Discontinued Operations

9 Months Ended

Oct. 02, 2011

Discontinued Operations [Abstract]

Discontinued Operations

Note 15 — Discontinued Operations

On May 6, 2011, the Company completed the sale of substantially all of its external storage systems business to NetApp pursuant to the terms of the asset purchase agreement and received cash consideration of $480.0 million. The strategic decision to divest the external storage systems business was based on the Company’s expectation that long-term shareholder value can be maximized by becoming a pure-play semiconductor company. Under the terms of the agreement, NetApp purchased substantially all the assets of the Company’s external storage systems business, which developed and delivered external storage systems products and technology to a wide range of partners that provide storage solutions to end customers. As part of the asset purchase agreement, certain transitional services are provided to NetApp for a period of up to eighteen months. The purpose of these services is to provide short-term assistance to the buyer in assuming the operations of the external storage systems business.

Following is selected financial information included in (loss)/income from discontinued operations:

	Three Months Ended					Nine Months Ended
	October 2, 2011			October 3, 2010		October 2, 2011			October 3, 2010
	(In thousands)
Revenues	$	2,860		$	176,106	$	210,225		$	506,574
(Loss)/income before income taxes	$	(2,366	)	$	16,246	$	(24,866	)	$	35,659
Gain on sale of external storage systems business		—			—		260,066			—
(Benefit from)/provision for income taxes		(55	)		5,644		(19,473	)		12,135
(Loss)/income from discontinued operations	$	(2,311	)	$	10,602	$	254,673		$	23,524

During the three and nine months ended October 2, 2011, the Company recorded write-downs of $2.6 million and $23.0 million, respectively, related to assets associated with discontinued operations. Further, the Company released $19.7 million of deferred tax liabilities related to tax deductible goodwill in connection with the sale of the external storage systems business during the nine months ended October 2, 2011.