | Fair Value (Level 3) | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value measurement | 473 | 473 | ||
Fair Value, Measurements, Nonrecurring | Estimate of Fair Value | Fair Value (Level 3) | Orchard Supply Hardware | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value measurement | $ 284 | |||
Fair Value, Measurements, Nonrecurring | Estimate of Fair Value | Fair Value (Level 3) | Mexico Operating Locations and Corporate Facility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value measurement | 107 | 107 | ||
Fair Value, Measurements, Nonrecurring | Estimate of Fair Value | Fair Value (Level 3) | U.S. & Canada Operating Locations | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value measurement | 81 | 81 | ||
Fair Value, Measurements, Nonrecurring | Estimate of Fair Value | Fair Value (Level 3) | Operating locations | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Fair value measurement | $ 473 | $ 473 |
Fair Value Measurements (Deta_3
Fair Value Measurements (Details 2) - USD ($) $ in Millions | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 |
Financial Instruments | |||
Long-term debt carrying value (excluding capitalized lease obligations) | $ 14,724 | $ 14,967 | $ 14,965 |
Unsecured Notes | |||
Financial Instruments | |||
Long-term debt carrying value (excluding capitalized lease obligations) | 14,718 | 14,961 | 14,958 |
Mortgage Notes | |||
Financial Instruments | |||
Long-term debt carrying value (excluding capitalized lease obligations) | 6 | 6 | 7 |
Estimate of Fair Value | |||
Financial Instruments | |||
Long-term debt fair value (excluding capitalized lease obligations) | 14,436 | 15,615 | 15,981 |
Estimate of Fair Value | Unsecured Notes | Fair Value (Level 1) | |||
Financial Instruments | |||
Long-term debt fair value (excluding capitalized lease obligations) | 14,430 | 15,608 | 15,974 |
Estimate of Fair Value | Mortgage Notes | Fair Value (Level 2) | |||
Financial Instruments | |||
Long-term debt fair value (excluding capitalized lease obligations) | $ 6 | $ 7 | $ 7 |
Restricted Investment Balances
Restricted Investment Balances (Details) - USD ($) $ in Millions | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 |
Restricted Investment Balances | |||
Restricted balances included in short-term investments | $ 191 | $ 86 | $ 70 |
Restricted balances included in long-term investments | $ 255 | $ 381 | $ 332 |
Property (Details)
Property (Details) - USD ($) $ in Billions | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 |
Property | |||
Accumulated depreciation | $ 17.7 | $ 17.2 | $ 17.1 |
Exit Activities (Details)
Exit Activities (Details) $ in Millions | Aug. 17, 2018store | Nov. 02, 2018USD ($) | Aug. 03, 2018USD ($) | Nov. 02, 2018USD ($) | Nov. 09, 2018store | Oct. 31, 2018store |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | $ 280 | $ 510 | ||||
Long-lived asset impairments | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 121 | 327 | ||||
Accelerated depreciation and amortization | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 103 | 103 | ||||
Severance costs | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 32 | 32 | ||||
Lease obligation costs | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 9 | 9 | ||||
Discontinued project write-offs | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 10 | 34 | ||||
Inventory adjustments to net realizable value | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 5 | 5 | ||||
Orchard Supply Hardware | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Number of stores expected to be closed | store | 99 | |||||
Costs Incurred | 123 | $ 230 | ||||
Orchard Supply Hardware | Minimum | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Estimated Costs to be Incurred | 270 | 270 | ||||
Orchard Supply Hardware | Maximum | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Estimated Costs to be Incurred | 350 | 350 | ||||
Orchard Supply Hardware | Long-lived asset impairments | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 206 | |||||
Orchard Supply Hardware | Store Closing and Discontinued Projects | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | $ 24 | |||||
Orchard Supply Hardware | Accelerated depreciation and amortization | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 103 | |||||
Orchard Supply Hardware | Severance costs | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 11 | |||||
Orchard Supply Hardware | Lease obligation costs | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 9 | |||||
Strategic Reassessment Closures | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 0 | |||||
Number of stores expected to be closed, U.S. | store | 20 | |||||
Number of locations expected to be closed, Canada | store | 31 | |||||
Number of stores expected to be closed, Canada | store | 27 | |||||
Strategic Reassessment Closures | Minimum | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Estimated Costs to be Incurred | 190 | 190 | ||||
Strategic Reassessment Closures | Maximum | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Estimated Costs to be Incurred | 230 | $ 230 | ||||
Strategic Reassessment Closures | Long-lived asset impairments | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 90 | |||||
Strategic Reassessment Closures | Severance costs | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 21 | |||||
Strategic Reassessment Closures | Discontinued project write-offs | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 10 | |||||
Exit of Non-core Activities | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 14 | |||||
Exit of Non-core Activities | Long-lived asset impairments | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 9 | |||||
Exit of Non-core Activities | Inventory adjustments to net realizable value | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | 5 | |||||
Mexico Retail Operations | Subsequent Event | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Number of stores expected to be closed in remainder of fiscal year | store | 13 | |||||
Mexico Retail Operations | Long-lived asset impairments | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||
Costs Incurred | $ 22 |
Exit Activities (Details 1)
Exit Activities (Details 1) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Nov. 02, 2018 | Nov. 02, 2018 | |
Restructuring Cost and Reserve | ||
Costs Incurred | $ 280 | $ 510 |
Long-lived asset impairments | ||
Restructuring Cost and Reserve | ||
Costs Incurred | 121 | 327 |
Accelerated depreciation and amortization | ||
Restructuring Cost and Reserve | ||
Costs Incurred | 103 | 103 |
Severance costs | ||
Restructuring Cost and Reserve | ||
Costs Incurred | 32 | 32 |
Discontinued project write-offs | ||
Restructuring Cost and Reserve | ||
Costs Incurred | 10 | 34 |
Lease obligation costs | ||
Restructuring Cost and Reserve | ||
Costs Incurred | 9 | 9 |
Inventory adjustments to net realizable value | ||
Restructuring Cost and Reserve | ||
Costs Incurred | $ 5 | $ 5 |
Short-Term Borrowings (Details
Short-Term Borrowings (Details Textual) - USD ($) | 1 Months Ended | |||
Sep. 30, 2018 | Nov. 02, 2018 | Feb. 02, 2018 | Nov. 03, 2017 | |
Short-term Debt [Line Items] | ||||
Short-term borrowings | $ 0 | $ 1,137,000,000 | $ 171,000,000 | |
Revolving Credit Facility | Second Amended and Restated Credit Agreement | ||||
Short-term Debt [Line Items] | ||||
Maximum borrowing capacity | $ 1,750,000,000 | |||
Debt instrument, Term | 5 years | |||
Optional increase in borrowing capacity | $ 500,000,000 | |||
Line of Credit | 364 Day Credit Agreement | ||||
Short-term Debt [Line Items] | ||||
Maximum borrowing capacity | $ 250,000,000 | |||
Commercial Paper | ||||
Short-term Debt [Line Items] | ||||
Short-term borrowings | $ 171,000,000 | |||
Weighted average interest rate | 1.37% |
Shareholders' Equity (Details)
Shareholders' Equity (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||||||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |||||
Share Repurchases | ||||||||
Share repurchases, shares | 5.9 | 6.8 | 26.2 | 38 | ||||
Share repurchases, value | $ 645 | [1] | $ 527 | [1] | $ 2,508 | [2] | $ 3,041 | [2] |
Reduction in retained earnings | $ 603 | $ 495 | $ 2,325 | $ 2,861 | ||||
Share Repurchase Program | ||||||||
Share Repurchases | ||||||||
Share repurchases, shares | 5.7 | 6.4 | 25.9 | 37.5 | ||||
Share repurchases, value | $ 620 | [1] | $ 500 | [1] | $ 2,470 | [2] | $ 3,000 | [2] |
Shares Withheld from Employees | ||||||||
Share Repurchases | ||||||||
Share repurchases, shares | 0.2 | 0.4 | 0.3 | 0.5 | ||||
Share repurchases, value | $ 25 | [1] | $ 27 | [1] | $ 38 | [2] | $ 41 | [2] |
[1] | Reductions of $603 million and $495 million were recorded to retained earnings, after capital in excess of par value was depleted, for the three months ended November 2, 2018 and November 3, 2017, respectively. | |||||||
[2] | Reductions of $2.3 billion and $2.9 billion were recorded to retained earnings, after capital in excess of par value was depleted, for the nine months ended November 2, 2018 and November 3, 2017, respectively. |
Shareholders' Equity (Details T
Shareholders' Equity (Details Textual) - USD ($) shares in Millions | Nov. 02, 2018 | Aug. 31, 2018 | Aug. 03, 2018 | May 31, 2018 | Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | Jan. 26, 2018 | ||||
Share Repurchases | |||||||||||||
Share repurchases, value | $ 645,000,000 | [1] | $ 527,000,000 | [1] | $ 2,508,000,000 | [2] | $ 3,041,000,000 | [2] | |||||
Cash used to repurchase shares | $ 2,498,000,000 | $ 3,054,000,000 | |||||||||||
Share repurchases, shares | 5.9 | 6.8 | 26.2 | 38 | |||||||||
Share Repurchase Program | |||||||||||||
Share Repurchases | |||||||||||||
Remaining share repurchases authorization, value | $ 4,500,000,000 | $ 4,500,000,000 | $ 4,500,000,000 | ||||||||||
Share repurchases, value | $ 620,000,000 | [1] | $ 500,000,000 | [1] | $ 2,470,000,000 | [2] | $ 3,000,000,000 | [2] | |||||
Share repurchases, shares | 5.7 | 6.4 | 25.9 | 37.5 | |||||||||
January 26, 2018 Share Repurchase Authorization | |||||||||||||
Share Repurchases | |||||||||||||
Share repurchases authorized, value | $ 5,000,000,000 | ||||||||||||
May 2018 Accelerated Share Repurchase Agreement Purchases | |||||||||||||
Share Repurchases | |||||||||||||
Share repurchases, value | $ 550,000,000 | ||||||||||||
Cash used to repurchase shares | $ 550,000,000 | ||||||||||||
Share repurchases, shares | 0.8 | 4.8 | |||||||||||
August 2018 Accelerated Share Repurchase Agreement Purchases | |||||||||||||
Share Repurchases | |||||||||||||
Share repurchases, value | $ 310,000,000 | ||||||||||||
Cash used to repurchase shares | $ 310,000,000 | ||||||||||||
Share repurchases, shares | 0.3 | 2.5 | |||||||||||
Open market purchases | |||||||||||||
Share Repurchases | |||||||||||||
Share repurchases, value | $ 310,000,000 | $ 1,600,000,000 | |||||||||||
Share repurchases, shares | 2.9 | 17.5 | |||||||||||
[1] | Reductions of $603 million and $495 million were recorded to retained earnings, after capital in excess of par value was depleted, for the three months ended November 2, 2018 and November 3, 2017, respectively. | ||||||||||||
[2] | Reductions of $2.3 billion and $2.9 billion were recorded to retained earnings, after capital in excess of par value was depleted, for the nine months ended November 2, 2018 and November 3, 2017, respectively. |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Basic earnings per common share: | ||||
Net earnings | $ 629 | $ 872 | $ 3,138 | $ 2,893 |
Less: Net earnings allocable to participating securities | (1) | (2) | (10) | (10) |
Net earnings allocable to common shares, basic | $ 628 | $ 870 | $ 3,128 | $ 2,883 |
Weighted-average common shares outstanding (in shares) | 806 | 831 | 815 | 843 |
Basic earnings per common share (in dollars per share) | $ 0.78 | $ 1.05 | $ 3.84 | $ 3.42 |
Diluted earnings per common share: | ||||
Net earnings | $ 629 | $ 872 | $ 3,138 | $ 2,893 |
Less: Net earnings allocable to participating securities | (1) | (2) | (10) | (10) |
Net earnings allocable to common shares, diluted | $ 628 | $ 870 | $ 3,128 | $ 2,883 |
Weighted-average common shares outstanding (in shares) | 806 | 831 | 815 | 843 |
Dilutive effect of non-participating share-based awards (in shares) | 1 | 1 | 1 | 1 |
Weighted-average common shares, as adjusted (in shares) | 807 | 832 | 816 | 844 |
Diluted earnings per common share (in dollars per share) | $ 0.78 | $ 1.05 | $ 3.83 | $ 3.42 |
Earnings Per Share (Details Tex
Earnings Per Share (Details Textual) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Earnings Per Share | ||||
Anti-dilutive securities | 0.2 | 1 | 0.4 | 1 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Income Taxes | ||||
Effective income tax rate | 21.80% | 37.10% | 23.80% | 36.30% |
Supplemental Disclosure (Detail
Supplemental Disclosure (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 02, 2018 | Nov. 03, 2017 | Nov. 02, 2018 | Nov. 03, 2017 | |
Net interest expense | ||||
Long-term debt | $ 145 | $ 146 | $ 437 | $ 438 |
Capitalized lease obligations | 15 | 14 | 44 | 41 |
Interest income | (9) | (2) | (21) | (10) |
Interest capitalized | 0 | (2) | (2) | (4) |
Interest on tax uncertainties | 0 | 0 | 0 | (1) |
Other | 2 | 4 | 9 | 15 |
Interest - net | $ 153 | $ 160 | $ 467 | $ 479 |
Supplemental Disclosure (Deta_2
Supplemental Disclosure (Details 1) - USD ($) $ in Millions | 9 Months Ended | |
Nov. 02, 2018 | Nov. 03, 2017 | |
Supplemental disclosures of cash flow information | ||
Cash paid for interest, net of amount capitalized | $ 555 | $ 610 |
Cash paid for income taxes - net | 1,069 | 1,322 |
Non-cash investing and financing activities: | ||
Non-cash property acquisitions, including assets acquired under capital lease | 42 | 91 |
Cash dividends declared but not paid | $ 387 | $ 341 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Nov. 09, 2018store | Nov. 02, 2018USD ($) | Feb. 02, 2018USD ($) | Nov. 03, 2017USD ($) |
Subsequent Event [Line Items] | ||||
Assets | $ 36,713 | $ 35,291 | $ 36,783 | |
Mexico Retail Operations | ||||
Subsequent Event [Line Items] | ||||
Assets | 294 | |||
Cumulative translation adjustment | $ 100 | |||
Mexico Retail Operations | Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Number of stores in operation at exit decision date | store | 13 |