Document and Entity
Document and Entity - shares | 6 Months Ended | |
Apr. 09, 2017 | May 12, 2017 | |
Document and Entity [Abstract] | ||
Entity Registrant Name | WHOLE FOODS MARKET INC | |
Entity Central Index Key | 865,436 | |
Document Type | 10-Q | |
Entity Filer Category | Large Accelerated Filer | |
Current Fiscal Year End Date | --09-24 | |
Document Period End Date | Apr. 9, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 319,564,636 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Apr. 09, 2017 | Sep. 25, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 412 | $ 351 |
Short-term investments - available-for-sale securities | 476 | 379 |
Restricted cash | 124 | 122 |
Accounts receivable | 255 | 242 |
Merchandise inventories | 508 | 517 |
Prepaid expenses and other current assets | 119 | 167 |
Deferred income taxes | 214 | 197 |
Total current assets | 2,108 | 1,975 |
Property and equipment, net of accumulated depreciation and amortization | 3,469 | 3,442 |
Goodwill | 710 | 710 |
Intangible assets, net of accumulated amortization | 71 | 74 |
Deferred income taxes | 114 | 100 |
Other assets | 41 | 40 |
Total assets | 6,513 | 6,341 |
Current liabilities: | ||
Current installments of long-term debt and capital lease obligations | 2 | 3 |
Accounts payable | 313 | 307 |
Accrued payroll, bonus and other benefits due team members | 393 | 407 |
Dividends payable | 45 | 43 |
Other current liabilities | 584 | 581 |
Total current liabilities | 1,337 | 1,341 |
Long-term debt and capital lease obligations, less current installments | 1,047 | 1,048 |
Deferred lease liabilities | 665 | 640 |
Other long-term liabilities | 105 | 88 |
Total liabilities | 3,154 | 3,117 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Common stock, no par value, 1,200 shares authorized; 377.0 shares issued; 318.8 and 318.3 shares outstanding at 2017 and 2016, respectively | 2,945 | 2,933 |
Common stock in treasury, at cost, 58.2 and 58.7 shares at 2017 and 2016, respectively | (2,004) | (2,026) |
Accumulated other comprehensive loss | (35) | (32) |
Retained earnings | 2,453 | 2,349 |
Total shareholders’ equity | 3,359 | 3,224 |
Total liabilities and shareholders’ equity | $ 6,513 | $ 6,341 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Apr. 09, 2017 | Sep. 25, 2016 |
Statement of Financial Position [Abstract] | ||
Common Stock, Shares Authorized | 1,200,000,000 | 1,200,000,000 |
Common Stock, Shares, Issued | 377,000,000 | 377,000,000 |
Common Stock, Shares, Outstanding | 318,800,000 | 318,300,000 |
Common Stock, No Par Value | ||
Treasury Stock, Shares | 58,200,000 | 58,700,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 4 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Apr. 09, 2017 | Sep. 25, 2016 | Jul. 03, 2016 | Apr. 10, 2016 | Jan. 15, 2017 | Jan. 17, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Income Statement [Abstract] | |||||||||
Sales | $ 3,737 | $ 3,696 | $ 8,656 | $ 8,524 | |||||
Cost of goods sold and occupancy costs | 2,463 | 2,406 | 5,732 | 5,593 | |||||
Gross profit | 1,274 | 1,290 | 2,924 | 2,931 | |||||
Selling, general and administrative expenses | 1,057 | 1,028 | 2,474 | 2,402 | |||||
Pre-opening expenses | 12 | 18 | 33 | 31 | |||||
Relocation, store closure and lease termination costs | 34 | 3 | 74 | 5 | |||||
Operating income | 171 | 241 | 343 | 493 | |||||
Interest expense | (11) | (11) | (26) | (18) | |||||
Investment and other income | 2 | 5 | 1 | 9 | |||||
Income before income taxes | 162 | 235 | 318 | 484 | |||||
Provision for income taxes | 63 | 93 | 124 | 185 | |||||
Net income | $ 99 | $ 142 | $ 194 | $ 299 | $ 507 | ||||
Basic earnings per share (in dollars per share) | $ 0.31 | $ 0.44 | $ 0.61 | $ 0.90 | |||||
Weighted average shares outstanding (in shares) | 318.5 | 324.7 | 318.3 | 331.7 | |||||
Diluted earnings per share (in dollars per share) | $ 0.31 | $ 0.44 | $ 0.61 | $ 0.90 | |||||
Weighted average shares outstanding, diluted basis (in shares) | 318.9 | 325.4 | 318.7 | 332.7 | |||||
Dividends declared per common share (in dollars per share) | $ 0.14 | $ 0.135 | $ 0.135 | $ 0.135 | $ 0.14 | $ 0.135 | $ 0.28 | $ 0.27 | $ 0.54 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Apr. 09, 2017 | Apr. 10, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Statement of Comprehensive Income [Abstract] | |||||
Net income | $ 99 | $ 142 | $ 194 | $ 299 | $ 507 |
Other comprehensive loss, net of tax: | |||||
Foreign currency translation adjustments | (2) | 10 | (3) | ||
Other comprehensive loss, net of tax | (2) | 10 | (3) | $ (4) | |
Comprehensive income | $ 97 | $ 152 | $ 191 | $ 299 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Common stock | Common stock in treasury | Accumulated other comprehensive loss | Retained earnings |
Balances at Sep. 27, 2015 | $ 3,769 | $ 2,904 | $ (1,124) | $ (28) | $ 2,017 |
Balances (in shares) at Sep. 27, 2015 | 348.9 | ||||
Increase (Decrease) in Shareholders' Equity | |||||
Net income | 507 | 507 | |||
Other comprehensive income (loss), net of tax | (4) | (4) | |||
Dividends ($0.28 and $0.54 per common share for the twenty-eight weeks ended April 9, 2017 and fiscal year ended September 27, 2016, respectively) | (174) | (174) | |||
Issuance of common stock pursuant to team member stock plans | 19 | $ (23) | 42 | ||
Issuance of common stock pursuant to team member stock plans (in shares) | 1.1 | ||||
Purchase of treasury stock | (944) | (944) | |||
Purchase of treasury stock (in shares) | (31.7) | ||||
Tax benefit related to exercise of team member stock options | 3 | $ 3 | |||
Share-based payment expense | 49 | 49 | |||
Other | (1) | (1) | |||
Balances at Sep. 25, 2016 | $ 3,224 | $ 2,933 | (2,026) | (32) | 2,349 |
Balances (in shares) at Sep. 25, 2016 | 318.3 | 318.3 | |||
Increase (Decrease) in Shareholders' Equity | |||||
Net income | $ 194 | 194 | |||
Other comprehensive income (loss), net of tax | (3) | (3) | |||
Dividends ($0.28 and $0.54 per common share for the twenty-eight weeks ended April 9, 2017 and fiscal year ended September 27, 2016, respectively) | (89) | (89) | |||
Issuance of common stock pursuant to team member stock plans | 12 | $ (10) | 22 | ||
Issuance of common stock pursuant to team member stock plans (in shares) | 0.5 | ||||
Tax benefit related to exercise of team member stock options | $ (1) | ||||
Adjustments to Additional Paid in Capital, Income Tax Deficiency from Share-based Compensation | (1) | ||||
Share-based payment expense | 23 | 23 | |||
Other | (1) | (1) | |||
Balances at Apr. 09, 2017 | $ 3,359 | $ 2,945 | $ (2,004) | $ (35) | $ 2,453 |
Balances (in shares) at Apr. 09, 2017 | 318.8 | 318.8 |
Consolidated Statements of Sha7
Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares | 3 Months Ended | 4 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Apr. 09, 2017 | Sep. 25, 2016 | Jul. 03, 2016 | Apr. 10, 2016 | Jan. 15, 2017 | Jan. 17, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Statement of Stockholders' Equity [Abstract] | |||||||||
Dividends declared per common share (in dollars per share) | $ 0.14 | $ 0.135 | $ 0.135 | $ 0.135 | $ 0.14 | $ 0.135 | $ 0.28 | $ 0.27 | $ 0.54 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Apr. 09, 2017 | Apr. 10, 2016 | |
Cash flows from operating activities | ||
Net income | $ 194 | $ 299 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 305 | 259 |
Share-based payment expense | 23 | 28 |
LIFO expense | 3 | 4 |
Deferred income tax expense | (31) | 5 |
Excess tax benefit related to exercise of team member stock options | (1) | |
Accretion of premium/discount on marketable securities | 1 | 1 |
Deferred lease liabilities | 34 | 18 |
Other | 6 | 1 |
Net change in current assets and liabilities: | ||
Accounts receivable | (11) | (12) |
Merchandise inventories | 6 | (25) |
Prepaid expenses and other current assets | 54 | (54) |
Accounts payable | 6 | 4 |
Accrued payroll, bonus and other benefits due team members | (13) | (39) |
Other current liabilities | 30 | 76 |
Net change in other long-term liabilities | 17 | 11 |
Net cash provided by operating activities | 624 | 575 |
Cash flows from investing activities | ||
Development costs of new locations | (227) | (197) |
Other property and equipment expenditures | (149) | (141) |
Purchases of available-for-sale securities | (356) | (176) |
Sales and maturities of available-for-sale securities | 258 | 350 |
Payment for purchase of acquired entities, net of cash acquired | (11) | |
Other investing activities | (6) | (10) |
Net cash used in investing activities | (480) | (185) |
Cash flows from financing activities | ||
Purchases of treasury stock | (734) | |
Common stock dividends paid | (88) | (90) |
Issuance of common stock | 10 | 11 |
Excess tax benefit related to exercise of team member stock options | 1 | |
Proceeds from long-term borrowings | 999 | |
Proceeds from revolving line of credit | 300 | |
Payments on long-term debt and capital lease obligations | (2) | (305) |
Other financing activities | (1) | (8) |
Net cash provided by (used in) financing activities | (81) | 174 |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 2 | |
Net change in cash, cash equivalents, and restricted cash | 63 | 566 |
Cash, cash equivalents, and restricted cash at beginning of period | 473 | 364 |
Cash, cash equivalents, and restricted cash at end of period | 536 | 930 |
Supplemental disclosure of cash flow information: | ||
Federal and state income taxes paid | 142 | $ 229 |
Interest paid | $ 26 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Apr. 09, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | Basis of Presentation The accompanying unaudited consolidated financial statements of Whole Foods Market, Inc. and its consolidated subsidiaries (collectively “Whole Foods Market,” “Company,” or “we”) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial statements and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The information included in this Form 10-Q should be read in conjunction with Management’s Discussion and Analysis and the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 25, 2016 . In the opinion of management, the accompanying consolidated financial statements reflect all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation. Where appropriate, we have reclassified prior year financial statements to conform to current year presentation. Interim results are not necessarily indicative of results for any other interim period or for a full fiscal year. The Company reports its results of operations on a 52 - or 53 -week fiscal year ending on the last Sunday in September. The first fiscal quarter is 16 weeks, the second and third quarters each are 12 weeks, and the fourth quarter is 12 or 13 weeks. Fiscal years 2017 and 2016 are 52 -week years. The Company has one operating segment and a single reportable segment, natural and organic foods supermarkets. The following is a summary of percentage sales by geographic area for the periods indicated: Twelve weeks ended Twenty-eight weeks ended April 9, April 10, April 9, April 10, Sales: United States 97.1 % 97.1 % 97.1 % 97.1 % Canada and United Kingdom 2.9 2.9 2.9 2.9 Total sales 100.0 % 100.0 % 100.0 % 100.0 % The following is a summary of the percentage of net long-lived assets by geographic area as of the dates indicated: April 9, September 25, Long-lived assets, net: United States 97.5 % 97.5 % Canada and United Kingdom 2.5 2.5 Total long-lived assets, net 100.0 % 100.0 % |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Apr. 09, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | Summary of Significant Accounting Policies Recent Accounting Pronouncements Effective September 26, 2016, the Company early adopted the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Update (“ASU”) No. 2016-18, “Statement of Cash Flows: Restricted Cash ,” which amends the Accounting Standards Codification Topic 230. The amendments, which require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash, were adopted on a retrospective basis. The adoption of these amendments did not have a significant effect on the Company’s financial statements. The following table provides a brief description of recently issued accounting pronouncements that have not yet been adopted. Early adoption is permitted for all updates unless stated. Standard Description Effective Date Effect on financial statements and other significant matters ASU No. 2017-04 Simplifying the Test for Goodwill Impairment (Topic 350) The amendments eliminate Step 2 from the goodwill impairment test. Instead, an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value should be recognized; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss should also be considered, if applicable. The amendments should be applied on a prospective basis. First quarter of fiscal year ending September 27, 2020 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-13 Measurement of Credit Losses on Financial Instruments(Topic 326) The amendments guide on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities. The amendments require a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. The amendments also require that credit losses on available-for-sale debt securities be presented as an allowance. The amendments should be applied on either a prospective transition or modified-retrospective approach depending on the subtopic. First quarter of fiscal year ending September 29, 2021 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-09 Improvements to Employee Share-Based Payment Accounting (Topic 718) The amendments aim to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, forfeitures, and certain classifications on the statement of cash flows. The amendments should be applied on either a prospective, retrospective, or modified-retrospective basis depending on the subtopic. First quarter of fiscal year ending September 30, 2018 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-08 Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (Topic 606) The amendments, which do not change the core principle of the guidance in Topic 606, clarify the implementation guidance on principal versus agent considerations, including how an entity should identify the unit of accounting (i.e., the specified good or service) for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. The amendments may be applied on either a full or modified retrospective basis. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-07 Simplifying the Transition to the Equity Method of Accounting (Topic 323) The amendments eliminate the requirement to retroactively apply the equity method of accounting when an investment qualifies for the use of the equity method due to an increase in the level of ownership interest or degree of influence. The amendments should be applied on a prospective basis. First quarter of fiscal year ending September 30, 2018 We do not expect the adoption of these provisions to have a significant impact on the Company’s consolidated financial statements. Standard Description Effective Date Effect on financial statements and other significant matters ASU No. 2016-04 Recognition of Breakage for Certain Prepaid Stored-Value Products (a consensus of the Emerging Issues Task Force) (Subtopic 405-20) The amendments require entities to recognize liabilities related to the sale of prepaid stored-value products redeemable for goods, services or cash as financial liabilities in the scope of ASC 405. Additionally, the new guidance amends ASC 405-20 to include a narrow scope exception requiring entities to recognize breakage for these liabilities in a way that is consistent with how gift card breakage will be recognized under the new revenue recognition standard. The amendments may be applied on either a full or modified retrospective basis. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-02 Leases (Topic 842) The amendments require lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses will depend on classification as a finance or operating lease. The amendments also require certain quantitative and qualitative disclosures. Accounting guidance for lessors is largely unchanged. The amendments should be applied on a modified retrospective basis. First quarter of fiscal year ending September 27, 2020 The adoption of this ASU will result in a significant increase to the Company’s Consolidated Balance Sheets for lease liabilities and right-of-use assets, and the Company is currently evaluating the other effects of adoption of this ASU on its Consolidated Financial Statements. ASU No. 2016-01 Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10) The amendments address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The amendments should be applied by means of a cumulative-effect adjustment to the balance sheet in year of adoption. Early adoption is permitted for only certain amendments of the update. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2015-17 Balance Sheet Classification of Deferred Taxes (Topic 740) The amendments simplify the presentation of deferred income taxes by requiring that all deferred tax liabilities and assets be classified as noncurrent in the statement of financial position. The amendments may be applied on either a prospective or retrospective basis. First quarter of fiscal year ending September 30, 2018 We do not expect the adoption of these provisions to have a significant impact on the Company’s consolidated financial statements. ASU No. 2015-11 Simplifying the Measurement of Inventory (Topic 330) The amendments, which apply to inventory that is measured using any method other than the last-in, first-out (LIFO) or retail inventory method, require that entities measure inventory at the lower of cost and net realizable value. The amendments should be applied on a prospective basis. First quarter of fiscal year ending September 30, 2018 We do not expect the adoption of these provisions to have a significant impact on the Company’s consolidated financial statements. ASU No. 2014-09 Revenue from Contracts with Customers (Topic 606) The core principle of the new guidance is that an entity will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additionally, the guidance requires disclosures related to the nature, amount, timing, and uncertainty of revenue that is recognized. The amendments may be applied on either a full or modified retrospective basis. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the timing, method, and impact that the adoption of these provisions will have on the Company’s consolidated financial statements. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Apr. 09, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | Fair Value Measurements The Company holds money market fund investments that are classified as cash equivalents that are measured at fair value on a recurring basis based on quoted prices in active markets for identical assets. The Company also holds available-for-sale securities that are valued using a series of multi-dimensional relational models and series of matrices with standard inputs obtained from readily available pricing sources and other observable market data, such as benchmark yields and base spread. Equity interests measured at fair value are based on quoted prices for similar assets in active markets. The carrying amounts of accrued payroll, bonuses and other benefits due team members, and other accrued expenses approximate fair value because of their short maturities. Store closure reserves and estimated workers’ compensation claims are recorded at net present value to approximate fair value. Assets Measured at Fair Value on a Recurring Basis The Company held the following financial assets measured at fair value on a recurring basis based on the hierarchy levels indicated (in millions): April 9, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Cash equivalents: Money market fund $ 2 $ — $ — $ 2 Marketable securities - available-for-sale: Municipal bonds — 25 — 25 Variable-rate demand notes — 451 — 451 Total $ 2 $ 476 $ — $ 478 September 25, 2016 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Cash equivalents: Money market fund $ 62 $ — $ — $ 62 Commercial paper — 30 — 30 Municipal bonds — 46 — 46 Marketable securities - available-for-sale: Commercial paper — 30 — 30 Municipal bonds — 26 — 26 Variable rate demand notes — 323 — 323 Total $ 62 $ 455 $ — $ 517 The estimated fair value of the Company’s long-term debt is included in Note 8 “Long-Term Debt.” Assets Measured at Fair Value on a Nonrecurring Basis During the twenty-eight weeks ended April 9, 2017, the Company recorded fair value adjustments, based on hierarchy level 3 inputs, totaling approximately $34 million related to certain locations for which asset value exceeded expected future cash flows, which were primarily included in the “Relocation, store closure and lease termination cost” line item on the Consolidated Statement of Operations. These impairment charges reduced the carrying value of related long-term assets to an immaterial fair value. |
Investments
Investments | 6 Months Ended |
Apr. 09, 2017 | |
Investments [Abstract] | |
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] | Investments The Company holds investments primarily in marketable securities that are classified as short-term available-for-sale securities. The Company held the following investments at fair value as of the dates indicated (in millions): April 9, September 25, Short-term marketable securities - available-for-sale: Commercial paper $ — $ 30 Municipal bonds 25 26 Variable rate demand notes 451 323 Total short-term marketable securities $ 476 $ 379 Gross unrealized holding gains and losses were not material at April 9, 2017 or September 25, 2016 . There were no available-for-sale securities in an unrealized loss position at April 9, 2017 . Available-for-sale securities totaling approximately $33 million were in unrealized loss positions at September 25, 2016 . The aggregate value of available-for-sale securities in a continuous unrealized loss position for greater than 12 months was not material at September 25, 2016 . The Company did not recognize any other-than-temporary impairments during the twenty-eight weeks ended April 9, 2017 or fiscal year ended September 25, 2016 . The average effective maturity of the Company’s short-term available-for-sale securities was less than one month at April 9, 2017 and September 25, 2016 . At April 9, 2017 and September 25, 2016 , the Company held approximately $24 million and $19 million in equity interests which were accounted for using the cost method of accounting. Equity interests accounted for using the equity method were not material at April 9, 2017 or September 25, 2016 . |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 6 Months Ended |
Apr. 09, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure [Text Block] | Goodwill and Other Intangible Assets There were no additions or adjustments to goodwill during the twenty-eight weeks ended April 9, 2017 or April 10, 2016 . Additions of other intangible assets were not material during the twenty-eight weeks ended April 9, 2017 or the same period of the prior fiscal year. The components of intangible assets as of the dates indicated were as follows (in millions): April 9, 2017 September 25, 2016 Gross carrying amount Accumulated amortization Gross carrying amount Accumulated amortization Definite-lived contract-based $ 118 $ (56 ) $ 120 $ (55 ) Indefinite-lived contract-based 9 9 Total $ 127 $ (56 ) $ 129 $ (55 ) Amortization expense associated with intangible assets was not material during the twelve weeks ended April 9, 2017 or the same period of the prior fiscal year. Future amortization expense associated with the net carrying amount of definite-lived intangible assets is estimated to be as follows (in millions): Remainder of fiscal year 2017 $ 3 Fiscal year 2018 5 Fiscal year 2019 5 Fiscal year 2020 5 Fiscal year 2021 4 Future fiscal years 40 Total $ 62 |
Store and Facility Closures
Store and Facility Closures | 6 Months Ended |
Apr. 09, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Disclosure [Text Block] | Store and Facility Closures During the first quarter of fiscal year 2017, the Company announced plans to close nine stores and three commissary kitchens and recorded non-cash charges of approximately $ 34 million to adjust the long-lived assets of these locations to fair value. During the second quarter of fiscal year 2017, the Company closed all nine stores and all three commissary kitchens and recorded additional charges of $30 million primarily related to remaining lease obligations and Team Member severance. The Company expects to incur no material additional charges related to these closures. |
Reserves for Closed Properties
Reserves for Closed Properties | 6 Months Ended |
Apr. 09, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring, Impairment, and Other Activities Disclosure [Text Block] | Reserves for Closed Properties The following table provides a summary of activity in reserves for closed properties during the twenty-eight weeks ended April 9, 2017 and fiscal year ended September 25, 2016 (in millions): April 9, September 25, Beginning balance $ 26 $ 28 Additions 27 6 Usage (5 ) (10 ) Adjustments 1 2 Ending balance $ 49 $ 26 |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Apr. 09, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt [Text Block] | Long-Term Debt Credit Agreement The Company’s revolving credit facility under a credit agreement dated as of November 2, 2015 (the “Credit Agreement”) provides for an unsecured revolving credit facility in the aggregate principal amount of $500 million , which may be increased from time to time by up to $250 million . The Credit Agreement also provides for a letter of credit subfacility of up to $250 million . At April 9, 2017 , the Company had no amounts outstanding under the credit facility. Commitment fees paid on undrawn amounts were not material during the twenty-eight weeks ended April 9, 2017 . At April 9, 2017 , the Company was in compliance with its covenants under the Credit Agreement. During the twenty-eight weeks ended April 10, 2016 , the Company borrowed and repaid $300 million under the Credit Agreement. At April 10, 2016 , the Company had no amounts outstanding. Senior Notes The Company has outstanding $ 1.0 billion of senior notes (the “Notes”). The Notes bear interest at a fixed rate equal to 5.2% per year, payable semiannually , and mature on December 3, 2025 . The effective interest rate of the Notes, which includes interest on the Notes and amortization of discount and issuance costs, is approximately 5.28% . At April 9, 2017 , the Company was in compliance with all covenants under the indenture governing the Notes. The estimated fair value of the Notes at April 9, 2017 , based on observable market prices (Level 2), exceeded the carrying value by approximately $72 million . The Notes and Credit Agreement are fully and unconditionally guaranteed, jointly and severally, on an unsecured basis by certain wholly owned domestic subsidiaries of the Company (the “Guarantors”). For additional information regarding the Guarantors see Note 14, Guarantor Financial Statement Information. The components of long-term debt as of the dates indicated were as follows (in millions): April 9, September 25, 5.2% senior notes due 2025 $ 1,000 $ 1,000 Less: unamortized discount and debt issuance costs related to senior notes (7 ) (7 ) Carrying value of senior notes 993 993 Capital lease obligations 56 58 Total long-term debt and capital lease obligations 1,049 1,051 Less: current installments (2 ) (3 ) Total long-term debt and capital lease obligations, less current installments $ 1,047 $ 1,048 |
Income Taxes
Income Taxes | 6 Months Ended |
Apr. 09, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | Income Taxes Income taxes resulted in an effective tax rate of approximately 39.0% for the twelve and twenty-eight weeks ended April 9, 2017 compared to approximately 39.5% and 38.2% , respectively, for the same periods of the prior fiscal year. The lower effective tax rate for the twenty-eight weeks ended April 10, 2016 was due to the recognition of an environmental tax credit related to the development of a new store. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Apr. 09, 2017 | |
Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | Shareholders’ Equity Dividends per Common Share The following table provides a summary of dividends declared per common share during fiscal year 2017 to date and fiscal year 2016 (in millions, except per share amounts): Date of declaration Dividend per common share Date of record Date of payment Total amount Fiscal year 2017: November 2, 2016 $ 0.14 January 13, 2017 January 24, 2017 $ 45 February 17, 2017 (1) 0.14 April 7, 2017 April 18, 2017 45 Fiscal year 2016: November 4, 2015 $ 0.135 January 15, 2016 January 26, 2016 $ 44 March 9, 2016 0.135 April 8, 2016 April 19, 2016 44 June 7, 2016 0.135 July 1, 2016 July 12, 2016 43 September 22, 2016 0.135 October 3, 2016 October 14, 2016 43 (1) Dividend accrued at April 9, 2017 On May 10, 2017, the Company’s Board of Directors (“Board”) announced a 29% increase in the regular quarterly dividend to $0.18 per share, and the next quarterly dividend to be declared is expected to be payable on July 11, 2017 to shareholders of record as of June 30, 2017. Treasury Stock As of April 9, 2017 , one share repurchase program remained in effect, with prior programs having been fully utilized, expired or cancelled. The following table outlines the share repurchase program authorized by the Board, and the related repurchase activity as of April 9, 2017 (in millions): Effective date Expiration date Amount authorized Cost of repurchases Authorization available November 4, 2015 Not applicable $ 1,000 $ 557 $ 443 Share repurchase activity for the twelve and twenty-eight weeks ended April 9, 2017 was immaterial. Share repurchase activity for the twelve and twenty-eight weeks ended April 10, 2016 was as follows (in millions, except per share amounts): Twelve weeks ended Twenty-eight weeks ended April 10, April 10, Number of common shares acquired 3.5 24.6 Average price per common share acquired $ 28.88 $ 29.81 Total cost of common shares acquired $ 100 $ 734 On May 10, 2017, the Board authorized a new $1.25 billion share repurchase program, with the intent to opportunistically utilize the authorization over the next 18 months. The new authorization will replace the Company’s existing program. The Company reissued approximately 0.6 million treasury shares at cost of approximately $21 million and approximately 0.5 million treasury shares at cost of approximately $22 million to satisfy the issuance of common stock pursuant to team member stock plans during the twenty-eight weeks ended April 9, 2017 and April 10, 2016 , respectively. At April 9, 2017 and September 25, 2016 , the Company held in treasury approximately 58.2 million shares and 58.7 million shares, respectively, totaling approximately $2.0 billion . |
Earnings per Share
Earnings per Share | 6 Months Ended |
Apr. 09, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | Earnings per Share The computation of basic earnings per share is based on the number of weighted average common shares outstanding during the period. The computation of diluted earnings per share includes the dilutive effect of common stock equivalents consisting of incremental common shares deemed outstanding from the assumed exercise of stock options and the dilutive effect of restricted stock awards. A reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations follows (in millions, except per share amounts): Twelve weeks ended Twenty-eight weeks ended April 9, April 10, April 9, April 10, Net income (numerator for basic and diluted earnings per share) $ 99 $ 142 $ 194 $ 299 Weighted average common shares outstanding (denominator for basic earnings per share) 318.5 324.7 318.3 331.7 Incremental common shares attributable to dilutive effect of share-based awards 0.4 0.7 0.4 1.0 Weighted average common shares outstanding and potential additional common shares outstanding (denominator for diluted earnings per share) 318.9 325.4 318.7 332.7 Basic earnings per share $ 0.31 $ 0.44 $ 0.61 $ 0.90 Diluted earnings per share $ 0.31 $ 0.44 $ 0.61 $ 0.90 The computation of diluted earnings per share for the twelve and twenty-eight weeks ended April 9, 2017 and does not include share-based awards to purchase approximately 24.0 million shares and 24.3 million shares of common stock, respectively, due to their antidilutive effect. The computation of diluted earnings per share for the twelve and twenty-eight weeks ended April 10, 2016 does not include share-based awards to purchase approximately 20.9 million shares and 19.7 million shares of common stock, respectively, due to their antidilutive effect. |
Share-Based Payments
Share-Based Payments | 6 Months Ended |
Apr. 09, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] | Share-Based Payments Share-based payment expense, primarily included in the “Selling, general and administrative expenses” line item on the Consolidated Statements of Operations, totaled approximately $9 million and $23 million , respectively, during the twelve and twenty-eight weeks ended April 9, 2017 , and totaled approximately $12 million and $28 million , respectively, for the same periods of the prior fiscal year. At April 9, 2017 and September 25, 2016 , approximately 31.2 million shares and 29.8 million shares of the Company’s common stock, respectively, were available for future stock incentive grants. At April 9, 2017 and September 25, 2016 , there was approximately $51 million and $73 million of unrecognized share-based payment expense, respectively, related to unvested stock options, net of estimated forfeitures, related to approximately 9.7 million shares and 10.5 million shares, respectively. The Company anticipates this expense to be recognized over a weighted average period of 2.5 years. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Apr. 09, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | Commitments and Contingencies The Company is exposed to claims and litigation matters arising in the ordinary course of business and uses various methods to resolve these matters in a manner that we believe best serves the interests of our stakeholders. From time to time we are a party to legal proceedings including matters involving shareholder claims, personnel and employment issues, personal injury, product liability, protecting our intellectual property, regulatory practices, acquisitions and other proceedings arising in the ordinary course of business. These matters have not resulted in any material losses to date. Certain litigation cases have been certified as class or collective actions and may seek substantial damages. Our primary contingencies are associated with insurance and self-insurance obligations and litigation matters. Additionally, the Company has retention agreements with certain members of Company management which provide for payments under certain circumstances including change of control. Estimation of our insurance and self-insurance liabilities requires significant judgments, and actual claim settlements and associated expenses may differ from our current provisions for loss. We have exposures to loss contingencies arising from pending or threatened litigation for which assessing and estimating the outcomes of these matters involve substantial uncertainties. The Company evaluates contingencies on an ongoing basis and has established loss provisions for matters in which losses are probable and the amount of loss can be reasonably estimated, and is not currently a party to any legal proceeding that management believes could have a material adverse effect on our results of operations. Insurance and legal settlement liabilities are included in the “Other current liabilities” line item on the Consolidated Balance Sheets. We believe the recorded reserves in our consolidated financial statements are adequate in light of the probable and estimable liabilities. |
Guarantor Financial Statements
Guarantor Financial Statements | 6 Months Ended |
Apr. 09, 2017 | |
Guarantor Financial Statements [Abstract] | |
Guarantor Financial Statements [Text Block] | Guarantor Financial Statement Information The Senior Notes issued on December 3, 2015 and Credit Agreement are fully and unconditionally guaranteed, jointly and severally, on an unsecured, unsubordinated basis by certain wholly owned domestic subsidiaries of the Company (the “Guarantors”). Supplemental condensed consolidating financial information of the Company, including such information for the Guarantors is presented below: Consolidated Balance Sheets (unaudited) (In millions) April 9, 2017 Assets Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Current assets: Cash and cash equivalents $ — $ 310 $ 102 $ — $ 412 Short-term investments - available-for-sale securities — 476 — — 476 Restricted cash — 118 6 — 124 Accounts receivable — 233 22 — 255 Intercompany receivable — 728 — (728 ) — Merchandise inventories — 438 70 — 508 Prepaid expenses and other current assets 1 75 43 — 119 Deferred income taxes — 214 — — 214 Total current assets 1 2,592 243 (728 ) 2,108 Property and equipment, net of accumulated depreciation and amortization — 3,082 387 — 3,469 Investments in consolidated subsidiaries 4,802 107 476 (5,385 ) — Goodwill — 703 7 — 710 Intangible assets, net of accumulated amortization 1 61 9 — 71 Deferred income taxes — 108 6 — 114 Other assets — 13 28 — 41 Total assets $ 4,804 $ 6,666 $ 1,156 $ (6,113 ) $ 6,513 Liabilities and Shareholders’ Equity Current liabilities: Current installments of long-term debt and capital lease obligations $ — $ 2 $ — $ — $ 2 Accounts payable — 224 89 — 313 Intercompany payable 389 — 339 (728 ) — Accrued payroll, bonus and other benefits due team members — 368 25 — 393 Dividends payable 45 — — — 45 Other current liabilities 18 530 36 — 584 Total current liabilities 452 1,124 489 (728 ) 1,337 Long-term debt and capital lease obligations, less current installments 993 46 8 — 1,047 Deferred lease liabilities — 615 50 — 665 Other long-term liabilities — 104 1 — 105 Total liabilities 1,445 1,889 548 (728 ) 3,154 Commitments and contingencies Total shareholders’ equity 3,359 4,777 608 (5,385 ) 3,359 Total liabilities and shareholders’ equity $ 4,804 $ 6,666 $ 1,156 $ (6,113 ) $ 6,513 Consolidated Balance Sheets (unaudited) (In millions) September 25, 2016 Assets Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Current assets: Cash and cash equivalents $ — $ 254 $ 97 $ — $ 351 Short-term investments - available-for-sale securities — 379 — — 379 Restricted cash — 114 8 — 122 Accounts receivable — 216 26 — 242 Intercompany receivable — 649 — (649 ) — Merchandise inventories — 441 76 — 517 Prepaid expenses and other current assets — 150 17 — 167 Deferred income taxes — 197 — — 197 Total current assets — 2,400 224 (649 ) 1,975 Property and equipment, net of accumulated depreciation and amortization — 3,063 379 — 3,442 Investments in consolidated subsidiaries 4,593 103 472 (5,168 ) — Goodwill — 702 8 — 710 Intangible assets, net of accumulated amortization 1 63 10 — 74 Deferred income taxes — 94 6 — 100 Other assets — 16 24 — 40 Total assets $ 4,594 $ 6,441 $ 1,123 $ (5,817 ) $ 6,341 Liabilities and Shareholders’ Equity Current liabilities: Current installments of long-term debt and capital lease obligations $ — $ 3 $ — $ — $ 3 Accounts payable — 227 80 — 307 Intercompany payable 317 — 333 (650 ) — Accrued payroll, bonus and other benefits due team members — 381 26 — 407 Dividends payable 43 — — — 43 Other current liabilities 17 536 28 — 581 Total current liabilities 377 1,147 467 (650 ) 1,341 Long-term debt and capital lease obligations, less current installments 993 48 7 — 1,048 Deferred lease liabilities — 592 48 — 640 Other long-term liabilities — 87 1 — 88 Total liabilities 1,370 1,874 523 (650 ) 3,117 Commitments and contingencies Total shareholders’ equity 3,224 4,567 600 (5,167 ) 3,224 Total liabilities and shareholders’ equity $ 4,594 $ 6,441 $ 1,123 $ (5,817 ) $ 6,341 Consolidated Statements of Operations (unaudited) (In millions) Twelve weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 3,547 $ 220 $ (30 ) $ 3,737 Cost of goods sold and occupancy costs — 2,332 161 (30 ) 2,463 Gross profit — 1,215 59 — 1,274 Selling, general and administrative expenses — 1,001 56 — 1,057 Pre-opening expenses — 12 — — 12 Relocation, store closure and lease termination costs — 34 — — 34 Operating income — 168 3 — 171 Interest expense (11 ) — — — (11 ) Investment and other expense — — (1 ) 3 2 Equity in net income of subsidiaries 106 1 3 (110 ) — Income before income taxes 95 169 5 (107 ) 162 Provision for income taxes (4 ) 66 1 — 63 Net income $ 99 $ 103 $ 4 $ (107 ) $ 99 Twelve weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 3,512 $ 223 $ (39 ) $ 3,696 Cost of goods sold and occupancy costs — 2,290 155 (39 ) 2,406 Gross profit — 1,222 68 — 1,290 Selling, general and administrative expenses — 971 57 — 1,028 Pre-opening expenses — 17 1 — 18 Relocation, store closure and lease termination costs — 3 — — 3 Operating income — 231 10 — 241 Interest expense (11 ) — — — (11 ) Investment and other expense — 4 — 1 5 Equity in net income of subsidiaries 149 3 9 (161 ) — Income before income taxes 138 238 19 (160 ) 235 Provision for income taxes (4 ) 94 3 — 93 Net income $ 142 $ 144 $ 16 $ (160 ) $ 142 Consolidated Statements of Operations (unaudited) (In millions) Twenty-eight weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 8,219 $ 535 $ (98 ) $ 8,656 Cost of goods sold and occupancy costs — 5,442 386 (96 ) 5,732 Gross profit — 2,777 149 (2 ) 2,924 Selling, general and administrative expenses — 2,338 136 — 2,474 Pre-opening expenses — 30 3 — 33 Relocation, store closure and lease termination costs — 73 1 — 74 Operating income — 336 9 (2 ) 343 Interest expense (26 ) — — — (26 ) Investment and other expense — — (2 ) 3 1 Equity in net income of subsidiaries 210 3 4 (217 ) — Income before income taxes 184 339 11 (216 ) 318 Provision for income taxes (10 ) 131 3 — 124 Net income $ 194 $ 208 $ 8 $ (216 ) $ 194 Twenty-eight weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 8,096 $ 512 $ (84 ) $ 8,524 Cost of goods sold and occupancy costs — 5,318 356 (81 ) 5,593 Gross profit — 2,778 156 (3 ) 2,931 Selling, general and administrative expenses — 2,266 136 — 2,402 Pre-opening expenses — 27 4 — 31 Relocation, store closure and lease termination costs — 5 — — 5 Operating income — 480 16 (3 ) 493 Interest expense (18 ) — — — (18 ) Investment and other income (expense) — 9 (2 ) 2 9 Equity in net income of subsidiaries 310 6 15 (331 ) — Income before income taxes 292 495 29 (332 ) 484 Provision for income taxes (7 ) 187 5 — 185 Net income $ 299 $ 308 $ 24 $ (332 ) $ 299 Consolidated Statements of Comprehensive Income (unaudited) (In millions) Twelve weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 99 $ 103 $ 4 $ (107 ) $ 99 Other comprehensive income (loss), net of tax: Foreign currency translation adjustments — 1 (3 ) — (2 ) Other comprehensive income (loss), net of tax — 1 (3 ) — (2 ) Comprehensive income $ 99 $ 104 $ 1 $ (107 ) $ 97 Twenty-eight weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 194 $ 208 $ 8 $ (216 ) $ 194 Other comprehensive income (loss), net of tax: Foreign currency translation adjustments — (3 ) — — (3 ) Other comprehensive income (loss), net of tax — (3 ) — — (3 ) Comprehensive income $ 194 $ 205 $ 8 $ (216 ) $ 191 Twelve weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 142 $ 144 $ 16 $ (160 ) $ 142 Other comprehensive loss, net of tax: Foreign currency translation adjustments — (4 ) 14 — 10 Other comprehensive loss, net of tax — (4 ) 14 — 10 Comprehensive income $ 142 $ 140 $ 30 $ (160 ) $ 152 Twenty-eight weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 299 $ 308 $ 24 $ (332 ) $ 299 Other comprehensive loss, net of tax: Foreign currency translation adjustments — — — — — Other comprehensive loss, net of tax — — — — — Comprehensive income $ 299 $ 308 $ 24 $ (332 ) $ 299 Condensed Consolidated Statements of Cash Flows (unaudited) (In millions) Twenty-eight weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net cash provided by (used in) operating activities $ (26 ) $ 628 $ 22 $ — $ 624 Cash flows from investing activities Purchases of property, plant and equipment — (351 ) (25 ) — (376 ) Purchases of available-for-sale securities — (356 ) — — (356 ) Sales and maturities of available-for-sale securities — 258 — — 258 Payment for purchase of acquired entities, net of cash acquired — — — — — Intercompany activity 107 — — (107 ) — Other investing activities — (6 ) — — (6 ) Net cash provided by (used in) investing activities 107 (455 ) (25 ) (107 ) (480 ) Cash flows from financing activities Purchases of treasury stock — — — — — Common stock dividends paid (88 ) — — — (88 ) Issuance of common stock 10 — — — 10 Excess tax benefit related to exercise of team member stock options — — — — — Proceeds from long-term borrowings — — — — — Proceed for revolving line of credit — — — — — Payments on long-term debt and capital lease obligations (2 ) — — — (2 ) Intercompany activity — (113 ) 6 107 — Other financing activities (1 ) — — — (1 ) Net cash provided by (used in) financing activities (81 ) (113 ) 6 107 (81 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — — — — Net change in cash, cash equivalents, and restricted cash — 60 3 — 63 Cash, cash equivalents, and restricted cash at beginning of period — 368 105 — 473 Cash, cash equivalents, and restricted cash at end of period $ — $ 428 $ 108 $ — $ 536 Condensed Consolidated Statements of Cash Flows (unaudited) (In millions) Twenty-eight weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net cash provided by (used in) operating activities $ — $ 547 $ 28 $ — $ 575 Cash flows from investing activities Purchases of property, plant and equipment — (302 ) (36 ) — (338 ) Purchases of available-for-sale securities — (176 ) — — (176 ) Sales and maturities of available-for-sale securities — 350 — — 350 Payment for purchase of acquired entities, net of cash acquired — — (11 ) — (11 ) Intercompany activity (174 ) — — 174 — Other investing activities — (10 ) — — (10 ) Net cash used in investing activities (174 ) (138 ) (47 ) 174 (185 ) Cash flows from financing activities Purchases of treasury stock (734 ) — — — (734 ) Common stock dividends paid (90 ) — — — (90 ) Issuance of common stock 11 — — — 11 Excess tax benefit related to exercise of team member stock options 1 — — — 1 Proceeds from long-term borrowings 999 — — — 999 Proceed for revolving line of credit 300 — — — 300 Payments on long-term debt and capital lease obligations (305 ) — — — (305 ) Intercompany activity — 155 19 (174 ) — Other financing activities (8 ) — — — (8 ) Net cash provided by financing activities 174 155 19 (174 ) 174 Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — 2 — 2 Net change in cash, cash equivalents, and restricted cash — 564 2 — 566 Cash, cash equivalents, and restricted cash at beginning of period — 261 103 — 364 Cash, cash equivalents, and restricted cash at end of period $ — $ 825 $ 105 $ — $ 930 |
Subsequent Events Subsequent Ev
Subsequent Events Subsequent Events | 6 Months Ended |
Apr. 09, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | Subsequent Events On May 10, 2017, the Board authorized a new $1.25 billion share repurchase program, with the intent to opportunistically utilize the authorization over the next 18 months. The new authorization will replace the Company’s existing program. |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Apr. 09, 2017 | |
Accounting Policies [Abstract] | |
Fiscal Period, Policy [Policy Text Block] | The Company reports its results of operations on a 52 - or 53 -week fiscal year ending on the last Sunday in September. The first fiscal quarter is 16 weeks, the second and third quarters each are 12 weeks, and the fourth quarter is 12 or 13 weeks. Fiscal years 2017 and 2016 are 52 -week years. |
New Accounting Pronouncements, Policy [Policy Text Block] | The following table provides a brief description of recently issued accounting pronouncements that have not yet been adopted. Early adoption is permitted for all updates unless stated. Standard Description Effective Date Effect on financial statements and other significant matters ASU No. 2017-04 Simplifying the Test for Goodwill Impairment (Topic 350) The amendments eliminate Step 2 from the goodwill impairment test. Instead, an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value should be recognized; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. Income tax effects from any tax deductible goodwill on the carrying amount of the reporting unit when measuring the goodwill impairment loss should also be considered, if applicable. The amendments should be applied on a prospective basis. First quarter of fiscal year ending September 27, 2020 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-13 Measurement of Credit Losses on Financial Instruments(Topic 326) The amendments guide on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities. The amendments require a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. The amendments also require that credit losses on available-for-sale debt securities be presented as an allowance. The amendments should be applied on either a prospective transition or modified-retrospective approach depending on the subtopic. First quarter of fiscal year ending September 29, 2021 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-09 Improvements to Employee Share-Based Payment Accounting (Topic 718) The amendments aim to simplify several aspects of the accounting for share-based payment transactions, including the income tax consequences, forfeitures, and certain classifications on the statement of cash flows. The amendments should be applied on either a prospective, retrospective, or modified-retrospective basis depending on the subtopic. First quarter of fiscal year ending September 30, 2018 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-08 Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (Topic 606) The amendments, which do not change the core principle of the guidance in Topic 606, clarify the implementation guidance on principal versus agent considerations, including how an entity should identify the unit of accounting (i.e., the specified good or service) for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements, such as service transactions. The amendments may be applied on either a full or modified retrospective basis. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-07 Simplifying the Transition to the Equity Method of Accounting (Topic 323) The amendments eliminate the requirement to retroactively apply the equity method of accounting when an investment qualifies for the use of the equity method due to an increase in the level of ownership interest or degree of influence. The amendments should be applied on a prospective basis. First quarter of fiscal year ending September 30, 2018 We do not expect the adoption of these provisions to have a significant impact on the Company’s consolidated financial statements. Standard Description Effective Date Effect on financial statements and other significant matters ASU No. 2016-04 Recognition of Breakage for Certain Prepaid Stored-Value Products (a consensus of the Emerging Issues Task Force) (Subtopic 405-20) The amendments require entities to recognize liabilities related to the sale of prepaid stored-value products redeemable for goods, services or cash as financial liabilities in the scope of ASC 405. Additionally, the new guidance amends ASC 405-20 to include a narrow scope exception requiring entities to recognize breakage for these liabilities in a way that is consistent with how gift card breakage will be recognized under the new revenue recognition standard. The amendments may be applied on either a full or modified retrospective basis. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2016-02 Leases (Topic 842) The amendments require lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement and presentation of expenses will depend on classification as a finance or operating lease. The amendments also require certain quantitative and qualitative disclosures. Accounting guidance for lessors is largely unchanged. The amendments should be applied on a modified retrospective basis. First quarter of fiscal year ending September 27, 2020 The adoption of this ASU will result in a significant increase to the Company’s Consolidated Balance Sheets for lease liabilities and right-of-use assets, and the Company is currently evaluating the other effects of adoption of this ASU on its Consolidated Financial Statements. ASU No. 2016-01 Recognition and Measurement of Financial Assets and Financial Liabilities (Subtopic 825-10) The amendments address certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. The amendments should be applied by means of a cumulative-effect adjustment to the balance sheet in year of adoption. Early adoption is permitted for only certain amendments of the update. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the impact that the adoption of these provisions will have on the Company’s consolidated financial statements. ASU No. 2015-17 Balance Sheet Classification of Deferred Taxes (Topic 740) The amendments simplify the presentation of deferred income taxes by requiring that all deferred tax liabilities and assets be classified as noncurrent in the statement of financial position. The amendments may be applied on either a prospective or retrospective basis. First quarter of fiscal year ending September 30, 2018 We do not expect the adoption of these provisions to have a significant impact on the Company’s consolidated financial statements. ASU No. 2015-11 Simplifying the Measurement of Inventory (Topic 330) The amendments, which apply to inventory that is measured using any method other than the last-in, first-out (LIFO) or retail inventory method, require that entities measure inventory at the lower of cost and net realizable value. The amendments should be applied on a prospective basis. First quarter of fiscal year ending September 30, 2018 We do not expect the adoption of these provisions to have a significant impact on the Company’s consolidated financial statements. ASU No. 2014-09 Revenue from Contracts with Customers (Topic 606) The core principle of the new guidance is that an entity will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Additionally, the guidance requires disclosures related to the nature, amount, timing, and uncertainty of revenue that is recognized. The amendments may be applied on either a full or modified retrospective basis. First quarter of fiscal year ending September 29, 2019 We are currently evaluating the timing, method, and impact that the adoption of these provisions will have on the Company’s consolidated financial statements. |
Earnings Per Share, Policy [Policy Text Block] | The computation of basic earnings per share is based on the number of weighted average common shares outstanding during the period. The computation of diluted earnings per share includes the dilutive effect of common stock equivalents consisting of incremental common shares deemed outstanding from the assumed exercise of stock options and the dilutive effect of restricted stock awards. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Entity Wide Information Geographic Area Revenue [Table Text Block] | The following is a summary of percentage sales by geographic area for the periods indicated: Twelve weeks ended Twenty-eight weeks ended April 9, April 10, April 9, April 10, Sales: United States 97.1 % 97.1 % 97.1 % 97.1 % Canada and United Kingdom 2.9 2.9 2.9 2.9 Total sales 100.0 % 100.0 % 100.0 % 100.0 % |
Schedule of Entity Wide Information Geographic Area Long-Lived Assets [Table Text Block] | The following is a summary of the percentage of net long-lived assets by geographic area as of the dates indicated: April 9, September 25, Long-lived assets, net: United States 97.5 % 97.5 % Canada and United Kingdom 2.5 2.5 Total long-lived assets, net 100.0 % 100.0 % |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis [Table Text Block] | The Company held the following financial assets measured at fair value on a recurring basis based on the hierarchy levels indicated (in millions): April 9, 2017 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Cash equivalents: Money market fund $ 2 $ — $ — $ 2 Marketable securities - available-for-sale: Municipal bonds — 25 — 25 Variable-rate demand notes — 451 — 451 Total $ 2 $ 476 $ — $ 478 September 25, 2016 Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Cash equivalents: Money market fund $ 62 $ — $ — $ 62 Commercial paper — 30 — 30 Municipal bonds — 46 — 46 Marketable securities - available-for-sale: Commercial paper — 30 — 30 Municipal bonds — 26 — 26 Variable rate demand notes — 323 — 323 Total $ 62 $ 455 $ — $ 517 |
Investments (Tables)
Investments (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Investments [Abstract] | |
Marketable Securities [Table Text Block] | The Company held the following investments at fair value as of the dates indicated (in millions): April 9, September 25, Short-term marketable securities - available-for-sale: Commercial paper $ — $ 30 Municipal bonds 25 26 Variable rate demand notes 451 323 Total short-term marketable securities $ 476 $ 379 |
Goodwill and Other Intangible28
Goodwill and Other Intangible Assets (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived And Indefinite-Lived Intangible Assets by Major Class [Table Text Block] | The components of intangible assets as of the dates indicated were as follows (in millions): April 9, 2017 September 25, 2016 Gross carrying amount Accumulated amortization Gross carrying amount Accumulated amortization Definite-lived contract-based $ 118 $ (56 ) $ 120 $ (55 ) Indefinite-lived contract-based 9 9 Total $ 127 $ (56 ) $ 129 $ (55 ) |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Future amortization expense associated with the net carrying amount of definite-lived intangible assets is estimated to be as follows (in millions): Remainder of fiscal year 2017 $ 3 Fiscal year 2018 5 Fiscal year 2019 5 Fiscal year 2020 5 Fiscal year 2021 4 Future fiscal years 40 Total $ 62 |
Reserves for Closed Properties
Reserves for Closed Properties (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost [Table Text Block] | The following table provides a summary of activity in reserves for closed properties during the twenty-eight weeks ended April 9, 2017 and fiscal year ended September 25, 2016 (in millions): April 9, September 25, Beginning balance $ 26 $ 28 Additions 27 6 Usage (5 ) (10 ) Adjustments 1 2 Ending balance $ 49 $ 26 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | The components of long-term debt as of the dates indicated were as follows (in millions): April 9, September 25, 5.2% senior notes due 2025 $ 1,000 $ 1,000 Less: unamortized discount and debt issuance costs related to senior notes (7 ) (7 ) Carrying value of senior notes 993 993 Capital lease obligations 56 58 Total long-term debt and capital lease obligations 1,049 1,051 Less: current installments (2 ) (3 ) Total long-term debt and capital lease obligations, less current installments $ 1,047 $ 1,048 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Equity [Abstract] | |
Dividends Declared [Table Text Block] | The following table provides a summary of dividends declared per common share during fiscal year 2017 to date and fiscal year 2016 (in millions, except per share amounts): Date of declaration Dividend per common share Date of record Date of payment Total amount Fiscal year 2017: November 2, 2016 $ 0.14 January 13, 2017 January 24, 2017 $ 45 February 17, 2017 (1) 0.14 April 7, 2017 April 18, 2017 45 Fiscal year 2016: November 4, 2015 $ 0.135 January 15, 2016 January 26, 2016 $ 44 March 9, 2016 0.135 April 8, 2016 April 19, 2016 44 June 7, 2016 0.135 July 1, 2016 July 12, 2016 43 September 22, 2016 0.135 October 3, 2016 October 14, 2016 43 (1) Dividend accrued at April 9, 2017 |
Schedule of Share Repurchase Programs [Table Text Block] | The following table outlines the share repurchase program authorized by the Board, and the related repurchase activity as of April 9, 2017 (in millions): Effective date Expiration date Amount authorized Cost of repurchases Authorization available November 4, 2015 Not applicable $ 1,000 $ 557 $ 443 |
Schedule of Shares Repurchased [Table Text Block] | Share repurchase activity for the twelve and twenty-eight weeks ended April 9, 2017 was immaterial. Share repurchase activity for the twelve and twenty-eight weeks ended April 10, 2016 was as follows (in millions, except per share amounts): Twelve weeks ended Twenty-eight weeks ended April 10, April 10, Number of common shares acquired 3.5 24.6 Average price per common share acquired $ 28.88 $ 29.81 Total cost of common shares acquired $ 100 $ 734 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | A reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations follows (in millions, except per share amounts): Twelve weeks ended Twenty-eight weeks ended April 9, April 10, April 9, April 10, Net income (numerator for basic and diluted earnings per share) $ 99 $ 142 $ 194 $ 299 Weighted average common shares outstanding (denominator for basic earnings per share) 318.5 324.7 318.3 331.7 Incremental common shares attributable to dilutive effect of share-based awards 0.4 0.7 0.4 1.0 Weighted average common shares outstanding and potential additional common shares outstanding (denominator for diluted earnings per share) 318.9 325.4 318.7 332.7 Basic earnings per share $ 0.31 $ 0.44 $ 0.61 $ 0.90 Diluted earnings per share $ 0.31 $ 0.44 $ 0.61 $ 0.90 |
Guarantor Financial Statements
Guarantor Financial Statements (Tables) | 6 Months Ended |
Apr. 09, 2017 | |
Guarantor Financial Statements [Abstract] | |
Consolidated Statements of Balance Sheets with Guarantor Information [Table Text Block] | Consolidated Balance Sheets (unaudited) (In millions) April 9, 2017 Assets Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Current assets: Cash and cash equivalents $ — $ 310 $ 102 $ — $ 412 Short-term investments - available-for-sale securities — 476 — — 476 Restricted cash — 118 6 — 124 Accounts receivable — 233 22 — 255 Intercompany receivable — 728 — (728 ) — Merchandise inventories — 438 70 — 508 Prepaid expenses and other current assets 1 75 43 — 119 Deferred income taxes — 214 — — 214 Total current assets 1 2,592 243 (728 ) 2,108 Property and equipment, net of accumulated depreciation and amortization — 3,082 387 — 3,469 Investments in consolidated subsidiaries 4,802 107 476 (5,385 ) — Goodwill — 703 7 — 710 Intangible assets, net of accumulated amortization 1 61 9 — 71 Deferred income taxes — 108 6 — 114 Other assets — 13 28 — 41 Total assets $ 4,804 $ 6,666 $ 1,156 $ (6,113 ) $ 6,513 Liabilities and Shareholders’ Equity Current liabilities: Current installments of long-term debt and capital lease obligations $ — $ 2 $ — $ — $ 2 Accounts payable — 224 89 — 313 Intercompany payable 389 — 339 (728 ) — Accrued payroll, bonus and other benefits due team members — 368 25 — 393 Dividends payable 45 — — — 45 Other current liabilities 18 530 36 — 584 Total current liabilities 452 1,124 489 (728 ) 1,337 Long-term debt and capital lease obligations, less current installments 993 46 8 — 1,047 Deferred lease liabilities — 615 50 — 665 Other long-term liabilities — 104 1 — 105 Total liabilities 1,445 1,889 548 (728 ) 3,154 Commitments and contingencies Total shareholders’ equity 3,359 4,777 608 (5,385 ) 3,359 Total liabilities and shareholders’ equity $ 4,804 $ 6,666 $ 1,156 $ (6,113 ) $ 6,513 Consolidated Balance Sheets (unaudited) (In millions) September 25, 2016 Assets Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Current assets: Cash and cash equivalents $ — $ 254 $ 97 $ — $ 351 Short-term investments - available-for-sale securities — 379 — — 379 Restricted cash — 114 8 — 122 Accounts receivable — 216 26 — 242 Intercompany receivable — 649 — (649 ) — Merchandise inventories — 441 76 — 517 Prepaid expenses and other current assets — 150 17 — 167 Deferred income taxes — 197 — — 197 Total current assets — 2,400 224 (649 ) 1,975 Property and equipment, net of accumulated depreciation and amortization — 3,063 379 — 3,442 Investments in consolidated subsidiaries 4,593 103 472 (5,168 ) — Goodwill — 702 8 — 710 Intangible assets, net of accumulated amortization 1 63 10 — 74 Deferred income taxes — 94 6 — 100 Other assets — 16 24 — 40 Total assets $ 4,594 $ 6,441 $ 1,123 $ (5,817 ) $ 6,341 Liabilities and Shareholders’ Equity Current liabilities: Current installments of long-term debt and capital lease obligations $ — $ 3 $ — $ — $ 3 Accounts payable — 227 80 — 307 Intercompany payable 317 — 333 (650 ) — Accrued payroll, bonus and other benefits due team members — 381 26 — 407 Dividends payable 43 — — — 43 Other current liabilities 17 536 28 — 581 Total current liabilities 377 1,147 467 (650 ) 1,341 Long-term debt and capital lease obligations, less current installments 993 48 7 — 1,048 Deferred lease liabilities — 592 48 — 640 Other long-term liabilities — 87 1 — 88 Total liabilities 1,370 1,874 523 (650 ) 3,117 Commitments and contingencies Total shareholders’ equity 3,224 4,567 600 (5,167 ) 3,224 Total liabilities and shareholders’ equity $ 4,594 $ 6,441 $ 1,123 $ (5,817 ) $ 6,341 |
Consolidated Statements of Operations with Guarantor Information [Table Text Block] | Consolidated Statements of Operations (unaudited) (In millions) Twelve weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 3,547 $ 220 $ (30 ) $ 3,737 Cost of goods sold and occupancy costs — 2,332 161 (30 ) 2,463 Gross profit — 1,215 59 — 1,274 Selling, general and administrative expenses — 1,001 56 — 1,057 Pre-opening expenses — 12 — — 12 Relocation, store closure and lease termination costs — 34 — — 34 Operating income — 168 3 — 171 Interest expense (11 ) — — — (11 ) Investment and other expense — — (1 ) 3 2 Equity in net income of subsidiaries 106 1 3 (110 ) — Income before income taxes 95 169 5 (107 ) 162 Provision for income taxes (4 ) 66 1 — 63 Net income $ 99 $ 103 $ 4 $ (107 ) $ 99 Twelve weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 3,512 $ 223 $ (39 ) $ 3,696 Cost of goods sold and occupancy costs — 2,290 155 (39 ) 2,406 Gross profit — 1,222 68 — 1,290 Selling, general and administrative expenses — 971 57 — 1,028 Pre-opening expenses — 17 1 — 18 Relocation, store closure and lease termination costs — 3 — — 3 Operating income — 231 10 — 241 Interest expense (11 ) — — — (11 ) Investment and other expense — 4 — 1 5 Equity in net income of subsidiaries 149 3 9 (161 ) — Income before income taxes 138 238 19 (160 ) 235 Provision for income taxes (4 ) 94 3 — 93 Net income $ 142 $ 144 $ 16 $ (160 ) $ 142 Consolidated Statements of Operations (unaudited) (In millions) Twenty-eight weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 8,219 $ 535 $ (98 ) $ 8,656 Cost of goods sold and occupancy costs — 5,442 386 (96 ) 5,732 Gross profit — 2,777 149 (2 ) 2,924 Selling, general and administrative expenses — 2,338 136 — 2,474 Pre-opening expenses — 30 3 — 33 Relocation, store closure and lease termination costs — 73 1 — 74 Operating income — 336 9 (2 ) 343 Interest expense (26 ) — — — (26 ) Investment and other expense — — (2 ) 3 1 Equity in net income of subsidiaries 210 3 4 (217 ) — Income before income taxes 184 339 11 (216 ) 318 Provision for income taxes (10 ) 131 3 — 124 Net income $ 194 $ 208 $ 8 $ (216 ) $ 194 Twenty-eight weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Sales $ — $ 8,096 $ 512 $ (84 ) $ 8,524 Cost of goods sold and occupancy costs — 5,318 356 (81 ) 5,593 Gross profit — 2,778 156 (3 ) 2,931 Selling, general and administrative expenses — 2,266 136 — 2,402 Pre-opening expenses — 27 4 — 31 Relocation, store closure and lease termination costs — 5 — — 5 Operating income — 480 16 (3 ) 493 Interest expense (18 ) — — — (18 ) Investment and other income (expense) — 9 (2 ) 2 9 Equity in net income of subsidiaries 310 6 15 (331 ) — Income before income taxes 292 495 29 (332 ) 484 Provision for income taxes (7 ) 187 5 — 185 Net income $ 299 $ 308 $ 24 $ (332 ) $ 299 |
Consolidated Statements of Comprehensive Income with Guarantor Information [Table Text Block] | Consolidated Statements of Comprehensive Income (unaudited) (In millions) Twelve weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 99 $ 103 $ 4 $ (107 ) $ 99 Other comprehensive income (loss), net of tax: Foreign currency translation adjustments — 1 (3 ) — (2 ) Other comprehensive income (loss), net of tax — 1 (3 ) — (2 ) Comprehensive income $ 99 $ 104 $ 1 $ (107 ) $ 97 Twenty-eight weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 194 $ 208 $ 8 $ (216 ) $ 194 Other comprehensive income (loss), net of tax: Foreign currency translation adjustments — (3 ) — — (3 ) Other comprehensive income (loss), net of tax — (3 ) — — (3 ) Comprehensive income $ 194 $ 205 $ 8 $ (216 ) $ 191 Twelve weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 142 $ 144 $ 16 $ (160 ) $ 142 Other comprehensive loss, net of tax: Foreign currency translation adjustments — (4 ) 14 — 10 Other comprehensive loss, net of tax — (4 ) 14 — 10 Comprehensive income $ 142 $ 140 $ 30 $ (160 ) $ 152 Twenty-eight weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net income $ 299 $ 308 $ 24 $ (332 ) $ 299 Other comprehensive loss, net of tax: Foreign currency translation adjustments — — — — — Other comprehensive loss, net of tax — — — — — Comprehensive income $ 299 $ 308 $ 24 $ (332 ) $ 299 |
Condensed Consolidated Statements of Cash Flows with Guarantor Information [Table Text Block] | Condensed Consolidated Statements of Cash Flows (unaudited) (In millions) Twenty-eight weeks ended April 9, 2017 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net cash provided by (used in) operating activities $ (26 ) $ 628 $ 22 $ — $ 624 Cash flows from investing activities Purchases of property, plant and equipment — (351 ) (25 ) — (376 ) Purchases of available-for-sale securities — (356 ) — — (356 ) Sales and maturities of available-for-sale securities — 258 — — 258 Payment for purchase of acquired entities, net of cash acquired — — — — — Intercompany activity 107 — — (107 ) — Other investing activities — (6 ) — — (6 ) Net cash provided by (used in) investing activities 107 (455 ) (25 ) (107 ) (480 ) Cash flows from financing activities Purchases of treasury stock — — — — — Common stock dividends paid (88 ) — — — (88 ) Issuance of common stock 10 — — — 10 Excess tax benefit related to exercise of team member stock options — — — — — Proceeds from long-term borrowings — — — — — Proceed for revolving line of credit — — — — — Payments on long-term debt and capital lease obligations (2 ) — — — (2 ) Intercompany activity — (113 ) 6 107 — Other financing activities (1 ) — — — (1 ) Net cash provided by (used in) financing activities (81 ) (113 ) 6 107 (81 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — — — — Net change in cash, cash equivalents, and restricted cash — 60 3 — 63 Cash, cash equivalents, and restricted cash at beginning of period — 368 105 — 473 Cash, cash equivalents, and restricted cash at end of period $ — $ 428 $ 108 $ — $ 536 Condensed Consolidated Statements of Cash Flows (unaudited) (In millions) Twenty-eight weeks ended April 10, 2016 Parent/Issuer Guarantor Subsidiaries Non-guarantor Subsidiaries Eliminations Consolidated Total Net cash provided by (used in) operating activities $ — $ 547 $ 28 $ — $ 575 Cash flows from investing activities Purchases of property, plant and equipment — (302 ) (36 ) — (338 ) Purchases of available-for-sale securities — (176 ) — — (176 ) Sales and maturities of available-for-sale securities — 350 — — 350 Payment for purchase of acquired entities, net of cash acquired — — (11 ) — (11 ) Intercompany activity (174 ) — — 174 — Other investing activities — (10 ) — — (10 ) Net cash used in investing activities (174 ) (138 ) (47 ) 174 (185 ) Cash flows from financing activities Purchases of treasury stock (734 ) — — — (734 ) Common stock dividends paid (90 ) — — — (90 ) Issuance of common stock 11 — — — 11 Excess tax benefit related to exercise of team member stock options 1 — — — 1 Proceeds from long-term borrowings 999 — — — 999 Proceed for revolving line of credit 300 — — — 300 Payments on long-term debt and capital lease obligations (305 ) — — — (305 ) Intercompany activity — 155 19 (174 ) — Other financing activities (8 ) — — — (8 ) Net cash provided by financing activities 174 155 19 (174 ) 174 Effect of exchange rate changes on cash, cash equivalents, and restricted cash — — 2 — 2 Net change in cash, cash equivalents, and restricted cash — 564 2 — 566 Cash, cash equivalents, and restricted cash at beginning of period — 261 103 — 364 Cash, cash equivalents, and restricted cash at end of period $ — $ 825 $ 105 $ — $ 930 |
Basis of Presentation (Percenta
Basis of Presentation (Percentage Sales by Geographic Area) (Details) | 3 Months Ended | 6 Months Ended | ||
Apr. 09, 2017 | Apr. 10, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | |
Percentage sales by geographic area | ||||
Percentage of Total Sales | 100.00% | 100.00% | 100.00% | 100.00% |
United States [Member] | ||||
Percentage sales by geographic area | ||||
Percentage of Total Sales | 97.10% | 97.10% | 97.10% | 97.10% |
Canada and United Kingdom [Member] | ||||
Percentage sales by geographic area | ||||
Percentage of Total Sales | 2.90% | 2.90% | 2.90% | 2.90% |
Basis of Presentation (Percen35
Basis of Presentation (Percentage of Net Long-Lived Assets by Geographic Area) (Details) | Apr. 09, 2017 | Sep. 25, 2016 |
Percentage net long-lived assets by geographic area | ||
Percentage of Total Net Long-Lived Assets | 100.00% | 100.00% |
United States [Member] | ||
Percentage net long-lived assets by geographic area | ||
Percentage of Total Net Long-Lived Assets | 97.50% | 97.50% |
Canada and United Kingdom [Member] | ||
Percentage net long-lived assets by geographic area | ||
Percentage of Total Net Long-Lived Assets | 2.50% | 2.50% |
Basis of Presentation (Narrativ
Basis of Presentation (Narrative) (Details) - Segment | 6 Months Ended | 12 Months Ended |
Apr. 09, 2017 | Sep. 25, 2016 | |
Organization Consolidation and Presentation [Line Items] | ||
Number of Operating Segments | 1 | |
Number of Reportable Segments | 1 | |
Fiscal Year [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 364 days | 364 days |
Fiscal Year [Member] | Minimum [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 364 days | |
Fiscal Year [Member] | Maximum [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 371 days | |
First Quarter [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 112 days | |
Second Quarter [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 84 days | |
Third Quarter [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 84 days | |
Fourth Quarter [Member] | Minimum [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 84 days | |
Fourth Quarter [Member] | Maximum [Member] | ||
Organization Consolidation and Presentation [Line Items] | ||
Fiscal Period Duration | 91 days |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value Hierarchy) (Details) - Fair value, Measurements, Recurring [Member] - USD ($) $ in Millions | Apr. 09, 2017 | Sep. 25, 2016 |
Assets, Fair Value Disclosure [Abstract] | ||
Total | $ 478 | $ 517 |
Level 1 Inputs [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Total | 2 | 62 |
Level 2 Inputs [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Total | 476 | 455 |
Money Market Funds [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash Equivalents, Fair Value Disclosure | 2 | 62 |
Money Market Funds [Member] | Level 1 Inputs [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash Equivalents, Fair Value Disclosure | 2 | 62 |
Commercial Paper [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash Equivalents, Fair Value Disclosure | 30 | |
Marketable Securities - Available-for-sale | 30 | |
Commercial Paper [Member] | Level 2 Inputs [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash Equivalents, Fair Value Disclosure | 30 | |
Marketable Securities - Available-for-sale | 30 | |
Municipal Notes Bonds [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash Equivalents, Fair Value Disclosure | 46 | |
Marketable Securities - Available-for-sale | 25 | 26 |
Municipal Notes Bonds [Member] | Level 2 Inputs [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Cash Equivalents, Fair Value Disclosure | 46 | |
Marketable Securities - Available-for-sale | 25 | 26 |
Variable Rate Demand Obligation [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Marketable Securities - Available-for-sale | 451 | 323 |
Variable Rate Demand Obligation [Member] | Level 2 Inputs [Member] | ||
Assets, Fair Value Disclosure [Abstract] | ||
Marketable Securities - Available-for-sale | $ 451 | $ 323 |
Fair Value Measurements Fair Va
Fair Value Measurements Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 4 Months Ended |
Apr. 09, 2017 | Jan. 15, 2017 | |
Relocation, Store Closure and Lease Termination Cost [Member] | Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impairment of Long-Lived Assets, on a Nonrecurring Basis | $ 34 | $ 34 |
Investments (Investments at Fai
Investments (Investments at Fair Value) (Details) - USD ($) $ in Millions | Apr. 09, 2017 | Sep. 25, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Current | $ 476 | $ 379 |
Commercial Paper [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Current | 30 | |
Municipal Notes [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Current | 25 | 26 |
Variable Rate Demand Obligation [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities, Current | $ 451 | $ 323 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Apr. 09, 2017 | Sep. 25, 2016 | |
Investments [Abstract] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value | $ 0 | $ 33 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value | $ 0 | |
Short-term Investments Average Effective Maturity Period (in months), Less Than and Approximately, Respectively | 1 month | 1 month |
Cost Method Investments | $ 24 | $ 19 |
Goodwill and Other Intangible41
Goodwill and Other Intangible Assets (Components of Intangible Assets) (Details) - USD ($) $ in Millions | Apr. 09, 2017 | Sep. 25, 2016 |
Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Finite and Indefinite-Lived Intangible Assets, Gross | $ 127 | $ 129 |
Finite-Lived Intangible Assets, Accumulated Amortization | (56) | (55) |
Contract-Based Intangible Assets [Member] | ||
Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Finite-Lived Intangible Assets, Gross | 118 | 120 |
Finite-Lived Intangible Assets, Accumulated Amortization | (56) | (55) |
Contract-Based Intangible Assets [Member] | ||
Finite and Indefinite-Lived Intangible Assets [Line Items] | ||
Indefinite-Lived Intangible Assets | $ 9 | $ 9 |
Goodwill and Other Intangible42
Goodwill and Other Intangible Assets (Future Amortization Expense) (Details) $ in Millions | Apr. 09, 2017USD ($) |
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract] | |
Finite-Lived Intangible Assets, Amortization Expense, Remainder of Fiscal Year | $ 3 |
Finite-Lived Intangible Assets, Amortization Expense, Year Two | 5 |
Finite-Lived Intangible Assets, Amortization Expense, Year Three | 5 |
Finite-Lived Intangible Assets, Amortization Expense, Year Four | 5 |
Finite-Lived Intangible Assets, Amortization Expense, Year Five | 4 |
Finite-Lived Intangible Assets, Amortization Expense, after Year Five | 40 |
Finite-Lived Intangible Assets, Future Amortization Expense | $ 62 |
Goodwill and Other Intangible43
Goodwill and Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 6 Months Ended | |
Apr. 09, 2017 | Apr. 10, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Goodwill, Additions | $ 0 | $ 0 |
Goodwill, Adjustments | $ 0 | $ 0 |
Store and Facility Closures (De
Store and Facility Closures (Details) $ in Millions | 3 Months Ended | 4 Months Ended | 6 Months Ended | 12 Months Ended |
Apr. 09, 2017USD ($)Closure | Jan. 15, 2017USD ($) | Apr. 09, 2017USD ($) | Sep. 25, 2016USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||
New Closures, Number | Closure | 9 | |||
New Kitchen Closures, Number | Closure | 3 | |||
Restructuring Charges | $ | $ 30 | $ 27 | $ 6 | |
Relocation, Store Closure and Lease Termination Cost [Member] | Fair Value, Measurements, Nonrecurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Impairment of Long-Lived Assets, on a Nonrecurring Basis | $ | $ 34 | $ 34 |
Reserves for Closed Propertie45
Reserves for Closed Properties (Reserves for Closed Properties) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Apr. 09, 2017 | Apr. 09, 2017 | Sep. 25, 2016 | |
Restructuring Reserve [Roll Forward] | |||
Beginning Balance | $ 26 | $ 28 | |
Additions | $ 30 | 27 | 6 |
Usage | (5) | (10) | |
Adjustments | 1 | 2 | |
Ending Balance | $ 49 | $ 49 | $ 26 |
Long-Term Debt (Schedule of Lon
Long-Term Debt (Schedule of Long-Term Debt) (Details) - USD ($) $ in Millions | Apr. 09, 2017 | Sep. 25, 2016 |
Debt Instrument [Line Items] | ||
Total Long-Term Debt and Capital Lease Obligations | $ 1,049 | $ 1,051 |
Less: Current Installments | (2) | (3) |
Total Long-Term Debt and Capital Lease Obligations, Less Current Installments | 1,047 | 1,048 |
Unsecured Debt [Member] | 5.2% Senior Notes due 2025 [Member] | ||
Debt Instrument [Line Items] | ||
5.2% Senior Notes due 2025 | 1,000 | 1,000 |
Less: Unamortized Discount and Debt Issuance Costs Related to Senior Notes | (7) | (7) |
Carrying Value of Senior Notes | 993 | 993 |
Capital Lease Obligations [Member] | ||
Debt Instrument [Line Items] | ||
Capital Lease Obligations | $ 56 | $ 58 |
Long-Term Debt (Credit Agreemen
Long-Term Debt (Credit Agreement) (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Apr. 09, 2017 | Apr. 09, 2017 | Apr. 10, 2016 | |
Line of Credit Facility [Line Items] | |||
Proceeds from revolving line of credit | $ 0 | $ 300 | |
Repayments of Lines of Credit | $ 300 | ||
Long-term Line of Credit | 0 | $ 0 | |
Unsecured Debt [Member] | Revolving Credit Facility [Member] | |||
Line of Credit Facility [Line Items] | |||
Line of Credit Facility, Maximum Borrowing Capacity | $ 500 | 500 | |
Conditional Additional Borrowing Capacity Under Line of Credit Facility | 250 | ||
Unsecured Debt [Member] | Letter of Credit [Member] | |||
Line of Credit Facility [Line Items] | |||
Conditional Additional Borrowing Capacity Under Line of Credit Facility | $ 250 |
Long-Term Debt (Senior Notes) (
Long-Term Debt (Senior Notes) (Narrative) (Details) - Unsecured Debt [Member] - 5.2% Senior Notes due 2025 [Member] - USD ($) $ in Millions | 6 Months Ended | |
Apr. 09, 2017 | Sep. 25, 2016 | |
Debt Instrument [Line Items] | ||
Debt Instrument, Face Amount | $ 1,000 | $ 1,000 |
Debt Instrument, Interest Rate, Stated Percentage | 5.20% | |
Debt Instrument, Frequency of Interest Payment | semiannually | |
Debt Instrument, Maturity Date | Dec. 3, 2025 | |
Debt Instrument, Interest Rate During Period | 5.28% | |
Fair Value, Debt Instrument, Fair Value Exceeded Carrying Value | $ 72 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) | 3 Months Ended | 4 Months Ended | 6 Months Ended | |
Apr. 09, 2017 | Apr. 10, 2016 | Jan. 15, 2017 | Apr. 10, 2016 | |
Income Tax Disclosure [Abstract] | ||||
Effective Tax Rate, Percent | 39.00% | 39.50% | 39.00% | 38.20% |
Shareholders' Equity (Dividends
Shareholders' Equity (Dividends Declared per Common Share) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 4 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jul. 02, 2017 | Apr. 09, 2017 | Sep. 25, 2016 | Jul. 03, 2016 | Apr. 10, 2016 | Jan. 15, 2017 | Jan. 17, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Dividends Per Common Share [Abstract] | ||||||||||
Dividends Payable, Date Declared | Feb. 17, 2017 | Sep. 22, 2016 | Jun. 7, 2016 | Mar. 9, 2016 | Nov. 2, 2016 | Nov. 4, 2015 | ||||
Dividends declared per common share (in dollars per share) | $ 0.14 | $ 0.135 | $ 0.135 | $ 0.135 | $ 0.14 | $ 0.135 | $ 0.28 | $ 0.27 | $ 0.54 | |
Dividends Payable, Date of Record | Apr. 7, 2017 | Oct. 3, 2016 | Jul. 1, 2016 | Apr. 8, 2016 | Jan. 13, 2017 | Jan. 15, 2016 | ||||
Dividends Payable, Date to be Paid | Apr. 18, 2017 | Oct. 14, 2016 | Jul. 12, 2016 | Apr. 19, 2016 | Jan. 24, 2017 | Jan. 26, 2016 | ||||
Dividends, Common Stock, Cash | $ 45 | $ 43 | $ 43 | $ 44 | $ 45 | $ 44 | $ 89 | $ 174 | ||
Subsequent Event [Member] | ||||||||||
Dividends Per Common Share [Abstract] | ||||||||||
Dividends declared per common share (in dollars per share) | $ 0.1806 |
Shareholders' Equity (Share Rep
Shareholders' Equity (Share Repurchase Programs) (Details) - Nov. 4, 2015 Share Repurchase Program [Member] | Apr. 09, 2017USD ($) |
Stock Repurchase Program, Authorized Amount | $ 1,000,000,000 |
Stock Repurchase Program, Amount Utilized For Repurchases | 557,000,000 |
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 443,000,000 |
Shareholders' Equity (Share R52
Shareholders' Equity (Share Repurchase Activity) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Apr. 10, 2016 | Apr. 10, 2016 | Sep. 25, 2016 | |
Equity [Abstract] | |||
Treasury Stock, Shares, Acquired | 3.5 | 24.6 | |
Treasury Stock Acquired, Average Cost Per Share | $ 28.88 | $ 29.81 | |
Treasury Stock, Value, Acquired, Cost Method | $ 100 | $ 734 | $ 944 |
Shareholders' Equity (Narrative
Shareholders' Equity (Narrative) (Details) - USD ($) $ / shares in Units, shares in Millions | 3 Months Ended | 4 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
Jul. 02, 2017 | Apr. 09, 2017 | Sep. 25, 2016 | Jul. 03, 2016 | Apr. 10, 2016 | Jan. 15, 2017 | Jan. 17, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | May 10, 2017 | |
Treasury Stock [Abstract] | |||||||||||
Treasury Stock Reissued During Period, Shares | 0.6 | 0.5 | |||||||||
Treasury Stock Reissued During Period, Value | $ 21,000,000 | $ 22,000,000 | |||||||||
Treasury Stock, Shares | 58.2 | 58.7 | 58.2 | 58.7 | |||||||
Treasury Stock, Value | $ 2,004,000,000 | $ 2,026,000,000 | $ 2,004,000,000 | $ 2,026,000,000 | |||||||
Dividends declared per common share (in dollars per share) | $ 0.14 | $ 0.135 | $ 0.135 | $ 0.135 | $ 0.14 | $ 0.135 | $ 0.28 | $ 0.27 | $ 0.54 | ||
Nov. 4, 2015 Share Repurchase Program [Member] | |||||||||||
Stock Repurchase Program, Authorized Amount | $ 1,000,000,000 | $ 1,000,000,000 | |||||||||
Subsequent Event [Member] | |||||||||||
Increase in regular quarterly dividend | 29.00% | ||||||||||
Treasury Stock [Abstract] | |||||||||||
Dividends declared per common share (in dollars per share) | $ 0.1806 | ||||||||||
Subsequent Event [Member] | May 10, 2017 Share Repurchase Program [Member] | |||||||||||
Stock Repurchase Program, Authorized Amount | $ 1,250,000,000 |
Earnings per Share (Earnings pe
Earnings per Share (Earnings per Share Reconciliation) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Apr. 09, 2017 | Apr. 10, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Earnings Per Share [Abstract] | |||||
Net Income | $ 99 | $ 142 | $ 194 | $ 299 | $ 507 |
Weighted Average Number of Shares Outstanding, Basic | 318.5 | 324.7 | 318.3 | 331.7 | |
Potential common shares outstanding [Abstract] | |||||
Incremental Common Shares Attributable to Dilutive Effect of Share-based Awards | 0.4 | 0.7 | 0.4 | 1 | |
Weighted Average Number of Shares Outstanding, Diluted | 318.9 | 325.4 | 318.7 | 332.7 | |
Basic earnings per share (in dollars per share) | $ 0.31 | $ 0.44 | $ 0.61 | $ 0.90 | |
Diluted earnings per share (in dollars per share) | $ 0.31 | $ 0.44 | $ 0.61 | $ 0.90 |
Earnings per Share (Narrative)
Earnings per Share (Narrative) (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 09, 2017 | Apr. 10, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | |
Earnings Per Share [Abstract] | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 24 | 20.9 | 24.3 | 19.7 |
Share-Based Payments (Narrative
Share-Based Payments (Narrative) (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Apr. 09, 2017 | Apr. 10, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Allocated Share-based Payment Expense | $ 9 | $ 12 | $ 23 | $ 28 | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 31.2 | 31.2 | 29.8 | ||
Stock Option [Member] | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Not yet Recognized, Stock Options | $ 51 | $ 51 | $ 73 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares | 9.7 | 9.7 | 10.5 | ||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition | 2 years 6 months |
Consolidated Statements of Bala
Consolidated Statements of Balance Sheets with Guarantor Information (Details) - USD ($) $ in Millions | Apr. 09, 2017 | Sep. 25, 2016 | Sep. 27, 2015 |
Current assets: | |||
Cash and cash equivalents | $ 412 | $ 351 | |
Short-term investments - available-for-sale securities | 476 | 379 | |
Restricted cash | 124 | 122 | |
Accounts receivable | 255 | 242 | |
Merchandise inventories | 508 | 517 | |
Prepaid expenses and other current assets | 119 | 167 | |
Deferred income taxes | 214 | 197 | |
Total current assets | 2,108 | 1,975 | |
Property and equipment, net of accumulated depreciation and amortization | 3,469 | 3,442 | |
Goodwill | 710 | 710 | |
Intangible assets, net of accumulated amortization | 71 | 74 | |
Deferred income taxes | 114 | 100 | |
Other assets | 41 | 40 | |
Total assets | 6,513 | 6,341 | |
Current liabilities: | |||
Current installments of long-term debt and capital lease obligations | 2 | 3 | |
Accounts payable | 313 | 307 | |
Accrued payroll, bonus and other benefits due team members | 393 | 407 | |
Dividends payable | 45 | 43 | |
Other current liabilities | 584 | 581 | |
Total current liabilities | 1,337 | 1,341 | |
Long-term debt and capital lease obligations, less current installments | 1,047 | 1,048 | |
Deferred lease liabilities | 665 | 640 | |
Other long-term liabilities | 105 | 88 | |
Total liabilities | 3,154 | 3,117 | |
Commitments and contingencies | |||
Shareholders’ equity: | |||
Total shareholders’ equity | 3,359 | 3,224 | $ 3,769 |
Total liabilities and shareholders’ equity | 6,513 | 6,341 | |
Parent Company [Member] | |||
Current assets: | |||
Prepaid expenses and other current assets | 1 | ||
Total current assets | 1 | ||
Investments in consolidated subsidiaries | 4,802 | 4,593 | |
Intangible assets, net of accumulated amortization | 1 | 1 | |
Total assets | 4,804 | 4,594 | |
Current liabilities: | |||
Intercompany payable | 389 | 317 | |
Dividends payable | 45 | 43 | |
Other current liabilities | 18 | 17 | |
Total current liabilities | 452 | 377 | |
Long-term debt and capital lease obligations, less current installments | 993 | 993 | |
Total liabilities | 1,445 | 1,370 | |
Commitments and contingencies | |||
Shareholders’ equity: | |||
Total shareholders’ equity | 3,359 | 3,224 | |
Total liabilities and shareholders’ equity | 4,804 | 4,594 | |
Guarantor Subsidiaries [Member] | |||
Current assets: | |||
Cash and cash equivalents | 310 | 254 | |
Short-term investments - available-for-sale securities | 476 | 379 | |
Restricted cash | 118 | 114 | |
Accounts receivable | 233 | 216 | |
Intercompany receivable | 728 | 649 | |
Merchandise inventories | 438 | 441 | |
Prepaid expenses and other current assets | 75 | 150 | |
Deferred income taxes | 214 | 197 | |
Total current assets | 2,592 | 2,400 | |
Property and equipment, net of accumulated depreciation and amortization | 3,082 | 3,063 | |
Investments in consolidated subsidiaries | 107 | 103 | |
Goodwill | 703 | 702 | |
Intangible assets, net of accumulated amortization | 61 | 63 | |
Deferred income taxes | 108 | 94 | |
Other assets | 13 | 16 | |
Total assets | 6,666 | 6,441 | |
Current liabilities: | |||
Current installments of long-term debt and capital lease obligations | 2 | 3 | |
Accounts payable | 224 | 227 | |
Accrued payroll, bonus and other benefits due team members | 368 | 381 | |
Other current liabilities | 530 | 536 | |
Total current liabilities | 1,124 | 1,147 | |
Long-term debt and capital lease obligations, less current installments | 46 | 48 | |
Deferred lease liabilities | 615 | 592 | |
Other long-term liabilities | 104 | 87 | |
Total liabilities | 1,889 | 1,874 | |
Commitments and contingencies | |||
Shareholders’ equity: | |||
Total shareholders’ equity | 4,777 | 4,567 | |
Total liabilities and shareholders’ equity | 6,666 | 6,441 | |
Non-Guarantor Subsidiaries [Member] | |||
Current assets: | |||
Cash and cash equivalents | 102 | 97 | |
Restricted cash | 6 | 8 | |
Accounts receivable | 22 | 26 | |
Merchandise inventories | 70 | 76 | |
Prepaid expenses and other current assets | 43 | 17 | |
Total current assets | 243 | 224 | |
Property and equipment, net of accumulated depreciation and amortization | 387 | 379 | |
Investments in consolidated subsidiaries | 476 | 472 | |
Goodwill | 7 | 8 | |
Intangible assets, net of accumulated amortization | 9 | 10 | |
Deferred income taxes | 6 | 6 | |
Other assets | 28 | 24 | |
Total assets | 1,156 | 1,123 | |
Current liabilities: | |||
Accounts payable | 89 | 80 | |
Intercompany payable | 339 | 333 | |
Accrued payroll, bonus and other benefits due team members | 25 | 26 | |
Other current liabilities | 36 | 28 | |
Total current liabilities | 489 | 467 | |
Long-term debt and capital lease obligations, less current installments | 8 | 7 | |
Deferred lease liabilities | 50 | 48 | |
Other long-term liabilities | 1 | 1 | |
Total liabilities | 548 | 523 | |
Commitments and contingencies | |||
Shareholders’ equity: | |||
Total shareholders’ equity | 608 | 600 | |
Total liabilities and shareholders’ equity | 1,156 | 1,123 | |
Eliminations [Member] | |||
Current assets: | |||
Intercompany receivable | (728) | (649) | |
Total current assets | (728) | (649) | |
Investments in consolidated subsidiaries | (5,385) | (5,168) | |
Total assets | (6,113) | (5,817) | |
Current liabilities: | |||
Intercompany payable | (728) | (650) | |
Total current liabilities | (728) | (650) | |
Total liabilities | (728) | (650) | |
Commitments and contingencies | |||
Shareholders’ equity: | |||
Total shareholders’ equity | (5,385) | (5,167) | |
Total liabilities and shareholders’ equity | $ (6,113) | $ (5,817) |
Consolidated Statements of Op58
Consolidated Statements of Operations with Guarantor Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Apr. 09, 2017 | Apr. 10, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Income Statement | |||||
Sales | $ 3,737 | $ 3,696 | $ 8,656 | $ 8,524 | |
Cost of goods sold and occupancy costs | 2,463 | 2,406 | 5,732 | 5,593 | |
Gross profit | 1,274 | 1,290 | 2,924 | 2,931 | |
Selling, general and administrative expenses | 1,057 | 1,028 | 2,474 | 2,402 | |
Pre-opening expenses | 12 | 18 | 33 | 31 | |
Relocation, store closure and lease termination costs | 34 | 3 | 74 | 5 | |
Operating income | 171 | 241 | 343 | 493 | |
Interest expense | (11) | (11) | (26) | (18) | |
Investment and other income (expense) | 2 | 5 | 1 | 9 | |
Income before income taxes | 162 | 235 | 318 | 484 | |
Provision for income taxes | 63 | 93 | 124 | 185 | |
Net income | 99 | 142 | 194 | 299 | $ 507 |
Parent Company [Member] | |||||
Income Statement | |||||
Interest expense | (11) | (11) | 26 | (18) | |
Equity in net income of subsidiaries | 106 | 149 | 210 | 310 | |
Income before income taxes | 95 | 138 | 184 | 292 | |
Provision for income taxes | (4) | (4) | (10) | (7) | |
Net income | 99 | 142 | 194 | 299 | |
Guarantor Subsidiaries [Member] | |||||
Income Statement | |||||
Sales | 3,547 | 3,512 | 8,219 | 8,096 | |
Cost of goods sold and occupancy costs | 2,332 | 2,290 | 5,442 | 5,318 | |
Gross profit | 1,215 | 1,222 | 2,777 | 2,778 | |
Selling, general and administrative expenses | 1,001 | 971 | 2,338 | 2,266 | |
Pre-opening expenses | 12 | 17 | 30 | 27 | |
Relocation, store closure and lease termination costs | 34 | 3 | 73 | 5 | |
Operating income | 168 | 231 | 336 | 480 | |
Investment and other income (expense) | 4 | 9 | |||
Equity in net income of subsidiaries | 1 | 3 | 3 | 6 | |
Income before income taxes | 169 | 238 | 339 | 495 | |
Provision for income taxes | 66 | 94 | 131 | 187 | |
Net income | 103 | 144 | 208 | 308 | |
Non-Guarantor Subsidiaries [Member] | |||||
Income Statement | |||||
Sales | 220 | 223 | 535 | 512 | |
Cost of goods sold and occupancy costs | 161 | 155 | 386 | 356 | |
Gross profit | 59 | 68 | 149 | 156 | |
Selling, general and administrative expenses | 56 | 57 | 136 | 136 | |
Pre-opening expenses | 1 | 3 | 4 | ||
Relocation, store closure and lease termination costs | 1 | ||||
Operating income | 3 | 10 | 9 | 16 | |
Investment and other income (expense) | (1) | (2) | (2) | ||
Equity in net income of subsidiaries | 3 | 9 | 4 | 15 | |
Income before income taxes | 5 | 19 | 11 | 29 | |
Provision for income taxes | 1 | 3 | 3 | 5 | |
Net income | 4 | 16 | 8 | 24 | |
Eliminations [Member] | |||||
Income Statement | |||||
Sales | (30) | (39) | (98) | (84) | |
Cost of goods sold and occupancy costs | (30) | (39) | (96) | (81) | |
Gross profit | (2) | (3) | |||
Operating income | (2) | (3) | |||
Investment and other income (expense) | 3 | 1 | 3 | 2 | |
Equity in net income of subsidiaries | (110) | (161) | (217) | (331) | |
Income before income taxes | (107) | (160) | (216) | (332) | |
Net income | $ (107) | $ (160) | $ (216) | $ (332) |
Consolidated Statements of Co59
Consolidated Statements of Comprehensive Income with Guarantor Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Apr. 09, 2017 | Apr. 10, 2016 | Apr. 09, 2017 | Apr. 10, 2016 | Sep. 25, 2016 | |
Net income | $ 99 | $ 142 | $ 194 | $ 299 | $ 507 |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||
Foreign currency translation adjustments | (2) | 10 | (3) | ||
Other comprehensive income (loss), net of tax | (2) | 10 | (3) | $ (4) | |
Comprehensive income (loss) | 97 | 152 | 191 | 299 | |
Parent Company [Member] | |||||
Net income | 99 | 142 | 194 | 299 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||
Comprehensive income (loss) | 99 | 142 | 194 | 299 | |
Guarantor Subsidiaries [Member] | |||||
Net income | 103 | 144 | 208 | 308 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||
Foreign currency translation adjustments | 1 | (4) | (3) | ||
Other comprehensive income (loss), net of tax | 1 | (4) | (3) | ||
Comprehensive income (loss) | 104 | 140 | 205 | 308 | |
Non-Guarantor Subsidiaries [Member] | |||||
Net income | 4 | 16 | 8 | 24 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||
Foreign currency translation adjustments | (3) | 14 | |||
Other comprehensive income (loss), net of tax | (3) | 14 | |||
Comprehensive income (loss) | 1 | 30 | 8 | 24 | |
Eliminations [Member] | |||||
Net income | (107) | (160) | (216) | (332) | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |||||
Comprehensive income (loss) | $ (107) | $ (160) | $ (216) | $ (332) |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Cash Flows with Guarantor Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Apr. 09, 2017 | Apr. 09, 2017 | Apr. 10, 2016 | |
Net Cash Provided by (Used in) Operating Activities [Abstract] | |||
Net cash provided by (used in) operating activities | $ 624 | $ 575 | |
Net Cash Provided by (Used in) Investing Activities [Abstract] | |||
Purchases of property, plant and equipment | (376) | (338) | |
Purchases of available-for-sale securities | (356) | (176) | |
Sales and maturities of available-for-sale securities | 258 | 350 | |
Payment for purchase of acquired entities, net of cash acquired | (11) | ||
Other investing activities | (6) | (10) | |
Net cash provided by (used in) investing activities | (480) | (185) | |
Net Cash Provided by (Used in) Financing Activities [Abstract] | |||
Purchases of treasury stock | (734) | ||
Common stock dividends paid | (88) | (90) | |
Issuance of common stock | 10 | 11 | |
Excess tax benefit related to exercise of team member stock options | 1 | ||
Proceeds from long-term borrowings | 999 | ||
Proceeds from revolving line of credit | $ 0 | 300 | |
Payments on long-term debt and capital lease obligations | (2) | (305) | |
Other financing activities | (1) | (8) | |
Net cash provided by (used in) financing activities | (81) | 174 | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 2 | ||
Net change in cash, cash equivalents, and restricted cash | 63 | 566 | |
Cash, cash equivalents, and restricted cash at beginning of period | 473 | 364 | |
Cash, cash equivalents, and restricted cash at end of period | 536 | 536 | 930 |
Parent Company [Member] | |||
Net Cash Provided by (Used in) Operating Activities [Abstract] | |||
Net cash provided by (used in) operating activities | (26) | ||
Net Cash Provided by (Used in) Investing Activities [Abstract] | |||
Intercompany activity | 107 | (174) | |
Net cash provided by (used in) investing activities | 107 | (174) | |
Net Cash Provided by (Used in) Financing Activities [Abstract] | |||
Purchases of treasury stock | (734) | ||
Common stock dividends paid | (88) | (90) | |
Issuance of common stock | 10 | 11 | |
Excess tax benefit related to exercise of team member stock options | 1 | ||
Proceeds from long-term borrowings | 999 | ||
Proceeds from revolving line of credit | 300 | ||
Payments on long-term debt and capital lease obligations | (2) | (305) | |
Other financing activities | (1) | (8) | |
Net cash provided by (used in) financing activities | (81) | 174 | |
Guarantor Subsidiaries [Member] | |||
Net Cash Provided by (Used in) Operating Activities [Abstract] | |||
Net cash provided by (used in) operating activities | 628 | 547 | |
Net Cash Provided by (Used in) Investing Activities [Abstract] | |||
Purchases of property, plant and equipment | (351) | (302) | |
Purchases of available-for-sale securities | (356) | (176) | |
Sales and maturities of available-for-sale securities | 258 | 350 | |
Other investing activities | (6) | (10) | |
Net cash provided by (used in) investing activities | (455) | (138) | |
Net Cash Provided by (Used in) Financing Activities [Abstract] | |||
Intercompany activity | (113) | 155 | |
Net cash provided by (used in) financing activities | (113) | 155 | |
Net change in cash, cash equivalents, and restricted cash | 60 | 564 | |
Cash, cash equivalents, and restricted cash at beginning of period | 368 | 261 | |
Cash, cash equivalents, and restricted cash at end of period | 428 | 428 | 825 |
Non-Guarantor Subsidiaries [Member] | |||
Net Cash Provided by (Used in) Operating Activities [Abstract] | |||
Net cash provided by (used in) operating activities | 22 | 28 | |
Net Cash Provided by (Used in) Investing Activities [Abstract] | |||
Purchases of property, plant and equipment | (25) | (36) | |
Payment for purchase of acquired entities, net of cash acquired | (11) | ||
Net cash provided by (used in) investing activities | (25) | (47) | |
Net Cash Provided by (Used in) Financing Activities [Abstract] | |||
Intercompany activity | 6 | 19 | |
Net cash provided by (used in) financing activities | 6 | 19 | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 2 | ||
Net change in cash, cash equivalents, and restricted cash | 3 | 2 | |
Cash, cash equivalents, and restricted cash at beginning of period | 105 | 103 | |
Cash, cash equivalents, and restricted cash at end of period | $ 108 | 108 | 105 |
Eliminations [Member] | |||
Net Cash Provided by (Used in) Investing Activities [Abstract] | |||
Intercompany activity | (107) | 174 | |
Net cash provided by (used in) investing activities | (107) | 174 | |
Net Cash Provided by (Used in) Financing Activities [Abstract] | |||
Intercompany activity | 107 | (174) | |
Net cash provided by (used in) financing activities | $ 107 | $ (174) |
Subsequent Events Subsequent 61
Subsequent Events Subsequent Events (Details) | May 10, 2017USD ($) |
Subsequent Event [Member] | May 10, 2017 Share Repurchase Program [Member] | |
Subsequent Event [Line Items] | |
Stock Repurchase Program, Authorized Amount | $ 1,250,000,000 |