Advanced Micro Devices, Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Income Taxes (Tables)

Income Taxes (Tables)

12 Months Ended

Dec. 30, 2017

The provision for income taxes consists of:



	2017			2016			2015
	(In millions)
Current:
U.S. Federal	$	(3	)	$	(2	)	$	(1	)
U.S. State and Local	—			—			—
Foreign National and Local	38			21			16
Total	35			19			15
Deferred:
U.S. Federal	(15		)	(1		)	—
Foreign National and Local	(1		)	21			(1		)
Total	(16		)	20			(1		)
Provision for income taxes	$	19		$	39		$	14

Schedule of Loss before Income Tax

Income (loss) before income taxes consists of the following:



	2017			2016			2015
	(In millions)
U.S.	$	108		$	(604	)	$	(1,100	)
Foreign	(46		)	146			454
Total pre-tax income (loss) including equity loss in investee	$	62		$	(458	)	$	(646	)

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 30, 2017 and December 31, 2016 are as follows:



	December 30, 2017			December 31, 2016
	(In millions)
Deferred tax assets:
Net operating loss carryovers	$	1,551		$	2,480
Deferred distributor income	7			26
Inventory valuation	20			26
Accrued expenses not currently deductible	61			65
Acquired intangibles	102			213
Tax deductible goodwill	56			146
Federal and state tax credit carryovers	546			427
Foreign research and development ITC credits	391			341
Other	55			83
Total deferred tax assets	2,789			3,807
Less: valuation allowance	(2,621		)	(3,526		)
Total deferred tax assets, net of valuation allowance	168			281
Deferred tax liabilities:
Discount of convertible notes	(58		)	(105		)
Undistributed foreign earnings	(97		)	(158		)
Other	(13		)	(18		)
Total deferred tax liabilities	(168		)	(281		)
Net deferred tax assets	$	—		$	—

Schedule of Deferred Tax Assets and Liabilities, Current and Noncurrent

The breakdown between current and non-current deferred tax assets and deferred tax liabilities as of December 30, 2017 and December 31, 2016 is as follows:



	December 30, 2017			December 31, 2016
	(In millions)
Current deferred tax assets	$	—		$	—
Non-current deferred tax assets	11			11
Current deferred tax liabilities	—			—
Non-current deferred tax liabilities	$	(11	)	$	(11	)
Net deferred tax assets	$	—		$	—

Summary of Tax Attribute Carryforwards

The following is a summary of the Company’s various tax attribute carryforwards as of December 30, 2017.



Carryforward	Federal		State / Provincial		Expiration
	(In millions)
U.S.-net operating loss carryovers	$	7,254	$	309	2018 to 2037
U.S.-credit carryovers	$	394	$	213	2018 to 2037
Canada-credit carryovers	$	369	$	42	2021 to 2037
Other foreign net operating loss carryovers	$	37	N/A		various

Schedule of Effective Income Tax Rate Reconciliation

The table below displays reconciliation between statutory federal income taxes and the total provision (benefit) for income taxes.



	2017			2016			2015
	(In millions)
Statutory federal income tax expense (benefit) at 35% rate	$	22		$	(160	)	$	(226	)
State taxes, net of federal benefit	1			1			1
Foreign (income) expense at other than U.S. rates	—			(1		)	9
U.S. valuation allowance generated	16			201			232
Credit monetization	(20		)	(2		)	(2		)
Provision for income taxes	$	19		$	39		$	14

Schedule of Unrecognized Tax Benefits Roll Forward

A reconciliation of the gross unrecognized tax benefits is as follows:



	2017			2016			2015
	(In millions)
Balance at beginning of year	$	42		$	38		$	28
Increases for tax positions taken in prior years	7			3			11
Decreases for tax positions taken in prior years	(2		)	—			(1		)
Increases for tax positions taken in the current year	3			2			2
Decreases for settlements with taxing authorities	—			—			(2		)
Decreases for lapsing of the statute of limitations	(1		)	(1		)	—
Balance at end of year	$	49		$	42		$	38