10-Q

s

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: July 30, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number: 1-10299

(Exact name of registrant as specified in its charter)

New York	13-3513936
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

330 West 34^th Street, New York, New York 10001

(Address of principal executive offices, Zip Code)

(212-720-3700)

(Registrant’s telephone number, including area code)

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01	FL	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ◻

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒	Accelerated filer ◻	Non-accelerated filer  ◻	Smaller reporting company ◻
Emerging growth company ◻

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ◻

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ◻ No ☒

Number of shares of Common Stock outstanding as of August 26, 2022: 93,301,646

TABLE OF CONTENTS

			Page
PART I	FINANCIAL INFORMATION		1
	Item 1.	Financial Statements (Unaudited)	1
		Condensed Consolidated Balance Sheets (Unaudited)	1
		Condensed Consolidated Statements of Operations (Unaudited)	2
		Condensed Consolidated Statements of Comprehensive Income (Unaudited)	3
		Condensed Consolidated Statements of Changes in Shareholders’ Equity (Unaudited)	4
		Condensed Consolidated Statements of Cash Flows (Unaudited)	5
		Notes to the Unaudited Condensed Consolidated Financial Statements (Unaudited)	6
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
	Item 4.	Controls and Procedures	30
PART II	OTHER INFORMATION		31
	Item 1.	Legal Proceedings	31
	Item 1A.	Risk Factors	31
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	31
	Item 6.	Exhibits	32
SIGNATURE			33

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q includes “forward-looking” statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words such as “believes,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “seeks,” “continues,” “feels,” “forecasts,” or words of similar meaning, or future or conditional verbs, such as “will,” “should,” “could,” “may,” “aims,” “intends,” or “projects.” Statements may be forward looking even in the absence of these particular words.

Examples of forward-looking statements include, but are not limited to, statements regarding our financial position, business strategy, and other plans and objectives for our future operations, and generation of free cash flow. These forward-looking statements are based on our current expectations and beliefs concerning future developments and their potential effect on us. The forward-looking statements contained herein are largely based on our expectations for the future, which reflect certain estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions, operating trends, and other factors. Although we believe such estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. As such, management’s assumptions about future events may prove to be inaccurate.

We do not intend to publicly update or revise any forward-looking statements as a result of new information, future events, changes in circumstances, or otherwise. These cautionary statements qualify all forward-looking statements attributable to us, or persons acting on our behalf. Management cautions you that the forward-looking statements contained herein are not guarantees of future performance, and we cannot assure you that such statements will be realized or that the events and circumstances they describe will occur. Factors that could cause actual results to differ materially from those anticipated or implied in the forward-looking statements herein include, but are not limited to, a change in the relationship with any of our key suppliers, including the unavailability of premium products at competitive prices, volume discounts, cooperative advertising, markdown allowances, or ability to cancel orders and return merchandise; our ability to fund our planned capital investments; volatility in the financial markets or other global economic factors; difficulties in appropriately allocating capital and resources among our strategic opportunities; our ability to realize the expected benefits from acquisitions; business opportunities and expansion; investments; expenses; dividends; share repurchases; liquidity; cash flow from operations; use of cash and cash requirements; borrowing capacity; repatriation of cash to the United States; supply chain issues, including delays in merchandise receipts and increasing cost pressure caused by higher oceanic shipping and freight costs; labor shortages; expectations regarding increased wages; inflation; consumer spending levels; the effect of governmental assistance programs; social unrest; continuing risks relating to the effects of the COVID-19 pandemic, including vaccines and safety protocols; expectations regarding increasing global taxes; the effect of increased government regulation and changes in law; the effect of the adverse outcome of any material litigation against us or judicial decisions that affect us or our industry generally; the effects of weather; climate change; ESG risks; increased competition; geopolitical events; the financial effect of accounting regulations and critical accounting policies; credit risk relating to the risk of loss as a result of non-performance by our counterparties; and any other factors set forth in the section entitled “Risk Factors” of our most recent Annual Report on Form 10-K.

All written and oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary statement. A forward-looking statement is neither a prediction nor a guarantee of future events or circumstances, and those future events or circumstances may not occur. You should not place undue reliance on forward-looking statements, which speak to our views only as of the date of this filing. Additional risks and uncertainties that we do not presently know about or that we currently consider to be insignificant may also affect our business operations and financial performance. The Company does not undertake to update any particular forward-looking statement included in this document. See “Risk Factors” included in the Annual Report for a discussion of certain risks relating to our business and any investment in our securities. We are including this cautionary note to make applicable, and take advantage of, the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for forward-looking statements.

Please refer to “Item 1A. Risk Factors” of our most recent Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission. Given these risks and uncertainties, you should not rely on forward-looking statements as predictions of actual results. Any or all of the forward-looking statements contained in this report, or any other public statement made by us, including by our management, may turn out to be incorrect. We are including this cautionary note to make applicable and take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for forward-looking statements. We expressly disclaim any obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	July 30,		July 31,		January 29,
($ in millions, except share amounts)	2022		2021		2022*
ASSETS
Current assets:
Cash and cash equivalents	$	386	$	1,845	$	804
Merchandise inventories		1,644		1,081		1,266
Other current assets		285		252		293
		2,315		3,178		2,363
Property and equipment, net		899		743		917
Operating lease right-of-use assets		2,526		2,569		2,616
Deferred taxes		74		108		86
Goodwill		773		158		797
Other intangible assets, net		432		16		454
Minority investments		736		728		781
Other assets		113		85		121
	$	7,868	$	7,585	$	8,135
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	596	$	539	$	596
Accrued and other liabilities		435		474		561
Current portion of debt and obligations under finance leases		6		102		6
Current portion of lease obligations		548		566		572
		1,585		1,681		1,735
Long-term debt and obligations under finance leases		449		10		451
Long-term lease obligations		2,287		2,363		2,363
Other liabilities		330		190		343
Total liabilities		4,651		4,244		4,892
Commitments and contingencies
Shareholders’ equity:
Common stock and paid-in capital: 99,319,014; 104,515,702; and 99,070,796 shares issued, respectively		788		799		770
Retained earnings		3,051		2,916		2,900
Accumulated other comprehensive loss		(416)		(338)		(343)
Less: Treasury stock at cost: 6,018,197; 714,490; and 2,050,000 shares, respectively		(213)		(41)		(88)
Noncontrolling interest		7		5		4
Total shareholders' equity		3,217		3,341		3,243
	$	7,868	$	7,585	$	8,135

* The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

Second Quarter 2022 Form 10-Q Page 1

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions, except per share amounts)	2022		2021		2022		2021
Sales	$	2,065	$	2,275	$	4,240	$	4,428
Cost of sales		1,411	$	1,477		2,846		2,881
Selling, general and administrative expenses		452	$	450		915		868
Depreciation and amortization		51	$	48		105		93
Impairment and other charges		12	$	36		18		40
Income from operations		139		264		356		546
Interest expense, net		(5)	$	(2)		(10)		(4)
Other income / (expense), net		9	$	325		(13)		329
Income before income taxes		143		587		333		871
Income tax expense		49	$	157		107		239
Net income		94		430		226		632
Net loss attributable to noncontrolling interests		—		—		1		—
Net income attributable to Foot Locker, Inc.	$	94	$	430	$	227	$	632
Basic earnings per share	$	1.00	$	4.14	$	2.39	$	6.10
Weighted-average shares outstanding		94.1		103.8		95.1		103.7
Diluted earnings per share	$	0.99	$	4.09	$	2.36	$	6.02
Weighted-average shares outstanding, assuming dilution		95.1		105.2		96.1		105.1

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

Second Quarter 2022 Form 10-Q Page 2

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

		Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Net income attributable to Foot Locker, Inc.	$	94	$	430	$	227	$	632
Other comprehensive income (loss), net of income tax
Foreign currency translation adjustment:
Translation adjustment arising during the period, net of income tax (benefit)/expense of $-, $-, $(1) and $1, respectively		(31)		(14)		(75)		(10)
Hedges contracts:
Change in fair value of derivatives, net of income tax benefit of $-, $-, $-, and $-, respectively		(3)		—		(2)		—
Pension and postretirement adjustments:
Amortization of net actuarial gain/loss and prior service cost included in net periodic benefit costs, net of income tax expense of $-, $-, $1 and $1, respectively		2		2		4		3
Comprehensive income	$	62	$	418	$	154	$	625

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

Second Quarter 2022 Form 10-Q Page 3

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)

	Additional Paid-In								Accumulated
	Capital &								Other				Total
Thirteen weeks ended	Common Stock			Treasury Stock			Retained		Comprehensive		Noncontrolling		Shareholders'
(shares in thousands, amounts in millions)	Shares	Amount		Shares	Amount		Earnings		Loss		interests		Equity
Balance at April 30, 2022	99,233	$	779	(4,732)	$	(178)	$	2,995	$	(384)	$	3	$	3,215
Restricted stock issued	23													—
Issued under director and stock plans	63		2											2
Share-based compensation expense			9											9
Shares of common stock used to satisfy tax withholding obligations				(6)										—
Share repurchases				(1,400)		(40)								(40)
Reissued for Employee Stock Purchase Plan ("ESPP")			(2)	120		5								3
Noncontrolling interest capital contribution												4		4
Net income								94						94
Cash dividends on common stock ($0.40 per share)								(38)						(38)
Translation adjustment, net of tax										(31)				(31)
Change in hedges, net of tax										(3)				(3)
Pension and postretirement adjustments, net of tax										2				2
Balance at July 30, 2022	99,319	$	788	(6,018)	$	(213)	$	3,051	$	(416)	$	7	$	3,217
Balance at May 1, 2021	104,286	$	791	(887)	$	(47)	$	2,507	$	(326)	$	5	$	2,930
Restricted stock issued	11													—
Issued under director and stock plans	219		7											7
Share-based compensation expense			8											8
Shares of common stock used to satisfy tax withholding obligations				(3)		(1)								(1)
Share repurchases				(125)		(7)								(7)
Reissued for ESPP			(7)	301		14								7
Net income								430						430
Cash dividends on common stock ($0.20 per share)								(21)						(21)
Translation adjustment, net of tax										(14)				(14)
Pension and postretirement adjustments, net of tax										2				2
Balance at July 31, 2021	104,516	$	799	(714)	$	(41)	$	2,916	$	(338)	$	5	$	3,341

	Additional Paid-In								Accumulated
	Capital &								Other				Total
Twenty-six weeks ended	Common Stock			Treasury Stock			Retained		Comprehensive		Noncontrolling		Shareholders'
(shares in thousands, amounts in millions)	Shares	Amount		Shares	Amount		Earnings		Loss		interests		Equity
Balance at January 29, 2022	99,071	$	770	(2,050)	$	(88)	$	2,900	$	(343)	$	4	$	3,243
Restricted stock issued	111													—
Issued under director and stock plans	137		4											4
Share-based compensation expense			16											16
Shares of common stock used to satisfy tax withholding obligations				(38)		(1)								(1)
Share repurchases				(4,050)		(129)								(129)
Reissued for ESPP			(2)	120		5								3
Noncontrolling interest capital contribution												4		4
Net income								227				(1)		226
Cash dividends on common stock ($0.80 per share)								(76)						(76)
Translation adjustment, net of tax										(75)				(75)
Change in hedges, net of tax										(2)				(2)
Pension and postretirement adjustments, net of tax										4				4
Balance at July 30, 2022	99,319	$	788	(6,018)	$	(213)	$	3,051	$	(416)	$	7	$	3,217
Balance at January 30, 2021	103,693	$	779	(74)	$	(3)	$	2,326	$	(331)	$	5	$	2,776
Restricted stock issued	479													—
Issued under director and stock plans	344		11											11
Share-based compensation expense			16											16
Shares of common stock used to satisfy tax withholding obligations				(195)		(11)								(11)
Share repurchases				(746)		(41)								(41)
Reissued for ESPP			(7)	301		14								7
Net income								632						632
Cash dividends on common stock ($0.40 per share)								(42)						(42)
Translation adjustment, net of tax										(10)				(10)
Pension and postretirement adjustments, net of tax										3				3
Balance at July 31, 2021	104,516	$	799	(714)	$	(41)	$	2,916	$	(338)	$	5	$	3,341

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

Second Quarter 2022 Form 10-Q Page 4

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
From operating activities:
Net income	$	226	$	632
Adjustments to reconcile net income to net cash from operating activities:
Non-cash impairment and other charges		5		45
Fair value adjustments to minority investments		38		(314)
Depreciation and amortization		105		93
Deferred income taxes		8		67
Share-based compensation expense		16		16
Gain on disposal of business		(18)		—
Change in assets and liabilities:
Merchandise inventories		(413)		(163)
Accounts payable		10		139
Accrued and other liabilities		(69)		(12)
Insurance recovery received for inventory loss		—		8
Other, net		(10)		(109)
Net cash (used in) provided by operating activities		(102)		402
From investing activities:
Capital expenditures		(156)		(87)
Purchase of business, net of cash acquired		(12)		—
Minority investments		(4)		(78)
Proceeds from sale of business		47		—
Proceeds from minority investments		12		—
Proceeds from sale of property		—		3
Insurance proceeds related to loss on property and equipment		—		3
Net cash used in investing activities		(113)		(159)
From financing activities:
Purchase of treasury shares		(129)		(41)
Dividends paid on common stock		(76)		(42)
Payment of obligations under finance leases		(3)		(1)
Shares of common stock repurchased to satisfy tax withholding obligations		(1)		(11)
Treasury stock reissued under employee stock plan		3		7
Proceeds from exercise of stock options		3		10
Contribution from non-controlling interest		4		—
Payment of revolving credit agreement costs		—		(1)
Net cash used in financing activities		(199)		(79)
Effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash		(5)		(1)
Net change in cash, cash equivalents, and restricted cash		(419)		163
Cash, cash equivalents, and restricted cash at beginning of year		850		1,718
Cash, cash equivalents, and restricted cash at end of period	$	431	$	1,881
Cash paid during the year:
Interest	$	8	$	6
Income taxes	$	103	$	229
Cash paid for amounts included in measurement of operating lease liabilities	$	354	$	358
Non-cash investing activities:
Right-of-use assets obtained in exchange for operating lease obligations	$	277	$	171
Assets obtained in exchange for finance lease obligations	$	1	$	4

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

Second Quarter 2022 Form 10-Q Page 5

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements contained in this report are unaudited. In the opinion of management, the condensed consolidated financial statements include all normal, recurring adjustments necessary for a fair presentation of the results for the interim periods presented. As used in these Notes to the Unaudited Condensed Consolidated Financial Statements, the terms “Foot Locker,” “Company,” “we,” “our,” and “us” refer to Foot Locker, Inc. and its consolidated subsidiaries.

The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the amounts reported in the accompanying Unaudited Condensed Consolidated Financial Statements and these Notes and related disclosures. Actual results may differ from those estimates. The results of operations for any interim period are not necessarily indicative of the results expected for the year.

The results of operations for the period ended July 30, 2022 are not necessarily indicative of the results to be expected for the full fiscal year due to the continued uncertainty of general economic conditions that may affect us for the remainder of 2022.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Notes to Consolidated Financial Statements contained in our 2021 Form 10-K.

There were no significant changes to the policies disclosed in Note 1, Summary of Significant Accounting Policies of our 2021 Form 10-K.

Recent Accounting Pronouncements

Recently issued accounting pronouncements did not, or are not believed by management to, have a material effect on our present or future consolidated financial statements.

2. Acquisitions

In 2021, we acquired WSS and atmos, two businesses that will allow us to further differentiate our product offerings, as well as our customer base, and diversify our retail store and omnichannel portfolio.

WSS

During the twenty-six weeks ended July 30, 2022, we paid an additional $4 million upon the finalization of the value of net assets acquired, with a corresponding increase to goodwill as compared with the amounts presented in the most recent annual report. The aggregate purchase price for the acquisition has increased to $811 million ($741 million, net of cash acquired). There were no additional payments or changes to the value of net assets acquired in the thirteen weeks ended July 30, 2022.

Second Quarter 2022 Form 10-Q Page 6

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2. Acquisitions (continued)

The following table represents the final allocation of the purchase price for WSS.

($ in millions)
Assets acquired:
Cash and cash equivalents	$	70
Merchandise inventories		82
Other current assets		10
Property and equipment, net		133
Operating lease right-of-use assets		143
Tradenames		296
Customer relationships		13
Other assets		4
Liabilities assumed:
Accounts payable	$	(58)
Current portion of obligations under finance leases		(3)
Current portion of lease obligations		(19)
Long-term portion of obligations under finance leases		(50)
Long-term lease obligations		(127)
Deferred taxes		(84)
Other liabilities		(4)
Goodwill		405
Total purchase price	$	811

atmos

During the thirteen and twenty-six weeks ended July 30, 2022, we paid an additional $5 million and $8 million, respectively, in connection with the finalization of certain post-closing conditions. The aggregate purchase price for the acquisition has increased to $368 million, subject to adjustment for the finalization of the value of net assets acquired and other post-closing matters. The preliminary purchase price includes contingent consideration initially measured at $35 million, which can reach up to $111 million based on achieving certain revenue growth and EBITDA performance targets. The fair value of the contingent consideration has not changed from the initial measurement. The preliminary purchase price does not yet reflect the finalization of the net working capital provisions and other post-closing adjustments. At closing, we placed $30 million in escrow, and an additional $6 million will be payable if certain post-closing conditions are satisfied. We expect to finalize the remaining amounts by the end of this fiscal year.

The following table represents the preliminary allocation of the purchase price for atmos and includes fair value adjustments to certain assets and liabilities since our most recent annual report. Changes to amounts reported at year end and the previous quarter included an $8 million increase in goodwill due to the additional purchase price, revised downward valuation of the tradenames and the addition of the customer list intangible. The adjustments did not have a significant effect on the consolidated results of operations. We determined that the atmos tradenames will have an indefinite life and will not be amortized.

We are assessing the tax deductibility of the goodwill related to the acquisition.

Second Quarter 2022 Form 10-Q Page 7

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2. Acquisitions (continued)

The following table represents the preliminary allocation of the purchase price for atmos.

($ in millions)
Assets acquired:
Cash and cash equivalents	$	6
Merchandise inventories		22
Other current assets		12
Property and equipment, net		7
Operating lease right-of-use assets		44
Tradenames		130
Customer relationships		9
Other assets		6
Liabilities assumed:
Accounts payable	$	(10)
Current portion of lease obligations		(10)
Other current liabilities		(8)
Long-term lease obligations		(35)
Deferred taxes		(44)
Other liabilities		(8)
Goodwill (1)		247
Total purchase price (2)	$	368

(1) Goodwill represented on this table is at the exchange rate in effect as of the date of acquisition.

(2) Total purchase price consists of $333 million in cash and $35 million of contingent consideration.

3. Revenue

The table below presents sales disaggregated based upon sales channel. Sales are attributable to the channel in which the sales transaction is initiated.

		Thirteen weeks ended			Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales by Channel
Stores	$	1,716	$	1,817	$	3,492	$	3,437
Direct-to-customers		349		458		748		991
Total sales	$	2,065	$	2,275	$	4,240	$	4,428

Sales disaggregated based upon geographic area are presented in the table below. Sales are attributable to the geographic area in which the sales transaction is fulfilled.

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales by Geography
United States	$	1,383	$	1,623	$	2,923	$	3,336
International		682		652		1,317		1,092
Total sales	$	2,065	$	2,275	$	4,240	$	4,428

Second Quarter 2022 Form 10-Q Page 8

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

3. Revenue (continued)

Contract Liabilities

We sell gift cards, which do not have expiration dates. Revenue from gift card sales is recorded when the gift cards are redeemed by customers. Breakage income is recognized as revenue in proportion to the pattern of rights exercised by the customer. The table below presents the activity of our gift card liability balance.

	July 30,		July 31,
($ in millions)	2022		2021
Gift card liability at beginning of year	$	46	$	41
Redemptions		(120)		(122)
Breakage recognized in sales		(8)		(9)
Activations		115		128
Foreign currency fluctuations		(1)		—
Gift card liability	$	32	$	38

We elected not to disclose the information about remaining performance obligations since the amount of gift cards redeemed after 12 months is not significant.

4. Segment Information

We have integrated all available shopping channels including stores, websites, apps, and social channels. Store sales are primarily fulfilled from the store’s inventory, but may also be shipped from any of our distribution centers or from a different store location if an item is not available at the original store. Direct-to-customer orders are generally shipped to our customers through our distribution centers but may also be shipped from any store or a combination of our distribution centers and stores depending on availability.

We evaluate performance based on several factors, primarily the banner’s financial results, referred to as division profit. Division profit reflects income before income taxes, impairment and other charges, corporate expense, non-operating income, and net interest expense.

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales	$	2,065	$	2,275	$	4,240	$	4,428
Operating Results
Division profit		184		332	$	444	$	647
Less: Impairment and other charges (1)		12		36		18		40
Less: Corporate expense (2)		33		32		70		61
Income from operations		139		264		356		546
Interest expense, net		(5)		(2)		(10)		(4)
Other income / (expense), net (3)		9		325		(13)		329
Income before income taxes	$	143	$	587	$	333	$	871

(1) See Note 5, Impairment and Other Charges for further detail.

(2) Corporate expense consists of unallocated selling, general and administrative expenses, as well as depreciation and amortization related to our corporate headquarters, centrally managed departments, unallocated insurance and benefit programs, certain foreign exchange transaction gains and losses, and other items.  

(3) Other income / (expense), net for the thirteen weeks and twenty-six weeks ended July 30, 2022 represented primarily the loss on the change in fair value of our investment in Retailors, Ltd., a publicly-listed entity, which was partially offset by other income. See Note 6, Other Income / (Expense), net.

Second Quarter 2022 Form 10-Q Page 9

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

5. Impairment and Other Charges

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Transformation consulting	$	9	$	—	$	10	$	—
Impairment of long-lived assets and right-of-use assets		2		39		5		39
Acquisition and integration costs		1		—		3		—
Lease termination costs		—		4		—		4
Impairment of investments		—		—		—		2
Reorganization costs		—		—		—		2
Insurance recovery		—		(7)		—		(7)
Total impairment and other charges	$	12	$	36	$	18	$	40

For the thirteen and twenty-six weeks ended July 30, 2022, we incurred $9 million and $10 million of transformation consulting expense, respectively. We recorded impairment charges of $2 million and $5 million related to long-lived assets and right-of-use assets, as well as accelerated tenancy charges for the thirteen and twenty-six weeks ended July 30, 2022, respectively. Additionally, we recorded $1 million and $3 million in acquisition and integration costs related to WSS and atmos for the thirteen and twenty-six weeks ended July 30, 2022, respectively.

For the thirteen and twenty-six weeks ended July 31, 2021, we recorded impairment charges of $39 million, related to the decision to exit the Footaction banner. For the thirteen and twenty-six weeks ended July 31, 2021, we recorded charges of $4 million in lease-related termination costs, offset by $7 million of insurance recovery income related to 2020 social unrest losses. For the twenty-six weeks ended July 31, 2021, we recorded an impairment charge of $2 million related to the underperformance of one of our minority investments, and a severance charge of $2 million in connection with the reorganization of certain support functions.

6. Other Income / (Expense), net

Effective June 27, 2022, the Company reached a definitive agreement to sell all assets related to the Eastbay Team Sales business, consisting primarily of inventory and accounts receivable. We received proceeds of $47 million from the transaction, resulting in a gain of $18 million, reported in other income / (expense), net.

7. Cash, Cash Equivalents, and Restricted Cash

The table below provides a reconciliation of cash and cash equivalents, as reported on our Condensed Consolidated Balance Sheets, to cash, cash equivalents, and restricted cash, as reported on our Condensed Consolidated Statements of Cash Flows.

	July 30,		July 31,
($ in millions)	2022		2021
Cash and cash equivalents	$	386	$	1,845
Restricted cash included in other current assets		7		7
Restricted cash included in other non-current assets		38		29
Cash, cash equivalents, and restricted cash	$	431	$	1,881

Amounts included in restricted cash primarily relate to amounts held in escrow in connection with various leasing arrangements in Europe and deposits held in insurance trusts to satisfy the requirement to collateralize part of the self-insured workers’ compensation and liability claims.

Second Quarter 2022 Form 10-Q Page 10

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

8. Goodwill

See footnote 2, Acquisitions, for additional information on our recent acquisitions.

In conjunction with the sale of the Eastbay Team Sales business, we allocated $6 million of goodwill to the assets sold, representing the allocable share of the fair value of the reporting unit disposed of.

We review goodwill for impairment annually during the first quarter of each fiscal year, or more frequently if impairment indicators arise. The review of impairment consists of either using a qualitative approach to determine whether it is more likely than not that the fair value of the assets is less than their respective carrying values or a one-step quantitative impairment test. The results of the first quarter analysis did not result in an impairment since the fair value of each reporting unit exceeded its carrying value.

9. Other Intangible Assets, net

The components of finite-lived intangible assets and intangible assets not subject to amortization are as follows:

		July 30, 2022						July 31, 2021
	Gross		Accum.		Net		Gross		Accum.		Net
($ in millions)	value		amort.		value		value		amort.		value
Amortized intangible assets: (1)
Lease acquisition costs	$	97	$	(95)	$	2	$	116	$	(112)	$	4
Trademarks/tradenames (2)		18		(18)		—		20		(17)		3
Customer lists		20		(5)		15		—		—		—
	$	135	$	(118)	$	17	$	136	$	(129)	$	7
Indefinite life intangible assets: (1)
Trademarks/tradenames					$	415					$	9
Other intangible assets, net					$	432					$	16

(1) The change in the ending balances also reflects the effect of foreign currency fluctuations due primarily to movements of the euro in relation to the U.S. dollar.

(2) During the fourth quarter of 2021, we recorded a non-cash impairment charge related to the Footaction tradename.  

In connection with the acquisitions of WSS and atmos, we recognized indefinite life intangible assets of $296 million for WSS related tradenames and $130 million for atmos related tradenames. Additionally, we recognized customer list intangible assets of $13 million for WSS and $9 million for atmos, both of which will be amortized over 3 years. The intangibles related to atmos were originally recorded at the exchange rate in effect as of the date of acquisition and are presented in the above table at current period exchange rates. Amortizing intangible assets primarily represent the WSS and atmos customer lists, and lease acquisition costs, which are amounts that are required to secure prime lease locations and other lease rights, primarily in Europe.

Amortization expense recorded is as follows:

	Thirteen weeks ended					Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Amortization expense	$	2	$	1	$	5	$	2

Second Quarter 2022 Form 10-Q Page 11

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

9. Other Intangible Assets, net (continued)

Estimated future amortization expense for finite-life intangible assets is as follows:

($ in millions)
Remainder of 2022	$	4
2023		7
2024		5
2025		1

10. Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss (“AOCL”), net of tax, is comprised of the following:

	July 30,		July 31,		January 29,
($ in millions)	2022		2021		2022
Foreign currency translation adjustments	$	(182)	$	(74)	$	(107)
Hedge contracts		(2)		(1)		—
Unrecognized pension cost and postretirement benefit		(232)		(263)		(236)
	$	(416)	$	(338)	$	(343)

The changes in AOCL for the twenty-six weeks ended July 30, 2022 were as follows:

	Foreign				Items Related
	Currency				to Pension and
	Translation				Postretirement
($ in millions)	Adjustments		Hedges		Benefits		Total
Balance as of January 29, 2022	$	(107)		—	$	(236)	$	(343)
OCI before reclassification		(75)		2		—		(73)
Reclassification of hedges, net of tax		—		(4)		—		(4)
Amortization of pension actuarial loss, net of tax		—		—		4		4
Other comprehensive income		(75)		(2)		4		(73)
Balance as of July 30, 2022	$	(182)	$	(2)	$	(232)	$	(416)

Reclassifications from AOCL for the twenty-six weeks ended July 30, 2022 were as follows:

($ in millions)
Reclassification of hedge loss:
Cross-currency swap	$	(4)
Income tax		—
Reclassification of hedges, net of tax	$	(4)
Amortization of actuarial loss:
Pension benefits	$	5
Income tax benefit		(1)
Amortization of actuarial loss, net of tax	$	4
Total, net of tax	$	—

Second Quarter 2022 Form 10-Q Page 12

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

11. Financial Instruments and Risk Management

Fair Value Hedge

On May 6, 2022, we entered into a cross-currency swap contract to reduce the effect of the fluctuating U.S. Dollar (“USD”) to Japanese Yen (“JPY”) foreign exchange rate on our foreign currency-denominated intercompany loan between our Japanese and U.S. subsidiary. We expect the gains and losses on this contract to offset losses and gains on the hedged transaction in an effort to reduce the earnings volatility resulting from the remeasurement of the principal and interest accrued on the loan. Though the intercompany loan eliminates in consolidation, the foreign currency remeasurement of the loan and interest by the U.S. subsidiary is reflected in the consolidated financial statements.

The cross-currency swap contract has a notional amount of JPY 11 billion and final receipt of $85 million. The cross-currency swap contract, which matures on November 2, 2031, swaps Yen-denominated interest payments for U.S. dollar-denominated interest payments, thereby economically converting the JPY 11 billion fixed-rate 3.51% intercompany loan to a fixed-rate 6.77% USD-denominated receivable for our U.S. subsidiary.

We designated the cross-currency swap contract to hedge the changes in value of the intercompany loan and its variability on earnings. We will apply fair value hedge accounting, and we will consider market factors other than the change in the spot exchange rate on the notional amount of the swap to be excluded components. The foreign currency spot rate fluctuations on the cross-currency swap notional amount and interest accruals are reported in earnings each period, while all other changes are reported in other comprehensive income. Because the terms of the hedged item and the hedging instrument match and the likelihood of swap counterparty default is not probable, the hedge is expected to exactly offset changes in the fair value of the foreign currency debt resulting from to foreign currency fluctuations over the term of the swap.

As of July 30, 2022, the cross-currency swap had a fair value of $1 million and was included in other assets. We record the changes in the fair value of the contract to AOCL. Each period, we reclassify an amount out of AOCL equal to the remeasurement gain or loss on the hedged intercompany loan that is recorded in selling, general and administrative expenses. As of July 30, 2022, there was $3 million in AOCL, net of tax, related to the cross-currency swap. In addition, we recognize swap interest income based on the differential in fixed interest rates per the contract. For the thirteen and twenty-six weeks ended July 30, 2022, we recorded $1 million of income in interest expense, net. Refer to Note 10 for further information regarding amounts recorded in AOCL.

12. Fair Value Measurements

Our financial assets are recorded at fair value, using a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are categorized as follows:

Level 1 – Quoted prices for identical instruments in active markets.

Level 2 – Observable inputs other than quoted prices included within Level 1, including quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs or significant value-drivers are observable in active markets.

Level 3 – Model-derived valuations in which one or more significant inputs or significant value-drivers are unobservable.

Second Quarter 2022 Form 10-Q Page 13

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

12. Fair Value Measurements (continued)

In 2021, we invested $68 million to take a common stock minority stake in a public entity, Retailors, Ltd, which is traded on the Tel Aviv stock exchange. This investment is classified as a Level 1 instrument since the fair value is readily available in an active market.

The fair value of the auction rate security, classified as available-for-sale, is determined by using quoted prices for similar instruments in active markets and accordingly is classified as a Level 2 instrument.

The fair value of the contingent consideration liability associated with the atmos acquisition is estimated using an option pricing model simulation that determines an average projected payment value across numerous iterations.

Our derivative financial instruments are valued using market-based inputs to valuation models. These valuation models require a variety of inputs, including contractual terms, market prices, yield curves, and measures of volatility and, therefore, are classified as Level 2 instruments.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

($ in millions)	As of July 30, 2022						As of July 31, 2021
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Minority investment in common stock	$	107	$	—	$	—	$	92	$	—	$	—
Available-for-sale security		—		6		—		—		7		—
Foreign exchange forward contracts		—		1		—		—		1		—
Cross-currency swap contract		—		1		—		—		—		—
Total assets	$	107	$	8	$	—	$	92	$	8	$	—
Liabilities
Contingent consideration		—		—		35		—		—		—
Foreign exchange forward contracts		—		—		—		—		2		—
Total liabilities	$	—	$	—	$	35	$	—	$	2	$	—

There were no transfers into or out of Level 1, Level 2, or Level 3 assets and liabilities for any of the periods presented.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Assets and liabilities recognized or disclosed at fair value on the consolidated financial statements on a nonrecurring basis include items such as property, plant and equipment, operating lease right-of-use assets, goodwill, other intangible assets, and minority investments that are not accounted for under the equity method of accounting. These assets are measured using Level 3 inputs, if determined to be impaired.

Minority investments measured using the fair value measurement alternative had a carrying value of $579 million and $612 million as of July 30, 2022 and July 31, 2021, respectively.

Second Quarter 2022 Form 10-Q Page 14

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

12. Fair Value Measurements (continued)

Long-Term Debt

The fair value of long-term debt is determined by using model-derived valuations in which all significant inputs or significant value drivers are observable in active markets and, therefore, are classified as Level 2. The balance as of July 30, 2022 includes the $400 million 4% Notes. The carrying value and estimated fair value of long-term debt were as follows:

($ in millions)	July 30, 2022		July 31, 2021
Carrying value (1)	$	394	$	99
Fair value	$	313	$	102

(1) The carrying value of debt as of July 30, 2022 reflects $6 million of issuer’s discount and costs related to the 4% Notes.

The carrying values of cash and cash equivalents, and other current receivables and payables approximate their fair value.

13. Earnings Per Share

We account for earnings per share (“EPS”) using the treasury stock method. Basic EPS is computed by dividing net income for the period by the weighted-average number of common shares outstanding at the end of the period. Diluted earnings per share reflects the weighted-average number of common shares outstanding during the period used in the basic EPS computation plus dilutive common stock equivalents. The computation of diluted earnings per share does not assume conversion, exercise, or contingent issuance of securities that would have an anti-dilutive effect on EPS.

The computation of basic and diluted EPS is as follows:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
(in millions, except per share data)	2022		2021		2022		2021
Net income attributable to Foot Locker, Inc.	$	94	$	430	$	227	$	632
Weighted-average common shares outstanding		94.1		103.8		95.1		103.7
Dilutive effect of potential common shares		1.0		1.4		1.0		1.4
Weighted-average common shares outstanding assuming dilution		95.1		105.2		96.1		105.1
Earnings per share - basic	$	1.00	$	4.14	$	2.39	$	6.10
Earnings per share - diluted	$	0.99	$	4.09	$	2.36	$	6.02
Anti-dilutive share-based awards excluded from diluted calculation		2.8		1.5		2.7		1.7

Performance stock units related to our long-term incentive programs of 0.8 million and 0.6 million have been excluded from diluted weighted-average shares for the periods ended July 30, 2022 and July 31, 2021, respectively. The issuance of these shares is contingent on our performance metrics as compared to the pre-established performance goals, which have not been achieved.

Second Quarter 2022 Form 10-Q Page 15

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

14. Pension

The components of net periodic pension benefit expense are presented in the table below. Service cost is recognized as part of SG&A expense, while the other components are recognized as part of Other income / (expense), net.

	Thirteen weeks ended				Twenty-six weeks ended
		July 30,		July 31,		July 30,		July 31,
($ in millions)		2022		2021		2022		2021
Service cost	$	3	$	4	$	7	$	8
Interest cost		5		5		10		9
Expected return on plan assets		(7)		(8)		(15)		(17)
Amortization of net loss		3		2		5		5
Net benefit expense	$	4	$	3	$	7	$	5

15. Share-Based Compensation

Total compensation expense, included in SG&A, and the associated tax benefits recognized related to our share-based compensation plans, were as follows:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Options and employee stock purchase plan	$	2	$	2	$	3	$	4
Restricted stock units and performance stock units		7		6		13		12
Total share-based compensation expense	$	9	$	8	$	16	$	16
Tax benefit recognized	$	1	$	1	$	2	$	2

Valuation Model and Assumptions

We use the Black-Scholes option-pricing model to estimate the fair value of options and the stock purchase plan. The Black-Scholes option-pricing model incorporates various and subjective assumptions, including expected term and expected volatility.

The table below shows assumptions used to compute share-based compensation expense for awards granted during the twenty-six weeks ended July 30, 2022 and July 31, 2021.

		Stock Option Plans						Stock Purchase Plan
	July 30,			July 31,			July 30,			July 31,
	2022			2021			2022			2021
Weighted-average risk free rate of interest		2.3	%		0.9	%		0.4	%		0.2	%
Expected volatility		48.2	%		47	%		40	%		48	%
Weighted-average expected award life (in years)		5.3			5.5			1.0			1.0
Dividend yield		3.7	%		1.5	%		2.0	%		5.0	%
Weighted-average fair value	$	10.5		$	20.22		$	23.47		$	7.84

Second Quarter 2022 Form 10-Q Page 16

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

15. Share-Based Compensation (continued)

The information in the table below provides activity under our stock option plans for the twenty-six weeks ended July 30, 2022.

		Weighted-		Weighted-
	Number	Average		Average
	of	Remaining		Exercise
	Shares	Contractual Life		Price
	(in thousands)	(in years)		(per share)
Options outstanding at the beginning of the year	3,211			$	48.84
Granted	522				31.02
Exercised	(116)				26.15
Expired or cancelled	(148)				51.29
Options outstanding at July 30, 2022	3,469		5.1	$	46.82
Options exercisable at July 30, 2022	2,635		3.9	$	51.67
Options available for future grant at July 30, 2022	1,837

The total fair value of options vested July 30, 2022 and July 31, 2021 was $4 million for both periods. The cash received from option exercises during the thirteen and twenty-six weeks ended July 30, 2022 were $1 million and $3 million, respectively. The related tax benefits realized from option exercises during the thirteen and twenty-six weeks ended July 30, 2022 were not significant. The cash received from option exercises during the thirteen and twenty-six weeks ended July 31, 2021 were $6 million and $10 million, respectively. The related tax benefits realized from option exercises during the thirteen and twenty-six weeks ended July 31, 2021 were $1 million and $2 million, respectively.

The total intrinsic value of options exercised (the difference between the market price of our common stock on the exercise date and the price paid by the optionee to exercise the option) is presented below:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Exercised	$	—	$	5	$	—	$	8

The aggregate intrinsic value for stock options outstanding, and outstanding and exercisable (the difference between our closing stock price on the last trading day of the period and the exercise price of the options, multiplied by the number of in-the-money stock options) is presented below:

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
Outstanding	$	5	$	40
Outstanding and exercisable	$	3	$	20

As of July 30, 2022, there was $5 million of total unrecognized compensation cost related to nonvested stock options which is expected to be recognized over a remaining weighted-average period of 1.6 years.

Second Quarter 2022 Form 10-Q Page 17

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

15. Share-Based Compensation (continued)

The table below summarizes information about stock options outstanding and exercisable at July 30, 2022.

	Options Outstanding				Options Exercisable
		Weighted-
		Average	Weighted-			Weighted-
		Remaining	Average			Average
Range of Exercise	Number	Contractual	Exercise		Number	Exercise
Prices	Outstanding	Life	Price		Exercisable	Price
	(in thousands, except prices per share and contractual life)
$21.60 - $36.51	1,326	7.4	$	26.37	601	$	24.21
$44.78 - $48.98	449	3.3		45.02	448		45.02
$53.61 - $58.94	506	5.8		56.68	398		57.44
$62.02 - $72.83	1,188	3.0		66.13	1,188		66.13
	3,469	5.1	$	46.82	2,635	$	51.67

Restricted Stock Units and Performance Stock Units

Restricted stock units (“RSU”) are awarded to certain officers, key employees of the Company, and nonemployee directors. Additionally, performance stock units (“PSU”) are awarded to officers and certain key employees in connection with our long-term incentive program. Each RSU and PSU represents the right to receive one share of our common stock provided that the applicable performance and vesting conditions are satisfied. PSU awards granted in 2022 also include a performance objective based on our relative total shareholder return over the performance period to a pre-determined peer group, assuming the reinvestment of dividends. The fair value of these awards is determined using a Monte Carlo simulation as of the date of the grant and share-based compensation expense will not be adjusted should the target awards vary from actual awards.  

Generally, RSU awards fully vest after the passage of time, typically three years for employees and one year for nonemployee directors, provided there is continued service with the Company until the vesting date, subject to the terms of the award. PSU awards are earned only after the attainment of performance goals in connection with the relevant performance period and vest after an additional one-year period. No dividends are paid or accumulated on any RSU or PSU awards. Compensation expense is recognized over the vesting period. RSU and PSU activity for the twenty-six weeks ended July 30, 2022 is summarized as follows:

			Weighted-Average
	Number		Remaining		Weighted-Average
	of		Contractual		Grant Date
	Shares		Life		Fair Value
		(in thousands)		(in years)		(per share)
Nonvested at beginning of year		1,391			$	43.95
Granted		1,026				30.22
Vested		(110)				55.58
Performance adjustment (1)		(60)
Forfeited		(92)				34.41
Nonvested at July 30, 2022		2,155		1.8	$	36.95
Aggregate value ($ in millions)	$	80

(1) This represents adjustments made to PSUs reflecting changes in estimates based upon our current performance against predefined financial targets.  

Second Quarter 2022 Form 10-Q Page 18

NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

15. Share-Based Compensation (continued)

The total value of RSU and PSU awards that vested during the twenty-six weeks ended July 30, 2022 and July 31, 2021 was $6 million and $22 million, respectively. As of July 30, 2022, there was $44 million of total unrecognized compensation cost related to nonvested awards.

16. Legal Proceedings

Legal proceedings pending against the Company or its consolidated subsidiaries consist of ordinary, routine litigation, including administrative proceedings, incidental to the business of the Company or businesses that have been sold or discontinued by the Company in past years. These legal proceedings include commercial, intellectual property, customer, environmental, and employment-related claims.

We do not believe that the outcome of any such legal proceedings pending against the Company or its consolidated subsidiaries, as described above, would have a material adverse effect on our consolidated financial position, liquidity, or results of operations, taken as a whole, based upon current knowledge and taking into consideration current accruals. Litigation is inherently unpredictable. Judgments could be rendered or settlements made that could adversely affect the Company’s operating results or cash flows in a particular period.

Second Quarter 2022 Form 10-Q Page 19

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Business Overview

Foot Locker, Inc. leads the celebration of sneaker and youth culture around the globe through a portfolio of brands including Foot Locker, Lady Foot Locker, Kids Foot Locker, Champs Sports, Eastbay, atmos, WSS, Footaction, and Sidestep. As of July 30, 2022, we operated 2,799 primarily mall-based stores, as well as stores in high-traffic urban retail areas and high streets, in 28 countries across the United States, Canada, Europe, Australia, New Zealand, and Asia, as well as websites and mobile apps. Our purpose is to inspire and empower youth culture around the world, by fueling a shared passion for self-expression and creating unrivaled experiences at the heart of the global sneaker community.

We use our omni-channel capabilities to bridge the digital world and physical stores, including order-in-store, buy online and pickup-in-store, and buy online and ship-from-store, as well as e-commerce. We operate websites and mobile apps aligned with the brand names of our store banners including footlocker.com, kidsfootlocker.com, champssports.com, atmosusa.com, shopwss.com and related e-commerce sites in the various international countries that we operate. These sites offer some of the largest online product selections and provide a seamless link between e-commerce and physical stores. We also operate the website for eastbay.com.

Store Count

At July 30, 2022, we operated 2,799 stores as compared with 2,858 and 2,911 stores at January 29, 2022 and July 31, 2021, respectively.

Franchise Operations

A total of 148 franchised stores were operating at July 30, 2022, as compared with 142 and 134 stores at January 29, 2022 and July 31, 2021, respectively, operating in the Middle East and Asia. Revenue from franchised stores was not significant for any of the periods presented. These stores are not included in the operating store count above.

COVID-19 Update

We continue to monitor outbreaks of COVID-19 which cause store closures, reduced operating hours, capacity limitations, and social distancing that may be required to help ensure the health and safety of our team members and our customers. COVID-19 has had, and may continue to have, an effect on ports and trade, as well as global travel.

Reconciliation of Non-GAAP Measures

In addition to reporting our financial results in accordance with U.S. generally accepted accounting principles (“GAAP”), we report certain financial results that differ from what is reported under GAAP. We have presented certain financial measures identified as non-GAAP, such as sales changes excluding foreign currency fluctuations, adjusted income before income taxes, adjusted net income, and adjusted diluted earnings per share.

We present certain amounts as excluding the effects of foreign currency fluctuations, which are also considered non-GAAP measures. Where amounts are expressed as excluding the effects of foreign currency fluctuations, such changes are determined by translating all amounts in both years using the prior-year average foreign exchange rates. Presenting amounts on a constant currency basis is useful to investors because it enables them to better understand the changes in our business that are not related to currency movements.

Second Quarter 2022 Form 10-Q Page 20

These non-GAAP measures are presented because we believe they assist investors in comparing our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core business or affect comparability. In addition, these non-GAAP measures are useful in assessing our progress in achieving our long-term financial objectives. We estimate the tax effect of all non-GAAP adjustments by applying a marginal tax rate to each of the respective items. The income tax items represent the discrete amount that affected the period. The non-GAAP financial information is provided in addition to, and not as an alternative to, our reported results prepared in accordance with GAAP.

Effective with the first quarter of 2022, the calculation for non-GAAP earnings excludes gains and losses from all minority investments, including the adjustments related to the investment in Retailors, Ltd. We believe this is a more representative measure of our recurring earnings, assists in the comparability of results, and is consistent with how management reviews performance. The non-GAAP results for 2021 have been recast, as applicable, to conform to the current year’s presentation. As we report quarterly results through 2022, we will provide updated non-GAAP reconciliations for the corresponding prior year’s quarter under this revised definition.

Presented below is a reconciliation of GAAP and non-GAAP.  

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions, except per share amounts)	2022		2021		2022		2021
Pre-tax income:
Income before income taxes	$	143	$	587	$	333	$	871
Pre-tax amounts excluded from GAAP:
Impairment and other charges		12		36		18		40
Other income / expense, net		(6)		(320)		18		(320)
Adjusted income before income taxes (non-GAAP)	$	149	$	303	$	369	$	591
After-tax income:
Net income attributable to Foot Locker, Inc.	$	94	$	430	$	227		632
After-tax adjustments excluded from GAAP:
Impairment and other charges, net of income tax benefit of $3, $9, $5, and $10, respectively		9		27		13		30
Other income / expense, net of (expense)/income tax benefit of $(3), $(84), $3, and $(84), respectively		(3)		(236)		15		(236)
Tax reserves charge		5		—		5		—
Adjusted net income (non-GAAP)	$	105	$	221	$	260		426
Earnings per share:
Diluted earnings per share	$	0.99	$	4.09	$	2.36		6.02
Diluted EPS amounts excluded from GAAP:
Impairment and other charges		0.09		0.25		0.14		0.28
Other income / expense, net		(0.03)		(2.25)		0.16		(2.25)
Tax reserves charge		0.05		—		0.05		—
Adjusted diluted earnings per share (non-GAAP)	$	1.10	$	2.09	$	2.71		4.05

During the thirteen and twenty-six weeks ended July 30, 2022, we recorded pre-tax charges of $12 million and $18 million, respectively, classified as Impairment and Other. See the Impairment and Other Charges section for further information.

Second Quarter 2022 Form 10-Q Page 21

The adjustments made to other income / (expense), net reflect gains or losses primarily associated with our minority investments. See the Other Income / (Expense), net section for further information.

In the second quarter of 2022, we recorded a $5 million charge related to our income tax reserves due to the resolution of a foreign tax settlement.

Segment Reporting

We have determined that we have three operating segments, North America, EMEA, and Asia Pacific. Our North America operating segment includes the results of the following banners operating in the U.S. and Canada: Foot Locker, Kids Foot Locker, Lady Foot Locker, Champs Sports, WSS, and Footaction, including each of their related e-commerce businesses, as well as our Eastbay business. Our EMEA operating segment includes the results of the following banners operating in Europe: Foot Locker, Sidestep, and Kids Foot Locker, including each of their related e-commerce businesses. Our Asia Pacific operating segment includes the results of the Foot Locker banner and its related e-commerce business operating in Australia, New Zealand, and Asia, as well as atmos, which operates primarily in Asia. We have further aggregated these operating segments into one reportable segment based upon their shared customer base and similar economic characteristics.

Results of Operations

We evaluate performance based on several factors, primarily the banner’s financial results, referred to as division profit. Division profit reflects income before income taxes, impairment and other charges, corporate expenses, non-operating income, and net interest expense.

The table below summarizes our results.

	Thirteen weeks ended					Twenty-six weeks ended
	July 30,			July 31,		July 30,		July 31,
($ in millions)	2022			2021		2022		2021
Sales		$	2,065	$	2,275	$	4,240	$	4,428
Operating Results
Division profit			184		332		444		647
Less: Impairment and other charges (1)			12		36		18		40
Less: Corporate expense (2)			33		32		70		61
Income from operations			139		264		356		546
Interest expense, net			(5)		(2)		(10)		(4)
Other income / (expense), net (3)			9		325		(13)		329
Income before income taxes		$	143	$	587	$	333	$	871

(1) See the Impairment and Other Charges section for further information.

(2) Corporate expense consists of unallocated selling, general and administrative expenses as well as depreciation and amortization related to the Company’s corporate headquarters, centrally managed departments, unallocated insurance and benefit programs, certain foreign exchange transaction gains and losses, and other items.

(3) Other income / (expense), net includes non-operating items, franchise royalty income, changes in fair value of minority interests measured at fair value or using the fair value measurement alternative, changes in the market value of our available-for-sale security, our share of earnings or losses related to our equity method investments, and net benefit expense related to our pension and postretirement programs excluding the service cost component. See the Other income / (expense), net section for further information.

Second Quarter 2022 Form 10-Q Page 22

Sales

All references to comparable-store sales for a given period relate to sales of stores that were open at the period-end and had been open for more than one year. The computation of consolidated comparable sales also includes our direct-to-customers channel. Stores opened or closed during the period are not included in the comparable-store base; however, stores closed temporarily for relocation or remodeling are included. Stores that were temporarily closed due to the COVID-19 pandemic are also included in the computation of comparable-store sales. Computations exclude the effect of foreign currency fluctuations.

Sales from acquired businesses that include inventory are included in the computation of comparable-store sales after 15 months of operations. Accordingly, sales of WSS and atmos have been excluded from the computation of comparable-store sales. As a result of the Eastbay Team Sales divestiture, sales from this business were removed for the computation of comparable sales for all periods.

The information shown below represents certain sales metrics by sales channel.

	Thirteen weeks ended						Twenty-six weeks ended
	July 30,			July 31,			July 30,			July 31,
($ in millions)	2022			2021			2022			2021
Stores
Sales	$	1,716		$	1,817		$	3,492		$	3,437
$ Change	$	(101)					$	55
% Change		(5.6)	%					1.6	%
% of total sales		83.1	%		79.9	%		82.4	%		77.6	%
Comparable sales (decrease) increase		(6.0)	%		28.4	%		0.5	%		54.0	%
Direct-to-customers
Sales	$	349		$	458		$	748		$	991
$ Change	$	(109)					$	(243)
% Change		(23.8)	%					(24.5)	%
% of total sales		16.9	%		20.1			17.6	%		22.4	%
Comparable sales decrease		(26.7)	%		(35.1)			(28.3)	%		(8.2)	%

For the thirteen weeks ended July 30, 2022, total sales decreased by $210 million, or 9.2%, to $2,065 million, as compared with the corresponding prior-year period. For the twenty-six weeks ended July 30, 2022, total sales decreased by $188 million, or 4.2%, to $4,240 million, as compared with the corresponding prior-year period. Excluding the effect of foreign currency fluctuations, total sales decreased by $139 million, or 6.1%, for the thirteen weeks ended July 30, 2022, and decreased by $76 million, or 1.7%, for the twenty-six weeks ended July 30, 2022. Sales from our acquired WSS and atmos banners were $137 million and $48 million, respectively, for the thirteen weeks ended July 30, 2022, and $275 million and $101 million, respectively for the twenty-six weeks ended July 30, 2022. The information shown below represents certain combined stores and direct-to-customers sales metrics, excluding the sales from WSS and atmos.

	Thirteen weeks				Twenty-six weeks
	Constant Currencies		Comparable Sales		Constant Currencies		Comparable Sales
North America	(21.5)	%	(16.1)	%	(19.2)	%	(13.9)	%
EMEA	6.7	%	4.5	%	26.7	%	23.6	%
Asia Pacific	21.5	%	17.7	%	18.1	%	14.0	%
	(14.1)	%	(10.3)	%	(10.1)	%	(6.2)	%

Second Quarter 2022 Form 10-Q Page 23

Despite the decline in sales as compared with our record levels in 2021, sales exceeded the results of 2019. Excluding the effect of foreign exchange rate fluctuations and our acquisitions, sales increased by 7.4% and by 1.1% for the quarter and year-to-date periods, respectively, as compared with the corresponding periods of 2019.

Comparable sales for both our stores and direct-to-customer channels decreased for the quarter. Our direct-to-customer channel saw significant decreases as shoppers navigated back to physical locations. For the year-to-date period, comparable sales were slightly up for our stores, while direct-to-customer decreased when compared with the prior year.

Our North American operating segment’s sales, excluding WSS, and comparable-store sales for the current year were negatively affected by the significant fiscal stimulus, which contributed to last year’s growth, as well as the effects of inflation on customer demand. Additionally, the wind down of the Footaction business negatively affected sales, last year we operated 211 stores as compared with 14 this quarter. Within EMEA, sales from the Foot Locker and Sidestep banners increased as tourism returned to more historical levels coupled with an increase in operating days resulting from COVID-19 related store closures in the prior year. Asia Pacific, excluding atmos, generated increases from both strong performance in Australia and New Zealand, coupled with growth in Asia, based on expansion in that region. Asia Pacific’s increases were also affected by the increase in operating days, the current year was essentially open for all days as compared with approximately 80% last year.

From a product perspective for the combined channels, sales declined for both the quarter and year-to-date periods and was related to decreased sales of footwear and apparel, partially offset by increased sales of accessories. The decline in footwear for the second quarter was primarily due to men’s and kids’ basketball footwear, and the decline in sales of apparel represented a decline in sales of men’s and performance apparel, however sales of women’s apparel generated an increase. For the year-to-date period, all wearer segments within the footwear category experienced declines, with the largest decreases coming from men’s and children’s basketball footwear styles. Apparel sales decreased in the men’s and children’s categories, while women’s increased.

Gross Margin

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
	2022		2021		2022		2021
Gross margin rate	31.7	%	35.1	%	32.9	%	34.9	%
Basis point decrease in the gross margin rate	(340)				(200)
Components of the change:
Merchandise margin rate decline	(260)				(160)
Occupancy and buyers’ compensation expense rate	(80)				(40)

Gross margin is calculated as sales minus cost of sales. Cost of sales includes: the cost of merchandise, freight, distribution costs including related depreciation expense, shipping and handling, occupancy and buyers’ compensation. Occupancy costs include rent (including fixed common area maintenance charges and other fixed non-lease components), real estate taxes, general maintenance, and utilities.

The gross margin rate decreased to 31.7% for the thirteen weeks ended July 30, 2022, as compared with the corresponding prior-year period, reflecting a 260-basis point decrease in the merchandise margin rate, and an 80-basis point deleverage in the occupancy and buyers’ compensation rate. For the twenty-six weeks ended July 30, 2022, the gross margin rate declined by 200 basis points, reflecting a 160-basis point decrease in the merchandise margin rate and a 40-basis point deleverage in the occupancy and buyers’ compensation rate.

Second Quarter 2022 Form 10-Q Page 24

The declines in merchandise margin rate reflected higher markdowns versus historically-low levels last year and higher supply chain costs. Additionally, merchandise margin is negatively affected by the recent acquisitions that generate a lower rate, which is offset by lower occupancy costs and therefore not significantly affecting the overall gross margin rate. The occupancy rate deleverage also reflected the effect of prior year rent abatements related to COVID-19 that represented $6 million and $11 million for the thirteen and twenty-six weeks of last year, respectively, as compared with insignificant amounts this year.

Selling, General and Administrative Expenses (SG&A)

	Thirteen weeks ended						Twenty-six weeks ended
	July 30,			July 31,			July 30,			July 31,
($ in millions)	2022			2021			2022			2021
SG&A	$	452		$	450		$	915		$	868
$ Change	$	2					$	47
% Change		0.4	%					5.4	%
SG&A as a percentage of sales		21.9	%		19.8	%		21.6	%		19.6	%

SG&A increased by $2 million, or $22 million excluding the effect of foreign currency fluctuations, for the thirteen weeks ended July 30, 2022, as compared with the corresponding prior-year period. For the year-to-date period SG&A increased by $47 million, or $77 million excluding the effect of foreign currency fluctuations. Our newly acquired businesses contributed $38 million and $72 million for the quarter and year-to-date periods, respectively, to the overall increase. As a percentage of sales, SG&A increased by 210 basis points and 200 basis points for the thirteen and twenty-six weeks ended July 30, 2022, respectively, driven by higher labor costs, information technology and support expenses, as well as the effect of COVID-19 related matters in the prior year.

SG&A for the thirteen and twenty-six weeks ended July 30, 2022 included nominal payroll subsidies from local governments, compared with $4 million and $14 million for the corresponding prior-year periods, respectively.

Depreciation and Amortization

	Thirteen weeks ended					Twenty-six weeks ended
	July 30,			July 31,		July 30,			July 31,
($ in millions)	2022			2021		2022			2021
Depreciation and amortization	$	51		$	48	$	105		$	93
$ Change	$	3				$	12
% Change		6.3	%				12.9	%

Depreciation and amortization expense increased by $3 million and $12 million for the thirteen weeks and twenty-six weeks ended July 30, 2022, respectively, as compared with the corresponding prior-year periods. Excluding the effect of foreign currency fluctuations, depreciation and amortization increased by $5 million and $15 million for the thirteen weeks and twenty-six weeks ended July 30, 2022, respectively, as compared with the corresponding prior-year periods. The increase was primarily related to the acquisitions of WSS and atmos.

Impairment and Other Charges

Transformation consulting charges were $9 million and $10 million for the thirteen and twenty-six weeks ended July 30, 2022, respectively. Impairment of long-lived assets and right-of-use assets was $2 million and $5 million for the thirteen and twenty-six weeks ended July 30, 2022, respectively, and $39 million for both the thirteen and twenty-six weeks ended July 31, 2021. Acquisition and integration costs related to WSS and atmos were $1 million and $3 million for the thirteen and twenty-six weeks ended July 30, 2022, respectively.

Second Quarter 2022 Form 10-Q Page 25

For the thirteen and twenty-six weeks ended July 31, 2021, we recorded charges of $4 million in lease-related termination costs, offset by $7 million of insurance recovery income related to 2020 social unrest losses. For the twenty-six weeks ended July 31, 2021, we recorded an impairment charge of $2 million related to the underperformance of one of our minority investments, and a severance charge of $2 million in connection with the reorganization of certain support functions.

Corporate Expense

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Corporate expense	$	33	$	32	$	70	$	61
$ Change	$	1			$	9

Corporate expense consists of unallocated general and administrative expenses as well as depreciation and amortization related to our corporate headquarters, centrally managed departments, unallocated insurance and benefit programs, certain foreign exchange transaction gains and losses, and other items.

Corporate expense increased by $1 million and $9 million for the thirteen and twenty-six weeks ended July 30, 2022, respectively, as compared with the corresponding prior-year periods. Depreciation and amortization included in corporate expense was $10 million and $9 million for the thirteen weeks ended July 30, 2022 and July 31, 2021, respectively, and $19 million and $16 million for the twenty-six weeks ended July 30, 2022 and July 31, 2021, respectively. These increases were primarily due to higher information technology and support expenses.

Operating Results

	Thirteen weeks ended						Twenty-six weeks ended
	July 30,			July 31,			July 30,			July 31,
($ in millions)	2022			2021			2022			2021
Division profit	$	184		$	332		$	444		$	647
Division profit margin		8.9	%		14.6	%		10.5	%		14.6	%

Division profit margin as a percentage of sales decreased to 8.9% and 10.5% of sales for the thirteen weeks and twenty-six weeks ended July 30, 2022, respectively, with both sales channels experiencing declines in gross margin and deleveraging expenses. WSS and atmos generated division profit of $6 million and $8 million, respectively for the second quarter, and $19 million and $16 million for the year-to-date period.

Interest Expense, Net

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Interest expense	$	(6)	$	(3)	$	(12)	$	(6)
Interest income		1		1		2		2
Interest (expense) income, net	$	(5)	$	(2)	$	(10)	$	(4)

We recorded $5 million and $10 million of net interest expense for the thirteen and twenty-six weeks ended July 30, 2022, respectively as compared with net interest expense of $2 million and $4 million for the corresponding prior-year periods. Interest expense increased primarily due to the issuance of the 4% Notes.

Second Quarter 2022 Form 10-Q Page 26

Other Income / (Expense), Net

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Other income / (expense), net	$	9	$	325	$	(13)	$	329

This caption includes non-operating items, including franchise royalty income, changes in fair value of minority investments measured at fair value or using the fair value measurement alternative, changes in the market value of our available-for-sale security, our share of earnings or losses related to our equity method investments, and net benefit (expense) related to our pension and postretirement programs excluding the service cost component.

The thirteen weeks ended July 30, 2022 reflected a gain of $18 million from the divestiture of Eastbay Team Sales, $13 million loss related to a decline in the fair value of our Retailors, Ltd. investment, partially offset by $1 million of income associated with our other minority investments. The twenty-six weeks ended July 30, 2022 reflected the gain from the divestiture of $18 million, a decline in our Retailors, Ltd. investment of $38 million, offset by $1 million of dividend income, and $1 million of income from our other minority investments. The prior year amounts included a gain of $290 million representing the fair value adjustment of our minority investment in GOAT, a gain of $24 million related to our Retailors, Ltd. investment, $4 million insurance recovery related to the 2020 social unrest, and $2 million of income associated with our other minority investments. These were all considered our non-GAAP adjustments in all of the periods presented.  

Other income / (expense), net also includes $3 million and $6 million of franchise income for the thirteen and twenty-six weeks ended July 30, 2022, respectively. The year-to-date period also includes a charge of $1 million related to our auction rate security.

Income Taxes

	Thirteen weeks ended						Twenty-six weeks ended
	July 30,			July 31,			July 30,			July 31,
($ in millions)	2022			2021			2022			2021
Provision for income taxes	$	49		$	157		$	107		$	239
Effective tax rate		34.5	%		26.8	%		32.1	%		27.4	%

Our current year interim provision for income taxes was measured using an estimated annual effective tax rate, which represented a blend of federal, state, and foreign taxes and included the effect of certain nondeductible items as well as changes in our mix of domestic and foreign earnings or losses, adjusted for discrete items that occurred within the periods presented.

We regularly assess the adequacy of our provisions for income tax contingencies in accordance with applicable authoritative guidance on accounting for income taxes. As a result, we may adjust the reserves for unrecognized tax benefits considering new facts and developments, such as changes to interpretations of relevant tax law, assessments from taxing authorities, settlements with taxing authorities, and lapses of statutes of limitation. The changes in tax reserves were not significant for any of the periods presented.

In the second quarter of 2022, we recorded a $5 million charge related to our income tax reserves due to the resolution of a foreign tax settlement.  Partially offsetting this charge were tax benefits totaling $2 million from reserves releases due to various statute of limitation lapses. The changes in tax reserves were not significant for any of the prior-year periods.

During the quarter ended July 30, 2022, we also recorded a tax expense of $6 million in connection with Eastbay Team Sales divestiture, including the effect of a non-deductible goodwill write-off.

Second Quarter 2022 Form 10-Q Page 27

During the twenty-six weeks ended July 30, 2022, we recorded $1 million of expense related to tax deficiencies from share-based compensation, as compared with excess tax benefits of $1 million and $2 million in the first and second quarters of the corresponding prior-year periods, respectively.

Excluding the above-mentioned discrete items, the effective tax rates for the current year periods increased, as compared with the corresponding prior-year periods, primarily due to the change in the mix of domestic and foreign earnings.

Our effective tax rate will vary due to numerous factors, such as level and geographic mix of income and losses, acquisitions, investments, intercompany transactions, foreign currency exchange rates, our stock price, changes in our deferred tax assets and liabilities and their valuation, changes in the laws, regulations, administrative practices, principles, and interpretations related to tax, including changes to the global tax framework and other laws and accounting rules in various jurisdictions.

On August 16, 2022, President Biden signed the Inflation Reduction Act (“IRA”) of 2022 into law. The IRA contains a number of revisions to the Internal Revenue Code, including a 15% corporate minimum tax and a 1% excise tax on corporate stock repurchases in tax years beginning after December 31, 2022. We do not currently expect the IRA tax provisions will have a significant effect on our overall effective tax rate.

Liquidity and Capital Resources

Liquidity

Our primary source of liquidity has been cash flow from operations, while the principal uses of cash have been to fund inventory and other working capital requirements; finance capital expenditures related to store openings, store remodelings, internet and mobile sites, information systems, and other support facilities; make retirement plan contributions, quarterly dividend payments, and interest payments; and fund other cash requirements to support the development of our short-term and long-term operating strategies, including strategic investments. We generally finance real estate with operating leases. We believe our cash, cash equivalents, future cash flow from operations, and amounts available under our credit agreement will be adequate to fund these requirements.

The Company may also repurchase its common stock or seek to retire or purchase outstanding debt through open market purchases, privately negotiated transactions, or otherwise. Share repurchases and retirement of debt, if any, will depend on prevailing market conditions, liquidity requirements, contractual restrictions, strategic considerations, and other factors. The amounts involved may be material. As of July 30, 2022, approximately $1,103 million remained available under our current $1.2 billion share repurchase program, which was approved in February 2022. The new program does not have an expiration date.

Any material adverse change in customer demand, fashion trends, competitive market forces, or customer acceptance of our merchandise mix, retail locations and websites, uncertainties related to the effect of competitive products and pricing, our reliance on a few key suppliers for a significant portion of our merchandise purchases and risks associated with global product sourcing, economic conditions worldwide, the effects of currency fluctuations, continued uncertainties caused by the COVID-19 pandemic, as well as other factors listed under the headings “Disclosure Regarding Forward-Looking Statements,” and “Risk Factors” could affect our ability to continue to fund our needs from business operations.

Second Quarter 2022 Form 10-Q Page 28

Operating Activities

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
Net cash (used in) provided by operating activities	$	(102)	$	402
$ Change	$	(504)

Operating activities reflects net income adjusted for non-cash items and working capital changes. Adjustments to net income for non-cash items include gains, losses, impairment charges, other charges, depreciation and amortization, deferred income taxes, and share-based compensation expense.

The decrease in cash from operating activities reflected higher merchandise purchases and payments of accounts payable and accrued and other liabilities, as well as lower net income, as compared with the same period last year. Higher merchandise purchases were necessary as our year-end inventory levels were affected by the COVID-19 pandemic and the associated supply chain challenges.

As of July 30, 2022, we have withheld approximately $7 million of lease and lease-related payments as we continue to negotiate rent deferrals or abatements with our landlords for the period that our stores were closed due to the COVID-19 pandemic.

Investing Activities

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
Net cash used in investing activities	$	(113)	$	(159)
$ Change	$	46

The change in investing activities primarily reflected higher capital expenditures, partially offset by divestiture of certain assets.

For the twenty-six weeks ended July 30, 2022, capital expenditures increased by $69 million to $156 million, as compared with the corresponding prior-year period. Our full-year capital spending is expected to be $275 million. The forecast includes $191 million related to the remodeling or relocation of approximately 140 existing stores and the opening of approximately 110 new stores, as well as $84 million for the development of information systems, websites, and infrastructure, including supply chain initiatives.

During the twenty-six weeks ended July 30, 2022, we paid an additional $12 million for the WSS and atmos acquisitions upon the satisfaction of certain post-closing conditions.

We have invested $4 million in minority investments during the current year, including various limited partner venture capital funds managed by Black fund managers, who are committed to advancing diverse-led businesses as part of our Leading in Education and Economic Development (LEED) initiative. During the second quarter of 2022, we sold our position in one of our minority investments receiving proceeds of $12 million. In the prior-year period, we invested $68 million in a public entity, Retailors Ltd., and $10 million in minority investments primarily related to LEED.

Also during the second quarter of 2022, we sold our Eastbay Team Sales business receiving proceeds of $47 million and resulting in a gain of $18 million.

We sold the former Runners Point headquarters in the first quarter of 2021, generating proceeds of $3 million. Also last year, we received insurance proceeds of $3 million related to property and equipment claims from the social unrest losses in 2020.

Second Quarter 2022 Form 10-Q Page 29

Financing Activities

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
Net cash used in financing activities	$	(199)	$	(79)
$ Change	$	(120)

Cash used in financing activities was driven by our return to shareholders initiatives, including our share repurchase program and cash dividends, as follows:

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
Share repurchases	$	129	$	41
Dividends paid on common stock		76		42
Total returned to shareholders	$	205	$	83

During the twenty-six weeks ended July 30, 2022, we repurchased 4,050,000 shares of common stock for $129 million under our share repurchase programs, whereas in the prior year we spent $41 million to repurchase shares. We also declared and paid $76 million in dividends representing a quarterly rate of $0.40 per share in 2022, as compared with a quarterly rate of $0.20 per share in the prior-year period.

We paid $1 million to satisfy tax withholding obligations relating to the vesting of share-based equity awards during the twenty-six  weeks ended July 30, 2022, as compared with $11 million in 2021. Offsetting this amount were proceeds received in connection with employee stock programs of $6 million in the current year, as compared with $17 million in the prior-year period.

Additionally, we paid $3 million of principal on our finance lease obligations, mainly related to certain WSS stores.

Critical Accounting Policies and Estimates

There have been no significant changes to our critical accounting policies and estimates from the information provided in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in the 2021 Form 10-K.

Recent Accounting Pronouncements

Descriptions of the recently issued and adopted accounting principles are included in Item 1. “Financial Statements” in Note 1, Summary of Significant Accounting Policies, to the Condensed Consolidated Financial Statements.

Item 4. Controls and Procedures

During the quarter, the Company’s management performed an evaluation, under the supervision and with the participation of the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). Based on that evaluation, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures were effective to ensure that information relating to the Company that is required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC rules and forms, and is accumulated and communicated to management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure.

Second Quarter 2022 Form 10-Q Page 30

During the quarter ended July 30, 2022, there were no changes, other than process changes that may be necessary related to the newly acquired businesses, in the Company’s internal control over financial reporting (as defined in Rules 13a-15(f) of the Exchange Act), that materially affected or are reasonably likely to affect the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

Information regarding the Company’s legal proceedings is contained in the Legal Proceedings note under Item 1. “Financial Statements” in Part I.

Item 1A. Risk Factors

In addition to the other information discussed in this report, the factors described in Part I, Item 1A. “Risk Factors” in our 2021 Annual Report on Form 10-K filed with the SEC on March 24, 2022 should be considered as they could materially affect our business, financial condition, or future results.

There have not been any significant changes with respect to the risks described in our 2021 Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The table below provides information with respect to shares of the Company’s common stock for the thirteen weeks ended July 30, 2022.

				Total Number of		Dollar Value of
	Total	Average		Shares Purchased as		Shares that may
	Number	Price		Part of Publicly		yet be Purchased
	of Shares	Paid Per		Announced		Under the
Date Purchased	Purchased (1)	Share (1)		Program (2)		Program (2)
May 1 to May 28, 2022	—	$	—	—	$	1,143,322,902
May 29 to July 2, 2022	1,405,235		28.22	1,400,000		1,103,814,042
July 3 to July 30, 2022	549		26.97	—		1,103,814,042
	1,405,784	$	28.22	1,400,000

(1) These columns include shares acquired in satisfaction of the tax withholding obligations of holders of restricted stock unit awards, which vested during the quarter. The calculation of the average price paid per share includes all fees, commissions, and other costs associated with the repurchase of such shares.

(2) On February 24, 2022, the Board of Directors approved a new $1.2 billion share repurchase program. The new program does not have an expiration date.

Second Quarter 2022 Form 10-Q Page 31

Item 6. Exhibits

Exhibit No.	Description
10.1 †	Letter Agreement, by and between the Company and Richard A. Johnson, dated August 17, 2022 (incorporated herein by reference to Exhibit 10.1 to the Current Report on Form 8-K dated August 16, 2022 filed on August 19, 2022).
10.2 †	Employment Agreement, by and between the Company and Mary N. Dillon, dated August 16, 2022 (incorporated herein by reference to Exhibit 10.2 to the Current Report on Form 8-K dated August 16, 2022 filed on August 19, 2022).
10.3 †	Form of Restricted Stock Unit Inducement Award Agreement, by and between the Company and Mary N. Dillon (incorporated herein by reference to Exhibit 99.1 to the Registration Statement on Form S-8 (Registration No. 333-267044) filed on August 24, 2022).
10.4 †	Form of Performance Stock Unit Inducement Award Agreement (Transformation Award), by and between the Company and Mary N. Dillon (incorporated herein by reference to Exhibit 99.2 to the Registration Statement on Form S-8 (Registration No. 333-267044) filed on August 24, 2022).
10.5 †	Form of Nonstatutory Stock Option Inducement Award Agreement (Annual Award), by and between the Company and Mary N. Dillon (incorporated herein by reference to Exhibit 99.3 to the Registration Statement on Form S-8 (Registration No. 333-267044) filed on August 24, 2022).
10.6 †	Form of Restricted Stock Unit Inducement Award Agreement (Annual Award), by and between the Company and Mary N. Dillon (incorporated herein by reference to Exhibit 99.4 to the Registration Statement on Form S-8 (Registration No. 333-267044) filed on August 24, 2022).
10.7 †	Form of Performance Stock Unit Inducement Award Agreement (Annual Award), by and between the Company and Mary N. Dillon (incorporated herein by reference to Exhibit 99.5 to the Registration Statement on Form S-8 (Registration No. 333-267044) filed on August 24, 2022).
10.8 †	Letter Agreement, by and between the Company and W. Scott Martin, dated July 11, 2022 (incorporated herein by reference to Exhibit 99.1 to the Current Report on Form 8-K dated July 11, 2022 filed on July 15, 2022).
15*	Accountants’ Acknowledgement.
31.1*	Certification of Chief Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification of Chief Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32**	Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99*	Report of Independent Registered Public Accounting Firm.
101.INS*	Inline XBRL Instance Document.
101.SCH*	Inline XBRL Taxonomy Extension Schema.
101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase.
101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase.
101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase.
101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase.
104*	Cover Page Interactive Data File (embedded within the Inline XBRL datafile).

†   Management contract or compensatory plan or arrangement

*    Filed herewith

**   Furnished herewith

Second Quarter 2022 Form 10-Q Page 32

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: September 7, 2022	FOOT LOCKER, INC.
	/s/ Andrew E. Page
	ANDREW E. PAGE
	Executive Vice President and Chief Financial Officer

Second Quarter 2022 Form 10-Q Page 33

EX-15

Exhibit 15

ACCOUNTANT’S ACKNOWLEDGEMENT

The Board of Directors of
Foot Locker, Inc.:

We acknowledge our awareness of the use therein of our report dated September 7, 2022 related to our review of interim financial information in the following Registration Statements:

- Form S-8 No. 33-10783

- Form S-8 No. 33-91888

- Form S-8 No. 33-91886

- Form S-8 No. 33-97832

- Form S-8 No. 333-07215

- Form S-8 No. 333-21131

- Form S-8 No. 333-62425

- Form S-8 No. 333-33120

- Form S-8 No. 333-41056

- Form S-8 No. 333-41058

- Form S-8 No. 333-74688

- Form S-8 No. 333-99829

- Form S-8 No. 333-111222

- Form S-8 No. 333-121515

- Form S-8 No. 333-144044

- Form S-8 No. 333-149803

- Form S-3 No. 33-43334

- Form S-3 No. 33-86300

- Form S-3 No. 333-64930

- Form S-8 No. 333-167066

- Form S-8 No. 333-171523

- Form S-8 No. 333-190680

- Form S-8 No. 333-196899

- Form S-8 No. 333-267044

Pursuant to Rule 436 under the Securities Act of 1933 (the Act), such report is not considered part of a registration statement prepared or certified by an independent registered public accounting firm, or a report prepared or certified by an independent registered public accounting firm within the meaning of Sections 7 and 11 of the Act.

/s/ KPMG LLP

New York, New York

September 7, 2022

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Mary N. Dillon, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Foot Locker, Inc. (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the Audit Committee of the Registrant’s Board of Directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

September 7, 2022
	/s/ Mary N. Dillon
	Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Andrew E. Page, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Foot Locker, Inc. (the “Registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;

4. The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:

a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and

5. The Registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the Audit Committee of the Registrant’s Board of Directors (or persons performing the equivalent functions):

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.

September 7, 2022
	/s/ Andrew E. Page
	Chief Financial Officer

EX-32

Exhibit 32

FOOT LOCKER, INC.

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of Foot Locker, Inc. (the “Registrant”) for the quarterly period ended July 30, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Mary N. Dillon, as Chief Executive Officer of the Registrant and Andrew E. Page, as Chief Financial Officer of the Registrant, each hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)  The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)  The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

Dated: September 7, 2022
	/s/ Mary N. Dillon
	Mary N. Dillon
	Chief Executive Officer
	/s/ Andrew E. Page
	Andrew E. Page
	Chief Financial Officer

The foregoing certification is being furnished solely pursuant to 18 U.S.C. § 1350 and is not being filed as part of the Report or as a separate disclosure document. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the company specifically incorporates it by reference.

EX-99

Exhibit 99

Report of Independent Registered Public Accounting Firm

To the Shareholders and Board of Directors
Foot Locker, Inc.:

Results of Review of Interim Financial Information

We have reviewed the condensed consolidated balance sheets of Foot Locker, Inc. and subsidiaries (the Company) as of July 30, 2022 and July 31, 2021, the related condensed consolidated statements of operations, comprehensive income, and changes in shareholders’ equity for the thirteen and twenty-six week periods ended July 30, 2022 and July 31, 2021, the related condensed consolidated statements of cash flows for the twenty-six week periods ended July 30, 2022 and July 31, 2021, and the related notes (collectively, the consolidated interim financial information). Based on our reviews, we are not aware of any material modifications that should be made to the consolidated interim financial information for it to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of January 29, 2022, and the related consolidated statements of operations, comprehensive income, changes in shareholders’ equity, and cash flows for the year then ended (not presented herein); and in our report dated March 24, 2022, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of January 29, 2022, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

This consolidated interim financial information is the responsibility of the Company’s management. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our reviews in accordance with the standards of the PCAOB. A review of consolidated interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

/s/ KPMG LLP

New York, New York
September 7, 2022

XML

Document And Entity Information - shares	6 Months Ended
	Jul. 30, 2022	Aug. 26, 2022
Document And Entity Information [Abstract]
Document Type	10-Q
Document Period End Date	Jul. 30, 2022
Entity File Number	1-10299
Entity Registrant Name	FOOT LOCKER, INC.
Entity Incorporation, State or Country Code	NY
Entity Tax Identification Number	13-3513936
Entity Address, Address Line One	330 West 34th Street
Entity Address, City or Town	New York
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	10001
City Area Code	212
Local Phone Number	720-3700
Title of 12(b) Security	Common Stock
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		93,301,646
Entity Central Index Key	0000850209
Current Fiscal Year End Date	--01-28
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Amendment Flag	false
Trading Symbol	FL
Entity Interactive Data Current	Yes
Document Quarterly Report	true
Document Transition Report	false

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jul. 30, 2022	Jan. 29, 2022	[1]	Jul. 31, 2021
Current assets:
Cash and cash equivalents	$ 386	$ 804		$ 1,845
Merchandise inventories	1,644	1,266		1,081
Other current assets	285	293		252
Assets, current, total	2,315	2,363		3,178
Property and equipment, net	899	917		743
Operating lease right-of-use assets	2,526	2,616		2,569
Deferred taxes	74	86		108
Goodwill	773	797		158
Other intangible assets, net	432	454		16
Minority investments	736	781		728
Other assets	113	121		85
Total assets	7,868	8,135		7,585
Current liabilities:
Accounts payable	596	596		539
Accrued and other liabilities	435	561		474
Current portion of obligations under finance leases	6	6		102
Operating lease liabilities classified as current	548	572		566
Liabilities, current, total	1,585	1,735		1,681
Long-term debt and obligations under finance leases	449	451		10
Long-term lease obligations	2,287	2,363		2,363
Other liabilities	330	343		190
Total liabilities	4,651	4,892		4,244
Shareholders' equity:
Common stock and paid-in capital: 99,319,014; 104,515,702; and 99,070,796 shares issued, respectively	788	770		799
Retained earnings	3,051	2,900		2,916
Accumulated other comprehensive loss	(416)	(343)		(338)
Less: Treasury stock at cost: 6,018,197; 714,490; and 2,050,000 shares, respectively	(213)	(88)		(41)
Noncontrolling interest	7	4		5
Total shareholders' equity	3,217	3,243		3,341
Liabilities and equity, total	$ 7,868	$ 8,135		$ 7,585

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares	Jul. 30, 2022	Jan. 29, 2022	Jul. 31, 2021
CONSOLIDATED BALANCE SHEETS [Abstract]
Common Stock, Shares Outstanding, Issued, Total	99,319,014	99,070,796	104,515,702
Treasury Stock, Shares	6,018,197	2,050,000	714,490

XML

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract]
Sales	$ 2,065	$ 2,275	$ 4,240	$ 4,428
Cost of sales	1,411	1,477	2,846	2,881
Selling, general and administrative expenses	452	450	915	868
Depreciation and amortization	51	48	105	93
Impairment and other charges	12	36	18	40
Income from operations	139	264	356	546
Interest (expense) income, net	(5)	(2)	(10)	(4)
Other (expense) / income, net	9	325	(13)	329
Income before income taxes	143	587	333	871
Income tax expense	49	157	107	239
Net Income	94	430	226	632
Net loss attributable to noncontrolling interests			1
Net income attributable to Foot Locker, Inc.	$ 94	$ 430	$ 227	$ 632
Basic earnings per share	$ 1.00	$ 4.14	$ 2.39	$ 6.10
Weighted-average shares outstanding	94.1	103.8	95.1	103.7
Diluted earnings per share	$ 0.99	$ 4.09	$ 2.36	$ 6.02
Weighted-average shares outstanding, assuming dilution	95.1	105.2	96.1	105.1

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract]
Net income attributable to Foot Locker, Inc.	$ 94	$ 430	$ 227	$ 632
Foreign currency translation adjustment:
Translation adjustment arising during the period, net of income tax (benefit)/expense of $-, $-, $(1) and $1, respectively	(31)	(14)	(75)	(10)
Cash flow hedges:
Change in fair value of derivatives, net of income tax benefit of $-, $-, $-, and $-, respectively	(3)		(2)
Pension and postretirement adjustments:
Amortization of net actuarial gain/loss and prior service cost included in net periodic benefit costs, net of income tax expense of $-, $-, $1 and $1, respectively	2	2	4	3
Comprehensive income (loss)	$ 62	$ 418	$ 154	$ 625

XML

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract]
Net income tax benefit on translation adjustment	$ 0	$ 0	$ (1)	$ 1
Change in fair value of derivatives, income tax benefit	0	0	0	0
Amortization of net actuarial gain/loss and prior service cost included in net periodic benefit costs, income tax expense	$ 0	$ 0	$ 1	$ 1

XML

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) $ in Millions	Additional Paid-In Capital & Common Stock	Treasury Stock [Member]	Retained Earnings	Accumulated Other Comprehensive Loss [Member]	Noncontrolling Interest [Member]	Total
Cumulative effect of the adoption new ASUs	$ 779	$ (3)	$ 2,326	$ (331)	$ 5	$ 2,776
Beginning Balance at Jan. 30, 2021	$ 779	$ (3)	2,326	(331)	5	2,776
Beginning Balance (in shares) at Jan. 30, 2021	103,693,000
Beginning Balance (in treasury shares) at Jan. 30, 2021		(74,000)
Restricted stock issued (in shares)	479,000
Issued under director and stock plans	$ 11					11
Issued under director and stock plans (in shares)	344,000
Share-based compensation expense	$ 16					16
Shares of common stock used to satisfy tax withholding obligations		$ (11)				(11)
Shares of common stock used to satisfy tax withholding obligations (in shares)		(195,000)
Share repurchases		$ (41)				(41)
Share repurchases (in shares)		(746,000)
Reissued - employee stock purchase plan	(7)	$ 14				7
Reissued - employee stock purchase plan (in shares)		301,000
Net income			632			632
Cash dividends declared on common stock			(42)			(42)
Translation adjustment, net of tax				(10)		(10)
Pension and postretirement adjustments, net of tax				3		3
Ending Balance at Jul. 31, 2021	$ 799	$ (41)	2,916	(338)	5	$ 3,341
Ending Balance (in shares) at Jul. 31, 2021	104,516,000					104,515,702
Ending Balance (in treasury shares) at Jul. 31, 2021		(714,000)				(714,490)
Cumulative effect of the adoption new ASUs	$ 791	$ (47)	2,507	(326)	5	$ 2,930
Beginning Balance at May. 01, 2021	$ 791	$ (47)	2,507	(326)	5	2,930
Beginning Balance (in shares) at May. 01, 2021	104,286,000
Beginning Balance (in treasury shares) at May. 01, 2021		(887,000)
Restricted stock issued (in shares)	11,000
Issued under director and stock plans	$ 7					7
Issued under director and stock plans (in shares)	219,000
Share-based compensation expense	$ 8					8
Shares of common stock used to satisfy tax withholding obligations		$ (1)				(1)
Shares of common stock used to satisfy tax withholding obligations (in shares)		(3,000)
Share repurchases		$ (7)				(7)
Share repurchases (in shares)		(125,000)
Reissued - employee stock purchase plan	(7)	$ 14				7
Reissued - employee stock purchase plan (in shares)		301,000
Net income			430			430
Cash dividends declared on common stock			(21)			(21)
Translation adjustment, net of tax				(14)		(14)
Pension and postretirement adjustments, net of tax				2		2
Ending Balance at Jul. 31, 2021	$ 799	$ (41)	2,916	(338)	5	$ 3,341
Ending Balance (in shares) at Jul. 31, 2021	104,516,000					104,515,702
Ending Balance (in treasury shares) at Jul. 31, 2021		(714,000)				(714,490)
Cumulative effect of the adoption new ASUs	$ 799	$ (41)	2,916	(338)	5	$ 3,341
Cumulative effect of the adoption new ASUs	770	(88)	2,900	(343)	4	3,243	[1]
Beginning Balance at Jan. 29, 2022	$ 770	$ (88)	2,900	(343)	4	$ 3,243	[1]
Beginning Balance (in shares) at Jan. 29, 2022	99,071,000					99,070,796
Beginning Balance (in treasury shares) at Jan. 29, 2022		(2,050,000)				(2,050,000)
Restricted stock issued (in shares)	111,000
Issued under director and stock plans	$ 4					$ 4
Issued under director and stock plans (in shares)	137,000
Share-based compensation expense	$ 16					16
Shares of common stock used to satisfy tax withholding obligations		$ (1)				(1)
Shares of common stock used to satisfy tax withholding obligations (in shares)		(38,000)
Share repurchases		$ (129)				(129)
Share repurchases (in shares)		(4,050,000)
Reissued - employee stock purchase plan	(2)	$ 5				3
Reissued - employee stock purchase plan (in shares)		120,000
Noncontrolling interest capital contribution					4	4
Net income			227		(1)	226
Cash dividends declared on common stock			(76)			(76)
Translation adjustment, net of tax				(75)		(75)
Change in cash flow hedges, net of tax				(2)		(2)
Pension and postretirement adjustments, net of tax				4		4
Ending Balance at Jul. 30, 2022	$ 788	$ (213)	3,051	(416)	7	$ 3,217
Ending Balance (in shares) at Jul. 30, 2022	99,319,000					99,319,014
Ending Balance (in treasury shares) at Jul. 30, 2022		(6,018,000)				(6,018,197)
Cumulative effect of the adoption new ASUs	$ 779	$ (178)	2,995	(384)	3	$ 3,215
Beginning Balance at Apr. 30, 2022	$ 779	$ (178)	2,995	(384)	3	3,215
Beginning Balance (in shares) at Apr. 30, 2022	99,233,000
Beginning Balance (in treasury shares) at Apr. 30, 2022		(4,732,000)
Restricted stock issued (in shares)	23,000
Issued under director and stock plans	$ 2					2
Issued under director and stock plans (in shares)	63,000
Share-based compensation expense	$ 9					9
Shares of common stock used to satisfy tax withholding obligations (in shares)		(6,000)
Share repurchases		$ (40)				(40)
Share repurchases (in shares)		(1,400,000)
Reissued - employee stock purchase plan	(2)	$ 5				3
Reissued - employee stock purchase plan (in shares)		120,000
Noncontrolling interest capital contribution					4	4
Net income			94			94
Cash dividends declared on common stock			(38)			(38)
Translation adjustment, net of tax				(31)		(31)
Change in cash flow hedges, net of tax				(3)		(3)
Pension and postretirement adjustments, net of tax				2		2
Ending Balance at Jul. 30, 2022	$ 788	$ (213)	3,051	(416)	7	$ 3,217
Ending Balance (in shares) at Jul. 30, 2022	99,319,000					99,319,014
Ending Balance (in treasury shares) at Jul. 30, 2022		(6,018,000)				(6,018,197)
Cumulative effect of the adoption new ASUs	$ 788	$ (213)	$ 3,051	$ (416)	$ 7	$ 3,217

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Statement of Stockholders' Equity [Abstract]
Cash dividends declared on common stock, per share	$ 0.40	$ 0.20	$ 0.80	$ 0.40

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021
From operating activities:
Net income	$ 226	$ 632
Adjustments to reconcile net income to net cash provided by operating activities:
Non-cash impairment and other charges	5	45
Fair value adjustments to minority investments	38	(314)
Depreciation and amortization	105	93
Deferred income taxes	8	67
Share-based compensation expense	16	16
Gain on disposal of business	(18)
Change in assets and liabilities:
Merchandise inventories	(413)	(163)
Accounts payable	10	139
Accrued and other liabilities	(69)	(12)
Insurance receivable for inventory loss		8
Other, net	(10)	(109)
Net cash (used in) provided by operating activities	(102)	402
From investing activities:
Capital expenditures	(156)	(87)
Purchase of business, net of cash acquired	(12)
Minority investments	(4)	(78)
Proceeds from sale of business	47
Proceeds from minority investments	12
Proceeds from sale of property		3
Insurance proceeds related to loss on property and equipment		3
Net cash used in investing activities	(113)	(159)
From financing activities:
Purchase of treasury shares	(129)	(41)
Dividends paid on common stock	(76)	(42)
Payment of obligations under finance leases	(3)	(1)
Shares of common stock repurchased to satisfy tax withholding obligations	(1)	(11)
Treasury stock reissued under employee stock plan	3	7
Proceeds from exercise of stock options	3	10
Contribution from non-controlling interest	4
Repayment of the revolving credit facility		(1)
Net cash used in financing activities	(199)	(79)
Effect of exchange rate fluctuations on cash, cash equivalents, and restricted cash	(5)	(1)
Net change in cash, cash equivalents, and restricted cash	(419)	163
Cash, cash equivalents, and restricted cash at beginning of year	850	1,718
Cash, cash equivalents, and restricted cash at end of period	431	1,881
Cash paid during the year:
Interest	8	6
Income taxes	103	229
Cash paid for amounts included in measurement of operating lease liabilities:	354	358
Non-cash investing and financing activities:
Right-of-use assets obtained in exchange for lease obligations:	277	171
Assets obtained in exchange for finance lease obligations	$ 1	$ 4

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Summary of Significant Accounting Policies

6 Months Ended

Jul. 30, 2022

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements contained in this report are unaudited. In the opinion of management, the condensed consolidated financial statements include all normal, recurring adjustments necessary for a fair presentation of the results for the interim periods presented. As used in these Notes to the Unaudited Condensed Consolidated Financial Statements, the terms “Foot Locker,” “Company,” “we,” “our,” and “us” refer to Foot Locker, Inc. and its consolidated subsidiaries.

The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the amounts reported in the accompanying Unaudited Condensed Consolidated Financial Statements and these Notes and related disclosures. Actual results may differ from those estimates. The results of operations for any interim period are not necessarily indicative of the results expected for the year.

The results of operations for the period ended July 30, 2022 are not necessarily indicative of the results to be expected for the full fiscal year due to the continued uncertainty of general economic conditions that may affect us for the remainder of 2022.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Notes to Consolidated Financial Statements contained in our 2021 Form 10-K.

There were no significant changes to the policies disclosed in Note 1, Summary of Significant Accounting Policies of our 2021 Form 10-K.

Recent Accounting Pronouncements

Recently issued accounting pronouncements did not, or are not believed by management to, have a material effect on our present or future consolidated financial statements.

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Acquisition

6 Months Ended

Jul. 30, 2022

Business Combinations [Abstract]

Acquisition

2. Acquisitions

In 2021, we acquired WSS and atmos, two businesses that will allow us to further differentiate our product offerings, as well as our customer base, and diversify our retail store and omnichannel portfolio.

WSS

During the twenty-six weeks ended July 30, 2022, we paid an additional $4 million upon the finalization of the value of net assets acquired, with a corresponding increase to goodwill as compared with the amounts presented in the most recent annual report. The aggregate purchase price for the acquisition has increased to $811 million ($741 million, net of cash acquired). There were no additional payments or changes to the value of net assets acquired in the thirteen weeks ended July 30, 2022.

2. Acquisitions (continued)

The following table represents the final allocation of the purchase price for WSS.

($ in millions)
Assets acquired:
Cash and cash equivalents	$	70
Merchandise inventories		82
Other current assets		10
Property and equipment, net		133
Operating lease right-of-use assets		143
Tradenames		296
Customer relationships		13
Other assets		4
Liabilities assumed:
Accounts payable	$	(58)
Current portion of obligations under finance leases		(3)
Current portion of lease obligations		(19)
Long-term portion of obligations under finance leases		(50)
Long-term lease obligations		(127)
Deferred taxes		(84)
Other liabilities		(4)
Goodwill		405
Total purchase price	$	811

atmos

During the thirteen and twenty-six weeks ended July 30, 2022, we paid an additional $5 million and $8 million, respectively, in connection with the finalization of certain post-closing conditions. The aggregate purchase price for the acquisition has increased to $368 million, subject to adjustment for the finalization of the value of net assets acquired and other post-closing matters. The preliminary purchase price includes contingent consideration initially measured at $35 million, which can reach up to $111 million based on achieving certain revenue growth and EBITDA performance targets. The fair value of the contingent consideration has not changed from the initial measurement. The preliminary purchase price does not yet reflect the finalization of the net working capital provisions and other post-closing adjustments. At closing, we placed $30 million in escrow, and an additional $6 million will be payable if certain post-closing conditions are satisfied. We expect to finalize the remaining amounts by the end of this fiscal year.

The following table represents the preliminary allocation of the purchase price for atmos and includes fair value adjustments to certain assets and liabilities since our most recent annual report. Changes to amounts reported at year end and the previous quarter included an $8 million increase in goodwill due to the additional purchase price, revised downward valuation of the tradenames and the addition of the customer list intangible. The adjustments did not have a significant effect on the consolidated results of operations. We determined that the atmos tradenames will have an indefinite life and will not be amortized.

We are assessing the tax deductibility of the goodwill related to the acquisition.

2. Acquisitions (continued)

The following table represents the preliminary allocation of the purchase price for atmos.

($ in millions)
Assets acquired:
Cash and cash equivalents	$	6
Merchandise inventories		22
Other current assets		12
Property and equipment, net		7
Operating lease right-of-use assets		44
Tradenames		130
Customer relationships		9
Other assets		6
Liabilities assumed:
Accounts payable	$	(10)
Current portion of lease obligations		(10)
Other current liabilities		(8)
Long-term lease obligations		(35)
Deferred taxes		(44)
Other liabilities		(8)
Goodwill (1)		247
Total purchase price (2)	$	368

(1) Goodwill represented on this table is at the exchange rate in effect as of the date of acquisition.

(2) Total purchase price consists of $333 million in cash and $35 million of contingent consideration.

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Revenue

6 Months Ended

Jul. 30, 2022

Revenue [Abstract]

Revenue

3. Revenue

The table below presents sales disaggregated based upon sales channel. Sales are attributable to the channel in which the sales transaction is initiated.

		Thirteen weeks ended			Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales by Channel
Stores	$	1,716	$	1,817	$	3,492	$	3,437
Direct-to-customers		349		458		748		991
Total sales	$	2,065	$	2,275	$	4,240	$	4,428

Sales disaggregated based upon geographic area are presented in the table below. Sales are attributable to the geographic area in which the sales transaction is fulfilled.

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales by Geography
United States	$	1,383	$	1,623	$	2,923	$	3,336
International		682		652		1,317		1,092
Total sales	$	2,065	$	2,275	$	4,240	$	4,428

3. Revenue (continued)

Contract Liabilities

We sell gift cards, which do not have expiration dates. Revenue from gift card sales is recorded when the gift cards are redeemed by customers. Breakage income is recognized as revenue in proportion to the pattern of rights exercised by the customer. The table below presents the activity of our gift card liability balance.

	July 30,		July 31,
($ in millions)	2022		2021
Gift card liability at beginning of year	$	46	$	41
Redemptions		(120)		(122)
Breakage recognized in sales		(8)		(9)
Activations		115		128
Foreign currency fluctuations		(1)		—
Gift card liability	$	32	$	38

We elected not to disclose the information about remaining performance obligations since the amount of gift cards redeemed after 12 months is not significant.

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Segment Information

6 Months Ended

Jul. 30, 2022

Segment Information [Abstract]

Segment Information

4. Segment Information

We have integrated all available shopping channels including stores, websites, apps, and social channels. Store sales are primarily fulfilled from the store’s inventory, but may also be shipped from any of our distribution centers or from a different store location if an item is not available at the original store. Direct-to-customer orders are generally shipped to our customers through our distribution centers but may also be shipped from any store or a combination of our distribution centers and stores depending on availability.

We evaluate performance based on several factors, primarily the banner’s financial results, referred to as division profit. Division profit reflects income before income taxes, impairment and other charges, corporate expense, non-operating income, and net interest expense.

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales	$	2,065	$	2,275	$	4,240	$	4,428
Operating Results
Division profit		184		332	$	444	$	647
Less: Impairment and other charges (1)		12		36		18		40
Less: Corporate expense (2)		33		32		70		61
Income from operations		139		264		356		546
Interest expense, net		(5)		(2)		(10)		(4)
Other income / (expense), net (3)		9		325		(13)		329
Income before income taxes	$	143	$	587	$	333	$	871

(1) See Note 5, Impairment and Other Charges for further detail.

(2) Corporate expense consists of unallocated selling, general and administrative expenses, as well as depreciation and amortization related to our corporate headquarters, centrally managed departments, unallocated insurance and benefit programs, certain foreign exchange transaction gains and losses, and other items.  

(3) Other income / (expense), net for the thirteen weeks and twenty-six weeks ended July 30, 2022 represented primarily the loss on the change in fair value of our investment in Retailors, Ltd., a publicly-listed entity, which was partially offset by other income. See Note 6, Other Income / (Expense), net.

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Impairment and Other Charges

6 Months Ended

Jul. 30, 2022

Impairment and Other Charges [Abstract]

Impairment and Other Charges

5. Impairment and Other Charges

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Transformation consulting	$	9	$	—	$	10	$	—
Impairment of long-lived assets and right-of-use assets		2		39		5		39
Acquisition and integration costs		1		—		3		—
Lease termination costs		—		4		—		4
Impairment of investments		—		—		—		2
Reorganization costs		—		—		—		2
Insurance recovery		—		(7)		—		(7)
Total impairment and other charges	$	12	$	36	$	18	$	40

For the thirteen and twenty-six weeks ended July 30, 2022, we incurred $9 million and $10 million of transformation consulting expense, respectively. We recorded impairment charges of $2 million and $5 million related to long-lived assets and right-of-use assets, as well as accelerated tenancy charges for the thirteen and twenty-six weeks ended July 30, 2022, respectively. Additionally, we recorded $1 million and $3 million in acquisition and integration costs related to WSS and atmos for the thirteen and twenty-six weeks ended July 30, 2022, respectively.

For the thirteen and twenty-six weeks ended July 31, 2021, we recorded impairment charges of $39 million, related to the decision to exit the Footaction banner. For the thirteen and twenty-six weeks ended July 31, 2021, we recorded charges of $4 million in lease-related termination costs, offset by $7 million of insurance recovery income related to 2020 social unrest losses. For the twenty-six weeks ended July 31, 2021, we recorded an impairment charge of $2 million related to the underperformance of one of our minority investments, and a severance charge of $2 million in connection with the reorganization of certain support functions.

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Other Income (Expense), net

6 Months Ended

Jul. 30, 2022

Other Income [Abstract]

Other Income (Expense), net

6. Other Income / (Expense), net

Effective June 27, 2022, the Company reached a definitive agreement to sell all assets related to the Eastbay Team Sales business, consisting primarily of inventory and accounts receivable. We received proceeds of $47 million from the transaction, resulting in a gain of $18 million, reported in other income / (expense), net.

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Cash, Cash Equivalents, and Restricted Cash

6 Months Ended

Jul. 30, 2022

Restricted Cash [Abstract]

Cash, Cash Equivalents, and Restricted Cash

7. Cash, Cash Equivalents, and Restricted Cash

The table below provides a reconciliation of cash and cash equivalents, as reported on our Condensed Consolidated Balance Sheets, to cash, cash equivalents, and restricted cash, as reported on our Condensed Consolidated Statements of Cash Flows.

	July 30,		July 31,
($ in millions)	2022		2021
Cash and cash equivalents	$	386	$	1,845
Restricted cash included in other current assets		7		7
Restricted cash included in other non-current assets		38		29
Cash, cash equivalents, and restricted cash	$	431	$	1,881

Amounts included in restricted cash primarily relate to amounts held in escrow in connection with various leasing arrangements in Europe and deposits held in insurance trusts to satisfy the requirement to collateralize part of the self-insured workers’ compensation and liability claims.

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Goodwill

6 Months Ended

Jul. 30, 2022

Goodwill and Other Intangible Assets, Net [Abstract]

Goodwill

8. Goodwill

See footnote 2, Acquisitions, for additional information on our recent acquisitions.

In conjunction with the sale of the Eastbay Team Sales business, we allocated $6 million of goodwill to the assets sold, representing the allocable share of the fair value of the reporting unit disposed of.

We review goodwill for impairment annually during the first quarter of each fiscal year, or more frequently if impairment indicators arise. The review of impairment consists of either using a qualitative approach to determine whether it is more likely than not that the fair value of the assets is less than their respective carrying values or a one-step quantitative impairment test. The results of the first quarter analysis did not result in an impairment since the fair value of each reporting unit exceeded its carrying value.

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Accumulated Other Comprehensive Loss

6 Months Ended

Jul. 30, 2022

Accumulated Other Comprehensive Loss [Abstract]

Comprehensive Income (Loss) Note [Text Block]

10. Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss (“AOCL”), net of tax, is comprised of the following:

	July 30,		July 31,		January 29,
($ in millions)	2022		2021		2022
Foreign currency translation adjustments	$	(182)	$	(74)	$	(107)
Hedge contracts		(2)		(1)		—
Unrecognized pension cost and postretirement benefit		(232)		(263)		(236)
	$	(416)	$	(338)	$	(343)

The changes in AOCL for the twenty-six weeks ended July 30, 2022 were as follows:

	Foreign				Items Related
	Currency				to Pension and
	Translation				Postretirement
($ in millions)	Adjustments		Hedges		Benefits		Total
Balance as of January 29, 2022	$	(107)		—	$	(236)	$	(343)
OCI before reclassification		(75)		2		—		(73)
Reclassification of hedges, net of tax		—		(4)		—		(4)
Amortization of pension actuarial loss, net of tax		—		—		4		4
Other comprehensive income		(75)		(2)		4		(73)
Balance as of July 30, 2022	$	(182)	$	(2)	$	(232)	$	(416)

Reclassifications from AOCL for the twenty-six weeks ended July 30, 2022 were as follows:

($ in millions)
Reclassification of hedge loss:
Cross-currency swap	$	(4)
Income tax		—
Reclassification of hedges, net of tax	$	(4)
Amortization of actuarial loss:
Pension benefits	$	5
Income tax benefit		(1)
Amortization of actuarial loss, net of tax	$	4
Total, net of tax	$	—

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Other Intangible Assets, Net

6 Months Ended

Jul. 30, 2022

Goodwill and Other Intangible Assets, Net [Abstract]

Other Intangible Assets, Net

9. Other Intangible Assets, net

The components of finite-lived intangible assets and intangible assets not subject to amortization are as follows:

		July 30, 2022						July 31, 2021
	Gross		Accum.		Net		Gross		Accum.		Net
($ in millions)	value		amort.		value		value		amort.		value
Amortized intangible assets: (1)
Lease acquisition costs	$	97	$	(95)	$	2	$	116	$	(112)	$	4
Trademarks/tradenames (2)		18		(18)		—		20		(17)		3
Customer lists		20		(5)		15		—		—		—
	$	135	$	(118)	$	17	$	136	$	(129)	$	7
Indefinite life intangible assets: (1)
Trademarks/tradenames					$	415					$	9
Other intangible assets, net					$	432					$	16

(1) The change in the ending balances also reflects the effect of foreign currency fluctuations due primarily to movements of the euro in relation to the U.S. dollar.

(2) During the fourth quarter of 2021, we recorded a non-cash impairment charge related to the Footaction tradename.  

In connection with the acquisitions of WSS and atmos, we recognized indefinite life intangible assets of $296 million for WSS related tradenames and $130 million for atmos related tradenames. Additionally, we recognized customer list intangible assets of $13 million for WSS and $9 million for atmos, both of which will be amortized over 3 years. The intangibles related to atmos were originally recorded at the exchange rate in effect as of the date of acquisition and are presented in the above table at current period exchange rates. Amortizing intangible assets primarily represent the WSS and atmos customer lists, and lease acquisition costs, which are amounts that are required to secure prime lease locations and other lease rights, primarily in Europe.

Amortization expense recorded is as follows:

	Thirteen weeks ended					Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Amortization expense	$	2	$	1	$	5	$	2

9. Other Intangible Assets, net (continued)

Estimated future amortization expense for finite-life intangible assets is as follows:

($ in millions)
Remainder of 2022	$	4
2023		7
2024		5
2025		1

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Financial Instruments and Risk Management

6 Months Ended

Jul. 30, 2022

Financial Instruments and Risk Management [Abstract]

Financial Instruments and Risk Management

11. Financial Instruments and Risk Management

Fair Value Hedge

On May 6, 2022, we entered into a cross-currency swap contract to reduce the effect of the fluctuating U.S. Dollar (“USD”) to Japanese Yen (“JPY”) foreign exchange rate on our foreign currency-denominated intercompany loan between our Japanese and U.S. subsidiary. We expect the gains and losses on this contract to offset losses and gains on the hedged transaction in an effort to reduce the earnings volatility resulting from the remeasurement of the principal and interest accrued on the loan. Though the intercompany loan eliminates in consolidation, the foreign currency remeasurement of the loan and interest by the U.S. subsidiary is reflected in the consolidated financial statements.

The cross-currency swap contract has a notional amount of JPY 11 billion and final receipt of $85 million. The cross-currency swap contract, which matures on November 2, 2031, swaps Yen-denominated interest payments for U.S. dollar-denominated interest payments, thereby economically converting the JPY 11 billion fixed-rate 3.51% intercompany loan to a fixed-rate 6.77% USD-denominated receivable for our U.S. subsidiary.

We designated the cross-currency swap contract to hedge the changes in value of the intercompany loan and its variability on earnings. We will apply fair value hedge accounting, and we will consider market factors other than the change in the spot exchange rate on the notional amount of the swap to be excluded components. The foreign currency spot rate fluctuations on the cross-currency swap notional amount and interest accruals are reported in earnings each period, while all other changes are reported in other comprehensive income. Because the terms of the hedged item and the hedging instrument match and the likelihood of swap counterparty default is not probable, the hedge is expected to exactly offset changes in the fair value of the foreign currency debt resulting from to foreign currency fluctuations over the term of the swap.

As of July 30, 2022, the cross-currency swap had a fair value of $1 million and was included in other assets. We record the changes in the fair value of the contract to AOCL. Each period, we reclassify an amount out of AOCL equal to the remeasurement gain or loss on the hedged intercompany loan that is recorded in selling, general and administrative expenses. As of July 30, 2022, there was $3 million in AOCL, net of tax, related to the cross-currency swap. In addition, we recognize swap interest income based on the differential in fixed interest rates per the contract. For the thirteen and twenty-six weeks ended July 30, 2022, we recorded $1 million of income in interest expense, net. Refer to Note 10 for further information regarding amounts recorded in AOCL.

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Fair Value Measurements

6 Months Ended

Jul. 30, 2022

Fair Value Measurements [Abstract]

Fair Value Measurements

12. Fair Value Measurements

Our financial assets are recorded at fair value, using a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are categorized as follows:

Level 1 – Quoted prices for identical instruments in active markets.

Level 2 – Observable inputs other than quoted prices included within Level 1, including quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs or significant value-drivers are observable in active markets.

Level 3 – Model-derived valuations in which one or more significant inputs or significant value-drivers are unobservable.

12. Fair Value Measurements (continued)

In 2021, we invested $68 million to take a common stock minority stake in a public entity, Retailors, Ltd, which is traded on the Tel Aviv stock exchange. This investment is classified as a Level 1 instrument since the fair value is readily available in an active market.

The fair value of the auction rate security, classified as available-for-sale, is determined by using quoted prices for similar instruments in active markets and accordingly is classified as a Level 2 instrument.

The fair value of the contingent consideration liability associated with the atmos acquisition is estimated using an option pricing model simulation that determines an average projected payment value across numerous iterations.

Our derivative financial instruments are valued using market-based inputs to valuation models. These valuation models require a variety of inputs, including contractual terms, market prices, yield curves, and measures of volatility and, therefore, are classified as Level 2 instruments.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

($ in millions)	As of July 30, 2022						As of July 31, 2021
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Minority investment in common stock	$	107	$	—	$	—	$	92	$	—	$	—
Available-for-sale security		—		6		—		—		7		—
Foreign exchange forward contracts		—		1		—		—		1		—
Cross-currency swap contract		—		1		—		—		—		—
Total assets	$	107	$	8	$	—	$	92	$	8	$	—
Liabilities
Contingent consideration		—		—		35		—		—		—
Foreign exchange forward contracts		—		—		—		—		2		—
Total liabilities	$	—	$	—	$	35	$	—	$	2	$	—

There were no transfers into or out of Level 1, Level 2, or Level 3 assets and liabilities for any of the periods presented.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

Assets and liabilities recognized or disclosed at fair value on the consolidated financial statements on a nonrecurring basis include items such as property, plant and equipment, operating lease right-of-use assets, goodwill, other intangible assets, and minority investments that are not accounted for under the equity method of accounting. These assets are measured using Level 3 inputs, if determined to be impaired.

Minority investments measured using the fair value measurement alternative had a carrying value of $579 million and $612 million as of July 30, 2022 and July 31, 2021, respectively.

12. Fair Value Measurements (continued)

Long-Term Debt

The fair value of long-term debt is determined by using model-derived valuations in which all significant inputs or significant value drivers are observable in active markets and, therefore, are classified as Level 2. The balance as of July 30, 2022 includes the $400 million 4% Notes. The carrying value and estimated fair value of long-term debt were as follows:

($ in millions)	July 30, 2022		July 31, 2021
Carrying value (1)	$	394	$	99
Fair value	$	313	$	102

(1) The carrying value of debt as of July 30, 2022 reflects $6 million of issuer’s discount and costs related to the 4% Notes.

The carrying values of cash and cash equivalents, and other current receivables and payables approximate their fair value.

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Earnings Per Share

6 Months Ended

Jul. 30, 2022

Earnings Per Share [Abstract]

Earnings Per Share

13. Earnings Per Share

We account for earnings per share (“EPS”) using the treasury stock method. Basic EPS is computed by dividing net income for the period by the weighted-average number of common shares outstanding at the end of the period. Diluted earnings per share reflects the weighted-average number of common shares outstanding during the period used in the basic EPS computation plus dilutive common stock equivalents. The computation of diluted earnings per share does not assume conversion, exercise, or contingent issuance of securities that would have an anti-dilutive effect on EPS.

The computation of basic and diluted EPS is as follows:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
(in millions, except per share data)	2022		2021		2022		2021
Net income attributable to Foot Locker, Inc.	$	94	$	430	$	227	$	632
Weighted-average common shares outstanding		94.1		103.8		95.1		103.7
Dilutive effect of potential common shares		1.0		1.4		1.0		1.4
Weighted-average common shares outstanding assuming dilution		95.1		105.2		96.1		105.1
Earnings per share - basic	$	1.00	$	4.14	$	2.39	$	6.10
Earnings per share - diluted	$	0.99	$	4.09	$	2.36	$	6.02
Anti-dilutive share-based awards excluded from diluted calculation		2.8		1.5		2.7		1.7

Performance stock units related to our long-term incentive programs of 0.8 million and 0.6 million have been excluded from diluted weighted-average shares for the periods ended July 30, 2022 and July 31, 2021, respectively. The issuance of these shares is contingent on our performance metrics as compared to the pre-established performance goals, which have not been achieved.

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Pension

6 Months Ended

Jul. 30, 2022

Retirement Plans and Other Benefits [Abstract]

Retirement Plans and Other Benefits

14. Pension

The components of net periodic pension benefit expense are presented in the table below. Service cost is recognized as part of SG&A expense, while the other components are recognized as part of Other income / (expense), net.

	Thirteen weeks ended				Twenty-six weeks ended
		July 30,		July 31,		July 30,		July 31,
($ in millions)		2022		2021		2022		2021
Service cost	$	3	$	4	$	7	$	8
Interest cost		5		5		10		9
Expected return on plan assets		(7)		(8)		(15)		(17)
Amortization of net loss		3		2		5		5
Net benefit expense	$	4	$	3	$	7	$	5

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Share-Based Compensation

6 Months Ended

Jul. 30, 2022

Share-Based Compensation [Abstract]

Share-Based Compensation

15. Share-Based Compensation

Total compensation expense, included in SG&A, and the associated tax benefits recognized related to our share-based compensation plans, were as follows:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Options and employee stock purchase plan	$	2	$	2	$	3	$	4
Restricted stock units and performance stock units		7		6		13		12
Total share-based compensation expense	$	9	$	8	$	16	$	16
Tax benefit recognized	$	1	$	1	$	2	$	2

Valuation Model and Assumptions

We use the Black-Scholes option-pricing model to estimate the fair value of options and the stock purchase plan. The Black-Scholes option-pricing model incorporates various and subjective assumptions, including expected term and expected volatility.

The table below shows assumptions used to compute share-based compensation expense for awards granted during the twenty-six weeks ended July 30, 2022 and July 31, 2021.

		Stock Option Plans						Stock Purchase Plan
	July 30,			July 31,			July 30,			July 31,
	2022			2021			2022			2021
Weighted-average risk free rate of interest		2.3	%		0.9	%		0.4	%		0.2	%
Expected volatility		48.2	%		47	%		40	%		48	%
Weighted-average expected award life (in years)		5.3			5.5			1.0			1.0
Dividend yield		3.7	%		1.5	%		2.0	%		5.0	%
Weighted-average fair value	$	10.5		$	20.22		$	23.47		$	7.84

15. Share-Based Compensation (continued)

The information in the table below provides activity under our stock option plans for the twenty-six weeks ended July 30, 2022.

		Weighted-		Weighted-
	Number	Average		Average
	of	Remaining		Exercise
	Shares	Contractual Life		Price
	(in thousands)	(in years)		(per share)
Options outstanding at the beginning of the year	3,211			$	48.84
Granted	522				31.02
Exercised	(116)				26.15
Expired or cancelled	(148)				51.29
Options outstanding at July 30, 2022	3,469		5.1	$	46.82
Options exercisable at July 30, 2022	2,635		3.9	$	51.67
Options available for future grant at July 30, 2022	1,837

The total fair value of options vested July 30, 2022 and July 31, 2021 was $4 million for both periods. The cash received from option exercises during the thirteen and twenty-six weeks ended July 30, 2022 were $1 million and $3 million, respectively. The related tax benefits realized from option exercises during the thirteen and twenty-six weeks ended July 30, 2022 were not significant. The cash received from option exercises during the thirteen and twenty-six weeks ended July 31, 2021 were $6 million and $10 million, respectively. The related tax benefits realized from option exercises during the thirteen and twenty-six weeks ended July 31, 2021 were $1 million and $2 million, respectively.

The total intrinsic value of options exercised (the difference between the market price of our common stock on the exercise date and the price paid by the optionee to exercise the option) is presented below:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Exercised	$	—	$	5	$	—	$	8

The aggregate intrinsic value for stock options outstanding, and outstanding and exercisable (the difference between our closing stock price on the last trading day of the period and the exercise price of the options, multiplied by the number of in-the-money stock options) is presented below:

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
Outstanding	$	5	$	40
Outstanding and exercisable	$	3	$	20

As of July 30, 2022, there was $5 million of total unrecognized compensation cost related to nonvested stock options which is expected to be recognized over a remaining weighted-average period of 1.6 years.

15. Share-Based Compensation (continued)

The table below summarizes information about stock options outstanding and exercisable at July 30, 2022.

	Options Outstanding				Options Exercisable
		Weighted-
		Average	Weighted-			Weighted-
		Remaining	Average			Average
Range of Exercise	Number	Contractual	Exercise		Number	Exercise
Prices	Outstanding	Life	Price		Exercisable	Price
	(in thousands, except prices per share and contractual life)
$21.60 - $36.51	1,326	7.4	$	26.37	601	$	24.21
$44.78 - $48.98	449	3.3		45.02	448		45.02
$53.61 - $58.94	506	5.8		56.68	398		57.44
$62.02 - $72.83	1,188	3.0		66.13	1,188		66.13
	3,469	5.1	$	46.82	2,635	$	51.67

Restricted Stock Units and Performance Stock Units

Restricted stock units (“RSU”) are awarded to certain officers, key employees of the Company, and nonemployee directors. Additionally, performance stock units (“PSU”) are awarded to officers and certain key employees in connection with our long-term incentive program. Each RSU and PSU represents the right to receive one share of our common stock provided that the applicable performance and vesting conditions are satisfied. PSU awards granted in 2022 also include a performance objective based on our relative total shareholder return over the performance period to a pre-determined peer group, assuming the reinvestment of dividends. The fair value of these awards is determined using a Monte Carlo simulation as of the date of the grant and share-based compensation expense will not be adjusted should the target awards vary from actual awards.  

Generally, RSU awards fully vest after the passage of time, typically three years for employees and one year for nonemployee directors, provided there is continued service with the Company until the vesting date, subject to the terms of the award. PSU awards are earned only after the attainment of performance goals in connection with the relevant performance period and vest after an additional one-year period. No dividends are paid or accumulated on any RSU or PSU awards. Compensation expense is recognized over the vesting period. RSU and PSU activity for the twenty-six weeks ended July 30, 2022 is summarized as follows:

			Weighted-Average
	Number		Remaining		Weighted-Average
	of		Contractual		Grant Date
	Shares		Life		Fair Value
		(in thousands)		(in years)		(per share)
Nonvested at beginning of year		1,391			$	43.95
Granted		1,026				30.22
Vested		(110)				55.58
Performance adjustment (1)		(60)
Forfeited		(92)				34.41
Nonvested at July 30, 2022		2,155		1.8	$	36.95
Aggregate value ($ in millions)	$	80

(1) This represents adjustments made to PSUs reflecting changes in estimates based upon our current performance against predefined financial targets.  

15. Share-Based Compensation (continued)

The total value of RSU and PSU awards that vested during the twenty-six weeks ended July 30, 2022 and July 31, 2021 was $6 million and $22 million, respectively. As of July 30, 2022, there was $44 million of total unrecognized compensation cost related to nonvested awards.

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Legal Proceedings

6 Months Ended

Jul. 30, 2022

Legal Proceedings [Abstract]

Legal Proceedings

16. Legal Proceedings

Legal proceedings pending against the Company or its consolidated subsidiaries consist of ordinary, routine litigation, including administrative proceedings, incidental to the business of the Company or businesses that have been sold or discontinued by the Company in past years. These legal proceedings include commercial, intellectual property, customer, environmental, and employment-related claims.

We do not believe that the outcome of any such legal proceedings pending against the Company or its consolidated subsidiaries, as described above, would have a material adverse effect on our consolidated financial position, liquidity, or results of operations, taken as a whole, based upon current knowledge and taking into consideration current accruals. Litigation is inherently unpredictable. Judgments could be rendered or settlements made that could adversely affect the Company’s operating results or cash flows in a particular period.

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Summary of Significant Accounting Policies (Policy)

6 Months Ended

Jul. 30, 2022

Summary of Significant Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying condensed consolidated financial statements contained in this report are unaudited. In the opinion of management, the condensed consolidated financial statements include all normal, recurring adjustments necessary for a fair presentation of the results for the interim periods presented. As used in these Notes to the Unaudited Condensed Consolidated Financial Statements, the terms “Foot Locker,” “Company,” “we,” “our,” and “us” refer to Foot Locker, Inc. and its consolidated subsidiaries.

The preparation of financial statements in accordance with U.S. generally accepted accounting principles requires us to make estimates and assumptions that affect the amounts reported in the accompanying Unaudited Condensed Consolidated Financial Statements and these Notes and related disclosures. Actual results may differ from those estimates. The results of operations for any interim period are not necessarily indicative of the results expected for the year.

The results of operations for the period ended July 30, 2022 are not necessarily indicative of the results to be expected for the full fiscal year due to the continued uncertainty of general economic conditions that may affect us for the remainder of 2022.

The accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Notes to Consolidated Financial Statements contained in our 2021 Form 10-K.

There were no significant changes to the policies disclosed in Note 1, Summary of Significant Accounting Policies of our 2021 Form 10-K.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

Recently issued accounting pronouncements did not, or are not believed by management to, have a material effect on our present or future consolidated financial statements.

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Acquisition (Tables)

6 Months Ended

Jul. 30, 2022

WSS [Member]

Business Combination Segment Allocation [Line Items]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table represents the final allocation of the purchase price for WSS.

($ in millions)
Assets acquired:
Cash and cash equivalents	$	70
Merchandise inventories		82
Other current assets		10
Property and equipment, net		133
Operating lease right-of-use assets		143
Tradenames		296
Customer relationships		13
Other assets		4
Liabilities assumed:
Accounts payable	$	(58)
Current portion of obligations under finance leases		(3)
Current portion of lease obligations		(19)
Long-term portion of obligations under finance leases		(50)
Long-term lease obligations		(127)
Deferred taxes		(84)
Other liabilities		(4)
Goodwill		405
Total purchase price	$	811

atmos [Member]

Business Combination Segment Allocation [Line Items]

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed

The following table represents the preliminary allocation of the purchase price for atmos.

($ in millions)
Assets acquired:
Cash and cash equivalents	$	6
Merchandise inventories		22
Other current assets		12
Property and equipment, net		7
Operating lease right-of-use assets		44
Tradenames		130
Customer relationships		9
Other assets		6
Liabilities assumed:
Accounts payable	$	(10)
Current portion of lease obligations		(10)
Other current liabilities		(8)
Long-term lease obligations		(35)
Deferred taxes		(44)
Other liabilities		(8)
Goodwill (1)		247
Total purchase price (2)	$	368

(1) Goodwill represented on this table is at the exchange rate in effect as of the date of acquisition.

(2) Total purchase price consists of $333 million in cash and $35 million of contingent consideration.

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Revenue (Tables)

6 Months Ended

Jul. 30, 2022

Revenue [Abstract]

Disaggregation of Revenue

The table below presents sales disaggregated based upon sales channel. Sales are attributable to the channel in which the sales transaction is initiated.

		Thirteen weeks ended			Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales by Channel
Stores	$	1,716	$	1,817	$	3,492	$	3,437
Direct-to-customers		349		458		748		991
Total sales	$	2,065	$	2,275	$	4,240	$	4,428

Revenue from External Customers by Geographic Areas

Sales disaggregated based upon geographic area are presented in the table below. Sales are attributable to the geographic area in which the sales transaction is fulfilled.

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales by Geography
United States	$	1,383	$	1,623	$	2,923	$	3,336
International		682		652		1,317		1,092
Total sales	$	2,065	$	2,275	$	4,240	$	4,428

Activity of Gift Card Liability Balance

	July 30,		July 31,
($ in millions)	2022		2021
Gift card liability at beginning of year	$	46	$	41
Redemptions		(120)		(122)
Breakage recognized in sales		(8)		(9)
Activations		115		128
Foreign currency fluctuations		(1)		—
Gift card liability	$	32	$	38

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Segment Information (Tables)

6 Months Ended

Jul. 30, 2022

Segment Information [Abstract]

Sales and Division Operating Results for Reportable Segments

We evaluate performance based on several factors, primarily the banner’s financial results, referred to as division profit. Division profit reflects income before income taxes, impairment and other charges, corporate expense, non-operating income, and net interest expense.

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales	$	2,065	$	2,275	$	4,240	$	4,428
Operating Results
Division profit		184		332	$	444	$	647
Less: Impairment and other charges (1)		12		36		18		40
Less: Corporate expense (2)		33		32		70		61
Income from operations		139		264		356		546
Interest expense, net		(5)		(2)		(10)		(4)
Other income / (expense), net (3)		9		325		(13)		329
Income before income taxes	$	143	$	587	$	333	$	871

(1) See Note 5, Impairment and Other Charges for further detail.

(2) Corporate expense consists of unallocated selling, general and administrative expenses, as well as depreciation and amortization related to our corporate headquarters, centrally managed departments, unallocated insurance and benefit programs, certain foreign exchange transaction gains and losses, and other items.  

(3) Other income / (expense), net for the thirteen weeks and twenty-six weeks ended July 30, 2022 represented primarily the loss on the change in fair value of our investment in Retailors, Ltd., a publicly-listed entity, which was partially offset by other income. See Note 6, Other Income / (Expense), net.

Disaggregation of Revenue

The table below presents sales disaggregated based upon sales channel. Sales are attributable to the channel in which the sales transaction is initiated.

		Thirteen weeks ended			Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Sales by Channel
Stores	$	1,716	$	1,817	$	3,492	$	3,437
Direct-to-customers		349		458		748		991
Total sales	$	2,065	$	2,275	$	4,240	$	4,428

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Impairment and Other Charges (Tables)

6 Months Ended

Jul. 30, 2022

Impairment and Other Charges [Abstract]

Schedule of Impairment and Other Charges

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Transformation consulting	$	9	$	—	$	10	$	—
Impairment of long-lived assets and right-of-use assets		2		39		5		39
Acquisition and integration costs		1		—		3		—
Lease termination costs		—		4		—		4
Impairment of investments		—		—		—		2
Reorganization costs		—		—		—		2
Insurance recovery		—		(7)		—		(7)
Total impairment and other charges	$	12	$	36	$	18	$	40

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Cash, Cash Equivalents, and Restricted Cash (Tables)

6 Months Ended

Jul. 30, 2022

Restricted Cash [Abstract]

Reconciliation of Cash and Cash Equivalents

The table below provides a reconciliation of cash and cash equivalents, as reported on our Condensed Consolidated Balance Sheets, to cash, cash equivalents, and restricted cash, as reported on our Condensed Consolidated Statements of Cash Flows.

	July 30,		July 31,
($ in millions)	2022		2021
Cash and cash equivalents	$	386	$	1,845
Restricted cash included in other current assets		7		7
Restricted cash included in other non-current assets		38		29
Cash, cash equivalents, and restricted cash	$	431	$	1,881

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Other Intangible Assets, Net (Tables)

6 Months Ended

Jul. 30, 2022

Goodwill and Other Intangible Assets, Net [Abstract]

Components of Intangible Assets

The components of finite-lived intangible assets and intangible assets not subject to amortization are as follows:

		July 30, 2022						July 31, 2021
	Gross		Accum.		Net		Gross		Accum.		Net
($ in millions)	value		amort.		value		value		amort.		value
Amortized intangible assets: (1)
Lease acquisition costs	$	97	$	(95)	$	2	$	116	$	(112)	$	4
Trademarks/tradenames (2)		18		(18)		—		20		(17)		3
Customer lists		20		(5)		15		—		—		—
	$	135	$	(118)	$	17	$	136	$	(129)	$	7
Indefinite life intangible assets: (1)
Trademarks/tradenames					$	415					$	9
Other intangible assets, net					$	432					$	16

(1) The change in the ending balances also reflects the effect of foreign currency fluctuations due primarily to movements of the euro in relation to the U.S. dollar.

(2) During the fourth quarter of 2021, we recorded a non-cash impairment charge related to the Footaction tradename.  

Amortization Expense

Amortization expense recorded is as follows:

	Thirteen weeks ended					Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Amortization expense	$	2	$	1	$	5	$	2

Estimated Future Expected Amortization Expense for Finite Life Intangible Assets

Estimated future amortization expense for finite-life intangible assets is as follows:

($ in millions)
Remainder of 2022	$	4
2023		7
2024		5
2025		1

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Accumulated Other Comprehensive Loss (Tables)

6 Months Ended

Jul. 30, 2022

Accumulated Other Comprehensive Loss [Abstract]

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss (“AOCL”), net of tax, is comprised of the following:

	July 30,		July 31,		January 29,
($ in millions)	2022		2021		2022
Foreign currency translation adjustments	$	(182)	$	(74)	$	(107)
Hedge contracts		(2)		(1)		—
Unrecognized pension cost and postretirement benefit		(232)		(263)		(236)
	$	(416)	$	(338)	$	(343)

Changes in Accumulated Other Comprehensive Loss

The changes in AOCL for the twenty-six weeks ended July 30, 2022 were as follows:

	Foreign				Items Related
	Currency				to Pension and
	Translation				Postretirement
($ in millions)	Adjustments		Hedges		Benefits		Total
Balance as of January 29, 2022	$	(107)		—	$	(236)	$	(343)
OCI before reclassification		(75)		2		—		(73)
Reclassification of hedges, net of tax		—		(4)		—		(4)
Amortization of pension actuarial loss, net of tax		—		—		4		4
Other comprehensive income		(75)		(2)		4		(73)
Balance as of July 30, 2022	$	(182)	$	(2)	$	(232)	$	(416)

Reclassification from Accumulated Other Comprehensive Loss

Reclassifications from AOCL for the twenty-six weeks ended July 30, 2022 were as follows:

($ in millions)
Reclassification of hedge loss:
Cross-currency swap	$	(4)
Income tax		—
Reclassification of hedges, net of tax	$	(4)
Amortization of actuarial loss:
Pension benefits	$	5
Income tax benefit		(1)
Amortization of actuarial loss, net of tax	$	4
Total, net of tax	$	—

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Fair Value Measurements (Tables)

6 Months Ended

Jul. 30, 2022

Fair Value Measurements [Abstract]

Assets and Liabilities Measured at Fair Value on Recurring Basis

Assets and Liabilities Measured at Fair Value on a Recurring Basis

($ in millions)	As of July 30, 2022						As of July 31, 2021
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Minority investment in common stock	$	107	$	—	$	—	$	92	$	—	$	—
Available-for-sale security		—		6		—		—		7		—
Foreign exchange forward contracts		—		1		—		—		1		—
Cross-currency swap contract		—		1		—		—		—		—
Total assets	$	107	$	8	$	—	$	92	$	8	$	—
Liabilities
Contingent consideration		—		—		35		—		—		—
Foreign exchange forward contracts		—		—		—		—		2		—
Total liabilities	$	—	$	—	$	35	$	—	$	2	$	—

Carrying Value and Estimated Fair Value of Long-Term Debt

($ in millions)	July 30, 2022		July 31, 2021
Carrying value (1)	$	394	$	99
Fair value	$	313	$	102

(1) The carrying value of debt as of July 30, 2022 reflects $6 million of issuer’s discount and costs related to the 4% Notes.

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Earnings Per Share (Tables)

6 Months Ended

Jul. 30, 2022

Earnings Per Share [Abstract]

Basic and Diluted Weighted-Average Number of Common Shares Outstanding

The computation of basic and diluted EPS is as follows:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
(in millions, except per share data)	2022		2021		2022		2021
Net income attributable to Foot Locker, Inc.	$	94	$	430	$	227	$	632
Weighted-average common shares outstanding		94.1		103.8		95.1		103.7
Dilutive effect of potential common shares		1.0		1.4		1.0		1.4
Weighted-average common shares outstanding assuming dilution		95.1		105.2		96.1		105.1
Earnings per share - basic	$	1.00	$	4.14	$	2.39	$	6.10
Earnings per share - diluted	$	0.99	$	4.09	$	2.36	$	6.02
Anti-dilutive share-based awards excluded from diluted calculation		2.8		1.5		2.7		1.7

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Pension (Tables)

6 Months Ended

Jul. 30, 2022

Retirement Plans and Other Benefits [Abstract]

Net Benefit Expense (Income)

	Thirteen weeks ended				Twenty-six weeks ended
		July 30,		July 31,		July 30,		July 31,
($ in millions)		2022		2021		2022		2021
Service cost	$	3	$	4	$	7	$	8
Interest cost		5		5		10		9
Expected return on plan assets		(7)		(8)		(15)		(17)
Amortization of net loss		3		2		5		5
Net benefit expense	$	4	$	3	$	7	$	5

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Share-Based Compensation (Tables)

6 Months Ended

Jul. 30, 2022

Share-Based Compensation [Abstract]

Total Compensation Expense and the Related Tax Benefits Recognized

Total compensation expense, included in SG&A, and the associated tax benefits recognized related to our share-based compensation plans, were as follows:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Options and employee stock purchase plan	$	2	$	2	$	3	$	4
Restricted stock units and performance stock units		7		6		13		12
Total share-based compensation expense	$	9	$	8	$	16	$	16
Tax benefit recognized	$	1	$	1	$	2	$	2

Assumptions used to Compute Share-Based Compensation Expense

The table below shows assumptions used to compute share-based compensation expense for awards granted during the twenty-six weeks ended July 30, 2022 and July 31, 2021.

		Stock Option Plans						Stock Purchase Plan
	July 30,			July 31,			July 30,			July 31,
	2022			2021			2022			2021
Weighted-average risk free rate of interest		2.3	%		0.9	%		0.4	%		0.2	%
Expected volatility		48.2	%		47	%		40	%		48	%
Weighted-average expected award life (in years)		5.3			5.5			1.0			1.0
Dividend yield		3.7	%		1.5	%		2.0	%		5.0	%
Weighted-average fair value	$	10.5		$	20.22		$	23.47		$	7.84

Options Granted under Stock Option Plans

		Weighted-		Weighted-
	Number	Average		Average
	of	Remaining		Exercise
	Shares	Contractual Life		Price
	(in thousands)	(in years)		(per share)
Options outstanding at the beginning of the year	3,211			$	48.84
Granted	522				31.02
Exercised	(116)				26.15
Expired or cancelled	(148)				51.29
Options outstanding at July 30, 2022	3,469		5.1	$	46.82
Options exercisable at July 30, 2022	2,635		3.9	$	51.67
Options available for future grant at July 30, 2022	1,837

Total Intrinsic Value of Options Exercised

The total intrinsic value of options exercised (the difference between the market price of our common stock on the exercise date and the price paid by the optionee to exercise the option) is presented below:

	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		July 31,		July 30,		July 31,
($ in millions)	2022		2021		2022		2021
Exercised	$	—	$	5	$	—	$	8

Aggregate Intrinsic Value for Stock Options Outstanding and Exercisable

The aggregate intrinsic value for stock options outstanding, and outstanding and exercisable (the difference between our closing stock price on the last trading day of the period and the exercise price of the options, multiplied by the number of in-the-money stock options) is presented below:

	Twenty-six weeks ended
	July 30,		July 31,
($ in millions)	2022		2021
Outstanding	$	5	$	40
Outstanding and exercisable	$	3	$	20

Information about Stock Options Outstanding and Exercisable

The table below summarizes information about stock options outstanding and exercisable at July 30, 2022.

	Options Outstanding				Options Exercisable
		Weighted-
		Average	Weighted-			Weighted-
		Remaining	Average			Average
Range of Exercise	Number	Contractual	Exercise		Number	Exercise
Prices	Outstanding	Life	Price		Exercisable	Price
	(in thousands, except prices per share and contractual life)
$21.60 - $36.51	1,326	7.4	$	26.37	601	$	24.21
$44.78 - $48.98	449	3.3		45.02	448		45.02
$53.61 - $58.94	506	5.8		56.68	398		57.44
$62.02 - $72.83	1,188	3.0		66.13	1,188		66.13
	3,469	5.1	$	46.82	2,635	$	51.67

Restricted Share and Unit Activity

			Weighted-Average
	Number		Remaining		Weighted-Average
	of		Contractual		Grant Date
	Shares		Life		Fair Value
		(in thousands)		(in years)		(per share)
Nonvested at beginning of year		1,391			$	43.95
Granted		1,026				30.22
Vested		(110)				55.58
Performance adjustment (1)		(60)
Forfeited		(92)				34.41
Nonvested at July 30, 2022		2,155		1.8	$	36.95
Aggregate value ($ in millions)	$	80

(1) This represents adjustments made to PSUs reflecting changes in estimates based upon our current performance against predefined financial targets.  

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Acquisition (Narrative) (Details) $ in Millions	3 Months Ended			6 Months Ended	12 Months Ended
	Jul. 30, 2022 USD ($)	Jan. 29, 2022 USD ($)		Jul. 30, 2022 USD ($)	Jan. 29, 2022 USD ($) agreement		Jul. 31, 2021 USD ($)
Business Combination Segment Allocation [Line Items]
Purchase of business, net of cash acquired				$ 12
Goodwill	$ 773	$ 797	[1]	773	$ 797	[1]	$ 158
Businesses acquired | agreement					2
atmos [Member]
Business Combination Segment Allocation [Line Items]
Payments to Acquire Businesses, Gross	5	30		8	$ 333
Purchase price				368
Contingent consideration	35	35		35	35
Post-closing payable	6			6
Goodwill		247			247
Increase in goodwill	8
atmos [Member] | Maximum [Member]
Business Combination Segment Allocation [Line Items]
Contingent consideration	111			111
WSS [Member]
Business Combination Segment Allocation [Line Items]
Payments to Acquire Businesses, Gross	$ 0			$ 4
Purchase price					811
Purchase of business, net of cash acquired					741
Goodwill		$ 405			$ 405

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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Acquisition (Schedule of Assets/Liabilities Acquired) (Details) - USD ($) $ in Millions	Jul. 30, 2022	Jan. 29, 2022		Jul. 31, 2021
Business Combination Segment Allocation [Line Items]
Goodwill	$ 773	$ 797	[1]	$ 158
atmos [Member]
Business Combination Segment Allocation [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents		6
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory		22
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other		12
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment		7
Business Combination, Recognized Identifiable Assets Acquired, Right-of-use-assets		44
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Indefinite-Lived Intangible Assets		130
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles		9
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets		6
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable		(10)
Business Combination, Recognized Identifiable Liabilities Assumed, Current Portion of Obligations Under Finance Leases		(10)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Other		(8)
Business Combination, Recognized Identifiable Liabilities Assumed, Long-term Lease Obligations		(35)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities		(44)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Other		(8)
Goodwill		247
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net, Total		368
WSS [Member]
Business Combination Segment Allocation [Line Items]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Cash and Equivalents		70
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Inventory		82
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other		10
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment		133
Business Combination, Recognized Identifiable Assets Acquired, Right-of-use-assets		143
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Indefinite-Lived Intangible Assets		296
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles		13
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets		4
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable		(58)
Business Combination, Recognized Identifiable Liabilities Assumed, Current Portion of Obligations Under Finance Leases		(3)
Business Combination, Recognized Identifiable Liabilities Assumed, Current Portion of Lease Obligations		(19)
Business Combination, Recognized Identifiable Liabilities Assumed, Long Term Portion of Obligations Under Finance Leases		(50)
Business Combination, Recognized Identifiable Liabilities Assumed, Long-term Lease Obligations		(127)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Deferred Tax Liabilities		(84)
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Other		(4)
Goodwill		405
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Net, Total		$ 811

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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Revenue (Schedule of Sales Disaggregated by Sales Channel) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Sales	$ 2,065	$ 2,275	$ 4,240	$ 4,428
Store Sales Channel [Member]
Sales	1,716	1,817	3,492	3,437
Direct to Customers Sales Channel [Member]
Sales	$ 349	$ 458	$ 748	$ 991

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Revenue (Schedule of Sales Disaggregated by Geographic Area) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Sales	$ 2,065	$ 2,275	$ 4,240	$ 4,428
United States
Sales	1,383	1,623	2,923	3,336
International [Member]
Sales	$ 682	$ 652	$ 1,317	$ 1,092

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Revenue (Activity of Gift Card Liability Balance) (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021
Accrued gift card liability at beginning of period	$ 46	$ 41
Foreign currency fluctuations	(1)
Accrued gift card liability at end of period	32	38
Gift Card Redemption Revenue [Member]
Revenue recognized	(120)	(122)
Gift Card Breakage Revenue [Member]
Revenue recognized	(8)	(9)
Gift Card Activations [Member]
Activations	$ 115	$ 128

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Segment Information (Sales and Division Operating Results for Reportable Segments) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Segment Information [Abstract]
Sales	$ 2,065	$ 2,275	$ 4,240	$ 4,428
Division profit	184	332	444	647
Less: Impairment and other charges	12	36	18	40
Less: Corporate expense	33	32	70	61
Income from operations	139	264	356	546
Interest expense, net	(5)	(2)	(10)	(4)
Other (expense) / income, net	9	325	(13)	329
Income before income taxes	$ 143	$ 587	$ 333	$ 871

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Impairment and Other Charges (Schedule of Impairment and Other Charges) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Impairment and Other Charges [Abstract]
Transformation consulting	$ 9		$ 10
Impairment of long-lived assets and right-of-use assets	2	$ 39	5	$ 39
Acquisition and integration costs	1		3
Lease termination costs		4		4
Impairment of investments				2
Reorganization costs				2
Insurance recoveries		(7)		(7)
Total impairment and other charges	$ 12	$ 36	$ 18	$ 40

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Impairment and Other Charges (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Impairment and Other Charges [Abstract]
Impairment of assets	$ 2	$ 39	$ 5	$ 39
Lease termination costs		(4)		(4)
Transformation consulting	$ 9		$ 10
Impairment of investments				2
Reorganization costs				2
Insurance recoveries from social unrest		$ 7		$ 7

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Other Income (Expense), net (Narrative) (Details) - USD ($) $ in Millions		3 Months Ended		6 Months Ended
	Jun. 27, 2022	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Other Income [Abstract]
Gain on disposal of business				$ 18
Proceeds from sale of business	$ 47			47
Net benefit expense (income)		$ 4	$ 3	$ 7	$ 5

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Cash, Cash Equivalents, and Restricted Cash (Reconciliation of Cash and Cash Equivalents) (Details) - USD ($) $ in Millions	Jul. 30, 2022	Jan. 29, 2022		Jul. 31, 2021	Jan. 30, 2021
Restricted Cash [Abstract]
Cash and cash equivalents	$ 386	$ 804	[1]	$ 1,845
Restricted cash included in other current assets	7			7
Restricted cash included in other non-current assets	38			29
Cash, cash equivalents, and restricted cash	$ 431	$ 850		$ 1,881	$ 1,718

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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Goodwill (Narrative) (Details) - USD ($) $ in Millions	Jul. 30, 2022	Jun. 27, 2022	Jan. 29, 2022		Jul. 31, 2021
Business Combination Segment Allocation [Line Items]
Goodwill allocated to assets sold		$ 6
Goodwill	$ 773		$ 797	[1]	$ 158
WSS [Member]
Business Combination Segment Allocation [Line Items]
Goodwill			$ 405

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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Other Intangible Assets, Net (Schedule of Other Intangible Asset) (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 30, 2022	Jan. 29, 2022	[1]	Jul. 31, 2021
Intangible Assets by Major Class [Line Items]
Amortized intangible assets, Gross value	$ 135			$ 136
Amortized intangible assets, Accum. amort.	(118)			(129)
Amortized intangible assets, Net value	17			7
Other intangible assets, net	432	$ 454		16
Lease Acquisition Costs [Member]
Intangible Assets by Major Class [Line Items]
Amortized intangible assets, Gross value	97			116
Amortized intangible assets, Accum. amort.	(95)			(112)
Amortized intangible assets, Net value	2			4
Trademarks and Trade Names [Member]
Intangible Assets by Major Class [Line Items]
Amortized intangible assets, Gross value	18			20
Amortized intangible assets, Accum. amort.	(18)			(17)
Amortized intangible assets, Net value				3
Customer Lists [Member]
Intangible Assets by Major Class [Line Items]
Amortized intangible assets, Gross value	20
Amortized intangible assets, Accum. amort.	(5)
Amortized intangible assets, Net value	$ 15
Finite-Lived Intangible Assets, Remaining Amortization Period	3 years
atmos [Member] | Customer Lists [Member]
Intangible Assets by Major Class [Line Items]
Amortized intangible assets, Net value	$ 9
WSS [Member] | Customer Lists [Member]
Intangible Assets by Major Class [Line Items]
Amortized intangible assets, Net value	13
Trademarks and Trade Names [Member]
Intangible Assets by Major Class [Line Items]
Indefinite life intangible assets, Net Value	415			$ 9
Trademarks and Trade Names [Member] | atmos [Member]
Intangible Assets by Major Class [Line Items]
Indefinite life intangible assets, Net Value	130
Trademarks and Trade Names [Member] | WSS [Member]
Intangible Assets by Major Class [Line Items]
Indefinite life intangible assets, Net Value	$ 296

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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Other Intangible Assets, Net (Amortization Expense) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Goodwill and Other Intangible Assets, Net [Abstract]
Amortization expense	$ 2	$ 1	$ 5	$ 2

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Other Intangible Assets, Net (Estimated Future Amortization Expense for Finite Lived Intangibles) (Details) $ in Millions	Jul. 30, 2022 USD ($)
Goodwill and Other Intangible Assets, Net [Abstract]
Remainder of 2022	$ 4
2023	7
2024	5
2025	$ 1

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Accumulated Other Comprehensive Loss (Schedule of Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Millions	Jul. 30, 2022	Jan. 29, 2022		Jul. 31, 2021
Accumulated Other Comprehensive Loss [Abstract]
Foreign currency translation adjustments	$ (182)	$ (107)		$ (74)
Cash flow hedges	(2)			(1)
Unrecognized pension cost and postretirement benefit	(232)	(236)		(263)
Accumulated other comprehensive loss ("AOCL"), net of tax	$ (416)	$ (343)	[1]	$ (338)

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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Accumulated Other Comprehensive Loss (Changes in Accumulated Other Comprehensive Loss) (Details) $ in Millions	6 Months Ended
	Jul. 30, 2022 USD ($)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	$ (343)	[1]
OCI before reclassification	(73)
Reclassification of hedges, net of tax	(4)
Amortization of pension actuarial loss, net of tax	4
Other comprehensive income	(73)
Ending Balance	(416)
Foreign Currency Translation Adjustments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	(107)
OCI before reclassification	(75)
Amortization of pension actuarial loss, net of tax
Other comprehensive income	(75)
Ending Balance	(182)
Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance
OCI before reclassification	2
Reclassification of hedges, net of tax	(4)
Amortization of pension actuarial loss, net of tax
Other comprehensive income	(2)
Ending Balance	(2)
Items Related to Pension and Postretirement Benefits [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance	(236)
Amortization of pension actuarial loss, net of tax	4
Other comprehensive income	4
Ending Balance	$ (232)

[1] The balance sheet at January 29, 2022 has been derived from the previously reported audited consolidated financial statements at that date, but does not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. For further information, refer to the consolidated financial statements and footnotes thereto included in Foot Locker, Inc.’s Annual Report on Form 10-K for the year ended January 29, 2022.

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Accumulated Other Comprehensive Loss (Reclassifications from Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Cross-currency swap			$ (4)
Income tax	$ 0	$ 0	0	$ 0
Reclassification of hedges, net of tax			(4)
Income tax benefit			(1)
Amortization of pension actuarial loss, net of tax			4
Total, net of tax			0
Pension Benefits [Member]
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items]
Pension benefits			$ 5

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Financial Instruments and Risk Management (Narrative) (Details) $ in Millions, ¥ in Billions	3 Months Ended	6 Months Ended
	Jul. 30, 2022 USD ($)	Jul. 30, 2022 USD ($)	May 06, 2022 USD ($)	May 06, 2022 JPY (¥)	May 05, 2022	Jul. 31, 2021 USD ($)
Derivative [Line Items]
Change in fair value of derivatives, net of income tax benefit of $-, $-, $-, and $-, respectively	$ (3)	$ (2)
Hedge Derivative, AOCL	(2)	(2)				$ (1)
Cross Currency Interest Rate Contract [Member]
Derivative [Line Items]
Notional value of contracts outstanding			$ 85	¥ 11
Derivative, fixed rate			6.77%	6.77%	3.51%
Derivative, fair value	1	1
Derivative, AOCL	3	3
Derivative income	$ 1	$ 1

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Fair Value Measurements (Assets and Liabilities Measured at Fair Value on Recurring Basis) (Details) - Fair Value, Measurements, Recurring [Member] - USD ($) $ in Millions	Jul. 30, 2022	Jul. 31, 2021
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Assets measured at fair value on recurring basis	$ 107	$ 92
Level 1 [Member] | Minority Investment in Common Stock [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Assets measured at fair value on recurring basis	107	92
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Assets measured at fair value on recurring basis	8	8
Liabilities measured at fair value on recurring basis		2
Level 2 [Member] | Available-for-sale Securities [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Assets measured at fair value on recurring basis	6	7
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Liabilities measured at fair value on recurring basis	35
Level 3 [Member] | Contingent Consideration [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Liabilities measured at fair value on recurring basis	35
Forward Foreign Exchange Contracts [Member] | Level 2 [Member] | Derivative Financial Instruments, Liabilities [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Liabilities measured at fair value on recurring basis		2
Forward Foreign Exchange Contracts [Member] | Level 2 [Member] | Derivative Financial Instruments, Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Assets measured at fair value on recurring basis	1	$ 1
Cross Currency Interest Rate Contract [Member] | Level 2 [Member] | Derivative Financial Instruments, Assets [Member]
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Assets measured at fair value on recurring basis	$ 1

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Fair Value Measurements (Carrying Value and Estimated Fair Value of Long-Term Debt) (Details) - USD ($) $ in Millions	Jul. 30, 2022	Jul. 31, 2021
Fair Value Measurements [Abstract]
Long-term debt, Carrying value	$ 394	$ 99
Long-term debt, Fair value	313	$ 102
Debt discount	$ 6

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Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jul. 30, 2022	Jul. 30, 2022	Jul. 31, 2021
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount	$ 0	$ 0	$ 0
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount	0	0	0
Fair Value, Liabilities, Level 1 to Level 2 Transfers, Amount	0	0	0
Fair Value, Liabilities, Level 2 to Level 1 Transfers, Amount	0	0	0
Equity method investment fair value	579	579	$ 612
Transformation consulting	$ 9	10
Increase (decrease) in minority interests		$ 68
Senior Notes Due 2029 [Member]
Interest rate	4.00%	4.00%
Debt instrument, face amount	$ 400	$ 400

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Earnings Per Share (Narrative) (Details) - shares shares in Millions	6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021
Earnings Per Share [Abstract]
Contingently issuable shares excluded from diluted earnings per share	0.8	0.6

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Earnings Per Share (Computation of Basic and Diluted Earnings Per Share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Net income/(loss)	$ 94	$ 430	$ 227	$ 632
Weighted-average common shares outstanding	94.1	103.8	95.1	103.7
Dilutive effect of potential common shares	1.0	1.4	1.0	1.4
Weighted-average common shares outstanding assuming dilution	95.1	105.2	96.1	105.1
Earnings per share - basic	$ 1.00	$ 4.14	$ 2.39	$ 6.10
Earnings per share - diluted	$ 0.99	$ 4.09	$ 2.36	$ 6.02
Stock Option Plans [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Anti-dilutive share-based awards excluded from diluted calculation	2.8	1.5	2.7	1.7

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Pension (Net Benefit Expense (Income)) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Retirement Plans and Other Benefits [Abstract]
Service cost	$ 3	$ 4	$ 7	$ 8
Interest cost	$ 5	$ 5	$ 10	$ 9
Interest cost, extensible enumeration	Other (expense) / income, net	Other (expense) / income, net	Other (expense) / income, net	Other (expense) / income, net
Expected return on plan assets	$ (7)	$ (8)	$ (15)	$ (17)
Expected return on plan assets, extensible enumeration	Other (expense) / income, net	Other (expense) / income, net	Other (expense) / income, net	Other (expense) / income, net
Amortization of net loss	$ 3	$ 2	$ 5	$ 5
Amortization of net loss, extensible enumeration	Other (expense) / income, net	Other (expense) / income, net	Other (expense) / income, net	Other (expense) / income, net
Net benefit expense (income)	$ 4	$ 3	$ 7	$ 5

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Share-Based Compensation (Narrative) (Details) - USD ($) shares in Thousands, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share Based Compensation Arrangement By Share Based Payment Award Number Of Shares Available For Grant	1,837		1,837
Unrecognized compensation cost	$ 44		$ 44
Fair value of options vested			4	$ 4
Tax benefit realized from options exercised	0	$ 1	0	2
Proceeds from exercise of stock options	1	$ 6	3	10
Restricted Stock and Units [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of awards			6	$ 22
Dividends			$ 0
Restricted Stock and Units [Member] | Employees [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period			3 years
Restricted Stock and Units [Member] | Director [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period			1 year
Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period			1 year
Nonvested Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unrecognized compensation cost	$ 5		$ 5
Unrecognized compensation cost related to nonvested stock options, weighted-average period expected to be recognized			1 year 7 months 6 days
2013 ESPP [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average expected award life (in years)			1 year	1 year

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Share-Based Compensation (Total Compensation Expense Included in SG&A and the Related Tax Benefits Recognized) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021	Jul. 30, 2022	Jul. 31, 2021
Share-Based Compensation [Abstract]
Options and shares purchased under the employee stock purchase plan	$ 2	$ 2	$ 3	$ 4
Restricted stock units and performance stock units	7	6	13	12
Total share-based compensation expense	9	8	16	16
Tax benefit recognized	$ 1	$ 1	$ 2	$ 2

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Share-Based Compensation (Assumptions Used to Compute Share-Based Compensation Expense) (Details) - $ / shares	6 Months Ended
	Jul. 30, 2022	Jul. 31, 2021
Stock Option Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average risk free rate of interest	2.30%	0.90%
Expected volatility	48.20%	47.00%
Weighted-average expected award life (in years)	5 years 3 months 18 days	5 years 6 months
Dividend yield	3.70%	1.50%
Weighted-average fair value	$ 10.5	$ 20.22
2013 ESPP [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted-average risk free rate of interest	0.40%	0.20%
Expected volatility	40.00%	48.00%
Weighted-average expected award life (in years)	1 year	1 year
Dividend yield	2.00%	5.00%
Weighted-average fair value	$ 23.47	$ 7.84

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Share-Based Compensation (Options Granted Under Stock Option Plans) (Details) shares in Thousands	6 Months Ended
	Jul. 30, 2022 $ / shares shares
Number of Shares
Options outstanding at beginning of year	3,211
Granted	522
Exercised	(116)
Expired or cancelled	(148)
Options outstanding at end of period	3,469
Options exercisable at end of period	2,635
Options available for future grant at end of period	1,837
Weighted-Average Exercise Price
Options outstanding at beginning of year | $ / shares	$ 48.84
Granted | $ / shares	31.02
Exercised | $ / shares	26.15
Expired or cancelled | $ / shares	51.29
Options outstanding at end of period | $ / shares	46.82
Options exercisable at end of period | $ / shares	$ 51.67
Options outstanding, weighted-average remaining contractual life	5 years 1 month 6 days
Options exercisable at end of period, Weighted-average remaining contractual life	3 years 10 months 24 days

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Share-Based Compensation (Total Intrinsic Value of Options Exercised) (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jul. 31, 2021	Jul. 31, 2021
Intrinsic value of stock options
Exercised	$ 5	$ 8

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Share-Based Compensation (Aggregate Intrinsic Value for Stock Options Outstanding and Exercisable) (Details) - USD ($) $ in Millions	Jul. 30, 2022	Jul. 31, 2021
Share-Based Compensation [Abstract]
Outstanding	$ 5	$ 40
Outstanding and exercisable	$ 3	$ 20

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Share-Based Compensation (Information about Stock Options Outstanding and Exercisable) (Details) - $ / shares shares in Thousands	6 Months Ended
	Jul. 30, 2022	Jan. 29, 2022
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Options Outstanding, Number of Shares	3,469	3,211
Options outstanding, weighted-average remaining contractual life	5 years 1 month 6 days
Options Outstanding, Weighted-Average Exercise Price	$ 46.82	$ 48.84
Options Exercisable, Number of Shares	2,635
Options Exercisable, Weighted-Average Exercise Price	$ 51.67
$21.60 - $36.51 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	21.60
Range of Exercise Prices, Upper Limit	$ 36.51
Options Outstanding, Number of Shares	1,326
Options outstanding, weighted-average remaining contractual life	7 years 4 months 24 days
Options Outstanding, Weighted-Average Exercise Price	$ 26.37
Options Exercisable, Number of Shares	601
Options Exercisable, Weighted-Average Exercise Price	$ 24.21
$44.78 - $48.98 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	44.78
Range of Exercise Prices, Upper Limit	$ 48.98
Options Outstanding, Number of Shares	449
Options outstanding, weighted-average remaining contractual life	3 years 3 months 18 days
Options Outstanding, Weighted-Average Exercise Price	$ 45.02
Options Exercisable, Number of Shares	448
Options Exercisable, Weighted-Average Exercise Price	$ 45.02
$53.61 - $58.94 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	53.61
Range of Exercise Prices, Upper Limit	$ 58.94
Options Outstanding, Number of Shares	506
Options outstanding, weighted-average remaining contractual life	5 years 9 months 18 days
Options Outstanding, Weighted-Average Exercise Price	$ 56.68
Options Exercisable, Number of Shares	398
Options Exercisable, Weighted-Average Exercise Price	$ 57.44
$62.02 - $72.83 [Member]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items]
Range of Exercise Prices, Lower Limit	62.02
Range of Exercise Prices, Upper Limit	$ 72.83
Options Outstanding, Number of Shares	1,188
Options outstanding, weighted-average remaining contractual life	3 years
Options Outstanding, Weighted-Average Exercise Price	$ 66.13
Options Exercisable, Number of Shares	1,188
Options Exercisable, Weighted-Average Exercise Price	$ 66.13

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Share-Based Compensation (Changes in Nonvested Options) (Details) - Restricted Stock and Units [Member] $ / shares in Units, shares in Thousands, $ in Millions	6 Months Ended
	Jul. 30, 2022 USD ($) $ / shares shares
Number of Shares
Nonvested, Beginning Balance	1,391
Granted	1,026
Vested	(110)
Performance adjustment	(60)
Expired or cancelled	(92)	[1]
Nonvested, Ending Balance	2,155
Aggregate value | $	$ 80
Wtg. Avg. remaining contractual life (in years)	1 year 9 months 18 days
Weighted-Average Grant Date Fair Value per Share
Nonvested, Beginning Balance | $ / shares	$ 43.95
Granted | $ / shares	30.22
Vested | $ / shares	55.58
Cancelled | $ / shares	34.41	[1]
Nonvested, Ending Balance | $ / shares	$ 36.95

[1] Weighted-Average