Annual report pursuant to Section 13 and 15(d)

Borrowings

v3.20.4
Borrowings
 12 Months Ended
Dec. 26, 2020
Debt Disclosure [Abstract]  
Borrowings [Text Block]
Note 13 : Borrowings
Short-Term Debt
Short-term debt, which primarily includes the current portion of long-term debt, was $2.5 billion as of December 26, 2020 and $3.7 billion as of December 28, 2019.
The current portion of long-term debt includes debt classified as short-term based on time remaining until maturity and, in 2019, also included amounts outstanding under our 2009 Debentures.
We have an ongoing authorization from our Board of Directors to borrow up to $10.0 billion under our commercial paper program.
Long-Term Debt
Dec 26, 2020 Dec 28, 2019
(In Millions)
Effective Interest Rate
 Amount Amount
Floating-rate senior notes:
Three-month LIBOR plus 0.08%, due May 2020 —% $ —  $ 700 
Three-month LIBOR plus 0.35%, due May 2022 1.25% 800  800 
Fixed-rate senior notes:
1.85%, due May 2020 —% —  1,000 
2.45%, due July 2020 —% —  1,750 
1.70%, due May 2021 1.79% 500  500 
3.30%, due October 2021 2.99% 2,000  2,000 
2.35%, due May 2022 1.96% 750  750 
3.10%, due July 2022 2.70% 1,000  1,000 
4.00%, due December 20221
2.83% 417  382 
2.70%, due December 2022 2.28% 1,500  1,500 
4.10%, due November 2023 3.22% 400  400 
2.88%, due May 2024 2.31% 1,250  1,250 
2.70%, due June 2024 2.14% 600  600 
3.40%, due March 2025 3.46% 1,500  — 
3.70%, due July 2025 2.93% 2,250  2,250 
2.60%, due May 2026 1.36% 1,000  1,000 
3.75%, due March 2027 3.80% 1,000  — 
3.15%, due May 2027 1.91% 1,000  1,000 
2.45%, due November 2029 2.39% 2,000  1,250 
3.90%, due March 2030 3.94% 1,500  — 
4.00%, due December 2032 1.84% 750  750 
4.60%, due March 2040 4.62% 750  — 
4.80%, due October 2041 2.82% 802  802 
4.25%, due December 2042 2.01% 567  567 
4.90%, due July 2045 2.90% 772  772 
4.10%, due May 2046 2.13% 1,250  1,250 
4.10%, due May 2047 2.07% 1,000  1,000 
4.10%, due August 2047 1.64% 640  640 
3.73%, due December 2047 2.39% 1,967  1,967 
3.25%, due November 2049 3.20% 2,000  1,500 
4.75%, due March 2050 4.76% 2,250  — 
3.10%, due February 2060 3.12% 1,000  — 
4.95%, due March 2060 5.00% 1,000  — 
Oregon and Arizona bonds:
2.40% - 2.70%, due December 2035 - 2040 2.49% 423  423 
5.00%, due March 2049 2.13% 138  138 
5.00%, due June 2049 2.15% 438  438 
Junior subordinated convertible debentures:
3.25%, due August 2039 —% —  372 
Total senior notes and other borrowings 35,214  28,751 
Unamortized premium/discount and issuance costs (378) (529)
Hedge accounting fair value adjustments 1,565  781 
Long-term debt 36,401  29,003 
Current portion of long-term debt (2,504) (3,695)
Total long-term debt $ 33,897  $ 25,308 
1To manage foreign currency risk associated with the Australian-dollar-denominated notes issued in 2015, we entered into currency interest rate swaps which had an aggregate outstanding notional amount of $396 million at December 26, 2020, which effectively converted these notes to U.S.-dollar-denominated notes. For further discussion on our currency interest rate swaps, see "Note 16: Derivative Financial Instruments." Principal and unamortized discount/issuance costs for the Australian-dollar-denominated notes in the table above were calculated using foreign currency exchange rates as of December 26, 2020 and December 28, 2019.
Senior Notes
In 2020, we issued a total of $10.3 billion aggregate principal amount of senior notes. Net proceeds from the offerings are being used for general corporate purposes, which may include refinancing outstanding debt, funding for working capital and capital expenditures, and repurchasing shares of our common stock. During 2020, we repaid $1.0 billion of our 1.85% senior notes that matured in May 2020 and $1.8 billion of our 2.45% senior notes that matured in July 2020. We also repaid $700 million in floating-rate senior notes that matured in May 2020.
In 2019, we issued a total of $2.8 billion aggregate principal amount of senior notes and redeemed our $915 million, 4.70% senior notes due December 2045.
Our floating-rate senior notes pay interest quarterly and our fixed-rate senior notes pay interest semiannually. We may redeem the fixed-rate notes prior to their maturity at our option at specified redemption prices and subject to certain restrictions. The obligations under the notes rank equally in right of payment with all of our other existing and future senior unsecured indebtedness and will effectively rank junior to all liabilities of our subsidiaries.
Oregon and Arizona Bonds
In 2019, we received proceeds of $648 million in aggregate from the sale of the 2019 Arizona Bonds and the 2019 Oregon Bonds. The bonds are our unsecured general obligations in accordance with loan agreements we entered into with the Industrial Development Authority of the City of Chandler, Arizona and the State of Oregon Business Development Commission. The bonds mature in 2049 and carry an interest rate of 5.00%. The 2019 Arizona Bonds and the 2019 Oregon Bonds are subject to mandatory tender in June 2024 and March 2022, respectively, at which time we can re-market the bonds as either fixed-rate bonds for a specified period or as variable-rate bonds until another fixed-rate period is selected or until their final maturity date.
Convertible Debentures
In 2009, we issued the 2009 Debentures, which were convertible, subject to certain conditions, into shares of our common stock and paid a fixed rate of interest semiannually. In 2019, we paid $1.5 billion to satisfy conversion obligations for $615 million in principal, resulting in a cumulative loss of $156 million in interest and other, net, and $1.0 billion as a reduction in stockholders' equity related to the conversion feature. In 2020, we paid $1.1 billion in cash to settle our remaining $372 million in principal, resulting in a loss of $109 million in interest and other, net and $750 million as a reduction in stockholders' equity related to the conversion feature.
Debt Maturities
Our aggregate debt maturities, excluding commercial paper and drafts payable, based on outstanding principal as of December 26, 2020, by year payable, are as follows:
(In Millions) 2021 2022 2023 2024 2025 2026 and thereafter Total
$ 2,500  $ 4,467  $ 400  $ 1,850  $ 3,750  $ 22,247  $ 35,214