Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Feb. 22, 2023 | Jun. 24, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2022 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | ODP | ||
Entity Registrant Name | The ODP Corporation | ||
Entity Central Index Key | 0000800240 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
ICFR Auditor Attestation Flag | true | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Common Stock, Shares Outstanding | 40,198,205 | ||
Entity Public Float | $ 1,462,200,515 | ||
Entity Shell Company | false | ||
Entity File Number | 1-10948 | ||
Entity Tax Identification Number | 85-1457062 | ||
Entity Address, Address Line One | 6600 North Military Trail | ||
Entity Address, City or Town | Boca Raton | ||
Entity Address, State or Province | FL | ||
Entity Address, Postal Zip Code | 33496 | ||
City Area Code | 561 | ||
Local Phone Number | 438-4800 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Interactive Data Current | Yes | ||
Entity Incorporation, State or Country Code | DE | ||
Title of 12(b) Security | Common Stock, par value $0.01 per share | ||
Security Exchange Name | NASDAQ | ||
Auditor Name | Deloitte & Touche LLP | ||
Auditor Location | Boca Raton, Florida | ||
Auditor Firm ID | 34 | ||
Documents Incorporated by Reference | Documents Incorporated by Reference: Certain information required for Part III of this Annual Report on Form 10-K is incorporated by reference to The ODP Corporation’s definitive Proxy Statement for its 2023 Annual Meeting of Shareholders, to be filed with the Securities and Exchange Commission within 120 days after close of the registrant’s fiscal year covered by this Annual Report. |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Income Statement [Abstract] | |||
Sales | $ 8,491 | $ 8,465 | $ 8,872 |
Cost of goods sold and occupancy costs | 6,643 | 6,602 | 6,921 |
Gross profit | 1,848 | 1,863 | 1,951 |
Selling, general and administrative expenses | 1,552 | 1,558 | 1,661 |
Asset impairments | 14 | 20 | 182 |
Merger, restructuring and other operating expenses, net | 39 | 51 | 102 |
Operating income | 243 | 234 | 6 |
Other income (expense): | |||
Interest income | 5 | 1 | 4 |
Interest expense | (16) | (28) | (42) |
Loss on extinguishment and modification of debt | (12) | ||
Other income, net | 10 | 24 | 6 |
Income (loss) from continuing operations before income taxes | 242 | 231 | (38) |
Income tax expense | 64 | 44 | 25 |
Net income (loss) from continuing operations | 178 | 187 | (63) |
Discontinued operations, net of tax | (12) | (395) | (256) |
Net income (loss) | $ 166 | $ (208) | $ (319) |
Basic earnings (loss) per share | |||
Continuing operations | $ 3.73 | $ 3.54 | $ (1.20) |
Discontinued operations | (0.25) | (7.47) | (4.85) |
Net basic earnings (loss) per share | 3.48 | (3.93) | (6.05) |
Diluted earnings (loss) per share | |||
Continuing operations | 3.61 | 3.42 | (1.20) |
Discontinued operations | (0.24) | (7.21) | (4.85) |
Net diluted earnings (loss) per share | $ 3.37 | $ (3.79) | $ (6.05) |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Net income (loss) | $ 166 | $ (208) | $ (319) |
Other comprehensive income, net of tax, where applicable: | |||
Foreign currency translation adjustments | (12) | 2 | |
Change in deferred pension, net of $(3) million, $6 million and $7 million of deferred income taxes in 2022, 2021 and 2020, respectively | (59) | 26 | 32 |
Total other comprehensive income, net of tax, where applicable | (71) | 26 | 34 |
Comprehensive income (loss) | $ 95 | $ (182) | $ (285) |
CONSOLIDATED STATEMENTS OF CO_2
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Statement Of Income And Comprehensive Income [Abstract] | |||
Change in deferred pension, deferred income taxes | $ (3) | $ 6 | $ 7 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 | |
Current assets: | |||
Cash and cash equivalents | $ 403 | $ 514 | |
Receivables, net | 536 | 495 | |
Inventories | 828 | 859 | |
Prepaid expenses and other current assets | 36 | 52 | |
Current assets held for sale | 107 | 469 | |
Total current assets | 1,910 | 2,389 | |
Property and equipment, net | 352 | 477 | |
Operating lease right-of-use assets | 874 | 936 | |
Goodwill | 464 | 464 | |
Other intangible assets, net | 46 | 54 | |
Deferred income taxes | 182 | 219 | |
Other assets | 321 | 326 | |
Total assets | 4,149 | 4,865 | |
Current liabilities: | |||
Trade accounts payable | 821 | 950 | |
Accrued expenses and other current liabilities | 1,005 | 994 | |
Income taxes payable | 17 | 11 | |
Short-term borrowings and current maturities of long-term debt | 16 | 20 | |
Current liabilities held for sale | 290 | ||
Total current liabilities | 1,859 | 2,265 | |
Deferred income taxes and other long-term liabilities | 122 | 159 | |
Pension and postretirement obligations, net | 16 | 22 | |
Long-term debt, net of current maturities | 172 | 228 | |
Operating lease liabilities | 693 | [1] | 753 |
Total liabilities | 2,862 | 3,427 | |
Commitments and contingencies | |||
Stockholders’ equity: | |||
Common stock — authorized 80,000,000 shares of $0.01 par value; issued shares — 65,636,015 at December 31, 2022 and 64,704,979 at December 25, 2021; outstanding shares — 42,213,046 at December 31, 2022 and 48,455,951 at December 25, 2021 | 1 | 1 | |
Additional paid-in capital | 2,742 | 2,692 | |
Accumulated other comprehensive loss | (77) | (6) | |
Accumulated deficit | (451) | (617) | |
Treasury stock, at cost — 23,422,969 shares at December 31, 2022 and 16,249,028 shares at December 25, 2021 | (928) | (632) | |
Total stockholders’ equity | 1,287 | 1,438 | |
Total liabilities and stockholders’ equity | $ 4,149 | $ 4,865 | |
[1]Operating lease payments include $47 million related to options to extend lease terms that are reasonably certain of being exercised. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2022 | Dec. 25, 2021 |
Statement Of Financial Position [Abstract] | ||
Common stock, authorized | 80,000,000 | 80,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, issued shares | 65,636,015 | 64,704,979 |
Common stock, shares, outstanding | 42,213,046 | 48,455,951 |
Treasury stock, shares | 23,422,969 | 16,249,028 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Cash flows from operating activities: | |||
Net income (loss) | $ 166 | $ (208) | $ (319) |
Discontinued operations, net of tax | (12) | (395) | (256) |
Net income (loss) from continuing operations | 178 | 187 | (63) |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||
Depreciation and amortization | 131 | 146 | 157 |
Amortization of debt discount and issuance costs | 2 | 2 | 3 |
Charges for losses on receivables and inventories | 19 | 22 | 33 |
Asset impairments | 14 | 20 | 182 |
(Gain) loss on disposition of assets, net | (4) | (5) | 4 |
Loss on extinguishment and modification of debt | 12 | ||
Compensation expense for share-based payments | 40 | 38 | 41 |
Deferred income taxes and deferred tax asset valuation allowances | 40 | (6) | 11 |
Changes in assets and liabilities: | |||
Decrease (increase) in receivables | (42) | (61) | 185 |
Decrease in inventories | 13 | 35 | 76 |
Net decrease in prepaid expenses, operating lease right-of-use assets, and other assets | 282 | 281 | 304 |
Net increase in trade accounts payable, accrued expenses, operating lease liabilities, and other current and other long-term liabilities | (436) | (312) | (519) |
Other operating activities | (3) | (1) | |
Total adjustments | 59 | 157 | 488 |
Net cash provided by operating activities of continuing operations | 237 | 344 | 425 |
Net cash provided by operating activities of discontinued operations | 2 | 60 | |
Net cash provided by operating activities | 237 | 346 | 485 |
Cash flows from investing activities: | |||
Capital expenditures | (99) | (73) | (58) |
Businesses acquired, net of cash acquired | (29) | (30) | |
Proceeds from collection of notes receivable | 818 | ||
Proceeds from disposition of assets | 8 | 5 | 3 |
Settlement of company-owned life insurance policies | 5 | 22 | 13 |
Net cash provided by (used in) investing activities of continuing operations | (86) | (75) | 746 |
Net cash provided by (used in) investing activities of discontinued operations | 76 | (4) | (10) |
Net cash provided by (used in) investing activities | (10) | (79) | 736 |
Cash flows from financing activities: | |||
Net payments on long and short-term borrowings | (21) | (25) | (341) |
Debt retirement | (43) | (100) | (1,196) |
Debt issuance | 400 | ||
Cash dividends on common stock | (13) | ||
Share purchases for taxes, net of proceeds from employee share-based transactions | (20) | (26) | (5) |
Repurchase of common stock for treasury and advance payment for accelerated share repurchase | (266) | (307) | (30) |
Other financing activities | (5) | (1) | (8) |
Net cash used in financing activities of continuing operations | (355) | (459) | (1,193) |
Net cash used in financing activities | (355) | (459) | (1,193) |
Effect of exchange rate changes on cash and cash equivalents | (5) | 1 | |
Net increase (decrease) in cash, cash equivalents and restricted cash | (133) | (192) | 29 |
Cash, cash equivalents and restricted cash at beginning of period | 537 | 729 | 700 |
Cash, cash equivalents and restricted cash at end of period | 404 | 537 | 729 |
Less: cash and cash equivalents of discontinued operations | (23) | ||
Cash, cash equivalents and restricted cash at end of period — continuing operations | 404 | 514 | 729 |
Supplemental information on operating, investing, and financing activities | |||
Right-of-use assets obtained in exchange for new finance lease liabilities | 4 | 3 | 29 |
Right-of-use assets obtained in exchange for new operating lease liabilities | 228 | 127 | 117 |
Cash taxes paid (refunded), net | 17 | 43 | (14) |
Cash interest paid, net of amounts capitalized and Timber notes/Non-recourse debt | 16 | 25 | $ 40 |
Other current and noncurrent receivables obtained from disposition of discontinued operations | 9 | ||
Promissory note receivable obtained from disposition of discontinued operations | 55 | ||
Earn-out receivable obtained from disposition of discontinued operations | 9 | ||
Transfer from additional paid-in capital to treasury stock for final settlement of the accelerated share repurchase agreement | $ 29 | ||
Business acquired in exchange for common stock issuance | $ 35 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) $ in Millions | Total | BuyerQuest Acquisition | Adjustment for Adoption of Accounting Standard | Common Stock | Common Stock BuyerQuest Acquisition | Additional Paid-in Capital | Additional Paid-in Capital BuyerQuest Acquisition | Accumulated Other Comprehensive Loss | Accumulated Deficit | Accumulated Deficit Adjustment for Adoption of Accounting Standard | Treasury Stock |
Balance at Dec. 28, 2019 | $ 2,173 | $ 1 | $ 2,652 | $ (66) | $ (89) | $ (325) | |||||
Balance, Shares at Dec. 28, 2019 | 62,042,477 | ||||||||||
Net income (loss) | (319) | (319) | |||||||||
Other comprehensive income (loss) | 34 | 34 | |||||||||
Exercise and release of incentive stock (including income tax benefits and withholding) | (5) | (5) | |||||||||
Exercise and release of incentive stock (including income tax benefits and withholding) (in shares) | 508,778 | ||||||||||
Amortization of long-term incentive stock grants | 41 | 41 | |||||||||
Dividends paid on common stock | (13) | (13) | |||||||||
Repurchase of common stock | (30) | (30) | |||||||||
Balance at Dec. 26, 2020 | 1,880 | $ (1) | $ 1 | 2,675 | (32) | (409) | $ (1) | (355) | |||
Balance, Shares at Dec. 26, 2020 | 62,551,255 | ||||||||||
Net income (loss) | (208) | (208) | |||||||||
Other comprehensive income (loss) | 26 | 26 | |||||||||
Exercise and release of incentive stock (including income tax benefits and withholding) | (26) | (26) | |||||||||
Exercise and release of incentive stock (including income tax benefits and withholding) (in shares) | 1,326,226 | ||||||||||
Amortization of long-term incentive stock grants | 38 | 38 | |||||||||
Repurchase of common stock and advance payment for accelerated share repurchase | (307) | (30) | (277) | ||||||||
Common stock issuance related to theBuyerQuest acquisition | $ 35 | $ 35 | |||||||||
Common stock issuance related to the BuyerQuest acquisition, (in shares) | 827,498 | ||||||||||
Balance at Dec. 25, 2021 | 1,438 | $ 1 | 2,692 | (6) | (617) | (632) | |||||
Balance, Shares at Dec. 25, 2021 | 64,704,979 | ||||||||||
Net income (loss) | 166 | 166 | |||||||||
Other comprehensive income (loss) | (71) | (71) | |||||||||
Exercise and release of incentive stock (including income tax benefits and withholding) | (20) | (20) | |||||||||
Exercise and release of incentive stock (including income tax benefits and withholding) (in shares) | 931,036 | ||||||||||
Amortization of long-term incentive stock grants | 40 | 40 | |||||||||
Final settlement of the accelerated share repurchase agreement | 29 | (29) | |||||||||
Repurchase of common stock | (266) | (266) | |||||||||
Other | 1 | (1) | |||||||||
Balance at Dec. 31, 2022 | $ 1,287 | $ 1 | $ 2,742 | $ (77) | $ (451) | $ (928) | |||||
Balance, Shares at Dec. 31, 2022 | 65,636,015 |
CONSOLIDATED STATEMENTS OF ST_2
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) | 12 Months Ended |
Dec. 26, 2020 $ / shares | |
Statement Of Stockholders Equity [Abstract] | |
Dividend paid on common stock, per share | $ 0.25 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Business: The ODP Corporation (including its consolidated subsidiaries, “ODP” or the “Company”) is a leading provider of products, services and technology solutions through an integrated business-to-business (“B2B”) distribution platform and omni-channel presence, which includes supply chain and distribution operations, dedicated sales professionals, a B2B digital procurement solution, online presence, and a network of Office Depot and OfficeMax retail stores. Through its operating companies Office Depot, LLC; ODP Business Solutions, LLC; Veyer, LLC; and Varis, LLC, The ODP Corporation empowers every business, professional, and consumer to achieve more every day. Basis of Presentation: The Consolidated Financial Statements of ODP include the accounts of all wholly owned and financially controlled subsidiaries prior to disposition. The Company owns 88% of a subsidiary that formerly owned assets in Cuba, which were confiscated by the Cuban government in the 1960’s. Due to various asset restrictions, the fair value of this investment is not determinable, and no amounts are included in the Consolidated Financial Statements. Intercompany transactions have been eliminated in consolidation. Prior to the third quarter of 2022, the Company had two reportable segments (or “Divisions”), which were its Business Solutions Division and Retail Division. During the third quarter of 2022, the Company re-aligned its operations into its consumer business named Office Depot, and three distinct B2B business and digital segments which are ODP Business Solutions, Veyer and Varis. As a result, the Company re-evaluated its reportable segments, and determined that The Company’s CompuCom Division was sold through a single disposal group on December 31, 2021. The Company has reclassified the financial results of the CompuCom Division to Discontinued operations, net of tax in the Consolidated Statements of Operations for all periods presented. The Company also reclassified the related assets and liabilities as assets and liabilities held for sale on the accompanying Consolidated Balance Sheet a s of December 25, 2021, and presented cash flows from the Company’s discontinued operations in the Consolidated Statements of Cash Flows for all periods. As a result of the CompuCom Division’s presentation as discontinued operations, the Company’s level of service revenue is below 10% of the Company’s total revenue for all periods presented and accordingly, revenues and cost of sales from services and products are not separately disclosed in the Company’s Consolidated Statements of Operations. Prior period amounts have been reclassified to conform to the current period presentation. MAINTAINING ALL OPERATING BUSINESSES UNDER COMMON OWNERSHIP In May 2021, the Company’s Board of Directors unanimously approved a plan to pursue a separation of the Company into two independent, publicly traded companies representing its B2B and consumer businesses, which was planned to be achieved through a spin-off of its consumer business. On January 14, 2022, the Company announced that its Board of Directors determined to delay the previously announced public company separation to evaluate a potential sale of the Company’s consumer business and that it had received a non-binding proposal from another third party, in addition to the previously received proposal from USR Parent, Inc., to acquire the Company’s consumer business. On June 21, 2022, the Company’s Board of Directors, with the assistance of its financial and legal advisors, completed its review of both proposals received by the Company to acquire its consumer business and unanimously determined it to be in the best interests of the Company and its shareholders not to divest the consumer business at that time. Further, due to current market conditions, the Company’s Board of Directors also determined not to resume the Company’s previously planned spin-off of its consumer business at that time and instead maintain all of its businesses under common ownership. As discussed above, in connection with the Company’s announcement to maintain all of its businesses under common ownership, during the third quarter of 2022, the Company re-aligned its operations into its consumer business named Office Depot, and three distinct B2B business and digital segments which are ODP Business Solutions, Veyer and Varis. Fiscal Year: Fiscal years are based on a 52- or 53-week period ending on the last Saturday in December. Fiscal year 2022 had 53 weeks and ended on December 31, 2022. Fiscal year 2021 had 52 weeks and ended on December 25, 2021. Fiscal year 2020 had 52 weeks and ended on December 26, 2020. Certain subsidiaries operate on a calendar year basis; however, the reporting difference did not have a material impact in any period presented. Estimates and Assumptions: 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 and disclosure of contingent assets and liabilities at the date of the C onsolidated F inancial S tatements and the reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. The impact of the COVID-19 pandemic has been considered when making these estimates and assumptions, however, given the uncertainty related to the future effects of COVID-19, actual results could differ from these estimates. Business Combinations: The Company applies the acquisition method of accounting for acquisitions where the Company is considered the accounting acquirer in accordance with ASC Topic 805, “Business Combinations” (“ASC 805”). The results of operations of acquired businesses are included in the Company’s consolidated results prospectively from the date of acquisition. The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired, liabilities assumed, and non-controlling interests in the acquired entity generally based on their fair values at the acquisition date. Various valuation methodologies are used to estimate the fair value of assets acquired and liabilities assumed, including using a market participant perspective when applying cost, income and relief from royalty analyses, supplemented with market appraisals where appropriate. Significant judgments and estimates are required in preparing these fair value estimates. The excess of the fair value of purchase consideration over the fair value of the assets acquired, liabilities assumed and non-controlling interests in the acquired entity is recorded as goodwill. The primary items that generate goodwill include the value of the synergies between the acquired company and the Company and the value of the acquired assembled workforce, neither of which qualifies for recognition as an intangible asset. The Company did not have any acquisitions in 2022. Based on new information received, the preliminary purchase price allocations of the companies acquired in 2021 have been adjusted during the respective measurement periods. These adjustments were insignificant individually and in the aggregate to the Company’s Consolidated Financial Statements. The measurement periods for acquisitions completed in 2021 closed within 2022. Under the guidance on accounting for business combinations, merger and integration costs are not included as components of consideration transferred, instead, they are accounted for as expenses in the period in which the costs are incurred. Transaction-related expenses are included in the Merger, restructuring and other operating expenses, net line in the Consolidated Statements of Operations. Foreign Currency: International operations in Canada and China use local currencies as their functional currency. Assets and liabilities are translated into U.S. dollars using the exchange rate at the balance sheet date. Revenues, expenses and cash flows are translated at average monthly exchange rates, or rates on the date of the transaction for certain significant items. Translation adjustments resulting from this process are recorded in Stockholders’ equity as a component of Accumulated other comprehensive loss. Foreign currency transaction gains or losses are recorded in the Consolidated Statements of Operations in Other income (expense), net or Cost of goods sold and occupancy costs, depending on the nature of the transaction. Cash and Cash Equivalents: All short-term highly liquid investments with original maturities of three months or less from the date of acquisition are classified as cash equivalents. Amounts in transit from banks for customer credit card and debit card transactions are classified as cash. The banks process the majority of these amounts within two business days. Amounts not yet presented for payment to zero balance disbursement accounts of $16 million at December 31, 2022 are presented in Trade accounts payable and Accrued expenses and other current liabilities. At December 25, 2021, t here were no amounts not yet presented for payment to zero balance disbursement accounts At December 31, 2022 and December 25, 2021, cash and cash equivalents held outside the United States amounted to $113 million and $108 million, respectively. At December 25, 2021, there was $17 million cash and cash equivalents held outside the United states included in Current assets held for sale. Restricted cash consists primarily of cash in bank committed to fund UK pension obligations based on the agreements that govern the UK pension plan. Restricted cash is valued at cost, which approximates fair value. Restricted cash was $1 million at December 31, 2022. There was no restricted cash at December 25, 2021. Receivables: Trade receivables totaled $412 million and $353 million at December 31, 2022 and December 25, 2021, respectively, net of an allowance for doubtful accounts of $8 million and $9 million, respectively, to reduce receivables to an amount expected to be collectible from customers. Exposure to credit risk associated with trade receivables is limited by having a large customer base that extends across many different industries and geographic regions. However, receivables may be adversely affected by an economic slowdown in the United States or internationally , as well as the impact of the COVID -19 pandemic on the expected credit and collectability trends . No single customer accounted for more than 10% of total sales or receivables in 2022 , 2021 or 2020 . Other receivables were $ 123 million and $ 143 million at December 31, 2022 and December 25, 2021 , respectively, of which $ 82 million and $ 104 million, respectively, are amounts due from vendors under purchase rebate, cooperative advertising and various other marketing programs. Inventories: Inventories are stated at the lower of cost or net realizable value and are reduced for inventory losses based on estimated obsolescence, the impact of the COVID-19 pandemic on forecasted sales and expected selling prices, and the results of physical counts. The weighted average method is used throughout the Company to determine the cost of inventory. In-bound freight is included as a cost of inventories; cash discounts and certain vendor allowances that are related to inventory purchases are recorded as a product cost reduction. Income Taxes: Income taxes are accounted for under the asset and liability method. This approach requires the recognition of deferred tax assets and liabilities attributable to differences between the carrying amounts and the tax bases of assets and liabilities and operating loss and tax credit carryforwards. Valuation allowances are recorded to reduce deferred tax assets to the amount believed to be more likely than not to be realized. The Company recognizes tax benefits from uncertain tax positions when it is more likely than not that the position will be sustained upon examination. Interest related to income tax exposures is included in interest expense in the Consolidated Statements of Operations. Refer to Note 4 for additional information on income taxes. Property and Equipment: Property and equipment additions are recorded at cost. Depreciation and amortization is recognized over the estimated useful lives using the straight-line method. The useful lives of depreciable assets are estimated to be 15-30 years for buildings and 3-10 years for furniture, fixtures and equipment. Computer software is amortized over three years for common office applications, five years for larger business applications and seven years for certain enterprise-wide systems. Leasehold improvements are amortized over the shorter of the estimated economic lives of the improvements or the terms of the underlying leases, including renewal options considered reasonably assured. The Company capitalizes certain costs related to internal use software that is expected to benefit future periods. These costs are amortized using the straight-line method over the 3 to 7 year expected life of the software. Major repairs that extend the useful lives of assets are capitalized and amortized over the estimated use period. Routine maintenance costs are expensed as incurred. Refer to Note 6 for additional information on property and equipment. Goodwill and Other Intangible Assets: Goodwill represents the excess of the purchase price of an acquired entity over the fair value of the net tangible and identifiable intangible assets acquired and liabilities assumed in a business combination. The Company reviews the carrying amount of goodwill at the reporting unit level on an annual basis as of the first day of fiscal month December, or more frequently, if events or changes in circumstances suggest that goodwill may not be recoverable. For those reporting units where events or change in circumstances indicate that potential impairment indicators exist, the Company performs a quantitative assessment to determine whether the carrying amount of goodwill can be recovered. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. The changes in reportable segments described above also resulted in the change of the Company’s reporting units during the third quarter of 2022, where each reportable segment also represents a reporting unit. Goodwill was allocated to the new reporting units using their relative fair values. When performing the annual goodwill impairment test, the Company may start with an optional qualitative assessment. As part of the qualitative assessment, the Company evaluates all events and circumstances, including both positive and negative events, in their totality, to determine whether it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company bypasses the qualitative assessment, or if the qualitative assessment indicates that a quantitative analysis should be performed, the Company evaluates goodwill for impairment by comparing the fair value of a reporting unit to its carrying value, including the associated goodwill. The Company estimates the reporting unit’s fair value using discounted cash flow analysis and market-based evaluations, when available. If the carrying amount of the reporting unit exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. The Company typically uses a combination of different Level 3 valuation approaches that are dependent on several significant estimates and assumptions related to forecasts of future revenues, cost of sales, expenses and the weighted-average cost of capital for each reporting unit. Any adverse change in these factors could have a significant impact on the recoverability of goodwill and could have a material impact on the Company’s Consolidated Financial Statements. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually. The Company evaluates its indefinite - lived intangible assets for impairment annually, or sooner if indications of possible impairment are identified . When performing the annual impairment test , the Company may first start with an optional qualitative assessment to determine whether it is not more likely than not that its indefinite-lived intangible assets are impaired . As part of a qualitative assessment, the Company evaluates relevant events and circumstances that could affect the significant inputs used to determine the fair value of the indefinite -lived intangible asset. If the Company bypasses the qualitative assessment, or if the qualitative assessment indicates that a quantitative analysis should be performed, the Company evaluates its indefinite-lived intangible assets for impairment by comparing the fair value of the asset to its carrying amount. Intangible assets determined to have finite lives are amortized on a straight-line basis over their estimated useful lives, where the useful life is the period over which the asset is expected to contribute directly, or indirectly, to the Company’s future cash flows. The Company periodically reviews its amortizable intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization or asset impairment. Refer to Note 7 for additional information on goodwill and other intangible assets. Impairment of Long-Lived Assets: Long-lived assets with identifiable cash flows are reviewed for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Retail store long-lived assets are regularly reviewed for impairment indicators. Impairment is assessed at the individual store level which is the lowest level of identifiable cash flows and considers the estimated undiscounted cash flows over the asset’s remaining life. If estimated undiscounted cash flows are insufficient to recover the investment, an impairment loss is recognized equal to the difference between the estimated fair value of the asset and its carrying value, net of salvage, and any costs of disposition, and allocated to the asset groups at the store level based on their relative fair values. The fair value estimate is generally the discounted amount of estimated store-specific cash flows. Facility Closure and Severance Costs: Retail store performance is regularly reviewed against expectations and retail stores not meeting performance requirements may be closed. Retail stores are also closed as part of restructuring activities which aim to optimize the Company’s retail footprint. Refer to Note 2 for additional information on the restructuring programs and associated store closures. Costs associated with facility closures, principally accrued lease costs, are recognized when the facility is no longer used in an operating capacity or when a liability has been incurred. Retail store assets, including operating lease right-of-use (“ROU”) assets, are also reviewed for possible impairment, or reduction of estimated useful lives. The Company recognizes charges or credits to adjust remaining closed facility accruals to reflect current expectations. Adjustments to facility closure costs are presented in the Consolidated Statements of Operations in Selling, general and administrative expenses if the related facility was closed as part of ongoing operations or in Merger, restructuring and other operating expenses, net, if the related facility was closed as part of a merger integration plan or restructuring plan. Refer to Note 2 for additional information on accrued expenses relating to closed facilities. The short-term and long-term components of this liability are included in Accrued expenses and other current liabilities and Deferred income taxes and other long-term liabilities, respectively, in the Consolidated Balance Sheets. Employee termination costs covered under written and substantive plans are accrued when probable and estimable and consider continuing service requirements, if any. Additionally, incremental one-time employee benefit costs are recognized when the key terms of the arrangements have been communicated to affected employees. Amounts are recognized when communicated or over the remaining service period, based on the terms of the arrangements. Accrued Expenses and Other Current Liabilities: The major components of Accrued expenses and other current liabilities in the Consolidated Balance Sheets are tax liabilities, payroll and benefit accruals, customer rebates accruals, inventory receipts accruals and current portion of operating lease liabilities. Accrued payroll and benefits were $158 million and $148 million at December 31, 2022 and December 25, 2021, respectively. Fair Value of Financial Instruments: The Company measures fair value 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. In developing its fair value estimates, the Company uses the following hierarchy: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3 Significant unobservable inputs that are not corroborated by market data. Generally, these fair value measures are model-based valuation techniques such as discounted cash flows or option pricing models using own estimates and assumptions or those expected to be used by market participants. The fair values of cash and cash equivalents, receivables, trade accounts payable and accrued expenses and other current liabilities approximate their carrying values because of their short-term nature. Refer to Note 13 for further fair value information. Revenue Recognition: Revenue includes the sale of: - Supplies such as paper, writing instruments, office supplies, cleaning and breakroom items, personal protective equipment, and product subscriptions; - Technology related products such as toner and ink, printers, computers, tablets and accessories, electronic storage, and sales of third-party software, as well as technology support services offerings provided in the Company’s retail stores, such as installation and repair; - Furniture and other products such as desks, seating, luggage, gift cards and warranties, as well as supply chain services and e-procurement platform offerings; and - Copy and print services, including managed print and fulfillment services. The Company sells its supplies, furniture and other products through its ODP Business Solutions and Office Depot Divisions. Supply chain services are provided through its Veyer Division, and e-procurement platform fees are generated through its Varis Division. Customers can purchase products through the Company’s call centers, electronically through its Internet websites, or through its retail stores. Revenues from supplies, technology, and furniture and other product sales are recognized when the customer obtains control of the Company’s product, which occurs at a point in time, typically upon delivery to the customer. Furniture also includes arrangements where customers can make special furniture interior design and installation orders that are customized to their needs. The performance obligations related to these arrangements are satisfied over time. Substantially all of the Company’s copy and print and technology support services offerings are satisfied at a point in time and revenue is recognized as such. The majority of copy and print offerings, which includes printing, copying, and digital imaging, are fulfilled through retail stores and the related performance obligations are satisfied within a short period of time (generally within the same day). Significant Judgments Revenue is recognized upon transfer of control of promised products or services to customers for an amount that reflects the consideration the Company is entitled to receive in exchange for those products or services. For product sales, transfer of control occurs at a point in time, typically upon delivery to the customer. For service offerings, the transfer of control and satisfaction of the performance obligation is either over time or at a point in time. When performance obligations are satisfied over time, the Company evaluates the pattern of delivery and progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Revenue is recognized net of allowance for returns and net of any taxes collected from customers, which are subsequently remitted to governmental authorities. Shipping and handling costs are considered fulfillment activities and are recognized within the Company’s cost of goods sold. Contracts with customers could include promises to transfer multiple products and services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. Determining the standalone selling price also requires judgment. The Company did not have significant revenues generated from such contracts in 2022, 2021 and 2020. Products are generally sold with a right of return and the Company may provide other incentives, such as rebates and coupons, which are accounted for as variable consideration when estimating the amount of revenue to recognize. The Company estimates returns and incentives at contract inception and includes the amount in the transaction price for which significant reversal is not probable. These estimates are updated at the end of each reporting period as additional information becomes available. The Company offers a customer loyalty program that provides customers with rewards that can be applied to future purchases or other incentives. Loyalty rewards are accounted for as a separate performance obligation and deferred revenue is recorded in the amount of the transaction price allocated to the rewards, inclusive of the impact of estimated breakage. The estimated breakage of loyalty rewards is based on historical redemption rates experienced under the loyalty program. Revenue is recognized when the loyalty rewards are redeemed or expire. As December 31, 2022 and December 25, 2021 , the Company had $ 15 million and $ 12 million , respectively, of deferred revenue related to the loyalty program, which is included in Accrued expenses and other current liabilities in the Consolidated Balance Sheets. The Company recognizes revenue in certain circumstances before product delivery occurs (commonly referred to as bill-and-hold transactions). Revenue from bill-and-hold transactions is recognized when all specific requirements for transfer of control under a bill-and-hold arrangement have been met which include, among other things, a request from the customer that the product be held for future scheduled delivery. For these bill-and-hold arrangements, the associated product inventory is identified separately as belonging to the customer and is ready for physical transfer. Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers. A receivable is recognized in the period the Company delivers goods or provides services, and is recorded at the invoiced amount. A receivable is also recognized for unbilled services where the Company’s right to consideration is unconditional, and is recorded based on an estimate of time and materials. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 20 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that the contracts do not include a significant financing component. The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing its products and services. The Company receives payments from customers based upon contractual billing schedules. Contract assets include amounts related to deferred contract acquisition costs (refer to the section “Costs to Obtain a Contract” below) and if applicable, the Company’s conditional right to consideration for completed performance under a contract. The short- and long-term components of contract assets in the table below are included in Prepaid expenses and other current assets, and Other assets, respectively, in the Consolidated Balance Sheets. Contract liabilities include payments received in advance of performance under the contract, which are recognized as revenue when the performance obligation is completed under the contract, as well as accrued contract acquisition costs, liabilities related to the Company’s loyalty program and gift cards. The short- and long-term components of contract liabilities in the table below are included in Accrued expenses and other current liabilities, and Deferred income taxes and other long-term liabilities, respectively, in the Consolidated Balance Sheets. The following table provides information about receivables, contract assets and contract liabilities from contracts with customers: December 31, December 25, (In millions) 2022 2021 Trade receivables, net $ 412 $ 353 Short-term contract assets 8 16 Long-term contract assets 2 8 Short-term contract liabilities 41 52 Long-term contract liabilities — 2 In 2022 and 2021, the Company did not There were no contract assets and liabilities that were recognized in 2022 as a result of business combinations. Included in the table above are short- and long-term contract assets of $1 million as of December 25, 2021, related to CompuCom, which are presented as part of assets held for sale in the Consolidated Balance Sheets. Also included in the table above are short- and long-term contract liabilities of $10 million and $2 million, respectively, as of December 25, 2021 related to CompuCom, which are presented as part of liabilities held for sale in the Consolidated Balance Sheets. A majority of the purchase orders and statements of work related to contracts with customers require delivery of the product or service within one year or less. For certain service contracts that exceed one year, the Company recognizes revenue at the amount to which it has the right to invoice for services performed. Accordingly, the Company has applied the optional exemption provided by the new revenue recognition standard relating to unsatisfied performance obligations and does not disclose the value of unsatisfied performance obligations for its contracts. Costs to Obtain a Contract The Company recognizes an asset for the incremental costs of obtaining a contract with a customer if it expects the benefit of those costs to be longer than one year. The Company has determined that certain rebate incentive programs meet the requirements to be capitalized. These costs are periodically reviewed for impairment and are amortized on a straight-line basis over the expected period of benefit. As of December 31, 2022 and December 25, 2021, short-term contract assets and long-term contract assets in the table above represent T here is uncertainty regarding the impacts of COVID-19 on the global and national economies, which could negatively affect the Company’s customers and result in future impairments of contract assets. Cost of Goods Sold and Occupancy Costs: Cost of goods sold and occupancy costs include: - inventory costs (as discussed above); - outbound freight; - employee and non-employee receiving, distribution, and occupancy costs (rent), including depreciation, real estate taxes and common area costs, of inventory-holding and selling locations; and - identifiable employee-related costs associated with services provided to customers. Selling, General and Administrative Expenses: Selling, general and administrative expenses include amounts incurred related to expenses of operating and support functions, including: - employee payroll and benefits, including variable pay arrangements; - advertising; - store and field support; - executive management and various staff functions, such as information technology, human resources functions, finance, legal, internal audit, and certain merchandising and product development functions; - other operating costs incurred relating to selling activities; and - closed defined benefit pension and postretirem |
MERGER, RESTRUCTURING AND OTHER
MERGER, RESTRUCTURING AND OTHER ACTIVITY | 12 Months Ended |
Dec. 31, 2022 | |
Merger Restructuring And Other Activity [Abstract] | |
MERGER, RESTRUCTURING AND OTHER ACTIVITY | NOTE 2. MERGER, RESTRUCTURING AND OTHER ACTIVITY The Company has taken actions to optimize its asset base and drive operational efficiencies. These actions include acquiring profitable businesses, closing underperforming retail stores and non-strategic distribution facilities, consolidating functional activities, eliminating redundant positions and disposing of non-strategic businesses and assets. The expenses and any income recognized directly associated with these actions are included in Merger, restructuring and other operating expenses, net on a separate line in the Consolidated Statements of Operations in order to identify these activities apart from the expenses incurred to sell to and service customers. These expenses are not included in the determination of Division operating income. The table below summarizes the major components of Merger, restructuring and other operating expenses, net. (In millions) 2022 2021 2020 Merger and transaction related expenses Transaction and integration (7 ) — 4 Facility closure, contract termination and other expenses, net — — 1 Total Merger and transaction related expenses (7 ) — 5 Restructuring expenses Severance (13 ) (2 ) 41 Professional fees — 1 21 Facility closure, contract termination, and other expenses, net 5 15 35 Total Restructuring expenses, net (8 ) 14 97 Other operating expenses Professional fees 54 37 — Total Other operating expenses 54 37 — Total Merger, restructuring and other operating expenses, net $ 39 $ 51 $ 102 MERGER AND TRANSACTION RELATED EXPENSES In 2022, the Company recognized $7 million income related to earn-out adjustment on the acquisition of BuyerQuest Holdings, Inc. The Company did not incur any additional transaction and integration expenses in 2022. The Company also did not incur any merger and transaction related expenses in 2021. In 2020, the Company incurred $5 million of merger and transaction related expenses. Transaction and integration include legal, accounting, and other third-party expenses, and earn-out adjustments, incurred in connection with acquisitions and business integration activities. Facility closure, contract termination, and other expenses, net relate to facility closure accruals, contract termination costs, gains and losses on asset dispositions, and accelerated depreciation. RESTRUCTURING EXPENSES Maximize B2B Restructuring Plan In May 2020, the Company’s Board of Directors approved a restructuring plan to re-align the Company’s operational focus to support its “business-to-business” solutions and IT services business units and improve costs (“Maximize B2B Restructuring Plan”). Implementation of the Maximize B2B Restructuring Plan was expected to be substantially completed by the end of 2023. The Maximize B2B Restructuring Plan aims to generate savings through optimizing the Company’s retail footprint, removing costs that directly support the Retail business and additional measures to implement a company-wide low-cost business model, which will then be invested in accelerating the growth of the Company’s business-to-business platform. In December 2022, the Company’s Board of Directors approved to extend the program through 2024, as a result of the delays in executing the program in 2021 and 2022 associated with the previously planned separation of the consumer business. With the decision to maintain all businesses under common ownership, described above in Note 1, the Company will continue with the execution of the Maximize B2B Restructuring Plan as previously planned and therefore has extended the program through 2024. The Company cl osed 56 retail stores under the Maximize B2B Restructuring Plan in 2022 . The Company had closed 181 retail stores and two distribution facilities in 2021 and 2020 under the Maximize B2B Restructuring Plan. It is anticipated that additional retail stores will be closed in 2023 and 2024, however, it is generally understood that closures will approximate the store’s lease termination date. In 2022 had $8 million of income associated with the Maximize B2B Restructuring Plan which consisted of $5 million in facility closures, contract termination and other costs, more than offset by $13 million in reversals of employee severance accruals due to changes The facility closure costs were mainly related to retail store closure accruals and accelerated depreciation. In 2022, the Company made cash payments of $8 million associated with expenditures for the Maximize B2B Restructuring Plan. Since its inception in 2020, the Company incurred $81 million in restructuring expenses to implement the Maximize B2B Restructuring Plan through 2022 for its continuing operations, of which $61 million were cash expenditures. to $ 95 million. Other Included in restructuring expenses in 2020 are $19 million in costs incurred in connection with the Business Acceleration Program. These costs included third-party professional fees, retail and facility closure costs and other costs. The Business Acceleration Program was announced in 2019 and largely concluded at the end of 2020. Restructuring expenses in 2020 also included $3 million in third-party professional fees incurred in connection with the Reorganization. Asset impairments related to the restructuring initiatives are not included in the table above. Refer to Note 13 for further information. OTHER OPERATING EXPENSES Other operating expenses represent costs incurred that are incremental to those related to running the Company’s core operations, which are presented within Selling, general and administrative expenses on the Consolidated Statements of Operations. As described in Note 1 above, the Company had been evaluating the separation of its consumer business, first through a spin-off and subsequently through a potential sale. On June 21, 2022, the Company’s Board of Directors, with the assistance of its financial and legal advisors, completed its review of both proposals received by the Company to acquire its consumer business and unanimously determined it to be in the best interests of the Company and its shareholders not to divest the consumer business at this time. Further, due to current market conditions, the Company’s Board of Directors also determined not to resume the Company’s previously planned separation of its consumer business at this time and instead to maintain all of its businesses under common ownership. The Company incurred $33 million in third-party professional fees in year-to-date 2022 related to separation activities, which was all incurred in the first half of 2022. The Company had incurred $32 million in third-party professional fees associated with separation activities in 2021. Also as described in Note 1 above, during the third quarter of 2022, the Company re-aligned its operations into four Divisions, which also represent its new reportable segments. The Company incurred $21 million in third-party professional fees in connection with the re-alignment in 2022, which was all incurred in the second half of 2022. At December 31, 2022, the Company is substantially complete with activities related to the re-alignment. The costs incurred in the second half of 2022 represent trailing costs to complete activities that were previously started as part of the separation process discussed above and leveraged to achieve the re-alignment. The Company does not expect to have a re-alignment of its businesses in the future. Accordingly, the Company has presented the costs associated with the re-alignment as Other operating expenses, as they represent incremental operating expenses that are not part of its core costs to support its operations. Other operating expenses in 2021 also included $5 million of third-party professional fees incurred related to the evaluation of USR Parent, Inc.’s proposals received during the first half of 2021. MERGER AND RESTRUCTURING ACCRUALS The activity in the merger and restructuring accruals in 2022 and 2021 is presented in the table below. Certain merger and restructuring charges are excluded from the table because they are paid as incurred or non-cash, such as accelerated depreciation and gains and losses on asset dispositions. (In millions) Beginning Balance Charges Incurred Cash Payments Ending Balance 2022 Termination benefits: Maximize B2B Restructuring Plan 19 (13 ) (1 ) 5 Lease and contract obligations, accruals for facilities closures and other costs: Maximize B2B Restructuring Plan 6 5 (7 ) 4 Comprehensive Business Review 1 — — 1 Previously planned separation of consumer business and re-alignment 2 52 (52 ) 2 Total $ 28 $ 44 $ (60 ) $ 12 2021 Termination benefits: Maximize B2B Restructuring Plan 27 (2 ) (6 ) 19 Business Acceleration Program 2 — (2 ) — Lease and contract obligations, accruals for facilities closures and other costs: Maximize B2B Restructuring Plan 10 9 (13 ) 6 Business Acceleration Program 1 — (1 ) — Comprehensive Business Review 2 — (1 ) 1 USR Parent, Inc. proposals — 5 (5 ) — Planned separation of consumer business — 32 (30 ) 2 Total $ 42 $ 44 $ (58 ) $ 28 The short-term and long-term components of these liabilities are included in Accrued expenses and other current liabilities and Deferred income taxes and other long-term liabilities, respectively, in the Consolidated Balance Sheets. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 3. SEGMENT INFORMATION During the third quarter of 2022, the Company re-aligned its operations into its consumer business named Office Depot, and three distinct B2B business and digital segments which are ODP Business Solutions, Veyer and Varis. The decision to re-align was driven by how the Company is looking at its products and offerings and serving its customers. How the Company’s customers work and interact has changed, where businesses demand a wider range of products and services, and a more modern digital environment in which to operate, and consumers demand an omni-channel retail experience. In addition, dependable supply chain operations have become increasingly important in meeting these demands. The Company performed a full strategic review of its operations in light of these factors and determined that completing the re-alignment of its operations in this manner enables the Company to better focus on its customers by being in a better position to meet a wider array of customer needs for product, service, and omni-channel choices. The Company also determined that the re-alignment provides for greater accountability internally for product and service outcomes, customer experiences, capital allocations, and pursuing strategic opportunities. The re-alignment resulted in a change in the Company’s reportable segments. In addition, management of the Company also changed how it analyzes these businesses, which resulted in the inclusion of certain corporate costs, mainly payroll related, previously excluded from segment profitability measures. The Company accounts for intersegment sales and transfers as if the sales or transfers were to third parties. The changes to its reportable segments did not impact the Company’s current Consolidated Financial Statements. Prior period amounts, including interim periods, have been recast to conform to the current presentation. These changes have no impact on previously reported Consolidated Balance Sheets, Statements of Operations, Statements of Comprehensive Income, Statements of Stockholders’ Equity, or Statements of Cash Flows. A t December 31, 2022, the Company had four reportable segments: ODP Business Solutions Division – The Company’s leading B2B distribution solutions provider serving small, medium and enterprise level companies , including those in the public and education sectors . This segment includes the contract sales channel of the Company’s previous Business Solutions Division, and operates in the United States, Puerto Rico, the U.S. Virgin Islands, and Canada. The ODP Business Solutions Division sells nationally branded, as well as the Company’s private branded, office supply and adjacency products and services to customers, who are served through a dedicated sales force, catalogs, telesales, and electronically through the Company’s Internet websites. Adjacency products and services include cleaning, janitorial, and breakroom supplies, office furniture, technology products, and copy and print services. This segment also includes our Federation entities, which are over a dozen regional office supply distribution businesses acquired by the Company as part of its transformation to expand its reach and distribution network into geographic areas that were previously underserved, and which continue to operate under their own brand names. The acquisition of these businesses has allowed for an effective and accretive means to expand our distribution reach, target new business customers and grow our offerings beyond traditional office supplies. Office Depot Division – The Company’s leading provider of retail consumer and small business products and services distributed through a fully integrated omni-channel platform of 980 Office Depot and OfficeMax retail locations in the United States, Puerto Rico and the U.S. Virgin Islands, and an eCommerce presence (www.officedepot.com). The Office Depot Division sells office supplies, technology products and solutions, business machines and related supplies, cleaning, breakroom and facilities products, personal protective equipment, and office furniture as well as offering business services including copying, printing, digital imaging, mailing, shipping and technology support services. In addition, the print needs for retail and business customers are facilitated through the Company’s regional print production centers Veyer Division – The Company’s supply chain, distribution, procurement and global sourcing operation, which has over 35 years of experience with proven leadership and has been branded under a new name . The Veyer Division specializes in B2B and consumer business service delivery, with core competencies in distribution, fulfillment, transportation, global sourcing and purchasing. The Veyer Division’s customers include our Office Depot Division and ODP Business Solutions Division, as well as third-party customers. The Veyer Division also includes the Company’s global sourcing operations in Asia. Varis Division – The Company’s tech-enabled B2B indirect procurement marketplace, which provides a better way for buyers and suppliers to transact through the platform’s consumer-like buying experience, advanced spend management tools, network of suppliers, and technology capabilities. In connection with the Company’s development efforts of this Division, it acquired BuyerQuest Holdings, Inc. (“BuyerQuest”) in 2021, a software as a service eProcurement platform company. BuyerQuest’s operating results are included in the operating results for Varis Division. Varis Division currently serves enterprise businesses and provides its services to middle- and small-sized businesses. It is focused on filling the growing demand for a B2B centric digital commerce platform that is modern, trusted, and provides the procurement controls and visibility businesses require to operate. The Company sold its CompuCom Division through a single disposal group on December 31, 2021, which is presented as discontinued operations for all periods presented. Refer to Note 15 for additional information. Division operating income is determined based on the measure of performance reported internally to manage the business and for resource allocation. This measure charges to the respective Divisions those expenses considered directly or closely related to their operations and allocates support costs. Certain operating expenses and credits are not allocated to the Divisions, including asset impairments and merger, restructuring and other operating expenses, as well as expenses and credits retained at the Corporate level, including certain management costs and legacy pension and environmental matters. Other companies may charge more or less of these items to their segments and results may not be comparable to similarly titled measures used by other entities. The following is a summary of sales and operating income (loss) by each of the Divisions, reconciled to consolidated totals: (In millions) ODP Business Solutions Division Office Depot Division Veyer Division Varis Division Eliminations Total 2022 Sales (external) $ 4,005 $ 4,451 $ 28 $ 7 $ - $ 8,491 Sales (internal) 19 36 5,855 - (5,910 ) — Total sales $ 4,024 $ 4,487 $ 5,883 $ 7 $ (5,910 ) $ 8,491 Division operating income (loss) $ 140 $ 285 $ 28 $ (66 ) $ - $ 387 2021 Sales (external) $ 3,602 $ 4,830 $ 28 $ 5 $ - $ 8,465 Sales (internal) 24 34 5,963 - (6,021 ) - Total sales $ 3,626 $ 4,864 $ 5,991 $ 5 $ (6,021 ) $ 8,465 Division operating income (loss) $ 72 $ 325 $ 30 $ (34 ) $ - $ 393 2020 Sales (external) $ 3,549 $ 5,300 $ 23 $ - $ - $ 8,872 Sales (internal) 29 35 6,321 - (6,385 ) - Total sales $ 3,578 $ 5,335 $ 6,344 $ - $ (6,385 ) $ 8,872 Division operating income (loss) $ 51 $ 317 $ 28 $ - $ - $ 396 A reconciliation of the measure of Division operating income to Consolidated income (loss) from continuing operations before income taxes is as follows: (In millions) 2022 2021 2020 Division operating income $ 387 $ 393 $ 396 Add/(subtract): Asset impairments (14 ) (20 ) (182 ) Merger, restructuring and other operating expenses, net (39 ) (51 ) (102 ) Unallocated expenses (91 ) (88 ) (106 ) Interest income 5 1 4 Interest expense (16 ) (28 ) (42 ) Loss on extinguishment and modification of debt — — (12 ) Other income, net 10 24 6 Income (loss) from continuing operations before income taxes $ 242 $ 231 $ (38 ) The following table provides information about disaggregated sales by major categories: (In millions) 2022 2021 2020 Major sales categories Supplies $ 4,144 $ 3,815 $ 4,006 Technology 2,461 2,758 3,014 Furniture and other 1,255 1,302 1,281 Copy and print 631 590 571 Total $ 8,491 $ 8,465 $ 8,872 The following table provides information about other significant balances by each of the Divisions, reconciled to consolidated totals: (In millions) ODP Business Solutions Division Office Depot Division Veyer Division Varis Division Corporate and Discontinued Operations* Consolidated Total 2022 Capital expenditures $ 5 $ 14 $ 20 $ 44 $ 16 $ 99 Depreciation and amortization 21 56 37 13 4 131 Assets 749 1,553 993 130 724 4,149 2021 Capital expenditures 5 15 22 14 17 73 Depreciation and amortization 24 67 40 4 11 146 Assets 654 1,728 1,038 83 1,362 4,865 2020 Capital expenditures 8 25 19 — 6 58 Depreciation and amortization 21 75 49 — 12 157 * Amounts included in “Corporate and Discontinued Operations” consist of (i) assets (including all cash and cash equivalents) and depreciation related to corporate activities and shared services of continuing operations, and (ii) assets of discontinued operations amounting to $469 million at December 25, 2021. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 4. INCOME TAXES The components of income (loss) from continuing operations before income taxes consisted of the following: (In millions) 2022 2021 2020 United States $ 226 $ 173 $ (30 ) Foreign 16 58 (8 ) Total income (loss) from continuing operations before income taxes $ 242 $ 231 $ (38 ) The income tax expense (benefit) related to income (loss) from continuing operations consisted of the following: (In millions) 2022 2021 2020 Current: Federal $ 26 $ 14 $ (7 ) State (4 ) 8 17 Foreign 7 5 4 Deferred: Federal 27 13 19 State 10 2 (5 ) Foreign (2 ) 2 (3 ) Total income tax expense $ 64 $ 44 $ 25 The following is a reconciliation of income taxes at the U.S. Federal statutory rate to the provision for income taxes: (In millions) 2022 2021 2020 Federal tax computed at the statutory rate $ 51 $ 48 $ (8 ) State taxes, net of Federal benefit 11 10 4 Foreign income taxed at rates other than Federal 2 (5 ) 4 Increase (decrease) in valuation allowance — (3 ) (3 ) Non-deductible Goodwill impairments — — 24 Other non-deductible expenses and settlements 4 5 4 FIN 48 adjustments (2 ) — — Non-taxable income and additional deductible expenses (1 ) (3 ) (3 ) Impact of stock compensation (windfall)/shortfall (3 ) (6 ) 2 State NOL expirations 2 — — Other items, net — (2 ) 1 Income tax expense $ 64 $ 44 $ 25 During 2022 and 2021, the mix of income and losses across jurisdictions, although still applicable, has become less of a factor in influencing the Company’s effective tax rates due to limited international operations and improved operating results. The Company’s effective tax rates were 26%, 19% and (66)% in 2022, 2021 and 2020, respectively. In 2022, the Company’s effective tax rate was primarily impacted by the recognition of a tax windfall associated with stock-based compensation. This factor, along with the impact of state taxes and the mix of income and losses across U.S. and non-U.S. jurisdictions, caused the Company’s effective tax rate of 26% for 2022 to differ from the statutory rate of 21%. The Company’s effective tax rate for prior periods has varied considerably primarily due to the impact of goodwill impairment, state taxes, stock-based compensation awards, recognition of tax benefits due to an agreement reached with the IRS related to a prior tax position, certain nondeductible items and the mix of income and losses across U.S. and non-U.S. jurisdictions. Changes in pretax income projections and the mix of income across jurisdictions could impact the effective tax rates in future quarters. The Company continues to have a U.S. valuation allowance for certain U.S. Federal credits and state tax attributes, which relate to deferred tax assets that require either certain types of income or for income to be earned in certain jurisdictions in order to be realized. The Company will continue to assess the realizability of its deferred tax assets in the U.S. and remaining foreign jurisdictions in future periods. Changes in pretax income projections could impact this evaluation in future periods. The Company operates in several foreign jurisdictions with income tax rates that differ from the U.S. Federal statutory rate, which resulted in an expense for 202 2 presented in the effective tax rate reconciliation. Significant foreign tax jurisdictions for which the Company realized such expense are Canada and Puerto Rico . The components of deferred income tax assets and liabilities consisted of the following: December 31, December 25, (In millions) 2022 2021 U.S. and foreign loss carryforwards $ 277 $ 61 Operating lease right-of-use assets 262 273 Pension and other accrued compensation 35 47 Basis difference in subsidiary held for sale — 23 Accruals for facility closings 2 2 Inventory 10 7 Self-insurance accruals 13 14 Deferred revenue 9 10 U.S. and foreign income tax credit carryforwards 38 70 Allowance for bad debts 4 5 Accrued expenses 14 18 Basis difference in fixed assets 43 36 Internally developed software 1 — Gross deferred tax assets 708 566 Valuation allowance (266 ) (93 ) Deferred tax assets 442 473 Internal software — 2 Operating lease liabilities 244 251 Intangibles 12 5 Undistributed foreign earnings 5 — Deferred tax liabilities 261 258 Net deferred tax assets $ 181 $ 215 As of December 31, 2022, and December 25, 2021, deferred income tax liabilities amounting to $2 million and $4 million, respectively, are included in deferred income taxes and other long-term liabilities. As of December 31, 2022, the Company has utilized all of its U.S. Federal net operating loss (“NOL”) carryforwards. The Company has $238 million of foreign and $636 million of state NOL carryforwards. Of the state NOL carryforwards, $20 million will expire in 2023 and the remaining balance will expire between 2024 and 2041. The Company recognized a capital loss on the sale of CompuCom of $841 million, $94 million of which will be carried back to 2020 and 2021 resulting in an expected refund of $23 million. The remaining capital loss carryforward of $747 million will be offset by a valuation allowance until such time as the Company is able to utilize the losses. Additionally, the Company has $27 million of U.S. Federal tax credit carryforwards, which expire in 2023 and 2024, and $11 million of state and foreign tax credit carryforwards, $2 million of which can be carried forward indefinitely, and the remainder of which will expire between 2023 and 2028. As of December 31, 2022, the Company has not triggered an “ownership change” as defined in Internal Revenue Code Section 382 or other similar provisions that would limit the use of NOL and tax credit carryforwards. However, if the Company were to experience an ownership change in future periods, its deferred tax assets and income tax expense may be negatively impacted. Deferred income taxes have been provided on all undistributed earnings of foreign subsidiaries. The following summarizes the activity related to valuation allowances for deferred tax assets: (In millions) 2022 2021 2020 Beginning balance $ 93 $ 99 $ 100 Additions, charged to expense 184 — 2 Reductions (11 ) (6 ) (3 ) Ending balance $ 266 $ 93 $ 99 The Company’s valuation allowance increased in 2022 due to the valuation allowance related to the capital loss on the sale of CompuCom and decreased during 2022, 2021 and 2020 due to the expiration of certain credits for which a valuation allowance had been established. As of December 31, 2022, the Company continues to have a U.S. valuation allowance for certain U.S. Federal credits and certain state tax attributes, which relate to deferred tax assets that require either certain types of income or for income to be earned in certain jurisdictions in order to be realized. The Company will continue to assess the realizability of its deferred tax assets in the U.S. and remaining foreign jurisdictions in future periods. Changes in pretax income projections could impact this evaluation in future periods. The following table summarizes the activity related to unrecognized tax benefits: (In millions) 2022 2021 2020 Beginning balance $ 13 $ 13 $ 13 Decrease related to prior year tax positions (3 ) — — Ending balance $ 10 $ 13 $ 13 Included in the balance of $10 million at December 31, 2022, is $6 million of unrecognized tax benefits that, if recognized, would impact the effective tax rate. The other $4 million primarily results from tax positions that, if sustained, would be offset by changes in deferred tax assets. During 2022, the Company increased the unrecognized tax benefits by $1 million related to a foreign tax filing and reduced the unrecognized tax benefits by $4 million related to the expiration of certain jurisdictional statues of limitations. It is anticipated that $2 million of the material tax positions will be resolved within the next 12 months. Additionally, the Company anticipates that it is reasonably possible that new issues will be raised or resolved by tax authorities that may require changes to the balance of unrecognized tax benefits; however, an estimate of such changes cannot be reasonably made. The Company recognizes interest related to unrecognized tax benefits in interest expense and penalties in the provision for income taxes. The Company recognized immaterial interest and penalty expense in 2022, 2021 and 2020. The Company had approximately $4 million accrued for the payment of interest and penalties as of December 31, 2022. The Company files a U.S. Federal income tax return and other income tax returns in various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. Federal and state and local income tax examinations for years before 2020 and 2017, respectively. The acquired OfficeMax U.S. consolidated group is no longer subject to U.S. Federal income tax examination and with few exceptions, is no longer subject to U.S. state and local income tax examinations for years before 2017. The U.S. Federal income tax returns for 2021 are currently under review. Generally, the Company is subject to routine examination for years 2017 and forward in its international tax jurisdictions. |
EARNINGS (LOSS) PER SHARE
EARNINGS (LOSS) PER SHARE | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
EARNINGS (LOSS) PER SHARE | NOTE 5. EARNINGS (LOSS) PER SHARE The following table presents the calculation of net earnings (loss) per common share — basic and diluted: (In millions, except per share amounts) 2022 2021 2020 Basic Earnings (Loss) Per Share Numerator: Net income (loss) from continuing operations $ 178 $ 187 $ (63 ) Loss from discontinued operations, net of tax (12 ) (395 ) (256 ) Net income (loss) $ 166 $ (208 ) $ (319 ) Denominator: Weighted-average shares outstanding 48 53 53 Basic earnings (loss) per share: Continuing operations $ 3.73 $ 3.54 $ (1.20 ) Discontinued operations (0.25 ) (7.47 ) (4.85 ) Net basic earnings (loss) per share $ 3.48 $ (3.93 ) $ (6.05 ) Diluted Earnings (Loss) Per Share Numerator: Net income (loss) from continuing operations $ 178 $ 187 $ (63 ) Loss from discontinued operations, net of tax (12 ) (395 ) (256 ) Net income (loss) $ 166 $ (208 ) $ (319 ) Denominator: Weighted-average shares outstanding 48 53 53 Effect of dilutive securities: Stock options and restricted stock 1 2 — Diluted weighted-average shares outstanding 49 55 53 Diluted earnings (loss) per share Continuing operations $ 3.61 $ 3.42 $ (1.20 ) Discontinued operations (0.24 ) (7.21 ) (4.85 ) Net diluted earnings (loss) per share $ 3.37 $ (3.79 ) $ (6.05 ) Awards of stock options and nonvested shares representing additional shares of outstanding common stock were less than 1 million, 1 million and 2 million for the fiscal years ended December 31, 2022, December 25, 2021 and December 26, 2020, respectively, but were not included in the computation of diluted weighted-average shares outstanding because their effect would have been antidilutive. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 12 Months Ended |
Dec. 31, 2022 | |
Property Plant And Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | NOTE 6. PROPERTY AND EQUIPMENT Property and equipment consists of: December 31, December 25, (In millions) 2022 2021 Land $ 30 $ 45 Buildings 79 200 Computer software 764 693 Leasehold improvements 565 587 Furniture, fixtures and equipment 753 775 Construction in progress 17 12 2,208 2,312 Less accumulated depreciation (1,856 ) (1,835 ) Total $ 352 $ 477 The above table of property and equipment includes assets held under finance leases as follows: December 31, December 25, (In millions) 2022 2021 Buildings $ 11 $ 19 Furniture, fixtures and equipment 143 143 154 162 Less accumulated depreciation (125 ) (123 ) Total $ 29 $ 39 Depreciation expense was $75 million in 2022, $88 million in 2021 and $101 million in 2020. Included in computer software and construction in progress above are capitalized software costs of $773 million and $699 million at December 31, 2022 and December 25, 2021, respectively. The unamortized amounts of the capitalized software costs are $145 million and $115 million at December 31, 2022 and December 25, 2021, respectively. Amortization of capitalized software costs totaled $47 million, $49 million and $50 million in 2022, 2021 and 2020, respectively. Software development costs that do not meet the criteria for capitalization are expensed as incurred. Estimated future amortization expense related to capitalized software at December 31, 2022 is as follows: (In millions) 2023 $ 45 2024 38 2025 31 2026 21 2027 9 Thereafter 1 The weighted average remaining amortization period for capitalized software is 4 years. Assets Held for Sale The Company’s corporate headquarters in Boca Raton met the criteria to be classified as held for sale during the third quarter of 2022. The asset was measured at the lower of its carrying amount or estimated fair value less costs to sell upon classification to held for sale, which was $104 million, and did not result in any valuation reserve being recorded. Accordingly, the Company presented its corporate headquarters in Boca Raton within current assets held for sale in the Consolidated Balance Sheets as of December 31, 2022. The Company has entered into an agreement in principle with a third-party buyer to sell this facility. The completion of the sales transaction, which is expected to occur in the first half of 2023, is subject to various conditions, including an intention for the Company to lease back a portion of the building’s office space from the new owner. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | NOTE 7. GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL Goodwill and indefinite-lived intangible assets are tested for impairment annually as of the first day of fiscal December or more frequently when events or changes in circumstances indicate that impairment may have occurred. The changes in reportable segments described in Note 3 also resulted in the change of the Company’s reporting units during the third quarter of 2022, where each reportable segment also represents a reporting unit. Goodwill was allocated to the new reporting units using their relative fair values. (In millions) Balance as of December 25, 2021 Allocation to New segment Balance as of December 31, 2022 Business Solutions Division $ 318 $ (318 ) $ — Retail Division 78 (78 ) — ODP Business Solutions Division — 142 142 Office Depot Division — 219 219 Veyer Division — 35 35 Varis Division 68 — 68 Total $ 464 $ — $ 464 The Company performed its fourth quarter 2022 annual goodwill impairment test using a quantitative assessment for its Varis reporting unit, and qualitative assessments for all other reporting units. The Varis reporting unit comprises the Varis segment. The quantitative assessment for Varis reporting unit combined the income approach and the market approach valuation methodologies and concluded that the fair value of this reporting unit exceeded its carrying amount. The fair value of the Varis reporting unit exceeded its carrying amount by 21%. The Varis reporting unit has been in operation since 2021, therefore the Company has less experience estimating the operating performance of this reporting unit. Changes to the critical assumptions used to estimate the fair value of this reporting unit, including changes in projected revenue growth rates, gross margin or expenses may result in a different calculation of fair value that could lead to the recognition of impairment charges in future periods. The Company will continue to evaluate the recoverability of goodwill at the reporting unit level on an annual basis and whenever events or changes in circumstances indicate there may be a potential impairment. If the operating results of the Company’s reporting units deteriorate in the future, it may cause the fair value of one or more of the reporting units to fall below their carrying value, resulting in additional goodwill impairment charges. INDEFINITE-LIVED INTANGIBLE ASSETS The Company had $13 million of trade names as of both December 31, 2022 and December 25, 2021. These indefinite-lived intangible assets are included in Other intangible assets, net in the Consolidated Balance Sheets. There were no impairments identified related to the trade names as part of the Company’s annual indefinite-lived intangible assets impairment test on the first day of fiscal month December in 2022. DEFINITE INTANGIBLE ASSETS Definite-lived intangible assets, which are included in Other intangible assets, net in the Consolidated Balance Sheets, are as follows: December 31, 2022 (In millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 122 $ (90 ) $ 32 Technology 6 (5 ) 1 Total $ 128 $ (95 ) $ 33 December 25, 2021 (In millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 122 $ (84 ) $ 38 Technology 6 (2 ) 4 Total $ 128 $ (86 ) $ 42 Definite-lived intangible assets generally are amortized using the straight-line method. The remaining weighted average amortization periods for customer relationships is 10 years. Amortization of intangible assets was $9 million in 2022, $9 million in 2021 and $6 million in 2020. Intangible assets amortization expenses are included in the Consolidated Statements of Operations in Selling, general and administrative expenses. Estimated future amortization expense for the intangible assets is as follows: (In millions) 2023 $ 5 2024 3 2025 3 2026 3 2027 3 Thereafter 16 Total $ 33 Definite-lived intangible assets are reviewed whenever events and circumstances indicate the carrying amount may not be recoverable and the remaining useful lives are appropriate. No impairment charges related to definite-lived intangible assets were recognized during 2022, 2021 and 2020 . |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 8. DEBT Debt consists of the following: December 31, December 25, (In millions) 2022 2021 Short-term borrowings and current maturities of long-term debt: Finance lease obligations $ 14 $ 17 Other current maturities of long-term debt 2 3 Total $ 16 $ 20 Long-term debt, net of current maturities: New Facilities loans under the Third Amended Credit Agreement, due 2025 57 100 Revenue bonds, due in varying amounts periodically through 2029 75 75 American & Foreign Power Company, Inc. 5% debentures, due 2030 15 15 Finance lease obligations 24 35 Other financing obligations 1 3 Total $ 172 $ 228 The Company was in compliance with all applicable covenants of existing loan agreements at December 31, 2022. THIRD AMENDED CREDIT AGREEMENT On April 17, 2020, the Company entered into the Third Amended and Restated Credit Agreement (the “Third Amended Credit Agreement”), which provided for a $1.2 billion asset-based revolving credit facility (the “Revolving Loan Facility”) and a $100 million asset-based first-in, last-out term loan facility (the “FILO Term Loan Facility”), for an aggregate principal amount of up to $1.3 billion (the “New Facilities”). The New Facilities mature on April 17, 2025. The Third Amended Credit Agreement replaced the Company’s then existing Amended Credit Agreement that was due to mature in May 2021. The Third Amended Credit Agreement also provides that the Revolving Loan Facility may be increased by up to $250 million, subject to certain terms and conditions, including increased commitments from existing or new lenders. As provided by the Third Amended Credit Agreement, available amounts that can be borrowed at any given time are based on percentages of certain outstanding accounts receivable, credit card receivables, inventory, cash value of company-owned life insurance policies, and certain specific real estate of the Company (the “Borrowing Base”). The Revolving Loan Facility included two sub-facilities of: (1) up to $1.150 billion which is available to the Company and certain of the Company’s domestic subsidiaries (which includes a letter of credit sub-facility of up to $400 million and a swingline loan sub-facility of up to $115 million); and (2) up to $50 million which is available to certain of the Company’s Canadian subsidiaries (which included a letter of credit sub-facility of up to $25 million and a swingline loan sub-facility of up to $5 million). Certain of the Company’s subsidiaries guarantee the obligations under the New Facilities (the “Guarantors”). All loans borrowed under the Revolving Loan Facility may be borrowed, repaid and reborrowed from time to time until the maturity date of April 17, 2025 as provided in the Third Amended Credit Agreement. The FILO Term Loan Facility, once repaid, may not be reborrowed. During the first quarter of 2022, the Company reduced its asset-based revolving credit facility by $ 200 million to $ 1.0 billion and retired $ 43 million of outstanding FILO Term Loan Facility loans under the Third Amended Credit Agreement. All amounts borrowed under the New Facilities, as well as the obligations of the Guarantors, are secured by a first priority lien on the Company’s and such Guarantors’ accounts receivables, inventory, cash, cash equivalents, deposit accounts, intercompany loan rights, certain pledged notes, certain life insurance policies, certain related assets, certain real estate and the proceeds thereof in each case. At the Company’s option, borrowings made pursuant to the Third Amended Credit Agreement bear interest at either, (i) the alternate base rate (defined as the higher of the Prime Rate (as announced by the agent), the Federal Funds Rate plus 1/2 of 1 The Third Amended Credit Agreement contains representations, warranties, affirmative and negative covenants, and default provisions which are conditions precedent to borrowing. The most significant of these covenants and default provisions include limitations in certain circumstances on acquisitions, dispositions, share repurchases and the payment of cash dividends. The New Facilities also include provisions whereby if the global availability is less than 12.5% of the Borrowing Base, the Company’s cash collections go first to the agent to satisfy outstanding borrowings. Further, if total availability falls below 10% of the Borrowing Base, a fixed charge coverage ratio test is required. Any event of default that is not cured within the permitted period, including non-payment of amounts when due, any debt in excess of $25 million becoming due before the scheduled maturity date, or the acquisition of more than 40% of the ownership of the Company by any person or group, within the meaning of the Securities and Exchange Act of 1934, could result in a termination of the New Facilities and all amounts outstanding becoming immediately due and payable. In 2020, the Company incurred approximately $6 million of new debt issuance costs under the Third Amended Credit Agreement, which will be recognized in interest expense through April 17, 2025, the maturity date of the New Facilities. At December 31, 2022, the Company had no revolving loans outstanding, $57 million of outstanding FILO Term Loan Facility loans, $41 million of outstanding standby letters of credit, and $856 million of available credit under the Third Amended Credit Agreement. OTHER SHORT- AND LONG-TERM DEBT As a result of the OfficeMax merger, the Company assumed the liability for the amounts in the table above on page 82 related to the (i) Revenue bonds, due in varying amounts periodically through 2029, and (ii) American & Foreign Power Company, Inc. 5% debentures, due 2030. Also, the Company has finance lease obligations which relate to buildings and equipment, and various other financing obligations for the amounts included in the table above on page 82. SCHEDULE OF DEBT MATURITIES Aggregate annual maturities of recourse debt, finance lease, and other financing obligations are as follows: (In millions) 2023 $ 18 2024 10 2025 64 2026 36 2027 33 Thereafter 30 Total 191 Less interest on finance leases (3 ) Total 188 Less: Current portion (16 ) Total long-term debt $ 172 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
LEASES | NOTE 9. LEASES The Company leases retail stores and other facilities, vehicles, and equipment under operating lease agreements. Facility leases typically are for a fixed non-cancellable term with one or more renewal options. In addition to rent payments, the Company is required to pay certain variable lease costs such as real estate taxes, insurance and common-area maintenance on most of the facility leases. For leases beginning in 2019, the Company accounts for lease components (e.g., fixed payments including rent) and non-lease components (e.g., real estate taxes, insurance costs and common-area maintenance costs) as a single lease component. Certain leases contain provisions for additional rent to be paid if sales exceed a specified amount, though such payments have been immaterial during the periods presented and are recognized as variable lease cost. The Company subleases certain real estate to third parties, consisting mainly of operating leases for retail stores. The components of lease expense were as follows: (In millions) 2022 2021 2020 Finance lease cost: Amortization of right-of-use assets $ 14 $ 18 $ 18 Interest on lease liabilities 2 3 4 Operating lease cost 334 350 402 Short-term lease cost 6 4 6 Variable lease cost 94 99 112 Sublease income (2 ) (2 ) (2 ) Total lease cost $ 448 $ 472 $ 540 Supplemental cash flow information related to leases was as follows: (In millions) 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 2 $ 3 $ 4 Operating cash flows from operating leases 370 408 447 Financing cash flows from finance leases 18 22 20 Right-of-use assets obtained in exchange for new finance lease liabilities 4 3 29 Right-of-use assets obtained in exchange for new operating lease liabilities 228 127 117 Supplemental balance sheets information related to leases was as follows: December 31, December 25, (In millions, except lease term and discount rate) 2022 2021 Property and equipment, net $ 29 $ 39 Operating lease right-of-use assets 874 936 Accrued expenses and other current liabilities 281 304 Short-term borrowings and current maturities of long-term debt 14 17 Long-term debt, net of current maturities 24 35 Operating lease liabilities 693 753 Weighted-average remaining lease term – finance leases 3 4 Weighted-average remaining lease term – operating leases 5 5 Weighted-average discount rate – finance leases 4.9 % 5.0 % Weighted-average discount rate – operating leases 6.1 % 5.8 % Maturities of lease liabilities as of December 31, 2022 were as follows: December 31, 2022 Operating Finance (In millions) Leases ( 1) Leases ( 2) 2023 $ 333 $ 15 2024 251 10 2025 182 7 2026 142 5 2027 96 3 Thereafter 125 1 1,129 41 Less imputed interest (155 ) (3 ) Total $ 974 $ 38 Reported as of December 31, 2022 Accrued expenses and other current liabilities $ 281 $ — Short-term borrowings and current maturities of long-term debt — 14 Long-term debt, net of current maturities — 24 Operating lease liabilities 693 — Total $ 974 $ 38 (1) Operating lease payments include $47 million related to options to extend lease terms that are reasonably certain of being exercised. (2) Finance lease payments include $1 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
STOCKHOLDERS' EQUITY | NOTE 10. STOCKHOLDERS’ EQUITY PREFERRED STOCK As of each of December 31, 2022, and December 25, 2021, there were 1,000,000 shares of $0.01 par value per share of preferred stock authorized; no shares were issued and outstanding. TREASURY STOCK In May 2021, the Board of Directors approved a stock repurchase program of up to $300 million, available through June 30, 2022. The Board of Directors reviewed the Company’s existing capital allocation programs in connection with the sale of CompuCom, and on December 31, 2021, authorized an additional $200 million for share repurchases under the then existing stock repurchase program, for a total authorization of $650 million. This stock repurchase program expired on June 30, 2022, and in July 2022, the Board of Directors approved a stock repurchase program of up to $600 million, available through June 30, 2024. In October 2022, the Board of Directors approved a new stock repurchase program of up to $1 billion, available through December 31, 2025 to replace the existing $600 million stock repurchase program effective November 3, 2022. The new authorization may be suspended or discontinued at any time. The exact timing of share repurchases will depend on market conditions and other factors, and will be funded through available cash balances. On November 16, 2021, as part of the stock repurchase program that expired on June 30, 2022, the Company entered into an accelerated share repurchase agreement (“ASR”) to repurchase shares of the Company’s common stock in exchange for an up-front payment of $150 million and increased the authorization to $450 million. The ASR repurchase period ran through May 25, 2022, and the Company received 0.7 million shares of its common stock as the final settlement of the ASR in the second quarter of 2022. The Company repurchased 3.6 million shares of its common stock in total at an average price per share of $41.46 under the ASR. In July 2022, as part of the $600 million stock repurchase program, the Board of Directors approved a Dutch auction tender offer to repurchase up to $300 million worth of shares of its common stock, based on demand. Through this tender offer, the Company’s shareholders had the opportunity to tender some or all of their shares at a price within the range of $31.50 to $36.00 per share subject to the conditions set forth in the tender offer documents. The tender offer commenced on July 18, 2022 and expired on August 12, 2022. The Company repurchased 14 thousand shares under the tender offer at a cost of $1 million. The Company repurchased 6 million additional shares of its common stock, at a cost of $266 million, in the third and fourth quarters of 2022. As a result, the Company repurchased 7 million shares in 2022, including the final settlement of the ASR at a weighted average price of $41.21 per common share, for total consideration of $295 million. As of December 31, 2022, $847 million remains available for stock repurchases under the current stock repurchase program, . Subsequent to the end of fiscal 2022 and through February 22, 2023, the Company repurchased 2 million shares of its common stock at a cost of $100 million . At December 31, 2022, there were 23 million shares of common stock held in treasury. The Company’s Third Amended Credit Agreement permits restricted payments, such as common stock repurchases, but may be limited if the Company does not meet the required minimum liquidity or fixed charge coverage ratio requirements Company’s compliance with covenants. DIVIDENDS ON COMMON STOCK The Company did not declare any cash dividends in 2022. The Company does not anticipate declaring cash dividends in the foreseeable future. The Company’s Third Amended Credit Agreement permits restricted payments, such as dividends, but may be limited if the Company does not meet the required minimum liquidity or fixed charge coverage ratio requirements. Refer to Note 8 for additional information about the Company’s compliance with covenants. ACCUMULATED OTHER COMPREHENSIVE LOSS Accumulated other comprehensive loss activity, net of tax, where applicable, is provided in the following tables: (In millions) Foreign Currency Translation Adjustments Change in Deferred Pension Total Balance at December 25, 2021 $ (27 ) $ 21 $ (6 ) Other comprehensive income activity before reclassifications (18 ) (62 ) (80 ) Reclassification of foreign currency translation adjustments realized upon disposal of business 6 6 Tax impact — 3 3 Total other comprehensive income, net of tax, where applicable (12 ) (59 ) (71 ) Balance at December 31, 2022 $ (39 ) $ (38 ) $ (77 ) (In millions) Foreign Currency Translation Adjustments Change in Deferred Pension Total Balance at December 26, 2020 $ (27 ) $ (5 ) $ (32 ) Other comprehensive income activity — 32 32 Tax impact — (6 ) (6 ) Total other comprehensive income, net of tax, where applicable — 26 26 Balance at December 25, 2021 $ (27 ) $ 21 $ (6 ) |
STOCK-BASED COMPENSATION
STOCK-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
STOCK-BASED COMPENSATION | NOTE 11. STOCK-BASED COMPENSATION LONG-TERM INCENTIVE PLANS During 2021, the Company’s Board of Directors adopted, and the shareholders approved, the ODP Corporation 2021 Long-Term Incentive Plan (the “Plan”). The Plan replaces the Office Depot, Inc. 2019 Long-Term Incentive Plan, the Office Depot, Inc. 2017 Long-Term Incentive Plan, the Office Depot, Inc. 2015 Long-Term Incentive Plan, the Office Depot, Inc. 2007 Long-Term Incentive Plan, as amended, and the 2003 OfficeMax Incentive and Performance Plan (together, the “Prior Plans”). No additional awards were granted under the Prior Plans effective March 10, 2021, the effective date of the Plan. The Plan permits the issuance of stock options, nonqualified stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, and other equity-based incentive awards. Employee share-based awards are generally issued in the first quarter of the year. Total compensation expense for share-based awards was $ 40 million in 202 2 , $ 38 million in 202 1 and $ 41 million in 20 20 , and the total recognized tax benefit related thereto was $ 11 million in 202 2 , $ 14 million in 202 1 and $ 3 million in 20 20 . RESTRICTED STOCK AND RESTRICTED STOCK UNITS In 2022, the Company granted 0.9 million shares of restricted stock and restricted stock units to eligible employees which included 25,000 shares granted to the Board of Directors. The Board of Directors are granted restricted stock units as part of their annual compensation which vest immediately on the grant date with distribution to occur following their separation from service with the Company. Restricted stock grants to Company employees typically vest annually over a three-year 2022 2021 2020 Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Outstanding at beginning of year 1,386,778 $ 30.48 1,526,653 $ 24.71 1,394,756 $ 30.40 Granted 933,487 42.81 521,512 39.55 835,828 19.92 Vested (585,563 ) 29.65 (593,249 ) 23.72 (579,584 ) 30.71 Forfeited (203,740 ) 36.29 (68,138 ) 29.20 (124,347 ) 28.60 Outstanding at end of year 1,530,962 $ 37.54 1,386,778 $ 30.48 1,526,653 $ 24.71 As of December 31, 2022, there was approximately $34.6 million of total unrecognized compensation cost related to nonvested restricted stock. This expense, net of forfeitures, is expected to be recognized over a weighted-average period of approximately 2 years. Total outstanding shares of 1.5 million include 0.2 million granted to members of the Board of Directors that have vested but will not be issued until separation from service and 1.3 million unvested shares granted to employees. The Company estimates that all 1.3 million unvested shares at year end will vest. The total fair value of shares at the time they vested during 2022 was $24.2 million. PERFORMANCE-BASED INCENTIVE PROGRAM The Company has a performance-based long-term incentive program consisting of performance stock units. Payouts under this program are based on achievement of certain financial targets, including the Company’s financial performance and total shareholder return performance set by the Board of Directors and are subject to additional service vesting requirements, generally three years from the grant date. A summary of the activity in the performance-based long-term incentive program since inception is presented below. 2022 2021 2020 Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Outstanding at beginning of year 2,175,831 $ 29.33 2,458,978 $ 24.22 1,994,111 $ 29.05 Granted 421,038 45.01 1,298,868 41.44 932,344 19.42 Vested (796,019 ) 29.71 (1,374,442 ) 23.47 (151,905 ) 41.80 Forfeited (343,125 ) 30.21 (207,573 ) 28.71 (315,572 ) 27.10 Outstanding at end of year ( 2) 1,457,725 $ 31.84 2,175,831 $ 29.33 2,458,978 $ 24.22 (1) Outstanding shares at the end of 2022 include 5 million shares of awards granted in 2020 that will be settled in cash in 2023. These awards are remeasured to fair value at each reporting period. The remeasurement impact was not material in 2022, 2021, and 2020. As of December 31, 2022, there was approximately $18.6 million of total unrecognized compensation expense related to the performance-based long-term incentive program. This expense, net of forfeitures, is expected to be recognized over a weighted-average period of approximately 1.7 years. Forfeitures in the table above include adjustments to the share impact of anticipated performance achievement. T he Company estimates that 1.4 million unvested shares at year end will vest. The total fair value of shares at the time they vested during 2022 was $ 36.1 million. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 12 Months Ended |
Dec. 31, 2022 | |
Compensation And Retirement Disclosure [Abstract] | |
EMPLOYEE BENEFIT PLANS | NOTE 12. EMPLOYEE BENEFIT PLANS PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS — NORTH AMERICA The Company has retirement obligations under OfficeMax’s U.S. pension plans. The Company sponsors these defined benefit pension plans covering certain terminated employees, vested employees, retirees and some active employees. In 2004 or earlier, OfficeMax’s pension plans were closed to new entrants and the benefits of eligible participants were frozen. Under the terms of these plans, the pension benefit for employees was based primarily on the employees’ years of service and benefit plan formulas that varied by plan. The Company’s general funding policy is to make contributions to the plans in amounts that are within the limits of deductibility under current tax regulations, and not less than the minimum contribution required by law. Additionally, under previous OfficeMax arrangements, the Company has responsibility for sponsoring retiree medical benefit and life insurance plans including plans related to operations in the U.S. and Canada (referred to as “Other Benefits” in the tables below). The type of retiree benefits and the extent of coverage vary based on employee classification, date of retirement, location, and other factors. All of these postretirement medical plans are unfunded. The Company explicitly reserves the right to amend or terminate its retiree medical and life insurance plans at any time, subject only to constraints, if any, imposed by the terms of collective bargaining agreements. Amendment or termination may significantly affect the amount of expense incurred. Obligations and Funded Status The following table provides a reconciliation of changes in the projected benefit obligation and the fair value of plan assets, as well as the funded status of the plans to amounts recognized on the Company’s Consolidated Balance Sheets. Pension Benefits Other Benefits (In millions) 2022 2021 2022 2021 Changes in projected benefit obligation: Obligation at beginning of period $ 830 $ 924 $ 13 $ 14 Service cost — — — — Interest cost 21 20 — Assumption changes (144 ) (28 ) (3 ) — Actuarial gain (9 ) (12 ) — — Currency exchange rate change — — — — Benefits paid (71 ) (74 ) (1 ) (1 ) Obligation at end of period $ 627 $ 830 $ 9 $ 13 Change in plan assets: Fair value of plan assets at beginning of period $ 836 $ 894 $ — $ — Actual return on plan assets (142 ) 14 — — Employer contribution 2 2 1 1 Benefits paid (71 ) (74 ) (1 ) (1 ) Fair value of plan assets at end of period 625 836 — — Net asset (liability) recognized at end of period $ (2 ) $ 6 $ (9 ) $ (13 ) The following table shows the amounts recognized in the Consolidated Balance Sheets related to the Company’s North America defined benefit pension and other postretirement benefit plans as of year-ends: Pension Benefits Other Benefits (In millions) 2022 2021 2022 2021 Noncurrent assets $ 7 $ 18 $ — $ — Current liabilities (1 ) (2 ) (1 ) (1 ) Noncurrent liabilities (8 ) (10 ) (8 ) (12 ) Net amount recognized $ (2 ) $ 6 $ (9 ) $ (13 ) The following table provides the accumulated benefit obligation for the Company’s North America defined benefit pension and other postretirement benefit plans with a projected benefit obligation and an accumulated benefit obligation in excess of plan assets as of year ends: Pension Benefits Other Benefits (In millions) 2022 2021 2022 2021 Accumulated benefit obligation in excess of plan assets Accumulated benefit obligation at end of period $ (9 ) $ (11 ) $ (9 ) $ (13 ) Fair value of plan assets at end of period — — — — Projected benefit obligation in excess of plan assets Benefit obligation at end of period (9 ) (11 ) Fair value of plan assets at end of period — — Components of Net Periodic Cost (Benefit) The components of net periodic benefit are as follows: Pension Benefits Other Benefits (In millions) 2022 2021 2020 2022 2021 2020 Service cost $ — $ — $ — $ — $ — $ — Interest cost 21 20 28 — — — Expected return on plan assets (26 ) (29 ) (32 ) — — — Net periodic benefit $ (5 ) $ (9 ) $ (4 ) $ — $ — $ — Other changes in plan assets and benefit obligations recognized in other comprehensive loss (income) are as follows: Pension Benefits Other Benefits (In millions) 2022 2021 2020 2022 2021 2020 Accumulated other comprehensive loss (income) at beginning of year $ (46 ) $ (21 ) $ 9 $ — $ 1 $ — Net loss (gain) 15 (25 ) (30 ) (2 ) (1 ) 1 Accumulated other comprehensive loss (income) at end of year $ (31 ) $ (46 ) $ (21 ) $ (2 ) $ — $ 1 Accumulated other comprehensive loss (income) as of year-ends 2022 and 2021 consist of net losses (gains). Assumptions The assumptions used in accounting for the Company’s plans are estimates of factors including, among other things, the amount and timing of future benefit payments. The following table presents the key weighted average assumptions used in the measurement of the Company’s benefit obligations as of year-ends: Other Benefits Pension Benefits United States Canada 2022 2021 2020 2022 2021 2020 2022 2021 2020 Discount rate 5.37 % 2.69 % 2.27 % 4.90 % 2.40 % 1.90 % 5.10 % 2.90 % 2.50 % The following table presents the weighted average assumptions used in the measurement of net periodic benefit: Other Benefits Pension Benefits United States Canada 2022 2021 2020 2022 2021 2020 2022 2021 2020 Discount rate 2.69 % 2.27 % 3.26 % 2.40 % 1.90 % 2.80 % 2.90 % 2.50 % 3.10 % Expected long-term rate of return on plan assets 3.64 % 4.31 % 5.16 % — % — % — % — % — % — % For pension benefits, the selected discount rates (which is required to be the rates at which the projected benefit obligations could be effectively settled as of the measurement date) are based on the rates of return for a theoretical portfolio of high-grade corporate bonds (rated AA- or better) with cash flows that generally match expected benefit payments in future years. In selecting bonds for this theoretical portfolio, the Company focuses on bonds that match cash flows to benefit payments and limit the concentration of bonds by issuer. To the extent scheduled bond proceeds exceed the estimated benefit payments in a given period, the yield calculation assumes those excess proceeds are reinvested at an assumed forward rate. The implied forward rate used in the bond model is based on the FTSE (formerly Citigroup) Pension Discount Curve as of the last day of the year. The selected discount rate for other benefits is from a discount rate curve matched to the assumed payout of related obligations. In 2022, as a result of an increase in the discount rate assumption, pension and other postretirement plan obligations decreased by $144 million and $3 million, respectively. In 2021, as a result of an increase in the discount rate assumption, pension plan obligations decreased by $31 million. The expected long-term rates of return on plan assets assumptions are based on the weighted average of expected returns for the major asset classes in which the plans’ assets are held. Asset-class expected returns are based on long-term historical returns, inflation expectations, forecasted gross domestic product and earnings growth, as well as other economic factors. The weights assigned to each asset class are based on the Company’s investment strategy. The weighted average expected return on plan assets used in the calculation of net periodic pension cost for 2023 is 5.17%. Obligation and costs related to the Canadian retiree health plan are impacted by changes in trend rates. The following table presents the assumed healthcare cost trend rates used in measuring the Company’s postretirement benefit obligations at year-ends: 2022 2021 2020 Weighted average assumptions as of year-end: Healthcare cost trend rate assumed for next year 6.10 % 6.20 % 6.10 % Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) 4.00 % 4.00 % 4.50 % Year that the rate reaches the ultimate trend rate 2041 2041 2029 The Company reassessed the assumptions, including those related to mortality, to measure the North American pension and other postretirement benefit plan obligations at year end 2022. The Society of Actuaries’ Retirement Plan Experience Committee did not release a new mortality improvement scale in 2022. Thus, the mortality assumption was not updated in 2022. In 2021, as a result of an increase in the mortality assumption, pension and other postretirement benefit plan obligations increased by $3 million and less than $1 million, respectively. For pension benefits, most of the obligation is based on participant data from the beginning of the year, which is rolled forward using standard actuarial techniques to the end of the year. Therefore, most actuarial (gains) losses that arise from demographic experience of participants varying from the selected assumptions, are not recognized until the following year. In 2022, pension plan obligations decreased by $9 million due to actuarial gains (actual demographic experience varying from actuarial assumptions). In 2021, pension plan obligations decreased by $12 million due to actuarial gains. This was primarily due to higher than assumed participant mortality in 2020 and a data clean-up of previously deceased beneficiaries. Plan Assets The allocation of pension plan assets by category at year-ends is as follows: 2022 2021 Cash 1 % 1 % Common collective trust funds 99 % 99 % 100 % 100 % The Employee Benefit Committee is responsible for establishing and overseeing the implementation of the investment policy for the Company’s pension plans. The investment policy is structured to optimize growth of the pension plan trust assets, while minimizing the risk of significant losses, in order to enable the plans to satisfy their benefit payment obligations over time. The Company uses a glide path investment strategy and Company contributions as its primary rebalancing mechanisms to maintain the asset class exposures within the guideline ranges established under the investment policy. In the second quarter of 2017, the Company reinvested substantially all of the assets attributable to the U.S. pension plans in common collective trust funds. The common collective trust funds are comprised of a diversified portfolio of investments across various asset classes, including U.S. and international equities and fixed-income securities. The common collective trust funds are valued at the net asset value (“NAV”) provided by the administrator of the fund. The net asset value is based on the value of the underlying assets owned by the fund, minus its liabilities, divided by the number of units outstanding. The investment policy for the pension plan assets allows for a broad range of asset allocations that permit the plans to de-risk in response to changes in funded position and market risks. The current investment policy includes a target asset allocation of 10% equity securities and 90% fixed income securities. Occasionally, the Company may utilize futures or other financial instruments to alter the pension trust’s exposure to various asset classes in a lower-cost manner than trading securities in the underlying portfolios. The following table presents the pension plan assets by level within the fair value hierarchy at year-ends. (In millions) Fair Value Measurements 2022 Asset Category Total Assets Measured at NAV (a) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Plan assets measured at net asset value: (a) Common collective trust funds: U.S. small and mid-cap equity securities $ 5 $ 5 $ — $ — $ — U.S. large cap equity securities 20 20 — — — International equity securities 31 31 — — — Corporate bonds 281 281 — — — Government securities 254 254 — — — Other fixed-income — — — — — Cash 29 29 — — — Total common collective trust funds 620 620 — — — Total plan assets measured at net asset value 620 620 — — — Plan assets measured in the fair value hierarchy: Cash 5 5 — — Total plan assets measured in the fair value hierarchy 5 — 5 — — Total plan assets $ 625 $ 620 $ 5 $ — $ — (a) Fair values of Common collective trust funds are estimated using net asset value per unit as a practical expedient which are excluded from the disclosure requirement to classify amounts in the fair value hierarchy in connection with the adoption of Accounting Standards Update (ASU) 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). (In millions) Fair Value Measurements 2021 Asset Category Total Assets Measured at NAV (a) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Plan assets measured at net asset value: (a) Common collective trust funds: U.S. small and mid-cap equity securities $ 7 $ 7 $ — $ — $ — U.S. large cap equity securities 29 29 — — — International equity securities 42 42 — — — Corporate bonds 485 485 — — — Government securities 245 245 — — — Other fixed-income 4 4 — — — Cash 18 18 — — — Total common collective trust funds 830 830 — — — Total plan assets measured at net asset value 830 830 — — — Plan assets measured in the fair value hierarchy: Cash 6 — 6 — — Total plan assets measured in the fair value hierarchy 6 — 6 — — Total plan assets $ 836 $ 830 $ 6 $ — $ — (a) Fair values of Common collective trust funds are estimated using net asset value per unit as a practical expedient which are excluded from the disclosure requirement to classify amounts in the fair value hierarchy in connection with the adoption of Accounting Standards Update (ASU) 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. Cash Flows Pension plan contributions include required statutory minimum amounts and, in some years, additional discretionary amounts. In 2022, the Company contributed $2 million to these pension plans. Pension contributions for the full year of 2023 are estimated to be $2 million. The Company may elect at any time to make additional voluntary contributions. Qualified pension benefit payments are paid from the assets held in the plan trust, while nonqualified pension and other benefit payments are paid by the Company. Anticipated benefit payments by year are as follows: (In millions) Pension Benefits Other Benefits 2023 $ 70 $ 1 2024 67 1 2025 64 1 2026 61 1 2027 59 1 Next five years 247 3 PENSION PLAN — UNITED KINGDOM The Company has a frozen defined benefit pension plan in the United Kingdom. Obligations and Funded Status The following table provides a reconciliation of changes in the projected benefit obligation, the fair value of plan assets and the funded status of the plan to amounts recognized on the Company’s Consolidated Balance Sheets. (In millions) 2022 2021 Changes in projected benefit obligation: Obligation at beginning of period $ 257 $ 269 Service cost — — Interest cost 4 4 Plan settlements — (7 ) Benefits paid (8 ) (5 ) Actuarial (gain) loss (89 ) (1 ) Currency translation (23 ) (3 ) Obligation at end of period 141 257 Changes in plan assets: Fair value of plan assets at beginning of period 358 360 Actual return on plan assets (130 ) 12 Company contributions 1 2 Plan settlements — (7 ) Benefits paid (8 ) (4 ) Currency translation (32 ) (5 ) Fair value of plan assets at end of period 189 358 Net asset recognized at end of period $ 48 $ 101 In the Consolidated Balance Sheets, the net funded amounts are classified as a non-current asset in the caption Other assets. Components of Net Periodic Benefit The components of net periodic benefit are presented below: (In millions) 2022 2021 2020 Service cost $ — $ — $ — Interest cost 4 4 5 Expected return on plan assets (6 ) (6 ) (5 ) Settlement gain — (1 ) — Net periodic pension benefit $ (2 ) $ (3 ) $ — Included in Accumulated other comprehensive income (loss) was deferred income of ($25) million and $24 million in 2022 and 2021, respectively. Assumptions Assumptions used in calculating the funded status and net periodic benefit included: 2022 2021 2020 Expected long-term rate of return on plan assets 3.47 % 2.03 % 1.64 % Discount rate 5.00 % 1.80 % 1.40 % Inflation 3.00 % 3.20 % 2.70 % The long-term rate of return on assets assumption has been derived based on long-term UK government fixed income yields, having regard to the proportion of assets in each asset class. The funds invested in equities have been assumed to return 2.71% above the return on UK government securities of appropriate duration. A return equal to a 15-year AA bond index is assumed for funds invested in corporate bonds. Allowance is made for expenses of 0.17 % of assets. Plan Assets The allocation of Plan assets is as follows: 2022 2021 Cash — % 2 % Equity securities 5 % 14 % Fixed-income securities 95 % 84 % Total 100 % 100 % A Trustee committee, comprised of representatives appointed by the Company and of members of this plan, is responsible for establishing and overseeing the implementation of the investment policy for this plan. The plan’s investment policy and strategy are to ensure assets are available to meet the obligations to the beneficiaries and to adjust plan contributions accordingly. The plan trustees are also committed to reducing the level of risk in the plan over the long term, while retaining a return above that of the growth of liabilities. Matching investments are intended to provide a return similar to the increase in the plan liabilities. Growth investments are assets intended to provide a return in excess of the increase in liabilities. At December 31, 2022, the asset allocation was in accordance with the target investment strategy. Asset-class allocations within the ranges are continually evaluated based on expectations for future returns, the funded position of the plan and market risks. The following table presents the pension plan assets by level within the fair value hierarchy. (In millions) Fair Value Measurements 2022 Asset Category Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash $ 1 $ 1 $ — $ — Equity securities Developed market equity funds — — — — Emerging market equity funds — — — — Mutual funds real estate — — — — Mutual funds 9 — 9 — Total equity securities 9 — 9 — Fixed-income securities UK debt funds 86 — 86 — Liability term matching debt funds 76 — 76 — Emerging market debt fund — — — — High yield debt 17 — 17 — Total fixed-income securities 179 — 179 — Total $ 189 $ 1 $ 188 $ — (In millions) Fair Value Measurements 2021 Asset Category Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash $ 9 $ 9 $ — $ — Equity securities Developed market equity funds 13 13 — — Emerging market equity funds 4 4 — — Mutual funds real estate 2 — — 2 Mutual funds 30 — 30 — Total equity securities 49 17 30 2 Fixed-income securities UK debt funds 154 — 154 — Liability term matching debt funds 115 — 115 — Emerging market debt fund 2 — 2 — High yield debt 29 — 29 — Total fixed-income securities 300 — 300 — Total $ 358 $ 26 $ 330 $ 2 The following is a reconciliation of the change in fair value of the pension plan assets calculated based on Level 3 inputs: (In millions) Total Balance at December 25, 2021 $ 2 Net sales (2 ) Balance at December 31, 2022 $ — Cash Flows Anticipated benefit payments for the UK pension plan, at 2022 year-end exchange rates, are as follows: (In millions) Benefit Payments 2023 $ 9 2024 9 2025 9 2026 9 2027 10 Next five years 52 RETIREMENT SAVINGS PLANS The Company also sponsors defined contribution plans for most of its employees. Eligible Company employees may participate in the Office Depot, Inc. Retirement Savings Plans (a plan for U.S. employees and a plan for Puerto Rico employees). All of the Company’s defined contribution plans (the “401(k) Plans”) allow eligible employees to contribute a percentage of their salary, commissions and bonuses in accordance with plan limitations and provisions of Section 401(k) of the Internal Revenue Code and the Company makes partial matching contributions to each plan subject to the limits of the respective 401(k) Plans. Matching contributions are invested in the same manner as the participants’ pre-tax contributions. The 401(k) Plans also allow for a discretionary matching contribution in addition to the normal match contributions if approved by the Board of Directors. ODP and OfficeMax previously sponsored non-qualified deferred compensation plans that allowed certain employees, who were limited in the amount they could contribute to their respective 401(k) plans, to defer a portion of their earnings and receive a Company matching amount. Both plans are closed to new contributions. Compensation expense for the Company’s contributions to these retirement savings plans was $17 million in 2022, $16 million in 2021 and $17 million in 2020. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 13. FAIR VALUE MEASUREMENTS RECURRING FAIR VALUE MEASUREMENTS In accordance with GAAP, certain assets and liabilities are required to be recorded at fair value on a recurring basis. The Company’s assets and liabilities that are adjusted to fair value on a recurring basis are money market funds that qualify as cash equivalents, and derivative financial instruments, which may be entered into to mitigate risks associated with changes in foreign currency exchange rates, fuel and other commodity prices and interest rates. Amounts associated with derivative instruments were not significant. NONRECURRING FAIR VALUE MEASUREMENTS In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records certain assets and liabilities at fair value on a nonrecurring basis as required by GAAP. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges. The Company recognized asset impairment charges of $14 $20 Of the asset impairment charges in 2021, $16 million was related to impairment of operating lease ROU assets associated with the Company’s retail store locations, and the remainder was related to impairment of fixed assets at these retail store locations. Of the asset impairment charges in 2020, $ 115 million was related to the impairment of goodwill in the Contract reporting unit, $ 48 million was related to impairment of operating lease ROU assets associated with the Company’s retail store locations, $ 12 million was related to impairment of fixed assets at these retail store locations, and the remainder related to a cost method investment and write-down of intangible assets that are not currently used. The Company regularly reviews retail store assets for impairment indicators at the individual store level, as this represents the lowest level of identifiable cash flows. When indicators of impairment are present, a recoverability analysis is performed which considers the estimated undiscounted cash flows over the retail store’s remaining life and uses input from retail operations and accounting and finance personnel. These inputs include management’s best estimates of retail store-level sales, gross margins, direct expenses, exercise of future lease renewal options when reasonably certain to be exercised, and resulting cash flows that can naturally include judgments about how current initiatives will impact future performance. The assumptions used within the recoverability analysis for the retail stores were updated to consider current quarter retail store operational results and formal plans for future retail store closures as part of the Company’s restructuring programs, including the probability of closure at the retail store level. While it is generally understood that closures will approximate the store’s lease termination date, it is possible that changes in store performance or other conditions could result in future changes in assumptions utilized . These assumptions reflected declining sales over the forecast period, and gross margin and operating cost assumptions that are consistent with recent actual results and consider plans for future initiatives. The Company also analyzed the impact of the COVID-19 pandemic on store asset recoverability. Due to the nature of products sold, the retail stores were considered to be essential by most local jurisdictions and as a result, the substantial majority of these retail stores have remained open and operational with the appropriate safety measures in place since the beginning of the COVID-19 outbreak, including a curbside pickup option. The Company’s recoverability assessment included evaluating the impact of these developments. If the undiscounted cash flows of a retail store cannot support the carrying amount of its assets, the assets are impaired if necessary and written down to estimated fair value. The fair value of retail store assets is determined using a discounted cash flow analysis which uses Level 2 unobservable inputs that are corroborated by market data such as independent real estate valuation The Company will continue to evaluate initiatives to improve performance and lower operating costs. There is uncertainty regarding the impact of the COVID-19 pandemic, supply chain and macroeconomic conditions on the future results of operations, including the forecast period used in the recoverability analysis. achieved and are subsequently reduced, additional impairment charges may result. However, at the end of 2022 , the impairment recognized reflects the Company’s best estimate of future performance. In addition to its retail store assets, the Company also regularly evaluates whether there are impairment indicators associated with its other long-lived assets, which were negatively impacted by the COVID-19 pandemic, as discussed in Note 7. The Company did not identify any impairment indicators for these long-lived assets as of December 31, 2022 R OTHER FAIR VALUE DISCLOSURES The fair values of cash and cash equivalents, receivables, trade accounts payable and accrued expenses and other current liabilities approximate their carrying amounts because of their short-term nature. The following table presents information about financial instruments at the balance sheet dates indicated. December 31, December 25, 2022 2021 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Financial assets: Company-owned life insurance 138 138 137 137 Financial liabilities: Long-term debt: New Facilities loans under the Third Amended Credit Agreement, due 2025 57 57 100 100 Revenue bonds, due in varying amounts periodically through 2029 75 76 75 76 American & Foreign Power Company, Inc. 5% debentures, due 2030 15 14 15 16 The following methods and assumptions were used to estimate the fair value of each class of financial instruments: • Company-owned life insurance: In connection with the 2013 OfficeMax merger, the Company acquired company-owned life insurance policies on certain former employees. The fair value of the company-owned life insurance policies is derived using determinable net cash surrender value , which is the cash surrender value less any outstanding loans (Level 2 measure). The carrying amounts of the company-owned life insurance policies are included in Other assets in the Consolidated Balance Sheets. • Long-term debt: Long-term debt, for which there were no transactions on the measurement date, was valued based on quoted market prices near the measurement date when available or by discounting the future cash flows of each instrument using rates based on the most recently observable trade or using rates currently offered to the Company for similar debt instruments of comparable maturities (Level 2 measure). The carrying amount of the New Facilities loans under the Third Amended Credit Agreement approximates fair value because the interest rates vary with market interest rates. Refer to Note 8 for additional information about the Third Amended Credit Agreement. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 14. COMMITMENTS AND CONTINGENCIES COMMITMENTS The Company has a paper purchase agreement with Boise White Paper, L.L.C. (“Boise Paper”) under which it agreed to purchase office paper from Boise Paper and Boise Paper has agreed to supply office paper to the Company, subject to the terms and conditions of the paper purchase agreement. Under the agreement, the Company has committed to purchase a portion of its paper product offering from Boise Paper. Purchases under the agreement were $354 INDEMNIFICATIONS Indemnification obligations may arise from the Asset Purchase Agreement between OfficeMax Incorporated, OfficeMax Southern Company, Minidoka Paper Company, Forest Products Holdings, L.L.C. and Boise Land & Timber Corp. The Company has agreed to provide indemnification with respect to a variety of obligations. These indemnification obligations are subject, in some cases, to survival periods, deductibles and caps. At December 31, 2022, the Company is not aware of any material liabilities arising from these indemnifications. Additionally, the Company retains certain guarantees in place with respect to the liabilities or obligations of the European Business and remains contingently liable for these obligations. However, the Purchaser must indemnify and hold the Company harmless for any losses in connection with these guarantees. The Company currently does not believe it is probable it would be required to perform under any of these guarantees or any of the underlying obligations. LEGAL MATTERS The Company is involved in litigation arising in the normal course of business. While, from time to time, claims are asserted that make demands for a large sum of money (including, from time to time, actions which are asserted to be maintainable as class action suits), the Company does not believe that contingent liabilities related to these matters (including the matters discussed below), either individually or in the aggregate, will materially affect the Company’s financial position, results of operations or cash flows. In addition, in the ordinary course of business, sales to and transactions with government customers may be subject to lawsuits, investigations, audits and review by governmental authorities and regulatory agencies, with which the Company cooperates. Many of these lawsuits, investigations, audits and reviews are resolved without material impact to the Company. While claims in these matters may at times assert large demands, the Company does not believe that contingent liabilities related to these matters, either individually or in the aggregate, will materially affect its financial position, results of operations or cash flows. In addition to the foregoing, OfficeMax is named a defendant in a number of lawsuits, claims, and proceedings arising out of the operation of certain paper and forest products assets prior to those assets being sold in 2004, for which OfficeMax agreed to retain responsibility. Also, as part of that sale, OfficeMax agreed to retain responsibility for all pending or threatened proceedings and future proceedings alleging asbestos-related injuries arising out of the operation of the paper and forest products assets prior to the closing of the sale. The Company has made provision for losses with respect to the pending proceedings. Additionally, as of December 31, 2022, the Company has made provision for environmental liabilities with respect to certain sites where hazardous substances or other contaminants are or may be located. For these liabilities, the Company’s estimated range of reasonably possible losses was approximately $15 million to $25 million. The Company regularly monitors its estimated exposure to these liabilities. As additional information becomes known, these estimates may change, however, the Company does not believe any of these OfficeMax retained proceedings are material to the Company’s financial position, results of operations or cash flows. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations And Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | NOTE 15. DISCONTINUED OPERATIONS In January 2021, the Company’s Board of Directors announced that as a result of a business review of CompuCom, management had initiated a process to explore a value-maximizing sale of the Company’s former CompuCom Division. On June 29, 2021, the Company’s Board of Directors aligned with management’s commitment to a plan to sell CompuCom through a single disposal group. Although management did not bring forth a specific transaction to the Board of Directors at the time, the sale was probable and expected to complete it within one year from June 29, 2021. Accordingly, management concluded that the CompuCom disposal group had met the accounting criteria to be classified as held for sale as of June 29, 2021 and is presented as such in the Consolidated Balance Sheet as of December 25, 2021. The planned disposition of CompuCom represented a strategic shift that will have a major impact on the Company’s operations and financial results. Accordingly, the Company also present ed the operating results and cash flows of its CompuCom Division as discontinued operations for all periods presented. The sale of CompuCom was completed on December 31, 2021, and the transaction was structured and will be accounted for as an equity sale. The related Securities Purchase Agreement (“SPA”) provides for consideration consisting of a cash purchase price equal to $125 million (subject to customary adjustments, including for cash, debt and working capital), an interest-bearing promissory note in the amount of $55 million, and a holding fee (“earn-out”) provision providing for payments of up to $125 million in certain circumstances. The promissory note accrues interest at six percent per annum, payable on a quarterly basis in cash or in-kind, and is due in full on June 30, 2027. Under the earn-out provision, if the purchaser receives dividends or sale proceeds from the CompuCom business equal to (i) three (3) times its initial capital investment in the CompuCom business plus (ii) 15% per annum on subsequent capital investments, the Company will be entitled to 50% of any subsequent dividends or sale proceeds up to and until the Company has received an aggregate of $125 million. The Company also agreed to provide certain transitional services to the purchaser for a period of three to twelve months under a separate agreement after closing. The SPA contains customary warranties of the Company and the purchaser. CompuCom was presented as held for sale as of December 25, 2021, and the loss from classification to held for sale was measured at the lower of its carrying amount or estimated fair value less costs to sell and was included in the valuation allowance of current assets held for sale as of December 25, 2021. The estimated fair value of CompuCom was based on the terms of the SPA, and amounted to $190 million, which included $126 million for cash purchase price after adjusting for cash, debt and working capital, $55 million for the promissory note, and $9 million for the earn-out. Of the cash purchase price, $30 million was related to adjustments for cash, debt and working capital and was recorded as a current receivable upon completion of the sale. The promissory note and the earn-out are non-current receivables as of December 31, 2022. The earn-out provision was identified to be a derivative in accordance with ASC 815, and its fair value was determined using Monte Carlo simulation. The resulting loss from classification to held for sale was $170 million in the fourth quarter of 2021. In the fourth quarter of 2022, the Company and the purchaser settled on the cash, debt and working capital adjustments, which resulted in a total receivable of $9 million, of which $5 Merger and restructuring expenses incurred by the former CompuCom Division, that were previously presented as Corporate expenses, are included in the measurement and presentation of discontinued operations in all periods presented. The following table represents a reconciliation of the major components of Discontinued operations, net of tax presented in the Consolidated Statements of Operations. (In millions) 2022 2021 2020 Major components of discontinued operations before income taxes: Sales $ — $ 802 $ 838 Cost of goods and occupancy costs - 645 657 Gross profit — 157 181 Selling, general and administrative expenses — 152 171 Asset impairments — 252 248 Merger, restructuring and other operating expenses, net — (2 ) 20 Operating loss — (245 ) (258 ) Other income (expense), net — (1 ) 1 Loss from major components of discontinued operations before income taxes — (246 ) (257 ) Loss from classification to held for sale (13 ) (170 ) — Loss from discontinued operations before income taxes (13 ) (416 ) (257 ) Income tax benefit (1 ) (21 ) (1 ) Discontinued operations, net of tax $ (12 ) $ (395 ) $ (256 ) The following table represents the major classes of assets and liabilities of the disposal group classified as held for sale presented in the Consolidated Balance Sheet as of December 25, 2021. The Company completed the sale of CompuCom on December 31, 2021, and therefore no assets or liabilities are included in discontinued operations as of December 31, 2022. December 25, (In millions) 2021 Major classes of assets included in discontinued operations: Cash and cash equivalents $ 23 Receivables, net 221 Inventories 20 Prepaid expenses and other current assets 15 Property and equipment, net 25 Operating lease right-of-use assets 66 Other intangible assets, net 255 Other assets 14 Less: valuation allowance (170 ) Total assets of the disposal group classified as held for sale $ 469 Major classes of liabilities included in discontinued operations: Trade accounts payable $ 83 Accrued expenses and other current liabilities 86 Deferred income taxes and other long-term liabilities 75 Operating lease liabilities 46 Total liabilities of the disposal group classified as held for sale $ 290 |
QUARTERLY FINANCIAL DATA (UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | NOTE 16. QUARTERLY FINANCIAL DATA (UNAUDITED) (In millions, except per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year Ended December 31, 2022* Net sales $ 2,178 $ 2,034 $ 2,172 $ 2,106 Gross profit 484 431 486 446 Operating income (1) 76 28 84 55 Net income from continuing operations 55 20 67 36 Discontinued operations, net of tax — 7 — (19 ) Net income 55 27 67 17 Basic earnings (loss) per share (2) Continuing operations $ 1.14 $ 0.40 $ 1.39 $ 0.79 Discontinued operations — 0.15 (0.01 ) (0.41 ) Net basic earnings per share $ 1.14 $ 0.55 $ 1.38 $ 0.38 Diluted earnings (loss) per share (2) Continuing operations $ 1.09 $ 0.39 $ 1.36 $ 0.76 Discontinued operations — 0.15 (0.01 ) (0.40 ) Net diluted earnings per share $ 1.09 $ 0.54 $ 1.35 $ 0.36 * Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year. (1 ) Includes Merger, restructuring and other operating expenses, net totaling $10 million, $23 million, $8 million and ($3) million in the first, second, third and fourth quarters of 2022 , ( 2 ) The sum of the quarterly earnings (loss) per share does not equal the annual earnings (loss) per share due to differences in quarterly and annual weighted-average shares outstanding. (In millions, except per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year Ended December 25, 2021* Net sales $ 2,174 $ 2,070 $ 2,179 $ 2,042 Gross profit 495 432 504 432 Operating income (3) 69 30 104 31 Net income from continuing operations 63 20 73 32 Discontinued operations, net of tax (10 ) (108 ) 28 (306 ) Net income (loss) 53 (88 ) 101 (274 ) Basic earnings (loss) per share (4) Continuing operations $ 1.17 $ 0.36 $ 1.38 $ 0.63 Discontinued operations (0.18 ) (1.98 ) 0.54 (6.07 ) Net basic earnings (loss) per share $ 0.99 $ (1.62 ) $ 1.92 $ (5.44 ) Diluted earnings (loss) per share (4) Continuing operations $ 1.12 $ 0.35 $ 1.33 $ 0.61 Discontinued operations (0.17 ) (1.93 ) 0.52 (5.87 ) Net diluted earnings (loss) per share $ 0.95 $ (1.58 ) $ 1.85 $ (5.26 ) * Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year. ( 3 ) Includes Merger, restructuring and other operating expenses, net totaling $13 million, $11 million, $13 million and $14 million in the first, second, third and fourth quarters of 2021, respectively. The first, second, third and fourth quarters of 2021 also include asset impairments of $12 million, $1 million, $5 million and $2 million, respectively. ( 4 ) The sum of the quarterly earnings (loss) per share does not equal the annual earnings (loss) per share due to differences in quarterly and annual weighted-average shares outstanding. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 17. SUBSEQUENT EVENTS In January 2023, t he Company acquired a small independent regional office supply distribution business in the U.S. ertain disclosures set forth under ASC 805, including supplemental pro forma financial information, are not disclosed because the operating results of the acquired business is not material to the Company. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Nature of Business | Nature of Business: The ODP Corporation (including its consolidated subsidiaries, “ODP” or the “Company”) is a leading provider of products, services and technology solutions through an integrated business-to-business (“B2B”) distribution platform and omni-channel presence, which includes supply chain and distribution operations, dedicated sales professionals, a B2B digital procurement solution, online presence, and a network of Office Depot and OfficeMax retail stores. Through its operating companies Office Depot, LLC; ODP Business Solutions, LLC; Veyer, LLC; and Varis, LLC, The ODP Corporation empowers every business, professional, and consumer to achieve more every day. |
Basis of Presentation | Basis of Presentation: The Consolidated Financial Statements of ODP include the accounts of all wholly owned and financially controlled subsidiaries prior to disposition. The Company owns 88% of a subsidiary that formerly owned assets in Cuba, which were confiscated by the Cuban government in the 1960’s. Due to various asset restrictions, the fair value of this investment is not determinable, and no amounts are included in the Consolidated Financial Statements. Intercompany transactions have been eliminated in consolidation. Prior to the third quarter of 2022, the Company had two reportable segments (or “Divisions”), which were its Business Solutions Division and Retail Division. During the third quarter of 2022, the Company re-aligned its operations into its consumer business named Office Depot, and three distinct B2B business and digital segments which are ODP Business Solutions, Veyer and Varis. As a result, the Company re-evaluated its reportable segments, and determined that The Company’s CompuCom Division was sold through a single disposal group on December 31, 2021. The Company has reclassified the financial results of the CompuCom Division to Discontinued operations, net of tax in the Consolidated Statements of Operations for all periods presented. The Company also reclassified the related assets and liabilities as assets and liabilities held for sale on the accompanying Consolidated Balance Sheet a s of December 25, 2021, and presented cash flows from the Company’s discontinued operations in the Consolidated Statements of Cash Flows for all periods. As a result of the CompuCom Division’s presentation as discontinued operations, the Company’s level of service revenue is below 10% of the Company’s total revenue for all periods presented and accordingly, revenues and cost of sales from services and products are not separately disclosed in the Company’s Consolidated Statements of Operations. Prior period amounts have been reclassified to conform to the current period presentation. |
Maintaining All Operating Businesses under Common Ownership | MAINTAINING ALL OPERATING BUSINESSES UNDER COMMON OWNERSHIP In May 2021, the Company’s Board of Directors unanimously approved a plan to pursue a separation of the Company into two independent, publicly traded companies representing its B2B and consumer businesses, which was planned to be achieved through a spin-off of its consumer business. On January 14, 2022, the Company announced that its Board of Directors determined to delay the previously announced public company separation to evaluate a potential sale of the Company’s consumer business and that it had received a non-binding proposal from another third party, in addition to the previously received proposal from USR Parent, Inc., to acquire the Company’s consumer business. On June 21, 2022, the Company’s Board of Directors, with the assistance of its financial and legal advisors, completed its review of both proposals received by the Company to acquire its consumer business and unanimously determined it to be in the best interests of the Company and its shareholders not to divest the consumer business at that time. Further, due to current market conditions, the Company’s Board of Directors also determined not to resume the Company’s previously planned spin-off of its consumer business at that time and instead maintain all of its businesses under common ownership. As discussed above, in connection with the Company’s announcement to maintain all of its businesses under common ownership, during the third quarter of 2022, the Company re-aligned its operations into its consumer business named Office Depot, and three distinct B2B business and digital segments which are ODP Business Solutions, Veyer and Varis. |
Fiscal Year | Fiscal Year: Fiscal years are based on a 52- or 53-week period ending on the last Saturday in December. Fiscal year 2022 had 53 weeks and ended on December 31, 2022. Fiscal year 2021 had 52 weeks and ended on December 25, 2021. Fiscal year 2020 had 52 weeks and ended on December 26, 2020. Certain subsidiaries operate on a calendar year basis; however, the reporting difference did not have a material impact in any period presented. |
Estimates and Assumptions | Estimates and Assumptions: 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 and disclosure of contingent assets and liabilities at the date of the C onsolidated F inancial S tatements and the reported amounts of revenues and expenses during the reporting period. Estimates and assumptions are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. The impact of the COVID-19 pandemic has been considered when making these estimates and assumptions, however, given the uncertainty related to the future effects of COVID-19, actual results could differ from these estimates. |
Business Combinations | Business Combinations: The Company applies the acquisition method of accounting for acquisitions where the Company is considered the accounting acquirer in accordance with ASC Topic 805, “Business Combinations” (“ASC 805”). The results of operations of acquired businesses are included in the Company’s consolidated results prospectively from the date of acquisition. The Company allocates the fair value of purchase consideration to the tangible and intangible assets acquired, liabilities assumed, and non-controlling interests in the acquired entity generally based on their fair values at the acquisition date. Various valuation methodologies are used to estimate the fair value of assets acquired and liabilities assumed, including using a market participant perspective when applying cost, income and relief from royalty analyses, supplemented with market appraisals where appropriate. Significant judgments and estimates are required in preparing these fair value estimates. The excess of the fair value of purchase consideration over the fair value of the assets acquired, liabilities assumed and non-controlling interests in the acquired entity is recorded as goodwill. The primary items that generate goodwill include the value of the synergies between the acquired company and the Company and the value of the acquired assembled workforce, neither of which qualifies for recognition as an intangible asset. The Company did not have any acquisitions in 2022. Based on new information received, the preliminary purchase price allocations of the companies acquired in 2021 have been adjusted during the respective measurement periods. These adjustments were insignificant individually and in the aggregate to the Company’s Consolidated Financial Statements. The measurement periods for acquisitions completed in 2021 closed within 2022. Under the guidance on accounting for business combinations, merger and integration costs are not included as components of consideration transferred, instead, they are accounted for as expenses in the period in which the costs are incurred. Transaction-related expenses are included in the Merger, restructuring and other operating expenses, net line in the Consolidated Statements of Operations. |
Foreign Currency | Foreign Currency: International operations in Canada and China use local currencies as their functional currency. Assets and liabilities are translated into U.S. dollars using the exchange rate at the balance sheet date. Revenues, expenses and cash flows are translated at average monthly exchange rates, or rates on the date of the transaction for certain significant items. Translation adjustments resulting from this process are recorded in Stockholders’ equity as a component of Accumulated other comprehensive loss. Foreign currency transaction gains or losses are recorded in the Consolidated Statements of Operations in Other income (expense), net or Cost of goods sold and occupancy costs, depending on the nature of the transaction. |
Cash and Cash Equivalents | Cash and Cash Equivalents: All short-term highly liquid investments with original maturities of three months or less from the date of acquisition are classified as cash equivalents. Amounts in transit from banks for customer credit card and debit card transactions are classified as cash. The banks process the majority of these amounts within two business days. Amounts not yet presented for payment to zero balance disbursement accounts of $16 million at December 31, 2022 are presented in Trade accounts payable and Accrued expenses and other current liabilities. At December 25, 2021, t here were no amounts not yet presented for payment to zero balance disbursement accounts At December 31, 2022 and December 25, 2021, cash and cash equivalents held outside the United States amounted to $113 million and $108 million, respectively. At December 25, 2021, there was $17 million cash and cash equivalents held outside the United states included in Current assets held for sale. Restricted cash consists primarily of cash in bank committed to fund UK pension obligations based on the agreements that govern the UK pension plan. Restricted cash is valued at cost, which approximates fair value. Restricted cash was $1 million at December 31, 2022. There was no restricted cash at December 25, 2021. |
Receivables | Receivables: Trade receivables totaled $412 million and $353 million at December 31, 2022 and December 25, 2021, respectively, net of an allowance for doubtful accounts of $8 million and $9 million, respectively, to reduce receivables to an amount expected to be collectible from customers. Exposure to credit risk associated with trade receivables is limited by having a large customer base that extends across many different industries and geographic regions. However, receivables may be adversely affected by an economic slowdown in the United States or internationally , as well as the impact of the COVID -19 pandemic on the expected credit and collectability trends . No single customer accounted for more than 10% of total sales or receivables in 2022 , 2021 or 2020 . Other receivables were $ 123 million and $ 143 million at December 31, 2022 and December 25, 2021 , respectively, of which $ 82 million and $ 104 million, respectively, are amounts due from vendors under purchase rebate, cooperative advertising and various other marketing programs. |
Inventories | Inventories: Inventories are stated at the lower of cost or net realizable value and are reduced for inventory losses based on estimated obsolescence, the impact of the COVID-19 pandemic on forecasted sales and expected selling prices, and the results of physical counts. The weighted average method is used throughout the Company to determine the cost of inventory. In-bound freight is included as a cost of inventories; cash discounts and certain vendor allowances that are related to inventory purchases are recorded as a product cost reduction. |
Income Taxes | Income Taxes: Income taxes are accounted for under the asset and liability method. This approach requires the recognition of deferred tax assets and liabilities attributable to differences between the carrying amounts and the tax bases of assets and liabilities and operating loss and tax credit carryforwards. Valuation allowances are recorded to reduce deferred tax assets to the amount believed to be more likely than not to be realized. The Company recognizes tax benefits from uncertain tax positions when it is more likely than not that the position will be sustained upon examination. Interest related to income tax exposures is included in interest expense in the Consolidated Statements of Operations. Refer to Note 4 for additional information on income taxes. |
Property and Equipment | Property and Equipment: Property and equipment additions are recorded at cost. Depreciation and amortization is recognized over the estimated useful lives using the straight-line method. The useful lives of depreciable assets are estimated to be 15-30 years for buildings and 3-10 years for furniture, fixtures and equipment. Computer software is amortized over three years for common office applications, five years for larger business applications and seven years for certain enterprise-wide systems. Leasehold improvements are amortized over the shorter of the estimated economic lives of the improvements or the terms of the underlying leases, including renewal options considered reasonably assured. The Company capitalizes certain costs related to internal use software that is expected to benefit future periods. These costs are amortized using the straight-line method over the 3 to 7 year expected life of the software. Major repairs that extend the useful lives of assets are capitalized and amortized over the estimated use period. Routine maintenance costs are expensed as incurred. Refer to Note 6 for additional information on property and equipment. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets: Goodwill represents the excess of the purchase price of an acquired entity over the fair value of the net tangible and identifiable intangible assets acquired and liabilities assumed in a business combination. The Company reviews the carrying amount of goodwill at the reporting unit level on an annual basis as of the first day of fiscal month December, or more frequently, if events or changes in circumstances suggest that goodwill may not be recoverable. For those reporting units where events or change in circumstances indicate that potential impairment indicators exist, the Company performs a quantitative assessment to determine whether the carrying amount of goodwill can be recovered. A significant amount of judgment is involved in determining if an indicator of impairment has occurred. The changes in reportable segments described above also resulted in the change of the Company’s reporting units during the third quarter of 2022, where each reportable segment also represents a reporting unit. Goodwill was allocated to the new reporting units using their relative fair values. When performing the annual goodwill impairment test, the Company may start with an optional qualitative assessment. As part of the qualitative assessment, the Company evaluates all events and circumstances, including both positive and negative events, in their totality, to determine whether it is not more likely than not that the fair value of a reporting unit is less than its carrying amount. If the Company bypasses the qualitative assessment, or if the qualitative assessment indicates that a quantitative analysis should be performed, the Company evaluates goodwill for impairment by comparing the fair value of a reporting unit to its carrying value, including the associated goodwill. The Company estimates the reporting unit’s fair value using discounted cash flow analysis and market-based evaluations, when available. If the carrying amount of the reporting unit exceeds the estimated fair value, an impairment charge is recorded to reduce the carrying value to the estimated fair value. The Company typically uses a combination of different Level 3 valuation approaches that are dependent on several significant estimates and assumptions related to forecasts of future revenues, cost of sales, expenses and the weighted-average cost of capital for each reporting unit. Any adverse change in these factors could have a significant impact on the recoverability of goodwill and could have a material impact on the Company’s Consolidated Financial Statements. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually. The Company evaluates its indefinite - lived intangible assets for impairment annually, or sooner if indications of possible impairment are identified . When performing the annual impairment test , the Company may first start with an optional qualitative assessment to determine whether it is not more likely than not that its indefinite-lived intangible assets are impaired . As part of a qualitative assessment, the Company evaluates relevant events and circumstances that could affect the significant inputs used to determine the fair value of the indefinite -lived intangible asset. If the Company bypasses the qualitative assessment, or if the qualitative assessment indicates that a quantitative analysis should be performed, the Company evaluates its indefinite-lived intangible assets for impairment by comparing the fair value of the asset to its carrying amount. Intangible assets determined to have finite lives are amortized on a straight-line basis over their estimated useful lives, where the useful life is the period over which the asset is expected to contribute directly, or indirectly, to the Company’s future cash flows. The Company periodically reviews its amortizable intangible assets to determine whether events and circumstances warrant a revision to the remaining period of amortization or asset impairment. Refer to Note 7 for additional information on goodwill and other intangible assets. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets: Long-lived assets with identifiable cash flows are reviewed for possible impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Retail store long-lived assets are regularly reviewed for impairment indicators. Impairment is assessed at the individual store level which is the lowest level of identifiable cash flows and considers the estimated undiscounted cash flows over the asset’s remaining life. If estimated undiscounted cash flows are insufficient to recover the investment, an impairment loss is recognized equal to the difference between the estimated fair value of the asset and its carrying value, net of salvage, and any costs of disposition, and allocated to the asset groups at the store level based on their relative fair values. The fair value estimate is generally the discounted amount of estimated store-specific cash flows. |
Facility Closure and Severance Costs | Facility Closure and Severance Costs: Retail store performance is regularly reviewed against expectations and retail stores not meeting performance requirements may be closed. Retail stores are also closed as part of restructuring activities which aim to optimize the Company’s retail footprint. Refer to Note 2 for additional information on the restructuring programs and associated store closures. Costs associated with facility closures, principally accrued lease costs, are recognized when the facility is no longer used in an operating capacity or when a liability has been incurred. Retail store assets, including operating lease right-of-use (“ROU”) assets, are also reviewed for possible impairment, or reduction of estimated useful lives. The Company recognizes charges or credits to adjust remaining closed facility accruals to reflect current expectations. Adjustments to facility closure costs are presented in the Consolidated Statements of Operations in Selling, general and administrative expenses if the related facility was closed as part of ongoing operations or in Merger, restructuring and other operating expenses, net, if the related facility was closed as part of a merger integration plan or restructuring plan. Refer to Note 2 for additional information on accrued expenses relating to closed facilities. The short-term and long-term components of this liability are included in Accrued expenses and other current liabilities and Deferred income taxes and other long-term liabilities, respectively, in the Consolidated Balance Sheets. Employee termination costs covered under written and substantive plans are accrued when probable and estimable and consider continuing service requirements, if any. Additionally, incremental one-time employee benefit costs are recognized when the key terms of the arrangements have been communicated to affected employees. Amounts are recognized when communicated or over the remaining service period, based on the terms of the arrangements. |
Accrued Expenses and Other Current Liabilities | Accrued Expenses and Other Current Liabilities: The major components of Accrued expenses and other current liabilities in the Consolidated Balance Sheets are tax liabilities, payroll and benefit accruals, customer rebates accruals, inventory receipts accruals and current portion of operating lease liabilities. Accrued payroll and benefits were $158 million and $148 million at December 31, 2022 and December 25, 2021, respectively. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments: The Company measures fair value 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. In developing its fair value estimates, the Company uses the following hierarchy: Level 1 Quoted prices in active markets for identical assets or liabilities. Level 2 Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3 Significant unobservable inputs that are not corroborated by market data. Generally, these fair value measures are model-based valuation techniques such as discounted cash flows or option pricing models using own estimates and assumptions or those expected to be used by market participants. The fair values of cash and cash equivalents, receivables, trade accounts payable and accrued expenses and other current liabilities approximate their carrying values because of their short-term nature. Refer to Note 13 for further fair value information. |
Revenue Recognition | Revenue Recognition: Revenue includes the sale of: - Supplies such as paper, writing instruments, office supplies, cleaning and breakroom items, personal protective equipment, and product subscriptions; - Technology related products such as toner and ink, printers, computers, tablets and accessories, electronic storage, and sales of third-party software, as well as technology support services offerings provided in the Company’s retail stores, such as installation and repair; - Furniture and other products such as desks, seating, luggage, gift cards and warranties, as well as supply chain services and e-procurement platform offerings; and - Copy and print services, including managed print and fulfillment services. The Company sells its supplies, furniture and other products through its ODP Business Solutions and Office Depot Divisions. Supply chain services are provided through its Veyer Division, and e-procurement platform fees are generated through its Varis Division. Customers can purchase products through the Company’s call centers, electronically through its Internet websites, or through its retail stores. Revenues from supplies, technology, and furniture and other product sales are recognized when the customer obtains control of the Company’s product, which occurs at a point in time, typically upon delivery to the customer. Furniture also includes arrangements where customers can make special furniture interior design and installation orders that are customized to their needs. The performance obligations related to these arrangements are satisfied over time. Substantially all of the Company’s copy and print and technology support services offerings are satisfied at a point in time and revenue is recognized as such. The majority of copy and print offerings, which includes printing, copying, and digital imaging, are fulfilled through retail stores and the related performance obligations are satisfied within a short period of time (generally within the same day). Significant Judgments Revenue is recognized upon transfer of control of promised products or services to customers for an amount that reflects the consideration the Company is entitled to receive in exchange for those products or services. For product sales, transfer of control occurs at a point in time, typically upon delivery to the customer. For service offerings, the transfer of control and satisfaction of the performance obligation is either over time or at a point in time. When performance obligations are satisfied over time, the Company evaluates the pattern of delivery and progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition. Revenue is recognized net of allowance for returns and net of any taxes collected from customers, which are subsequently remitted to governmental authorities. Shipping and handling costs are considered fulfillment activities and are recognized within the Company’s cost of goods sold. Contracts with customers could include promises to transfer multiple products and services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. Determining the standalone selling price also requires judgment. The Company did not have significant revenues generated from such contracts in 2022, 2021 and 2020. Products are generally sold with a right of return and the Company may provide other incentives, such as rebates and coupons, which are accounted for as variable consideration when estimating the amount of revenue to recognize. The Company estimates returns and incentives at contract inception and includes the amount in the transaction price for which significant reversal is not probable. These estimates are updated at the end of each reporting period as additional information becomes available. The Company offers a customer loyalty program that provides customers with rewards that can be applied to future purchases or other incentives. Loyalty rewards are accounted for as a separate performance obligation and deferred revenue is recorded in the amount of the transaction price allocated to the rewards, inclusive of the impact of estimated breakage. The estimated breakage of loyalty rewards is based on historical redemption rates experienced under the loyalty program. Revenue is recognized when the loyalty rewards are redeemed or expire. As December 31, 2022 and December 25, 2021 , the Company had $ 15 million and $ 12 million , respectively, of deferred revenue related to the loyalty program, which is included in Accrued expenses and other current liabilities in the Consolidated Balance Sheets. The Company recognizes revenue in certain circumstances before product delivery occurs (commonly referred to as bill-and-hold transactions). Revenue from bill-and-hold transactions is recognized when all specific requirements for transfer of control under a bill-and-hold arrangement have been met which include, among other things, a request from the customer that the product be held for future scheduled delivery. For these bill-and-hold arrangements, the associated product inventory is identified separately as belonging to the customer and is ready for physical transfer. |
Contract Balances | Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers. A receivable is recognized in the period the Company delivers goods or provides services, and is recorded at the invoiced amount. A receivable is also recognized for unbilled services where the Company’s right to consideration is unconditional, and is recorded based on an estimate of time and materials. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 20 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, the Company has determined that the contracts do not include a significant financing component. The primary purpose of the Company’s invoicing terms is to provide customers with simplified and predictable ways of purchasing its products and services. The Company receives payments from customers based upon contractual billing schedules. Contract assets include amounts related to deferred contract acquisition costs (refer to the section “Costs to Obtain a Contract” below) and if applicable, the Company’s conditional right to consideration for completed performance under a contract. The short- and long-term components of contract assets in the table below are included in Prepaid expenses and other current assets, and Other assets, respectively, in the Consolidated Balance Sheets. Contract liabilities include payments received in advance of performance under the contract, which are recognized as revenue when the performance obligation is completed under the contract, as well as accrued contract acquisition costs, liabilities related to the Company’s loyalty program and gift cards. The short- and long-term components of contract liabilities in the table below are included in Accrued expenses and other current liabilities, and Deferred income taxes and other long-term liabilities, respectively, in the Consolidated Balance Sheets. The following table provides information about receivables, contract assets and contract liabilities from contracts with customers: December 31, December 25, (In millions) 2022 2021 Trade receivables, net $ 412 $ 353 Short-term contract assets 8 16 Long-term contract assets 2 8 Short-term contract liabilities 41 52 Long-term contract liabilities — 2 In 2022 and 2021, the Company did not There were no contract assets and liabilities that were recognized in 2022 as a result of business combinations. Included in the table above are short- and long-term contract assets of $1 million as of December 25, 2021, related to CompuCom, which are presented as part of assets held for sale in the Consolidated Balance Sheets. Also included in the table above are short- and long-term contract liabilities of $10 million and $2 million, respectively, as of December 25, 2021 related to CompuCom, which are presented as part of liabilities held for sale in the Consolidated Balance Sheets. A majority of the purchase orders and statements of work related to contracts with customers require delivery of the product or service within one year or less. For certain service contracts that exceed one year, the Company recognizes revenue at the amount to which it has the right to invoice for services performed. Accordingly, the Company has applied the optional exemption provided by the new revenue recognition standard relating to unsatisfied performance obligations and does not disclose the value of unsatisfied performance obligations for its contracts. |
Costs to Obtain a Contract | Costs to Obtain a Contract The Company recognizes an asset for the incremental costs of obtaining a contract with a customer if it expects the benefit of those costs to be longer than one year. The Company has determined that certain rebate incentive programs meet the requirements to be capitalized. These costs are periodically reviewed for impairment and are amortized on a straight-line basis over the expected period of benefit. As of December 31, 2022 and December 25, 2021, short-term contract assets and long-term contract assets in the table above represent T here is uncertainty regarding the impacts of COVID-19 on the global and national economies, which could negatively affect the Company’s customers and result in future impairments of contract assets. |
Cost of Goods Sold and Occupancy Costs | Cost of Goods Sold and Occupancy Costs: Cost of goods sold and occupancy costs include: - inventory costs (as discussed above); - outbound freight; - employee and non-employee receiving, distribution, and occupancy costs (rent), including depreciation, real estate taxes and common area costs, of inventory-holding and selling locations; and - identifiable employee-related costs associated with services provided to customers. |
Selling, General and Administrative Expenses | Selling, General and Administrative Expenses: Selling, general and administrative expenses include amounts incurred related to expenses of operating and support functions, including: - employee payroll and benefits, including variable pay arrangements; - advertising; - store and field support; - executive management and various staff functions, such as information technology, human resources functions, finance, legal, internal audit, and certain merchandising and product development functions; - other operating costs incurred relating to selling activities; and - closed defined benefit pension and postretirement plans. Selling, general and administrative expenses are included in the determination of Division operating income to the extent those costs are considered to be directly or closely related to segment activity and through allocation of support costs. |
Merger, Restructuring and Other Operating Expenses, Net | Merger, restructuring and other operating expenses, net: Merger, restructuring and other operating expenses, net in the Consolidated Statements of Operations includes charges and, where applicable, credits for costs such as acquisition related expenses, employee termination and retention, transaction and integration-related professional fees, facility closure costs, gains and losses on asset dispositions, and other incremental costs directly related to these activities. This presentation is used to separately identify these significant costs apart from expenses incurred to sell to and service the Company’s customers or that are more directly related to ongoing operations. Changes in estimates and accruals related to these activities are also reflected on this line. Merger, restructuring and other operating expenses, net are not included in the measure of Division operating income. Refer to Note 2 for additional information. |
Advertising | Advertising: Advertising expenses are charged to Selling, general and administrative expenses when incurred. Advertising expenses recognized were $130 million in 2022, $139 million in 2021 and $177 million in 2020. Prepaid advertising expenses were $3 million as of December 31, 2022 and $4 million as of December 25, 2021. |
Share-Based Compensation | Share-Based Compensation: Compensation expense for all share-based awards expected to vest is measured at fair value on the date of grant and recognized on a straight-line basis over the related service period. The fair value of restricted stock and restricted stock units, including performance-based awards, is determined based on the Company’s stock price on the date of grant. Share-based awards with market conditions, such as total shareholder return, are valued using a Monte Carlo simulation as measured on the grant date. Share-based awards that are settled in cash are classified as liabilities and are measured to fair value at each reporting date. |
Self-insurance | Self-insurance: ODP is primarily self-insured for workers’ compensation, auto and general liability and employee medical insurance programs. The Company has stop-loss coverage to limit the exposure arising from these claims. Self-insurance liabilities are based on claims filed and estimates of claims incurred but not reported. These liabilities are not discounted. |
Vendor Arrangements | Vendor Arrangements: The Company enters into arrangements with substantially all significant vendors that provide for some form of consideration to be received from the vendors. Arrangements vary, but some specify volume rebate thresholds, advertising support levels, as well as terms for payment and other administrative matters. The volume-based rebates, supported by a vendor agreement, are estimated throughout the year and reduce the cost of inventory and cost of goods sold during the year. This estimate is regularly monitored and adjusted for current or anticipated changes in purchase levels and for sales activity. Other promotional consideration received is event-based or represents general support and is recognized as a reduction of Cost of goods sold and occupancy costs or Inventories, as appropriate, based on the type of promotion and the agreement with the vendor. Certain arrangements meet the specific, incremental, identifiable criteria that allow for direct operating expense offset, but such arrangements are not significant. |
Pension and Other Postretirement Benefits | Pension and Other Postretirement Benefits: The Company sponsors certain closed U.S. and U.K. defined benefit pension plans, certain closed U.S. retiree medical benefit and life insurance plans, as well as a Canadian retiree medical benefit plan open to certain employees. The Company recognizes the funded status of its defined benefit pension, retiree medical benefit and life insurance plans in the Consolidated Balance Sheets, with changes in the funded status recognized primarily through accumulated other comprehensive income (loss), net of tax, in the year in which the changes occur. Actuarially-determined liabilities related to pension and postretirement benefits are recorded based on estimates and assumptions. Factors used in developing estimates of these liabilities include assumptions related to discount rates, rates of return on investments, healthcare cost trends, benefit payment patterns and other factors. The Company also updates periodically its assumptions about employee retirement factors, mortality, and turnover. Refer to Note 12 for additional details. |
Environmental and Asbestos Matters | Environmental and Asbestos Matters: Environmental and asbestos liabilities relate to acquired legacy paper and forest products businesses and timberland assets. The Company accrues for losses associated with these obligations when probable and reasonably estimable. These liabilities are not discounted. A receivable for insurance recoveries is recorded when probable. |
Leasing Arrangements | Leasing Arrangements: The Company conducts a substantial portion of its business in leased properties. The Company first determines whether an arrangement is a lease at inception. Once that determination is made, leasing arrangements are presented in the Consolidated Balance Sheet as follows: • Finance leases : o Property and equipment, net –leases which were referred to as capital leases under the old accounting standard; o Short-term borrowings and current maturities of long-term debt – short-term obligations to make lease payments arising from the finance lease; and o Long-term debt, net of current maturities – long-term obligations to make lease payments arising from the finance lease. • Operating leases : o ROU assets – the Company’s right to use the underlying asset for the lease term; o Accrued expenses and other current liabilities – short-term obligations to make lease payments arising from the operating lease; and o Operating lease liabilities – long-term obligations to make lease payments arising from the operating lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. As the rate implicit in the lease is not readily determinable for any of the leases, the Company has utilized its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The determination of the appropriate incremental borrowing rate requires management to use significant estimates and assumptions as to its credit rating, base rates and credit spread, and other management assumptions for the impact of collateral. The operating lease ROU asset also includes any lease payments made prior to commencement and excludes lease incentives and initial direct costs incurred. Certain leases include one or more options to renew, with renewal terms that can extend the lease from five to 25 years or more, which is generally at the Company’s discretion. Any option or renewal periods management believed were reasonably certain of being exercised are included in the lease term and are used in calculating the operating lease ROU assets and lease liabilities. In addition, some of the Company’s leases contain escalation clauses. The Company recognizes rental expense for operating leases that contain predetermined fixed escalation clauses on a straight-line basis over the expected term of the lease. The Company has lease agreements with lease and non-lease components, for which it has made an accounting policy election to account for these as a single lease component. |
New Accounting Standards | NEW ACCOUNTING STANDARDS As of December 31, 2022, there were no recently issued accounting standards that may have a material impact on the Company's financial position, results of operations, or cash flows upon their adoption. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Receivables, Contract Assets and Contract Liabilities from Contracts with Customers | The following table provides information about receivables, contract assets and contract liabilities from contracts with customers: December 31, December 25, (In millions) 2022 2021 Trade receivables, net $ 412 $ 353 Short-term contract assets 8 16 Long-term contract assets 2 8 Short-term contract liabilities 41 52 Long-term contract liabilities — 2 |
MERGER, RESTRUCTURING AND OTH_2
MERGER, RESTRUCTURING AND OTHER ACTIVITY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Merger Restructuring And Other Activity [Abstract] | |
Summary of Major Components of Merger, Restructuring and Other Operating Expenses, Net | The table below summarizes the major components of Merger, restructuring and other operating expenses, net. (In millions) 2022 2021 2020 Merger and transaction related expenses Transaction and integration (7 ) — 4 Facility closure, contract termination and other expenses, net — — 1 Total Merger and transaction related expenses (7 ) — 5 Restructuring expenses Severance (13 ) (2 ) 41 Professional fees — 1 21 Facility closure, contract termination, and other expenses, net 5 15 35 Total Restructuring expenses, net (8 ) 14 97 Other operating expenses Professional fees 54 37 — Total Other operating expenses 54 37 — Total Merger, restructuring and other operating expenses, net $ 39 $ 51 $ 102 |
Facility Closure and Severance Costs | The activity in the merger and restructuring accruals in 2022 and 2021 is presented in the table below. Certain merger and restructuring charges are excluded from the table because they are paid as incurred or non-cash, such as accelerated depreciation and gains and losses on asset dispositions. (In millions) Beginning Balance Charges Incurred Cash Payments Ending Balance 2022 Termination benefits: Maximize B2B Restructuring Plan 19 (13 ) (1 ) 5 Lease and contract obligations, accruals for facilities closures and other costs: Maximize B2B Restructuring Plan 6 5 (7 ) 4 Comprehensive Business Review 1 — — 1 Previously planned separation of consumer business and re-alignment 2 52 (52 ) 2 Total $ 28 $ 44 $ (60 ) $ 12 2021 Termination benefits: Maximize B2B Restructuring Plan 27 (2 ) (6 ) 19 Business Acceleration Program 2 — (2 ) — Lease and contract obligations, accruals for facilities closures and other costs: Maximize B2B Restructuring Plan 10 9 (13 ) 6 Business Acceleration Program 1 — (1 ) — Comprehensive Business Review 2 — (1 ) 1 USR Parent, Inc. proposals — 5 (5 ) — Planned separation of consumer business — 32 (30 ) 2 Total $ 42 $ 44 $ (58 ) $ 28 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Summary of Sales, Operating Income (Loss) and Other Significant Balances by Each of the Divisions, Reconciled to Consolidated Totals | The following is a summary of sales and operating income (loss) by each of the Divisions, reconciled to consolidated totals: (In millions) ODP Business Solutions Division Office Depot Division Veyer Division Varis Division Eliminations Total 2022 Sales (external) $ 4,005 $ 4,451 $ 28 $ 7 $ - $ 8,491 Sales (internal) 19 36 5,855 - (5,910 ) — Total sales $ 4,024 $ 4,487 $ 5,883 $ 7 $ (5,910 ) $ 8,491 Division operating income (loss) $ 140 $ 285 $ 28 $ (66 ) $ - $ 387 2021 Sales (external) $ 3,602 $ 4,830 $ 28 $ 5 $ - $ 8,465 Sales (internal) 24 34 5,963 - (6,021 ) - Total sales $ 3,626 $ 4,864 $ 5,991 $ 5 $ (6,021 ) $ 8,465 Division operating income (loss) $ 72 $ 325 $ 30 $ (34 ) $ - $ 393 2020 Sales (external) $ 3,549 $ 5,300 $ 23 $ - $ - $ 8,872 Sales (internal) 29 35 6,321 - (6,385 ) - Total sales $ 3,578 $ 5,335 $ 6,344 $ - $ (6,385 ) $ 8,872 Division operating income (loss) $ 51 $ 317 $ 28 $ - $ - $ 396 The following table provides information about other significant balances by each of the Divisions, reconciled to consolidated totals: (In millions) ODP Business Solutions Division Office Depot Division Veyer Division Varis Division Corporate and Discontinued Operations* Consolidated Total 2022 Capital expenditures $ 5 $ 14 $ 20 $ 44 $ 16 $ 99 Depreciation and amortization 21 56 37 13 4 131 Assets 749 1,553 993 130 724 4,149 2021 Capital expenditures 5 15 22 14 17 73 Depreciation and amortization 24 67 40 4 11 146 Assets 654 1,728 1,038 83 1,362 4,865 2020 Capital expenditures 8 25 19 — 6 58 Depreciation and amortization 21 75 49 — 12 157 * Amounts included in “Corporate and Discontinued Operations” consist of (i) assets (including all cash and cash equivalents) and depreciation related to corporate activities and shared services of continuing operations, and (ii) assets of discontinued operations amounting to $469 million at December 25, 2021. |
Reconciliation of Measure of Division Operating Income to Consolidated Income (Loss) from Continuing Operations Before Income Taxes | A reconciliation of the measure of Division operating income to Consolidated income (loss) from continuing operations before income taxes is as follows: (In millions) 2022 2021 2020 Division operating income $ 387 $ 393 $ 396 Add/(subtract): Asset impairments (14 ) (20 ) (182 ) Merger, restructuring and other operating expenses, net (39 ) (51 ) (102 ) Unallocated expenses (91 ) (88 ) (106 ) Interest income 5 1 4 Interest expense (16 ) (28 ) (42 ) Loss on extinguishment and modification of debt — — (12 ) Other income, net 10 24 6 Income (loss) from continuing operations before income taxes $ 242 $ 231 $ (38 ) |
Summary of Disaggregated Revenue from Major Sales Categories | The following table provides information about disaggregated sales by major categories: (In millions) 2022 2021 2020 Major sales categories Supplies $ 4,144 $ 3,815 $ 4,006 Technology 2,461 2,758 3,014 Furniture and other 1,255 1,302 1,281 Copy and print 631 590 571 Total $ 8,491 $ 8,465 $ 8,872 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income (Loss) from Continuing Operations Before Income Taxes | The components of income (loss) from continuing operations before income taxes consisted of the following: (In millions) 2022 2021 2020 United States $ 226 $ 173 $ (30 ) Foreign 16 58 (8 ) Total income (loss) from continuing operations before income taxes $ 242 $ 231 $ (38 ) |
Schedule Income Tax Expense (Benefit) Related to Income (Loss) From Continuing Operations | The income tax expense (benefit) related to income (loss) from continuing operations consisted of the following: (In millions) 2022 2021 2020 Current: Federal $ 26 $ 14 $ (7 ) State (4 ) 8 17 Foreign 7 5 4 Deferred: Federal 27 13 19 State 10 2 (5 ) Foreign (2 ) 2 (3 ) Total income tax expense $ 64 $ 44 $ 25 |
Reconciliation of Income Taxes at The Federal Statutory Rate to The Provision for Income Taxes | The following is a reconciliation of income taxes at the U.S. Federal statutory rate to the provision for income taxes: (In millions) 2022 2021 2020 Federal tax computed at the statutory rate $ 51 $ 48 $ (8 ) State taxes, net of Federal benefit 11 10 4 Foreign income taxed at rates other than Federal 2 (5 ) 4 Increase (decrease) in valuation allowance — (3 ) (3 ) Non-deductible Goodwill impairments — — 24 Other non-deductible expenses and settlements 4 5 4 FIN 48 adjustments (2 ) — — Non-taxable income and additional deductible expenses (1 ) (3 ) (3 ) Impact of stock compensation (windfall)/shortfall (3 ) (6 ) 2 State NOL expirations 2 — — Other items, net — (2 ) 1 Income tax expense $ 64 $ 44 $ 25 |
Schedule of Components Deferred Income Tax Assets and Liabilities | The components of deferred income tax assets and liabilities consisted of the following: December 31, December 25, (In millions) 2022 2021 U.S. and foreign loss carryforwards $ 277 $ 61 Operating lease right-of-use assets 262 273 Pension and other accrued compensation 35 47 Basis difference in subsidiary held for sale — 23 Accruals for facility closings 2 2 Inventory 10 7 Self-insurance accruals 13 14 Deferred revenue 9 10 U.S. and foreign income tax credit carryforwards 38 70 Allowance for bad debts 4 5 Accrued expenses 14 18 Basis difference in fixed assets 43 36 Internally developed software 1 — Gross deferred tax assets 708 566 Valuation allowance (266 ) (93 ) Deferred tax assets 442 473 Internal software — 2 Operating lease liabilities 244 251 Intangibles 12 5 Undistributed foreign earnings 5 — Deferred tax liabilities 261 258 Net deferred tax assets $ 181 $ 215 |
Summary of Valuation Allowances | The following summarizes the activity related to valuation allowances for deferred tax assets: (In millions) 2022 2021 2020 Beginning balance $ 93 $ 99 $ 100 Additions, charged to expense 184 — 2 Reductions (11 ) (6 ) (3 ) Ending balance $ 266 $ 93 $ 99 |
Summary of Activity Related to Unrecognized Tax Benefits | The following table summarizes the activity related to unrecognized tax benefits: (In millions) 2022 2021 2020 Beginning balance $ 13 $ 13 $ 13 Decrease related to prior year tax positions (3 ) — — Ending balance $ 10 $ 13 $ 13 |
EARNINGS (LOSS) PER SHARE (Tabl
EARNINGS (LOSS) PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Calculation of Earnings (Loss) Per Common Share | The following table presents the calculation of net earnings (loss) per common share — basic and diluted: (In millions, except per share amounts) 2022 2021 2020 Basic Earnings (Loss) Per Share Numerator: Net income (loss) from continuing operations $ 178 $ 187 $ (63 ) Loss from discontinued operations, net of tax (12 ) (395 ) (256 ) Net income (loss) $ 166 $ (208 ) $ (319 ) Denominator: Weighted-average shares outstanding 48 53 53 Basic earnings (loss) per share: Continuing operations $ 3.73 $ 3.54 $ (1.20 ) Discontinued operations (0.25 ) (7.47 ) (4.85 ) Net basic earnings (loss) per share $ 3.48 $ (3.93 ) $ (6.05 ) Diluted Earnings (Loss) Per Share Numerator: Net income (loss) from continuing operations $ 178 $ 187 $ (63 ) Loss from discontinued operations, net of tax (12 ) (395 ) (256 ) Net income (loss) $ 166 $ (208 ) $ (319 ) Denominator: Weighted-average shares outstanding 48 53 53 Effect of dilutive securities: Stock options and restricted stock 1 2 — Diluted weighted-average shares outstanding 49 55 53 Diluted earnings (loss) per share Continuing operations $ 3.61 $ 3.42 $ (1.20 ) Discontinued operations (0.24 ) (7.21 ) (4.85 ) Net diluted earnings (loss) per share $ 3.37 $ (3.79 ) $ (6.05 ) |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Schedule of Property and Equipment | Property and equipment consists of: December 31, December 25, (In millions) 2022 2021 Land $ 30 $ 45 Buildings 79 200 Computer software 764 693 Leasehold improvements 565 587 Furniture, fixtures and equipment 753 775 Construction in progress 17 12 2,208 2,312 Less accumulated depreciation (1,856 ) (1,835 ) Total $ 352 $ 477 |
Estimated Future Amortization Expense for Intangible Assets | Estimated future amortization expense related to capitalized software at December 31, 2022 is as follows: (In millions) 2023 $ 45 2024 38 2025 31 2026 21 2027 9 Thereafter 1 |
Assets Held Under Finance Leases | |
Schedule of Property and Equipment | The above table of property and equipment includes assets held under finance leases as follows: December 31, December 25, (In millions) 2022 2021 Buildings $ 11 $ 19 Furniture, fixtures and equipment 143 143 154 162 Less accumulated depreciation (125 ) (123 ) Total $ 29 $ 39 |
GOODWILL AND OTHER INTANGIBLE_2
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill by Segment | Goodwill and indefinite-lived intangible assets are tested for impairment annually as of the first day of fiscal December or more frequently when events or changes in circumstances indicate that impairment may have occurred. The changes in reportable segments described in Note 3 also resulted in the change of the Company’s reporting units during the third quarter of 2022, where each reportable segment also represents a reporting unit. Goodwill was allocated to the new reporting units using their relative fair values. (In millions) Balance as of December 25, 2021 Allocation to New segment Balance as of December 31, 2022 Business Solutions Division $ 318 $ (318 ) $ — Retail Division 78 (78 ) — ODP Business Solutions Division — 142 142 Office Depot Division — 219 219 Veyer Division — 35 35 Varis Division 68 — 68 Total $ 464 $ — $ 464 |
Schedule of Amortizing Intangible Assets Net | Definite-lived intangible assets, which are included in Other intangible assets, net in the Consolidated Balance Sheets, are as follows: December 31, 2022 (In millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 122 $ (90 ) $ 32 Technology 6 (5 ) 1 Total $ 128 $ (95 ) $ 33 December 25, 2021 (In millions) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Customer relationships $ 122 $ (84 ) $ 38 Technology 6 (2 ) 4 Total $ 128 $ (86 ) $ 42 |
Estimated Future Amortization Expense for Intangible Assets | Estimated future amortization expense for the intangible assets is as follows: (In millions) 2023 $ 5 2024 3 2025 3 2026 3 2027 3 Thereafter 16 Total $ 33 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt consists of the following: December 31, December 25, (In millions) 2022 2021 Short-term borrowings and current maturities of long-term debt: Finance lease obligations $ 14 $ 17 Other current maturities of long-term debt 2 3 Total $ 16 $ 20 Long-term debt, net of current maturities: New Facilities loans under the Third Amended Credit Agreement, due 2025 57 100 Revenue bonds, due in varying amounts periodically through 2029 75 75 American & Foreign Power Company, Inc. 5% debentures, due 2030 15 15 Finance lease obligations 24 35 Other financing obligations 1 3 Total $ 172 $ 228 |
Schedule of Maturities of Recourse Debt, Finance Lease and Other Financing Obligations | Aggregate annual maturities of recourse debt, finance lease, and other financing obligations are as follows: (In millions) 2023 $ 18 2024 10 2025 64 2026 36 2027 33 Thereafter 30 Total 191 Less interest on finance leases (3 ) Total 188 Less: Current portion (16 ) Total long-term debt $ 172 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Components of Lease Expense | The components of lease expense were as follows: (In millions) 2022 2021 2020 Finance lease cost: Amortization of right-of-use assets $ 14 $ 18 $ 18 Interest on lease liabilities 2 3 4 Operating lease cost 334 350 402 Short-term lease cost 6 4 6 Variable lease cost 94 99 112 Sublease income (2 ) (2 ) (2 ) Total lease cost $ 448 $ 472 $ 540 |
Supplemental Cash Flow Information Related to Leases | Supplemental cash flow information related to leases was as follows: (In millions) 2022 2021 2020 Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from finance leases $ 2 $ 3 $ 4 Operating cash flows from operating leases 370 408 447 Financing cash flows from finance leases 18 22 20 Right-of-use assets obtained in exchange for new finance lease liabilities 4 3 29 Right-of-use assets obtained in exchange for new operating lease liabilities 228 127 117 |
Supplemental Balance Sheets Information Related to Leases | Supplemental balance sheets information related to leases was as follows: December 31, December 25, (In millions, except lease term and discount rate) 2022 2021 Property and equipment, net $ 29 $ 39 Operating lease right-of-use assets 874 936 Accrued expenses and other current liabilities 281 304 Short-term borrowings and current maturities of long-term debt 14 17 Long-term debt, net of current maturities 24 35 Operating lease liabilities 693 753 Weighted-average remaining lease term – finance leases 3 4 Weighted-average remaining lease term – operating leases 5 5 Weighted-average discount rate – finance leases 4.9 % 5.0 % Weighted-average discount rate – operating leases 6.1 % 5.8 % |
Schedule of Maturities of Lease Liabilities Under Operating and Finance Leases | Maturities of lease liabilities as of December 31, 2022 were as follows: December 31, 2022 Operating Finance (In millions) Leases ( 1) Leases ( 2) 2023 $ 333 $ 15 2024 251 10 2025 182 7 2026 142 5 2027 96 3 Thereafter 125 1 1,129 41 Less imputed interest (155 ) (3 ) Total $ 974 $ 38 Reported as of December 31, 2022 Accrued expenses and other current liabilities $ 281 $ — Short-term borrowings and current maturities of long-term debt — 14 Long-term debt, net of current maturities — 24 Operating lease liabilities 693 — Total $ 974 $ 38 (1) Operating lease payments include $47 million related to options to extend lease terms that are reasonably certain of being exercised. (2) Finance lease payments include $1 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Loss Activity, Net of Tax | Accumulated other comprehensive loss activity, net of tax, where applicable, is provided in the following tables: (In millions) Foreign Currency Translation Adjustments Change in Deferred Pension Total Balance at December 25, 2021 $ (27 ) $ 21 $ (6 ) Other comprehensive income activity before reclassifications (18 ) (62 ) (80 ) Reclassification of foreign currency translation adjustments realized upon disposal of business 6 6 Tax impact — 3 3 Total other comprehensive income, net of tax, where applicable (12 ) (59 ) (71 ) Balance at December 31, 2022 $ (39 ) $ (38 ) $ (77 ) (In millions) Foreign Currency Translation Adjustments Change in Deferred Pension Total Balance at December 26, 2020 $ (27 ) $ (5 ) $ (32 ) Other comprehensive income activity — 32 32 Tax impact — (6 ) (6 ) Total other comprehensive income, net of tax, where applicable — 26 26 Balance at December 25, 2021 $ (27 ) $ 21 $ (6 ) |
STOCK-BASED COMPENSATION (Table
STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Status of Company's Nonvested Shares | A summary of the status of the Company’s nonvested shares and changes during 2022, 2021 and 2020 is presented below. 2022 2021 2020 Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Outstanding at beginning of year 1,386,778 $ 30.48 1,526,653 $ 24.71 1,394,756 $ 30.40 Granted 933,487 42.81 521,512 39.55 835,828 19.92 Vested (585,563 ) 29.65 (593,249 ) 23.72 (579,584 ) 30.71 Forfeited (203,740 ) 36.29 (68,138 ) 29.20 (124,347 ) 28.60 Outstanding at end of year 1,530,962 $ 37.54 1,386,778 $ 30.48 1,526,653 $ 24.71 |
Summary of Performance Based Long Term Incentive Program | A summary of the activity in the performance-based long-term incentive program since inception is presented below. 2022 2021 2020 Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Shares Weighted Average Grant- Date Price Outstanding at beginning of year 2,175,831 $ 29.33 2,458,978 $ 24.22 1,994,111 $ 29.05 Granted 421,038 45.01 1,298,868 41.44 932,344 19.42 Vested (796,019 ) 29.71 (1,374,442 ) 23.47 (151,905 ) 41.80 Forfeited (343,125 ) 30.21 (207,573 ) 28.71 (315,572 ) 27.10 Outstanding at end of year ( 2) 1,457,725 $ 31.84 2,175,831 $ 29.33 2,458,978 $ 24.22 (1) Outstanding shares at the end of 2022 include 5 million shares of awards granted in 2020 that will be settled in cash in 2023. These awards are remeasured to fair value at each reporting period. The remeasurement impact was not material in 2022, 2021, and 2020. |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Compensation And Retirement Disclosure [Abstract] | |
Changes in Pension and Other Postretirement Benefit Obligations, Plan Assets and Funded Status | The following table provides a reconciliation of changes in the projected benefit obligation and the fair value of plan assets, as well as the funded status of the plans to amounts recognized on the Company’s Consolidated Balance Sheets. Pension Benefits Other Benefits (In millions) 2022 2021 2022 2021 Changes in projected benefit obligation: Obligation at beginning of period $ 830 $ 924 $ 13 $ 14 Service cost — — — — Interest cost 21 20 — Assumption changes (144 ) (28 ) (3 ) — Actuarial gain (9 ) (12 ) — — Currency exchange rate change — — — — Benefits paid (71 ) (74 ) (1 ) (1 ) Obligation at end of period $ 627 $ 830 $ 9 $ 13 Change in plan assets: Fair value of plan assets at beginning of period $ 836 $ 894 $ — $ — Actual return on plan assets (142 ) 14 — — Employer contribution 2 2 1 1 Benefits paid (71 ) (74 ) (1 ) (1 ) Fair value of plan assets at end of period 625 836 — — Net asset (liability) recognized at end of period $ (2 ) $ 6 $ (9 ) $ (13 ) The following table provides a reconciliation of changes in the projected benefit obligation, the fair value of plan assets and the funded status of the plan to amounts recognized on the Company’s Consolidated Balance Sheets. (In millions) 2022 2021 Changes in projected benefit obligation: Obligation at beginning of period $ 257 $ 269 Service cost — — Interest cost 4 4 Plan settlements — (7 ) Benefits paid (8 ) (5 ) Actuarial (gain) loss (89 ) (1 ) Currency translation (23 ) (3 ) Obligation at end of period 141 257 Changes in plan assets: Fair value of plan assets at beginning of period 358 360 Actual return on plan assets (130 ) 12 Company contributions 1 2 Plan settlements — (7 ) Benefits paid (8 ) (4 ) Currency translation (32 ) (5 ) Fair value of plan assets at end of period 189 358 Net asset recognized at end of period $ 48 $ 101 |
Amount Recognized in Consolidated Balance Sheets Related to Defined Benefit Pension and Other Postretirement Benefit Plans | The following table shows the amounts recognized in the Consolidated Balance Sheets related to the Company’s North America defined benefit pension and other postretirement benefit plans as of year-ends: Pension Benefits Other Benefits (In millions) 2022 2021 2022 2021 Noncurrent assets $ 7 $ 18 $ — $ — Current liabilities (1 ) (2 ) (1 ) (1 ) Noncurrent liabilities (8 ) (10 ) (8 ) (12 ) Net amount recognized $ (2 ) $ 6 $ (9 ) $ (13 ) |
Accumulated Benefit Obligation in Excess of Plan Assets | The following table provides the accumulated benefit obligation for the Company’s North America defined benefit pension and other postretirement benefit plans with a projected benefit obligation and an accumulated benefit obligation in excess of plan assets as of year ends: Pension Benefits Other Benefits (In millions) 2022 2021 2022 2021 Accumulated benefit obligation in excess of plan assets Accumulated benefit obligation at end of period $ (9 ) $ (11 ) $ (9 ) $ (13 ) Fair value of plan assets at end of period — — — — Projected benefit obligation in excess of plan assets Benefit obligation at end of period (9 ) (11 ) Fair value of plan assets at end of period — — |
Components of Net Periodic Benefit | The components of net periodic benefit are as follows: Pension Benefits Other Benefits (In millions) 2022 2021 2020 2022 2021 2020 Service cost $ — $ — $ — $ — $ — $ — Interest cost 21 20 28 — — — Expected return on plan assets (26 ) (29 ) (32 ) — — — Net periodic benefit $ (5 ) $ (9 ) $ (4 ) $ — $ — $ — The components of net periodic benefit are presented below: (In millions) 2022 2021 2020 Service cost $ — $ — $ — Interest cost 4 4 5 Expected return on plan assets (6 ) (6 ) (5 ) Settlement gain — (1 ) — Net periodic pension benefit $ (2 ) $ (3 ) $ — |
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Loss (Income) | Other changes in plan assets and benefit obligations recognized in other comprehensive loss (income) are as follows: Pension Benefits Other Benefits (In millions) 2022 2021 2020 2022 2021 2020 Accumulated other comprehensive loss (income) at beginning of year $ (46 ) $ (21 ) $ 9 $ — $ 1 $ — Net loss (gain) 15 (25 ) (30 ) (2 ) (1 ) 1 Accumulated other comprehensive loss (income) at end of year $ (31 ) $ (46 ) $ (21 ) $ (2 ) $ — $ 1 |
Weighted Average Assumptions Used in the Measurement of Benefit Obligations and Net Periodic Cost (Benefit) | The following table presents the key weighted average assumptions used in the measurement of the Company’s benefit obligations as of year-ends: Other Benefits Pension Benefits United States Canada 2022 2021 2020 2022 2021 2020 2022 2021 2020 Discount rate 5.37 % 2.69 % 2.27 % 4.90 % 2.40 % 1.90 % 5.10 % 2.90 % 2.50 % The following table presents the weighted average assumptions used in the measurement of net periodic benefit: Other Benefits Pension Benefits United States Canada 2022 2021 2020 2022 2021 2020 2022 2021 2020 Discount rate 2.69 % 2.27 % 3.26 % 2.40 % 1.90 % 2.80 % 2.90 % 2.50 % 3.10 % Expected long-term rate of return on plan assets 3.64 % 4.31 % 5.16 % — % — % — % — % — % — % Assumptions used in calculating the funded status and net periodic benefit included: 2022 2021 2020 Expected long-term rate of return on plan assets 3.47 % 2.03 % 1.64 % Discount rate 5.00 % 1.80 % 1.40 % Inflation 3.00 % 3.20 % 2.70 % |
Assumed Healthcare Cost Trend Rates | The following table presents the assumed healthcare cost trend rates used in measuring the Company’s postretirement benefit obligations at year-ends: 2022 2021 2020 Weighted average assumptions as of year-end: Healthcare cost trend rate assumed for next year 6.10 % 6.20 % 6.10 % Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) 4.00 % 4.00 % 4.50 % Year that the rate reaches the ultimate trend rate 2041 2041 2029 |
Allocation of Plan Assets Table | The allocation of pension plan assets by category at year-ends is as follows: 2022 2021 Cash 1 % 1 % Common collective trust funds 99 % 99 % 100 % 100 % The allocation of Plan assets is as follows: 2022 2021 Cash — % 2 % Equity securities 5 % 14 % Fixed-income securities 95 % 84 % Total 100 % 100 % |
Schedule of Fair Value of Plan Assets by Assets Category | The following table presents the pension plan assets by level within the fair value hierarchy at year-ends. (In millions) Fair Value Measurements 2022 Asset Category Total Assets Measured at NAV (a) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Plan assets measured at net asset value: (a) Common collective trust funds: U.S. small and mid-cap equity securities $ 5 $ 5 $ — $ — $ — U.S. large cap equity securities 20 20 — — — International equity securities 31 31 — — — Corporate bonds 281 281 — — — Government securities 254 254 — — — Other fixed-income — — — — — Cash 29 29 — — — Total common collective trust funds 620 620 — — — Total plan assets measured at net asset value 620 620 — — — Plan assets measured in the fair value hierarchy: Cash 5 5 — — Total plan assets measured in the fair value hierarchy 5 — 5 — — Total plan assets $ 625 $ 620 $ 5 $ — $ — (a) Fair values of Common collective trust funds are estimated using net asset value per unit as a practical expedient which are excluded from the disclosure requirement to classify amounts in the fair value hierarchy in connection with the adoption of Accounting Standards Update (ASU) 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). (In millions) Fair Value Measurements 2021 Asset Category Total Assets Measured at NAV (a) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Plan assets measured at net asset value: (a) Common collective trust funds: U.S. small and mid-cap equity securities $ 7 $ 7 $ — $ — $ — U.S. large cap equity securities 29 29 — — — International equity securities 42 42 — — — Corporate bonds 485 485 — — — Government securities 245 245 — — — Other fixed-income 4 4 — — — Cash 18 18 — — — Total common collective trust funds 830 830 — — — Total plan assets measured at net asset value 830 830 — — — Plan assets measured in the fair value hierarchy: Cash 6 — 6 — — Total plan assets measured in the fair value hierarchy 6 — 6 — — Total plan assets $ 836 $ 830 $ 6 $ — $ — (a) Fair values of Common collective trust funds are estimated using net asset value per unit as a practical expedient which are excluded from the disclosure requirement to classify amounts in the fair value hierarchy in connection with the adoption of Accounting Standards Update (ASU) 2015-07, Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). The following table presents the pension plan assets by level within the fair value hierarchy. (In millions) Fair Value Measurements 2022 Asset Category Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash $ 1 $ 1 $ — $ — Equity securities Developed market equity funds — — — — Emerging market equity funds — — — — Mutual funds real estate — — — — Mutual funds 9 — 9 — Total equity securities 9 — 9 — Fixed-income securities UK debt funds 86 — 86 — Liability term matching debt funds 76 — 76 — Emerging market debt fund — — — — High yield debt 17 — 17 — Total fixed-income securities 179 — 179 — Total $ 189 $ 1 $ 188 $ — (In millions) Fair Value Measurements 2021 Asset Category Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Cash $ 9 $ 9 $ — $ — Equity securities Developed market equity funds 13 13 — — Emerging market equity funds 4 4 — — Mutual funds real estate 2 — — 2 Mutual funds 30 — 30 — Total equity securities 49 17 30 2 Fixed-income securities UK debt funds 154 — 154 — Liability term matching debt funds 115 — 115 — Emerging market debt fund 2 — 2 — High yield debt 29 — 29 — Total fixed-income securities 300 — 300 — Total $ 358 $ 26 $ 330 $ 2 |
Anticipated Benefit Payments | Anticipated benefit payments by year are as follows: (In millions) Pension Benefits Other Benefits 2023 $ 70 $ 1 2024 67 1 2025 64 1 2026 61 1 2027 59 1 Next five years 247 3 Anticipated benefit payments for the UK pension plan, at 2022 year-end exchange rates, are as follows: (In millions) Benefit Payments 2023 $ 9 2024 9 2025 9 2026 9 2027 10 Next five years 52 |
Reconciliation of the Change in Fair Value of the Pension Plan Assets Calculated based on Level 3 Inputs | The following is a reconciliation of the change in fair value of the pension plan assets calculated based on Level 3 inputs: (In millions) Total Balance at December 25, 2021 $ 2 Net sales (2 ) Balance at December 31, 2022 $ — |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Assets and Liabilities | The following table presents information about financial instruments at the balance sheet dates indicated. December 31, December 25, 2022 2021 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Financial assets: Company-owned life insurance 138 138 137 137 Financial liabilities: Long-term debt: New Facilities loans under the Third Amended Credit Agreement, due 2025 57 57 100 100 Revenue bonds, due in varying amounts periodically through 2029 75 76 75 76 American & Foreign Power Company, Inc. 5% debentures, due 2030 15 14 15 16 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Discontinued Operations And Disposal Groups [Abstract] | |
Major Component of Discontinued Operations, Net of Tax and Major Classes of Assets and Liabilities of Disposal Group Classified as Held for Sale | The following table represents a reconciliation of the major components of Discontinued operations, net of tax presented in the Consolidated Statements of Operations. (In millions) 2022 2021 2020 Major components of discontinued operations before income taxes: Sales $ — $ 802 $ 838 Cost of goods and occupancy costs - 645 657 Gross profit — 157 181 Selling, general and administrative expenses — 152 171 Asset impairments — 252 248 Merger, restructuring and other operating expenses, net — (2 ) 20 Operating loss — (245 ) (258 ) Other income (expense), net — (1 ) 1 Loss from major components of discontinued operations before income taxes — (246 ) (257 ) Loss from classification to held for sale (13 ) (170 ) — Loss from discontinued operations before income taxes (13 ) (416 ) (257 ) Income tax benefit (1 ) (21 ) (1 ) Discontinued operations, net of tax $ (12 ) $ (395 ) $ (256 ) The following table represents the major classes of assets and liabilities of the disposal group classified as held for sale presented in the Consolidated Balance Sheet as of December 25, 2021. The Company completed the sale of CompuCom on December 31, 2021, and therefore no assets or liabilities are included in discontinued operations as of December 31, 2022. December 25, (In millions) 2021 Major classes of assets included in discontinued operations: Cash and cash equivalents $ 23 Receivables, net 221 Inventories 20 Prepaid expenses and other current assets 15 Property and equipment, net 25 Operating lease right-of-use assets 66 Other intangible assets, net 255 Other assets 14 Less: valuation allowance (170 ) Total assets of the disposal group classified as held for sale $ 469 Major classes of liabilities included in discontinued operations: Trade accounts payable $ 83 Accrued expenses and other current liabilities 86 Deferred income taxes and other long-term liabilities 75 Operating lease liabilities 46 Total liabilities of the disposal group classified as held for sale $ 290 |
QUARTERLY FINANCIAL DATA (UNA_2
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Data | (In millions, except per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year Ended December 31, 2022* Net sales $ 2,178 $ 2,034 $ 2,172 $ 2,106 Gross profit 484 431 486 446 Operating income (1) 76 28 84 55 Net income from continuing operations 55 20 67 36 Discontinued operations, net of tax — 7 — (19 ) Net income 55 27 67 17 Basic earnings (loss) per share (2) Continuing operations $ 1.14 $ 0.40 $ 1.39 $ 0.79 Discontinued operations — 0.15 (0.01 ) (0.41 ) Net basic earnings per share $ 1.14 $ 0.55 $ 1.38 $ 0.38 Diluted earnings (loss) per share (2) Continuing operations $ 1.09 $ 0.39 $ 1.36 $ 0.76 Discontinued operations — 0.15 (0.01 ) (0.40 ) Net diluted earnings per share $ 1.09 $ 0.54 $ 1.35 $ 0.36 * Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year. (1 ) Includes Merger, restructuring and other operating expenses, net totaling $10 million, $23 million, $8 million and ($3) million in the first, second, third and fourth quarters of 2022 , ( 2 ) The sum of the quarterly earnings (loss) per share does not equal the annual earnings (loss) per share due to differences in quarterly and annual weighted-average shares outstanding. (In millions, except per share amounts) First Quarter Second Quarter Third Quarter Fourth Quarter Fiscal Year Ended December 25, 2021* Net sales $ 2,174 $ 2,070 $ 2,179 $ 2,042 Gross profit 495 432 504 432 Operating income (3) 69 30 104 31 Net income from continuing operations 63 20 73 32 Discontinued operations, net of tax (10 ) (108 ) 28 (306 ) Net income (loss) 53 (88 ) 101 (274 ) Basic earnings (loss) per share (4) Continuing operations $ 1.17 $ 0.36 $ 1.38 $ 0.63 Discontinued operations (0.18 ) (1.98 ) 0.54 (6.07 ) Net basic earnings (loss) per share $ 0.99 $ (1.62 ) $ 1.92 $ (5.44 ) Diluted earnings (loss) per share (4) Continuing operations $ 1.12 $ 0.35 $ 1.33 $ 0.61 Discontinued operations (0.17 ) (1.93 ) 0.52 (5.87 ) Net diluted earnings (loss) per share $ 0.95 $ (1.58 ) $ 1.85 $ (5.26 ) * Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year. ( 3 ) Includes Merger, restructuring and other operating expenses, net totaling $13 million, $11 million, $13 million and $14 million in the first, second, third and fourth quarters of 2021, respectively. The first, second, third and fourth quarters of 2021 also include asset impairments of $12 million, $1 million, $5 million and $2 million, respectively. ( 4 ) The sum of the quarterly earnings (loss) per share does not equal the annual earnings (loss) per share due to differences in quarterly and annual weighted-average shares outstanding. |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2022 USD ($) Customer | Sep. 24, 2022 USD ($) Segment | Jun. 25, 2022 USD ($) Segment | Mar. 26, 2022 USD ($) | Dec. 25, 2021 USD ($) Customer | Sep. 25, 2021 USD ($) | Jun. 26, 2021 USD ($) | Mar. 27, 2021 USD ($) | Sep. 24, 2022 Division | Dec. 31, 2022 USD ($) Segment Customer | Dec. 25, 2021 USD ($) Customer | Dec. 26, 2020 USD ($) Customer | |
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Percent of subsidiary shares owned | 88% | |||||||||||
Number of reportable segments | 4 | 2 | 4 | 4 | ||||||||
Percentage of service revenue post discontinued operation | 10% | |||||||||||
Accounts payable and accrued expenses and other current liabilities not yet presented for payment | $ 16,000,000 | $ 0 | $ 16,000,000 | $ 0 | ||||||||
Current liabilities held for sale not yet presented for payment | 1,000,000 | 1,000,000 | ||||||||||
Cash and cash equivalents | 403,000,000 | 514,000,000 | 403,000,000 | 514,000,000 | ||||||||
Restricted cash | $ 1,000,000 | $ 0 | $ 1,000,000 | $ 0 | ||||||||
Restricted Cash And Cash Equivalents Current Asset Statement Of Financial Position Extensible List | Prepaid expenses and other current assets | Prepaid expenses and other current assets | Prepaid expenses and other current assets | Prepaid expenses and other current assets | ||||||||
Trade receivables | $ 536,000,000 | $ 495,000,000 | $ 536,000,000 | $ 495,000,000 | ||||||||
Number of customers accounted for more than 10% of total sales | Customer | 0 | 0 | 0 | |||||||||
Number of customers accounted for more than 10% of receivables | Customer | 0 | 0 | 0 | 0 | 0 | |||||||
Other receivables | $ 123,000,000 | $ 143,000,000 | $ 123,000,000 | $ 143,000,000 | ||||||||
Accrued payroll and benefits | 158,000,000 | 148,000,000 | 158,000,000 | 148,000,000 | ||||||||
Short-term contract liabilities | 41,000,000 | 52,000,000 | 41,000,000 | 52,000,000 | ||||||||
Revenue recognition included in short-term contract liabilities | 27,000,000 | 24,000,000 | ||||||||||
Recognition of contract assets as a result of business combination | 0 | 0 | ||||||||||
Recognition of contract liabilities as a result of business combination | 0 | 2,000,000 | ||||||||||
Significant adjustment to revenue from performance obligations | 0 | 0 | ||||||||||
Contract with customer, asset, reclassified to receivable | 0 | 0 | ||||||||||
Short-term contract assets | 8,000,000 | 16,000,000 | 8,000,000 | 16,000,000 | ||||||||
Long-term contract assets | 2,000,000 | 8,000,000 | 2,000,000 | 8,000,000 | ||||||||
Long-term contract liabilities | 2,000,000 | 2,000,000 | ||||||||||
Capitalized contract cost, amortization | 20,000,000 | 24,000,000 | $ 29,000,000 | |||||||||
Impairment charges related to contract assets | 6,000,000 | $ 3,000,000 | $ 3,000,000 | $ 2,000,000 | 2,000,000 | $ 5,000,000 | $ 1,000,000 | $ 12,000,000 | 14,000,000 | 20,000,000 | 182,000,000 | |
Advertising expenses | 130,000,000 | 139,000,000 | 177,000,000 | |||||||||
Prepaid advertising expenses | 3,000,000 | 4,000,000 | $ 3,000,000 | 4,000,000 | ||||||||
Lessee, operating lease, existence of option to extend [true false] | true | |||||||||||
Contract Assets | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Impairment charges related to contract assets | $ 0 | 0 | $ 0 | |||||||||
CompuCom Division | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Short-term contract liabilities | 10,000,000 | 10,000,000 | ||||||||||
Short-term contract assets | $ 1,000,000 | $ 1,000,000 | ||||||||||
Long-term contract assets | 1,000,000 | 1,000,000 | ||||||||||
Long-term contract liabilities | 2,000,000 | 2,000,000 | ||||||||||
Minimum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Extend renewal terms of the lease | 5 years | 5 years | ||||||||||
Maximum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Extend renewal terms of the lease | 25 years | 25 years | ||||||||||
Buildings | Minimum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 15 years | |||||||||||
Buildings | Maximum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 30 years | |||||||||||
Furniture, fixtures and equipment | Minimum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 3 years | |||||||||||
Furniture, fixtures and equipment | Maximum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 10 years | |||||||||||
Computer Software for Common Office Applications | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 3 years | |||||||||||
Computer Software for Larger Business Application | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 5 years | |||||||||||
Computer Software for Enterprise Wide Systems | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 7 years | |||||||||||
Software | Minimum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 3 years | |||||||||||
Software | Maximum | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Estimated useful lives of depreciable assets, years | 7 years | |||||||||||
Trade Receivables | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Trade receivables | $ 412,000,000 | 353,000,000 | $ 412,000,000 | 353,000,000 | ||||||||
Allowance for doubtful accounts | 8,000,000 | 9,000,000 | 8,000,000 | 9,000,000 | ||||||||
Vendor Arrangements Receivables | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Other receivables | 82,000,000 | 104,000,000 | 82,000,000 | 104,000,000 | ||||||||
Accrued Expenses and Other Current Liabilities | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Short-term contract liabilities | 15,000,000 | 12,000,000 | 15,000,000 | 12,000,000 | ||||||||
Non-US | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Cash and cash equivalents | 113,000,000 | $ 108,000,000 | 113,000,000 | $ 108,000,000 | ||||||||
Non-US | Current Asset Held For Sale | ||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||
Cash and cash equivalents | $ 17,000,000 | $ 17,000,000 |
Summary of Receivables, Contrac
Summary of Receivables, Contract Assets and Contract Liabilities from Contracts with Customers (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Contract With Customer Asset And Liability [Abstract] | ||
Trade receivables, net | $ 412 | $ 353 |
Short-term contract assets | 8 | 16 |
Long-term contract assets | 2 | 8 |
Short-term contract liabilities | $ 41 | 52 |
Long-term contract liabilities | $ 2 |
Summary of Major Components of
Summary of Major Components of Merger and Restructuring Expenses, Net (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Merger and transaction related expenses | |||
Transaction and integration | $ (7) | $ 4 | |
Facility closure, contract termination and other expenses, net | 1 | ||
Total Merger and transaction related expenses | (7) | 5 | |
Restructuring expenses | |||
Severance | (13) | $ (2) | 41 |
Professional fees | 1 | 21 | |
Facility closure, contract termination, and other expenses, net | 5 | 15 | 35 |
Total Restructuring expenses, net | (8) | 14 | 97 |
Other operating expenses | |||
Professional fees | 54 | 37 | |
Total Other operating expenses | 54 | 37 | |
Total Merger, restructuring and other operating expenses, net | $ 39 | $ 51 | $ 102 |
Merger, Restructuring and Oth_3
Merger, Restructuring and Other Activity - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | 12 Months Ended | 24 Months Ended | |||
Sep. 24, 2022 Segment | Jun. 25, 2022 Segment | Sep. 24, 2022 Division | Dec. 31, 2022 USD ($) Segment Store | Dec. 25, 2021 USD ($) Store | Dec. 26, 2020 USD ($) Facility | Dec. 31, 2022 USD ($) | |
Merger Restructuring And Other Activity [Line Items] | |||||||
Merger transaction income impact of earnout adjustments on acquisition | $ 7,000,000 | ||||||
Transaction and integration expenses | 0 | $ 0 | $ 5,000,000 | ||||
Restructuring Reserve | 12,000,000 | 28,000,000 | 42,000,000 | $ 12,000,000 | |||
Costs to implement restructuring plan | 44,000,000 | 44,000,000 | |||||
Restructuring cash expenditure | $ 60,000,000 | 58,000,000 | |||||
Number of reportable segments | 4 | 2 | 4 | 4 | |||
Professional fees | 1,000,000 | 21,000,000 | |||||
USR Parent, Inc. | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Professional fees | $ 5,000,000 | ||||||
Third-Party Professional Fees | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | $ 3,000,000 | ||||||
Maximize B2 B Restructuring Plan | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Number of retail stores closed | Store | 56 | 181 | |||||
Number of distribution facilities closed | Facility | 2 | ||||||
Restructuring Reserve | $ 8,000,000 | 8,000,000 | |||||
Costs to implement restructuring plan | 81,000,000 | ||||||
Restructuring cash expenditure | 8,000,000 | ||||||
Maximize B2 B Restructuring Plan | Maximum | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | 95,000,000 | ||||||
Maximize B2 B Restructuring Plan | Cash Expenditure | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | $ 61,000,000 | ||||||
Maximize B2 B Restructuring Plan | Facility Closing | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | 5,000,000 | ||||||
Maximize B2 B Restructuring Plan | Employee Severance | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | 13,000,000 | ||||||
Business Acceleration Program | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | $ 19,000,000 | ||||||
Planned Separation of Consumer Business | Third-Party Professional Fees | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | 33,000,000 | $ 32,000,000 | |||||
Re-alignment | Third-Party Professional Fees | |||||||
Merger Restructuring And Other Activity [Line Items] | |||||||
Costs to implement restructuring plan | $ 21,000,000 |
Severance and Facility Closure
Severance and Facility Closure Costs (Detail) - USD ($) $ in Millions | 12 Months Ended | 24 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | Dec. 31, 2022 | |
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | $ 28 | $ 42 | $ 42 | |
Charges Incurred | 44 | 44 | ||
Cash Payments | (60) | (58) | ||
Ending Balance | 12 | 28 | $ 42 | 12 |
Maximize B2 B Restructuring Plan | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Charges Incurred | 81 | |||
Cash Payments | (8) | |||
Ending Balance | 8 | 8 | ||
Business Acceleration Program | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Charges Incurred | 19 | |||
Termination Benefits | Maximize B2 B Restructuring Plan | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 19 | 27 | 27 | |
Charges Incurred | (13) | (2) | ||
Cash Payments | (1) | (6) | ||
Ending Balance | 5 | 19 | 27 | 5 |
Termination Benefits | Business Acceleration Program | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 2 | 2 | ||
Cash Payments | (2) | |||
Ending Balance | 2 | |||
Lease and contract obligations, accruals for facilities closures and other costs | Maximize B2 B Restructuring Plan | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 6 | 10 | 10 | |
Charges Incurred | 5 | 9 | ||
Cash Payments | (7) | (13) | ||
Ending Balance | 4 | 6 | 10 | 4 |
Lease and contract obligations, accruals for facilities closures and other costs | Previously Planned Separation of Consumer Business and Re-alignment | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 2 | |||
Charges Incurred | 52 | |||
Cash Payments | (52) | |||
Ending Balance | 2 | 2 | 2 | |
Lease and contract obligations, accruals for facilities closures and other costs | Comprehensive Business Review | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 1 | 2 | 2 | |
Cash Payments | (1) | |||
Ending Balance | 1 | 1 | 2 | 1 |
Lease and contract obligations, accruals for facilities closures and other costs | USR Parent, Inc. Proposals | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Charges Incurred | 5 | |||
Cash Payments | (5) | |||
Lease and contract obligations, accruals for facilities closures and other costs | Planned Separation of Consumer Business | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | $ 2 | |||
Charges Incurred | 32 | |||
Cash Payments | (30) | |||
Ending Balance | 2 | |||
Lease and contract obligations, accruals for facilities closures and other costs | Business Acceleration Program | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Beginning Balance | 1 | $ 1 | ||
Cash Payments | $ (1) | |||
Ending Balance | $ 1 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 24, 2022 Segment | Jun. 25, 2022 Segment | Sep. 24, 2022 Division | Dec. 31, 2022 Segment Location | |
Segment Reporting [Abstract] | ||||
Number of reportable segments | 4 | 2 | 4 | 4 |
Number of office depot and officemax retail locations | 980 |
Reconciliation of Revenue from
Reconciliation of Revenue from Segments to Consolidated (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2022 | [1] | Sep. 24, 2022 | [1] | Jun. 25, 2022 | [1] | Mar. 26, 2022 | [1] | Dec. 25, 2021 | [1] | Sep. 25, 2021 | [1] | Jun. 26, 2021 | [1] | Mar. 27, 2021 | [1] | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | $ 2,106 | $ 2,172 | $ 2,034 | $ 2,178 | $ 2,042 | $ 2,179 | $ 2,070 | $ 2,174 | $ 8,491 | $ 8,465 | $ 8,872 | ||||||||
Division operating income (loss) | 387 | 393 | 396 | ||||||||||||||||
External | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 8,491 | 8,465 | 8,872 | ||||||||||||||||
Eliminations | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | (5,910) | (6,021) | (6,385) | ||||||||||||||||
Eliminations | Internal | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | (5,910) | (6,021) | (6,385) | ||||||||||||||||
ODP Business Solutions Division | Operating Segments | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 4,024 | 3,626 | 3,578 | ||||||||||||||||
Division operating income (loss) | 140 | 72 | 51 | ||||||||||||||||
ODP Business Solutions Division | Operating Segments | External | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 4,005 | 3,602 | 3,549 | ||||||||||||||||
ODP Business Solutions Division | Operating Segments | Internal | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 19 | 24 | 29 | ||||||||||||||||
Office Depot Division | Operating Segments | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 4,487 | 4,864 | 5,335 | ||||||||||||||||
Division operating income (loss) | 285 | 325 | 317 | ||||||||||||||||
Office Depot Division | Operating Segments | External | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 4,451 | 4,830 | 5,300 | ||||||||||||||||
Office Depot Division | Operating Segments | Internal | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 36 | 34 | 35 | ||||||||||||||||
Veyer Division | Operating Segments | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 5,883 | 5,991 | 6,344 | ||||||||||||||||
Division operating income (loss) | 28 | 30 | 28 | ||||||||||||||||
Veyer Division | Operating Segments | External | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 28 | 28 | 23 | ||||||||||||||||
Veyer Division | Operating Segments | Internal | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 5,855 | 5,963 | $ 6,321 | ||||||||||||||||
Varis Division | Operating Segments | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 7 | 5 | |||||||||||||||||
Division operating income (loss) | (66) | (34) | |||||||||||||||||
Varis Division | Operating Segments | External | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | $ 7 | $ 5 | |||||||||||||||||
[1]Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year. |
Reconciliation of Measure of Di
Reconciliation of Measure of Division Operating Income to Consolidated Income (Loss) from Continuing Operations Before Income Taxes (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2022 | Sep. 24, 2022 | Jun. 25, 2022 | Mar. 26, 2022 | Dec. 25, 2021 | Sep. 25, 2021 | Jun. 26, 2021 | Mar. 27, 2021 | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Segment Reporting [Abstract] | |||||||||||
Division operating income | $ 387 | $ 393 | $ 396 | ||||||||
Asset impairments | $ (6) | $ (3) | $ (3) | $ (2) | $ (2) | $ (5) | $ (1) | $ (12) | (14) | (20) | (182) |
Merger, restructuring and other operating expenses, net | $ 3 | $ (8) | $ (23) | $ (10) | $ (14) | $ (13) | $ (11) | $ (13) | (39) | (51) | (102) |
Unallocated expenses | (91) | (88) | (106) | ||||||||
Interest income | 5 | 1 | 4 | ||||||||
Interest expense | (16) | (28) | (42) | ||||||||
Loss on extinguishment and modification of debt | (12) | ||||||||||
Other income, net | 10 | 24 | 6 | ||||||||
Income (loss) from continuing operations before income taxes | $ 242 | $ 231 | $ (38) |
Summary of Disaggregated Revenu
Summary of Disaggregated Revenue from Major Sales Categories (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2022 | [1] | Sep. 24, 2022 | [1] | Jun. 25, 2022 | [1] | Mar. 26, 2022 | [1] | Dec. 25, 2021 | [1] | Sep. 25, 2021 | [1] | Jun. 26, 2021 | [1] | Mar. 27, 2021 | [1] | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | $ 2,106 | $ 2,172 | $ 2,034 | $ 2,178 | $ 2,042 | $ 2,179 | $ 2,070 | $ 2,174 | $ 8,491 | $ 8,465 | $ 8,872 | ||||||||
Products, Supplies | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 4,144 | 3,815 | 4,006 | ||||||||||||||||
Products, Technology | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 2,461 | 2,758 | 3,014 | ||||||||||||||||
Products, Furniture and Other | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | 1,255 | 1,302 | 1,281 | ||||||||||||||||
Services, Copy and Print | |||||||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||||||
Sales | $ 631 | $ 590 | $ 571 | ||||||||||||||||
[1]Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year. |
Summary of Information about Ot
Summary of Information about Other Significant Balances by Each of the Divisions, Reconciled to Consolidated Totals (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | ||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | $ 99 | $ 73 | $ 58 | |
Depreciation and amortization | 131 | 146 | 157 | |
Assets | 4,149 | 4,865 | ||
Corporate and Discontinued Operations | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | [1] | 16 | 17 | 6 |
Depreciation and amortization | [1] | 4 | 11 | 12 |
Assets | [1] | 724 | 1,362 | |
ODP Business Solutions Division | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 5 | 5 | 8 | |
Depreciation and amortization | 21 | 24 | 21 | |
Assets | 749 | 654 | ||
Office Depot Division | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 14 | 15 | 25 | |
Depreciation and amortization | 56 | 67 | 75 | |
Assets | 1,553 | 1,728 | ||
Veyer Division | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 20 | 22 | 19 | |
Depreciation and amortization | 37 | 40 | $ 49 | |
Assets | 993 | 1,038 | ||
Varis Division | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Capital expenditures | 44 | 14 | ||
Depreciation and amortization | 13 | 4 | ||
Assets | $ 130 | $ 83 | ||
[1]Amounts included in “Corporate and Discontinued Operations” consist of (i) assets (including all cash and cash equivalents) and depreciation related to corporate activities and shared services of continuing operations, and (ii) assets of discontinued operations amounting to $469 million at December 25, 2021. |
Summary of Information about _2
Summary of Information about Other Significant Balances by Each of the Divisions, Reconciled to Consolidated Totals (Parenthetical) (Detail) $ in Millions | Dec. 25, 2021 USD ($) |
Corporate and Discontinued Operations | |
Segment Reporting Information [Line Items] | |
Assets of discontinued operations | $ 469 |
Schedule of Components of Incom
Schedule of Components of Income (Loss) from Continuing Operations before Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 226 | $ 173 | $ (30) |
Foreign | 16 | 58 | (8) |
Income (loss) from continuing operations before income taxes | $ 242 | $ 231 | $ (38) |
Schedule Income Tax Expense (Be
Schedule Income Tax Expense (Benefit) Related to Income (Loss) From Continuing Operations (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Income Tax Disclosure [Abstract] | |||
Federal, Current | $ 26 | $ 14 | $ (7) |
State, Current | (4) | 8 | 17 |
Foreign, Current | 7 | 5 | 4 |
Federal, Deferred | 27 | 13 | 19 |
State, Deferred | 10 | 2 | (5) |
Foreign, Deferred | (2) | 2 | (3) |
Income tax expense | $ 64 | $ 44 | $ 25 |
Reconciliation Of Income Taxes
Reconciliation Of Income Taxes at Federal Statutory Rate to Provision for Income Taxes (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Income Tax Disclosure [Abstract] | |||
Federal tax computed at the statutory rate | $ 51 | $ 48 | $ (8) |
State taxes, net of Federal benefit | 11 | 10 | 4 |
Foreign income taxed at rates other than Federal | 2 | (5) | 4 |
Increase (decrease) in valuation allowance | (3) | (3) | |
Non-deductible Goodwill impairments | 24 | ||
Other non-deductible expenses and settlements | 4 | 5 | 4 |
FIN 48 adjustments | (2) | ||
Non-taxable income and additional deductible expenses | (1) | (3) | (3) |
Impact of stock compensation (windfall)/shortfall | (3) | (6) | 2 |
State NOL expirations | 2 | ||
Other items, net | (2) | 1 | |
Income tax expense | $ 64 | $ 44 | $ 25 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | Dec. 28, 2019 | |
Income Taxes [Line Items] | ||||
Effective tax rate | 26% | 19% | (66.00%) | |
Effective income tax rate reconciliation, at federal statutory income tax rate, percent | 26% | 21% | ||
Unrecognized Tax Benefits | $ 10 | $ 13 | $ 13 | $ 13 |
Net uncertain tax positions, if recognized affect effective tax rate | 6 | |||
Unrecognized Tax Benefits results from positions if sustained offset by change in valuation allowance | 4 | |||
Unrecognized tax benefits, material tax positions | 2 | |||
Unrecognized tax benefits, accrued interest and penalties | 4 | |||
Compucom | ||||
Income Taxes [Line Items] | ||||
Tax effected capital loss recognized | 841 | |||
Capital loss available to be carried back | 94 | $ 94 | ||
Capital loss expected refund amount | 23 | |||
Unrealized benefit from excess capital loss | 747 | |||
Foreign | ||||
Income Taxes [Line Items] | ||||
Operating loss carry forwards | 238 | |||
Unrecognized tax benefits, period increase (decrease) | 1 | |||
State | ||||
Income Taxes [Line Items] | ||||
Operating loss carry forwards | 636,000 | |||
Unrecognized tax benefits, period increase (decrease) | $ (4) | |||
State | Minimum | ||||
Income Taxes [Line Items] | ||||
Operating loss carryforwards, expiration dates | 2024 | |||
State | Maximum | ||||
Income Taxes [Line Items] | ||||
Operating loss carryforwards, expiration dates | 2041 | |||
State | Expire in 2022 | ||||
Income Taxes [Line Items] | ||||
Operating loss carry forwards | $ 20 | |||
U.S. Federal Foreign | ||||
Income Taxes [Line Items] | ||||
Tax credit carryforwards | $ 27 | |||
U.S. Federal Foreign | Earliest Tax Year | ||||
Income Taxes [Line Items] | ||||
Tax credit carryforward, expiration year | 2023 | |||
U.S. Federal Foreign | Latest Tax Year | ||||
Income Taxes [Line Items] | ||||
Tax credit carryforward, expiration year | 2024 | |||
State and Foreign | ||||
Income Taxes [Line Items] | ||||
Tax credit carryforwards | $ 11 | |||
State and Foreign | Earliest Tax Year | ||||
Income Taxes [Line Items] | ||||
Tax credit carryforward, expiration year | 2023 | |||
State and Foreign | Latest Tax Year | ||||
Income Taxes [Line Items] | ||||
Tax credit carryforward, expiration year | 2028 | |||
State and Foreign | Indefinite Carryforward | ||||
Income Taxes [Line Items] | ||||
Tax credit carryforwards | $ 2 | |||
Deferred Income Taxes and Other Long-Term Liabilities | ||||
Income Taxes [Line Items] | ||||
Deferred income tax liabilities | $ 2 | $ 4 |
Schedule of Components of Defer
Schedule of Components of Deferred Income Tax Assets and Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Deferred Tax Assets Operating Loss Carryforwards Components [Abstract] | ||
U.S. and foreign loss carryforwards | $ 277 | $ 61 |
Operating lease right-of-use assets | 262 | 273 |
Pension and other accrued compensation | 35 | 47 |
Basis difference in subsidiary held for sale | 23 | |
Accruals for facility closings | 2 | 2 |
Inventory | 10 | 7 |
Self-insurance accruals | 13 | 14 |
Deferred revenue | 9 | 10 |
U.S. and foreign income tax credit carryforwards | 38 | 70 |
Allowance for bad debts | 4 | 5 |
Accrued expenses | 14 | 18 |
Basis difference in fixed assets | 43 | 36 |
Internally developed software | 1 | |
Gross deferred tax assets | 708 | 566 |
Valuation allowance | (266) | (93) |
Deferred tax assets | 442 | 473 |
Internal software | 2 | |
Operating lease liabilities | 244 | 251 |
Intangibles | 12 | 5 |
Undistributed foreign earnings | 5 | |
Deferred tax liabilities | 261 | 258 |
Net deferred tax assets | $ 181 | $ 215 |
Summary of Valuation Allowances
Summary of Valuation Allowances (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Income Taxes [Line Items] | |||
Beginning balance | $ 93 | ||
Ending balance | 266 | $ 93 | |
Valuation Allowance of Deferred Tax Assets | |||
Income Taxes [Line Items] | |||
Beginning balance | 93 | 99 | $ 100 |
Additions, charged to expense | 184 | 2 | |
Reductions | (11) | (6) | (3) |
Ending balance | $ 266 | $ 93 | $ 99 |
Summary of Activity Related to
Summary of Activity Related to Unrecognized Tax Benefit (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Income Tax Disclosure [Abstract] | |
Beginning balance | $ 13 |
Decrease related to prior year tax positions | (3) |
Ending balance | $ 10 |
Calculation Earnings (Loss) Per
Calculation Earnings (Loss) Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2022 | [1] | Sep. 24, 2022 | [1] | Jun. 25, 2022 | [1] | Mar. 26, 2022 | [1] | Dec. 25, 2021 | [1] | Sep. 25, 2021 | [1] | Jun. 26, 2021 | [1] | Mar. 27, 2021 | [1] | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Basic earnings (loss) per share | |||||||||||||||||||
Net income (loss) from continuing operations | $ 36 | $ 67 | $ 20 | $ 55 | $ 32 | $ 73 | $ 20 | $ 63 | $ 178 | $ 187 | $ (63) | ||||||||
Discontinued operations, net of tax | (19) | 7 | (306) | 28 | (108) | (10) | (12) | (395) | (256) | ||||||||||
Net income (loss) | $ 17 | $ 67 | $ 27 | $ 55 | $ (274) | $ 101 | $ (88) | $ 53 | $ 166 | $ (208) | $ (319) | ||||||||
Weighted-average shares outstanding | 48 | 53 | 53 | ||||||||||||||||
Continuing operations | $ 0.79 | [2] | $ 1.39 | [2] | $ 0.40 | [2] | $ 1.14 | [2] | $ 0.63 | [3] | $ 1.38 | [3] | $ 0.36 | [3] | $ 1.17 | [3] | $ 3.73 | $ 3.54 | $ (1.20) |
Discontinued operations | (0.41) | [2] | (0.01) | [2] | 0.15 | [2] | (6.07) | [3] | 0.54 | [3] | (1.98) | [3] | (0.18) | [3] | (0.25) | (7.47) | (4.85) | ||
Net basic earnings (loss) per share | $ 0.38 | [2] | $ 1.38 | [2] | $ 0.55 | [2] | $ 1.14 | [2] | $ (5.44) | [2] | $ 1.92 | [2] | $ (1.62) | [2] | $ 0.99 | [2] | $ 3.48 | $ (3.93) | $ (6.05) |
Diluted earnings (loss) per share | |||||||||||||||||||
Net income (loss) from continuing operations | $ 36 | $ 67 | $ 20 | $ 55 | $ 32 | $ 73 | $ 20 | $ 63 | $ 178 | $ 187 | $ (63) | ||||||||
Discontinued operations, net of tax | (19) | 7 | (306) | 28 | (108) | (10) | (12) | (395) | (256) | ||||||||||
Net income (loss) | $ 17 | $ 67 | $ 27 | $ 55 | $ (274) | $ 101 | $ (88) | $ 53 | $ 166 | $ (208) | $ (319) | ||||||||
Weighted-average shares outstanding | 48 | 53 | 53 | ||||||||||||||||
Stock options and restricted stock | 1 | 2 | |||||||||||||||||
Diluted weighted-average shares outstanding | 49 | 55 | 53 | ||||||||||||||||
Continuing operations | $ 0.76 | [2] | $ 1.36 | [2] | $ 0.39 | [2] | $ 1.09 | [2] | $ 0.61 | [3] | $ 1.33 | [3] | $ 0.35 | [3] | $ 1.12 | [3] | $ 3.61 | $ 3.42 | $ (1.20) |
Discontinued operations | (0.40) | [2] | (0.01) | [2] | 0.15 | [2] | (5.87) | [3] | 0.52 | [3] | (1.93) | [3] | (0.17) | [3] | (0.24) | (7.21) | (4.85) | ||
Net diluted earnings (loss) per share | $ 0.36 | [2] | $ 1.35 | [2] | $ 0.54 | [2] | $ 1.09 | [2] | $ (5.26) | [2] | $ 1.85 | [2] | $ (1.58) | [2] | $ 0.95 | [2] | $ 3.37 | $ (3.79) | $ (6.05) |
[1]Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year.[2] The sum of the quarterly earnings (loss) per share does not equal the annual earnings (loss) per share due to differences in quarterly and annual weighted-average shares outstanding. |
Earnings (Loss) Per Share - Add
Earnings (Loss) Per Share - Additional Information (Detail) - Nonvested Stock Options and Shares - shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Shares excluded from computation of diluted earnings per share | 1 | 2 | |
Maximum | |||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||
Shares excluded from computation of diluted earnings per share | 1 |
Schedule of Property and Equipm
Schedule of Property and Equipment (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 2,208 | $ 2,312 |
Less accumulated depreciation | (1,856) | (1,835) |
Total | 352 | 477 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 30 | 45 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 79 | 200 |
Computer Software | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 764 | 693 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 565 | 587 |
Furniture, fixtures and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | 753 | 775 |
Construction In Progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, Gross | $ 17 | $ 12 |
Schedule of Assets Held under F
Schedule of Assets Held under Finance Leases (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Property, Plant and Equipment [Line Items] | ||
Assets held under finance leases, Gross | $ 2,208 | $ 2,312 |
Less accumulated depreciation | (1,856) | (1,835) |
Total | 352 | 477 |
Assets Held Under Finance Leases | ||
Property, Plant and Equipment [Line Items] | ||
Assets held under finance leases, Gross | 154 | 162 |
Less accumulated depreciation | (125) | (123) |
Total | 29 | 39 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Assets held under finance leases, Gross | 79 | 200 |
Buildings | Assets Held Under Finance Leases | ||
Property, Plant and Equipment [Line Items] | ||
Assets held under finance leases, Gross | 11 | 19 |
Furniture, fixtures and equipment | ||
Property, Plant and Equipment [Line Items] | ||
Assets held under finance leases, Gross | 753 | 775 |
Furniture, fixtures and equipment | Assets Held Under Finance Leases | ||
Property, Plant and Equipment [Line Items] | ||
Assets held under finance leases, Gross | $ 143 | $ 143 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Property, Plant and Equipment [Line Items] | |||
Depreciation expense | $ 75 | $ 88 | $ 101 |
Capitalized software costs, Gross | 773 | 699 | |
Capitalized software costs, Net | 145 | 115 | |
Amortization of capitalized software costs | 47 | $ 49 | $ 50 |
Carrying Amount | |||
Property, Plant and Equipment [Line Items] | |||
Assets held for sale | $ 104 | ||
Capitalized Software | |||
Property, Plant and Equipment [Line Items] | |||
Weighted average remaining amortization period | 4 years |
Estimated Future Amortization E
Estimated Future Amortization Expense Related to Capitalized Software (Detail) $ in Millions | Dec. 31, 2022 USD ($) |
Property Plant And Equipment [Abstract] | |
2023 | $ 45 |
2024 | 38 |
2025 | 31 |
2026 | 21 |
2027 | 9 |
Thereafter | $ 1 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Other Intangible Assets [Line Items] | |||
Goodwill addition | $ 0 | ||
Percentage of fair value exceeded carrying amount of goodwill | 21% | ||
Trade Name | $ 13,000,000 | $ 13,000,000 | |
Amortization of intangible assets | 9,000,000 | 9,000,000 | $ 6,000,000 |
Impairment of definite-lived intangible assets | $ 0 | $ 0 | $ 0 |
Customer Relationships | |||
Other Intangible Assets [Line Items] | |||
Weighted average amortization period for the definite-lived intangible assets (in years) | 10 years | ||
Trade Names | |||
Other Intangible Assets [Line Items] | |||
Impairment of indefinite-lived intangible assets | $ 0 |
Schedule of Goodwill by Segment
Schedule of Goodwill by Segment (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Goodwill [Line Items] | |
Balance as of December 25, 2021 | $ 464 |
Balance as of December 31, 2022 | 464 |
Operating Segments | |
Goodwill [Line Items] | |
Balance as of December 25, 2021 | 464 |
Balance as of December 31, 2022 | 464 |
Business Solutions Division | Operating Segments | |
Goodwill [Line Items] | |
Balance as of December 25, 2021 | 318 |
Allocation to New segment | (318) |
Retail Division | Operating Segments | |
Goodwill [Line Items] | |
Balance as of December 25, 2021 | 78 |
Allocation to New segment | (78) |
ODP Business Solutions Division | Operating Segments | |
Goodwill [Line Items] | |
Allocation to New segment | 142 |
Balance as of December 31, 2022 | 142 |
Office Depot Division | Operating Segments | |
Goodwill [Line Items] | |
Allocation to New segment | 219 |
Balance as of December 31, 2022 | 219 |
Veyer Division | Operating Segments | |
Goodwill [Line Items] | |
Allocation to New segment | 35 |
Balance as of December 31, 2022 | 35 |
Varis Division | Operating Segments | |
Goodwill [Line Items] | |
Balance as of December 25, 2021 | 68 |
Balance as of December 31, 2022 | $ 68 |
Definite Lived Intangible Asset
Definite Lived Intangible Assets Included in Other Intangible Assets Net (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 128 | $ 128 |
Accumulated Amortization | (95) | (86) |
Net Carrying Amount | 33 | 42 |
Customer Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 122 | 122 |
Accumulated Amortization | (90) | (84) |
Net Carrying Amount | 32 | 38 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 6 | 6 |
Accumulated Amortization | (5) | (2) |
Net Carrying Amount | $ 1 | $ 4 |
Estimated Future Amortization_2
Estimated Future Amortization Expense for Intangible Assets (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
2023 | $ 5 | |
2024 | 3 | |
2025 | 3 | |
2026 | 3 | |
2027 | 3 | |
Thereafter | 16 | |
Net Carrying Amount | $ 33 | $ 42 |
Schedule of Debt (Detail)
Schedule of Debt (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 | |
Debt Instrument [Line Items] | |||
Finance lease obligations | $ 14 | [1] | $ 17 |
Other current maturities of long-term debt | 2 | 3 | |
Total | 16 | 20 | |
Finance lease obligations | 24 | [1] | 35 |
Other financing obligations | 1 | 3 | |
Total | 172 | 228 | |
Revenue bonds, due in varying amounts periodically through 2029 | |||
Debt Instrument [Line Items] | |||
Long term debt | 75 | 75 | |
Third Amended and Restated Credit Agreement | |||
Debt Instrument [Line Items] | |||
New Facilities loans under the Third Amended Credit Agreement, due 2025 | 57 | 100 | |
American & Foreign Power Company, Inc. 5% debentures, due 2030 | |||
Debt Instrument [Line Items] | |||
Long term debt | $ 15 | $ 15 | |
[1]Finance lease payments include $1 |
Schedule of Debt (Parenthetical
Schedule of Debt (Parenthetical) (Detail) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 25, 2021 | |
Third Amended and Restated Credit Agreement | ||
Debt Instrument [Line Items] | ||
Long term debt, due date | 2025 | 2025 |
Revenue bonds, due in varying amounts periodically through 2029 | ||
Debt Instrument [Line Items] | ||
Long term debt, due date | 2029 | 2029 |
American & Foreign Power Company, Inc. 5% debentures, due 2030 | ||
Debt Instrument [Line Items] | ||
Long term debt, due date | 2030 | 2030 |
Long term debt, interest rate | 5% | 5% |
Debt - Additional Information (
Debt - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | |||
Apr. 17, 2020 USD ($) Sub-facility | Mar. 26, 2022 USD ($) | Dec. 31, 2022 USD ($) | Dec. 25, 2021 | Dec. 26, 2020 USD ($) | |
Global Availability | |||||
Debt Instrument [Line Items] | |||||
Minimum availability level of borrowings to avoid cash settlement percentage | 12.50% | ||||
Revenue bonds, due in varying amounts periodically through 2029 | |||||
Debt Instrument [Line Items] | |||||
Senior secured notes, due date | 2029 | 2029 | |||
American & Foreign Power Company, Inc. 5% debentures, due 2030 | |||||
Debt Instrument [Line Items] | |||||
Senior secured notes, due date | 2030 | 2030 | |||
Long-term debt, interest rate | 5% | 5% | |||
Third Amended and Restated Credit Agreement | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 1,300,000,000 | ||||
Maturity date of debt | Apr. 17, 2025 | Apr. 17, 2025 | |||
Minimum availability level of borrowings to avoid fixed charge coverage ratio test percentage | 10% | ||||
Excess of debt default amount resulting termination of Facility | $ 25,000,000 | ||||
Excess acquisition of ownership percentage resulting termination of Facility | 40% | ||||
Debt issuance costs | $ 6,000,000 | ||||
Available credit under the facility | $ 856,000,000 | ||||
Third Amended and Restated Credit Agreement | Federal Funds Rate Plus | |||||
Debt Instrument [Line Items] | |||||
Long-term debt, basis spread on variable rate | 0.50% | ||||
Third Amended and Restated Credit Agreement | LIBOR | |||||
Debt Instrument [Line Items] | |||||
Long-term debt, basis spread on variable rate | 1% | ||||
Third Amended and Restated Credit Agreement | Asset-based Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 1,200,000,000 | ||||
Credit agreement, increased borrowing capacity | $ 250,000,000 | ||||
Number of revolving loan sub-facilities | Sub-facility | 2 | ||||
Retirement of term loan facility | $ 43,000,000 | ||||
Revolving loans outstanding | $ 0 | ||||
Third Amended and Restated Credit Agreement | Asset-based Revolving Credit Facility | Minimum | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, increase (decrease), net | 200,000,000 | ||||
Third Amended and Restated Credit Agreement | Asset-based Revolving Credit Facility | Maximum | |||||
Debt Instrument [Line Items] | |||||
Line of credit facility, increase (decrease), net | $ 1,000,000,000 | ||||
Third Amended and Restated Credit Agreement | Asset-based First-in, Last-out Term Loan Facility | |||||
Debt Instrument [Line Items] | |||||
Maximum borrowing capacity under credit facility | $ 100,000,000 | ||||
Borrowing under credit facility | 57,000,000 | ||||
Third Amended and Restated Credit Agreement | Revolving Loan Sub-facility One | |||||
Debt Instrument [Line Items] | |||||
Borrowing under credit facility | 1,150,000,000 | ||||
Third Amended and Restated Credit Agreement | Revolving Loan Sub-facility One | Letter Of Credit Sub Facility | |||||
Debt Instrument [Line Items] | |||||
Borrowing under credit facility | 400,000,000 | ||||
Third Amended and Restated Credit Agreement | Revolving Loan Sub-facility One | Swing Line Loan Facility | |||||
Debt Instrument [Line Items] | |||||
Borrowing under credit facility | 115,000,000 | ||||
Third Amended and Restated Credit Agreement | Revolving Loan Sub-facility Two | |||||
Debt Instrument [Line Items] | |||||
Borrowing under credit facility | 50,000,000 | ||||
Third Amended and Restated Credit Agreement | Revolving Loan Sub-facility Two | Letter Of Credit Sub Facility | |||||
Debt Instrument [Line Items] | |||||
Borrowing under credit facility | 25,000,000 | ||||
Third Amended and Restated Credit Agreement | Revolving Loan Sub-facility Two | Swing Line Loan Facility | |||||
Debt Instrument [Line Items] | |||||
Borrowing under credit facility | $ 5,000,000 | ||||
Third Amended and Restated Credit Agreement | Standby Letter of Credit | |||||
Debt Instrument [Line Items] | |||||
Borrowing under credit facility | $ 41,000,000 |
Schedule of Maturities of Recou
Schedule of Maturities of Recourse Debt, Finance Lease and Other Financing Obligations (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 | |
Debt Disclosure [Abstract] | |||
2023 | $ 18 | ||
2024 | 10 | ||
2025 | 64 | ||
2026 | 36 | ||
2027 | 33 | ||
Thereafter | 30 | ||
Total | 191 | ||
Less interest on finance leases | [1] | (3) | |
Total | 188 | ||
Less: Current portion | (16) | ||
Total | $ 172 | $ 228 | |
[1]Finance lease payments include $1 |
Components of Lease Expense (De
Components of Lease Expense (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Finance lease cost: | |||
Amortization of right-of-use assets | $ 14 | $ 18 | $ 18 |
Interest on lease liabilities | 2 | 3 | 4 |
Operating lease cost | 334 | 350 | 402 |
Short-term lease cost | 6 | 4 | 6 |
Variable lease cost | 94 | 99 | 112 |
Sublease income | (2) | (2) | (2) |
Total lease cost | $ 448 | $ 472 | $ 540 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information Related to Leases (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Leases [Abstract] | |||
Operating cash flows from finance leases | $ 2 | $ 3 | $ 4 |
Operating cash flows from operating leases | 370 | 408 | 447 |
Financing cash flows from finance leases | 18 | 22 | 20 |
Right-of-use assets obtained in exchange for new finance lease liabilities | 4 | 3 | 29 |
Right-of-use assets obtained in exchange for new operating lease liabilities | $ 228 | $ 127 | $ 117 |
Supplemental Balance Sheets Inf
Supplemental Balance Sheets Information Related to Leases (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 | |
Leases [Abstract] | |||
Finance lease right-of-use assets | $ 29 | $ 39 | |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Property and equipment, net | Property and equipment, net | |
Operating lease right-of-use assets | $ 874 | $ 936 | |
Operating Leases liability, Current | $ 281 | [1] | $ 304 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities | [1] | Accrued expenses and other current liabilities |
Finance Leases, Current | $ 14 | [2] | $ 17 |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Short-term borrowings and current maturities of long-term debt | [2] | Short-term borrowings and current maturities of long-term debt |
Finance Leases, Non-current | $ 24 | [2] | $ 35 |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Long-term debt, net of current maturities | [2] | Long-term debt, net of current maturities |
Operating lease liabilities | $ 693 | [1] | $ 753 |
Weighted-average remaining lease term – finance leases | 3 years | 4 years | |
Weighted-average remaining lease term – operating leases | 5 years | 5 years | |
Weighted-average discount rate – finance leases | 4.90% | 5% | |
Weighted-average discount rate – operating leases | 6.10% | 5.80% | |
[1]Operating lease payments include $47 million related to options to extend lease terms that are reasonably certain of being exercised.[2]Finance lease payments include $1 |
Schedule of Maturities of Lease
Schedule of Maturities of Lease Liabilities Under Operating and Finance Leases (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 | ||
Leases [Abstract] | ||||
Operating leases, 2023 | [1] | $ 333 | ||
Operating leases, 2024 | [1] | 251 | ||
Operating leases, 2025 | [1] | 182 | ||
Operating leases, 2026 | [1] | 142 | ||
Operating leases, 2027 | [1] | 96 | ||
Operating leases, Thereafter | [1] | 125 | ||
Operating leases, Total minimum payments | [1] | 1,129 | ||
Operating Leases, Less imputed interest | [1] | (155) | ||
Operating Leases, Total | [1] | 974 | ||
Operating Leases, Current | $ 281 | [1] | $ 304 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses and other current liabilities | [1] | Accrued expenses and other current liabilities | |
Operating lease liabilities | $ 693 | [1] | $ 753 | |
Finance Leases, 2023 | [2] | 15 | ||
Finance Leases, 2024 | [2] | 10 | ||
Finance Leases, 2025 | [2] | 7 | ||
Finance Leases, 2026 | [2] | 5 | ||
Finance Leases, 2027 | [2] | 3 | ||
Finance Leases, Thereafter | [2] | 1 | ||
Finance leases, Total minimum payments | [2] | 41 | ||
Finance Leases, Less imputed interest | [2] | (3) | ||
Finance Leases, Total | [2] | 38 | ||
Finance Leases, Current | $ 14 | [2] | $ 17 | |
Finance Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Short-term borrowings and current maturities of long-term debt | [2] | Short-term borrowings and current maturities of long-term debt | |
Finance Leases, Non-current | $ 24 | [2] | $ 35 | |
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Long-term debt, net of current maturities | [2] | Long-term debt, net of current maturities | |
[1]Operating lease payments include $47 million related to options to extend lease terms that are reasonably certain of being exercised.[2]Finance lease payments include $1 |
Schedule of Maturities of Lea_2
Schedule of Maturities of Lease Liabilities Under Operating and Finance Leases (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Leases [Line Items] | |||
Operating lease payments | $ 370 | $ 408 | $ 447 |
Finance lease payments | 18 | $ 22 | $ 20 |
Finance leases not yet commenced minimum lease payments | 5 | ||
Options to Extend Lease Terms | |||
Leases [Line Items] | |||
Operating lease payments | 47 | ||
Finance lease payments | $ 1 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||
Nov. 16, 2021 | Oct. 31, 2022 | Jul. 31, 2022 | Feb. 22, 2023 | Dec. 31, 2022 | Sep. 24, 2022 | Jun. 25, 2022 | Sep. 24, 2022 | Dec. 31, 2022 | Dec. 26, 2020 | Dec. 31, 2021 | Dec. 25, 2021 | May 31, 2021 | |
Shareholders Equity [Line Items] | |||||||||||||
Stock repurchase program, authorized amount | $ 650,000,000 | ||||||||||||
Stock repurchase program, additional authorized amount | $ 200,000,000 | ||||||||||||
Stock repurchase program, average price per share | $ 41.21 | ||||||||||||
Stock repurchase program, shares purchased at cost | $ 266,000,000 | $ 30,000,000 | |||||||||||
Treasury stock, shares | 23,422,969 | 23,422,969 | 16,249,028 | ||||||||||
Subsequent Event | |||||||||||||
Shareholders Equity [Line Items] | |||||||||||||
Stock repurchase program, shares purchased | 2,000,000 | ||||||||||||
Stock repurchase program, shares purchased at cost | $ 100,000,000 | ||||||||||||
Maximum | |||||||||||||
Shareholders Equity [Line Items] | |||||||||||||
Stock repurchase program, authorized amount | $ 300,000,000 | ||||||||||||
Accelerated Share Repurchase Agreement | |||||||||||||
Shareholders Equity [Line Items] | |||||||||||||
Stock repurchase program, expiration date | Jun. 30, 2022 | ||||||||||||
Up-front payment in exchange for common stock in repurchase shares | $ 150,000,000 | ||||||||||||
Common stock shares received from share repurchase agreement | 700,000 | ||||||||||||
Stock repurchase program, shares purchased | 3,600,000 | ||||||||||||
Stock repurchase program, average price per share | $ 41.46 | ||||||||||||
Dutch Auction Tender Offer | |||||||||||||
Shareholders Equity [Line Items] | |||||||||||||
Stock repurchase program, authorized amount | $ 600,000,000 | ||||||||||||
Stock repurchase program, expiration date | Dec. 31, 2025 | Jun. 30, 2024 | Aug. 12, 2022 | ||||||||||
Stock repurchase program, shares purchased | 14,000 | 6,000,000 | 6,000,000 | 7,000,000 | |||||||||
Stock repurchase program, commencement date | Jul. 18, 2022 | ||||||||||||
Stock repurchase program, shares purchased at cost | $ 1,000,000 | $ 266,000,000 | $ 266,000,000 | $ 295,000,000 | |||||||||
Stock repurchase program, remaining authorized repurchase amount | $ 847,000,000 | $ 847,000,000 | |||||||||||
Dutch Auction Tender Offer | Maximum | |||||||||||||
Shareholders Equity [Line Items] | |||||||||||||
Stock repurchase program, authorized amount | $ 1,000,000,000 | $ 600,000,000 | |||||||||||
Preferred Stock | |||||||||||||
Shareholders Equity [Line Items] | |||||||||||||
Preferred stock, shares authorized | 1,000,000 | 1,000,000 | 1,000,000 | ||||||||||
Redeemable preferred stock, par value per share | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||
Preferred stock, shares issued | 0 | 0 | 0 | ||||||||||
Preferred stock, shares outstanding | 0 | 0 | 0 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss Activity, Net of Tax (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | $ 1,438 | $ 1,880 | $ 2,173 |
Total other comprehensive income, net of tax, where applicable | (71) | 26 | 34 |
Balance | 1,287 | 1,438 | 1,880 |
Foreign Currency Translation Adjustments | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (27) | (27) | |
Other comprehensive income activity before reclassifications | (18) | ||
Reclassification of foreign currency translation adjustments realized upon disposal of business | 6 | ||
Total other comprehensive income, net of tax, where applicable | (12) | ||
Balance | (39) | (27) | (27) |
Change in Deferred Pension | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | 21 | (5) | |
Other comprehensive income activity | 32 | ||
Other comprehensive income activity before reclassifications | (62) | ||
Tax impact | 3 | (6) | |
Total other comprehensive income, net of tax, where applicable | (59) | 26 | |
Balance | (38) | 21 | (5) |
Accumulated Other Comprehensive Loss | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Balance | (6) | (32) | (66) |
Other comprehensive income activity | 32 | ||
Other comprehensive income activity before reclassifications | (80) | ||
Reclassification of foreign currency translation adjustments realized upon disposal of business | 6 | ||
Tax impact | 3 | (6) | |
Total other comprehensive income, net of tax, where applicable | (71) | 26 | 34 |
Balance | $ (77) | $ (6) | $ (32) |
Stock-Based Compensation - Addi
Stock-Based Compensation - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | Dec. 28, 2019 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Total compensation expense for share-based awards | $ 40 | $ 38 | $ 41 | ||||
Total recognized tax benefit | $ 11 | $ 14 | $ 3 | ||||
Performance Based Stock Incentive Program | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted in period | 421,038 | 1,298,868 | 932,344 | ||||
Award vesting period | 3 years | ||||||
Stock-based compensation expense not yet recognized relating to non-vested awards | $ 18.6 | ||||||
Stock-based compensation expense relating to non-vested awards, weighted-average recognition period, years | 1 year 8 months 12 days | ||||||
Shares outstanding, Number | 1,457,725 | [1] | 2,175,831 | [1] | 2,458,978 | [1] | 1,994,111 |
Estimated number of shares expected to vest | 1,400,000 | ||||||
Fair value of shares vested | $ 36.1 | ||||||
Restricted Stock and Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted in period | 933,487 | 521,512 | 835,828 | ||||
Shares outstanding, Number | 1,530,962 | 1,386,778 | 1,526,653 | 1,394,756 | |||
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Award vesting period | 3 years | ||||||
Stock-based compensation expense not yet recognized relating to non-vested awards | $ 34.6 | ||||||
Stock-based compensation expense relating to non-vested awards, weighted-average recognition period, years | 2 years | ||||||
Fair value of shares vested | $ 24.2 | ||||||
Director | Restricted Stock and Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares granted in period | 25,000 | ||||||
Shares outstanding, Number | 200,000 | ||||||
Employees | Restricted Stock and Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares outstanding, Number | 1,300,000 | ||||||
Estimated number of shares expected to vest | 1,300,000 | ||||||
[1] Outstanding shares at the end of 2022 include 5 million shares of awards granted in 2020 that will be settled in cash in 2023. These awards are remeasured to fair value at each reporting period. The remeasurement impact was not material in 2022, 2021, and 2020. |
Summary of Status of Nonvested
Summary of Status of Nonvested Shares (Detail) - Restricted Stock and Restricted Stock Units - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Outstanding at beginning of the period, Shares | 1,386,778 | 1,526,653 | 1,394,756 |
Granted, Shares | 933,487 | 521,512 | 835,828 |
Vested, Shares | (585,563) | (593,249) | (579,584) |
Forfeited, Shares | (203,740) | (68,138) | (124,347) |
Outstanding at end of the period, Shares | 1,530,962 | 1,386,778 | 1,526,653 |
Outstanding at beginning of the period, Weighted Average Grant-Date Price | $ 30.48 | $ 24.71 | $ 30.40 |
Granted, Weighted Average Grant-Date Price | 42.81 | 39.55 | 19.92 |
Vested, Weighted Average Grant-Date Price | 29.65 | 23.72 | 30.71 |
Forfeited, Weighted Average Grant-Date Price | 36.29 | 29.20 | 28.60 |
Outstanding at end of the period, Weighted Average Grant-Date Price | $ 37.54 | $ 30.48 | $ 24.71 |
Summary of the Activity in the
Summary of the Activity in the Performance-Based Long-Term Incentive Program Since Inception (Detail) - Performance Based Stock Incentive Program - $ / shares | 12 Months Ended | |||||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Outstanding at beginning of the period, Shares | 2,175,831 | [1] | 2,458,978 | [1] | 1,994,111 | |
Granted, Shares | 421,038 | 1,298,868 | 932,344 | |||
Vested, Shares | (796,019) | (1,374,442) | (151,905) | |||
Forfeited, Shares | (343,125) | (207,573) | (315,572) | |||
Outstanding at end of the period, Shares | [1] | 1,457,725 | 2,175,831 | 2,458,978 | ||
Outstanding at beginning of the period, Weighted Average Grant-Date Price | $ 29.33 | [1] | $ 24.22 | [1] | $ 29.05 | |
Granted, Weighted Average Grant-Date Price | 45.01 | 41.44 | 19.42 | |||
Vested, Weighted Average Grant-Date Price | 29.71 | 23.47 | 41.80 | |||
Forfeited, Weighted Average Grant-Date Price | 30.21 | 28.71 | 27.10 | |||
Outstanding at end of the period, Weighted Average Grant-Date Price | [1] | $ 31.84 | $ 29.33 | $ 24.22 | ||
[1] Outstanding shares at the end of 2022 include 5 million shares of awards granted in 2020 that will be settled in cash in 2023. These awards are remeasured to fair value at each reporting period. The remeasurement impact was not material in 2022, 2021, and 2020. |
Summary of the Activity in th_2
Summary of the Activity in the Performance-Based Long-Term Incentive Program Since Inception (Parenthetical) (Detail) shares in Millions | Dec. 26, 2020 shares |
Performance Based Stock Incentive Program | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding shares of awards granted that will be settled in cash | 5 |
Changes in Pension and Other Po
Changes in Pension and Other Postretirement Benefit Obligations, Plan Assets and Funded Status (Detail) - North America - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Obligation at beginning of period | $ 830 | $ 924 | |
Interest cost | 21 | 20 | $ 28 |
Assumption changes | (144) | (28) | |
Actuarial gain | (9) | (12) | |
Benefits paid | (71) | (74) | |
Obligation at end of period | 627 | 830 | 924 |
Fair value of plan assets at beginning of period | 836 | 894 | |
Actual return on plan assets | (142) | 14 | |
Employer contribution | 2 | 2 | |
Benefits paid | (71) | (74) | |
Fair value of plan assets at end of period | 625 | 836 | 894 |
Net asset (liability) recognized at end of period | (2) | 6 | |
Other Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Obligation at beginning of period | 13 | 14 | |
Assumption changes | (3) | ||
Benefits paid | (1) | (1) | |
Obligation at end of period | 9 | 13 | $ 14 |
Employer contribution | 1 | 1 | |
Benefits paid | (1) | (1) | |
Net asset (liability) recognized at end of period | $ (9) | $ (13) |
Amounts Recognized in Consolida
Amounts Recognized in Consolidated Balance Sheets Related to Defined Benefit Pension and Other Postretirement Benefit Plans (Detail) - North America - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Pension Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Noncurrent assets | $ 7 | $ 18 |
Current liabilities | (1) | (2) |
Noncurrent liabilities | (8) | (10) |
Net amount recognized | (2) | 6 |
Other Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Current liabilities | (1) | (1) |
Noncurrent liabilities | (8) | (12) |
Net amount recognized | $ (9) | $ (13) |
Schedule of Defined Benefit Pen
Schedule of Defined Benefit Pension and Other Postretirement Benefit Plans with Projected Benefit Obligation and a And Accumulated Benefit Obligation In Excess of Plan Assets (Detail) - North America - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Pension Benefits | ||
Accumulated benefit obligation in excess of plan assets | ||
Accumulated benefit obligation at end of period | $ (9) | $ (11) |
Projected benefit obligation in excess of plan assets | ||
Benefit obligation at end of period | (9) | (11) |
Other Benefits | ||
Accumulated benefit obligation in excess of plan assets | ||
Accumulated benefit obligation at end of period | $ (9) | $ (13) |
Components of Net Periodic Pens
Components of Net Periodic Pension Benefit (Detail) - Pension Benefits - North America - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | $ 21 | $ 20 | $ 28 |
Expected return on plan assets | (26) | (29) | (32) |
Net periodic benefit | $ (5) | $ (9) | $ (4) |
Other Changes In Plan Assets an
Other Changes In Plan Assets and Benefit Obligations Recognized In Other Comprehensive Loss (Income) (Detail) - North America - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Accumulated other comprehensive loss (income) at beginning of year | $ (46) | $ (21) | $ 9 |
Net loss (gain) | 15 | (25) | (30) |
Accumulated other comprehensive loss (income) at end of year | (31) | (46) | (21) |
Other Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Accumulated other comprehensive loss (income) at beginning of year | 1 | ||
Net loss (gain) | (2) | $ (1) | 1 |
Accumulated other comprehensive loss (income) at end of year | $ (2) | $ 1 |
Weighted Average Assumptions Us
Weighted Average Assumptions Used in the Measurement of Benefit Obligations (Detail) | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 5.37% | 2.69% | 2.27% |
Other Benefits | United States | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 4.90% | 2.40% | 1.90% |
Other Benefits | Canada | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 5.10% | 2.90% | 2.50% |
Weighted Average Assumptions _2
Weighted Average Assumptions Used in the Measurement of Net Periodic Benefit Cost (Detail) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 2.69% | 2.27% | 3.26% |
Expected long-term rate of return on plan assets | 3.64% | 4.31% | 5.16% |
Other Benefits | UNITED STATES | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 2.40% | 1.90% | 2.80% |
Other Benefits | Canada | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate | 2.90% | 2.50% | 3.10% |
Employee Benefit Plans - Additi
Employee Benefit Plans - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Retirement Savings Plans | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Compensation expense relating to retirement savings plans | $ 17 | $ 16 | $ 17 |
Increase (Decrease) in Mortality Table | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Increase (decrease) in pension obligations | 3 | ||
Increase (Decrease) in Mortality Table | Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Increase (decrease) in other postretirement plan obligations | 1 | ||
Actuarial Gains | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Increase (decrease) in pension obligations | $ 9 | ||
Actuarial Gains | Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Increase (decrease) in pension obligations | $ (12) | ||
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return on plan assets | 3.64% | 4.31% | 5.16% |
North America | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return on plan assets | 5.17% | ||
North America | Equity Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset target allocation | 10% | ||
North America | Fixed Income Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset target allocation | 90% | ||
North America | Change in Discount Rate Assumptions | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Increase (decrease) in pension obligations | $ (144) | $ (31) | |
Increase (decrease) in other postretirement plan obligations | $ (3) | ||
North America | Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Pension contributions, current period | 2 | ||
Pension contributions, for 2022 | $ 2 | ||
United Kingdom | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term return on plan assets | 3.47% | 2.03% | 1.64% |
Plan asset target allocation | 100% | 100% | |
Deferred (loss) gain included in accumulated other comprehensive income | $ (25) | $ 24 | |
Percentage of allowance expense on assets | 0.17% | ||
United Kingdom | United Kingdom Government Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Incremental return on UK government securities | 2.71% | ||
United Kingdom | Equity Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset target allocation | 5% | 14% | |
United Kingdom | Fixed Income Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Plan asset target allocation | 95% | 84% |
Assumed Healthcare Cost Trend R
Assumed Healthcare Cost Trend Rates (Detail) - North America | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Weighted average assumptions as of year-end: | |||
Healthcare cost trend rate assumed for next year | 6.10% | 6.20% | 6.10% |
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) | 4% | 4% | 4.50% |
Year that the rate reaches the ultimate trend rate | 2041 | 2041 | 2029 |
Allocation of Pension Plan Asse
Allocation of Pension Plan Assets by Category (Detail) | Dec. 31, 2022 | Dec. 25, 2021 |
Defined Benefit Plan Disclosure [Line Items] | ||
Percentage of Plan Assets | 100% | 100% |
Cash | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Percentage of Plan Assets | 1% | 1% |
Common Collective Trust Funds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Percentage of Plan Assets | 99% | 99% |
Fair Value of Pension Plan Asse
Fair Value of Pension Plan Assets (Detail) - Pension Benefits - North America - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 |
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | $ 625 | $ 836 | $ 894 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 620 | 830 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 5 | 6 | |
U.S. Small And Mid-Cap Equity Securities | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 5 | 7 | |
U.S. Large Cap Equity Securities | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 20 | 29 | |
International Equity Securities | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 31 | 42 | |
Corporate Bonds | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 281 | 485 | |
Government Securities | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 254 | 245 | |
Other Fixed Income | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 4 | ||
Cash | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 5 | 6 | |
Cash | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 29 | 18 | |
Cash | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | 5 | 6 | |
Common Collective Trust Funds | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Plan Assets Category [Line Items] | |||
Fair value of plan assets | $ 620 | $ 830 |
Estimated Future Benefit Paymen
Estimated Future Benefit Payments (Detail) - North America $ in Millions | Dec. 31, 2022 USD ($) |
Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2023 | $ 70 |
2024 | 67 |
2025 | 64 |
2026 | 61 |
2027 | 59 |
Next five years | 247 |
Other Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2023 | 1 |
2024 | 1 |
2025 | 1 |
2026 | 1 |
2027 | 1 |
Next five years | $ 3 |
Schedule Of Reconciliation Of C
Schedule Of Reconciliation Of Changes In Projected Benefit Obligation, Fair Value Of Plan Assets And Funded Status Of Plan (Detail) - United Kingdom - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Obligation at beginning of period | $ 257 | $ 269 | |
Interest cost | 4 | 4 | $ 5 |
Plan settlements | (7) | ||
Benefits paid | (8) | (5) | |
Actuarial (gain) loss | (89) | (1) | |
Currency translation | (23) | (3) | |
Obligation at end of period | 141 | 257 | 269 |
Fair value of plan assets at beginning of period | 358 | 360 | |
Actual return on plan assets | (130) | 12 | |
Company contributions | 1 | 2 | |
Benefits paid | (8) | (4) | |
Currency translation | (32) | (5) | |
Fair value of plan assets at end of period | 189 | 358 | $ 360 |
Net amount recognized | $ 48 | $ 101 |
Components of Net Periodic Pe_2
Components of Net Periodic Pension (Benefit) Cost (Detail) - United Kingdom - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Interest cost | $ 4 | $ 4 | $ 5 |
Expected return on plan assets | (6) | (6) | $ (5) |
Settlement gain | (1) | ||
Net periodic benefit | $ (2) | $ (3) |
Assumptions Used in Calculating
Assumptions Used in Calculating Funded Status (Detail) - United Kingdom | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Expected long-term rate of return on plan assets | 3.47% | 2.03% | 1.64% |
Discount rate | 5% | 1.80% | 1.40% |
Inflation | 3% | 3.20% | 2.70% |
Allocation of Plan Assets (Deta
Allocation of Plan Assets (Detail) - United Kingdom | Dec. 31, 2022 | Dec. 25, 2021 |
Defined Benefit Plan Disclosure [Line Items] | ||
Percentage of Plan Assets | 100% | 100% |
Cash | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Percentage of Plan Assets | 2% | |
Equity Securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Percentage of Plan Assets | 5% | 14% |
Fixed Income Securities | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Percentage of Plan Assets | 95% | 84% |
Fair Value of Plan Assets (Deta
Fair Value of Plan Assets (Detail) - UNITED KINGDOM - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 |
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 189 | $ 358 | $ 360 |
Cash | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 1 | 9 | |
Developed Markets Equity Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 13 | ||
Emerging Markets Equity Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 4 | ||
Mutual Funds Real Estate | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2 | ||
Mutual Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 9 | 30 | |
Equity Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 9 | 49 | |
UK Debt Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 86 | 154 | |
Liability Term Matching Debt Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 76 | 115 | |
Emerging Markets Debt Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2 | ||
High Yield Debt | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 17 | 29 | |
Defined Benefit Plan, Debt Security | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 179 | 300 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 1 | 26 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Cash | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 1 | 9 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Developed Markets Equity Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 13 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Emerging Markets Equity Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 4 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 17 | ||
Significant Observable Inputs (Level 2) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 188 | 330 | |
Significant Observable Inputs (Level 2) | Mutual Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 9 | 30 | |
Significant Observable Inputs (Level 2) | Equity Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 9 | 30 | |
Significant Observable Inputs (Level 2) | UK Debt Funds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 86 | 154 | |
Significant Observable Inputs (Level 2) | Liability Term Matching Debt Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 76 | 115 | |
Significant Observable Inputs (Level 2) | Emerging Markets Debt Fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2 | ||
Significant Observable Inputs (Level 2) | High Yield Debt | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 17 | 29 | |
Significant Observable Inputs (Level 2) | Defined Benefit Plan, Debt Security | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 179 | 300 | |
Significant Unobservable Inputs (Level 3) | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2 | ||
Significant Unobservable Inputs (Level 3) | Mutual Funds Real Estate | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2 | ||
Significant Unobservable Inputs (Level 3) | Equity Securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 2 |
Reconciliation of the Change in
Reconciliation of the Change in Fair Value of the Pension Plan Assets Calculated based on Level 3 Inputs (Detail) - Significant Unobservable Inputs (Level 3) - United Kingdom $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Schedule of Pension Plan Assets by Fair Value [Line Items] | |
Balance at December 25, 2021 | $ 2 |
Net sales | $ (2) |
Anticipated Benefit Payments (D
Anticipated Benefit Payments (Detail) - United Kingdom $ in Millions | Dec. 31, 2022 USD ($) |
Defined Benefit Plan Disclosure [Line Items] | |
2023 | $ 9 |
2024 | 9 |
2025 | 9 |
2026 | 9 |
2027 | 10 |
Next five years | $ 52 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2022 | Sep. 24, 2022 | Jun. 25, 2022 | Mar. 26, 2022 | Dec. 25, 2021 | Sep. 25, 2021 | Jun. 26, 2021 | Mar. 27, 2021 | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||
Asset impairment charges | $ 6,000,000 | $ 3,000,000 | $ 3,000,000 | $ 2,000,000 | $ 2,000,000 | $ 5,000,000 | $ 1,000,000 | $ 12,000,000 | $ 14,000,000 | $ 20,000,000 | $ 182,000,000 |
Impairment of operating lease ROU assets | $ 12,000,000 | $ 16,000,000 | 48,000,000 | ||||||||
Impairment of goodwill and other intangible assets | 115,000,000 | ||||||||||
Impairment of fixed assets | $ 12,000,000 | ||||||||||
Retail Stores | Significant Observable Inputs (Level 2) | |||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||
Percentage used for analysis | 8% | ||||||||||
Retail Stores | Significant Observable Inputs (Level 2) | A 100 basis point decrease in anticipated sales | |||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||
Decrease in sales for scenario | 1% | ||||||||||
Decrease in gross margin for scenario | 0.50% | ||||||||||
Retail Stores | Significant Observable Inputs (Level 2) | 50 basis point decrease in anticipated gross margins | |||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||
Decrease in sales for scenario | 1% | ||||||||||
Maximum | Retail Stores | Significant Observable Inputs (Level 2) | A 100 basis point decrease in anticipated sales | Additional impairment charges | |||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||
Asset impairment charges | $ 1,000,000 | ||||||||||
Maximum | Retail Stores | Significant Observable Inputs (Level 2) | 50 basis point decrease in anticipated gross margins | Additional impairment charges | |||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||||||||||
Asset impairment charges | $ 1,000,000 |
Schedule of Fair Value of Asset
Schedule of Fair Value of Assets and Liabilities (Detail) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 25, 2021 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Company-owned life insurance | $ 138 | $ 137 |
Long-Term Debt | New Facilities loans Under Third Amended Credit Agreement due 2025 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 57 | 100 |
Revenue bonds, due in varying amounts periodically through 2029 | Long-Term Debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 76 | 76 |
American & Foreign Power Company, Inc. 5% debentures, due 2030 | Long-Term Debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 14 | 16 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Company-owned life insurance | 138 | 137 |
Carrying Amount | Long-Term Debt | New Facilities loans Under Third Amended Credit Agreement due 2025 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 57 | 100 |
Carrying Amount | Revenue bonds, due in varying amounts periodically through 2029 | Long-Term Debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | 75 | 75 |
Carrying Amount | American & Foreign Power Company, Inc. 5% debentures, due 2030 | Long-Term Debt | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, fair value | $ 15 | $ 15 |
Schedule of Fair Value of Ass_2
Schedule of Fair Value of Assets and Liabilities (Parenthetical) (Detail) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 25, 2021 | |
American & Foreign Power Company, Inc. 5% debentures, due 2030 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long term debt, interest rate | 5% | 5% |
Carrying Amount | Long-Term Debt | New Facilities loans Under Third Amended Credit Agreement due 2025 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, due date | 2025 | 2025 |
Carrying Amount | Long-Term Debt | Revenue bonds, due in varying amounts periodically through 2029 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, due date | 2029 | 2029 |
Carrying Amount | Long-Term Debt | American & Foreign Power Company, Inc. 5% debentures, due 2030 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, due date | 2030 | 2030 |
Long term debt, interest rate | 5% | 5% |
Fair Value | Long-Term Debt | New Facilities loans Under Third Amended Credit Agreement due 2025 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, due date | 2025 | 2025 |
Fair Value | Long-Term Debt | Revenue bonds, due in varying amounts periodically through 2029 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, due date | 2029 | 2029 |
Fair Value | Long-Term Debt | American & Foreign Power Company, Inc. 5% debentures, due 2030 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Long-term debt, due date | 2030 | 2030 |
Long term debt, interest rate | 5% | 5% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Commitments and Contingencies Disclosure [Line Items] | |||
Purchases under the agreement | $ 354 | $ 336 | $ 326 |
Minimum | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Losses for environmental liabilities | 15 | ||
Maximum | |||
Commitments and Contingencies Disclosure [Line Items] | |||
Losses for environmental liabilities | $ 25 |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||
Feb. 28, 2023 | Dec. 25, 2021 | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||
Promissory note receivable obtained from disposition of discontinued operations | $ 55 | ||||
Professional fees | $ 1 | $ 21 | |||
Securities Purchase Agreement | CompuCom Division | |||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||
Cash purchase price | $ 125 | 125 | |||
Interest bearing promissory note | 55 | ||||
Provision for payment | $ 125 | ||||
Accrues interest of promissory note | 6% | ||||
Capital investment percentage | 15% | ||||
Dividend percentage | 50% | ||||
Aggregate sale proceeds | $ 125 | ||||
Estimated fair value | 190 | 190 | |||
Cash purchase price | 126 | 30 | 126 | ||
Earnout payment | $ 9 | ||||
Loss from classification to held for sale | $ 170 | ||||
Total receivable | 9 | ||||
Current receivable | 5 | ||||
Non-current receivable | $ 4 | 4 | |||
Promissory note receivable obtained from disposition of discontinued operations | $ 59 | ||||
Loss on disposal | 21 | ||||
Partially offset losses | 10 | ||||
Securities Purchase Agreement | CompuCom Division | Third-Party Professional Fees | |||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||
Professional fees | $ 2 | ||||
Securities Purchase Agreement | Minimum | CompuCom Division | |||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||
Purchase period | 3 months | ||||
Securities Purchase Agreement | Maximum | CompuCom Division | |||||
Income Statement Balance Sheet And Additional Disclosures By Disposal Groups Including Discontinued Operations [Line Items] | |||||
Purchase period | 12 months |
Major Component of Discontinued
Major Component of Discontinued Operations, Net of Tax (Detail) - Discontinued Operations, Held-for-Sale - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Major components of discontinued operations before income taxes: | |||
Sales | $ 802 | $ 838 | |
Cost of goods and occupancy costs | 645 | 657 | |
Gross profit | 157 | 181 | |
Selling, general and administrative expenses | 152 | 171 | |
Asset impairments | 252 | 248 | |
Merger, restructuring and other operating expenses, net | (2) | 20 | |
Operating loss | (245) | (258) | |
Other income (expense), net | (1) | 1 | |
Loss from major components of discontinued operations before income taxes | (246) | (257) | |
Loss from classification to held for sale | $ (13) | (170) | |
Loss from discontinued operations before income taxes | (13) | (416) | (257) |
Income tax benefit | (1) | (21) | (1) |
Discontinued operations, net of tax | $ (12) | $ (395) | $ (256) |
Major Classes of Assets and Lia
Major Classes of Assets and Liabilities of Disposal Group Classified as Held for Sale (Detail) - CompuCom Division - Discontinued Operations, Held-for-Sale $ in Millions | Dec. 25, 2021 USD ($) |
Major classes of assets included in discontinued operations: | |
Cash and cash equivalents | $ 23 |
Receivables, net | 221 |
Inventories | 20 |
Prepaid expenses and other current assets | 15 |
Property and equipment, net | 25 |
Operating lease right-of-use assets | 66 |
Other intangible assets, net | 255 |
Other assets | 14 |
Less: valuation allowance | (170) |
Total assets of the disposal group classified as held for sale | 469 |
Major classes of liabilities included in discontinued operations: | |
Trade accounts payable | 83 |
Accrued expenses and other current liabilities | 86 |
Deferred income taxes and other long-term liabilities | 75 |
Operating lease liabilities | 46 |
Total liabilities of the disposal group classified as held for sale | $ 290 |
Schedule of Quarterly Financial
Schedule of Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2022 | [1] | Sep. 24, 2022 | [1] | Jun. 25, 2022 | [1] | Mar. 26, 2022 | [1] | Dec. 25, 2021 | [1] | Sep. 25, 2021 | [1] | Jun. 26, 2021 | [1] | Mar. 27, 2021 | [1] | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||
Net sales | $ 2,106 | $ 2,172 | $ 2,034 | $ 2,178 | $ 2,042 | $ 2,179 | $ 2,070 | $ 2,174 | $ 8,491 | $ 8,465 | $ 8,872 | ||||||||
Gross profit | 446 | 486 | 431 | 484 | 432 | 504 | 432 | 495 | 1,848 | 1,863 | 1,951 | ||||||||
Operating income | 55 | [2] | 84 | [2] | 28 | [2] | 76 | [2] | 31 | [3] | 104 | [3] | 30 | [3] | 69 | [3] | 243 | 234 | 6 |
Net income (loss) from continuing operations | 36 | 67 | 20 | 55 | 32 | 73 | 20 | 63 | 178 | 187 | (63) | ||||||||
Discontinued operations, net of tax | (19) | 7 | (306) | 28 | (108) | (10) | (12) | (395) | (256) | ||||||||||
Net income (loss) | $ 17 | $ 67 | $ 27 | $ 55 | $ (274) | $ 101 | $ (88) | $ 53 | $ 166 | $ (208) | $ (319) | ||||||||
Basic earnings (loss) per share | |||||||||||||||||||
Continuing operations | $ 0.79 | [4] | $ 1.39 | [4] | $ 0.40 | [4] | $ 1.14 | [4] | $ 0.63 | [5] | $ 1.38 | [5] | $ 0.36 | [5] | $ 1.17 | [5] | $ 3.73 | $ 3.54 | $ (1.20) |
Discontinued operations | (0.41) | [4] | (0.01) | [4] | 0.15 | [4] | (6.07) | [5] | 0.54 | [5] | (1.98) | [5] | (0.18) | [5] | (0.25) | (7.47) | (4.85) | ||
Net basic earnings (loss) per share | 0.38 | [4] | 1.38 | [4] | 0.55 | [4] | 1.14 | [4] | (5.44) | [4] | 1.92 | [4] | (1.62) | [4] | 0.99 | [4] | 3.48 | (3.93) | (6.05) |
Diluted earnings (loss) per share | |||||||||||||||||||
Continuing operations | 0.76 | [4] | 1.36 | [4] | 0.39 | [4] | 1.09 | [4] | 0.61 | [5] | 1.33 | [5] | 0.35 | [5] | 1.12 | [5] | 3.61 | 3.42 | (1.20) |
Discontinued operations | (0.40) | [4] | (0.01) | [4] | 0.15 | [4] | (5.87) | [5] | 0.52 | [5] | (1.93) | [5] | (0.17) | [5] | (0.24) | (7.21) | (4.85) | ||
Net diluted earnings (loss) per share | $ 0.36 | [4] | $ 1.35 | [4] | $ 0.54 | [4] | $ 1.09 | [4] | $ (5.26) | [4] | $ 1.85 | [4] | $ (1.58) | [4] | $ 0.95 | [4] | $ 3.37 | $ (3.79) | $ (6.05) |
[1]Due to rounding, the sum of the quarterly amounts may not equal the reported amounts for the year.[2]Includes Merger, restructuring and other operating expenses, net totaling $10 million, $23 million, $8 million and ($3) million in the first, second, third and fourth quarters of 2022 , Includes Merger, restructuring and other operating expenses, net totaling $13 million, $11 million, $13 million and $14 million in the first, second, third and fourth quarters of 2021, respectively. The first, second, third and fourth quarters of 2021 also include asset impairments of $12 million, $1 million, $5 million and $2 million, respectively. The sum of the quarterly earnings (loss) per share does not equal the annual earnings (loss) per share due to differences in quarterly and annual weighted-average shares outstanding. |
Schedule of Quarterly Financi_2
Schedule of Quarterly Financial Data (Parenthetical) (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2022 | Sep. 24, 2022 | Jun. 25, 2022 | Mar. 26, 2022 | Dec. 25, 2021 | Sep. 25, 2021 | Jun. 26, 2021 | Mar. 27, 2021 | Dec. 31, 2022 | Dec. 25, 2021 | Dec. 26, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Merger, restructuring and other operating expenses, net | $ (3) | $ 8 | $ 23 | $ 10 | $ 14 | $ 13 | $ 11 | $ 13 | $ 39 | $ 51 | $ 102 |
Asset impairments | $ 6 | $ 3 | $ 3 | $ 2 | $ 2 | $ 5 | $ 1 | $ 12 | $ 14 | $ 20 | $ 182 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - Subsequent Event $ in Millions | 1 Months Ended |
Jan. 31, 2023 USD ($) | |
Minimum | |
Subsequent Event [Line Items] | |
Business combination consideration transferred | $ 5 |
Maximum | |
Subsequent Event [Line Items] | |
Business combination consideration transferred | $ 15 |