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Financial Instruments | 9 Months Ended
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Sep. 29, 2018
Investments, Debt and Equity Securities [Abstract] |
Financial Instruments | Financial Instruments Cash, Cash Equivalents, and Marketable Securities Cash and financial instruments measured and recorded at fair value as of September 29, 2018 and December 30, 2017 are summarized below:
| Total Fair Value |  | Cash and Cash Equivalents |  | Short-Term Marketable Securities
| (In millions)
September 29, 2018 |  |  |  |  |
Cash | $ | 92 |  |  | $ | 92 |  |  | $ | — |
Level 1(1) (2) |  |  |  |  |
Government money market funds | $ | 205 |  |  | $ | 205 |  |  | $ | — |
Total level 1 | $ | 205 |  |  | $ | 205 |  |  | $ | — |
Level 2(1) (3) |  |  |  |  |
Commercial paper | $ | 759 |  |  | $ | 749 |  |  | $ | 10 |
Total level 2 | $ | 759 |  |  | $ | 749 |  |  | $ | 10 |
Total | $ | 1,056 |  |  | $ | 1,046 |  |  | $ | 10 |
| Total Fair Value |  | Cash and Cash Equivalents
| (In millions)
December 30, 2017 |  |  |
Cash | $ | 108 |  |  | $ | 108 |
Level 1(1) (2) |  |  |
Government money market funds | $ | 395 |  |  | $ | 395 |
Total level 1 | $ | 395 |  |  | $ | 395 |
Level 2(1) (3) |  |  |
Commercial paper | $ | 682 |  |  | $ | 682 |
Total level 2 | $ | 682 |  |  | $ | 682 |
Total | $ | 1,185 |  |  | $ | 1,185 |
(1) | The Company did not have any transfers between Level 1 and Level 2 of the fair value hierarchy during the three and nine months ended September 29, 2018 or the year ended December 30, 2017.
(2) | The Company’s Level 1 assets are valued using quoted prices for identical instruments in active markets.
(3) | The Company’s Level 2 assets are valued using broker reports that utilize quoted prices for identical instruments in markets that are not active or comparable instruments in active markets. Brokers gather observable inputs for all of the Company’s fixed income securities from a variety of industry data providers and other third-party sources.
In addition to those amounts presented above, as of September 29, 2018 and December 30, 2017, the Company had approximately $5 million and $2 million, respectively, of investments in government money market funds, used as collateral for letters of credit deposits, which were included in Other current assets on the Company’s condensed consolidated balance sheets. These government money market funds are classified within Level 1 because they are valued using quoted prices for identical instruments in active markets. Their amortized cost approximates the fair value for all periods presented. As of September 29, 2018 and December 30, 2017, the Company also had approximately $22 million and $18 million, respectively, of investments in mutual funds held in a Rabbi trust established for the Company’s deferred compensation plan, which were included in Other assets on the Company’s condensed consolidated balance sheets. These mutual funds are classified within Level 1 because they are valued using quoted prices for identical instruments in active markets. Their amortized cost approximates the fair value for all periods presented. The Company is restricted from accessing these investments. As of both September 29, 2018 and December 30, 2017, the Company had the carrying value of approximately $3 million in cost method investments. Financial Instruments Not Recorded at Fair Value on a Recurring Basis. The Company carries its financial instruments at fair value with the exception of its debt. Financial instruments that are not recorded at fair value are measured at fair value on a quarterly basis for disclosure purposes. The carrying amounts and estimated fair values of financial instruments not recorded at fair value are as follows:
| September 29, 2018 |  | December 30, 2017
| Carrying Amount |  | Estimated Fair Value |  | Carrying Amount |  | Estimated Fair Value
| (In millions)
Short-term debt | $ | 136 |  |  | $ | 137 |  |  | $ | 70 |  |  | $ | 70 |
Long-term debt, net(1) | $ | 1,167 |  |  | $ | 3,830 |  |  | $ | 1,324 |  |  | $ | 2,103 |
(1) | Carrying amounts of long-term debt are net of unamortized debt issuance costs of $17 million as of September 29, 2018 and $19 million as of December 30, 2017, and net of unamortized debt discount associated with the 2.125% Notes of $268 million as of September 29, 2018 and $286 million as of December 30, 2017.
The Company’s long-term debt is classified within Level 2. The fair value of the debt was estimated based on the quoted market prices for the same or similar issues or on the current rates offered to the Company for debt of the same remaining maturities. The fair value of the Company’s accounts receivable, accounts payable and other short-term obligations approximate their carrying value based on existing payment terms. Hedging Transactions and Derivative Financial Instruments Cash Flow Hedges and Foreign Currency Forward Contracts not Designated as Hedges The following table shows the amount of gains (losses) included in accumulated other comprehensive income (loss), the amount of gains (losses) reclassified from accumulated other comprehensive income (loss) and included in earnings related to foreign currency forward contracts designated as cash flow hedges and the amount of gains (losses) included in other income (expense), net, related to contracts not designated as hedging instruments which was allocated in the consolidated statements of operations:
| Three Months Ended |  | Nine Months Ended
| September 29, 2018 |  | September 30, 2017 |  | September 29, 2018 |  | September 30, 2017
| (In millions)
Foreign Currency Forward Contracts - gains (losses) |  |  |  |  |  |  |
Contracts designated as cash flow hedging instruments |  |  |  |  |  |  |
Other comprehensive income (loss) | $ | — |  |  | $ | 1 |  |  | $ | (16 | ) |  | $ | 8 |
Research and development | (4 | ) |  | 3 |  |  | — |  |  | 4 |
Marketing, general and administrative | (1 | ) |  | 1 |  |  | — |  |  | 1 |
Contracts not designated as hedging instruments |  |  |  |  |  |  |
Other income (expense), net | $ | — |  |  | $ | (2 | ) |  | $ | (2 | ) |  | $ | (3 | )
The Company’s foreign currency derivative contracts are classified within Level 2 because the valuation inputs are based on quoted prices and market observable data of similar instruments in active markets, such as currency spot and forward rates. The following table shows the fair value amounts included in Other current assets should the foreign currency forward contracts be in a gain position or included in Other current liabilities should these contracts be in a loss position. These amounts were recorded in the Company’s condensed consolidated balance sheets as follows:
| September 29, 2018 |  | December 30, 2017
| (In millions)
Foreign Currency Forward Contracts - gains (losses) |  |  |
Contracts designated as cash flow hedging instruments | $ | (10 | ) |  | $ | 7 |
For the foreign currency contracts designated as cash flow hedges, the ineffective portions of the hedging relationship and the amounts excluded from the assessment of hedge effectiveness were immaterial. As of September 29, 2018 and December 30, 2017, the notional values of the Company’s outstanding foreign currency forward contracts were $326 million and $300 million, respectively. All the contracts mature within 12 months, and, upon maturity, the amounts recorded in Accumulated other comprehensive income (loss) are expected to be reclassified into earnings. The Company hedges its exposure to the variability in future cash flows for forecasted transactions over a maximum of 12 months.

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- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
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