Quarterly report pursuant to Section 13 or 15(d)

Marketable Securities (Notes)

v3.7.0.1
Marketable Securities (Notes)
 9 Months Ended
Jun. 25, 2017
Marketable Securities [Abstract]  
Marketable Securities
Marketable Securities
Marketable securities were comprised as follows (in millions):
 
Current
 
Noncurrent
 
June 25,
2017
 
September 25,
2016
 
June 25,
2017
 
September 25,
2016
Available-for-sale:
 
 
 
 
 
 
 
U.S. Treasury securities and government-related securities
$
2,738

 
$
1,116

 
$
101

 
$
1,099

Corporate bonds and notes
2,769

 
10,159

 
15,053

 
8,584

Mortgage- and asset-backed and auction rate securities
104

 
1,363

 
894

 
534

Equity and preferred securities and equity funds
32

 
64

 
—

 
1,682

Debt funds
106

 
—

 
341

 
1,803

Total available-for-sale
5,749

 
12,702

 
16,389

 
13,702

Time deposits
205

 
—

 
500

 
—

Total marketable securities
$
5,954

 
$
12,702

 
$
16,889

 
$
13,702


At June 25, 2017, marketable securities also included $705 million of time deposits with original maturities that range from 91 to 181 days.
At June 25, 2017, the contractual maturities of available-for-sale debt securities were as follows (in millions):
Years to Maturity
 
 
 
 
Less Than
One Year
 
One to
Five Years
 
Five to
Ten Years
 
Greater Than
Ten Years
 
No Single
Maturity
Date
 
Total
$
9,705

 
$
9,910

 
$
1,046

 
$
1

 
$
1,444

 
$
22,106


Debt securities with no single maturity date included debt funds, mortgage- and asset-backed securities and auction rate securities.
The Company recorded realized gains and losses on sales of available-for-sale securities as follows (in millions):
 
Gross Realized Gains
 
Gross Realized Losses
 
Net Realized Gains
For the three months ended
 
 
 
 
 
June 25, 2017
$
119

 
$
(8
)
 
$
111

June 26, 2016
62

 
(8
)
 
54

 
 
 
 
 
 
For the nine months ended
 
 
 
 
 
June 25, 2017
$
422

 
$
(116
)
 
$
306

June 26, 2016
146

 
(30
)
 
116


Available-for-sale securities were comprised as follows (in millions):
 
Cost
 
Unrealized Gains
 
Unrealized Losses
 
Fair Value
June 25, 2017
 
 
 
 
 
 
 
Equity securities
$
5

 
$
27

 
$
—

 
$
32

Debt securities (including debt funds)
21,981

 
136

 
(11
)
 
22,106

 
$
21,986

 
$
163

 
$
(11
)
 
$
22,138

September 25, 2016
 
 
 
 
 
 
 
Equity securities
$
1,554

 
$
204

 
$
(12
)
 
$
1,746

Debt securities (including debt funds)
24,363

 
388

 
(93
)
 
24,658

 
$
25,917

 
$
592

 
$
(105
)
 
$
26,404


The following table shows the gross unrealized losses and fair values of the Company’s investments in individual securities that are classified as available-for-sale and have been in a continuous unrealized loss position deemed to be temporary for less than 12 months and for more than 12 months, aggregated by investment category (in millions):
 
June 25, 2017
 
Less than 12 months
 
More than 12 months
 
Fair Value
 
Unrealized Losses
 
Fair Value
 
Unrealized Losses
U.S. Treasury securities and government-related securities
$
205

 
$
(3
)
 
$
—

 
$
—

Corporate bonds and notes
1,680

 
(8
)
 
5

 
—

Mortgage- and asset-backed and auction rate securities
51

 
—

 
41

 
—

 
$
1,936

 
$
(11
)
 
$
46

 
$
—

 
September 25, 2016
 
Less than 12 months
 
More than 12 months
 
Fair Value
 
Unrealized Losses
 
Fair Value
 
Unrealized Losses
U.S. Treasury securities and government-related securities
$
444

 
$
(5
)
 
$
16

 
$
—

Corporate bonds and notes
2,775

 
(12
)
 
1,033

 
(65
)
Mortgage- and asset-backed and auction rate securities
337

 
(3
)
 
211

 
(2
)
Equity and preferred securities and equity funds
312

 
(4
)
 
130

 
(8
)
Debt funds
—

 
—

 
309

 
(6
)
 
$
3,868

 
$
(24
)
 
$
1,699

 
$
(81
)

In connection with the pending NXP transaction (Note 8), the Company has begun, and expects to continue, to divest a substantial portion of its marketable securities portfolio in order to finance, in part, that transaction. Marketable securities that were expected to be used to finance the NXP transaction were classified as noncurrent at June 25, 2017 as they are not considered available for current operations. Given the change in the Company’s intention to sell certain marketable securities, the Company recognized other-than-temporary impairment losses in the nine months ended June 25, 2017 for certain marketable securities (Note 2) and may recognize additional losses prior to the sale of such marketable securities. For the remaining available-for-sale securities, which are not expected to be sold to finance the NXP transaction, the Company concluded that the unrealized losses were temporary at June 25, 2017. Further, for debt securities and preferred stock with unrealized losses, the Company did not have the intent to sell, nor was it more likely than not that the Company would be required to sell, such securities before recovery or maturity.