Williams-Sonoma (WSM) 10-Q 2 Jun 17 2017 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Apr. 30, 2017	May 28, 2017
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Apr. 30, 2017
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q1
Trading Symbol	WSM
Entity Registrant Name	WILLIAMS SONOMA INC
Entity Central Index Key	719,955
Current Fiscal Year End Date	--01-29
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		86,636,793

Condensed Consolidated Statemen

Condensed Consolidated Statements of Earnings - USD ($) shares in Thousands, $ in Thousands		3 Months Ended
		Apr. 30, 2017	May 01, 2016
Net revenues	[1]	$ 1,111,507	$ 1,097,817
Cost of goods sold		715,747	705,300
Gross profit		395,760	392,517
Selling, general and administrative expenses		333,286	328,992
Operating income	[2]	62,474	63,525
Interest (income) expense, net		(103)	(68)
Earnings before income taxes		62,577	63,593
Income taxes		23,022	23,996
Net earnings		$ 39,555	$ 39,597
Basic earnings per share		$ 0.45	$ 0.44
Diluted earnings per share		$ 0.45	$ 0.44
Shares used in calculation of earnings per share:
Basic		86,962	89,298
Diluted		87,710	90,514
E-commerce
Net revenues		$ 580,510	$ 576,234
Retail
Net revenues		$ 530,997	$ 521,583
[1]	Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $69.4 million and $69.7 million for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively.
[2]	Includes $5.7 million and $13.2 million of severance-related charges for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively, primarily in our corporate functions, which is recorded in selling, general and administrative expenses within the unallocated segment.

Condensed Consolidated Stateme3

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands		3 Months Ended
		Apr. 30, 2017	May 01, 2016
Net earnings		$ 39,555	$ 39,597
Other comprehensive income (loss):
Foreign currency translation adjustments		(1,566)	5,208
Change in fair value of derivative financial instruments, net of tax (tax benefit) of $237 and $(768)		655	(2,165)
Reclassification adjustment for realized (gain) loss on derivative financial instruments, net of tax of $5 and $107	[1]	(16)	(302)
Comprehensive income		$ 38,628	$ 42,338
[1]	Refer to Note H for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Condensed Consolidated Statements of Earnings.

Condensed Consolidated Stateme4

Condensed Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Change in fair value of derivative financial instruments, tax	$ 237	$ (768)
Reclassification adjustment for realized losses on derivative financial instruments, tax	$ 5	$ 107

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Apr. 30, 2017		Jan. 29, 2017	May 01, 2016
Current assets
Cash and cash equivalents	$ 93,975		$ 213,713	$ 99,217
Accounts receivable, net	63,982		88,803	75,364
Merchandise inventories, net	1,037,107		977,505	944,632
Prepaid catalog expenses	23,066		23,625	29,916
Prepaid expenses	62,014		52,882	53,689
Other assets	10,901		10,652	9,844
Total current assets	1,291,045		1,367,180	1,212,662
Property and equipment, net	920,531		923,283	893,640
Deferred income taxes, net	124,977		135,238	131,597
Other assets, net	54,624		51,178	52,469
Total assets	2,391,177	[1]	2,476,879	2,290,368	[1]
Current liabilities
Accounts payable	399,336		453,710	339,392
Accrued salaries, benefits and other liabilities	91,038		130,187	96,577
Customer deposits	289,852		294,276	275,116
Borrowings under revolving line of credit	45,000			100,000
Income taxes payable	37,792		23,245	7,764
Other liabilities	49,647		59,838	52,907
Total current liabilities	912,665		961,256	871,756
Deferred rent and lease incentives	195,201		196,188	188,715
Other long-term obligations	73,160		71,215	67,041
Total liabilities	1,181,026		1,228,659	1,127,512
Commitments and contingencies - See Note F
Stockholders' equity
Preferred stock: $.01 par value; 7,500 shares authorized; none issued
Common stock: $.01 par value; 253,125 shares authorized; 86,883, 87,325 and 89,350 shares issued and outstanding at April 30, 2017, January 29, 2017 and May 1, 2016, respectively	869		873	894
Additional paid-in capital	549,281		556,928	534,414
Retained earnings	671,758		701,702	636,986
Accumulated other comprehensive loss	(10,830)		(9,903)	(7,875)
Treasury stock, at cost: 13, 20 and 23 shares as of April 30, 2017, January 29, 2017 and May 1, 2016, respectively	(927)		(1,380)	(1,563)
Total stockholders' equity	1,210,151		1,248,220	1,162,856
Total liabilities and stockholders' equity	$ 2,391,177		$ 2,476,879	$ 2,290,368
[1]	Includes long-term assets related to our international operations of approximately $57.9 million and $64.4 million as of April 30, 2017 and May 1, 2016, respectively.

Condensed Consolidated Balance6

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Apr. 30, 2017	Jan. 29, 2017	May 01, 2016
Preferred stock, par value	$ 0.01	$ 0.01	$ 0.01
Preferred stock, shares authorized	7,500,000	7,500,000	7,500,000
Preferred stock, shares issued	0	0	0
Common stock, par value	$ 0.01	$ 0.01	$ 0.01
Common stock, shares authorized	253,125,000	253,125,000	253,125,000
Common stock, shares issued	86,883,000	87,325,000	89,350,000
Common stock, shares outstanding	86,883,000	87,325,000	89,350,000
Treasury stock, shares	13,000	20,000	23,000

Condensed Consolidated Stateme7

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Cash flows from operating activities:
Net earnings	$ 39,555	$ 39,597
Adjustments to reconcile net earnings to net cash provided by (used in) operating activities:
Depreciation and amortization	44,950	41,240
Loss on disposal/impairment of assets	519	880
Amortization of deferred lease incentives	(6,477)	(5,987)
Deferred income taxes	(3,848)	(5,796)
Tax benefit related to stock-based awards	13,742	20,087
Excess tax benefit related to stock-based awards		(3,824)
Stock-based compensation expense	9,817	15,732
Other	(76)	(418)
Changes in:
Accounts receivable	24,610	3,781
Merchandise inventories	(60,246)	37,424
Prepaid catalog expenses	559	(997)
Prepaid expenses and other assets	(12,472)	(7,683)
Accounts payable	(65,990)	(113,510)
Accrued salaries, benefits and other liabilities	(47,235)	(20,875)
Customer deposits	(4,154)	(22,465)
Deferred rent and lease incentives	5,806	9,439
Income taxes payable	14,564	(59,285)
Net cash used in operating activities	(46,376)	(72,660)
Cash flows from investing activities:
Purchases of property and equipment	(32,153)	(28,149)
Other	5	294
Net cash used in investing activities	(32,148)	(27,855)
Cash flows from financing activities:
Borrowings under revolving line of credit	45,000	100,000
Repurchases of common stock	(38,350)	(40,639)
Payment of dividends	(34,189)	(34,423)
Tax withholdings related to stock-based awards	(13,780)	(22,904)
Excess tax benefit related to stock-based awards		3,824
Proceeds related to stock-based awards		995
Other		(48)
Net cash provided by (used in) financing activities	(41,319)	6,805
Effect of exchange rates on cash and cash equivalents	105	(720)
Net decrease in cash and cash equivalents	(119,738)	(94,430)
Cash and cash equivalents at beginning of period	213,713	193,647
Cash and cash equivalents at end of period	$ 93,975	$ 99,217

FINANCIAL STATEMENTS - BASIS OF

FINANCIAL STATEMENTS - BASIS OF PRESENTATION	3 Months Ended
	Apr. 30, 2017
FINANCIAL STATEMENTS - BASIS OF PRESENTATION	NOTE A. FINANCIAL STATEMENTS - BASIS OF PRESENTATION These financial statements include Williams-Sonoma, Inc. and its wholly owned subsidiaries (“we,” “us” or “our”). The Condensed Consolidated Balance Sheets as of April 30, 2017 and May 1, 2016, the Condensed Consolidated Statements of Earnings, the Condensed Consolidated Statements of Comprehensive Income for the thirteen weeks then ended, and the Condensed Consolidated Statements of Cash Flows for the thirteen weeks then ended, have been prepared by us, without audit. In our opinion, the financial statements include all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at the balance sheet dates and the results of operations for the thirteen weeks then ended. Intercompany transactions and accounts have been eliminated. The balance sheet as of January 29, 2017, presented herein, has been derived from our audited Consolidated Balance Sheet included in our Annual Report on Form 10-K The results of operations for the thirteen weeks ended April 30, 2017 are not necessarily indicative of the operating results of the full year. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been omitted. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K New Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations 2016-10, Identifying Performance Obligations and Licensing 2014-09 In February 2016, the FASB issued ASU 2016-02, Leases right-of-use In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other than Inventory In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment,

BORROWING ARRANGEMENTS

BORROWING ARRANGEMENTS	3 Months Ended
	Apr. 30, 2017
BORROWING ARRANGEMENTS	NOTE B. BORROWING ARRANGEMENTS Credit Facility We have a $500,000,000 unsecured revolving line of credit (“credit facility”) that may be used to borrow revolving loans or request the issuance of letters of credit. We may, upon notice to the administrative agent, request existing or new lenders to increase the credit facility by up to $250,000,000, at such lenders’ option, to provide for a total of $750,000,000 of unsecured revolving credit. As of April 30, 2017, we were in compliance with our financial covenants under the credit facility and based on current projections, we expect to remain in compliance throughout the next 12 months. The credit facility matures on November 19, 2019, at which time all outstanding borrowings must be repaid and all outstanding letters of credit must be cash collateralized. We may elect interest rates calculated at (i) Bank of America’s prime rate (or, if greater, the average rate on overnight federal funds plus one-half Letter of Credit Facilities We have three unsecured letter of credit reimbursement facilities for a total of $70,000,000, each of which matures on August 26, 2017. The letter of credit facilities contain covenants that are consistent with our unsecured revolving line of credit. Interest on unreimbursed amounts under the letter of credit facilities accrues at the lender’s prime rate (or, if greater, the average rate on overnight federal funds plus one-half

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION	3 Months Ended
	Apr. 30, 2017
STOCK-BASED COMPENSATION	NOTE C. STOCK-BASED COMPENSATION Equity Award Programs Our Amended and Restated 2001 Long-Term Incentive Plan (the “Plan”) provides for grants of incentive stock options, nonqualified stock options, stock-settled stock appreciation rights (collectively, “option awards”), restricted stock awards, restricted stock units (including those that are performance-based), deferred stock awards (collectively, “stock awards”) and dividend equivalents up to an aggregate of 32,310,000 shares. As of April 30, 2017, there were approximately 8,278,000 shares available for future grant. Awards may be granted under the Plan to our officers, employees and non-employee Option Awards Annual grants of option awards are limited to 1,000,000 shares on a per person basis and have a maximum term of seven years. The exercise price of these option awards is not less than 100% of the closing price of our stock on the day prior to the grant date. Option awards granted to employees generally vest evenly over a period of four years for service-based awards. Certain option awards contain vesting acceleration clauses resulting from events including, but not limited to, retirement, merger or a similar corporate event. Stock Awards Annual grants of stock awards are limited to 1,000,000 shares on a per person basis and have a maximum term of seven years. Stock awards granted to employees generally vest evenly over a period of four years for service-based awards. Certain performance-based awards, which have variable payout conditions based on predetermined financial targets, vest three years from the date of grant. Certain stock awards and other agreements contain vesting acceleration clauses resulting from events including, but not limited to, retirement, merger or a similar corporate event. Stock awards granted to non-employee Non-employee non-employee Stock-Based Compensation Expense During the thirteen weeks ended April 30, 2017 and May 1, 2016, we recognized total stock-based compensation expense, as a component of selling, general and administrative expenses, of $9,817,000 and $15,732,000, respectively. Stock-Settled Stock Appreciation Rights A stock-settled stock appreciation right is an award that allows the recipient to receive common stock equal to the appreciation in the fair market value of our common stock between the grant date and the conversion date for the number of shares converted. The following table summarizes our stock-settled stock appreciation right activity during the thirteen weeks ended April 30, 2017: Shares Balance at January 29, 2017 (100% vested) 411,710 Granted — Converted into common stock (33,674 ) Cancelled — Balance at April 30, 2017 (100% vested) 378,036 Restricted Stock Units The following table summarizes our restricted stock unit activity during the thirteen weeks ended April 30, 2017: Shares Balance at January 29, 2017 2,232,486 Granted 79,904 Released (568,999 ) Cancelled (343,244 ) Balance at April 30, 2017 1,400,147 Vested plus expected to vest at April 30, 2017 974,175

EARNINGS PER SHARE

EARNINGS PER SHARE	3 Months Ended
	Apr. 30, 2017
EARNINGS PER SHARE	NOTE D. EARNINGS PER SHARE Basic earnings per share is computed as net earnings divided by the weighted average number of common shares outstanding for the period. Diluted earnings per share is computed as net earnings divided by the weighted average number of common shares outstanding and common stock equivalents for the period. Common stock equivalents consist of shares subject to stock-based awards with exercise prices less than or equal to the average market price of our common stock for the period, to the extent their inclusion would be dilutive. The following is a reconciliation of net earnings and the number of shares used in the basic and diluted earnings per share computations: In thousands, except per share amounts Net Earnings Weighted Average Shares Earnings Per Share Thirteen weeks ended April 30, 2017 Basic $ 39,555 86,962 $ 0.45 Effect of dilutive stock-based awards 748 Diluted $ 39,555 87,710 $ 0.45 Thirteen weeks ended May 1, 2016 Basic $ 39,597 89,298 $ 0.44 Effect of dilutive stock-based awards 1,216 Diluted $ 39,597 90,514 $ 0.44 Stock-based awards of 215,595 and 203,000 were excluded from the computation of diluted earnings per share for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively, as their inclusion would be anti-dilutive.

SEGMENT REPORTING

SEGMENT REPORTING	3 Months Ended
	Apr. 30, 2017
SEGMENT REPORTING	NOTE E. SEGMENT REPORTING We have two reportable segments, e-commerce e-commerce e-commerce e-commerce e-commerce. These reportable segments are strategic business units that offer similar products for the home. They are managed separately because the business units utilize two distinct distribution and marketing strategies. Based on management’s best estimate, our operating segments include allocations of certain expenses, including advertising and employment costs, to the extent they have been determined to benefit both channels. These operating segments are aggregated at the channel level for reporting purposes due to the fact that our brands are interdependent for economies of scale and we do not maintain fully allocated income statements at the brand level. As a result, material financial decisions related to the brands are made at the channel level. Furthermore, it is not practicable for us to report revenue by product group. We use operating income to evaluate segment profitability. Operating income is defined as earnings (loss) before net interest income (expense) and income taxes. Unallocated costs before interest and income taxes include corporate employee-related costs, occupancy expenses (including depreciation expense), administrative costs and third-party service costs, primarily in our corporate administrative and systems departments. Unallocated assets include corporate cash and cash equivalents, prepaid expenses, the net book value of corporate facilities and related information systems, deferred income taxes and other corporate long-lived assets. Income taxes are calculated at an entity level and are not allocated to our reportable segments. Segment Information In thousands E-commerce Retail Unallocated Total Thirteen weeks ended April 30, 2017 Net revenues 1 $ 580,510 $ 530,997 $ — $ 1,111,507 Depreciation and amortization expense 6,967 22,342 15,641 44,950 Operating income (loss) 2 132,004 21,714 (91,244 ) 62,474 Assets 3 653,898 1,067,169 670,110 2,391,177 Capital expenditures 2,870 16,497 12,786 32,153 Thirteen weeks ended May 1, 2016 Net revenues 1 $ 576,234 $ 521,583 $ — $ 1,097,817 Depreciation and amortization expense 7,614 20,749 12,877 41,240 Operating income (loss) 2 131,545 30,125 (98,145 ) 63,525 Assets 3 600,053 1,039,580 650,735 2,290,368 Capital expenditures 3,849 13,752 10,548 28,149 1 Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $69.4 million and $69.7 million for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively. 2 Includes $5.7 million and $13.2 million of severance-related charges for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively, primarily in our corporate functions, which is recorded in selling, general and administrative expenses within the unallocated segment. 3 Includes long-term assets related to our international operations of approximately $57.9 million and $64.4 million as of April 30, 2017 and May 1, 2016, respectively.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Apr. 30, 2017
COMMITMENTS AND CONTINGENCIES	NOTE F. COMMITMENTS AND CONTINGENCIES We are involved in lawsuits, claims and proceedings incident to the ordinary course of our business. These disputes, which are not currently material, are increasing in number as our business expands and our company grows. We review the need for any loss contingency reserves and establish reserves when, in the opinion of management, it is probable that a matter would result in liability, and the amount of loss, if any, can be reasonably estimated. In view of the inherent difficulty of predicting the outcome of these matters, it may not be possible to determine whether any loss is probable or to reasonably estimate the amount of the loss until the case is close to resolution, in which case no reserve is established until that time. Any claims against us, whether meritorious or not, could result in costly litigation, require significant amounts of management time and result in the diversion of significant operational resources. The results of these lawsuits, claims and proceedings cannot be predicted with certainty. However, we believe that the ultimate resolution of these current matters will not have a material adverse effect on our Consolidated Financial Statements taken as a whole.

STOCK REPURCHASE PROGRAM AND DI

STOCK REPURCHASE PROGRAM AND DIVIDENDS	3 Months Ended
	Apr. 30, 2017
STOCK REPURCHASE PROGRAM AND DIVIDENDS	NOTE G. STOCK REPURCHASE PROGRAM AND DIVIDENDS Stock Repurchase Program During the thirteen weeks ended April 30, 2017, we repurchased 764,543 shares of our common stock at an average cost of $50.16 per share for a total cost of approximately $38,350,000 under our $500,000,000 stock repurchase authorization. As of April 30, 2017, we held treasury stock of $927,000 that represents the cost of shares available for issuance intended to satisfy future stock-based award settlements in certain foreign jurisdictions. During the thirteen weeks ended May 1, 2016, we repurchased 727,629 shares of our common stock at an average cost of $55.85 per share for a total cost of approximately $40,639,000. As of May 1, 2016, we held treasury stock of $1,563,000. Stock repurchases under our program may be made through open market and privately negotiated transactions at times and in such amounts as management deems appropriate. The timing and actual number of shares repurchased will depend on a variety of factors including price, corporate and regulatory requirements, capital availability and other market conditions. The stock repurchase program does not have an expiration date and may be limited or terminated at any time without prior notice. Dividends We declared cash dividends of $0.39 and $0.37 per common share during the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively. Our quarterly cash dividend may be limited or terminated at any time.

DERIVATIVE FINANCIAL INSTRUMENT

DERIVATIVE FINANCIAL INSTRUMENTS	3 Months Ended
	Apr. 30, 2017
DERIVATIVE FINANCIAL INSTRUMENTS	NOTE H. DERIVATIVE FINANCIAL INSTRUMENTS We have retail and/or e-commerce Derivatives and Hedging Cash Flow Hedges We enter into foreign currency forward contracts designated as cash flow hedges (to sell Canadian dollars and purchase U.S. dollars) for forecasted inventory purchases in U.S. dollars by our foreign subsidiaries. These hedges have terms of up to 18 months. All hedging relationships are formally documented, and the forward contracts are designed to mitigate foreign currency exchange risk on hedged transactions. We record the effective portion of changes in the fair value of our cash flow hedges in other comprehensive income (“OCI”) until the earlier of when the hedged forecasted inventory purchase occurs or the respective contract reaches maturity. Subsequently, as the inventory is sold to the customer, we reclassify amounts previously recorded in OCI to cost of goods sold. Changes in the fair value of the forward contract related to interest charges (or forward points) are excluded from the assessment and measurement of hedge effectiveness and are recorded immediately in selling, general and administrative expenses. Based on the rates in effect as of April 30, 2017, we expect to reclassify a net pre-tax We also enter into non-designated As of April 30, 2017 and May 1, 2016, we had foreign currency forward contracts outstanding (in U.S. dollars) with notional values as follows: In thousands April 30, 2017 May 1, 2016 Contracts designated as cash flow hedges $ 19,200 $ 27,150 Contracts not designated as cash flow hedges $ 48,000 $ 43,000 Hedge effectiveness is evaluated prospectively at inception, on an ongoing basis, as well as retrospectively using regression analysis. Any measureable ineffectiveness of the hedge is recorded in selling, general and administrative expenses. No gain or loss was recognized for cash flow hedges due to hedge ineffectiveness and all hedges were deemed effective for assessment purposes for the thirteen weeks ended April 30, 2017 and May 1, 2016. The effect of derivative instruments in our Condensed Consolidated Financial Statements during the thirteen weeks ended April 30, 2017 and May 1, 2016, pre-tax, In thousands April 30, 2017 May 1, 2016 Net gain (loss) recognized in OCI $ 892 $ (2,933 ) Net gain (loss) reclassified from OCI to cost of goods sold $ 21 $ 409 Net foreign exchange gain (loss) recognized in selling, general and administrative expenses: Instruments designated as cash flow hedges 1 $ 8 $ 23 Instruments not designated or de-designated $ 341 $ (3,342 ) 1 Changes in fair value of the forward contract related to interest charges (or forward points). The fair values of our derivative financial instruments are presented below according to their classification in our Condensed Consolidated Balance Sheets. All fair values were measured using Level 2 inputs as defined by the fair value hierarchy described in Note I. In thousands April 30, 2017 May 1, 2016 Derivatives designated as cash flow hedges: Other current assets $ 925 $ — Other long-term assets $ 52 $ — Other current liabilities $ — $ (2,160 ) Derivatives not designated as hedging instruments: Other current liabilities $ (83 ) $ (287 ) We record all derivative assets and liabilities on a gross basis. They do not meet the balance sheet netting criteria as discussed in ASC 210, Balance Sheet

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	3 Months Ended
	Apr. 30, 2017
FAIR VALUE MEASUREMENTS	NOTE I. FAIR VALUE MEASUREMENTS Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We determine the fair value of financial and non-financial Fair Value Measurement • Level 1: inputs which include quoted prices in active markets for identical assets or liabilities; • Level 2: inputs which include observable inputs other than Level 1 inputs, such as quoted prices in active markets for similar assets or liabilities; quoted prices for identical or similar assets or liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the asset or liability; and • Level 3: inputs which include unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the underlying asset or liability. The fair values of our cash and cash equivalents are based on Level 1 inputs, which include quoted prices in active markets for identical assets. Foreign Currency Derivatives and Hedging Instruments We use the income approach to value our derivatives using observable Level 2 market data at the measurement date and standard valuation techniques to convert future amounts to a single present value amount, assuming that participants are motivated but not compelled to transact. Level 2 inputs are limited to quoted prices that are observable for the assets and liabilities, which include interest rates and credit risk ratings. We use mid-market The counterparties associated with our foreign currency forward contracts are large credit-worthy financial institutions, and the derivatives transacted with these entities are relatively short in duration, therefore, we do not consider counterparty concentration and non-performance Property and Equipment We review the carrying value of all long-lived assets for impairment, primarily at an individual store level, whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. We measure these assets at fair value on a nonrecurring basis using Level 3 inputs as defined in the fair value hierarchy. The fair value is based on the present value of estimated future cash flows using a discount rate that approximates our weighted average cost of capital. There were no transfers between Level 1, 2 or 3 categories during the thirteen weeks ended April 30, 2017 or May 1, 2016.

ACCUMULATED OTHER COMPREHENSIVE

ACCUMULATED OTHER COMPREHENSIVE INCOME	3 Months Ended
	Apr. 30, 2017
ACCUMULATED OTHER COMPREHENSIVE INCOME	NOTE J. ACCUMULATED OTHER COMPREHENSIVE INCOME Changes in accumulated other comprehensive income (loss) by component, net of tax, are as follows: In thousands Foreign Currency Translation Cash Flow Hedges Accumulated Other Comprehensive Income (Loss) Balance at January 29, 2017 $ (9,957 ) $ 54 $ (9,903 ) Foreign currency translation adjustments (1,566 ) — (1,566 ) Change in fair value of derivative financial instruments — 655 655 Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (16 ) (16 ) Other comprehensive income (loss) (1,566 ) 639 (927 ) Balance at April 30, 2017 (11,523 ) 693 (10,830 ) Balance at January 31, 2016 (11,480 ) 864 (10,616 ) Foreign currency translation adjustments 5,208 5,208 Change in fair value of derivative financial instruments — (2,165 ) (2,165 ) Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (302 ) (302 ) Other comprehensive income (loss) 5,208 (2,467 ) 2,741 Balance at May 1, 2016 $ (6,272 ) $ (1,603 ) $ (7,875 ) 1 Refer to Note H for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Condensed Consolidated Statements of Earnings.

FINANCIAL STATEMENTS - BASIS 18

FINANCIAL STATEMENTS - BASIS OF PRESENTATION (Policies)	3 Months Ended
	Apr. 30, 2017
New Accounting Pronouncements	New Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers 2016-08, Revenue from Contracts with Customers: Principal versus Agent Considerations 2016-10, Identifying Performance Obligations and Licensing 2014-09 In February 2016, the FASB issued ASU 2016-02, Leases right-of-use In March 2016, the FASB issued ASU 2016-09, Improvements to Employee Share-Based Payment Accounting In October 2016, the FASB issued ASU 2016-16, Intra-Entity Transfers of Assets Other than Inventory In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment,

STOCK-BASED COMPENSATION (Table

STOCK-BASED COMPENSATION (Tables)	3 Months Ended
	Apr. 30, 2017
Summary of Stock-Settled Stock Appreciation Rights Activity	The following table summarizes our stock-settled stock appreciation right activity during the thirteen weeks ended April 30, 2017: Shares Balance at January 29, 2017 (100% vested) 411,710 Granted — Converted into common stock (33,674 ) Cancelled — Balance at April 30, 2017 (100% vested) 378,036
Summary of Restricted Stock Units Activity	The following table summarizes our restricted stock unit activity during the thirteen weeks ended April 30, 2017: Shares Balance at January 29, 2017 2,232,486 Granted 79,904 Released (568,999 ) Cancelled (343,244 ) Balance at April 30, 2017 1,400,147 Vested plus expected to vest at April 30, 2017 974,175

EARNINGS PER SHARE (Tables)

EARNINGS PER SHARE (Tables)	3 Months Ended
	Apr. 30, 2017
Reconciliation of Net Earnings and Number of Shares Used In Basic and Diluted Earnings per Share Computations	The following is a reconciliation of net earnings and the number of shares used in the basic and diluted earnings per share computations: In thousands, except per share amounts Net Earnings Weighted Average Shares Earnings Per Share Thirteen weeks ended April 30, 2017 Basic $ 39,555 86,962 $ 0.45 Effect of dilutive stock-based awards 748 Diluted $ 39,555 87,710 $ 0.45 Thirteen weeks ended May 1, 2016 Basic $ 39,597 89,298 $ 0.44 Effect of dilutive stock-based awards 1,216 Diluted $ 39,597 90,514 $ 0.44

SEGMENT REPORTING (Tables)

SEGMENT REPORTING (Tables)	3 Months Ended
	Apr. 30, 2017
Segment Information	Segment Information In thousands E-commerce Retail Unallocated Total Thirteen weeks ended April 30, 2017 Net revenues 1 $ 580,510 $ 530,997 $ — $ 1,111,507 Depreciation and amortization expense 6,967 22,342 15,641 44,950 Operating income (loss) 2 132,004 21,714 (91,244 ) 62,474 Assets 3 653,898 1,067,169 670,110 2,391,177 Capital expenditures 2,870 16,497 12,786 32,153 Thirteen weeks ended May 1, 2016 Net revenues 1 $ 576,234 $ 521,583 $ — $ 1,097,817 Depreciation and amortization expense 7,614 20,749 12,877 41,240 Operating income (loss) 2 131,545 30,125 (98,145 ) 63,525 Assets 3 600,053 1,039,580 650,735 2,290,368 Capital expenditures 3,849 13,752 10,548 28,149 1 Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $69.4 million and $69.7 million for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively. 2 Includes $5.7 million and $13.2 million of severance-related charges for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively, primarily in our corporate functions, which is recorded in selling, general and administrative expenses within the unallocated segment. 3 Includes long-term assets related to our international operations of approximately $57.9 million and $64.4 million as of April 30, 2017 and May 1, 2016, respectively.

DERIVATIVE FINANCIAL INSTRUME22

DERIVATIVE FINANCIAL INSTRUMENTS (Tables)	3 Months Ended
	Apr. 30, 2017
Foreign Currency Forward Contracts Outstanding with Notional Values	As of April 30, 2017 and May 1, 2016, we had foreign currency forward contracts outstanding (in U.S. dollars) with notional values as follows: In thousands April 30, 2017 May 1, 2016 Contracts designated as cash flow hedges $ 19,200 $ 27,150 Contracts not designated as cash flow hedges $ 48,000 $ 43,000
Effect of Derivative Instruments in Consolidated Financial Statements	The effect of derivative instruments in our Condensed Consolidated Financial Statements during the thirteen weeks ended April 30, 2017 and May 1, 2016, pre-tax, In thousands April 30, 2017 May 1, 2016 Net gain (loss) recognized in OCI $ 892 $ (2,933 ) Net gain (loss) reclassified from OCI to cost of goods sold $ 21 $ 409 Net foreign exchange gain (loss) recognized in selling, general and administrative expenses: Instruments designated as cash flow hedges 1 $ 8 $ 23 Instruments not designated or de-designated $ 341 $ (3,342 ) 1 Changes in fair value of the forward contract related to interest charges (or forward points).
Fair Values of Derivative Instruments	The fair values of our derivative financial instruments are presented below according to their classification in our Condensed Consolidated Balance Sheets. All fair values were measured using Level 2 inputs as defined by the fair value hierarchy described in Note I. In thousands April 30, 2017 May 1, 2016 Derivatives designated as cash flow hedges: Other current assets $ 925 $ — Other long-term assets $ 52 $ — Other current liabilities $ — $ (2,160 ) Derivatives not designated as hedging instruments: Other current liabilities $ (83 ) $ (287 )

ACCUMULATED OTHER COMPREHENSI23

ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables)	3 Months Ended
	Apr. 30, 2017
Changes in Accumulated Other Comprehensive Income (Loss) by Component, Net of Tax	Changes in accumulated other comprehensive income (loss) by component, net of tax, are as follows: In thousands Foreign Currency Translation Cash Flow Hedges Accumulated Other Comprehensive Income (Loss) Balance at January 29, 2017 $ (9,957 ) $ 54 $ (9,903 ) Foreign currency translation adjustments (1,566 ) — (1,566 ) Change in fair value of derivative financial instruments — 655 655 Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (16 ) (16 ) Other comprehensive income (loss) (1,566 ) 639 (927 ) Balance at April 30, 2017 (11,523 ) 693 (10,830 ) Balance at January 31, 2016 (11,480 ) 864 (10,616 ) Foreign currency translation adjustments 5,208 5,208 Change in fair value of derivative financial instruments — (2,165 ) (2,165 ) Reclassification adjustment for realized (gain) loss on derivative financial instruments 1 — (302 ) (302 ) Other comprehensive income (loss) 5,208 (2,467 ) 2,741 Balance at May 1, 2016 $ (6,272 ) $ (1,603 ) $ (7,875 ) 1 Refer to Note H for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Condensed Consolidated Statements of Earnings.

Financial Statements - Basis 24

Financial Statements - Basis of Presentation - Additional Information (Detail)	3 Months Ended
	Apr. 30, 2017USD ($)
Tax expense related to stock-based awards	$ 1,400,000

Borrowing Arrangements - Additi

Borrowing Arrangements - Additional Information (Detail) - USD ($)	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Debt Instrument [Line Items]
Additional percentage over reference rate	2.00%
Interest rate description	Interest on unreimbursed amounts under the letter of credit facilities accrues at the lender's prime rate (or, if greater, the average rate on overnight federal funds plus one-half of one percent) plus 2.0%.
Amount of borrowings under credit facility during period	$ 45,000,000	$ 100,000,000
Maximum borrowing capacity under letter of credit facilities including additional borrowing capacity	$ 70,000,000
Letter of credit facilities, maturity date	Aug. 26, 2017
Outstanding letter of credit facilities	$ 6,831,000
Latest expiration date possible for future letters of credit	Jan. 23, 2018
Standby Letters of Credit
Debt Instrument [Line Items]
Amount issued but undrawn under credit facility	$ 12,120,000
Federal Funds
Debt Instrument [Line Items]
Additional percentage over reference rate	0.50%
Unsecured Revolving Line Of Credit
Debt Instrument [Line Items]
Current borrowing capacity	$ 500,000,000
Maximum borrowing capacity including additional borrowing capacity	$ 750,000,000
Credit facility, maturity date	Nov. 19, 2019
Interest rate description	We may elect interest rates calculated at (i) Bank of America's prime rate (or, if greater, the average rate on overnight federal funds plus one-half of one percent, or a rate based on LIBOR plus one percent) plus a margin based on our leverage ratio or (ii) LIBOR plus a margin based on our leverage ratio.
Weighted average interest rate	2.01%	1.45%
Unsecured Revolving Line Of Credit | Maximum
Debt Instrument [Line Items]
Additional borrowing capacity	$ 250,000,000
Unsecured Revolving Line Of Credit | Federal Funds
Debt Instrument [Line Items]
Additional percentage over reference rate	0.50%
Unsecured Revolving Line Of Credit | Libor
Debt Instrument [Line Items]
Additional percentage over reference rate	1.00%

Stock Based Compensation - Addi

Stock Based Compensation - Additional Information (Detail) - USD ($) $ in Thousands	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum term of grants of option awards, years	7 years
Stock-based compensation expense	$ 9,817	$ 15,732
Minimum | Non-Employee
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of awards granted to employees, years	1 year
Equity Award Programs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate number of shares under the Plan	32,310,000
Shares available for future grant	8,278,000
Option Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards annual grant limit	1,000,000
Option Awards | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Exercise price as a percentage of closing price on the day prior to the grant date	100.00%
Service Based Option Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of awards granted to employees, years	4 years
Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Awards annual grant limit	1,000,000
Maximum term of grants of stock awards, years	7 years
Service Based Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of awards granted to employees, years	4 years
Performance Based Stock Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period of awards granted to employees, years	3 years

Summary of Stock-Settled Stock

Summary of Stock-Settled Stock Appreciation Right Activity (Detail) - Stock-Settled Stock Appreciation Rights	3 Months Ended
	Apr. 30, 2017shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Balance at January 29, 2017 (100% vested)	411,710
Granted, shares	0
Converted into common stock, shares	(33,674)
Cancelled, shares	0
Balance at April 30, 2017 (100% vested)	378,036

Summary of Stock-Settled Stoc28

Summary of Stock-Settled Stock Appreciation Right Activity (Parenthetical) (Detail)	3 Months Ended
	Apr. 30, 2017
Stock-Settled Stock Appreciation Rights
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vested percentage	100.00%

Summary of Restricted Stock Uni

Summary of Restricted Stock Unit Activity (Detail) - Restricted Stock Units (RSUs)	3 Months Ended
	Apr. 30, 2017shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Balance at January 29, 2017 shares	2,232,486
Granted, shares	79,904
Released, shares	(568,999)
Cancelled, shares	(343,244)
Balance at April 30, 2017 shares	1,400,147
Vested plus expected to vest at April 30, 2017 shares	974,175

Reconciliation of Net Earnings

Reconciliation of Net Earnings and Number of Shares Used in Basic and Diluted Earnings Per Share Computations (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Earnings Per Share [Line Items]
Net Earnings, Basic	$ 39,555	$ 39,597
Net Earnings, Diluted	$ 39,555	$ 39,597
Weighted Average Shares, Basic	86,962	89,298
Weighted Average Shares, Effect of dilutive stock-based awards	748	1,216
Weighted Average Shares, Diluted	87,710	90,514
Earnings Per Share, Basic	$ 0.45	$ 0.44
Earnings Per Share, Diluted	$ 0.45	$ 0.44

Earnings Per Share- Additional

Earnings Per Share- Additional Information (Detail) - shares	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Earnings Per Share [Line Items]
Anti-dilutive stock-based awards excluded from the computation of diluted earnings per share	215,595	203,000

Segment Reporting - Additional

Segment Reporting - Additional Information (Detail)	3 Months Ended
	Apr. 30, 2017Segment
Segment Reporting Information [Line Items]
Number of reportable segments	2

Segment Information (Detail)

Segment Information (Detail) - USD ($) $ in Thousands		3 Months Ended
		Apr. 30, 2017		May 01, 2016		Jan. 29, 2017
Segment Reporting Information [Line Items]
Net revenues	[1]	$ 1,111,507		$ 1,097,817
Depreciation and amortization expense		44,950		41,240
Operating income (loss)	[2]	62,474		63,525
Assets		2,391,177	[3]	2,290,368	[3]	$ 2,476,879
Capital expenditures		32,153		28,149
E-commerce
Segment Reporting Information [Line Items]
Net revenues		580,510		576,234
Retail
Segment Reporting Information [Line Items]
Net revenues		530,997		521,583
Operating Segments | E-commerce
Segment Reporting Information [Line Items]
Net revenues	[1]	580,510		576,234
Depreciation and amortization expense		6,967		7,614
Operating income (loss)	[2]	132,004		131,545
Assets	[3]	653,898		600,053
Capital expenditures		2,870		3,849
Operating Segments | Retail
Segment Reporting Information [Line Items]
Net revenues	[1]	530,997		521,583
Depreciation and amortization expense		22,342		20,749
Operating income (loss)	[2]	21,714		30,125
Assets	[3]	1,067,169		1,039,580
Capital expenditures		16,497		13,752
Unallocated
Segment Reporting Information [Line Items]
Depreciation and amortization expense		15,641		12,877
Operating income (loss)	[2]	(91,244)		(98,145)
Assets	[3]	670,110		650,735
Capital expenditures		$ 12,786		$ 10,548
[1]	Includes net revenues related to our international operations (including our operations in Canada, Australia, the United Kingdom and our franchise businesses) of approximately $69.4 million and $69.7 million for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively.
[2]	Includes $5.7 million and $13.2 million of severance-related charges for the thirteen weeks ended April 30, 2017 and May 1, 2016, respectively, primarily in our corporate functions, which is recorded in selling, general and administrative expenses within the unallocated segment.
[3]	Includes long-term assets related to our international operations of approximately $57.9 million and $64.4 million as of April 30, 2017 and May 1, 2016, respectively.

Segment Information (Parentheti

Segment Information (Parenthetical) (Detail) - USD ($) $ in Millions	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Segment Reporting Information [Line Items]
Net revenues related to foreign operations	$ 69.4	$ 69.7
Severance, related charges	5.7	13.2
Long-term assets related to foreign operations	$ 57.9	$ 64.4

Stock Repurchase Program and 35

Stock Repurchase Program and Dividends - Additional Information (Detail) - USD ($)	3 Months Ended
	Apr. 30, 2017	May 01, 2016	Jan. 29, 2017
Stock Repurchase Program and Dividend [Line Items]
Common stock repurchased, shares	764,543	727,629
Common stock repurchased, average cost per share	$ 50.16	$ 55.85
Common stock repurchased, total cost	$ 38,350,000	$ 40,639,000
Stock repurchase program, authorized shares	500,000,000
Treasure stock, value	$ 927,000	$ 1,563,000	$ 1,380,000
Cash dividend, per common share	$ 0.39	$ 0.37

Derivative Financial Instrume36

Derivative Financial Instruments - Additional Information (Detail) - USD ($)	3 Months Ended
	Apr. 30, 2017	May 01, 2016
Derivative [Line Items]
Reclassification from OCI to cost of goods sold	$ 944,000
Gain or loss recognized for cash flow hedges due to hedge ineffectiveness	$ 0	$ 0

Foreign Currency Forward Contra

Foreign Currency Forward Contracts Outstanding with Notional Values (Detail) - Foreign Exchange Contract - USD ($)	Apr. 30, 2017	May 01, 2016
Derivatives Designated as Hedging Instruments | Cash Flow Hedging
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Exchange of foreign currency contracts	$ 19,200,000	$ 27,150,000
Not Designated as Hedging Instrument
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Exchange of foreign currency contracts	$ 48,000,000	$ 43,000,000

Effect of Derivative Instrument

Effect of Derivative Instruments in Condensed Consolidated Financial Statements (Detail) - USD ($) $ in Thousands		3 Months Ended
		Apr. 30, 2017	May 01, 2016
Derivative [Line Items]
Net gain (loss) recognized in OCI		$ 892	$ (2,933)
Net gain (loss) reclassified from OCI to cost of goods sold		21	409
Net foreign exchange gain (loss) recognized in selling, general and administrative expenses, Instruments designated as cash flow hedges	[1]	8	23
Net foreign exchange gain (loss) recognized in selling, general and administrative expenses, Instruments not designated or de-designated		$ 341	$ (3,342)
[1]	Changes in fair value of the forward contract related to interest charges (or forward points).

Fair Value of Derivatives as De

Fair Value of Derivatives as Defined by Accounting Standard (Detail) - USD ($) $ in Thousands	Apr. 30, 2017	May 01, 2016
Other Current Assets
Derivatives, Fair Value [Line Items]
Derivatives designated as cash flow hedges, Assets	$ 925
Other Long-Term Assets
Derivatives, Fair Value [Line Items]
Derivatives designated as cash flow hedges, Assets	52
Other Current Liabilities
Derivatives, Fair Value [Line Items]
Derivatives designated as cash flow hedges, Liabilities		$ (2,160)
Derivatives not designated as hedging instruments, Liabilities	$ (83)	$ (287)

Changes in Accumulated Other Co

Changes in Accumulated Other Comprehensive Income (Loss) by Component, Net of Tax (Detail) - USD ($) $ in Thousands		3 Months Ended
		Apr. 30, 2017	May 01, 2016
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		$ (9,903)
Foreign currency translation adjustments		(1,566)	$ 5,208
Change in fair value of derivative financial instruments		655	(2,165)
Reclassification adjustment for realized (gain) loss on derivative financial instruments	[1]	(16)	(302)
Other comprehensive income (loss)		(927)	2,741
Ending Balance		(10,830)	(7,875)
Accumulated Foreign Currency Adjustment Attributable to Parent
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(9,957)	(11,480)
Foreign currency translation adjustments		(1,566)	5,208
Other comprehensive income (loss)		(1,566)	5,208
Ending Balance		(11,523)	(6,272)
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		54	864
Change in fair value of derivative financial instruments		655	(2,165)
Reclassification adjustment for realized (gain) loss on derivative financial instruments	[1]	(16)	(302)
Other comprehensive income (loss)		639	(2,467)
Ending Balance		693	(1,603)
Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(9,903)	(10,616)
Ending Balance		$ (10,830)	$ (7,875)
[1]	Refer to Note H for additional disclosures about reclassifications out of accumulated other comprehensive income and their corresponding effects on the respective line items in the Condensed Consolidated Statements of Earnings.