Cover
Cover | 9 Months Ended |
Sep. 30, 2022 | |
Cover [Abstract] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Sep. 30, 2022 |
Document Transition Report | false |
Entity File Number | 001-38654 |
Entity Registrant Name | QVC, Inc. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 23-2414041 |
Entity Address, Address Line One | 1200 Wilson Drive |
Entity Address, City or Town | West Chester |
Entity Address, State or Province | PA |
Entity Address, Postal Zip Code | 19380 |
City Area Code | (484) |
Local Phone Number | 701-1000 |
Debt and Equity Securities, FV-NI [Line Items] | |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Non-accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
6.375% Senior Secured Notes [Member] | |
Debt and Equity Securities, FV-NI [Line Items] | |
Title of 12(b) Security | 6.375% Senior Secured Notes due 2067 |
Trading Symbol | QVCD |
Security Exchange Name | NYSE |
6.25% Senior Secured Notes [Member] | |
Debt and Equity Securities, FV-NI [Line Items] | |
Title of 12(b) Security | 6.250% Senior Secured Notes due 2068 |
Trading Symbol | QVCC |
Security Exchange Name | NYSE |
Document and Entity Information
Document and Entity Information Document | 9 Months Ended |
Sep. 30, 2022 shares | |
Document Information [Abstract] | |
Entity Registrant Name | QVC, Inc. |
Entity Central Index Key | 0001254699 |
Current Fiscal Year End Date | --12-31 |
Entity Filer Category | Non-accelerated Filer |
Entity Common Stock, Shares Outstanding | 1 |
Document Type | 10-Q |
Document Period End Date | Sep. 30, 2022 |
Document Fiscal Year Focus | 2022 |
Document Fiscal Period Focus | Q3 |
Amendment Flag | false |
Entity Current Reporting Status | Yes |
Entity Shell Company | false |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Document Information [Line Items] | |
Entity Address, State or Province | PA |
Entity Address, City or Town | West Chester |
Entity Incorporation, State or Country Code | DE |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Current assets: | ||
Cash and cash equivalents | $ 517 | $ 510 |
Restricted cash | 9 | 9 |
Accounts Receivable, after Allowance for Credit Loss, Current | 992 | 1,645 |
Inventories | 1,386 | 1,355 |
Prepaid expenses and other current assets | 137 | 180 |
Total current assets | 3,041 | 3,699 |
Noncurrent assets: | ||
Property, Plant and Equipment, Net | 504 | 919 |
Operating Lease, Right-of-Use Asset | 420 | 201 |
Television distribution rights, net (note 2) | 95 | 145 |
Goodwill (note 3) | 3,399 | 5,968 |
Other intangible assets, net (note 3) | 3,188 | 3,407 |
Note receivable - related party (note 1) | 1,740 | 1,740 |
Other noncurrent assets | 55 | 62 |
Total assets | 12,442 | 16,141 |
Current liabilities: | ||
Current portion of debt and finance lease obligations (note 5) | 216 | 20 |
Accounts payable-trade | 833 | 1,271 |
Accrued liabilities (note 4) | 905 | 1,179 |
Total current liabilities | 1,954 | 2,470 |
Noncurrent liabilities: | ||
Long-term portion of debt and finance lease obligations (note 5) | 4,168 | 5,023 |
Deferred Income Tax Liabilities, Net | 580 | 633 |
Other long-term liabilities (note 4) | 512 | 294 |
Total liabilities | 7,214 | 8,420 |
QVC, Inc. stockholder's equity: | ||
Common Stock, Value, Issued | 0 | 0 |
Additional paid-in capital | 10,599 | 10,687 |
Accumulated deficit | (5,019) | (2,942) |
Accumulated other comprehensive loss | (451) | (146) |
Total QVC, Inc. stockholder's equity | 5,129 | 7,599 |
Noncontrolling interest | 99 | 122 |
Total equity | 5,228 | 7,721 |
Total liabilities and equity | $ 12,442 | $ 16,141 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Accounts Receivable, Allowance for Credit Loss, Current | $ 97 | $ 99 |
Accumulated depreciation | $ 1,010 | $ 1,371 |
Common stock par value | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 1 | 1 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Revenues | $ 2,217 | $ 2,512 | $ 6,963 | $ 8,002 |
Cost of goods sold (exclusive of depreciation and amortization shown separately below) | 1,526 | 1,617 | 4,775 | 5,130 |
Operating costs and expenses: | ||||
Operating | 186 | 183 | 543 | 565 |
Selling, general and administrative, including transaction related costs and stock-based compensation | 309 | 285 | 906 | 873 |
Depreciation | 21 | 37 | 88 | 115 |
Amortization | 73 | 74 | 217 | 200 |
Goodwill and Intangible Asset Impairment | 2,600 | 0 | 2,600 | 0 |
Unusual or Infrequent Item, or Both, Net of Insurance Proceeds | (137) | 0 | (134) | 0 |
Gain (Loss) on Disposition of Assets | (277) | 0 | (520) | 0 |
Operating expenses | 4,301 | 2,196 | 8,475 | 6,883 |
Operating (loss) income | (2,084) | 316 | (1,512) | 1,119 |
Other (expense) income: | ||||
Income (Loss) from Equity Method Investments | 0 | (2) | 0 | (2) |
Gain (Loss) on Derivative Instruments, Net, Pretax | 0 | (5) | 1 | (8) |
Interest expense, net | (50) | (64) | (175) | (192) |
Foreign currency gain (loss) | 21 | 0 | 50 | (4) |
Gain (Loss) on Extinguishment of Debt | 0 | 0 | (6) | 0 |
Other Income | 0 | 0 | 20 | 8 |
Nonoperating Income (Expense) | (29) | (71) | (110) | (198) |
(Loss) income before income taxes | (2,113) | 245 | (1,622) | 921 |
Income tax expense | (101) | (85) | (251) | (266) |
Net (loss) income | (2,214) | 160 | (1,873) | 655 |
Less net income attributable to the noncontrolling interest | (12) | (15) | (41) | (48) |
Net (loss) income attributable to QVC, Inc. stockholder | $ (2,226) | $ 145 | $ (1,914) | $ 607 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income Statement - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Net (loss) income | $ (2,214) | $ 160 | $ (1,873) | $ 655 |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax | (127) | (28) | (330) | (92) |
Other Comprehensive Income Loss Credit Risk On Fair Value Debt Instruments Gain (Loss) Net Of Tax | 0 | (7) | 0 | (19) |
Total comprehensive (loss) income | (2,341) | 125 | (2,203) | 544 |
Comprehensive income attributable to noncontrolling interest | (6) | (14) | (16) | (38) |
Comprehensive (loss) income attributable to QVC, Inc. stockholder | $ (2,347) | $ 111 | $ (2,219) | $ 506 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
Net (loss) income | $ (1,873) | $ 655 |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||
Deferred income taxes | (39) | (1) |
Foreign currency gain (loss) | (50) | 4 |
Depreciation | 88 | 115 |
Amortization | 217 | 200 |
Goodwill and Intangible Asset Impairment | 2,600 | 0 |
Change in fair value of financial instruments and noncash interest | (1) | 8 |
Other charges, net | 21 | 24 |
Gain (Loss) on Extinguishment of Debt | 6 | 0 |
Stock-based compensation | 27 | 33 |
Change in other long-term liabilities | 9 | 5 |
Gain (Loss) on Disposition of Assets | 520 | 0 |
Insured Event, Gain (Loss) | (139) | 0 |
Proceeds from Insurance Settlement, Operating Activities | 96 | 0 |
Decrease in accounts receivable | 482 | 443 |
Increase in inventories | (82) | (374) |
Decrease in prepaid expenses and other current assets | 42 | 47 |
Decrease in accounts payable-trade | (362) | (70) |
Decrease in accrued liabilities and other | (345) | (411) |
Net cash provided by operating activities | 177 | 678 |
Investing activities: | ||
Capital expenditures | (135) | (145) |
Expenditures for television distribution rights | (36) | (184) |
Proceeds from Insurance Settlement, Investing Activities | 184 | 0 |
Changes in other noncurrent assets | (5) | (3) |
Proceeds from Sales of Assets, Investing Activities | 701 | 40 |
Proceeds from Sale of Other Investments | 20 | 8 |
Net cash provided by (used in) investing activities | 729 | (284) |
Financing activities: | ||
Principal payments of debt and finance lease obligations | (1,942) | (157) |
Principal borrowings of debt from senior secured credit facility | 1,850 | 135 |
Repayments of Secured Debt | (536) | 0 |
Payment of premium on redemption of senior secured notes | (6) | 0 |
Dividends paid to noncontrolling interest | (39) | (46) |
Withholding taxes on net share settlements of stock-based compensation | (5) | (18) |
Payments for issuances of financial instruments | 0 | (38) |
Proceeds from settlements of financial instruments | 0 | 88 |
Other financing activities | 0 | 2 |
Net cash used in financing activities | (840) | (427) |
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash | (59) | (20) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 7 | (53) |
Cash, cash equivalents and restricted cash, beginning of period | 519 | 690 |
Cash, cash equivalents and restricted cash, end of period | 526 | 637 |
Qurate | ||
Financing activities: | ||
Dividends paid to Qurate Retail, Inc. | $ 162 | $ 393 |
Consolidated Statement of Equit
Consolidated Statement of Equity - USD ($) $ in Millions | Total | Common stock | Additional paid-in capital | Accumulated deficit | Accumulated other comprehensive loss | Noncontrolling interest |
Balance at Dec. 31, 2020 | $ 8,091 | $ 0 | $ 10,741 | $ (2,766) | $ (17) | $ 133 |
Balance beginning (in shares) at Dec. 31, 2020 | 1 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | 655 | 607 | 48 | |||
Foreign currency translation adjustments, net of tax | (92) | (82) | (10) | |||
(Dividends Paid To) Contributions Received From Wholly Owned Parent and Other | (439) | (393) | (46) | |||
Impact of tax liability allocation and indemnification agreement with Qurate Retail, Inc. | 13 | 13 | ||||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | 18 | 18 | ||||
Stock-based compensation | 33 | 33 | ||||
Other Comprehensive Income Loss Credit Risk On Fair Value Debt Instruments Gain (Loss) Net Of Tax | (19) | (19) | ||||
Balance ending (in shares) at Sep. 30, 2021 | 1 | |||||
Balance at Sep. 30, 2021 | 8,224 | $ 0 | 10,769 | (2,552) | (118) | 125 |
Balance at Jun. 30, 2021 | 8,190 | $ 0 | 10,753 | (2,605) | (84) | 126 |
Balance beginning (in shares) at Jun. 30, 2021 | 1 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | 160 | 145 | 15 | |||
Foreign currency translation adjustments, net of tax | (28) | (27) | (1) | |||
(Dividends Paid To) Contributions Received From Wholly Owned Parent and Other | (107) | (92) | (15) | |||
Impact of tax liability allocation and indemnification agreement with Qurate Retail, Inc. | 4 | 4 | ||||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | 1 | 1 | ||||
Stock-based compensation | 13 | 13 | ||||
Other Comprehensive Income Loss Credit Risk On Fair Value Debt Instruments Gain (Loss) Net Of Tax | (7) | (7) | ||||
Balance ending (in shares) at Sep. 30, 2021 | 1 | |||||
Balance at Sep. 30, 2021 | 8,224 | $ 0 | 10,769 | (2,552) | (118) | 125 |
Balance at Dec. 31, 2021 | 7,721 | $ 0 | 10,687 | (2,942) | (146) | 122 |
Balance beginning (in shares) at Dec. 31, 2021 | 1 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | (1,873) | (1,914) | 41 | |||
Foreign currency translation adjustments, net of tax | (330) | (305) | (25) | |||
(Dividends Paid To) Contributions Received From Wholly Owned Parent and Other | (201) | (162) | (39) | |||
Impact of tax liability allocation and indemnification agreement with Qurate Retail, Inc. | (1) | 0 | (1) | |||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | 5 | 5 | ||||
Stock-based compensation | 27 | 27 | ||||
Common control transaction with Qurate Retail, Inc. | (110) | (110) | ||||
Other Comprehensive Income Loss Credit Risk On Fair Value Debt Instruments Gain (Loss) Net Of Tax | 0 | |||||
Balance ending (in shares) at Sep. 30, 2022 | 1 | |||||
Balance at Sep. 30, 2022 | 5,228 | $ 0 | 10,599 | (5,019) | (451) | 99 |
Balance at Jun. 30, 2022 | 7,652 | $ 0 | 10,628 | (2,751) | (330) | 105 |
Balance beginning (in shares) at Jun. 30, 2022 | 1 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | (2,214) | (2,226) | 12 | |||
Foreign currency translation adjustments, net of tax | (127) | (121) | (6) | |||
(Dividends Paid To) Contributions Received From Wholly Owned Parent and Other | (53) | (41) | (12) | |||
Impact of tax liability allocation and indemnification agreement with Qurate Retail, Inc. | (5) | (4) | ||||
Stock-based compensation | 9 | 9 | ||||
Common control transaction with Qurate Retail, Inc. | (34) | (34) | ||||
Other Comprehensive Income Loss Credit Risk On Fair Value Debt Instruments Gain (Loss) Net Of Tax | 0 | |||||
Balance ending (in shares) at Sep. 30, 2022 | 1 | |||||
Balance at Sep. 30, 2022 | $ 5,228 | $ 0 | $ 10,599 | $ (5,019) | $ (451) | $ 99 |
Other Comprehensive Income (Com
Other Comprehensive Income (Component of Other Comprehensive Income) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||||
Foreign currency translation adjustments before tax | $ (131) | $ (27) | $ (337) | $ (89) |
Tax expense from foreign currency translation gain (loss) | 4 | (1) | 7 | (3) |
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss) Arising During Period, Net of Tax | (127) | (28) | (330) | (92) |
Debt credit risk adjustment | (7) | (19) | ||
Other Comprehensive Income (Loss), before Tax | (131) | (34) | (337) | (108) |
Other Comprehensive Income (Loss), Tax | 4 | (1) | 7 | (3) |
Other Comprehensive Income (Loss), Net of Tax | $ (127) | $ (35) | $ (330) | $ (111) |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2022 | |
Basis of Presentation [Abstract] | |
Basis of Accounting | Basis of Presentation QVC, Inc. and its consolidated subsidiaries (unless otherwise indicated or required by the context, the terms "we," "our," "us," the "Company" and "QVC" refer to QVC, Inc. and its consolidated subsidiaries) is a retailer of a wide range of consumer products, which are marketed and sold primarily by merchandise-focused televised shopping programs, the Internet and mobile applications. In the United States ("U.S."), QVC's televised shopping programs, including live and recorded content, are distributed across multiple channels nationally on a full-time basis, including QVC, QVC2, QVC3, HSN and HSN2. The Company's U.S. programming is also available on QVC.com and HSN.com, which we refer to as our "U.S. websites"; virtual multichannel video programming distributors (including Hulu + Live TV, AT&T TV, and YouTube TV); applications via streaming video; Facebook Live, Roku, Apple TV, Amazon Fire, Xfinity Flex and Samsung TV Plus; mobile applications; social pages and over-the-air broadcasters. QVC's digital platforms enable consumers to purchase goods offered on our televised programming, along with a wide assortment of products that are available only on our U.S. websites. QVC.com, HSN.com and our other digital platforms (including our mobile applications, social pages and others) are natural extensions of our business model, allowing customers to engage in our shopping experience wherever they are, with live or on-demand content customized to the device they are using. In addition to offering video content, our U.S. websites allow shoppers to browse, research, compare and perform targeted searches for products, read customer reviews, control the order-entry process and conveniently access their account. Internationally, QVC's televised shopping programs, including live and recorded content, are distributed to households outside of the U.S., primarily in Germany, Austria, Japan, the United Kingdom ("U.K."), the Republic of Ireland and Italy. In some of the countries where QVC operates, QVC's televised shopping programs are distributed across multiple QVC channels: QVC Style and QVC2 in Germany and QVC Beauty, QVC Extra and QVC Style in the U.K. Similar to the U.S., our international businesses also engage customers via websites, mobile applications, and social pages. QVC's international business employs product sourcing teams who select products tailored to the interests of each local market. The Company's Japanese operations ("QVC-Japan") are conducted through a joint venture with Mitsui & Co., LTD ("Mitsui"). QVC-Japan is owned 60% by the Company and 40% by Mitsui. The Company and Mitsui share in all profits and losses based on their respective ownership interests. During the nine months ended September 30, 2022 and 2021, QVC-Japan paid dividends to Mitsui of $39 million and $46 million, respectively. The Company is an indirect wholly-owned subsidiary of Qurate Retail, Inc. ("Qurate Retail") (Nasdaq: QRTEA, QRTEB and QRTEP), which owns interests in a broad range of digital commerce businesses, including Qurate Retail's other wholly-owned subsidiary Zulily, LLC ("Zulily"), as well as other minority investments. QVC is part of the Qurate Retail Group, formerly QVC Group, a portfolio of brands including QVC, Zulily and Cornerstone Brands, Inc. ("CBI"). During each of the nine months ended September 30, 2022 and 2021, QVC and Zulily engaged in multiple transactions relating to sales, sourcing of merchandise, marketing initiatives and business advisory services. QVC allocated expenses of $3 million and $6 million to Zulily for the nine months ended September 30, 2022 and 2021, respectively. Zulily allocated expenses of $6 million to QVC for each of the nine months ended September 30, 2022 and 2021. In September 2020, QVC and Zulily executed a Master Promissory Note ("Promissory Note") whereby Zulily may borrow up to $100 million at a variable interest rate equal to the LIBOR rate plus an applicable margin rate. The Promissory Note matures in September 2030. There were no borrowings on the Promissory Note as of September 30, 2022 and December 31, 2021. During each of the nine months ended September 30, 2022 and 2021, QVC and CBI engaged in multiple transactions relating to personnel and business advisory services. QVC allocated expenses of $22 million and $16 million to CBI for the nine months ended September 30, 2022 and 2021, respectively. CBI allocated expenses of $1 million to QVC for each of the nine months ended September 30, 2022 and 2021. In December 2019, a new coronavirus disease ("COVID-19'") pandemic was reported to have surfaced in Wuhan, China and has subsequently spread across the globe, including all of the countries in which QVC operates. Since that time, most local, state and federal governmental agencies imposed various restrictions to prevent the spread of COVID-19, including travel restrictions, local quarantines or stay at home restrictions, and vaccine and testing requirements. The spread of COVID-19 and the various containment measures put in place around the world have resulted in significant disruption to the global economy. Management is not presently aware of any events or circumstances arising from COVID-19 that would require the Company to update the estimates, judgments or revise the carrying value of our assets or liabilities. Management's estimates may change, however, as new events occur and additional information is obtained, and any such changes will be recognized in the consolidated financial statements. Actual results could differ from estimates, and any such differences may be material to our financial statements. On December 30, 2020, the Company and Liberty Interactive LLC ("LIC") completed an internal realignment of the Company's global finance structure that resulted in a common control transaction with Qurate Retail. As part of the common control transaction, LIC issued a promissory note (“LIC Note”) to the Company with an initial face amount of $1.8 billion, a stated interest rate of 0.48% and a maturity of December 29, 2029. Interest on the LIC Note is paid annually. QVC recorded $6 million of related party interest income for each of the nine months ended September 30, 2022 and 2021, included in interest expense, net in the consolidated statement of operations. The Company has revised its condensed consolidated financial statements and related notes included herein to correct immaterial errors in depreciation expense in periods prior to 2021, along with deferred tax adjustments. Revisions have been reflected in the comparative 2021 financial statements to reduce property and equipment, net by $47 million, reduce deferred tax liabilities by $3 million, and reduce retained earnings by $44 million, including the opening balance as of January 1, 2021. The condensed consolidated financial statements include the accounts of QVC, Inc. and its majority-owned subsidiaries. All significant intercompany accounts and transactions were eliminated in consolidation. The accompanying (a) condensed consolidated balance sheet as of December 31, 2021, which has been derived from audited financial statements, and (b) the interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results for such periods have been included. The results of operations for any interim period are not necessarily indicative of results for the full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in QVC's Annual Report on Form 10-K for the year ended December 31, 2021. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates include, but are not limited to, sales returns, uncollectible receivables, inventory obsolescence, internally-developed software, valuation of acquired intangible assets and goodwill and income taxes. |
Television Distribution Rights,
Television Distribution Rights, Net | 9 Months Ended |
Sep. 30, 2022 | |
Television Distribution Rights [Abstract] | |
Television Distribution Rights, Net | Television Distribution Rights, Net Television distribution rights consisted of the following: (in millions) September 30, 2022 December 31, 2021 Television distribution rights $ 723 818 Less accumulated amortization (628) (673) Television distribution rights, net $ 95 145 The Company recorded amortization expense of $29 million and $32 million for the three months ended September 30, 2022 and 2021, respectively, related to television distribution rights. For the nine months ended September 30, 2022 and 2021, amortization expense for television distribution rights was $88 million and $80 million, respectively. As of September 30, 2022, related amortization expense for each of the next five years ended December 31 was as follows (in millions): Remainder of 2022 $ 30 2023 51 2024 13 2025 1 2026 — |
Goodwill and Intangibles
Goodwill and Intangibles | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure | Goodwill and Other Intangible Assets, Net The changes in the carrying amount of goodwill by operating segment for the nine months ended September 30, 2022 were as follows: (in millions) QxH QVC-International Total Balance as of December 31, 2021 $ 5,112 856 5,968 Impairment (2,420) — (2,420) Exchange rate fluctuations — (149) (149) Balance as of September 30, 2022 $ 2,692 707 3,399 As a result of recent financial performance and macroeconomic conditions including inflation and higher interest rates, the Company initiated a process to evaluate its current business model and long-term business strategy. It was determined during the third quarter of 2022 that an indication of impairment existed for the QxH reporting unit related to its tradenames and goodwill. With the assistance of a third party specialist, the fair value of the tradenames was determined using the relief from royalty method, primarily using a discounted cash flow model using projections of future operating performance (income approach) and applying a royalty rate (market approach) (Level 3), and an impairment in the amount of $180 million related to the HSN Tradename was recorded during the third quarter of 2022, in impairment losses in the consolidated statements of operations. Accumulated tradename impairment loss as of September 30, 2022 is $357 million. With the assistance of a third party specialist, the fair value of the QxH reporting unit was determined using a discounted cash flow method (Level 3), and a goodwill impairment in the amount of $2,420 million was recorded during the third quarter of 2022, in impairment losses in the consolidated statements of operations. Accumulated goodwill impairment loss as of September 30, 2022 is $2,420 million. Based on the quantitative assessment performed during the third quarter and the resulting impairment losses recorded, the estimated fair values of the HSN tradename and the QxH reporting unit equal their carrying values as of September 30, 2022. Other intangible assets consisted of the following: September 30, 2022 December 31, 2021 (in millions) Gross Accumulated Other intangible assets, net Gross Accumulated Other intangible assets, net Purchased and internally developed software $ 1,014 (730) 284 945 (659) 286 Affiliate and customer relationships 2,802 (2,603) 199 2,832 (2,598) 234 Debt origination fees 9 (2) 7 9 — 9 Trademarks (indefinite life) 2,698 — 2,698 2,878 — 2,878 $ 6,523 (3,335) 3,188 6,664 (3,257) 3,407 The Company recorded amortization expense of $44 million and $42 million for the three months ended September 30, 2022 and 2021, respectively, related to other intangible assets. For the nine months ended September 30, 2022 and 2021, amortization expense for other intangible assets was $129 million and $120 million, respectively. As of September 30, 2022, the related amortization and interest expense for each of the next five years ended December 31 was as follows (in millions): Remainder of 2022 $ 50 2023 181 2024 136 2025 75 2026 48 |
Accrued Liabilities
Accrued Liabilities | 9 Months Ended |
Sep. 30, 2022 | |
Accrued Liabilities [Abstract] | |
Accrued liabilities | Accrued and Other Liabilities Accrued liabilities consisted of the following: (in millions) September 30, 2022 December 31, 2021 Accounts payable non-trade $ 334 364 Allowance for sales returns 139 242 Accrued compensation and benefits 108 151 Income taxes 103 132 Other 221 290 $ 905 1,179 |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt disclosure | Long-Term Debt and Finance Lease Obligations Long-term debt and finance lease obligations consisted of the following: (in millions) September 30, 2022 December 31, 2021 4.375% Senior Secured Notes due 2023, net of original issue discount $ 214 750 4.85% Senior Secured Notes due 2024, net of original issue discount 600 600 4.45% Senior Secured Notes due 2025, net of original issue discount 599 599 4.75% Senior Secured Notes due 2027 575 575 4.375% Senior Secured Notes due 2028 500 500 5.45% Senior Secured Notes due 2034, net of original issue discount 399 399 5.95% Senior Secured Notes due 2043, net of original issue discount 300 300 6.375% Senior Secured Notes due 2067 225 225 6.25% Senior Secured Notes due 2068 500 500 Senior secured credit facility (1) 505 481 Finance lease obligations (note 6) 5 157 Less debt issuance costs, net (38) (43) Total debt and finance lease obligations 4,384 5,043 Less current portion (216) (20) Long-term portion of debt and finance lease obligations $ 4,168 5,023 (1) Includes $261 million and $151 million of Zulily's outstanding borrowings as of September 30, 2022 and December 31, 2021, respectively. Senior Secured Notes All of QVC's senior secured notes are secured by the capital stock of QVC and have equal priority to the senior secured credit facility. The interest on QVC's senior secured notes is payable semi-annually with the exception of the 6.375% Senior Secured Notes due 2067 (the "2067 Notes") and the 6.25% Senior Secured Notes due 2068 (the "2068 Notes"), which is payable quarterly. In June 2022, QVC completed its purchase of $536 million of the outstanding 4.375% Senior Secured Notes due 2023 (the "2023 Notes") pursuant to a cash tender offer to purchase any and all of its outstanding 2023 Notes (the "Tender Offer"). As a result of the Tender Offer, the Company recorded a loss on extinguishment of debt in the condensed consolidated statements of operations of $6 million for the nine months ended September 30, 2022. As of September 30, 2022, the remaining outstanding 2023 Notes are classified within current portion of long term debt as they mature in less than one year. Senior Secured Credit Facility On October 27, 2021, QVC entered into the Fifth Amended and Restated Credit Agreement with QVC, Zulily, CBI, and QVC Global, each a direct or indirect wholly owned subsidiary of Qurate Retail, as borrowers (collectively, the “Borrowers”). The Fifth Amended and Restated Credit Agreement is a multi-currency facility providing for a $3.25 billion revolving credit facility, with a $450 million sub-limit for letters of credit and an alternative currency revolving sub-limit equal to 50% of the revolving commitments thereunder. The Fifth Amended and Restated Credit Agreement may be borrowed by any Borrower, with each Borrower jointly and severally liable for the outstanding borrowings. Borrowings bear interest at either the alternate base rate (“ABR Rate”) or a LIBOR-based rate (or the applicable non-U.S. Dollar equivalent rate) (“Term Benchmark/RFR Rate”) at the applicable Borrower’s election in each case plus a margin. Borrowings that are ABR Rate loans will bear interest at a per annum rate equal to the base rate plus a margin that varies between 0.25% and 0.625% depending on the Borrowers’ combined ratio of consolidated total debt to consolidated EBITDA (the “consolidated leverage ratio”). Borrowings that are Term Benchmark/RFR Rate loans will bear interest at a per annum rate equal to the applicable rate plus a margin that varies between 1.25% and 1.625% depending on the Borrowers’ consolidated leverage ratio. Each loan may be prepaid at any time and from time to time without penalty other than customary breakage costs. No mandatory prepayments will be required other than when borrowings and letter of credit usage exceed availability; provided that, if Zulily, CBI, QVC Global or any other borrower (other than QVC) is removed, at the election of QVC, as a borrower thereunder, all of its loans must be repaid and its letters of credit are terminated or cash collateralized. Any amounts prepaid may be reborrowed. The facility matures on October 27, 2026. Payment of loans may be accelerated following certain customary events of default. In accordance with the accounting guidance for obligations resulting from joint and several liability arrangements, QVC will record a liability for amounts it has borrowed under the senior secured credit facility plus any additional amount it expects to repay on behalf of Zulily or CBI. There was $261 million and $151 million borrowed by Zulily on the senior secured credit facility as of September 30, 2022 and December 31, 2021, respectively; all of which QVC expects to repay on behalf of Zulily. QVC recorded a liability for Zulily's outstanding borrowings as part of a common control transaction with Qurate Retail. The liability for Zulily's outstanding borrowings is included in the long-term portion of debt and finance lease obligations on the condensed consolidated balance sheets. QVC recorded a $34 million and $110 million liability for Zulily's additional borrowings during the three and nine months ended September 30, 2022, which was treated as a return of capital in the consolidated statements of equity. As of September 30, 2022, there was $40 million borrowed by CBI on the senior secured credit facility, none of which the Company expects to repay on behalf of CBI. Availability under the Fifth Amended and Restated Credit Agreement at September 30, 2022 was $2.68 billion. The interest rate on the senior secured credit facility was 4.5% at September 30, 2022. The payment and performance of the Borrowers’ obligations under the Fifth Amended and Restated Credit Agreement are guaranteed by each of QVC’s, QVC Global’s, Zulily’s and CBI’s Material Domestic Subsidiaries (as defined in the Fifth Amended and Restated Credit Agreement), if any, and certain other subsidiaries of any Borrower that such Borrower has chosen to provide guarantees. Further, the borrowings under the Fifth Amended and Restated Credit Agreement are secured, pari passu with QVC’s existing notes, by a pledge of all of QVC’s equity interests. The borrowings under the Fifth Amended and Restated Credit Agreement are also secured by a pledge of all of Zulily’s and CBI’s equity interests. The Fifth Amended and Restated Credit Agreement contains certain affirmative and negative covenants, including certain restrictions on the Borrowers and each of their respective restricted subsidiaries (subject to certain exceptions) with respect to, among other things: incurring additional indebtedness; creating liens on property or assets; making certain loans or investments; selling or disposing of assets; paying certain dividends and other restricted payments; dissolving, consolidating or merging; entering into certain transactions with affiliates; entering into sale or leaseback transactions; restricting subsidiary distributions; and limiting the Borrowers’ consolidated leverage ratio. Interest Rate Swap Arrangements In July 2019, the Company entered into a three-year interest swap arrangement with a notional amount of $125 million to mitigate the interest rate risk associated with interest payments related to its variable rate debt. The swap arrangement did not qualify as a cash flow hedge under U.S. GAAP. Changes in the fair value of the swap arrangement are reflected in (losses) gains on financial instruments in the condensed consolidated statements of operations. The swap arrangement expired in July 2022 and was in a net liability position of $1 million as of December 31, 2021, which was included in accrued liabilities. Other Debt Related Information QVC was in compliance with all of its debt covenants as of September 30, 2022. The weighted average interest rate applicable to all of the outstanding debt (excluding finance leases) prior to amortization of bond discounts and related debt issuance costs was 5.0% as of September 30, 2022. |
Lease and Transponder Service A
Lease and Transponder Service Agreements | 3 Months Ended |
Sep. 30, 2022 | |
Leases [Abstract] | |
Leases of Lessee | Leases Sale-Leaseback Transactions In June 2022, QVC modified the finance lease for its distribution center in Ontario, California which reduced the term of the lease and removed QVC’s ability to take ownership of the distribution center at the end of the lease term. QVC will make annual payments over the modified lease term. Since the lease was modified and removed QVC’s ability to take ownership at the end of the lease term, the Company accounted for the modification similar to a sale and leaseback transaction and, as a result, recognized a $240 million gain on the sale of the distribution center during the second quarter of 2022, calculated as the difference between the aggregate consideration received (including cash and forgiveness of the remaining financing obligation of $84 million) and the carrying value of the distribution center. The gain is included in gain on sale of fixed assets in the condensed consolidated statement of operations. The Company accounted for the modified lease as an operating lease and recorded a $37 million right-of-use asset and a $31 million operating lease liability, with the difference attributable to prepaid rent. In July 2022, QVC sold five owned and operated properties located in the U.S. to an independent third party and received net cash proceeds of $443 million. Concurrent with the sale, the Company entered into agreements to lease each of the properties back from the purchaser over an initial term of 20 years with the option to extend the terms of the property leases for up to four consecutive terms of five years. QVC recognized a $277 million gain related to the successful sale leaseback for the three and nine months ended September 30, 2022 calculated as the difference between the aggregate consideration received and the carrying value of the properties. The Company accounted for the leases as operating leases and recorded a $207 million right-of-use asset and a $205 million operating lease liability, with the difference attributable to initial direct costs. |
Revenue (Notes)
Revenue (Notes) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | Revenue Disaggregated revenue by segment and product category consisted of the following: Three months ended September 30, 2022 Nine months ended September 30, 2022 (in millions) QxH QVC-International Total QxH QVC-International Total Home $ 621 208 829 1,950 729 2,679 Apparel 330 100 430 982 334 1,316 Beauty 252 129 381 766 419 1,185 Accessories 190 49 239 633 162 795 Electronics 152 20 172 411 71 482 Jewelry 73 45 118 231 139 370 Other revenue 45 3 48 128 8 136 Total net revenue $ 1,663 554 2,217 5,101 1,862 6,963 Three months ended September 30, 2021 Nine months ended September 30, 2021 (in millions) QxH QVC-International Total QxH QVC-International Total Home $ 679 272 951 2,229 905 3,134 Apparel 336 119 455 985 372 1,357 Beauty 279 164 443 859 521 1,380 Accessories 210 62 272 720 199 919 Electronics 171 24 195 539 89 628 Jewelry 95 55 150 269 169 438 Other revenue 43 3 46 137 9 146 Total net revenue $ 1,813 699 2,512 5,738 2,264 8,002 Consumer Product Revenue and Other Revenue QVC's revenue includes sales of consumer products in the following categories; home, apparel, beauty, accessories, electronics and jewelry, which are primarily sold through live merchandise-focused televised shopping programs and via our websites and other interactive media. Other revenue consists primarily of income generated from our U.S. Private Label Credit Card ("PLCC") in which a large consumer financial services company provides revolving credit directly to QVC's customers for the sole purpose of purchasing merchandise or services with a PLCC. In return, the Company receives a portion of the net economics of the credit card program. Revenue Recognition Revenue is recognized when obligations with our customers are satisfied; generally this occurs at the time of shipment to our customers consistent with when control of the shipped product passes. The recognized revenue reflects the consideration we expect to receive in exchange for transferring goods, net of allowances for returns. The Company generally recognizes revenue related to the PLCC program over time as the PLCC is used by QVC's customers. Sales, value add, use and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The Company elected to treat shipping and handling activities that occur after the customer obtains control of the goods as a fulfillment cost and not as a promised good or service. Accordingly, the Company accrues the related shipping costs and recognizes revenue upon delivery of the goods to the shipping carrier. In electing this accounting policy, all shipping and handling activities will be treated as fulfillment costs. The Company generally extends payment terms with its customers of one year or less and does not consider the time value of money when recognizing revenue. Significant Judgments |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income Taxes The Company calculates its interim income tax provision by applying its best estimate of the annual expected effective tax rate to its ordinary year-to-date income or loss. The tax or benefit related to significant, unusual or extraordinary items that will be separately reported or reported net of their related tax effect are individually computed and recognized in the interim period in which those items occur. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and significant judgments including, but not limited to, the expected operating income for the year, projections of the proportion of income earned and taxed in foreign jurisdictions, permanent and temporary differences as a result of differences between amounts measured and recognized in accordance with tax laws and financial accounting standards, and the likelihood of recovering deferred tax assets. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as the tax environment changes. To the extent that the estimated annual effective tax rate changes during a quarter, the effect of the change on the prior quarters is included in the tax expense for the current quarter. For the three months ended September 30, 2022 and 2021, the Company recorded a tax provision of $101 million and $85 million, respectively, which represented an effective tax rate of (4.8)% and 34.7%, respectively. For the nine months ended September 30, 2022 and 2021, the Company recorded a tax provision of $251 million and $266 million, respectively, which represented an effective tax rate of (15.5)% and 28.9%, respectively. The 2022 rate differs from the U.S. federal income tax rate of 21% primarily due to the goodwill impairment loss of $2,420 million that is not deductible for tax purposes. Excluding the goodwill impairment loss, our effective tax rate would be 32.9% and 31.5% for the three and nine months ended September 30, 2022, respectively, compared to an effective tax rate of 34.7% and 28.9% for the three and nine months ended September 30, 2021, respectively. The 2022 rate excluding goodwill impairment loss differs from the U.S. federal income tax rate of 21% due primarily to state and foreign tax expenses, and changes in valuation allowances. The Company participates in a consolidated federal return filing with Qurate Retail. As of September 30, 2022, the Company's tax years through 2018 are closed for federal income tax purposes, and the Internal Revenue Service ("IRS") has completed its examination of the Company's 2019 and 2020 tax years. The Company's 2021 and 2022 tax years are being examined currently as part of the Qurate Retail consolidated return under the IRS's Compliance Assurance Process program. The Company, or one of its subsidiaries, files income tax returns in various states and foreign jurisdictions. As of September 30, 2022, the Company was under examination in Colorado, Florida, Maine, Minnesota, New Jersey, Pennsylvania, New York City, and the U.K. The Company is a party to a Tax Liability Allocation and Indemnification Agreement (the “Tax Agreement”) with Qurate Retail. The Tax Agreement establishes the methodology for the calculation and payment of income taxes in connection with the consolidation of the Company with Qurate Retail for income tax purposes. Generally, the Tax Agreement provides that the Company will pay Qurate Retail an amount equal to the tax liability, if any, that it would have if it were to file as a consolidated group separate and apart from Qurate Retail, with exceptions for the treatment and timing of certain items, including but not limited to deferred intercompany transactions, credits, and net operating and capital losses. To the extent that the separate company tax expense is different from the payment terms of the Tax Agreement, the difference is recorded as either a dividend or capital contribution. The amounts of the tax-related payable due to Qurate Retail as of September 30, 2022 and December 31, 2021 were $95 million and $85 million, respectively, and were included in accrued liabilities in the accompanying condensed consolidated balance sheets. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies The Company has contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. Although it is reasonably possible the Company may incur losses upon conclusion of such matters, an estimate of any loss or range of loss cannot be made. In the opinion of management, it is expected that the amounts, if any, which may be required to satisfy such contingencies will not be material in relation to the accompanying condensed consolidated financial statements. Network and information systems, including the Internet and telecommunication systems, third party delivery services and other technologies are critical to QVC's business activities. Substantially all of QVC's customer orders, fulfillment and delivery services are dependent upon the use of network and information systems, including the use of third party telecommunication and delivery service providers. If information systems including the Internet or telecommunication services are disrupted, or if the third party delivery services experience a disruption in their transportation delivery services, the Company could face a significant disruption in fulfilling QVC's customer orders and shipment of QVC's products. The Company has active disaster recovery programs in place to help mitigate risks associated with these critical business activities. |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair value disclosures | Financial Instruments and Fair Value Measurements For assets and liabilities required to be reported or disclosed at fair value, U.S. GAAP provides a hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three broad levels. Level 1 inputs are quoted market prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs, other than quoted market prices included within Level 1, are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. The Company measures the fair value of money market funds based on quoted prices in active markets for identical assets. Money market funds are included as cash equivalents Level 1 fair value instruments in the table below. The 2067 Notes (ticker: QVCD) and the 2068 Notes (ticker: QVCC) are traded on the New York Stock Exchange, which the Company considers to be an "active market," as defined by U.S. GAAP. Therefore, these Notes are measured based on quoted prices in an active market and included as Level 1 fair value instruments in the table below. The remainder of the Company's debt instruments and derivative instruments are considered Level 2 fair value instruments and measured based on quoted market prices that are not considered to be traded on "active markets." Accordingly, these financial instruments are reported in the below tables as Level 2 fair value instruments. The Company's assets and liabilities measured or disclosed at fair value were as follows: Fair value measurements at September 30, 2022 using (in millions) Total Quoted prices Significant Significant Current assets: Cash equivalents $ 233 233 — — Current liabilities: Debt (note 5) 213 — 213 — Long-term liabilities: Debt (note 5) 3,360 555 2,805 — Fair value measurements at December 31, 2021 using (in millions) Total Quoted prices Significant Significant Current assets: Cash equivalents $ 124 124 — — Current liabilities: Interest rate swap arrangements (note 5) 1 — 1 — Long-term liabilities: Debt (note 5) 5,076 745 4,331 — |
Information about QVC's Operati
Information about QVC's Operating Segments | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
Segment reporting disclosure | Information about QVC's Operating Segments The Company evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as net revenue, Adjusted OIBDA (defined below), gross margin, average sales price per unit, number of units shipped and revenue or sales per customer. For segment reporting purposes, the Company defines Adjusted OIBDA, as net revenue less cost of goods sold (excluding Fire related costs, net of recoveries and Rocky Mount inventory losses, see note 13), operating expenses, and selling, general and administrative expenses (excluding stock-based compensation). The Company believes this measure is an important indicator of the operational strength and performance of its segments by identifying those items that are not directly a reflection of each segment's performance or indicative of ongoing business trends. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking among the Company's businesses and identify strategies to improve performance. This measure of performance excludes depreciation, amortization, impairment losses, Gains on sales of fixed assets, Fire related costs, net of recoveries and Rocky Mount inventory losses and stock-based compensation that are included in the measurement of operating income pursuant to U.S. GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flow provided by operating activities and other measures of financial performance prepared in accordance with U.S. GAAP. The Company's chief operating decision maker ("CODM") is QVC's Chief Executive Officer. QVC's CODM has ultimate responsibility for enterprise decisions. QVC's CODM determines, in particular, resource allocation for, and monitors performance of, the consolidated enterprise, QxH, and QVC-International. The segment managers have responsibility for operating decisions, allocating resources and assessing performance within their respective segments. QVC's CODM relies on internal management reporting that analyzes enterprise results and segment results to the Adjusted OIBDA level. For the three and nine months ended September 30, 2022 and 2021, QVC identified QxH and QVC-International as its two reportable segments. Both operating segments are retailers of a wide range of consumer products, which are marketed and sold primarily by merchandise-focused televised-shopping programs as well as via the Internet and mobile applications in certain markets. Performance measures Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 (in millions) Net Adjusted Net Adjusted Net Adjusted Net Adjusted QxH $ 1,663 143 1,813 325 5,101 600 5,738 1,065 QVC-International 554 62 699 115 1,862 261 2,264 402 Consolidated QVC $ 2,217 205 2,512 440 6,963 861 8,002 1,467 Other information Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 (in millions) Depreciation Amortization Depreciation Amortization Depreciation Amortization Depreciation Amortization QxH $ 17 70 24 70 62 207 74 190 QVC-International 4 3 13 4 26 10 41 10 Consolidated QVC $ 21 73 37 74 88 217 115 200 September 30, 2022 (in millions) Total Capital Property and equipment, net QxH $ 10,675 116 272 QVC-International 1,767 19 232 Consolidated QVC $ 12,442 135 504 The following table provides a reconciliation of Adjusted OIBDA to operating income and income before income taxes: Three months ended September 30, Nine months ended September 30, (in millions) 2022 2021 2022 2021 Adjusted OIBDA $ 205 440 861 1,467 Gains on sales of fixed assets 277 — 520 — Fire related costs, net of recoveries and Rocky Mount inventory losses (see note 13) 137 — 39 — Impairment losses (2,600) — (2,600) — Stock-based compensation (9) (13) (27) (33) Depreciation and amortization (94) (111) (305) (315) Operating (loss) income (2,084) 316 (1,512) 1,119 Equity in losses of investee — (2) — (2) (Losses) gains on financial instruments — (5) 1 (8) Interest expense, net (50) (64) (175) (192) Foreign currency gain (loss) 21 — 50 (4) Loss on extinguishment of debt — — (6) — Other income — — 20 8 (Loss) income before income taxes $ (2,113) 245 (1,622) 921 |
Other Comprehensive Income
Other Comprehensive Income | 9 Months Ended |
Sep. 30, 2022 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Comprehensive Income (Loss) | Other Comprehensive Income The change in the components of accumulated other comprehensive loss, net of taxes ("AOCL"), is summarized as follows: (in millions) Comprehensive earnings attributable to debt credit risk adjustments Foreign currency translation adjustments AOCL Balance at January 1, 2022 $ — (146) (146) Other comprehensive loss attributable to QVC, Inc. stockholder — (305) (305) Balance at September 30, 2022 — (451) (451) Balance at January 1, 2021 $ 16 (33) (17) Other comprehensive loss attributable to QVC, Inc. stockholder (19) (82) (101) Balance at September 30, 2021 (3) (115) (118) The components of other comprehensive loss are reflected in QVC's condensed consolidated statements of comprehensive income, net of taxes. The following table summarizes the tax effects related to the components of other comprehensive loss: (in millions) Before-tax amount Tax benefit (expense) Net-of-tax amount Three months ended September 30, 2022 Foreign currency translation adjustments $ (131) 4 (127) Other comprehensive loss (131) 4 (127) Three months ended September 30, 2021 Foreign currency translation adjustments $ (27) (1) (28) Debt credit risk adjustment (7) — (7) Other comprehensive loss (34) (1) (35) Nine months ended September 30, 2022 Foreign currency translation adjustments $ (337) 7 (330) Other comprehensive loss (337) 7 (330) Nine months ended September 30, 2021 Foreign currency translation adjustments $ (89) (3) (92) Debt credit risk adjustment (19) — (19) Other comprehensive loss (108) (3) (111) |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2022 | |
Subsequent Event [Line Items] | |
Subsequent Events [Text Block] | Subsequent Events On November 2, 2022 and November 3, 2022, QVC entered into agreements to sell two properties located in Germany and the U.K. to an independent third party. Under the terms of the agreements, QVC will receive cash payments of approximately €97 million related to its German facility and approximately £68 million related to its U.K. facility before fees, taxes and other expenses. The sale is expected to close in the first quarter of fiscal year 2023. Contingent on the closing of the sale, the Company entered into agreements to lease each of the properties back from the purchaser over an initial term of 20 years with the option to extend the terms of the property leases for up to four consecutive terms of five years. QVC expects to record a gain in 2023 at the close of the sale leaseback transaction. |
Revenue Revenue (Policies)
Revenue Revenue (Policies) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue [Policy Text Block] | Revenue Recognition Revenue is recognized when obligations with our customers are satisfied; generally this occurs at the time of shipment to our customers consistent with when control of the shipped product passes. The recognized revenue reflects the consideration we expect to receive in exchange for transferring goods, net of allowances for returns. The Company generally recognizes revenue related to the PLCC program over time as the PLCC is used by QVC's customers. Sales, value add, use and other taxes the Company collects concurrent with revenue-producing activities are excluded from revenue. The Company elected to treat shipping and handling activities that occur after the customer obtains control of the goods as a fulfillment cost and not as a promised good or service. Accordingly, the Company accrues the related shipping costs and recognizes revenue upon delivery of the goods to the shipping carrier. In electing this accounting policy, all shipping and handling activities will be treated as fulfillment costs. The Company generally extends payment terms with its customers of one year or less and does not consider the time value of money when recognizing revenue. Significant Judgments |
Television Distribution Right_2
Television Distribution Rights, Net (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Television Distribution Rights [Abstract] | |
Schedule of television distribution rights | Television distribution rights consisted of the following: (in millions) September 30, 2022 December 31, 2021 Television distribution rights $ 723 818 Less accumulated amortization (628) (673) Television distribution rights, net $ 95 145 |
Schedule of future amortization expense | As of September 30, 2022, related amortization expense for each of the next five years ended December 31 was as follows (in millions): Remainder of 2022 $ 30 2023 51 2024 13 2025 1 2026 — |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The changes in the carrying amount of goodwill by operating segment for the nine months ended September 30, 2022 were as follows: (in millions) QxH QVC-International Total Balance as of December 31, 2021 $ 5,112 856 5,968 Impairment (2,420) — (2,420) Exchange rate fluctuations — (149) (149) Balance as of September 30, 2022 $ 2,692 707 3,399 |
Schedule of acquired intangible assets by class | Other intangible assets consisted of the following: September 30, 2022 December 31, 2021 (in millions) Gross Accumulated Other intangible assets, net Gross Accumulated Other intangible assets, net Purchased and internally developed software $ 1,014 (730) 284 945 (659) 286 Affiliate and customer relationships 2,802 (2,603) 199 2,832 (2,598) 234 Debt origination fees 9 (2) 7 9 — 9 Trademarks (indefinite life) 2,698 — 2,698 2,878 — 2,878 $ 6,523 (3,335) 3,188 6,664 (3,257) 3,407 |
Schedule of finite-lived intangible assets future amortization expense | As of September 30, 2022, the related amortization and interest expense for each of the next five years ended December 31 was as follows (in millions): Remainder of 2022 $ 50 2023 181 2024 136 2025 75 2026 48 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Accrued Liabilities [Abstract] | |
Schedule of accrued liabilities | Accrued liabilities consisted of the following: (in millions) September 30, 2022 December 31, 2021 Accounts payable non-trade $ 334 364 Allowance for sales returns 139 242 Accrued compensation and benefits 108 151 Income taxes 103 132 Other 221 290 $ 905 1,179 Other long-term liabilities consisted of the following: (in millions) September 30, 2022 December 31, 2021 Operating lease liability $ 379 177 Other 133 117 512 294 |
Other Liabilities | Other long-term liabilities consisted of the following: (in millions) September 30, 2022 December 31, 2021 Operating lease liability $ 379 177 Other 133 117 512 294 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of debt | Long-term debt and finance lease obligations consisted of the following: (in millions) September 30, 2022 December 31, 2021 4.375% Senior Secured Notes due 2023, net of original issue discount $ 214 750 4.85% Senior Secured Notes due 2024, net of original issue discount 600 600 4.45% Senior Secured Notes due 2025, net of original issue discount 599 599 4.75% Senior Secured Notes due 2027 575 575 4.375% Senior Secured Notes due 2028 500 500 5.45% Senior Secured Notes due 2034, net of original issue discount 399 399 5.95% Senior Secured Notes due 2043, net of original issue discount 300 300 6.375% Senior Secured Notes due 2067 225 225 6.25% Senior Secured Notes due 2068 500 500 Senior secured credit facility (1) 505 481 Finance lease obligations (note 6) 5 157 Less debt issuance costs, net (38) (43) Total debt and finance lease obligations 4,384 5,043 Less current portion (216) (20) Long-term portion of debt and finance lease obligations $ 4,168 5,023 (1) Includes $261 million and $151 million of Zulily's outstanding borrowings as of September 30, 2022 and December 31, 2021, respectively. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Disaggregated revenue by segment and product category consisted of the following: Three months ended September 30, 2022 Nine months ended September 30, 2022 (in millions) QxH QVC-International Total QxH QVC-International Total Home $ 621 208 829 1,950 729 2,679 Apparel 330 100 430 982 334 1,316 Beauty 252 129 381 766 419 1,185 Accessories 190 49 239 633 162 795 Electronics 152 20 172 411 71 482 Jewelry 73 45 118 231 139 370 Other revenue 45 3 48 128 8 136 Total net revenue $ 1,663 554 2,217 5,101 1,862 6,963 Three months ended September 30, 2021 Nine months ended September 30, 2021 (in millions) QxH QVC-International Total QxH QVC-International Total Home $ 679 272 951 2,229 905 3,134 Apparel 336 119 455 985 372 1,357 Beauty 279 164 443 859 521 1,380 Accessories 210 62 272 720 199 919 Electronics 171 24 195 539 89 628 Jewelry 95 55 150 269 169 438 Other revenue 43 3 46 137 9 146 Total net revenue $ 1,813 699 2,512 5,738 2,264 8,002 |
Financial Instruments and Fai_2
Financial Instruments and Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value, assets and liabilities measured on recurring basis | The Company's assets and liabilities measured or disclosed at fair value were as follows: Fair value measurements at September 30, 2022 using (in millions) Total Quoted prices Significant Significant Current assets: Cash equivalents $ 233 233 — — Current liabilities: Debt (note 5) 213 — 213 — Long-term liabilities: Debt (note 5) 3,360 555 2,805 — Fair value measurements at December 31, 2021 using (in millions) Total Quoted prices Significant Significant Current assets: Cash equivalents $ 124 124 — — Current liabilities: Interest rate swap arrangements (note 5) 1 — 1 — Long-term liabilities: Debt (note 5) 5,076 745 4,331 — |
Information about QVC's Opera_2
Information about QVC's Operating Segments (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Revenue and Adjusted OIBDA by Segment | Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 (in millions) Net Adjusted Net Adjusted Net Adjusted Net Adjusted QxH $ 1,663 143 1,813 325 5,101 600 5,738 1,065 QVC-International 554 62 699 115 1,862 261 2,264 402 Consolidated QVC $ 2,217 205 2,512 440 6,963 861 8,002 1,467 |
Schedule of Depreciation and Amortization by Segment | Three months ended September 30, Nine months ended September 30, 2022 2021 2022 2021 (in millions) Depreciation Amortization Depreciation Amortization Depreciation Amortization Depreciation Amortization QxH $ 17 70 24 70 62 207 74 190 QVC-International 4 3 13 4 26 10 41 10 Consolidated QVC $ 21 73 37 74 88 217 115 200 |
Schedule of Capital Expenditures and Total Assets by Segment | September 30, 2022 (in millions) Total Capital Property and equipment, net QxH $ 10,675 116 272 QVC-International 1,767 19 232 Consolidated QVC $ 12,442 135 504 |
Reconciliation of Adjusted OIBDA to Income before Income Taxes | The following table provides a reconciliation of Adjusted OIBDA to operating income and income before income taxes: Three months ended September 30, Nine months ended September 30, (in millions) 2022 2021 2022 2021 Adjusted OIBDA $ 205 440 861 1,467 Gains on sales of fixed assets 277 — 520 — Fire related costs, net of recoveries and Rocky Mount inventory losses (see note 13) 137 — 39 — Impairment losses (2,600) — (2,600) — Stock-based compensation (9) (13) (27) (33) Depreciation and amortization (94) (111) (305) (315) Operating (loss) income (2,084) 316 (1,512) 1,119 Equity in losses of investee — (2) — (2) (Losses) gains on financial instruments — (5) 1 (8) Interest expense, net (50) (64) (175) (192) Foreign currency gain (loss) 21 — 50 (4) Loss on extinguishment of debt — — (6) — Other income — — 20 8 (Loss) income before income taxes $ (2,113) 245 (1,622) 921 |
Other Comprehensive Income (Tab
Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2022 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The change in the components of accumulated other comprehensive loss, net of taxes ("AOCL"), is summarized as follows: (in millions) Comprehensive earnings attributable to debt credit risk adjustments Foreign currency translation adjustments AOCL Balance at January 1, 2022 $ — (146) (146) Other comprehensive loss attributable to QVC, Inc. stockholder — (305) (305) Balance at September 30, 2022 — (451) (451) Balance at January 1, 2021 $ 16 (33) (17) Other comprehensive loss attributable to QVC, Inc. stockholder (19) (82) (101) Balance at September 30, 2021 (3) (115) (118) |
Schedule of Component of Comprehensive Income (Loss) | The components of other comprehensive loss are reflected in QVC's condensed consolidated statements of comprehensive income, net of taxes. The following table summarizes the tax effects related to the components of other comprehensive loss: (in millions) Before-tax amount Tax benefit (expense) Net-of-tax amount Three months ended September 30, 2022 Foreign currency translation adjustments $ (131) 4 (127) Other comprehensive loss (131) 4 (127) Three months ended September 30, 2021 Foreign currency translation adjustments $ (27) (1) (28) Debt credit risk adjustment (7) — (7) Other comprehensive loss (34) (1) (35) Nine months ended September 30, 2022 Foreign currency translation adjustments $ (337) 7 (330) Other comprehensive loss (337) 7 (330) Nine months ended September 30, 2021 Foreign currency translation adjustments $ (89) (3) (92) Debt credit risk adjustment (19) — (19) Other comprehensive loss (108) (3) (111) |
Basis of Presentation (Details)
Basis of Presentation (Details) - USD ($) $ in Millions | 9 Months Ended | ||||||
Sep. 30, 2022 | Sep. 30, 2021 | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 | Dec. 30, 2020 | |
General business information | |||||||
Dividends paid to noncontrolling interest | $ 39 | $ 46 | |||||
Note receivable - related party (note 1) | $ 1,740 | $ 1,740 | $ 1,800 | ||||
Receivable with Imputed Interest, Effective Yield (Interest Rate) | 0.48% | ||||||
Interest Income, Related Party | $ 6 | ||||||
Property, Plant and Equipment, Net | 504 | 919 | |||||
Deferred Income Tax Liabilities, Net | 580 | 633 | |||||
Total equity | 5,228 | 8,224 | $ 7,652 | 7,721 | $ 8,190 | $ 8,091 | |
Accumulated deficit | |||||||
General business information | |||||||
Total equity | $ (5,019) | (2,552) | $ (2,751) | (2,942) | $ (2,605) | $ (2,766) | |
Revision of Prior Period, Adjustment | |||||||
General business information | |||||||
Property, Plant and Equipment, Net | 47 | ||||||
Deferred Income Tax Liabilities, Net | 3 | ||||||
Revision of Prior Period, Adjustment | Accumulated deficit | |||||||
General business information | |||||||
Total equity | $ 44 | ||||||
QVC-Japan | |||||||
General business information | |||||||
Investment Owned, Percent of Net Assets | 60% | ||||||
QVC-Japan | Mitsui [Domain] | |||||||
General business information | |||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 40% | ||||||
QVC to Zulily allocated expenses [Member] | zulily, llc [Member] | |||||||
General business information | |||||||
Related Party Transaction, Amounts of Transaction | $ 3 | 6 | |||||
Zulily to QVC allocated expenses [Member] | zulily, llc [Member] | |||||||
General business information | |||||||
Related Party Transaction, Amounts of Transaction | 6 | 6 | |||||
QVC to CBI Allocated Expenses [Member] | Cornerstone Brands Inc [Member] | |||||||
General business information | |||||||
Related Party Transaction, Expenses from Transactions with Related Party | 22 | 16 | |||||
CBI to QVC allocated expenses [Member] | Cornerstone Brands Inc [Member] | |||||||
General business information | |||||||
Related Party Transaction, Expenses from Transactions with Related Party | 1 | $ 1 | |||||
QVC to Zulily loan [Member] | zulily, llc [Member] | |||||||
General business information | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 100 | ||||||
Line of Credit Facility, Interest Rate Description | variable interest rate equal to the LIBOR rate plus an applicable margin rate |
Television Distribution Right_3
Television Distribution Rights, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Television distribution rights, net | $ 95 | $ 95 | $ 145 | ||
Television distribution rights | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Television distribution rights | 723 | 723 | 818 | ||
Less accumulated amortization | (628) | (628) | (673) | ||
Television distribution rights, net | 95 | 95 | $ 145 | ||
Amortization | $ 29 | $ 32 | $ 88 | $ 80 |
Television Distribution Right_4
Television Distribution Rights, Net (Future Amortization Expense) (Details) - Television distribution rights $ in Millions | Sep. 30, 2022 USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
Remainder of 2022 | $ 30 |
2023 | 51 |
2024 | 13 |
2025 | 1 |
2026 | $ 0 |
Intangible Assets, Goodwill and
Intangible Assets, Goodwill and Other (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Goodwill [Line Items] | |||||
Balance as of December 31, 2021 | $ 5,968 | ||||
Impairment | (2,420) | ||||
Exchange rate fluctuations | (149) | ||||
Balance as of September 30, 2022 | $ 3,399 | 3,399 | |||
Gross cost | |||||
Purchased and internally developed software | 1,014 | 1,014 | $ 945 | ||
Affiliate and customer relationships | 2,802 | 2,802 | 2,832 | ||
Debt origination fees | 9 | 9 | 9 | ||
Trademarks (indefinite life) | 2,698 | 2,698 | 2,878 | ||
Other intangible assets (excluding goodwill), gross | 6,523 | 6,523 | 6,664 | ||
Accumulated amortization | |||||
Purchased and internally developed software | (730) | (730) | (659) | ||
Affiliate and customer relationships | (2,603) | (2,603) | (2,598) | ||
Debt origination fees | (2) | (2) | 0 | ||
Other intangible assets (excluding goodwill), accumulated amortization | (3,335) | (3,335) | (3,257) | ||
Other intangible assets, net | |||||
Purchased and internally developed software | 284 | 284 | 286 | ||
Affiliate and customer relationships | 199 | 199 | 234 | ||
Debt origination fees | 7 | 7 | 9 | ||
Other intangible assets (excluding goodwill), net | 3,188 | 3,188 | $ 3,407 | ||
Indefinite-Lived Intangible Assets [Line Items] | |||||
Amortization of other intangible assets | 44 | $ 42 | $ 129 | $ 120 | |
Document Period End Date | Sep. 30, 2022 | ||||
HSN Tradename | |||||
Indefinite-Lived Intangible Assets [Line Items] | |||||
Impairment of Intangible Assets (Excluding Goodwill) | $ 180 | ||||
Intangible Asset, Impaired, Accumulated Impairment Loss | 357 | 357 | |||
QxH [Member] | |||||
Goodwill [Line Items] | |||||
Balance as of December 31, 2021 | 5,112 | ||||
Impairment | (2,420) | ||||
Exchange rate fluctuations | 0 | ||||
Balance as of September 30, 2022 | 2,692 | 2,692 | |||
Goodwill, Impaired, Accumulated Impairment Loss | 2,420 | 2,420 | |||
QVC-International | |||||
Goodwill [Line Items] | |||||
Balance as of December 31, 2021 | 856 | ||||
Impairment | 0 | ||||
Exchange rate fluctuations | (149) | ||||
Balance as of September 30, 2022 | 707 | 707 | |||
Other Intangible Assets | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Remainder of 2022 | 50 | 50 | |||
2023 | 181 | 181 | |||
2024 | 136 | 136 | |||
2025 | 75 | 75 | |||
2026 | $ 48 | $ 48 |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Accrued Liabilities [Abstract] | ||
Accounts payable non-trade | $ 334 | $ 364 |
Allowance for sales returns | 139 | 242 |
Accrued compensation and benefits | 108 | 151 |
Other | 221 | 290 |
Accrued liabilities | 905 | 1,179 |
Accrued Income Taxes, Current | $ 103 | 132 |
Document Period End Date | Sep. 30, 2022 | |
Operating Lease, Liability, Noncurrent | $ 379 | 177 |
Other Accrued Liabilities, Noncurrent | 133 | 117 |
Other long-term liabilities (note 4) | $ 512 | $ 294 |
Long-Term Debt (Debt) (Details)
Long-Term Debt (Debt) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 | Jul. 01, 2019 |
Debt Instrument [Line Items] | |||
Derivative, Notional Amount | $ 125 | ||
Debt Issuance Costs, Noncurrent, Net | $ (38) | $ (43) | |
Total debt and finance lease obligations | 4,384 | 5,043 | |
Debt, Current | (216) | (20) | |
Long-term Debt, Excluding Current Maturities | 4,168 | 5,023 | |
Zulily, llc | |||
Debt Instrument [Line Items] | |||
Obligation with Joint and Several Liability Arrangement, Amount Outstanding | 261 | 151 | |
Cornerstone Brands Inc [Member] | |||
Debt Instrument [Line Items] | |||
Obligation with Joint and Several Liability Arrangement, Amount Outstanding | $ 40 | ||
4.375% Senior Secured Notes due 2023, net of original issue discount | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.375% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 214 | 750 | |
4.85% Senior Secured Notes due 2024, net of original issue discount | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.85% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 600 | 600 | |
4.45% Senior Secured Notes due 2025, net of original issue discount | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.45% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 599 | 599 | |
4.75% Senior Secured Notes | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.75% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 575 | 575 | |
4.375% Senior Secured Notes due 2028 | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 4.375% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 500 | 500 | |
5.45% Senior Secured Notes due 2034, net of original issue discount | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 5.45% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 399 | 399 | |
5.95% Senior Secured Notes due 2043, net of original issue discount | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 5.95% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 300 | 300 | |
6.375% Senior Secured Notes [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 6.375% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 225 | 225 | |
6.25% Senior Secured Notes [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Interest Rate, Stated Percentage | 6.25% | ||
Debt Instrument Net of Unamortized Discounts Premium | $ 500 | 500 | |
Revolving Credit Facility [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument Net of Unamortized Discounts Premium | 505 | 481 | |
Finance lease obligations (note 6) | |||
Debt Instrument [Line Items] | |||
Finance Lease, Liability | $ 5 | $ 157 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | Oct. 27, 2021 | Jul. 01, 2019 | |
Debt Instrument [Line Items] | |||||||
Repayments of Secured Debt | $ 536,000,000 | $ 0 | |||||
Gain (Loss) on Extinguishment of Debt | $ 0 | $ 0 | (6,000,000) | $ 0 | |||
Common control transaction with Qurate Retail, Inc. | 34,000,000 | 110,000,000 | |||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 2,680,000,000 | $ 2,680,000,000 | |||||
Line of Credit Facility, Interest Rate at Period End | 4.50% | 4.50% | |||||
Document Period End Date | Sep. 30, 2022 | ||||||
Derivative Asset, Current | $ 1,000,000 | $ 1,000,000 | |||||
Derivative, Notional Amount | $ 125,000,000 | ||||||
Debt, Weighted Average Interest Rate | 5% | 5% | |||||
Additional paid-in capital | |||||||
Debt Instrument [Line Items] | |||||||
Common control transaction with Qurate Retail, Inc. | $ 34,000,000 | $ 110,000,000 | |||||
Zulily, llc | |||||||
Debt Instrument [Line Items] | |||||||
Obligation with Joint and Several Liability Arrangement, Amount Outstanding | $ 261,000,000 | $ 261,000,000 | $ 151,000,000 | ||||
6.375% Senior Secured Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.375% | 6.375% | |||||
6.25% Senior Secured Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Interest Rate, Stated Percentage | 6.25% | 6.25% | |||||
Revolving Credit Facility [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 3,250,000,000 | ||||||
Revolving Credit Facility [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||||||
Revolving Credit Facility [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 1.625% | ||||||
Revolving Credit Facility [Member] | ABR Rate | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | ||||||
Revolving Credit Facility [Member] | ABR Rate | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, Basis Spread on Variable Rate | 0.625% | ||||||
Standby Letters of Credit | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | 450,000,000 | ||||||
Alternative Currency Borrowings | |||||||
Debt Instrument [Line Items] | |||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 0.50 |
Lease and Transponder Service_2
Lease and Transponder Service Agreements (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Lessee, Lease, Description [Line Items] | ||||
Sale and Leaseback Transaction, Gain (Loss), Net | $ 277 | $ 240 | ||
Operating Lease, Right-of-Use Asset | 420 | 420 | $ 201 | |
Proceeds from Sale of Property, Plant, and Equipment | 443 | |||
Ontario Distribution Center | ||||
Lessee, Lease, Description [Line Items] | ||||
Finance Lease, Liability | $ 84 | |||
Operating Lease, Right-of-Use Asset | 37 | |||
Operating Lease, Liability | $ 31 | |||
US Portfolio Properties | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating Lease, Right-of-Use Asset | 207 | 207 | ||
Operating Lease, Liability | $ 205 | $ 205 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 2,217 | $ 2,512 | $ 6,963 | $ 8,002 |
Home | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 829 | 951 | 2,679 | 3,134 |
Apparel [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 430 | 455 | 1,316 | 1,357 |
Beauty [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 381 | 443 | 1,185 | 1,380 |
Accessories | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 239 | 272 | 795 | 919 |
Jewelry | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 118 | 150 | 370 | 438 |
Electronics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 172 | 195 | 482 | 628 |
Other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 48 | 46 | 136 | 146 |
QxH [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,663 | 1,813 | 5,101 | 5,738 |
QxH [Member] | Home | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 621 | 679 | 1,950 | 2,229 |
QxH [Member] | Apparel [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 330 | 336 | 982 | 985 |
QxH [Member] | Beauty [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 252 | 279 | 766 | 859 |
QxH [Member] | Accessories | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 190 | 210 | 633 | 720 |
QxH [Member] | Jewelry | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 73 | 95 | 231 | 269 |
QxH [Member] | Electronics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 152 | 171 | 411 | 539 |
QxH [Member] | Other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 45 | 43 | 128 | 137 |
QVC-International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 554 | 699 | 1,862 | 2,264 |
QVC-International | Home | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 208 | 272 | 729 | 905 |
QVC-International | Apparel [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 100 | 119 | 334 | 372 |
QVC-International | Beauty [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 129 | 164 | 419 | 521 |
QVC-International | Accessories | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 49 | 62 | 162 | 199 |
QVC-International | Jewelry | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 45 | 55 | 139 | 169 |
QVC-International | Electronics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 20 | 24 | 71 | 89 |
QVC-International | Other revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 3 | $ 3 | $ 8 | $ 9 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Income Tax Contingency [Line Items] | |||||
Income tax expense | $ (101) | $ (85) | $ (251) | $ (266) | |
Effective Income Tax Rate Reconciliation, Percent | (4.80%) | 34.70% | (15.50%) | 28.90% | |
Goodwill, Impairment Loss | $ 2,420 | ||||
Effective Income Tax Rate Excluding Goodwill Impairment | 32.90% | 31.50% | |||
UNITED STATES | |||||
Income Tax Contingency [Line Items] | |||||
Effective income tax rate reconciliation, at federal statutory income tax rate, percent | 21% | ||||
Liberty | Tax Agreement | |||||
Income Tax Contingency [Line Items] | |||||
Current tax payments due to related parties | $ 95 | $ 95 | $ 85 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements (Details) - Recurring - USD ($) $ in Millions | Sep. 30, 2022 | Dec. 31, 2021 |
Current Assets, Fair Value Disclosure | ||
Cash equivalents | $ 233 | $ 124 |
Short-term Debt, Fair Value | 213 | 1 |
Long-term liabilities | ||
Long-term Debt, Fair Value | 3,360 | 5,076 |
Level 1 | ||
Current Assets, Fair Value Disclosure | ||
Cash equivalents | 233 | 124 |
Long-term liabilities | ||
Long-term Debt, Fair Value | 555 | 745 |
Level 2 | ||
Current Assets, Fair Value Disclosure | ||
Short-term Debt, Fair Value | 213 | 1 |
Long-term liabilities | ||
Long-term Debt, Fair Value | $ 2,805 | $ 4,331 |
Information about QVC's Opera_3
Information about QVC's Operating Segments (Revenue and Adjusted OIBDA by Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Adjusted OIBDA Excluding Transaction Related Costs | $ 205 | $ 440 | $ 861 | $ 1,467 |
Revenues | 2,217 | 2,512 | 6,963 | 8,002 |
QxH [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted OIBDA Excluding Transaction Related Costs | 143 | 325 | 600 | 1,065 |
Revenues | 1,663 | 1,813 | 5,101 | 5,738 |
QVC-International | ||||
Segment Reporting Information [Line Items] | ||||
Adjusted OIBDA Excluding Transaction Related Costs | 62 | 115 | 261 | 402 |
Revenues | $ 554 | $ 699 | $ 1,862 | $ 2,264 |
Information about QVC's Opera_4
Information about QVC's Operating Segments (Depreciation/Amortization by Segment) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting Information [Line Items] | ||||
Depreciation | $ 21 | $ 37 | $ 88 | $ 115 |
Amortization | 73 | 74 | 217 | 200 |
QxH [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation | 17 | 24 | 62 | 74 |
Amortization | 70 | 70 | 207 | 190 |
QVC-International | ||||
Segment Reporting Information [Line Items] | ||||
Depreciation | 4 | 13 | 26 | 41 |
Amortization | $ 3 | $ 4 | $ 10 | $ 10 |
Information about QVC's Opera_5
Information about QVC's Operating Segments (Total Assets and Capital Expenditures by Segment) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Dec. 31, 2021 | |
Segment Reporting Information [Line Items] | ||
Total assets | $ 12,442 | $ 16,141 |
Capital expenditures | 135 | |
Property, Plant and Equipment, Net | 504 | $ 919 |
QxH [Member] | ||
Segment Reporting Information [Line Items] | ||
Total assets | 10,675 | |
Capital expenditures | 116 | |
Property, Plant and Equipment, Net | 272 | |
QVC-International | ||
Segment Reporting Information [Line Items] | ||
Total assets | 1,767 | |
Capital expenditures | 19 | |
Property, Plant and Equipment, Net | $ 232 |
Information about QVC's Opera_6
Information about QVC's Operating Segments (Reconciliation of Adjusted OIBDA to Income before Income Taxes) (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | |
Segment Reporting [Abstract] | ||||
Adjusted OIBDA Excluding Transaction Related Costs | $ 205 | $ 440 | $ 861 | $ 1,467 |
Gain (Loss) on Disposition of Assets | 277 | 0 | 520 | 0 |
Goodwill and Intangible Asset Impairment | (2,600) | 0 | (2,600) | 0 |
Stock-based compensation | (9) | (13) | (27) | (33) |
Depreciation and amortization | (94) | (111) | (305) | (315) |
Operating Income (Loss) | (2,084) | 316 | (1,512) | 1,119 |
Income (Loss) from Equity Method Investments | 0 | (2) | 0 | (2) |
Gain (Loss) on Derivative Instruments, Net, Pretax | 0 | (5) | 1 | (8) |
Interest expense, net | (50) | (64) | (175) | (192) |
Foreign currency gain (loss) | 21 | 0 | 50 | (4) |
Gain (Loss) on Extinguishment of Debt | 0 | 0 | (6) | 0 |
Other Income | 0 | 0 | 20 | 8 |
(Loss) income before income taxes | (2,113) | 245 | (1,622) | 921 |
Fire related costs, net and Rocky Mount inventory losses | ||||
Segment Reporting [Abstract] | ||||
Unusual or Infrequent Item, or Both, Net (Gain) Loss | 137 | 0 | 39 | 0 |
Segment Reporting Information [Line Items] | ||||
Unusual or Infrequent Item, or Both, Net (Gain) Loss | $ (137) | $ 0 | $ (39) | $ 0 |
Other Comprehensive Income (Acc
Other Comprehensive Income (Accumulated Other Comprehensive Income) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2022 | Sep. 30, 2021 | |
AOCL | ||
Beginning balance | $ (146) | $ (17) |
Ending balance | (451) | (118) |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated other comprehensive loss | (451) | (118) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | (305) | (101) |
Accumulated Other Comprehensive Income Loss Attributable To Debt Credit Risk Adjustment Member | ||
AOCL | ||
Beginning balance | 0 | 16 |
Ending balance | 0 | (3) |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated other comprehensive loss | 0 | (3) |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent | 0 | (19) |
Accumulated Foreign Currency Adjustment Attributable to Parent | ||
Foreign currency translation adjustments | ||
Beginning balance | (146) | (33) |
Other comprehensive loss attributable to QVC, Inc. stockholder | (305) | (82) |
Ending balance | (451) | (115) |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated Other Comprehensive Income (Loss), Foreign Currency Translation Adjustment, Net of Tax | (451) | (115) |
Other comprehensive loss attributable to QVC, Inc. stockholder | $ (305) | $ (82) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Nov. 03, 2022 | Nov. 02, 2022 | Sep. 30, 2022 | Sep. 30, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | |||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 2,680 | $ 2,680 | |||
Unusual or Infrequent Item, or Both, Insurance Proceeds | $ 280 | $ 100 | |||
Proceeds from Sale of Property, Plant, and Equipment | $ 443 | ||||
Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Proceeds from Sale of Property, Plant, and Equipment | $ 68 | $ 97 |
Unusual or Infrequently Occurri
Unusual or Infrequently Occurring Items (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2022 | Sep. 30, 2021 | Dec. 31, 2021 | |
Unusual or Infrequent Item, or Both [Line Items] | |||||
Unusual or Infrequent Item, or Both, Net of Insurance Proceeds | $ (137) | $ 0 | $ (134) | $ 0 | |
Estimated Insurance Recoveries | 47 | 47 | $ 229 | ||
Unusual or Infrequent Item, or Both, Insurance Proceeds | 280 | 100 | |||
Unusual or Infrequent Item, or Both, Loss, Gross | 147 | 250 | |||
Insured Event, Gain (Loss) | 139 | $ 0 | |||
QVC Rocky Mount Fire | |||||
Unusual or Infrequent Item, or Both [Line Items] | |||||
Insurance Settlements Receivable | $ 35 | 35 | $ 129 | ||
Inventory Write-down | $ 95 |