Summary of Significant Accounting Policies (Tables)

12 Months Ended

Nov. 02, 2013

Unrealized gains and losses on available-for-sale securities classified as short-term investments

Unrealized gains and losses on available-for-sale securities classified as short-term investments at November 2, 2013 and November 3, 2012 were as follows:



	2013			2012
Unrealized gains on securities classified as short-term investments	$	1,137		$	581
Unrealized losses on securities classified as short-term investments	(511		)	(519		)
Net unrealized gains on securities classified as short-term investments	$	626		$	62

Cash and cash equivalents and short term investments

The components of the Company’s cash and cash equivalents and short-term investments as of November 2, 2013 and November 3, 2012 were as follows:



	2013		2012
Cash and cash equivalents:
Cash	$	45,637	$	35,413
Available-for-sale	346,452		490,904
Held-to-maturity	—		2,516
Total cash and cash equivalents	$	392,089	$	528,833
Short-term investments:
Available-for-sale	$	4,290,823	$	3,370,551
Held-to-maturity (less than one year to maturity)	—		994
Total short-term investments	$	4,290,823	$	3,371,545

Supplemental cash flow statement Information



	2013		2012		2011
Cash paid during the fiscal year for:
Income taxes	$	36,863	$	143,899	$	223,716
Interest	$	29,354	$	29,177	$	16,492

Inventories

Inventories at November 2, 2013 and November 3, 2012 were as follows:



	2013		2012
Raw materials	$	19,641	$	28,111
Work in process	175,155		185,773
Finished goods	88,541		99,839
Total inventories	$	283,337	$	313,723

Useful lives of property, plant and equipment

Depreciation and amortization are based on the following useful lives:



Buildings & building equipment	Up to 25 years
Machinery & equipment	3-8 years
Office equipment	3-8 years

Changes in goodwill

The following table presents the changes in goodwill during fiscal 2013 and fiscal 2012:



	2013			2012
Balance at beginning of year	$	283,833		$	275,087
Acquisition of Multigig, Inc. (Note 6)	—			7,298
Goodwill allocated to sale of product line (Note 17)	(1,609		)	—
Foreign currency translation adjustment	1,888			1,448
Balance at end of year	$	284,112		$	283,833

Intangible assets consisted of the following:

As of November 2, 2013 and November 3, 2012, the Company’s finite-lived intangible assets consisted of the following which related to the acquisition of Multigig, Inc. See Note 6 below for further information related to the acquisition of Multigig, Inc.



	November 2, 2013				November 3, 2012
	Gross Carrying Amount		Accumulated Amortization		Gross Carrying Amount		Accumulated Amortization
Technology-based	$	1,100	$	348	$	1,100	$	128

Schedule of expected annual amortization expense

The Company expects annual amortization expense for intangible assets to be:



Fiscal Year	Amortization Expense
2014	$	220
2015	$	220
2016	$	220
2017	$	92

Net gain or loss on the hedged item

The gain or loss on the hedged item (that is, the fixed-rate borrowings) attributable to the hedged benchmark interest rate risk and the offsetting gain or loss on the related interest rate swaps for fiscal year 2012 and fiscal year 2011 was as follows:



Statement of income classification	November 3, 2012							October 29, 2011
Statement of income classification	Loss on Swaps			Gain on Note		Net Income Effect		Loss on Swaps			Gain on Note		Net Income Effect
Other income	$	(769	)	$	769	$	—	$	(4,614	)	$	4,614	$	—

Fair value of hedging instruments

The fair values of these hedging instruments in the Company’s consolidated balance sheets as of November 2, 2013 and November 3, 2012 were as follows:



		Fair Value At
	Balance Sheet Location	November 2, 2013		November 3, 2012
Forward foreign currency exchange contracts	Prepaid expenses and other current assets	$	2,377	$	1,161

Effect of derivative instruments designated as cash flow hedges

The effect of forward foreign currency derivative instruments designated as cash-flow hedges on the consolidated statements of income and OCI for fiscal 2013 and 2012 were as follows:



	November 2, 2013			November 3, 2012
Loss recognized in OCI on derivatives (net of tax of $409 in 2013 and $1,233 in 2012)	$	(2,589	)	$	(7,923	)
Amounts reclassified from OCI into income (net of tax of $195 in 2013 and $1,160 in 2012)	$	(1,479	)	$	7,401

Cash flow hedge reclassified into earnings

The amounts reclassified into earnings before tax related to forward foreign currency derivative instruments, are recognized in cost of sales and operating expenses for fiscal 2013 and fiscal 2012 were as follows:



	November 2, 2013			November 3, 2012
Cost of sales	$	(967	)	$	3,096
Research and development	$	(551	)	$	2,344
Selling, marketing, general and administrative	$	(156	)	$	3,121

Summary of activity in accumulated other comprehensive (loss) income related to derivatives

The following table summarizes activity in accumulated other comprehensive (loss) income related to derivatives classified as cash flow hedges held by the Company during the period from October 30, 2011 through November 2, 2013:



	2013			2012
Balance at beginning of year, net of tax	$	1,165		$	1,687
Changes in fair value of derivatives — gain (loss), net of tax	9,708			(7,923		)
(Gain) loss reclassified into earnings from other comprehensive income (loss), net of tax	(1,776		)	7,401
Balance at end of year, net of tax	$	9,097		$	1,165

Fair value of financial assets and liabilities

The tables below, set forth by level, the Company’s financial assets and liabilities, excluding accrued interest components, that were accounted for at fair value on a recurring basis as of November 2, 2013 and November 3, 2012. The tables exclude cash on hand and assets and liabilities that are measured at historical cost or any basis other than fair value. As of November 2, 2013 and November 3, 2012, the Company held $45.6 million and $38.9 million, respectively, of cash and held-to-maturity investments that were excluded from the tables below.



	November 2, 2013
	Fair Value measurement at Reporting Date using:
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total
Assets
Cash equivalents:
Available-for-sale:
Institutional money market funds	$	186,896	$	—	$	—	$	186,896
Corporate obligations (1)	—		159,556		—		159,556
Short - term investments:
Available-for-sale:
Securities with one year or less to maturity:
Corporate obligations (1)	—		3,764,213		—		3,764,213
Floating rate notes, issued at par	—		207,521		—		207,521
Floating rate notes (1)	—		113,886		—		113,886
Securities with greater than one year to maturity:
Floating rate notes, issued at par	—		205,203		—		205,203
Other assets:
Forward foreign currency exchange contracts (2)	$	—	$	2,267	$	—	$	2,267
Deferred compensation investments	17,431		—		—		17,431
Total assets measured at fair value	$	204,327	$	4,452,646	$	—	$	4,656,973
Liabilities
Contingent consideration	—		—		6,479		6,479
Total liabilities measured at fair value	$	—	$	—	$	6,479	$	6,479


(1)	The amortized cost of the Company’s investments classified as available-for-sale as of November 2, 2013 was $3,824.0 million.


(2)	The Company has a master netting arrangement by counterparty with respect to derivative contracts. As of November 2, 2013, contracts in a liability position of $2.0 million were netted against contracts in an asset position in the consolidated balance sheet.



	November 3, 2012
	Fair Value measurement at Reporting Date using:
	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total
Assets
Cash equivalents:
Available-for-sale:
Institutional money market funds	$	143,876	$	—	$	—	$	143,876
Corporate obligations (1)	—		347,028		—		347,028
Short - term investments:
Available-for-sale:
Securities with one year or less to maturity:
Corporate obligations (1)	—		2,818,798		—		2,818,798
Floating rate notes, issued at par	—		280,065		—		280,065
Floating rate notes (1)	—		234,280		—		234,280
Securities with greater than one year to maturity:
Floating rate notes, issued at par	—		37,408		—		37,408
Other assets:
Forward foreign currency exchange contracts (2)	—		1,061		—		1,061
Deferred compensation investments	28,480		—		—		28,480
Total assets measured at fair value	$	172,356	$	3,718,640	$	—	$	3,890,996
Liabilities
Contingent consideration	—		—		12,219		12,219
Total liabilities measured at fair value	$	—	$	—	$	12,219	$	12,219


(1)	The amortized cost of the Company’s investments classified as available-for-sale as of November 3, 2012 was $3,327.5 million.


(2)	The Company has a master netting arrangement by counterparty with respect to derivative contracts. As of November 3, 2012, contracts in a liability position of $1.9 million were netted against contracts in an asset position in the consolidated balance sheet.

Schedule of fair value inputs

The fair value measurement of the contingent consideration encompasses the following significant unobservable inputs:



Unobservable Inputs	Range
Estimated contingent consideration payments	$7,000
Discount rate	8% - 10%
Timing of cash flows	1 - 23 months
Probability of achievement	100%

Change in the fair value of the contingent consideration

The following table summarizes the change in the fair value of the contingent consideration measured using significant unobservable inputs (Level 3) as of November 3, 2012 and November 2, 2013:



	Contingent Consideration
Balance as of October 30, 2010	$	—
Contingent consideration liability recorded	13,790
Fair value adjustment (2)	183
Balance as of October 29, 2011	$	13,973
Payment made (1)	(2,000		)
Fair value adjustment (2)	246
Balance as of November 3, 2012	$	12,219
Payment made (1)	(6,000		)
Fair value adjustment (2)	260
Balance as of November 2, 2013	$	6,479


(1)	The payment is reflected in the statements of cash flows as cash used in financing activities related to the liability recognized at fair value as of the acquisition date and as cash provided by operating activities related to the fair value adjustments previously recognized in earnings.


(2)	Recorded in research and development expense in the consolidated statements of income.

Components of accumulated other comprehensive (loss)

The components of accumulated other comprehensive loss at November 2, 2013 and November 3, 2012 consisted of the following, net of tax:



	2013			2012
Foreign currency translation adjustment	$	483		$	982
Unrealized gains on available-for-sale securities	953			444
Unrealized losses on available-for-sale securities	(435		)	(423		)
Unrealized gains on derivative instruments	9,097			1,165
Pension plans
Prior service cost	4,076			4,079
Transition obligation	(82		)	(102		)
Net actuarial loss	(94,638		)	(70,539		)
Total accumulated other comprehensive loss	$	(80,546	)	$	(64,394	)

Computation of basic and diluted earnings per share

The following table sets forth the computation of basic and diluted earnings per share:



	2013		2012		2011
Income from continuing operations, net of tax	$	673,487	$	651,236	$	860,894
Gain on sale of discontinued operations, net of tax	—		—		6,500
Net income	$	673,487	$	651,236	$	867,394
Basic shares:
Weighted average shares outstanding	307,763		298,761		299,417
Earnings per share-basic:
Income from continuing operations, net of tax	$	2.19	$	2.18	$	2.88
Total income from discontinued operations, net of tax	—		—		0.02
Net income	$	2.19	$	2.18	$	2.90
Diluted shares:
Weighted average shares outstanding	307,763		298,761		299,417
Assumed exercise of common stock equivalents	6,278		7,430		8,819
Weighted average common and common equivalent shares	314,041		306,191		308,236
Earnings per share-diluted:
Income from continuing operations, net of tax	$	2.14	$	2.13	$	2.79
Total income from discontinued operations, net of tax	—		—		0.02
Net income	$	2.14	$	2.13	$	2.81
Anti-dilutive shares related to:
Outstanding stock options	4,116		7,209		9,526

Income from discontinued operations, net of tax

The following amounts related to the Baseband Chipset Business have been segregated from continuing operations and reported as discontinued operations.



	2013		2012		2011
Gain on sale of discontinued operations before income taxes	$	—	$	—	$	10,000
Provision for income taxes	—		—		3,500
Gain on sale of discontinued operations, net of tax	$	—	$	—	$	6,500