Financing Receivables and Operating Leases (Tables)

9 Months Ended

Apr. 27, 2019

A summary of our financing receivables is presented as follows (in millions):



April 27, 2019	Lease Receivables			Loan Receivables			Financed Service Contracts			Total
Gross	$	2,442		$	5,240		$	2,349		$	10,031
Residual value	152			—			—			152
Unearned income	(139		)	—			—			(139		)
Allowance for credit loss	(68		)	(77		)	(8		)	(153		)
Total, net	$	2,387		$	5,163		$	2,341		$	9,891
Reported as:
Current	$	1,033		$	2,632		$	1,364		$	5,029
Noncurrent	1,354			2,531			977			4,862
Total, net	$	2,387		$	5,163		$	2,341		$	9,891



July 28, 2018	Lease Receivables			Loan Receivables			Financed Service Contracts			Total
Gross	$	2,688		$	4,999		$	2,326		$	10,013
Residual value	164			—			—			164
Unearned income	(141		)	—			—			(141		)
Allowance for credit loss	(135		)	(60		)	(10		)	(205		)
Total, net	$	2,576		$	4,939		$	2,316		$	9,831
Reported as:
Current	$	1,249		$	2,376		$	1,324		$	4,949
Noncurrent	1,327			2,563			992			4,882
Total, net	$	2,576		$	4,939		$	2,316		$	9,831

Contractual Maturities of the Gross Lease Receivables

Future minimum lease payments to Cisco on lease receivables as of April 27, 2019 are summarized as follows (in millions):



Fiscal Year	Amount
2019 (remaining three months)	$	308
2020	984
2021	632
2022	341
2023	147
Thereafter	30
Total	$	2,442

Schedule of Internal Credit Risk Rating for Each Portfolio Segment and Class

Gross receivables, excluding residual value, less unearned income categorized by our internal credit risk rating as of April 27, 2019 and July 28, 2018 are summarized as follows (in millions):



	INTERNAL CREDIT RISK RATING
April 27, 2019	1 to 4		5 to 6		7 and Higher		Total
Lease receivables	$	1,235	$	1,029	$	39	$	2,303
Loan receivables	3,187		1,890		163		5,240
Financed service contracts	1,351		984		14		2,349
Total	$	5,773	$	3,903	$	216	$	9,892



	INTERNAL CREDIT RISK RATING
July 28, 2018	1 to 4		5 to 6		7 and Higher		Total
Lease receivables	$	1,294	$	1,199	$	54	$	2,547
Loan receivables	3,184		1,752		63		4,999
Financed service contracts	1,468		835		23		2,326
Total	$	5,946	$	3,786	$	140	$	9,872

Schedule of Financing Receivables by Portfolio Segment and Class Aging Analysis

The following tables present the aging analysis of gross receivables, excluding residual value and less unearned income as of April 27, 2019 and July 28, 2018 (in millions):



	DAYS PAST DUE (INCLUDES BILLED AND UNBILLED)
April 27, 2019	31-60		61-90		91+		Total Past Due		Current		Total		Nonaccrual Financing Receivables		Impaired Financing Receivables
Lease receivables	$	79	$	36	$	114	$	229	$	2,074	$	2,303	$	18	$	18
Loan receivables	108		81		255		444		4,796		5,240		30		30
Financed service contracts	75		113		471		659		1,690		2,349		4		4
Total	$	262	$	230	$	840	$	1,332	$	8,560	$	9,892	$	52	$	52



	DAYS PAST DUE (INCLUDES BILLED AND UNBILLED)
July 28, 2018	31-60		61-90		91+		Total Past Due		Current		Total		Nonaccrual Financing Receivables		Impaired Financing Receivables
Lease receivables	$	72	$	27	$	155	$	254	$	2,293	$	2,547	$	9	$	9
Loan receivables	104		55		252		411		4,588		4,999		30		30
Financed service contracts	138		78		304		520		1,806		2,326		3		3
Total	$	314	$	160	$	711	$	1,185	$	8,687	$	9,872	$	42	$	42

Allowance for Credit Loss and Related Financing Receivables

The allowances for credit loss and the related financing receivables are summarized as follows (in millions):



Three months ended April 27, 2019	CREDIT LOSS ALLOWANCES
	Lease Receivables			Loan Receivables		Financed Service Contracts			Total
Allowance for credit loss as of January 26, 2019	$	127		$	64	$	9		$	200
Provisions (benefits)	(41		)	13		27			(1		)
Recoveries (write-offs), net	2			—		(28		)	(26		)
Foreign exchange and other	(20		)	—		—			(20		)
Allowance for credit loss as of April 27, 2019	$	68		$	77	$	8		$	153



Nine months ended April 27, 2019	CREDIT LOSS ALLOWANCES
	Lease Receivables			Loan Receivables		Financed Service Contracts			Total
Allowance for credit loss as of July 28, 2018	$	135		$	60	$	10		$	205
Provisions (benefits)	(48		)	17		26			(5		)
Recoveries (write-offs), net	2			—		(28		)	(26		)
Foreign exchange and other	(21		)	—		—			(21		)
Allowance for credit loss as of April 27, 2019	$	68		$	77	$	8		$	153



Three months ended April 28, 2018	CREDIT LOSS ALLOWANCES
	Lease Receivables			Loan Receivables			Financed Service Contracts			Total
Allowance for credit loss as of January 27, 2018	$	165		$	94		$	13		$	272
Provisions (benefits)	1			(8		)	(1		)	(8		)
Foreign exchange and other	(1		)	(1		)	—			(2		)
Allowance for credit loss as of April 28, 2018	$	165		$	85		$	12		$	262



Nine months ended April 28, 2018	CREDIT LOSS ALLOWANCES
	Lease Receivables		Loan Receivables			Financed Service Contracts			Total
Allowance for credit loss as of July 29, 2017	$	162	$	103		$	30		$	295
Provisions (benefits)	2		(19		)	(17		)	(34		)
Foreign exchange and other	1		1			(1		)	1
Allowance for credit loss as of April 28, 2018	$	165	$	85		$	12		$	262

Schedule of Property Subject to or Available for Operating Lease

Amounts relating to equipment on operating lease assets and the associated accumulated depreciation are summarized as follows (in millions):



	April 27, 2019			July 28, 2018
Operating lease assets	$	562		$	356
Accumulated depreciation	(382		)	(238		)
Operating lease assets, net	$	180		$	118

Schedule of Future Minimum Rental Payments for Operating Leases

Minimum future rentals on noncancelable operating leases as of April 27, 2019 are summarized as follows (in millions):



Fiscal Year	Amount
2019 (remaining three months)	$	42
2020	120
2021	58
2022	12
Total	$	232