Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

v3.19.3.a.u2
Income Taxes (Tables)
 12 Months Ended
Dec. 28, 2019
Dec. 29, 2018
Income Tax Disclosure [Abstract]    
Schedule of Loss before Income Tax
Income (loss) before income taxes consists of the following:
 
2019
 
2018
 
2017
 
(In millions)
U.S.
$
334

 
$
114

 
$
53

Non-U.S.
38

 
214

 
(68
)
Total pre-tax income (loss) including equity loss in investee
$
372

 
$
328

 
$
(15
)

 
Provision (Benefit) for Income Taxes
The provision for (benefit from) income taxes consists of:
 
2019
 
2018
 
2017
 
(In millions)
Current:
 
 
 
 
 
U.S. Federal
$
(13
)
 
$
12

 
$
(3
)
U.S. State and Local
1

 
—

 
—

Non-U.S.
50

 
(17
)
 
37

Total
38

 
(5
)
 
34

Deferred:
 
 
 
 
 
U.S. Federal
—

 
—

 
(15
)
Non-U.S.
(7
)
 
(4
)
 
(1
)
Total
(7
)
 
(4
)
 
(16
)
Provision for (benefit from) income taxes
$
31

 
$
(9
)
 
$
18


 
Schedule of Effective Income Tax Rate Reconciliation  
The table below displays the reconciliation between statutory federal income taxes and the total provision for (benefit from) income taxes.
 
2019
 
2018
 
2017
 
(In millions)
Statutory federal income tax expense (benefit)
at 21%, 21% and 35% rate
$
78

 
$
69

 
$
22

State taxes
1

 
1

 
1

Foreign withholding taxes (refund)
22

 
(29
)
 
27

Foreign rate detriment
2

 
2

 
—

Valuation allowance change
(59
)
 
(64
)
 
(12
)
Credit monetization
—

 
(1
)
 
(20
)
Tax Reform Act
(13
)
 
13

 
—

Provision for (benefit from) income taxes
$
31

 
$
(9
)
 
$
18


Schedule of Deferred Tax Assets and Liabilities
Deferred income taxes reflect the net tax effects of tax carryovers and temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the balances for income tax purposes. Significant components of the Company’s deferred tax assets and liabilities as of December 28, 2019 and December 29, 2018 are as follows:
 
December 28,
2019
 
December 29,
2018
 
(In millions)
Deferred tax assets:
 
 
 
Net operating loss carryovers
$
1,455

 
$
1,533

Accruals and reserves not currently deductible
245

 
123

Acquired intangibles and goodwill
45

 
101

Federal and state tax credit carryovers
617

 
527

Foreign research and development ITC credits
429

 
370

Other
159

 
104

Total deferred tax assets
2,950

 
2,758

Less: valuation allowance
(2,743
)
 
(2,580
)
Total deferred tax assets, net of valuation allowance
207

 
178

Deferred tax liabilities:
 
 
 
Discount of convertible notes
(22
)
 
(54
)
Undistributed foreign earnings
(110
)
 
(105
)
Other
(64
)
 
(15
)
Total deferred tax liabilities
(196
)
 
(174
)
Net deferred tax assets
$
11

 
$
4



The breakdown between deferred tax assets and deferred tax liabilities as of December 28, 2019 and December 29, 2018 is as follows:
 
December 28,
2019
 
December 29,
2018
 
(In millions)
Deferred tax assets
$
22

 
$
15

Deferred tax liabilities
(11
)
 
(11
)
Net deferred tax assets
$
11

 
$
4


 
Schedule of Unrecognized Tax Benefits Roll Forward
A reconciliation of the Company's gross unrecognized tax benefits is as follows:
 
2019
 
2018
 
2017
 
(In millions)
Balance at beginning of year
$
49

 
$
49

 
$
42

Increases for tax positions taken in prior years
5

 
1

 
7

Decreases for tax positions taken in prior years
—

 
(1
)
 
(2
)
Increases for tax positions taken in the current year
15

 
3

 
3

Decreases for settlements with taxing authorities
(3
)
 
(2
)
 
—

Decreases for lapsing of the statute of limitations
(1
)
 
(1
)
 
(1
)
Balance at end of year
$
65

 
$
49

 
$
49