What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-05-31 compared with 2023-11-22 · 49 added, 102 removed, 266 unchanged (36% of the section changed)

1 unchanged sentence

Consolidated Statements of Operations

Three Months Ended Nine Months Ended

(millions, except per share data) (unaudited) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022

Three Months Ended

(millions, except per share data) (unaudited) May 4, 2024 April 29, 2023

Sales $ 24,143 $ 24,948

22 unchanged sentences

Consolidated Statements of Comprehensive Income

Three Months Ended Nine Months Ended

(millions) (unaudited) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022

Three Months Ended

(millions) (unaudited) May 4, 2024 April 29, 2023

Net earnings $ 942 $ 950

Other comprehensive income, net of tax

Other comprehensive (loss) / income, net of tax

Pension benefit liabilities — 2

Cash flow hedges and currency translation adjustment ( 5 ) ( 5 )

Other comprehensive income (loss) ( 5 ) 161 ( 11 ) 345

Other comprehensive loss ( 5 ) ( 3 )

Comprehensive income $ 937 $ 947

5 unchanged sentences

Consolidated Statements of Financial Position

(millions, except footnotes) (unaudited) October 28,

2023 January 28,

2023 October 29,

(millions, except footnotes) (unaudited) May 4,

2024 February 3,

2024 April 29,

Cash and cash equivalents $ 3,604 $ 3,805 $ 1,321

31 unchanged sentences

Common Stock Authorized 6,000,000,000 shares, $ 0.0833 par value;

461,651,176 , 460,346,947 , and 460,297,654 shares issued and outstanding as of October 28, 2023, January 28, 2023, and October 29, 2022, respectively.

462,635,539 , 461,675,441 , and 461,552,843 shares issued and outstanding as of May 4, 2024, February 3, 2024, and April 29, 2023, respectively.

Preferred Stock Authorized 5,000,000 shares, $ 0.01 par value;

6 unchanged sentences

Consolidated Statements of Cash Flows

Nine Months Ended

(millions) (unaudited) October 28, 2023 October 29, 2022

Three Months Ended

(millions) (unaudited) May 4, 2024 April 29, 2023

Operating activities

4 unchanged sentences

Deferred income taxes 64 95

Noncash losses / (gains) and other, net

Noncash (gains) / losses and other, net

( 31 ) ( 11 )

Changes in operating accounts:

11 unchanged sentences

Change in commercial paper, net — 90

Additions to long-term debt — 991

Reductions of long-term debt ( 32 ) ( 46 )

Dividends paid ( 508 ) ( 497 )

Repurchase of stock — ( 2,646 )

Shares withheld for taxes on share-based compensation ( 91 ) ( 118 )

Stock option exercises — 2

Cash required for financing activities ( 631 ) ( 571 )

16 unchanged sentences

Net earnings — — — 950 — 950

Other comprehensive income — — — — 201 201

Other comprehensive loss — — — — ( 3 ) ( 3 )

Dividends declared — — — ( 507 ) — ( 507 )

Repurchase of stock ( 0.1 ) — — ( 10 ) — ( 10 )

Accelerated share repurchase pending final settlement ( 8.9 ) ( 1 ) ( 751 ) ( 1,998 ) — ( 2,750 )

Stock options and awards 1.3 — ( 67 ) — — ( 67 )

3 unchanged sentences

Dividends declared — — — ( 516 ) — ( 516 )

Repurchase of stock ( 3.6 ) ( 1 ) 870 ( 755 ) — 114

Stock options and awards — — 69 — — 69

1 unchanged sentence

Net earnings — — — 971 — 971

Other comprehensive income — — — — 161 161

Other comprehensive loss — — — — ( 5 ) ( 5 )

Dividends declared — — — ( 513 ) — ( 513 )

5 unchanged sentences

Stock options and awards — — 80 — — 80

January 28, 2023 460.3 $ 38 $ 6,608 $ 5,005 $ ( 419 ) $ 11,232

February 3, 2024 461.7 $ 38 $ 6,761 $ 7,093 $ ( 460 ) $ 13,432

TARGET CORPORATION

6 unchanged sentences

(millions) (unaudited) Shares Value Capital Earnings (Loss) / Income

January 28, 2023 460.3 $ 38 $ 6,608 $ 5,005 $ ( 419 ) $ 11,232

Net earnings — — — 950 — 950

Other comprehensive loss — — — — ( 3 ) ( 3 )

Dividends declared — — — ( 507 ) — ( 507 )

Stock options and awards 1.3 — ( 67 ) — — ( 67 )

April 29, 2023 461.6 $ 38 $ 6,541 $ 5,448 $ ( 422 ) $ 11,605

Net earnings — — — 835 — 835

Other comprehensive loss — — — — ( 3 ) ( 3 )

Dividends declared — — — ( 516 ) — ( 516 )

Stock options and awards — — 69 — — 69

July 29, 2023 461.6 $ 38 $ 6,610 $ 5,767 $ ( 425 ) $ 11,990

February 3, 2024 461.7 $ 38 $ 6,761 $ 7,093 $ ( 460 ) $ 13,432

Net earnings — — — 942 — 942

Other comprehensive loss — — — — ( 5 ) ( 5 )

— — — — ( 5 ) ( 5 )

Dividends declared — — — ( 516 ) — ( 516 )

Stock options and awards 0.9 1 ( 14 ) — — ( 13 )

October 28, 2023 461.7 $ 38 $ 6,681 $ 6,225 $ ( 430 ) $ 12,514

We declared $ 1.10 and $ 1.08 dividends per share for the three months ended October 28, 2023 and October 29, 2022, respectively, and $ 4.14 per share for the fiscal year ended January 28, 2023.

May 4, 2024 462.6 $ 39 $ 6,747 $ 7,519 $ ( 465 ) $ 13,840

We declared $ 1.10 and $ 1.08 dividends per share for the three months ended May 4, 2024, and April 29, 2023, respectively, and $ 4.38 per share for the fiscal year ended February 3, 2024.

See accompanying Notes to Consolidated Financial Statements .

8 unchanged sentences

Supplier Finance Programs

Property and Equipment

Commercial Paper and Long-Term Debt

Derivative Financial Instruments

Share Repurchase

Pension Benefits

21 unchanged sentences

We also earn revenues from a variety of other sources, most notably credit card profit-sharing income from our arrangement with TD Bank Group (TD).

Revenue Three Months Ended Nine Months Ended

(millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022

Revenue Three Months Ended

(millions) May 4, 2024 April 29, 2023

Apparel & accessories (a)

$ 3,897 $ 3,967

Beauty & household essentials (b)

7,619 7,465 22,814 21,726

Food & beverage (c)

5,736 5,748 17,125 16,521

Hardlines (d)

3,192 3,665 9,966 11,244

Home furnishings & décor (e)

4,420 4,832 12,230 13,750

Other 30 45 126 141

Household essentials (f)

Sales 24,143 24,948

3 unchanged sentences

Total revenue $ 24,531 $ 25,322

(a) Includes apparel for women, men, boys, girls, toddlers, infants and newborns, as well as jewelry, accessories, and shoes.

(b) Includes beauty and personal care, baby gear, cleaning, paper products, and pet supplies.

(c) Includes dry grocery, dairy, frozen food, beverages, candy, snacks, deli, bakery, meat, produce, and food service in our stores.

(d) Includes electronics (including video game hardware and software), toys, entertainment, sporting goods, and luggage.

(e) Includes furniture, lighting, storage, kitchenware, small appliances, home décor, bed and bath, home improvement, school/office supplies, greeting cards and party supplies, and other seasonal merchandise.

(a) Includes apparel for women, men, young adults, kids, toddlers, and babies, as well as jewelry, accessories, and shoes.

(b) Includes skin and bath care, cosmetics, hair care, oral care, deodorant, and shaving products.

(c) Includes dry and perishable grocery, including snacks, candy, beverages, deli, bakery, meat, produce and food service (primarily Starbucks) in our stores.

(d) Includes electronics, including video games and consoles, toys, sporting goods, entertainment, and luggage.

(e) Includes bed and bath, home décor, school/office supplies, storage, small appliances, kitchenware, greeting cards, party supplies, furniture, lighting, home improvement, and seasonal merchandise.

(f) Includes household cleaning, paper products, over-the-counter healthcare, vitamins and supplements, baby gear, and pet supplies .

Merchandise sales — We record almost all retail store revenues at the point of sale.

1 unchanged sentence

Sales are recognized net of expected returns, which we estimate using historical return patterns and our expectation of future returns.

As of October 28, 2023, January 28, 2023, and October 29, 2022, the accrual for estimated returns was $ 207 million, $ 174 million, and $ 209 million, respectively.

As of May 4, 2024, February 3, 2024, and April 29, 2023, the accrual for estimated returns was $ 198 million, $ 170 million, and $ 206 million, respectively.

Revenue from Target gift card sales is recognized upon gift card redemption, which is typically within one year of issuance.

Gift Card Liability Activity January 28,

Gift Card Liability Activity February 3,

2024 Gift Cards Issued During Current Period But Not Redeemed (b)

Revenue Recognized From Beginning Liability October 28,

Revenue Recognized From Beginning Liability May 4,

Gift card liability (a)

10 unchanged sentences

TD underwrites, funds, and owns Target Credit Card and Target MasterCard receivables, controls risk management policies, and oversees regulatory compliance.

Other — Includes advertising revenue, Shipt membership and service revenues, commissions earned on third-party sales through Target.com, rental income, and other miscellaneous revenues.

Other — Includes advertising revenue, commissions earned on third-party sales through Target.com, Shipt membership and service revenues, rental income, and other miscellaneous revenues.

Fair Value Measurements

1 unchanged sentence

Financial Instruments Measured On a Recurring Basis Fair Value

(millions) Classification Measurement Level October 28, 2023 January 28, 2023 October 29, 2022

(millions) Classification Measurement Level May 4, 2024 February 3, 2024 April 29, 2023

Short-term investments Cash and Cash Equivalents Level 1 $ 2,726 $ 2,897 $ 408

Prepaid forward contracts Other Current Assets Level 1 27 25 25

Interest rate swaps Other Current Assets Level 2 — — 53

Interest rate swaps Other Noncurrent Assets Level 2 — — 7

2 unchanged sentences

Significant Financial Instruments Not Measured at Fair Value (a)

October 28, 2023 January 28, 2023 October 29, 2022

May 4, 2024 February 3, 2024 April 29, 2023

Value Carrying

11 unchanged sentences

The arrangements can be terminated by either party with notice ranging up to 120 days.

Our outstanding vendor obligations eligible for early payment under these arrangements totaled $ 4.5 billion, $ 3.4 billion, and $ 4.5 billion as of October 28, 2023, January 28, 2023, and October 29, 2022, respectively, and are included within Accounts Payable on our Consolidated Statements of Financial Position.

Our outstanding vendor obligations do not represent actual receivables sold by our vendors to the financial institutions, which may be lower.

Our outstanding vendor obligations eligible for early payment under these arrangements totaled $ 3.3 billion, $ 3.4 billion, and $ 3.3 billion as of May 4, 2024, February 3, 2024, and April 29, 2023, respectively, and are included within Accounts Payable on our Consolidated Statements of Financial Position.

Our outstanding vendor obligations do not represent actual receivables sold by our vendors to the financial institutions, which have historically been lower.

TARGET CORPORATION

2 unchanged sentences

NOTES Index to Notes

Property and Equipment

We review long-lived assets for impairment when store performance expectations, events, or changes in circumstances—such as a decision to relocate or close a store, office, or distribution center, discontinue a project, or make significant software changes—indicate that the asset’s carrying value may not be recoverable.

We recognized impairment charges of $ 64 million and $ 98 million for the three and nine months ended October 28, 2023, respectively.

We recognized impairment charges of $ 5 million and $ 55 million for the three and nine months ended October 29, 2022, respectively.

These impairment charges are included in Selling, General and Administrative Expenses (SG&A).

Commercial Paper and Long-Term Debt

We obtain short-term financing from time to time under our commercial paper program.

For the three months ended October 28, 2023, there were no commercial paper amounts outstanding.

For the three months ended October 29, 2022, the maximum amount outstanding was $ 2.1 billion and the average daily amount outstanding was $ 1.1 billion, at a weighted average annual interest rate of 2.8 percent.

For the nine months ended October 28, 2023 and October 29, 2022, the maximum amounts outstanding were $ 90 million and $ 2.1 billion, respectively, and the average daily amounts outstanding were $ 1 million and $ 713 million, respectively, at a weighted average annual interest rate of 4.8 percent and 1.9 percent, respectively.

No balances were outstanding as of October 28, 2023.

As of October 29, 2022, $ 2.1 billion was outstanding and is classified within Current Portion of Long-Term Debt and Other Borrowings on our Consolidated Statements of Financial Position.

In October 2023, we obtained a new committed $ 1.0 billion 364 -day unsecured revolving credit facility that will expire in October 2024 and terminated our prior 364 -day credit facility.

We also exercised our option to extend our existing five-year unsecured revolving credit facility, which has a maximum committed capacity of $ 3.0 billion and now expires in October 2028.

No balances were outstanding under either credit facility at any time during 2023 or 2022.

There was no commercial paper outstanding at any time during the three months ended May 4, 2024, For the three months ended April 29, 2023, the maximum amount outstanding was $ 90 million, and the average daily amount outstanding was $ 2 million, at a weighted average annual interest rate of 4.8 percent.

As of April 29, 2023, $ 90 million was outstanding and is classified within Current Portion of Long-Term Debt and Other Borrowings on our Consolidated Statements of Financial Position.

Derivative Financial Instruments

2 unchanged sentences

Note 3 to the Consolidated Financial Statements provides the fair value and classification of these instruments.

We were party to interest rate swaps with notional amounts totaling $ 2.45 billion as of October 28, 2023, January 28, 2023, and October 29, 2022.

We were party to interest rate swaps with notional amounts totaling $ 2.45 billion as of May 4, 2024, February 3, 2024, and April 29, 2023.

We pay a floating rate and receive a fixed rate under each of these agreements.

All of the agreements are designated as fair value hedges, and all were considered to be perfectly effective under the shortcut method during the three and nine months ended October 28, 2023 and October 29, 2022.

During 2023, we amended interest rate swaps with notional amounts totaling $ 1.5 billion to replace the London Interbank Offered Rate (LIBOR) with the daily Secured Overnight Financing Rate (SOFR) as part of our planned reference rate reform activities.

These amendments did not result in any change to our application of hedge accounting or any impact to our consolidated financial statements.

We were party to forward-starting interest rate swaps with notional amounts totaling $ 1.45 billion as of October 29, 2022.

During 2022, we terminated all remaining forward-starting interest rate swap agreements.

The resulting gains upon termination were recorded in Accumulated Other Comprehensive Loss and will be recognized as a reduction to Net Interest Expense over the respective term of the debt.

TARGET CORPORATION

Q3 2023 Form 10-Q 11

FINANCIAL STATEMENTS Table of Contents

NOTES Index to Notes

All of the agreements are designated as fair value hedges, and all were considered to be perfectly effective under the shortcut method during the three months ended May 4, 2024 and April 29, 2023.

Effect of Hedges on Debt

October 28, 2023 January 28, 2023 October 29, 2022

May 4, 2024 February 3, 2024 April 29, 2023

Long-term debt and other borrowings

1 unchanged sentence

Cumulative hedging adjustments, included in carrying amount ( 157 ) ( 126 ) ( 65 )

Effect of Hedges on Net Interest Expense Three Months Ended Nine Months Ended

(millions) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022

Effect of Hedges on Net Interest Expense Three Months Ended

(millions) May 4, 2024 April 29, 2023

Gain (loss) on fair value hedges recognized in Net Interest Expense

3 unchanged sentences

Total $ 6 $ 6

Share Repurchase

We periodically repurchase shares of our common stock under a board-authorized repurchase program through a combination of open market transactions, accelerated share repurchase (ASR) arrangements, and other privately negotiated transactions with financial institutions.

We did no t repurchase any of our shares during the nine months ended October 28, 2023.

Share Repurchase Activity Three Months Ended Nine Months Ended

(millions, except per share data) October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022

Number of shares purchased — — — 12.5

Average price paid per share $ — $ — $ — $ 211.57

Total investment $ — $ — $ — $ 2,646

Pension Benefits

We provide pension plan benefits to eligible team members.

Net Pension Benefits Expense Three Months Ended Nine Months Ended

(millions) Classification October 28, 2023 October 29, 2022 October 28, 2023 October 29, 2022

Service cost benefits earned SG&A $ 19 $ 22 $ 58 $ 68

Net Pension Benefits Expense Three Months Ended

(millions) Classification May 4, 2024 April 29, 2023

Service cost benefits earned Selling, General, and Administrative (SG&A) Expenses

Interest cost on projected benefit obligation Net Other Income 41 41

Expected return on assets Net Other Income ( 70 ) ( 67 )

Amortization of losses Net Other Income — 16 1 46

Prior service cost Net Other Income — 3

6 unchanged sentences

Change in Accumulated Other Comprehensive Income (Loss) Cash Flow Hedges Currency Translation Adjustment Pension Total

January 28, 2023 $ 300 $ ( 23 ) $ ( 696 ) $ ( 419 )

Other comprehensive income (loss) before reclassifications, net of tax — ( 1 ) — ( 1 )

February 3, 2024 $ 283 $ ( 24 ) $ ( 719 ) $ ( 460 )

Amounts reclassified from AOCI, net of tax ( 5 ) — — ( 5 )

October 28, 2023 $ 287 $ ( 24 ) $ ( 693 ) $ ( 430 )

May 4, 2024 $ 278 $ ( 24 ) $ ( 719 ) $ ( 465 )

TARGET CORPORATION

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements