Cover page
Cover page - shares | 3 Months Ended | |
Sep. 30, 2022 | Oct. 24, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-31560 | |
Entity Incorporation, State or Country Code | L2 | |
Entity Tax Identification Number | 98-1597419 | |
Entity Address, Address Line One | 38/39 Fitzwilliam Square | |
Entity Address, City or Town | Dublin 2 | |
Entity Address, Country | IE | |
Entity Address, Postal Zip Code | D02 NX53 | |
City Area Code | (353) (1) | |
Local Phone Number | 234-3136 | |
Title of 12(b) Security | Ordinary Shares, par value $0.00001 per share | |
Trading Symbol | STX | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Smaller Reporting Company | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 206,454,363 | |
Entity Registrant Name | Seagate Technology Holdings plc | |
Entity Central Index Key | 0001137789 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --06-30 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2022 | Jul. 01, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 761,000,000 | $ 615,000,000 |
Accounts receivable, net | 1,098,000,000 | 1,532,000,000 |
Inventories | 1,606,000,000 | 1,565,000,000 |
Other current assets | 275,000,000 | 321,000,000 |
Total current assets | 3,740,000,000 | 4,033,000,000 |
Property, equipment and leasehold improvements, net | 2,196,000,000 | 2,239,000,000 |
Goodwill | 1,237,000,000 | 1,237,000,000 |
Other intangible assets, net | 5,000,000 | 9,000,000 |
Deferred income taxes | 1,137,000,000 | 1,132,000,000 |
Other assets, net | 296,000,000 | 294,000,000 |
Total Assets | 8,611,000,000 | 8,944,000,000 |
Current liabilities: | ||
Accounts payable | 1,712,000,000 | 2,058,000,000 |
Accrued employee compensation | 106,000,000 | 252,000,000 |
Accrued warranty | 66,000,000 | 65,000,000 |
Current portion of long-term debt | 636,000,000 | 584,000,000 |
Accrued expenses | 618,000,000 | 596,000,000 |
Total current liabilities | 3,138,000,000 | 3,555,000,000 |
Long-term accrued warranty | 83,000,000 | 83,000,000 |
Other non-current liabilities | 128,000,000 | 135,000,000 |
Long-term debt, less current portion | 5,613,000,000 | 5,062,000,000 |
Total Liabilities | 8,962,000,000 | 8,835,000,000 |
Shareholders’ (Deficit) Equity: | ||
Ordinary shares and additional paid-in capital | 7,248,000,000 | 7,190,000,000 |
Accumulated other comprehensive income | 73,000,000 | 36,000,000 |
Accumulated deficit | (7,672,000,000) | (7,117,000,000) |
Total Shareholders’ (Deficit) Equity | (351,000,000) | 109,000,000 |
Total Liabilities and Shareholders’ (Deficit) Equity | $ 8,611,000,000 | $ 8,944,000,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Income Statement [Abstract] | ||
Revenue | $ 2,035 | $ 3,115 |
Cost of revenue | 1,553 | 2,159 |
Product development | 234 | 233 |
Marketing and administrative | 129 | 133 |
Amortization of intangibles | 3 | 3 |
Restructuring and other, net | 9 | 1 |
Total operating expenses | 1,928 | 2,529 |
Income from operations | 107 | 586 |
Interest income | 1 | 0 |
Interest expense | (71) | (59) |
Other, net | (10) | 6 |
Other expense, net | (80) | (53) |
Income before income taxes | 27 | 533 |
(Benefit from) provision for income taxes | (2) | 7 |
Net income | $ 29 | $ 526 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.14 | $ 2.33 |
Diluted (in dollars per share) | $ 0.14 | $ 2.28 |
Number of shares used in per share calculations: | ||
Basic (in shares) | 208 | 226 |
Diluted (in shares) | 210 | 231 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Net income | $ 29 | $ 526 |
Change in net unrealized gains (losses) on cash flow hedges: | ||
Net change | 37 | (6) |
Change in unrealized components of post-retirement plans: | ||
Net change | 1 | 2 |
Foreign currency translation adjustments | ||
Foreign currency translation adjustments | (1) | 0 |
Total other comprehensive income (loss), net of tax | 37 | (4) |
Comprehensive income | 66 | 522 |
Unrealized Gains/(Losses) on Cash Flow Hedges | ||
Change in net unrealized gains (losses) on cash flow hedges: | ||
Net unrealized gains (losses) arising during the period | 32 | (9) |
Losses reclassified into earnings | (5) | (3) |
Net change | 37 | (6) |
Unrealized Gains/(Losses) on Post-Retirement Plans | ||
Change in unrealized components of post-retirement plans: | ||
Net unrealized gains arising during the period | 1 | 1 |
Losses reclassified into earnings | 0 | 1 |
Net change | $ (1) | $ (2) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
OPERATING ACTIVITIES | ||
Net income | $ 29 | $ 526 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 135 | 104 |
Share-based compensation | 29 | 34 |
Deferred income taxes | (5) | (4) |
Other non-cash operating activities, net | 13 | 2 |
Changes in operating assets and liabilities: | ||
Accounts receivable, net | 434 | (143) |
Inventories | (41) | 16 |
Accounts payable | (300) | 28 |
Accrued employee compensation | (146) | (92) |
Accrued expenses, income taxes and warranty | 4 | 11 |
Other assets and liabilities | 93 | 14 |
Net cash provided by operating activities | 245 | 496 |
INVESTING ACTIVITIES | ||
Acquisition of property, equipment and leasehold improvements | (133) | (117) |
Proceeds from the sale of assets | 1 | 0 |
Purchases of investments | (1) | (18) |
Proceeds from sale of investments | 0 | 15 |
Net cash used in investing activities | (133) | (120) |
FINANCING ACTIVITIES | ||
Redemption and repurchase of debt | 0 | (6) |
Dividends to shareholders | (147) | (153) |
Repurchases of ordinary shares | (408) | (425) |
Taxes paid related to net share settlement of equity awards | (39) | (43) |
Proceeds from issuance of long-term debt | 600 | 0 |
Proceeds from issuance of ordinary shares under employee stock plans | 29 | 33 |
Other financing activities, net | (1) | 0 |
Net cash provided by (used in) financing activities | 34 | (594) |
Increase (decrease) in cash, cash equivalents and restricted cash | 146 | (218) |
Cash, cash equivalents and restricted cash at the beginning of the period | 617 | 1,211 |
Cash, cash equivalents and restricted cash at the end of the period | $ 763 | $ 993 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY - USD ($) shares in Millions, $ in Millions | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Accumulated Deficit |
Beginning balance (in shares) at Jul. 02, 2021 | 227 | ||||
Beginning balance at Jul. 02, 2021 | $ 631 | $ 0 | $ 6,977 | $ (41) | $ (6,305) |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 526 | 526 | |||
Other comprehensive income | (4) | (4) | |||
Issuance of ordinary shares under employee stock plans (In shares) | 3 | ||||
Issuance of ordinary shares under employee share plans | 33 | 33 | |||
Repurchases of ordinary shares (in shares) | (5) | ||||
Repurchases of ordinary shares | (425) | (425) | |||
Tax withholding related to vesting of restricted stock units (in shares) | 0 | ||||
Tax withholding related to vesting of restricted share units | (43) | (43) | |||
Dividends to shareholders ($0.67 per ordinary share) | (151) | (151) | |||
Share-based compensation | 34 | 34 | |||
Ending balance (in shares) at Oct. 01, 2021 | 225 | ||||
Ending balance at Oct. 01, 2021 | 601 | $ 0 | 7,044 | (45) | (6,398) |
Beginning balance (in shares) at Jul. 01, 2022 | 210 | ||||
Beginning balance at Jul. 01, 2022 | 109 | $ 0 | 7,190 | 36 | (7,117) |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 29 | 29 | |||
Other comprehensive income | 37 | 37 | |||
Issuance of ordinary shares under employee stock plans (In shares) | 2 | ||||
Issuance of ordinary shares under employee share plans | $ 29 | 29 | |||
Repurchases of ordinary shares (in shares) | (5) | (5) | |||
Repurchases of ordinary shares | $ (400) | (400) | |||
Tax withholding related to vesting of restricted stock units (in shares) | (1) | (1) | |||
Tax withholding related to vesting of restricted share units | $ (39) | (39) | |||
Dividends to shareholders ($0.67 per ordinary share) | (145) | (145) | |||
Share-based compensation | 29 | 29 | |||
Ending balance (in shares) at Sep. 30, 2022 | 206 | ||||
Ending balance at Sep. 30, 2022 | $ (351) | $ 0 | $ 7,248 | $ 73 | $ (7,672) |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Summary of Significant Accounting Policies | Basis of Presentation and Summary of Significant Accounting Policies Organization Seagate Technology Holdings plc (“STX”) and its subsidiaries (collectively, unless the context otherwise indicates, the “Company”) is a leading provider of data storage technology and infrastructure solutions. Its principal products are hard disk drives, commonly referred to as disk drives, hard drives or HDDs. In addition to HDDs, the Company produces a broad range of data storage products including solid state drives (“SSDs”), solid state hybrid drives (“SSHDs”), storage subsystems, as well as a scalable edge-to-cloud mass data platform that includes data transfer shuttles and a storage-as-a-service cloud. HDDs are devices that store digitally encoded data on rapidly rotating disks with magnetic surfaces. HDDs continue to be the primary medium of mass data storage due to their performance attributes, reliability, high capacities, superior quality and cost effectiveness. Complementing existing storage architectures, SSDs use integrated circuit assemblies as memory to store data, and most SSDs use NAND flash memory. In contrast to HDDs and SSDs, SSHDs combine the features of SSDs and HDDs in the same unit, containing a high-capacity HDD and a smaller SSD acting as a cache to improve performance. The Company’s HDD products are designed for mass capacity storage and legacy markets. Mass capacity storage involves well-established use cases—such as hyperscale data centers and public clouds as well as emerging use cases. Legacy markets include markets the Company continues to sell to but that it does not plan to invest in significantly. The Company’s HDD and SSD product portfolio includes Serial Advanced Technology Attachment, Serial Attached SCSI and Non-Volatile Memory Express based designs to support a wide variety of mass capacity and legacy applications. The Company’s systems portfolio includes storage subsystems for enterprises, cloud service providers, scale-out storage servers and original equipment manufacturers (“OEMs”). Engineered for modularity, mobility, capacity and performance, these solutions include the Company’s enterprise HDDs and SSDs, enabling customers to integrate powerful, scalable storage within existing environments or create new ecosystems from the ground up in a secure, cost-effective manner. The Company’s Lyve portfolio provides a simple, cost-efficient and secure way to manage massive volumes of data across the distributed enterprise. The Lyve platform includes a shuttle solution that enables enterprises to transfer massive amounts of data from endpoints to the core cloud, a storage-as-a-service cloud offering that provides frictionless mass capacity storage at the metro edge. Basis of Presentation and Consolidation The unaudited Condensed Consolidated Financial Statements of the Company and the accompanying notes were prepared in accordance with United States (“U.S.”) Generally Accepted Accounting Principles (“GAAP”). The Company’s unaudited condensed consolidated financial statements include the accounts of the Company and all its wholly-owned and majority-owned subsidiaries, after elimination of intercompany transactions and balances. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s condensed consolidated financial statements and accompanying notes. These estimates and assumptions include the impact of the COVID-19 pandemic. Actual results could differ materially from those estimates. The methods, estimates and judgments the Company uses in applying its most critical accounting policies have a significant impact on the results the Company reports in its condensed consolidated financial statements. The Company’s consolidated financial statements for the fiscal year ended July 1, 2022 are included in its Annual Report on Form 10-K, as filed with the U.S. Securities and Exchange Commission (“SEC”) on August 5, 2022. The Company believes that the disclosures included in these unaudited condensed consolidated financial statements, when read in conjunction with its consolidated financial statements as of July 1, 2022, and the notes thereto, are adequate to make the information presented not misleading. The results of operations and the cash flows for the three months ended September 30, 2022 are not necessarily indicative of the results to be expected for any subsequent interim period or for the Company’s fiscal year ending June 30, 2023. Fiscal Year The Company operates and reports financial results on a fiscal year of 52 or 53 weeks ending on the Friday closest to June 30. In fiscal years with 53 weeks, the first quarter consists of 14 weeks and the remaining quarters consist of 13 weeks each. The three months ended September 30, 2022 and October 1, 2021 consisted of 13 weeks. Fiscal years 2023 and 2022 both comprise of 52 weeks and end on June 30, 2023 and July 1, 2022, respectively. The fiscal quarters ended September 30, 2022, July 1, 2022 and October 1, 2021, are also referred to herein as the “September 2022 quarter”, the “June 2022 quarter” and the “September 2021 quarter”, respectively. Summary of Significant Accounting Policies There have been no material changes to the Company’s significant accounting policies disclosed in Note 1. Basis of Presentation and Summary of Significant Accounting Policies of “Financial Statements and Supplementary Data” contained in Part II, Item 8. of the Company’s Annual Report on Form 10-K for the fiscal year ended July 1, 2022, as filed with the SEC on August 5, 2022. Recently Adopted Accounting Pronouncements In March 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04 (ASC Topic 848), Reference Rate Reform. This ASU provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. The Company adopted the guidance in the quarter ended September 30, 2022 on a prospective basis and is transitioning from an interest rate based on London Interbank Offered Rate (“LIBOR”) to Secured Overnight Financing Rate (“SOFR”). The adoption of this ASU did not have a material impact on the Company’s condensed consolidated financial statements. In November 2021, the FASB issued ASU 2021-10 (ASC Topic 832), Disclosures by Business Entities about Government Assistance . This ASU requires annual disclosures that increase the transparency of transactions involving government grants, including (1) the type of transactions, (2) the accounting for those transactions and (3) the effect of those transactions on an entity’s financial statements. The Company adopted the guidance in the quarter ended September 30, 2022. Recently Issued Accounting Pronouncements In September 2022, the FASB issued ASU 2022-04 (ASC Subtopic 405-50), Disclosure of Supplier Finance Program Obligations . This ASU requires disclosure of key terms of the outstanding supplier finance programs and a rollforward of the related obligations. The Company is required to adopt this guidance in the first quarter of fiscal year 2024. Early adoption is permitted. The Company is in the process of assessing the impact of this ASU on its condensed consolidated financial statements. In June 2022, the FASB issued ASU 2022-03 (ASC Topic 820), Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions . This ASU clarifies that a contractual restriction on the sale of equity security is not considered when measuring its fair value and requires new disclosures for equity securities subject to contractual sale restriction. The Company is required to adopt this guidance in the first quarter of fiscal year 2025. The Company does not expect the adoption of this ASU to have a material impact on its condensed consolidated financial statements. |
Balance Sheet Information
Balance Sheet Information | 3 Months Ended |
Sep. 30, 2022 | |
Disclosure Text Block Supplement [Abstract] | |
Balance Sheet Information | Balance Sheet Information Available-for-sale Debt Securities The following table summarizes, by major type, the fair value and amortized cost of the Company’s available-for-sale debt investments as of September 30, 2022 and July 1, 2022: September 30, July 1, (Dollars in millions) Amortized Cost Unrealized Gain/(Loss) Fair Value Amortized Cost Unrealized Gain/(Loss) Fair Value Available-for-sale debt securities: Money market funds $ 159 $ — $ 159 $ 60 $ — $ 60 Time deposits and certificates of deposit 1 — 1 1 — 1 Other debt securities 16 — 16 23 — 23 Total $ 176 $ — $ 176 $ 84 $ — $ 84 Included in Cash and cash equivalents $ 158 $ 59 Included in Other current assets 2 2 Included in Other assets, net 16 23 Total $ 176 $ 84 As of September 30, 2022 and July 1, 2022, the Company’s Other current assets included $2 million in restricted cash equivalents held as collateral at banks for various performance obligations. As of September 30, 2022 and July 1, 2022, the Company had no material available-for-sale debt securities that had been in a continuous unrealized loss position for a period greater than 12 months. The Company determined no impairment related to credit losses for available-for-sale debt securities as of September 30, 2022. The fair value and amortized cost of the Company’s investments classified as available-for-sale debt securities as of September 30, 2022, by remaining contractual maturity were as follows: (Dollars in millions) Amortized Cost Fair Value Due in less than 1 year $ 160 $ 160 Due in 1 to 5 years 15 15 Due in 6 to 10 years — — Thereafter 1 1 Total $ 176 $ 176 Cash, Cash Equivalents and Restricted Cash The following table provides a summary of cash, cash equivalents and restricted cash reported within the Company’s Condensed Consolidated Balance Sheets that reconciles to the corresponding amount in the Company’s Condensed Consolidated Statements of Cash Flows: (Dollars in millions) September 30, July 1, October 1, July 2, Cash and cash equivalents $ 761 $ 615 $ 991 $ 1,209 Restricted cash included in Other current assets 2 2 2 2 Total cash, cash equivalents and restricted cash shown in the Statements of Cash Flows $ 763 $ 617 $ 993 $ 1,211 Accounts receivable, net In connection with an existing factoring agreement, from time to time the Company sells trade receivables to a third party for cash proceeds less a discount. During the three months ended September 30, 2022, the Company sold trade receivables without recourse for cash proceeds of $200 million. As of September 30, 2022, the total amount that remained subject to servicing by the Company was $237 million. The discounts on receivables sold were not material for the three months ended September 30, 2022. During the three months ended October 1, 2021, the Company did not sell any trade receivables to a third party. Inventories The following table provides details of the inventory balance sheet item: (Dollars in millions) September 30, July 1, Raw materials and components $ 648 $ 601 Work-in-process 402 414 Finished goods 556 550 Total inventories $ 1,606 $ 1,565 Property, Equipment and Leasehold Improvements, net The components of property, equipment and leasehold improvements, net, were as follows: (Dollars in millions) September 30, July 1, Property, equipment and leasehold improvements $ 10,699 $ 10,659 Accumulated depreciation and amortization (8,503) (8,420) Property, equipment and leasehold improvements, net $ 2,196 $ 2,239 Accrued Expenses The following table provides details of the accrued expenses balance sheet item: (Dollars in millions) September 30, July 1, Dividends payable $ 145 $ 147 Other accrued expenses 473 449 Total $ 618 $ 596 Accumulated Other Comprehensive Income (Loss) (“AOCI”) The components of AOCI, net of tax, were as follows: (Dollars in millions) Unrealized Gains/(Losses) on Cash Flow Hedges Unrealized Gains/(Losses) on Post-Retirement Plans Foreign Currency Translation Adjustments Total Balance at July 1, 2022 $ 51 $ (14) $ (1) $ 36 Other comprehensive income before reclassifications 32 1 — 33 Amounts reclassified from AOCI 5 — (1) 4 Other comprehensive income 37 1 (1) 37 Balance at September 30, 2022 $ 88 $ (13) $ (2) $ 73 Balance at July 2, 2021 $ (18) $ (22) $ (1) $ (41) Other comprehensive (loss) income before reclassifications (9) 1 — (8) Amounts reclassified from AOCI 3 1 — 4 Other comprehensive loss (6) 2 — (4) Balance at October 1, 2021 $ (24) $ (20) $ (1) $ (45) |
Debt
Debt | 3 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Debt | Debt The following table provides details of the Company’s debt as of September 30, 2022 and July 1, 2022: (Dollars in millions) September 30, July 1, Unsecured Senior Notes (1) $1,000 issued on May 22, 2013 at 4.75% due June 1, 2023 (the “2023 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. $ 540 $ 540 $500 issued on February 3, 2017 at 4.875% due March 1, 2024 (the “2024 Notes”) , interest payable semi-annually on March 1 and September 1 of each year. 499 499 $1,000 issued on May 28, 2014 at 4.75% due January 1, 2025 (the “2025 Notes”) , interest payable semi-annually on January 1 and July 1 of each year. 479 479 $700 issued on May 14, 2015 at 4.875% due June 1, 2027 (the “2027 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. 504 504 $500 issued on June 18, 2020 at 4.091% due June 1, 2029 (the “June 2029 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. 468 466 $500 issued on December 8, 2020 at 3.125% due July 15, 2029 (the “July 2029 Notes”) , interest payable semi-annually on January 15 and July 15 of each year. 500 500 $500 issued on June 10, 2020 at 4.125% due January 15, 2031 (the “January 2031 Notes”) , interest payable semi-annually on January 15 and July 15 of each year. 500 500 $500 issued on December 8, 2020 at 3.375% due July 15, 2031 (the “July 2031 Notes”) , interest payable semi-annually on January 15 and July 15 of each year. 500 500 $500 issued on December 2, 2014 at 5.75% due December 1, 2034 (the “2034 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. 489 489 Term Loans $600 borrowed on October 14, 2021 at SOFR plus a variable margin ranging from 1.125% to 2.375%, (the “Term Loan A1”) , repayable in quarterly installments beginning on December 31, 2022, with a final maturity date of September 16, 2025. 600 600 $600 borrowed on October 14, 2021 at SOFR plus a variable margin ranging from 1.25% to 2.5%, (the “Term Loan A2”) , repayable in quarterly installments beginning on December 31, 2022, with a final maturity date of July 30, 2027. 600 600 $600 borrowed on August 18, 2022 at SOFR plus a variable margin ranging from 1.25% to 2.5%, ( the “ Term Loan A3 ”), repayable in quarterly installments beginning on December 31, 2022, with a final maturity date of July 30, 2027. 600 — 6,279 5,677 Less: unamortized debt issuance costs (30) (31) Debt, net of debt issuance costs 6,249 5,646 Less: current portion of long-term debt (636) (584) Long-term debt, less current portion $ 5,613 $ 5,062 __________________________________ (1) All unsecured senior notes are issued by Seagate HDD Cayman, and the obligations under these notes are fully and unconditionally guaranteed, on a senior unsecured basis, by Seagate Technology Unlimited Company (“STUC”) and, pursuant to a supplemental indenture dated as of May 18, 2021, STX. Credit Agreement The Company’s subsidiary, Seagate HDD Cayman, has a credit agreement, which was most recently amended on August 18, 2022 (the “Credit Agreement”). Prior to the August 18, 2022 amendment, the Credit Agreement provided a term loan facility in an aggregate principal amount of $1.2 billion that was extended in two tranches of $600 million each for Term Loans A1 and A2 and a $1.75 billion senior unsecured revolving credit facility (“Revolving Credit Facility”). Term Loans A1 and A2 were drawn in full on October 14, 2021. On August 18, 2022, Seagate Technology Holdings plc and Seagate HDD Cayman (the “Borrower”) entered into an amendment to the Credit Agreement (the “Sixth Amendment”), which provides for a new term loan facility in the aggregate principal amount of $600 million (“Term Loan A3”). Term Loan A3 was borrowed in full at the closing of the Sixth Amendment. Term Loan A3 bears interest at a rate of SOFR plus a variable margin of 1.25% to 2.5%, in each case with such margin being determined based on the corporate credit rating of the Borrower or one of its parent entities. Term Loan A3 is repayable in quarterly installments beginning on December 31, 2022 and is scheduled to mature on July 30, 2027. The Sixth Amendment to the Credit Agreement also replaced the LIBOR interest rates plus variable margin for the Term Loans A1 and A2 with the SOFR interest rates plus a variable margin that will be determined based on the corporate credit rating of the Borrower or one of its parent entities. The Sixth Amendment also permits the Borrower to increase the revolving loan commitments or obtain new term loans of up to $100 million in aggregate, subject to the satisfaction of certain terms and conditions. STX and certain of its material subsidiaries, including STUC, fully and unconditionally guarantee both the Revolving Credit Facility and the Term Loans A1, A2 and A3 (the “Term Loans”). The Credit Agreement includes three financial covenants: (1) interest coverage ratio, (2) total leverage ratio and (3) a minimum liquidity amount. The Company was in compliance with the covenants as of September 30, 2022. As of September 30, 2022, no borrowings (including swingline loans) were outstanding and no commitments were utilized for letters of credit issued under the Revolving Credit Facility. Future Principal Payments on Long-term Debt At September 30, 2022, future principal payments on long-term debt were as follows (in millions): Fiscal Year Amount Remainder of 2023 $ 608 2024 614 2025 627 2026 629 2027 649 Thereafter 3,188 Total $ 6,315 |
Income Taxes
Income Taxes | 3 Months Ended |
Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company recorded an income tax benefit o f $2 million for the three months ended September 30, 2022. The income tax benefit included approximately $7 million of net discrete tax benefit, primarily associated with the excess tax benefits related to share-based compensation expense. During the three months ended September 30, 2022 , the Company’s unrecognized tax benefits excluding interest and penalties increased by approximately $1 million to $115 million , substantially all of which would impact the effective tax rate, if recognized, subject to certain future valuation allowance reversals. The Company is not expecting material changes to its unrecognized tax benefits in the next twelve months beginning October 1, 2022. The Company’s income tax provision of $7 million for the three months ended October 1, 2021 included approximately $10 million of net discrete tax benefit, primarily associated with net excess tax benefits related to share-based compensation expense. The Company’s income tax provision recorded for the three months ended September 30, 2022 and October 1, 2021 differed from the provision for income taxes that would be derived by applying the Irish statutory rate of 25% to income before income taxes, primarily due to the net effect of tax benefits related to (i) non-Irish earnings generated in jurisdictions that are subject to tax incentive programs and are considered indefinitely reinvested outside of Ireland and (ii) current year generation of research credits. |
Restructuring and Exit Costs
Restructuring and Exit Costs | 3 Months Ended |
Sep. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Exit Costs | Restructuring and Exit Costs The Company recorded restructuring charges of $9 million and $1 million, for the three months ended September 30, 2022 and October 1, 2021 respectively. The Company’s restructuring plans are comprised primarily of charges related to workforce reduction costs and facilities and other exit costs. All restructuring charges are reported in Restructuring and other, net on the Company’s Condensed Consolidated Statements of Operations. The following tables summarize the Company’s restructuring activities under the Company’s active restructuring plans: (Dollars in millions) Workforce Reduction Costs Facilities and Other Exit Costs Total Accrual balances at July 1, 2022 $ — $ 5 $ 5 Restructuring charges 9 — 9 Cash payments (3) (1) (4) Accrual balances at September 30, 2022 $ 6 $ 4 $ 10 Total costs incurred inception to date as of September 30, 2022 $ 72 $ 24 $ 96 Total expected charges to be incurred as of September 30, 2022 $ — $ 1 $ 1 On October 24, 2022, the Company’s Board of Directors approved and committed to an October 2022 restructuring plan (the “October 2022 Plan”) to reduce its cost structure to better align the Company’s operational needs to current economic conditions while continuing to support the long-term business strategy. The October 2022 Plan includes reducing its worldwide headcount by approximately 3,000 employees, or 8% of the global workforce, along with other cost saving measures. The October 2022 Plan, which the Company expects to be substantially completed by the end of the fiscal second quarter 2023, is expected to result in total pre-tax charges between $60 million and $70 million. These charges are expected to be primarily cash-based and consist of employee severance and other one-time termination benefits. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Derivative Financial InstrumentsThe Company is exposed to foreign currency exchange rate, interest rate and to a lesser extent, equity market risks relating to its ongoing business operations. From time to time, the Company enters into cash flow hedges in the form of foreign currency forward exchange contracts in order to manage the foreign currency exchange rate risk on forecasted expenses and investments denominated in foreign currencies. The Company enters into certain interest rate swap agreements to convert the variable interest rate on its Term Loans to fixed interest rates. The objective of the interest rate swap agreements is to eliminate the variability of interest payment cash flows associated with the variable interest rate under the Term Loans. The Company designates the interest rate swaps as cash flow hedges. On September 26, 2022, the Company terminated its then existing interest rate swap agreements related to Term Loans A1 and A2 and received cash proceeds of $110 million from the counterparty. The cash proceeds are reported within Net cash provided by operating activities in the Company’s Condensed Consolidated Statement of Cash Flows. The Company discontinued the related hedge accounting prospectively and as a result the realized gain of $110 million continues to be reported in AOCI and is amortized to Interest expense in the Condensed Consolidated Statement of Operations over the remaining period of the Term Loans A1 and A2. During the quarter ended September 30, 2022 , the Company entered into new interest rate swap agreements with a notional amount of $1.6 billion, to convert the variable interest rate on certain principal amounts of the Term Loans drawn under its Credit Agreement, of which $600 million will mature in September 2025 and $1.0 billion will mature in July 2027. The Company’s accounting policies for these instruments are based on whether the instruments are classified as designated or non-designated hedging instruments. The Company records all derivatives on its Condensed Consolidated Balance Sheets at fair value. The changes in the fair value of highly effective designated cash flow hedges are recorded in AOCI until the hedged item is recognized in earnings. Derivatives that are not designated as hedging instruments or are not assessed to be highly effective are adjusted to fair value through earnings. The amount of net unrealized loss on cash flow hedges was $23 million and net unrealized gain was $51 million as of September 30, 2022 and as of July 1, 2022, respectively. As of September 30, 2022, the amount of existing net gains related to cash flow hedges recorded in AOCI included a net loss of $3 million that is expected to be reclassified to earnings within twelve months. The Company de-designates its cash flow hedges when the forecasted hedged transactions affect earnings or it is probable the forecasted hedged transactions will not occur in the initially identified time period. At such time, the associated gains and losses deferred in AOCI on the Company’s Condensed Consolidated Balance Sheets are reclassified into earnings and any subsequent changes in the fair value of such derivative instruments are immediately reflected in earnings. The Company recognized a net loss of $7 million and gain of $2 million in Cost of revenue and Interest expense, respectively, related to the gain and loss of hedge designation on discontinued cash flow hedges during the three months ended September 30, 2022. The Company recognized a net loss of $2 million and $1 million in Cost of revenue and Interest expense, respectively, related to the loss of hedge designation on discontinued cash flow hedges during the three months ended October 1, 2021. Other derivatives not designated as hedging instruments consist of foreign currency forward exchange contracts that the Company uses to hedge the foreign currency exposure on forecasted expenditures denominated in currencies other than the U.S. dollar. The Company also enters into foreign currency forward contracts with contractual maturities of less than one month, which are designed to mitigate the effect of changes in foreign exchange rates on monetary assets and liabilities. The Company recognizes gains and losses on these contracts, as well as the related costs in Other, net on its Condensed Consolidated Statements of Operations. The following tables show the total notional value of the Company’s outstanding foreign currency forward exchange contracts as of September 30, 2022 and July 1, 2022. All of the foreign currency forward exchange contracts mature within 12 months. As of September 30, 2022 (Dollars in millions) Contracts Designated as Hedges Contracts Not Designated as Hedges Singapore Dollar $ 171 $ 72 Thai Baht 132 47 Chinese Renminbi 89 30 British Pound Sterling 61 24 Total $ 453 $ 173 As of July 1, 2022 (Dollars in millions) Contracts Designated as Hedges Contracts Not Designated as Hedges Singapore Dollar $ 178 $ 52 Thai Baht 133 35 Chinese Renminbi 92 24 British Pound Sterling 64 15 Total $ 467 $ 126 The Company is subject to equity market risks due to changes in the fair value of the notional investments selected by its employees as part of its non-qualified deferred compensation plan: the Seagate Deferred Compensation Plan (the “SDCP”). In fiscal year 2014, the Company entered into a Total Return Swap (“TRS”) in order to manage the equity market risks associated with the SDCP’s liabilities. The Company pays a floating rate, based on LIBOR plus an interest rate spread, on the notional amount of the TRS. The TRS is designed to substantially offset changes in the SDCP’s liabilities due to changes in the value of the investment options made by employees. As of September 30, 2022, the notional investments underlying the TRS amounted to $98 million and the contract term is through January 2023 , settled on a monthly basis, limiting counterparty performance risk. The Company did not designate the TRS as a hedge. Rather, the Company records all changes in the fair value of the TRS to earnings to offset the market value changes of the SDCP’s liabilities. The following tables show the Company’s derivative instruments measured at gross fair value as reflected in the Condensed Consolidated Balance Sheets as of September 30, 2022 and July 1, 2022: As of September 30, 2022 Derivative Assets Derivative Liabilities (Dollars in millions) Balance Sheet Location Fair Value Balance Sheet Location Fair Value Derivatives designated as hedging instruments: Foreign currency forward exchange contracts Other current assets $ — Accrued expenses $ (29) Interest rate swap Other current assets 9 Accrued expenses (3) Derivatives not designated as hedging instruments: Foreign currency forward exchange contracts Other current assets — Accrued expenses (11) Total return swap Other current assets — Accrued expenses (11) Total derivatives $ 9 $ (54) As of July 1, 2022 Derivative Assets Derivative Liabilities (Dollars in millions) Balance Sheet Location Fair Value Balance Sheet Location Fair Value Derivatives designated as hedging instruments: Foreign currency forward exchange contracts Other current assets $ — Accrued expenses $ (14) Interest rate swap Other current assets 65 Accrued expenses — Derivatives not designated as hedging instruments: Foreign currency forward exchange contracts Other current assets — Accrued expenses (5) Total return swap Other current assets — Accrued expenses (4) Total derivatives $ 65 $ (23) The following tables show the effect of the Company’s derivative instruments on the Condensed Consolidated Statements of Comprehensive Income and the Condensed Consolidated Statements of Operations for the three months ended September 30, 2022: (Dollars in millions) Derivatives Not Designated as Hedging Instruments Location of Gain/(Loss) Recognized in Income on Derivatives Amount of Gain/(Loss) Recognized in Income on Derivatives Foreign currency forward exchange contracts Other, net $ (10) Total return swap Operating expenses (8) (Dollars in millions) Derivatives Designated as Hedging Instruments Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) Location of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Location of Gain/(Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) Amount of Gain/(Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) Foreign currency forward exchange contracts $ (20) Cost of revenue $ (7) Other, net $ (1) Interest rate swap 52 Interest expense 2 Interest expense — The following table shows the effect of the Company’s derivative instruments on the Condensed Consolidated Statements of Comprehensive Income and the Condensed Consolidated Statements of Operations for the three months ended October 1, 2021 : (Dollars in millions) Derivatives Not Designated as Hedging Instruments Location of Gain/(Loss) Recognized in Income on Derivatives Amount of Gain/(Loss) Recognized in Income on Derivatives Foreign currency forward exchange contracts Other, net $ (4) Total return swap Operating expenses (1) (Dollars in millions) Derivatives Designated as Hedging Instruments Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) Location of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Location of Gain/(Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) Amount of Gain/(Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) Foreign currency forward exchange contracts $ (9) Cost of revenue $ (2) Other, net $ 1 Interest rate swap — Interest expense (1) Interest expense — |
Fair Value
Fair Value | 3 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Measurement of Fair Value Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability. Fair Value Hierarchy A fair value hierarchy is based on whether the market participant assumptions used in determining fair value are obtained from independent sources (observable inputs) or reflect the Company’s own assumptions of market participant valuation (unobservable inputs). A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs that may be used to measure fair value are: Level 1 - Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 - Quoted prices for identical assets and liabilities in markets that are inactive; quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; or Level 3 - Prices or valuations that require inputs that are both unobservable and significant to the fair value measurement. The Company considers an active market to be one in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis and views an inactive market as one in which there are few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. Where appropriate, the Company’s or the counterparty’s non-performance risk is considered in determining the fair values of liabilities and assets, respectively. Items Measured at Fair Value on a Recurring Basis The following tables present the Company’s assets and liabilities, by financial instrument type and balance sheet line item, that are measured at fair value on a recurring basis, excluding accrued interest components, as of: September 30, 2022 July 1, 2022 Fair Value Measurements at Reporting Date Using Fair Value Measurements at Reporting Date Using (Dollars in millions) Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Assets: Money market funds $ 158 $ — $ — $ 158 $ 59 $ — $ — $ 59 Total cash equivalents 158 — — 158 59 — — 59 Restricted cash and investments: Money market funds 1 — — 1 1 — — 1 Time deposits and certificates of deposit — 1 — 1 — 1 — 1 Other debt securities — — 16 16 — — 23 23 Derivative assets — 9 — 9 — 65 — 65 Total assets $ 159 $ 10 $ 16 $ 185 $ 60 $ 66 $ 23 $ 149 Liabilities: Derivative liabilities $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 Total liabilities $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 September 30, 2022 July 1, 2022 Fair Value Measurements at Reporting Date Using Fair Value Measurements at Reporting Date Using (Dollars in millions) Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Assets: Cash and cash equivalents $ 158 $ — $ — $ 158 $ 59 $ — $ — $ 59 Other current assets 1 10 — 11 1 66 — 67 Other assets, net — — 16 16 — — 23 23 Total assets $ 159 $ 10 $ 16 $ 185 $ 60 $ 66 $ 23 $ 149 Liabilities: Accrued expenses $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 Total liabilities $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 The Company classifies items in Level 1 if the financial assets consist of securities for which quoted prices are available in an active market. The Company classifies items in Level 2 if the financial asset or liability is valued using observable inputs. The Company uses observable inputs including quoted prices in active markets for similar assets or liabilities. Level 2 assets include: agency bonds, corporate bonds, commercial paper, municipal bonds, U.S. Treasuries, time deposits and certificates of deposit. These debt investments are priced using observable inputs and valuation models which vary by asset class. The Company uses a pricing service to assist in determining the fair value of all of its cash equivalents. For the cash equivalents in the Company’s portfolio, multiple pricing sources are generally available. The pricing service uses inputs from multiple industry-standard data providers or other third-party sources and various methodologies, such as weighting and models, to determine the appropriate price at the measurement date. The Company corroborates the prices obtained from the pricing service against other independent sources and, as of September 30, 2022, has not found it necessary to make any adjustments to the prices obtained. The Company’s derivative financial instruments are also classified within Level 2. The Company’s derivative financial instruments consist of foreign currency forward exchange contracts, interest rate swaps and the TRS. The Company recognizes derivative financial instruments in its condensed consolidated financial statements at fair value. The Company determines the fair value of these instruments by considering the estimated amount it would pay or receive to terminate these agreements at the reporting date. Items Measured at Fair Value on a Non-Recurring Basis From time to time, the Company enters into certain strategic investments for the promotion of business and strategic objectives, which are accounted for either under the equity method or the measurement alternative. If measured at fair value in the Condensed Consolidated Balance Sheets, these investments would generally be classified in Level 3 of the fair value hierarchy. For the investments that are accounted for under the equity method, the Company recorded a net loss of $3 million and gain of $3 million for the three months ended September 30, 2022 and October 1, 2021, respectively. The adjusted carrying value of the investments accounted for under the equity method amounted to $58 million and $61 million as of September 30, 2022 and July 1, 2022, respectively. For the investments that are accounted for under the measurement alternative, the Company recorded $3 million of net gains, which remains unrealized, for the three months ended September 30, 2022, related to upward adjustments due to observable price changes. The Company recorded a net gain of $6 million for the three months ended October 1, 2021, of which $5 million is unrealized as of October 1, 2021, related to upward adjustments due to observable price changes. As of September 30, 2022 and July 1, 2022, the carrying value of the Company’s strategic investments under the measurement alternative was $99 million and $88 million , respectively. Other Fair Value Disclosures The Company’s debt is carried at amortized cost. The estimated fair value of the Company’s debt is derived using the closing price of the same debt instruments as of the date of valuation, which takes into account the yield curve, interest rates and other observable inputs. Accordingly, these fair value measurements are categorized as Level 2. The following table presents the fair value and amortized cost of the Company’s debt in order of maturity: September 30, 2022 July 1, 2022 (Dollars in millions) Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value 4.750% Senior Notes due June 2023 $ 540 $ 537 $ 540 $ 538 4.875% Senior Notes due March 2024 499 489 499 494 4.750% Senior Notes due January 2025 479 457 479 471 4.875% Senior Notes due June 2027 504 457 504 483 4.091% Senior Notes due June 2029 468 396 466 427 3.125% Senior Notes due July 2029 500 368 500 396 4.125% Senior Notes due January 2031 500 375 500 410 3.375% Senior Notes due July 2031 500 350 500 393 5.750% Senior Notes due December 2034 489 386 489 433 SOFR Based Term Loan A1 due September 2025 (1) 600 589 600 588 SOFR Based Term Loan A2 due July 2027 (1) 600 581 600 586 SOFR Based Term Loan A3 due July 2027 600 584 — — $ 6,279 $ 5,569 $ 5,677 $ 5,219 Less: unamortized debt issuance costs (30) — (31) — Debt, net of debt issuance costs $ 6,249 $ 5,569 $ 5,646 $ 5,219 Less: current portion of debt, net of debt issuance costs (636) (630) (584) (582) Long-term debt, less current portion, net of debt issuance costs $ 5,613 $ 4,939 $ 5,062 $ 4,637 _________________________________ (1) On August 18, 2022, the Sixth Amendment to the Credit Agreement replaced the LIBOR interest rates plus variable margin of Term Loans A1 and A2 with the SOFR interest rates plus a variable margin. Refer to “ Note 3. Debt ” for more details. |
Equity
Equity | 3 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Equity | Shareholders’ Deficit Share Capital The Company’s authorized share capital i s $13,500 and consists of 1,250,000,000 ordinary shares, par value $0.00001, of which 206,434,139 shares were outstanding as of September 30, 2022, and 100,000,000 preferred shares, par value $0.00001, of which none were issued or outstanding as of September 30, 2022. Ordinary shares - Holders of ordinary shares are entitled to receive dividends when and as declared by the Company’s board of directors (the “Board of Directors”). Upon any liquidation, dissolution, or winding up of the Company, after required payments are made to holders of preferred shares, any remaining assets of the Company will be distributed ratably to holders of the preferred and ordinary shares. Holders of shares are entitled to one vote per share on all matters upon which the ordinary shares are entitled to vote, including the election of directors. Preferred shares - The Company may issue preferred shares in one or more series, up to the authorized amount, without shareholder approval. The Board of Directors is authorized to establish from time to time the number of shares to be included in each series, and to fix the rights, preferences and privileges of the shares of each wholly unissued series and any of its qualifications, limitations or restrictions. The Board of Directors can also increase or decrease the number of shares of a series, but not below the number of shares of that series then outstanding, without any further vote or action by the shareholders. The Board of Directors may authorize the issuance of preferred shares with voting or conversion rights that could harm the voting power or other rights of the holders of the ordinary shares. The issuance of preferred shares, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in control of the Company and might harm the market price of its ordinary shares and the voting and other rights of the holders of ordinary shares. Repurchases of Equity Securities All repurchases are effected as redemptions in accordance with the Company’s Constitution. As of September 30, 2022, $1.9 billion remained available for repurchase under the existing repurchase authorization limit. The following table sets forth information with respect to repurchases of the Company’s ordinary shares during the three months ended September 30, 2022: (In millions) Number of Shares Repurchased Dollar Value of Shares Repurchased Repurchases of ordinary shares (1) 5 $ 400 Tax withholding related to vesting of equity awards 1 39 Total 6 $ 439 _________________________________ (1) These amounts differ from the repurchases of ordinary shares amounts in the condensed consolidated statements of cash flows due to timing differences between repurchases and cash settlement thereof. |
Revenue
Revenue | 3 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue The following table provides information about disaggregated revenue by sales channel and geographical region for the Company’s single reportable segment: For the Three Months Ended (Dollars in millions) September 30, October 1, Revenues by Channel OEMs $ 1,545 $ 2,288 Distributors 299 507 Retailers 191 320 Total $ 2,035 $ 3,115 Revenues by Geography (1) Asia Pacific $ 801 $ 1,583 Americas 936 1,079 EMEA 298 453 Total $ 2,035 $ 3,115 _________________________________ (1) Revenue is attributed to geography based on bill from locations. |
Guarantees
Guarantees | 3 Months Ended |
Sep. 30, 2022 | |
Guarantees [Abstract] | |
Guarantees | Guarantees Indemnification Obligations The Company from time to time enters into agreements with customers, suppliers, partners and others in the ordinary course of business that provide indemnification for certain matters including, but not limited to, intellectual property infringement claims, environmental claims and breach of agreement claims. The nature of the Company’s indemnification obligations prevents the Company from making a reasonable estimate of the maximum potential amount it could be required to pay. Historically, the Company has not made any significant indemnification payments under such agreements and no amount has been accrued in the Company’s condensed consolidated financial statements with respect to these indemnification obligations. Product Warranty The Company estimates probable product warranty costs at the time revenue is recognized. The Company generally warrants its products for a period of 1 to 5 years. The Company uses estimated repair or replacement costs and uses statistical modeling to estimate product warranty return rates in order to determine its warranty obligation. Changes in the Company’s product warranty liability during the three months ended September 30, 2022 and October 1, 2021 were as follows: For the Three Months Ended (Dollars in millions) September 30, October 1, Balance, beginning of period $ 148 $ 136 Warranties issued 13 21 Repairs and replacements (24) (23) Changes in liability for pre-existing warranties, including expirations 12 6 Balance, end of period $ 149 $ 140 |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing income available to shareholders by the weighted-average number of shares outstanding during the period. Diluted earnings per share is computed by dividing income available to shareholders by the weighted-average number of shares outstanding during the period and the number of additional shares that would have been outstanding if the potentially dilutive securities had been issued. Potentially dilutive securities include outstanding options, unvested restricted share units and performance-based share units and shares to be purchased under the Employee Stock Purchase Plan. The dilutive effect of potentially dilutive securities is reflected in diluted earnings per share by application of the treasury stock method. Under the treasury stock method, an increase in fair market value of the Company’s share price can result in a greater dilutive effect from potentially dilutive securities. The following table sets forth the computation of basic and diluted net income per share attributable to the shareholders of the Company: For the Three Months Ended (In millions, except per share data) September 30, October 1, Numerator: Net income $ 29 $ 526 Number of shares used in per share calculations: Total shares for purposes of calculating basic net income per share 208 226 Weighted-average effect of dilutive securities: Employee equity award plans 2 5 Total shares for purposes of calculating diluted net income per share 210 231 Net income per share: Basic $ 0.14 $ 2.33 Diluted $ 0.14 $ 2.28 The anti-dilutive shares related to employee equity award plans that were excluded from the computation of diluted net income per share were not material for the three months ended September 30, 2022 and October 1, 2021. |
Legal, Environmental and Other
Legal, Environmental and Other Contingencies | 3 Months Ended |
Sep. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal, Environmental and Other Contingencies | Legal, Environmental and Other Contingencies The Company assesses the probability of an unfavorable outcome of all its material litigation, claims or assessments to determine whether a liability had been incurred and whether it is probable that one or more future events will occur confirming the fact of the loss. In the event that an unfavorable outcome is determined to be probable and the amount of the loss can be reasonably estimated, the Company establishes an accrual for the litigation, claim or assessment. In addition, in the event an unfavorable outcome is determined to be less than probable, but reasonably possible, the Company will disclose an estimate of the possible loss or range of such loss; however, when a reasonable estimate cannot be made, the Company will provide disclosure to that effect. Litigation is inherently uncertain and may result in adverse rulings or decisions. Additionally, the Company may enter into settlements or be subject to judgments that may, individually, or in the aggregate, have a material adverse effect on its results of operations. Accordingly, actual results could differ materially. Litigation Lambeth Magnetic Structures LLC, v. Seagate Technology (US) Holdings, Inc., et al. On April 29, 2016, Lambeth Magnetic Structures LLC filed a complaint against Seagate Technology (US) Holdings, Inc. and Seagate Technology LLC in the U.S. District Court for the Western District of Pennsylvania, alleging infringement of U.S. Patent No. 7,128,988, “Magnetic Material Structures, Devices and Methods”. The complaint seeks damages as well as additional relief. The Company believes the claims asserted in the complaint are without merit and intends to vigorously defend this case. The court issued its claim construction ruling on October 18, 2017. The trial began on April 4, 2022. On April 14, 2022, the jury returned a verdict of non-infringement for Seagate finding that Seagate had not infringed any of the asserted claims. The district court entered judgement in favor of Seagate on April 19, 2022. The parties filed post-trial motions with the district court in May 2022. The court has not yet set a hearing date for these motions. Seagate Technology LLC, et al. v. Headway Technologies, Inc, et al. On February 18, 2020, Seagate Technology LLC, Seagate Technology (Thailand) Ltd., Seagate Singapore International Headquarters Pte. Ltd. and Seagate Technology International (collectively, the “Seagate Entities”) filed a complaint in the United States District Court for the Northern District of California against defendant suppliers of HDD suspension assemblies. Defendants include NHK Spring Co. Ltd., TDK Corporation, Hutchinson Technology Inc. and several of their subsidiaries and affiliates. The complaint includes federal and state antitrust law claims, as well as a breach of contract claim. The complaint alleges that defendants and their co-conspirators knowingly conspired for more than twelve years not to compete in the supply of suspension assemblies; that defendants misused confidential information that the Seagate Entities had provided pursuant to nondisclosure agreements, in breach of their contractual obligations; and that the Seagate Entities paid artificially high prices on purchases of suspension assemblies. The Seagate Entities seek to recover the overcharges they paid for suspension assemblies, as well as additional relief permitted by law. On March 22, 2022, the Seagate Entities dismissed with prejudice all claims being asserted against Defendants TDK Corporation, Hutchinson Technology Inc. and their subsidiaries and affiliates (collectively “TDK”) relating to the antitrust law claims, the breach of contract claim and other matters described in the complaint. On April 1, 2022, the Seagate Entities and TDK filed a Stipulation for Dismissal with Prejudice to dismiss with prejudice all claims against TDK. On August 2, 2022, NHK Spring Co. Ltd. filed a motion for Partial Summary Judgment Regarding Foreign Commerce and on October 14, 2022, Seagate Entities’ filed its corresponding opposition. A trial date has not been set. Environmental Matters The Company’s operations are subject to U.S. and foreign laws and regulations relating to the protection of the environment, including those governing discharges of pollutants into the air and water, the management and disposal of hazardous substances and wastes and the cleanup of contaminated sites. Some of the Company’s operations require environmental permits and controls to prevent and reduce air and water pollution, and these permits are subject to modification, renewal and revocation by issuing authorities. The Company has established environmental management systems and continually updates its environmental policies and standard operating procedures for its operations worldwide. The Company believes that its operations are in material compliance with applicable environmental laws, regulations and permits. The Company budgets for operating and capital costs on an ongoing basis to comply with environmental laws. If additional or more stringent requirements are imposed on the Company in the future, it could incur additional operating costs and capital expenditures. Some environmental laws, such as the Comprehensive Environmental Response Compensation and Liability Act of 1980 (as amended, the “Superfund” law) and its state equivalents, can impose liability for the cost of cleanup of contaminated sites upon any of the current or former site owners or operators or upon parties who sent waste to these sites, regardless of whether the owner or operator owned the site at the time of the release of hazardous substances or the lawfulness of the original disposal activity. The Company has been identified as a responsible or potentially responsible party at several sites. At each of these sites, the Company has an assigned portion of the financial liability based on the type and amount of hazardous substances disposed of by each party at the site and the number of financially viable parties. The Company has fulfilled its responsibilities at some of these sites and remains involved in only a few at this time. While the Company’s ultimate costs in connection with these sites is difficult to predict with complete accuracy, based on its current estimates of cleanup costs and its expected allocation of these costs, the Company does not expect costs in connection with these sites to be material. The Company may be subject to various state, federal and international laws and regulations governing the environment, including those restricting the presence of certain substances in electronic products. For example, the European Union (“EU”) enacted the Restriction of the Use of Certain Hazardous Substances in Electrical and Electronic Equipment (2011/65/EU), which prohibits the use of certain substances, including lead, in certain products, including disk drives and server storage products, put on the market after July 1, 2006. Similar legislation has been or may be enacted in other jurisdictions, including in the U.S., Canada, Mexico, Taiwan, China, Japan and others. The EU REACH Directive (Registration, Evaluation, Authorization and Restriction of Chemicals, EC 1907/2006) also restricts substances of very high concern in products. If the Company or its suppliers fails to comply with the substance restrictions, recycle requirements or other environmental requirements as they are enacted worldwide, it could have a materially adverse effect on the Company’s business. Other Matters On August 29, 2022, the Company received a proposed charging letter (“PCL”) from the U.S. Commerce Department’s Bureau of Industry and Security (“BIS”), alleging violations of the U.S. Export Administration Regulations (“EAR”). The PCL alleges the Company acted in violation of the EAR by providing its HDDs to a customer and its affiliates listed on the BIS Entity List between August 2020 and September 2021. The Company believes these allegations are without merit and will defend itself vigorously. The Company has responded to the PCL, setting forth its position that it did not engage in prohibited conduct as alleged by BIS, because, among other reasons, Seagate’s HDDs are not subject to the EAR. The matters raised by the PCL remain unresolved at this time, and there can be no assurance as to the timing or terms of any final outcome. The Company is unable at this time to estimate the range of loss and/or penalty, if any, although it is possible that the outcome could have a material impact on its business, results of operations, financial condition, and cash flows. The Company believes that it has complied with all relevant export control laws and regulations. The Company has committed to compliance through its global team of international trade compliance and legal professionals and by maintaining robust trade controls, compliance policies and procedures. The Company has been cooperating with BIS and intends to continue to engage with BIS to seek a resolution of this matter. The Company is involved in a number of other judicial, regulatory or administrative proceedings and investigations incidental to its business, and the Company may be involved in such proceedings and investigations arising in the normal course of its business in the future. Although occasional adverse decisions or settlements may occur, the Company believes that the final disposition of such matters will not have a material adverse effect on its financial position or results of operations. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Sep. 30, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Dividend Declared O n October 26, 2022, the Com pany’s Board of Directors declared a quarterly cash dividend of $0.70 per share, which will be payable on January 5, 2023 to shareholders of record as of the close of business on December 21, 2022 . Restructuring Plan On October 24, 2022, the Company’s Board of Directors approved and committed to a plan to reduce its cost structure to better align the Company’s operational needs to current economic conditions while continuing to support the long-term business strategy. See “ Note 5. Restructuring and Exit Costs ” for more information. |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Sep. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Consolidation, Policy | The Company’s unaudited condensed consolidated financial statements include the accounts of the Company and all its wholly-owned and majority-owned subsidiaries, after elimination of intercompany transactions and balances. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Company’s condensed consolidated financial statements and accompanying notes. These estimates and assumptions include the impact of the COVID-19 pandemic. Actual results could differ materially from those estimates. The methods, estimates and judgments the Company uses in applying its most critical accounting policies have a significant impact on the results the Company reports in its condensed consolidated financial statements. The Company’s consolidated financial statements for the fiscal year ended July 1, 2022 are included in its Annual Report on Form 10-K, as filed with the U.S. Securities and Exchange Commission (“SEC”) on August 5, 2022. The Company believes that the disclosures included in these unaudited condensed consolidated financial statements, when read in conjunction with its consolidated financial statements as of July 1, 2022, and the notes thereto, are adequate to make the information presented not misleading. The results of operations and the cash flows for the three months ended September 30, 2022 are not necessarily indicative of the results to be expected for any subsequent interim period or for the Company’s fiscal year ending June 30, 2023. |
Fiscal Period, Policy | The Company operates and reports financial results on a fiscal year of 52 or 53 weeks ending on the Friday closest to June 30. In fiscal years with 53 weeks, the first quarter consists of 14 weeks and the remaining quarters consist of 13 weeks each. The three months ended September 30, 2022 and October 1, 2021 consisted of 13 weeks. Fiscal years 2023 and 2022 both comprise of 52 weeks and end on June 30, 2023 and July 1, 2022, respectively. The fiscal quarters ended September 30, 2022, July 1, 2022 and October 1, 2021, are also referred to herein as the “September 2022 quarter”, the “June 2022 quarter” and the “September 2021 quarter”, respectively. |
Recently Issued Accounting Pronouncements, Policy | Recently Issued Accounting Pronouncements In September 2022, the FASB issued ASU 2022-04 (ASC Subtopic 405-50), Disclosure of Supplier Finance Program Obligations . This ASU requires disclosure of key terms of the outstanding supplier finance programs and a rollforward of the related obligations. The Company is required to adopt this guidance in the first quarter of fiscal year 2024. Early adoption is permitted. The Company is in the process of assessing the impact of this ASU on its condensed consolidated financial statements. |
Derivatives, Policy | The Company is exposed to foreign currency exchange rate, interest rate and to a lesser extent, equity market risks relating to its ongoing business operations. From time to time, the Company enters into cash flow hedges in the form of foreign currency forward exchange contracts in order to manage the foreign currency exchange rate risk on forecasted expenses and investments denominated in foreign currencies. The Company enters into certain interest rate swap agreements to convert the variable interest rate on its Term Loans to fixed interest rates. The objective of the interest rate swap agreements is to eliminate the variability of interest payment cash flows associated with the variable interest rate under the Term Loans. The Company designates the interest rate swaps as cash flow hedges. On September 26, 2022, the Company terminated its then existing interest rate swap agreements related to Term Loans A1 and A2 and received cash proceeds of $110 million from the counterparty. The cash proceeds are reported within Net cash provided by operating activities in the Company’s Condensed Consolidated Statement of Cash Flows. The Company discontinued the related hedge accounting prospectively and as a result the realized gain of $110 million continues to be reported in AOCI and is amortized to Interest expense in the Condensed Consolidated Statement of Operations over the remaining period of the Term Loans A1 and A2. During the quarter ended September 30, 2022 , the Company entered into new interest rate swap agreements with a notional amount of $1.6 billion, to convert the variable interest rate on certain principal amounts of the Term Loans drawn under its Credit Agreement, of which $600 million will mature in September 2025 and $1.0 billion will mature in July 2027. The Company’s accounting policies for these instruments are based on whether the instruments are classified as designated or non-designated hedging instruments. The Company records all derivatives on its Condensed Consolidated Balance Sheets at fair value. The changes in the fair value of highly effective designated cash flow hedges are recorded in AOCI until the hedged item is recognized in earnings. Derivatives that are not designated as hedging instruments or are not assessed to be highly effective are adjusted to fair value through earnings. The amount of net unrealized loss on cash flow hedges was $23 million and net unrealized gain was $51 million as of September 30, 2022 and as of July 1, 2022, respectively. As of September 30, 2022, the amount of existing net gains related to cash flow hedges recorded in AOCI included a net loss of $3 million that is expected to be reclassified to earnings within twelve months. |
Fair Value Measurement, Policy | Measurement of Fair Value Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at fair value, the Company considers the principal or most advantageous market in which it would transact, and it considers assumptions that market participants would use when pricing the asset or liability. Fair Value Hierarchy A fair value hierarchy is based on whether the market participant assumptions used in determining fair value are obtained from independent sources (observable inputs) or reflect the Company’s own assumptions of market participant valuation (unobservable inputs). A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. The three levels of inputs that may be used to measure fair value are: Level 1 - Quoted prices in active markets that are unadjusted and accessible at the measurement date for identical, unrestricted assets or liabilities; Level 2 - Quoted prices for identical assets and liabilities in markets that are inactive; quoted prices for similar assets and liabilities in active markets or financial instruments for which significant inputs are observable, either directly or indirectly; or Level 3 - Prices or valuations that require inputs that are both unobservable and significant to the fair value measurement. The Company considers an active market to be one in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis and views an inactive market as one in which there are few transactions for the asset or liability, the prices are not current, or price quotations vary substantially either over time or among market makers. Where appropriate, the Company’s or the counterparty’s non-performance risk is considered in determining the fair values of liabilities and assets, respectively. |
Fair Value of Financial Instruments, Policy | Items Measured at Fair Value on a Non-Recurring BasisFrom time to time, the Company enters into certain strategic investments for the promotion of business and strategic objectives, which are accounted for either under the equity method or the measurement alternative. If measured at fair value in the Condensed Consolidated Balance Sheets, these investments would generally be classified in Level 3 of the fair value hierarchy. |
Standard Product Warranty, Policy | Product WarrantyThe Company estimates probable product warranty costs at the time revenue is recognized. The Company generally warrants its products for a period of 1 to 5 years. The Company uses estimated repair or replacement costs and uses statistical modeling to estimate product warranty return rates in order to determine its warranty obligation. |
Balance Sheet Information (Tabl
Balance Sheet Information (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Disclosure Text Block Supplement [Abstract] | |
Summary of Debt Securities, Available-for-sale | The following table summarizes, by major type, the fair value and amortized cost of the Company’s available-for-sale debt investments as of September 30, 2022 and July 1, 2022: September 30, July 1, (Dollars in millions) Amortized Cost Unrealized Gain/(Loss) Fair Value Amortized Cost Unrealized Gain/(Loss) Fair Value Available-for-sale debt securities: Money market funds $ 159 $ — $ 159 $ 60 $ — $ 60 Time deposits and certificates of deposit 1 — 1 1 — 1 Other debt securities 16 — 16 23 — 23 Total $ 176 $ — $ 176 $ 84 $ — $ 84 Included in Cash and cash equivalents $ 158 $ 59 Included in Other current assets 2 2 Included in Other assets, net 16 23 Total $ 176 $ 84 |
Fair value and amortized cost of available-for-sale securities by contractual maturity | The fair value and amortized cost of the Company’s investments classified as available-for-sale debt securities as of September 30, 2022, by remaining contractual maturity were as follows: (Dollars in millions) Amortized Cost Fair Value Due in less than 1 year $ 160 $ 160 Due in 1 to 5 years 15 15 Due in 6 to 10 years — — Thereafter 1 1 Total $ 176 $ 176 |
Cash, cash equivalents, and restricted cash | The following table provides a summary of cash, cash equivalents and restricted cash reported within the Company’s Condensed Consolidated Balance Sheets that reconciles to the corresponding amount in the Company’s Condensed Consolidated Statements of Cash Flows: (Dollars in millions) September 30, July 1, October 1, July 2, Cash and cash equivalents $ 761 $ 615 $ 991 $ 1,209 Restricted cash included in Other current assets 2 2 2 2 Total cash, cash equivalents and restricted cash shown in the Statements of Cash Flows $ 763 $ 617 $ 993 $ 1,211 |
Inventories | The following table provides details of the inventory balance sheet item: (Dollars in millions) September 30, July 1, Raw materials and components $ 648 $ 601 Work-in-process 402 414 Finished goods 556 550 Total inventories $ 1,606 $ 1,565 |
Property, Equipment and Leasehold Improvements, net | The components of property, equipment and leasehold improvements, net, were as follows: (Dollars in millions) September 30, July 1, Property, equipment and leasehold improvements $ 10,699 $ 10,659 Accumulated depreciation and amortization (8,503) (8,420) Property, equipment and leasehold improvements, net $ 2,196 $ 2,239 |
Accrued expenses | The following table provides details of the accrued expenses balance sheet item: (Dollars in millions) September 30, July 1, Dividends payable $ 145 $ 147 Other accrued expenses 473 449 Total $ 618 $ 596 |
Schedule of accumulated other comprehensive income (loss) | The components of AOCI, net of tax, were as follows: (Dollars in millions) Unrealized Gains/(Losses) on Cash Flow Hedges Unrealized Gains/(Losses) on Post-Retirement Plans Foreign Currency Translation Adjustments Total Balance at July 1, 2022 $ 51 $ (14) $ (1) $ 36 Other comprehensive income before reclassifications 32 1 — 33 Amounts reclassified from AOCI 5 — (1) 4 Other comprehensive income 37 1 (1) 37 Balance at September 30, 2022 $ 88 $ (13) $ (2) $ 73 Balance at July 2, 2021 $ (18) $ (22) $ (1) $ (41) Other comprehensive (loss) income before reclassifications (9) 1 — (8) Amounts reclassified from AOCI 3 1 — 4 Other comprehensive loss (6) 2 — (4) Balance at October 1, 2021 $ (24) $ (20) $ (1) $ (45) |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The following table provides details of the Company’s debt as of September 30, 2022 and July 1, 2022: (Dollars in millions) September 30, July 1, Unsecured Senior Notes (1) $1,000 issued on May 22, 2013 at 4.75% due June 1, 2023 (the “2023 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. $ 540 $ 540 $500 issued on February 3, 2017 at 4.875% due March 1, 2024 (the “2024 Notes”) , interest payable semi-annually on March 1 and September 1 of each year. 499 499 $1,000 issued on May 28, 2014 at 4.75% due January 1, 2025 (the “2025 Notes”) , interest payable semi-annually on January 1 and July 1 of each year. 479 479 $700 issued on May 14, 2015 at 4.875% due June 1, 2027 (the “2027 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. 504 504 $500 issued on June 18, 2020 at 4.091% due June 1, 2029 (the “June 2029 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. 468 466 $500 issued on December 8, 2020 at 3.125% due July 15, 2029 (the “July 2029 Notes”) , interest payable semi-annually on January 15 and July 15 of each year. 500 500 $500 issued on June 10, 2020 at 4.125% due January 15, 2031 (the “January 2031 Notes”) , interest payable semi-annually on January 15 and July 15 of each year. 500 500 $500 issued on December 8, 2020 at 3.375% due July 15, 2031 (the “July 2031 Notes”) , interest payable semi-annually on January 15 and July 15 of each year. 500 500 $500 issued on December 2, 2014 at 5.75% due December 1, 2034 (the “2034 Notes”) , interest payable semi-annually on June 1 and December 1 of each year. 489 489 Term Loans $600 borrowed on October 14, 2021 at SOFR plus a variable margin ranging from 1.125% to 2.375%, (the “Term Loan A1”) , repayable in quarterly installments beginning on December 31, 2022, with a final maturity date of September 16, 2025. 600 600 $600 borrowed on October 14, 2021 at SOFR plus a variable margin ranging from 1.25% to 2.5%, (the “Term Loan A2”) , repayable in quarterly installments beginning on December 31, 2022, with a final maturity date of July 30, 2027. 600 600 $600 borrowed on August 18, 2022 at SOFR plus a variable margin ranging from 1.25% to 2.5%, ( the “ Term Loan A3 ”), repayable in quarterly installments beginning on December 31, 2022, with a final maturity date of July 30, 2027. 600 — 6,279 5,677 Less: unamortized debt issuance costs (30) (31) Debt, net of debt issuance costs 6,249 5,646 Less: current portion of long-term debt (636) (584) Long-term debt, less current portion $ 5,613 $ 5,062 __________________________________ (1) All unsecured senior notes are issued by Seagate HDD Cayman, and the obligations under these notes are fully and unconditionally guaranteed, on a senior unsecured basis, by Seagate Technology Unlimited Company (“STUC”) and, pursuant to a supplemental indenture dated as of May 18, 2021, STX. |
Future principal payments on long-term debt | At September 30, 2022, future principal payments on long-term debt were as follows (in millions): Fiscal Year Amount Remainder of 2023 $ 608 2024 614 2025 627 2026 629 2027 649 Thereafter 3,188 Total $ 6,315 |
Restructuring and Exit Costs Re
Restructuring and Exit Costs Restructuring and Exit Costs (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost [Table Text Block] | The following tables summarize the Company’s restructuring activities under the Company’s active restructuring plans: (Dollars in millions) Workforce Reduction Costs Facilities and Other Exit Costs Total Accrual balances at July 1, 2022 $ — $ 5 $ 5 Restructuring charges 9 — 9 Cash payments (3) (1) (4) Accrual balances at September 30, 2022 $ 6 $ 4 $ 10 Total costs incurred inception to date as of September 30, 2022 $ 72 $ 24 $ 96 Total expected charges to be incurred as of September 30, 2022 $ — $ 1 $ 1 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of notional value of outstanding foreign currency forward exchange contracts | The following tables show the total notional value of the Company’s outstanding foreign currency forward exchange contracts as of September 30, 2022 and July 1, 2022. All of the foreign currency forward exchange contracts mature within 12 months. As of September 30, 2022 (Dollars in millions) Contracts Designated as Hedges Contracts Not Designated as Hedges Singapore Dollar $ 171 $ 72 Thai Baht 132 47 Chinese Renminbi 89 30 British Pound Sterling 61 24 Total $ 453 $ 173 As of July 1, 2022 (Dollars in millions) Contracts Designated as Hedges Contracts Not Designated as Hedges Singapore Dollar $ 178 $ 52 Thai Baht 133 35 Chinese Renminbi 92 24 British Pound Sterling 64 15 Total $ 467 $ 126 |
Schedule of gross fair value of derivative instruments | The following tables show the Company’s derivative instruments measured at gross fair value as reflected in the Condensed Consolidated Balance Sheets as of September 30, 2022 and July 1, 2022: As of September 30, 2022 Derivative Assets Derivative Liabilities (Dollars in millions) Balance Sheet Location Fair Value Balance Sheet Location Fair Value Derivatives designated as hedging instruments: Foreign currency forward exchange contracts Other current assets $ — Accrued expenses $ (29) Interest rate swap Other current assets 9 Accrued expenses (3) Derivatives not designated as hedging instruments: Foreign currency forward exchange contracts Other current assets — Accrued expenses (11) Total return swap Other current assets — Accrued expenses (11) Total derivatives $ 9 $ (54) As of July 1, 2022 Derivative Assets Derivative Liabilities (Dollars in millions) Balance Sheet Location Fair Value Balance Sheet Location Fair Value Derivatives designated as hedging instruments: Foreign currency forward exchange contracts Other current assets $ — Accrued expenses $ (14) Interest rate swap Other current assets 65 Accrued expenses — Derivatives not designated as hedging instruments: Foreign currency forward exchange contracts Other current assets — Accrued expenses (5) Total return swap Other current assets — Accrued expenses (4) Total derivatives $ 65 $ (23) |
Schedule of the effect of derivative instruments on Other comprehensive income (loss) and the Consolidated Statement of Operations | The following tables show the effect of the Company’s derivative instruments on the Condensed Consolidated Statements of Comprehensive Income and the Condensed Consolidated Statements of Operations for the three months ended September 30, 2022: (Dollars in millions) Derivatives Not Designated as Hedging Instruments Location of Gain/(Loss) Recognized in Income on Derivatives Amount of Gain/(Loss) Recognized in Income on Derivatives Foreign currency forward exchange contracts Other, net $ (10) Total return swap Operating expenses (8) (Dollars in millions) Derivatives Designated as Hedging Instruments Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) Location of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Location of Gain/(Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) Amount of Gain/(Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) Foreign currency forward exchange contracts $ (20) Cost of revenue $ (7) Other, net $ (1) Interest rate swap 52 Interest expense 2 Interest expense — The following table shows the effect of the Company’s derivative instruments on the Condensed Consolidated Statements of Comprehensive Income and the Condensed Consolidated Statements of Operations for the three months ended October 1, 2021 : (Dollars in millions) Derivatives Not Designated as Hedging Instruments Location of Gain/(Loss) Recognized in Income on Derivatives Amount of Gain/(Loss) Recognized in Income on Derivatives Foreign currency forward exchange contracts Other, net $ (4) Total return swap Operating expenses (1) (Dollars in millions) Derivatives Designated as Hedging Instruments Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) Location of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) Location of Gain/(Loss) Recognized in Income on Derivatives (Ineffective Portion and Amount Excluded from Effectiveness Testing) Amount of Gain/(Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) Foreign currency forward exchange contracts $ (9) Cost of revenue $ (2) Other, net $ 1 Interest rate swap — Interest expense (1) Interest expense — |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables present the Company’s assets and liabilities, by financial instrument type and balance sheet line item, that are measured at fair value on a recurring basis, excluding accrued interest components, as of: September 30, 2022 July 1, 2022 Fair Value Measurements at Reporting Date Using Fair Value Measurements at Reporting Date Using (Dollars in millions) Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Assets: Money market funds $ 158 $ — $ — $ 158 $ 59 $ — $ — $ 59 Total cash equivalents 158 — — 158 59 — — 59 Restricted cash and investments: Money market funds 1 — — 1 1 — — 1 Time deposits and certificates of deposit — 1 — 1 — 1 — 1 Other debt securities — — 16 16 — — 23 23 Derivative assets — 9 — 9 — 65 — 65 Total assets $ 159 $ 10 $ 16 $ 185 $ 60 $ 66 $ 23 $ 149 Liabilities: Derivative liabilities $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 Total liabilities $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 |
Schedule of Fair Value, by Balance Sheet Grouping, Measured on Recurring Basis | September 30, 2022 July 1, 2022 Fair Value Measurements at Reporting Date Using Fair Value Measurements at Reporting Date Using (Dollars in millions) Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Quoted Prices in Active Markets for Identical Instruments (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Balance Assets: Cash and cash equivalents $ 158 $ — $ — $ 158 $ 59 $ — $ — $ 59 Other current assets 1 10 — 11 1 66 — 67 Other assets, net — — 16 16 — — 23 23 Total assets $ 159 $ 10 $ 16 $ 185 $ 60 $ 66 $ 23 $ 149 Liabilities: Accrued expenses $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 Total liabilities $ — $ 54 $ — $ 54 $ — $ 23 $ — $ 23 |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The following table presents the fair value and amortized cost of the Company’s debt in order of maturity: September 30, 2022 July 1, 2022 (Dollars in millions) Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value 4.750% Senior Notes due June 2023 $ 540 $ 537 $ 540 $ 538 4.875% Senior Notes due March 2024 499 489 499 494 4.750% Senior Notes due January 2025 479 457 479 471 4.875% Senior Notes due June 2027 504 457 504 483 4.091% Senior Notes due June 2029 468 396 466 427 3.125% Senior Notes due July 2029 500 368 500 396 4.125% Senior Notes due January 2031 500 375 500 410 3.375% Senior Notes due July 2031 500 350 500 393 5.750% Senior Notes due December 2034 489 386 489 433 SOFR Based Term Loan A1 due September 2025 (1) 600 589 600 588 SOFR Based Term Loan A2 due July 2027 (1) 600 581 600 586 SOFR Based Term Loan A3 due July 2027 600 584 — — $ 6,279 $ 5,569 $ 5,677 $ 5,219 Less: unamortized debt issuance costs (30) — (31) — Debt, net of debt issuance costs $ 6,249 $ 5,569 $ 5,646 $ 5,219 Less: current portion of debt, net of debt issuance costs (636) (630) (584) (582) Long-term debt, less current portion, net of debt issuance costs $ 5,613 $ 4,939 $ 5,062 $ 4,637 _________________________________ (1) On August 18, 2022, the Sixth Amendment to the Credit Agreement replaced the LIBOR interest rates plus variable margin of Term Loans A1 and A2 with the SOFR interest rates plus a variable margin. Refer to “ Note 3. Debt ” for more details. |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Equity [Abstract] | |
Schedule of Share Repurchases | The following table sets forth information with respect to repurchases of the Company’s ordinary shares during the three months ended September 30, 2022: (In millions) Number of Shares Repurchased Dollar Value of Shares Repurchased Repurchases of ordinary shares (1) 5 $ 400 Tax withholding related to vesting of equity awards 1 39 Total 6 $ 439 _________________________________ (1) These amounts differ from the repurchases of ordinary shares amounts in the condensed consolidated statements of cash flows due to timing differences between repurchases and cash settlement thereof. |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table provides information about disaggregated revenue by sales channel and geographical region for the Company’s single reportable segment: For the Three Months Ended (Dollars in millions) September 30, October 1, Revenues by Channel OEMs $ 1,545 $ 2,288 Distributors 299 507 Retailers 191 320 Total $ 2,035 $ 3,115 Revenues by Geography (1) Asia Pacific $ 801 $ 1,583 Americas 936 1,079 EMEA 298 453 Total $ 2,035 $ 3,115 _________________________________ (1) Revenue is attributed to geography based on bill from locations. |
Guarantees (Tables)
Guarantees (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Guarantees [Abstract] | |
Schedule of Product Warranty Liability | Changes in the Company’s product warranty liability during the three months ended September 30, 2022 and October 1, 2021 were as follows: For the Three Months Ended (Dollars in millions) September 30, October 1, Balance, beginning of period $ 148 $ 136 Warranties issued 13 21 Repairs and replacements (24) (23) Changes in liability for pre-existing warranties, including expirations 12 6 Balance, end of period $ 149 $ 140 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Sep. 30, 2022 | |
Earnings Per Share [Abstract] | |
Schedule of computation of basic and diluted net income (loss) per share | The following table sets forth the computation of basic and diluted net income per share attributable to the shareholders of the Company: For the Three Months Ended (In millions, except per share data) September 30, October 1, Numerator: Net income $ 29 $ 526 Number of shares used in per share calculations: Total shares for purposes of calculating basic net income per share 208 226 Weighted-average effect of dilutive securities: Employee equity award plans 2 5 Total shares for purposes of calculating diluted net income per share 210 231 Net income per share: Basic $ 0.14 $ 2.33 Diluted $ 0.14 $ 2.28 |
Balance Sheet Information (Summ
Balance Sheet Information (Summary of fair value and amortized cost of investments, by major type) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 |
Available-for-sale debt securities: | ||
Amortized Cost | $ 176 | $ 84 |
Unrealized Gain/(Loss) | 0 | 0 |
Fair Value | 176 | 84 |
Included in Cash and cash equivalents | ||
Available-for-sale debt securities: | ||
Fair Value | 158 | 59 |
Included in Other current assets | ||
Available-for-sale debt securities: | ||
Fair Value | 2 | 2 |
Included in Other assets, net | ||
Available-for-sale debt securities: | ||
Fair Value | 16 | 23 |
Money market funds | ||
Available-for-sale debt securities: | ||
Amortized Cost | 159 | 60 |
Unrealized Gain/(Loss) | 0 | 0 |
Fair Value | 159 | 60 |
Time deposits and certificates of deposit | ||
Available-for-sale debt securities: | ||
Amortized Cost | 1 | 1 |
Unrealized Gain/(Loss) | 0 | 0 |
Fair Value | 1 | 1 |
Other debt securities | ||
Available-for-sale debt securities: | ||
Amortized Cost | 16 | 23 |
Unrealized Gain/(Loss) | 0 | 0 |
Fair Value | $ 16 | $ 23 |
Balance Sheet Information - Nar
Balance Sheet Information - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Sep. 30, 2022 | Jul. 01, 2022 | Oct. 01, 2021 | Jul. 02, 2021 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Restricted cash included in Other current assets | $ 2 | $ 2 | $ 2 | $ 2 |
Other than temporary impairment losses, investments, available-for-sale securities | 0 | 0 | ||
Continuing Involvement with Continued to be Recognized Transferred Financial Assets, Amount Outstanding | 237 | |||
Available-for-sale Securities | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Restricted cash included in Other current assets | 2 | $ 2 | ||
Factored Trade Receivable | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Proceeds from Sale and Collection of Receivables | $ 200 |
Balance Sheet Information (Fair
Balance Sheet Information (Fair value and amortized cost of available-for-sale securities by contractual maturity) (Details) $ in Millions | Sep. 30, 2022 USD ($) |
Amortized Cost | |
Amortized cost, due in less than 1 year | $ 160 |
Amortized cost, due in 1 to 5 years | 15 |
Amortized cost, due in 6 to 10 years | 0 |
Amortized cost, thereafter | 1 |
Amortized Cost | 176 |
Fair Value | |
Fair value, due in less than 1 year | 160 |
Fair value, due in 1 to 5 years | 15 |
Fair value, due in 6 to 10 years | 0 |
Fair value, thereafter | 1 |
Fair Value | $ 176 |
Balance Sheet Information (Cash
Balance Sheet Information (Cash, Cash Equivalents, and Restricted Cash) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 | Oct. 01, 2021 | Jul. 02, 2021 |
Investments, Debt and Equity Securities [Abstract] | ||||
Cash and cash equivalents | $ 761 | $ 615 | $ 991 | $ 1,209 |
Restricted cash included in Other current assets | 2 | 2 | 2 | 2 |
Total cash, cash equivalents and restricted cash shown in the Statements of Cash Flows | $ 763 | $ 617 | $ 993 | $ 1,211 |
Balance Sheet Information (Inve
Balance Sheet Information (Inventories) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 |
Inventory, Net [Abstract] | ||
Raw materials and components | $ 648 | $ 601 |
Work-in-process | 402 | 414 |
Finished goods | 556 | 550 |
Total inventories | $ 1,606 | $ 1,565 |
Balance Sheet Information (Prop
Balance Sheet Information (Property, Equipment and Leasehold Improvements, net) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 |
Property, Plant and Equipment, Net [Abstract] | ||
Property, equipment and leasehold improvements | $ 10,699 | $ 10,659 |
Accumulated depreciation and amortization | (8,503) | (8,420) |
Property, equipment and leasehold improvements, net | $ 2,196 | $ 2,239 |
Balance Sheet Information (Accr
Balance Sheet Information (Accrued expenses) (Details) - USD ($) | Sep. 30, 2022 | Jul. 01, 2022 |
Payables and Accruals [Abstract] | ||
Dividends payable | $ 145,000,000 | $ 147,000,000 |
Other accrued expenses | 473,000,000 | 449,000,000 |
Total | $ 618,000,000 | $ 596,000,000 |
Balance Sheet Information (AOCI
Balance Sheet Information (AOCI) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | $ 109 | $ 631 |
Other comprehensive income, unrealized gains (losses) on cash flow hedges | 37 | (6) |
Other comprehensive income, unrealized gains (losses) on post-retirement plans | (1) | (2) |
Other comprehensive income, foreign currency translation adjustments | (1) | 0 |
Other comprehensive income | 37 | (4) |
Ending balance | (351) | 601 |
Accumulated Other Comprehensive Income | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 36 | (41) |
Other comprehensive income before reclassifications | 33 | (8) |
Amounts reclassified from AOCI | 4 | 4 |
Other comprehensive income | 37 | (4) |
Ending balance | 73 | (45) |
Unrealized Gains/(Losses) on Cash Flow Hedges | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | 51 | (18) |
Other comprehensive income before reclassifications, unrealized gains (losses) on cash flow hedges | 32 | (9) |
Amounts reclassified from AOCI, unrealized gains (losses) on cash flow hedges | (5) | (3) |
Other comprehensive income, unrealized gains (losses) on cash flow hedges | 37 | (6) |
Ending balance | 88 | (24) |
Unrealized Gains/(Losses) on Post-Retirement Plans | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (14) | (22) |
Other comprehensive income before reclassifications, unrealized gains (losses) on post-retirement plans | 1 | 1 |
Amounts reclassified from AOCI, unrealized gains (losses) on post-retirement plans | 0 | (1) |
Other comprehensive income, unrealized gains (losses) on post-retirement plans | 1 | 2 |
Ending balance | (13) | (20) |
Foreign Currency Translation Adjustments | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Beginning balance | (1) | (1) |
Other comprehensive income before reclassifications | 0 | 0 |
Amounts reclassified from AOCI | (1) | 0 |
Other comprehensive income, foreign currency translation adjustments | (1) | 0 |
Ending balance | $ (2) | $ (1) |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) | Aug. 18, 2022 | Oct. 14, 2021 | Sep. 30, 2022 | Jul. 01, 2022 | Dec. 08, 2020 | Jun. 18, 2020 | Jun. 10, 2020 | Feb. 03, 2017 | May 14, 2015 | Dec. 02, 2014 | May 28, 2014 | May 22, 2013 |
Debt Instrument [Line Items] | ||||||||||||
Less: current portion of debt, net of debt issuance costs | $ (636,000,000) | $ (584,000,000) | ||||||||||
Long-term debt, less current portion | 5,613,000,000 | 5,062,000,000 | ||||||||||
Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Long-term debt, gross | 6,279,000,000 | 5,677,000,000 | ||||||||||
Debt issuance costs | (30,000,000) | (31,000,000) | ||||||||||
Debt, net of debt issuance costs | 6,249,000,000 | 5,646,000,000 | ||||||||||
Less: current portion of debt, net of debt issuance costs | (636,000,000) | (584,000,000) | ||||||||||
Long-term debt, less current portion | 5,613,000,000 | 5,062,000,000 | ||||||||||
4.750% Senior Notes due June 2023 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 540,000,000 | 540,000,000 | ||||||||||
4.875% Senior Notes due March 2024 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 499,000,000 | 499,000,000 | ||||||||||
4.750% Senior Notes due January 2025 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 479,000,000 | 479,000,000 | ||||||||||
4.875% Senior Notes due June 2027 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 504,000,000 | 504,000,000 | ||||||||||
4.091% Senior Notes due June 2029 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 468,000,000 | 466,000,000 | ||||||||||
3.125% Senior Notes due July 2029 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 500,000,000 | 500,000,000 | ||||||||||
4.125% Senior Notes due January 2031 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 500,000,000 | 500,000,000 | ||||||||||
3.375% Senior Notes due July 2031 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 500,000,000 | |||||||||||
Stated interest rate (as a percent) | 3.375% | |||||||||||
3.375% Senior Notes due July 2031 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 500,000,000 | 500,000,000 | ||||||||||
5.750% Senior Notes due December 2034 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 489,000,000 | 489,000,000 | ||||||||||
Term Loan A1 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 600,000,000 | 600,000,000 | ||||||||||
Term Loan A2 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | 600,000,000 | 600,000,000 | ||||||||||
Term Loan A3 | Carrying Amount | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Senior Notes | $ 600,000,000 | $ 0 | ||||||||||
Senior Notes | 4.750% Senior Notes due June 2023 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 1,000,000,000 | |||||||||||
Stated interest rate (as a percent) | 4.75% | |||||||||||
Senior Notes | 4.875% Senior Notes due March 2024 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 500,000,000 | |||||||||||
Stated interest rate (as a percent) | 4.875% | |||||||||||
Senior Notes | 4.750% Senior Notes due January 2025 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 1,000,000,000 | |||||||||||
Stated interest rate (as a percent) | 4.75% | |||||||||||
Senior Notes | 4.875% Senior Notes due June 2027 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 700,000,000 | |||||||||||
Stated interest rate (as a percent) | 4.875% | |||||||||||
Senior Notes | 4.091% Senior Notes due June 2029 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 500,000,000 | |||||||||||
Stated interest rate (as a percent) | 4.091% | |||||||||||
Senior Notes | 3.125% Senior Notes due July 2029 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 500,000,000 | |||||||||||
Stated interest rate (as a percent) | 3.125% | |||||||||||
Senior Notes | 4.125% Senior Notes due January 2031 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 500,000,000 | |||||||||||
Stated interest rate (as a percent) | 4.125% | |||||||||||
Senior Notes | 3.375% Senior Notes due July 2031 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Stated interest rate (as a percent) | 3.375% | |||||||||||
Senior Notes | 5.750% Senior Notes due December 2034 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Aggregate principal amount | $ 500,000,000 | |||||||||||
Stated interest rate (as a percent) | 5.75% | |||||||||||
Term Loan A1 | Minimum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.125% | |||||||||||
Term Loan A1 | Maximum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.375% | |||||||||||
Term Loan A1 | Term Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | |||||||||||
Term Loan A2 | Minimum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||||||||||
Term Loan A2 | Maximum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | |||||||||||
Term Loan A2 | Term Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 | |||||||||||
Term Loan A3 | Minimum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||||||||||
Term Loan A3 | Maximum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | |||||||||||
Term Loan A3 | Term Loan | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Line of credit facility, maximum borrowing capacity | $ 600,000,000 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Oct. 14, 2021 | Sep. 30, 2022 | Aug. 18, 2022 | Jul. 01, 2022 | |
Debt Instrument [Line Items] | ||||
Line of Credit Facility, Additional Borrowing Capacity | $ 100 | |||
Amount of borrowings drawn | $ 0 | |||
Carrying Amount | Term Loan A1 | ||||
Debt Instrument [Line Items] | ||||
Senior Notes | 600 | $ 600 | ||
Carrying Amount | Term Loan A2 | ||||
Debt Instrument [Line Items] | ||||
Senior Notes | 600 | 600 | ||
Carrying Amount | Term Loan A3 | ||||
Debt Instrument [Line Items] | ||||
Senior Notes | $ 600 | $ 0 | ||
Term Loan A2 | Minimum | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||
Term Loan A2 | Maximum | ||||
Debt Instrument [Line Items] | ||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | |||
Term Loan | Term Loan | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 1,200 | |||
Term Loan | Term Loan A2 | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | 600 | |||
Revolving Credit Facility | 2019 Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Line of credit facility, maximum borrowing capacity | $ 1,750 |
Debt (Future principal payments
Debt (Future principal payments on long-term debt) (Details) $ in Millions | Sep. 30, 2022 USD ($) |
Debt Disclosure [Abstract] | |
Remainder of 2023 | $ 608 |
2024 | 614 |
2025 | 627 |
2026 | 629 |
2027 | 649 |
Thereafter | 3,188 |
Total | $ 6,315 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense (benefit) | $ (2) | $ 7 |
Net discrete tax expense | (7) | $ (10) |
Unrecognized tax benefits, period increase (decrease) | 1 | |
Unrecognized Tax Benefits | $ 115 | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 25% | 25% |
Restructuring and Exit Costs -
Restructuring and Exit Costs - Narrative (Details) $ in Millions | 3 Months Ended | ||
Oct. 24, 2022 USD ($) numberOfEmployees | Sep. 30, 2022 USD ($) | Oct. 01, 2021 USD ($) | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring and other, net | $ 9 | $ 1 | |
Subsequent Event | |||
Restructuring Cost and Reserve [Line Items] | |||
Expected number of employees terminated | numberOfEmployees | 3,000 | ||
Approximate headcount reduction, percent | 8% | ||
Minimum | Subsequent Event | |||
Restructuring Cost and Reserve [Line Items] | |||
Expected restructuring charges | $ 60 | ||
Maximum | Subsequent Event | |||
Restructuring Cost and Reserve [Line Items] | |||
Expected restructuring charges | $ 70 |
Restructuring and Exit Costs _2
Restructuring and Exit Costs - Restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Restructuring Reserve [Roll Forward] | ||
Restructuring charges | $ 9 | $ 1 |
Workforce Reduction Costs | Other Restructuring Plans | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring accrual, beginning balance | 0 | |
Restructuring charges | 9 | |
Cash payments | (3) | |
Restructuring accrual, ending balance | 6 | |
Total costs incurred inception to date as of September 30, 2022 | 72 | |
Total expected charges to be incurred as of September 30, 2022 | 0 | |
Facilities and Other Exit Costs | Other Restructuring Plans | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring accrual, beginning balance | 5 | |
Restructuring charges | 0 | |
Cash payments | (1) | |
Restructuring accrual, ending balance | 4 | |
Total costs incurred inception to date as of September 30, 2022 | 24 | |
Total expected charges to be incurred as of September 30, 2022 | 1 | |
Total | ||
Restructuring Reserve [Roll Forward] | ||
Restructuring accrual, beginning balance | 5 | |
Restructuring charges | 9 | |
Cash payments | (4) | |
Restructuring accrual, ending balance | 10 | |
Total costs incurred inception to date as of September 30, 2022 | 96 | |
Total expected charges to be incurred as of September 30, 2022 | $ 1 |
Derivative Financial Instrume_3
Derivative Financial Instruments Derivative Financial Instruments (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Sep. 26, 2022 | Sep. 30, 2022 | Oct. 01, 2021 | Jul. 01, 2022 | |
Term Loan A1 | ||||
Derivative Financial Instruments | ||||
Derivative, notional amount | $ 600 | |||
Term Loan A2 | ||||
Derivative Financial Instruments | ||||
Derivative, notional amount | 1,000 | |||
Cash Flow Hedging | ||||
Derivative Financial Instruments | ||||
Unrealized Gain (Loss) on Cash Flow Hedging Instruments | 23 | $ 51 | ||
Cash Flow Hedge Gain (Loss) to be Reclassified During Next 12 Months | (3) | |||
Cash Flow Hedging | Cost of Sales | ||||
Derivative Financial Instruments | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | (7) | $ (2) | ||
Cash Flow Hedging | Interest Expense | ||||
Derivative Financial Instruments | ||||
Derivative Instruments, Loss Reclassified from Accumulated OCI into Income, Effective Portion | (2) | $ (1) | ||
Interest rate swap | ||||
Derivative Financial Instruments | ||||
Cash proceeds from cash flow hedge | $ 110 | |||
Realized gain on cash flow hedge | $ 110 | |||
Interest rate swap | Contracts Designated as Hedges | ||||
Derivative Financial Instruments | ||||
Derivative, notional amount | 1,600 | |||
Total return swap | Contracts Not Designated as Hedges | ||||
Derivative Financial Instruments | ||||
Derivative, notional amount | $ 98 |
Derivative Financial Instrume_4
Derivative Financial Instruments Derivative Financial Instruments (Schedule of notional value of outstanding foreign currency forward exchange contracts) (Details) - Foreign currency forward exchange contracts - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 |
Contracts Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | $ 453 | $ 467 |
Contracts Not Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 173 | 126 |
Singapore Dollar | Contracts Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 171 | 178 |
Singapore Dollar | Contracts Not Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 72 | 52 |
Thai Baht | Contracts Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 132 | 133 |
Thai Baht | Contracts Not Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 47 | 35 |
Chinese Renminbi | Contracts Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 89 | 92 |
Chinese Renminbi | Contracts Not Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 30 | 24 |
British Pound Sterling | Contracts Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | 61 | 64 |
British Pound Sterling | Contracts Not Designated as Hedges | ||
Derivative Financial Instruments | ||
Derivative, notional amount | $ 24 | $ 15 |
Derivative Financial Instrume_5
Derivative Financial Instruments Derivative Financial Instruments (Schedule of gross fair value of derivative instruments) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 |
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | $ 9 | $ 65 |
Derivative liability, fair value, gross liability | (54) | (23) |
Foreign currency forward exchange contracts | Contracts Designated as Hedges | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Foreign currency forward exchange contracts | Contracts Designated as Hedges | Accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, fair value, gross liability | (29) | (14) |
Foreign currency forward exchange contracts | Contracts Not Designated as Hedges | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Foreign currency forward exchange contracts | Contracts Not Designated as Hedges | Accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, fair value, gross liability | (11) | (5) |
Interest rate swap | Contracts Designated as Hedges | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 9 | 65 |
Interest rate swap | Contracts Designated as Hedges | Accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, fair value, gross liability | (3) | 0 |
Total return swap | Contracts Not Designated as Hedges | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative asset, fair value, gross asset | 0 | 0 |
Total return swap | Contracts Not Designated as Hedges | Accrued expenses | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liability, fair value, gross liability | $ (11) | $ (4) |
Derivative Financial Instrume_6
Derivative Financial Instruments - Effect of Derivative Instruments on Income (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 26, 2022 | Sep. 30, 2022 | Oct. 01, 2021 | |
Foreign currency forward exchange contracts | Other, net | |||
Derivative Financial Instruments | |||
Amount of Gain/(Loss) Recognized in Income on Derivatives | $ (10) | $ (4) | |
Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) | (20) | (9) | |
Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | (7) | (2) | |
Amount of Gain/(Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) | (1) | 1 | |
Total return swap | Operating expenses | |||
Derivative Financial Instruments | |||
Amount of Gain/(Loss) Recognized in Income on Derivatives | (8) | (1) | |
Interest rate swap | |||
Derivative Financial Instruments | |||
Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) | $ 110 | ||
Interest rate swap | Other, net | |||
Derivative Financial Instruments | |||
Amount of Gain/(Loss) Recognized in OCI on Derivatives (Effective Portion) | 52 | 0 | |
Amount of Gain/(Loss) Reclassified from Accumulated OCI into Income (Effective Portion) | 2 | (1) | |
Amount of Gain/(Loss) Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing) | $ 0 | $ 0 |
Fair Value (Schedule of Fair Va
Fair Value (Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis) (Details) - Recurring basis - USD ($) $ in Thousands | Sep. 30, 2022 | Jul. 01, 2022 |
Assets: | ||
Total cash equivalents | $ 158,000 | $ 59,000 |
Restricted cash and investments: | ||
Total assets | 185,000 | 149,000 |
Liabilities: | ||
Total liabilities | 54,000 | (23,000) |
Money market funds | ||
Assets: | ||
Total cash equivalents | 158,000 | 59,000 |
Restricted cash and investments: | ||
Restricted cash and investments: | 1,000 | 1,000 |
Time deposits and certificates of deposit | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 1,000 | 1,000 |
Other debt securities | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 16,000 | 23,000 |
Quoted Prices in Active Markets for Identical Instruments (Level 1) | ||
Assets: | ||
Total cash equivalents | 158,000 | 59,000 |
Restricted cash and investments: | ||
Total assets | 159,000 | 60,000 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Money market funds | ||
Assets: | ||
Total cash equivalents | 158,000 | 59,000 |
Restricted cash and investments: | ||
Restricted cash and investments: | 1,000 | 1,000 |
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Time deposits and certificates of deposit | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 0 | 0 |
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Other debt securities | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Total cash equivalents | 0 | 0 |
Restricted cash and investments: | ||
Total assets | 10,000 | 66,000 |
Liabilities: | ||
Total liabilities | 54,000 | (23,000) |
Significant Other Observable Inputs (Level 2) | Money market funds | ||
Assets: | ||
Total cash equivalents | 0 | 0 |
Restricted cash and investments: | ||
Restricted cash and investments: | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Time deposits and certificates of deposit | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 1,000 | 1,000 |
Significant Other Observable Inputs (Level 2) | Other debt securities | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Total cash equivalents | 0 | 0 |
Restricted cash and investments: | ||
Total assets | 16,000 | 23,000 |
Liabilities: | ||
Total liabilities | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Money market funds | ||
Assets: | ||
Total cash equivalents | 0 | 0 |
Restricted cash and investments: | ||
Restricted cash and investments: | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Time deposits and certificates of deposit | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Other debt securities | ||
Restricted cash and investments: | ||
Restricted cash and investments: | 16,000 | 23,000 |
Derivative assets | ||
Restricted cash and investments: | ||
Derivative assets | 9,000 | 65,000 |
Derivative assets | Quoted Prices in Active Markets for Identical Instruments (Level 1) | ||
Restricted cash and investments: | ||
Derivative assets | 0 | 0 |
Derivative assets | Significant Other Observable Inputs (Level 2) | ||
Restricted cash and investments: | ||
Derivative assets | 9,000 | 65,000 |
Derivative assets | Significant Unobservable Inputs (Level 3) | ||
Restricted cash and investments: | ||
Derivative assets | 0 | 0 |
Derivative liabilities | ||
Liabilities: | ||
Derivative liabilities | 54,000 | (23,000) |
Derivative liabilities | Quoted Prices in Active Markets for Identical Instruments (Level 1) | ||
Liabilities: | ||
Derivative liabilities | 0 | 0 |
Derivative liabilities | Significant Other Observable Inputs (Level 2) | ||
Liabilities: | ||
Derivative liabilities | 54,000 | (23,000) |
Derivative liabilities | Significant Unobservable Inputs (Level 3) | ||
Liabilities: | ||
Derivative liabilities | $ 0 | $ 0 |
Fair Value (Schedule of Fair _2
Fair Value (Schedule of Fair Value, by Balance Sheet Grouping, Measured on Recurring Basis) (Details) - Recurring basis - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 |
Assets: | ||
Cash and cash equivalents | $ 158 | $ 59 |
Other current assets | 11 | 67 |
Other assets, net | 16 | 23 |
Total assets | 185 | 149 |
Liabilities: | ||
Accrued expenses | 54 | 23 |
Total liabilities | 54 | (23) |
Quoted Prices in Active Markets for Identical Instruments (Level 1) | ||
Assets: | ||
Cash and cash equivalents | 158 | 59 |
Other current assets | 1 | 1 |
Other assets, net | 0 | 0 |
Total assets | 159 | 60 |
Liabilities: | ||
Accrued expenses | 0 | 0 |
Total liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Other current assets | 10 | 66 |
Other assets, net | 0 | 0 |
Total assets | 10 | 66 |
Liabilities: | ||
Accrued expenses | 54 | 23 |
Total liabilities | 54 | (23) |
Significant Unobservable Inputs (Level 3) | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Other current assets | 0 | 0 |
Other assets, net | 16 | 23 |
Total assets | 16 | 23 |
Liabilities: | ||
Accrued expenses | 0 | 0 |
Total liabilities | $ 0 | $ 0 |
Fair Value (Narrative) (Details
Fair Value (Narrative) (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 30, 2022 | Oct. 01, 2021 | Jul. 01, 2022 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | |||
Income (loss) from equity method investments | $ (3) | $ 3 | |
Equity Method Investments | 58 | $ 61 | |
Net gains (losses) from investment under measurement alternative | 3 | 6 | |
Equity Securities without Readily Determinable Fair Value, Amount | $ 99 | $ 88 | |
Other, net | Cost-method investments | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | |||
Equity Securities without Readily Determinable Fair Value, Downward Price Adjustment, Annual Amount | $ 5 |
Fair Value (Schedule of Carryin
Fair Value (Schedule of Carrying Values and Estimated Fair Values of Debt Instruments) (Details) - USD ($) $ in Millions | Sep. 30, 2022 | Jul. 01, 2022 | Dec. 08, 2020 | Jun. 18, 2020 | Jun. 10, 2020 | Feb. 03, 2017 | May 14, 2015 | Dec. 02, 2014 | May 28, 2014 | May 22, 2013 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Less: current portion of debt, net of debt issuance costs | $ (636) | $ (584) | ||||||||
Long-term debt, less current portion | 5,613 | 5,062 | ||||||||
4.750% Senior Notes due June 2023 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 4.75% | |||||||||
4.875% Senior Notes due March 2024 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 4.875% | |||||||||
4.750% Senior Notes due January 2025 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 4.75% | |||||||||
4.875% Senior Notes due June 2027 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 4.875% | |||||||||
4.091% Senior Notes due June 2029 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 4.091% | |||||||||
3.125% Senior Notes due July 2029 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 3.125% | |||||||||
4.125% Senior Notes due January 2031 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 4.125% | |||||||||
3.375% Senior Notes due July 2031 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 3.375% | |||||||||
3.375% Senior Notes due July 2031 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 3.375% | |||||||||
5.750% Senior Notes due December 2034 | Senior Notes | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Stated interest rate (as a percent) | 5.75% | |||||||||
Carrying Amount | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Long-term debt, gross | 6,279 | 5,677 | ||||||||
Less: unamortized debt issuance costs | (30) | (31) | ||||||||
Debt, net of debt issuance costs | 6,249 | 5,646 | ||||||||
Less: current portion of debt, net of debt issuance costs | (636) | (584) | ||||||||
Long-term debt, less current portion | 5,613 | 5,062 | ||||||||
Carrying Amount | 4.750% Senior Notes due June 2023 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 540 | 540 | ||||||||
Carrying Amount | 4.875% Senior Notes due March 2024 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 499 | 499 | ||||||||
Carrying Amount | 4.750% Senior Notes due January 2025 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 479 | 479 | ||||||||
Carrying Amount | 4.875% Senior Notes due June 2027 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 504 | 504 | ||||||||
Carrying Amount | 4.091% Senior Notes due June 2029 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 468 | 466 | ||||||||
Carrying Amount | 3.125% Senior Notes due July 2029 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 500 | 500 | ||||||||
Carrying Amount | 4.125% Senior Notes due January 2031 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 500 | 500 | ||||||||
Carrying Amount | 3.375% Senior Notes due July 2031 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 500 | 500 | ||||||||
Carrying Amount | 5.750% Senior Notes due December 2034 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 489 | 489 | ||||||||
Carrying Amount | Term Loan A1 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 600 | 600 | ||||||||
Carrying Amount | Term Loan A2 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 600 | 600 | ||||||||
Carrying Amount | Term Loan A3 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 600 | 0 | ||||||||
Estimated Fair Value | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Long-term debt, gross | 5,569 | 5,219 | ||||||||
Less: unamortized debt issuance costs | 0 | 0 | ||||||||
Debt, net of debt issuance costs | 5,569 | 5,219 | ||||||||
Less: current portion of debt, net of debt issuance costs | (630) | (582) | ||||||||
Long-term debt, less current portion | 4,939 | 4,637 | ||||||||
Estimated Fair Value | 4.750% Senior Notes due June 2023 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 537 | 538 | ||||||||
Estimated Fair Value | 4.875% Senior Notes due March 2024 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 489 | 494 | ||||||||
Estimated Fair Value | 4.750% Senior Notes due January 2025 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 457 | 471 | ||||||||
Estimated Fair Value | 4.875% Senior Notes due June 2027 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 457 | 483 | ||||||||
Estimated Fair Value | 4.091% Senior Notes due June 2029 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 396 | 427 | ||||||||
Estimated Fair Value | 3.125% Senior Notes due July 2029 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 368 | 396 | ||||||||
Estimated Fair Value | 4.125% Senior Notes due January 2031 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 375 | 410 | ||||||||
Estimated Fair Value | 3.375% Senior Notes due July 2031 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 350 | 393 | ||||||||
Estimated Fair Value | 5.750% Senior Notes due December 2034 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 386 | 433 | ||||||||
Estimated Fair Value | LIBOR Based Term Loan A1 due September 2025 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 589 | 588 | ||||||||
Estimated Fair Value | LIBOR Based Term Loan A2 due July 2027 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | 581 | 586 | ||||||||
Estimated Fair Value | LIBOR based Term Loan Due September 2025 | ||||||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||||||
Senior Notes | $ 584 | $ 0 |
Equity (Narrative) (Details)
Equity (Narrative) (Details) | 3 Months Ended |
Sep. 30, 2022 USD ($) $ / shares shares | |
Equity [Abstract] | |
Authorized share capital (in dollars) | $ | $ 13,500 |
Ordinary shares, authorized (in shares) | 1,250,000,000 |
Ordinary shares, par value (in dollars per share) | $ / shares | $ 0.00001 |
Ordinary shares, outstanding (in shares) | 206,434,139 |
Preferred shares, authorized (in shares) | 100,000,000 |
Preferred shares, par value (in dollars per share) | $ / shares | $ 0.00001 |
Preferred shares, issued (in shares) | 0 |
Preferred shares, outstanding (in shares) | 0 |
Common stock, voting rights | one vote per share |
Preferred stock minimum number of series | 1 |
Stock repurchase program, remaining authorized repurchase amount | $ | $ 1,900,000,000 |
Equity (Schedule of Share Repur
Equity (Schedule of Share Repurchases) (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Dollar Value [Abstract] | ||
Repurchases of ordinary shares (in shares) | 5 | |
Tax withholding related to vesting of equity awards (in shares) | 1 | |
Repurchases of ordinary shares and tax withholding related to vesting of equity awards (in shares) | 6 | |
Repurchases of ordinary shares (1) | $ 400 | $ 425 |
Tax withholding related to vesting of equity awards | 39 | $ 43 |
Repurchases of ordinary shares and tax withholding related to vesting of equity awards | $ 439 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 2,035 | $ 3,115 |
Asia Pacific | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 801 | 1,583 |
Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 936 | 1,079 |
EMEA | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 298 | 453 |
OEMs | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 1,545 | 2,288 |
Distributors | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | 299 | 507 |
Retailers | ||
Disaggregation of Revenue [Line Items] | ||
Revenue | $ 191 | $ 320 |
Guarantees Guarantees (Narrativ
Guarantees Guarantees (Narrative) (Details) | 3 Months Ended |
Sep. 30, 2022 USD ($) | |
Schedule of Fiscal Years [Line Items] | |
Intellectual property indemnification obligations | $ 0 |
Minimum | |
Schedule of Fiscal Years [Line Items] | |
Product warranty period term | 1 year |
Maximum | |
Schedule of Fiscal Years [Line Items] | |
Product warranty period term | 5 years |
Guarantees (Product Warranty) (
Guarantees (Product Warranty) (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Product Warranty Liability [Roll Forward] | ||
Balance, beginning of period | $ 148 | $ 136 |
Warranties issued | 13 | 21 |
Repairs and replacements | (24) | (23) |
Changes in liability for pre-existing warranties, including expirations | 12 | 6 |
Balance, end of period | $ 149 | $ 140 |
Earnings Per Share (Schedule of
Earnings Per Share (Schedule of computation of basic and diluted net income (loss) per share) (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Sep. 30, 2022 | Oct. 01, 2021 | |
Numerator: | ||
Net income | $ 29 | $ 526 |
Number of shares used in per share calculations: | ||
Total shares for purposes of calculating basic net income per share | 208 | 226 |
Weighted-average effect of dilutive securities: | ||
Employee equity award plans | 2 | 5 |
Total shares for purposes of calculating diluted net income per share | 210 | 231 |
Net income per share: | ||
Basic (in dollars per share) | $ 0.14 | $ 2.33 |
Diluted (in dollars per share) | $ 0.14 | $ 2.28 |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | 3 Months Ended | ||
Oct. 26, 2022 | Sep. 30, 2022 | Oct. 01, 2021 | |
Subsequent Event [Line Items] | |||
Cash dividends declared per ordinary share (in dollars per share) | $ 0.70 | $ 0.67 | |
Common Stock | Subsequent Event | |||
Subsequent Event [Line Items] | |||
Cash dividends declared per ordinary share (in dollars per share) | $ 0.70 | ||
Dividends payable date | Jan. 05, 2023 | ||
Dividends payable, date of record | Dec. 21, 2022 |