|9 Months Ended|
Jun. 28, 2015
|Notes to Financial Statements [Abstract]|
Note 4 — Stockholders’ Equity
Changes in stockholders’ equity for the nine months ended June 28, 2015 were as follows (in millions):
Accumulated Other Comprehensive Income. Changes in the components of accumulated other comprehensive income, net of income taxes, in Qualcomm stockholders’ equity during the nine months ended June 28, 2015 were as follows (in millions):
In the third quarter of fiscal 2015, the Company entered into U.S. Treasury rate locks in anticipation of its debt offering (Note 5), which were designated as cash flow hedges. This resulted in the deferral of gains of $56 million in accumulated other comprehensive income, which will be recognized over the 10- and 30-year lives of the underlying notes associated with the U.S. Treasury rate locks. Reclassifications from accumulated other comprehensive income related to available-for-sale securities and foreign currency translation adjustments of $48 million and $166 million for the three and nine months ended June 28, 2015, respectively, and $163 million and $287 million for the three and nine months ended June 29, 2014, respectively, were recorded in investment income, net (Note 2). Reclassifications from accumulated other comprehensive income related to derivative instruments of $7 million and $20 million for the three and nine months ended June 29, 2014, respectively, were recorded in revenues, cost of equipment and services revenues, research and development expenses and selling, general and administrative expenses.
Stock Repurchase Program. On March 9, 2015, the Company announced a stock repurchase program authorizing it to repurchase up to $15 billion of the Company’s common stock. The stock repurchase program has no expiration date.
In May 2015, the Company entered into two accelerated share repurchase agreements (ASR Agreements) with two financial institutions under which the Company paid an aggregate of $5.0 billion upfront to the financial institutions and received from them an initial delivery of 57,737,000 shares of the Company’s common stock, which were retired and recorded as a $4.0 billion reduction to stockholders’ equity. The final number of shares to be repurchased will be based on the volume-weighted average stock price of the Company’s common stock during the terms of the transactions, less a discount and subject to adjustments pursuant to the terms and conditions of the ASR Agreements, and will also be retired upon delivery to the Company and recorded as a reduction to stockholders’ equity. This is evaluated as an unsettled forward contract indexed to the Company’s own stock, with $1.0 billion classified within stockholders’ equity. At settlement, under certain circumstances, one or both of the financial institutions may be required to deliver additional shares of common stock to the Company, or under certain circumstances, the Company may be required to deliver shares of common stock or to make a cash payment to one or both of the financial institutions, with the method of settlement at the Company’s election. The final settlement of the transactions under the ASR Agreements is scheduled to occur in November 2015 but may occur earlier in certain circumstances.
During the nine months ended June 28, 2015 and June 29, 2014, the Company repurchased and retired an additional 56,652,000 and 44,609,000 shares of common stock, respectively, for $4.0 billion and $3.4 billion, respectively, before commissions. To reflect share repurchases in the condensed consolidated balance sheet, the Company (i) reduces common stock for the par value of the shares, (ii) reduces paid-in capital for the amount in excess of par to zero during the quarter in which the shares are repurchased and (iii) records the residual amount to retained earnings. At June 28, 2015, $9.1 billion remained authorized for repurchase under the Company’s stock repurchase program. Since June 28, 2015, the Company repurchased and retired 8,018,000 shares of common stock for $510 million.
Dividends. On July 7, 2015, the Company announced a cash dividend of $0.48 per share on the Company’s common stock, payable on September 23, 2015 to stockholders of record as of the close of business on September 2, 2015. During the nine months ended June 28, 2015 and June 29, 2014, dividends charged to retained earnings were as follows (in millions, except per share data):
The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.
Reference 1: http://www.xbrl.org/2003/role/presentationRef