Shareholders' Equity

12 Months Ended

Feb. 01, 2025

Shareholders' Equity [Abstract]

Shareholders' Equity

8.   Shareholders’ Equity

Stock Compensation Plans

The Best Buy Co., Inc. 2020 Omnibus Incentive Plan (the “2020 Plan”) approved by shareholders in June 2020 authorizes us to issue up to 18.6 million shares plus the remaining unused shares available for issuance under the Best Buy Co., Inc. Amended and Restated 2014 Omnibus Incentive Plan (the “2014 Plan”). In addition, shares subject to any outstanding awards under our prior stock incentive plans that are forfeited, cancelled or reacquired by the company are available for reissuance under the 2020 Plan. The 2014 Plan was terminated as to the grant of any additional awards, but prior awards remain outstanding and continue to vest in accordance with the original terms of such plan.

The 2020 Plan authorizes us to grant or issue non-qualified stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units and other equity awards. We have not granted incentive stock options. Under the terms of the 2020 Plan, awards may be granted to our employees, officers, advisers, consultants and directors. Awards issued under the 2020 Plan vest as determined by the Compensation and Human Resources Committee of our Board of Directors (“Board”) at the time of grant. Dividend equivalents accrue on restricted stock and restricted stock units during the vesting period, are forfeitable prior to the vesting date and are settled in shares of our common stock at the vesting or distribution date. As of February 1, 2025, a total of 9.5 million shares were available for future grants under the 2020 Plan.

Stock-based compensation expense was as follows ($ in millions):

	2025		2024		2023
Share awards:
Time-based	$	122	$	126	$	121
Market-based		17		19		14
Stock options		-		-		3
Stock-based compensation expense		139		145		138
Income tax benefits		25		27		27
Stock-based compensation expense, net of tax	$	114	$	118	$	111

Time-Based Share Awards

Time-based share awards vest solely upon continued employment, generally 33% on each of the three annual anniversary dates following the grant date. Time-based share awards to directors vest one year from the date of grant. Information on our time-based share awards was as follows (shares in thousands):

Time-Based Share Awards	Shares	Weighted-Average Fair Value per Share
Outstanding as of February 3, 2024	3,266	$	85.71
Granted	1,987	$	79.01
Vested and distributed	(1,419)	$	93.01
Forfeited	(356)	$	82.14
Outstanding as of February 1, 2025	3,478	$	79.43

Information regarding the vesting and distribution of time-based share awards was as follows ($ in millions):

Time-Based Share Awards	2025		2024		2023
Fair value of awards vested and distributed	$	113	$	114	$	159
Tax benefits realized for tax deductions related to vesting	$	23	$	24	$	33

As of February 1, 2025, there was $133 million of unrecognized compensation expense related to non-vested time-based share awards that we expect to recognize over a weighted-average period of 1.8 years. 

Market-Based Share Awards

Market-based share awards vest at the end of a three-year incentive period based upon our total shareholder return ("TSR") compared to the TSR of companies that comprise Standard & Poor's 500 Index. The number of shares of common stock that could be distributed at the end of the three-year TSR-incentive period may range from 0% to 150% of each share granted (“target”). Shares are granted at 100% of target. Information on our market-based share awards was as follows (shares in thousands):

Market-Based Share Awards	Shares	Weighted-Average Fair Value per Share
Outstanding as of February 3, 2024	579	$	106.38
Granted	285	$	84.25
Adjustment for performance achievement	(131)	$	132.21
Forfeited	(41)	$	103.66
Outstanding as of February 1, 2025	692	$	92.95

Distributions of market-based share awards in fiscal 2025 and fiscal 2024 were not significant. Information regarding the vesting and distribution of market-based share awards in fiscal 2023 was as follows ($ in millions):

Market-Based Share Awards		2023
Fair value of awards vested and distributed	$	18
Tax benefits realized for tax deductions related to vesting	$	2

As of February 1, 2025, there was $21 million of unrecognized compensation expense related to non-vested market-based share awards that we expect to recognize over a weighted-average period of 1.7 years.

Earnings per Share

Reconciliations of the numerators and denominators of basic and diluted earnings per share were as follows ($ and shares in millions, except per share amounts):

	2025		2024		2023
Numerator
Net earnings	$	927	$	1,241	$	1,419
Denominator
Weighted-average common shares outstanding		215.2		217.7		224.8
Dilutive effect of stock compensation plan awards		1.4		0.8		0.9
Weighted-average common shares outstanding, assuming dilution		216.6		218.5		225.7
Potential shares which were anti-dilutive and excluded from weighted-average share computations		-		-		0.7
Basic earnings per share	$	4.31	$	5.70	$	6.31
Diluted earnings per share	$	4.28	$	5.68	$	6.29

Repurchase of Common Stock

On February 28, 2022, our Board approved a $5.0 billion share repurchase program. The program had $3.3 billion remaining available for repurchases as of February 1, 2025. There is no expiration date governing the period over which we can repurchase shares under this authorization.

Information regarding the shares we repurchased and retired was as follows ($ and shares in millions, except per share amounts):

	2025		2024		2023
Total cost of shares repurchased	$	500	$	340	$	1,001
Average price per share	$	86.42	$	72.52	$	84.78
Number of shares repurchased and retired		5.8		4.7		11.8