Intel 2014 Annual Report Download - page 48

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (Continued)
Our marketable debt instruments that are measured and recorded at fair value on a recurring basis and classified as Level 3 are
classified as such because the fair values are generally derived from discounted cash flow models, performed either by us or our
pricing providers, using inputs that we are unable to corroborate with observable market data. We monitor and review the inputs
and results of these valuation models to help ensure the fair value measurements are reasonable and consistent with market
experience in similar asset classes.
Loans Receivable and Reverse Repurchase Agreements
As of December 27, 2014, our assets measured and recorded at fair value on a recurring basis included $721 million of loans receivable
and $268 million of reverse repurchase agreements. All of these investments were classified as Level 2, as the fair value is determined
using a discounted cash flow model with all significant inputs derived from or corroborated with observable market data.
Marketable Equity Securities
As of December 27, 2014, our assets measured and recorded at fair value on a recurring basis included $7.1 billion of marketable
equity securities. All of these securities were classified as Level 1 because the valuations were based on quoted prices for
identical securities in active markets. Our assessment of an active market for our marketable equity securities generally takes into
consideration the number of days that each individual equity security trades over a specified period.
Contractual Obligations
Significant contractual obligations as of December 27, 2014 were as follows:
Payments Due by Period
(In Millions) Total
Less Than
1 Year 1–3 Years 3–5 Years
More
Than 5
Years
Operating lease obligations .............................. $ 1,070 $ 205 $ 331 $ 219 $ 315
Capital purchase obligations1............................ 3,482 3,317 165 — —
Other purchase obligations and commitments2............... 2,500 1,390 1,027 83 —
Long-term debt obligations3.............................. 21,942 430 5,330 720 15,462
Other long-term liabilities4, 5 .............................. 1,437 780 416 128 113
Total6............................................... $ 30,431 $ 6,122 $ 7,269 $ 1,150 $ 15,890
1Capital purchase obligations represent commitments for the construction or purchase of property, plant and equipment. They
were not recorded as liabilities on our consolidated balance sheets as of December 27, 2014, as we had not yet received the
related goods or taken title to the property.
2Other purchase obligations and commitments include payments due under various types of licenses and agreements to
purchase goods or services, as well as payments due under non-contingent funding obligations. Funding obligations include
agreements to fund various projects with other companies.
3Amounts represent principal and interest cash payments over the life of the debt obligations, including anticipated interest
payments that are not recorded on our consolidated balance sheets. Debt obligations are classified based on their stated
maturity date, regardless of their classification on the consolidated balance sheets. Any future settlement of convertible debt
would impact our cash payments.
4We are unable to reliably estimate the timing of future payments related to uncertain tax positions; therefore, $262 million of
long-term income taxes payable has been excluded from the preceding table. However, long-term income taxes payable,
recorded on our consolidated balance sheets, included these uncertain tax positions, reduced by the associated federal
deduction for state taxes and U.S. tax credits arising from non-U.S. income taxes.
5Amounts represent future cash payments to satisfy other long-term liabilities recorded on our consolidated balance sheets,
including the short-term portion of these long-term liabilities. Expected required contributions to our U.S. and non-U.S. pension
plans and other postretirement benefit plans of $69 million to be made during 2015 are also included; however, funding
projections beyond 2015 are not practicable to estimate.
6Total excludes contractual obligations already recorded on our consolidated balance sheets as current liabilities except for the
short-term portions of long-term debt obligations and other long-term liabilities.
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