CONSOLIDATED STATEMENTS OF INCOME Dec 31, Years Ended Dec 29, Dec 30, (In Millions, Except Per Share Amounts) 2018 2017 2016 70,848 Net revenue 62,761 $ 59,387 23,663 Cost of sales 27,111 23,154 Gross margin 43,737 39,098 36,233 Research and development 13,543 13,035 12,685 Marketing, general and administrative 6,750 7,452 8,377 1,744 Restructuring and other charges (72) 384 Amortization of acquisition-related intangibles 200 177 294 20,421 Operating expenses 21,048 23,100 Operating income 23,316 18,050 13,133 Gains (losses) on equity investments, net (125) 506 2,651 Interest and other, net 126 (349) (703) 23,317 Income before taxes 20,352 12,936 Provision for taxes 2,264 10,751 2,620 9,601 $ 21,053 $ $ 10,316 Net income $ $ 2.18 4.57 2.04 Earnings per share - Basic $ 4.48 1.99 2.12 Earnings per share Diluted Weighted average shares of common stock outstanding: 4,611 4,701 4,730 Basic 4,835 4,701 4,875 Diluted See accompanying notes CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Dec 30, Dec 31, Dec 29, 2018 Years Ended (In Millions) 2017 2016 21,053 Net income 9,601 10,316 Changes in other comprehensive income, net of tax: Net unrealized holding gains (losses) on available-for-sale equity investments (434) 415 Net unrealized holding gains (losses) on derivatives (253) 365 7 317 Actuarial valuation and other pension benefits (expenses), net 210 (364) Translation adjustments and other (3) 508 (12) 756 Other comprehensive income (loss) (46) 46 $ $ 21,007 10,357 $ 10,362 Total comprehensive income See accompanying notes. CONSOLIDATED BALANCE SHEETS Dec 29, 2018 Dec 30, (In Millions, Except Par Value 2017 Assets Current assets: Cash and cash equivalents 3,433 3,019$ Short-term investments 2,788 1,814 Trading assets 5,843 8,755 Accounts receivable, net of allowance for doubtful accounts of $33 ($25 in 2017) 5,607 6,722 Inventories 6,983 7,253 Other current assets 3,162 2,908 Total current assets 28,787 29,500 Property, plant and equipment, net 48,976 41,109 6,042 8,579 Equity investments Other long-term investments 3,388 3,712 Goodwill 24,513 24,389 Identified intangible assets, net 11,836 12,745 Other long-term assets 4,421 3,215 127,963 $ 123,249 Total assets Liabilities, temporary equity, and stockholders' equity Current liabilities: 1,776 Short-term debt 1,261 $ Accounts payable 3,824 2,928 Accrued compensation and benefits 3,622 3,526 Deferred income 1,656 7,535 Other accrued liabilities 7,919 Total current liabilities 16,626 17,421 Debt 25,098 25,037 Contract liabilities 2,049 4,069 4,897 Income taxes payable, non-current 1,665 Deferred income taxes 3,046 3,791 Other long-term liabilities 2,646 Commitments and Contingencies (Note 21) 419 Temporary equity 866 Stockholders' equity: Preferred stock, $0.001 par value, 50 shares authorized; none issued Common stock, $0.001 par value, 10,000 shares authorized; 4,516 shares issued and outstanding (4,687 issued and outstanding in 2017) and capital in excess of par value 26,074 25,365 (974) Accumulated other comprehensive income (loss) 862 Retained earnings 50,172 42,083 Total stockholders' equity 74,563 69,019 127,963 123,249 Total liabilities, temporary equity, and stockholders' equity CONSOLIDATED STATEMENTS OF CASH FLOWS Dec 29, Dec 30, Dec 31, Years Ended (In Millions) Cash and cash equivalents, beginning of period Cash flows provided by (used for) operating activities 2018 2017 2016 15,308 3,433 5,560 $ Net income 21,053 9,601 10,316 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 7,520 6,752 6,266 Share-based compensation 1,358 1,546 1,444 Amortization of intangibles 1,565 1,377 1,524 (432) (Gains) losses on equity investments, net 155 (2,583) Loss on debt conversion and extinguishment 260 476 (Gains) losses on divestitures (497) (387) Deferred taxes (1,749) 1,548 257 Changes in assets and liabilities: (781) Accounts receivable (1,714) 65 Inventories (214) (1,300) 119 Accounts payable 211 191 182 Accrued compensation and benefits (260) 311 291 Customer deposits and prepaid supply agreements 1,367 1,105 _ Income taxes payable and receivable 148 5,230 1,382 (788) Other assets and liabilities 41 394 Total adjustments 8,379 12,509 11,492 29,432 Net cash provided by operating activities 22,110 21,808 Cash flows provided by (used for) investing activities: Additions to property, plant and equipment (15,181) (11,778) (9,625) (15,470) (9,269) (14,499) (190) Acquisitions, net of cash acquired Purchases of available-for-sale debt investments (3,843) (2,746) 2,847 Sales of available-for-sale debt investments 195 1,833 Maturities of available-for-sale debt investments 3,687 2,968 5,654 Purchases of trading assets (9,503) (13,700) (12,237) Maturities and sales of trading assets 12,111 13,970 10,898 (1,619) Purchases of equity investments (874) (963) 1,080 2,802 Sales of equity investments 5,236 Proceeds from divestitures 548 3,124 Other investing (272) 730 1,268 (11,239) (15,762) (25,817) Net cash used for investing activities Cash flows provided by (used for) financing activities (15) Increase (decrease) in short-term debt, net 460 12 Issuance of long-term debt, net of issuance costs 423 7,716 2,734 (1,500) Repayment of debt and debt conversion (3,026) (8,080) Proceeds from sales of common stock through employee equity incentive plans 555 770 1,108 (2,587) (4,925) Repurchase of common stock (10,730) (3,615) (5,072) Payment of dividends to stockholders (5,541) Other financing (554) (748) (206) Net cash provided by (used for) financing activities (18,607) (8,475) (5,739) Net increase (decrease) in cash and cash equivalents (414) (2,127) (9,748) 3,433 5,560 $ 3,019 $ $ Cash and cash equivalents, end of period Supplemental disclosures: Acquisition of property, plant and equipment included in accounts payable and accrued liabilities $ 2,340 1,417 979 Non-marketable equity investment in McAfee from divestiture $ $ 1,078 Cash paid during the year for: Interest, net of capitalized interest $ $ 448 624 682 $ Income taxes, net of refunds $ $ 3,824 3,813 877 See accompanying notes. a. Using the statement of cash flows, determine the amount of property, plant and equipment acquired during 2016, 2017, and 2018 b. Compare the depreciation expense for each year to the PP&E acquisitions (capital expenditures) for the same period. What does the comparison indicate