XML 34 R33.htm IDEA: XBRL DOCUMENT v2.4.0.8
Shareholders' Equity (Tables)
 12 Months Ended
Feb. 01, 2014
Shareholders' Equity Disclosure [Abstract]  
Stock-based compensation expense
Stock-based compensation expense was as follows in fiscal 2014, 2013 (11-month) and 2012 ($ in millions):
 
12-Month
 
11-Month
 
12-Month
 
2014
 
2013
 
2012
Stock options
$
25

 
$
43

 
$
76

Share awards
 
 
 
 
 
Market-based
9

 
2

 
—

Time-based
62

 
62

 
33

Employee stock purchase plans
1

 
5

 
11

Total
$
97

 
$
112

 
$
120
Stock option activity
Stock option activity was as follows in fiscal 2014:
 
Stock
Options
 
Weighted-
Average
Exercise Price
per Share
 
Weighted-Average
Remaining
Contractual
Term (in years)
 
Aggregate
Intrinsic Value (in millions)
Outstanding at February 2, 2013
29,983,000

 
$
36.93

 
 
 
 

Granted
2,741,000

 
$
22.53

 
 
 
 

Exercised
(5,169,000
)
 
$
31.21

 
 
 
 

Forfeited/Canceled
(5,454,000
)
 
$
37.36

 
 
 
 

Outstanding at February 1, 2014
22,101,000

 
$
36.38

 
5.4
 
$
16

Vested or expected to vest at February 1, 2014
21,597,000

 
$
36.68

 
5.3
 
$
16

Exercisable at February 1, 2014
16,926,000

 
$
40.11

 
4.4
 
$
5
Assumption used to estimate the fair value of stock option on the date of grant using a lattice model
In fiscal 2014, 2013 (11-month) and 2012, we estimated the fair value of each stock option on the date of grant using a lattice or Black Scholes valuation model (for certain individuals) with the following assumptions:
 
 
12-Month
 
11-Month
 
12-Month
Valuation Assumptions(1)
 
2014
 
2013
 
2012
Risk-free interest rate(2)
 
0.1% – 1.8%

 
0.1% – 2.0%

 
0.1% – 3.6%

Expected dividend yield
 
2.0
%
 
2.2
%
 
2.3
%
Expected stock price volatility(3)
 
46
%
 
44
%
 
37
%
Expected life of stock options (in years)(4)
 
5.9

 
5.9

 
6.2


(1)
Forfeitures are estimated using historical experience and projected employee turnover.
(2)
Based on the U.S. Treasury constant maturity interest rate whose term is consistent with the expected life of our stock options.
(3)
In projecting expected stock price volatility, we consider both the historical volatility of our stock price as well as implied volatilities from exchange-traded options on our stock.
(4)
We estimate the expected life of stock options based upon historical experience.
Summary of the status of nonvested market-based share awards
A summary of the status of our nonvested market-based share awards at February 1, 2014, and changes during fiscal 2014, is as follows:
Market-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at February 2, 2013
 
805,000

 
$
16.76

Granted
 
1,044,000

 
$
24.26

Vested
 
(20,000
)
 
$
19.89

Forfeited/Canceled
 
(193,000
)
 
$
21.82

Outstanding at February 1, 2014
 
1,636,000

 
$
20.91
Summary of the status of nonvested time-based share awards
A summary of the status of our nonvested time-based share awards at February 1, 2014, and changes during fiscal 2014, is as follows:
Time-Based Share Awards
 
Shares
 
Weighted-Average Fair Value per Share
Outstanding at February 2, 2013
 
7,751,000

 
$
21.05

Granted
 
3,433,000

 
$
22.99

Vested
 
(2,642,000
)
 
$
22.06

Forfeited/Canceled
 
(1,477,000
)
 
$
21.61

Outstanding at February 1, 2014
 
7,065,000

 
$
21.49
Assumptions used to estimate the fair value of stock-based compensation expense associated with employee stock purchase plans on the purchase date using the Black-Scholes option-pricing valuation model

Summary of stock options outstanding
At February 1, 2014, options to purchase 22.1 million shares of common stock were outstanding as follows (shares in millions):
 
Exercisable
 
Unexercisable
 
Total
 
Shares
 
%
 
Weighted-
Average Price
per Share
 
Shares
 
%
 
Weighted-
Average Price
per Share
 
Shares
 
%
 
Weighted-
Average Price
per Share
In-the-money
2.6

 
15
%
 
$
23.84

 
4.3

 
83
%
 
$
21.45

 
6.9

 
31
%
 
$
22.36

Out-of-the-money
14.3

 
85
%
 
$
43.14

 
0.9

 
17
%
 
$
36.91

 
15.2

 
69
%
 
$
42.77

Total
16.9

 
100
%
 
$
40.11

 
5.2

 
100
%
 
$
24.16

 
22.1

 
100
%
 
$
36.38
Reconciliation of the numerators and denominators of basic and diluted earnings per share
The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings per share in fiscal 2014, 2013 (11-month) and 2012:
 
12-Month
 
11-Month
 
12-Month
 
2014
 
2013(1)
 
2012
Numerator (in millions):
 
 
 
 
 
Net earnings (loss) from continuing operations
$
689

 
$
(467
)
 
$
1,424

Net earnings from continuing operations attributable to noncontrolling interests
(2
)
 
(2
)
 
(3
)
Net earnings (loss) from continuing operations attributable to Best Buy Co., Inc., shareholders, basic
687

 
(469
)
 
1,421

Adjustment for assumed dilution:
 
 
 
 
 
Interest on convertible debentures due in 2022, net of tax
—

 
—

 
5

Net earnings (loss) from continuing operations attributable to Best Buy Co., Inc., shareholders, diluted
$
687

 
$
(469
)
 
$
1,426

Denominator (in millions):
 
 
 
 
 
Weighted-average common shares outstanding
342.1

 
338.6

 
366.3

Effect of potentially dilutive securities:
 
 
 
 
 
Shares from assumed conversion of convertible debentures
—

 
—

 
7.6

Stock options and other
5.5

 
—

 
0.6

Weighted-average common shares outstanding, assuming dilution
347.6

 
338.6

 
374.5

Net earnings (loss) per share from continuing operations attributable to Best Buy Co., Inc. shareholders
 
 
 
 
 
Basic
$
2.01

 
$
(1.38
)
 
$
3.88

Diluted
$
1.98

 
$
(1.38
)
 
$
3.81

(1)
The calculation of diluted loss per share for fiscal 2013 (11-month) does not include potentially dilutive securities because their inclusion would be anti-dilutive (i.e., reduce the net loss per share).
Repurchases of common stock
The following table presents the amount and cost of shares we repurchased and retired in fiscal 2014, 2013 (11-month) and 2012 under the June 2011 program and the June 2007 program ($ and shares in millions):
 
12-Month
 
11-Month
 
12-Month
 
2014
 
2013
 
2012
June 2011 Program
 
 
 
 
 
Total number of shares repurchased
—

 
6.3

 
34.5

Total cost of shares repurchased
$
—

 
$
122

 
$
889

June 2007 Program
 
 
 
 
 
Total number of shares repurchased
—

 
—

 
20.1

Total cost of shares repurchased
$
—

 
$
—

 
$
611
Components of accumulated other comprehensive income, net of tax
The following table provides a reconciliation of the components of accumulated other comprehensive income, net of tax, attributable to Best Buy Co., Inc. shareholders for fiscal 2014, 2013 (11-month) and 2012, respectively ($ in millions):
 
Foreign Currency Translation
 
Available-For-Sale Investments
 
Total
Balances at February 26, 2011
$
102

 
$
71

 
$
173

Foreign currency translation adjustments
(9
)
 
—

 
(9
)
Unrealized losses on available-for-sale investments
—

 
(26
)
 
(26
)
Reclassification of gains on available-for-sale investments into earnings
—

 
(48
)
 
(48
)
Balances at March 3, 2012
93

 
(3
)
 
90

Adjustment for fiscal year-end change
11

 
—

 
11

Balances at January 28, 2012
104

 
(3
)
 
101

Foreign currency translation adjustments
9

 
—

 
9

Unrealized gains on available-for-sale investments
—

 
2

 
2

Balances at February 2, 2013
113

 
(1
)
 
112

Foreign currency translation adjustments
(136
)
 
—

 
(136
)
Unrealized gains on available-for-sale investments
—

 
7

 
7

Reclassification of foreign currency translation adjustments into earnings due to sale of business
508

 
—

 
508

Reclassification of losses on available-for-sale investments into earnings
—

 
1

 
1

Balances at February 1, 2014
$
485

 
$
7

 
$
492