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Restructuring | 9 Months Ended
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Oct. 30, 2021
Restructuring [Abstract] |
Restructuring | 2. Restructuring Restructuring charges were as follows ($ in millions): Three Months Ended Nine Months Ended October 30, 2021 October 31, 2020 October 30, 2021 October 31, 2020Mexico Exit and Strategic Realignment(1) $ (1) $ 148 $ (45) $ 148 Fiscal 2020 U.S. Retail Operating Model Changes - (1) - - Total $ (1) $ 147 $ (45) $ 148 (1)Includes inventory markdowns recorded in Cost of sales on our Condensed Consolidated Statements of Earnings of ($6) million for the nine months ended October 30, 2021, and $36 million for the three and nine months ended October 31, 2020. Mexico Exit and Strategic Realignment In March 2020 the World Health Organization declared the outbreak of novel coronavirus disease (“COVID-19”) as a pandemic. The COVID-19 pandemic has had significant impacts on, for example, the economic conditions of the markets in which we operate, customer shopping behaviors, the role of technology in peoples’ lives and the way we meet their needs. In light of these changes, we are adapting our Building the New Blue Strategy to ensure that our focus and resources are closely aligned with the opportunities we see in front of us. As a result, in the third quarter of fiscal 2021, we made the decision to exit our operations in Mexico and began taking other actions to more broadly align our organizational structure in support of our strategy. Charges incurred in our International segment primarily related to our decision to exit our operations in Mexico. All remaining stores in Mexico were closed in the first quarter of fiscal 2022 and we do not expect to incur material future restructuring charges related to the exit. Charges incurred in our Domestic segment primarily related to actions taken to align our organizational structure in support of our strategy. During the nine months ended October 30, 2021, we recorded a $44 million credit primarily due to a reduction in expected termination benefits resulting from adjustments to previously planned organizational changes and higher-than-expected employee retention. As we continue to evolve our Building the New Blue Strategy, it is possible that we will incur material future restructuring costs, but we are unable to forecast the timing and magnitude of such costs. All charges incurred related to the exit from Mexico and strategic realignment described above were from continuing operations and were presented as follows ($ in millions): Statement ofThree Months Ended October 30, 2021 Nine Months Ended October 30, 2021 Earnings LocationDomestic International Total Domestic International TotalInventory markdownsCost of sales$ - $ - $ - $ - $ (6) $ (6) Asset impairmentsRestructuring charges - (1) (1) - 6 6 Termination benefitsRestructuring charges - - - (44) (1) (45) $ - $ (1) $ (1) $ (44) $ (1) $ (45) Statement ofThree and Nine Months Ended October 31, 2020 Earnings LocationDomestic International TotalInventory markdownsCost of sales$ - $ 36 $ 36 Asset impairmentsRestructuring charges 10 48 58 Termination benefitsRestructuring charges 36 18 54 $ 46 $ 102 $ 148 Statement ofCumulative Amount as of October 30, 2021 Earnings LocationDomestic International TotalInventory markdownsCost of sales$ - $ 17 $ 17 Asset impairments(1)Restructuring charges 10 63 73 Termination benefitsRestructuring charges 79 19 98 Currency translation adjustmentRestructuring charges - 39 39 Other(2)Restructuring charges - 5 5 $ 89 $ 143 $ 232 (1)Remaining net carrying value approximates fair value and was immaterial as of October 30, 2021.(2)Other charges are primarily comprised of contract termination costs. Restructuring accrual activity related to the exit from Mexico and strategic realignment described above was as follows ($ in millions): Termination Benefits Domestic International TotalBalances at February 1, 2020$ - $ - $ - Charges 36 18 54 Cash payments (7) - (7) Balances at October 31, 2020$ 29 $ 18 $ 47 Balances at January 30, 2021$ 104 $ 20 $ 124 Cash payments (54) (17) (71) Adjustments(1) (44) (1) (45) Changes in foreign currency exchange rates - (1) (1) Balances at October 30, 2021$ 6 $ 1 $ 7 (1)Represents adjustments to previously planned organizational changes in our Domestic segment and higher-than-expected employee retention in both our Domestic and International segments. Fiscal 2020 U.S. Retail Operating Model Changes In the second quarter of fiscal 2020, we made changes primarily related to our U.S. retail operating model to increase organization effectiveness and create a more seamless customer experience across all channels. All charges incurred were related to termination benefits within our Domestic segment and were presented within Restructuring charges from continuing operations on our Condensed Consolidated Statements of Earnings. As of October 30, 2021, the cumulative amount of charges incurred was $41 million and no material liability remains.

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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4(e)) -URI http://asc.fasb.org/extlink&oid=115931487&loc=d3e140904-122747 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -URI http://asc.fasb.org/topic&trid=2175745 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (b)(2) -URI http://asc.fasb.org/extlink&oid=6394359&loc=d3e17939-110869 + Details
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