Nordstrom (JWN) 10-K 22 Mar 10 2010 FY Annual report Financial data

Document and Company Informatio

Document and Company Information (USD $)
In Billions, except Share data	12 Months Ended Jan. 30, 2010	Mar. 12, 2010	Jul. 31, 2009
Document and Company Information [Abstract]
Document Type	10-K
Document Period End Date	2010-01-30
Amendment Flag	false
Entity Registrant Name	NORDSTROM INC
Entity Central Index Key	0000072333
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Current Fiscal Year End Date	--01-30
Entity Filer Category	Large Accelerated Filer
Entity Well-known Seasoned Issuer	Yes
Entity Common Stock, Shares Outstanding		218,020,643
Entity Public Float			4.8

Consolidated Statements of Earn

Consolidated Statements of Earnings (USD $)
In Millions, except Per Share data	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009	12 Months Ended Feb. 02, 2008
Net sales	$8,258	$8,272	$8,828
Credit card revenues	369	301	252
Total revenues	8,627	8,573	9,080
Cost of sales and related buying and occupancy costs	(5,328)	(5,417)	(5,526)
Selling, general and administrative expenses:
Retail stores, direct and other segments	(2,109)	(2,103)	(2,161)
Credit segment	(356)	(274)	(198)
Gain on sale of Faconnable			34
Earnings on investment in asset-backed securities, net			18
Earnings before interest and income taxes	834	779	1,247
Interest expense, net	(138)	(131)	(74)
Earnings before income taxes	696	648	1,173
Income tax expense	(255)	(247)	(458)
Net earnings	$441	$401	$715
Earnings per basic share	2.03	1.85	2.92
Earnings per diluted share	2.01	1.83	2.88
Basic shares	216.8	216.6	244.8
Diluted shares	219.7	219.2	248.8

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Millions	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009
Current assets:
Cash and cash equivalents	$795	$72
Accounts receivable, net	2,035	1,942
Merchandise inventories	898	900
Current deferred tax assets, net	238	210
Prepaid expenses and other	88	93
Total current assets	4,054	3,217
Land, buildings and equipment, net	2,242	2,221
Goodwill	53	53
Other assets	230	170
Total assets	6,579	5,661
Current liabilities:
Commercial paper		275
Accounts payable	726	563
Accrued salaries, wages and related benefits	336	214
Other current liabilities	596	525
Current portion of long-term debt	356	24
Total current liabilities	2,014	1,601
Long-term debt, net	2,257	2,214
Deferred property incentives, net	469	435
Other liabilities	267	201
Commitments and contingencies
Shareholders' equity:
Common stock, no par value: 1,000 shares authorized; 217.7, and 215.4 shares issued and outstanding	1,066	997
Retained earnings	525	223
Accumulated other comprehensive loss	(19)	(10)
Total shareholders' equity	1,572	1,210
Total liabilities and shareholders' equity	$6,579	$5,661

1_Consolidated Balance Sheets

Consolidated Balance Sheets (Parenthetical)
Share data in Millions	Jan. 30, 2010	Jan. 31, 2009
Shareholders' equity:
Common stock, par value	$0	$0
Common stock, shares authorized	1,000	1,000
Common stock, shares issued	217.7	215.4
Common stock, shares outstanding	217.7	215.4

Consolidated Statements of Shar

Consolidated Statements of Shareholders Equity (USD $)
In Millions	Common Stock	Retained Earnings	Accumulated Other Comprehensive Earnings (Loss)	Total
Beginning balance, Shares at Feb. 03, 2007	257.3
Beginning balance at Feb. 03, 2007	$827	$1,351	($9)	$2,169
Cumulative effect of accounting change		(3)		(3)
Adjusted Beginning Balance at February 3, 2007	827	1,348	(9)	2,166
Adjusted Beginning Balance at February 3, 2007, Shares	257.3
Shareholders' Equity Rollforward
Net earnings		715		715
Other comprehensive earnings (loss):
Foreign currency translation adjustment			(15)	(15)
Postretirement plan adjustments, net of tax			7	7
Fair value adjustment to investment in asset-backed securities, net of tax of $3			(5)	(5)
Comprehensive net earnings				702
Cash dividends paid ($0.64 per share in 2009 and 2008; $0.54 per share in 2007)		(134)		(134)
Issuance of common stock for:
Stock option plans	61			61
Stock option plans, Shares	2.2
Employee stock purchase plan	17			17
Employee stock purchase plan, Shares	0.4
Other	5			5
Other, Shares	0.1
Stock-based compensation	26			26
Repurchase of common stock		(1,728)		(1,728)
Repurchase of common stock, Shares	-39.1
Ending balance at Feb. 02, 2008	936	201	(22)	1,115
Ending balance, Shares at Feb. 02, 2008	220.9
Shareholders' Equity Rollforward
Net earnings		401		401
Other comprehensive earnings (loss):
Postretirement plan adjustments, net of tax			12	12
Comprehensive net earnings				413
Cash dividends paid ($0.64 per share in 2009 and 2008; $0.54 per share in 2007)		(138)		(138)
Effect of postretirement plan measurement date change		(3)		(3)
Issuance of common stock for:
Stock option plans	17			17
Stock option plans, Shares	0.8
Employee stock purchase plan	17			17
Employee stock purchase plan, Shares	0.6
Other	1			1
Stock-based compensation	26			26
Repurchase of common stock		(238)		(238)
Repurchase of common stock, Shares	-6.9
Ending balance at Jan. 31, 2009	997	223	(10)	1,210
Ending balance, Shares at Jan. 31, 2009	215.4
Shareholders' Equity Rollforward
Net earnings		441		441
Other comprehensive earnings (loss):
Postretirement plan adjustments, net of tax			(9)	(9)
Comprehensive net earnings				432
Cash dividends paid ($0.64 per share in 2009 and 2008; $0.54 per share in 2007)		(139)		(139)
Issuance of common stock for:
Stock option plans	27			27
Stock option plans, Shares	1.5
Employee stock purchase plan	13			13
Employee stock purchase plan, Shares	0.7
Other	1			1
Other, Shares	0.1
Stock-based compensation	28			28
Ending balance at Jan. 30, 2010	$1,066	$525	($19)	$1,572
Ending balance, Shares at Jan. 30, 2010	217.7

2_Consolidated Statements of Sh

Consolidated Statements of Shareholders Equity (Parenthetical) (USD $)
In Millions, except Per Share data	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009	12 Months Ended Feb. 02, 2008
Consolidated Statements of Shareholders Equity (Parenthetical)
Tax effect of postretirment plan adjustments	$6	($8)	($5)
Tax effect of fair value adjustment to investment in asset-backed securities			$3
Dividends paid (per share)	0.64	0.64	0.54

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (USD $)
In Millions	12 Months Ended Jan. 30, 2010	12 Months Ended Jan. 31, 2009	12 Months Ended Feb. 02, 2008
Operating Activities
Net earnings	$441	$401	$715
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization of buildings and equipment, net	313	302	269
Amortization of deferred property incentives and other, net	(42)	(21)	(36)
Stock-based compensation expense	32	28	26
Deferred income taxes, net	(58)	(36)	(42)
Tax benefit from stock-based payments	6	3	28
Excess tax benefit from stock-based payments	(7)	(4)	(26)
Provision for bad debt expense	251	173	107
Gain on sale of Faconnable			(34)
Change in operating assets and liabilities:
Accounts receivable	(159)	(93)	(1,083)
Investment in asset-backed securities			420
Merchandise inventories	(1)	53
Prepaid expenses and other assets	(38)	38	(36)
Accounts payable	168	16	(19)
Accrued salaries, wages and related benefits	120	(54)	(64)
Other current liabilities	8	28	36
Income taxes	73	(76)	(6)
Deferred property incentives	96	119	58
Other liabilities	48	(29)	(1)
Net cash provided by operating activities	1,251	848	312
Investing Activities
Capital expenditures	(360)	(563)	(501)
Change in credit card receivables originated at third parties	(182)	(232)	(151)
Proceeds from sale of Faconnable			216
Other, net	1	3	15
Net cash used in investing activities	(541)	(792)	(421)
Financing Activities
(Repayments) proceeds from commercial paper borrowings, net	(275)	275
Proceeds from long-term borrowings, net of discounts	399	150	2,510
Principal payments on long-term borrowings	(25)	(410)	(680)
Increase in cash book overdrafts	9	20	5
Cash dividends paid	(139)	(138)	(134)
Repurchase of common stock		(264)	(1,702)
Proceeds from exercise of stock options	21	13	34
Proceeds from employee stock purchase plan	13	17	17
Excess tax benefit from stock-based payments	7	4	26
Other, net	3	(9)	(12)
Net cash provided by (used in) financing activities	13	(342)	64
Net increase (decrease) in cash and cash equivalents	723	(286)	(45)
Cash and cash equivalents at beginning of year	72	358	403
Cash and cash equivalents at end of year	795	72	358
Cash paid during the year for:
Interest (net of capitalized interest)	134	145	75
Income taxes	$240	$340	$478

NATURE OF OPERATIONS AND SUMMAR

NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	12 Months Ended Jan. 30, 2010
Nature Of Operations And Summary Of Significant Accounting Policies [Abstract]
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 1: NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The Company Founded in 1901 as a shoe store in Seattle, today Nordstrom is a fashion specialty retailer that offers customers a well-edited selection of high-quality fashion brands focused on apparel, shoes, cosmetics and accessories for men, women and children. This breadth of merchandise allows us to serve a wide range of customers who appreciate quality fashion and a superior shopping experience. We offer a wide selection of brand name and private label merchandise through multiple retail channels: our Nordstrom branded 112 full-line stores and online store at www.nordstrom.com (collectively, multi-channel), 69 off-price Nordstrom Rack stores, two Jeffrey boutiques, and one clearance store. Our stores are located throughout the United States. Through our Credit segment, we offer our customers a variety of payment products and services, including a Nordstrom private label card, two Nordstrom VISA credit cards and a debit card for Nordstrom purchases. These products also allow our customers to participate in our loyalty program. Fiscal Year Our fiscal year ends on the Saturday closest to January 31st. References to 2009, 2008 and 2007 relate to the 52-week fiscal years ended January 30, 2010, January 31, 2009 and February 2, 2008, respectively. References to 2010 relate to the 52-week fiscal year ending January 29, 2011. Principles of Consolidation The consolidated financial statements include the balances of Nordstrom, Inc. and its subsidiaries. All intercompany transactions and balances are eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses during the reporting period. Uncertainties regarding such estimates and assumptions are inherent in the preparation of financial statements and actual results may differ from those estimates and assumptions. Our significant accounting judgments and estimates include allowance for doubtful accounts, sales return reserve, inventory obsolescence and shrinkage reserves, deferred tax asset valuation and unrecognized tax benefits. Reclassification In 2009, we reclassified other income and expense, net in our consolidated statement of earnings to selling, general and administrative expenses and earnings on investment in asset-backed securities, net. Results for 2008 and 2007 have been reclassified for consistency with the 2009 presentation. These reclassifications do not impact our reported net earnings, earnings per share or cash flows for these periods. Net Sales We recognize revenue from sales at our retail stores at the point of sale, net of estimated returns and excluding sales taxes. Revenue from our sales to customers shipped directly from our stores and our online and catalog sales includes shipping revenue, when applicable, and is recognized upon estimated

ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE
	12 Months Ended Jan. 30, 2010
Accounts Receivable [Abstract]
ACCOUNTS RECEIVABLE	NOTE 2: ACCOUNTS RECEIVABLE The components of accounts receivable are as follows: January 30, 2010 January 31, 2009 Trade receivables: Restricted $2,136 $2,005 Unrestricted 26 14 Allowance for doubtful accounts (190) (138) Trade receivables, net 1,972 1,881 Other 63 61 Accounts receivable, net $2,035 $1,942 The following table summarizes the restricted trade receivables: January 30, 2010 January 31, 2009 Nordstrom VISA credit card receivables $1,469 $1,369 Private label card receivables 667 636 Restricted trade receivables $2,136 $2,005 The restricted trade receivables relate to substantially all of our Nordstrom private label card receivables and our Nordstrom VISA credit card receivables. Under our securitization program, the restricted trade receivables are transferred to a third-party trust on a daily basis. The restricted trade receivables secure our Series 2007-1 Notes, the Series 2007-2 Notes and our two variable funding notes. Our credit card securitization agreements set a maximum percentage of receivables that can be associated with various receivable categories, such as employee or foreign receivables. As of January 30, 2010 and January 31, 2009, these maximums were not exceeded. The unrestricted trade receivables consist primarily of the remaining portion of our Nordstrom private label card receivables and our Nordstrom VISA credit card receivables and accrued finance charges not yet allocated to customer accounts. Other accounts receivable consist primarily of credit card receivables due from third-party financial institutions and vendor claims.

LAND, BUILDINGS AND EQUIPMENT

LAND, BUILDINGS AND EQUIPMENT
	12 Months Ended Jan. 30, 2010
LAND, BUILDINGS AND EQUIPMENT
LAND, BUILDINGS AND EQUIPMENT	NOTE 3: LAND, BUILDINGS AND EQUIPMENT Land, buildings and equipment consist of the following: January 30, 2010 January 31, 2009 Land and land improvements $70 $67 Buildings and building improvements 924 847 Leasehold improvements 1,735 1,631 Store fixtures and equipment 2,267 2,214 Capitalized software 382 347 Construction in progress 180 222 5,558 5,328 Less: accumulated depreciation and amortization (3,316) (3,107) Land, buildings and equipment, net $2,242 $2,221 The total cost of buildings and equipment held under capital lease obligations was $28 at the end of both 2009 and 2008, with related accumulated amortization of $22 in 2009 and $21 in 2008. The amortization of capitalized leased buildings and equipment of $1 in both 2009 and 2008 was recorded in depreciation expense.

SELF INSURANCE

SELF INSURANCE
	12 Months Ended Jan. 30, 2010
SELF INSURANCE [Abstract]
SELF INSURANCE	NOTE 4: SELF INSURANCE Our self insurance reserves are summarized as follows: January 30, 2010 January 31, 2009 Employee health and welfare $20 $16 Workers compensation 50 53 General liability 10 11 Total $80 $80 We are self-insured for the majority of our employee health and welfare coverage, and we do not use stop-loss coverage. Participants contribute to the cost of their coverage through both premiums and out-of-pocket expenses and are subject to certain plan limits and deductibles. Our workers compensation policies have a retention per claim of $1 or less and no policy limits. Our general liability policies, encompassing employment practices liability and commercial general liability, have a retention per claim of $1 or less and a policy limit up to $25 and $150, respectively.

401

401(k) AND PROFIT SHARING
	12 Months Ended Jan. 30, 2010
Profit Sharing And 401 K Abstract
401(k) AND PROFIT SHARING	NOTE 5: 401(k) AND PROFIT SHARING We provide a 401(k) and profit sharing plan for our employees. Our Board of Directors establishes our profit sharing contribution each year. The 401(k) component is funded by voluntary employee contributions. In February 2009, the plan was amended to replace our fixed company matching contribution with a discretionary contribution in an amount determined by our Board of Directors. Our expense related to the profit sharing component and matching contributions to the 401(k) component totaled $74, $39 and $50 in 2009, 2008 and 2007.

POSTRETIREMENT BENEFITS

POSTRETIREMENT BENEFITS
	12 Months Ended Jan. 30, 2010
Postretirement Benefits [Abstract]
POSTRETIREMENT BENEFITS	NOTE 6: POSTRETIREMENT BENEFITS We have an unfunded defined benefit Supplemental Executive Retirement Plan (SERP), which provides retirement benefits to certain officers and select employees. The SERP has different benefit levels depending on the participants role in the company. At the end of 2009 and 2008 there were 35 and 33 officers and select employees eligible for SERP benefits. This plan is non-qualified and does not have a minimum funding requirement. Benefit Obligations and Funded Status January 30, 2010 January 31, 2009 Change in benefit obligation: Benefit obligation at beginning of year $85 $95 Participant service cost 2 3 Interest cost 6 7 Benefits paid (4) (4) Actuarial loss (gain) 13 (16) Benefit obligation at end of year $102 $85 Change in plan assets: Fair value of plan assets at beginning of year Employer contribution $4 $4 Benefits paid (4) (4) Fair value of plan assets at end of year Underfunded status at end of year $(102) $(85) The accumulated benefit obligation, which is the present value of benefits earned to date, assuming no salary growth, was $96 and $81 at the end of 2009 and 2008. Amounts recognized as liabilities in the consolidated balance sheets consist of the following: January 30, 2010 January 31, 2009 Current liabilities $5 $5 Noncurrent liabilities 97 80 Net amount recognized $102 $85 Components of SERP Expense The components of SERP expense recognized in the consolidated statements of earnings are as follows: Fiscal year 2009 2008 2007 Participant service cost $2 $2 $2 Interest cost 6 6 6 Amortization of net loss 2 3 Amortization of prior service cost 1 1 Total SERP expense $8 $11 $12 Amounts not yet reflected in SERP expense and included in accumulated other comprehensive earnings (pre-tax) consist of the following: January 30, 2010 January 31, 2009 Accumulated loss $(22) $(9) Prior service cost (2) (2) Total accumulated comprehensive loss $(24) $(11) In 2010, we expect $2 of costs currently in accumulated other comprehensive earnings to be recognized as components of SERP expense. Assumptions Weighted-average assumptions used to determine benefit obligation and SERP expense are as follows: Fiscal year 2009 2008 2007 Assumptions used to determine benefit obligation: Discount rate 5.95% 6.95% 6.35% Rate of compensation increase 3.00% 3.00% 3.00% Assumptions used to determine SERP expense: Discount rate 6.95% 6.35% 6.00% Rate of compensation increase 3.00% 3.00% 4.00% In accordance with ASC 715, Compensation-Retirement Benefits (formerly SFAS 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Benefit Plans), during 2008, we recognized a one-time adjustment of ($3) to reta

DEBT AND CREDIT FACILITIES

DEBT AND CREDIT FACILITIES
	12 Months Ended Jan. 30, 2010
Debt And Credit Facilities [Abstract]
DEBT AND CREDIT FACILITIES	NOTE 7: DEBT AND CREDIT FACILITIES Debt A summary of our long-term debt is as follows: January 30, 2010 January 31, 2009 Secured Series 2007-1 Class A Notes, 4.92%, due April 2010 $326 $326 Series 2007-1 Class B Notes, 5.02%, due April 2010 24 24 Series 2007-2 Class A Notes, one-month LIBOR plus 0.06% per year, due April 2012 454 454 Series 2007-2 Class B Notes, one-month LIBOR plus 0.18% per year, due April 2012 46 46 Mortgage payable, 7.68%, due April 2020 60 63 Other 15 17 925 930 Unsecured Senior notes, 6.75%, due June 2014, net of unamortized discount 399 - Senior notes, 6.25%, due January 2018, net of unamortized discount 647 646 Senior debentures, 6.95%, due March 2028 300 300 Senior notes, 7.00%, due January 2038, net of unamortized discount 343 343 Other (1) 19 1,688 1,308 Total long-term debt 2,613 2,238 Less: current portion (356) (24) Total due beyond one year $2,257 $2,214 Both the Series 2007-1 Class A B Notes and the Series 2007-2 Class A B Notes are secured by substantially all of the Nordstrom private label card receivables and a 90% interest in the Nordstrom VISA credit card receivables. Our mortgage payable is secured by an office building which had a net book value of $78 at the end of 2009. During 2009, we issued $400 of senior unsecured notes at 6.75%, due June 2014. After deducting the original issue discount of $1 and other fees and expenses of $3, net proceeds from the offering were $396. We used a portion of the proceeds from the issuance to repay the $140 in outstanding issuances of commercial paper as of May 26, 2009, the date the senior notes were issued. During 2009, we also repaid $19 in unsecured debt related to the acquisition of Jeffrey. Other secured debt as of January 30, 2010 consists primarily of capital lease obligations. Other unsecured debt as of January 30, 2010 consists primarily of an adjustment to the carrying value of our long-term debt associated with the fair value of our interest rate swap. During 2009, we entered into interest rate swap agreements (collectively, the swap) with a $650 notional amount maturing in 2018. Under the swap we receive a fixed rate of 6.25% and pay a variable rate based on one month LIBOR plus a margin of 2.9% (3.1% at January 30, 2010). Required principal payments on long-term debt, excluding capital lease obligations, are as follows: Fiscal year 2010 $355 2011 5 2012 505 2013 5 2014 404 Thereafter 1,328 Interest Expense The components of interest expense, net are as follows: Fiscal year 2009 2008 2007 Interest expense on long-term debt and short-term borrowings $148 $145 $102 Less: Interest income (3) (3) (16) Capitalized interest (7) (11) (12) Interest expense, net $138 $131 $74 Credit Facilities As of January 30, 2010, we ha

LEASES

LEASES
	12 Months Ended Jan. 30, 2010
Leases [Abstract]
LEASES	NOTE 8: LEASES We lease the land or the land and buildings at many of our full-line stores, and we lease the buildings at many of our Rack stores. Additionally, we lease office facilities, warehouses and equipment. Most of these leases are classified as operating leases and they expire at various dates through 2080. Our fixed, non-cancelable lease terms are generally 20 to 30 years for full-line stores and 10 to 15 years for Rack stores. Many of our leases include options that allow us to extend the lease term beyond the initial commitment period, subject to terms agreed to at lease inception. Most of our leases also provide for payment of operating expenses, such as common area charges, real estate taxes and other executory costs, and some leases require additional payments based on sales. Future minimum lease payments as of January 30, 2010 are as follows: Fiscal year Capital Leases Operating Leases 2010 $2 $98 2011 2 101 2012 2 89 2013 2 82 2014 2 78 Thereafter 7 406 Total minimum lease payments 17 $854 Less amount representing interest (5) Present value of net minimum lease payments $12 Rent expense for 2009, 2008 and 2007 was as follows: Fiscal year 2009 2008 2007 Minimum rent: Store locations $76 $63 $67 Offices, warehouses and equipment 13 13 14 Percentage rent store locations 9 9 14 Property incentives store locations (55) (48) (47) Total rent expense $43 $37 $48 The rent expense above does not include common area maintenance costs which were $19 in each of 2009, 2008 and 2007.

COMMITMENTS AND CONTINGENT LIAB

COMMITMENTS AND CONTINGENT LIABILITIES
	12 Months Ended Jan. 30, 2010
Commitments And Contingent Liabilities [Abstract]
COMMITMENTS AND CONTINGENT LIABILITIES	NOTE 9: COMMITMENTS AND CONTINGENT LIABILITIES Our estimated total purchase obligations, capital expenditure contractual commitments and inventory purchase orders were $1,221 as of January 30, 2010. In connection with the purchase of foreign merchandise, we have outstanding import letters of credit totaling $5 as of January 30, 2010. We are subject from time to time to various claims and lawsuits arising in the ordinary course of business including lawsuits alleging violations by us of state and/or federal wage and hour laws. Some of these suits purport or have been determined to be class actions and/or seek substantial damages. While we cannot predict the outcome of these matters with certainty, we do not believe any such claim, proceeding or litigation, either alone or in aggregate, will have a material impact on our financial condition, results of operations or cash flows.

SHAREHOLDERS EQUITY

SHAREHOLDERS EQUITY
	12 Months Ended Jan. 30, 2010
Stockholders' Equity [Abstract]
SHAREHOLDERS' EQUITY	NOTE 10: SHAREHOLDERS EQUITY Share Repurchase Program The following is a summary of the activity related to our share repurchase programs in 2007, 2008 and 2009: Period Shares Average Price per Share Amount Capacity at February 4, 2007 $592 August 2007 authorization 1,500 November 2007 authorization 1,000 Shares repurchased (2/4/07 to 2/2/08) 39.1 $44.17 -1,728 Capacity at February 2, 2008 $1,364 Shares repurchased (2/3/08 to /31/09) 6.9 $34.29 -238 Capacity at January 31, 2009 $1,126 Shares repurchased (2/1/09 to 1/30/10) - - - Unused capacity upon program expiration in August 2009 -1,126 Capacity at January 30, 2010 Fiscal 2007 share repurchases included $300 repurchased as part of an accelerated share repurchase program. We repurchased 5.4 shares of our common stock on May 23, 2007 at $55.17 per share and in June 2007, we received 0.4 shares at no additional cost, based on the volume weighted average price of our common stock from June 1, 2007 to June 26, 2007. This resulted in an average price per share of $51.69 for the accelerated share repurchase as a whole. Dividends We paid dividends of $0.64 per share in 2009 and 2008 and $0.54 per share in 2007.

STOCK COMPENSATION PLANS

STOCK COMPENSATION PLANS
	12 Months Ended Jan. 30, 2010
Stock Compensation Plans [Abstract]
STOCK COMPENSATION PLANS	NOTE 11: STOCK COMPENSATION PLANS We currently have three stock-based compensation plans: the 2004 Equity Incentive Plan, the 2002 Nonemployee Director Stock Incentive Plan and our Employee Stock Purchase Plan. Under our 2004 Equity Incentive plan, we grant non-qualified stock options, performance share units and common shares to employees. As of January 30, 2010, we have 48.4 shares authorized, 25.4 shares issued and outstanding and 7.8 shares available for grant. The Nonemployee Director Stock Incentive Plan authorizes the grant of stock awards to our nonemployee directors. These awards may be deferred or issued in the form of restricted or unrestricted stock, non-qualified stock options or stock appreciation rights. As of January 30, 2010, we had 0.9 shares authorized and 0.7 remaining shares available for issuance. In 2009, we deferred shares with a total expense of $1. Under the Employee Stock Purchase Plan (ESPP), employees may make payroll deductions of up to ten percent of their base and bonus compensation. At the end of each six-month offering period, participants may apply their accumulated payroll deductions toward the purchase of shares of our common stock at 90% of the fair market value on the last day of the offer period. As of January 30, 2010, we had 9.4 shares authorized and 1.7 shares available for issuance under the ESPP. We issued 0.7 shares under the ESPP during 2009. At the end of 2009 and 2008, we had current liabilities of $4 and $5, respectively, for future purchases of shares under the ESPP. The following table summarizes our stock-based compensation expense: Fiscal year 2009 2008 2007 Stock options $26 $24 $23 Performance share units 3 - (1) Employee stock purchase plan 1 2 2 Other 2 2 2 Total stock-based compensation expense before income tax benefit 32 28 26 Income tax benefit (12) (10) (9) Total stock-based compensation expense, net of income tax benefit $20 $18 $17 The stock-based compensation expense before income tax benefit was recorded in our consolidated statements of earnings as follows: Fiscal year 2009 2008 2007 Cost of sales and related buying and occupancy costs $10 $10 $10 Selling, general and administrative expenses 22 18 16 Total stock-based compensation expense before income tax benefit $32 $28 $26 The benefits of tax deductions in excess of the compensation cost recognized for stock-based awards are classified as financing cash inflows and are reflected as Excess tax benefit from stock-based payments in the consolidated statements of cash flows. Stock Options We used the following assumptions to estimate the fair value for stock options at grant date: Fiscal year 2009 2008 2007 Risk-free interest rate: Represents the yield on U.S. Treasury zero-coupon securities that mature over the 10-year life of the stock options. 0.7% 3.3% 2.0% - 4.3% 4.6% - 4.7% Weighted average volatility: Based on a combination of

INCOME TAXES

INCOME TAXES
	12 Months Ended Jan. 30, 2010
Income Taxes [Abstract]
INCOME TAXES	NOTE 12: INCOME TAXES Income tax expense consists of the following: Fiscal year 2009 2008 2007 Current income taxes: Federal $275 $244 $435 State and local 38 39 65 Total current income tax expense 313 283 500 Deferred income taxes: Current (28) (29) (24) Non-current (30) (7) (18) Total deferred income tax benefit (58) (36) (42) Total income tax expense $255 $247 $458 A reconciliation of the statutory Federal income tax rate to the effective tax rate on earnings before income taxes is as follows: Fiscal year 2009 2008 2007 Statutory rate 35.0% 35.0% 35.0% State and local income taxes, net of federal income taxes 3.5 3.4 3.4 Deferred tax adjustment (1.8) (3.2) - Permanent differences (0.6) 2.0 - Other, net 0.5 0.9 0.6 Effective tax rate 36.6% 38.1% 39.0% In 2009 and 2008, the IRS completed its routine examination of our federal filings for the 2007 and 2002 through 2006 years, respectively. As a result of adjustments identified in the IRS examinations and revisions of estimates, we increased our deferred tax assets, which resulted in a reduction in our effective tax rate in 2009 and 2008. The major components of deferred tax assets and liabilities are as follows: January 30, 2010 January 31, 2009 Compensation and benefits accruals $123 $99 Accrued expenses 67 63 Merchandise inventories 24 26 Land, buildings and equipment basis and depreciation differences 13 7 Gift cards and gift certificates 18 17 Loyalty reward certificates 12 11 Allowance for doubtful accounts 74 54 Federal benefit of state taxes 11 10 Other 11 2 Total deferred tax assets 353 289 Total deferred tax liabilities - Net deferred tax assets $353 $289 A reconciliation of the beginning and ending amount of unrecognized tax benefits for 2009, 2008 and 2007 is as follows: Fiscal Year 2009 2008 2007 Unrecognized tax benefit at beginning of year $28 $27 $21 Gross increase to tax positions in prior periods 18 2 5 Gross decrease to tax positions in prior periods (3) (1) (1) Gross increase to tax positions in current period 3 4 3 Lapse of statute (1) (1) Settlements (3) (3) - Unrecognized tax benefit at end of year $43 $28 $27 At the end of 2009, 2008 and 2007, $25, $10 and $9 of the ending gross unrecognized tax benefit balance relates to deferred items which, if recognized, would not impact the effective tax rate. During both 2009 and 2008, our income tax expense included $2 of tax-related interest and penalties. During 2007, our income tax expense included $3 of tax-related interest and penalties. At the end of 2009, 2008 and 2007, our liability for interest and penalti

EARNINGS PER SHARE

EARNINGS PER SHARE
	12 Months Ended Jan. 30, 2010
Earnings Per Share [Abstract]
EARNINGS PER SHARE	NOTE 13: EARNINGS PER SHARE Earnings per basic share is computed using the weighted average number of common shares outstanding during the year. Earnings per diluted share uses the weighted average number of common shares outstanding during the year plus dilutive common stock equivalents, primarily stock options and performance share units. The computation of earnings per share is as follows: Fiscal year 2009 2008 2007 Net earnings $441 $401 $715 Basic shares 216.8 216.6 244.8 Dilutive effect of stock options and performance share units 2.9 2.6 4.0 Diluted shares 219.7 219.2 248.8 Earnings per basic share $2.03 $1.85 $2.92 Earnings per diluted share $2.01 $1.83 $2.88 Options and other equity instruments totaling 7.2 shares in 2009, 4.9 shares in 2008 and 2.7 shares in 2007 were excluded from earnings per diluted share because their impact was anti-dilutive.

SEGMENT REPORTING

SEGMENT REPORTING
	12 Months Ended Jan. 30, 2010
Segment Reporting [Abstract]
SEGMENT REPORTING	NOTE 14: SEGMENT REPORTING As of January 30, 2010, we have identified four reportable segments: Retail Stores, Direct, Credit and Other. Our Retail Stores segment includes our Nordstrom full-line stores and our Nordstrom Rack off-price stores, which meet the aggregation criteria set forth in ASC 280, Segment Reporting. Through our Direct segment, we operate our Nordstrom branded online store. With our multi-channel initiative, we are increasingly integrating our Nordstrom full-line stores and online store. Our goal is to create a seamless, consistent merchandise offering and service experience for our customers regardless of how they choose to shop. Through our Credit segment, we offer our customers a variety of payment products and services, including a Nordstrom private label card, two Nordstrom VISA credit cards and a debit card for Nordstrom purchases. Our card products also include a loyalty program that provides benefits to our cardholders based on their level of spending. The Other segment includes our product development group, which coordinates the design and production of private label merchandise sold in our retail stores, and our distribution network. This segment also includes our corporate center operations. During the time that we owned it, this segment also included the operations of our Faonnable business. The following table summarizes net sales by merchandise category: Fiscal year 2009 2008 2007 Womens apparel $2,845 $2,812 $3,063 Shoes 1,787 1,721 1,784 Mens apparel 1,262 1,362 1,571 Womens accessories 970 963 941 Cosmetics 895 921 950 Childrens apparel 283 269 285 Other 216 224 234 Total $8,258 $8,272 $8,828 The following table presents our sales by merchandise category as a percentage of net sales: Fiscal year 2009 2008 2007 Womens apparel 34% 34% 35% Shoes 22% 21% 20% Mens apparel 15% 16% 18% Womens accessories 12% 12% 11% Cosmetics 11% 11% 11% Childrens apparel 3% 3% 3% Other 3% 3% 2% Total 100% 100% 100% In general, we use the same measurements to compute earnings before income taxes for reportable segments as we do for the consolidated company. However, redemptions of our Nordstrom Notes are included in net sales for our Retail Stores segment. The sales amount in our Other segment includes an entry to eliminate these transactions from our consolidated net sales. There is no impact to consolidated earnings before income taxes for this adjustment. In addition, our sales return reserve and other corporate adjustments are recorded in the Other segment. Other than described above, the accounting policies of the operating segments are the same as those described in the summary of significant accounting policies in Note 1. The following tables set forth information for our reportable segments: Retail Fiscal year 2009 Stores Direct Credit Other Total Net s

SELECTED QUARTERLY DATA

SELECTED QUARTERLY DATA (UNAUDITED)
	12 Months Ended Jan. 30, 2010
Selected Quarterly Data [Abstract]
SELECTED QUARTERLY DATA (UNAUDITED)	NOTE 15: SELECTED QUARTERLY DATA (UNAUDITED) Fiscal year 2009 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Net sales $1,706 $2,145 $1,868 $2,539 $8,258 Same-store sales percentage change (13.2%) (9.8%) (1.2%) 6.9% (4.2%) Credit card revenues 86 87 95 101 369 Gross profit1 599 727 658 946 2,930 Selling, general and administrative expenses: Retail stores, direct and other segments 447 531 500 631 2,109 Credit segment 92 77 81 106 356 Earnings before income taxes 115 170 134 277 696 Net earnings 81 105 83 172 441 Net earnings as a percentage of total revenues 4.5% 4.7% 4.2% 6.5% 5.1% Earnings per basic share $0.38 $0.49 $0.38 $0.79 $2.03 Earnings per diluted share $0.37 $0.48 $0.38 $0.77 $2.01 Fiscal year 2008 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Total Net sales $1,879 $2,287 $1,805 $2,301 $8,272 Same-store sales percentage change (6.5%) (6.0%) (11.1%) (12.5%) (9.0%) Credit card revenues 70 72 74 85 301 Gross profit1 700 799 620 736 2,855 Selling, general and administrative expenses: Retail stores, direct and other segments 493 545 490 575 2,103 Credit segment 50 57 77 90 274 Earnings before income taxes 196 235 94 123 648 Net earnings 119 143 71 68 401 Net earnings as a percentage of total revenues 6.1% 6.1% 3.8% 2.8% 4.7% Earnings per basic share $0.54 $0.66 $0.33 $0.32 $1.85 Earnings per diluted share $0.54 $0.65 $0.33 $0.31 $1.83 1Gross profit is calculated as net sales less cost of sales and related buying and occupancy costs.

SALE OF FACONNABLE

SALE OF FACONNABLE
	12 Months Ended Jan. 30, 2010
Sale Of Faconnable [Abstract]
SALE OF FACONNABLE	NOTE 16: SALE OF FAONNABLE During the third quarter of 2007, we completed the sale of our Faonnable business in exchange for cash of $216, net of transaction costs. As part of this transaction, goodwill of $28, acquired tradename of $84, and foreign currency translation of $16 were removed from our consolidated balance sheet and we recorded a gain of $34. Upon the closing of this transaction, we entered into a Transition Services Agreement, whereby we provided back office functions related to the Faonnable U.S. wholesale business. This agreement ended during 2009.

SCHEDULE II - VALUATION AND QUA

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
	12 Months Ended Jan. 30, 2010
Schedule of Valuation and Qualifying Accounts Disclosure [Abstract]
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS	SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Dollars in millions) Column A Column B Column C Column D Column E Additions Description Balance at beginning of period Charged to costs and expenses Deductions Balance at end of period Deducted from related consolidated balance sheet account Allowance for doubtful accounts: Year ended: January 30, 2010 $138 $251 $199 (B) $190 January 31, 2009 73 173 108 (B) 138 February 2, 2008 17 86 (A) 30 (B) 73 Reserves Allowance for sales return, net: Year ended: January 30, 2010 $70 $1,030 $1,024 (C) $76 January 31, 2009 56 1,051 1,037 (C) 70 February 2, 2008 55 1,023 1,022 (C) 56 (A) These expenses do not include write-offs of $21 related to the one-time transition of our VISA portfolio to on-balance sheet, which are included in credit selling, general and administrative expenses. (B) Deductions consist of write-offs of uncollectible accounts, net of recoveries. (C) Deductions consist of actual returns offset by the value of the merchandise returned and the sales commission reversed.