Condensed Consolidating Financial Statements (Tables)

9 Months Ended

Mar. 31, 2017

Condensed Financial Statements, Captions [Line Items]

Condensed Balance Sheet [Table Text Block]

Condensed Consolidating Balance Sheet
As of March 31, 2017
	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total Company
	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	270	$	856	$	4,526	$	—		$	5,652
Short-term investments	—		—		25		—			25
Accounts receivable, net	—		1,212		736		—			1,948
Intercompany receivable	1,143		1,997		2,923		(6,063		)	—
Inventories	—		1,067		1,458		(271		)	2,254
Other current assets	5		216		223		(10		)	434
Total current assets	1,418		5,348		9,891		(6,344		)	10,313
Property, plant and equipment, net	—		1,170		1,929		—			3,099
Notes receivable and investments in Flash Ventures	—		—		1,291		—			1,291
Goodwill	—		325		9,687		—			10,012
Other intangible assets, net	—		15		4,129		—			4,144
Investments in consolidated subsidiaries	18,344		18,199		—		(36,543		)	—
Loans due from consolidated affiliates	5,005		313		—		(5,318		)	—
Other non-current assets	46		89		478		(24		)	589
Total assets	$	24,813	$	25,459	$	27,405	$	(48,229	)	$	29,448
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	264	$	1,921	$	—		$	2,185
Intercompany payable	171		5,233		659		(6,063		)	—
Accounts payable to related parties	—		—		194		—			194
Accrued expenses	254		473		353		(7		)	1,073
Accrued compensation	—		291		189		—			480
Accrued warranty	—		4		192		—			196
Current portion of long-term debt	181		—		—		—			181
Total current liabilities	606		6,265		3,508		(6,070		)	4,309
Long-term debt	12,878		—		29		—			12,907
Loans due to consolidated affiliates	298		34		4,986		(5,318		)	—
Other liabilities	—		619		609		(27		)	1,201
Total liabilities	13,782		6,918		9,132		(11,415		)	18,417
Shareholders’ equity	11,031		18,541		18,273		(36,814		)	11,031
Total liabilities and shareholders’ equity	$	24,813	$	25,459	$	27,405	$	(48,229	)	$	29,448

Condensed Consolidating Balance Sheet
As of July 1, 2016
	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total Company
	(in millions)
ASSETS
Current assets:
Cash and cash equivalents	$	—	$	1,206	$	6,945	$	—		$	8,151
Short-term investments	—		—		227		—			227
Accounts receivable, net	—		985		476		—			1,461
Intercompany receivable	934		886		2,546		(4,366		)	—
Inventories	—		896		1,450		(217		)	2,129
Other current assets	4		276		379		(43		)	616
Total current assets	938		4,249		12,023		(4,626		)	12,584
Property, plant and equipment, net	—		1,265		2,238		—			3,503
Notes receivable and investments in Flash Ventures	—		—		1,171		—			1,171
Goodwill	—		324		9,627		—			9,951
Other intangible assets, net	—		28		5,006		—			5,034
Investments in consolidated subsidiaries	18,009		27,020		—		(45,029		)	—
Loans due from consolidated affiliates	6,000		55		—		(6,055		)	—
Other non-current assets	50		33		702		(166		)	619
Total assets	$	24,997	$	32,974	$	30,767	$	(55,876	)	$	32,862
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	—	$	239	$	1,649	$	—		$	1,888
Intercompany payable	119		4,043		204		(4,366		)	—
Accounts payable to related parties	—		—		168		—			168
Accrued expenses	109		462		404		20			995
Accrued compensation	—		222		170		—			392
Accrued warranty	—		4		168		—			172
Bridge loan	—		2,995		—		—			2,995
Current portion of long-term debt	14		—		325		—			339
Total current liabilities	242		7,965		3,088		(4,346		)	6,949
Long-term debt	13,610		—		50		—			13,660
Loans due to consolidated affiliates	—		6,000		55		(6,055		)	—
Other liabilities	—		862		475		(229		)	1,108
Total liabilities	13,852		14,827		3,668		(10,630		)	21,717
Shareholders’ equity	11,145		18,147		27,099		(45,246		)	11,145
Total liabilities and shareholders’ equity	$	24,997	$	32,974	$	30,767	$	(55,876	)	$	32,862

Condensed Income Statement [Table Text Block]

Condensed Consolidating Statement of Operations
For the three months ended March 31, 2017
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Revenue, net	$	—		$	3,406		$	4,333		$	(3,090	)	$	4,649
Cost of revenue	—			2,791			3,403			(3,068		)	3,126
Gross profit	—			615			930			(22		)	1,523
Operating expenses:
Research and development	—			413			200			—			613
Selling, general, and administrative	1			240			105			—			346
Intercompany operating expense (income)	—			(282		)	282			—			—
Employee termination, asset impairment, and other charges	—			30			9			—			39
Total operating expenses	1			401			596			—			998
Operating income (loss)	(1		)	214			334			(22		)	525
Interest and other income (expense):
Interest income	88			8			6			(95		)	7
Interest expense	(211		)	—			(89		)	95			(205		)
Other expense, net	(9		)	(6		)	(8		)	—			(23		)
Total interest and other income (expense), net	(132		)	2			(91		)	—			(221		)
Income (loss) before taxes	(133		)	216			243			(22		)	304
Income tax expense (benefit)	(26		)	56			26			—			56
Equity in earnings from subsidiaries	355			229			—			(584		)	—
Net income	$	248		$	389		$	217		$	(606	)	$	248

Condensed Consolidating Statement of Operations
For the nine months ended March 31, 2017
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Revenue, net	$	—		$	10,890		$	12,871		$	(9,510	)	$	14,251
Cost of revenue	—			8,941			10,451			(9,532		)	9,860
Gross profit	—			1,949			2,420			22			4,391
Operating expenses:
Research and development	—			1,226			611			—			1,837
Selling, general, and administrative	5			766			329			—			1,100
Intercompany operating expense (income)	—			(851		)	851			—			—
Employee termination, asset impairment, and other charges	—			88			64			—			152
Total operating expenses	5			1,229			1,855			—			3,089
Operating income (loss)	(5		)	720			565			22			1,302
Interest and other income (expense):
Interest income	268			9			15			(275		)	17
Interest expense	(642		)	(5		)	(274		)	275			(646		)
Other expense, net	(283		)	(10		)	(26		)	—			(319		)
Total interest and other expense, net	(657		)	(6		)	(285		)	—			(948		)
Income (loss) before taxes	(662		)	714			280			22			354
Income tax expense (benefit)	(207		)	177			267			—			237
Equity in earnings from subsidiaries	572			21			—			(593		)	—
Net income	$	117		$	558		$	13		$	(571	)	$	117

Condensed Consolidating Statement of Operations
For the three months ended April 1, 2016
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Revenue, net	$	—		$	2,959		$	2,895		$	(3,032	)	$	2,822
Cost of revenue	—			2,780			2,310			(3,021		)	2,069
Gross profit	—			179			585			(11		)	753
Operating expenses:
Research and development	—			252			107			—			359
Selling, general, and administrative	1			134			31			—			166
Intercompany operating expense (income)	—			(255		)	255			—			—
Employee termination, asset impairment, and other charges	—			9			131			—			140
Total operating expenses	1			140			524			—			665
Operating income (loss)	(1		)	39			61			(11		)	88
Interest and other income (expense):
Interest income	—			—			6			—			6
Interest expense	—			(13		)	(1		)	—			(14		)
Total interest and other income (expense), net	—			(13		)	5			—			(8		)
Income (loss) before taxes	(1		)	26			66			(11		)	80
Income tax expense (benefit)	(1		)	4			3			—			6
Equity in earnings from subsidiaries	74			60			—			(134		)	—
Net income	$	74		$	82		$	63		$	(145	)	$	74

Condensed Consolidating Statement of Operations
For the nine months ended April 1, 2016
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Revenue, net	$	—		$	9,796		$	9,919		$	(10,216	)	$	9,499
Cost of revenue	—			9,190			7,888			(10,193		)	6,885
Gross profit	—			606			2,031			(23		)	2,614
Operating expenses:
Research and development	—			831			302			—			1,133
Selling, general, and administrative	3			443			151			—			597
Intercompany operating expense (income)	—			(845		)	845			—			—
Employee termination, asset impairment, and other charges	—			79			144			—			223
Total operating expenses	3			508			1,442			—			1,953
Operating income (loss)	(3		)	98			589			(23		)	661
Interest and other income (expense):
Interest income	—			1			14			—			15
Interest expense	—			(35		)	(5		)	—			(40		)
Other income, net	—			—			2			—			2
Total interest and other income (expense), net	—			(34		)	11			—			(23		)
Income (loss) before taxes	(3		)	64			600			(23		)	638
Income tax expense (benefit)	(1		)	56			(25		)	—			30
Equity in earnings from subsidiaries	610			622			—			(1,232		)	—
Net income	$	608		$	630		$	625		$	(1,255	)	$	608

Condensed Statement of Comprehensive Income [Table Text Block]

Condensed Consolidating Statement of Comprehensive Income (Loss)
For the three months ended March 31, 2017
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Net income	$	248		$	389		$	217		$	(606	)	$	248
Other comprehensive income, before tax:
Actuarial pension gain	1			1			1			(2		)	1
Foreign currency translation adjustment	58			58			58			(116		)	58
Net unrealized gain on foreign exchange contracts	45			42			41			(83		)	45
Total other comprehensive income, before tax	104			101			100			(201		)	104
Income tax expense related to items of other comprehensive income	(3		)	(3		)	(2		)	5			(3		)
Other comprehensive income, net of tax	101			98			98			(196		)	101
Total comprehensive income	$	349		$	487		$	315		$	(802	)	$	349

Condensed Consolidating Statement of Comprehensive Income (Loss)
For the nine months ended March 31, 2017
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Net income	$	117		$	558		$	13		$	(571	)	$	117
Other comprehensive loss, before tax:
Actuarial pension gain	7			7			7			(14		)	7
Foreign currency translation adjustment	(111		)	(111		)	(134		)	245			(111		)
Net unrealized loss on foreign exchange contracts	(95		)	(98		)	(95		)	193			(95		)
Total other comprehensive loss, before tax	(199		)	(202		)	(222		)	424			(199		)
Income tax benefit (expense) related to items of other comprehensive loss	—			—			(1		)	1			—
Other comprehensive loss, net of tax	(199		)	(202		)	(223		)	425			(199		)
Total comprehensive income (loss)	$	(82	)	$	356		$	(210	)	$	(146	)	$	(82	)

Condensed Consolidating Statement of Comprehensive Income (Loss)
For the three months ended April 1, 2016
	Parent		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Total Company
	(in millions)
Net income	$	74	$	82	$	63	$	(145	)	$	74
Other comprehensive income, before tax:
Net unrealized gain on foreign exchange contracts	40		40		34		(75		)	39
Net unrealized gain on available-for-sale securities	—		1		1		(2		)	—
Total other comprehensive income, before tax	40		41		35		(77		)	39
Income tax benefit related to items of other comprehensive income	—		—		—		—			—
Other comprehensive income, net of tax	40		41		35		(77		)	39
Total comprehensive income	$	114	$	123	$	98	$	(222	)	$	113

Condensed Consolidating Statement of Comprehensive Income (Loss)
For the nine months ended April 1, 2016
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Net income	$	608		$	630		$	625		$	(1,255	)	$	608
Other comprehensive income, before tax:
Net unrealized gain on foreign exchange contracts	53			53			46			(100		)	52
Net unrealized gain (loss) on available-for-sale securities	(1		)	(1		)	(1		)	3			—
Total other comprehensive income, before tax	52			52			45			(97		)	52
Income tax benefit related to items of other comprehensive income	—			—			—			—			—
Other comprehensive income, net of tax	52			52			45			(97		)	52
Total comprehensive income	$	660		$	682		$	670		$	(1,352	)	$	660

Condensed Cash Flow Statement [Table Text Block]

Condensed Consolidating Statement of Cash Flows
For the nine months ended March 31, 2017
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Cash flows from operating activities
Net cash provided by (used in) operating activities	$	(443	)	$	617		$	2,177		$	147		$	2,498
Cash flows from investing activities
Purchases of property, plant and equipment	—			(185		)	(268		)	—			(453		)
Proceeds from the sale of equipment	—			—			21			—			21
Purchases of investments	—			—			(274		)	—			(274		)
Proceeds from sale of investments	—			—			75			—			75
Proceeds from maturities of investments	—			—			430			—			430
Investments in Flash Ventures	—			—			(20		)	—			(20		)
Notes receivable issuances to Flash Ventures	—			—			(480		)	—			(480		)
Notes receivable proceeds from Flash Ventures	—			—			276			—			276
Strategic investments and other, net	—			—			(21		)	—			(21		)
Intercompany loans from (to) consolidated affiliates	995			(258		)	—			(737		)	—
Advances from (to) consolidated affiliates	244			(236		)	—			(8		)	—
Net cash provided by (used in) investing activities	1,239			(679		)	(261		)	(745		)	(446		)
Cash flows from financing activities
Issuance of stock under employee stock plans	123			—			—			—			123
Taxes paid on vested stock awards under employee stock plans	(111		)	—			—			—			(111		)
Excess tax benefits from employee stock plans	90			—			—			—			90
Proceeds from acquired call option	—			—			61			—			61
Dividends paid to shareholders	(428		)	—			—			—			(428		)
Repayment of debt	(8,692		)	(2,995		)	(492		)	—			(12,179		)
Proceeds from debt	7,908			—			—			—			7,908
Debt issuance costs	(10		)	—			—			—			(10		)
Intercompany loans from (to) consolidated affiliates	298			(5,966		)	4,931			737			—
Change in investment in consolidated subsidiaries	296			8,673			(8,830		)	(139		)	—
Net cash used in financing activities	(526		)	(288		)	(4,330		)	598			(4,546		)
Effect of exchange rate changes on cash	—			—			(5		)	—			(5		)
Net increase (decrease) in cash and cash equivalents	270			(350		)	(2,419		)	—			(2,499		)
Cash and cash equivalents, beginning of year	—			1,206			6,945			—			8,151
Cash and cash equivalents, end of period	$	270		$	856		$	4,526		$	—		$	5,652

Condensed Consolidating Statement of Cash Flows
For the nine months ended April 1, 2016
	Parent			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Total Company
	(in millions)
Cash flows from operating activities
Net cash provided by operating activities	$	21		$	322		$	1,289		$	(4	)	$	1,628
Cash flows from investing activities
Purchases of property, plant and equipment	—			(168		)	(265		)	—			(433		)
Purchases of investments	—			—			(462		)	—			(462		)
Proceeds from sale of investments	—			—			604			—			604
Proceeds from maturities of investments	—			—			303			—			303
Strategic investments and other, net	—			—			(23		)	—			(23		)
Advances from (to) consolidated affiliates	269			(269		)	—			—			—
Net cash provided by (used in) investing activities	269			(437		)	157			—			(11		)
Cash flows from financing activities
Issuance of stock under employee stock plans	64			—			—			—			64
Taxes paid on vested stock awards under employee stock plans	(45		)	—			—			—			(45		)
Excess tax benefits from employee stock plans	(2		)	—			—			—			(2		)
Repurchases of common stock	(60		)	—			—			—			(60		)
Dividends paid to shareholders	(347		)	—			—			—			(347		)
Repayment of debt	—			(109		)	(255		)	—			(364		)
Change in investment in consolidated subsidiaries	100			(65		)	(39		)	4			—
Net cash used in financing activities	(290		)	(174		)	(294		)	4			(754		)
Net increase (decrease) in cash and cash equivalents	—			(289		)	1,152			—			863
Cash and cash equivalents, beginning of year	—			661			4,363			—			5,024
Cash and cash equivalents, end of period	$	—		$	372		$	5,515		$	—		$	5,887