Intangible Assets, Goodwill and Other

3 Months Ended

Apr. 01, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure

Acquisition-related Intangible Assets and Goodwill

Xilinx Acquisition

On February 14, 2022, the Company completed the acquisition of Xilinx, Inc. (Xilinx), a leading provider of adaptive computing solutions, for a total purchase consideration of $48.8 billion. The acquisition of Xilinx expands the Company’s product portfolio, which now includes FPGAs, Adaptive SoC products and ACAP products. The Company allocated the purchase price to $27.3 billion of identified intangible assets and $1.3 billion of net liabilities, with the excess purchase price of $22.8 billion recorded as goodwill.

Pensando Acquisition

On May 26, 2022, the Company completed the acquisition of Pensando Systems, Inc. (Pensando), a leader in next-generation distributed computing, for a total purchase consideration of $1.7 billion. The acquisition of Pensando and its leading distributed services platform expands the Company’s ability to offer leadership solutions for cloud, enterprise, and edge customers. The Company allocated the purchase price to $349 million of identified intangible assets and $208 million of other net assets, with the excess purchase price of $1.1 billion recorded as goodwill.

Acquisition-related Intangible Assets

Acquisition-related intangibles were as follows:

	April 1, 2023						December 31, 2022
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(In millions)						(In millions)
Developed technology	$	12,360	$	(948)	$	11,412	$	12,360	$	(738)	$	11,622
Customer relationships	12,324		(2,464)		9,860		12,324		(1,973)		10,351
Customer backlog	809		(806)		3		809		(712)		97
Corporate trade name	65		(65)		—		65		(57)		8
Product trademarks	914		(88)		826		914		(68)		846
Identified intangible assets subject to amortization	26,472		(4,371)		22,101		26,472		(3,548)		22,924
IPR&D not subject to amortization	1,190		—		1,190		1,194				1,194
Total acquisition-related intangible assets	$	27,662	$	(4,371)	$	23,291	$	27,666	$	(3,548)	$	24,118

Acquisition-related intangible amortization expense was $823 million and $479 million for the three months ended April 1, 2023 and March 26, 2022, respectively.

Based on the carrying value of acquisition-related intangibles recorded as of April 1, 2023, and assuming no subsequent impairment of the underlying assets, the estimated annual amortization expense for acquisition-related intangibles is expected to be as follows:

Fiscal Year	(In millions)
Remainder of 2023	$	1,981
2024	2,286
2025	2,061
2026	1,951
2027	1,844
2028 and thereafter	11,978
Total	$	22,101