In connection with the spin-off of the enterprise services business, Everett SpinCo, Inc, for the six months ended April 30, 2018, this amount includes a $239 million benefit primarily from foreign tax credits and from the release of non U.S. valuation allowances on deferred taxes established in connection with the Everett Transaction, following changes in foreign tax laws. For the six months ended April 30, 2017, this amount primarily includes $593 million of income tax expense from valuation allowances on certain U.S. deferred tax assets and other divestiture related taxes.
In connection with the settlement of certain pre-separation Hewlett-Packard Company income tax liabilities indemnified through the Tax Matters Agreement with HP Inc, for the six months ended April 30, 2018, this amount primarily includes a $2.0 billion benefit.
As a result of the recently enacted U.S. tax reform, for the six months ended April 30, 2018, this amount includes an estimated tax benefit of $1.8 billion from the provisional application of the new tax rules including a lower federal tax rate to deferred tax assets and liabilities, partially offset by a provisional estimate of $1.1 billion of transition tax expense on accumulated non U.S. earnings, and a $203 million benefit as a result of the liquidation of an insolvent non U.S. subsidiary.
During the first quarter of fiscal 2018, the Company adopted ASU 2016-09 on a prospective basis, except for the statement of cash flows for which it was retrospectively adopted for the prior comparative periods, which requires the excess tax benefits or tax deficiencies associated with stock-based compensation to be recognized as a component of the provision for income taxes in the Statement of Earnings rather than additional paid-in capital in the Balance Sheet. For the six months ended April 30, 2018, this amount includes $42 million, which represents the net excess tax benefits from stock-based compensation.
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HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In millions, except par value) | |||||||
| As of | |||||||
| April 30, 2018 | October 31, 2017 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 6,986 | $ | 9,579 | |||
| Accounts receivable, net of allowance for doubtful accounts | 3,099 | 3,073 | |||||
| Financing receivables | 3,503 | 3,378 | |||||
| Inventory | 2,848 | 2,315 | |||||
| Assets held for sale(a) | 31 | 14 | |||||
| Other current assets | 3,325 | 3,085 | |||||
| Total current assets | 19,792 | 21,444 | |||||
| Property, plant and equipment | 6,208 | 6,269 | |||||
| Long-term financing receivables and other assets | 12,915 | 12,600 | |||||
| Investments in equity interests | 2,517 | 2,535 | |||||
| Goodwill and intangible assets | 18,444 | 18,558 | |||||
| Total assets | $ | 59,876 | $ | 61,406 | |||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
| Current liabilities: | |||||||
| Notes payable and short-term borrowings | $ | 3,855 | $ | 3,850 | |||
| Accounts payable | 6,242 | 6,072 | |||||
| Employee compensation and benefits | 1,191 | 1,156 | |||||
| Taxes on earnings | 437 | 429 | |||||
| Deferred revenue | 3,163 | 3,128 | |||||
| Accrued restructuring | 286 | 445 | |||||
| Other accrued liabilities | 3,910 | 3,844 | |||||
| Total current liabilities | 19,084 | 18,924 | |||||
| Long-term debt | 9,970 | 10,182 | |||||
| Other non-current liabilities | 6,856 | 8,795 | |||||
| Stockholders’ equity | |||||||
| HPE stockholders’ equity: | |||||||
| Preferred stock, $0.01 par value (300 shares authorized; none issued and outstanding at April 30, 2018) | — | — | |||||
| Common stock, $0.01 par value (9,600 shares authorized; 1,527 and 1,595 shares issued and outstanding at April 30, 2018 and October 31, 2017, respectively) | 15 | 16 | |||||
| Additional paid-in capital | 32,205 | 33,583 | |||||
| Accumulated deficit | (5,306 | ) | (7,238 | ) | |||
| Accumulated other comprehensive loss | (2,982 | ) | (2,895 | ) | |||
| Total HPE stockholders’ equity | 23,932 | 23,466 | |||||
| Non-controlling interests | 34 | 39 | |||||
| Total stockholders’ equity | 23,966 | 23,505 | |||||
| Total liabilities and stockholders’ equity | $ | 59,876 | $ | 61,406 | |||
- In connection with the HPE Next initiative, the Company determined that certain properties within its real estate portfolio met the criteria to be classified as Assets held for sale. The Company expects these properties to be sold within the next twelve months.
