|
x
|
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
75-0289970
|
(State of Incorporation)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
12500 TI Boulevard, Dallas, Texas
|
|
75243
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Title of each class
|
|
Name of each exchange on which registered
|
Common Stock, par value $1.00
|
|
The NASDAQ Global Select Market
|
Large accelerated filer
x
|
Accelerated filer
¨
|
Non-accelerated filer
¨
|
Smaller reporting company
¨
|
|
•
|
Revenue from our smaller product lines, such as DLP
®
products (primarily used in projectors to create high-definition images), certain custom semiconductors known as application-specific integrated circuits (ASICs) and calculators.
|
•
|
Revenue from our baseband products and from our OMAP
TM
applications processors and connectivity products sold into smartphones and consumer tablets. Our exit from these “legacy wireless products” was completed in 2013.
|
•
|
Royalties received for our patented technology that we license to other electronics companies.
|
Market
|
Sectors
|
||
Industrial
(31% of TI revenue)
|
Factory automation and control
Medical/healthcare/fitness
Building automation
Smart grid and energy
Test and measurement
Motor drives
Display
Space/avionics/defense
Appliance
Other power delivery
Electronic point of sale
Lighting
Industrial transportation
Other (education, toys, musical instruments, etc.)
No single sector in this market accounted for more than 4% of TI revenue.
|
||
Automotive
(13% of TI revenue)
|
Infotainment and cluster
Passive safety
Body
Advanced driver assistance systems (ADAS)
Hybrid/electric vehicle and powertrain
No single sector in this market accounted for more than 5% of TI revenue.
|
||
Personal electronics
(29% of TI revenue)
|
Mobile phones
Personal and notebook computers
TV/set-top box/audio
Storage
Printers and other peripherals
Tablets
Wearables (non-medical)
Gaming
No single sector in this market accounted for more than 9% of TI revenue.
|
||
Communications equipment
(17% of TI revenue)
|
Wireless infrastructure
Telecom infrastructure
Enterprise switching
Residential gateway
No single sector in this market accounted for more than 10% of TI revenue.
|
||
Enterprise systems
(6% of TI revenue)
|
Projectors
Servers
Multi-function printers
High-performance computing
Thin client
No single sector in this market accounted for more than 4% of TI revenue.
|
||
Other (calculators, royalties and other)
(4% of TI revenue)
|
|
|
|
Name
|
Age
|
Position
|
Stephen A. Anderson
|
53
|
Senior Vice President
|
Brian T. Crutcher
|
42
|
Executive Vice President
|
R. Gregory Delagi
|
52
|
Senior Vice President
|
Joseph F. Hubach*
|
57
|
Senior Vice President, Secretary and General Counsel
|
Kevin P. March
|
57
|
Senior Vice President and Chief Financial Officer
|
Kevin J. Ritchie
|
58
|
Senior Vice President
|
Richard K. Templeton
|
56
|
Director; Chairman of the Board; President and Chief Executive Officer
|
Cynthia Hoff Trochu*
|
51
|
Elected to become Senior Vice President, Secretary and General Counsel
|
Teresa L. West
|
54
|
Senior Vice President
|
Darla H. Whitaker
|
49
|
Senior Vice President
|
Bing Xie
|
47
|
Senior Vice President
|
|
Analog
|
Embedded Processing
|
Dallas, Texas
|
X
|
X
|
Sherman, Texas
|
X
|
|
Houston, Texas
|
|
X
|
Tucson, Arizona
(1)
|
X
|
|
Santa Clara, California
|
X
|
|
South Portland, Maine
|
X
|
|
Aguascalientes, Mexico
(1)
|
X
|
|
Aizu, Japan
|
X
|
X
|
Miho, Japan
|
X
|
X
|
Tokyo, Japan
(1)
|
X
|
|
Chengdu, China
(2)
|
X
|
|
Shanghai, China
(1)
|
X
|
X
|
Bangalore, India
(2)
|
X
|
X
|
Kuala Lumpur, Malaysia
(2)
|
X
|
X
|
Melaka, Malaysia
(2)
|
X
|
|
Baguio, Philippines
(2)
|
X
|
X
|
Pampanga (Clark), Philippines
(2)
|
X
|
X
|
Taipei, Taiwan
(2)
|
X
|
X
|
Freising, Germany
|
X
|
X
|
Greenock, Scotland
|
X
|
|
ITEM 5.
|
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
|
|
|
|
|
Quarter
|
|||||||||||||||
|
|
|
|
1st
|
|
2nd
|
3rd
|
|
4th
|
||||||||||
Stock prices:
|
|
|
|
|
|
|
|
|
|
||||||||||
2014
|
|
High
|
|
$
|
47.16
|
|
|
$
|
48.47
|
|
|
$
|
49.29
|
|
|
$
|
55.62
|
|
|
|
|
Low
|
|
40.89
|
|
|
44.89
|
|
|
45.67
|
|
|
41.93
|
|
|||||
2013
|
|
High
|
|
|
35.62
|
|
|
|
37.09
|
|
|
|
40.85
|
|
|
|
43.91
|
|
|
|
|
Low
|
|
31.55
|
|
|
33.92
|
|
|
35.05
|
|
|
39.24
|
|
|||||
Dividends paid:
|
|
|
|
|
|
|
|
||||||||||||
2014
|
|
|
|
$
|
0.30
|
|
|
$
|
0.30
|
|
$
|
0.30
|
|
|
$
|
0.34
|
|
||
2013
|
|
|
|
|
0.21
|
|
|
|
0.28
|
|
|
0.28
|
|
|
|
0.30
|
|
|
|
|
|
|
|
Total Number
|
|
|
Approximate
|
||
|
|
|
|
|
|
of Shares
|
|
|
Dollar Value
|
||
|
|
|
|
|
|
Purchased as
|
|
|
of Shares that
|
||
|
|
|
|
|
|
Part of
|
|
|
May Yet Be
|
||
|
Total
|
|
|
|
|
Publicly
|
|
|
Purchased
|
||
|
Number of
|
|
|
Average
|
|
Announced
|
|
|
Under the
|
||
|
Shares
|
|
|
Price Paid
|
|
Plans or
|
|
|
Plans or
|
||
Period
|
Purchased
|
|
|
per Share
|
|
Programs
(1)
|
|
|
Programs
(1)
|
||
October 1, 2014 through October 31, 2014
|
11,317,506
|
|
|
$
|
45.62
|
|
11,317,506
|
|
$
|
3.35
|
billion
|
November 1, 2014 through November 30, 2014
|
2,820,815
|
|
|
|
50.94
|
|
2,820,815
|
|
|
3.21
|
billion
|
December 1, 2014 through December 31, 2014
|
695,093
|
|
|
|
53.71
|
|
695,093
|
|
|
3.17
|
billion
|
Total
|
14,833,414
|
(2)
|
|
$
|
47.01
|
|
14,833,414
|
(2)
|
$
|
3.17
|
billion
(3)
|
(1)
|
All purchases during the quarter were made under the authorization from our board of directors to purchase up to $5.0 billion of additional shares of TI common stock announced on February 21, 2013.
|
(2)
|
All purchases during the quarter were open-market purchases.
|
(3)
|
As of December 31, 2014, this amount consisted of the remaining portion of the $5.0 billion authorized in February 2013. No expiration date has been specified for this authorization.
|
|
|
For Years Ended December 31,
|
||||||||||||||||||
(Millions of dollars, except share and per-share amounts)
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Cash flow data
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash flows from operating activities
|
|
$
|
3,892
|
|
|
$
|
3,384
|
|
|
$
|
3,414
|
|
|
$
|
3,256
|
|
|
$
|
3,820
|
|
Capital expenditures
|
|
385
|
|
|
412
|
|
|
495
|
|
|
816
|
|
|
1,199
|
|
|||||
Free cash flow (a)
|
|
3,507
|
|
|
2,972
|
|
|
2,919
|
|
|
2,440
|
|
|
2,621
|
|
|||||
Dividends paid
|
|
1,323
|
|
|
1,175
|
|
|
819
|
|
|
644
|
|
|
592
|
|
|||||
Stock repurchases
|
|
2,831
|
|
|
2,868
|
|
|
1,800
|
|
|
1,973
|
|
|
2,454
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income statement data
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenue by segment:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Analog
|
|
8,104
|
|
|
7,194
|
|
|
6,998
|
|
|
6,375
|
|
|
5,979
|
|
|||||
Embedded Processing
|
|
2,740
|
|
|
2,450
|
|
|
2,257
|
|
|
2,381
|
|
|
2,359
|
|
|||||
Other
|
|
2,201
|
|
|
2,561
|
|
|
3,570
|
|
|
4,979
|
|
|
5,628
|
|
|||||
Revenue
|
|
13,045
|
|
|
12,205
|
|
|
12,825
|
|
|
13,735
|
|
|
13,966
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Gross profit
|
|
7,427
|
|
|
6,364
|
|
|
6,368
|
|
|
6,772
|
|
|
7,492
|
|
|||||
Operating expenses (R&D and SG&A)
|
|
3,201
|
|
|
3,380
|
|
|
3,681
|
|
|
3,353
|
|
|
3,089
|
|
|||||
Acquisition charges
|
|
330
|
|
|
341
|
|
|
450
|
|
|
315
|
|
|
—
|
|
|||||
Restructuring charges/other
|
|
(51
|
)
|
|
(189
|
)
|
|
264
|
|
|
112
|
|
|
(111
|
)
|
|||||
Operating profit
|
|
3,947
|
|
|
2,832
|
|
|
1,973
|
|
|
2,992
|
|
|
4,514
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
2,821
|
|
|
$
|
2,162
|
|
|
$
|
1,759
|
|
|
$
|
2,236
|
|
|
$
|
3,228
|
|
Net income
|
|
$
|
2,821
|
|
|
$
|
2,162
|
|
|
$
|
1,759
|
|
|
$
|
2,236
|
|
|
$
|
3,228
|
|
Income allocated to RSUs
|
|
(43
|
)
|
|
(36
|
)
|
|
(31
|
)
|
|
(34
|
)
|
|
(44
|
)
|
|||||
Income allocated to common shares for diluted EPS
|
|
$
|
2,778
|
|
|
$
|
2,126
|
|
|
$
|
1,728
|
|
|
$
|
2,202
|
|
|
$
|
3,184
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Average diluted shares outstanding, in millions
|
|
1,080
|
|
|
1,113
|
|
|
1,146
|
|
|
1,171
|
|
|
1,213
|
|
|||||
Diluted earnings per common share
|
|
$
|
2.57
|
|
|
$
|
1.91
|
|
|
$
|
1.51
|
|
|
$
|
1.88
|
|
|
$
|
2.62
|
|
Cash dividends declared per common share
|
|
$
|
1.24
|
|
|
$
|
1.07
|
|
|
$
|
0.72
|
|
|
$
|
0.56
|
|
|
$
|
0.49
|
|
|
|
December 31,
|
||||||||||||||||||
(Millions of dollars, except Other data items)
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
||||||||||
Balance sheet data
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash, cash equivalents and short-term investments
|
|
$
|
3,541
|
|
|
$
|
3,829
|
|
|
$
|
3,965
|
|
|
$
|
2,935
|
|
|
$
|
3,072
|
|
Total assets
|
|
17,722
|
|
|
18,938
|
|
|
20,021
|
|
|
20,497
|
|
|
13,401
|
|
|||||
Current portion of long-term debt and commercial paper borrowings
|
|
1,001
|
|
|
1,000
|
|
|
1,500
|
|
|
1,381
|
|
|
—
|
|
|||||
Long-term debt
|
|
3,641
|
|
|
4,158
|
|
|
4,186
|
|
|
4,211
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other data
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Number of:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Employees
|
|
31,003
|
|
|
32,209
|
|
|
34,151
|
|
|
34,759
|
|
|
28,412
|
|
|||||
Stockholders of record
|
|
16,361
|
|
|
17,213
|
|
|
18,128
|
|
|
19,733
|
|
|
20,525
|
|
•
|
Industry’s broadest portfolio of differentiated analog and embedded processing
semiconductors.
Our customers’ design engineers need at least one, and most times multiple, chips for their systems. The breadth of our portfolio means we can solve more of these needs than can our competitors, which gives us access to more customers and the opportunity to generate more revenue per system. We invest more than $1 billion each year to develop new products for our portfolio.
|
•
|
A strong foundation of manufacturing technology and low-cost production.
We invest in manufacturing technologies that differentiate the features of our semiconductors, and we do most of our own production in-house as opposed to outsourcing it. This ability to directly control our manufacturing helps ensure a consistent supply of products for our customers. We produce billions of semiconductors each year on a mixture of 150-, 200- and 300-millimeter wafers, and we are able to keep costs low for manufacturing facilities and equipment because our analog and much of our embedded processing semiconductors can be made using mature assets that we acquire ahead of demand when their prices are most attractive. In 2014 we produced approximately 25 percent of our Analog semiconductors on 300-millimeter wafers, the industry’s largest wafers, which have a 40 percent cost advantage per unpackaged chip over 200-millimeter wafers. The majority of our future Analog growth will be produced on 300-millimeter wafers, which will be meaningful to the growth of our margins and cash flow over the long term.
|
•
|
Industry’s largest market channels.
Our global sales force is larger than those of our competitors, and the breadth of our portfolio attracts tens of millions of visits to our web site each year where customers often begin their initial product searches and design-in journey. These capabilities combine to provide us unique access to more than 100,000 customers.
|
•
|
Diversity and longevity in our products and in the markets we serve.
Together, the advantages above result in diverse and long-lived positions that deliver high terminal value to our shareholders. Because of the breadth of our portfolio we are not dependent on any single product, and because of the breadth of our markets we are not dependent on any single application or customer. Some of our products generate revenue for decades, which strengthens the return on our investments.
|
•
|
All dollar amounts in the tables are stated in millions of U.S. dollars, except per-share amounts.
|
•
|
When we discuss our results:
|
◦
|
Unless otherwise noted, changes in our revenue are attributable to changes in customer demand, which are evidenced by fluctuations in shipment volumes.
|
◦
|
New products tend not to have a significant impact on our revenue in any given period because we sell such a large number of products.
|
◦
|
From time to time, our revenue and gross profit are affected by changes in demand for higher-priced or lower-priced products, which we refer to as changes in the “mix” of products shipped.
|
◦
|
Because we own much of our manufacturing capacity, a significant portion of our operating cost is fixed. When factory loadings decrease, our fixed costs are spread over reduced output and, absent other circumstances, our profit margins decrease. Conversely, as factory loadings increase, our fixed costs are spread over increased output and, absent other circumstances, our profit margins increase. Increases and decreases in factory loadings tend to correspond to increases and decreases in demand.
|
•
|
Our segments represent groups of similar products that are combined on the basis of similar design and development requirements, product characteristics, manufacturing processes and distribution channels, and how management allocates resources and measures results. See Note 1 to the financial statements for more information regarding our segments.
|
•
|
Our exit from legacy wireless products and the elimination (effective January 1, 2013) of the Wireless segment resulted in changes to our corporate-level expense allocations, which negatively affected Analog and Embedded Processing profitability in the year ended December 31, 2013 and, to a less significant extent, in 2014. We allocate our corporate-level expenses, which are largely fixed, among our product lines in proportion to the operating expenses directly generated by them. Legacy wireless products generated lower operating expenses in 2014 and 2013 than in 2012 because we stopped investing in them. The corporate-level expenses allocated to those products were, therefore, proportionately lower, and the corporate-level expenses allocated to the remaining product lines were proportionately higher. This allocation change affects the profitability of each of our segments, but does not impact operating expense or profitability trends at the consolidated level.
|
|
|
2014
|
|
2013
|
|
Change
|
|||
Revenue
|
|
$
|
8,104
|
|
$
|
7,194
|
|
|
13%
|
Operating profit
|
|
|
2,786
|
|
|
1,859
|
|
|
50%
|
Operating profit % of revenue
|
|
|
34.4%
|
|
|
25.8%
|
|
|
|
|
|
2014
|
|
2013
|
|
Change
|
|||
Revenue
|
|
$
|
2,740
|
|
$
|
2,450
|
|
|
12%
|
Operating profit
|
|
|
384
|
|
|
185
|
|
|
108%
|
Operating profit % of revenue
|
|
|
14.0%
|
|
|
7.6%
|
|
|
|
|
|
2013
|
|
2012
|
|
Change
|
|||
Revenue
|
|
$
|
7,194
|
|
$
|
6,998
|
|
|
3%
|
Operating profit
|
|
|
1,859
|
|
|
1,650
|
|
|
13%
|
Operating profit % of revenue
|
|
|
25.8%
|
|
|
23.6%
|
|
|
|
|
|
2013
|
|
2012
|
|
Change
|
|||
Revenue
|
|
$
|
2,450
|
|
$
|
2,257
|
|
|
9%
|
Operating profit
|
|
|
185
|
|
|
158
|
|
|
17%
|
Operating profit % of revenue
|
|
|
7.6%
|
|
|
7.0%
|
|
|
|
|
|
2013
|
|
2012
|
|
Change
|
|||
Revenue
|
|
$
|
2,561
|
|
$
|
3,570
|
|
|
-28%
|
Operating profit*
|
|
|
788
|
|
|
165
|
|
|
378%
|
Operating profit % of revenue
|
|
|
30.8%
|
|
|
4.6%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*Includes Acquisition charges and Restructuring charges/other
|
|
For Years Ended
|
||||
|
December 31,
|
||||
|
2014
|
|
2013
|
||
Cash flow from operations (GAAP)
|
$
|
3,892
|
|
$
|
3,384
|
Capital expenditures
|
|
(385)
|
|
|
(412)
|
Free cash flow (non-GAAP)
|
$
|
3,507
|
|
$
|
2,972
|
|
|
|
|
|
|
Revenue
|
$
|
13,045
|
|
$
|
12,205
|
|
|
|
|
|
|
Cash flow from operations as a percent of revenue (GAAP)
|
|
30%
|
|
|
28%
|
Free cash flow as a percent of revenue (non-GAAP)
|
|
27%
|
|
|
24%
|
•
|
Investments in mutual funds − includes mutual funds that were selected to generate returns that offset changes in certain liabilities related to deferred compensation arrangements. The mutual funds hold a variety of debt and equity investments.
|
•
|
Investments in venture capital funds − includes investments in limited partnerships (accounted for under either the equity or cost method).
|
•
|
Equity investments − includes non-marketable (non-publicly traded) equity securities.
|
Consolidated financial statements
|
|
Income for each of the three years in the period ended December 31, 2014
|
28
|
Comprehensive income for each of the three years in the period ended December 31, 2014
|
29
|
Balance sheets at December 31, 2014 and 2013
|
30
|
Cash flows for each of the three years in the period ended December 31, 2014
|
31
|
Stockholders’ equity for each of the three years in the period ended December 31, 2014
|
32
|
Notes to financial statements
|
33
|
Report of independent registered public accounting firm
|
67
|
|
|
For Years Ended
December 31,
|
||||||||||
Consolidated Statements of Comprehensive Income
|
|
2014
|
|
2013
|
|
2012
|
||||||
(Millions of dollars)
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
2,821
|
|
|
$
|
2,162
|
|
|
$
|
1,759
|
|
Other comprehensive income (loss)
|
|
|
|
|
|
|
|
|
|
|||
Net actuarial gains (losses) of defined benefit plans:
|
|
|
|
|
|
|
|
|
||||
Adjustment, net of tax benefit (expense) of $25, ($60) and $29
|
|
(46
|
)
|
|
105
|
|
|
(81
|
)
|
|||
Recognized within Net income, net of tax benefit (expense) of ($21), ($37) and ($104)
|
|
42
|
|
|
71
|
|
|
160
|
|
|||
Prior service cost of defined benefit plans:
|
|
|
|
|
|
|
|
|
|
|||
Adjustment, net of tax benefit (expense) of $0, $1 and $1
|
|
(1
|
)
|
|
(3
|
)
|
|
(2
|
)
|
|||
Recognized within Net income, net of tax benefit (expense) of $0, $2 and $0
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|||
Derivative instruments:
|
|
|
|
|
|
|
||||||
Change in fair value, net of tax benefit (expense) of $0, $0 and $1
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|||
Recognized within Net income, net of tax benefit (expense) of ($1), ($1) and $0
|
|
1
|
|
|
1
|
|
|
—
|
|
|||
Available-for-sale investments:
|
|
|
|
|
|
|
|
|
|
|||
Unrealized gains (losses), net of tax benefit (expense) of $0, $0 and ($1)
|
|
—
|
|
|
—
|
|
|
3
|
|
|||
Other comprehensive income (loss), net of taxes
|
|
(4
|
)
|
|
171
|
|
|
77
|
|
|||
Total comprehensive income
|
|
$
|
2,817
|
|
|
$
|
2,333
|
|
|
$
|
1,836
|
|
|
|
December 31,
|
||||||
Consolidated Balance Sheets
|
|
2014
|
|
2013
|
||||
(Millions of dollars, except share amounts)
|
|
|
|
|
||||
Assets
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
1,199
|
|
|
$
|
1,627
|
|
Short-term investments
|
|
2,342
|
|
|
2,202
|
|
||
Accounts receivable, net of allowances of ($12) and ($22)
|
|
1,246
|
|
|
1,203
|
|
||
Raw materials
|
|
101
|
|
|
102
|
|
||
Work in process
|
|
896
|
|
|
919
|
|
||
Finished goods
|
|
787
|
|
|
710
|
|
||
Inventories
|
|
1,784
|
|
|
1,731
|
|
||
Deferred income taxes
|
|
347
|
|
|
393
|
|
||
Prepaid expenses and other current assets
|
|
850
|
|
|
863
|
|
||
Total current assets
|
|
7,768
|
|
|
8,019
|
|
||
Property, plant and equipment at cost
|
|
6,266
|
|
|
6,556
|
|
||
Accumulated depreciation
|
|
(3,426
|
)
|
|
(3,157
|
)
|
||
Property, plant and equipment, net
|
|
2,840
|
|
|
3,399
|
|
||
Long-term investments
|
|
224
|
|
|
216
|
|
||
Goodwill, net
|
|
4,362
|
|
|
4,362
|
|
||
Acquisition-related intangibles, net
|
|
1,902
|
|
|
2,223
|
|
||
Deferred income taxes
|
|
172
|
|
|
207
|
|
||
Capitalized software licenses, net
|
|
83
|
|
|
118
|
|
||
Overfunded retirement plans
|
|
127
|
|
|
130
|
|
||
Other assets
|
|
244
|
|
|
264
|
|
||
Total assets
|
|
$
|
17,722
|
|
|
$
|
18,938
|
|
|
|
|
|
|
||||
Liabilities and stockholders’ equity
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
|
||
Current portion of long-term debt
|
|
$
|
1,001
|
|
|
$
|
1,000
|
|
Accounts payable
|
|
437
|
|
|
422
|
|
||
Accrued compensation
|
|
651
|
|
|
554
|
|
||
Income taxes payable
|
|
71
|
|
|
119
|
|
||
Deferred income taxes
|
|
4
|
|
|
1
|
|
||
Accrued expenses and other liabilities
|
|
498
|
|
|
651
|
|
||
Total current liabilities
|
|
2,662
|
|
|
2,747
|
|
||
Long-term debt
|
|
3,641
|
|
|
4,158
|
|
||
Underfunded retirement plans
|
|
225
|
|
|
216
|
|
||
Deferred income taxes
|
|
399
|
|
|
548
|
|
||
Deferred credits and other liabilities
|
|
405
|
|
|
462
|
|
||
Total liabilities
|
|
7,332
|
|
|
8,131
|
|
||
Stockholders’ equity:
|
|
|
|
|
|
|
||
Preferred stock, $25 par value. Authorized – 10,000,000 shares.
Participating cumulative preferred. None issued.
|
|
—
|
|
|
—
|
|
||
Common stock, $1 par value. Authorized – 2,400,000,000 shares.
Shares issued – 1,740,815,939
|
|
1,741
|
|
|
1,741
|
|
||
Paid-in capital
|
|
1,368
|
|
|
1,211
|
|
||
Retained earnings
|
|
29,653
|
|
|
28,173
|
|
||
Treasury common stock at cost.
Shares: 2014 – 694,189,127; 2013 – 658,012,970
|
|
(21,840
|
)
|
|
(19,790
|
)
|
||
Accumulated other comprehensive income (loss), net of taxes (AOCI)
|
|
(532
|
)
|
|
(528
|
)
|
||
Total stockholders’ equity
|
|
10,390
|
|
|
10,807
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
17,722
|
|
|
$
|
18,938
|
|
|
|
For Years Ended
December 31,
|
||||||||||
Consolidated Statements of Cash Flows
|
|
2014
|
|
2013
|
|
2012
|
||||||
(Millions of dollars)
|
|
|
|
|
|
|
||||||
Cash flows from operating activities
|
|
|
|
|
|
|
||||||
Net income
|
|
$
|
2,821
|
|
|
$
|
2,162
|
|
|
$
|
1,759
|
|
Adjustments to Net income:
|
|
|
|
|
|
|
|
|
|
|||
Depreciation
|
|
850
|
|
|
879
|
|
|
957
|
|
|||
Amortization of acquisition-related intangibles
|
|
321
|
|
|
336
|
|
|
342
|
|
|||
Amortization of capitalized software
|
|
59
|
|
|
82
|
|
|
102
|
|
|||
Stock-based compensation
|
|
277
|
|
|
287
|
|
|
263
|
|
|||
Gains on sales of assets
|
|
(73
|
)
|
|
(6
|
)
|
|
—
|
|
|||
Deferred income taxes
|
|
(61
|
)
|
|
50
|
|
|
130
|
|
|||
Gain on transfer of Japan substitutional pension
|
|
—
|
|
|
—
|
|
|
(144
|
)
|
|||
Increase (decrease) from changes in:
|
|
|
|
|
|
|
|
|
|
|||
Accounts receivable
|
|
(49
|
)
|
|
16
|
|
|
311
|
|
|||
Inventories
|
|
(53
|
)
|
|
26
|
|
|
5
|
|
|||
Prepaid expenses and other current assets
|
|
65
|
|
|
(136
|
)
|
|
162
|
|
|||
Accounts payable and accrued expenses
|
|
(194
|
)
|
|
(284
|
)
|
|
99
|
|
|||
Accrued compensation
|
|
89
|
|
|
18
|
|
|
(82
|
)
|
|||
Income taxes payable
|
|
(81
|
)
|
|
78
|
|
|
(229
|
)
|
|||
Changes in funded status of retirement plans
|
|
(58
|
)
|
|
28
|
|
|
(198
|
)
|
|||
Other
|
|
(21
|
)
|
|
(152
|
)
|
|
(63
|
)
|
|||
Cash flows from operating activities
|
|
3,892
|
|
|
3,384
|
|
|
3,414
|
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from investing activities
|
|
|
|
|
|
|
|
|
|
|||
Capital expenditures
|
|
(385
|
)
|
|
(412
|
)
|
|
(495
|
)
|
|||
Proceeds from asset sales
|
|
142
|
|
|
21
|
|
|
—
|
|
|||
Purchases of short-term investments
|
|
(3,107
|
)
|
|
(3,907
|
)
|
|
(2,802
|
)
|
|||
Proceeds from short-term investments
|
|
2,966
|
|
|
4,249
|
|
|
2,198
|
|
|||
Other
|
|
7
|
|
|
46
|
|
|
60
|
|
|||
Cash flows from investing activities
|
|
(377
|
)
|
|
(3
|
)
|
|
(1,039
|
)
|
|||
|
|
|
|
|
|
|
||||||
Cash flows from financing activities
|
|
|
|
|
|
|
|
|
|
|||
Proceeds from issuance of long-term debt
|
|
498
|
|
|
986
|
|
|
1,492
|
|
|||
Repayment of debt and commercial paper borrowings
|
|
(1,000
|
)
|
|
(1,500
|
)
|
|
(1,375
|
)
|
|||
Dividends paid
|
|
(1,323
|
)
|
|
(1,175
|
)
|
|
(819
|
)
|
|||
Stock repurchases
|
|
(2,831
|
)
|
|
(2,868
|
)
|
|
(1,800
|
)
|
|||
Proceeds from common stock transactions
|
|
616
|
|
|
1,314
|
|
|
523
|
|
|||
Excess tax benefit from share-based payments
|
|
100
|
|
|
80
|
|
|
38
|
|
|||
Other
|
|
(3
|
)
|
|
(7
|
)
|
|
(10
|
)
|
|||
Cash flows from financing activities
|
|
(3,943
|
)
|
|
(3,170
|
)
|
|
(1,951
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net change in Cash and cash equivalents
|
|
(428
|
)
|
|
211
|
|
|
424
|
|
|||
Cash and cash equivalents at beginning of period
|
|
1,627
|
|
|
1,416
|
|
|
992
|
|
|||
Cash and cash equivalents at end of period
|
|
$
|
1,199
|
|
|
$
|
1,627
|
|
|
$
|
1,416
|
|
|
|
|
|
|
|
|
Consolidated Statements of Stockholders’ Equity
|
|
Common
Stock
|
|
Paid-in
Capital
|
|
Retained
Earnings
|
|
Treasury
Common
Stock
|
|
AOCI
|
||||||||||
(Millions of dollars, except per-share amounts)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance, December 31, 2011
|
|
$
|
1,741
|
|
|
$
|
1,194
|
|
|
$
|
26,278
|
|
|
$
|
(17,485
|
)
|
|
$
|
(776
|
)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
1,759
|
|
|
—
|
|
|
—
|
|
|||||
Dividends declared and paid ($0.72 per share)
|
|
—
|
|
|
—
|
|
|
(819
|
)
|
|
—
|
|
|
—
|
|
|||||
Common stock issued for stock-based awards
|
|
—
|
|
|
(337
|
)
|
|
—
|
|
|
823
|
|
|
—
|
|
|||||
Stock repurchases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,800
|
)
|
|
—
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
263
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Tax impact from exercise of options
|
|
—
|
|
|
56
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other comprehensive income (loss), net of taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
77
|
|
|||||
Dividend equivalents paid on restricted stock units
|
|
—
|
|
|
—
|
|
|
(13
|
)
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2012
|
|
1,741
|
|
|
1,176
|
|
|
27,205
|
|
|
(18,462
|
)
|
|
(699
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
2,162
|
|
|
—
|
|
|
—
|
|
|||||
Dividends declared and paid ($1.07 per share)
|
|
—
|
|
|
—
|
|
|
(1,175
|
)
|
|
—
|
|
|
—
|
|
|||||
Common stock issued for stock-based awards
|
|
—
|
|
|
(273
|
)
|
|
—
|
|
|
1,540
|
|
|
—
|
|
|||||
Stock repurchases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,868
|
)
|
|
—
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
287
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Tax impact from exercise of options
|
|
—
|
|
|
25
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other comprehensive income (loss), net of taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
171
|
|
|||||
Dividend equivalents paid on restricted stock units
|
|
—
|
|
|
—
|
|
|
(19
|
)
|
|
—
|
|
|
—
|
|
|||||
Other
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2013
|
|
1,741
|
|
|
1,211
|
|
|
28,173
|
|
|
(19,790
|
)
|
|
(528
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Net income
|
|
—
|
|
|
—
|
|
|
2,821
|
|
|
—
|
|
|
—
|
|
|||||
Dividends declared and paid ($1.24 per share)
|
|
—
|
|
|
—
|
|
|
(1,323
|
)
|
|
—
|
|
|
—
|
|
|||||
Common stock issued for stock-based awards
|
|
—
|
|
|
(226
|
)
|
|
—
|
|
|
781
|
|
|
—
|
|
|||||
Stock repurchases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,831
|
)
|
|
—
|
|
|||||
Stock-based compensation
|
|
—
|
|
|
277
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Tax impact from exercise of options
|
|
—
|
|
|
110
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other comprehensive income (loss), net of taxes
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|||||
Dividend equivalents paid on restricted stock units
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
|
—
|
|
|||||
Other
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Balance, December 31, 2014
|
|
$
|
1,741
|
|
|
$
|
1,368
|
|
|
$
|
29,653
|
|
|
$
|
(21,840
|
)
|
|
$
|
(532
|
)
|
•
|
Analog
– consists of the following product lines: High Volume Analog & Logic; Power Management; High Performance Analog; and Silicon Valley Analog, which consists primarily of products that we acquired through our purchase of National Semiconductor Corporation (National) in 2011.
|
•
|
Embedded Processing
– consists of the following product lines: Processor, Microcontrollers and Connectivity.
|
|
|
For Years Ended December 31,
|
||||||||||
|
|
2014
|
|
2013
|
|
2012
|
||||||
Revenue:
|
|
|
|
|
|
|
||||||
Analog
|
|
$
|
8,104
|
|
|
$
|
7,194
|
|
|
$
|
6,998
|
|
Embedded Processing
|
|
2,740
|
|
|
2,450
|
|
|