What changed in this filing

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Item 1. Financial Statements

2024-08-30 compared with 2024-05-31 · 70 added, 41 removed, 274 unchanged (29% of the section changed)

1 unchanged sentence

Consolidated Statements of Operations

Three Months Ended

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

Three Months Ended Six Months Ended

(millions, except per share data) (unaudited) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Sales $ 25,021 $ 24,384 $ 49,164 $ 49,332

22 unchanged sentences

Consolidated Statements of Comprehensive Income

Three Months Ended

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

Three Months Ended Six Months Ended

(millions) (unaudited) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Net earnings $ 1,192 $ 835 $ 2,134 $ 1,785

10 unchanged sentences

Consolidated Statements of Financial Position

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

(millions, except footnotes) (unaudited) August 3,

2024 February 3,

2024 April 29,

2024 July 29,

Cash and cash equivalents $ 3,497 $ 3,805 $ 1,617

31 unchanged sentences

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

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.

461,600,215 , 461,675,441 , and 461,600,640 shares issued and outstanding as of August 3, 2024, February 3, 2024, and July 29, 2023, respectively.

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

6 unchanged sentences

Consolidated Statements of Cash Flows

Three Months Ended

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

Six Months Ended

(millions) (unaudited) August 3, 2024 July 29, 2023

Operating activities

4 unchanged sentences

Deferred income taxes 16 141

Noncash (gains) / losses and other, net

( 31 ) ( 11 )

Noncash losses / (gains) and other, net 22 11

Changes in operating accounts:

10 unchanged sentences

Financing activities

Change in commercial paper, net — 90

Reductions of long-term debt ( 1,076 ) ( 72 )

Dividends paid ( 1,017 ) ( 996 )

Repurchase of stock ( 155 ) —

Shares withheld for taxes on share-based compensation ( 94 ) ( 121 )

50 unchanged sentences

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.

Net earnings — — — 1,192 — 1,192

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

Dividends declared — — — ( 527 ) — ( 527 )

Repurchase of stock ( 1.1 ) ( 1 ) — ( 154 ) — ( 155 )

Stock options and awards 0.1 — 84 — — 84

August 3, 2024 461.6 $ 38 $ 6,831 $ 8,030 $ ( 470 ) $ 14,429

We declared $ 1.12 and $ 1.10 dividends per share for the three months ended August 3, 2024, and July 29, 2023, respectively, and $ 4.38 per share for the fiscal year ended February 3, 2024.

See accompanying Notes to Consolidated Financial Statements .

7 unchanged sentences

Fair Value Measurements

Property and Equipment

Supplier Finance Programs

1 unchanged sentence

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

(millions) May 4, 2024 April 29, 2023

Revenue Three Months Ended Six Months Ended

(millions) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Apparel & accessories (a)

$ 4,261 $ 4,101 $ 8,158 $ 8,068

3,384 3,085 6,503 6,101

Food & beverage (c)

5,538 5,392 11,391 11,389

Hardlines (d)

3,322 3,383 6,482 6,774

Home furnishings & décor (e)

3,908 3,955 7,427 7,810

Household essentials (f)

4,564 4,428 9,113 9,094

Other 44 40 90 96

Sales 25,021 24,384 49,164 49,332

12 unchanged sentences

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

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.

As of August 3, 2024, February 3, 2024, and July 29, 2023, the accrual for estimated returns was $ 193 million, $ 170 million, and $ 177 million, respectively.

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

1 unchanged sentence

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

Revenue Recognized From Beginning Liability May 4,

Revenue Recognized From Beginning Liability August 3,

Gift card liability (a)

8 unchanged sentences

Credit card profit sharing — We receive payments under a credit card program agreement with TD.

Under the agreement, we receive a percentage of the profits generated by the Target Credit Card and Target MasterCard receivables in exchange for performing account servicing and primary marketing functions.

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

Under the agreement, we receive a percentage of the profits generated by the Target Circle Credit Card and Target MasterCard receivables in exchange for performing account servicing and primary marketing functions.

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

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

2 unchanged sentences

Financial Instruments Measured On a Recurring Basis Fair Value

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

(millions) Classification Measurement Level August 3, 2024 February 3, 2024 July 29, 2023

Short-term investments Cash and Cash Equivalents Level 1 $ 2,465 $ 2,897 $ 739

4 unchanged sentences

Significant Financial Instruments Not Measured at Fair Value (a)

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

August 3, 2024 February 3, 2024 July 29, 2023

Value Carrying

5 unchanged sentences

These amounts exclude commercial paper, fair value hedge adjustments, and lease liabilities.

TARGET CORPORATION

Q2 2024 Form 10-Q 10

FINANCIAL STATEMENTS Table of Contents

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 $ 36 million for the three and six months ended August 3, 2024, and $ 33 million for the three and six months ended July 29, 2023.

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

Supplier Finance Programs

4 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 $ 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 eligible for early payment under these arrangements totaled $ 3.7 billion, $ 3.4 billion, and $ 3.7 billion as of August 3, 2024, February 3, 2024, and July 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

Q1 2024 Form 10-Q 10

FINANCIAL STATEMENTS Table of Contents

NOTES Index to Notes

Commercial Paper and Long-Term Debt

In July 2024, we repaid $ 1.0 billion of 3.5 percent unsecured fixed rate debt at maturity.

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

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.

There was no commercial paper outstanding at any time during the six months ended August 3, 2024.

For the six months ended July 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 4.9 percent.

No balances were outstanding as of July 29, 2023.

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

In July 2024, an interest rate swap with a notional amount of $ 250 million matured.

We were party to interest rate swaps with notional amounts totaling $ 2.20 billion as of August 3, 2024, and $ 2.45 billion as of both February 3, 2024, and July 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 months ended May 4, 2024 and April 29, 2023.

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 six months ended August 3, 2024, and July 29, 2023.

Effect of Hedges on Debt

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

August 3, 2024 February 3, 2024 July 29, 2023

Long-term debt and other borrowings

1 unchanged sentence

Cumulative hedging adjustments, included in carrying amount ( 79 ) ( 126 ) ( 136 )

Effect of Hedges on Net Interest Expense Three Months Ended

(millions) May 4, 2024 April 29, 2023

TARGET CORPORATION

Q2 2024 Form 10-Q 11

FINANCIAL STATEMENTS Table of Contents

NOTES Index to Notes

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

(millions) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

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

3 unchanged sentences

Total $ 6 $ 6 $ 12 $ 12

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.

Share Repurchase Activity Three Months Ended Six Months Ended

(millions, except per share data) August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Number of shares purchased 1.1 — 1.1 —

Average price paid per share $ 145.94 $ — $ 145.94 $ —

Total investment $ 155 $ — $ 155 $ —

Pension Benefits

We provide pension plan benefits to eligible team members.

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

Net Pension Benefits Expense Three Months Ended Six Months Ended

(millions) Classification August 3, 2024 July 29, 2023 August 3, 2024 July 29, 2023

Service cost benefits earned SG&A Expenses $ 19 $ 19 $ 39 $ 39

Interest cost on projected benefit obligation Net Other Income 42 42 83 83

Expected return on assets Net Other Income ( 70 ) ( 67 ) ( 140 ) ( 134 )

Amortization of losses Net Other Income — 1 — 1

Prior service cost Net Other Income 8 8 8 11

Total $ ( 1 ) $ 3 $ ( 10 ) $ —

TARGET CORPORATION

Q1 2024 Form 10-Q 11

FINANCIAL STATEMENTS Table of Contents

NOTES Index to Notes

Accumulated Other Comprehensive Income (Loss)

1 unchanged sentence

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

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

Amounts reclassified from AOCI, net of tax ( 9 ) — — ( 9 )

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

August 3, 2024 $ 274 $ ( 25 ) $ ( 719 ) $ ( 470 )

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