Document and Entity Information Document	3 Months Ended
Document and Entity Information Document	Mar. 31, 2018 shares
Document Information [Abstract]
Entity Registrant Name	QVC INC
Entity Central Index Key	0001254699
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding	1
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q1
Amendment Flag	false
Entity Current Reporting Status submitted electronically	Yes

Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Current assets:
Cash and cash equivalents	$ 348	$ 260
Restricted cash	8	8
Accounts receivable, less allowance for doubtful accounts of $87 at March 31, 2018 and $91 at December 31, 2017	1,042	1,388
Inventories	1,073	1,019
Prepaid expenses and other current assets	134	51
Total current assets	2,605	2,726
Noncurrent assets:
Property and equipment, net of accumulated depreciation of $1,235 at March 31, 2018 and $1,174 at December 31, 2017	1,024	1,005
Television distribution rights, net	82	78
Goodwill	5,109	5,075
Other intangible assets, net	2,597	2,605
Other noncurrent assets	67	61
Total assets	11,484	11,550
Current liabilities:
Current portion of debt and capital lease obligations	18	17
Accounts payable-trade	664	756
Accrued liabilities	789	872
Total current liabilities	1,471	1,645
Noncurrent liabilities:
Long-term portion of debt and capital lease obligations	5,098	5,173
Deferred income taxes	480	473
Other long-term liabilities	118	117
Total liabilities	7,167	7,408
QVC, Inc. stockholder's equity:
Common stock, $0.01 par value, 1 authorized share	0	0
Additional paid-in capital	7,039	6,897
Accumulated deficit	(2,797)	(2,772)
Accumulated other comprehensive loss	(30)	(93)
Total QVC, Inc. stockholder's equity	4,212	4,032
Noncontrolling interest	105	110
Total equity	4,317	4,142
Total liabilities and equity	$ 11,484	$ 11,550

Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Millions	Mar. 31, 2018	Dec. 31, 2017
Allowance for doubtful accounts	$ 87	$ 91
Accumulated depreciation	$ 1,235	$ 1,174
Common stock par value	$ 0.01	$ 0.01
Common Stock, Shares Authorized	1	1

Consolidated Statements of Operations - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Net revenue	$ 2,093	$ 1,965
Operating costs and expenses:
Cost of goods sold (exclusive of depreciation and amortization shown separately below)	1,320	1,243
Operating	145	137
Selling, general and administrative, including transaction related costs and stock-based compensation	208	157
Depreciation	38	41
Amortization	39	116
Operating expenses	1,750	1,694
Operating income	343	271
Other (expense) income:
Equity in income (losses) of investee	1	(2)
Interest expense, net	(57)	(55)
Foreign currency loss	(1)	(2)
Nonoperating expense	(57)	(59)
Income before income taxes	286	212
Income tax expense	(79)	(77)
Net income	207	135
Less net income attributable to the noncontrolling interest	(11)	(11)
Net income attributable to QVC, Inc. stockholder	$ 196	$ 124

Consolidated Statements of Comprehensive Income Statement - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Net income	$ 207	$ 135
Foreign currency translation adjustments, net of tax	70	27
Total comprehensive income	277	162
Comprehensive income attributable to noncontrolling interest	(18)	(17)
Comprehensive income attributable to QVC, Inc. stockholder	$ 259	$ 145

Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Net income	$ 207	$ 135
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in (income) losses of investee	(1)	2
Deferred income taxes	6	(22)
Foreign currency loss	1	2
Depreciation	38	41
Amortization	39	116
Change in fair value of financial instruments and noncash interest	2	2
Stock-based compensation	9	6
Change in other long-term liabilities	1	(1)
Effects of changes in working capital items	47	176
Net cash provided by operating activities	349	457
Investing activities:
Capital expenditures	(36)	(17)
Expenditures for television distribution rights	(20)	(1)
Changes in other noncurrent assets	0	(3)
Other investing activities		0
Net cash used in investing activities	(56)	(21)
Financing activities:
Principal payments of debt and capital lease obligations	(967)	(650)
Principal borrowings of debt from senior secured credit facility	872	454
Capital contribution received from Qurate Retail, Inc.	140	0
Dividends paid to Qurate Retail, Inc.	(233)	(183)
Dividends paid to noncontrolling interest	(23)	(22)
Other financing activities	(7)	(4)
Net cash used in financing activities	(218)	(405)
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash	13	9
Net increase in cash, cash equivalents and restricted cash	88	40
Cash, cash equivalents and restricted cash, end of period	348
Cash, cash equivalents and restricted cash, beginning of period	268	294
Cash, cash equivalents and restricted cash, end of period	356	334
Effects of changes in working capital items:
Decrease in accounts receivable	352	333
Increase in inventories	(67)	(66)
Increase in prepaid expenses and other current assets	(88)	(11)
Decrease in accounts payable-trade	(101)	(62)
Decrease in accrued liabilities and other	(49)	(18)
Effects of changes in working capital items	$ 47	$ 176

Consolidated Statement of Equity - 3 months ended Mar. 31, 2018 - USD ($) $ in Millions	Total	Common stock	Additional paid-in capital	Accumulated deficit	Accumulated other comprehensive loss	Noncontrolling interest
Balance, December 31, 2017 at Dec. 31, 2017	$ 4,142	$ 0	$ 6,897	$ (2,772)	$ (93)	$ 110
Balance beginning (in shares) at Dec. 31, 2017		1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	207		0	196	0	11
Foreign currency translation adjustments, net of tax	70		0	0	63	7
Capital contribution received from Qurate Retail, Inc.	140		140	0	0	0
Dividends paid to Qurate Retail, Inc. and noncontrolling interest and other	(256)		0	(233)	0	(23)
Impact of tax liability allocation and indemnification agreement with Qurate Retail, Inc.	(1)		0	(1)	0	0
Withholding taxes on net share settlements of stock-based compensation	(7)		(7)	0	0	0
Stock-based compensation	9		9	0	0	0
Balance, March 31, 2018 at Mar. 31, 2018	4,317	$ 0	7,039	(2,797)	(30)	105
Balance ending (in shares) at Mar. 31, 2018		1
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Prior period adjustments due to adoption of new accounting pronouncements	$ 13		$ 0	$ 13	$ 0	$ 0

Basis of Presentation

3 Months Ended

Mar. 31, 2018

Basis of Presentation [Abstract]

Basis of presentation

Basis of Presentation

QVC, Inc. and its consolidated subsidiaries ("QVC" or the "Company") is a retailer of a wide range of consumer products, which are marketed and sold primarily by merchandise-focused televised shopping programs, the Internet and mobile applications.

In the United States ("U.S."), QVC's televised shopping programs, including live and recorded content, are broadcast across multiple channels nationally on a full-time basis, including QVC, QVC2 and Beauty iQ. The Company's U.S. programming is also available on QVC.com, QVC's U.S. website; mobile applications via streaming video; over-the-air broadcasters; and over-the-top content platforms (Roku, Apple TV, Facebook, etc.).

QVC believes that the Company's digital platforms complement the Company's televised shopping programs by allowing consumers to purchase a wide assortment of goods offered on QVC's televised programs, as well as other products that are available only on the Company's digital platforms. The Company views e-commerce as a natural extension of the Company's business, allowing the Company to stream live video and offer on-demand video segments of items recently presented live on QVC's televised programs. The Company's digital platforms allow shoppers to browse, research, compare and perform targeted searches for products, control the order-entry process and conveniently access their QVC account.

QVC's international televised shopping programs, including live and recorded content, are distributed to households outside of the U.S., primarily in Germany, Austria, Japan, the United Kingdom ("U.K."), the Republic of Ireland, Italy and France. In some of the countries where QVC operates, QVC's televised shopping programs are broadcast across multiple QVC channels: QVC Beauty & Style and QVC2 in Germany and QVC Beauty, QVC Extra, QVC Style in the U.K. The programming created for most of these markets is also available via streaming video on QVC's digital platforms. QVC's international business employs product sourcing teams who select products tailored to the interests of each local market.

The Company's Japanese operations ("QVC-Japan") are conducted through a joint venture with Mitsui & Co., LTD ("Mitsui"). QVC-Japan is owned 60% by the Company and 40% by Mitsui. The Company and Mitsui share in all profits and losses based on their respective ownership interests. During the three months ended March 31, 2018 and 2017, QVC-Japan paid dividends to Mitsui of $23 million and $22 million, respectively.

The Company also has a joint venture with CNR Media Group, formerly known as China Broadcasting Corporation, a limited liability company owned by China National Radio (''CNR''). The Company owns a 49% interest in a CNR subsidiary, CNR Home Shopping Co., Ltd. (''CNRS''). CNRS operates a retail business in China through a shopping television channel with an associated website. This joint venture is accounted for as an equity method investment recorded as equity in income (losses) of investee in the condensed consolidated statements of operations.

The Company is an indirect wholly-owned subsidiary of Qurate Retail, Inc. ("Qurate Retail") (formerly Liberty Interactive Corporation) (Nasdaq: QTREA and QRTEB), which owns interests in a broad range of digital commerce businesses, including Qurate Retail's other wholly-owned subsidiaries HSN, Inc. ("HSN") and zulily, llc ("zulily"), as well as other minority investments. QVC is part of the Qurate Retail Group, formerly QVC Group, a portfolio of brands including QVC, HSN, zulily and the Cornerstone brands. On March 9, 2018, Qurate Retail, GCI Liberty, Inc. ("GCI Liberty") (formerly General Communication, Inc.), an Alaska corporation, and Liberty Interactive LLC, a Delaware limited liability company and a direct wholly-owned subsidiary of Qurate Retail completed the previously announced transactions whereby Qurate Retail acquired GCI Liberty through a reorganization in which certain assets and liabilities attributed to Qurate Retail’s Ventures Group were contributed to GCI Liberty in exchange for a controlling interest in GCI Liberty. Qurate Retail then effected a tax-free separation of its controlling interest in the combined company. Qurate Retail's QVC Group common stock became the only outstanding common stock of Qurate Retail.

On October 1, 2015, Qurate Retail acquired all of the outstanding shares of zulily (now known as zulily, llc). zulily is an online retailer offering customers a fun and entertaining shopping experience with a fresh selection of new product styles launched each day for a limited time period. The Company believes that its business is complementary to the Company. zulily is not part of the results of operations or financial position of QVC presented in these condensed consolidated financial statements. During each of the three months ended March 31, 2018 and 2017, QVC and zulily engaged in multiple transactions relating to sales, sourcing of merchandise, marketing initiatives and business advisory services. The gross value of these transactions totaled $3 million and $2 million for the three months ended March 31, 2018 and 2017, respectively, which did not have a material impact on QVC's financial position, results of operations, or liquidity.

On June 23, 2016, QVC amended and restated its senior secured credit facility (the "Third Amended and Restated Credit Agreement") increasing the revolving credit facility from $2.25 billion to $2.65 billion as explained further in note 6. The Third Amended and Restated Credit Agreement includes a $400 million tranche that may be borrowed by QVC or zulily. Under the terms of the Third Amended and Restated Credit Agreement, QVC and zulily are jointly and severally liable for all amounts borrowed on the $400 million tranche. In accordance with the accounting guidance for obligations resulting from joint and several liability arrangements, QVC will record a liability for amounts it has borrowed under the credit facility plus any additional amount it expects to repay on behalf of zulily. As of March 31, 2018, there were no loans outstanding by zulily on the $400 million tranche of the Third Amended and Restated Credit Agreement.

On December 29, 2017, Qurate Retail completed the acquisition of the remaining 62% ownership interest of HSN in an all-stock transaction. HSN is not included in the results of operations or financial position of QVC presented in the Company's condensed consolidated financial statements. During the three months ended March 31, 2018, QVC and HSN engaged in transactions relating to personnel, sales, sourcing of merchandise, marketing initiatives, business advisory services, and software development. The gross value of these transactions totaled $5 million, which did not have a material impact on QVC's financial position, results of operations, or liquidity.

The condensed consolidated financial statements include the accounts of QVC, Inc. and its majority-owned subsidiaries. All significant intercompany accounts and transactions were eliminated in consolidation.

The accompanying (a) condensed consolidated balance sheet as of December 31, 2017, which has been derived from audited financial statements, and (b) the interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results for such periods have been included. The results of operations for any interim period are not necessarily indicative of results for the full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in QVC's Annual Report on Form 10-K for the year ended December 31, 2017.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Estimates include, but are not limited to, sales returns, uncollectible receivables, inventory obsolescence, medical and other benefit related costs, depreciable lives of fixed assets, internally-developed software, valuation of acquired intangible assets and goodwill, income taxes and stock‑based compensation.

Adoption of new accounting pronouncements

On May 28, 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. This new guidance also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In March 2016, the FASB issued ASU No. 2016-08 which clarifies principal versus agent considerations, in April 2016, the FASB issued ASU No. 2016-10 which clarifies the identification of performance obligations and the implementation guidance for licensing, and in May 2016, the FASB issued ASU No. 2016-12 which clarifies assessing collectibility, presentation of sales taxes, noncash consideration, and completed contracts and contract modifications at transition. On January 1, 2018, the Company adopted the new accounting standard ASC 606, Revenue from Contracts with Customers and all the related amendments (“ASC 606”) to all contracts using the modified retrospective method. The Company recognized the cumulative effect of initially applying the new revenue standard as a $14 million adjustment to the opening balance of retained earnings. The comparative information has not been restated and continues to be reported under the accounting standards in effect for those periods. The Company does not expect the adoption of the new revenue standard to have a material impact to its net income on an ongoing basis. Refer to the table below for the adoption of this guidance.

In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, which requires an entity to recognize at the transaction date the income tax consequences of intercompany asset transfers other than inventory. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The Company has adopted this guidance on January 1, 2018 and there was no significant effect of the standard on its condensed consolidated financial statements.

The cumulative effect of the changes due to the adoption of ASC 606 and ASU No. 2016-16 were as follows:



(in millions)	Balance at December 31, 2017			Adjustments Due to ASC 606			Adjustments Due to ASU 2016-16			Balance at January 1, 2018
Assets:
Inventories	$	1,019		$	(22	)	$	—		$	997
Prepaid expenses and other current assets	51			—			(1		)	50

Liabilities:
Accrued liabilities	872			(36		)	—			836

Equity:
Accumulated deficit	(2,772		)	14			(1		)	(2,759		)

In accordance with the new revenue standard requirements, the impact of adoption on our condensed consolidated statement of operations was as follows:



Statement of Operations	Three months ended March 31, 2018
(in millions)	As Reported			Balances Without Adoption of ASC 606			Effect of Change Increase/(Decrease)
Net revenue	$	2,093		$	2,044		$	49

Costs and expenses:
Cost of goods sold	1,320			1,310			10
Operating	145			144			1
Selling, general and administrative, including transaction related costs and stock-based compensation	208			182			26

Income tax expense	(79		)	(76		)	3

Net income	207			198			9

The effect of changes of adoption is primarily due to the timing of revenue recognition and the classification of income for its QVC-branded credit card ("Q-Card Income"). For the three months ended March 31, 2018, revenue is recognized at the time of shipment to the Company's customers consistent with when control passes and Q-Card Income is recognized in revenue. For the three months ended March 31, 2017, revenue was recognized at the time of delivery to the customers and deferred revenue, as well as related expenses, were recorded to account for the shipments in-transit. In addition, Q-Card Income was recognized as an offset to selling, general and administrative expenses. The Company also recognized a separate $74 million asset (included in prepaid expenses and other current assets) related to the expected return of inventory and a $159 million liability (included in accrued liabilities) relating to its sales return reserve at March 31, 2018, instead of the net presentation of the liability that was reported at December 31, 2017 and March 31, 2017.

In January 2016, the FASB issued ASU No. 2016-01, Financial Statements - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which requires equity investments with readily determinable fair values (except those accounted for under the equity method of accounting or those that result in consolidation) to be measured at fair value with changes in fair value recognized in net income and simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. The new standard is effective for the Company for fiscal years and interim periods beginning after December 15, 2017. The Company has adopted this guidance during the first quarter of 2018, and there was no significant effect of the standard on its financial reporting.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments, which addresses eight specific cash flow issues to reduce the diversity in practice for appropriate classification on the statement of cash flows. The amendments in this ASU are effective for annual periods, and interim periods within those annual periods, beginning after December 15, 2017 with early adoption permitted. The Company has adopted this guidance during the first quarter of 2018 and there was no significant effect of the standard on its condensed consolidated financial statements.

In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which requires entities to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows. The guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The Company has adopted this guidance during the first quarter of 2018, and has reclassified prior period balances in cash and cash equivalents within the condensed consolidated statements of cash flows in order to conform with current period presentation.

In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting, to provide clarity to which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. The amendments in this update are effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017 with early adoption permitted. The Company has adopted this guidance during the first quarter of 2018 and there was no significant effect of the standard on its condensed consolidated financial statements.

Accounting pronouncements issued but not yet adopted

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which revises the accounting related to lessee accounting. Under the new guidance, lessees will be required to recognize a lease liability and a right-of-use asset for all leases. The new lease guidance also simplifies the accounting for sale and leaseback transactions primarily because lessees must recognize lease assets and lease liabilities. The amendments in this ASU are effective for the Company beginning on January 1, 2019 and should be applied through a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. Early adoption is permitted. While the Company is currently evaluating the effect that the updated standard will have on its ongoing financial reporting, it expects that the operating leases listed in note 7 - Leases will be recognized as right-of-use assets and operating lease liabilities on the consolidated balance sheets upon adoption of the new standard.

In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220), which addresses the effect of the change in the U.S. federal corporate tax rate due to the enactment of the December 22, 2017 Tax Cuts and Jobs Act (the "Tax Act") on items within accumulated other comprehensive income (loss). The guidance will be effective for the Company in the first quarter of 2019 with early adoption permitted. The Company is currently assessing the impact that adopting this new accounting standard will have on its consolidated financial statements.

Television Distribution Rights, Net

3 Months Ended

Mar. 31, 2018

Television Distribution Rights [Abstract]

Television Distribution Rights, Net

Television distribution rights consisted of the following:



(in millions)	March 31, 2018			December 31, 2017
Television distribution rights	$	763		730
Less accumulated amortization	(681		)	(652	)
Television distribution rights, net	$	82		78

The Company recorded amortization expense of $16 million and $50 million for the three months ended March 31, 2018 and 2017, respectively, related to television distribution rights. The decrease in amortization expense for the three months ended March 31, 2018 is primarily due to the end of affiliation agreement terms for contracts in place at the time of Qurate Retail's acquisition of QVC in 2003.

As of March 31, 2018, related amortization expense for each of the next five years ended December 31 was as follows (in millions):



Remainder of 2018	$	35
2019	26
2020	14
2021	4
2022	3

Other Intangible Assets, Net

3 Months Ended

Mar. 31, 2018

Other Intangible Assets [Abstract]

Intangible assets disclosure

Other Intangible Assets, Net

Other intangible assets consisted of the following:



	March 31, 2018					December 31, 2017
(in millions)	Gross cost		Accumulated amortization		Other intangible assets, net	Gross cost	Accumulated amortization		Other intangible assets, net
Purchased and internally developed software	$	727	(571	)	156	710	(548	)	162
Affiliate and customer relationships	2,424		(2,416	)	8	2,419	(2,409	)	10
Debt origination fees	8		(3	)	5	8	(3	)	5
Trademarks (indefinite life)	2,428		—		2,428	2,428	—		2,428
	$	5,587	(2,990	)	2,597	5,565	(2,960	)	2,605

The Company recorded amortization expense of $23 million and $66 million for the three months ended March 31, 2018 and 2017, respectively, related to other intangible assets. The decrease in amortization expense for the three months ended March 31, 2018 is primarily due to the end of affiliation agreement terms for contracts in place at the time of Qurate Retail's acquisition of QVC in 2003.

As of March 31, 2018, the related amortization and interest expense for each of the next five years ended December 31 was as follows (in millions):



Remainder of 2018	$	71
2019	62
2020	32
2021	4
2022	—

Accrued Liabilities

3 Months Ended

Mar. 31, 2018

Accrued Liabilities [Abstract]

Accrued liabilities

Accrued Liabilities

Accrued liabilities consisted of the following:



(in millions)	March 31, 2018		December 31, 2017
Accounts payable non-trade	$	209	279
Allowance for sales returns	159		96
Income taxes	158		128
Accrued compensation and benefits	105		119
Sales and other taxes	45		71
Accrued interest	38		58
Deferred revenue	14		58
Other	61		63
	$	789	872

Long-Term Debt

3 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Debt disclosure

Long-Term Debt and Capital Lease Obligations

Long-term debt and capital lease obligations consisted of the following:



(in millions)	March 31, 2018			December 31, 2017
3.125% Senior Secured Notes due 2019, net of original issue discount	$	399		399
5.125% Senior Secured Notes due 2022	500			500
4.375% Senior Secured Notes due 2023, net of original issue discount	750			750
4.85% Senior Secured Notes due 2024, net of original issue discount	600			600
4.45% Senior Secured Notes due 2025, net of original issue discount	599			599
5.45% Senior Secured Notes due 2034, net of original issue discount	399			399
5.95% Senior Secured Notes due 2043, net of original issue discount	300			300
Senior secured credit facility	1,405			1,496
Capital lease obligations	85			68
Build to suit lease obligation	100			101
Less debt issuance costs, net	(21		)	(22	)
Total debt and capital lease obligations	5,116			5,190
Less current portion	(18		)	(17	)
Long-term portion of debt and capital lease obligations	$	5,098		5,173

Senior Secured Notes

All of QVC's senior secured notes are secured by the capital stock of QVC and certain of its subsidiaries and have equal priority to the senior secured credit facility. The interest on all of QVC's senior secured notes is payable semi-annually.

Senior Secured Credit Facility

On June 23, 2016, QVC entered into the Third Amended and Restated Credit Agreement with zulily as borrowers (collectively, the “Borrowers”) which is a multi-currency facility that provides for a $2.65 billion revolving credit facility with a $300 million sub-limit for standby letters of credit and $1.5 billion of uncommitted incremental revolving loan commitments or incremental term loans. The Third Amended and Restated Credit Agreement includes a $400 million tranche that may be borrowed by the Company or zulily with an additional $50 million sub-limit for standby letters of credit (see note 1). The remaining $2.25 billion and any incremental loans may be borrowed only by the Company. Borrowings that are alternate base rate loans will bear interest at a per annum rate equal to the base rate plus a margin that varies between 0.25% and 0.75% depending on the Borrowers’ combined ratio of Consolidated Total Debt to Consolidated EBITDA (the “Combined Consolidated Leverage Ratio”). Borrowings that are London Interbank Offered Rate ("LIBOR") loans will bear interest at a per annum rate equal to the applicable LIBOR rate plus a margin that varies between 1.25% and 1.75% depending on the Borrowers’ Combined Consolidated Leverage Ratio. Each loan may be prepaid at any time and from time to time without penalty other than customary breakage costs. No mandatory prepayments will be required other than when borrowings and letter of credit usage exceed availability; provided that, if zulily ceases to be controlled by Qurate Retail, all of its loans must be repaid and its letters of credit cash collateralized. The facility matures on June 23, 2021, except that $140 million of the $2.25 billion commitment available to QVC matures on March 9, 2020. Any amounts prepaid on the revolving facility may be reborrowed. Payment of loans may be accelerated following certain customary events of default.

QVC had $1,235 million available under the terms of the Third Amended and Restated Credit Agreement at March 31, 2018, including the portion available under the $400 million tranche that zulily may also borrow on. The interest rate on the Third Amended and Restated Credit Agreement was 3.2% at March 31, 2018.

The payment and performance of the Borrowers’ obligations under the Third Amended and Restated Credit Agreement are guaranteed by each of QVC’s Material Domestic Subsidiaries (as defined in the Third Amended and Restated Credit Agreement). Further, the borrowings under the Third Amended and Restated Credit Agreement are secured, pari passu with QVC’s existing notes, by a pledge of all of QVC’s equity interests. The payment and performance of the Borrowers’ obligations with respect to the $400 million tranche available to both QVC and zulily are also guaranteed by each of zulily’s Material Domestic Subsidiaries (as defined in the Third Amended and Restated Credit Agreement), if any, and are secured by a pledge of all of zulily’s equity interests.

The Third Amended and Restated Credit Agreement contains certain affirmative and negative covenants, including certain restrictions on the Company and zulily and each of their respective restricted subsidiaries (subject to certain exceptions) with respect to, among other things: incurring additional indebtedness; creating liens on property or assets; making certain loans or investments; selling or disposing of assets; paying certain dividends and other restricted payments; dissolving, consolidating or merging; entering into certain transactions with affiliates; entering into sale or leaseback transactions; restricting subsidiary distributions; and limiting the Company’s consolidated leverage ratio and the Borrowers’ Combined Consolidated Leverage Ratio.

Interest Rate Swap Arrangements

During the year ended December 31, 2016, QVC entered into a three-year interest rate swap arrangement with a notional amount of $125 million to mitigate the interest rate risk associated with interest payments related to its variable rate debt. The swap arrangement does not qualify as a cash flow hedge under U.S. GAAP. Accordingly, changes in the fair value of the swap are reflected in gain on financial instruments in the accompanying condensed consolidated statements of operations. At March 31, 2018, the fair value of the swap instrument was in a net asset position of approximately $2 million which was included in other noncurrent assets.

Other Debt Related Information

QVC was in compliance with all of its debt covenants at March 31, 2018.

During the quarter, there were no significant changes to QVC's debt credit ratings.

The weighted average interest rate applicable to all of the outstanding debt (excluding capital and build to suit leases) prior to amortization of bond discounts and related debt issuance costs was 4.3% as of March 31, 2018.

Revenue (Notes)

3 Months Ended

Mar. 31, 2018

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

Revenue

Disaggregated revenue by segment and product category consisted of the following:



	Three months ended March 31, 2018
(in millions)	QVC-U.S.		QVC-International	Total
Home	$	499	260	759
Apparel	280		119	399
Beauty	239		144	383
Accessories	186		67	253
Jewelry	95		55	150
Electronics	87		26	113
Other revenue	31		5	36
Total net revenue	$	1,417	676	2,093

Consumer Product Revenue and Other Revenue

QVC's revenue includes sales of consumer products in the following categories; home, apparel, beauty, accessories, electronics and jewelry, which are primarily sold through live merchandise-focused televised shopping programs and via our websites and other interactive media.

Other revenue consists primarily of income generated from our QVC-branded credit card ("Q-Card") in which a large consumer financial services company provides revolving credit directly to QVC's customers for the sole purpose of purchasing merchandise or services with a Q-Card. In return, the Company receives a portion of the net economics of the credit card program.

Revenue Recognition

For the three months ended March 31, 2018, revenue is recognized when obligations with our customer are satisfied; generally this occurs at the time of shipment to our customers consistent with when control of the shipped product passes. The recognized revenue reflects the consideration we expect to receive in exchange for transferring goods, net of allowances for returns.

The Company generally recognizes revenue related to the Q-Card over time as the Q-Card is used by QVC's customers.

Sales, value add, use and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.

The Company has elected to treat shipping and handling activities that occur after the customer obtains control of the goods as a fulfillment cost and not as a promised good or service. Accordingly, the Company accrues the related shipping costs and recognizes revenue upon delivery of the goods to the shipping carrier. In electing this accounting policy, all shipping and handling activities will be treated as fulfillment costs.

The Company generally has payment terms with its customers of one year or less and has elected the practical expedient applicable to such contracts not to consider the time value of money.

Significant Judgments

Our products are generally sold with a right of return for up to 30 days after the date of shipment and we may provide other credits or incentives, which are accounted for as variable consideration when estimating the amount of revenue to recognize. Returns and credits are estimated at contract inception and updated at the end of each reporting period as additional information becomes available. The Company has determined that it is generally the Principal in vendor arrangements as the Company can establish control over the goods prior to shipment. Accordingly, the Company records revenue for these arrangements on a gross basis.

Lease and Transponder Service Agreements

3 Months Ended

Mar. 31, 2018

Leases [Abstract]

Leases of lessee disclosure

Leases

Future minimum payments under noncancelable operating leases and capital leases with initial terms of one year or more and the lease related to the Company's California distribution center (build to suit lease) at March 31, 2018 consisted of the following:



(in millions)	Capital leases		Operating leases	Build to suit lease
Remainder of 2018	$	12	16	3
2019	16		17	6
2020	12		14	6
2021	12		11	6
2022	10		9	6
Thereafter	31		71	58
Total	$	93	138	85

The Company has entered into fifteen separate capital lease agreements with transponder and transmitter network suppliers to transmit its signals in the U.S., Germany and France at an aggregate monthly cost of $1 million. The Company is also party to a capital lease agreement for data processing hardware. Depreciation expense related to the capital leases was $4 million and $3 million for the three months ended March 31, 2018 and 2017, respectively. Total future minimum capital lease payments of $93 million include $8 million of imputed interest. The transponder service agreements for our U.S. transponders expire between 2018 and 2023. The transponder and transmitter network service agreements for our international transponders expire between 2019 and 2027.

Expenses for operating leases, principally for data processing equipment, facilities, satellite uplink service agreements and the California distribution center land, amounted to $6 million for each of the three months ended March 31, 2018 and 2017.

On July 2, 2015, QVC entered into a lease (the “Lease”) for a California distribution center. Pursuant to the Lease, the landlord built an approximately one million square foot rental building in Ontario, California (the “Premises”), and thereafter leased the Premises to QVC as its new California distribution center for an initial term of 15 years. Under the Lease, QVC is required to pay an initial base rent of approximately $6 million per year, increasing to approximately $8 million per year by the final year of the initial term, as well as all real estate taxes and other building operating costs. QVC also has an option to extend the term of the Lease for up to two consecutive terms of 10 years each.

The Company concluded that it was the deemed owner (for accounting purposes only) of the Premises during the construction period under build to suit lease accounting.

QVC has the right to purchase the Premises and related land from the landlord by entering into an amended and restated agreement at any time during the twenty-fifth or twenty-sixth months of the Lease's initial term, which will occur in June and July of 2018, with a $10 million initial payment and annual payments of $12 million over a term of 13 years.

On August 29, 2016, the California distribution center officially opened. The Company evaluated whether the Lease met the criteria for "sale-leaseback" treatment under U.S. GAAP and concluded that it did not. Therefore, the Company treats the Lease as a financing obligation and lease payments are attributed to: (1) a reduction of the principal financing obligation; (2) imputed interest expense; and (3) land lease expense representing an imputed cost to lease the underlying land of the Premises. In addition, the building asset is being depreciated over its estimated useful life of 20 years. Although the Company did not begin making monthly lease payments pursuant to the Lease until February 2017, the portion of the lease obligations allocated to the land has been treated for accounting purposes as an operating lease that commenced in 2015. If the Company does not exercise its right to purchase the Premises and related land, the Company will derecognize both the net book values of the asset and the financing obligation at the conclusion of the lease term.

Income Taxes	3 Months Ended
Income Taxes	Mar. 31, 2018
Income Tax Disclosure [Abstract]
Income taxes	Income Taxes The Company calculates its interim income tax provision by applying its best estimate of the annual expected effective tax rate to its ordinary year-to-date income or loss. The tax or benefit related to significant, unusual or extraordinary items that will be separately reported or reported net of their related tax effect are individually computed and recognized in the interim period in which those items occur. The computation of the annual estimated effective tax rate at each interim period requires certain estimates and significant judgment including, but not limited to, the expected operating income for the year, projections of the proportion of income earned and taxed in foreign jurisdictions, permanent and temporary differences as a result of differences between amounts measured and recognized in accordance with tax laws and financial accounting standards, and the likelihood of recovering deferred tax assets. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or as the tax environment changes. To the extent that the estimated annual effective tax rate changes during a quarter, the effect of the change on the prior quarters is included in the tax expense for the current quarter. For the three months ended March 31, 2018, the Company recorded a tax provision of $79 million, which represented an effective tax rate of 27.6%. For the three months ended March 31, 2017, the Company recorded a tax provision of $77 million, which represented an effective tax rate of 36.3%. The Tax Act, enacted in 2017, made broad and complex changes to the U.S. tax code which included a lowering of the U.S. federal corporate income tax rate from 35% to 21% effective January 1, 2018, changes in how foreign earnings are taxed in the U.S., the limitation on the deduction of net interest expense and other changes. The reduction to the 2018 effective tax rate is a result of these and other changes from the Tax Act. The 2018 rate differs from the U.S. federal income tax rate of 21% due primarily to state and foreign tax expenses. The 2017 rate differs from the U.S. federal income tax rate of 35% due primarily to state tax expense. QVC is party to ongoing discussions with the Internal Revenue Service under the Compliance Assurance Process audit program. The Company files Federal tax returns on a consolidated basis with its parent company, Qurate Retail. The Company, or one of its subsidiaries, files income tax returns in various states and foreign jurisdictions. As of March 31, 2018, certain of the Company's subsidiaries were under examination in Germany for 2012 through 2014. In addition, as of March 31, 2018, the Company, or one of its subsidiaries, was also under examination in California, New York and Pennsylvania. The Company is a party to a Tax Liability Allocation and Indemnification Agreement (the “Tax Agreement”) with Qurate Retail. The Tax Agreement establishes the methodology for the calculation and payment of income taxes in connection with the consolidation of the Company with Qurate Retail for income tax purposes. Generally, the Tax Agreement provides that the Company will pay Qurate Retail an amount equal to the tax liability, if any, that it would have if it were to file as a consolidated group separate and apart from Qurate Retail, with exceptions for the treatment and timing of certain items, including but not limited to deferred intercompany transactions, credits, and net operating and capital losses. To the extent that the separate company tax expense is different from the payment terms of the Tax Agreement, the difference is recorded as either a dividend or capital contribution. The amounts of the tax-related balances due to Qurate Retail at March 31, 2018 and December 31, 2017 were $109 million and $60 million, respectively, and were included in accrued liabilities in the accompanying condensed consolidated balance sheets.

Commitments and Contingencies	3 Months Ended
Commitments and Contingencies	Mar. 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies The Company has contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. Although it is reasonably possible the Company may incur losses upon conclusion of such matters, an estimate of any loss or range of loss cannot be made. In the opinion of management, it is expected that the amounts, if any, which may be required to satisfy such contingencies will not be material in relation to the accompanying condensed consolidated financial statements. Network and information systems, including the Internet and telecommunication systems, third party delivery services and other technologies are critical to QVC's business activities. Substantially all of QVC's customer orders, fulfillment and delivery services are dependent upon the use of network and information systems, including the use of third party telecommunication and delivery service providers. If information systems including the Internet or telecommunication services are disrupted, or if the third party delivery services experience a disruption in their transportation delivery services, the Company could face a significant disruption in fulfilling QVC's customer orders and shipment of QVC's products. The Company has active disaster recovery programs in place to help mitigate risks associated with these critical business activities.

Financial Instruments and Fair Value Measurements

3 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

Fair value disclosures

Financial Instruments and Fair Value Measurements

For assets and liabilities required to be reported or disclosed at fair value, U.S. GAAP provides a hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three broad levels. Level 1 inputs are quoted market prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs, other than quoted market prices included within Level 1, are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability.

The Company's assets and liabilities measured or disclosed at fair value were as follows:



			Fair value measurements at March 31, 2018 using
(in millions)	Total		Quoted prices in active markets for identical assets (Level 1)	Significant other observable inputs (Level 2)	Significant unobservable inputs (Level 3)
Current assets:
Cash equivalents	$	129	129	—	—
Noncurrent assets:
Interest rate swap arrangements	2		—	2	—
Long-term liabilities:
Debt (note 6)	4,974		—	4,974	—



			Fair value measurements at December 31, 2017 using
(in millions)	Total		Quoted prices in active markets for identical assets (Level 1)	Significant other observable inputs (Level 2)	Significant unobservable inputs (Level 3)
Current assets:
Cash equivalents	$	42	42	—	—
Noncurrent assets:
Interest rate swap arrangements	2		—	2	—
Long-term liabilities:
Debt (note 6)	5,132		—	5,132	—

The majority of the Company's Level 2 financial liabilities are debt instruments with quoted market prices that are not considered to be traded on "active markets," as defined in U.S. GAAP. Accordingly, the financial instruments are reported in the foregoing tables as Level 2 fair value instruments.

- 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

Information about QVC's Operating Segments

3 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Segment reporting disclosure

Information about QVC's Operating Segments

The Company has identified two reportable operating segments: QVC-U.S. and QVC-International. Both operating segments are retailers of a wide range of consumer products, which are marketed and sold primarily by merchandise-focused televised-shopping programs as well as via the Internet and mobile applications in certain markets.

QVC's chief operating decision maker ("CODM") is QVC's Chief Executive Officer. QVC's CODM has ultimate responsibility for enterprise decisions. QVC's CODM determines, in particular, resource allocation for, and monitors performance of, the consolidated enterprise, QVC-U.S. and QVC-International. The segment managers have responsibility for operating decisions, allocating resources and assessing performance within their respective segments. QVC's CODM relies on internal management reporting that analyzes enterprise results and segment results to the Adjusted OIBDA level (see below).

The Company evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as net revenue, Adjusted OIBDA, gross margin, average sales price per unit, number of units shipped and revenue or sales per subscriber equivalent. The Company defines Adjusted OIBDA as revenue less cost of goods sold, operating expenses, and selling, general and administrative expenses (excluding restructuring, integration and advisory fees incurred by QVC as a result of the acquisition of HSN by Qurate Retail on December 29, 2017 ("transaction related costs") and stock-based compensation). The Company believes this measure is an important indicator of the operational strength and performance of its segments, including the ability to service debt and fund capital expenditures. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking among the Company's businesses and identify strategies to improve performance. This measure of performance excludes depreciation, amortization, stock-based compensation and transaction related costs that are included in the measurement of operating income pursuant to U.S. GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flow provided by operating activities and other measures of financial performance prepared in accordance with U.S. GAAP.

Performance measures



	Three months ended March 31,
	2018			2017
(in millions)	Net revenue		Adjusted OIBDA	Net revenue	Adjusted OIBDA
QVC-U.S.	$	1,417	326	1,370	336
QVC-International	676		107	595	98
Consolidated QVC	$	2,093	433	1,965	434

Other information



	Three months ended March 31,
	2018			2017
(in millions)	Depreciation		Amortization	Depreciation	Amortization
QVC-U.S.	$	23	36	24	105
QVC-International	15		3	17	11
Consolidated QVC	$	38	39	41	116



	March 31, 2018			December 31, 2017
(in millions)	Total assets		Capital expenditures	Total assets	Capital expenditures
QVC-U.S.	$	9,253	21	9,429	116
QVC-International	2,231		15	2,121	36
Consolidated QVC	$	11,484	36	11,550	152

Property and equipment, net of accumulated depreciation, by segment were as follows:



(in millions)	March 31, 2018		December 31, 2017
QVC-U.S.	$	543	559
QVC-International	481		446
Consolidated QVC	$	1,024	1,005

The following table provides a reconciliation of Adjusted OIBDA to income before income taxes:



	Three months ended March 31,
(in millions)	2018			2017
Adjusted OIBDA	$	433		434
Transaction related costs	(4		)	—
Stock-based compensation	(9		)	(6	)
Depreciation and amortization	(77		)	(157	)
Equity in income (losses) of investee	1			(2	)
Interest expense, net	(57		)	(55	)
Foreign currency loss	(1		)	(2	)
Income before income taxes	$	286		212

Other Comprehensive Income

3 Months Ended

Mar. 31, 2018

Other Comprehensive Income (Loss), Net of Tax [Abstract]

Comprehensive Income (Loss)

Other Comprehensive Income

The change in the component of accumulated other comprehensive loss, net of taxes ("AOCL"), is summarized as follows:



(in millions)	Foreign currency translation adjustments			AOCL
Balance at January 1, 2018	$	(93	)	(93	)
Other comprehensive income attributable to QVC, Inc. stockholder	63			63
Balance at March 31, 2018	(30		)	(30	)

Balance at January 1, 2017	$	(224	)	(224	)
Other comprehensive income attributable to QVC, Inc. stockholder	21			21
Balance at March 31, 2017	(203		)	(203	)

The component of other comprehensive income is reflected in QVC's condensed consolidated statements of comprehensive income, net of taxes. The following table summarizes the tax effects related to the component of other comprehensive income:



(in millions)	Before-tax amount		Tax expense		Net-of-tax amount
Three months ended March 31, 2018
Foreign currency translation adjustments	$	71	(1	)	70
Other comprehensive income	71		(1	)	70

Three months ended March 31, 2017
Foreign currency translation adjustments	$	47	(20	)	27
Other comprehensive income	47		(20	)	27

Guarantor/Non-Guarantor Subsidiary Financial Information

3 Months Ended

Mar. 31, 2018

Guarantor Non-guarantor Subsidiary Financial Information [Abstract]

Guarantor/Non-guarantor Subsidiary Financial Information

The following information contains the condensed consolidating financial statements for the Company, the parent on a stand-alone basis (QVC, Inc.), the combined subsidiary guarantors (Affiliate Relations Holdings, Inc.; Affiliate Investment, Inc.; AMI 2, Inc.; ER Marks, Inc.; QVC Rocky Mount, Inc.; QVC San Antonio, LLC; QVC Global Holdings I, Inc.; and QVC Global Holdings II, Inc.) and the combined non-guarantor subsidiaries pursuant to Rule 3-10 of Regulation S-X.

In connection with the Third Amended and Restated Credit Agreement in June 2016 (see notes 1 and 6), QVC International Ltd is no longer a guarantor subsidiary, and is reflected with the combined non-guarantor subsidiaries.

These condensed consolidating financial statements have been prepared from the Company's financial information on the same basis of accounting as the Company's condensed consolidated financial statements. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions, such as management fees, royalty revenue and expense, interest income and expense and gains on intercompany asset transfers. Goodwill and other intangible assets have been allocated to the subsidiaries based on management’s estimates. Certain costs have been partially allocated to all of the subsidiaries of the Company.

The subsidiary guarantors are 100% owned by the Company. All guarantees are full and unconditional and are joint and several. There are no significant restrictions on the ability of the Company to obtain funds from its U.S. subsidiaries, including the guarantors, by dividend or loan. The Company has not presented separate notes and other disclosures concerning the subsidiary guarantors as the Company has determined that such material information is available in the notes to the Company's condensed consolidated financial statements.

Condensed Consolidating Balance Sheets



March 31, 2018
(in millions)	Parent issuer- QVC, Inc.		Combined subsidiary guarantors		Combined non-guarantor subsidiaries		Eliminations		Consolidated- QVC, Inc. and subsidiaries
Assets
Current assets:
Cash and cash equivalents	$	10	97		241		—		348
Restricted cash	5		—		3		—		8
Accounts receivable, net	761		—		281		—		1,042
Inventories	769		—		304		—		1,073
Prepaid expenses and other current assets	84		—		50		—		134
Total current assets	1,629		97		879		—		2,605
Property and equipment, net	284		58		682		—		1,024
Television distribution rights, net	—		81		1		—		82
Goodwill	4,190		—		919		—		5,109
Other intangible assets, net	532		2,048		17		—		2,597
Other noncurrent assets	15		—		52		—		67
Investments in subsidiaries	3,694		1,772		—		(5,466	)	—
Total assets	$	10,344	4,056		2,550		(5,466	)	11,484
Liabilities and equity
Current liabilities:
Current portion of debt and capital lease obligations	$	4	—		14		—		18
Accounts payable-trade	381		—		283		—		664
Accrued liabilities	223		260		306		—		789
Intercompany accounts payable (receivable)	434		(1,499	)	1,065		—		—
Total current liabilities	1,042		(1,239	)	1,668		—		1,471
Long-term portion of debt and capital lease obligations	4,942		—		156		—		5,098
Deferred income taxes	58		470		(48	)	—		480
Other long-term liabilities	90		—		28		—		118
Total liabilities	6,132		(769	)	1,804		—		7,167
Equity:
QVC, Inc. stockholder's equity	4,212		4,825		641		(5,466	)	4,212
Noncontrolling interest	—		—		105		—		105
Total equity	4,212		4,825		746		(5,466	)	4,317
Total liabilities and equity	$	10,344	4,056		2,550		(5,466	)	11,484

Condensed Consolidating Balance Sheets



December 31, 2017
(in millions)	Parent issuer- QVC, Inc.		Combined subsidiary guarantors		Combined non-guarantor subsidiaries		Eliminations		Consolidated- QVC, Inc. and subsidiaries
Assets
Current assets:
Cash and cash equivalents	$	2	33		225		—		260
Restricted cash	5		—		3		—		8
Accounts receivable, net	1,076		—		312		—		1,388
Inventories	758		—		261		—		1,019
Prepaid expenses and other current assets	28		—		23		—		51
Total current assets	1,869		33		824		—		2,726
Property and equipment, net	295		60		650		—		1,005
Television distribution rights, net	—		78		—		—		78
Goodwill	4,190		—		885		—		5,075
Other intangible assets, net	539		2,048		18		—		2,605
Other noncurrent assets	14		—		47		—		61
Investments in subsidiaries	3,579		1,626		—		(5,205	)	—
Total assets	$	10,486	3,845		2,424		(5,205	)	11,550
Liabilities and equity
Current liabilities:
Current portion of debt and capital lease obligations	$	3	—		14		—		17
Accounts payable-trade	455		—		301		—		756
Accrued liabilities	366		227		279		—		872
Intercompany accounts payable (receivable)	453		(1,513	)	1,060		—		—
Total current liabilities	1,277		(1,286	)	1,654		—		1,645
Long-term portion of debt and capital lease obligations	5,033		—		140		—		5,173
Deferred income taxes	52		468		(47	)	—		473
Other long-term liabilities	92		—		25		—		117
Total liabilities	6,454		(818	)	1,772		—		7,408
Equity:
QVC, Inc. stockholder's equity	4,032		4,663		542		(5,205	)	4,032
Noncontrolling interest	—		—		110		—		110
Total equity	4,032		4,663		652		(5,205	)	4,142
Total liabilities and equity	$	10,486	3,845		2,424		(5,205	)	11,550

Condensed Consolidating Statements of Operations



Three months ended March 31, 2018
(in millions)	Parent issuer- QVC, Inc.			Combined subsidiary guarantors		Combined non-guarantor subsidiaries		Eliminations		Consolidated- QVC, Inc. and subsidiaries
Net revenue	$	1,455		223		728		(313	)	2,093
Operating costs and expenses
Cost of goods sold (exclusive of depreciation and amortization shown separately below)	878			35		447		(40	)	1,320
Operating	102			58		74		(89	)	145
Selling, general and administrative, including transaction related costs and stock-based compensation	279			—		113		(184	)	208
Depreciation	16			3		19		—		38
Amortization	20			16		3		—		39
	1,295			112		656		(313	)	1,750
Operating income	160			111		72		—		343
Other (expense) income:
Equity in income of investee	—			—		1		—		1
Interest expense, net	(57		)	—		—		—		(57	)
Foreign currency loss	(4		)	—		3		—		(1	)
Intercompany interest (expense) income	(7		)	38		(31	)	—		—
	(68		)	38		(27	)	—		(57	)
Income before income taxes	92			149		45		—		286
Income tax expense	(22		)	(34	)	(23	)	—		(79	)
Equity in earnings of subsidiaries, net of tax	137			25		—		(162