Seagate 2014 Annual Report Download - page 113
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SEAGATETECHNOLOGYPLC
NOTESTOCONSOLIDATEDFINANCIALSTATEMENTS—(Continued)
Historically,theCompanyhasnotmadeanysignificantindemnificationpaymentsundersuchagreementsandnoamounthasbeenaccruedintheaccompanying
consolidatedfinancialstatementswithrespecttotheseindemnificationobligations.
ProductWarranty
TheCompanyestimatesprobableproductwarrantycostsatthetimerevenueisrecognized.TheCompanygenerallywarrantsitsproductsforaperiodof1to
5years.TheCompanyusesestimatedrepairorreplacementcostsandusesstatisticalmodelingtoestimateproductreturnratesinordertodetermineitswarranty
obligation.ChangesintheCompany'sproductwarrantyliabilityduringthefiscalyearsendedJuly3,2015,June27,2014andJune28,2013wereasfollows:
17.RelatedPartyTransactions
SamsungElectronicsCo.Ltd.("Samsung")InconnectionwiththeCompany'sacquisitionoftheSamsungHDDbusiness,Samsungbecameashareholderof
theCompanyandappointedoneofitsexecutivestotheCompany'sBoardofDirectors.OnOctober22,2013,SamsungfiledanamendmenttoitsSchedule13D
indicatingthatitholdslessthan5%oftheCompany'soutstandingshares.Dr.Seh-WoongJeongwasappointedtoourBoardofDirectorsbySamsungandjoined
ourBoardofDirectorsonApril26,2012.HeretiredfromourBoardofDirectorsonOctober22,2014.TheCompanyrecordedrevenueof$216millionand
$413millionfromsalestoSamsungforfiscalyear2014and2013,respectively.TheCompanymadepaymentstoSamsunginfiscalyears2014and2013of
$318millionand$393million,respectively,relatedtopurchasesofcomponentsandservices.TheCompanyhadaccountspayabletoSamsungof$34millionand
$48millionatJune27,2014andJune28,2013.TheCompanyhadaccountsreceivablefromSamsungof$25millionand$49millionatJune27,2014andJune28,
2013.
MicrosoftCorporation("Microsoft")Duringtheyearspresented(throughMarch2014),theCompany'sChairmanandChiefExecutiveOfficeralsoservedon
theboardofMicrosoft.TheCompanyrecordedrevenueof$208millionand$141millionfromsalestoMicrosoftforfiscalyears2014and2013,respectively.The
CompanymadepaymentstoMicrosoftinfiscalyears2014and2013of$1millionand$2million,respectively,relatedtopurchasesoflicensedsoftware.The
CompanyhadaccountsreceivablefromMicrosoftof$35millionand$33millionatJune27,2014andJune28,2013.
110
FiscalYearsEnded
(Inmillions)
July3,
2015
June27,
2014
June28,
2013
Balance,beginningofperiod $ 273 $ 320 $ 363
Warrantiesissued 147 177 193
Repairsandreplacements (187) (228) (276)
Changesinliabilityforpre-existingwarranties,includingexpirations 7 1 37
Warrantyliabilityassumedfromacquisitions 8 3 3
Balance,endofperiod $ 248 $ 273 $ 320