Goodwill and Intangible Assets

12 Months Ended

Oct. 31, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

Goodwill and related changes in the carrying amount by reportable segment were as follows:



	Hybrid IT⁽¹⁾			Intelligent Edge⁽¹⁾		Financial Services		Corporate Investments⁽¹⁾			Total
	In millions
Balance at October 31, 2017	$	15,373		$	1,911	$	144	$	88		$	17,516
Goodwill acquired during the period	101			3		—		—			104
Impairment of goodwill	—			—		—		(88		)	(88		)
Changes due to foreign currency	(1		)	—		—		—			(1		)
Goodwill adjustments	6			—		—		—			6
Balance at October 31, 2018	15,479			1,914		144		—			17,537
Goodwill acquired during the period	767			—		—		—			767
Goodwill adjustments	2			—		—		—			2
Balance at October 31, 2019	$	16,248		$	1,914	$	144	$	—		$	18,306


(1)	Effective at the beginning of the first quarter of fiscal 2019, the Company implemented organizational changes to align its segment financial reporting more closely with its current business structure, which are described in detail in Note 3, "Segment Information". Goodwill was reclassified to the respective segments using a relative fair value approach.

Goodwill Impairments

Goodwill is tested for impairment at the reporting unit level. The Company's reporting units containing goodwill are consistent with the reportable segments identified in Note 3, "Segment Information".

Based on the results of the Company's annual impairment tests in fiscal 2019, 2018 and 2017, the Company determined that no impairment of goodwill existed.

Based on the results of the Company's interim impairment tests in fiscal 2018 it was concluded that the fair value of CMS was less than its carrying amount. Prior to calculating the goodwill impairment loss, the Company analyzed the recoverability of CMS long-lived assets other than goodwill and concluded that those assets were not impaired. As a result, the Company recorded a goodwill impairment charge of $88 million. There is no remaining goodwill in the CMS reporting unit as of October 31, 2018.

Intangible Assets

Intangible assets comprise:



	As of October 31, 2019							As of October 31, 2018
	Gross		Accumulated Amortization			Net		Gross		Accumulated Amortization			Net
	In millions
Customer contracts, customer lists and distribution agreements	$	312	$	(96	)	$	216	$	272	$	(142	)	$	130
Developed and core technology and patents	1,371		(719		)	652		1,121		(525		)	596
Trade name and trade marks	163		(44		)	119		87		(42		)	45
In-process research and development	141		—			141		18		—			18
Total intangible assets	$	1,987	$	(859	)	$	1,128	$	1,498	$	(709	)	$	789

For fiscal 2019, the increase in gross intangible assets was due primarily to $606 million of purchases related to acquisitions, partially offset by $117 million of intangible assets which became fully amortized and were eliminated from gross intangible assets and accumulated amortization.

For fiscal 2018, the decrease in gross intangible assets was due primarily to $106 million of intangible assets which became fully amortized and were eliminated from gross intangible assets and accumulated amortization, partially offset by $41 million of purchases related to acquisitions.

The Company reclassified in-process research and development assets acquired of $18 million and $57 million to developed and core technology and patents as the projects were completed, and began amortization during fiscal 2019 and fiscal 2018, respectively.

As of October 31, 2019, the weighted-average remaining useful lives of the Company's finite-lived intangible assets were as follows:



Finite-Lived Intangible Assets	Weighted-Average Remaining Useful Lives
	In years
Customer contracts, customer lists and distribution agreements	3
Developed and core technology and patents	4
Trade name and trade marks	5

As of October 31, 2019, estimated future amortization expense related to finite-lived intangible assets was as follows:



Fiscal year	In millions
2020	$	325
2021	251
2022	172
2023	138
2024	87
Thereafter	14
Total	$	987