Quarterly report pursuant to Section 13 or 15(d)

Operating Segments

v3.10.0.1
Operating Segments
9 Months Ended
Sep. 29, 2018
Segment Reporting [Abstract]  
Operating Segments [Text Block]
NOTE 3: OPERATING SEGMENTS
We manage our business through the following operating segments:
Client Computing Group (CCG)
Data Center Group (DCG)
Internet of Things Group (IOTG)
Non-Volatile Memory Solutions Group (NSG)
Programmable Solutions Group (PSG)
All Other
During the third quarter of 2018, we made an organizational change to combine our artificial intelligence investments in edge computing with IOTG; accordingly, approximately $480 million of goodwill was reallocated from "all other" to the IOTG operating segment.
We offer platform products that incorporate various components and technologies, including a microprocessor and chipset, a stand-alone System-on-Chip (SoC), or a multichip package. A platform product may be enhanced by additional hardware, software, and services offered by Intel. Platform products are used in various form factors across our CCG, DCG, and IOTG operating segments. We derive a substantial majority of our revenue from platform products, which are our principal products and considered as one class of product.
CCG and DCG are our reportable operating segments. IOTG, NSG, and PSG do not meet the quantitative thresholds to qualify as reportable operating segments; however, we have elected to disclose the results of these non-reportable operating segments. 
The “all other” category includes revenue, expenses, and charges such as:
results of operations from non-reportable segments not otherwise presented, including Mobileye results;
historical results of operations from divested businesses, including Intel Security Group (ISecG) results;
results of operations of start-up businesses that support our initiatives, including our foundry business;
amounts included within restructuring and other charges;
a portion of employee benefits, compensation, and other expenses not allocated to the operating segments; and
acquisition-related costs, including amortization and any impairment of acquisition-related intangibles and goodwill.
The Chief Operating Decision Maker (CODM), which is our interim Chief Executive Officer, does not evaluate operating segments using discrete asset information. Operating segments do not record inter-segment revenue. We do not allocate gains and losses from equity investments, interest and other income, or taxes to operating segments. Although the CODM uses operating income to evaluate the segments, operating costs included in one segment may benefit other segments. Except for these differences, the accounting policies for segment reporting are the same as for Intel as a whole.
Net revenue and operating income (loss) for each period were as follows:
 
 
Three Months Ended
 
Nine Months Ended
(In Millions)
 
Sep 29,
2018
 
Sep 30,
2017
 
Sep 29,
2018
 
Sep 30,
2017
Net revenue:
 
 
 
 
 
 
 
 
Client Computing Group
 
 
 
 
 
 
 
 
Platform
 
$
9,023

 
$
8,132

 
$
24,703

 
$
23,163

Adjacent
 
1,211

 
728

 
2,479

 
1,886

 
 
10,234

 
8,860

 
27,182

 
25,049

Data Center Group
 
 
 
 
 
 
 
 
Platform
 
5,637

 
4,439

 
15,561

 
12,344

Adjacent
 
502

 
439

 
1,361

 
1,138

 
 
6,139

 
4,878

 
16,922

 
13,482

Internet of Things Group
 
 
 
 
 
 
 
 
Platform
 
855

 
680

 
2,319

 
1,926

Adjacent
 
64

 
169

 
320

 
364

 
 
919

 
849

 
2,639

 
2,290

Non-Volatile Memory Solutions Group
 
1,081

 
891

 
3,200

 
2,631

Programmable Solutions Group
 
496

 
469

 
1,511

 
1,334

All other
 
294

 
202

 
737

 
922

Total net revenue
 
$
19,163

 
$
16,149

 
$
52,191

 
$
45,708

 
 
 
 
 
 
 
 
 
Operating income (loss):
 
 
 
 
 
 
 
 
Client Computing Group
 
$
4,532

 
$
3,600

 
$
10,557

 
$
9,656

Data Center Group
 
3,082

 
2,255

 
8,421

 
5,403

Internet of Things Group
 
321

 
146

 
791

 
390

Non-Volatile Memory Solutions Group
 
160

 
(52
)
 
14

 
(291
)
Programmable Solutions Group
 
106

 
113

 
304

 
302

All other
 
(852
)
 
(921
)
 
(2,995
)
 
(2,845
)
Total operating income
 
$
7,349

 
$
5,141

 
$
17,092

 
$
12,615


Disaggregated net revenue for each period was as follows:
 
 
Three Months Ended
 
Nine Months Ended
(In Millions)
 
Sep 29,
2018
 
Sep 30,
2017
 
Sep 29,
2018
 
Sep 30,
2017
Platform revenue
 
 
 
 
 
 
 
 
Desktop platform
 
$
3,225

 
$
2,967

 
$
9,087

 
$
8,598

Notebook platform
 
5,774

 
5,123

 
15,549

 
14,437

DCG platform
 
5,637

 
4,439

 
15,561

 
12,344

Other platform1
 
879

 
722

 
2,386

 
2,054

 
 
15,515

 
13,251

 
42,583

 
37,433

 
 
 
 
 
 
 
 
 
Adjacent revenue2
 
3,648

 
2,898

 
9,608

 
7,741

ISecG divested business
 

 

 

 
534

Total revenue
 
$
19,163

 
$
16,149

 
$
52,191

 
$
45,708


1 
Includes our tablet, service provider, and IOTG platform revenue.
2 
Includes all of our non-platform products for CCG, DCG, and IOTG like modem, ethernet, and silicon photonics, as well as NSG, PSG, and Mobileye products.