Cover Page
Cover Page - shares | 6 Months Ended | |
Aug. 01, 2020 | Aug. 24, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Aug. 1, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-7562 | |
Entity Registrant Name | GAP, INC | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 94-1697231 | |
Entity Address, Address Line One | Two Folsom Street | |
Entity Address, City or Town | San Francisco | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94105 | |
City Area Code | 415 | |
Local Phone Number | 427-0100 | |
Title of 12(b) Security | Common Stock, $0.05 par value | |
Trading Symbol | GPS | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 373,593,071 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0000039911 | |
Current Fiscal Year End Date | --01-30 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 |
Current assets: | |||
Cash and cash equivalents | $ 2,188 | $ 1,364 | $ 1,177 |
Available-for-sale Securities, Current | 25 | 290 | 294 |
Merchandise inventory | 2,242 | 2,156 | 2,326 |
Other current assets | 882 | 706 | 770 |
Total current assets | 5,337 | 4,516 | 4,567 |
Property and equipment, net of accumulated depreciation of $5,933, $5,839, and $5,926 | 2,895 | 3,122 | 3,141 |
Operating Lease, Right-of-Use Asset | 4,689 | 5,402 | 5,807 |
Other long-term assets | 795 | 639 | 528 |
Total assets | 13,716 | 13,679 | 14,043 |
Current liabilities: | |||
Accounts payable | 1,629 | 1,174 | 1,246 |
Accrued expenses and other current liabilities | 1,124 | 1,067 | 908 |
Operating Lease, Liability, Current | 856 | 920 | 946 |
Income taxes payable | 40 | 48 | 34 |
Total current liabilities | 3,649 | 3,209 | 3,134 |
Long-term liabilities: | |||
Total long-term debt | 2,212 | 1,249 | 1,249 |
Lease incentives and other long-term liabilities | 423 | 397 | 391 |
Operating Lease, Liability, Noncurrent | 5,179 | 5,508 | 5,644 |
Total long-term liabilities | 7,814 | 7,154 | 7,284 |
Commitments and contingencies (see Note 9) | |||
Stockholders' equity: | |||
Authorized 2,300 shares for all periods presented; Issued and Outstanding 374, 371, and 376 shares | 19 | 19 | 19 |
Additional Paid in Capital | 39 | 0 | 0 |
Retained earnings | 2,173 | 3,257 | 3,551 |
Amounts reclassified from accumulated other comprehensive income | 22 | 40 | 55 |
Total stockholders' equity | 2,253 | 3,316 | 3,625 |
Total liabilities and stockholders' equity | $ 13,716 | $ 13,679 | $ 14,043 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Millions, $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 |
Property and equipment, accumulated depreciation | $ 5,933 | $ 5,839 | $ 5,926 |
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) | 374 | 371 | 376 |
Common stock, shares outstanding (in shares) | 374 | 371 | 376 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Net Sales | $ 3,275 | $ 4,005 | $ 5,382 | $ 7,711 |
Cost of goods sold and occupancy expenses | 2,126 | 2,449 | 3,965 | 4,811 |
Gross profit | 1,149 | 1,556 | 1,417 | 2,900 |
Operating Expenses | 1,076 | 1,274 | 2,588 | 2,302 |
Operating income (loss) | 73 | 282 | (1,171) | 598 |
Gain (Loss) on Extinguishment of Debt | 58 | 0 | 58 | 0 |
Interest Expense | 58 | 19 | 77 | 39 |
Interest income | (2) | (8) | (6) | (14) |
Income (loss) before income taxes | (41) | 271 | (1,300) | 573 |
Income taxes | 21 | 103 | (306) | 178 |
Net income (loss) | $ (62) | $ 168 | $ (994) | $ 395 |
Weighted-average number of shares - basic (in shares) | 374 | 378 | 373 | 378 |
Weighted-average number of shares - diluted (in shares) | 374 | 379 | 373 | 380 |
Earnings (loss) per share - basic (in dollars per share) | $ (0.17) | $ 0.44 | $ (2.66) | $ 1.04 |
Earnings (loss) per share - diluted (in dollars per share) | $ (0.17) | $ 0.44 | $ (2.66) | $ 1.04 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Net income (loss) | $ (62) | $ 168 | $ (994) | $ 395 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation | (10) | 0 | (19) | (1) |
Change in fair value of derivative financial instruments, net of tax of $(1), $1, $1, and $5 | (8) | 1 | 11 | 10 |
Reclassification adjustment for gains on derivative financial instruments, net of tax of $(1), $(3), $(1), and $(5) | (6) | (3) | (10) | (7) |
Other comprehensive income (loss), net of tax | (24) | (2) | (18) | 2 |
Comprehensive income (loss) | $ (86) | $ 166 | $ (1,012) | $ 397 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Change in fair value of derivative financial instruments, net of tax (tax benefit) | $ (1) | $ 1 | $ 1 | $ 5 |
Reclassification adjustment for (gains) losses on derivative financial instruments, net of (tax) tax benefit | $ (1) | $ (3) | $ (1) | $ (5) |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS" EQUITY - USD ($) shares in Millions, $ in Millions | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | AOCI Attributable to Parent [Member] | Stock optionsCommon Stock [Member] | Stock Units [Member]Common Stock [Member] |
Common stock, shares issued (in shares) | 378 | ||||||
Stockholders' Equity Attributable to Parent | $ 3,553 | $ 19 | $ 0 | $ 3,481 | $ 53 | ||
Net income (loss) | 395 | 395 | |||||
Stock Repurchased and Retired During Period, Shares | (5) | ||||||
Reclassification from AOCI, Current Period, Net of Tax, Attributable to Parent | (7) | (7) | |||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | (1) | (1) | |||||
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax | 10 | 10 | |||||
Stock Repurchased and Retired During Period, Value | (100) | $ 0 | 44 | 56 | |||
Stock Issued During Period, Shares, Other | 1 | 2 | |||||
Stock Issued During Period, Value, Other | 17 | 0 | 17 | ||||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | (20) | $ 0 | (20) | ||||
APIC, Share-based Payment Arrangement, Increase for Cost Recognition | 47 | 47 | |||||
Dividends, Cash | (183) | (183) | |||||
Common stock, shares issued (in shares) | 378 | ||||||
Stockholders' Equity Attributable to Parent | 3,571 | $ 19 | 0 | 3,495 | 57 | ||
Lease 842 Initial Application Period Cumulative Effect | (86) | ||||||
Net income (loss) | 168 | 168 | |||||
Stock Repurchased and Retired During Period, Shares | (3) | ||||||
Reclassification from AOCI, Current Period, Net of Tax, Attributable to Parent | (3) | (3) | |||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | 0 | 0 | |||||
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax | 1 | 1 | |||||
Stock Repurchased and Retired During Period, Value | (50) | $ 0 | (29) | (21) | |||
Stock Issued During Period, Shares, Other | 0 | 1 | |||||
Stock Issued During Period, Value, Other | 7 | 0 | 7 | ||||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | (1) | $ 0 | (1) | ||||
APIC, Share-based Payment Arrangement, Increase for Cost Recognition | 23 | 23 | |||||
Dividends, Cash | $ (91) | (91) | |||||
Common stock, shares issued (in shares) | 376 | 376 | |||||
Stockholders' Equity Attributable to Parent | $ 3,625 | $ 19 | 0 | 3,551 | 55 | ||
Lease 842 Initial Application Period Cumulative Effect | $ (86) | ||||||
Common stock, shares issued (in shares) | 371 | 371 | |||||
Stockholders' Equity Attributable to Parent | $ 3,316 | $ 19 | 0 | 3,257 | 40 | ||
Net income (loss) | (994) | (994) | |||||
Reclassification from AOCI, Current Period, Net of Tax, Attributable to Parent | (10) | (10) | |||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | (19) | (19) | |||||
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax | 11 | 11 | |||||
Stock Issued During Period, Shares, Other | 1 | 2 | |||||
Stock Issued During Period, Value, Other | 12 | 0 | 12 | ||||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | (8) | $ 0 | (8) | ||||
APIC, Share-based Payment Arrangement, Increase for Cost Recognition | 35 | 35 | |||||
Dividends, Cash | (90) | (90) | |||||
Common stock, shares issued (in shares) | 373 | ||||||
Stockholders' Equity Attributable to Parent | 2,317 | $ 19 | 17 | 2,235 | 46 | ||
Net income (loss) | (62) | (62) | |||||
Reclassification from AOCI, Current Period, Net of Tax, Attributable to Parent | (6) | (6) | |||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | (10) | (10) | |||||
Other Comprehensive Income (Loss), Derivatives Qualifying as Hedges, Net of Tax | (8) | (8) | |||||
Stock Issued During Period, Shares, Other | 0 | 1 | |||||
Stock Issued During Period, Value, Other | 6 | 0 | 6 | ||||
Share-based Payment Arrangement, Decrease for Tax Withholding Obligation | (1) | $ 0 | (1) | ||||
APIC, Share-based Payment Arrangement, Increase for Cost Recognition | 17 | 17 | |||||
Dividends, Cash | $ 0 | 0 | |||||
Common stock, shares issued (in shares) | 374 | 374 | |||||
Stockholders' Equity Attributable to Parent | $ 2,253 | $ 19 | $ 39 | $ 2,173 | $ 22 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS" EQUITY (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||||
Common Stock, Dividends, Per Share, Declared | $ 0 | $ 0.2425 | $ 0.2425 | $ 0.4850 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | |
Aug. 01, 2020 | Aug. 03, 2019 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (994) | $ 395 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 256 | 277 |
Other Asset Impairment Charges | 127 | 3 |
Gain (Loss) on Extinguishment of Debt | 58 | 0 |
Amortization of Debt Issuance Costs | 4 | 1 |
Operating Lease, Impairment Loss | 361 | 0 |
Share-based compensation | 35 | 47 |
Non-cash and other items | 0 | 6 |
Gain (Loss) on Disposition of Property Plant Equipment | 0 | (191) |
Deferred income taxes | (125) | 46 |
Changes in operating assets and liabilities: | ||
Merchandise inventory | 91 | 166 |
Other current assets and other long-term assets | 134 | 29 |
Accounts payable | 467 | 147 |
Accrued expenses and other current liabilities | (40) | (14) |
Income taxes payable, net of receivables and other tax-related items | (232) | 43 |
Lease incentives and other long-term liabilities | 1 | 24 |
Operating lease assets and liabilities, net | (48) | (64) |
Net cash provided by (used for) operating activities | (87) | 583 |
Cash flows from investing activities: | ||
Proceeds from Sale of Buildings | 0 | 220 |
Purchases of property and equipment | (208) | (324) |
Payments to Acquire Short-term Investments | (59) | (150) |
Proceeds from Sale, Maturity and Collection of Short-term Investments | 325 | 146 |
Payments to Acquire Businesses, Net of Cash Acquired | 0 | (69) |
Payments to Acquire Buildings | 0 | (343) |
Other | 2 | 0 |
Net cash provided by (used for) investing activities | 60 | (520) |
Cash flows from financing activities: | ||
Proceeds from issuances under share-based compensation plans | 12 | 17 |
Withholding tax payments related to vesting of stock units | (8) | (20) |
Repurchases of common stock | 0 | (100) |
Cash dividends paid | 0 | (183) |
Proceeds from issuance of long-term debt | 2,250 | 0 |
Proceeds from Lines of Credit | 500 | |
Repayments of Long-term Debt | (1,307) | 0 |
Payments of Debt Issuance Costs | (61) | 0 |
Repayments of Lines of Credit | (500) | 0 |
Net cash provided by (used for) financing activities | 886 | (286) |
Effect of Exchange Rate on Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents | 1 | (2) |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | 860 | (225) |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents beginning of period | 1,381 | 1,420 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents end of period | 2,241 | 1,195 |
Supplemental disclosure of cash flow information: | ||
Interest Paid, Excluding Capitalized Interest, Operating Activities | 39 | 38 |
Cash paid for income taxes during the period, net of refunds | $ 53 | $ 90 |
Accounting Policies
Accounting Policies | 6 Months Ended |
Aug. 01, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Accounting Policies [Text Block] | Note 1 . Accounting Policies Basis of Presentation The Condensed Consolidated Balance Sheets as of August 1, 2020 and August 3, 2019 , and the Condensed Consolidated Statements of Operations, the Condensed Consolidated Statements of Comprehensive Income (Loss), and the Condensed Consolidated Statements of Stockholders' Equity for the thirteen and twenty-six weeks ended August 1, 2020 and August 3, 2019 , and the Condensed Consolidated Statements of Cash Flows for the twenty-six weeks ended August 1, 2020 and August 3, 2019 , have been prepared by The Gap, Inc. (the “Company,” “we,” and “our”). In the opinion of management, such statements contain all normal and recurring adjustments (except as otherwise disclosed) considered necessary to present fairly our financial position, results of operations, comprehensive income (loss), stockholders' equity, and cash flows as of August 1, 2020 and August 3, 2019 and for all periods presented. The Condensed Consolidated Balance Sheet as of February 1, 2020 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 1, 2020 . The results of operations for the thirteen and twenty-six weeks ended August 1, 2020 are not necessarily indicative of the operating results that may be expected for the 52-week period ending January 30, 2021 . COVID-19 In March 2020, the World Health Organization declared the coronavirus disease ("COVID-19") a global pandemic and recommended containment and mitigation measures worldwide. As a result, we temporarily closed our North America retail stores and a significant number of our stores globally. In May 2020, we began to safely reopen our temporarily closed stores in accordance with local government guidelines. The Company also implemented several actions during the thirteen weeks ended August 1, 2020 , to enhance our liquidity position such as completing the issuance of our Senior Secured Notes for $2.25 billion and entering into a third amended and restated senior secured asset-based revolving credit agreement (the "ABL Facility"), with an initial aggregate principal amount of up to $1.8675 billion . There were no borrowings under the ABL Facility as of August 1, 2020 . See Note 3 of Notes to Condensed Consolidated Financial Statements for further details. During the twenty-six weeks ended August 1, 2020 , we also suspended share repurchases and dividends, and deferred the first quarter of fiscal 2020 dividend. We suspended rent payments under the leases for our temporarily closed stores beginning in April 2020 and are now working through negotiations with our landlords relating to those leases. We considered the Financial Accounting Standards Board's ("FASB") recent guidance regarding lease modifications as a result of the effects of COVID-19 and elected to apply the temporary practical expedient to account for lease changes as variable rent unless an amendment results in a substantial change in the Company's lease obligations. As of August 1, 2020 , the impact of applying the temporary practical expedient was not material to our Condensed Consolidated Financial Statements. In response to COVID-19, various governments worldwide have enacted, or are in the process of enacting, measures to provide relief to businesses negatively affected by the pandemic. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act ("CARES Act") was signed into law in the United States. The CARES Act provides relief to U.S. corporations through financial assistance programs and modifications to certain payroll and income tax provisions. The Company is also considering certain beneficial provisions of the CARES Act, including the net operating loss carryback provision. See Note 7 of Notes to Condensed Consolidated Financial Statements for more information on the estimated income tax impact of the CARES Act. We continue to consider the impact of COVID-19 on the assumptions and estimates used when preparing these quarterly financial statements including inventory valuation, lease accounting impacts, income taxes, and the impairment of long-lived store assets and operating lease assets. These assumptions and estimates may change as the current situation evolves or new events occur and additional information is obtained. If the economic conditions caused by COVID-19 worsen beyond what is currently estimated by management, such future changes may have an adverse impact on the Company's results of operations, financial position, and liquidity. Restricted Cash 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. As of August 1, 2020 , restricted cash primarily included consideration that serves as collateral for certain obligations and fees occurring in the normal course of business and our insurance obligations. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within our Condensed Consolidated Balance Sheets to the total shown on our Condensed Consolidated Statements of Cash Flows: ($ in millions) August 1, February 1, August 3, Cash and cash equivalents, per Condensed Consolidated Balance Sheets $ 2,188 $ 1,364 $ 1,177 Restricted cash included in other current assets 33 — — Restricted cash included in other long-term assets 20 17 18 Total cash, cash equivalents, and restricted cash, per Condensed Consolidated Statements of Cash Flows $ 2,241 $ 1,381 $ 1,195 Accounting Pronouncements Recently Adopted ASU No. 2018-15, Customer's Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract In August 2018, the FASB issued accounting standards update ("ASU") No. 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. The ASU is intended to align the requirements for capitalization of implementation costs incurred in a cloud computing arrangement that is a service contract with the existing guidance for internal-use software. We adopted this ASU on a prospective basis on February 2, 2020. The adoption of this standard did not have a material impact on our Condensed Consolidated Financial Statements or related disclosures. Accounting Pronouncements Not Yet Adopted Except as noted below, the Company has considered all recent accounting pronouncements and concluded that there are no recent accounting pronouncements that may have a material impact on our Condensed Consolidated Financial Statements, based on current information. ASU No. 2019-12, Simplifying the Accounting for Income Taxes In December 2019, the FASB issued ASU No. 2019-12, Simplifying the Accounting for Income Taxes. The ASU is intended to enhance and simplify aspects of the income tax accounting guidance in ASC 740 as part of the FASB's simplification initiative. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2020 with early adoption permitted. The Company is currently evaluating the impact this guidance may have on our Condensed Consolidated Financial Statements. |
Revenue
Revenue | 6 Months Ended |
Aug. 01, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | Revenue The Company’s revenues include merchandise sales at stores, online, and through franchise agreements, as well as the newly introduced business-to-business ("B2B") program. 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. Breakage revenue is recognized based upon historical redemption patterns. For online sales, the Company has elected to treat shipping and handling as fulfillment activities and not as a separate performance obligation. Accordingly, we recognize revenue for our single performance obligation related to online 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. 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 include 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. Income related to our credit card agreement is classified within net sales on our Condensed Consolidated Statements of Operations. 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 of the merchandise transfers. As of the quarter ended August 1, 2020 and August 3, 2019 , 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 August 1, 2020 , the opening balance of deferred revenue for these obligations was $198 million , of which $63 million was recognized as revenue during the period. For the twenty-six weeks ended August 1, 2020 , the opening balance of deferred revenue for these obligations was $226 million , of which $118 million was recognized as revenue during the period. The closing balance of deferred revenue for these obligations was $189 million as of August 1, 2020. We expect that the majority of our revenue deferrals as of the quarter ended August 1, 2020 , will be recognized as revenue in the next twelve months as our performance obligations are satisfied. For the thirteen weeks ended August 3, 2019, the opening balance of deferred revenue for these obligations was $206 million , of which $71 million was recognized as revenue during the period. For the twenty-six weeks ended August 3, 2019, the opening balance of deferred revenue for these obligations was $227 million , of which $134 million was recognized as revenue during the period. The closing balance of deferred revenue for these obligations was $195 million as of August 3, 2019. Net sales disaggregated for stores and online sales for the thirteen and twenty-six weeks ended August 1, 2020 and August 3, 2019 was as follows: 13 Weeks Ended 26 Weeks Ended ($ in millions) August 1, 2020 August 3, 2019 August 1, 2020 August 3, 2019 Store sales (1) $ 1,642 $ 3,166 $ 2,750 $ 5,989 Online sales (2) 1,633 839 2,632 1,722 Total net sales $ 3,275 $ 4,005 $ 5,382 $ 7,711 __________ (1) Store sales primarily include sales made at our Company-operated stores and franchise sales. Fiscal 2020 store sales were negatively impacted by COVID-19. See Note 1 of Notes to Condensed Consolidated Financial Statements for further details. (2) Online sales primarily include sales made through our online channels including curbside pick-up, ship-from-store sales, buy online pick-up in store sales, and order-in-store sales. Additionally, beginning in the second quarter of fiscal 2020, sales from the B2B program are also included. See Note 10 of Notes to Condensed Consolidated Financial Statements for further disaggregation of revenue by brand and by region. |
Debt and Credit Facilities
Debt and Credit Facilities | 6 Months Ended |
Aug. 01, 2020 | |
Debt Disclosure [Abstract] | |
Debt and Credit Facilities | Debt and Credit Facilities Long-term debt recorded on the Condensed Consolidated Balance Sheets consists of the following: ($ in millions) August 1, February 1, August 3, 2021 Notes $ — $ 1,249 $ 1,249 2023 Notes 500 — — 2025 Notes 750 — — 2027 Notes 1,000 — — Less: Unamortized debt issuance costs (38 ) — — Total long-term debt $ 2,212 $ 1,249 $ 1,249 On June 6, 2020, we redeemed our $1.25 billion aggregate principal amount of 5.95 percent notes due April 2021 (the "2021 Notes"). We incurred a loss on extinguishment of debt of $58 million , which primarily includes the make-whole premium, which was recorded on the Condensed Consolidated Statement of Operations. Prior to redeeming our 2021 Notes, the aggregate principal amount of the 2021 Notes was recorded in long-term debt on the Condensed Consolidated Balance Sheets, net of the unamortized discount. Following the redemption, our obligations under the 2021 Notes were discharged. On May 7, 2020, we completed the issuance of our Senior Secured Notes due 2023 (“2023 Notes”), 2025 (“2025 Notes”), and 2027 (“2027 Notes”) (collectively, the “Notes”) in a private placement to qualified buyers and received gross proceeds of $2.25 billion . Concurrently with the issuance of the Notes, the Company amended the existing unsecured revolving credit facility with the ABL Facility which is scheduled to expire in May 2023 . We recorded approximately $61 million of debt issuance costs related to the Notes and ABL Facility within long-term debt and other long-term assets on the Condensed Consolidated Balance Sheet, which will be amortized through interest expense over the life of the related instrument. The scheduled maturity of the Notes is as follows: Scheduled Maturity ($ in millions) Principal Interest Rate Interest Payments Senior Secured Notes (1) May 15, 2023 $ 500 8.375 % Semi-Annual May 15, 2025 750 8.625 % Semi-Annual May 15, 2027 1,000 8.875 % Semi-Annual Total issuance $ 2,250 __________ (1) Includes an option to call the Notes in whole or in part at any time, subject to a make-whole premium. As of August 1, 2020 , the estimated fair value of the Notes was $2.50 billion and was based on the quoted market price for each 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 Sheet, net of the unamortized debt issuance cost. The ABL Facility has a $1.8675 billion borrowing capacity and bears interest at a base rate (typically LIBOR) plus a margin depending on borrowing base availability. We also have the ability to issue letters of credit on our ABL Facility. As of August 1, 2020, we had $48 million in standby letters of credit issued under the ABL Facility. There were no borrowings under the ABL Facility as of August 1, 2020 . The Notes are secured by the Company's real and intellectual property and equipment and intangibles. The Notes contain covenants that limit the Company’s ability to, among other things: (i) grant or incur liens on the collateral; (ii) incur, assume or guarantee additional indebtedness; (iii) enter into sale and lease-back transactions; (iv) sell or otherwise dispose of assets that are collateral; and (v) make certain restricted payments or other investments. The Notes are also subject to certain provisions related to default that, if triggered, could result in acceleration of the maturity of the Notes. The ABL Facility agreement is secured by specified assets, including a first lien on inventory, accounts receivable and bank accounts. The Notes are also secured by a second priority lien on certain assets securing the ABL Facility, which includes security interests in inventory, accounts receivable and bank accounts, subject to certain exceptions and permitted liens. In addition, the ABL Facility agreement is secured by a second lien on certain assets securing the Notes. The ABL Facility contains customary covenants restricting the Company's activities, as well as those of its subsidiaries, including limitations on the ability to sell assets, engage in mergers, or other fundamental changes, enter into capital leases or certain leases not in the ordinary course of business, enter into transactions involving related parties or derivatives, incur or prepay indebtedness, grant liens or negative pledges on its assets, make loans or other investments, pay dividends or repurchase stock or other securities, guarantee third-party obligations, engage in sale and lease-back transactions and make changes in its corporate structure. There are exceptions to these covenants, and some are only applicable when unused availability falls below specified thresholds. In addition, the ABL Facility includes, as a financial covenant, a springing fixed charge coverage ratio which arises when availability falls below a specified threshold. As of August 1, 2020 , we were in compliance with the applicable financial covenants and expect to maintain compliance for the next twelve months. We also maintain multiple agreements with third parties that make unsecured revolving credit facilities available for our operations in foreign locations (the “Foreign Facilities”). The Foreign Facilities are uncommitted and had a total capacity of $56 million as of August 1, 2020 . As of August 1, 2020 , there were no borrowings under the Foreign Facilities. There were $15 million in bank guarantees issued and outstanding primarily related to store leases under the Foreign Facilities as of August 1, 2020 . We have bilateral unsecured standby letter of credit agreements that are uncommitted and do not have expiration dates. There were no material standby letters of credit issued under these agreements as of August 1, 2020. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Aug. 01, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The Company measures certain financial assets and liabilities at fair value on a recurring basis, including derivatives and available-for-sale debt securities. The Company categorizes financial assets and liabilities recorded at fair value based upon a three-level hierarchy that considers the related valuation techniques. There were no purchases, sales, issuances, or settlements related to recurring level 3 measurements during the thirteen and twenty-six weeks ended August 1, 2020 or August 3, 2019 . There were no transfers of financial assets or liabilities into or out of level 1, level 2, and level 3 during the thirteen and twenty-six weeks ended August 1, 2020 and August 3, 2019 . Financial Assets and Liabilities Financial assets and liabilities measured at fair value on a recurring basis and cash equivalents are as follows: Fair Value Measurements at Reporting Date Using ($ in millions) August 1, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 368 $ — $ 368 $ — Short-term investments 25 — 25 — Derivative financial instruments 6 — 6 — Deferred compensation plan assets 46 46 — — Other assets 2 — — 2 Total $ 447 $ 46 $ 399 $ 2 Liabilities: Derivative financial instruments $ 19 $ — $ 19 $ — Fair Value Measurements at Reporting Date Using ($ in millions) February 1, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 311 $ 19 $ 292 $ — Short-term investments 290 117 173 — Derivative financial instruments 10 — 10 — Deferred compensation plan assets 51 51 — — Other assets 2 — — 2 Total $ 664 $ 187 $ 475 $ 2 Liabilities: Derivative financial instruments $ 10 $ — $ 10 $ — Fair Value Measurements at Reporting Date Using ($ in millions) August 3, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 312 $ 31 $ 281 $ — Short-term investments 294 131 163 — Derivative financial instruments 27 — 27 — Deferred compensation plan assets 51 51 — — Other assets 2 — — 2 Total $ 686 $ 213 $ 471 $ 2 Liabilities: Derivative financial instruments $ 9 $ — $ 9 $ — 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 August 1, 2020 and August 3, 2019 , the Company held $25 million and $294 million , respectively, of available-for-sale debt 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 August 1, 2020 , the Company held no material 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 Sheet. As of August 3, 2019 , the Company held $15 million 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 Sheet. Unrealized gains and losses on available-for-sale debt securities included within accumulated other comprehensive income were immaterial as of August 1, 2020 and August 3, 2019 . The Company regularly reviews its available-for-sale debt securities for other-than-temporary impairment. For the thirteen and twenty-six weeks ended August 1, 2020 and August 3, 2019 , 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 fair value of the Company’s derivative financial instruments is determined using pricing models based on current market rates. See Note 5 of Notes to Condensed Consolidated Financial Statements for information regarding currencies hedged against the U.S. dollar. We maintain the Gap, Inc. Deferred Compensation Plan (“DCP”), which allows eligible employees to defer base compensation and bonus up to a maximum percentage, and non-employee directors to defer receipt of a portion of their Board fees. 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 at the store level. The impact of COVID-19 resulted in a qualitative indication of impairment related to our store long-lived assets. For store locations, we analyzed our store asset recoverability. There were no material impairment charges recorded for long-lived assets during the thirteen weeks ended August 1, 2020 . During the twenty-six weeks ended August 1, 2020 , the Company recorded impairment of store assets of $127 million and impairment of operating lease assets of $361 million . The impairment of the store assets reduced the carrying amount of the applicable long-lived assets of $131 million to their fair value of $4 million . The impairment of the operating lease assets reduced the carrying amount of the applicable long-lived assets of $1,369 million to their fair value of $1,008 million . The impairment charges were recorded in operating expenses on the Condensed Consolidated Statement of Operations. During the thirteen and twenty-six weeks ended August 3, 2019 , there were no material impairment charges recorded for long-lived assets. 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 impairment charges recorded for goodwill or other indefinite-lived intangible assets for the thirteen and twenty-six weeks ended August 1, 2020 or August 3, 2019 . |
Derivative Financial Instrument
Derivative Financial Instruments | 6 Months Ended |
Aug. 01, 2020 | |
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 dollar, Japanese yen, British pound, Mexican peso, Euro, and Taiwan dollar. Cash flows from derivative financial instruments are classified as cash flows from operating activities on 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 into net income (loss) during the period in which the underlying transaction impacts the Condensed Consolidated Statements of Operations. 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 on the Condensed Consolidated Statements of Operations 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) August 1, February 1, August 3, Derivatives designated as cash flow hedges $ 214 $ 501 $ 652 Derivatives not designated as hedging instruments 727 689 1,046 Total $ 941 $ 1,190 $ 1,698 Quantitative Disclosures about Derivative Financial Instruments The fair values of foreign exchange forward contracts are as follows: ($ in millions) August 1, February 1, August 3, Derivatives designated as cash flow hedges: Other current assets $ 3 $ 6 $ 15 Other long-term assets — — 1 Accrued expenses and other current liabilities 1 2 1 Lease incentives and other long-term liabilities — — 1 Derivatives not designated as hedging instruments: Other current assets 3 4 11 Accrued expenses and other current liabilities 18 8 7 Total derivatives in an asset position $ 6 $ 10 $ 27 Total derivatives in a liability position $ 19 $ 10 $ 9 All of the unrealized gains and losses from designated cash flow hedges as of August 1, 2020 will be recognized into net income (loss) within the next twelve months at the then-current values, which may differ from the fair values as of August 1, 2020 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 were not material as of August 1, 2020 , February 1, 2020 , and August 3, 2019 , 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 designated in a cash flow hedging relationship recorded in other comprehensive income, on a pre-tax basis, are as follows: 13 Weeks Ended 26 Weeks Ended ($ in millions) August 1, August 3, August 1, August 3, Gain (loss) recognized in other comprehensive income $ (9 ) $ 2 $ 12 $ 15 The pre-tax amounts recognized in net income (loss) related to derivative instruments are as follows: Location and Amount of (Gain) Loss Recognized in Net Income (Loss) 13 Weeks Ended 13 Weeks Ended ($ in millions) Cost of goods sold and occupancy expense Operating expenses Cost of goods sold and occupancy expense Operating expenses Total amount of expense line items presented in the Condensed Consolidated Statements of Operations in which the effects of derivatives are recorded $ 2,126 $ 1,076 $ 2,449 $ 1,274 (Gain) loss recognized in net income (loss) Derivatives designated as cash flow hedges (7 ) — (6 ) — Derivatives not designated as hedging instruments — 32 — (3 ) Total (gain) loss recognized in net income (loss) $ (7 ) $ 32 $ (6 ) $ (3 ) Location and Amount of Gain Recognized in Net Income (Loss) 26 Weeks Ended 26 Weeks Ended ($ in millions) Cost of goods sold and occupancy expense Operating expenses Cost of goods sold and occupancy expense Operating expenses Total amount of expense line items presented in the Condensed Consolidated Statements of Operations in which the effects of derivatives are recorded $ 3,965 $ 2,588 $ 4,811 $ 2,302 Gain recognized in net income (loss) Derivatives designated as cash flow hedges (11 ) — (12 ) — Derivatives not designated as hedging instruments — (11 ) — (12 ) Total gain recognized in net income (loss) $ (11 ) $ (11 ) $ (12 ) $ (12 ) |
Share Repurchases
Share Repurchases | 6 Months Ended |
Aug. 01, 2020 | |
Disclosure Share Repurchase Activity [Abstract] | |
Share Repurchases | Share Repurchases Share repurchase activity is as follows: 13 Weeks Ended 26 Weeks Ended ($ and shares in millions except average per share cost) August 1, August 3, August 1, August 3, Number of shares repurchased (1) — 2.7 — 4.6 Total cost $ — $ 50 $ — $ 100 Average per share cost including commissions $ — $ 18.41 $ — $ 21.54 __________ (1) Excludes shares withheld to settle employee statutory tax withholding related to the vesting of stock units. In February 2019, the Board of Directors approved a new $1.0 billion share repurchase authorization (the "February 2019 repurchase program"). The February 2019 repurchase program had $800 million remaining as of August 1, 2020 . On March 12, 2020, the Company announced its decision to suspend share repurchases through fiscal 2020. All of the share repurchases were paid for as of February 1, 2020 and August 3, 2019 . All common stock repurchased is immediately retired. |
Income Taxes
Income Taxes | 6 Months Ended |
Aug. 01, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On March 27, 2020, the CARES Act was signed into law in the United States. The CARES Act includes certain provisions that affect our income taxes, including temporary five-year net operating loss carryback provisions, modifications to the interest deduction limitations, and the technical correction for depreciation of qualified leasehold improvements. The effective income tax rate was negative 51.2 percent for the thirteen weeks ended August 1, 2020 , compared with 38.0 percent for the thirteen weeks ended August 3, 2019 . The effective income tax rate was 23.5 percent for the twenty-six weeks ended August 1, 2020 , compared with 31.1 percent for the twenty-six weeks ended August 3, 2019 . The decrease in the effective tax rates as compared with the respective periods of fiscal 2019 is primarily due to net operating loss carryback provisions of the CARES Act, changes in the mix of pretax income between domestic and international operations and the fiscal 2019 impact of an adjustment for additional guidance issued regarding the Tax Cuts and Jobs Act of 2017 ("TCJA"). 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 August 1, 2020 , it is reasonably possible that we will recognize a decrease in gross unrecognized tax benefits within the next twelve months of up to $12 million , primarily due to the closing of audits. If we do recognize such a decrease, the net impact on the Condensed Consolidated Statements of Operations would not be material. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 6 Months Ended |
Aug. 01, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings (Loss) Per Share Weighted-average number of shares used for earnings (loss) per share is as follows: 13 Weeks Ended 26 Weeks Ended (shares in millions) August 1, August 3, August 1, August 3, Weighted-average number of shares - basic 374 378 373 378 Common stock equivalents (1) — 1 — 2 Weighted-average number of shares - diluted 374 379 373 380 __________ (1) For the thirteen and twenty-six weeks ended August 1, 2020 , the dilutive impact of outstanding options and awards was excluded from dilutive shares as a result of the Company’s net loss for the respective periods. The anti-dilutive shares related to stock options and other stock awards excluded from the computation of weighted-average number of shares – diluted were 16 million and 17 million for the thirteen weeks ended August 1, 2020 and August 3, 2019 , respectively, and 15 million and 13 million for the twenty-six weeks ended August 1, 2020 and August 3, 2019 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Aug. 01, 2020 | |
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 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 August 1, 2020 , 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 August 1, 2020 , February 1, 2020 , and August 3, 2019 , 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 August 1, 2020 , February 1, 2020 , and August 3, 2019 , was not material for any individual Action or in total. Subsequent to August 1, 2020 , 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. 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. |
Segment Information
Segment Information | 6 Months Ended |
Aug. 01, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information We identify our operating segments according to how our business activities are managed and evaluated. As of August 1, 2020 , our operating segments included: Old Navy Global, Gap Global, Banana Republic Global, Athleta, and Intermix. Each operating segment has a brand president who is responsible for various geographies and channels. Each of our brands serves customers through its store and online channels, allowing us to execute on our omni-channel strategy where customers can shop seamlessly across all of our brands in retail stores and online through desktop or mobile devices. 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 August 1, 2020 . We continually monitor and review our segment reporting structure in accordance with authoritative guidance to determine whether any changes have occurred that would impact our reportable segments. Net sales by brand and region are as follows: ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total 13 Weeks Ended August 1, 2020 U.S. (1) $ 1,726 $ 473 $ 236 $ 328 $ 2,763 Canada 145 63 27 — 235 Europe — 70 2 — 72 Asia 2 158 14 — 174 Other regions 8 19 4 — 31 Total $ 1,881 $ 783 $ 283 $ 328 $ 3,275 ($ in millions) Old Navy Global Gap Global Banana Republic Global (2) Other (4) Total 13 Weeks Ended August 3, 2019 U.S. (1) $ 1,794 $ 645 $ 530 $ 331 $ 3,300 Canada 148 85 53 — 286 Europe — 131 4 — 135 Asia 11 201 23 — 235 Other regions 19 24 6 — 49 Total $ 1,972 $ 1,086 $ 616 $ 331 $ 4,005 ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total 26 Weeks Ended August 1, 2020 U.S. (1) $ 2,675 $ 784 $ 481 $ 584 $ 4,524 Canada 222 97 51 — 370 Europe — 124 5 — 129 Asia 3 266 26 — 295 Other regions 19 36 9 — 64 Total $ 2,919 $ 1,307 $ 572 $ 584 $ 5,382 ($ in millions) Old Navy Global Gap Global Banana Republic Global (2) Other (4) Total 26 Weeks Ended August 3, 2019 U.S. (1) $ 3,435 $ 1,253 $ 1,017 $ 617 $ 6,322 Canada 276 154 100 1 531 Europe — 252 7 — 259 Asia 21 434 49 — 504 Other regions 39 45 11 — 95 Total $ 3,771 $ 2,138 $ 1,184 $ 618 $ 7,711 __________ (1) U.S. includes the United States, Puerto Rico, and Guam. (2) Banana Republic Global fiscal year 2019 net sales include the Janie and Jack brand beginning March 4, 2019. (3) Primarily consists of net sales for the Athleta, Intermix, and Hill City brands. Beginning in fiscal year 2020, Janie and Jack net sales are also included. Net sales for Athleta for the thirteen and twenty-six weeks ended August 1, 2020 were $267 million and $472 million , respectively. (4) Primarily consists of net sales for the Athleta, Intermix, and Hill City brands as well as a portion of income related to our credit card agreement. Net sales for Athleta for the thirteen and twenty-six weeks ended August 3, 2019 were $252 million and $475 million , respectively. Net sales by region are allocated based on the location of the store where the customer paid for and received the merchandise or the distribution center or store from which the products were shipped. |
Store Closing and Other Operati
Store Closing and Other Operating Cost | 6 Months Ended |
Aug. 01, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Disclosure [Text Block] | Store Closing and Other Operating Cost In fiscal 2019, the Company announced plans to restructure the specialty fleet and revitalize the Gap brand during fiscal 2019 and fiscal 2020. The Company believes these actions will drive a healthier specialty fleet and will serve a more appropriate foundation for brand revitalization. In response to COVID-19, the Company shifted its focus towards adapting to the COVID-19 challenges and as a result the restructuring costs were not material in the first half of fiscal 2020. |
Accounting Policies (Tables)
Accounting Policies (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures [Table Text Block] | As of August 1, 2020 , restricted cash primarily included consideration that serves as collateral for certain obligations and fees occurring in the normal course of business and our insurance obligations. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within our Condensed Consolidated Balance Sheets to the total shown on our Condensed Consolidated Statements of Cash Flows: ($ in millions) August 1, February 1, August 3, Cash and cash equivalents, per Condensed Consolidated Balance Sheets $ 2,188 $ 1,364 $ 1,177 Restricted cash included in other current assets 33 — — Restricted cash included in other long-term assets 20 17 18 Total cash, cash equivalents, and restricted cash, per Condensed Consolidated Statements of Cash Flows $ 2,241 $ 1,381 $ 1,195 |
Revenue Revenue Disaggregation
Revenue Revenue Disaggregation (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue [Table Text Block] | Net sales disaggregated for stores and online sales for the thirteen and twenty-six weeks ended August 1, 2020 and August 3, 2019 was as follows: 13 Weeks Ended 26 Weeks Ended ($ in millions) August 1, 2020 August 3, 2019 August 1, 2020 August 3, 2019 Store sales (1) $ 1,642 $ 3,166 $ 2,750 $ 5,989 Online sales (2) 1,633 839 2,632 1,722 Total net sales $ 3,275 $ 4,005 $ 5,382 $ 7,711 __________ (1) Store sales primarily include sales made at our Company-operated stores and franchise sales. Fiscal 2020 store sales were negatively impacted by COVID-19. See Note 1 of Notes to Condensed Consolidated Financial Statements for further details. (2) |
Debt and Credit Facilities Long
Debt and Credit Facilities Long Term Debt (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
Debt Disclosure [Abstract] | |
Long Term Debt | Long-term debt recorded on the Condensed Consolidated Balance Sheets consists of the following: ($ in millions) August 1, February 1, August 3, 2021 Notes $ — $ 1,249 $ 1,249 2023 Notes 500 — — 2025 Notes 750 — — 2027 Notes 1,000 — — Less: Unamortized debt issuance costs (38 ) — — Total long-term debt $ 2,212 $ 1,249 $ 1,249 |
Debt and Credit Facilities Sche
Debt and Credit Facilities Scheduled Maturity of Notes (Tables) | 6 Months Ended |
Aug. 03, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities of Long-term Debt [Table Text Block] | The scheduled maturity of the Notes is as follows: Scheduled Maturity ($ in millions) Principal Interest Rate Interest Payments Senior Secured Notes (1) May 15, 2023 $ 500 8.375 % Semi-Annual May 15, 2025 750 8.625 % Semi-Annual May 15, 2027 1,000 8.875 % Semi-Annual Total issuance $ 2,250 __________ (1) Includes an option to call the Notes in whole or in part at any time, subject to a make-whole premium. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
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) August 1, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 368 $ — $ 368 $ — Short-term investments 25 — 25 — Derivative financial instruments 6 — 6 — Deferred compensation plan assets 46 46 — — Other assets 2 — — 2 Total $ 447 $ 46 $ 399 $ 2 Liabilities: Derivative financial instruments $ 19 $ — $ 19 $ — Fair Value Measurements at Reporting Date Using ($ in millions) February 1, 2020 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 311 $ 19 $ 292 $ — Short-term investments 290 117 173 — Derivative financial instruments 10 — 10 — Deferred compensation plan assets 51 51 — — Other assets 2 — — 2 Total $ 664 $ 187 $ 475 $ 2 Liabilities: Derivative financial instruments $ 10 $ — $ 10 $ — Fair Value Measurements at Reporting Date Using ($ in millions) August 3, 2019 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 312 $ 31 $ 281 $ — Short-term investments 294 131 163 — Derivative financial instruments 27 — 27 — Deferred compensation plan assets 51 51 — — Other assets 2 — — 2 Total $ 686 $ 213 $ 471 $ 2 Liabilities: Derivative financial instruments $ 9 $ — $ 9 $ — |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
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) August 1, February 1, August 3, Derivatives designated as cash flow hedges $ 214 $ 501 $ 652 Derivatives not designated as hedging instruments 727 689 1,046 Total $ 941 $ 1,190 $ 1,698 |
Fair Values of Asset and Liability Derivative Financial Instruments | The fair values of foreign exchange forward contracts are as follows: ($ in millions) August 1, February 1, August 3, Derivatives designated as cash flow hedges: Other current assets $ 3 $ 6 $ 15 Other long-term assets — — 1 Accrued expenses and other current liabilities 1 2 1 Lease incentives and other long-term liabilities — — 1 Derivatives not designated as hedging instruments: Other current assets 3 4 11 Accrued expenses and other current liabilities 18 8 7 Total derivatives in an asset position $ 6 $ 10 $ 27 Total derivatives in a liability position $ 19 $ 10 $ 9 |
Effects of Derivative Financial Instruments on OCI and Condensed Consolidated Statements of Income | The pre-tax amounts recognized in net income (loss) related to derivative instruments are as follows: Location and Amount of (Gain) Loss Recognized in Net Income (Loss) 13 Weeks Ended 13 Weeks Ended ($ in millions) Cost of goods sold and occupancy expense Operating expenses Cost of goods sold and occupancy expense Operating expenses Total amount of expense line items presented in the Condensed Consolidated Statements of Operations in which the effects of derivatives are recorded $ 2,126 $ 1,076 $ 2,449 $ 1,274 (Gain) loss recognized in net income (loss) Derivatives designated as cash flow hedges (7 ) — (6 ) — Derivatives not designated as hedging instruments — 32 — (3 ) Total (gain) loss recognized in net income (loss) $ (7 ) $ 32 $ (6 ) $ (3 ) The effective portion of gains and losses on foreign exchange forward contracts designated in a cash flow hedging relationship recorded in other comprehensive income, on a pre-tax basis, are as follows: 13 Weeks Ended 26 Weeks Ended ($ in millions) August 1, August 3, August 1, August 3, Gain (loss) recognized in other comprehensive income $ (9 ) $ 2 $ 12 $ 15 |
Share Repurchases (Tables)
Share Repurchases (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
Disclosure Share Repurchase Activity [Abstract] | |
Share Repurchase Activity | Share repurchase activity is as follows: 13 Weeks Ended 26 Weeks Ended ($ and shares in millions except average per share cost) August 1, August 3, August 1, August 3, Number of shares repurchased (1) — 2.7 — 4.6 Total cost $ — $ 50 $ — $ 100 Average per share cost including commissions $ — $ 18.41 $ — $ 21.54 __________ (1) Excludes shares withheld to settle employee statutory tax withholding related to the vesting of stock units. |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
Earnings Per Share [Abstract] | |
Weighted-Average Number of Shares | Weighted-average number of shares used for earnings (loss) per share is as follows: 13 Weeks Ended 26 Weeks Ended (shares in millions) August 1, August 3, August 1, August 3, Weighted-average number of shares - basic 374 378 373 378 Common stock equivalents (1) — 1 — 2 Weighted-average number of shares - diluted 374 379 373 380 __________ (1) For the thirteen and twenty-six weeks ended August 1, 2020 , the dilutive impact of outstanding options and awards was excluded from dilutive shares as a result of the Company’s net loss for the respective periods. |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Aug. 01, 2020 | |
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 13 Weeks Ended August 1, 2020 U.S. (1) $ 1,726 $ 473 $ 236 $ 328 $ 2,763 Canada 145 63 27 — 235 Europe — 70 2 — 72 Asia 2 158 14 — 174 Other regions 8 19 4 — 31 Total $ 1,881 $ 783 $ 283 $ 328 $ 3,275 ($ in millions) Old Navy Global Gap Global Banana Republic Global (2) Other (4) Total 13 Weeks Ended August 3, 2019 U.S. (1) $ 1,794 $ 645 $ 530 $ 331 $ 3,300 Canada 148 85 53 — 286 Europe — 131 4 — 135 Asia 11 201 23 — 235 Other regions 19 24 6 — 49 Total $ 1,972 $ 1,086 $ 616 $ 331 $ 4,005 ($ in millions) Old Navy Global Gap Global Banana Republic Global Other (3) Total 26 Weeks Ended August 1, 2020 U.S. (1) $ 2,675 $ 784 $ 481 $ 584 $ 4,524 Canada 222 97 51 — 370 Europe — 124 5 — 129 Asia 3 266 26 — 295 Other regions 19 36 9 — 64 Total $ 2,919 $ 1,307 $ 572 $ 584 $ 5,382 ($ in millions) Old Navy Global Gap Global Banana Republic Global (2) Other (4) Total 26 Weeks Ended August 3, 2019 U.S. (1) $ 3,435 $ 1,253 $ 1,017 $ 617 $ 6,322 Canada 276 154 100 1 531 Europe — 252 7 — 259 Asia 21 434 49 — 504 Other regions 39 45 11 — 95 Total $ 3,771 $ 2,138 $ 1,184 $ 618 $ 7,711 __________ (1) U.S. includes the United States, Puerto Rico, and Guam. (2) Banana Republic Global fiscal year 2019 net sales include the Janie and Jack brand beginning March 4, 2019. (3) Primarily consists of net sales for the Athleta, Intermix, and Hill City brands. Beginning in fiscal year 2020, Janie and Jack net sales are also included. Net sales for Athleta for the thirteen and twenty-six weeks ended August 1, 2020 were $267 million and $472 million , respectively. (4) Primarily consists of net sales for the Athleta, Intermix, and Hill City brands as well as a portion of income related to our credit card agreement. Net sales for Athleta for the thirteen and twenty-six weeks ended August 3, 2019 were |
Accounting Policies Supplementa
Accounting Policies Supplemental Cash Flow Disclosures (Details) - USD ($) $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 | Feb. 02, 2019 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Cash and cash equivalents | $ 2,188 | $ 1,364 | $ 1,177 | |
Restricted Cash, Current | 33 | 0 | 0 | |
Restricted Cash, Noncurrent | 20 | 17 | 18 | |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents end of period | $ 2,241 | $ 1,381 | $ 1,195 | $ 1,420 |
Accounting Policies Covid-19 (D
Accounting Policies Covid-19 (Details) $ in Millions | Aug. 01, 2020USD ($) |
Accounting Policies [Abstract] | |
Debt Instrument, Face Amount | $ 2,250 |
Line of Credit Facility, Maximum Borrowing Capacity | $ 1,867.5 |
Revenue Revenue Disaggregatio_2
Revenue Revenue Disaggregation (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | ||
Disaggregation of Revenue | |||||
Revenues | $ 3,275 | $ 4,005 | $ 5,382 | $ 7,711 | |
Store Sales | |||||
Disaggregation of Revenue | |||||
Revenues | [1] | 1,642 | 3,166 | 2,750 | 5,989 |
Online Sales | |||||
Disaggregation of Revenue | |||||
Revenues | [2] | $ 1,633 | $ 839 | $ 2,632 | $ 1,722 |
[1] | Store sales primarily include sales made at our Company-operated stores and franchise sales. Fiscal 2020 store sales were negatively impacted by COVID-19. See Note 1 of Notes to Condensed Consolidated Financial Statements for further details. | ||||
[2] | Online sales primarily include sales made through our online channels including curbside pick-up, ship-from-store sales, buy online pick-up in store sales, and order-in-store sales. Additionally, beginning in the second quarter of fiscal 2020, sales from the B2B program are also included. |
Revenue - Additional Informatio
Revenue - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | May 02, 2020 | Feb. 01, 2020 | May 04, 2019 | Feb. 02, 2019 | |
Revenue from Contract with Customer [Abstract] | ||||||||
Contract with Customer Liabilities for Franchise Agreements | $ 0 | $ 0 | $ 0 | $ 0 | ||||
Contract with Customer, Liability | 189 | 195 | 189 | 195 | $ 198 | $ 226 | $ 206 | $ 227 |
Contract with Customer, Liability, Revenue Recognized | $ 63 | $ 71 | $ 118 | $ 134 |
Debt and Credit Facilities Lo_2
Debt and Credit Facilities Long Term Debt (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 | |
Debt Instrument [Line Items] | |||
Document Period End Date | Aug. 1, 2020 | ||
Notes | $ 2,212 | $ 1,249 | $ 1,249 |
Total long-term debt | 2,212 | 1,249 | 1,249 |
Unamortized Debt Issuance Expense | (38) | 0 | 0 |
2021 Notes [Member] | |||
Debt Instrument [Line Items] | |||
Notes | 0 | 1,249 | 1,249 |
2023 Notes [Member] | |||
Debt Instrument [Line Items] | |||
Notes | 500 | 0 | 0 |
2025 Notes [Member] | |||
Debt Instrument [Line Items] | |||
Notes | 750 | 0 | 0 |
2027 Notes [Member] | |||
Debt Instrument [Line Items] | |||
Notes | $ 1,000 | $ 0 | $ 0 |
Debt and Credit Facilities Sc_2
Debt and Credit Facilities Scheduled Maturity of Notes (Details) $ in Millions | 6 Months Ended |
Aug. 01, 2020USD ($) | |
Debt Instrument [Line Items] | |
Debt Instrument, Face Amount | $ 2,250 |
2027 Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Face Amount | $ 1,000 |
Debt Instrument, Interest Rate, Stated Percentage | 8.875% |
Debt Instrument, Payment Terms | Semi-Annual |
2025 Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Face Amount | $ 750 |
Debt Instrument, Interest Rate, Stated Percentage | 8.625% |
Debt Instrument, Payment Terms | Semi-Annual |
2023 Notes [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Face Amount | $ 500 |
Debt Instrument, Interest Rate, Stated Percentage | 8.375% |
Debt Instrument, Payment Terms | Semi-Annual |
Debt and Credit Facilities - Ad
Debt and Credit Facilities - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Debt Instrument [Line Items] | ||||
Debt Instrument, Face Amount | $ 2,250,000,000 | $ 2,250,000,000 | ||
Gain (Loss) on Extinguishment of Debt | 58,000,000 | $ 0 | 58,000,000 | $ 0 |
Estimated fair value | 2,500,000,000 | 2,500,000,000 | ||
Line of Credit Facility, Maximum borrowing capacity | 1,867,500,000 | 1,867,500,000 | ||
Debt Issuance Costs, Gross | 61,000,000 | 61,000,000 | ||
2023 Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Face Amount | $ 500,000,000 | $ 500,000,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.375% | 8.375% | ||
2025 Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Face Amount | $ 750,000,000 | $ 750,000,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.625% | 8.625% | ||
2027 Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Face Amount | $ 1,000,000,000 | $ 1,000,000,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 8.875% | 8.875% | ||
ABL Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Line of Credit Facility, Maximum borrowing capacity | $ 1,867,500,000 | $ 1,867,500,000 | ||
Unsecured committed letter of credit amount | 48,000,000 | 48,000,000 | ||
Borrowings | 0 | 0 | ||
2021 Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Face Amount | $ 1,250,000,000 | $ 1,250,000,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 5.95% | 5.95% | ||
Foreign Facilities [Member] | ||||
Debt Instrument [Line Items] | ||||
Line of Credit Facility, Maximum borrowing capacity | $ 56,000,000 | $ 56,000,000 | ||
Borrowings | 0 | 0 | ||
Bank guarantees related to store leases | 15,000,000 | 15,000,000 | ||
Standby Letters of Credit [Member] | ||||
Debt Instrument [Line Items] | ||||
Unsecured committed letter of credit amount | $ 0 | $ 0 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 |
Assets: | |||
Cash equivalents | $ 368 | $ 311 | $ 312 |
Available-for-Sale Securities | 25 | 290 | 294 |
Derivative financial instruments | 6 | 10 | 27 |
Deferred compensation plan assets | 46 | 51 | 51 |
Debt Securities, Available-for-sale | 2 | 2 | 2 |
Total | 447 | 664 | 686 |
Liabilities: | |||
Derivative financial instruments | 19 | 10 | 9 |
Fair Value, Inputs, Level 1 [Member] | |||
Assets: | |||
Cash equivalents | 19 | 31 | |
Available-for-Sale Securities | 0 | 117 | 131 |
Derivative financial instruments | 0 | 0 | 0 |
Deferred compensation plan assets | 46 | 51 | 51 |
Debt Securities, Available-for-sale | 0 | 0 | 0 |
Total | 46 | 187 | 213 |
Liabilities: | |||
Derivative financial instruments | 0 | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | |||
Assets: | |||
Cash equivalents | 368 | 292 | 281 |
Available-for-Sale Securities | 25 | 173 | 163 |
Derivative financial instruments | 6 | 10 | 27 |
Deferred compensation plan assets | 0 | 0 | 0 |
Debt Securities, Available-for-sale | 0 | 0 | 0 |
Total | 399 | 475 | 471 |
Liabilities: | |||
Derivative financial instruments | 19 | 10 | 9 |
Fair Value, Inputs, Level 3 [Member] | |||
Assets: | |||
Cash equivalents | 0 | 0 | 0 |
Available-for-Sale Securities | 0 | 0 | 0 |
Derivative financial instruments | 0 | 0 | 0 |
Deferred compensation plan assets | 0 | 0 | 0 |
Debt Securities, Available-for-sale | 2 | 2 | 2 |
Total | 2 | 2 | 2 |
Liabilities: | |||
Derivative financial instruments | $ 0 | $ 0 | $ 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | Feb. 01, 2020 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Asset Impairment Charges | $ 0 | $ 0 | $ 0 | ||
Other Asset Impairment Charges | $ 127,000,000 | 3,000,000 | |||
Other indefinite-lived intangible assets impairment charges | 0 | 0 | 0 | 0 | |
Transfers into or out of level 2 | 0 | 0 | 0 | 0 | |
Fair Value Asset Level 3 Transfer Amount | 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 | |
Available-for-sale Securities, Current | 25,000,000 | 294,000,000 | 25,000,000 | 294,000,000 | $ 290,000,000 |
Cash and Cash Equivalents, Fair Value Disclosure | 0 | 15,000,000 | 0 | 15,000,000 | |
Debt Securities, Available-for-sale, Unrealized Gain (Loss) | 0 | 0 | 0 | 0 | |
Other-than-temporary Impairment Loss, Debt Securities, Available-for-sale | $ 0 | $ 0 | $ 0 | $ 0 |
Fair Value Measurements Long Li
Fair Value Measurements Long Lived Assets Impairments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Long Lived Assets [Line Items] | ||||
Goodwill, Impairment Loss | $ 0 | $ 0 | $ 0 | $ 0 |
Asset Impairment Charges | 0 | $ 0 | $ 0 | |
Store Assets [Member] | ||||
Long Lived Assets [Line Items] | ||||
Total Impairment Charges | 127 | |||
Long Lived Asset Carrying Value | 131 | 131 | ||
Impaired Asset at Fair Value | 4 | 4 | ||
Operating lease Impairment [Member] | ||||
Long Lived Assets [Line Items] | ||||
Total Impairment Charges | 361 | |||
Long Lived Asset Carrying Value | 1,369 | 1,369 | ||
Impaired Asset at Fair Value | $ 1,008 | $ 1,008 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Foreign Exchange Contracts Outstanding to Sell Various Currencies (Details) - USD ($) $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 |
Derivative [Line Items] | |||
Derivative, Notional Amount | $ 941 | $ 1,190 | $ 1,698 |
Derivatives in cash flow hedging relationships | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | 214 | 501 | 652 |
Not Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Derivative, Notional Amount | $ 727 | $ 689 | $ 1,046 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Fair Values of Asset and Liability Derivative Financial Instruments (Details) - USD ($) $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 |
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | $ 6 | $ 10 | $ 27 |
Derivative financial instruments, liabilities | 19 | 10 | 9 |
Foreign Exchange Forward Contract | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 6 | 10 | 27 |
Derivative financial instruments, liabilities | 19 | 10 | 9 |
Derivatives in cash flow hedging relationships | Foreign Exchange Forward Contract | Other Current Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 3 | 6 | 15 |
Derivatives in cash flow hedging relationships | Foreign Exchange Forward Contract | Other Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 0 | 0 | 1 |
Derivatives in cash flow hedging relationships | Foreign Exchange Forward Contract | Accrued Liabilities Current [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | 1 | 2 | 1 |
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 | 1 |
Not Designated as Hedging Instrument | Foreign Exchange Forward Contract | Other Current Assets [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, assets | 3 | 4 | 11 |
Not Designated as Hedging Instrument | Foreign Exchange Forward Contract | Accrued Liabilities Current [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Derivative financial instruments, liabilities | $ 18 | $ 8 | $ 7 |
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 | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Derivative Instruments, (Gain) Loss [Line Items] | ||||
Cost of goods sold and occupancy expenses | $ 2,126 | $ 2,449 | $ 3,965 | $ 4,811 |
Operating Expenses | 1,076 | 1,274 | 2,588 | 2,302 |
Cost of Goods Sold and Occupancy Expense | ||||
Derivative Instruments, (Gain) Loss [Line Items] | ||||
(Gain) loss reclassified from accumulated OCI into income, effective portion, net | (7) | (6) | (11) | (12) |
Operating Expenses [Member] | ||||
Derivative Instruments, (Gain) Loss [Line Items] | ||||
(Gain) loss reclassified from accumulated OCI into income, effective portion, net | 32 | (3) | (12) | |
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 | (9) | 2 | 12 | 15 |
Foreign Exchange Forward Contract | Cost of Goods Sold and Occupancy Expense | Not Designated as Hedging Instrument | ||||
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 | 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 | (7) | (6) | (11) | (12) |
Foreign Exchange Forward Contract | Operating Expenses [Member] | Not Designated as Hedging Instrument | ||||
Derivative Instruments, (Gain) Loss [Line Items] | ||||
(Gain) loss reclassified from accumulated OCI into income, effective portion, net | 32 | (3) | (11) | (12) |
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 ($) $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 |
Derivative [Line Items] | |||
Amounts Subject to Enforceable Master Netting Arrangements | $ 0 | $ 0 | $ 0 |
Share Repurchase Activity (Deta
Share Repurchase Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | ||
Disclosure Share Repurchase Activity [Abstract] | |||||
Number of shares repurchased | [1] | 0 | 2.7 | 0 | 4.6 |
Total cost | $ 0 | $ 50 | $ 0 | $ 100 | |
Average per share cost including commissions (in dollars per share) | $ 0 | $ 18.41 | $ 0 | $ 21.54 | |
[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 ($) | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 | Feb. 26, 2019 |
Disclosure Share Repurchases Additional Information [Abstract] | ||||
Stock Repurchase Program, Authorized Amount | $ 1,000,000,000 | |||
Share repurchases, remaining amount | $ 800,000,000 | |||
Stock Repurchase Program Amount Not Paid | $ 0 | $ 0 | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Effective Income Tax Rate, Percent | 51.20% | (38.00%) | (23.50%) | (31.10%) |
Decrease In Gross Unrecognized Tax Benefits Within The Next 12 Months | $ 12 | $ 12 | ||
Benefit To Income Taxes If Decrease In Gross Unrecognized Tax Benefits Within 12 Months Are Recognized | $ 0 |
Earnings (Loss) Per Share - Wei
Earnings (Loss) Per Share - Weighted Average Number of Shares (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | ||
Earnings Per Share [Abstract] | |||||
Weighted-average number of shares - basic (in shares) | 374 | 378 | 373 | 378 | |
Common stock equivalents (in shares) | [1] | 0 | 1 | 0 | 2 |
Weighted-average number of shares - diluted (in shares) | 374 | 379 | 373 | 380 | |
[1] | For the thirteen and twenty-six weeks ended August 1, 2020 , the dilutive impact of outstanding options and awards was excluded from dilutive shares as a result of the Company’s net loss for the respective periods. |
Earnings (Loss) Per Share - Add
Earnings (Loss) Per Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Earnings Per Share [Abstract] | ||||
Shares excluded from the computations of weighted-average number of shares - diluted | 16 | 17 | 15 | 13 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | Aug. 01, 2020 | Feb. 01, 2020 | Aug. 03, 2019 |
Commitments and Contingencies [Line Items] | |||
Loss Contingency, Estimate of Possible Loss | $ 0 | $ 0 | $ 0 |
Segment Information - Net Sales
Segment Information - Net Sales by Brand and Region (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 01, 2020 | Aug. 03, 2019 | Aug. 01, 2020 | Aug. 03, 2019 | |
Segment Reporting Information [Line Items] | ||||
Net Sales | $ 3,275 | $ 4,005 | $ 5,382 | $ 7,711 |
U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 2,763 | 3,300 | 4,524 | 6,322 |
Canada | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 235 | 286 | 370 | 531 |
Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 72 | 135 | 129 | 259 |
Asia | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 174 | 235 | 295 | 504 |
Other Regions | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 31 | 49 | 64 | 95 |
Old Navy | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 1,881 | 1,972 | 2,919 | 3,771 |
Old Navy | U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 1,726 | 1,794 | 2,675 | 3,435 |
Old Navy | Canada | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 145 | 148 | 222 | 276 |
Old Navy | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 0 |
Old Navy | Asia | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 2 | 11 | 3 | 21 |
Old Navy | Other Regions | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 8 | 19 | 19 | 39 |
Gap | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 783 | 1,086 | 1,307 | 2,138 |
Gap | U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 473 | 645 | 784 | 1,253 |
Gap | Canada | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 63 | 85 | 97 | 154 |
Gap | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 70 | 131 | 124 | 252 |
Gap | Asia | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 158 | 201 | 266 | 434 |
Gap | Other Regions | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 19 | 24 | 36 | 45 |
Banana Republic [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 283 | 616 | 572 | 1,184 |
Banana Republic [Member] | U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 236 | 530 | 481 | 1,017 |
Banana Republic [Member] | Canada | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 27 | 53 | 51 | 100 |
Banana Republic [Member] | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 2 | 4 | 5 | 7 |
Banana Republic [Member] | Asia | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 14 | 23 | 26 | 49 |
Banana Republic [Member] | Other Regions | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 4 | 6 | 9 | 11 |
Other entities [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 328 | 331 | 584 | 618 |
Other entities [Member] | U.S. | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 328 | 331 | 584 | 617 |
Other entities [Member] | Canada | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 1 |
Other entities [Member] | Europe | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 0 |
Other entities [Member] | Asia | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 0 |
Other entities [Member] | Other Regions | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | 0 | 0 | 0 | 0 |
Athleta [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Net Sales | $ 267 | $ 252 | $ 472 | $ 475 |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 6 Months Ended |
Aug. 01, 2020Segment | |
Segment Reporting [Abstract] | |
Number of reportable segments (in segments) | 1 |
Store Closing and Other Opera_2
Store Closing and Other Operating Cost Store Closing and Other Operating Cost (Details) $ in Millions | 6 Months Ended |
Aug. 01, 2020USD ($) | |
Restructuring and Related Activities [Abstract] | |
Restructuring Costs | $ 0 |