Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 26, 2015 | Jul. 10, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ALTERA CORP | |
Entity Central Index Key | 768,251 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 26, 2015 | |
Amendment Flag | false | |
Document Fiscal Year | 2,015 | |
Document Fiscal Period | Q2 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 302,471,922 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 26, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 1,852,753 | $ 2,426,367 |
Short-term investments | 221,333 | 151,519 |
Total cash, cash equivalents, and short-term investments | 2,074,086 | 2,577,886 |
Accounts receivable, net | 424,427 | 377,964 |
Inventories | 177,654 | 153,387 |
Deferred income taxes — current | 58,645 | 56,048 |
Deferred compensation plan — marketable securities | 65,378 | 69,367 |
Deferred compensation plan — restricted cash equivalents | 14,484 | 14,412 |
Other current assets | 53,888 | 39,479 |
Total current assets | 2,868,562 | 3,288,543 |
Property and equipment, net | 210,980 | 194,840 |
Long-term investments | 2,448,942 | 1,942,343 |
Deferred income taxes — non-current | 18,669 | 20,077 |
Goodwill | 74,341 | 74,341 |
Acquisition-related intangible assets, net | 67,400 | 72,291 |
Other assets, net | 95,562 | 81,791 |
Total assets | 5,784,456 | 5,674,226 |
Current liabilities: | ||
Accounts payable | 51,618 | 49,140 |
Accrued liabilities | 44,421 | 28,384 |
Accrued compensation and related liabilities | 57,384 | 69,837 |
Deferred compensation plan obligations | 79,862 | 83,779 |
Deferred income and allowances on sales to distributors | 394,921 | 344,168 |
Total current liabilities | 628,206 | 575,308 |
Income taxes payable — non-current | 336,173 | 313,447 |
Long-term debt | 1,493,406 | 1,492,759 |
Other non-current liabilities | 6,878 | 6,886 |
Total liabilities | $ 2,464,663 | $ 2,388,400 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Common stock: $.001 par value; 1,000,000 shares authorized; outstanding - 302,467 shares at June 26, 2015 and 302,430 shares at December 31, 2014 | $ 302 | $ 302 |
Capital in excess of par value | 1,207,688 | 1,165,259 |
Retained earnings | 2,114,132 | 2,110,620 |
Accumulated other comprehensive (loss)/income | (2,329) | 9,645 |
Total stockholders' equity | 3,319,793 | 3,285,826 |
Total liabilities and stockholders' equity | $ 5,784,456 | $ 5,674,226 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Jun. 26, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common Stock, par value per share | $ 0.001 | $ 0.001 |
Common Stock, shares authorized | 1,000,000,000 | 1,000,000,000 |
Common Stock, shares outstanding | 302,467,000 | 302,430,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | |
Income Statement [Abstract] | ||||
Net sales | $ 414,162 | $ 491,517 | $ 849,647 | $ 952,609 |
Cost of sales | 126,590 | 162,391 | 282,853 | 314,259 |
Gross margin | 287,572 | 329,126 | 566,794 | 638,350 |
Research and development expense | 105,345 | 101,121 | 208,576 | 198,778 |
Selling, general, and administrative expense | 75,011 | 78,974 | 145,517 | 153,481 |
Amortization of acquisition-related intangible assets | 2,427 | 2,464 | 4,891 | 4,929 |
Merger expenses | 18,458 | 0 | 18,458 | 0 |
Compensation expense — deferred compensation plan | 2,732 | 3,126 | 2,759 | 4,580 |
Gain on deferred compensation plan securities | (2,732) | (3,126) | (2,759) | (4,580) |
Interest income and other | (8,495) | (7,819) | (15,091) | (13,804) |
Gain reclassified from other comprehensive income | (1,463) | (43) | (3,969) | (91) |
Interest expense | 10,859 | 10,877 | 21,267 | 21,365 |
Income before income taxes | 85,430 | 143,552 | 187,145 | 273,692 |
Income tax expense | 15,091 | 16,548 | 21,954 | 30,174 |
Net income | 70,339 | 127,004 | 165,191 | 243,518 |
Unrealized holding gain on investments: | ||||
Unrealized holding (loss)/gain on investments arising during period, net of tax of ($460), $23, ($419) and $46 | (24,805) | 14,471 | (8,020) | 27,031 |
Less: Reclassification adjustments for gain on investments included in net income, net of tax of $9, $6, $15 and $10 | (1,454) | (37) | (3,954) | (81) |
Other comprehensive (loss)/income | (26,259) | 14,434 | (11,974) | 26,950 |
Comprehensive income | $ 44,080 | $ 141,438 | $ 153,217 | $ 270,468 |
Net income per share (in dollars per share): | ||||
Basic (in dollars per share) | $ 0.23 | $ 0.41 | $ 0.55 | $ 0.78 |
Diluted (in dollars per share) | $ 0.23 | $ 0.41 | $ 0.54 | $ 0.77 |
Shares used in computing per share amounts (in shares): | ||||
Basic (in shares) | 301,799 | 311,000 | 301,561 | 313,713 |
Diluted (in shares) | 304,604 | 313,513 | 303,951 | 316,145 |
Dividends per common share | $ 0.18 | $ 0.15 | $ 0.36 | $ 0.30 |
Consolidated Statements of Com5
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | |
Income Statement [Abstract] | ||||
Tax on unrealized holding gain (loss) on investments arising during period | $ (460) | $ 23 | $ (419) | $ 46 |
Tax on reclassification adjustments for gain on investments included in net income | $ 9 | $ 6 | $ 15 | $ 10 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 26, 2015 | Jun. 27, 2014 | |
Cash Flows from Operating Activities: | ||
Net income | $ 165,191 | $ 243,518 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 27,981 | 28,731 |
Amortization of acquisition-related intangible assets | 4,891 | 4,929 |
Amortization of debt discount and debt issuance costs | 1,558 | 1,558 |
Stock-based compensation | 42,342 | 48,068 |
Net gain on sale of available-for-sale securities | (3,969) | (91) |
Amortization of investment discount/premium | 5,243 | 1,300 |
Deferred income tax expense | 1,770 | 1,573 |
Tax effect of employee stock plans | 2,776 | 121 |
Excess tax benefit from employee stock plans | (2,881) | (612) |
Changes in assets and liabilities: | ||
Accounts receivable, net | (46,463) | 30,473 |
Inventories | (24,267) | (12,848) |
Other assets | (9,990) | (2,751) |
Accounts payable and other liabilities | 6,558 | 5,703 |
Deferred income and allowances on sales to distributors | 50,753 | (72,547) |
Income taxes payable and receivable, net | 11,036 | 30,592 |
Deferred compensation plan obligations | (6,676) | (6,329) |
Net cash provided by operating activities | 225,853 | 301,388 |
Cash Flows from Investing Activities: | ||
Purchases of property and equipment | (43,339) | (21,614) |
Sales of deferred compensation plan securities, net | 6,676 | 6,329 |
Purchases of available-for-sale securities | (1,298,609) | (204,810) |
Proceeds from sale of available-for-sale securities | 634,838 | 58,015 |
Proceeds from maturity of available-for-sale securities | 69,711 | 134,212 |
Purchases of intangible assets | (5,257) | (535) |
Purchases of other investments | (2,000) | (8,224) |
Net cash used in investing activities | (637,980) | (36,627) |
Cash Flows from Financing Activities: | ||
Proceeds from issuance of common stock through stock plans | 18,709 | 22,696 |
Shares withheld for employee taxes | (17,125) | (11,240) |
Payment of dividends to stockholders | (108,445) | (94,179) |
Holdback payment for prior acquisition | 0 | (3,353) |
Long-term debt and credit facility issuance costs | 0 | (1,321) |
Repurchases of common stock | (57,507) | (358,808) |
Excess tax benefit from employee stock plans | 2,881 | 612 |
Net cash used in financing activities | (161,487) | (445,593) |
Net decrease in cash and cash equivalents | (573,614) | (180,832) |
Cash and cash equivalents at beginning of period | 2,426,367 | 2,869,158 |
Cash and cash equivalents at end of period | $ 1,852,753 | $ 2,688,326 |
Organization and Basis of Prese
Organization and Basis of Presentation | 6 Months Ended |
Jun. 26, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation The accompanying unaudited consolidated financial statements of Altera Corporation and its subsidiaries, collectively referred to herein as “Altera”, “we”, “us”, or “our”, have been prepared by us in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. This financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair statement of the results for the periods presented. The December 31, 2014 consolidated balance sheet data was derived from our audited consolidated financial statements included in our 2014 Annual Report on Form 10-K, as filed with the Securities and Exchange Commission (“SEC”), but does not include all disclosures required by U.S. GAAP. The consolidated financial statements include our accounts as well as those of our wholly-owned subsidiaries after elimination of all significant inter-company balances and transactions. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in our consolidated financial statements and accompanying notes. Actual results could differ materially from those estimates. These consolidated financial statements should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2014 included in our Annual Report on Form 10-K. The consolidated operating results for the three months and six months ended June 26, 2015 are not necessarily indicative of the results to be expected for any future period. Certain prior year amounts in the consolidated financial statements and the notes thereto have been reclassified to conform to the current year presentation. These reclassifications did not affect the prior period total assets, total liabilities, stockholders' equity, net income or net cash provided by operating activities. Pending Merger with Intel Corporation On May 31, 2015, Altera Corporation entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Intel Corporation (“Intel”) and 615 Corporation, a wholly owned subsidiary of Intel (“Merger Sub”). The Merger Agreement provides for the merger of Merger Sub with and into Altera (the “Merger”), with Altera surviving the Merger as a wholly owned subsidiary of Intel. At the effective time of the Merger, each share of common stock issued and outstanding immediately prior to the effective time (other than shares held by (1) Intel, Altera or their respective subsidiaries; or (2) stockholders who have properly exercised and perfected appraisal rights under Delaware law) will be cancelled and extinguished and automatically converted into the right to receive cash in an amount equal to $54.00 , without interest thereon (the “Per Share Amount”). In addition, subject to certain exceptions, unvested option awards, restricted stock unit awards and performance-based restricted stock unit awards will be converted into corresponding awards of Intel common stock pursuant to an exchange ratio determined based on Intel’s stock price at closing, with generally the same terms and conditions applicable to the original awards. The consummation of the merger is conditioned on the receipt of the approval of Altera's stockholders, as well as the satisfaction of other customary closing conditions, including domestic and foreign regulatory approvals and performance in all material respects by each party of its obligations under the Merger Agreement. The Merger is currently expected to close within six to nine months of June 1, 2015. The Merger is not conditioned upon Intel’s receipt of financing. The Merger Agreement contains certain termination rights for Altera and Intel, including if a governmental body prohibits the Merger or if the Merger is not consummated before May 31, 2016, subject to certain extension rights. Upon termination of the Merger Agreement under specified circumstances, Altera or Intel will be required to pay the other party a termination fee of $500 million . In certain other circumstances, Altera will be required to reimburse Intel’s expenses up to $60 million if the Merger Agreement is terminated. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 6 Months Ended |
Jun. 26, 2015 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued a new financial accounting standard on revenue from contracts with customers, Accounting Standards Update ("ASU") No. 2014-09, " Revenue from Contracts with Customers ". The standard outlines a single comprehensive model for companies to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. In July 2015, the FASB voted to defer the effective date by one year to December 15, 2017 for interim and annual reporting periods beginning after that date and permitted early adoption of the standard, but not before the original effective date of December 15, 2016. We are currently evaluating the impact of this accounting standard on our consolidated financial statements. In February 2015, the FASB issued ASU 2015-02, " Consolidation: Amendments to the Consolidation Analysis ". This standard update is intended to improve targeted areas of consolidation guidance for reporting organizations that are required to evaluate whether they should consolidate certain legal entities. This ASU simplifies consolidation accounting by reducing the number of consolidation models and improves current U.S. GAAP by (1) placing more emphasis on risk of loss when determining a controlling financial interest; (2) reducing the frequency of the application of related-party guidance when determining a controlling financial interest in a variable interest entity; and (3) changing consolidation conclusions for public and private companies in several industries that typically make use of limited partnerships or variable interest entities. The amendments in this ASU are effective for reporting periods beginning after December 15, 2015, with early adoption permitted. Entities can transition to the standard either retrospectively or as a cumulative effect adjustment as of the date of adoption. The adoption of ASU 2015-02 is not expected to have an impact on our consolidated financial statements. In April 2015, the FASB issued ASU 2015-03, " Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs ". This standard update requires an entity to present debt issuance costs on the balance sheet as a direct deduction from the related debt liability as opposed to an asset. Amortization of the costs will continue to be reported as interest expense. The update is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued, and the new guidance would be applied retrospectively to all prior periods presented. The adoption of this standard update is not expected to have a material impact on our consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-05, “ Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement" . This standard update provides clarification on whether a cloud computing arrangement includes a software license. If a software license is included, the customer should account for the license consistent with its accounting of other software licenses. If a software license is not included, the arrangement should be accounted for as a service contract. The update is effective for reporting periods beginning after December 15, 2015, with early adoption permitted. Entities can elect to adopt the standard update prospectively or retrospectively to arrangements entered into, or materially modified, after the effective date. The adoption of this standard update is not expected to have a material impact on our consolidated financial statements. |
Acquisition-Related Intangible
Acquisition-Related Intangible Assets, Net | 6 Months Ended |
Jun. 26, 2015 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Acquisition-Related Intangible Assets, Net | Acquisition-Related Intangible Assets, Net Acquisition-related intangible assets, net were as follows: June 26, 2015 (In thousands) Gross Assets Accumulated Amortization Net Weighted-Average Amortization Period Developed technology $ 67,670 $ (15,189 ) $ 52,481 9.4 years Customer relationships 12,910 (4,442 ) 8,468 6.8 years Trade name 3,700 (877 ) 2,823 8.9 years Non-competition agreements 700 (700 ) — 2.0 years Other intangible assets 930 (802 ) 128 1.2 years Acquisition-related intangible assets, net subject to amortization 85,910 (22,010 ) 63,900 In-process research & development 3,500 — 3,500 Total acquisition-related intangible assets, net $ 89,410 $ (22,010 ) $ 67,400 December 31, 2014 (In thousands) Gross Assets Accumulated Amortization Net Weighted-Average Amortization Period Developed technology $ 67,670 $ (11,607 ) $ 56,063 9.4 years Customer relationships 12,910 (3,493 ) 9,417 6.8 years Trade name 3,700 (670 ) 3,030 8.9 years Non-competition agreements 700 (563 ) 137 2.0 years Other intangible assets 930 (786 ) 144 1.2 years Acquisition-related intangible assets subject to amortization, net 85,910 (17,119 ) 68,791 In-process research & development 3,500 — 3,500 Total acquisition-related intangible assets, net $ 89,410 $ (17,119 ) $ 72,291 In-process research & development ("IPR&D") assets represent the fair value of incomplete research and development projects that had not reached technological feasibility as of the date of acquisition. In 2013, we capitalized IPR&D of $28.1 million related to two acquisitions. Initially, these assets are classified as indefinite-lived intangible assets that are not subject to amortization. IPR&D assets related to projects that have been completed are transferred to the developed technology intangible asset to begin amortization, while IPR&D assets related to abandoned projects are impaired and expensed to Research and development expense in the consolidated statements of comprehensive income. No projects were abandoned in 2014 or 2015. The remaining IPR&D project as of June 26, 2015 is expected to be completed in the fourth quarter of 2015. Based on the carrying value of Acquisition-related intangible assets, net as of June 26, 2015 , the annual amortization expense for Acquisition-related intangible assets, net is expected to be as follows: Fiscal Year Amortization Expense (In thousands) 2015 (remaining six months) $ 4,755 2016 9,327 2017 9,151 2018 9,039 2019 8,938 2020 and Thereafter 22,690 Total $ 63,900 |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 26, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Financial Instruments | Financial Instruments Cash, Cash Equivalents and Marketable Securities The following tables summarize our cash and available-for-sale securities by significant investment category. June 26, 2015 (In thousands) Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Marketable Securities Long-Term Marketable Securities Cash $ 71,407 $ — $ — $ 71,407 $ 71,407 $ — $ — Available-for-sale: Level 1: Money market funds 1,773,821 — — 1,773,821 1,773,821 — — U.S. treasury securities 1,016,744 4,786 (268 ) 1,021,262 5,725 79,653 935,884 Subtotal 2,790,565 4,786 (268 ) 2,795,083 1,779,546 79,653 935,884 Level 2: U.S. agency securities 31,432 9 (30 ) 31,411 — 7,495 23,916 Non-U.S. government securities 47,888 13 (38 ) 47,863 — 11,474 36,389 Municipal bonds 3,507 1 (5 ) 3,503 2,001 1,502 Corporate debt securities 1,580,979 939 (8,157 ) 1,573,761 1,800 120,710 1,451,251 Subtotal 1,663,806 962 (8,230 ) 1,656,538 1,800 141,680 1,513,058 Total $ 4,525,778 $ 5,748 $ (8,498 ) $ 4,523,028 $ 1,852,753 $ 221,333 $ 2,448,942 December 31, 2014 (In thousands) Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Marketable Securities Long-Term Marketable Securities Cash $ 57,505 $ — $ — $ 57,505 $ 57,505 $ — $ — Available-for-sale: Level 1: Money market funds 2,366,799 — — 2,366,799 2,366,799 — — U.S. treasury securities 1,338,162 12,721 (2,302 ) 1,348,581 500 38,938 1,309,143 Subtotal 3,704,961 12,721 (2,302 ) 3,715,380 2,367,299 38,938 1,309,143 Level 2: U.S. agency securities 21,186 12 (7 ) 21,191 — 11,748 9,443 Non-U.S. government securities 31,281 2 (17 ) 31,266 — 19,459 11,807 Municipal bonds 2,000 2 — 2,002 — 1,001 1,001 Corporate debt securities 693,638 362 (1,115 ) 692,885 1,563 80,373 610,949 Subtotal 748,105 378 (1,139 ) 747,344 1,563 112,581 633,200 Total $ 4,510,571 $ 13,099 $ (3,441 ) $ 4,520,229 $ 2,426,367 $ 151,519 $ 1,942,343 As of June 26, 2015 , we had cost method investments of approximately $24.6 million . These investments are included within Other assets, net on our consolidated balance sheets. The investments are non-marketable equity investments in privately held companies in which we have less than a 20% interest and no significant influence over the investee's operations. We report these investments at cost, except when investments are found to be other-than-temporarily impaired after an impairment review. We did not recognize any impairment losses for 2015 or 2014. The adjusted cost and estimated fair value of marketable debt securities (corporate debt securities, municipal bonds, U.S. and foreign government securities, and U.S. treasury securities) as of June 26, 2015 , by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations without call or prepayment penalties. June 26, 2015 (In thousands) Cost Estimated Fair Value Due in one year or less $ 228,777 $ 228,858 Due after one year through five years 2,046,919 2,043,059 Due between six and ten years 404,854 405,883 $ 2,680,550 $ 2,677,800 As of June 26, 2015 , we had $1.3 billion in available-for-sale securities in our investment portfolio that were in a continuous unrealized loss position for less than 12 months with a gross unrealized loss of $8.5 million . As of December 31, 2014 , we had $1.1 billion in available-for-sale securities in our investment portfolio that were in a continuous unrealized loss position for less than 12 months with a gross unrealized loss of $3.4 million . We concluded that the declines in market value of our available-for-sale securities investment portfolio were temporary in nature and did not consider any of our investments to be other-than-temporarily impaired. |
Accounts Receivable, Net and Si
Accounts Receivable, Net and Significant Customers | 6 Months Ended |
Jun. 26, 2015 | |
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |
Accounts Receivable, Net and Significant Customers | Accounts Receivable, Net and Significant Customers Accounts receivable, net consisted of the following: (In thousands) June 26, December 31, Gross accounts receivable $ 424,927 $ 380,442 Allowance for doubtful accounts (500 ) (500 ) Allowance for sales returns — (1,978 ) Accounts receivable, net $ 424,427 $ 377,964 We sell our products to original equipment manufacturers ("OEMs") and to electronic components distributors who resell these products to OEMs, or their contract manufacturers. Net sales by customer type and net sales to significant customers were as follows: Three Months Ended Six Months Ended (Percentage of Net Sales) June 26, June 27, June 26, 2015 June 27, 2014 Sales to distributors 85 % 72 % 79 % 73 % Sales to OEMs 15 % 28 % 21 % 27 % 100 % 100 % 100 % 100 % Significant Distributors (1) : Arrow Electronics, Inc. ( “Arrow”) 45 % 38 % 43 % 38 % Macnica, Inc. (“Macnica”) 27 % 23 % 24 % 23 % (1) Except as presented above, no other distributor accounted for greater than 10% of our net sales for the three months and six months ended June 26, 2015 or June 27, 2014 . No individual OEM accounted for more than 10% of our net sales for the quarterly or year-to-date periods ended June 26, 2015 . One OEM accounted for 11% of our net sales for both the quarterly and year-to-date periods ended June 27, 2014 . No other individual OEM accounted for more 10% of our net sales for the quarterly or year-to-date periods ended June 27, 2014 . As of June 26, 2015 , accounts receivable from Arrow and Macnica individually accounted for approximately 30% and 57% , respectively, of our total accounts receivable. As of December 31, 2014 , accounts receivable from Arrow and Macnica individually accounted for approximately 34% and 47% , respectively, of our total accounts receivable. No other distributor or OEM accounted for more than 10% of our accounts receivable as of June 26, 2015 or December 31, 2014 . |
Inventories
Inventories | 6 Months Ended |
Jun. 26, 2015 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following: (In thousands) June 26, December 31, Raw materials $ 6,856 $ 6,826 Work in process 124,226 95,675 Finished goods 46,572 50,886 Total inventories $ 177,654 $ 153,387 |
Deferred Income and Allowances
Deferred Income and Allowances on Sales to Distributors | 6 Months Ended |
Jun. 26, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Deferred Income and Allowances on Sales to Distributors | Deferred Income and Allowances on Sales to Distributors Deferred income and allowances on sales to distributors consisted of the following: (In thousands) June 26, December 31, Deferred revenue on shipment to distributors $ 421,174 $ 369,560 Deferred cost of sales on shipment to distributors (32,113 ) (32,172 ) Deferred income on shipment to distributors 389,061 337,388 Other deferred revenue (1) 5,860 6,780 Total $ 394,921 $ 344,168 (1) Principally represents revenue deferred on our maintenance contracts, software and intellectual property licenses. The Deferred income and allowances on sales to distributors activity was as follows: Six Months Ended (In thousands) June 26, June 27, Balance at beginning of period $ 344,168 $ 487,746 Deferred revenue recognized upon shipment to distributors 3,031,752 2,853,749 Deferred cost of sales recognized upon shipment to distributors (143,573 ) (134,974 ) Revenue recognized upon sell-through to end customers (535,018 ) (559,914 ) Cost of sales recognized upon sell-through to end customers 142,606 133,531 Earned distributor price concessions (1) (2,422,463 ) (2,329,017 ) Returns (21,671 ) (35,866 ) Other (880 ) (56 ) Balance at end of period $ 394,921 $ 415,199 (1) Average aggregate price concessions typically range from 70% to 85% of our list price on an annual basis, depending upon the composition of our sales, volumes and factors associated with timing of shipments to distributors. We sell the majority of our products to distributors worldwide at a list price. However, distributors resell our products to end customers at a very broad range of individually negotiated prices based on a variety of factors, including customer, product, quantity, geography and competitive differentiation. The majority of our distributors' sales to their customers are priced at a discount from our list price. Under these circumstances, we remit back to the distributor a portion of its original purchase price after the resale transaction is completed, and we validate the distributor's resale information, including end customer, device, quantity and price, against the distributor price concession that we have approved in advance. To receive a price concession, a distributor must submit the price concession claim to us for approval within 60 days of the resale of the product to an end customer. It is our practice to apply these negotiated price discounts to future purchases, requiring the distributor to settle receivable balances, on a current basis, generally within 30 days, for amounts originally invoiced. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss)/Income | 6 Months Ended |
Jun. 26, 2015 | |
Equity [Abstract] | |
Accumulated Other Comprehensive Income | Accumulated Other Comprehensive (Loss)/Income Accumulated other comprehensive (loss)/income on our consolidated balance sheets as of June 26, 2015 and December 31, 2014 consisted of accumulated unrealized (loss)/gain on available-for-sale securities, net of tax. As of June 26, 2015 , accumulated unrecognized loss on available-for-sale securities, net of tax, was $2.3 million . As of December 31, 2014 , accumulated unrecognized gain on available-for-sale securities, net of tax, was $9.6 million . |
Net Income Per Share
Net Income Per Share | 6 Months Ended |
Jun. 26, 2015 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Net Income Per Share A reconciliation of basic and diluted Net income per share is presented below: Three Months Ended Six Months Ended (In thousands, except per share amounts) June 26, June 27, June 26, June 27, Basic: Net income $ 70,339 $ 127,004 $ 165,191 $ 243,518 Basic weighted shares outstanding 301,799 311,000 301,561 313,713 Net income per share $ 0.23 $ 0.41 $ 0.55 $ 0.78 Diluted: Net income $ 70,339 $ 127,004 $ 165,191 $ 243,518 Weighted shares outstanding 301,799 311,000 301,561 313,713 Effect of dilutive securities: Stock options, employee stock purchase plan, and restricted stock unit shares 2,805 2,513 2,390 2,432 Diluted weighted shares outstanding 304,604 313,513 303,951 316,145 Net income per share $ 0.23 $ 0.41 $ 0.54 $ 0.77 In applying the treasury stock method, we excluded 0.1 million and 0.7 million stock option shares and restricted stock unit shares (including performance-based restricted stock unit shares) for the three and six months ended June 26, 2015 , respectively, and 2.2 million and 2.0 million stock option shares and restricted stock unit shares (including performance-based restricted stock unit shares) for the three and six months ended June 27, 2014 , respectively, because their effect was anti-dilutive. |
Credit Facility and Long-Term D
Credit Facility and Long-Term Debt | 6 Months Ended |
Jun. 26, 2015 | |
Debt Disclosure [Abstract] | |
Credit Facility and Long-Term Debt | Credit Facility and Long-Term Debt Credit Facility In 2012, we entered into a five -year $250 million unsecured revolving credit facility (the "Facility"). Under certain circumstances, upon our request and with the consent of the lenders, the commitments under the Facility may be increased up to an additional $250 million . Borrowings under the Facility will bear interest at a base rate determined in accordance with the Facility, plus an applicable margin based upon the debt rating of our non-credit enhanced, senior unsecured long-term debt. In addition, we are obligated to pay a quarterly commitment fee, payable in arrears, based on the available commitments. This Facility fee varies and is also determined based on our debt rating. The terms of the Facility require compliance with certain financial and non-financial covenants, which we had satisfied as of June 26, 2015 . As of June 26, 2015 , we had not borrowed any funds under the Facility. Long-term Debt The carrying values and associated effective interest rates for our Long-term debt were as follows: (In thousands, except rates) Effective Interest Rate June 26, 2015 December 31, 2014 2013 Senior Notes due November 15, 2018 at 2.50% 2.71% $ 597,876 $ 597,557 2013 Senior Notes due November 15, 2023 at 4.10% 4.29% 395,810 395,559 2012 Senior Notes due May 15, 2017 at 1.75% 1.94% 499,720 499,643 Total long-term debt $ 1,493,406 $ 1,492,759 In 2013, we issued $600 million aggregate principal amount of 2.50% senior notes (the “2.50% Notes”) and $400 million aggregate principal amount of 4.10% senior notes (the “4.10% Notes”) for stock repurchase and general corporate purposes. We received net proceeds of $991.8 million , after deduction of a discount of $8.2 million , and we capitalized direct debt issuance costs of $5.5 million from issuance of the 2.50% Notes and the 4.10% Notes. In 2012, we issued $500 million aggregate principal amount of 1.75% senior notes (the "1.75% Notes") to repay our outstanding credit facility. We received net proceeds of $499.2 million , after deduction of a discount of $0.8 million , and we capitalized direct debt issuance costs of $3.7 million from issuance of the 1.75% Notes. All three of our senior notes (the “Notes”) pay a fixed rate of interest semiannually on May 15 and November 15 of each year. The Notes are governed by a base and supplemental indenture between Altera and U.S. Bank National Association, as trustee. The Notes are unsecured and unsubordinated obligations, ranking equally in right of payment to all of our existing and future unsecured and unsubordinated indebtedness and senior in right of payment to any of our future indebtedness that is expressly subordinated to the Notes. The indentures governing the Notes contain certain covenants that limit our ability to create liens on certain assets to secure debt, to enter into sale and lease-back transactions, and to consolidate, merge, sell or otherwise dispose of all or substantially all of our assets. As of June 26, 2015, we have satisfied all of our covenants contained in the indentures governing the Notes. Furthermore, we may redeem or be required to redeem the Notes, in whole or in part, for cash at the redemption prices described in the indentures. Upon the occurrence of certain events, which constitute a change in control triggering event as defined in the indentures, each holder of the Notes may require us to repurchase for cash all or a portion of such holder’s notes at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest. The Merger that was announced on June 1, 2015 does not constitute a change in control triggering event that would require us to redeem the Notes. The direct debt issuance costs associated with the Notes are recorded in Other assets, net in our consolidated balance sheets and are being amortized to Interest expense in our consolidated statements of comprehensive income over the contractual term using the effective interest method. The carrying values of the Notes are reflected in our consolidated balance sheets as follows: 2.50% Notes 4.10% Notes 1.75% Notes (In thousands) June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 Principal amount $ 600,000 $ 600,000 $ 400,000 $ 400,000 $ 500,000 $ 500,000 Unamortized discount (2,124 ) (2,443 ) (4,190 ) (4,441 ) (280 ) (357 ) Net carrying value $ 597,876 $ 597,557 $ 395,810 $ 395,559 $ 499,720 $ 499,643 Interest expense related to the Notes is included in Interest expense in the consolidated statements of comprehensive income as follows: Three Months Ended Six Months Ended (In thousands) June 26, 2015 June 27, 2014 June 26, 2015 June 27, 2014 Contractual coupon interest $ 10,016 $ 10,015 $ 19,554 $ 19,667 Amortization of debt issuance costs 455 456 911 911 Amortization of debt discount 324 323 647 647 Total interest expense related to the Notes $ 10,795 $ 10,794 $ 21,112 $ 21,225 The other component of Interest expense in our consolidated statements of comprehensive income is interest expense related to bank service fees incurred in connection with our credit facility. As of June 26, 2015 , future principal payments for the Notes were as follows: Fiscal Year Payable (In thousands) 2015 (remaining six months) $ — 2016 — 2017 500,000 2018 600,000 2019 — 2020 and after 400,000 Total $ 1,500,000 The Notes are measured at fair value on a quarterly basis for disclosure purposes. Our Notes are classified within Level 1 of the fair value hierarchy and the estimated fair value of the Notes is based on quoted market prices. The estimated fair value of the Notes is as follows: 2.50% Notes 4.10% Notes 1.75% Notes (In thousands) June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 Estimated fair value $ 610,440 $ 606,564 $ 416,400 $ 417,480 $ 502,320 $ 501,460 |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 26, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Indemnification and Product Warranty We indemnify certain customers, distributors, suppliers, and subcontractors for attorney's fees and damages and costs awarded against these parties in certain circumstances in which our products are alleged to infringe third party intellectual property rights, including patents, trade secrets, trademarks or copyrights. We cannot estimate the amount of potential future payments, if any, that we might be required to make as a result of these agreements. To date, we have not paid any claims nor have we been required to defend any action related to our indemnification obligations, and, accordingly, we have not accrued any amounts for such indemnification obligations. However, we may record charges in the future as a result of these indemnification obligations. We generally warrant our devices for one year against defects in materials, workmanship and material non-conformance to our specifications. We accrue for known warranty issues if a loss is probable and can be reasonably estimated, and accrue for estimated but unidentified issues based on historical activity. If there is a material increase in customer claims compared with our historical experience or if the costs of servicing warranty claims are greater than expected, we may record a charge against cost of sales. Warranty expense was not significant for any period presented in our consolidated statements of comprehensive income. Purchase Obligations We depend entirely upon subcontractors to manufacture our silicon wafers and provide assembly and test services. Due to lengthy subcontractor lead times, we must order these materials and services from these subcontractors well in advance, and we are obligated to pay for the materials and services once they are completed. As of June 26, 2015 , we had approximately $141.5 million of outstanding purchase commitments to such subcontractors. We expect to receive and pay for these materials and services over the next twelve months. Operating Leases We lease facilities and equipment under non-cancelable lease agreements expiring at various times through 2020 and beyond. There have been no significant changes to our operating lease obligations since December 31, 2014 . Other Commitments As of June 26, 2015 , we had $11.7 million of outstanding non-cancelable license obligations to providers of electronic design automation software remaining to be paid in equal quarterly installments through December 2017. Legal Proceedings In connection with entering into the Merger Agreement, six putative class action lawsuits have been filed by purported Altera stockholders in the Court of Chancery of the State of Delaware against our board of directors, Intel, Merger Sub, and, in some cases, Altera. The actions are captioned Sciabucchi v. Daane et al. , Case No. 11108-VCG; Goldstein v. Daane et al. , Case No. 11126-VCG; Reinauer v. Altera et al. , Case No. 11144-VCG; Braunstein v. Daane et al. , Case No. 11146-VGC; Litwin v. Daane et al. , Case No. 11160-VCG; and Robinson v. Daane et al. , Case No. 11165-VCG. On June 26, 2015, these actions were consolidated as In re Altera Corp. Shareholder Litigation, Case No. 11108-VCG. The complaints allege, among other things, that members of our board of directors breached their fiduciary duties to Altera stockholders by agreeing to a transaction that does not adequately reflect Altera’s true value, and that Intel, Merger Sub, and/or Altera aided and abetted the board of directors' breaches of fiduciary duties. The complaints seek to enjoin the Merger or, alternatively, seek rescission of the Merger or an award of rescissory damages. On July 17, 2014, PLL Technologies, Inc. ("PTI") filed a patent infringement lawsuit against Altera and three additional defendants in the United States District Court for the District of Delaware seeking unspecified damages, interest, costs, and fees. On October 1, 2014, PTI amended its complaint, and on October 20, 2014, Altera answered the complaint, denying the patents are valid and denying infringement. In May 2015, PTI and Altera entered into a settlement agreement, which included a dismissal of all PTI's claims against Altera and a dismissal of Altera's counterclaims against PTI. The resolution of this case did not have a material adverse impact on our consolidated operating results or financial position. On June 20, 2014, Altera filed an action in the United States District Court for the Northern District of California against PACT XPP Technologies, AG (“PACT”), for a declaratory judgment of non-infringement and invalidity relating to several patents that PACT has asserted against us. On October 8, 2014, PACT answered the complaint and asserted counterclaims that Altera infringes various patents owned by PACT. Because the case is at an early stage, we cannot determine at this time whether any loss has been incurred by Altera nor can we reasonably estimate any potential loss or range of potential loss. We file income tax returns with the Internal Revenue Service (“IRS”) and in various United States ("U.S.") states and foreign jurisdictions. On December 8, 2011 and January 23, 2012, the IRS issued Statutory Notices of Deficiency (the “Notices”) determining, respectively, additional taxes for 2002 through 2004 of $19.8 million and additional taxes for 2005 through 2007 of $21.4 million , excluding interest. The IRS’s determinations relate primarily to inter-company transactions, computational adjustments to the R&D credit and reductions to the benefits of tax credit carry backs and carry forwards. We deposited $18.0 million as a cash bond with the IRS in 2008, and converted this amount to tax payments in March 2012. On March 6, 2012 and April 20, 2012, we filed petitions challenging the Notices in the U.S. Tax Court. The petitions request redetermination of the deficiencies produced by the IRS’s adjustments. The IRS filed responses to our petitions, in which the IRS conceded the R&D credit adjustment for 2004. The Tax Court consolidated the two cases and a judge was assigned. The federal statute of limitations for the 2002 and 2003 tax years expired, and the ongoing Tax Court litigation concerns only the 2004 through 2007 years. On January 31, 2013, the IRS conceded one of the adjustments at issue in the litigation for the 2004 through 2007 tax years. The conceded adjustment related to certain inter-company services transactions. The concession only impacted our 2007 tax year. As a result of this concession, we recognized a tax and interest benefit of $6.8 million in 2013 due to the release of certain tax reserves. Altera and the IRS filed cross motions for partial summary judgment on the largest adjustment still at issue, which is related to the treatment of stock-based compensation in an inter-company cost-sharing transaction. As part of the partial motion for summary judgment process, both sides filed briefs on May 28, 2013, July 25, 2013 and September 9, 2013. We expect to present additional legal arguments related to certain affirmative adjustments raised by Altera in the litigation. The parties have filed a series of Joint Status Reports with the court addressing these affirmative adjustments. The parties presented oral arguments on the partial summary judgment issue to the Tax Court on July 24, 2014 and we are awaiting a ruling. We believe we have made adequate tax payments or accrued adequate amounts for our tax liabilities for 2004 through 2007 and that the outcome of the above matters will not have a material adverse effect on our consolidated operating results or financial position. |
Stock-Based Compensation
Stock-Based Compensation | 6 Months Ended |
Jun. 26, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | Stock-Based Compensation Stock-based compensation expense included in our consolidated statements of comprehensive income was as follows: Three Months Ended Six Months Ended (In thousands) June 26, June 27, June 26, June 27, Cost of sales $ 440 $ 495 $ 847 $ 961 Research and development expense 9,670 10,877 18,613 21,150 Selling, general, and administrative expense 11,907 13,349 22,882 25,957 Pre-tax stock-based compensation expense 22,017 24,721 42,342 48,068 Less: income tax benefit (6,115 ) (6,651 ) (11,736 ) (12,845 ) Net stock-based compensation expense $ 15,902 $ 18,070 $ 30,606 $ 35,223 No stock-based compensation was capitalized during any period presented above. As of June 26, 2015 , unrecognized stock-based compensation cost related to outstanding unvested stock options, restricted stock units ("RSU"s), performance-based restricted stock units ("PRSU"s) and employee stock purchase plan ("ESPP") shares was approximately $151.0 million . This unrecognized stock-based compensation cost is expected to be recognized over a weighted average period of approximately 2.3 years. We apply an expected forfeiture rate when amortizing stock-based compensation expense. To the extent our actual forfeiture rate is different from our estimate, stock-based compensation related to these awards will be different from our expectations. The assumptions used to estimate the fair value of the RSU awards granted under our stock-based compensation plans were as follows: Three Months Ended Six Months Ended June 26, June 27, June 26, June 27, ESPP Purchase Rights: Expected term (in years) 0.8 1.0 0.8 1.0 Expected stock price volatility 41.8 % 25.5 % 41.8 % 25.5 % Risk-free interest rate 0.1 % 0.1 % 0.1 % 0.1 % Dividend yield 1.6 % 1.9 % 1.6 % 1.9 % Weighted-average estimated fair value $ 12.90 $ 7.68 $ 12.90 $ 7.68 RSUs: Risk-free interest rate 0.8 % 0.7 % 0.8 % 0.7 % Dividend yield 1.6 % 1.9 % 1.6 % 1.9 % Weighted-average estimated fair value $ 43.24 $ 31.01 $ 42.63 $ 30.97 PRSUs: Expected Altera stock price volatility 30.0 % 32.2 % 30.0 % 32.2 % Expected Philadelphia Semiconductor Index stock price volatility 19.7 % 24.3 % 19.7 % 24.3 % Risk-free interest rate 1.0 % 0.9 % 1.0 % 0.9 % Dividend yield 1.6 % 1.9 % 1.6 % 1.9 % Weighted-average estimated fair value per share $ 58.02 $ 31.18 $ 58.02 $ 31.18 We granted 187,604 , 303,260 , 262,647 and 66,489 market-based PRSUs in 2015 , 2014 , 2013 and 2012 , respectively, to senior executives with vesting that is contingent on both the market performance of Altera stock as compared to the Philadelphia Semiconductor Index during a 3-year measurement period and continued service. As of June 26, 2015 , the majority of these market-based PRSUs were still outstanding, and no market-based PRSUs had vested. For market-based PRSU grants made on May 4, 2015, May 13, 2014, May 5, 2014, May 6, 2013 and July 30, 2012, the weighted average grant date fair value was $58.02 , $31.13 , $31.23 , $33.03 and $41.18 , respectively. A summary of activity for our RSUs and PRSUs for the six months ended June 26, 2015 and information regarding RSUs and PRSUs outstanding and expected to vest as of June 26, 2015 is as follows: (In thousands, except per share amounts and terms) Number of Shares Weighted-Average Grant-Date Fair Market Value Per Share Weighted-Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (1) Outstanding, December 31, 2014 5,506 $ 34.00 Grants 1,843 $ 44.45 Vested (1,353 ) $ 34.18 Forfeited/Cancelled (188 ) $ 35.24 Outstanding, June 26, 2015 5,808 $ 37.24 1.6 $ 297,945 Vested and expected to vest, June 26, 2015 5,094 $ 37.24 1.5 $ 261,331 (1) Aggregate intrinsic value represents the closing price per share of our stock on June 26, 2015 , multiplied by the number of RSUs and market-based PRSUs outstanding or vested and expected to vest as of June 26, 2015 . A summary of stock option activity for the six months ended June 26, 2015 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of June 26, 2015 is as follows: (In thousands, except per share amounts and terms) Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (1) Outstanding, December 31, 2014 2,074 $ 32.60 Grants — $ — Exercises (344 ) $ 23.57 Forfeited/Cancelled/Expired (19 ) $ 30.46 Outstanding, June 26, 2015 1,711 $ 34.45 5.2 $ 28,838 Exercisable, June 26, 2015 1,403 $ 34.10 4.9 $ 24,129 Vested and expected to vest, June 26, 2015 1,696 $ 34.45 5.2 $ 28,583 (1) For those stock options with an exercise price below the closing price per share on June 26, 2015 , aggregate intrinsic value represents the difference between the exercise price and the closing price per share of our common stock on June 26, 2015 , multiplied by the number of stock options outstanding, exercisable, or vested and expected to vest as of June 26, 2015 . For the three and six months ended June 26, 2015 , 0.2 million and 0.3 million of non-qualified stock option shares were exercised, respectively. The total intrinsic value of stock options exercised for the three and six months ended June 26, 2015 was $5.1 million and $6.8 million , respectively. The aggregate intrinsic value represents the difference between the exercise price and the selling price received by option holders upon the exercise of stock options during the period. The total consideration recorded as a result of stock option exercises during the three and six months ended June 26, 2015 was $6.0 million and $8.1 million , respectively. As of June 26, 2015 , our 2005 Equity Incentive Plan had a total of 25.0 million shares reserved for future issuance, of which 16.7 million shares were available for future grants. ESPP We sold 386,613 shares of common stock under the ESPP at a price of $27.41 during the six months ended June 26, 2015 and 376,031 shares of common stock under the ESPP at a price of $27.61 during the six months ended June 27, 2014 . As of June 26, 2015 , 4.0 million shares were available for future issuance under the ESPP. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 26, 2015 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity We repurchase shares under our stock repurchase program announced on July 15, 1996, which has no specified expiration. No existing repurchase plans or programs have expired, nor have we decided to terminate any repurchase plans or programs prior to expiration. There were 233.0 million shares authorized for repurchase with approximately 16.0 million shares remaining for further repurchases under our stock repurchase program as of June 26, 2015 . Since the inception of the stock repurchase program through June 26, 2015 , we have repurchased a total of 217.0 million shares of our common stock for an aggregate cost of $5.0 billion . In connection with the Merger Agreement, we have suspended our share repurchase program. During the six months ended June 26, 2015 , we repurchased 1.6 million shares of our common stock for a total of $57.5 million under our stock repurchase program at an average price per share of $34.95 . During the six months ended June 27, 2014 , we repurchased 10.6 million shares of our common stock for a total of $358.8 million under our stock repurchase program at an average price per share of $33.90 . All shares were retired upon acquisition and have been recorded as a reduction of Common stock , Capital in excess of par value and Retained earnings, as applicable. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 26, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We file income tax returns with the IRS and in various U.S. states and foreign jurisdictions. On December 8, 2011 and January 23, 2012, the IRS issued Statutory Notices of Deficiency (the “Notices”) determining, respectively, additional taxes for 2002 through 2004 of $19.8 million and additional taxes for 2005 through 2007 of $21.4 million , excluding interest. The IRS’s determinations relate primarily to inter-company transactions, computational adjustments to the R&D credit and reductions to the benefits of tax credit carry backs and carry forwards. We deposited $18.0 million as a cash bond with the IRS in 2008, and converted this amount to tax payments in March 2012. On March 6, 2012 and April 20, 2012, we filed petitions challenging the Notices in the U.S. Tax Court. The petitions request redetermination of the deficiencies produced by the IRS’s adjustments. The IRS filed responses to our petitions, in which the IRS conceded the R&D credit adjustment for 2004. The Tax Court consolidated the two cases and a judge was assigned. The federal statute of limitations for the 2002 and 2003 tax years expired, and the ongoing Tax Court litigation concerns only the 2004 through 2007 years. On January 31, 2013, the IRS conceded one of the adjustments at issue in the litigation for the 2004 through 2007 tax years. The conceded adjustment related to certain inter-company services transactions. The concession only impacted our 2007 tax year. As a result of this concession, we recognized a tax and interest benefit of $6.8 million in 2013 due to the release of certain tax reserves. Altera and the IRS have filed cross motions for partial summary judgment on the largest adjustment still at issue, which is related to the treatment of stock-based compensation in an inter-company cost-sharing transaction. As part of the partial motion for summary judgment process, both sides filed briefs on May 28, 2013, July 25, 2013 and September 9, 2013. We expect to present additional legal arguments related to certain affirmative adjustments raised by Altera in the litigation. The parties have filed a series of Joint Status Reports with the court addressing these affirmative adjustments. The parties presented oral arguments on the partial summary judgment issue to the Tax Court on July 24, 2014 and we are awaiting a ruling. We believe we have made adequate tax payments or accrued adequate amounts for our tax liabilities for 2004 through 2007 and that the outcome of the above matters will not have a material adverse effect on our consolidated operating results or financial position. The IRS is currently examining our 2010 and 2011 tax years. We believe we have made adequate tax payments or accrued adequate amounts for our tax liabilities for these years and that the outcome of the audit will not have a material adverse effect on our consolidated operating results or financial position. Other significant jurisdictions in which we are or may be subject to examination for fiscal years 2002 forward include China (including Hong Kong), Denmark, Ireland, Malaysia, Japan, Canada, United Kingdom and the state of California. We believe we have made adequate tax payments and/or accrued adequate amounts such that the outcome of these audits will have no material adverse effect on our consolidated operating results. Due to the potential resolution of various tax examinations, and the expiration of various statutes of limitations, it is possible that our gross unrecognized tax benefits may change within the next twelve months. However, given the number of years remaining subject to examination and the number of matters being examined, we are unable to estimate the full range of potential adjustments to the balance of gross unrecognized tax benefits. Our effective tax rate reflects the impact of a significant amount of our earnings being taxed in foreign jurisdictions at rates substantially below the U.S. statutory tax rate. Our effective tax rate for the three months ended June 26, 2015 was 17.7% compared with 11.5% for the three months ended June 27, 2014 . The increase in our effective tax rate was primarily due to a combination of adverse geographic mix of earnings and the non-deductible portion of merger-related expenses in 2015 compared with the same period in 2014. During the three months ended June 26, 2015 , we recognized a net benefit of $4.2 million related to the deductible portion of merger-related expenses. Our effective tax rate for the six months ended June 26, 2015 was 11.7% compared with 11.0% for the six months ended June 27, 2014 . The net change in our effective tax rate was primarily due to adverse geographic mix of earnings and the non-deductible portion of merger-related expenses offset by higher one-time tax benefits in 2015 compared with the same period in 2014. During the six months ended June 26, 2015 , we recognized one-time benefits of $4.2 million related to the deductible portion of merger-related expenses and $7.1 million related to foreign tax credits earned in excess of a foreign dividend, which were offset by $1.2 million of true-up adjustments resulting from the filing of tax returns in foreign jurisdictions. During the six months ended June 27, 2014 , we reversed $4.0 million of liabilities and the related interest for uncertain tax positions upon the expiration of a domestic statute of limitations, which was offset by $0.9 million of true-up adjustments resulting from the filing of tax returns in foreign jurisdictions. As of June 26, 2015 , we had total gross unrecognized tax benefits of $362.6 million which, if recognized, would potentially impact our effective tax rate. As of December 31, 2014 , we had total gross unrecognized tax benefits of $341.1 million . We are unable to make a reasonable estimate as to if and when cash settlements with the relevant taxing authorities may occur. We recognize interest and penalties related to uncertain tax positions in our income tax provision. We have accrued approximately $49.5 million and $45.8 million for interest and penalties related to uncertain tax positions as of June 26, 2015 and December 31, 2014 , respectively. |
Non-Qualified Deferred Compensa
Non-Qualified Deferred Compensation Plan | 6 Months Ended |
Jun. 26, 2015 | |
Non Qualified Deferred Compensation Plan [Abstract] | |
Non-Qualified Deferred Compensation Plan | Non-Qualified Deferred Compensation Plan We allow our U.S.-based officers and director-level employees to defer a portion of their compensation under the Altera Corporation Non-Qualified Deferred Compensation Plan (the “NQDC Plan”). Our Retirement Plans Committee administers the NQDC Plan. As of June 26, 2015 , there were 131 participants in the NQDC Plan who self-direct their investments, subject to certain limitations. In the event we become insolvent, the NQDC Plan assets are subject to the claims of our general creditors. Since the inception of the NQDC Plan, we have not made any contributions to the NQDC Plan, and we have no commitments to do so in the future. There are no NQDC Plan provisions that provide for any guarantees or minimum return on investments. NQDC Plan participants are prohibited from investing NQDC Plan contributions in Altera common stock. The balance of the NQDC Plan assets and related obligations was $79.9 million and $83.8 million as of June 26, 2015 and December 31, 2014 , respectively. Investment income or loss from the NQDC Plan is recorded as Gain on deferred compensation plan securities in our consolidated statements of comprehensive income. The investment (gain)/loss also represents an (increase)/decrease in the future payout to participants and is recorded as Compensation expense — deferred compensation plan in our consolidated statements of comprehensive income. Compensation expense/(benefit) associated with our NQDC Plan obligations is offset by the (gain)/loss from the related securities. The net effect of investment income or loss and related compensation expense or benefit has no impact on our income before income taxes, net income or cash balances. The following tables summarize the fair value of our NQDC Plan assets by significant investment category: (In thousands) June 26, 2015 December 31, 2014 Deferred compensation plan assets: (1) Level 1: Restricted cash equivalents $ 14,484 $ 14,412 Equity securities 30,766 33,521 Mutual funds 32,790 33,764 Subtotal 78,040 81,697 Level 2: Fixed income securities 1,822 2,082 Total $ 79,862 $ 83,779 (1) Included in Deferred compensation plan — marketable securities and Deferred compensation plan — restricted cash equivalents in the accompanying consolidated balance sheets as of June 26, 2015 and December 31, 2014 . |
Declaration of Dividend Subsequ
Declaration of Dividend Subsequent to June 26, 2015 | 6 Months Ended |
Jun. 26, 2015 | |
Subsequent Events [Abstract] | |
Declaration of Dividend Subsequent to June 26, 2015 | Declaration of Dividend Subsequent to June 26, 2015 On July 20, 2015 , our board of directors declared a cash dividend of $0.18 per common share payable on September 1, 2015 to stockholders of record on August 10, 2015 . |
Acquisition-Related Intangibl23
Acquisition-Related Intangible Assets, Net (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Acquired Intangible Asset by Major Class | Acquisition-related intangible assets, net were as follows: June 26, 2015 (In thousands) Gross Assets Accumulated Amortization Net Weighted-Average Amortization Period Developed technology $ 67,670 $ (15,189 ) $ 52,481 9.4 years Customer relationships 12,910 (4,442 ) 8,468 6.8 years Trade name 3,700 (877 ) 2,823 8.9 years Non-competition agreements 700 (700 ) — 2.0 years Other intangible assets 930 (802 ) 128 1.2 years Acquisition-related intangible assets, net subject to amortization 85,910 (22,010 ) 63,900 In-process research & development 3,500 — 3,500 Total acquisition-related intangible assets, net $ 89,410 $ (22,010 ) $ 67,400 December 31, 2014 (In thousands) Gross Assets Accumulated Amortization Net Weighted-Average Amortization Period Developed technology $ 67,670 $ (11,607 ) $ 56,063 9.4 years Customer relationships 12,910 (3,493 ) 9,417 6.8 years Trade name 3,700 (670 ) 3,030 8.9 years Non-competition agreements 700 (563 ) 137 2.0 years Other intangible assets 930 (786 ) 144 1.2 years Acquisition-related intangible assets subject to amortization, net 85,910 (17,119 ) 68,791 In-process research & development 3,500 — 3,500 Total acquisition-related intangible assets, net $ 89,410 $ (17,119 ) $ 72,291 |
Acquisition-Related Intangible Assets Amortization Schedule | Based on the carrying value of Acquisition-related intangible assets, net as of June 26, 2015 , the annual amortization expense for Acquisition-related intangible assets, net is expected to be as follows: Fiscal Year Amortization Expense (In thousands) 2015 (remaining six months) $ 4,755 2016 9,327 2017 9,151 2018 9,039 2019 8,938 2020 and Thereafter 22,690 Total $ 63,900 |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Cash and Available-for-sale Securities by Significant Investment Category | The following tables summarize our cash and available-for-sale securities by significant investment category. June 26, 2015 (In thousands) Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Marketable Securities Long-Term Marketable Securities Cash $ 71,407 $ — $ — $ 71,407 $ 71,407 $ — $ — Available-for-sale: Level 1: Money market funds 1,773,821 — — 1,773,821 1,773,821 — — U.S. treasury securities 1,016,744 4,786 (268 ) 1,021,262 5,725 79,653 935,884 Subtotal 2,790,565 4,786 (268 ) 2,795,083 1,779,546 79,653 935,884 Level 2: U.S. agency securities 31,432 9 (30 ) 31,411 — 7,495 23,916 Non-U.S. government securities 47,888 13 (38 ) 47,863 — 11,474 36,389 Municipal bonds 3,507 1 (5 ) 3,503 2,001 1,502 Corporate debt securities 1,580,979 939 (8,157 ) 1,573,761 1,800 120,710 1,451,251 Subtotal 1,663,806 962 (8,230 ) 1,656,538 1,800 141,680 1,513,058 Total $ 4,525,778 $ 5,748 $ (8,498 ) $ 4,523,028 $ 1,852,753 $ 221,333 $ 2,448,942 December 31, 2014 (In thousands) Cost Unrealized Gains Unrealized Losses Fair Value Cash and Cash Equivalents Short-Term Marketable Securities Long-Term Marketable Securities Cash $ 57,505 $ — $ — $ 57,505 $ 57,505 $ — $ — Available-for-sale: Level 1: Money market funds 2,366,799 — — 2,366,799 2,366,799 — — U.S. treasury securities 1,338,162 12,721 (2,302 ) 1,348,581 500 38,938 1,309,143 Subtotal 3,704,961 12,721 (2,302 ) 3,715,380 2,367,299 38,938 1,309,143 Level 2: U.S. agency securities 21,186 12 (7 ) 21,191 — 11,748 9,443 Non-U.S. government securities 31,281 2 (17 ) 31,266 — 19,459 11,807 Municipal bonds 2,000 2 — 2,002 — 1,001 1,001 Corporate debt securities 693,638 362 (1,115 ) 692,885 1,563 80,373 610,949 Subtotal 748,105 378 (1,139 ) 747,344 1,563 112,581 633,200 Total $ 4,510,571 $ 13,099 $ (3,441 ) $ 4,520,229 $ 2,426,367 $ 151,519 $ 1,942,343 |
Schedule of Investments Classified by Contractual Maturity Date | The adjusted cost and estimated fair value of marketable debt securities (corporate debt securities, municipal bonds, U.S. and foreign government securities, and U.S. treasury securities) as of June 26, 2015 , by contractual maturity, are shown below. Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations without call or prepayment penalties. June 26, 2015 (In thousands) Cost Estimated Fair Value Due in one year or less $ 228,777 $ 228,858 Due after one year through five years 2,046,919 2,043,059 Due between six and ten years 404,854 405,883 $ 2,680,550 $ 2,677,800 |
Accounts Receivable, Net and 25
Accounts Receivable, Net and Significant Customers (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract] | |
Schedule of Accounts Receivable, Net | Accounts receivable, net consisted of the following: (In thousands) June 26, December 31, Gross accounts receivable $ 424,927 $ 380,442 Allowance for doubtful accounts (500 ) (500 ) Allowance for sales returns — (1,978 ) Accounts receivable, net $ 424,427 $ 377,964 |
Schedule of Net Sales by Customer Type and Net Sales to Significant Customers | We sell our products to original equipment manufacturers ("OEMs") and to electronic components distributors who resell these products to OEMs, or their contract manufacturers. Net sales by customer type and net sales to significant customers were as follows: Three Months Ended Six Months Ended (Percentage of Net Sales) June 26, June 27, June 26, 2015 June 27, 2014 Sales to distributors 85 % 72 % 79 % 73 % Sales to OEMs 15 % 28 % 21 % 27 % 100 % 100 % 100 % 100 % Significant Distributors (1) : Arrow Electronics, Inc. ( “Arrow”) 45 % 38 % 43 % 38 % Macnica, Inc. (“Macnica”) 27 % 23 % 24 % 23 % (1) Except as presented above, no other distributor accounted for greater than 10% of our net sales for the three months and six months ended June 26, 2015 or June 27, 2014 . |
Inventories (Tables)
Inventories (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventories consisted of the following: (In thousands) June 26, December 31, Raw materials $ 6,856 $ 6,826 Work in process 124,226 95,675 Finished goods 46,572 50,886 Total inventories $ 177,654 $ 153,387 |
Deferred Income and Allowance27
Deferred Income and Allowances on Sales to Distributors (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Deferred Revenue Disclosure [Abstract] | |
Schedule of Deferred Income and Allowances on Sales to Distributors | Deferred income and allowances on sales to distributors consisted of the following: (In thousands) June 26, December 31, Deferred revenue on shipment to distributors $ 421,174 $ 369,560 Deferred cost of sales on shipment to distributors (32,113 ) (32,172 ) Deferred income on shipment to distributors 389,061 337,388 Other deferred revenue (1) 5,860 6,780 Total $ 394,921 $ 344,168 (1) Principally represents revenue deferred on our maintenance contracts, software and intellectual property licenses. |
Schedule of Deferred Income and Allowances on Sales to Distributors Activity | The Deferred income and allowances on sales to distributors activity was as follows: Six Months Ended (In thousands) June 26, June 27, Balance at beginning of period $ 344,168 $ 487,746 Deferred revenue recognized upon shipment to distributors 3,031,752 2,853,749 Deferred cost of sales recognized upon shipment to distributors (143,573 ) (134,974 ) Revenue recognized upon sell-through to end customers (535,018 ) (559,914 ) Cost of sales recognized upon sell-through to end customers 142,606 133,531 Earned distributor price concessions (1) (2,422,463 ) (2,329,017 ) Returns (21,671 ) (35,866 ) Other (880 ) (56 ) Balance at end of period $ 394,921 $ 415,199 (1) Average aggregate price concessions typically range from 70% to 85% of our list price on an annual basis, depending upon the composition of our sales, volumes and factors associated with timing of shipments to distributors. |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Income Per Share | A reconciliation of basic and diluted Net income per share is presented below: Three Months Ended Six Months Ended (In thousands, except per share amounts) June 26, June 27, June 26, June 27, Basic: Net income $ 70,339 $ 127,004 $ 165,191 $ 243,518 Basic weighted shares outstanding 301,799 311,000 301,561 313,713 Net income per share $ 0.23 $ 0.41 $ 0.55 $ 0.78 Diluted: Net income $ 70,339 $ 127,004 $ 165,191 $ 243,518 Weighted shares outstanding 301,799 311,000 301,561 313,713 Effect of dilutive securities: Stock options, employee stock purchase plan, and restricted stock unit shares 2,805 2,513 2,390 2,432 Diluted weighted shares outstanding 304,604 313,513 303,951 316,145 Net income per share $ 0.23 $ 0.41 $ 0.54 $ 0.77 |
Credit Facility and Long-Term29
Credit Facility and Long-Term Debt (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The carrying values and associated effective interest rates for our Long-term debt were as follows: (In thousands, except rates) Effective Interest Rate June 26, 2015 December 31, 2014 2013 Senior Notes due November 15, 2018 at 2.50% 2.71% $ 597,876 $ 597,557 2013 Senior Notes due November 15, 2023 at 4.10% 4.29% 395,810 395,559 2012 Senior Notes due May 15, 2017 at 1.75% 1.94% 499,720 499,643 Total long-term debt $ 1,493,406 $ 1,492,759 |
Schedule of Carrying Values of Debt Instruments | The carrying values of the Notes are reflected in our consolidated balance sheets as follows: 2.50% Notes 4.10% Notes 1.75% Notes (In thousands) June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 Principal amount $ 600,000 $ 600,000 $ 400,000 $ 400,000 $ 500,000 $ 500,000 Unamortized discount (2,124 ) (2,443 ) (4,190 ) (4,441 ) (280 ) (357 ) Net carrying value $ 597,876 $ 597,557 $ 395,810 $ 395,559 $ 499,720 $ 499,643 |
Schedule of Interest Costs, Debt | Interest expense related to the Notes is included in Interest expense in the consolidated statements of comprehensive income as follows: Three Months Ended Six Months Ended (In thousands) June 26, 2015 June 27, 2014 June 26, 2015 June 27, 2014 Contractual coupon interest $ 10,016 $ 10,015 $ 19,554 $ 19,667 Amortization of debt issuance costs 455 456 911 911 Amortization of debt discount 324 323 647 647 Total interest expense related to the Notes $ 10,795 $ 10,794 $ 21,112 $ 21,225 |
Schedule of Maturities of Long-term Debt | As of June 26, 2015 , future principal payments for the Notes were as follows: Fiscal Year Payable (In thousands) 2015 (remaining six months) $ — 2016 — 2017 500,000 2018 600,000 2019 — 2020 and after 400,000 Total $ 1,500,000 |
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis | The estimated fair value of the Notes is as follows: 2.50% Notes 4.10% Notes 1.75% Notes (In thousands) June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 June 26, 2015 December 31, 2014 Estimated fair value $ 610,440 $ 606,564 $ 416,400 $ 417,480 $ 502,320 $ 501,460 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Compensation Expense Included in the Consolidated Statements of Comprehensive Income | Stock-based compensation expense included in our consolidated statements of comprehensive income was as follows: Three Months Ended Six Months Ended (In thousands) June 26, June 27, June 26, June 27, Cost of sales $ 440 $ 495 $ 847 $ 961 Research and development expense 9,670 10,877 18,613 21,150 Selling, general, and administrative expense 11,907 13,349 22,882 25,957 Pre-tax stock-based compensation expense 22,017 24,721 42,342 48,068 Less: income tax benefit (6,115 ) (6,651 ) (11,736 ) (12,845 ) Net stock-based compensation expense $ 15,902 $ 18,070 $ 30,606 $ 35,223 |
Schedule of Assumptions Used to Estimate Fair Value of Employee Stock Purchase Plan, Restricted Stock Units, Performance-Based Restricted Stock Units | The assumptions used to estimate the fair value of the RSU awards granted under our stock-based compensation plans were as follows: Three Months Ended Six Months Ended June 26, June 27, June 26, June 27, ESPP Purchase Rights: Expected term (in years) 0.8 1.0 0.8 1.0 Expected stock price volatility 41.8 % 25.5 % 41.8 % 25.5 % Risk-free interest rate 0.1 % 0.1 % 0.1 % 0.1 % Dividend yield 1.6 % 1.9 % 1.6 % 1.9 % Weighted-average estimated fair value $ 12.90 $ 7.68 $ 12.90 $ 7.68 RSUs: Risk-free interest rate 0.8 % 0.7 % 0.8 % 0.7 % Dividend yield 1.6 % 1.9 % 1.6 % 1.9 % Weighted-average estimated fair value $ 43.24 $ 31.01 $ 42.63 $ 30.97 PRSUs: Expected Altera stock price volatility 30.0 % 32.2 % 30.0 % 32.2 % Expected Philadelphia Semiconductor Index stock price volatility 19.7 % 24.3 % 19.7 % 24.3 % Risk-free interest rate 1.0 % 0.9 % 1.0 % 0.9 % Dividend yield 1.6 % 1.9 % 1.6 % 1.9 % Weighted-average estimated fair value per share $ 58.02 $ 31.18 $ 58.02 $ 31.18 |
Summary of Activity for Restricted Stock Units and Performance-Based Restricted Stock Units | A summary of activity for our RSUs and PRSUs for the six months ended June 26, 2015 and information regarding RSUs and PRSUs outstanding and expected to vest as of June 26, 2015 is as follows: (In thousands, except per share amounts and terms) Number of Shares Weighted-Average Grant-Date Fair Market Value Per Share Weighted-Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (1) Outstanding, December 31, 2014 5,506 $ 34.00 Grants 1,843 $ 44.45 Vested (1,353 ) $ 34.18 Forfeited/Cancelled (188 ) $ 35.24 Outstanding, June 26, 2015 5,808 $ 37.24 1.6 $ 297,945 Vested and expected to vest, June 26, 2015 5,094 $ 37.24 1.5 $ 261,331 (1) Aggregate intrinsic value represents the closing price per share of our stock on June 26, 2015 , multiplied by the number of RSUs and market-based PRSUs outstanding or vested and expected to vest as of June 26, 2015 . |
Summary of Stock Option Activity | A summary of stock option activity for the six months ended June 26, 2015 and information regarding stock options outstanding, exercisable, and vested and expected to vest as of June 26, 2015 is as follows: (In thousands, except per share amounts and terms) Number of Shares Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (in Years) Aggregate Intrinsic Value (1) Outstanding, December 31, 2014 2,074 $ 32.60 Grants — $ — Exercises (344 ) $ 23.57 Forfeited/Cancelled/Expired (19 ) $ 30.46 Outstanding, June 26, 2015 1,711 $ 34.45 5.2 $ 28,838 Exercisable, June 26, 2015 1,403 $ 34.10 4.9 $ 24,129 Vested and expected to vest, June 26, 2015 1,696 $ 34.45 5.2 $ 28,583 (1) For those stock options with an exercise price below the closing price per share on June 26, 2015 , aggregate intrinsic value represents the difference between the exercise price and the closing price per share of our common stock on June 26, 2015 , multiplied by the number of stock options outstanding, exercisable, or vested and expected to vest as of June 26, 2015 . |
Non-Qualified Deferred Compen31
Non-Qualified Deferred Compensation Plan (Tables) | 6 Months Ended |
Jun. 26, 2015 | |
Non Qualified Deferred Compensation Plan [Abstract] | |
Schedule of NQDC Plan Assets by Significant Investment Category | The following tables summarize the fair value of our NQDC Plan assets by significant investment category: (In thousands) June 26, 2015 December 31, 2014 Deferred compensation plan assets: (1) Level 1: Restricted cash equivalents $ 14,484 $ 14,412 Equity securities 30,766 33,521 Mutual funds 32,790 33,764 Subtotal 78,040 81,697 Level 2: Fixed income securities 1,822 2,082 Total $ 79,862 $ 83,779 (1) Included in Deferred compensation plan — marketable securities and Deferred compensation plan — restricted cash equivalents in the accompanying consolidated balance sheets as of June 26, 2015 and December 31, 2014 . |
Organization and Basis of Pre32
Organization and Basis of Presentation (Details) - May. 31, 2015 - USD ($) | Total |
Pending Merger With Intel Corporation [Line Items] | |
Business Acquisition, Share Price | $ 54 |
Termination Fee, Merger Agreement | $ 500,000,000 |
Maximum Expense Reimbursement, Merger Agreement Termination | $ 60,000,000 |
Acquisition-Related Intangibl33
Acquisition-Related Intangible Assets, Net (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 26, 2015 | Dec. 31, 2014 | May. 21, 2013 | |
Schedule of Acquired Intangible Asset by Major Class [Line Items] | |||
Acquired Finite-Lived Intangible Assets, Gross | $ 85,910 | $ 85,910 | |
Acquired Finite-Lived Intangible Assets, Accumulated Amortization | (22,010) | (17,119) | |
Acquired Finite-Lived Intangible Assets, Net | 63,900 | 68,791 | |
Acquisition-related Intangible Assets, Gross | 89,410 | 89,410 | |
Acquisition-related Intangible Assets, Net | 67,400 | 72,291 | |
In Process Research and Development [Member] | |||
Schedule of Acquired Intangible Asset by Major Class [Line Items] | |||
Acquired Indefinite-Lived Intangible Assets (Excluding Goodwill) | 3,500 | 3,500 | $ 28,100 |
Developed Technology Rights [Member] | |||
Schedule of Acquired Intangible Asset by Major Class [Line Items] | |||
Acquired Finite-Lived Intangible Assets, Gross | 67,670 | 67,670 | |
Acquired Finite-Lived Intangible Assets, Accumulated Amortization | (15,189) | (11,607) | |
Acquired Finite-Lived Intangible Assets, Net | $ 52,481 | $ 56,063 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 9 years 4 months 24 days | 9 years 4 months 24 days | |
Customer Relationships [Member] | |||
Schedule of Acquired Intangible Asset by Major Class [Line Items] | |||
Acquired Finite-Lived Intangible Assets, Gross | $ 12,910 | $ 12,910 | |
Acquired Finite-Lived Intangible Assets, Accumulated Amortization | (4,442) | (3,493) | |
Acquired Finite-Lived Intangible Assets, Net | $ 8,468 | $ 9,417 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 6 years 9 months 18 days | 6 years 9 months 18 days | |
Trade Names [Member] | |||
Schedule of Acquired Intangible Asset by Major Class [Line Items] | |||
Acquired Finite-Lived Intangible Assets, Gross | $ 3,700 | $ 3,700 | |
Acquired Finite-Lived Intangible Assets, Accumulated Amortization | (877) | (670) | |
Acquired Finite-Lived Intangible Assets, Net | $ 2,823 | $ 3,030 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 8 years 10 months 24 days | 8 years 10 months 24 days | |
Noncompete Agreements [Member] | |||
Schedule of Acquired Intangible Asset by Major Class [Line Items] | |||
Acquired Finite-Lived Intangible Assets, Gross | $ 700 | $ 700 | |
Acquired Finite-Lived Intangible Assets, Accumulated Amortization | (700) | (563) | |
Acquired Finite-Lived Intangible Assets, Net | $ 0 | $ 137 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 2 years | 2 years | |
Other Intangible Assets [Member] | |||
Schedule of Acquired Intangible Asset by Major Class [Line Items] | |||
Acquired Finite-Lived Intangible Assets, Gross | $ 930 | $ 930 | |
Acquired Finite-Lived Intangible Assets, Accumulated Amortization | (802) | (786) | |
Acquired Finite-Lived Intangible Assets, Net | $ 128 | $ 144 | |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 1 year 2 months 24 days | 1 year 2 months 24 days |
Acquisition-Related Intangibl34
Acquisition-Related Intangible Assets, Net (Annual Amortization Expense) (Details) - USD ($) $ in Thousands | Jun. 26, 2015 | Dec. 31, 2014 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2015 (remaining six months) | $ 4,755 | |
2,016 | 9,327 | |
2,017 | 9,151 | |
2,018 | 9,039 | |
2,019 | 8,938 | |
2020 and Thereafter | 22,690 | |
Acquired Finite-Lived Intangible Assets, Net | $ 63,900 | $ 68,791 |
Financial Instruments (Details
Financial Instruments (Details 1) - USD ($) $ in Thousands | Jun. 26, 2015 | Dec. 31, 2014 |
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | $ 4,525,778 | $ 4,510,571 |
Unrealized Gains | 5,748 | 13,099 |
Unrealized Losses | (8,498) | (3,441) |
Investments, Fair Value Disclosure | 4,523,028 | 4,520,229 |
Cash and Cash Equivalents, Fair Value Disclosure | 1,852,753 | 2,426,367 |
Short-Term Marketable Securities | 221,333 | 151,519 |
Long-Term Marketable Securities | 2,448,942 | 1,942,343 |
Cash [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash | 71,407 | 57,505 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Short-Term Marketable Securities | 0 | 0 |
Long-Term Marketable Securities | 0 | 0 |
Level 1 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 2,790,565 | 3,704,961 |
Unrealized Gains | 4,786 | 12,721 |
Unrealized Losses | (268) | (2,302) |
Investments, Fair Value Disclosure | 2,795,083 | 3,715,380 |
Cash and Cash Equivalents, Fair Value Disclosure | 1,779,546 | 2,367,299 |
Short-Term Marketable Securities | 79,653 | 38,938 |
Long-Term Marketable Securities | 935,884 | 1,309,143 |
Level 1 [Member] | Money Market Funds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 1,773,821 | 2,366,799 |
Unrealized Gains | 0 | 0 |
Unrealized Losses | 0 | 0 |
Investments, Fair Value Disclosure | 1,773,821 | 2,366,799 |
Cash and Cash Equivalents, Fair Value Disclosure | 1,773,821 | 2,366,799 |
Short-Term Marketable Securities | 0 | 0 |
Long-Term Marketable Securities | 0 | 0 |
Level 1 [Member] | U.S. Treasury Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 1,016,744 | 1,338,162 |
Unrealized Gains | 4,786 | 12,721 |
Unrealized Losses | (268) | (2,302) |
Investments, Fair Value Disclosure | 1,021,262 | 1,348,581 |
Cash and Cash Equivalents, Fair Value Disclosure | 5,725 | 500 |
Short-Term Marketable Securities | 79,653 | 38,938 |
Long-Term Marketable Securities | 935,884 | 1,309,143 |
Level 2 [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 1,663,806 | 748,105 |
Unrealized Gains | 962 | 378 |
Unrealized Losses | (8,230) | (1,139) |
Investments, Fair Value Disclosure | 1,656,538 | 747,344 |
Cash and Cash Equivalents, Fair Value Disclosure | 1,800 | 1,563 |
Short-Term Marketable Securities | 141,680 | 112,581 |
Long-Term Marketable Securities | 1,513,058 | 633,200 |
Level 2 [Member] | U.S. Agency Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 31,432 | 21,186 |
Unrealized Gains | 9 | 12 |
Unrealized Losses | (30) | (7) |
Investments, Fair Value Disclosure | 31,411 | 21,191 |
Cash and Cash Equivalents, Fair Value Disclosure | 0 | 0 |
Short-Term Marketable Securities | 7,495 | 11,748 |
Long-Term Marketable Securities | 23,916 | 9,443 |
Level 2 [Member] | Non-U.S. government securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 47,888 | 31,281 |
Unrealized Gains | 13 | 2 |
Unrealized Losses | (38) | (17) |
Investments, Fair Value Disclosure | 47,863 | 31,266 |
Cash and Cash Equivalents, Fair Value Disclosure | 0 | 0 |
Short-Term Marketable Securities | 11,474 | 19,459 |
Long-Term Marketable Securities | 36,389 | 11,807 |
Level 2 [Member] | Municipal Bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 3,507 | 2,000 |
Unrealized Gains | 1 | 2 |
Unrealized Losses | (5) | 0 |
Investments, Fair Value Disclosure | $ 3,503 | 2,002 |
Cash and Cash Equivalents, Fair Value Disclosure | 0 | |
Short-Term Marketable Securities | $ 2,001 | 1,001 |
Long-Term Marketable Securities | 1,502 | 1,001 |
Level 2 [Member] | Corporate Debt Securities [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Cash and Available for Sale Securities, Cost | 1,580,979 | 693,638 |
Unrealized Gains | 939 | 362 |
Unrealized Losses | (8,157) | (1,115) |
Investments, Fair Value Disclosure | 1,573,761 | 692,885 |
Cash and Cash Equivalents, Fair Value Disclosure | 1,800 | 1,563 |
Short-Term Marketable Securities | 120,710 | 80,373 |
Long-Term Marketable Securities | $ 1,451,251 | $ 610,949 |
Financial Instruments (Detail36
Financial Instruments (Details 2) $ in Millions | Jun. 26, 2015USD ($) |
Investments, Debt and Equity Securities [Abstract] | |
Cost Method Investments | $ 24.6 |
Financial Instruments (Detail37
Financial Instruments (Details 3) $ in Thousands | Jun. 26, 2015USD ($) |
Investments, Debt and Equity Securities [Abstract] | |
Available-for-sale Securities, Debt Maturities, Next Twelve Months, Amortized Cost Basis | $ 228,777 |
Available-for-sale Securities, Debt Maturities, Next Twelve Months, Fair Value | 228,858 |
Available-for-sale Securities, Debt Maturities, Year Two Through Five, Amortized Cost Basis | 2,046,919 |
Available-for-sale Securities, Debt Maturities, Year Two Through Five, Fair Value | 2,043,059 |
Available-for-sale Securities, Debt Maturities, Year Six Through Ten, Amortized Cost Basis | 404,854 |
Available-for-sale Securities, Debt Maturities, Year Six Through Ten, Fair Value | 405,883 |
Available-for-sale Securities, Debt Maturities, Without Single Maturity Date, Amortized Cost Basis | 2,680,550 |
Available-for-sale Securities, Debt Maturities, without Single Maturity Date, Fair Value | $ 2,677,800 |
Financial Instruments (Detail38
Financial Instruments (Details 4) - USD ($) $ in Millions | Jun. 26, 2015 | Dec. 31, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value | $ 1,300 | $ 1,100 |
Available-for-Sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses Accumulated in Investments | $ 8.5 | $ 3.4 |
Accounts Receivable, Net and 39
Accounts Receivable, Net and Significant Customers (Accounts Receivables) (Details) - USD ($) $ in Thousands | Jun. 26, 2015 | Dec. 31, 2014 |
Accounts Receivable, Net [Abstract] | ||
Gross accounts receivable | $ 424,927 | $ 380,442 |
Allowance for doubtful accounts | (500) | (500) |
Allowance for sales returns | 0 | (1,978) |
Accounts receivable, net | $ 424,427 | $ 377,964 |
Accounts Receivable, Net and 40
Accounts Receivable, Net and Significant Customers (Significant Customers) (Details) | 3 Months Ended | 6 Months Ended | ||||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | Dec. 31, 2014 | ||
Revenue, Major Customer [Line Items] | ||||||
Sales to distributors | 85.00% | 72.00% | 79.00% | 73.00% | ||
Sales to OEMs | 15.00% | 28.00% | 21.00% | 27.00% | ||
Concentration Risk, Percentage | 100.00% | 100.00% | 100.00% | 100.00% | ||
Arrow Electronics, Inc | ||||||
Revenue, Major Customer [Line Items] | ||||||
Sales to distributors | [1] | 45.00% | 38.00% | 43.00% | 38.00% | |
Accounts Receivable From Distributors As Percentage Of Total Accounts Receivables | 30.00% | 30.00% | 34.00% | |||
Macnica, Inc | ||||||
Revenue, Major Customer [Line Items] | ||||||
Sales to distributors | [1] | 27.00% | 23.00% | 24.00% | 23.00% | |
Accounts Receivable From Distributors As Percentage Of Total Accounts Receivables | 57.00% | 57.00% | 47.00% | |||
OEM One | ||||||
Revenue, Major Customer [Line Items] | ||||||
Sales to OEMs | 11.00% | 11.00% | ||||
[1] | Except as presented above, no other distributor accounted for greater than 10% of our net sales for the three months and six months ended June 26, 2015 or June 27, 2014. |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Jun. 26, 2015 | Dec. 31, 2014 |
Inventory Disclosure [Abstract] | ||
Raw Materials | $ 6,856 | $ 6,826 |
Work in Process | 124,226 | 95,675 |
Finished Goods | 46,572 | 50,886 |
Total inventories | $ 177,654 | $ 153,387 |
Deferred Income and Allowance42
Deferred Income and Allowances on Sales to Distributors (Details) - USD ($) $ in Thousands | 6 Months Ended | |||
Jun. 26, 2015 | Jun. 27, 2014 | Dec. 31, 2014 | ||
Deferred Income and Allowances on Sales to Distributors | ||||
Deferred revenue on shipment to distributors | $ 421,174 | $ 369,560 | ||
Deferred cost of sales on shipment to distributors | (32,113) | (32,172) | ||
Deferred income on shipment to distributors | 389,061 | 337,388 | ||
Other deferred revenue | [1] | 5,860 | 6,780 | |
Total | 394,921 | $ 344,168 | ||
Deferred Income and Allowances on Sales to Distributor Activity | ||||
Balance at beginning of period | 344,168 | $ 487,746 | ||
Deferred revenue recognized upon shipment to distributors | 3,031,752 | 2,853,749 | ||
Deferred cost of sales recognized upon shipment to distributors | (143,573) | (134,974) | ||
Revenue recognized upon sell-through to end customers | (535,018) | (559,914) | ||
Cost of sales recognized upon sell-through to end customers | 142,606 | 133,531 | ||
Earned distributor price concessions | [2] | (2,422,463) | (2,329,017) | |
Returns | (21,671) | (35,866) | ||
Other | (880) | (56) | ||
Balance at end of period | $ 394,921 | $ 415,199 | ||
Deferred Income and Allowances on Sales to Distributors Textuals [Abstract] | ||||
Minimum percentage of average aggregate price concessions on list price | 70.00% | |||
Maximum percentage of average aggregate price concessions on list price | 85.00% | |||
Maximum time period to submit claim for receiving price concession, days | 60 days | |||
Period of settlement for receivable balances, days | 30 days | |||
[1] | Principally represents revenue deferred on our maintenance contracts, software and intellectual property licenses. | |||
[2] | Average aggregate price concessions typically range from 70% to 85% of our list price on an annual basis, depending upon the composition of our sales, volumes and factors associated with timing of shipments to distributors. |
Accumulated Other Comprehensi43
Accumulated Other Comprehensive (Loss)/Income (Details) - USD ($) $ in Thousands | Jun. 26, 2015 | Dec. 31, 2014 |
Equity [Abstract] | ||
Accumulated unrecognized (loss)/gains on available-for-sale securities, net of tax | $ (2,329) | $ 9,645 |
Net Income Per Share (Details)
Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | |
Basic: | ||||
Net income | $ 70,339 | $ 127,004 | $ 165,191 | $ 243,518 |
Basic weighted shares outstanding (in shares) | 301,799 | 311,000 | 301,561 | 313,713 |
Net income per share (in dollars per share) | $ 0.23 | $ 0.41 | $ 0.55 | $ 0.78 |
Diluted: | ||||
Net income | $ 70,339 | $ 127,004 | $ 165,191 | $ 243,518 |
Basic weighted shares outstanding (in shares) | 301,799 | 311,000 | 301,561 | 313,713 |
Stock options, ESPP, and restricted stock unit shares (in shares) | 2,805 | 2,513 | 2,390 | 2,432 |
Diluted weighted shares outstanding | 304,604 | 313,513 | 303,951 | 316,145 |
Net income per share (in dollars per share) | $ 0.23 | $ 0.41 | $ 0.54 | $ 0.77 |
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 100 | 2,200 | 700 | 2,000 |
Credit Facility and Long-Term45
Credit Facility and Long-Term Debt (Credit Facility) (Details) - Line of Credit [Member] - USD ($) | Jun. 29, 2012 | Jun. 26, 2015 |
Debt Instrument [Line Items] | ||
Debt instrument, Term | 5 years | |
Line of credit facility, maximum borrowing capacity | $ 250,000,000 | |
Increase in borrowing capacity of line of credit | $ 250,000,000 | |
Revolving Credit Facility | $ 0 |
Credit Facility and Long-Term46
Credit Facility and Long-Term Debt (Debt Instruments) (Details) - USD ($) | Oct. 29, 2013 | May. 08, 2012 | Jun. 26, 2015 | Dec. 31, 2014 |
Debt Instrument [Line Items] | ||||
Debt Instrument, Unamortized Discount | $ (8,200,000) | $ (800,000) | ||
Carrying amount | $ 1,493,406,000 | $ 1,492,759,000 | ||
Proceeds from issuance of long term debt | 991,800,000 | 499,200,000 | ||
Debt Issuance Cost | $ 5,500,000 | $ 3,700,000 | ||
Debt Instrument, Redemption Price, Percentage | 101.00% | |||
Senior Notes [Member] | Two Point Five Percent Senior Notes Maturing November 15, 2018 [Member] | ||||
Debt Instrument [Line Items] | ||||
Due Date | Nov. 15, 2018 | |||
Coupon rate | 2.50% | |||
Effective interest rate | 2.71% | |||
Principal Amount | $ 600,000,000 | $ 600,000,000 | 600,000,000 | |
Debt Instrument, Unamortized Discount | (2,124,000) | (2,443,000) | ||
Carrying amount | 597,876,000 | 597,557,000 | ||
Debt Instrument, Fair Value Disclosure | 610,440,000 | 606,564,000 | ||
Senior Notes [Member] | Four Point One Percent Senior Notes Maturing November 15, 2023 [Member] | ||||
Debt Instrument [Line Items] | ||||
Due Date | Nov. 15, 2023 | |||
Coupon rate | 4.10% | |||
Effective interest rate | 4.29% | |||
Principal Amount | $ 400,000,000 | 400,000,000 | 400,000,000 | |
Debt Instrument, Unamortized Discount | (4,190,000) | (4,441,000) | ||
Carrying amount | 395,810,000 | 395,559,000 | ||
Debt Instrument, Fair Value Disclosure | 416,400,000 | 417,480,000 | ||
Senior Notes [Member] | One Point Seven Five Percent Senior Note Maturing May 15, 2017 [Member] | ||||
Debt Instrument [Line Items] | ||||
Due Date | May 15, 2017 | |||
Coupon rate | 1.75% | |||
Effective interest rate | 1.94% | |||
Principal Amount | $ 500,000,000 | 500,000,000 | 500,000,000 | |
Debt Instrument, Unamortized Discount | (280,000) | (357,000) | ||
Carrying amount | 499,720,000 | 499,643,000 | ||
Debt Instrument, Fair Value Disclosure | $ 502,320,000 | $ 501,460,000 |
Credit Facility and Long-Term47
Credit Facility and Long-Term Debt (Interest Expense) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | |
Debt Disclosure [Abstract] | ||||
Contractual coupon interest | $ 10,016 | $ 10,015 | $ 19,554 | $ 19,667 |
Amortization of debt issuance costs | 455 | 456 | 911 | 911 |
Amortization of Debt Discount, Net | 324 | 323 | 647 | 647 |
Total Interest Expense related to senior notes | $ 10,795 | $ 10,794 | $ 21,112 | $ 21,225 |
Credit Facility and Long-Term48
Credit Facility and Long-Term Debt (Maturities of Principal Payments) (Details) | Jun. 26, 2015USD ($) |
Debt Disclosure [Abstract] | |
2015 (remaining six months) | $ 0 |
2,016 | 0 |
2,017 | 500,000,000 |
2,018 | 600,000,000 |
2,019 | 0 |
2020 and after | 400,000,000 |
Total | $ 1,500,000,000 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | Oct. 08, 2014lawsuits | Jun. 26, 2015USD ($)lawsuits | Dec. 31, 2008USD ($) | Mar. 29, 2013USD ($) | Jan. 23, 2012USD ($) | Dec. 08, 2011USD ($) |
Commitments and Contingencies Disclosure [Abstract] | ||||||
Significant Commitment, Remaining Minimum Amount Committed | $ 141.5 | |||||
Non-cancelable license obligations | $ 11.7 | |||||
Loss Contingencies [Line Items] | ||||||
Loss Contingency, Pending Claims, Number | lawsuits | 2 | |||||
Income Taxes Paid | $ 18 | |||||
Tax Return Examination Years 2002 through 2004 [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority | $ 19.8 | |||||
Tax Return Examination Years 2005 through 2007 [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority | $ 21.4 | |||||
Tax Return Examination Years 2004 through 2007 [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority | $ (6.8) | |||||
Altera shareholder class action lawsuits [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss Contingency, Claims Filed, Number | lawsuits | 1 | |||||
PLL Technologies, Inc. [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss Contingency, Claims Settled and Dismissed, Number | lawsuits | 1 | |||||
PACT XPP Technologies, AG [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Loss Contingency, Claims Filed, Number | lawsuits | 1 |
Stock-Based Compensation (Expen
Stock-Based Compensation (Expense Included in the Consolidated Statements of Comprehensive Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Pre-tax stock-based compensation expense | $ 22,017 | $ 24,721 | $ 42,342 | $ 48,068 |
Less: income tax benefit | (6,115) | (6,651) | (11,736) | (12,845) |
Net stock-based compensation expense | 15,902 | 18,070 | 30,606 | 35,223 |
Unrecognized stock-based compensation | 151,000 | $ 151,000 | ||
Unrecognized stock-based compensation, period for recognition | 2 years 3 months | |||
Cost of sales [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Pre-tax stock-based compensation expense | 440 | 495 | $ 847 | 961 |
Research and Development Expense [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Pre-tax stock-based compensation expense | 9,670 | 10,877 | 18,613 | 21,150 |
Selling, General and Administrative Expenses [Member] | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Pre-tax stock-based compensation expense | $ 11,907 | $ 13,349 | $ 22,882 | $ 25,957 |
Stock-Based Compensation (Valua
Stock-Based Compensation (Valuation Assumptions) (Details) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | |
Employee Stock (ESPP) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term | 9 months | 1 year | 9 months | 1 year |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 41.80% | 25.50% | 41.80% | 25.50% |
Risk-free interest rate | 0.10% | 0.10% | 0.10% | 0.10% |
Dividend yield | 1.60% | 1.90% | 1.60% | 1.90% |
Weighted-average estimated fair value | $ 12.90 | $ 7.68 | $ 12.90 | $ 7.68 |
Restricted Stock Units (RSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Risk-free interest rate | 0.80% | 0.70% | 0.80% | 0.70% |
Dividend yield | 1.60% | 1.90% | 1.60% | 1.90% |
Weighted-average estimated fair value | $ 43.24 | $ 31.01 | $ 42.63 | $ 30.97 |
Performance-based Restricted Stock Units (Market-Based PRSUs) [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate | 30.00% | 32.20% | 30.00% | 32.20% |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate, SOX [Abstract] | 19.70% | 24.30% | 19.70% | 24.30% |
Risk-free interest rate | 1.00% | 0.90% | 1.00% | 0.90% |
Dividend yield | 1.60% | 1.90% | 1.60% | 1.90% |
Weighted-average estimated fair value | $ 58.02 | $ 31.18 | $ 58.02 | $ 31.18 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands | May. 04, 2015 | May. 13, 2014 | May. 05, 2014 | May. 06, 2013 | Jul. 30, 2012 | Jun. 26, 2015 | Jun. 26, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Shares reserved for future issuance under the Equity Plan | 25,000,000 | 25,000,000 | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 16,700,000 | 16,700,000 | ||||||
Restricted Stock Units And Performance Based Restricted Stock Units [Member] | ||||||||
RSUs and PRSUs, Number of Shares | ||||||||
Outstanding, December 31, 2014 | 5,506,000 | |||||||
Grants | 1,843,000 | |||||||
Vested | (1,353,000) | |||||||
Forfeited/Cancelled | (188,000) | |||||||
Outstanding, June 26, 2015 | 5,808,000 | 5,808,000 | ||||||
Vested and expected to vest, June 26, 2015 | 5,094,000 | 5,094,000 | ||||||
RSUs and PRSUs, Weighted-Average Grant-Date Fair Market Value Per Share (in dollars per share): | ||||||||
Outstanding, December 31, 2014 | $ 34 | |||||||
Grants | 44.45 | |||||||
Vested | 34.18 | |||||||
Forfeited/Cancelled | 35.24 | |||||||
Outstanding, June 26, 2015 | $ 37.24 | 37.24 | ||||||
Vested and expected to vest, June 26, 2015 | $ 37.24 | $ 37.24 | ||||||
Outstanding, Weighted-Average Remaining Contractual Term (in Years) | 1 year 7 months | |||||||
Outstanding, Aggregate Intrinsic Value | [1] | $ 297,945 | $ 297,945 | |||||
Vested and expected to vest, Weighted-Average Remaining Contractual Term (in Years) | 1 year 6 months | |||||||
Vested and expected to vest, Aggregate Intrinsic Value | [1] | $ 261,331 | $ 261,331 | |||||
Employee Stock Option [Member] | ||||||||
Stock Options, Number of Shares | ||||||||
Outstanding, December 31, 2014 | 2,074,000 | |||||||
Grants | 0 | |||||||
Exercises | (200,000) | (344,000) | ||||||
Forfeited/Cancelled/Expired | (19,000) | |||||||
Outstanding, June 26, 2015 | 1,711,000 | 1,711,000 | ||||||
Exercisable, June 26, 2015 | 1,403,000 | 1,403,000 | ||||||
Vested and expected to vest, June 26, 2015 | 1,696,000 | 1,696,000 | ||||||
Stock Options, Weighted-Average Exercise Price Per Share (in dollars per share): | ||||||||
Outstanding, December 31, 2014 | $ 32.60 | |||||||
Exercises | 23.57 | |||||||
Forfeited/Cancelled/Expired | 30.46 | |||||||
Outstanding, June 26, 2015 | $ 34.45 | 34.45 | ||||||
Exercisable, June 26, 2015 | 34.10 | 34.10 | ||||||
Vested and expected to vest, June 26, 2015 | $ 34.45 | $ 34.45 | ||||||
Outstanding, Weighted-Average Remaining Contractual Term (in Years) | 5 years 2 months | |||||||
Exercisable, Weighted-Average Contractual Term (in Years) | 4 years 10 months 23 days | |||||||
Vested and expected to vest, Weighted-Average Remaining Contractual Term (in Years) | 5 years 2 months | |||||||
Outstanding, Aggregate Intrinsic Value | [2] | $ 28,838 | $ 28,838 | |||||
Exercisable, Aggregate Intrinsic Value | [2] | 24,129 | 24,129 | |||||
Vested and expected to vest, Aggregate Intrinsic Value | [2] | 28,583 | 28,583 | |||||
Intrinsic value of stock options exercised | 5,100 | 6,800 | ||||||
Consideration recorded from exercise of stock options | $ 6,000 | $ 8,100 | ||||||
Performance-based Restricted Stock Units (Market-Based PRSUs) [Member] | ||||||||
RSUs and PRSUs, Number of Shares | ||||||||
Grants | 187,604 | 303,260 | 262,647 | 66,489 | ||||
RSUs and PRSUs, Weighted-Average Grant-Date Fair Market Value Per Share (in dollars per share): | ||||||||
Grants | $ 58.02 | $ 31.13 | $ 31.23 | $ 33.03 | $ 41.18 | |||
[1] | Aggregate intrinsic value represents the closing price per share of our stock on June 26, 2015, multiplied by the number of RSUs and market-based PRSUs outstanding or vested and expected to vest as of June 26, 2015. | |||||||
[2] | For those stock options with an exercise price below the closing price per share on June 26, 2015, aggregate intrinsic value represents the difference between the exercise price and the closing price per share of our common stock on June 26, 2015, multiplied by the number of stock options outstanding, exercisable, or vested and expected to vest as of June 26, 2015. |
Stock-Based Compensation (Emplo
Stock-Based Compensation (Employee Stock Purchase Plan) (Details) - Employee Stock Purchase Plan 1987 [Member] - $ / shares | 6 Months Ended | |
Jun. 26, 2015 | Jun. 27, 2014 | |
Employee Stock Purchase Plan [Line Items] | ||
Stock Issued During Period, Shares, Employee Stock Purchase Plans | 386,613 | 376,031 |
Employee Stock Ownership Plan (ESOP), Weighted Average Purchase Price of Shares Purchased | $ 27.41 | $ 27.61 |
Shares available for future issuance under Employee Stock Purchase Plan | 4,000,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 6 Months Ended | |
Jun. 26, 2015 | Jun. 27, 2014 | |
Stockholders' Equity Note [Abstract] | ||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 233 | |
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased | 16 | |
Stock Repurchased and Retired, Share, Total | 217 | |
Payment For Stock Repurchased and Retired, Total | $ 5,000,000 | |
Stock Repurchased and Retired During Period, Shares | 1.6 | 10.6 |
Payments for Repurchase of Common Stock | $ 57,507 | $ 358,808 |
Common Stock Repurchased and Retired During The Period, Average Cost Per Share | $ 34.95 | $ 33.90 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||
Jun. 26, 2015 | Jun. 27, 2014 | Jun. 26, 2015 | Jun. 27, 2014 | Dec. 31, 2008 | Dec. 31, 2014 | Mar. 29, 2013 | Jan. 23, 2012 | Dec. 08, 2011 | |
Income Tax Contingency [Line Items] | |||||||||
Income Taxes Paid | $ 18 | ||||||||
Effective Tax Rate | 17.70% | 11.50% | 11.70% | 11.00% | |||||
Effective Income Tax Rate Reconciliation, Deduction, Other, Amount | $ 4.2 | $ 4.2 | |||||||
Effective Income Tax Rate Reconciliation, Tax Credit, Foreign, Amount | 7.1 | ||||||||
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations | $ 4 | ||||||||
Other Tax Expense (Benefit) | 1.2 | $ 0.9 | |||||||
Unrecognized Tax Benefits | 362.6 | 362.6 | $ 341.1 | ||||||
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued | $ 49.5 | $ 49.5 | $ 45.8 | ||||||
Tax Return Examination Years 2002 through 2004 [Member] | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority | $ 19.8 | ||||||||
Tax Return Examination Years 2005 through 2007 [Member] | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority | $ 21.4 | ||||||||
Tax Return Examination Years 2004 through 2007 [Member] | |||||||||
Income Tax Contingency [Line Items] | |||||||||
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority | $ (6.8) |
Non-Qualified Deferred Compen56
Non-Qualified Deferred Compensation Plan (Details) $ in Thousands | 6 Months Ended | ||
Jun. 26, 2015USD ($)employee | Dec. 31, 2014USD ($) | ||
Deferred compensation plan - marketable securities [Line Items] | |||
Number of participants NQDC | employee | 131 | ||
Deferred Compensation Plan Assets | [1] | $ 79,862 | $ 83,779 |
Level 1 [Member] | |||
Deferred compensation plan - marketable securities [Line Items] | |||
Deferred Compensation Plan Assets | [1] | 78,040 | 81,697 |
Level 1 [Member] | Restricted cash equivalents [Member] | |||
Deferred compensation plan - marketable securities [Line Items] | |||
Deferred Compensation Plan Assets | [1] | 14,484 | 14,412 |
Level 1 [Member] | Equity securities [Member] | |||
Deferred compensation plan - marketable securities [Line Items] | |||
Deferred Compensation Plan Assets | [1] | 30,766 | 33,521 |
Level 1 [Member] | Mutual funds [Member] | |||
Deferred compensation plan - marketable securities [Line Items] | |||
Deferred Compensation Plan Assets | [1] | 32,790 | 33,764 |
Level 2 [Member] | Fixed income securities [Member] | |||
Deferred compensation plan - marketable securities [Line Items] | |||
Deferred Compensation Plan Assets | [1] | $ 1,822 | $ 2,082 |
[1] | Included in Deferred compensation plan—marketable securities and Deferred compensation plan—restricted cash equivalents in the accompanying consolidated balance sheets as of June 26, 2015 and December 31, 2014. |
Declaration of Dividend Subse57
Declaration of Dividend Subsequent to June 26, 2015 (Details) - Jul. 20, 2015 - Subsequent Event [Member] - $ / shares | Total |
Subsequent Event [Line Items] | |
Cash dividends per common share | $ 0.18 |
Dividends Payable, Date Declared | Jul. 20, 2015 |
Dividends Payable, Date of Record | Aug. 10, 2015 |
Dividends Payable, Date to be Paid | Sep. 1, 2015 |