Goodwill and Purchased Intangible Assets

12 Months Ended

Jul. 29, 2017

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Purchased Intangible Assets


(a)	Goodwill

The following tables present the goodwill allocated to the Company’s reportable segments as of July 29, 2017 and July 30, 2016, as well as the changes to goodwill during fiscal 2017 and 2016 (in millions):



	Balance at July 30, 2016		Acquisitions		Divestiture		Other		Balance at July 29, 2017
Americas	$	16,529	$	2,042	$	—	$	120	$	18,691
EMEA	6,269		740		—		48		7,057
APJC	3,827		163		—		28		4,018
Total	$	26,625	$	2,945	$	—	$	196	$	29,766



	Balance at July 25, 2015		Acquisitions		Divestiture			Other			Balance at July 30, 2016
Americas	$	15,212	$	1,607	$	(126	)	$	(164	)	$	16,529
EMEA	5,791		554		(12		)	(64		)	6,269
APJC	3,466		401		(3		)	(37		)	3,827
Total	$	24,469	$	2,562	$	(141	)	$	(265	)	$	26,625

“Other” in the tables above primarily consists of foreign currency translation, as well as immaterial purchase accounting adjustments.


(b)	Purchased Intangible Assets

The following tables present details of the Company’s intangible assets acquired through acquisitions completed during fiscal 2017 and 2016 (in millions, except years):



	FINITE LIVES									INDEFINITE LIVES		TOTAL
	TECHNOLOGY			CUSTOMER RELATIONSHIPS			OTHER			IPR&D		TOTAL
Fiscal 2017	Weighted- Average Useful Life (in Years)	Amount		Weighted- Average Useful Life (in Years)	Amount		Weighted- Average Useful Life (in Years)	Amount		Amount		Amount
CloudLock	6.0	$	32	4.0	$	3	1.5	$	1	$	—	$	36
AppDynamics	4.0	525		7.0	235		2.3	25		—		785
MindMeld	4.0	51		1.0	—		0.0	—		—		51
Others (four in total)	3.0	6		0.0	—		0.0	—		—		6
Total		$	614		$	238		$	26	$	—	$	878



	FINITE LIVES									INDEFINITE LIVES		TOTAL
	TECHNOLOGY			CUSTOMER RELATIONSHIPS			OTHER			IPR&D		TOTAL
Fiscal 2016	Weighted- Average Useful Life (in Years)	Amount		Weighted- Average Useful Life (in Years)	Amount		Weighted- Average Useful Life (in Years)	Amount		Amount		Amount
MaintenanceNet	5.0	$	50	5.0	$	2	2.0	$	2	$	11	$	65
OpenDNS	5.0	43		7.0	15		1.0	2		1		61
Lancope	5.0	79		6.0	29		3.0	3		10		121
Acano	5.0	9		5.0	12		0.0	—		82		103
Leaba	0.0	—		0.0	—		0.0	—		96		96
Jasper	6.0	240		7.0	75		2.0	23		23		361
CliQr	6.0	65		6.0	3		2.0	1		—		69
Others (five in total)	4.1	58		6.3	6		0.0	—		—		64
Total		$	544		$	142		$	31	$	223	$	940

The following tables present details of the Company’s purchased intangible assets (in millions):



July 29, 2017	Gross		Accumulated Amortization			Net
Purchased intangible assets with finite lives:
Technology	$	3,182	$	(1,386	)	$	1,796
Customer relationships	1,353		(765		)	588
Other	82		(38		)	44
Total purchased intangible assets with finite lives	4,617		(2,189		)	2,428
In-process research and development, with indefinite lives	111		—			111
Total	$	4,728	$	(2,189	)	$	2,539



July 30, 2016	Gross		Accumulated Amortization			Net
Purchased intangible assets with finite lives:
Technology	$	3,038	$	(1,391	)	$	1,647
Customer relationships	1,793		(1,203		)	590
Other	85		(43		)	42
Total purchased intangible assets with finite lives	4,916		(2,637		)	2,279
In-process research and development, with indefinite lives	222		—			222
Total	$	5,138	$	(2,637	)	$	2,501

Purchased intangible assets include intangible assets acquired through acquisitions as well as through direct purchases or licenses.

Impairment charges related to purchased intangible assets were approximately $47 million, $74 million, and $175 million for fiscal 2017, fiscal 2016, and fiscal 2015, respectively. Impairment charges were as a result of declines in estimated fair value resulting from the reduction or elimination of expected future cash flows associated with certain of the Company’s technology and IPR&D intangible assets.

The following table presents the amortization of purchased intangible assets (in millions):



Years Ended	July 29, 2017		July 30, 2016		July 25, 2015
Amortization of purchased intangible assets:
Cost of sales	$	556	$	577	$	814
Operating expenses
Amortization of purchased intangible assets	259		303		359
Restructuring and other charges	38		—		—
Total	$	853	$	880	$	1,173

The estimated future amortization expense of purchased intangible assets with finite lives as of July 29, 2017 is as follows (in millions):



Fiscal Year	Amount
2018	$	790
2019	700
2020	483
2021	286
2022	102
Thereafter	67
Total	$	2,428

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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