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Available-for-Sale Debt Investments and Equity Investments | 3 Months Ended
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Oct. 27, 2018
Investments, Debt and Equity Securities [Abstract] |
Available-for-Sale Debt Investments and Equity Investments | Available-for-Sale Debt Investments and Equity Investments The following table summarizes our available-for-sale debt investments and equity investments (in millions):
| October 27, 2018 |  | July 28, 2018
Available-for-sale debt investments | $ | 34,183 |  |  | $ | 37,009 |
Marketable equity securities | — |  |  | 605 |
Total investments | 34,183 |  |  | 37,614 |
Non-marketable equity securities included in other assets | 1,125 |  |  | 978 |
Equity method investments included in other assets | 115 |  |  | 118 |
Total | $ | 35,423 |  |  | $ | 38,710 |
(a) | Summary of Available-for-Sale Debt Investments
The following tables summarize our available-for-sale debt investments (in millions):
October 27, 2018 | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
U.S. government securities | $ | 5,783 |  |  | $ | — |  |  | $ | (29 | ) |  | $ | 5,754 |
U.S. government agency securities | 434 |  |  | — |  |  | (4 | ) |  | 430 |
Non-U.S. government and agency securities | 153 |  |  | — |  |  | — |  |  | 153 |
Corporate debt securities | 26,444 |  |  | 33 |  |  | (446 | ) |  | 26,031 |
U.S. agency mortgage-backed securities | 1,481 |  |  | — |  |  | (60 | ) |  | 1,421 |
Commercial paper | 309 |  |  | — |  |  | — |  |  | 309 |
Certificates of deposit | 85 |  |  | — |  |  | — |  |  | 85 |
Total (1) | $ | 34,689 |  |  | $ | 33 |  |  | $ | (539 | ) |  | $ | 34,183 |
July 28, 2018 | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value
U.S. government securities | $ | 7,318 |  |  | $ | — |  |  | $ | (43 | ) |  | $ | 7,275 |
U.S. government agency securities | 732 |  |  | — |  |  | (5 | ) |  | 727 |
Non-U.S. government and agency securities | 209 |  |  | — |  |  | (1 | ) |  | 208 |
Corporate debt securities | 27,765 |  |  | 44 |  |  | (445 | ) |  | 27,364 |
U.S. agency mortgage-backed securities | 1,488 |  |  | — |  |  | (53 | ) |  | 1,435 |
Total (1) | $ | 37,512 |  |  | $ | 44 |  |  | $ | (547 | ) |  | $ | 37,009 |
(1) Net unsettled investment purchases were $1 million and net unsettled investment sales were $1.5 billion as of October 27, 2018 and July 28, 2018, respectively and were included in other current assets and other current liabilities. Non-U.S. government and agency securities include agency and corporate debt securities that are guaranteed by non-U.S. governments. The following table presents the gross realized gains and gross realized losses related to available-for-sale debt investments (in millions):
| Three Months Ended
| October 27, 2018 |  | October 28, 2017
Gross realized gains | $ | 2 |  |  | $ | 8 |
Gross realized losses | (8 | ) |  | (4 | )
Total | $ | (6 | ) |  | $ | 4 |
The following tables present the breakdown of the available-for-sale debt investments with gross unrealized losses and the duration that those losses had been unrealized at October 27, 2018 and July 28, 2018 (in millions):
| UNREALIZED LOSSES LESS THAN 12 MONTHS |  | UNREALIZED LOSSES 12 MONTHS OR GREATER |  | TOTAL
October 27, 2018 | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses
U.S. government securities | $ | 516 |  |  | $ | (3 | ) |  | $ | 5,231 |  |  | $ | (26 | ) |  | $ | 5,747 |  |  | $ | (29 | )
U.S. government agency securities | 4 |  |  | — |  |  | 427 |  |  | (4 | ) |  | 431 |  |  | (4 | )
Non-U.S. government and agency securities | — |  |  | — |  |  | 153 |  |  | — |  |  | 153 |  |  | — |
Corporate debt securities | 13,483 |  |  | (257 | ) |  | 6,738 |  |  | (189 | ) |  | 20,221 |  |  | (446 | )
U.S. agency mortgage-backed securities | 456 |  |  | (12 | ) |  | 947 |  |  | (48 | ) |  | 1,403 |  |  | (60 | )
Total | $ | 14,459 |  |  | $ | (272 | ) |  | $ | 13,496 |  |  | $ | (267 | ) |  | $ | 27,955 |  |  | $ | (539 | )
| UNREALIZED LOSSES LESS THAN 12 MONTHS |  | UNREALIZED LOSSES 12 MONTHS OR GREATER |  | TOTAL
July 28, 2018 | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses |  | Fair Value |  | Gross Unrealized Losses
U.S. government securities | $ | 2,966 |  |  | $ | (20 | ) |  | $ | 4,303 |  |  | $ | (23 | ) |  | $ | 7,269 |  |  | $ | (43 | )
U.S. government agency securities | 206 |  |  | (2 | ) |  | 521 |  |  | (3 | ) |  | 727 |  |  | (5 | )
Non-U.S. government and agency securities | 105 |  |  | (1 | ) |  | 103 |  |  | — |  |  | 208 |  |  | (1 | )
Corporate debt securities | 16,990 |  |  | (344 | ) |  | 3,511 |  |  | (101 | ) |  | 20,501 |  |  | (445 | )
U.S. agency mortgage-backed securities | 826 |  |  | (24 | ) |  | 581 |  |  | (29 | ) |  | 1,407 |  |  | (53 | )
Total | $ | 21,093 |  |  | $ | (391 | ) |  | $ | 9,019 |  |  | $ | (156 | ) |  | $ | 30,112 |  |  | $ | (547 | )
During the first quarter of fiscal 2019 and fiscal 2018, respectively, we did not recognize any impairment charges on our available-for-sale debt investments. For available-for-sale debt investments that were in an unrealized loss position as of October 27, 2018, we have determined that no other-than-temporary impairments were required to be recognized. The following table summarizes the maturities of our available-for-sale debt investments as of October 27, 2018 (in millions):
| Amortized Cost |  | Fair Value
Within 1 year | $ | 12,283 |  |  | $ | 12,243 |
After 1 year through 5 years | 19,248 |  |  | 18,922 |
After 5 years through 10 years | 1,662 |  |  | 1,581 |
After 10 years | 15 |  |  | 16 |
Mortgage-backed securities with no single maturity | 1,481 |  |  | 1,421 |
Total | $ | 34,689 |  |  | $ | 34,183 |
Actual maturities may differ from the contractual maturities because borrowers may have the right to call or prepay certain obligations.
(b) | Summary of Equity Investments
We recorded adjustments to the carrying value of our non-marketable equity securities measured using the measurement alternative in the first quarter of fiscal 2019 as follows (in millions):
| Three Months Ended
| October 27, 2018
Adjustments to non-marketable equity securities measured using the measurement alternative: |
Upward adjustments | $ | 10 |
Downward adjustments, including impairments | (16 | )
Net downward adjustments | $ | (6 | )
Gains and losses recognized on our marketable and non-marketable equity securities for the first quarter of fiscal 2019 are summarized below (in millions):
| Three Months Ended
| October 27, 2018
Net gains and losses recognized during the period on equity investments | $ | 8 |
Less: Net gains and losses recognized on equity investments sold | (12 | )
Unrealized gains and losses recognized during reporting period on equity securities still held at the reporting date | $ | (4 | )
(c) | Securities Lending
We periodically engage in securities lending activities with certain of our available-for-sale debt investments. These transactions are accounted for as a secured lending of the securities, and the securities are typically loaned only on an overnight basis. The average daily balance of securities lending was $0.5 billion as of each of the first quarters of fiscal 2019 and fiscal 2018, respectively. We require collateral equal to at least 102% of the fair market value of the loaned security and that the collateral be in the form of cash or liquid, high-quality assets. We engage in these secured lending transactions only with highly creditworthy counterparties, and the associated portfolio custodian has agreed to indemnify us against collateral losses. We did not experience any losses in connection with the secured lending of securities during the periods presented. As of October 27, 2018 and July 28, 2018, we had no outstanding securities lending transactions.
(d) | Variable Interest Entities
In the ordinary course of business, we have investments in privately held companies and provide financing to certain customers. These privately held companies and customers may be considered to be variable interest entities. We evaluate on an ongoing basis our investments in these privately held companies and our customer financings, and have determined that as of October 27, 2018, except as disclosed in Note 1, there were no significant variable interest entities required to be consolidated in our Consolidated Financial Statements. As of October 27, 2018, the carrying value of our non-marketable equity securities was $1.2 billion, of which $670 million of such investments are considered to be in variable interest entities which are unconsolidated. In addition, we have additional funding commitments of $204 million related to these investments, some of which are based on the achievement of certain agreed-upon milestones, and some of which are required to be funded on demand. The carrying value of these investments and the additional funding commitments collectively represent our maximum exposure related to these variable interest entities.

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- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2209399 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 946 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2324412 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -URI http://asc.fasb.org/topic&trid=2196928 Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 940 -SubTopic 320 -URI http://asc.fasb.org/subtopic&trid=2176304 + Details
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