Condensed Consolidating Financial Information | Condensed Consolidating Financial Information Broadcom and BTI, a 100% -owned subsidiary of Broadcom, fully and unconditionally guarantee, jointly and severally, on an unsecured, unsubordinated basis, the senior unsecured notes issued by BRCM and Broadcom Cayman Finance Limited (“Cayman Finance”) in fiscal year 2017 (the “2017 Senior Notes”). Substantially all of the 2017 Senior Notes have been registered with the SEC. During fiscal year 2019, Cayman Finance was merged into BTI, with BTI remaining as the surviving entity. In connection with this merger, BTI remains a guarantor and became co-issuer of the 2017 Senior Notes. We have applied the impacts of the change in guarantors and issuers retrospectively to all periods presented, which resulted in the following column headings in the proceeding tables: • Parent Guarantor (Broadcom) • Subsidiary Issuers (BTI and BRCM) • Non-Guarantor Subsidiaries (our other subsidiaries) The following tables set forth the condensed consolidating financial information for the Parent Guarantor, the Subsidiary Issuers, and the Non-Guarantor Subsidiaries for the periods presented. Investments in subsidiaries are accounted for under the equity method; accordingly, entries necessary to consolidate the Parent 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. Condensed Consolidating Balance Sheets February 2, 2020 Parent Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) ASSETS Current assets: Cash and cash equivalents $ 576 $ 758 $ 5,110 $ — $ 6,444 Trade accounts receivable, net — — 3,651 — 3,651 Inventory — — 944 — 944 Intercompany receivable 3,667 835 145 (4,647 ) — Intercompany loan receivable — 9,996 8,228 (18,224 ) — Other current assets 170 44 856 — 1,070 Total current assets 4,413 11,633 18,934 (22,871 ) 12,109 Long-term assets: Property, plant and equipment, net — 771 1,845 — 2,616 Goodwill — 1,360 42,112 — 43,472 Intangible assets, net — 74 21,391 — 21,465 Investment in subsidiaries 52,576 47,524 — (100,100 ) — Intercompany loan receivable, long-term 8,248 — 932 (9,180 ) — Other long-term assets 23 389 932 — 1,344 Total assets $ 65,260 $ 61,751 $ 86,146 $ (132,151 ) $ 81,006 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 23 $ 56 $ 906 $ — $ 985 Employee compensation and benefits — 90 345 — 435 Current portion of long-term debt 1,550 750 11 — 2,311 Intercompany payable 168 2,784 1,695 (4,647 ) — Intercompany loan payable 11,848 5,271 1,105 (18,224 ) — Other current liabilities 150 75 3,783 — 4,008 Total current liabilities 13,739 9,026 7,845 (22,871 ) 7,739 Long-term liabilities: Long-term debt 27,287 13,987 1,133 — 42,407 Deferred tax liabilities (151 ) (a) (292 ) (a) 1,762 — 1,319 Intercompany loan payable, long-term — 932 8,248 (9,180 ) — Unrecognized tax benefits (11 ) (b) 2,472 836 — 3,297 Other long-term liabilities — 382 1,466 — 1,848 Total liabilities 40,864 26,507 21,290 (32,051 ) 56,610 Preferred stock dividend obligation 28 — — — 28 Total stockholders’ equity 24,368 35,244 64,856 (100,100 ) 24,368 Total liabilities and equity $ 65,260 $ 61,751 $ 86,146 $ (132,151 ) $ 81,006 ________________________________ (a) Amount represents net deferred tax assets that are offset by net deferred tax liabilities on a consolidated basis. (b) Amount represents net unrecognized tax benefit assets that are offset by net unrecognized tax benefit liabilities on a consolidated basis. Condensed Consolidating Balance Sheets November 3, 2019 Parent Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) ASSETS Current assets: Cash and cash equivalents $ 374 $ 613 $ 4,068 $ — $ 5,055 Trade accounts receivable, net — — 3,259 — 3,259 Inventory — — 874 — 874 Intercompany receivable 59 439 35 (533 ) — Intercompany loan receivable — 10,576 9,188 (19,764 ) — Other current assets 58 37 634 — 729 Total current assets 491 11,665 18,058 (20,297 ) 9,917 Long-term assets: Property, plant and equipment, net — 759 1,806 — 2,565 Goodwill — 1,360 35,354 — 36,714 Intangible assets, net — 76 17,478 — 17,554 Investment in subsidiaries 51,558 45,981 — (97,539 ) — Intercompany loan receivable, long-term — — 932 (932 ) — Other long-term assets 25 95 623 — 743 Total assets $ 52,074 $ 59,936 $ 74,251 $ (118,768 ) $ 67,493 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 24 $ 38 $ 793 $ — $ 855 Employee compensation and benefits — 179 462 — 641 Current portion of long-term debt — 2,750 37 — 2,787 Intercompany payable 32 4 497 (533 ) — Intercompany loan payable 13,709 4,935 1,120 (19,764 ) — Other current liabilities 25 186 2,405 — 2,616 Total current liabilities 13,790 8,092 5,314 (20,297 ) 6,899 Long-term liabilities: Long-term debt 13,440 14,731 1,840 — 30,011 Deferred tax liabilities (126 ) (a) (295 ) (a) 1,952 — 1,531 Intercompany loan payable, long-term — 932 — (932 ) — Unrecognized tax benefits — 2,422 847 — 3,269 Other long-term liabilities — 107 706 — 813 Total liabilities 27,104 25,989 10,659 (21,229 ) 42,523 Preferred stock dividend obligation 29 — — — 29 Total stockholders’ equity 24,941 33,947 63,592 (97,539 ) 24,941 Total liabilities and equity $ 52,074 $ 59,936 $ 74,251 $ (118,768 ) $ 67,493 ________________________________ (a) Amount represents net deferred tax assets that are offset by net deferred tax liabilities on a consolidated basis. Condensed Consolidating Statements of Operations and Comprehensive Income Fiscal Quarter Ended February 2, 2020 Parent Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Net revenue: Products $ — $ — $ 4,204 $ — $ 4,204 Subscriptions and services — — 1,654 — 1,654 Intercompany revenue — 405 — (405 ) — Total net revenue — 405 5,858 (405 ) 5,858 Cost of revenue: Cost of products sold — 33 1,426 — 1,459 Cost of subscriptions and services — 5 172 — 177 Intercompany cost of products sold — — 32 (32 ) — Amortization of acquisition-related intangible assets — — 950 — 950 Restructuring charges — — 8 — 8 Total cost of revenue — 38 2,588 (32 ) 2,594 Gross margin — 367 3,270 (373 ) 3,264 Research and development — 482 807 — 1,289 Intercompany operating expense — — 373 (373 ) — Selling, general and administrative 140 76 385 — 601 Amortization of acquisition-related intangible assets — — 603 — 603 Restructuring, impairment and disposal charges — 5 52 — 57 Total operating expenses 140 563 2,220 (373 ) 2,550 Operating income (loss) (140 ) (196 ) 1,050 — 714 Interest expense (247 ) (145 ) (14 ) — (406 ) Intercompany interest expense (66 ) (34 ) (43 ) 143 — Other income (expense), net 3 4 (11 ) — (4 ) Intercompany interest income 33 64 46 (143 ) — Intercompany other income (expense), net 166 — (166 ) — — Income (loss) from continuing operations before income taxes and earnings in subsidiaries (251 ) (307 ) 862 — 304 Provision for (benefit from) income taxes (28 ) 81 (129 ) — (76 ) Income (loss) from continuing operations before earnings in subsidiaries (223 ) (388 ) 991 — 380 Earnings in subsidiaries 608 1,325 — (1,933 ) — Income from continuing operations and earnings in subsidiaries 385 937 991 (1,933 ) 380 Income from discontinued operations, net of income taxes — — 5 — 5 Net income $ 385 $ 937 $ 996 $ (1,933 ) $ 385 Comprehensive income $ 385 $ 937 $ 996 $ (1,933 ) $ 385 Condensed Consolidating Statements of Operations and Comprehensive Income Fiscal Quarter Ended February 3, 2019 Parent Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Net revenue: Products $ — $ — $ 4,639 $ — $ 4,639 Subscriptions and services — — 1,150 — 1,150 Intercompany revenue — 397 — (397 ) — Total net revenue — 397 5,789 (397 ) 5,789 Cost of revenue: Cost of products sold — 31 1,523 — 1,554 Cost of subscriptions and services — 3 135 — 138 Intercompany cost of products sold — — 23 (23 ) — Amortization of acquisition-related intangible assets — — 833 — 833 Restructuring charges — (7 ) 63 — 56 Total cost of revenue — 27 2,577 (23 ) 2,581 Gross margin — 370 3,212 (374 ) 3,208 Research and development — 447 686 — 1,133 Intercompany operating expense — — 374 (374 ) — Selling, general and administrative 52 81 338 — 471 Amortization of acquisition-related intangible assets — — 476 — 476 Restructuring, impairment and disposal charges — 8 565 — 573 Total operating expenses 52 536 2,439 (374 ) 2,653 Operating income (loss) (52 ) (166 ) 773 — 555 Interest expense (175 ) (148 ) (22 ) — (345 ) Intercompany interest expense (86 ) (41 ) (8 ) 135 — Other income (expense), net (1 ) 9 60 — 68 Intercompany interest income — 79 56 (135 ) — Intercompany other income (expense), net 77 — (77 ) — — Income (loss) from continuing operations before income taxes and earnings in subsidiaries (237 ) (267 ) 782 — 278 Benefit from income taxes (24 ) (153 ) (26 ) — (203 ) Income (loss) from continuing operations before earnings in subsidiaries (213 ) (114 ) 808 — 481 Earnings in subsidiaries 684 1,569 — (2,253 ) — Income from continuing operations and earnings in subsidiaries 471 1,455 808 (2,253 ) 481 Loss from discontinued operations, net of income taxes — — (10 ) — (10 ) Net income $ 471 $ 1,455 $ 798 $ (2,253 ) $ 471 Comprehensive income $ 471 $ 1,455 $ 798 $ (2,253 ) $ 471 Condensed Consolidating Statements of Cash Flows Fiscal Quarter Ended February 2, 2020 Parent Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Cash flows from operating activities: Net income $ 385 $ 937 $ 996 $ (1,933 ) $ 385 Adjustments to reconcile net income to net cash provided by (used in) operating activities (4,106 ) 1,166 2,944 1,933 1,937 Net cash provided by (used in) operating activities (3,721 ) 2,103 3,940 — 2,322 Cash flows from investing activities: Net change in intercompany loans (8,248 ) 580 959 6,709 — Acquisitions of businesses, net of cash acquired — — (10,870 ) — (10,870 ) Purchases of property, plant and equipment — (40 ) (69 ) 1 (108 ) Proceeds from disposals of property, plant and equipment — 1 — (1 ) — Other — (4 ) (5 ) — (9 ) Net cash provided by (used in) investing activities (8,248 ) 537 (9,985 ) 6,709 (10,987 ) Cash flows from financing activities: Net intercompany borrowings (1,861 ) 337 8,233 (6,709 ) — Proceeds from long-term borrowings 15,381 — — — 15,381 Repayment of debt (1,000 ) (2,750 ) (787 ) — (4,537 ) Other borrowings, net 991 — (273 ) — 718 Payment of dividends (1,372 ) — — — (1,372 ) Shares repurchased for tax withholdings on vesting of equity awards — (82 ) (87 ) — (169 ) Issuance of common stock 37 — — — 37 Other (5 ) — 1 — (4 ) Net cash provided by (used in) financing activities 12,171 (2,495 ) 7,087 (6,709 ) 10,054 Net change in cash and cash equivalents 202 145 1,042 — 1,389 Cash and cash equivalents at beginning of period 374 613 4,068 — 5,055 Cash and cash equivalents at end of period $ 576 $ 758 $ 5,110 $ — $ 6,444 Condensed Consolidating Statements of Cash Flows Fiscal Quarter Ended February 3, 2019 Parent Guarantor Subsidiary Issuers Non-Guarantor Subsidiaries Eliminations Consolidated Totals (In millions) Cash flows from operating activities: Net income $ 471 $ 1,455 $ 798 $ (2,253 ) $ 471 Adjustments to reconcile net income to net cash provided by (used in) operating activities (561 ) (2,451 ) 2,420 2,253 1,661 Net cash provided by (used in) operating activities (90 ) (996 ) 3,218 — 2,132 Cash flows from investing activities: Net change in intercompany loans 800 (592 ) (3,087 ) 2,879 — Acquisitions of businesses, net of cash acquired (17,865 ) — 1,838 — (16,027 ) Proceeds from sale of business — — 957 — 957 Purchases of property, plant and equipment — (36 ) (71 ) 8 (99 ) Proceeds from disposals of property, plant and equipment — 8 — (8 ) — Other — — (24 ) — (24 ) Net cash used in investing activities (17,065 ) (620 ) (387 ) 2,879 (15,193 ) Cash flows from financing activities: Net intercompany borrowings 3,746 (110 ) (757 ) (2,879 ) — Proceeds from long-term borrowings 17,896 — — — 17,896 Other borrowings, net — — 531 — 531 Payment of dividends (1,067 ) — — — (1,067 ) Repurchases of common stock - repurchase program (3,436 ) — — — (3,436 ) Shares repurchased for tax withholdings on vesting of equity awards — (11 ) (66 ) — (77 ) Issuance of common stock 62 — — — 62 Other (46 ) — (1 ) — (47 ) Net cash provided by (used in) financing activities 17,155 (121 ) (293 ) (2,879 ) 13,862 Net change in cash and cash equivalents — (1,737 ) 2,538 — 801 Cash and cash equivalents at beginning of period — 2,461 1,831 — 4,292 Cash and cash equivalents at end of period $ — $ 724 $ 4,369 $ — $ 5,093 |