NVIDIA CORP, 10-K filed on 3/12/2015
Annual Report
Document and Entity Information Document (USD $)
12 Months Ended
Jan. 25, 2015
Mar. 6, 2015
Jul. 27, 2014
Document Information [Line Items]
 
 
 
Entity Registrant Name
NVIDIA CORP 
 
 
Entity Central Index Key
0001045810 
 
 
Current Fiscal Year End Date
--01-25 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
Document Type
10-K 
 
 
Document Period End Date
Jan. 25, 2015 
 
 
Document Fiscal Year Focus
2015 
 
 
Document Fiscal Period Focus
FY 
 
 
Amendment Flag
false 
 
 
Entity Common Stock, Shares Outstanding
 
549,840,211 
 
Entity Well-known Seasoned Issuer
Yes 
 
 
Entity Voluntary Filers
No 
 
 
Entity Current Reporting Status
Yes 
 
 
Entity Public Float
 
 
$ 9,375,465,755 
CONSOLIDATED STATEMENTS OF INCOME (USD $)
In Thousands, except Per Share data, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Revenue
$ 4,681,507 
$ 4,130,162 
$ 4,280,159 
Cost of revenue
2,082,030 
1,862,399 
2,053,816 
Gross profit
2,599,477 
2,267,763 
2,226,343 
Operating expenses
 
 
 
Research and development
1,359,725 
1,335,834 
1,147,282 
Sales, general and administrative
480,763 
435,702 
430,822 
Total operating expenses
1,840,488 
1,771,536 
1,578,104 
Income from operations
758,989 
496,227 
648,239 
Interest income
28,090 
17,119 
19,908 
Interest expense
46,133 
10,443 
3,294 
Other income (expense), net
13,890 
7,351 
(2,814)
Income before income tax
754,836 
510,254 
662,039 
Income tax expense
124,249 
70,264 
99,503 
Net income
$ 630,587 
$ 439,990 
$ 562,536 
Basic net income per share
$ 1.14 
$ 0.75 
$ 0.91 
Diluted net income per share
$ 1.12 
$ 0.74 
$ 0.90 
Weighted average shares used in basic per share computation (in shares)
552,319 
587,893 
619,324 
Weighted average shares used in diluted per share computation (in shares)
563,068 
594,517 
624,957 
Cash dividends declared and paid per common share
$ 0.340 
$ 0.310 
$ 0.075 
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Net income
$ 630,587 
$ 439,990 
$ 562,536 
Net change in unrealized gains (losses) on available-for-sale securities, net of tax
3,061 
(3,555)
(303)
Reclassification adjustments for net realized gains on available-for-sale securities included in net income, net of taxes
(94)
(1,549)
(330)
Other comprehensive income (loss)
2,967 
(5,104)
(633)
Total comprehensive income
$ 633,554 
$ 434,886 
$ 561,903 
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parentheticals) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Tax effect on net change in unrealized gains/losses on available-for-sale securities
$ (747)
$ 134 
$ (126)
Tax effect on reclassification adjustments for net realized gains on available-for-sale securities
$ 51 
$ 834 
$ 178 
CONSOLIDATED BALANCE SHEETS (USD $)
In Thousands, unless otherwise specified
Jan. 25, 2015
Jan. 26, 2014
Current assets:
 
 
Cash and cash equivalents
$ 496,654 
$ 1,151,587 
Marketable securities
4,126,685 
3,520,223 
Accounts receivable, net
473,637 
426,357 
Inventories
482,893 
387,765 
Prepaid expenses and other current assets
70,174 
70,285 
Deferred income taxes
63,254 
68,494 
Total current assets
5,713,297 
5,624,711 
Property and equipment, net
557,282 
582,740 
Goodwill
618,179 
643,179 
Intangible assets, net
221,714 
296,012 
Other assets
90,896 
104,252 
Total assets
7,201,368 
7,250,894 
Current liabilities:
 
 
Accounts payable
293,223 
324,391 
Accrued liabilities and other current liabilities
602,807 
621,105 
Total current liabilities
896,030 
945,496 
Long-term Debt
1,384,342 
1,356,375 
Other long-term liabilities
488,928 
475,125 
Capital lease obligations, long term
14,086 
17,500 
Commitments and contingencies - see Note 12
0 
0 
Shareholders' equity
 
 
Preferred stock
0 
0 
Common stock
754 
732 
Additional paid-in capital
3,855,092 
3,483,342 
Treasury stock, at cost
(3,394,585)
(2,537,295)
Accumulated other comprehensive income
7,844 
4,877 
Retained earnings
3,948,877 
3,504,742 
Total shareholders' equity
4,417,982 
4,456,398 
Total liabilities and shareholders' equity
$ 7,201,368 
$ 7,250,894 
CONSOLIDATED BALANCE SHEETS (Parentheticals) (USD $)
In Thousands, except Per Share data, unless otherwise specified
Jan. 25, 2015
Jan. 26, 2014
Allowance for Doubtful Accounts Receivable
$ 16,982 
$ 14,959 
Preferred Stock, Par or Stated Value Per Share
$ 0.001 
$ 0.001 
Preferred Stock, Shares Authorized
2,000 
2,000 
Preferred Stock, Shares Issued
0 
0 
Common Stock, Par or Stated Value Per Share
$ 0.001 
$ 0.001 
Common Stock, Shares Authorized
2,000,000 
2,000,000 
Common Stock, Shares, Issued
758,872 
735,242 
Common stock, shares, outstanding
544,913 
567,997 
Treasury Stock, Shares
213,959 
167,246 
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $)
In Thousands, unless otherwise specified
Total
Common Stock Outstanding
Additional Paid-in Capital
Treasury Stock
Accumulated Other Comprehensive Income (Loss)
Retained Earnings
Balances, at Jan. 29, 2012
$ 4,145,724 
$ 700 
$ 2,900,896 
$ (1,496,904)
$ 10,614 
$ 2,730,418 
Beginning common stock, shares, outstanding at Jan. 29, 2012
 
612,191 
 
 
 
 
Increase (Decrease) in Shareholders' Equity
 
 
 
 
 
 
Other comprehensive income (loss)
(633)
 
 
 
(633)
 
Net income
562,536 
 
 
 
 
562,536 
Issuance of common stock from stock plans, shares
 
14,801 
 
 
 
 
Issuance of common stock from stock plans, value
90,741 
20 
90,721 
0 
 
 
Tax withholding related to vesting of restricted stock units, shares
 
(1,836)
 
 
 
 
Tax withholding related to vesting of restricted stock units, value
(25,805)
 
 
(25,805)
 
 
Tax benefit from stock-based compensation
64,905 
 
64,905 
 
 
 
Share repurchase, shares
 
(8,400)
 
 
 
 
Share repurchase, value
(100,000)
 
 
(100,000)
 
 
Cash dividends declared and paid
(46,866)
 
 
 
 
(46,866)
Purchase of convertible note hedges
0 
 
 
 
 
 
Proceeds from the sale of common stock warrants
0 
 
 
 
 
 
Stock-based compensation
137,101 
 
137,101 
 
 
 
Balances, at Jan. 27, 2013
4,827,703 
720 
3,193,623 
(1,622,709)
9,981 
3,246,088 
Ending common stock, shares, outstanding at Jan. 27, 2013
 
616,756 
 
 
 
 
Increase (Decrease) in Shareholders' Equity
 
 
 
 
 
 
Other comprehensive income (loss)
(5,104)
 
 
 
(5,104)
 
Net income
439,990 
 
 
 
 
439,990 
Issuance of common stock from stock plans, shares
 
15,089 
 
 
 
 
Issuance of common stock from stock plans, value
97,454 
12 
97,442 
0 
 
 
Tax withholding related to vesting of restricted stock units, shares
 
(1,944)
 
 
 
 
Tax withholding related to vesting of restricted stock units, value
(27,282)
 
 
(27,282)
 
 
Tax benefit from stock-based compensation
23,827 
 
23,827 
 
 
 
Share repurchase, shares
 
(61,904)
 
 
 
 
Share repurchase, value
(887,304)
 
 
(887,304)
 
 
Cash dividends declared and paid
(181,336)
 
 
 
 
(181,336)
Discount on convertible notes
125,725 
 
125,725 
 
 
 
Purchase of convertible note hedges
(167,100)
 
(167,100)
 
 
 
Proceeds from the sale of common stock warrants
59,100 
 
59,100 
 
 
 
Deferred tax asset associated with convertible notes
14,481 
 
14,481 
 
 
 
Stock-based compensation
136,244 
 
136,244 
 
 
 
Balances, at Jan. 26, 2014
4,456,398 
732 
3,483,342 
(2,537,295)
4,877 
3,504,742 
Ending common stock, shares, outstanding at Jan. 26, 2014
567,997 
567,997 
 
 
 
 
Increase (Decrease) in Shareholders' Equity
 
 
 
 
 
 
Other comprehensive income (loss)
2,967 
 
 
 
2,967 
 
Net income
630,587 
 
 
 
 
630,587 
Issuance of common stock from stock plans, shares
 
23,629 
 
 
 
 
Issuance of common stock from stock plans, value
197,156 
22 
197,140 
6 
 
 
Tax withholding related to vesting of restricted stock units, shares
 
(2,326)
 
 
 
 
Tax withholding related to vesting of restricted stock units, value
(43,684)
 
 
(43,684)
 
 
Tax benefit from stock-based compensation
16,625 
 
16,625 
 
 
 
Share repurchase, shares
 
(44,387)
 
 
 
 
Share repurchase, value
(813,600)
 
 
(813,600)
 
 
Cash dividends declared and paid
(186,452)
 
 
 
 
(186,452)
Discount on convertible notes
125,725 
 
 
 
 
 
Purchase of convertible note hedges
0 
 
 
 
 
 
Proceeds from the sale of common stock warrants
0 
 
 
 
 
 
Stock-based compensation
157,985 
 
157,985 
 
 
 
Balances, at Jan. 25, 2015
$ 4,417,982 
$ 754 
$ 3,855,092 
$ (3,394,585)
$ 7,844 
$ 3,948,877 
Ending common stock, shares, outstanding at Jan. 25, 2015
544,913 
544,913 
 
 
 
 
STATEMENTS OF STOCKHOLDERS' EQUITY (Parentheticals)
3 Months Ended 12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Cash dividends declared and paid per common share
$ 0.340 
$ 0.310 
$ 0.075 
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Cash flows from operating activities:
 
 
 
Net income
$ 630,587 
$ 439,990 
$ 562,536 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
220,125 
239,148 
226,235 
Stock-based compensation
157,841 
136,295 
136,662 
Amortization of debt discount
27,967 
4,600 
0 
Net gain on sale and disposal of long-lived assets and investments
(16,549)
(8,140)
0 
Deferred income taxes
82,569 
15,430 
31,860 
Tax benefit from stock-based compensation
(18,456)
(25,801)
(68,710)
Others
24,099 
21,387 
47,911 
Changes in operating assets and liabilities, net of effects of acquisitions:
 
 
 
Accounts receivable
(49,324)
28,852 
(118,940)
Inventories
(94,984)
24,651 
(78,949)
Prepaid expenses and other current assets
4,427 
11,552 
(11,723)
Accounts payable
(26,895)
(20,382)
10,885 
Accrued liabilities and other current liabilities
5,322 
5,352 
17,353 
Other long-term liabilities
41,073 
37,788 
(69,052)
Net cash provided by operating activities
905,656 
835,146 
824,172 
Cash flows from investing activities:
 
 
 
Purchases of marketable securities
(2,861,809)
(3,065,404)
(2,378,445)
Proceeds from sales of marketable securities
1,371,982 
1,926,817 
854,993 
Proceeds from maturities of marketable securities
864,798 
585,150 
962,417 
Purchases of property and equipment and intangible assets
(122,381)
(255,186)
(183,309)
Proceeds from sale of long-lived assets and investments
20,862 
24,781 
0 
Acquisition of businesses, net of cash and cash equivalents
0 
(17,145)
0 
Others
(500)
(4,950)
352 
Net cash used in investing activities
(727,048)
(805,937)
(743,992)
Cash flows from financing activities:
 
 
 
Proceeds from issuance of convertible notes, net
0 
1,477,500 
0 
Purchase of convertible note hedges
0 
(167,100)
0 
Proceeds from the sale of common stock warrants
0 
59,100 
0 
Proceeds from issuance of stock under employee stock plans
153,472 
70,170 
64,935 
Payments related to repurchase of common stock
(813,600)
(887,304)
(100,000)
Dividends paid
(186,452)
(181,336)
(46,866)
Tax benefit from stock-based compensation
18,456 
25,801 
68,710 
Payments under capital lease obligations
(2,917)
(2,239)
(2,049)
Others
(2,500)
(5,000)
0 
Net cash (used in) provided by financing activities
(833,541)
389,592 
(15,270)
Change in cash and cash equivalents
(654,933)
418,801 
64,910 
Cash and cash equivalents at beginning of period
1,151,587 
732,786 
667,876 
Cash and cash equivalents at end of period
496,654 
1,151,587 
732,786 
Supplemental disclosures of cash flow information:
 
 
 
Cash (received) paid for income taxes, net
14,470 
14,615 
(38,608)
Cash paid for Intereston capital lease obligations
17,208 
2,518 
2,772 
Non-cash investing and financing activities:
 
 
 
Change in unrealized gains (losses) from marketable securities
2,967 
(5,104)
(633)
Assets acquired by assuming related liabilities
9,605 
3,327 
45,195 
Goodwill adjustment related to previously acquired business
$ (25,000)
$ 0 
$ 0 
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Organization and Summary of Significant Accounting Policies
 
Our Company

NVIDIA is dedicated to advancing visual computing. We enable individuals to interact with digital ideas, data and entertainment with an ease and efficiency unmatched by any other communication medium.

Our two reporting segments - GPU and Tegra Processor - are based on a single underlying graphics architecture.

Our GPU product brands aimed at specialized markets include GeForce for gamers; Quadro for designers; Tesla for researchers, deep learning and big-data analysts; and GRID for cloud-based visual computing users.

We also integrate our GPUs into tiny mobile chips called system-on-a-chip (SOC) processors, which power tablets, and automotive infotainment and safety systems. Our Tegra brand integrates an entire computer onto a single chip, incorporating GPUs and multi-core CPUs with audio, video and input/output capabilities. They can also be integrated with baseband processors to add voice and data communication. Tegra conserves power while delivering state-of-the-art graphics and multimedia processing.

Headquartered in Santa Clara, California, NVIDIA was incorporated in California in April 1993 and reincorporated in Delaware in April 1998.

All references to “NVIDIA,” “we,” “us,” “our” or the “Company” mean NVIDIA Corporation and its subsidiaries, except where it is made clear that the term means only the parent company.

Fiscal Year
 
We operate on a 52- or a 53-week year, ending on the last Sunday in January. Fiscal years 2015, 2014 and 2013 were 52-week years.
 
Reclassifications

Certain prior fiscal year balances have been reclassified to conform to the current fiscal year presentation.

Principles of Consolidation
 
Our consolidated financial statements include the accounts of NVIDIA Corporation and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates
 
The preparation of financial statements in conformity with accounting principles generally accepted in the United States, or U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. On an on-going basis, we evaluate our estimates, including those related to revenue recognition, inventories, income taxes, goodwill, cash equivalents and marketable securities, stock-based compensation, and litigation, investigation and settlement costs and other contingencies. These estimates are based on historical facts and various other assumptions that we believe are reasonable.

Revenue Recognition
 
Product Revenue

We recognize revenue from product sales when persuasive evidence of an arrangement exists, the product has been delivered, the price is fixed or determinable and collection of the related receivable is reasonably assured. For most sales, we use a binding purchase order and in certain cases we use a contractual agreement as evidence of an arrangement. We consider delivery to occur upon shipment provided title and risk of loss have passed to the customer. At the point of sale, we assess whether the arrangement fee is fixed or determinable and whether collection is reasonably assured. If we determine that collection of a fee is not reasonably assured, we defer the fee and recognize revenue at the time collection becomes reasonably assured, which is generally upon receipt of payment.
For sales to certain distributors with rights of return for which the level of returns cannot be reasonably estimated, our policy is to defer recognition of revenue and related cost of revenue until the distributors resell the product and, in some cases, when customer return rights lapse.
Our customer programs primarily involve rebates, which are designed to serve as sales incentives to resellers of our products in various target markets. We account for rebates as a reduction of revenue and recognize a liability for these rebates at the later of the date at which we record the related revenue or the date at which we offer the rebate. Unclaimed rebates are reversed to revenue.
Our customer programs also include marketing development funds, or MDFs.  MDFs represent monies paid to retailers, system builders, original equipment manufacturers, or OEMs, distributors, add-in card partners and other channel partners that are earmarked for market segment development and expansion and typically are designed to support our partners’ activities while also promoting NVIDIA products. We account for MDFs as a reduction of revenue and apply a breakage factor to certain types of MDF programs.

We also record a reduction to revenue by establishing a sales return allowance for estimated product returns at the time revenue is recognized, based primarily on historical return rates. However, if product returns for a particular fiscal period exceed historical return rates we may determine that additional sales return allowances are required to properly reflect our estimated exposure for product returns.

License and Development Revenue

For license arrangements that require significant customization of our intellectual property components, we generally recognize the related revenue over the period that services are performed. For most license and service arrangements, we determine progress to completion based on actual direct labor hours incurred to date as a percentage of the estimated total direct labor hours required to complete the project. A provision for estimated losses on contracts is made in the period in which the loss becomes probable and can be reasonably estimated. Costs incurred in advance of revenue recognized are recorded as deferred costs on uncompleted contracts. If the amount billed exceeds the amount of revenue recognized, the excess amount is recorded as deferred revenue.

For license arrangements that do not require significant customization but where we are obligated to provide further deliverables over the term of the license agreement, we record revenue over the life of the license term, with consideration received in advance of the performance period classified as deferred revenue.

Royalty revenue is recognized related to the distribution or sale of products that use our technologies under license agreements with third parties.  We recognize royalty revenue upon receipt of a confirmation of earned royalties and when collectability is reasonably assured from the applicable licensee.

Research and Development Expense

Research and development expense includes the conceptual formulation, design, and testing of product alternatives, construction of prototypes, and operation of pilot plants Research and development costs are charged to expense as incurred.

Advertising Expenses

We expense advertising costs in the period in which they are incurred. Advertising expenses for fiscal years 2015, 2014 and 2013 were $14.6 million, $13.1 million and $9.2 million, respectively. 

Rent Expense
 
We recognize rent expense on a straight-line basis over the lease period and accrue for rent expense incurred, but not paid.
 
Product Warranties
 
We generally offer limited warranty to end-users that ranges from one to three years for products in order to repair or replace products for any manufacturing defects or hardware component failures. Cost of revenue includes the estimated cost of product warranties that are calculated at the point of revenue recognition. Under limited circumstances, we may offer an extended limited warranty to customers for certain products. We also accrue for known warranty and indemnification issues if a loss is probable and can be reasonably estimated.

Stock-based Compensation
      
We estimate the fair value of employee stock options on the date of grant using a binomial model and recognize the expense using a straight-line attribution method over the requisite employee service period. We use the closing trading price of our common stock on the date of grant, minus a dividend yield discount, as the fair value of awards of restricted stock units, or RSUs, and performance stock units, or PSUs. The compensation expense for the RSUs is recognized using a straight-line attribution method over the requisite employee service period while compensation expense for PSUs is recognized using an accelerated amortization model. We estimate the fair value of shares to be issued under our employee stock purchase plan, or ESPP, using the Black-Scholes model at the commencement of an offering period in March and September of each year. Stock-based compensation for our ESPP is expensed using an accelerated amortization model.

Litigation, Investigation and Settlement Costs

From time to time, we are involved in legal actions and/or investigations by regulatory bodies. We are aggressively defending our current litigation matters. However, there are many uncertainties associated with any litigation or investigation, and we cannot be certain that these actions or other third-party claims against us will be resolved without litigation, fines and/or substantial settlement payments. If that occurs, our business, financial condition and results of operations could be materially and adversely affected. If information becomes available that causes us to determine that a loss in any of our pending litigation, investigations or settlements is probable, and we can reasonably estimate the loss associated with such events, we will record the loss in accordance with U.S. GAAP. However, the actual liability in any such litigation or investigation may be materially different from our estimates, which could require us to record additional costs.

Foreign Currency Remeasurement
 
We use the United States dollar as our functional currency for all of our subsidiaries. Foreign currency monetary assets and liabilities are remeasured into United States dollars at end-of-period exchange rates. Non-monetary assets and liabilities such as property and equipment, and equity are remeasured at historical exchange rates. Revenue and expenses are remeasured at average exchange rates in effect during each period, except for those expenses related to the previously noted balance sheet amounts, which are remeasured at historical exchange rates. Gains or losses from foreign currency remeasurement are included in “Other income (expense), net” in our Consolidated Statements of Income and to date have not been significant.

The impact of gain or loss from foreign currency remeasurement included in determining other income (expense), net for fiscal years 2015, 2014 and 2013 was $0.5 million, $4.7 million and $(1.5) million, respectively.  

Income Taxes
 
We recognize federal, state and foreign current tax liabilities or assets based on our estimate of taxes payable or refundable in the current fiscal year by tax jurisdiction. We recognize federal, state and foreign deferred tax assets or liabilities, as appropriate, for our estimate of future tax effects attributable to temporary differences and carryforwards; and we record a valuation allowance to reduce any deferred tax assets by the amount of any tax benefits that, based on available evidence and judgment, are not expected to be realized.

United States income tax has not been provided on a portion of earnings of our non-U.S. subsidiaries to the extent that such earnings are considered to be indefinitely reinvested.

Our calculation of current and deferred tax assets and liabilities is based on certain estimates and judgments and involves dealing with uncertainties in the application of complex tax laws. Our estimates of current and deferred tax assets and liabilities may change based, in part, on added certainty or finality to an anticipated outcome, changes in accounting standards or tax laws in the United States, or foreign jurisdictions where we operate, or changes in other facts or circumstances. In addition, we recognize liabilities for potential United States and foreign income tax contingencies based on our estimate of whether, and the extent to which, additional taxes may be due. If we determine that payment of these amounts is unnecessary or if the recorded tax liability is less than our current assessment, we may be required to recognize an income tax benefit or additional income tax expense in our financial statements accordingly.

As of January 25, 2015, we had a valuation allowance of $261.0 million related to state and certain foreign deferred tax assets that management determined are not likely to be realized due, in part, to projections of future taxable income and potential utilization limitations of tax attributes acquired as a result of stock ownership changes.  To the extent realization of the deferred tax assets becomes more-likely-than-not, we would recognize such deferred tax asset as an income tax benefit during the period.

Our deferred tax assets do not include the excess tax benefit related to stock-based compensation that are a component of our federal and state net operating loss and research tax credit carryforwards in the amount of $411.9 million as of January 25, 2015. Consistent with prior years, the excess tax benefit reflected in our net operating loss and research tax credit carryforwards will be accounted for as a credit to shareholders' equity, if and when realized. In determining if and when excess tax benefits have been realized, we have elected to utilize the with-and-without approach with respect to such excess tax benefits. We have also elected to ignore the indirect tax effects of stock-based compensation deductions for financial and accounting reporting purposes, and specifically to recognize the full effect of the research tax credit in income from operations.
 
We recognize the benefit from a tax position only if it is more-likely-than-not that the position would be sustained upon audit based solely on the technical merits of the tax position. Our policy is to include interest and penalties related to unrecognized tax benefits as a component of income tax expense. Please refer to Note 13 of these Notes to the Consolidated Financial Statements for additional information.

Comprehensive Income
 
Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) components include unrealized gains (losses) on available-for-sale securities, net of tax.

Net Income Per Share
 
Basic net income per share is computed using the weighted average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted average number of common and potentially dilutive shares outstanding during the period, using the treasury stock method. Under the treasury stock method, the effect of stock options outstanding is not included in the computation of diluted net income per share for periods when their effect is anti-dilutive. Additionally, we issued convertible notes with a net settlement feature that requires us, upon conversion, to settle the principal amount of debt for cash and the conversion premium for cash or shares of our common stock. Our convertible notes, note hedges, and related warrants contain various conversion features, which are further described in Note 11 of these Notes to the Consolidated Financial Statements. The potentially dilutive shares resulting from the convertible notes and warrants under the treasury stock method will be included in the calculation of diluted income per share when their inclusion is dilutive. However, unless actually exercised, the note hedges will not be included in the calculation of diluted net income per share, as their pre-exercised effect would be anti-dilutive under the treasury stock method.

Cash and Cash Equivalents
 
We consider all highly liquid investments that are readily convertible into cash and have an original maturity of three months or less at the time of purchase to be cash equivalents. As of January 25, 2015 and January 26, 2014, our cash and cash equivalents were $496.7 million and $1,151.6 million, respectively, which include $132.5 million and $307.9 million invested in money market funds for fiscal year 2015 and fiscal year 2014, respectively.

Marketable Securities
 
Marketable securities consist primarily of highly liquid investments with maturities of greater than three months when purchased. We generally classify our marketable securities at the date of acquisition as available-for-sale. These securities are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income, a component of shareholders’ equity, net of tax. The fair value of interest-bearing securities includes accrued interest. Any unrealized losses which are considered to be other-than-temporary impairments are recorded in the other income and expense section of our consolidated statements of income. Realized gains and losses on the sale of marketable securities are determined using the specific-identification method and recorded in the other income and expense section of our consolidated statements of income.

All of our available-for-sale investments are subject to a periodic impairment review. We record a charge to earnings when a decline in fair value is significantly below cost basis and judged to be other-than-temporary, or have other indicators of impairments. If the fair value of an available-for-sale debt instrument is less than its amortized cost basis, an other-than-temporary impairment is triggered in circumstances where (1) we intend to sell the instrument, (2) it is more likely than not that we will be required to sell the instrument before recovery of its amortized cost basis, or (3) a credit loss exists where we do not expect to recover the entire amortized cost basis of the instrument. In these situations, we recognize an other-than-temporary impairment in earnings equal to the entire difference between the debt instruments’ amortized cost basis and its fair value. For available-for-sale debt instruments that are considered other-than-temporarily impaired due to the existence of a credit loss, if we do not intend to sell and it is not more likely than not that we will not be required to sell the instrument before recovery of its remaining amortized cost basis (amortized cost basis less any current-period credit loss), we separate the amount of the impairment into the amount that is credit related and the amount due to all other factors. The credit loss component is recognized in earnings while loss related to all other factors is recorded as other comprehensive income.
 
Fair Value of Financial Instruments
 
The carrying value of cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their relatively short maturities as of January 25, 2015 and January 26, 2014. Marketable securities are comprised of available-for-sale securities that are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income, a component of shareholders’ equity, net of tax. Fair value of the marketable securities is determined based on quoted market prices.

Concentration of Credit Risk
 
Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash equivalents, marketable securities, accounts receivable and the note hedge. Our investment policy requires the purchase of high grade investment securities, the diversification of asset type and includes certain limits on our portfolio duration. All marketable securities are held in our name, managed by several investment managers and held by one major financial institution under a custodial arrangement. Accounts receivable from significant customers, those representing 10% or more of total accounts receivable, aggregated approximately 30% of our accounts receivable balance from two customers at January 25, 2015 and approximately 23% of our accounts receivable balance from one customer at January 26, 2014. We perform ongoing credit evaluations of our customers’ financial condition and maintain an allowance for potential credit losses. This allowance consists of an amount identified for specific customers and an amount based on overall estimated exposure. Our overall estimated exposure excludes amounts covered by credit insurance and letters of credit.

Accounts Receivable
 
We maintain an allowance for doubtful accounts receivable for estimated losses resulting from the inability of our customers to make required payments. We determine this allowance, which consists of an amount identified for specific customer issues as well as an amount based on overall estimated exposure. Factors impacting the allowance include the level of gross receivables, the financial condition of our customers and the extent to which balances are covered by credit insurance or letters of credit.

Inventories

Inventory cost is computed on an adjusted standard basis, which approximates actual cost on an average or first-in, first-out basis. Inventory costs consist primarily of the cost of semiconductors purchased from subcontractors, including wafer fabrication, assembly, testing and packaging, manufacturing support costs, including labor and overhead associated with such purchases, final test yield fallout, and shipping costs, as well as the cost of purchased memory products and other component parts. We charge cost of sales for inventory provisions to write down our inventory to the lower of cost or estimated market value or to completely write off obsolete or excess inventory. Most of our inventory provisions relate to the write-off of excess quantities of products, based on our inventory levels and future product purchase commitments compared to assumptions about future demand and market conditions. Once inventory has been written-off or written-down, it creates a new cost basis for the inventory that is not subsequently written-up.
Property and Equipment
 
Property and equipment are stated at cost. Depreciation of property and equipment is computed using the straight-line method based on the estimated useful lives of the assets, generally three to five years. Once an asset is identified for retirement or disposition, the related cost and accumulated depreciation or amortization are removed, and a gain or loss is recorded. The estimated useful lives of our buildings are up to twenty five years. Depreciation expense includes the amortization of assets recorded under capital leases. Leasehold improvements and assets recorded under capital leases are amortized over the shorter of the expected lease term or the estimated useful life of the asset.
Goodwill

Goodwill is subject to our annual impairment test during the fourth quarter of our fiscal year, or earlier if indicators of potential impairment exist.  For the purposes of completing our impairment test, we perform either a qualitative or a quantitative analysis on a reporting unit basis. 
For those reporting units where a significant change or event has occurred, where potential impairment indicators exist, or for which we have not performed a quantitative assessment recently, we utilize a two-step quantitative assessment to testing goodwill for impairment. The first step tests for possible impairment by applying a fair value-based test by weighing the results from the income approach and the market approach. The second step, if necessary, measures the amount of such impairment by applying fair value-based tests to individual assets and liabilities. Please refer to Note 5 of these Notes to the Consolidated Financial Statements for additional information. 

Intangible Assets

Intangible assets primarily represent rights acquired under technology licenses, patents, acquired intellectual property, trademarks and customer relationships and are subject to an annual impairment test. We currently amortize our intangible assets with definitive lives over periods ranging from one to ten years using a method that reflects the pattern in which the economic benefits of the intangible asset are consumed or otherwise used up or, if that pattern cannot be reliably determined, using a straight-line amortization method.

Impairment of Long-Lived Assets
 
Long-lived assets, such as property and equipment and intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset, or asset group may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset, or asset group to estimated undiscounted future cash flows expected to be generated by the asset, or asset group. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset or asset group exceeds the estimated fair value of the asset or asset group. Fair value is determined based on the estimated discounted future cash flows expected to be generated by the asset or asset group. Assets and liabilities to be disposed of would be separately presented in the consolidated balance sheet and the assets would be reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated.

Accounting for Asset Retirement Obligations
 
We account for asset retirement obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. The accounting guidance applies to legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or normal use of the assets and requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The fair value of the liability is added to the carrying amount of the associated asset and this additional carrying amount is depreciated over the life of the asset. As of January 25, 2015 and January 26, 2014, our asset retirement obligations to return the leasehold improvements at our headquarters facility and certain laboratories at our domestic and international facilities to their original condition upon lease termination were $7.4 million and $11.1 million, respectively.

Adoption of New and Recently Issued Accounting Pronouncements

In May 2014, the FASB issued a new accounting standard update that creates a single source of revenue guidance under U.S. GAAP for all companies, in all industries. Under the new standard, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new guidance requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and estimates used. This new guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. We will adopt this guidance either by using a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. We are currently evaluating the impact of this accounting guidance on our consolidated financial statements and have not yet determined which transition method we will apply.
Stock Based Compensation
Stock-Based Compensation
Stock-Based Compensation

Our stock-based compensation expense is associated with stock options, RSUs, PSUs and our ESPP.

Our consolidated statements of income include stock-based compensation expense, net of amounts capitalized as inventory, as follows:
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Cost of revenue
$
12,022

 
$
10,688

 
$
10,490

Research and development
88,355

 
82,940

 
82,157

Sales, general and administrative
57,464

 
42,667

 
44,015

Total
$
157,841

 
$
136,295

 
$
136,662



Stock-based compensation capitalized in inventories resulted in a net charge of $0.1 million, $0.1 million and $0.4 million in cost of revenue during the fiscal years 2015, 2014 and 2013, respectively.

The following is a summary of equity awards granted under our equity incentive plans:
 
Year Ended
 
January 25,

January 26,
 
January 27,
2015

2014
 
2013
 
(In thousands, except per share data)
Stock Options
 
 
 
 
 
Awards granted
86


6,149


7,119

Estimated total grant-date fair value
$
345

 
$
21,310

 
$
38,326

Weighted average grant-date fair value (per share)
$
4.02

 
$
3.47

 
$
5.38

 
 
 
 
 
 
RSUs and PSUs
 
 
 
 
 
Awards granted
12,912

 
10,757

 
8,136

Estimated total grant-date fair value
$
228,223

 
$
144,798

 
$
112,795

Weighted average grant-date fair value (per share)
$
17.68

 
$
13.46

 
$
13.86

 
 
 
 
 
 
ESPP
 
 
 
 
 
Shares purchased
6,672

 
6,124

 
5,463

Weighted average price (per share)
$
10.99

 
$
10.79

 
$
10.83

Weighted average grant-date fair value (per share)
$
4.99

 
$
5.60

 
$
5.16



During fiscal year 2015, we shifted away from granting stock options and toward granting RSUs and PSUs to reflect changing market trends for equity incentives at our peer companies. The number of PSUs that will ultimately vest is contingent on the Company’s level of achievement versus the corporate financial performance target established by our Compensation Committee in the beginning of each fiscal year. The number of shares of our stock to be received at vesting typically ranges from 0% to 200% of the target amount.

Of the estimated total grant-date fair value, we estimated that the stock-based compensation expense related to the equity awards that are not expected to vest for fiscal years 2015, 2014 and 2013 was $36.6 million, $29.7 million and $27.1 million, respectively. 
 
January 25,

January 26,
 
2015

2014
 
(In thousands)
Aggregated unearned stock-based compensation expense
$
291,416

 
$
256,500

 
 
 
 
Estimated weighted average amortization period
(In years)
Stock Options
1.8

 
2.5

RSUs and PSUs
2.8

 
2.7

ESPP
0.5

 
0.6



Valuation Assumptions 

We use the closing trading price of our common stock on the date of grant, minus a dividend yield discount, as the fair value of awards of RSUs and PSUs. Compensation expense for RSUs is recognized using a straight-line attribution method over the requisite employee service period, while compensation expense for PSUs is recognized using an accelerated amortization model.

We estimate the fair value of employee stock options on the date of grant using a binomial model and recognize the expense using a straight-line attribution method over the requisite employee service period.

We estimate the fair value of shares to be issued under our ESPP using the Black-Scholes model at the commencement of an offering period in March and September of each year. Stock-based compensation for our ESPP is expensed using an accelerated amortization model.

The fair value of stock options granted under our stock option plans and shares issued under our ESPP have been estimated with the following assumptions:
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(Using a binomial model)
Stock Options
 
 
 
 
 
Weighted average expected life (in years)
2.5-3.2
 
2.4-3.5
 
3.1-4.9
Risk-free interest rate
2.5%-2.8%
 
1.8%-3.0%
 
1.5%-2.3%
Volatility
31%
 
28%-37%
 
39%-49%
Dividend yield
1.8%-1.9%
 
1.9%-2.4%
 
2.4%

 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(Using the Black-Scholes model)
ESPP
 
 
 
 
 
Weighted average expected life (in years)
0.5-2.0
 
0.5-2.0
 
0.5-2.0

Risk-free interest rate
0.1%-0.5%
 
0.1%-0.4%
 
0.1%-0.3%

Volatility
23%-31%
 
32%-37%
 
44%-47%

Dividend yield
1.7%-1.9%
 
2.0%-2.4%
 
—



The expected life of employee stock options is a derived output of our valuation model and is impacted by the underlying assumptions of our company. For ESPP shares, the expected term represents the average term from the first day of the offering period to the purchase date.

The risk-free interest rate assumption used to value stock options and ESPP is based upon observed interest rates on Treasury bills appropriate for the expected term of the award.

Our expected stock price volatility assumption for stock options and ESPP is estimated using implied volatility.

For awards granted on or subsequent to November 8, 2012, we use a dividend yield at grant date, based on the per share dividends declared during the most recent quarter. Our RSU and PSU awards are not eligible for cash dividends prior to vesting; therefore, the fair value of RSUs and PSUs is discounted by the dividend yield.

Additionally, for employee stock options and RSU and PSU awards, we estimate forfeitures annually and revise the estimates of forfeiture in subsequent periods if actual forfeitures differ from those estimates. Forfeitures are estimated based on historical experience.

Equity Incentive Program
 
We grant stock options, RSUs, PSUs, and stock purchase rights under the following equity incentive plans.  

Amended and Restated 2007 Equity Incentive Plan
 
In 2007, our shareholders approved the NVIDIA Corporation 2007 Equity Incentive Plan, or the 2007 Plan. The 2007 Plan was amended and restated in 2012, 2013 and 2014, or the Restated 2007 Plan.

The Restated 2007 Plan authorizes the issuance of incentive stock options, non-statutory stock options, restricted stock, restricted stock unit, stock appreciation rights, performance stock awards, performance cash awards, and other stock-based awards to employees, directors and consultants. Only our employees may receive incentive stock options. With the 2014 amendment and restatement of the 2007 Plan, which increased the number of shares of common stock authorized for issuance under the 2007 Plan by 10,000,000 shares, up to 187,767,766 shares of our common stock may be issued pursuant to stock awards granted under the Restated 2007 Plan. Currently, we grant stock options, RSUs and PSUs under the Restated 2007 Plan, under which, as of January 25, 2015, there were 24,501,781 shares available for future issuance.

Stock options granted to employees, subject to certain exceptions, vest over a four year period, subject to continued service, with 25% vesting on the anniversary of the hire date in the case of new hires or the anniversary of the date of grant in the case of grants to existing employees and 6.25% vesting at the end of each quarterly period thereafter. Options granted under the 2007 Plan generally expire ten years from the date of grant.

Subject to certain exceptions, RSUs granted to employees vest over a four year period, subject to continued service, with 25% vesting on a pre-determined date that is close to the anniversary of the date of grant and 12.5% vesting semi-annually thereafter until fully vested.

PSUs granted to employees vest on a similar schedule, although the number of shares subject to PSUs that are eligible to vest is generally determined by the Compensation Committee based on achievement of pre-determined criteria.

Unless terminated sooner, the Restated 2007 Plan is scheduled to terminate on March 21, 2022. Our Board may suspend or terminate the Restated 2007 Plan at any time. No awards may be granted under the Restated 2007 Plan while the Restated 2007 Plan is suspended or after it is terminated. The Board may also amend the Restated 2007 Plan at any time. However, if legal, regulatory or listing requirements require shareholder approval, the amendment will not go into effect until the shareholders have approved the amendment.
 
PortalPlayer, Inc. 1999 Stock Option Plan

We assumed options issued under the PortalPlayer, Inc. 1999 Stock Option Plan, or the 1999 Plan, when we completed our acquisition of PortalPlayer on January 5, 2007.  As of January 25, 2015, there were no outstanding options to purchase NVIDIA common stock under the 1999 Plan and we do not intend to grant future stock awards under the 1999 Plan as the plan expired on July 28, 2014.

1998 and 2012 Employee Stock Purchase Plans
 
In February 1998, our Board approved the 1998 Employee Stock Purchase Plan, or the 1998 Plan. At the Annual Meeting of Shareholders held on May 17, 2012, our shareholders approved the 2012 Employee Stock Purchase Plan, or the 2012 Plan, as the successor to the 1998 Plan. At the Annual Meeting of Shareholders held on May 23, 2014, our shareholders approved an amendment and restatement of the 2012 Plan, or the Restated 2012 Plan.

Prior to the effective date of the 2012 Plan, we had authorized a total of 78,000,000 shares for issuance under the 1998 Plan, 54,567,667 shares of which had been issued, 15,000,000 shares of which were reserved for issuance pursuant to outstanding purchase rights and 8,432,333 shares of which were available for future issuance. Upon its approval by our shareholders in 2012, the maximum aggregate number of shares that could be issued under the 2012 Plan would not exceed 55,432,333 shares.

Effective upon the August 31, 2012 purchase date pursuant to the 1998 Plan, of the 15,000,000 shares which had been reserved for issuance pursuant to outstanding purchase rights, 2,687,698 shares were issued pursuant to outstanding purchase rights, 183,000 shares were available but reserved for future issuance, and the remaining 12,129,302 shares were moved into the share reserve of the 2012 Plan. Effective upon the final February 28, 2013 purchase date pursuant to the 1998 Plan, 8,819 shares were issued pursuant to outstanding purchase rights, and the remaining 174,181 shares were moved into the share reserve of the 2012 Plan. With the 2014 amendment and restatement of the 2012 Plan, which increased the share reserve of the Restated 2012 Plan by 12,500,000 shares, up to 65,235,816 shares of our common stock may be issued pursuant to purchases under the Restated 2012 Plan. At January 25, 2015, we had issued 12,787,748 shares and reserved 52,448,068 shares for future issuance under the Restated 2012 Plan.

The Restated 2012 Plan is intended to qualify as an “employee stock purchase plan” under Section 423 of the Internal Revenue Code. Under the current offerings adopted pursuant to the Restated 2012 Plan, each offering period is 24 months, which is divided into four purchase periods of six months.

Employees are eligible to participate if they are employed by us or an affiliate of us as designated by the Board. Employees who participate in an offering may have up to 10% of their earnings withheld up to certain limitations and applied on specified dates determined by the Board to the purchase of shares of common stock. The Board may increase this percentage at its discretion, up to 15%. The price of common stock purchased under our ESPP will be equal to 85% of the lower of the fair market value of the common stock on the commencement date of each offering period and the purchase date of each offering period. Employees may end their participation in the ESPP at any time during the offering period, and participation ends automatically on termination of employment with us. In each case, the employee’s contributions are refunded.  

The following is a summary of our equity award transactions under our equity incentive plans: 
 
Options Outstanding
 
RSUs and PSUs Outstanding
 
Number of
Shares
 
Weighted
Average
Exercise Price
Per Share
 
Weighted
Average
Remaining  
Contractual
Life
 
Aggregate
Intrinsic
Value (1)
 
Number of
Shares
 
Weighted
Average
Grant-Date
Fair Value
 
(In thousands, except years and per share data)
Balances, January 26, 2014
32,504

 
$
14.22

 
 
 
 
 
18,852

 
$
13.82

Granted (2)
86

 
$
18.75

 
 
 
 
 
12,912

 
$
17.68

Exercised
(9,795
)
 
$
12.64

 
 
 
 
 
—

 
—

Vested restricted stock
—

 
—

 
 
 
 
 
(7,163
)
 
$
13.78

Canceled and forfeited
(1,450
)
 
$
19.27

 
 
 
 
 
(1,326
)
 
$
14.44

Balances, January 25, 2015
21,345

 
$
14.61

 
5.9
 
$
130,923

 
23,275

 
$
15.94

Exercisable at January 25, 2015
15,120

 
$
14.70

 
5.1
 
$
91,434

 
 
 
 
Vested and expected to vest after January 25, 2015
20,356

 
$
14.62

 
5.8
 
$
124,575

 
18,988

 
$
15.96



(1)
The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value for in-the-money options at January 25, 2015, based on the $20.71 closing stock price of our common stock on the NASDAQ Global Select Market on January 23, 2015, the last trading day of fiscal year 2015, which would have been received by the option holders had all in-the-money option holders exercised their options as of that date. The total number of in-the-money options outstanding and exercisable as of January 25, 2015 was 21.1 million shares and 14.9 million shares, respectively.
(2)
Includes the total number of PSUs issuable if the maximum corporate financial performance target level for fiscal year 2015 is achieved. Depending on the actual level of achievement of the corporate performance target at the end of fiscal year 2015, the range of PSUs issued could be from 1.3 million to 2.5 million shares. The PSUs were granted during the first quarter of fiscal year 2015 to our CEO and senior management as approved by our Compensation Committee.

As of January 25, 2015 and January 26, 2014, there were 24.5 million and 24.7 million shares of common stock reserved for future issuance under our equity incentive plans.

The total intrinsic value of options exercised was $61.9 million, $14.4 million and $21.1 million for fiscal years 2015, 2014 and 2013, respectively. Upon exercise of an option, we issue new shares of stock. The total fair value of options vested was $32.6 million, $34.6 million and $40.3 million for fiscal years 2015, 2014 and 2013, respectively.
Net Income Per Share
Net Income Per Share
Net Income Per Share
 
The following is a reconciliation of the numerators and denominators of the basic and diluted net income per share computations for the periods presented:
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands, except per share data)
Numerator:
 
 
 
 
 
Net income
$
630,587

 
$
439,990

 
$
562,536

Denominator:
 
 
 
 
 
Denominator for basic net income per share, weighted average shares
552,319

 
587,893

 
619,324

Effect of dilutive securities:
 
 
 
 
 
Stock awards outstanding
10,749

 
6,624

 
5,633

Denominator for diluted net income per share, weighted average shares
563,068

 
594,517

 
624,957

Net income per share:
 
 
 
 
 
Basic
$
1.14

 
$
0.75

 
$
0.91

Diluted
$
1.12

 
$
0.74

 
$
0.90

Potentially dilutive securities excluded from income per diluted share because their effect would have been anti-dilutive
11,807

 
25,630

 
26,784



The denominator for diluted net income per share for fiscal years 2015 and 2014 does not include any effect from the 1.00 % Convertible Senior Notes due 2018, or the Notes. In accordance with ASC 260, Earnings per Share, commencing after the fiscal quarter ending on April 27, 2014, the Notes will not impact the denominator for diluted net income per share unless the average price of our common stock, as calculated under the terms of the Notes, exceeds the conversion price of $20.16 per share. Likewise, the denominator for diluted net income per share will not include any effect from the warrants unless the average price of our common stock, as calculated under the terms of the warrants, exceeds $27.14 per share.

The denominator for diluted net income per share for fiscal years 2015 and 2014 also does not include any effect from the convertible note hedge transaction, or the Note Hedges. In future periods, the denominator for diluted net income per share will exclude any effect of the Note Hedges, as their effect would be anti-dilutive. In the event an actual conversion of any or all of the Notes occurs, the shares that would be delivered to us under the Note Hedges are designed to neutralize the dilutive effect of the shares that we would issue under the Notes. Please refer to Note 11 of these Notes to the Consolidated Financial Statements for discussion regarding the Notes.
3dfx
3dfx
3dfx

During fiscal year 2002, we completed the purchase of certain assets from 3dfx Interactive, Inc., or 3dfx, for an aggregate purchase price of $74.2 million. On December 15, 2000, NVIDIA Corporation and one of our indirect subsidiaries entered into an Asset Purchase Agreement, or the APA, which closed on April 18, 2001, to purchase certain graphics chip assets from 3dfx.
 
In October 2002, 3dfx filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court for the Northern District of California. In March 2003, the Trustee appointed by the Bankruptcy Court to represent 3dfx’s bankruptcy estate served his complaint on NVIDIA. The Trustee’s complaint asserted claims for, among other things, successor liability and fraudulent transfer and sought additional payments from us. In early November 2005, NVIDIA and the Official Committee of Unsecured Creditors, or the Creditors’ Committee, agreed to a Plan of Liquidation of 3dfx, which included a conditional settlement of the Trustee’s claims against us. This conditional settlement was subject to a confirmation process through a vote of creditors and the review and approval of the Bankruptcy Court. The conditional settlement called for a payment by NVIDIA of $30.6 million to the 3dfx estate. Under the settlement, $5.6 million related to various administrative expenses and Trustee fees, and $25.0 million related to the satisfaction of debts and liabilities owed to the general unsecured creditors of 3dfx. Accordingly, during the three month period ended October 30, 2005, we recorded $5.6 million as a charge to settlement costs and $25.0 million as additional purchase price for 3dfx.  The Trustee advised that he intended to object to the settlement. 
 
The conditional settlement never progressed substantially through the confirmation process. On December 20, 2010, the District Court issued an Order affirming the Bankruptcy Court's entry of summary judgment in NVIDIA's favor, and on January 19, 2011, the Trustee filed a Notice of Appeal to the United States Court of Appeals for the Ninth Circuit. Oral argument on the appeal was held on October 8, 2014. On November 6, 2014, the Ninth Circuit affirmed the District Court’s decision upholding the ruling of the Bankruptcy Court. As a result, we paid $5.6 million in related legal expenses. The case concluded on February 5, 2015 and we reversed the $25.0 million liability for additional contingent consideration and reduced the goodwill related to our 3dfx acquisition by the same amount as of January 25, 2015.
 
Please refer to Note 12 of these Notes to the Consolidated Financial Statements for further information regarding this litigation.
Goodwill
Goodwill
Goodwill
 
The carrying amount of goodwill is as follows:
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Icera
$
271,186

 
$
271,186

PortalPlayer
104,896

 
104,896

3dfx
50,326

 
75,326

Mental Images
59,252

 
59,252

MediaQ
35,167

 
35,167

ULi
31,115

 
31,115

Hybrid Graphics
27,906

 
27,906

Ageia
19,198

 
19,198

Portland Group Inc.
2,149

 
2,149

Other
16,984

 
16,984

Total goodwill
$
618,179

 
$
643,179


 
The $25.0 million decrease in goodwill as of January 25, 2015, when compared to January 26, 2014 is due to conclusion of the 3dfx case without requiring additional contingent consideration. Please refer to Note 4 of these Notes to the Consolidated Financial Statements for further discussion regarding the 3dfx case.

The amount of goodwill allocated to our GPU and Tegra Processor segments as of January 25, 2015 was $209.7 million and $408.5 million, respectively, and as of January 26, 2014 was $230.4 million and $412.8 million, respectively. Please refer to Note 16 of these Notes to the Consolidated Financial Statements for further discussion regarding segments.

We allocate goodwill to our reporting units and perform our annual impairment test during the fourth quarter of our fiscal year, or earlier if indicators of potential impairment exist. For the purposes of completing our impairment test, we perform either a qualitative or a quantitative analysis on a reporting unit basis. We utilized a quantitative analysis to complete our most recent annual impairment test during the fourth quarter of fiscal year 2015 and concluded that there was no impairment, as the fair value of our reporting units exceeded their carrying values.

In a qualitative analysis, we evaluate factors including, but not limited to, macro-economic conditions, market and industry conditions, the competitive environment, the operational stability and the overall financial performance of the reporting units, including cost factors and actual revenue results. For reporting units in which the qualitative assessment concludes it is more likely than not that the fair value is more than its carrying value, no further goodwill impairment testing is required.

For those reporting units where a significant change or event has occurred, where potential impairment indicators exist, or for which we have not performed a quantitative assessment recently, we utilize a two-step quantitative assessment to testing goodwill for impairment. The first step tests for possible impairment by applying a fair value-based test by weighing the results from the income approach and the market approach. These valuation approaches consider a number of factors that include, but are not limited to, prospective financial information, growth rates, terminal or residual values, discount rates and comparable multiples from publicly traded companies in our industry and require us to make certain assumptions and estimates regarding industry economic factors and the future profitability of our business.

When performing an income approach valuation, we incorporate the use of projected financial information and a discount rate that are developed using market participant based assumptions to our discounted cash flow model. Our estimates of discounted cash flow were based upon, among other things, certain assumptions about our expected future operating performance, such as revenue growth rates, operating margins, risk-adjusted discount rates, and future economic and market conditions. The market method of determining the fair value of our reporting units requires us to use judgment in the selection of appropriate market comparables.
Intangible Assets
Intangible Assets
Amortizable Intangible Assets
 
The components of our amortizable intangible assets are as follows:
 
January 25, 2015
 
January 26, 2014
 
Gross 
Carrying
Amount
 
Accumulated
Amortization
 
Net 
Carrying
Amount
 
Weighted Average
Useful Life
 
Gross 
Carrying
Amount
 
Accumulated
Amortization
 
Net 
Carrying
Amount
 
Weighted Average Useful Life
 
(In thousands)
 
(In years)
 
(In thousands)
 
(In years)
Acquisition-related intangible assets
$
189,239

 
$
(134,062
)
 
$
55,177

 
6.8
 
$
189,239

 
$
(114,104
)
 
$
75,135

 
6.5
Patents and licensed technology
448,873

 
(282,336
)
 
166,537

 
7.2
 
446,196

 
(225,319
)
 
220,877

 
7.2
Total intangible assets
$
638,112

 
$
(416,398
)
 
$
221,714

 
 
 
$
635,435

 
$
(339,423
)
 
$
296,012

 
 


Amortization expense associated with intangible assets for fiscal years 2015, 2014 and 2013 was $77.0 million, $72.7 million and $68.4 million, respectively. Amortization expense increased compared to the prior year primarily due to the addition of licensed technology during fiscal year 2015. Future amortization expense for the net carrying amount of intangible assets at January 25, 2015 is estimated to be $71.9 million in fiscal year 2016, $63.6 million in fiscal year 2017, $49.1 million in fiscal year 2018, $20.4 million in fiscal year 2019, $11.9 million in fiscal year 2020 and $4.8 million in fiscal years subsequent to fiscal year 2020 until fully amortized.
Marketable Securities
Marketable Securities
Marketable Securities
 
All of the cash equivalents and marketable securities are classified as “available-for-sale” securities. Investments in both fixed and floating rate interest earning instruments carry a degree of interest rate risk. Fixed rate debt securities may have their market value adversely impacted due to a rise in interest rates, while floating rate securities may produce less income than expected if interest rates fall. Due in part to these factors, our future investment income may fall short of expectations due to changes in interest rates or if the decline in fair value of our publicly traded debt or equity investments is judged to be other-than-temporary. We may suffer losses in principal if we are forced to sell securities that decline in market value due to changes in interest rates. However, because any debt securities we hold are classified as “available-for-sale,” no gains or losses are realized in our consolidated statement of income due to changes in interest rates unless such securities are sold prior to maturity or unless declines in market values are determined to be other-than-temporary. These securities are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income, a component of shareholders’ equity, net of tax.

The following is a summary of cash equivalents and marketable securities at January 25, 2015 and January 26, 2014:
 
January 25, 2015
 
Amortized
Cost
 
Unrealized
Gain
 
Unrealized
Loss
 
Estimated
Fair Value
 
(In thousands)
Corporate debt securities
$
2,184,925

 
$
2,600

 
$
(1,214
)
 
$
2,186,311

Debt securities of United States government agencies
749,630

 
917

 
(227
)
 
750,320

Debt securities issued by United States Treasury
533,673

 
2,694

 
(3
)
 
536,364

Asset-backed securities
453,088

 
125

 
(329
)
 
452,884

Mortgage backed securities issued by United States government-sponsored enterprises
274,366

 
4,589

 
(850
)
 
278,105

Money market funds
132,495

 
—

 
—

 
132,495

Foreign government bonds
84,800

 
121

 
(5
)
 
84,916

Total
$
4,412,977

 
$
11,046

 
$
(2,628
)
 
$
4,421,395

Classified as:
 
 
 
 
 
 
 
Cash equivalents
 
 
 
 
 
 
$
294,710

Marketable securities
 
 
 
 
 
 
4,126,685

Total
 
 
 
 
 
 
$
4,421,395

 
 
January 26, 2014
 
Amortized
Cost
 
Unrealized
Gain
 
Unrealized
Loss
 
Estimated
Fair Value
 
(In thousands)
Corporate debt securities
$
1,762,833

 
$
1,837

 
$
(945
)
 
$
1,763,725

Debt securities of United States government agencies
1,012,740

 
848

 
(261
)
 
1,013,327

Debt securities issued by United States Treasury
495,889

 
621

 
(57
)
 
496,453

Money market funds
307,865

 
—

 
—

 
307,865

Asset-backed securities
258,017

 
15

 
(315
)
 
257,717

Mortgage backed securities issued by United States government-sponsored enterprises
185,594

 
3,837

 
(725
)
 
188,706

Foreign government bonds
64,955

 
20

 
(120
)
 
64,855

Total
$
4,087,893

 
$
7,178

 
$
(2,423
)
 
$
4,092,648

Classified as:
 
 
 
 
 
 
 
Cash equivalents
 
 
 
 
 
 
$
572,425

Marketable securities
 
 
 
 
 
 
3,520,223

Total
 
 
 
 
 
 
$
4,092,648

  
The following table provides the breakdown of the investments that were in a continuous unrealized loss position at January 25, 2015:
 
 
Less than 12 Months
 
12 Months or Greater
 
Total
 
Fair Value
 
Gross
Unrealized
Losses
 
Fair Value
 
Gross
Unrealized
Losses
 
Fair Value
 
Gross
Unrealized
Losses
 
(In thousands)
Corporate debt securities
$
709,392

 
$
(1,199
)
 
$
10,085

 
$
(15
)
 
$
719,477

 
$
(1,214
)
Mortgage backed securities issued by United States government-sponsored enterprises
81,245

 
(639
)
 
21,314

 
(211
)
 
102,559

 
(850
)
Debt securities of United States Treasury
10,026

 
(3
)
 
—

 
—

 
10,026

 
(3
)
Debt securities issued by United States government agencies
246,480

 
(227
)
 
—

 
—

 
246,480

 
(227
)
Asset-backed securities
306,066

 
(323
)
 
4,476

 
(6
)
 
310,542

 
(329
)
Foreign government bonds
11,008

 
(5
)
 
—

 
—

 
11,008

 
(5
)
Total
$
1,364,217

 
$
(2,396
)
 
$
35,875

 
$
(232
)
 
$
1,400,092

 
$
(2,628
)

 
We performed an impairment review of our investment portfolio as of January 25, 2015. Factors considered included general market conditions, the duration and extent to which fair value is below cost, and our intent and ability to hold an investment for a sufficient period of time to allow for recovery in value. We also consider specific adverse conditions related to the financial health of and business outlook for an investee, including industry and sector performance, changes in technology, operational and financing cash flow factors, and changes in an investee’s credit rating. Investments that we identify as having an indicator of impairment are subject to further analysis to determine if the investment was other than temporarily impaired. Based on our quarterly impairment review and having considered the guidance in the relevant accounting literature, we concluded that our investments were appropriately valued and that no other than temporary impairment charges were necessary on our portfolio of available for sale investments as of January 25, 2015. 
 
As of January 25, 2015, we had nine investments that were in an unrealized loss position with total unrealized losses amounting to $2.4 million and with a duration of less than one year. The gross unrealized losses related to fixed income securities were due to changes in interest rates. We have determined that the gross unrealized losses on investment securities at January 25, 2015 are temporary in nature. Currently, we have the intent and ability to hold our investments with impairment indicators until maturity.

Net realized gains were $0.1 million, $2.4 million and $0.5 million for fiscal years 2015, 2014, and 2013, respectively.  As of January 25, 2015, we had a net unrealized gain of $8.4 million, which was comprised of gross unrealized gains of $11.0 million, offset by $2.6 million of gross unrealized losses. As of January 26, 2014, we had a net unrealized gain of $4.8 million, which was comprised of gross unrealized gains of $7.2 million, offset by $2.4 million of gross unrealized losses.

The amortized cost and estimated fair value of cash equivalents and marketable securities which are primarily debt instruments are classified as available-for-sale at January 25, 2015 and January 26, 2014 and are shown below by contractual maturity.

 
January 25, 2015
 
January 26, 2014
 
Amortized
Cost
 
Estimated
Fair Value
 
Amortized
Cost
 
Estimated
Fair Value
 
(In thousands)
Less than one year
$
1,570,233

 
$
1,570,622

 
$
1,883,132

 
$
1,883,753

Due in 1 - 5 years
2,719,852

 
2,725,945

 
2,114,289

 
2,117,387

Mortgage-backed securities issued by government-sponsored enterprises not due at a single maturity date
122,893

 
124,828

 
90,472

 
91,508

Total
$
4,412,978

 
$
4,421,395

 
$
4,087,893

 
$
4,092,648

Fair Value of Financial Assets and Liabilities
Fair Value of Financial Assets and Liabilities
Fair Value of Financial Assets and Liabilities

Financial assets measured at fair value

We measure our cash equivalents and marketable securities at fair value. The fair values of our financial assets and liabilities are determined using quoted market prices of identical assets or quoted market prices of similar assets from active markets. Our Level 1 assets consist of our money market funds. We classify securities within Level 1 assets when the fair value is obtained from real time quotes for transactions in active exchange markets involving identical assets. Our available-for-sale securities are classified as having Level 2 inputs. Our Level 2 assets are valued utilizing a market approach where the market prices of similar assets are provided by a variety of independent industry standard data providers to our investment custodian. We review the fair value hierarchy classification on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. There were no significant transfers between Levels 1 and 2 assets for the year ended January 25, 2015. Level 3 assets are based on unobservable inputs to the valuation methodology and include our own data about assumptions market participants would use in pricing the asset or liability based on the best information available under the circumstances. Most of our cash equivalents and marketable securities are valued based on Level 2 inputs. We did not have any investments classified as Level 3 as of January 25, 2015.
 
Financial assets measured at fair value are summarized below:
 
 
 
Fair Value Measurement at Reporting Date Using 
 
 
 
Quoted Prices in Active Markets for Identical Assets
 
Significant Other Observable Inputs
 
January 25, 2015
 
(Level 1)
 
(Level 2)
 
(In thousands)
Debt securities of United States government agencies (1)
$
750,320

 
$
—

 
$
750,320

Corporate debt securities (2)
2,186,311

 
—

 
2,186,311

Mortgage backed securities issued by United States government-sponsored enterprises (3)
278,105

 
—

 
278,105

Money market funds (4)
132,495

 
132,495

 
—

Debt securities issued by United States Treasury (3)
536,364

 
—

 
536,364

Asset-backed securities (3)
452,884

 
—

 
452,884

Foreign government bonds (3)
84,916

 
—

 
84,916

Total assets
$
4,421,395

 
$
132,495


$
4,288,900


(1)
Includes $15.0 million in Cash Equivalents and $735.3 million in Marketable Securities on the Consolidated Balance Sheet.
(2)
Includes $147.2 million in Cash Equivalents and $2.0 billion in Marketable Securities on the Consolidated Balance Sheet.
(3)
Included in Marketable Securities on the Consolidated Balance Sheet.
(4)
Included in Cash Equivalents on the Consolidated Balance Sheet.
 
Financial liabilities measured at fair value

We issued $1.50 billion Convertible Senior Notes, or Notes, in December 2013. The Notes are carried at their original issuance value, net of unamortized debt discount, and are not marked to market each period. The estimated fair value of the Notes was $1,679.6 million and $1,528.4 million, respectively, as of January 25, 2015 and January 26, 2014. The estimated fair value of the Notes was determined on the basis of market prices observable for similar instruments and is considered Level 2 in the fair value hierarchy. Please refer to Note 11 of these Notes to the Consolidated Financial Statements for further information regarding the Notes.
Balance Sheet Components
Balance Sheet Components
Balance Sheet Components
 
Certain balance sheet components are as follows:
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Inventories:
 
 
 
Raw materials
$
156,846

 
$
126,896

Work in-process
91,778

 
94,844

Finished goods
234,269

 
166,025

     Total inventories
$
482,893

 
$
387,765



 
January 25,
2015
 
January 26,
2014
 
Estimated
Useful Life
 
(In thousands)
 
(In years)
Property and Equipment:
 
 
 
 
 
Land
$
218,496

 
$
218,496

 
(A)
Building
19,268

 
19,268

 
5-25
Test equipment
397,319

 
412,862

 
3-5
Software and licenses
112,967

 
120,435

 
3-5
Leasehold improvements
173,691

 
178,884

 
(B)
Computer equipment
152,733

 
204,344

 
3
Office furniture and equipment
48,692

 
58,874

 
5
Capital leases
28,481

 
28,481

 
(B)
Construction in process
27,610

 
41,176

 
(C)
Total property and equipment, gross
1,179,257

 
1,282,820

 
 
Accumulated depreciation and amortization
(621,975
)
 
(700,080
)
 
 
     Total property and equipment, net
$
557,282

 
$
582,740

 
 
(A) Land is a non-depreciable asset.
(B) Leasehold improvements and capital leases are amortized based on the lesser of either the asset’s estimated useful life or the remaining expected lease term.
(C) Construction in process represents assets that are not in service as of the balance sheet date.

Depreciation expense for fiscal years 2015, 2014 and 2013 was $143.1 million, $164.0 million and $157.6 million, respectively.

Accumulated amortization of leasehold improvements and capital leases was $139.6 million and $146.4 million at January 25, 2015 and January 26, 2014, respectively. Amortization of leasehold improvements and capital leases is included in depreciation and amortization expense.
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Accrued Liabilities:
 
 
 
Deferred revenue (1)
$
292,735

 
$
268,808

Customer related liabilities (2)
146,724

 
163,945

Accrued payroll and related expenses
112,173

 
109,721

Professional service fees
17,025

 
13,572

Facilities related liabilities
7,603

 
5,216

Warranty accrual (3)
7,523

 
7,571

Taxes payable, short- term
2,810

 
2,378

Coupon interest on Notes
2,542

 
2,500

Accrued legal settlement (4)
—

 
30,600

Other
13,672

 
16,794

Total accrued liabilities and other
$
602,807

 
$
621,105

(1)  The increase in fiscal year 2015 compared to fiscal year 2014 was due primarily to higher volumes with certain distributors.
(2)  This includes primarily accrued customer programs. Please refer to Note 1 of these Notes to the Consolidated Financial Statements for discussion regarding the nature of accrued customer programs and their accounting treatment related to our revenue recognition policies and estimates.
(3)  Please refer to Note 10 of these Notes to the Consolidated Financial Statements for discussion regarding the warranty accrual.
(4)  Please refer to Note 4 and Note 12 of these Notes to the Consolidated Financial Statements for discussion regarding the 3dfx litigation.
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Other Long Term Liabilities:
 
 
 
Deferred income tax liability
$
232,307

 
$
157,953

Income tax payable
120,961

 
119,977

Deferred revenue
107,838

 
172,199

Asset retirement obligations
7,428

 
11,056

Other
20,394

 
13,940

Total other long-term liabilities
$
488,928

 
$
475,125

Guarantees
Guarantees
Guarantees
 
U.S. GAAP requires that upon issuance of a guarantee, the guarantor must recognize a liability for the fair value of the obligation it assumes under that guarantee. In addition, U.S. GAAP requires disclosures about the guarantees that an entity has issued, including a tabular reconciliation of the changes of the entity’s product warranty liabilities.
 
Accrual for Product Warranty Liabilities

We record a reduction to revenue for estimated product returns at the time revenue is recognized primarily based on historical return rates. Cost of revenue includes the estimated cost of product warranties. Under limited circumstances, we may offer an extended limited warranty to customers for certain products. Additionally, we accrue for known warranty and indemnification issues if a loss is probable and can be reasonably estimated. During periods prior to fiscal year 2013, we recorded a cumulative net charge of $475.9 million, most of which was charged against cost of revenue, to cover customer warranty, repair, return, replacement and other costs arising from a weak die/packaging material set in certain versions of our previous generation MCP and GPU products used in notebook configurations. During fiscal year 2014, we released the remaining $7.8 million unclaimed balance of that warranty accrual.

The estimated product returns and estimated product warranty liabilities for fiscal years 2015, 2014 and 2013 are as follows:
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Balance at beginning of period (1)
$
7,571

 
$
14,874

 
$
18,406

Additions
5,441

 
6,786

 
5,738

Deductions (2)
(5,489
)
 
(14,089
)
 
(9,270
)
Balance at end of period 
$
7,523

 
$
7,571

 
$
14,874

 
(1)  Includes a balance of $9.6 million and $13.2 million for fiscal years 2014 and 2013, respectively, for the remaining amount of the warranty accrual associated with incremental repair and replacement costs from a weak die/packaging material set, which we recorded prior to fiscal year 2013.
(2) Includes $1.8 million and $3.0 million for fiscal years 2014 and 2013, respectively, in payments related to weak die/packaging set warranty accrual recorded prior to fiscal year 2013, and $7.8 million related to the release of the final unclaimed portion of that accrual during fiscal year 2014.
In connection with certain agreements that we have executed in the past, we have at times provided indemnities to cover the indemnified party for matters such as tax, product and employee liabilities. We have also on occasion included intellectual property indemnification provisions in our technology related agreements with third parties. Maximum potential future payments cannot be estimated because many of these agreements do not have a maximum stated liability. As such, we have not recorded any liability in our Consolidated Financial Statements for such indemnifications.
Long-term debt (Notes)
Debt Disclosure [Text Block]
Long-Term Debt

1.00 % Convertible Senior Notes Due 2018

On December 2, 2013, we issued $1.50 billion of the Notes. The Notes are unsecured, unsubordinated obligations of the Company, which pay interest in cash semi-annually at a rate of 1.00% per annum. The Notes will mature on December 1, 2018 unless earlier repurchased or converted in accordance with their terms prior to such date. The Notes may be converted, under the conditions specified below, based on an initial conversion rate of 49.60 shares of common stock per $1,000 principal amount of Notes (equivalent to an initial conversion price of $20.16 per share of common stock), subject to adjustment as described in the indenture governing the Notes.

Holders may convert their notes at their option at any time prior to August 1, 2018 only under the following circumstances: (1) during any fiscal quarter commencing after the fiscal quarter ended on April 27, 2014 (and only during such fiscal quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the measurement period) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after August 1, 2018 to the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes regardless of the foregoing conditions. Upon conversion, we will pay cash up to the aggregate principal amount of the notes to be converted and pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, in respect of the remainder, if any, of our conversion obligation in excess of the aggregate principal amount of the notes being converted.

As of January 25, 2015, none of the conditions allowing holders of the Notes to convert had been met. The determination of whether or not the Notes are convertible must be performed quarterly. If the Notes become convertible at the option of the holder, the difference between the principal amount and the carrying value of the Notes would be reflected as convertible debt in the mezzanine equity section on our Consolidated Balance Sheets.

In accordance with ASC 470-20 Debt with Conversion and Other Options, all cash-settled convertible debt should be separated into debt and equity components at issuance and be assigned a fair value. The value assigned to the debt component is the estimated fair value, as of the issuance date, of a similar debt without the conversion feature. The difference between the net cash proceeds and this estimated fair value, represents the value assigned to the equity component and is recorded as a debt discount. The debt discount is amortized using the effective interest method from the origination date through its stated contractual maturity date.

The initial debt component of the Notes was valued at $1,351.8 million based on the contractual cash flows discounted at an appropriate market rate for a non-convertible debt at the date of issuance, which was determined to be 3.15%. The carrying value of the permanent equity component reported in additional paid-in-capital was valued at $125.7 million and recorded as a debt discount. This amount, together with the $22.5 million purchaser's discount to the par value of the Notes represents the total unamortized debt discount of $148.2 million we recorded at the time of issuance of the Notes. The aggregate debt discount is amortized as interest expense over the contractual term of the Notes using the effective interest method using an interest rate of 3.15%.

The following table presents the carrying amounts of the liability and equity components:
 
January 25, 2015
 
January 26, 2014
 
(In thousands)
Amount of the equity component
$
125,725

 
$
125,725

 
 
 
 
1.00% convertible senior notes due 2018
$
1,500,000

 
$
1,500,000

Unamortized debt discount (1)
(115,658
)
 
(143,625
)
Net carrying amount
$
1,384,342

 
$
1,356,375

(1) As of January 25, 2015, the remaining period over which the unamortized debt discount will be amortized is 3.9 years.
The following table presents the interest expense for the contractual interest and the accretion of debt discount:
 
Year Ended
 
January 25, 2015
 
January 26, 2014
 
(In thousands)
Contractual coupon interest expense
$
15,000

 
$
2,500

Amortization of debt discount
27,967

 
4,600

Amortization of debt issuance costs
195

 
34

Total interest expense related to Notes
$
43,162

 
$
7,134


Note Hedges and Warrants

The net proceeds from the Notes were approximately $1,477.5 million after payment of the initial purchaser's discount. Concurrently with the offering of the Notes, we entered into the Note Hedges with a strike price equal to the initial conversion price of the Notes, or approximately $20.16 per share. The Note Hedges allow us to receive shares of our common stock and/or cash related to the excess conversion value that we would pay to the holders of the Notes upon conversion. We paid $167.1 million for the Note Hedges.

In addition, concurrent with the offering of the Notes and the purchase of the Note Hedges, we entered into a separate warrant transaction, or the Warrants, with a strike price to the holders of the Warrants of $27.14 per share. The Warrants are net share settled and cover, subject to customary antidilution adjustments, 74.4 million shares of our common stock. We received $59.1 million for the Warrants transaction.

The $108.0 million net cost of the Note Hedges offset by the proceeds from the Warrants was included as a net reduction to additional paid-in capital in the shareholders’ equity section of our consolidated balance sheets, in accordance with the guidance in ASC 815-40 Derivatives and Hedging-Contracts in Entity's Own Equity.
Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies
 
Inventory Purchase Obligations
 
At January 25, 2015, we had outstanding inventory purchase obligations totaling $456.0 million.

Capital Purchase Obligations
 
At January 25, 2015, we had outstanding capital purchase obligations totaling $51.0 million.
 
Lease Obligations

Our headquarters complex is located in Santa Clara, California and includes eight buildings that are leased properties. Future minimum lease payments related to headquarters operating leases total $73.1 million over the remaining terms of the leases, including predetermined rent escalations, and are included in the future minimum lease payment schedule below.
    
In addition to the commitment of our headquarters, we have other domestic and international office facilities under operating leases expiring through fiscal year 2025. We also include non-cancelable obligations under certain software licensing arrangements as operating leases.

Future minimum lease payments under our non-cancelable operating leases as of January 25, 2015, are as follows:   
 
Future Minimum Lease Obligations
 
(In thousands)
Fiscal Year:
 
2016
$
76,741

2017
66,242

2018
34,070

2019
26,793

2020
9,988

2021 and thereafter
27,477

Total
$
241,311


 
Rent expense for the years ended January 25, 2015, January 26, 2014 and January 27, 2013 was $47.3 million, $43.8 million and $38.4 million, respectively.

Capital lease obligations include building and office equipment lease obligations. The building lease relates to our datacenter in Santa Clara, California. Future minimum lease payments under the building capital lease total $20.9 million over the remaining lease term, including predetermined rent escalations, and are included in the future minimum lease payment schedule below:
 
Future Capital Lease Obligations
 
(In thousands)
Fiscal Year:
 

2016
$
5,303

2017
5,453

2018
5,607

2019
5,767

2020
26

2021 and thereafter
—

Total
$
22,156

Present value of minimum lease payments
$
17,500

 
 
Current portion
$
3,414

Long-term portion
$
14,086


 
Litigation
 
3dfx

On December 15, 2000, NVIDIA and one of our indirect subsidiaries entered into an Asset Purchase Agreement, or APA, to purchase certain graphics chip assets from 3dfx. The transaction closed on April 18, 2001. In October 2002, 3dfx filed for bankruptcy.

Following the bankruptcy, in March 2003, the Trustee appointed by the Bankruptcy Court to represent 3dfx's bankruptcy estate served a complaint on NVIDIA asserting claims for, among other things, successor liability and fraudulent transfer and seeking additional payments from us. The Trustee's fraudulent transfer theory alleged that NVIDIA had failed to pay reasonably equivalent value for 3dfx's assets, and sought recovery of the difference between the $70.0 million paid and the alleged fair value, which difference the Trustee estimated to exceed $50.0 million. The Trustee's successor liability theory alleged NVIDIA was effectively 3dfx's legal successor and therefore was responsible for all of 3dfx's unpaid liabilities.

In early November 2005, after several months of mediation, NVIDIA and the Official Committee of Unsecured Creditors, or the Creditors' Committee, agreed to a Plan of Liquidation of 3dfx, which included a conditional settlement of the Trustee's claims against us. This conditional settlement was subject to a confirmation process through a vote of creditors and the review and approval of the Bankruptcy Court. The conditional settlement never progressed substantially through the confirmation process.

In March 2007, a trial was held regarding certain valuation issues in the Trustee's constructive fraudulent transfer claims against NVIDIA. On April 30, 2008, the Bankruptcy Court issued its Memorandum Decision After Trial, in which it provided a detailed summary of the trial proceedings and the parties' contentions and evidence and concluded that “the creditors of 3dfx were not injured by the Transaction.” This decision did not entirely dispose of the Trustee's action, however, as the Trustee's claims for successor liability and intentional fraudulent conveyance were still pending. On June 19, 2008, NVIDIA filed a motion for summary judgment to convert the Memorandum Decision After Trial to a final judgment. That motion was granted in its entirety and judgment was entered in NVIDIA's favor on September 11, 2008. The Trustee filed a Notice of Appeal from that judgment on September 22, 2008, and on September 25, 2008, NVIDIA exercised its election to have the appeal heard by the United States District Court.

On December 20, 2010, the District Court issued an Order affirming the Bankruptcy Court's entry of summary judgment in NVIDIA's favor, and on January 19, 2011, the Trustee filed a Notice of Appeal to the United States Court of Appeals for the Ninth Circuit. Oral argument on the appeal was held on October 8, 2014. On November 6, 2014, the Ninth Circuit affirmed the District Court’s decision upholding the ruling of the Bankruptcy Court and the case concluded on February 5, 2015.

Securities Cases

In September 2008, three putative securities class actions were filed in the United States District Court for the Northern District of California arising out of our announcements on July 2, 2008, that we would take a charge against cost of revenue to cover anticipated costs and expenses arising from a weak die/packaging material set in certain versions of our previous generation MCP and GPU products and that we were revising financial guidance for our second quarter of fiscal year 2009. The actions purport to be brought on behalf of purchasers of NVIDIA stock and assert claims for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended.

On January 22, 2010, Plaintiffs filed a Consolidated Amended Class Action Complaint, asserting claims for violations of Section 10(b), Rule 10b-5, and Section 20(a) of the Securities Exchange Act and seeking unspecified compensatory damages. We moved to dismiss the consolidated complaint and on October 19, 2010, Judge Seeborg granted our motion with leave to amend. On December 2, 2010, Plaintiffs filed a Second Consolidated Amended Complaint. We again moved to dismiss and on October 12, 2011, Judge Seeborg again granted our motion to dismiss, this time denying Plaintiffs leave to amend. On November 8, 2011, Plaintiffs filed a Notice of Appeal to the Ninth Circuit. Oral argument was held on January 14, 2014. On October 2, 2014, the Ninth Circuit issued an order affirming the dismissal. On October 16, 2014, Plaintiffs requested a rehearing or en banc review of the Ninth Circuit’s opinion affirming the dismissal. Plaintiffs’ request was denied on November 10, 2014. On February 9, 2015, Plaintiffs filed a petition for writ of certiorari to the United States Supreme Court.

Patent Infringement Cases

On September 4, 2014, NVIDIA filed complaints against Qualcomm, Inc., or Qualcomm, and various Samsung entities with both the United States International Trade Commission, or ITC, and the United States District Court for the District of Delaware for alleged infringement of seven patents relating to graphics processing. In the ITC action, NVIDIA seeks to block shipments of Samsung Galaxy mobile phones and tablets containing Qualcomm’s Adreno, ARM’s Mali or Imagination’s PowerVR graphics architectures. On October 6, 2014, the ITC initiated an investigation of NVIDIA’s claim and the investigation is currently underway. On February 2 and 3, 2015, the court conducted a claim construction hearing on certain claim language from five of the patents at issue. A decision on claim construction is expected in March 2015.

In the Delaware action, NVIDIA seeks unspecified damages for Samsung and Qualcomm’s alleged patent infringement. On October 22, 2014, Samsung and Qualcomm moved to stay the Delaware proceedings in light of the pending ITC action. The court granted the motion to stay on October 23, 2014.

On November 10, 2014, Samsung filed a complaint against NVIDIA and Velocity Micro, Inc., in the United States District Court for the Eastern District of Virginia, alleging that NVIDIA infringed six patents and falsely advertised that the Tegra K1 processor is the world’s fastest mobile processor. On December 19, 2014, Samsung filed an amended, longer complaint but asserting the same claims against NVIDIA. Samsung seeks unspecified damages and an injunction prohibiting NVIDIA from any future violations. NVIDIA answered the amended complaint on January 26, 2015 and filed an amended answer on March 3, 2015. On January 12, 2015, NVIDIA moved to transfer the action to the Northern District of California and to sever and stay the proceedings against Velocity Micro, Inc. Briefing on the motion to transfer is now complete and submitted to the court for decision.

Accounting for Loss Contingencies

While there can be no assurance of favorable outcomes, we believe the claims made by other parties in the above ongoing matters are without merit and we intend to vigorously defend the actions. As of January 25, 2015, we have not recorded any accrual for contingent liabilities associated with the legal proceedings described above based on our belief that liabilities, while possible, are not probable. Further, any possible range of loss in these matters cannot be reasonably estimated at this time. We are engaged in other legal actions not described above arising in the ordinary course of its business and, while there can be no assurance of favorable outcomes, we believe that the ultimate outcome of these actions will not have a material adverse effect on our operating results, liquidity or financial position.
Income Taxes
Income Taxes
Income Taxes
 
The income tax expense applicable to income before income taxes consists of the following:
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Current income taxes:
 
 
 
 
 
Federal
$
7,995

 
$
7,896

 
$
7,506

State
818

 
1,234

 
1,016

Foreign
17,356

 
18,513

 
16,766

Total current
26,169

 
27,643

 
25,288

Deferred taxes:
 
 
 
 
 
Federal
83,827

 
17,070

 
28,143

State
—

 
—

 
—

Foreign
(1,258
)
 
(1,640
)
 
3,717

Total deferred
82,569

 
15,430

 
31,860

Charge in lieu of taxes attributable to employer stock option plans
15,511

 
27,191

 
42,355

Income tax expense
$
124,249

 
$
70,264

 
$
99,503


 
Income before income tax consists of the following:
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Domestic
$
173,865

 
$
79,136

 
$
99,422

Foreign
580,971

 
431,118

 
562,617

Income before income tax
$
754,836

 
$
510,254

 
$
662,039


 
The income tax expense differs from the amount computed by applying the federal statutory income tax rate of 35% to income before income taxes as follows:
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Tax expense computed at federal statutory rate
$
264,192

 
$
178,589

 
$
231,714

State income taxes, net of federal tax effect
681

 
1,608

 
1,048

Foreign tax rate differential
(119,786
)
 
(93,831
)
 
(123,626
)
U.S. federal R&D tax credit
(34,319
)
 
(30,155
)
 
(29,294
)
Stock-based compensation
4,332

 
8,900

 
11,876

Tax expense related to intercompany transaction
9,785

 
9,785

 
9,785

Other
(636
)
 
(4,632
)
 
(2,000
)
Income tax expense
$
124,249

 
$
70,264

 
$
99,503


The tax effect of temporary differences that gives rise to significant portions of the deferred tax assets and liabilities are presented below:  
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Deferred tax assets:
 
Net operating loss carryforwards
$
72,322

 
$
81,629

Accruals and reserves, not currently deductible for tax purposes
109,123

 
131,932

Property, equipment and intangible assets
45,593

 
48,358

Research and other tax credit carryforwards
350,655

 
306,975

Stock-based compensation
29,850

 
33,135

Convertible debt
12,327

 
14,885

Gross deferred tax assets
619,870

 
616,914

Less valuation allowance
(260,985
)
 
(244,487
)
Total deferred tax assets
358,885

 
372,427

Deferred tax liabilities:
 
 
 
Acquired intangibles
(24,463
)
 
(33,244
)
Unremitted earnings of foreign subsidiaries
(500,031
)
 
(425,401
)
Gross deferred tax liabilities
(524,494
)
 
(458,645
)
Net deferred tax liability
$
(165,609
)
 
$
(86,218
)


We recognized income tax expense of $124.2 million, $70.3 million and $99.5 million during fiscal years 2015, 2014 and 2013, respectively. Income tax expense as a percentage of income before taxes, or our annual effective tax rate, was 16.5% in fiscal year 2015, 13.8% in fiscal year 2014 and 15.0% in fiscal year 2013. The difference in the effective tax rates amongst the three years was primarily due to an increase in the amount of earnings subject to United States tax in fiscal year 2015 and a higher percentage of research tax credit benefit in fiscal year 2014.

Our effective tax rate on income before tax for the fiscal years was lower than the United States federal statutory rate of 35% due to income earned in jurisdictions, including British Virgin Islands, Hong Kong, China, Taiwan and United Kingdom, where the tax rate is lower, favorable recognition of the U.S. federal research tax credit and release of tax reserves as a result of the expiration of statutes of limitations in certain non-U.S. jurisdictions for which we had not previously recognized related tax benefits. 
 
As of January 25, 2015 and January 26, 2014 we had a valuation allowance of $261.0 million and $244.5 million, respectively, related to state and certain foreign deferred tax assets that management determined not likely to be realized due, in part, to projections of future taxable income. To the extent realization of the deferred tax assets becomes more-likely-than-not, we would recognize such deferred tax asset as an income tax benefit during the period.

Our deferred tax assets do not include the excess tax benefit related to stock-based compensation that are a component of our federal and state net operating loss and research tax credit carryforwards in the amount of $411.9 million as of January 25, 2015. Consistent with prior years, the excess tax benefit reflected in our net operating loss and research tax credit carryforwards will be accounted for as a credit to shareholders' equity, if and when realized.
 
As of January 25, 2015, we had federal, state and foreign net operating loss carryforwards of $521.5 million, $667.2 million and $332.6 million, respectively. The federal and state carryforwards will expire beginning in fiscal year 2022 and 2016, respectively. The foreign net operating loss carryforwards of $316.7 million may be carried forward indefinitely and the remainder of $15.9 million will begin to expire in fiscal year 2016. As of January 25, 2015, we had federal research tax credit carryforwards of $429.6 million that will begin to expire in fiscal year 2018. We have state research tax credit carryforwards of $411.7 million, of which $395.9 million is attributable to the State of California and may be carried over indefinitely, and $15.8 million is attributable to various other states and will expire beginning in fiscal year 2016. We have other state tax credit carryforwards of $3.0 million that will expire in fiscal year 2026 and foreign tax credit carryforwards of $18.4 million, which may be refunded in fiscal years 2016 through 2019 if not utilized. Our tax attributes, net operating loss and tax credit carryforwards, remain subject to audit and may be adjusted for changes or modification in tax laws, other authoritative interpretations thereof, or other facts and circumstances. Utilization of federal, state, and foreign net operating losses and tax credit carryforwards may also be subject to limitations due to ownership changes and other limitations provided by the Internal Revenue Code and similar state and foreign tax provisions. If any such limitations apply, the federal, states, or foreign net operating loss and tax credit carryforwards, as applicable, may expire or be denied before utilization.

As of January 25, 2015, U.S. federal and state income taxes have not been provided on approximately $2.27 billion of undistributed earnings of non-United States subsidiaries as such earnings are considered to be indefinitely reinvested. We have not provided the amount of unrecognized deferred tax liabilities for temporary differences related to investments in our foreign subsidiaries as the determination of such amount is not practicable.
 
As of January 25, 2015, we had $253.7 million of gross unrecognized tax benefits, of which $228.7 million would affect our effective tax rate if recognized. However, approximately $45.3 million of the unrecognized tax benefits were related to state income tax positions taken, that, if recognized, would be in the form of a carryforward deferred tax asset that would likely attract a full valuation allowance. The $228.7 million of unrecognized tax benefits as of January 25, 2015 consisted of $106.6 million recorded in non-current income taxes payable and $122.1 million reflected as a reduction to the related deferred tax assets.

A reconciliation of gross unrecognized tax benefits is as follows:
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Balance at beginning of period
$
237,738

 
$
220,543

 
$
138,262

Increases in tax positions for prior years
—

 
—

 
18,800

Decreases in tax positions for prior years
(871
)
 
(714
)
 
(304
)
Increases in tax positions for current year
22,865

 
22,787

 
67,764

Lapse in statute of limitations
(5,997
)
 
(4,878
)
 
(3,979
)
Balance at end of period
$
253,735

 
$
237,738

 
$
220,543



We classify an unrecognized tax benefit as a current liability, or as a reduction of the deferred tax assets or amount refundable, to the extent that we anticipate payment or receipt of cash for income taxes within one year. Likewise, the amount is classified as a long-term liability, reduction of long-term deferred tax assets or amount refundable, if we anticipate payment or receipt of cash for income taxes during a period beyond a year.

Our policy is to include interest and penalties related to unrecognized tax benefits as a component of income tax expense. As of January 25, 2015, January 26, 2014, and January 27, 2013, we had accrued $14.4 million, $12.9 million and $11.3 million, respectively, for the payment of interest and penalties related to unrecognized tax benefits, which is not included as a component of our unrecognized tax benefits. As of January 25, 2015, non-current income taxes payable of $121.0 million consisted of unrecognized tax benefits of $106.6 million and the related interest and penalties of $14.4 million.

While we believe that we have adequately provided for all tax positions, amounts asserted by tax authorities could be greater or less than our accrued position. Accordingly, our provisions on federal, state and foreign tax-related matters to be recorded in the future may change as revised estimates are made or the underlying matters are settled or otherwise resolved. As of January 25, 2015, we do not believe that our estimates, as otherwise provided for, on such tax positions will significantly increase or decrease within the next twelve months.

We are subject to taxation by a number of taxing authorities both in the United States and throughout the world. As of January 25, 2015, the material tax jurisdictions that may be subject to examination include the United States, Taiwan, Canada, China, Germany, Hong Kong, France, Japan, and India for fiscal years 2003 through 2014. As of January 25, 2015, the material tax jurisdictions for which we are currently under examination include the state of California for fiscal years 2011 through 2012, and India, France and Germany for fiscal years 2003 through 2014.
Stockholders' Equity
Stockholders' Equity
Shareholders’ Equity

Share Repurchase Program

Beginning August 2004, our Board of Directors authorized us, subject to certain specifications, to repurchase shares of our common stock. Most recently, in November 2013, the Board extended the previously authorized repurchase program through January 2016 and authorized an additional $1.00 billion for an aggregate of $3.70 billion under the repurchase program.

During fiscal year 2015, we repurchased a total of 44.4 million shares of our common stock for $813.6 million and paid $186.5 million in cash dividends - equivalent to $0.085 per share on a quarterly basis, or $0.34 per share on an annual basis - to our common shareholders. As a result, we returned $1.0 billion to shareholders during fiscal year 2015 in the form of share repurchases and dividend payments.

Through the end of fiscal year 2015, we have repurchased an aggregate of 205.6 million shares under our share repurchase program for a total cost of $3,265.2 million. All shares delivered from these repurchases have been placed into treasury stock. As of January 25, 2015, we are authorized, subject to certain specifications, to repurchase shares of our common stock up to $434.8 million through January 2016.

On November 6, 2014, we announced our intention to return approximately $600.0 million to our shareholders in fiscal year 2016 through a combination of share repurchases and cash dividends. On February 11, 2015, we declared that we would pay our next quarterly cash dividend of $0.085 per share on March 19, 2015, to all shareholders of record on February 26, 2015.

In addition to our Board authorized share repurchases, we withhold common stock shares associated with net share settlements to cover tax withholding obligations upon the vesting of RSU and PSU awards under our equity incentive program. During fiscal year 2015, we withheld approximately 2.3 million shares at a total cost of $43.7 million through net share settlements. Please refer to Note 2 of these Notes to the Consolidated Financial Statements for further information regarding stock-based compensation related to equity awards granted under our equity incentive programs.

Convertible Preferred Stock

As of January 25, 2015 and January 26, 2014, there were no shares of preferred stock outstanding.
Employee Retirement Plans
Pension and Other Postretirement Benefits Disclosure
Employee Retirement Plans
 
We have a 401(k) Retirement Plan covering substantially all of our United States employees. Under the plan, participating employees may defer up to 100% of their pre-tax earnings, subject to the Internal Revenue Service annual contribution limits. Effective January 2013, we began matching a portion of the employee contributions. Our contribution expense in fiscal years 2015 and 2014 was $5.8 million and $5.1 million, respectively. We also have defined contribution retirement plans outside of the United States to which we contributed $19.7 million, $16.2 million and $16.7 million for fiscal years 2015, 2014 and 2013, respectively.
Segment Information
Segment Information
Segment Information 
Our Chief Executive Officer, who is considered to be our chief operating decision maker, or CODM, reviews financial information presented on an operating segment basis for purposes of making operating decisions and assessing financial performance. Our operating segments are equivalent to our reportable segments.

We report our business in two primary reporting segments - the GPU business and the Tegra Processor business - based on a single underlying graphics architecture.

Our GPU product brands aimed at specialized markets include GeForce for gamers; Quadro for designers; Tesla for researchers, deep learning and big-data analysts; and GRID for cloud-based visual computing users.

We also integrate our GPUs into tiny mobile chips called system-on-a-chip (SOC) processors, which power tablets, and automotive infotainment and safety systems. Our Tegra brand integrates an entire computer onto a single chip, incorporating GPUs and multi-core CPUs with audio, video and input/output capabilities. They can also be integrated with baseband processors to add voice and data communication. Tegra conserves power while delivering state-of-the-art graphics and multimedia processing.

We have a single unifying architecture for our GPU and Tegra Processors. This architecture unification leverages our visual computing expertise by charging the operating expenses of certain core engineering functions to the GPU business, while charging the Tegra Processor business for the incremental cost of the teams working directly for that business. In instances where the operating expenses of certain functions benefit both reporting segments, our CODM assigns 100% of those expenses to the reporting segment that benefits the most. The revenue and cost of revenue of the reporting segments was not affected, and comparative periods presented below reflect the impact of this change.

The “All Other” category presented below represents the revenue and expenses that our CODM does not assign to either the GPU business or the Tegra Processor business for purposes of making operating decisions or assessing financial performance. The revenue includes primarily patent licensing revenue and the expenses include corporate infrastructure and support costs, stock-based compensation costs, amortization of acquisition-related intangible assets, other acquisition-related costs, and other non-recurring charges and benefits that our CODM deems to be enterprise in nature.


Our CODM does not review any information regarding total assets on a reporting segment basis. Reporting segments do not record intersegment revenue, and, accordingly, there is none to be reported. The accounting policies for segment reporting are the same as for NVIDIA as a whole. The table below presents details of our reportable segments and the “All Other” category.
 
GPU
 
Tegra Processor
 
All Other
 
Consolidated
 
(In thousands)
Year Ended January 25, 2015:
 
 
 
 
 
 
 
Revenue
$
3,838,906

 
$
578,601

 
$
264,000

 
$
4,681,507

Depreciation and amortization expense
$
116,683

 
$
57,282

 
$
46,160

 
$
220,125

Operating income (loss)
$
1,113,350

 
$
(254,435
)
 
$
(99,926
)
 
$
758,989

Year Ended January 26, 2014:
 
 
 
 
 
 
 
Revenue
$
3,468,144

 
$
398,018

 
$
264,000

 
$
4,130,162

Depreciation and amortization expense
$
146,571

 
$
49,839

 
$
42,738

 
$
239,148

Operating income (loss)
$
834,763

 
$
(268,068
)
 
$
(70,468
)
 
$
496,227

Year Ended January 27, 2013:
 
 
 
 
 
 
 
Revenue
$
3,251,712

 
$
764,447

 
$
264,000

 
$
4,280,159

Depreciation and amortization expense
$
143,262

 
$
40,793

 
$
42,180

 
$
226,235

Operating income (loss)
$
694,338

 
$
40,508

 
$
(86,607
)
 
$
648,239

 
 
Year Ended
 
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
 
(In thousands)
Reconciling items included in "All Other" category:
 
 
 
 
Revenue not allocated to reporting segments
 
$
264,000

 
$
264,000

 
$
264,000

Unallocated corporate operating expenses and other expenses
 
(168,730
)
 
(166,483
)
 
(157,680
)
Stock-based compensation
 
(157,841
)
 
(136,295
)
 
(136,662
)
Acquisition-related costs, net
 
(37,355
)
 
(31,652
)
 
(36,138
)
Other non-recurring expenses and benefits
 
—

 
(38
)
 
(20,127
)
Total
 
$
(99,926
)
 
$
(70,468
)
 
$
(86,607
)

Revenue by geographic region is allocated to individual countries based on the location to which the products are initially billed even if our customers’ revenue is attributable to end customers that are located in a different location. The following tables summarize information pertaining to our revenue from customers based on invoicing address in different geographic regions: 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
Revenue:
(In thousands)
Taiwan
$
1,594,435

 
$
1,321,503

 
$
1,356,838

China
922,121

 
793,790

 
780,493

United States
790,614

 
726,830

 
799,430

Other Asia Pacific
637,029

 
675,339

 
783,573

Europe
368,921

 
295,160

 
263,488

Other Americas
368,387

 
317,540

 
296,337

Total revenue
$
4,681,507

 
$
4,130,162

 
$
4,280,159

The following table presents summarized information for long-lived assets by geographic region. Long-lived assets consist of property and equipment and deposits and other assets, and exclude goodwill and intangible assets.
 
January 25,
2015
 
January 26,
2014
Long-lived assets:
(In thousands)
United States
$
467,277

 
$
522,461

Taiwan
52,176

 
51,993

Europe
51,521

 
50,677

India
48,544

 
31,456

China
28,073

 
29,313

Other Asia Pacific
587

 
1,092

Total long-lived assets
$
648,178

 
$
686,992



Revenue from significant customers, those representing 10% or more of total revenue for the respective dates, is summarized as follows:
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
Revenue:
 
 
 
 
 
Customer A
11
%
 
11
%
 
13
%
Customer B
9
%
 
10
%
 
9
%

Revenue from customer A was attributable to both the GPU and Tegra Processor businesses, while revenue from customer B was attributable to the GPU business.

Accounts receivable from significant customers, those representing 10% or more of total accounts receivable for the respective periods, is summarized as follows: 
 
January 25,
2015
 
January 26,
2014
Accounts Receivable:
 
 
 
Customer B
20
%
 
23
%
Customer C
10
%
 
9
%
Quartely Summary
Quarterly Financial Information
Quarterly Summary (Unaudited)
 
The following table sets forth our unaudited consolidated financial results, for the last eight fiscal quarters:
 
Fiscal Year 2015
Quarters Ended
 
January 25,
2015
 
October 26,
2014
 
July 27,
2014
 
April 27,
2014
 
(In thousands, except per share data)
Statement of Income Data:
 
 
 
 
 
 
 
Revenue
$
1,250,514

 
$
1,225,382

 
$
1,102,824

 
$
1,102,787

Cost of revenue
$
550,911

 
$
548,684

 
$
483,850

 
$
498,585

Gross profit
$
699,603

 
$
676,698

 
$
618,974

 
$
604,202

Net income
$
193,128

 
$
172,967

 
$
127,976

 
$
136,516

Net income per share:
 
 
 
 
 
 
 
Basic
$
0.35

 
$
0.32

 
$
0.23

 
$
0.24

Diluted
$
0.35

 
$
0.31

 
$
0.22

 
$
0.24


 
Fiscal Year 2014
Quarters Ended
 
January 26,
2014
 
October 27,
2013
 
July 28,
2013
 
April 28,
2013
 
(In thousands, except per share data)
Statement of Income Data:
 
 
 
 
 
 
 
Revenue
$
1,144,218

 
$
1,053,967

 
$
977,238

 
$
954,739

Cost of revenue
$
524,976

 
$
469,552

 
$
431,700

 
$
436,171

Gross profit
$
619,242

 
$
584,415

 
$
545,538

 
$
518,568

Net income
$
146,917

 
$
118,734

 
$
96,448

 
$
77,891

Net income per share:
 
 
 
 
 
 
 
Basic
$
0.26

 
$
0.20

 
$
0.16

 
$
0.13

Diluted
$
0.25

 
$
0.20

 
$
0.16

 
$
0.13

Schedule II
Schedule of Valuation and Qualifying Accounts Disclosure
SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS
 
Description
 
Balance at
Beginning of Period
 
Additions
 
Deductions
 
Balance at
End of Period
 
 
(In thousands)
Year ended January 25, 2015
 
 
 
 
 
 
 
 
Allowance for doubtful accounts
 
$
848

 
$
2,837

(1)
$
(793
)
(1)
$
2,892

Sales return allowance
 
$
14,111

 
$
12,427

(2)
$
(12,447
)
(4)
$
14,091

Deferred tax valuation allowance
 
$
244,487

 
$
16,498

(3)
$
—

 
$
260,985

Year ended January 26, 2014
 
 
 
 
 
 
 
 
Allowance for doubtful accounts
 
$
1,804

 
$
309

(1)
$
(1,265
)
(1)
$
848

Sales return allowance
 
$
14,790

 
$
15,881

(2)
$
(16,560
)
(4)
$
14,111

Deferred tax valuation allowance
 
$
224,774

 
$
19,713

(3)
$
—

 
$
244,487

Year ended January 27, 2013
 
 
 
 
 
 
 
 
Allowance for doubtful accounts
 
$
973

 
$
1,139

(1)
$
(308
)
(1)
$
1,804

Sales return allowance
 
$
13,881

 
$
16,533

(2)
$
(15,624
)
(4)
$
14,790

Deferred tax valuation allowance
 
$
212,285

 
$
12,489

(3)
$
—

 
$
224,774

 
(1)  Additions represent allowance for doubtful accounts charged to expense and deductions represent amounts recorded as reduction to expense upon reassessment of allowance for doubtful accounts at period end.
(2) Represents allowance for sales returns estimated at the time revenue is recognized primarily based on historical return rates and is charged as a reduction to revenue.
(3)  Represents change in valuation allowance primarily related to state and certain foreign deferred tax assets that management has determined not likely to be realized due, in part, to projections of future taxable income of the respective jurisdictions.
(4) Represents allowance for sales returns written off.
Summary of Significant Accounting Policies (Policies)
Nature of Operations [Text Block] 
Our Company

NVIDIA is dedicated to advancing visual computing. We enable individuals to interact with digital ideas, data and entertainment with an ease and efficiency unmatched by any other communication medium.

Our two reporting segments - GPU and Tegra Processor - are based on a single underlying graphics architecture.

Our GPU product brands aimed at specialized markets include GeForce for gamers; Quadro for designers; Tesla for researchers, deep learning and big-data analysts; and GRID for cloud-based visual computing users.

We also integrate our GPUs into tiny mobile chips called system-on-a-chip (SOC) processors, which power tablets, and automotive infotainment and safety systems. Our Tegra brand integrates an entire computer onto a single chip, incorporating GPUs and multi-core CPUs with audio, video and input/output capabilities. They can also be integrated with baseband processors to add voice and data communication. Tegra conserves power while delivering state-of-the-art graphics and multimedia processing.

Headquartered in Santa Clara, California, NVIDIA was incorporated in California in April 1993 and reincorporated in Delaware in April 1998.

All references to “NVIDIA,” “we,” “us,” “our” or the “Company” mean NVIDIA Corporation and its subsidiaries, except where it is made clear that the term means only the parent company.

Fiscal Period, Policy [Policy Text Block] 
Fiscal Year
 
We operate on a 52- or a 53-week year, ending on the last Sunday in January. Fiscal years 2015, 2014 and 2013 were 52-week years.
Reclassification, Policy [Policy Text Block] 
Reclassifications

Certain prior fiscal year balances have been reclassified to conform to the current fiscal year presentation.
Consolidation, Policy [Policy Text Block] 
Principles of Consolidation
 
Our consolidated financial statements include the accounts of NVIDIA Corporation and its wholly-owned subsidiaries. All material intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates, Policy [Policy Text Block] 
Use of Estimates
 
The preparation of financial statements in conformity with accounting principles generally accepted in the United States, or U.S. GAAP, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. On an on-going basis, we evaluate our estimates, including those related to revenue recognition, inventories, income taxes, goodwill, cash equivalents and marketable securities, stock-based compensation, and litigation, investigation and settlement costs and other contingencies. These estimates are based on historical facts and various other assumptions that we believe are reasonable.
Revenue Recognition 
Revenue Recognition
 
Product Revenue

We recognize revenue from product sales when persuasive evidence of an arrangement exists, the product has been delivered, the price is fixed or determinable and collection of the related receivable is reasonably assured. For most sales, we use a binding purchase order and in certain cases we use a contractual agreement as evidence of an arrangement. We consider delivery to occur upon shipment provided title and risk of loss have passed to the customer. At the point of sale, we assess whether the arrangement fee is fixed or determinable and whether collection is reasonably assured. If we determine that collection of a fee is not reasonably assured, we defer the fee and recognize revenue at the time collection becomes reasonably assured, which is generally upon receipt of payment.
For sales to certain distributors with rights of return for which the level of returns cannot be reasonably estimated, our policy is to defer recognition of revenue and related cost of revenue until the distributors resell the product and, in some cases, when customer return rights lapse.
Our customer programs primarily involve rebates, which are designed to serve as sales incentives to resellers of our products in various target markets. We account for rebates as a reduction of revenue and recognize a liability for these rebates at the later of the date at which we record the related revenue or the date at which we offer the rebate. Unclaimed rebates are reversed to revenue.
Our customer programs also include marketing development funds, or MDFs.  MDFs represent monies paid to retailers, system builders, original equipment manufacturers, or OEMs, distributors, add-in card partners and other channel partners that are earmarked for market segment development and expansion and typically are designed to support our partners’ activities while also promoting NVIDIA products. We account for MDFs as a reduction of revenue and apply a breakage factor to certain types of MDF programs.

We also record a reduction to revenue by establishing a sales return allowance for estimated product returns at the time revenue is recognized, based primarily on historical return rates. However, if product returns for a particular fiscal period exceed historical return rates we may determine that additional sales return allowances are required to properly reflect our estimated exposure for product returns.

License and Development Revenue

For license arrangements that require significant customization of our intellectual property components, we generally recognize the related revenue over the period that services are performed. For most license and service arrangements, we determine progress to completion based on actual direct labor hours incurred to date as a percentage of the estimated total direct labor hours required to complete the project. A provision for estimated losses on contracts is made in the period in which the loss becomes probable and can be reasonably estimated. Costs incurred in advance of revenue recognized are recorded as deferred costs on uncompleted contracts. If the amount billed exceeds the amount of revenue recognized, the excess amount is recorded as deferred revenue.

For license arrangements that do not require significant customization but where we are obligated to provide further deliverables over the term of the license agreement, we record revenue over the life of the license term, with consideration received in advance of the performance period classified as deferred revenue.

Royalty revenue is recognized related to the distribution or sale of products that use our technologies under license agreements with third parties.  We recognize royalty revenue upon receipt of a confirmation of earned royalties and when collectability is reasonably assured from the applicable licensee.

Research and Development Expense

Research and development expense includes the conceptual formulation, design, and testing of product alternatives, construction of prototypes, and operation of pilot plants Research and development costs are charged to expense as incurred.
Advertising Costs, Policy [Policy Text Block] 
Advertising Expenses

We expense advertising costs in the period in which they are incurred. Advertising expenses for fiscal years 2015, 2014 and 2013 were $14.6 million, $13.1 million and $9.2 million, respectively.
Lease, Policy [Policy Text Block] 
Rent Expense
 
We recognize rent expense on a straight-line basis over the lease period and accrue for rent expense incurred, but not paid.
Commitments and Contingencies, Policy [Policy Text Block] 
Product Warranties
 
We generally offer limited warranty to end-users that ranges from one to three years for products in order to repair or replace products for any manufacturing defects or hardware component failures. Cost of revenue includes the estimated cost of product warranties that are calculated at the point of revenue recognition. Under limited circumstances, we may offer an extended limited warranty to customers for certain products. We also accrue for known warranty and indemnification issues if a loss is probable and can be reasonably estimated.
Compensation Related Costs, Policy [Policy Text Block] 
Stock-based Compensation
      
We estimate the fair value of employee stock options on the date of grant using a binomial model and recognize the expense using a straight-line attribution method over the requisite employee service period. We use the closing trading price of our common stock on the date of grant, minus a dividend yield discount, as the fair value of awards of restricted stock units, or RSUs, and performance stock units, or PSUs. The compensation expense for the RSUs is recognized using a straight-line attribution method over the requisite employee service period while compensation expense for PSUs is recognized using an accelerated amortization model. We estimate the fair value of shares to be issued under our employee stock purchase plan, or ESPP, using the Black-Scholes model at the commencement of an offering period in March and September of each year. Stock-based compensation for our ESPP is expensed using an accelerated amortization model.
Legal Costs, Policy [Policy Text Block] 
Litigation, Investigation and Settlement Costs

From time to time, we are involved in legal actions and/or investigations by regulatory bodies. We are aggressively defending our current litigation matters. However, there are many uncertainties associated with any litigation or investigation, and we cannot be certain that these actions or other third-party claims against us will be resolved without litigation, fines and/or substantial settlement payments. If that occurs, our business, financial condition and results of operations could be materially and adversely affected. If information becomes available that causes us to determine that a loss in any of our pending litigation, investigations or settlements is probable, and we can reasonably estimate the loss associated with such events, we will record the loss in accordance with U.S. GAAP. However, the actual liability in any such litigation or investigation may be materially different from our estimates, which could require us to record additional costs.
Foreign Currency Transactions and Translations Policy [Policy Text Block] 
Foreign Currency Remeasurement
 
We use the United States dollar as our functional currency for all of our subsidiaries. Foreign currency monetary assets and liabilities are remeasured into United States dollars at end-of-period exchange rates. Non-monetary assets and liabilities such as property and equipment, and equity are remeasured at historical exchange rates. Revenue and expenses are remeasured at average exchange rates in effect during each period, except for those expenses related to the previously noted balance sheet amounts, which are remeasured at historical exchange rates. Gains or losses from foreign currency remeasurement are included in “Other income (expense), net” in our Consolidated Statements of Income and to date have not been significant.

The impact of gain or loss from foreign currency remeasurement included in determining other income (expense), net for fiscal years 2015, 2014 and 2013 was $0.5 million, $4.7 million and $(1.5) million, respectively.
Income Tax, Policy [Policy Text Block] 
Income Taxes
 
We recognize federal, state and foreign current tax liabilities or assets based on our estimate of taxes payable or refundable in the current fiscal year by tax jurisdiction. We recognize federal, state and foreign deferred tax assets or liabilities, as appropriate, for our estimate of future tax effects attributable to temporary differences and carryforwards; and we record a valuation allowance to reduce any deferred tax assets by the amount of any tax benefits that, based on available evidence and judgment, are not expected to be realized.

United States income tax has not been provided on a portion of earnings of our non-U.S. subsidiaries to the extent that such earnings are considered to be indefinitely reinvested.

Our calculation of current and deferred tax assets and liabilities is based on certain estimates and judgments and involves dealing with uncertainties in the application of complex tax laws. Our estimates of current and deferred tax assets and liabilities may change based, in part, on added certainty or finality to an anticipated outcome, changes in accounting standards or tax laws in the United States, or foreign jurisdictions where we operate, or changes in other facts or circumstances. In addition, we recognize liabilities for potential United States and foreign income tax contingencies based on our estimate of whether, and the extent to which, additional taxes may be due. If we determine that payment of these amounts is unnecessary or if the recorded tax liability is less than our current assessment, we may be required to recognize an income tax benefit or additional income tax expense in our financial statements accordingly.

As of January 25, 2015, we had a valuation allowance of $261.0 million related to state and certain foreign deferred tax assets that management determined are not likely to be realized due, in part, to projections of future taxable income and potential utilization limitations of tax attributes acquired as a result of stock ownership changes.  To the extent realization of the deferred tax assets becomes more-likely-than-not, we would recognize such deferred tax asset as an income tax benefit during the period.

Our deferred tax assets do not include the excess tax benefit related to stock-based compensation that are a component of our federal and state net operating loss and research tax credit carryforwards in the amount of $411.9 million as of January 25, 2015. Consistent with prior years, the excess tax benefit reflected in our net operating loss and research tax credit carryforwards will be accounted for as a credit to shareholders' equity, if and when realized. In determining if and when excess tax benefits have been realized, we have elected to utilize the with-and-without approach with respect to such excess tax benefits. We have also elected to ignore the indirect tax effects of stock-based compensation deductions for financial and accounting reporting purposes, and specifically to recognize the full effect of the research tax credit in income from operations.
 
We recognize the benefit from a tax position only if it is more-likely-than-not that the position would be sustained upon audit based solely on the technical merits of the tax position. Our policy is to include interest and penalties related to unrecognized tax benefits as a component of income tax expense. Please refer to Note 13 of these Notes to the Consolidated Financial Statements for additional information.

Comprehensive Income, Policy [Policy Text Block] 
Comprehensive Income
 
Comprehensive income consists of net income and other comprehensive income (loss). Other comprehensive income (loss) components include unrealized gains (losses) on available-for-sale securities, net of tax.
Earnings Per Share, Policy [Policy Text Block] 
Net Income Per Share
 
Basic net income per share is computed using the weighted average number of common shares outstanding during the period. Diluted net income per share is computed using the weighted average number of common and potentially dilutive shares outstanding during the period, using the treasury stock method. Under the treasury stock method, the effect of stock options outstanding is not included in the computation of diluted net income per share for periods when their effect is anti-dilutive. Additionally, we issued convertible notes with a net settlement feature that requires us, upon conversion, to settle the principal amount of debt for cash and the conversion premium for cash or shares of our common stock. Our convertible notes, note hedges, and related warrants contain various conversion features, which are further described in Note 11 of these Notes to the Consolidated Financial Statements. The potentially dilutive shares resulting from the convertible notes and warrants under the treasury stock method will be included in the calculation of diluted income per share when their inclusion is dilutive. However, unless actually exercised, the note hedges will not be included in the calculation of diluted net income per share, as their pre-exercised effect would be anti-dilutive under the treasury stock method.
Cash and Cash Equivalents, Policy [Policy Text Block] 
Cash and Cash Equivalents
 
We consider all highly liquid investments that are readily convertible into cash and have an original maturity of three months or less at the time of purchase to be cash equivalents. As of January 25, 2015 and January 26, 2014, our cash and cash equivalents were $496.7 million and $1,151.6 million, respectively, which include $132.5 million and $307.9 million invested in money market funds for fiscal year 2015 and fiscal year 2014, respectively.
Marketable Securities, Policy [Policy Text Block] 
Marketable Securities
 
Marketable securities consist primarily of highly liquid investments with maturities of greater than three months when purchased. We generally classify our marketable securities at the date of acquisition as available-for-sale. These securities are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income, a component of shareholders’ equity, net of tax. The fair value of interest-bearing securities includes accrued interest. Any unrealized losses which are considered to be other-than-temporary impairments are recorded in the other income and expense section of our consolidated statements of income. Realized gains and losses on the sale of marketable securities are determined using the specific-identification method and recorded in the other income and expense section of our consolidated statements of income.

All of our available-for-sale investments are subject to a periodic impairment review. We record a charge to earnings when a decline in fair value is significantly below cost basis and judged to be other-than-temporary, or have other indicators of impairments. If the fair value of an available-for-sale debt instrument is less than its amortized cost basis, an other-than-temporary impairment is triggered in circumstances where (1) we intend to sell the instrument, (2) it is more likely than not that we will be required to sell the instrument before recovery of its amortized cost basis, or (3) a credit loss exists where we do not expect to recover the entire amortized cost basis of the instrument. In these situations, we recognize an other-than-temporary impairment in earnings equal to the entire difference between the debt instruments’ amortized cost basis and its fair value. For available-for-sale debt instruments that are considered other-than-temporarily impaired due to the existence of a credit loss, if we do not intend to sell and it is not more likely than not that we will not be required to sell the instrument before recovery of its remaining amortized cost basis (amortized cost basis less any current-period credit loss), we separate the amount of the impairment into the amount that is credit related and the amount due to all other factors. The credit loss component is recognized in earnings while loss related to all other factors is recorded as other comprehensive income.
 
Investment, Policy [Policy Text Block] 
Fair Value of Financial Instruments
 
The carrying value of cash equivalents, accounts receivable, accounts payable and accrued liabilities approximate their fair values due to their relatively short maturities as of January 25, 2015 and January 26, 2014. Marketable securities are comprised of available-for-sale securities that are reported at fair value with the related unrealized gains and losses included in accumulated other comprehensive income, a component of shareholders’ equity, net of tax. Fair value of the marketable securities is determined based on quoted market prices.
Concentration Risk, Credit Risk, Policy [Policy Text Block] 
Concentration of Credit Risk
 
Financial instruments that potentially subject us to concentrations of credit risk consist primarily of cash equivalents, marketable securities, accounts receivable and the note hedge. Our investment policy requires the purchase of high grade investment securities, the diversification of asset type and includes certain limits on our portfolio duration. All marketable securities are held in our name, managed by several investment managers and held by one major financial institution under a custodial arrangement. Accounts receivable from significant customers, those representing 10% or more of total accounts receivable, aggregated approximately 30% of our accounts receivable balance from two customers at January 25, 2015 and approximately 23% of our accounts receivable balance from one customer at January 26, 2014. We perform ongoing credit evaluations of our customers’ financial condition and maintain an allowance for potential credit losses. This allowance consists of an amount identified for specific customers and an amount based on overall estimated exposure. Our overall estimated exposure excludes amounts covered by credit insurance and letters of credit.
Receivables, Policy [Policy Text Block] 
Accounts Receivable
 
We maintain an allowance for doubtful accounts receivable for estimated losses resulting from the inability of our customers to make required payments. We determine this allowance, which consists of an amount identified for specific customer issues as well as an amount based on overall estimated exposure. Factors impacting the allowance include the level of gross receivables, the financial condition of our customers and the extent to which balances are covered by credit insurance or letters of credit.
Inventories 
Inventories

Inventory cost is computed on an adjusted standard basis, which approximates actual cost on an average or first-in, first-out basis. Inventory costs consist primarily of the cost of semiconductors purchased from subcontractors, including wafer fabrication, assembly, testing and packaging, manufacturing support costs, including labor and overhead associated with such purchases, final test yield fallout, and shipping costs, as well as the cost of purchased memory products and other component parts. We charge cost of sales for inventory provisions to write down our inventory to the lower of cost or estimated market value or to completely write off obsolete or excess inventory. Most of our inventory provisions relate to the write-off of excess quantities of products, based on our inventory levels and future product purchase commitments compared to assumptions about future demand and market conditions. Once inventory has been written-off or written-down, it creates a new cost basis for the inventory that is not subsequently written-up.
Property, Plant and Equipment, Policy [Policy Text Block] 
Property and Equipment
 
Property and equipment are stated at cost. Depreciation of property and equipment is computed using the straight-line method based on the estimated useful lives of the assets, generally three to five years. Once an asset is identified for retirement or disposition, the related cost and accumulated depreciation or amortization are removed, and a gain or loss is recorded. The estimated useful lives of our buildings are up to twenty five years. Depreciation expense includes the amortization of assets recorded under capital leases. Leasehold improvements and assets recorded under capital leases are amortized over the shorter of the expected lease term or the estimated useful life of the asset.
Goodwill and Intangible Assets, Policy [Policy Text Block] 
Goodwill

Goodwill is subject to our annual impairment test during the fourth quarter of our fiscal year, or earlier if indicators of potential impairment exist.  For the purposes of completing our impairment test, we perform either a qualitative or a quantitative analysis on a reporting unit basis. 
For those reporting units where a significant change or event has occurred, where potential impairment indicators exist, or for which we have not performed a quantitative assessment recently, we utilize a two-step quantitative assessment to testing goodwill for impairment. The first step tests for possible impairment by applying a fair value-based test by weighing the results from the income approach and the market approach. The second step, if necessary, measures the amount of such impairment by applying fair value-based tests to individual assets and liabilities. Please refer to Note 5 of these Notes to the Consolidated Financial Statements for additional information. 

Intangible Assets

Intangible assets primarily represent rights acquired under technology licenses, patents, acquired intellectual property, trademarks and customer relationships and are subject to an annual impairment test. We currently amortize our intangible assets with definitive lives over periods ranging from one to ten years using a method that reflects the pattern in which the economic benefits of the intangible asset are consumed or otherwise used up or, if that pattern cannot be reliably determined, using a straight-line amortization method.
Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block] 
Impairment of Long-Lived Assets
 
Long-lived assets, such as property and equipment and intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset, or asset group may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset, or asset group to estimated undiscounted future cash flows expected to be generated by the asset, or asset group. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, an impairment charge is recognized for the amount by which the carrying amount of the asset or asset group exceeds the estimated fair value of the asset or asset group. Fair value is determined based on the estimated discounted future cash flows expected to be generated by the asset or asset group. Assets and liabilities to be disposed of would be separately presented in the consolidated balance sheet and the assets would be reported at the lower of the carrying amount or fair value less costs to sell, and would no longer be depreciated.
Asset Retirement Obligations and Environmental Cost, Policy [Policy Text Block] 
Accounting for Asset Retirement Obligations
 
We account for asset retirement obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. The accounting guidance applies to legal obligations associated with the retirement of long-lived assets that result from the acquisition, construction, development and/or normal use of the assets and requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The fair value of the liability is added to the carrying amount of the associated asset and this additional carrying amount is depreciated over the life of the asset. As of January 25, 2015 and January 26, 2014, our asset retirement obligations to return the leasehold improvements at our headquarters facility and certain laboratories at our domestic and international facilities to their original condition upon lease termination were $7.4 million and $11.1 million, respectively.
New Accounting Pronouncements, Policy [Policy Text Block] 
Adoption of New and Recently Issued Accounting Pronouncements

In May 2014, the FASB issued a new accounting standard update that creates a single source of revenue guidance under U.S. GAAP for all companies, in all industries. Under the new standard, recognition of revenue occurs when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, the new guidance requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers, including significant judgments and estimates used. This new guidance is effective for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period. Early adoption is not permitted. We will adopt this guidance either by using a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. We are currently evaluating the impact of this accounting guidance on our consolidated financial statements and have not yet determined which transition method we will apply.
Stock Based Compensation (Tables)
Stock-based compensation expense, net of amounts capitalized as inventory 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Cost of revenue
$
12,022

 
$
10,688

 
$
10,490

Research and development
88,355

 
82,940

 
82,157

Sales, general and administrative
57,464

 
42,667

 
44,015

Total
$
157,841

 
$
136,295

 
$
136,662

Summary of equity awards granted under equity incentive plans 
 
Year Ended
 
January 25,

January 26,
 
January 27,
2015

2014
 
2013
 
(In thousands, except per share data)
Stock Options
 
 
 
 
 
Awards granted
86


6,149


7,119

Estimated total grant-date fair value
$
345

 
$
21,310

 
$
38,326

Weighted average grant-date fair value (per share)
$
4.02

 
$
3.47

 
$
5.38

 
 
 
 
 
 
RSUs and PSUs
 
 
 
 
 
Awards granted
12,912

 
10,757

 
8,136

Estimated total grant-date fair value
$
228,223

 
$
144,798

 
$
112,795

Weighted average grant-date fair value (per share)
$
17.68

 
$
13.46

 
$
13.86

 
 
 
 
 
 
ESPP
 
 
 
 
 
Shares purchased
6,672

 
6,124

 
5,463

Weighted average price (per share)
$
10.99

 
$
10.79

 
$
10.83

Weighted average grant-date fair value (per share)
$
4.99

 
$
5.60

 
$
5.16

Summary of unearned stock-based compensation expense 
 
January 25,

January 26,
 
2015

2014
 
(In thousands)
Aggregated unearned stock-based compensation expense
$
291,416

 
$
256,500

 
 
 
 
Estimated weighted average amortization period
(In years)
Stock Options
1.8

 
2.5

RSUs and PSUs
2.8

 
2.7

ESPP
0.5

 
0.6

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(Using a binomial model)
Stock Options
 
 
 
 
 
Weighted average expected life (in years)
2.5-3.2
 
2.4-3.5
 
3.1-4.9
Risk-free interest rate
2.5%-2.8%
 
1.8%-3.0%
 
1.5%-2.3%
Volatility
31%
 
28%-37%
 
39%-49%
Dividend yield
1.8%-1.9%
 
1.9%-2.4%
 
2.4%

 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(Using the Black-Scholes model)
ESPP
 
 
 
 
 
Weighted average expected life (in years)
0.5-2.0
 
0.5-2.0
 
0.5-2.0

Risk-free interest rate
0.1%-0.5%
 
0.1%-0.4%
 
0.1%-0.3%

Volatility
23%-31%
 
32%-37%
 
44%-47%

Dividend yield
1.7%-1.9%
 
2.0%-2.4%
 
—

Schedule of Share-based Compensation, Activity 
 
Options Outstanding
 
RSUs and PSUs Outstanding
 
Number of
Shares
 
Weighted
Average
Exercise Price
Per Share
 
Weighted
Average
Remaining  
Contractual
Life
 
Aggregate
Intrinsic
Value (1)
 
Number of
Shares
 
Weighted
Average
Grant-Date
Fair Value
 
(In thousands, except years and per share data)
Balances, January 26, 2014
32,504

 
$
14.22

 
 
 
 
 
18,852

 
$
13.82

Granted (2)
86

 
$
18.75

 
 
 
 
 
12,912

 
$
17.68

Exercised
(9,795
)
 
$
12.64

 
 
 
 
 
—

 
—

Vested restricted stock
—

 
—

 
 
 
 
 
(7,163
)
 
$
13.78

Canceled and forfeited
(1,450
)
 
$
19.27

 
 
 
 
 
(1,326
)
 
$
14.44

Balances, January 25, 2015
21,345

 
$
14.61

 
5.9
 
$
130,923

 
23,275

 
$
15.94

Exercisable at January 25, 2015
15,120

 
$
14.70

 
5.1
 
$
91,434

 
 
 
 
Vested and expected to vest after January 25, 2015
20,356

 
$
14.62

 
5.8
 
$
124,575

 
18,988

 
$
15.96



(1)
The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value for in-the-money options at January 25, 2015, based on the $20.71 closing stock price of our common stock on the NASDAQ Global Select Market on January 23, 2015, the last trading day of fiscal year 2015, which would have been received by the option holders had all in-the-money option holders exercised their options as of that date. The total number of in-the-money options outstanding and exercisable as of January 25, 2015 was 21.1 million shares and 14.9 million shares, respectively.
(2)
Includes the total number of PSUs issuable if the maximum corporate financial performance target level for fiscal year 2015 is achieved. Depending on the actual level of achievement of the corporate performance target at the end of fiscal year 2015, the range of PSUs issued could be from 1.3 million to 2.5 million shares. The PSUs were granted during the first quarter of fiscal year 2015 to our CEO and senior management as approved by our Compensation Committee.

Net Income Per Share (Tables)
Reconciliation of numerators and denominators of basic and diluted net income (loss) per share computations
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands, except per share data)
Numerator:
 
 
 
 
 
Net income
$
630,587

 
$
439,990

 
$
562,536

Denominator:
 
 
 
 
 
Denominator for basic net income per share, weighted average shares
552,319

 
587,893

 
619,324

Effect of dilutive securities:
 
 
 
 
 
Stock awards outstanding
10,749

 
6,624

 
5,633

Denominator for diluted net income per share, weighted average shares
563,068

 
594,517

 
624,957

Net income per share:
 
 
 
 
 
Basic
$
1.14

 
$
0.75

 
$
0.91

Diluted
$
1.12

 
$
0.74

 
$
0.90

Potentially dilutive securities excluded from income per diluted share because their effect would have been anti-dilutive
11,807

 
25,630

 
26,784

Goodwill (Tables)
Goodwill
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Icera
$
271,186

 
$
271,186

PortalPlayer
104,896

 
104,896

3dfx
50,326

 
75,326

Mental Images
59,252

 
59,252

MediaQ
35,167

 
35,167

ULi
31,115

 
31,115

Hybrid Graphics
27,906

 
27,906

Ageia
19,198

 
19,198

Portland Group Inc.
2,149

 
2,149

Other
16,984

 
16,984

Total goodwill
$
618,179

 
$
643,179

Intangible Assets (Tables)
Amortizable Intangible Assets Components
 
January 25, 2015
 
January 26, 2014
 
Gross 
Carrying
Amount
 
Accumulated
Amortization
 
Net 
Carrying
Amount
 
Weighted Average
Useful Life
 
Gross 
Carrying
Amount
 
Accumulated
Amortization
 
Net 
Carrying
Amount
 
Weighted Average Useful Life
 
(In thousands)
 
(In years)
 
(In thousands)
 
(In years)
Acquisition-related intangible assets
$
189,239

 
$
(134,062
)
 
$
55,177

 
6.8
 
$
189,239

 
$
(114,104
)
 
$
75,135

 
6.5
Patents and licensed technology
448,873

 
(282,336
)
 
166,537

 
7.2
 
446,196

 
(225,319
)
 
220,877

 
7.2
Total intangible assets
$
638,112

 
$
(416,398
)
 
$
221,714

 
 
 
$
635,435

 
$
(339,423
)
 
$
296,012

 
 
Marketable Securities (Tables)
Cash Equivalents and Marketable Securities 
 
January 25, 2015
 
Amortized
Cost
 
Unrealized
Gain
 
Unrealized
Loss
 
Estimated
Fair Value
 
(In thousands)
Corporate debt securities
$
2,184,925

 
$
2,600

 
$
(1,214
)
 
$
2,186,311

Debt securities of United States government agencies
749,630

 
917

 
(227
)
 
750,320

Debt securities issued by United States Treasury
533,673

 
2,694

 
(3
)
 
536,364

Asset-backed securities
453,088

 
125

 
(329
)
 
452,884

Mortgage backed securities issued by United States government-sponsored enterprises
274,366

 
4,589

 
(850
)
 
278,105

Money market funds
132,495

 
—

 
—

 
132,495

Foreign government bonds
84,800

 
121

 
(5
)
 
84,916

Total
$
4,412,977

 
$
11,046

 
$
(2,628
)
 
$
4,421,395

Classified as:
 
 
 
 
 
 
 
Cash equivalents
 
 
 
 
 
 
$
294,710

Marketable securities
 
 
 
 
 
 
4,126,685

Total
 
 
 
 
 
 
$
4,421,395

 
 
January 26, 2014
 
Amortized
Cost
 
Unrealized
Gain
 
Unrealized
Loss
 
Estimated
Fair Value
 
(In thousands)
Corporate debt securities
$
1,762,833

 
$
1,837

 
$
(945
)
 
$
1,763,725

Debt securities of United States government agencies
1,012,740

 
848

 
(261
)
 
1,013,327

Debt securities issued by United States Treasury
495,889

 
621

 
(57
)
 
496,453

Money market funds
307,865

 
—

 
—

 
307,865

Asset-backed securities
258,017

 
15

 
(315
)
 
257,717

Mortgage backed securities issued by United States government-sponsored enterprises
185,594

 
3,837

 
(725
)
 
188,706

Foreign government bonds
64,955

 
20

 
(120
)
 
64,855

Total
$
4,087,893

 
$
7,178

 
$
(2,423
)
 
$
4,092,648

Classified as:
 
 
 
 
 
 
 
Cash equivalents
 
 
 
 
 
 
$
572,425

Marketable securities
 
 
 
 
 
 
3,520,223

Total
 
 
 
 
 
 
$
4,092,648

  
The following table provides the breakdown of the investments that were in a continuous unrealized loss position at January 25, 2015:
 
 
Less than 12 Months
 
12 Months or Greater
 
Total
 
Fair Value
 
Gross
Unrealized
Losses
 
Fair Value
 
Gross
Unrealized
Losses
 
Fair Value
 
Gross
Unrealized
Losses
 
(In thousands)
Corporate debt securities
$
709,392

 
$
(1,199
)
 
$
10,085

 
$
(15
)
 
$
719,477

 
$
(1,214
)
Mortgage backed securities issued by United States government-sponsored enterprises
81,245

 
(639
)
 
21,314

 
(211
)
 
102,559

 
(850
)
Debt securities of United States Treasury
10,026

 
(3
)
 
—

 
—

 
10,026

 
(3
)
Debt securities issued by United States government agencies
246,480

 
(227
)
 
—

 
—

 
246,480

 
(227
)
Asset-backed securities
306,066

 
(323
)
 
4,476

 
(6
)
 
310,542

 
(329
)
Foreign government bonds
11,008

 
(5
)
 
—

 
—

 
11,008

 
(5
)
Total
$
1,364,217

 
$
(2,396
)
 
$
35,875

 
$
(232
)
 
$
1,400,092

 
$
(2,628
)
Schedule of Cash Equivalents and Marketable Securities Available for Sale 
 
January 25, 2015
 
January 26, 2014
 
Amortized
Cost
 
Estimated
Fair Value
 
Amortized
Cost
 
Estimated
Fair Value
 
(In thousands)
Less than one year
$
1,570,233

 
$
1,570,622

 
$
1,883,132

 
$
1,883,753

Due in 1 - 5 years
2,719,852

 
2,725,945

 
2,114,289

 
2,117,387

Mortgage-backed securities issued by government-sponsored enterprises not due at a single maturity date
122,893

 
124,828

 
90,472

 
91,508

Total
$
4,412,978

 
$
4,421,395

 
$
4,087,893

 
$
4,092,648

Fair Value of Cash Equivalents and Marketable Securities (Tables)
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]
 
 
 
Fair Value Measurement at Reporting Date Using 
 
 
 
Quoted Prices in Active Markets for Identical Assets
 
Significant Other Observable Inputs
 
January 25, 2015
 
(Level 1)
 
(Level 2)
 
(In thousands)
Debt securities of United States government agencies (1)
$
750,320

 
$
—

 
$
750,320

Corporate debt securities (2)
2,186,311

 
—

 
2,186,311

Mortgage backed securities issued by United States government-sponsored enterprises (3)
278,105

 
—

 
278,105

Money market funds (4)
132,495

 
132,495

 
—

Debt securities issued by United States Treasury (3)
536,364

 
—

 
536,364

Asset-backed securities (3)
452,884

 
—

 
452,884

Foreign government bonds (3)
84,916

 
—

 
84,916

Total assets
$
4,421,395

 
$
132,495


$
4,288,900


(1)
Includes $15.0 million in Cash Equivalents and $735.3 million in Marketable Securities on the Consolidated Balance Sheet.
(2)
Includes $147.2 million in Cash Equivalents and $2.0 billion in Marketable Securities on the Consolidated Balance Sheet.
(3)
Included in Marketable Securities on the Consolidated Balance Sheet.
(4)
Included in Cash Equivalents on the Consolidated Balance Sheet.
Balance Sheet Components (Tables)
Inventories 
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Inventories:
 
 
 
Raw materials
$
156,846

 
$
126,896

Work in-process
91,778

 
94,844

Finished goods
234,269

 
166,025

     Total inventories
$
482,893

 
$
387,765

Property, Plant and Equipment 
 
January 25,
2015
 
January 26,
2014
 
Estimated
Useful Life
 
(In thousands)
 
(In years)
Property and Equipment:
 
 
 
 
 
Land
$
218,496

 
$
218,496

 
(A)
Building
19,268

 
19,268

 
5-25
Test equipment
397,319

 
412,862

 
3-5
Software and licenses
112,967

 
120,435

 
3-5
Leasehold improvements
173,691

 
178,884

 
(B)
Computer equipment
152,733

 
204,344

 
3
Office furniture and equipment
48,692

 
58,874

 
5
Capital leases
28,481

 
28,481

 
(B)
Construction in process
27,610

 
41,176

 
(C)
Total property and equipment, gross
1,179,257

 
1,282,820

 
 
Accumulated depreciation and amortization
(621,975
)
 
(700,080
)
 
 
     Total property and equipment, net
$
557,282

 
$
582,740

 
 
(A) Land is a non-depreciable asset.
(B) Leasehold improvements and capital leases are amortized based on the lesser of either the asset’s estimated useful life or the remaining expected lease term.
(C) Construction in process represents assets that are not in service as of the balance sheet date.
Accrued Liabilities 
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Accrued Liabilities:
 
 
 
Deferred revenue (1)
$
292,735

 
$
268,808

Customer related liabilities (2)
146,724

 
163,945

Accrued payroll and related expenses
112,173

 
109,721

Professional service fees
17,025

 
13,572

Facilities related liabilities
7,603

 
5,216

Warranty accrual (3)
7,523

 
7,571

Taxes payable, short- term
2,810

 
2,378

Coupon interest on Notes
2,542

 
2,500

Accrued legal settlement (4)
—

 
30,600

Other
13,672

 
16,794

Total accrued liabilities and other
$
602,807

 
$
621,105

(1)  The increase in fiscal year 2015 compared to fiscal year 2014 was due primarily to higher volumes with certain distributors.
(2)  This includes primarily accrued customer programs. Please refer to Note 1 of these Notes to the Consolidated Financial Statements for discussion regarding the nature of accrued customer programs and their accounting treatment related to our revenue recognition policies and estimates.
(3)  Please refer to Note 10 of these Notes to the Consolidated Financial Statements for discussion regarding the warranty accrual.
(4)  Please refer to Note 4 and Note 12 of these Notes to the Consolidated Financial Statements for discussion regarding the 3dfx litigation.
Other Long-term Liabilities 
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Other Long Term Liabilities:
 
 
 
Deferred income tax liability
$
232,307

 
$
157,953

Income tax payable
120,961

 
119,977

Deferred revenue
107,838

 
172,199

Asset retirement obligations
7,428

 
11,056

Other
20,394

 
13,940

Total other long-term liabilities
$
488,928

 
$
475,125

Guarantees (Tables)
Estimated Product Warranty Liabilities
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Balance at beginning of period (1)
$
7,571

 
$
14,874

 
$
18,406

Additions
5,441

 
6,786

 
5,738

Deductions (2)
(5,489
)
 
(14,089
)
 
(9,270
)
Balance at end of period 
$
7,523

 
$
7,571

 
$
14,874

 
(1)  Includes a balance of $9.6 million and $13.2 million for fiscal years 2014 and 2013, respectively, for the remaining amount of the warranty accrual associated with incremental repair and replacement costs from a weak die/packaging material set, which we recorded prior to fiscal year 2013.
(2) Includes $1.8 million and $3.0 million for fiscal years 2014 and 2013, respectively, in payments related to weak die/packaging set warranty accrual recorded prior to fiscal year 2013, and $7.8 million related to the release of the final unclaimed portion of that accrual during fiscal year 2014.
Long-term debt (Tables)
Schedule of Long-term Debt Instruments [Table Text Block]
 
January 25, 2015
 
January 26, 2014
 
(In thousands)
Amount of the equity component
$
125,725

 
$
125,725

 
 
 
 
1.00% convertible senior notes due 2018
$
1,500,000

 
$
1,500,000

Unamortized debt discount (1)
(115,658
)
 
(143,625
)
Net carrying amount
$
1,384,342

 
$
1,356,375

(1) As of January 25, 2015, the remaining period over which the unamortized debt discount will be amortized is 3.9 years.
The following table presents the interest expense for the contractual interest and the accretion of debt discount:
 
Year Ended
 
January 25, 2015
 
January 26, 2014
 
(In thousands)
Contractual coupon interest expense
$
15,000

 
$
2,500

Amortization of debt discount
27,967

 
4,600

Amortization of debt issuance costs
195

 
34

Total interest expense related to Notes
$
43,162

 
$
7,134

Commitments and Contingencies (Tables)
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block] 
 
Future Capital Lease Obligations
 
(In thousands)
Fiscal Year:
 

2016
$
5,303

2017
5,453

2018
5,607

2019
5,767

2020
26

2021 and thereafter
—

Total
$
22,156

Present value of minimum lease payments
$
17,500

 
 
Current portion
$
3,414

Long-term portion
$
14,086

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] 
 
Future Minimum Lease Obligations
 
(In thousands)
Fiscal Year:
 
2016
$
76,741

2017
66,242

2018
34,070

2019
26,793

2020
9,988

2021 and thereafter
27,477

Total
$
241,311

Income Taxes Income Taxes (Tables)
Summary of Income Tax Contingencies [Table Text Block] 
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Balance at beginning of period
$
237,738

 
$
220,543

 
$
138,262

Increases in tax positions for prior years
—

 
—

 
18,800

Decreases in tax positions for prior years
(871
)
 
(714
)
 
(304
)
Increases in tax positions for current year
22,865

 
22,787

 
67,764

Lapse in statute of limitations
(5,997
)
 
(4,878
)
 
(3,979
)
Balance at end of period
$
253,735

 
$
237,738

 
$
220,543

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block] 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Tax expense computed at federal statutory rate
$
264,192

 
$
178,589

 
$
231,714

State income taxes, net of federal tax effect
681

 
1,608

 
1,048

Foreign tax rate differential
(119,786
)
 
(93,831
)
 
(123,626
)
U.S. federal R&D tax credit
(34,319
)
 
(30,155
)
 
(29,294
)
Stock-based compensation
4,332

 
8,900

 
11,876

Tax expense related to intercompany transaction
9,785

 
9,785

 
9,785

Other
(636
)
 
(4,632
)
 
(2,000
)
Income tax expense
$
124,249

 
$
70,264

 
$
99,503

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block] 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Current income taxes:
 
 
 
 
 
Federal
$
7,995

 
$
7,896

 
$
7,506

State
818

 
1,234

 
1,016

Foreign
17,356

 
18,513

 
16,766

Total current
26,169

 
27,643

 
25,288

Deferred taxes:
 
 
 
 
 
Federal
83,827

 
17,070

 
28,143

State
—

 
—

 
—

Foreign
(1,258
)
 
(1,640
)
 
3,717

Total deferred
82,569

 
15,430

 
31,860

Charge in lieu of taxes attributable to employer stock option plans
15,511

 
27,191

 
42,355

Income tax expense
$
124,249

 
$
70,264

 
$
99,503

Schedule of Income before Income Tax, Domestic and Foreign [Table Text Block] 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
(In thousands)
Domestic
$
173,865

 
$
79,136

 
$
99,422

Foreign
580,971

 
431,118

 
562,617

Income before income tax
$
754,836

 
$
510,254

 
$
662,039

Schedule of Deferred Tax Assets and Liabilities [Table Text Block] 
 
January 25,
2015
 
January 26,
2014
 
(In thousands)
Deferred tax assets:
 
Net operating loss carryforwards
$
72,322

 
$
81,629

Accruals and reserves, not currently deductible for tax purposes
109,123

 
131,932

Property, equipment and intangible assets
45,593

 
48,358

Research and other tax credit carryforwards
350,655

 
306,975

Stock-based compensation
29,850

 
33,135

Convertible debt
12,327

 
14,885

Gross deferred tax assets
619,870

 
616,914

Less valuation allowance
(260,985
)
 
(244,487
)
Total deferred tax assets
358,885

 
372,427

Deferred tax liabilities:
 
 
 
Acquired intangibles
(24,463
)
 
(33,244
)
Unremitted earnings of foreign subsidiaries
(500,031
)
 
(425,401
)
Gross deferred tax liabilities
(524,494
)
 
(458,645
)
Net deferred tax liability
$
(165,609
)
 
$
(86,218
)
Segment Information (Tables)
Schedule of Segment Reporting Information, by Segment [Table Text Block] 
 
GPU
 
Tegra Processor
 
All Other
 
Consolidated
 
(In thousands)
Year Ended January 25, 2015:
 
 
 
 
 
 
 
Revenue
$
3,838,906

 
$
578,601

 
$
264,000

 
$
4,681,507

Depreciation and amortization expense
$
116,683

 
$
57,282

 
$
46,160

 
$
220,125

Operating income (loss)
$
1,113,350

 
$
(254,435
)
 
$
(99,926
)
 
$
758,989

Year Ended January 26, 2014:
 
 
 
 
 
 
 
Revenue
$
3,468,144

 
$
398,018

 
$
264,000

 
$
4,130,162

Depreciation and amortization expense
$
146,571

 
$
49,839

 
$
42,738

 
$
239,148

Operating income (loss)
$
834,763

 
$
(268,068
)
 
$
(70,468
)
 
$
496,227

Year Ended January 27, 2013:
 
 
 
 
 
 
 
Revenue
$
3,251,712

 
$
764,447

 
$
264,000

 
$
4,280,159

Depreciation and amortization expense
$
143,262

 
$
40,793

 
$
42,180

 
$
226,235

Operating income (loss)
$
694,338

 
$
40,508

 
$
(86,607
)
 
$
648,239

 
 
Year Ended
 
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
 
 
(In thousands)
Reconciling items included in "All Other" category:
 
 
 
 
Revenue not allocated to reporting segments
 
$
264,000

 
$
264,000

 
$
264,000

Unallocated corporate operating expenses and other expenses
 
(168,730
)
 
(166,483
)
 
(157,680
)
Stock-based compensation
 
(157,841
)
 
(136,295
)
 
(136,662
)
Acquisition-related costs, net
 
(37,355
)
 
(31,652
)
 
(36,138
)
Other non-recurring expenses and benefits
 
—

 
(38
)
 
(20,127
)
Total
 
$
(99,926
)
 
$
(70,468
)
 
$
(86,607
)
Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas [Table Text Block] 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
Revenue:
(In thousands)
Taiwan
$
1,594,435

 
$
1,321,503

 
$
1,356,838

China
922,121

 
793,790

 
780,493

United States
790,614

 
726,830

 
799,430

Other Asia Pacific
637,029

 
675,339

 
783,573

Europe
368,921

 
295,160

 
263,488

Other Americas
368,387

 
317,540

 
296,337

Total revenue
$
4,681,507

 
$
4,130,162

 
$
4,280,159

The following table presents summarized information for long-lived assets by geographic region. Long-lived assets consist of property and equipment and deposits and other assets, and exclude goodwill and intangible assets.
 
January 25,
2015
 
January 26,
2014
Long-lived assets:
(In thousands)
United States
$
467,277

 
$
522,461

Taiwan
52,176

 
51,993

Europe
51,521

 
50,677

India
48,544

 
31,456

China
28,073

 
29,313

Other Asia Pacific
587

 
1,092

Total long-lived assets
$
648,178

 
$
686,992

Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block] 
 
Year Ended
 
January 25,
2015
 
January 26,
2014
 
January 27,
2013
Revenue:
 
 
 
 
 
Customer A
11
%
 
11
%
 
13
%
Customer B
9
%
 
10
%
 
9
%

Schedule Of Accounts Receivable, Major Customers 
 
January 25,
2015
 
January 26,
2014
Accounts Receivable:
 
 
 
Customer B
20
%
 
23
%
Customer C
10
%
 
9
%
Quartely Summary (Tables)
Schedule of Quarterly Financial Information [Table Text Block]
 
Fiscal Year 2015
Quarters Ended
 
January 25,
2015
 
October 26,
2014
 
July 27,
2014
 
April 27,
2014
 
(In thousands, except per share data)
Statement of Income Data:
 
 
 
 
 
 
 
Revenue
$
1,250,514

 
$
1,225,382

 
$
1,102,824

 
$
1,102,787

Cost of revenue
$
550,911

 
$
548,684

 
$
483,850

 
$
498,585

Gross profit
$
699,603

 
$
676,698

 
$
618,974

 
$
604,202

Net income
$
193,128

 
$
172,967

 
$
127,976

 
$
136,516

Net income per share:
 
 
 
 
 
 
 
Basic
$
0.35

 
$
0.32

 
$
0.23

 
$
0.24

Diluted
$
0.35

 
$
0.31

 
$
0.22

 
$
0.24


 
Fiscal Year 2014
Quarters Ended
 
January 26,
2014
 
October 27,
2013
 
July 28,
2013
 
April 28,
2013
 
(In thousands, except per share data)
Statement of Income Data:
 
 
 
 
 
 
 
Revenue
$
1,144,218

 
$
1,053,967

 
$
977,238

 
$
954,739

Cost of revenue
$
524,976

 
$
469,552

 
$
431,700

 
$
436,171

Gross profit
$
619,242

 
$
584,415

 
$
545,538

 
$
518,568

Net income
$
146,917

 
$
118,734

 
$
96,448

 
$
77,891

Net income per share:
 
 
 
 
 
 
 
Basic
$
0.26

 
$
0.20

 
$
0.16

 
$
0.13

Diluted
$
0.25

 
$
0.20

 
$
0.16

 
$
0.13



Summary of Significant Accounting Policies (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Jan. 29, 2012
Accounting Policies [Abstract]
 
 
 
 
Advertising Expense
$ 14,600,000 
$ 13,100,000 
$ 9,200,000 
 
Foreign Currency Transaction Gain (Loss), Realized
500,000 
4,700,000 
(1,500,000)
 
Deferred Tax Assets, Valuation Allowance
(260,985,000)
(244,487,000)
 
 
Excess Tax Benefit Related To Stock Based Compensation
411,900,000 
 
 
 
Cash and cash equivalents
496,654,000 
1,151,587,000 
732,786,000 
667,876,000 
Accounts receivable from significant customers (in percent)
30.00% 
23.00% 
 
 
Asset Retirement Obligation
7,400,000 
11,100,000 
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
Available-for-sale Securities, Amortized Cost Basis
4,412,977,000 
4,087,893,000 
 
 
Money Market Funds
 
 
 
 
Schedule of Available-for-sale Securities [Line Items]
 
 
 
 
Available-for-sale Securities, Amortized Cost Basis
$ 132,495,000 
$ 307,865,000 
 
 
Stock Based Compensation (Details) (USD $)
Share data in Thousands, except Per Share data, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Stock based compensation
 
 
 
Cost of revenue
$ 12,022,000 
$ 10,688,000 
$ 10,490,000 
Research and development
88,355,000 
82,940,000 
82,157,000 
Sales, general and administrative
57,464,000 
42,667,000 
44,015,000 
Stock-based compensation
157,841,000 
136,295,000 
136,662,000 
Employee Service Share-based Compensation, Allocation of Recognized Period Costs, Capitalized Amount
100,000 
100,000 
400,000 
Summary of equity awards granted
 
 
 
Stock Options granted (in shares)
86 
6,149 
7,119 
Estimated total grant-date fair value of stock options
345,000 
21,310,000 
38,326,000 
Weighted average grant-date fair value per option
$ 4.02 
$ 3.47 
$ 5.38 
Restricted stock units granted (in shares)
12,912 1
10,757 
8,136 
Estimated total grant-date fair value of RSUs and PSUs
228,223,000 
144,798,000 
112,795,000 
Weighted average grant date fair value, RSUs and PSUs, granted
$ 17.68 
$ 13.46 
$ 13.86 
Shares purchased under ESPP
6,672 
6,124 
5,463 
Share-based Compensation Arrangement by Share-based Payment Award, Per Share Weighted Average Price of Shares Purchased
$ 10.99 
$ 10.79 
$ 10.83 
Weighted average grant date fair value of ESPP
$ 4.99 
$ 5.60 
$ 5.16 
Maximum issuable shares of PSUs, percentage
200.00% 
 
 
Share Based Compensation Expense Related To Equity Awards Not Expected To Vest
36,600,000 
29,700,000 
27,100,000 
Summary of unearned SBC expense
 
 
 
Aggregate amount of unearned stock-based compensation expense related to equity awards, adjusted for estimated forfeitures
$ 291,416,000 
$ 256,500,000 
 
Stock Options
 
 
 
Summary of unearned SBC expense
 
 
 
Estimated weighted average amortization period
1 year 9 months 18 days 
2 years 6 months 
 
Fair Value Assumptions
 
 
 
Expected life, minimum
2 years 6 months 0 days 
2 years 4 months 24 days 
3 years 1 month 6 days 
Expected life, maximum
3 years 2 months 12 days 
3 years 6 months 0 days 
4 years 10 months 24 days 
Risk free interest rate, minimum (in hundredths)
2.50% 
1.80% 
1.50% 
Risk free interest rate, maximum (in hundredths)
2.80% 
3.00% 
2.30% 
Volatility rate, minimum (in hundredths)
31.00% 
28.00% 
39.00% 
Volatility rate, maximum (in hundredths)
31.00% 
37.00% 
49.00% 
Dividend yield minimum
1.80% 
0.00% 
0.00% 
Dividend Yield maximum
1.90% 
2.40% 
2.40% 
Restricted Stock Units (RSUs)
 
 
 
Summary of unearned SBC expense
 
 
 
Estimated weighted average amortization period
2 years 9 months 17 days 
2 years 8 months 12 days 
 
Employee Stock Purchase Plan
 
 
 
Summary of unearned SBC expense
 
 
 
Estimated weighted average amortization period
0 years 6 months 0 days 
0 years 7 months 5 days 
 
Fair Value Assumptions
 
 
 
Expected life, minimum
0 years 6 months 0 days 
0 years 6 months 0 days 
0 years 6 months 0 days 
Expected life, maximum
2 years 0 months 0 days 
2 years 0 months 0 days 
2 years 0 months 0 days 
Risk free interest rate, minimum (in hundredths)
0.10% 
0.10% 
0.10% 
Risk free interest rate, maximum (in hundredths)
0.50% 
0.40% 
0.30% 
Volatility rate, minimum (in hundredths)
23.00% 
32.00% 
44.00% 
Volatility rate, maximum (in hundredths)
31.00% 
37.00% 
47.00% 
Dividend yield minimum
1.70% 
2.00% 
0.00% 
Dividend Yield maximum
1.90% 
2.40% 
0.00% 
Stock Based Compensation Equity Incentive Plans (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Amended and Restated 2007 Equity Incentive Plan
 
 
 
Increased number of shares by Amended 2007 Plan
10,000,000 
 
 
Number of shares may be issued under the Restated 2007 Plan
187,767,766 
 
 
Number of Shares Available for Grant
24,501,781 
24,700,000 
 
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period
4 years 0 months 0 days 
 
 
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage
25.00% 
 
 
Quarterly vesting schedule - options
6.25% 
 
 
Semi-annual vesting schedule - RSUs
12.50% 
 
 
Options expiration period
10 
 
 
1998 and 2012 employee Stock Purchase Plan
 
 
 
Number Of Shares Authorized Under1998 ESPP
 
 
78,000,000 
Stock Issued During Period, Shares, 1998 Plan, Prior to the effective date
 
 
54,567,667 
Maximum number of shares subject to outstanding purchase rights granted under the 1998 Plan that would have returned to the 1998 Plan
 
 
15,000,000 
Maximum shares available for future offerings under the 1998 Plan as of the effective date of the 2012 Plan
 
 
8,432,333 
Maximum Aggregated Number of Shares under 2012 ESPP
 
 
55,432,333 
Shares issued during period under 1998 Plan
 
8,819 
2,687,698 
Available but reserved shares for future issuance under 1998 Plan
 
 
183,000 
Shares remaining in the 1998 ESPP moved to the 2012 ESPP
 
174,181 
12,129,302 
Shares increased under Restated 2012 ESPP
12,500,000 
 
 
Shares purchased under ESPP
6,672,000 
6,124,000 
5,463,000 
Total shares purchased under 2012 ESPP
12,787,748 
 
 
Shares reserved for future issuance under 2012 Plan
52,448,068 
65,235,816 
 
Offering and purchase period under ESPP
24 months, which is divided into four purchase periods of six months 
 
 
Maximum employee subscription rate
10.00% 
 
 
Potential maximum employee subscription rate by BOD approval
15.00% 
 
 
Purchase price of ESPP, percent
85.00% 
 
 
Stock Options
 
 
 
Options, Outstanding, Number
21,345,000 
32,504,000 
 
Stock Options granted (in shares)
86,000 
6,149,000 
7,119,000 
Options, Exercises in Period
(9,795,000)
 
 
Options, Forfeitures in Period
(1,450,000)
 
 
Options, Outstanding, Weighted Average Exercise Price
$ 14.61 
$ 14.22 
 
Options, Grants in Period, Weighted Average Exercise Price
$ 18.75 
 
 
Options, Exercises in Period, Weighted Average Exercise Price
$ 12.64 
 
 
Options, Forfeitures in Period, Weighted Average Exercise Price
$ 19.27 
 
 
Options, Exercisable, Number
15,120,000 
 
 
Options, Exercisable, Weighted Average Exercise Price
$ 14.70 
 
 
Options, Vested and Expected to Vest, Outstanding, Number
20,356,000 
 
 
Options, Vested and Expected to Vest, Outstanding, Weighted Average Exercise Price
$ 14.62 
 
 
Options, Outstanding, Weighted Average Remaining Contractual Term
5 years 10 months 24 days 
 
 
Shares Authorized under Stock Option Plans, Exercise Price Range, Exercisable Options, Weighted Average Remaining Contractual Term
5 years 1 month 5 days 
 
 
Options, Vested and Expected to Vest, Outstanding, Weighted Average Remaining Contractual Term
5 years 9 months 17 days 
 
 
Options, Outstanding, Intrinsic Value
$ 130,923,000 1
 
 
Options, Exercisable, Intrinsic Value
91,434,000 1
 
 
Options, Vested and Expected to Vest, Outstanding, Aggregate Intrinsic Value
124,575,000 1
 
 
Entity Closing Stock Price
20.71 
 
 
Outstanding Options In Money
21,100,000 
 
 
Exercisable Options In Money
14,900,000 
 
 
Minimum number of PSUs issuable
1,300,000 
 
 
Maximum number of PSUs issuable
2,500,000 
 
 
Options, Exercises in Period, Total Intrinsic Value
61,900,000 
14,400,000 
21,100,000 
Total fair value of Options, Vested in Period
32,600,000 
34,600,000 
40,300,000 
RSUs and PSUs
 
 
 
Retricteds stock units, outstanding, Number
23,275,000 
18,852,000 
 
Restricted stock units granted (in shares)
12,912,000 2
10,757,000 
8,136,000 
Restricted stock units, Vested in Period
(7,163,000)
 
 
Restricted stock units, Forfeited in Period
(1,326,000)
 
 
Weighted Average Grant Date Fair Value, RSUs, Outstanding
$ 15.94 
$ 13.82 
 
Weighted average grant date fair value, RSUs and PSUs, granted
$ 17.68 
$ 13.46 
$ 13.86 
Restricted stock units, Vested in Period, Weighted Average Grant Date Fair Value
$ 13.78 
 
 
Restricted stock units, Forfeited in Period, Weighted Average Grant Date Fair Value
$ 14.44 
 
 
Weighted Average Grant Date Fair Value, RSUs and PSUs, Vested and expected to vest
$ 15.96 
 
 
Aggregate Intrinsic value of RSUs vested and expected to vest
$ 18,988,000 
 
 
Number of Shares Available for Grant
24,501,781 
24,700,000 
 
Net Income Per Share (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 25, 2015
Oct. 26, 2014
Jul. 27, 2014
Apr. 27, 2014
Jan. 26, 2014
Oct. 27, 2013
Jul. 28, 2013
Apr. 28, 2013
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Notes to financial statements [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Debt Instrument, Convertible, Conversion Price
$ 20.16 
 
 
 
 
 
 
 
$ 20.16 
 
 
Warrant Strike Price
 
 
 
 
 
 
 
 
$ 27.14 
 
 
Numerator:
 
 
 
 
 
 
 
 
 
 
 
Net income
$ 193,128 
$ 172,967 
$ 127,976 
$ 136,516 
$ 146,917 
$ 118,734 
$ 96,448 
$ 77,891 
$ 630,587 
$ 439,990 
$ 562,536 
Denominator:
 
 
 
 
 
 
 
 
 
 
 
Denominator for basic net income per share, weighted average shares (in shares)
 
 
 
 
 
 
 
 
552,319 
587,893 
619,324 
Effect of dilutive securities:
 
 
 
 
 
 
 
 
 
 
 
Equity awards outstanding (in shares)
 
 
 
 
 
 
 
 
10,749 
6,624 
5,633 
Denominator for diluted net income per share, weighted average shares (in shares)
 
 
 
 
 
 
 
 
563,068 
594,517 
624,957 
Net income per share:
 
 
 
 
 
 
 
 
 
 
 
Basic net income per share
$ 0.35 
$ 0.32 
$ 0.23 
$ 0.24 
$ 0.26 
$ 0.20 
$ 0.16 
$ 0.13 
$ 1.14 
$ 0.75 
$ 0.91 
Diluted net income per share
$ 0.35 
$ 0.31 
$ 0.22 
$ 0.24 
$ 0.25 
$ 0.20 
$ 0.16 
$ 0.13 
$ 1.12 
$ 0.74 
$ 0.90 
Anti-dilutive common equivalent shares from stock options and RSUs (in shares)
 
 
 
 
 
 
 
 
11,807 
25,630 
26,784 
3dfx (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Notes to financial statements [Abstract]
 
 
 
Aggregate purchase price of acquisition paid initially
$ 74,200,000 
 
 
Accrued legal settlement
0 1
30,600,000 1
 
Litigation Reserve Administrative Expenses And Trustee Fee paid
5,600,000 
 
 
Goodwill adjustment related to previously acquired business-3dfx
$ 25,000,000 
$ 0 
$ 0 
Goodwill (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Goodwill [Line Items]
 
 
 
Goodwill adjustment related to previously acquired business-3dfx
$ 25,000 
$ 0 
$ 0 
Goodwill
618,179 
643,179 
 
Portal Player [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
104,896 
104,896 
 
Icera Business Acquisition [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
271,186 
271,186 
 
3dfx [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
50,326 
75,326 
 
Mental Images [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
59,252 
59,252 
 
MediaQ [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
35,167 
35,167 
 
ULi [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
31,115 
31,115 
 
Hybrid Graphics [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
27,906 
27,906 
 
Ageia [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
19,198 
19,198 
 
Portland Group, Inc. [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
2,149 
2,149 
 
Other Goodwill [Member]
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
16,984 
16,984 
 
GPU
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
209,700 
230,400 
 
Tegra processor
 
 
 
Goodwill [Line Items]
 
 
 
Goodwill
$ 408,500 
$ 412,800 
 
Intangible Assets (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Amortizable intangible assets components [Line Items]
 
 
 
Gross Carrying Amount
$ 638,112,000 
$ 635,435,000 
 
Accumulated Amortization
(416,398,000)
(339,423,000)
 
Net Carrying Amount
221,714,000 
296,012,000 
 
Amortization expense associated with intangible assets
 
 
 
Amortization expense
77,000,000 
72,700,000 
68,400,000 
Future amortization expense associated with intangible assets
 
 
 
Fiscal 2016
71,900,000 
 
 
Fiscal 2017
63,600,000 
 
 
Fiscal 2018
49,100,000 
 
 
Fiscal 2019
20,400,000 
 
 
Fiscal 2020
11,900,000 
 
 
Future amortization after year five
4,800,000 
 
 
Acquisition-related intangible assets
 
 
 
Amortizable intangible assets components [Line Items]
 
 
 
Gross Carrying Amount
189,239,000 
189,239,000 
 
Accumulated Amortization
(134,062,000)
(114,104,000)
 
Net Carrying Amount
55,177,000 
75,135,000 
 
Finite-Lived Intangible Assets, Average Useful Life
6 years 9 months 17 days 
6 years 6 months 0 days 
 
Patents and Licensed Technology [Member]
 
 
 
Amortizable intangible assets components [Line Items]
 
 
 
Gross Carrying Amount
448,873,000 
446,196,000 
 
Accumulated Amortization
(282,336,000)
(225,319,000)
 
Net Carrying Amount
$ 166,537,000 
$ 220,877,000 
 
Finite-Lived Intangible Assets, Average Useful Life
7 years 2 months 12 days 
7 years 2 months 12 days 
 
Marketable Securities (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Classified as:
 
 
 
Cash equivalents
$ 294,710,000 
$ 572,425,000 
 
Marketable securities
4,126,685,000 
3,520,223,000 
 
Estimated Fair Value
4,421,395,000 
4,092,648,000 
 
Amortized Cost Basis
 
 
 
Less than one year
1,570,233,000 
1,883,132,000 
 
Due in 1-5 years
2,719,852,000 
2,114,289,000 
 
Mortgage-backed securities issued by government-sponsored enterprises not due to a single maturity date
122,893,000 
90,472,000 
 
Total
4,412,978,000 
4,087,893,000 
 
Estimated Fair Value
 
 
 
Less than one year
1,570,622,000 
1,883,753,000 
 
Due in 1-5 years
2,725,945,000 
2,117,387,000 
 
Mortgage-backed securities issued by government-sponsored enterprises not due to a single maturity date
124,828,000 
91,508,000 
 
Total
4,421,395,000 
4,092,648,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
1,364,217,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
35,875,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
1,400,092,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses
(2,396,000)
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses
(232,000)
 
 
Available-for-sale, Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions
9 
 
 
Available-for-sale Securities, Amortized Cost Basis
4,412,977,000 
4,087,893,000 
 
Net realized gain
100,000 
2,400,000 
500,000 
Available For Sale Securities Net Unrealized Gain Loss
8,400,000 
4,800,000 
 
Gross Unrealized Gain
11,046,000 
7,178,000 
 
Gross Unrealized Losses
(2,628,000)
(2,423,000)
 
Corporate Debt Securities
 
 
 
Classified as:
 
 
 
Estimated Fair Value
2,186,311,000 
1,763,725,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
709,392,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
10,085,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
719,477,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses
(1,199,000)
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses
(15,000)
 
 
Available-for-sale Securities, Amortized Cost Basis
2,184,925,000 
1,762,833,000 
 
Gross Unrealized Gain
2,600,000 
1,837,000 
 
Gross Unrealized Losses
(1,214,000)
(945,000)
 
US Government Agencies Debt Securities
 
 
 
Classified as:
 
 
 
Estimated Fair Value
750,320,000 
1,013,327,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
246,480,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
0 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
246,480,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses
(227,000)
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses
0 
 
 
Available-for-sale Securities, Amortized Cost Basis
749,630,000 
1,012,740,000 
 
Gross Unrealized Gain
917,000 
848,000 
 
Gross Unrealized Losses
(227,000)
(261,000)
 
US Treasury Securities
 
 
 
Classified as:
 
 
 
Estimated Fair Value
536,364,000 
496,453,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
10,026,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
0 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
10,026,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses
(3,000)
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses
0 
 
 
Available-for-sale Securities, Amortized Cost Basis
533,673,000 
495,889,000 
 
Gross Unrealized Gain
2,694,000 
621,000 
 
Gross Unrealized Losses
(3,000)
(57,000)
 
Money Market Funds
 
 
 
Classified as:
 
 
 
Estimated Fair Value
132,495,000 
307,865,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Amortized Cost Basis
132,495,000 
307,865,000 
 
Gross Unrealized Gain
0 
0 
 
Gross Unrealized Losses
0 
0 
 
Asset-backed Securities
 
 
 
Classified as:
 
 
 
Estimated Fair Value
452,884,000 
257,717,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
306,066,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
4,476,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
310,542,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses
(323,000)
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses
(6,000)
 
 
Available-for-sale Securities, Amortized Cost Basis
453,088,000 
258,017,000 
 
Gross Unrealized Gain
125,000 
15,000 
 
Gross Unrealized Losses
(329,000)
(315,000)
 
Mortgage backed securities issued by United Sates government-sponsored enterprises
 
 
 
Classified as:
 
 
 
Estimated Fair Value
278,105,000 
188,706,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
81,245,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
21,314,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
102,559,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses
(639,000)
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses
(211,000)
 
 
Available-for-sale Securities, Amortized Cost Basis
274,366,000 
185,594,000 
 
Gross Unrealized Gain
4,589,000 
3,837,000 
 
Gross Unrealized Losses
(850,000)
(725,000)
 
Foreign Government Debt
 
 
 
Classified as:
 
 
 
Estimated Fair Value
84,916,000 
64,855,000 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value
11,008,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value
0 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value
11,008,000 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Losses
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Losses
(5,000)
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Losses
0 
 
 
Available-for-sale Securities, Amortized Cost Basis
84,800,000 
64,955,000 
 
Gross Unrealized Gain
121,000 
20,000 
 
Gross Unrealized Losses
$ (5,000)
$ (120,000)
 
Fair Value of Financial Assets and Liabilities (Details) (USD $)
Jan. 25, 2015
Jan. 26, 2014
Financial assets and liabilities measured at fair value
 
 
Convertible Debt, Fair Value Disclosures
$ 1,679,600,000 
$ 1,528,400,000 
Debt Instrument, Face Amount
1,500,000,000 
1,500,000,000 
Estimated Fair Value
4,421,395,000 
4,092,648,000 
US Government Agencies Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
750,320,000 
1,013,327,000 
Cash and Cash Equivalents, Fair Value Disclosure
15,000,000 
 
Marketable Securities
735,300,000 
 
Corporate Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
2,186,311,000 
1,763,725,000 
Cash and Cash Equivalents, Fair Value Disclosure
147,200,000 
 
Marketable Securities
2,000,000,000 
 
Mortgage backed securities issued by United Sates government-sponsored enterprises
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
278,105,000 
188,706,000 
Money Market Funds
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
132,495,000 
307,865,000 
US Treasury Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
536,364,000 
496,453,000 
Asset-backed Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
452,884,000 
257,717,000 
Fair Value, Inputs, Level 1 [Member]
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
132,495,000 
 
Fair Value, Inputs, Level 1 [Member] |
US Government Agencies Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
0 
 
Fair Value, Inputs, Level 1 [Member] |
Corporate Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
0 
 
Fair Value, Inputs, Level 1 [Member] |
Mortgage backed securities issued by United Sates government-sponsored enterprises
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
0 
 
Fair Value, Inputs, Level 1 [Member] |
Money Market Funds
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
132,495,000 1
 
Fair Value, Inputs, Level 1 [Member] |
US Treasury Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
0 
 
Fair Value, Inputs, Level 1 [Member] |
Asset-backed Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
0 
 
Fair Value, Inputs, Level 1 [Member] |
Foreign Government Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
0 
 
Fair Value, Inputs, Level 2 [Member]
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
4,288,900,000 
 
Fair Value, Inputs, Level 2 [Member] |
US Government Agencies Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
750,320,000 2
 
Fair Value, Inputs, Level 2 [Member] |
Corporate Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
2,186,311,000 3
 
Fair Value, Inputs, Level 2 [Member] |
Mortgage backed securities issued by United Sates government-sponsored enterprises
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
278,105,000 4
 
Fair Value, Inputs, Level 2 [Member] |
Money Market Funds
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
0 
 
Fair Value, Inputs, Level 2 [Member] |
US Treasury Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
536,364,000 4
 
Fair Value, Inputs, Level 2 [Member] |
Asset-backed Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
452,884,000 4
 
Fair Value, Inputs, Level 2 [Member] |
Foreign Government Debt Securities
 
 
Financial assets and liabilities measured at fair value
 
 
Estimated Fair Value
$ 84,916,000 4
 
Balance Sheet Components (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Inventories
 
 
 
Raw Materials
$ 156,846,000 
$ 126,896,000 
 
Work in-process
91,778,000 
94,844,000 
 
Finished goods
234,269,000 
166,025,000 
 
Total inventories
482,893,000 
387,765,000 
 
Property, Plant and Equipment [Line Items]
 
 
 
Depreciation
143,100,000 
164,000,000 
157,600,000 
Accumulated amortization of LHI and capital lease
139,600,000 
146,400,000 
 
Property, Plant and Equipment, Gross
1,179,257,000 
1,282,820,000 
 
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment
(621,975,000)
(700,080,000)
 
Property, Plant and Equipment, Net
557,282,000 
582,740,000 
 
Accrued Liabilities
 
 
 
Deferred revenue
292,735,000 
268,808,000 
 
Customer related liabilities
146,724,000 1
163,945,000 1
 
Accrued payroll and related expenses
112,173,000 
109,721,000 
 
Professional service fees
17,025,000 2
13,572,000 2
 
Facilities related liabilities
7,603,000 
5,216,000 
 
Warranty accrual
7,523,000 
7,571,000 
 
Taxes payable, short term
2,810,000 
2,378,000 
 
Interest Payable, Current
2,542,000 
2,500,000 
 
Accrued legal settlement
0 3
30,600,000 3
 
Other
13,672,000 
16,794,000 
 
Accrued liabilities and other current liabilities
602,807,000 
621,105,000 
 
Other Long-term Liabilities
 
 
 
Deferred income tax liability
232,307,000 
157,953,000 
 
Income taxes payable, long term
120,961,000 
119,977,000 
 
Deferred Revenue
107,838,000 
172,199,000 
 
Asset retirement obligation
7,428,000 
11,056,000 
 
Liabilites other noncurrent
20,394,000 
13,940,000 
 
Total other long-term liabilities
488,928,000 
475,125,000 
 
Land [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
(A) 
 
 
Property, Plant and Equipment, Gross
218,496,000 4
218,496,000 4
 
Building [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
5-25 
 
 
Property, Plant and Equipment, Gross
19,268,000 
19,268,000 
 
Machinery and Equipment [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
3-5 
 
 
Property, Plant and Equipment, Gross
397,319,000 
412,862,000 
 
Computer Software, Intangible Asset [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
3-5 
 
 
Property, Plant and Equipment, Gross
112,967,000 
120,435,000 
 
Leasehold Improvements [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
(B) 
 
 
Property, Plant and Equipment, Gross
173,691,000 5
178,884,000 5
 
Computer Equipment [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
3 
 
 
Property, Plant and Equipment, Gross
152,733,000 
204,344,000 
 
Furniture and Fixtures [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
5 
 
 
Property, Plant and Equipment, Gross
48,692,000 
58,874,000 
 
Capital Lease Obligations [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
(B) 
 
 
Property, Plant and Equipment, Gross
28,481,000 5
28,481,000 5
 
Construction in Progress [Member]
 
 
 
Property, Plant and Equipment [Line Items]
 
 
 
Property, Plant and Equipment, Estimated Useful Lives
(C) 
 
 
Property, Plant and Equipment, Gross
$ 27,610,000 6
$ 41,176,000 6
 
Guarantees (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Jan. 30, 2011
Notes to financial statements [Abstract]
 
 
 
 
Cumulative Net Warranty charge
$ 475,900,000 
 
 
 
Release of warranty accrual
7,800,000 
 
 
 
Estimated product warranty liabilities
 
 
 
 
Balance at beginning of period
7,571,000 1
14,874,000 1
 
18,406,000 1
Additions
5,441,000 
6,786,000 
5,738,000 
 
Deductions
(5,489,000)2
(14,089,000)2
(9,270,000)2
 
Balance at end of period
7,523,000 
7,571,000 1
14,874,000 1
18,406,000 1
Remaining amount of the warranty accrual associated with incremental repair and replacement costs from a weak die/packaging material set
 
9,600,000 
13,200,000 
 
Payments related to warranty accrual
 
$ 1,800,000 
$ 3,000,000 
 
Long-term debt (Details) (USD $)
Share data in Millions, except Per Share data, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Debt Instrument [Line Items]
 
 
 
Debt Instrument, Face Amount
$ 1,500,000,000 
$ 1,500,000,000 
 
Debt Instrument, Interest Rate, Stated Percentage
1.00% 
 
 
Debt Instrument, Convertible, Conversion Ratio
49.60 
 
 
Debt Instrument, Convertible, Conversion Price
$ 20.16 
 
 
Debt Instrument, Convertible, Terms of Conversion Feature
(1) during any fiscal quarter commencing after the fiscal quarter ended on April 27, 2014 (and only during such fiscal quarter), if the last reported sale price of the common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the measurement period) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after August 1, 2018 to the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes regardless of the foregoing conditions. Upon conversion, we will pay cash up to the aggregate principal amount of the notes to be converted and pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, in respect of the remainder, if any, of our conversion obligation in excess of the aggregate principal amount of the notes being converted. 
 
 
Debt Instrument, Convertible, Initial Liability Amount
1,351,800,000 
 
 
Debt Instrument, Convertible, Effective Interest Rate
3.15% 
 
 
Discount on convertible notes
125,725,000 
125,725,000 
 
Purchaser's Discount of Convertible Notes
22,500,000 
 
 
Initial unamortized debt discount at issuance
148,200,000 
 
 
Debt Instrument, Unamortized Discount
(115,658,000)
(143,625,000)
 
Long-term Debt
1,384,342,000 
1,356,375,000 
 
Debt Instrument, Convertible, Remaining Discount Amortization Period
3 years 10 months 24 days 
 
 
Coupon Interest Expense
15,000,000 
2,500,000 
 
Amortization of debt discount
27,967,000 
4,600,000 
0 
Amortization of Financing Costs
195,000 
34,000 
 
Debt Instrument, Convertible, Interest Expense
43,162,000 
7,134,000 
 
Proceeds from issuance of convertible notes, net
0 
1,477,500,000 
0 
Note Hedges Strike Price
$ 20.16 
 
 
Purchase of convertible note hedges
0 
167,100,000 
0 
Warrant Strike Price
 
$ 27.14 
 
Number of Shares Covered by Warrants
74.4 
 
 
Proceeds from the sale of common stock warrants
0 
59,100,000 
0 
Net Cost of Hedges and Warrants Transactions
 
$ 108,000,000 
 
Commitments and Contingencies (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Commitments and Contingencies Disclosure [Abstract]
 
 
 
Outstanding Inventory Purchase Obligation
$ 456,000,000 
 
 
Outstanding Capital Purchase Obligations
51,000,000 
 
 
Operating Leases, Future Minimum Payments Due [Abstract]
 
 
 
Future minimum operating lease payments - HQ
73,100,000 
 
 
Operating Leases, Future Minimum Payments Due, Current
76,741,000 
 
 
Operating Leases, Future Minimum Payments, Due in Two Years
66,242,000 
 
 
Operating Leases, Future Minimum Payments, Due in Three Years
34,070,000 
 
 
Operating Leases, Future Minimum Payments, Due in Four Years
26,793,000 
 
 
Operating Leases, Future Minimum Payments, Due in Five Years
9,988,000 
 
 
Operating Leases, Future Minimum Payments, Due Thereafter
27,477,000 
 
 
Operating Leases, Future Minimum Payments Due
241,311,000 
 
 
Operating Leases, Rent Expense
47,300,000 
43,800,000 
38,400,000 
Capital Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
 
 
 
Future minimum capital lease payments - HQ
20,900,000 
 
 
Capital Leases, Future Minimum Payments Due, Current
5,303,000 
 
 
Capital Leases, Future Minimum Payments Due in Two Years
5,453,000 
 
 
Capital Leases, Future Minimum Payments Due in Three Years
5,607,000 
 
 
Capital Leases, Future Minimum Payments Due in Four Years
5,767,000 
 
 
Capital Leases, Future Minimum Payments Due in Five Years
26,000 
 
 
Capital Leases, Future Minimum Payments Due Thereafter
0 
 
 
Capital Leases, Future Minimum Payments Due
22,156,000 
 
 
Capital Leases, Future Minimum Payments, Present Value of Net Minimum Payments
17,500,000 
 
 
Capital Lease Obligations, Current
3,414,000 
 
 
Capital Lease Obligations, Noncurrent
14,086,000 
17,500,000 
 
Loss Contingency [Abstract]
 
 
 
Aggregate purchase price of acquisition paid initially, net of direct costs
70,000,000 
 
 
Excess of assessed fair value over acquisition price paid
$ 50,000,000 
 
 
Income Taxes (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Current Income Tax Expense
 
 
 
Federal
$ 7,995,000 
$ 7,896,000 
$ 7,506,000 
State
818,000 
1,234,000 
1,016,000 
Foreign
17,356,000 
18,513,000 
16,766,000 
Total current
26,169,000 
27,643,000 
25,288,000 
Deferred Income Tax Expense (Benefit), Continuing Operations [Abstract]
 
 
 
Federal
83,827,000 
17,070,000 
28,143,000 
State
0 
0 
0 
Foreign
(1,258,000)
(1,640,000)
3,717,000 
Total deferred
82,569,000 
15,430,000 
31,860,000 
Charge in lieu of taxes attributable to employer stock option plans
15,511,000 
27,191,000 
42,355,000 
Income tax expense
124,249,000 
70,264,000 
99,503,000 
Income before Income Taxes
 
 
 
Domestic
173,865,000 
79,136,000 
99,422,000 
Foreign
580,971,000 
431,118,000 
562,617,000 
Income before income tax
754,836,000 
510,254,000 
662,039,000 
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate
35.00% 
 
 
Income Tax Expense (Benefit), Continuing Operations, Income Tax Reconciliation [Abstract]
 
 
 
Tax expense computed at federal statutory rate
264,192,000 
178,589,000 
231,714,000 
State income taxes, net of federal tax effect
681,000 
1,608,000 
1,048,000 
Foreign tax rate differential
(119,786,000)
(93,831,000)
(123,626,000)
U.S. federal R&D tax credit
(34,319,000)
(30,155,000)
(29,294,000)
Stock-based compensation
4,332,000 
8,900,000 
11,876,000 
Tax expense related to inter-company transaction
9,785,000 
9,785,000 
9,785,000 
Other
(636,000)
(4,632,000)
(2,000,000)
Income tax expense
124,249,000 
70,264,000 
99,503,000 
Components of Deferred Tax Assets [Abstract]
 
 
 
Net operating loss carryforwards
72,322,000 
81,629,000 
 
Accruals and reserves, not currently deductible for tax purposes
109,123,000 
131,932,000 
 
Property, equipment and intangible assets
45,593,000 
48,358,000 
 
Research and other tax credit carryforwards
350,655,000 
306,975,000 
 
Stock-based compensation
29,850,000 
33,135,000 
 
Convertible debt - DTA
12,327,000 
14,885,000 
 
Gross deferred tax assets
619,870,000 
616,914,000 
 
Less valuation allowance
(260,985,000)
(244,487,000)
 
Deferred Tax Assets, Net
358,885,000 
372,427,000 
 
Components of Deferred Tax Liabilities [Abstract]
 
 
 
Deferred Tax Liabilities Intangible Assets
(24,463,000)
(33,244,000)
 
Unremitted earnings of foreign subsidiaries
(500,031,000)
(425,401,000)
 
Deferred Tax Liabilities, Gross
(524,494,000)
(458,645,000)
 
Net deferred tax asset (liability)
(165,609,000)
(86,218,000)
 
Effective tax rate
16.50% 
13.80% 
15.00% 
Operating Loss Carryforwards [Line Items]
 
 
 
Excess Tax Benefit Related To Stock Based Compensation
411,900,000 
 
 
Operating Loss Carryforwards
521,500,000 
667,200,000 
332,600,000 
Deferred Tax Assets, Operating Loss Carryforwards, Foreign
316,700,000 
 
 
Foreign net operating loss carryforwards remainder
15,900,000 
 
 
Undistributed Earnings Of Non United States Subsidiaries
2,270,000,000 
 
 
UNITED STATES
 
 
 
Operating Loss Carryforwards [Line Items]
 
 
 
Deferred Tax Assets, Tax Credit Carryforwards, Research
429,600,000 
 
 
State and Local Jurisdiction
 
 
 
Operating Loss Carryforwards [Line Items]
 
 
 
Deferred Tax Assets, Tax Credit Carryforwards, Other
3,000,000 
 
 
Deferred Tax Assets, Tax Credit Carryforwards, Research
411,700,000 
 
 
CALIFORNIA
 
 
 
Operating Loss Carryforwards [Line Items]
 
 
 
Deferred Tax Assets, Tax Credit Carryforwards, Research
395,900,000 
 
 
Other states
 
 
 
Operating Loss Carryforwards [Line Items]
 
 
 
Deferred Tax Assets, Tax Credit Carryforwards, Research
15,800,000 
 
 
Foreign Country
 
 
 
Operating Loss Carryforwards [Line Items]
 
 
 
Deferred Tax Assets, Tax Credit Carryforwards, Other
$ 18,400,000 
 
 
Income Taxes Income Taxes (Unrecognized Tax Benefits) (Details) (USD $)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Jan. 30, 2011
Income Tax Contingency [Line Items]
 
 
 
 
Unrecognized Tax Benefits that Would Impact Effective Tax Rate
$ 228,700,000 
 
 
 
Reduction of deferred tax asset included in unrecognized tax benefit
122,100,000 
 
 
 
Income Tax Reconciliation, Tax Contingencies [Abstract]
 
 
 
 
Balance at beginning of period
237,738,000 
220,543,000 
 
138,262,000 
Increases in tax positions for prior years
0 
0 
18,800,000 
 
Decreases in tax positions for prior years
(871,000)
(714,000)
(304,000)
 
Increases in tax positions for current year
22,865,000 
22,787,000 
67,764,000 
 
Lapse in statute of limitations
(5,997,000)
(4,878,000)
(3,979,000)
 
Balance at end of period
253,735,000 
237,738,000 
220,543,000 
138,262,000 
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued [Abstract]
 
 
 
 
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued
14,400,000 
12,900,000 
11,300,000 
 
Accrued Income Taxes, Noncurrent
120,961,000 
119,977,000 
 
 
Unrecognized tax benefit (non current)
106,600,000 
 
 
 
State and Local Jurisdiction
 
 
 
 
Income Tax Reconciliation, Tax Contingencies [Abstract]
 
 
 
 
Balance at end of period
$ 45,300,000 
 
 
 
Stockholders' Equity (Details) (USD $)
Share data in Millions, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 25, 2015
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Notes to financial statements [Abstract]
 
 
 
 
Stock repurchase program, additional authorized amount
 
 
$ 1,000,000,000 
 
Stock Repurchase Program, Authorized Amount
3,700,000,000 
3,700,000,000 
 
 
Stock Repurchased During Period, Shares
 
44.4 
 
 
Stock Repurchased During Period, Value
 
813,600,000 
 
 
Dividends paid
 
186,452,000 
181,336,000 
46,866,000 
Dividends
0.085 
0.34 
 
 
Return to shareholders in the current year
 
1,000,000,000 
 
 
Aggregate number of shares repurchased under stock repurchase program
 
205.6 
 
 
Aggregated cost of shares repurchased
3,265,200,000 
3,265,200,000 
 
 
Stock Repurchase Program, Remaining Authorized Repurchase Amount
434,800,000 
434,800,000 
 
 
Intended return to shareholder in FY2016
 
600,000,000 
 
 
Tax withholding related to vesting of restricted stock units, value
 
$ (43,684,000)
$ (27,282,000)
$ (25,805,000)
Employee Retirement Plans (Details) (USD $)
In Millions, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Employee Retirement Plans [Abstract]
 
 
 
Employee Retirement Plans Maximum Contribution Percentage Of Earnings
100.00% 
 
 
401K Plan employer contribution expense in US
$ 5.8 
$ 5.1 
 
Defined Contribution Plan, Cost Recognized, outside US
$ 19.7 
$ 16.2 
$ 16.7 
Segment Information (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 25, 2015
Oct. 26, 2014
Jul. 27, 2014
Apr. 27, 2014
Jan. 26, 2014
Oct. 27, 2013
Jul. 28, 2013
Apr. 28, 2013
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Segment Reporting
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 1,250,514 
$ 1,225,382 
$ 1,102,824 
$ 1,102,787 
$ 1,144,218 
$ 1,053,967 
$ 977,238 
$ 954,739 
$ 4,681,507 
$ 4,130,162 
$ 4,280,159 
Depreciation and amortization expense
 
 
 
 
 
 
 
 
220,125 
239,148 
226,235 
Operating income (loss)
 
 
 
 
 
 
 
 
758,989 
496,227 
648,239 
Reconciliation from Segment Totals to Consolidated
 
 
 
 
 
 
 
 
 
 
 
Unallocated corporate expenses and other expenses
 
 
 
 
 
 
 
 
(168,730)
(166,483)
(157,680)
Stock-based compensation
 
 
 
 
 
 
 
 
(157,841)
(136,295)
(136,662)
Other acquisition-related costs
 
 
 
 
 
 
 
 
(37,355)
(31,652)
(36,138)
Other Nonrecurring Expense and Benefits
 
 
 
 
 
 
 
 
0 
(38)
(20,127)
Reconciliation total in All other
 
 
 
 
 
 
 
 
(99,926)
(70,468)
(86,607)
GPU
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
3,838,906 
3,468,144 
3,251,712 
Depreciation and amortization expense
 
 
 
 
 
 
 
 
116,683 
146,571 
143,262 
Operating income (loss)
 
 
 
 
 
 
 
 
1,113,350 
834,763 
694,338 
Tegra processor
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
578,601 
398,018 
764,447 
Depreciation and amortization expense
 
 
 
 
 
 
 
 
57,282 
49,839 
40,793 
Operating income (loss)
 
 
 
 
 
 
 
 
(254,435)
(268,068)
40,508 
All Other
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
264,000 
264,000 
264,000 
Depreciation and amortization expense
 
 
 
 
 
 
 
 
46,160 
42,738 
42,180 
Operating income (loss)
 
 
 
 
 
 
 
 
(99,926)
(70,468)
(86,607)
Corporate [Member]
 
 
 
 
 
 
 
 
 
 
 
Segment Reporting
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
4,681,507 
4,130,162 
4,280,159 
Depreciation and amortization expense
 
 
 
 
 
 
 
 
220,125 
239,148 
226,235 
Operating income (loss)
 
 
 
 
 
 
 
 
$ 758,989 
$ 496,227 
$ 648,239 
Segment Information Revenue and Long-lived assets by region (Details) (USD $)
In Thousands, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 25, 2015
Oct. 26, 2014
Jul. 27, 2014
Apr. 27, 2014
Jan. 26, 2014
Oct. 27, 2013
Jul. 28, 2013
Apr. 28, 2013
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 1,250,514 
$ 1,225,382 
$ 1,102,824 
$ 1,102,787 
$ 1,144,218 
$ 1,053,967 
$ 977,238 
$ 954,739 
$ 4,681,507 
$ 4,130,162 
$ 4,280,159 
Long-Lived Assets
648,178 
 
 
 
686,992 
 
 
 
648,178 
686,992 
 
CHINA
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
922,121 
793,790 
780,493 
Long-Lived Assets
28,073 
 
 
 
29,313 
 
 
 
28,073 
29,313 
 
TAIWAN
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
1,594,435 
1,321,503 
1,356,838 
Long-Lived Assets
52,176 
 
 
 
51,993 
 
 
 
52,176 
51,993 
 
Other Asia Pacific
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
637,029 
675,339 
783,573 
Long-Lived Assets
587 
 
 
 
1,092 
 
 
 
587 
1,092 
 
Europe
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
368,921 
295,160 
263,488 
Long-Lived Assets
51,521 
 
 
 
50,677 
 
 
 
51,521 
50,677 
 
UNITED STATES
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
790,614 
726,830 
799,430 
Long-Lived Assets
467,277 
 
 
 
522,461 
 
 
 
467,277 
522,461 
 
Other Americas
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Revenue
 
 
 
 
 
 
 
 
368,387 
317,540 
296,337 
INDIA
 
 
 
 
 
 
 
 
 
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
 
 
 
 
 
 
 
 
 
Long-Lived Assets
$ 48,544 
 
 
 
$ 31,456 
 
 
 
$ 48,544 
$ 31,456 
 
Segment Information Revenue and Accounts Receivable by major customer (Details)
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Customer A (REV)
 
 
 
Revenue, Major Customer [Line Items]
 
 
 
Revenue from significant customers (in percent)
11.00% 
11.00% 
13.00% 
Customer B (REV)
 
 
 
Revenue, Major Customer [Line Items]
 
 
 
Revenue from significant customers (in percent)
9.00% 
10.00% 
9.00% 
Segment Information Schedule of Accounts Receivable by Major Customers (Details)
Jan. 25, 2015
Jan. 26, 2014
Accounts Receivable by Major Customers
 
 
Accounts receivable from significant customers (in percent)
30.00% 
23.00% 
Customer B (AR)
 
 
Accounts Receivable by Major Customers
 
 
Accounts receivable from significant customers (in percent)
20.00% 
23.00% 
Customer C (AR)
 
 
Accounts Receivable by Major Customers
 
 
Accounts receivable from significant customers (in percent)
10.00% 
9.00% 
Quartely Summary (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended 12 Months Ended
Jan. 25, 2015
Oct. 26, 2014
Jul. 27, 2014
Apr. 27, 2014
Jan. 26, 2014
Oct. 27, 2013
Jul. 28, 2013
Apr. 28, 2013
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Selected Quarterly Financial Information [Abstract]
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 1,250,514 
$ 1,225,382 
$ 1,102,824 
$ 1,102,787 
$ 1,144,218 
$ 1,053,967 
$ 977,238 
$ 954,739 
$ 4,681,507 
$ 4,130,162 
$ 4,280,159 
Cost of revenue
550,911 
548,684 
483,850 
498,585 
524,976 
469,552 
431,700 
436,171 
2,082,030 
1,862,399 
2,053,816 
Gross profit
699,603 
676,698 
618,974 
604,202 
619,242 
584,415 
545,538 
518,568 
2,599,477 
2,267,763 
2,226,343 
Net income
$ 193,128 
$ 172,967 
$ 127,976 
$ 136,516 
$ 146,917 
$ 118,734 
$ 96,448 
$ 77,891 
$ 630,587 
$ 439,990 
$ 562,536 
Basic net income per share
$ 0.35 
$ 0.32 
$ 0.23 
$ 0.24 
$ 0.26 
$ 0.20 
$ 0.16 
$ 0.13 
$ 1.14 
$ 0.75 
$ 0.91 
Diluted net income per share
$ 0.35 
$ 0.31 
$ 0.22 
$ 0.24 
$ 0.25 
$ 0.20 
$ 0.16 
$ 0.13 
$ 1.12 
$ 0.74 
$ 0.90 
Schedule II (Details) (USD $)
In Thousands, unless otherwise specified
12 Months Ended
Jan. 25, 2015
Jan. 26, 2014
Jan. 27, 2013
Allowance for Trade Receivables [Member]
 
 
 
Valuation and Qualifying Accounts Disclosure [Line Items]
 
 
 
Valuation Allowances and Reserves, Balance
$ 848 
$ 1,804 
$ 973 
Valuation Allowances and Reserves, Charged to Cost and Expense
2,837 1
309 1
1,139 1
Valuation Allowances and Reserves, Deductions
(793)1
(1,265)1
(308)1
Valuation Allowances and Reserves, Balance
2,892 
848 
1,804 
Allowance for Sales Returns [Member]
 
 
 
Valuation and Qualifying Accounts Disclosure [Line Items]
 
 
 
Valuation Allowances and Reserves, Balance
14,111 
14,790 
13,881 
Valuation Allowances and Reserves, Charged to Cost and Expense
12,427 2
15,881 2
16,533 2
Valuation Allowances and Reserves, Deductions
(12,447)3
(16,560)3
(15,624)3
Valuation Allowances and Reserves, Balance
14,091 
14,111 
14,790 
Valuation Allowance of Deferred Tax Assets [Member]
 
 
 
Valuation and Qualifying Accounts Disclosure [Line Items]
 
 
 
Valuation Allowances and Reserves, Balance
244,487 
224,774 
212,285 
Valuation Allowances and Reserves, Charged to Cost and Expense
16,498 4
19,713 4
12,489 4
Valuation Allowances and Reserves, Deductions
0 
0 
0 
Valuation Allowances and Reserves, Balance
$ 260,985 
$ 244,487 
$ 224,774