FORM 10-K
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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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LAM RESEARCH CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware
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94-2634797
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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4650 Cushing Parkway, Fremont, California
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94538
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Stock, Par Value $0.001 Per Share
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The Nasdaq Stock Market
(Nasdaq Global Select Market)
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Large accelerated filer
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x
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Accelerated filer
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¨
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Emerging growth company
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¨
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Page
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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Item 15.
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Item 1.
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Business
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Market
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Process/Application
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Technology
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Products
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Deposition
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Metal Films
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Electrochemical Deposition (“ECD”) (Copper & Other)
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SABRE
®
family
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Chemical Vapor Deposition (“CVD”)
Atomic Layer Deposition (“ALD”)
(Tungsten)
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ALTUS
®
family
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Dielectric Films
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Plasma-enhanced CVD (“PECVD”)
ALD
Gapfill High-Density Plasma CVD (“HDP-CVD”)
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VECTOR
®
family
Striker
®
family
SPEED
®
family
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Film Treatment
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Ultraviolet Thermal Processing (“ULTP”)
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SOLA
®
family
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Etch
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Conductor Etch
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Reactive Ion Etch
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Kiyo
®
family,
Versys
®
Metal family
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Dielectric Etch
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Reactive Ion Etch
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Flex
TM
family
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Through-silicon Via (“TSV”) Etch
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Deep Reactive Ion Etch
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Syndion
®
family
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Clean
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Wafer Cleaning
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Wet Clean
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EOS
®
, DV-Prime
®
,
Da Vinci
®
, SP Series
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Bevel Cleaning
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Dry Plasma Clean
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Coronus
®
family
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Mass Metrology
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Deposition, Etch, Clean
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Sub-milligram Mass Measurement
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Metryx
®
Family
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Year Ended
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||||||||||
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June 24,
2018 |
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June 25,
2017 |
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June 26,
2016 |
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(in thousands)
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Korea
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$
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3,832,798
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$
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2,480,329
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$
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1,057,331
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Japan
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1,882,799
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1,041,969
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983,821
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China
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1,784,436
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1,023,195
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1,039,951
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Taiwan
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1,397,978
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2,095,669
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1,485,037
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United States
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820,438
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629,937
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495,123
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Southeast Asia
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781,360
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401,877
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605,236
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Europe
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577,189
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340,644
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219,394
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Total revenue
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$
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11,076,998
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$
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8,013,620
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$
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5,885,893
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Name
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Age
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Title
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Martin B. Anstice
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51
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Chief Executive Officer
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Timothy M. Archer
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51
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President and Chief Operating Officer
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Douglas R. Bettinger
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51
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Executive Vice President, Chief Financial Officer, and Chief Accounting Officer
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Richard A. Gottscho
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66
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Executive Vice President, Corporate Chief Technology Officer
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Kevin D. Jennings
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53
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Senior Vice President, Global Operations
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Patrick J. Lord
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52
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Senior Vice President and General Manager, CSBG
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Scott G. Meikle
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56
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Senior Vice President, Global Customer Operations
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Sarah A. O’Dowd
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68
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Senior Vice President, Chief Legal Officer and Secretary
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Vahid Vahedi
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52
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Senior Vice President and General Manager, Etch Business Unit
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Sesha Varadarajan
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43
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Senior Vice President and General Manager, Deposition Business Unit
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Item 1A.
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Risk Factors
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•
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a decline in demand for our products or services;
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•
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an increase in reserves on accounts receivable due to our customers’ inability to pay us;
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•
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an increase in reserves on inventory balances due to excess or obsolete inventory as a result of our inability to sell such inventory;
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•
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valuation allowances on deferred tax assets;
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restructuring charges;
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asset impairments including the potential impairment of goodwill and other intangible assets;
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•
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a decline in the value of our investments;
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exposure to claims from our suppliers for payment on inventory that is ordered in anticipation of customer purchases that do not come to fruition;
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a decline in the value of certain facilities we lease to less than our residual value guarantee with the lessor; and
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challenges maintaining reliable and uninterrupted sources of supply.
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economic conditions in the electronics and semiconductor industries in general and specifically the semiconductor equipment industry;
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the size and timing of orders from customers;
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consolidation of the customer base, which may result in the investment decisions of one customer or market having a significant effect on demand for our products or services;
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•
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procurement shortages;
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the failure of our suppliers or outsource providers to perform their obligations in a manner consistent with our expectations;
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manufacturing difficulties;
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•
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customer cancellations or delays in shipments, installations, and/or customer acceptances;
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the extent that customers continue to purchase and use our products and services in their business;
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our customers’ reuse of existing and installed products, to the extent that such reuse decreases their need to purchase new products or services;
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changes in average selling prices, customer mix, and product mix;
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our ability to develop, introduce, and market new, enhanced, and competitive products in a timely manner;
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our competitors’ introduction of new products;
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legal or technical challenges to our products and technologies;
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transportation, communication, demand, information technology, or supply disruptions based on factors outside our control, such as strikes, acts of God, wars, terrorist activities, and natural or man-made disasters;
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legal, tax, accounting, or regulatory changes (including but not limited to change in import/export regulations and tariffs) or changes in the interpretation or enforcement of existing requirements;
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changes in our estimated effective tax rate;
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foreign currency exchange rate fluctuations; and
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the dilutive impact of our Convertible Notes (as defined below) and related warrants on our earnings per share.
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risk associated with any inability to satisfy our obligations;
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a portion of our cash flows that may have to be dedicated to interest and principal payments and may not be available for operations, working capital, capital expenditures, expansion, acquisitions, or general corporate or other purposes; and
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•
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impairing our ability to obtain additional financing in the future.
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incur additional debt, assume obligations in connection with letters of credit, or issue guarantees;
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create liens;
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enter into transactions with our affiliates;
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sell certain assets; and
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merge or consolidate with any person.
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a decline in demand for even a limited number of our products,
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•
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a failure to achieve continued market acceptance of our key products,
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•
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export restrictions or other regulatory or legislative actions that could limit our ability to sell those products to key customers or customers within certain markets,
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an improved version of products being offered by a competitor in the markets in which we participate,
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increased pressure from competitors that offer broader product lines,
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technological changes that we are unable to address with our products, or
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a failure to release new or enhanced versions of our products on a timely basis.
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•
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trade balance issues;
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•
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tariffs and other barriers;
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•
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developing customers and/or suppliers, whom may have limited access to capital resources.
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•
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global or national economic and political conditions;
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changes in currency controls;
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•
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differences in the enforcement of intellectual property and contract rights in varying jurisdictions;
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our ability to respond to customer and foreign government demands for locally sourced systems, spare parts, and services and develop the necessary relationships with local suppliers;
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compliance with U.S. and international laws and regulations affecting foreign operations, including U.S. and international trade restrictions and sanctions, anti-bribery, anti-corruption, environmental, tax, and labor laws;
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fluctuations in interest and foreign currency exchange rates;
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the need for technical support resources in different locations; and
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•
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our ability to secure and retain qualified people, and effectively manage people, in all necessary
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•
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Loss of (or inability to access, e.g. through ransomware) confidential and/or sensitive information including intellectual property stored on these critical information systems or transmitted to or from those systems;
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The disruption of the proper function of our products, services and/or operations;
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•
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The failure of our or our customers’ manufacturing processes;
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•
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Errors in the output of our work or our customers’ work;
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•
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The loss or public exposure of the personal information of our employees or customers;
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•
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The public release of customer orders, financial and business plans, and operational results;
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•
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Exposure to claims from third parties who are adversely impacted by such incidents;
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Misappropriation or theft of Company, customer, supplier, or other’s assets or resources, and costs associated therewith;
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•
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Diminution in the value of Lam's investment in research, development and engineering; or
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•
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Our failure to meet, or violation of, regulatory or other legal obligations, such as the timely publication or filing of financial statements, tax information and other required communications.
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•
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general market, semiconductor, or semiconductor equipment industry conditions;
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•
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economic or political events, trends, and unexpected developments occurring nationally, globally, or in any of our key sales regions;
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•
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variations in our quarterly operating results and financial condition, including our liquidity;
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•
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variations in our revenues, earnings, or other business and financial metrics from forecasts by us or securities analysts or from those experienced by other companies in our industry;
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•
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announcements of restructurings, reductions in force, departure of key employees, and/or consolidations of operations;
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•
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government regulations;
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•
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developments in, or claims relating to, patent or other proprietary rights;
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•
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technological innovations and the introduction of new products by us or our competitors;
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•
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commercial success or failure of our new and existing products;
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•
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disruptions of relationships with key customers or suppliers; or
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•
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dilutive impacts of our Convertible Notes and related warrants.
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Item 1B.
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Unresolved Staff Comments
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Item 2.
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Properties
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Item 3.
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Legal Proceedings
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Item 4.
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Mine Safety Disclosures
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Item 5.
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Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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2018
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||||||||||
Dividend
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Stock Price
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|||||||||
Declared
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High
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Low
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|||||||
First quarter
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$
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0.45
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$
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178.18
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$
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139.24
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Second quarter
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$
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0.50
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$
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219.70
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$
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167.52
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Third quarter
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$
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0.50
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$
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234.88
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$
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156.83
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Fourth quarter
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$
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1.10
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$
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219.46
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$
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170.51
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2017
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||||||||||
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Dividend
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Stock Price
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||||||||
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Declared
|
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High
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Low
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||||||
First quarter
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$
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0.30
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$
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95.77
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$
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79.15
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Second quarter
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$
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0.45
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$
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108.60
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$
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90.56
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Third quarter
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$
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0.45
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$
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129.35
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$
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105.30
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Fourth quarter
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$
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0.45
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$
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167.05
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$
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124.91
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Period
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Total Number
of Shares
Repurchased
(1)
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Average
Price Paid
per Share
(2)
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Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
|
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Amount
Available
Under
Repurchase
Program
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||||||
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(in thousands, except per share data)
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||||||||||||
Available balance as of June 25, 2017
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$
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282,141
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||||
Quarter ended September 24, 2017
|
1,790
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|
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$
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158.40
|
|
|
1,779
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|
|
124,203
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Board authorization, $2.0 billion increase, November 2017
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2,124,203
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|||||
Quarter ended December 24, 2017
|
3,806
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$
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194.99
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|
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3,709
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|
|
1,034,459
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Board authorization, $2.0 billion increase, March 2018
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3,034,459
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|||||
Quarter ended March 25, 2018
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1,470
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$
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180.03
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1,019
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3,034,459
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March 26, 2018 - April 22, 2018
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1,151
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$
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193.37
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1,144
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3,003,614
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April 23, 2018 - May 20, 2018
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4,923
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$
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190.88
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|
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4,917
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|
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1,733,638
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May 21, 2018 - June 24, 2018
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1,646
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$
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184.37
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1,641
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1,733,638
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Total
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14,786
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|
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$
|
181.16
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|
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14,209
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$
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1,733,638
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(1)
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In addition to shares repurchased under the Board-authorized repurchase program, we acquired
577 thousand
shares at a total cost of
$104.9 million
which we withheld through net share settlements to cover minimum tax withholding obligations upon the vesting of restricted stock unit awards granted under our equity compensation plans. The shares retained through these net share settlements are not a part of the Board-authorized repurchase program, but instead are authorized under our equity compensation plans.
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(2)
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Average price paid per share excludes effect of accelerated share repurchases, see additional disclosure above regarding our accelerated share repurchase activity during the fiscal year.
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COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN*
|
|||
|
Among Lam Research Corporation, the Nasdaq Composite Index, the S&P 500 Index, and the Philadelphia Semiconductor Index
|
|
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6/13
|
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6/14
|
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6/15
|
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6/16
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6/17
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6/18
|
||||||
Lam Research Corporation
|
100.00
|
|
|
152.83
|
|
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185.93
|
|
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195.17
|
|
|
333.05
|
|
|
412.46
|
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Nasdaq Composite Index
|
100.00
|
|
|
132.45
|
|
|
151.00
|
|
|
148.88
|
|
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189.66
|
|
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233.12
|
|
S&P 500 Index
|
100.00
|
|
|
124.61
|
|
|
133.86
|
|
|
139.20
|
|
|
164.11
|
|
|
187.70
|
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Philadelphia Semiconductor Sector Index
|
100.00
|
|
|
134.53
|
|
|
138.83
|
|
|
150.22
|
|
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208.31
|
|
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271.06
|
|
Item 6.
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Selected Financial Data
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Year Ended
|
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||||||||||||||||||
June 24,
2018 |
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June 25,
2017 |
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June 26,
2016 |
|
June 28,
2015 |
|
June 29,
2014 |
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|||||||||||
|
(in thousands, except per share data)
|
|
||||||||||||||||||
OPERATIONS:
|
|
|
|
|
|
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|
|
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|
||||||||||
Revenue
|
$
|
11,076,998
|
|
|
$
|
8,013,620
|
|
|
$
|
5,885,893
|
|
|
$
|
5,259,312
|
|
|
$
|
4,607,309
|
|
|
Gross margin
|
5,165,032
|
|
|
3,603,359
|
|
|
2,618,922
|
|
|
2,284,336
|
|
|
2,007,481
|
|
|
|||||
Goodwill impairment
(1)
|
—
|
|
|
—
|
|
|
—
|
|
|
79,444
|
|
|
—
|
|
|
|||||
Operating income
|
3,213,299
|
|
|
1,902,132
|
|
|
1,074,256
|
|
|
788,039
|
|
|
677,669
|
|
|
|||||
Net income
|
2,380,681
|
|
|
1,697,763
|
|
|
914,049
|
|
|
655,577
|
|
|
632,289
|
|
|
|||||
Net income per share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Basic
|
$
|
14.73
|
|
|
$
|
10.47
|
|
|
$
|
5.75
|
|
|
$
|
4.11
|
|
|
$
|
3.84
|
|
|
Diluted
|
$
|
13.17
|
|
|
$
|
9.24
|
|
|
$
|
5.22
|
|
|
$
|
3.70
|
|
|
$
|
3.62
|
|
|
Cash dividends declared per common share
|
$
|
2.55
|
|
|
$
|
1.65
|
|
|
$
|
1.20
|
|
|
$
|
0.84
|
|
|
$
|
0.18
|
|
|
BALANCE SHEET:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
|
$
|
5,999,603
|
|
|
$
|
6,192,383
|
|
|
$
|
6,795,109
|
|
|
$
|
3,639,488
|
|
|
$
|
3,201,661
|
|
|
Total assets
|
12,479,478
|
|
|
12,122,765
|
|
|
12,264,315
|
|
(2)
|
9,358,904
|
|
(2)
|
7,986,998
|
|
(2)
|
|||||
Long-term obligations, less current portion
|
2,749,127
|
|
|
2,185,338
|
|
|
3,744,205
|
|
(2)
|
1,386,536
|
|
(2)
|
1,191,913
|
|
(2)
|
|||||
Current portion of long-term debt and capital leases
|
610,030
|
|
|
908,439
|
|
|
947,733
|
|
(2)
|
1,355,705
|
|
(2)
|
518,267
|
|
|
(1)
|
Goodwill impairment analysis during fiscal year 2015 resulted in a non-cash impairment charge to our Clean reporting unit, extinguishing the goodwill ascribed to the reporting unit.
|
(2)
|
Adjusted for effects of retrospective implementation of ASU 2015-3 in the first quarter of fiscal 2017.
|
|
Three Months Ended
(1)
|
||||||||||||||
June 24,
2018 |
|
March 25,
2018 |
|
December 24,
2017 |
|
September 24,
2017 |
|||||||||
|
unaudited
(in thousands, except per share data)
|
||||||||||||||
QUARTERLY FISCAL YEAR 2018:
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
3,125,928
|
|
|
$
|
2,892,115
|
|
|
$
|
2,580,815
|
|
|
$
|
2,478,140
|
|
Gross margin
|
1,479,408
|
|
|
1,330,714
|
|
|
1,205,567
|
|
|
1,149,343
|
|
||||
Operating income
|
955,195
|
|
|
827,511
|
|
|
737,371
|
|
|
693,222
|
|
||||
Net income (loss)
|
1,021,146
|
|
(2)
|
778,800
|
|
|
(9,955
|
)
|
(2)
|
590,690
|
|
||||
Net income (loss) per share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
6.35
|
|
|
$
|
4.80
|
|
|
$
|
(0.06
|
)
|
(2)
|
$
|
3.64
|
|
Diluted
|
$
|
5.82
|
|
|
$
|
4.33
|
|
|
$
|
(0.06
|
)
|
(2)
|
$
|
3.21
|
|
Number of shares used in per share calculations:
|
|
|
|
|
|
|
|
||||||||
Basic
|
160,916
|
|
|
162,378
|
|
|
161,135
|
|
|
162,141
|
|
||||
Diluted
|
175,432
|
|
|
179,779
|
|
|
161,135
|
|
|
183,880
|
|
|
Three Months Ended
(1)
|
||||||||||||||
June 25,
2017 |
|
March 26,
2017 |
|
December 25,
2016 |
|
September 25,
2016 |
|||||||||
|
unaudited
(in thousands, except per share data)
|
||||||||||||||
QUARTERLY FISCAL YEAR 2017:
|
|
|
|
|
|
|
|
||||||||
Revenue
|
$
|
2,344,907
|
|
|
$
|
2,153,995
|
|
|
$
|
1,882,299
|
|
|
$
|
1,632,419
|
|
Gross margin
|
1,068,961
|
|
|
971,404
|
|
|
846,797
|
|
|
716,197
|
|
||||
Operating income
|
607,939
|
|
|
538,418
|
|
|
439,828
|
|
|
315,947
|
|
||||
Net income
|
526,424
|
|
|
574,713
|
|
|
332,791
|
|
|
263,835
|
|
||||
Net income per share
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
3.25
|
|
|
$
|
3.52
|
|
|
$
|
2.05
|
|
|
$
|
1.64
|
|
Diluted
|
$
|
2.82
|
|
|
$
|
3.10
|
|
|
$
|
1.81
|
|
|
$
|
1.47
|
|
Number of shares used in per share calculations:
|
|
|
|
|
|
|
|
||||||||
Basic
|
162,213
|
|
|
163,408
|
|
|
162,659
|
|
|
160,607
|
|
||||
Diluted
|
186,427
|
|
|
185,094
|
|
|
183,543
|
|
|
180,017
|
|
(1)
|
Our reporting period is a 52/53-week fiscal year. The fiscal years ended
June 24, 2018
, and
June 25, 2017
, included 52 weeks. All quarters presented above included 13 weeks.
|
(2)
|
The comparability of our quarter ended December 24, 2017 was affected by a $757 million provisional charge associated with the December 2017 U.S. tax reform. During the quarter ended June 24, 2018, $116 million of this provisional charge was reversed.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
Year Ended
|
|
Change
|
||||||||||||||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|
FY18 vs. FY17
|
|
FY17 vs. FY16
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands, except per share data and percentages)
|
||||||||||||||||||||||||
Revenue
|
$
|
11,076,998
|
|
|
$
|
8,013,620
|
|
|
$
|
5,885,893
|
|
|
$
|
3,063,378
|
|
|
38.2
|
%
|
|
$
|
2,127,727
|
|
|
36.1
|
%
|
Gross margin
|
$
|
5,165,032
|
|
|
$
|
3,603,359
|
|
|
$
|
2,618,922
|
|
|
$
|
1,561,673
|
|
|
43.3
|
%
|
|
$
|
984,437
|
|
|
37.6
|
%
|
Gross margin as a percent of total revenue
|
46.6
|
%
|
|
45.0
|
%
|
|
44.5
|
%
|
|
1.6%
|
|
0.5%
|
|||||||||||||
Total operating expenses
|
$
|
1,951,733
|
|
|
$
|
1,701,227
|
|
|
$
|
1,544,666
|
|
|
$
|
250,506
|
|
|
14.7
|
%
|
|
$
|
156,561
|
|
|
10.1
|
%
|
Net income
|
$
|
2,380,681
|
|
|
$
|
1,697,763
|
|
|
$
|
914,049
|
|
|
$
|
682,918
|
|
|
40.2
|
%
|
|
$
|
783,714
|
|
|
85.7
|
%
|
Net income per diluted share
|
$
|
13.17
|
|
|
$
|
9.24
|
|
|
$
|
5.22
|
|
|
$
|
3.93
|
|
|
42.5
|
%
|
|
$
|
4.02
|
|
|
77.0
|
%
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
Shipments (in millions)
|
$
|
11,176
|
|
|
$
|
8,586
|
|
|
$
|
5,901
|
|
Korea
|
33
|
%
|
|
32
|
%
|
|
17
|
%
|
|||
Japan
|
19
|
%
|
|
15
|
%
|
|
16
|
%
|
|||
China
|
16
|
%
|
|
13
|
%
|
|
20
|
%
|
|||
Taiwan
|
13
|
%
|
|
24
|
%
|
|
25
|
%
|
|||
United States
|
7
|
%
|
|
8
|
%
|
|
8
|
%
|
|||
Southeast Asia
|
7
|
%
|
|
4
|
%
|
|
11
|
%
|
|||
Europe
|
5
|
%
|
|
4
|
%
|
|
3
|
%
|
|
Year Ended
|
|||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||
Memory
|
78
|
%
|
|
67
|
%
|
|
68
|
%
|
Foundry
|
14
|
%
|
|
27
|
%
|
|
23
|
%
|
Logic/integrated device manufacturing
|
8
|
%
|
|
6
|
%
|
|
9
|
%
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
Revenue (in millions)
|
$
|
11,077
|
|
|
$
|
8,014
|
|
|
$
|
5,886
|
|
Korea
|
35
|
%
|
|
31
|
%
|
|
18
|
%
|
|||
Japan
|
17
|
%
|
|
13
|
%
|
|
17
|
%
|
|||
China
|
16
|
%
|
|
13
|
%
|
|
18
|
%
|
|||
Taiwan
|
13
|
%
|
|
26
|
%
|
|
25
|
%
|
|||
United States
|
7
|
%
|
|
8
|
%
|
|
8
|
%
|
|||
Southeast Asia
|
7
|
%
|
|
5
|
%
|
|
10
|
%
|
|||
Europe
|
5
|
%
|
|
4
|
%
|
|
4
|
%
|
|
Year Ended
|
|
Change
|
||||||||||||||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
FY18 vs. FY17
|
|
FY17 vs. FY16
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands, except percentages)
|
||||||||||||||||||||||||
Research & development
|
$
|
1,189,514
|
|
|
$
|
1,033,742
|
|
|
$
|
913,712
|
|
|
$
|
155,772
|
|
|
15.1
|
%
|
|
$
|
120,030
|
|
|
13.1
|
%
|
Percent of revenue
|
10.7
|
%
|
|
12.9
|
%
|
|
15.5
|
%
|
|
(2.2)%
|
|
(2.6)%
|
|
Year Ended
|
|
Change
|
||||||||||||||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
FY18 vs. FY17
|
|
FY17 vs. FY16
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands, except percentages)
|
||||||||||||||||||||||||
Selling, general, and administrative
|
$
|
762,219
|
|
|
$
|
667,485
|
|
|
$
|
630,954
|
|
|
$
|
94,734
|
|
|
14.2
|
%
|
|
$
|
36,531
|
|
|
5.8
|
%
|
Percent of revenue
|
6.9
|
%
|
|
8.3
|
%
|
|
10.7
|
%
|
|
(1.4)%
|
|
(2.4)%
|
|
Year Ended
|
|
Change
|
||||||||||||||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
FY18 vs. FY17
|
|
FY17 vs. FY16
|
||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
(in thousands)
|
|
|
|
|
|
|
|
|
||||||||||||||||
Interest income
|
$
|
85,813
|
|
|
$
|
57,858
|
|
|
$
|
29,512
|
|
|
$
|
27,955
|
|
|
48.3
|
%
|
|
$
|
28,346
|
|
|
96.0
|
%
|
Interest expense
|
(97,387
|
)
|
|
(117,734
|
)
|
|
(134,773
|
)
|
|
$
|
20,347
|
|
|
(17.3
|
)%
|
|
$
|
17,039
|
|
|
(12.7
|
)%
|
|||
Gains (losses) on deferred compensation plan related assets, net
|
14,692
|
|
|
17,880
|
|
|
(3,995
|
)
|
|
$
|
(3,188
|
)
|
|
(17.8
|
)%
|
|
$
|
21,875
|
|
|
(547.6
|
)%
|
|||
Loss on impairment of investments
|
(42,456
|
)
|
|
—
|
|
|
—
|
|
|
$
|
(42,456
|
)
|
|
100.0
|
%
|
|
$
|
—
|
|
|
—
|
%
|
|||
Gains (losses) on extinguishment of debt, net
|
542
|
|
|
(36,252
|
)
|
|
—
|
|
|
$
|
36,794
|
|
|
(101.5
|
)%
|
|
$
|
(36,252
|
)
|
|
(100.0
|
)%
|
|||
Foreign exchange (losses) gains, net
|
(3,382
|
)
|
|
(569
|
)
|
|
308
|
|
|
$
|
(2,813
|
)
|
|
494.4
|
%
|
|
$
|
(877
|
)
|
|
(284.7
|
)%
|
|||
Other, net
|
(19,332
|
)
|
|
(11,642
|
)
|
|
(5,191
|
)
|
|
$
|
(7,690
|
)
|
|
66.1
|
%
|
|
$
|
(6,451
|
)
|
|
125.7
|
%
|
|||
|
$
|
(61,510
|
)
|
|
$
|
(90,459
|
)
|
|
$
|
(114,139
|
)
|
|
$
|
28,949
|
|
|
(32.0
|
)%
|
|
$
|
23,680
|
|
|
(20.7
|
)%
|
•
|
the recognition and valuation of revenue from multiple-element arrangements, which impacts revenue;
|
•
|
the valuation of inventory, which impacts gross margin;
|
•
|
the valuation of warranty reserves, which impacts gross margin;
|
•
|
the valuation of equity-based compensation expense, including forfeiture estimates, which impacts both gross margin and operating expenses;
|
•
|
the recognition and measurement of current and deferred income taxes, including the measurement of uncertain tax positions, which impact our provision for income tax expenses; and
|
•
|
the valuation and recoverability of long-lived assets, which impacts gross margin and operating expenses when we record asset impairments or accelerate their depreciation or amortization.
|
Net income
|
$
|
2,381
|
|
Non-cash charges:
|
|
||
Depreciation and amortization
|
326
|
|
|
Equity-based compensation expense
|
172
|
|
|
Deferred income taxes
|
3
|
|
|
Impairment of investments
|
42
|
|
|
Amortization of note discounts and issuance costs
|
14
|
|
|
Changes in operating asset and liability accounts
|
(317
|
)
|
|
Other
|
35
|
|
|
|
$
|
2,656
|
|
|
Total
|
|
Less than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More than
5 Years
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Operating leases
|
$
|
74,343
|
|
|
$
|
22,117
|
|
|
$
|
32,635
|
|
|
$
|
8,556
|
|
|
$
|
11,035
|
|
Capital leases
|
64,116
|
|
|
3,948
|
|
|
9,345
|
|
|
13,116
|
|
|
37,707
|
|
|||||
Purchase obligations
|
372,226
|
|
|
353,295
|
|
|
12,317
|
|
|
6,452
|
|
|
162
|
|
|||||
Long-term debt and interest expense
(1)
|
2,513,556
|
|
|
61,736
|
|
|
1,404,664
|
|
|
51,173
|
|
|
995,983
|
|
|||||
One-time transition tax on accumulated unrepatriated foreign earnings
(2)
|
882,995
|
|
|
70,640
|
|
|
141,279
|
|
|
141,279
|
|
|
529,797
|
|
|||||
Other long-term liabilities
(3)
|
90,629
|
|
|
5,280
|
|
|
12,898
|
|
|
6,104
|
|
|
66,347
|
|
|||||
Total
|
$
|
3,997,865
|
|
|
$
|
517,016
|
|
|
$
|
1,613,138
|
|
|
$
|
226,680
|
|
|
$
|
1,641,031
|
|
(1)
|
The conversion period for the 2.625% Convertible Senior Notes due May 2041 (the “2041 Notes”) was open as of June 24, 2018, and as such the net carrying value of the 2041 Notes is included within current liabilities on our Consolidated Balance Sheet. The principal balances of the 2041 Notes are reflected in the payment period in the table above based on the contractual maturity assuming no conversion. See Note 13 of our Consolidated Financial Statements in Part II, Item 8 of this 2018 Form 10-K for additional information concerning the 2041 Notes and associated conversion features.
|
(2)
|
Value represented is provisional in nature and subject to future measurement period adjustments under SAB 118. We may choose to apply existing tax credits, thereby reducing the actual cash payment.
|
(3)
|
Certain tax-related liabilities and post-retirement benefits classified as other non-current liabilities on the Consolidated Balance Sheet are included in the “More than 5 Years” category due to the uncertainty in the timing and amount of future payments. Additionally, the balance excludes contractual obligations recorded in our Consolidated Balance Sheet as current liabilities.
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk
|
|
Valuation of Securities
Given an Interest Rate
Decrease of X Basis Points
|
|
Fair Value
as of
|
|
Valuation of Securities
Given an Interest Rate
Increase of X Basis Points
|
||||||||||||||||||||||
|
June 24, 2018
|
|
|||||||||||||||||||||||||
(150 BPS)
|
|
(100 BPS)
|
|
(50 BPS)
|
|
—%
|
|
50 BPS
|
|
100 BPS
|
|
150 BPS
|
|||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||
Municipal notes and bonds
|
153,974
|
|
|
153,365
|
|
|
152,750
|
|
|
152,136
|
|
|
151,521
|
|
|
150,906
|
|
|
150,292
|
|
|||||||
U.S. Treasury and agencies
|
357,056
|
|
|
356,874
|
|
|
356,692
|
|
|
356,509
|
|
|
356,327
|
|
|
356,145
|
|
|
355,963
|
|
|||||||
Government-sponsored enterprises
|
111,104
|
|
|
110,990
|
|
|
110,876
|
|
|
110,762
|
|
|
110,648
|
|
|
110,534
|
|
|
110,420
|
|
|||||||
Foreign government bonds
|
19,999
|
|
|
19,995
|
|
|
19,990
|
|
|
19,985
|
|
|
19,981
|
|
|
19,976
|
|
|
19,971
|
|
|||||||
Bank and corporate notes
|
518,765
|
|
|
517,798
|
|
|
516,832
|
|
|
515,866
|
|
|
514,899
|
|
|
513,933
|
|
|
512,967
|
|
|||||||
Mortgage backed securities - residential
|
849
|
|
|
833
|
|
|
817
|
|
|
801
|
|
|
785
|
|
|
770
|
|
|
754
|
|
|||||||
Total
|
$
|
1,161,747
|
|
|
$
|
1,159,855
|
|
|
$
|
1,157,957
|
|
|
$
|
1,156,059
|
|
|
$
|
1,154,161
|
|
|
$
|
1,152,264
|
|
|
$
|
1,150,367
|
|
|
Notional
Amount
|
|
Unrealized FX
Gain/(Loss)
|
|
Valuation of FX Contracts Given an X%
Increase (+)/Decrease(-) in Each
|
||||||||||||
|
June 24, 2018
|
= +/- (10%)
|
|
= +/- (15%)
|
|||||||||||||
|
(in millions)
|
||||||||||||||||
Forward contracts, balance sheet hedge
|
|
|
|
|
|
|
|||||||||||
Sell
|
Japanese yen
|
$
|
267.4
|
|
|
$
|
0.1
|
|
|
$
|
26.7
|
|
|
$
|
40.0
|
|
|
Sell
|
Korean won
|
99.4
|
|
|
—
|
|
|
9.9
|
|
|
14.9
|
|
|||||
Buy
|
Euro
|
45.3
|
|
|
—
|
|
|
14.9
|
|
|
16.6
|
|
|||||
Buy
|
Taiwan dollar
|
31.9
|
|
|
—
|
|
|
3.2
|
|
|
4.8
|
|
|||||
Buy
|
Singapore dollar
|
21.4
|
|
|
—
|
|
|
2.2
|
|
|
3.2
|
|
|||||
Buy
|
British pound
|
15.9
|
|
|
—
|
|
|
0.9
|
|
|
1.3
|
|
|||||
Buy
|
Swiss francs
|
14.9
|
|
|
—
|
|
|
1.5
|
|
|
2.2
|
|
|||||
Buy
|
Chinese renminbi
|
2.5
|
|
|
—
|
|
|
0.2
|
|
|
0.4
|
|
|||||
Buy
|
Indian rupee
|
3.2
|
|
|
—
|
|
|
0.3
|
|
|
0.5
|
|
|||||
|
|
|
|
$
|
0.1
|
|
|
$
|
59.8
|
|
|
$
|
83.9
|
|
Item 8.
|
Financial Statements and Supplementary Data
|
|
Page
|
Consolidated Statements of Operations — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Consolidated Statements of Comprehensive Income — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Consolidated Balance Sheets — June 24, 2018, and June 25, 2017
|
|
Consolidated Statements of Cash Flows — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Consolidated Statements of Stockholders’ Equity — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Notes to Consolidated Financial Statements
|
|
Reports of Independent Registered Public Accounting Firm
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
Revenue
|
$
|
11,076,998
|
|
|
$
|
8,013,620
|
|
|
$
|
5,885,893
|
|
Cost of goods sold
|
5,911,966
|
|
|
4,410,261
|
|
|
3,266,971
|
|
|||
Gross margin
|
5,165,032
|
|
|
3,603,359
|
|
|
2,618,922
|
|
|||
Research and development
|
1,189,514
|
|
|
1,033,742
|
|
|
913,712
|
|
|||
Selling, general, and administrative
|
762,219
|
|
|
667,485
|
|
|
630,954
|
|
|||
Total operating expenses
|
1,951,733
|
|
|
1,701,227
|
|
|
1,544,666
|
|
|||
Operating income
|
3,213,299
|
|
|
1,902,132
|
|
|
1,074,256
|
|
|||
Other expense, net
|
(61,510
|
)
|
|
(90,459
|
)
|
|
(114,139
|
)
|
|||
Income before income taxes
|
3,151,789
|
|
|
1,811,673
|
|
|
960,117
|
|
|||
Income tax expense
|
(771,108
|
)
|
|
(113,910
|
)
|
|
(46,068
|
)
|
|||
Net income
|
$
|
2,380,681
|
|
|
$
|
1,697,763
|
|
|
$
|
914,049
|
|
Net income per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
14.73
|
|
|
$
|
10.47
|
|
|
$
|
5.75
|
|
Diluted
|
$
|
13.17
|
|
|
$
|
9.24
|
|
|
$
|
5.22
|
|
Number of shares used in per share calculations:
|
|
|
|
|
|
||||||
Basic
|
161,643
|
|
|
162,222
|
|
|
158,919
|
|
|||
Diluted
|
180,782
|
|
|
183,770
|
|
|
175,159
|
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
Net income
|
$
|
2,380,681
|
|
|
$
|
1,697,763
|
|
|
$
|
914,049
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Foreign currency translation adjustment
|
9,649
|
|
|
(2,843
|
)
|
|
(4,403
|
)
|
|||
Cash flow hedges:
|
|
|
|
|
|
||||||
Net unrealized (losses) gains during the period
|
(6,960
|
)
|
|
5,841
|
|
|
(17,725
|
)
|
|||
Net losses reclassified into earnings
|
3,729
|
|
|
8,971
|
|
|
4,961
|
|
|||
|
(3,231
|
)
|
|
14,812
|
|
|
(12,764
|
)
|
|||
Available-for-sale investments:
|
|
|
|
|
|
||||||
Net unrealized (losses) gains during the period
|
(45,382
|
)
|
|
(3,789
|
)
|
|
9,028
|
|
|||
Net losses (gains) reclassified into earnings
|
43,086
|
|
|
(1
|
)
|
|
(371
|
)
|
|||
|
(2,296
|
)
|
|
(3,790
|
)
|
|
8,657
|
|
|||
Defined benefit plans, net change in unrealized component
|
129
|
|
|
(546
|
)
|
|
(3,027
|
)
|
|||
Other comprehensive income (loss), net of tax
|
4,251
|
|
|
7,633
|
|
|
(11,537
|
)
|
|||
Comprehensive income
|
$
|
2,384,932
|
|
|
$
|
1,705,396
|
|
|
$
|
902,512
|
|
|
June 24,
2018 |
|
June 25,
2017 |
||||
ASSETS:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
4,512,257
|
|
|
$
|
2,377,534
|
|
Investments
|
437,338
|
|
|
3,663,628
|
|
||
Accounts receivable, less allowance for doubtful accounts of $5,343 as of June 24, 2018 and $5,103 as of June 25, 2017
|
2,176,936
|
|
|
1,673,398
|
|
||
Inventories
|
1,876,162
|
|
|
1,232,916
|
|
||
Prepaid expenses and other current assets
|
147,218
|
|
|
195,022
|
|
||
Total current assets
|
9,149,911
|
|
|
9,142,498
|
|
||
Property and equipment, net
|
902,547
|
|
|
685,595
|
|
||
Restricted cash and investments
|
256,301
|
|
|
256,205
|
|
||
Goodwill
|
1,484,904
|
|
|
1,385,673
|
|
||
Intangible assets, net
|
317,836
|
|
|
410,995
|
|
||
Other assets
|
367,979
|
|
|
241,799
|
|
||
Total assets
|
$
|
12,479,478
|
|
|
$
|
12,122,765
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY:
|
|
|
|
||||
Trade accounts payable
|
$
|
510,983
|
|
|
$
|
464,643
|
|
Accrued expenses and other current liabilities
|
1,309,209
|
|
|
969,361
|
|
||
Deferred profit
|
720,086
|
|
|
607,672
|
|
||
Commercial paper and current portion of convertible notes and capital leases
|
610,030
|
|
|
908,439
|
|
||
Total current liabilities
|
3,150,308
|
|
|
2,950,115
|
|
||
Senior notes, convertible notes, and capital leases, less current portion
|
1,806,562
|
|
|
1,784,974
|
|
||
Income taxes payable
|
851,936
|
|
|
120,178
|
|
||
Other long-term liabilities
|
90,629
|
|
|
280,186
|
|
||
Total liabilities
|
5,899,435
|
|
|
5,135,453
|
|
||
Commitments and contingencies
|
|
|
|
||||
Temporary equity, convertible notes
|
78,192
|
|
|
169,861
|
|
||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock, at par value of $0.001 per share; authorized - 5,000 shares, none outstanding
|
—
|
|
|
—
|
|
||
Common stock, at par value of $0.001 per share; authorized - 400,000 shares; issued and outstanding 156,892 shares at June 24, 2018, and 161,723 shares at June 25, 2017
|
157
|
|
|
162
|
|
||
Additional paid-in capital
|
6,144,425
|
|
|
5,845,485
|
|
||
Treasury stock, at cost, 119,679 shares at June 24, 2018, and 105,569 shares at June 25, 2017
|
(7,846,476
|
)
|
|
(5,216,187
|
)
|
||
Accumulated other comprehensive loss
|
(57,449
|
)
|
|
(61,700
|
)
|
||
Retained earnings
|
8,261,194
|
|
|
6,249,691
|
|
||
Total stockholders’ equity
|
6,501,851
|
|
|
6,817,451
|
|
||
Total liabilities and stockholders’ equity
|
$
|
12,479,478
|
|
|
$
|
12,122,765
|
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
||||||
Net income
|
$
|
2,380,681
|
|
|
$
|
1,697,763
|
|
|
$
|
914,049
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
326,395
|
|
|
306,905
|
|
|
291,028
|
|
|||
Deferred income taxes
|
3,046
|
|
|
104,936
|
|
|
(49,003
|
)
|
|||
Equity-based compensation expense
|
172,216
|
|
|
149,975
|
|
|
142,348
|
|
|||
Income tax benefit (expense) on equity-based compensation plans
|
—
|
|
|
38,747
|
|
|
(1,023
|
)
|
|||
Excess tax (benefits) expense on equity-based compensation plans
|
—
|
|
|
(38,635
|
)
|
|
1,020
|
|
|||
Impairment of investments
|
42,456
|
|
|
—
|
|
|
—
|
|
|||
(Gains) losses on extinguishment of debt, net
|
(542
|
)
|
|
36,252
|
|
|
—
|
|
|||
Amortization of note discounts and issuance costs
|
14,428
|
|
|
25,282
|
|
|
70,522
|
|
|||
Gain on sale of assets
|
—
|
|
|
(163
|
)
|
|
(15,223
|
)
|
|||
Other, net
|
34,260
|
|
|
19,052
|
|
|
48,788
|
|
|||
Changes in operating asset and liability accounts:
|
|
|
|
|
|
||||||
Accounts receivable, net of allowance
|
(501,628
|
)
|
|
(411,287
|
)
|
|
(169,034
|
)
|
|||
Inventories
|
(701,008
|
)
|
|
(307,875
|
)
|
|
(66,371
|
)
|
|||
Prepaid expenses and other assets
|
(14,391
|
)
|
|
(27,269
|
)
|
|
(46,664
|
)
|
|||
Trade accounts payable
|
35,655
|
|
|
126,819
|
|
|
41,645
|
|
|||
Deferred profit
|
112,413
|
|
|
258,473
|
|
|
27,129
|
|
|||
Accrued expenses and other liabilities
|
751,766
|
|
|
50,307
|
|
|
161,066
|
|
|||
Net cash provided by operating activities
|
2,655,747
|
|
|
2,029,282
|
|
|
1,350,277
|
|
|||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
|
|
||||||
Capital expenditures and intangible assets
|
(273,469
|
)
|
|
(157,419
|
)
|
|
(175,330
|
)
|
|||
Business acquisition, net of cash acquired
|
(115,697
|
)
|
|
—
|
|
|
—
|
|
|||
Purchases of available-for-sale securities
|
(2,532,829
|
)
|
|
(4,581,851
|
)
|
|
(874,998
|
)
|
|||
Proceeds from maturities of available-for-sale securities
|
650,255
|
|
|
891,002
|
|
|
642,505
|
|
|||
Proceeds from sales of available-for-sale securities
|
5,035,460
|
|
|
1,806,963
|
|
|
1,031,321
|
|
|||
Proceeds from sale of assets
|
—
|
|
|
1,291
|
|
|
79,730
|
|
|||
Transfer of restricted cash and investments
|
(96
|
)
|
|
(5,784
|
)
|
|
(112,381
|
)
|
|||
Other, net
|
(15,184
|
)
|
|
(12,815
|
)
|
|
1,636
|
|
|||
Net cash provided by (used for) investing activities
|
2,748,440
|
|
|
(2,058,613
|
)
|
|
592,483
|
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
|
|
||||||
Principal payments on long-term debt and capital lease obligations and payments for debt issuance costs
|
(755,694
|
)
|
|
(1,688,313
|
)
|
|
(451,497
|
)
|
|||
Net proceeds from issuance of long-term debt
|
—
|
|
|
—
|
|
|
2,338,144
|
|
|||
Net proceeds from issuance of commercial paper
|
359,604
|
|
|
—
|
|
|
—
|
|
|||
Proceeds from borrowings on revolving credit facility
|
750,000
|
|
|
—
|
|
|
—
|
|
|||
Repayment of borrowings on revolving credit facility
|
(750,000
|
)
|
|
—
|
|
|
—
|
|
|||
Excess tax benefits (expense) on equity-based compensation plans
|
—
|
|
|
38,635
|
|
|
(1,020
|
)
|
|||
Treasury stock purchases
|
(2,653,249
|
)
|
|
(811,672
|
)
|
|
(158,389
|
)
|
|||
Dividends paid
|
(307,609
|
)
|
|
(243,495
|
)
|
|
(190,402
|
)
|
|||
Reissuances of treasury stock related to employee stock purchase plan
|
75,624
|
|
|
59,663
|
|
|
55,992
|
|
|||
Proceeds from issuance of common stock
|
9,258
|
|
|
12,913
|
|
|
3,405
|
|
|||
Other, net
|
9
|
|
|
(125
|
)
|
|
(488
|
)
|
|||
Net cash (used for) provided by financing activities
|
$
|
(3,272,057
|
)
|
|
$
|
(2,632,394
|
)
|
|
$
|
1,595,745
|
|
Effect of exchange rate changes on cash and cash equivalents
|
$
|
2,593
|
|
|
$
|
(63
|
)
|
|
$
|
(722
|
)
|
Net increase (decrease) in cash and cash equivalents
|
2,134,723
|
|
|
(2,661,788
|
)
|
|
3,537,783
|
|
|||
Cash and cash equivalents at beginning of year
|
2,377,534
|
|
|
5,039,322
|
|
|
1,501,539
|
|
|||
Cash and cash equivalents at end of year
|
$
|
4,512,257
|
|
|
$
|
2,377,534
|
|
|
$
|
5,039,322
|
|
Schedule of non-cash transactions
|
|
|
|
|
|
||||||
Accrued payables for stock repurchases
|
$
|
116
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Accrued payables for capital expenditures
|
24,001
|
|
|
17,285
|
|
|
27,953
|
|
|||
Dividends payable
|
174,372
|
|
|
72,738
|
|
|
48,052
|
|
|||
Transfers of finished goods inventory to property and equipment, net
|
57,886
|
|
|
46,855
|
|
|
37,822
|
|
|||
Supplemental disclosures:
|
|
|
|
|
|
||||||
Cash payments for interest
|
$
|
84,401
|
|
|
$
|
104,619
|
|
|
$
|
58,810
|
|
Cash payments for income taxes, net
|
142,800
|
|
|
28,104
|
|
|
39,745
|
|
|
Common
Stock Shares |
|
Common
Stock |
|
Additional
Paid-in Capital |
|
Treasury
Stock |
|
Accumulated
Other Comprehensive Income(Loss) |
|
Retained
Earnings |
|
Total
|
|||||||||||||
Balance at June 28, 2015
|
158,531
|
|
|
$
|
159
|
|
|
$
|
5,366,773
|
|
|
$
|
(4,302,847
|
)
|
|
$
|
(57,796
|
)
|
|
$
|
4,096,855
|
|
|
$
|
5,103,144
|
|
Sale of common stock
|
2,863
|
|
|
2
|
|
|
3,403
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,405
|
|
||||||
Purchase of treasury stock
|
(2,130
|
)
|
|
(2
|
)
|
|
—
|
|
|
(155,132
|
)
|
|
—
|
|
|
—
|
|
|
(155,134
|
)
|
||||||
Income tax benefits on equity-based compensation plans
|
—
|
|
|
—
|
|
|
(1,023
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,023
|
)
|
||||||
Reissuance of treasury stock
|
937
|
|
|
1
|
|
|
27,329
|
|
|
28,662
|
|
|
—
|
|
|
—
|
|
|
55,992
|
|
||||||
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
142,348
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
142,348
|
|
||||||
Effect of conversion of convertible notes
|
—
|
|
|
—
|
|
|
(188
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(188
|
)
|
||||||
Reclassification from temporary to permanent equity
|
—
|
|
|
—
|
|
|
34,256
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34,256
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
914,049
|
|
|
914,049
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,537
|
)
|
|
—
|
|
|
(11,537
|
)
|
||||||
Cash dividends declared ($1.20 per common share)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(190,795
|
)
|
|
(190,795
|
)
|
||||||
Balance at June 26, 2016
|
160,201
|
|
|
160
|
|
|
5,572,898
|
|
|
(4,429,317
|
)
|
|
(69,333
|
)
|
|
4,820,109
|
|
|
5,894,517
|
|
||||||
Sale of common stock
|
2,661
|
|
|
3
|
|
|
12,910
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
12,913
|
|
||||||
Purchase of treasury stock
|
(5,322
|
)
|
|
(5
|
)
|
|
—
|
|
|
(811,667
|
)
|
|
—
|
|
|
—
|
|
|
(811,672
|
)
|
||||||
Income tax benefits on equity-based compensation plans
|
—
|
|
|
—
|
|
|
38,747
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,747
|
|
||||||
Reissuance of treasury stock
|
825
|
|
|
1
|
|
|
34,865
|
|
|
24,797
|
|
|
—
|
|
|
—
|
|
|
59,663
|
|
||||||
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
149,975
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
149,975
|
|
||||||
Effect of conversion of convertible notes
|
1,388
|
|
|
1
|
|
|
(1,596
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,595
|
)
|
||||||
Exercise of warrants
|
1,970
|
|
|
2
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||||
Reclassification from temporary to permanent equity
|
—
|
|
|
—
|
|
|
37,691
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
37,691
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,697,763
|
|
|
1,697,763
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,633
|
|
|
—
|
|
|
7,633
|
|
||||||
Cash dividends declared ($1.65 per common share)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(268,181
|
)
|
|
(268,181
|
)
|
||||||
Balance at June 25, 2017
|
161,723
|
|
|
162
|
|
|
5,845,485
|
|
|
(5,216,187
|
)
|
|
(61,700
|
)
|
|
6,249,691
|
|
|
6,817,451
|
|
||||||
Sale of common stock
|
1,934
|
|
|
2
|
|
|
9,256
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,258
|
|
||||||
Purchase of treasury stock
|
(14,786
|
)
|
|
(15
|
)
|
|
—
|
|
|
(2,653,350
|
)
|
|
—
|
|
|
—
|
|
|
(2,653,365
|
)
|
||||||
Reissuance of treasury stock
|
677
|
|
|
1
|
|
|
52,562
|
|
|
23,061
|
|
|
—
|
|
|
—
|
|
|
75,624
|
|
||||||
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
172,216
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
172,216
|
|
||||||
Effect of conversion of convertible notes
|
10,199
|
|
|
10
|
|
|
(26,776
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(26,766
|
)
|
||||||
Effect of bond hedge, cash in lieu of shares
|
(2,855
|
)
|
|
(3
|
)
|
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||
Reclassification from temporary to permanent equity
|
—
|
|
|
—
|
|
|
91,669
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
91,669
|
|
||||||
Adoption of ASU 2016-09
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
40,065
|
|
|
40,065
|
|
||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,380,681
|
|
|
2,380,681
|
|
||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,251
|
|
|
—
|
|
|
4,251
|
|
||||||
Cash dividends declared ($2.55 per common share)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(409,243
|
)
|
|
(409,243
|
)
|
||||||
Balance at June 24, 2018
|
156,892
|
|
|
$
|
157
|
|
|
$
|
6,144,425
|
|
|
$
|
(7,846,476
|
)
|
|
$
|
(57,449
|
)
|
|
$
|
8,261,194
|
|
|
$
|
6,501,851
|
|
•
|
entities will be required to recognize all excess tax benefits or deficiencies as an income tax benefit or expense in the income statement, eliminating additional paid in capital (“APIC”) pools;
|
•
|
entities will no longer be required to delay recognition of excess tax benefits until they are realized;
|
•
|
entities will be required to classify the excess tax benefits as an operating activity in the statement of cash flows;
|
•
|
entities will be allowed to elect an accounting policy to either estimate the number of forfeitures or account for forfeitures as they occur;
|
•
|
entities can withhold up to the maximum individual statutory tax rate without classifying the awards as a liability; and
|
•
|
the cash paid to satisfy the statutory income tax withholding obligations shall be classified as a financing activity in the statement of cash flows.
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
|
(in thousands)
|
||||||||||
Equity-based compensation expense
|
$
|
172,216
|
|
|
$
|
149,975
|
|
|
$
|
142,348
|
|
Income tax benefit recognized related to equity-based compensation
|
$
|
87,505
|
|
|
$
|
38,381
|
|
|
$
|
37,814
|
|
Income tax benefit realized from the exercise and vesting of options and RSUs
|
$
|
90,297
|
|
|
$
|
92,749
|
|
|
$
|
67,756
|
|
|
Options Outstanding
|
|||||
Number of
Shares |
|
Weighted-Average
Exercise Price |
||||
June 28, 2015
|
835,832
|
|
|
$
|
37.44
|
|
Granted
|
196,167
|
|
|
$
|
75.57
|
|
Exercised
|
(123,726
|
)
|
|
$
|
24.92
|
|
Forfeited or expired
|
(862
|
)
|
|
$
|
21.43
|
|
June 26, 2016
|
907,411
|
|
|
$
|
47.41
|
|
Granted
|
90,128
|
|
|
$
|
119.67
|
|
Exercised
|
(389,460
|
)
|
|
$
|
33.92
|
|
Forfeited or expired
|
(14,020
|
)
|
|
$
|
69.81
|
|
June 25, 2017
|
594,059
|
|
|
$
|
66.69
|
|
Granted
|
63,980
|
|
|
$
|
190.07
|
|
Exercised
|
(166,481
|
)
|
|
$
|
55.62
|
|
Forfeited or expired
|
(8,630
|
)
|
|
$
|
84.44
|
|
June 24, 2018
|
482,928
|
|
|
$
|
86.53
|
|
Range of Exercise Prices
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||
Number of
Options Outstanding |
|
Weighted-Average
Remaining Life (Years) |
|
Weighted-Average
Exercise Price |
|
Number of
Options Exercisable |
|
Weighted-Average
Remaining Life (Years) |
|
Weighted-Average
Exercise Price |
|||||||
$11.09-$23.59
|
33,918
|
|
|
1.49
|
|
$
|
18.97
|
|
|
33,918
|
|
|
1.49
|
|
$
|
18.97
|
|
$28.73-$35.68
|
39,060
|
|
|
2.63
|
|
$
|
31.29
|
|
|
39,060
|
|
|
2.63
|
|
$
|
31.29
|
|
$42.61-$51.76
|
75,415
|
|
|
2.03
|
|
$
|
47.30
|
|
|
75,415
|
|
|
2.03
|
|
$
|
47.30
|
|
$75.57-$190.07
|
334,535
|
|
|
5.08
|
|
$
|
108.67
|
|
|
155,504
|
|
|
4.33
|
|
$
|
83.58
|
|
$11.09-$190.07
|
482,928
|
|
|
4.15
|
|
$
|
86.53
|
|
|
303,897
|
|
|
3.23
|
|
$
|
60.65
|
|
|
Year Ended
|
|||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||
Expected volatility
|
34.66
|
%
|
|
28.85
|
%
|
|
33.08
|
%
|
Risk-free interest rate
|
2.53
|
%
|
|
1.92
|
%
|
|
1.27
|
%
|
Expected term (years)
|
4.74
|
|
|
4.75
|
|
|
4.79
|
|
Dividend yield
|
1.05
|
%
|
|
1.50
|
%
|
|
1.59
|
%
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
|
(in thousands)
|
||||||||||
Intrinsic value - options outstanding
|
$
|
43,563
|
|
|
$
|
50,551
|
|
|
$
|
31,643
|
|
Intrinsic value - options exercisable
|
$
|
34,661
|
|
|
$
|
36,396
|
|
|
$
|
29,112
|
|
Intrinsic value - options exercised
|
$
|
23,925
|
|
|
$
|
29,674
|
|
|
$
|
6,562
|
|
|
Service-based RSUs Outstanding
|
|
Market-based RSUs Outstanding
|
||||||||||
Number of
Shares |
|
Weighted-Average
Grant Date Fair Value |
|
Number of
Shares |
|
Weighted-Average
Grant Date Fair Value |
|||||||
June 28, 2015
|
4,040,947
|
|
|
$
|
60.98
|
|
|
913,141
|
|
|
$
|
56.37
|
|
Granted
|
1,771,599
|
|
|
72.14
|
|
|
459,252
|
|
|
70.58
|
|
||
Vested
|
(2,445,902
|
)
|
|
54.91
|
|
|
(293,802
|
)
|
|
46.77
|
|
||
Forfeited or canceled
|
(110,131
|
)
|
|
69.17
|
|
|
—
|
|
|
—
|
|
||
June 26, 2016
|
3,256,513
|
|
|
$
|
71.34
|
|
|
1,078,591
|
|
|
$
|
63.12
|
|
Granted
|
1,224,877
|
|
|
114.13
|
|
|
435,694
|
|
|
111.75
|
|
||
Vested
|
(1,677,318
|
)
|
|
69.10
|
|
|
(592,321
|
)
|
|
46.67
|
|
||
Forfeited or canceled
|
(116,466
|
)
|
|
76.76
|
|
|
(59,509
|
)
|
|
66.81
|
|
||
June 25, 2017
|
2,687,606
|
|
|
$
|
92.01
|
|
|
862,455
|
|
|
$
|
83.83
|
|
Granted
|
964,391
|
|
|
183.97
|
|
|
285,866
|
|
|
170.15
|
|
||
Vested
|
(1,362,369
|
)
|
|
87.80
|
|
|
(407,024
|
)
|
|
76.88
|
|
||
Forfeited or canceled
|
(96,540
|
)
|
|
108.67
|
|
|
(47,571
|
)
|
|
91.36
|
|
||
June 24, 2018
|
2,193,088
|
|
|
$
|
134.34
|
|
|
693,726
|
|
|
$
|
104.59
|
|
|
Year Ended
|
|||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||
Expected volatility
|
34.07
|
%
|
|
27.48
|
%
|
|
29.81
|
%
|
Risk-free interest rate
|
2.35
|
%
|
|
1.55
|
%
|
|
0.97
|
%
|
Expected term (years)
|
2.92
|
|
|
2.92
|
|
|
2.92
|
|
Dividend yield
|
1.05
|
%
|
|
1.50
|
%
|
|
1.59
|
%
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
|
(in thousands)
|
||||||||||
Interest income
|
$
|
85,813
|
|
|
$
|
57,858
|
|
|
$
|
29,512
|
|
Interest expense
|
(97,387
|
)
|
|
(117,734
|
)
|
|
(134,773
|
)
|
|||
Gains (losses) on deferred compensation plan related assets, net
|
14,692
|
|
|
17,880
|
|
|
(3,995
|
)
|
|||
Loss on impairment of investments
|
(42,456
|
)
|
|
—
|
|
|
—
|
|
|||
Gains (losses) on extinguishment of debt, net
|
542
|
|
|
(36,252
|
)
|
|
—
|
|
|||
Foreign exchange (losses) gains, net
|
(3,382
|
)
|
|
(569
|
)
|
|
308
|
|
|||
Other, net
|
(19,332
|
)
|
|
(11,642
|
)
|
|
(5,191
|
)
|
|||
|
$
|
(61,510
|
)
|
|
$
|
(90,459
|
)
|
|
$
|
(114,139
|
)
|
|
Year Ended
|
||||||||||
|
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||||
|
(in thousands)
|
||||||||||
United States
|
$
|
128,190
|
|
|
$
|
7,553
|
|
|
$
|
(113,607
|
)
|
Foreign
|
3,023,599
|
|
|
1,804,120
|
|
|
1,073,724
|
|
|||
|
$
|
3,151,789
|
|
|
$
|
1,811,673
|
|
|
$
|
960,117
|
|
|
Year Ended
|
||||||||||
|
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||||
|
(in thousands)
|
||||||||||
Federal:
|
|
|
|
|
|
||||||
Current
|
$
|
630,148
|
|
|
$
|
(70,858
|
)
|
|
$
|
1,426
|
|
Deferred
|
12,871
|
|
|
99,700
|
|
|
(38,616
|
)
|
|||
|
643,019
|
|
|
28,842
|
|
|
(37,190
|
)
|
|||
State:
|
|
|
|
|
|
||||||
Current
|
5,348
|
|
|
(963
|
)
|
|
2,892
|
|
|||
Deferred
|
(3,273
|
)
|
|
(2,246
|
)
|
|
(7,600
|
)
|
|||
|
2,075
|
|
|
(3,209
|
)
|
|
(4,708
|
)
|
|||
Foreign:
|
|
|
|
|
|
||||||
Current
|
132,566
|
|
|
85,479
|
|
|
90,752
|
|
|||
Deferred
|
(6,552
|
)
|
|
2,798
|
|
|
(2,786
|
)
|
|||
|
126,014
|
|
|
88,277
|
|
|
87,966
|
|
|||
Total provision for income taxes
|
$
|
771,108
|
|
|
$
|
113,910
|
|
|
$
|
46,068
|
|
|
June 24,
2018 |
|
June 25,
2017 |
||||
|
(in thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Tax carryforwards
|
$
|
206,073
|
|
|
$
|
175,595
|
|
Allowances and reserves
|
118,559
|
|
|
170,752
|
|
||
Equity-based compensation
|
16,189
|
|
|
25,828
|
|
||
Inventory valuation differences
|
14,021
|
|
|
19,602
|
|
||
Prepaid cost sharing
|
65,644
|
|
|
133,831
|
|
||
Other
|
16,514
|
|
|
20,175
|
|
||
Gross deferred tax assets
|
437,000
|
|
|
545,783
|
|
||
Valuation allowance
|
(199,839
|
)
|
|
(114,011
|
)
|
||
Net deferred tax assets
|
237,161
|
|
|
431,772
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Intangible assets
|
(21,558
|
)
|
|
(30,944
|
)
|
||
Convertible debt
|
(60,252
|
)
|
|
(153,047
|
)
|
||
Capital assets
|
(61,429
|
)
|
|
(72,727
|
)
|
||
Amortization of goodwill
|
(10,738
|
)
|
|
(15,582
|
)
|
||
Unremitted earnings of foreign subsidiaries
|
(6,656
|
)
|
|
(302,663
|
)
|
||
Other
|
(7,955
|
)
|
|
(9,844
|
)
|
||
Gross deferred tax liabilities
|
(168,588
|
)
|
|
(584,807
|
)
|
||
Net deferred tax assets (liabilities)
|
$
|
68,573
|
|
|
$
|
(153,035
|
)
|
|
Year Ended
|
||||||||||
|
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||||
|
(in thousands)
|
||||||||||
Income tax expense computed at federal statutory rate
|
$
|
891,011
|
|
|
$
|
634,086
|
|
|
$
|
336,041
|
|
State income taxes, net of federal tax benefit
|
(50,585
|
)
|
|
(11,973
|
)
|
|
(14,070
|
)
|
|||
Foreign income taxed at different rates
|
(939,808
|
)
|
|
(352,860
|
)
|
|
(265,123
|
)
|
|||
Settlements and reductions in uncertain tax positions
|
(33,367
|
)
|
|
(144,519
|
)
|
|
—
|
|
|||
Tax credits
|
(69,301
|
)
|
|
(37,713
|
)
|
|
(48,277
|
)
|
|||
State valuation allowance, net of federal tax benefit
|
57,302
|
|
|
12,070
|
|
|
17,948
|
|
|||
Equity-based compensation
|
(35,875
|
)
|
|
13,187
|
|
|
12,366
|
|
|||
Other permanent differences and miscellaneous items
|
43,214
|
|
|
1,632
|
|
|
7,183
|
|
|||
U.S. tax reform impacts
|
908,517
|
|
|
—
|
|
|
—
|
|
|||
|
$
|
771,108
|
|
|
$
|
113,910
|
|
|
$
|
46,068
|
|
|
|
||
|
(in thousands)
|
||
Balance as of June 28, 2015
|
$
|
363,552
|
|
Lapse of statute of limitations
|
(10,992
|
)
|
|
Increases in balances related to tax positions taken during prior periods
|
18,200
|
|
|
Decreases in balances related to tax positions taken during prior periods
|
(421
|
)
|
|
Increases in balances related to tax positions taken during current period
|
47,093
|
|
|
Balance as of June 26, 2016
|
417,432
|
|
|
Settlements and effective settlements with tax authorities
|
(6,691
|
)
|
|
Lapse of statute of limitations
|
(113,491
|
)
|
|
Increases in balances related to tax positions taken during prior periods
|
6,557
|
|
|
Decreases in balances related to tax positions taken during prior periods
|
(11,528
|
)
|
|
Increases in balances related to tax positions taken during current period
|
47,168
|
|
|
Balance as of June 25, 2017
|
339,447
|
|
|
Settlements and effective settlements with tax authorities
|
(693
|
)
|
|
Lapse of statute of limitations
|
(88,837
|
)
|
|
Increases in balances related to tax positions taken during prior periods
|
2,044
|
|
|
Decreases in balances related to tax positions taken during prior periods
|
(1,320
|
)
|
|
Increases in balances related to tax positions taken during current period
|
54,772
|
|
|
Balance as of June 24, 2018
|
$
|
305,413
|
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
|
(in thousands, except per share data)
|
||||||||||
Numerator:
|
|
|
|
|
|
||||||
Net income
|
$
|
2,380,681
|
|
|
$
|
1,697,763
|
|
|
$
|
914,049
|
|
Denominator:
|
|
|
|
|
|
||||||
Basic average shares outstanding
|
161,643
|
|
|
162,222
|
|
|
158,919
|
|
|||
Effect of potential dilutive securities:
|
|
|
|
|
|
||||||
Employee stock plans
|
2,312
|
|
|
2,058
|
|
|
2,120
|
|
|||
Convertible notes
|
12,258
|
|
|
16,861
|
|
|
13,464
|
|
|||
Warrants
|
4,569
|
|
|
2,629
|
|
|
656
|
|
|||
Diluted average shares outstanding
|
180,782
|
|
|
183,770
|
|
|
175,159
|
|
|||
Net income per share - basic
|
$
|
14.73
|
|
|
$
|
10.47
|
|
|
$
|
5.75
|
|
Net income per share - diluted
|
$
|
13.17
|
|
|
$
|
9.24
|
|
|
$
|
5.22
|
|
|
Year Ended
|
|||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||
|
(in thousands)
|
|||||||
Options and RSUs
|
34
|
|
|
34
|
|
|
149
|
|
|
June 24, 2018
|
||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
(Reported Within)
|
|||||||||||||||||||||||
Cost
|
|
Unrealized
Gain |
|
Unrealized
(Loss) |
|
Fair Value
|
|
Cash and
Cash Equivalents |
|
Investments
|
|
Restricted
Cash & Investments |
|
Other
Assets |
|||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||||||
Cash
|
$
|
708,364
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
708,364
|
|
|
$
|
702,090
|
|
|
$
|
—
|
|
|
$
|
6,274
|
|
|
$
|
—
|
|
Time deposit
|
999,666
|
|
|
—
|
|
|
—
|
|
|
999,666
|
|
|
749,639
|
|
|
—
|
|
|
250,027
|
|
|
—
|
|
||||||||
Level 1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market funds
|
2,341,807
|
|
|
—
|
|
|
—
|
|
|
2,341,807
|
|
|
2,341,807
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
U.S. Treasury and agencies
|
356,679
|
|
|
—
|
|
|
(170
|
)
|
|
356,509
|
|
|
333,721
|
|
|
22,788
|
|
|
—
|
|
|
—
|
|
||||||||
Mutual funds
|
68,568
|
|
|
516
|
|
|
(142
|
)
|
|
68,942
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
68,942
|
|
||||||||
Level 1 total
|
2,767,054
|
|
|
516
|
|
|
(312
|
)
|
|
2,767,258
|
|
|
2,675,528
|
|
|
22,788
|
|
|
—
|
|
|
68,942
|
|
||||||||
Level 2:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Municipal notes and bonds
|
152,378
|
|
|
37
|
|
|
(279
|
)
|
|
152,136
|
|
|
—
|
|
|
152,136
|
|
|
—
|
|
|
—
|
|
||||||||
Government-sponsored enterprises
|
110,963
|
|
|
—
|
|
|
(201
|
)
|
|
110,762
|
|
|
99,934
|
|
|
10,828
|
|
|
—
|
|
|
—
|
|
||||||||
Foreign government bonds
|
19,986
|
|
|
—
|
|
|
(1
|
)
|
|
19,985
|
|
|
19,985
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Corporate notes and bonds
|
516,955
|
|
|
95
|
|
|
(1,184
|
)
|
|
515,866
|
|
|
265,081
|
|
|
250,785
|
|
|
—
|
|
|
—
|
|
||||||||
Mortgage backed securities - residential
|
804
|
|
|
—
|
|
|
(3
|
)
|
|
801
|
|
|
—
|
|
|
801
|
|
|
—
|
|
|
—
|
|
||||||||
Level 2 total
|
801,086
|
|
|
132
|
|
|
(1,668
|
)
|
|
799,550
|
|
|
385,000
|
|
|
414,550
|
|
|
—
|
|
|
—
|
|
||||||||
Total
|
$
|
5,276,170
|
|
|
$
|
648
|
|
|
$
|
(1,980
|
)
|
|
$
|
5,274,838
|
|
|
$
|
4,512,257
|
|
|
$
|
437,338
|
|
|
$
|
256,301
|
|
|
$
|
68,942
|
|
|
June 25, 2017
|
||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
(Reported Within)
|
|||||||||||||||||||||||
Cost
|
|
Unrealized
Gain |
|
Unrealized
(Loss) |
|
Fair Value
|
|
Cash and
Cash Equivalents |
|
Investments
|
|
Restricted
Cash & Investments |
|
Other
Assets |
|||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||||||
Cash
|
$
|
551,308
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
551,308
|
|
|
$
|
545,130
|
|
|
$
|
—
|
|
|
$
|
6,178
|
|
|
$
|
—
|
|
Time deposit
|
640,666
|
|
|
—
|
|
|
—
|
|
|
640,666
|
|
|
390,639
|
|
|
—
|
|
|
250,027
|
|
|
—
|
|
||||||||
Level 1:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Money market funds
|
1,423,417
|
|
|
—
|
|
|
—
|
|
|
1,423,417
|
|
|
1,423,417
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
U.S. Treasury and agencies
|
783,848
|
|
|
684
|
|
|
(2,111
|
)
|
|
782,421
|
|
|
8,297
|
|
|
774,124
|
|
|
—
|
|
|
—
|
|
||||||||
Mutual funds
|
53,247
|
|
|
3,007
|
|
|
—
|
|
|
56,254
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
56,254
|
|
||||||||
Level 1 total
|
2,260,512
|
|
|
3,691
|
|
|
(2,111
|
)
|
|
2,262,092
|
|
|
1,431,714
|
|
|
774,124
|
|
|
—
|
|
|
56,254
|
|
||||||||
Level 2:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Municipal notes and bonds
|
194,575
|
|
|
308
|
|
|
(7
|
)
|
|
194,876
|
|
|
—
|
|
|
194,876
|
|
|
—
|
|
|
—
|
|
||||||||
U.S. Treasury and agencies
|
12,795
|
|
|
—
|
|
|
(167
|
)
|
|
12,628
|
|
|
—
|
|
|
12,628
|
|
|
—
|
|
|
—
|
|
||||||||
Government-sponsored enterprises
|
24,502
|
|
|
—
|
|
|
(6
|
)
|
|
24,496
|
|
|
—
|
|
|
24,496
|
|
|
—
|
|
|
—
|
|
||||||||
Foreign government bonds
|
62,917
|
|
|
219
|
|
|
(114
|
)
|
|
63,022
|
|
|
—
|
|
|
63,022
|
|
|
—
|
|
|
—
|
|
||||||||
Corporate notes and bonds
|
2,433,622
|
|
|
4,654
|
|
|
(1,840
|
)
|
|
2,436,436
|
|
|
10,051
|
|
|
2,426,385
|
|
|
—
|
|
|
—
|
|
||||||||
Mortgage backed securities - residential
|
102,760
|
|
|
87
|
|
|
(489
|
)
|
|
102,358
|
|
|
—
|
|
|
102,358
|
|
|
—
|
|
|
—
|
|
||||||||
Mortgage backed securities - commercial
|
65,828
|
|
|
9
|
|
|
(98
|
)
|
|
65,739
|
|
|
—
|
|
|
65,739
|
|
|
—
|
|
|
—
|
|
||||||||
Level 2 total
|
2,896,999
|
|
|
5,277
|
|
|
(2,721
|
)
|
|
2,899,555
|
|
|
10,051
|
|
|
2,889,504
|
|
|
—
|
|
|
—
|
|
||||||||
Total
|
$
|
6,349,485
|
|
|
$
|
8,968
|
|
|
$
|
(4,832
|
)
|
|
$
|
6,353,621
|
|
|
$
|
2,377,534
|
|
|
$
|
3,663,628
|
|
|
$
|
256,205
|
|
|
$
|
56,254
|
|
|
June 24, 2018
|
||||||||||||||||||||||
Unrealized Losses
Less than 12 Months |
|
Unrealized Losses
12 Months or Greater |
|
Total
|
|||||||||||||||||||
Fair Value
|
|
Gross
Unrealized Loss |
|
Fair Value
|
|
Gross
Unrealized Loss |
|
Fair Value
|
|
Gross
Unrealized Loss |
|||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
U.S. Treasury and agencies
|
$
|
332,903
|
|
|
$
|
(100
|
)
|
|
$
|
11,026
|
|
|
$
|
(70
|
)
|
|
$
|
343,929
|
|
|
$
|
(170
|
)
|
Municipal notes and bonds
|
141,139
|
|
|
(279
|
)
|
|
—
|
|
|
—
|
|
|
141,139
|
|
|
(279
|
)
|
||||||
Mutual funds
|
25,312
|
|
|
(142
|
)
|
|
—
|
|
|
—
|
|
|
25,312
|
|
|
(142
|
)
|
||||||
Government-sponsored enterprises
|
110,722
|
|
|
(201
|
)
|
|
—
|
|
|
—
|
|
|
110,722
|
|
|
(201
|
)
|
||||||
Foreign government bonds
|
19,985
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
19,985
|
|
|
(1
|
)
|
||||||
Corporate notes and bonds
|
161,813
|
|
|
(1,092
|
)
|
|
14,928
|
|
|
(92
|
)
|
|
176,741
|
|
|
(1,184
|
)
|
||||||
Mortgage backed securities - residential
|
801
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
801
|
|
|
(3
|
)
|
||||||
|
$
|
792,675
|
|
|
$
|
(1,818
|
)
|
|
$
|
25,954
|
|
|
$
|
(162
|
)
|
|
$
|
818,629
|
|
|
$
|
(1,980
|
)
|
|
Cost
|
|
Estimated
Fair Value |
||||
|
(in thousands)
|
||||||
Due in one year or less
|
$
|
4,312,694
|
|
|
$
|
4,312,352
|
|
Due after one year through five years
|
181,681
|
|
|
180,352
|
|
||
Due in more than five years
|
4,863
|
|
|
4,828
|
|
||
|
$
|
4,499,238
|
|
|
$
|
4,497,532
|
|
|
Notional Value
|
||||||||||||||
|
Derivatives Designated as
Hedging Instruments: |
|
Derivatives Not Designated as
Hedging Instruments: |
||||||||||||
|
|
||||||||||||||
|
(in thousands)
|
||||||||||||||
Foreign currency forward contracts
|
|
|
|
|
|
|
|
||||||||
|
Buy Contracts
|
|
Sell Contracts
|
|
Buy Contracts
|
|
Sell Contracts
|
||||||||
Japanese yen
|
$
|
—
|
|
|
$
|
568,970
|
|
|
$
|
—
|
|
|
$
|
267,367
|
|
Euro
|
102,557
|
|
|
—
|
|
|
45,298
|
|
|
—
|
|
||||
Korean won
|
28,887
|
|
|
—
|
|
|
—
|
|
|
99,408
|
|
||||
Taiwan dollar
|
—
|
|
|
—
|
|
|
31,859
|
|
|
—
|
|
||||
Singapore dollar
|
—
|
|
|
—
|
|
|
21,376
|
|
|
—
|
|
||||
British pound sterling
|
—
|
|
|
—
|
|
|
15,865
|
|
|
—
|
|
||||
Swiss franc
|
—
|
|
|
—
|
|
|
14,899
|
|
|
—
|
|
||||
Indian rupee
|
—
|
|
|
—
|
|
|
3,220
|
|
|
—
|
|
||||
Chinese renminbi
|
—
|
|
|
—
|
|
|
2,467
|
|
|
—
|
|
||||
|
$
|
131,444
|
|
|
$
|
568,970
|
|
|
$
|
134,984
|
|
|
$
|
366,775
|
|
Foreign currency option contracts
|
|
|
|
|
|
|
|
||||||||
|
Buy Put
|
|
Sell Call
|
|
Buy Put
|
|
Sell Put
|
||||||||
Japanese yen
(1)
|
$
|
9,050
|
|
|
$
|
9,709
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
June 24, 2018
|
|
June 25, 2017
|
||||||||||||||||||||
Fair Value of Derivative Instruments (Level 2)
|
|
Fair Value of Derivative Instruments (Level 2)
|
|||||||||||||||||||||
Derivative Assets
|
|
Derivative Liabilities
|
|
Derivative Assets
|
|
Derivative Liabilities
|
|||||||||||||||||
Balance
Sheet Location |
|
Fair
Value |
|
Balance
Sheet Location |
|
Fair
Value |
|
Balance
Sheet Location |
|
Fair
Value |
|
Balance
Sheet Location |
|
Fair
Value |
|||||||||
|
(in thousands)
|
||||||||||||||||||||||
Derivatives designated as hedging instrument
s:
|
|||||||||||||||||||||||
Foreign exchange contracts
|
Prepaid
expense and other assets |
|
$
|
7,581
|
|
|
Accrued expenses and other current liabilities
|
|
$
|
8,866
|
|
|
Prepaid
expense and other assets |
|
$
|
8,061
|
|
|
Accrued expenses and other current liabilities
|
|
$
|
2,916
|
|
Interest rate contracts, short-term
|
|
|
—
|
|
|
Accrued expenses and other current liabilities
|
|
7,468
|
|
|
|
|
—
|
|
|
Accrued expenses and other current liabilities
|
|
2,833
|
|
||||
Interest rate contracts, long-term
|
|
|
—
|
|
|
Other long-term liabilities
|
|
23,720
|
|
|
|
|
—
|
|
|
Other long-term liabilities
|
|
7,269
|
|
||||
Derivatives not designated as hedging instrument
s:
|
|
|
|
|
|
|
|
|
|||||||||||||||
Foreign exchange contracts
|
Prepaid
expense and other assets |
|
111
|
|
|
Accrued expenses and other current liabilities
|
|
32
|
|
|
Prepaid
expense and other assets |
|
213
|
|
|
Accrued expenses and other current liabilities
|
|
342
|
|
||||
Total derivatives
|
|
|
$
|
7,692
|
|
|
|
|
$
|
40,086
|
|
|
|
|
$
|
8,274
|
|
|
|
|
$
|
13,360
|
|
|
|
Year Ended June 24, 2018
|
||||||
|
Location of
Gain (Loss) Recognized in or Reclassified into Income |
Gain (Loss)
Recognized in AOCI |
|
Gain (Loss)
Reclassified from AOCI into Income |
||||
|
|
|||||||
Derivatives in Cash Flow Hedging Relationships
|
(in thousands)
|
|||||||
Foreign exchange contracts
|
Revenue
|
$
|
(8,305
|
)
|
|
$
|
(11,284
|
)
|
Foreign exchange contracts
|
Cost of goods sold
|
57
|
|
|
5,218
|
|
||
Foreign exchange contracts
|
SG&A
|
558
|
|
|
2,654
|
|
||
Foreign exchange contracts
|
Other expense, net
|
—
|
|
|
—
|
|
||
|
|
$
|
(7,690
|
)
|
|
$
|
(3,412
|
)
|
Derivatives in Fair Value Hedging Relationships
|
|
|
|
|||||
Interest rate contracts
|
Other expense, net
|
$
|
—
|
|
|
$
|
(126
|
)
|
|
|
Year Ended June 25, 2017
|
||||||||||
|
Location of
Gain (Loss) Recognized in or Reclassified into Income |
Effective Portion
|
|
Ineffective
Portion and Amount Excluded from Effectiveness |
||||||||
Derivatives Designated as
Hedging Instruments |
Gain (Loss)
Recognized in AOCI |
|
Gain (Loss)
Reclassified from AOCI into Income |
|
Gain (Loss)
Recognized in Income |
|||||||
|
|
(in thousands)
|
||||||||||
Foreign exchange contracts
|
Revenue
|
$
|
2,927
|
|
|
$
|
(12,000
|
)
|
|
$
|
6,982
|
|
Foreign exchange contracts
|
Cost of goods sold
|
2,859
|
|
|
666
|
|
|
(686
|
)
|
|||
Foreign exchange contracts
|
SG&A
|
1,128
|
|
|
71
|
|
|
(267
|
)
|
|||
Foreign exchange contracts
|
Other expense, net
|
—
|
|
|
—
|
|
|
(82
|
)
|
|||
Interest rate contracts
|
Other expense, net
|
—
|
|
|
1,727
|
|
|
—
|
|
|||
|
|
$
|
6,914
|
|
|
$
|
(9,536
|
)
|
|
$
|
5,947
|
|
|
Year Ended
|
|||||||
June 24, 2018
|
|
June 25, 2017
|
||||||
Derivatives Not Designated as Hedging Instruments:
|
Location of Gain
Recognized in Income |
Gain
Recognized in Income |
|
Gain
Recognized in Income |
||||
|
|
(in thousands)
|
||||||
Foreign exchange contracts
|
Other income
|
$
|
7,756
|
|
|
$
|
523
|
|
|
June 24,
2018 |
|
June 25,
2017 |
||||
|
(in thousands)
|
||||||
Raw materials
|
$
|
916,438
|
|
|
$
|
625,600
|
|
Work-in-process
|
222,921
|
|
|
213,066
|
|
||
Finished goods
|
736,803
|
|
|
394,250
|
|
||
|
$
|
1,876,162
|
|
|
$
|
1,232,916
|
|
|
June 24,
2018 |
|
June 25,
2017 |
||||
|
(in thousands)
|
||||||
Manufacturing and engineering equipment
|
$
|
911,140
|
|
|
$
|
819,239
|
|
Computer equipment and software
|
182,451
|
|
|
166,441
|
|
||
Land
|
46,155
|
|
|
46,155
|
|
||
Buildings and improvements
|
530,032
|
|
|
358,081
|
|
||
Office equipment, furniture and fixtures
|
66,378
|
|
|
52,959
|
|
||
|
1,736,156
|
|
|
1,442,875
|
|
||
Less: accumulated depreciation and amortization
|
(833,609
|
)
|
|
(757,280
|
)
|
||
|
$
|
902,547
|
|
|
$
|
685,595
|
|
|
June 24, 2018
|
|
June 25, 2017
|
||||||||||||||||||||
|
Gross
|
|
Accumulated
Amortization |
|
Net
|
|
Gross
|
|
Accumulated
Amortization |
|
Net
|
||||||||||||
|
(in thousands)
|
||||||||||||||||||||||
Customer relationships
|
$
|
630,220
|
|
|
$
|
(433,309
|
)
|
|
$
|
196,911
|
|
|
$
|
615,164
|
|
|
$
|
(366,439
|
)
|
|
$
|
248,725
|
|
Existing technology
|
669,520
|
|
|
(576,844
|
)
|
|
92,676
|
|
|
643,196
|
|
|
(487,056
|
)
|
|
156,140
|
|
||||||
Patents and other intangible assets
|
99,767
|
|
|
(71,518
|
)
|
|
28,249
|
|
|
73,067
|
|
|
(66,937
|
)
|
|
6,130
|
|
||||||
Total intangible assets
|
$
|
1,399,507
|
|
|
$
|
(1,081,671
|
)
|
|
$
|
317,836
|
|
|
$
|
1,331,427
|
|
|
$
|
(920,432
|
)
|
|
$
|
410,995
|
|
Fiscal Year
|
Amount
|
||
|
(in thousands)
|
||
2019
|
$
|
125,921
|
|
2020
|
60,792
|
|
|
2021
|
58,019
|
|
|
2022
|
54,492
|
|
|
2023
|
10,967
|
|
|
Thereafter
|
7,645
|
|
|
|
$
|
317,836
|
|
|
June 24,
2018 |
|
June 25,
2017 |
||||
|
(in thousands)
|
||||||
Accrued compensation
|
$
|
506,471
|
|
|
$
|
447,363
|
|
Warranty reserves
|
192,480
|
|
|
161,981
|
|
||
Income and other taxes payable
|
185,384
|
|
|
95,127
|
|
||
Dividend payable
|
174,372
|
|
|
72,738
|
|
||
Other
|
250,502
|
|
|
192,152
|
|
||
|
$
|
1,309,209
|
|
|
$
|
969,361
|
|
|
June 24, 2018
|
|
June 25, 2017
|
|
||||||||||
|
Amount
(in thousands)
|
|
Effective Interest Rate
|
|
Amount
(in thousands)
|
|
Effective Interest Rate
|
|
||||||
Fixed-rate 1.25% Convertible Notes Due May 15, 2018 (“2018 Notes”)
|
—
|
|
(1)
|
5.27
|
%
|
|
447,436
|
|
(2)
|
5.27
|
%
|
|
||
Fixed-rate 2.75% Senior Notes Due March 15, 2020 (“2020 Notes”)
|
500,000
|
|
|
2.88
|
%
|
|
500,000
|
|
|
2.88
|
%
|
|
||
Fixed-rate 2.80% Senior Notes Due June 15, 2021 (“2021 Notes”)
|
800,000
|
|
|
2.95
|
%
|
|
800,000
|
|
|
2.95
|
%
|
|
||
Fixed-rate 3.80% Senior Notes Due March 15, 2025 (“2025 Notes”)
|
500,000
|
|
|
3.87
|
%
|
|
500,000
|
|
|
3.87
|
%
|
|
||
Fixed-rate 2.625% Convertible Notes Due May 15, 2041 (“2041 Notes”)
|
326,953
|
|
(2)
|
4.28
|
%
|
|
631,074
|
|
(2)
|
4.28
|
%
|
|
||
Commercial paper
|
360,000
|
|
|
2.33
|
%
|
(3)
|
—
|
|
|
—
|
%
|
|
||
Total debt outstanding, at par
|
2,486,953
|
|
|
|
|
2,878,510
|
|
|
|
|
||||
Unamortized discount
|
(85,196
|
)
|
|
|
|
(178,589
|
)
|
|
|
|
||||
Fair value adjustment - interest rate contracts
|
(31,189
|
)
|
|
|
|
(10,102
|
)
|
|
|
|
||||
Unamortized bond issuance costs
|
(1,820
|
)
|
|
|
|
(3,161
|
)
|
|
|
|
||||
Total debt outstanding, at carrying value
|
$
|
2,368,748
|
|
|
|
|
$
|
2,686,658
|
|
|
|
|
||
Reported as:
|
|
|
|
|
|
|
|
|
||||||
Current portion of long-term debt
|
$
|
608,532
|
|
(2)
|
|
|
$
|
907,827
|
|
(2)
|
|
|
||
Long-term debt
|
1,760,216
|
|
|
|
|
1,778,831
|
|
|
|
|
||||
Total debt outstanding, at carrying value
|
$
|
2,368,748
|
|
|
|
|
$
|
2,686,658
|
|
|
|
|
|
June 24, 2018
|
|
June 25, 2017
|
||||||||
|
2041
Notes |
|
2018
Notes |
|
2041
Notes |
||||||
|
(in thousands, except years, percentages, conversion rate, and conversion price)
|
||||||||||
Carrying amount of permanent equity component, net of tax
|
$
|
159,120
|
|
|
$
|
89,604
|
|
|
$
|
156,374
|
|
Carrying amount of temporary equity component, net of tax
|
$
|
78,192
|
|
|
$
|
15,186
|
|
|
$
|
154,675
|
|
Remaining amortization period (years)
|
22.9
|
|
|
0.8
|
|
|
23.8
|
|
|||
Fair Value of Notes (Level 2)
|
$
|
1,736,653
|
|
|
|
|
|
||||
Conversion rate (shares of common stock per $1,000 principal amount of notes)
|
30.1361
|
|
|
|
|
|
|||||
Conversion price (per share of common stock)
|
$
|
33.18
|
|
|
|
|
|
||||
If-converted value in excess of par value
|
$
|
1,394,383
|
|
|
|
|
|
||||
Estimated share dilution using average quarterly stock price of
$195.01
per share
|
8,176
|
|
|
|
|
|
|
2018 Notes
|
|
|
(shares in thousands)
|
|
Warrants:
|
|
|
Underlying shares
|
7,557
|
|
Estimated share dilution using average quarterly stock price $195.01 per share
|
4,770
|
|
Exercise price
|
$71.91
|
|
Expiration date range
|
August 15 - October 24, 2018
|
|
|
Remaining Amortization period
|
|
Fair Value of Notes (Level 2)
|
||
|
(years)
|
|
(in thousands)
|
||
2020 Notes
|
1.7
|
|
$
|
497,250
|
|
2021 Notes
|
3.0
|
|
$
|
786,856
|
|
2025 Notes
|
6.7
|
|
$
|
497,560
|
|
|
Year Ended
|
||||||||||
|
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||||
|
(in thousands)
|
||||||||||
Contractual interest coupon
|
$
|
77,091
|
|
|
$
|
95,195
|
|
|
$
|
63,053
|
|
Amortization of interest discount
|
12,225
|
|
|
22,873
|
|
|
35,206
|
|
|||
Amortization of issuance costs
|
2,034
|
|
|
2,414
|
|
|
35,315
|
|
|||
Effect of interest rate contracts, net
|
3
|
|
|
(4,756
|
)
|
|
359
|
|
|||
Total interest cost recognized
|
$
|
91,353
|
|
|
$
|
115,726
|
|
|
$
|
133,933
|
|
Payments Due by Fiscal Year:
|
Capital
Leases |
||
|
(in thousands)
|
||
2019
|
$
|
3,948
|
|
2020
|
4,491
|
|
|
2021
|
4,854
|
|
|
2022
|
8,765
|
|
|
2023
|
4,351
|
|
|
Thereafter
|
37,707
|
|
|
Total
|
64,116
|
|
|
Interest on capital leases
|
16,272
|
|
|
Current portion of capital leases
|
1,498
|
|
|
Long-term portion of capital leases
|
$
|
46,346
|
|
Payments Due by Fiscal Year:
|
Operating
Leases |
||
|
(in thousands)
|
||
2019
|
$
|
22,117
|
|
2020
|
18,672
|
|
|
2021
|
13,963
|
|
|
2022
|
4,879
|
|
|
2023
|
3,677
|
|
|
Thereafter
|
11,035
|
|
|
Total
|
$
|
74,343
|
|
Payments Due by Fiscal Year:
|
Purchase
Obligations |
||
|
(in thousands)
|
||
2019
|
$
|
353,295
|
|
2020
|
6,281
|
|
|
2021
|
6,036
|
|
|
2022
|
3,287
|
|
|
2023
|
3,165
|
|
|
Thereafter
|
162
|
|
|
Total
|
$
|
372,226
|
|
|
Year Ended
|
||||||
June 24,
2018 |
|
June 25,
2017 |
|||||
|
(in thousands)
|
||||||
Balance at beginning of period
|
$
|
161,981
|
|
|
$
|
100,321
|
|
Warranties issued during the period
|
235,252
|
|
|
188,813
|
|
||
Settlements made during the period
|
(196,680
|
)
|
|
(135,213
|
)
|
||
Changes in liability for pre-existing warranties
|
(8,073
|
)
|
|
8,060
|
|
||
Balance at end of period
|
$
|
192,480
|
|
|
$
|
161,981
|
|
Period
|
Total Number
of Shares Repurchased |
|
Total
Cost of Repurchase |
|
Average
Price Paid per Share (1) |
|
Amount Available
Under Repurchase Program |
|||||||
|
(in thousands, except per share data)
|
|||||||||||||
Available balance as of June 25, 2017
|
|
|
|
|
|
|
$
|
282,141
|
|
|||||
Quarter ended September 24, 2017
|
1,779
|
|
|
$
|
157,938
|
|
|
$
|
158.40
|
|
|
$
|
124,203
|
|
Board authorization, $2.0 billion increase, November 2017
|
|
|
|
|
|
|
$
|
2,124,203
|
|
|||||
Quarter ended December 24, 2017
|
3,709
|
|
|
$
|
1,089,744
|
|
|
$
|
196.28
|
|
|
$
|
1,034,459
|
|
Board authorization, $2.0 billion increase, March 2018
|
|
|
|
|
|
|
$
|
3,034,459
|
|
|||||
Quarter ended March 25, 2018
|
1,019
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,034,459
|
|
Quarter ended June 24, 2018
|
7,702
|
|
|
$
|
1,300,821
|
|
|
$
|
191.03
|
|
|
$
|
1,733,638
|
|
|
Accumulated
Foreign Currency Translation Adjustment |
|
Accumulated
Unrealized Gain or Loss on Cash Flow Hedges |
|
Accumulated
Unrealized Holding Gain or Loss on Available-For- Sale Investments |
|
Accumulated
Unrealized Components of Defined Benefit Plans |
|
Total
|
||||||||||
|
(in thousands)
|
||||||||||||||||||
Balance as of June 25, 2017
|
$
|
(42,371
|
)
|
|
$
|
(811
|
)
|
|
$
|
1,106
|
|
|
$
|
(19,624
|
)
|
|
$
|
(61,700
|
)
|
Other comprehensive income (loss) before reclassifications
|
5,703
|
|
|
(6,960
|
)
|
|
(45,382
|
)
|
|
129
|
|
|
(46,510
|
)
|
|||||
Losses (gains) reclassified from accumulated other comprehensive income (loss) to net income
|
3,946
|
|
(2)
|
3,729
|
|
(1)
|
8,996
|
|
(2)
|
—
|
|
|
16,671
|
|
|||||
Securities impairment
|
—
|
|
|
—
|
|
|
34,090
|
|
|
—
|
|
|
34,090
|
|
|||||
Net current-period other comprehensive income (loss)
|
9,649
|
|
|
(3,231
|
)
|
|
(2,296
|
)
|
|
129
|
|
|
4,251
|
|
|||||
Balance as of June 24, 2018
|
$
|
(32,722
|
)
|
|
$
|
(4,042
|
)
|
|
$
|
(1,190
|
)
|
|
$
|
(19,495
|
)
|
|
$
|
(57,449
|
)
|
(1)
|
Amount of after-tax gain reclassified from accumulated other comprehensive income into net income located in revenue:
$10,030
loss; cost of goods sold:
$4,393
gain; selling, general, and administrative expenses:
$1,994
gain; and other income and expense:
$86
loss.
|
(2)
|
Amount of after-tax gain reclassified from accumulated other comprehensive income into net income located in other expense, net.
|
|
Year Ended
|
||||||||||
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
|||||||
Revenue:
|
(in thousands)
|
||||||||||
Korea
|
$
|
3,832,798
|
|
|
$
|
2,480,329
|
|
|
$
|
1,057,331
|
|
Japan
|
1,882,799
|
|
|
1,041,969
|
|
|
983,821
|
|
|||
China
|
1,784,436
|
|
|
1,023,195
|
|
|
1,039,951
|
|
|||
Taiwan
|
1,397,978
|
|
|
2,095,669
|
|
|
1,485,037
|
|
|||
United States
|
820,438
|
|
|
629,937
|
|
|
495,123
|
|
|||
Southeast Asia
|
781,360
|
|
|
401,877
|
|
|
605,236
|
|
|||
Europe
|
577,189
|
|
|
340,644
|
|
|
219,394
|
|
|||
Total revenue
|
$
|
11,076,998
|
|
|
$
|
8,013,620
|
|
|
$
|
5,885,893
|
|
|
June 24,
2018 |
|
June 25,
2017 |
|
June 26,
2016 |
||||||
Long-lived assets:
|
(in thousands)
|
||||||||||
United States
|
$
|
784,469
|
|
|
$
|
575,264
|
|
|
$
|
529,316
|
|
Europe
|
73,336
|
|
|
77,211
|
|
|
81,377
|
|
|||
Korea
|
24,312
|
|
|
19,982
|
|
|
17,281
|
|
|||
Taiwan
|
7,922
|
|
|
7,970
|
|
|
8,647
|
|
|||
China
|
5,466
|
|
|
1,906
|
|
|
1,339
|
|
|||
Southeast Asia
|
3,715
|
|
|
2,179
|
|
|
668
|
|
|||
Japan
|
3,327
|
|
|
1,083
|
|
|
980
|
|
|||
|
$
|
902,547
|
|
|
$
|
685,595
|
|
|
$
|
639,608
|
|
|
Purchase Price Allocation
|
||
|
(in thousands)
|
||
Intangible assets
|
$
|
48,500
|
|
Assets acquired (including cash of $8.7 million)
|
11,463
|
|
|
Goodwill
|
98,917
|
|
|
Liabilities assumed
|
(21,269
|
)
|
|
Fair value of net assets acquired
|
$
|
137,611
|
|
|
Fair Value
|
|
Weighted-Average Estimated Useful Life
|
||
|
(In thousands)
|
|
(In years)
|
||
Existing technology
|
$
|
26,200
|
|
|
6.0
|
Customer relationships
|
15,000
|
|
|
6.0
|
|
Trade names and other intangible assets
|
7,300
|
|
|
6.4
|
|
Total identified intangible assets
|
$
|
48,500
|
|
|
6.0
|
Item 9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item 9B.
|
Other Information
|
Item 10.
|
Directors, Executive Officers and Corporate Governance
|
Item 11.
|
Executive Compensation
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence
|
Item 14.
|
Principal Accounting Fees and Services
|
Item 15.
|
Exhibits, Financial Statement Schedules
|
(a)
|
The following documents are filed as part of this Annual Report on Form 10-K.
|
|
Page
|
1. Index to Financial Statements
|
|
Consolidated Statements of Operations — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Consolidated Statements of Comprehensive Income — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Consolidated Balance Sheets — June 24, 2018, and June 25, 2017
|
|
Consolidated Statements of Cash Flows — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Consolidated Statements of Stockholders’ Equity — Years Ended June 24, 2018, June 25, 2017, and June 26, 2016
|
|
Notes to Consolidated Financial Statements
|
|
Reports of Independent Registered Public Accounting Firm
|
|
|
|
2. Index to Financial Statement Schedules
|
|
|
|
Schedules have been omitted since they are not applicable, not required, not material, or the information is included elsewhere herein.
|
|
|
|
Exhibit
|
|
Description
|
2.1
|
|
|
2.2
|
|
|
3.1
|
|
|
3.2
|
|
|
4.1
|
|
|
4.2
|
|
|
4.3
|
|
|
4.4
|
|
|
4.5
|
|
|
10.1*
|
|
Form of Indemnification Agreement which is incorporated by reference to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended April 3, 1988 (SEC File No. 000-12933).
|
10.2*
|
|
|
10.3*
|
|
|
10.4*
|
|
|
10.5*
|
|
Exhibit
|
|
Description
|
10.6*
|
|
|
10.7
|
|
|
10.8
|
|
|
10.9*
|
|
|
10.10*
|
|
|
10.11*
|
|
|
10.12*
|
|
|
10.13*
|
|
|
10.14*
|
|
|
10.15*
|
|
|
10.16*
|
|
|
10.17*
|
|
|
10.18*
|
|
|
10.19*
|
|
|
10.20*
|
|
Exhibit
|
|
Description
|
10.21*
|
|
|
10.22*
|
|
|
10.23*
|
|
|
10.24*
|
|
|
10.25*
|
|
|
10.26*
|
|
|
10.27*
|
|
|
10.28*
|
|
|
10.29*
|
|
|
10.30
|
|
|
10.31
|
|
|
10.32*
|
|
|
10.33*
|
|
|
10.34*
|
|
|
10.35*
|
|
|
10.36*
|
|
|
10.37*
|
|
Exhibit
|
|
Description
|
10.38*
|
|
|
10.39
|
|
|
10.40
|
|
|
10.41
|
|
|
10.42
|
|
|
10.43*
|
|
|
10.44*
|
|
|
10.45*
|
|
|
10.46*
|
|
|
10.47
|
|
|
10.48
|
|
|
10.49*
|
|
|
10.50*
|
|
|
10.51*
|
|
|
10.52*
|
|
|
10.53
|
|
Exhibit
|
|
Description
|
10.54*
|
|
|
10.55*
|
|
|
20
|
|
|
21
|
|
|
23
|
|
|
24
|
|
Power of Attorney (See Signature page)
|
31.1
|
|
|
31.2
|
|
|
32.1
|
|
|
32.2
|
|
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Indicates management contract or compensatory plan or arrangement.
|
Date:
|
August 14, 2018
|
|
LAM RESEARCH CORPORATION
(Registrant)
|
|
|||
By:
|
/s/ Martin B. Anstice
|
||
Martin B. Anstice
|
|||
Chief Executive Officer
|
Signatures
|
|
Title
|
|
Date
|
Principal Executive Officer
|
|
|
|
|
|
|
|
||
/s/ Martin B. Anstice
|
|
Chief Executive Officer and Director
|
|
August 14, 2018
|
Martin B. Anstice
|
|
|
|
|
|
|
|
||
Principal Financial Officer and Principal
Accounting Officer
|
|
|
|
|
|
|
|
||
/s/ Douglas R. Bettinger
|
|
Executive Vice President, Chief Financial Officer, and Chief Accounting Officer
|
|
August 14, 2018
|
Douglas R. Bettinger
|
|
|
|
|
|
|
|
||
Other Directors
|
|
|
|
|
/s/ Stephen G. Newberry
|
|
Chairman
|
|
August 14, 2018
|
Stephen G. Newberry
|
|
|
||
|
|
|
|
|
/s/ Eric K. Brandt
|
|
Director
|
|
August 14, 2018
|
Eric K. Brandt
|
|
|
||
|
|
|
|
|
/s/ Michael R. Cannon
|
|
Director
|
|
August 14, 2018
|
Michael R. Cannon
|
|
|
|
|
|
|
|
||
/a/ Youssef A. El-Mansy
|
|
Director
|
|
August 14, 2018
|
Youssef A. El-Mansy
|
|
|
||
|
|
|
|
|
/s/ Christine A. Heckart
|
|
Director
|
|
August 14, 2018
|
Christine A. Heckart
|
|
|
||
|
|
|
|
|
/s/ Catherine P. Lego
|
|
Director
|
|
August 14, 2018
|
Catherine P. Lego
|
|
|
||
|
|
|
|
|
/s/ Abhi Talwalkar
|
|
Director
|
|
August 14, 2018
|
Abhijit Y. Talwalkar
|
|
|
|
|
|
|
|
|
|
/s/ Lih Shyng Tsai
|
|
Director
|
|
August 14, 2018
|
Lih Shyng (Rick L.) Tsai
|
|
|
|
|
SUBSIDIARY (as of August 14, 2018)
|
STATE OR OTHER JURISDICTION OF OPERATION
|
Lam Research AG
|
Austria
|
Lam Research Management GmbH
|
Austria
|
IPEC FSC Ltd
|
Barbados
|
IPEC International Sales FSC Ltd
|
Barbados
|
Lam Research Belgium BVBA
|
Belgium
|
Novellus Systems, Inc.
|
California, United States
|
Novellus Systems International, LLC
|
California, United States
|
Lam Research International Holdings Ltd.
|
Cayman Islands
|
Lam Research International Holdings II Ltd.
|
Cayman Islands
|
Lam Research Capital Ltd.
|
Cayman Islands
|
Lam Research (Shanghai) Co., Ltd.
|
China
|
Lam Research Service Co., Ltd.
|
China
|
Novellus Systems Semiconductor Equipment Co. Ltd. (Shanghai) **
|
China
|
Coventor, Inc.
|
Delaware, United States
|
Lam Research Capital, LLC
|
Delaware, United States
|
Lam Research International Holding Company
|
Delaware, United States
|
Novellus International Holdco, LLC.
|
Delaware, United States
|
Silfex, Inc.
|
Delaware, United States
|
SpeedFam-IPEC International Services, LLC
|
Delaware, United States
|
Coventor Sarl
|
France
|
Lam Research SAS
|
France
|
Lam Research GmbH
|
Germany
|
Lam Research (H.K.) Limited
|
Hong Kong
|
Lam Research Illinois IAG, Inc
|
Illinois, United States
|
Lam Research (India) Private Ltd.
|
India
|
Lam Research (Ireland) Limited
|
Ireland
|
Gasonics Israel International Limited
|
Israel
|
Lam Research (Israel) Ltd.
|
Israel
|
Lam Research Services Ltd.
|
Israel
|
Lam Research S.r.l.
|
Italy
|
Coventor Japan Godo Kaisha
|
Japan
|
Lam Research Co., Ltd.
|
Japan
|
Lam Research Luxembourg S.à.r.l.
|
Luxembourg
|
Lam Research Malaysia Sdn. Bhd.
|
Malaysia
|
Lam Research B.V.
|
Netherlands
|
Lam Research International B.V.
|
Netherlands
|
Novellus Systems International B.V.
|
Netherlands
|
Coventor Korea Limited
|
Republic of Korea
|
Lam Research Korea Limited
|
Republic of Korea
|
Lam Research Korea LLC YH
|
Republic of Korea
|
Lam Research Manufacturing Korea, LLC
|
Republic of Korea
|
Lam Research Singapore Pte Ltd.
|
Singapore
|
Novellus Singapore Holdings Pte. Ltd.
|
Singapore
|
SUBSIDIARY (as of August 14, 2018)
|
STATE OR OTHER JURISDICTION OF OPERATION
|
Lam Research Holding GmbH
|
Switzerland
|
Lam Research International Sàrl
|
Switzerland
|
Coventor, Inc. Representative Office Taiwan
|
Taiwan
|
Lam Research Co., Ltd.
|
Taiwan
|
Lam Research (H.K.) Limited, Taiwan Branch
|
Taiwan
|
Lam Research Ltd.
|
United Kingdom
|
Metryx, Ltd.
|
United Kingdom
|
1.
|
Registration Statement (Form S-4 No. 333-30545) of Lam Research Corporation and in the related Prospectus;
|
2.
|
Registration Statement (Form S-4 No. 333-179267) of Lam Research Corporation and in the related Prospectus;
|
3.
|
Registration Statements (Form S-8 No. 333-66833, 333-127936, and 333-156335) pertaining to the 1999 Employee Stock Purchase Plan;
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4.
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Registration Statements (Form S-8 No. 333-84638 and 333-185641) pertaining to the Savings Plus Plan, Lam Research 401(k);
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5.
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Registration Statement (Form S-8 No. 333-138545) pertaining to the 2007 Stock Incentive Plan, as amended;
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6.
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Registration Statement (Form S-8 No. 333-181878) pertaining to the Novellus Systems, Inc. 2011 Stock Incentive Plan, Novellus Systems, Inc. Retirement Plan, and Lam Research Corporation 1999 Employee Stock Purchase Plan, as amended; and
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7.
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Registration Statement (Form S-8 No. 333-207844) pertaining to the 2015 Stock Incentive Plan of Lam Research Corporation;
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1.
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I have reviewed this Annual Report on Form 10-K of Lam Research Corporation;
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2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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August 14, 2018
|
/s/ Martin B. Anstice
|
|
Martin B. Anstice
|
|
Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K of Lam Research Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
August 14, 2018
|
/s/ Douglas R. Bettinger
|
|
Douglas R. Bettinger
|
|
Executive Vice President, Chief Financial Officer and Chief Accounting Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
August 14, 2018
|
/s/ Martin B. Anstice
|
|
Martin B. Anstice
|
|
Chief Executive Officer
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
August 14, 2018
|
/s/ Douglas R. Bettinger
|
|
Douglas R. Bettinger
|
|
Executive Vice President, Chief Financial Officer and Chief Accounting Officer
|