Intel 1998 Annual Report Download - page 55

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products include chipsets, embedded processors (including embedded Pentium-Registered Trademark- processors), microcontrollers, flash
memory products and graphics products. The Network Communications Group's products include fast Ethernet connections, hubs, switches and
routers. The New Business Group's products include systems management software, digital imaging products, and video and data conferencing
products. Intel's products in all operating groups are sold directly to original equipment manufacturers, retail and industrial distributors, and
resellers throughout the world.
In addition to the aforementioned operating segments, the sales and marketing, manufacturing, finance and administration groups also report to
the CEO. Expenses of these groups are allocated to the operating segments and are included in the operating results reported below. Certain
corporate-level operating expenses (primarily profit-dependent bonus expenses) and reserves for deferred income on shipments to distributors
are not allocated to operating segments and are included in "all other" in the reconciliation of operating profits reported below.
Although the Company has four operating segments, only the Intel Architecture Business Group and Computing Enhancement Group are
reportable segments under the criteria of SFAS No. 131. Intel does not identify or allocate assets or depreciation by operating segment, nor
does the CEO evaluate groups on these criteria. Operating segments do not sell products to each other, and accordingly, there are no
intersegment revenues to be reported. Intel does not allocate interest and other income, interest expense or taxes to operating segments. The
accounting policies for segment reporting are the same as for the Company as a whole (see "Accounting policies").
Information on reportable segments for the three years ended December 26, 1998 is as follows:
In 1998, one customer accounted for 13% of the Company's revenues and another customer accounted for 11%. In 1997, one customer
accounted for 12% of the Company's revenues. In 1996, no customer exceeded 10% of the Company's revenues. A substantial majority of the
sales to these customers were Intel Architecture Business Group products, but these customers also purchased Computing Enhancement Group
products.
Enterprise-wide information is provided in accordance with SFAS No. 131. Geographic revenue information for the three years ended
December 26, 1998 is based on the location of the selling entity. Property, plant and equipment information is based on the physical location of
the assets at the end of each of the fiscal years.
Revenues from unaffiliated customers by geographic region were as follows:
Net property, plant and equipment by country was as follows:
(IN MILLIONS) 1998 1997 1996
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INTEL ARCHITECTURE BUSINESS GROUP
Revenues $21,545 $20,782 $17,000
Operating profit $ 9,077 $10,659 $ 7,666
COMPUTING ENHANCEMENT GROUP
Revenues $ 4,047 $ 3,793 $ 3,622
Operating profit $ 358 $ 529 $ 940
ALL OTHER
Revenues $ 681 $ 495 $ 225
Operating (loss) $(1,056) $(1,301) $(1,053)
TOTAL
Revenues $26,273 $25,070 $20,847
Operating profit $ 8,379 $ 9,887 $ 7,553
(IN MILLIONS) 1998 1997 1996
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United States $11,663 $11,053 $ 8,668
Europe 7,452 6,774 5,876
Asia-Pacific 5,309 4,754 3,844
Japan 1,849 2,489 2,459
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TOTAL REVENUES $26,273 $25,070 $20,847
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(IN MILLIONS) 1998 1997
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United States $ 8,076 $ 8,022
Ireland 1,287 919
Other foreign countries 2,246 1,725
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TOTAL PROPERTY, PLANT AND EQUIPMENT, NET $11,609 $10,666
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