Seagate 2011 Annual Report Download - page 57

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Table of Contents
Operating Expenses
Product Development Expense. Product development expenses for fiscal year 2011 were relatively flat from fiscal year 2010, reflecting a
decrease in variable performance-based compensation, offset by an increase in spending for new programs and a decrease in research grants.
Marketing and Administrative Expense. The increase in Marketing and administrative expenses for fiscal year 2011 compared to fiscal
year 2010 was due primarily to an increase related to Samsung acquisition expenses and litigation related expenses. This was offset by a
reduction in total compensation expenses, primarily variable performance-based compensation.
Amortization of Intangibles. Amortization of intangibles for fiscal year 2011 decreased from fiscal year 2010 as certain intangibles
relating to the MetaLINCS, Inc. were fully amortized during 2011.
Restructuring and Other, net. During fiscal year 2011, the recorded restructuring and other charges were primarily associated with
previously announced restructuring activities. Restructuring and Other, net during 2010 included a charge for our AMK restructuring plan
announced in August 2009 and a charge related to our Pittsburgh, Pennsylvania facility.
Impairment of Other Long-Lived Assets, net of Recoveries. During fiscal year 2011, we did not record any impairment charge related to
our long-lived assets, and in 2010 we recorded an impairment charge to adjust the carrying value of certain assets held for sale to their estimated
fair value, less cost to sell.
Other Income (Expense), net
The change in Other expense, net for fiscal year 2011 compared to fiscal year 2010 was primarily due to an increase in interest expense
resulting from higher average debt balances and $24 million in losses related to the redemption of debt.
Income Taxes
53
Fiscal Years Ended
(Dollars in millions)
July 1,
2011
July 2,
2010
Change
%
Change
Product development
$
875
$
877
$
(2
)
—
%
Marketing and administrative
445
437
8
2
%
Amortization of intangibles
2
27
(25
)
(93
)%
Restructuring and other, net
18
66
(48
)
(73
)%
Impairment of other long-lived assets,
net of recoveries
—
57
(57
)
(100
)%
Operating expenses
$
1,340
$
1,464
$
(124
)
Fiscal Years Ended
(Dollars in millions)
July 1,
2011
July 2,
2010
Change
%
Change
Other income (expense), net
$
(227
)
$
(171
)
$
(56
)
33
%
Fiscal Years Ended
(Dollars in millions)
July 1,
2011
July 2,
2010
Change
%
Change
Provision for (benefit from) income taxes
$
68
$
(40
)
$
108
(270
)%