View Filing Data

Other intangible assets, net

156

Other assets

Total Assets

3,762

3,775

3,704

Current liabilities

Accounts payable

348

279

359

Accrued and other liabilities

326

420

380

Current portion of capital lease obligations

Liabilities, Current, Total

675

700

741

Long-term debt and obligations under capital leases

128

129

130

Other liabilities

381

393

254

Total liabilities

1,184

1,222

1,125

Shareholders' equity

Common stock and paid-in capital: 174,250,091; 173,397,913 and 172,536,861 shares outstanding, respectively

1,147

1,108

1,060

Retained earnings

3,426

3,182

3,013

Accumulated other comprehensive loss

(343)

(366)

(338)

Less: Treasury stock at cost: 41,174,061; 36,421,104 and 33,207,045 shares, respectively

(1,652)

(1,371)

(1,156)

Total shareholders’ equity

2,578

2,553

2,579

Liabilities and Equity, Total

$ 3,762

$ 3,775

$ 3,704

[1]

The balance sheet at January 30, 2016 has been derived from the previously reported audited 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 30, 2016.

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - shares	Jul. 30, 2016	Jan. 30, 2016	Aug. 01, 2015
CONSOLIDATED BALANCE SHEETS [Abstract]
Common Stock, Shares Outstanding, Issued, Total	174,250,091	173,397,913	172,536,861
Treasury Stock, Shares	41,174,061	36,421,104	33,207,045

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)
shares in Millions, $ in Millions

3 Months Ended

6 Months Ended

Jul. 30, 2016

Aug. 01, 2015

Jul. 30, 2016

Aug. 01, 2015

CONSOLIDATED STATEMENTS OF OPERATIONS [Abstract]

Selling, general and administrative expenses

$ 1,780

$ 1,695

$ 3,767

$ 3,611

Cost of sales

1,193

1,142

2,484

2,388

350

331

711

676

Depreciation and amortization

Interest expense, net

Other income

^[1]

(1)

(3)

(1)

Costs and Expenses, Total

1,582

1,510

3,271

3,136

Income before income taxes

198

185

496

475

Income tax expense

178

172

Net income

$ 127

$ 119

$ 318

$ 303

Basic earnings per share

$ 0.94

$ 0.85

$ 2.35

$ 2.17

Weighted-average shares outstanding

134.4

139.6

135.4

139.8

Diluted earnings per share

$ 0.94

$ 0.84

$ 2.33

$ 2.14

Weighted-average shares outstanding, assuming dilution

135.5

141.3

136.6

141.7

[1]	Other income includes non-operating items, such as lease termination gains, royalty income, insurance recoveries, and the changes in fair value, premiums paid, and realized gains associated with foreign currency option contracts.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2016	Aug. 01, 2015	Jul. 30, 2016	Aug. 01, 2015
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract]
Net income	$ 127	$ 119	$ 318	$ 303
Foreign currency translation adjustment:
Translation adjustment arising during the period, net of income tax	(27)	(23)	17	(22)
Cash flow hedges:
Change in fair value of derivatives, net of income tax	3		3	(1)
Available for sale securities:
Unrealized gain on available-for-sale securities	1		1
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, $1, $2 and $2 million, respectively, and foreign currency fluctuations	3	3	2	4
Comprehensive income	$ 107	$ 99	$ 341	$ 284

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2016	Aug. 01, 2015	Jul. 30, 2016	Aug. 01, 2015
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract]
Amortization of net actuarial gain/loss and prior service cost included in net periodic benefit costs, net of income tax expense	$ 1	$ 1	$ 2	$ 2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Millions

6 Months Ended

Jul. 30, 2016

Aug. 01, 2015

From Operating Activities

Net income

$ 318

$ 303

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

Share-based compensation expense

Excess tax benefits on share-based compensation

(10)

(24)

Qualified pension plan contributions

(25)

Change in assets and liabilities:

Merchandise inventories

(50)

(75)

Accounts payable

Accrued and other liabilities

(13)

(16)

Other, net

(7)

Net cash provided by operating activities

369

334

From Investing Activities

Capital expenditures

(131)

(116)

Net cash used in investing activities

(131)

(116)

From Financing Activities

Purchase of treasury shares

(276)

(205)

Dividends paid on common stock

(74)

(70)

Proceeds from exercise of stock options

Treasury stock reissued under employee stock plan

Excess tax benefits on share-based compensation

Payment of revolving credit agreement costs

(2)

Reduction in long-term debt and obligations under capital leases

(1)

Net cash used in financing activities

(324)

(209)

Effect of Exchange Rate Fluctuations on Cash and Cash Equivalents

(6)

Net Change in Cash and Cash Equivalents

(76)

Cash and Cash Equivalents at Beginning of Period

1,021

^[1]

967

Cash and Cash Equivalents at End of Period

945

970

Cash Paid During the Period:

Interest

Income taxes

$ 216

$ 178

[1]

Summary of Significant Accounting Policies	6 Months Ended
Summary of Significant Accounting Policies	Jul. 30, 2016
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 adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the interim periods of the fiscal year ending January 28, 2017 and of the fiscal year ended January 30, 2016. Certain items included in these statements are based on management’s estimates. 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 accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Notes to Consolidated Financial Statements contained in Foot Locker, Inc.’s (the “Company”) Form 10-K for the year ended January 30, 2016, as filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 24, 2016. Recent Accounting Pronouncements In November 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. ASU 2015-17 requires all deferred tax liabilities and assets to be presented in the balance sheet as noncurrent. The Company early adopted this standard on a prospective basis as of the quarter ended April 30, 2016. As a result, the Company reclassified deferred tax assets and deferred tax liabilities classified as current to noncurrent. No prior periods were retrospectively adjusted. In February 2016, the FASB issued ASU 2016-02, Leases. This ASU revises the existing guidance related to leases by requiring lessees to recognize a lease liability and a right-of-use asset for all leases, as well as additional disclosure regarding leasing arrangements. This standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and requires a modified retrospective adoption, with earlier adoption permitted. The Company is currently evaluating the effects of the adoption of this ASU on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 simplifies certain aspects of the accounting for share-based payment transactions, including tax consequences, classification of awards, the option to recognize stock compensation expense with actual forfeitures as they occur, and the classifications on the statement of cash flows. ASU 2016-09 is effective for annual reporting beginning after December 15, 2016, including interim periods within that reporting period, with early adoption permitted. The manner of adoption varies, with certain provisions applied on a retrospective or modified retrospective approach, while others are applied prospectively. The Company is currently evaluating the effects of the adoption of this ASU on its consolidated financial statements. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing. ASU 2016-10 clarifies the implementation guidance on identifying performance obligations and licensing on the previously issued ASU 2014-09, Revenue from Contracts with Customers. In May 2016, the FASB issued ASU 2016-11, Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting. ASU 2016-11 rescinds several SEC Staff Announcements that are codified in Topic 605, including, among other items, guidance relating to accounting for shipping and handling fees and freight services. ASU 2016-10 and ASU 2016-11 are effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that year. ASU 2016-10 and ASU 2016-11 can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the effects of the adoption of these ASUs on its consolidated financial statements. Other recently issued accounting pronouncements did not, or are not believed by management to, have a material effect on the Company’s present or future consolidated financial statements.

Segment Information

6 Months Ended

Jul. 30, 2016

Segment Information [Abstract]

Segment Information

2. Segment Information

The Company has determined that its reportable segments are those that are based on its method of internal reporting. The Company has two reportable segments, Athletic Stores and Direct-to-Customers. The Company evaluates performance based on several factors, of which the primary financial measure is division results. Division profit reflects income before income taxes, corporate expense, non-operating income, and net interest expense.



	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		August 1,		July 30,		August 1,
	2016		2015		2016		2015
	($ in millions)
Sales
Athletic Stores	$	1,576	$	1,503	$	3,311	$	3,184
Direct-to-Customers		204		192		456		427
Total sales	$	1,780	$	1,695	$	3,767	$	3,611
Operating Results
Athletic Stores	$	193	$	176	$	470	$	443
Direct-to-Customers		22		27		60		67
Division profit		215		203		530		510
Less: Corporate expense		17		17		36		34
Operating profit		198		186		494		476
Interest expense, net		1		1		1		2
Other income (1)		1		—		3		1
Income before income taxes	$	198	$	185	$	496	$	475


(1)	Other income includes non-operating items, such as lease termination gains, royalty income, insurance recoveries, and the changes in fair value, premiums paid, and realized gains associated with foreign currency option contracts.

Goodwill and Other Intangible Assets, Net [Abstract]

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Goodwill

6 Months Ended

Jul. 30, 2016

Goodwill and Other Intangible Assets, Net [Abstract]

3. Goodwill

Annually during the first quarter, or more frequently if impairment indicators arise, the Company reviews goodwill and intangible assets with indefinite lives for impairment. The annual review of goodwill and intangible assets with indefinite lives performed during the first quarter of 2016 did not result in the recognition of impairment. The following table provides a summary of goodwill by reportable segment.



	July 30,		August 1,		January 30,
	2016		2015		2016
	($ in millions)
Athletic Stores	$	17	$	17	$	17
Direct-to-Customers		139		139		139
	$	156	$	156	$	156

Other Intangible Assets, net

6 Months Ended

Jul. 30, 2016

Other Intangible Assets, net

4. Other Intangible Assets, net

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



		July 30, 2016						August 1, 2015						January 30, 2016
		Gross		Accum.		Net		Gross		Accum.		Net		Gross		Accum.		Net
($ in millions)		value		amort.		Value		Value		amort.		Value		value		amort.		Value
Amortized intangible assets: (1)
	Lease acquisition costs	$	120	$	(108)	$	12	$	121	$	(111)	$	10	$	119	$	(107)	$	12
	Trademarks / trade names		20		(13)		7		21		(12)		9		20		(12)		8
	Favorable leases		7		(5)		2		7		(4)		3		7		(5)		2
		$	147	$	(126)	$	21	$	149	$	(127)	$	22	$	146	$	(124)	$	22



		July 30, 2016			August 1, 2015			January 30, 2016
			Net			Net			Net
			Value			Value			Value
Indefinite life intangible assets: (1)
	Runners Point Group trademarks / trade names		$	23		$	24		$	23
Other intangible assets, net			$	44		$	46		$	45

(1)

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

Amortization of $2 million was recorded for the twenty-six week period ended July 30, 2016. This was partially offset by $1 million of lease acquisition additions primarily related to our European businesses, which are being amortized over a weighted-average life of 10 years.



	Thirteen weeks ended				Twenty-six weeks ended
($ in millions)		July 30, 2016		August 1, 2015	July 30, 2016		August 1, 2015
Amortization expense	$	1	$	1	$	2	$	2

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


		($ in millions)
Remainder of 2016	$	2
2017		4
2018		3
2019		3
2020		3
2021		2

Accumulated Other Comprehensive Loss

6 Months Ended

Jul. 30, 2016

Accumulated Other Comprehensive Loss [Abstract]

Accumulated Other Comprehensive Loss

5. Accumulated Other Comprehensive Loss

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



	July 30,		August 1,		January 30,
	2016		2015		2016
	($ in millions)
Foreign currency translation adjustments	$	(102)	$	(97)	$	(119)
Cash flow hedges		5		(4)		2
Unrecognized pension cost and postretirement benefit		(246)		(236)		(248)
Unrealized loss on available-for-sale security		—		(1)		(1)
	$	(343)	$	(338)	$	(366)

The changes in AOCL for the twenty-six weeks ended July 30, 2016 were as follows:



	Foreign				Items Related		Unrealized
	Currency				to Pension and		Loss on
	Translation		Cash Flow		Postretirement		Available-For-
($ in millions)	Adjustments		Hedges		Benefits		Sale Security		Total
Balance as of January 30, 2016	$	(119)	$	2	$	(248)	$	(1)	$	(366)
OCI before reclassification		17		3		(2)		1		19
Reclassified from AOCI		—		—		4		—		4
Other comprehensive income/ (loss)		17		3		2		1		23
Balance as of July 30, 2016	$	(102)	$	5	$	(246)	$	—	$	(343)

Reclassifications from AOCL for the twenty-six weeks ended July 30, 2016 were as follows:



		($ in millions)
Amortization of actuarial (gain) loss:
Pension benefits- amortization of actuarial loss	$	7
Postretirement benefits- amortization of actuarial gain		(1)
Net periodic benefit cost (see Note 10)		6
Income tax benefit		(2)
Net of tax	$	4

The entire disclosure for comprehensive income, which includes, but is not limited to, 1) the amount of income tax expense or benefit allocated to each component of other comprehensive income, including reclassification adjustments, 2) the reclassification adjustments for each classification of other comprehensive income and 3) the ending accumulated balances for each component of comprehensive income.

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+ Details

Revolving Credit Facility	6 Months Ended
Revolving Credit Facility	Jul. 30, 2016
Revolving Credit Facility [Abstract]
Revolving Credit Facility	6. Revolving Credit Facility On May 19, 2016, the Company entered into a new credit agreement with its banks (“2016 Credit Agreement”) that replaced the Company’s prior credit agreement (“2011 Restated Credit Agreement”). The 2016 Credit Agreement provides for a $400 million asset-based revolving credit facility maturing on May 19, 2021. Additionally, during the term of the 2016 Credit Agreement, the Company may increase the commitments by up to $200 million, subject to customary conditions. Interest is determined, at the Company’s option, by the federal funds rate plus a margin of 0.125 percent to 0.375 percent, or a Eurodollar rate, determined by reference to LIBOR, plus a margin of 1.125 percent to 1.375 percent depending on availability under the 2016 Credit Agreement. In addition, the Company will pay a commitment fee of 0.20 percent per annum on the unused portion of the commitments. The 2016 Credit Agreement provides for a security interest in certain of the Company’s domestic assets, including inventory assets, accounts receivable, cash deposits, and certain insurance proceeds. The Company is not required to comply with any financial covenants unless certain events of default have occurred and are continuing, or if availability under the 2016 Credit Agreement does not exceed the greater of $40 million and 10 percent of the Loan Cap (as defined in the 2016 Credit Agreement). There are no restrictions relating to the payment of dividends and share repurchases, as long as no default or event of default has occurred and the aggregate principal amount of unused commitments under the 2016 Credit Agreement is not less than 15 percent of the lesser of the aggregate amount of the commitments and the Borrowing Base, determined as of the end of such fiscal month and on a proforma basis for the following six fiscal months. The Company uses the credit facility to support standby letters of credit in connection with insurance programs and the amount outstanding as of July 30, 2016 was not significant. The Company’s management does not currently expect to borrow under the facility in 2016. The Company paid approximately $2 million in fees relating to the new credit facility. Deferred financing fees are amortized over the life of the facility on a straight-line basis, which is comparable to the interest method. The unamortized balance at July 30, 2016 was $2 million. Interest expense including facility fees, related to the revolving credit facility was $1 million for both the thirteen and twenty-six weeks ended July 30, 2016 and August 1, 2015.

Financial Instruments

6 Months Ended

Jul. 30, 2016

Financial Instruments [Abstract]

Financial Instruments

7. Financial Instruments

The Company operates internationally and utilizes certain derivative financial instruments to mitigate its foreign currency exposures, primarily related to third-party and intercompany forecasted transactions. As a result of the use of derivative instruments, the Company is exposed to the risk that counterparties will fail to meet their contractual obligations. To mitigate this counterparty credit risk, the Company has a practice of entering into contracts only with major financial institutions selected based upon their credit ratings and other financial factors. The Company monitors the creditworthiness of counterparties throughout the duration of the derivative instrument. Additional information is contained within Note 8, Fair Value Measurements.

Derivative Holdings Designated as Hedges

For a derivative to qualify as a hedge at inception and throughout the hedged period, the Company formally documents the nature of the hedged items and the relationships between the hedging instruments and the hedged items, as well as its risk-management objectives, strategies for undertaking the various hedge transactions, and the methods of assessing hedge effectiveness and ineffectiveness. In addition, for hedges of forecasted transactions, the significant characteristics and expected terms of a forecasted transaction must be specifically identified, and it must be probable that each forecasted transaction would occur. If it were deemed probable that the forecasted transaction would not occur, the gain or loss on the derivative instrument would be recognized in earnings immediately. No such gains or losses were recognized in earnings for any of the periods presented. Derivative financial instruments qualifying for hedge accounting must maintain a specified level of effectiveness between the hedging instrument and the item being hedged, both at inception and throughout the hedged period, which management evaluates periodically.

The primary currencies to which the Company is exposed are the euro, British pound, Canadian dollar, and Australian dollar. For the most part, merchandise inventories are purchased by each geographic area in their respective local currency. The most significant exception to this is the United Kingdom, whose merchandise inventory purchases are denominated in euros. For option and foreign exchange forward contracts designated as cash flow hedges of the purchase of inventory, the effective portion of gains and losses is deferred as a component of AOCL and is recognized as a component of cost of sales when the related inventory is sold. The amount reclassified to cost of sales related to such contracts was not significant for any of the periods presented. The effective portion of gains or losses associated with other forward contracts is deferred as a component of AOCL until the underlying transaction is reported in earnings. The ineffective portion of gains and losses related to cash flow hedges recorded to earnings was also not significant for any of the periods presented. When using a forward contract as a hedging instrument, the Company excludes the time value of the contract from the assessment of effectiveness. At quarter-end, all of the Company’s hedged forecasted transactions were less than twelve months, and the Company expects all derivative-related amounts reported in AOCL to be reclassified to earnings within twelve months.

The net change in the fair value of the foreign exchange derivative financial instruments designated as cash flow hedges of the purchase of inventory was a $3 million gain for both the thirteen and the twenty-six weeks ended July 30, 2016, and therefore decreased AOCL. At July 30, 2016, there was a $5 million gain included in AOCL. For the thirteen weeks ended August 1, 2015, the net change in fair value was not significant, and was a $1 million loss for the twenty-six weeks ended August 1, 2015. The notional value of the foreign exchange contracts designed as hedges outstanding at July 30, 2016 was $82 million, and these contracts mature at various dates through July 2017.

Derivative Holdings Not Designated as Hedges

The Company enters into foreign exchange forward contracts that are not designated as hedges in order to manage the costs of foreign-currency denominated merchandise purchases and intercompany transactions. Changes in the fair value of these foreign exchange forward contracts are recorded in earnings immediately within selling, general and administrative expenses. The net change in fair value was not significant for the thirteen weeks ended July 30, 2016 and resulted in expense of $1 million for the twenty-six weeks ended July 30, 2016. The net change in fair value resulted in income of $1 million and $2 million for the thirteen and twenty-six weeks ended August 1, 2015, respectively. The notional value of the foreign exchange contracts not designed as hedges outstanding at July 30, 2016 was $14 million, and these contracts mature at various dates through December 2016.

The Company mitigates the effect of fluctuating foreign exchange rates on the reporting of foreign-currency denominated earnings by entering into currency option contracts. Changes in the fair value of these foreign currency option contracts, which are not designated as hedges, are recorded in earnings immediately within other income. The realized gains, premiums paid, and changes in the fair market value recorded were not significant for any of the periods presented. No such contracts were outstanding at July 30, 2016.

Additionally, the Company enters into diesel fuel forward and option contracts to mitigate a portion of the Company’s freight expense due to the variability caused by fuel surcharges imposed by our third-party freight carriers. Changes in the fair value of these contracts are recorded in earnings immediately. The effect was not significant for any of the periods presented. No such contracts were outstanding at July 30, 2016.

Fair Value of Derivative Contracts

The following represents the fair value of the Company’s derivative contracts. Many of the Company’s agreements allow for a netting arrangement. The following is presented on a gross basis, by type of contract:



	Balance Sheet	July 30,		August 1,		January 30,
($ in millions)	Caption	2016		2015		2016
Hedging Instruments:
Foreign exchange forward contracts	Current assets	$	6	$	—	$	3
Foreign exchange forward contracts	Current liabilities	$	—	$	5	$	—
Non-hedging Instruments:
Foreign exchange forward contracts	Current assets	$	—	$	1	$	—

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-Section 45
-Paragraph 1
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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+ Details

Fair Value Measurements

6 Months Ended

Jul. 30, 2016

Fair Value Measurements [Abstract]

Fair Value Measurements

8. Fair Value Measurements

The Company’s financial assets recorded at fair value are categorized as follows:


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


	Level 2 –	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.

The following tables provide a summary of the Company’s recognized assets and liabilities that are measured at fair value on a recurring basis:



	As of July 30, 2016						As of August 1, 2015						As of January 30, 2016
	($ in millions)
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Available-for-sale securities	$	—	$	7	$	—	$	—	$	6	$	—	$	—	$	6	$	—
Foreign exchange forward contracts		—		6		—		—		2		—		—		3		—
Total Assets	$	—	$	13	$	—	$	—	$	8	$	—	$	—	$	9	$	—

Liabilities
Foreign exchange forward contracts		—		—		—		—		6		—		—		—		—
Total Liabilities	$	—	$	—	$	—	$	—	$	6	$	—	$	—	$	—	$	—

Securities classified as available-for-sale are recorded at fair value with unrealized gains and losses reported, net of tax, in other comprehensive income, unless unrealized losses are determined to be other than temporary. The fair value of the auction rate security is determined by using quoted prices for similar instruments in active markets and accordingly is classified as a Level 2 instrument.

The Company’s 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.

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

The carrying value and estimated fair value of long-term debt and obligations under capital leases were as follows:


	July 30,		August 1,		January 30,
	2016		2015		2016
	($ in millions)
Carrying value	$	129	$	132	$	130
Fair value	$	151	$	157	$	156

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

Pension and Postretirement Plans [Abstract]

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Earnings Per Share

6 Months Ended

Jul. 30, 2016

Earnings Per Share [Abstract]

Earnings Per Share

9. Earnings Per Share

The Company accounts for and discloses earnings per share using the treasury stock method. Basic earnings per share is computed by dividing net income for the period by the weighted-average number of common shares outstanding. Restricted stock awards, which contain non-forfeitable rights to dividends, are considered participating securities and are included in the calculation of basic earnings per share. Diluted earnings per share reflects the weighted-average number of common shares outstanding during the period used in the basic earnings per share computation plus dilutive common stock equivalents.

The computation of basic and diluted earnings per share is as follows:



	Thirteen weeks ended					Twenty-six weeks ended
		July 30,		August 1,		July 30,		August 1,
		2016		2015		2016		2015
		(in millions, except per share data)
Net Income		$	127	$	119	$	318	$	303
Weighted-average common shares outstanding			134.4		139.6		135.4		139.8
Basic earnings per share		$	0.94	$	0.85	$	2.35	$	2.17
Weighted-average common shares outstanding			134.4		139.6		135.4		139.8
Dilutive effect of potential common shares			1.1		1.7		1.2		1.9
Weighted-average common shares outstanding assuming dilution			135.5		141.3		136.6		141.7
Diluted earnings per share		$	0.94	$	0.84	$	2.33	$	2.14

Options to purchase 1.1 million and 0.7 million shares of common stock were not included in the computation of diluted earnings per share for the thirteen weeks ended July 30, 2016 and August 1, 2015, respectively. Options to purchase 1.0 million and 0.6 million shares of common stock were not included in the computation of diluted earnings per share for the twenty-six weeks ended July 30, 2016 and August 1, 2015, respectively. These options were not included because the effect would have been antidilutive. Contingently issuable shares of 0.3 million and 0.4 million have not been included as the vesting conditions have not been satisfied as of July 30, 2016 and August 1, 2015, respectively.

Pension and Postretirement Plans

6 Months Ended

Jul. 30, 2016

Pension and Postretirement Plans

10. Pension and Postretirement Plans

The Company has defined benefit pension plans covering certain of its North American employees, which are funded in accordance with the provisions of the laws where the plans are in effect. In addition, the Company has a defined benefit pension plan covering certain employees of the Runners Point Group.

In addition to providing pension benefits, the Company sponsors postretirement medical and life insurance plans, which are available to most of its retired U.S. employees. These medical and life insurance plans are contributory and are not funded.

The following are the components of net periodic pension benefit cost and net periodic postretirement benefit income, which is recognized as part of SG&A expense:



	Pension Benefits								Postretirement Benefits
	Thirteen weeks ended				Twenty-six weeks ended				Thirteen weeks ended				Twenty-six weeks ended
	July 30,		August 1,		July 30,		August 1,		July 30,		August 1,		July 30,		August 1,
($ in millions)	2016		2015		2016		2015		2016		2015		2016		2015
Service cost	$	4	$	4	$	8	$	8	$	—	$	—	$	—	$	—
Interest cost		7		6		13		12		—		1		—		1
Expected return on plan assets		(9)		(10)		(18)		(19)		—		—		—		—
Amortization of net loss (gain)		3		4		7		7		—		(1)		(1)		(1)
Net benefit expense (income)	$	5	$	4	$	10	$	8	$	—	$	—	$	(1)	$	—

During the first quarter of 2016, the Company made a contribution of $25 million to the U.S. qualified plan. The Company continually evaluates the amount and timing of any future contributions. The Company contributed $8 million to the U.S. qualified plan on August 31, 2016. The Company currently expects to contribute $4 million to the Canadian qualified plan during the fourth quarter of 2016. Actual contributions are dependent on several factors, including the outcome of the ongoing pension litigation. See Note 12, Legal Proceedings, for further information.

Share-Based Compensation

6 Months Ended

Jul. 30, 2016

Share-Based Compensation [Abstract]

Share-Based Compensation

11. Share-Based Compensation

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



	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		August 1,		July 30,		August 1,
	2016		2015		2016		2015
	($ in millions)
Options and shares purchased under the employee stock purchase plan	$	2	$	3	$	5	$	6
Restricted stock and restricted stock units		4		2		6		5
Total share-based compensation expense	$	6	$	5	$	11	$	11

Tax benefit recognized	$	2	$	1	$	3	$	3
Excess income tax benefit from settled equity-classified share-based awards reported as a cash flow from financing activities					$	10	$	24

Valuation Model and Assumptions

The Company uses a Black-Scholes option-pricing model to estimate the fair value of share-based awards. The Black-Scholes option-pricing model incorporates various and highly subjective assumptions, including expected term and expected volatility. The following table shows the Company’s assumptions used to compute the share-based compensation expense for awards granted during the twenty-six weeks ended July 30, 2016 and August 1, 2015:



		Stock Option Plans						Stock Purchase Plan
		July 30,			August 1,			July 30,			August 1,
		2016			2015			2016			2015
Weighted-average risk free rate of interest		1.4	%		1.5	%		0.4	%		0.2	%
Expected volatility		30	%		30	%		26	%		24	%
Weighted-average expected award life (in years)		5.7			6.0			1.0			1.0
Dividend yield		1.7	%		1.6	%		1.7	%		1.7	%
Weighted-average fair value	$	15.68		$	16.01		$	15.19		$	9.53

The information in the following table covers options granted under the Company’s stock option plans for the twenty-six weeks ended July 30, 2016:



		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	3,694			$	32.62
Granted	482				63.47
Exercised	(669)				21.56
Expired or cancelled	(54)				59.03
Options outstanding at July 30, 2016	3,453		5.7	$	38.65
Options exercisable at July 30, 2016	2,420		4.3	$	29.34
Options vested and expected to vest at July 30, 2016	3,413		5.6	$	38.38
Options available for future grant at July 30, 2016	12,006

The total fair value of options vested as of July 30, 2016 and August 1, 2015 was $8 million and $14 million, respectively. The cash received from option exercises for the thirteen and twenty-six weeks ended July 30, 2016 was $7 million and $14 million, respectively. The cash received from option exercises for the thirteen and twenty-six weeks ended August 1, 2015 was $15 million and $38 million, respectively.

The total intrinsic value of options exercised (the difference between the market price of the Company’s 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,		August 1,		July 30,		August 1,
	2016		2015		2016		2015
	($ in millions)
Exercised	$	12	$	29	$	26	$	65

The total tax benefit realized from option exercises was $5 million and $10 million for the thirteen and twenty-six weeks ended July 30, 2016, respectively, and was $11 million and $25 million for the corresponding prior-year periods.

The aggregate intrinsic value for stock options outstanding, outstanding and exercisable, and vested and expected to vest (the difference between the Company’s 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,		August 1,
	2016		2015
	($ in millions)
Outstanding	$	76	$	173
Outstanding and exercisable	$	74	$	152
Vested and expected to vest	$	76	$	172

As of July 30, 2016 there was $9 million of total unrecognized compensation cost, net of estimated forfeitures, related to nonvested stock options, which is expected to be recognized over a remaining weighted-average period of 1.6 years. The following table summarizes information about stock options outstanding and exercisable at July 30, 2016:



	Options Outstanding				Options Exercisable
		Weighted-
		Average		Weighted-			Weighted-
		Remaining		Average			Average
	Number	Contractual		Exercise	Number		Exercise
Range of Exercise Prices	Outstanding	Life		Price	Exercisable		Price
	(in thousands, except prices per share and contractual life)
$9.85 to $15.10	721	2.1	$	12.99	721	$	12.99
$18.80 to $30.92	710	3.6		23.76	710		23.76
$34.12 to $56.35	936	6.4		41.54	739		39.53
$62.02 to $73.21	1,086	8.7		62.92	250		62.15
	3,453	5.7	$	38.65	2,420	$	29.34

Restricted Stock and Restricted Stock Units

Restricted shares of the Company’s common stock and restricted stock units (“RSU”) may be awarded to certain officers, key employees of the Company, and to nonemployee directors. Additionally, RSU awards are made to employees in connection with the Company’s long-term incentive program. Each RSU represents the right to receive one share of the Company’s common stock provided that the performance and vesting conditions are satisfied. There were 671,690 and 581,713 RSU awards outstanding as of July 30, 2016 and August 1, 2015, respectively.

Generally, awards fully vest after the passage of time, typically three years. However, RSU awards made in connection with the Company’s long-term incentive program are earned after the attainment of certain performance metrics and vest after the passage of time. Restricted stock is considered outstanding at the time of grant and the holders have voting rights. Dividends are paid to holders of restricted stock that vest with the passage of time. With regard to performance-based restricted stock, dividends will be accumulated and paid after the performance criteria are met. No dividends are paid or accumulated on RSU awards. Compensation expense is recognized using the market value at the date of grant and is amortized over the vesting period, provided the recipient continues to be employed by the Company.

Restricted stock and RSU activity for the thirteen weeks ended July 30, 2016 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		803		$	45.19
Granted		361			63.74
Vested		(212)			36.54
Expired or cancelled		(125)			39.28
Nonvested at July 30, 2016		827	1.5	$	56.39
Aggregate value ($ in millions)	$	47

The total value of awards for which restrictions lapsed during the twenty-six weeks ended July 30, 2016 and August 1, 2015 was $8 million and $10 million, respectively. As of July 30, 2016, there was $19 million of total unrecognized compensation cost net of forfeitures related to nonvested restricted awards.

Sales and Division Operating Results for Reportable Segments

The entire disclosure for compensation-related costs for equity-based compensation, which may include disclosure of policies, compensation plan details, allocation of equity compensation, incentive distributions, equity-based arrangements to obtain goods and services, deferred compensation arrangements, employee stock ownership plan details and employee stock purchase plan details.

+ References + Details

Legal Proceedings	6 Months Ended
Legal Proceedings	Jul. 30, 2016
Legal Proceedings [Abstract]
Legal Proceedings	12. 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 disposed of by the Company in past years. These legal proceedings include commercial, intellectual property, customer, environmental, and employment-related claims. The Company and the Company’s U.S. retirement plan are defendants in a class action (Osberg v. Foot Locker Inc. et ano., filed in the U.S. District Court for the Southern District of New York) in which the plaintiff alleges that, in connection with the 1996 conversion of the retirement plan to a defined benefit plan with a cash balance formula, the Company and the retirement plan failed to properly advise plan participants of the “wear-away” effect of the conversion. Plaintiff’s claims were for breach of fiduciary duty under the Employee Retirement Income Security Act of 1974, as amended, and violation of the statutory provisions governing the content of the Summary Plan Description. The trial was held in July 2015 and the court issued a decision in September 2015 in favor of the class on the foregoing claims. The court ordered that the Plan be reformed. The Company is appealing the court’s decision, and the judgment has been stayed pending the outcome of the appeal. As a result of this development, the Company determined that it is probable a liability exists. The Company’s reasonable estimate of this liability is a range between $100 million and $200 million, with no amount within that range more probable than any other amount. Therefore, in accordance with U.S. GAAP, the Company recorded a charge of $100 million pre-tax ($61 million after-tax) in the third quarter of 2015. This amount has been classified as a long-term liability. The Company will continue to vigorously defend itself in this case. In light of the uncertainties involved in this matter, there is no assurance that the ultimate resolution will not differ from the amount currently accrued by the Company. Management does 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 the Company’s 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, and judgments could be rendered or settlements entered into that could adversely affect the Company’s operating results or cash flows in a particular period.

Summary of Significant Accounting Policies (Policy)	6 Months Ended
Summary of Significant Accounting Policies (Policy)	Jul. 30, 2016
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 adjustments, which are of a normal recurring nature, necessary for a fair presentation of the results for the interim periods of the fiscal year ending January 28, 2017 and of the fiscal year ended January 30, 2016. Certain items included in these statements are based on management’s estimates. 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 accompanying unaudited condensed consolidated financial statements should be read in conjunction with the Notes to Consolidated Financial Statements contained in Foot Locker, Inc.’s (the “Company”) Form 10-K for the year ended January 30, 2016, as filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 24, 2016.
Recent Accounting Pronouncements	Recent Accounting Pronouncements In November 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes. ASU 2015-17 requires all deferred tax liabilities and assets to be presented in the balance sheet as noncurrent. The Company early adopted this standard on a prospective basis as of the quarter ended April 30, 2016. As a result, the Company reclassified deferred tax assets and deferred tax liabilities classified as current to noncurrent. No prior periods were retrospectively adjusted. In February 2016, the FASB issued ASU 2016-02, Leases. This ASU revises the existing guidance related to leases by requiring lessees to recognize a lease liability and a right-of-use asset for all leases, as well as additional disclosure regarding leasing arrangements. This standard will be effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, and requires a modified retrospective adoption, with earlier adoption permitted. The Company is currently evaluating the effects of the adoption of this ASU on its consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 simplifies certain aspects of the accounting for share-based payment transactions, including tax consequences, classification of awards, the option to recognize stock compensation expense with actual forfeitures as they occur, and the classifications on the statement of cash flows. ASU 2016-09 is effective for annual reporting beginning after December 15, 2016, including interim periods within that reporting period, with early adoption permitted. The manner of adoption varies, with certain provisions applied on a retrospective or modified retrospective approach, while others are applied prospectively. The Company is currently evaluating the effects of the adoption of this ASU on its consolidated financial statements. In April 2016, the FASB issued ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing. ASU 2016-10 clarifies the implementation guidance on identifying performance obligations and licensing on the previously issued ASU 2014-09, Revenue from Contracts with Customers. In May 2016, the FASB issued ASU 2016-11, Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting. ASU 2016-11 rescinds several SEC Staff Announcements that are codified in Topic 605, including, among other items, guidance relating to accounting for shipping and handling fees and freight services. ASU 2016-10 and ASU 2016-11 are effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted only as of annual reporting periods beginning after December 15, 2016, including interim periods within that year. ASU 2016-10 and ASU 2016-11 can be adopted either retrospectively to each prior reporting period presented or as a cumulative-effect adjustment as of the date of adoption. The Company is currently evaluating the effects of the adoption of these ASUs on its consolidated financial statements. Other recently issued accounting pronouncements did not, or are not believed by management to, have a material effect on the Company’s present or future consolidated financial statements.

Segment Information (Tables)

6 Months Ended

Jul. 30, 2016

Segment Information [Abstract]

The Company evaluates performance based on several factors, of which the primary financial measure is division results. Division profit reflects income before income taxes, corporate expense, non-operating income, and net interest expense.



	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		August 1,		July 30,		August 1,
	2016		2015		2016		2015
	($ in millions)
Sales
Athletic Stores	$	1,576	$	1,503	$	3,311	$	3,184
Direct-to-Customers		204		192		456		427
Total sales	$	1,780	$	1,695	$	3,767	$	3,611
Operating Results
Athletic Stores	$	193	$	176	$	470	$	443
Direct-to-Customers		22		27		60		67
Division profit		215		203		530		510
Less: Corporate expense		17		17		36		34
Operating profit		198		186		494		476
Interest expense, net		1		1		1		2
Other income (1)		1		—		3		1
Income before income taxes	$	198	$	185	$	496	$	475


(1)	Other income includes non-operating items, such as lease termination gains, royalty income, insurance recoveries, and the changes in fair value, premiums paid, and realized gains associated with foreign currency option contracts.

Goodwill (Tables)

6 Months Ended

Jul. 30, 2016

Goodwill and Other Intangible Assets, Net [Abstract]

Schedule of Goodwill

The following table provides a summary of goodwill by reportable segment.



	July 30,		August 1,		January 30,
	2016		2015		2016
	($ in millions)
Athletic Stores	$	17	$	17	$	17
Direct-to-Customers		139		139		139
	$	156	$	156	$	156

Other Intangible Assets, net (Tables)

6 Months Ended

Jul. 30, 2016

Goodwill and Other Intangible Assets, Net [Abstract]

Components of Finite-Lived Intangible Assets and Intangible Assets Not Subject to Amortization

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



		July 30, 2016						August 1, 2015						January 30, 2016
		Gross		Accum.		Net		Gross		Accum.		Net		Gross		Accum.		Net
($ in millions)		value		amort.		Value		Value		amort.		Value		value		amort.		Value
Amortized intangible assets: (1)
	Lease acquisition costs	$	120	$	(108)	$	12	$	121	$	(111)	$	10	$	119	$	(107)	$	12
	Trademarks / trade names		20		(13)		7		21		(12)		9		20		(12)		8
	Favorable leases		7		(5)		2		7		(4)		3		7		(5)		2
		$	147	$	(126)	$	21	$	149	$	(127)	$	22	$	146	$	(124)	$	22



		July 30, 2016			August 1, 2015			January 30, 2016
			Net			Net			Net
			Value			Value			Value
Indefinite life intangible assets: (1)
	Runners Point Group trademarks / trade names		$	23		$	24		$	23
Other intangible assets, net			$	44		$	46		$	45

(1)

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

Amortization Expense



	Thirteen weeks ended				Twenty-six weeks ended
($ in millions)		July 30, 2016		August 1, 2015	July 30, 2016		August 1, 2015
Amortization expense	$	1	$	1	$	2	$	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 2016	$	2
2017		4
2018		3
2019		3
2020		3
2021		2

Accumulated Other Comprehensive Loss (Tables)

6 Months Ended

Jul. 30, 2016

Accumulated Other Comprehensive Loss [Abstract]

Accumulated Other Comprehensive Loss

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



	July 30,		August 1,		January 30,
	2016		2015		2016
	($ in millions)
Foreign currency translation adjustments	$	(102)	$	(97)	$	(119)
Cash flow hedges		5		(4)		2
Unrecognized pension cost and postretirement benefit		(246)		(236)		(248)
Unrealized loss on available-for-sale security		—		(1)		(1)
	$	(343)	$	(338)	$	(366)

Changes in Accumulated Other Comprehensive Loss

The changes in AOCL for the twenty-six weeks ended July 30, 2016 were as follows:



	Foreign				Items Related		Unrealized
	Currency				to Pension and		Loss on
	Translation		Cash Flow		Postretirement		Available-For-
($ in millions)	Adjustments		Hedges		Benefits		Sale Security		Total
Balance as of January 30, 2016	$	(119)	$	2	$	(248)	$	(1)	$	(366)
OCI before reclassification		17		3		(2)		1		19
Reclassified from AOCI		—		—		4		—		4
Other comprehensive income/ (loss)		17		3		2		1		23
Balance as of July 30, 2016	$	(102)	$	5	$	(246)	$	—	$	(343)

Reclassification from Accumulated Other Comprehensive Loss

Reclassifications from AOCL for the twenty-six weeks ended July 30, 2016 were as follows:



		($ in millions)
Amortization of actuarial (gain) loss:
Pension benefits- amortization of actuarial loss	$	7
Postretirement benefits- amortization of actuarial gain		(1)
Net periodic benefit cost (see Note 10)		6
Income tax benefit		(2)
Net of tax	$	4

Financial Instruments (Tables)

6 Months Ended

Jul. 30, 2016

Financial Instruments [Abstract]

Fair Value of Derivative Contracts on Gross Basis, by Type of Contract

The following is presented on a gross basis, by type of contract:



	Balance Sheet	July 30,		August 1,		January 30,
($ in millions)	Caption	2016		2015		2016
Hedging Instruments:
Foreign exchange forward contracts	Current assets	$	6	$	—	$	3
Foreign exchange forward contracts	Current liabilities	$	—	$	5	$	—
Non-hedging Instruments:
Foreign exchange forward contracts	Current assets	$	—	$	1	$	—

Fair Value Measurements (Tables)

6 Months Ended

Jul. 30, 2016

Fair Value Measurements [Abstract]

Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables provide a summary of the Company’s recognized assets and liabilities that are measured at fair value on a recurring basis:



	As of July 30, 2016						As of August 1, 2015						As of January 30, 2016
	($ in millions)
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Assets
Available-for-sale securities	$	—	$	7	$	—	$	—	$	6	$	—	$	—	$	6	$	—
Foreign exchange forward contracts		—		6		—		—		2		—		—		3		—
Total Assets	$	—	$	13	$	—	$	—	$	8	$	—	$	—	$	9	$	—

Liabilities
Foreign exchange forward contracts		—		—		—		—		6		—		—		—		—
Total Liabilities	$	—	$	—	$	—	$	—	$	6	$	—	$	—	$	—	$	—

Carrying Value and Estimated Fair Value of Long-Term Debt

The carrying value and estimated fair value of long-term debt and obligations under capital leases were as follows:


	July 30,		August 1,		January 30,
	2016		2015		2016
	($ in millions)
Carrying value	$	129	$	132	$	130
Fair value	$	151	$	157	$	156

Earnings Per Share (Tables)

6 Months Ended

Jul. 30, 2016

Earnings Per Share [Abstract]

Basic and Diluted Weighted-Average Number of Common Shares Outstanding

The computation of basic and diluted earnings per share is as follows:



	Thirteen weeks ended					Twenty-six weeks ended
		July 30,		August 1,		July 30,		August 1,
		2016		2015		2016		2015
		(in millions, except per share data)
Net Income		$	127	$	119	$	318	$	303
Weighted-average common shares outstanding			134.4		139.6		135.4		139.8
Basic earnings per share		$	0.94	$	0.85	$	2.35	$	2.17
Weighted-average common shares outstanding			134.4		139.6		135.4		139.8
Dilutive effect of potential common shares			1.1		1.7		1.2		1.9
Weighted-average common shares outstanding assuming dilution			135.5		141.3		136.6		141.7
Diluted earnings per share		$	0.94	$	0.84	$	2.33	$	2.14

Retirement Plans and Other Benefits (Tables)

6 Months Ended

Jul. 30, 2016

Pension and Postretirement Plans [Abstract]

Net Benefit Expense (Income)

The following are the components of net periodic pension benefit cost and net periodic postretirement benefit income, which is recognized as part of SG&A expense:



	Pension Benefits								Postretirement Benefits
	Thirteen weeks ended				Twenty-six weeks ended				Thirteen weeks ended				Twenty-six weeks ended
	July 30,		August 1,		July 30,		August 1,		July 30,		August 1,		July 30,		August 1,
($ in millions)	2016		2015		2016		2015		2016		2015		2016		2015
Service cost	$	4	$	4	$	8	$	8	$	—	$	—	$	—	$	—
Interest cost		7		6		13		12		—		1		—		1
Expected return on plan assets		(9)		(10)		(18)		(19)		—		—		—		—
Amortization of net loss (gain)		3		4		7		7		—		(1)		(1)		(1)
Net benefit expense (income)	$	5	$	4	$	10	$	8	$	—	$	—	$	(1)	$	—

Share-Based Compensation (Tables)

6 Months Ended

Jul. 30, 2016

Share-Based Compensation [Abstract]

Total Compensation Expense and the Related Tax Benefits Recognized



	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		August 1,		July 30,		August 1,
	2016		2015		2016		2015
	($ in millions)
Options and shares purchased under the employee stock purchase plan	$	2	$	3	$	5	$	6
Restricted stock and restricted stock units		4		2		6		5
Total share-based compensation expense	$	6	$	5	$	11	$	11

Tax benefit recognized	$	2	$	1	$	3	$	3
Excess income tax benefit from settled equity-classified share-based awards reported as a cash flow from financing activities					$	10	$	24

Assumptions used to Compute Share-Based Compensation Expense



		Stock Option Plans						Stock Purchase Plan
		July 30,			August 1,			July 30,			August 1,
		2016			2015			2016			2015
Weighted-average risk free rate of interest		1.4	%		1.5	%		0.4	%		0.2	%
Expected volatility		30	%		30	%		26	%		24	%
Weighted-average expected award life (in years)		5.7			6.0			1.0			1.0
Dividend yield		1.7	%		1.6	%		1.7	%		1.7	%
Weighted-average fair value	$	15.68		$	16.01		$	15.19		$	9.53

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	3,694			$	32.62
Granted	482				63.47
Exercised	(669)				21.56
Expired or cancelled	(54)				59.03
Options outstanding at July 30, 2016	3,453		5.7	$	38.65
Options exercisable at July 30, 2016	2,420		4.3	$	29.34
Options vested and expected to vest at July 30, 2016	3,413		5.6	$	38.38
Options available for future grant at July 30, 2016	12,006

Total Intrinsic Value of Options Exercised



	Thirteen weeks ended				Twenty-six weeks ended
	July 30,		August 1,		July 30,		August 1,
	2016		2015		2016		2015
	($ in millions)
Exercised	$	12	$	29	$	26	$	65

Aggregate Intrinsic Value for Stock Options Outstanding and Exercisable



	Twenty-six weeks ended
	July 30,		August 1,
	2016		2015
	($ in millions)
Outstanding	$	76	$	173
Outstanding and exercisable	$	74	$	152
Vested and expected to vest	$	76	$	172

Information about Stock Options Outstanding and Exercisable



	Options Outstanding				Options Exercisable
		Weighted-
		Average		Weighted-			Weighted-
		Remaining		Average			Average
	Number	Contractual		Exercise	Number		Exercise
Range of Exercise Prices	Outstanding	Life		Price	Exercisable		Price
	(in thousands, except prices per share and contractual life)
$9.85 to $15.10	721	2.1	$	12.99	721	$	12.99
$18.80 to $30.92	710	3.6		23.76	710		23.76
$34.12 to $56.35	936	6.4		41.54	739		39.53
$62.02 to $73.21	1,086	8.7		62.92	250		62.15
	3,453	5.7	$	38.65	2,420	$	29.34

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		803		$	45.19
Granted		361			63.74
Vested		(212)			36.54
Expired or cancelled		(125)			39.28
Nonvested at July 30, 2016		827	1.5	$	56.39
Aggregate value ($ in millions)	$	47

Segment Information (Narrative) (Details)	6 Months Ended
Segment Information (Narrative) (Details)	Jul. 30, 2016 segment
Segment Information [Abstract]
Number of reportable segments	2

Segment Information (Sales and Division Operating Results for Reportable Segments) (Details) - USD ($)
$ in Millions

3 Months Ended

6 Months Ended

Jul. 30, 2016

Aug. 01, 2015

Jul. 30, 2016

Aug. 01, 2015

Segment Reporting Information [Line Items]

Income before income taxes

$ 1,780

$ 1,695

$ 3,767

$ 3,611

Division profit

215

203

530

510

Less: Corporate expense

Operating profit

198

186

494

476

Interest expense, net

Other income

^[1]

198

185

496

475

Athletic Stores [Member]

Segment Reporting Information [Line Items]

Operating results before restructuring income

1,576

1,503

3,311

3,184

193

176

470

443

Direct-to-Customers [Member]

Segment Reporting Information [Line Items]

Operating results before restructuring income

204

192

456

427

$ 22

$ 27

$ 60

$ 67

[1]	Other income includes non-operating items, such as lease termination gains, royalty income, insurance recoveries, and the changes in fair value, premiums paid, and realized gains associated with foreign currency option contracts.

Goodwill (Schedule of Goodwill) (Details) - USD ($)
$ in Millions

Jul. 30, 2016

Jan. 30, 2016

Aug. 01, 2015

Goodwill [Line Items]

$ 156

^[1]

$ 156

Athletic Stores [Member]

Goodwill [Line Items]

Direct-to-Customers [Member]

Goodwill [Line Items]

$ 139

[1]

Other Intangible Assets, Net (Narrative) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2016	Aug. 01, 2015	Jul. 30, 2016	Aug. 01, 2015
Goodwill and Other Intangible Assets, Net [Abstract]
Amortization expense	$ 1	$ 1	$ 2	$ 2
Additions of intangible assets of new leases			$ 1
Weighted-average amortization period			10 years

Other Intangible Assets, Net (Schedule of Other Intangible Assets) (Details) - USD ($)
$ in Millions

Jul. 30, 2016

Jan. 30, 2016

Aug. 01, 2015

^[1]

$ 147

$ 146

$ 149

^[1]

(126)

(124)

(127)

Other intangible assets, net

^[1]

^[2]

Lease Acquisition Costs [Member]

^[1]

120

119

121

^[1]

(108)

(107)

(111)

Trademarks and Trade Names [Member]

^[1]

^[1]

^[1]

(13)

(12)

Favorable Leases [Member]

^[1]

^[1]

^[1]

(5)

(4)

Runners Point Group [Member]

^[1]

Indefinite life intangible assets, Net Value

^[1]

$ 23

$ 24

[1]

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

[2]

Other Intangible Assets, Net (Amortization Expense) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 30, 2016	Aug. 01, 2015	Jul. 30, 2016	Aug. 01, 2015
Goodwill and Other Intangible Assets, Net [Abstract]
Amortization expense	$ 1	$ 1	$ 2	$ 2

Other Intangible Assets, Net (Estimated Future Amortization Expense for Finite Lived Intangibles) (Details) $ in Millions	Jul. 30, 2016 USD ($)
Goodwill and Other Intangible Assets, Net [Abstract]
Remainder of 2016	$ 2
2017	4
2018	3
2019	3
2020	3
2021	$ 2

Accumulated Other Comprehensive Loss (Schedule of Accumulated Other Comprehensive Loss) (Details) - USD ($)
$ in Millions

Jul. 30, 2016

Jan. 30, 2016

Aug. 01, 2015

Accumulated Other Comprehensive Loss [Abstract]

Foreign currency translation adjustments

$ (102)

$ (119)

$ (97)

Cash flow hedges

(4)

Unrecognized pension cost and postretirement benefit

(246)

(248)

(236)

Unrealized loss on available-for-sale security

(1)

Accumulated other comprehensive income (loss), net of tax, total

$ (343)

$ (366)

^[1]

$ (338)

[1]

Accumulated Other Comprehensive Loss (Changes in Accumulated Other Comprehensive Loss) (Details)
$ in Millions

6 Months Ended

Jul. 30, 2016

USD ($)

Accumulated Other Comprehensive Income (Loss) [Line Items]

$ (366)

^[1]

Reclassified from AOCI

Accumulated Translation Adjustment [Member]

(343)

Accumulated Other Comprehensive Income (Loss) [Line Items]

(119)

Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]

(102)

Accumulated Other Comprehensive Income (Loss) [Line Items]

Accumulated Defined Benefit Plans Adjustment [Member]

Accumulated Other Comprehensive Income (Loss) [Line Items]

(248)

(2)

Reclassified from AOCI

Accumulated Net Unrealized Investment Gain (Loss) [Member]

(246)

Accumulated Other Comprehensive Income (Loss) [Line Items]

(1)