Derivative Instruments (Notes)

6 Months Ended

Aug. 02, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative Instruments

We use foreign currency forward contracts to manage the impact of fluctuations in foreign currency exchange rates relative to recognized receivable and payable balances denominated in non-functional currencies, and on certain forecast inventory purchases denominated in non-functional currencies. The contracts generally have terms of up to 12 months. These derivative instruments are not designated in hedging relationships and, therefore, we record gains and losses on these contracts directly to net earnings. At August 2, 2014, February 1, 2014, and August 3, 2013, the notional amount of these instruments was $95 million, $157 million, and $123 million, respectively. We recognized losses of $1 million and $4 million in selling, general and administrative expenses in our Consolidated Statements of Earnings during the three and six months ended August 2, 2014, respectively, related to these instruments. For the three and six months ended August 3, 2013, we recognized gains of $5 million and $6 million, respectively, in selling, general and administrative expenses.

In conjunction with our agreement to sell our 50% ownership interest in Best Buy Europe as described in Note 2, Discontinued Operations, we entered into a deal-contingent foreign currency forward contract to hedge £455 million of the total £471 million of net proceeds. The contract was settled in cash following the completion of the sale on June 26, 2013. The effect of this instrument on our Consolidated Statements of Earnings for the three and six months ended August 3, 2013, was a $3 million gain and a $2 million loss, respectively, recognized in gain (loss) from discontinued operations.