Discontinued Operations

9 Months Ended

Nov. 02, 2013

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Abstract]

Discontinued Operations

Discontinued Operations

On June 26, 2013, we completed the sale of our 50% ownership interest in Best Buy Europe to CPW in return for the following consideration upon closing: net cash of £341 million ($526 million); £80 million ($123 million) of ordinary shares of CPW; £25 million ($39 million), plus 2.5% interest, to be paid by CPW on June 26, 2014; and £25 million ($39 million), plus 2.5% interest, to be paid by CPW on June 26, 2015. We subsequently sold the ordinary shares of CPW for $123 million on July 3, 2013.

The composition of assets and liabilities disposed of on June 26, 2013, as a result of the sale of Best Buy Europe was as follows ($ in millions):

	June 26, 2013
Cash and cash equivalents	$	597
Receivables	1,295
Merchandise inventories	554
Other current assets	168
Net property and equipment	159
Other assets	316
Total assets	3,089
Accounts payable	790
Short-term debt	973
Other current liabilities	1,145
Long-term liabilities	65
Total liabilities	2,973

Discontinued operations are comprised of: (i) Napster operations within our Domestic segment; (ii) large-format Best Buy branded store operations in China within our International segment; and (iii) Best Buy Europe operations within our International segment. The presentation of discontinued operations has been retrospectively applied to all prior periods presented.

The financial results of discontinued operations for the three and nine months ended November 2, 2013, and November 3, 2012, were as follows ($ in millions):

	Three Months Ended					Nine Months Ended
	November 2, 2013		November 3, 2012			November 2, 2013			November 3, 2012
Revenue	$	—	$	1,372		$	2,682		$	3,825
Restructuring charges(1)	—		6			100			(1		)
Gain (loss) from discontinued operations before income tax benefit (expense)	—		17			(235		)	(55		)
Income tax benefit (expense)(2)	10		(6		)	34			14
Gain on sale of discontinued operations	—		—			52			—
Equity in loss of affiliates	—		(1		)	—			(4		)
Net gain (loss) from discontinued operations, including noncontrolling interests	10		10			(149		)	(45		)
Net (gain) loss from discontinued operations attributable to noncontrolling interests	1		(11		)	11			14
Net gain (loss) from discontinued operations attributable to Best Buy Co., Inc. shareholders	$	11	$	(1	)	$	(138	)	$	(31	)

⁽¹⁾ See Note 6, Restructuring Charges, for further discussion of the restructuring charges associated with discontinued operations.

⁽²⁾ Income tax benefit for the three months ended November 2, 2013 includes a $16 million benefit related to the impairment of our investment in Best Buy Europe, partially offset by $(6) million of expense related to a tax allocation between continuing and discontinued operations. The fiscal 2014 effective tax rate for discontinued operations differs from the statutory tax rate primarily due to the tax allocation, restructuring charges and the impairment of our investment in Best Buy Europe. The restructuring charges and impairment generally included minimal related tax benefit. The deferred tax assets related to the restructuring charges generally resulted in an increase in the valuation allowance in an equal amount, while the investment impairment is generally not tax deductible.