þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 94-1692300 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
2485 Augustine Drive Santa Clara, California | 95054 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | þ | Accelerated filer | ¨ | |||
Non-accelerated filer | ¨ | Smaller reporting company | ¨ | |||
Emerging growth company | ¨ |
Page No. | ||
Item 2 | ||
ITEM 1. | FINANCIAL STATEMENTS |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions, except per share amounts) | |||||||||||||||
Net revenue | $ | 1,653 | $ | 1,584 | $ | 5,056 | $ | 3,913 | |||||||
Cost of sales | 992 | 1,013 | 3,146 | 2,578 | |||||||||||
Gross margin | 661 | 571 | 1,910 | 1,335 | |||||||||||
Research and development | 363 | 320 | 1,063 | 876 | |||||||||||
Marketing, general and administrative | 148 | 132 | 424 | 382 | |||||||||||
Licensing gain | — | — | — | (52 | ) | ||||||||||
Operating income | 150 | 119 | 423 | 129 | |||||||||||
Interest expense | (30 | ) | (31 | ) | (92 | ) | (95 | ) | |||||||
Other expense, net | (6 | ) | (3 | ) | (4 | ) | (11 | ) | |||||||
Income before equity loss and income taxes | 114 | 85 | 327 | 23 | |||||||||||
Provision for income taxes | 12 | 22 | 26 | 30 | |||||||||||
Equity loss in investee | — | (2 | ) | (2 | ) | (7 | ) | ||||||||
Net income (loss) | $ | 102 | $ | 61 | $ | 299 | $ | (14 | ) | ||||||
Earnings (loss) per share | |||||||||||||||
Basic | $ | 0.10 | $ | 0.06 | $ | 0.31 | $ | (0.01 | ) | ||||||
Diluted | $ | 0.09 | $ | 0.06 | $ | 0.28 | $ | (0.01 | ) | ||||||
Shares used in per share calculation | |||||||||||||||
Basic | 987 | 957 | 976 | 947 | |||||||||||
Diluted | 1,076 | 1,042 | 1,058 | 947 |
(1) Prior year amounts adjusted to reflect the retrospective application of ASU 2014-09, Revenue from Contracts with Customers. Refer to Note 1. |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions) | |||||||||||||||
Net income (loss) (1) | $ | 102 | $ | 61 | $ | 299 | $ | (14 | ) | ||||||
Other comprehensive income (loss), net of tax: | |||||||||||||||
Unrealized gains (losses) on cash flow hedges: | |||||||||||||||
Unrealized gains (losses) arising during the period | (5 | ) | 5 | (16 | ) | 11 | |||||||||
Reclassification adjustment for (gains) losses realized and included in net income (loss) | 5 | (3 | ) | — | (4 | ) | |||||||||
Total change in unrealized gains (losses) on cash flow hedges | — | 2 | (16 | ) | 7 | ||||||||||
Total other comprehensive income (loss) | — | 2 | (16 | ) | 7 | ||||||||||
Cumulative-effect adjustment to accumulated deficit related to the adoption of ASU 2016-01, Financial Instruments | — | — | 2 | — | |||||||||||
Total comprehensive income (loss) | $ | 102 | $ | 63 | $ | 285 | $ | (7 | ) |
(1) Prior year amounts adjusted to reflect the retrospective application of ASU 2014-09, Revenue from Contracts with Customers. Refer to Note 1. |
September 29, 2018 | December 30, 2017 | ||||||
(In millions, except par value amounts) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 1,046 | $ | 1,185 | |||
Marketable securities | 10 | — | |||||
Accounts receivable, net | 1,207 | 454 | |||||
Inventories, net | 738 | 694 | |||||
Prepayment and receivables—related parties | 53 | 33 | |||||
Prepaid expenses | 60 | 77 | |||||
Other current assets | 200 | 191 | |||||
Total current assets | 3,314 | 2,634 | |||||
Property and equipment, net | 318 | 261 | |||||
Goodwill | 289 | 289 | |||||
Investment: equity method | 58 | 58 | |||||
Other assets | 368 | 310 | |||||
Total assets | $ | 4,347 | $ | 3,552 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Short-term debt, net | $ | 136 | $ | 70 | |||
Accounts payable | 508 | 384 | |||||
Payables to related parties | 533 | 412 | |||||
Accrued liabilities | 688 | 555 | |||||
Other current liabilities | 13 | 92 | |||||
Total current liabilities | 1,878 | 1,513 | |||||
Long-term debt, net | 1,167 | 1,325 | |||||
Other long-term liabilities | 177 | 118 | |||||
Commitments and contingencies (See Note 12) | |||||||
Stockholders’ equity: | |||||||
Capital stock: | |||||||
Common stock, par value $0.01; shares authorized: 2,250 on September 29, 2018 and 1,500 shares on December 30, 2017; shares issued: 1,007 on September 29, 2018 and 979 shares on December 30, 2017; shares outstanding: 999 on September 29, 2018 and 967 shares on December 30, 2017 | 10 | 9 | |||||
Additional paid-in capital | 8,666 | 8,464 | |||||
Treasury stock, at cost (8 shares on September 29, 2018 and 12 shares on December 30, 2017) | (67 | ) | (108 | ) | |||
Accumulated deficit | (7,474 | ) | (7,775 | ) | |||
Accumulated other comprehensive income (loss) | (10 | ) | 6 | ||||
Total stockholders’ equity | $ | 1,125 | $ | 596 | |||
Total liabilities and stockholders’ equity | $ | 4,347 | $ | 3,552 |
(1) Prior year amounts adjusted to reflect the retrospective application of ASU 2014-09, Revenue from Contracts with Customers. Refer to Note 1. |
Nine Months Ended | |||||||
September 29, 2018 | September 30, 2017 | ||||||
(In millions) | |||||||
Cash flows from operating activities: | |||||||
Net income (loss) | $ | 299 | $ | (14 | ) | ||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||
Depreciation and amortization | 127 | 105 | |||||
Provision for deferred income taxes | — | 3 | |||||
Stock-based compensation expense | 101 | 76 | |||||
Amortization of debt discount and issuance costs | 29 | 27 | |||||
Loss on debt redemption | 7 | 9 | |||||
Other | 2 | 4 | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | (753 | ) | (527 | ) | |||
Inventories | (44 | ) | 5 | ||||
Prepayment and receivables - related parties | (20 | ) | 6 | ||||
Prepaid expenses and other assets | (26 | ) | (78 | ) | |||
Payables to related parties | 121 | 61 | |||||
Accounts payable, accrued liabilities and other | 121 | 11 | |||||
Net cash used in operating activities | (36 | ) | (312 | ) | |||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | (122 | ) | (69 | ) | |||
Purchases of available-for-sale debt securities | (45 | ) | (221 | ) | |||
Proceeds from maturity of available-for-sale debt securities | 35 | 221 | |||||
Other | — | (2 | ) | ||||
Net cash used in investing activities | (132 | ) | (71 | ) | |||
Cash flows from financing activities: | |||||||
Proceeds from (repayments of) short-term borrowings, net | — | 70 | |||||
Proceeds from issuance of common stock through employee equity incentive plans | 44 | 15 | |||||
Repayments of long-term debt | (15 | ) | (70 | ) | |||
Other | (1 | ) | (14 | ) | |||
Net cash provided by financing activities | 28 | 1 | |||||
Net decrease in cash, cash equivalents, and restricted cash | (140 | ) | (382 | ) | |||
Cash, cash equivalents, and restricted cash at beginning of period | 1,191 | 1,266 | |||||
Cash, cash equivalents, and restricted cash at end of period | $ | 1,051 | $ | 884 | |||
Supplemental cash flow information: | |||||||
Non-cash investing and financing activities: | |||||||
Purchases of property and equipment, accrued but not paid | $ | 46 | $ | 53 | |||
Issuance of treasury stock to partially settle debt | $ | 103 | $ | 38 | |||
Non-cash additions of property, plant and equipment | $ | 9 | $ | 8 | |||
Reconciliation of cash, cash equivalents, and restricted cash | |||||||
Cash and cash equivalents | $ | 1,046 | $ | 879 | |||
Restricted cash included in Other current assets | 5 | 2 | |||||
Restricted cash included in Other assets | — | 3 | |||||
Total cash, cash equivalents, and restricted cash | $ | 1,051 | $ | 884 |
(1) Prior year amounts adjusted to reflect the retrospective application of ASU 2014-09, Revenue from Contracts with Customers. Refer to Note 1. |
(2) Amounts reflected adoption of ASU 2016-18, Statement of Cash Flows, Restricted Cash (Topic 230) beginning in the first quarter of 2018. |
Three months ended September 29, 2017 | Nine months ended September 29, 2017 | ||||||||||||||||||||||
As Previously Reported | Adjustment | As Adjusted | As Previously Reported | Adjustment | As Adjusted | ||||||||||||||||||
(In millions, except per share amounts) | |||||||||||||||||||||||
Net revenue | $ | 1,643 | $ | (59 | ) | $ | 1,584 | $ | 3,849 | $ | 64 | $ | 3,913 | ||||||||||
Cost of sales | 1,070 | (57 | ) | 1,013 | 2,541 | 37 | 2,578 | ||||||||||||||||
Gross margin | 573 | (2 | ) | 571 | 1,308 | 27 | 1,335 | ||||||||||||||||
Research and development | 315 | 5 | 320 | 860 | 16 | 876 | |||||||||||||||||
Marketing, general and administrative | 132 | — | 132 | 378 | 4 | 382 | |||||||||||||||||
Licensing gain | — | — | — | (52 | ) | — | (52 | ) | |||||||||||||||
Operating income (loss) | 126 | (7 | ) | 119 | 122 | 7 | 129 | ||||||||||||||||
Interest expense | (31 | ) | — | (31 | ) | (95 | ) | — | (95 | ) | |||||||||||||
Other expense, net | (3 | ) | — | (3 | ) | (11 | ) | — | (11 | ) | |||||||||||||
Income (loss) before equity loss and income taxes | 92 | (7 | ) | 85 | 16 | 7 | 23 | ||||||||||||||||
Provision for income taxes | 19 | 3 | 22 | 27 | 3 | 30 | |||||||||||||||||
Equity loss in investee | (2 | ) | — | (2 | ) | (7 | ) | — | (7 | ) | |||||||||||||
Net income (loss) | $ | 71 | $ | (10 | ) | $ | 61 | $ | (18 | ) | $ | 4 | $ | (14 | ) | ||||||||
Earnings (loss) per share | |||||||||||||||||||||||
Basic | $ | 0.07 | $ | (0.01 | ) | $ | 0.06 | $ | (0.02 | ) | $ | 0.01 | $ | (0.01 | ) | ||||||||
Diluted | $ | 0.07 | $ | (0.01 | ) | $ | 0.06 | $ | (0.02 | ) | $ | 0.01 | $ | (0.01 | ) | ||||||||
Shares used in per share calculation | |||||||||||||||||||||||
Basic | 957 | 957 | 947 | 947 | |||||||||||||||||||
Diluted | 1,042 | 1,042 | 947 | 947 |
December 30, 2017 | |||||||||||
As Previously Reported | Adjustment | As Adjusted | |||||||||
(In millions, except per share amounts) | |||||||||||
Accounts receivable, net | $ | 400 | $ | 54 | $ | 454 | |||||
Inventories, net | 739 | (45 | ) | 694 | |||||||
Other current assets | 188 | 3 | 191 | ||||||||
Accrued liabilities | 541 | 14 | 555 | ||||||||
Other current liabilities | 57 | 35 | 92 | ||||||||
Deferred income on shipments to distributors | 22 | (22 | ) | — | |||||||
Accumulated deficit | (7,760 | ) | (15 | ) | (7,775 | ) |
September 29, 2018 | December 30, 2017 | ||||||
(In millions) | |||||||
Raw materials | $ | 85 | $ | 34 | |||
Work in process | 418 | 446 | |||||
Finished goods | 235 | 214 | |||||
Total inventories, net | $ | 738 | $ | 694 |
September 29, 2018 | December 30, 2017 | ||||||
(In millions) | |||||||
Leasehold improvements | $ | 176 | $ | 187 | |||
Equipment | 780 | 758 | |||||
Construction in progress | 80 | 56 | |||||
Property and equipment, gross | 1,036 | 1,001 | |||||
Accumulated depreciation | (718 | ) | (740 | ) | |||
Total property and equipment, net | $ | 318 | $ | 261 |
September 29, 2018 | December 30, 2017 | ||||||
(In millions) | |||||||
Software technology and licenses, net | $ | 274 | $ | 239 | |||
Other | 94 | 71 | |||||
Total other assets | $ | 368 | $ | 310 |
September 29, 2018 | December 30, 2017 | ||||||
(In millions) | |||||||
Accrued compensation and benefits | $ | 223 | $ | 206 | |||
Marketing programs and advertising expenses | 249 | 145 | |||||
Software technology and licenses payable | 45 | 41 | |||||
Other | 171 | 163 | |||||
Total accrued liabilities | $ | 688 | $ | 555 |
September 29, 2018 | December 30, 2017 | ||||||
(In millions) | |||||||
Unearned revenue | $ | 3 | $ | 85 | |||
Other | 10 | 7 | |||||
Total other current liabilities | $ | 13 | $ | 92 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions) | |||||||||||||||
Beginning balance | $ | 67 | $ | 43 | $ | 85 | $ | 22 | |||||||
Unearned revenue | 37 | 32 | 124 | 59 | |||||||||||
Revenue recognized during the period | (86 | ) | — | (186 | ) | (6 | ) | ||||||||
Other | (15 | ) | — | (20 | ) | — | |||||||||
Ending balance | $ | 3 | $ | 75 | $ | 3 | $ | 75 |
September 29, 2018 | December 30, 2017 | ||||||
(In millions) | |||||||
Principal amounts: | |||||||
Principal | $ | 805 | $ | 805 | |||
Unamortized debt discount(1) | (268 | ) | (286 | ) | |||
Unamortized debt issuance costs | (11 | ) | (12 | ) | |||
Net carrying amount | $ | 526 | $ | 507 | |||
Carrying amount of the equity component, net(2) | $ | 305 | $ | 305 |
(1) | Included in the consolidated balance sheets within Long-term debt, net and amortized over the remaining life of the notes using the effective interest rate method. |
(2) | Included in the consolidated balance sheets within additional paid-in capital, net of $9 million of equity issuance costs. |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions) | |||||||||||||||
Contractual interest expense | $ | 5 | $ | 4 | $ | 13 | $ | 13 | |||||||
Interest cost related to amortization of debt issuance costs | — | — | 1 | 1 | |||||||||||
Interest cost related to amortization of the debt discount | $ | 6 | $ | 6 | $ | 18 | $ | 17 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions, except per share amounts) | |||||||||||||||
Numerator – Net income (loss): | |||||||||||||||
Numerator for basic earnings (loss) per share | $ | 102 | $ | 61 | $ | 299 | $ | (14 | ) | ||||||
Denominator - Weighted average shares: | |||||||||||||||
Denominator for basic earnings (loss) per share | 987 | 957 | 976 | 947 | |||||||||||
Effect of potentially dilutive shares: | |||||||||||||||
Employee stock options and restricted stock units | 34 | 44 | 35 | — | |||||||||||
Warrants | 55 | 41 | 47 | — | |||||||||||
Denominator for diluted earnings (loss) per share | 1,076 | 1,042 | 1,058 | 947 | |||||||||||
Earnings (loss) per share: | |||||||||||||||
Basic | $ | 0.10 | $ | 0.06 | $ | 0.31 | $ | (0.01 | ) | ||||||
Diluted | $ | 0.09 | $ | 0.06 | $ | 0.28 | $ | (0.01 | ) |
Total Fair Value | Cash and Cash Equivalents | Short-Term Marketable Securities | |||||||||
(In millions) | |||||||||||
September 29, 2018 | |||||||||||
Cash | $ | 92 | $ | 92 | $ | — | |||||
Level 1(1) (2) | |||||||||||
Government money market funds | $ | 205 | $ | 205 | $ | — | |||||
Total level 1 | $ | 205 | $ | 205 | $ | — | |||||
Level 2(1) (3) | |||||||||||
Commercial paper | $ | 759 | $ | 749 | $ | 10 | |||||
Total level 2 | $ | 759 | $ | 749 | $ | 10 | |||||
Total | $ | 1,056 | $ | 1,046 | $ | 10 |
Total Fair Value | Cash and Cash Equivalents | ||||||
(In millions) | |||||||
December 30, 2017 | |||||||
Cash | $ | 108 | $ | 108 | |||
Level 1(1) (2) | |||||||
Government money market funds | $ | 395 | $ | 395 | |||
Total level 1 | $ | 395 | $ | 395 | |||
Level 2(1) (3) | |||||||
Commercial paper | $ | 682 | $ | 682 | |||
Total level 2 | $ | 682 | $ | 682 | |||
Total | $ | 1,185 | $ | 1,185 |
(1) | The Company did not have any transfers between Level 1 and Level 2 of the fair value hierarchy during the three and nine months ended September 29, 2018 or the year ended December 30, 2017. |
(2) | The Company’s Level 1 assets are valued using quoted prices for identical instruments in active markets. |
(3) | The Company’s Level 2 assets are valued using broker reports that utilize quoted prices for identical instruments in markets that are not active or comparable instruments in active markets. Brokers gather observable inputs for all of the Company’s fixed income securities from a variety of industry data providers and other third-party sources. |
September 29, 2018 | December 30, 2017 | ||||||||||||||
Carrying Amount | Estimated Fair Value | Carrying Amount | Estimated Fair Value | ||||||||||||
(In millions) | |||||||||||||||
Short-term debt | $ | 136 | $ | 137 | $ | 70 | $ | 70 | |||||||
Long-term debt, net(1) | $ | 1,167 | $ | 3,830 | $ | 1,324 | $ | 2,103 |
(1) | Carrying amounts of long-term debt are net of unamortized debt issuance costs of $17 million as of September 29, 2018 and $19 million as of December 30, 2017, and net of unamortized debt discount associated with the 2.125% Notes of $268 million as of September 29, 2018 and $286 million as of December 30, 2017. |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions) | |||||||||||||||
Foreign Currency Forward Contracts - gains (losses) | |||||||||||||||
Contracts designated as cash flow hedging instruments | |||||||||||||||
Other comprehensive income (loss) | $ | — | $ | 1 | $ | (16 | ) | $ | 8 | ||||||
Research and development | (4 | ) | 3 | — | 4 | ||||||||||
Marketing, general and administrative | (1 | ) | 1 | — | 1 | ||||||||||
Contracts not designated as hedging instruments | |||||||||||||||
Other income (expense), net | $ | — | $ | (2 | ) | $ | (2 | ) | $ | (3 | ) |
September 29, 2018 | December 30, 2017 | ||||||
(In millions) | |||||||
Foreign Currency Forward Contracts - gains (losses) | |||||||
Contracts designated as cash flow hedging instruments | $ | (10 | ) | $ | 7 |
• | the Computing and Graphics segment, which primarily includes desktop and notebook processors and chipsets, discrete and integrated graphics processing units (GPUs), professional GPUs. The Company also licenses portions of its IP portfolio; and |
• | the Enterprise, Embedded and Semi-Custom segment, which primarily includes server and embedded processors, semi-custom System-on-Chip (SoC) products, development services and technology for game consoles. The Company also licenses portions of its IP portfolio. |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions) | |||||||||||||||
Net revenue: | |||||||||||||||
Computing and Graphics | $ | 938 | $ | 835 | $ | 3,139 | $ | 2,069 | |||||||
Enterprise, Embedded and Semi-Custom | 715 | 749 | 1,917 | 1,844 | |||||||||||
Total net revenue | $ | 1,653 | $ | 1,584 | $ | 5,056 | $ | 3,913 | |||||||
Operating income (loss): | |||||||||||||||
Computing and Graphics | $ | 100 | $ | 73 | $ | 355 | $ | 59 | |||||||
Enterprise, Embedded and Semi-Custom | 86 | 74 | 169 | 145 | |||||||||||
All Other (1) | (36 | ) | (28 | ) | (101 | ) | (75 | ) | |||||||
Total operating income | $ | 150 | $ | 119 | $ | 423 | $ | 129 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | ||||||||||||
(In millions) | |||||||||||||||
Beginning balance | $ | 12 | $ | 10 | $ | 12 | $ | 12 | |||||||
New warranties issued | 7 | 7 | 20 | 18 | |||||||||||
Settlements | (7 | ) | (7 | ) | (21 | ) | (16 | ) | |||||||
Changes in liability for pre-existing warranties, including expirations | — | 1 | 1 | (3 | ) | ||||||||||
Ending balance | $ | 12 | $ | 11 | $ | 12 | $ | 11 |
Three Months Ended | |||||||||||||||||||||||
September 29, 2018 | September 30, 2017 | ||||||||||||||||||||||
Unrealized gains (losses) on available-for-sale securities | Unrealized gains (losses) on cash flow hedges | Total | Unrealized gains (losses) on available-for-sale securities | Unrealized gains (losses) on cash flow hedges | Total | ||||||||||||||||||
(In millions) | |||||||||||||||||||||||
Beginning balance | $ | — | $ | (10 | ) | $ | (10 | ) | $ | (1 | ) | $ | 1 | $ | — | ||||||||
Unrealized gains (losses) arising during the period | — | (5 | ) | (5 | ) | — | 6 | 6 | |||||||||||||||
Reclassification adjustment for (gains) losses realized and included in net income (loss) | — | 5 | 5 | — | (4 | ) | (4 | ) | |||||||||||||||
Tax effect | — | — | — | — | — | — | |||||||||||||||||
Total other comprehensive income (loss) | — | — | — | — | 2 | 2 | |||||||||||||||||
Ending balance | $ | — | $ | (10 | ) | $ | (10 | ) | $ | (1 | ) | $ | 3 | $ | 2 |
Nine Months Ended | |||||||||||||||||||||||
September 29, 2018 | September 30, 2017 | ||||||||||||||||||||||
Unrealized gains (losses) on available-for-sale securities | Unrealized gains (losses) on cash flow hedges | Total | Unrealized gains (losses) on available-for-sale securities | Unrealized gains (losses) on cash flow hedges | Total | ||||||||||||||||||
(In millions) | |||||||||||||||||||||||
Beginning balance | $ | — | $ | 6 | $ | 6 | $ | (1 | ) | $ | (4 | ) | $ | (5 | ) | ||||||||
Unrealized gains (losses) arising during the period | — | (16 | ) | (16 | ) | — | 14 | 14 | |||||||||||||||
Reclassification adjustment for gains realized and included in net income (loss) | — | — | — | — | (5 | ) | (5 | ) | |||||||||||||||
Tax effect | — | — | — | — | (2 | ) | (2 | ) | |||||||||||||||
Total other comprehensive income (loss) | — | (16 | ) | (16 | ) | — | 7 | 7 | |||||||||||||||
Ending balance | $ | — | $ | (10 | ) | $ | (10 | ) | $ | (1 | ) | $ | 3 | $ | 2 |
ITEM 2. | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
• | x86 microprocessors, as standalone devices or as incorporated into an accelerated processing unit (APU), chipsets, discrete and integrated graphics processing units (GPUs), and professional GPUs; and |
• | server and embedded processors, semi-custom System-on-Chip (SoC) products and technology for game consoles. |
• | the Computing and Graphics segment, which primarily includes desktop and notebook processors and chipsets, GPUs and professional GPUs. We also license portions of our IP portfolio; and |
• | the Enterprise, Embedded and Semi-Custom segment, which primarily includes server and embedded processors, semi-custom SoC products, development services and technology for game consoles. We also license portions of our IP portfolio. |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | |||||||||||||
(In millions) | ||||||||||||||||
Net revenue: | ||||||||||||||||
Computing and Graphics | $ | 938 | $ | 835 | $ | 3,139 | $ | 2,069 | ||||||||
Enterprise, Embedded and Semi-Custom | 715 | 749 | 1,917 | 1,844 | ||||||||||||
Total net revenue | $ | 1,653 | $ | 1,584 | $ | 5,056 | $ | 3,913 | ||||||||
Operating income (loss): | ||||||||||||||||
Computing and Graphics | $ | 100 | $ | 73 | $ | 355 | $ | 59 | ||||||||
Enterprise, Embedded and Semi-Custom | 86 | 74 | 169 | 145 | ||||||||||||
All Other | (36 | ) | (28 | ) | (101 | ) | (75 | ) | ||||||||
Total operating income | $ | 150 | $ | 119 | $ | 423 | $ | 129 |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 29, 2018 | September 30, 2017 | September 29, 2018 | September 30, 2017 | |||||||||||||
(In millions except for percentages) | ||||||||||||||||
Cost of sales | $ | 992 | $ | 1,013 | $ | 3,146 | $ | 2,578 | ||||||||
Gross margin | 661 | 571 | 1,910 | 1,335 | ||||||||||||
Gross margin percentage | 40 | % | 36 | % | 38 | % | 34 | % | ||||||||
Research and development | 363 | 320 | 1,063 | 876 | ||||||||||||
Marketing, general and administrative | 148 | 132 | 424 | 382 | ||||||||||||
Licensing gain | — | — | — | (52 | ) | |||||||||||
Interest expense | (30 | ) | (31 | ) | (92 | ) | (95 | ) | ||||||||
Other expense, net | (6 | ) | (3 | ) | (4 | ) | (11 | ) | ||||||||
Provision for income taxes | 12 | 22 | 26 | 30 | ||||||||||||
Equity loss in investee | $ | — | $ | (2 | ) | $ | (2 | ) | $ | (7 | ) |
Nine Months Ended | ||||||||
September 29, 2018 | September 30, 2017 | |||||||
(In millions ) | ||||||||
Net cash provided by (used in): | ||||||||
Operating activities | $ | (36 | ) | $ | (312 | ) | ||
Investing activities | (132 | ) | (71 | ) | ||||
Financing activities | 28 | 1 |
Payments due by period as of September 29, 2018 | |||||||||||||||||||||||||||
(In millions) | Total | Remainder of 2018 | 2019 | 2020 | 2021 | 2022 | 2023 and thereafter | ||||||||||||||||||||
6.75% Notes | $ | 66 | $ | — | $ | 66 | $ | — | $ | — | $ | — | $ | — | |||||||||||||
7.50% Notes | 337 | — | — | — | — | 337 | — | ||||||||||||||||||||
7.00% Notes | 310 | — | — | — | — | — | 310 | ||||||||||||||||||||
2.125% Notes | 805 | — | — | — | — | — | 805 | ||||||||||||||||||||
Secured Revolving Line of Credit | 70 | 70 | — | — | — | — | — | ||||||||||||||||||||
Other long-term liabilities (1) | 164 | 8 | 47 | 42 | 34 | 30 | 3 | ||||||||||||||||||||
Aggregate interest obligation (2) | 409 | 35 | 68 | 65 | 65 | 64 | 112 | ||||||||||||||||||||
Operating leases | 337 | 14 | 54 | 48 | 43 | 40 | 138 | ||||||||||||||||||||
Purchase obligations (3) | 190 | 91 | 59 | 25 | 12 | 3 | — | ||||||||||||||||||||
Obligations to GF (4) | 2,452 | 571 | 1,101 | 780 | — | — | — | ||||||||||||||||||||
Total contractual obligations (5) | $ | 5,140 | $ | 789 | $ | 1,395 | $ | 960 | $ | 154 | $ | 474 | $ | 1,368 |
(1) | Amounts largely represent future fixed and non-cancellable cash payments associated with software technology and licenses and IP licenses, including the payments due within the next 12 months. |
(2) | Represents estimated aggregate interest obligations for our outstanding debt obligations that are payable in cash, excluding non-cash amortization of debt issuance costs and debt discount. |
(3) | We have purchase obligations for goods and services where payments are based, in part, on the volume or type of services we acquire. In those cases, we only included the minimum volume of purchase obligations in the table above. Purchase orders for goods and services that are cancellable upon notice and without significant penalties are not included in the amounts above. |
(4) | Includes our currently expected purchases from GF for the remainder of 2018 for wafer manufacturing and research and development activities and minimum purchase obligations for wafer purchases for years 2018 through 2020. We cannot meaningfully quantify or estimate our future purchase obligations to GF beyond 2020 but expect that our future purchases from GF will continue to be material. On August 27, 2018, GF announced that it was putting its 7nm FinFET program on hold indefinitely. We are presently focusing the breadth of our 7nm product portfolio on Taiwan Semiconductor Co., Ltd.’s (TSMC) 7nm process. We are currently in discussion with GF to modify the WSA to align with GF’s new business strategy. |
(5) | Total amount excludes contractual obligations already recorded on our condensed consolidated balance sheets except for debt obligations and other liabilities related to software and technology licenses and IP licenses. |
ITEM 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 4. | CONTROLS AND PROCEDURES |
ITEM 1. | LEGAL PROCEEDINGS |
ITEM 1A. | RISK FACTORS |
• | business practices, including rebating and allocation strategies and pricing actions, designed to limit our market share and margins; |
• | de facto control over industry standards, and heavy influence on PC manufacturers and other PC industry participants, including motherboard, memory, chipset and basic input/output system (BIOS), suppliers and software companies as well as the graphics interface for Intel platforms; and |
• | marketing and advertising expenditures in support of positioning the Intel brand over the brand of its original equipment manufacturer OEM customers and retailers. |
• | make it difficult for us to satisfy our financial obligations, including making scheduled principal and interest payments; |
• | limit our ability to borrow additional funds for working capital, capital expenditures, acquisitions and general corporate and other purposes; |
• | limit our ability to use our cash flow or obtain additional financing for future working capital, capital expenditures, acquisitions or other general corporate purposes; |
• | create or permit restrictions on the ability of certain restricted subsidiaries to pay dividends or make other distributions to us; |
• | create liens upon any of the Loan Parties’ property (other than customary permitted liens and liens in respect of up to $1.5 billion of secured credit facilities debt, which amount includes our Secured Revolving Line of Credit); |
• | make certain loans, make payments with respect to subordinated debt or certain borrowed money prior to its due date; and |
• | a failure to accurately estimate customer demand for our products, including for our older products as our new products are introduced; or |
ITEM 2. | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
ITEM 6. | EXHIBITS |
*10.1 | ||
31.1 | ||
31.2 | ||
32.1 | ||
32.2 | ||
101.INS | XBRL Instance Document. | |
101.SCH | XBRL Taxonomy Extension Schema Document. | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. | |
101.LAB | XBRL Taxonomy Extension Label Linkbase Document. | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document. |
* Management contracts and compensatory plans or arrangements. |
ADVANCED MICRO DEVICES, INC. | |||
October 31, 2018 | By: | /s/Devinder Kumar | |
Name: | Devinder Kumar | ||
Title: | Senior Vice President, Chief Financial Officer and Treasurer Signing on behalf of the Registrant as the Principal Financial Officer |
1. | Purposes of the Plan |
2. | Definitions and Construction |
(i) | Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company (not including the securities beneficially owned by such |
(ii) | During any period of two consecutive years, individuals who at the beginning of such period constituted the Board and any new director (other than a director designated by a person who has entered into an agreement or arrangement with the Company to effect a transaction described in clause (i) or (ii) of this sentence) whose appointment, election, or nomination for election by the Company’s stockholders, was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose appointment, election or nomination for election was previously so approved, cease for any reason to constitute a majority of the Board; |
(iii) | There is consummated a merger or consolidation of the Company or Subsidiary with or into any other corporation, other than a merger or consolidation which would result in the holders of the voting securities of the Company outstanding immediately prior thereto holding securities which represent immediately after such merger or consolidation more than 50% of the combined voting power of the voting securities of either the Company or the other entity which survives such merger or consolidation or the parent of the entity which survives such merger or consolidation; or |
(iv) | The stockholders of the Company approve a plan of complete liquidation of the Company and such plan of complete liquidation of the Company is consummated or there is consummated the sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 80% of the combined voting power of the voting securities of which are owned by persons in substantially the same proportions as their ownership of the Company immediately prior to such sale. |
3. | Shares Subject to the Plan |
4. | Offering Periods; Offering Documents; Purchase Dates |
(i) | the length of the Offering Period, which period will not exceed twenty-seven (27) months; |
(ii) | the maximum number of Shares that may be purchased by any Eligible Employee during such Offering Period, to be determined by the Administrator as set forth in Section 5(e); and |
(iii) | such other provisions as the Administrator determines are appropriate, subject to the Plan. |
5. | Eligibility and Participation |
(i) | Except as otherwise set forth in an Offering Document or determined by the Administrator, an Eligible Employee may become a Participant in the Plan for an Offering Period by delivering a subscription agreement to the Company by such time prior to the Enrollment Date for such Offering Period (or such other date specified in the Offering Document) designated by the Administrator and in such form as the Company provides. |
(ii) | Each subscription agreement will designate a whole percentage of such Eligible Employee’s Compensation to be withheld by the Company or the Designated Subsidiary employing such Eligible Employee on each payday during the Offering Period as payroll deductions under the Plan. The percentage of Compensation designated by an Eligible Employee as payroll deductions may not be less than one percent (1%) and may not be more than twenty five percent (25%), or such lower limit as may be set by the Administrator for the Offering Period. The payroll deductions made for each Participant will be credited to an account for such Participant under the Plan and will be deposited with the general funds of the Company, unless required otherwise under Applicable Law. |
(iii) | A Participant may decrease (but not increase) the percentage of Compensation designated in his or her subscription agreement, subject to the limits of this Section 5(b), or may suspend his or her payroll deductions, at any time during an Offering Period; provided, however, that the Administrator may limit the number of changes a Participant may make to his or her payroll deduction elections during each Offering Period in the applicable Offering Document (and in the absence of any specific designation by the Administrator, a Participant will be allowed one (1) decrease to or suspension of his or her payroll deduction elections during each Offering Period). |
(i) | A maximum number of Shares that may be purchased by any Participant on any Purchase Date during such Offering Period, which, in the absence of a lower specification by the Administrator, will be fifteen thousand (15,000) Shares; and |
(ii) | A maximum aggregate number of Shares that may be purchased by all Participants on any Purchase Date during an Offering Period, which, in the absence of a lower specification by the Administrator, will be ten million (10,000,000) Shares. |
6. | Grant and Exercise of Rights |
(i) | The admission of such Shares to listing on all stock exchanges, if any, on which the Common Stock is then listed; |
(ii) | The completion of any registration or other qualification of such Shares under any state or federal law or under the rulings or regulations of the Securities and Exchange Commission or any other governmental regulatory body, that the Administrator will, in its absolute discretion, deem necessary or advisable; |
(iii) | The obtaining of any approval or other clearance from any state or federal governmental agency that the Administrator will, in its absolute discretion, determine to be necessary or advisable; |
(iv) | The payment to the Company or a Designated Subsidiary of all amounts that the Company or the Designated Subsidiary is required to withhold under federal, state or local law as a result of the Participant's participation in the Plan; and |
(v) | The lapse of such reasonable period of time following the exercise of the rights as the Administrator may from time to time establish for reasons of administrative convenience. |
7. | Withdrawal; Cessation of Eligibility |
8. | Adjustments Upon Changes in Stock |
9. | Amendment, Modification and Termination |
10. | Term of Plan |
11. | Administration |
12. | Miscellaneous |
(i) | A Participant may, if permitted by the Administrator, file a written designation of a beneficiary who is to receive any Shares and/or cash, if any, from the Participant’s account under the Plan in the event of such Participant’s death subsequent to a Purchase Date on which the Participant’s rights are exercised but prior to delivery to such Participant of such Shares and cash. In addition, if permitted by the Administrator, a Participant may file a written designation of a beneficiary who is to receive any cash from the Participant’s account under the Plan in the event of such Participant’s death prior to exercise of the Participant’s rights under the Plan. If the Participant is married and resides in a community property state, a designation of a person other than the |
(ii) | Such designation of beneficiary may be changed by the Participant at any time by written notice to the Company. In the event of the death of a Participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such Participant’s death, the Company will deliver such Shares and/or cash to the executor or administrator of the estate of the Participant, or if no such executor or administrator is appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such Shares and/or cash to the spouse or to any one or more dependents or relatives of the Participant, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate. |
Date: October 31, 2018 | ||
/s/Lisa T. Su | ||
Lisa T. Su President and Chief Executive Officer (Principal Executive Officer) | ||
Date: October 31, 2018 | ||
/s/Devinder Kumar | ||
Devinder Kumar Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer) | ||
(i.) | the Quarterly Report on Form 10-Q of the Company for the period ended September 29, 2018 (the "Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and |
(ii.) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: October 31, 2018 | ||
/s/Lisa T. Su | ||
Lisa T. Su President and Chief Executive Officer (Principal Executive Officer) | ||
(i.) | the Quarterly Report on Form 10-Q of the Company for the period ended September 29, 2018 (the "Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and |
(ii.) | the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
Date: October 31, 2018 | ||
/s/ Devinder Kumar | ||
Devinder Kumar Senior Vice President, Chief Financial Officer and Treasurer (Principal Financial Officer) | ||
Document and Entity Information - shares |
9 Months Ended | |
---|---|---|
Sep. 29, 2018 |
Oct. 26, 2018 |
|
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 29, 2018 | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | AMD | |
Entity Registrant Name | ADVANCED MICRO DEVICES INC | |
Entity Central Index Key | 0000002488 | |
Current Fiscal Year End Date | --12-29 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Entity Common Stock, Shares Outstanding | 999,407,216 |
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
||||||||||||
Income Statement [Abstract] | |||||||||||||||
Net revenue | [1] | $ 1,653 | $ 1,584 | $ 5,056 | $ 3,913 | ||||||||||
Cost of sales | [1] | 992 | 1,013 | 3,146 | 2,578 | ||||||||||
Gross margin | [1] | 661 | 571 | 1,910 | 1,335 | ||||||||||
Research and development | [1] | 363 | 320 | 1,063 | 876 | ||||||||||
Marketing, general and administrative | [1] | 148 | 132 | 424 | 382 | ||||||||||
Licensing gain | [1] | 0 | 0 | 0 | (52) | ||||||||||
Operating income | [1] | 150 | 119 | 423 | 129 | ||||||||||
Interest expense | [1] | (30) | (31) | (92) | (95) | ||||||||||
Other income (expense), net | [1] | (6) | (3) | (4) | (11) | ||||||||||
Income before equity loss and income taxes | [1] | 114 | 85 | 327 | 23 | ||||||||||
Provision for income taxes | [1] | 12 | 22 | 26 | 30 | ||||||||||
Equity loss in investee | [1] | 0 | (2) | (2) | (7) | ||||||||||
Net income (loss) | [1],[2] | $ 102 | $ 61 | $ 299 | [3],[4] | $ (14) | [3],[4] | ||||||||
Earnings (loss) per share | |||||||||||||||
Basic (in usd per share) | [1] | $ 0.10 | $ 0.06 | $ 0.31 | $ (0.01) | ||||||||||
Diluted (in usd per share) | [1] | $ 0.09 | $ 0.06 | $ 0.28 | $ (0.01) | ||||||||||
Shares used in per share calculation | |||||||||||||||
Basic (in shares) | [1] | 987 | 957 | 976 | 947 | ||||||||||
Diluted (in shares) | [1] | 1,076 | 1,042 | 1,058 | 947 | ||||||||||
|
Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
||||||||||||
Statement of Comprehensive Income [Abstract] | |||||||||||||||
Net income (loss) | [1],[2] | $ 102 | $ 61 | $ 299 | [3],[4] | $ (14) | [3],[4] | ||||||||
Unrealized gains (losses) on cash flow hedges: | |||||||||||||||
Unrealized gains (losses) arising during the period | [2] | (5) | 5 | (16) | 11 | ||||||||||
Reclassification adjustment for (gains) losses realized and included in net income (loss) | [2] | 5 | (3) | 0 | (4) | ||||||||||
Total change in unrealized gains (losses) on cash flow hedges | [2] | 0 | 2 | (16) | 7 | ||||||||||
Total other comprehensive income (loss) | [2] | 0 | 2 | (16) | 7 | ||||||||||
Cumulative-effect adjustment to accumulated deficit related to the adoption of ASU 2016-01, Financial Instruments | [2] | 0 | 0 | 2 | 0 | ||||||||||
Total comprehensive income (loss) | [2] | $ 102 | $ 63 | $ 285 | $ (7) | ||||||||||
|
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares |
Sep. 29, 2018 |
Dec. 30, 2017 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 2,250,000,000 | 1,500,000,000 |
Common stock, shares issued (in shares) | 1,007,000,000 | 979,000,000 |
Common stock, shares outstanding (in shares) | 999,000,000 | 967,000,000 |
Treasury stock, shares (in shares) | 8,000,000 | 12,000,000 |
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions |
9 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
|||||||||||||
Cash flows from operating activities: | ||||||||||||||
Net income (loss) | [1],[2],[3],[4] | $ 299 | $ (14) | |||||||||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ||||||||||||||
Depreciation and amortization | [1],[4] | 127 | 105 | |||||||||||
Provision for deferred income taxes | [1],[4] | 0 | 3 | |||||||||||
Stock-based compensation expense | [1],[4] | 101 | 76 | |||||||||||
Amortization of debt discount and issuance costs | [1],[4] | 29 | 27 | |||||||||||
Loss on debt redemption | [1],[4] | 7 | 9 | |||||||||||
Other | [1],[4] | 2 | 4 | |||||||||||
Changes in operating assets and liabilities: | ||||||||||||||
Accounts receivable | [1],[4] | (753) | (527) | |||||||||||
Inventories | [1],[4] | (44) | 5 | |||||||||||
Prepayment and receivables - related parties | [1],[4] | (20) | 6 | |||||||||||
Prepaid expenses and other assets | [1],[4] | (26) | (78) | |||||||||||
Payables to related parties | [1],[4] | 121 | 61 | |||||||||||
Accounts payable, accrued liabilities and other | [1],[4] | 121 | 11 | |||||||||||
Net cash used in operating activities | [1],[4] | (36) | (312) | |||||||||||
Cash flows from investing activities: | ||||||||||||||
Purchases of property and equipment | [1],[4] | (122) | (69) | |||||||||||
Purchases of available-for-sale debt securities | [1],[4] | (45) | (221) | |||||||||||
Proceeds from maturity of available-for-sale debt securities | [1],[4] | 35 | 221 | |||||||||||
Other | [1],[4] | 0 | (2) | |||||||||||
Net cash used in investing activities | [1],[4] | (132) | (71) | |||||||||||
Cash flows from financing activities: | ||||||||||||||
Proceeds from (repayments of) short-term borrowings, net | [1],[4] | 0 | 70 | |||||||||||
Proceeds from issuance of common stock through employee equity incentive plans | [1],[4] | 44 | 15 | |||||||||||
Repayments of long-term debt | [1],[4] | (15) | (70) | |||||||||||
Other | [1],[4] | (1) | (14) | |||||||||||
Net cash provided by financing activities | [1],[4] | 28 | 1 | |||||||||||
Net decrease in cash, cash equivalents, and restricted cash | [1],[4] | (140) | (382) | |||||||||||
Cash, cash equivalents, and restricted cash at beginning of period | [1],[4] | 1,191 | 1,266 | |||||||||||
Cash, cash equivalents, and restricted cash at end of period | [1],[4] | 1,051 | 884 | |||||||||||
Non-cash investing and financing activities: | ||||||||||||||
Purchases of property and equipment, accrued but not paid | [1],[4] | 46 | 53 | |||||||||||
Issuance of treasury stock to partially settle debt | [1],[4] | 103 | 38 | |||||||||||
Non-cash additions of property, plant and equipment | [1],[4] | 9 | 8 | |||||||||||
Reconciliation of cash, cash equivalents, and restricted cash | ||||||||||||||
Cash and cash equivalents | [1],[4] | 1,046 | [5] | 879 | ||||||||||
Restricted cash included in Other current assets | [1],[4] | 5 | 2 | |||||||||||
Restricted cash included in Other assets | [1],[4] | 0 | 3 | |||||||||||
Total cash, cash equivalents, and restricted cash | [1],[4] | $ 1,191 | $ 1,266 | |||||||||||
|
Basis of Presentation and Significant Accounting Policies |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation and Significant Accounting Policies | Basis of Presentation and Significant Accounting Policies Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of Advanced Micro Devices, Inc. and its subsidiaries (the Company or AMD) 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. The results of operations for the three and nine months ended September 29, 2018 shown in this report are not necessarily indicative of results to be expected for the full year ending December 29, 2018. In the opinion of the Company’s management, the information contained herein reflects all adjustments necessary for a fair presentation of the Company’s results of operations, financial position and cash flows. All such adjustments are of a normal, recurring nature. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 30, 2017. The Company uses a 52 or 53 week fiscal year ending on the last Saturday in December. The three and nine months ended September 29, 2018 and September 30, 2017 each consisted of 13 weeks and 39 weeks, respectively. Principles of Consolidation. The condensed consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiaries. Upon consolidation, all significant inter-company accounts and transactions are eliminated. Revenue Recognition. Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. Sales, value-added, and other taxes collected concurrently with the provision of goods or services are excluded from revenue. Shipping and handling costs associated with product sales are included in cost of sales. Nature of products and services The Company's microprocessors, chipsets, graphic processor units (GPUs), professional graphics products, server and embedded processors, and System-on-Chip (SoC) products may be sold as standard non-custom products, or custom products manufactured to customers’ specifications. Non-custom products: The Company transfers control and recognizes revenue when non-custom products are shipped to customers, which includes original equipment manufacturers (OEM) and distributors, in accordance with the shipping terms of the sale. Certain OEMs may be entitled to rights of return and rebates under OEM agreements. The Company also sells to distributors under terms allowing the majority of distributors certain rights of return and price protection on unsold merchandise held by them. The Company estimates the amount of variable consideration under OEM and distributor arrangements and, accordingly, records a provision for product returns, allowances for price protection and rebates based on actual historical experience and any known events. The Company offers incentive programs to certain customers, including cooperative advertising, marketing promotions, volume based incentives and special pricing arrangements. Where funds provided for such programs can be estimated, the Company recognizes a reduction to revenue at the time the related revenue is recognized; otherwise, the Company recognizes such reduction to revenue at the later of when; i) the related revenue transaction occurs; or ii) the program is offered. For transactions where the Company reimburses a customer for a portion of the customer’s cost to perform specific product advertising or marketing and promotional activities, such amounts are recognized as a reduction to revenue unless they qualify for expense recognition. Custom products: Custom products which are associated with the Company’s Enterprise, Embedded, and Semi-Custom segment (semi-custom products), under non-cancellable purchases orders and have no alternative use to the Company at contract inception, are recognized as revenue, based on the value of the semi-custom products and expected margin, over the time of production of the products by the Company. Sale of semi-custom products are not subject to a right of return. Development and intellectual property licensing agreements: From time to time, the Company may enter into arrangements with customers that combine the provision of development services and a license to the right to use the intellectual property (IP), which is deemed to be a single performance obligation. Accordingly, the Company recognizes revenue for the entire consideration of the arrangement upon transfer of control of the IP license to the customer. Customers are generally required to pay for products and services within the Company’s standard contractual terms, which are typically net 30 to 60 days. The Company has determined that it does not have significant financing components in its contracts with customers. Refer to Note 3 Supplemental Balance Sheet Information, for further information regarding unearned revenue. Recently Adopted Accounting Standards Revenue from Contracts with Customers. In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers (ASC 606), which creates a single source of revenue guidance under U.S. GAAP for all companies in all industries and replaces most existing revenue recognition guidance in U.S. GAAP. Under the new standard, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the new standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The FASB has issued several amendments to the new standard, including clarification on accounting for licenses of intellectual property and identifying performance obligations. The Company adopted the new standard in the first quarter of 2018, using the full retrospective method, which required the Company to adjust prior reporting periods presented. The Company implemented internal controls and key system functionality to enable the preparation of financial information on adoption. The most significant impacts of the adoption of ASC 606 to the Company related to: (1) the acceleration of revenue recognition for sales of semi-custom products subject to a non-cancellable customer purchase order, (2) the acceleration of revenue recognition for sales to distributors, and (3) the timing and financial statement classification of certain development and intellectual property licensing agreements. Revenue from sales of semi-custom products under non-cancellable purchases orders and that have no alternative use to the Company at contract inception, is recognized, based on the value of the semi-custom products and expected margin, over the time of production of the semi-custom products by the Company, rather than upon shipment. Revenue from sales to the Company's distributors is recognized upon shipment of the product to the distributors (sell-in), net of provision for estimated reserves, instead of the previous revenue recognition which was upon the reported resale of the product by the distributors to their customers (sell-through). For a development and IP licensing agreement executed in 2017, the Company recognized IP-related revenue in the third quarter of 2018 for the entire consideration upon the completion of all the technology milestones. Previously, the agreement resulted in the reduction to research and development expenses in 2017 for development work as the expenses were incurred and would have resulted in licensing revenue to be recognized in periods beyond 2017 upon completion of the deliverables, based on a fair value allocation of the consideration received. Revenue recognition related to the Company’s other revenue streams remain substantially unchanged. The adoption of ASC 606 had an impact on the Company’s Consolidated Statements of Operations and Consolidated Balance Sheets, but had no impact on cash provided by or used in operating, financing, or investing activities on the Consolidated Statements of Cash Flows. The impact on the Company’s previously reported Consolidated Statement of Operations as a result of the adoption of the new standard was as follows:
The impact on the Company’s previously reported Consolidated Balance Sheets line items affected by the adoption of the new standard was as follows:
Income Taxes. In March 2018, the FASB issued ASU 2018-05, Income Taxes (ASC 740), Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 (SEC Update) (ASU 2018-05). The ASU 2018-05 includes certain provisions of the Securities and Exchange Commission (SEC) paragraphs pursuant to the issuance of the December 2017 SEC Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which was effective immediately. The SEC issued SAB 118 to address concerns about reporting entities’ ability to timely comply with the accounting requirements to recognize all of the effects of the Tax Cuts and Jobs Act of 2017 (the Tax Reform Act) in the period of enactment. SAB 118 allows disclosure that timely determination of some or all of the income tax effects from the Tax Reform Act are incomplete by the due date of the financial statements and if possible to provide a reasonable estimate. The Company has accounted for the tax effects of the Tax Reform Act under the guidance of SAB 118, on a provisional basis. During the nine months ended September 29, 2018, the Company did not recognize any adjustment to the provisional amounts recorded as of December 30, 2017. The Company will continue to assess the Tax Reform Act’s impact for the rest of 2018, including its interpretation by regulatory authorities and the courts, and will adjust its disclosures and financial presentation as necessary. Stock Compensation. In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (ASC 718): Scope of Modification Accounting (ASU 2017-09) to provide clarity and reduce both the (1) diversity in practice and (2) cost and complexity when changing the terms or conditions of share-based payment awards. Under ASU 2017-09, modification accounting is required to be applied unless all of the following criteria are the same immediately before and after the change: 1. The award’s fair value (or calculated value or intrinsic value, if those measurement methods are used); 2. The award’s vesting conditions; and 3. The award’s classification as an equity or liability instrument. ASU 2017-09 is effective for annual and interim periods beginning after December 15, 2017 on a prospective basis, and early adoption is permitted. The Company adopted this guidance in the first quarter of 2018 and the guidance did not have an impact on its consolidated financial statements. Statement of Cash Flows. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (ASC 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15), which is intended to reduce the existing diversity in practice in how certain cash receipts and cash payments are classified in the statement of cash flows. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows, Restricted Cash (ASU 2016-18), which requires the inclusion of restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. ASU 2016-15 and ASU 2016-18 are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years, provided that all of the amendments are adopted in the same period. The amendments will be applied using a retrospective transition method to each period presented. The Company adopted this guidance in the first quarter of 2018, which resulted in the additional presentation of restricted cash on the statement of cash flows for each period presented and had no material impact on its consolidated financial statements. Financial Instruments. In January 2016, the FASB issued ASU 2016-01, Financial Instruments—Overall (ASC 825): Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-01), which requires that most equity investments be measured at fair value, with subsequent changes in fair value recognized in net income. The ASU also impacts financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. Entities have to assess the realizability of such deferred tax assets in combination with the entities’ other deferred tax assets. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017 and for interim periods within those fiscal years. The Company adopted this guidance in the first quarter of 2018. For its equity securities that have readily determinable fair values, the Company recorded $2 million of a cumulative effect adjustment to retained earnings upon adoption. For its equity investments that do not have readily determinable fair values, the Company adopted the measurement alternative prospectively with no material impact on its consolidated financial statements. Recently Issued Accounting Standards Intangibles. In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (ASC 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which requires hosting arrangements that are service contracts to follow the guidance for internal-use software to determine which implementation costs can be capitalized. ASU 2018-15 is effective either prospectively or retrospectively for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating how to apply the new guidance. Reporting Comprehensive Income. In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (ASC 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (AOCI), which gives entities the option to reclassify to retained earnings the tax effects resulting from the Tax Reform Act related to items in AOCI that the FASB refers to as having been stranded in AOCI. The new guidance may be applied retrospectively to each period in which the effect of the Tax Reform Act is recognized in the period of adoption. The Company must adopt this guidance for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted for periods for which financial statements have not yet been issued or made available for issuance, including the period the Tax Reform Act was enacted. The guidance, when adopted, will require new disclosures regarding a company’s accounting policy for releasing the tax effects in AOCI and permit the company the option to reclassify to retained earnings the tax effects resulting from the Tax Reform Act that are stranded in AOCI. The Company is currently evaluating how to apply the new guidance. Leases. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations for lease recognition and disclosure. ASU 2016-02 requires lessees to recognize lease assets and lease liabilities on the balance sheet, while recognizing expenses on the income statements in a manner similar to current guidance. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The Company did not elect to early adopt this standard and therefore the standard will be effective for the Company in the first quarter of 2019. ASU 2016-02 requires that leases be recognized and measured as of the earliest period presented, using a modified retrospective approach, with all periods presented being adjusted and presented under the new standard. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provides companies an optional adoption method to ASU 2016-02 whereby a company does not have to adjust comparative period financial statements for the new standard. The Company plans to adopt the new standard using the optional adoption method and thereby not adjust comparative financial statements. The Company is currently evaluating the application of the new guidance and currently believes the most significant impact upon adoption will be the recognition of right-of-use assets and lease liabilities on the Company's consolidated balance sheets for its operating leases. The Company is progressing on implementing processes to comply with the guidance. There were no other significant updates to the recently issued accounting standards as disclosed in the Company’s Form 10-K for fiscal year 2017. Although there are several other new accounting pronouncements issued or proposed by the FASB, the Company does not believe any of these accounting pronouncements has had or will have a material impact on its consolidated financial position or operating results. |
GLOBALFOUNDRIES |
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Related Party Transactions [Abstract] | |
GLOBALFOUNDRIES | GLOBALFOUNDRIES Wafer Supply Agreement. The Company and GLOBALFOUNDRIES Inc. (GF) entered into a Wafer Supply Agreement (the WSA) in 2009, under which, among other terms, the Company would purchase wafers from GF. The WSA, which has been amended from time to time, governs the terms by which the Company purchases products manufactured by GF. Sixth Amendment to Wafer Supply Agreement. On August 30, 2016, the Company entered into a sixth amendment to the WSA (the WSA Sixth Amendment). The WSA Sixth Amendment modified certain terms of the WSA applicable to wafers for the Company’s microprocessor, graphics processor and semi-custom products for a five-year period from January 1, 2016 to December 31, 2020. The Company and GF also agreed to establish a comprehensive framework for technology collaboration for the 7nm technology node. The WSA Sixth Amendment also provides the Company a limited waiver with rights to contract with another wafer foundry with respect to certain products in the 14nm and 7nm technology nodes and gives the Company greater flexibility in sourcing foundry services across its product portfolio. In consideration for these rights, the Company agreed to pay GF $100 million, to be paid in a series of installments starting in the fourth quarter of 2016 through the third quarter of 2017. As of December 30, 2017, the Company had paid GF $100 million in aggregate. Starting in 2017 and continuing through 2020, the Company also agreed to make quarterly payments to GF based on the volume of certain wafers purchased from another wafer foundry. Further, for each calendar year during the term of the WSA Sixth Amendment, the Company and GF agreed to annual wafer purchase targets that increase from 2016 through 2020. If the Company does not meet the annual wafer purchase target for any calendar year, the Company will be required to pay to GF a portion of the difference between the Company’s actual wafer purchases and the wafer purchase target for that year. The annual targets were established based on the Company’s business and market expectations and took into account the limited waiver it received for certain products. In 2016 and 2017, the Company met its wafer purchase targets. As of September 29, 2018, the Company expects to meet its 2018 wafer purchase target. The Company and GF also agreed on fixed pricing for wafers purchased during 2016 and established a framework to agree on annual wafer pricing for the years 2017 to 2020. The Company and GF have agreed on pricing for wafer purchases for 2018. On August 27, 2018, GF announced that it was putting its 7nm FinFET program on hold indefinitely. The Company is presently focusing the breadth of its 7nm product portfolio on Taiwan Semiconductor Co., Ltd.’s (TSMC) 7nm process. The Company is in discussion with GF to modify the WSA to align with GF’s new business strategy. The Company’s total purchases from GF related to wafer manufacturing, research and development activities and other for the quarters ended September 29, 2018 and September 30, 2017 were $377 million and $331 million, respectively. The Company’s total purchases from GF related to wafer manufacturing, research and development activities and other for the nine months ended September 29, 2018 and September 30, 2017 were $1.2 billion and $773 million, respectively. Included in the total purchases for the three and nine months ended September 29, 2018 were amounts related to the volume of certain wafers purchased from another wafer foundry, as agreed by the Company and GF under the WSA Sixth Amendment. As of September 29, 2018 and December 30, 2017, the amount of prepayment and other receivables related to GF was $15 million and $27 million, respectively, included in Prepayment and receivables—related parties on the Company’s condensed consolidated balance sheets. As of September 29, 2018 and December 30, 2017, the amount of payable to GF was $321 million and $241 million, respectively, included in Payables to related parties on the Company’s condensed consolidated balance sheets. Warrant Agreement. Also on August 30, 2016, in consideration for the limited waiver and rights under the WSA Sixth Amendment, the Company entered into a warrant agreement (the Warrant Agreement) with West Coast Hitech L.P. (WCH), a wholly-owned subsidiary of Mubadala Development Company PJSC (Mubadala). Under the Warrant Agreement, WCH and its permitted assigns are entitled to purchase 75 million shares of the Company’s common stock (the Warrant Shares) at a purchase price of $5.98 per share. The warrant is exercisable in whole or in part until February 29, 2020. Notwithstanding the foregoing, the Warrant Agreement will only be exercisable to the extent that Mubadala does not beneficially own, either directly through any other entities directly and indirectly owned by Mubadala or its subsidiaries, an aggregate of more than 19.99% of the Company’s outstanding capital stock after any such exercise. GF continues to be a related party of the Company because Mubadala and Mubadala Technology Investments LLC (Mubadala Tech, a party to the WSA) are affiliated with WCH, a significant stockholder of the Company. GF, WCH and Mubadala Tech are wholly-owned subsidiaries of Mubadala. |
Supplemental Balance Sheet Information |
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Balance Sheet Related Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Balance Sheet Information | Supplemental Balance Sheet Information Accounts Receivable, net As of September 29, 2018 and December 30, 2017, Accounts receivable, net included unbilled accounts receivable of $331 million and $75 million, respectively. Unbilled receivables primarily represent work completed on semi-custom products under non-cancellable purchase orders that have no alternative use to the Company at contract inception, for which revenue has been recognized but not yet invoiced to customers. All unbilled accounts receivable are expected to be billed and collected within twelve months. Inventories, net
Property and Equipment, net
Other Assets
Accrued Liabilities
Other Current Liabilities
Unearned revenue represents consideration received or due from customers in advance of the Company satisfying its performance obligations. The unearned revenue is associated with any combination of development services, IP licensing and product revenue. Changes in unearned revenue were as follows:
Revenue allocated to remaining performance obligations that are unsatisfied (or partially unsatisfied) as of September 29, 2018 is $121 million, which may include amounts received from customer but not yet earned and amounts that will be invoiced and recognized as revenue in future periods associated with any combination of development services, IP licensing and product revenue. The Company expects to recognize $99 million in the next 12 months, and the remainder thereafter. As permitted under ASC 606, the Company has not disclosed the comparative amounts as of December 30, 2017. The revenue allocated to remaining performance obligations did not include amounts which have an original contractual expected duration of less than one year. |
Equity Interest Purchase Agreement - ATMP Joint Venture |
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Sep. 29, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Interest Purchase Agreement - ATMP Joint Venture | Equity Interest Purchase Agreement - ATMP Joint Venture In April 2016, the Company and certain of its subsidiaries completed the sale of a majority of the equity interests in Suzhou TF-AMD Semiconductor Co., Ltd. (formerly, AMD Technologies (China) Co., Ltd.), and TF-AMD Microelectronics (Penang) Sdn. Bhd. (formerly, Advanced Micro Devices Export Sdn. Bhd.), to affiliates of Tongfu Microelectronics Co., Ltd. (formerly, Nantong Fujitsu Microelectronics Co., Ltd.) (TFME), a Chinese joint stock company, to form two joint ventures (collectively, the ATMP JV). As a result of the sale, TFME’s affiliates own 85% of the equity interests in the ATMP JV while certain of the Company’s subsidiaries own the remaining 15%. The Company has no obligation to fund the ATMP JV. The Company accounts for its equity interests in the ATMP JV under the equity method of accounting due to its significant influence over the ATMP JV. As of September 29, 2018 and December 30, 2017, the carrying value of the Company’s investment in the ATMP JV was approximately $58 million and $58 million, respectively. The ATMP JV is a related party of the Company. The ATMP JV provides assembly, test, mark and packaging (ATMP) services to the Company. The Company currently pays the ATMP JV for ATMP services on a cost-plus basis. The Company assists the ATMP JV in its management of certain raw material inventory. The purchases from and resales back to the ATMP JV of the inventory under inventory management is reported within purchases and resales with the ATMP JV and does not impact the Company’s Statement of Operations. The Company’s total purchases from the ATMP JV during the three and nine months ended September 29, 2018 amounted to approximately $151 million and $429 million, respectively. The Company’s total purchases from the ATMP JV during the three and nine months ended September 30, 2017 amounted to approximately $131 million and $332 million, respectively. As of September 29, 2018 and December 30, 2017, the amount payable to the ATMP JV was $212 million and $171 million, respectively, included in Payables to related parties on the Company’s condensed consolidated balance sheets. The Company’s resales back to the ATMP JV during the three and nine months ended September 29, 2018 amounted to approximately $21 million and $40 million, respectively, and there were no resales back to the ATMP JV for the comparative periods of 2017. As of September 29, 2018 and December 30, 2017, the Company had receivables from ATMP JV of $19 million and $3 million, respectively, included in Prepayment and receivables—related parties on the Company’s condensed consolidated balance sheets. During the three and nine months ended September 29, 2018, the Company recorded $0 million and $2 million, respectively, in Equity loss in investee on its condensed consolidated statements of operations, which included certain expenses incurred by the Company on behalf of the ATMP JV. During the three and nine months ended September 30, 2017, the Company recorded $2 million and $7 million, respectively, in Equity loss in investee on its condensed consolidated statements of operations, which included certain expenses incurred by the Company on behalf of the ATMP JV. Equity Joint Venture In February 2016, the Company and Higon Information Technology Co., Ltd. (formerly, Tianjin Haiguang Advanced Technology Investment Co., Ltd.) (THATIC), a third-party Chinese entity (JV Partner), formed a joint venture comprised of two separate legal entities, China JV1 and China JV2 (collectively, the THATIC JV). The Company’s equity share in China JV1 and China JV2 is a majority and minority interest, respectively, funded by the Company’s contribution of certain of its patents. The JV Partner is responsible for the initial and on-going financing of the THATIC JV’s operations. The Company has no obligations to fund the THATIC JV. The Company concluded the China JV1 and China JV2 are not operating joint ventures and are variable interest entities due to their reliance on on-going financing by the JV Partner. The Company determined that it is not the primary beneficiary of either China JV1 or China JV2, as the Company does not have unilateral power to direct selling and marketing, manufacturing and product development activities related to the THATIC JV’s products. Accordingly, the Company does not consolidate either of these entities and therefore accounts for its investments in the THATIC JV under the equity method of accounting. The THATIC JV is a related party of the Company. In February 2016, the Company licensed certain of its intellectual property (Licensed IP) to the THATIC JV for a total of approximately $293 million in license fee payable over several years contingent upon achievement of certain milestones. The Company also expects to receive a royalty based on the sales of the THATIC JV’s products to be developed on the basis of such Licensed IP. The Company also provided certain engineering and technical support to the THATIC JV in connection with the product development. In March 2017, the Company entered into a development and intellectual property agreement (Development and IP) with THATIC JV, and also expects to receive a royalty based on the sales of the THATIC JV’s products to be developed on the basis of such agreement. In addition, from time to time, the Company enters into certain agreements with the THATIC JV to provide other services primarily related to research and development. The Company recognized income related to the Licensed IP over the period commencing upon delivery of the first Licensed IP milestone through the date of the milestone that required the Company’s continuing involvement in the product development process, which was completed at the end of the second quarter of 2017. Royalty payments will be recognized in income once earned. The Company classifies Licensed IP income and royalty income, associated with the February 2016 agreement, as licensing gain within other operating income. During the three and nine months ended September 29, 2018, the Company recognized $86 million of IP-related revenue upon completion of all technology milestones under the Development and IP agreement. During the three and nine months ended September 30, 2017, the Company recognized zero and $52 million, respectively, as licensing gain associated with the Licensed IP. The Company’s share in the net losses of the THATIC JV for the three and nine months ended September 29, 2018 was not material and is not recorded in the Company’s condensed consolidated statements of operations since the Company is not obligated to fund the THATIC JV’s losses in excess of the Company’s investment in the THATIC JV, which was zero as of September 29, 2018. The Company’s receivable from the THATIC JV for these agreements was $19 million and $3 million as of September 29, 2018 and December 30, 2017, respectively, included in Prepayment and receivables—related parties on its condensed consolidated balance sheets. As of September 29, 2018, the total assets and liabilities of the THATIC JV were not material. |
Equity Joint Venture |
9 Months Ended |
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Equity Method Investments and Joint Ventures [Abstract] | |
Equity Joint Venture | Equity Interest Purchase Agreement - ATMP Joint Venture In April 2016, the Company and certain of its subsidiaries completed the sale of a majority of the equity interests in Suzhou TF-AMD Semiconductor Co., Ltd. (formerly, AMD Technologies (China) Co., Ltd.), and TF-AMD Microelectronics (Penang) Sdn. Bhd. (formerly, Advanced Micro Devices Export Sdn. Bhd.), to affiliates of Tongfu Microelectronics Co., Ltd. (formerly, Nantong Fujitsu Microelectronics Co., Ltd.) (TFME), a Chinese joint stock company, to form two joint ventures (collectively, the ATMP JV). As a result of the sale, TFME’s affiliates own 85% of the equity interests in the ATMP JV while certain of the Company’s subsidiaries own the remaining 15%. The Company has no obligation to fund the ATMP JV. The Company accounts for its equity interests in the ATMP JV under the equity method of accounting due to its significant influence over the ATMP JV. As of September 29, 2018 and December 30, 2017, the carrying value of the Company’s investment in the ATMP JV was approximately $58 million and $58 million, respectively. The ATMP JV is a related party of the Company. The ATMP JV provides assembly, test, mark and packaging (ATMP) services to the Company. The Company currently pays the ATMP JV for ATMP services on a cost-plus basis. The Company assists the ATMP JV in its management of certain raw material inventory. The purchases from and resales back to the ATMP JV of the inventory under inventory management is reported within purchases and resales with the ATMP JV and does not impact the Company’s Statement of Operations. The Company’s total purchases from the ATMP JV during the three and nine months ended September 29, 2018 amounted to approximately $151 million and $429 million, respectively. The Company’s total purchases from the ATMP JV during the three and nine months ended September 30, 2017 amounted to approximately $131 million and $332 million, respectively. As of September 29, 2018 and December 30, 2017, the amount payable to the ATMP JV was $212 million and $171 million, respectively, included in Payables to related parties on the Company’s condensed consolidated balance sheets. The Company’s resales back to the ATMP JV during the three and nine months ended September 29, 2018 amounted to approximately $21 million and $40 million, respectively, and there were no resales back to the ATMP JV for the comparative periods of 2017. As of September 29, 2018 and December 30, 2017, the Company had receivables from ATMP JV of $19 million and $3 million, respectively, included in Prepayment and receivables—related parties on the Company’s condensed consolidated balance sheets. During the three and nine months ended September 29, 2018, the Company recorded $0 million and $2 million, respectively, in Equity loss in investee on its condensed consolidated statements of operations, which included certain expenses incurred by the Company on behalf of the ATMP JV. During the three and nine months ended September 30, 2017, the Company recorded $2 million and $7 million, respectively, in Equity loss in investee on its condensed consolidated statements of operations, which included certain expenses incurred by the Company on behalf of the ATMP JV. Equity Joint Venture In February 2016, the Company and Higon Information Technology Co., Ltd. (formerly, Tianjin Haiguang Advanced Technology Investment Co., Ltd.) (THATIC), a third-party Chinese entity (JV Partner), formed a joint venture comprised of two separate legal entities, China JV1 and China JV2 (collectively, the THATIC JV). The Company’s equity share in China JV1 and China JV2 is a majority and minority interest, respectively, funded by the Company’s contribution of certain of its patents. The JV Partner is responsible for the initial and on-going financing of the THATIC JV’s operations. The Company has no obligations to fund the THATIC JV. The Company concluded the China JV1 and China JV2 are not operating joint ventures and are variable interest entities due to their reliance on on-going financing by the JV Partner. The Company determined that it is not the primary beneficiary of either China JV1 or China JV2, as the Company does not have unilateral power to direct selling and marketing, manufacturing and product development activities related to the THATIC JV’s products. Accordingly, the Company does not consolidate either of these entities and therefore accounts for its investments in the THATIC JV under the equity method of accounting. The THATIC JV is a related party of the Company. In February 2016, the Company licensed certain of its intellectual property (Licensed IP) to the THATIC JV for a total of approximately $293 million in license fee payable over several years contingent upon achievement of certain milestones. The Company also expects to receive a royalty based on the sales of the THATIC JV’s products to be developed on the basis of such Licensed IP. The Company also provided certain engineering and technical support to the THATIC JV in connection with the product development. In March 2017, the Company entered into a development and intellectual property agreement (Development and IP) with THATIC JV, and also expects to receive a royalty based on the sales of the THATIC JV’s products to be developed on the basis of such agreement. In addition, from time to time, the Company enters into certain agreements with the THATIC JV to provide other services primarily related to research and development. The Company recognized income related to the Licensed IP over the period commencing upon delivery of the first Licensed IP milestone through the date of the milestone that required the Company’s continuing involvement in the product development process, which was completed at the end of the second quarter of 2017. Royalty payments will be recognized in income once earned. The Company classifies Licensed IP income and royalty income, associated with the February 2016 agreement, as licensing gain within other operating income. During the three and nine months ended September 29, 2018, the Company recognized $86 million of IP-related revenue upon completion of all technology milestones under the Development and IP agreement. During the three and nine months ended September 30, 2017, the Company recognized zero and $52 million, respectively, as licensing gain associated with the Licensed IP. The Company’s share in the net losses of the THATIC JV for the three and nine months ended September 29, 2018 was not material and is not recorded in the Company’s condensed consolidated statements of operations since the Company is not obligated to fund the THATIC JV’s losses in excess of the Company’s investment in the THATIC JV, which was zero as of September 29, 2018. The Company’s receivable from the THATIC JV for these agreements was $19 million and $3 million as of September 29, 2018 and December 30, 2017, respectively, included in Prepayment and receivables—related parties on its condensed consolidated balance sheets. As of September 29, 2018, the total assets and liabilities of the THATIC JV were not material. |
Debt and Secured Revolving Line of Credit |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt and Secured Revolving Line of Credit | Debt and Secured Revolving Line of Credit Debt 2.125% Convertible Senior Notes Due 2026 In September 2016, the Company issued $805 million, in aggregate, principal amount of 2.125% Convertible Senior Notes due 2026 (2.125% Notes). The 2.125% Notes are general unsecured senior obligations of the Company. The interest is payable semi-annually in March and September of each year, commencing in March 2017. As of September 29, 2018, the Company had $805 million principal amount outstanding. The 2.125% Notes mature on September 1, 2026. However, as outlined in the indenture governing the 2.125% Notes, holders of the 2.125% Notes may convert them at their option during certain time periods and upon the occurrence of one of the following circumstances: (1) during any calendar quarter commencing after the calendar quarter ending on September 30, 2016 (and only during such calendar quarter), if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day (equivalent to an initial conversion price of approximately $8.00 per share of common stock); (2) during the five business day period after any ten consecutive trading day period (the Measurement Period) in which the trading price per $1,000 principal amount of notes for each trading day of the Measurement Period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after June 1, 2026 until the close of business on the business day immediately preceding the maturity date, holders may convert their notes at any time, regardless of the foregoing circumstances. Upon conversion, the Company will pay or deliver cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election. The first event described in (1) above was met during the third quarter of 2018 and as a result, the 2.125% Notes are convertible at the option of the holder from October 1, 2018 and remain convertible until December 31, 2018. The Company’s current intent is to deliver shares of its common stock upon conversion of the 2.125% Notes. As such, the Company continued to classify the carrying value of the liability component of the 2.125% Notes as long-term debt and the equity component of the 2.125% Notes as permanent equity on its condensed consolidated balance sheet as of September 29, 2018. The 2.125% Notes consisted of the following:
As of September 29, 2018, the remaining life of the 2.125% Notes was approximately 96 months. Based on the closing price of the Company’s common stock of $30.89 on September 28, 2018, the last trading day of the third quarter of 2018, the if-converted value of the 2.125% Notes exceeded its principal amount by approximately $2,303 million. The effective interest rate of the liability component of the 2.125% Notes is 8%. This interest rate was based on the interest rates of similar liabilities at the time of issuance that did not have associated conversion features. The following table sets forth total interest expense recognized related to the 2.125% Notes:
6.75% Senior Notes Due 2019 On February 26, 2014, the Company issued $600 million of its 6.75% Senior Notes due 2019 (6.75% Notes). The 6.75% Notes are general unsecured senior obligations of the Company. Interest is payable on March 1 and September 1 of each year beginning September 1, 2014 until the maturity date of March 1, 2019. The 6.75% Notes are governed by the terms of an indenture (the 6.75% Indenture) dated February 26, 2014 between the Company and Wells Fargo Bank, N.A., as trustee. During the three months ended September 29, 2018, the Company settled $87 million in aggregate principal amount of its 6.75% Notes with treasury stock. During the nine months ended September 29, 2018, the Company settled $101 million in aggregate principal amount of its 6.75% Notes, of which $14 million was settled in cash. As of September 29, 2018, the outstanding aggregate principal amount of the 6.75% Notes was $66 million, which is included in short-term debt on the condensed consolidated balance sheet. 7.50% Senior Notes Due 2022 On August 15, 2012, the Company issued $500 million of its 7.50% Senior Notes due 2022 (7.50% Notes). The 7.50% Notes are general unsecured senior obligations of the Company. Interest is payable on February 15 and August 15 of each year beginning February 15, 2013 until the maturity date of August 15, 2022. The 7.50% Notes are governed by the terms of an indenture (the 7.50% Indenture) dated August 15, 2012 between the Company and Wells Fargo Bank, N.A., as trustee. During the three and nine months ended September 29, 2018, the Company settled $10 million in aggregate principal amount of its 7.50% Notes with treasury stock. As of September 29, 2018, the outstanding aggregate principal amount of the 7.50% Notes was $337 million. 7.00% Senior Notes Due 2024 On June 16, 2014, the Company issued $500 million of its 7.00% Senior Notes due 2024 (7.00% Notes). The 7.00% Notes are general unsecured senior obligations of the Company. Interest is payable on January 1 and July 1 of each year beginning January 1, 2015 until the maturity date of July 1, 2024. The 7.00% Notes are governed by the terms of an indenture (the 7.00% Indenture) dated June 16, 2014 between the Company and Wells Fargo Bank, N.A., as trustee. During the nine months ended September 29, 2018, the Company repurchased $1 million in aggregate principal amount of its 7.00% Notes in cash. As of September 29, 2018, the outstanding aggregate principal amount of the 7.00% Notes was $310 million. During the three and nine months ended September 29, 2018, the Company recorded $6 million and $7 million loss, respectively, on extinguishment of debt associated with the debt repurchases noted above. Potential Repurchase of Outstanding Notes The Company may elect to purchase or otherwise retire the 6.75% Notes, 7.50% Notes, 7.00% Notes and 2.125% Notes with cash, stock or other assets from time to time in open market or privately negotiated transactions, either directly or through intermediaries, or by tender offer when the Company believes the market conditions are favorable. Secured Revolving Line of Credit On April 14, 2015, the Company, AMD International Sales & Service, Ltd. (collectively, the Borrowers), ATI Technologies ULC (together with the Borrowers, collectively the Loan Parties), a group of lenders and Bank of America N.A., acting as the agent for the lenders, entered into an amended and restated loan and security agreement, as amended (the Agreement). The Agreement provides for a secured revolving line of credit (the Secured Revolving Line of Credit) that allows the Borrowers to borrow, repay and re-borrow amounts from time to time up to $500 million with up to $45 million available for issuance of letters of credit, subject to certain conditions. Borrowings are limited up to a certain amount of eligible accounts receivable, as determined in accordance with the Agreement. The size of the commitment under the Secured Revolving Line of Credit may be increased by up to an aggregate amount of $200 million. The commitments under the Secured Revolving Line of Credit are available through March 21, 2022. The Borrowers are subject to commitment fees and letter of credit facility fees. The Loan Parties are required to comply with certain covenants under the Agreement. The Secured Revolving Line of Credit bears interest, at the option of the Borrowers, either at (a) a customary London Interbank Offered Rate (LIBOR) plus an applicable margin (as determined in accordance with the agreement), or (b) (i) the greatest of (x) the bank’s prime rate, (y) the federal funds rate as published by the Federal Reserve Bank of New York plus 0.50%, and (z) LIBOR for a one-month period plus 1.00%, plus (ii) an applicable margin. As of September 29, 2018 and December 30, 2017, the Secured Revolving Line of Credit had an outstanding loan balance of $70 million, at an interest rate of 5.50% and 4.75%, respectively. As of September 29, 2018, the Company had $26 million of letters of credit outstanding and up to $205 million available for future borrowings under the Secured Revolving Line of Credit. The Company reports its intra-period changes in its revolving credit balance on a net basis in its condensed consolidated statement of cash flows as the Company intends the period of the borrowings to be brief, repaying borrowed amounts within 90 days. As of September 29, 2018, the Loan Parties were in compliance with all required covenants under the Agreement. |
Earnings (Loss) Per Share |
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Earnings (Loss) Per Share | Earnings (Loss) Per Share Basic earnings (loss) per share is computed based on the weighted average number of shares outstanding. Diluted earnings (loss) per share is computed based on the weighted average number of shares outstanding plus potentially dilutive shares outstanding during the period using the average market price for the respective period. Potentially dilutive shares are determined by applying the treasury stock method to the assumed exercise of outstanding stock options, the assumed vesting of outstanding RSUs, and the assumed exercise of the warrant under the Warrant Agreement with WCH. Potentially dilutive shares issuable upon conversion of the 2.125% Notes are calculated using the if-converted method. The following table sets forth the components of basic and diluted earnings (loss) per share:
Potential shares from certain employee stock options, restricted stock units and the conversion of the 2.125% Notes totaling 103 million for the third quarter of 2018 were not included in the earnings (loss) per share calculation because their inclusion would have been anti-dilutive. Potential shares from certain employee stock options, restricted stock units, the conversion of the 2.125% Notes and the warrants under the Warrant Agreement totaling 102 million for the third quarter of 2017 were not included in the earnings (loss) per share calculation because their inclusion would have been anti-dilutive. Potential shares from certain employee stock options, restricted stock units and the conversion of the 2.125% Notes totaling 104 million for the nine months ended September 29, 2018 were not included in the earnings (loss) per share calculation because their inclusion would have been anti-dilutive. Potential shares from certain employee stock options, restricted stock units, the conversion of the 2.125% Notes and the warrants under the Warrant Agreement totaling 193 million for the nine months ended September 30, 2017 were not included in the earnings (loss) per share calculation because their inclusion would have been anti-dilutive. |
Financial Instruments |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Instruments | Financial Instruments Cash, Cash Equivalents, and Marketable Securities Cash and financial instruments measured and recorded at fair value as of September 29, 2018 and December 30, 2017 are summarized below:
In addition to those amounts presented above, as of September 29, 2018 and December 30, 2017, the Company had approximately $5 million and $2 million, respectively, of investments in government money market funds, used as collateral for letters of credit deposits, which were included in Other current assets on the Company’s condensed consolidated balance sheets. These government money market funds are classified within Level 1 because they are valued using quoted prices for identical instruments in active markets. Their amortized cost approximates the fair value for all periods presented. As of September 29, 2018 and December 30, 2017, the Company also had approximately $22 million and $18 million, respectively, of investments in mutual funds held in a Rabbi trust established for the Company’s deferred compensation plan, which were included in Other assets on the Company’s condensed consolidated balance sheets. These mutual funds are classified within Level 1 because they are valued using quoted prices for identical instruments in active markets. Their amortized cost approximates the fair value for all periods presented. The Company is restricted from accessing these investments. As of both September 29, 2018 and December 30, 2017, the Company had the carrying value of approximately $3 million in cost method investments. Financial Instruments Not Recorded at Fair Value on a Recurring Basis. The Company carries its financial instruments at fair value with the exception of its debt. Financial instruments that are not recorded at fair value are measured at fair value on a quarterly basis for disclosure purposes. The carrying amounts and estimated fair values of financial instruments not recorded at fair value are as follows:
The Company’s long-term debt is classified within Level 2. The fair value of the debt was estimated based on the quoted market prices for the same or similar issues or on the current rates offered to the Company for debt of the same remaining maturities. The fair value of the Company’s accounts receivable, accounts payable and other short-term obligations approximate their carrying value based on existing payment terms. Hedging Transactions and Derivative Financial Instruments Cash Flow Hedges and Foreign Currency Forward Contracts not Designated as Hedges The following table shows the amount of gains (losses) included in accumulated other comprehensive income (loss), the amount of gains (losses) reclassified from accumulated other comprehensive income (loss) and included in earnings related to foreign currency forward contracts designated as cash flow hedges and the amount of gains (losses) included in other income (expense), net, related to contracts not designated as hedging instruments which was allocated in the consolidated statements of operations:
The Company’s foreign currency derivative contracts are classified within Level 2 because the valuation inputs are based on quoted prices and market observable data of similar instruments in active markets, such as currency spot and forward rates. The following table shows the fair value amounts included in Other current assets should the foreign currency forward contracts be in a gain position or included in Other current liabilities should these contracts be in a loss position. These amounts were recorded in the Company’s condensed consolidated balance sheets as follows:
For the foreign currency contracts designated as cash flow hedges, the ineffective portions of the hedging relationship and the amounts excluded from the assessment of hedge effectiveness were immaterial. As of September 29, 2018 and December 30, 2017, the notional values of the Company’s outstanding foreign currency forward contracts were $326 million and $300 million, respectively. All the contracts mature within 12 months, and, upon maturity, the amounts recorded in Accumulated other comprehensive income (loss) are expected to be reclassified into earnings. The Company hedges its exposure to the variability in future cash flows for forecasted transactions over a maximum of 12 months. |
Income Taxes |
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Sep. 29, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes In December 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Reform Act. The legislation significantly changes U.S. tax law by, among other things, lowering corporate income tax rates, implementing a modified territorial tax system and imposing a transition tax on deemed repatriated earnings of foreign subsidiaries. The Tax Reform Act reduces the U.S. corporate income tax rate from a maximum of 35% to a flat 21% rate, effective January 1, 2018. ASC 740: Income Taxes, requires companies to recognize the effect of the tax law changes in the period of enactment. However, the SEC staff issued Staff Accounting Bulletin 118 which allows companies to record provisional amounts during a measurement period that is similar to the measurement period used when accounting for business combinations. During the nine months ended September 29, 2018, the Company did not recognize any adjustment to the provisional amounts recorded as of December 30, 2017. The Company will continue to assess the Tax Reform Act’s impact for the rest of 2018, including its interpretation by regulatory authorities and the courts, and will adjust its disclosures and financial presentation as necessary. Given the complexity of the Global Intangible Low-Taxed Income (GILTI) provisions, the Company is still evaluating the effects of the GILTI provisions and has not yet determined its accounting policy. As of September 29, 2018, because the Company is still evaluating the GILTI provisions and its analysis of future taxable income that is subject to GILTI, the Company has considered GILTI related to current-year operations only in its estimated annualized effective tax rate and has not provided additional GILTI on deferred items. In the third quarter of 2018, the Company recorded an income tax provision of $12 million, consisting primarily of $5 million for federal base erosion and anti-abuse tax, which is a new tax under the Tax Reform Act, and $7 million for withholding taxes applicable to IP-related revenue from foreign locations. For the nine months ended September 29, 2018, the Company recorded an income tax provision of $26 million, consisting primarily of $15 million for federal base erosion and anti-abuse tax, $7 million for withholding taxes applicable to IP-related revenue from foreign locations, and $4 million of foreign taxes in profitable locations. In the third quarter of 2017, the Company recorded an income tax provision of $22 million, consisting primarily of withholding taxes applicable to IP-related revenue from foreign locations. For the nine months ended September 30, 2017, the Company recorded an income tax provision of $30 million, consisting primarily of withholding taxes applicable to IP-related revenue and licensing gain from foreign locations. As of September 29, 2018, substantially all of the Company’s U.S. and Canadian deferred tax assets, net of deferred tax liabilities, continue to be subject to a valuation allowance. The realization of these assets is dependent on substantial future taxable income which, as of September 29, 2018, in management’s estimate, is not more likely than not to be achieved. The Company’s total gross unrecognized tax benefits were $51 million as of September 29, 2018. The Company does not believe it is reasonably possible that unrecognized tax benefits will materially change in the next 12 months. However, the settlement, resolution or closure of tax audits are highly uncertain. |
Segment Reporting |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting | Segment Reporting Management, including the Chief Operating Decision Maker, who is the Company’s Chief Executive Officer, reviews and assesses operating performance using segment net revenue and operating income before interest, other income (expense), net and income taxes. These performance measures include the allocation of expenses to the operating segments based on management’s judgment. The Company has the following two reportable segments:
In addition to these reportable segments, the Company has an All Other category, which is not a reportable segment. This category primarily includes certain expenses and credits that are not allocated to any of the reportable segments because management does not consider these expenses and credits in evaluating the performance of the reportable segments. This category also includes employee stock-based compensation expense. The following table provides a summary of net revenue and operating income by segment:
(1) All Other operating loss is related to stock-based compensation expense for the three and nine months ended September 29, 2018 and September 30, 2017. |
Stock-Based Incentive Compensation Plans |
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Sep. 29, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Incentive Compensation Plans | Stock-Based Incentive Compensation Plans Stock Options During the three and nine months ended September 29, 2018, the Company granted 1.0 million and 1.1 million shares of employee stock options, respectively, with weighted average grant date fair value per share of $8.08 and $7.62, respectively. During the three and nine months ended September 30, 2017, the Company granted 0.9 million shares of employee stock options with weighted average grant date fair value per share of $5.46. Restricted Stock Units During the three and nine months ended September 29, 2018, the Company granted 8.8 million and 12.0 million shares of restricted stock units, respectively, including 0.8 million and 1.0 million performance-based restricted stock units (PRSUs), respectively, with market conditions, with weighted average grant date fair value per share of $19.81 and $17.83, respectively. During the three and nine months ended September 30, 2017, the Company granted 8.3 million and 10.4 million shares of restricted stock units, respectively, including 0.8 million PRSUs with market conditions for both periods, with weighted average grant date fair value per share of $13.24 and $13.03, respectively. Performance-based Restricted Stock Units with Market Conditions From time to time, the Company grants restricted stock units with both a market condition and a service condition (market-based restricted stock units) to its senior executives. The number of shares earned are dependent upon achievement of the market conditions and vest at the end of the performance period, subject to the requisite service conditions. During the three and nine months ended September 29, 2018, the Company granted 0.8 million and 1.0 million market-based restricted stock units, respectively, with weighted average grant date fair value per share of $23.97 and $21.67, respectively. During the three and nine months ended September 30, 2017, the Company granted 0.8 million market-based restricted stock units with weighted average grant date fair value per share of $17.18. Employee Stock Purchase Plan (ESPP) During the nine months ended September 29, 2018, 2.2 million shares of common stock were purchased under the ESPP at a purchase price of $9.57, resulting in cash proceeds of $21 million. The fair value of stock purchase rights granted under the ESPP during the second quarter of 2018 was $3.42 per share. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies | Commitments and Contingencies Warranties and Indemnities The Company generally warrants that its products sold to its customers will conform to the Company’s approved specifications and be free from defects in material and workmanship under normal use and service for one year. Subject to certain exceptions, the Company also offers a three-year limited warranty to end users for only those central processing unit (CPU) and accelerated processing unit (APU) products that are commonly referred to as “processors in a box” and for certain server CPU products. The Company also offers extended limited warranties to certain customers of “tray” microprocessor products and/or professional graphics products who have written agreements with the Company and target their computer systems at the commercial and/or embedded markets. Changes in the Company’s estimated liability for product warranty were as follows:
In addition to product warranties, the Company, from time to time in its normal course of business, indemnifies other parties, with whom it enters into contractual relationships, including customers, lessors and parties to other transactions with the Company with respect to certain matters. In these limited matters, the Company has agreed to hold certain third parties harmless against specific types of claims or losses, such as those arising from a breach of representations or covenants, third-party claims that the Company’s products, when used for their intended purpose(s) and under specific conditions, infringe the intellectual property rights of a third party, or other specified claims made against the indemnified party. It is not possible to determine the maximum potential amount of liability under these indemnification obligations due to the unique facts and circumstances that are likely to be involved in each particular claim and indemnification provision. Historically, payments made by the Company under these obligations have not been material. Contingencies Shareholder Derivative Lawsuits (Wessels, Hamilton and Ha) On March 20, 2014, a purported shareholder derivative lawsuit captioned Wessels v. Read, et al., Case No. 1:14 cv-262486 (Wessels) was filed against the Company (as a nominal defendant only) and certain of its directors and officers in the Santa Clara County Superior Court of the State of California. The complaint purports to assert claims against the Company and certain individual directors and officers for breach of fiduciary duty, waste of corporate assets and unjust enrichment. The complaint seeks damages allegedly caused by alleged materially misleading statements and/or material omissions by the Company and the individual directors and officers regarding its 32nm technology and “Llano” product, which statements and omissions, the plaintiffs claim, allegedly operated to artificially inflate the price paid for the Company’s common stock during the period. On April 27, 2015, a similar purported shareholder derivative lawsuit captioned Christopher Hamilton and David Hamilton v. Barnes, et al., Case No. 5:15-cv-01890 (Hamilton) was filed against the Company (as a nominal defendant only) and certain of its directors and officers in the United States District Court for the Northern District of California. On September 29, 2015, a similar purported shareholder derivative lawsuit captioned Jake Ha v Caldwell, et al., Case No. 3:15-cv-04485 (Ha) was filed against the Company (as a nominal defendant only) and certain of its directors and officers in the United States District Court for the Northern District of California. The lawsuit also seeks a court order voiding the stockholder vote on the Company’s 2015 proxy. The case was transferred to the judge handling the Hamilton Lawsuit and is now Case No. 4:15-cv-04485. The Wessels, Hamilton and Ha shareholder derivative lawsuits were stayed pending resolution of a class action lawsuit captioned Hatamian v. AMD, et al., C.A. No. 3:14-cv-00226 filed against the Company in the United States District Court for the Northern District of California (the Hatamian Lawsuit). The Hatamian Lawsuit asserted claims against the Company and certain of its officers for alleged violations of Section 10(b) of the Securities Exchange Act of 1934, as amended (the Exchange Act), and SEC Rule 10b-5 concerning certain statements regarding our 32nm technology and “Llano” products. On October 9, 2017, the parties signed a definitive settlement agreement resolving the Hatamian Lawsuit and submitted it to the Court for approval. Under the terms of this agreement, the settlement was funded entirely by certain of AMD’s insurance carriers and the defendants continued to deny any liability or wrongdoing. On March 2, 2018, the court approved the settlement and entered a final judgment in the Hatamian lawsuit. On January 30, 2018, the Wessels and Hamilton plaintiffs amended their complaints. On February 2, 2018, the Ha plaintiff also filed an amended complaint. On February 22, 2018, the Company filed motions to dismiss the Hamilton and Ha plaintiffs’ amended complaints. On April 2, 2018, we filed a demurrer seeking to dismiss the Wessels amended complaint. On July 23, 2018, the Santa Clara Superior Court sustained the Company's demurrer in the Wessels case, dismissing all claims in that matter with prejudice. The Wessels plaintiff filed a Notice of Appeal on September 27, 2018. On October 4, 2018, the Court issued an order dismissing the Hamilton and Ha amended complaints. The Hamilton plaintiffs filed a Notice of Appeal on October 8, 2018. Based upon information presently known to management, the Company believes that the potential liability, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. Kim Securities Litigation On January 16, 2018, a putative class action lawsuit captioned Kim et al. v. AMD, et al., Case No. 3:18-cv-00321 was filed against the Company in the United States District Court for the Northern District of California. The complaint purports to assert claims against the Company and certain individual officers for alleged violations of Sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5 of the Exchange Act. The plaintiff seeks to represent a proposed class of all persons who purchased or otherwise acquired the Company’s common stock during the period February 21, 2017 through January 11, 2018. The complaint seeks damages allegedly caused by alleged materially misleading statements and/or material omissions by the Company and the individual officers regarding a security vulnerability (Spectre), which statements and omissions, the plaintiff claims, allegedly caused the Company’s common stock price to be artificially inflated during the purported class period. The complaint seeks unspecified compensatory damages, attorneys’ fees and costs. On August 3, 2018, plaintiffs filed an amended complaint with similar allegations and shortening the class period to June 29, 2017 through January 11, 2018. The Company filed a motion to dismiss plaintiffs’ claims on September 25, 2018. Based upon information presently known to management, the Company believes that the potential liability, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. Hauck Litigation Since January 19, 2018, three putative class action complaints have been filed against the Company in the United States District Court for the Northern District of California: (1) Diana Hauck et al. v. AMD, Inc., Case No. 5:18-cv-0047, filed on January 19, 2018; (2) Brian Speck et al. v. AMD, Inc., Case No. 5:18-cv-0744, filed on February 4, 2018; and (3) Nathan Barnes and Jonathan Caskey-Medina, et al. v. AMD, Inc., Case No. 5:18-cv-00883, filed on February 9, 2018. On April 9, 2018, the court consolidated these cases and ordered that Diana Hauck et al. v. AMD, Inc. serve as the lead case. On June 13, 2018, six plaintiffs (from California, Louisiana, Florida, and Massachusetts) filed a consolidated amended complaint alleging that the Company failed to disclose its processors’ alleged vulnerability to Spectre. Plaintiffs further allege that the Company's processors cannot perform at its advertised processing speeds without exposing consumers to Spectre, and that any “patches” to remedy this security vulnerability will result in degradation of processor performance. The plaintiffs seek damages under several causes of action on behalf of a nationwide class and four state subclasses (California, Florida, Massachusetts, Louisiana) of consumers who purchased AMD processors and/or devices containing AMD processors. The plaintiffs also seek attorneys’ fees, equitable relief, and restitution. Pursuant to the court's order directing parties to litigate only eight of the causes of action in the consolidated amended complaint initially, the Company filed a motion to dismiss on July 13, 2018. On October 29, 2018, after the plaintiffs voluntarily dismissed one of their claims, the court granted the Company's motion and dismissed six causes of action with leave to amend. The plaintiffs have until November 28, 2018 to file another amended complaint. Based upon information presently known to management, the Company believes that the potential liability, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. Zeng Shareholder Derivative Lawsuit On March 8, 2018, a purported shareholder derivative lawsuit captioned Zeng v. Su, et al., Case No. 18CIV01192 was filed against the Company (as a nominal defendant only) and certain of the Company’s directors and officers in the San Mateo County Superior Court of the State of California. The complaint purports to assert claims against the Company and certain individual directors and officers for breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement and waste of corporate assets. The complaint seeks damages allegedly caused by alleged materially misleading statements and/or material omissions by the Company and the individual directors and officers regarding Spectre, which statements and omissions, the plaintiffs claim, allegedly operated to artificially inflate the price paid for the Company's common stock during the period. On April 26, 2018, the lawsuit was transferred to Santa Clara County and assigned a new case number, 18CV327692. On August 14, 2018, the Court stayed this lawsuit pending a decision on the motion to dismiss in Kim et al. v. AMD, et al., Case No. 3:18-cv-00321 filed against the Company in the United States District Court for the Northern District of California. Based upon information presently known to management, the Company believes that the potential liability, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. In re Advanced Micro Devices, Inc. Shareholder Derivative Lawsuit Two purported shareholder derivative lawsuits were filed against the Company (as a nominal defendant only) and certain of its directors and officers in the United States District Court, Northern District of California: (1) Jacqueline Dolby, derivatively on behalf of AMD, Inc. v. Su et al., Case No. 5:18-cv-03575, filed on June 14, 2018; and (2) Gusinsky Trust, derivatively on behalf of AMD, Inc. v. Su et al., Case No. 5:18-cv-03811, filed on June 26, 2018. The complaints purport to assert claims against the Company and certain individual directors and officers for violation of Section 14(a) of the Exchange Act and SEC Rule 14a-9, breach of fiduciary duty, waste of corporate assets, and unjust enrichment. The complaints seek damages purportedly caused by alleged materially misleading statements and/or material omissions by the Company and the individual directors and officers regarding Spectre. The plaintiffs allege that these statements and omissions operated to artificially inflate the price paid for the Company's common stock during the period. On July 12, 2018, the court consolidated the Dolby and Gusinsky Trust shareholder derivative lawsuits under the caption In re Advanced Micro Devices, Inc. Shareholder Derivative Litigation. On August 10, 2018, the Court stayed this lawsuit pending a decision on the motion to dismiss in Kim et al. v. AMD, et al., Case No. 3:18-cv-00321 filed against the Company in the United States District Court for the Northern District of California. Based upon information presently known to management, the Company believes that the potential liability, if any, will not have a material adverse effect on its financial condition, cash flows or results of operations. Other Legal Matters The Company is a defendant or plaintiff in various actions that arose in the normal course of business. With respect to these matters, based on the management’s current knowledge, the Company believes that the amount or range of reasonably possible loss, if any, will not, either individually or in the aggregate, have a material adverse effect on the Company’s business, financial position and results of operations or cash flows. |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) The tables below summarize the changes in accumulated other comprehensive income (loss) by component:
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Basis of Presentation and Significant Accounting Policies (Policies) |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation | Basis of Presentation. The accompanying unaudited condensed consolidated financial statements of Advanced Micro Devices, Inc. and its subsidiaries (the Company or AMD) 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. The results of operations for the three and nine months ended September 29, 2018 shown in this report are not necessarily indicative of results to be expected for the full year ending December 29, 2018. In the opinion of the Company’s management, the information contained herein reflects all adjustments necessary for a fair presentation of the Company’s results of operations, financial position and cash flows. All such adjustments are of a normal, recurring nature. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements in the Company’s Annual Report on Form 10-K for the year ended December 30, 2017. |
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Fiscal Period | The Company uses a 52 or 53 week fiscal year ending on the last Saturday in December. The three and nine months ended September 29, 2018 and September 30, 2017 each consisted of 13 weeks and 39 weeks, respectively. |
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Principles of Consolidation | Principles of Consolidation. The condensed consolidated financial statements include the Company’s accounts and those of its wholly-owned subsidiaries. Upon consolidation, all significant inter-company accounts and transactions are eliminated. |
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Revenue Recognition | Revenue Recognition. Revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. Sales, value-added, and other taxes collected concurrently with the provision of goods or services are excluded from revenue. Shipping and handling costs associated with product sales are included in cost of sales. Nature of products and services The Company's microprocessors, chipsets, graphic processor units (GPUs), professional graphics products, server and embedded processors, and System-on-Chip (SoC) products may be sold as standard non-custom products, or custom products manufactured to customers’ specifications. Non-custom products: The Company transfers control and recognizes revenue when non-custom products are shipped to customers, which includes original equipment manufacturers (OEM) and distributors, in accordance with the shipping terms of the sale. Certain OEMs may be entitled to rights of return and rebates under OEM agreements. The Company also sells to distributors under terms allowing the majority of distributors certain rights of return and price protection on unsold merchandise held by them. The Company estimates the amount of variable consideration under OEM and distributor arrangements and, accordingly, records a provision for product returns, allowances for price protection and rebates based on actual historical experience and any known events. The Company offers incentive programs to certain customers, including cooperative advertising, marketing promotions, volume based incentives and special pricing arrangements. Where funds provided for such programs can be estimated, the Company recognizes a reduction to revenue at the time the related revenue is recognized; otherwise, the Company recognizes such reduction to revenue at the later of when; i) the related revenue transaction occurs; or ii) the program is offered. For transactions where the Company reimburses a customer for a portion of the customer’s cost to perform specific product advertising or marketing and promotional activities, such amounts are recognized as a reduction to revenue unless they qualify for expense recognition. Custom products: Custom products which are associated with the Company’s Enterprise, Embedded, and Semi-Custom segment (semi-custom products), under non-cancellable purchases orders and have no alternative use to the Company at contract inception, are recognized as revenue, based on the value of the semi-custom products and expected margin, over the time of production of the products by the Company. Sale of semi-custom products are not subject to a right of return. Development and intellectual property licensing agreements: From time to time, the Company may enter into arrangements with customers that combine the provision of development services and a license to the right to use the intellectual property (IP), which is deemed to be a single performance obligation. Accordingly, the Company recognizes revenue for the entire consideration of the arrangement upon transfer of control of the IP license to the customer. Customers are generally required to pay for products and services within the Company’s standard contractual terms, which are typically net 30 to 60 days. The Company has determined that it does not have significant financing components in its contracts with customers. Refer to Note 3 Supplemental Balance Sheet Information, for further information regarding unearned revenue. |
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Recently Adopted and Issued Accounting Standards | Recently Adopted Accounting Standards Revenue from Contracts with Customers. In May 2014, the Financial Accounting Standards Board (FASB) issued ASU 2014-09, Revenue from Contracts with Customers (ASC 606), which creates a single source of revenue guidance under U.S. GAAP for all companies in all industries and replaces most existing revenue recognition guidance in U.S. GAAP. Under the new standard, revenue is recognized when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration which the entity expects to receive in exchange for those goods or services. In addition, the new standard requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The FASB has issued several amendments to the new standard, including clarification on accounting for licenses of intellectual property and identifying performance obligations. The Company adopted the new standard in the first quarter of 2018, using the full retrospective method, which required the Company to adjust prior reporting periods presented. The Company implemented internal controls and key system functionality to enable the preparation of financial information on adoption. The most significant impacts of the adoption of ASC 606 to the Company related to: (1) the acceleration of revenue recognition for sales of semi-custom products subject to a non-cancellable customer purchase order, (2) the acceleration of revenue recognition for sales to distributors, and (3) the timing and financial statement classification of certain development and intellectual property licensing agreements. Revenue from sales of semi-custom products under non-cancellable purchases orders and that have no alternative use to the Company at contract inception, is recognized, based on the value of the semi-custom products and expected margin, over the time of production of the semi-custom products by the Company, rather than upon shipment. Revenue from sales to the Company's distributors is recognized upon shipment of the product to the distributors (sell-in), net of provision for estimated reserves, instead of the previous revenue recognition which was upon the reported resale of the product by the distributors to their customers (sell-through). For a development and IP licensing agreement executed in 2017, the Company recognized IP-related revenue in the third quarter of 2018 for the entire consideration upon the completion of all the technology milestones. Previously, the agreement resulted in the reduction to research and development expenses in 2017 for development work as the expenses were incurred and would have resulted in licensing revenue to be recognized in periods beyond 2017 upon completion of the deliverables, based on a fair value allocation of the consideration received. Revenue recognition related to the Company’s other revenue streams remain substantially unchanged. The adoption of ASC 606 had an impact on the Company’s Consolidated Statements of Operations and Consolidated Balance Sheets, but had no impact on cash provided by or used in operating, financing, or investing activities on the Consolidated Statements of Cash Flows. The impact on the Company’s previously reported Consolidated Statement of Operations as a result of the adoption of the new standard was as follows:
The impact on the Company’s previously reported Consolidated Balance Sheets line items affected by the adoption of the new standard was as follows:
Income Taxes. In March 2018, the FASB issued ASU 2018-05, Income Taxes (ASC 740), Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118 (SEC Update) (ASU 2018-05). The ASU 2018-05 includes certain provisions of the Securities and Exchange Commission (SEC) paragraphs pursuant to the issuance of the December 2017 SEC Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (SAB 118), which was effective immediately. The SEC issued SAB 118 to address concerns about reporting entities’ ability to timely comply with the accounting requirements to recognize all of the effects of the Tax Cuts and Jobs Act of 2017 (the Tax Reform Act) in the period of enactment. SAB 118 allows disclosure that timely determination of some or all of the income tax effects from the Tax Reform Act are incomplete by the due date of the financial statements and if possible to provide a reasonable estimate. The Company has accounted for the tax effects of the Tax Reform Act under the guidance of SAB 118, on a provisional basis. During the nine months ended September 29, 2018, the Company did not recognize any adjustment to the provisional amounts recorded as of December 30, 2017. The Company will continue to assess the Tax Reform Act’s impact for the rest of 2018, including its interpretation by regulatory authorities and the courts, and will adjust its disclosures and financial presentation as necessary. Stock Compensation. In May 2017, the FASB issued ASU 2017-09, Compensation—Stock Compensation (ASC 718): Scope of Modification Accounting (ASU 2017-09) to provide clarity and reduce both the (1) diversity in practice and (2) cost and complexity when changing the terms or conditions of share-based payment awards. Under ASU 2017-09, modification accounting is required to be applied unless all of the following criteria are the same immediately before and after the change: 1. The award’s fair value (or calculated value or intrinsic value, if those measurement methods are used); 2. The award’s vesting conditions; and 3. The award’s classification as an equity or liability instrument. ASU 2017-09 is effective for annual and interim periods beginning after December 15, 2017 on a prospective basis, and early adoption is permitted. The Company adopted this guidance in the first quarter of 2018 and the guidance did not have an impact on its consolidated financial statements. Statement of Cash Flows. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (ASC 230): Classification of Certain Cash Receipts and Cash Payments (ASU 2016-15), which is intended to reduce the existing diversity in practice in how certain cash receipts and cash payments are classified in the statement of cash flows. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows, Restricted Cash (ASU 2016-18), which requires the inclusion of restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. ASU 2016-15 and ASU 2016-18 are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years, provided that all of the amendments are adopted in the same period. The amendments will be applied using a retrospective transition method to each period presented. The Company adopted this guidance in the first quarter of 2018, which resulted in the additional presentation of restricted cash on the statement of cash flows for each period presented and had no material impact on its consolidated financial statements. Financial Instruments. In January 2016, the FASB issued ASU 2016-01, Financial Instruments—Overall (ASC 825): Recognition and Measurement of Financial Assets and Financial Liabilities (ASU 2016-01), which requires that most equity investments be measured at fair value, with subsequent changes in fair value recognized in net income. The ASU also impacts financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. Entities have to assess the realizability of such deferred tax assets in combination with the entities’ other deferred tax assets. ASU 2016-01 is effective for fiscal years beginning after December 15, 2017 and for interim periods within those fiscal years. The Company adopted this guidance in the first quarter of 2018. For its equity securities that have readily determinable fair values, the Company recorded $2 million of a cumulative effect adjustment to retained earnings upon adoption. For its equity investments that do not have readily determinable fair values, the Company adopted the measurement alternative prospectively with no material impact on its consolidated financial statements. Recently Issued Accounting Standards Intangibles. In August 2018, the FASB issued ASU 2018-15, Intangibles—Goodwill and Other—Internal-Use Software (ASC 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, which requires hosting arrangements that are service contracts to follow the guidance for internal-use software to determine which implementation costs can be capitalized. ASU 2018-15 is effective either prospectively or retrospectively for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years, with early adoption permitted. The Company is currently evaluating how to apply the new guidance. Reporting Comprehensive Income. In February 2018, the FASB issued ASU 2018-02, Income Statement—Reporting Comprehensive Income (ASC 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (AOCI), which gives entities the option to reclassify to retained earnings the tax effects resulting from the Tax Reform Act related to items in AOCI that the FASB refers to as having been stranded in AOCI. The new guidance may be applied retrospectively to each period in which the effect of the Tax Reform Act is recognized in the period of adoption. The Company must adopt this guidance for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted for periods for which financial statements have not yet been issued or made available for issuance, including the period the Tax Reform Act was enacted. The guidance, when adopted, will require new disclosures regarding a company’s accounting policy for releasing the tax effects in AOCI and permit the company the option to reclassify to retained earnings the tax effects resulting from the Tax Reform Act that are stranded in AOCI. The Company is currently evaluating how to apply the new guidance. Leases. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations for lease recognition and disclosure. ASU 2016-02 requires lessees to recognize lease assets and lease liabilities on the balance sheet, while recognizing expenses on the income statements in a manner similar to current guidance. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. The Company did not elect to early adopt this standard and therefore the standard will be effective for the Company in the first quarter of 2019. ASU 2016-02 requires that leases be recognized and measured as of the earliest period presented, using a modified retrospective approach, with all periods presented being adjusted and presented under the new standard. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provides companies an optional adoption method to ASU 2016-02 whereby a company does not have to adjust comparative period financial statements for the new standard. The Company plans to adopt the new standard using the optional adoption method and thereby not adjust comparative financial statements. The Company is currently evaluating the application of the new guidance and currently believes the most significant impact upon adoption will be the recognition of right-of-use assets and lease liabilities on the Company's consolidated balance sheets for its operating leases. The Company is progressing on implementing processes to comply with the guidance. There were no other significant updates to the recently issued accounting standards as disclosed in the Company’s Form 10-K for fiscal year 2017. Although there are several other new accounting pronouncements issued or proposed by the FASB, the Company does not believe any of these accounting pronouncements has had or will have a material impact on its consolidated financial position or operating results. |
Basis of Presentation and Significant Accounting Policies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | The impact on the Company’s previously reported Consolidated Statement of Operations as a result of the adoption of the new standard was as follows:
The impact on the Company’s previously reported Consolidated Balance Sheets line items affected by the adoption of the new standard was as follows:
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Supplemental Balance Sheet Information (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance Sheet Related Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventories, Net | Inventories, net
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Property and Equipment, Net | Property and Equipment, net
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Other Assets | Other Assets
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Accrued Liabilities | Accrued Liabilities
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Other Current Liabilities | Other Current Liabilities
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Changes in Unearned Revenue | Changes in unearned revenue were as follows:
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Debt and Secured Revolving Line of Credit (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Convertible Debt | The following table sets forth total interest expense recognized related to the 2.125% Notes:
The 2.125% Notes consisted of the following:
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Earnings (Loss) Per Share (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Basic and Diluted Earnings (Loss) Per Share | The following table sets forth the components of basic and diluted earnings (loss) per share:
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Financial Instruments (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cash, Cash Equivalents, and Marketable Securities | Cash and financial instruments measured and recorded at fair value as of September 29, 2018 and December 30, 2017 are summarized below:
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Financial Instruments Not Recorded at Fair Value on a Recurring Basis | The carrying amounts and estimated fair values of financial instruments not recorded at fair value are as follows:
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Schedule of Derivative Instruments, Gains (Losses) in Statement of Operations | The following table shows the amount of gains (losses) included in accumulated other comprehensive income (loss), the amount of gains (losses) reclassified from accumulated other comprehensive income (loss) and included in earnings related to foreign currency forward contracts designated as cash flow hedges and the amount of gains (losses) included in other income (expense), net, related to contracts not designated as hedging instruments which was allocated in the consolidated statements of operations:
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Schedule of Fair Value Amounts of Foreign Currency Forward Contracts in Balance Sheet | The following table shows the fair value amounts included in Other current assets should the foreign currency forward contracts be in a gain position or included in Other current liabilities should these contracts be in a loss position. These amounts were recorded in the Company’s condensed consolidated balance sheets as follows:
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Segment Reporting (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Net Revenue and Operating Income (Loss) by Segment | The following table provides a summary of net revenue and operating income by segment:
(1) All Other operating loss is related to stock-based compensation expense for the three and nine months ended September 29, 2018 and September 30, 2017. |
Commitments and Contingencies (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 29, 2018 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Changes in Estimated Liability for Product Warranty | Changes in the Company’s estimated liability for product warranty were as follows:
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Accumulated Other Comprehensive Income (Loss) (Tables) |
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The tables below summarize the changes in accumulated other comprehensive income (loss) by component:
|
Basis of Presentation and Significant Accounting Policies (Details) $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 29, 2018
segment
|
Dec. 30, 2017
USD ($)
|
|
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Number of reportable segments | segment | 2 | |
Retained Earnings | Accounting Standards Update 2016-01 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Cumulative effect adjustment | $ | $ 2 | |
Minimum | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Distributor payment due, standard contractual term | 30 days | |
Maximum | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Distributor payment due, standard contractual term | 60 days |
Basis of Presentation and Significant Accounting Policies - Impact on Statement of Operations (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
||||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||||||
Net revenue | $ 1,584 | $ 3,913 | |||||||||||||
Cost of sales | [1] | $ 992 | 1,013 | $ 3,146 | 2,578 | ||||||||||
Gross margin | [1] | 661 | 571 | 1,910 | 1,335 | ||||||||||
Research and development | [1] | 363 | 320 | 1,063 | 876 | ||||||||||
Marketing, general and administrative | [1] | 148 | 132 | 424 | 382 | ||||||||||
Licensing gain | [1] | 0 | 0 | 0 | (52) | ||||||||||
Operating income | [1] | 150 | 119 | 423 | 129 | ||||||||||
Interest expense | [1] | (30) | (31) | (92) | (95) | ||||||||||
Other income (expense), net | [1] | (6) | (3) | (4) | (11) | ||||||||||
Income before equity loss and income taxes | [1] | 114 | 85 | 327 | 23 | ||||||||||
Provision for income taxes | [1] | 12 | 22 | 26 | 30 | ||||||||||
Equity loss in investee | [1] | 0 | (2) | (2) | (7) | ||||||||||
Net income (loss) | [1],[2] | $ 102 | $ 61 | $ 299 | [3],[4] | $ (14) | [3],[4] | ||||||||
Earnings (loss) per share | |||||||||||||||
Basic (in usd per share) | [1] | $ 0.10 | $ 0.06 | $ 0.31 | $ (0.01) | ||||||||||
Diluted (in usd per share) | [1] | $ 0.09 | $ 0.06 | $ 0.28 | $ (0.01) | ||||||||||
Shares used in per share calculation | |||||||||||||||
Basic (in shares) | [1] | 987 | 957 | 976 | 947 | ||||||||||
Diluted (in shares) | [1] | 1,076 | 1,042 | 1,058 | 947 | ||||||||||
As Previously Reported | |||||||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||||||
Net revenue | $ 1,643 | $ 3,849 | |||||||||||||
Cost of sales | 1,070 | 2,541 | |||||||||||||
Gross margin | 573 | 1,308 | |||||||||||||
Research and development | 315 | 860 | |||||||||||||
Marketing, general and administrative | 132 | 378 | |||||||||||||
Licensing gain | 0 | (52) | |||||||||||||
Operating income | 126 | 122 | |||||||||||||
Interest expense | (31) | (95) | |||||||||||||
Other income (expense), net | (3) | (11) | |||||||||||||
Income before equity loss and income taxes | 92 | 16 | |||||||||||||
Provision for income taxes | 19 | 27 | |||||||||||||
Equity loss in investee | (2) | (7) | |||||||||||||
Net income (loss) | $ 71 | $ (18) | |||||||||||||
Earnings (loss) per share | |||||||||||||||
Basic (in usd per share) | $ 0.07 | $ (0.02) | |||||||||||||
Diluted (in usd per share) | $ 0.07 | $ (0.02) | |||||||||||||
Shares used in per share calculation | |||||||||||||||
Basic (in shares) | 957 | 947 | |||||||||||||
Diluted (in shares) | 1,042 | 947 | |||||||||||||
Accounting Standards Update 2014-09 | Adjustment | |||||||||||||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||||||||||||
Net revenue | $ (59) | $ 64 | |||||||||||||
Cost of sales | (57) | 37 | |||||||||||||
Gross margin | (2) | 27 | |||||||||||||
Research and development | 5 | 16 | |||||||||||||
Marketing, general and administrative | 0 | 4 | |||||||||||||
Licensing gain | 0 | 0 | |||||||||||||
Operating income | (7) | 7 | |||||||||||||
Interest expense | 0 | 0 | |||||||||||||
Other income (expense), net | 0 | 0 | |||||||||||||
Income before equity loss and income taxes | (7) | 7 | |||||||||||||
Provision for income taxes | 3 | 3 | |||||||||||||
Equity loss in investee | 0 | 0 | |||||||||||||
Net income (loss) | $ (10) | $ 4 | |||||||||||||
Earnings (loss) per share | |||||||||||||||
Basic (in usd per share) | $ (0.01) | $ 0.01 | |||||||||||||
Diluted (in usd per share) | $ (0.01) | $ 0.01 | |||||||||||||
|
Basis of Presentation and Significant Accounting Policies - Impact on Balance Sheet (Details) - USD ($) $ in Millions |
Sep. 29, 2018 |
Dec. 30, 2017 |
|||
---|---|---|---|---|---|
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Accounts receivable, net | [1] | $ 1,207 | $ 454 | ||
Inventories, net | [1] | 738 | 694 | ||
Other current assets | [1] | 200 | 191 | ||
Accrued liabilities | [1] | 688 | 555 | ||
Other current liabilities | [1] | 13 | 92 | ||
Deferred income on shipments to distributors | 0 | ||||
Accumulated deficit | [1] | $ (7,474) | (7,775) | ||
As Previously Reported | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Accounts receivable, net | 400 | ||||
Inventories, net | 739 | ||||
Other current assets | 188 | ||||
Accrued liabilities | 541 | ||||
Other current liabilities | 57 | ||||
Deferred income on shipments to distributors | 22 | ||||
Accumulated deficit | (7,760) | ||||
Accounting Standards Update 2014-09 | Adjustment | |||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||||
Accounts receivable, net | 54 | ||||
Inventories, net | (45) | ||||
Other current assets | 3 | ||||
Accrued liabilities | 14 | ||||
Other current liabilities | 35 | ||||
Deferred income on shipments to distributors | (22) | ||||
Accumulated deficit | $ (15) | ||||
|
GLOBALFOUNDRIES (Details) - USD ($) $ / shares in Units, $ in Millions |
3 Months Ended | 9 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Aug. 30, 2016 |
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
Dec. 30, 2017 |
||||
Related Party Transaction [Line Items] | |||||||||
Payables to related parties | [1] | $ 533 | $ 533 | $ 412 | |||||
Prepayment and receivables—related parties | [1] | 53 | 53 | 33 | |||||
Related Party | WCH | WCH Warrant | |||||||||
Related Party Transaction [Line Items] | |||||||||
Number of securities called by warrants (in shares) | 75,000,000 | ||||||||
Exercise price of warrants (in usd per share) | $ 5.98 | ||||||||
Related Party | GF | |||||||||
Related Party Transaction [Line Items] | |||||||||
Payables to related parties | 321 | 321 | 241 | ||||||
Purchases from related party | 377 | $ 331 | 1,200 | $ 773 | |||||
Prepayment and receivables—related parties | $ 15 | $ 15 | 27 | ||||||
Related Party | GF | Limited waiver | |||||||||
Related Party Transaction [Line Items] | |||||||||
Payables to related parties | $ 100 | ||||||||
Related party transaction payments to date | $ 100 | ||||||||
Related Party | GF | Wafers | |||||||||
Related Party Transaction [Line Items] | |||||||||
Long-term purchase commitment, period | 5 years | ||||||||
Related Party | Mubadala | WCH Warrant | |||||||||
Related Party Transaction [Line Items] | |||||||||
Maximum allowed percent of capital stock owned | 19.99% | ||||||||
|
Supplemental Balance Sheet Information (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
Dec. 30, 2017 |
||||
Accounts Receivable, Net | ||||||||
Unbilled accounts receivables | $ 331 | $ 331 | $ 75 | |||||
Inventories, Net | ||||||||
Raw materials | 85 | 85 | 34 | |||||
Work in process | 418 | 418 | 446 | |||||
Finished goods | 235 | 235 | 214 | |||||
Total inventories, net | [1] | 738 | 738 | 694 | ||||
Property and Equipment, Net | ||||||||
Leasehold improvements | 176 | 176 | 187 | |||||
Equipment | 780 | 780 | 758 | |||||
Construction in progress | 80 | 80 | 56 | |||||
Property and equipment, gross | 1,036 | 1,036 | 1,001 | |||||
Accumulated depreciation | (718) | (718) | (740) | |||||
Total property and equipment, net | [1] | 318 | 318 | 261 | ||||
Other Assets | ||||||||
Software technology and licenses, net | 274 | 274 | 239 | |||||
Other | 94 | 94 | 71 | |||||
Total other assets | [1] | 368 | 368 | 310 | ||||
Accrued Liabilities | ||||||||
Accrued compensation and benefits | 223 | 223 | 206 | |||||
Marketing programs and advertising expenses | 249 | 249 | 145 | |||||
Software technology and licenses payable | 45 | 45 | 41 | |||||
Other | 171 | 171 | 163 | |||||
Total accrued liabilities | [1] | 688 | 688 | 555 | ||||
Other Current Liabilities | ||||||||
Unearned revenue | 3 | 3 | 85 | |||||
Other | 10 | 10 | 7 | |||||
Total other current liabilities | [1] | 13 | 13 | $ 92 | ||||
Changes in Unearned Revenue | ||||||||
Beginning balance | 67 | $ 43 | 85 | $ 22 | ||||
Unearned revenue | 37 | 32 | 124 | 59 | ||||
Revenue recognized during the period | (86) | 0 | (186) | (6) | ||||
Other | (15) | 0 | (20) | 0 | ||||
Ending balance | $ 3 | $ 75 | $ 3 | $ 75 | ||||
|
Supplemental Balance Sheet Information - Remaining Performance Obligations (Details) $ in Millions |
Sep. 29, 2018
USD ($)
|
---|---|
Balance Sheet Related Disclosures [Abstract] | |
Revenue allocated to remaining performance obligations that are unsatisfied or partially unsatisfied | $ 121 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2018-09-30 | |
Balance Sheet Related Disclosures [Abstract] | |
Revenue allocated to remaining performance obligations that are unsatisfied or partially unsatisfied | $ 99 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Performance obligations expected to be satisfied, expected timing | 1 year |
Equity Interest Purchase Agreement - ATMP Joint Venture (Details) |
3 Months Ended | 9 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018
USD ($)
|
Sep. 30, 2017
USD ($)
|
Sep. 29, 2018
USD ($)
|
Sep. 30, 2017
USD ($)
|
Dec. 30, 2017
USD ($)
|
Apr. 30, 2016
joint_venture
|
||||||
Investment [Line Items] | |||||||||||
Number of joint ventures | joint_venture | 2 | ||||||||||
Carrying value of investment | [1] | $ 58,000,000 | $ 58,000,000 | $ 58,000,000 | |||||||
Payables to related parties | [1] | 533,000,000 | 533,000,000 | 412,000,000 | |||||||
Receivables from related parties | [1] | 53,000,000 | 53,000,000 | 33,000,000 | |||||||
Equity loss in investee | [2] | 0 | $ 2,000,000 | 2,000,000 | $ 7,000,000 | ||||||
ATMP JV | |||||||||||
Investment [Line Items] | |||||||||||
Carrying value of investment | 58,000,000 | 58,000,000 | 58,000,000 | ||||||||
ATMP JV | Joint Venture | |||||||||||
Investment [Line Items] | |||||||||||
Purchases from related party | 151,000,000 | 131,000,000 | 429,000,000 | 332,000,000 | |||||||
Payables to related parties | 212,000,000 | 212,000,000 | 171,000,000 | ||||||||
Total resales back to related parties | 21,000,000 | 0 | 40,000,000 | 0 | |||||||
Receivables from related parties | 19,000,000 | 19,000,000 | $ 3,000,000 | ||||||||
Equity loss in investee | $ 0 | $ 2,000,000 | $ 2,000,000 | $ 7,000,000 | |||||||
ATMP JV | Joint Venture | Company's Subsidiaries | |||||||||||
Investment [Line Items] | |||||||||||
Ownership percentage | 15.00% | ||||||||||
ATMP JV | Joint Venture | TFME's Affiliates | |||||||||||
Investment [Line Items] | |||||||||||
Ownership percentage | 85.00% | ||||||||||
|
Equity Joint Venture (Details) |
3 Months Ended | 9 Months Ended | |||||||||
---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018
USD ($)
|
Sep. 30, 2017
USD ($)
|
Sep. 29, 2018
USD ($)
|
Sep. 30, 2017
USD ($)
|
Dec. 30, 2017
USD ($)
|
Feb. 29, 2016
USD ($)
legal_entity
|
||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||
Operating income | [1] | $ 0 | $ 0 | $ 0 | $ 52,000,000 | ||||||
Carrying value of investment | [2] | 58,000,000 | 58,000,000 | $ 58,000,000 | |||||||
Prepayment and receivables—related parties | [2] | 53,000,000 | 53,000,000 | 33,000,000 | |||||||
THATIC JV | |||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||
Number of legal entities | legal_entity | 2 | ||||||||||
Carrying value of investment | 0 | 0 | |||||||||
Prepayment and receivables—related parties | 19,000,000 | 19,000,000 | $ 3,000,000 | ||||||||
THATIC JV | Licensing gain | |||||||||||
Schedule of Equity Method Investments [Line Items] | |||||||||||
Estimated license fees expected to be earned over several years pursuant to a licensing agreement | $ 293,000,000 | ||||||||||
Operating income | $ 86,000,000 | $ 0 | $ 86,000,000.000 | $ 52,000,000 | |||||||
|
Debt and Secured Revolving Line of Credit (Narrative) (Details) |
1 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 14, 2015
USD ($)
|
Sep. 30, 2016
USD ($)
day
|
Sep. 29, 2018
USD ($)
$ / shares
|
Sep. 29, 2018
USD ($)
$ / shares
|
Sep. 30, 2017
USD ($)
|
Jun. 29, 2018
$ / shares
|
Dec. 30, 2017
USD ($)
|
Jun. 16, 2014
USD ($)
|
Feb. 26, 2014
USD ($)
|
Aug. 15, 2012
USD ($)
|
||||||
Debt Instrument [Line Items] | |||||||||||||||
Issuance of treasury stock to partially settle debt | [1],[2] | $ 103,000,000 | $ 38,000,000 | ||||||||||||
Gain (Loss) on extinguishment of debt | $ 6,000,000 | 7,000,000 | |||||||||||||
Aggregate principal amount repurchased | [1],[2] | 15,000,000 | $ 70,000,000 | ||||||||||||
Secured Revolving Line of Credit | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Secured revolving line of credit, outstanding balance | $ 70,000,000 | $ 70,000,000 | $ 70,000,000 | ||||||||||||
Secured revolving line of credit, interest rate | 5.50% | 5.50% | 4.75% | ||||||||||||
Letters of credit outstanding, amount | $ 26,000,000 | $ 26,000,000 | |||||||||||||
Secured revolving line of credit, remaining borrowing capacity | 205,000,000 | $ 205,000,000 | |||||||||||||
Repayment period | 90 days | ||||||||||||||
Secured Revolving Line of Credit | Amended and restated loan and security agreement | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Maximum borrowing capacity | $ 500,000,000 | ||||||||||||||
Maximum letters of credit available for issuance | 45,000,000 | ||||||||||||||
Aggregate amount by which size of commitments may be increased (up to) | $ 200,000,000 | ||||||||||||||
Secured Revolving Line of Credit | Amended and restated loan and security agreement | Federal Funds Rate | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 0.50% | ||||||||||||||
Secured Revolving Line of Credit | Amended and restated loan and security agreement | LIBOR | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Basis spread on variable rate | 1.00% | ||||||||||||||
2.125% Convertible Senior Notes due 2026 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate | 2.125% | ||||||||||||||
Principal amount | $ 805,000,000 | $ 805,000,000 | $ 805,000,000 | $ 805,000,000 | |||||||||||
Outstanding aggregate principal amount | $ 805,000,000 | ||||||||||||||
Debt Instrument, Convertible, Conversion Price | $ / shares | $ 8.00 | $ 8.00 | |||||||||||||
Remaining life | 96 months | ||||||||||||||
Share price (in usd per share) | $ / shares | $ 30.89 | ||||||||||||||
If-converted value in excess of principal | $ 2,303,000,000 | ||||||||||||||
Effective interest rate | 8.00% | 8.00% | |||||||||||||
2.125% Convertible Senior Notes due 2026 | Debt Instrument, circumstance 1 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Threshold trading days | day | 20 | ||||||||||||||
Threshold consecutive trading days | day | 30 | ||||||||||||||
Threshold percentage of conversion price | 130.00% | ||||||||||||||
2.125% Convertible Senior Notes due 2026 | Debt Instrument, circumstance 2 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Threshold consecutive trading days | day | 10 | ||||||||||||||
Threshold percentage of conversion price | 98.00% | ||||||||||||||
Conversion period after threshold period days | day | 5 | ||||||||||||||
6.75% Senior Notes due 2019 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate | 6.75% | ||||||||||||||
Repayments of Debt | $ 14,000,000 | ||||||||||||||
Issuance of treasury stock to partially settle debt | $ 87,000,000 | ||||||||||||||
Principal amount | $ 600,000,000 | ||||||||||||||
Outstanding aggregate principal amount | 66,000,000 | 66,000,000 | |||||||||||||
Aggregate principal amount settled | 101,000,000 | ||||||||||||||
7.50% Senior Notes due 2022 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate | 7.50% | ||||||||||||||
Principal amount | $ 500,000,000 | ||||||||||||||
Outstanding aggregate principal amount | 337,000,000 | 337,000,000 | |||||||||||||
Aggregate principal amount settled | 10,000,000 | ||||||||||||||
7.00% Senior Notes due 2024 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate | 7.00% | ||||||||||||||
Principal amount | $ 500,000,000 | ||||||||||||||
Outstanding aggregate principal amount | 310,000,000 | $ 310,000,000 | |||||||||||||
Aggregate principal amount repurchased | $ 1,000,000 | ||||||||||||||
|
Debt and Secured Revolving Line of Credit (Convertible Debt) (Details) - 2.125% Convertible Senior Notes due 2026 - USD ($) |
Sep. 29, 2018 |
Dec. 30, 2017 |
Sep. 30, 2016 |
---|---|---|---|
Debt Instrument [Line Items] | |||
Principal | $ 805,000,000 | $ 805,000,000 | $ 805,000,000 |
Unamortized debt discount | (268,000,000) | (286,000,000) | |
Unamortized debt issuance costs | (11,000,000) | (12,000,000) | |
Net carrying amount | 526,000,000 | 507,000,000 | |
Carrying amount of the equity component, net | $ 305,000,000 | 305,000,000 | |
Equity issuance costs | $ 9,000,000 |
Debt and Secured Revolving Line of Credit (Interest Expense Recognized) (Details) - 2.125% Convertible Senior Notes due 2026 - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
|
Debt Instrument [Line Items] | ||||
Contractual interest expense | $ 5 | $ 4 | $ 13 | $ 13 |
Interest cost related to amortization of debt issuance costs | 0 | 0 | 1 | 1 |
Interest cost related to amortization of the debt discount | $ 6 | $ 6 | $ 18 | $ 17 |
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | |||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
||||||||||||
Numerator – Net income (loss): | |||||||||||||||
Numerator for basic earnings (loss) per share | [1],[2] | $ 102 | $ 61 | $ 299 | [3],[4] | $ (14) | [3],[4] | ||||||||
Denominator - Weighted average shares: | |||||||||||||||
Denominator for basic earnings (loss) per share (in shares) | [1] | 987 | 957 | 976 | 947 | ||||||||||
Effect of potentially dilutive shares: | |||||||||||||||
Employee stock options and restricted stock units (in shares) | 34 | 44 | 35 | 0 | |||||||||||
Warrants (in shares) | 55 | 41 | 47 | 0 | |||||||||||
Denominator for diluted earnings (loss) per share (in shares) | [1] | 1,076 | 1,042 | 1,058 | 947 | ||||||||||
Earnings (loss) per share: | |||||||||||||||
Basic (in usd per share) | [1] | $ 0.10 | $ 0.06 | $ 0.31 | $ (0.01) | ||||||||||
Diluted (in usd per share) | [1] | $ 0.09 | $ 0.06 | $ 0.28 | $ (0.01) | ||||||||||
2.125% Convertible Senior Notes due 2026 | |||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||
Stated interest rate | 2.125% | 2.125% | |||||||||||||
Stock Options, Restricted Stock Units, Conversion of Notes, and Warrants Under Warrant Agreement | |||||||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||||||||||||||
Anti-dilutive shares (in shares) | 103 | 102 | 104 | 193 | |||||||||||
|
Financial Instruments (Cash, Cash Equivalents, and Marketable Securities Fair Value Measurements) (Details) - USD ($) $ in Millions |
Sep. 29, 2018 |
Dec. 30, 2017 |
||
---|---|---|---|---|
Schedule of Investments [Line Items] | ||||
Total Fair Value | $ 1,056 | $ 1,185 | ||
Cash and Cash Equivalents | 1,046 | 1,185 | ||
Short-Term Marketable Securities | [1] | 10 | 0 | |
Level 1 | ||||
Schedule of Investments [Line Items] | ||||
Total Fair Value | 205 | 395 | ||
Cash and Cash Equivalents | 205 | 395 | ||
Short-Term Marketable Securities | 0 | |||
Level 2 | ||||
Schedule of Investments [Line Items] | ||||
Total Fair Value | 759 | 682 | ||
Cash and Cash Equivalents | 749 | 682 | ||
Short-Term Marketable Securities | 10 | |||
Cash | ||||
Schedule of Investments [Line Items] | ||||
Total Fair Value | 92 | 108 | ||
Cash and Cash Equivalents | 92 | 108 | ||
Short-Term Marketable Securities | 0 | |||
Government money market funds | Level 1 | ||||
Schedule of Investments [Line Items] | ||||
Total Fair Value | 205 | 395 | ||
Cash and Cash Equivalents | 205 | 395 | ||
Short-Term Marketable Securities | 0 | |||
Commercial paper | Level 2 | ||||
Schedule of Investments [Line Items] | ||||
Total Fair Value | 759 | 682 | ||
Cash and Cash Equivalents | 749 | $ 682 | ||
Short-Term Marketable Securities | $ 10 | |||
|
Financial Instruments (Narrative) (Details) - USD ($) $ in Millions |
9 Months Ended | |
---|---|---|
Sep. 29, 2018 |
Dec. 30, 2017 |
|
Schedule of Investments [Line Items] | ||
Carrying value of cost method investments | $ 3 | $ 3 |
Foreign Currency Forward Contracts | ||
Schedule of Investments [Line Items] | ||
Contract maturity period | 12 months | |
Maximum length of time hedged in foreign currency cash flow hedges | 12 months | |
Cash Flow Hedging | Foreign Currency Forward Contracts | ||
Schedule of Investments [Line Items] | ||
Derivative, notional amount | $ 326 | 300 |
Level 1 | Government money market funds | ||
Schedule of Investments [Line Items] | ||
Investment in money market fund and bank guarantee | 5 | 2 |
Level 1 | Mutual funds | ||
Schedule of Investments [Line Items] | ||
Restricted investments | $ 22 | $ 18 |
Financial Instruments (Schedule of Carrying Amounts and Estimated Fair Values of Financial Instruments not Recorded at Fair Value) (Details) - USD ($) $ in Millions |
Sep. 29, 2018 |
Dec. 30, 2017 |
---|---|---|
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Unamortized debt issuance costs | $ 17 | $ 19 |
2.125% Convertible Senior Notes due 2026 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Stated interest rate | 2.125% | |
Unamortized debt discount | $ 268 | 286 |
Carrying Amount | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term debt | 136 | 70 |
Long-term debt, net | 1,167 | 1,324 |
Estimated Fair Value | Level 2 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Short-term debt | 137 | 70 |
Long-term debt, net | $ 3,830 | $ 2,103 |
Financial Instruments (Gain (Loss) from Hedging Transactions) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
|||
Foreign Currency Forward Contracts - gains (losses) | ||||||
Other comprehensive income (loss) | [1] | $ 0 | $ 2 | $ (16) | $ 7 | |
Foreign Currency Forward Contracts | Contracts designated as hedging instruments | Cash Flow Hedging | ||||||
Foreign Currency Forward Contracts - gains (losses) | ||||||
Other comprehensive income (loss) | 0 | 1 | (16) | 8 | ||
Foreign Currency Forward Contracts | Contracts designated as hedging instruments | Cash Flow Hedging | Research and development | ||||||
Foreign Currency Forward Contracts - gains (losses) | ||||||
(Gain) loss reclassified from accumulated OCI into income | (4) | 3 | 0 | 4 | ||
Foreign Currency Forward Contracts | Contracts designated as hedging instruments | Cash Flow Hedging | Marketing, general and administrative | ||||||
Foreign Currency Forward Contracts - gains (losses) | ||||||
(Gain) loss reclassified from accumulated OCI into income | (1) | 1 | 0 | 1 | ||
Foreign Currency Forward Contracts | Contracts not designated as hedging instruments | Other income (expense), net | ||||||
Foreign Currency Forward Contracts - gains (losses) | ||||||
Other income (expense), net | $ 0 | $ (2) | $ (2) | $ (3) | ||
|
Financial Instruments (Summary of Derivative Instruments) (Details) - USD ($) $ in Millions |
Sep. 29, 2018 |
Dec. 30, 2017 |
---|---|---|
Level 2 | Cash Flow Hedging | Foreign Currency Forward Contracts | ||
Foreign Currency Forward Contracts - gains (losses) | ||
Contracts designated as cash flow hedging instruments | $ (10) | $ 7 |
Income Taxes (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | ||||
---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
|||
Income Tax Disclosure [Abstract] | ||||||
Income tax provision | [1] | $ 12 | $ 22 | $ 26 | $ 30 | |
Federal base erosion and anti-abuse tax | 5 | 15 | ||||
Foreign taxes in profitable locations | 4 | |||||
Withholding taxes applicable to license fee revenue from foreign locations | 7 | 7 | ||||
Gross unrecognized tax benefits | $ 51 | $ 51 | ||||
|
Segment Reporting (Net Revenue and Operating Income (Loss) by Segment) (Details) $ in Millions |
3 Months Ended | 9 Months Ended | |||||
---|---|---|---|---|---|---|---|
Sep. 29, 2018
USD ($)
|
Sep. 30, 2017
USD ($)
|
Sep. 29, 2018
USD ($)
segment
|
Sep. 30, 2017
USD ($)
|
||||
Segment Reporting [Abstract] | |||||||
Number of reportable segments | segment | 2 | ||||||
Segment Reporting Information [Line Items] | |||||||
Total net revenue | [1] | $ 1,653 | $ 1,584 | $ 5,056 | $ 3,913 | ||
Total operating income | [1] | 150 | 119 | 423 | 129 | ||
Operating Segments | Computing and Graphics | |||||||
Segment Reporting Information [Line Items] | |||||||
Total net revenue | 938 | 835 | 3,139 | 2,069 | |||
Total operating income | 100 | 73 | 355 | 59 | |||
Operating Segments | Enterprise, Embedded and Semi-Custom | |||||||
Segment Reporting Information [Line Items] | |||||||
Total net revenue | 715 | 749 | 1,917 | 1,844 | |||
Total operating income | 86 | 74 | 169 | 145 | |||
All Other | |||||||
Segment Reporting Information [Line Items] | |||||||
Total operating income | $ (36) | $ (28) | $ (101) | $ (75) | |||
|
Stock-Based Incentive Compensation Plans (Narrative) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
|
Employee Stock Option [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 1.0 | 0.9 | 1.1 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value | $ 8.08 | $ 5.46 | $ 7.62 | |
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock units, shares granted (in shares) | 8.8 | 8.3 | 12.0 | 10.4 |
Restricted stock units, shares granted, weighted average grant date fair value (in usd per share) | $ 19.81 | $ 13.24 | $ 17.83 | $ 13.03 |
ESPP | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Shares of common stock purchased under ESPP (in shares) | 2.2 | |||
Purchase price of common stock purchased under ESPP (in usd per share) | $ 9.57 | 9.57 | ||
Cash proceeds from purchases under ESPP | $ 21 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ 3.42 | $ 3.42 | ||
Performance Shares [Member] | 2017 PRSU Grants [Member] | 100% payout level [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock units, shares granted (in shares) | 0.8 | |||
Restricted stock units, shares granted, weighted average grant date fair value (in usd per share) | $ 17.18 | |||
Performance Shares [Member] | 2018 PRSU Grants [Member] | 100% payout level [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Restricted stock units, shares granted (in shares) | 0.8 | 1.0 | ||
Restricted stock units, shares granted, weighted average grant date fair value (in usd per share) | $ 23.97 | $ 21.67 |
Commitments and Contingencies (Details) $ in Millions |
3 Months Ended | 5 Months Ended | 9 Months Ended | |||
---|---|---|---|---|---|---|
Sep. 29, 2018
USD ($)
|
Sep. 30, 2017
USD ($)
|
Jun. 30, 2018
USD ($)
claim
state
|
Sep. 29, 2018
USD ($)
|
Sep. 30, 2017
USD ($)
|
Jun. 14, 2018
claim
|
|
Commitments and Contingencies Disclosure [Abstract] | ||||||
Product warranty period | 1 year | |||||
Limited product warranty period | 3 years | |||||
Changes in Product Warranty Liability [Roll Forward] | ||||||
Beginning balance | $ 12 | $ 10 | $ 12 | $ 12 | ||
New warranties issued | 7 | 7 | 20 | 18 | ||
Settlements | (7) | (7) | (21) | (16) | ||
Changes in liability for pre-existing warranties, including expirations | 0 | 1 | 1 | (3) | ||
Ending balance | $ 12 | $ 11 | $ 12 | $ 12 | $ 11 | |
Hauck et al. Litigation | ||||||
Loss Contingencies [Line Items] | ||||||
Number of putative class action complaints filed | claim | 3 | |||||
Number of state in which the plaintiff seeks damages | state | 4 | |||||
In re Advanced Micro Devices, Inc. Shareholder Derivative Lawsuit | ||||||
Loss Contingencies [Line Items] | ||||||
Number of claims | claim | 2 |
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions |
3 Months Ended | 9 Months Ended | |||||||
---|---|---|---|---|---|---|---|---|---|
Sep. 29, 2018 |
Sep. 30, 2017 |
Sep. 29, 2018 |
Sep. 30, 2017 |
||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||
Beginning balance | [1] | $ 596 | |||||||
Unrealized gains (losses) arising during the period | $ (5) | $ 6 | (16) | $ 14 | |||||
Reclassification adjustment for (gains) losses realized and included in net income (loss) | 5 | (4) | 0 | (5) | |||||
Tax effect | 0 | 0 | 0 | (2) | |||||
Total other comprehensive income (loss) | [2] | 0 | 2 | (16) | 7 | ||||
Ending balance | [1] | 1,125 | 1,125 | ||||||
Unrealized gains (losses) on available-for-sale securities | |||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||
Beginning balance | 0 | (1) | 0 | (1) | |||||
Unrealized gains (losses) arising during the period | 0 | 0 | 0 | 0 | |||||
Reclassification adjustment for (gains) losses realized and included in net income (loss) | 0 | 0 | 0 | 0 | |||||
Tax effect | 0 | 0 | 0 | 0 | |||||
Total other comprehensive income (loss) | 0 | 0 | 0 | 0 | |||||
Ending balance | 0 | (1) | 0 | (1) | |||||
Unrealized gains (losses) on cash flow hedges | |||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||
Beginning balance | (10) | 1 | 6 | (4) | |||||
Unrealized gains (losses) arising during the period | (5) | 6 | (16) | 14 | |||||
Reclassification adjustment for (gains) losses realized and included in net income (loss) | 5 | (4) | 0 | (5) | |||||
Tax effect | 0 | 0 | 0 | (2) | |||||
Total other comprehensive income (loss) | 0 | 2 | (16) | 7 | |||||
Ending balance | (10) | 3 | (10) | 3 | |||||
Total | |||||||||
Changes in Accumulated Other Comprehensive Income (Loss) [Roll Forward] | |||||||||
Beginning balance | (10) | 0 | 6 | (5) | |||||
Ending balance | $ (10) | $ 2 | $ (10) | $ 2 | |||||
|
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