Unless the context otherwise requires, the use of the terms “Best Buy,” “we,” “us” and “our” refers to Best Buy Co., Inc. and its consolidated subsidiaries. Any references to our website addresses do not constitute incorporation by reference of the information contained on the websites. Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to provide a reader of our financial statements with a narrative from the perspective of our management on our financial condition, results of operations, liquidity and certain other factors that may affect our future results. Unless otherwise noted, transactions and other factors significantly impacting our financial condition, results of operations and liquidity are discussed in order of magnitude. Our MD&A should be read in conjunction with our Annual Report on Form 10-K for the fiscal year ended January 31, 2026 (including the information presented therein under Risk Factors), as well as our other reports on Forms 10-Q and 8-K and other publicly available information. All amounts herein are unaudited. Overview We are driven by our purpose to enrich lives through technology and our vision to personalize and humanize technology solutions for every stage of life. We accomplish this by leveraging our combination of tech expertise and a human touch to meet our customers’ everyday needs, whether they come to us online, visit our stores or invite us into their homes. We have two reportable segments: Domestic and International. The Domestic segment is comprised of our operations in all states, districts and territories of the U.S. and our Best Buy Health business. The International segment is comprised of all our operations in Canada. Our fiscal year ends on the Saturday nearest the end of January. Unless otherwise noted, references to years within the MD&A section of this report relate to fiscal years, not calendar years. Our business, like that of many retailers, is seasonal. A large proportion of our revenue and earnings is generated in the fiscal fourth quarter, which includes the majority of the holiday shopping season. Comparable Sales Throughout this MD&A, we refer to comparable sales. Comparable sales is a metric used by management to evaluate the performance of our existing stores and digital offerings by measuring the change in net sales for a particular period over the comparable prior period of equivalent length. Comparable sales includes revenue from stores operating for at least 14 full months; sales initiated on a website, app or virtual store; advertising revenue; commercial sales; credit card revenue; gift card breakage; marketplace commission revenue; and sales of merchandise to wholesalers and dealers. Revenue from acquisitions is included in comparable sales beginning with the first full quarter following the first anniversary of the date of the acquisition. Comparable sales excludes revenue from stores closed more than 14 days (including but not limited to relocated, remodeled, expanded and downsized stores, or stores impacted by natural disasters) until at least 14 full months after reopening; the impact of certain periodic warranty-related profit-share revenue; the effect of fluctuations in foreign currency exchange rates (applicable to our International segment only); and the impact of the 53rd week (applicable in 53-week fiscal years only). Comparable sales is based on our fiscal calendar and is not adjusted to align calendar weeks. All periods presented apply this methodology consistently. Comparable online sales is a subset of comparable sales related to our digital offerings and includes sales initiated on a website, app or virtual store; advertising revenue and marketplace commission revenue. We believe comparable sales is a meaningful supplemental metric for investors to evaluate revenue performance resulting from growth in existing stores and digital offerings versus the portion resulting from opening new stores or closing existing stores. The method of calculating comparable sales varies across the retail industry. As a result, our method of calculating comparable sales may not be the same as other retailers’ methods. Revenue Category Reclassification Beginning in the first quarter of fiscal 2027, we reclassified certain amounts within our revenue categories to better align with management's current view of the business. The reclassification primarily relates to credit card revenue and digital content revenue (including digital gaming, software and subscriptions) that were previously included in various product revenue categories and, following the reclassification, are now included within services revenue. The reclassification impacts only the presentation of revenue by category and does not affect previously reported total revenue, total comparable sales, net earnings or cash flows. Revenue mix and comparable sales by revenue category for the three months ended May 3, 2025, have been recast to conform with this reclassification. 16 Table of Contents The key components of each revenue category are now as follows: •Computing and Mobile Phones - computing (including desktops, notebooks and peripherals), mobile phones (including related mobile network carrier commissions), networking, tablets (including e-readers) and wearables (including smartwatches); •Consumer Electronics - digital imaging, health and fitness products, home theater (including accessories, soundbars and televisions), portable audio (including headphones and portable speakers) and smart home; •Appliances - large appliances (including dishwashers, laundry, ovens and refrigerators) and small appliances (including blenders, coffee makers, vacuums and personal care); •Entertainment - drones, gaming (including hardware, peripherals and certain software, as well as augmented reality glasses), toys and virtual reality; •Services - advertising, credit card revenue, digital content (including digital gaming, software and subscriptions), fulfillment, health-related services, installation, marketplace commissions, memberships, repair, technical support and warranty-related services; and •Other - other product offerings (including baby, food and beverage and outdoor living). Non-GAAP Financial Measures This MD&A includes financial information prepared in accordance with accounting principles generally accepted in the U.S. (“GAAP”), as well as certain non-GAAP financial measures, such as consolidated adjusted selling, general and administrative expenses ("SG&A"), consolidated adjusted SG&A rate, consolidated adjusted operating income, consolidated adjusted operating income rate, consolidated adjusted effective tax rate and consolidated adjusted diluted earnings per share (“EPS”). We believe that non-GAAP financial measures, when reviewed in conjunction with GAAP financial measures, provide additional useful information for evaluating current period performance and assessing future performance. For these reasons, internal management reporting, including budgets, forecasts and financial targets used for short-term incentives are based on non-GAAP financial measures. Generally, our non-GAAP financial measures include adjustments for items such as restructuring charges, goodwill and acquired intangible asset impairments, certain long-lived asset impairments, price-fixing settlements, gains and losses on disposals of subsidiaries and certain investments, amortization of definite-lived intangible assets associated with acquisitions, certain acquisition-related costs and the tax effect of all such items. In addition, certain other items may be excluded from non-GAAP financial measures when we believe doing so provides greater clarity to management and our investors. We provide reconciliations of the most comparable financial measures presented in accordance with GAAP to presented non-GAAP financial measures that enable investors to understand the adjustments made in arriving at the non-GAAP financial measures and to evaluate performance using the same metrics as management. These non-GAAP financial measures should be considered in addition to, and not superior to or as a substitute for, GAAP financial measures. We strongly encourage investors and shareholders to review our financial statements and publicly filed reports in their entirety and not to rely on any single financial measure. Non-GAAP financial measures may be calculated differently from similarly titled measures used by other companies, thereby limiting their usefulness for comparative purposes. In our discussions of the operating results of our consolidated business and our International segment, we sometimes refer to the impact of changes in foreign currency exchange rates or the impact of foreign currency exchange rate fluctuations, which are references to the differences between the foreign currency exchange rates we use to convert the International segment’s operating results from local currencies into U.S. dollars for reporting purposes. We also may use the term “constant currency,” which represents results adjusted to exclude foreign currency impacts. We calculate those impacts as the difference between the current period results translated using the current period currency exchange rates and using the comparable prior period currency exchange rates. We believe the disclosure of revenue changes in constant currency provides useful supplementary information to investors in light of significant fluctuations in currency rates. Refer to the Non-GAAP Financial Measures section below for detailed reconciliations of items impacting consolidated adjusted SG&A, consolidated adjusted operating income, consolidated adjusted effective tax rate and consolidated adjusted diluted EPS in the presented periods. Tariffs We continue to monitor developments with respect to tariffs and other trade policy matters closely, including impacts from the U.S. Supreme Court decision that ruled the tariffs imposed under the International Emergency Economic Powers Act (“IEEPA”) were unauthorized. We are participating in the process established by the U.S. Customs and Border Protection for refunds of tariffs we paid as the importer of record under IEEPA. The timing and amount of refunds ultimately received is subject to ongoing legal and administrative uncertainty. Accordingly, we did not recognize any amounts related to these refunds during the three months ended May 2, 2026. As tariff and trade policy discussions are ongoing and related matters continue to evolve, we cannot predict with certainty their ultimate impact on our business in future periods, including our results of operations and cash flows. For more information on these risks and uncertainties, see Item 1A, Risk Factors, of our most recent Annual Report on Form 10-K. 17 Table of Contents Results of Operations Consolidated Results Selected consolidated financial data was as follows ($ in millions, except per share amounts): Three Months Ended May 2, 2026 May 3, 2025 Revenue $ 8,936 $ 8,767 Revenue % change 1.9 % (0.9) % Comparable sales % change 2.0 % (0.7) % Gross profit $ 2,102 $ 2,049 Gross profit as a % of revenue(1) 23.5 % 23.4 % Selling, general and administrative expense ("SG&A") $ 1,741 $ 1,721 SG&A as a % of revenue(1) 19.5 % 19.6 % Restructuring charges $ (9) $ 109 Operating income $ 370 $ 219 Operating income as a % of revenue 4.1 % 2.5 % Net earnings $ 276 $ 202 Diluted EPS $ 1.31 $ 0.95 (1)Because retailers vary in how they record costs of operating their supply chain between cost of sales and SG&A, our gross profit rate and SG&A rate may not be comparable to other retailers’ corresponding rates. For additional information regarding costs classified in cost of sales and SG&A, refer to Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements included in Item 8, Financial Statements and Supplementary Data, of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026. In the first quarter of fiscal 2027, we generated $8.9 billion in revenue and our comparable sales grew 2.0%, primarily driven by comparable sales growth in gaming, computing and mobile phones, partially offset by a comparable sales decline in major appliances. The comparable sales growth was due to a mix of new technology innovation, our continued focus on omni-channel customer experience and strong vendor partnerships. We recorded a reduction to restructuring charges in the first quarter of fiscal 2027, primarily related to adjustments for termination benefits associated with a labor and store optimization restructuring initiative that commenced in the second quarter of fiscal 2026. Refer to Note 2, Restructuring, of the Notes to Consolidated Financial Statements for additional information. Operating income rate increased in the first quarter of fiscal 2027, primarily due to lower restructuring charges. Diluted EPS increased in the first quarter of fiscal 2027, primarily due to higher operating income. Revenue, gross profit rate, SG&A rate and operating income rate changes in the first quarter of fiscal 2027 were primarily driven by our Domestic segment. For further discussion of our Domestic and International segments, see Segment Performance Summary, below. Store Summary Stores open by segment were as follows: May 2, 2026 May 3, 2025 Best Buy 884 886 Outlet Centers 18 24 Pacific Sales 20 20 Yardbird 2 21 Total Domestic stores 924 951 Canada Best Buy stores 129 128 Canada Best Buy Mobile stand-alone stores 12 29 Total International stores(1) 141 157 Total stores 1,065 1,108 (1)Excludes Best Buy Express stores leased by Bell Canada. 18 Table of Contents We continuously monitor store performance as part of a market-driven, omnichannel strategy. As we approach the expiration of leases, we evaluate various options for each location, including whether a store should remain open. We currently expect to increase our Domestic segment Best Buy store count by an additional four stores by the end of fiscal 2027. Income Tax Expense Income tax expense increased to $102 million in the first quarter of fiscal 2027 compared to $19 million in the first quarter of fiscal 2026, primarily due to the discrete tax impacts of the restructuring charges and the associated exit of a component of our Best Buy Health business in the prior year, as well as higher pre-tax income. Effective tax rate (“ETR”) increased to 26.9% in the first quarter of fiscal 2027 compared to 8.6% in the first quarter of fiscal 2026, primarily due to these prior-year discrete tax impacts. See Note 2, Restructuring, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q for additional information. Our tax provision for interim periods is determined using an estimate of our annual ETR, adjusted for discrete and unusual and infrequent items, if any, that are taken into account in the relevant period. We update our estimate of the annual ETR each quarter, and we make a cumulative adjustment if our estimated tax rate changes. Our quarterly tax provision and our quarterly estimate of our annual ETR are subject to variation due to several factors, including our ability to accurately forecast our pre-tax and taxable income and loss by jurisdiction, tax audit developments, recognition of excess tax benefits or deficiencies related to stock-based compensation, foreign currency gains (losses), changes in laws or regulations, and expenses or losses for which tax benefits are not recognized. Our ETR can be more or less volatile based on the amount of pre-tax earnings. For example, the impact of discrete items and non-deductible losses on our ETR is greater when our pre-tax earnings are lower. Segment Performance Summary Domestic Segment Selected financial data for the Domestic segment was as follows ($ in millions): Three Months Ended May 2, 2026 May 3, 2025 Revenue $ 8,249 $ 8,127 Revenue % change 1.5 % (0.9) % Comparable sales % change(1) 1.8 % (0.7) % Gross profit $ 1,954 $ 1,908 Gross profit as a % of revenue 23.7 % 23.5 % Adjusted SG&A(2) $ 1,596 $ 1,579 Adjusted SG&A as a % of revenue(3) 19.3 % 19.4 % Adjusted operating income(2) $ 358 $ 329 Adjusted operating income as a % of revenue(4) 4.3 % 4.0 % Selected Online Revenue Data Total online revenue $ 2,616 $ 2,579 Online revenue as a % of total segment revenue 31.7 % 31.7 % Comparable online sales % change(1) 1.4 % 2.1 % (1)Comparable online sales are included in the comparable sales calculation. (2)Represents segment Adjusted SG&A and segment Adjusted operating income in accordance with Accounting Standards Codification ("ASC") 280, Segment Reporting. (3)Adjusted SG&A as a % of revenue is calculated as Domestic segment Adjusted SG&A divided by Domestic segment Revenue. (4)Adjusted operating income as a % of revenue is calculated as Domestic segment Adjusted operating income divided by Domestic segment Revenue. Domestic segment revenue increased in the first quarter of fiscal 2027, primarily driven by comparable sales growth in gaming, computing, mobile phones and services, partially offset by a comparable sales decline in appliances. Online revenue of $2.6 billion in the first quarter of fiscal 2027 increased 1.4% on a comparable basis. 19 Table of Contents Domestic segment revenue mix percentages and comparable sales percentage changes by revenue category were as follows: Revenue Mix Comparable Sales Three Months Ended Three Months Ended May 2, 2026 May 3, 2025(1) May 2, 2026 May 3, 2025(1) Computing and Mobile Phones 47 % 46 % 4.2 % 6.1 % Consumer Electronics 26 % 27 % (2.7) % (5.2) % Appliances 10 % 12 % (13.6) % (8.0) % Services 10 % 9 % 5.5 % 0.6 % Entertainment 7 % 5 % 38.1 % (15.2) % Other - % 1 % (20.1) % (2.7) % Total 100 % 100 % 1.8 % (0.7) % (1) Revenue mix and comparable sales by revenue category for the three months ended May 3, 2025, have been recast to conform to the current presentation. See Revenue Category Reclassification, above, for additional information. Notable comparable sales changes by revenue category were as follows: •Computing and Mobile Phones: The 4.2% comparable sales growth was driven primarily by computing and mobile phones. •Consumer Electronics: The 2.7% comparable sales decline was driven primarily by home theater, headphones and portable speakers. •Appliances: The 13.6% comparable sales decline was driven primarily by large appliances. •Services: The 5.5% comparable sales growth was driven primarily by Best Buy Marketplace and credit card revenue. •Entertainment: The 38.1% comparable sales growth was driven primarily by gaming. Domestic segment gross profit rate increased in the first quarter of fiscal 2027, primarily due to growth in Best Buy Marketplace and Best Buy Ads, and improved financial performance from our traditional services offerings. These increases were primarily offset by lower product margin rates. Domestic segment adjusted SG&A increased in the first quarter of fiscal 2027, primarily due to higher expenses related to our Best Buy Marketplace and Best Buy Ads initiatives, and lapping a favorable indirect tax settlement received in the first quarter of fiscal 2026. These increases were partially offset by lower Best Buy Health expense. Domestic segment adjusted operating income rate increased in the first quarter of fiscal 2027, primarily due to a favorable gross profit rate. International Segment Selected financial data for the International segment was as follows ($ in millions): Three Months Ended May 2, 2026 May 3, 2025 Revenue $ 687 $ 640 Revenue % change 7.3 % (0.6) % Comparable sales % change 4.7 % (0.7) % Gross profit $ 148 $ 141 Gross profit as a % of revenue 21.5 % 22.0 % Adjusted SG&A(1) $ 143 $ 137 Adjusted SG&A as a % of revenue(2) 20.8 % 21.4 % Adjusted operating income(1) $ 5 $ 4 Adjusted operating income as a % of revenue(3) 0.7 % 0.6 % (1)Represents segment Adjusted SG&A and segment Adjusted operating income in accordance with ASC 280, Segment Reporting. (2)Adjusted SG&A as a % of revenue is calculated as International segment Adjusted SG&A divided by International segment Revenue. (3)Adjusted operating income as a % of revenue is calculated as International segment Adjusted operating income divided by International segment Revenue. 20 Table of Contents International segment revenue increased in the first quarter of fiscal 2027, primarily driven by comparable sales growth of 4.7% and the favorable impact of foreign exchange rates. The comparable sales growth was primarily driven by mobile phones, gaming and digital imaging. International segment revenue mix percentages and comparable sales percentage changes by revenue category were as follows: Revenue Mix Comparable Sales Three Months Ended Three Months Ended May 2, 2026 May 3, 2025 (1) May 2, 2026 May 3, 2025 (1) Computing and Mobile Phones 50 % 50 % 6.4 % 1.7 % Consumer Electronics 26 % 27 % 2.0 % (1.7) % Appliances 8 % 9 % (8.3) % (2.5) % Services 7 % 7 % 2.5 % 9.0 % Entertainment 7 % 6 % 19.2 % (17.9) % Other 2 % 1 % 26.0 % (13.2) % Total 100 % 100 % 4.7 % (0.7) % (1)Revenue mix and comparable sales by revenue category for the three months ended May 3, 2025, have been recast to conform to the current presentation. See Revenue Category Reclassification, above, for additional information. Notable comparable sales changes by revenue category were as follows: •Computing and Mobile Phones: The 6.4% comparable sales growth was driven primarily by mobile phones and computing. •Consumer Electronics: The 2.0% comparable sales growth was driven primarily by digital imaging, partially offset by a comparable sales decline in home theater. •Appliances: The 8.3% comparable sales decline was driven primarily by large appliances. •Services: The 2.5% comparable sales growth was driven primarily by growth in marketplace and our membership programs, partially offset by a comparable sales decline in digital content. •Entertainment: The 19.2% comparable sales growth was driven primarily by gaming. International segment gross profit rate decreased in the first quarter of fiscal 2027, primarily due to lower product margin rates. International segment adjusted SG&A increased in the first quarter of fiscal 2027, primarily due to the negative impact of foreign exchange rates and higher depreciation expense. International segment adjusted operating income rate increased in the first quarter of fiscal 2027, primarily due to increased leverage from higher sales volumes, which resulted in a favorable adjusted SG&A rate, largely offset by an unfavorable gross profit rate. 21 Table of Contents Non-GAAP Financial Measures Reconciliations of consolidated SG&A, consolidated operating income, consolidated effective tax rate and consolidated diluted EPS (GAAP financial measures) to consolidated adjusted SG&A, consolidated adjusted operating income, consolidated adjusted effective tax rate and consolidated adjusted diluted EPS (non-GAAP financial measures), respectively, were as follows ($ in millions, except per share amounts): Three Months Ended May 2, 2026 May 3, 2025 SG&A $ 1,741 $ 1,721 % of revenue 19.5 % 19.6 % Intangible asset amortization(1) (2) (5) Adjusted SG&A $ 1,739 $ 1,716 % of revenue 19.5 % 19.6 % Operating income $ 370 $ 219 % of revenue 4.1 % 2.5 % Intangible asset amortization(1) 2 5 Restructuring charges(2) (9) 109 Adjusted operating income $ 363 $ 333 % of revenue 4.1 % 3.8 % Effective tax rate 26.9 % 8.6 % Intangible asset amortization(1) - % 0.3 % Restructuring charges(2) 0.1 % 18.1 % Adjusted effective tax rate 27.0 % 27.0 % Diluted EPS $ 1.31 $ 0.95 Intangible asset amortization(1) 0.01 0.02 Restructuring charges(2) (0.05) 0.51 Income tax impact of non-GAAP adjustments(3) 0.01 (0.33) Adjusted diluted EPS $ 1.28 $ 1.15 For additional information regarding the nature of certain charges discussed below, refer to Note 2, Restructuring, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q. (1)Represents the non-cash amortization of definite-lived intangible assets associated with acquisitions, including customer relationships and tradenames. (2)Amounts for the three months ended May 2, 2026, primarily related to subsequent adjustments to a labor and store optimization restructuring initiative that commenced in the second quarter of fiscal 2026. Charges for the three months ended May 3, 2025, primarily related to a restructuring initiative within our Best Buy Health business that commenced in the first quarter of fiscal 2026. (3)The non-GAAP adjustments primarily relate to the U.S. As such, the forecasted annual income tax on the U.S. non-GAAP adjustments is calculated using the statutory tax rate of 24.5%, adjusted for tax benefits discrete to the period. Liquidity and Capital Resources We closely manage our liquidity and capital resources. Our liquidity requirements depend on key variables, including the level of investment required to support our business strategies, the performance of our business, capital expenditures, dividends, credit facilities, short-term borrowing arrangements and working capital management. We modify our approach to managing these variables as changes in our operating environment arise. For example, capital expenditures and share repurchases are a component of our cash flow and capital management strategy, which, to a large extent, we can adjust in response to economic and other changes in our business environment. Cash and cash equivalents were as follows ($ in millions): May 2, 2026 January 31, 2026 May 3, 2025 Cash and cash equivalents $ 1,749 $ 1,738 $ 1,147 The increases in cash and cash equivalents from January 31, 2026, and May 3, 2025, were primarily due to positive operating cash flows from earnings, partially offset by dividend payments and capital expenditures. 22 Table of Contents Cash Flows Cash flows were as follows ($ in millions): Three Months Ended May 2, 2026 May 3, 2025 Total cash provided by (used in): Operating activities $ 375 $ 34 Investing activities (160) (166) Financing activities (202) (305) Effect of exchange rate changes on cash and cash equivalents - 4 Increase (decrease) in cash, cash equivalents and restricted cash $ 13 $ (433) Operating Activities The increase in cash provided by operating activities in the first quarter of fiscal 2027 was primarily driven by higher cash outflows from accounts payable in the prior year due to the timing and volume of inventory purchases and payments. Investing Activities The decrease in cash used in investing activities in the first quarter of fiscal 2027 was primarily driven by lower capital expenditures. Financing Activities The decrease in cash used in financing activities in the first quarter of fiscal 2027 was primarily driven by lower share repurchases. Sources of Liquidity Funds generated by operating activities, available cash and cash equivalents, our credit facilities, other debt arrangements and trade payables are our most significant sources of liquidity. We believe our sources of liquidity will be sufficient to fund operations and anticipated capital expenditures, share repurchases, dividends and strategic initiatives, including business combinations. However, in the event our liquidity is insufficient, we may be required to limit our spending. There can be no assurance that we will continue to generate cash flows at or above current levels or that we will be able to maintain our ability to borrow under our existing credit facilities or obtain additional financing, if necessary, on favorable terms. We have a $1.25 billion five-year senior unsecured revolving credit facility agreement (the “Five-Year Facility Agreement”) with a syndicate of banks that expires in April 2030. There were no borrowings outstanding under the Five-Year Facility Agreement as of May 2, 2026, January 31, 2026, or May 3, 2025. Restricted Cash Our liquidity is also affected by restricted cash balances that are primarily restricted to cover product protection plans provided under our membership offerings and self-insurance liabilities. Restricted cash, which is included in Other current assets on our Condensed Consolidated Balance Sheets, remained relatively consistent at $287 million, $285 million and $288 million as of May 2, 2026, January 31, 2026, and May 3, 2025, respectively. Debt and Capital As of May 2, 2026, we had $500 million of principal amount of notes due October 1, 2028, and $650 million of principal amount of notes due October 1, 2030. Refer to Note 6, Debt, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q, and Note 7, Debt, of the Notes to Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, for additional information about our outstanding debt. 23 Table of Contents Share Repurchases and Dividends We repurchase our common stock and pay dividends pursuant to programs approved by our Board of Directors (“Board”). The payment of cash dividends is also subject to customary legal and contractual restrictions. Our long-term capital allocation strategy is to first fund operations and investments in growth and then return excess cash over time to shareholders through dividends and share repurchases while maintaining investment-grade credit metrics. Our share repurchase plans are evaluated on an ongoing basis, considering factors such as our financial condition and cash flows, our economic outlook, the impact of tax laws, our liquidity needs, our stock price, and the health and stability of global markets. The timing and amount of future repurchases may vary depending on such factors. On February 28, 2022, our Board approved a $5.0 billion share repurchase program. There is no expiration date governing the period over which we can repurchase shares under this authorization. Share repurchase and dividend activity were as follows ($ and shares in millions, except per share amounts): Three Months Ended May 2, 2026 May 3, 2025 Total cost of shares repurchased $ - $ 100 Average price per share $ - $ 64.39 Total number of shares repurchased - 1.6 Regular quarterly cash dividend per share $ 0.96 $ 0.95 Cash dividends declared and paid $ 202 $ 202 There were no shares repurchased in the first quarter of fiscal 2027. Cash dividends declared and paid remained effectively unchanged in the first quarter of fiscal 2027, as the increase in the regular quarterly cash dividend per share was offset by fewer shares outstanding. Off-Balance-Sheet Arrangements and Contractual Obligations Our liquidity is not dependent on the use of off-balance-sheet financing arrangements other than in connection with our $1.25 billion in undrawn capacity on our Five-Year Facility Agreement as of May 2, 2026, which, if drawn upon, would be included in either short-term or long-term debt on our Condensed Consolidated Balance Sheets. There has been no material change in our contractual obligations other than in the ordinary course of business since the end of fiscal 2026. See our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, for additional information regarding our off-balance-sheet arrangements and contractual obligations. Significant Accounting Policies and Estimates We describe our significant accounting policies in Note 1, Summary of Significant Accounting Policies, of the Notes to Consolidated Financial Statements, and our critical accounting estimates in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026. There have been no significant changes in our significant accounting policies or critical accounting estimates since the end of fiscal 2026. New or Recently Issued Accounting Pronouncements For a description of applicable new or recently issued accounting pronouncements, including our assessment of the impact on our financial statements, see Note 1, Basis of Presentation, of the Notes to Condensed Consolidated Financial Statements, included in this Quarterly Report on Form 10-Q. 24 Table of Contents Safe Harbor Statement Under the Private Securities Litigation Reform Act Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”), provide a “safe harbor” for forward-looking statements to encourage companies to provide prospective information about their companies. With the exception of historical information, the matters discussed in this Quarterly Report on Form 10-Q are forward-looking statements and may be identified by the use of words such as “anticipate,” “appear,” “approximate,” “assume,” “believe,” “continue,” “could,” “estimate,” “expect,” “foresee,” “guidance,” “intend,” “may,” “might,” “outlook,” “plan,” “possible,” “project,” “seek,” “should,” “would,” and other words and terms of similar meaning or the negatives thereof. Such statements reflect our current views and estimates with respect to future market conditions, company performance and financial results, operational investments, business prospects, our operating model, new strategies and growth initiatives, the competitive environment, consumer behavior and other events. These statements involve a number of judgments and are subject to certain risks and uncertainties, many of which are outside the control of the Company, that could cause actual results to differ materially from the potential results discussed in such forward-looking statements. Readers should review Item 1A, Risk Factors, of our most recent Annual Report on Form 10-K, and any updated information in subsequent Quarterly Reports on Form 10-Q, for a description of important factors that could cause our actual results to differ materially from those contemplated by the forward-looking statements made in this Quarterly Report on Form 10-Q. Among the factors that could cause actual results and outcomes to differ materially from those contained in such forward-looking statements are the following: macroeconomic pressures in the markets in which we operate (including but not limited to real GDP growth, inflation, recession, consumer confidence, employment levels, effects of the government closures, cost of living, uncertainty over the availability of government benefits, tax rates, availability of consumer financing, interest rates, housing market conditions, foreign currency exchange rates, the price of oil, gas and other commodities and other macroeconomic trends); geopolitical pressures (including issues related to trade routes, political instability and divisiveness, the potential implementation of more restrictive trade policies, tariff increases and/or volatility, the realignment of alliances or the renegotiation of existing trade agreements); catastrophic events, health crises and pandemics; susceptibility of the products we sell to technological advancements, product life cycle fluctuations and changes in consumer preferences; competition (including from multi-channel retailers, e-commerce business, technology service providers, traditional store-based retailers, vendors and mobile network carriers, in the provision of delivery speed and options and with the strategic use of artificial intelligence); our ability to attract and retain qualified employees and changes in market compensation rates; our focus on services as a strategic priority; our reliance on key vendors and mobile network carriers (including product availability); our ability to maintain positive brand perception and recognition; our ability to effectively identify, manage and execute enterprise-wide strategies, such as strategic ventures, alliances or acquisitions; our ability to effectively manage our infrastructure, real estate portfolio and market segmentation strategy; interruptions and other factors affecting our supply chain (impacting our stores or other aspects of our operations); our utilization of third-party vendors for certain aspects of our operations; risks associated with the products we sell, including those products sold on our Marketplace platforms and products under our exclusive brand labels; our reliance on our information technology systems, internet and telecommunications access and capabilities; our ability to prevent or effectively respond to a cyber-attack, privacy or security breach; statutory, regulatory and legal developments (including statutes and/or regulations related to tax or privacy); evolving corporate governance and public disclosure regulations and expectations (including, but not limited to, cybersecurity and corporate responsibility and sustainability matters); risks arising from our international activities (including fluctuations in foreign currency exchange rates); failure to meet any financial performance guidance or other forward-looking statements; failure to effectively manage our costs; our dependence on cash flows and net earnings generated during the fourth fiscal quarter; economic or regulatory developments that might affect our ability to provide attractive promotional financing; constraints in the banking and capital markets; and changes in our credit ratings. We caution that the foregoing list of important factors is not complete. Any forward-looking statements speak only as of the date they are made and we assume no obligation to update any forward-looking statement that we may make.