WAL MART STORES INC, 10-Q filed on 9/1/2010
Quarterly Report
Document and Entity Information
6 Months Ended
Jul. 31, 2010
Aug. 27, 2010
Document Type
10-Q 
 
Amendment Flag
FALSE 
 
Document Period End Date
2010-07-31 
 
Document Fiscal Year Focus
2011 
 
Document Fiscal Period Focus
Q2 
 
Entity Registrant Name
WAL MART STORES INC 
 
Entity Central Index Key
0000104169 
 
Current Fiscal Year End Date
01/31 
 
Entity Filer Category
Large Accelerated Filer 
 
Entity Common Stock, Shares Outstanding
 
3,636,547,192 
Condensed Consolidated Statements of Income (USD $)
In Millions, except Per Share data
3 Months Ended
Jul. 31,
6 Months Ended
Jul. 31,
2010
2009
2010
2009
Revenues:
 
 
 
 
Net sales
$ 103,016 
$ 100,168 
$ 202,113 
$ 193,639 
Membership and other income
710 
708 
1,424 
1,451 
Revenues, total
103,726 
100,876 
203,537 
195,090 
Costs and expenses:
 
 
 
 
Cost of sales
77,523 
75,056 1
152,223 
145,451 1
Operating, selling, general and administrative expenses
20,013 
19,891 
39,387 
38,537 
Operating income
6,190 
5,929 
11,927 
11,102 
Interest:
 
 
 
 
Debt
477 
447 
932 
895 
Capital leases
65 
68 
132 
138 
Interest income
(57)
(42)
(108)
(93)
Interest, net
485 
473 
956 
940 
Income from continuing operations before income taxes
5,705 
5,456 
10,971 
10,162 
Provision for income taxes
1,958 
1,870 
3,780 
3,455 
Income from continuing operations
3,747 
3,586 
7,191 
6,707 
Loss from discontinued operations, net of tax
 
(7)
 
(15)
Consolidated net income
3,747 2
3,579 2
7,191 3
6,692 3
Less consolidated net income attributable to noncontrolling interest
151 
107 
294 
224 
Consolidated net income attributable to Walmart
3,596 
3,472 
6,897 
6,468 
Basic net income per common share:
 
 
 
 
Basic income per common share from continuing operations attributable to Walmart
0.97 
0.89 
1.85 
1.66 
Basic loss per common share from discontinued operations attributable to Walmart
 
 
 
 
Basic net income per common share attributable to Walmart
0.97 
0.89 
1.85 
1.66 
Diluted net income per common share:
 
 
 
 
Diluted income per common share from continuing operations attributable to Walmart
0.97 
0.89 
1.84 
1.66 
Diluted loss per common share from discontinued operations attributable to Walmart
 
 
 
(0.01)
Diluted net income per common share attributable to Walmart
$ 0.97 
$ 0.89 
$ 1.84 
$ 1.65 
Weighted-average number of common shares:
 
 
 
 
Basic
3,696 
3,891 
3,730 
3,905 
Diluted
3,707 
3,900 
3,744 
3,915 
Dividends declared per common share
 
 
1.21 
1.09 
Condensed Consolidated Balance Sheets(USD ($))
In Millions
6 Months Ended
Jul. 31, 2009
Year Ended
Jan. 31, 2010
Jul. 31, 2010
Current assets:
 
 
 
Cash and cash equivalents
$ 7,997 
$ 7,907 
$ 10,195 
Receivables, net
3,684 
4,144 
4,531 
Inventories
33,365 
32,713 
34,793 
Prepaid expenses and other
3,499 
3,128 
3,395 
Current assets of discontinued operations
147 
140 
131 
Total current assets
48,692 
48,032 
53,045 
Property and equipment:
 
 
 
Property and equipment
133,070 
137,848 
142,123 
Less accumulated depreciation
(35,707)
(38,304)
(41,012)
Property and equipment, net
97,363 
99,544 
101,111 
Property under capital leases:
 
 
 
Property under capital leases
5,583 
5,669 
5,720 
Less accumulated amortization
(2,759)
(2,906)
(3,017)
Property under capital leases, net
2,824 
2,763 
2,703 
Goodwill
16,149 
16,126 
15,993 
Other assets and deferred charges
3,581 
3,942 
4,092 
Total assets
168,609 
170,407 
176,944 
Current liabilities:
 
 
 
Short-term borrowings
1,122 
523 
4,639 
Accounts payable
28,797 
30,451 
33,953 
Dividends payable
2,073 
 
2,292 
Accrued liabilities
16,706 
18,734 
17,547 
Accrued income taxes
1,142 
1,347 
1,257 
Long-term debt due within one year
6,959 
4,050 
5,546 
Obligations under capital leases due within one year
336 
346 
346 
Current liabilities of discontinued operations
41 
92 
75 
Total current liabilities
57,176 
55,543 
65,655 
Long-term debt
33,579 
33,231 
35,629 
Long-term obligations under capital leases
3,246 
3,170 
3,073 
Deferred income taxes and other
5,773 
5,508 
5,368 
Redeemable noncontrolling interest
326 
307 
323 
Commitments and contingencies
 
 
 
Equity:
 
 
 
Common stock and capital in excess of par value
4,173 
4,181 
3,999 
Retained earnings
62,840 
66,357 
61,746 
Accumulated other comprehensive loss
(318)
(70)
(1,099)
Total Walmart shareholders' equity
66,695 
70,468 
64,646 
Noncontrolling interest
1,814 
2,180 
2,250 
Total equity
68,509 
72,648 
66,896 
Total liabilities and equity
$ 168,609 
$ 170,407 
$ 176,944 
Condensed Consolidated Statements of Shareholders' Equity (USD $)
In Millions
Common Stock
Capital in Excess of Par Value
Retained Earnings
Accumulated Other Comprehensive Loss
Total Walmart Shareholders' Equity
Noncontrolling Interest
Total
Beginning Balances (in shares) at Jan. 31, 2010
3,786 
 
 
 
 
 
 
Beginning Balances at Jan. 31, 2010
$ 378 
$ 3,803 
$ 66,357 
$ (70)
$ 70,468 
$ 2,180 
$ 72,648 
Consolidated net income (excludes redeemable noncontrolling interest)
 
 
6,897 
 
6,897 
292 
7,189 
Other comprehensive income (loss)
 
 
 
(1,029)
(1,029)
31 
(998)
Cash dividends ($1.21 per share)
 
 
(4,552)
 
(4,552)
 
(4,552)
Purchase of Company stock (in shares)
(137)
 
 
 
 
 
 
Purchase of Company stock
(14)
(242)
(6,920)
 
(7,176)
 
(7,176)
Other (in shares)
 
 
 
 
 
Other
 
74 
(36)
 
38 
(253)
(215)
Ending Balances (in shares) at Jul. 31, 2010
3,655 
 
 
 
 
 
 
Ending Balances at Jul. 31, 2010
$ 364 
$ 3,635 
$ 61,746 
$ (1,099)
$ 64,646 
$ 2,250 
$ 66,896 
Condensed Consolidated Statements of Shareholders' Equity (Parenthetical)
3 Months Ended
Jul. 31,
6 Months Ended
Jul. 31,
2010
2009
2010
2009
Cash dividends, per share
 
 
1.21 
1.09 
Condensed Consolidated Statements of Comprehensive Income (USD $)
In Millions
3 Months Ended
Jul. 31,
6 Months Ended
Jul. 31,
2010
2009
2010
2009
Consolidated net income
$ 3,747 1
$ 3,579 1
$ 7,191 2
$ 6,692 2
Other comprehensive income, net of tax
 
 
 
 
Currency translation
(896)3
3,283 3
(944)4
2,596 4
Net change in fair value of derivatives
(108)
(98)
(25)
(112)
Total comprehensive income
2,743 
6,764 
6,222 
9,176 
Less comprehensive income attributable to the noncontrolling interest
 
 
 
 
Net income
(151)1
(107)1
(294)2
(224)2
Currency translation
121 3
(125)3
(60)4
(109)4
Amounts attributable to the noncontrolling interest
(30)
(232)
(354)
(333)
Comprehensive income attributable to Walmart
$ 2,713 
$ 6,532 
$ 5,868 
$ 8,843 
Condensed Consolidated Statements of Comprehensive Income (Parenthetical) (USD $)
In Millions
3 Months Ended
Jul. 31,
6 Months Ended
Jul. 31,
2010
2009
2010
2009
Consolidated net income, redeemable noncontrolling interest
$ 5 
$ 0 
$ 2 
$ 8 
Foreign currency translation, redeemable noncontrolling interest
$ 3 
$ 49 
$ 29 
$ 74 
Condensed Consolidated Statements of Cash Flows (USD $)
In Millions
6 Months Ended
Jul. 31,
2010
2009
Cash flows from operating activities:
 
 
Consolidated net income
$ 7,191 1
$ 6,692 1
Loss from discontinued operations, net of tax
 
15 
Income from continuing operations
7,191 
6,707 
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
 
 
Depreciation and amortization
3,748 
3,457 
Other
(162)
(244)
Changes in certain assets and liabilities, net of effects of acquisitions:
 
 
Decrease (increase) in accounts receivable
(424)
575 
Decrease (increase) in inventories
(2,086)
1,392 
Increase (decrease) in accounts payable
3,090 
(1,131)
Decrease in accrued liabilities
(1,338)
(861)
Net cash provided by operating activities
10,019 
9,895 
Cash flows from investing activities:
 
 
Payments for property and equipment
(5,554)
(5,744)
Other investing activities
(27)
(4)
Net cash used in investing activities
(5,581)
(5,748)
Cash flows from financing activities:
 
 
Increase (decrease) in short-term borrowings, net
4,120 
(654)
Proceeds from issuance of long-term debt
6,433 
2,956 
Payment of long-term debt
(2,639)
(95)
Dividends paid
(2,260)
(2,129)
Purchase of Company stock
(7,112)
(2,792)
Purchase of redeemable noncontrolling interest
 
(456)
Other financing activities
(587)
(264)
Net cash provided by (used in) financing activities
(2,045)
(3,434)
Effect of exchange rates on cash and cash equivalents
(105)
Net increase (decrease) in cash and cash equivalents
2,288 
722 
Cash and cash equivalents at beginning of year
7,907 
7,275 
Cash and cash equivalents at end of period
$ 10,195 
$ 7,997 
Basis of Presentation
Basis of Presentation

Note 1. Basis of Presentation

The Condensed Consolidated Financial Statements of Wal-Mart Stores, Inc. and its subsidiaries ("Walmart," the "Company" or "we") included in this document are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the Condensed Consolidated Financial Statements have been included. Such adjustments are of a normal recurring nature. Interim results are not necessarily indicative of results for a full year. The Condensed Consolidated Financial Statements and notes thereto are presented in accordance with the rules and regulations of the Securities and Exchange Commission (the "SEC") and do not contain certain information included in the Company's Annual Report to Shareholders for the fiscal year ended January 31, 2010. Therefore, the interim Condensed Consolidated Financial Statements should be read in conjunction with that Annual Report to Shareholders.

In connection with the Company's enterprise resource planning ("ERP") system implementation, we changed the level at which we apply the retail method of accounting for inventory, and reclassified certain revenue and expense items within our Condensed Consolidated Statements of Income for financial reporting purposes. The reclassifications did not impact consolidated operating income or consolidated net income attributable to Walmart. All prior period amounts have been reclassified to conform to the current period's presentation. See Note 4, Accounting Change.

Recent Accounting Pronouncements

A new accounting standard, effective for and adopted by the Company on February 1, 2010, changes the approach to determining the primary beneficiary of a variable interest entity ("VIE") and requires companies to assess more frequently whether they must consolidate VIEs. The adoption of this new standard did not have a material impact on our consolidated financial statements.

Net Income Per Common Share
Net Income Per Common Share

Note 2. Net Income Per Common Share

Basic net income per common share attributable to Walmart is based on the weighted-average number of outstanding common shares. Diluted net income per common share attributable to Walmart is based on the weighted-average number of outstanding common shares adjusted for the dilutive effect of stock options and other share-based awards. The dilutive effect of outstanding stock options and other share-based awards was 11 million and 14 million shares for the three and six months ended July 31, 2010, respectively, and 9 million and 10 million shares for the three and six months ended July 31, 2009, respectively. The Company had approximately 19 million and 29 million stock options outstanding at July 31, 2010 and 2009, respectively, which were not included in the diluted net income per common share attributable to Walmart calculation because their effect would be antidilutive.

The following table provides a reconciliation of the numerators used to determine basic and diluted net income per common share:

 

     Three Months Ended
July 31,
    Six Months Ended
July 31,
 
(Amounts in millions)    2010     2009
As Adjusted
    2010     2009
As Adjusted
 

Income from continuing operations

   $ 3,747      $ 3,586      $ 7,191      $ 6,707   

Less consolidated net income attributable to noncontrolling interest

     (151     (107     (294     (224
                                

Income from continuing operations attributable to Walmart

     3,596        3,479        6,897        6,483   

Loss from discontinued operations, net of tax

     —          (7     —          (15
                                

Consolidated net income attributable to Walmart

   $ 3,596      $ 3,472      $ 6,897      $ 6,468   
                                
Inventories
Inventories

Note 3. Inventories

The Company values inventories at the lower of cost or market as determined primarily by the retail method of accounting, using the last-in, first-out ("LIFO") method for substantially all of the Walmart U.S. segment's merchandise inventories. The retail method of accounting results in inventory being valued at the lower of cost or market since permanent markdowns are currently taken as a reduction of the retail value of inventory. The Sam's Club segment's merchandise is valued based on the weighted-average cost using the LIFO method. Inventories for the Walmart International operations are primarily valued by the retail method of accounting and are stated using the first-in, first-out ("FIFO") method. At July 31, 2010 and 2009, our inventories valued at LIFO approximate those inventories as if they were valued at FIFO.

As discussed in Note 4, effective May 1, 2010 the Company changed the level at which it applies the retail method for valuing its inventory for its operations in the United States, Canada and Puerto Rico. The retrospective application of this accounting change impacted both segment and consolidated operating income, as well as consolidated net income for all comparable periods presented.

Accounting Change
Accounting Change

Note 4. Accounting Change

Effective May 1, 2010, the Company implemented a new ERP system for its operations in the United States, Canada and Puerto Rico. Concurrent with this implementation and the increased system capabilities, the Company changed the level at which it applies the retail method of accounting for inventory in these operations from 13 divisions to 49 departments. The Company believes the change is preferable because applying the retail method of accounting for inventory at the departmental level better segregates merchandise with similar cost-to-retail ratios and turnover, as well as provides a more accurate cost of goods sold and ending inventory value at the lower of cost or market for each reporting period. The retrospective application of this accounting change impacted both segment and consolidated operating income, as well as consolidated net income for all comparable periods presented.

The retrospective application of the accounting change impacted the following financial statement line items:

 

(Amounts in millions except per share data)    Three Months Ended July 31, 2009    Six Months Ended July 31, 2009
     As Reported    Adjustments     As Adjusted    As Reported    Adjustments     As Adjusted

Condensed Consolidated Statements of Income:

               

Cost of sales (1)

   $ 75,153    $ (97   $ 75,056    $ 145,541    $ (90   $ 145,451

Operating income

     5,882      47        5,929      11,099      3        11,102

Provision for income taxes

     1,853      17        1,870      3,456      (1     3,455

Income from continuing operations

     3,556      30        3,586      6,703      4        6,707

Consolidated net income attributable to Walmart

     3,442      30        3,472      6,464      4        6,468

Basic net income per share attributable to Walmart

     0.88      0.01        0.89      1.66      —          1.66

Diluted net income per share attributable to Walmart

     0.88      0.01        0.89      1.65      —          1.65

 

(1)

 

     July 31, 2009    January 31, 2010
(Amounts in millions)    As Reported    Adjustments     As Adjusted    As Reported    Adjustments     As Adjusted

Condensed Consolidated Balance Sheets:

               

Inventories

   $ 33,861    $ (496   $ 33,365    $ 33,160    $ (447   $ 32,713

Prepaid expenses and other

     3,336      163        3,499      2,980      148        3,128

Accrued income taxes

     1,162      (20     1,142      1,365      (18     1,347

Retained earnings

     63,153      (313     62,840      66,638      (281     66,357
Debt
Debt

Note 5. Debt

On April 1, 2010, the Company issued $750 million principal amount of its 2.875% Notes due 2015 and $1.250 billion principal amount of its 5.625% Notes due 2040. The aggregate net proceeds from these note issuances were approximately $2.0 billion. The notes of each series require semi-annual interest payments on April 1 and October 1 of each year, commencing on October 1, 2010. The 2.875% Notes due 2015 will mature on April 1, 2015, and the 5.625% Notes due 2040 will mature on April 1, 2040. The entire principal amount of the notes of each series is payable at maturity. The notes of each series are senior, unsecured obligations of the Company.

On July 8, 2010, the Company issued $750 million principal amount of its 2.250% Notes due 2015, $1.500 billion principal amount of its 3.625% Notes due 2020, and $750 million principal amount of its 4.875% Notes due 2040. The aggregate net proceeds from these note issuances were approximately $3.0 billion. The notes of each series require semi-annual interest payments on January 8 and July 8 of each year, commencing on January 8, 2011. The 2.250% Notes due 2015 will mature on July 8, 2015; the 3.625% Notes due 2020 will mature on July 8, 2020; and the 4.875% Notes due 2040 will mature on July 8, 2040. The entire principal amount of the notes of each series is payable at maturity. The notes of each series are senior, unsecured obligations of the Company.

On July 28, 2010, the Company issued and sold ¥60 billion of its Japanese Yen Bonds - Fourth Series (2010) (the "Fixed Rate Fourth Series Bonds"), ¥10 billion of its Japanese Yen Bonds – Fifth Series (2010) (the "Fixed Rate Fifth Series Bonds") and ¥30 billion of its Japanese Yen Floating Rate Bonds - Third Series (2010) (the "Floating Rate Bonds") at an issue price, in the case of each issue of bonds, equal to the face amount of the bonds and used the proceeds to repay a portion of its outstanding borrowing under its Yen-denominated credit facility. The aggregate net proceeds of the bonds were approximately $1.0 billion. The Fixed Rate Fourth Series Bonds bear interest at a rate of 0.94% per annum, and the Fixed Rate Fifth Series Bonds bear interest at a rate of 1.60%. The Floating Rate Bonds bear interest at a floating rate of interest equal to an applicable three-month Yen LIBOR for each interest period plus 0.45%. Interest started accruing on the bonds on the Fixed Rate Fourth Series Bonds and the Fixed Rate Fifth Series Bonds on July 29. 2010 and on the Floating Rate Bonds on July 28, 2010. The Company will pay interest on the Fixed Rate Fourth Series Bonds and the Fixed Rate Fifth Series Bonds on January 28 and July 28 of each year, commencing on January 28, 2011. The Company will pay interest on the Floating Rate Bonds on January 28, April 28, July 28, and October 28 of each year, commencing on October 28, 2010. The Fixed Rate Fourth Series Bonds and the Floating Rate Bonds will mature on July 28, 2015, and the Fixed Rate Fifth Series Bonds will mature on July 28, 2020. The entire principal amount of the bonds of each series is payable at maturity. The bonds of each series are senior, unsecured obligations of Walmart.

In June 2010, the Company renewed an existing 364-day revolving credit facility which is used to complement its commercial paper program (the "364-Day Facility"). The size of the 364-Day Facility was increased from $7.0 billion to $9.0 billion. In conjunction with the 364-Day Facility, the Company also renewed an existing letter of credit facility used to support various potential and actual obligations. The size of the new letter of credit facility was reduced from $2.35 billion to $2.23 billion to reflect program improvements. In both facilities, undrawn and drawn fees were reduced from the prior year. The 364-Day Facility remained undrawn as of July 31, 2010.

Fair Value Measurements
Fair Value Measurements

Note 6. Fair Value Measurements

The Company records and discloses certain financial and non-financial assets and liabilities at their fair value. The fair value of an asset is the price at which the asset could be sold in an orderly transaction between unrelated, knowledgeable and willing parties able to engage in the transaction. A liability's fair value is defined as the amount that would be paid to transfer the liability to a new obligor in a transaction between such parties, not the amount that would be paid to settle the liability with the creditor.

Assets and liabilities recorded at fair value are measured using a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include:

 

   

Level 1, defined as observable inputs such as quoted prices in active markets;

 

   

Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and

 

   

Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring the Company to develop our own assumptions.

The disclosure of fair value of certain financial assets and liabilities that are recorded at cost are as follows:

Cash and cash equivalents: The carrying value approximates fair value due to the short maturity of these instruments.

Long-term debt: The fair value is based on the Company's current incremental borrowing rate for similar types of borrowing arrangements or, where applicable, quoted market prices. The carrying value and fair value of our debt as of July 31, 2010 and January 31, 2010 are as follows:

 

     July 31, 2010    January 31, 2010
(Amounts in millions)    Carrying Value    Fair Value    Carrying Value    Fair Value

Long-term debt

   $ 41,175    $ 44,407     $ 37,281    $ 39,055

Additionally, as of July 31, 2010 and January 31, 2010, the Company held certain derivative asset and liability positions that are required to be measured at fair value on a recurring basis. The majority of the Company's derivative instruments relate to interest rate swaps. The fair values of these interest rate swaps have been measured in accordance with Level 2 inputs of the fair value hierarchy. As of July 31, 2010 and January 31, 2010, the notional amounts and fair values of these interest rate swaps are as follows (asset/(liability)):

 

     July 31, 2010     January 31, 2010  
(Amounts in millions)    Notional
Amount
   Fair
Value
    Notional
Amount
   Fair
Value
 

Receive fixed-rate, pay floating-rate interest rate swaps designated as fair value hedges

   $ 4,445    $ 316      $ 4,445    $ 260   

Receive fixed-rate, pay fixed-rate cross-currency interest rate swaps designated as net investment hedges

     1,250      312        1,250      189   

Receive floating-rate, pay fixed-rate interest rate swaps designated as cash flow hedges

     638      (20     638      (20

Receive fixed-rate, pay fixed-rate cross-currency interest rate swaps designated as cash flow hedges

     2,902      74        2,902      286   
                              

Total

   $ 9,235    $ 682      $ 9,235    $ 715   
                              

The fair values above are determined based on the income approach and the related inputs of the relevant interest rate and foreign currency forward curves. The estimated amounts the Company would receive or pay upon a termination of the agreements relating to such instruments approximate the fair values as of the reporting dates.

Derivative Financial Instruments
Derivative Financial Instruments

Note 7. Derivative Financial Instruments

The Company uses derivative financial instruments for hedging and non-trading purposes to manage its exposure to changes in interest and currency exchange rates, as well as to maintain an appropriate mix of fixed- and floating-rate debt. Use of derivative financial instruments in hedging programs subjects the Company to certain risks, such as market and credit risks. Market risk represents the possibility that the value of the derivative instrument will change. In a hedging relationship, the change in the value of the derivative is offset to a great extent by the change in the value of the underlying hedged item. Credit risk related to derivatives represents the possibility that the counterparty will not fulfill the terms of the contract. The notional, or contractual, amount of the Company's derivative financial instruments is used to measure interest to be paid or received and does not represent the Company's exposure due to credit risk. Credit risk is monitored through established approval procedures, including setting concentration limits by counterparty, reviewing credit ratings and requiring collateral (generally cash) from the counterparty if the derivative liability position exceeds certain thresholds.

The Company's transactions are with counterparties rated "A+" or better by nationally recognized credit rating agencies. In connection with various derivative agreements with counterparties, the Company held $327 million in cash collateral from these counterparties at July 31, 2010. It is our policy to record cash collateral exclusive of any derivative asset, and any collateral holdings are reflected in our accrued liabilities as amounts due to the counterparties. Furthermore, as part of the master netting arrangements with these counterparties, the Company is also required to post collateral if the derivative liability position exceeds $150 million. As of July 31, 2010, the Company had no outstanding collateral postings. In the event the Company posts cash collateral, the Company would record the posting as a receivable exclusive of any derivative liability.

When the Company uses derivative financial instruments for purposes of hedging its exposure to interest and currency exchange rate risks, the contract terms of a hedge instrument closely mirror those of the hedged item, providing a high degree of risk reduction and correlation. Contracts that are effective at meeting the risk reduction and correlation criteria are recorded using hedge accounting. If a derivative instrument is a hedge, depending on the nature of the hedge, changes in the fair value of the instrument will either be offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings or be recognized in accumulated other comprehensive loss until the hedged item is recognized in earnings. The ineffective portion of an instrument's change in fair value will be immediately recognized in the Company's earnings during the period. Instruments that do not meet the criteria for hedge accounting, or contracts for which the Company has not elected hedge accounting, are valued at fair value with unrealized gains or losses reported in earnings during the period of the change.

Fair Value Instruments

The Company is party to receive fixed-rate, pay floating-rate interest rate swaps to hedge the fair value of fixed-rate debt. Under certain swap agreements, the Company pays floating-rate interest and receives fixed-rate interest payments periodically over the life of the instruments. The notional amounts are used to measure interest to be paid or received and do not represent the exposure due to credit loss. The Company's interest rate swaps that receive fixed-interest rate payments and pay floating-interest rate payments are designated as fair value hedges. As the specific terms and notional amounts of the derivative instruments match those of the instruments being hedged, the derivative instruments were assumed to be perfectly effective hedges, and all changes in fair value of the hedges were recorded on the balance sheet with no net impact on the income statement. These fair value instruments will mature on dates ranging from February 2011 to May 2014.

 

Net Investment Instruments

The Company is party to cross-currency interest rate swaps that hedge its net investment in the United Kingdom. The agreements are contracts to exchange fixed-rate payments in one currency for fixed-rate payments in another currency. All changes in the fair value of these instruments are recorded in accumulated other comprehensive loss, offsetting the currency translation adjustment that is also recorded in accumulated other comprehensive loss. These instruments will mature on dates ranging from October 2023 to February 2030.

The Company has £3.0 billion of outstanding debt that is designated as a hedge of the Company's net investment in the United Kingdom as of July 31, 2010 and January 31, 2010. The Company also has outstanding ¥437 billion of debt that is designated as a hedge of the Company's net investment in Japan at July 31, 2010 and January 31, 2010, respectively. Any translation of non-U.S. denominated debt is recorded in accumulated other comprehensive loss, offsetting the currency translation adjustment that is also recorded in accumulated other comprehensive loss. These instruments will mature on dates ranging from January 2011 to January 2039.

Cash Flow Instruments

The Company is party to receive floating-rate, pay fixed-rate interest rate swaps to hedge the interest rate risk of certain non-U.S. denominated debt. The swaps are designated as cash flow hedges of interest expense risk. Changes in the non-U.S. benchmark interest rate result in reclassification of amounts from accumulated other comprehensive loss to earnings to offset the floating-rate interest expense. These cash flow instruments will mature on dates ranging from August 2013 to July 2015.

The Company is also party to receive fixed-rate, pay fixed-rate cross-currency interest rate swaps to hedge the currency exposure associated with the forecasted payments of principal and interest of non-U.S. denominated debt. The swaps are designated as cash flow hedges of the currency risk related to payments on the non-U.S. denominated debt. Changes in the currency exchange rate result in reclassification of amounts from accumulated other comprehensive loss to earnings to offset the re-measurement gain or loss on the non-U.S. denominated debt. These cash flow instruments will mature on dates ranging from September 2029 to March 2034. Any ineffectiveness related to these instruments has been and is expected to be immaterial.

Financial Statement Presentation

Hedging instruments with an unrealized gain are recorded on the Condensed Consolidated Balance Sheets in other assets and deferred charges, based on maturity date. Those instruments with an unrealized loss are recorded in accrued liabilities or deferred income taxes and other, based on maturity date.

As of July 31, 2010 and January 31, 2010, our financial instruments were classified as follows in the Condensed Consolidated Balance Sheets:

 

     July 31, 2010    January 31, 2010
(Amounts in millions)    Fair Value
Instruments
   Net
Investment

Hedge
   Cash Flow
Instruments
   Fair Value
Instruments
   Net
Investment
Hedge
   Cash Flow
Instruments

Balance Sheet Classification:

                 

Other assets and deferred charges

   $ 316    $ 312    $ 74    $ 260    $ 189    $ 286
                                         

Asset Subtotals

   $ 316    $ 312    $ 74    $ 260    $ 189    $ 286
                                         

Long-term debt

   $ 316    $ —      $ —      $ 260    $ —      $ —  

Deferred income taxes and other

     —        —        20      —        —        20
                                         

Liability Subtotals

   $ 316    $ —      $ 20    $ 260    $ —      $ 20
Segments
Segments

Note 8. Segments

The Company is engaged in the operations of retail stores located in all 50 states of the United States and Puerto Rico, our wholly-owned subsidiaries in Argentina, Brazil, Canada, Japan and the United Kingdom, our majority-owned subsidiaries in Chile and Mexico and our joint ventures in China and India and our other controlled subsidiaries in China. Our operations are conducted in three operating segments, the Walmart U.S. segment, the Walmart International segment and the Sam's Club segment. The Company defines our segments as those business units whose operating results our chief operating decision maker ("CODM") regularly reviews to analyze performance and allocate resources. We sell similar individual products and services in each of our segments. It is impractical to segregate and identify revenue and profits for each of these individual products and services.

As part of an operational realignment in February 2010, our Puerto Rico operations shifted from the Walmart International segment to the Walmart U.S. and Sam's Club segments. The Walmart U.S. segment now includes the Company's mass merchant concept in the United States and Puerto Rico operating primarily under the "Walmart" or "Wal-Mart" brands, as well as walmart.com. The Walmart International segment now consists of the Company's operations outside of the United States and Puerto Rico. The Sam's Club segment now includes the warehouse membership clubs in the United States and Puerto Rico, as well as samsclub.com. All prior period amounts have been reclassified to conform to the current period's presentation. The amounts under the caption "Other" in the Operating Income table below represent unallocated corporate overhead items.

The Company measures the results of its segments using, among other measures, each segment's operating income that includes certain corporate overhead allocations. From time to time, we revise the measurement of each segment's operating income, including any corporate overhead allocations, as dictated by the information regularly reviewed by our CODM. In the first quarter of fiscal 2011, certain information systems expenses previously included in unallocated corporate overhead have been allocated to the segment that is directly benefitting from these costs. The segment operating income is reclassified for all prior periods presented to conform to the current period's presentation.

Net sales by operating segment were as follows:

 

     Three Months Ended
July 31,
   Six Months Ended
July 31,
(Amounts in millions)    2010    2009    2010    2009

Net Sales:

           

Walmart U.S.

   $ 64,654    $ 64,645    $ 126,978    $ 126,272

Walmart International

     25,901      23,332      50,931      43,953

Sam's Club

     12,461      12,191      24,204      23,414
                           

Net sales

   $ 103,016    $ 100,168    $ 202,113    $ 193,639
                           

Operating income by segment was as follows:

 

     Three Months Ended
July 31,
    Six Months Ended
July 31,
 
(Amounts in millions)    2010     2009
As Adjusted
    2010     2009
As Adjusted
 

Operating Income:

        

Walmart U.S.

   $ 4,879      $ 4,890      $ 9,494      $ 9,252   

Walmart International

     1,299        1,112        2,382        1,955   

Sam's Club

     428        418        857        810   

Other

     (416     (491     (806     (915
                                

Operating income

   6,190      5,929      11,927      11,102   

Interest expense, net

     (485     (473     (956     (940
                                

Income from continuing operations before income taxes

   $ 5,705      $ 5,456      $ 10,971      $ 10,162   
                                

The following table sets forth the change in goodwill, by operating segment, for the six months ended July 31, 2010:

 

(Amounts in millions)    Walmart
International
    Walmart
U.S.
   Sam's
Club
   Total  

Balances — February 1, 2010

   $ 15,606      $ 207    $ 313    $ 16,126   

Currency translation

     (216     —        —        (216

Other

     83        —        —        83   
                              

Balances — July 31, 2010

   $ 15,473      $ 207    $ 313    $ 15,993   
                              
Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Loss

Note 9. Accumulated Other Comprehensive Loss

The following table sets forth the changes in the composition of accumulated other comprehensive loss for the six months ended July 31, 2010:

 

(Amounts in millions)    Currency
Translation
    Derivative
Instruments
    Minimum
Pension Liability
    Total  

Balances — February 1, 2010

   $ 348      $ 77      $ (495   $ (70

Currency translation adjustment

     (1,004     —          —          (1,004

Net change in fair value of derivatives

     —          (25     —          (25
                                

Balances — July 31, 2010

   $ (656   $ 52      $ (495   $ (1,099
                                

The currency translation adjustment includes a net translation loss of $593 million at July 31, 2010 related to the net investment hedges of our operations in the U.K. and Japan. During the six months ended July 31, 2010, we reclassified $111 million from accumulated other comprehensive loss to earnings to offset currency translation gains on the re-measurement of non-U.S. denominated debt.

Common Stock Dividends
Common Stock Dividends

Note 10. Common Stock Dividends

On March 4, 2010, the Company's Board of Directors approved an increase in the annual dividend for fiscal 2011 to $1.21 per share, an increase of 11% over the dividends paid in fiscal 2010. The annual dividend will be paid in four quarterly installments on April 5, 2010, June 1, 2010, September 7, 2010 and January 3, 2011 to holders of record on March 12, May 14, August 13 and December 10, 2010, respectively. The dividend installments payable on April 5, 2010 and June 1, 2010 were paid as scheduled.

Legal Proceedings
Legal Proceedings

Note 11. Legal Proceedings

The Company is involved in a number of legal proceedings. The Company has made accruals with respect to these matters, where appropriate, which are reflected in the Company's consolidated financial statements. For some matters, the amount of liability is not probable or the amount cannot be reasonably estimated and therefore accruals have not been made. However, where a liability is reasonably possible and material, such matters have been disclosed. The Company may enter into discussions regarding settlement of these matters, and may enter into settlement agreements, if it believes settlement is in the best interest of the Company's shareholders. The matters, or groups of related matters, discussed below, if decided adversely to or settled by the Company, individually or in the aggregate, may result in liability material to the Company's financial condition or results of operations.

Wage-and-Hour Class Actions: The Company is a defendant in various cases containing class-action allegations in which the plaintiffs are current and former hourly associates who allege that the Company committed wage-and-hour violations by failing to provide rest breaks, meal periods, or other benefits, or otherwise by failing to pay them correctly. The complaints generally seek unspecified monetary damages, injunctive relief, or both. The Company cannot reasonably estimate the possible loss or range of loss that may arise from these lawsuits, except where the lawsuit has been settled or otherwise as noted below.

In one of the wage-and-hour lawsuits, Braun/Hummel v. Wal-Mart Stores, Inc., a trial was commenced in September 2006, in Philadelphia, Pennsylvania. The plaintiffs allege that the Company failed to pay class members for all hours worked and prevented class members from taking their full meal and rest breaks. On October 13, 2006, the jury awarded back-pay damages to the plaintiffs of approximately $78 million on their claims for off-the-clock work and missed rest breaks. The jury found in favor of the Company on the plaintiffs' meal-period claims. On November 14, 2007, the trial judge entered a final judgment in the approximate amount of $188 million, which included the jury's back-pay award plus statutory penalties, prejudgment interest and attorneys' fees. The Company believes it has substantial factual and legal defenses to the claims at issue, and on December 7, 2007, the Company filed its Notice of Appeal.

Exempt Status Cases: The Company is a defendant in several cases in which the plaintiffs seek class or collective certification of various groups of salaried managers, and challenge their exempt status under state and federal laws. In one of those cases (Sepulveda v. Wal-Mart Stores, Inc.), class certification was denied by the trial court on May 5, 2006. On April 25, 2008, a three-judge panel of the United States Court of Appeals for the Ninth Circuit affirmed the trial court's ruling in part and reversed it in part, and remanded the case for further proceedings. On May 16, 2008, the Company filed a petition seeking review of that ruling by a larger panel of the court. On October 10, 2008, the court entered an Order staying all proceedings in the Sepulveda appeal pending the final disposition of the appeal in Dukes v. Wal-Mart Stores, Inc., discussed below. Class certification has not been addressed in the other cases. The Company cannot reasonably estimate the possible loss or range of loss that may arise from these lawsuits.

Gender Discrimination Cases: The Company is a defendant in Dukes v. Wal-Mart Stores, Inc., a class-action lawsuit commenced in June 2001 in the United States District Court for the Northern District of California. The complaint alleges that the Company has engaged in a pattern and practice of discriminating against women in promotions, pay, training and job assignments. The complaint seeks, among other things, injunctive relief, front pay, back pay, punitive damages and attorneys' fees. On June 21, 2004, the district court issued an order granting in part and denying in part the plaintiffs' motion for class certification. The class, which was certified by the district court for purposes of liability, injunctive and declaratory relief, punitive damages and lost pay, subject to certain exceptions, includes all women employed at any Wal-Mart domestic retail store at any time since December 26, 1998, who have been or may be subjected to the pay and management track promotions policies and practices challenged by the plaintiffs.

On August 31, 2004, the United States Court of Appeals for the Ninth Circuit granted the Company's petition for discretionary review of the ruling. On February 6, 2007, a divided three-judge panel of the court of appeals issued a decision affirming the district court's certification order. On February 20, 2007, the Company filed a petition asking that the decision be reconsidered by a larger panel of the court. On December 11, 2007, the three-judge panel withdrew its opinion of February 6, 2007, and issued a revised opinion. As a result, the Company's Petition for Rehearing En Banc was denied as moot. The Company filed a new Petition for Rehearing En Banc on January 8, 2008. On February 13, 2009, the court of appeals issued an Order granting the Petition. On April 26, 2010, the Ninth Circuit issued a divided (6-5) opinion affirming certain portions of the district court's ruling and reversing other portions. On August 25, 2010, the Company filed a petition for a writ of certiorari to the United States Supreme Court seeking review of the Ninth Circuit's decision. On May 14, 2010, after the parties moved jointly for a stay pending final resolution of the Company's petition for a writ of certiorari, the district court stayed further proceedings until the earlier of (1) the Supreme Court's resolution of the Company's petition or (2) September 30, 2010. 

If the Company is not successful in its appeal of class certification, or an appellate court issues a ruling that allows for the certification of a class or classes with a different size or scope, and if there is a subsequent adverse verdict on the merits from which there is no successful appeal, or in the event of a negotiated settlement of the litigation, the resulting liability could be material to the Company's financial condition or results of operations. The plaintiffs also seek punitive damages which, if awarded, could result in the payment of additional amounts material to the Company's financial condition or results of operations. However, because of the uncertainty of the outcome of the appeal, because of the uncertainty of the balance of the proceedings contemplated by the district court, and because the Company's liability, if any, arising from the litigation, including the size of any damages award if plaintiffs are successful in the litigation or any negotiated settlement, could vary widely, the Company cannot reasonably estimate the possible loss or range of loss that may arise from the litigation.

Hazardous Materials Investigations: On November 8, 2005, the Company received a grand jury subpoena from the United States Attorney's Office for the Central District of California, seeking documents and information relating to the Company's receipt, transportation, handling, identification, recycling, treatment, storage and disposal of certain merchandise that constitutes hazardous materials or hazardous waste. The Company has been informed by the U.S. Attorney's Office for the Central District of California that it is a target of a criminal investigation into potential violations of the Resource Conservation and Recovery Act ("RCRA"), the Clean Water Act and the Hazardous Materials Transportation Statute. This U.S. Attorney's Office contends, among other things, that the use of Company trucks to transport certain returned merchandise from the Company's stores to its return centers is prohibited by RCRA because those materials may be considered hazardous waste. The government alleges that, to comply with RCRA, the Company must ship from the store certain materials as "hazardous waste" directly to a certified disposal facility using a certified hazardous waste carrier. The U.S. Attorney's Office in the Northern District of California subsequently joined in this investigation. The Company contends that the practice of transporting returned merchandise to its return centers for subsequent disposition, including disposal by certified facilities, is compliant with applicable laws and regulations. While management cannot predict the ultimate outcome of this matter, management does not believe the outcome will have a material effect on the Company's financial condition or results of operations.

Acquisitions
Acquisitions

Note 12. Acquisitions

On May 27, 2010, we announced an agreement with Dansk Supermarked A/S, whereby ASDA, our subsidiary in the United Kingdom, will purchase Netto Foodstores Limited ("Netto"). Netto operates 193 stores averaging 8,000 square feet. The transaction is subject to regulatory approval and is expected to close in fiscal 2011. The estimated purchase price is approximately £778 million ($1.2 billion).

Net Income Per Common Share (Tables)
Summary of Net Income, Table
     Three Months Ended
July 31,
    Six Months Ended
July 31,
 
(Amounts in millions)    2010     2009
As Adjusted
    2010     2009
As Adjusted
 

Income from continuing operations

   $ 3,747      $ 3,586      $ 7,191      $ 6,707   

Less consolidated net income attributable to noncontrolling interest

     (151     (107     (294     (224
                                

Income from continuing operations attributable to Walmart

     3,596        3,479        6,897        6,483   

Loss from discontinued operations, net of tax

     —          (7     —          (15
                                

Consolidated net income attributable to Walmart

   $ 3,596      $ 3,472      $ 6,897      $ 6,468   
                                
Accounting Change (Tables)
(Amounts in millions except per share data)    Three Months Ended July 31, 2009    Six Months Ended July 31, 2009
     As Reported    Adjustments     As Adjusted    As Reported    Adjustments     As Adjusted

Condensed Consolidated Statements of Income:

               

Cost of sales (1)

   $ 75,153    $ (97   $ 75,056    $ 145,541    $ (90   $ 145,451

Operating income

     5,882      47        5,929      11,099      3        11,102

Provision for income taxes

     1,853      17        1,870      3,456      (1     3,455

Income from continuing operations

     3,556      30        3,586      6,703      4        6,707

Consolidated net income attributable to Walmart

     3,442      30        3,472      6,464      4        6,468

Basic net income per share attributable to Walmart

     0.88      0.01        0.89      1.66      —          1.66

Diluted net income per share attributable to Walmart

     0.88      0.01        0.89      1.65      —          1.65

 

(1)

The cost of sales adjustments includes $(47) million and $(3) million pertaining to the accounting change for the three and six months ended July 31, 2009, respectively. Certain reclassifications that had no effect on operating income or on the consolidated net income attributable to Walmart represent the remainder of the amounts included in the cost of sales adjustment columns above.

     July 31, 2009    January 31, 2010
(Amounts in millions)    As Reported    Adjustments     As Adjusted    As Reported    Adjustments     As Adjusted

Condensed Consolidated Balance Sheets:

               

Inventories

   $ 33,861    $ (496   $ 33,365    $ 33,160    $ (447   $ 32,713

Prepaid expenses and other

     3,336      163        3,499      2,980      148        3,128

Accrued income taxes

     1,162      (20     1,142      1,365      (18     1,347

Retained earnings

     63,153      (313     62,840      66,638      (281     66,357
Fair Value Measurements (Tables)
     July 31, 2010    January 31, 2010
(Amounts in millions)    Carrying Value    Fair Value    Carrying Value    Fair Value

Long-term debt

   $ 41,175    $ 44,407     $ 37,281    $ 39,055
     July 31, 2010     January 31, 2010  
(Amounts in millions)    Notional
Amount
   Fair
Value
    Notional
Amount
   Fair
Value
 

Receive fixed-rate, pay floating-rate interest rate swaps designated as fair value hedges

   $ 4,445    $ 316      $ 4,445    $ 260   

Receive fixed-rate, pay fixed-rate cross-currency interest rate swaps designated as net investment hedges

     1,250      312        1,250      189   

Receive floating-rate, pay fixed-rate interest rate swaps designated as cash flow hedges

     638      (20     638      (20

Receive fixed-rate, pay fixed-rate cross-currency interest rate swaps designated as cash flow hedges

     2,902      74        2,902      286   
                              

Total

   $ 9,235    $ 682      $ 9,235    $ 715   
                              
Derivative Financial Instruments (Tables)
Balance Sheet classification of financial instruments
     July 31, 2010    January 31, 2010
(Amounts in millions)    Fair Value
Instruments
   Net
Investment

Hedge
   Cash Flow
Instruments
   Fair Value
Instruments
   Net
Investment
Hedge
   Cash Flow
Instruments

Balance Sheet Classification:

                 

Other assets and deferred charges

   $ 316    $ 312    $ 74    $ 260    $ 189    $ 286
                                         

Asset Subtotals

   $ 316    $ 312    $ 74    $ 260    $ 189    $ 286
                                         

Long-term debt

   $ 316    $ —      $ —      $ 260    $ —      $ —  

Deferred income taxes and other

     —        —        20      —        —        20
                                         

Liability Subtotals

   $ 316    $ —      $ 20    $ 260    $ —      $ 20
Segments (Tables)
     Three Months Ended
July 31,
   Six Months Ended
July 31,
(Amounts in millions)    2010    2009    2010    2009

Net Sales:

           

Walmart U.S.

   $ 64,654    $ 64,645    $ 126,978    $ 126,272

Walmart International

     25,901      23,332      50,931      43,953

Sam's Club

     12,461      12,191      24,204      23,414
                           

Net sales

   $ 103,016    $ 100,168    $ 202,113    $ 193,639
                           
     Three Months Ended
July 31,
    Six Months Ended
July 31,
 
(Amounts in millions)    2010     2009
As Adjusted
    2010     2009
As Adjusted
 

Operating Income:

        

Walmart U.S.

   $ 4,879      $ 4,890      $ 9,494      $ 9,252   

Walmart International

     1,299        1,112        2,382        1,955   

Sam's Club

     428        418        857        810   

Other

     (416     (491     (806     (915
                                

Operating income

   6,190      5,929      11,927      11,102   

Interest expense, net

     (485     (473     (956     (940
                                

Income from continuing operations before income taxes

   $ 5,705      $ 5,456      $ 10,971      $ 10,162   
                                
(Amounts in millions)    Walmart
International
    Walmart
U.S.
   Sam's
Club
   Total  

Balances — February 1, 2010

   $ 15,606      $ 207    $ 313    $ 16,126   

Currency translation

     (216     —        —        (216

Other

     83        —        —        83   
                              

Balances — July 31, 2010

   $ 15,473      $ 207    $ 313    $ 15,993   
                              
Accumulated Other Comprehensive Loss (Tables)
Changes in the composition of accumulated other comprehensive loss
(Amounts in millions)    Currency
Translation
    Derivative
Instruments
    Minimum
Pension Liability
    Total  

Balances — February 1, 2010

   $ 348      $ 77      $ (495   $ (70

Currency translation adjustment

     (1,004     —          —          (1,004

Net change in fair value of derivatives

     —          (25     —          (25
                                

Balances — July 31, 2010

   $ (656   $ 52      $ (495   $ (1,099
                                
Net Income Per Common Share (Details) (USD $)
In Millions
3 Months Ended
Jul. 31,
6 Months Ended
Jul. 31,
2010
2009
2010
2009
Dilutive effect of outstanding stock options and other share-based awards
11 
14 
10 
Ant-dilutive number of shares from stock options and share-based awards
 
 
19 
29 
Income from continuing operations
$ 3,747 
$ 3,586 
$ 7,191 
$ 6,707 
Less comprehensive income attributable to the noncontrolling interest
(151)
(107)
(294)
(224)
Income from continuing operations attributable to Walmart
3,596 
3,479 
6,897 
6,483 
Loss from discontinued operations, net of tax
 
(7)
 
(15)
Consolidated net income attributable to Walmart
$ 3,596 
$ 3,472 
$ 6,897 
$ 6,468 
Accounting Change (Details) (USD $)
In Millions, except Per Share data
3 Months Ended
Jul. 31, 2009
6 Months Ended
Jul. 31, 2009
Cost of sales
$ 75,056 1
$ 145,451 1
Operating income
5,929 
11,102 
Provision for income taxes
1,870 
3,455 
Income from continuing operations
3,586 
6,707 
Consolidated net income attributable to Walmart
3,472 
6,468 
Basic net income per common share attributable to Walmart
0.89 
1.66 
Diluted net income per share attributable to Walmart
0.89 
1.65 
Cost of sales adjustment
(47)
(3)
Inventories
33,365 
33,365 
Prepaid expenses and other
3,499 
3,499 
Accrued income taxes
1,142 
1,142 
Retained earnings
$ 62,840 
$ 62,840 
Debt (Details)
Jul. 08, 2010
Jun. 28, 2010
Apr. 01, 2010
6 Months Ended
Jul. 31, 2010
Apr. 01, 2010
Apr. 01, 2010
6 Months Ended
Jul. 31, 2010
Jul. 08, 2010
6 Months Ended
Jul. 31, 2010
Jul. 08, 2010
6 Months Ended
Jul. 31, 2010
Jul. 08, 2010
6 Months Ended
Jul. 31, 2010
Jul. 28, 2010
6 Months Ended
Jul. 31, 2010
Jul. 28, 2010
6 Months Ended
Jul. 31, 2010
Jul. 28, 2010
Jul. 31, 2009
Jul. 31, 2009
Jun. 30, 2009
Jun. 30, 2009
Principal amount of notes
 
 
 
 
750,000,000 
1,250,000,000 
 
750,000,000 
 
1,500,000,000 
 
750,000,000 
 
60,000,000,000 
 
10,000,000,000 
 
30,000,000,000 
 
 
 
 
Interest rate
 
 
 
 
0.02875 
0.05625 
 
0.0225 
 
0.03625 
 
0.04875 
 
0.0094 
 
0.016 
 
 
 
 
 
 
Interest rate to be added to three month LIBOR
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
0.0045 
 
 
 
 
Aggregate net proceeds from note issuance
3,000,000,000 
1,000,000,000 
2,000,000,000 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Date of first required payment
 
 
 
01-08-2011 
 
 
 
 
 
 
 
 
01-28-2011 
 
01-28-2011 
 
10-28-2010 
 
 
 
 
 
Maturity date
 
 
 
 
 
 
2015-07-08 
 
2020-07-08 
 
2040-07-08 
 
2015-07-28 
 
2020-07-28 
 
2015-07-28 
 
 
 
 
 
Interest accrual start date
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
01-28-2010 
 
 
 
 
 
Line of Credit Facility, Maximum Borrowing Capacity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
9,000,000,000 
7,000,000,000 
2,230,000,000 
2,350,000,000 
Fair Value Measurements (Details) (USD $)
In Millions
Jul. 31, 2010
Jan. 31, 2010
Long-term debt, Carrying Value
$ 41,175 
$ 37,281 
Long-term debt, Fair Value
44,407 
39,055 
Total Notional Amount
9,235 
9,235 
Fair Value Hedging [Member] | Fixed-rate interest rate swaps [Member] | Floating-rate interest rate swaps [Member]
 
 
Total Notional Amount
4,445 
4,445 
Fair Value Hedging [Member] | Fixed-rate interest rate swaps [Member] | Floating-rate interest rate swaps [Member] | Fair Value, Inputs, Level 2 [Member]
 
 
Total Fair Value
316 
260 
Net Investment Hedging [Member] | Cross Currency Interest Rate Contract [Member] | Fixed-rate interest rate swaps [Member]
 
 
Total Notional Amount
1,250 
1,250 
Net Investment Hedging [Member] | Cross Currency Interest Rate Contract [Member] | Fixed-rate interest rate swaps [Member] | Fair Value, Inputs, Level 2 [Member]
 
 
Total Fair Value
312 
189 
Cash Flow Hedging [Member] | Cross Currency Interest Rate Contract [Member] | Fixed-rate interest rate swaps [Member]
 
 
Total Notional Amount
2,902 
2,902 
Cash Flow Hedging [Member] | Cross Currency Interest Rate Contract [Member] | Fixed-rate interest rate swaps [Member] | Fair Value, Inputs, Level 2 [Member]
 
 
Total Fair Value
74 
286 
Cash Flow Hedging [Member] | Fixed-rate interest rate swaps [Member] | Floating-rate interest rate swaps [Member]
 
 
Total Notional Amount
638 
638 
Cash Flow Hedging [Member] | Fixed-rate interest rate swaps [Member] | Floating-rate interest rate swaps [Member] | Fair Value, Inputs, Level 2 [Member]
 
 
Total Fair Value
(20)
(20)
Fair Value, Inputs, Level 2 [Member]
 
 
Total Fair Value
$ 682 
$ 715 
Derivative Financial Instruments (Details)
6 Months Ended
Jul. 31,
Jul. 31, 2010
Jul. 31, 2010
6 Months Ended
Jul. 31, 2010
Jan. 31, 2010
6 Months Ended
Jul. 31, 2010
Jan. 31, 2010
2010
2010
Jan. 31, 2010
6 Months Ended
Jul. 31, 2010
Jul. 31, 2010
Cash collateral held from counterparties
 
327,000,000 
 
 
 
 
 
 
 
 
 
Threshold of derivative liability position requiring cash collateral
 
150,000,000 
 
 
 
 
 
 
 
 
 
Debt designated as United Kingdom net investment hedge
 
 
 
 
 
 
 
 
 
 
3,000,000,000 
Debt designated as Japanese net investment hedge
437,000,000,000 
 
 
 
 
 
 
 
 
 
 
Other assets and deferred charges
 
4,092,000,000 
316,000,000 
260,000,000 
312,000,000 
189,000,000 
 
74,000,000 
286,000,000 
 
 
Asset Subtotals
 
 
316,000,000 
260,000,000 
312,000,000 
189,000,000 
 
74,000,000 
286,000,000 
 
 
Long-term debt
 
35,629,000,000 
316,000,000 
260,000,000 
 
 
 
 
 
 
 
Deferred income taxes and other
 
5,368,000,000 
 
 
 
 
 
20,000,000 
20,000,000 
 
 
Liability Subtotals
 
 
316,000,000 
260,000,000 
 
 
 
20,000,000 
20,000,000 
 
 
Instrument maturity date range start
 
 
Feb 2011 
 
Oct 2023 
 
Jan 2011 
Aug 2013 
 
Sep 2029 
 
Instrument maturity date range end
 
 
May 2014 
 
Feb 2030 
 
Jan 2039 
Jul 2015 
 
Mar 2034 
 
Segments (Details) (USD $)
In Millions
6 Months Ended
Jul. 31, 2010
Net sales
$ 202,113 
Operating income
11,927 
Interest, net
(956)
Income from continuing operations before income taxes
10,971 
Balances - February 1, 2010
16,126 
Currency translation
(216)
Other
83 
Balances - July 31, 2010
15,993 
Walmart US [Member]
 
Net sales
126,978 
Operating income
9,494 
Balances - February 1, 2010
207 
Balances - July 31, 2010
207 
Walmart International [Member]
 
Net sales
50,931 
Operating income
2,382 
Balances - February 1, 2010
15,606 
Currency translation
(216)
Other
83 
Balances - July 31, 2010
15,473 
Sam's Club [Member]
 
Net sales
24,204 
Operating income
857 
Balances - February 1, 2010
313 
Balances - July 31, 2010
313 
Other Segments [Member]
 
Operating income
$ (806)
Accumulated Other Comprehensive Loss (Details)
In Millions
6 Months Ended
Jul. 31,
2010
2010
2010
Balances - February 1, 2010
(70)
 
348 
Currency translation adjustment
(1,004)
 
(1,004)
Net change in fair value of derivatives
(25)
 
 
Balances - July 31, 2010
(1,099)
 
(656)
Net translation loss related to net investment hedges
 
593 
 
Currency translation gains on the re-measurement, non US debt
111 
 
 
Common Stock Dividends (Details) (USD $)
6 Months Ended
Jul. 31, 2010
Annual dividend approved by Board of Directors for 2011
$ 1.21 
Percentage increase over 2010 dividend
0.11 
Number of dividend payments for 2010
Legal Proceedings (Details)
In Millions
Oct. 13, 2006
15 Months Ended
Nov. 14, 2007
Jury Award
78 
 
Litigation Settlement, Gross
 
188 
Acquisitions (Details)
In Millions
6 Months Ended
Jul. 31,
2010
2010
Company subsidiary, ASDA signs agreement with Dansk Supermarket on May 27, 2010 to purchase Netto foodstores
 
Number of Stores Operated by Netto
 
193 
Average Square Footage Netto Store
 
8,000 
Business Acquisition Estimated Cost Of Acquired Entity Purchase Price
£ 778 
$ 1,200 
Netto Foodstores Limited