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Composition of Certain Financial Statement Items | 12 Months Ended
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Sep. 29, 2024
Balance Sheet Related Disclosures [Abstract] |
Composition of Certain Financial Statement Items | Composition of Certain Financial Statement Items
Accounts Receivable (in millions) |  |  |
| September 29, 2024 |  | September 24, 2023
Trade, net of allowances for doubtful accounts | $ | 2,347 |  |  | $ | 1,923 |
Unbilled | 1,546 |  |  | 1,223 |
Other | 36 |  |  | 37 |
| $ | 3,929 |  |  | $ | 3,183 |
Inventories (in millions) |  |  |
| September 29, 2024 |  | September 24, 2023
Raw materials | $ | 340 |  |  | $ | 176 |
Work-in-process | 3,497 |  |  | 4,096 |
Finished goods | 2,586 |  |  | 2,150 |
| $ | 6,423 |  |  | $ | 6,422 |
Property, Plant and Equipment (in millions) |  |  |
| September 29, 2024 |  | September 24, 2023
Land | $ | 169 |  |  | $ | 169 |
Buildings and improvements | 1,888 |  |  | 1,849 |
Computer equipment and software | 2,022 |  |  | 1,773 |
Machinery and equipment | 8,647 |  |  | 8,078 |
Furniture and office equipment | 139 |  |  | 130 |
Leasehold improvements | 550 |  |  | 485 |
Construction in progress | 126 |  |  | 226 |
| 13,541 |  |  | 12,710 |
Less accumulated depreciation and amortization | (8,876) |  |  | (7,668) |
| $ | 4,665 |  |  | $ | 5,042 |
Depreciation and amortization expense related to property, plant and equipment for fiscal 2024, 2023 and 2022 was $1.4 billion, $1.4 billion and $1.3 billion, respectively. Goodwill and Other Intangible Assets. We allocate goodwill to our reporting units for impairment testing purposes. The following table presents the goodwill allocated to our segments, as described in Note 8, as well as the changes in the carrying amounts of goodwill during fiscal 2024 and 2023 (in millions):
|  | QCT |  | QTL |  |  |  | Total
Balance at September 25, 2022 |  | $ | 9,777 |  |  | $ | 731 |  |  |  |  | $ | 10,508 |
Acquisitions |  | 76 |  |  | — |  |  |  |  | 76 |
Foreign currency translation adjustments |  | 56 |  |  | 2 |  |  |  |  | 58 |
Balance at September 24, 2023 (1) |  | 9,909 |  |  | 733 |  |  |  |  | 10,642 |
Acquisitions |  | 126 |  |  | — |  |  |  |  | 126 |
Foreign currency translation adjustments |  | 30 |  |  | 1 |  |  |  |  | 31 |
Balance at September 29, 2024 (1) |  | $ | 10,065 |  |  | $ | 734 |  |  |  |  | $ | 10,799 |
(1) Cumulative goodwill impairments were $812 million at both September 29, 2024 and September 24, 2023. The components of other intangible assets, net were as follows (in millions):
| September 29, 2024 |  | September 24, 2023
| Gross Carrying Amount |  | Accumulated Amortization |  | Weighted-average amortization period (years) |  | Gross Carrying Amount |  | Accumulated Amortization |  | Weighted-average amortization period (years)
Technology-based | $ | 2,498 |  |  | $ | (1,275) |  |  | 9 |  | $ | 4,292 |  |  | $ | (2,912) |  |  | 12
Other | 69 |  |  | (48) |  |  | 11 |  | 70 |  |  | (42) |  |  | 11
| $ | 2,567 |  |  | $ | (1,323) |  |  | 9 |  | $ | 4,362 |  |  | $ | (2,954) |  |  | 11
All of these intangible assets are subject to amortization, other than acquired in-process research and development which had a carrying value of $188 million and $435 million at September 29, 2024 and September 24, 2023, respectively. Amortization expense related to these intangible assets was $311 million, $418 million and $482 million for fiscal 2024, 2023 and 2022, respectively. At September 29, 2024, amortization expense related to other intangible assets, including acquired in-process research and development beginning upon the completion of the underlying projects, is expected to be $290 million, $274 million, $187 million, $156 million and $129 million for each of the five years from fiscal 2025 through 2029, respectively, and $208 million thereafter. Equity Method and Non-marketable Equity Investments. The carrying values of our equity method and non-marketable equity investments are recorded in other assets and were as follows (in millions):
| September 29, 2024 |  | September 24, 2023
Equity method investments | $ | 154 |  |  | $ | 164 |
Non-marketable equity investments (1) | 1,187 |  |  | 1,072 |
| $ | 1,341 |  |  | $ | 1,236 |
(1) Cumulative unrealized gains were $370 million and $241 million at September 29, 2024 and September 24, 2023, respectively. Cumulative unrealized losses, including impairments, were $385 million and $335 million at September 29, 2024 and September 24, 2023, respectively.
Other Current Liabilities (in millions) |  |  |
| September 29, 2024 |  | September 24, 2023
Customer incentives and other customer-related liabilities | $ | 2,480 |  |  | $ | 1,821 |
Income taxes payable | 1,080 |  |  | 1,717 |
Other | 865 |  |  | 953 |
| $ | 4,425 |  |  | $ | 4,491 |
Revenues. We disaggregate our revenues by segment (Note 8), by products and services (as presented on our consolidated statements of operations), and for our QCT segment, by revenue stream, which is based on the industry and application in which our products are sold (as presented below). In certain cases, the determination of QCT revenues by industry and application requires the use of certain assumptions. Substantially all of QCT’s revenues consist of equipment revenues that are recognized at a point in time, and substantially all of QTL’s revenues represent licensing revenues that are recognized over time and are principally from royalties generated through our licensees’ sales of mobile handsets. QCT revenue streams were as follows (in millions):
|  |  |  |  | 2024 |  | 2023 |  | 2022
Handsets (1) |  |  |  |  |  |  |  |  | $ | 24,863 |  |  | $ | 22,570 |  |  | $ | 28,815 |
Automotive (2) |  |  |  |  |  |  |  |  | 2,910 |  |  | 1,872 |  |  | 1,509 |
IoT (internet of things) (3) |  |  |  |  |  |  |  |  | 5,423 |  |  | 5,940 |  |  | 7,353 |
Total QCT revenues |  |  |  |  |  |  |  |  | $ | 33,196 |  |  | $ | 30,382 |  |  | $ | 37,677 |
(1) Includes revenues from products sold for use in mobile handsets. (2) Includes revenues from products sold for use in automobiles, including connectivity, digital cockpit and ADAS/AD. (3) Primarily includes products sold for use in the following industries and applications: consumer (including PCs, tablets, voice and music and XR), edge networking (including mobile broadband and wireless access points) and industrial (including handhelds, retail, tracking and logistics and utilities). Revenues recognized from performance obligations satisfied (or partially satisfied) in previous periods generally include certain QCT sales-based royalty revenues related to system software, certain amounts related to QCT customer incentives and QTL royalty revenues recognized related to devices sold in prior periods (including adjustments to prior period royalty estimates, which includes the impact of the reporting by our licensees of actual royalties due) and were as follows (in millions):
| 2024 |  | 2023 |  | 2022
Revenues recognized from previously satisfied performance obligations | $ | 558 |  |  | $ | 598 |  |  | $ | 788 |
Unearned revenues (which are considered contract liabilities) consist primarily of certain customer contracts for which QCT received fees upfront and QTL license fees for intellectual property with continuing performance obligations (substantially all of which were recognized prior to fiscal 2024). In fiscal 2024 and fiscal 2023, we recognized revenues of $312 million and $355 million, respectively, that were recorded as unearned revenues at September 24, 2023 and September 25, 2022, respectively. Remaining performance obligations, which are primarily included in unearned revenues (as presented on our consolidated balance sheet), represent the aggregate amount of the transaction price of certain customer contracts yet to be recognized as revenues as of the end of the reporting period and exclude revenues related to (a) contracts that have an original expected duration of one year or less and (b) sales-based royalties (i.e., future royalty revenues) pursuant to our license agreements. Our patent license agreements with key OEMs are generally long-term, with terms expiring at varying dates between fiscal 2025 and 2031. We generally seek to renew or renegotiate such license agreements prior to expiration. Concentrations. A significant portion of our revenues are concentrated with a small number of customers/licensees of our QCT and QTL (Qualcomm Technology Licensing) segments. The comparability of customer/licensee concentrations for the periods presented are impacted by the timing of customer/licensees device launches and/or innovation cycles and other seasonal trends, among other fluctuations in demand. Revenues from each customer/licensee that were 10% or greater of total revenues were as follows:
| September 29, 2024 |  | September 24, 2023 |  | September 25, 2022
Customer/licensee (x) | 22 | % |  | 27 | % |  | 21 | %
Customer/licensee (y) | 19 |  |  | 21 |  |  | 21 |
Customer/licensee (z) | 12 |  |  | * |  | *
* Less than 10% We rely on sole- or limited-source suppliers for some products, particularly products in our QCT segment, subjecting us to possible shortages of raw materials or manufacturing capacity. The loss of a supplier or the inability of a supplier to meet performance or quality specifications or delivery schedules could harm our ability to meet our delivery obligations and/or negatively impact our revenues, business operations and ability to compete for future business. Other Income, Costs and Expenses. Other expenses in fiscal 2024 consisted primarily of restructuring and restructuring-related charges (substantially all of which related to severance costs) and a charge related to the settlement of the securities class action lawsuit (Note 7). Other expenses in fiscal 2023 consisted of $712 million in total restructuring and restructuring-related charges (substantially all of which related to severance costs, resulting from certain cost reduction actions committed to in fiscal 2023) and a $150 million intangible asset impairment charge related to in-process research and development. In the third quarter of fiscal 2022, the General Court of the European Union issued a ruling annulling a decision made by the European Commission (EC) in fiscal 2018. As a result of the court’s decision, we recorded a $1.1 billion benefit to other income in fiscal 2022 resulting from the reversal of the previously accrued EC fine. Discontinued Operations. In fiscal 2022, we and SSW Partners, a New York-based investment partnership, entered into and closed a definitive agreement to acquire Veoneer, Inc. (Veoneer). Total cash consideration paid in the transaction was $4.7 billion. We acquired Veoneer’s Arriver business and SSW Partners retained Veoneer’s Tier-1 automotive supplier businesses, primarily consisting of the Active Safety and the Restraint Control Systems businesses (the Non-Arriver businesses), with the intent to sell such businesses in multiple transactions. In exchange for us funding substantially all of the cash consideration payable in the transaction, we obtained the right to receive a majority of the proceeds upon the sale of the Non-Arriver businesses by SSW Partners. On June 1, 2023, SSW Partners completed the sale of Veoneer’s Active Safety business to Magna International Inc. for net cash proceeds of $1.5 billion. On March 1, 2024, SSW Partners completed the sale of Veoneer’s Restraint Control Systems (RCS) business to American Industrial Partners Capital Fund VII. Although we did not own or operate the Non-Arriver businesses, we were the primary beneficiary, within the meaning of the FASB accounting guidance related to consolidation (ASC 810), of these businesses under the variable interest model, until sold by SSW. Factors considered in reaching this conclusion included, among others: (i) our involvement in the design of and our funding of substantially all of the total cash consideration payable in the transaction and (ii) our obligation to absorb losses and rights to receive returns from the Non-Arriver businesses. Accordingly, through the date of disposition by SSW Partners, the assets and liabilities of the Non-Arriver businesses have been consolidated and presented as held for sale on our consolidated balance sheets, and the operating results (including the gain or loss on sale, the amounts of which were not material) have been presented as discontinued operations. Also, the cash flows provided (used) by the Non-Arriver businesses are reflected separately as discontinued operations, with the cash proceeds from the sale of the Active Safety and RCS businesses presented as investing activities.
Investment and Other Income (Expense), Net (in millions) |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  | 2024 |  | 2023 |  | 2022
Interest and dividend income |  |  |  |  |  |  |  | $ | 675 |  |  | $ | 313 |  |  | $ | 91 |
Net gains (losses) on marketable securities |  |  |  |  |  |  |  | 14 |  |  | 75 |  |  | (363) |
Net gains on other investments |  |  |  |  |  |  |  | 175 |  |  | 21 |  |  | 113 |
Net gains (losses) on deferred compensation plan assets |  |  |  |  |  |  |  | 198 |  |  | 86 |  |  | (141) |
Impairment losses on other investments |  |  |  |  |  |  |  | (79) |  |  | (132) |  |  | (47) |
Other |  |  |  |  |  |  |  | (21) |  |  | (14) |  |  | (25) |
|  |  |  |  |  |  |  | $ | 962 |  |  | $ | 349 |  |  | $ | (372) |

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