Seagate 2011 Annual Report Download - page 83
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Table of Contents
SEAGATE TECHNOLOGY PLC
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the earliest period presented, nor
is it intended to be a projection of future results.
The pro forma results for the fiscal years ended June 29, 2012 and July 1, 2011, include adjustments of $65 million and $115 million,
respectively, to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to
property, plant and equipment and intangible assets had been applied on July 3, 2010.
4. Goodwill and Other Long-lived Assets
Goodwill
The changes in the carrying amount of goodwill are as follows:
Other Intangible Assets
Other intangible assets consist primarily of existing technology, customer relationships and In-process research and development acquired
in business combinations. With the exception of In-process research and development, acquired intangibles are amortized on a straight-line basis
over the respective estimated useful lives of the assets. Amortization of the existing technology intangible asset is charged to Cost of revenue
while the amortization of the other intangible assets is included in Operating expenses in the Consolidated Statements of Operations. In-process
research and development has been determined to have an indefinite useful life and is not amortized, but instead tested for impairment annually
or more frequently if events or changes in circumstance indicate that the asset might be impaired. If the carrying amount of In-process research
and development exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. There were no impairment charges
recognized for in-process research and development. Upon completion of the in-process research and development, the related assets will be
accounted for as a finite-lived intangible asset, and will be amortized over its useful life.
In fiscal years 2012, 2011 and 2010, amortization expense for other intangible assets was $75 million, $6 million and $35 million,
respectively.
77
Fiscal Years Ended
(Dollars in millions)
June 29,
2012 July 1,
2011
Revenue
$
16,113
$
13,853
Net income
$
2,761
$
370
(Dollars in millions)
Balance as of July 1, 2011
$
31
Goodwill acquired
(1)
432
Balance as of June 29, 2012
$
463
(1)
During the six months ended June 29, 2012, the Company recorded adjustments that resulted in a net decrease in
goodwill acquired of $5 million. For further information on these adjustments, see "Note 3. Acquisitions."