Quarterly report pursuant to Section 13 or 15(d)

Operating Segment Information

v2.4.0.6
Operating Segment Information
 3 Months Ended
Mar. 31, 2012
Operating Segment Information [Abstract]  
Operating Segment Information [Text Block]

Note 21: Operating Segment Information

 

Our operating segments in effect as of March 31, 2012 include:

  • PC Client Group
  • Data Center Group
  • Other Intel architecture operating segments
  • Intel Mobile Communications
  • Intelligent Systems Group
  • Netbook and Tablet Group
  • Ultra-Mobility Group
  • Software and services operating segments
  • McAfee
  • Wind River Software Group
  • Software and Services Group
  • All Other
  • Non-Volatile Memory Solutions Group

     

    We are reorganizing our smartphone, tablet, and mobile communication businesses within other Intel architecture operating segments to enable us to move faster and with greater collaboration and synergies in the market segment for mobile devices. The other Intel architecture operating segments will also continue to include our embedded and netbook businesses. We are currently in the process of making these changes to our organization and our systems. Given the scope of the business lines being impacted, this reorganization is expected to be completed in the second quarter of 2012 and reported in our earnings release Form 8-K for the quarter ended June 30, 2012.

     

    The Chief Operating Decision Maker (CODM) is our President and Chief Executive Officer. The CODM allocates resources to and assesses the performance of each operating segment using information about its revenue and operating income (loss).

     

    Our PC Client Group and our Data Center Group are reportable operating segments. We also aggregate and disclose the financial results of our non-reportable operating segments within “other Intel architecture operating segments” and “software and services operating segments” as shown in the above operating segments list. Each of these aggregated operating segments does not meet the quantitative thresholds to qualify as reportable operating segments; however, we have elected to disclose the aggregation of these non-reportable operating segments. Revenue for our reportable and aggregated non-reportable operating segments is primarily related to the following product lines:

  • PC Client Group. Includes platforms designed for the notebook and desktop (including high-end enthusiast PCs) market segments; and wireless connectivity products.
  • Data Center Group. Includes platforms designed for the server, workstation, and storage computing market segments; and wired network connectivity products.
  • Other Intel architecture operating segments. Includes mobile phone components such as baseband processors, radio frequency transceivers, and power management chips; platforms designed for embedded applications; platforms for the netbook and tablet market segments; and products designed for the smartphone market segment.
  • Software and services operating segments. Includes software products for endpoint security, network and content security, risk and compliance, and consumer and mobile security from our McAfee business; software optimized products for the embedded and mobile market segments; and software products and services that promote Intel® architecture as the platform of choice for software development.

 

We have sales and marketing, manufacturing, finance, and administration groups. Expenses for these groups are generally allocated to the operating segments, and the expenses are included in the operating results reported below.

 

The “All other” category includes revenue, expenses, and charges such as:

  • results of operations from our Non-Volatile Memory Solutions Group that includes NAND flash memory products for use in a variety of devices;
  • a portion of profit-dependent compensation and other expenses not allocated to the operating segments;
  • results of operations of seed businesses that support our initiatives; and
  • acquisition-related costs, including amortization and any impairment of acquisition-related intangibles and goodwill.

 

The CODM 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.

 

Segment information is summarized as follows:

      Three Months Ended
      March 31,   April 2,
(In Millions) 2012   2011
Net revenue          
  PC Client Group $ 8,451   $ 8,621
  Data Center Group   2,453     2,464
  Other Intel architecture operating segments   1,075     1,149
  Software and services operating segments   571     240
  All other   356     373
    Total net revenue $ 12,906   $ 12,847
               
Operating income (loss)          
  PC Client Group $ 3,483   $ 3,543
  Data Center Group   1,143     1,222
  Other Intel architecture operating segments   (312)     (36)
  Software and services operating segments   7     (52)
  All other   (511)     (519)
    Total operating income $ 3,810   $ 4,158