Restructuring and Exit Costs

6 Months Ended

Dec. 29, 2023

Restructuring and Related Activities [Abstract]

Restructuring and Other, net

The Company recorded restructuring and other, net benefits of $31 million and $29 million for the three and six months ended December 29, 2023, respectively, primarily due to the net gain of $30 million from the sale and leaseback of certain property during the December 2023 quarter. The net proceeds of $34 million were recorded as an investing inflow on the Company’s Condensed Statements of Cash Flows.

For the three and six months ended December 30, 2022, the Company recorded restructuring charges of $81 million and $90 million, respectively. The Company’s restructuring plans are comprised primarily of charges related to workforce reduction costs, including severance and other one-time termination benefits, facilities and other exit costs. All restructuring charges are reported in Restructuring and other, net on the Company’s Condensed Consolidated Statement of Operations.

The Company’s significant restructuring plans are described below.

October 2022 Plan - On October 24, 2022, the Company committed to an October 2022 restructuring plan (the “October 2022 Plan”) to reduce its cost structure to better align the Company’s operational needs to current economic conditions while continuing to support the long-term business strategy. On March 29, 2023, in light of further deteriorating economic conditions, the Company committed to an expansion of the October 2022 Plan to further reduce its global headcount by approximately 480 employees to a total reduction of approximately 3,480 employees. This expanded plan included aligning its business plan to near-term market conditions, along with other cost saving measures. The October 2022 Plan was substantially completed by the end of fiscal year 2023.

April 2023 Plan - On April 20, 2023, the Company committed to an April 2023 restructuring plan (the “April 2023 Plan”) to further reduce its cost structure in response to changes in macroeconomic and business conditions. The April 2023 Plan was intended to align the Company’s operational needs with the near-term demand environment while continuing to support the long-term business strategy. The April 2023 Plan was substantially completed by the end of fiscal year 2023.

The following table summarizes the Company’s restructuring activities under its active restructuring plans:


	April 2023 Plan				October 2022 Plan				Other Plans
(Dollars in millions)	Workforce Reduction Costs		Facilities and Other Exit Costs		Workforce Reduction Costs		Facilities and Other Exit Costs		Workforce Reduction Costs		Facilities and Other Exit Costs		Total
Accrual balances at June 30, 2023	$	108	$	—	$	1	$	5	$	1	$	4	$	119
Restructuring charges	—		—		—		—		3		—		3
Cash payments	(104)		—		(1)		(1)		(4)		—		(110)
Adjustments	(1)		—		—		(1)		—		—		(2)
Accrual balances at December 29, 2023	$	3	$	—	$	—	$	3	$	—	$	4	$	10
Total costs incurred inception to date as of December 29, 2023	$	144	$	3	$	104	$	5	$	66	$	13	$	335
Total expected charges to be incurred as of December 29, 2023	$	—	$	—	$	—	$	—	$	—	$	—	$	—

Of the accrued restructuring balance of $10 million at December 29, 2023, $9 million was included in Accrued expenses and $1 million was included in Other non-current liabilities in the Company’s Condensed Consolidated Balance Sheets. Of the accrued restructuring balance of $119 million at June 30, 2023, $117 million was included in Accrued expenses and $2 million was included in Other non-current liabilities in the Company’s Condensed Consolidated Balance Sheets.