Intel 2008 Annual Report Download - page 86

Download and view the complete annual report

Please find page 86 of the 2008 Intel annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 143

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143

Table of Contents
INTEL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
Net losses on equity method investments were $1.4 billion in 2008 (net gains of $3 million in 2007 and $2 million in 2006),
including equity method impairment charges of $1.1 billion in 2008 ($28 million in 2007 and $7 million in 2006). During
2008, we recognized a $762 million impairment charge on our investment in Clearwire LLC (for information on the
impairment of our available-for-sale investment in the new Clearwire Corporation, see “Note 7: Gains (Losses) on Other
Equity Investments, Net”) and a $250 million
impairment charge on our investment in Numonyx. Equity method losses on our
investment in the old Clearwire Corporation were $184 million in 2008 and $104 million in 2007, and equity method losses on
our investment in Numonyx were $87 million in 2008. In addition, the net gain on equity method investments in 2007
included approximately $110 million of income due to the reorganization of one of our investments. Equity method losses
were not significant in 2006.
Summarized Financial Information of Equity Method Investees
The following is the aggregated summarized financial information of our equity method investees, which includes summary
results of operations information for fiscal years 2008, 2007, and 2006 and summary balance sheet information as of
December 27, 2008 and December 29, 2007:
Summarized financial information for our equity method investees is presented on the basis of up to a one-quarter lag and is
included for the periods in which we held an equity method ownership interest. Summarized financial information for
Clearwire Corporation is presented as of September 30, 2008, and does not reflect any changes that have occurred as a result
of Clearwire Corporation and Sprint Nextel Corporation combining their respective WiMAX businesses in the fourth quarter
of 2008.
IMFT/IMFS
Micron and Intel formed IM Flash Technologies, LLC (IMFT) in January 2006 and IM Flash Singapore, LLP (IMFS) in
February 2007. We established these joint ventures to manufacture NAND flash memory products for Micron and Intel. Intel
owns a 49% interest in each of these ventures. Our investments were $1.7 billion in IMFT and $329 million in IMFS as of
December 27, 2008 ($2.2 billion in IMFT and $146 million in IMFS as of December 29, 2007). Our investments in these
ventures are classified within other long-term assets. During 2008, IMFT returned $298 million to Intel, and that amount is
reflected as a return of equity method investment within investing activities on the consolidated statements of cash flows.
As part of the initial capital contribution to IMFT, we paid $615 million in cash and issued $581 million in non-interest-
bearing notes. During 2006, we paid the entire balance of $581 million to settle the non-interest-bearing notes, which has been
reflected as a financing activity on the consolidated statements of cash flows. At inception, Micron contributed assets valued at
$995 million and $250 million in cash in exchange for a 51% interest. In addition, we contributed approximately $1.3 billion
over the past three years pursuant to the terms of the original agreement.
77
(In Millions)
2008
2007
2006
Operating results:
Net revenue
$
3,456
$
1,484
$
403
Gross margin
$
444
$
67
$
(13
)
Operating income (loss)
$
(702
)
$
(490
)
$
(76
)
Net income (loss)
$
(932
)
$
(674
)
$
(63
)
Dec. 27,
Dec. 29,
(In Millions)
2008
2007
Balance sheet:
Current assets
$
3,257
$
2,013
Non
-
current assets
$
7,322
$
5,703
Current liabilities
$
1,316
$
653
Non
-
current liabilities
$
2,469
$
1,150
Redeemable preferred stock
$
50
$
Minority interest
$
10
$