Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Nov. 03, 2018 | Nov. 26, 2018 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Document Period End Date | Nov. 3, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | GPS | |
Entity Registrant Name | GAP INC | |
Entity Central Index Key | 39,911 | |
Current Fiscal Year End Date | --02-02 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 381,434,098 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 |
Current assets: | |||
Cash and cash equivalents | $ 958 | $ 1,783 | $ 1,353 |
Available-for-sale Securities, Current | 296 | 0 | 0 |
Merchandise inventory | 2,668 | 1,997 | 2,476 |
Other current assets | 792 | 788 | 654 |
Total current assets | 4,714 | 4,568 | 4,483 |
Property and equipment, net of accumulated depreciation of $6,063, $5,962, and $6,002 | 2,887 | 2,805 | 2,686 |
Other long-term assets | 572 | 616 | 726 |
Total assets | 8,173 | 7,989 | 7,895 |
Current liabilities: | |||
Accounts payable | 1,299 | 1,181 | 1,330 |
Accrued expenses and other current liabilities | 1,070 | 1,270 | 1,132 |
Income taxes payable | 24 | 10 | 134 |
Total current liabilities | 2,393 | 2,461 | 2,596 |
Long-term liabilities: | |||
Total long-term debt | 1,249 | 1,249 | 1,248 |
Lease incentives and other long-term liabilities | 1,091 | 1,135 | 1,027 |
Total long-term liabilities | 2,340 | 2,384 | 2,275 |
Commitments and contingencies (see Note 11) | |||
Stockholders' equity: | |||
Authorized 2,300 shares for all periods presented; Issued and Outstanding 385, 389, and 392 shares | 19 | 19 | 19 |
Additional Paid in Capital | 0 | 8 | 0 |
Retained earnings | 3,368 | 3,081 | 2,965 |
Amounts reclassified from accumulated other comprehensive income | 53 | 36 | 40 |
Total stockholders' equity | 3,440 | 3,144 | 3,024 |
Total liabilities and stockholders' equity | $ 8,173 | $ 7,989 | $ 7,895 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Millions, $ in Millions | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 |
Property and equipment, accumulated depreciation | $ 6,112 | $ 5,962 | $ 6,041 |
Common stock, par value (in dollars per share) | $ 0.05 | $ 0.05 | $ 0.05 |
Common stock, shares authorized (in shares) | 2,300 | 2,300 | 2,300 |
Common stock, shares issued (in shares) | 382 | 389 | 389 |
Common stock, shares outstanding (in shares) | 382 | 389 | 389 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | ||
Net Sales | [1] | $ 4,089 | $ 3,838 | $ 11,957 | $ 11,077 |
Cost of goods sold and occupancy expenses | 2,466 | 2,313 | 7,280 | 6,770 | |
Gross profit | 1,623 | 1,525 | 4,677 | 4,307 | |
Operating Expenses | 1,260 | 1,147 | 3,687 | 3,224 | |
Operating income | 363 | 378 | 990 | 1,083 | |
Interest Expense | 21 | 18 | 54 | 53 | |
Interest income | (8) | (4) | (21) | (11) | |
Income before income taxes | 350 | 364 | 957 | 1,041 | |
Income taxes | 84 | 135 | 230 | 398 | |
Net income | $ 266 | $ 229 | $ 727 | $ 643 | |
Weighted-average number of shares - basic (in shares) | 384 | 391 | 387 | 395 | |
Weighted-average number of shares - diluted (in shares) | 387 | 393 | 390 | 397 | |
Earnings per share - basic (in dollars per share) | $ 0.69 | $ 0.59 | $ 1.88 | $ 1.63 | |
Earnings per share - diluted (in dollars per share) | 0.69 | 0.58 | 1.86 | 1.62 | |
Cash dividends declared and paid per share (in dollars per share) | $ 0.2425 | $ 0.23 | $ 0.7275 | $ 0.69 | |
[1] | Net sales for the thirteen and thirty-nine weeks ended November 3, 2018 reflect the adoption of the new revenue recognition standard, which resulted in an increase to net sales of $170 million and $449 million, respectively, for revenue sharing and reimbursements of loyalty program discounts associated with the Company's credit card programs, as well as breakage revenue for our gift cards and credit vouchers. Prior period amounts have not been restated and continue to be reported under accounting standards in effect for those periods. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | |
Net income | $ 266 | $ 229 | $ 727 | $ 643 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation and other, net | (4) | (5) | (27) | 12 |
Change in fair value of derivative financial instruments, net of tax (tax benefit) of $3, $(12), $(3) and $(8) | 11 | 23 | 57 | (20) |
Reclassification adjustment for gains on derivative financial instruments, net of (tax) tax benefit of $-, $-, $9 and $(2) | (7) | (1) | (13) | (6) |
Other comprehensive income (loss), net of tax | 0 | 17 | 17 | (14) |
Comprehensive income | $ 266 | $ 246 | $ 744 | $ 629 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | |
Change in fair value of derivative financial instruments, net of tax (tax benefit) | $ 1 | $ 2 | $ (2) | $ (6) |
Reclassification adjustment for (gains) losses on derivative financial instruments, net of (tax) tax benefit | $ (1) | $ 6 | $ 8 | $ 4 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 9 Months Ended | |
Nov. 03, 2018 | Oct. 28, 2017 | |
Cash flows from operating activities: | ||
Net income | $ 727 | $ 643 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 425 | 418 |
Amortization of lease incentives | (45) | (46) |
Share-based compensation | 72 | 60 |
Non-cash and other items | 10 | 26 |
Deferred income taxes | 33 | (50) |
Changes in operating assets and liabilities: | ||
Merchandise inventory | (696) | (636) |
Other current assets and other long-term assets | (64) | (60) |
Accounts payable | 90 | 55 |
Accrued expenses and other current liabilities | (148) | (46) |
Income taxes payable, net of prepaid and other tax-related items | 127 | 188 |
Lease incentives and other long-term liabilities | 36 | 48 |
Net cash provided by operating activities | 567 | 600 |
Cash flows from investing activities: | ||
Purchases of property and equipment | (510) | (463) |
Insurance proceeds related to loss on property and equipment | 0 | 60 |
Payments to Acquire Short-term Investments | (408) | 0 |
Proceeds from Sale, Maturity and Collection of Short-term Investments | 112 | 0 |
Other | (7) | 0 |
Net cash used for investing activities | (813) | (403) |
Cash flows from financing activities: | ||
Payments of current maturities of debt | 0 | (67) |
Proceeds from issuances under share-based compensation plans | 40 | 23 |
Withholding tax payments related to vesting of stock units | (22) | (15) |
Repurchases of common stock | (300) | (300) |
Cash dividends paid | (281) | (272) |
Other | (1) | 0 |
Net cash used for financing activities | (564) | (631) |
Effect of Exchange Rate on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | (13) | 7 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | (823) | (427) |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents beginning of period | 1,799 | 1,797 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents end of period | 976 | 1,370 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest during the period | 77 | 76 |
Cash paid for income taxes during the period, net of refunds | $ 73 | $ 260 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Nov. 03, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The Condensed Consolidated Balance Sheets as of November 3, 2018 and October 28, 2017 , and the Condensed Consolidated Statements of Income and the Condensed Consolidated Statements of Comprehensive Income for the thirteen and thirty-nine weeks ended November 3, 2018 and October 28, 2017 , and the Condensed Consolidated Statements of Cash Flows for the thirty-nine weeks ended November 3, 2018 and October 28, 2017 have been prepared by The Gap, Inc. (the “Company,” “we,” and “our”). In the opinion of management, such statements include all adjustments (which include normal recurring adjustments) considered necessary to present fairly our financial position, results of operations, and cash flows as of November 3, 2018 and October 28, 2017 and for all periods presented. The Condensed Consolidated Balance Sheet as of February 3, 2018 has been derived from our audited financial statements. The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission. Accordingly, certain information and disclosures normally included in the notes to the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted from these interim financial statements, although the Company believes that the disclosures made are adequate to make the information not misleading. We suggest that you read these Condensed Consolidated Financial Statements in conjunction with the Consolidated Financial Statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended February 3, 2018 . The results of operations for the thirteen and thirty-nine weeks ended November 3, 2018 are not necessarily indicative of the operating results that may be expected for the 52-week period ending February 2, 2019 . |
Accounting Policies
Accounting Policies | 9 Months Ended |
Nov. 03, 2018 | |
Recent Accounting Pronouncements [Abstract] | |
Recent Accounting Pronouncements | Accounting Policies Accounting Pronouncements Recently Adopted Revenue from Contracts with Customers In May 2014, the Financial Accounting Standards Board (“FASB”) issued accounting standards update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, to clarify the principles of recognizing revenue and create common revenue recognition guidance between U.S. GAAP and International Financial Reporting Standards. On February 4, 2018, we adopted ASU No. 2014-09 and related amendments (collectively “ASC 606”) using the modified retrospective transition method and recorded an increase to opening retained earnings of $36 million , net of tax, related primarily to breakage revenue for gift cards and credit vouchers, outstanding loyalty points, and reimbursements of loyalty program discounts. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company’s revenues include merchandise sales at stores, online, and through franchise agreements. We also receive revenue sharing from our credit card agreement for private label and co-branded credit cards, and breakage revenue related to our gift cards, credit vouchers, and outstanding loyalty points, which are realized based upon historical redemption patterns. For online sales and catalog sales, the Company has elected to treat shipping and handling as fulfillment activities and not a separate performance obligation. Accordingly, we recognize revenue for our single performance obligation related to online sales and catalog sales at the time control of the merchandise passes to the customer, which is generally at the time of shipment. We also record an allowance for estimated returns based on our historical return patterns and various other assumptions that management believes to be reasonable, which is presented on a gross basis on our Condensed Consolidated Balance Sheet. Revenues are presented net of any taxes collected from customers and remitted to governmental authorities. Our credit card agreement provides for certain payments to be made to us, including a share of revenue from the performance of the credit card portfolios and reimbursements of loyalty program discounts. We have identified separate performance obligations related to our credit card agreement that includes both providing a license and an obligation to redeem loyalty points issued under the loyalty rewards program. Our obligation to provide a license is satisfied when the subsequent sale or usage occurs and our obligation to redeem loyalty points is deferred until those loyalty points are redeemed. With the adoption of ASC 606, income related to our credit card agreement is now classified within net sales in our Condensed Consolidated Statement of Income. We also have franchise agreements with unaffiliated franchisees to operate Gap, Banana Republic, and Old Navy stores in a number of countries throughout Asia, Europe, Latin America, the Middle East, and Africa. Under these agreements, third parties operate, or will operate, stores that sell apparel and related products under our brand names. We have identified separate performance obligations related to our franchise agreements that include both providing our franchise partners with a license and an obligation to supply franchise partners with our merchandise. Our obligation to provide a license is satisfied when the subsequent sale or usage occurs and our obligation to supply franchise partners with our merchandise is satisfied when control transfers. As of the quarter ended November 3, 2018 , there were no material contract liabilities related to our franchise agreements. We defer revenue when cash payments are received in advance of performance for unsatisfied obligations related to our gift cards, credit vouchers, outstanding loyalty points, and reimbursements of loyalty program discounts associated with our credit card agreement. For the thirteen weeks ended November 3, 2018, the opening balance of deferred revenue for these obligations was $194 million , of which $84 million was recognized as revenue during the period. For the thirty-nine weeks ended November 3, 2018, the opening balance of deferred revenue for these obligations was $232 million , of which $170 million was recognized as revenue during the period. The closing balance of deferred revenue related to gift cards, credit vouchers, outstanding loyalty points, and reimbursements of loyalty program discounts was $193 million as of the quarter ended November 3, 2018 . We expect that the majority of our revenue deferrals as of the quarter ended November 3, 2018 will be recognized as revenue in the next 12 months as our performance obligations are satisfied. For the thirteen and thirty-nine weeks ended November 3, 2018 , the impact of applying ASC 606 primarily resulted in an increase in net sales driven by a reclassification of $128 million and $320 million , respectively, for revenue sharing associated with our credit card programs and breakage revenue for gift cards and credit vouchers, which were previously recorded as a reduction to operating expenses in our Condensed Consolidated Statements of Income. Net sales for the thirteen and thirty-nine weeks ended November 3, 2018 also increased by $42 million and $129 million , respectively, due to the reclassification of reimbursements of loyalty program discounts associated with our credit card programs, which were previously recorded as a reduction to cost of goods sold and occupancy expenses in our Condensed Consolidated Statements of Income. There were no other material impacts to the Condensed Consolidated Statements of Income resulting from the application of ASC 606 during the thirteen or thirty-nine weeks ended November 3, 2018 . In addition, with the adoption of ASC 606 we now recognize allowances for estimated sales returns on a gross basis rather than net basis on our Condensed Consolidated Balance Sheet. For the quarter ended November 3, 2018 , we recorded a right of return asset for merchandise we expect to receive back from customers of $44 million , which is recorded within other current assets on our Condensed Consolidated Balance Sheet, and a liability for refunds payable of $103 million , which is recorded within accrued expenses and other current liabilities on our Condensed Consolidated Balance Sheet. For the quarter ended November 3, 2018 , the net amount under the previous guidance would have been $57 million recorded as accrued expenses and other current liabilities on our Condensed Consolidated Balance Sheet. Accordingly, the impact of the change in accounting standard on our Condensed Consolidated Balance Sheet is an increase of $44 million to other current assets and an increase of $46 million to accrued expenses and other current liabilities. See Note 12 of Notes to Condensed Consolidated Financial Statements “Segment Information” for disaggregation of revenue by brand and by region. Statement of Cash Flows: Restricted Cash In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash, which amended the presentation of restricted cash within the statement of cash flows. The new guidance requires that restricted cash be added to cash and cash equivalents on the statement of cash flows. On February 4, 2018, we adopted ASU 2016-18 on a retrospective basis. The retrospective adoption increased our beginning and ending cash and cash equivalent balances within our Condensed Consolidated Statements of Cash Flows to include restricted cash balances. The adoption had no other material impacts to our Condensed Consolidated Statements of Cash Flows and had no impact on our results of operations or financial position. Amounts included in restricted cash primarily represent cash that serves as collateral for our insurance obligations. Any cash that is legally restricted from use is classified as restricted cash. If the purpose of restricted cash is related to acquiring a long-term asset, liquidating a long-term liability, or is otherwise unavailable for a period longer than one year from the balance sheet date, the restricted cash is included within other long-term assets on our Condensed Consolidated Balance Sheets. Otherwise, restricted cash is included within other current assets on our Condensed Consolidated Balance Sheets. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within our Condensed Consolidated Balance Sheets to the total shown in our Condensed Consolidated Statements of Cash Flows: ($ in millions) November 3, February 3, October 28, Cash and cash equivalents $ 958 $ 1,783 $ 1,353 Restricted cash included in other current assets 1 1 1 Restricted cash included in other long-term assets 17 15 16 Total cash, cash equivalents, and restricted cash shown in the Condensed Consolidated Statement of Cash Flows $ 976 $ 1,799 $ 1,370 Recognition and Measurement of Financial Assets and Financial Liabilities In January 2016, the FASB issued ASU 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities, that updates certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. We adopted this ASU on February 4, 2018 with no material impact to our Condensed Consolidated Financial Statements. Accounting Pronouncements Not Yet Adopted Except as noted below, the Company has considered all recent accounting pronouncements and has concluded that there are no recent accounting pronouncements that may have a material impact on its Condensed Consolidated Financial Statements, based on current information. In February 2016, the FASB issued ASU No. 2016-02, Leases. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases (with the exception of short-term leases) at the commencement date. The standard is effective for annual periods beginning after December 15, 2018 and interim periods within that year. The standard may be adopted by a modified retrospective method or by an optional transition method, which allows for the prospective application of the standard. We are assessing the impact of this ASU on our Consolidated Financial Statements, but it will result in a material increase to our long-term assets and liabilities. We will adopt this ASU on February 4, 2019 and plan to use the optional transition method with a cumulative adjustment to retained earnings. In August 2017, the FASB issued ASU No. 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities. The amendments are intended to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. The ASU is effective for fiscal years and interim periods within those years beginning after December 15, 2018. We are assessing the impact of this ASU on our Consolidated Financial Statements. We will adopt this ASU on a prospective basis on February 4, 2019. |
Debt and Credit Facilities
Debt and Credit Facilities | 9 Months Ended |
Nov. 03, 2018 | |
Debt Disclosure [Abstract] | |
Debt and Credit Facilities | Debt and Credit Facilities As of November 3, 2018 , February 3, 2018 , and October 28, 2017 , the estimated fair value of our $1.25 billion aggregate principal amount of 5.95 percent notes (the “Notes”) due April 2021 was $1.29 billion , $1.33 billion , and $1.35 billion , respectively, and was based on the quoted market price of the Notes (level 1 inputs) as of the last business day of the respective fiscal quarter. The aggregate principal amount of the Notes is recorded in long-term debt on the Condensed Consolidated Balance Sheets, net of the unamortized discount. We have a $500 million , five -year, unsecured revolving credit facility (the “Facility”), which is scheduled to expire in May 2023 . There were no borrowings and no material outstanding standby letters of credit under the Facility as of November 3, 2018 . We maintain multiple agreements with third parties that make unsecured revolving credit facilities available for our operations in foreign locations (the “Foreign Facilities”). These Foreign Facilities are uncommitted and are generally available for borrowings, overdraft borrowings, and the issuance of bank guarantees. The total capacity of the Foreign Facilities was $56 million as of November 3, 2018 . As of November 3, 2018 , there were no borrowings under the Foreign Facilities. There were $15 million in bank guarantees issued and outstanding primarily related to store leases under the Foreign Facilities as of November 3, 2018 . We have bilateral unsecured standby letter of credit agreements that are uncommitted and do not have expiration dates. As of November 3, 2018 , we had $13 million in standby letters of credit issued under these agreements. Our 15 billion Japanese yen, four -year, unsecured term loan which was due on January 15, 2018 , was paid in full in June 2017. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Nov. 03, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements There were no purchases, sales, issuances, or settlements related to recurring level 3 measurements during the thirteen and thirty-nine weeks ended November 3, 2018 or October 28, 2017 . There were no transfers of financial assets or liabilities into or out of level 1 and level 2 during the thirteen and thirty-nine weeks ended November 3, 2018 or October 28, 2017 . Financial Assets and Liabilities Financial assets and liabilities measured at fair value on a recurring basis and cash equivalents are as follows: Fair Value Measurements at Reporting Date Using ($ in millions) November 3, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 438 $ 30 $ 408 $ — Short-term investments 296 124 172 — Derivative financial instruments 46 — 46 — Deferred compensation plan assets 49 49 — — Total $ 829 $ 203 $ 626 $ — Liabilities: Derivative financial instruments $ 1 $ — $ 1 $ — Fair Value Measurements at Reporting Date Using ($ in millions) February 3, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 527 $ 37 $ 490 $ — Derivative financial instruments 14 — 14 — Deferred compensation plan assets 47 47 — — Total $ 588 $ 84 $ 504 $ — Liabilities: Derivative financial instruments $ 43 $ — $ 43 $ — Fair Value Measurements at Reporting Date Using ($ in millions) October 28, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 389 $ 28 $ 361 $ — Derivative financial instruments 31 — 31 — Deferred compensation plan assets 46 46 — — Total $ 466 $ 74 $ 392 $ — Liabilities: Derivative financial instruments $ 20 $ — $ 20 $ — We have highly liquid investments classified as cash equivalents, which are placed primarily in time deposits, money market funds, and commercial paper. With the exception of our available-for-sale investments noted below, we value these investments at their original purchase prices plus interest that has accrued at the stated rate. Our available-for-sale securities are comprised of investments in debt securities. These securities are recorded at fair value using market prices. As of November 3, 2018 , the Company held $296 million of available-for-sale securities with maturity dates greater than three months and less than two years within short-term investments on the Condensed Consolidated Balance Sheets. In addition, as of November 3, 2018 , the Company held $6 million of available-for-sale debt securities with maturities of less than three months at the time of purchase within cash and cash equivalents on the Condensed Consolidated Balance Sheets. Unrealized gains or losses on available-for-sale debt securities included in accumulated other comprehensive income were immaterial as of November 3, 2018 . The Company regularly reviews its available-for-sale debt securities for other-than-temporary impairment. For the thirteen and thirty-nine weeks ended November 3, 2018 , the Company did not consider any of its securities to be other-than-temporarily impaired and, accordingly, did not recognize any impairment loss. Derivative financial instruments primarily include foreign exchange forward contracts. The currencies hedged against changes in the U.S. dollar are Canadian dollars, Japanese yen, British pounds, Euro, Mexican pesos, Taiwan dollars, and Chinese yuan. The fair value of the Company’s derivative financial instruments is determined using pricing models based on current market rates. Derivative financial instruments in an asset position are recorded in other current assets or other long-term assets on the Condensed Consolidated Balance Sheets. Derivative financial instruments in a liability position are recorded in accrued expenses and other current liabilities or lease incentives and other long-term liabilities on the Condensed Consolidated Balance Sheets. We maintain the Gap Inc. Deferred Compensation Plan (“DCP”), which allows eligible employees and non-employee directors to defer base compensation up to a maximum percentage. Plan investments are directed by participants and are recorded at market value and designated for the DCP. The fair value of the Company’s DCP assets is determined based on quoted market prices, and the assets are recorded in other long-term assets on the Condensed Consolidated Balance Sheets. Nonfinancial Assets We review the carrying amount of long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The fair value of the long-lived assets is determined using level 3 inputs and based on discounted future cash flows of the asset or asset group using a discount rate commensurate with the risk. The asset group is defined as the lowest level for which identifiable cash flows are available and largely independent of the cash flows of other groups of assets, which for our retail stores is primarily at the store level. There were no material impairment charges recorded for long-lived assets for the thirteen and thirty-nine weeks ended November 3, 2018 . There were no material impairment charges recorded for long-lived assets for the thirteen weeks ended October 28, 2017 . During the thirty-nine weeks ended October 28, 2017 , we recorded a charge for the impairment of long-lived assets of $17 million . The impairment charge was recorded in operating expenses in the Condensed Consolidated Statement of Income and reduced the then carrying amount of the applicable long-lived assets of $18 million to their fair value of $1 million . We review the carrying amount of goodwill and other indefinite-lived intangible assets for impairment annually and whenever events or changes in circumstances indicate that it is more likely than not that the carrying amount may not be recoverable. There were no material impairment charges recorded for goodwill or other indefinite-lived intangible assets for the thirteen and thirty-nine weeks ended November 3, 2018 or October 28, 2017 . |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Nov. 03, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments We operate in foreign countries, which exposes us to market risk associated with foreign currency exchange rate fluctuations. We use derivative financial instruments to manage our exposure to foreign currency exchange rate risk and do not enter into derivative financial contracts for trading purposes. Consistent with our risk management guidelines, we hedge a portion of our transactions related to merchandise purchases for foreign operations and certain intercompany transactions using foreign exchange forward contracts. These contracts are entered into with large, reputable financial institutions that are monitored for counterparty risk. The currencies hedged against changes in the U.S. dollar are Canadian dollars, Japanese yen, British pounds, Euro, Mexican pesos, Taiwan dollars and Chinese yuan. Cash flows from derivative financial instruments are classified as cash flows from operating activities in the Condensed Consolidated Statements of Cash Flows. Cash Flow Hedges We designate the following foreign exchange forward contracts as cash flow hedges: (1) forward contracts used to hedge forecasted merchandise purchases and related costs denominated in U.S. dollars made by our international subsidiaries whose functional currencies are their local currencies; (2) forward contracts used to hedge forecasted intercompany royalty payments denominated in foreign currencies received by entities whose functional currencies are U.S. dollars; and (3) forward contracts used to hedge forecasted intercompany revenue transactions related to merchandise sold from our regional purchasing entity, whose functional currency is the U.S. dollar, to certain international subsidiaries in their local currencies. The foreign exchange forward contracts entered into to hedge forecasted merchandise purchases and related costs, intercompany royalty payments, and intercompany revenue transactions generally have terms of up to 24 months. The effective portion of the gain or loss on the derivative financial instruments is reported as a component of other comprehensive income and is recognized in income in the period in which the underlying transaction impacts the Condensed Consolidated Statements of Income. Net Investment Hedges We may also use foreign exchange forward contracts to hedge the net assets of international subsidiaries to offset the foreign currency translation and economic exposures related to our investment in these subsidiaries. Other Derivatives Not Designated as Hedging Instruments We use foreign exchange forward contracts to hedge our market risk exposure associated with foreign currency exchange rate fluctuations for certain intercompany balances denominated in currencies other than the functional currency of the entity with the intercompany balance. The gain or loss on the derivative financial instruments that represent economic hedges, as well as the remeasurement impact of the underlying intercompany balances, is recorded in operating expenses in the Condensed Consolidated Statements of Income in the same period and generally offset each other. Outstanding Notional Amounts We had foreign exchange forward contracts outstanding in the following notional amounts: ($ in millions) November 3, February 3, October 28, Derivatives designated as cash flow hedges $ 815 $ 745 $ 873 Derivatives designated as net investment hedges — — 30 Derivatives not designated as hedging instruments 717 577 581 Total $ 1,532 $ 1,322 $ 1,484 Quantitative Disclosures about Derivative Financial Instruments The fair values of foreign exchange forward contracts are as follows: ($ in millions) November 3, February 3, October 28, Derivatives designated as cash flow hedges: Other current assets $ 21 $ 11 $ 16 Other long-term assets $ 5 $ — $ 4 Accrued expenses and other current liabilities $ 1 $ 32 $ 11 Lease incentives and other long-term liabilities $ — $ — $ 2 Derivatives designated as net investment hedges: Other current assets $ — $ — $ — Other long-term assets $ — $ — $ — Accrued expenses and other current liabilities $ — $ — $ 2 Lease incentives and other long-term liabilities $ — $ — $ — Derivatives not designated as hedging instruments: Other current assets $ 20 $ 3 $ 11 Other long-term assets $ — $ — $ — Accrued expenses and other current liabilities $ — $ 11 $ 5 Lease incentives and other long-term liabilities $ — $ — $ — Total derivatives in an asset position $ 46 $ 14 $ 31 Total derivatives in a liability position $ 1 $ 43 $ 20 The majority of the unrealized gains and losses from designated cash flow hedges as of November 3, 2018 , will be recognized in income within the next 12 months at the then-current values, which may differ from the fair values as of November 3, 2018 , shown above. Our foreign exchange forward contracts are subject to master netting arrangements with each of our counterparties and such arrangements are enforceable in the event of default or early termination of the contract. We do not elect to offset the fair values of our derivative financial instruments on the Condensed Consolidated Balance Sheets, and as such, the fair values shown above represent gross amounts. The amounts subject to enforceable master netting arrangements are $1 million , $1 million , and $8 million as of November 3, 2018 , February 3, 2018 , and October 28, 2017 , respectively. If we did elect to offset, the net amounts of our derivative financial instruments in an asset position would be $45 million , $13 million , and $23 million and the net amounts of the derivative financial instruments in a liability position would be $0 , $42 million , and $12 million as of November 3, 2018 , February 3, 2018 , and October 28, 2017 , respectively. See Note 4 of Notes to Condensed Consolidated Financial Statements for disclosures on the fair value measurements of our derivative financial instruments. The effective portion of gains and losses on foreign exchange forward contracts in cash flow hedging and net investment hedging relationships recorded in other comprehensive income and the Condensed Consolidated Statements of Income, on a pre-tax basis, are as follows: 13 Weeks Ended 39 Weeks Ended ($ in millions) November 3, October 28, November 3, October 28, Derivatives in cash flow hedging relationships: Gain (loss) recognized in other comprehensive income $ 12 $ 25 $ 55 $ (26 ) Gain (loss) reclassified into cost of goods sold and occupancy expenses $ (8 ) $ (5 ) $ (5 ) $ 2 Gain (loss) reclassified into operating expenses $ — $ — $ — $ — Derivatives in net investment hedging relationships: Gain (loss) recognized in other comprehensive income $ — $ 1 $ — $ (1 ) For the thirteen and thirty-nine weeks ended November 3, 2018 and October 28, 2017 , there were no amounts of gains or losses reclassified from accumulated other comprehensive income into net income for derivative financial instruments in net investment hedging relationships, as we did not sell or liquidate (or substantially liquidate) any of our hedged subsidiaries during the periods. Gains and losses on foreign exchange forward contracts not designated as hedging instruments recorded in the Condensed Consolidated Statements of Income, on a pre-tax basis, are as follows: 13 Weeks Ended 39 Weeks Ended ($ in millions) November 3, October 28, November 3, October 28, Gain (loss) recognized in operating expenses $ 14 $ 10 $ 38 $ (13 ) |
Share Repurchases
Share Repurchases | 9 Months Ended |
Nov. 03, 2018 | |
Disclosure Share Repurchase Activity [Abstract] | |
Share Repurchases | Share Repurchases Share repurchase activity is as follows: 13 Weeks Ended 39 Weeks Ended ($ and shares in millions except average per share cost) November 3, October 28, November 3, October 28, Number of shares repurchased (1) 3.6 3.8 10.0 12.5 Total cost $ 100 $ 100 $ 300 $ 300 Average per share cost including commissions $ 28.09 $ 26.64 $ 30.01 $ 24.21 __________ (1) Excludes shares withheld to settle employee statutory tax withholding related to the vesting of stock units. In February 2016, the Board of Directors approved a $1.0 billion share repurchase authorization, of which $385 million was remaining as of November 3, 2018 . All of the share repurchases were paid for as of November 3, 2018 , February 3, 2018 , and October 28, 2017 . All common stock repurchased is immediately retired. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 9 Months Ended |
Nov. 03, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income | Accumulated Other Comprehensive Income Changes in accumulated other comprehensive income by component, net of tax, are as follows: ($ in millions) Foreign Currency Translation Cash Flow Hedges Total Balance at February 3, 2018 $ 64 $ (28 ) $ 36 13 Weeks Ended May 5, 2018: Foreign currency translation and other, net (7 ) — (7 ) Change in fair value of derivative financial instruments — 28 28 Amounts reclassified from accumulated other comprehensive income — (6 ) (6 ) Other comprehensive income (loss), net of tax (7 ) 22 15 Balance at May 5, 2018 57 (6 ) 51 13 Weeks Ended August 4, 2018: Foreign currency translation and other, net (16 ) — (16 ) Change in fair value of derivative financial instruments — 18 18 Amounts reclassified from accumulated other comprehensive income — — — Other comprehensive income (loss), net of tax (16 ) 18 2 Balance at August 4, 2018 41 12 53 13 Weeks Ended November 3, 2018: Foreign currency translation and other, net (4 ) — (4 ) Change in fair value of derivative financial instruments — 11 11 Amounts reclassified from accumulated other comprehensive income — (7 ) (7 ) Other comprehensive income (loss), net of tax (4 ) 4 — Balance at November 3, 2018 $ 37 $ 16 $ 53 ($ in millions) Foreign Currency Translation Cash Flow Hedges Total Balance at January 28, 2017 $ 29 $ 25 $ 54 13 Weeks Ended April 29, 2017: Foreign currency translation and other, net (4 ) — (4 ) Change in fair value of derivative financial instruments — — — Amounts reclassified from accumulated other comprehensive income — (4 ) (4 ) Other comprehensive loss, net of tax (4 ) (4 ) (8 ) Balance at April 29, 2017 25 21 46 13 Weeks Ended July 29, 2017: Foreign currency translation and other, net 21 — 21 Change in fair value of derivative financial instruments — (43 ) (43 ) Amounts reclassified from accumulated other comprehensive income — (1 ) (1 ) Other comprehensive income (loss), net of tax 21 (44 ) (23 ) Balance at July 29, 2017 46 (23 ) 23 13 Weeks Ended October 28, 2017: Foreign currency translation and other, net (5 ) — (5 ) Change in fair value of derivative financial instruments — 23 23 Amounts reclassified from accumulated other comprehensive income — (1 ) (1 ) Other comprehensive income (loss), net of tax (5 ) 22 17 Balance at October 28, 2017 $ 41 $ (1 ) $ 40 See Note 5 of Notes to Condensed Consolidated Financial Statements for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Condensed Consolidated Statements of Income. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Nov. 03, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation Share-based compensation expense recognized in the Condensed Consolidated Statements of Income, primarily in operating expenses, is as follows: 13 Weeks Ended 39 Weeks Ended ($ in millions) November 3, October 28, November 3, October 28, Stock units $ 19 $ 14 $ 57 $ 47 Stock options 4 3 12 10 Employee stock purchase plan 1 1 3 3 Share-based compensation expense 24 18 72 60 Less: Income tax benefit (6 ) (7 ) (17 ) (23 ) Share-based compensation expense, net of tax $ 18 $ 11 $ 55 $ 37 |
Income Taxes
Income Taxes | 9 Months Ended |
Nov. 03, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The effective income tax rate was 24.0 percent for the thirteen weeks ended November 3, 2018 , compared with 37.1 percent for the thirteen weeks ended October 28, 2017 . The effective income tax rate was 24.0 percent for the thirty-nine weeks ended November 3, 2018 , compared with 38.2 percent for the thirty-nine weeks ended October 28, 2017 . The decrease in the effective tax rates was primarily due to the reduction in the U.S. federal statutory tax rate from 35 percent to 21 percent , enacted as part of the Tax Cuts and Jobs Act of 2017 (the “TCJA”), and measurement period adjustments to reduce our fiscal 2017 estimated net charge for the effects of the TCJA, offset by increases in unrecognized tax benefits recorded in connection with examinations by taxing authorities. On December 22, 2017, the Securities and Exchange Commission (“SEC”) issued SEC Staff Accounting Bulletin (“SAB”) No. 118 to address the application of FASB ASC Topic 740, Income Taxes, in reporting periods that include December 22, 2017. SAB No. 118, codified under ASU 2018-05 in March 2018, permits organizations to report provisional amounts during a measurement period for the specific income tax effects of the TCJA for which the accounting under ASC Topic 740 will be incomplete but a reasonable estimate can be determined. The measurement period ends when an organization has obtained, prepared and analyzed the information needed to complete the accounting requirements under ASC Topic 740, not to extend beyond one year from the enactment date of the TCJA. During the fourteen weeks ended February 3, 2018, we recorded an estimated net charge of $57 million for the effects of the enactment of TCJA, primarily due to the impact of the one-time transition tax on the deemed repatriation of foreign income and the impact of TCJA on deferred tax assets and liabilities. During the thirteen and thirty-nine weeks ended November 3, 2018, we recorded a $33 million measurement period adjustment to reduce our fiscal 2017 provisional estimated net charge related to the transition tax and recorded certain immaterial measurement period adjustments to reduce our fiscal 2017 provisional estimated impact of the remeasurement of our deferred tax assets and liabilities to reflect the TCJA rate reduction. We will continue to evaluate the TCJA and interpret additional guidance issued by the U.S. Treasury Department and Internal Revenue Service (“IRS”), including the proposed regulations regarding the computation of the one-time transition tax on the deemed repatriation of foreign income and the proposed regulations regarding the deduction of certain executive compensation. In accordance with SAB No. 118, we will complete our accounting for the tax effects of the TCJA during fiscal 2018 and adjustments to our provisional estimated net charge may materially impact our provision for income taxes and effective tax rate for fiscal 2018. The TCJA includes a provision to tax global intangible low-taxed income (“GILTI”) of foreign subsidiaries, a base erosion anti-abuse tax (“BEAT”) measure that taxes certain payments between a U.S. corporation and its subsidiaries, and favorable tax treatment for certain Foreign Derived Intangible Income (“FDII”), effective for us beginning fiscal 2018. Our provisional estimates for GILTI, BEAT, and FDII do not materially impact our effective income tax rate for the thirteen and thirty-nine weeks ended November 3, 2018. The Company conducts business globally, and as a result, files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. In the normal course of business, we are subject to examination by taxing authorities throughout the world, including such major jurisdictions as the United States, Canada, France, the United Kingdom, China, Hong Kong, Japan, and India. We are no longer subject to U.S. federal income tax examinations for fiscal years before 2009, and with few exceptions, we are also no longer subject to U.S. state, local, or non-U.S. income tax examinations for fiscal years before 2008. The Company is in continual discussions with taxing authorities regarding tax matters in the various U.S. and foreign jurisdictions in the normal course of business. As of November 3, 2018, it is reasonably possible that we will recognize a decrease in gross unrecognized tax benefits within the next 12 months of up to $4 million , primarily due to the closing of audits. If we do recognize such a decrease in gross unrecognized tax benefits, the net impact on the Condensed Consolidated Statements of Income would not be material. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Nov. 03, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Weighted-average number of shares used for earnings per share is as follows: 13 Weeks Ended 39 Weeks Ended (shares in millions) November 3, October 28, November 3, October 28, Weighted-average number of shares - basic 384 391 387 395 Common stock equivalents 3 2 3 2 Weighted-average number of shares - diluted 387 393 390 397 The above computations of weighted-average number of shares – diluted exclude 7 million and 9 million shares related to stock options and other stock awards for the thirteen weeks ended November 3, 2018 and October 28, 2017 , respectively, and 6 million and 9 million shares related to stock options and other stock awards for the thirty-nine weeks ended November 3, 2018 and October 28, 2017 , respectively, as their inclusion would have an anti-dilutive effect on earnings per share. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Nov. 03, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies We are a party to a variety of contractual agreements under which we may be obligated to indemnify the other party for certain matters. These contracts primarily relate to our commercial contracts, operating leases, trademarks, intellectual property, financial agreements, and various other agreements. Under these contracts, we may provide certain routine indemnifications relating to representations and warranties (e.g., ownership of assets, environmental or tax indemnifications), or personal injury matters. The terms of these indemnifications range in duration and may not be explicitly defined. Generally, the maximum obligation under such indemnifications is not explicitly stated, and as a result, the overall amount of these obligations cannot be reasonably estimated. Historically, we have not made significant payments for these indemnifications. We believe that if we were to incur a loss in any of these matters, the loss would not have a material effect on our Condensed Consolidated Financial Statements taken as a whole. As a multinational company, we are subject to various proceedings, lawsuits, disputes, and claims (“Actions”) arising in the ordinary course of our business. Many of these Actions raise complex factual and legal issues and are subject to uncertainties. As of November 3, 2018 , Actions filed against us included commercial, intellectual property, customer, employment, and data privacy claims, including class action lawsuits. The plaintiffs in some Actions seek unspecified damages or injunctive relief, or both. Actions are in various procedural stages and some are covered in part by insurance. As of November 3, 2018 , February 3, 2018 , and October 28, 2017 , we recorded a liability for an estimated loss if the outcome of an Action is expected to result in a loss that is considered probable and reasonably estimable. The liability recorded as of November 3, 2018 , February 3, 2018 , and October 28, 2017 was not material for any individual Action or in total. Subsequent to November 3, 2018 and through the filing date of this Quarterly Report on Form 10-Q, no information has become available that indicates a change is required that would be material to our Condensed Consolidated Financial Statements taken as a whole. We cannot predict with assurance the outcome of Actions brought against us. Accordingly, developments, settlements, or resolutions may occur and impact income in the quarter of such development, settlement, or resolution. However, we do not believe that the outcome of any current Action would have a material effect on our Condensed Consolidated Financial Statements taken as a whole. Fire at the Fishkill Distribution Center On August 29, 2016, a fire occurred in one of the buildings at a Company-owned distribution center campus in Fishkill, New York. The Company maintains property and business interruption insurance coverage and, based on the provisions of the Company’s insurance policies, the Company recorded insurance recoveries based on the determination that recovery of certain fire-related costs was probable. In January 2018, the Company agreed upon a final settlement with its insurers. During the thirty-nine weeks ended October 28, 2017 , we allocated $60 million of advance payments of insurance proceeds to the loss on property and equipment based on the estimated recovery of certain fire-related costs, and the amount has been reported as insurance proceeds allocated to loss on property and equipment, a component of cash flows from investing activities, in the Condensed Consolidated Statement of Cash Flows. |
Segment Information
Segment Information | 9 Months Ended |
Nov. 03, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We identify our operating segments according to how our business activities are managed and evaluated. As of November 3, 2018 , our operating segments included Old Navy Global, Gap Global, Banana Republic Global, Athleta, and Intermix. We have determined that each of our operating segments share similar economic and other qualitative characteristics, and therefore the results of our operating segments are aggregated into one reportable segment as of November 3, 2018 . Net sales by brand and region are as follows: ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 13 Weeks Ended November 3, 2018 (1) U.S. (2) $ 1,769 $ 738 $ 510 $ 257 $ 3,274 80 % Canada 152 104 59 1 316 8 Europe — 145 4 — 149 4 Asia 13 266 21 — 300 7 Other regions 13 30 7 — 50 1 Total $ 1,947 $ 1,283 $ 601 $ 258 $ 4,089 100 % ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 13 Weeks Ended October 28, 2017 (1) U.S. (2) $ 1,587 $ 750 $ 467 $ 200 $ 3,004 79 % Canada 143 109 57 1 310 8 Europe — 154 4 — 158 4 Asia 13 278 21 — 312 8 Other regions 15 31 8 — 54 1 Total $ 1,758 $ 1,322 $ 557 $ 201 $ 3,838 100 % ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 39 Weeks Ended November 3, 2018 (1) U.S. (2) $ 5,175 $ 2,146 $ 1,503 $ 790 $ 9,614 81 % Canada 430 275 167 2 874 7 Europe — 425 11 — 436 4 Asia 36 779 68 — 883 7 Other regions 43 87 20 — 150 1 Total $ 5,684 $ 3,712 $ 1,769 $ 792 $ 11,957 100 % ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 39 Weeks Ended October 28, 2017 (1) U.S. (2) $ 4,609 $ 2,137 $ 1,396 $ 633 $ 8,775 79 % Canada 387 277 156 2 822 8 Europe — 435 11 — 446 4 Asia 34 780 69 — 883 8 Other regions 47 83 21 — 151 1 Total $ 5,077 $ 3,712 $ 1,653 $ 635 $ 11,077 100 % __________ (1) Net sales for the thirteen and thirty-nine weeks ended November 3, 2018 reflect the adoption of the new revenue recognition standard, which resulted in an increase to net sales of $170 million and $449 million , respectively, for revenue sharing and reimbursements of loyalty program discounts associated with the Company's credit card programs, as well as breakage revenue for our gift cards and credit vouchers. Prior period amounts have not been restated and continue to be reported under accounting standards in effect for those periods. (2) U.S. includes the United States, Puerto Rico, and Guam. (3) Primarily consists of net sales for the Athleta and Intermix brands. Beginning in the third quarter of fiscal 2018, the Hill City brand is also included. Net sales by region are allocated based on the location of the store where the customer paid for and received the merchandise or the distribution center or store from which the products were shipped. |
Accounting Policies Accounting
Accounting Policies Accounting Pronouncements Recently Adopted (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within our Condensed Consolidated Balance Sheets to the total shown in our Condensed Consolidated Statements of Cash Flows: ($ in millions) November 3, February 3, October 28, Cash and cash equivalents $ 958 $ 1,783 $ 1,353 Restricted cash included in other current assets 1 1 1 Restricted cash included in other long-term assets 17 15 16 Total cash, cash equivalents, and restricted cash shown in the Condensed Consolidated Statement of Cash Flows $ 976 $ 1,799 $ 1,370 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
Fair Value Disclosures [Abstract] | |
Financial Assets And Liabilities Measured At Fair Value On Recurring Basis | Financial assets and liabilities measured at fair value on a recurring basis and cash equivalents are as follows: Fair Value Measurements at Reporting Date Using ($ in millions) November 3, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 438 $ 30 $ 408 $ — Short-term investments 296 124 172 — Derivative financial instruments 46 — 46 — Deferred compensation plan assets 49 49 — — Total $ 829 $ 203 $ 626 $ — Liabilities: Derivative financial instruments $ 1 $ — $ 1 $ — Fair Value Measurements at Reporting Date Using ($ in millions) February 3, 2018 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 527 $ 37 $ 490 $ — Derivative financial instruments 14 — 14 — Deferred compensation plan assets 47 47 — — Total $ 588 $ 84 $ 504 $ — Liabilities: Derivative financial instruments $ 43 $ — $ 43 $ — Fair Value Measurements at Reporting Date Using ($ in millions) October 28, 2017 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 389 $ 28 $ 361 $ — Derivative financial instruments 31 — 31 — Deferred compensation plan assets 46 46 — — Total $ 466 $ 74 $ 392 $ — Liabilities: Derivative financial instruments $ 20 $ — $ 20 $ — |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Foreign Exchange Forward Contracts Outstanding | We had foreign exchange forward contracts outstanding in the following notional amounts: ($ in millions) November 3, February 3, October 28, Derivatives designated as cash flow hedges $ 815 $ 745 $ 873 Derivatives designated as net investment hedges — — 30 Derivatives not designated as hedging instruments 717 577 581 Total $ 1,532 $ 1,322 $ 1,484 |
Fair Values of Asset and Liability Derivative Financial Instruments | The fair values of foreign exchange forward contracts are as follows: ($ in millions) November 3, February 3, October 28, Derivatives designated as cash flow hedges: Other current assets $ 21 $ 11 $ 16 Other long-term assets $ 5 $ — $ 4 Accrued expenses and other current liabilities $ 1 $ 32 $ 11 Lease incentives and other long-term liabilities $ — $ — $ 2 Derivatives designated as net investment hedges: Other current assets $ — $ — $ — Other long-term assets $ — $ — $ — Accrued expenses and other current liabilities $ — $ — $ 2 Lease incentives and other long-term liabilities $ — $ — $ — Derivatives not designated as hedging instruments: Other current assets $ 20 $ 3 $ 11 Other long-term assets $ — $ — $ — Accrued expenses and other current liabilities $ — $ 11 $ 5 Lease incentives and other long-term liabilities $ — $ — $ — Total derivatives in an asset position $ 46 $ 14 $ 31 Total derivatives in a liability position $ 1 $ 43 $ 20 |
Effects of Derivative Financial Instruments on OCI and Condensed Consolidated Statements of Income | The effective portion of gains and losses on foreign exchange forward contracts in cash flow hedging and net investment hedging relationships recorded in other comprehensive income and the Condensed Consolidated Statements of Income, on a pre-tax basis, are as follows: 13 Weeks Ended 39 Weeks Ended ($ in millions) November 3, October 28, November 3, October 28, Derivatives in cash flow hedging relationships: Gain (loss) recognized in other comprehensive income $ 12 $ 25 $ 55 $ (26 ) Gain (loss) reclassified into cost of goods sold and occupancy expenses $ (8 ) $ (5 ) $ (5 ) $ 2 Gain (loss) reclassified into operating expenses $ — $ — $ — $ — Derivatives in net investment hedging relationships: Gain (loss) recognized in other comprehensive income $ — $ 1 $ — $ (1 ) |
Derivatives Not Designated as Hedging Instruments [Table Text Block] | Gains and losses on foreign exchange forward contracts not designated as hedging instruments recorded in the Condensed Consolidated Statements of Income, on a pre-tax basis, are as follows: 13 Weeks Ended 39 Weeks Ended ($ in millions) November 3, October 28, November 3, October 28, Gain (loss) recognized in operating expenses $ 14 $ 10 $ 38 $ (13 ) |
Share Repurchases (Tables)
Share Repurchases (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
Disclosure Share Repurchase Activity [Abstract] | |
Share Repurchase Activity | Share repurchase activity is as follows: 13 Weeks Ended 39 Weeks Ended ($ and shares in millions except average per share cost) November 3, October 28, November 3, October 28, Number of shares repurchased (1) 3.6 3.8 10.0 12.5 Total cost $ 100 $ 100 $ 300 $ 300 Average per share cost including commissions $ 28.09 $ 26.64 $ 30.01 $ 24.21 __________ (1) Excludes shares withheld to settle employee statutory tax withholding related to the vesting of stock units. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Changes in Accumulated Other Comprehensive Income by Component | Changes in accumulated other comprehensive income by component, net of tax, are as follows: ($ in millions) Foreign Currency Translation Cash Flow Hedges Total Balance at February 3, 2018 $ 64 $ (28 ) $ 36 13 Weeks Ended May 5, 2018: Foreign currency translation and other, net (7 ) — (7 ) Change in fair value of derivative financial instruments — 28 28 Amounts reclassified from accumulated other comprehensive income — (6 ) (6 ) Other comprehensive income (loss), net of tax (7 ) 22 15 Balance at May 5, 2018 57 (6 ) 51 13 Weeks Ended August 4, 2018: Foreign currency translation and other, net (16 ) — (16 ) Change in fair value of derivative financial instruments — 18 18 Amounts reclassified from accumulated other comprehensive income — — — Other comprehensive income (loss), net of tax (16 ) 18 2 Balance at August 4, 2018 41 12 53 13 Weeks Ended November 3, 2018: Foreign currency translation and other, net (4 ) — (4 ) Change in fair value of derivative financial instruments — 11 11 Amounts reclassified from accumulated other comprehensive income — (7 ) (7 ) Other comprehensive income (loss), net of tax (4 ) 4 — Balance at November 3, 2018 $ 37 $ 16 $ 53 ($ in millions) Foreign Currency Translation Cash Flow Hedges Total Balance at January 28, 2017 $ 29 $ 25 $ 54 13 Weeks Ended April 29, 2017: Foreign currency translation and other, net (4 ) — (4 ) Change in fair value of derivative financial instruments — — — Amounts reclassified from accumulated other comprehensive income — (4 ) (4 ) Other comprehensive loss, net of tax (4 ) (4 ) (8 ) Balance at April 29, 2017 25 21 46 13 Weeks Ended July 29, 2017: Foreign currency translation and other, net 21 — 21 Change in fair value of derivative financial instruments — (43 ) (43 ) Amounts reclassified from accumulated other comprehensive income — (1 ) (1 ) Other comprehensive income (loss), net of tax 21 (44 ) (23 ) Balance at July 29, 2017 46 (23 ) 23 13 Weeks Ended October 28, 2017: Foreign currency translation and other, net (5 ) — (5 ) Change in fair value of derivative financial instruments — 23 23 Amounts reclassified from accumulated other comprehensive income — (1 ) (1 ) Other comprehensive income (loss), net of tax (5 ) 22 17 Balance at October 28, 2017 $ 41 $ (1 ) $ 40 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation Expense | Share-based compensation expense recognized in the Condensed Consolidated Statements of Income, primarily in operating expenses, is as follows: 13 Weeks Ended 39 Weeks Ended ($ in millions) November 3, October 28, November 3, October 28, Stock units $ 19 $ 14 $ 57 $ 47 Stock options 4 3 12 10 Employee stock purchase plan 1 1 3 3 Share-based compensation expense 24 18 72 60 Less: Income tax benefit (6 ) (7 ) (17 ) (23 ) Share-based compensation expense, net of tax $ 18 $ 11 $ 55 $ 37 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
Earnings Per Share [Abstract] | |
Weighted-Average Number of Shares | Weighted-average number of shares used for earnings per share is as follows: 13 Weeks Ended 39 Weeks Ended (shares in millions) November 3, October 28, November 3, October 28, Weighted-average number of shares - basic 384 391 387 395 Common stock equivalents 3 2 3 2 Weighted-average number of shares - diluted 387 393 390 397 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Nov. 03, 2018 | |
Segment Reporting [Abstract] | |
Net Sales by Brand and Region | Net sales by brand and region are as follows: ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 13 Weeks Ended November 3, 2018 (1) U.S. (2) $ 1,769 $ 738 $ 510 $ 257 $ 3,274 80 % Canada 152 104 59 1 316 8 Europe — 145 4 — 149 4 Asia 13 266 21 — 300 7 Other regions 13 30 7 — 50 1 Total $ 1,947 $ 1,283 $ 601 $ 258 $ 4,089 100 % ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 13 Weeks Ended October 28, 2017 (1) U.S. (2) $ 1,587 $ 750 $ 467 $ 200 $ 3,004 79 % Canada 143 109 57 1 310 8 Europe — 154 4 — 158 4 Asia 13 278 21 — 312 8 Other regions 15 31 8 — 54 1 Total $ 1,758 $ 1,322 $ 557 $ 201 $ 3,838 100 % ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 39 Weeks Ended November 3, 2018 (1) U.S. (2) $ 5,175 $ 2,146 $ 1,503 $ 790 $ 9,614 81 % Canada 430 275 167 2 874 7 Europe — 425 11 — 436 4 Asia 36 779 68 — 883 7 Other regions 43 87 20 — 150 1 Total $ 5,684 $ 3,712 $ 1,769 $ 792 $ 11,957 100 % ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total Percentage of Net Sales 39 Weeks Ended October 28, 2017 (1) U.S. (2) $ 4,609 $ 2,137 $ 1,396 $ 633 $ 8,775 79 % Canada 387 277 156 2 822 8 Europe — 435 11 — 446 4 Asia 34 780 69 — 883 8 Other regions 47 83 21 — 151 1 Total $ 5,077 $ 3,712 $ 1,653 $ 635 $ 11,077 100 % __________ (1) Net sales for the thirteen and thirty-nine weeks ended November 3, 2018 reflect the adoption of the new revenue recognition standard, which resulted in an increase to net sales of $170 million and $449 million , respectively, for revenue sharing and reimbursements of loyalty program discounts associated with the Company's credit card programs, as well as breakage revenue for our gift cards and credit vouchers. Prior period amounts have not been restated and continue to be reported under accounting standards in effect for those periods. (2) U.S. includes the United States, Puerto Rico, and Guam. (3) Primarily consists of net sales for the Athleta and Intermix brands. Beginning in the third quarter of fiscal 2018, the Hill City brand is also included. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||
Nov. 03, 2018 | Nov. 03, 2018 | Aug. 04, 2018 | Feb. 03, 2018 | Oct. 28, 2017 | Jan. 28, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Cash and cash equivalents | $ 958 | $ 958 | $ 1,783 | $ 1,353 | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents end of period | 976 | 976 | 1,799 | 1,370 | $ 1,797 | |
Contract with Customer Liabilities for Franchise Agreements | 0 | 0 | ||||
Credit Card Revenue | 170 | 449 | ||||
Accrued expenses and other current liabilities | 1,070 | 1,070 | 1,270 | 1,132 | ||
Other current assets | 792 | 792 | 788 | 654 | ||
Revenue Sharing from Credit Card Programs and Breakage for Gift Cards and Credit Vouchers [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Credit Card Revenue | 128 | 320 | ||||
Loyalty Program Discount Reimbursements [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Credit Card Revenue | 42 | 129 | ||||
Accounting Standards Update 2014-09 [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Cumulative Effect of New Accounting Principle in Period of Adoption | 36 | 36 | ||||
Contract with Customer, Liability | 193 | 193 | $ 194 | 232 | ||
Contract with Customer, Liability, Revenue Recognized | 84 | 170 | ||||
Customer Refund Liability, Current | 103 | 103 | ||||
Other current assets | 44 | 44 | ||||
Accounting Standards Update 2016-18 [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Cash and cash equivalents | 958 | 958 | 1,783 | 1,353 | ||
Restricted Cash, Current | 1 | 1 | 1 | 1 | ||
Restricted Cash, Noncurrent | 17 | 17 | 15 | 16 | ||
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents end of period | 976 | 976 | $ 1,799 | $ 1,370 | ||
Calculated under Revenue Guidance in Effect before Topic 606 [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Sales return allowance | 57 | 57 | ||||
Difference between Revenue Guidance in Effect before and after Topic 606 [Member] | ||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Accrued expenses and other current liabilities | 46 | 46 | ||||
Right of return asset | $ 44 | $ 44 |
Debt and Credit Facilities Long
Debt and Credit Facilities Long Term Debt (Details) - USD ($) $ in Millions | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 |
Debt Instrument [Line Items] | |||
Total long-term debt | $ 1,249 | $ 1,249 | $ 1,248 |
Debt and Credit Facilities - Ad
Debt and Credit Facilities - Additional Information (Details) $ in Millions, ¥ in Billions | 3 Months Ended | 9 Months Ended | ||
Apr. 29, 2017JPY (¥) | Nov. 03, 2018USD ($) | Feb. 03, 2018USD ($) | Oct. 28, 2017USD ($) | |
5.95 Percent Notes Due April 2021 | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount of notes issued | $ 1,250 | |||
Notes, interest rate | 5.95% | |||
Estimated fair value | $ 1,290 | $ 1,330 | $ 1,350 | |
Notes, maturity date | Apr. 12, 2021 | |||
Japan Term Loan [Member] | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount of notes issued | ¥ | ¥ 15 | |||
Debt Instrument, Term | 4 years | |||
Notes, maturity date | Jan. 15, 2018 | |||
Foreign Facilities [Member] | ||||
Debt Instrument [Line Items] | ||||
Maximum borrowing capacity | $ 56 | |||
Borrowings | 0 | |||
Bank guarantees related to store leases | 15 | |||
Standby Letters of Credit [Member] | ||||
Debt Instrument [Line Items] | ||||
Unsecured committed letter of credit amount | $ 13 | |||
Five-Year Unsecured Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Term | 5 years | |||
Maximum borrowing capacity | $ 500 | |||
Unsecured committed letter of credit amount | 0 | |||
Borrowings | $ 0 | |||
Expiration date | May 1, 2023 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 |
Assets: | |||
Cash equivalents | $ 438 | $ 527 | $ 389 |
Investments, Fair Value Disclosure | 296 | ||
Derivative financial instruments | 46 | 14 | 31 |
Deferred compensation plan assets | 49 | 47 | 46 |
Assets, Fair Value Disclosure | 829 | 588 | 466 |
Liabilities: | |||
Derivative financial instruments | 1 | 43 | 20 |
Fair Value, Inputs, Level 1 [Member] | |||
Assets: | |||
Cash equivalents | 30 | 37 | 28 |
Investments, Fair Value Disclosure | 124 | ||
Derivative financial instruments | 0 | 0 | 0 |
Deferred compensation plan assets | 49 | 47 | 46 |
Assets, Fair Value Disclosure | 203 | 84 | 74 |
Liabilities: | |||
Derivative financial instruments | 0 | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | |||
Assets: | |||
Cash equivalents | 408 | 490 | 361 |
Investments, Fair Value Disclosure | 172 | ||
Derivative financial instruments | 46 | 14 | 31 |
Deferred compensation plan assets | 0 | 0 | 0 |
Assets, Fair Value Disclosure | 626 | 504 | 392 |
Liabilities: | |||
Derivative financial instruments | 1 | 43 | 20 |
Fair Value, Inputs, Level 3 [Member] | |||
Assets: | |||
Cash equivalents | 0 | 0 | 0 |
Investments, Fair Value Disclosure | 0 | ||
Derivative financial instruments | 0 | 0 | 0 |
Deferred compensation plan assets | 0 | 0 | 0 |
Assets, Fair Value Disclosure | 0 | 0 | 0 |
Liabilities: | |||
Derivative financial instruments | $ 0 | $ 0 | $ 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | Feb. 03, 2018 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Other indefinite-lived intangible assets impairment charges | $ 0 | $ 0 | $ 0 | $ 0 | |
Other long-lived asset impairment charges | 0 | 0 | 0 | 17,000,000 | |
Long Lived Asset at Carrying Value | 18,000,000 | 18,000,000 | |||
Impaired other assets fair value | 1,000,000 | 1,000,000 | |||
Goodwill impairment charges | 0 | 0 | 0 | 0 | |
Transfers into or out of level 2 | 0 | 0 | 0 | 0 | |
Transfers into or out of level 1 | 0 | 0 | 0 | 0 | |
Purchases, sales, issuances, or settlements related to recurring level 3 measurements | 0 | 0 | $ 0 | 0 | |
Document Period End Date | Nov. 3, 2018 | ||||
Available-for-sale Securities, Current | 296,000,000 | $ 0 | $ 296,000,000 | $ 0 | $ 0 |
Cash and Cash Equivalents, Fair Value Disclosure | 6,000,000 | 6,000,000 | |||
Debt Securities, Available-for-sale, Unrealized Gain (Loss) | 0 | ||||
Other-than-temporary Impairment Loss, Debt Securities, Available-for-sale | $ 0 | $ 0 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Foreign Exchange Contracts Outstanding to Sell Various Currencies (Details) - USD ($) $ in Millions | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 |
Derivative [Line Items] | |||
Derivative, Notional Amount | $ 1,532 | $ 1,322 | $ 1,484 |
Derivatives in cash flow hedging relationships | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | 815 | 745 | 873 |
Derivatives in net investment hedging relationships | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | 0 | 0 | 30 |
Not Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | $ 717 | $ 577 | $ 581 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Fair Values of Asset and Liability Derivative Financial Instruments (Details) - USD ($) $ in Millions | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 |
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | $ 46 | $ 14 | $ 31 |
Derivative financial instruments, liabilities | 1 | 43 | 20 |
Foreign Exchange Forward Contract | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 46 | 14 | 31 |
Derivative financial instruments, liabilities | 1 | 43 | 20 |
Derivatives in cash flow hedging relationships | Foreign Exchange Forward Contract | Other Current Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 21 | 11 | 16 |
Derivatives in cash flow hedging relationships | Foreign Exchange Forward Contract | Other Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 5 | 0 | 4 |
Derivatives in cash flow hedging relationships | Foreign Exchange Forward Contract | Accrued Liabilities Current [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | 1 | 32 | 11 |
Derivatives in cash flow hedging relationships | Foreign Exchange Forward Contract | Lease Incentive And Other Long Term Liabilities [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | 0 | 0 | 2 |
Derivatives in net investment hedging relationships | Foreign Exchange Forward Contract | Other Current Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 0 | 0 | 0 |
Derivatives in net investment hedging relationships | Foreign Exchange Forward Contract | Other Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 0 | 0 | 0 |
Derivatives in net investment hedging relationships | Foreign Exchange Forward Contract | Accrued Liabilities Current [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | 0 | 0 | 2 |
Derivatives in net investment hedging relationships | Foreign Exchange Forward Contract | Lease Incentive And Other Long Term Liabilities [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | 0 | 0 | 0 |
Not Designated as Hedging Instrument | Foreign Exchange Forward Contract | Other Current Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 20 | 3 | 11 |
Not Designated as Hedging Instrument | Foreign Exchange Forward Contract | Other Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 0 | 0 | 0 |
Not Designated as Hedging Instrument | Foreign Exchange Forward Contract | Accrued Liabilities Current [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | 0 | 11 | 5 |
Not Designated as Hedging Instrument | Foreign Exchange Forward Contract | Lease Incentive And Other Long Term Liabilities [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | $ 0 | $ 0 | $ 0 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Effects Of Derivative Financial Instruments On OCI And Condensed Consolidated Statements Of Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | |
Derivatives in net investment hedging relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) reclassified from accumulated OCI into income, effective portion, net | $ 0 | $ 0 | $ 0 | $ 0 |
Foreign Exchange Forward Contract | Derivatives in cash flow hedging relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative instruments, gain (loss) recognized in OCI, effective portion, net | 12 | 25 | 55 | (26) |
Foreign Exchange Forward Contract | Derivatives in net investment hedging relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Derivative instruments, gain (loss) recognized in OCI, effective portion, net | 0 | 1 | 0 | (1) |
Foreign Exchange Forward Contract | Cost of Goods Sold and Occupancy Expense | Derivatives in cash flow hedging relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) reclassified from accumulated OCI into income, effective portion, net | (8) | (5) | (5) | 2 |
Foreign Exchange Forward Contract | Operating Expenses [Member] | Not Designated as Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amounts of gain (loss) recognized in income on derivatives | 14 | 10 | 38 | (13) |
Foreign Exchange Forward Contract | Operating Expenses [Member] | Derivatives in cash flow hedging relationships | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Gain (loss) reclassified from accumulated OCI into income, effective portion, net | $ 0 | $ 0 | $ 0 | $ 0 |
Derivative Financial Instrume_6
Derivative Financial Instruments - Additional Information (Details) - USD ($) | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 |
Derivative [Line Items] | |||
Amounts Subject to Enforceable Master Netting Arrangements | $ 1,000,000 | $ 1,000,000 | $ 8,000,000 |
Derivative assets, net of amount subject to master netting arrangement | 45,000,000 | 13,000,000 | 23,000,000 |
Derivative liabilities, net of amount subject to master netting arrangement | $ 0 | $ 42,000,000 | $ 12,000,000 |
Share Repurchase Activity (Deta
Share Repurchase Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | |||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | ||
Disclosure Share Repurchase Activity [Abstract] | |||||
Number of shares repurchased | [1] | 3.6 | 3.8 | 10 | 12.5 |
Total cost | $ 100 | $ 100 | $ 300 | $ 300 | |
Average per share cost including commissions (in dollars per share) | $ 28.09 | $ 26.64 | $ 30.01 | $ 24.21 | |
[1] | Excludes shares withheld to settle employee statutory tax withholding related to the vesting of stock units. |
Share Repurchases - Additional
Share Repurchases - Additional Information (Details) - USD ($) $ in Millions | Nov. 03, 2018 | Feb. 03, 2018 | Oct. 28, 2017 | Feb. 25, 2016 |
Disclosure Share Repurchases Additional Information [Abstract] | ||||
Stock Repurchase Program, Authorized Amount | $ 1,000 | |||
Share repurchases, remaining amount | $ 385 | |||
Stock Repurchase Program Amount Not Paid | $ 0 | $ 0 | $ 0 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||||||||
Nov. 03, 2018 | Aug. 04, 2018 | May 05, 2018 | Oct. 28, 2017 | Jul. 29, 2017 | Apr. 29, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | Feb. 03, 2018 | Jan. 28, 2017 | |
Foreign currency translation and other, net | $ (4) | $ (16) | $ (7) | $ (5) | $ 21 | $ (4) | $ (27) | $ 12 | ||
Change in fair value of derivative financial instruments | 11 | 18 | 28 | 23 | (43) | 0 | 57 | (20) | ||
Amounts reclassified from accumulated other comprehensive income | (7) | 0 | (6) | (1) | (1) | (4) | (13) | (6) | ||
Other comprehensive income (loss), net of tax | 0 | 2 | 15 | 17 | (23) | (8) | 17 | (14) | ||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 53 | 53 | 51 | 40 | 23 | 46 | 53 | 40 | $ 36 | $ 54 |
Accumulated Translation Adjustment [Member] | ||||||||||
Foreign currency translation and other, net | (4) | (16) | (7) | (5) | 21 | (4) | ||||
Change in fair value of derivative financial instruments | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Amounts reclassified from accumulated other comprehensive income | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Other comprehensive income (loss), net of tax | (4) | (16) | (7) | (5) | 21 | (4) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | 37 | 41 | 57 | 41 | 46 | 25 | 37 | 41 | 64 | 29 |
Derivatives in cash flow hedging relationships | ||||||||||
Foreign currency translation and other, net | 0 | 0 | 0 | 0 | 0 | 0 | ||||
Change in fair value of derivative financial instruments | 11 | 18 | 28 | 23 | (43) | 0 | ||||
Amounts reclassified from accumulated other comprehensive income | (7) | 0 | (6) | (1) | (1) | (4) | ||||
Other comprehensive income (loss), net of tax | 4 | 18 | 22 | 22 | (44) | (4) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax | $ 16 | $ 12 | $ (6) | $ (1) | $ (23) | $ 21 | $ 16 | $ (1) | $ (28) | $ 25 |
Share-Based Compensation Expens
Share-Based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 24 | $ 18 | $ 72 | $ 60 |
Less: Income tax benefit | (6) | (7) | (17) | (23) |
Share-based compensation expense, net of tax | 18 | 11 | 55 | 37 |
Stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 19 | 14 | 57 | 47 |
Stock options | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | 4 | 3 | 12 | 10 |
Employee stock purchase plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation expense | $ 1 | $ 1 | $ 3 | $ 3 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Nov. 03, 2018 | Aug. 04, 2018 | May 05, 2018 | Feb. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | Feb. 03, 2018 | |
Income Tax Disclosure [Abstract] | ||||||||
Effective Income Tax Rate Reconciliation, Percent | 24.00% | 37.10% | 24.00% | 38.20% | ||||
Decrease In Gross Unrecognized Tax Benefits Within The Next 12 Months | $ 4 | $ 4 | ||||||
Benefit To Income Taxes If Decrease In Gross Unrecognized Tax Benefits Within 12 Months Are Recognized | $ 0 | |||||||
U.S. federal statutory tax rate | 35.00% | |||||||
U.S. Federal Statutory Tax Rate after Tax Cuts and Jobs Act | 21.00% | |||||||
Other Tax Expense (Benefit) | $ 57 | |||||||
Measurement Period Adjustments to Provisional Estimated Net Change | $ 33 | $ 0 | $ 0 |
Earnings Per Share - Weighted A
Earnings Per Share - Weighted Average Number of Shares (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | |
Earnings Per Share [Abstract] | ||||
Weighted-average number of shares - basic (in shares) | 384 | 391 | 387 | 395 |
Common stock equivalents (in shares) | 3 | 2 | 3 | 2 |
Weighted-average number of shares - diluted (in shares) | 387 | 393 | 390 | 397 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | |
Earnings Per Share [Abstract] | ||||
Shares excluded from the computations of weighted-average number of shares - diluted | 7 | 9 | 6 | 9 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Nov. 03, 2018 | Oct. 28, 2017 | Feb. 03, 2018 | |
Commitments and Contingencies [Line Items] | |||
Loss Contingency, Estimate of Possible Loss | $ 0 | $ 0 | $ 0 |
Insurance proceeds related to loss on property and equipment | $ 0 | $ 60 |
Segment Information - Net Sales
Segment Information - Net Sales by Brand and Region (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Nov. 03, 2018 | Oct. 28, 2017 | Nov. 03, 2018 | Oct. 28, 2017 | ||
Segment Reporting Information [Line Items] | |||||
Credit Card Revenue | $ 170 | $ 449 | |||
Net Sales | [1] | $ 4,089 | $ 3,838 | $ 11,957 | $ 11,077 |
Percentage of Net Sales | [1] | 100.00% | 100.00% | 100.00% | 100.00% |
U.S. | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[2] | $ 3,274 | $ 3,004 | $ 9,614 | $ 8,775 |
Percentage of Net Sales | [1],[2] | 80.00% | 79.00% | 81.00% | 79.00% |
Canada | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | $ 316 | $ 310 | $ 874 | $ 822 |
Percentage of Net Sales | [1] | 8.00% | 8.00% | 7.00% | 8.00% |
Europe | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | $ 149 | $ 158 | $ 436 | $ 446 |
Percentage of Net Sales | [1] | 4.00% | 4.00% | 4.00% | 4.00% |
Asia | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | $ 300 | $ 312 | $ 883 | $ 883 |
Percentage of Net Sales | [1] | 7.00% | 8.00% | 7.00% | 8.00% |
Other Regions | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | $ 50 | $ 54 | $ 150 | $ 151 |
Percentage of Net Sales | [1] | 1.00% | 1.00% | 1.00% | 1.00% |
Gap | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | $ 1,283 | $ 1,322 | $ 3,712 | $ 3,712 |
Gap | U.S. | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[2] | 738 | 750 | 2,146 | 2,137 |
Gap | Canada | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 104 | 109 | 275 | 277 |
Gap | Europe | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 145 | 154 | 425 | 435 |
Gap | Asia | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 266 | 278 | 779 | 780 |
Gap | Other Regions | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 30 | 31 | 87 | 83 |
Old Navy | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 1,947 | 1,758 | 5,684 | 5,077 |
Old Navy | U.S. | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[2] | 1,769 | 1,587 | 5,175 | 4,609 |
Old Navy | Canada | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 152 | 143 | 430 | 387 |
Old Navy | Europe | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 0 | 0 | 0 | 0 |
Old Navy | Asia | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 13 | 13 | 36 | 34 |
Old Navy | Other Regions | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 13 | 15 | 43 | 47 |
Banana Republic | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 601 | 557 | 1,769 | 1,653 |
Banana Republic | U.S. | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[2] | 510 | 467 | 1,503 | 1,396 |
Banana Republic | Canada | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 59 | 57 | 167 | 156 |
Banana Republic | Europe | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 4 | 4 | 11 | 11 |
Banana Republic | Asia | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 21 | 21 | 68 | 69 |
Banana Republic | Other Regions | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 7 | 8 | 20 | 21 |
Other | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[3] | 258 | 201 | 792 | 635 |
Other | U.S. | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[2],[3] | 257 | 200 | 790 | 633 |
Other | Canada | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[3] | 1 | 1 | 2 | 2 |
Other | Europe | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[3] | 0 | 0 | 0 | 0 |
Other | Asia | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[3] | 0 | 0 | 0 | 0 |
Other | Other Regions | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1],[3] | $ 0 | $ 0 | $ 0 | $ 0 |
[1] | Net sales for the thirteen and thirty-nine weeks ended November 3, 2018 reflect the adoption of the new revenue recognition standard, which resulted in an increase to net sales of $170 million and $449 million, respectively, for revenue sharing and reimbursements of loyalty program discounts associated with the Company's credit card programs, as well as breakage revenue for our gift cards and credit vouchers. Prior period amounts have not been restated and continue to be reported under accounting standards in effect for those periods. | ||||
[2] | U.S. includes the United States, Puerto Rico, and Guam. | ||||
[3] | Primarily consists of net sales for the Athleta and Intermix brands. Beginning in the third quarter of fiscal 2018, the Hill City brand is also included. |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 9 Months Ended |
Nov. 03, 2018Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments (in segments) | 1 |