BEST BUY CO INCBBY

BEST BUY CO INC Leases Disclosure

10-KFiled Mar 18, 20262 min read
Leases
Supplemental balance sheet information related to our leases was as follows ($ in millions):
Balance Sheet LocationJanuary 31, 2026February 1, 2025
Assets
Operating leasesOperating lease assets$2,869 $2,833 
Finance leases
Property under finance leases, net(1)
42 34 
Total lease assets$2,911 $2,867 
Liabilities
Current:
Operating leasesCurrent portion of operating lease liabilities$623 $617 
Finance leasesCurrent portion of long-term debt11 10 
Non-current:
Operating leasesLong-term operating lease liabilities2,334 2,282 
Finance leasesLong-term debt21 15 
Total lease liabilities$2,989 $2,924 
(1)Finance leases were recorded net of accumulated depreciation of $38 million and $54 million as of January 31, 2026, and February 1, 2025, respectively.

Costs and cash flow impacts associated with our finance leases were immaterial in the periods presented. Components of our total operating lease cost were as follows ($ in millions):
Statement of Earnings Location202620252024
Operating lease cost(1)
Cost of sales and SG&A(2)
$790 $784 $777 
Variable lease cost
Cost of sales and SG&A(2)
241 236 239 
Sublease incomeSG&A(14)(13)(11)
Total operating lease cost$1,017 $1,007 $1,005 
(1)Includes short-term leases, which are immaterial.
(2)Supply chain-related amounts are included in Cost of sales.
Other information related to our operating leases was as follows ($ in millions):
20262025
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows$794 $781 
Lease assets obtained in exchange for new lease liabilities$680 $771 
Weighted average remaining lease term (in years)5.45.4
Weighted average discount rate4.4 %4.1 %

Future lease payments under our non-cancellable operating leases as of January 31, 2026, were as follows ($ in millions):
Operating Leases(1)
Fiscal 2027$739 
Fiscal 2028719 
Fiscal 2029578 
Fiscal 2030457 
Fiscal 2031312 
Thereafter542 
Total future undiscounted lease payments3,347 
Less imputed interest390 
Total reported lease liability$2,957 
(1)Lease payments exclude $22 million of legally binding fixed costs for leases signed but not yet commenced.
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Historical Timeline

Fiscal YearFiled
2026Mar 18, 2026Showing above
2024Mar 15, 2024
2023Mar 17, 2023
2022Mar 18, 2022
2021Mar 19, 2021
2020Mar 23, 2020
2019Mar 28, 2019
2018Apr 2, 2018
2017Mar 24, 2017
2016Mar 23, 2016

About Leases Disclosures

Lease disclosures under ASC 842 provide a comprehensive view of a company's leased asset portfolio, including the split between operating and finance leases, discount rates used to present-value future payments, and the maturity schedule of lease obligations. This section reveals a significant source of off-balance-sheet commitments that were largely hidden before the current standard.

Key signals: the weighted-average discount rate affects the size of recorded lease liabilities — a higher rate reduces the reported obligation, so compare the chosen rate against the company's incremental borrowing rate. The operating versus finance lease mix affects both EBITDA and operating income presentation. Watch the maturity table for concentration risk: large payment cliffs in specific years may create cash flow pressure. Variable lease payments excluded from the liability measurement represent real obligations that do not appear on the balance sheet. Compare total lease costs against prior-year operating lease expense to assess the true economic burden.

Other Available Disclosures

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