Available-for-Sale Debt and Equity Investments

12 Months Ended

Jul. 25, 2020

Investments, Debt and Equity Securities [Abstract]

Available-for-Sale Debt and Equity Investments

The following table summarizes our available-for-sale debt investments and equity investments (in millions):



	July 25, 2020		July 27, 2019
Available-for-sale debt investments	$	17,610	$	21,660
Marketable equity securities	—		3
Total investments	17,610		21,663
Non-marketable equity securities included in other assets	1,207		1,113
Equity method investments included in other assets	71		87
Total	$	18,888	$	22,863


(a)	Summary of Available-for-Sale Debt Investments

The following tables summarize our available-for-sale debt investments (in millions):



July 25, 2020	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. government securities	$	2,614	$	71	$	—		$	2,685
U.S. government agency securities	110		—		—			110
Corporate debt securities	11,549		334		(6		)	11,877
U.S. agency mortgage-backed securities	1,987		49		(1		)	2,035
Commercial paper	727		—		—			727
Certificates of deposit	176		—		—			176
Total	$	17,163	$	454	$	(7	)	$	17,610



July 27, 2019	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
U.S. government securities	$	808	$	1	$	(1	)	$	808
U.S. government agency securities	169		—		—			169
Corporate debt securities	19,188		103		(29		)	19,262
U.S. agency mortgage-backed securities	1,425		7		(11		)	1,421
Total	$	21,590	$	111	$	(41	)	$	21,660

The following table presents the gross realized gains and gross realized losses related to available-for-sale debt investments (in millions):



Years Ended	July 25, 2020			July 27, 2019			July 28, 2018
Gross realized gains	$	70		$	17		$	16
Gross realized losses	(28		)	(30		)	(258		)
Total	$	42		$	(13	)	$	(242	)

The following tables present the breakdown of the available-for-sale debt investments with gross unrealized losses and the duration that those losses had been unrealized at July 25, 2020 and July 27, 2019 (in millions):



	UNREALIZED LOSSES LESS THAN 12 MONTHS					UNREALIZED LOSSES 12 MONTHS OR GREATER				TOTAL
July 25, 2020	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
U.S. government agency securities	$	33	$	—		$	—	$	—	$	33	$	—
Corporate debt securities	1,060		(6		)	3		—		1,063		(6		)
U.S. agency mortgage-backed securities	265		(1		)	—		—		265		(1		)
Total	$	1,358	$	(7	)	$	3	$	—	$	1,361	$	(7	)



	UNREALIZED LOSSES LESS THAN 12 MONTHS					UNREALIZED LOSSES 12 MONTHS OR GREATER					TOTAL
July 27, 2019	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
U.S. government securities	$	204	$	—		$	488	$	(1	)	$	692	$	(1	)
U.S. government agency securities	—		—			169		—			169		—
Corporate debt securities	2,362		(4		)	5,271		(25		)	7,633		(29		)
U.S. agency mortgage-backed securities	123		—			847		(11		)	970		(11		)
Total	$	2,689	$	(4	)	$	6,775	$	(37	)	$	9,464	$	(41	)

As of July 25, 2020, for available-for-sale debt investments that were in an unrealized loss position, we have determined that no other-than-temporary impairments were required to be recognized.

The following table summarizes the maturities of our available-for-sale debt investments as of July 25, 2020 (in millions):



	Amortized Cost		Fair Value
Within 1 year	$	5,773	$	5,812
After 1 year through 5 years	7,360		7,532
After 5 years through 10 years	2,032		2,218
After 10 years	11		13
Mortgage-backed securities with no single maturity	1,987		2,035
Total	$	17,163	$	17,610

Actual maturities may differ from the contractual maturities because borrowers may have the right to call or prepay certain obligations.


(b)	Summary of Equity Investments

Gains and losses recognized on our marketable and non-marketable equity securities are summarized below (in millions):



	July 25, 2020			July 27, 2019
Net gains and losses recognized during the period on equity investments	$	63		$	58
Less: Net gains and losses recognized on equity investments sold	(76		)	(69		)
Net unrealized gains and losses recognized during reporting period on equity securities still held at the reporting date	$	(13	)	$	(11	)

We recorded adjustments to the carrying value of our non-marketable equity securities measured using the measurement alternative as follows (in millions):



	July 25, 2020			July 27, 2019
Adjustments to non-marketable equity securities measured using the measurement alternative:
Upward adjustments	$	28		$	26
Downward adjustments, including impairments	(41		)	(57		)
Net adjustments	$	(13	)	$	(31	)

As of July 25, 2020 and July 27, 2019, we held equity interests in certain private equity funds of $0.7 billion and $0.6 billion, respectively, which are accounted for under the NAV practical expedient.


(c)	Variable Interest Entities

In the ordinary course of business, we have investments in privately held companies and provide financing to certain customers. These privately held companies and customers are evaluated for consolidation under the variable interest or voting interest entity models. We evaluate on an ongoing basis our investments in these privately held companies and our customer financings, and have determined that as of July 25, 2020, there were no significant variable interest or voting interest entities required to be consolidated in our Consolidated Financial Statements.

As of July 25, 2020, the carrying value of our investments in privately held companies was $1.3 billion. $0.7 billion of such investments are considered to be in variable interest entities which are unconsolidated. We have total funding commitments of $0.3 billion related to these privately held investments, some of which may be based on the achievement of certain agreed-upon milestones, and some of which are required to be funded on demand. The carrying value of these investments and the additional funding commitments collectively represent our maximum exposure related to these privately held investments.