Goodwill and Other Intangible Assets

12 Months Ended

Sep. 24, 2011

Note 4 – Goodwill and Other Intangible Assets

The Company is currently amortizing its acquired intangible assets with definite lives over periods generally ranging between three to seven years. The following table summarizes the components of gross and net intangible asset balances as of September 24, 2011 and September 25, 2010 (in millions):


	2011							2010
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Definite lived and amortizable acquired intangible assets	$	3,873	$	(437	)	$	3,436	$	487	$	(245	)	$	242
Indefinite lived and non-amortizable trademarks		100		0			100		100		0			100

Total acquired intangible assets	$	3,973	$	(437	)	$	3,536	$	587	$	(245	)	$	342

During 2011 and 2010, the Company completed various business acquisitions. In 2011, the aggregate cash consideration, net of cash acquired, was $244 million, of which $167 million was allocated to goodwill and $77 million to acquired intangible assets. In 2010, the aggregate cash consideration, net of cash acquired, was $638 million, of which $535 million was allocated to goodwill and $107 million to acquired intangible assets.

During 2011, the Company, as part of a consortium, acquired Nortel Networks Corporation’s patent portfolio for an overall purchase price of $4.5 billion, of which the Company’s contribution was approximately $2.6 billion. The majority of the acquisition price has been recorded in acquired intangible assets, which the Company expects to amortize over seven years. The Department of Justice is reviewing this transaction.

The Company’s gross carrying amount of goodwill was $896 million and $741 million as of September 24, 2011 and September 25, 2010, respectively. The Company did not have any goodwill impairment during 2011, 2010 or 2009. The Company’s goodwill is allocated primarily to the Americas and Europe reportable operating segments.

Amortization expense related to acquired intangible assets was $192 million, $69 million and $53 million in 2011, 2010 and 2009, respectively. As of September 24, 2011 the weighted-average amortization period for acquired intangible assets was 6.2 years. The expected annual amortization expense related to acquired intangible assets as of September 24, 2011, is as follows (in millions):


Years
2012	$	520
2013		596
2014		608
2015		441
2016		426
Thereafter		845

Total	$	3,436

- 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.

+ References+ Details