Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Income Tax Disclosure [Abstract]

Geographical Sources of (Loss) Income Before Income Taxes

The geographical sources of income (loss) before income taxes were as follows (in millions):

	Year Ended December 31,
	2017			2016			2015
United States	$	(152	)	$	(120	)	$	(288	)
Outside United States	240			(9		)	108
Total	$	88		$	(129	)	$	(180	)

Components of Provision (Benefit) for Income Taxes

Income tax expense (benefit) consisted of the following (in millions):

	Year Ended December 31,
	2017			2016			2015
Current:
Federal	$	10		$	14		$	84
State	8			6			4
Foreign	62			31			32
Total current	80			51			120
Deferred:
Federal	20			(31		)	(117		)
State	(10		)	(6		)	(24		)
Foreign	(19		)	(6		)	(1		)
Total deferred	(9		)	(43		)	(142		)
Total expense (benefit)	$	71		$	8		$	(22	)

Reconciliation of Provision for Income Taxes

A reconciliation between the Provision computed at the statutory rate and the Provision for income taxes is provided below:

	Year Ended December 31,
	2017		2016		2015
Provision computed at statutory rate	35.0	%	35.0	%	35.0	%
U.S. Tax Reform - One-time transaction tax	41.8		0.0		0.0
Remeasurement of Deferred Taxes	(56.0	)	0.0		0.0
Change in valuation allowance	96.4		(1.0	)	(8.3	)
US impact of Enterprise acquisition	12.9		(14.1	)	(26.7	)
Change in contingent income tax reserves	14.0		(1.6	)	(3.3	)
Foreign earnings subject to U.S. taxation	2.0		(6.6	)	(3.9	)
Foreign rate differential	(29.1	)	(16.0	)	13.9
Intra-entity transactions	(18.8	)	0.0		0.0
State income tax, net of federal tax benefit	(5.3	)	(1.0	)	1.1
Tax credits	(5.7	)	9.5		6.1
Equity compensation deductions	(5.6	)	(0.4	)	0.0
Return to provision and other true ups	(3.2	)	(3.7	)	0.0
Other	2.3		(6.3	)	(1.7	)
Provision for income taxes	80.7	%	(6.2	)%	12.2	%

Components of Deferred Tax Assets and Liabilities

Tax effects of temporary differences that resulted in deferred tax assets and liabilities are as follows (in millions):

	December 31,
	2017			2016
Deferred tax assets:
Capitalized research expenditures	$	32		$	58
Deferred revenue	21			57
Tax credits	31			33
Net operating loss carryforwards	338			35
Other accruals	20			31
Inventory items	20			27
Capitalized software costs	14			25
Sales return/rebate reserve	33			27
Share-based compensation expense	12			15
Accrued bonus	1			11
Unrealized gains and losses on securities and investments	8			4
Valuation allowance	(134		)	(47		)
Total deferred tax assets	396			276
Deferred tax liabilities:
Depreciation and amortization	275			165
Undistributed earnings	2			1
Total deferred tax liabilities	$	277		$	166
Net deferred tax assets	$	119		$	110

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in millions):

	Year ended December 31,
	2017			2016
Balance at beginning of year	$	42		$	40
Additions for tax positions related to the current year	—			2
Additions for tax positions related to prior years	11			2
Reductions for tax positions related to prior years	(1		)	(2		)
Settlements for tax positions	(1		)	—
Balance at end of year	$	51		$	42