Condensed Consolidating Financial Information | Condensed Consolidating Financial Information The following information sets forth the condensed consolidating financial information for the Parent Guarantor, the Subsidiary Guarantor, the Subsidiary Issuers, and our other subsidiaries (collectively, the “Non-Guarantor Subsidiaries”) for the periods presented in these condensed consolidated financial statements. Investments in subsidiaries are accounted for under the equity method; accordingly, entries necessary to consolidate the Parent Guarantor, the Subsidiary Guarantor, the Subsidiary Issuers and the Non-Guarantor Subsidiaries are reflected in the eliminations column. In the opinion of management, separate complete financial statements of the Subsidiary Issuers would not provide additional material information that would be useful in assessing their financial composition. See Note 7 . “ Borrowings ” for more information regarding the 2017 Senior Notes and the change in guarantors that occurred in the first quarter of fiscal year 2019. We have applied the impacts of the change in guarantors retrospectively to all periods presented. Condensed Consolidating Balance Sheet May 5, 2019 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) ASSETS Current assets: Cash and cash equivalents $ 301 $ — $ 890 $ 4,137 $ — $ 5,328 Trade accounts receivable, net — — — 3,484 — 3,484 Inventory — — — 1,034 — 1,034 Intercompany receivable 457 — 761 297 (1,515 ) — Intercompany loan receivable — — 10,088 8,289 (18,377 ) — Other current assets 131 — 59 641 — 831 Total current assets 889 — 11,798 17,882 (19,892 ) 10,677 Long-term assets: Property, plant and equipment, net — — 768 1,886 — 2,654 Goodwill — — 1,360 35,302 — 36,662 Intangible assets, net — — 81 20,107 — 20,188 Investment in subsidiaries 51,867 34,273 45,921 — (132,061 ) — Intercompany loan receivable, long-term — — — 925 (925 ) — Other long-term assets 29 — 58 648 — 735 Total assets $ 52,785 $ 34,273 $ 59,986 $ 76,750 $ (152,878 ) $ 70,916 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 27 $ — $ 48 $ 684 $ — $ 759 Employee compensation and benefits — — 103 375 — 478 Current portion of long-term debt — — 2,750 787 — 3,537 Intercompany payable 296 — 97 1,122 (1,515 ) — Intercompany loan payable 12,513 — 4,710 1,154 (18,377 ) — Other current liabilities 51 — 177 3,501 — 3,729 Total current liabilities 12,887 — 7,885 7,623 (19,892 ) 8,503 Long-term liabilities: Long-term debt 17,793 — 14,718 1,500 — 34,011 Deferred tax liabilities — 12 (348 ) 2,207 — 1,871 Intercompany loan payable, long-term — — 925 — (925 ) — Unrecognized tax benefits — — 2,314 1,042 — 3,356 Other long-term liabilities (67 ) 53 218 799 — 1,003 Total liabilities 30,613 65 25,712 13,171 (20,817 ) 48,744 Total stockholders’ equity 22,172 34,208 34,274 63,579 (132,061 ) 22,172 Total liabilities and stockholders’ equity $ 52,785 $ 34,273 $ 59,986 $ 76,750 $ (152,878 ) $ 70,916 Condensed Consolidating Balance Sheet November 4, 2018 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) ASSETS Current assets: Cash and cash equivalents $ — $ — $ 2,461 $ 1,831 $ — $ 4,292 Trade accounts receivable, net — — — 3,325 — 3,325 Inventory — — — 1,124 — 1,124 Intercompany receivable 56 — 182 67 (305 ) — Intercompany loan receivable — — 9,780 4,713 (14,493 ) — Other current assets 52 — 37 277 — 366 Total current assets 108 — 12,460 11,337 (14,798 ) 9,107 Long-term assets: Property, plant and equipment, net — — 772 1,863 — 2,635 Goodwill — — 1,360 25,553 — 26,913 Intangible assets, net — — 84 10,678 — 10,762 Investment in subsidiaries 35,268 35,268 46,745 — (117,281 ) — Intercompany loan receivable, long-term — — — 991 (991 ) — Other long-term assets — — 250 457 — 707 Total assets $ 35,376 $ 35,268 $ 61,671 $ 50,879 $ (133,070 ) $ 50,124 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Accounts payable $ 19 $ — $ 44 $ 748 $ — $ 811 Employee compensation and benefits — — 272 443 — 715 Intercompany payable 9 — 58 238 (305 ) — Intercompany loan payable 8,691 — 4,713 1,089 (14,493 ) — Other current liabilities — — 219 593 — 812 Total current liabilities 8,719 — 5,306 3,111 (14,798 ) 2,338 Long-term liabilities: Long-term debt — — 17,456 37 — 17,493 Deferred tax liabilities — — (47 ) 216 — 169 Intercompany loan payable, long-term — — 991 — (991 ) — Unrecognized tax benefits — — 2,563 525 — 3,088 Other long-term liabilities — — 131 248 — 379 Total liabilities 8,719 — 26,400 4,137 (15,789 ) 23,467 Total stockholders’ equity 26,657 35,268 35,271 46,742 (117,281 ) 26,657 Total liabilities and stockholders’ equity $ 35,376 $ 35,268 $ 61,671 $ 50,879 $ (133,070 ) $ 50,124 Condensed Consolidating Statements of Operations and Comprehensive Income Fiscal Quarter Ended May 5, 2019 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Net revenue: Products $ — $ — $ — $ 4,418 $ — $ 4,418 Subscriptions and services — — — 1,099 — 1,099 Intercompany revenue — — 420 — (420 ) — Total net revenue — — 420 5,517 (420 ) 5,517 Cost of revenue: Cost of products sold — — 35 1,422 — 1,457 Cost of subscriptions and services — — 4 131 — 135 Intercompany cost of products sold — — — 35 (35 ) — Amortization of acquisition-related intangible assets — — — 826 — 826 Restructuring charges — — — 10 — 10 Total cost of revenue — — 39 2,424 (35 ) 2,428 Gross margin — — 381 3,093 (385 ) 3,089 Research and development — — 463 688 — 1,151 Intercompany operating expense — — — 385 (385 ) — Selling, general and administrative 19 — 82 318 — 419 Amortization of acquisition-related intangible assets — — — 473 — 473 Restructuring, impairment and disposal charges — — 1 75 — 76 Total operating expenses 19 — 546 1,939 (385 ) 2,119 Operating income (loss) (19 ) — (165 ) 1,154 — 970 Interest expense (201 ) — (147 ) (28 ) — (376 ) Intercompany interest expense (106 ) — (42 ) (9 ) 157 — Other income, net 1 — 7 55 — 63 Intercompany interest income — — 81 76 (157 ) — Intercompany other income (expense), net 527 — — (527 ) — — Income (loss) from continuing operations before income taxes and earnings in subsidiaries 202 — (266 ) 721 — 657 Provision for (benefit from) income taxes (59 ) 41 (75 ) 57 — (36 ) Income (loss) from continuing operations before earnings in subsidiaries 261 (41 ) (191 ) 664 — 693 Earnings in subsidiaries 430 589 781 — (1,800 ) — Income from continuing operations and earnings in subsidiaries 691 548 590 664 (1,800 ) 693 Loss from discontinued operations, net of income taxes — — — (2 ) — (2 ) Net income $ 691 $ 548 $ 590 $ 662 $ (1,800 ) $ 691 Comprehensive income $ 691 $ 548 $ 590 $ 662 $ (1,800 ) $ 691 Condensed Consolidating Statements of Operations and Comprehensive Income Fiscal Quarter Ended May 6, 2018 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Net revenue: Products $ — $ — $ — $ 4,749 $ — $ 4,749 Subscriptions and services — — — 265 — 265 Intercompany revenue — — 566 — (566 ) — Total net revenue — — 566 5,014 (566 ) 5,014 Cost of revenue: Cost of products sold — — 32 1,640 — 1,672 Cost of subscriptions and services — — 3 21 — 24 Intercompany cost of products sold — — — 37 (37 ) — Amortization of acquisition-related intangible assets — — — 765 — 765 Restructuring charges — — — 2 — 2 Total cost of revenue — — 35 2,465 (37 ) 2,463 Gross margin — — 531 2,549 (529 ) 2,551 Research and development — — 407 529 — 936 Intercompany operating expense — — — 529 (529 ) — Selling, general and administrative 2 — 72 220 — 294 Amortization of acquisition-related intangible assets — — — 67 — 67 Restructuring, impairment and disposal charges — — 11 42 — 53 Total operating expenses 2 — 490 1,387 (529 ) 1,350 Operating income (loss) (2 ) — 41 1,162 — 1,201 Interest expense — — (148 ) — — (148 ) Intercompany interest expense — — (81 ) (519 ) 600 — Other income, net — — 28 18 — 46 Intercompany interest income — — 519 81 (600 ) — Income (loss) from continuing operations before income taxes and earnings in subsidiaries (2 ) — 359 742 — 1,099 Benefit from income taxes — — (2,521 ) (116 ) — (2,637 ) Income (loss) from continuing operations before earnings in subsidiaries (2 ) — 2,880 858 — 3,736 Earnings in subsidiaries 3,720 3,735 855 — (8,310 ) — Income from continuing operations and earnings in subsidiaries 3,718 3,735 3,735 858 (8,310 ) 3,736 Loss from discontinued operations, net of income taxes — — (2 ) (1 ) — (3 ) Net income 3,718 3,735 3,733 857 (8,310 ) 3,733 Net income attributable to noncontrolling interest — 15 — — — 15 Net income attributable to common stock $ 3,718 $ 3,720 $ 3,733 $ 857 $ (8,310 ) $ 3,718 Net income $ 3,718 $ 3,735 $ 3,733 $ 857 $ (8,310 ) $ 3,733 Other comprehensive income (loss) — — (9 ) 1 — (8 ) Comprehensive income 3,718 3,735 3,724 858 (8,310 ) 3,725 Comprehensive income attributable to noncontrolling interest — 15 — — — 15 Comprehensive income attributable to common stock $ 3,718 $ 3,720 $ 3,724 $ 858 $ (8,310 ) $ 3,710 Condensed Consolidating Statements of Operations and Comprehensive Income Two Fiscal Quarters Ended May 5, 2019 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Net revenue: Products $ — $ — $ — $ 9,057 $ — $ 9,057 Subscriptions and services — — — 2,249 — 2,249 Intercompany revenue — — 817 — (817 ) — Total net revenue — — 817 11,306 (817 ) 11,306 Cost of revenue: Cost of products sold — — 66 2,945 — 3,011 Cost of subscriptions and services — — 7 266 — 273 Intercompany cost of products sold — — — 58 (58 ) — Amortization of acquisition-related intangible assets — — — 1,659 — 1,659 Restructuring charges — — (7 ) 73 — 66 Total cost of revenue — — 66 5,001 (58 ) 5,009 Gross margin — — 751 6,305 (759 ) 6,297 Research and development — — 910 1,374 — 2,284 Intercompany operating expense — — — 759 (759 ) — Selling, general and administrative 71 — 163 656 — 890 Amortization of acquisition-related intangible assets — — — 949 — 949 Restructuring, impairment and disposal charges — — 9 640 — 649 Total operating expenses 71 — 1,082 4,378 (759 ) 4,772 Operating income (loss) (71 ) — (331 ) 1,927 — 1,525 Interest expense (376 ) — (295 ) (50 ) — (721 ) Intercompany interest expense (192 ) — (83 ) (17 ) 292 — Other income, net — — 16 115 — 131 Intercompany interest income — — 160 132 (292 ) — Intercompany other income (expense), net 604 — — (604 ) — — Income (loss) from continuing operations before income taxes and earnings in subsidiaries (35 ) — (533 ) 1,503 — 935 Provision for (benefit from) income taxes (83 ) 65 (252 ) 31 — (239 ) Income (loss) from continuing operations before earnings in subsidiaries 48 (65 ) (281 ) 1,472 — 1,174 Earnings in subsidiaries 1,114 2,068 2,350 — (5,532 ) — Income from continuing operations and earnings in subsidiaries 1,162 2,003 2,069 1,472 (5,532 ) 1,174 Loss from discontinued operations, net of income taxes — — — (12 ) — (12 ) Net income $ 1,162 $ 2,003 $ 2,069 $ 1,460 $ (5,532 ) $ 1,162 Comprehensive income $ 1,162 $ 2,003 $ 2,069 $ 1,460 $ (5,532 ) $ 1,162 Condensed Consolidating Statements of Operations and Comprehensive Income Two Fiscal Quarters Ended May 6, 2018 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Net revenue: Products $ — $ — $ — $ 9,857 $ — $ 9,857 Subscriptions and services — — — 484 — 484 Intercompany revenue — — 1,150 — (1,150 ) — Total net revenue — — 1,150 10,341 (1,150 ) 10,341 Cost of revenue: Cost of products sold — — 61 3,487 — 3,548 Cost of subscriptions and services — — 6 41 — 47 Intercompany cost of products sold — — — 71 (71 ) — Purchase accounting effect on inventory — — — 70 — 70 Amortization of acquisition-related intangible assets — — — 1,480 — 1,480 Restructuring charges — — 2 15 — 17 Total cost of revenue — — 69 5,164 (71 ) 5,162 Gross margin — — 1,081 5,177 (1,079 ) 5,179 Research and development — — 813 1,048 — 1,861 Intercompany operating expense — — — 1,079 (1,079 ) — Selling, general and administrative 2 — 157 426 — 585 Amortization of acquisition-related intangible assets — — — 406 — 406 Restructuring, impairment and disposal charges — — 44 139 — 183 Total operating expenses 2 — 1,014 3,098 (1,079 ) 3,035 Operating income (loss) (2 ) — 67 2,079 — 2,144 Interest expense — — (329 ) (2 ) — (331 ) Intercompany interest expense — — (140 ) (1,093 ) 1,233 — Other income, net — — 47 34 — 81 Intercompany interest income — — 1,093 140 (1,233 ) — Intercompany other income (expense), net — — (57 ) 57 — — Income (loss) from continuing operations before income taxes and earnings in subsidiaries (2 ) — 681 1,215 — 1,894 Benefit from income taxes — — (7,981 ) (442 ) — (8,423 ) Income (loss) from continuing operations before earnings in subsidiaries (2 ) — 8,662 1,657 — 10,317 Earnings in subsidiaries 9,950 10,301 1,493 — (21,744 ) — Income from continuing operations and earnings in subsidiaries 9,948 10,301 10,155 1,657 (21,744 ) 10,317 Loss from discontinued operations, net of income taxes — — (2 ) (16 ) — (18 ) Net income 9,948 10,301 10,153 1,641 (21,744 ) 10,299 Net income attributable to noncontrolling interest — 351 — — — 351 Net income attributable to common stock $ 9,948 $ 9,950 $ 10,153 $ 1,641 $ (21,744 ) $ 9,948 Net income $ 9,948 $ 10,301 $ 10,153 $ 1,641 $ (21,744 ) $ 10,299 Other comprehensive income — — — 1 — 1 Comprehensive income 9,948 10,301 10,153 1,642 (21,744 ) 10,300 Comprehensive income attributable to noncontrolling interest — 351 — — — 351 Comprehensive income attributable to common stock $ 9,948 $ 9,950 $ 10,153 $ 1,642 $ (21,744 ) $ 9,949 Condensed Consolidating Statements of Cash Flows Two Fiscal Quarters Ended May 5, 2019 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Cash flows from operating activities: Net income $ 1,162 $ 2,003 $ 2,069 $ 1,460 $ (5,532 ) $ 1,162 Adjustments to reconcile net income to net cash provided by (used in) operating activities (1,378 ) (2,003 ) (2,895 ) 4,381 5,532 3,637 Net cash provided by (used in) operating activities (216 ) — (826 ) 5,841 — 4,799 Cash flows from investing activities: Net change in intercompany loans 800 — (309 ) (5,737 ) 5,246 — Acquisitions of businesses, net of cash acquired (17,865 ) — — 1,838 — (16,027 ) Proceeds from sales of businesses — — — 957 — 957 Purchases of property, plant and equipment — — (86 ) (146 ) 8 (224 ) Proceeds from disposals of property, plant and equipment — — 8 — (8 ) — Purchases of investments (5 ) — — — — (5 ) Proceeds from sales of investments — — — 3 — 3 Other — — — (3 ) — (3 ) Net cash used in investing activities (17,070 ) — (387 ) (3,088 ) 5,246 (15,299 ) Cash flows from financing activities: Dividend and distribution payments (2,124 ) — — — — (2,124 ) Net intercompany borrowings 6,050 — (68 ) (736 ) (5,246 ) — Proceeds from long-term borrowings 28,793 — — — — 28,793 Repayment of debt (12,000 ) — — — — (12,000 ) Other borrowings 997 — — 578 — 1,575 Payment of debt issuance costs (46 ) — — — — (46 ) Repurchases of common stock - repurchase program (4,266 ) — — — — (4,266 ) Issuance of common stock 183 — — — — 183 Shares repurchased for tax withholdings on vesting of equity awards — — (290 ) (287 ) — (577 ) Other — — — (2 ) — (2 ) Net cash provided by (used in) financing activities 17,587 — (358 ) (447 ) (5,246 ) 11,536 Net change in cash and cash equivalents 301 — (1,571 ) 2,306 — 1,036 Cash and cash equivalents at beginning of period — — 2,461 1,831 — 4,292 Cash and cash equivalents at end of period $ 301 $ — $ 890 $ 4,137 $ — $ 5,328 Condensed Consolidating Statements of Cash Flows Two Fiscal Quarters Ended May 6, 2018 Parent Guarantor Subsidiary Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Cash flows from operating activities: Net income $ 9,948 $ 10,301 $ 10,153 $ 1,641 $ (21,744 ) $ 10,299 Adjustments to reconcile net income to net cash provided by (used in) operating activities (9,611 ) (10,301 ) (10,518 ) 2,156 21,973 (6,301 ) Net cash provided by (used in) operating activities 337 — (365 ) 3,797 229 3,998 Cash flows from investing activities: Intercompany contributions paid — — (9,099 ) (3,002 ) 12,101 — Distributions received from subsidiaries — — — 1,521 (1,521 ) — Net change in intercompany loans — — 8,346 2,154 (10,500 ) — Acquisitions of businesses, net of cash acquired — — — (4,786 ) — (4,786 ) Proceeds from sales of businesses — — — 782 — 782 Purchases of property, plant and equipment — — (114 ) (295 ) — (409 ) Proceeds from disposals of property, plant and equipment — — 1 237 — 238 Purchases of investments — — (50 ) (199 ) — (249 ) Proceeds from sales of investments — — 54 — — 54 Other — — — (12 ) — (12 ) Net cash used in investing activities — — (862 ) (3,600 ) 80 (4,382 ) Cash flows from financing activities: Intercompany contributions received — — 3,231 9,099 (12,330 ) — Net intercompany borrowings — — (2,125 ) (8,375 ) 10,500 — Repayment of debt — — — (856 ) — (856 ) Dividend and distribution payments — — (1,521 ) (1,521 ) 1,521 (1,521 ) Repurchases of common stock - repurchase program (347 ) — — — — (347 ) Shares repurchased for tax withholdings on vesting of equity awards — — — (2 ) — (2 ) Issuance of common stock 10 — — 104 — 114 Other — — — (21 ) — (21 ) Net cash used in financing activities (337 ) — (415 ) (1,572 ) (309 ) (2,633 ) Net change in cash and cash equivalents — — (1,642 ) (1,375 ) — (3,017 ) Cash and cash equivalents at beginning of period — — 7,555 3,649 — 11,204 Cash and cash equivalents at end of period $ — $ — $ 5,913 $ 2,274 $ — $ 8,187 |