Company: BBY
Filing Date: 2025-12-05
Form Type: 10-Q
Source: 0000764478-25-000057
Chunk: 20

Company: BEST BUY CO INC
Filing Date: 2025-12-05
Form: 10-Q
Item: Part I, Item 1
Chunk 20
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 information on an ongoing basis.(5)Valued using readily observable market inputs. These instruments are custom, over-the-counter contracts with various bank counterparties that are not traded on an active market. See Note 5, Derivative Instruments, for additional information.Nonrecurring Fair Value MeasurementsIn the first six months of fiscal 2026, we recorded asset impairments and other costs as a result of restructuring initiatives that commenced in the first and second quarters of fiscal 2026. Refer to Note 2, Restructuring, for additional information.In the third quarter of fiscal 2026, we recorded goodwill and definite-lived intangible asset impairments related to Best Buy Health. Refer to Note 3, Goodwill and Intangible Assets, for additional information. In addition, we recorded $21 million of long-lived asset impairments related to Best Buy Health, included in SG&A on our Condensed Consolidated Statements of Earnings. The remaining carrying value of net long-lived assets subject to impairment approximates fair value and was immaterial as of November 1, 2025.All nonrecurring fair value remeasurements mentioned above were based on significant unobservable inputs (Level 3).

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Fair Value of Financial InstrumentsThe fair values of cash, certain restricted cash, receivables, accounts payable and other payables approximated their carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Fair values for other investments held at cost are not readily available, but we estimate that the carrying values for these investments approximate their fair values.Long-term debt is presented at carrying value on our Condensed Consolidated Balance Sheets. If our long-term debt were recorded at fair value, it would be classified as Level 2 in the fair value hierarchy. Long-term debt balances were as follows ($ in millions):November 1, 2025February 1, 2025November 2, 2024Fair ValueCarrying ValueFair ValueCarrying ValueFair ValueCarrying ValueLong-term debt(1)$1,076$1,143$1,031$1,136$1,028$1,134(1)Excludes debt discounts, issuance costs and finance lease obligations.

5.     Derivative Instruments

We manage our economic and transaction exposure to certain risks by using foreign exchange forward contracts to hedge against the effect of Canadian dollar exchange rate fluctuations on a portion of our net investment in