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Balance Sheet Components | 12 Months Ended
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Jan. 29, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract] |
Balance Sheet Components | Balance Sheet Components Certain balance sheet components are as follows:
| January 29, 2023 |  | January 30, 2022
| (In millions)
Inventories (1): |  |  |
Raw materials | $ | 2,430 |  |  | $ | 791 |
Work in-process | 466 |  |  | 692 |
Finished goods | 2,263 |  |  | 1,122 |
Total inventories | $ | 5,159 |  |  | $ | 2,605 |
(1) In fiscal years 2023 and 2022, we recorded an inventory reserve expense of approximately $1.04 billion and $173 million in cost of revenue, respectively.
| January 29, 2023 |  | January 30, 2022 |  | Estimated Useful Life
| (In millions) |  | (In years)
Property and Equipment: |  |  |  |  |
Land | $ | 218 |  |  | $ | 218 |  |  | (A)
Buildings, leasehold improvements, and furniture | 1,598 |  |  | 874 |  |  | (B)
Equipment, compute hardware, and software | 4,303 |  |  | 2,852 |  |  | 3-5
Construction in process | 382 |  |  | 737 |  |  | (C)
Total property and equipment, gross | 6,501 |  |  | 4,681 |  |  |
Accumulated depreciation and amortization | (2,694) |  |  | (1,903) |  |  |
Total property and equipment, net | $ | 3,807 |  |  | $ | 2,778 |  |  |
(A)Land is a non-depreciable asset. (B)The estimated useful lives of our buildings are up to thirty years. Leasehold improvements and finance leases are amortized based on the lesser of either the asset’s estimated useful life or the expected lease term. (C)Construction in process represents assets that are not available for their intended use as of the balance sheet date. Depreciation expense for fiscal years 2023, 2022, and 2021 was $844 million, $611 million, and $486 million, respectively. Accumulated amortization of leasehold improvements and finance leases was $327 million and $265 million as of January 29, 2023 and January 30, 2022, respectively. Property, equipment and intangible assets acquired by assuming related liabilities during fiscal years 2023, 2022, and 2021 were $374 million, $258 million, and $157 million, respectively.
| January 29, 2023 |  | January 30, 2022
Other assets: | (In millions)
Prepaid supply agreements | $ | 2,989 |  |  | $ | 1,747 |
Prepaid royalties | 387 |  |  | 409 |
Investment in non-affiliated entities | 299 |  |  | 266 |
Advanced consideration for acquisition (1) | — |  |  | 1,353 |
Other | 145 |  |  | 66 |
Total other assets | $ | 3,820 |  |  | $ | 3,841 |
(1)Refer to Note 2 - Business Combination for further details on the Arm acquisition.
| January 29, 2023 |  | January 30, 2022
| (In millions)
Accrued and Other Current Liabilities: |  |  |
Customer program accruals | $ | 1,196 |  |  | $ | 1,000 |
Excess inventory purchase obligations (1) | 954 |  |  | 196 |
Accrued payroll and related expenses | 530 |  |  | 409 |
Taxes payable | 467 |  |  | 132 |
Deferred revenue (2) | 354 |  |  | 300 |
Operating leases | 176 |  |  | 144 |
Other | 443 |  |  | 371 |
Total accrued and other current liabilities | $ | 4,120 |  |  | $ | 2,552 |
(1)In fiscal years 2023 and 2022, we recorded an expense of approximately $1.13 billion and $181 million, respectively, in cost of revenue for inventory purchase obligations in excess of our current demand projections, and cancellation and underutilization penalties. (2)Deferred revenue primarily includes customer advances and deferrals related to license and development arrangements, support for hardware and software, and cloud services.
| January 29, 2023 |  | January 30, 2022
| (In millions)
Other Long-Term Liabilities: |  |  |
Income tax payable (1) | $ | 1,204 |  |  | $ | 980 |
Deferred income tax | 247 |  |  | 245 |
Deferred revenue (2) | 218 |  |  | 202 |
Licenses payable | 181 |  |  | 77 |
Other | 63 |  |  | 49 |
Total other long-term liabilities | $ | 1,913 |  |  | $ | 1,553 |
(1)Income tax payable is comprised of the long-term portion of the one-time transition tax payable, unrecognized tax benefits, and related interest and penalties. (2)Deferred revenue primarily includes deferrals related to support for hardware and software. Deferred Revenue The following table shows the changes in deferred revenue during fiscal years 2023 and 2022.
| January 29, 2023 |  | January 30, 2022
| (In millions)
Balance at beginning of period | $ | 502 |  |  | $ | 451 |
Deferred revenue added during the period | 830 |  |  | 821 |
Addition due to business combinations | — |  |  | 8 |
Revenue recognized during the period | (760) |  |  | (778) |
Balance at end of period | $ | 572 |  |  | $ | 502 |
Revenue related to remaining performance obligations represents the contracted license and development arrangements and support for hardware and software. This includes deferred revenue currently recorded and amounts that will be invoiced in future periods. As of January 29, 2023, $652 million of revenue related to performance obligations had not been recognized, of which we expect to recognize approximately 47% over the next twelve months and the remainder thereafter. This excludes revenue related to performance obligations for contracts with a length of one year or less.

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- Definition The entire disclosure for supplemental balance sheet disclosures, including descriptions and amounts for assets, liabilities, and equity. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -URI https://asc.fasb.org/topic&trid=2122208 + Details
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