Target (TGT) 10-Q 21 Aug 17 2017 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jul. 29, 2017	Aug. 15, 2017
Document and Entity Information
Entity Registrant Name	TARGET CORP
Entity Central Index Key	27,419
Document Type	10-Q
Document Period End Date	Jul. 29, 2017
Amendment Flag	false
Current Fiscal Year End Date	--02-03
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		546,231,798
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q2

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions		3 Months Ended		6 Months Ended
		Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
Income Statement [Abstract]
Sales		$ 16,429	$ 16,169	$ 32,446	$ 32,364
Cost of sales (a)	[1]	11,419	11,172	22,618	22,421
Gross margin		5,010	4,997	9,828	9,943
Selling, general and administrative expenses		3,382	3,249	6,515	6,402
Depreciation and amortization (exclusive of depreciation included in cost of sales) (a)		514	500	1,022	981
Earnings from continuing operations before interest expense and income taxes		1,114	1,248	2,291	2,560
Net interest expense		135	307	278	722
Earnings from continuing operations before income taxes		979	941	2,013	1,838
Provision for income taxes		308	316	664	599
Net earnings from continuing operations		671	625	1,349	1,239
Discontinued operations, net of tax		1	55	4	73
Net earnings		$ 672	$ 680	$ 1,353	$ 1,312
Basic earnings per share
Continuing operations (in dollars per share)		$ 1.22	$ 1.07	$ 2.45	$ 2.10
Discontinued operations (in dollars per share)		0	0.09	0.01	0.12
Net earnings per share (in dollars per share)		1.22	1.17	2.45	2.22
Diluted earnings per share
Continuing operations (in dollars per share)		1.22	1.07	2.44	2.08
Discontinued operations (in dollars per share)		0	0.09	0.01	0.12
Net earnings per share (in dollars per share)		$ 1.22	$ 1.16	$ 2.44	$ 2.20
Weighted average common shares outstanding
Basic (in shares)		549.3	582.2	550.8	590.3
Dilutive impact of share-based awards (in shares)		2.6	4.6	2.8	5
Diluted (in shares)		551.9	586.8	553.6	595.3
Antidilutive shares (in shares)		5.2	0.2	3.6	0.1
Dividends declared per share (in dollars per share)		$ 0.62	$ 0.60	$ 1.22	$ 1.16
[1]	Refer to Note 3 for information about a reclassification of supply chain-related depreciation expense to cost of sales.

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
Statement of Comprehensive Income [Abstract]
Net earnings	$ 672	$ 680	$ 1,353	$ 1,312
Other comprehensive income
Pension and other benefit liabilities, net of taxes of $5, $3, $10 and $8	7	5	14	12
Currency translation adjustment and cash flow hedges, net of taxes of $1, $0, $1, and $1	3	0	8	5
Other comprehensive income	10	5	22	17
Comprehensive income	$ 682	$ 685	$ 1,375	$ 1,329

Consolidated Statements of Com4

Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
Statement of Comprehensive Income [Abstract]
Pension and other benefit liabilities, taxes	$ 5	$ 3	$ 10	$ 8
Currency translation adjustment and cash flow hedges, taxes	$ 1	$ 0	$ 2	$ 1

Consolidated Statements of Fina

Consolidated Statements of Financial Position - USD ($) $ in Millions	Jul. 29, 2017	Jan. 28, 2017	Jul. 30, 2016
Assets
Cash and cash equivalents	$ 2,291	$ 2,512	$ 1,480
Inventory	8,257	8,309	8,631
Assets of discontinued operations	19	69	83
Other current assets	1,053	1,100	1,309
Total current assets	11,620	11,990	11,503
Property and equipment
Land	6,089	6,106	6,111
Buildings and improvements	28,041	27,611	27,315
Fixtures and equipment	5,361	5,503	5,282
Computer hardware and software	2,518	2,651	2,504
Construction-in-progress	423	200	232
Accumulated depreciation	(17,571)	(17,413)	(16,510)
Property and equipment, net	24,861	24,658	24,934
Noncurrent assets of discontinued operations	10	12	17
Other noncurrent assets	875	771	834
Total assets	37,366	37,431	37,288
Liabilities and shareholders’ investment
Accounts payable	7,584	7,252	6,811
Accrued and other current liabilities	3,790	3,737	3,544
Current portion of long-term debt and other borrowings	1,354	1,718	647
Liabilities of discontinued operations	1	1	1
Total current liabilities	12,729	12,708	11,003
Long-term debt and other borrowings	10,892	11,031	12,063
Deferred income taxes	784	861	754
Noncurrent liabilities of discontinued operations	18	18	19
Other noncurrent liabilities	1,845	1,860	1,872
Total noncurrent liabilities	13,539	13,770	14,708
Shareholders’ investment
Common stock	46	46	48
Additional paid-in capital	5,707	5,661	5,562
Retained earnings	5,961	5,884	6,579
Accumulated other comprehensive loss	(616)	(638)	(612)
Total shareholders’ investment	11,098	10,953	11,577
Total liabilities and shareholders’ investment	$ 37,366	$ 37,431	$ 37,288

Consolidated Statements of Fin6

Consolidated Statements of Financial Position (Parenthetical) - USD ($) $ in Millions	Jul. 29, 2017	Jan. 28, 2017	Jul. 30, 2016
Statement of Financial Position [Abstract]
Cash and cash equivalents, short-term investments	$ 1,135	$ 1,110	$ 2,931
Common stock, shares authorized	6,000,000,000	6,000,000,000	6,000,000,000
Common stock, par value (in dollars per share)	$ 0.0833	$ 0.0833	$ 0.0833
Common stock, shares issued	551,657,501	556,156,228	593,583,619
Common stock, shares outstanding	546,183,291	556,156,228	574,801,225
Preferred stock, shares authorized	5,000,000	5,000,000	5,000,000
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01	$ 0.01
Preferred stock, shares issued	0	0	0
Preferred stock, shares outstanding	0	0	0

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Millions	6 Months Ended
	Jul. 29, 2017	Jul. 30, 2016
Operating activities
Net earnings	$ 1,353	$ 1,312
Earnings from discontinued operations, net of tax	4	73
Net earnings from continuing operations	1,349	1,239
Adjustments to reconcile net earnings to cash provided by operations
Depreciation and amortization (exclusive of $X million, $70 million, $X million, and $135 million of depreciation included in cost of sales)	1,151	1,116
Share-based compensation expense	43	67
Deferred income taxes	(87)	(79)
Loss on debt extinguishment	0	422
Noncash losses / (gains) and other, net	81	(26)
Changes in operating accounts
Inventory	52	(29)
Other assets	74	131
Accounts payable	332	(607)
Accrued and other liabilities	(129)	(838)
Cash provided by operating activities—continuing operations	2,866	1,396
Cash provided by operating activities—discontinued operations	57	92
Cash provided by operations	2,923	1,488
Investing activities
Expenditures for property and equipment	(1,203)	(684)
Proceeds from disposal of property and equipment	22	14
Other investments	(80)	1
Cash required for investing activities	(1,261)	(669)
Financing activities
Additions to long-term debt	0	1,979
Reductions of long-term debt	(614)	(2,611)
Dividends paid	(663)	(666)
Repurchase of stock	(615)	(2,238)
Stock option exercises	9	151
Cash required for financing activities	(1,883)	(3,385)
Net decrease in cash and cash equivalents	(221)	(2,566)
Cash and cash equivalents at beginning of period	2,512	4,046
Cash and cash equivalents at end of period	$ 2,291	$ 1,480

Consolidated Statements of Shar

Consolidated Statements of Shareholders' Investment - USD ($) $ in Millions	3 Months Ended	6 Months Ended		12 Months Ended
	Jul. 29, 2017	Jul. 29, 2017	Jul. 30, 2016	Jan. 28, 2017
Increase (Decrease) in Shareholders' Investment
Beginning balance (in shares)		556,156,228
Beginning balance		$ 10,953	$ 12,957	$ 12,957
Net earnings	$ 672	1,353	1,312	2,737
Other comprehensive loss	$ 10	22	$ 17	(9)
Dividends declared		(675)		(1,359)
Repurchase of stock		(601)		(3,686)
Stock options and awards		$ 46		$ 313
Ending balance (in shares)	551,657,501	551,657,501	593,583,619	556,156,228
Ending balance	$ 11,098	$ 11,098	$ 11,577	$ 10,953
Common Stock
Increase (Decrease) in Shareholders' Investment
Beginning balance (in shares)		556,200,000	602,200,000	602,200,000
Beginning balance		$ 46	$ 50	$ 50
Repurchase of stock (in shares)		(10,600,000)		(50,900,000)
Repurchase of stock		$ 0		$ (4)
Stock options and awards (in shares)		600,000		4,900,000
Stock options and awards		$ 0		$ 0
Ending balance (in shares)	546,200,000	546,200,000		556,200,000
Ending balance	$ 46	$ 46		$ 46
Additional Paid-in Capital
Increase (Decrease) in Shareholders' Investment
Beginning balance		5,661	5,348	5,348
Stock options and awards		46		313
Ending balance	5,707	5,707		5,661
Retained Earnings
Increase (Decrease) in Shareholders' Investment
Beginning balance		5,884	8,188	8,188
Net earnings		1,353		2,737
Dividends declared		(675)		(1,359)
Repurchase of stock		(601)		(3,682)
Ending balance	5,961	5,961		5,884
Accumulated Other Comprehensive(Loss)/Income
Increase (Decrease) in Shareholders' Investment
Beginning balance		(638)	$ (629)	(629)
Other comprehensive loss		22		(9)
Ending balance	$ (616)	$ (616)		$ (638)

Accounting Policies

Accounting Policies	6 Months Ended
	Jul. 29, 2017
Accounting Policies [Abstract]
Accounting Policies	Accounting Policies These financial statements should be read in conjunction with the financial statement disclosures in our 2016 Form 10-K. We use the same accounting policies in preparing quarterly and annual financial statements. All adjustments necessary for a fair presentation of quarterly operating results are reflected herein and are of a normal, recurring nature. Certain prior-year amounts have been reclassified to conform to the current year presentation. Note 3 provides more information about a reclassification of supply chain-related depreciation expense to cost of sales. Unless otherwise noted, amounts presented within the Notes to Consolidated Financial Statements refer to our continuing operations. Due to the seasonal nature of our business, quarterly revenues, expenses, earnings, and cash flows are not necessarily indicative of the results that may be expected for the full year.

Revenues

Revenues	6 Months Ended
	Jul. 29, 2017
Accounting Changes and Error Corrections [Abstract]
Revenues	Revenues In May 2014, the FASB issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606). We plan to adopt the standard in the first quarter of fiscal 2018 using the full retrospective approach. We do not expect the standard to materially affect our consolidated net earnings, financial position, or cash flows. We are evaluating the impact the standard has on our determination of whether we act as principal or agent in certain vendor arrangements where the purchase and sale of inventory is virtually simultaneous. We currently record virtually all revenue and related costs gross, with approximately 3 percent of consolidated sales made under such arrangements. Due to the varying terms of these arrangements, the presentation required under the standard will depend on contract-specific terms and, in some instances, may result in net presentation of these amounts. Any change to net presentation would not impact gross margin dollars or earnings. We also expect minor changes to the timing of recognition of revenues related to promotional gift cards, and we expect to present certain other income streams, including credit card profit sharing income, in an other revenue line on our Consolidated Statements of Operations upon adoption.

Cost of Sales and Selling, Gene

Cost of Sales and Selling, General and Administrative Expenses	6 Months Ended
	Jul. 29, 2017
Accounting Changes and Error Corrections [Abstract]
Cost of Sales and Selling, General and Administrative Expenses	Cost of Sales and Selling, General and Administrative Expenses During the second quarter of 2017, we reclassified supply chain-related depreciation expense to cost of sales whereas it was previously included in depreciation and amortization on our Consolidated Statements of Operations. We reclassified prior year amounts to reflect this change. This reclassification increased cost of sales by $64 million and $129 million for the three and six months ended July 29, 2017, respectively, and $70 million and $135 million for the three and six months ended July 30, 2016, respectively, with equal and offsetting decreases to depreciation and amortization. This reclassification had no impact on sales, EBIT, net earnings or earnings per share. The following table illustrates the primary items classified in each major expense category: Cost of Sales Selling, General and Administrative Expenses Total cost of products sold including: Compensation and benefit costs for stores and Advertising, offset by vendor income that is a rd party bank issued Note: The classification of these expenses varies across the retail industry.

Fair Value Measurements

Fair Value Measurements	6 Months Ended
	Jul. 29, 2017
Fair Value Disclosures [Abstract]
Fair Value Measurements	Fair Value Measurements Fair value measurements are reported in one of three levels reflecting the valuation techniques used to determine fair value. Fair Value Measurements - Recurring Basis Fair Value at (millions) Pricing Category July 29, January 28, July 30, Assets Cash and cash equivalents Short-term investments held by U.S. entities Level 1 $ 251 $ 1,110 $ 303 Short-term investments held by entities located outside the U.S. (a) Level 1 1,366 762 497 Other current assets Prepaid forward contracts Level 1 37 26 31 Beneficial interest asset Level 3 6 12 13 Interest rate swaps (b) Level 2 — 1 — Other noncurrent assets Interest rate swaps (b) Level 2 4 4 28 Beneficial interest asset Level 3 — — 6 (a) Amounts may be subject to tax if repatriated. (b) See Note 8 for additional information on interest rate swaps. Significant Financial Instruments not Measured at Fair Value (a) (millions) July 29, 2017 January 28, 2017 July 30, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Debt (b) $ 11,122 $ 12,143 $ 11,715 $ 12,545 $ 11,712 $ 13,542 (a) The carrying amounts of certain other current assets, accounts payable, and certain accrued and other current liabilities approximate fair value due to their short-term nature. (b) The carrying amount and estimated fair value of debt exclude unamortized swap valuation adjustments and capital lease obligations.

Cash and Cash Equivalents (Note

Cash and Cash Equivalents (Notes)	6 Months Ended
	Jul. 29, 2017
Cash and Cash Equivalents [Abstract]
Cash and Cash Equivalents	Cash and Cash Equivalents Cash equivalents include highly liquid investments with an original maturity of three months or less from the time of purchase. Cash equivalents also include amounts due from third-party financial institutions for credit and debit card transactions, which typically settle in 5 days or less. (millions) July 29, January 28, July 30, Cash held by U.S. entities $ 239 $ 257 $ 249 Cash held by entities located outside the U.S. (a) 21 17 13 Short-term investments held by U.S. entities 251 1,110 303 Short-term investments held by entities located outside the U.S. (a) 1,366 762 497 Receivables from third-party financial institutions for credit and debit card transactions 414 366 418 Cash and cash equivalents $ 2,291 $ 2,512 $ 1,480 (a) Amounts may be subject to tax if repatriated.

Property and Equipment

Property and Equipment	6 Months Ended
	Jul. 29, 2017
Property, Plant and Equipment [Abstract]
Property and Equipment	Property and Equipment We review long-lived assets for impairment when events or changes in circumstances—such as a decision to relocate or close a store or distribution center, make significant software changes or discontinue projects—indicate that the asset’s carrying value may not be recoverable. We recognized impairment losses of $87 million and $88 million during the three and six months ended July 29, 2017, respectively, primarily resulting from planned or completed store closures and supply chain changes. We recognized impairment losses of $27 million and $28 million during the three and six months ended July 30, 2016, respectively, primarily resulting from planned or completed store closures. The impairments are recorded in selling, general and administrative expense on the Consolidated Statements of Operations and are included in segment results.

Notes Payable and Long-Term Deb

Notes Payable and Long-Term Debt	6 Months Ended
	Jul. 29, 2017
Debt Disclosure [Abstract]
Notes Payable and Long-Term Debt	Notes Payable and Long-Term Debt We obtain short-term financing from time to time under our commercial paper program, a form of notes payable. No balances were outstanding at any time during the six months ended July 29, 2017 and July 30, 2016 . In May 2017, we used cash on hand to repay $598 million of debt at its maturity. In April 2016, we issued unsecured fixed rate debt of $1 billion at 2.5% that matures in April 2026 and $1 billion at 3.625% that matures in April 2046. During the first and second quarter of 2016, we used cash on hand and proceeds from these issuances to repurchase $565 million and $824 million of debt, respectively, before its maturity at a market value of $820 million and $981 million , respectively. We recognized a loss on early retirement of approximately $261 million and $161 million in first and second quarter of 2016, respectively, which was recorded in net interest expense in our Consolidated Statements of Operations.

Derivative Financial Instrument

Derivative Financial Instruments	6 Months Ended
	Jul. 29, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Financial Instruments	Derivative Financial Instruments Our derivative instruments primarily consist of interest rate swaps, which we use to mitigate interest rate risk. As a result of our use of derivative instruments, we have counterparty credit exposure to large global financial institutions. We monitor this concentration of counterparty credit risk on an ongoing basis. See Note 4 for a description of the fair value measurement of our derivative instruments and their classification on the Consolidated Statements of Financial Position. As of July 29, 2017 and July 30, 2016 , interest rate swaps with notional amounts totaling $1,000 million were designated fair value hedges. No ineffectiveness was recognized during the three and six months ended July 29, 2017 or July 30, 2016 . As of July 29, 2017 and July 30, 2016 , one interest rate swap with a notional amount of $250 million was not designated a fair value hedge because it was de-designated concurrent with the repurchase of debt during the first half of 2016. We recorded income of $2 million and $6 million during the three and six months ended July 29, 2017 , respectively, and $8 million and $16 million during the three and six months ended July 30, 2016 , respectively, within net interest expense on our Consolidated Statements of Operations related to periodic payments, valuation adjustments, and amortization of gains or losses on our interest rate swaps.

Leases

Leases	6 Months Ended
	Jul. 29, 2017
Accounting Changes and Error Corrections [Abstract]
Leases	Leases In February 2016, the FASB issued ASU No. 2016-02, Leases. The new standard requires lessees to record assets and liabilities on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. We must adopt the standard no later than the first quarter of 2019, which begins on February 3, 2019. A modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. We plan to adopt the standard in the first quarter of 2018. We expect to take advantage of the package of practical expedients permitted within the new standard, which among other things, allows us to carryforward the historical lease classification. In addition, we plan to elect the hindsight practical expedient to determine the reasonably certain lease term. While lease classification will remain unchanged, hindsight may result in different accounting lease terms for certain leases and affect the timing of depreciation, interest, and rent expense, and the amount of lease assets and liabilities recognized. We expect to make an accounting policy election that would keep leases with an initial term of 12 months or less off of the balance sheet and would result in recognizing those lease payments in the Consolidated Statements of Operations on a straight-line basis over the lease term. While we are continuing to assess all potential impacts of the standard, we expect to record additional net lease liabilities of $1.2 - $1.7 billion , with an offsetting increase to leased assets of $0.9 - $1.4 billion . The difference between these amounts will be recorded as an adjustment to retained earnings. We do not believe the standard will materially affect our consolidated net earnings. These estimates — based on our current lease portfolio — may change as we continue to evaluate the new standard and as we implement a new lease accounting information system. The estimates could also change due to changes in the lease portfolio, which could include (a) lease volume, (b) lease commencement dates, and (c) renewal option and lease termination expectations. We will update our estimates each quarter as changes occur. We do not believe the new standard will have a notable impact on our liquidity. The standard will have no impact on our debt-covenant compliance under our current agreements.

Share Repurchase

Share Repurchase	6 Months Ended
	Jul. 29, 2017
Equity [Abstract]
Share Repurchase	Share Repurchase Six Months Ended (millions, except per share data) July 29, July 30, Total number of shares purchased 10.6 30.4 Average price paid per share $ 56.76 $ 73.70 Total investment $ 601 $ 2,243

Pension Benefits

Pension Benefits	6 Months Ended
	Jul. 29, 2017
Compensation and Retirement Disclosure [Abstract]
Pension Benefits	Pension Benefits We provide pension plan benefits to certain eligible team members. Net Pension Benefits Expense Three Months Ended Six Months Ended (millions) July 29, July 30, July 29, July 30, Service cost $ 21 $ 20 $ 42 $ 41 Interest cost 34 35 69 69 Expected return on assets (61 ) (65 ) (123 ) (129 ) Amortization of losses 15 13 30 25 Amortization of prior service cost (3 ) (3 ) (5 ) (6 ) Total $ 6 $ — $ 13 $ — In March 2017, the FASB issued ASU 2017-07, Compensation – Retirement Benefits (Topic 715) , which requires employers to disaggregate and present separately the current service cost component from the other components of net benefit cost within the Consolidated Statement of Operations. We plan to adopt the standard in the first quarter of fiscal 2018. We expect to reclassify the other components of net benefit cost to an other income and expense line on our Consolidated Statements of Operations upon adoption.

Accumulated Other Comprehensive

Accumulated Other Comprehensive (Loss) / Income	6 Months Ended
	Jul. 29, 2017
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Accumulated Other Comprehensive (Loss) / Income	Accumulated Other Comprehensive (Loss) / Income (millions) Cash Flow Hedges Currency Translation Adjustment Pension and Other Benefits Total January 28, 2017 $ (16 ) $ (21 ) $ (601 ) $ (638 ) Other comprehensive income before reclassifications — 6 — 6 Amounts reclassified from AOCI 2 (a) — 14 (b) 16 July 29, 2017 $ (14 ) $ (15 ) $ (587 ) $ (616 ) (a) Represents gains and losses on cash flow hedges, net of $1 million of taxes. (b) Represents amortization of pension and other benefit liabilities, net of $10 million of taxes.

Segment Reporting

Segment Reporting	6 Months Ended
	Jul. 29, 2017
Segment Reporting [Abstract]
Segment Reporting	Segment Reporting Our segment measure of profit (segment earnings before interest expense and income taxes) is used by management to evaluate performance and make operating decisions. We operate as a single segment that includes all of our continuing operations, which are designed to enable guests to purchase products seamlessly in stores or through our digital channels. Virtually all of our consolidated revenues are generated in the United States. The vast majority of our long–lived assets are located within the United States. Business Segment Results Three Months Ended Six Months Ended (millions) July 29, July 30, July 29, July 30, Sales $ 16,429 $ 16,169 $ 32,446 $ 32,364 Cost of sales (a) 11,419 11,172 22,618 22,421 Gross margin 5,010 4,997 9,828 9,943 Selling, general, and administrative expenses (c) 3,382 3,256 6,515 6,398 Depreciation and amortization (exclusive of depreciation included in cost of sales) (a) 514 500 1,022 981 Segment earnings before interest expense and income taxes 1,114 1,241 2,291 2,564 Pharmacy Transaction-related costs (b)(c) — 7 — (4 ) Earnings from continuing operations before interest expense and income taxes 1,114 1,248 2,291 2,560 Net interest expense 135 307 278 722 Earnings from continuing operations before income taxes $ 979 $ 941 $ 2,013 $ 1,838 Note: Amounts may not foot due to rounding. (a) Refer to Note 3 for information about the impact of a reclassification of supply chain-related depreciation expense. (b) For the three and six months ended July 30, 2016, represents items related to the December 2015 sale of our former pharmacy and clinic businesses to CVS (Pharmacy Transaction). (c) The sum of segment SG&A expenses and Pharmacy Transaction-related costs equal consolidated SG&A expenses. Reconciliation of Segment Assets to Total Assets (millions) July 29, January 28, July 30, Segment assets $ 37,337 $ 37,350 $ 37,182 Assets of discontinued operations 29 81 100 Unallocated assets (a) — — 6 Total assets $ 37,366 $ 37,431 $ 37,288 (a) Represents the insurance receivable related to the 2013 data breach.

Accounting Policies (Policies)

Accounting Policies (Policies)	6 Months Ended
	Jul. 29, 2017
Accounting Policies [Abstract]
New Accounting Pronouncements	In May 2014, the FASB issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers (Topic 606). We plan to adopt the standard in the first quarter of fiscal 2018 using the full retrospective approach. We do not expect the standard to materially affect our consolidated net earnings, financial position, or cash flows. We are evaluating the impact the standard has on our determination of whether we act as principal or agent in certain vendor arrangements where the purchase and sale of inventory is virtually simultaneous. We currently record virtually all revenue and related costs gross, with approximately 3 percent of consolidated sales made under such arrangements. Due to the varying terms of these arrangements, the presentation required under the standard will depend on contract-specific terms and, in some instances, may result in net presentation of these amounts. Any change to net presentation would not impact gross margin dollars or earnings. We also expect minor changes to the timing of recognition of revenues related to promotional gift cards, and we expect to present certain other income streams, including credit card profit sharing income, in an other revenue line on our Consolidated Statements of Operations upon adoption. In February 2016, the FASB issued ASU No. 2016-02, Leases. The new standard requires lessees to record assets and liabilities on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. We must adopt the standard no later than the first quarter of 2019, which begins on February 3, 2019. A modified retrospective transition approach is required for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. We plan to adopt the standard in the first quarter of 2018. We expect to take advantage of the package of practical expedients permitted within the new standard, which among other things, allows us to carryforward the historical lease classification. In addition, we plan to elect the hindsight practical expedient to determine the reasonably certain lease term. While lease classification will remain unchanged, hindsight may result in different accounting lease terms for certain leases and affect the timing of depreciation, interest, and rent expense, and the amount of lease assets and liabilities recognized. We expect to make an accounting policy election that would keep leases with an initial term of 12 months or less off of the balance sheet and would result in recognizing those lease payments in the Consolidated Statements of Operations on a straight-line basis over the lease term. While we are continuing to assess all potential impacts of the standard, we expect to record additional net lease liabilities of $1.2 - $1.7 billion , with an offsetting increase to leased assets of $0.9 - $1.4 billion . The difference between these amounts will be recorded as an adjustment to retained earnings. We do not believe the standard will materially affect our consolidated net earnings. These estimates — based on our current lease portfolio — may change as we continue to evaluate the new standard and as we implement a new lease accounting information system. The estimates could also change due to changes in the lease portfolio, which could include (a) lease volume, (b) lease commencement dates, and (c) renewal option and lease termination expectations. We will update our estimates each quarter as changes occur. We do not believe the new standard will have a notable impact on our liquidity. The standard will have no impact on our debt-covenant compliance under our current agreements. In March 2017, the FASB issued ASU 2017-07, Compensation – Retirement Benefits (Topic 715) , which requires employers to disaggregate and present separately the current service cost component from the other components of net benefit cost within the Consolidated Statement of Operations. We plan to adopt the standard in the first quarter of fiscal 2018. We expect to reclassify the other components of net benefit cost to an other income and expense line on our Consolidated Statements of Operations upon adoption.

Cost of Sales and Selling, Ge23

Cost of Sales and Selling, General and Administrative Expenses (Tables)	6 Months Ended
	Jul. 29, 2017
Accounting Changes and Error Corrections [Abstract]
Schedule of Major Expense Category Classification	The following table illustrates the primary items classified in each major expense category: Cost of Sales Selling, General and Administrative Expenses Total cost of products sold including: Compensation and benefit costs for stores and Advertising, offset by vendor income that is a rd party bank issued Note: The classification of these expenses varies across the retail industry.

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	6 Months Ended
	Jul. 29, 2017
Fair Value Disclosures [Abstract]
Schedule of Fair Value Measurements - Recurring Basis	Fair value measurements are reported in one of three levels reflecting the valuation techniques used to determine fair value. Fair Value Measurements - Recurring Basis Fair Value at (millions) Pricing Category July 29, January 28, July 30, Assets Cash and cash equivalents Short-term investments held by U.S. entities Level 1 $ 251 $ 1,110 $ 303 Short-term investments held by entities located outside the U.S. (a) Level 1 1,366 762 497 Other current assets Prepaid forward contracts Level 1 37 26 31 Beneficial interest asset Level 3 6 12 13 Interest rate swaps (b) Level 2 — 1 — Other noncurrent assets Interest rate swaps (b) Level 2 4 4 28 Beneficial interest asset Level 3 — — 6 (a) Amounts may be subject to tax if repatriated. (b) See Note 8 for additional information on interest rate swaps.
Schedule of Significant Financial Instruments not Measured at Fair Value	Significant Financial Instruments not Measured at Fair Value (a) (millions) July 29, 2017 January 28, 2017 July 30, 2016 Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Debt (b) $ 11,122 $ 12,143 $ 11,715 $ 12,545 $ 11,712 $ 13,542 (a) The carrying amounts of certain other current assets, accounts payable, and certain accrued and other current liabilities approximate fair value due to their short-term nature. (b) The carrying amount and estimated fair value of debt exclude unamortized swap valuation adjustments and capital lease obligations.

Cash and Cash Equivalents (Tabl

Cash and Cash Equivalents (Tables)	6 Months Ended
	Jul. 29, 2017
Cash and Cash Equivalents [Abstract]
Cash, Cash Equivalents and Investments	Cash equivalents include highly liquid investments with an original maturity of three months or less from the time of purchase. Cash equivalents also include amounts due from third-party financial institutions for credit and debit card transactions, which typically settle in 5 days or less. (millions) July 29, January 28, July 30, Cash held by U.S. entities $ 239 $ 257 $ 249 Cash held by entities located outside the U.S. (a) 21 17 13 Short-term investments held by U.S. entities 251 1,110 303 Short-term investments held by entities located outside the U.S. (a) 1,366 762 497 Receivables from third-party financial institutions for credit and debit card transactions 414 366 418 Cash and cash equivalents $ 2,291 $ 2,512 $ 1,480 (a) Amounts may be subject to tax if repatriated.

Share Repurchase (Tables)

Share Repurchase (Tables)	6 Months Ended
	Jul. 29, 2017
Equity [Abstract]
Schedule of Share Repurchase (excluding ASR)	Six Months Ended (millions, except per share data) July 29, July 30, Total number of shares purchased 10.6 30.4 Average price paid per share $ 56.76 $ 73.70 Total investment $ 601 $ 2,243

Pension Benefits (Tables)

Pension Benefits (Tables)	6 Months Ended
	Jul. 29, 2017
Compensation and Retirement Disclosure [Abstract]
Schedule of Net Pension and Postretirement Health Care Benefits Expense	We provide pension plan benefits to certain eligible team members. Net Pension Benefits Expense Three Months Ended Six Months Ended (millions) July 29, July 30, July 29, July 30, Service cost $ 21 $ 20 $ 42 $ 41 Interest cost 34 35 69 69 Expected return on assets (61 ) (65 ) (123 ) (129 ) Amortization of losses 15 13 30 25 Amortization of prior service cost (3 ) (3 ) (5 ) (6 ) Total $ 6 $ — $ 13 $ —

Accumulated Other Comprehensi28

Accumulated Other Comprehensive (Loss) / Income (Tables)	6 Months Ended
	Jul. 29, 2017
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]
Summary of the Changes in Accumulated Other Comprehensive Income (AOCI) by Component	(millions) Cash Flow Hedges Currency Translation Adjustment Pension and Other Benefits Total January 28, 2017 $ (16 ) $ (21 ) $ (601 ) $ (638 ) Other comprehensive income before reclassifications — 6 — 6 Amounts reclassified from AOCI 2 (a) — 14 (b) 16 July 29, 2017 $ (14 ) $ (15 ) $ (587 ) $ (616 ) (a) Represents gains and losses on cash flow hedges, net of $1 million of taxes. (b) Represents amortization of pension and other benefit liabilities, net of $10 million of taxes.

Segment Reporting (Tables)

Segment Reporting (Tables)	6 Months Ended
	Jul. 29, 2017
Segment Reporting [Abstract]
Schedule of Business Segment Results and Reconciliation of Segment Assets to Total Assets	We operate as a single segment that includes all of our continuing operations, which are designed to enable guests to purchase products seamlessly in stores or through our digital channels. Virtually all of our consolidated revenues are generated in the United States. The vast majority of our long–lived assets are located within the United States. Business Segment Results Three Months Ended Six Months Ended (millions) July 29, July 30, July 29, July 30, Sales $ 16,429 $ 16,169 $ 32,446 $ 32,364 Cost of sales (a) 11,419 11,172 22,618 22,421 Gross margin 5,010 4,997 9,828 9,943 Selling, general, and administrative expenses (c) 3,382 3,256 6,515 6,398 Depreciation and amortization (exclusive of depreciation included in cost of sales) (a) 514 500 1,022 981 Segment earnings before interest expense and income taxes 1,114 1,241 2,291 2,564 Pharmacy Transaction-related costs (b)(c) — 7 — (4 ) Earnings from continuing operations before interest expense and income taxes 1,114 1,248 2,291 2,560 Net interest expense 135 307 278 722 Earnings from continuing operations before income taxes $ 979 $ 941 $ 2,013 $ 1,838 Note: Amounts may not foot due to rounding. (a) Refer to Note 3 for information about the impact of a reclassification of supply chain-related depreciation expense. (b) For the three and six months ended July 30, 2016, represents items related to the December 2015 sale of our former pharmacy and clinic businesses to CVS (Pharmacy Transaction). (c) The sum of segment SG&A expenses and Pharmacy Transaction-related costs equal consolidated SG&A expenses. Reconciliation of Segment Assets to Total Assets (millions) July 29, January 28, July 30, Segment assets $ 37,337 $ 37,350 $ 37,182 Assets of discontinued operations 29 81 100 Unallocated assets (a) — — 6 Total assets $ 37,366 $ 37,431 $ 37,288 (a) Represents the insurance receivable related to the 2013 data breach.

Revenues (Details)

Revenues (Details)	6 Months Ended
	Jul. 29, 2017
Accounting Changes and Error Corrections [Abstract]
Percentage of sales accounted for as vendor sales to customers	3.00%

Cost of Sales and Selling, Ge31

Cost of Sales and Selling, General and Administrative Expenses (Details) - USD ($) $ in Millions		3 Months Ended		6 Months Ended
		Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cost of sales (a)	[1]	$ 11,419	$ 11,172	$ 22,618	$ 22,421
Adjustment
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cost of sales (a)		$ 64	$ 70	$ 129	$ 135
[1]	Refer to Note 3 for information about a reclassification of supply chain-related depreciation expense to cost of sales.

Fair Value Measurements - Sched

Fair Value Measurements - Schedule of Fair Value Measurements - Recurring Basis (Details) - USD ($) $ in Millions	Jul. 29, 2017	Jan. 28, 2017	Jul. 30, 2016
Cash and cash equivalents
Short-term investments held by U.S. entities	$ 1,135	$ 1,110	$ 2,931
Other current assets
Other current assets	1,053	1,100	1,309
Other noncurrent assets
Other noncurrent assets	875	771	834
Short term investments held by US entities
Cash and cash equivalents
Short-term investments held by U.S. entities	251	1,110	303
Short term investments held by entities outside of US
Cash and cash equivalents
Short-term investments held by U.S. entities	1,366	762	497
Fair value measured on recurring basis | Level 1 | Prepaid forward contracts
Other current assets
Other current assets	37	26	31
Fair value measured on recurring basis | Level 1 | Short-term investments | Short term investments held by US entities
Cash and cash equivalents
Short-term investments held by U.S. entities	251	1,110	303
Fair value measured on recurring basis | Level 1 | Short-term investments | Short term investments held by entities outside of US
Cash and cash equivalents
Short-term investments held by U.S. entities	1,366	762	497
Fair value measured on recurring basis | Level 2 | Interest rate swaps
Other current assets
Other current assets	0	1	0
Other noncurrent assets
Other noncurrent assets	4	4	28
Fair value measured on recurring basis | Level 3 | Beneficial interest asset
Other current assets
Other current assets	6	12	13
Other noncurrent assets
Other noncurrent assets	$ 0	$ 0	$ 6

Fair Value Measurements - Sch33

Fair Value Measurements - Schedule of Significant Financial Instruments not Measured at Fair Value (Details) - USD ($) $ in Millions	Jul. 29, 2017	Jan. 28, 2017	Jul. 30, 2016
Carrying Amount
Financial Instruments, Balance Sheet Groupings
Debt	$ 11,122	$ 11,715	$ 11,712
Fair Value
Financial Instruments, Balance Sheet Groupings
Debt	$ 12,143	$ 12,545	$ 13,542

Cash and Cash Equivalents (Deta

Cash and Cash Equivalents (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 29, 2017	Jan. 28, 2017	Jul. 30, 2016	Jan. 30, 2016
Cash and Cash Equivalents [Line Items]
Cash equivalents credit and debit card transactions due period maximum	5 days
Short-term investments held by U.S. entities	$ 1,135	$ 1,110	$ 2,931
Receivables from third-party financial institutions for credit and debit card transactions	414	366	418
Cash and cash equivalents	2,291	2,512	1,480	$ 4,046
Held by US entities
Cash and Cash Equivalents [Line Items]
Cash held	239	257	249
Short-term investments held by U.S. entities	251	1,110	303
Held by entities outside of US
Cash and Cash Equivalents [Line Items]
Cash held	21	17	13
Short-term investments held by U.S. entities	$ 1,366	$ 762	$ 497

Property and Equipment (Details

Property and Equipment (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
Property, Plant and Equipment [Abstract]
Long-lived asset impairments	$ 87	$ 27	$ 88	$ 28

Notes Payable and Long-Term D36

Notes Payable and Long-Term Debt (Details) - USD ($)	May 01, 2017	Jul. 30, 2016	Apr. 30, 2016	Jul. 29, 2017
Unsecured Debt
Debt Instrument [Line Items]
Repayments of debt	$ 598,000,000
Repurchased amount		$ 824,000,000	$ 565,000,000
Market value		981,000,000	820,000,000
Loss on early retirement		161,000,000	261,000,000
Unsecured Debt | Unsecured Fixed Rate 2.5 % Debt Maturing April 2026
Debt Instrument [Line Items]
Unsecured fixed rate debt			$ 1,000,000,000
Interest rate			2.50%
Unsecured Debt | Unsecured Fixed Rate 3.625 % Debt Maturing April 2046
Debt Instrument [Line Items]
Unsecured fixed rate debt			$ 1,000,000,000
Interest rate			3.625%
Commercial Paper
Debt Instrument [Line Items]
Amount outstanding		$ 0		$ 0

Derivative Financial Instrume37

Derivative Financial Instruments - Narrative (Details) - Interest Rate Swaps	3 Months Ended		6 Months Ended
	Jul. 29, 2017USD ($)instrument	Jul. 30, 2016USD ($)instrument	Jul. 29, 2017USD ($)instrument	Jul. 30, 2016USD ($)instrument
Derivative Contracts - Effect on Results of Operations (millions)
Derivative Instruments Not Designated as Hedging Instruments, Gain (Loss), Net	$ (2,000,000)	$ (8,000,000)	$ (6,000,000)	$ (16,000,000)
Designated as Hedging Instrument
Derivative Contracts - Effect on Results of Operations (millions)
Notional amount	1,000,000,000	1,000,000,000	1,000,000,000	1,000,000,000
Amount of ineffectiveness recognized	0	0	0	0
Not Designated as Hedging Instrument
Derivative Contracts - Effect on Results of Operations (millions)
Notional amount	$ 250,000,000	$ 250,000,000	$ 250,000,000	$ 250,000,000
Number of derivative instruments | instrument	1	1	1	1

Leases (Details)

Leases (Details) - ASU 2016-02 - Forecast $ in Billions	May 05, 2018USD ($)
Minimum
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Lease liabilities	$ 1.2
Lease assets	0.9
Maximum
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Lease liabilities	1.7
Lease assets	$ 1.4

Share Repurchase - Schedule of

Share Repurchase - Schedule of Share Repurchases (excluding ASR) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	6 Months Ended
	Jul. 29, 2017	Jul. 30, 2016
Equity [Abstract]
Total number of shares purchased	10.6	30.4
Average price paid per share (in dollars per share)	$ 56.76	$ 73.70
Total investment	$ 601	$ 2,243

Pension Benefits - Schedule of

Pension Benefits - Schedule of Net Pension and Postretirement Health Care Benefits Expense (Details) - Pension Plan - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
Net Pension Benefits Expense
Service cost	$ 21	$ 20	$ 42	$ 41
Interest cost	34	35	69	69
Expected return on assets	(61)	(65)	(123)	(129)
Amortization of losses	15	13	30	25
Amortization of prior service cost	(3)	(3)	(5)	(6)
Total	$ 6	$ 0	$ 13	$ 0

Accumulated Other Comprehensi41

Accumulated Other Comprehensive (Loss) / Income (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			$ 10,953	$ 12,957
Ending balance	$ 11,098	$ 11,577	11,098	11,577
Net amount of taxes	308	$ 316	664	599
Cash Flow Hedges
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			(16)
Other comprehensive income before reclassifications			0
Amounts reclassified from AOCI			2
Ending balance	(14)		(14)
Cash Flow Hedges | Amount reclassified from other comprehensive income
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Net amount of taxes			1
Currency Translation Adjustment
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			(21)
Other comprehensive income before reclassifications			6
Amounts reclassified from AOCI			0
Ending balance	(15)		(15)
Pension and Other Benefits
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			(601)
Other comprehensive income before reclassifications			0
Amounts reclassified from AOCI			14
Ending balance	(587)		(587)
Pension and Other Benefits | Amount reclassified from other comprehensive income
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Net amount of taxes			10
Total
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			(638)	$ (629)
Other comprehensive income before reclassifications			6
Amounts reclassified from AOCI			16
Ending balance	$ (616)		$ (616)

Segment Reporting - Business Se

Segment Reporting - Business Segment Results (Details) - USD ($) $ in Millions		3 Months Ended		6 Months Ended
		Jul. 29, 2017	Jul. 30, 2016	Jul. 29, 2017	Jul. 30, 2016
Segment Reporting [Abstract]
Sales		$ 16,429	$ 16,169	$ 32,446	$ 32,364
Cost of sales (a)	[1]	11,419	11,172	22,618	22,421
Gross margin		5,010	4,997	9,828	9,943
Selling, general and administrative expenses		3,382	3,256	6,515	6,398
Depreciation and amortization (exclusive of depreciation included in cost of sales) (a)		514	500	1,022	981
Segment profit		1,114	1,241	2,291	2,564
Pharmacy transaction related costs		0	7	0	(4)
Earnings from continuing operations before interest expense and income taxes		1,114	1,248	2,291	2,560
Net interest expense		135	307	278	722
Earnings from continuing operations before income taxes		$ 979	$ 941	$ 2,013	$ 1,838
[1]	Refer to Note 3 for information about a reclassification of supply chain-related depreciation expense to cost of sales.

Segment Reporting - Reconciliat

Segment Reporting - Reconciliation of Segment Assets to Total Assets (Details) - USD ($) $ in Millions	Jul. 29, 2017	Jan. 28, 2017	Jul. 30, 2016
Segment Reporting Information 2 [Line Items]
Total assets	$ 37,366	$ 37,431	$ 37,288
Assets of discontinued operations
Segment Reporting Information 2 [Line Items]
Total assets	29	81	100
Segment assets
Segment Reporting Information 2 [Line Items]
Total assets	37,337	37,350	37,182
Unallocated assets
Segment Reporting Information 2 [Line Items]
Total assets	$ 0	$ 0	$ 6