Goodwill and Intangible Assets

12 Months Ended

Oct. 29, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets

As of October 29, 2023, our reporting units include Semiconductor Products Group and Imaging and Process Control Group, which combine to form the Semiconductor Systems reporting segment, Applied Global Services, Display and Adjacent Markets and other reporting units recorded under Corporate and Other.

Our methodology for allocating the purchase price relating to purchase acquisitions is determined through established and generally accepted valuation techniques. Goodwill is measured as the excess of the purchase price over the sum of the amounts assigned to tangible and identifiable intangible assets acquired less liabilities assumed. We assign assets acquired (including goodwill) and liabilities assumed to one or more reporting units as of the date of acquisition. Typically, acquisitions relate to a single reporting unit and thus do not require the allocation of goodwill to multiple reporting units. If the products obtained in an acquisition are assigned to multiple reporting units, the goodwill is distributed to the respective reporting units as part of the purchase price allocation process.

Goodwill

In the fourth quarter of fiscal 2023, we performed a qualitative assessment to test goodwill for all of our reporting units for impairment. We determined that it was more likely than not that each of our reporting units’ fair values exceeded their respective carrying values and that it was not necessary to perform the quantitative goodwill impairment test for any of our reporting units. The evaluation of goodwill and intangible assets for impairment requires the exercise of significant judgment. In the event of future changes in business conditions, we will be required to reassess and update our forecasts and estimates used in future impairment analyses. If the results of these future analyses are lower than current estimates, a material impairment charge may result at that time.

Details of goodwill as of October 29, 2023 and October 30, 2022 were as follows:

	October 29, 2023		October 30, 2022
	(In millions)
Goodwill by reportable segment
Semiconductor Systems	$	2,460	$	2,428
Applied Global Services	1,032		1,032
Display and Adjacent Markets	199		199
Corporate and Other	41		41
	$	3,732	$	3,700

From time to time, we acquire companies related to our existing or new markets. During fiscal 2023, goodwill increased primarily due to the preliminary purchase accounting for acquisitions, net of adjustments, which were not material to our results of operations or to our balance sheet.

Intangible Assets

Details of intangible assets other than goodwill were as follows:

 

	October 29, 2023						October 30, 2022
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
	(In millions)
Intangible assets with finite lives:
Semiconductor Systems Group	$	2,001	$	(1,714)	$	287	$	1,985	$	(1,675)	$	310
Applied Global Services	79		(78)		1		79		(77)		2
Display and Adjacent Markets	194		(194)		—		194		(194)		—
Corporate & Other	36		(30)		6		36		(26)		10
Total intangible assets with finite lives	$	2,310	$	(2,016)	$	294	$	2,294	$	(1,972)	$	322
Intangible assets with infinite lives:
Semiconductor Systems Group	$	—	$	—	$	—	$	16	$	—	$	16
Corporate & Other	—		—		—		1		—		1
Total intangible assets with infinite lives	$	—	$	—	$	—	$	17	$	—	$	17
Total intangible assets	$	2,310	$	(2,016)	$	294	$	2,311	$	(1,972)	$	339

The increase in intangible assets with finite lives during fiscal 2023 was primarily due to the preliminary purchase accounting for acquisitions during fiscal 2023, which were not material to our results of operations.

Amortization expense of intangible assets was $44 million, $40 million and $49 million during fiscal 2023, 2022 and 2021, respectively.

As of October 29, 2023, future estimated amortization expense of intangible assets with finite lives is expected to be as follows: 

	Amortization Expense
	(In millions)
2024	$	43
2025	41
2026	39
2027	26
2028	23
Thereafter	122
Total	$	294