INTEL CORPORATION | |||||||||||||
SUPPLEMENTAL RECONCILIATIONS OF GAAP TO NON-GAAP RESULTS | |||||||||||||
In addition to disclosing financial results in accordance with United States (U.S.) generally accepted accounting principles (GAAP), this document contains non-GAAP financial measures that we believe are helpful in understanding and comparing our past financial performance and our expectations for future results. The non-GAAP financial measures disclosed by the company exclude the amortization of acquisition-related intangible assets, as well as the related income tax effect. Amortization of acquisition-related intangible assets consists of the amortization of developed technology, trade names, and customer relationships acquired in connection with business combinations. We record charges relating to the amortization of these intangibles in our GAAP financial statements. Amortization charges for our acquisition-related intangible assets are inconsistent in size and are significantly impacted by the timing and valuation of our acquisitions. Consequently, our non-GAAP adjustment excludes these charges to facilitate an evaluation of our current operating performance and comparisons to our past operating performance. | |||||||||||||
Set forth below are reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures. The non-GAAP financial measures disclosed by the company have limitations and should not be considered a substitute for, or superior to, financial measures prepared in accordance with GAAP, and the financial results prepared in accordance with GAAP and reconciliations from these results should be carefully evaluated. Management believes the non-GAAP financial measures are appropriate for period to period comparisons in our budget, planning and evaluation processes, and to show the reader how our performance compares to other periods. | |||||||||||||
(In millions, except per share amounts) | |||||||||||||
Three Months Ended | Twelve Months Ended | ||||||||||||
Dec 29, | Dec 31, | Dec 29, | Dec 31, | ||||||||||
2012 | 2011 | 2012 | 2011 | ||||||||||
GAAP GROSS MARGIN | $ | 7,817 | $ | 8,952 | $ | 33,151 | $ | 33,757 | |||||
Adjustment for the amortization of acquisition-related intangibles | 137 | 137 | 557 | 482 | |||||||||
NON-GAAP GROSS MARGIN | $ | 7,954 | $ | 9,089 | $ | 33,708 | $ | 34,239 | |||||
GAAP GROSS MARGIN PERCENTAGE | 58.0% | 64.5% | 62.1% | 62.5% | |||||||||
Adjustment for the amortization of acquisition-related intangibles | 1.0% | 0.9% | 1.1% | 0.9% | |||||||||
NON-GAAP GROSS MARGIN PERCENTAGE | 59.0% | 65.4% | 63.2% | 63.4% | |||||||||
GAAP OPERATING INCOME | $ | 3,155 | $ | 4,599 | $ | 14,638 | $ | 17,477 | |||||
Adjustment for the amortization of acquisition-related intangibles | 212 | 209 | 865 | 742 | |||||||||
NON-GAAP OPERATING INCOME | $ | 3,367 | $ | 4,808 | $ | 15,503 | $ | 18,219 | |||||
GAAP NET INCOME | $ | 2,468 | $ | 3,360 | $ | 11,005 | $ | 12,942 | |||||
Adjustment for: | |||||||||||||
Amortization of acquisition-related intangibles | 212 | 209 | 865 | 742 | |||||||||
Income tax effect | (71) | (46) | (290) |
(160) |
|||||||||
NON-GAAP NET INCOME | $ | 2,609 | $ | 3,523 | $ | 11,580 | $ |
13,524 |
|||||
GAAP DILUTED EARNINGS PER COMMON SHARE | $ | 0.48 | $ | 0.64 | $ | 2.13 | $ | 2.39 | |||||
Adjustment for: | |||||||||||||
Amortization of acquisition-related intangibles | 0.04 | 0.04 | 0.17 | 0.14 | |||||||||
Income tax effect | (0.01) | (0.01) | (0.06) | (0.03) | |||||||||
NON-GAAP DILUTED EARNINGS PER COMMON SHARE | $ | 0.51 | $ | 0.67 | $ | 2.24 | $ | 2.50 |