Cover Page
Cover Page - shares | 6 Months Ended | |
Aug. 04, 2023 | Aug. 28, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Aug. 04, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-7898 | |
Entity Incorporation, State or Country Code | NC | |
Entity Tax Identification Number | 56-0578072 | |
Entity Address, Address Line One | 1000 Lowes Blvd. | |
Entity Address, City or Town | Mooresville | |
Entity Address, State or Province | NC | |
Entity Address, Postal Zip Code | 28117 | |
City Area Code | 704 | |
Local Phone Number | 758-1000 | |
Title of each class | Common Stock, par value $0.50 per share | |
Trading Symbol | LOW | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity small business | false | |
Entity emerging growth company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 577,115,219 | |
Entity Registrant Name | LOWES COMPANIES INC | |
Entity Central Index Key | 0000060667 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --02-02 |
Consolidated Statements of Earn
Consolidated Statements of Earnings (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Current Earnings | ||||
Net sales | $ 24,956 | $ 27,476 | $ 47,304 | $ 51,135 |
Cost of sales | 16,557 | 18,343 | 31,378 | 33,952 |
Gross margin | 8,399 | 9,133 | 15,926 | 17,183 |
Expenses: | ||||
Selling, general and administrative | 4,086 | 4,455 | 7,912 | 8,758 |
Depreciation and amortization | 427 | 449 | 841 | 894 |
Operating income | 3,886 | 4,229 | 7,173 | 7,531 |
Interest – net | 341 | 264 | 689 | 507 |
Pre-tax earnings | 3,545 | 3,965 | 6,484 | 7,024 |
Income tax provision | 872 | 973 | 1,551 | 1,699 |
Net earnings | $ 2,673 | $ 2,992 | $ 4,933 | $ 5,325 |
Weighted-average common shares outstanding - basic (in shares) | 584 | 638 | 590 | 649 |
Basic earnings per common share (in dollars per share) | $ 4.56 | $ 4.68 | $ 8.34 | $ 8.18 |
Weighted-average common shares outstanding - diluted (in shares) | 585 | 639 | 591 | 651 |
Diluted earnings per common share (in dollars per share) | $ 4.56 | $ 4.67 | $ 8.32 | $ 8.16 |
Current Earnings (Percentages) | ||||
Net sales | 100% | 100% | 100% | 100% |
Cost of sales | 66.34% | 66.76% | 66.33% | 66.40% |
Gross margin | 33.66% | 33.24% | 33.67% | 33.60% |
Expenses (Percentages): | ||||
Selling, general and administrative | 16.38% | 16.22% | 16.73% | 17.12% |
Depreciation and amortization | 1.71% | 1.63% | 1.78% | 1.75% |
Operating income | 15.57% | 15.39% | 15.16% | 14.73% |
Interest – net | 1.36% | 0.96% | 1.45% | 0.99% |
Pre-tax earnings | 14.21% | 14.43% | 13.71% | 13.74% |
Income tax provision | 3.50% | 3.54% | 3.28% | 3.33% |
Net earnings | 10.71% | 10.89% | 10.43% | 10.41% |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Comprehensive Income | ||||
Net earnings | $ 2,673 | $ 2,992 | $ 4,933 | $ 5,325 |
Foreign currency translation adjustments – net of tax | 5 | 12 | 5 | (5) |
Cash flow hedges – net of tax | (3) | (38) | (6) | 181 |
Other | 0 | (1) | 0 | (3) |
Other comprehensive income/(loss) | 2 | (27) | (1) | 173 |
Comprehensive income | $ 2,675 | $ 2,965 | $ 4,932 | $ 5,498 |
Comprehensive Income (Percentages) | ||||
Net earnings | 10.71% | 10.89% | 10.43% | 10.41% |
Foreign currency translation adjustments – net of tax | 0.01% | 0.05% | 0.01% | (0.02%) |
Cash flow hedges – net of tax | (0.01%) | (0.14%) | (0.02%) | 0.36% |
Other | 0% | 0% | 0% | 0.01% |
Other comprehensive income/(loss) | 0% | (0.09%) | (0.01%) | 0.35% |
Comprehensive income | 10.71% | 10.80% | 10.42% | 10.76% |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Current assets: | |||
Cash and cash equivalents | $ 3,494 | $ 1,348 | $ 1,482 |
Short-term investments | 374 | 384 | 450 |
Merchandise inventory – net | 17,422 | 18,532 | 19,329 |
Other current assets | 946 | 1,178 | 1,406 |
Total current assets | 22,236 | 21,442 | 22,667 |
Property, less accumulated depreciation | 17,373 | 17,567 | 18,713 |
Operating lease right-of-use assets | 3,650 | 3,518 | 4,158 |
Long-term investments | 182 | 121 | 56 |
Deferred income taxes – net | 230 | 250 | 104 |
Other assets | 850 | 810 | 1,027 |
Total assets | 44,521 | 43,708 | 46,725 |
Current liabilities: | |||
Short-term borrowings | 0 | 499 | 0 |
Current maturities of long-term debt | 592 | 585 | 121 |
Current operating lease liabilities | 534 | 522 | 652 |
Accounts payable | 10,333 | 10,524 | 12,631 |
Accrued compensation and employee benefits | 1,026 | 1,109 | 1,227 |
Deferred revenue | 1,566 | 1,603 | 1,968 |
Income taxes payable | 91 | 1,181 | 330 |
Other current liabilities | 3,470 | 3,488 | 3,437 |
Total current liabilities | 17,612 | 19,511 | 20,366 |
Long-term debt, excluding current maturities | 35,839 | 32,876 | 28,763 |
Noncurrent operating lease liabilities | 3,611 | 3,512 | 4,069 |
Deferred revenue – Lowe's protection plans | 1,231 | 1,201 | 1,169 |
Other liabilities | 960 | 862 | 800 |
Total liabilities | 59,253 | 57,962 | 55,167 |
Shareholders' deficit: | |||
Preferred stock, $5 par value: Authorized – 5.0 million shares; Issued and outstanding – none | 0 | 0 | 0 |
Common stock, $0.50 par value: Authorized - 5.6 billion shares; Issued and outstanding - 582 million, 601 million, and 631 million shares, respectively | 291 | 301 | 316 |
Capital in excess of par value | 12 | 0 | 0 |
Accumulated deficit | (15,341) | (14,862) | (8,895) |
Accumulated other comprehensive income | 306 | 307 | 137 |
Total shareholders' deficit | (14,732) | (14,254) | (8,442) |
Total liabilities and shareholders' deficit | $ 44,521 | $ 43,708 | $ 46,725 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Statement of Financial Position [Abstract] | |||
Preferred stock, par value (in dollars per share) | $ 5 | $ 5 | $ 5 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.50 | $ 0.50 | $ 0.50 |
Common stock, shares authorized (in shares) | 5,600,000,000 | 5,600,000,000 | 5,600,000,000 |
Common stock, shares issued (in shares) | 582,000,000 | 601,000,000 | 631,000,000 |
Common stock, shares outstanding (in shares) | 582,000,000 | 601,000,000 | 631,000,000 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Deficit (Unaudited) - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Capital in Excess of Par Value | Accumulated Deficit | Accumulated Other Comprehensive Income |
Beginning balance (in shares) at Jan. 28, 2022 | 670 | ||||
Beginning balance at Jan. 28, 2022 | $ (4,816) | $ 335 | $ 0 | $ (5,115) | $ (36) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 5,325 | 5,325 | |||
Other comprehensive income (loss) | 173 | 173 | |||
Cash dividends declared | (1,190) | (1,190) | |||
Share-based payment expense | 110 | 110 | |||
Repurchases of common stock (in shares) | (41) | ||||
Repurchases of common stock | (8,118) | $ (20) | (183) | (7,915) | |
Issuance of common stock under share-based payment plans (in shares) | 2 | ||||
Issuance of common stock under share-based payment plans | $ 74 | $ 1 | 73 | ||
Ending balance (in shares) at Jul. 29, 2022 | 631 | 631 | |||
Ending balance at Jul. 29, 2022 | $ (8,442) | $ 316 | 0 | (8,895) | 137 |
Beginning balance (in shares) at Apr. 29, 2022 | 652 | ||||
Beginning balance at Apr. 29, 2022 | (6,877) | $ 326 | 0 | (7,367) | 164 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 2,992 | 2,992 | |||
Other comprehensive income (loss) | (27) | (27) | |||
Cash dividends declared | (666) | (666) | |||
Share-based payment expense | 65 | 65 | |||
Repurchases of common stock (in shares) | (22) | ||||
Repurchases of common stock | (4,002) | $ (11) | (137) | (3,854) | |
Issuance of common stock under share-based payment plans (in shares) | 1 | ||||
Issuance of common stock under share-based payment plans | $ 73 | $ 1 | 72 | ||
Ending balance (in shares) at Jul. 29, 2022 | 631 | 631 | |||
Ending balance at Jul. 29, 2022 | $ (8,442) | $ 316 | 0 | (8,895) | 137 |
Beginning balance (in shares) at Feb. 03, 2023 | 601 | 601 | |||
Beginning balance at Feb. 03, 2023 | $ (14,254) | $ 301 | 0 | (14,862) | 307 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 4,933 | 4,933 | |||
Other comprehensive income (loss) | (1) | (1) | |||
Cash dividends declared | (1,266) | (1,266) | |||
Share-based payment expense | 113 | 113 | |||
Repurchases of common stock (in shares) | (21) | ||||
Repurchases of common stock | (4,333) | $ (11) | (176) | (4,146) | |
Issuance of common stock under share-based payment plans (in shares) | 2 | ||||
Issuance of common stock under share-based payment plans | $ 76 | $ 1 | 75 | ||
Ending balance (in shares) at Aug. 04, 2023 | 582 | 582 | |||
Ending balance at Aug. 04, 2023 | $ (14,732) | $ 291 | 12 | (15,341) | 306 |
Beginning balance (in shares) at May. 05, 2023 | 592 | ||||
Beginning balance at May. 05, 2023 | (14,710) | $ 296 | 0 | (15,310) | 304 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net earnings | 2,673 | 2,673 | |||
Other comprehensive income (loss) | 2 | 2 | |||
Cash dividends declared | (641) | (641) | |||
Share-based payment expense | 58 | 58 | |||
Repurchases of common stock (in shares) | (10) | ||||
Repurchases of common stock | (2,185) | $ (5) | (117) | (2,063) | |
Issuance of common stock under share-based payment plans (in shares) | 0 | ||||
Issuance of common stock under share-based payment plans | $ 71 | $ 0 | 71 | ||
Ending balance (in shares) at Aug. 04, 2023 | 582 | 582 | |||
Ending balance at Aug. 04, 2023 | $ (14,732) | $ 291 | $ 12 | $ (15,341) | $ 306 |
Consolidated Statements of Sh_2
Consolidated Statements of Shareholders' Deficit (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||||
Cash dividends per share (in dollars per share) | $ 1.10 | $ 1.05 | $ 2.15 | $ 1.85 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Aug. 04, 2023 | Jul. 29, 2022 | |
Cash flows from operating activities: | ||
Net earnings | $ 4,933 | $ 5,325 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 941 | 1,007 |
Noncash lease expense | 241 | 273 |
Deferred income taxes | 23 | 0 |
Asset impairment and loss on property – net | 23 | 32 |
Gain on sale of business | (67) | 0 |
Share-based payment expense | 113 | 110 |
Changes in operating assets and liabilities: | ||
Merchandise inventory – net | 1,109 | (1,728) |
Other operating assets | 224 | (120) |
Accounts payable | (191) | 1,279 |
Deferred revenue | (6) | 97 |
Other operating liabilities | (1,375) | (263) |
Net cash provided by operating activities | 5,968 | 6,012 |
Cash flows from investing activities: | ||
Purchases of investments | (878) | (330) |
Proceeds from sale/maturity of investments | 811 | 290 |
Capital expenditures | (765) | (687) |
Proceeds from sale of property and other long-term assets | 17 | 19 |
Proceeds from sale of business | 123 | 0 |
Other – net | (23) | (1) |
Net cash used in investing activities | (715) | (709) |
Cash flows from financing activities: | ||
Net change in commercial paper | (499) | 0 |
Net proceeds from issuance of debt | 2,983 | 4,964 |
Repayment of debt | (45) | (799) |
Proceeds from issuance of common stock under share-based payment plans | 76 | 72 |
Cash dividend payments | (1,257) | (1,061) |
Repurchases of common stock | (4,356) | (8,128) |
Other – net | (9) | (2) |
Net cash used in financing activities | (3,107) | (4,954) |
Net increase in cash and cash equivalents | 2,146 | 349 |
Cash and cash equivalents, beginning of period | 1,348 | 1,133 |
Cash and cash equivalents, end of period | $ 3,494 | $ 1,482 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Aug. 04, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements (unaudited) and notes to the condensed consolidated financial statements (unaudited) are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The condensed consolidated financial statements (unaudited), in the opinion of management, contain all normal recurring adjustments necessary to present fairly the consolidated balance sheets as of August 4, 2023, and July 29, 2022, and the statements of earnings, comprehensive income, and shareholders’ deficit for the three and six months ended August 4, 2023, and July 29, 2022, and cash flows for the six months ended August 4, 2023, and July 29, 2022. The February 3, 2023, consolidated balance sheet was derived from the audited financial statements. These interim condensed consolidated financial statements (unaudited) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Lowe’s Companies, Inc. (the Company) Annual Report on Form 10-K for the fiscal year ended February 3, 2023 (the Annual Report). The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year. Accounting Pronouncements Not Yet Adopted Recent accounting pronouncements pending adoption not discussed in this Form 10-Q or in the 2022 Form 10-K are either not applicable to the Company or are not expected to have a material impact on the Company. |
Revenue
Revenue | 6 Months Ended |
Aug. 04, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Net sales consists primarily of revenue, net of sales tax, associated with contracts with customers for the sale of goods and services in amounts that reflect consideration the Company is entitled to in exchange for those goods and services. The following table presents the Company’s sources of revenue: (In millions) Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Products $ 24,035 $ 26,477 $ 45,605 $ 49,360 Services 578 588 1,107 1,125 Other 343 411 592 650 Net sales $ 24,956 $ 27,476 $ 47,304 $ 51,135 A provision for anticipated merchandise returns is provided through a reduction of sales and cost of sales in the period that the related sales are recorded. The merchandise return reserve is presented on a gross basis, with a separate asset and liability included in the consolidated balance sheets. The balances and classification within the consolidated balance sheets for anticipated sales returns and the associated right of return assets are as follows: (In millions) Classification August 4, July 29, February 3, Anticipated sales returns Other current liabilities $ 256 $ 302 $ 234 Right of return assets Other current assets 149 183 139 Deferred revenue - retail and stored-value cards Retail deferred revenue consists of amounts received for which customers have not yet taken possession of the merchandise or for which installation has not yet been completed. The majority of revenue for goods and services is recognized in the quarter following revenue deferral. Stored-value cards deferred revenue includes outstanding stored-value cards such as gift cards and returned merchandise credits that have not yet been redeemed. Deferred revenue for retail and stored-value cards are as follows: (In millions) August 4, July 29, February 3, Retail deferred revenue $ 1,006 $ 1,397 $ 933 Stored-value cards deferred revenue 560 571 670 Deferred revenue $ 1,566 $ 1,968 $ 1,603 Deferred revenue - Lowe’s protection plans The Company defers revenues for its separately-priced long-term extended protection plan contracts (Lowe’s protection plans) and recognizes revenue on a straight-line basis over the respective contract term. Expenses for claims are recognized in cost of sales when incurred. (In millions) August 4, July 29, February 3, Deferred revenue - Lowe’s protection plans $ 1,231 $ 1,169 $ 1,201 Three Months Ended Six Months Ended (In millions) August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Lowe’s protection plans deferred revenue recognized into sales $ 136 $ 129 $ 272 $ 256 Lowe’s protection plans claim expenses 54 48 107 93 Disaggregation of Revenues The following table presents the Company’s net sales disaggregated by merchandise division: Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 (In millions) Net Sales % Net Sales % Net Sales % Net Sales % Home Décor 1 $ 8,725 35.0 % $ 9,521 34.7 % $ 16,962 35.9 % $ 18,209 35.6 % Hardlines 2 8,348 33.5 8,900 32.4 15,165 32.1 15,599 30.5 Building Products 3 7,245 29.0 8,347 30.4 14,032 29.7 16,116 31.5 Other 638 2.5 708 2.5 1,145 2.3 1,211 2.4 Total $ 24,956 100.0 % $ 27,476 100.0 % $ 47,304 100.0 % $ 51,135 100.0 % Note: Merchandise division net sales for the prior period have been reclassified to conform to the current period presentation. 1 Home Décor includes the following product categories: Appliances, Décor, Flooring, Kitchens & Bath, and Paint. 2 Hardlines includes the following product categories: Hardware, Lawn & Garden, Seasonal & Outdoor Living, and Tools. 3 Building Products includes the following product categories: Building Materials, Electrical, Lumber, Millwork, and Rough Plumbing. The following table presents the Company’s net sales disaggregated by geographical area: (In millions) Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 United States $ 24,956 $ 25,817 $ 47,304 $ 48,243 Canada 1 — 1,659 — 2,892 Net Sales $ 24,956 $ 27,476 $ 47,304 $ 51,135 1 The Canadian retail business was sold on February 3, 2023. |
Restricted Investments
Restricted Investments | 6 Months Ended |
Aug. 04, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Restricted Investments | Restricted Investments Short-term and long-term investments include restricted balances pledged as collateral primarily for the Lowe’s protection plans program and are as follows: (In millions) August 4, 2023 July 29, 2022 February 3, 2023 Short-term restricted investments $ 374 $ 450 $ 384 Long-term restricted investments 182 56 100 Total restricted investments $ 556 $ 506 $ 484 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Aug. 04, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The authoritative guidance for fair value measurements establishes a three-level hierarchy, which encourages an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The three levels of the hierarchy are defined as follows: • Level 1 - inputs to the valuation techniques that are quoted prices in active markets for identical assets or liabilities • Level 2 - inputs to the valuation techniques that are other than quoted prices but are observable for the assets or liabilities, either directly or indirectly • Level 3 - inputs to the valuation techniques that are unobservable for the assets or liabilities Assets and Liabilities that are Measured at Fair Value on a Recurring Basis The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of August 4, 2023, July 29, 2022, and February 3, 2023: Fair Value Measurements at (In millions) Classification Measurement Level August 4, July 29, February 3, Available-for-sale debt securities: U.S. Treasury securities Short-term investments Level 1 $ 138 $ 214 $ 157 Money market funds Short-term investments Level 1 85 119 43 Certificates of deposit Short-term investments Level 1 72 4 40 Corporate debt securities Short-term investments Level 2 62 54 78 Commercial paper Short-term investments Level 2 17 35 52 Foreign government debt securities Short-term investments Level 2 — 14 14 Municipal obligations Short-term investments Level 2 — 10 — U.S. Treasury securities Long-term investments Level 1 166 31 86 Corporate debt securities Long-term investments Level 2 14 23 12 Municipal obligations Long-term investments Level 2 2 2 2 Derivative instruments: Forward interest rate swaps Other current assets Level 2 $ — $ 216 $ 251 Fixed-to-floating interest rate swaps Other liabilities Level 2 92 56 88 Other financial instruments: Contingent consideration Long-term investments Level 3 $ — $ — $ 21 There were no transfers between Levels 1, 2, or 3 during any of the periods presented. When available, quoted prices were used to determine fair value. When quoted prices in active markets were available, financial assets were classified within Level 1 of the fair value hierarchy. When quoted prices in active markets were not available, fair values for financial assets and liabilities classified within Level 2 were determined using pricing models, and the inputs to those pricing models were based on observable market inputs. The inputs to the pricing models were typically benchmark yields, reported trades, broker-dealer quotes, issuer spreads and benchmark securities, among others. The performance-based contingent consideration is related to the fiscal 2022 sale of the Canadian retail business and is classified as a Level 3 long-term investment. The Company determined the initial fair value of contingent consideration as of February 3, 2023, based on an income approach using an option pricing model, calculated using significant unobservable inputs such as total equity value, volatility, and expected term. Subsequent measurements of fair value of the contingent consideration are based on an income approach, which requires certain assumptions considering operating performance of the business and a risk-adjusted discount rate. Changes in the estimated fair value of the contingent consideration are recognized as gain or loss included within selling, general and administrative expense in the consolidated statements of earnings. The rollforward of the fair value of contingent consideration for the three and six months ended August 4, 2023, is as follows: Three Months Ended Six Months Ended (In millions) August 4, 2023 August 4, 2023 Beginning balance $ — $ 21 Change in fair value — 102 Proceeds received — (123) Ending balance $ — $ — Assets and Liabilities that are Measured at Fair Value on a Nonrecurring Basis During the three and six months ended August 4, 2023, and July 29, 2022, the Company had no material measurements of assets and liabilities at fair value on a nonrecurring basis subsequent to their initial recognition. Other Fair Value Disclosures The Company’s financial assets and liabilities not measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, short-term borrowings, accounts payable, and long-term debt and are reflected in the financial statements at cost. With the exception of long-term debt, cost approximates fair value for these items due to their short-term nature. As further described in Note 7 , certain long-term debt is associated with a fair value hedge and the changes in fair value of the hedged debt is included in the carrying value of long-term debt on the consolidated balance sheets. The fair values of the Company’s unsecured notes were estimated using quoted market prices. The fair values of the Company’s mortgage notes were estimated using discounted cash flow analyses, based on the future cash outflows associated with these arrangements and discounted using the applicable incremental borrowing rate. Carrying amounts and the related estimated fair value of the Company’s long-term debt, excluding finance lease obligations, are as follows: August 4, 2023 July 29, 2022 February 3, 2023 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Unsecured notes (Level 1) $ 35,881 $ 31,898 $ 28,237 $ 26,586 $ 32,897 $ 30,190 Mortgage notes (Level 2) 2 2 4 5 2 2 Long-term debt (excluding finance lease obligations) $ 35,883 $ 31,900 $ 28,241 $ 26,591 $ 32,899 $ 30,192 |
Accounts Payable
Accounts Payable | 6 Months Ended |
Aug. 04, 2023 | |
Payables and Accruals [Abstract] | |
Accounts Payable | Accounts PayableThe Company has agreements with third parties to provide supplier finance programs which facilitate participating suppliers’ ability to finance payment obligations from the Company with designated third-party financial institutions. Participating suppliers may, at their sole discretion, make offers to finance one or more payment obligations of the Company prior to their scheduled due dates at a discounted price to participating financial institutions. The Company’s outstanding payment obligations that suppliers financed to participating financial institutions, which are included in accounts payable on the consolidated balance sheets, are as follows: (In millions) August 4, 2023 July 29, 2022 February 3, 2023 Financed payment obligations $ 1,475 $ 2,320 $ 2,257 |
Debt
Debt | 6 Months Ended |
Aug. 04, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt Commercial Paper Program The Company’s commercial paper program is supported by the $2.0 billion five-year unsecured revolving credit agreement entered into in March 2020, and as amended (2020 Credit Agreement), and the $2.0 billion five-year unsecured third amended and restated credit agreement entered into in December 2021, and as amended (Third Amended and Restated Credit Agreement). The amounts available to be drawn under the 2020 Credit Agreement and the Third Amended and Restated Credit Agreement are reduced by the amount of borrowings under the commercial paper program. As of August 4, 2023, and July 29, 2022, there were no outstanding borrowings under the Company’s commercial paper program, the 2020 Credit Agreement, or the Third Amended and Restated Credit Agreement. As of February 3, 2023, there were $499 million of outstanding borrowings under the Company’s commercial paper program with a weighted average interest rate of 4.78%. There were no outstanding borrowings under the Company’s 2020 Credit Agreement or the Third Amended and Restated Credit Agreement as of February 3, 2023. Total combined availability under the 2020 Credit Agreement and the Third Amended and Restated Credit Agreement was $4.0 billion as of August 4, 2023. Long-Term Debt On March 30, 2023, the Company issued $3.0 billion of unsecured fixed rate notes (March 2023 Notes) as follows: Principal Amount Maturity Date Interest Rate Discount $ 1,000 April 2026 4.800% $ 3 $ 1,000 July 2033 5.150% $ 4 $ 500 July 2053 5.750% $ 5 $ 500 April 2063 5.850% $ 5 Interest on the March 2023 Notes with April maturity dates is payable semiannually in arrears in April and October of each year until maturity. Interest on the March 2023 Notes with July maturity dates is payable semiannually in arrears in January and July of each year until maturity. |
Derivative Instruments
Derivative Instruments | 6 Months Ended |
Aug. 04, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments The Company utilizes forward interest rate swap agreements to hedge its exposure to changes in benchmark interest rates on forecasted debt issuances. The Company also utilizes fixed-to-floating interest rate swap agreements as fair value hedges on certain debt. The notional amounts for the Company’s material derivative instruments are as follows: (In millions) August 4, July 29, February 3, Cash flow hedges: Forward interest rate swap agreement notional amounts $ — $ 2,065 $ 1,290 Fair value hedges: Fixed-to-floating interest rate swap agreement notional amounts $ 850 $ 850 $ 850 See Note 4 for the gross fair values of the Company’s outstanding derivative financial instruments and corresponding fair value classifications. The cash flows related to settlement of the Company’s hedging derivative financial instruments are classified in the consolidated statements of cash flows based on the nature of the underlying hedged items. Cash Flow Hedges The Company accounts for the forward interest rate swap contracts as cash flow hedges, thus the effective portion of gains and losses resulting from changes in fair value are recognized in other comprehensive income/(loss), net of tax effects, in the consolidated statements of comprehensive income and is amortized to interest expense over the term of the respective debt. In connection with the issuance of our March 2023 Notes, we settled forward interest rate swap contracts with a combined notional amount of $2.0 billion and received a payment of $247 million. The (loss)/gain from forward interest rate swap agreements, both settled and outstanding, designated as cash flow hedges recorded in other comprehensive income/(loss) and net earnings for the three and six months ended August 4, 2023, and July 29, 2022, including its line item in the financial statements, is as follows: (In millions) Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Other comprehensive income/(loss): Cash flow hedges – net of tax benefit/(expense) of $1 million, $12 million, $3 million, and ($61) million, respectively $ (3) $ (34) $ (6) $ 184 Net earnings: Interest – net $ 4 $ — $ 7 $ (1) Fair Value Hedges |
Shareholders' Deficit
Shareholders' Deficit | 6 Months Ended |
Aug. 04, 2023 | |
Stockholders' Equity Note [Abstract] | |
Shareholders' Deficit | Shareholders’ Deficit The Company has a share repurchase program that is executed through purchases made from time to time either in the open market, which may be made under pre-set trading plans meeting the requirements of Rule 10b5-1(c) of the Securities Exchange Act of 1934, or through private off-market transactions. Shares purchased under the repurchase program are returned to authorized and unissued status. Any excess of cost over par value is charged to additional paid-in capital to the extent that a balance is present. Once additional paid-in capital is fully depleted, remaining excess of cost over par value is charged to accumulated deficit. As of August 4, 2023, the Company had $16.6 billion remaining in its share repurchase program. During the six months ended August 4, 2023, the Company entered into Accelerated Share Repurchase (ASR) agreements with third-party financial institutions to repurchase a total of 8.4 million shares of the Company’s common stock for $1.8 billion. The terms of the ASR agreements entered into during the six months ended August 4, 2023, are as follows (in millions): Agreement Execution Agreement Settlement ASR Initial Shares Delivered at Inception Additional Shares Delivered at Settlement Total Shares Delivered Q1 2023 Q1 2023 $ 750 3.1 0.7 3.8 Q2 2023 Q2 2023 1,000 3.9 0.7 4.6 In addition, the Company repurchased shares of its common stock through the open market as follows: Three Months Ended Six Months Ended August 4, 2023 August 4, 2023 (In millions) Shares Cost Shares Cost Open market share repurchases 5.5 $ 1,182 11.6 $ 2,450 The Company also withholds shares from employees to satisfy either the exercise price of stock options exercised or the statutory withholding tax liability resulting from the vesting of share-based awards. Total shares repurchased for the three and six months ended August 4, 2023, and July 29, 2022, were as follows: Three Months Ended August 4, 2023 July 29, 2022 (In millions) Shares Cost Shares Cost Share repurchase program 1 10.1 $ 2,182 21.5 $ 4,000 Shares withheld from employees — 3 0.1 2 Total share repurchases 10.1 $ 2,185 21.6 $ 4,002 Six Months Ended August 4, 2023 July 29, 2022 (In millions) Shares Cost Shares Cost Share repurchase program 1 20.0 $ 4,200 40.1 $ 8,000 Shares withheld from employees 0.7 133 0.6 119 Total share repurchases 20.7 $ 4,333 40.7 $ 8,119 1 Beginning January 1, 2023, share repurchases in excess of issuances are subject to a 1% excise tax, which is included as part of the cost basis of the shares acquired. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Aug. 04, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The Company calculates basic and diluted earnings per common share using the two-class method. The following table reconciles earnings per common share for the three and six months ended August 4, 2023, and July 29, 2022: Three Months Ended Six Months Ended (In millions, except per share data) August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Basic earnings per common share: Net earnings $ 2,673 $ 2,992 $ 4,933 $ 5,325 Less: Net earnings allocable to participating securities (7) (9) (13) (17) Net earnings allocable to common shares, basic $ 2,666 $ 2,983 $ 4,920 $ 5,308 Weighted-average common shares outstanding 584 638 590 649 Basic earnings per common share $ 4.56 $ 4.68 $ 8.34 $ 8.18 Diluted earnings per common share: Net earnings $ 2,673 $ 2,992 $ 4,933 $ 5,325 Less: Net earnings allocable to participating securities (7) (9) (13) (17) Net earnings allocable to common shares, diluted $ 2,666 $ 2,983 $ 4,920 $ 5,308 Weighted-average common shares outstanding 584 638 590 649 Dilutive effect of non-participating share-based awards 1 1 1 2 Weighted-average common shares, as adjusted 585 639 591 651 Diluted earnings per common share $ 4.56 $ 4.67 $ 8.32 $ 8.16 Anti-dilutive securities excluded from diluted weighted-average common shares 0.5 1.3 0.5 0.5 |
Supplemental Disclosure
Supplemental Disclosure | 6 Months Ended |
Aug. 04, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Disclosure | Supplemental Disclosure Net interest expense is comprised of the following: Three Months Ended Six Months Ended (In millions) August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Long-term debt $ 368 $ 257 $ 711 $ 487 Short-term borrowings 1 — 15 1 Lease obligations 6 7 12 14 Interest income (35) (5) (51) (7) Interest capitalized (1) (1) (2) (2) Interest on tax uncertainties — — — 3 Other 2 6 4 11 Interest – net $ 341 $ 264 $ 689 $ 507 Supplemental disclosures of cash flow information: Six Months Ended (In millions) August 4, 2023 July 29, 2022 Cash paid for interest, net of amount capitalized $ 716 $ 436 Cash paid for income taxes – net 2,565 1,415 Non-cash investing and financing activities: Leased assets obtained in exchange for new finance lease liabilities $ 22 $ 32 Leased assets obtained in exchange for new operating lease liabilities 1 379 328 Cash dividends declared but not paid 641 666 1 Excludes $319 million of leases signed but not yet commenced as of August 4, 2023. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Pay vs Performance Disclosure | ||||
Net earnings | $ 2,673 | $ 2,992 | $ 4,933 | $ 5,325 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Aug. 04, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Aug. 04, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements (unaudited) and notes to the condensed consolidated financial statements (unaudited) are presented in accordance with the rules and regulations of the Securities and Exchange Commission and do not include all the disclosures normally required in annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). The condensed consolidated financial statements (unaudited), in the opinion of management, contain all normal recurring adjustments necessary to present fairly the consolidated balance sheets as of August 4, 2023, and July 29, 2022, and the statements of earnings, comprehensive income, and shareholders’ deficit for the three and six months ended August 4, 2023, and July 29, 2022, and cash flows for the six months ended August 4, 2023, and July 29, 2022. The February 3, 2023, consolidated balance sheet was derived from the audited financial statements. These interim condensed consolidated financial statements (unaudited) should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Lowe’s Companies, Inc. (the Company) Annual Report on Form 10-K for the fiscal year ended February 3, 2023 (the Annual Report). The financial results for the interim periods may not be indicative of the financial results for the entire fiscal year. |
Accounting Pronouncements Not Yet Adopted | Accounting Pronouncements Not Yet Adopted Recent accounting pronouncements pending adoption not discussed in this Form 10-Q or in the 2022 Form 10-K are either not applicable to the Company or are not expected to have a material impact on the Company. |
Revenue (Tables)
Revenue (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Sources of Revenue | The following table presents the Company’s sources of revenue: (In millions) Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Products $ 24,035 $ 26,477 $ 45,605 $ 49,360 Services 578 588 1,107 1,125 Other 343 411 592 650 Net sales $ 24,956 $ 27,476 $ 47,304 $ 51,135 |
Anticipated Sales Return And Right of Return Assets | The balances and classification within the consolidated balance sheets for anticipated sales returns and the associated right of return assets are as follows: (In millions) Classification August 4, July 29, February 3, Anticipated sales returns Other current liabilities $ 256 $ 302 $ 234 Right of return assets Other current assets 149 183 139 |
Schedule of Deferred Revenue | Deferred revenue for retail and stored-value cards are as follows: (In millions) August 4, July 29, February 3, Retail deferred revenue $ 1,006 $ 1,397 $ 933 Stored-value cards deferred revenue 560 571 670 Deferred revenue $ 1,566 $ 1,968 $ 1,603 Deferred revenue - Lowe’s protection plans The Company defers revenues for its separately-priced long-term extended protection plan contracts (Lowe’s protection plans) and recognizes revenue on a straight-line basis over the respective contract term. Expenses for claims are recognized in cost of sales when incurred. (In millions) August 4, July 29, February 3, Deferred revenue - Lowe’s protection plans $ 1,231 $ 1,169 $ 1,201 Three Months Ended Six Months Ended (In millions) August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Lowe’s protection plans deferred revenue recognized into sales $ 136 $ 129 $ 272 $ 256 Lowe’s protection plans claim expenses 54 48 107 93 |
Disaggregation of Revenues | The following table presents the Company’s net sales disaggregated by merchandise division: Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 (In millions) Net Sales % Net Sales % Net Sales % Net Sales % Home Décor 1 $ 8,725 35.0 % $ 9,521 34.7 % $ 16,962 35.9 % $ 18,209 35.6 % Hardlines 2 8,348 33.5 8,900 32.4 15,165 32.1 15,599 30.5 Building Products 3 7,245 29.0 8,347 30.4 14,032 29.7 16,116 31.5 Other 638 2.5 708 2.5 1,145 2.3 1,211 2.4 Total $ 24,956 100.0 % $ 27,476 100.0 % $ 47,304 100.0 % $ 51,135 100.0 % Note: Merchandise division net sales for the prior period have been reclassified to conform to the current period presentation. 1 Home Décor includes the following product categories: Appliances, Décor, Flooring, Kitchens & Bath, and Paint. 2 Hardlines includes the following product categories: Hardware, Lawn & Garden, Seasonal & Outdoor Living, and Tools. 3 Building Products includes the following product categories: Building Materials, Electrical, Lumber, Millwork, and Rough Plumbing. |
Net Sales Disaggregated by Geographical Area | The following table presents the Company’s net sales disaggregated by geographical area: (In millions) Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 United States $ 24,956 $ 25,817 $ 47,304 $ 48,243 Canada 1 — 1,659 — 2,892 Net Sales $ 24,956 $ 27,476 $ 47,304 $ 51,135 1 The Canadian retail business was sold on February 3, 2023. |
Restricted Investments (Tables)
Restricted Investments (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Restricted Investments | Short-term and long-term investments include restricted balances pledged as collateral primarily for the Lowe’s protection plans program and are as follows: (In millions) August 4, 2023 July 29, 2022 February 3, 2023 Short-term restricted investments $ 374 $ 450 $ 384 Long-term restricted investments 182 56 100 Total restricted investments $ 556 $ 506 $ 484 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements - Recurring Basis | The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis as of August 4, 2023, July 29, 2022, and February 3, 2023: Fair Value Measurements at (In millions) Classification Measurement Level August 4, July 29, February 3, Available-for-sale debt securities: U.S. Treasury securities Short-term investments Level 1 $ 138 $ 214 $ 157 Money market funds Short-term investments Level 1 85 119 43 Certificates of deposit Short-term investments Level 1 72 4 40 Corporate debt securities Short-term investments Level 2 62 54 78 Commercial paper Short-term investments Level 2 17 35 52 Foreign government debt securities Short-term investments Level 2 — 14 14 Municipal obligations Short-term investments Level 2 — 10 — U.S. Treasury securities Long-term investments Level 1 166 31 86 Corporate debt securities Long-term investments Level 2 14 23 12 Municipal obligations Long-term investments Level 2 2 2 2 Derivative instruments: Forward interest rate swaps Other current assets Level 2 $ — $ 216 $ 251 Fixed-to-floating interest rate swaps Other liabilities Level 2 92 56 88 Other financial instruments: Contingent consideration Long-term investments Level 3 $ — $ — $ 21 |
Rollforward of Contingent Consideration | The rollforward of the fair value of contingent consideration for the three and six months ended August 4, 2023, is as follows: Three Months Ended Six Months Ended (In millions) August 4, 2023 August 4, 2023 Beginning balance $ — $ 21 Change in fair value — 102 Proceeds received — (123) Ending balance $ — $ — |
Fair Value of Financial Instruments | Carrying amounts and the related estimated fair value of the Company’s long-term debt, excluding finance lease obligations, are as follows: August 4, 2023 July 29, 2022 February 3, 2023 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Carrying Amount Fair Value Unsecured notes (Level 1) $ 35,881 $ 31,898 $ 28,237 $ 26,586 $ 32,897 $ 30,190 Mortgage notes (Level 2) 2 2 4 5 2 2 Long-term debt (excluding finance lease obligations) $ 35,883 $ 31,900 $ 28,241 $ 26,591 $ 32,899 $ 30,192 |
Accounts Payable (Tables)
Accounts Payable (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Payables and Accruals [Abstract] | |
Schedule of Outstanding Financed Payment Obligations | The Company’s outstanding payment obligations that suppliers financed to participating financial institutions, which are included in accounts payable on the consolidated balance sheets, are as follows: (In millions) August 4, 2023 July 29, 2022 February 3, 2023 Financed payment obligations $ 1,475 $ 2,320 $ 2,257 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | On March 30, 2023, the Company issued $3.0 billion of unsecured fixed rate notes (March 2023 Notes) as follows: Principal Amount Maturity Date Interest Rate Discount $ 1,000 April 2026 4.800% $ 3 $ 1,000 July 2033 5.150% $ 4 $ 500 July 2053 5.750% $ 5 $ 500 April 2063 5.850% $ 5 |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Notional Amount of Derivative Instruments | The notional amounts for the Company’s material derivative instruments are as follows: (In millions) August 4, July 29, February 3, Cash flow hedges: Forward interest rate swap agreement notional amounts $ — $ 2,065 $ 1,290 Fair value hedges: Fixed-to-floating interest rate swap agreement notional amounts $ 850 $ 850 $ 850 |
Summary of Gain (Loss) on Interest Rate Swap Derivatives | The (loss)/gain from forward interest rate swap agreements, both settled and outstanding, designated as cash flow hedges recorded in other comprehensive income/(loss) and net earnings for the three and six months ended August 4, 2023, and July 29, 2022, including its line item in the financial statements, is as follows: (In millions) Three Months Ended Six Months Ended August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Other comprehensive income/(loss): Cash flow hedges – net of tax benefit/(expense) of $1 million, $12 million, $3 million, and ($61) million, respectively $ (3) $ (34) $ (6) $ 184 Net earnings: Interest – net $ 4 $ — $ 7 $ (1) |
Shareholders' Deficit (Tables)
Shareholders' Deficit (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Stockholders' Equity Note [Abstract] | |
Accelerated Share Repurchases | The terms of the ASR agreements entered into during the six months ended August 4, 2023, are as follows (in millions): Agreement Execution Agreement Settlement ASR Initial Shares Delivered at Inception Additional Shares Delivered at Settlement Total Shares Delivered Q1 2023 Q1 2023 $ 750 3.1 0.7 3.8 Q2 2023 Q2 2023 1,000 3.9 0.7 4.6 |
Repurchase of Common Stock Through the Open Market | In addition, the Company repurchased shares of its common stock through the open market as follows: Three Months Ended Six Months Ended August 4, 2023 August 4, 2023 (In millions) Shares Cost Shares Cost Open market share repurchases 5.5 $ 1,182 11.6 $ 2,450 |
Schedule of Share Repurchases | Total shares repurchased for the three and six months ended August 4, 2023, and July 29, 2022, were as follows: Three Months Ended August 4, 2023 July 29, 2022 (In millions) Shares Cost Shares Cost Share repurchase program 1 10.1 $ 2,182 21.5 $ 4,000 Shares withheld from employees — 3 0.1 2 Total share repurchases 10.1 $ 2,185 21.6 $ 4,002 Six Months Ended August 4, 2023 July 29, 2022 (In millions) Shares Cost Shares Cost Share repurchase program 1 20.0 $ 4,200 40.1 $ 8,000 Shares withheld from employees 0.7 133 0.6 119 Total share repurchases 20.7 $ 4,333 40.7 $ 8,119 1 Beginning January 1, 2023, share repurchases in excess of issuances are subject to a 1% excise tax, which is included as part of the cost basis of the shares acquired. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table reconciles earnings per common share for the three and six months ended August 4, 2023, and July 29, 2022: Three Months Ended Six Months Ended (In millions, except per share data) August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Basic earnings per common share: Net earnings $ 2,673 $ 2,992 $ 4,933 $ 5,325 Less: Net earnings allocable to participating securities (7) (9) (13) (17) Net earnings allocable to common shares, basic $ 2,666 $ 2,983 $ 4,920 $ 5,308 Weighted-average common shares outstanding 584 638 590 649 Basic earnings per common share $ 4.56 $ 4.68 $ 8.34 $ 8.18 Diluted earnings per common share: Net earnings $ 2,673 $ 2,992 $ 4,933 $ 5,325 Less: Net earnings allocable to participating securities (7) (9) (13) (17) Net earnings allocable to common shares, diluted $ 2,666 $ 2,983 $ 4,920 $ 5,308 Weighted-average common shares outstanding 584 638 590 649 Dilutive effect of non-participating share-based awards 1 1 1 2 Weighted-average common shares, as adjusted 585 639 591 651 Diluted earnings per common share $ 4.56 $ 4.67 $ 8.32 $ 8.16 Anti-dilutive securities excluded from diluted weighted-average common shares 0.5 1.3 0.5 0.5 |
Supplemental Disclosure (Tables
Supplemental Disclosure (Tables) | 6 Months Ended |
Aug. 04, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Net Interest Expense | Net interest expense is comprised of the following: Three Months Ended Six Months Ended (In millions) August 4, 2023 July 29, 2022 August 4, 2023 July 29, 2022 Long-term debt $ 368 $ 257 $ 711 $ 487 Short-term borrowings 1 — 15 1 Lease obligations 6 7 12 14 Interest income (35) (5) (51) (7) Interest capitalized (1) (1) (2) (2) Interest on tax uncertainties — — — 3 Other 2 6 4 11 Interest – net $ 341 $ 264 $ 689 $ 507 |
Supplemental Disclosures of Cash Flow Information | Supplemental disclosures of cash flow information: Six Months Ended (In millions) August 4, 2023 July 29, 2022 Cash paid for interest, net of amount capitalized $ 716 $ 436 Cash paid for income taxes – net 2,565 1,415 Non-cash investing and financing activities: Leased assets obtained in exchange for new finance lease liabilities $ 22 $ 32 Leased assets obtained in exchange for new operating lease liabilities 1 379 328 Cash dividends declared but not paid 641 666 1 Excludes $319 million of leases signed but not yet commenced as of August 4, 2023. |
Revenue - Sources of Revenue (D
Revenue - Sources of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 24,956 | $ 27,476 | $ 47,304 | $ 51,135 |
Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 24,035 | 26,477 | 45,605 | 49,360 |
Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 578 | 588 | 1,107 | 1,125 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 343 | $ 411 | $ 592 | $ 650 |
Revenue - Anticipated Sales Ret
Revenue - Anticipated Sales Returns (Details) - USD ($) $ in Millions | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Revenue from Contract with Customer [Abstract] | |||
Anticipated sales returns | $ 256 | $ 234 | $ 302 |
Right of return assets | $ 149 | $ 139 | $ 183 |
Revenue - Deferred Revenue (Det
Revenue - Deferred Revenue (Details) - USD ($) $ in Millions | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Revenue from Contract with Customer [Abstract] | |||
Retail deferred revenue | $ 1,006 | $ 933 | $ 1,397 |
Stored-value cards deferred revenue | 560 | 670 | 571 |
Deferred revenue | $ 1,566 | $ 1,603 | $ 1,968 |
Revenue - Extended Protection P
Revenue - Extended Protection Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | Feb. 03, 2023 | |
Revenue from Contract with Customer [Abstract] | |||||
Deferred revenue – Lowe's protection plans | $ 1,231 | $ 1,169 | $ 1,231 | $ 1,169 | $ 1,201 |
Lowe’s protection plans deferred revenue recognized into sales | 136 | 129 | 272 | 256 | |
Lowe’s protection plans claim expenses | $ 54 | $ 48 | $ 107 | $ 93 |
Revenue - Disaggregation of Rev
Revenue - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 24,956 | $ 27,476 | $ 47,304 | $ 51,135 |
Net sales (in percent) | 100% | 100% | 100% | 100% |
United States | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 24,956 | $ 25,817 | $ 47,304 | $ 48,243 |
Canada | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | 0 | 1,659 | 0 | 2,892 |
Home Decor | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 8,725 | $ 9,521 | $ 16,962 | $ 18,209 |
Net sales (in percent) | 35% | 34.70% | 35.90% | 35.60% |
Hardlines | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 8,348 | $ 8,900 | $ 15,165 | $ 15,599 |
Net sales (in percent) | 33.50% | 32.40% | 32.10% | 30.50% |
Building Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 7,245 | $ 8,347 | $ 14,032 | $ 16,116 |
Net sales (in percent) | 29% | 30.40% | 29.70% | 31.50% |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Net sales | $ 638 | $ 708 | $ 1,145 | $ 1,211 |
Net sales (in percent) | 2.50% | 2.50% | 2.30% | 2.40% |
Restricted Investments - Restri
Restricted Investments - Restricted Investment Balances (Details) - USD ($) $ in Millions | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Investments, Debt and Equity Securities [Abstract] | |||
Short-term restricted investments | $ 374 | $ 384 | $ 450 |
Long-term restricted investments | 182 | 100 | 56 |
Total restricted investments | $ 556 | $ 484 | $ 506 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Millions | Aug. 04, 2023 | May 05, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Other financial instruments: | ||||
Contingent consideration | $ 0 | $ 0 | $ 21 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Forward interest rate swaps | Fair Value (Level 2) | ||||
Assets, Fair Value Disclosure | ||||
Other current assets | 0 | 251 | $ 216 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Fixed-to-floating interest rate swaps | Fair Value (Level 2) | ||||
Liabilities, Fair Value Disclosure | ||||
Other liabilities | 92 | 88 | 56 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Short-term Investments | U.S. Treasury securities | Fair Value (Level 1) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 138 | 157 | 214 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Short-term Investments | Money market funds | Fair Value (Level 1) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 85 | 43 | 119 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Short-term Investments | Certificates of deposit | Fair Value (Level 1) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 72 | 40 | 4 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Short-term Investments | Corporate debt securities | Fair Value (Level 2) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 62 | 78 | 54 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Short-term Investments | Commercial paper | Fair Value (Level 2) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 17 | 52 | 35 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Short-term Investments | Foreign government debt securities | Fair Value (Level 2) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 0 | 14 | 14 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Short-term Investments | Municipal obligations | Fair Value (Level 2) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 0 | 0 | 10 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Long-term Investments | Fair Value (Level 3) | ||||
Other financial instruments: | ||||
Contingent consideration | 0 | 21 | 0 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Long-term Investments | U.S. Treasury securities | Fair Value (Level 1) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 166 | 86 | 31 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Long-term Investments | Corporate debt securities | Fair Value (Level 2) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | 14 | 12 | 23 | |
Fair Value, Measurements, Recurring | Estimate of Fair Value | Long-term Investments | Municipal obligations | Fair Value (Level 2) | ||||
Assets, Fair Value Disclosure | ||||
Available-for-sale debt securities | $ 2 | $ 2 | $ 2 |
Fair Value Measurements - Conti
Fair Value Measurements - Contingent Consideration (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Aug. 04, 2023 | Aug. 04, 2023 | |
Business Combination, Contingent Consideration [Roll Forward] | ||
Beginning balance | $ 0 | $ 21 |
Change in fair value | 0 | 102 |
Proceeds received | 0 | (123) |
Ending balance | $ 0 | $ 0 |
Fair Value Measurements - Other
Fair Value Measurements - Other Fair Value Disclosures (Details) - USD ($) $ in Millions | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Estimate of Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt fair value (excluding finance lease obligations) | $ 31,900 | $ 30,192 | $ 26,591 |
Estimate of Fair Value | Unsecured Notes | Fair Value (Level 1) | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt fair value (excluding finance lease obligations) | 31,898 | 30,190 | 26,586 |
Estimate of Fair Value | Mortgage Notes | Fair Value (Level 2) | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt fair value (excluding finance lease obligations) | 2 | 2 | 5 |
Long-term debt carrying value (excluding finance lease obligations) | 35,883 | 32,899 | 28,241 |
Unsecured Notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt carrying value (excluding finance lease obligations) | 35,881 | 32,897 | 28,237 |
Mortgage Notes | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt carrying value (excluding finance lease obligations) | $ 2 | $ 2 | $ 4 |
Accounts Payable - Outstanding
Accounts Payable - Outstanding Payment Obligations (Details) - USD ($) $ in Millions | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 |
Payables and Accruals [Abstract] | |||
Financed payment obligations | $ 1,475 | $ 2,257 | $ 2,320 |
Debt - Short-term Debt (Details
Debt - Short-term Debt (Details) - USD ($) | 1 Months Ended | ||||
Dec. 31, 2021 | Mar. 31, 2020 | Aug. 04, 2023 | Feb. 03, 2023 | Jul. 29, 2022 | |
Short-term Debt [Line Items] | |||||
Amount outstanding under the commercial paper program | $ 499,000,000 | ||||
Commercial paper | |||||
Short-term Debt [Line Items] | |||||
Weighted average interest rate | 4.78% | ||||
2020 Credit Agreement | |||||
Short-term Debt [Line Items] | |||||
Amount outstanding under the credit facility | $ 0 | $ 0 | $ 0 | ||
Third Amended And Restated Credit Agreement | |||||
Short-term Debt [Line Items] | |||||
Amount outstanding under the credit facility | 0 | $ 0 | $ 0 | ||
Revolving Credit Facility | |||||
Short-term Debt [Line Items] | |||||
Maximum borrowing capacity | $ 4,000,000,000 | ||||
Revolving Credit Facility | 2020 Credit Agreement | |||||
Short-term Debt [Line Items] | |||||
Maximum borrowing capacity | $ 2,000,000,000 | ||||
Debt instrument term | 5 years | ||||
Revolving Credit Facility | Third Amended And Restated Credit Agreement | |||||
Short-term Debt [Line Items] | |||||
Maximum borrowing capacity | $ 2,000,000,000 | ||||
Debt instrument term | 5 years |
Debt - Debt Issued (Details)
Debt - Debt Issued (Details) | Mar. 30, 2023 USD ($) |
Unsecured Notes Issued In 2023 | Unsecured Notes | |
Debt Instrument [Line Items] | |
Principal Amount (in millions) | $ 3,000,000,000 |
Unsecured Notes, 4.800% | |
Debt Instrument [Line Items] | |
Principal Amount (in millions) | $ 1,000,000,000 |
Interest Rate | 4.80% |
Discount (in millions) | $ 3,000,000 |
Unsecured Notes, 5.150% | |
Debt Instrument [Line Items] | |
Principal Amount (in millions) | $ 1,000,000,000 |
Interest Rate | 5.15% |
Discount (in millions) | $ 4,000,000 |
Unsecured Notes, 5.750% | |
Debt Instrument [Line Items] | |
Principal Amount (in millions) | $ 500,000,000 |
Interest Rate | 5.75% |
Discount (in millions) | $ 5,000,000 |
Unsecured Notes, 5.850% | |
Debt Instrument [Line Items] | |
Principal Amount (in millions) | $ 500,000,000 |
Interest Rate | 5.85% |
Discount (in millions) | $ 5,000,000 |
Debt - Long-Term Debt (Details)
Debt - Long-Term Debt (Details) | 6 Months Ended |
Aug. 04, 2023 | |
Unsecured Notes Issued In 2023 | |
Debt Instrument [Line Items] | |
Debt instrument, redemption price, percentage | 101% |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Mar. 30, 2023 | Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | Feb. 03, 2023 | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Cash flow hedges – net of tax | $ (3) | $ (38) | $ (6) | $ 181 | ||
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Interest Revenue (Expense), Net | Interest Revenue (Expense), Net | Interest Revenue (Expense), Net | Interest Revenue (Expense), Net | ||
Forward interest rate swaps | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Cash flow hedges - tax benefit/(expense) | $ 1 | $ 12 | $ 3 | $ (61) | ||
Forward interest rate swaps | Designated as Hedging Instrument | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 2,000 | |||||
Proceeds from derivative instrument | $ 247 | |||||
Cash flow hedges – net of tax | (3) | (34) | (6) | 184 | ||
Interest – net | 4 | 0 | 7 | (1) | ||
Forward interest rate swaps | Designated as Hedging Instrument | Cash Flow Hedging | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | 0 | 2,065 | 0 | 2,065 | $ 1,290 | |
Fixed-to-floating interest rate swaps | Designated as Hedging Instrument | Fair Value Hedging | ||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||||||
Notional amount of derivatives | $ 850 | $ 850 | $ 850 | $ 850 | $ 850 |
Shareholders' Deficit -Share Re
Shareholders' Deficit -Share Repurchases (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Aug. 04, 2023 | May 05, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Share repurchase program | |||||
Share Repurchases | |||||
Remaining share repurchases authorization, value | $ 16,600 | $ 16,600 | |||
Share repurchases, cost | 2,182 | $ 4,000 | 4,200 | $ 8,000 | |
Accelerated Share Repurchase | |||||
Share Repurchases | |||||
ASR Agreement Amount | $ 1,000 | $ 750 | $ 1,000 | ||
Initial Shares Delivered at Inception (in shares) | 3.9 | 3.1 | |||
Additional Shares Delivered At Settlement (in shares) | 0.7 | 0.7 | |||
Total Shares Delivered (in shares) | 4.6 | 3.8 | |||
Share repurchases (in shares) | 8.4 | ||||
Share repurchases, cost | $ 1,800 | ||||
Open Market Purchases | |||||
Share Repurchases | |||||
Share repurchases (in shares) | 5.5 | 11.6 | |||
Share repurchases, cost | $ 1,182 | $ 2,450 |
Shareholders' Deficit - Summary
Shareholders' Deficit - Summary (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Total share repurchases | ||||
Share Repurchases | ||||
Share repurchases (in shares) | 10.1 | 21.6 | 20.7 | 40.7 |
Share repurchases, cost | $ 2,185 | $ 4,002 | $ 4,333 | $ 8,119 |
Share repurchase program | ||||
Share Repurchases | ||||
Share repurchases (in shares) | 10.1 | 21.5 | 20 | 40.1 |
Share repurchases, cost | $ 2,182 | $ 4,000 | $ 4,200 | $ 8,000 |
Shares withheld from employees | ||||
Share Repurchases | ||||
Share repurchases (in shares) | 0 | 0.1 | 0.7 | 0.6 |
Share repurchases, cost | $ 3 | $ 2 | $ 133 | $ 119 |
Earnings Per Share - Summary (D
Earnings Per Share - Summary (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Basic earnings per common share: | ||||
Net earnings | $ 2,673 | $ 2,992 | $ 4,933 | $ 5,325 |
Less: Net earnings allocable to participating securities | (7) | (9) | (13) | (17) |
Net earnings allocable to common shares, basic | $ 2,666 | $ 2,983 | $ 4,920 | $ 5,308 |
Weighted-average common shares outstanding (in shares) | 584 | 638 | 590 | 649 |
Basic earnings per common share (in dollars per share) | $ 4.56 | $ 4.68 | $ 8.34 | $ 8.18 |
Diluted earnings per common share: | ||||
Net earnings | $ 2,673 | $ 2,992 | $ 4,933 | $ 5,325 |
Less: Net earnings allocable to participating securities | (7) | (9) | (13) | (17) |
Net earnings allocable to common shares, diluted | $ 2,666 | $ 2,983 | $ 4,920 | $ 5,308 |
Weighted-average common shares outstanding (in shares) | 584 | 638 | 590 | 649 |
Dilutive effect of non-participating share-based awards (in shares) | 1 | 1 | 1 | 2 |
Weighted-average common shares, as adjusted (in shares) | 585 | 639 | 591 | 651 |
Diluted earnings per common share (in dollars per share) | $ 4.56 | $ 4.67 | $ 8.32 | $ 8.16 |
Anti-dilutive securities excluded from diluted weighted-average common shares (in shares) | 0.5 | 1.3 | 0.5 | 0.5 |
Supplemental Disclosure - Net I
Supplemental Disclosure - Net Interest Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Aug. 04, 2023 | Jul. 29, 2022 | Aug. 04, 2023 | Jul. 29, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Long-term debt | $ 368 | $ 257 | $ 711 | $ 487 |
Short-term borrowings | 1 | 0 | 15 | 1 |
Lease obligations | 6 | 7 | 12 | 14 |
Interest income | (35) | (5) | (51) | (7) |
Interest capitalized | (1) | (1) | (2) | (2) |
Interest on tax uncertainties | 0 | 0 | 0 | 3 |
Other | 2 | 6 | 4 | 11 |
Interest – net | $ 341 | $ 264 | $ 689 | $ 507 |
Supplemental Disclosure - Cash
Supplemental Disclosure - Cash Flow Information (Details) - USD ($) $ in Millions | 6 Months Ended | |
Aug. 04, 2023 | Jul. 29, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Cash paid for interest, net of amount capitalized | $ 716 | $ 436 |
Cash paid for income taxes – net | 2,565 | 1,415 |
Non-cash investing and financing activities: | ||
Leased assets obtained in exchange for new finance lease liabilities | 22 | 32 |
Leased assets obtained in exchange for new operating lease liabilities | 379 | 328 |
Cash dividends declared but not paid | 641 | $ 666 |
Operating leases signed but not commenced | $ 319 |