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Financial Instruments (Tables)
 3 Months Ended
Dec. 28, 2019
Investments, All Other Investments [Abstract]  
Cash and Available-for-Sale Securities by Significant Investment Category
The following tables show the Company’s cash and marketable securities by significant investment category as of December 28, 2019 and September 28, 2019 (in millions):
 
December 28, 2019
 
Adjusted
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair
Value
 
Cash and
Cash
Equivalents
 
Current
Marketable
Securities
 
Non-Current
Marketable
Securities
Cash
$
11,383

 
$
—

 
$
—

 
$
11,383

 
$
11,383

 
$
—

 
$
—

Level 1 (1):
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
11,535

 
—

 
—

 
11,535

 
11,535

 
—

 
—

Subtotal
11,535

 
—

 
—

 
11,535

 
11,535

 
—

 
—

Level 2 (2):
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
28,600

 
29

 
(40
)
 
28,589

 
3,950

 
11,069

 
13,570

U.S. agency securities
8,302

 
2

 
(1
)
 
8,303

 
3,703

 
4,095

 
505

Non-U.S. government securities
18,978

 
324

 
(92
)
 
19,210

 
289

 
2,637

 
16,284

Certificates of deposit and time deposits
12,916

 
—

 
—

 
12,916

 
4,595

 
6,777

 
1,544

Commercial paper
17,823

 
—

 
—

 
17,823

 
4,254

 
13,569

 
—

Corporate debt securities
82,007

 
876

 
(37
)
 
82,846

 
62

 
27,894

 
54,890

Municipal securities
971

 
11

 
—

 
982

 
—

 
35

 
947

Mortgage- and asset-backed securities
13,475

 
68

 
(69
)
 
13,474

 
—

 
1,315

 
12,159

Subtotal
183,072

 
1,310

 
(239
)
 
184,143

 
16,853

 
67,391

 
99,899

Total (3)
$
205,990

 
$
1,310

 
$
(239
)
 
$
207,061

 
$
39,771

 
$
67,391

 
$
99,899

 
September 28, 2019
 
Adjusted
Cost
 
Unrealized
Gains
 
Unrealized
Losses
 
Fair
Value
 
Cash and
Cash
Equivalents
 
Current
Marketable
Securities
 
Non-Current
Marketable
Securities
Cash
$
12,204

 
$
—

 
$
—

 
$
12,204

 
$
12,204

 
$
—

 
$
—

Level 1 (1):
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market funds
15,897

 
—

 
—

 
15,897

 
15,897

 
—

 
—

Subtotal
15,897

 
—

 
—

 
15,897

 
15,897

 
—

 
—

Level 2 (2):
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Treasury securities
30,293

 
33

 
(62
)
 
30,264

 
6,165

 
9,817

 
14,282

U.S. agency securities
9,767

 
1

 
(3
)
 
9,765

 
6,489

 
2,249

 
1,027

Non-U.S. government securities
19,821

 
337

 
(50
)
 
20,108

 
749

 
3,168

 
16,191

Certificates of deposit and time deposits
4,041

 
—

 
—

 
4,041

 
2,024

 
1,922

 
95

Commercial paper
12,433

 
—

 
—

 
12,433

 
5,193

 
7,240

 
—

Corporate debt securities
85,383

 
756

 
(92
)
 
86,047

 
123

 
26,127

 
59,797

Municipal securities
958

 
8

 
(1
)
 
965

 
—

 
68

 
897

Mortgage- and asset-backed securities
14,180

 
67

 
(73
)
 
14,174

 
—

 
1,122

 
13,052

Subtotal
176,876

 
1,202

 
(281
)
 
177,797

 
20,743

 
51,713

 
105,341

Total (3)
$
204,977

 
$
1,202

 
$
(281
)
 
$
205,898

 
$
48,844

 
$
51,713

 
$
105,341

(1)
Level 1 fair value estimates are based on quoted prices in active markets for identical assets or liabilities.
(2)
Level 2 fair value estimates are based on observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
(3)
As of December 28, 2019 and September 28, 2019, total marketable securities included $19.1 billion and $18.9 billion, respectively, that was restricted from general use, related to the State Aid Decision (refer to Note 5, “Income Taxes”) and other agreements.
Cash, Cash Equivalents and Restricted Cash Reconciliation
A reconciliation of the Company’s cash and cash equivalents in the Condensed Consolidated Balance Sheets to cash, cash equivalents and restricted cash in the Condensed Consolidated Statements of Cash Flows as of December 28, 2019 and September 28, 2019 is as follows (in millions):
 
December 28,
2019
 
September 28,
2019
Cash and cash equivalents
$
39,771

 
$
48,844

Restricted cash included in other current assets
68

 
23

Restricted cash included in other non-current assets
1,826

 
1,357

Cash, cash equivalents and restricted cash
$
41,665

 
$
50,224
Derivative Instruments at Gross Fair Value The following tables show the Company’s derivative instruments at gross fair value as of December 28, 2019 and September 28, 2019 (in millions):
 
December 28, 2019
 
Fair Value of
Derivatives Designated
as Hedge Instruments
 
Fair Value of
Derivatives Not Designated
as Hedge Instruments
 
Total
Fair Value
Derivative assets (1):
 
 
 
 
 
Foreign exchange contracts
$
1,625

 
$
327

 
$
1,952

Interest rate contracts
$
475

 
$
—

 
$
475

 
 
 
 
 
 
Derivative liabilities (2):
 
 
 
 
 
Foreign exchange contracts
$
964

 
$
494

 
$
1,458

Interest rate contracts
$
57

 
$
—

 
$
57

 
September 28, 2019
 
Fair Value of
Derivatives Designated
as Hedge Instruments
 
Fair Value of
Derivatives Not Designated
as Hedge Instruments
 
Total
Fair Value
Derivative assets (1):
 
 
 
 
 
Foreign exchange contracts
$
1,798

 
$
323

 
$
2,121

Interest rate contracts
$
685

 
$
—

 
$
685

 
 
 
 
 
 
Derivative liabilities (2):
 
 
 
 
 
Foreign exchange contracts
$
1,341

 
$
160

 
$
1,501

Interest rate contracts
$
105

 
$
—

 
$
105

(1)
The fair value of derivative assets is measured using Level 2 fair value inputs and is included in other current assets and other non-current assets in the Condensed Consolidated Balance Sheets.
(2)
The fair value of derivative liabilities is measured using Level 2 fair value inputs and is included in other current liabilities and other non-current liabilities in the Condensed Consolidated Balance Sheets.
Pre-Tax Gains and Losses of Derivative and Non-Derivative Instruments Designated as Cash Flow and Net Investment Hedges
The following table shows the pre-tax gains and losses of the Company’s derivative and non-derivative instruments designated as cash flow and net investment hedges in OCI and the Condensed Consolidated Statements of Operations for the three months ended December 28, 2019 and December 29, 2018 (in millions):
 
Three Months Ended
 
December 28,
2019
 
December 29,
2018
Gains/(Losses) recognized in OCI – included in effectiveness assessment:
 
 
 
Cash flow hedges:
 
 
 
Foreign exchange contracts
$
271

 
$
(478
)
 
 
 
 
Net investment hedges:
 
 
 
Foreign currency debt
$
24

 
$
(16
)
 
 
 
 
Gains/(Losses) reclassified from AOCI into net income – included in effectiveness assessment:
 
 
 
Cash flow hedges:
 
 
 
Foreign exchange contracts
$
491

 
$
(118
)
Interest rate contracts
(2
)
 
(1
)
Total
$
489

 
$
(119
)
Derivative Instruments Designated as Fair Value Hedges and the Related Hedged Items
The following tables show information about the Company’s derivative instruments designated as fair value hedges and the related hedged items for the three months ended December 28, 2019 and December 29, 2018 and as of December 28, 2019 (in millions):
 
Three Months Ended
 
December 28,
2019
 
December 29,
2018
Gains/(Losses) on derivative instruments (1):
 
 
 
Foreign exchange contracts
$
(183
)
 
$
402

Interest rate contracts
(162
)
 
657

Total
$
(345
)
 
$
1,059

 
 
 
 
Gains/(Losses) related to hedged items (1):
 
 
 
Marketable securities
$
183

 
$
(402
)
Fixed-rate debt
162

 
(657
)
Total
$
345

 
$
(1,059
)
 
December 28,
2019
Carrying amounts of hedged assets/(liabilities):
 
Marketable securities (2)
$
15,544

Fixed-rate debt (3)
$
(28,631
)
 
 
Cumulative hedging adjustments included in the carrying amounts of hedged items:
 
Marketable securities carrying amount increases/(decreases)
$
(594
)
Fixed-rate debt carrying amount (increases)/decreases
$
(418
)
(1)
Gains and losses related to fair value hedges are included in OI&E in the Condensed Consolidated Statements of Operations.
(2)
The carrying amounts of marketable securities that are designated as hedged items in fair value hedges are included in current marketable securities and non-current marketable securities in the Condensed Consolidated Balance Sheet.
(3)
The carrying amounts of fixed-rate debt instruments that are designated as hedged items in fair value hedges are included in current term debt and non-current term debt in the Condensed Consolidated Balance Sheet.
Notional Amounts of Outstanding Derivative Instruments and Credit Risk Amounts Associated with Outstanding or Unsettled Derivative Instruments
The following table shows the notional amounts of the Company’s outstanding derivative instruments and credit risk amounts associated with outstanding or unsettled derivative instruments as of December 28, 2019 and September 28, 2019 (in millions):
 
December 28, 2019
 
September 28, 2019
 
Notional
Amount
 
Credit Risk
Amount
 
Notional
Amount
 
Credit Risk
Amount
Instruments designated as accounting hedges:
 
 
 
 
 
 
 
Foreign exchange contracts
$
54,215

 
$
1,625

 
$
61,795

 
$
1,798

Interest rate contracts
$
28,250

 
$
475

 
$
31,250

 
$
685

 
 
 
 
 
 
 
 
Instruments not designated as accounting hedges:
 
 
 
 
 
 
 
Foreign exchange contracts
$
96,470

 
$
327

 
$
76,868

 
$
323