Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Sep. 29, 2017 | Nov. 09, 2017 | Mar. 31, 2017 | |
Document and Entity Information | |||
Entity Registrant Name | TE Connectivity Ltd. | ||
Entity Central Index Key | 1,385,157 | ||
Document Type | 10-K | ||
Document Period End Date | Sep. 29, 2017 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --09-29 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 26.4 | ||
Entity Common Stock, Shares Outstanding | 351,637,204 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | |||
Net sales | $ 13,113 | $ 12,238 | $ 12,233 |
Cost of sales | 8,663 | 8,205 | 8,146 |
Gross margin | 4,450 | 4,033 | 4,087 |
Selling, general, and administrative expenses | 1,591 | 1,463 | 1,504 |
Research, development, and engineering expenses | 658 | 644 | 627 |
Acquisition and integration costs | 6 | 22 | 55 |
Restructuring and other charges, net | 148 | 2 | 152 |
Operating income | 2,047 | 1,902 | 1,749 |
Interest income | 20 | 19 | 17 |
Interest expense | (130) | (127) | (136) |
Other expense, net | (9) | (632) | (55) |
Income from continuing operations before income taxes | 1,928 | 1,162 | 1,575 |
Income tax (expense) benefit | (255) | 779 | (337) |
Income from continuing operations | 1,673 | 1,941 | 1,238 |
Income from discontinued operations, net of income taxes | 10 | 68 | 1,182 |
Net income | $ 1,683 | $ 2,009 | $ 2,420 |
Basic earnings per share: | |||
Income from continuing operations (in dollars per share) | $ 4.71 | $ 5.30 | $ 3.06 |
Income from discontinued operations (in dollars per share) | 0.03 | 0.19 | 2.92 |
Net income (in dollars per share) | 4.74 | 5.49 | 5.98 |
Diluted earnings per share: | |||
Income from continuing operations (in dollars per share) | 4.67 | 5.26 | 3.01 |
Income from discontinued operations (in dollars per share) | 0.03 | 0.18 | 2.88 |
Net income (in dollars per share) | 4.70 | 5.44 | 5.89 |
Dividends paid per common share | $ 1.54 | $ 1.40 | $ 1.24 |
Weighted-average number of shares outstanding: | |||
Basic (in shares) | 355 | 366 | 405 |
Diluted (in shares) | 358 | 369 | 411 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME | |||
Net income | $ 1,683 | $ 2,009 | $ 2,420 |
Other comprehensive income (loss): | |||
Currency translation | 37 | (92) | (312) |
Adjustments to unrecognized pension and postretirement benefit costs, net of income taxes | 330 | (88) | (46) |
Gains on cash flow hedges, net of income taxes | 15 | 11 | 2 |
Other comprehensive income (loss) | 382 | (169) | (356) |
Comprehensive income | $ 2,065 | $ 1,840 | $ 2,064 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 1,218 | $ 647 |
Accounts receivable, net of allowance for doubtful accounts of $21 and $17, respectively | 2,290 | 2,046 |
Inventories | 1,813 | 1,596 |
Prepaid expenses and other current assets | 605 | 486 |
Total current assets | 5,926 | 4,775 |
Property, plant, and equipment, net | 3,400 | 3,052 |
Goodwill | 5,651 | 5,492 |
Intangible assets, net | 1,841 | 1,879 |
Deferred income taxes | 2,141 | 2,111 |
Other assets | 444 | 299 |
Total Assets | 19,403 | 17,608 |
Current liabilities: | ||
Short-term debt | 710 | 331 |
Accounts payable | 1,436 | 1,090 |
Accrued and other current liabilities | 1,626 | 1,437 |
Deferred revenue | 75 | 208 |
Total current liabilities | 3,847 | 3,066 |
Long-term debt | 3,634 | 3,739 |
Long-term pension and postretirement liabilities | 1,160 | 1,502 |
Deferred income taxes | 236 | 207 |
Income taxes | 293 | 247 |
Other liabilities | 482 | 362 |
Total Liabilities | 9,652 | 9,123 |
Commitments and contingencies (Note 12) | ||
Shareholders' equity: | ||
Common shares, CHF 0.57 par value, 357,069,981 shares authorized and issued, and 382,835,381 shares authorized and issued, respectively | 157 | 168 |
Contributed surplus | 0 | 1,801 |
Accumulated earnings | 10,175 | 8,682 |
Treasury shares, at cost, 5,356,369 and 27,554,005 shares, respectively | (421) | (1,624) |
Accumulated other comprehensive loss | (160) | (542) |
Total Shareholders' Equity | 9,751 | 8,485 |
Total Liabilities and Shareholders' Equity | $ 19,403 | $ 17,608 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Millions | Sep. 29, 2017SFr / shares | Sep. 29, 2017USD ($)shares | Sep. 30, 2016SFr / shares | Sep. 30, 2016USD ($)shares |
CONSOLIDATED BALANCE SHEETS | ||||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ | $ 21 | $ 17 | ||
Common shares, par value (in currency per share) | SFr / shares | SFr 0.57 | SFr 0.57 | ||
Common shares, shares authorized | 357,069,981 | 382,835,381 | ||
Common shares, shares issued | 357,069,981 | 382,835,381 | ||
Treasury shares | 5,356,369 | 27,554,005 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - USD ($) shares in Millions, $ in Millions | Common Shares | Treasury Shares | Contributed Surplus | Accumulated Earnings | Accumulated Other Comprehensive Loss | Total |
Balance at Sep. 26, 2014 | $ 184 | $ (644) | $ 5,231 | $ 4,253 | $ (17) | $ 9,007 |
Balance (in shares) at Sep. 26, 2014 | 419 | (11) | ||||
Increase (Decrease) in Equity: | ||||||
Net income | 2,420 | 2,420 | ||||
Other comprehensive loss | (356) | (356) | ||||
Share-based compensation expense | 95 | 95 | ||||
Dividends approved | (526) | (526) | ||||
Exercise of share options | $ 103 | 103 | ||||
Exercise of share options (in shares) | 3 | |||||
Restricted share award vestings and other activity | $ 143 | (138) | 5 | |||
Restricted share award vestings and other activity (in shares) | 1 | |||||
Repurchase of common shares | $ (1,163) | $ (1,163) | ||||
Repurchase of common shares (in shares) | (18) | (18) | ||||
Cancellation of treasury shares | $ (2) | $ 305 | (303) | |||
Cancellation of treasury shares (in shares) | (5) | 5 | 5 | |||
Balance at Sep. 25, 2015 | $ 182 | $ (1,256) | 4,359 | 6,673 | (373) | $ 9,585 |
Balance (in shares) at Sep. 25, 2015 | 414 | (20) | ||||
Increase (Decrease) in Equity: | ||||||
Net income | 2,009 | 2,009 | ||||
Other comprehensive loss | (169) | (169) | ||||
Share-based compensation expense | 91 | 91 | ||||
Dividends approved | (512) | (512) | ||||
Exercise of share options | $ 90 | 90 | ||||
Exercise of share options (in shares) | 2 | |||||
Restricted share award vestings and other activity | $ 146 | (145) | 1 | |||
Restricted share award vestings and other activity (in shares) | 2 | |||||
Repurchase of common shares | $ (2,610) | $ (2,610) | ||||
Repurchase of common shares (in shares) | (43) | (43) | ||||
Cancellation of treasury shares | $ (14) | $ 2,006 | (1,992) | |||
Cancellation of treasury shares (in shares) | (31) | 31 | 31 | |||
Balance at Sep. 30, 2016 | $ 168 | $ (1,624) | 1,801 | 8,682 | (542) | $ 8,485 |
Balance (in shares) at Sep. 30, 2016 | 383 | (28) | ||||
Increase (Decrease) in Equity: | ||||||
Adoption of ASU No. 2016-09 | Accounting Standards Update 2016-09 | 165 | 165 | ||||
Net income | 1,683 | 1,683 | ||||
Other comprehensive loss | 382 | 382 | ||||
Share-based compensation expense | 99 | 99 | ||||
Dividends approved | (564) | (564) | ||||
Exercise of share options | $ 117 | 117 | ||||
Exercise of share options (in shares) | 3 | |||||
Restricted share award vestings and other activity | $ 195 | (184) | (6) | 5 | ||
Restricted share award vestings and other activity (in shares) | 2 | |||||
Repurchase of common shares | $ (621) | $ (621) | ||||
Repurchase of common shares (in shares) | (8) | (8) | ||||
Cancellation of treasury shares | $ (11) | $ 1,512 | $ (1,152) | (349) | ||
Cancellation of treasury shares (in shares) | (26) | 26 | 26 | |||
Balance at Sep. 29, 2017 | $ 157 | $ (421) | $ 10,175 | $ (160) | $ 9,751 | |
Balance (in shares) at Sep. 29, 2017 | 357 | (5) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Cash Flows From Operating Activities: | |||
Net income | $ 1,683 | $ 2,009 | $ 2,420 |
Income from discontinued operations, net of income taxes | (10) | (68) | (1,182) |
Income from continuing operations | 1,673 | 1,941 | 1,238 |
Adjustments to reconcile income from continuing operations to net cash provided by operating activities: | |||
Depreciation and amortization | 635 | 585 | 616 |
Deferred income taxes | (75) | 178 | 40 |
Provision for losses on accounts receivable and inventories | 19 | 17 | 36 |
Tax sharing expense | 8 | 632 | 52 |
Share-based compensation expense | 99 | 91 | 89 |
Gain on divestiture | (144) | ||
Other | 10 | 102 | 126 |
Changes in assets and liabilities, net of the effects of acquisitions and divestitures: | |||
Accounts receivable, net | (253) | 116 | (210) |
Inventories | (211) | 16 | (220) |
Prepaid expenses and other current assets | (72) | 282 | 36 |
Accounts payable | 308 | (75) | (5) |
Accrued and other current liabilities | 225 | (4) | (155) |
Deferred revenue | (137) | 26 | 12 |
Income taxes | 7 | (1,764) | (52) |
Other | 86 | 45 | 33 |
Net cash provided by continuing operating activities | 2,322 | 2,044 | 1,636 |
Net cash provided by (used in) discontinued operating activities | (1) | (97) | 294 |
Net cash provided by operating activities | 2,321 | 1,947 | 1,930 |
Cash Flows From Investing Activities: | |||
Capital expenditures | (702) | (628) | (600) |
Proceeds from sale of property, plant, and equipment | 19 | 8 | 17 |
Acquisition of businesses, net of cash acquired | (250) | (1,336) | (1,725) |
Proceeds from divestiture of business, net of cash retained by sold business | 4 | 333 | |
Proceeds from divestiture of discontinued operations, net of cash retained by sold operations | (19) | 2,957 | |
Other | (3) | 61 | 12 |
Net cash provided by (used in) continuing investing activities | (932) | (1,581) | 661 |
Net cash used in discontinued investing activities | (25) | ||
Net cash provided by (used in) investing activities | (932) | (1,581) | 636 |
Cash Flows From Financing Activities: | |||
Net increase (decrease) in commercial paper | (330) | 330 | (328) |
Proceeds from issuance of debt | 589 | 352 | 617 |
Repayment of debt | (501) | (473) | |
Proceeds from exercise of share options | 117 | 90 | 103 |
Repurchase of common shares | (614) | (2,787) | (1,023) |
Payment of common share dividends to shareholders | (546) | (509) | (502) |
Transfers (to) from discontinued operations | (1) | (97) | 269 |
Other | (30) | (30) | (17) |
Net cash used in continuing financing activities | (815) | (3,152) | (1,354) |
Net cash provided by (used in) discontinued financing activities | 1 | 97 | (269) |
Net cash used in financing activities | (814) | (3,055) | (1,623) |
Effect of currency translation on cash | (4) | 7 | (71) |
Net increase (decrease) in cash and cash equivalents | 571 | (2,682) | 872 |
Cash and cash equivalents at beginning of fiscal year | 647 | 3,329 | 2,457 |
Cash and cash equivalents at end of fiscal year | 1,218 | 647 | 3,329 |
Supplemental Cash Flow Information: | |||
Interest paid | 128 | 117 | 128 |
Income taxes paid, net of refunds | $ 323 | $ 806 | $ 350 |
Basis of Presentation
Basis of Presentation | 12 Months Ended |
Sep. 29, 2017 | |
Basis of Presentation | |
Basis of Presentation | 1. Basis of Presentation The Consolidated Financial Statements reflect the consolidated operations of TE Connectivity Ltd. and its subsidiaries and have been prepared in United States ("U.S.") dollars in accordance with accounting principles generally accepted in the U.S. ("GAAP"). Description of the Business TE Connectivity Ltd. ("TE Connectivity" or the "Company," which may be referred to as "we," "us," or "our") is a global technology and manufacturing leader creating a safer, sustainable, productive, and connected future. For more than 75 years, our connectivity and sensor solutions, proven in the harshest environments, have enabled advancements in transportation, industrial applications, medical technology, energy, data communications, and the home. We operate through three reportable segments: • Transportation Solutions. The Transportation Solutions segment is a leader in connectivity and sensor technologies. Our products, which must withstand harsh conditions, are used in the automotive, commercial transportation, and sensors markets. • Industrial Solutions. The Industrial Solutions segment is a leading supplier of products that connect and distribute power, data, and signals. Our products are used in the industrial equipment; aerospace, defense, oil, and gas; and energy markets. • Communications Solutions. The Communications Solutions segment is a leading supplier of electronic components for the data and devices and the appliances markets. We are also a leader in developing, manufacturing, installing, and maintaining some of the world's most advanced subsea fiber optic communications systems. Use of Estimates The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses. Significant estimates in these Consolidated Financial Statements include restructuring and other charges, assets acquired and liabilities assumed in acquisitions, allowances for doubtful accounts receivable, estimates of future cash flows and discount rates associated with asset impairments, useful lives for depreciation and amortization, loss contingencies, net realizable value of inventories, estimated contract revenue and related costs, legal contingencies, tax reserves and deferred tax asset valuation allowances, and the determination of discount and other rate assumptions for pension benefit cost. Actual results could differ materially from these estimates. Fiscal Year We have a 52- or 53-week fiscal year that ends on the last Friday of September. For fiscal years in which there are 53 weeks, the fourth quarter reporting period includes 14 weeks. Fiscal 2017, 2016, and 2015 ended on September 29, 2017, September 30, 2016, and September 25, 2015, respectively. Fiscal 2017 and 2015 were 52 weeks in length. Fiscal 2016 was a 53-week year. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 29, 2017 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | 2. Summary of Significant Accounting Policies Principles of Consolidation We consolidate entities in which we own or control more than 50% of the voting shares or otherwise have the ability to control through similar rights. All intercompany transactions have been eliminated. The results of companies acquired or disposed of are included on the Consolidated Financial Statements from the effective date of acquisition or up to the date of disposal. Revenue Recognition Our revenues are generated principally from the sale of our products. Revenue from the sale of products is recognized at the time title and the risks and rewards of ownership pass to the customer. This generally occurs when the products reach the shipping point, the sales price is fixed and determinable, and collection is reasonably assured. Contract revenues for construction related projects, which are generated in the Communications Solutions segment, are recorded primarily using the percentage-of-completion method. Profits recognized on contracts in process are based upon estimated contract revenue and related cost to complete. Percentage-of-completion is measured based on the ratio of actual costs incurred to total estimated costs. Revisions in cost estimates as contracts progress have the effect of increasing or decreasing profits in the current period. Provisions for anticipated losses are made in the period in which they first become determinable. In addition, provisions for credit losses related to unbilled receivables on construction related projects are recorded as reductions of revenue in the period in which they first become determinable. We generally warrant that our products will conform to our, or mutually agreed to, specifications and that our products will be free from material defects in materials and workmanship for a limited time. We limit our warranty to the replacement or repair of defective parts, or a refund or credit of the price of the defective product. We accept returned goods only when the customer makes a verified claim and we have authorized the return. Generally, a reserve for estimated returns is established at the time of sale based on historical return experience and is recorded as a reduction of sales. Additionally, certain of our long-term contracts in the Communications Solutions segment have warranty obligations. Estimated warranty costs for each contract are determined based on the contract terms and technology-specific considerations. These costs are included in total estimated contract costs and are accrued over the construction period of the respective contracts under percentage-of-completion accounting. We provide certain distributors with an inventory allowance for returns or scrap equal to a percentage of qualified purchases. A reserve for estimated returns and scrap allowances is established at the time of the sale based on an agreed-upon, fixed percentage of sales to distributors and is recorded as a reduction of sales. Other allowances include customer quantity and price discrepancies. A reserve for other allowances is generally established at the time of sale based on historical experience and is recorded as a reduction of sales. We believe we can reasonably and reliably estimate the amounts of future allowances. Inventories Inventories are recorded at the lower of cost or market value using the first-in, first-out cost method, except for inventoried costs incurred in the performance of long-term contracts primarily by the Communications Solutions segment. Property, Plant, and Equipment, Net Property, plant, and equipment is recorded at cost less accumulated depreciation. Maintenance and repair expenditures are charged to expense when incurred. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which are 10 to 20 years for land improvements, 5 to 40 years for buildings and improvements, and 1 to 15 years for machinery and equipment. We periodically evaluate, when events and circumstances warrant, the net realizable value of property, plant, and equipment and other long-lived assets, relying on a number of factors including operating results, business plans, economic projections, and anticipated future cash flows. When indicators of potential impairment are present, the carrying values of the asset group are evaluated in relation to the operating performance and estimated future undiscounted cash flows of the underlying asset group. Impairment of the carrying value is recognized whenever anticipated future undiscounted cash flow estimates are less than the carrying value of the asset. Fair value estimates are based on assumptions concerning the amount and timing of estimated future cash flows and discount rates, reflecting varying degrees of perceived risk. Goodwill and Other Intangible Assets Intangible assets include both indeterminable-lived residual goodwill and determinable-lived identifiable intangible assets. Intangible assets with determinable lives primarily include intellectual property, consisting of patents, trademarks, and unpatented technology, and customer relationships. Recoverability estimates range from 1 to 50 years and costs are generally amortized on a straight-line basis. Evaluations of the remaining useful lives of determinable-lived intangible assets are performed on a periodic basis and when events and circumstances warrant. At fiscal year end 2017, we had six reporting units, five of which contained goodwill. There were two reporting units in each of our three segments. When changes occur in the composition of one or more reporting units, goodwill is reassigned to the reporting units affected based on their relative fair values. Goodwill impairment is evaluated by comparing the carrying value of each reporting unit to its fair value on the first day of the fourth fiscal quarter of each year or whenever we believe a triggering event requiring a more frequent assessment has occurred. In assessing the existence of a triggering event, management relies on a number of reporting unit-specific factors including operating results, business plans, economic projections, anticipated future cash flows, transactions, and market place data. There are inherent uncertainties related to these factors and management's judgment in applying these factors to the impairment analysis. When testing for goodwill impairment, we perform a step I goodwill impairment test to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, goodwill may be impaired and a step II goodwill impairment test is performed to measure the amount of impairment, if any. In the step II goodwill impairment test, we compare the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess. The implied fair value of goodwill is determined in a manner consistent with how goodwill is recognized in a business combination. We allocate the fair value of a reporting unit to the assets and liabilities of that unit, including intangible assets, as if the reporting unit had been acquired in a business combination. Any excess of the fair value of a reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. Fair value estimates used in the step I goodwill impairment tests are calculated using an income approach based on the present value of future cash flows of each reporting unit. The income approach generally has been supported by guideline analyses (a market approach). These approaches incorporate a number of assumptions including future growth rates, discount rates, income tax rates, and market activity in assessing fair value and are reporting unit specific. Changes in economic and operating conditions impacting these assumptions could result in goodwill impairments in future periods. Research and Development Research and development expenditures are expensed when incurred and are included in research, development, and engineering expenses on the Consolidated Statements of Operations. Research and development expenses include salaries, direct costs incurred, and building and overhead expenses. The amounts expensed in fiscal 2017, 2016, and 2015 were $595 million, $566 million, and $540 million, respectively. Income Taxes Income taxes are computed in accordance with the provisions of Accounting Standards Codification ("ASC") 740, Income Taxes . Deferred tax liabilities and assets are recognized for the expected future tax consequences of events that have been reflected on the Consolidated Financial Statements. Deferred tax liabilities and assets are determined based on the differences between the book and tax bases of particular assets and liabilities and operating loss carryforwards using tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is provided to offset deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The calculation of our tax liabilities includes estimates for uncertainties in the application of complex tax regulations across multiple global jurisdictions where we conduct our operations. Under the uncertain tax position provisions of ASC 740, we recognize liabilities for tax and related interest for issues in tax jurisdictions based on our estimate of whether, and the extent to which, additional taxes and related interest will be due. These tax liabilities and related interest are reflected net of the impact of related tax loss carryforwards, as such tax loss carryforwards will be applied against these tax liabilities and will reduce the amount of cash tax payments due upon the eventual settlement with the tax authorities. These estimates may change due to changing facts and circumstances. Due to the complexity of these uncertainties, the ultimate resolution may result in a settlement that differs from our current estimate of the tax liabilities and related interest. Financial Instruments Our financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, debt, and derivative financial instruments. We account for derivative financial instrument contracts on the Consolidated Balance Sheets at fair value. For instruments not designated as hedges under ASC 815, Derivatives and Hedging , the changes in the instruments' fair value are recognized currently in earnings. For instruments designated as cash flow hedges, the effective portion of changes in the fair value of a derivative is recorded in other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the underlying hedged item affects earnings. Ineffective portions of a cash flow hedge, including amounts excluded from the hedging relationship, are recognized currently in earnings. Changes in the fair value of instruments designated as fair value hedges affect the carrying value of the asset or liability hedged, with changes in both the derivative instrument and the hedged asset or liability being recognized currently in earnings. We determine the fair value of our financial instruments by using methods and assumptions that are based on market conditions and risks existing at each balance sheet date. Standard market conventions are used to determine the fair value of financial instruments, including derivatives. The cash flows related to derivative financial instruments are reported in the operating activities section of the Consolidated Statements of Cash Flows. Our derivative financial instruments present certain market and counterparty risks. Concentration of counterparty risk is mitigated, however, by our use of financial institutions worldwide, substantially all of which have long-term Standard & Poor's, Moody's, and/or Fitch credit ratings of A/A2 or higher. In addition, we utilize only conventional derivative financial instruments. We are exposed to potential losses if a counterparty fails to perform according to the terms of its agreement. With respect to counterparty net asset positions recognized at fiscal year end 2017, we have assessed the likelihood of counterparty default as remote. We currently provide guarantees from a wholly-owned subsidiary to the counterparties to our commodity swap derivatives and exchange cash collateral with the counterparties to our cross-currency swap contracts. The likelihood of performance on the guarantees has been assessed as remote. For all other derivative financial instruments, we are not required to provide, nor do we require counterparties to provide, collateral or other security. Fair Value Measurements ASC 820, Fair Value Measurements and Disclosures , specifies a fair value hierarchy based upon the observable inputs utilized in valuation of certain assets and liabilities. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. Fair value measurements are classified under the following hierarchy: • Level 1. Quoted prices in active markets for identical assets and liabilities. • Level 2. Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3. Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flows methodologies, and similar techniques that use significant unobservable inputs. Derivative financial instruments measured at fair value on a recurring basis are generally valued using level 2 inputs. Financial instruments other than derivative instruments include cash and cash equivalents, accounts receivable, accounts payable, and debt. These instruments are recorded on the Consolidated Balance Sheets at book value. For cash and cash equivalents, accounts receivable, and accounts payable, we believe book value approximates fair value due to the short-term nature of these instruments. See Note 11 for disclosure of the fair value of debt. The following is a description of the valuation methodologies used for the respective financial instruments: • Cash and cash equivalents. Cash and cash equivalents are valued at book value, which we consider to be equivalent to unadjusted quoted prices (level 1). • Accounts receivable. Accounts receivable are valued based on the net value expected to be realized. The net realizable value generally represents an observable contractual agreement (level 2). • Accounts payable. Accounts payable are valued based on the net value expected to be paid, generally supported by an observable contractual agreement (level 2). • Debt. The fair value of debt, including both current and non-current maturities, is derived from quoted market prices or other pricing determinations based on the results of market approach valuation models using observable market data such as recently reported trades, bid and offer information, and benchmark securities (level 2). Pension Liabilities The funded status of our defined benefit pension plans is recognized on the Consolidated Balance Sheets and is measured as the difference between the fair value of plan assets and the projected benefit obligation at the measurement date. The projected benefit obligation represents the actuarial present value of benefits projected to be paid upon retirement factoring in estimated future compensation levels. The fair value of plan assets represents the current market value of cumulative company and participant contributions made to irrevocable trust funds, held for the sole benefit of participants, which are invested by the trustee of the funds. The benefits under our defined benefit pension plans are based on various factors, such as years of service and compensation. Net periodic pension benefit cost is based on the utilization of the projected unit credit method of calculation and is charged to earnings on a systematic basis over the expected average remaining service lives of current participants. The measurement of benefit obligations and net periodic benefit cost is based on estimates and assumptions determined by our management. These valuations reflect the terms of the plans and use participant-specific information such as compensation, age, and years of service, as well as certain assumptions, including estimates of discount rates, expected return on plan assets, rate of compensation increases, interest crediting rates, and mortality rates. Share-Based Compensation We determine the fair value of share awards on the date of grant. Share options are valued using the Black-Scholes-Merton valuation model; restricted share awards and performance awards are valued using our end-of-day share price on the date of grant. The fair value is expensed ratably over the expected service period, with an allowance made for estimated forfeitures based on historical employee activity. Estimates regarding the attainment of performance criteria are reviewed periodically; the cumulative impact of a change in estimate regarding the attainment of performance criteria is recorded in the period in which that change is made. Earnings Per Share Basic earnings per share is computed by dividing net income by the basic weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income by the weighted-average number of common shares outstanding adjusted for the potentially dilutive impact of share-based compensation arrangements. Currency Translation For our non-U.S. dollar functional currency subsidiaries, assets and liabilities are translated into U.S. dollars using fiscal year end exchange rates. Sales and expenses are translated at average monthly exchange rates. Foreign currency translation gains and losses are included as a component of accumulated other comprehensive income (loss) within equity. Gains and losses resulting from foreign currency transactions, which are included in earnings, were immaterial in fiscal 2017, 2016, and 2015. Restructuring Charges Restructuring activities involve employee-related termination costs, facility exit costs, and asset impairments resulting from reductions-in-force, migration of facilities or product lines from higher-cost to lower-cost countries, or consolidation of facilities within countries. We recognize termination costs based on requirements established by severance policy, government law, or previous actions. Facility exit costs generally reflect the cost to terminate a facility lease before the end of its term (measured at fair value at the time we cease using the facility) or costs that will continue to be incurred under the facility lease without future economic benefit to us. Restructuring activities often result in the disposal or abandonment of assets that require an acceleration of depreciation or impairment reflecting the excess of the assets' carrying values over fair value. The recognition of restructuring costs require that we make certain judgments and estimates regarding the nature, timing, and amount of costs associated with the planned exit activity. To the extent our actual results differ from our estimates and assumptions, we may be required to revise the estimated liabilities, requiring the recognition of additional restructuring costs or the reduction of liabilities already recognized. At the end of each reporting period, we evaluate the remaining accrued balances to ensure these balances are properly stated and the utilization of the reserves are for their intended purpose in accordance with developed exit plans. Acquisitions We account for acquired businesses using the acquisition method of accounting. This method requires, among other things, that most assets acquired and liabilities assumed be recognized at fair value as of the acquisition date. We allocate the purchase price of acquired businesses to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values, or as required by ASC 805, Business Combinations . The excess of the purchase price over the identifiable assets acquired and liabilities assumed is recorded as goodwill. We may engage independent third-party appraisal firms to assist us in determining the fair values of assets acquired and liabilities assumed. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. Contingent Liabilities We record a loss contingency when the available information indicates it is probable that we have incurred a liability and the amount of the loss is reasonably estimable. When a range of possible losses with equal likelihood exists, we record the low end of the range. The likelihood of a loss with respect to a particular contingency is often difficult to predict, and determining a meaningful estimate of the loss or a range of loss may not be practicable based on information available. In addition, it is not uncommon for such matters to be resolved over many years, during which time relevant developments and new information must continuously be evaluated to determine whether a loss is probable and a reasonable estimate of that loss can be made. When a loss is probable but a reasonable estimate cannot be made, or when a loss is at least reasonably possible, disclosure is provided. Recently Issued Accounting Pronouncements In October 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-16, an update to ASC 740, Income Taxes . This new guidance requires the recognition of the income tax consequences of intra-entity transfers of assets other than inventory in the period in which the transfer occurs. The update, which we will adopt on a modified retrospective basis, is effective for us in the first quarter of fiscal 2019. Based on amounts recorded as of September 29, 2017, adoption would result in approximately a $120 million cumulative-effect adjustment to beginning accumulated earnings and a $120 million decrease in total assets, primarily in other assets. Future transactions prior to adoption of this update could significantly change the impact at adoption. In February 2016, the FASB issued ASU No. 2016-02 which codified ASC 842, Leases . This guidance, which requires lessees to recognize a lease liability and a right-of-use asset for most leases, is effective for us in the first quarter of fiscal 2020. We will adopt the new standard using a modified retrospective transition approach which requires application of the new guidance for all periods presented. We are currently assessing the impact that adoption will have on our financial position. In May 2014, the FASB issued ASU No. 2014-09 which codified ASC topic 606, Revenue from Contracts with Customers . This guidance supersedes ASC 605, Revenue Recognition , and introduces a single, comprehensive, five-step revenue recognition model. ASC 606 also enhances disclosures related to revenue recognition. ASC 606, as amended, is effective for us in the first quarter of fiscal 2019 and allows for either a full retrospective or a modified retrospective approach at adoption. We are continuing to assess the impact of adopting ASC 606. Based on the initial evaluation of our current contracts and revenue streams, we do not expect that adoption will have a material impact on our results of operations or financial position and plan to adopt the new standard using the modified retrospective approach. We are in the process of identifying necessary changes to accounting policies, processes, financial statement disclosures, internal controls, and systems to enable compliance with this new standard. We believe we are following an appropriate timeline to allow for the proper recognition, reporting, and disclosure of revenue upon adoption of ASC 606 at the beginning of fiscal 2019. Recently Adopted Accounting Pronouncements In March 2016, the FASB issued ASU No. 2016-09, an update to ASC 718, Compensation—Stock Compensation , to simplify various aspects of accounting for share-based payments to employees. We elected to early adopt this update in fiscal 2017. The provisions of the update addressing the accounting for excess tax benefits and deficiencies were adopted using a modified retrospective transition approach, with a cumulative-effect adjustment to beginning accumulated earnings and a corresponding increase in deferred tax assets of $165 million. The provision of the update addressing the presentation on the statement of cash flows of employee taxes paid via the withholding of shares was applied retrospectively and did not have a material impact on our Consolidated Financial Statements. Adoption of other provisions, which were applied prospectively, also did not have a material impact on our Consolidated Financial Statements. |
Restructuring and Other Charges
Restructuring and Other Charges, Net | 12 Months Ended |
Sep. 29, 2017 | |
Restructuring and Other Charges, Net | |
Restructuring and Other Charges, Net | 3. Restructuring and Other Charges, Net Net restructuring and other charges consisted of the following: Fiscal 2017 2016 2015 (in millions) Restructuring charges, net $ $ $ Gain on divestiture — ) — Other charges, net ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Restructuring Charges, Net Net restructuring charges by segment were as follows: Fiscal 2017 2016 2015 (in millions) Transportation Solutions $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Restructuring charges, net $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Activity in our restructuring reserves is summarized as follows: Balance at Charges Changes in Cash Non-Cash Currency Balance at (in millions) Fiscal 2017 Activity: Fiscal 2017 Actions: Employee severance $ — $ $ ) $ ) $ — $ $ Facility and other exit costs — — ) — — Property, plant, and equipment — — — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2016 Actions: Employee severance ) ) — — Facility and other exit costs — — ) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2015 Actions: Employee severance — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-Fiscal 2015 Actions: Employee severance — ) ) — ) Facility and other exit costs — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total fiscal 2017 activity $ $ $ ) $ ) $ ) $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2016 Activity: Fiscal 2016 Actions: Employee severance $ — $ $ — $ ) $ — $ — $ Facility and other exit costs — — ) — — — Property, plant, and equipment — — — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total — — ) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2015 Actions: Employee severance ) ) — — Facility and other exit costs — — ) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-Fiscal 2015 Actions: Employee severance — ) ) — Facility and other exit costs — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total fiscal 2016 activity $ $ $ ) $ ) $ ) $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at Charges Changes in Cash Non-Cash Currency Balance at (in millions) Fiscal 2015 Activity: Fiscal 2015 Actions: Employee severance $ — $ $ — $ ) $ — $ — $ Facility and other exit costs — — ) — — Property, plant, and equipment — — — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total — — ) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-Fiscal 2015 Actions: Employee severance ) ) — ) Facility and other exit costs — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total fiscal 2015 activity $ $ $ ) $ ) $ ) $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2017 Actions During fiscal 2017, we initiated a restructuring program associated with footprint consolidation related to recent acquisitions and structural improvements impacting all segments. In connection with this program, during fiscal 2017, we recorded net restructuring charges of $149 million. We expect to complete all restructuring actions commenced during fiscal 2017 by the end of fiscal 2019 and to incur total charges of approximately $160 million with remaining charges primarily related to employee severance. The following table summarizes expected, incurred, and remaining charges for the fiscal 2017 program by segment: Total Cumulative Remaining (in millions) Transportation Solutions $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2016 Actions During fiscal 2016, we initiated a restructuring program associated with headcount reductions impacting all segments and product line closures in the Communications Solutions segment. In connection with this program, during fiscal 2017 and 2016, we recorded net restructuring charges of $2 million and $130 million, respectively. We expect to complete all restructuring actions commenced during fiscal 2016 by the end of fiscal 2019 and to incur total charges of approximately $155 million with remaining charges related primarily to employee severance. The following table summarizes expected, incurred, and remaining charges for the fiscal 2016 program by segment: Total Cumulative Remaining (in millions) Transportation Solutions $ $ $ Industrial Solutions — Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2015 Actions During fiscal 2015, we initiated a restructuring program associated with headcount reductions and product line closures, primarily impacting the Communications Solutions and Industrial Solutions segments. In connection with this program, during fiscal 2017, 2016, and 2015, we recorded net restructuring credits of $2 million, credits of $1 million, and charges of $92 million, respectively. We do not expect to incur any additional charges related to restructuring programs commenced in fiscal 2015. Pre-Fiscal 2015 Actions During fiscal 2017, 2016, and 2015, we recorded net restructuring credits of $2 million, credits of $4 million, and charges of $1 million, respectively, related to pre-fiscal 2015 actions. We do not expect to incur any additional charges related to pre-fiscal 2015 actions. Total Restructuring Reserves Restructuring reserves included on the Consolidated Balance Sheets were as follows: Fiscal Year End 2017 2016 (in millions) Accrued and other current liabilities $ $ Other liabilities ​ ​ ​ ​ ​ ​ ​ ​ Restructuring reserves $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gain on Divestiture During fiscal 2016, we sold our Circuit Protection Devices ("CPD") business for net cash proceeds of $333 million. We recognized a pre-tax gain of $144 million on the transaction. The CPD business was reported in our Communications Solutions segment. Other Charges, Net During fiscal 2016, we incurred costs of $21 million, associated primarily with the divestiture of certain businesses. During fiscal 2015, we incurred costs of $59 million, consisting primarily of $36 million of legal and professional fees and $18 million of charges associated with the exit of a facility. These costs were incurred in connection with the sale of our Broadband Network Solutions ("BNS") business but were not directly related to the business sold and accordingly were recorded in continuing operations. See Note 4 for additional information regarding the divestiture of BNS. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Sep. 29, 2017 | |
Discontinued Operations | |
Discontinued Operations | 4. Discontinued Operations The following table presents certain components of income from discontinued operations, net of income taxes: Fiscal 2017 2016 2015 (in millions) Net sales from discontinued operations $ — $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-tax income from discontinued operations $ $ $ Pre-tax gain on sale of discontinued operations Income tax (expense) benefit ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from discontinued operations, net of income taxes $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ During fiscal 2015, we sold our BNS business for $3.0 billion in cash and recognized a pre-tax gain of $1.1 billion on the transaction. In the U.S., income taxes associated with the gain on the sale of assets were largely offset by income tax benefits realized on the sale of several subsidiaries. In certain non-U.S. jurisdictions, the sale was exempt from income taxes. During fiscal 2016, we recognized an additional pre-tax gain of $29 million on the divestiture, related primarily to pension and net working capital adjustments. In fiscal 2006, the former shareholders of Com-Net initiated a lawsuit related to our fiscal 2001 acquisition of Com-Net. In October 2015, the Court of Common Pleas in Allegheny County, Pennsylvania entered final judgment in favor of the sellers and against us for $127 million plus costs. Consequently, we recorded a reserve and pre-tax charges of $127 million during fiscal 2015. During fiscal 2016, we settled all matters in dispute and paid the sellers an aggregate amount of $96 million. In connection with the settlements, we recorded pre-tax credits of $30 million, representing a release of excess reserves, during fiscal 2016. These amounts were reflected in income from discontinued operations on the Consolidated Statements of Operations as the Com-Net case was associated with our former Wireless Systems business which was sold in fiscal 2009. The BNS and Wireless Systems businesses met the discontinued operations criteria and were reported as such in all periods presented on the Consolidated Financial Statements. Prior to reclassification to discontinued operations, the BNS and Wireless Systems businesses were included in the former Network Solutions and Wireless Systems segments, respectively. |
Acquisitions
Acquisitions | 12 Months Ended |
Sep. 29, 2017 | |
Acquisitions | |
Acquisitions | 5. Acquisitions Fiscal 2017 Acquisitions During fiscal 2017, we acquired two businesses for a combined cash purchase price of $250 million, net of cash acquired. The acquisitions were reported as part of our Transportation Solutions and Industrial Solutions segments from the date of acquisition. Fiscal 2016 Acquisitions In fiscal 2016, we acquired four businesses, including the Creganna Medical group, for a combined cash purchase price of $1.3 billion, net of cash acquired. The acquisitions were reported as part of our Industrial Solutions and Transportation Solutions segments from the date of acquisition. The following table summarizes the allocation of the purchase price to the fair value of identifiable assets acquired and liabilities assumed at the date of acquisition, in accordance with the acquisition method of accounting: (in millions) Cash and cash equivalents $ Other current assets Goodwill Intangible assets Other non-current assets ​ ​ ​ ​ ​ Total assets acquired ​ ​ ​ ​ ​ Current liabilities Deferred income taxes Other non-current liabilities ​ ​ ​ ​ ​ Total liabilities assumed ​ ​ ​ ​ ​ Net assets acquired Cash and cash equivalents acquired ) ​ ​ ​ ​ ​ Net cash paid $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The fair values assigned to intangible assets were determined using the income approach, specifically the relief from royalty and the multi-period excess earnings methods. Both valuation methods rely on management judgment, including expected future cash flows resulting from existing customer relationships, customer attrition rates, contributory effects of other assets utilized in the business, peer group cost of capital and royalty rates, and other factors. Useful lives for intangible assets were determined based upon the remaining useful economic lives of the intangible assets that are expected to contribute directly or indirectly to future cash flows. Acquired intangible assets consisted of the following: Amount Weighted-Average (in millions) (in years) Customer relationships $ Developed technology Trade names and trademarks Customer order backlog ​ ​ ​ ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The acquired intangible assets are being amortized on a straight-line basis over their expected useful lives. Goodwill of $802 million was recognized in these transactions, representing the excess of the purchase price over the fair value of the tangible and intangible assets acquired and liabilities assumed. This goodwill is attributable primarily to cost savings and other synergies related to operational efficiencies including the consolidation of manufacturing, marketing, and general and administrative functions. The goodwill has been allocated to the Industrial Solutions and Transportation Solutions segments and is not deductible for tax purposes. However, prior to being acquired by us, one of the fiscal 2016 acquisitions completed certain acquisitions that resulted in goodwill with an estimated value of $15 million that is deductible primarily for U.S. tax purposes, which we will deduct through 2025. Fiscal 2016 acquisitions contributed net sales of $167 million and operating income of $8 million to our Consolidated Statement of Operations during fiscal 2016. The operating income included $10 million of acquisition costs, $7 million associated with the amortization of acquisition-related fair value adjustments related to acquired inventories and customer order backlog, and $2 million of integration costs. Fiscal 2015 Acquisitions In October 2014, we acquired 100% of the outstanding shares of Measurement Specialties, Inc. ("Measurement Specialties"), a leading global designer and manufacturer of sensors and sensor-based systems, for $86.00 in cash per share. The total value paid was approximately $1.7 billion, net of cash acquired, and included $225 million for the repayment of Measurement Specialties' debt and accrued interest. Measurement Specialties offers a broad portfolio of technologies including pressure, vibration, force, temperature, humidity, ultrasonic, position, and fluid sensors, for a wide range of applications and industries. This business has been reported as part of our Transportation Solutions segment from the date of acquisition. The following table summarizes the allocation of the purchase price to the fair value of identifiable assets acquired and liabilities assumed at the date of acquisition, in accordance with the acquisition method of accounting: (in millions) Cash and cash equivalents $ Accounts receivable Inventories Other current assets Property, plant, and equipment Goodwill Intangible assets Other non-current assets ​ ​ ​ ​ ​ Total assets acquired ​ ​ ​ ​ ​ Short-term debt Accounts payable Other current liabilities Long-term debt Deferred income taxes Other non-current liabilities ​ ​ ​ ​ ​ Total liabilities assumed ​ ​ ​ ​ ​ Net assets acquired Cash and cash equivalents acquired ) ​ ​ ​ ​ ​ Net cash paid $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The fair values assigned to intangible assets were determined using the income approach, specifically the relief from royalty and the multi-period excess earnings methods. The valuation of tangible assets was derived using a combination of the income, market, and cost approaches. Useful lives for intangible assets were determined based upon the remaining useful economic lives of the intangible assets that are expected to contribute directly or indirectly to future cash flows. Acquired intangible assets consisted of the following: Amount Weighted-Average Amortization Period (in millions) (in years) Customer relationships $ Developed technology Trade names and trademarks Customer order backlog < 1 ​ ​ ​ ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The acquired intangible assets are being amortized on a straight-line basis over their expected useful lives. Goodwill of $1,064 million was recognized in the transaction, representing the excess of the purchase price over the fair value of the tangible and intangible assets acquired and liabilities assumed. This goodwill is attributable primarily to cost savings and other synergies related to operational efficiencies including the consolidation of manufacturing, marketing, and general and administrative functions. The goodwill has been allocated to the Transportation Solutions segment and is not deductible for tax purposes. However, prior to its merger with us, Measurement Specialties completed certain acquisitions that resulted in goodwill with an estimated value of $23 million that is deductible primarily for U.S. tax purposes, which we will deduct through 2030. During fiscal 2015, Measurement Specialties contributed net sales of $548 million to our Consolidated Statement of Operations. Due to the commingled nature of our operations, it is not practicable to separately identify operating income of Measurement Specialties on a stand-alone basis. During fiscal 2015, we acquired three additional businesses for $241 million in cash, net of cash acquired. Pro Forma Financial Information The following unaudited pro forma financial information reflects our consolidated results of operations had the fiscal 2016 acquisitions occurred at the beginning of fiscal 2015 and the Measurement Specialties acquisition occurred at the beginning of fiscal 2014: Pro Forma for Fiscal 2016 2015 (in millions, except Net sales $ $ Net income Diluted earnings per share $ $ The pro forma adjustments, which were not significant, included interest expense based on pro forma changes in our combined capital structure, charges related to acquired customer order backlog, charges related to the amortization of the fair value of acquired intangible assets, charges related to the fair value adjustment to acquisition-date inventories, and acquisition and other costs, and the related tax effects. Pro forma results do not include any anticipated synergies or other anticipated benefits of these acquisitions. Accordingly, the unaudited pro forma financial information is not necessarily indicative of either future results of operations or results that might have been achieved had these acquisitions occurred at the beginning of the preceding fiscal years. |
Inventories
Inventories | 12 Months Ended |
Sep. 29, 2017 | |
Inventories | |
Inventories | 6. Inventories Inventories consisted of the following: Fiscal Year End 2017 2016 (in millions) Raw materials $ $ Work in progress Finished goods Inventoried costs on long-term contracts ​ ​ ​ ​ ​ ​ ​ ​ Inventories $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Property, Plant, and Equipment,
Property, Plant, and Equipment, Net | 12 Months Ended |
Sep. 29, 2017 | |
Property, Plant, and Equipment, Net | |
Property, Plant, and Equipment, Net | 7. Property, Plant, and Equipment, Net Net property, plant, and equipment consisted of the following: Fiscal Year End 2017 2016 (in millions) Land and improvements $ $ Buildings and improvements Machinery and equipment Construction in process ​ ​ ​ ​ ​ ​ ​ ​ Gross property, plant, and equipment Accumulated depreciation ) ) ​ ​ ​ ​ ​ ​ ​ ​ Property, plant, and equipment, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation expense was $466 million, $436 million, and $463 million in fiscal 2017, 2016, and 2015, respectively. |
Goodwill
Goodwill | 12 Months Ended |
Sep. 29, 2017 | |
Goodwill | |
Goodwill | 8. Goodwill The changes in the carrying amount of goodwill by segment were as follows: Transportation Industrial Communications Total (in millions) Fiscal year end 2015 (1) $ $ $ $ Acquisitions — Divestiture of business — — ) ) Currency translation ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year end 2016 (1) Acquisitions — Currency translation ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year end 2017 (1) $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) At fiscal year end 2017, 2016, and 2015, accumulated impairment losses for the Transportation Solutions and Industrial Solutions segments were $2,191 million and $669 million, respectively. Accumulated impairment losses for the Communications Solutions segment were $1,514 million at fiscal year end 2017 and 2016 and $1,626 million at fiscal year end 2015. During fiscal 2017, we acquired two businesses and recognized goodwill of $130 million, which benefitted the Transportation Solutions and Industrial Solutions segments. During fiscal 2016, we acquired four businesses and recognized goodwill of $836 million, which benefited the Industrial Solutions and Transportation Solutions segments. In fiscal 2017, we finalized the purchase price allocation of our fiscal 2016 acquisitions, and the associated goodwill was reduced to $802 million. This reduction, which was primarily within the Industrial Solutions segment, is reflected in fiscal 2017 acquisitions in the above table. See Note 5 for additional information regarding acquisitions. During fiscal 2016, net goodwill of $117 million was written-off in connection with the sale of our CPD business. See Note 3 for additional information regarding the divestiture of CPD. We completed our annual goodwill impairment test in the fourth quarter of fiscal 2017 and determined that no impairment existed. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Sep. 29, 2017 | |
Intangible Assets, Net | |
Intangible Assets, Net | 9. Intangible Assets, Net Intangible assets consisted of the following: Fiscal Year End 2017 2016 Gross Accumulated Net Gross Accumulated Net (in millions) Customer relationships $ $ ) $ $ $ ) $ Intellectual property ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Intangible asset amortization expense was $169 million, $149 million, and $153 million for fiscal 2017, 2016, and 2015, respectively. The aggregate amortization expense on intangible assets is expected to be as follows: (in millions) Fiscal 2018 $ Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Accrued and Other Current Liabi
Accrued and Other Current Liabilities | 12 Months Ended |
Sep. 29, 2017 | |
Accrued and Other Current Liabilities | |
Accrued and Other Current Liabilities | 10. Accrued and Other Current Liabilities Accrued and other current liabilities consisted of the following: Fiscal Year End 2017 2016 (in millions) Accrued payroll and employee benefits $ $ Dividends payable to shareholders Income taxes payable Restructuring reserves Interest payable Other ​ ​ ​ ​ ​ ​ ​ ​ Accrued and other current liabilities $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Debt
Debt | 12 Months Ended |
Sep. 29, 2017 | |
Debt | |
Debt | 11. Debt Debt was as follows: Fiscal Year End 2017 2016 (in millions) Commercial paper, at a weighted-average interest rate of 0.69% at fiscal year end 2016 $ — $ 6.55% senior notes due 2017 2.375% senior notes due 2018 2.35% senior notes due 2019 4.875% senior notes due 2021 3.50% senior notes due 2022 1.10% euro-denominated senior notes due 2023 3.45% senior notes due 2024 3.70% senior notes due 2026 3.125% senior notes due 2027 — 7.125% senior notes due 2037 Other ​ ​ ​ ​ ​ ​ ​ ​ Total principal debt Unamortized discounts and debt issuance costs ) ) Effects of fair value hedge-designated interest rate swaps ​ ​ ​ ​ ​ ​ ​ ​ Total debt $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ During August 2017, Tyco Electronics Group S.A. ("TEGSA"), our 100%-owned subsidiary, issued $400 million aggregate principal amount of 3.125% senior notes due August 2027 and $100 million aggregate principal amount of 3.45% senior notes due August 2024. The 3.45% senior notes were issued under an existing indenture under which TEGSA had previously issued $250 million aggregate principal amount. The notes are TEGSA's unsecured senior obligations and rank equally in right of payment with all existing and any future senior indebtedness of TEGSA and senior to any subordinated indebtedness that TEGSA may incur. TEGSA has a five-year unsecured senior revolving credit facility ("Credit Facility") with a maturity date of December 2020 and total commitments of $1,500 million. TEGSA had no borrowings under the Credit Facility at fiscal year end 2017 or 2016. Borrowings under the Credit Facility bear interest at a rate per annum equal to, at the option of TEGSA, (1) LIBOR plus an applicable margin based upon the senior, unsecured, long-term debt rating of TEGSA, or (2) an alternate base rate equal to the highest of (i) Bank of America, N.A.'s base rate, (ii) the federal funds effective rate plus 1 / 2 of 1%, and (iii) one-month LIBOR plus 1%, plus, in each case, an applicable margin based upon the senior, unsecured, long-term debt rating of TEGSA. TEGSA is required to pay an annual facility fee ranging from 5.0 to 12.5 basis points based upon the amount of the lenders' commitments under the Credit Facility and the applicable credit ratings of TEGSA. The Credit Facility contains a financial ratio covenant providing that if, as of the last day of each fiscal quarter, our ratio of Consolidated Total Debt to Consolidated EBITDA (as defined in the Credit Facility) for the then most recently concluded period of four consecutive fiscal quarters exceeds 3.75 to 1.0, an Event of Default (as defined in the Credit Facility) is triggered. The Credit Facility and our other debt agreements contain other customary covenants. Periodically, TEGSA issues commercial paper to U.S. institutional accredited investors and qualified institutional buyers in accordance with available exemptions from the registration requirements of the Securities Act of 1933 as part of our ongoing effort to maintain financial flexibility and to potentially decrease the cost of borrowings. Borrowings under the commercial paper program are backed by the Credit Facility. TEGSA's payment obligations under its senior notes, commercial paper, and Credit Facility are fully and unconditionally guaranteed by its parent, TE Connectivity Ltd. Principal payments required for debt are as follows: (in millions) Fiscal 2018 $ Fiscal 2019 Fiscal 2020 — Fiscal 2021 Fiscal 2022 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The fair value of our debt, based on indicative valuations, was approximately $4,622 million and $4,424 million at fiscal year end 2017 and 2016, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Sep. 29, 2017 | |
Commitments and Contingencies | |
Commitments and Contingencies | 12. Commitments and Contingencies Legal Proceedings In the normal course of business, we are subject to various legal proceedings and claims, including patent infringement claims, product liability matters, employment disputes, disputes on agreements, other commercial disputes, environmental matters, antitrust claims, and tax matters, including non-income tax matters such as value added tax, sales and use tax, real estate tax, and transfer tax. Although it is not feasible to predict the outcome of these proceedings, based upon our experience, current information, and applicable law, we do not expect that the outcome of these proceedings, either individually or in the aggregate, will have a material effect on our results of operations, financial position, or cash flows. Environmental Matters We are involved in various stages of investigation and cleanup related to environmental remediation matters at a number of sites. The ultimate cost of site cleanup is difficult to predict given the uncertainties regarding the extent of the required cleanup, the interpretation of applicable laws and regulations, and alternative cleanup methods. As of fiscal year end 2017, we concluded that it was probable that we would incur investigation and remediation costs at these sites in the range of $15 million to $43 million, and that the best estimate within this range was $19 million. We believe that any potential payment of such estimated amounts will not have a material adverse effect on our results of operations, financial position, or cash flows. Leases We have facility, land, vehicle, and equipment leases that expire at various dates. Rental expense under these operating leases was $153 million, $143 million, and $141 million for fiscal 2017, 2016, and 2015, respectively. At fiscal year end 2017, future minimum lease payments under non-cancelable operating lease obligations were as follows: (in millions) Fiscal 2018 $ Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Guarantees In disposing of assets or businesses, we often provide representations, warranties, and/or indemnities to cover various risks including unknown damage to assets, environmental risks involved in the sale of real estate, liability for investigation and remediation of environmental contamination at waste disposal sites and manufacturing facilities, and unidentified tax liabilities and legal fees related to periods prior to disposition. We do not expect that these uncertainties will have a material adverse effect on our results of operations, financial position, or cash flows. At fiscal year end 2017, we had outstanding letters of credit, letters of guarantee, and surety bonds of $298 million. We generally record estimated product warranty costs when contract revenues are recognized under the percentage-of-completion method for construction related contracts; other warranty reserves are not significant. The estimation is based primarily on historical experience and actual warranty claims. Amounts accrued for warranty claims were $50 million and $48 million at fiscal year end 2017 and 2016, respectively. Tax Sharing Agreement In fiscal 2007, we became an independent, publicly traded company owning the former electronics businesses of Tyco International plc ("Tyco International"). On June 29, 2007, Tyco International distributed all of our shares, as well as its shares of its former healthcare businesses ("Covidien"), to its common shareholders (the "separation"). As a result of subsequent transactions, Tyco International and Covidien now operate as part of Johnson Controls International plc and Medtronic plc, respectively. Upon separation, we entered into a Tax Sharing Agreement, under which we share responsibility for certain of our, Tyco International's, and Covidien's income tax liabilities based on a sharing formula for periods prior to and including June 29, 2007. We, Tyco International, and Covidien share 31%, 27%, and 42%, respectively, of income tax liabilities that arise from adjustments made by tax authorities to our, Tyco International's, and Covidien's income tax returns. Pursuant to the Tax Sharing Agreement, we entered into certain guarantee commitments and indemnifications with Tyco International and Covidien. We have substantially settled all U.S. federal income tax matters with the Internal Revenue Service ("IRS") for periods covered under the Tax Sharing Agreement. Certain shared U.S. state and non-U.S. income tax matters remain open. We do not expect these matters will have a material effect on our results of operations, financial position, or cash flows. |
Financial Instruments and Fair
Financial Instruments and Fair Value Measurements | 12 Months Ended |
Sep. 29, 2017 | |
Financial Instruments and Fair Value Measurements | |
Financial Instruments and Fair Value Measurements | 13. Financial Instruments and Fair Value Measurements We use derivative and non-derivative financial instruments to manage certain exposures to foreign currency, interest rate, investment, and commodity risks. The effects of derivative instruments on the Consolidated Statements of Operations were immaterial for fiscal 2017, 2016, and 2015. Foreign Exchange Risks and Hedges of Net Investment As part of managing the exposure to changes in foreign currency exchange rates, we utilize cross-currency swap contracts, foreign currency forward contracts, and foreign currency swap contracts, a portion of which are designated as cash flow hedges. The objective of these contracts is to minimize impacts to cash flows and profitability due to changes in foreign currency exchange rates on intercompany and other cash transactions. We expect that significantly all of the balance in accumulated other comprehensive income (loss) associated with the cash flow hedge-designated instruments addressing foreign exchange risks will be reclassified into the Consolidated Statement of Operations within the next twelve months. During fiscal 2015, we entered into cross-currency swap contracts with an aggregate notional value of €1,000 million to reduce our exposure to foreign currency exchange risk associated with certain intercompany loans. Under the terms of these contracts, which have been designated as cash flow hedges, we make quarterly interest payments in euros at 3.50% per annum and receive interest in U.S. dollars at a weighted-average rate of 5.33% per annum. Upon the maturities of these contracts in fiscal 2022, we will pay the principal amount of the loans in euros and receive U.S. dollars from our counterparties. We hedge our net investment in certain foreign operations using intercompany non-derivative financial instruments denominated in the same currencies. The aggregate notional value of these hedges was $3,110 million and $3,480 million at fiscal year end 2017 and 2016, respectively. The impacts of our hedging program were as follows: Fiscal 2017 2016 2015 (in millions) Foreign exchange gains (losses) $ ) $ ) $ These foreign exchange gains and losses were recorded as currency translation, a component of accumulated other comprehensive income (loss), offsetting foreign exchange losses and gains attributable to the translation of the net investment. See Note 19 for additional information. Interest Rate and Investment Risk Management We issue debt, as needed, to fund our operations and capital requirements. Such borrowings can result in interest rate exposure. To manage the interest rate exposure, we use interest rate swaps to convert a portion of fixed-rate debt into variable-rate debt. We use forward starting interest rate swaps and options to enter into interest rate swaps to manage interest rate exposure in periods prior to the anticipated issuance of fixed-rate debt. We also utilize investment swaps to manage earnings exposure on certain nonqualified deferred compensation liabilities. Commodity Hedges As part of managing the exposure to certain commodity price fluctuations, we utilize commodity swap contracts designated as cash flow hedges. The objective of these contracts is to minimize impacts to cash flows and profitability due to changes in prices of commodities used in production. At fiscal year end 2017 and 2016, our commodity hedges had notional values of $314 million and $232 million, respectively. We expect that significantly all of the balance in accumulated other comprehensive income (loss) associated with the commodity hedges will be reclassified into the Consolidated Statement of Operations within the next twelve months. Fair Value Measurements Financial instruments recorded at fair value on a recurring basis, which consist of derivative instruments and marketable securities, were immaterial at fiscal year end 2017 and 2016. |
Retirement Plans
Retirement Plans | 12 Months Ended |
Sep. 29, 2017 | |
Retirement Plans | |
Retirement Plans | 14. Retirement Plans Defined Benefit Pension Plans We have a number of contributory and noncontributory defined benefit retirement plans covering certain of our U.S. and non-U.S. employees, designed in accordance with local customs and practice. The net periodic pension benefit cost for all U.S. and non-U.S. defined benefit pension plans was as follows: U.S. Plans Non-U.S. Plans Fiscal Fiscal 2017 2016 2015 2017 2016 2015 ($ in millions) Service cost $ $ $ $ $ $ Interest cost Expected return on plan assets ) ) ) ) ) ) Amortization of net actuarial loss Other — — — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net periodic pension benefit cost $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average assumptions used to determine net pension benefit cost during the fiscal year: Discount rate % % % % % % Expected return on plan assets % % % % % % Rate of compensation increase — % — % — % % % % The following table represents the changes in benefit obligation and plan assets and the net amount recognized on the Consolidated Balance Sheets for all U.S. and non-U.S. defined benefit pension plans: U.S. Plans Non-U.S. Plans Fiscal Fiscal 2017 2016 2017 2016 ($ in millions) Change in benefit obligation: Benefit obligation at beginning of fiscal year $ $ $ $ Service cost Interest cost Actuarial loss ) ) Benefits and administrative expenses paid ) ) ) ) Currency translation — — ) Other — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Benefit obligation at end of fiscal year ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change in plan assets: Fair value of plan assets at beginning of fiscal year Actual return on plan assets Employer contributions Benefits and administrative expenses paid ) ) ) ) Currency translation — — ) ) Other — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value of plan assets at end of fiscal year ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Funded status $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amounts recognized on the Consolidated Balance Sheets: Other assets $ — $ — $ $ — Accrued and other current liabilities ) ) ) ) Long-term pension and postretirement liabilities ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net amount recognized $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average assumptions used to determine pension benefit obligation at fiscal year end: Discount rate % % % % Rate of compensation increase — % — % % % The pre-tax amounts recognized in accumulated other comprehensive income (loss) for all U.S. and non-U.S. defined benefit pension plans were as follows: U.S. Plans Non-U.S. Plans Fiscal Fiscal 2017 2016 2017 2016 (in millions) Change in net loss: Unrecognized net loss at beginning of fiscal year $ $ $ $ Current year change recorded in accumulated other comprehensive income (loss) ) ) Amortization reclassified to earnings ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrecognized net loss at end of fiscal year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change in prior service credit: Unrecognized prior service credit at beginning of fiscal year $ — $ — $ ) $ ) Current year change recorded in accumulated other comprehensive income (loss) — ) Amortization reclassified to earnings (1) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrecognized prior service credit at end of fiscal year $ $ — $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Amortization of prior service credit is included in other in the above table summarizing the components of net periodic pension benefit cost. In fiscal 2017, unrecognized actuarial gains recorded in accumulated other comprehensive income (loss) were primarily the result of higher discount rates and favorable asset performance for both U.S. and non-U.S. defined benefit pension plans as compared to fiscal 2016. In fiscal 2016, unrecognized actuarial losses recorded in accumulated other comprehensive income (loss) were primarily the result of lower discount rates partially offset by favorable asset performance for both U.S. and non-U.S. defined benefit pension plans as compared to fiscal 2015. The estimated amortization of actuarial losses from accumulated other comprehensive income (loss) into net periodic pension benefit cost for U.S. and non-U.S. defined benefit pension plans in fiscal 2018 is expected to be $22 million and $24 million, respectively. The estimated amortization of prior service credit from accumulated other comprehensive income (loss) into net periodic pension benefit cost for non-U.S. defined benefit pension plans in fiscal 2018 is expected to be $6 million. In determining the expected return on plan assets, we consider the relative weighting of plan assets by class and individual asset class performance expectations. The investment strategies for U.S. and non-U.S. pension plans are governed locally. Our investment strategy for our pension plans is to manage the plans on a going concern basis. Current investment policy is to achieve a reasonable return on assets, subject to a prudent level of portfolio risk, for the purpose of enhancing the security of benefits for participants. Projected returns are based primarily on pro forma asset allocation, expected long-term returns, and forward-looking estimates of active portfolio and investment management. The long-term target asset allocation in our U.S. plans' master trust is 10% equity and 90% fixed income. Asset re-allocation to meet that target is occurring over a multi-year period based on the funded status. We expect to reach our target allocation when the funded status of the plans exceeds 105%. Based on the funded status of the plans as of fiscal year end 2017, our target asset allocation is 45% equity and 55% fixed income. Target weighted-average asset allocation and weighted-average asset allocation for U.S. and non-U.S. pension plans were as follows: U.S. Plans Non-U.S. Plans Target Fiscal Fiscal Target Fiscal Fiscal Asset category: Equity securities % % % % % % Fixed income Insurance contracts and other investments — — — Real estate investments — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total % % % % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Our common shares are not a direct investment of our pension funds; however, the pension funds may indirectly include our shares. The aggregate amount of our common shares would not be considered material relative to the total pension fund assets. Our funding policy is to make contributions in accordance with the laws and customs of the various countries in which we operate as well as to make discretionary voluntary contributions from time to time. We expect to make the minimum required contributions of $6 million and $56 million to our U.S. and non-U.S. pension plans, respectively, in fiscal 2018. We may also make voluntary contributions at our discretion. Benefit payments, which reflect future expected service, as appropriate, are expected to be paid as follows: U.S. Plans Non-U.S. Plans (in millions) Fiscal 2018 $ $ Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2023-2027 Presented below is the accumulated benefit obligation for all U.S. and non-U.S. pension plans as well as additional information related to plans with an accumulated benefit obligation in excess of plan assets and plans with a projected benefit obligation in excess of plan assets. U.S. Plans Non-U.S. Plans Fiscal Year End Fiscal Year End 2017 2016 2017 2016 (in millions) Accumulated benefit obligation $ $ $ $ Pension plans with accumulated benefit obligations in excess of plan assets: Accumulated benefit obligation Fair value of plan assets Pension plans with projected benefit obligations in excess of plan assets: Projected benefit obligation Fair value of plan assets We value our pension assets based on the fair value hierarchy of ASC 820, Fair Value Measurements and Disclosures . Details of the fair value hierarchy are described in Note 2. The following table presents our defined benefit pension plans' asset categories and their associated fair value within the fair value hierarchy: Fiscal Year End 2017 U.S. Plans Non-U.S. Plans Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (in millions) Equity: U.S. equity securities (1) $ $ — $ — $ $ — $ — $ — $ — Non-U.S. equity securities (1) — — — — — — Commingled equity funds (2) — — — — — — Fixed income: Government bonds (3) — — — — Corporate bonds (4) — — — — Commingled bond funds (5) — — — — Other (6) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Subtotal $ $ $ — $ — $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Items to reconcile to fair value of plan assets (7) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value of plan assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year End 2016 U.S. Plans Non-U.S. Plans Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (in millions) Equity: U.S. equity securities (1) $ $ — $ — $ $ $ — $ — $ Non-U.S. equity securities (1) — — — — Commingled equity funds (2) — — — — — — Fixed income: Government bonds (3) — — — — Corporate bonds (4) — — — — Commingled bond funds (5) — — — — — — Other (6) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Subtotal $ $ $ — $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Items to reconcile to fair value of plan assets (7) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value of plan assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) U.S. and non-U.S. equity securities are valued at the closing price reported on the stock exchange on which the individual securities are traded. (2) Commingled equity funds are pooled investments in multiple equity-type securities. Fair value is calculated as the closing price of the underlying investments, an observable market condition, divided by the number of shares of the fund outstanding. (3) Government bonds are marked to fair value based on quoted market prices or market approach valuation models using observable market data such as quotes, spreads, and data points for yield curves. (4) Corporate bonds are marked to fair value based on quoted market prices or market approach valuation models using observable market data such as quotes, spreads, and data points for yield curves. (5) Commingled bond funds are pooled investments in multiple debt-type securities. Fair value is calculated as the closing price of the underlying investments, an observable market condition, divided by the number of shares of the fund outstanding. (6) Other investments are composed of insurance contracts, derivatives, short-term investments, structured products such as collateralized obligations and mortgage- and asset-backed securities, real estate investments, and hedge funds. Insurance contracts are valued using cash surrender value, or face value of the contract if a cash surrender value is unavailable (level 2), as these values represent the amount that the plan would receive on termination of the underlying contract. Derivatives, short-term investments, and structured products are marked to fair value using models that are supported by observable market based data (level 2). Real estate investments include investments in commingled real estate funds and are valued at net asset value which is calculated using unobservable inputs that are supported by little or no market activity (level 3). Hedge funds are valued at their net asset value which is calculated using unobservable inputs that are supported by little or no market activity (level 3). (7) Items to reconcile to fair value of plan assets include amounts receivable for securities sold, amounts payable for securities purchased, and any cash balances, considered to be carried at book value, that are held in the plans. Changes in Level 3 assets in non-U.S. plans were primarily the result of purchases in fiscal 2017 and 2016. Defined Contribution Retirement Plans We maintain several defined contribution retirement plans, the most significant of which is located in the U.S. These plans include 401(k) matching programs, as well as qualified and nonqualified profit sharing and share bonus retirement plans. Expense for the defined contribution plans is computed as a percentage of participants' compensation and was $68 million, $59 million, and $60 million for fiscal 2017, 2016, and 2015, respectively. Deferred Compensation Plans We maintain nonqualified deferred compensation plans, which permit eligible employees to defer a portion of their compensation. A record keeping account is set up for each participant and the participant chooses from a variety of measurement funds for the deemed investment of their accounts. The measurement funds correspond to a number of funds in our 401(k) plans and the account balance fluctuates with the investment returns on those funds. Total deferred compensation liabilities were $157 million and $132 million at fiscal year end 2017 and 2016, respectively. See Note 13 for additional information regarding our risk management strategy related to deferred compensation liabilities. Postretirement Benefit Plans In addition to providing pension and 401(k) benefits, we also provide certain health care coverage continuation for qualifying retirees from the date of retirement to age 65. The accumulated postretirement benefit obligation was $20 million and $45 million at fiscal year end 2017 and 2016, respectively, and the underfunded status of the postretirement benefit plans was included primarily in long-term pension and postretirement liabilities on the Consolidated Balance Sheets. The decrease in the accumulated postretirement benefit obligation during fiscal 2017 was primarily attributable to a plan curtailment that was recognized on the Consolidated Statement of Operations; activity during fiscal 2016 and 2015 was not significant. |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 29, 2017 | |
Income Taxes | |
Income Taxes | 15. Income Taxes Income Tax Expense (Benefit) Significant components of the income tax expense (benefit) were as follows: Fiscal 2017 2016 2015 (in millions) Current income tax expense (benefit): U.S.: Federal $ ) $ ) $ ) State ) Non-U.S. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred income tax expense (benefit): U.S.: Federal ) State ) Non-U.S. ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax expense (benefit) $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The U.S. and non-U.S. components of income from continuing operations before income taxes were as follows: Fiscal 2017 2016 2015 (in millions) U.S. $ ) $ ) $ ) Non-U.S. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The reconciliation between U.S. federal income taxes at the statutory rate and income tax expense (benefit) was as follows: Fiscal 2017 2016 2015 (in millions) Notional U.S. federal income tax expense at the statutory rate $ $ $ Adjustments to reconcile to the income tax expense (benefit): U.S. state income tax expense (benefit), net — ) Other expense—Tax Sharing Agreement (1) Tax law changes ) Tax credits ) ) ) Non-U.S. net earnings (2) ) ) ) Change in accrued income tax liabilities ) ) Valuation allowance ) ) Legal entity restructuring and intercompany transactions ) Divestitures — ) — Excess tax benefits from share-based payments ) — — Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax expense (benefit) $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Net other expense pursuant to the Tax Sharing Agreement with Tyco International and Covidien is not taxable or deductible. (2) Excludes items which are separately presented. The income tax expense for fiscal 2017 included a $52 million income tax benefit associated with the tax impacts of certain intercompany transactions and the corresponding reduction in the valuation allowance for U.S. tax loss carryforwards, a $40 million income tax benefit related to share-based payments and the adoption of ASU No. 2016-09, and a $14 million income tax benefit associated with pre-separation tax matters. See Note 2 for additional information regarding recently adopted accounting pronouncements. The income tax benefit for fiscal 2016 included a $1,135 million income tax benefit related to the effective settlement of tax matters for the years 1997 through 2000 which resolved all aspects of the disputed debt matter with the IRS through the year 2007, partially offset by a $91 million income tax charge related to an increase to the valuation allowance for certain U.S. deferred tax assets. Additionally, the tax benefit for fiscal 2016 included an $83 million net income tax benefit related to tax settlements in certain other tax jurisdictions, partially offset by an income tax charge related to certain legal entity restructurings. In fiscal 2016, the increase to the valuation allowance for deferred tax assets primarily related to certain U.S. federal and state tax loss and credit carryforwards. Based on our forecast of taxable income for certain U.S. tax reporting groups, U.S. tax loss and credit carryforwards finalized as a result of settlement of the disputed debt matter with the IRS, and certain tax planning actions and strategies, we believed it was more likely than not that a portion of our deferred tax assets would not be realized. The income tax expense for fiscal 2015 included a $264 million income tax benefit related to the effective settlement of all undisputed tax matters for the years 2001 through 2010, partially offset by a $216 million income tax charge associated with the tax impacts of certain intercompany legal entity restructurings made in connection with our integration of Measurement Specialties. Also, income tax expense for fiscal 2015 included an income tax charge of $29 million associated with the tax impacts of certain intercompany dividends related to the restructuring and sale of our BNS business. See "IRS Audits" below for additional information regarding settlements with the IRS. Deferred Tax Assets and Liabilities Deferred income taxes result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The components of the net deferred income tax asset were as follows: Fiscal Year End 2017 2016 (in millions) Deferred tax assets: Accrued liabilities and reserves $ $ Tax loss and credit carryforwards Inventories Pension and postretirement benefits Deferred revenue Interest Unrecognized income tax benefits Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred tax liabilities: Intangible assets ) ) Property, plant, and equipment ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ ) ) ​ ​ ​ ​ ​ ​ ​ ​ Net deferred tax asset before valuation allowance Valuation allowance ) ) ​ ​ ​ ​ ​ ​ ​ ​ Net deferred tax asset $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Our tax loss and credit carryforwards (tax effected) at fiscal year end 2017 were as follows: Expiration Period Through Fiscal 2023 No Total (in millions) U.S. Federal: Net operating loss carryforwards $ $ $ — $ Tax credit carryforwards Capital loss carryforwards — — U.S. State: Net operating loss carryforwards. — Tax credit carryforwards Non-U.S.: Net operating loss carryforwards Tax credit carryforwards — Capital loss carryforwards — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total tax loss and credit carryforwards $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The valuation allowance for deferred tax assets of $3,627 million and $3,096 million at fiscal year end 2017 and 2016, respectively, related principally to the uncertainty of the utilization of certain deferred tax assets, primarily tax loss, capital loss, and credit carryforwards in various jurisdictions. During fiscal 2017, tax loss and credit carryforwards increased due primarily to tax losses of $709 million (tax effected) generated in connection with the net write-down of investments in subsidiaries in certain jurisdictions, offset by the impacts of a statutory rate reduction in the same jurisdictions. The valuation allowance was increased by a corresponding amount due to the uncertainty of future realization of these tax losses. Additionally, the valuation allowance decreased by $165 million in connection with the adoption of ASU No. 2016-09 related to share-based payments. See Note 2 for additional information regarding recently adopted accounting pronouncements. We believe that we will generate sufficient future taxable income to realize the income tax benefits related to the remaining net deferred tax assets on the Consolidated Balance Sheet. We have provided income taxes for earnings that are currently distributed as well as the taxes associated with several subsidiaries' earnings that are expected to be distributed in the future. No additional provision has been made for Swiss or non-Swiss income taxes on the undistributed earnings of subsidiaries or for unrecognized deferred tax liabilities for temporary differences related to basis differences in investments in subsidiaries, as such earnings are expected to be permanently reinvested, the investments are essentially permanent in duration, or we have concluded that no additional tax liability will arise as a result of the distribution of such earnings. As of fiscal year end 2017, certain subsidiaries had approximately $22 billion of cumulative undistributed earnings that have been retained indefinitely and reinvested in our global manufacturing operations, including working capital; property, plant, and equipment; intangible assets; and research and development activities. A liability could arise if our intention to permanently reinvest such earnings were to change and amounts are distributed by such subsidiaries or if such subsidiaries are ultimately disposed. It is not practicable to estimate the additional income taxes related to permanently reinvested earnings or the basis differences related to investments in subsidiaries. As of fiscal year end 2017, we had approximately $6.3 billion of cash, cash equivalents, and intercompany deposits, principally in our subsidiaries, that we have the ability to distribute to TEGSA, our Luxembourg subsidiary, which is the obligor of substantially all of our debt, and to TE Connectivity Ltd., our Swiss parent company, but we consider to be permanently reinvested. We estimate that approximately $1.2 billion of tax expense would be recognized on the Consolidated Financial Statements if our intention to permanently reinvest these amounts were to change. Our current plans do not demonstrate a need to repatriate cash, cash equivalents, and intercompany deposits that are designated as permanently reinvested in order to fund our operations, including investing and financing activities. Uncertain Tax Positions As of fiscal year end 2017, we had total unrecognized income tax benefits of $501 million. If recognized in future years, $431 million of these currently unrecognized income tax benefits would impact income tax expense (benefit) and the effective tax rate. As of fiscal year end 2016, we had total unrecognized income tax benefits of $490 million. If recognized in future years, $370 million of these currently unrecognized income tax benefits would impact income tax expense (benefit) and the effective tax rate. The following table summarizes the activity related to unrecognized income tax benefits: Fiscal 2017 2016 2015 (in millions) Balance at beginning of fiscal year $ $ $ Additions related to prior years tax positions Reductions related to prior years tax positions ) ) ) Additions related to current year tax positions Acquisitions — — Settlements ) ) ) Reductions due to lapse of applicable statute of limitations ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at end of fiscal year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ We record accrued interest and penalties related to uncertain tax positions as part of income tax expense (benefit). As of fiscal year end 2017 and 2016, we had $60 million and $54 million, respectively, of accrued interest and penalties related to uncertain tax positions on the Consolidated Balance Sheets, recorded primarily in income taxes. During fiscal 2017, 2016, and 2015, we recognized income tax benefits of $5 million, benefits of $765 million, and expense of $7 million, respectively, related to interest and penalties on the Consolidated Statements of Operations. We file income tax returns on a unitary, consolidated, or stand-alone basis in multiple state and local jurisdictions, which generally have statutes of limitations ranging from 3 to 4 years. Various state and local income tax returns are currently in the process of examination or administrative appeal. Our non-U.S. subsidiaries file income tax returns in the countries in which they have operations. Generally, these countries have statutes of limitations ranging from 3 to 10 years. Various non-U.S. subsidiary income tax returns are currently in the process of examination by taxing authorities. As of fiscal year end 2017, under applicable statutes, the following tax years remained subject to examination in the major tax jurisdictions indicated: Jurisdiction Open Years China 2007 through 2017 Czech Republic 2014 through 2017 Germany 2013 through 2017 Hong Kong 2011 through 2017 Ireland 2012 through 2017 Italy 2013 through 2017 Japan 2011 through 2017 Korea 2012 through 2017 Luxembourg 2012 through 2017 Netherlands 2012 through 2017 Singapore 2012 through 2017 Spain 2013 through 2017 Switzerland 2012 through 2017 United Kingdom 2015 through 2017 U.S.—federal 2014 through 2017 In most jurisdictions, taxing authorities retain the ability to review prior tax years and to adjust any net operating loss and tax credit carryforwards from these years that are utilized in a subsequent period. Although it is difficult to predict the timing or results of our worldwide examinations, we estimate that approximately $40 million of unrecognized income tax benefits, excluding the impact relating to accrued interest and penalties, could be resolved within the next twelve months. We are not aware of any other matters that would result in significant changes to the amount of unrecognized income tax benefits reflected on the Consolidated Balance Sheet as of fiscal year end 2017. IRS Audits 1997-2000 Audit Years As previously disclosed, in fiscal 2013, the IRS effectively settled its audit of all tax matters for the years 1997 through 2000, excluding one issue involving the tax treatment of certain intercompany debt transactions. In fiscal 2016, the U.S. Tax Court resolved all aspects of the disputed debt matter for the 1997 to 2000 audit cycle and the Appeals Division of the IRS effectively settled the intercompany debt issues on appeal for subsequent audit cycles (years 2001 to 2007). In connection with these developments, in fiscal 2016, we recognized an income tax benefit of $1,135 million, representing a reduction in tax reserves, and other expense of $604 million, representing a reduction of associated indemnification receivables, pursuant to the Tax Sharing Agreement with Tyco International and Covidien. See Note 12 for further information regarding the Tax Sharing Agreement. During fiscal 2016, in connection with the disputed debt matter, we made a payment to the IRS of $443 million for tax deficiencies for which we were the primary obligor. Concurrent with remitting this payment, we received net reimbursements of $303 million from Tyco International and Covidien pursuant to their indemnifications for pre-separation tax matters. 2001-2007 Audit Years In fiscal 2015, the IRS effectively settled its audit of tax matters for the years 2001 through 2007, excluding the disputed debt matter which was subsequently resolved during fiscal 2016 as discussed above. Consequently, in fiscal 2015, we recognized an income tax benefit of $201 million, representing a reduction in tax reserves for the matters that were effectively settled, and other expense of $84 million, representing a reduction of associated indemnification receivables, pursuant to the Tax Sharing Agreement with Tyco International and Covidien. 2008-2010 Audit Years In fiscal 2015, the IRS effectively settled its audit of tax matters for the years 2008 through 2010, excluding the disputed debt matter which was subsequently resolved consistent with the terms of the disputed debt settlement discussed above. Consequently, in fiscal 2015, we recognized an income tax benefit of $63 million, representing a reduction in tax reserves for the matters that were effectively settled. |
Other Expense, Net
Other Expense, Net | 12 Months Ended |
Sep. 29, 2017 | |
Other Expense, Net | |
Other Expense, Net | 16. Other Expense, Net In fiscal 2017, 2016, and 2015, we recorded net other expense of $9 million, $632 million, and $55 million, respectively, primarily pursuant to the Tax Sharing Agreement with Tyco International and Covidien. The net other expense in fiscal 2016 included $604 million related to the effective settlement of tax matters for the years 1997 through 2000 which resolved all aspects of the disputed debt matter with the IRS through the year 2007 and $46 million related to a tax settlement in another tax jurisdiction. The net other expense in fiscal 2015 included $84 million related to the effective settlement of undisputed tax matters for the years 2001 through 2007. See Notes 12 and 15 for further information regarding the Tax Sharing Agreement and settlements, respectively. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Sep. 29, 2017 | |
Earnings Per Share. | |
Earnings Per Share | 17. Earnings Per Share The weighted-average number of shares outstanding used in the computations of basic and diluted earnings per share were as follows: Fiscal 2017 2016 2015 (in millions) Basic Dilutive impact of share-based compensation arrangements ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Diluted ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ There were one million, three million, and one million share options that were not included in the computation of diluted earnings per share for fiscal 2017, 2016, and 2015, respectively, because the instruments' underlying exercise prices were greater than the average market prices of our common shares and inclusion would be antidilutive. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Sep. 29, 2017 | |
Shareholders' Equity | |
Shareholders' Equity | 18. Shareholders' Equity Common Shares We are organized under the laws of Switzerland. The rights of holders of our shares are governed by Swiss law, our Swiss articles of association, and our Swiss organizational regulations. Accordingly, the par value of our common shares is stated in Swiss francs ("CHF"). We continue to use the U.S. dollar, however, as our reporting currency on the Consolidated Financial Statements. Subject to certain conditions specified in our articles of association, we are authorized to increase our conditional share capital by issuing new shares in aggregate not exceeding 50% of our authorized shares. In March 2016, our shareholders approved for a period of two years ending on March 2, 2018, our board of directors' authorization to issue additional new shares, subject to certain conditions specified in the articles of association, in aggregate not exceeding 50% of the amount of our authorized shares. Common Shares Held in Treasury At fiscal year end 2017, approximately 5 million common shares were held in treasury and owned by one of our subsidiaries. At fiscal year end 2016, approximately 28 million common shares were held in treasury, of which 2 million were owned by one of our subsidiaries. Shares held both directly by us and by our subsidiary are presented as treasury shares on the Consolidated Balance Sheets. In fiscal 2017, 2016, and 2015, our shareholders approved the cancellation of 26 million, 31 million, and 5 million shares, respectively, purchased under our share repurchase program. These capital reductions by cancellation of shares were subject to a notice period and filing with the commercial register in Switzerland. Contributed Surplus During fiscal 2017, cumulative equity transactions, including dividend activity and treasury share cancellations, reduced our contributed surplus balance to zero with residual activity recorded against accumulated earnings as reflected on the Consolidated Statement of Shareholders' Equity. To the extent that the contributed surplus balance continues to be zero, the impact of future transactions that normally would have been recorded as a reduction of contributed surplus will be recorded in accumulated earnings. Contributed surplus established for Swiss tax and statutory purposes ("Swiss Contributed Surplus"), is not impacted by our GAAP treatment. Swiss Contributed Surplus, subject to certain conditions, is a freely distributable reserve. As of fiscal year end 2017 and 2016, Swiss Contributed Surplus was CHF 7,300 million and CHF 7,878 million, respectively (equivalent to $6,420 million and $6,992 million, respectively). Dividends Under Swiss law, subject to certain conditions, dividends paid from reserves from capital contributions (equivalent to Swiss Contributed Surplus) are exempt from Swiss withholding tax. Dividends on our shares must be approved by our shareholders. Our shareholders approved the following dividends on our common shares: Approval Date Annual Payment Per Share Payment Dates March 2014 CHF 1.04 (equivalent to $1.16), payable in four quarterly installments of $0.29 Third quarter of fiscal 2014 March 2015 $1.32 (equivalent to CHF 1.27), payable in four quarterly installments of $0.33 Third quarter of fiscal 2015 March 2016 $1.48 (equivalent to CHF 1.48), payable in four quarterly installments of $0.37 Third quarter of fiscal 2016 March 2017 $1.60 (equivalent to CHF 1.62), payable in four quarterly installments of $0.40 Third quarter of fiscal 2017 Upon shareholders' approval of a dividend payment, we record a liability with a corresponding charge to shareholders' equity. At fiscal year end 2017 and 2016, the unpaid portion of the dividends recorded in accrued and other current liabilities on the Consolidated Balance Sheets totaled $281 million and $263 million, respectively. Share Repurchase Program During fiscal 2016 and 2015, our board of directors authorized increases of $1.0 billion and $3.0 billion, respectively, in the share repurchase program. Common shares repurchased under the share repurchase program were as follows: Fiscal 2017 2016 2015 (in millions) Number of common shares repurchased Repurchase value $ $ $ At fiscal year end 2017, we had $480 million of availability remaining under our share repurchase authorization. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Sep. 29, 2017 | |
Accumulated Other Comprehensive Income (Loss) | |
Accumulated Other Comprehensive Income (Loss) | 19. Accumulated Other Comprehensive Income (Loss) The changes in each component of accumulated other comprehensive income (loss) were as follows: Currency (1) Unrecognized Gains (Losses) Accumulated (in millions) Balance at fiscal year end 2014 $ $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive loss before reclassifications ) ) ) ) Amounts reclassified from accumulated other comprehensive income (loss) (2) Income tax benefit — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net other comprehensive income (loss), net of tax ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at fiscal year end 2015 ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive loss before reclassifications ) ) ) ) Amounts reclassified from accumulated other comprehensive income (loss) ) Income tax (expense) benefit — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net other comprehensive income (loss), net of tax ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at fiscal year end 2016 ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income before reclassifications Amounts reclassified from accumulated other comprehensive income (loss) ) ) Income tax expense — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net other comprehensive income, net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at fiscal year end 2017 $ $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Includes hedges of net investment foreign exchange gains or losses which offset foreign exchange losses or gains attributable to the translation of the net investments. (2) Represents net currency translation reclassified as a result of the sale of our BNS business. This net loss is included in income from discontinued operations on the Consolidated Statement of Operations. See Note 4 for additional information regarding the divestiture of BNS. |
Share Plans
Share Plans | 12 Months Ended |
Sep. 29, 2017 | |
Share Plans | |
Share Plans | 20. Share Plans Our equity compensation plans, of which the TE Connectivity Ltd. 2007 Stock and Incentive Plan, amended and restated as of March 8, 2017 (the "2017 Plan"), is the primary plan, provide for the award of annual performance bonuses and long-term performance awards, including share options; restricted, performance, and deferred share units; and other share-based awards (collectively, "Awards") and allow for the use of unissued shares or treasury shares to be used to satisfy such Awards. In March 2017, our shareholders approved an increase of 10 million shares in the number of shares available for awards under the 2017 Plan. As of fiscal year end 2017, our plans provided for a maximum of 77 million shares to be issued as Awards, subject to adjustment as provided under the terms of the plans. A total of 23 million shares remained available for issuance under our plans as of fiscal year end 2017. Share-Based Compensation Expense Share-based compensation expense, which was included in selling, general, and administrative expenses on the Consolidated Statements of Operations, was as follows: Fiscal 2017 2016 2015 (in millions) Share-based compensation expense $ $ $ We recognized a related tax benefit associated with our share-based compensation arrangements of $32 million, $29 million, and $29 million in fiscal 2017, 2016, and 2015, respectively. Restricted Share Awards Restricted share awards, which are generally in the form of restricted share units, are granted subject to certain restrictions. Conditions of vesting are determined at the time of grant. All restrictions on an award will lapse upon death or disability of the employee. If the employee satisfies retirement requirements, a portion of the award may vest, depending on the terms and conditions of the particular grant. Recipients of restricted share units have no voting rights, but do receive dividend equivalents. For grants that vest through passage of time, the fair value of the award at the time of the grant is amortized to expense over the period of vesting. The fair value of restricted share awards is determined based on the closing value of our shares on the grant date. Restricted share awards generally vest in increments over a period of four years as determined by the management development and compensation committee. Restricted share award activity was as follows: Shares Weighted-Average Nonvested at fiscal year end 2016 $ Granted Vested ) Forfeited ) ​ ​ ​ ​ ​ ​ ​ ​ Nonvested at fiscal year end 2017 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The weighted-average grant-date fair value of restricted share awards granted during fiscal 2017, 2016, and 2015 was $67.72, $64.88, and $62.45, respectively. The total fair value of restricted share awards that vested during fiscal 2017, 2016, and 2015 was $50 million, $51 million, and $58 million, respectively. As of fiscal year end 2017, there was $74 million of unrecognized compensation cost related to nonvested restricted share awards. The cost is expected to be recognized over a weighted-average period of 1.7 years. Performance Share Awards Performance share awards, which are generally in the form of performance share units, are granted with pay-out subject to vesting requirements and certain performance conditions that are determined at the time of grant. Based on our performance, the pay-out of performance share units can range from 0% to 200% of the number of units originally granted. The grant-date fair value of performance share awards is expensed over the period of performance once achievement of the performance criteria is deemed probable. Recipients of performance share units have no voting rights but do receive dividend equivalents. Performance share awards generally vest after a period of three years as determined by the management development and compensation committee. Performance share award activity was as follows: Shares Weighted-Average Outstanding at fiscal year end 2016 $ Granted Vested ) Forfeited ) ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at fiscal year end 2017 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ The weighted-average grant-date fair value of performance share awards granted during fiscal 2017, 2016, and 2015 was $62.88, $55.15, and $61.65, respectively. The total fair value of performance share awards that vested during both fiscal 2017 and 2016 was $15 million. The total fair value of performance share awards that vested in fiscal 2015 was insignificant. As of fiscal year end 2017, there was $28 million of unrecognized compensation cost related to nonvested performance share awards. The cost is expected to be recognized over a weighted-average period of 1.2 years. Share Options Share options are granted to purchase our common shares at prices which are equal to or greater than the market price of the common shares on the date the option is granted. Conditions of vesting are determined at the time of grant. All restrictions on the award will lapse upon death or disability of the employee. If the employee satisfies retirement requirements, a portion of the award may vest, depending on the terms and conditions of the particular grant. Options generally vest and become exercisable in equal annual installments over a period of four years and expire ten years after the date of grant. Share option award activity was as follows: Shares Weighted-Average Weighted-Average Aggregate (in years) (in millions) Outstanding at fiscal year end 2016 $ Granted Exercised ) Expired ) Forfeited ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at fiscal year end 2017 $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vested and expected to vest at fiscal year end 2017 $ $ Exercisable at fiscal year end 2017 $ $ The weighted-average exercise price of share option awards granted during fiscal 2017, 2016, and 2015 was $66.76, $65.70, and $61.70, respectively. The total intrinsic value of options exercised during fiscal 2017, 2016, and 2015 was $130 million, $67 million, and $107 million, respectively. We received cash related to the exercise of options of $117 million, $90 million, and $103 million in fiscal 2017, 2016, and 2015, respectively. As of fiscal year end 2017, there was $37 million of unrecognized compensation cost related to nonvested share options granted under our share option plans. The cost is expected to be recognized over a weighted-average period of 1.9 years. Share-Based Compensation Assumptions The grant-date fair value of each share option grant was estimated using the Black-Scholes-Merton option pricing model. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. We employ our historical share volatility when calculating the grant-date fair value of our share option grants using the Black-Scholes-Merton option pricing model. Currently, we do not have exchange-traded options of sufficient duration to employ an implied volatility assumption in the calculation and therefore rely solely on the historical volatility calculation. The average expected life was based on the contractual term of the option and expected employee exercise and post-vesting employment termination behavior. The risk-free interest rate was based on U.S. Treasury zero-coupon issues with a remaining term that approximated the expected life assumed at the date of grant. The expected annual dividend per share was based on our expected dividend rate. The recognized share-based compensation expense was net of estimated forfeitures, which are based on voluntary termination behavior as well as an analysis of actual option forfeitures. The weighted-average grant-date fair value of options granted and the weighted-average assumptions we used in the Black-Scholes-Merton option pricing model were as follows: Fiscal 2017 2016 2015 Weighted-average grant-date fair value $ $ $ Assumptions: Expected share price volatility % % % Risk free interest rate % % % Expected annual dividend per share $ $ $ Expected life of options (in years) |
Segment and Geographic Data
Segment and Geographic Data | 12 Months Ended |
Sep. 29, 2017 | |
Segment and Geographic Data | |
Segment and Geographic Data | 21. Segment and Geographic Data We operate through three reportable segments: Transportation Solutions, Industrial Solutions, and Communications Solutions. See Note 1 for a description of the segments in which we operate. We aggregate our operating segments into reportable segments based upon similar economic characteristics and business groupings of products, services, and customers. Segment performance is evaluated based on net sales and operating income. Generally, we consider all expenses to be of an operating nature and, accordingly, allocate them to each reportable segment. Costs specific to a segment are charged to the segment. Corporate expenses, such as headquarters administrative costs, are allocated to the segments based on segment operating income. Intersegment sales were not material and were recorded at selling prices that approximate market prices. Corporate assets are allocated to the segments based on segment assets. Net sales and operating income by segment were as follows: Net Sales Operating Income Fiscal Fiscal 2017 2016 2015 2017 2016 2015 (in millions) Transportation Solutions $ $ $ $ $ $ Industrial Solutions Communications Solutions (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Includes pre-tax gain of $144 million on the sale of our CPD business during fiscal 2016. No single customer accounted for a significant amount of our net sales in fiscal 2017, 2016, or 2015. As we are not organized by product or service, it is not practicable to disclose net sales by product or service. Depreciation and amortization and capital expenditures were as follows: Depreciation and Amortization Capital Expenditures Fiscal Fiscal 2017 2016 2015 2017 2016 2015 (in millions) Transportation Solutions $ $ $ $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Segment assets and a reconciliation of segment assets to total assets were as follows: Segment Assets Fiscal Year End 2017 2016 2015 (in millions) Transportation Solutions $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total segment assets (1) Other current assets Other non-current assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Segment assets are composed of accounts receivable, inventories, and net property, plant, and equipment. Net sales and net property, plant, and equipment by geographic region were as follows: Net Sales (1) Property, Plant, and Fiscal Fiscal Year End 2017 2016 2015 2017 2016 2015 (in millions) Americas: U.S. $ $ $ $ $ $ Other Americas ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Americas ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Europe/Middle East/Africa: Switzerland Germany Other Europe/Middle East/Africa ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Europe/Middle East/Africa ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Asia–Pacific: China Other Asia–Pacific ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Asia–Pacific ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Net sales to external customers is attributed to individual countries based on the legal entity that records the sale. |
Quarterly Financial Data (unaud
Quarterly Financial Data (unaudited) | 12 Months Ended |
Sep. 29, 2017 | |
Quarterly Financial Data (unaudited) | |
Quarterly Financial Data (unaudited) | 22. Quarterly Financial Data (unaudited) Summarized quarterly financial data was as follows: Fiscal 2017 2016 First Second Third Fourth First Second (1) Third (2) Fourth (3) (in millions, except per share data) Net sales $ $ $ $ $ $ $ $ Gross margin Acquisition and integration costs Restructuring and other charges (credits), net ) Income from continuing operations Income (loss) from discontinued operations, net of income taxes ) ) — Net income $ $ $ $ $ $ $ $ Basic earnings per share: Income from continuing operations $ $ $ $ $ $ $ $ Net income Diluted earnings per share: Income from continuing operations $ $ $ $ $ $ $ $ Net income (1) Results for the second quarter of fiscal 2016 included a pre-tax gain of $146 million on the sale of our CPD business. (2) Results for the third quarter of fiscal 2016 included a $1,135 million income tax benefit associated with the effective settlement of tax matters for the years 1997 through 2000 which resolved all aspects of the disputed debt matter with the IRS through the year 2007 and the related impact of $604 million to other expense pursuant to the Tax Sharing Agreement with Tyco International and Covidien. In addition, results for the third quarter of fiscal 2016 included a $91 million income tax charge related to an increase to the valuation allowance for certain U.S. deferred tax assets, and an $83 million net income tax benefit related to tax settlements in certain other tax jurisdictions and the related impact of $46 million to other expense pursuant to the Tax Sharing Agreement with Tyco International and Covidien. (3) Results for the fourth quarter of fiscal 2016 included an additional week. See Note 1 for additional information regarding our fiscal year end. |
Tyco Electronics Group S.A.
Tyco Electronics Group S.A. | 12 Months Ended |
Sep. 29, 2017 | |
Tyco Electronics Group S.A. | |
Tyco Electronics Group S.A. | 23. Tyco Electronics Group S.A. Tyco Electronics Group S.A. ("TEGSA"), a Luxembourg company and our 100%-owned subsidiary, is a holding company that owns, directly or indirectly, all of our operating subsidiaries. TEGSA is the obligor under our senior notes, commercial paper, and Credit Facility, which are fully and unconditionally guaranteed by its parent, TE Connectivity Ltd. The following tables present condensed consolidating financial information for TE Connectivity Ltd., TEGSA, and all other subsidiaries that are not providing a guarantee of debt but which represent assets of TEGSA, using the equity method of accounting. Condensed Consolidating Statement of Operations TE TEGSA Other Consolidating Total (in millions) Net sales $ — $ — $ $ — $ Cost of sales — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross margin — — — Selling, general, and administrative expenses, net (1) ) — Research, development, and engineering expenses — — — Acquisition and integration costs — — — Restructuring and other charges, net — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income (loss) ) ) — Interest income — — — Interest expense — ) ) — ) Other expense, net — — ) — ) Equity in net income of subsidiaries — ) — Equity in net income of subsidiaries of discontinued operations — ) — Intercompany interest income (expense), net ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes ) Income tax expense — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations ) Income (loss) from discontinued operations, net of income taxes (2) — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income ) Other comprehensive income ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) TEGSA selling, general and administrative expenses include losses of $1,965 million related to intercompany transactions. These losses are offset by corresponding gains recorded by other subsidiaries. (2) Includes the internal allocation of gains and losses associated with the divestiture of our BNS business. Condensed Consolidating Statement of Operations TE TEGSA Other Consolidating Total (in millions) Net sales $ — $ — $ $ — $ Cost of sales — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross margin — — — Selling, general, and administrative expenses, net (1) — Research, development, and engineering expenses — — — Acquisition and integration costs — — — Restructuring and other charges (credits), net ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income (loss) ) ) — Interest income — — — Interest expense — ) ) — ) Other expense, net — — ) — ) Equity in net income of subsidiaries — ) — Equity in net income of subsidiaries of discontinued operations — ) — Intercompany interest income (expense), net ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes ) Income tax benefit — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations ) Income (loss) from discontinued operations, net of income taxes (2) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income ) Other comprehensive loss ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) TEGSA selling, general, and administrative expenses include losses of $80 million related to intercompany transactions. These losses are offset by corresponding gains recorded by other subsidiaries. (2) Includes the internal allocation of gains and losses associated with the divestiture of our BNS business. Condensed Consolidating Statement of Operations TE TEGSA Other Consolidating Total (in millions) Net sales $ — $ — $ $ — $ Cost of sales — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross margin — — — Selling, general, and administrative expenses, net (1) — Research, development, and engineering expenses — — — Acquisition and integration costs — — — Restructuring and other charges, net — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income (loss) ) ) — Interest income — — — Interest expense — ) ) — ) Other expense, net — — ) — ) Equity in net income of subsidiaries — ) — Equity in net income of subsidiaries of discontinued operations — ) — Intercompany interest income (expense), net ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes ) Income tax expense — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations ) Income from discontinued operations, net of income taxes — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income ) Other comprehensive loss ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) TEGSA selling, general, and administrative expenses include losses of $846 million related to intercompany transactions. These losses are offset by corresponding gains recorded by other subsidiaries. Condensed Consolidating Balance Sheet TE TEGSA Other Consolidating Total (in millions) Assets Current assets: Cash and cash equivalents $ — $ — $ $ — $ Accounts receivable, net — — — Inventories — — — Intercompany receivables ) — Prepaid expenses and other current assets — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current assets ) Property, plant, and equipment, net — — — Goodwill — — — Intangible assets, net — — — Deferred income taxes — — — Investment in subsidiaries — ) — Intercompany loans receivable — ) — Other assets — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Assets $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities and Shareholders' Equity Current liabilities: Short-term debt $ — $ $ $ — $ Accounts payable — — Accrued and other current liabilities — Deferred revenue — — — Intercompany payables — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current liabilities ) Long-term debt — — Intercompany loans payable — ) — Long-term pension and postretirement liabilities — — — Deferred income taxes — — — Income taxes — — — Other liabilities — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Shareholders' Equity ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities and Shareholders' Equity $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Condensed Consolidating Balance Sheet TE TEGSA Other Consolidating Total (in millions) Assets Current assets: Cash and cash equivalents $ — $ — $ $ — $ Accounts receivable, net — — — Inventories — — — Intercompany receivables ) — Prepaid expenses and other current assets — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current assets ) Property, plant, and equipment, net — — — Goodwill — — — Intangible assets, net — — — Deferred income taxes — — — Investment in subsidiaries — ) — Intercompany loans receivable ) — Other assets — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Assets $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities and Shareholders' Equity Current liabilities: Short-term debt $ — $ $ $ — $ Accounts payable — — Accrued and other current liabilities — Deferred revenue — — — Intercompany payables — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current liabilities ) Long-term debt — — Intercompany loans payable — ) — Long-term pension and postretirement liabilities — — — Deferred income taxes — — — Income taxes — — — Other liabilities — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Shareholders' Equity ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities and Shareholders' Equity $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Condensed Consolidating Statement of Cash Flows TE TEGSA Other Consolidating Total (in millions) Cash Flows From Operating Activities: Net cash provided by (used in) continuing operating activities (1) $ ) $ $ $ ) $ Net cash used in discontinued operating activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) operating activities ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: Capital expenditures — — ) — ) Proceeds from sale of property, plant, and equipment — — — Acquisition of businesses, net of cash acquired — — ) — ) Proceeds from divestiture of business, net of cash retained by sold business — — — Intercompany distribution receipts (1) — — ) — Change in intercompany loans — ) — — Other — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in investing activities — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: Changes in parent company equity (2) ) — — Net decrease in commercial paper — ) — — ) Proceeds from issuance of debt — — — Proceeds from exercise of share options — — — Repurchase of common shares — — ) — ) Payment of common share dividends to shareholders ) — — ) Intercompany distributions (1) — ) ) — Loan activity with parent — ) — Transfers to discontinued operations — — ) — ) Other — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) continuing financing activities ) ) ) Net cash provided by discontinued financing activities — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) financing activities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of currency translation on cash — — ) — ) Net increase in cash and cash equivalents — — — Cash and cash equivalents at beginning of fiscal year — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents at end of fiscal year $ — $ — $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) During fiscal 2017, other subsidiaries made distributions to TEGSA in the amount of $696 million and TEGSA made distributions to TE Connectivity Ltd. in the amount of $50 million. Cash flows are presented based upon the nature of the distributions. (2) Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity. Condensed Consolidating Statement of Cash Flows TE TEGSA Other Consolidating Total (in millions) Cash Flows From Operating Activities: Net cash provided by (used in) continuing operating activities (1) $ ) $ $ $ ) $ Net cash used in discontinued operating activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) operating activities ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: Capital expenditures — — ) — ) Proceeds from sale of property, plant, and equipment — — — Acquisition of businesses, net of cash acquired — — ) — ) Proceeds from divestiture of business, net of cash retained by sold business — — Proceeds from divestiture of discontinued operations, net of cash retained by sold operations (2) — ) — ) Intercompany distribution receipts (1) — ) — Change in intercompany loans — ) — — Other — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) investing activities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: Changes in parent company equity (3) ) — — Net increase in commercial paper — — — Proceeds from issuance of debt — — Repayment of debt — ) ) — ) Proceeds from exercise of share options — — — Repurchase of common shares ) — ) — ) Payment of common share dividends to shareholders ) — — ) Intercompany distributions (1) — ) ) — Loan activity with parent — ) ) — Transfers to discontinued operations — — ) — ) Other — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in continuing financing activities ) ) ) ) Net cash provided by discontinued financing activities — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in financing activities ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of currency translation on cash — — — Net decrease in cash and cash equivalents — — ) — ) Cash and cash equivalents at beginning of fiscal year — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents at end of fiscal year $ — $ — $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) During fiscal 2016, other subsidiaries made distributions to TEGSA in the amount of $1,897 million and TEGSA made distributions to TE Connectivity Ltd. in the amount of $1,250 million. Cash flows are presented based upon the nature of the distributions. (2) Includes the internal allocation of proceeds between TEGSA and other subsidiaries associated with the divestiture of our BNS business. (3) Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity. Condensed Consolidating Statement of Cash Flows TE TEGSA Other Consolidating Total (in millions) Cash Flows From Operating Activities: Net cash provided by continuing operating activities (1) $ $ $ $ ) $ Net cash provided by discontinued operating activities — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: Capital expenditures — — ) — ) Proceeds from sale of property, plant, and equipment — — — Acquisition of businesses, net of cash acquired — — ) — ) Proceeds from divestiture of discontinued operations, net of cash retained by sold operations — — Change in intercompany loans — ) — — Other — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) continuing investing activities — ) ) Net cash used in discontinued investing activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) investing activities — ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: Changes in parent company equity (2) ) — — Net decrease in commercial paper — ) — — ) Proceeds from issuance of debt — — — Repayment of debt — ) ) — ) Proceeds from exercise of share options — — — Repurchase of common shares ) — ) — ) Payment of common share dividends to shareholders ) — — ) Intercompany distributions (1) — ) ) — Loan activity with parent — ) — Transfers from discontinued operations — — — Other — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in continuing financing activities ) ) ) ) Net cash used in discontinued financing activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in financing activities ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of currency translation on cash — — ) — ) Net increase (decrease) in cash and cash equivalents — ) — Cash and cash equivalents at beginning of fiscal year — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents at end of fiscal year $ — $ — $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) During fiscal 2015, other subsidiaries made distributions to TEGSA in the amount of $1,326 million and TEGSA made distributions to TE Connectivity Ltd. in the amount of $1,335 million. Cash flows are presented based upon the nature of the distributions. (2) Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity. |
SCHEDULE II-VALUATION AND QUALI
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Sep. 29, 2017 | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II—VALUATION AND QUALIFYING ACCOUNTS Fiscal Years Ended September 29, 2017, September 30, 2016, and September 25, 2015 Description Balance at Additions Acquisitions, Deductions Balance at (in millions) Fiscal 2017: Allowance for doubtful accounts receivable $ $ $ — $ ) $ Valuation allowance on deferred tax assets — ) Fiscal 2016: Allowance for doubtful accounts receivable $ $ — $ $ ) $ Valuation allowance on deferred tax assets ) Fiscal 2015: Allowance for doubtful accounts receivable $ $ $ $ ) $ Valuation allowance on deferred tax assets ) |
Summary of Significant Accoun32
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 29, 2017 | |
Summary of Significant Accounting Policies | |
Basis of Accounting | Basis of Presentation The Consolidated Financial Statements reflect the consolidated operations of TE Connectivity Ltd. and its subsidiaries and have been prepared in United States ("U.S.") dollars in accordance with accounting principles generally accepted in the U.S. ("GAAP"). |
Use of Estimates | Use of Estimates The preparation of the Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses. Significant estimates in these Consolidated Financial Statements include restructuring and other charges, assets acquired and liabilities assumed in acquisitions, allowances for doubtful accounts receivable, estimates of future cash flows and discount rates associated with asset impairments, useful lives for depreciation and amortization, loss contingencies, net realizable value of inventories, estimated contract revenue and related costs, legal contingencies, tax reserves and deferred tax asset valuation allowances, and the determination of discount and other rate assumptions for pension benefit cost. Actual results could differ materially from these estimates. |
Fiscal Year | Fiscal Year We have a 52- or 53-week fiscal year that ends on the last Friday of September. For fiscal years in which there are 53 weeks, the fourth quarter reporting period includes 14 weeks. Fiscal 2017, 2016, and 2015 ended on September 29, 2017, September 30, 2016, and September 25, 2015, respectively. Fiscal 2017 and 2015 were 52 weeks in length. Fiscal 2016 was a 53-week year. |
Principles of Consolidation | Principles of Consolidation We consolidate entities in which we own or control more than 50% of the voting shares or otherwise have the ability to control through similar rights. All intercompany transactions have been eliminated. The results of companies acquired or disposed of are included on the Consolidated Financial Statements from the effective date of acquisition or up to the date of disposal. |
Revenue Recognition | Revenue Recognition Our revenues are generated principally from the sale of our products. Revenue from the sale of products is recognized at the time title and the risks and rewards of ownership pass to the customer. This generally occurs when the products reach the shipping point, the sales price is fixed and determinable, and collection is reasonably assured. Contract revenues for construction related projects, which are generated in the Communications Solutions segment, are recorded primarily using the percentage-of-completion method. Profits recognized on contracts in process are based upon estimated contract revenue and related cost to complete. Percentage-of-completion is measured based on the ratio of actual costs incurred to total estimated costs. Revisions in cost estimates as contracts progress have the effect of increasing or decreasing profits in the current period. Provisions for anticipated losses are made in the period in which they first become determinable. In addition, provisions for credit losses related to unbilled receivables on construction related projects are recorded as reductions of revenue in the period in which they first become determinable. We generally warrant that our products will conform to our, or mutually agreed to, specifications and that our products will be free from material defects in materials and workmanship for a limited time. We limit our warranty to the replacement or repair of defective parts, or a refund or credit of the price of the defective product. We accept returned goods only when the customer makes a verified claim and we have authorized the return. Generally, a reserve for estimated returns is established at the time of sale based on historical return experience and is recorded as a reduction of sales. Additionally, certain of our long-term contracts in the Communications Solutions segment have warranty obligations. Estimated warranty costs for each contract are determined based on the contract terms and technology-specific considerations. These costs are included in total estimated contract costs and are accrued over the construction period of the respective contracts under percentage-of-completion accounting. We provide certain distributors with an inventory allowance for returns or scrap equal to a percentage of qualified purchases. A reserve for estimated returns and scrap allowances is established at the time of the sale based on an agreed-upon, fixed percentage of sales to distributors and is recorded as a reduction of sales. Other allowances include customer quantity and price discrepancies. A reserve for other allowances is generally established at the time of sale based on historical experience and is recorded as a reduction of sales. We believe we can reasonably and reliably estimate the amounts of future allowances. |
Inventories | Inventories Inventories are recorded at the lower of cost or market value using the first-in, first-out cost method, except for inventoried costs incurred in the performance of long-term contracts primarily by the Communications Solutions segment. |
Property, Plant and Equipment, Net | Property, Plant, and Equipment, Net Property, plant, and equipment is recorded at cost less accumulated depreciation. Maintenance and repair expenditures are charged to expense when incurred. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which are 10 to 20 years for land improvements, 5 to 40 years for buildings and improvements, and 1 to 15 years for machinery and equipment. We periodically evaluate, when events and circumstances warrant, the net realizable value of property, plant, and equipment and other long-lived assets, relying on a number of factors including operating results, business plans, economic projections, and anticipated future cash flows. When indicators of potential impairment are present, the carrying values of the asset group are evaluated in relation to the operating performance and estimated future undiscounted cash flows of the underlying asset group. Impairment of the carrying value is recognized whenever anticipated future undiscounted cash flow estimates are less than the carrying value of the asset. Fair value estimates are based on assumptions concerning the amount and timing of estimated future cash flows and discount rates, reflecting varying degrees of perceived risk. |
Goodwill and Other Intangible Assets | Goodwill and Other Intangible Assets Intangible assets include both indeterminable-lived residual goodwill and determinable-lived identifiable intangible assets. Intangible assets with determinable lives primarily include intellectual property, consisting of patents, trademarks, and unpatented technology, and customer relationships. Recoverability estimates range from 1 to 50 years and costs are generally amortized on a straight-line basis. Evaluations of the remaining useful lives of determinable-lived intangible assets are performed on a periodic basis and when events and circumstances warrant. At fiscal year end 2017, we had six reporting units, five of which contained goodwill. There were two reporting units in each of our three segments. When changes occur in the composition of one or more reporting units, goodwill is reassigned to the reporting units affected based on their relative fair values. Goodwill impairment is evaluated by comparing the carrying value of each reporting unit to its fair value on the first day of the fourth fiscal quarter of each year or whenever we believe a triggering event requiring a more frequent assessment has occurred. In assessing the existence of a triggering event, management relies on a number of reporting unit-specific factors including operating results, business plans, economic projections, anticipated future cash flows, transactions, and market place data. There are inherent uncertainties related to these factors and management's judgment in applying these factors to the impairment analysis. When testing for goodwill impairment, we perform a step I goodwill impairment test to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount. If the carrying amount of a reporting unit exceeds its fair value, goodwill may be impaired and a step II goodwill impairment test is performed to measure the amount of impairment, if any. In the step II goodwill impairment test, we compare the implied fair value of reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to the excess. The implied fair value of goodwill is determined in a manner consistent with how goodwill is recognized in a business combination. We allocate the fair value of a reporting unit to the assets and liabilities of that unit, including intangible assets, as if the reporting unit had been acquired in a business combination. Any excess of the fair value of a reporting unit over the amounts assigned to its assets and liabilities is the implied fair value of goodwill. Fair value estimates used in the step I goodwill impairment tests are calculated using an income approach based on the present value of future cash flows of each reporting unit. The income approach generally has been supported by guideline analyses (a market approach). These approaches incorporate a number of assumptions including future growth rates, discount rates, income tax rates, and market activity in assessing fair value and are reporting unit specific. Changes in economic and operating conditions impacting these assumptions could result in goodwill impairments in future periods. |
Research and Development | Research and Development Research and development expenditures are expensed when incurred and are included in research, development, and engineering expenses on the Consolidated Statements of Operations. Research and development expenses include salaries, direct costs incurred, and building and overhead expenses. The amounts expensed in fiscal 2017, 2016, and 2015 were $595 million, $566 million, and $540 million, respectively. |
Income Taxes | Income Taxes Income taxes are computed in accordance with the provisions of Accounting Standards Codification ("ASC") 740, Income Taxes . Deferred tax liabilities and assets are recognized for the expected future tax consequences of events that have been reflected on the Consolidated Financial Statements. Deferred tax liabilities and assets are determined based on the differences between the book and tax bases of particular assets and liabilities and operating loss carryforwards using tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is provided to offset deferred tax assets if, based upon the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The calculation of our tax liabilities includes estimates for uncertainties in the application of complex tax regulations across multiple global jurisdictions where we conduct our operations. Under the uncertain tax position provisions of ASC 740, we recognize liabilities for tax and related interest for issues in tax jurisdictions based on our estimate of whether, and the extent to which, additional taxes and related interest will be due. These tax liabilities and related interest are reflected net of the impact of related tax loss carryforwards, as such tax loss carryforwards will be applied against these tax liabilities and will reduce the amount of cash tax payments due upon the eventual settlement with the tax authorities. These estimates may change due to changing facts and circumstances. Due to the complexity of these uncertainties, the ultimate resolution may result in a settlement that differs from our current estimate of the tax liabilities and related interest. |
Financial Instruments | Financial Instruments Our financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, debt, and derivative financial instruments. We account for derivative financial instrument contracts on the Consolidated Balance Sheets at fair value. For instruments not designated as hedges under ASC 815, Derivatives and Hedging , the changes in the instruments' fair value are recognized currently in earnings. For instruments designated as cash flow hedges, the effective portion of changes in the fair value of a derivative is recorded in other comprehensive income (loss) and reclassified into earnings in the same period or periods during which the underlying hedged item affects earnings. Ineffective portions of a cash flow hedge, including amounts excluded from the hedging relationship, are recognized currently in earnings. Changes in the fair value of instruments designated as fair value hedges affect the carrying value of the asset or liability hedged, with changes in both the derivative instrument and the hedged asset or liability being recognized currently in earnings. We determine the fair value of our financial instruments by using methods and assumptions that are based on market conditions and risks existing at each balance sheet date. Standard market conventions are used to determine the fair value of financial instruments, including derivatives. The cash flows related to derivative financial instruments are reported in the operating activities section of the Consolidated Statements of Cash Flows. Our derivative financial instruments present certain market and counterparty risks. Concentration of counterparty risk is mitigated, however, by our use of financial institutions worldwide, substantially all of which have long-term Standard & Poor's, Moody's, and/or Fitch credit ratings of A/A2 or higher. In addition, we utilize only conventional derivative financial instruments. We are exposed to potential losses if a counterparty fails to perform according to the terms of its agreement. With respect to counterparty net asset positions recognized at fiscal year end 2017, we have assessed the likelihood of counterparty default as remote. We currently provide guarantees from a wholly-owned subsidiary to the counterparties to our commodity swap derivatives and exchange cash collateral with the counterparties to our cross-currency swap contracts. The likelihood of performance on the guarantees has been assessed as remote. For all other derivative financial instruments, we are not required to provide, nor do we require counterparties to provide, collateral or other security. |
Fair Value Measurements | Fair Value Measurements ASC 820, Fair Value Measurements and Disclosures , specifies a fair value hierarchy based upon the observable inputs utilized in valuation of certain assets and liabilities. Observable inputs (highest level) reflect market data obtained from independent sources, while unobservable inputs (lowest level) reflect internally developed market assumptions. Fair value measurements are classified under the following hierarchy: • Level 1. Quoted prices in active markets for identical assets and liabilities. • Level 2. Quoted prices in active markets for similar assets and liabilities, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability. • Level 3. Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flows methodologies, and similar techniques that use significant unobservable inputs. Derivative financial instruments measured at fair value on a recurring basis are generally valued using level 2 inputs. Financial instruments other than derivative instruments include cash and cash equivalents, accounts receivable, accounts payable, and debt. These instruments are recorded on the Consolidated Balance Sheets at book value. For cash and cash equivalents, accounts receivable, and accounts payable, we believe book value approximates fair value due to the short-term nature of these instruments. See Note 11 for disclosure of the fair value of debt. The following is a description of the valuation methodologies used for the respective financial instruments: • Cash and cash equivalents. Cash and cash equivalents are valued at book value, which we consider to be equivalent to unadjusted quoted prices (level 1). • Accounts receivable. Accounts receivable are valued based on the net value expected to be realized. The net realizable value generally represents an observable contractual agreement (level 2). • Accounts payable. Accounts payable are valued based on the net value expected to be paid, generally supported by an observable contractual agreement (level 2). • Debt. The fair value of debt, including both current and non-current maturities, is derived from quoted market prices or other pricing determinations based on the results of market approach valuation models using observable market data such as recently reported trades, bid and offer information, and benchmark securities (level 2). |
Pension | Pension Liabilities The funded status of our defined benefit pension plans is recognized on the Consolidated Balance Sheets and is measured as the difference between the fair value of plan assets and the projected benefit obligation at the measurement date. The projected benefit obligation represents the actuarial present value of benefits projected to be paid upon retirement factoring in estimated future compensation levels. The fair value of plan assets represents the current market value of cumulative company and participant contributions made to irrevocable trust funds, held for the sole benefit of participants, which are invested by the trustee of the funds. The benefits under our defined benefit pension plans are based on various factors, such as years of service and compensation. Net periodic pension benefit cost is based on the utilization of the projected unit credit method of calculation and is charged to earnings on a systematic basis over the expected average remaining service lives of current participants. The measurement of benefit obligations and net periodic benefit cost is based on estimates and assumptions determined by our management. These valuations reflect the terms of the plans and use participant-specific information such as compensation, age, and years of service, as well as certain assumptions, including estimates of discount rates, expected return on plan assets, rate of compensation increases, interest crediting rates, and mortality rates. |
Share-Based Compensation | Share-Based Compensation We determine the fair value of share awards on the date of grant. Share options are valued using the Black-Scholes-Merton valuation model; restricted share awards and performance awards are valued using our end-of-day share price on the date of grant. The fair value is expensed ratably over the expected service period, with an allowance made for estimated forfeitures based on historical employee activity. Estimates regarding the attainment of performance criteria are reviewed periodically; the cumulative impact of a change in estimate regarding the attainment of performance criteria is recorded in the period in which that change is made. |
Earnings Per Share | Earnings Per Share Basic earnings per share is computed by dividing net income by the basic weighted-average number of common shares outstanding. Diluted earnings per share is computed by dividing net income by the weighted-average number of common shares outstanding adjusted for the potentially dilutive impact of share-based compensation arrangements. |
Currency Translation | Currency Translation For our non-U.S. dollar functional currency subsidiaries, assets and liabilities are translated into U.S. dollars using fiscal year end exchange rates. Sales and expenses are translated at average monthly exchange rates. Foreign currency translation gains and losses are included as a component of accumulated other comprehensive income (loss) within equity. Gains and losses resulting from foreign currency transactions, which are included in earnings, were immaterial in fiscal 2017, 2016, and 2015. |
Restructuring Charges | Restructuring Charges Restructuring activities involve employee-related termination costs, facility exit costs, and asset impairments resulting from reductions-in-force, migration of facilities or product lines from higher-cost to lower-cost countries, or consolidation of facilities within countries. We recognize termination costs based on requirements established by severance policy, government law, or previous actions. Facility exit costs generally reflect the cost to terminate a facility lease before the end of its term (measured at fair value at the time we cease using the facility) or costs that will continue to be incurred under the facility lease without future economic benefit to us. Restructuring activities often result in the disposal or abandonment of assets that require an acceleration of depreciation or impairment reflecting the excess of the assets' carrying values over fair value. The recognition of restructuring costs require that we make certain judgments and estimates regarding the nature, timing, and amount of costs associated with the planned exit activity. To the extent our actual results differ from our estimates and assumptions, we may be required to revise the estimated liabilities, requiring the recognition of additional restructuring costs or the reduction of liabilities already recognized. At the end of each reporting period, we evaluate the remaining accrued balances to ensure these balances are properly stated and the utilization of the reserves are for their intended purpose in accordance with developed exit plans. |
Acquisitions | Acquisitions We account for acquired businesses using the acquisition method of accounting. This method requires, among other things, that most assets acquired and liabilities assumed be recognized at fair value as of the acquisition date. We allocate the purchase price of acquired businesses to the tangible and intangible assets acquired and liabilities assumed based on estimated fair values, or as required by ASC 805, Business Combinations . The excess of the purchase price over the identifiable assets acquired and liabilities assumed is recorded as goodwill. We may engage independent third-party appraisal firms to assist us in determining the fair values of assets acquired and liabilities assumed. Such valuations require management to make significant estimates and assumptions, especially with respect to intangible assets. |
Contingent Liabilities | Contingent Liabilities We record a loss contingency when the available information indicates it is probable that we have incurred a liability and the amount of the loss is reasonably estimable. When a range of possible losses with equal likelihood exists, we record the low end of the range. The likelihood of a loss with respect to a particular contingency is often difficult to predict, and determining a meaningful estimate of the loss or a range of loss may not be practicable based on information available. In addition, it is not uncommon for such matters to be resolved over many years, during which time relevant developments and new information must continuously be evaluated to determine whether a loss is probable and a reasonable estimate of that loss can be made. When a loss is probable but a reasonable estimate cannot be made, or when a loss is at least reasonably possible, disclosure is provided. |
Recently Issued and Adopted Accounting Pronouncements | Recently Issued Accounting Pronouncements In October 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-16, an update to ASC 740, Income Taxes . This new guidance requires the recognition of the income tax consequences of intra-entity transfers of assets other than inventory in the period in which the transfer occurs. The update, which we will adopt on a modified retrospective basis, is effective for us in the first quarter of fiscal 2019. Based on amounts recorded as of September 29, 2017, adoption would result in approximately a $120 million cumulative-effect adjustment to beginning accumulated earnings and a $120 million decrease in total assets, primarily in other assets. Future transactions prior to adoption of this update could significantly change the impact at adoption. In February 2016, the FASB issued ASU No. 2016-02 which codified ASC 842, Leases . This guidance, which requires lessees to recognize a lease liability and a right-of-use asset for most leases, is effective for us in the first quarter of fiscal 2020. We will adopt the new standard using a modified retrospective transition approach which requires application of the new guidance for all periods presented. We are currently assessing the impact that adoption will have on our financial position. In May 2014, the FASB issued ASU No. 2014-09 which codified ASC topic 606, Revenue from Contracts with Customers . This guidance supersedes ASC 605, Revenue Recognition , and introduces a single, comprehensive, five-step revenue recognition model. ASC 606 also enhances disclosures related to revenue recognition. ASC 606, as amended, is effective for us in the first quarter of fiscal 2019 and allows for either a full retrospective or a modified retrospective approach at adoption. We are continuing to assess the impact of adopting ASC 606. Based on the initial evaluation of our current contracts and revenue streams, we do not expect that adoption will have a material impact on our results of operations or financial position and plan to adopt the new standard using the modified retrospective approach. We are in the process of identifying necessary changes to accounting policies, processes, financial statement disclosures, internal controls, and systems to enable compliance with this new standard. We believe we are following an appropriate timeline to allow for the proper recognition, reporting, and disclosure of revenue upon adoption of ASC 606 at the beginning of fiscal 2019. Recently Adopted Accounting Pronouncements In March 2016, the FASB issued ASU No. 2016-09, an update to ASC 718, Compensation—Stock Compensation , to simplify various aspects of accounting for share-based payments to employees. We elected to early adopt this update in fiscal 2017. The provisions of the update addressing the accounting for excess tax benefits and deficiencies were adopted using a modified retrospective transition approach, with a cumulative-effect adjustment to beginning accumulated earnings and a corresponding increase in deferred tax assets of $165 million. The provision of the update addressing the presentation on the statement of cash flows of employee taxes paid via the withholding of shares was applied retrospectively and did not have a material impact on our Consolidated Financial Statements. Adoption of other provisions, which were applied prospectively, also did not have a material impact on our Consolidated Financial Statements. |
Restructuring and Other Charg33
Restructuring and Other Charges, Net (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Restructuring and Other Charges, Net | |
Schedule of restructuring and other charges | Fiscal 2017 2016 2015 (in millions) Restructuring charges, net $ $ $ Gain on divestiture — ) — Other charges, net ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Net restructuring charges by segment | Fiscal 2017 2016 2015 (in millions) Transportation Solutions $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Restructuring charges, net $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Summary of activity in restructuring reserves | Balance at Charges Changes in Cash Non-Cash Currency Balance at (in millions) Fiscal 2017 Activity: Fiscal 2017 Actions: Employee severance $ — $ $ ) $ ) $ — $ $ Facility and other exit costs — — ) — — Property, plant, and equipment — — — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2016 Actions: Employee severance ) ) — — Facility and other exit costs — — ) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2015 Actions: Employee severance — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-Fiscal 2015 Actions: Employee severance — ) ) — ) Facility and other exit costs — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total fiscal 2017 activity $ $ $ ) $ ) $ ) $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2016 Activity: Fiscal 2016 Actions: Employee severance $ — $ $ — $ ) $ — $ — $ Facility and other exit costs — — ) — — — Property, plant, and equipment — — — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total — — ) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal 2015 Actions: Employee severance ) ) — — Facility and other exit costs — — ) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-Fiscal 2015 Actions: Employee severance — ) ) — Facility and other exit costs — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total fiscal 2016 activity $ $ $ ) $ ) $ ) $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at Charges Changes in Cash Non-Cash Currency Balance at (in millions) Fiscal 2015 Activity: Fiscal 2015 Actions: Employee severance $ — $ $ — $ ) $ — $ — $ Facility and other exit costs — — ) — — Property, plant, and equipment — — — ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total — — ) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-Fiscal 2015 Actions: Employee severance ) ) — ) Facility and other exit costs — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total fiscal 2015 activity $ $ $ ) $ ) $ ) $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Restructuring reserves included on Condensed Consolidated Balance Sheets | Total Cumulative Remaining (in millions) Transportation Solutions $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Fiscal 2017 Actions | |
Restructuring and Other Charges, Net | |
Net restructuring charges by segment | Total Cumulative Remaining (in millions) Transportation Solutions $ $ $ Industrial Solutions — Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Fiscal 2016 Actions | |
Restructuring and Other Charges, Net | |
Net restructuring charges by segment | Fiscal Year End 2017 2016 (in millions) Accrued and other current liabilities $ $ Other liabilities ​ ​ ​ ​ ​ ​ ​ ​ Restructuring reserves $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Discontinued Operations | |
Income from discontinued operations | Fiscal 2017 2016 2015 (in millions) Net sales from discontinued operations $ — $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-tax income from discontinued operations $ $ $ Pre-tax gain on sale of discontinued operations Income tax (expense) benefit ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from discontinued operations, net of income taxes $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Acquisitions (Tables)
Acquisitions (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
2016 Acquisitions | |
Business acquisition information | |
Allocation of purchase price to the fair value of identifiable assets acquired and liabilities assumed | (in millions) Cash and cash equivalents $ Other current assets Goodwill Intangible assets Other non-current assets ​ ​ ​ ​ ​ Total assets acquired ​ ​ ​ ​ ​ Current liabilities Deferred income taxes Other non-current liabilities ​ ​ ​ ​ ​ Total liabilities assumed ​ ​ ​ ​ ​ Net assets acquired Cash and cash equivalents acquired ) ​ ​ ​ ​ ​ Net cash paid $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Acquired intangible assets | (in millions) Cash and cash equivalents $ Accounts receivable Inventories Other current assets Property, plant, and equipment Goodwill Intangible assets Other non-current assets ​ ​ ​ ​ ​ Total assets acquired ​ ​ ​ ​ ​ Short-term debt Accounts payable Other current liabilities Long-term debt Deferred income taxes Other non-current liabilities ​ ​ ​ ​ ​ Total liabilities assumed ​ ​ ​ ​ ​ Net assets acquired Cash and cash equivalents acquired ) ​ ​ ​ ​ ​ Net cash paid $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Measurement Specialties | |
Business acquisition information | |
Allocation of purchase price to the fair value of identifiable assets acquired and liabilities assumed | Amount Weighted-Average (in millions) (in years) Customer relationships $ Developed technology Trade names and trademarks Customer order backlog ​ ​ ​ ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Acquired intangible assets | Amount Weighted-Average Amortization Period (in millions) (in years) Customer relationships $ Developed technology Trade names and trademarks Customer order backlog < 1 ​ ​ ​ ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Measurement Specialties and 2016 Acquisitions | |
Business acquisition information | |
Pro forma financial information | Pro Forma for Fiscal 2016 2015 (in millions, except Net sales $ $ Net income Diluted earnings per share $ $ |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Inventories | |
Schedule of inventories | Fiscal Year End 2017 2016 (in millions) Raw materials $ $ Work in progress Finished goods Inventoried costs on long-term contracts ​ ​ ​ ​ ​ ​ ​ ​ Inventories $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Property, Plant, and Equipmen37
Property, Plant, and Equipment, Net (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Property, Plant, and Equipment, Net | |
Components of net property, plant, and equipment | Fiscal Year End 2017 2016 (in millions) Land and improvements $ $ Buildings and improvements Machinery and equipment Construction in process ​ ​ ​ ​ ​ ​ ​ ​ Gross property, plant, and equipment Accumulated depreciation ) ) ​ ​ ​ ​ ​ ​ ​ ​ Property, plant, and equipment, net $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Goodwill (Tables)
Goodwill (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Goodwill | |
Changes in the carrying amount of goodwill by segment | Transportation Industrial Communications Total (in millions) Fiscal year end 2015 (1) $ $ $ $ Acquisitions — Divestiture of business — — ) ) Currency translation ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year end 2016 (1) Acquisitions — Currency translation ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal year end 2017 (1) $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) At fiscal year end 2017, 2016, and 2015, accumulated impairment losses for the Transportation Solutions and Industrial Solutions segments were $2,191 million and $669 million, respectively. Accumulated impairment losses for the Communications Solutions segment were $1,514 million at fiscal year end 2017 and 2016 and $1,626 million at fiscal year end 2015. |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Intangible Assets, Net | |
Schedule of finite-lived intangible assets | Fiscal Year End 2017 2016 Gross Accumulated Net Gross Accumulated Net (in millions) Customer relationships $ $ ) $ $ $ ) $ Intellectual property ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ ) $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Schedule of finite-lived intangible assets, future amortization expense | (in millions) Fiscal 2018 $ Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Accrued and Other Current Lia40
Accrued and Other Current Liabilities (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Accrued and Other Current Liabilities | |
Components of accrued and other current liabilities | Fiscal Year End 2017 2016 (in millions) Accrued payroll and employee benefits $ $ Dividends payable to shareholders Income taxes payable Restructuring reserves Interest payable Other ​ ​ ​ ​ ​ ​ ​ ​ Accrued and other current liabilities $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Debt | |
Schedule of debt | Fiscal Year End 2017 2016 (in millions) Commercial paper, at a weighted-average interest rate of 0.69% at fiscal year end 2016 $ — $ 6.55% senior notes due 2017 2.375% senior notes due 2018 2.35% senior notes due 2019 4.875% senior notes due 2021 3.50% senior notes due 2022 1.10% euro-denominated senior notes due 2023 3.45% senior notes due 2024 3.70% senior notes due 2026 3.125% senior notes due 2027 — 7.125% senior notes due 2037 Other ​ ​ ​ ​ ​ ​ ​ ​ Total principal debt Unamortized discounts and debt issuance costs ) ) Effects of fair value hedge-designated interest rate swaps ​ ​ ​ ​ ​ ​ ​ ​ Total debt $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Aggregate amounts of principal payments maturing during the next five years and thereafter | (in millions) Fiscal 2018 $ Fiscal 2019 Fiscal 2020 — Fiscal 2021 Fiscal 2022 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Commitments and Contingencies | |
Schedule of minimum lease payment obligations under non-cancelable operating lease obligations | (in millions) Fiscal 2018 $ Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Thereafter ​ ​ ​ ​ ​ Total $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Financial Instruments and Fai43
Financial Instruments and Fair Value Measurements (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Financial Instruments and Fair Value Measurements | |
Schedule of impacts of hedging program | Fiscal 2017 2016 2015 (in millions) Foreign exchange gains (losses) $ ) $ ) $ |
Retirement Plans (Tables)
Retirement Plans (Tables) - Defined Benefit Pension Plans | 12 Months Ended |
Sep. 29, 2017 | |
Defined benefit plans and other postretirement benefit plans | |
Net periodic pension benefit cost | U.S. Plans Non-U.S. Plans Fiscal Fiscal 2017 2016 2015 2017 2016 2015 ($ in millions) Service cost $ $ $ $ $ $ Interest cost Expected return on plan assets ) ) ) ) ) ) Amortization of net actuarial loss Other — — — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net periodic pension benefit cost $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average assumptions used to determine net pension benefit cost during the fiscal year: Discount rate % % % % % % Expected return on plan assets % % % % % % Rate of compensation increase — % — % — % % % % |
Changes in benefit obligation and plan assets and the net amount recognized on the Consolidated Balance Sheets | U.S. Plans Non-U.S. Plans Fiscal Fiscal 2017 2016 2017 2016 ($ in millions) Change in benefit obligation: Benefit obligation at beginning of fiscal year $ $ $ $ Service cost Interest cost Actuarial loss ) ) Benefits and administrative expenses paid ) ) ) ) Currency translation — — ) Other — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Benefit obligation at end of fiscal year ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change in plan assets: Fair value of plan assets at beginning of fiscal year Actual return on plan assets Employer contributions Benefits and administrative expenses paid ) ) ) ) Currency translation — — ) ) Other — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value of plan assets at end of fiscal year ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Funded status $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Amounts recognized on the Consolidated Balance Sheets: Other assets $ — $ — $ $ — Accrued and other current liabilities ) ) ) ) Long-term pension and postretirement liabilities ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net amount recognized $ ) $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted-average assumptions used to determine pension benefit obligation at fiscal year end: Discount rate % % % % Rate of compensation increase — % — % % % |
Pre-tax amounts recognized in accumulated other comprehensive income (loss) for all U.S. and non-U.S. defined benefit pension plans | U.S. Plans Non-U.S. Plans Fiscal Fiscal 2017 2016 2017 2016 (in millions) Change in net loss: Unrecognized net loss at beginning of fiscal year $ $ $ $ Current year change recorded in accumulated other comprehensive income (loss) ) ) Amortization reclassified to earnings ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrecognized net loss at end of fiscal year $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change in prior service credit: Unrecognized prior service credit at beginning of fiscal year $ — $ — $ ) $ ) Current year change recorded in accumulated other comprehensive income (loss) — ) Amortization reclassified to earnings (1) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Unrecognized prior service credit at end of fiscal year $ $ — $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Amortization of prior service credit is included in other in the above table summarizing the components of net periodic pension benefit cost. |
Target weighted average asset allocation and weighted average asset allocation for U.S. and non-U.S. pension plans | U.S. Plans Non-U.S. Plans Target Fiscal Fiscal Target Fiscal Fiscal Asset category: Equity securities % % % % % % Fixed income Insurance contracts and other investments — — — Real estate investments — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total % % % % % % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Expected future benefit payments | U.S. Plans Non-U.S. Plans (in millions) Fiscal 2018 $ $ Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2023-2027 |
Accumulated benefit obligation, projected benefit obligation, and fair value of plan assets information | U.S. Plans Non-U.S. Plans Fiscal Year End Fiscal Year End 2017 2016 2017 2016 (in millions) Accumulated benefit obligation $ $ $ $ Pension plans with accumulated benefit obligations in excess of plan assets: Accumulated benefit obligation Fair value of plan assets Pension plans with projected benefit obligations in excess of plan assets: Projected benefit obligation Fair value of plan assets |
Defined benefit pension plans' asset categories and associated fair value | Fiscal Year End 2017 U.S. Plans Non-U.S. Plans Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (in millions) Equity: U.S. equity securities (1) $ $ — $ — $ $ — $ — $ — $ — Non-U.S. equity securities (1) — — — — — — Commingled equity funds (2) — — — — — — Fixed income: Government bonds (3) — — — — Corporate bonds (4) — — — — Commingled bond funds (5) — — — — Other (6) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Subtotal $ $ $ — $ — $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Items to reconcile to fair value of plan assets (7) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value of plan assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fiscal Year End 2016 U.S. Plans Non-U.S. Plans Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total (in millions) Equity: U.S. equity securities (1) $ $ — $ — $ $ $ — $ — $ Non-U.S. equity securities (1) — — — — Commingled equity funds (2) — — — — — — Fixed income: Government bonds (3) — — — — Corporate bonds (4) — — — — Commingled bond funds (5) — — — — — — Other (6) — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Subtotal $ $ $ — $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Items to reconcile to fair value of plan assets (7) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value of plan assets $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) U.S. and non-U.S. equity securities are valued at the closing price reported on the stock exchange on which the individual securities are traded. (2) Commingled equity funds are pooled investments in multiple equity-type securities. Fair value is calculated as the closing price of the underlying investments, an observable market condition, divided by the number of shares of the fund outstanding. (3) Government bonds are marked to fair value based on quoted market prices or market approach valuation models using observable market data such as quotes, spreads, and data points for yield curves. (4) Corporate bonds are marked to fair value based on quoted market prices or market approach valuation models using observable market data such as quotes, spreads, and data points for yield curves. (5) Commingled bond funds are pooled investments in multiple debt-type securities. Fair value is calculated as the closing price of the underlying investments, an observable market condition, divided by the number of shares of the fund outstanding. (6) Other investments are composed of insurance contracts, derivatives, short-term investments, structured products such as collateralized obligations and mortgage- and asset-backed securities, real estate investments, and hedge funds. Insurance contracts are valued using cash surrender value, or face value of the contract if a cash surrender value is unavailable (level 2), as these values represent the amount that the plan would receive on termination of the underlying contract. Derivatives, short-term investments, and structured products are marked to fair value using models that are supported by observable market based data (level 2). Real estate investments include investments in commingled real estate funds and are valued at net asset value which is calculated using unobservable inputs that are supported by little or no market activity (level 3). Hedge funds are valued at their net asset value which is calculated using unobservable inputs that are supported by little or no market activity (level 3). (7) Items to reconcile to fair value of plan assets include amounts receivable for securities sold, amounts payable for securities purchased, and any cash balances, considered to be carried at book value, that are held in the plans. |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Income Taxes | |
Significant components of the income tax expense (benefit) | Fiscal 2017 2016 2015 (in millions) Current income tax expense (benefit): U.S.: Federal $ ) $ ) $ ) State ) Non-U.S. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred income tax expense (benefit): U.S.: Federal ) State ) Non-U.S. ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax expense (benefit) $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
U.S. and non-U.S. components of income from continuing operations before income taxes | Fiscal 2017 2016 2015 (in millions) U.S. $ ) $ ) $ ) Non-U.S. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Reconciliation between U.S. federal income taxes at the statutory rate and income tax expense (benefit) on continuing operations | Fiscal 2017 2016 2015 (in millions) Notional U.S. federal income tax expense at the statutory rate $ $ $ Adjustments to reconcile to the income tax expense (benefit): U.S. state income tax expense (benefit), net — ) Other expense—Tax Sharing Agreement (1) Tax law changes ) Tax credits ) ) ) Non-U.S. net earnings (2) ) ) ) Change in accrued income tax liabilities ) ) Valuation allowance ) ) Legal entity restructuring and intercompany transactions ) Divestitures — ) — Excess tax benefits from share-based payments ) — — Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income tax expense (benefit) $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Net other expense pursuant to the Tax Sharing Agreement with Tyco International and Covidien is not taxable or deductible. (2) Excludes items which are separately presented. |
Components of net deferred income tax asset | Fiscal Year End 2017 2016 (in millions) Deferred tax assets: Accrued liabilities and reserves $ $ Tax loss and credit carryforwards Inventories Pension and postretirement benefits Deferred revenue Interest Unrecognized income tax benefits Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred tax liabilities: Intangible assets ) ) Property, plant, and equipment ) ) Other ) ) ​ ​ ​ ​ ​ ​ ​ ​ ) ) ​ ​ ​ ​ ​ ​ ​ ​ Net deferred tax asset before valuation allowance Valuation allowance ) ) ​ ​ ​ ​ ​ ​ ​ ​ Net deferred tax asset $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Tax loss and credit carryforwards | Expiration Period Through Fiscal 2023 No Total (in millions) U.S. Federal: Net operating loss carryforwards $ $ $ — $ Tax credit carryforwards Capital loss carryforwards — — U.S. State: Net operating loss carryforwards. — Tax credit carryforwards Non-U.S.: Net operating loss carryforwards Tax credit carryforwards — Capital loss carryforwards — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total tax loss and credit carryforwards $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Activity of unrecognized income tax benefits | Fiscal 2017 2016 2015 (in millions) Balance at beginning of fiscal year $ $ $ Additions related to prior years tax positions Reductions related to prior years tax positions ) ) ) Additions related to current year tax positions Acquisitions — — Settlements ) ) ) Reductions due to lapse of applicable statute of limitations ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at end of fiscal year $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Tax years subject to examination in major tax jurisdictions | Jurisdiction Open Years China 2007 through 2017 Czech Republic 2014 through 2017 Germany 2013 through 2017 Hong Kong 2011 through 2017 Ireland 2012 through 2017 Italy 2013 through 2017 Japan 2011 through 2017 Korea 2012 through 2017 Luxembourg 2012 through 2017 Netherlands 2012 through 2017 Singapore 2012 through 2017 Spain 2013 through 2017 Switzerland 2012 through 2017 United Kingdom 2015 through 2017 U.S.—federal 2014 through 2017 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Earnings Per Share. | |
Schedule of weighted-average shares outstanding, basic and diluted | Fiscal 2017 2016 2015 (in millions) Basic Dilutive impact of share-based compensation arrangements ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Diluted ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Shareholders' Equity | |
Schedule of dividends and cash distributions to shareholders | Approval Date Annual Payment Per Share Payment Dates March 2014 CHF 1.04 (equivalent to $1.16), payable in four quarterly installments of $0.29 Third quarter of fiscal 2014 March 2015 $1.32 (equivalent to CHF 1.27), payable in four quarterly installments of $0.33 Third quarter of fiscal 2015 March 2016 $1.48 (equivalent to CHF 1.48), payable in four quarterly installments of $0.37 Third quarter of fiscal 2016 March 2017 $1.60 (equivalent to CHF 1.62), payable in four quarterly installments of $0.40 Third quarter of fiscal 2017 |
Schedule of common shares repurchased | Fiscal 2017 2016 2015 (in millions) Number of common shares repurchased Repurchase value $ $ $ |
Accumulated Other Comprehensi48
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Accumulated Other Comprehensive Income (Loss) | |
Components of accumulated other comprehensive income (loss) | Currency (1) Unrecognized Gains (Losses) Accumulated (in millions) Balance at fiscal year end 2014 $ $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive loss before reclassifications ) ) ) ) Amounts reclassified from accumulated other comprehensive income (loss) (2) Income tax benefit — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net other comprehensive income (loss), net of tax ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at fiscal year end 2015 ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive loss before reclassifications ) ) ) ) Amounts reclassified from accumulated other comprehensive income (loss) ) Income tax (expense) benefit — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net other comprehensive income (loss), net of tax ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at fiscal year end 2016 ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other comprehensive income before reclassifications Amounts reclassified from accumulated other comprehensive income (loss) ) ) Income tax expense — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net other comprehensive income, net of tax ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at fiscal year end 2017 $ $ ) $ ) $ ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Includes hedges of net investment foreign exchange gains or losses which offset foreign exchange losses or gains attributable to the translation of the net investments. (2) Represents net currency translation reclassified as a result of the sale of our BNS business. This net loss is included in income from discontinued operations on the Consolidated Statement of Operations. See Note 4 for additional information regarding the divestiture of BNS. |
Share Plans (Tables)
Share Plans (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Share Plans | |
Share-based compensation expense | Fiscal 2017 2016 2015 (in millions) Share-based compensation expense $ $ $ |
Summary of restricted share award activity | Shares Weighted-Average Nonvested at fiscal year end 2016 $ Granted Vested ) Forfeited ) ​ ​ ​ ​ ​ ​ ​ ​ Nonvested at fiscal year end 2017 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Summary of performance share award activity | Shares Weighted-Average Outstanding at fiscal year end 2016 $ Granted Vested ) Forfeited ) ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at fiscal year end 2017 $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Summary of share option award activity. | Shares Weighted-Average Weighted-Average Aggregate (in years) (in millions) Outstanding at fiscal year end 2016 $ Granted Exercised ) Expired ) Forfeited ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Outstanding at fiscal year end 2017 $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Vested and expected to vest at fiscal year end 2017 $ $ Exercisable at fiscal year end 2017 $ $ |
Weighted-average assumptions | Fiscal 2017 2016 2015 Weighted-average grant-date fair value $ $ $ Assumptions: Expected share price volatility % % % Risk free interest rate % % % Expected annual dividend per share $ $ $ Expected life of options (in years) |
Segment and Geographic Data (Ta
Segment and Geographic Data (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Segment and Geographic Data | |
Net sales and operating income by business segment | Net Sales Operating Income Fiscal Fiscal 2017 2016 2015 2017 2016 2015 (in millions) Transportation Solutions $ $ $ $ $ $ Industrial Solutions Communications Solutions (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Includes pre-tax gain of $144 million on the sale of our CPD business during fiscal 2016. |
Depreciation and amortization and capital expenditures by segment | Depreciation and Amortization Capital Expenditures Fiscal Fiscal 2017 2016 2015 2017 2016 2015 (in millions) Transportation Solutions $ $ $ $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ |
Segment assets and a reconciliation of segment assets to total assets | Segment Assets Fiscal Year End 2017 2016 2015 (in millions) Transportation Solutions $ $ $ Industrial Solutions Communications Solutions ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total segment assets (1) Other current assets Other non-current assets ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total assets $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Segment assets are composed of accounts receivable, inventories, and net property, plant, and equipment. |
Net sales and net property, plant, and equipment by geographic region | Net Sales (1) Property, Plant, and Fiscal Fiscal Year End 2017 2016 2015 2017 2016 2015 (in millions) Americas: U.S. $ $ $ $ $ $ Other Americas ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Americas ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Europe/Middle East/Africa: Switzerland Germany Other Europe/Middle East/Africa ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Europe/Middle East/Africa ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Asia–Pacific: China Other Asia–Pacific ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Asia–Pacific ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total $ $ $ $ $ $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Net sales to external customers is attributed to individual countries based on the legal entity that records the sale. |
Quarterly Financial Data (una51
Quarterly Financial Data (unaudited) (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Quarterly Financial Data (unaudited) | |
Schedule of Quarterly Financial Information | Fiscal 2017 2016 First Second Third Fourth First Second (1) Third (2) Fourth (3) (in millions, except per share data) Net sales $ $ $ $ $ $ $ $ Gross margin Acquisition and integration costs Restructuring and other charges (credits), net ) Income from continuing operations Income (loss) from discontinued operations, net of income taxes ) ) — Net income $ $ $ $ $ $ $ $ Basic earnings per share: Income from continuing operations $ $ $ $ $ $ $ $ Net income Diluted earnings per share: Income from continuing operations $ $ $ $ $ $ $ $ Net income (1) Results for the second quarter of fiscal 2016 included a pre-tax gain of $146 million on the sale of our CPD business. (2) Results for the third quarter of fiscal 2016 included a $1,135 million income tax benefit associated with the effective settlement of tax matters for the years 1997 through 2000 which resolved all aspects of the disputed debt matter with the IRS through the year 2007 and the related impact of $604 million to other expense pursuant to the Tax Sharing Agreement with Tyco International and Covidien. In addition, results for the third quarter of fiscal 2016 included a $91 million income tax charge related to an increase to the valuation allowance for certain U.S. deferred tax assets, and an $83 million net income tax benefit related to tax settlements in certain other tax jurisdictions and the related impact of $46 million to other expense pursuant to the Tax Sharing Agreement with Tyco International and Covidien. (3) Results for the fourth quarter of fiscal 2016 included an additional week. See Note 1 for additional information regarding our fiscal year end. |
Tyco Electronics Group S.A. (Ta
Tyco Electronics Group S.A. (Tables) | 12 Months Ended |
Sep. 29, 2017 | |
Tyco Electronics Group S.A. | |
Condensed Consolidating Statement of Operations | Condensed Consolidating Statement of Operations TE TEGSA Other Consolidating Total (in millions) Net sales $ — $ — $ $ — $ Cost of sales — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross margin — — — Selling, general, and administrative expenses, net (1) ) — Research, development, and engineering expenses — — — Acquisition and integration costs — — — Restructuring and other charges, net — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income (loss) ) ) — Interest income — — — Interest expense — ) ) — ) Other expense, net — — ) — ) Equity in net income of subsidiaries — ) — Equity in net income of subsidiaries of discontinued operations — ) — Intercompany interest income (expense), net ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes ) Income tax expense — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations ) Income (loss) from discontinued operations, net of income taxes (2) — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income ) Other comprehensive income ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) TEGSA selling, general and administrative expenses include losses of $1,965 million related to intercompany transactions. These losses are offset by corresponding gains recorded by other subsidiaries. (2) Includes the internal allocation of gains and losses associated with the divestiture of our BNS business. Condensed Consolidating Statement of Operations TE TEGSA Other Consolidating Total (in millions) Net sales $ — $ — $ $ — $ Cost of sales — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross margin — — — Selling, general, and administrative expenses, net (1) — Research, development, and engineering expenses — — — Acquisition and integration costs — — — Restructuring and other charges (credits), net ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income (loss) ) ) — Interest income — — — Interest expense — ) ) — ) Other expense, net — — ) — ) Equity in net income of subsidiaries — ) — Equity in net income of subsidiaries of discontinued operations — ) — Intercompany interest income (expense), net ) ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes ) Income tax benefit — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations ) Income (loss) from discontinued operations, net of income taxes (2) ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income ) Other comprehensive loss ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) TEGSA selling, general, and administrative expenses include losses of $80 million related to intercompany transactions. These losses are offset by corresponding gains recorded by other subsidiaries. (2) Includes the internal allocation of gains and losses associated with the divestiture of our BNS business. Condensed Consolidating Statement of Operations TE TEGSA Other Consolidating Total (in millions) Net sales $ — $ — $ $ — $ Cost of sales — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross margin — — — Selling, general, and administrative expenses, net (1) — Research, development, and engineering expenses — — — Acquisition and integration costs — — — Restructuring and other charges, net — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating income (loss) ) ) — Interest income — — — Interest expense — ) ) — ) Other expense, net — — ) — ) Equity in net income of subsidiaries — ) — Equity in net income of subsidiaries of discontinued operations — ) — Intercompany interest income (expense), net ) — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations before income taxes ) Income tax expense — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Income from continuing operations ) Income from discontinued operations, net of income taxes — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income ) Other comprehensive loss ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Comprehensive income $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) TEGSA selling, general, and administrative expenses include losses of $846 million related to intercompany transactions. These losses are offset by corresponding gains recorded by other subsidiaries. |
Condensed Consolidating Balance Sheet | Condensed Consolidating Balance Sheet TE TEGSA Other Consolidating Total (in millions) Assets Current assets: Cash and cash equivalents $ — $ — $ $ — $ Accounts receivable, net — — — Inventories — — — Intercompany receivables ) — Prepaid expenses and other current assets — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current assets ) Property, plant, and equipment, net — — — Goodwill — — — Intangible assets, net — — — Deferred income taxes — — — Investment in subsidiaries — ) — Intercompany loans receivable — ) — Other assets — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Assets $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities and Shareholders' Equity Current liabilities: Short-term debt $ — $ $ $ — $ Accounts payable — — Accrued and other current liabilities — Deferred revenue — — — Intercompany payables — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current liabilities ) Long-term debt — — Intercompany loans payable — ) — Long-term pension and postretirement liabilities — — — Deferred income taxes — — — Income taxes — — — Other liabilities — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Shareholders' Equity ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities and Shareholders' Equity $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Condensed Consolidating Balance Sheet TE TEGSA Other Consolidating Total (in millions) Assets Current assets: Cash and cash equivalents $ — $ — $ $ — $ Accounts receivable, net — — — Inventories — — — Intercompany receivables ) — Prepaid expenses and other current assets — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current assets ) Property, plant, and equipment, net — — — Goodwill — — — Intangible assets, net — — — Deferred income taxes — — — Investment in subsidiaries — ) — Intercompany loans receivable ) — Other assets — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Assets $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Liabilities and Shareholders' Equity Current liabilities: Short-term debt $ — $ $ $ — $ Accounts payable — — Accrued and other current liabilities — Deferred revenue — — — Intercompany payables — ) — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total current liabilities ) Long-term debt — — Intercompany loans payable — ) — Long-term pension and postretirement liabilities — — — Deferred income taxes — — — Income taxes — — — Other liabilities — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Shareholders' Equity ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Liabilities and Shareholders' Equity $ $ $ $ ) $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Condensed Consolidating Statement of Cash Flows TE TEGSA Other Consolidating Total (in millions) Cash Flows From Operating Activities: Net cash provided by (used in) continuing operating activities (1) $ ) $ $ $ ) $ Net cash used in discontinued operating activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) operating activities ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: Capital expenditures — — ) — ) Proceeds from sale of property, plant, and equipment — — — Acquisition of businesses, net of cash acquired — — ) — ) Proceeds from divestiture of business, net of cash retained by sold business — — — Intercompany distribution receipts (1) — — ) — Change in intercompany loans — ) — — Other — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in investing activities — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: Changes in parent company equity (2) ) — — Net decrease in commercial paper — ) — — ) Proceeds from issuance of debt — — — Proceeds from exercise of share options — — — Repurchase of common shares — — ) — ) Payment of common share dividends to shareholders ) — — ) Intercompany distributions (1) — ) ) — Loan activity with parent — ) — Transfers to discontinued operations — — ) — ) Other — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) continuing financing activities ) ) ) Net cash provided by discontinued financing activities — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) financing activities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of currency translation on cash — — ) — ) Net increase in cash and cash equivalents — — — Cash and cash equivalents at beginning of fiscal year — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents at end of fiscal year $ — $ — $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) During fiscal 2017, other subsidiaries made distributions to TEGSA in the amount of $696 million and TEGSA made distributions to TE Connectivity Ltd. in the amount of $50 million. Cash flows are presented based upon the nature of the distributions. (2) Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity. |
Condensed Consolidating Statement of Cash Flows | Condensed Consolidating Statement of Cash Flows TE TEGSA Other Consolidating Total (in millions) Cash Flows From Operating Activities: Net cash provided by (used in) continuing operating activities (1) $ ) $ $ $ ) $ Net cash used in discontinued operating activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) operating activities ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: Capital expenditures — — ) — ) Proceeds from sale of property, plant, and equipment — — — Acquisition of businesses, net of cash acquired — — ) — ) Proceeds from divestiture of business, net of cash retained by sold business — — — Intercompany distribution receipts (1) — — ) — Change in intercompany loans — ) — — Other — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in investing activities — ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: Changes in parent company equity (2) ) — — Net decrease in commercial paper — ) — — ) Proceeds from issuance of debt — — — Proceeds from exercise of share options — — — Repurchase of common shares — — ) — ) Payment of common share dividends to shareholders ) — — ) Intercompany distributions (1) — ) ) — Loan activity with parent — ) — Transfers to discontinued operations — — ) — ) Other — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) continuing financing activities ) ) ) Net cash provided by discontinued financing activities — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) financing activities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of currency translation on cash — — ) — ) Net increase in cash and cash equivalents — — — Cash and cash equivalents at beginning of fiscal year — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents at end of fiscal year $ — $ — $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) During fiscal 2017, other subsidiaries made distributions to TEGSA in the amount of $696 million and TEGSA made distributions to TE Connectivity Ltd. in the amount of $50 million. Cash flows are presented based upon the nature of the distributions. (2) Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity. Condensed Consolidating Statement of Cash Flows TE TEGSA Other Consolidating Total (in millions) Cash Flows From Operating Activities: Net cash provided by (used in) continuing operating activities (1) $ ) $ $ $ ) $ Net cash used in discontinued operating activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) operating activities ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: Capital expenditures — — ) — ) Proceeds from sale of property, plant, and equipment — — — Acquisition of businesses, net of cash acquired — — ) — ) Proceeds from divestiture of business, net of cash retained by sold business — — Proceeds from divestiture of discontinued operations, net of cash retained by sold operations (2) — ) — ) Intercompany distribution receipts (1) — ) — Change in intercompany loans — ) — — Other — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) investing activities ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: Changes in parent company equity (3) ) — — Net increase in commercial paper — — — Proceeds from issuance of debt — — Repayment of debt — ) ) — ) Proceeds from exercise of share options — — — Repurchase of common shares ) — ) — ) Payment of common share dividends to shareholders ) — — ) Intercompany distributions (1) — ) ) — Loan activity with parent — ) ) — Transfers to discontinued operations — — ) — ) Other — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in continuing financing activities ) ) ) ) Net cash provided by discontinued financing activities — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in financing activities ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of currency translation on cash — — — Net decrease in cash and cash equivalents — — ) — ) Cash and cash equivalents at beginning of fiscal year — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents at end of fiscal year $ — $ — $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) During fiscal 2016, other subsidiaries made distributions to TEGSA in the amount of $1,897 million and TEGSA made distributions to TE Connectivity Ltd. in the amount of $1,250 million. Cash flows are presented based upon the nature of the distributions. (2) Includes the internal allocation of proceeds between TEGSA and other subsidiaries associated with the divestiture of our BNS business. (3) Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity. Condensed Consolidating Statement of Cash Flows TE TEGSA Other Consolidating Total (in millions) Cash Flows From Operating Activities: Net cash provided by continuing operating activities (1) $ $ $ $ ) $ Net cash provided by discontinued operating activities — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by operating activities ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: Capital expenditures — — ) — ) Proceeds from sale of property, plant, and equipment — — — Acquisition of businesses, net of cash acquired — — ) — ) Proceeds from divestiture of discontinued operations, net of cash retained by sold operations — — Change in intercompany loans — ) — — Other — — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) continuing investing activities — ) ) Net cash used in discontinued investing activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash provided by (used in) investing activities — ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: Changes in parent company equity (2) ) — — Net decrease in commercial paper — ) — — ) Proceeds from issuance of debt — — — Repayment of debt — ) ) — ) Proceeds from exercise of share options — — — Repurchase of common shares ) — ) — ) Payment of common share dividends to shareholders ) — — ) Intercompany distributions (1) — ) ) — Loan activity with parent — ) — Transfers from discontinued operations — — — Other — ) ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in continuing financing activities ) ) ) ) Net cash used in discontinued financing activities — — ) — ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net cash used in financing activities ) ) ) ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Effect of currency translation on cash — — ) — ) Net increase (decrease) in cash and cash equivalents — ) — Cash and cash equivalents at beginning of fiscal year — — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents at end of fiscal year $ — $ — $ $ — $ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) During fiscal 2015, other subsidiaries made distributions to TEGSA in the amount of $1,326 million and TEGSA made distributions to TE Connectivity Ltd. in the amount of $1,335 million. Cash flows are presented based upon the nature of the distributions. (2) Changes in parent company equity includes cash flows related to certain intercompany equity and funding transactions, and other intercompany activity. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts (Table) | 12 Months Ended |
Sep. 29, 2017 | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS | Description Balance at Additions Acquisitions, Deductions Balance at (in millions) Fiscal 2017: Allowance for doubtful accounts receivable $ $ $ — $ ) $ Valuation allowance on deferred tax assets — ) Fiscal 2016: Allowance for doubtful accounts receivable $ $ — $ $ ) $ Valuation allowance on deferred tax assets ) Fiscal 2015: Allowance for doubtful accounts receivable $ $ $ $ ) $ Valuation allowance on deferred tax assets ) |
Basis of Presentation (Details)
Basis of Presentation (Details) | 12 Months Ended |
Sep. 29, 2017segment | |
Basis of Presentation | |
Number of reportable segments | 3 |
Summary of Significant Accoun55
Summary of Significant Accounting Policies (Details) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017USD ($)segmentitem | Sep. 30, 2016USD ($) | Sep. 25, 2015USD ($) | |
Summary of Significant Accounting Policies | |||
Percentage of voting shares that triggers consolidation, minimum | 50.00% | ||
Goodwill and Other Intangible Assets | |||
Number of reporting units | 6 | ||
Number of reporting units containing goodwill | 5 | ||
Number of Segments | segment | 3 | ||
Research and Development | |||
Research and development expenditures | $ | $ 595 | $ 566 | $ 540 |
Transportation Solutions | |||
Goodwill and Other Intangible Assets | |||
Number of reporting units | 2 | ||
Industrial Solutions | |||
Goodwill and Other Intangible Assets | |||
Number of reporting units | 2 | ||
Communications Solutions | |||
Goodwill and Other Intangible Assets | |||
Number of reporting units | 2 | ||
Minimum | |||
Goodwill and Other Intangible Assets | |||
Useful life of intangible assets with a determinable life | 1 year | ||
Maximum | |||
Goodwill and Other Intangible Assets | |||
Useful life of intangible assets with a determinable life | 50 years | ||
Land and improvements | Minimum | |||
Property, Plant, and Equipment, Net and Long-Lived Assets | |||
Estimated useful life | 10 years | ||
Land and improvements | Maximum | |||
Property, Plant, and Equipment, Net and Long-Lived Assets | |||
Estimated useful life | 20 years | ||
Buildings and improvements | Minimum | |||
Property, Plant, and Equipment, Net and Long-Lived Assets | |||
Estimated useful life | 5 years | ||
Buildings and improvements | Maximum | |||
Property, Plant, and Equipment, Net and Long-Lived Assets | |||
Estimated useful life | 40 years | ||
Machinery and equipment | Minimum | |||
Property, Plant, and Equipment, Net and Long-Lived Assets | |||
Estimated useful life | 1 year | ||
Machinery and equipment | Maximum | |||
Property, Plant, and Equipment, Net and Long-Lived Assets | |||
Estimated useful life | 15 years |
Summary of Significant Accoun56
Summary of Significant Accounting Policies - Recently Issued Accounting Pronouncements (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 |
Recently Issued Accounting Pronouncements Not Yet Adopted | |||
Accumulated earnings | $ 10,175 | $ 8,682 | |
Assets | 19,403 | $ 17,608 | $ 20,589 |
Accounting Standards Update 2016-16 | |||
Recently Issued Accounting Pronouncements Not Yet Adopted | |||
Accumulated earnings | (120) | ||
Assets | $ (120) |
Summary of Significant Accoun57
Summary of Significant Accounting Policies - Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
Recently Adopted Accounting Pronouncement | ||
Deferred tax assets | $ 2,141 | $ 2,111 |
Accumulated earnings | 10,175 | $ 8,682 |
Accounting Standards Update 2016-09 | ||
Recently Adopted Accounting Pronouncement | ||
Deferred tax assets | 165 | |
Accumulated earnings | $ 165 |
Restructuring and Other Charg58
Restructuring and Other Charges, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 29, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 30, 2016 | Sep. 30, 2016 | Jun. 24, 2016 | Mar. 25, 2016 | Dec. 25, 2015 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Restructuring and other charges, net: | |||||||||||
Restructuring charges, net | $ 147 | $ 125 | $ 93 | ||||||||
Gain on divestiture | (144) | ||||||||||
Other charges, net | 1 | 21 | 59 | ||||||||
Restructuring and other charges, net | $ 23 | $ 19 | $ 59 | $ 47 | $ 30 | $ 31 | $ (99) | $ 40 | 148 | 2 | 152 |
Transportation Solutions | |||||||||||
Restructuring and other charges, net: | |||||||||||
Restructuring charges, net | 67 | 39 | 6 | ||||||||
Industrial Solutions | |||||||||||
Restructuring and other charges, net: | |||||||||||
Restructuring charges, net | 72 | 28 | 29 | ||||||||
Communications Solutions | |||||||||||
Restructuring and other charges, net: | |||||||||||
Restructuring charges, net | $ 8 | $ 58 | $ 58 |
Restructuring and Other Charg59
Restructuring and Other Charges, Net - Actions (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Restructuring Charges | |||
Charges (Credits) Incurred | $ 147 | $ 125 | $ 93 |
Fiscal 2017 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 160 | ||
Charges (Credits) Incurred | 149 | ||
Remaining Expected Charges | 11 | ||
Fiscal 2016 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 155 | ||
Charges (Credits) Incurred | 2 | 130 | |
Remaining Expected Charges | 23 | ||
Fiscal 2015 Actions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | (2) | (1) | 92 |
Pre-Fiscal 2015 Actions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | (2) | (4) | 1 |
Transportation Solutions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | 67 | 39 | 6 |
Transportation Solutions | Fiscal 2017 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 75 | ||
Charges (Credits) Incurred | 72 | ||
Remaining Expected Charges | 3 | ||
Transportation Solutions | Fiscal 2016 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 38 | ||
Remaining Expected Charges | 1 | ||
Industrial Solutions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | 72 | 28 | 29 |
Industrial Solutions | Fiscal 2017 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 77 | ||
Charges (Credits) Incurred | 75 | ||
Remaining Expected Charges | 2 | ||
Industrial Solutions | Fiscal 2016 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 28 | ||
Remaining Expected Charges | 0 | ||
Communications Solutions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | 8 | $ 58 | $ 58 |
Communications Solutions | Fiscal 2017 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 8 | ||
Charges (Credits) Incurred | 2 | ||
Remaining Expected Charges | 6 | ||
Communications Solutions | Fiscal 2016 Actions | |||
Restructuring Charges | |||
Total Expected Charges | 89 | ||
Remaining Expected Charges | 22 | ||
Cumulative Charges Incurred | Fiscal 2016 Actions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | 132 | ||
Cumulative Charges Incurred | Transportation Solutions | Fiscal 2016 Actions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | 37 | ||
Cumulative Charges Incurred | Industrial Solutions | Fiscal 2016 Actions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | 28 | ||
Cumulative Charges Incurred | Communications Solutions | Fiscal 2016 Actions | |||
Restructuring Charges | |||
Charges (Credits) Incurred | $ 67 |
Restructuring and Other Charg60
Restructuring and Other Charges, Net - Restructuring Reserves (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | $ 91 | $ 84 | $ 114 |
Charges | 166 | 135 | 97 |
Changes in Estimate | (19) | (10) | (4) |
Cash Payments | (82) | (79) | (92) |
Non-Cash Items | (9) | (41) | (21) |
Currency Translation and Other | 2 | 2 | (10) |
Restructuring reserve at the end of the period | 149 | 91 | 84 |
Accrued and other current liabilities | 130 | 64 | |
Other liabilities | 19 | 27 | |
Fiscal 2017 Actions | |||
Restructuring reserve | |||
Charges | 154 | ||
Changes in Estimate | (5) | ||
Cash Payments | (41) | ||
Non-Cash Items | (9) | ||
Currency Translation and Other | 5 | ||
Restructuring reserve at the end of the period | 104 | ||
Fiscal 2016 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 54 | ||
Charges | 11 | 130 | |
Changes in Estimate | (9) | ||
Cash Payments | (30) | (35) | |
Non-Cash Items | (41) | ||
Restructuring reserve at the end of the period | 26 | 54 | |
Fiscal 2015 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 13 | 46 | |
Charges | 3 | 92 | |
Changes in Estimate | (2) | (4) | |
Cash Payments | (4) | (32) | (25) |
Non-Cash Items | (21) | ||
Currency Translation and Other | (1) | ||
Restructuring reserve at the end of the period | 6 | 13 | 46 |
Pre-Fiscal 2015 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 24 | 38 | 114 |
Charges | 1 | 2 | 5 |
Changes in Estimate | (3) | (6) | (4) |
Cash Payments | (7) | (12) | (67) |
Currency Translation and Other | (2) | 2 | (10) |
Restructuring reserve at the end of the period | 13 | 24 | 38 |
Employee severance | Fiscal 2017 Actions | |||
Restructuring reserve | |||
Charges | 143 | ||
Changes in Estimate | (5) | ||
Cash Payments | (40) | ||
Currency Translation and Other | 5 | ||
Restructuring reserve at the end of the period | 103 | ||
Employee severance | Fiscal 2016 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 54 | ||
Charges | 8 | 86 | |
Changes in Estimate | (9) | ||
Cash Payments | (27) | (32) | |
Restructuring reserve at the end of the period | 26 | 54 | |
Employee severance | Fiscal 2015 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 13 | 45 | |
Charges | 3 | 68 | |
Changes in Estimate | (2) | (4) | |
Cash Payments | (4) | (31) | (23) |
Currency Translation and Other | (1) | ||
Restructuring reserve at the end of the period | 6 | 13 | 45 |
Employee severance | Pre-Fiscal 2015 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 12 | 24 | 91 |
Charges | 2 | ||
Changes in Estimate | (3) | (6) | (4) |
Cash Payments | (3) | (8) | (54) |
Currency Translation and Other | (2) | 2 | (11) |
Restructuring reserve at the end of the period | 4 | 12 | 24 |
Facility and other exit costs | Fiscal 2017 Actions | |||
Restructuring reserve | |||
Charges | 2 | ||
Cash Payments | (1) | ||
Restructuring reserve at the end of the period | 1 | ||
Facility and other exit costs | Fiscal 2016 Actions | |||
Restructuring reserve | |||
Charges | 3 | 3 | |
Cash Payments | (3) | (3) | |
Facility and other exit costs | Fiscal 2015 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 1 | ||
Charges | 3 | ||
Cash Payments | (1) | (2) | |
Restructuring reserve at the end of the period | 1 | ||
Facility and other exit costs | Pre-Fiscal 2015 Actions | |||
Restructuring reserve | |||
Restructuring reserve at the beginning of the period | 12 | 14 | 23 |
Charges | 1 | 2 | 3 |
Cash Payments | (4) | (4) | (13) |
Currency Translation and Other | 1 | ||
Restructuring reserve at the end of the period | 9 | 12 | 14 |
Property, plant, and equipment | Fiscal 2017 Actions | |||
Restructuring reserve | |||
Charges | 9 | ||
Non-Cash Items | $ (9) | ||
Property, plant, and equipment | Fiscal 2016 Actions | |||
Restructuring reserve | |||
Charges | 41 | ||
Non-Cash Items | $ (41) | ||
Property, plant, and equipment | Fiscal 2015 Actions | |||
Restructuring reserve | |||
Charges | 21 | ||
Non-Cash Items | $ (21) |
Restructuring and Other Charg61
Restructuring and Other Charges, Net - Other Charges (Details ) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 25, 2016 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Gain on Divestiture | ||||
Proceeds from divestiture of business, net of cash retained by sold business | $ 4 | $ 333 | ||
Gain on divestiture | 144 | |||
Divestiture related costs | ||||
Other charges, net | $ 1 | 21 | $ 59 | |
Broadband Network Solutions | Facility and other exit costs | ||||
Divestiture related costs | ||||
Costs associated with the divestiture of businesses | 18 | |||
Broadband Network Solutions | Legal and Professional fees | ||||
Divestiture related costs | ||||
Costs associated with the divestiture of businesses | $ 36 | |||
Circuit Protection Devices | ||||
Gain on Divestiture | ||||
Proceeds from divestiture of business, net of cash retained by sold business | 333 | |||
Gain on divestiture | $ 146 | $ 144 |
Discontinued Operations (Detail
Discontinued Operations (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||
Oct. 31, 2015 | Sep. 29, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 30, 2016 | Jun. 24, 2016 | Mar. 25, 2016 | Dec. 25, 2015 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Divestiture of business | |||||||||||
Net sales from discontinued operations | $ 1,595 | ||||||||||
Pre-tax income from discontinued operations | $ 3 | $ 30 | 118 | ||||||||
Pre-tax gain on sale of discontinued operations | 3 | 29 | 1,105 | ||||||||
Income tax (expense) benefit | 4 | 9 | (41) | ||||||||
Income from discontinued operations, net of income taxes | $ 5 | $ 3 | $ (1) | $ 3 | $ 48 | $ (9) | $ 29 | $ 10 | 68 | 1,182 | |
Net proceeds from divestiture of discontinued operations | (19) | 2,957 | |||||||||
Com-Net | |||||||||||
Divestiture of business | |||||||||||
Loss Contingency, purchase price plus interest and costs | $ 127 | ||||||||||
Loss contingency, amount paid to sellers | 96 | ||||||||||
Loss Contingency Accrual, Provision | $ (30) | $ 127 |
Acquisitions - Assets Acquired
Acquisitions - Assets Acquired (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||
Oct. 31, 2014USD ($)$ / shares | Sep. 29, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 30, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 24, 2016USD ($) | Mar. 25, 2016USD ($) | Dec. 25, 2015USD ($) | Sep. 29, 2017USD ($)item | Sep. 30, 2016USD ($)item$ / shares | Sep. 25, 2015USD ($)item$ / shares | |
Acquisitions | ||||||||||||
Net sales | $ 3,456 | $ 3,367 | $ 3,227 | $ 3,063 | $ 3,332 | $ 3,121 | $ 2,952 | $ 2,833 | $ 13,113 | $ 12,238 | $ 12,233 | |
Operating income | 2,047 | 1,902 | 1,749 | |||||||||
Allocation of the purchase price | ||||||||||||
Goodwill | 96 | 836 | ||||||||||
Short-term debt | $ 710 | 331 | 710 | 331 | ||||||||
Net cash paid | $ 250 | $ 1,336 | $ 1,725 | |||||||||
2017 Acquisitions | ||||||||||||
Acquisitions | ||||||||||||
Number of Businesses Acquired | item | 2 | |||||||||||
Allocation of the purchase price | ||||||||||||
Goodwill | $ 130 | |||||||||||
Net cash paid | $ 250 | |||||||||||
2016 Acquisitions | ||||||||||||
Acquisitions | ||||||||||||
Number of Businesses Acquired | item | 4 | |||||||||||
Net sales | $ 167 | |||||||||||
Operating income | 8 | |||||||||||
Acquisition costs | 10 | |||||||||||
Amortization of fair value adjustments to acquired inventories and customer order backlog | 7 | |||||||||||
Integration costs | 2 | |||||||||||
Allocation of the purchase price | ||||||||||||
Cash and cash equivalents | 77 | 77 | ||||||||||
Other current assets | 97 | 97 | ||||||||||
Goodwill | 802 | |||||||||||
Intangible assets | 530 | 530 | ||||||||||
Other non-current assets | 73 | 73 | ||||||||||
Total assets acquired | 1,579 | 1,579 | ||||||||||
Current liabilities | 46 | 46 | ||||||||||
Deferred income taxes | 100 | 100 | ||||||||||
Other non-current liabilities | 20 | 20 | ||||||||||
Total liabilities assumed | 166 | 166 | ||||||||||
Net assets acquired | 1,413 | 1,413 | ||||||||||
Cash and cash equivalents acquired | (77) | (77) | ||||||||||
Net cash paid | 1,336 | |||||||||||
Goodwill deductible from prior acquisitions | $ 15 | 15 | ||||||||||
Other 2015 Acquisitions | ||||||||||||
Acquisitions | ||||||||||||
Number of Businesses Acquired | item | 3 | |||||||||||
Allocation of the purchase price | ||||||||||||
Net cash paid | $ 241 | |||||||||||
Measurement Specialties | ||||||||||||
Acquisitions | ||||||||||||
Percentage of voting interest acquired | 100.00% | |||||||||||
Per share value of the purchase (in dollars per share) | $ / shares | $ 86 | |||||||||||
Total transaction value | $ 1,700 | |||||||||||
Repayment of debt and accrued interest | 225 | |||||||||||
Net sales | 548 | |||||||||||
Allocation of the purchase price | ||||||||||||
Cash and cash equivalents | 37 | |||||||||||
Accounts receivable | 84 | |||||||||||
Inventories | 110 | |||||||||||
Other current assets | 20 | |||||||||||
Property, plant, and equipment | 95 | |||||||||||
Goodwill | 1,064 | 1,064 | ||||||||||
Intangible assets | 547 | |||||||||||
Other non-current assets | 9 | |||||||||||
Total assets acquired | 1,966 | |||||||||||
Short-term debt | 20 | |||||||||||
Accounts payable | 48 | |||||||||||
Other current liabilities | 67 | |||||||||||
Long-term Debt | 203 | |||||||||||
Deferred income taxes | 98 | |||||||||||
Other non-current liabilities | 9 | |||||||||||
Total liabilities assumed | 445 | |||||||||||
Net assets acquired | 1,521 | |||||||||||
Cash and cash equivalents acquired | (37) | |||||||||||
Net cash paid | 1,484 | |||||||||||
Goodwill deductible from prior acquisitions | $ 23 | |||||||||||
Measurement Specialties and 2016 Acquisitions | ||||||||||||
Pro forma financial information | ||||||||||||
Net sales | 12,471 | 12,613 | ||||||||||
Net income | $ 2,038 | $ 2,448 | ||||||||||
Diluted earnings per share | $ / shares | $ 5.52 | $ 5.96 |
Acquisitions - Intangibles (Det
Acquisitions - Intangibles (Details) - USD ($) $ in Millions | 12 Months Ended | |
Sep. 30, 2016 | Sep. 25, 2015 | |
2016 Acquisitions | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 530 | |
Acquired intangible assets, Weighted-Average Amortization Period | 16 years | |
Measurement Specialties | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 547 | |
Acquired intangible assets, Weighted-Average Amortization Period | 15 years | |
Customer relationships | 2016 Acquisitions | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 300 | |
Acquired intangible assets, Weighted-Average Amortization Period | 18 years | |
Customer relationships | Measurement Specialties | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 370 | |
Acquired intangible assets, Weighted-Average Amortization Period | 18 years | |
Developed technology | 2016 Acquisitions | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 170 | |
Acquired intangible assets, Weighted-Average Amortization Period | 11 years | |
Developed technology | Measurement Specialties | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 161 | |
Acquired intangible assets, Weighted-Average Amortization Period | 9 years | |
Trade names and trademarks | 2016 Acquisitions | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 45 | |
Acquired intangible assets, Weighted-Average Amortization Period | 25 years | |
Trade names and trademarks | Measurement Specialties | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 4 | |
Acquired intangible assets, Weighted-Average Amortization Period | 1 year | |
Customer order backlog | 2016 Acquisitions | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 15 | |
Acquired intangible assets, Weighted-Average Amortization Period | 3 years | |
Customer order backlog | Measurement Specialties | ||
Acquired intangible assets | ||
Acquired intangible assets, fair value amount | $ 12 | |
Customer order backlog | Measurement Specialties | Maximum | ||
Acquired intangible assets | ||
Acquired intangible assets, Weighted-Average Amortization Period | 1 year |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
Inventories | ||
Raw materials | $ 306 | $ 241 |
Work in progress | 580 | 504 |
Finished goods | 810 | 669 |
Inventoried costs on long-term contracts | 117 | 182 |
Inventories | $ 1,813 | $ 1,596 |
Property, Plant, and Equipmen66
Property, Plant, and Equipment, Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Net property, plant, and equipment | |||
Gross property, plant, and equipment | $ 9,580 | $ 8,888 | |
Accumulated depreciation | (6,180) | (5,836) | |
Property, plant, and equipment, net | 3,400 | 3,052 | $ 2,920 |
Depreciation expense | 466 | 436 | $ 463 |
Land and improvements | |||
Net property, plant, and equipment | |||
Gross property, plant, and equipment | 178 | 159 | |
Buildings and improvements | |||
Net property, plant, and equipment | |||
Gross property, plant, and equipment | 1,399 | 1,272 | |
Machinery and equipment | |||
Net property, plant, and equipment | |||
Gross property, plant, and equipment | 7,306 | 6,890 | |
Construction in process | |||
Net property, plant, and equipment | |||
Gross property, plant, and equipment | $ 697 | $ 567 |
Goodwill (Details)
Goodwill (Details) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017USD ($)item | Sep. 30, 2016USD ($)item | Sep. 25, 2015USD ($) | |
Goodwill: | |||
Goodwill, beginning balance | $ 5,492 | $ 4,824 | |
Acquisitions | 96 | 836 | |
Divestiture of business | (117) | ||
Currency translation | 63 | (51) | |
Goodwill, ending balance | 5,651 | 5,492 | $ 4,824 |
Goodwill impairment | 0 | ||
Transportation Solutions | |||
Goodwill: | |||
Goodwill, beginning balance | 1,903 | 1,863 | |
Acquisitions | 82 | 60 | |
Currency translation | 26 | (20) | |
Goodwill, ending balance | 2,011 | 1,903 | 1,863 |
Accumulated impairment losses | 2,191 | 2,191 | 2,191 |
Industrial Solutions | |||
Goodwill: | |||
Goodwill, beginning balance | 3,005 | 2,253 | |
Acquisitions | 14 | 776 | |
Currency translation | 28 | (24) | |
Goodwill, ending balance | 3,047 | 3,005 | 2,253 |
Accumulated impairment losses | 669 | 669 | 669 |
Communications Solutions | |||
Goodwill: | |||
Goodwill, beginning balance | 584 | 708 | |
Divestiture of business | (117) | ||
Currency translation | 9 | (7) | |
Goodwill, ending balance | 593 | 584 | 708 |
Accumulated impairment losses | 1,514 | 1,514 | $ 1,626 |
Circuit Protection Devices | Communications Solutions | |||
Goodwill: | |||
Divestiture of business | (117) | ||
2017 Acquisitions | |||
Goodwill: | |||
Acquisitions | $ 130 | ||
Number of businesses acquired | item | 2 | ||
2016 Acquisitions | |||
Goodwill: | |||
Goodwill, beginning balance | $ 836 | ||
Acquisitions | 802 | ||
Goodwill, ending balance | $ 802 | $ 836 | |
Number of businesses acquired | item | 4 |
Intangible Assets, Net (Details
Intangible Assets, Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | $ 2,732 | $ 2,668 | |
Accumulated Amortization | (891) | (789) | |
Net Carrying Amount | 1,841 | 1,879 | |
Finite-lived intangible assets, amortization expense | 169 | 149 | $ 153 |
Aggregate amortization expense on intangible assets | |||
Fiscal 2,018 | 184 | ||
Fiscal 2,019 | 181 | ||
Fiscal 2,020 | 174 | ||
Fiscal 2,021 | 171 | ||
Fiscal 2,022 | 170 | ||
Thereafter | 961 | ||
Customer relationships | |||
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | 1,433 | 1,332 | |
Accumulated Amortization | (300) | (212) | |
Net Carrying Amount | 1,133 | 1,120 | |
Intellectual property | |||
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | 1,263 | 1,300 | |
Accumulated Amortization | (575) | (563) | |
Net Carrying Amount | 688 | 737 | |
Other | |||
Finite-Lived Intangible Assets | |||
Gross Carrying Amount | 36 | 36 | |
Accumulated Amortization | (16) | (14) | |
Net Carrying Amount | $ 20 | $ 22 |
Accrued and Other Current Lia69
Accrued and Other Current Liabilities (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
Accrued and Other Current Liabilities | ||
Accrued payroll and employee benefits | $ 596 | $ 431 |
Dividends payable to shareholders | 281 | 263 |
Income taxes payable | 121 | 149 |
Restructuring reserves | 130 | 64 |
Interest payable | 58 | 56 |
Other | 440 | 474 |
Accrued and other current liabilities | $ 1,626 | $ 1,437 |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Aug. 31, 2017 | Sep. 30, 2016 |
Debt | |||
Other | $ 96 | $ 3 | |
Total principal debt | 4,356 | 4,061 | |
Unamortized discounts and debt issuance costs | (26) | (26) | |
Effects of fair value hedge-designated interest rate swaps | 14 | 35 | |
Total debt | 4,344 | 4,070 | |
Commercial paper | |||
Debt | |||
Total principal debt | $ 330 | ||
Weighted-average interest rate | 0.69% | ||
6.55% senior notes due 2017 | |||
Debt | |||
Total principal debt | $ 708 | $ 708 | |
Debt instrument, interest rate (as a percent) | 6.55% | 6.55% | |
2.375% senior notes due 2018 | |||
Debt | |||
Total principal debt | $ 325 | $ 325 | |
Debt instrument, interest rate (as a percent) | 2.375% | 2.375% | |
2.35% senior notes due 2019 | |||
Debt | |||
Total principal debt | $ 250 | $ 250 | |
Debt instrument, interest rate (as a percent) | 2.35% | 2.35% | |
4.875% senior notes due 2021 | |||
Debt | |||
Total principal debt | $ 250 | $ 250 | |
Debt instrument, interest rate (as a percent) | 4.875% | 4.875% | |
3.50% senior notes due 2022 | |||
Debt | |||
Total principal debt | $ 500 | $ 500 | |
Debt instrument, interest rate (as a percent) | 3.50% | 3.50% | |
1.10% euro-denominated senior notes due 2023 | |||
Debt | |||
Total principal debt | $ 650 | $ 618 | |
Debt instrument, interest rate (as a percent) | 1.10% | 1.10% | |
3.45% senior notes due 2024 | |||
Debt | |||
Total principal debt | $ 350 | $ 250 | |
Debt instrument, interest rate (as a percent) | 3.45% | 3.45% | 3.45% |
3.70% senior notes due 2026 | |||
Debt | |||
Total principal debt | $ 350 | $ 350 | |
Debt instrument, interest rate (as a percent) | 3.70% | 3.70% | |
3.125% senior notes due 2027 | |||
Debt | |||
Total principal debt | $ 400 | ||
Debt instrument, interest rate (as a percent) | 3.125% | 3.125% | |
7.125% senior notes due 2037 | |||
Debt | |||
Total principal debt | $ 477 | $ 477 | |
Debt instrument, interest rate (as a percent) | 7.125% | 7.125% |
Debt - Narrative (Details)
Debt - Narrative (Details) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017USD ($)item | Aug. 31, 2017USD ($) | Sep. 30, 2016USD ($) | |
Debt | |||
Ownership percentage in TEGSA | 100.00% | 100.00% | 100.00% |
Fair value of debt | $ 4,622 | $ 4,424 | |
3.125% senior notes due 2027 | |||
Debt | |||
Debt instrument principal amount | $ 400 | ||
Debt instrument, interest rate (as a percent) | 3.125% | 3.125% | |
3.45% senior notes due 2024 | |||
Debt | |||
Debt instrument principal amount | $ 100 | ||
Debt instrument, interest rate (as a percent) | 3.45% | 3.45% | 3.45% |
Five-year credit facility | |||
Debt | |||
Revolving credit facility term | 5 years | ||
Maximum borrowing capacity | $ 1,500 | ||
Borrowings under the Credit Facility | $ 0 | $ 0 | |
Number of Consecutive Fiscal Quarters | item | 4 | ||
Consolidated Total Debt to Consolidated EBITDA ratio, Maximum | 3.75 to 1.0 | ||
Five-year credit facility | Minimum | |||
Debt | |||
Annual facility fee, basis points (as a percent) | 0.05% | ||
Five-year credit facility | Maximum | |||
Debt | |||
Annual facility fee, basis points (as a percent) | 0.125% | ||
Five-year credit facility | LIBOR | |||
Debt | |||
Debt instrument description of variable rate basis | LIBOR plus margin based on debt rating | ||
Five-year credit facility | Bank of America Base Rate | |||
Debt | |||
Debt instrument description of variable rate basis | Bank of America base rate plus margin based on debt rating | ||
Five-year credit facility | Federal funds effective rate | |||
Debt | |||
Debt instrument description of variable rate basis | federal funds effective rate plus margin based on debt rating | ||
Debt instrument basis spread on variable rate (as a percent) | 0.50% | ||
Five-year credit facility | One-Month LIBOR | |||
Debt | |||
Debt instrument description of variable rate basis | one-month LIBOR plus margin based on debt rating | ||
Debt instrument basis spread on variable rate (as a percent) | 1.00% |
Debt - Principal Payments Sched
Debt - Principal Payments Schedule (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
Aggregate amounts of principal payments maturing during the next five years and thereafter | ||
Fiscal 2,018 | $ 710 | |
Fiscal 2,019 | 580 | |
Fiscal 2,020 | 0 | |
Fiscal 2,021 | 250 | |
Fiscal 2,022 | 500 | |
Thereafter | 2,316 | |
Total principal payments | $ 4,356 | $ 4,061 |
Commitments and Contingencies73
Commitments and Contingencies (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Loss Contingencies | |||
Accrual environmental loss contingency, estimate of probable loss | $ 19 | ||
Guarantees and Product Warranties | |||
Accrued warranty claims | $ 50 | $ 48 | |
Liabilities sharing percent, entity | 31.00% | ||
Liabilities sharing percent, Tyco International | 27.00% | ||
Liabilities sharing percent, Covidien | 42.00% | ||
Lease payment obligations | |||
Facility, land, vehicle, and equipment lease rental expense | $ 153 | $ 143 | $ 141 |
Fiscal 2,018 | 110 | ||
Fiscal 2,019 | 85 | ||
Fiscal 2,020 | 62 | ||
Fiscal 2,021 | 51 | ||
Fiscal 2,022 | 42 | ||
Thereafter | 104 | ||
Non-cancelable lease obligations, total | 454 | ||
Minimum | |||
Loss Contingencies | |||
Accrual environmental loss contingency, estimate of probable loss | 15 | ||
Maximum | |||
Loss Contingencies | |||
Accrual environmental loss contingency, estimate of probable loss | 43 | ||
Outstanding Letters of Credit, Letters of Guarantee, and Surety Bonds | |||
Guarantees and Product Warranties | |||
Guarantor obligations, maximum exposure | $ 298 |
Financial Instruments and Fai74
Financial Instruments and Fair Value Measurements (Details) € in Millions, $ in Millions | 12 Months Ended | |||
Sep. 29, 2017USD ($) | Sep. 30, 2016USD ($) | Sep. 25, 2015USD ($) | Sep. 25, 2015EUR (€) | |
Net investment hedges | ||||
Financial Instruments and Fair Value Measurements | ||||
Notional amount of non derivative instruments | $ 3,110 | $ 3,480 | ||
Foreign exchange gains (losses) recorded as currency translation | $ (74) | (45) | $ 353 | |
Cash flow hedges | Cross Currency Interest Rate Contract | ||||
Financial Instruments and Fair Value Measurements | ||||
Notional amount | € | € 1,000 | |||
Quarterly interest payments in euro, fixed interest rate | 3.50% | |||
Interest received in U.S. dollars, average fixed interest rate | 5.33% | |||
Cash flow hedges | Foreign currency contracts | ||||
Financial Instruments and Fair Value Measurements | ||||
Period over which all of the balance in accumulated other comprehensive income (loss) will be reclassified into the Condensed Consolidated Statement of Operations | 12 months | |||
Cash flow hedges | Commodity derivative instruments | ||||
Financial Instruments and Fair Value Measurements | ||||
Period over which all of the balance in accumulated other comprehensive income (loss) will be reclassified into the Condensed Consolidated Statement of Operations | 12 months | |||
Notional amount | $ 314 | $ 232 |
Retirement Plans - Defined Bene
Retirement Plans - Defined Benefit Pension Plan Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
U.S. Plans | |||
Defined Benefit Plan, Net Periodic Pension Benefit Cost | |||
Service cost | $ 12 | $ 9 | $ 9 |
Interest cost | 43 | 50 | 48 |
Expected return on plan assets | (53) | (59) | (67) |
Amortization of net actuarial loss | 40 | 40 | 25 |
Net periodic pension benefit cost | $ 42 | $ 40 | $ 15 |
Weighted average assumptions used to determine net pension benefit cost during the fiscal year: | |||
Discount rate (as a percent) | 3.58% | 4.38% | 4.34% |
Expected return on plan assets (as a percent) | 5.93% | 6.97% | 7.20% |
Non-U.S. Plans | |||
Defined Benefit Plan, Net Periodic Pension Benefit Cost | |||
Service cost | $ 50 | $ 48 | $ 45 |
Interest cost | 35 | 52 | 58 |
Expected return on plan assets | (68) | (68) | (72) |
Amortization of net actuarial loss | 41 | 36 | 33 |
Other | (4) | (6) | (5) |
Net periodic pension benefit cost | $ 54 | $ 62 | $ 59 |
Weighted average assumptions used to determine net pension benefit cost during the fiscal year: | |||
Discount rate (as a percent) | 1.44% | 2.50% | 2.77% |
Expected return on plan assets (as a percent) | 5.21% | 5.98% | 6.46% |
Rate of compensation increase (as a percent) | 2.52% | 2.81% | 2.86% |
Retirement Plans - Change in Be
Retirement Plans - Change in Benefit Obligations and Plan Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Amounts recognized on the Consolidated Balance Sheets: | |||
Other assets | $ 444 | $ 299 | |
Long-term pension and postretirement liabilities | (1,160) | (1,502) | |
U.S. Plans | |||
Change in benefit obligation: | |||
Benefit obligation at beginning of fiscal year | 1,250 | 1,170 | |
Service cost | 12 | 9 | $ 9 |
Interest cost | 43 | 50 | 48 |
Actuarial loss | (34) | 102 | |
Benefits and administrative expenses paid | (82) | (81) | |
Other | 2 | ||
Benefit obligation at end of fiscal year | 1,191 | 1,250 | 1,170 |
Change in plan assets: | |||
Fair value of plan assets at beginning of fiscal year | 929 | 879 | |
Actual return on plan assets | 115 | 130 | |
Employer contributions | 1 | 1 | |
Benefits and administrative expenses paid | (82) | (81) | |
Fair value of plan assets at end of fiscal year | 963 | 929 | 879 |
Funded status | (228) | (321) | |
Amounts recognized on the Consolidated Balance Sheets: | |||
Accrued and other current liabilities | (5) | (5) | |
Long-term pension and postretirement liabilities | (223) | (316) | |
Net amount recognized | $ (228) | $ (321) | |
Weighted-average assumptions used to determine pension benefit obligation at fiscal year end: | |||
Discount rate (as a percent) | 3.77% | 3.58% | |
Non-U.S. Plans | |||
Change in benefit obligation: | |||
Benefit obligation at beginning of fiscal year | $ 2,535 | $ 2,188 | |
Service cost | 50 | 48 | 45 |
Interest cost | 35 | 52 | 58 |
Actuarial loss | (301) | 368 | |
Benefits and administrative expenses paid | (69) | (85) | |
Currency translation | 29 | (63) | |
Other | 13 | 27 | |
Benefit obligation at end of fiscal year | 2,292 | 2,535 | 2,188 |
Change in plan assets: | |||
Fair value of plan assets at beginning of fiscal year | 1,371 | 1,167 | |
Actual return on plan assets | 49 | 261 | |
Employer contributions | 47 | 66 | |
Benefits and administrative expenses paid | (69) | (85) | |
Currency translation | (2) | (59) | |
Other | 6 | 21 | |
Fair value of plan assets at end of fiscal year | 1,402 | 1,371 | $ 1,167 |
Funded status | (890) | (1,164) | |
Amounts recognized on the Consolidated Balance Sheets: | |||
Other assets | 50 | ||
Accrued and other current liabilities | (22) | (20) | |
Long-term pension and postretirement liabilities | (918) | (1,144) | |
Net amount recognized | $ (890) | $ (1,164) | |
Weighted-average assumptions used to determine pension benefit obligation at fiscal year end: | |||
Discount rate (as a percent) | 1.87% | 1.44% | |
Rate of compensation increase (as a percent) | 2.53% | 2.52% |
Retirement Plans - Pre-Tax in A
Retirement Plans - Pre-Tax in AOCI for Defined Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | |
Sep. 29, 2017 | Sep. 30, 2016 | |
U.S. Plans | ||
Change in net loss: | ||
Unrecognized net loss at beginning of fiscal year | $ 428 | $ 436 |
Current year change recorded in accumulated other comprehensive income (loss) | (96) | 32 |
Amortization reclassified to earnings | (40) | (40) |
Unrecognized net loss at end of fiscal year | 292 | 428 |
Change in prior service credit: | ||
Current year change recorded in accumulated other comprehensive income (loss) | 2 | |
Unrecognized prior service credit at end of fiscal year | 2 | |
Estimated amortization of actuarial losses from accumulated other comprehensive income into net periodic pension benefit cost in next fiscal year | ||
Amortization of net actuarial loss | 22 | |
Non-U.S. Plans | ||
Change in net loss: | ||
Unrecognized net loss at beginning of fiscal year | 839 | 711 |
Current year change recorded in accumulated other comprehensive income (loss) | (285) | 164 |
Amortization reclassified to earnings | (41) | (36) |
Unrecognized net loss at end of fiscal year | 513 | 839 |
Change in prior service credit: | ||
Unrecognized prior service credit at beginning of fiscal year | (70) | (66) |
Current year change recorded in accumulated other comprehensive income (loss) | 5 | (10) |
Amortization reclassified to earnings | 6 | 6 |
Unrecognized prior service credit at end of fiscal year | (59) | $ (70) |
Estimated amortization of actuarial losses from accumulated other comprehensive income into net periodic pension benefit cost in next fiscal year | ||
Amortization of net actuarial loss | 24 | |
Amortization of prior service credit | $ 6 |
Retirement Plans - Weighted Ave
Retirement Plans - Weighted Average Allocations (Details) | 12 Months Ended | |
Sep. 29, 2017 | Sep. 30, 2016 | |
U.S. Plans | ||
Target asset allocation | ||
Target asset allocation funded status minimum (as a percent) | 105.00% | |
Target weighted average asset allocations (as a percent) | 100.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 100.00% | 100.00% |
U.S. Plans | Equity securities | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 45.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 50.00% | 45.00% |
U.S. Plans | Fixed income | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 55.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 50.00% | 55.00% |
Non-U.S. Plans | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 100.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 100.00% | 100.00% |
Non-U.S. Plans | Equity securities | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 27.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 30.00% | 41.00% |
Non-U.S. Plans | Fixed income | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 52.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 49.00% | 33.00% |
Non-U.S. Plans | Insurance contracts and other investments | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 19.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 19.00% | 24.00% |
Non-U.S. Plans | Real estate investments | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 2.00% | |
Weighted average asset allocations | ||
Total weighted average asset allocations (as a percent) | 2.00% | 2.00% |
Long-term Target Asset Allocation | U.S. Plans | Equity securities | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 10.00% | |
Long-term Target Asset Allocation | U.S. Plans | Fixed income | ||
Target asset allocation | ||
Target weighted average asset allocations (as a percent) | 90.00% |
Retirement Plans - Future Benef
Retirement Plans - Future Benefit Payments (Details) $ in Millions | Sep. 29, 2017USD ($) |
U.S. Plans | |
Defined Benefit Plan Disclosure | |
Minimum required contributions to pension plans in fiscal 2018 | $ 6 |
Minimum required contributions and expected benefit payments | |
Expected benefit payments, fiscal 2018 | 75 |
Expected benefit payments, fiscal 2019 | 71 |
Expected benefit payments, fiscal 2020 | 72 |
Expected benefit payments, fiscal 2021 | 73 |
Expected benefit payments, fiscal 2022 | 74 |
Expected benefit payments, fiscal 2023-2027 | 371 |
Non-U.S. Plans | |
Defined Benefit Plan Disclosure | |
Minimum required contributions to pension plans in fiscal 2018 | 56 |
Minimum required contributions and expected benefit payments | |
Expected benefit payments, fiscal 2018 | 71 |
Expected benefit payments, fiscal 2019 | 76 |
Expected benefit payments, fiscal 2020 | 77 |
Expected benefit payments, fiscal 2021 | 79 |
Expected benefit payments, fiscal 2022 | 85 |
Expected benefit payments, fiscal 2023-2027 | $ 485 |
Retirement Plans - U.S. and Non
Retirement Plans - U.S. and Non U.S. Pension Plans (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
U.S. Plans | ||
Defined Benefit Plan Disclosure | ||
Accumulated benefit obligation | $ 1,191 | $ 1,250 |
Pension plans with accumulated benefit obligations in excess of plan assets: | ||
Accumulated benefit obligation | 1,191 | 1,250 |
Fair value of plan assets | 963 | 929 |
Pension plans with projected benefit obligations in excess of plan assets: | ||
Projected benefit obligation | 1,191 | 1,250 |
Fair value of plan assets | 963 | 929 |
Non-U.S. Plans | ||
Defined Benefit Plan Disclosure | ||
Accumulated benefit obligation | 2,167 | 2,389 |
Pension plans with accumulated benefit obligations in excess of plan assets: | ||
Accumulated benefit obligation | 1,402 | 2,380 |
Fair value of plan assets | 581 | 1,361 |
Pension plans with projected benefit obligations in excess of plan assets: | ||
Projected benefit obligation | 1,524 | 2,534 |
Fair value of plan assets | $ 583 | $ 1,371 |
Retirement Plans - Defined Be81
Retirement Plans - Defined Benefit Pension Plan Asset Categories and Fair Value Hierarchy (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 |
U.S. Plans | |||
Summary of asset fair value | |||
Fair value of plan assets | $ 963 | $ 929 | $ 879 |
U.S. Plans | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 963 | 929 | |
U.S. Plans | U.S. equity securities | Level 1 | |||
Summary of asset fair value | |||
Fair value of plan assets | 250 | 248 | |
U.S. Plans | U.S. equity securities | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 250 | 248 | |
U.S. Plans | Non-U.S. equity securities | Level 1 | |||
Summary of asset fair value | |||
Fair value of plan assets | 227 | 190 | |
U.S. Plans | Non-U.S. equity securities | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 227 | 190 | |
U.S. Plans | Government bonds | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 59 | 67 | |
U.S. Plans | Government bonds | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 59 | 67 | |
U.S. Plans | Corporate bonds | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 351 | 397 | |
U.S. Plans | Corporate bonds | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 351 | 397 | |
U.S. Plans | Commingled bond funds | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 48 | ||
U.S. Plans | Commingled bond funds | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 48 | ||
U.S. Plans | Other | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 16 | 11 | |
U.S. Plans | Other | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 16 | 11 | |
U.S. Plans | Subtotal | Level 1 | |||
Summary of asset fair value | |||
Fair value of plan assets | 477 | 438 | |
U.S. Plans | Subtotal | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 474 | 475 | |
U.S. Plans | Subtotal | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 951 | 913 | |
U.S. Plans | Items to reconcile to fair value of plan assets | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 12 | 16 | |
Non-U.S. Plans | |||
Summary of asset fair value | |||
Fair value of plan assets | 1,402 | 1,371 | $ 1,167 |
Non-U.S. Plans | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 1,402 | 1,371 | |
Non-U.S. Plans | U.S. equity securities | Level 1 | |||
Summary of asset fair value | |||
Fair value of plan assets | 64 | ||
Non-U.S. Plans | U.S. equity securities | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 64 | ||
Non-U.S. Plans | Non-U.S. equity securities | Level 1 | |||
Summary of asset fair value | |||
Fair value of plan assets | 62 | ||
Non-U.S. Plans | Non-U.S. equity securities | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 62 | ||
Non-U.S. Plans | Commingled equity funds | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 418 | 456 | |
Non-U.S. Plans | Commingled equity funds | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 418 | 456 | |
Non-U.S. Plans | Government bonds | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 219 | 226 | |
Non-U.S. Plans | Government bonds | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 219 | 226 | |
Non-U.S. Plans | Corporate bonds | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 8 | 13 | |
Non-U.S. Plans | Corporate bonds | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 8 | 13 | |
Non-U.S. Plans | Commingled bond funds | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 455 | 262 | |
Non-U.S. Plans | Commingled bond funds | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 455 | 262 | |
Non-U.S. Plans | Other | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 180 | 177 | |
Non-U.S. Plans | Other | Level 3 | |||
Summary of asset fair value | |||
Fair value of plan assets | 117 | 91 | |
Non-U.S. Plans | Other | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 297 | 268 | |
Non-U.S. Plans | Subtotal | Level 1 | |||
Summary of asset fair value | |||
Fair value of plan assets | 126 | ||
Non-U.S. Plans | Subtotal | Level 2 | |||
Summary of asset fair value | |||
Fair value of plan assets | 1,280 | 1,134 | |
Non-U.S. Plans | Subtotal | Level 3 | |||
Summary of asset fair value | |||
Fair value of plan assets | 117 | 91 | |
Non-U.S. Plans | Subtotal | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | 1,397 | 1,351 | |
Non-U.S. Plans | Items to reconcile to fair value of plan assets | Fair Value | |||
Summary of asset fair value | |||
Fair value of plan assets | $ 5 | $ 20 |
Retirement Plans - Defined Cont
Retirement Plans - Defined Contribution and Postretirement Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Defined Contribution Retirement Plans | |||
Expense for the defined contribution plans | $ 68 | $ 59 | $ 60 |
Deferred Compensation Plans | |||
Total deferred compensation liabilities | 157 | 132 | |
Postretirement Benefit Plans | |||
Change in benefit obligation: | |||
Benefit obligation | $ 20 | $ 45 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense (Benefit) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Current income tax expense (benefit): | |||
U.S: Federal | $ (2) | $ (1,115) | $ (67) |
U.S: State | 9 | (163) | 12 |
Non-U.S | 323 | 321 | 352 |
Current income tax expense (benefit) | 330 | (957) | 297 |
Deferred income tax expense (benefit): | |||
U.S: Federal | (58) | 173 | 87 |
U.S: State | (9) | 20 | 5 |
Non-U.S | (8) | (15) | (52) |
Deferred income tax expense (benefit) | (75) | 178 | 40 |
Income tax expense (benefit) | $ 255 | $ (779) | $ 337 |
Income Taxes - U.S. and Non U.S
Income Taxes - U.S. and Non U.S. Components (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
U.S. and non-U.S. components of income from continuing operations before income taxes | |||
U.S | $ (75) | $ (115) | $ (31) |
Non-U.S | 2,003 | 1,277 | 1,606 |
Income from continuing operations before income taxes | $ 1,928 | $ 1,162 | $ 1,575 |
Income Taxes - Recon between U.
Income Taxes - Recon between U.S. Federal Taxes and Statutory Rate (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Reconciliation between U.S. federal income taxes at the statutory rate and income tax expense (benefit) on continuing operations | |||
Notional U.S. federal income tax expense at the statutory rate | $ 675 | $ 407 | $ 551 |
U.S. state income tax expense (benefit), net | (93) | 11 | |
Other expense-Tax Sharing Agreement | 3 | 221 | 18 |
Tax law changes | 7 | (3) | 10 |
Tax credits | (9) | (10) | (9) |
Non-U.S. net earnings | (355) | (342) | (275) |
Change in accrued income tax liabilities | 24 | (1,056) | (183) |
Valuation allowance | (1) | 97 | (3) |
Legal entity restructuring and intercompany transactions | (40) | 39 | 211 |
Divestitures | (31) | ||
Excess tax benefits from share-based payments | (40) | ||
Other | (9) | (8) | 6 |
Income tax expense (benefit) | $ 255 | $ (779) | $ 337 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Asset and Liabilities (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
Deferred tax assets: | ||
Accrued liabilities and reserves | $ 356 | $ 286 |
Tax loss and credit carryforwards | 5,265 | 4,656 |
Inventories | 48 | 46 |
Pension and postretirement benefits | 231 | 349 |
Deferred revenue | 8 | 11 |
Interest | 366 | 470 |
Unrecognized income tax benefits | 10 | 10 |
Other | 22 | 32 |
Total Deferred tax assets, Gross | 6,306 | 5,860 |
Deferred tax liabilities: | ||
Intangible assets | (653) | (761) |
Property, plant, and equipment | (22) | (15) |
Other | (99) | (84) |
Total Deferred tax liabilities, Gross | (774) | (860) |
Net deferred tax asset before valuation allowance | 5,532 | 5,000 |
Valuation allowance | (3,627) | (3,096) |
Net deferred tax asset | $ 1,905 | $ 1,904 |
Income Taxes - Tax Loss and Cre
Income Taxes - Tax Loss and Credit Carryforwards (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 |
Tax loss and credit carryforward | ||
Total tax loss and credit carryforwards | $ 5,265 | $ 4,656 |
U.S. Federal | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 1,314 | |
Tax credit carryforwards | 200 | |
Capital loss carryforwards | 10 | |
U.S. State | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 101 | |
Tax credit carryforwards | 31 | |
Non-U.S. | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 3,577 | |
Tax credit carryforwards | 3 | |
Capital loss carryforwards | 29 | |
Through Fiscal 2022 | ||
Tax loss and credit carryforward | ||
Total tax loss and credit carryforwards | 249 | |
Through Fiscal 2022 | U.S. Federal | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 143 | |
Tax credit carryforwards | 24 | |
Capital loss carryforwards | 10 | |
Through Fiscal 2022 | U.S. State | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 52 | |
Tax credit carryforwards | 9 | |
Through Fiscal 2022 | Non-U.S. | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 11 | |
Fiscal 2023 Through Fiscal 2037 | ||
Tax loss and credit carryforward | ||
Total tax loss and credit carryforwards | 2,353 | |
Fiscal 2023 Through Fiscal 2037 | U.S. Federal | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 1,171 | |
Tax credit carryforwards | 119 | |
Fiscal 2023 Through Fiscal 2037 | U.S. State | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 49 | |
Tax credit carryforwards | 15 | |
Fiscal 2023 Through Fiscal 2037 | Non-U.S. | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 998 | |
Tax credit carryforwards | 1 | |
No Expiration | ||
Tax loss and credit carryforward | ||
Total tax loss and credit carryforwards | 2,663 | |
No Expiration | U.S. Federal | ||
Tax loss and credit carryforward | ||
Tax credit carryforwards | 57 | |
No Expiration | U.S. State | ||
Tax loss and credit carryforward | ||
Tax credit carryforwards | 7 | |
No Expiration | Non-U.S. | ||
Tax loss and credit carryforward | ||
Net operating loss carryforwards | 2,568 | |
Tax credit carryforwards | 2 | |
Capital loss carryforwards | $ 29 |
Income Taxes - Valuation Allowa
Income Taxes - Valuation Allowance and Various Income Tax Items (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Jun. 24, 2016 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Valuation allowance | ||||
Valuation allowance | $ 3,627 | $ 3,096 | ||
Current Period Increase in Carryforwards due to the Write-Down of Investments | 709 | |||
Increase (decrease) to the valuation allowance | (1) | 97 | $ (3) | |
Income Taxes | ||||
Income tax benefit associated with intercompany transactions and the corresponding reduction in the valuation allowance for U.S. tax loss carryforwards | 52 | |||
Income tax benefit associated with pre-separation tax matters | 14 | |||
Income tax benefit associated with settlement of certain U.S. pre-separation tax matters | $ 1,135 | 1,135 | 264 | |
Net income tax benefit related to tax settlements in certain other jurisdictions | 83 | 83 | ||
Income tax charges associated with intercompany legal entity restructurings | 216 | |||
Income tax charges associated with intercompany dividends related to the restructuring and sale of BNS | $ 29 | |||
Cumulative undistributed earnings | 22,000 | |||
Cash, cash equivalents and intercompany deposits available to distribute but considered to be permanently reinvested | 6,300 | |||
Estimated income tax expense if intention to permanently reinvest changes | 1,200 | |||
Certain U.S. Deferred Tax Assets | ||||
Valuation allowance | ||||
Increase (decrease) to the valuation allowance | $ 91 | $ 91 | ||
Accounting Standards Update 2016-09 | ||||
Valuation allowance | ||||
Increase (decrease) to the valuation allowance | (165) | |||
Income Taxes | ||||
Income tax benefit related to share-based payments and adoption of ASU 2016-09 | $ 40 |
Income Taxes - Unrecognized Inc
Income Taxes - Unrecognized Income Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Activity related to the Company's unrecognized income tax benefits | |||
Balance at beginning of fiscal year | $ 490 | $ 1,368 | $ 1,595 |
Additions related to prior years tax positions | 40 | 75 | 24 |
Reductions related to prior years tax positions | (9) | (817) | (291) |
Additions related to current year tax positions | 70 | 124 | 97 |
Acquisitions | 4 | ||
Settlements | (4) | (205) | (29) |
Reductions due to lapse of applicable statute of limitations | (86) | (59) | (28) |
Balance at end of fiscal year | 501 | 490 | 1,368 |
Unrecognized income tax benefits that would impact income tax provision and effective tax rate | 431 | 370 | |
Accrued interest and penalties related to uncertain tax positions | 60 | 54 | |
Income tax expense (benefits) related to interest and penalties | (5) | $ (765) | $ 7 |
Unrecognized income tax benefits, approximate amount that could be resolved in next twelve months | $ 40 |
Income Taxes - Statutes of limi
Income Taxes - Statutes of limitations (Details) | 12 Months Ended |
Sep. 29, 2017 | |
Minimum | |
Income Taxes | |
Statutes of limitations, income tax returns filed by the Company, state and local | 3 years |
Statutes of limitations, income tax returns filed by non-U.S. subsidiaries | 3 years |
Maximum | |
Income Taxes | |
Statutes of limitations, income tax returns filed by the Company, state and local | 4 years |
Statutes of limitations, income tax returns filed by non-U.S. subsidiaries | 10 years |
Income Taxes - IRS Audits (Deta
Income Taxes - IRS Audits (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |
Jun. 24, 2016 | Sep. 30, 2016 | Sep. 25, 2015 | |
Income Taxes | |||
Income tax benefit associated with settlement of certain U.S. pre-separation tax matters | $ 1,135 | $ 1,135 | $ 264 |
Other nonoperating expense, settlement of certain U.S. tax matters | $ 604 | 604 | 84 |
Audits of tax matters for the years 1997 through 2000 | |||
Income Taxes | |||
Income tax benefit associated with settlement of certain U.S. pre-separation tax matters | 1,135 | ||
Other nonoperating expense, settlement of certain U.S. tax matters | 604 | ||
Payment to IRS for pre-separation U.S. tax matters | 443 | ||
Net indemnification reimbursements related to pre-separation tax matters | $ 303 | ||
Audits of tax matters for the years 2001 through 2007 | |||
Income Taxes | |||
Income tax benefit associated with settlement of certain U.S. pre-separation tax matters | 201 | ||
Other nonoperating expense, settlement of certain U.S. tax matters | 84 | ||
Audits of tax matters for the years 2008 through 2010 | |||
Income Taxes | |||
Income tax benefit associated with settlement of certain U.S. pre-separation tax matters | $ 63 |
Other Expense, Net (Details)
Other Expense, Net (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Jun. 24, 2016 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Other Expense, Net | ||||
Other expense, net | $ 9 | $ 632 | $ 55 | |
Other nonoperating expense, settlement of certain U.S. tax matters | $ 604 | 604 | $ 84 | |
Other nonoperating expense, tax settlement in another jurisdiction | $ 46 | $ 46 |
Earnings Per Share (Details)
Earnings Per Share (Details) - shares shares in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Earnings Per Share. | |||
Basic (in shares) | 355 | 366 | 405 |
Dilutive impact of share-based compensation arrangements (in shares) | 3 | 3 | 6 |
Diluted (in shares) | 358 | 369 | 411 |
Share options | |||
Antidilutive shares excluded from computation of earnings per share | |||
Antidilutive share options | 1 | 3 | 1 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) SFr / shares in Units, $ / shares in Units, SFr in Millions, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||||||||
Mar. 31, 2017installmentSFr / shares | Mar. 31, 2017installment$ / shares | Mar. 31, 2016installmentSFr / shares | Mar. 31, 2016installment$ / shares | Mar. 31, 2015installmentSFr / shares | Mar. 31, 2015installment$ / shares | Mar. 31, 2014installmentSFr / shares | Mar. 31, 2014installment$ / shares | Sep. 29, 2017CHF (SFr)$ / sharesshares | Jun. 30, 2017$ / shares | Mar. 31, 2017installment$ / shares | Dec. 30, 2016$ / shares | Sep. 30, 2016CHF (SFr)$ / sharesshares | Jun. 24, 2016$ / shares | Mar. 25, 2016$ / shares | Dec. 25, 2015$ / shares | Sep. 25, 2015$ / shares | Jun. 26, 2015$ / shares | Mar. 27, 2015$ / shares | Dec. 26, 2014$ / shares | Sep. 26, 2014$ / shares | Jun. 27, 2014$ / shares | Sep. 29, 2017USD ($)$ / sharesshares | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 25, 2015USD ($)$ / sharesshares | Mar. 30, 2018$ / shares | Dec. 29, 2017$ / shares | Sep. 29, 2017USD ($)shares | Sep. 30, 2016USD ($)shares | |
Shareholders' Equity | |||||||||||||||||||||||||||||
Maximum percentage of conditional shares that we may authorize for issuance | 50.00% | ||||||||||||||||||||||||||||
Maximum percentage of shares that the board may authorize for issuance | 50.00% | ||||||||||||||||||||||||||||
Treasury shares | shares | 5,356,369 | 27,554,005 | 5,356,369 | 27,554,005 | |||||||||||||||||||||||||
Common shares held in treasury, owned by subsidiary | shares | 5,000,000 | 2,000,000 | 5,000,000 | 2,000,000 | |||||||||||||||||||||||||
Cancellation of treasury shares (in shares) | shares | 26,000,000 | 31,000,000 | 5,000,000 | ||||||||||||||||||||||||||
Contributed surplus | $ 0 | $ 1,801 | |||||||||||||||||||||||||||
Contributed surplus established for Swiss tax and statutory purposes ("Swiss Contributed Surplus") | SFr 7,300 | SFr 7,878 | 6,420 | 6,992 | |||||||||||||||||||||||||
Dividend or cash distribution approved (in currency per share) | (per share) | SFr 1.62 | $ 1.60 | SFr 1.48 | $ 1.48 | SFr 1.27 | $ 1.32 | SFr 1.04 | $ 1.16 | |||||||||||||||||||||
Number of quarterly dividend installments | installment | 4 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | 4 | ||||||||||||||||||||
Cash distribution quarterly installment payable (in dollars per share) | $ / shares | $ 0.40 | $ 0.40 | |||||||||||||||||||||||||||
Cash dividend paid (in dollars per share) | $ / shares | SFr 0.40 | $ 0.40 | $ 0.37 | $ 0.37 | SFr 0.37 | $ 0.37 | $ 0.33 | $ 0.33 | $ 0.33 | $ 0.33 | $ 0.29 | $ 0.29 | $ 0.29 | $ 0.29 | $ 1.54 | $ 1.40 | $ 1.24 | ||||||||||||
Unpaid portion of the dividend payment recorded in accrued and other current liabilities | 281 | $ 263 | |||||||||||||||||||||||||||
Share repurchase program, increase in authorized amount | $ 1,000 | $ 3,000 | |||||||||||||||||||||||||||
Number of common shares repurchased | shares | 8,000,000 | 43,000,000 | 18,000,000 | ||||||||||||||||||||||||||
Repurchase value | $ 621 | $ 2,610 | $ 1,163 | ||||||||||||||||||||||||||
Amount available for repurchase, at end of period | $ 480 |
Accumulated Other Comprehensi95
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax. | |||
Balance at the beginning of the period | $ (542) | $ (373) | $ (17) |
Other comprehensive (loss) income before reclassifications | 448 | (273) | (727) |
Amounts reclassified from accumulated other comprehensive income (loss) | 59 | 79 | 344 |
Income tax (expense) benefit | (125) | 25 | 27 |
Other comprehensive income (loss) | 382 | (169) | (356) |
Balance at the end of the period | (160) | (542) | (373) |
Currency Translation | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax. | |||
Balance at the beginning of the period | 316 | 408 | 720 |
Other comprehensive (loss) income before reclassifications | 38 | (69) | (536) |
Amounts reclassified from accumulated other comprehensive income (loss) | (1) | (23) | 224 |
Other comprehensive income (loss) | 37 | (92) | (312) |
Balance at the end of the period | 353 | 316 | 408 |
Unrecognized Pension and Postretirement Benefit Costs | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax. | |||
Balance at the beginning of the period | (826) | (738) | (692) |
Other comprehensive (loss) income before reclassifications | 378 | (190) | (147) |
Amounts reclassified from accumulated other comprehensive income (loss) | 74 | 70 | 75 |
Income tax (expense) benefit | (122) | 32 | 26 |
Other comprehensive income (loss) | 330 | (88) | (46) |
Balance at the end of the period | (496) | (826) | (738) |
Gain (Losses) on Cash Flow Hedges | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax. | |||
Balance at the beginning of the period | (32) | (43) | (45) |
Other comprehensive (loss) income before reclassifications | 32 | (14) | (44) |
Amounts reclassified from accumulated other comprehensive income (loss) | (14) | 32 | 45 |
Income tax (expense) benefit | (3) | (7) | 1 |
Other comprehensive income (loss) | 15 | 11 | 2 |
Balance at the end of the period | (17) | (32) | (43) |
Accumulated Other Comprehensive Loss | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax. | |||
Other comprehensive income (loss) | $ 382 | $ (169) | $ (356) |
Share Plans (Details)
Share Plans (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2017 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Share Based Compensation Arrangements: | ||||
Increase in number of shares available under Stock and Incentive plan | 10,000,000 | |||
Maximum number of common shares to be issued as awards | 77,000,000 | |||
Shares available for issuance | 23,000,000 | |||
Share-based compensation expense | $ 99 | $ 91 | $ 89 | |
Tax benefit associated with share based compensation arrangements | 32 | 29 | 29 | |
Additional disclosures | ||||
Total cash received by the Company related to the exercise of options | $ 117 | $ 90 | $ 103 | |
Restricted share awards | ||||
Share Based Compensation Arrangements: | ||||
Vesting period | 4 years | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested | ||||
Outstanding shares at the beginning of the period | 2,287,004 | |||
Shares granted | 821,016 | |||
Shares vested | (937,917) | |||
Shares forfeited | (179,319) | |||
Outstanding shares at the end of the period | 1,990,784 | 2,287,004 | ||
Weighted-average grant-date fair value at the beginning of the period (in dollars per share) | $ 58.47 | |||
Shares granted, weighted-average grant-date fair value (in dollars per share) | 67.72 | $ 64.88 | $ 62.45 | |
Shares vested, weighted-average grant-date fair value (in dollars per share) | 52.89 | |||
Shares forfeited, weighted-average grant-date fair value (in dollars per share) | 63.12 | |||
Weighted-average grant-date fair value at the end of the period (in dollars per share) | $ 64.40 | $ 58.47 | ||
Share Based Compensation Expenses Not Recognized | ||||
Share-based compensation, share-based awards, total compensation expense not yet recognized | $ 74 | |||
Share-based compensation, share-based awards, total compensation expense not yet recognized, expected period for recognition | 1 year 8 months 12 days | |||
Additional disclosures | ||||
Total fair value of share awards, vested during the period | $ 50 | $ 51 | $ 58 | |
Performance share awards | ||||
Share Based Compensation Arrangements: | ||||
Vesting period | 3 years | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested | ||||
Outstanding shares at the beginning of the period | 626,625 | |||
Shares granted | 376,380 | |||
Shares vested | (281,417) | |||
Shares forfeited | (18,181) | |||
Outstanding shares at the end of the period | 703,407 | 626,625 | ||
Weighted-average grant-date fair value at the beginning of the period (in dollars per share) | $ 60.56 | |||
Shares granted, weighted-average grant-date fair value (in dollars per share) | 62.88 | $ 55.15 | $ 61.65 | |
Shares vested, weighted-average grant-date fair value (in dollars per share) | 51.61 | |||
Shares forfeited, weighted-average grant-date fair value (in dollars per share) | 65.12 | |||
Weighted-average grant-date fair value at the end of the period (in dollars per share) | $ 65.13 | $ 60.56 | ||
Share Based Compensation Expenses Not Recognized | ||||
Share-based compensation, share-based awards, total compensation expense not yet recognized | $ 28 | |||
Share-based compensation, share-based awards, total compensation expense not yet recognized, expected period for recognition | 1 year 2 months 12 days | |||
Additional disclosures | ||||
Total fair value of share awards, vested during the period | $ 15 | $ 15 | ||
Performance share awards | Minimum | ||||
Share Based Compensation Expenses Not Recognized | ||||
Pay-out of performance share award (as a percent) | 0.00% | |||
Performance share awards | Maximum | ||||
Share Based Compensation Expenses Not Recognized | ||||
Pay-out of performance share award (as a percent) | 200.00% | |||
Share options | ||||
Share Based Compensation Arrangements: | ||||
Vesting period | 4 years | |||
Expiration period | 10 years | |||
Share Based Compensation Expenses Not Recognized | ||||
Share-based compensation, share-based awards, total compensation expense not yet recognized | $ 37 | |||
Share-based compensation, share-based awards, total compensation expense not yet recognized, expected period for recognition | 1 year 10 months 24 days | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding | ||||
Outstanding share options at the beginning of the period | 9,104,380 | |||
Share options granted | 2,076,300 | |||
Share options exercised | (3,313,145) | |||
Share options expired | (2,307) | |||
Share options forfeited | (180,135) | |||
Outstanding share options at the end of the period | 7,685,093 | 9,104,380 | ||
Share options outstanding, weighted-average exercise price at the beginning of the period (in dollars per share) | $ 45.79 | |||
Share options granted, weighted-average exercise price (in dollars per share) | 66.76 | $ 65.70 | 61.70 | |
Share options exercised, weighted-average exercise price (in dollars per share) | 34.96 | |||
Share options expired, weighted-average exercise price (in dollars per share) | 45.08 | |||
Share options forfeited, weighted-average exercise price (in dollars per share) | 63.24 | |||
Share options outstanding, weighted-average exercise price at the end of the period (in dollars per share) | $ 55.70 | 45.79 | ||
Share options vested and expected to vest at end of period | 7,228,213 | |||
Share options exercisable at end of period | 3,482,445 | |||
Share options vested and expected to vest at end of period, weighted-average exercise price (in dollars per share) | $ 55.14 | |||
Share options exercisable at end of period, weighted-average exercise price (in dollars per share) | $ 44.91 | |||
Share options outstanding at end of period, weighted-average remaining contractual term | 7 years | |||
Share options vested and expected to vest at end of period, weighted-average remaining contractual term | 7 years | |||
Share options exercisable at end of period, weighted-average remaining contractual term | 5 years 4 months 24 days | |||
Share options outstanding at end of period, aggregate intrinsic value | $ 210 | |||
Share options vested and expected to vest at end of period, aggregate intrinsic value | 202 | |||
Share options exercisable at end of period, aggregate intrinsic value | $ 133 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology | ||||
Options granted, weighted-average grant-date fair value (in dollars per share) | $ 12.80 | $ 14.26 | $ 18.77 | |
Expected share price volatility (as a percent) | 24.00% | 26.00% | 36.00% | |
Risk free interest rate (as a percent) | 1.90% | 2.00% | 2.00% | |
Expected annual dividend per share | $ 1.48 | $ 1.32 | $ 1.16 | |
Expected life of options (in years) | 5 years 7 months 6 days | 5 years 8 months 12 days | 6 years | |
Additional disclosures | ||||
Total intrinsic value of the Company's options exercised | $ 130 | $ 67 | $ 107 |
Segment and Geographic Data - S
Segment and Geographic Data - Sales, Operating Income, Depreciation and Amortization, CapEx (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 29, 2017USD ($) | Jun. 30, 2017USD ($) | Mar. 31, 2017USD ($) | Dec. 30, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 24, 2016USD ($) | Mar. 25, 2016USD ($) | Dec. 25, 2015USD ($) | Sep. 29, 2017USD ($)segment | Sep. 30, 2016USD ($) | Sep. 25, 2015USD ($) | |
Segment Data | |||||||||||
Number of reportable segments | segment | 3 | ||||||||||
Net sales | $ 3,456 | $ 3,367 | $ 3,227 | $ 3,063 | $ 3,332 | $ 3,121 | $ 2,952 | $ 2,833 | $ 13,113 | $ 12,238 | $ 12,233 |
Operating income | 2,047 | 1,902 | 1,749 | ||||||||
Gain on divestiture | 144 | ||||||||||
Depreciation and Amortization | 635 | 585 | 616 | ||||||||
Capital Expenditures | 702 | 628 | 600 | ||||||||
Circuit Protection Devices | |||||||||||
Segment Data | |||||||||||
Gain on divestiture | $ 146 | 144 | |||||||||
Transportation Solutions | |||||||||||
Segment Data | |||||||||||
Net sales | 7,039 | 6,503 | 6,351 | ||||||||
Operating income | 1,299 | 1,191 | 1,193 | ||||||||
Depreciation and Amortization | 359 | 337 | 347 | ||||||||
Capital Expenditures | 471 | 429 | 400 | ||||||||
Industrial Solutions | |||||||||||
Segment Data | |||||||||||
Net sales | 3,507 | 3,215 | 3,179 | ||||||||
Operating income | 364 | 343 | 352 | ||||||||
Depreciation and Amortization | 165 | 131 | 123 | ||||||||
Capital Expenditures | 122 | 107 | 104 | ||||||||
Communications Solutions | |||||||||||
Segment Data | |||||||||||
Net sales | 2,567 | 2,520 | 2,703 | ||||||||
Operating income | 384 | 368 | 204 | ||||||||
Depreciation and Amortization | 111 | 117 | 146 | ||||||||
Capital Expenditures | $ 109 | $ 92 | $ 96 |
Segment and Geographic Data - A
Segment and Geographic Data - Assets (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 |
Segment Data | |||
Assets | $ 19,403 | $ 17,608 | $ 20,589 |
Other non-current assets | 444 | 299 | |
Total segment assets | |||
Segment Data | |||
Assets | 7,503 | 6,694 | 6,655 |
Transportation Solutions | |||
Segment Data | |||
Assets | 4,072 | 3,501 | 3,310 |
Industrial Solutions | |||
Segment Data | |||
Assets | 1,905 | 1,720 | 1,720 |
Communications Solutions | |||
Segment Data | |||
Assets | 1,526 | 1,473 | 1,625 |
Reconciling items | |||
Segment Data | |||
Other current assets | 1,823 | 1,133 | 4,150 |
Other non-current assets | $ 10,077 | $ 9,781 | $ 9,784 |
Segment and Geographic Data - B
Segment and Geographic Data - By Region (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 29, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 30, 2016 | Sep. 30, 2016 | Jun. 24, 2016 | Mar. 25, 2016 | Dec. 25, 2015 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Segment Data | |||||||||||
Net sales | $ 3,456 | $ 3,367 | $ 3,227 | $ 3,063 | $ 3,332 | $ 3,121 | $ 2,952 | $ 2,833 | $ 13,113 | $ 12,238 | $ 12,233 |
Property, Plant, and Equipment, Net | 3,400 | 3,052 | 3,400 | 3,052 | 2,920 | ||||||
U.S. | |||||||||||
Segment Data | |||||||||||
Net sales | 4,063 | 3,901 | 3,817 | ||||||||
Property, Plant, and Equipment, Net | 980 | 922 | 980 | 922 | 887 | ||||||
Other Americas | |||||||||||
Segment Data | |||||||||||
Net sales | 338 | 298 | 321 | ||||||||
Property, Plant, and Equipment, Net | 100 | 93 | 100 | 93 | 87 | ||||||
Total Americas | |||||||||||
Segment Data | |||||||||||
Net sales | 4,401 | 4,199 | 4,138 | ||||||||
Property, Plant, and Equipment, Net | 1,080 | 1,015 | 1,080 | 1,015 | 974 | ||||||
Switzerland | |||||||||||
Segment Data | |||||||||||
Net sales | 3,016 | 2,979 | 2,992 | ||||||||
Property, Plant, and Equipment, Net | 80 | 62 | 80 | 62 | 55 | ||||||
Germany | |||||||||||
Segment Data | |||||||||||
Net sales | 235 | 127 | 117 | ||||||||
Property, Plant, and Equipment, Net | 412 | 334 | 412 | 334 | 313 | ||||||
Other Europe/Middle East/Africa | |||||||||||
Segment Data | |||||||||||
Net sales | 1,150 | 1,010 | 883 | ||||||||
Property, Plant, and Equipment, Net | 742 | 630 | 742 | 630 | 588 | ||||||
Total Europe/Middle East/Africa | |||||||||||
Segment Data | |||||||||||
Net sales | 4,401 | 4,116 | 3,992 | ||||||||
Property, Plant, and Equipment, Net | 1,234 | 1,026 | 1,234 | 1,026 | 956 | ||||||
China | |||||||||||
Segment Data | |||||||||||
Net sales | 2,414 | 2,165 | 2,367 | ||||||||
Property, Plant, and Equipment, Net | 555 | 491 | 555 | 491 | 529 | ||||||
Other Asia-Pacific | |||||||||||
Segment Data | |||||||||||
Net sales | 1,897 | 1,758 | 1,736 | ||||||||
Property, Plant, and Equipment, Net | 531 | 520 | 531 | 520 | 461 | ||||||
Total Asia-Pacific | |||||||||||
Segment Data | |||||||||||
Net sales | 4,311 | 3,923 | 4,103 | ||||||||
Property, Plant, and Equipment, Net | $ 1,086 | $ 1,011 | $ 1,086 | $ 1,011 | $ 990 |
Quarterly Financial Data (un100
Quarterly Financial Data (unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Sep. 29, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 30, 2016 | Sep. 30, 2016 | Jun. 24, 2016 | Mar. 25, 2016 | Dec. 25, 2015 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Quarterly Financial Data (unaudited) | |||||||||||
Net sales | $ 3,456 | $ 3,367 | $ 3,227 | $ 3,063 | $ 3,332 | $ 3,121 | $ 2,952 | $ 2,833 | $ 13,113 | $ 12,238 | $ 12,233 |
Gross margin | 1,139 | 1,138 | 1,108 | 1,065 | 1,104 | 1,022 | 962 | 945 | 4,450 | 4,033 | 4,087 |
Acquisition and integration costs | 1 | 1 | 2 | 2 | 3 | 11 | 3 | 5 | 6 | 22 | 55 |
Restructuring and other charges (credits), net | 23 | 19 | 59 | 47 | 30 | 31 | (99) | 40 | 148 | 2 | 152 |
Gain on divestiture | 144 | ||||||||||
Income tax benefit associated with settlement of certain U.S. pre-separation tax matters | 1,135 | 1,135 | 264 | ||||||||
Other nonoperating expense, settlement of certain U.S. tax matters | 604 | 604 | 84 | ||||||||
Increase (decrease) to the valuation allowance | (1) | 97 | (3) | ||||||||
Net income tax benefit related to tax settlements in certain other jurisdictions | 83 | 83 | |||||||||
Other nonoperating expense, tax settlement in another jurisdiction | 46 | 46 | |||||||||
Amounts attributable to TE Connectivity Ltd.: | |||||||||||
Income from continuing operations | 429 | 432 | 406 | 406 | 437 | 791 | 389 | 324 | 1,673 | 1,941 | 1,238 |
Income (loss) from discontinued operations, net of income taxes | 5 | 3 | (1) | 3 | 48 | (9) | 29 | 10 | 68 | 1,182 | |
Net income | $ 434 | $ 435 | $ 405 | $ 409 | $ 437 | $ 839 | $ 380 | $ 353 | $ 1,683 | $ 2,009 | $ 2,420 |
Basic earnings per share attributable to TE Connectivity Ltd.: | |||||||||||
Income from continuing operations (in dollars per share) | $ 1.22 | $ 1.22 | $ 1.14 | $ 1.14 | $ 1.23 | $ 2.22 | $ 1.07 | $ 0.84 | $ 4.71 | $ 5.30 | $ 3.06 |
Net income (in dollars per share) | 1.23 | 1.23 | 1.14 | 1.15 | 1.23 | 2.35 | 1.04 | 0.92 | 4.74 | 5.49 | 5.98 |
Diluted earnings per share attributable to TE Connectivity Ltd.: | |||||||||||
Income from continuing operations (in dollars per share) | 1.21 | 1.21 | 1.13 | 1.13 | 1.22 | 2.19 | 1.06 | 0.83 | 4.67 | 5.26 | 3.01 |
Net income (in dollars per share) | $ 1.22 | $ 1.22 | $ 1.13 | $ 1.14 | $ 1.22 | $ 2.32 | $ 1.03 | $ 0.91 | $ 4.70 | $ 5.44 | $ 5.89 |
Certain U.S. Deferred Tax Assets | |||||||||||
Quarterly Financial Data (unaudited) | |||||||||||
Increase (decrease) to the valuation allowance | $ 91 | $ 91 | |||||||||
Circuit Protection Devices | |||||||||||
Quarterly Financial Data (unaudited) | |||||||||||
Gain on divestiture | $ 146 | $ 144 |
Tyco Electronics Group S.A. - O
Tyco Electronics Group S.A. - Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Sep. 29, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 30, 2016 | Sep. 30, 2016 | Jun. 24, 2016 | Mar. 25, 2016 | Dec. 25, 2015 | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | Aug. 31, 2017 | |
Tyco Electronics Group S.A. | ||||||||||||
Ownership percentage in TEGSA | 100.00% | 100.00% | 100.00% | 100.00% | 100.00% | |||||||
Statement of Operations Detail: | ||||||||||||
Net sales | $ 3,456 | $ 3,367 | $ 3,227 | $ 3,063 | $ 3,332 | $ 3,121 | $ 2,952 | $ 2,833 | $ 13,113 | $ 12,238 | $ 12,233 | |
Cost of sales | 8,663 | 8,205 | 8,146 | |||||||||
Gross margin | 1,139 | 1,138 | 1,108 | 1,065 | 1,104 | 1,022 | 962 | 945 | 4,450 | 4,033 | 4,087 | |
Selling, general, and administrative expenses, net | 1,591 | 1,463 | 1,504 | |||||||||
Research, development, and engineering expenses | 658 | 644 | 627 | |||||||||
Acquisition and integration costs | 1 | 1 | 2 | 2 | 3 | 11 | 3 | 5 | 6 | 22 | 55 | |
Restructuring and other charges (credits), net | 23 | 19 | 59 | 47 | 30 | 31 | (99) | 40 | 148 | 2 | 152 | |
Operating income | 2,047 | 1,902 | 1,749 | |||||||||
Interest income | 20 | 19 | 17 | |||||||||
Interest expense | (130) | (127) | (136) | |||||||||
Other expense, net | (9) | (632) | (55) | |||||||||
Income from continuing operations before income taxes | 1,928 | 1,162 | 1,575 | |||||||||
Income tax (expense) benefit | (255) | 779 | (337) | |||||||||
Income from continuing operations | 429 | 432 | 406 | 406 | 437 | 791 | 389 | 324 | 1,673 | 1,941 | 1,238 | |
Income (loss) from discontinued operations, net of income taxes | 5 | 3 | (1) | 3 | 48 | (9) | 29 | 10 | 68 | 1,182 | ||
Net income | $ 434 | $ 435 | $ 405 | $ 409 | $ 437 | $ 839 | $ 380 | $ 353 | 1,683 | 2,009 | 2,420 | |
Other comprehensive income (loss) | 382 | (169) | (356) | |||||||||
Comprehensive income | 2,065 | 1,840 | 2,064 | |||||||||
Consolidating Adjustments | ||||||||||||
Statement of Operations Detail: | ||||||||||||
Equity in net income of subsidiaries | (5,708) | (4,400) | (3,716) | |||||||||
Equity in net income of subsidiaries of discontinued operations | (33) | (235) | (1,547) | |||||||||
Income from continuing operations before income taxes | (5,741) | (4,635) | (5,263) | |||||||||
Income from continuing operations | (5,741) | (4,635) | (5,263) | |||||||||
Net income | (5,741) | (4,635) | (5,263) | |||||||||
Other comprehensive income (loss) | (757) | 312 | 724 | |||||||||
Comprehensive income | (6,498) | (4,323) | (4,539) | |||||||||
TE Connectivity Ltd. | Consolidating Reportable entities | ||||||||||||
Statement of Operations Detail: | ||||||||||||
Selling, general, and administrative expenses, net | 184 | 168 | 163 | |||||||||
Restructuring and other charges (credits), net | 2 | |||||||||||
Operating income | (184) | (170) | (163) | |||||||||
Equity in net income of subsidiaries | 1,889 | 2,139 | 1,398 | |||||||||
Equity in net income of subsidiaries of discontinued operations | 10 | 67 | 1,182 | |||||||||
Intercompany interest income (expense), net | (32) | (28) | 3 | |||||||||
Income from continuing operations before income taxes | 1,683 | 2,008 | 2,420 | |||||||||
Income from continuing operations | 1,683 | 2,008 | 2,420 | |||||||||
Income (loss) from discontinued operations, net of income taxes | 1 | |||||||||||
Net income | 1,683 | 2,009 | 2,420 | |||||||||
Other comprehensive income (loss) | 382 | (169) | (356) | |||||||||
Comprehensive income | 2,065 | 1,840 | 2,064 | |||||||||
TEGSA | Consolidating Reportable entities | ||||||||||||
Statement of Operations Detail: | ||||||||||||
Selling, general, and administrative expenses, net | 1,911 | 95 | 835 | |||||||||
Restructuring and other charges (credits), net | (1) | |||||||||||
Operating income | (1,911) | (94) | (835) | |||||||||
Interest expense | (129) | (126) | (135) | |||||||||
Equity in net income of subsidiaries | 3,819 | 2,261 | 2,318 | |||||||||
Equity in net income of subsidiaries of discontinued operations | 23 | 168 | 365 | |||||||||
Intercompany interest income (expense), net | 110 | 98 | 50 | |||||||||
Income from continuing operations before income taxes | 1,912 | 2,307 | 1,763 | |||||||||
Income from continuing operations | 1,912 | 2,307 | 1,763 | |||||||||
Income (loss) from discontinued operations, net of income taxes | (13) | (101) | 817 | |||||||||
Net income | 1,899 | 2,206 | 2,580 | |||||||||
Other comprehensive income (loss) | 382 | (169) | (356) | |||||||||
Comprehensive income | 2,281 | 2,037 | 2,224 | |||||||||
Intercompany transaction gains (losses) | (1,965) | (80) | (846) | |||||||||
Other Subsidiaries | Consolidating Reportable entities | ||||||||||||
Statement of Operations Detail: | ||||||||||||
Net sales | 13,113 | 12,238 | 12,233 | |||||||||
Cost of sales | 8,663 | 8,205 | 8,146 | |||||||||
Gross margin | 4,450 | 4,033 | 4,087 | |||||||||
Selling, general, and administrative expenses, net | (504) | 1,200 | 506 | |||||||||
Research, development, and engineering expenses | 658 | 644 | 627 | |||||||||
Acquisition and integration costs | 6 | 22 | 55 | |||||||||
Restructuring and other charges (credits), net | 148 | 1 | 152 | |||||||||
Operating income | 4,142 | 2,166 | 2,747 | |||||||||
Interest income | 20 | 19 | 17 | |||||||||
Interest expense | (1) | (1) | (1) | |||||||||
Other expense, net | (9) | (632) | (55) | |||||||||
Intercompany interest income (expense), net | (78) | (70) | (53) | |||||||||
Income from continuing operations before income taxes | 4,074 | 1,482 | 2,655 | |||||||||
Income tax (expense) benefit | (255) | 779 | (337) | |||||||||
Income from continuing operations | 3,819 | 2,261 | 2,318 | |||||||||
Income (loss) from discontinued operations, net of income taxes | 23 | 168 | 365 | |||||||||
Net income | 3,842 | 2,429 | 2,683 | |||||||||
Other comprehensive income (loss) | 375 | (143) | (368) | |||||||||
Comprehensive income | $ 4,217 | $ 2,286 | $ 2,315 |
Tyco Electronics Group S.A. - B
Tyco Electronics Group S.A. - Balance Sheet (Details) - USD ($) $ in Millions | Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | Sep. 26, 2014 |
Current assets: | ||||
Cash and cash equivalents | $ 1,218 | $ 647 | $ 3,329 | $ 2,457 |
Accounts receivable, net | 2,290 | 2,046 | ||
Inventories | 1,813 | 1,596 | ||
Prepaid expenses and other current assets | 605 | 486 | ||
Total current assets | 5,926 | 4,775 | ||
Property, plant, and equipment, net | 3,400 | 3,052 | 2,920 | |
Goodwill | 5,651 | 5,492 | 4,824 | |
Intangible assets, net | 1,841 | 1,879 | ||
Deferred income taxes | 2,141 | 2,111 | ||
Other assets | 444 | 299 | ||
Total Assets | 19,403 | 17,608 | 20,589 | |
Current liabilities: | ||||
Short-term debt | 710 | 331 | ||
Accounts payable | 1,436 | 1,090 | ||
Accrued and other current liabilities | 1,626 | 1,437 | ||
Deferred revenue | 75 | 208 | ||
Total current liabilities | 3,847 | 3,066 | ||
Long-term debt | 3,634 | 3,739 | ||
Long-term pension and postretirement liabilities | 1,160 | 1,502 | ||
Deferred income taxes | 236 | 207 | ||
Income taxes | 293 | 247 | ||
Other liabilities | 482 | 362 | ||
Total Liabilities | 9,652 | 9,123 | ||
Total Shareholders' Equity | 9,751 | 8,485 | 9,585 | 9,007 |
Total Liabilities and Shareholders' Equity | 19,403 | 17,608 | ||
Consolidating Adjustments | ||||
Current assets: | ||||
Intercompany receivables | (2,023) | (1,399) | ||
Total current assets | (2,023) | (1,399) | ||
Investment in subsidiaries | (32,069) | (29,478) | ||
Intercompany loans receivable | (13,727) | (14,074) | ||
Total Assets | (47,819) | (44,951) | ||
Current liabilities: | ||||
Intercompany payables | (2,023) | (1,399) | ||
Total current liabilities | (2,023) | (1,399) | ||
Intercompany loans payable | (13,727) | (14,074) | ||
Total Liabilities | (15,750) | (15,473) | ||
Total Shareholders' Equity | (32,069) | (29,478) | ||
Total Liabilities and Shareholders' Equity | (47,819) | (44,951) | ||
TE Connectivity Ltd. | Consolidating Reportable entities | ||||
Current assets: | ||||
Intercompany receivables | 49 | 37 | ||
Prepaid expenses and other current assets | 4 | 3 | ||
Total current assets | 53 | 40 | ||
Investment in subsidiaries | 11,960 | 10,053 | ||
Intercompany loans receivable | 22 | |||
Total Assets | 12,013 | 10,115 | ||
Current liabilities: | ||||
Accounts payable | 2 | 1 | ||
Accrued and other current liabilities | 286 | 266 | ||
Intercompany payables | 1,974 | 1,363 | ||
Total current liabilities | 2,262 | 1,630 | ||
Total Liabilities | 2,262 | 1,630 | ||
Total Shareholders' Equity | 9,751 | 8,485 | ||
Total Liabilities and Shareholders' Equity | 12,013 | 10,115 | ||
TEGSA | Consolidating Reportable entities | ||||
Current assets: | ||||
Cash and cash equivalents | 1 | |||
Intercompany receivables | 1,914 | 1,314 | ||
Prepaid expenses and other current assets | 96 | 17 | ||
Total current assets | 2,010 | 1,331 | ||
Investment in subsidiaries | 20,109 | 19,425 | ||
Intercompany loans receivable | 4,027 | 3,739 | ||
Other assets | 6 | 14 | ||
Total Assets | 26,152 | 24,509 | ||
Current liabilities: | ||||
Short-term debt | 708 | 330 | ||
Accrued and other current liabilities | 59 | 57 | ||
Total current liabilities | 767 | 387 | ||
Long-term debt | 3,629 | 3,737 | ||
Intercompany loans payable | 9,700 | 10,314 | ||
Other liabilities | 96 | 18 | ||
Total Liabilities | 14,192 | 14,456 | ||
Total Shareholders' Equity | 11,960 | 10,053 | ||
Total Liabilities and Shareholders' Equity | 26,152 | 24,509 | ||
Other Subsidiaries | Consolidating Reportable entities | ||||
Current assets: | ||||
Cash and cash equivalents | 1,218 | 647 | $ 3,329 | $ 2,456 |
Accounts receivable, net | 2,290 | 2,046 | ||
Inventories | 1,813 | 1,596 | ||
Intercompany receivables | 60 | 48 | ||
Prepaid expenses and other current assets | 505 | 466 | ||
Total current assets | 5,886 | 4,803 | ||
Property, plant, and equipment, net | 3,400 | 3,052 | ||
Goodwill | 5,651 | 5,492 | ||
Intangible assets, net | 1,841 | 1,879 | ||
Deferred income taxes | 2,141 | 2,111 | ||
Intercompany loans receivable | 9,700 | 10,313 | ||
Other assets | 438 | 285 | ||
Total Assets | 29,057 | 27,935 | ||
Current liabilities: | ||||
Short-term debt | 2 | 1 | ||
Accounts payable | 1,434 | 1,089 | ||
Accrued and other current liabilities | 1,281 | 1,114 | ||
Deferred revenue | 75 | 208 | ||
Intercompany payables | 49 | 36 | ||
Total current liabilities | 2,841 | 2,448 | ||
Long-term debt | 5 | 2 | ||
Intercompany loans payable | 4,027 | 3,760 | ||
Long-term pension and postretirement liabilities | 1,160 | 1,502 | ||
Deferred income taxes | 236 | 207 | ||
Income taxes | 293 | 247 | ||
Other liabilities | 386 | 344 | ||
Total Liabilities | 8,948 | 8,510 | ||
Total Shareholders' Equity | 20,109 | 19,425 | ||
Total Liabilities and Shareholders' Equity | $ 29,057 | $ 27,935 |
Tyco Electronics Group S.A. - C
Tyco Electronics Group S.A. - Cash Flows (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Cash Flows From Operating Activities: | |||
Net cash provided by (used in) continuing operating activities | $ 2,322 | $ 2,044 | $ 1,636 |
Net cash provided by (used in) discontinued operating activities | (1) | (97) | 294 |
Net cash provided by operating activities | 2,321 | 1,947 | 1,930 |
Cash Flows From Investing Activities: | |||
Capital expenditures | (702) | (628) | (600) |
Proceeds from sale of property, plant, and equipment | 19 | 8 | 17 |
Acquisition of businesses, net of cash acquired | (250) | (1,336) | (1,725) |
Proceeds from divestiture of business, net of cash retained by sold business | 4 | 333 | |
Proceeds from divestiture of discontinued operations, net of cash retained by sold operations | (19) | 2,957 | |
Other | (3) | 61 | 12 |
Net cash used in continuing investing activities | (932) | (1,581) | 661 |
Net cash used in discontinued investing activities | (25) | ||
Net cash provided by (used in) investing activities | (932) | (1,581) | 636 |
Cash Flows From Financing Activities: | |||
Net increase (decrease) in commercial paper | (330) | 330 | (328) |
Proceeds from issuance of debt | 589 | 352 | 617 |
Repayment of debt | (501) | (473) | |
Proceeds from exercise of share options | 117 | 90 | 103 |
Repurchase of common shares | (614) | (2,787) | (1,023) |
Payment of common share dividends to shareholders | (546) | (509) | (502) |
Transfers (to) from discontinued operations | (1) | (97) | 269 |
Other | (30) | (30) | (17) |
Net cash used in continuing financing activities | (815) | (3,152) | (1,354) |
Net cash provided by (used in) discontinued financing activities | 1 | 97 | (269) |
Net cash used in financing activities | (814) | (3,055) | (1,623) |
Effect of currency translation on cash | (4) | 7 | (71) |
Net increase (decrease) in cash and cash equivalents | 571 | (2,682) | 872 |
Cash and cash equivalents at beginning of fiscal year | 647 | 3,329 | 2,457 |
Cash and cash equivalents at end of fiscal year | 1,218 | 647 | 3,329 |
Consolidating Adjustments | |||
Cash Flows From Operating Activities: | |||
Net cash provided by (used in) continuing operating activities | (230) | (336) | (2,661) |
Net cash provided by operating activities | (230) | (336) | (2,661) |
Cash Flows From Investing Activities: | |||
Intercompany distribution receipts | (516) | (2,811) | |
Change in intercompany loans | 1,369 | 1,244 | 1,304 |
Net cash used in continuing investing activities | 1,304 | ||
Net cash provided by (used in) investing activities | 853 | (1,567) | 1,304 |
Cash Flows From Financing Activities: | |||
Intercompany distributions | 746 | 3,147 | 2,661 |
Loan activity with parent | (1,369) | (1,244) | (1,304) |
Net cash used in continuing financing activities | (623) | 1,903 | 1,357 |
Net cash used in financing activities | (623) | 1,903 | 1,357 |
TE Connectivity Ltd. | Consolidating Reportable entities | |||
Cash Flows From Operating Activities: | |||
Net cash provided by (used in) continuing operating activities | (180) | (37) | 1,186 |
Net cash provided by operating activities | (180) | (37) | 1,186 |
Cash Flows From Investing Activities: | |||
Intercompany distribution receipts | 1,082 | ||
Net cash provided by (used in) investing activities | 1,082 | ||
Cash Flows From Financing Activities: | |||
Changes in parent company equity | 97 | 410 | 80 |
Repurchase of common shares | (2,780) | (916) | |
Payment of common share dividends to shareholders | (550) | (513) | (515) |
Loan activity with parent | 633 | 1,838 | 165 |
Net cash used in continuing financing activities | 180 | (1,045) | (1,186) |
Net cash used in financing activities | 180 | (1,045) | (1,186) |
TEGSA | Consolidating Reportable entities | |||
Cash Flows From Operating Activities: | |||
Net cash provided by (used in) continuing operating activities | 102 | 211 | 1,270 |
Net cash provided by operating activities | 102 | 211 | 1,270 |
Cash Flows From Investing Activities: | |||
Proceeds from divestiture of business, net of cash retained by sold business | 199 | ||
Proceeds from divestiture of discontinued operations, net of cash retained by sold operations | (120) | 709 | |
Intercompany distribution receipts | 516 | 1,729 | |
Change in intercompany loans | (1,369) | (1,244) | (1,304) |
Other | (12) | ||
Net cash used in continuing investing activities | (595) | ||
Net cash provided by (used in) investing activities | (865) | 564 | (595) |
Cash Flows From Financing Activities: | |||
Changes in parent company equity | 559 | 300 | 624 |
Net increase (decrease) in commercial paper | (330) | 330 | (328) |
Proceeds from issuance of debt | 589 | 349 | 617 |
Repayment of debt | (500) | (250) | |
Intercompany distributions | (50) | (1,250) | (1,335) |
Other | (5) | (4) | (4) |
Net cash used in continuing financing activities | 763 | (775) | (676) |
Net cash used in financing activities | 763 | (775) | (676) |
Net increase (decrease) in cash and cash equivalents | (1) | ||
Cash and cash equivalents at beginning of fiscal year | 1 | ||
Other Subsidiaries | Consolidating Reportable entities | |||
Cash Flows From Operating Activities: | |||
Net cash provided by (used in) continuing operating activities | 2,630 | 2,206 | 1,841 |
Net cash provided by (used in) discontinued operating activities | (1) | (97) | 294 |
Net cash provided by operating activities | 2,629 | 2,109 | 2,135 |
Cash Flows From Investing Activities: | |||
Capital expenditures | (702) | (628) | (600) |
Proceeds from sale of property, plant, and equipment | 19 | 8 | 17 |
Acquisition of businesses, net of cash acquired | (250) | (1,336) | (1,725) |
Proceeds from divestiture of business, net of cash retained by sold business | 4 | 134 | |
Proceeds from divestiture of discontinued operations, net of cash retained by sold operations | 101 | 2,248 | |
Other | 9 | 61 | 12 |
Net cash used in continuing investing activities | (48) | ||
Net cash used in discontinued investing activities | (25) | ||
Net cash provided by (used in) investing activities | (920) | (1,660) | (73) |
Cash Flows From Financing Activities: | |||
Changes in parent company equity | (656) | (710) | (704) |
Proceeds from issuance of debt | 3 | ||
Repayment of debt | (1) | (223) | |
Proceeds from exercise of share options | 117 | 90 | 103 |
Repurchase of common shares | (614) | (7) | (107) |
Payment of common share dividends to shareholders | 4 | 4 | 13 |
Intercompany distributions | (696) | (1,897) | (1,326) |
Loan activity with parent | 736 | (594) | 1,139 |
Transfers (to) from discontinued operations | (1) | (97) | 269 |
Other | (25) | (26) | (13) |
Net cash used in continuing financing activities | (1,135) | (3,235) | (849) |
Net cash provided by (used in) discontinued financing activities | 1 | 97 | (269) |
Net cash used in financing activities | (1,134) | (3,138) | (1,118) |
Effect of currency translation on cash | (4) | 7 | (71) |
Net increase (decrease) in cash and cash equivalents | 571 | (2,682) | 873 |
Cash and cash equivalents at beginning of fiscal year | 647 | 3,329 | 2,456 |
Cash and cash equivalents at end of fiscal year | $ 1,218 | $ 647 | $ 3,329 |
SCHEDULE II-VALUATION AND QU104
SCHEDULE II-VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 29, 2017 | Sep. 30, 2016 | Sep. 25, 2015 | |
Allowance for doubtful accounts receivable | |||
Valuation and qualifying accounts. | |||
Balance at Beginning of Fiscal Year | $ 17 | $ 18 | $ 14 |
Additions Charged to Costs and Expenses | 8 | 2 | |
Acquisitions, Divestitures and Other | 1 | 3 | |
Deductions | (4) | (2) | (1) |
Balance at End of Fiscal Year | 21 | 17 | 18 |
Valuation allowance on deferred tax assets | |||
Valuation and qualifying accounts. | |||
Balance at Beginning of Fiscal Year | 3,096 | 3,237 | 1,706 |
Additions Charged to Costs and Expenses | 1,072 | 283 | 1,627 |
Acquisitions, Divestitures and Other | 1 | 1 | |
Deductions | (541) | (425) | (97) |
Balance at End of Fiscal Year | $ 3,627 | $ 3,096 | $ 3,237 |