Fair Value Measurements
 3 Months Ended
May 05, 2018
Fair Value, Assets, Liabilities and Stockholders' Equity Measured on Recurring Basis [Abstract]  
Fair Value Measurements
Fair Value Measurements
The following table provides a summary of the principal value and estimated fair value of long-term debt, excluding Foreign Facility borrowings, as of May 5, 2018, February 3, 2018 and April 29, 2017:
 
May 5,
2018
 
February 3,
2018
 
April 29,
2017
 
(in millions)
Principal Value
$
5,750

 
$
5,750

 
$
5,750

Fair Value (a)
5,735

 
5,943

 
5,992

  _______________
(a)
The estimated fair value of the Company’s publicly traded debt is based on reported transaction prices which are considered Level 2 inputs in accordance with ASC 820, Fair Value Measurement. The estimates presented are not necessarily indicative of the amounts that the Company could realize in a current market exchange.
The authoritative guidance included in ASC 820 establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:
•
Level 1 – Quoted market prices in active markets for identical assets or liabilities.
•
Level 2 – Observable inputs other than quoted market prices included in Level 1, such as quoted prices of similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
•
Level 3 – Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.
The following table provides a summary of assets and liabilities measured in the consolidated financial statements at fair value on a recurring basis as of May 5, 2018, February 3, 2018 and April 29, 2017:
 
Level 1
 
Level 2
 
Level 3
 
Total
 
(in millions)
As of May 5, 2018
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
Cash and Cash Equivalents
$
1,032

 
$
—

 
$
—

 
$
1,032

Marketable Securities
17

 
—

 
—

 
17

Foreign Currency Cash Flow Hedges
—

 
1

 
—

 
1

Liabilities:
 
 
 
 
 
 
 
Foreign Currency Cash Flow Hedges
—

 
2

 
—

 
2

As of February 3, 2018
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
Cash and Cash Equivalents
$
1,515

 
$
—

 
$
—

 
$
1,515

Marketable Securities
17

 
—

 
—

 
17

Liabilities:
 
 
 
 
 
 
 
Foreign Currency Cash Flow Hedges
—

 
9

 
—

 
9

As of April 29, 2017
 
 
 
 
 
 
 
Assets:
 
 
 
 
 
 
 
Cash and Cash Equivalents
$
1,555

 
$
—

 
$
—

 
$
1,555

Marketable Securities
5

 
—

 
—

 
5

Interest Rate Fair Value Hedges
—

 
2

 
—

 
2

Foreign Currency Cash Flow Hedges
—

 
27

 
—

 
27

Liabilities:
 
 
 
 
 
 
 
Foreign Currency Cash Flow Hedges
—

 
1

 
—

 
1



The Company's Level 1 fair value measurements use unadjusted quoted prices in active markets for identical assets. The Company's marketable securities are classified as Level 1 fair value measurements as they are traded with sufficient frequency and volume to enable the Company to obtain pricing information on an ongoing basis.

In January 2016, the FASB issued ASC 321, Investments - Equity Securities. The standard requires the recognition of changes in the fair value of the Company's marketable securities in net income as compared to historical treatment in accumulated other comprehensive income. The Company adopted the standard in the first quarter of 2018. The Company recognized an unrealized holding loss of less than $1 million related to its marketable equity securities in Other Income in the first quarter of 2018 Consolidated Statement of Income.
The Company’s Level 2 fair value measurements use market approach valuation techniques. The primary inputs to these techniques include benchmark interest rates and foreign currency exchange rates, as applicable to the underlying instruments.
Management believes that the carrying values of accounts receivable, accounts payable, accrued expenses and current debt approximate fair value because of their short maturity.