Annual report pursuant to Section 13 and 15(d)

Composition of Certain Financial Statement Items (Tables)

v3.20.2
Composition of Certain Financial Statement Items (Tables)
12 Months Ended
Sep. 27, 2020
Balance Sheet Related Disclosures [Abstract]  
Accounts Receivable
Accounts Receivable (in millions)
September 27,
2020
September 29,
2019
Trade, net of allowances for doubtful accounts $ 2,687  $ 1,046 
Unbilled 1,305  1,411 
Other 11  14 
$ 4,003  $ 2,471 
Inventories
Inventories (in millions)
September 27,
2020
September 29,
2019
Raw materials $ 94  $ 77 
Work-in-process 1,155  667 
Finished goods 1,349  656 
$ 2,598  $ 1,400 
Property, Plant and Equipment
Property, Plant and Equipment (in millions)
September 27,
2020
September 29,
2019
Land $ 173  $ 170 
Buildings and improvements 1,606  1,546 
Computer equipment and software 1,427  1,356 
Machinery and equipment 5,095  4,007 
Furniture and office equipment 90  86 
Leasehold improvements 320  301 
Construction in progress 134  182 
8,845  7,648 
Less accumulated depreciation and amortization (5,134) (4,567)
$ 3,711  $ 3,081 
Goodwill
Goodwill and Other Intangible Assets. We allocate goodwill to our reporting units for impairment testing purposes. The following table presents the goodwill allocated to our reportable and nonreportable segments, as described in Note 8, as well as the changes in the carrying amounts of goodwill during fiscal 2020 and 2019 (in millions):
QCT QTL Nonreportable Segments Total
Balance at September 30, 2018 $ 5,587  $ 718  $ 193  $ 6,498 
Acquisitions 18  —  —  18 
Impairments (Note 9) —  —  (146) (146)
Other (1) (40) (1) (47) (88)
Balance at September 29, 2019 (2) 5,565  717  —  6,282 
Other (1) 40  —  41 
Balance at September 27, 2020 (2) $ 5,605  $ 718  $ —  $ 6,323 
(1)In fiscal 2020, changes in goodwill resulted from certain foreign currency translation adjustments. In fiscal 2019, changes in goodwill amounts resulted from the sale of our mobile health nonreportable segment, foreign currency translation and purchase accounting adjustments.
(2)Cumulative goodwill impairments were $812 million at both September 27, 2020 and September 29, 2019.
Intangible Assets
The components of other intangible assets, net were as follows (in millions):
September 27, 2020 September 29, 2019
Gross Carrying
Amount
Accumulated
Amortization
Weighted-average amortization period
(years)
Gross Carrying
Amount
Accumulated
Amortization
Weighted-average amortization period
(years)
Technology-based $ 5,556  $ (3,958) 11 $ 5,958  $ (3,851) 10
Other 105  (50) 9 134  (69) 9
$ 5,661  $ (4,008) 11 $ 6,092  $ (3,920) 10
Equity Method and Non-marketable Equity Investments The carrying values of our equity method and non-marketable equity investments are recorded in other noncurrent assets and were as follows (in millions):
September 27,
2020
September 29,
2019
Equity method investments $ 161  $ 343 
Non-marketable equity investments 821  787 
$ 982  $ 1,130 
Other Current Liabilities
Other Current Liabilities (in millions)
September 27,
2020
September 29,
2019
Customer incentives and other customer-related liabilities $ 1,721  $ 1,129 
Accrual for EC fines (Note 7) 1,487  1,379 
Income taxes payable 549  480 
Other 546  470 
$ 4,303  $ 3,458 
Accumulated Other Comprehensive Income
Accumulated Other Comprehensive Income. Changes in the components of accumulated other comprehensive income, net of income taxes, in stockholders’ equity during fiscal 2020 were as follows (in millions):
Foreign Currency Translation Adjustment Noncredit Other-than-Temporary Impairment Losses and Subsequent Changes in Fair Value for Certain Available-for-Sale Debt Securities Net Unrealized Gains (Losses) on Other Available-for-Sale Debt Securities Net Unrealized Gain (Loss) on Derivative Instruments Other Gains (Losses) Total Accumulated Other Comprehensive Income
Balance at September 29, 2019 $ (99) $ 23  $ 186  $ $ (18) $ 100 
Other comprehensive income before reclassifications 60  —  22  29  118 
Reclassifications from accumulated other comprehensive income —  (2) (16) —  (11)
Other comprehensive income 67  —  20  13  107 
Balance at September 27, 2020 $ (32) $ 23  $ 206  $ 21  $ (11) $ 207 
QCT Revenues Disaggregated QCT revenue streams were as follows (in millions):
2020 2019
Handsets $ 10,461  $ 9,793 
RFFE (1) 2,362  1,478 
Automotive 644  640 
IoT (2) 3,026  2,728 
Total QCT revenues $ 16,493  $ 14,639 
(1) Includes all revenues from sales of RFFE integrated circuit products (substantially all of which are used in handsets).
(2) Internet of Things (IoT) revenues primarily include products sold for use in cellular and non-cellular connected devices within the following industry segments or applications: consumer, computing, industrial, fixed wireless broadband, voice and music and wireless networking.
[1]
Share-based Compensation Expense Total share-based compensation expense, related to all of our share-based awards, was comprised as follows (in millions):
2020 2019 2018
Cost of revenues $ 34  $ 35  $ 38 
Research and development 872  725  594 
Selling, general and administrative 306  277  251 
Share-based compensation expense before income taxes 1,212  1,037  883 
Related income tax benefit (238) (184) (140)
$ 974  $ 853  $ 743 
Restructuring and Restructuring-Related Costs
Total restructuring and restructuring-related charges related to the Cost Plan were as follows (in millions):
2019 2018 (1) Total
Restructuring-related charges (2) $ 151  $ 334  $ 485 
Restructuring charges (3) 62  353  415 
$ 213  $ 687  $ 900 
(1)During fiscal 2018, we recorded restructuring and restructuring-related charges of $629 million in other expenses and charges of $58 million in investment and other income, net.
(2)Restructuring-related charges primarily related to asset impairment charges in fiscal 2019 and 2018 and also included a $52 million net gain in fiscal 2019 from the sale of certain assets related to wireless electric vehicle charging applications and the sale of our mobile health nonreportable segment, as well as a $41 million gain in fiscal 2018 resulting from fair value adjustments of certain contingent consideration related to a business combination.
(3)Restructuring charges primarily consisted of severance and consulting costs in fiscal 2019 and 2018, which were payable in cash
Investment and Other Income, net
Investment and Other Income, Net (in millions)
2020 2019 2018
Interest and dividend income $ 156  $ 300  $ 611 
Net gains on marketable securities 198  295  21 
Net gains on other investments 108  68  83 
Net gains on deferred compensation plan assets 47  34 
Impairment losses on other investments (405) (135) (75)
Net gains (losses) on derivative instruments (14) (27)
Equity in net losses of investees (21) (93) (145)
Net (losses) gains on foreign currency transactions (25) 11  37 
$ 66  $ 441  $ 539 
[1] Internet of Things (IoT) revenues primarily include products sold for use in cellular and non-cellular connected devices within the following industry segments or applications: consumer, computing, industrial, fixed wireless broadband, voice and music and wireless networking.