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Document and Entity Information	6 Months Ended
Document and Entity Information	Jul. 01, 2017 shares
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 01, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	Q2
Trading Symbol	ODP
Entity Registrant Name	OFFICE DEPOT INC
Entity Central Index Key	0000800240
Current Fiscal Year End Date	--12-30
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	518,406,220

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Sales	$ 2,363	$ 2,583	$ 5,039	$ 5,459
Cost of goods sold and occupancy costs	1,818	1,970	3,819	4,132
Gross profit	545	613	1,220	1,327
Selling, general and administrative expenses	478	535	1,006	1,125
Asset impairments	1		1
Merger, restructuring, and other operating (income) expenses, net	20	(193)	40	(154)
Operating income	46	271	173	356
Other income (expense):
Interest income	6	6	12	11
Interest expense	(14)	(23)	(27)	(44)
Other expense, net	(3)		(2)
Income from continuing operations before income taxes	35	254	156	323
Income tax expense	14	22	61	29
Net income from continuing operations	21	232	95	294
Discontinued operations, net of tax	3	(22)	45	(38)
Net income	$ 24	$ 210	$ 140	$ 256
Basic earnings (loss) per share
Continuing operations	$ 0.04	$ 0.42	$ 0.18	$ 0.53
Discontinued operations	0.01	(0.04)	0.09	(0.07)
Net earnings per share	0.05	0.38	0.27	0.47
Diluted earnings (loss) per share
Continuing operations	0.04	0.41	0.18	0.53
Discontinued operations	0.01	(0.04)	0.08	(0.07)
Net diluted earnings per share	0.05	$ 0.38	0.26	$ 0.46
Dividends per common share	$ 0.025		$ 0.050

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Net income	$ 24	$ 210	$ 140	$ 256
Other comprehensive income, net of tax where applicable:
Foreign currency translation adjustments	12	4	18	12
Reclassification of foreign currency translation adjustments realized upon disposal of business	5		5
Other		1		(1)
Total other comprehensive income, net of tax, where applicable	17	5	23	11
Comprehensive income	$ 41	$ 215	$ 163	$ 267

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions	Jul. 01, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 763	$ 763
Receivables, net	652	687
Inventories	1,228	1,279
Prepaid expenses and other current assets	116	102
Current assets of discontinued operations	153	142
Total current assets	2,912	2,973
Property and equipment, net	580	601
Goodwill	363	363
Other intangible assets, net	32	33
Timber notes receivable	874	885
Deferred income taxes	425	466
Other assets	226	219
Total assets	5,412	5,540
Current liabilities:
Trade accounts payable	873	893
Accrued expenses and other current liabilities	855	1,002
Income taxes payable	2	3
Short-term borrowings and current maturities of long-term debt	28	29
Current liabilities of discontinued operations	69	104
Total current liabilities	1,827	2,031
Deferred income taxes and other long-term liabilities	338	361
Pension and postretirement obligations, net	138	140
Long-term debt, net of current maturities	347	358
Non-recourse debt	787	798
Total liabilities	3,437	3,688
Commitments and contingencies
Stockholders' equity:
Common stock-authorized 800,000,000 shares of $.01 par value; issued shares - 564,967,006 at July 1, 2017 and 557,892,568 at December 31, 2016	6	6
Additional paid-in capital	2,596	2,618
Accumulated other comprehensive loss	(106)	(129)
Accumulated deficit	(314)	(453)
Treasury stock, at cost - 46,560,786 shares at July 1, 2017 and 42,802,998 shares at December 31, 2016	(207)	(190)
Total stockholders' equity	1,975	1,852
Total liabilities and stockholders' equity	$ 5,412	$ 5,540

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jul. 01, 2017	Dec. 31, 2016
Common stock, authorized	800,000,000	800,000,000
Common stock, par value	$ 0.01	$ 0.01
Common stock, issued shares	564,967,006	557,892,568
Treasury stock, shares	46,560,786	42,802,998

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Cash flows from operating activities of continuing operations:
Net income	$ 24	$ 210	$ 140	$ 256
Income (loss) from discontinued operations, net of tax	3	(22)	45	(38)
Net income from continuing operations	21	232	95	294
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			79	97
Charges for losses on inventories and receivables			35	30
Asset impairments	1		1
Compensation expense for share-based payments			17	14
Deferred income taxes			42	2
Changes in working capital and other			(154)	(189)
Net cash provided by operating activities of continuing operations			115	248
Cash flows from investing activities of continuing operations:
Capital expenditures			(55)	(45)
Proceeds from disposition of assets and other			33	11
Net cash used in investing activities of continuing operations			(22)	(34)
Cash flows from financing activities of continuing operations:
Net payments on long and short-term borrowings			(15)	(34)
Debt related fees				(6)
Cash dividends on common stock	(13)		(26)
Share purchase for taxes, net of proceeds on employee-related plans			(14)	1
Repurchase of common stock for treasury			(17)	(26)
Net cash used in financing activities of continuing operations			(72)	(65)
Cash flows from discontinued operations:
Operating activities of discontinued operations			21	(100)
Investing activities of discontinued operations			(26)	(3)
Financing activities of discontinued operations			(8)	2
Net cash used in discontinued operations			(13)	(101)
Effect of exchange rate changes on cash and cash equivalents			5	1
Net increase in cash and cash equivalents			13	49
Cash and cash equivalents at beginning of period			807	1,069
Cash and cash equivalents at end of period-total	820	1,118	820	1,118
Cash and cash equivalents of discontinued operations	(57)	(104)	(57)	(104)
Cash and cash equivalent at end of the period-continuing operations	$ 763	$ 1,014	$ 763	$ 1,014

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Jul. 01, 2017

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

Office Depot, Inc., including consolidated subsidiaries (“Office Depot” or the “Company”), is a provider of office supplies, business products and services delivered through an omnichannel platform. The Company currently operates under several banners, including Office Depot ^® and OfficeMax ^® and utilizes proprietary company and product brand names. The Company’s common stock is traded on the NASDAQ Global Select Market under the ticker symbol “ODP.” As of July 1, 2017, the Company sold to customers through two reportable segments (or “Divisions”): Retail Division and Business Solutions Division.

In September 2016, the Company’s Board of Directors committed to a plan to sell substantially all of the Company’s International Division operations (the “International Operations”). Accordingly, the Company has presented the International Operations as discontinued operations beginning in the third quarter 2016. The Company has reclassified the financial results of the International Operations to Discontinued operations, net of tax in the Condensed Consolidated Statements of Operations for all periods presented. The Company also classified the related assets and liabilities as current assets and liabilities of discontinued operations on the accompanying Condensed Consolidated Balance Sheets as of July 1, 2017, and December 31, 2016. Cash flows from the Company’s discontinued operations are presented in the Condensed Consolidated Statements of Cash Flows for all periods. Certain portions of the International Division assets and operations are being retained or did not meet the held for sale criteria and therefore remain in continuing operations, with prior periods adjusted, where appropriate. Additional information on the dispositions is provided in Note 3.

The Condensed Consolidated Financial Statements as of July 1, 2017, and for the 13-week and 26-week periods ended July 1, 2017 (also referred to as “the second quarter of 2017” and “the first half of 2017,” respectively) and June 25, 2016 (also referred to as “the second quarter of 2016” and “the first half of 2016,” respectively) are unaudited. However, in management’s opinion, these condensed consolidated financial statements reflect all adjustments of a normal recurring nature necessary to provide a fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented.

The Company has prepared the Condensed Consolidated Financial Statements included herein pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Some information and note disclosures, which would normally be included in comprehensive annual financial statements prepared in accordance with accounting principles generally accepted in the United States, have been condensed or omitted pursuant to those SEC rules and regulations. For a better understanding of the Company and its Condensed Consolidated Financial Statements, we recommend reading these Condensed Consolidated Financial Statements in conjunction with the audited financial statements which are included in the 2016 Form 10-K. These interim results are not necessarily indicative of the results that should be expected for the full year.

Cash Management

The cash management process generally utilizes zero balance accounts which provide for the settlement of the related disbursement and cash concentration accounts on a daily basis. Trade accounts payable and Accrued expenses and other current liabilities as of July 1, 2017 and December 31, 2016, included $44 million and $58 million, respectively, of amounts not yet presented for payment drawn in excess of disbursement account book balances, after considering offset provisions.

At July 1, 2017, cash and cash equivalents from continuing operations but held outside the United States amounted to $134 million. Additionally, $57 million of cash held outside the United States was included in current assets of discontinued operations.

New Accounting Standards

Standards that are not yet adopted

In May 2014, the Financial Accounting Standards Board (“FASB”) issued an accounting standards update that supersedes most current revenue recognition guidance and modifies the accounting for certain costs associated with revenue generation. The core principle of this guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides a number of steps to apply to achieve that principle and requires additional disclosures. The standard was originally to be effective for the Company’s first quarter of 2017. In July 2015, the FASB approved a one year extension to the required implementation date but also permitted companies to adopt the standard at the original effective date of 2017. The new revenue recognition standard may be applied retrospectively to each prior period presented or modified retrospectively with the cumulative effect recognized as of the date of adoption.

The Company continues to assess the impact this new standard will have on its Consolidated Financial Statements and has not yet decided on which adoption alternative to apply upon adoption in the first quarter of 2018. However, based on its ongoing assessment, the Company expects that the new standard will require the impacts of its loyalty programs to be presented as a reduction of revenue, rather than as cost accruals as is permitted under existing accounting rules. Additionally, the timing of revenue recognition will be accelerated for items where the Company’s performance obligation is complete, such as certain commission arrangements, and delayed where performance obligations remain, such as certain coupons and incentives offered from time-to-time. The Company also continues to assess its disclosure requirements related to this new standard and changes that may be necessary to the Company’s systems and internal controls over financial reporting. The Company will adopt the standard in the first quarter of 2018, and does not expect the adoption of the new standard to materially affect its consolidated net income, cash flows or financial position.

In February 2016, the FASB issued an accounting standards update which will require lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The accounting treatment for lessors will remain relatively unchanged. The accounting standards update also requires additional qualitative and quantitative disclosures related to the nature, timing and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. Lessees and lessors are required to use a modified retrospective transition method for existing leases and accordingly, apply the new accounting model for the earliest year presented in the financial statements. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements but anticipates it will result in significant right of use assets and related liabilities associated with its operating leases being recorded on its balance sheet. Substantially all of the Company’s retail store locations and supply chain facilities are subject to operating lease arrangements. The Company will adopt the standard in the first quarter of 2019, and has begun implementing required upgrades to its existing lease systems.

In March 2017, the FASB issued an accounting standards update which changes the income statement presentation of defined benefit plan expense by requiring that an employer report the service cost component of pension costs in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit pension cost will be presented in the income statement separately from the service cost component and outside a subtotal of operating income. Employers will have to disclose the line(s) used to present the other components of net periodic benefit cost, if the components are not presented separately in the income statement. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. The Company expects the adoption of this accounting standard update to reduce operating income by approximately $13 million on an annual basis, but have no impact on net income.

Standards that were adopted

During the first quarter of 2017, the Company adopted the new accounting standard which modifies several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows of certain tax benefits or deficiencies and employee tax withholdings, as well as the accounting for award forfeitures over the vesting period. Starting in the first quarter of 2017, stock-based compensation excess tax benefits or deficiencies are reflected in the Consolidated Statements of Operations as a component of the provision for income taxes, whereas they previously were recognized in equity. Additionally, the Consolidated Statements of Cash Flows now present excess tax benefits as an operating activity, which was applied prospectively in accordance with the standard and therefore prior periods have not been adjusted. Finally, the Company has elected to account for forfeitures as they occur rather than estimate expected forfeitures, which was applied on a modified retrospective basis, resulting in a cumulative effect that increased accumulated deficit by approximately $1 million as of January 1, 2017.

MERGER, ACQUISITION TERMINATION, AND RESTRUCTURING ACTIVITY

6 Months Ended

Jul. 01, 2017

MERGER, ACQUISITION TERMINATION, AND RESTRUCTURING ACTIVITY

NOTE 2. MERGER, ACQUISITION TERMINATION, AND RESTRUCTURING ACTIVITY

In recent years, the Company has taken actions to adapt to changing and competitive market conditions. These actions include closing facilities, consolidating functional activities, eliminating redundant positions, disposing of businesses and assets, and taking actions to improve process efficiencies.

Merger and Restructuring

In 2013, the OfficeMax merger (the “Merger”) was completed and integration activities similar to the actions described above began. The Company also assumed certain restructuring liabilities previously recorded by OfficeMax. In mid-2014, the Company’s real estate strategy (the “Real Estate Strategy”) identified 400 retail stores for closure through 2016 along with planned changes associated with the integration of the two companies’ supply chains. During the second quarter of 2016, the Company completed the retail store closures under this program. Changes to the Company’s supply chain related to the Merger are anticipated to be substantially complete by the end of 2017.

Staples Acquisition and Merger Agreement Termination

On February 4, 2015, Staples, Inc. (“Staples”) and the Company announced that the companies entered into a definitive merger agreement (the “Staples Merger Agreement”), under which Staples would acquire all of the outstanding shares of Office Depot and the Company would become a wholly owned subsidiary of Staples (the “Staples Acquisition”).

On May 10, 2016, the U.S. District Court for the District of Columbia granted the United States Federal Trade Commission’s request for a preliminary injunction against the proposed acquisition, and as a result, the companies terminated the Staples Merger Agreement on May 16, 2016. Per the terms of the termination agreement, Staples paid Office Depot a fee of $250 million in cash (“Termination Fee”) on May 19, 2016, which is included in Merger, restructuring and other operating (income) expenses, net in the Condensed Consolidated Statements of Operations for the second quarter and first half of 2016 and in Net cash provided by operating activities of continuing operations in the Condensed Consolidated Statements of Cash Flows for 2016.

Comprehensive Business Review

During August 2016, the Company announced the results of a comprehensive business review (the “Comprehensive Business Review”), which, among other things, includes a plan to close approximately 300 additional retail stores in North America over a three-year period, and to lower operating and general and administrative expenses through efficiencies and organizational optimization. The Company estimates it will incur up to approximately $125 million in costs to implement the cost savings programs, of which $75 million has been incurred in 2016 and through the first half of 2017. The remaining costs are expected to be incurred through the end of 2017, excluding costs related to planned store closures, which will be recognized over the next two years. The significant components of expenses incurred by the Company relating to its cost saving programs activities are discussed below.

Merger, restructuring, and other operating (income) expenses, net

The Company presents Merger, restructuring and other operating (income) expenses, net on a separate line in the Condensed Consolidated Statements of Operations to identify these activities apart from the activities to sell to and service its customers. These expenses are not allocated to the Company’s divisions for the purpose of calculating their operating income. The table below and narrative that follow provide the major components of Merger, restructuring and other operating (income) expenses, net.


	Second Quarter						First Half
(In millions)	2017			2016			2017		2016
Merger related (income) expenses
Transaction and integration	$	5		$	11		$	11	$	22
Facility closure, contract termination, and other expenses, net		(2	)		14			2		17

Total Merger related expenses		3			25			13		39

Staples Acquisition (income) expenses
Retention		—			13			—		15
Transaction		—			18			—		38
Termination Fee		—			(250	)		—		(250	)

Total Staples Acquisition income		—			(219	)		—		(197	)

Comprehensive Business Review and other restructuring expenses
Severance		6			1			15		4
Facility closure, contract termination, professional fees and other expenses, net		11			—			12		—

Total Comprehensive Business Review and other restructuring expenses		17			1			27		4

Total Merger, restructuring and other operating (income) expenses, net	$	20		$	(193	)	$	40	$	(154	)

Merger related (income) expenses

Transaction and integration expenses include integration-related professional fees, incremental temporary contract labor, salary and benefits for employees dedicated to the Merger activity, travel costs, non-capitalizable software integration costs, and other direct costs to combine the companies. Such costs are being recognized as incurred.

Facility closure, contract termination, and other expenses, net primarily relate to facility closure accruals, contract termination cost, gains and losses on asset dispositions, and accelerated depreciation. Facility closure expenses include amounts incurred by the Company to close retail stores in the United States as part of the Real Estate Strategy, as well as supply chain facilities. During the second quarter and first half of 2017, the Company recognized gains of $5 million and $6 million, respectively, from the sale of warehouse facilities that had been classified as assets held for sale. During the second quarter and first half of 2016, the Company recognized gains of $1 million from the sale of warehouse facilities that had been classified as assets held for sale. The gains are included in Merger, restructuring and other operating (income) expenses, net, as the dispositions were part of the supply chain integration associated with the Merger.

Staples Acquisition (income) expenses

Expenses incurred in 2016 include retention accruals and transaction costs, including costs associated with regulatory filings and professional fees, offset by the Termination Fee income. The Staples Merger Agreement was terminated on May 16, 2016, and no further expenses are expected.

Comprehensive Business Review and other restructuring expenses

Expenses associated with implementing the Comprehensive Business Review include severance, facility closure costs, contract termination, accelerated depreciation, professional fees, relocation and disposal gains and losses, as well as other costs associated with the store closures. The Company has completed 105 of the planned 300 retail store closures since announcing this initiative, with the remaining stores expected to be closed over the next two years. Severance costs related to planned store closures are being accrued through the anticipated facility closure or termination date and consider timing, terms of existing severance plans, expected employee turnover and attrition. Restructuring expenses also include severance and reorganization costs associated with reductions in staff functions that continued into 2017.

In the second quarter and first half of 2016, the Company incurred $1 million and $4 million, respectively, of severance expense associated with the restructuring of certain selling activities in advance of the Comprehensive Business Review.

Merger and Restructuring Accruals

The activity in the merger and restructuring accruals is presented in the table below. Of the total $40 million expense above presented in Merger, restructuring and other operating (income) expenses, net incurred in the first half of 2017, $28 million relates to Merger and restructuring liabilities and are included as charges incurred in the table below. The remaining $12 million expense is comprised of $11 million in Merger transaction and integration expenses and $7 million in property expenses, professional fees, non-cash items and other expenses, partially offset by a $6 million gain on the disposition of warehouse facilities which were part of the supply chain integration associated with the Merger. These remaining amounts are excluded from the table below because they are charges that are recorded and paid in the same period.


			First Half of 2017
(In millions)	Balance as of December 31, 2016		Charges Incurred		Cash Payments			Lease Accretion and Other Adjustments			Balance as of July 1, 2017
Termination benefits
Merger related accruals	$	5	$	—	$	(3	)	$	—		$	2
Comprehensive Business Review		8		15		(17	)		—			6
Lease and contract obligations, accruals for facilities closures and other costs:
Merger related accruals		40		4		(18	)		—			26
Comprehensive Business Review		13		8		(8	)		—			13
Other restructuring accruals		5		1		(2	)		2			6
Acquired entity store closure accruals		18		—		(4	)		(1	)		13

Total	$	89	$	28	$	(52	)	$	1		$	66

The short-term and long-term components of these liabilities are included in Accrued expenses and other current liabilities and Deferred income taxes and other long-term liabilities, respectively, on the Condensed Consolidated Balance Sheets.

Assets held for sale

Certain facilities identified for closure through integration and other activities have been accounted for as assets held for sale. Assets held for sale primarily consisted of supply chain facilities, and were presented in Prepaid expenses and other current assets in the Condensed Consolidated Balance Sheet as of December 31, 2016. The assets held for sale activity for the first half of 2017 is presented in the table below.


(In millions)
Balance as of December 31, 2016	$	23
Disposition		(23	)

Balance as of July 1, 2017	$	—

Gains on dispositions associated with Merger or restructuring activities are recognized at the corporate level and included when realized in Merger, restructuring and other operating (income) expenses, net in the Condensed Consolidated Statements of Operations. Losses, if any, are recognized when classified as held for sale. Gains or losses associated with dispositions of properties not associated with Merger or restructuring activities are presented in Selling general and administrative expenses in the Condensed Consolidated Statements of Operations when the related accounting criteria are met.

DISCONTINUED OPERATIONS

6 Months Ended

Jul. 01, 2017

DISCONTINUED OPERATIONS

NOTE 3. DISCONTINUED OPERATIONS

In the third quarter of 2016, the Company’s Board of Directors approved a plan to sell substantially all of the operations of the former International Division through four disposal groups (Europe, South Korea, Australia and New Zealand (“Oceania”) and mainland China). Collectively, these dispositions represent a strategic shift that has a major impact on the Company’s operations and financial results and have been accounted for as discontinued operations. The Company is presenting the operating results and cash flows of these disposal groups within discontinued operations through their respective dates of disposal, including all prior periods. The assets and liabilities of the disposal groups remaining at the end of each period are presented as current assets and liabilities of discontinued operations in the Condensed Consolidated Balance Sheets. Certain portions of the former International Division assets and operations are being retained and, therefore, remain in continuing operations. The retained operations are presented as Other in Note 11, Segment Information.

Europe

On September 23, 2016, the Company announced that it had received an irrevocable offer from Aurelius Rho Invest DS GmbH, a subsidiary of The AURELIUS Group (the “Purchaser”) to acquire the Company’s European business operations (the “European Business”). The transaction was structured as an equity sale with the Purchaser acquiring the European Business with its operating assets and liabilities. On December 31, 2016, the Company closed the sale of the European Business resulting in a pre-tax loss on sale of $108 million. The Company recorded approximately $8 million of additional costs associated with the sale of the European Business during the first half of 2017, which includes a $1 million reduction in the loss on sale during the second quarter of 2017 related to the finalization of the working capital adjustment, as discussed below. These amounts are included in Net gain on sale of discontinued operations in the table below.

Approximately $70 million was accrued at December 31, 2016, under a working capital adjustment provision of the sale and purchase agreement (the “SPA”), of which $35 million was paid during the first quarter of 2017. The Purchaser subsequently disagreed with certain items related to the working capital adjustment schedule and, as provided for in the SPA, the parties engaged an independent accountant to resolve the disagreements. In July 2017, the dispute was resolved favorably and the Company paid the remaining working capital adjustment of $37 million to the Purchaser, which included approximately $2 million related to a change in the foreign currency rate and accrued interest on the unpaid portion.

The SPA contains customary warranties of the Company and the Purchaser, with the Company’s warranties limited to an aggregate of EUR 10 million. The Company monitors its estimated exposure to liabilities under the warranties under the SPA, and as of July 1, 2017, the Company believes it has made adequate provisions for its potential exposures related to these warranties. The Company will continue to provide various transition and product sourcing services to the Purchaser for a period of up to 24 months following the closing date under a separate agreement. The proceeds and related costs from these services are presented in Other expense, net as part of continuing operations in the Condensed Consolidated Statements of Operations. Also, as part of the disposition, the Company retained responsibility for the frozen defined benefits pension plan in the United Kingdom, which has been classified in continuing operations.

The Company retains certain guarantees in place with respect to the liabilities or obligations of the European Business and remains contingently liable for these obligations. However, the Purchaser must indemnify and hold the Company harmless for any losses in connection with these guarantees. The Company currently does not believe it is probable it would be required to perform under any of these guarantees or any of the underlying obligations.

South Korea

The sale of the Company’s business in South Korea announced on April 7, 2017, was completed on April 26, 2017. The transaction was structured and accounted for as an equity sale. Disposition of the business in South Korea resulted in a pre-tax gain on sale of $12 million during the second quarter of 2017, which has been reflected in the Net gain on sale of discontinued operations in the table below.

China

The sale of the Company’s business in mainland China announced on June 2, 2017 was completed on July 28, 2017. The transaction was structured and accounted for as an equity sale. The Company may provide certain transitional services to the purchaser for a limited period of time following the closing. The Company recorded a reduction of $1 million and $10 million in the second quarter and first half of 2017, respectively, to its carrying amount of its China Business based on its updated estimates of fair value less cost to sell. The adjustments are included in the net (increase) reduction of loss on discontinued operations held for sale in the table below.

Oceania

On April 18, 2017, the Company entered into a definitive sale and purchase agreement to sell the Company’s Australian and New Zealand business operations. The transaction is structured and accounted for as an equity sale, and is expected to close within the next several months, subject to the purchaser obtaining necessary regulatory approval. The Company recorded adjustments of $2 million and $58 million in the second quarter and first half of 2017, respectively, to its carrying amount of this disposal group that is held for sale based on its updated estimates of fair value less cost to sell. The adjustments resulted in a reduction in the related valuation allowance and are included in the net (increase) reduction of loss on discontinued operations held for sale in the table below. The adjusted carrying amount does not exceed the carrying amount at the time these operations were initially classified as held for sale. Until the closing date, the Company has agreed to operate the Australian and New Zealand businesses in the ordinary course. The Company may provide certain transitional services to the purchaser for a limited period of time following the closing.

Completion of the sale of the remaining International Operations may be for amounts different from the current estimates and will be evaluated each reporting period until the dispositions are complete.

The major components of Discontinued operations, net of tax presented in the Condensed Consolidated Statements of Operations are presented below. The 2016 amounts include the results of the European Business, which was sold at the end of 2016.


	Second Quarter						First Half
(In millions)	2017			2016			2017		2016
Sales	$	119		$	635		$	287	$	1,303
Cost of goods sold and occupancy costs		97			501			233		1,027
Operating expenses		26			146			52		296
Restructuring charges		1			6			2		11
Interest income		—			—			—		1
Interest expense		—			(2	)		—		(4	)
Net (increase) reduction of loss on discontinued operations held for sale		(2	)		—			45		—
Net gain on sale of discontinued operations		13			—			3		—
Income tax expense		3			2			3		4

Discontinued operations, net of tax	$	3		$	(22	)	$	45	$	(38	)

Assets and liabilities of discontinued operations presented in the Condensed Consolidated Balance Sheets as of July 1, 2017, and December 31, 2016, are included in the following table. As the sale of the European Business was completed before year-end 2016, the assets and liabilities of that business are not included in either period presented below. Additionally, the sale of the South Korean business was completed in April 2017, and therefore the assets and liabilities of that business are not included in the July 1, 2017, period presented below.


(In millions)	July 1, 2017			December 31, 2016
Assets
Cash and cash equivalents	$	57		$	44
Receivables, net		68			88
Inventories		56			82
Prepaid expenses and other current assets		3			4
Property and equipment, net		31			31
Other assets		3			6
Valuation allowance		(65	)		(113	)

Current assets of discontinued operations	$	153		$	142

Liabilities
Trade accounts payable	$	42		$	60
Accrued expenses and other current liabilities		21			27
Income taxes payable		1			2
Short-term borrowings and current maturities of long-term debt		—			9
Deferred income taxes and other long-term liabilities		5			6

Current liabilities of discontinued operations	$	69		$	104

DEBT

6 Months Ended

Jul. 01, 2017

DEBT

NOTE 4. DEBT

Amended Credit Agreement

In May 2011, Office Depot entered into an amended and restated credit agreement, which was amended and restated in May 2016 for an additional five years, and was further amended in December 2016 (the “Amended Credit Agreement”). The $1.2 billion facility will mature on May 13, 2021. The Amended Credit Agreement reduces the overall fees and applicable spread on borrowing and modifies certain covenants to provide additional flexibility for incremental indebtedness, acquisitions, asset sales and restricted payments. In connection with the May 2016 amendment, the Company recorded $6 million in debt acquisition costs, which are included in Other assets in the Condensed Consolidated Balance Sheet and will be amortized ratably through May 2021.

At July 1, 2017, the Company had approximately $1.0 billion of available credit under the Amended Credit Agreement, and had letters of credit outstanding of $69 million. There were no borrowings under the Amended Credit Agreement in the second quarter of 2017 and the Company was in compliance with all applicable financial covenants at July 1, 2017.

INCOME TAXES

6 Months Ended

Jul. 01, 2017

INCOME TAXES

NOTE 5. INCOME TAXES

The Company’s effective tax rates were 40% and 39% for the second quarter and first half of 2017, respectively, compared to 9% for the second quarter and first half of 2016. The effective tax rate for the second quarter and first half of 2017 was primarily impacted by the effect of state taxes and nondeductible expenses while the effective tax rate for the second quarter and first half of 2016 was primarily impacted by the effects of the valuation allowance on the U.S. deferred tax assets. The impact of the valuation allowance for the second quarter and first half of 2016 was to reduce the amount of U.S. tax expense recognized, which reduced the overall effective tax rate in those periods. Changes in pretax income projections and the mix of income across jurisdictions could impact the effective tax rate in future quarters.

During the third quarter of 2016, the Company concluded that it was more likely than not that a benefit from a substantial portion of its U.S. federal and state deferred tax assets would be realized. This conclusion was based on a detailed evaluation of all available positive and negative evidence and the weight of such evidence, the current financial position and results of operations for the current and preceding years, and the expectation of continued earnings. The Company determined that approximately $400 million of its U.S. federal and state valuation allowance should be reversed in 2016, with approximately $240 million in the third quarter as a discrete non-cash income tax benefit and the remainder as an adjustment to the estimated annual effective tax rate.

The Company continues to have a U.S. valuation allowance for certain U.S. federal credits and state tax attributes, which relate to deferred tax assets that require certain types of income or for income to be earned in certain jurisdictions in order to be realized. It is reasonably possible that the remaining valuation allowance of $140 million could be reduced by approximately $25 million, possibly within the current year, based upon achieving certain levels of profitability. The Company will continue to assess the realizability of its deferred tax assets in the U.S. and remaining foreign jurisdictions in future periods.

The Company files a U.S. federal income tax return and other income tax returns in various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal and state and local income tax examinations for years before 2016 and 2009, respectively. The acquired OfficeMax U.S. consolidated group is no longer subject to U.S. federal and state and local income tax examinations for years before 2013 and 2006, respectively. The Company’s U.S. federal income tax return for 2016 is currently under review. Generally, the Company is subject to routine examination for years 2008 and forward in its international tax jurisdictions.

It is not reasonably possible that certain tax positions will be resolved within the next 12 months. Additionally, the Company anticipates that it is reasonably possible that new issues will be raised or resolved by tax authorities that may require changes to the balance of unrecognized tax benefits; however, an estimate of such changes cannot be reasonably made.

STOCKHOLDERS' EQUITY

6 Months Ended

Jul. 01, 2017

STOCKHOLDERS' EQUITY

NOTE 6. STOCKHOLDERS’ EQUITY

The following table reflects the changes in Stockholders’ equity.


(In millions)
Stockholders’ equity at December 31, 2016	$	1,852
Net income		140
Repurchase of common stock for treasury		(17	)
Dividends paid on common stock		(26	)
Share purchase for taxes, net of proceeds on employee-related plans		(14	)
Other comprehensive income		23
Amortization of long-term incentive stock grants		17

Stockholders’ equity at July 1, 2017	$	1,975

Accumulated other comprehensive income (loss) activity, net of tax, where applicable, is provided in the following table:


(In millions)	Foreign Currency Translation Adjustments			Change in Deferred Pension and Other			Total
Balance at December 31, 2016	$	(67	)	$	(62	)	$	(129	)
Other comprehensive income activity before reclassifications		18			—			18
Reclassification of foreign currency translation adjustments realized upon disposal of business		5			—			5

Balance at July 1, 2017	$	(44	)	$	(62	)	$	(106	)

Treasury Stock

In May 2016, the Company’s Board of Directors authorized a stock repurchase program of up to $100 million of its outstanding common stock. In August 2016, the Board of Directors authorized increasing the share repurchase program to $250 million. The stock repurchase authorization permits the Company to repurchase stock from time-to-time through a combination of open market repurchases, privately negotiated transactions, 10b5-1 trading plans, accelerated stock repurchase transactions and/or other derivative transactions. The authorization extends to the end of 2018 and may be suspended or discontinued at any time. The exact number and timing of share repurchases will depend on market conditions and other factors, and will be funded through existing liquidity.

In the second quarter and first half of 2017, the Company purchased approximately 2 million shares at a cost of $7 million and 4 million shares at a cost of $17 million, respectively, under the stock repurchase program. As of July 1, 2017, $101 million remains available for repurchase under the current authorization. Refer to Item 2. “Unregistered Sales of Equity Securities and Use of Proceeds” for more information.

Dividends on Common Stock

In the second quarter and first half of 2017, the Company’s Board of Directors declared quarterly cash dividends of $0.025 per share on its common stock, resulting in a total cash payment of $13 million and $26 million, respectively. Dividends have been recorded as a reduction to additional paid-in capital as the Company is in an accumulated deficit position. Additionally, payment of dividends is permitted under the Company’s existing credit facilities provided that the Company has the required minimum liquidity or fixed charge ratio, but may be limited if the Company does not meet the necessary requirements.

EARNINGS PER SHARE

6 Months Ended

Jul. 01, 2017

EARNINGS PER SHARE

NOTE 7. EARNINGS PER SHARE

The following table represents the calculation of net earnings per common share – basic and diluted:


	Second Quarter					First Half
(In millions, except per share amounts)	2017		2016			2017		2016
Basic Earnings Per Share
Numerator:
Net income from continuing operations	$	21	$	232		$	95	$	294
Income (loss) from discontinued operations, net of tax		3		(22	)		45		(38	)

Net income	$	24	$	210		$	140	$	256

Denominator:
Weighted-average shares outstanding		518		550			517		550
Basic earnings (loss) per share:
Continuing operations	$	0.04	$	0.42		$	0.18	$	0.53
Discontinued operations		0.01		(0.04	)		0.09		(0.07	)

Net earnings per share	$	0.05	$	0.38		$	0.27	$	0.47

Diluted Earnings Per Share
Numerator:
Net income from continuing operations	$	21	$	232		$	95	$	294
Income (loss) from discontinued operations, net of tax		3		(22	)		45		(38	)

Net income	$	24	$	210		$	140	$	256

Denominator:
Weighted-average shares outstanding		518		550			517		550
Effect of dilutive securities:
Stock options and restricted stock		14		10			15		7

Diluted weighted-average shares outstanding		532		560			532		557
Diluted earnings (loss) per share
Continuing operations	$	0.04	$	0.41		$	0.18	$	0.53
Discontinued operations		0.01		(0.04	)		0.08		(0.07	)

Net diluted earnings per share	$	0.05	$	0.38		$	0.26	$	0.46

Awards of stock options and nonvested shares representing approximately 4 million additional shares of common stock were outstanding for the second quarter and first half of 2017, and approximately 7 million and 8 million for the second quarter and first half of 2016, respectively, but were not included in the computation of diluted weighted-average shares outstanding because their effect would have been antidilutive.

EMPLOYEE BENEFIT PLANS

6 Months Ended

Jul. 01, 2017

EMPLOYEE BENEFIT PLANS

NOTE 8. EMPLOYEE BENEFIT PLANS

Pension and Other Postretirement Benefit Plans – North America

The components of net periodic pension benefit for the Company’s North America pension plans are as follows:


	Second Quarter						First Half
(In millions)	2017			2016			2017			2016
Service cost	$	1		$	2		$	3		$	4
Interest cost		9			12			19			23
Expected return on plan assets		(12	)		(14	)		(24	)		(28	)

Net periodic pension benefit	$	(2	)	$	—		$	(2	)	$	(1	)

In the first half of 2017, $1 million of cash contributions were made to the North America pension plans. The Company expects to make additional cash contributions of $14 million to the North America pension plans during the remainder of 2017, including a $13 million voluntary accelerated contribution to one of the qualified plans to reduce the costs associated with the plan.

Pension Plan – United Kingdom

As part of the European Business sale, the Company retained the United Kingdom (“UK”) defined benefit pension plan. The components of net periodic pension benefit for the Company’s UK pension plan are as follows:


	Second Quarter						First Half
(In millions)	2017			2016			2017			2016
Service cost	$	—		$	—		$	—		$	—
Interest cost		1			2			3			4
Expected return on plan assets		(3	)		(3	)		(6	)		(6	)

Net periodic pension benefit	$	(2	)	$	(1	)	$	(3	)	$	(2	)

The UK pension plan is in a net asset position. In the first half of 2017, cash contributions of $1 million were made to the UK pension plan. The Company is required to make an additional cash contribution of $1 million to the UK pension plan during the remainder of 2017.

Net periodic pension benefits for the North America and UK pension and other postretirement benefit plans are recorded in Selling, general and administrative expenses at the corporate level in the Condensed Consolidated Statements of Operations.

FAIR VALUE MEASUREMENTS

6 Months Ended

Jul. 01, 2017

FAIR VALUE MEASUREMENTS

NOTE 9. FAIR VALUE MEASUREMENTS

The Company measures fair value 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 under current market conditions. In developing its fair value estimates, the Company uses the following hierarchy:


Level 1:		Quoted prices in active markets for identical assets or liabilities.

Level 2:		Observable market based inputs or unobservable inputs that are corroborated by market data.

Level 3:		Significant unobservable inputs that are not corroborated by market data. Generally, these fair value measures are model-based valuation techniques such as discounted cash flows or option pricing models using the Company’s own estimates and assumptions or those expected to be used by market participants.

Recurring Fair Value Measurements

In accordance with accounting principles generally accepted in the United States, certain assets and liabilities are required to be recorded at fair value on a recurring basis. The Company’s assets and liabilities that are adjusted to fair value on a recurring basis are money market funds that qualify as cash equivalents, and derivative financial instruments.


	Level 1
(In millions)	July 1, 2017		December 31, 2016
Money market funds	$	139	$	135

The fair values of the Company’s foreign currency contracts and fuel contracts are the amounts receivable or payable to terminate the agreements at the reporting date, taking into account current interest rates, exchange rates and commodity prices. The values are based on market-based inputs or unobservable inputs that are corroborated by market data. Amounts associated with derivative financial instruments are considered Level 1 measurements, but were not significant for the reported periods. At July 1, 2017, and December 31, 2016, Accrued expenses and other liabilities in the Condensed Consolidated Balance Sheets included less than $1 million related to derivative fuel contracts.

Nonrecurring Fair Value Measurements

In addition to assets and liabilities that are recorded at fair value on a recurring basis, the Company records certain assets and liabilities at fair value on a nonrecurring basis as required by accounting principles generally accepted in the United States. Generally, assets are recorded at fair value on a nonrecurring basis as a result of impairment charges. The Company recognized $1 million of asset impairment charges associated with continuing operations in the second quarter and first half of 2017.

Other Fair Value Disclosures

The fair values of cash and cash equivalents, receivables, trade accounts payable and accrued expenses and other current liabilities approximate their carrying values because of their short-term nature.

The following table presents information about financial instruments at the balance sheet dates indicated.


	July 1, 2017				December 31, 2016
(In millions)	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets
Timber notes receivable	$	874	$	881	$	885	$	884
Company-owned life insurance		87		87		89		89
Financial liabilities
Recourse debt
Revenue bonds, due in varying amounts periodically through 2029		186		186		186		181
American & Foreign Power Company, Inc. 5% debentures, due 2030		14		14		14		12
Non-recourse debt		787		793		798		800

The following methods and assumptions were used to estimate the fair value of each class of financial instruments:

•

Timber notes receivable: Fair value is determined as the present value of expected future cash flows discounted at the current interest rate for loans of similar terms with comparable credit risk (Level 2 measure).

•

Company-owned life insurance: In connection with the Merger, the Company acquired company owned life insurance policies on certain former employees. The fair value of the company-owned life insurance policies is derived using determinable net cash surrender value (Level 2 measure).

•

Recourse debt: Recourse debt for which there were no transactions on the measurement date was valued based on quoted market prices near the measurement date when available or by discounting the future cash flows of each instrument using rates based on the most recently observable trade or using rates currently offered to the Company for similar debt instruments of comparable maturities (Level 2 measure).

•

Non-recourse debt: Fair value is estimated by discounting the future cash flows of the instrument at rates currently available to the Company for similar instruments of comparable maturities (Level 2 measure).

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

COMMITMENTS AND CONTINGENCIES

6 Months Ended

Jul. 01, 2017

COMMITMENTS AND CONTINGENCIES

NOTE 10. COMMITMENTS AND CONTINGENCIES

Legal Matters

The Company is involved in litigation arising in the normal course of business. While, from time to time, claims are asserted that make demands for a large sum of money (including actions which are asserted to be maintainable as class action suits), the Company does not believe that contingent liabilities related to these matters (including the matters discussed below), either individually or in the aggregate, will materially affect the Company’s financial position, results of operations or cash flows.

In addition, in the ordinary course of business, sales to and transactions with government customers may be subject to lawsuits, investigations, audits and review by governmental authorities and regulatory agencies, with which the Company cooperates. Many of these lawsuits, investigations, audits and reviews are resolved without material impact to the Company. While claims in these matters may at times assert large demands, the Company does not believe that contingent liabilities related to these matters, either individually or in the aggregate, will materially affect its financial position, results of operations or cash flows.

In addition to the foregoing, OfficeMax is named a defendant in a number of lawsuits, claims, and proceedings arising out of the operation of certain paper and forest products assets prior to those assets being sold in 2004, for which OfficeMax agreed to retain responsibility. Also, as part of that sale, OfficeMax agreed to retain responsibility for all pending or threatened proceedings and future proceedings alleging asbestos-related injuries arising out of the operation of the paper and forest products assets prior to the closing of the sale. The Company has made provision for losses with respect to the pending proceedings. Additionally, as of July 1, 2017, the Company has made provision for environmental liabilities with respect to certain sites where hazardous substances or other contaminants are or may be located. For these environmental liabilities, our estimated range of reasonably possible losses was approximately $10 million to $25 million. The Company regularly monitors its estimated exposure to these liabilities. As additional information becomes known, these estimates may change, however, the Company does not believe any of these OfficeMax retained proceedings are material to the Company’s financial position, results of operations or cash flows.

SEGMENT INFORMATION

6 Months Ended

Jul. 01, 2017

SEGMENT INFORMATION

NOTE 11. SEGMENT INFORMATION

Following the decision to sell substantially all of the operations that previously were presented as the International Division, the Company has two operating segments which are also its reportable segments: the Retail Division and the Business Solutions Division. The Retail Division includes retail stores in the United States, including Puerto Rico and the U.S. Virgin Islands, which offer office supplies, technology products and solutions, business machines and related supplies, facilities products, and office furniture. Stores also have a copy and print center offering printing, reproduction, mailing and shipping services. The Business Solutions Division sells office supply products and services in the United States, including Puerto Rico and the U.S. Virgin Islands, and Canada. The Business Solutions Division customers are served through dedicated sales forces, catalogs, telesales, and electronically through its internet sites.

The retained operations previously included in the International Division are not significant and have been presented as Other.

The office supply products and services offered across the segments are similar. Division operating income is determined based on the measure of performance reported internally to manage the business and for resource allocation. This measure charges to the respective Divisions those expenses considered directly or closely related to their operations and allocates support costs. Certain operating expenses and credits are not allocated to the Divisions including Merger, restructuring and other operating (income) expenses, net, and Asset impairments, as well as expenses and credits retained at the corporate level, including certain management costs and legacy pension and environmental matters. Other companies may charge more or less of these items to their segments and results may not be comparable to similarly titled measures used by other entities.

The following is a summary of sales and operating income (loss) by each of the Divisions, reconciled to consolidated totals, after the elimination of the discontinued operations for all periods.


	Sales
	Second Quarter					First Half
(In millions)	2017			2016		2017			2016
Retail Division	$	1,111		$	1,249	$	2,469		$	2,755
Business Solutions Division		1,248			1,330		2,563			2,698
Other		4			4		7			6

Total	$	2,363		$	2,583	$	5,039		$	5,459


	Operating Income (Loss)
	Second Quarter					First Half
(In millions)	2017			2016		2017			2016
Retail Division	$	20		$	30	$	132		$	132
Business Solutions Division		64			63		122			109
Other		(1	)		2		(2	)		2

Total	$	83		$	95	$	252		$	243

A reconciliation of the measure of Division operating income to Consolidated income from continuing operations before income taxes is as follows:


	Second Quarter						First Half
(In millions)	2017			2016			2017			2016
Total Division operating income	$	83		$	95		$	252		$	243
Add/(subtract):
Asset impairments		(1	)		—			(1	)		—
Merger, restructuring and other operating income (expenses), net		(20	)		193			(40	)		154
Unallocated expenses		(16	)		(17	)		(38	)		(41	)
Interest income		6			6			12			11
Interest expense		(14	)		(23	)		(27	)		(44	)
Other expense, net		(3	)		—			(2	)		—

Income from continuing operations before income taxes	$	35		$	254		$	156		$	323

As of July 1, 2017, goodwill totaled $363 million, of which $78 million was recorded in the Retail Division and $285 million in the Business Solutions Division.

SUBSEQUENT EVENTS	6 Months Ended
SUBSEQUENT EVENTS	Jul. 01, 2017
SUBSEQUENT EVENTS	NOTE 12. SUBSEQUENT EVENTS On July 28, 2017, the Company completed the sale of its business operations in mainland China. Refer to Note 3, Discontinued Operations, for additional information. On August 3, 2017, the Company completed the acquisition of a small company in North America, which will provide the Company with an enhanced platform in the cleaning and breakroom market.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	Jul. 01, 2017
Basis of Presentation	Basis of Presentation Office Depot, Inc., including consolidated subsidiaries (“Office Depot” or the “Company”), is a provider of office supplies, business products and services delivered through an omnichannel platform. The Company currently operates under several banners, including Office Depot ^® and OfficeMax ^® and utilizes proprietary company and product brand names. The Company’s common stock is traded on the NASDAQ Global Select Market under the ticker symbol “ODP.” As of July 1, 2017, the Company sold to customers through two reportable segments (or “Divisions”): Retail Division and Business Solutions Division. In September 2016, the Company’s Board of Directors committed to a plan to sell substantially all of the Company’s International Division operations (the “International Operations”). Accordingly, the Company has presented the International Operations as discontinued operations beginning in the third quarter 2016. The Company has reclassified the financial results of the International Operations to Discontinued operations, net of tax in the Condensed Consolidated Statements of Operations for all periods presented. The Company also classified the related assets and liabilities as current assets and liabilities of discontinued operations on the accompanying Condensed Consolidated Balance Sheets as of July 1, 2017, and December 31, 2016. Cash flows from the Company’s discontinued operations are presented in the Condensed Consolidated Statements of Cash Flows for all periods. Certain portions of the International Division assets and operations are being retained or did not meet the held for sale criteria and therefore remain in continuing operations, with prior periods adjusted, where appropriate. Additional information on the dispositions is provided in Note 3. The Condensed Consolidated Financial Statements as of July 1, 2017, and for the 13-week and 26-week periods ended July 1, 2017 (also referred to as “the second quarter of 2017” and “the first half of 2017,” respectively) and June 25, 2016 (also referred to as “the second quarter of 2016” and “the first half of 2016,” respectively) are unaudited. However, in management’s opinion, these condensed consolidated financial statements reflect all adjustments of a normal recurring nature necessary to provide a fair presentation of the Company’s financial position, results of operations and cash flows for the periods presented. The Company has prepared the Condensed Consolidated Financial Statements included herein pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Some information and note disclosures, which would normally be included in comprehensive annual financial statements prepared in accordance with accounting principles generally accepted in the United States, have been condensed or omitted pursuant to those SEC rules and regulations. For a better understanding of the Company and its Condensed Consolidated Financial Statements, we recommend reading these Condensed Consolidated Financial Statements in conjunction with the audited financial statements which are included in the 2016 Form 10-K. These interim results are not necessarily indicative of the results that should be expected for the full year.
Cash Management	Cash Management The cash management process generally utilizes zero balance accounts which provide for the settlement of the related disbursement and cash concentration accounts on a daily basis. Trade accounts payable and Accrued expenses and other current liabilities as of July 1, 2017 and December 31, 2016, included $44 million and $58 million, respectively, of amounts not yet presented for payment drawn in excess of disbursement account book balances, after considering offset provisions. At July 1, 2017, cash and cash equivalents from continuing operations but held outside the United States amounted to $134 million. Additionally, $57 million of cash held outside the United States was included in current assets of discontinued operations.
New Accounting Standards	New Accounting Standards Standards that are not yet adopted In May 2014, the Financial Accounting Standards Board (“FASB”) issued an accounting standards update that supersedes most current revenue recognition guidance and modifies the accounting for certain costs associated with revenue generation. The core principle of this guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The guidance provides a number of steps to apply to achieve that principle and requires additional disclosures. The standard was originally to be effective for the Company’s first quarter of 2017. In July 2015, the FASB approved a one year extension to the required implementation date but also permitted companies to adopt the standard at the original effective date of 2017. The new revenue recognition standard may be applied retrospectively to each prior period presented or modified retrospectively with the cumulative effect recognized as of the date of adoption. The Company continues to assess the impact this new standard will have on its Consolidated Financial Statements and has not yet decided on which adoption alternative to apply upon adoption in the first quarter of 2018. However, based on its ongoing assessment, the Company expects that the new standard will require the impacts of its loyalty programs to be presented as a reduction of revenue, rather than as cost accruals as is permitted under existing accounting rules. Additionally, the timing of revenue recognition will be accelerated for items where the Company’s performance obligation is complete, such as certain commission arrangements, and delayed where performance obligations remain, such as certain coupons and incentives offered from time-to-time. The Company also continues to assess its disclosure requirements related to this new standard and changes that may be necessary to the Company’s systems and internal controls over financial reporting. The Company will adopt the standard in the first quarter of 2018, and does not expect the adoption of the new standard to materially affect its consolidated net income, cash flows or financial position. In February 2016, the FASB issued an accounting standards update which will require lessees to recognize most leases on their balance sheets related to the rights and obligations created by those leases. The accounting treatment for lessors will remain relatively unchanged. The accounting standards update also requires additional qualitative and quantitative disclosures related to the nature, timing and uncertainty of cash flows arising from leases. The guidance is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. Lessees and lessors are required to use a modified retrospective transition method for existing leases and accordingly, apply the new accounting model for the earliest year presented in the financial statements. The Company is currently evaluating the impact the adoption of this new standard will have on its Consolidated Financial Statements but anticipates it will result in significant right of use assets and related liabilities associated with its operating leases being recorded on its balance sheet. Substantially all of the Company’s retail store locations and supply chain facilities are subject to operating lease arrangements. The Company will adopt the standard in the first quarter of 2019, and has begun implementing required upgrades to its existing lease systems. In March 2017, the FASB issued an accounting standards update which changes the income statement presentation of defined benefit plan expense by requiring that an employer report the service cost component of pension costs in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit pension cost will be presented in the income statement separately from the service cost component and outside a subtotal of operating income. Employers will have to disclose the line(s) used to present the other components of net periodic benefit cost, if the components are not presented separately in the income statement. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted. The Company expects the adoption of this accounting standard update to reduce operating income by approximately $13 million on an annual basis, but have no impact on net income. Standards that were adopted During the first quarter of 2017, the Company adopted the new accounting standard which modifies several aspects of the accounting and reporting for employee share-based payments and related tax accounting impacts, including the presentation in the statements of operations and cash flows of certain tax benefits or deficiencies and employee tax withholdings, as well as the accounting for award forfeitures over the vesting period. Starting in the first quarter of 2017, stock-based compensation excess tax benefits or deficiencies are reflected in the Consolidated Statements of Operations as a component of the provision for income taxes, whereas they previously were recognized in equity. Additionally, the Consolidated Statements of Cash Flows now present excess tax benefits as an operating activity, which was applied prospectively in accordance with the standard and therefore prior periods have not been adjusted. Finally, the Company has elected to account for forfeitures as they occur rather than estimate expected forfeitures, which was applied on a modified retrospective basis, resulting in a cumulative effect that increased accumulated deficit by approximately $1 million as of January 1, 2017.

MERGER, ACQUISITION TERMINATION, AND RESTRUCTURING ACTIVITY (Tables)

6 Months Ended

Jul. 01, 2017

Summary of Major Components of Merger, Restructuring and Other Operating Expenses, Net

The table below and narrative that follow provide the major components of Merger, restructuring and other operating (income) expenses, net.


	Second Quarter						First Half
(In millions)	2017			2016			2017		2016
Merger related (income) expenses
Transaction and integration	$	5		$	11		$	11	$	22
Facility closure, contract termination, and other expenses, net		(2	)		14			2		17

Total Merger related expenses		3			25			13		39

Staples Acquisition (income) expenses
Retention		—			13			—		15
Transaction		—			18			—		38
Termination Fee		—			(250	)		—		(250	)

Total Staples Acquisition income		—			(219	)		—		(197	)

Comprehensive Business Review and other restructuring expenses
Severance		6			1			15		4
Facility closure, contract termination, professional fees and other expenses, net		11			—			12		—

Total Comprehensive Business Review and other restructuring expenses		17			1			27		4

Total Merger, restructuring and other operating (income) expenses, net	$	20		$	(193	)	$	40	$	(154	)

Facility Closure and Severance Costs

These remaining amounts are excluded from the table below because they are charges that are recorded and paid in the same period.


			First Half of 2017
(In millions)	Balance as of December 31, 2016		Charges Incurred		Cash Payments			Lease Accretion and Other Adjustments			Balance as of July 1, 2017
Termination benefits
Merger related accruals	$	5	$	—	$	(3	)	$	—		$	2
Comprehensive Business Review		8		15		(17	)		—			6
Lease and contract obligations, accruals for facilities closures and other costs:
Merger related accruals		40		4		(18	)		—			26
Comprehensive Business Review		13		8		(8	)		—			13
Other restructuring accruals		5		1		(2	)		2			6
Acquired entity store closure accruals		18		—		(4	)		(1	)		13

Total	$	89	$	28	$	(52	)	$	1		$	66

Assets Held for Sale Activity

The assets held for sale activity for the first half of 2017 is presented in the table below.


(In millions)
Balance as of December 31, 2016	$	23
Disposition		(23	)

Balance as of July 1, 2017	$	—

DISCONTINUED OPERATIONS (Tables)

6 Months Ended

Jul. 01, 2017

Major Component of Discontinued Operations, Net of Tax


	Second Quarter						First Half
(In millions)	2017			2016			2017		2016
Sales	$	119		$	635		$	287	$	1,303
Cost of goods sold and occupancy costs		97			501			233		1,027
Operating expenses		26			146			52		296
Restructuring charges		1			6			2		11
Interest income		—			—			—		1
Interest expense		—			(2	)		—		(4	)
Net (increase) reduction of loss on discontinued operations held for sale		(2	)		—			45		—
Net gain on sale of discontinued operations		13			—			3		—
Income tax expense		3			2			3		4

Discontinued operations, net of tax	$	3		$	(22	)	$	45	$	(38	)


(In millions)	July 1, 2017			December 31, 2016
Assets
Cash and cash equivalents	$	57		$	44
Receivables, net		68			88
Inventories		56			82
Prepaid expenses and other current assets		3			4
Property and equipment, net		31			31
Other assets		3			6
Valuation allowance		(65	)		(113	)

Current assets of discontinued operations	$	153		$	142

Liabilities
Trade accounts payable	$	42		$	60
Accrued expenses and other current liabilities		21			27
Income taxes payable		1			2
Short-term borrowings and current maturities of long-term debt		—			9
Deferred income taxes and other long-term liabilities		5			6

Current liabilities of discontinued operations	$	69		$	104

- Definition

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 45
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=65878427&loc=SL51721533-107759

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 4B
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721665-107760

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=64827811&loc=d3e1474-107760

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
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-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=64827811&loc=d3e1361-107760

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-SubTopic 20
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721683-107760

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
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-Topic 360
-SubTopic 10
-Section 50
-Paragraph 3A
-URI http://asc.fasb.org/extlink&oid=84176398&loc=SL51724579-110230

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 5C
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721675-107760

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 4A
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721663-107760

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 360
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84176398&loc=d3e2941-110230

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 5B
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721673-107760

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
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-Paragraph 3A
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721659-107760

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
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-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721671-107760

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 5D
-URI http://asc.fasb.org/extlink&oid=64827811&loc=SL51721677-107760

+ Details

STOCKHOLDERS' EQUITY (Tables)

6 Months Ended

Jul. 01, 2017

Schedule of Stockholders' Equity

The following table reflects the changes in Stockholders’ equity.


(In millions)
Stockholders’ equity at December 31, 2016	$	1,852
Net income		140
Repurchase of common stock for treasury		(17	)
Dividends paid on common stock		(26	)
Share purchase for taxes, net of proceeds on employee-related plans		(14	)
Other comprehensive income		23
Amortization of long-term incentive stock grants		17

Stockholders’ equity at July 1, 2017	$	1,975

Accumulated Other Comprehensive Income (Loss) Activity, Net of Tax

Accumulated other comprehensive income (loss) activity, net of tax, where applicable, is provided in the following table:


(In millions)	Foreign Currency Translation Adjustments			Change in Deferred Pension and Other			Total
Balance at December 31, 2016	$	(67	)	$	(62	)	$	(129	)
Other comprehensive income activity before reclassifications		18			—			18
Reclassification of foreign currency translation adjustments realized upon disposal of business		5			—			5

Balance at July 1, 2017	$	(44	)	$	(62	)	$	(106	)

EARNINGS PER SHARE (Tables)

6 Months Ended

Jul. 01, 2017

Calculation of Net Earnings (Loss) Per Common Share

The following table represents the calculation of net earnings per common share – basic and diluted:


	Second Quarter					First Half
(In millions, except per share amounts)	2017		2016			2017		2016
Basic Earnings Per Share
Numerator:
Net income from continuing operations	$	21	$	232		$	95	$	294
Income (loss) from discontinued operations, net of tax		3		(22	)		45		(38	)

Net income	$	24	$	210		$	140	$	256

Denominator:
Weighted-average shares outstanding		518		550			517		550
Basic earnings (loss) per share:
Continuing operations	$	0.04	$	0.42		$	0.18	$	0.53
Discontinued operations		0.01		(0.04	)		0.09		(0.07	)

Net earnings per share	$	0.05	$	0.38		$	0.27	$	0.47

Diluted Earnings Per Share
Numerator:
Net income from continuing operations	$	21	$	232		$	95	$	294
Income (loss) from discontinued operations, net of tax		3		(22	)		45		(38	)

Net income	$	24	$	210		$	140	$	256

Denominator:
Weighted-average shares outstanding		518		550			517		550
Effect of dilutive securities:
Stock options and restricted stock		14		10			15		7

Diluted weighted-average shares outstanding		532		560			532		557
Diluted earnings (loss) per share
Continuing operations	$	0.04	$	0.41		$	0.18	$	0.53
Discontinued operations		0.01		(0.04	)		0.08		(0.07	)

Net diluted earnings per share	$	0.05	$	0.38		$	0.26	$	0.46

EMPLOYEE BENEFIT PLANS (Tables)

6 Months Ended

Jul. 01, 2017

North America

Components of Net Periodic Pension Benefit

The components of net periodic pension benefit for the Company’s North America pension plans are as follows:


	Second Quarter						First Half
(In millions)	2017			2016			2017			2016
Service cost	$	1		$	2		$	3		$	4
Interest cost		9			12			19			23
Expected return on plan assets		(12	)		(14	)		(24	)		(28	)

Net periodic pension benefit	$	(2	)	$	—		$	(2	)	$	(1	)

United Kingdom

Components of Net Periodic Pension Benefit

The components of net periodic pension benefit for the Company’s UK pension plan are as follows:


	Second Quarter						First Half
(In millions)	2017			2016			2017			2016
Service cost	$	—		$	—		$	—		$	—
Interest cost		1			2			3			4
Expected return on plan assets		(3	)		(3	)		(6	)		(6	)

Net periodic pension benefit	$	(2	)	$	(1	)	$	(3	)	$	(2	)

FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jul. 01, 2017

Assets and Liabilities Adjusted to Fair Value on Recurring Basis

The Company’s assets and liabilities that are adjusted to fair value on a recurring basis are money market funds that qualify as cash equivalents, and derivative financial instruments.


	Level 1
(In millions)	July 1, 2017		December 31, 2016
Money market funds	$	139	$	135

Schedule of Fair Value of Assets and Liabilities

The following table presents information about financial instruments at the balance sheet dates indicated.


	July 1, 2017				December 31, 2016
(In millions)	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets
Timber notes receivable	$	874	$	881	$	885	$	884
Company-owned life insurance		87		87		89		89
Financial liabilities
Recourse debt
Revenue bonds, due in varying amounts periodically through 2029		186		186		186		181
American & Foreign Power Company, Inc. 5% debentures, due 2030		14		14		14		12
Non-recourse debt		787		793		798		800

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

SEGMENT INFORMATION (Tables)

6 Months Ended

Jul. 01, 2017

Summary of Significant Accounts and Balances by Each Divisions

The following is a summary of sales and operating income (loss) by each of the Divisions, reconciled to consolidated totals, after the elimination of the discontinued operations for all periods.


	Sales
	Second Quarter					First Half
(In millions)	2017			2016		2017			2016
Retail Division	$	1,111		$	1,249	$	2,469		$	2,755
Business Solutions Division		1,248			1,330		2,563			2,698
Other		4			4		7			6

Total	$	2,363		$	2,583	$	5,039		$	5,459


	Operating Income (Loss)
	Second Quarter					First Half
(In millions)	2017			2016		2017			2016
Retail Division	$	20		$	30	$	132		$	132
Business Solutions Division		64			63		122			109
Other		(1	)		2		(2	)		2

Total	$	83		$	95	$	252		$	243

Reconciliation of Measure of Division Operating Income to Consolidated Income Before Income Taxes

A reconciliation of the measure of Division operating income to Consolidated income from continuing operations before income taxes is as follows:


	Second Quarter						First Half
(In millions)	2017			2016			2017			2016
Total Division operating income	$	83		$	95		$	252		$	243
Add/(subtract):
Asset impairments		(1	)		—			(1	)		—
Merger, restructuring and other operating income (expenses), net		(20	)		193			(40	)		154
Unallocated expenses		(16	)		(17	)		(38	)		(41	)
Interest income		6			6			12			11
Interest expense		(14	)		(23	)		(27	)		(44	)
Other expense, net		(3	)		—			(2	)		—

Income from continuing operations before income taxes	$	35		$	254		$	156		$	323

Summary of Significant Accounting Policies - Additional Information (Detail) $ in Millions		1 Months Ended	6 Months Ended
	Jan. 01, 2017 USD ($)	Mar. 31, 2017 USD ($)	Jul. 01, 2017 USD ($) Segment	Dec. 31, 2016 USD ($)	Jun. 25, 2016 USD ($)
Summary Of Significant Accounting Policies [Line Items]
Number of reportable segments \| Segment			2
Accounts payable and accrued expenses and other current liabilities not yet presented for payment			$ 44	$ 58
Cash and cash equivalents			763	$ 763	$ 1,014
Cash and cash equivalents, discontinued operations			57		$ 104
Reduction in operating income due to early adoption		$ (13)
Cumulative effect on accumulated deficit, net of tax	$ 1
Non-US
Summary Of Significant Accounting Policies [Line Items]
Cash and cash equivalents			134
Cash and cash equivalents, discontinued operations			$ 57

Merger, Acquisition Termination and Restructuring Activity - Additional Information (Detail) $ in Millions		1 Months Ended	3 Months Ended		6 Months Ended
	May 19, 2016 USD ($)	Aug. 31, 2016 USD ($) Store	Jul. 01, 2017 USD ($)	Jun. 25, 2016 USD ($)	Jul. 01, 2017 USD ($) Store	Jun. 25, 2016 USD ($)
Business Acquisition [Line Items]
Number of retail stores closed under real estate strategy \| Store					400
Supply chain closure anticipated completion year					2017
Termination Fee				$ 250		$ 250
Charges Incurred					$ 28
Severance expense				1		4
Merger, restructuring and other operating expenses, net			$ 20	(193)	40	(154)
Transaction and integration			5	11	11	22
Facility closure, contract termination, professional fees and other expenses, net			11		$ 12
Comprehensive Business Review
Business Acquisition [Line Items]
Number of retail stores planned to be closed \| Store		300
Retail stores closure period		3 years			2 years
Estimated cost to be incurred		$ 125
Charges Incurred					$ 75
Remaining cost recognized, period					2 years
Number of retail stores planned to be closed \| Store					300
Number of Retail Stores closed \| Store					105
Staples, Inc.
Business Acquisition [Line Items]
Termination Fee	$ 250
Merger, restructuring and other operating expenses, net
Business Acquisition [Line Items]
Charges Incurred					$ 12
Gain on sale of warehouse facilities classified as assets held for sale			$ 5	$ 1	6	$ 1
Facility closure, contract termination, professional fees and other expenses, net					$ 7

Summary of Major Components of Merger, Restructuring and Other Operating Expenses, Net (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Merger related (income) expenses
Transaction and integration	$ 5	$ 11	$ 11	$ 22
Facility closure, contract termination, and other expenses, net	(2)	14	2	17
Total Merger related expenses	3	25	13	39
Staples Acquisition (income) expenses
Retention		13		15
Transaction		18		38
Termination Fee		(250)		(250)
Total Staples Acquisition income		(219)		(197)
Comprehensive Business Review and other restructuring expenses
Severance	6	1	15	4
Facility closure, contract termination, professional fees and other expenses, net	11		12
Total Comprehensive Business Review and other restructuring expenses	17	1	27	4
Total Merger, restructuring and other operating (income) expenses, net	$ 20	$ (193)	$ 40	$ (154)

Severance and Facility Closure Costs (Detail) $ in Millions	6 Months Ended
Severance and Facility Closure Costs (Detail) $ in Millions	Jul. 01, 2017 USD ($)
Restructuring Cost and Reserve [Line Items]
Beginning Balance	$ 89
Charges Incurred	28
Cash Payments	(52)
Lease Accretion and Other Adjustments	1
Ending Balance	66
Comprehensive Business Review
Restructuring Cost and Reserve [Line Items]
Charges Incurred	75
Termination benefits \| Merger related accruals
Restructuring Cost and Reserve [Line Items]
Beginning Balance	5
Cash Payments	(3)
Ending Balance	2
Termination benefits \| Comprehensive Business Review
Restructuring Cost and Reserve [Line Items]
Beginning Balance	8
Charges Incurred	15
Cash Payments	(17)
Ending Balance	6
Lease and contract obligations, accruals for facilities closures and other costs \| Merger related accruals
Restructuring Cost and Reserve [Line Items]
Beginning Balance	40
Charges Incurred	4
Cash Payments	(18)
Ending Balance	26
Lease and contract obligations, accruals for facilities closures and other costs \| Comprehensive Business Review
Restructuring Cost and Reserve [Line Items]
Beginning Balance	13
Charges Incurred	8
Cash Payments	(8)
Ending Balance	13
Lease and contract obligations, accruals for facilities closures and other costs \| Other restructuring accruals
Restructuring Cost and Reserve [Line Items]
Beginning Balance	5
Charges Incurred	1
Cash Payments	(2)
Lease Accretion and Other Adjustments	2
Ending Balance	6
Lease and contract obligations, accruals for facilities closures and other costs \| Acquired entity store closure accruals
Restructuring Cost and Reserve [Line Items]
Beginning Balance	18
Cash Payments	(4)
Lease Accretion and Other Adjustments	(1)
Ending Balance	$ 13

Assets Held for Sale Activity (Detail) $ in Millions	6 Months Ended
Assets Held for Sale Activity (Detail) $ in Millions	Jul. 01, 2017 USD ($)
Long Lived Assets Held-for-sale [Line Items]
Beginning Balance	$ 23
Disposition	(23)
Ending Balance	$ 0

Discontinued Operations - Additional Information (Detail) € in Millions, $ in Millions	3 Months Ended			6 Months Ended	12 Months Ended	13 Months Ended
	Jul. 01, 2017 USD ($)	Apr. 01, 2017 USD ($)	Sep. 24, 2016 Group	Jul. 01, 2017 USD ($)	Dec. 31, 2016 USD ($)	Jul. 01, 2017 USD ($)	Sep. 23, 2016 EUR (€)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of disposal groups \| Group			4
Discontinued Operations \| European Business
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Warranties on sale and purchase agreement \| €							€ 10
Discontinued Operations \| South Korea
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of discontinued operations	$ 12
Discontinued Operations \| China
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of discontinued operations	1			$ 10
Discontinued Operations \| Ocenia
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of discontinued operations	$ 2			58
Discontinued Operations \| Aurelius Rho Invest DS GmbH \| European Business
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gain (loss) on sale of discontinued operations				(8)	$ (108)	$ 1
Accrued liability under working capital adjustment provision					$ 70
Payment of accrued liability under working capital adjustment provision		$ 35		37
Change in foreign currency rate and accrued interest on unpaid portion				$ 2
Discontinued Operations \| Aurelius Rho Invest DS GmbH \| European Business \| Maximum
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Transition services period				24 months

Major Component of Discontinued Operations, Net of Tax (Detail) - Discontinued Operations, Held-for-Sale - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sales	$ 119	$ 635	$ 287	$ 1,303
Cost of goods sold and occupancy costs	97	501	233	1,027
Operating expenses	26	146	52	296
Restructuring charges	1	6	2	11
Interest income				1
Interest expense		(2)		(4)
Net (increase) reduction of loss on discontinued operations held for sale	(2)		45
Net gain on sale of discontinued operations	13		3
Income tax expense	3	2	3	4
Discontinued operations, net of tax	$ 3	$ (22)	$ 45	$ (38)

Assets and Liabilities of Discontinued Operations (Detail) - USD ($) $ in Millions	Jul. 01, 2017	Dec. 31, 2016	Jun. 25, 2016
Assets
Cash and cash equivalents	$ 57		$ 104
Current assets of discontinued operations	153	$ 142
Liabilities
Current liabilities of discontinued operations	69	104
Discontinued Operations, Held-for-Sale
Assets
Cash and cash equivalents	57	44
Receivables, net	68	88
Inventories	56	82
Prepaid expenses and other current assets	3	4
Property and equipment, net	31	31
Other assets	3	6
Valuation allowance	(65)	(113)
Current assets of discontinued operations	153	142
Liabilities
Trade accounts payable	42	60
Accrued expenses and other current liabilities	21	27
Income taxes payable	1	2
Short-term borrowings and current maturities of long-term debt		9
Deferred income taxes and other long-term liabilities	5	6
Current liabilities of discontinued operations	$ 69	$ 104

Debt - Additional Information (Detail) - Amended Credit Agreement - USD ($)	1 Months Ended	6 Months Ended
	May 31, 2016	Jul. 01, 2017
Debt Instrument [Line Items]
Expiration period under the new Facility	5 years
Maximum borrowing capacity under the new Facility	$ 1,200,000,000
Maturity date of the new Facility	May 13, 2021
Available credit under the Facility		$ 1,000,000,000
Amount outstanding under letters of credit		69,000,000
Average borrowings under the Facility		$ 0
Other Assets
Debt Instrument [Line Items]
Debt acquisition costs	$ 6,000,000

Income Taxes - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended			6 Months Ended		12 Months Ended
	Jul. 01, 2017	Sep. 24, 2016	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016	Dec. 31, 2016
Income Taxes [Line Items]
Effective tax rate	40.00%		9.00%	39.00%	9.00%
Non-cash income tax benefit				$ 42	$ 2
Valuation Allowance of Deferred Tax Assets
Income Taxes [Line Items]
Decrease in valuation allowance				25
U.S. Federal and State
Income Taxes [Line Items]
Decrease in valuation allowance						$ (400)
Non-cash income tax benefit		$ 240
U.S. Federal and State \| Valuation Allowance of Deferred Tax Assets
Income Taxes [Line Items]
Valuation allowance	$ 140			$ 140

Schedule of Stockholders' Equity (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Stockholders Equity [Line Items]
Beginning Balance			$ 1,852
Net income	$ 24	$ 210	140	$ 256
Repurchase of common stock for treasury	(7)		(17)
Dividends paid on common stock			(26)
Share purchase for taxes, net of proceeds on employee-related plans			(14)
Other comprehensive income	17	$ 5	23	$ 11
Amortization of long-term incentive stock grants			17
Ending Balance	$ 1,975		$ 1,975

Accumulated Other Comprehensive Income (Loss) Activity, Net of Tax (Detail) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jul. 01, 2017	Jul. 01, 2017
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		$ 1,852
Other comprehensive income activity before reclassifications		18
Reclassification of foreign currency translation adjustments realized upon disposal of business	$ 5	5
Ending Balance	1,975	1,975
Foreign Currency Translation Adjustments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(67)
Other comprehensive income activity before reclassifications		18
Reclassification of foreign currency translation adjustments realized upon disposal of business		5
Ending Balance	(44)	(44)
Change in Deferred Pension and Other
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(62)
Ending Balance	(62)	(62)
Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(129)
Ending Balance	$ (106)	$ (106)

Stockholders' Equity - Additional Information (Detail) - USD ($) $ / shares in Units, shares in Millions	3 Months Ended	6 Months Ended
	Jul. 01, 2017	Jul. 01, 2017	Aug. 31, 2016	May 31, 2016
Shareholders Equity [Line Items]
Stock repurchase program, shares purchased	2	4
Stock repurchase program, shares purchased at cost	$ 7,000,000	$ 17,000,000
Stock repurchase program, remaining authorized repurchase amount	$ 101,000,000	$ 101,000,000
Dividend on common stock	$ 0.025	$ 0.050
Payments of ordinary dividends, common stock	$ 13,000,000	$ 26,000,000
Maximum
Shareholders Equity [Line Items]
Stock repurchase program, authorized amount			$ 250,000,000	$ 100,000,000

Calculation of Net Earnings (Loss) Per Common Share (Detail) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Earnings Per Share [Line Items]
Net income from continuing operations	$ 21	$ 232	$ 95	$ 294
Income (loss) from discontinued operations, net of tax	3	(22)	45	(38)
Net income	$ 24	$ 210	$ 140	$ 256
Weighted-average shares outstanding	518	550	517	550
Basic earnings (loss) per share:
Continuing operations	$ 0.04	$ 0.42	$ 0.18	$ 0.53
Discontinued operations	0.01	(0.04)	0.09	(0.07)
Net earnings per share	$ 0.05	$ 0.38	$ 0.27	$ 0.47
Net income from continuing operations	$ 21	$ 232	$ 95	$ 294
Income (loss) from discontinued operations, net of tax	3	(22)	45	(38)
Net income	$ 24	$ 210	$ 140	$ 256
Weighted-average shares outstanding	518	550	517	550
Stock options and restricted stock	14	10	15	7
Diluted weighted-average shares outstanding	532	560	532	557
Diluted earnings (loss) per share
Continuing operations	$ 0.04	$ 0.41	$ 0.18	$ 0.53
Discontinued operations	0.01	(0.04)	0.08	(0.07)
Net diluted earnings per share	$ 0.05	$ 0.38	$ 0.26	$ 0.46

Earnings Per Share - Additional Information (Detail) - shares shares in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Nonvested Stock Options and Shares
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items]
Shares excluded from computation of diluted earnings per share	4	7	4	8

Components of Net Periodic Pension Benefit (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
North America
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 1	$ 2	$ 3	$ 4
Interest cost	9	12	19	23
Expected return on plan assets	(12)	(14)	(24)	(28)
Net periodic pension benefit	(2)		(2)	(1)
United Kingdom
Defined Benefit Plan Disclosure [Line Items]
Service cost	0	0	0	0
Interest cost	1	2	3	4
Expected return on plan assets	(3)	(3)	(6)	(6)
Net periodic pension benefit	$ (2)	$ (1)	$ (3)	$ (2)

Employee Benefit Plans - Additional Information (Detail) $ in Millions	6 Months Ended
	Jul. 01, 2017 USD ($)
North America
Defined Benefit Plan Disclosure [Line Items]
Pension and other postretirement contributions, remainder of fiscal year	$ 14
Pension and other postretirement contributions, current period	1
Voluntary contribution	13
United Kingdom
Defined Benefit Plan Disclosure [Line Items]
Pension and other postretirement contributions, remainder of fiscal year	1
Pension and other postretirement contributions, current period	$ 1

Assets and Liabilities Adjusted to Fair Value on Recurring Basis (Detail) - USD ($) $ in Millions	Jul. 01, 2017	Dec. 31, 2016
Money Market Funds \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Assets, fair value disclosure, recurring	$ 139	$ 135

Fair Value Measurements - Additional Information (Detail) - USD ($)	3 Months Ended	6 Months Ended
	Jul. 01, 2017	Jul. 01, 2017	Dec. 31, 2016
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Asset impairment charges	$ 1,000,000	$ 1,000,000
Derivative Fuel Contracts Payable \| Maximum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Accrued expenses and other liabilities	$ 1,000,000	$ 1,000,000	$ 1,000,000

Schedule of Fair Value of Assets and Liabilities (Detail) - USD ($) $ in Millions	Jul. 01, 2017	Dec. 31, 2016
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Timber notes receivable	$ 881	$ 884
Company-owned life insurance	87	89
Recourse Debt \| Revenue bonds, due in varying amounts periodically through 2029
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	186	181
Recourse Debt \| American & Foreign Power Company, Inc. 5% debentures, due 2030
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	14	12
Non-Recourse Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	793	800
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Timber notes receivable	874	885
Company-owned life insurance	87	89
Carrying Value \| Recourse Debt \| Revenue bonds, due in varying amounts periodically through 2029
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	186	186
Carrying Value \| Recourse Debt \| American & Foreign Power Company, Inc. 5% debentures, due 2030
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	14	14
Carrying Value \| Non-Recourse Debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, fair value	$ 787	$ 798

Schedule of Fair Value of Assets and Liabilities (Parenthetical) (Detail) - Recourse Debt	6 Months Ended	12 Months Ended
	Jul. 01, 2017	Dec. 31, 2016
Revenue bonds, due in varying amounts periodically through 2029 \| Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, due date	2029	2029
Revenue bonds, due in varying amounts periodically through 2029 \| Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, due date	2029	2029
American & Foreign Power Company, Inc. 5% debentures, due 2030 \| Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, interest rate	5.00%	5.00%
Long-term debt, due date	2030	2030
American & Foreign Power Company, Inc. 5% debentures, due 2030 \| Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, interest rate	5.00%	5.00%
Long-term debt, due date	2030	2030

Commitments and Contingencies - Additional Information (Detail) $ in Millions	6 Months Ended
	Jul. 01, 2017 USD ($)
Minimum
Commitments and Contingencies Disclosure [Line Items]
Losses for environmental liabilities	$ 10
Maximum
Commitments and Contingencies Disclosure [Line Items]
Losses for environmental liabilities	$ 25

Segment Information - Additional Information (Detail) $ in Millions	6 Months Ended
	Jul. 01, 2017 USD ($) Segment	Dec. 31, 2016 USD ($)
Segment Reporting Information [Line Items]
Number of operating segments \| Segment	2
Goodwill	$ 363	$ 363
Retail Division
Segment Reporting Information [Line Items]
Goodwill	78
Business Solutions Division
Segment Reporting Information [Line Items]
Goodwill	$ 285

Reconciliation of Revenue from Segments to Consolidated (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Segment Reporting Information [Line Items]
Sales	$ 2,363	$ 2,583	$ 5,039	$ 5,459
Retail Division
Segment Reporting Information [Line Items]
Sales	1,111	1,249	2,469	2,755
Business Solutions Division
Segment Reporting Information [Line Items]
Sales	1,248	1,330	2,563	2,698
Other
Segment Reporting Information [Line Items]
Sales	$ 4	$ 4	$ 7	$ 6

Division Operating Income (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
Division Operating Income (Detail) - USD ($) $ in Millions	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	$ 46	$ 271	$ 173	$ 356
Operating Segments
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	83	95	252	243
Operating Segments \| Retail Division
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	20	30	132	132
Operating Segments \| Business Solutions Division
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	64	63	122	109
Operating Segments \| Other
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	$ (1)	$ 2	$ (2)	$ 2

Reconciliation of Measure of Division Operating Income to Consolidated Income Before Income Taxes (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 01, 2017	Jun. 25, 2016	Jul. 01, 2017	Jun. 25, 2016
Segment Reporting Information [Line Items]
Operating income	$ 46	$ 271	$ 173	$ 356
Asset impairments	(1)		(1)
Merger, restructuring and other operating income (expenses), net	(20)	193	(40)	154
Unallocated expenses	(16)	(17)	(38)	(41)
Interest income	6	6	12	11
Interest expense	(14)	(23)	(27)	(44)
Other expense, net	(3)		(2)
Income from continuing operations before income taxes	35	254	156	323
Operating Segments
Segment Reporting Information [Line Items]
Operating income	$ 83	$ 95	$ 252	$ 243