UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
☑QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
June 29, 201927, 2020
Or
☐TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                 to                 
Commission File Number 000-06217
intc-20200627_g1.jpg
INTEL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware94-1672743
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
Delaware94-1672743
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)
2200 Mission College Boulevard,Santa Clara,California95054-1549
(Address of principal executive offices)(Zip Code)
(408) 765-8080
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, $0.001 par valueINTCNasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ☑    No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  ☑    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large Accelerated FilerAccelerated filer  Non-accelerated filer Smaller reporting company Emerging growth company  
☑
¨¨☐☐
Large Accelerated FilerAccelerated filer  Non-accelerated filer Smaller reporting company Emerging growth company  
☑¨¨☐☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☑
As of June 29, 2019,27, 2020, the registrant had outstanding 4,4304,253 million shares of common stock.



TABLE OF CONTENTS
THE ORGANIZATION OF OUR QUARTERLY REPORT ON FORM 10-Q
The order and presentation of content in our Quarterly Report on Form 10-Q (Form 10-Q) differs from the traditional U.S. Securities and Exchange Commission (SEC)SEC Form 10-Q format. We believe that ourOur format improvesis designed to improve readability and better presentspresent how we organize and manage our business. See "Form 10-Q Cross-Reference Index" within Other Key Information for a cross-reference index to the traditional SEC Form 10-Q format. To reflect our focus on transforming from a PC-centric1 company to a data-centric company, we have presented our data-centric businesses1 first in "Segment Trends and Results" within MD&A.
We have defined certain terms and abbreviations used throughout our Form 10-Q in "Key Terms" within the Consolidated Condensed Financial Statements and Supplemental Details.
The preparation of consolidated financial statementsour Consolidated Condensed Financial Statements is in conformity with U.S. generally accepted accounting principles (GAAP). We have includedGAAP. Our Form 10-Q includes key metrics that we use to measure our business, some of which are non-GAAP measures. See these "Non-GAAP Financial Measures" within Other Key Information.
MD&A for an explanation of these measures and why management uses them and believes they provide investors with useful supplemental information.
Page
FORWARD-LOOKING STATEMENTS
1
OUR PANDEMIC RESPONSE
2
A QUARTER IN REVIEW
23
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS AND SUPPLEMENTAL DETAILS
Consolidated Condensed Statements of Income
35
Consolidated Condensed Statements of Comprehensive Income
46
Consolidated Condensed Balance Sheets
57
Consolidated Condensed Statements of Cash Flows
68
Consolidated Condensed Statements of Stockholders' Equity
79
Notes to Consolidated Condensed Financial Statements
810
Key Terms
27
MANAGEMENT'S DISCUSSION AND ANALYSIS (MD&A)
Overview
21
Revenue, Gross Margin, and Operating Expenses
22
Business UnitSegment Trends and Results
2528
Other
Consolidated Results of Operations
3135
Liquidity and Capital Resources
3240
Contractual Obligations
41
Quantitative and Qualitative Disclosures about Market Risk
3341
Non-GAAP Financial Measures
42
OTHER KEY INFORMATION
Risk Factors
3444
Controls and Procedures
3544
Non-GAAP Financial Measures
35
Issuer Purchases of Equity Securities
3644
Exhibits
3745
Form 10-Q Cross-Reference Index
3846





1 Intel's definition is included in "Key Terms" within the Consolidated Condensed Financial Statements and Supplemental Details.

Table of Contents


FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements that involve a number of risks and uncertainties. Words such as "anticipates,"anticipate," "expects,"expect," "intends,"intend," "goals,"pledge," "plans,"committed," "plan," "mission," "opportunities," "future," "upcoming," "believes," "seeks,"targeted," "estimates," "continues,"continue," "likely," "may," "might," "potentially," "will," "would," "should," "could," and variations of such words and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to future responses to and effects of COVID-19; projections of our future financial performance and demand; our anticipated growth and trends in our businesses or operations; projected growth ofand trends in markets relevant to our businesses,businesses; business plans; future products and technology and the expected availability and benefits of such products and technology, including our 10nm and 7nm process technologies, products, and product designs; expectations regarding construction projects; expected timing and impact of acquisitions, divestitures, and other significant transactions,transactions; expected completion of restructuring activities,activities; availability, uses, sufficiency, and cost of capital and capital resources, including expected returns to stockholders such as dividends and share repurchases; accounting estimates and judgments regarding reported matters, events and contingencies and our intentions with respect to such matters, events and contingencies, and the actual results thereof; future production capacity and product supply; the future purchase, use, and availability of products, components and services supplied by third parties, including third-party manufacturing services; tax-related expectations; uncertain events or assumptions,assumptions; and other characterizations of future events or circumstances are forward-looking statements. Such statements are based on management's expectations as of the date of this filing and involve many risks and uncertainties that could cause our actual results to differ materially from those expressed or implied in our forward-looking statements. Such risks and uncertainties include those described throughout this report, our 2019 Form 10-K, and our Annual Report on Form 10-K10-Q for the yearquarter ended December 29, 2018,March 28, 2020, particularly the "Risk Factors" sections of such reports. Given these risks and uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in this Form 10-Q and in other documents we file from time to time with the SEC that disclose risks and uncertainties that may affect our business. TheUnless specifically indicated otherwise, the forward-looking statements in this Form 10-Q do not reflect the potential impact of any divestitures, mergers, acquisitions, or other business combinations that hadhave not been completed as of the date of this filing. In addition, the forward-looking statements in this Form 10-Q are made as of the date of this filing, including expectations based on third-party information and projections that management believes to be reputable, and Intel does not undertake, and expressly disclaims any duty, to update such statements, whether as a result of new information, new developments, or otherwise, except to the extent that disclosure may be required by law.
INTEL UNIQUE TERMS
We use specific terms throughout this document to describe our business and results. Below are key terms and how we define them:

PLATFORM PRODUCTS
A microprocessor (processor or central processing unit (CPU)) and chipset, a stand-alone System-on-Chip (SoC), or a multichip package, based on Intel














® architecture. Platform products, or platforms, are primarily used in solutions sold through the Client Computing Group (CCG), Data Center Group (DCG), and Internet of Things Group (IOTG) segments.
ADJACENT PRODUCTSAll of our non-platform products for CCG, DCG, and IOTG, such as modem, Ethernet and silicon photonics, as well as Mobileye, Non-Volatile Memory Solutions Group (NSG), and Programmable Solutions Group (PSG) products. Combined with our platform products, adjacent products form comprehensive platform solutions to meet customer needs.
PC-CENTRIC BUSINESSOur CCG business, including both platform and adjacent products.
DATA-CENTRIC BUSINESSESOur DCG, Internet of Things (IOTG and Mobileye), NSG, PSG, and all other businesses.
Intel, the Intel logo, 3D XPoint, Intel Atom, Intel Core, Intel Optane, Thunderbolt,Stratix, and Xeon, 3D NAND and 3D XPoint are trademarks of Intel Corporation or its subsidiaries in the U.S. and/or other countries.
* Other names and brands may be claimed as the property of others.

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1
Table of Contents

OUR PANDEMIC RESPONSE
As we closely monitor the COVID-19 pandemic, our top priority remains protecting the health and safety of our employees. Our Pandemic Leadership Team regularly reviews and adapts our policies based on evolving research and guidance related to the virus. While essential operations continue in our factories and labs around the world, we have restricted travel and meetings, changed our business processes, published a wealth of information, and adapted to a world where many in our workforce are remote and those coming on-site are following new safety measures. We have a multi-phase plan to return to working on-site, and remain committed to delivering for our customers and supporting our communities.
Return to working on-site, at-work social distancing policies, and other safety measures. Since the start of the pandemic, employees who are essential to keeping our business running have continued to work on site in our labs and factories. The additional safety measures and practices we put in place during the first quarter of 2020 to protect these employees continue to be implemented subject to each location’s return on-site processes.
Our plan for returning the remainder of our workforce to work on-site involves multiple phases that gradually allow additional workers to return while practicing social distancing and other safety measures. This plan considers the varying needs of each location and site and depends on local government regulations, community case trends, and recommendations from public health organizations. In the second quarter of 2020, we implemented a telecommuting reimbursement program to help those employees who are still required to work from home improve their workspaces.
Maintaining safe facilities is core to how we operate. Based on the recommendations from national and international health authorities, and the results of recent scientific studies, we are now mandating the use of facemasks for all employees at all Intel sites during all phases of our return to on-site process, except in the final phase when facemasks are recommended rather than mandated.
Operations. With our factories continuing to operate world-wide, we are working with our customers to meet their specific shipment needs. Our world-class safety standards and supply chain operations have to date allowed our factories to continue to operate safely and with mostly on-time deliveries. We temporarily paused a few of our construction projects in the first quarter of 2020 due to local government restrictions at a small number of our sites. Construction resumed during the quarter across all projects. We do not expect the interruptions to impact either our ability to support customers or our process technology roadmap.
Supply chain. Our existing Business Continuity Program, combined with the additional actions taken throughout the pandemic to address our supply chain, continue to support our operations as an essential business.
In the second quarter of 2020, we introduced a COVID-19 channel relief program to help address the unique business challenges our partners are facing. Benefits of this program include customer support and warranty timeline extensions, extending the expiration term for certain programs, financial assistance to our distribution partners, and providing no-cost design reviews and additional technical enablement benefits.
Using our technology to help. In April, we committed $50 million towards a Pandemic Response Technology Initiative. Since that announcement, we have worked with over 100 organizations on close to 200 projects aimed at helping to cope with and combat this global pandemic. We have put more than $30 million of this pledge to work on projects spanning healthcare, education, industrial, retail, transportation, academia, and more.
We will continue to actively monitor the situation and review our plans based on the requirements and recommendations of the federal, state, and local authorities.
intc-20200627_g3.jpgOUR PANDEMIC RESPONSE
12
Table of Contents


A QUARTER IN REVIEW
Total revenue of $16.5$19.7 billion declinedwas up $3.2 billion year over year as our data-centric businesses were downand PC-centric business grew 34% and 7%; this was partially offset by 1% growth in our PC-centric business., respectively. Data-centric revenue was down compared to a year ago as cloud customers absorbed capacity, data center total addressableup, driven by growth across all DCG business market (TAM) for the quarter contracted in the enterprisesegments, strong mix of high-performance Intel® Xeon® processors, NSG bit growth, and government market segment, China demand weakened, andimproved NAND pricing remained under pressure.pricing. Our PC-centric business was up, driven by average selling price (ASP) strength with richer commercial segment mixin notebook platform1 demand, strong platform ASP, higher modem and modem growth. PC client volume declined on small core supply constraintWi-Fi sales, partially offset by sales pull-ins by customers in anticipation of tariff impacts. Lowerdesktop demand. Increased platform unit sales, ASP strength, and further margin compression on memory productsNSG growth resulted in lowerhigher gross margins dollars and operating income, which was partially offset by executing the quarter with continued operating margin leverage.higher platform unit cost and platform reserves. In the first six months we generated $12.5$17.3 billion of cash flow from operations and returned $8.4$7.0 billion to stockholders, including $2.8$2.8 billion in dividends and $5.6$4.2 billion in Q1 2020 buybacks.
REVENUEOPERATING INCOMEDILUTED EPSCASH FLOWS
■ PC-CENTRIC $B
■ DATA-CENTRIC $B
■ GAAP $B ■ NON-GAAP $B
■ GAAP ■ NON-GAAP
c01qirrevenue.jpgc02qiropincome.jpgc03qireps.jpg
     
$16.5B   $4.6B $5.1B $0.92 $1.06
GAAP   GAAP 
non-GAAP1
 GAAP 
non-GAAP1
down $457M or 3% from Q2 2018 down $656M or 12% from Q2 2018 down $460M or 8% from Q2 2018 down $0.13 or 12% from Q2 2018 up $0.02 or 2% from Q2 2018
         
Declines in data-centric businesses generally, partially offset by growth in PC-centric business and Internet of Things Lower gross margin from decrease in platform unit sales and NAND pricing degradation, partially offset by CPU ASP strength Impact from lower platform volume, and NAND pricing pressure, partially offset by the receipt of McAfee, Inc. dividend, as well as lower shares outstanding
BUSINESS SUMMARY
•
We have maintained an intense, company-wide focus on improving execution while accelerating innovation. We began shipping our 10 nanometer (nm)-based 10th generation Intel®■ Core™ processors, code-named Ice Lake. These processors feature a new core architecture and are expected to deliver increased graphics performance and artificial intelligence and new levels of integrated connectivity for thin-and-light laptops and 2-in-1s. We also shared more details about our Project Athena platform innovation program to help the PC ecosystem create advanced laptops that meet ambitious key experience indicators in performance, responsiveness, battery life, form factor, and artificial intelligence.OPERATING CASH FLOW$B
■FREE CASH FLOW $B
At our 2019 Investor Meeting, we shared details on our 7nm process technology and the expected performance gains resulting from a combination of technical innovations across six pillars — process and packaging, architecture, memory, interconnect, security, and software — giving insight into the design and engineering model steering our product development.
DCG experienced challenges as cloud customers absorbed capacity and the enterprise and government TAM declined. NSG declined as industry-wide pricing pressure for NAND intensified. However, demand for edge compute drove double digit revenue growth for Mobileye and IOTG.intc-20200627_g4.jpgintc-20200627_g5.jpgintc-20200627_g6.jpgintc-20200627_g7.jpg
PC-centric growth was driven by strength in our commercial market segment, as well as adjacencies led by modem. Platform volumes declined in the first half of 2019 compared to first half of 2018 as we experienced small core supply constraints. We continued to invest in capacity expansion for 14nm production, improving our supply in the second half of 2019.
In July, we signed an agreement to divest the majority of our smartphone modem business, including certain employees, intellectual property, equipment and leases. The transaction enables us to increase the focus of our 5G efforts on the broader opportunity to modernize network and edge infrastructure, and is expected to close in the fourth quarter of 2019. We also acquired Barefoot Networks, an emerging leader in Ethernet switch silicon and software for use in data center.
$19.7B$5.7B$6.1B$1.19$1.23$17.3B$10.6B
GAAPGAAP
non-GAAP2
GAAP
non-GAAP2
GAAP
non-GAAP2
Revenue up $3.2B or 20% from Q2 2019Operating income up $1.1B or 23% from Q2 2019; Q2 2020 operating margin at 29%Operating income up $0.9B or 18% from Q2 2019; Q2 2020 operating margin at 31%Diluted EPS up $0.27 or 29% from Q2 2019Diluted EPS up $0.17 or 16% from Q2 2019Operating cash flow up $4.8B or 38% from Q2 2019Free cash flow up $5B or 88% from Q2 2019
Growth in data-centric businesses primarily driven by DCG and NSG and growth in the PC-centric businessHigher gross margin dollars from increase in platform unit sales and platform ASP strength, NAND market recovery and bit growth, partially offset by increase in platform unit cost and higher platform reserves
Higher platform volume, platform ASP strength, NAND market recovery and bit growth, adjacency1 strength, lower period charges, and lower shares outstanding, partially offset by higher platform unit cost, and higher platform reserves
Higher net income and working capital changes driven by inventory and income taxes, offset by other assets and liabilities











1 See "Key Terms" within Consolidated Condensed Financial Statements and Supplemental Details.
2 See "Non-GAAP Financial Measures" within Other Key Information.MD&A.


intc-20200627_g8.jpgA QUARTER IN REVIEW
23
Table of Contents

BUSINESS SUMMARY
•We experienced growth in most of our data-centric businesses, driven by strong demand across all DCG segments, and strength in 5G adjacencies and NAND. We introduced the 3rd Gen Intel® Xeon® Scalable processors and additions to our hardware and software AI portfolio.
•Growth in our PC-centric business was driven by strength in notebook demand, strong platform ASP, and continued strength in modem, partially offset by desktop demand. We announced the new 10th Gen Intel® Core™ vPro® processors for enterprise needs to deliver increased productivity improvements, connectivity, security features, and remote manageability. We also launched the Intel® Core™ processors with Intel® Hybrid Technology, leveraging Intel's Foveros 3D packaging technology.
•We acquired Moovit for $915 million to accelerate Mobileye's MaaS offering. Moovit is known for its urban mobility application and brings Mobileye closer to achieving our plan to become a complete mobility provider, including robotaxi services.
•We continue to accelerate our transition to 10nm-based products. We now expect to increase our 10nm-based product shipments for the year by more than 20 percent versus our January expectations. We expect production shipments of our next-generation 10nm client CPU product "Tiger Lake" in Q3 and are targeting initial production shipments of our first 10nm-based Xeon Scalable product, “Ice Lake,” for the end of the year. Our 10nm-based products are positioned for 2021, led by our third-generation client product “Alder Lake” and our second-generation server product “Sapphire Rapids.” Both products are expected to start initial production shipments in the second half of 2021.
•We now expect an approximate six-month delay in our 7nm-based CPU product timing relative to prior expectations. The primary driver is the yield of our 7nm manufacturing process, which based on recent data, is now trending approximately twelve months behind our internal target. We will continue to invest in our future process technology roadmap, but we will be pragmatic and objective in seeking to deploy the process technology that delivers the most predictability and performance for our customers, whether that be our process, external foundry process or a combination of both. Our advanced packaging technologies combined with our disaggregated architecture give us the flexibility to use the process technology that best serves our customers. As an example, we now expect that our data center discrete GPU design, “Ponte Vecchio", which was described in our 2019 Form 10-K, will be released in late 2021 or early 2022 utilizing external and internal process technologies combined with our advanced packaging technologies.
•We now expect to see initial production shipments of our first Intel-based 7nm product, a client CPU, in late 2022 or early 2023. We are also focused on maintaining an annual cadence of significant product improvements independent of our process roadmap, including for holiday 2022. In addition, we expect to see initial production shipments of our first Intel-based 7nm data center CPU design in the first half of 2023.


CONSOLIDATED CONDENSED STATEMENTS OF INCOME
  Three Months Ended Six Months Ended
(In Millions, Except Per Share Amounts; Unaudited) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Net revenue $16,505
 $16,962
 $32,566
 $33,028
Cost of sales 6,627
 6,543
 13,599
 12,878
Gross margin 9,878
 10,419
 18,967
 20,150
Research and development 3,438
 3,371
 6,770
 6,682
Marketing, general and administrative 1,589
 1,725
 3,122
 3,625
Restructuring and other charges 184
 —
 184
 —
Amortization of acquisition-related intangibles 50
 50
 100
 100
Operating expenses 5,261
 5,146
 10,176
 10,407
Operating income 4,617
 5,273
 8,791
 9,743
Gains (losses) on equity investments, net 170
 (203) 604
 440
Interest and other, net (63) 459
 (124) 357
Income before taxes 4,724
 5,529
 9,271
 10,540
Provision for taxes 545
 523
 1,118
 1,080
Net income $4,179
 $5,006
 $8,153
 $9,460
Earnings per share – basic $0.94
 $1.08
 $1.82
 $2.03
Earnings per share – diluted $0.92
 $1.05
 $1.79
 $1.98
Weighted average shares of common stock outstanding:        
Basic 4,466
 4,649
 4,479
 4,661
Diluted 4,523
 4,747
 4,543
 4,768
See accompanying notes.

intc-20200627_g8.jpg  FINANCIAL STATEMENTSA QUARTER IN REVIEW
  Consolidated Condensed Statements of Income34



CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
  Three Months Ended Six Months Ended
(In Millions; Unaudited) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Net income $4,179
 $5,006
 $8,153
 $9,460
Changes in other comprehensive income, net of tax:        
Net unrealized holding gains (losses) on derivatives 151
 (293) 253
 (174)
Actuarial valuation and other pension benefits (expenses), net 8
 (122) 17
 26
Translation adjustments and other 32
 9
 82
 (13)
Other comprehensive income (loss) 191
 (406) 352
 (161)
Total comprehensive income $4,370
 $4,600
 $8,505
 $9,299
 Three Months EndedSix Months Ended
(In Millions, Except Per Share Amounts; Unaudited)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Net revenue$19,728  $16,505  $39,556  $32,566  
Cost of sales9,221  6,627  17,033  13,599  
Gross margin10,507  9,878  22,523  18,967  
Research and development3,354  3,438  6,629  6,770  
Marketing, general and administrative1,447  1,639  2,988  3,222  
Restructuring and other charges9  184  171  184  
Operating expenses4,810  5,261  9,788  10,176  
Operating income5,697  4,617  12,735  8,791  
Gains (losses) on equity investments, net267  170  156  604  
Interest and other, net(29) (63) (342) (124) 
Income before taxes5,935  4,724  12,549  9,271  
Provision for taxes830  545  1,783  1,118  
Net income$5,105  $4,179  $10,766  $8,153  
Earnings per share—basic$1.20  $0.94  $2.53  $1.82  
Earnings per share—diluted$1.19  $0.92  $2.50  $1.79  
Weighted average shares of common stock outstanding:
Basic4,246  4,466  4,256  4,479  
Diluted4,284  4,523  4,298  4,543  
See accompanying notes.

intc-20200627_g10.jpgFINANCIAL STATEMENTS
  Consolidated Condensed Statements of Income5
Table of Contents

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
Three Months EndedSix Months Ended
(In Millions; Unaudited)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Net income$5,105  $4,179  $10,766  $8,153  
Changes in other comprehensive income, net of tax:
Net unrealized holding gains (losses) on derivatives319  151  51  253  
Actuarial valuation and other pension benefits (expenses), net11  8  23  17  
Translation adjustments and other59  32  54  82  
Other comprehensive income (loss)389  191  128  352  
Total comprehensive income$5,494  $4,370  $10,894  $8,505  
See accompanying notes.
intc-20200627_g11.jpgFINANCIAL STATEMENTS
  Consolidated Condensed Statements of Comprehensive Income46

Table of Contents


CONSOLIDATED CONDENSED BALANCE SHEETS
(In Millions) Jun 29,
2019		 Dec 29,
2018		(In Millions)Jun 27, 2020Dec 28, 2019
 (unaudited)  (unaudited)
Assets    Assets
Current assets:    Current assets:
Cash and cash equivalents $2,867
 $3,019
Cash and cash equivalents$8,736  $4,194  
Short-term investments 2,414
 2,788
Short-term investments4,791  1,082  
Trading assets 6,663
 5,843
Trading assets12,288  7,847  
Accounts receivable 6,233
 6,722
Accounts receivable7,441  7,659  
Inventories 8,696
 7,253
Inventories8,969  8,744  
Other current assets 2,366
 3,162
Other current assets2,165  1,713  
Total current assets 29,239
 28,787
Total current assets44,390  31,239  
Property, plant and equipment, net of accumulated depreciation of $69,227 ($65,342 as of December 29, 2018) 51,377
 48,976
Property, plant and equipment, net of accumulated depreciation of $77,988 ($73,321 as of December 28, 2019)Property, plant and equipment, net of accumulated depreciation of $77,988 ($73,321 as of December 28, 2019)58,036  55,386  
Equity investments 4,629
 6,042
Equity investments3,901  3,967  
Other long-term investments 3,577
 3,388
Other long-term investments2,884  3,276  
Goodwill 24,583
 24,513
Goodwill26,943  26,276  
Identified intangible assets, net 11,249
 11,836
Identified intangible assets, net10,303  10,827  
Other long-term assets 6,105
 4,421
Other long-term assets6,082  5,553  
Total assets $130,759
 $127,963
Total assets$152,539  $136,524  
    
Liabilities, temporary equity, and stockholders’ equity    Liabilities, temporary equity, and stockholders’ equity
Current liabilities:    Current liabilities:
Short-term debt $3,726
 $1,261
Short-term debt$2,254  $3,693  
Accounts payable 4,682
 3,824
Accounts payable5,045  4,128  
Accrued compensation and benefits 2,554
 3,622
Accrued compensation and benefits2,833  3,853  
Other accrued liabilities 8,743
 7,919
Other accrued liabilities12,349  10,636  
Total current liabilities
19,705
 16,626
Total current liabilities22,481  22,310  
Debt 25,089
 25,098
Debt36,093  25,308  
Contract liabilities 1,558
 2,049
Contract liabilities1,329  1,368  
Income taxes payable, non-current 4,847
 4,897
Income taxes payable, non-current4,795  4,919  
Deferred income taxes 1,783
 1,665
Deferred income taxes2,723  2,044  
Other long-term liabilities 2,583
 2,646
Other long-term liabilities3,108  2,916  
Contingencies (Note 12) 

 

Contingencies (Note 13)Contingencies (Note 13)
Temporary equity 247
 419
Temporary equity—  155  
Stockholders’ equity:    Stockholders’ equity:
Preferred stock —
 —
Preferred stock—  —  
Common stock and capital in excess of par value, 4,430 issued and outstanding (4,516 issued and outstanding as of December 29, 2018) 25,140
 25,365
Common stock and capital in excess of par value, 4,253 issued and outstanding (4,290 issued and outstanding as of December 28, 2019)Common stock and capital in excess of par value, 4,253 issued and outstanding (4,290 issued and outstanding as of December 28, 2019)25,516  25,261  
Accumulated other comprehensive income (loss) (622) (974)Accumulated other comprehensive income (loss)(1,152) (1,280) 
Retained earnings 50,429
 50,172
Retained earnings57,646  53,523  
Total stockholders’ equity 74,947
 74,563
Total stockholders’ equity82,010  77,504  
Total liabilities, temporary equity, and stockholders’ equity $130,759
 $127,963
Total liabilities, temporary equity, and stockholders’ equity$152,539  $136,524  
See accompanying notes.

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  Consolidated Condensed Balance Sheets57

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CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
 Six Months Ended Six Months Ended
(In Millions; Unaudited) Jun 29,
2019		 Jun 30,
2018		(In Millions; Unaudited)Jun 27, 2020Jun 29, 2019
Cash and cash equivalents, beginning of period $3,019
 $3,433
Cash and cash equivalents, beginning of period$4,194  $3,019  
Cash flows provided by (used for) operating activities:    Cash flows provided by (used for) operating activities:
Net income 8,153
 9,460
Net income10,766  8,153  
Adjustments to reconcile net income to net cash provided by operating activities:    Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 4,379
 3,536
Depreciation5,248  4,379  
Share-based compensation 859
 820
Share-based compensation941  859  
Amortization of intangibles 800
 782
Amortization of intangibles865  800  
(Gains) losses on equity investments, net (100) (401)(Gains) losses on equity investments, net(92) (100) 
Changes in assets and liabilities:    Changes in assets and liabilities:
Accounts receivable 490
 369
Accounts receivable224  490  
Inventories (1,443) (303)Inventories(271) (1,443) 
Accounts payable 431
 274
Accounts payable208  431  
Accrued compensation and benefits (1,012) (884)Accrued compensation and benefits(919) (1,012) 
Customer deposits and prepaid supply agreements (444) 1,580
Prepaid supply agreementsPrepaid supply agreements(161) (444) 
Income taxes (15) (1,133)Income taxes1,203  (15) 
Other assets and liabilities 448
 (403)Other assets and liabilities(697) 448  
Total adjustments 4,393
 4,237
Total adjustments6,549  4,393  
Net cash provided by operating activities 12,546
 13,697
Net cash provided by operating activities17,315  12,546  
Cash flows provided by (used for) investing activities:    Cash flows provided by (used for) investing activities:
Additions to property, plant and equipment (6,875) (7,440)Additions to property, plant and equipment(6,676) (6,875) 
Purchases of available-for-sale debt investments (1,721) (1,578)Purchases of available-for-sale debt investments(4,558) (1,721) 
Maturities of available-for-sale debt investments 1,903
 1,720
Maturities and sales of available-for-sale debt investmentsMaturities and sales of available-for-sale debt investments1,303  2,031  
Purchases of trading assets (4,498) (6,501)Purchases of trading assets(11,429) (4,498) 
Maturities and sales of trading assets 3,808
 7,691
Maturities and sales of trading assets7,430  3,808  
Sales of equity investments 1,331
 215
Sales of equity investments186  1,331  
Other investing 42
 (91)Other investing(602) (86) 
Net cash used for investing activities (6,010) (5,984)Net cash used for investing activities(14,346) (6,010) 
Cash flows provided by (used for) financing activities:    Cash flows provided by (used for) financing activities:
Increase (decrease) in short-term debt, net 996
 1,991
Increase (decrease) in short-term debt, net—  996  
Issuance of long-term debt, net of issuance costs 601
 —
Issuance of long-term debt, net of issuance costs10,247  601  
Repayment of debt and debt conversion (1,033) (1,169)Repayment of debt and debt conversion(2,775) (1,033) 
Proceeds from sales of common stock through employee equity incentive plans 305
 320
Proceeds from sales of common stock through employee equity incentive plans512  305  
Repurchase of common stock (5,579) (5,807)Repurchase of common stock(4,229) (5,579) 
Payment of dividends to stockholders (2,828) (2,800)Payment of dividends to stockholders(2,811) (2,828) 
Other financing 850
 (1,067)Other financing629  850  
Net cash provided by (used for) financing activities (6,688) (8,532)Net cash provided by (used for) financing activities1,573  (6,688) 
Net increase (decrease) in cash and cash equivalents (152) (819)Net increase (decrease) in cash and cash equivalents4,542  (152) 
Cash and cash equivalents, end of period $2,867
 $2,614
Cash and cash equivalents, end of period$8,736  $2,867  
    
Supplemental disclosures of noncash investing activities and cash flow information:    Supplemental disclosures of noncash investing activities and cash flow information:
Acquisition of property, plant, and equipment included in accounts payable and accrued liabilities $2,678
 $2,789
Acquisition of property, plant, and equipment included in accounts payable and accrued liabilities$2,836  $2,678  
Cash paid during the period for:    Cash paid during the period for:
Interest, net of capitalized interest $243
 $209
Interest, net of capitalized interest$252  $243  
Income taxes, net of refunds $1,112
 $2,196
Income taxes, net of refunds$574  $1,112  
See accompanying notes.

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CONSOLIDATED CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY
Common Stock and Capital in Excess of Par ValueAccumulated Other Comprehensive Income (Loss)Retained EarningsTotal
(In Millions, Except Per Share Amounts; Unaudited)SharesAmount
Three Months Ended
Balance as of March 28, 20204,234  $25,251  $(1,541) $52,644  $76,354  
Net income—  —  —  5,105  5,105  
Other comprehensive income (loss)—  —  389  —  389  
Employee equity incentive plans and other25  9  —  —  9  
Share-based compensation—  492  —  —  492  
Temporary equity reduction—  —  —  —  —  
Convertible debt—  —  —  —   —  
Repurchase of common stock—  —  —  —  —  
Restricted stock unit withholdings(6) (236) —  (103) (339) 
Balance as of June 27, 20204,253  $25,516  $(1,152) $57,646  $82,010  
Balance as of March 30, 20194,477  $25,346  $(813) $49,128  $73,661  
Net income—  —  —  4,179  4,179  
Other comprehensive income (loss)—  —  191  —  191  
Employee equity incentive plans and other27  31  —  —  31  
Share-based compensation—  471  —  —  471  
Temporary equity reduction—  28  —  —  28  
Convertible debt—  (120) —  —  (120) 
Repurchase of common stock(67) (381) —  (2,764) (3,145) 
Restricted stock unit withholdings(7) (235) —  (114) (349) 
Balance as of June 29, 20194,430  $25,140  $(622) $50,429  $74,947  
Six Months Ended
Balance as of December 28, 20194,290  $25,261  $(1,280) $53,523  $77,504  
Net income—  —  —  10,766  10,766  
Other comprehensive income (loss)—  —  128  —  128  
Employee equity incentive plans and other42  629  —  —  629  
Share-based compensation—  941  —  —  941  
Temporary equity reduction—  155  —  —  155  
Convertible debt—  (750) —  —  (750) 
Repurchase of common stock(71) (420) —  (3,689) (4,109) 
Restricted stock unit withholdings(8) (300) —  (135) (435) 
Cash dividends declared ($0.66 per share)—  —  —  (2,819) (2,819) 
Balance as of June 27, 20204,253  $25,516  $(1,152) $57,646  $82,010  
Balance as of December 29, 20184,516  $25,365  $(974) $50,172  $74,563  
Net income—  —  —  8,153  8,153  
Other comprehensive income (loss)—  —  352  —  352  
Employee equity incentive plans and other¹38  403  —  —  403  
Share-based compensation—  860  —  —  860  
Temporary equity reduction—  173  —  —  173  
Convertible debt—  (712) —  —  (712) 
Repurchase of common stock(116) (659) —  (4,936) (5,595) 
Restricted stock unit withholdings(8) (290) —  (131) (421) 
Cash dividends declared ($0.63 per share)—  —  —  (2,829) (2,829) 
Balance as of June 29, 20194,430  $25,140  $(622) $50,429  $74,947  
  Common Stock and Capital in Excess of Par Value Accumulated Other Comprehensive Income (Loss) Retained Earnings Total
(In Millions, Except Per Share Amounts) Shares Amount   
Three Months Ended          
           
Balance as of March 30, 2019 4,477
 $25,346
 $(813) $49,128
 $73,661
Net income —
 —
 —
 4,179
 4,179
Other comprehensive income (loss) —
 —
 191
 —
 191
Employee equity incentive plans and other 28
 31
 —
 —
 31
Share-based compensation —
 471
 —
 —
 471
Temporary equity reduction —
 28
 —
 —
 28
Convertible debt —
 (120) —
 —
 (120)
Repurchase of common stock (67) (381) —
 (2,764) (3,145)
Restricted stock unit withholdings (7) (235) —
 (114) (349)
Balance as of June 29, 2019 4,430
 $25,140
 $(622) $50,429
 $74,947
           
Balance as of March 31, 2018 4,660
 $26,430
 $(683) $44,418
 $70,165
Net income —
 —
 —
 5,006
 5,006
Other comprehensive income (loss) —
 —
 (406) —
 (406)
Employee equity incentive plans and other¹ 31
 110
 —
 —
 110
Share-based compensation —
 372
 —
 —
 372
Temporary equity reduction —
 147
 —
 —
 147
Convertible debt —
 (563) —
 —
 (563)
Non-controlling interest —
 (375) —
 —
 (375)
Repurchase of common stock (76) (424) —
 (3,589) (4,013)
Restricted stock unit withholdings (8) (227) —
 (169) (396)
Balance as of June 30, 2018 4,607
 $25,470
 $(1,089) $45,666
 $70,047
           
Six Months Ended          
           
Balance as of December 29, 2018 4,516
 $25,365
 $(974) $50,172
 $74,563
Net income —
 —
 —
 8,153
 8,153
Other comprehensive income (loss) —
 —
 352
 —
 352
Employee equity incentive plans and other 39
 403
 —
 —
 403
Share-based compensation —
 860
 —
 —
 860
Temporary equity reduction —
 173
 —
 —
 173
Convertible debt —
 (712) —
 —
 (712)
Repurchase of common stock (117) (659) —
 (4,936) (5,595)
Restricted stock unit withholdings (8) (290) —
 (131) (421)
Cash dividends declared ($0.63 per share) —
 —
 —
 (2,829) (2,829)
Balance as of June 29, 2019 4,430
 $25,140
 $(622) $50,429
 $74,947
           
Balance as of December 30, 2017 4,687
 $26,074
 $862
 $42,083
 $69,019
Adjustment for change in accounting principle —
 —
 (1,790) 2,424
 634
Opening balance as of December 31, 2017 4,687
 26,074
 (928) 44,507
 69,653
Net income —
 —
 —
 9,460
 9,460
Other comprehensive income (loss) —
 —
 (161) —
 (161)
Employee equity incentive plans and other¹ 46
 433
 —
 —
 433
Share-based compensation —
 825
 —
 —
 825
Temporary equity reduction —
 212
 —
 —
 212
Convertible debt —
 (770) —
 —
 (770)
Non-controlling interest —
 (375) —
 —
 (375)
Repurchase of common stock (117) (649) —
 (5,319) (5,968)
Restricted stock unit withholdings (9) (280) —
 (181) (461)
Cash dividends declared ($0.60 per share) —
 —
 —
 (2,801) (2,801)
Balance as of June 30, 2018 4,607
 $25,470
 $(1,089) $45,666
 $70,047
1
Includes approximately $375 million of non-controlling interest activity due to our acquisition of Mobileye in 2017, which was eliminated in 2018 due to the purchase of remaining shares.
See accompanying notes.

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NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
NOTE 1 :BASIS OF PRESENTATION
We prepared our interim consolidated condensed financial statementsConsolidated Condensed Financial Statements that accompany these notes in conformity with U.S. GAAP, consistent in all material respects with those applied in our Annual Report on2019 Form 10-K for the fiscal year ended December 29, 2018 (2018 Form 10-K), except for changes associated with leases as detailed in "Note 2: Recent Accounting Standards and Accounting Policies." We have reclassified certain prior period amounts to conform to current period presentation.10-K.
We have made estimates and judgments affecting the amounts reported in our consolidated condensed financial statementsConsolidated Condensed Financial Statements and the accompanying notes. The inputs into our judgments and estimates consider the economic implications of COVID-19 on our critical and significant accounting estimates. The actual results that we experience may differ materially from our estimates. The interim financial information is unaudited, and reflects all normal adjustments that are, in our opinion, necessary to provide a fair statement of results for the interim periods presented. This report should be read in conjunction with the consolidated financial statementsConsolidated Financial Statements in our 20182019 Form 10-K.
NOTE 2 :RECENT ACCOUNTING STANDARDS AND ACCOUNTING POLICIES

We assess the adoption impacts of recently issued accounting standards by the Financial Accounting Standards Board on10-K where we include additional information about our financial statements and below describe impacts from newly adopted standards, as well as material updates to our previous assessments, if any, from our 2018 Form 10-K.
ACCOUNTING STANDARDS ADOPTED
Leases
Standard/Description: This new lease accounting standard requires that we recognize leased assets and corresponding liabilities on the balance sheet and provide enhanced disclosure of lease activity.
Effective Date and Adoption Considerations: Effective in the first quarter of 2019. The standard was adopted applying the modified retrospective approach at the beginning of the period of adoption. Our leased assets and corresponding liabilities exclude non-lease components.
Effect on Financial Statements or Other Significant Matters: Within the opening balances for the fiscal year beginning December 30, 2018, we recognized leased assets and corresponding liabilities in other long-term assets of $706 million, which includes $81 million of previously recognized prepaid land use rights, as well as corresponding accrued liabilities of $180 million and other long-term liabilities of $445 million.
Accounting Policy Updates and Disclosures: We determine if an arrangement is a lease at inception, and classify it as finance or operating. Leased assets and corresponding liabilities are recognized based on the present value of the lease payments over the lease term. Our lease terms may include options to extend when it is reasonably certain that we will exercise that option. We have lease agreements with lease and non-lease components,policies and the non-lease components are accounted for separatelymethods and not includedassumptions used in our leased assets and corresponding liabilities. Leases primarily consist of real property, and, to a lesser extent, certain machinery and equipment.estimates.
We recognized leased assets in other long-term assets of $684 million and corresponding accrued liabilities of $178 million, and other long-term liabilities of $426 million as of June 29, 2019. Our leases have remaining lease terms of 1 to 9 years, some of which may include options to extend the leases for up to 39 years. The weighted average remaining lease term was 5.0 years, and the weighted average discount rate was 3.6% as of June 29, 2019.
For the six months ended June 29, 2019, lease expense was $94 million. In accordance with the new leases standard, discounted and undiscounted lease payments under non-cancelable leases as of June 29, 2019, excluding non-lease components, are as follows:
(In Millions) Remainder of 2019 2020 2021 2022 2023 2024 and Thereafter Total
Lease payments $93
 $173
 $122
 $96
 $70
 $107
 $661
Present value of lease payments             $604

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  Notes to Financial Statements8


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Lease expense was $231 million in 2018 ($264 million in 2017). Prior to our adoption of the new leases standard, future minimum lease payments as of December 29, 2018, which were undiscounted and included lease and non-lease components, were as follows:
(In Millions) 2019 2020 2021 2022 2023 2024 and Thereafter Total
Minimum rental commitments under all non-cancelable leases $229
 $181
 $133
 $101
 $70
 $121
 $835

NOTE 32 :OPERATING SEGMENTS

We manage our business through the following operating segments:
Client Computing Group (CCG)•DCG
Data Center Group (DCG)•IOTG
Internet of Things Group (IOTG)•Mobileye
Mobileye•NSG
Non-Volatile Memory Solutions Group (NSG)•PSG
Programmable Solutions Group (PSG)•CCG
All Other
We offer platform products that incorporate various components and technologies, including a microprocessor and chipset, a stand-alone SoC, or a multichip package. A platform product may be enhanced by additional hardware, software, and services offered by Intel. Platform products are used in various form factors across our CCG, DCG, and IOTG operating segments. We derive a substantial majority of our revenue from platform products, which are our principal products and considered as one class of product. We offer platform products that incorporate various components and technologies, including a microprocessor and chipset, a stand-alone SoC, or a multichip package. Platform products are used in various form factors across our DCG, IOTG, and CCG operating segments. Our non-platform, or adjacent products, can be combined with platform products to form comprehensive platform solutions to meet customer needs.
CCGDCG and DCGCCG are our reportable operating segments. IOTG, Mobileye, NSG, and PSG do not meet the quantitative thresholds to qualify as reportable operating segments; however, we have elected to disclose the results of these non-reportable operating segments. Our Internet of Things portfolio, presented as Internet of Things, is comprised of IOTG and Mobileye operating segments.
TheWe have an “all other” category that includes revenue, expenses, and charges such as:
•results of operations from non-reportable segments not otherwise presented;
•
•historical results of operations from divested businesses;
•results of operations of start-up businesses that support our initiatives, including our foundry business;
•amounts included within restructuring and other charges;
•a portion of employee benefits, compensation, and other expenses not allocated to the operating segments; and
•
•
results of operations of start-up businesses that support our initiatives, including our foundry business;
•
amounts included within restructuring and other charges;
•
a portion of employee benefits, compensation, and other expenses not allocated to the operating segments; and
acquisition-related costs, including amortization and any impairment of acquisition-related intangibles and goodwill.
The Chief Operating Decision Maker (CODM), whichCODM, who is our Chief Executive Officer (CEO),CEO, does not evaluate operating segments using discrete asset information. Operating segments do not record inter-segment revenue. We do not allocate gains and losses from equity investments, interest and other income, or taxes to operating segments. Although the CODM uses operating income to evaluate the segments, operating costs included in one segment may benefit other segments. Except for these differences, theThe accounting policies for segment reporting are the same as for Intel as a whole.










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Net revenue and operating income (loss) for each period were as follows:
Three Months EndedSix Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Net revenue:
Data Center Group
Platform$6,181  $4,553  $12,608  $9,035  
Adjacent936  430  1,502  850  
7,117  4,983  14,110  9,885  
Internet of Things
IOTG670  986  1,553  1,896  
Mobileye146  201  400  410  
816  1,187  1,953  2,306  
Non-Volatile Memory Solutions Group1,659  940  2,997  1,855  
Programmable Solutions Group501  489  1,020  975  
Client Computing Group
Platform8,229  7,925  16,941  15,749  
Adjacent1,267  916  2,330  1,678  
9,496  8,841  19,271  17,427  
All other139  65  205  118  
Total net revenue$19,728  $16,505  $39,556  $32,566  
Operating income (loss):
Data Center Group$3,099  $1,800  6,591  $3,641  
Internet of Things
IOTG70  294  313  545  
Mobileye(4) 53  84  121  
66  347  397  666  
Non-Volatile Memory Solutions Group322  (284) 256  (581) 
Programmable Solutions Group80  52  177  141  
Client Computing Group2,842  3,737  7,067  6,809  
All other(712) (1,035) (1,753) (1,885) 
Total operating income$5,697  $4,617  $12,735  $8,791  
  Three Months Ended Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Net revenue:        
Client Computing Group        
Platform $7,925
 $8,065
 $15,749
 $15,680
Adjacent 916
 663
 1,678
 1,268
  8,841
 8,728
 17,427
 16,948
Data Center Group        
Platform 4,553
 5,100
 9,035
 9,924
Adjacent 430
 449
 850
 859
  4,983
 5,549
 9,885
 10,783
Internet of Things        
IOTG 986
 880
 1,896
 1,720
Mobileye 201
 173
 410
 324
  1,187
 1,053
 2,306
 2,044
         
Non-Volatile Memory Solutions Group 940
 1,079
 1,855
 2,119
Programmable Solutions Group 489
 517
 975
 1,015
All other 65
 36
 118
 119
Total net revenue $16,505
 $16,962
 $32,566
 $33,028
         
Operating income (loss):        
Client Computing Group $3,737
 $3,234
 $6,809
 $6,025
Data Center Group 1,800
 2,737
 3,641
 5,339
         
Internet of Things        
IOTG 294
 243
 545
 470
Mobileye 53
 44
 121
 54
  347
 287
 666
 524
         
Non-Volatile Memory Solutions Group (284) (65) (581) (146)
Programmable Solutions Group 52
 101
 141
 198
All other (1,035) (1,021) (1,885) (2,197)
Total operating income $4,617
 $5,273
 $8,791
 $9,743







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Disaggregated net revenue for each period was as follows:
Three Months EndedSix Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Platform revenue
DCG platform$6,181  $4,553  $12,608  $9,035  
IOTG platform619  891  1,414  1,716  
CCG desktop platform2,368  2,767  5,208  5,653  
CCG notebook platform5,844  5,136  11,701  10,063  
CCG other platform1
16  22  31  33  
15,028  13,369  30,962  26,500  
Adjacent revenue2
4,700  3,136  8,594  6,066  
Total revenue$19,728  $16,505  $39,556  $32,566  
  Three Months Ended Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Platform revenue        
Desktop platform $2,767
 $2,954
 $5,653
 $5,861
Notebook platform 5,136
 5,086
 10,063
 9,775
DCG platform 4,553
 5,100
 9,035
 9,924
IOTG platform 891
 745
 1,716
 1,464
Other platform1
 22
 25
 33
 44
  13,369
 13,910
 26,500
 27,068
         
Adjacent revenue2
 3,136
 3,052
 6,066
 5,960
Total revenue $16,505
 $16,962
 $32,566
 $33,028
1 
Includes our tablet and service provider revenue.
2 1
Includes our tablet and service provider revenue.
2
Includes all of our non-platform products for CCG, DCG, and IOTG such as modem, Ethernet, and silicon photonics, as well as Mobileye, NSG, and PSG products.
Planned divestiture of smartphone modem business
On July 25, 2019, we signed a definitive agreement to sell the majority of our smartphonenon-platform products for DCG, IOTG, and CCG such as modem, business. We will continue to meet current customer commitments for our existing 4G smartphone modem product line. We expect to close the transaction, which will include certain employees, intellectual property, equipmentEthernet, and leases, in the fourth quarter of 2019. We expect to record a gain on divestiture of approximately $500 million, net of tax.silicon photonics, as well as Mobileye, NSG, and PSG products.
NOTE 43 :EARNINGS PER SHARE

We computed basic earnings per share of common stock based on the weighted average number of shares of common stock outstanding during the period. We computed diluted earnings per share of common stock based on the weighted average number of shares of common stock outstanding plus potentially dilutive shares of common stock outstanding during the period.
  Three Months Ended Six Months Ended
(In Millions, Except Per Share Amounts) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Net income available to common stockholders $4,179
 $5,006
 $8,153
 $9,460
Weighted average shares of common stock outstanding – basic 4,466
 4,649
 4,479
 4,661
Dilutive effect of employee equity incentive plans 40
 52
 46
 59
Dilutive effect of convertible debt 17
 46
 18
 48
Weighted average shares of common stock outstanding – diluted 4,523
 4,747
 4,543
 4,768
Earnings per share – basic $0.94
 $1.08
 $1.82
 $2.03
Earnings per share – diluted $0.92
 $1.05
 $1.79
 $1.98
 Three Months EndedSix Months Ended
(In Millions, Except Per Share Amounts)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Net income available to common stockholders$5,105  $4,179  $10,766  $8,153  
Weighted average shares of common stock outstanding—basic4,246  4,466  4,256  4,479  
Dilutive effect of employee equity incentive plans38  40  42  46  
Dilutive effect of convertible debt—  17  —  18  
Weighted average shares of common stock outstanding—diluted4,284  4,523  4,298  4,543  
Earnings per share—basic
$1.20  $0.94  $2.53  $1.82  
Earnings per share—diluted
$1.19  $0.92  $2.50  $1.79  
Potentially dilutive shares of common stock from employee equity incentive plans are determined by applying the treasury stock method to the assumed exercise of outstanding stock options, the assumed vesting of outstanding restricted stock units (RSUs),RSUs, and the assumed issuance of common stock under the stock purchase plan. Our convertible debentures due 2039 (2009 debentures) require settlement
In January 2020, we fully redeemed the remaining principal of our 2009 Debentures. We included our 2009 Debentures in the principal amountcalculation of the debt in cash upon conversion. Since the conversion premium is paid in cash or stock at our option, we determined the potentially dilutive sharesdiluted earnings per share of common stock in 2019 by applying the treasury stock method.method because the average market price was above the conversion price.
In all periods presented, securitiesSecurities which would have been anti-dilutive are insignificant and are excluded from the computation of diluted earnings per share. Inshare in all periods presented, we included our 2009 debentures in the calculation of diluted earnings per share of common stock because the average market price was above the conversion price. We could potentially exclude the 2009 debentures in the future if the average market price is below the conversion price.

presented.







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NOTE 54 :CONTRACT LIABILITIES

(In Millions) Jun 29,
2019		 Dec 29,
2018
Prepaid supply agreements
 $2,143
 $2,587
Other 162
 122
Total contract liabilities $2,305
 $2,709

(In Millions)Jun 27, 2020Dec 28, 2019
Prepaid supply agreements$1,644  $1,805  
Other279  236  
Total contract liabilities$1,923  $2,041  
Contract liabilities are primarily related to partial prepayments received from customers on long-term prepaid supply agreements towardstoward future NSG product delivery. As new prepaid supply agreements are entered into and performance obligations are negotiated, this component of the contract liability balance will increase, and as customers purchase product and utilize their prepaid balances, the balance will decrease. The short-term portion of prepayments from supply agreementscontract liabilities is reported on the consolidated condensed balance sheetsConsolidated Condensed Balance Sheets within other accrued liabilities.
The following table shows the changes in contract liability balances relating to long-term prepaid supply agreements during the first six months of 2019:2020:
(In Millions)  
Prepaid supply agreements balance as of December 29, 2018 $2,587
Prepaids utilized (444)
Prepaid supply agreements balance as of June 29, 2019 $2,143

(In Millions)
Prepaid supply agreements balance as of December 28, 2019$1,805 
Prepayments utilized(161)
Prepaid supply agreements balance as of June 27, 2020$1,644 
During the second quarter of 2020, we issued a contract termination notification for breach to our largest prepaid supply customer with a $1.6 billion contract liability balance. The timing and amount of future anticipated revenue, or reversal of any contract liability balance, resulting from contract termination may vary due to ongoing customer negotiations.
NOTE 65 :OTHER FINANCIAL STATEMENT DETAILS

INVENTORIES
(In Millions) Jun 29,
2019		 Dec 29,
2018
Raw materials $808
 $813
Work in process 5,612
 4,511
Finished goods 2,276
 1,929
Total inventories $8,696
 $7,253

(In Millions)Jun 27, 2020Dec 28, 2019
Raw materials$903  $840  
Work in process6,093  6,225  
Finished goods1,973  1,679  
Total inventories$8,969  $8,744  
INTEREST AND OTHER, NET
The components of interest and other, net for each period were as follows:
  Three Months Ended Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Interest income $125
 $108
 $260
 $199
Interest expense (135) (116) (273) (228)
Other, net (53) 467
 (111) 386
Total interest and other, net $(63) $459
 $(124) $357

 Three Months EndedSix Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Interest income$83  $125  $176  $260  
Interest expense(186) (135) (321) (273) 
Other, net74  (53) (197) (111) 
Total interest and other, net$(29) $(63) $(342) $(124) 
Interest expense in the preceding table is net of $120$87 million of interest capitalized in the second quarter of 2020 and $170 million in the first six months of 2020 ($120 million in the second quarter of 2019 and $245 million in the first six months of 2019 ($126 million in the second quarter2019).







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  Notes to Financial Statements13
Table of 2018 and $239 million in the first six months of 2018). In the second quarter of 2018, we completed the divestiture of Wind River, and recognized a pre-tax gain of $494 million.Contents

NOTE 76 :RESTRUCTURING AND OTHER CHARGES
A restructuring program was approved in the first quarter of 2020 to further align our workforce with our continuing investments in the business and to execute the planned divestiture of Home Gateway Platform, a division of CCG. We expect these actions to be substantially complete in the third quarter of 2020.
A restructuring program was approved in the second quarter of 2019 to align our workforce with the plannedour exit of the smartphone modem business. We expect these actions to be substantially complete by endin the third quarter of 2019.


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2020.
Restructuring and other charges by type for the 2019 Restructuring Program for theeach period were as follows:
  Three Months Ended Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Employee severance and benefit arrangements $168
 $—
 $168
 $—
Asset impairment and other charges 16
 —
 16
 —
Total restructuring and other charges $184
 $—
 $184
 $—

Three Months EndedSix Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Employee severance and benefit arrangements$1  $168  $106  $168  
Asset impairment and other charges8  16  65  16  
Total restructuring and other charges$9  $184  $171  $184  
NOTE 87 :INVESTMENTS

DEBT INVESTMENTS
Trading Assets
Net gains related toFor trading assets still held at the reporting date were $99we recorded net gains of $347 million in the second quarter of 2020 and net gains of $183 million in the first six months of 2020 ($99 million of net gains in the second quarter of 2019 and $117 million of net gains in the first six months of 20192019). Net losses on the related derivatives were $251 million in the second quarter of 2020 and net losses of $204 million in the first six months of 2020 ($326102 million of net losses in the second quarter of 20182019 and $214$104 million of net losses in the first six months of 2018). Net losses on the related derivatives were $102 million in the second quarter of 2019 and $104 million in the first six months of 2019 (net gains of $316 million in the second quarter of 2018 and $221 million in the first six months of 2018)2019).
Available-for-Sale Debt Investments
  June 29, 2019 December 29, 2018
(In Millions) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value
Corporate debt $3,160
 $45
 $(4) $3,201
 $3,068
 $2
 $(28) $3,042
Financial institution
instruments		 3,034
 18
 (1) 3,051
 3,076
 3
 (11) 3,068
Government debt 903
 6
 —
 909
 1,069
 1
 (9) 1,061
Total available-for-sale debt investments $7,097
 $69
 $(5) $7,161
 $7,213
 $6
 $(48) $7,171

Jun 27, 2020Dec 28, 2019
(In Millions)Adjusted CostGross Unrealized GainsGross Unrealized LossesFair ValueAdjusted CostGross Unrealized GainsGross Unrealized LossesFair Value
Corporate debt$3,911  $94  $—  $4,005  $2,914  $44  $—  $2,958  
Financial institution
instruments		7,985  24  —  8,009  3,007  15  (1) 3,021  
Government debt2,491  12  —  2,503  560  4  —  564  
Total available-for-sale debt investments$14,387  $130  $—  $14,517  $6,481  $63  $(1) $6,543  
Government debt includes instruments such as non-U.S. government bonds and U.S. agency securities. Financial institution instruments include instruments issued or managed by financial institutions in various forms such as commercial paper, fixed and floating rate bonds, money market fund deposits, and time deposits. Substantially all time deposits were issued by institutions outside the U.S. as of June 29, 201927, 2020 and December 29, 2018.28, 2019.
The fair value of available-for-sale debt investments, by contractual maturity, as of June 29, 2019,27, 2020, was as follows:
(In Millions) Fair Value
Due in 1 year or less $3,174
Due in 1–2 years 733
Due in 2–5 years 2,722
Due after 5 years 122
Instruments not due at a single maturity date 410
Total $7,161
(In Millions)Fair Value
Due in 1 year or less$7,763 
Due in 1–2 years1,525 
Due in 2–5 years1,359 
Due after 5 years— 
Instruments not due at a single maturity date3,870 
Total$14,517 

EQUITY INVESTMENTS
(In Millions) Jun 29,
2019		 Dec 29,
2018
Marketable equity securities $197
 $1,440
Non-marketable equity securities 3,134
 2,978
Equity method investments 1,298
 1,624
Total $4,629

$6,042






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EQUITY INVESTMENTS
(In Millions)Jun 27, 2020Dec 28, 2019
Marketable equity securities$464  $450  
Non-marketable equity securities3,419  3,480  
Equity method investments18  37  
Total$3,901  

$3,967  

The components of gains (losses) on equity investments, net for each period were as follows:
  Three Months Ended Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Ongoing mark-to-market adjustments on marketable equity securities $(179) $(235) $74
 $371
Observable price adjustments on non-marketable equity securities 8
 24
 16
 148
Impairments (39) (26) (62) (43)
Sale of equity investments and other¹ 380
 34
 576
 (36)
Total gains (losses) on equity investments, net $170
 $(203) $604
 $440

 Three Months EndedSix Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Ongoing mark-to-market adjustments on marketable equity securities$165  $(179) $62  $74  
Observable price adjustments on non-marketable equity securities58  8  137  16  
Impairment charges(51) (39) (193) (62) 
Sale of equity investments and other¹95  380  150  576  
Total gains (losses) on equity investments, net$267  $170  $156  $604  
1 Sale of equity investments and other includes realized gains (losses) on sales of non-marketable equity investments, our share of equity method investee gains (losses) and distributions, and initial fair value adjustments recorded upon a security becoming marketable.
We recognized higher than historically experienced impairment charges on our non-marketable portfolio in the first six months of 2020 based on our assessment of the impact of recent public and private market volatility and tightening of liquidity.
Gains and losses for our marketable and non-marketable equity securities during the period were as follows:
  Three Months Ended Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Net gains (losses) recognized during the period on equity securities $(178) $(133) $84
 $592
Less: Net (gains) losses recognized during the period on equity securities sold during the period (33) (11) (258) (49)
Unrealized gains (losses) recognized during the reporting period on equity securities still held at the reporting date $(211) $(144) $(174) $543

IM Flash Technologies, LLC
Three Months EndedSix Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Net gains (losses) recognized during the period on equity securities$223  $(178) $83  $84  
Less: Net (gains) losses recognized during the period on equity securities sold during the period(55) (33) (58) (258) 
Unrealized gains (losses) recognized during the reporting period on equity securities still held at the reporting date$168  $(211) $25  $(174) 
IM Flash Technologies, LLC (IMFT)IMFT
IMFT was formed in 2006 by Micron Technology, Inc. (Micron) and Intel to jointly develop NAND flash memory and 3D XPoint™ technology products. IMFT is an unconsolidated variable interest entity and all costs of IMFT are passed on to Micron and Intel through sale of products or services in proportional share of ownership. As of June 29, 2019, we ownhad a carrying value of $1.3 billion in IMFT and owned a 49% interest in IMFT. Our portion of IMFT costs was approximately $224 million in the second quarter of 2019 and approximately $356 million in the first six months of 2019 (approximately $144 million in the second quarter of 2018 and $227 million in the first six months of 2018).
IMFT depends on Micron and Intel for any additional cash needs to be provided in the form of cash calls or member debt financing (MDF). Extensions of MDF may be converted to a capital contribution at the lender's request, or may be repaid upon availability of funds. During the first six months of 2019, IMFT repaid $316 million of MDF to Intel. The carrying balance of our equity method investment in IMFT as of June 29, 2019 is $1.3 billion.
In January 2019, Micron exercised its right to call ourunconsolidated variable interest in IMFT. The sale ofentity. We sold our non-controlling interest in IMFT to Micron is expected to close onin October 31, 2019. We will continue to purchase product manufactured by Micron at the IMFT facility for a periodunder supply agreements, which include the next generation of up to one year following the close date.3D XPoint™ technology.
ASML Holding N.V.

As of December 29, 2018, Intel owned $1.1 billion in ASML Holding N.V. (ASML). We have fully sold our equity investment in ASML.





NOTE 9 :BORROWINGS
During the first six months of 2019, we received proceeds of $601 million in aggregate from the sale of bonds issued by the Industrial Development Authority of the City of Chandler, Arizona (the Arizona bonds) and the State of Oregon Business Development Commission (the Oregon bonds). The bonds are our unsecured general obligations in accordance with loan agreements we entered into with the Industrial Development Authority of the City of Chandler, Arizona and the State of Oregon Business Development Commission. The bonds mature in 2049 and carry an interest rate of 5.0%. The Arizona bonds and the Oregon bonds are subject to mandatory tender in June 2024 and March 2022, respectively, at which time we can re-market the bonds as either fixed-rate bonds for a specified period or as variable-rate bonds until another fixed-rate period is selected or until their final maturity date.

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NOTE 108 :FAIR VALUEACQUISITIONS AND DIVESTITURES
ACQUISITIONS
For information aboutAcquisition of Moovit
On May 4, 2020, we acquired Moovit, a MaaS solutions company, for total consideration of $915 million. The fair values of the assets acquired relate to goodwill of $638 million and intangible assets of $331 million. The goodwill arising from the acquisition is attributed to the expected synergies and other benefits that will be generated from the combination of Intel and Moovit. We expect substantially all of the goodwill will not be deductible for local tax purposes. The acquisition-related intangible assets are primarily related to Moovit's monthly active user base and application platform. The goodwill and operating results of Moovit are included in our fair value policies, and methods and assumptions used in estimating the fair valueMobileye operating segment.
DIVESTITURES
Planned Divestiture of our financialHome Gateway Platform Division
We signed a definitive agreement on April 5, 2020 to sell the majority of Home Gateway Platform, a division of CCG. The transaction contemplates the transfer of certain employees, equipment, and an on-going supply agreement for future units. We reclassified the assets and liabilities as held-for-sale within other current assets/liabilities. We expect to close the transaction in the third quarter of 2020.







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NOTE 9 :BORROWINGS
As of June 27, 2020, our short-term debt was $2.3 billion, primarily comprised of the current portion of our long-term debt ($3.7 billion as of December 28, 2019).
We have an ongoing authorization from our Board of Directors to borrow up to $10.0 billion under our commercial paper program.
LONG-TERM DEBT
Jun 27, 2020Dec 28, 2019
(In Millions)Effective Interest RateAmountAmount
Floating-rate senior notes:
Three-month LIBOR plus 0.08%, due May 2020— %$—  $700  
Three-month LIBOR plus 0.35%, due May 20221.82 %800  800  
Fixed-rate senior notes:
1.85%, due May 2020— %—  1,000  
2.45%, due July 20202.48 %1,750  1,750  
1.70%, due May 20211.78 %500  500  
3.30%, due October 20212.98 %2,000  2,000  
2.35%, due May 20221.95 %750  750  
3.10%, due July 20222.69 %1,000  1,000  
4.00%, due December 2022¹3.11 %379  382  
2.70%, due December 20222.28 %1,500  1,500  
4.10%, due November 20233.21 %400  400  
2.88%, due May 20242.31 %1,250  1,250  
2.70%, due June 20242.13 %600  600  
3.40%, due March 20253.46 %1,500  —  
3.70%, due July 20253.48 %2,250  2,250  
2.60%, due May 20261.94 %1,000  1,000  
3.75%, due March 20273.80 %1,000  —  
3.15%, due May 20272.48 %1,000  1,000  
2.45%, due November 20292.39 %2,000  1,250  
3.90%, due March 20303.94 %1,500  —  
4.00%, due December 20322.30 %750  750 ��
4.60%, due March 20404.62 %750  —  
4.80%, due October 20413.53 %802  802  
4.25%, due December 20422.48 %567  567  
4.90%, due July 20453.45 %772  772  
4.10%, due May 20462.76 %1,250  1,250  
4.10%, due May 20472.63 %1,000  1,000  
4.10%, due August 20472.20 %640  640  
3.73%, due December 20472.89 %1,967  1,967  
3.25%, due November 20493.19 %2,000  1,500  
4.75%, due March 20504.76 %2,250  —  
3.10%, due February 20603.12 %1,000  —  
4.95%, due March 20605.00 %1,000  —  
Oregon and Arizona bonds:
2.40%-2.70%, due December 2035 - 20402.49 %423  423  
5.00%, due March 20492.12 %138  138  
5.00%, due June 20492.15 %438  438  
Junior Subordinated Convertible Debentures:
3.25%, due August 2039—  —  372  
Total Senior Notes and Other Borrowings36,926  28,751  
Unamortized Premium/Discount and Issuance Costs(375) (529) 
Hedge Accounting Fair Value Adjustments1,796  781  
Long-term debt38,347  29,003  
Current portion of long-term debt(2,254) (3,695) 
Total long-term debt$36,093  $25,308  
1 To manage foreign currency risk associated with the Australian-dollar-denominated notes issued in 2015, we entered into currency interest rate swaps with an aggregate notional amount of $396 million, which effectively converted these notes to U.S.-dollar-denominated notes. For further discussion on our currency interest rate swaps, see "Note 2: Accounting Policies"12: Derivative Financial Instruments."







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In the first six months of 2020, we settled $2.1 billion in short-term debt. In the first quarter of 2020, the remaining $372 million of our 2009 Debentures were converted or redeemed, and "Note 16: Fair Value" in the second quarter of 2020, we settled $1.7 billion of our 2018 Form 10-K.notes due May 2020.
In the first six months of 2020, we issued a total of $10.3 billion aggregate principal amount of senior notes. We intend to use the net proceeds from the offering for general corporate purposes, which may include refinancing outstanding debt, funding for working capital and capital expenditures, and repurchasing shares of our common stock. 
Our senior floating rate notes pay interest quarterly and our senior fixed rate notes pay interest semiannually. We may redeem the fixed rate notes prior to their maturity at our option at specified redemption prices and subject to certain restrictions. The obligations under the notes rank equally in right of payment with all of our other existing and future senior unsecured indebtedness and effectively rank junior to all liabilities of our subsidiaries.







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NOTE 10 :FAIR VALUE
ASSETS AND LIABILITIES MEASURED AND RECORDED AT FAIR VALUE ON A RECURRING BASIS
Jun 27, 2020Dec 28, 2019
Fair Value Measured and
Recorded at Reporting Date Using
 
Fair Value Measured and
Recorded at Reporting Date Using
 
(In Millions)Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
Cash equivalents:
Corporate debt$—  $715  $—  $715  $—  $713  $—  $713  
Financial institution instruments¹3,870  1,591  —  5,461  1,064  408  —  1,472  
Government debt²—  666  —  666  —  —  —  —  
Reverse repurchase agreements—  1,400  —  1,400  —  1,500  —  1,500  
Short-term investments:
Corporate debt—  1,426  —  1,426  —  347  —  347  
Financial institution instruments¹—  2,096  —  2,096  —  724  —  724  
Government debt²—  1,269  —  1,269  —  11  —  11  
Trading assets:
Corporate debt—  3,605  —  3,605  —  2,848  —  2,848  
Financial institution instruments¹206  2,304  —  2,510  87  1,578  —  1,665  
Government debt²—  6,173  —  6,173  —  3,334  —  3,334  
Other current assets:
Derivative assets30  250  —  280  50  230  —  280  
Loans receivable³—  348  —  348  —  —  —  —  
Marketable equity securities464  —  —  464  450  —  —  450  
Other long-term investments:
Corporate debt—  1,864  —  1,864  —  1,898  —  1,898  
Financial institution instruments¹—  452  —  452  —  825  —  825  
Government debt²—  568  —  568  —  553  —  553  
Other long-term assets:
Derivative assets—  1,679  35  1,714  —  690  16  706  
Loans receivable³—  212  —  212  —  554  —  554  
Total assets measured and recorded at fair value$4,570  $26,618  $35  $31,223  $1,651  $16,213  $16  $17,880  
Liabilities
Other accrued liabilities:
Derivative liabilities$48  $432  $—  $480  $3  $287  $—  $290  
Other long-term liabilities:
Derivative liabilities—  22  —  22  —  13  —  13  
Total liabilities measured and recorded at fair value$48  $454  $—  $502  $3  $300  $—  $303  
  June 29, 2019 December 29, 2018
  
Fair Value Measured and
Recorded at Reporting Date Using
  
Fair Value Measured and
Recorded at Reporting Date Using
 
(In Millions) Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Assets                
Cash equivalents:                
Corporate debt $—
 $417
 $—
 $417
 $—
 $262
 $—
 $262
Financial institution instruments¹ 410
 343
 —
 753
 550
 183
 —
 733
Reverse repurchase agreements —
 1,300
 —
 1,300
 —
 1,850
 —
 1,850
Short-term investments:                
Corporate debt —
 810
 —
 810
 —
 937
 —
 937
Financial institution instruments¹ —
 1,324
 —
 1,324
 —
 1,423
 —
 1,423
Government debt² —
 280
 —
 280
 —
 428
 —
 428
Trading assets:                
Corporate debt —
 2,755
 —
 2,755
 —
 2,635
 —
 2,635
Financial institution instruments¹ 54
 1,470
 —
 1,524
 67
 1,273
 —
 1,340
Government debt² —
 2,384
 —
 2,384
 —
 1,868
 —
 1,868
Other current assets:                
Derivative assets 29
 225
 —
 254
 —
 180
 —
 180
Loans receivable³ —
 57
 —
 57
 —
 354
 —
 354
Marketable equity securities 197
 —
 —
 197
 1,440
 —
 —
 1,440
Other long-term investments:                
Corporate debt —
 1,974
 —
 1,974
 —
 1,843
 —
 1,843
Financial institution instruments¹ —
 974
 —
 974
 —
 912
 —
 912
Government debt² —
 629
 —
 629
 —
 633
 —
 633
Other long-term assets:                
Derivative assets —
 689
 —
 689
 —
 100
 —
 100
Loans receivable³ —
 507
 —
 507
 —
 229
 —
 229
Total assets measured and recorded at fair value 690
 16,138
 —
 16,828
 2,057
 15,110
 —
 17,167
Liabilities                
Other accrued liabilities:                
Derivative liabilities —
 303
 —
 303
 —
 412
 —
 412
Other long-term liabilities:                
Derivative liabilities —
 15
 18
 33
 —
 415
 68
 483
Total liabilities measured and recorded at fair value $—
 $318
 $18
 $336
 $—
 $827
 $68
 $895
1Level 1 investments consist of money market funds. Level 2 investments consist primarily of commercial paper, certificates of deposit, time deposits, and notes and bonds issued by financial institutions.
2Level 2 investments consist primarily of U.S. agency notes and non-U.S. government debt.
3The fair value of our loans receivable for which we elected the fair value option did not significantly differ from the contractual principal balance based on the contractual currency.







1
Level 1 investments consist of money market funds. Level 2 investments consist primarily of commercial paper, certificates of deposit, time deposits, and notes and bonds issued by financial institutions.
2
Level 2 investments consist primarily of U.S. agency notes and non-U.S. government debt.
3
The fair value of our loans receivable for which we elected the fair value option did not significantly differ from the contractual principal balance based on the contractual currency.

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ASSETS MEASURED AND RECORDED AT FAIR VALUE ON A NON-RECURRING BASIS
Our non-marketable equity securities, equity method investments, and certain non-financial assets, such as intangible assets and property, plant and equipment, are recorded at fair value only if an impairment or observable price adjustment is recognized in the current period. If an observable price adjustment or impairment is recognized on our non-marketable equity securities during the period, we classify these assets as Level 3 within the fair value hierarchy based on the nature of the fair value inputs.
FINANCIAL INSTRUMENTS NOT RECORDED AT FAIR VALUE ON A RECURRING BASIS
Financial instruments not recorded at fair value on a recurring basis include non-marketable equity securities (thatand equity method investments that have not been re-measuredremeasured or impaired in the current period), equity method investments,period, grants receivable, loans receivable, reverse repurchase agreements with original maturities greater than three months, and our short-term and long-termissued debt.
As of June 29, 2019,27, 2020, the aggregate carrying value of grants receivable loans receivable, and reverse repurchase agreements with original maturities greater than three months was $1.1 billion (the aggregate carrying amount$301 million ($543 million as of December 29, 2018 was $833 million)28, 2019). The estimated fair value of these financial instruments approximates their carrying value and is categorized as Level 2 within the fair value hierarchy based on the nature of the fair value inputs.
As of June 29, 2019,27, 2020, the fair value of short and long-termour issued debt (excluding drafts payable) was $30.042.5 billion (the fair value$30.6 billion as of December 29, 2018 was $27.1 billion)28, 2019). These liabilities are classified as Level 2 within the fair value hierarchy based on the nature of the fair value inputs.
NOTE 11 :OTHER COMPREHENSIVE INCOME (LOSS)
The changes in accumulated other comprehensive income (loss) by component and related tax effects in the first six months of 2020 were as follows:
(In Millions)Unrealized Holding Gains (Losses) on DerivativesActuarial Valuation and Other Pension ExpensesTranslation Adjustments and OtherTotal
Balance as of December 28, 2019$54  $(1,382) $48  $(1,280) 
Other comprehensive income (loss) before reclassifications19  (2) 69  86  
Amounts reclassified out of accumulated other comprehensive income (loss)60  28  —  88  
Tax effects(28) (3) (15) (46) 
Other comprehensive income (loss)51  23  54  128  
Balance as of June 27, 2020$105  $(1,359) $102  $(1,152) 
We estimate that we will reclassify approximately $48 million (before taxes) of net derivative gains included in accumulated other comprehensive income (loss) into earnings within the next 12 months.







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NOTE 1112 :DERIVATIVE FINANCIAL INSTRUMENTS
For further information on our derivative policies, see "Note 2: Accounting Policies" in our 2018 Form 10-K.
VOLUME OF DERIVATIVE ACTIVITY
Total gross notional amounts for outstanding derivatives (recorded at fair value) at the end of each period were as follows: 
(In Millions) Jun 29,
2019		 Dec 29,
2018		(In Millions)Jun 27, 2020Dec 28, 2019
Foreign currency contracts $23,293
 $19,223
Foreign currency contracts$29,129  $23,981  
Interest rate contracts 22,292
 22,447
Interest rate contracts14,349  14,302  
Other 1,633
 1,356
Other1,787  1,753  
Total $47,218
 $43,026
Total$45,265  $40,036  
FAIR VALUE OF DERIVATIVE INSTRUMENTS
 Jun 27, 2020Dec 28, 2019
(In Millions)
Assets1
Liabilities2
Assets1
Liabilities2
Derivatives designated as hedging instruments:
Foreign currency contracts3
$76  $81  $56  $159  
Interest rate contracts1,713  —  690  9  
Total derivatives designated as hedging instruments1,789  81  746  168  
Derivatives not designated as hedging instruments:
Foreign currency contracts3
171  224  179  78  
Interest rate contracts4  149  11  54  
Equity contracts30  48  50  3  
Total derivatives not designated as hedging instruments205  421  240  135  
Total derivatives$1,994  $502  $986  $303  
  June 29, 2019 December 29, 2018
(In Millions) 
Assets1
 
Liabilities2
 
Assets1
 
Liabilities2
Derivatives designated as hedging instruments:        
Foreign currency contracts3
 $106
 $90
 $44
 $244
Interest rate contracts 669
 20
 84
 474
Total derivatives designated as hedging instruments 775
 110
 128
 718
Derivatives not designated as hedging instruments:        
Foreign currency contracts3
 134
 170
 132
 155
Interest rate contracts 5
 52
 20
 22
Equity Contracts 29
 4
 —
 —
Total derivatives not designated as hedging instruments 168
 226
 152
 177
Total derivatives $943
 $336
 $280
 $895
1Derivative assets are recorded as other assets, current and non-current.
2Derivative liabilities are recorded as other liabilities, current and non-current.
3The majority of these instruments mature within 12 months.








1
Derivative assets are recorded as other assets, current and non-current.
2
Derivative liabilities are recorded as other liabilities, current and non-current.
3
The majority of these instruments mature within 12 months.


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AMOUNTS OFFSET IN THE CONSOLIDATED CONDENSED BALANCE SHEETS
The gross amounts of our derivative instruments and reverse repurchase agreements subject to master netting arrangements with various counterparties, and cash and non-cash collateral posted under such agreements at the end of each period were as follows:
Jun 27, 2020
Gross Amounts Not Offset in the Balance Sheet
(In Millions)Gross Amounts RecognizedGross Amounts Offset in the Balance SheetNet Amounts Presented in the Balance SheetFinancial InstrumentsCash and Non-Cash Collateral Received or PledgedNet Amount
Assets:
Derivative assets subject to master netting arrangements$1,985  $—  $1,985  $(318) $(1,641) $26  
Reverse repurchase agreements1,500  —  1,500  —  (1,489) 11  
Total assets$3,485  $—  $3,485  $(318) $(3,130) $37  
Liabilities:
Derivative liabilities subject to master netting arrangements$397  $—  $397  $(318) $(79) $—  
Total liabilities$397  $—  $397  $(318) $(79) $—  
  June 29, 2019
        Gross Amounts Not Offset in the Balance Sheet  
(In Millions) Gross Amounts Recognized Gross Amounts Offset in the Balance Sheet Net Amounts Presented in the Balance Sheet Financial Instruments Cash and Non-Cash Collateral Received or Pledged Net Amount
Assets:            
Derivative assets subject to master netting arrangements $937
 $—
 $937
 $(258) $(679) $—
Reverse repurchase agreements 1,650
 —
 1,650
 —
 (1,650) —
Total assets 2,587
 —
 2,587
 (258) (2,329) —
Liabilities:            
Derivative liabilities subject to master netting arrangements 325
 —
 325
 (258) (62) 5
Total liabilities $325
 $—
 $325
 $(258) $(62) $5
  December 29, 2018
        Gross Amounts Not Offset in the Balance Sheet  
(In Millions) Gross Amounts Recognized Gross Amounts Offset in the Balance Sheet Net Amounts Presented in the Balance Sheet Financial Instruments Cash and Non-Cash Collateral Received or Pledged Net Amount
Assets:            
Derivative assets subject to master netting arrangements $292
 $—
 $292
 $(220) $(72) $—
Reverse repurchase agreements 2,099
 —
 2,099
 —
 (1,999) 100
Total assets 2,391
 —
 2,391
 (220) (2,071) 100
Liabilities:            
Derivative liabilities subject to master netting arrangements 890
 —
 890
 (220) (576) 94
Total liabilities $890
 $—
 $890
 $(220) $(576) $94

Dec 28, 2019
Gross Amounts Not Offset in the Balance Sheet
(In Millions)Gross Amounts RecognizedGross Amounts Offset in the Balance SheetNet Amounts Presented in the Balance SheetFinancial InstrumentsCash and Non-Cash Collateral Received or PledgedNet Amount
Assets:
Derivative assets subject to master netting arrangements$974  $—  $974  $(144) $(808) $22  
Reverse repurchase agreements1,850  —  1,850  —  (1,850) —  
Total assets$2,824  $—  $2,824  $(144) $(2,658) $22  
Liabilities:
Derivative liabilities subject to master netting arrangements$262  $—  $262  $(144) $(72) $46  
Total liabilities$262  $—  $262  $(144) $(72) $46  
We obtain and secure available collateral from counterparties against obligations, including securities lending transactions and reverse repurchase agreements, when we deem it appropriate.
DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS
The before-tax net gains or losses attributed to the effective portion of cash flow hedges, recognized in other comprehensive income (loss), were $122$392 million net gains in the second quarter of 2020 and $19 million net gains in the first six months of 2020 ($122 million net gains in the second quarter of 2019 and $151 million net gains in the first six months of 2019 ($339 million net losses in the second quarter of 2018 and $134 million net losses in the first six months of 2018)2019). Substantially all of our cash flow hedges were foreign currency contracts for all periods presented.
During the first six months of 20192020 and 2018,2019, the amounts excluded from effectiveness testing were insignificant.







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DERIVATIVES IN FAIR VALUE HEDGING RELATIONSHIPS
The effects of derivative instruments designated as fair value hedges, recognized in interest and other, net for each period were as follows:
  Three Months Ended Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Interest rate contracts $554
 $(113) $1,039
 $(371)
Hedged items (554) 113
 (1,039) 371
Total $—
 $—
 $—
 $—

Gains (Losses) Recognized in Consolidated Condensed Statements of Income on Derivatives
Three Months EndedSix Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Interest rate contracts$78  $554  $1,032  $1,039  
Hedged items(78) (554) (1,032) (1,039) 
Total$—  $—  $—  $—  
The amounts recorded on the consolidated condensed balance sheetsConsolidated Condensed Balance Sheets related to cumulative basis adjustments for fair value hedges for each period were as follows:
Line Item in the Consolidated Condensed Balance Sheet in Which the Hedged Item is Included Carrying Amount of the Hedged Item Asset/(Liabilities) Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount Assets/(Liabilities)
Years Ended
(In Millions)		 Jun 29,
2019		 Dec 29,
2018		 Jun 29,
2019		 Dec 29,
2018
Long-term debt $(20,661) $(19,622) $(649) $390

As of June 29, 2019 and December 29, 2018, the
Line Item in the Consolidated Condensed Balance Sheet in Which the Hedged Item is IncludedCarrying Amount of the Hedged Item Asset/(Liabilities)Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount Assets/(Liabilities)
(In Millions)Jun 27, 2020Dec 28, 2019Jun 27, 2020Dec 28, 2019
Long-term debt$(13,710) $(12,678) $(1,713) $(681) 
The total notional amount of pay variable/receive fixed-interestpay-variable and receive-fixed interest rate swaps was $20.0 billion.$12.0 billion as of June 27, 2020 and as of December 28, 2019.
DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS
The effects of derivative instruments not designated as hedging instruments on the consolidated condensed statementsConsolidated Condensed Statements of incomeIncome for each period were as follows:
    Three Months Ended Six Months Ended
(In Millions) 
Location of Gains (Losses)
Recognized in Income on Derivatives
 Jun 29,
2019		 Jun 30,
2018		 Jun 29,
2019		 Jun 30,
2018
Foreign currency contracts Interest and other, net $(20) $438
 $37
 $268
Interest rate contracts Interest and other, net (25) 6
 (39) 20
Other Various 35
 27
 181
 (4)
Total   $(10) $471
 $179
 $284

  Three Months EndedSix Months Ended
(In Millions)
Location of Gains (Losses)
Recognized in Income on Derivatives
Jun 27, 2020Jun 29, 2019Jun 27, 2020Jun 29, 2019
Foreign currency contractsInterest and other, net$(216) $(20) $(62) $37  
Interest rate contractsInterest and other, net(14) (25) (91) (39) 
OtherVarious225  35  (43) 181  
Total$(5) $(10) $(196) $179  
NOTE 1213 :CONTINGENCIES
LEGAL PROCEEDINGS
We are a party to various legal proceedings, including those noted in this section. Although management at present believes that the ultimate outcome of these proceedings, individually and in the aggregate, will not materially harm our financial position, results of operations, cash flows, or overall trends, legal proceedings and related government investigations are subject to inherent uncertainties, and unfavorable rulings or other events could occur. Unfavorable resolutions could include substantial monetary damages. In addition, in matters for which injunctive relief or other conduct remedies are sought, unfavorable resolutions could include an injunction or other order prohibiting us from selling one or more products at all or in particular ways, precluding particular business practices, or requiring other remedies. An unfavorable outcome may result in a material adverse impact on our business, results of operations, financial position, and overall trends. We might also conclude that settling one or more such matters is in the best interests of our stockholders, employees, and customers, and any such settlement could include substantial payments. Except as specifically described below, we have not concluded that settlement of any of the legal proceedings noted in this section is appropriate at this time.







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European Commission Competition Matter
In 2001, the European Commission (EC)EC commenced an investigation regarding claims by Advanced Micro Devices, Inc. (AMD) that we used unfair business practices to persuade customers to buy our microprocessors. We received numerous requests for information and documents from the EC and we responded to each of those requests. The EC issued a Statement of Objections in July 2007 and held a hearing on that Statement in March 2008. The EC issued a Supplemental Statement of Objections in July 2008. In May 2009, the EC issued a decision finding that we had violated Article 82 of the EC Treaty and Article 54 of the European Economic Area Agreement. In general, the EC found that we violated Article 82 (later renumbered as Article 102 by a new treaty) by offering alleged "conditional rebates and payments" that required our customers to purchase all or most of their x86 microprocessors from us. The EC also found that we violated Article 82 by making alleged "payments to prevent sales of specific rival products." The EC imposed a fine in the amount of €1.1 billion ($1.4 billion as of May 2009), which we subsequently paid during the third quarter of 2009, and ordered us to "immediately bring to an end the infringement referred to in" the EC decision.
The EC decision contained no specific direction on whether or how we should modify our business practices. Instead, the decision stated that we should "cease and desist" from further conduct that, in the EC's opinion, would violate applicable law. We took steps, which are subject to the EC's ongoing review, to comply with that decision pending appeal. We had discussions with the EC to better understand the decision and to explain changes to our business practices.
We appealed the EC decision to the Court of First Instance (which has been renamed the General Court) in July 2009. The hearing of our appeal took place in July 2012. In June 2014, the General Court rejected our appeal in its entirety. In August 2014, we filed an appeal with the European Court of Justice. In November 2014, Intervener Association for Competitive Technologies filed comments in support of Intel’s grounds of appeal. The EC and interveners filed briefs in November 2014, we filed a reply in February 2015, and the EC filed a rejoinder in April 2015. The Court of Justice held oral argument in June 2016. In October 2016, Advocate General Wahl, an advisor to the Court of Justice, issued a non-binding advisory opinion that favored Intel on a number of grounds. The Court of Justice issued its decision in September 2017, setting aside the judgment of the General Court and sending the case back to the General Court to examine whether the rebates at issue were capable of restricting competition. The General Court has appointed a panel of five judges to consider our appeal of the EC’s 2009 decision in light of the Court of Justice’s clarifications of the law. In November 2017, the parties filed initial “Observations” about the Court of Justice’s decision and the appeal and were invited by the General Court to offer supplemental comments to each other’s “Observations,” which the parties submitted in March 2018. Responses to other questions posed by the General Court were filed in May and June 2018. We are now awaiting notice as to whether theThe General Court will hold a management conference before it conductsheard oral argument at some future date.in March 2020. Pending the final decision in this matter, the fine paid by Intel has been placed by the EC in commercial bank accounts where it accrues interest.
McAfee, Inc. Shareholder Litigation
On August 19, 2010, we announced that we had agreed to acquire all of the common stock of McAfee, Inc. (McAfee) for $48.00 per share. Four McAfee shareholders filed putative class-action lawsuits in Santa Clara County, California Superior Court challenging the proposed transaction. The cases were ordered consolidated in September 2010. Plaintiffs filed an amended complaint that named former McAfee board members, McAfee, and Intel as defendants, and alleged that the McAfee board members breached their fiduciary duties and that McAfee and Intel aided and abetted those breaches of duty. The complaint requested rescission of the merger agreement, such other equitable relief as the court may deem proper, and an award of damages in an unspecified amount. In June 2012, the plaintiffs’ damages expert asserted that the value of a McAfee share for the purposes of assessing damages should be $62.08.
In January 2012, the court certified the action as a class action, appointed the Central Pension Laborers’ Fund to act as the class representative, and scheduled trial to begin in January 2013. In March 2012, defendants filed a petition with the California Court of Appeal for a writ of mandate to reverse the class certification order; the petition was denied in June 2012. In March 2012, at defendants’ request, the court held that plaintiffs were not entitled to a jury trial and ordered a bench trial. In April 2012, plaintiffs filed a petition with the California Court of Appeal for a writ of mandate to reverse that order, which the court of appeal denied in July 2012. In August 2012, defendants filed a motion for summary judgment. The trial court granted that motion in November 2012, and entered final judgment in the case in February 2013. In April 2013, plaintiffs appealed the final judgment. The California Court of Appeal heard oral argument in October 2017, and in November 2017, affirmed the judgment as to McAfee's nine outside directors, reversed the judgment as to former McAfee director and chief executive officer David DeWalt, Intel, and McAfee, and affirmed the trial court's ruling that the plaintiffs are not entitled to a jury trial. At a June 2018 case management conference following remand, the Superior Court set an October hearing date for any additional summary judgment motions that may be filed, and set trial to begin in December 2018. In July 2018, plaintiffs filed a motion for leave to amend the complaint, which the court denied in September 2018. Also in July 2018, McAfee and Intel filed a motion for summary judgment on the aiding and abetting claims asserted against them; in October 2018, the court granted the motion as to McAfee and denied the motion as to Intel.
The parties agreed in principle to settle the case in late October 2018, and finalized the settlement agreement in March 2019. The settlement agreement calls for an aggregate payment by defendants of $12 million. Intel’s contribution to the settlement will be immaterial to its financial statements. In May 2019, the court granted plaintiffs’ motion for preliminary approval of the settlement and scheduled a final approval hearing for October 2019.

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Litigation Related to Security Vulnerabilities
In June 2017, a Google research team notified us and other companies that it had identified security vulnerabilities (now commonly referred to as “Spectre” and “Meltdown”) that affect many types of microprocessors, including our products. As is standard when findings like these are presented, we worked together with other companies in the industry to verify the research and develop and validate software and firmware updates for impacted technologies. On January 3, 2018, information on the security vulnerabilities was publicly reported, before software and firmware updates to address the vulnerabilities were made widely available. Numerous lawsuits relating to the Spectre and Meltdown security vulnerabilities, as well as another variant of these vulnerabilities (“Foreshadow”) that has since been identified, have been filed against Intel and, in certain cases, our current and former executives and directors, in U.S. federal and state courts and in certain courts in other countries relating to the Spectre and Meltdown security vulnerabilities, as well as another variant of these vulnerabilities (“Foreshadow”) that has since been identified.countries.
As of July 24, 2019, 4822, 2020, consumer class action lawsuits relating to certain security vulnerabilities publicly disclosed in 2018 were pending in the U.S., Canada, and three securities class action lawsuits have been filed.Israel. The securities class actions, which were consolidated, were dismissed with prejudice in April 2019. The consumer class action plaintiffs, who purport to represent various classes of end userspurchasers of our products, generally claim to have been harmed by Intel's actions and/or omissions in connection with the security vulnerabilities and assert a variety of common law and statutory claims seeking monetary damages and equitable relief. OfIn the consumerU.S., numerous individual class action lawsuits, 44 have beensuits filed in the U.S., two of which have been dismissed; two have been filedvarious jurisdictions were consolidated in Canada; and two have been filed in Israel. In April 2018 the U.S. Judicial Panel on Multidistrict Litigation ordered the U.S. consumer class action lawsuits consolidated for all pretrial proceedings in the U.S. District Court for the District of Oregon. Intel filed aIn March 2020, the court granted Intel's motion to dismiss the complaint in that consolidated action but granted plaintiffs leave to file an amended complaint, which they did in October 2018, and a hearing on that motion was heldApril 2020. In Canada, in February 2019. In theone case pending in the Superior Court of Justice of Ontario, an initial status conference has not yet been scheduled. In thea second case pending in the Superior Court of Justice of Quebec, the court entered an order in October 2018, staying thathas stayed the case for one year.until January 2021. In Israel, both consumer class action lawsuits were filed in the District Court of Haifa. In the first case, the District Court denied the parties' joint motion to stay filed in January 2019, but to date has deferred Intel’sIntel's deadline to respond to the complaint in view of Intel’sIntel's pending motion to dismiss in the consolidated class actionproceeding in the U.S. Intel filed a motion to stay the second case pending resolution of the consolidated class actionproceeding in the U.S., and a hearing on that motion has been rescheduledscheduled for September 2019. In the securities class action litigation, the lead securities class action plaintiffs, who purported to represent classes of acquirers of Intel stock between October 27, 2017 and January 9, 2018, generally alleged that Intel and certain officers violated securities laws by making statements about Intel's products that were revealed to be false or misleading by the disclosure of the security vulnerabilities. The securities class actions were consolidated and were pending in the U.S. District Court for the Northern District of California. Defendants filed a motion to dismiss those actions in August 2018, which the court granted in March 2019. The court's order granted plaintiffs leave to amend their complaint, but the case was dismissed with prejudice in April 2019 after plaintiffs elected not to re-plead. Plaintiffs did not appeal.November 2020. Additional lawsuits and claims may be asserted on behalf of customers and shareholders seeking monetary damages or other related relief. We dispute the pending claims described above and intend to defend those lawsuits vigorously. Given the procedural posture and the nature of those cases, including that the pending proceedings are in the early stages, that alleged damages have not been specified, that uncertainty exists as to the likelihood of a class or classes being certified or the ultimate size of any class or classes if certified, and that there are significant factual and legal issues to be resolved, we are unable to make a reasonable estimate of the potential loss or range of losses, if any, that might arise from those matters.







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  Notes to Financial Statements24
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In addition to these lawsuits, Intel stockholders have filed sevenmultiple shareholder derivative lawsuits since January 2018 against certain current and former members of our Board of Directors and certain current and former officers, alleging that the defendants breached their duties to Intel in connection with the disclosure of the security vulnerabilities and the failure to take action in relation to alleged insider trading. The complaints seeksought to recover damages from the defendants on behalf of Intel. ThreeSome of the derivative actions were filed in the U.S. District Court for the Northern District of California and were consolidated, and the other fourothers were filed in the Superior Court of the State of California in San Mateo County and were consolidated. In August 2018, theThe federal court granted defendants' motion to dismiss the consolidated complaint in the federal action in August 2018 on the ground that plaintiffs failed to plead facts sufficient to show they were excused from making a pre-lawsuit demand on the Board. The federal court granted plaintiffs leave to amend their complaint, but in September 2018, plaintiffs instead requested thatsubsequently dismissed the action be dismissed. The federal court ordered the case dismissedcases without prejudice in January 2019.2019 at plaintiffs' request. In August 2018, the California Superior Court granted defendants' motion to dismiss the consolidated complaint in the state court action on the ground that plaintiffs failed to plead facts sufficient to show they were excused from making a pre-lawsuit demand on the Board.Board, but granted plaintiffs leave to amend. The court subsequently granted defendants' motion to dismiss plaintiffs' first, second, and third amended complaints, on the same ground, and in March 2020 granted defendants' motion to dismiss plaintiffs' third amended complaint without granting plaintiffs leave to amend. Plaintiffs filed a motion for reconsideration of the court's final order of dismissal, which is scheduled for hearing on July 31, 2020.
Institute of Microelectronics, Chinese Academy of Sciences v. Intel China, Ltd., et al.
In February 2018, the Institute of Microelectronics of the Chinese Academy of Sciences (IMECAS) sued Intel China, Ltd., Dell China, Ltd. (Dell) and Beijing JingDong Century Information Technology, Ltd. (JD) for patent infringement in the Beijing High Court. IMECAS alleges that Intel’s Core series processors infringe Chinese patent CN 102956457 (’457 Patent). The complaint demands an amendedinjunction and damages of at least RMB 200,000,000 plus the cost of litigation. A trial date is not yet set. In March 2018, Dell tendered indemnity to Intel, which Intel granted in April 2018. JD also tendered indemnity to Intel, which Intel granted in October 2018. In March 2018, Intel filed an invalidation request on the ‘457 patent with the Chinese Patent Reexamination Board (PRB). The PRB held an oral hearing in September 2018 and in February 2019 upheld the validity of the challenged claims. In January 2020, Intel filed a second invalidation request on the ‘457 patent with the PRB. In September 2018 and March 2019, Intel filed petitions with the United States Patent & Trademark Office (USPTO) requesting institution of inter partes review (IPR) of U.S. Patent No. 9,070,719, the U.S. counterpart to the ‘457 patent. The USPTO denied institution of Intel’s petitions in March and October 2019, respectively. In April 2019, Intel filed a request for rehearing and a petition for Precedential Opinion Panel (POP) in the USPTO to challenge the denial of its first IPR petition, and in November 2019 Intel filed a request for rehearing on the second IPR petition. In January 2020, the USPTO denied the POP petition on the first IPR petition. In June 2020, the Patent Trial and Appeal Board denied Intel's rehearing requests on both petitions.
In October 2019, IMECAS filed second and third lawsuits, in the Beijing IP Court, alleging infringement of Chinese Patent No. CN 102386226 (‘226 Patent) based on the manufacturing and sale of Intel’s Core i3 microprocessors. Defendants in the second case are Lenovo (Beijing) Co., Ltd. (Lenovo) and Beijing Jiayun Huitong Technology Development Co. Ltd. (BJHT). Defendants in the third case are Intel Corp., Intel China Co., Ltd., the Intel China Beijing Branch, Beijing Digital China Co., Ltd. (Digital China), and JD. Both complaints demand injunctions plus litigation costs and reserve the right to claim damages in unspecified amounts. No proceedings have occurred or are yet scheduled in these lawsuits. In December 2019, Lenovo tendered indemnity to Intel, which Intel granted in March 2020. In July 2020, Intel filed two invalidation requests on the '226 patent with the Chinese PRB. Given the procedural posture and the nature of these cases, the unspecified nature and extent of damages claimed by IMECAS, and uncertainty regarding the availability of injunctive relief under applicable law, we are unable to make a reasonable estimate of the potential loss or range of losses, if any, arising from these matters. We dispute IMECAS’s claims and intend to vigorously defend against them.
VLSI Technology LLC v. Intel
In October 2017, VLSI Technology LLC (VLSI) filed a complaint against Intel in the U.S. District Court for the Northern District of California alleging infringement of eight patents acquired from NXP Semiconductors, N.V. (NXP). The patents, which originated at Freescale Semiconductor, Inc. and NXP B.V., are U.S. Patent Nos. 7,268,588; 7,675,806; 7,706,207; 7,709,303; 8,004,922; 8,020,014; 8,268,672; and 8,566,836. VLSI accuses various FPGA and processor products of infringement. VLSI estimated its damages to be as high as $7.1 billion, and its complaint further sought enhanced damages, future royalties, attorneys’ fees, and costs and interest. In May, June, September, and October 2018, Intel filed requests with the Patent Trial and Appeals Board (PTAB) to institute inter partes review of the patentability of claims in all eight of the patents in-suit. The PTAB instituted review of six patents and denied institution on two patents. As a result of the institution decisions, the parties stipulated to stay the District Court action in March 2019. In December 2019 and February 2020, the PTAB found all claims of the '588 and '303 patents, and some claims of the '922 patent, to be unpatentable. The PTAB found the challenged claims of the '014, '672 and '207 patents to be patentable. Intel moved for a continuation of the stay in March 2020 as it appealed certain rulings by the PTAB. In June 2020, the District Court issued an order continuing the stay through August 2021 and setting trial for December 2022.
In June 2018, VLSI filed a second suit against Intel, in U.S. District Court for the District of Delaware, alleging infringement by various Intel processors of five additional patents acquired from NXP: U.S. Patent Nos. 6,212,663; 7,246,027; 7,247,552; 7,523,331; and 8,081,026. VLSI accused Intel of willful infringement and seeks an injunction or, in the alternative, ongoing royalties, enhanced damages, attorneys’ fees and costs, and interest. In March 2019, the District Court dismissed VLSI’s claims for willful infringement as to all the patents-in-suit except the ‘027 patent, and also dismissed VLSI’s allegations of indirect infringement as to the ‘633, ‘331, and ‘026 patents. In June 2019, Intel filed requests for inter partes review of the patentability of claims in all five patents-in-suit. In January 2020, the District Court vacated the November 2020 trial date based on agreement of the parties; no trial date is currently set. In January and February 2020, the PTAB instituted review of the '552, '633, '331 and '026 patents and as a result Intel moved for stay of the District Court proceedings. In May 2020, the District Court stayed the case as to the '026 and '552 patents but allowed the case to proceed on the '027 and '331 patents. VLSI is no longer asserting claims from the '633 patent.







intc-20200627_g15.jpgFINANCIAL STATEMENTS
  Notes to Financial Statements25
Table of Contents

In March 2019, VLSI filed a third suit against Intel, also in U.S. District Court for the District of Delaware, alleging infringement of six more patents acquired from NXP: U.S. Patent Nos. 6,366,522; 6,663,187; 7,292,485; 7,606,983; 7,725,759; and 7,793,025. In April 2019, VLSI voluntarily dismissed this Delaware case without prejudice, in favor of asserting these patents in new cases in the U.S. District Court for the Western District of Texas (WDTX). Specifically, in April 2019, whichVLSI filed three new infringement suits against Intel in WDTX accusing various Intel processors of infringement. The three suits collectively assert the same six patents from the voluntarily dismissed Delaware case plus two additional patents acquired from NXP, U.S. Patent Nos. 7,523,373 and 8,156,357. VLSI accuses Intel of willful infringement and seeks an injunction or, in the alternative, ongoing royalties, enhanced damages, attorneys’ fees and costs, and interest. The District Court has set trial for November 2020. In October and November 2019, and in February 2020, Intel filed inter partes review requests on certain asserted claims across six of the patents-in-suit in WDTX. In May and June 2020, the PTAB denied Intel's requests on four of those patents, and Intel has asked for a rehearing on those matters.
In May 2019, VLSI filed a case in Shenzhen Intermediate People’s Court against Intel, Intel (China) Co., Ltd., Intel Trading (Shanghai) Co., Ltd., and Intel Products (Chengdu) Co., Ltd. VLSI asserts Chinese Patent 201410094015.9 accusing Intel Core processors of infringement. VLSI requests an injunction as well as RMB 1.3 million in damages. Defendants filed an invalidation petition in October 2019. In May 2020, defendants filed a motion to stay the trial court proceedings pending a determination on invalidity. The court has not yet ruled on the motion to stay.
In May 2019, VLSI filed a second case in Shanghai Intellectual Property Court against Intel (China) Co., Ltd., Intel Trading (Shanghai) Co., Ltd., and Intel Products (Chengdu) Co., Ltd. VLSI asserts Chinese Patent 201080024173.7. The accused Intel products and the claims of VLSI in Shanghai case are the same as in the Shenzhen case. Defendants filed an invalidation petition in October 2019. In June 2020, defendants filed a motion to stay the trial court proceedings pending a determination on invalidity. The court has not yet ruled on the motion to stay.
In October 2019, Intel filed a complaint against Fortress Investment Group LLC, Fortress Credit Co. LLC, VLSI, and DSS Technology Management, Inc. for violations of the Sherman Act, the Clayton Act, and California Business and Professions Code section 17200. In November 2019, Intel voluntarily dismissed that complaint and, along with Apple Inc., filed a new complaint against Fortress Investment Group LLC, Fortress Credit Co. LLC, Uniloc 2017 LLC, Uniloc USA, Inc., Uniloc Luxembourg S.A.R.L., VLSI, INVT SPE LLC, Inventergy Global, Inc., DSS Technology Management, Inc., IXI IP, LLC, and Seven Networks, LLC. Plaintiffs allege violations of Section 1 of the Sherman Act by certain defendants, Section 7 of the Clayton Act by certain defendants, and California Business and Professions Code section 17200 by all defendants based on defendants' unlawful aggregation of patents. Apple alone also alleges certain violations of California Business and Professions Code section 17200 by some defendants. In February 2020, defendants moved to dismiss onplaintiffs' complaint. In July 2020, the same grounds. A hearing oncourt granted defendants’ motion to dismiss, giving plaintiffs leave to amend by August 2020. The court dismissed antitrust claims related to two DSS patents with prejudice.
Given the motion is scheduled for July 2019.procedural posture and the nature of these cases and that there are significant factual and legal issues to be resolved, we are unable to make a reasonable estimate of the potential loss or range of losses, if any, arising from these matters. We dispute VLSI’s claims and intend to vigorously defend against them.










intc-20200627_g15.jpgFINANCIAL STATEMENTS
  Notes to Financial Statements26
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KEY TERMS
We use terms throughout our document that are specific to Intel or that are abbreviations that may not be commonly known or used. Below is a list of these terms used in our document.
TERMDEFINITION
a002intellogofootera01.jpg  FINANCIAL STATEMENTS
  Notes to Financial Statements20


Table of Contents


2009 Debentures3.25% junior subordinated convertible debentures due 2039
MANAGEMENT'S DISCUSSION AND ANALYSIS (MD&A)
Total revenue of $16.5 billion declined year over year as our data-centric businesses were down 7%; this was partially offset by 1% growth in our PC-centric business. Data-centric revenue was down compared to a year ago as cloud customers absorbed capacity, data center total addressable market (TAM) for the quarter contracted in the enterprise and government market segment, China demand weakened, and NAND pricing remained under pressure. Our PC-centric business was up driven by average selling price (ASP) strength with richer commercial segment mix and modem growth. PC client volume declined on small core supply constraint partially offset by sales pull-ins by customers in anticipation of tariff impacts. Lower platform unit sales and further margin compression on memory products resulted in lower gross margins and operating income, which was partially offset by executing the quarter with continued operating margin leverage. In the first six months we generated $12.5 billion of cash flow from operations and returned $8.4 billion to stockholders, including $2.8 billion in dividends and $5.6 billion in buybacks. For key highlights of the results of our operations, see "A Quarter in Review."
  Three Months Ended Six Months Ended
  Q2 2019 Q2 2018 YTD 2019 YTD 2018
(Dollars in Millions, Except Per Share Amounts) Amount % of Net
Revenue		 Amount % of Net
Revenue		 Amount % of Net
Revenue		 Amount % of Net
Revenue
Net revenue $16,505
 100.0 % $16,962
 100.0 % $32,566
 100.0 % $33,028
 100.0%
Cost of sales 6,627
 40.2 % 6,543
 38.6 % 13,599
 41.8 % 12,878
 39.0%
Gross margin 9,878
 59.8 % 10,419
 61.4 % 18,967
 58.2 % 20,150
 61.0%
Research and development 3,438
 20.8 % 3,371
 19.9 % 6,770
 20.8 % 6,682
 20.2%
Marketing, general and administrative 1,589
 9.6 % 1,725
 10.2 % 3,122
 9.6 % 3,625
 11.0%
Restructuring and other charges 184
 1.1 % —
 — % 184
 0.6 % —
 —%
Amortization of acquisition-related intangibles 50
 0.3 % 50
 0.3 % 100
 0.3 % 100
 0.3%
Operating income 4,617
 28.0 % 5,273
 31.1 % 8,791
 27.0 % 9,743
 29.5%
Gains (losses) on equity investments, net 170
 1.0 % (203) (1.2)% 604
 1.9 % 440
 1.3%
Interest and other, net (63) (0.4)% 459
 2.7 % (124) (0.4)% 357
 1.1%
Income before taxes 4,724
 28.6 % 5,529
 32.6 % 9,271
 28.5 % 10,540
 31.9%
Provision for taxes 545
 3.3 % 523
 3.1 % 1,118
 3.4 % 1,080
 3.3%
Net income $4,179
 25.3 % $5,006
 29.5 % $8,153
 25.0 % $9,460
 28.6%
                 
Earnings per share – diluted $0.92
   $1.05
   $1.79
   $1.98
  

a002intellogofootera01.jpg
2019 Form 10-KOur Annual Report on Form 10-K for the fiscal year ended December 28, 2019
5GThe next-generation mobile network, which is expected to bring dramatic improvements in network speeds and latency, and which we view as a transformative technology and opportunity for many industries
ADASAdvanced driver-assistance systems
Adjacent productsAll of our non-platform products for CCG, DCG, and IOTG, such as modem, Ethernet and silicon photonics, as well as Mobileye, Non-Volatile Memory Solutions Group (NSG), and Programmable Solutions Group (PSG) products. Combined with our platform products, adjacent products form comprehensive platform solutions to meet customer needs
ASICApplication-specific integrated circuit
ASPAverage Selling Price
CODMChief operating decision maker
COVID-19The infectious disease caused by the most recently discovered coronavirus (aka SARS-CoV-2), which was declared a global pandemic by the World Health Organization
CPUProcessor or central processing unit
Data-centric businessesIncludes our Data Center Group (DCG), Internet of Things Group (IOTG), Mobileye, Non-Volatile Memory Solutions Group (NSG), Programmable Solutions Group (PSG), and all other businesses
ECEuropean Commission
EdgeAllocated resources that move, store, and process data closer to the source or point of service delivery
Form 10-QQuarterly Report on Form 10-Q
FPGAField-programmable gate array
IMFTIM Flash Technologies, LLC
Internet of ThingsRefers to the Internet of Things market in which we sell our IOTG and Mobileye products
IOTInternet of Things portfolio
IOTGInternet of Things Group operating segment
IPIntellectual property
MaaSMobility-as-a-Service
McAfeeBusiness, post divestiture of Intel Security Group in Q2 2017, which we retained an interest in as part of our investment strategy
MD&A  Consolidated ResultsManagement's Discussion & Analysis
21
MG&AMarketing, general and administrative
MoovitMoovit App Global Ltd, a MaaS solutions company acquired in Q2 2020
NANDNAND flash memory
nmNanometer
OEMOriginal equipment manufacturer
PC-centric businessOur Client Computing Group (CCG) business, including both platform and adjacent products
Platform products
A microprocessor (CPU) and chipset, a stand-alone SoC, or a multichip package, based on Intel® architecture. Platform products are primarily used in solutions sold through the CCG, DCG, and IOTG segments
QLCQuad-level cell
R&DResearch and development
RSURestricted stock unit
SECU.S. Securities and Exchange Commission
SoCSystem-on-Chip
SSDSolid-state drive
TLCTriple-level cell
U.S. GAAPU.S. Generally Accepted Accounting Principles

Table of Contents


REVENUE



intc-20200627_g15.jpgFINANCIAL STATEMENTS
SEGMENT REVENUE WALKS $B  Notes to Financial Statements
Q2 2019 vs. Q2 2018YTD 2019 vs. YTD 201827



c04yoyconsolrev.jpgTable of Contentsc05ytdconsolrevenue.jpg

Q2 2019 vs. Q2 2018
Our Q2 2019 revenue was $16.5 billion, down 3% from Q2 2018. The decrease in revenue was driven by our data-centric businesses, which were collectively down 7% as demand from enterprise and government data center customers weakened and NSG ASPs declined due to lower NAND market pricing. Revenue for our PC-centric business grew by 1% year over year, primarily driven by ASP strength in our commercial market segment, despite a decline in unit sales.
YTD 2019 vs. YTD 2018
Our YTD 2019 revenue was $32.6 billion, down $462 million, or 1% from YTD 2018. Our data-centric businesses were collectively down 6% as demand from enterprise and government data center customers weakened and NSG ASPs declined due to lower NAND market pricing. Revenue for our PC-centric business was up 3% in the first half of 2019 compared to the first half of 2018.


a002intellogofootera01.jpg  MD&AMANAGEMENT'S DISCUSSION AND ANALYSIS
  Consolidated Results & Analysis22


GROSS MARGIN
We derived most of our overall gross margin dollars from the sale of platform products in the CCG and DCG operating segments. Our overall gross margin dollars in Q2 2019 decreased by $541 million, or 5.2% compared to Q2 2018.
GROSS MARGIN $B
(PercentagesFor additional key highlights of our results of operations, see "A Quarter in chart indicate gross margin as a percentageReview" and "Our Pandemic Response."
DATA CENTER GROUP
DCG develops workload-optimized platforms for compute, storage, and network functions. Market segments include cloud service providers, enterprise and government, and communications service providers. We offer customers an unmatched, broad portfolio of total revenue)platforms and technologies designed to provide workload-optimized performance across compute, storage, and network. These offerings span the full spectrum from the data center core to the network edge.
c06yoyconsolgm.jpgc07ytdconsolgm.jpg
(In Millions)  
$9,878
 Q2 2019 Gross Margin
(370) Lower gross margin from platform revenue
(310) Lower gross margin from adjacent businesses primarily due to lower margins on NAND, modem, and PSG
145
 Lower period charges primarily due to lower factory start-up costs associated with our 10nm products
(6) Other
$10,419
 Q2 2018 Gross Margin
   
$18,967
 YTD 2019 Gross Margin
(385) Higher period charges primarily due to reserved non-qualified 10nm platform product in Q1 2019, offset by lower factory start-up costs associated with our 10nm products
(355) Lower gross margin from adjacent businesses due to lower NAND margins
(230) Lower gross margin from platform revenue
(195) Higher platform unit cost primarily from increased mix of performance products
(18) Other
$20,150
 YTD 2018 Gross Margin

a002intellogofootera01.jpg  MD&A
  Consolidated Results & Analysis23


OPERATING EXPENSES
Total research and development (R&D) and marketing, general and administrative (MG&A) expenses for Q2 2019 were $5.0 billion, down 1% from Q2 2018, and were $9.9 billion for YTD 2019, down 4% from YTD 2018. These expenses represent 30.5% of revenue for Q2 2019 and 30.0% of revenue for Q2 2018, and 30.4% of revenue in the first six months of 2019 and 31.2% of revenue in the first six months of 2018.
RESEARCH AND DEVELOPMENTDCG REVENUE $BMARKETING, GENERAL AND ADMINISTRATIVEDCG OPERATING INCOME $B
(Percentages indicate expenses as a percentage of total revenue)
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RESEARCH AND DEVELOPMENT
Q2 2019 – Q2 2018
R&D increased by $67 million, or 2.0%, driven by the following:
+    Investments in data-centric businesses
+    Investments in process technology
-    Profit dependent compensation due to a decrease in net income
-    Ramp down of 5G smartphone modem business
YTD 2019 – YTD 2018
R&D increased by $88 million, or 1.3%, driven by the following:
+    Investments in data-centric businesses
+    Investments in process technology
-    Corporate spending efficiencies
-    Profit dependent compensation due to a decrease in net income
-    Ramp downof 5G smartphone modem business
MARKETING, GENERAL AND ADMINISTRATIVE
Q2 2019 – Q2 2018
MG&A decreased by $136 million, or 7.9%, driven by the following:
-Corporate spending efficiencies
-    Profit dependent compensation due to a decrease in net income
-Lack of expenses due to the Wind River Systems, Inc. (Wind River) divestiture in Q2 2018
YTD 2019 – YTD 2018
MG&A decreased by $503 million, or 13.9%, driven by the following:
-Corporate spending efficiencies
-    Profit dependent compensation due to a decrease in net income
-Lack of expenses due to the Wind River divestiture in Q2 2018


a002intellogofootera01.jpg  MD&A
  Consolidated Results & Analysis24


CLIENT COMPUTING GROUP (CCG)
CCGis our largest business unit. The PC market remains a critical facet of our business, providing an important source of IP, scale, and cash flow. CCG is dedicated to delivering client computing end-user solutions, focusing on higher growth segments of 2-in-1, thin-and-light, commercial, and gaming, as well as growing adjacencies such as WiFi and Thunderbolt™ technology. CCG is the human edge in a data-centric world. We deploy platforms that connect people to data and analytics, allowing each person to focus, create, and connect in ways that unlock their individual potential.
We will be exiting the 5G smartphone modem business, while continuing to meet current customer commitments for our existing 4G smartphone modem product lines. We are assessing opportunities for 4G and 5G modems in PCs, as well as Internet of Things and other data-centric devices.
CCG REVENUE $BCCG OPERATING INCOME $B
c12ccgrevenue.jpgc13ccgopincome.jpg
■ Platform
■ Adjacent
REVENUE SUMMARY
Our revenueRevenue in Q2 20192020 was up 1%43% compared to Q2 2018, and2019, while YTD 20192020 was also up 3%43% compared to YTD 2018. Revenue2019, driven by increased volume, strong mix of platform products resulting in higher ASPs, and growth in adjacencies driven by 5G networking deployment. Year over year revenue in the cloud service providers market segment was up 47% as cloud service providers added capacity to serve demand. The enterprise and government market segment was up 34%, and the communications service providers market segment was up 44% year over yearyear.
We anticipate demand in the enterprise and yeargovernment market segment to date driven by ASP strength with richer commercialweaken in the second half of 2020 and demand in the cloud service providers market segment mix, modem growth, and tariff pull-ins, offset by platform volume decline as we experienced small core supply constraints.
to moderate later in the year.
  Q2 2019 vs. Q2 2018 YTD 2019 vs. YTD 2018
(Dollars in Millions) % $ Impact % $ Impact
           
Desktop platform volume down(11)% $(308) down(9)% $(525)
Desktop platform ASP up5% 121
 up6% 317
Notebook platform volume down(2)% (109) down(4)% (432)
Notebook platform ASP up3% 160
 up8% 720
Adjacent products and other    249
    399
           
Total change in revenue    $113
    $479
Q2 2020 vs. Q2 2019YTD 2020 vs. YTD 2019
(In Millions)%$ Impact%$ Impact
Platform volumeup29%$1,326  up28%$2,555  
Platform ASPup5%302  up9%1,018  
Adjacent productsup118%506  up77%652  
Total change in revenue$2,134  $4,225  
intc-20200627_g35.jpgMD&A
28
Table of Contents

OPERATING INCOME SUMMARY
Operating income in Q2 20192020 increased 16%72% from Q2 2018,2019, with an operating margin of 42%44%. Operating income YTD 20192020 increased 13% from YTD 2018,81%, with an operating margin of 39%47%.

(In Millions)
$3,099 Q2 2020 DCG Operating Income
1,450 Higher gross margin from platform revenue
100 Lower period charges, primarily associated with the initial ramp of 10nm
(110)Lower DCG adjacency gross margin
(105)Higher platform unit cost
a002intellogofootera01.jpg  MD&A
  Segment Results & Analysis25


(In Millions)  
$3,737
 Q2 2019 CCG Operating Income
400
 Lower period charges primarily due to lower factory start-up costs associated with our 10nm process technology
120
 Lower operating expenses partially driven by lower investment in modem
(17) Other
$3,234
 Q2 2018 CCG Operating Income
   
$6,809
 YTD 2019 CCG Operating Income
300
 Higher gross margin from platform revenue
285
 Lower operating expenses partially driven by lower investment in modem
130
 Lower period charges from factory start-up costs, offset by reserved non-qualified platform product associated with our 10nm process technology taken in Q1 2019
110
 Higher gross margin from adjacent businesses, primarily due to lack of initial production costs of modem products
(41) Other
$6,025
 YTD 2018 CCG Operating Income
DATA CENTER GROUP (DCG)
DCG develops workload-optimized platforms for compute, storage, and network functions. Customers include cloud service providers, enterprise and government, and communications service providers. DCG is fueled by demand in key workloads like artificial intelligence and network function virtualization across key market segments.
DCG REVENUE $BDCG OPERATING INCOME $B

c14dcgrevenue.jpgc15dcgopincome.jpg
■Platform
■Adjacent
REVENUE SUMMARY
Revenue decreased in Q2 2019 and in YTD 2019 due to a decline in platform volume. Cloud customers absorbed capacity, China demand weakened, and TAM contracted in the enterprise and government market segment. In Q2 2019, revenue in the enterprise and government segment was down 31%, cloud service providers segment was down 1%, and the communication service providers segment was up 3% year over year.
 Q2 2019 vs. Q2 2018 YTD 2019 vs. YTD 2018
(Dollars in Millions)% $ Impact % $ Impact
          
Platform volumedown(12)% $(627) down(10)% $(989)
Platform ASPup2% 80
 up1% 100
Adjacent productsdown(4)% (19) down(1)% (9)
          
Total change in revenue   $(566)    $(898)

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  Segment Results & Analysis26


(36)Other
OPERATING INCOME SUMMARY$1,800 Q2 2019 DCG Operating Income
Operating income in Q2 2019 decreased 34% from Q2 2018, with an operating margin of 36%. Operating income YTD 2019 decreased 32% from YTD 2018, with an operating margin of 37%.
(In Millions)  
$1,800
 Q2 2019 DCG Operating Income
(465) Lower gross margin from platform revenue
(240) Higher period charges, primarily associated with the initial ramp of 10nm
(205) Higher DCG operating expenses
(27) Other
$2,737
 Q2 2018 DCG Operating Income
   
$3,641
 YTD 2019 DCG Operating Income
(760) Lower gross margin from platform revenue
(470) Higher period charges, primarily associated with the initial ramp of 10nm
(375) Higher DCG operating expenses
(93) Other
$5,339
 YTD 2018 DCG Operating Income

$6,591 YTD 2020 DCG Operating Income
3,235 Higher gross margin from platform revenue
135 Lower period charges, primarily associated with the initial ramp of 10nm
(165)Lower DCG adjacency gross margin
(120)Higher platform unit cost
(75)Higher operating expenses
(60)Other
$3,641 YTD 2019 DCG Operating Income
intc-20200627_g36.jpgMD&A
  Segment Results & Analysis2729


INTERNET OF THINGS
As more intelligence is moving to the edge, more industries want to harnessare harnessing the power of data to create business value, to innovate, and to grow. We are using our architecture, accelerators, and software assets, combined with scale and partners, to develop a growing Internet of Things portfolio. Our Internet of Things portfolio is comprised of our IOTG and Mobileye businesses.
IOTG develops high-performance compute for targeted verticals and embedded markets. Our customers include retailers, manufacturers, health care providers, energy companies, automakers, and governments. We facilitate our customers creating, storing, and processing data generated by connected devices to accelerate business transformations.
Mobileye is the global leader in the developmentdriving assistance and automation solutions. Our product portfolio employs a broad set of technologies, covering computer vision and machine learning-based sensing, data analysis, localization, mapping, and driving policy technology for advanced driver assistance systems (ADAS)ADAS and autonomous driving. Mobileye’s advanced ADAS products form the building blocks for higher levels of autonomy that are being pursued by the automotive industry.autonomy. Our customers and strategic partners include major U.S.global OEMs and global Tier 1 automotive system integrators.
INTERNET OF THINGS REVENUE $BINTERNET OF THINGS OPERATING INCOME $B
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INTERNET OF THINGS REVENUE $BINTERNET OF THINGS OPERATING INCOME $B
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■ IOTG
■ Mobileye
■ IOTG
■ Mobileye
REVENUE AND OPERATING INCOME SUMMARY
Q2 2020 vs. Q2 2019
IOTG revenue was $670 million, down $316 million, driven by weaker demand for IOTG platform products in industrial, retail, and vision, primarily due to COVID-19. Demand was also negatively impacted by trade restrictions related to the U.S. government's Entity List publication. Operating income was $70 million, down $224 million year over year.
Mobileye revenue was $146 million, down $55 million, due to lower demand as a result of significant decline in global vehicle production related to COVID-19. Mobileye had an operating loss of $4 million, down $57 million from an operating income in 2019.
YTD 2020 vs. YTD 2019
IOTG revenue was $1.6 billion, down $343 million, driven by weaker demand for IOTG platform products in industrial, retail, and vision due to COVID-19. Demand was also negatively impacted by trade restrictions related to the U.S. government's Entity List publication, the effects of which are expected to continue in the second half of 2020. Operating income was $313 million, down $232 million compared to YTD 2019.
Mobileye revenue was $400 million, down $10 million, due to lower demand as a result of significant decline in global vehicle production related to COVID-19. Operating income was $84 million, down $37 million.
We expect continued negative COVID-19 related impacts on demand for our IOT portfolio in the second half of 2020.

Q2 2019 vs. Q2 2018
IOTG net revenue was $986 million, up $106 million, due to higher platform unit sales and higher ASPs from favorable core mix, partially offset by lower revenue from our divestiture of Wind River in Q2 2018, which negatively impacted the revenue comparison by approximately $80 million. After adjusting for the Wind River divestiture, IOTG revenue grew 23% year over year. Operating income was $294 million, up $51 million, primarily driven by higher platform revenue from core mix.
Mobileye net revenue was $201 million, up $28 million due to increasing adoption of ADAS. Operating income was $53 million, up $9 million.
YTD 2019 vs. YTD 2018
IOTG net revenue was $1.9 billion, up $176 million, due to $94 million higher platform unit sales and $158 million higher ASPs from favorable core mix, partially offset by lower revenue from our divestiture of Wind River in Q2 2018, which negatively impacted the revenue comparison by approximately $153 million year to date. After adjusting for the Wind River divestiture, IOTG revenue grew 21%. Operating income was $545 million, up $75 million, primarily driven by higher platform revenue from core mix.
Mobileye net revenue was $410 million, up $86 million due to increasing adoption of ADAS. Operating income was $121 million, up $67 million.


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  Segment Results & Analysis2830


NON-VOLATILE MEMORY SOLUTIONS GROUP (NSG)
NSG's core offerings include Intel® Optane™ and Intel® 3D NAND Technology, driving innovationNSG is a technology leader in SSDs and next-generation memory and storage products.products based on breakthrough Intel® Optane™ technology and Intel® 3D NAND technology. NSG is disrupting the memory and storage hierarchy with new tiers that balance capacity, performance, and cost. We offer 96-layer and 64-layer TLC NAND high-capacity SSDs, and 64-layer QLC NAND high-capacity SSDs. We also provide unparalleled low latency and high performance with Intel® Optane™ technology. Our products are available in innovative new form factors and densities to address the memory and storage challenges our customers face in a rapidly evolving technological landscape. Our customers include enterprise and cloud-based data centers, and users of business and consumer desktops and laptops. We are ramping 64-layer (64L) triple-level cell (TLC) and quad-level cell (QLC) NAND technologies, and Intel® Optane™ technology in innovative new form factors and densities to address the challenges our customers face in a rapidly evolving technological landscape.
NSG REVENUE $BNSG OPERATING INCOME $B
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REVENUE AND OPERATING INCOME SUMMARY
Q2 20192020 vs. Q2 20182019
NetNSG delivered record revenue was $940 million, down $139of $1.7 billion, up $719 million from Q2 2018,2019, driven by a $922 million impact from lower ASP due to lower NAND market pricing, offset by $783$379 million higher volume due to an increase instrong demand for componentNAND products and data center SSD products. NSG had$341 million higher ASPs from improved NAND pricing. Operating income was $322 million, up $606 million from an operating loss of $284 million in Q2 2019, due to continued improvements in unit cost, market pricing recovery, and strong demand.
YTD 2020 vs. YTD 2019
NSG delivered revenue of $3.0 billion, up $219 million$1.1 billion from Q2 2018. While we continued to see the ramp at Fab 68 drive cost improvements, the decline in ASP more than offset the improved unit cost, resulting in lower gross margins and higher period charges being taken against certain inventories.
YTD 2019, vs. YTD 2018
Net revenue was $1.9 billion, down $264 million, driven by a $1.6 billion impact from lower ASP due to lower NAND market pricing, offset by $1.3 billion$738 million higher volume due to an increase instrong demand for componentNAND products and data center SSD products. NSG had$405 million higher ASP from improved NAND pricing. Operating income was $256 million, up $837 million from an operating loss of $581 million, up $435 million. While wein YTD 2019, due to continued to see the ramp at Fab 68 drive cost improvements the decline in ASP more than offset the improved unit cost, resulting in lower gross marginsmarket pricing recovery, and higher period charges being taken against certain inventories.strong demand.


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  Segment Results & Analysis2931


PROGRAMMABLE SOLUTIONS GROUP (PSG)
PSG offers programmable semiconductors, primarily field-programmable gate array (FPGAs)FPGAs, structured ASICs, and related products, for a broad range of market segments, including communications, data center, industrial, and military. The PSG collaborates with the other Intel businesses to deliverproduct portfolio delivers FPGA acceleration in tandem with Intel microprocessors. This "better together" integration broadens the use of FPGAsmicroprocessors and combinesenables Intel to combine the benefits of bothits broad portfolio of technologies to allow more flexibility for systems to operate with increased efficiency and higher performance.
PSG REVENUE $BPSG OPERATING INCOME $B
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REVENUE AND OPERATING INCOME SUMMARY
Q2 20192020 vs. Q2 20182019
Revenue was $489$501 million, down $28up $12 million as softnessdue to growth in the cloud and enterprise demand more than offset growth in 5G/wireless. Advanced products (28nm, 20nm, and 14nm process technologies) grew 15% year over year. Operating income was $52 million, down $49 million.
YTD 2019 vs. YTD 2018
Revenue was $975 million, down $40 million, driven by a decline in our cloud and enterprisemarket segment, partially offset by weakness in the embedded and communications market segments. PSG experienced growth in advanced products. Operating income was $80 million, up $28 million.
YTD 2020 vs. YTD 2019
Revenue was $1.0 billion, up $45 million due to growth in the cloud and enterprise market segment, partially offset by weakness in the embedded and communications market segments. Operating income was $177 million, up $36 million.


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CLIENT COMPUTING GROUP
As we evolve to deliver leading end-to-end products across architectures and workloads for the data explosion, CCG’s contribution is the human touchpoint of this new data-centric era—the PC. As the largest business unit at Intel, CCG deploys platforms that connect people to data, allowing each person to focus, create, and engage in ways that unlock their individual potential. The PC market remains a critical facet of our business, providing an important source of IP, scale, and cash flow. Our mission is to continue to deliver leadership products in our PC business as well as our adjacent businesses. The PC is more essential than ever before with more people working and learning from home due to COVID-19-related impacts. We are dedicated to helping people around the world overcome this crisis.
CCG REVENUE $BCCG OPERATING INCOME $B
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■Platform
■Adjacent
REVENUE SUMMARY
Revenue in Q2 2020 was up 7% compared to Q2 2019, driven by strength in wirelessnotebook platform demand, strong ASP and advancedhigher LTE modem and Wi-Fi sales, partially offset by desktop demand. YTD 2020 up 11% compared to YTD 2019, driven by strong demand for notebook platform products (28nm, 20nm, and 14nm process technologies)higher LTE modem and Wi-Fi sales. Strength in notebook platform products reflects the increased reliance on PCs as more people are working and learning from home due to COVID-19.
While we expect notebook strength in Q3 2020, desktop demand is expected to remain weak in the second half of 2020 as a result of weaker global economic conditions due to COVID-19.
Q2 2020 vs. Q2 2019YTD 2020 vs. YTD 2019
(In Millions)%$ Impact%$ Impact
Desktop platform volumedown(14)%$(460) down(9)%$(607) 
Desktop platform ASPup3%61  up3%162  
Notebook platform volumeup9%434  up15%1,501  
Notebook platform ASPup5%274  up1%138  
Adjacent products and other346  650  
Total change in revenue$655  $1,844  










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OPERATING INCOME SUMMARY
Operating income in Q2 2020 decreased 24% from Q2 2019, with an operating margin of 30%. Operating income was $141 million, down $57 million.YTD 2020 increased 4%, with an operating margin of 37%.




(In Millions)
$2,842 Q2 2020 CCG Operating Income
(1,115)Higher platform unit cost due to ramp of 10nm products
(550)Higher period charges primarily due to reserved non-qualified platform product related to our 10nm process technology
325 Higher gross margin from platform revenue
285 Lower operating expenses driven by lower investment in modem
205 Higher CCG adjacency product margin
(45)Other
$3,737 Q2 2019 CCG Operating Income
$7,067 YTD 2020 CCG Operating Income
1,040 Higher gross margin from platform revenue
590 Lower operating expenses driven by lower investment in modem
265 Higher CCG adjacency product margin
(1,710)Higher platform unit cost due to ramp of 10nm products
73 Other
$6,809 YTD 2019 CCG Operating Income
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CONSOLIDATED RESULTS OF OPERATIONS
Three Months EndedSix Months Ended
Q2 2020Q2 2019YTD 2020YTD 2019
(In Millions, Except Per Share Amounts)Amount% of Net
Revenue		Amount% of Net
Revenue		Amount% of Net
Revenue		Amount% of Net
Revenue
Net revenue$19,728  100.0 %$16,505  100.0 %$39,556  100.0 %$32,566  100.0 %
Cost of sales9,221  46.7 %6,627  40.2 %17,033  43.1 %13,599  41.8 %
Gross margin10,507  53.3 %9,878  59.8 %22,523  56.9 %18,967  58.2 %
Research and development3,354  17.0 %3,438  20.8 %6,629  16.8 %6,770  20.8 %
Marketing, general and administrative1,447  7.3 %1,639  9.9 %2,988  7.6 %3,222  9.9 %
Restructuring and other charges9  — %184  1.1 %171  0.4 %184  0.6 %
Operating income5,697  28.9 %4,617  28.0 %12,735  32.2 %8,791  27.0 %
Gains (losses) on equity investments, net267  1.4 %170  1.0 %156  0.4 %604  1.9 %
Interest and other, net(29) (0.1)%(63) (0.4)%(342) (0.9)%(124) (0.4)%
Income before taxes5,935  30.1 %4,724  28.6 %12,549  31.7 %9,271  28.5 %
Provision for taxes830  4.2 %545  3.3 %1,783  4.5 %1,118  3.4 %
Net income$5,105  25.9 %$4,179  25.3 %$10,766  27.2 %$8,153  25.0 %
Earnings per share—diluted$1.19  $0.92  $2.50  $1.79  
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REVENUE
SEGMENT REVENUE WALK $B
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Q2 2020 vs. Q2 2019
Our Q2 2020 revenue was $19.7 billion, up $3.2 billion or 20% from Q2 2019. Compared to a year ago, our data-centric businesses were collectively up 34% as demand from data center customers continued to strengthen as cloud service providers increased capacity to serve customer demand. We also saw NSG bit growth and improved NAND pricing, partially offset by weaker demand in IOTG. Revenue in our PC-centric business was up 7% year over year driven by strength in notebook platform ASP and higher LTE modem and Wi-Fi sales.
YTD 2020 vs. YTD 2019
Our YTD 2020 revenue was $39.6 billion, up $7.0 billion or 21% from YTD 2019. Our data-centric businesses were collectively up 34% as demand from data center customers continued to strengthen as cloud service providers increased capacity to serve customer demand. We also saw NSG bit growth and improved NAND pricing, partially offset from weaker demand in IOTG. Our PC-centric business was up 11% year over year driven by strong demand for notebook platform products and higher LTE modem and Wi-Fi sales.



















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GROSS MARGIN
We derived most of our overall gross margin from the sale of platform products in the DCG and CCG operating segments. Our overall gross margin dollars in Q2 2020 increased by $629 million, or 6.4% compared to Q2 2019. Our gross margin percentage was down as the increase in platform revenue was offset by higher platform unit costs, platform reserves and a higher proportion of our revenue from lower margin adjacent businesses.
GROSS MARGIN $B
        (Percentages in chart indicate gross margin as a percentage of total revenue)
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(In Millions)
$10,507 Q2 2020 Gross Margin
1,550 Higher gross margin from platform revenue
815 Higher gross margin from adjacent businesses primarily due to higher margins on NAND and modem
(1,215)Higher platform unit cost primarily from increased mix of 10nm and performance products
(440)Higher period charges primarily due to reserved non-qualified platform product related to our 10nm process technology, partially offset by lower factory start-up costs associated with our 10nm products
(81)Other
$9,878 Q2 2019 Gross Margin
$22,523 YTD 2020 Gross Margin
4,025 Higher gross margin from platform revenue
1,150 Higher gross margin from adjacent businesses primarily due to higher margins on NAND and modem partially offset by lower margins on DCG adjacencies
320 Lower period charges primarily due to lower factory start-up costs associated with our 10nm products
(1,800)Higher platform unit cost primarily from increased mix of 10nm and performance products
(139)Other
$18,967 YTD 2019 Gross Margin
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OPERATING EXPENSES
Total R&D and MG&A expenses for Q2 2020 were $4.8 billion, down 5% from Q2 2019, and $9.6 billion for YTD 2020, down 4% from YTD 2019. These expenses represent 24.3% of revenue for Q2 2020 and 30.8% of revenue for Q2 2019, and 24.3% of revenue in the first six months of 2020 and 30.7% of revenue in the first six months of 2019.
RESEARCH AND DEVELOPMENT $BMARKETING, GENERAL AND ADMINISTRATIVE $B
(Percentages indicate expenses as a percentage of total revenue)
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RESEARCH AND DEVELOPMENT
Q2 2020 vs. Q2 2019
R&D decreased $84 million, or 2.4% driven by the following:
-Ramp down of 5G smartphone modem business
+Investments in our PC and data-centric businesses
+Investments in our process technology
+Profit dependent compensation
YTD 2020 vs. YTD 2019
R&D decreased by $141 million, or 2.1%, driven by the following:
-Ramp down of 5G smartphone modem business
+Investments in our PC and data-centric businesses
+Investments in our process technology
+Profit dependent compensation
MARKETING, GENERAL AND ADMINISTRATIVE
Q2 2020 vs. Q2 2019
MG&A decreased $192M, or 11.7%, driven by the following:
-Corporate spending efficiencies
+Profit dependent compensation
YTD 2020 vs. YTD 2019
MG&A decreased by $234 million, or 7.3%, driven by the following:
-Corporate spending efficiencies
+Profit dependent compensation
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GAINS (LOSSES) ON EQUITY INVESTMENTS AND INTEREST AND OTHER, NET
(In Millions) Q2 2019 Q2 2018 YTD 2019 YTD 2018(In Millions)Q2 2020Q2 2019YTD 2020YTD 2019
Ongoing mark-to-market adjustments on marketable equity securitiesOngoing mark-to-market adjustments on marketable equity securities$165  $(179) $62  $74  
Observable price adjustments on non-marketable equity securitiesObservable price adjustments on non-marketable equity securities58  8  137  16  
Impairment chargesImpairment charges(51) (39) (193) (62) 
Sale of equity investments and other
Sale of equity investments and other
95  380  150  576  
Gains (losses) on equity investments, net $170
 $(203) $604
 $440
Gains (losses) on equity investments, net$267  $170  $156  $604  
Interest and other, net $(63) $459
 $(124) $357
Interest and other, net$(29) $(63) $(342) $(124) 
Gains (losses) on equity investments, net
We recognized a net gain during Q2 2019 primarily due to a $340 million dividend from McAfee, Inc. (McAfee) but partially offset by ongoingOngoing mark-to-market losses of $179 million, primarily related to our investment in Cloudera, Inc. (Cloudera). We recognized a net gainadjustments during the first six months of 2019 primarily due to dividends of $494 million from McAfee and ongoing mark-to-market gains from ASML Holdings N.V. (ASML), partially offset by ongoing mark-to-market losses from Cloudera. We have fully sold our equity investment in ASML.
We recognized ongoing mark-to-market net losses on our marketable equity securities of $235 million in Q2 2018,2020 were primarily related to our interest in Cloudera andInc. (Cloudera). During the first six months of 2019, ongoing mark-to-market net gains of $371 millionadjustments were primarily driven by our interests in ASML Holdings N.V. and Cloudera.
We recognized higher than historically experienced impairment charges on our non-marketable portfolio in the first six months of 2018, primarily related to2020 based on our interests in ASML.assessment of the impact of recent public and private market volatility and tightening of liquidity.
We recognized McAfee dividends of $340 million during Q2 2019 and $494 million during the first six months of 2019.
Interest and other, net
For the six months ended June 27, 2020, we paid $1.1 billion to satisfy conversion obligations for $372 million of our $2.0 billion 2009 Debentures and recognized a loss of $109 million in interest and other, net and $750 million as a reduction in stockholders' equity related to the conversion feature. For the six months ended June 29, 2019, we paid $1.0 billion to satisfy conversion obligations for $400 million of our $2.0 billion 3.25% junior subordinated 2039 convertible debentures2009 Debentures and recognized a loss of $91 million in interest and other, net and $712 million as a reduction in stockholders' equity related to the conversion feature.
PROVISION FOR TAXES
(In Millions)Q2 2020Q2 2019YTD 2020YTD 2019
Income before taxes$5,935  $4,724  $12,549  $9,271  
Provision for taxes$830  $545  $1,783  $1,118  
Effective tax rate14.0 %11.5 %14.2 %12.1 %
For the six months ended June 30, 2018, we paid $1.2 billion to satisfy conversion obligations for $476 million of our $2.0 billion 3.25% junior subordinated 2039 convertible debentures and recognized a loss of $130 million in interest and other, net and $770 million as a reduction in stockholders' equity related to27, 2020, the conversion feature.
We recognized a net gain in Q2 2018 and for the first six months of 2018 primarily due to a $494 million gain on the divestiture of Wind River in Q2 2018.
PROVISION FOR TAXES
(Dollars in Millions) Q2 2019 Q2 2018 YTD 2019 YTD 2018
Income before taxes $4,724
 $5,529
 $9,271
 $10,540
Provision for taxes $545
 $523
 $1,118
 $1,080
Effective tax rate 11.5% 9.5% 12.1% 10.2%
The increase in effective tax rate was primarily driven by a lower U.S. tax benefit derived from sales to non-U.S. customers, a one-time benefits that occurredtax charge associated with a valuation allowance against a net operating loss deferred tax asset, and a one-time tax charge due to a new interpretation of a tax law in a non-U.S. jurisdiction.
In June 2020, the first six monthsU.S. Supreme Court declined to hear our appeal of 2018.

a ruling by the U.S. Court of Appeals for the Ninth Circuit regarding the treatment of stock-based compensation expense in an inter-company cost-sharing transaction for certain pre-acquisition Altera tax years. We expect to incur an immaterial tax liability which we have previously reserved.
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LIQUIDITY AND CAPITAL RESOURCES
We consider the following when assessing our liquidity and capital resources:
(Dollars in Millions) Jun 29,
2019		 Dec 29,
2018
(In Millions)(In Millions)Jun 27, 2020Dec 28, 2019
Cash and cash equivalents, short-term investments, and trading assets $11,944
 $11,650
Cash and cash equivalents, short-term investments, and trading assets$25,815  $13,123  
Other long-term investments $3,577
 $3,388
Other long-term investments$2,884  $3,276  
Loans receivable and other $1,691
 $1,550
Loans receivable and other$1,295  $1,239  
Reverse repurchase agreements with original maturities greater than three months $350
 $250
Reverse repurchase agreements with original maturities greater than three months$100  $350  
Total debt $28,815
 $26,359
Total debt$38,347  $29,001  
Temporary equity $247
 $419
Temporary equity$—  $155  
Debt as percentage of permanent stockholders’ equity 38.4% 35.4%
Cash generated by operations is our primary source of liquidity. When assessing our sources of liquidity, we include investments as shown in the preceding table. We maintain a diverse investment portfolio that we continually analyze based on issuer, industry, and country. When assessing our sources of liquidity, we include investments as shown in the preceding table. Substantially all of our investments in debt instruments and financing receivables are in investment-grade securities.
Other potential sources of liquidity include our commercial paper program and our automatic shelf registration statement on file with the SEC, pursuant to which we may offer an unspecified amount of debt, equity, and other securities. Under our commercial paper program, we have an ongoing authorization from our Board of Directors to borrow up to $10.0 billion. As of June 29, 2019, $1.5 billion of27, 2020, we had no outstanding commercial paper remained outstanding.paper.
We believe we have sufficient financial resources to meet our business requirements in the next 12 months, including capital expenditures for worldwide manufacturing and assembly and test; working capital requirements; and potential acquisitions, strategic investments, dividends, and commondividends. We have taken actions this year to further strengthen our liquidity. During the first six months of 2020, we issued a total of $10.3 billion aggregate principal amount of senior notes. Additionally, on March 24, 2020 we suspended the use of our financial resources for stock repurchases.repurchases, having repurchased approximately $7.6 billion of our planned $20.0 billionrepurchases announced in October 2019. Dividend payments to stockholders remain unaffected by the suspension of stock repurchases and the company intends to reinstate stock repurchases when market dynamics stabilize.
CASH FROM OPERATIONS $BCAPITAL EXPENDITURES $BCASH TO STOCKHOLDERS $B
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■ Dividends ■ Buybacks

Six Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019
Net cash provided by operating activities$17,315  $12,546  
Net cash used for investing activities(14,346) (6,010) 
Net cash provided by (used for) financing activities1,573  (6,688) 
Net increase (decrease) in cash and cash equivalents$4,542  $(152) 
  Six Months Ended
(In Millions) Jun 29,
2019		 Jun 30,
2018
Net cash provided by operating activities $12,546
 $13,697
Net cash used for investing activities (6,010) (5,984)
Net cash provided by (used for) financing activities (6,688) (8,532)
Net increase (decrease) in cash and cash equivalents $(152) $(819)
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Operating Activities
Cash provided by operating activities is net income adjusted for certain non-cash items and changes in assets and liabilities.

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For the first six months of 20192020 compared to the first six months of 2018,2019, the $1.2 billion decreaseincrease in cash provided by operations was primarily attributabledue to higher net income and changes in working capital and lower net income. Cash flow related tocapital. Changes in working capital was down as customers utilized supply agreement prepayments,were primarily driven by declines in inventory spending and as we continued to build inventory. These working capital changes were partiallya higher effective tax rate, offset by changes in income tax and other assets and liabilities balances.liabilities.
Investing Activities
Investing cash flows consist primarily of capital expenditures; investment purchases, sales, maturities, and disposals; and proceeds from divestitures and cash used for acquisitions.
Cash used for investing activities was flat forhigher in the first six months of 20192020 compared to the first six months of 2018. Trading asset activity was offset by2019 primarily due to increased purchases of available-for-sale debt investments and trading assets, and decreased sales of equity investments (substantially all from ASML sales) and reduced capital expenditures.investments.
Financing Activities
Financing cash flows consist primarily of repurchases of common stock, payment of dividends to stockholders, issuance and repayment of short-term and long-term debt, and proceeds from the sale of shares of common stock through employee equity incentive plans.
Cash was provided by financing activities in the first six months of 2020 compared to cash used for financing activities was lower in the first six months of 2019 comparedprimarily due to increased issuance of long-term debt, a reduction of repayments of debt and debt conversions, and a reduction in repurchases of common stock.
CONTRACTUAL OBLIGATIONS
In the first six months of 2018 due2020, we issued a total of $10.3 billion aggregate principal amount of senior notes. Our remaining total cash payments over the life of these long-term debt obligations are expected to collateral received for our fair value hedges associated with our senior notesbe approximately $19.1 billion. These payments include anticipated interest on fixed rate debt that is not recorded on the Consolidated Condensed Balance Sheets. For further information, see "Note 9: Borrowings" within the Consolidated Condensed Financial Statements and cash received from issuance of debt partially offset by repayment of commercial paper.Supplemental Details.
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are affected by changes in currency exchange and interest rates, as well as equity and commodity prices. For discussion about marketOur risk management programs are designed to reduce, but may not entirely eliminate, the impacts of these risks. We performed sensitivity analyses of these risks to our financial positions as of December 28, 2019, and updated that sensitivity analysis relatedas of June 27, 2020, to determine whether material changes in market risks pertaining to currency exchange rates,and interest rates or equity prices, and commodity prices refer tohave occurred as a result of the ongoing economic uncertainty resulting from the COVID-19 pandemic. No material revisions were noted since disclosing "Quantitative and Qualitative Disclosures About Market Risk" within "MDMD&A" in our Annual Report on2019 Form 10-K for the fiscal year ended December 29, 2018 (2018 Form 10-K).10-K.

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NON-GAAP FINANCIAL MEASURES
In addition to disclosing financial results in accordance with U.S. GAAP, this document contains references to the non-GAAP financial measures below. We believe these non-GAAP financial measures provide investors with useful supplemental information about our operating performance, enable comparison of financial trends and results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating our business and measuring our performance.
Our non-GAAP financial measures reflect adjustments based on one or more of the following items, as well as the related income tax effects where applicable. Income tax effects have been calculated using an appropriate tax rate for each adjustment. These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with U.S. GAAP, and the financial results calculated in accordance with U.S. GAAP and reconciliations from these results should be carefully evaluated.
Non-GAAP adjustment or measureDefinitionUsefulness to management and investors
Acquisition-related adjustmentsAmortization of acquisition-related intangible assets consists of amortization of intangible assets such as developed technology, brands, and customer relationships acquired in connection with business combinations. Charges related to the amortization of these intangibles are recorded within both cost of sales and MG&A in our U.S. GAAP financial statements. Amortization charges are recorded over the estimated useful life of the related acquired intangible asset, and thus are generally recorded over multiple years.We exclude amortization charges for our acquisition-related intangible assets for purposes of calculating certain non-GAAP measures because these charges are inconsistent in size and are significantly impacted by the timing and valuation of our acquisitions. These adjustments facilitate a useful evaluation of our current operating performance and comparison to our past operating performance and provide investors with additional means to evaluate cost and expense trends.
Restructuring and other chargesRestructuring charges are costs associated with a formal restructuring plan and are primarily related to employee severance and benefit arrangements. Other charges include asset impairments, pension charges, and costs associated with restructuring activity.We exclude restructuring and other charges, including any adjustments to charges recorded in prior periods, for purposes of calculating certain non-GAAP measures because these costs do not reflect our current operating performance and are significantly impacted by the timing of restructuring activity. These adjustments facilitate a useful evaluation of our current operating performance and comparisons to past operating results and provide investors with additional means to evaluate expense trends.
Ongoing mark-to-market on marketable equity securitiesAfter the initial mark-to-market adjustment is recorded upon a security becoming marketable, gains and losses are recognized from ongoing mark-to-market adjustments of our marketable equity securities.We exclude these ongoing gains and losses for purposes of calculating certain non-GAAP measures because we do not believe this volatility correlates to our core operational performance. These adjustments facilitate a useful evaluation of our current operating performance and comparisons to past operating results.
Free cash flowWe reference a non-GAAP financial measure of free cash flow, which is used by management when assessing our sources of liquidity, capital resources, and quality of earnings. Free cash flow is operating cash flow adjusted to exclude additions to property, plant, and equipment.This non-GAAP financial measure is helpful in understanding our capital requirements and provides an additional means to evaluate the cash flow trends of our business.

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Following are the reconciliations of our most comparable U.S. GAAP measures to our non-GAAP measures presented:
Three Months Ended
(In Millions, Except Per Share Amounts)Jun 27, 2020Jun 29, 2019
Operating income$5,697  $4,617  
Acquisition-related adjustments352  337  
Restructuring and other charges9  184  
Non-GAAP operating income$6,058  $5,138  
Operating margin28.9 %28.0 %
Acquisition-related adjustments1.8 %2.0 %
Restructuring and other charges— %1.1 %
Non-GAAP operating margin30.7 %31.1 %
Earnings per share—diluted$1.19  $0.92  
Acquisition-related adjustments0.08  0.08  
Restructuring and other charges—  0.04  
Ongoing mark-to-market on marketable equity securities(0.04) 0.04  
Income tax effect—  (0.02) 
Non-GAAP earnings per share—diluted$1.23  $1.06  
Six Months Ended
(In Millions)Jun 27, 2020Jun 29, 2019
Net cash provided by operating activities$17,315  $12,546  
Additions to property, plant and equipment(6,676) (6,875) 
Free cash flow$10,639  $5,671  
Net cash used for investing activities$(14,346) $(6,010) 
Net cash provided by (used for) financing activities$1,573  $(6,688) 
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OTHER KEY INFORMATION
RISK FACTORS
The risks described in "Risk Factors" within "OtherOther Key Information"Information in our 20182019 Form 10-K and our Form 10-Q for the quarter ended March 28, 2020 (Q1 2020 Form 10-Q) could materially and adversely affect our business, financial condition, and results of operations, and the trading price of our common stock could decline. The Risk Factors section in our 2019 Form 10-K, as updated by our Q1 2020 Form 10-Q and the discussions of the COVID-19 pandemic in this report, remains current in all material respects. These risk factors do not identify all risks that we face—our operations could also be affected by factors that are not presently known to us or that we currently consider to be immaterial to our operations. Due to risks and uncertainties, known and unknown, our past financial results may not be a reliable indicator of future performance and historical trends should not be used to anticipate results or trends in future periods. Below, we have updated
CONTROLS AND PROCEDURES
Inherent Limitations on Effectiveness of Controls
Our management, including the risk factor included inprincipal executive officer and principal financial officer, does not expect that our 2018 Form 10-K titled "Global or regional conditions may harm our financial results." The Risk Factors section in our 2018 Form 10-K otherwise remains current in all material respects.
Global or regional conditions may harm our financial results.We have manufacturing, assembly and test, R&D, sales, and other operations in many countries, and some of our business activities may be concentrated in one or more geographic areas. Moreover, sales outside the U.S. accounted for approximately 84% of our revenue for the fiscal year ended December 29, 2018, with revenue from billings to China, including Hong Kong, contributing approximately 27% of our total revenue. As a result, our operations and our financial results, including our ability to manufacture, assemble and test, design, develop, or sell products, and the demand for our products, may be adversely affected by a number of global and regional factors outside of our control.
Adverse changes in global or regional economic conditions, including recession or slowing growth, changes or uncertainty in fiscal or monetary policy, higher interest rates, tighter credit, inflation, lower capital expenditures by businesses including on IT infrastructure, increases in unemployment, and lower consumer confidence and spending, could significantly harm demand for our products and make it more challenging to forecast our operating results and make business decisions, including regarding prioritization of investments in our business. An economic downturn or increased uncertainty may also lead to increased credit and collectability risks, higher borrowing costs or limits on our access to capital markets, reduced liquidity, adverse impacts on our suppliers, failures of counterparties and other financial institutions, and declines in the value of our financial instruments.
International trade disputes may result in increased tariffs, trade barriers, and other protectionist measures that could increase our manufacturing costs, make our products less competitive, reduce demand for our products, limit our ability to procure components or raw materials, or impede or slow the movement of our goods across borders. Increasing protectionism and economic nationalism may lead to further changes in trade policy, domestic sourcing initiatives, or other formal and informal measures that could make it more difficult to sell our products in, or restrict our access to, some markets.
Escalating trade tensions between the U.S. and China have led to increased tariffs and trade restrictions, including tariffs applicable to some of our products. The U.S. has previously imposed, and continues to impose, restrictions on the export of U.S.-regulated products and technology to certain Chinese technology companies, which have included, and continue to include, certain of our customers. These restrictions have reduced our sales, and continuing or future restrictions could adversely affect our financial results, result in reputational harm to us due to our relationship with such companies, or lead such companies to develop or adopt technologies that compete with our products. It is difficult to predict what further trade-related actions governments may take, which may include additional or increased tariffs and trade restrictions, and we may be unable to quickly and effectively react to such actions.
Trade disputes and protectionist measures could result in declining consumer confidence and slowing economic growth or recession, and could cause our customers to reduce, cancel, or alter the timing of their purchases with us. Sustained trade tensions could lead to long-term changes in global trade and technology supply chains, which could adversely affect our business and growth prospects.
We may be adversely affected by other global and regional factors, including:
geopolitical and security issues, such as armed conflict and civil or military unrest, political instability, human rights concerns, and terrorist activity;
natural disasters, public health issues, and other catastrophic events;
inefficient infrastructure and other disruptions, such as supply chain interruptions and large-scale outages or unreliable provision of services from utilities, transportation, data hosting, or telecommunications providers;
formal or informal imposition of new or revised export, import, or doing-business regulations, including trade sanctions, tariffs, and changes in the ability to obtain export licenses, which could be changed without notice;
government restrictions on, or nationalization of, our operations in any country, or restrictions on our ability to repatriate earnings from a particular country;
differing employment practices and labor issues;
ineffective legal protection of our IP rights in certain countries;
local business and cultural factors that differ from our current standards and practices;
continuing uncertainty regarding social, political, immigration, and tax and trade policies in the U.S. and abroad, including as a result of the United Kingdom's vote to withdraw from the European Union; and
fluctuations in the market values of our domestic and international investments, which can be negatively affected by liquidity, credit deterioration or losses, interest rate changes, financial results, political risk, sovereign risk, or other factors.

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We are subject to laws and regulations worldwide that may differ among jurisdictions, affecting our operations in areas including, but not limited to: IP ownership and infringement; tax; import and export requirements; anti-corruption; foreign exchange controls and cash repatriation restrictions; data privacy requirements; competition; advertising; employment; product regulations; environment, health, and safety requirements; and consumer laws. Compliance with such requirements may be onerous and expensive, and may otherwise impact our business operations negatively. For example, unfavorable developments with evolving laws and regulations worldwide related to 5G or autonomous driving technology may limit global adoption, impede our strategy, and negatively impact our long-term expectations for our investments in these areas. Although we have policies,disclosure controls and procedures designed to help ensure compliance with applicable laws, thereor our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well-designed and operated, can be noprovide only reasonable, not absolute, assurance that our employees, contractors, suppliers, and/the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or agentsfraud will not violate such lawsoccur or our policies. Violationsthat all control issues and instances of these laws and regulations could result in fines; criminal sanctions against us, our officers, or our employees; prohibitions on the conduct of our business; and damage to our reputation.

CONTROLS AND PROCEDURESfraud, if any, have been detected.
Evaluation of Disclosure Controls and Procedures
Due to the COVID-19 pandemic, a significant portion of our employees are working from home. Established business continuity plans remain activated in order to mitigate the impact to our control environment, operating procedures, data and internal controls. The design of our processes and controls allow for remote execution with accessibility to secure data.
Based on management’s evaluation (with the participation of our principal executive officer and principal financial officer), as of the end of the period covered by this report, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the Exchange Act)), are effective to provide reasonable assurance that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting
There were no changes to our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during the quarter ended June 29, 201927, 2020 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Controls
Our management, including the principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well-designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected.
NON-GAAP FINANCIAL MEASURES
In addition to disclosing financial results in accordance with GAAP, this document contains references to the non-GAAP financial measures included in the table below. We believe these non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management in operating our business and measuring our performance.
Our non-GAAP operating income and diluted earnings per share reflect adjustments for one or more of the following items, as well as the related income tax effects. Income tax effects have been calculated using an appropriate tax rate for each adjustment. These non-GAAP financial measures should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations from these results should be carefully evaluated.
Amortization of acquisition-related intangible assets
Amortization of acquisition-related intangible assets consists of amortization of intangible assets such as developed technology, brands, and customer relationships acquired in connection with business combinations. We record charges related to the amortization of these intangibles within both cost of sales and operating expenses in our GAAP financial statements. Amortization charges for our acquisition-related intangible assets are inconsistent in size and are significantly impacted by the timing and valuation of our acquisitions, rather than our core operations. Consequently, our non-GAAP adjustments exclude these charges to facilitate an evaluation of our current operating performance and comparisons to our past operating performance.
Restructuring and other charges
Restructuring charges are costs associated with a formal restructuring plan and are primarily related to employee severance and benefit arrangements. Other charges include asset impairments. We exclude restructuring and other charges, including any adjustments to charges recorded in prior periods, for purposes of calculating certain non-GAAP measures. We believe that these costs do not reflect our current operating performance. Consequently, our non-GAAP adjustments exclude these charges to facilitate an evaluation of our current operating performance and comparisons to our past operating performance.

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Gains or losses from divestiture
We divested Wind River in Q2 2018 and recognized an associated gain. Our non-GAAP earnings per share figures exclude this impact to facilitate an evaluation of our current operating performance and comparisons to our past operating performance.
Ongoing mark-to-market on marketable equity securities
We exclude gains and losses resulting from ongoing mark-to-market adjustments of our marketable equity securities, after the initial mark-to-market adjustment is recorded upon a security becoming marketable, when calculating certain non-GAAP measures, as we do not believe this volatility correlates to our core operational performance. Consequently, our non-GAAP earnings per share figures exclude these impacts to facilitate an evaluation of our current operating performance and comparisons to our past operating performance.
Tax Reform adjustment
During Q2 2018, we made an adjustment to our U.S. Tax Cuts and Jobs Act (Tax Reform) provisional tax estimates that we recorded in Q4 2017. We exclude this provisional tax adjustment when calculating certain non-GAAP measures. We believe excluding this adjustment facilitates a better evaluation of our current operating performance and comparisons to past operating performance.
Following are the reconciliations of our most comparable GAAP measures to our non-GAAP measures presented:
  Three Months Ended
(In Millions, Except Per Share Amounts) Jun 29,
2019		 Jun 30,
2018
Operating income $4,617
 $5,273
Amortization of acquisition-related intangible assets 337
 325
Restructuring and other charges 184
 —
Non-GAAP operating income $5,138
 $5,598
Earnings per share - diluted $0.92
 $1.05
Amortization of acquisition-related intangible assets 0.08
 0.07
Restructuring and other charges 0.04
 —
(Gains) losses from divestiture —
 (0.10)
Ongoing mark-to-market on marketable equity securities 0.04
 0.05
Tax Reform —
 (0.04)
Income tax effect (0.02) 0.01
Non-GAAP earnings per share - diluted $1.06
 $1.04
ISSUER PURCHASES OF EQUITY SECURITIES
We have an ongoing authorization, originally approved by our Board of Directors in 2005 and subsequently amended, to repurchase shares of our common stock in open market or negotiated transactions. On March 24, 2020, we suspended stock repurchases in light of the COVID-19 pandemic and no shares were repurchased during the quarter ended June 27, 2020. We intend to reinstate repurchases when market dynamics stabilize. As of June 29, 2019,27, 2020, we were authorized to repurchase up to $90.0$110.0 billion, of which $11.7$19.7 billion remained available.
Common stock repurchase activity under our publicly announced stock repurchase program during the second quarter of 2019 was as follows:
Period Total Number
of Shares
Purchased
(In Millions)		 Average Price
Paid Per Share		 Dollar Value of
Shares That May
Yet Be Purchased
Under the Program
(In Millions)
March 31, 2019 - April 27, 2019 4.7
 $55.82
 $14,621
April 28, 2019 - May 25, 2019 28.3
 $46.27
 $13,311
May 26, 2019 - June 29, 2019 34.2
 $45.95
 $11,739
Total 67.2
 

  
We issue RSUs as part of our equity incentive plans. In our consolidated condensed financial statements,Consolidated Condensed Financial Statements, we treat shares of common stock withheld for tax purposes on behalf of our employees in connection with the vesting of RSUs as common stock repurchases because they reduce the number of shares that would have been issued upon vesting. These withheld shares of common stock are not considered common stock repurchases under our authorized common stock repurchase program and accordingly are not included in the common stock repurchase totals in the preceding table.

program.
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EXHIBITS
  Incorporated by Reference 
Exhibit
Number		Exhibit DescriptionFormFile NumberExhibitFiling
Date		Filed or
Furnished
Herewith
3.18-K000-062173.15/22/2006
3.28-K000-062173.21/17/2019
10.1†
X
31.1X
31.2X
32.1X
101.INSXBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL documentX
101.SCHXBRL Taxonomy Extension Schema DocumentX
101.CALXBRL Taxonomy Extension Calculation Linkbase DocumentX
101.DEFXBRL Taxonomy Extension Definition Linkbase DocumentX
101.LABXBRL Taxonomy Extension Label Linkbase DocumentX
101.PREXBRL Taxonomy Extension Presentation Linkbase DocumentX
104Cover Page Interactive Data File - formatted in Inline XBRL and included as Exhibit 101X
† Management contracts or compensation plans or arrangements in which directors or executive officers are eligible to participate.

    Incorporated by Reference  
Exhibit
Number
 Exhibit Description Form File Number Exhibit 
Filing
Date
 
Filed or
Furnished
Herewith
3.1 
Third Restated Certificate of Incorporation of Intel Corporation, dated May 17, 2006
 8-K 000-06217 3.1 5/22/2006  
3.2 
Intel Corporation Bylaws, as amended and restated on January 16, 2019
 8-K 000-06217 3.2 1/17/2019  
10.1† 
Intel Corporation 2006 Equity Incentive Plan, as amended and restated effective May 16, 2019
         X
10.2† 
Offer Letter between Intel Corporation and George S. Davis, dated April 2, 2019
 8-K 000-06217 10.1 4/3/2019  
31.1 
Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) of the Exchange Act
         X
31.2 
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) of the Exchange Act
         X
32.1 
Certification of the Chief Executive Officer and the Chief Financial Officer pursuant to Rule 13a-14(b) of the Exchange Act and 18 U.S.C. Section 1350
         X
101.INS XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.         X
101.SCH XBRL Taxonomy Extension Schema Document         X
101.CAL XBRL Taxonomy Extension Calculation Linkbase Document         X
101.DEF XBRL Taxonomy Extension Definition Linkbase Document         X
101.LAB XBRL Taxonomy Extension Label Linkbase Document         X
101.PRE XBRL Taxonomy Extension Presentation Linkbase Document         X
104 
Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

         X
†
Management contracts or compensation plans or arrangements in which directors or executive officers are eligible to participate.



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FORM 10-Q CROSS-REFERENCE INDEX
Item NumberItem
Part I - Financial Information
Item 1.Financial Statements
Pages 35 - 2027
Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations:
Results of operations
Pages 2, 21 - 314, 28 - 39
Liquidity and capital resources
Pages 3240 - 3341
Off-balance sheet arrangements(a)
Contractual obligations(b)
Page 41
Item 3.Quantitative and Qualitative Disclosures About Market Risk
Page 3341
Item 4.Controls and Procedures
Page 3544
Part II - Other Information
Item 1.Legal Proceedings
Pages 1823 - 2026
Item 1A.Risk Factors
PagesPage 3444 - 35
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
Page 3644
Item 3.Defaults Upon Senior SecuritiesNot applicable
Item 4.Mine Safety DisclosuresNot applicable
Item 5.Other InformationNot applicable
Item 6.Exhibits
Page 3745
Signatures
Page 39
(a)As of June 29, 2019, we did not have any significant off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K.
(b)There were no material changes to our significant contractual obligations from those disclosed in our Annual Report on Form 10-K for the year ended December 29, 2018.

Signatures
Page 47
(a) As of June 27, 2020, we did not have any significant off-balance sheet arrangements, as defined in Item 303(a)(4)(ii) of SEC Regulation S-K.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
INTEL CORPORATION
(Registrant)
Date:July 23, 2020INTEL CORPORATION
(Registrant)
By:
Date:July 25, 2019By:/s/ GEORGE S. DAVIS
George S. Davis
Executive Vice President, Chief Financial Officer and Principal Financial Officer
Date:July 25, 201923, 2020By:/s/ KEVIN T. MCBRIDE
Kevin T. McBride
Vice President of Finance, Corporate Controller and Principal Accounting Officer

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