XML 22 R10.htm IDEA: XBRL DOCUMENT
v3.7.0.1

Fair Value Measurements | 9 Months Ended
--- | ---
Jul. 02, 2017
Fair Value Disclosures [Abstract] |
Fair Value Measurements | Fair Value Measurements Assets and Liabilities Measured at Fair Value on a Recurring Basis (in millions):
|  |  | Fair Value Measurements at Reporting Date Using
| Balance at Jul 2, 2017 |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
Assets: |  |  |  |  |  |  |
Cash and cash equivalents | $ | 2,716.2 |  |  | $ | 2,716.2 |  |  | $ | — |  |  | $ | — |
Short-term investments: |  |  |  |  |  |  |
Available-for-sale securities |  |  |  |  |  |  |
Agency obligations | 3.3 |  |  | — |  |  | 3.3 |  |  | — |
Commercial paper | 14.9 |  |  | — |  |  | 14.9 |  |  | — |
Corporate debt securities | 71.7 |  |  | — |  |  | 71.7 |  |  | — |
Foreign government obligations | 5.1 |  |  | — |  |  | 5.1 |  |  | — |
U.S. government treasury securities | 97.0 |  |  | 97.0 |  |  | — |  |  | — |
Mortgage and other asset-backed securities | 12.1 |  |  | — |  |  | 12.1 |  |  | — |
Certificates of deposit | 12.3 |  |  | — |  |  | 12.3 |  |  | — |
Total available-for-sale securities | 216.4 |  |  | 97.0 |  |  | 119.4 |  |  | — |
Trading securities | 73.5 |  |  | 73.5 |  |  | — |  |  | — |
Total short-term investments | 289.9 |  |  | 170.5 |  |  | 119.4 |  |  | — |
Prepaid expenses and other current assets: |  |  |  |  |  |  |
Derivative assets | 20.9 |  |  | — |  |  | 20.9 |  |  | — |
Long-term investments: |  |  |  |  |  |  |
Available-for-sale securities |  |  |  |  |  |  |
Agency obligations | 28.2 |  |  | — |  |  | 28.2 |  |  | — |
Corporate debt securities | 284.6 |  |  | — |  |  | 284.6 |  |  | — |
Auction rate securities | 5.8 |  |  | — |  |  | — |  |  | 5.8 |
Foreign government obligations | 37.7 |  |  | — |  |  | 37.7 |  |  | — |
U.S. government treasury securities | 151.3 |  |  | 151.3 |  |  | — |  |  | — |
State and local government obligations | 7.4 |  |  | — |  |  | 7.4 |  |  | — |
Mortgage and other asset-backed securities | 193.3 |  |  | — |  |  | 193.3 |  |  | — |
Total long-term investments | 708.3 |  |  | 151.3 |  |  | 551.2 |  |  | 5.8 |
Other long-term assets: |  |  |  |  |  |  |
Derivative assets | 26.2 |  |  | — |  |  | 26.2 |  |  | — |
Total assets | $ | 3,761.5 |  |  | $ | 3,038.0 |  |  | $ | 717.7 |  |  | $ | 5.8 |
Liabilities: |  |  |  |  |  |  |
Accrued liabilities: |  |  |  |  |  |  |
Derivative liabilities | $ | 20.7 |  |  | $ | 6.8 |  |  | $ | 13.9 |  |  | $ | — |
Other long-term liabilities: |  |  |  |  |  |  |
Derivative liabilities | 19.9 |  |  | — |  |  | 19.9 |  |  | — |
Total liabilities | $ | 40.6 |  |  | $ | 6.8 |  |  | $ | 33.8 |  |  | $ | — |
|  |  | Fair Value Measurements at Reporting Date Using
| Balance at Oct 2, 2016 |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
Assets: |  |  |  |  |  |  |
Cash and cash equivalents | $ | 2,128.8 |  |  | $ | 2,128.8 |  |  | $ | — |  |  | $ | — |
Short-term investments: |  |  |  |  |  |  |
Available-for-sale securities |  |  |  |  |  |  |
Agency obligations | 1.3 |  |  | — |  |  | 1.3 |  |  | — |
Commercial paper | 2.6 |  |  | — |  |  | 2.6 |  |  | — |
Corporate debt securities | 34.2 |  |  | — |  |  | 34.2 |  |  | — |
Foreign government obligations | 5.5 |  |  | — |  |  | 5.5 |  |  | — |
U.S. government treasury securities | 15.8 |  |  | 15.8 |  |  | — |  |  | — |
State and local government obligations | 0.5 |  |  | — |  |  | 0.5 |  |  | — |
Certificates of deposit | 5.8 |  |  | — |  |  | 5.8 |  |  | — |
Total available-for-sale securities | 65.7 |  |  | 15.8 |  |  | 49.9 |  |  | — |
Trading securities | 68.7 |  |  | 68.7 |  |  | — |  |  | — |
Total short-term investments | 134.4 |  |  | 84.5 |  |  | 49.9 |  |  | — |
Prepaid expenses and other current assets: |  |  |  |  |  |  |
Derivative assets | 27.7 |  |  | 3.1 |  |  | 24.6 |  |  | — |
Long-term investments: |  |  |  |  |  |  |
Available-for-sale securities |  |  |  |  |  |  |
Agency obligations | 44.4 |  |  | — |  |  | 44.4 |  |  | — |
Corporate debt securities | 459.3 |  |  | — |  |  | 459.3 |  |  | — |
Auction rate securities | 5.7 |  |  | — |  |  | — |  |  | 5.7 |
Foreign government obligations | 46.7 |  |  | — |  |  | 46.7 |  |  | — |
U.S. government treasury securities | 358.2 |  |  | 358.2 |  |  | — |  |  | — |
State and local government obligations | 57.5 |  |  | — |  |  | 57.5 |  |  | — |
Mortgage and other asset-backed securities | 169.9 |  |  | — |  |  | 169.9 |  |  | — |
Total long-term investments | 1,141.7 |  |  | 358.2 |  |  | 777.8 |  |  | 5.7 |
Other long-term assets: |  |  |  |  |  |  |
Derivative assets | 6.4 |  |  | — |  |  | 6.4 |  |  | — |
Total assets | $ | 3,439.0 |  |  | $ | 2,574.6 |  |  | $ | 858.7 |  |  | $ | 5.7 |
Liabilities: |  |  |  |  |  |  |
Accrued liabilities: |  |  |  |  |  |  |
Derivative liabilities | $ | 18.0 |  |  | $ | 1.7 |  |  | $ | 16.3 |  |  | $ | — |
Other long-term liabilities: |  |  |  |  |  |  |
Derivative liabilities | 71.6 |  |  | — |  |  | 71.6 |  |  | — |
Total | $ | 89.6 |  |  | $ | 1.7 |  |  | $ | 87.9 |  |  | $ | — |
There were no transfers between levels, and there was no significant activity within Level 3 instruments during the periods presented. The fair values of any financial instruments presented above exclude the impact of netting assets and liabilities when a legally enforceable master netting agreement exists. Gross unrealized holding gains and losses on investments were not material as of July 2, 2017 and October 2, 2016. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis Assets and liabilities recognized or disclosed at fair value on the condensed consolidated financial statements on a nonrecurring basis include items such as property, plant and equipment, goodwill and other intangible assets, equity and cost method investments, and other assets. These assets are measured at fair value if determined to be impaired. During the third quarter of fiscal 2017, management finalized its long-term strategy for the Teavana reporting unit. The plan emphasizes sales of premium Teavana® tea products at Starbucks branded stores and, to a lesser extent, consumer product channels. The existing portfolio of Teavana-branded retail stores are expected to be closed over the next several quarters. This change in strategic direction triggered an impairment test first of the retail store assets and then an impairment test of the goodwill asset, which also coincided with our annual goodwill testing process. The retail store assets were determined to be fully impaired, which resulted in a charge of $33.0 million. For goodwill, we utilized a combination of income and market approaches to determine the implied fair value of the reporting unit. These approaches used primarily unobservable inputs, including discount, sales growth and royalty rates and valuation multiples of a selection of similar publicly traded companies, which are considered Level 3 fair value measurements. We then compared the implied fair value with the carrying value and recognized a goodwill impairment charge of $69.3 million, thus reducing goodwill of the Teavana reporting unit to $398.3 million as of July 2, 2017. The remaining intangible assets for the Teavana reporting unit of $117.2 million, consisting primarily of the indefinite-lived tradename and definite-lived tea recipes, were also tested, and no impairment losses were recorded. The ongoing impact of the macro economic challenges we have experienced in our EMEA company-owned markets and the continued strength of the Swiss franc, when compared to the relatively inexpensive euro in surrounding countries, have posed strong headwinds to our Switzerland retail reporting unit. Our latest mitigation efforts incorporated into our Level 3 fair value calculation for our Switzerland retail business are not expected to fully recover the reporting unit’s carrying value given the sustained nature of these and other external factors on consumer behavior and tourism. As a result, we have recorded a goodwill impairment charge of $17.9 million, and, as of July 2, 2017, we had approximately $37.0 million of goodwill remaining on our condensed consolidated balance sheet associated with this reporting unit. The estimated fair value of our long-term debt based on the quoted market price (Level 2) is included at Note 7, Debt. Other than the aforementioned fair value adjustments, there were no other material fair value adjustments during the quarter and three quarters ended July 2, 2017 and June 26, 2016.

X
- References No definition available. + Details
Name: | us-gaap_FairValueDisclosuresAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -URI http://asc.fasb.org/topic&trid=2155941 + Details
Name: | us-gaap_FairValueDisclosuresTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration