Analysis of Reportable Segments
Best Buy Co. Inc. operates in 2 segments: Domestic and International.
Segment Profit Margin
Best Buy Co. Inc., profit margin by reportable segment
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 5.84% | 5.42% | 4.75% | 4.57% | 4.53% | 4.87% |
| International | 6.21% | 1.08% | 2.89% | 2.88% | 2.61% | 2.85% |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
The segment profit margins reveal contrasting performance trends between the domestic and international operations from 2017 to 2022. The domestic segment shows a pattern of steady improvement, while the international segment experienced significant fluctuations, culminating in a sharp increase in the final year.
- Domestic Segment Performance
- The domestic profit margin remained relatively stable between 2017 and 2020, fluctuating within a narrow range between 4.53% and 4.87%. Beginning in 2021, a clear upward trajectory emerged, with margins rising to 5.42% and reaching a period high of 5.84% by January 29, 2022. This indicates a consistent expansion of profitability within the domestic market over the latter half of the observed timeframe.
- International Segment Performance
- International margins exhibited considerably higher volatility. After maintaining a range between 2.61% and 2.89% from 2017 through 2020, the margin experienced a substantial contraction to 1.08% in 2021. This decline was followed by a rapid and significant recovery in 2022, where the margin surged to 6.21%, marking the highest margin recorded across all segments and years in the provided set.
- Comparative Segment Analysis
- For the majority of the period analyzed, the domestic segment maintained a consistent profit margin advantage over the international segment. However, this dynamic shifted in the final reporting year of 2022, when the international segment's margin of 6.21% surpassed the domestic margin of 5.84%.
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Segment Profit Margin: Domestic
Best Buy Co. Inc.; Domestic; segment profit margin calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income | 2,795) | 2,348) | 1,907) | 1,797) | 1,752) | 1,764) |
| Revenue | 47,830) | 43,293) | 40,114) | 39,304) | 38,662) | 36,248) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | 5.84% | 5.42% | 4.75% | 4.57% | 4.53% | 4.87% |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment profit margin = 100 × Operating income ÷ Revenue
= 100 × 2,795 ÷ 47,830 = 5.84%
The domestic segment exhibits a trajectory of sustained top-line growth and an accelerating improvement in operating profitability between 2017 and 2022. Revenue increased steadily throughout the period, while the segment profit margin experienced an initial dip before entering a phase of significant expansion.
- Revenue Performance
- A consistent upward trend is observed in revenue, which grew from US$ 36,248 million in 2017 to US$ 47,830 million by 2022. This represents a continuous expansion of sales volume over the six-year span.
- Operating Income Trajectory
- Operating income remained relatively stable between 2017 and 2019, fluctuating slightly between US$ 1,752 million and US$ 1,797 million. A sharp acceleration in growth occurred after 2020, with income rising to US$ 2,348 million in 2021 and reaching US$ 2,795 million in 2022.
- Segment Profit Margin Analysis
- The segment profit margin initially declined from 4.87% in 2017 to a low of 4.53% in 2018. Following this contraction, a recovery trend was established, with the margin climbing to 4.75% by 2020. The most significant expansion occurred in the final two years of the period, where the margin rose to 5.42% in 2021 and 5.84% in 2022, indicating an improvement in operational efficiency and a greater capacity to convert revenue into operating profit.
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Segment Profit Margin: International
Best Buy Co. Inc.; International; segment profit margin calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income | 244) | 43) | 102) | 103) | 91) | 90) |
| Revenue | 3,931) | 3,969) | 3,524) | 3,575) | 3,489) | 3,155) |
| Segment Profitability Ratio | ||||||
| Segment profit margin1 | 6.21% | 1.08% | 2.89% | 2.88% | 2.61% | 2.85% |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment profit margin = 100 × Operating income ÷ Revenue
= 100 × 244 ÷ 3,931 = 6.21%
The international segment exhibited fluctuating profitability and revenue growth between 2017 and 2022. While revenue followed a general upward trajectory, operating income and profit margins experienced significant volatility in the final two years of the analyzed period.
- Revenue Growth Patterns
- Revenue grew steadily from 3,155 million USD in 2017 to a peak of 3,969 million USD in 2021. Following this peak, a slight contraction occurred in 2022, with revenue settling at 3,931 million USD. This indicates a period of expansion followed by a plateau in market scale.
- Operating Income Volatility
- Operating income remained relatively stable from 2017 to 2020, fluctuating within a narrow band between 90 million USD and 103 million USD. A sharp decline was recorded in 2021, where income dropped to 43 million USD. This was followed by a substantial increase in 2022, with operating income rising to 244 million USD, marking a significant deviation from the prior five-year average.
- Segment Profit Margin Analysis
- The segment profit margin was characterized by stability between 2017 and 2020, maintaining a range between 2.61% and 2.89%. A notable compression occurred in 2021, with the margin falling to 1.08%, which coincided with the lowest operating income despite the highest revenue in the period. By 2022, the margin expanded dramatically to 6.21%, indicating a strong recovery in operational efficiency and a significant increase in the conversion of revenue to operating profit.
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Segment Return on Assets (Segment ROA)
Best Buy Co. Inc., ROA by reportable segment
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 17.45% | 13.32% | 13.39% | 15.09% | 15.16% | 14.12% |
| International | 16.40% | 2.98% | 7.59% | 10.37% | 6.08% | 6.62% |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
Analysis of the segment return on assets reveals a general upward trajectory in the final period, although the two reportable segments exhibited distinct volatility profiles over the six-year duration.
- Domestic Segment Performance
- The Domestic segment demonstrated consistent performance from 2017 through 2021, with returns on assets fluctuating within a relatively narrow band between 13.32% and 15.16%. This period of stability was followed by a significant expansion in 2022, where the segment reached its peak ROA of 17.45%.
- International Segment Performance
- The International segment was characterized by substantial volatility. Following a rise to 10.37% in 2019, returns experienced a sharp decline, reaching a period low of 2.98% by January 30, 2021. A rapid recovery occurred in the subsequent year, with the ROA surging to 16.40%, marking the highest return for this segment in the analyzed timeframe.
- Comparative Analysis
- Historically, the Domestic segment maintained a higher and more stable return on assets compared to the International segment. However, the performance gap converged significantly by 2022, as both segments reached their maximum efficiency levels simultaneously, ending the period with returns of 17.45% and 16.40%, respectively.
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Segment ROA: Domestic
Best Buy Co. Inc.; Domestic; segment ROA calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income | 2,795) | 2,348) | 1,907) | 1,797) | 1,752) | 1,764) |
| Assets | 16,016) | 17,625) | 14,247) | 11,908) | 11,553) | 12,496) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | 17.45% | 13.32% | 13.39% | 15.09% | 15.16% | 14.12% |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment ROA = 100 × Operating income ÷ Assets
= 100 × 2,795 ÷ 16,016 = 17.45%
The domestic segment exhibits a general trajectory of increasing profitability characterized by a steady rise in operating income and fluctuating asset utilization, culminating in a peak return on assets in the final period.
- Operating Income Performance
- Operating income demonstrated consistent growth over the six-year period. After remaining relatively flat between 2017 and 2018, income grew steadily from 1,797 million USD in 2019 to 2,795 million USD by 2022. The most significant acceleration occurred between 2020 and 2022, where income increased by approximately 46%.
- Asset Base Volatility
- The asset base experienced significant fluctuations. A period of contraction and stability occurred between 2017 and 2019, followed by a rapid expansion that peaked in 2021 at 17,625 million USD. A subsequent reduction in assets to 16,016 million USD in 2022 suggests a strategic realignment or a reduction in working capital requirements.
- Segment Return on Assets (ROA) Analysis
- Segment ROA followed a U-shaped pattern during the middle of the period. After peaking at 15.16% in 2018, the ROA declined to a low of 13.32% in 2021. This decline coincided with the period of most rapid asset growth, indicating that the increase in the asset base initially outpaced the growth in operating income. However, 2022 saw a sharp recovery to 17.45%, the highest value in the series, driven by the simultaneous increase in operating income and the reduction in total assets.
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Segment ROA: International
Best Buy Co. Inc.; International; segment ROA calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income | 244) | 43) | 102) | 103) | 91) | 90) |
| Assets | 1,488) | 1,442) | 1,344) | 993) | 1,496) | 1,360) |
| Segment Profitability Ratio | ||||||
| Segment ROA1 | 16.40% | 2.98% | 7.59% | 10.37% | 6.08% | 6.62% |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment ROA = 100 × Operating income ÷ Assets
= 100 × 244 ÷ 1,488 = 16.40%
The International segment exhibited significant volatility in both operational profitability and asset efficiency between 2017 and 2022. While the period began with relative stability, it concluded with a substantial increase in both operating income and return on assets, following a sharp contraction in 2021.
- Operating Income Trends
- Operating income remained relatively stable from 2017 to 2020, fluctuating between US$ 90 million and US$ 103 million. A significant decline occurred in 2021, where income dropped to US$ 43 million. This was followed by a rapid and substantial recovery in 2022, with operating income reaching a period high of US$ 244 million, representing a nearly six-fold increase from the previous year.
- Asset Base Fluctuations
- Total assets for the segment showed inconsistent movement. After increasing from US$ 1,360 million in 2017 to US$ 1,496 million in 2018, assets decreased sharply to US$ 993 million in 2019. A subsequent recovery trend saw assets climb back to US$ 1,488 million by 2022, returning to levels similar to those seen at the start of the analyzed period.
- Segment Return on Assets (ROA) Analysis
- The Segment ROA demonstrated high variance, mirroring the volatility of operating income and asset levels. A peak in 2019 (10.37%) was driven primarily by the reduction in the asset base despite stable income. The ROA reached its lowest point in 2021 at 2.98%, coinciding with the trough in operating income. The period culminated in a maximum ROA of 16.40% in 2022, resulting from the surge in operating income relative to a stabilized asset base.
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Segment Asset Turnover
Best Buy Co. Inc., asset turnover by reportable segment
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 2.99 | 2.46 | 2.82 | 3.30 | 3.35 | 2.90 |
| International | 2.64 | 2.75 | 2.62 | 3.60 | 2.33 | 2.32 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
The asset turnover ratios for both reportable segments exhibit distinct patterns of volatility and recovery between 2017 and 2022, reflecting fluctuating efficiencies in how assets are utilized to generate revenue.
- Domestic Segment Trends
- The domestic segment experienced an initial increase in asset turnover, rising from 2.90 in 2017 to a peak of 3.35 in 2018. This was followed by a multi-year contraction, where the ratio declined to 2.82 in 2020 and reached a period low of 2.46 by January 30, 2021. A notable recovery occurred in the final period, with the ratio ascending to 2.99 by January 29, 2022.
- International Segment Trends
- International operations maintained a stable baseline of approximately 2.32 to 2.33 during the first two years. A significant spike occurred in February 2, 2019, where the ratio reached 3.60, the highest value recorded across both segments in the analyzed period. Following this peak, the ratio normalized to 2.62 in 2020 and remained relatively stable, fluctuating between 2.64 and 2.75 through 2022.
- Comparative Analysis
- Historically, the domestic segment outperformed the international segment in asset turnover efficiency, except during the 2019 fiscal year when international efficiency peaked sharply. Both segments showed a deviation in performance around 2020 and 2021, although the domestic segment suffered a more pronounced decline before its 2022 rebound. By the end of the period, the domestic segment regained its position as the more efficient generator of revenue per unit of asset.
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Segment Asset Turnover: Domestic
Best Buy Co. Inc.; Domestic; segment asset turnover calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 47,830) | 43,293) | 40,114) | 39,304) | 38,662) | 36,248) |
| Assets | 16,016) | 17,625) | 14,247) | 11,908) | 11,553) | 12,496) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 2.99 | 2.46 | 2.82 | 3.30 | 3.35 | 2.90 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment asset turnover = Revenue ÷ Assets
= 47,830 ÷ 16,016 = 2.99
The domestic segment exhibited a consistent upward trajectory in revenue from 2017 to 2022, increasing from US$ 36,248 million to US$ 47,830 million. In contrast, the asset base fluctuated, reaching a peak of US$ 17,625 million in 2021 before declining to US$ 16,016 million in 2022. This divergence between steady revenue growth and volatile asset levels directly influenced the efficiency of asset utilization over the period.
- Revenue Growth Patterns
- A sustained increase in revenue is observed throughout the reporting period. The most significant acceleration occurred between January 2021 and January 2022, where revenue increased by approximately 10.5%, which contributed to a strengthening of the asset turnover ratio in the final year.
- Segment Asset Turnover Trends
- The asset turnover ratio experienced a period of volatility, peaking at 3.35 in February 2018. A subsequent downward trend is observed, with the ratio declining to a period low of 2.46 by January 2021. This decline coincided with a substantial expansion of the asset base, which grew from US$ 11,553 million in 2018 to US$ 17,625 million in 2021, outpacing revenue growth during that specific timeframe.
- Operational Efficiency Recovery
- A recovery in asset utilization efficiency is noted in 2022, as the turnover ratio rose to 2.99. This improvement was driven by the simultaneous realization of higher annual revenues and a reduction in total segment assets, indicating a more optimized relationship between the asset base and sales generation.
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Segment Asset Turnover: International
Best Buy Co. Inc.; International; segment asset turnover calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 3,931) | 3,969) | 3,524) | 3,575) | 3,489) | 3,155) |
| Assets | 1,488) | 1,442) | 1,344) | 993) | 1,496) | 1,360) |
| Segment Activity Ratio | ||||||
| Segment asset turnover1 | 2.64 | 2.75 | 2.62 | 3.60 | 2.33 | 2.32 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment asset turnover = Revenue ÷ Assets
= 3,931 ÷ 1,488 = 2.64
The International segment exhibited a general increase in revenue and fluctuations in asset efficiency between 2017 and 2022. While revenue followed a predominantly upward trajectory, the asset base experienced a significant contraction in 2019, resulting in a temporary spike in the segment asset turnover ratio before stabilizing at a higher level than the initial baseline.
- Revenue Performance
- Revenue grew from US$ 3,155 million in 2017 to US$ 3,931 million in 2022. The most substantial growth occurred between 2020 and 2021, when revenue increased from US$ 3,524 million to a period peak of US$ 3,969 million.
- Asset Base Volatility
- The segment's asset levels remained relatively consistent between US$ 1,344 million and US$ 1,496 million for most of the period, with a notable exception in 2019 when assets dropped to US$ 993 million. Subsequent years saw a recovery in the asset base, returning to US$ 1,488 million by January 29, 2022.
- Segment Asset Turnover Trends
- Asset turnover remained stable at approximately 2.32 to 2.33 during 2017 and 2018. A peak efficiency ratio of 3.60 was observed in 2019, which is directly attributable to the sharp decline in the asset base relative to steady revenue. Following this event, the ratio normalized but remained elevated, fluctuating between 2.62 and 2.75 from 2020 through 2022, suggesting an overall improvement in how the segment generates revenue from its assets compared to 2017 levels.
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Segment Capital Expenditures to Depreciation
Best Buy Co. Inc., capital expenditures to depreciation by reportable segment
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 0.94 | 0.97 | 1.01 | 1.12 | 0.96 | 0.86 |
| International | 0.94 | 0.60 | 0.88 | 0.82 | 1.58 | 1.37 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
The capital expenditure to depreciation ratios for the Domestic and International segments demonstrate divergent investment strategies and volatility profiles between 2017 and 2022. While the Domestic segment maintained relatively stable investment levels, the International segment experienced significant fluctuations in its capital allocation relative to asset depreciation.
- Domestic Segment Analysis
- The ratio exhibited a steady increase from 0.86 in 2017 to a peak of 1.12 in 2019, indicating a period where capital expenditures exceeded annual depreciation. Following this peak, a gradual downward trend occurred, with the ratio moderating to 1.01 in 2020, 0.97 in 2021, and ending at 0.94 in 2022. This pattern suggests a strategic transition from asset expansion or aggressive upgrading toward a maintenance-oriented capital expenditure policy.
- International Segment Analysis
- Significant volatility is observed in the International segment, which began with a ratio of 1.37 in 2017 and reached a peak of 1.58 in 2018, reflecting heavy investment relative to the depreciation of the asset base. A sharp contraction followed in 2019, with the ratio dropping to 0.82. After a slight increase in 2020, the ratio reached a period low of 0.60 in 2021 before recovering to 0.94 in 2022. This volatility suggests inconsistent capital investment cycles or strategic shifts in international market presence.
- Comparative Segment Convergence
- Throughout the analysis period, the International segment generally began with a higher investment-to-depreciation intensity than the Domestic segment. However, from 2019 through 2021, the International ratio remained consistently lower than the Domestic ratio. By the final reporting period ending January 29, 2022, both segments converged at an identical ratio of 0.94, indicating a synchronization of capital spending relative to depreciation across both geographic operations.
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Segment Capital Expenditures to Depreciation: Domestic
Best Buy Co. Inc.; Domestic; segment capital expenditures to depreciation calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Capital expenditures | 691) | 680) | 691) | 770) | 606) | 526) |
| Depreciation | 738) | 704) | 681) | 687) | 631) | 613) |
| Segment Financial Ratio | ||||||
| Segment capital expenditures to depreciation1 | 0.94 | 0.97 | 1.01 | 1.12 | 0.96 | 0.86 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation
= 691 ÷ 738 = 0.94
The domestic segment's investment profile reveals a period of strategic acceleration followed by a transition toward maintenance-level spending. The relationship between capital expenditures and depreciation reflects a shift in asset acquisition intensity over the analyzed period.
- Capital Expenditures Trend
- Investment spending exhibited a strong upward trajectory from 2017 to 2019, increasing from 526 million USD to a peak of 770 million USD. Subsequent to 2019, capital expenditures entered a stabilization phase, remaining consistently between 680 million USD and 691 million USD through 2022.
- Depreciation Expense Analysis
- Depreciation followed a steady and linear growth path, rising from 613 million USD in 2017 to 738 million USD by 2022. This consistent increase indicates a growing base of depreciable fixed assets within the domestic operations.
- Segment Capital Expenditures to Depreciation Ratio
- The ratio shifted from 0.86 in 2017 to a peak of 1.12 in 2019, signaling a period where the company invested in new assets at a rate exceeding the depreciation of existing ones. After 2019, the ratio declined and stabilized, ending at 0.94 in 2022. This movement suggests a strategic pivot from expansionary investment back to a maintenance-focused approach, where capital outlays are slightly lower than the annual depreciation charge.
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Segment Capital Expenditures to Depreciation: International
Best Buy Co. Inc.; International; segment capital expenditures to depreciation calculation
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Capital expenditures | 46) | 33) | 52) | 49) | 82) | 56) |
| Depreciation | 49) | 55) | 59) | 60) | 52) | 41) |
| Segment Financial Ratio | ||||||
| Segment capital expenditures to depreciation1 | 0.94 | 0.60 | 0.88 | 0.82 | 1.58 | 1.37 |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
1 2022 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation
= 46 ÷ 49 = 0.94
The international segment experienced a significant shift in its investment strategy between 2017 and 2022, transitioning from a period of aggressive capital expansion to a phase characterized by asset maintenance and reduced spending.
- Capital Expenditure Trends
- Capital expenditures peaked in February 2018 at 82 million USD, following an initial expenditure of 56 million USD in January 2017. Subsequent years saw a general decline, reaching a low of 33 million USD in January 2021 before a moderate recovery to 46 million USD in January 2022. This volatility suggests a pivot away from the heavy investment phase seen in the 2017-2018 period.
- Depreciation Patterns
- Depreciation costs exhibited a steady increase from 41 million USD in 2017 to a peak of 60 million USD in February 2019. This upward trend reflects the accounting impact of the prior high-investment years. Following 2019, depreciation began a gradual descent, ending at 49 million USD in January 2022, indicating a reduction in the book value of the segment's depreciable asset base.
- Capital Expenditures to Depreciation Ratio
- The ratio of capital expenditures to depreciation serves as a key indicator of whether the segment is expanding or contracting its asset base. In 2017 and 2018, the ratio remained above 1.0, peaking at 1.58, which signifies that investments exceeded the wear and tear of existing assets. From 2019 onward, the ratio dropped below 1.0, hitting a trough of 0.60 in January 2021. This indicates that for the latter four years of the period, the segment invested less than the amount of depreciation recognized, suggesting a strategy of asset consolidation or a reduction in the scale of international operations.
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Revenue
Best Buy Co. Inc., revenue by reportable segment
US$ in millions
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 47,830) | 43,293) | 40,114) | 39,304) | 38,662) | 36,248) |
| International | 3,931) | 3,969) | 3,524) | 3,575) | 3,489) | 3,155) |
| Total | 51,761) | 47,262) | 43,638) | 42,879) | 42,151) | 39,403) |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
Total revenue exhibits a consistent upward trajectory over the analyzed six-year period, growing from US$ 39,403 million in January 2017 to US$ 51,761 million by January 2022. This represents a cumulative increase of approximately 31.4%, characterized by steady annual gains with an acceleration in growth during the final two fiscal years.
- Domestic Segment Performance
- The domestic market serves as the primary driver of overall revenue growth. Revenue in this segment increased from US$ 36,248 million in 2017 to US$ 47,830 million in 2022. A notable surge is observed between January 2021 and January 2022, where revenue grew by US$ 4,537 million, the largest single-year increase in the period.
- International Segment Performance
- International revenue demonstrates a more modest and plateauing growth pattern. Starting at US$ 3,155 million in 2017, the segment reached a peak of US$ 3,969 million in January 2021 before experiencing a slight contraction to US$ 3,931 million by January 2022. The growth rate in this segment is significantly lower than that of the domestic market.
- Segment Revenue Distribution
- The revenue concentration remains heavily weighted toward the domestic segment. Domestic operations accounted for approximately 92% of total revenue in 2017 and increased slightly to approximately 92.4% by 2022. This indicates that the overall expansion of the company is almost exclusively dependent on domestic market penetration and performance.
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Operating income
Best Buy Co. Inc., operating income by reportable segment
US$ in millions
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 2,795) | 2,348) | 1,907) | 1,797) | 1,752) | 1,764) |
| International | 244) | 43) | 102) | 103) | 91) | 90) |
| Total | 3,039) | 2,391) | 2,009) | 1,900) | 1,843) | 1,854) |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
Total operating income exhibited a consistent upward trajectory over the analyzed six-year period, rising from 1,854 million USD in January 2017 to 3,039 million USD by January 2022. The growth pattern was characterized by moderate stability between 2017 and 2020, followed by a period of accelerated expansion in the final two years.
- Domestic Segment Performance
- The domestic segment served as the primary driver of overall operating income. After a period of marginal fluctuations between 2017 and 2019, operating income increased from 1,797 million USD in February 2019 to 2,795 million USD in January 2022. The most significant growth occurred between January 2021 and January 2022, reflecting a substantial increase in profitability within the domestic market.
- International Segment Volatility
- Operating income from international operations displayed significant volatility compared to the domestic segment. While results remained relatively stable between 90 million USD and 103 million USD from 2017 to 2020, a sharp contraction occurred in January 2021, where income fell to 43 million USD. This was followed by a rapid recovery and peak in January 2022, reaching 244 million USD.
- Aggregate Operating Trends
- The total operating income growth reflects a compounding effect of domestic expansion and a late-period surge in international results. Between February 2020 and January 2022, total operating income grew by approximately 51%, indicating a period of heightened operational efficiency or increased market demand during those fiscal years.
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Assets
Best Buy Co. Inc., assets by reportable segment
US$ in millions
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 16,016) | 17,625) | 14,247) | 11,908) | 11,553) | 12,496) |
| International | 1,488) | 1,442) | 1,344) | 993) | 1,496) | 1,360) |
| Total | 17,504) | 19,067) | 15,591) | 12,901) | 13,049) | 13,856) |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
Total assets experienced a period of volatility between 2017 and 2022, characterized by an initial decline, a significant surge peaking in 2021, and a subsequent contraction. The total asset base moved from 13.86 billion US$ in January 2017 to a peak of 19.07 billion US$ in January 2021, before settling at 17.50 billion US$ by January 2022.
- Domestic Segment Asset Performance
- The domestic segment serves as the primary driver of the company's asset base. After a decrease from 12.50 billion US$ in 2017 to 11.55 billion US$ in 2018, domestic assets underwent a period of aggressive growth, reaching a peak of 17.63 billion US$ in January 2021. This represents a substantial increase in resource allocation or asset acquisition during the 2020-2021 period, followed by a reduction to 16.02 billion US$ in 2022.
- International Segment Asset Performance
- International assets remained relatively stable in scale but exhibited higher proportional volatility. A significant contraction occurred in February 2019, where assets fell to 993 million US$ from 1.50 billion US$ in the prior year. Following this trough, the segment demonstrated a consistent recovery trend, growing steadily over three years to reach 1.49 billion US$ by January 2022.
- Asset Distribution and Concentration
- Analysis of the segment distribution reveals a heavy concentration of assets within the domestic market. Domestic assets consistently accounted for over 90% of the total asset base throughout the analyzed period. While international assets showed a recovery trend toward the end of the period, the overall corporate asset structure remained overwhelmingly centered on domestic operations.
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Capital expenditures
Best Buy Co. Inc., capital expenditures by reportable segment
US$ in millions
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 691) | 680) | 691) | 770) | 606) | 526) |
| International | 46) | 33) | 52) | 49) | 82) | 56) |
| Total | 737) | 713) | 743) | 819) | 688) | 582) |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
Total capital expenditures experienced a period of growth between 2017 and 2019, followed by a phase of relative stabilization from 2020 through 2022. Aggregate spending rose from 582 million US dollars in 2017 to a peak of 819 million US dollars in 2019, before consolidating within a range of 713 million to 743 million US dollars over the final three years of the analyzed period.
- Domestic Segment Investment
- The domestic segment represents the primary driver of capital allocation. Expenditures increased significantly from 526 million US dollars in 2017 to a high of 770 million US dollars in 2019. Following this peak, spending normalized and remained consistent, fluctuating narrowly between 680 million and 691 million US dollars from 2020 to 2022.
- International Segment Investment
- Capital spending in the international segment was substantially lower and exhibited greater volatility. After reaching a peak of 82 million US dollars in 2018, investment declined, reaching a period low of 33 million US dollars in 2021 before recovering slightly to 46 million US dollars in 2022.
- Segmental Distribution and Concentration
- There is a heavy concentration of capital investment within the domestic market. Throughout the entire period, domestic expenditures consistently accounted for over 90% of the total capital budget, indicating a strategic priority toward maintaining or expanding domestic infrastructure over international growth.
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Depreciation
Best Buy Co. Inc., depreciation by reportable segment
US$ in millions
| Jan 29, 2022 | Jan 30, 2021 | Feb 1, 2020 | Feb 2, 2019 | Feb 3, 2018 | Jan 28, 2017 | |
|---|---|---|---|---|---|---|
| Domestic | 738) | 704) | 681) | 687) | 631) | 613) |
| International | 49) | 55) | 59) | 60) | 52) | 41) |
| Total | 787) | 759) | 740) | 747) | 683) | 654) |
Based on: 10-K (reporting date: 2022-01-29), 10-K (reporting date: 2021-01-30), 10-K (reporting date: 2020-02-01), 10-K (reporting date: 2019-02-02), 10-K (reporting date: 2018-02-03), 10-K (reporting date: 2017-01-28).
Total depreciation expenses exhibited a consistent upward trajectory over the six-year period from 2017 to 2022, increasing from 654 million US dollars to 787 million US dollars. While the overall trend is positive, a marginal contraction occurred in 2020, followed by a resumption of growth through 2022.
- Domestic Segment Trends
- The domestic segment serves as the primary driver of total depreciation, maintaining a steady increase for the majority of the analyzed period. Expenses rose from 613 million US dollars in 2017 to 738 million US dollars in 2022. A slight deviation from this growth pattern was noted in 2020, where expenses dipped marginally to 681 million US dollars from 687 million US dollars in the preceding year, before continuing to climb in 2021 and 2022.
- International Segment Trends
- Depreciation for the international segment followed a non-linear pattern, characterized by an initial expansion followed by a gradual contraction. Expenses grew from 41 million US dollars in 2017 to a peak of 60 million US dollars in 2019. Subsequently, a downward trend emerged, with figures declining to 49 million US dollars by 2022, representing a reversal of the growth observed in the first three years.
- Comparative Segment Analysis
- The disparity between domestic and international depreciation has widened over time. In 2017, domestic depreciation was approximately 14.9 times larger than international depreciation. By 2022, this ratio increased to approximately 15.1 times, reflecting the domestic segment's increasing dominance in the company's overall depreciation profile and a contraction in international capital asset footprints or changes in depreciation schedules abroad.
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