Balance Sheet Information
Investments
The following table summarizes, by major type, the fair value and amortized cost of the Company's investments as of June 28, 2013:
|
| | | | | | | | | | | |
(Dollars in millions) | Amortized Cost | | Unrealized Gain/(Loss) | | Fair Value |
Available-for-sale securities: | | | | | |
Money market funds | $ | 804 |
| | $ | — |
| | $ | 804 |
|
Commercial paper | 655 |
| | — |
| | 655 |
|
Corporate bonds | 211 |
| | — |
| | 211 |
|
U.S. treasuries and agency bonds | 96 |
| | — |
| | 96 |
|
Certificates of deposit | 154 |
| | — |
| | 154 |
|
Auction rate securities | 17 |
| | (2 | ) | | 15 |
|
Equity securities | 4 |
| | — |
| | 4 |
|
Other debt securities | 107 |
| | (1 | ) | | 106 |
|
| 2,048 |
| | (3 | ) | | 2,045 |
|
Trading securities | 74 |
| | 5 |
| | 79 |
|
Total | $ | 2,122 |
| | $ | 2 |
| | $ | 2,124 |
|
|
| | | | | | |
Included in Cash and cash equivalents | | | | $ | 1,528 |
|
Included in Short-term investments | | | | 480 |
|
Included in Restricted cash and investments | | | | 101 |
|
Included in Other assets, net | | | | 15 |
|
Total | | | | $ | 2,124 |
|
The Company's available-for-sale securities include investments in auction rate securities. Beginning in fiscal year 2008, the Company's auction rate securities failed to settle at auction and have continued to fail through June 28, 2013. Since the Company continues to earn interest on its auction rate securities at the maximum contractual rate, there have been no payment defaults with respect to such securities, and they are all collateralized, the Company expects to recover the entire amortized cost basis of these auction rate securities. The Company does not intend to sell these securities and has concluded it is not more likely than not that the Company will be required to sell the securities before the recovery of their amortized cost basis. As such, the Company believes the impairments totaling $2 million are not other-than-temporary and therefore have been recorded in Accumulated other comprehensive loss. Given the uncertainty as to when the liquidity issues associated with these securities will improve, these securities were classified within Other assets, net in the Company's Consolidated Balance Sheets.
As of June 28, 2013, the Company's Restricted cash and investments consisted of $79 million in cash equivalents and investments held in trust for payment of its non-qualified deferred compensation plan liabilities and $22 million in cash and investments held as collateral at banks for various performance obligations. As of June 29, 2012, the Company's Restricted cash and investments consisted of $73 million in cash and investments held in trust for payment of its non-qualified deferred compensation plan liabilities and $20 million in cash and investments held as collateral at banks for various performance obligations.
As of June 28, 2013, the Company had no material available-for-sale securities that had been in a continuous unrealized loss position for a period greater than 12 months. The Company determined no material available-for-sale securities were other-than-temporarily impaired as of June 28, 2013.
The fair value and amortized cost of the Company's investments classified as available-for-sale at June 28, 2013 by remaining contractual maturity was as follows:
|
| | | | | | | |
(Dollars in millions) | Amortized Cost | | Fair Value |
Due in less than 1 year | $ | 1,628 |
| | $ | 1,628 |
|
Due in 1 to 5 years | 399 |
| | 398 |
|
Thereafter | 17 |
| | 15 |
|
Total | $ | 2,044 |
| | $ | 2,041 |
|
Equity securities which do not have a contractual maturity date are not included in the above table.
The following table summarizes, by major type, the fair value and amortized cost of the Company's investments as of June 29, 2012:
|
| | | | | | | | | | | |
(Dollars in millions) | Amortized Cost | | Unrealized Gain/(Loss) | | Fair Value |
Available-for-sale securities: | | | | | |
Commercial paper | $ | 393 |
| | $ | — |
| | $ | 393 |
|
Money market funds | 1,158 |
| | — |
| | 1,158 |
|
U.S. treasuries and agency bonds | 98 |
| | 1 |
| | 99 |
|
Certificates of deposit | 6 |
| | — |
| | 6 |
|
Corporate bonds | 208 |
| | 1 |
| | 209 |
|
Auction rate securities | 17 |
| | (2 | ) | | 15 |
|
Other debt securities | 99 |
| | (1 | ) | | 98 |
|
| 1,979 |
| | (1 | ) | | 1,978 |
|
Trading securities | 73 |
| | — |
| | 73 |
|
Total | $ | 2,052 |
| | $ | (1 | ) | | $ | 2,051 |
|
|
| | | | | | | |
Included in Cash and cash equivalents | | | | | $ | 1,532 |
|
Included in Short-term investments | | | | | 411 |
|
Included in Restricted cash and investments | | | | | 93 |
|
Included in Other assets, net | | | | | 15 |
|
Total | | | | | $ | 2,051 |
|
As of June 29, 2012, with the exception of the Company's auction rate securities, the Company had no material available-for-sale securities that had been in a continuous unrealized loss position for a period greater than 12 months. The Company determined no material available-for-sale securities were other-than-temporarily impaired as of June 29, 2012.
Accounts Receivable, net
|
| | | | | | | |
(Dollars in millions) | June 28,
2013 | | June 29,
2012 |
Accounts receivable | $ | 1,678 |
| | $ | 2,329 |
|
Allowance for doubtful accounts | (8 | ) | | (10 | ) |
| $ | 1,670 |
| | $ | 2,319 |
|
Activity in the allowance for doubtful accounts is as follows:
|
| | | | | | | | | | | | | | | | | | | |
(Dollars in millions) | Balance at Beginning of Period | | Charges to Operations | | Deductions(1) | | Assumed from LaCie S.A. | | Balance at End of Period |
Fiscal year ended July 1, 2011 | $ | 10 |
| | $ | 1 |
| | $ | (1 | ) | | $ | — |
| | $ | 10 |
|
Fiscal year ended June 29, 2012 | $ | 10 |
| | $ | 3 |
| | $ | (3 | ) | | $ | — |
| | $ | 10 |
|
Fiscal year ended June 28, 2013 | $ | 10 |
| | $ | (2 | ) | | $ | (1 | ) | | $ | 1 |
| | $ | 8 |
|
___________________________________
| |
(1) | Uncollectible accounts written off, net of recoveries. |
Inventories
|
| | | | | | | |
(Dollars in millions) | June 28,
2013 | | June 29,
2012 |
Raw materials and components | $ | 213 |
| | $ | 265 |
|
Work-in-process | 231 |
| | 245 |
|
Finished goods | 410 |
| | 399 |
|
| $ | 854 |
| | $ | 909 |
|
Other Current Assets |
| | | | | | | |
(Dollars in millions) | June 28,
2013 | | June 29,
2012 |
Vendor non-trade receivables | $ | 329 |
| | $ | 601 |
|
Other | 155 |
| | 166 |
|
| $ | 484 |
| | $ | 767 |
|
Other current assets include non-trade receivables from certain manufacturing vendors resulting from the sale of components to these vendors who manufacture completed sub-assemblies or finished goods for the Company. The Company does not reflect the sale of these components in revenue and does not recognize any profits on these sales. The costs of the completed sub-assemblies are included in inventory upon purchase from the vendors.
Property, Equipment and Leasehold Improvements, net |
| | | | | | | | | |
(Dollars in millions) | Useful Life in Years | | June 28, 2013 | | June 29,
2012 |
Land and land improvements | | | $ | 44 |
| | $ | 29 |
|
Equipment | 3 – 5 | | 6,838 |
| | 6,495 |
|
Buildings and leasehold improvements | Up to 48 | | 1,401 |
| | 1,233 |
|
Construction in progress | | | 261 |
| | 263 |
|
| | | 8,544 |
| | 8,020 |
|
Less accumulated depreciation and amortization | | | (6,275 | ) | | (5,736 | ) |
| | | $ | 2,269 |
| | $ | 2,284 |
|
Depreciation expense, which includes amortization of leasehold improvements, was $727 million, $739 million and $748 million for fiscal years 2013, 2012, and 2011, respectively. Interest on borrowings related to eligible capital expenditures is capitalized as part of the cost of the qualified assets and amortized over the estimated useful lives of the assets. During fiscal years 2013, 2012, and 2011, the Company capitalized interest of $10 million, $4 million and $5 million, respectively.
