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FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

Mar. 29, 2020

Cash, Cash Equivalents, Investments, Restricted Cash and Investments and Other Assets Measured at Fair Value on Recurring Basis

The following table sets forth the Company’s cash, cash equivalents, investments, restricted cash and investments, and other assets measured at fair value on a recurring basis as of March 29, 2020, and June 30, 2019:



	March 29, 2020
										(Reported Within)
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Value		Cash and Cash Equivalents		Investments		Restricted Cash & Investments		Other Assets
	(in thousands)
Cash	$	1,486,663	$	—	$	—		$	1,486,663	$	1,482,536	$	—	$	4,127	$	—
Time deposit	1,735,157		—		—			1,735,157		1,485,129		—		250,028		—
Level 1:
Money market funds	944,788		—		—			944,788		944,788		—		—		—
U.S. Treasury and agencies	429,712		995		—			430,707		37,501		393,206		—		—
Mutual funds	68,757		3,354		(491		)	71,620		—		—		—		71,620
Level 1 Total	1,443,257		4,349		(491		)	1,447,115		982,289		393,206		—		71,620
Level 2:
Government-sponsored enterprises	2,011		1		—			2,012		—		2,012		—		—
Foreign government bonds	32,230		48		(47		)	32,231		—		32,231		—		—
Corporate notes and bonds	998,591		658		(6,280		)	992,969		11,632		981,337		—		—
Mortgage backed securities — residential	3,628		59		—			3,687		—		3,687		—		—
Mortgage backed securities — commercial	18,957		120		—			19,077		—		19,077		—		—
Level 2 Total	1,055,417		886		(6,327		)	1,049,976		11,632		1,038,344		—		—
Total	$	5,720,494	$	5,235	$	(6,818	)	$	5,718,911	$	3,961,586	$	1,431,550	$	254,155	$	71,620



	June 30, 2019
										(Reported Within)
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Value		Cash and Cash Equivalents		Investments		Restricted Cash & Investments		Other Assets
	(in thousands)
Cash	$	467,460	$	—	$	—		$	467,460	$	462,310	$	—	$	5,150	$	—
Time deposit	1,563,686		—		—			1,563,686		1,313,659		—		250,027		—
Level 1:
Money market funds	1,644,659		—		—			1,644,659		1,644,659		—		—		—
U.S. Treasury and agencies	465,655		283		(24		)	465,914		86,981		378,933		—		—
Mutual funds	76,961		1,063		(283		)	77,741		—		—		—		77,741
Level 1 Total	2,187,275		1,346		(307		)	2,188,314		1,731,640		378,933		—		77,741
Level 2:
Government-sponsored enterprises	16,005		5		(41		)	15,969		—		15,969		—		—
Foreign government bonds	24,408		35		—			24,443		—		24,443		—		—
Corporate notes and bonds	1,466,167		2,310		(99		)	1,468,378		150,610		1,317,768		—		—
Mortgage backed securities — residential	6,148		—		(4		)	6,144		—		6,144		—		—
Mortgage backed securities — commercial	29,587		140		—			29,727		—		29,727		—		—
Level 2 Total	1,542,315		2,490		(144		)	1,544,661		150,610		1,394,051		—		—
Total	$	5,760,736	$	3,836	$	(451	)	$	5,764,121	$	3,658,219	$	1,772,984	$	255,177	$	77,741

Schedule of Cash, Cash Equivalents, Investments and Restricted Cash and Investments in Unrealized Loss Positions

The following is an analysis of the Company’s cash, cash equivalents, investments, and restricted cash and investments in unrealized loss positions:



	March 29, 2020
	Unrealized Losses Less than 12 Months					Unrealized Losses 12 Months or Greater					Total
	Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss			Fair Value		Gross Unrealized Loss
	(in thousands)
Mutual funds	$	6,363	$	(193	)	$	8,108	$	(298	)	$	14,471	$	(491	)
Foreign government bonds	3,900		(47		)	—		—			3,900		(47		)
Corporate notes and bonds	676,318		(6,280		)	—		—			676,318		(6,280		)
	$	686,581	$	(6,520	)	$	8,108	$	(298	)	$	694,689	$	(6,818	)

Schedule of Amortized Cost and Fair Value of Cash Equivalents, Investments, Restricted Cash and Investments with Contractual Maturities

The amortized cost and fair value of cash equivalents, investments, and restricted investments with contractual maturities are as follows as of March 29, 2020:



	Cost		Estimated Fair Value
	(in thousands)
Due in one year or less	$	3,794,435	$	3,793,166
Due after one year through five years	349,695		346,732
Due in more than five years	20,944		20,730
	$	4,165,074	$	4,160,628

Schedule of Outstanding Foreign Currency Forward Contracts

As of March 29, 2020, the Company had the following outstanding foreign currency contracts that were entered into under its cash flow and balance sheet hedge programs:



	Notional Value
	Derivatives Designated as Hedging Instruments:				Derivatives Not Designated as Hedging Instruments:
	(in thousands)
	Buy Contracts		Sell Contracts		Buy Contracts		Sell Contracts
Japanese yen	$	—	$	190,470	$	28,759	$	—
Euro	80,061		—		42,354		—
Korean won	35,357		—		407		—
Taiwan dollar	—		—		46,686		—
Chinese renminbi	—		—		21,327		—
Swiss franc	—		—		16,360		—
Indian rupee	—		—		9,841		—
British pound sterling	—		—		8,263		—
Singapore dollar	—		—		5,529		—
	$	115,418	$	190,470	$	179,526	$	—

Schedule of Fair Value of Derivatives Instruments

The fair value of derivative instruments in the Company’s Condensed Consolidated Balance Sheet as of March 29, 2020, and June 30, 2019 were as follows:



	March 29, 2020						June 30, 2019
	Fair Value of Derivative Instruments (Level 2)						Fair Value of Derivative Instruments (Level 2)
	Derivative Assets			Derivative Liabilities			Derivative Assets			Derivative Liabilities
	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
	(in thousands)
Derivatives designated as hedging instruments:
Foreign exchange contracts	Prepaid expense and other assets	$	7,133	Accrued expenses and other current liabilities	$	3,538	Prepaid expense and other assets	$	119	Accrued expenses and other current liabilities	$	2,756
Interest rate contracts, short-term				Accrued expenses and other current liabilities	38,506					Accrued expenses and other current liabilities	5,149
Interest rate contracts, long-term	Other assets	—			—		Other assets	1,537			—

Derivatives not designated as hedging instruments:
Foreign exchange contracts	Prepaid expense and other assets	5		Accrued expenses and other current liabilities	234		Prepaid expense and other assets	1,249		Accrued expenses and other current liabilities	748
Total Derivatives		$	7,138		$	42,278		$	2,905		$	8,653

Schedule of Derivative Instruments Designated as Cash Flow Hedges in Statements of Operations

The effect of derivative instruments designated as cash flow hedges on the Company’s Condensed Consolidated Statements of Operations, including accumulated other comprehensive income (“AOCI”) was as follows:



		Three Months Ended						Nine Months Ended
		March 29, 2020						March 29, 2020
	Location of Gain or (Loss) Recognized in or Reclassified into Income	Gain (loss) Recognized in AOCI			Gain (Loss) Reclassified from AOCI into Income			Gain (Loss) Recognized in AOCI			Gain (Loss) Reclassified from AOCI into Income
Derivatives in Cash Flow Hedging Relationships		(in thousands)
Foreign Exchange Contracts	Revenue	$	6,334		$	1,279		$	9,532		$	773
Foreign Exchange Contracts	Cost of goods sold	(2,589		)	(186		)	(3,656		)	(2,086		)
Foreign Exchange Contracts	Selling, general, and administrative	(1,394		)	6			(1,859		)	(887		)
Interest Rate Contracts	Other (expense) income, net	(40,901		)	(36		)	(38,507		)	(106		)
		$	(38,550	)	$	1,063		$	(34,490	)	$	(2,306	)



		Three Months Ended						Nine Months Ended
		March 31, 2019						March 31, 2019
	Location of Gain or (Loss) Recognized in or Reclassified into Income	(Loss) Gain Recognized in AOCI			Gain (Loss) Reclassified from AOCI into Income			Gain (Loss) Recognized in AOCI			Gain (Loss) Reclassified from AOCI into Income
Derivatives in Cash Flow Hedging Relationships		(in thousands)
Foreign Exchange Contracts	Revenue	$	(7,203	)	$	206		$	9,467		$	8,693
Foreign Exchange Contracts	Cost of goods sold	(1,395		)	(2,097		)	(3,484		)	(4,505		)
Foreign Exchange Contracts	Selling, general, and administrative	(475		)	(600		)	(1,353		)	(1,778		)
Interest Rate Contracts	Other (expense) income, net	—			(34		)	—			(100		)
		$	(9,073	)	$	(2,525	)	$	4,630		$	2,310

The effect of derivative instruments not designated as cash flow hedges on the Company’s Condensed Consolidated Statements of Operations was as follows:



		Three Months Ended						Nine Months Ended
		March 29, 2020			March 31, 2019			March 29, 2020			March 31, 2019
Derivatives Not Designated as Hedging Instruments:	Location of Gain (Loss) Recognized in Income	Loss Recognized in Income			Loss Recognized in Income			Loss Recognized in Income			Gain Recognized in Income
		(in thousands)
Foreign Exchange Contracts	Other (expense) income, net	$	(6,858	)	$	(6,747	)	$	(8,788	)	$	4,142

The following table presents the effect of the fair value cash flow hedge accounting on the Statement of Financial Performance as well as presents the location and amount of gain/(loss) recognized in Income on fair value and cash flow hedging relationships:



	Three Months Ended										Nine Months Ended
	March 29, 2020										March 29, 2020
	Revenue		Cost of Goods Sold			Selling, General and Admini-strative		Other (Expense) Income, Net			Revenue		Cost of Goods Sold			Selling, General and Admini-strative			Other (Expense) Income, Net
	(in thousands)
Total amounts of income and expense line items presented in the statement of financial performance in which the effects of fair value or cash flow hedges are recorded:
	$	2,503,625	$1,336,618			$	164,979	$	(64,619	)	$	7,252,872	$	3,924,511		$	496,679		$	(91,271	)

The effects of fair value and cash flow hedging:
Gain or (loss) on fair value hedging relationships in Subtopic 815-20:
Interest contracts:
Hedged items	$	—	$	—		$	—	$	(7,789	)	$	—	$	—		$	—		$	(12,862	)
Derivatives designated as hedging instruments	$	—	$	—		$	—	$	7,789		$	—	$	—		$	—		$	12,862

Gain or (loss) on cash flow hedging relationships in Subtopic 815-20:
Foreign exchange contracts:
Amount of gain (loss) reclassified from accumulated other comprehensive income into income	$	1,279	$	(186	)	$	6	$	—		$	773	$	(2,086	)	$	(887	)	$	—
Interest rate contracts:
Amount of loss reclassified from accumulated other comprehensive income into income	$	—	$	—		$	—	$	(36	)	$	—	$	—		$	—		$	(106	)