Item 16. Form 10-K Summary

Not applicable.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

												THE TJX COMPANIES, INC.
																		/s/ JOHN KLINGER
Dated:			March 29, 2023															John Klinger, Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the date indicated.

/s/ ERNIE HERRMAN						/s/ JOHN KLINGER
Ernie Herrman, Chief Executive Officer, President and Director (Principal Executive Officer)						John Klinger, Chief Financial Officer (Principal Financial and Accounting Officer)
JOSÉ B. ALVAREZ*						MICHAEL F. HINES*
José B. Alvarez, Director						Michael F. Hines, Director
ALAN M. BENNETT*						AMY B. LANE*
Alan M. Bennett, Director						Amy B. Lane, Director
ROSEMARY T. BERKERY*						CAROL MEYROWITZ*
Rosemary T. Berkery, Director						Carol Meyrowitz, Executive Chairman of the Board of Directors
DAVID T. CHING*						JACKWYN L. NEMEROV*
David T. Ching, Director						Jackwyn L. Nemerov, Director
C. KIM GOODWIN*
C. Kim Goodwin, Director

						*BY			/s/ JOHN KLINGER
Dated:			March 29, 2023						John Klinger, as attorney-in-fact

The TJX Companies, Inc.

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

For Fiscal Years Ended January 28, 2023, January 29, 2022 and January 30, 2021.

Report of Independent Registered Public Accounting Firm (PCAOB ID 238)			F-2
Consolidated Financial Statements:
Consolidated Statements of Income			F-4
Consolidated Statements of Comprehensive Income			F-5
Consolidated Balance Sheets			F-6
Consolidated Statements of Cash Flows			F-7
Consolidated Statements of Shareholders’ Equity			F-8
Notes to Consolidated Financial Statements			F-9
Financial Statement Schedules:
Schedule II – Valuation and Qualifying Accounts			40

F-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders of The TJX Companies, Inc.

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of The TJX Companies, Inc. and its subsidiaries (the “Company”) as of January 28, 2023 and January 29, 2022 and the related consolidated statements of income, of comprehensive income, of shareholders' equity and of cash flows for each of the three years in the period ended January 28, 2023 including the related notes and schedule of valuation and qualifying accounts for each of the three years in the period ended January 28, 2023 appearing under Item 15(a) (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of January 28, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of January 28, 2023 and January 29, 2022, and the results of its operations and its cash flows for each of the three years in the period ended January 28, 2023 in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of January 28, 2023 based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control Over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

F-2

Critical Audit Matters

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Income Tax Provision (Benefit)

As described in Note K to the consolidated financial statements, the Company recorded a provision for income taxes of $1.1 billion for the year ended January 28, 2023, has a deferred tax asset net of deferred tax liability of $31 million, including a valuation allowance of $86 million, as of January 28, 2023 and total gross unrecognized tax benefits of $266 million as of January 28, 2023, of which $251 million would affect the Company’s effective tax rate if recognized in a future period. The Company is subject to taxation in the United States, as well as multiple state, local and foreign jurisdictions. The use of estimates and judgments, as well as the interpretation and application of complex tax laws is required by management to determine its provision (benefit) for income taxes.

The principal considerations for our determination that performing procedures relating to the provision (benefit) for income taxes is a critical audit matter are the (i) the significant judgment by management when determining the provision (benefit) for income taxes, which led to (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures relating to the provision (benefit) for income taxes.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the provision (benefit) for income taxes. These procedures also included, among others (i) testing the provision (benefit) for income taxes, including the rate reconciliation and current and deferred tax provision (benefit), and (ii) evaluating the completeness of uncertain tax positions, including application of foreign and domestic tax laws and regulations.

/s/ PricewaterhouseCoopers LLP

Boston, Massachusetts

March 29, 2023

We have served as the Company’s auditor since 1962.

F-3

THE TJX COMPANIES, INC.

CONSOLIDATED STATEMENTS OF INCOME

IN MILLIONS EXCEPT PER SHARE AMOUNTS

			Fiscal Year Ended
			January 28, 2023			January 29, 2022			January 30, 2021
Net sales			$	49,936		$	48,550		$	32,137
Cost of sales, including buying and occupancy costs			36,149			34,714			24,534
Selling, general and administrative expenses			8,927			9,081			7,021
Impairment on equity investment			218			—			—
Loss on early extinguishment of debt			—			242			312
Interest expense, net			6			115			181
Income before income taxes			4,636			4,398			89
Provision (benefit) for income taxes			1,138			1,115			(1)
Net income			$	3,498		$	3,283		$	90
Basic earnings per share			$	3.00		$	2.74		$	0.08
Weighted average common shares – basic			1,166			1,200			1,200
Diluted earnings per share			$	2.97		$	2.70		$	0.07
Weighted average common shares – diluted			1,178			1,216			1,215

The accompanying notes are an integral part of the consolidated financial statements.

F-4

THE TJX COMPANIES, INC.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

IN MILLIONS

			Fiscal Year Ended
			January 28, 2023			January 29, 2022			January 30, 2021
Net income			$	3,498		$	3,283		$	90
Additions to other comprehensive income (loss):
Foreign currency translation adjustments, net of related tax benefit of $7 and tax provisions of $0 and $2 in fiscal 2023, 2022 and 2021, respectively			(56)			(45)			14
Recognition of net gains/losses on benefit obligations, net of related tax provision of $41 in fiscal 2023, tax benefit of $18 in fiscal 2022 and tax provision of $10 in fiscal 2021			121			(48)			31
Reclassifications from other comprehensive (loss) to net income:
Amortization of loss on cash flow hedge, net of related tax provisions of $1 and $0 in fiscal 2022 and 2021, respectively			—			0			1
Amortization of prior service cost and deferred gains/losses, net of related tax provisions of $6, $5 and $7 in fiscal 2023, 2022 and 2021, respectively			16			13			20
Other comprehensive income (loss), net of tax			81			(80)			66
Total comprehensive income			$	3,579		$	3,203		$	156

The accompanying notes are an integral part of the consolidated financial statements.

F-5

THE TJX COMPANIES, INC.

CONSOLIDATED BALANCE SHEETS

IN MILLIONS EXCEPT SHARE AMOUNTS

			Fiscal Year Ended
			January 28, 2023			January 29, 2022
Assets
Current assets:
Cash and cash equivalents			$	5,477		$	6,227
Accounts receivable, net			563			518
Merchandise inventories			5,819			5,962
Prepaid expenses and other current assets			478			437
Federal, state and foreign income taxes recoverable			119			115
Total current assets			12,456			13,259
Net property at cost			5,783			5,271
Non-current deferred income taxes, net			158			185
Operating lease right of use assets			9,086			8,854
Goodwill			97			97
Other assets			769			795
Total assets			$	28,349		$	28,461
Liabilities
Current liabilities:
Accounts payable			$	3,794		$	4,465
Accrued expenses and other current liabilities			4,346			4,245
Current portion of operating lease liabilities			1,610			1,577
Current portion of long-term debt			500			—
Federal, state and foreign income taxes payable			55			181
Total current liabilities			10,305			10,468
Other long-term liabilities			919			1,015
Non-current deferred income taxes, net			127			44
Long-term operating lease liabilities			7,775			7,576
Long-term debt			2,859			3,355
Commitments and contingencies (See Note N)
Shareholders’ equity
Preferred stock, authorized 5,000,000 shares, par value $1, no shares issued			—			—
Common stock, authorized 1,800,000,000 shares, par value $1, issued and outstanding 1,155,437,908 and 1,181,188,731 shares, respectively			1,155			1,181
Additional paid-in capital			—			—
Accumulated other comprehensive (loss) income			(606)			(687)
Retained earnings			5,815			5,509
Total shareholders’ equity			6,364			6,003
Total liabilities and shareholders’ equity			$	28,349		$	28,461

The accompanying notes are an integral part of the consolidated financial statements.

F-6

THE TJX COMPANIES, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

IN MILLIONS

			Fiscal Year Ended
			January 28, 2023			January 29, 2022			January 30, 2021
Cash flows from operating activities:
Net income			$	3,498		$	3,283		$	90
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			887			868			871
Impairment on equity investment			218			—			—
Loss on early extinguishment of debt			—			242			312
Loss on property disposals and impairment charges			23			9			84
Deferred income tax provision (benefit)			64			(44)			(231)
Share-based compensation			122			189			59
Changes in assets and liabilities:
(Increase) in accounts receivable			(51)			(61)			(71)
Decrease (increase) in merchandise inventories			58			(1,658)			589
(Increase) decrease in income taxes recoverable			(5)			(78)			11
(Increase) decrease in prepaid expenses and other current assets			(73)			33			(57)
(Decrease) increase in accounts payable			(600)			(338)			2,111
(Decrease) increase in accrued expenses and other liabilities			(23)			659			585
(Decrease) increase in income taxes payable			(126)			100			53
(Decrease) increase in net operating lease liabilities			(1)			(129)			200
Other, net			93			(18)			(44)
Net cash provided by operating activities			4,084			3,057			4,562
Cash flows from investing activities:
Property additions			(1,457)			(1,045)			(568)
Purchases of investments			(31)			(22)			(29)
Sales and maturities of investments			18			21			18
Net cash (used in) investing activities			(1,470)			(1,046)			(579)
Cash flows from financing activities:
Payments for repurchase of common stock			(2,255)			(2,176)			(202)
Proceeds from issuance of common stock			321			229			211
Cash dividends paid			(1,339)			(1,252)			(278)
Payments on revolving credit facilities			—			—			(1,000)
Proceeds from long-term debt including revolving credit facilities			—			—			5,987
Payments of long-term debt and extinguishment expenses			—			(2,976)			(1,418)
Other			(33)			(25)			(72)
Net cash (used in) provided by financing activities			(3,306)			(6,200)			3,228
Effect of exchange rate changes on cash			(58)			(54)			42
Net (decrease) increase in cash and cash equivalents			(750)			(4,243)			7,253
Cash and cash equivalents at beginning of year			6,227			10,470			3,217
Cash and cash equivalents at end of year			$	5,477		$	6,227		$	10,470

The accompanying notes are an integral part of the consolidated financial statements.

F-7

THE TJX COMPANIES, INC.

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

IN MILLIONS

			Common Stock						Additional Paid-In Capital			Accumulated Other Comprehensive (Loss) Income			Retained Earnings			Total
			Shares			Par Value $1
Balance, February 1, 2020			1,199			$	1,199		$	—		$	(673)		$	5,422		$	5,948
Net income			—			—			—			—			90			90
Other comprehensive income, net of tax			—			—			—			66			—			66
Cash dividends declared on common stock			—			—			—			—			(312)			(312)
Recognition (reversal) of share-based compensation			—			—			113			—			(54)			59
Issuance of common stock under stock incentive plan and related tax effect			9			9			175			—			0			184
Common stock repurchased			(3)			(3)			(27)			—			(172)			(202)
Balance, January 30, 2021			1,205			$	1,205		$	261		$	(607)		$	4,974		$	5,833
Net income			—			—			—			—			3,283			3,283
Other comprehensive (loss), net of tax			—			—			—			(80)			—			(80)
Cash dividends declared on common stock			—			—			—			—			(1,249)			(1,249)
Recognition of share-based compensation			—			—			189			—			—			189
Issuance of common stock under stock incentive plan and related tax effect			7			7			196			—			0			203
Common stock repurchased			(31)			(31)			(646)			—			(1,499)			(2,176)
Balance, January 29, 2022			1,181			$	1,181		$	—		$	(687)		$	5,509		$	6,003
Net income			—			—			—			—			3,498			3,498
Other comprehensive income, net of tax			—			—			—			81			—			81
Cash dividends declared on common stock			—			—			—			—			(1,373)			(1,373)
Recognition of share-based compensation			—			—			122			—			—			122
Issuance of common stock under stock incentive plan and related tax effect			9			9			279			—			—			288
Common stock repurchased			(35)			(35)			(401)			—			(1,819)			(2,255)
Balance, January 28, 2023			1,155			$	1,155		$	—		$	(606)		$	5,815		$	6,364

The accompanying notes are an integral part of the consolidated financial statements.

F-8

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note A. Basis of Presentation and Summary of Accounting Policies

Basis of Presentation

The Consolidated Financial Statements and Notes thereto of The TJX Companies, Inc. (referred to as “TJX,” “we” or “the Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and include the consolidated financial statements of all of TJX’s subsidiaries, all of which are wholly owned. All of the Company's activities are conducted by TJX or its subsidiaries and are consolidated in these consolidated financial statements. All intercompany transactions have been eliminated in consolidation.

Fiscal Year

TJX’s fiscal year ends on the Saturday nearest to the last day of January of each year. The fiscal years ended January 28, 2023 (“fiscal 2023”), January 29, 2022 (“fiscal 2022”) and January 30, 2021 (“fiscal 2021”) were 52-week fiscal years. Fiscal 2024 will be a 53-week fiscal year and will end February 3, 2024.

Use of Estimates

The preparation of financial statements, in conformity with GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements as well as the reported amounts of revenues and expenses during the reporting period. TJX considers its accounting policies relating to inventory valuation, reserves for uncertain tax positions and loss contingencies to be the most significant accounting policies that involve management estimates and judgments. Actual amounts could differ from these estimates, and such differences could be material.

Summary of Accounting Policies

Revenue Recognition

Net Sales

Net sales consist primarily of merchandise sales, which are recorded net of a reserve for estimated returns, any discounts and sales taxes, for the sales of merchandise both within our stores and online. Net sales also include an immaterial amount of other revenues that represent less than 1% of total revenues, primarily generated from shipping fee revenue on our online sales. In addition, certain customers, primarily Associates, may receive discounts that are accounted for as consideration reducing the transaction price. Merchandise sales from our stores are recognized at the point of sale when TJX provides the merchandise to the customer. The performance obligation is fulfilled at this point when the customer has obtained control by paying for and leaving with the merchandise. Merchandise sales made online are recognized when the product has been shipped, which is when legal title has passed and when TJX is entitled to payment, and the customer has obtained the ability to direct the use of and obtain substantially all of the remaining benefits from the goods. Shipping and handling activities related to online sales occur after the customer obtains control of the goods. TJX’s policy is to treat shipping costs as part of our fulfillment center costs within our operating expenditures. As a result, shipping fee revenues received are recognized when control of the goods transfer to the customer and are recorded as net sales. Shipping and handling costs incurred by TJX are included in cost of sales, including buying and occupancy costs. TJX disaggregates revenue by operating segment, see Note G—Segment Information.

Deferred Gift Card Revenue

Proceeds from the sale of gift cards as well as the value of store cards issued to customers as a result of a return or exchange are deferred until the customers use the cards to acquire merchandise, as TJX does not fulfill its performance obligation until the gift card has been redeemed. While gift cards have an indefinite life, substantially all are redeemed in the first year of issuance.

The following table presents deferred gift card revenue activity:

In millions			January 28, 2023			January 29, 2022
Balance, beginning of year			$	685		$	576
Deferred revenue			1,927			1,832
Effect of exchange rates changes on deferred revenue			(5)			(2)
Revenue recognized			(1,886)			(1,721)
Balance, end of year			$	721		$	685

F-9

TJX recognized $1.9 billion in gift card revenue in fiscal 2023 and $1.7 billion in fiscal 2022 and $1.1 billion in fiscal 2021. Gift cards are combined in one homogeneous pool and are not separately identifiable. As such, the revenue recognized consists of gift cards that were part of the deferred revenue balance at the beginning of the period as well as gift cards that were issued during the period. Based on historical experience, the Company estimates the amount of gift cards and store cards that will not be redeemed (referred to as breakage) and, to the extent allowed by local law, these amounts are amortized into income over the estimated redemption period. Revenue recognized from breakage was $44 million in fiscal 2023, $21 million in fiscal 2022 and $14 million in fiscal 2021.

Sales Return Reserve

The Company's products are generally sold with a right of return and the Company may provide other credits or incentives, which are accounted for as variable consideration when estimating the amount of revenue to recognize. The Company has elected to apply the portfolio practical expedient. The Company estimates the variable consideration using the expected value method when calculating the returns reserve because the difference in applying it to the individual contract would not differ materially. Returns are estimated based on historical experience and are required to be established and presented at the gross sales value with an asset established for the estimated value of the merchandise returned separately from the refund liability. Liabilities for return allowances are included in “Accrued expenses and other current liabilities” and the estimated value of the merchandise to be returned is included in “Prepaid expenses and other current assets” on the Company’s Consolidated Balance Sheets.

Consolidated Statements of Income Classifications

Cost of sales, including buying and occupancy costs, includes the cost of merchandise sold including foreign currency gains and losses on merchandise purchases denominated in other currencies; gains and losses on inventory and fuel-related derivative contracts; asset retirement obligation costs; divisional occupancy costs (including real estate taxes, utility and maintenance costs and fixed asset depreciation); the costs of operating distribution centers; payroll, benefits and travel costs directly associated with buying inventory; and systems costs related to the buying and tracking of inventory.

Selling, general and administrative expenses include store payroll and benefit costs; communication costs; credit and check expenses; advertising; administrative and field management payroll, benefits and travel costs; corporate administrative costs and depreciation; gains and losses on non-inventory related foreign currency exchange contracts; and other miscellaneous income and expense items.

Cash and Cash Equivalents

TJX generally considers highly liquid investments with a maturity of 90 days or less at the date of purchase to be cash equivalents. If applicable, investments with maturities greater than 90 days but less than one year at the date of purchase are included in short-term investments. These investments are classified as trading securities and are stated at fair value. Investments are classified as either short-term or long-term based on their original maturities. TJX’s investments are primarily high-grade commercial paper, institutional money market funds and time deposits with major banks.

As of January 28, 2023, TJX’s cash and cash equivalents held outside the U.S. were $1.2 billion, of which $0.7 billion was held in countries where TJX has the intention to reinvest any undistributed earnings indefinitely.

Merchandise Inventories

Inventories are stated at the lower of cost or market. TJX uses the retail method for valuing inventories at all of its businesses, except T.K. Maxx in Australia which is immaterial. The businesses that utilize the retail method have some inventory that is initially valued at cost before the retail method is applied as that inventory has not been fully processed for sale (i.e. inventory in transit and unprocessed inventory in the Company’s distribution centers). Under the retail method, TJX utilizes a permanent markdown strategy and lowers the cost value of the inventory that is subject to markdown at the time the retail prices are lowered in the stores. TJX records inventory at the time title transfers, which is typically at the time when inventory is shipped. As a result, merchandise inventories on TJX’s Consolidated Balance Sheets include in-transit inventory of $1.3 billion at January 28, 2023 and $1.7 billion at January 29, 2022. Comparable amounts were reflected in Accounts payable at those dates.

Common Stock and Equity

Equity transactions consist primarily of the repurchase by TJX of its common stock under its stock repurchase programs and the recognition of compensation expense and issuance of common stock under TJX’s Stock Incentive Plan. Under TJX’s stock repurchase programs, the Company repurchases its common stock on the open market. The par value of the shares repurchased is charged to common stock with the excess of the purchase price over par first charged against any available additional paid-in capital (“APIC”) and the balance charged to retained earnings. Due to the volume of share repurchases under previous programs, TJX has historically had no remaining balance in APIC. All shares repurchased have been retired.

F-10

In August 2022, the Inflation Reduction Act of 2022 (“IRA”) was signed into law, which introduces a 1% excise tax after December 31, 2022 on the fair market value of certain stock that is repurchased during the taxable year. The taxable amount is reduced by the fair market value of certain issuances of stock throughout the year. Any excise tax incurred on repurchases will be recognized as part of the cost of the repurchase.

Shares issued under TJX’s Stock Incentive Plan are issued from authorized but unissued shares, and proceeds received are recorded by increasing common stock for the par value of the shares with the excess over par added to APIC. Income tax benefits upon the expensing of options result in the creation of a deferred tax asset, while income tax benefits due to the exercise of stock options reduce deferred tax assets up to the amount that an asset for the related grant has been created. Any excess tax benefits or deficiencies are included in the provision for income taxes. The par value of performance share units and restricted stock units is added to common stock when shares are delivered following performance measurement date or service period to the extent vesting requirements have been achieved. The fair value of stock awards and units are added to APIC as the awards are amortized into earnings over the related requisite service periods.

Share-Based Compensation

TJX accounts for share-based compensation by estimating the fair value of each award on the date of grant. TJX uses the Black-Scholes option pricing model for options awarded and the market price on the grant date for stock awards. Performance-based awards are evaluated quarterly for probability of vesting and performance achievement levels. See Note H—Stock Incentive Plan for a detailed discussion of share-based compensation.

Interest

TJX’s interest expense is presented net of capitalized interest and interest income. The following is a summary of interest expense, net:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Interest expense			$	91		$	123		$	199
Capitalized interest			(7)			(4)			(5)
Interest (income)			(78)			(4)			(13)
Interest expense, net			$	6		$	115		$	181

TJX capitalizes interest during the active construction period of major capital projects and adds the interest to the related assets.

Property and Equipment

For financial reporting purposes, TJX provides for depreciation and amortization of property using the straight-line method over the estimated useful lives of the assets. Buildings are depreciated over 33 years. Leasehold costs and improvements are generally amortized over their useful life or the committed lease term (typically 10 years to 15 years), whichever is shorter. Furniture, fixtures and equipment are depreciated over 3 to 10 years. Depreciation and amortization expense for property was $879 million in fiscal 2023, and $858 million in both fiscal 2022 and fiscal 2021. TJX had no property held under finance leases during fiscal 2023, fiscal 2022 or fiscal 2021. Maintenance and repairs are charged to expense as incurred. Significant costs incurred for internally developed software are capitalized and amortized, generally over 5 years. Upon retirement or sale, the cost of disposed assets and the related accumulated depreciation are eliminated, and any gain or loss is included in income. Pre-opening costs, including rent, are expensed as incurred.

F-11

Lease Accounting

Operating leases are included in “Operating lease right of use assets,” “Current portion of operating lease liabilities,” and “Long-term operating lease liabilities” on the Company’s Consolidated Balance Sheets. Right of use (“ROU”) assets represent TJX’s right to use an underlying asset for the lease term and lease liabilities represent TJX’s obligation to make lease payments arising from the lease. At the inception of the arrangement, the Company determines if an arrangement is a lease based on assessment of the terms and conditions of the contract. Operating lease ROU assets and lease liabilities are recognized at possession date based on the present value of lease payments over the lease term. The majority of the Company’s leases are retail store locations, and the possession date is typically 30 to 60 days prior to the opening of the store and generally occurs before the commencement of the lease term, as specified in the lease. TJX’s lessors do not provide an implicit rate, nor is one readily available, therefore the Company uses its incremental borrowing rate based on the information available at possession date in determining the present value of future lease payments. The incremental borrowing rate is calculated based on the US Consumer Discretionary yield curve and adjusted for collateralization and foreign currency impact for TJX International and Canada leases. The operating lease ROU assets also include any acquisition costs offset by lease incentives. The Company’s lease terms include options to extend the lease when it is reasonably certain that the Company will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term within “Cost of sales, including buying and occupancy costs”. See Note L—Leases for a detailed discussion of lease accounting.

Goodwill and Tradenames

Goodwill includes the excess of the purchase price paid over the carrying value of the minority interest acquired in fiscal 1990 in TJX’s former 83%-owned subsidiary and represents goodwill associated with the T.J. Maxx chain, which is included in the Marmaxx segment. The Company’s goodwill also includes the excess of cost over the estimated fair market value of the net assets acquired by TJX in the purchase of Winners in fiscal 1991, included in TJX Canada, as well as the purchase of Trade Secret in fiscal 2016, which was re-branded under the T.K. Maxx name during fiscal 2018 and is included in TJX International.

The following is a roll forward of goodwill by segment:

In millions			Marmaxx			TJX Canada			TJX International			Total
Balance, January 30, 2021			$	70		$	2		$	27		$	99
Effect of exchange rate changes on goodwill			—			0			(2)			(2)
Balance, January 29, 2022			$	70		$	2		$	25		$	97
Effect of exchange rate changes on goodwill			—			0			0			0
Balance, January 28, 2023			$	70		$	2		$	25		$	97

Goodwill is considered to have an indefinite life and accordingly is not amortized.

Tradenames, which are included in other assets, are the value assigned to the name “Marshalls,” acquired by TJX in fiscal 1996 as part of the acquisition of the Marshalls chain, the value assigned to the name “Sierra Trading Post,” acquired by TJX in fiscal 2013 and the value assigned to the name “Trade Secret,” acquired by TJX in fiscal 2016. The tradenames were valued utilizing the relief from royalty method, which calculates the discounted present value of assumed after-tax royalty payments. The Marshalls tradename is considered to have an indefinite life and accordingly is not amortized. The Sierra Trading Post tradename is being amortized over 15 years. During the first quarter of fiscal 2021, the Company fully impaired the Trade Secret tradename, recording an impairment charge of $5 million.

The following is a roll forward of tradenames:

			Fiscal Year Ended
			January 28, 2023												January 29, 2022
In millions			Gross Carrying Amount						Accumulated Amortization						Net Carrying Value						Gross Carrying Amount			Accumulated Amortization						Net Carrying Value
Definite-lived intangible assets:
Sierra Trading Post			$	39					$	(27)					$	12					$	39		$	(24)					$	15
Trade Secret			$	13					$	(13)					$	—					$	13		$	(13)					$	—
Indefinite-lived intangible asset:
Marshalls			$	108					$	—					$	108					$	108		$	—					$	108

F-12

TJX occasionally acquires or licenses other trademarks to be used in connection with private label merchandise. Such trademarks are included in other assets and are amortized to cost of sales, including buying and occupancy costs, over their useful life, generally from 7 to 10 years.

Goodwill, tradenames and trademarks, and the related accumulated amortization or impairment if any, are included in the respective operating segment to which they relate.

Impairment of Long-Lived Assets, Goodwill and Tradenames

TJX evaluates long-lived assets, including tradenames that are amortized and operating lease right of use assets, for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. This evaluation is performed at the lowest level of identifiable cash flows which are largely independent of other groups of assets, generally at the individual store level for fixed assets and operating lease right of use assets, and at the reporting unit for tradenames that are amortized. If indicators of impairment are identified, an undiscounted cash flow analysis is performed to determine if the carrying value of the asset or asset group is recoverable. If the cash flow is less than the carrying value then an impairment charge will be recorded to the extent the fair value of an asset or asset group is less than the carrying value of that asset or asset group. This resulted in immaterial impairment charges on operating lease ROU assets and store fixed assets in fiscal 2023, fiscal 2022 and fiscal 2021. In fiscal 2021, the Company fully impaired the Trade Secret tradename. There were no impairments related to tradenames in fiscal 2023 or fiscal 2022.

Goodwill and indefinite life tradenames are tested for impairment whenever events or changes in circumstances indicate that an impairment may have occurred and at least annually in the fourth quarter of each fiscal year. Goodwill is tested for impairment by using a quantitative assessment by comparing the carrying value of the related reporting unit to its fair value. An impairment exists when this analysis, using typical valuation models such as the discounted cash flow method, shows that the fair value of the reporting unit is less than the carrying cost of the reporting unit. The Company may assess qualitative factors to determine if it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. The assessment of qualitative factors is optional and at the Company’s discretion. Indefinite life tradenames are tested for impairment by comparing their carrying value to their fair value, which is determined by calculating the discounted present value of assumed after-tax royalty payments. In fiscal 2023, fiscal 2022 and fiscal 2021, the Company bypassed the qualitative assessment and performed the quantitative impairment test. There were no impairments related to the Company’s goodwill or indefinite life tradenames in fiscal 2023, fiscal 2022, or fiscal 2021.

Advertising Costs

TJX expenses advertising costs as incurred. Advertising expense was $0.5 billion for both fiscal 2023 and fiscal 2022 and $0.3 billion for fiscal 2021.

Foreign Currency Translation

TJX’s foreign assets and liabilities are translated into U.S. dollars at fiscal year-end exchange rates with resulting translation gains and losses included in shareholders’ equity as a component of Accumulated other comprehensive (loss) income. Activity of the foreign operations that affect the Consolidated Statements of Income and Cash Flows is translated at average exchange rates prevailing during the fiscal year.

Loss Contingencies

TJX records a reserve for loss contingencies when it is both probable that a loss will be incurred and the amount of the loss is reasonably estimable. TJX evaluates pending litigation and other contingencies at least quarterly and adjusts the reserve for such contingencies for changes in probable and reasonably estimable losses. TJX includes an estimate for related legal costs at the time such costs are both probable and reasonably estimable.

Equity Investment

In fiscal 2020, the Company acquired a minority ownership stake in privately held Familia, an off-price retailer of apparel and home fashions domiciled in Luxembourg that operates stores throughout Russia. During fiscal 2023, the Company announced that it had committed to divesting its minority investment. As a result, the Company performed an impairment analysis of this investment and recorded an impairment charge of $218 million representing the entire carrying value of the Company’s investment. Additionally, the Company realized a $54 million tax benefit when the Company completed the divestiture of this investment during the third quarter ended October 29, 2022. See Note F—Fair Value Measurements for additional information.

As of the end of fiscal 2022, the carrying value of the Company’s equity investment in Familia was $186 million, which exceeded its share of Familia’s net assets by approximately $167 million. Substantially all of this difference was comprised of goodwill.

F-13

Future Adoption of New Accounting Standards

From time to time, the Financial Accounting Standards Board (“FASB”) or other standard setting bodies issue new accounting pronouncements. Updates to the FASB Accounting Standards Codification are communicated through issuance of an Accounting Standards Update (“ASU”). The Company has reviewed the new guidance and has determined that it will either not apply to TJX or is not expected to be material to its Consolidated Financial Statements upon adoption, and, therefore, the guidance is not disclosed.

Note B. Property at Cost

The following table presents the components of property at cost:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022
Land and buildings			$	2,043		$	1,912
Leasehold costs and improvements			3,874			3,652
Furniture, fixtures and equipment			7,400			6,872
Total property at cost			$	13,317		$	12,436
Less accumulated depreciation and amortization			7,534			7,165
Net property at cost			$	5,783		$	5,271

Presented below is information related to carrying values of TJX’s long-lived tangible assets by geographic location:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022
United States			$	4,518		$	4,041
Canada			274			248
Europe			923			927
Australia			68			55
Total long-lived tangible assets			$	5,783		$	5,271

F-14

Note C. Accumulated Other Comprehensive (Loss) Income

Amounts included in Accumulated other comprehensive (loss) income relate to the Company’s foreign currency translation adjustments, deferred gains/losses on pension and other post-retirement obligations and a cash flow hedge on issued debt, all of which are recorded net of the related income tax effects. The following table details the changes in Accumulated other comprehensive (loss) income for fiscal 2023, fiscal 2022 and fiscal 2021:

In millions and net of immaterial taxes			Foreign Currency Translation			Deferred Benefit Costs			Cash Flow Hedge on Debt			Accumulated Other Comprehensive (Loss) Income
Balance, February 1, 2020			$	(457)		$	(215)		$	(1)		$	(673)
Additions to other comprehensive loss:
Foreign currency translation adjustments, net of taxes			14			—			—			14
Recognition of net gains/losses on benefit obligations, net of taxes			—			31			—			31
Reclassifications from other comprehensive loss to net income:
Amortization of loss on cash flow hedge, net of taxes			—			—			1			1
Amortization of prior service cost and deferred gains/losses, net of taxes			—			20			—			20
Balance, January 30, 2021			$	(443)		$	(164)		$	—		$	(607)
Additions to other comprehensive loss:
Foreign currency translation adjustments, net of taxes			(45)			—			—			(45)
Recognition of net gains/losses on benefit obligations, net of taxes			—			(48)			—			(48)
Reclassifications from other comprehensive loss to net income:
Amortization of loss on cash flow hedge, net of taxes			—			—			0			0
Amortization of prior service cost and deferred gains/losses, net of taxes			—			13			—			13
Balance, January 29, 2022			$	(488)		$	(199)		$	—		$	(687)
Additions to other comprehensive loss:
Foreign currency translation adjustments, net of taxes			(56)			—			—			(56)
Recognition of net gains/losses on benefit obligations, net of taxes			—			121			—			121
Reclassifications from other comprehensive loss to net income:
Amortization of prior service cost and deferred gains/losses, net of taxes			—			16			—			16
Balance, January 28, 2023			$	(544)		$	(62)		$	—		$	(606)

Note D. Capital Stock and Earnings Per Share

Capital Stock

TJX repurchased and retired 35 million shares of its common stock at a cost of approximately $2.3 billion during fiscal 2023, on a “trade date” basis. TJX reflects stock repurchases in its consolidated financial statements on a “settlement date” or cash basis. TJX had cash expenditures under repurchase programs of $2.3 billion in fiscal 2023, $2.2 billion in fiscal 2022 and $0.2 billion in fiscal 2021 and repurchased 35 million shares in fiscal 2023, 31 million shares in fiscal 2022 and 3 million shares in fiscal 2021. These expenditures were funded by cash on hand and cash generated from operations.

In February 2023, the Company announced that its Board of Directors had approved a new stock repurchase program that authorizes the repurchase of up to an additional $2 billion of TJX common stock from time to time. Under this program and previously announced programs, TJX had approximately $3.5 billion available for repurchase as of January 28, 2023.

All shares repurchased under the stock repurchase programs have been retired.

TJX has five million shares of authorized but unissued preferred stock, $1 par value.

F-15

Earnings Per Share

The following table presents the calculation of basic and diluted earnings per share:

			Fiscal Year Ended
Amounts in millions except per share amounts			January 28, 2023			January 29, 2022			January 30, 2021
Basic earnings per share:
Net income			$	3,498		$	3,283		$	90
Weighted average common shares outstanding for basic earnings per share calculation			1,166			1,200			1,200
Basic earnings per share			$	3.00		$	2.74		$	0.08
Diluted earnings per share:
Net income			$	3,498		$	3,283		$	90
Weighted average common shares outstanding for basic earnings per share calculation			1,166			1,200			1,200
Assumed exercise/vesting of stock options and awards			12			16			15
Weighted average common shares outstanding for diluted earnings per share calculation			1,178			1,216			1,215
Diluted earnings per share			$	2.97		$	2.70		$	0.07
Cash dividends declared per share*(a)*			$	1.18		$	1.04		$	0.26

(a)There were no dividends declared during the first three quarters of fiscal 2021. The Company declared a dividend of $0.26 per share in the fourth quarter of fiscal 2021.

The weighted average common shares for the diluted earnings per share calculation excludes the impact of outstanding stock options if the assumed proceeds per share of the option is in excess of the average price of TJX’s common stock for the related fiscal periods. Such options are excluded because they would have an antidilutive effect. There were 6 million, 5 million, and 6 million such options excluded at the end of fiscal 2023, fiscal 2022 and fiscal 2021, respectively.

Note E. Financial Instruments

As a result of its operating and financing activities, TJX is exposed to market risks from changes in interest and foreign currency exchange rates and fuel costs. These market risks may adversely affect TJX’s operating results and financial position. TJX seeks to minimize risk from changes in interest and foreign currency exchange rates and fuel costs through the use of derivative financial instruments when and to the extent deemed appropriate. TJX does not use derivative financial instruments for trading or other speculative purposes and does not use any leveraged derivative financial instruments. TJX recognizes all derivative instruments as either assets or liabilities in the Consolidated Balance Sheet and measures those instruments at fair value. The fair values of the derivatives are classified as assets or liabilities, current or non-current, based upon valuation results and settlement dates of the individual contracts. Changes to the fair value of derivative contracts that do not qualify for hedge accounting are reported in earnings in the period of the change. For derivatives that qualify for hedge accounting, changes in the fair value of the derivatives are either recorded in shareholders’ equity as a component of Accumulated other comprehensive (loss) or are recognized currently in earnings, along with an offsetting adjustment against the basis of the item being hedged.

Diesel Fuel Contracts

TJX hedges portions of its estimated notional diesel fuel requirements based on the diesel fuel expected to be consumed by independent freight carriers transporting TJX’s inventory. Independent freight carriers transporting TJX’s inventory charge TJX a mileage surcharge based on the price of diesel fuel. The hedge agreements are designed to mitigate the volatility of diesel fuel pricing, and the resulting per mile surcharges payable by TJX, by setting a fixed price per gallon for the period being hedged. During fiscal 2023, TJX entered into agreements to hedge a portion of its estimated notional diesel fuel requirements for fiscal 2024. The hedge agreements outstanding at January 28, 2023 relate to approximately 50% of TJX’s estimated notional diesel fuel requirements for fiscal 2024. These diesel fuel hedge agreements will settle throughout fiscal 2024 and the first month of fiscal 2025. TJX elected not to apply hedge accounting to these contracts.

F-16

Foreign Currency Contracts

TJX enters into forward foreign currency exchange contracts to obtain economic hedges on portions of merchandise purchases made and anticipated to be made by the Company’s operations in currencies other than their respective functional currencies. The contracts outstanding at January 28, 2023 cover merchandise purchases the Company is committed to over the next several months in fiscal 2024. Additionally, TJX’s operations in Europe are subject to foreign currency exposure as a result of their buying function being centralized in the U.K. Merchandise is purchased centrally in the U.K. and then shipped and billed to the retail entities in other countries. This intercompany billing to TJX’s European businesses’ Euro denominated operations creates exposure to the central buying entity for changes in the exchange rate between the Euro and British Pound. A portion of the inflows of Euros to the central buying entity provides a natural hedge for merchandise purchased from third-party vendors that is denominated in Euros. TJX calculates any excess Euro exposure each month and enters into forward contracts of approximately 30 days’ duration to mitigate this exposure.

TJX also enters into derivative contracts, generally designated as fair value hedges, to hedge intercompany debt. The changes in fair value of these contracts are recorded in Selling, general and administrative expenses and are offset by marking the underlying item to fair value in the same period. Upon settlement, the realized gains and losses on these contracts are offset by the realized gains and losses of the underlying item in Selling, general and administrative expenses.

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at January 28, 2023:

In millions						Pay			Receive						Blended Contract Rate			Balance Sheet Location			Current Asset U.S.$			Current (Liability) U.S.$			Net Fair Value in U.S.$ at January 28, 2023
Fair value hedges:
Intercompany balances, primarily debt:
			€			60			£			53			0.8807			(Accrued Exp)			$	—		$	(0.3)		$	(0.3)
			A$			150			U.S.$			105			0.7003			(Accrued Exp)			—			(2.6)			(2.6)
			U.S.$			69			£			55			0.8010			(Accrued Exp)			—			(0.3)			(0.3)
			£			200			U.S.$			244			1.2191			(Accrued Exp)			—			(5.5)			(5.5)
			€			200			U.S.$			213			1.0652			Prepaid Exp / (Accrued Exp)			0.8			(7.0)			(6.2)
Economic hedges for which hedge accounting was not elected:
			Diesel fuel contracts			Fixed on 3.2M - 3.6M gal per month						Float on 3.2M - 3.6M gal per month			N/A			Prepaid Exp			3.9			—			3.9
Intercompany billings in TJX International, primarily merchandise related:
			€			146			£			129			0.8834			Prepaid Exp			0.8			—			0.8
Merchandise purchase commitments:
			C$			705			U.S.$			525			0.7449			Prepaid Exp / (Accrued Exp)			2.2			(7.1)			(4.9)
			C$			23			€			16			0.7064			Prepaid Exp / (Accrued Exp)			0.4			0.0			0.4
			£			299			U.S.$			356			1.1916			Prepaid Exp / (Accrued Exp)			0.1			(15.4)			(15.3)
			zł			507			£			91			0.1788			(Accrued Exp)			—			(3.6)			(3.6)
			A$			104			U.S.$			71			0.6819			(Accrued Exp)			—			(3.3)			(3.3)
			U.S.$			85			€			82			0.9634			Prepaid Exp			4.3			—			4.3
Total fair value of derivative financial instruments																					$	12.5		$	(45.1)		$	(32.6)

F-17

The following is a summary of TJX’s derivative financial instruments, related fair value and balance sheet classification at January 29, 2022:

In millions						Pay			Receive						Blended Contract Rate			Balance Sheet Location			Current Asset U.S.$			Current (Liability) U.S.$			Net Fair Value in U.S.$ at January 29, 2022
Fair value hedges:
Intercompany balances, primarily debt:
			zł			25			£			5			0.1816			Prepaid Exp			$	0.1		$	—		$	0.1
			€			60			£			51			0.8428			Prepaid Exp			0.1			—			0.1
			A$			170			U.S.$			122			0.7180			Prepaid Exp			2.0			—			2.0
			U.S.$			75			£			55			0.7368			(Accrued Exp)			—			(1.0)			(1.0)
			€			200			U.S.$			230			1.1516			Prepaid Exp			4.5			—			4.5
Economic hedges for which hedge accounting was not elected:
			Diesel fuel contracts			Fixed on 3.6M - 4.0M gal per month						Float on 3.6M - 4.0M gal per month			N/A			Prepaid Exp			23.7			—			23.7
Intercompany billings in TJX International, primarily merchandise related:
			€			91			£			76			0.8340			(Accrued Exp)			—			(0.1)			(0.1)
Merchandise purchase commitments:
			C$			988			U.S.$			783			0.7927			Prepaid Exp / (Accrued Exp)			6.7			(0.1)			6.6
			C$			38			€			27			0.6948			(Accrued Exp)			—			(0.2)			(0.2)
			£			325			U.S.$			442			1.3583			Prepaid Exp / (Accrued Exp)			6.0			(0.6)			5.4
			zł			453			£			82			0.1813			Prepaid Exp / (Accrued Exp)			0.7			(0.4)			0.3
			A$			66			U.S.$			48			0.7246			Prepaid Exp			1.3			—			1.3
			U.S.$			67			€			59			0.8807			(Accrued Exp)			—			(0.9)			(0.9)
Total fair value of derivative financial instruments																					$	45.1		$	(3.3)		$	41.8

The impact of derivative financial instruments on the Consolidated Statements of Income is presented below:

			Location of Gain (Loss) Recognized in Income by Derivative			Amount of Gain (Loss) Recognized in Income by Derivative
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Fair value hedges:
Intercompany balances, primarily debt			Selling, general and administrative expenses			$	12		$	36		$	(60)
Economic hedges for which hedge accounting was not elected:
Diesel fuel contracts			Cost of sales, including buying and occupancy costs			55			43			(6)
Intercompany billings in TJX International, primarily merchandise related			Cost of sales, including buying and occupancy costs			(9)			5			(4)
Merchandise purchase commitments			Cost of sales, including buying and occupancy costs			71			24			(4)
Gain (loss) recognized in income						$	129		$	108		$	(74)

Included in the table above are realized gains of $200 million in fiscal 2023 and $54 million in fiscal 2022 and realized losses of $74 million in fiscal 2021, all of which were largely offset by gains and losses on the underlying hedged item.

F-18

Note F. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date or “exit price”. The inputs used to measure fair value are generally classified into the following hierarchy:

Level 1:						Unadjusted quoted prices in active markets for identical assets or liabilities
Level 2:						Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability
Level 3:						Unobservable inputs for the asset or liability

The following table sets forth TJX’s financial assets and liabilities that are accounted for at fair value on a recurring basis:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022
Level 1
Assets:
Executive Savings Plan investments			$	371.6		$	387.7
Level 2
Assets:
Foreign currency exchange contracts			$	8.6		$	21.4
Diesel fuel contracts			3.9			23.7
Liabilities:
Foreign currency exchange contracts			$	45.1		$	3.3

Investments designed to meet obligations under the Executive Savings Plan are invested in registered investment companies traded in active markets and are recorded at unadjusted quoted prices.

Foreign currency exchange contracts and diesel fuel contracts are valued using broker quotations, which include observable market information. TJX does not make adjustments to quotes or prices obtained from brokers or pricing services but does assess the credit risk of counterparties and will adjust final valuations when appropriate. Where independent pricing services provide fair values, TJX obtains an understanding of the methods used in pricing. As such, these instruments are classified within Level 2.

The fair value of TJX’s general corporate debt was estimated by obtaining market quotes given the trading levels of other bonds of the same general issuer type and market perceived credit quality. These inputs are considered to be Level 2 inputs. The fair value of long-term debt at January 28, 2023 was $2.6 billion compared to a carrying value of $2.9 billion primarily due to the increase in interest rates. The fair value and the carrying value of the current portion of long-term debt as of January 28, 2023 were both $0.5 billion. The fair value of long-term debt at January 29, 2022 was $3.5 billion compared to a carrying value of $3.4 billion. These estimates do not necessarily reflect provisions or restrictions in the various debt agreements that might affect TJX’s ability to settle these obligations. For additional information on long-term debt, see Note J—Long-Term Debt and Credit Lines.

TJX’s cash equivalents are stated at cost, which approximates fair value due to the short maturities of these instruments.

Certain assets and liabilities are measured at fair value on a nonrecurring basis, whereas the majority of assets and liabilities are not measured at fair value on an ongoing basis, but are subject to fair value adjustments in certain circumstances, such as when there is evidence of an impairment. For the years ended January 28, 2023, January 29, 2022 and January 30, 2021, the Company did not record any material impairments to long-lived assets.

During the first quarter of fiscal 2023, the Company announced its intention to divest from its position in its minority investment in Familia and re-characterized this investment as held-for-sale valued as a Level 3 position. Given the lack of an active market or observable inputs, the Company derived an exit price which indicated that this investment had no market value. As a result, the Company recorded a $218 million charge in the first quarter of fiscal 2023, which represents the entirety of its investment. See Note A—Basis of Presentation and Summary of Accounting Policies for additional information.

F-19

Note G. Segment Information

TJX operates four main business segments. The Marmaxx segment (T.J. Maxx, Marshalls, tjmaxx.com and marshalls.com) and the HomeGoods segment (HomeGoods, Homesense and homegoods.com) both operate in the United States, the TJX Canada segment operates Winners, HomeSense and Marshalls in Canada, and the TJX International segment operates T.K. Maxx, Homesense and tkmaxx.com in Europe and T.K. Maxx in Australia. In addition to the Company’s four main business segments, Sierra operates retail stores and sierra.com in the U.S. The results of Sierra are included in the Marmaxx segment.

All of TJX’s stores, with the exception of HomeGoods and HomeSense/Homesense, sell family apparel and home fashions. HomeGoods and HomeSense/Homesense offer home fashions. The percentages of the Company’s consolidated revenues by major product category for the last three fiscal years are as follows:

			Fiscal 2023			Fiscal 2022			Fiscal 2021
Apparel:
Clothing including footwear			48		%	47		%	46		%
Jewelry and accessories			17			15			15
Home fashions			35			38			39
Total			100		%	100		%	100		%

TJX evaluates the performance of its segments based on “segment profit or loss,” which it defines as pre-tax income or loss before general corporate expense, interest expense, net and certain separately disclosed unusual or infrequent items. “Segment profit or loss,” as defined by TJX, may not be comparable to similarly titled measures used by other entities. This measure of performance should not be considered an alternative to net income or cash flows from operating activities as an indicator of TJX’s performance or as a measure of liquidity.

Presented below is financial information with respect to TJX’s business segments:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Net sales:
In the United States:
Marmaxx			$	30,545		$	29,483		$	19,363
HomeGoods			8,264			8,995			6,096
TJX Canada			4,912			4,343			2,836
TJX International			6,215			5,729			3,842
Total net sales			$	49,936		$	48,550		$	32,137
Segment profit (loss):
In the United States:
Marmaxx			$	3,883		$	3,813		$	891
HomeGoods			522			907			510
TJX Canada			690			485			124
TJX International			347			161			(504)
Total segment profit			$	5,442		$	5,366		$	1,021
General corporate expense			582			611			439
Impairment on equity investment			218			—			—
Loss on early extinguishment of debt			—			242			312
Interest expense, net			6			115			181
Income before income taxes			$	4,636		$	4,398		$	89

F-20

Business segment information (continued):

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Identifiable assets:
In the United States:
Marmaxx			$	12,170		$	11,229		$	10,221
HomeGoods			3,590			3,461			2,851
TJX Canada			2,003			2,197			2,035
TJX International			4,075			4,281			4,389
Corporate(a)			6,511			7,293			11,318
Total identifiable assets			$	28,349		$	28,461		$	30,814
Capital expenditures:
In the United States:
Marmaxx			$	822		$	513		$	216
HomeGoods			295			244			162
TJX Canada			110			69			44
TJX International			230			219			146
Total capital expenditures			$	1,457		$	1,045		$	568
Depreciation and amortization:
In the United States:
Marmaxx			$	480		$	465		$	479
HomeGoods			165			149			135
TJX Canada			70			73			71
TJX International			167			174			176
Corporate(b)			5			7			10
Total depreciation and amortization			$	887		$	868		$	871

(a)Corporate identifiable assets consist primarily of cash, the trust assets in connection with the Executive Savings Plan and in fiscal 2022 and fiscal 2021 included the minority investment in Familia. Consolidated cash, including cash held in the Company’s foreign entities, is included with corporate assets for consistency with the reporting of cash for the Company’s segments in the U.S.

(b)Includes debt discount accretion and debt expense amortization.

Note H. Stock Incentive Plan

TJX has a Stock Incentive Plan under which options and other share-based awards may be granted to its directors, officers and key employees. The number of shares authorized for issuance under this plan has been approved by TJX’s shareholders, and all share-based compensation awards are made under this plan. The Stock Incentive Plan, as amended with shareholder approval, has provided for the issuance of up to 723 million shares with 49 million shares available for future grants as of January 28, 2023. TJX issues shares under the plan from authorized but unissued common stock.

Total compensation cost related to share-based compensation was $122 million, $189 million and $59 million in fiscal 2023, 2022 and 2021, respectively. As of January 28, 2023, there was $178 million of total unrecognized compensation cost related to non-vested share-based compensation arrangements granted under the plan. That cost is expected to be recognized over a weighted-average period of 2 years.

Stock Options

Options for the purchase of common stock are granted with an exercise price that is 100% of market price on the grant date, generally vest in thirds over a 3-year period starting 1 year after the grant, and have a 10-year maximum term. When options are granted with other vesting terms, the vesting information is reflected in the valuation.

F-21

The fair value of options is estimated as of the date of grant using the Black-Scholes option pricing model with the following weighted average assumptions:

			Fiscal Year Ended
			January 28, 2023			January 29, 2022			January 30, 2021
Risk-free interest rate			3.69		%	0.84		%	0.28		%
Dividend yield			1.8		%	1.5		%	1.4		%
Expected volatility factor			26.0		%	23.8		%	26.5		%
Expected option life			5.5 years			5.0 years			5.0 years
Weighted average fair value of options issued			$	16.68		$	12.85		$	11.29

The risk-free interest rate is for periods within the contractual life of the option based on the U.S. Treasury yield curve in effect at the time of grant. The Company uses historical data to estimate option exercises, employee termination behavior and dividend yield within the valuation model. Expected volatility is based on a combination of implied volatility from traded options on the Company’s stock, and historical volatility during a term approximating the expected life of the option granted. The expected option life represents an estimate of the period of time options are expected to remain outstanding based upon historical exercise trends. Employee groups and option characteristics are considered separately for valuation purposes when applicable.

A summary of the status of TJX’s stock options and related weighted average exercise prices (“WAEP”) is presented below:

			Fiscal Year Ended
Shares in millions			January 28, 2023						January 29, 2022						January 30, 2021
			Options			WAEP			Options			WAEP			Options			WAEP
Outstanding at beginning of year			40			$	47.11		43			$	41.79		45			$	36.81
Granted			6			65.54			5			70.48			6			57.32
Exercised			(8)			38.12			(7)			32.04			(8)			25.68
Forfeitures			(1)			63.29			(1)			57.55			0			52.96
Outstanding at end of year			37			$	51.88		40			$	47.11		43			$	41.79
Options exercisable at end of year			26			$	45.99		29			$	40.93		31			$	36.05

The total intrinsic value of options exercised was $0.3 billion in each of fiscal 2023, fiscal 2022 and fiscal 2021.

The following table summarizes information about stock options outstanding that were expected to vest and stock options outstanding that were exercisable as of January 28, 2023:

			Shares (in millions)			Aggregate Intrinsic Value (in millions)			Weighted Average Remaining Contract Life			WAEP
Options outstanding expected to vest(a)			10			$	170		9.0 years			$	65.58
Options exercisable			26			939			4.9 years			45.99
Total outstanding options vested and expected to vest			36			$	1,109		6.1 years			$	51.58

(a)Reflects 11 million unvested options, net of anticipated forfeitures.

Stock Awards

TJX grants restricted stock units and performance share units under the Stock Incentive Plan. Restricted stock units and performance share units are collectively referred to as stock awards. These stock awards were granted without a purchase price to the recipient and are subject to vesting conditions. Vesting conditions for performance share units include specified performance criteria, generally for a period of three fiscal years. The grant date fair value of the stock awards is charged to income over the requisite service period during which the recipient must remain employed. The fair value of the stock awards is determined at date of grant in accordance with ASC Topic 718 and, for performance share units, assumes that performance goals will be achieved at target. Performance share units and related compensation costs recognized are adjusted, as applicable, for performance above or below the target specified in the award.

F-22

During fiscal 2022, modifications were approved to previously-granted nonvested performance share unit awards. Under ASC Topic 718 these modifications required that the fair value of these awards be adjusted to reflect the fair value on the date of the modification and resulted in a share-based compensation charge of $37 million in fiscal 2022. There were no modifications to stock awards in fiscal 2023.

A summary of the status of the Company’s non-vested stock awards and changes during fiscal 2023 is presented below:

In thousands except grant date fair value			Restricted Stock Units			Performance Share Units			Total Stock Awards			Weighted Average Grant Date Fair Value
Nonvested at beginning of year			1,836			932			2,768			$	58.91
Granted			461			471			932			60.46
Vested			(368)			(627)			(995)			55.27
Forfeited			(62)			(15)			(77)			27.29
Nonvested at end of year			1,867			761			2,628			$	61.76

There were 932 thousand units with a weighted average grant date fair value of $60.46, granted in fiscal 2023, 820 thousand units, with a weighted average grant date fair value of $65.53, granted in fiscal 2022 and 857 thousand units, with a weighted average grant date fair value of $56.24, granted in fiscal 2021. The fair value of awards that vested was $55 million in fiscal 2023, $44 million in fiscal 2022 and $57 million in fiscal 2021.

The nonvested performance share units are based on the target level of performance achievement under the awards. The actual payout of performance share units will depend on performance results for the award cycle.

Other Awards

TJX also awards deferred shares to its outside directors under the Stock Incentive Plan. As of the end of fiscal 2023, a total of 433 thousand of these deferred shares were outstanding under the plan.

Note I. Pension Plans and Other Retirement Benefits

Pension

TJX has a funded defined benefit retirement plan that covers eligible U.S. employees hired prior to February 1, 2006. No employee contributions are required, or permitted, and benefits are based principally on compensation earned in each year of service. TJX’s funded defined benefit retirement plan assets are invested in domestic and international equity and fixed income securities, both directly and through investment funds. The plan does not invest in TJX securities. TJX also has an unfunded supplemental retirement plan that covers certain key employees and provides additional retirement benefits based on final average compensation for certain of those employees (the “primary benefit”) or, alternatively, based on benefits that would be provided under the funded retirement plan absent Internal Revenue Code limitations (the “alternative benefit”).

Presented below is financial information relating to TJX’s funded defined benefit pension plan (“qualified pension plan” or “funded plan”) and its unfunded supplemental pension plan (“unfunded plan”) for the fiscal years indicated. The Company has elected the practical expedient pursuant to ASU 2015-4–Compensation-retirement benefits (Topic 715) and has selected the measurement date of January 31, the calendar month end closest to the Company’s fiscal year end.

			Funded Plan Fiscal Year Ended						Unfunded Plan Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 28, 2023			January 29, 2022
Change in projected benefit obligation:
Projected benefit obligation at beginning of year			$	1,717		$	1,619		$	114		$	113
Service cost			48			49			2			2
Interest cost			58			52			4			3
Actuarial (gains) losses			(442)			29			(9)			0
Benefits paid			(35)			(29)			(2)			(4)
Expenses paid			(3)			(3)			—			—
Projected benefit obligation at end of year			$	1,343		$	1,717		$	109		$	114
Accumulated benefit obligation at end of year			$	1,241		$	1,560		$	93		$	100

F-23

			Funded Plan Fiscal Year Ended						Unfunded Plan Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 28, 2023			January 29, 2022
Change in plan assets:
Fair value of plan assets at beginning of year			$	1,713		$	1,686		$	—		$	—
Actual return on plan assets			(200)			59			—			—
Employer contribution			0			0			2			4
Benefits paid			(35)			(29)			(2)			(4)
Expenses paid			(3)			(3)			—			—
Fair value of plan assets at end of year			$	1,475		$	1,713		$	—		$	—
Reconciliation of funded status:
Projected benefit obligation at end of year			$	1,343		$	1,717		$	109		$	114
Fair value of plan assets at end of year			1,475			1,713			—			—
Funded status – excess (asset) obligation			$	(132)		$	4		$	109		$	114
Net (asset) liability recognized on Consolidated Balance Sheets			$	(132)		$	4		$	109		$	114
Amounts not yet reflected in net periodic benefit cost and included in Accumulated other comprehensive income (loss):
Prior service cost			$	0		$	0		$	—		$	—
Accumulated actuarial losses			126			297			19			32
Amounts included in Accumulated other comprehensive income (loss)			$	126		$	297		$	19		$	32

The Consolidated Balance Sheets reflect the funded status of the plans with any unrecognized prior service cost and actuarial gains and losses recorded in Accumulated other comprehensive income (loss). The funded plan asset of $132 million is reflected on the Consolidated Balance Sheets in other current assets as of January 28, 2023. The unfunded plan liability is reflected on the Consolidated Balance Sheets as of January 28, 2023 as current liabilities of $4 million and a long-term liability of $105 million. The combined net accrued liability of $118 million at January 29, 2022 is reflected on the Consolidated Balance Sheets as of that date as a current liability of $4 million and a long-term liability of $114 million.

The decrease in the actuarial losses included in Accumulated other comprehensive income (loss) for the funded plan for fiscal 2023 was driven by the impact of higher discount rates offset by a decrease in actual return on plan assets.

TJX determined the assumed discount rate using the BOND: Link model in fiscal 2023 and fiscal 2022. TJX uses the BOND: Link model as this model allows for the selection of specific bonds resulting in better matches in timing of the plans’ expected cash flows. Presented below are weighted average assumptions for measurement purposes for determining the obligation at the year-end measurement date:

			Funded Plan Fiscal Year Ended						Unfunded Plan Fiscal Year Ended
			January 28, 2023			January 29, 2022			January 28, 2023			January 29, 2022
Discount rate			5.40		%	3.40		%	5.60		%	3.30		%
Rate of compensation increase			4.00		%	4.00		%	4.00		%	4.00		%

TJX made aggregate cash contributions of $3 million in fiscal 2023 and $5 million in fiscal 2022 to the funded plan and to fund current benefit and expense payments under the unfunded plan. TJX’s policy with respect to the funded plan is to fund, at a minimum, the amount required to maintain a funded status of 80% of the applicable pension liability (the Funding Target pursuant to the Internal Revenue Code section 430) or such other amount as is sufficient to avoid restrictions with respect to the funding of nonqualified plans under the Internal Revenue Code. The Company does not anticipate any required funding in fiscal 2024 for the funded plan. The Company anticipates making contributions of $4 million to provide current benefits coming due under the unfunded plan in fiscal 2024.

F-24

The following are the components of net periodic benefit cost and other amounts recognized in other comprehensive income (loss) related to the Company’s pension plans:

			Funded Plan Fiscal Year Ended									Unfunded Plan Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021			January 28, 2023			January 29, 2022			January 30, 2021
Net periodic pension cost:
Service cost			$	48		$	49		$	50		$	2		$	2		$	2
Interest cost			58			52			50			4			3			3
Expected return on plan assets			(89)			(95)			(88)			—			—			—
Amortization of prior service cost			0			0			0			—			—			—
Amortization of net actuarial loss			18			14			23			4			4			4
Total expense			$	35		$	20		$	35		$	10		$	9		$	9
Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Net (gain) loss			$	(153)		$	66		$	(49)		$	(9)		$	0		$	8
Amortization of net (loss)			(18)			(14)			(23)			(4)			(4)			(4)
Amortization of prior service cost			0			0			0			—			—			—
Total (gain) loss recognized in other comprehensive income			$	(171)		$	52		$	(72)		$	(13)		$	(4)		$	4
Total recognized in net periodic benefit cost and other comprehensive income (loss)			$	(136)		$	72		$	(37)		$	(3)		$	5		$	13
Weighted average assumptions for expense purposes:
Discount rate			3.40		%	3.20		%	3.30		%	3.30		%	2.80		%	3.10		%
Expected rate of return on plan assets			5.25		%	5.75		%	5.75		%	N/A			N/A			N/A
Rate of compensation increase			4.00		%	4.00		%	4.00		%	4.00		%	4.00		%	4.00		%

TJX develops its long-term rate of return assumption by evaluating input from professional advisors taking into account the asset allocation of the portfolio and long-term asset class return expectations, as well as long-term inflation assumptions.

The unrecognized gains and losses in excess of 10% of the projected benefit obligation are amortized over the average remaining service life of participants.

The following is a schedule of the benefits expected to be paid in each of the next five fiscal years and in the aggregate for the five fiscal years thereafter:

In millions			Funded Plan Expected Benefit Payments			Unfunded Plan Expected Benefit Payments
Fiscal Year:
2024			$	47		$	4
2025			53			8
2026			59			50
2027			65			8
2028			71			9
2029 through 2033			440			43

F-25

The following tables present the fair value hierarchy (See Note F—Fair Value Measurements) for pension assets measured at fair value on a recurring basis:

			Funded Plan at January 28, 2023
In millions			Level 1			Level 2			Total
Asset category:
Short-term investments			$	9		$	—		$	9
Equity Securities			163			—			163
Fixed Income Securities:
Corporate and government bond funds			—			882			882
Futures Contracts			—			(4)			(4)
Total assets in the fair value hierarchy			$	172		$	878		$	1,050
Assets measured at net asset value(a)			—			—			425
Fair value of assets			$	172		$	878		$	1,475

			Funded Plan at January 29, 2022
In millions			Level 1			Level 2			Total
Asset category:
Short-term investments			$	8		$	—		$	8
Equity Securities			178			—			178
Fixed Income Securities:
Corporate and government bond funds			—			1,022			1,022
Futures Contracts			—			3			3
Total assets in the fair value hierarchy			$	186		$	1,025		$	1,211
Assets measured at net asset value(a)			—			—			502
Fair value of assets			$	186		$	1,025		$	1,713

(a)In accordance with Subtopic 820-10, certain investments that were measured using net asset value per share (or its equivalent) as a practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the fair value of assets presented above.

Pension plan assets are reported at fair value. Investments in equity securities traded on a national securities exchange are valued at the composite close price, as reported in the Wall Street Journal, as of the financial statement date. This information is provided by the independent pricing sources.

Short-term investments are primarily cash related to funding of the plan which had yet to be invested as of balance sheet dates.

Certain corporate and government bonds are valued at the closing price reported in the active market in which the bond is traded. Other bonds are valued based on yields currently available on comparable securities of issuers with similar credit ratings. When quoted prices are not available for identical or similar bonds, the bond is valued under a discounted cash flow approach that maximizes observable inputs, such as current yields of similar instruments, but includes adjustments for certain risks that may not be observable, such as credit and liquidity risks. All bonds are priced by independent pricing sources.

Assets measured at net asset value include investments in limited partnerships, which are stated at the fair value of the plan’s partnership interest based on information supplied by the partnerships as compared to financial statements of the limited partnership or other fair value information as determined by management. Cash equivalents or short-term investments are stated at cost which approximates fair value, and the fair value of common/collective trusts is determined based on net asset value as reported by their fund managers.

Following is the asset allocation under the qualified pension plan as of the valuation date for the fiscal years presented:

			January 28, 2023			January 29, 2022
Return-seeking assets			46%			45%
Liability-hedging assets			54%			55%
All other – primarily cash			—%			—%

F-26

Under TJX’s investment policy, qualified pension plan assets are to be invested with the objective of generating investment returns that, in combination with funding contributions, provide adequate assets to meet all current and reasonably anticipated future benefit obligations under the plan. The investment policy includes a dynamic asset allocation strategy, whereby, over time, in connection with improvements in the plan’s funded status, the target allocation of return-seeking assets (generally, equities and other instruments with a similar risk profile) may decline and the target allocation of liability-hedging assets (generally, fixed income and other instruments with a similar risk profile) may increase. Under the investment policy guidelines, the target asset allocation of return-seeking assets and liability-hedging assets was 44% and 56%, respectively, as of January 28, 2023. Risks are sought to be mitigated through asset diversification and the use of multiple investment managers. Investment risk is measured and monitored on an ongoing basis through investment portfolio reviews, annual liability measurements and periodic asset/liability studies.

Other Retirement Benefits

TJX also sponsors an employee savings plan under Section 401(k) of the Internal Revenue Code for eligible U.S. employees and a similar type of plan for eligible employees in Puerto Rico. Employees may contribute up to 50% of eligible pay, subject to limitations. For eligible employees who have completed the applicable service requirement, TJX matches employee contributions, up to 5% of eligible pay, including a basic match at rates of 25% or 75% (based upon date of hire and other eligibility criteria) plus a discretionary match, generally up to 25%, based on TJX’s performance. TJX may also make additional discretionary contributions. Certain eligible employees are automatically enrolled in the U.S. Plan and the Puerto Rico savings plan at a 2% deferral rate, unless the employee elects otherwise. The total cost of TJX contributions to these plans was $77 million in fiscal 2023, $83 million in fiscal 2022 and $61 million in fiscal 2021.

TJX also has a nonqualified savings plan (the Executive Savings Plan) for certain U.S. employees. TJX matches employee deferrals at various rates which amounted to $6 million in fiscal 2023, $7 million in fiscal 2022 and $3 million in fiscal 2021. Although the plan is unfunded, in order to help meet its future obligations TJX transfers an amount generally equal to employee deferrals and the related company match to a separate “rabbi” trust. The trust assets, which are invested in a variety of mutual funds, are included in other assets on the balance sheets.

In addition to the plans described above, TJX also contributes to retirement/deferred savings programs for eligible Associates at certain of its foreign subsidiaries. The Company contributed $29 million for these programs in fiscal 2023, $26 million for these programs in fiscal 2022 and $22 million in fiscal 2021.

Multiemployer Pension Plans

TJX contributes to certain multiemployer defined benefit pension plans under the terms of collective-bargaining agreements that cover union-represented employees. TJX contributed $25 million in both fiscal 2023 and fiscal 2022, and $19 million in fiscal 2021 to the Legacy Plan of the National Retirement Fund (EIN #13-6130178, plan #1), the Adjustable Plan of the National Retirement Fund (EIN #13-6130178, plan #2), the Legacy Plan of the UNITE HERE Retirement Fund (EIN #82-0994119, plan #1) and the Adjustable Plan of the UNITE HERE Retirement Fund (EIN #82-0994119, plan #2). TJX was listed in the Form 5500 for the Legacy Plan of the National Retirement Fund, the Adjustable Plan of the National Retirement Fund, and the Legacy Plan of the UNITE HERE Retirement Fund as providing more than 5% of the total contributions for the plan year ending December 31, 2021. In addition, based on information available to TJX, the Pension Protection Act Zone status for the Legacy Plan of the National Retirement Fund is critical and for the Legacy Plan of the UNITE HERE Retirement Fund is critical and declining, and rehabilitation plans have been adopted by these plans.

The risks of participating in multiemployer pension plans are different from the risks of single-employer pension plans in certain respects, including the following: (a) assets contributed to the multiemployer plan by one employer may be used to provide benefits to employees of other participating employers; (b) if a participating employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers; (c) if TJX ceases to have an obligation to contribute to a multiemployer plan in which the Company had been a contributing employer, or in certain other circumstances, the Company may be required to pay to the plan an amount based on the Company’s allocable share of the underfunded status of the plan, referred to as a withdrawal liability.

F-27

Note J. Long-Term Debt and Credit Lines

The table below presents long-term debt as of January 28, 2023 and January 29, 2022. All amounts are net of unamortized debt discounts.

In millions and net of immaterial unamortized debt discount			January 28, 2023			January 29, 2022
General corporate debt:
2.500% senior unsecured notes, maturing May 15, 2023 (effective interest rate of 2.51% after reduction of unamortized debt discount)			$	500		$	500
2.250% senior unsecured notes, maturing September 15, 2026 (effective interest rate of 2.32% after reduction of unamortized debt discount)			997			997
1.150% senior unsecured notes, maturing May 15, 2028 (effective interest rate of 1.18% after reduction of unamortized debt discount)			499			499
3.875% senior unsecured notes, maturing April 15, 2030 (effective interest rate of 3.89% after reduction of unamortized debt discount)			496			495
1.600% senior unsecured notes, maturing May 15, 2031 (effective interest rate of 1.61% after reduction of unamortized debt discount)			500			500
4.500% senior unsecured notes, maturing April 15, 2050 (effective interest rate of 4.52% after reduction of unamortized debt discount)			383			383
Total debt			3,375			3,374
Current maturities of long-term debt, net of debt issuance costs			(500)			—
Debt issuance costs			(16)			(19)
Long-term debt			$	2,859		$	3,355

The aggregate maturities of long-term debt, inclusive of current installments at January 28, 2023 are as follows:

In millions
Fiscal Year:
2024			$	500
2025			—
2026			—
2027			1,000
2028			—
Later years			1,881
Unamortized debt discount			(6)
Debt issuance costs			(16)
Less: current maturities of long-term debt			(500)
Aggregate maturities of long-term debt			$	2,859

Senior Unsecured Notes

As of January 28, 2023, TJX had outstanding $1 billion aggregate principal amount of 2.250% ten-year Notes due September 2026 and $500 million aggregate principal amount of 2.500% ten-year Notes due May 2023. TJX entered into a rate-lock agreement to hedge $700 million of the 2.250% notes and $250 million of the 2.500% notes prior to their issuance. The cost of these agreements is being amortized to interest expense over the term of the notes resulting in an effective fixed rate of 2.36% for the 2.25% notes and 2.57% for the 2.50% notes.

F-28

Credit Facilities

TJX has two revolving credit facilities, a $1 billion senior unsecured revolving credit facility maturing in June 2026 (the “2026 Revolving Credit Facility”) and a $500 million revolving credit facility that matures in May 2024 (the “2024 Revolving Credit Facility”). Under these credit facilities, the Company has maintained a borrowing capacity of $1.5 billion. The terms of these revolving credit facilities require quarterly payments on the committed amount and payment of interest on borrowings at rates based on LIBOR or a base rate plus a variable margin, in each case based on the Company’s long-term debt ratings. The 2024 Revolving Credit Facility requires usage fees based on total credit extensions under the facility. As of January 28, 2023 and January 29, 2022, there were no amounts outstanding under these facilities. Each of these facilities require TJX to maintain a ratio of funded debt to earnings before interest, taxes, depreciation and amortization and rentals (EBITDAR) of not more than 3.50 to 1.00 on a rolling four-quarter basis. TJX was in compliance with all covenants related to its credit facilities at the end of all periods presented.

As of January 28, 2023 and January 29, 2022, TJX Canada had two uncommitted credit lines, a C$10 million facility for operating expenses and a C$10 million letter of credit facility. As of January 28, 2023 and January 29, 2022, and during the years then ended, there were no amounts outstanding on the Canadian credit lines for operating expenses. As of January 28, 2023 and January 29, 2022, the Company’s European business at TJX International had an uncommitted credit line of £5 million. As of January 28, 2023 and January 29, 2022, and during the years then ended, there were no amounts outstanding on the European credit line.

Note K. Income Taxes

In August 2022, the Inflation Reduction Act of 2022 (IRA) was signed into law. Among other things, the IRA imposes a 15% corporate alternative minimum tax (the “Corporate AMT”) for tax years beginning after December 31, 2022 and levies a 1% excise tax on net stock repurchases after December 31, 2022. The excise tax on the net stock repurchase portion of the IRA did not have an impact on our results of operations or financial position in fiscal 2023 and the Company does not expect the Corporate AMT, excise tax, or other provisions of the IRA to have a material impact on its consolidated financial statements.

For financial reporting purposes, components of income before income taxes are as follows:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
United States			$	4,029		$	3,934		$	642
Foreign			607			464			(553)
Income before income taxes			$	4,636		$	4,398		$	89

The provision (benefit) for income taxes includes the following:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Current:
Federal			$	656		$	766		$	190
State			233			271			36
Foreign			185			122			5
Deferred:
Federal			52			(32)			(98)
State			0			(26)			(25)
Foreign			12			14			(109)
Provision (benefit) for income taxes			$	1,138		$	1,115		$	(1)

F-29

TJX had net deferred tax assets (liabilities) as follows:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022
Deferred tax assets:
Net operating loss carryforward			$	156		$	159
Pension, stock compensation, postretirement and employee benefits			326			368
Operating lease liabilities			2,500			2,379
Accruals and reserves			245			237
Other			14			13
Total gross deferred tax assets			$	3,241		$	3,156
Valuation allowance			(86)			(85)
Total deferred tax asset			$	3,155		$	3,071
Deferred tax liabilities:
Property, plant and equipment			$	628		$	553
Capitalized inventory			61			48
Operating lease right of use assets			2,404			2,289
Tradename/intangibles			21			19
Undistributed foreign earnings			5			9
Other			5			12
Total deferred tax liabilities			$	3,124		$	2,930
Net deferred tax asset			$	31		$	141
Non-current asset			$	158		$	185
Non-current liability			(127)			(44)
Total			$	31		$	141

TJX has provided for all applicable state and foreign withholding taxes on all undistributed earnings of its foreign subsidiaries in Canada, Puerto Rico, Italy, India, Hong Kong and Vietnam through January 28, 2023. The Company has not provided for federal, state, or foreign withholding taxes on the approximately $1.2 billion of undistributed earnings related to all other foreign subsidiaries as such earnings are considered to be indefinitely reinvested in the business. The net amount of unrecognized state and foreign withholding tax liabilities related to the undistributed earnings is not material.

As of January 28, 2023 and January 29, 2022, for state income tax purposes, TJX had net operating loss carryforwards of $328 million and $291 million respectively, which expire, if unused, in the years 2024 through 2043. TJX has analyzed the realization of the state net operating loss carryforwards on an individual state basis. For those states where the Company has determined that it is more likely than not that the state net operating loss carryforwards will not be realized, a valuation allowance of $16 million has been provided for the deferred tax asset as of January 28, 2023 and $14 million as of January 29, 2022.

The Company had available for foreign income tax purposes (related to Australia, Austria, Germany, the Netherlands, Poland and the U.K.) net operating loss carryforwards of $508 million as of January 28, 2023 and $534 million as of January 29, 2022. The full amount of the loss carryforwards do not expire. For the deferred tax assets associated with the net operating loss carryforwards for which management has determined it is more likely than not that the deferred tax assets will not be realized, TJX had valuation allowances recorded of approximately $71 million as of both January 28, 2023 and January 29, 2022.

F-30

The difference between the U.S. federal statutory income tax rate and TJX’s worldwide effective income tax rate is reconciled below:

			Fiscal Year Ended
			January 28, 2023			January 29, 2022			January 30, 2021
U.S. federal statutory income tax rate			21.0		%	21.0		%	21.0		%
Effective state income tax rate			4.3			4.6			28.1
Impact of foreign operations			1.1			0.9			21.4
Excess share-based compensation			(1.0)			(1.2)			(59.4)
Tax credits			(0.3)			(0.3)			(8.9)
Nondeductible/nontaxable items			(0.1)			0.2			(3.3)
All other			(0.5)			0.2			(0.3)
Worldwide effective income tax rate			24.5		%	25.4		%	(1.4)		%

TJX’s effective income tax rate decreased for fiscal 2023 compared to fiscal 2022. The decrease in the fiscal 2023 effective income tax rate is primarily due to the lapse of statutes of limitations and resolution of various tax matters, and the change of jurisdictional mix of profits and losses, partially offset by a reduction of excess tax benefits from share-based compensation.

TJX had net unrecognized tax benefits of $265 million as of January 28, 2023, $288 million as of January 29, 2022 and $272 million as of January 30, 2021.

A reconciliation of the beginning and ending gross amount of unrecognized tax benefits is as follows:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Balance, beginning of year			$	280		$	269		$	259
Additions for uncertain tax positions taken in current year			8			10			12
Additions for uncertain tax positions taken in prior years			7			3			1
Reductions for uncertain tax positions taken in prior years			(2)			—			—
Reductions resulting from lapse of statute of limitations			(18)			(2)			(3)
Settlements with tax authorities			(9)			—			0
Balance, end of year			$	266		$	280		$	269

Included in the gross amount of unrecognized tax benefits are items that will impact future effective tax rates upon recognition. These items amounted to $251 million as of January 28, 2023, $260 million as of January 29, 2022 and $250 million as of January 30, 2021.

TJX is subject to U.S. federal income tax as well as income tax in multiple state, local and foreign jurisdictions. In the U.S. and India, fiscal years through 2010 are no longer subject to examination. In all other jurisdictions, fiscal years through 2011 are no longer subject to examination.

TJX’s accounting policy is to classify interest and penalties related to income tax matters as part of income tax expense. The amount of interest and penalties expensed was $7 million for both of the fiscal years ended January 28, 2023 and January 29, 2022, and $8 million for the fiscal year ended January 30, 2021. The accrued amounts for interest and penalties are $37 million as of January 28, 2023, $43 million as of January 29, 2022 and $36 million as of January 30, 2021.

Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statutes of limitations in specific jurisdictions or other resolutions of, or changes in, tax positions, it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those represented on the consolidated financial statements as of January 28, 2023. During the next twelve months, it is reasonably possible that tax audit resolutions may reduce unrecognized tax benefits by up to $52 million, which would reduce the provision for taxes on earnings.

F-31

Note L. Leases

TJX is committed under long-term leases related to its continuing operations for the rental of real estate and certain service contracts containing embedded leases, all of which are operating leases. Real estate leases represent virtually all of the Company’s store locations as well as some of its distribution centers and office space. Most of TJX’s leases in the U.S. and Canada are store operating leases with ten-year terms and options to extend for one or more five-year periods. Leases in Europe generally have an initial term of ten to fifteen years and leases in Australia generally have an initial lease term of primarily seven to ten years, some of which have options to extend. Many of the Company's leases have options to terminate prior to the lease expiration date. The exercise of both lease renewal and termination options is at the Company’s sole discretion, as opposed to the landlord’s discretion, and is not reasonably certain at lease commencement. The Company has deemed that the expense of store renovations makes the renewal of the next lease option reasonably certain to be exercised after these renovations occur.

While the overwhelming majority of leases have fixed payment schedules, some leases have variable lease payments based on market indices adjusted periodically for inflation, or include rental payments based on a percentage of retail sales over contractual levels. In addition, for real estate leases, TJX is generally required to pay insurance, real estate taxes and certain other expenses including common area maintenance based on a proportionate share of premises as compared to the shopping center, and some of these costs are based on a market index, primarily in Canada. For leases with these payments based on a market index, the initial lease payment amount is used in the calculation of the operating lease liability and corresponding operating lease assets included on the Consolidated Balance Sheets. Future payment changes to these market index rate leases are not reflected in the operating lease liability and are instead included in variable lease cost. Variable lease cost also includes variable operating expenses for third party service centers and dedicated transportation contracts that are deemed embedded leases. The operating lease ROU assets also includes any lease payments made in advance of the assets’ use and is reduced by lease incentives received. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

Supplemental balance sheet information related to leases is as follows:

			Fiscal Year Ended
			January 28, 2023			January 29, 2022
Weighted-average remaining lease term			6.5 years			6.6 years
Weighted-average discount rate			2.7		%	2.4		%

The following table is a summary of the Company’s components of net lease cost for the fiscal years ended:

						Fiscal Year Ended
In millions			Classification			January 28, 2023			January 29, 2022			January 30, 2021
Operating lease cost			Cost of sales, including buying and occupancy costs			$	1,927		$	1,906		$	1,820
Variable and short term lease cost			Cost of sales, including buying and occupancy costs			1,359			1,386			1,163
Total lease cost						$	3,286		$	3,292		$	2,983

Supplemental cash flow information related to leases is as follows:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows paid for operating leases			$	1,949		$	2,080		$	1,663
Lease liabilities arising from obtaining right of use assets			$	2,095		$	1,658		$	1,380

During fiscal 2022, the Company repaid the rent deferrals that had been negotiated due to the COVID-19 pandemic in fiscal 2021 for a significant number of its stores.

F-32

The following table as of January 28, 2023 summarizes the maturity of lease liabilities under operating leases:

In millions
Fiscal Year:
2024			$	1,977
2025			1,825
2026			1,628
2027			1,402
2028			1,111
Later years			2,323
Total lease payments(a)			10,266
Less: imputed interest(b)			881
Total lease liabilities(c)			$	9,385

(a)Operating lease payments exclude legally binding minimum lease payments for leases signed but not yet commenced and include options to extend lease terms that are now deemed reasonably certain of being exercised according to the Company’s Lease Accounting Policy.

(b)Calculated using the incremental borrowing rate for each lease.

(c)Total lease liabilities are broken out on the Consolidated Balance Sheets between Current portion of operating lease liabilities and Long-term operating lease liabilities.

Note M. Accrued Expenses and Other Liabilities, Current and Long Term

The major components of accrued expenses and other current liabilities are as follows:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022
Employee compensation and benefits, current			$	968		$	1,117
Merchandise credits and gift certificates			721			685
Sales tax collections and V.A.T. taxes			384			268
Occupancy costs, including rent, utilities and real estate taxes			378			399
Dividends payable			346			312
Accrued capital additions			199			186
All other current liabilities			1,350			1,278
Total accrued expenses and other current liabilities			$	4,346		$	4,245

All other current liabilities include accruals for expense payables, insurance, customer rewards liability, reserve for sales returns, reserve for taxes, fair value of derivatives, advertising, interest and other items, each of which is individually less than 5% of current liabilities.

The major components of other long-term liabilities are as follows:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022
Employee compensation and benefits, long-term			$	597		$	647
Tax reserve, long-term			235			277
Asset retirement obligation			66			66
All other long-term liabilities			21			25
Total other long-term liabilities			$	919		$	1,015

F-33

Note N. Contingent Obligations, Contingencies, and Commitments

Contingent Contractual Obligations

TJX is a party to various agreements under which it may be obligated to indemnify the other party with respect to certain losses related to matters including title to assets sold, specified environmental matters or certain income taxes. These obligations are sometimes limited in time or amount. There are no amounts reflected in the Company’s Consolidated Balance Sheets with respect to these contingent obligations.

Legal Contingencies

TJX is subject to certain legal proceedings, lawsuits, disputes and claims that arise from time to time in the ordinary course of its business. TJX has accrued immaterial amounts in the accompanying Consolidated Financial Statements for certain of its legal proceedings.

Letters of Credit

TJX had outstanding letters of credit totaling $42 million as of January 28, 2023 and $53 million as of January 29, 2022. Letters of credit are issued by TJX primarily for the purchase of inventory.

Note O. Supplemental Cash Flow Information

TJX’s cash payments for interest and income taxes and non-cash investing and financing activities are as follows:

			Fiscal Year Ended
In millions			January 28, 2023			January 29, 2022			January 30, 2021
Cash paid for:
Interest on debt(a)			$	86		$	139		$	153
Income taxes			1,225			1,119			146
Non-cash investing and financing activity:
Dividends payable			$	34		$	(3)		$	34
Property additions			13			97			(36)

(a)Decreased interest for fiscal 2023 was due to the pay down of outstanding debt during fiscal 2022.

F-34