Intel 2010 Annual Report Download - page 31

Table of Contents
Our failure to comply with applicable environmental laws and regulations worldwide could harm our business and results
of operations.
The manufacturing and assembling and testing of our products require the use of hazardous materials that are subject to a
broad array of EHS laws and regulations. Our failure to comply with any of those applicable laws or regulations could result
in:
In addition, our failure to manage the use, transportation, emissions, discharge, storage, recycling, or disposal of hazardous
materials could subject us to increased costs or future liabilities. Existing and future environmental laws and regulations could
also require us to acquire pollution abatement or remediation equipment, modify our product designs, or incur other expenses
associated with such laws and regulations. Many new materials that we are evaluating for use in our operations may be subject
to regulation under existing or future environmental laws and regulations that may restrict our use of one or more of such
materials in our manufacturing, assembly and test processes, or products. Any of these restrictions could harm our business
and results of operations by increasing our expenses or requiring us to alter our manufacturing and assembly and test
processes.
Climate change poses both regulatory and physical risks that could harm our results of operations or affect the way we
conduct our business.
In addition to the possible direct economic impact that climate change could have on us, climate change mitigation programs
and regulations can increase our costs. For example, the cost of perfluorocompounds (PFCs), a gas that we use in
manufacturing, could increase over time under some climate-change-
focused emissions trading programs that may be imposed
by government regulation. If the use of PFCs is prohibited, we would need to obtain substitute materials that may cost more or
be less available for our manufacturing operations. In addition, air quality permit requirements for our manufacturing
operations could become more burdensome and cause delays in our ability to modify or build additional manufacturing
capacity. Under the recently adopted greenhouse gas regulations in the U.S., many of our manufacturing facilities will become
“major” sources under the Clean Air Act in 2011. At a minimum, this change in status will result in some uncertainty as the
EPA adopts guidance on implementation of its greenhouse gas regulations. Due to the dynamic nature of our semiconductor
manufacturing operations, it is likely these new regulations will result in increased costs for our U.S. operations. These cost
increases could be associated with new air pollution control requirements, and increased or new monitoring, recordkeeping,
and reporting of greenhouse gas emissions. We also see the potential for higher energy costs driven by climate change
regulations. Our costs could increase if utility companies pass on their costs, such as those associated with carbon taxes,
emission cap and trade programs, or renewable portfolio standards. While we maintain business recovery plans that are
intended to allow us to recover from natural disasters or other events that can be disruptive to our business, we cannot be sure
that our plans will fully protect us from all such disasters or events. Many of our operations are located in semi-arid regions,
such as Israel and the southwestern U.S. Some scenarios predict that these regions may become even more vulnerable to
prolonged droughts due to climate change.
Changes in our effective tax rate may harm our results of operations.
A number of factors may increase our future effective tax rates, including:
Any significant increase in our future effective tax rates could reduce net income for future periods.
Interest and other, net could be impacted by macroeconomic and other factors, harming our results of operations.
Factors that could cause interest and other, net in our consolidated statements of income to fluctuate include:
•
regulatory penalties, fines, and legal liabilities;
•
suspension of production;
•
alteration of our fabrication and assembly and test processes; and
•
curtailment of our operations or sales.
•
the jurisdictions in which profits are determined to be earned and taxed;
•
the resolution of issues arising from tax audits with various tax authorities;
•
changes in the valuation of our deferred tax assets and liabilities, and changes in deferred tax valuation allowances;
•
adjustments to income taxes upon finalization of various tax returns;
• increases in expenses not deductible for tax purposes, including write-offs of acquired in-process research and
development and impairments of goodwill in connection with acquisitions;
•
changes in available tax credits;
• changes in tax laws or the interpretation of such tax laws, including changes in the U.S. to the taxation of foreign
income and expenses;
•
changes in U.S. generally accepted accounting principles; and
•
our decision to repatriate
non
-
U.S.
earnings for which we have not previously provided for U.S. taxes.
•
fixed
-
income, equity, and credit market volatility;
•
fluctuations in foreign currency exchange rates;
•
fluctuations in interest rates;
•
changes in the credit standing of financial instrument counterparties; and
•
changes in our cash and investment balances.