##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 
 FORM
10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended July 2, 2010
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from N/A to N/A
 Commission file number 0-1424
 ADC Telecommunications, Inc.
  Minnesota
    
    41-0743912(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 13625 Technology Drive, Eden Prairie, MN 55344-2252
 (952) 938-8080
 N/A
  þ o
  o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
  o þ




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##### Table of Contents



INTRODUCTORY NOTE
 www.sec.gov
 2




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##### 



TABLE OF CONTENTS
 PART I. FINANCIAL INFORMATIONITEM 1. FINANCIAL STATEMENTS
    
    
    4ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
    
    
    24ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    36ITEM 4. CONTROLS AND PROCEDURES
    
    
    37PART II. OTHER INFORMATION
    
    
    37ITEM 1. LEGAL PROCEEDINGS
    
    
    37ITEM 1A. RISK FACTORS
    
    
    38ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
    
    
    38ITEM 3. DEFAULTS UPON SENIOR SECURITIES
    
    
    38ITEM 4. (REMOVED AND RESERVED)
    
    
    38ITEM 5. OTHER INFORMATION
    
    
    38ITEM 6. EXHIBITS
    
    
    38SIGNATURES
    
    
    39EXHIBIT INDEX
    
    
    40EX-31.1EX-31.2EX-32
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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS
 ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETSUNAUDITED
 July 2,
    
    
    September 30,2010
    
    
    2009(In millions)ASSETSCurrent Assets:Cash and cash equivalents
    
    $
    449.2
    
    
    $
    535.5Available-for-sale securities
    
    
    181.0
    
    
    
    Accounts receivable, net of reserves of $11.0 and $9.8
    
    
    192.6
    
    
    
    180.1Unbilled revenue
    
    
    31.3
    
    
    
    17.5Inventories, net of reserves of $36.1 and $41.8
    
    
    116.3
    
    
    
    124.6Prepaid and other current assets
    
    
    36.6
    
    
    
    33.3Assets of discontinued operations
    
    
    
    
    
    
    9.8Total current assets
    
    
    1,007.0
    
    
    
    900.8Property and equipment, net of accumulated depreciation of $398.5 and $410.1
    
    
    147.9
    
    
    
    162.8Restricted cash
    
    
    8.1
    
    
    
    25.0Goodwill
    
    
    6.0
    
    
    
    0.2Intangibles, net of accumulated amortization of $164.4 and $144.4
    
    
    79.4
    
    
    
    93.3Long-term available-for-sale securities
    
    
    85.3
    
    
    
    75.4Other assets
    
    
    81.3
    
    
    
    86.1Total assets
    
    $
    1,415.0
    
    
    $
    1,343.6LIABILITIES AND SHAREOWNERS INVESTMENTCurrent Liabilities:Current portion of long-term debt
    
    $
    0.3
    
    
    $
    0.6Accounts payable
    
    
    82.2
    
    
    
    83.0Accrued compensation and benefits
    
    
    78.2
    
    
    
    57.8Other accrued liabilities
    
    
    80.4
    
    
    
    63.8Income taxes payable
    
    
    3.1
    
    
    
    5.9Restructuring accrual
    
    
    11.3
    
    
    
    22.5Liabilities of discontinued operations
    
    
    0.4
    
    
    
    2.5Total current liabilities
    
    
    255.9
    
    
    
    236.1Pension obligations and other long-term liabilities
    
    
    78.8
    
    
    
    95.6Long-term notes payable
    
    
    650.9
    
    
    
    651.0Total liabilities
    
    
    985.6
    
    
    
    982.7ADC Shareowners Investment:Total ADC shareowners investment (97.0 and 96.6 shares outstanding, respectively)
    
    
    424.6
    
    
    
    356.2Non-controlling interest
    
    
    4.8
    
    
    
    4.7Total shareowners investment
    
    
    429.4
    
    
    
    360.9Total liabilities and shareowners investment
    
    $
    1,415.0
    
    
    $
    1,343.6
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ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONSUNAUDITED
 Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions, except earnings per share)Net Sales:Products
    
    $
    264.4
    
    
    $
    258.4
    
    
    $
    732.0
    
    
    $
    748.5Services
    
    
    40.0
    
    
    
    31.9
    
    
    
    112.0
    
    
    
    98.1Total net sales
    
    
    304.4
    
    
    
    290.3
    
    
    
    844.0
    
    
    
    846.6Cost of Sales:Products
    
    
    164.7
    
    
    
    164.7
    
    
    
    459.2
    
    
    
    512.4Services
    
    
    26.7
    
    
    
    23.4
    
    
    
    79.8
    
    
    
    74.9Total cost of sales
    
    
    191.4
    
    
    
    188.1
    
    
    
    539.0
    
    
    
    587.3Gross Profit
    
    
    113.0
    
    
    
    102.2
    
    
    
    305.0
    
    
    
    259.3Operating Expenses:Research and development
    
    
    16.2
    
    
    
    16.0
    
    
    
    49.4
    
    
    
    50.3Selling and administration
    
    
    71.8
    
    
    
    59.7
    
    
    
    212.2
    
    
    
    196.6Impairment charges
    
    
    (0.1
    )
    
    
    0.3
    
    
    
    0.6
    
    
    
    412.4Restructuring charges
    
    
    (1.1
    )
    
    
    4.3
    
    
    
    12.5
    
    
    
    16.6Total operating expenses
    
    
    86.8
    
    
    
    80.3
    
    
    
    274.7
    
    
    
    675.9Operating Income (Loss)
    
    
    26.2
    
    
    
    21.9
    
    
    
    30.3
    
    
    
    (416.6
    )Other Income (Expense), net
    
    
    51.5
    
    
    
    (5.8
    )
    
    
    40.7
    
    
    
    (56.7
    )Income (Loss) before income taxes
    
    
    77.7
    
    
    
    16.1
    
    
    
    71.0
    
    
    
    (473.3
    )Provision (Benefit) for income taxes
    
    
    1.9
    
    
    
    0.9
    
    
    
    4.1
    
    
    
    (6.1
    )Income (Loss) from continuing operations
    
    
    75.8
    
    
    
    15.2
    
    
    
    66.9
    
    
    
    (467.2
    )Discontinued Operations, Net of TaxIncome (Loss) from discontinued operations
    
    
    (0.1
    )
    
    
    (8.3
    )
    
    
    (14.9
    )
    
    
    (20.0
    )Net Income (Loss)
    
    
    75.7
    
    
    
    6.9
    
    
    
    52.0
    
    
    
    (487.2
    )Net Income (Loss) Available to Non-controlling Interest
    
    
    (0.1
    )
    
    
    0.1
    
    
    
    0.6
    
    
    
    (1.3
    )Net Income (Loss) Available to Common Shareowners
    
    $
    75.8
    
    
    $
    6.8
    
    
    $
    51.4
    
    
    $
    (485.9
    )Comprehensive Income (Loss) Available to ADC Common Shareowners
    
    $
    71.5
    
    
    $
    19.9
    
    
    $
    52.9
    
    
    $
    (495.5
    )Comprehensive Income (Loss) Available to Non-controlling Interest
    
    
    (0.1
    )
    
    
    0.1
    
    
    
    0.6
    
    
    
    (1.3
    )Comprehensive Income (Loss)
    
    $
    71.4
    
    
    $
    20.0
    
    
    $
    53.5
    
    
    $
    (496.8
    )Weighted Average Common Shares Outstanding (Basic)
    
    
    97.0
    
    
    
    96.6
    
    
    
    96.9
    
    
    
    99.6Weighted Average Common Shares Outstanding (Diluted)
    
    
    121.6
    
    
    
    97.4
    
    
    
    98.0
    
    
    
    99.6Basic Earnings (Loss) Per Share:Continuing operations available to ADC common shareowners
    
    $
    0.78
    
    
    $
    0.16
    
    
    $
    0.68
    
    
    $
    (4.68
    )Discontinued operations available to ADC common shareowners
    
    
    
    
    
    $
    (0.09
    )
    
    $
    (0.15
    )
    
    $
    (0.20
    )Net income (loss) available to ADC common shareowners
    
    $
    0.78
    
    
    $
    0.07
    
    
    $
    0.53
    
    
    $
    (4.88
    )Diluted Earnings (Loss) Per Share:Continuing operations available to ADC common shareowners
    
    $
    0.68
    
    
    $
    0.16
    
    
    $
    0.68
    
    
    $
    (4.68
    )Discontinued operations available to ADC common shareowners
    
    
    
    
    
    $
    (0.09
    )
    
    $
    (0.15
    )
    
    $
    (0.20
    )Net income (loss) available to ADC common shareowners
    
    $
    0.68
    
    
    $
    0.07
    
    
    $
    0.53
    
    
    $
    (4.88
    )
  5




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ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWSUNAUDITED
 Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009(In millions)Operating Activities:Income/(loss) from continuing operations
    
    $
    66.9
    
    
    $
    (467.2
    )Adjustments to reconcile income/(loss) from continuing operations to net cash
provided by operating activities from continuing operations:Inventory write-offs
    
    
    5.2
    
    
    
    23.7Write-down of goodwill, intangibles and fixed assets
    
    
    0.6
    
    
    
    412.4Write-down of cost method investment
    
    
    5.3
    
    
    
    3.0Write-down of available-for-sale securities
    
    
    3.1
    
    
    
    41.3Depreciation and amortization
    
    
    46.4
    
    
    
    51.4Restructuring charges
    
    
    12.5
    
    
    
    16.5Provision for bad debt
    
    
    1.0
    
    
    
    2.0Change in warranty reserves
    
    
    (0.9
    )
    
    
    1.5Non-cash stock compensation
    
    
    11.9
    
    
    
    10.2Change in deferred income taxes
    
    
    (0.2
    )
    
    
    (4.4
    )(Gain)/loss on sale of property and equipment
    
    
    1.3
    
    
    
    (0.6
    )Amortization of deferred financing costs
    
    
    1.7
    
    
    
    2.5Gain on sale of investments
    
    
    (2.2
    )
    
    
    (0.4
    )Gain on sale of RF signal management product line
    
    
    (15.9
    )
    
    
    Other, net
    
    
    4.8
    
    
    
    5.1Changes in operating assets and liabilities, net of acquisitions and divestitures:Accounts receivable and unbilled revenues (increase)/decrease
    
    
    (32.3
    )
    
    
    29.5Inventories (increase)/decrease
    
    
    (0.2
    )
    
    
    20.2Prepaid and other assets (increase)/decrease
    
    
    (9.3
    )
    
    
    0.8Accounts payable increase/(decrease)
    
    
    0.6
    
    
    
    (6.3
    )Accrued liabilities increase/(decrease)
    
    
    6.0
    
    
    
    (65.1
    )Total cash provided by operating activities from continuing operations
    
    
    106.3
    
    
    
    76.1Total cash used for operating activities from discontinued operations
    
    
    (4.1
    )
    
    
    (7.2
    )Total cash provided by operating activities
    
    
    102.2
    
    
    
    68.9Investing Activities:Acquisitions, net of cash acquired
    
    
    (0.6
    )
    
    
    (2.7
    )Purchases of interests in affiliates
    
    
    (1.0
    )
    
    
    (1.2
    )Divestitures, net of cash disposed
    
    
    11.9
    
    
    
    Property, equipment and patent additions
    
    
    (21.8
    )
    
    
    (28.0
    )Proceeds from disposal of property and equipment
    
    
    0.3
    
    
    
    4.6Decrease/(increase) in restricted cash
    
    
    16.3
    
    
    
    (7.9
    )Purchase of available-for-sale securities
    
    
    (214.3
    )
    
    
    (52.0
    )Proceeds from sale of available-for-sale securities
    
    
    27.1
    
    
    
    11.9Other, net
    
    
    
    
    
    
    1.1Total cash used for investing activities from continuing operations
    
    
    (182.1
    )
    
    
    (74.2
    )Total cash used for investing activities from discontinued operations
    
    
    
    
    
    
    (0.1
    )Total cash used for investing activities
    
    
    (182.1
    )
    
    
    (74.3
    )Financing Activities:Payments of financing costs
    
    
    (1.6
    )
    
    
    Debt payments
    
    
    (0.5
    )
    
    
    (2.0
    )Common stock repurchase
    
    
    
    
    
    
    (101.2
    )Total cash used for financing activities
    
    
    (2.1
    )
    
    
    (103.2
    )Effect of Exchange Rate Changes on Cash
    
    
    (4.3
    )
    
    
    (5.0
    )Decrease in Cash and Cash Equivalents
    
    
    (86.3
    )
    
    
    (113.6
    )Cash and Cash Equivalents, beginning of period
    
    
    535.5
    
    
    
    601.9Cash and Cash Equivalents, end of period
    
    $
    449.2
    
    
    $
    488.3
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ADC TELECOMMUNICATIONS, INC. AND SUBSIDIARIES
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTSUNAUDITED
 Note 1: Basis of Presentation
   Fiscal Year
   Warranty
   Accrual
    
    
    Charged to costs
    
    
    
    
    
    
    AccrualSeptember 30, 2009
    
    
    and expenses
    
    
    Deductions
    
    
    July 2, 2010Warranty Reserve
    
    $
    6.2
    
    
    $
    (0.9
    )
    
    $
    0.7
    
    
    $
    4.6
 Share-Based Compensation
  7




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Summary of Significant Accounting Policies
  Recently Adopted Accounting Pronouncements
 Business combinations and non-controlling interests
  Fair Value Measurements
    Accounting for Convertible Debt Instruments That May be Settled in Cash upon Conversion
(Including Partial Cash Settlement)
  Determining Whether an Instrument (or an Embedded Feature) is Indexed to an Entitys Own Stock
  8




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Note 2: Discontinued Operations
 GSM Business
   APS Germany
  APS France
   Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)
    
    
    (In millions)Net sales
    
    $
    
    
    
    $
    8.2
    
    
    $
    2.3
    
    
    $
    27.4Loss from discontinued operations
    
    $
    (0.1
    )
    
    $
    (3.1
    )
    
    $
    (1.9
    )
    
    $
    (14.8
    )Loss on sale of discontinued operations
    
    
    
    
    
    
    (5.2
    )
    
    
    (13.0
    )
    
    
    (5.2
    )Total loss of discontinued operations
    
    $
    (0.1
    )
    
    $
    (8.3
    )
    
    $
    (14.9
    )
    
    $
    (20.0
    )
 Note 3: Net Income (Loss) from Continuing Operations Per Share
  Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions, except
    
    
    (In millions, exceptper share amounts)
    
    
    per share amounts)Numerator:Net income (loss) from continuing operations
    
    $
    75.8
    
    
    $
    15.2
    
    
    $
    66.9
    
    
    $
    (467.2
    )Net income (loss) available to non-controlling interest
    
    
    (0.1
    )
    
    
    0.1
    
    
    
    0.6
    
    
    
    (1.3
    )Income (loss) from continuing operations available to common shareowners
    
    $
    75.9
    
    
    $
    15.1
    
    
    $
    66.3
    
    
    $
    (465.9
    )Interest and amortization expense for convertible notes
    
    
    6.6
    
    
    
    
    
    
    
    
    
    
    
    
 9




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Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions, except
    
    
    (In millions, exceptper share amounts)
    
    
    per share amounts)Diluted income (loss) from continuing operations available to common shareowners
    
    $
    82.5
    
    
    $
    15.1
    
    
    $
    66.3
    
    
    $
    (465.9
    )Denominator:Weighted average common shares outstanding  basic
    
    
    97.0
    
    
    
    96.6
    
    
    
    96.9
    
    
    
    99.6Convertible bonds converted to common stock
    
    
    23.3
    
    
    
    
    
    
    
    
    
    
    
    Employee options and other
    
    
    1.3
    
    
    
    0.8
    
    
    
    1.1
    
    
    
    Weighted average common shares outstanding  diluted
    
    
    121.6
    
    
    
    97.4
    
    
    
    98.0
    
    
    
    99.6Basic Income (loss) per share from continuing operations available to ADC common
shareowners
    
    $
    0.78
    
    
    $
    0.16
    
    
    $
    0.68
    
    
    $
    (4.68
    )Diluted Income (loss) per share from continuing operations available to ADC
common shareowners
    
    $
    0.68
    
    
    $
    0.16
    
    
    $
    0.68
    
    
    $
    (4.68
    )
   Convertible Shares
    
    
    ConversionConvertible Subordinated Notes
    
    July 2, 2010
    
    
    Price$200 million, 6-month LIBOR plus 0.375%, due June 15, 2013
    
    
    7.1
    
    
    
    28.091$225 million, 3.5% fixed rate, due July 15, 2015
    
    
    8.3
    
    
    
    27.000$225 million, 3.5% fixed rate, due July 15, 2017
    
    
    7.9
    
    
    
    28.550Total
    
    
    23.3
  Note 4: Inventories
  July 2,
    
    
    September 30,2010
    
    
    2009(In millions)Manufactured products
    
    $
    94.9
    
    
    $
    111.9Purchased materials
    
    
    50.8
    
    
    
    48.6Work-in-process
    
    
    6.7
    
    
    
    5.9Less: Inventory reserve
    
    
    (36.1
    )
    
    
    (41.8
    )Total inventories, net
    
    $
    116.3
    
    
    $
    124.6
 10




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Note 5: Property and Equipment
  July 2,
    
    
    September 30,2010
    
    
    2009(In millions)Land and buildings
    
    $
    135.0
    
    
    $
    135.5Machinery and equipment
    
    
    368.9
    
    
    
    390.3Furniture and fixtures
    
    
    32.3
    
    
    
    38.0Less: Accumulated depreciation
    
    
    (398.5
    )
    
    
    (410.1
    )Total
    
    
    137.7
    
    
    
    153.7Construction-in-progress
    
    
    10.2
    
    
    
    9.1Total property and equipment, net
    
    $
    147.9
    
    
    $
    162.8
 Note 6: Investments
  Other-Than-TemporaryCost
    
    
    Unrealized
    
    
    Realized
    
    
    Impairment
    
    
    FairBasis
    
    
    Gain (3)
    
    
    Loss (3)
    
    
    Loss (3)
    
    
    Value(In millions)July 2, 2010Corporate commercial paper, CDs and bonds
    
    $
    174.4
    
    
    $
    0.1
    
    
    $
    
    
    
    $
    
    
    
    $
    174.5Government bonds
    
    
    80.3
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    80.4Auction rate securities
    
    
    83.7
    
    
    
    2.7
    
    
    
    
    
    
    
    
    
    
    
    11.4
    (1)Total available-for-sale securities
    
    $
    338.4
    
    
    $
    2.9
    
    
    $
    
    
    
    $
    
    
    
    $
    266.3September 30, 2009Corporate bonds
    
    $
    50.7
    
    
    $
    0.4
    
    
    $
    
    
    
    $
    
    
    
    $
    51.1Government bonds
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity securities
    
    
    0.1
    
    
    
    0.1
    
    
    
    0.1
    
    
    
    
    
    
    
    Auction rate securities
    
    
    169.8
    
    
    
    2.3
    
    
    
    
    
    
    
    18.4
    
    
    
    24.3
    (2)Total available-for-sale securities
    
    $
    220.6
    
    
    $
    2.8
    
    
    $
    0.1
    
    
    $
    18.4
    
    
    $
    75.4
 
 (1)
    
    Net of cumulative unrealized gains of $3.2 million and other-than-temporary losses of $75.5
million(2)
    
    Net of cumulative unrealized gains of $2.9 million and other-than-temporary losses of $148.4
million(3)
    
    For the nine and eleven months ended July 2, 2010 and September 30, 2009, respectively      11




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##### Table of Contents



Note 7: Goodwill and Intangible Assets
      12




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##### Table of Contents



NetworkConnectivity
    
    
    Solutions
    
    
    Total(In millions)Balance as of September 30, 2009
    
    $
    0.2
    
    
    $
    
    
    
    $
    0.2Century Man 2009 Earn-out
    
    
    5.8
    
    
    
    
    
    
    
    5.8Balance as of July 2, 2010
    
    $
    6.0
    
    
    $
    
    
    
    $
    6.0
  Note 8: Notes Payable
  July 2, 2010
    
    
    September 30, 2009(In millions)Convertible subordinated notes, six-month LIBOR plus 0.375%, due June 15, 2013
    
    $
    200.0
    
    
    $
    200.0Convertible subordinated notes, 3.5% fixed rate, due July 15, 2015
    
    
    225.0
    
    
    
    225.0Convertible subordinated notes, 3.5% fixed rate, due July 15, 2017
    
    
    225.0
    
    
    
    225.0Total convertible subordinated notes
    
    
    650.0
    
    
    
    650.0Other, variable rate debt, various due dates
    
    
    1.2
    
    
    
    1.6Total notes payable and other debt
    
    
    651.2
    
    
    
    651.6Less: Current portion of notes payable and other debt
    
    
    0.3
    
    
    
    0.6Long-term notes payable
    
    $
    650.9
    
    
    $
    651.0
  Credit Facility
    13




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##### Table of Contents



Note 9: Income Taxes
    Note 10: Comprehensive Income (Loss)
   Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)
    
    
    (In millions)Net income (loss)
    
    $
    75.8
    
    
    $
    6.8
    
    
    $
    51.4
    
    
    $
    (485.9
    )Change in foreign currency translation adjustment
    
    
    (1.8
    )
    
    
    6.4
    
    
    
    4.3
    
    
    
    (7.4
    )Net change in fair value of interest rate swap
    
    
    (2.9
    )
    
    
    3.6
    
    
    
    (2.7
    )
    
    
    (10.5
    )Net change in fair value of Mexican peso hedge
    
    
    (0.7
    )
    
    
    2.1
    
    
    
    (0.2
    )
    
    
    0.6Pension obligation adjustment, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6.4Unrealized gain on available-for-sale securities
    
    
    1.1
    
    
    
    1.0
    
    
    
    0.1
    
    
    
    1.3
 14




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##### Table of Contents



Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)
    
    
    (In millions)Total comprehensive income (loss) available to ADC common
shareowners
    
    
    71.5
    
    
    
    19.9
    
    
    
    52.9
    
    
    
    (495.5
    )Comprehensive earnings (loss) available to non-controlling interests
    
    
    (0.1
    )
    
    
    0.1
    
    
    
    0.6
    
    
    
    (1.3
    )Total comprehensive income (loss)
    
    $
    71.4
    
    
    $
    20.0
    
    
    $
    53.5
    
    
    $
    (496.8
    )
  Note 11: Changes in Shareowners Investment
  Accumulated OtherCommon Stock
    
    
    Paid-In
    
    
    Accumulated
    
    
    Comprehensive
    
    
    Non-ControllingShares
    
    
    Amount
    
    
    Capital
    
    
    Deficit
    
    
    Income (Loss)
    
    
    Interests
    
    
    Total(In millions)Beginning Balance September 30,
2009
    
    
    96.6
    
    
    $
    23.6
    
    
    $
    1,311.9
    
    
    $
    (965.9
    )
    
    $
    (13.4
    )
    
    $
    4.7
    
    
    $
    360.9Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    51.4
    
    
    
    
    
    
    
    0.6
    
    
    
    52.0Other comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.5
    
    
    
    
    
    
    
    1.5Total comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    51.4
    
    
    
    1.5
    
    
    
    0.6
    
    
    
    53.5Exercise of common stock
options and restricted stock
releases
    
    
    0.4
    
    
    
    0.1
    
    
    
    (1.5
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1.4
    )Share-based compensation expense
    
    
    
    
    
    
    
    
    
    
    11.6
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11.6Purchase of subsidiary shares
from non-controlling interests
    
    
    
    
    
    
    
    
    
    
    (0.2
    )
    
    
    
    
    
    
    
    
    
    
    (0.4
    )
    
    
    (0.6
    )Distributions to
non-controlling interests
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (0.1
    )
    
    
    (0.1
    )Other (1)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5.5
    
    
    
    
    
    
    
    
    
    
    
    5.5Balance as of July 2, 2010
    
    
    97.0
    
    
    $
    23.7
    
    
    $
    1,321.8
    
    
    $
    (909.0
    )
    
    $
    (11.9
    )
    
    $
    4.8
    
    
    $
    429.4
 
 (1)
    
    Reclassification of credit losses related to auction rate securities. Note 12: Segment and Geographic Information
   
    
    Connectivity
    
    Network Solutions
    
    Professional Services
 Connectivity
 Network Solutions
 15




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##### Table of Contents



Professional Services
   Network
    
    
    Professional
    
    
    
    
    
    
    Restructuring
    
    
    GAAPConnectivity
    
    
    Solutions
    
    
    Services
    
    
    Consolidated
    
    
    and Impairment
    
    
    Consolidated(In millions)Three Months Ended July 2, 2010External net sales:Products
    
    $
    229.2
    
    
    $
    22.9
    
    
    $
    12.3
    
    
    $
    264.4
    
    
    $
    
    
    
    $
    264.4Services
    
    
    0.9
    
    
    
    5.9
    
    
    
    33.2
    
    
    
    40.0
    
    
    
    
    
    
    
    40.0Total external net sales
    
    
    230.1
    
    
    
    28.8
    
    
    
    45.5
    
    
    
    304.4
    
    
    
    
    
    
    
    304.4Depreciation and amortization
    
    
    13.4
    
    
    
    1.1
    
    
    
    0.7
    
    
    
    15.2
    
    
    
    
    
    
    
    15.2Operating income (loss)
    
    $
    24.7
    
    
    $
    (2.6
    )
    
    $
    2.9
    
    
    $
    25.0
    
    
    $
    1.2
    
    
    $
    26.2Three Months Ended June 26, 2009External net sales:Products
    
    $
    232.0
    
    
    $
    16.7
    
    
    $
    9.7
    
    
    $
    258.4
    
    
    $
    
    
    
    $
    258.4Services
    
    
    0.7
    
    
    
    3.7
    
    
    
    27.5
    
    
    
    31.9
    
    
    
    
    
    
    
    31.9Total external net sales
    
    
    232.7
    
    
    
    20.4
    
    
    
    37.2
    
    
    
    290.3
    
    
    
    
    
    
    
    290.3Depreciation and amortization
    
    
    14.0
    
    
    
    0.7
    
    
    
    0.6
    
    
    
    15.3
    
    
    
    
    
    
    
    15.3Operating income (loss)
    
    $
    28.0
    
    
    $
    (4.4
    )
    
    $
    2.9
    
    
    $
    26.5
    
    
    $
    (4.6
    )
    
    $
    21.9
 Network
    
    
    Professional
    
    
    
    
    
    
    Restructuring
    
    
    GAAPConnectivity
    
    
    Solutions
    
    
    Services
    
    
    Consolidated
    
    
    and Impairment
    
    
    Consolidated(In millions)Nine Months Ended July 2, 2010External net sales:Products
    
    $
    642.7
    
    
    $
    57.8
    
    
    $
    31.5
    
    
    $
    732.0
    
    
    $
    
    
    
    $
    732.0Services
    
    
    2.8
    
    
    
    16.4
    
    
    
    92.8
    
    
    
    112.0
    
    
    
    
    
    
    
    112.0Total external net sales
    
    
    645.5
    
    
    
    74.2
    
    
    
    124.3
    
    
    
    844.0
    
    
    
    
    
    
    
    844.0Depreciation and amortization
    
    
    41.1
    
    
    
    3.1
    
    
    
    2.2
    
    
    
    46.4
    
    
    
    
    
    
    
    46.4Operating income (loss)
    
    $
    50.7
    
    
    $
    (13.1
    )
    
    $
    5.8
    
    
    $
    43.4
    
    
    $
    (13.1
    )
    
    $
    30.3Nine Months Ended June 26, 2009External net sales:Products
    
    $
    673.3
    
    
    $
    44.8
    
    
    $
    30.4
    
    
    $
    748.5
    
    
    $
    
    
    
    $
    748.5Services
    
    
    0.8
    
    
    
    14.0
    
    
    
    83.3
    
    
    
    98.1
    
    
    
    
    
    
    
    98.1Total external net sales
    
    
    674.1
    
    
    
    58.8
    
    
    
    113.7
    
    
    
    846.6
    
    
    
    
    
    
    
    846.6Depreciation and amortization
    
    
    44.8
    
    
    
    4.6
    
    
    
    2.0
    
    
    
    51.4
    
    
    
    
    
    
    
    51.4Operating income (loss)
    
    $
    34.0
    
    
    $
    (27.3
    )
    
    $
    5.7
    
    
    $
    12.4
    
    
    $
    (429.0
    )
    
    $
    (416.6
    )
 Geographic Information
  Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)
    
    
    (In millions)Geographic Sales Information:Inside the United States
    
    $
    191.4
    
    
    $
    178.8
    
    
    $
    510.2
    
    
    $
    499.1Outside the United States:Asia Pacific (Australia, Hong Kong, India,
Japan, Korea, New Zealand, Southeast Asia
and Taiwan)
    
    
    30.1
    
    
    
    24.2
    
    
    
    90.2
    
    
    
    77.5
 16




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##### Table of Contents



Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)
    
    
    (In millions)China (1)
    
    
    17.0
    
    
    
    22.0
    
    
    
    54.5
    
    
    
    61.0EMEA (Europe, Middle East and Africa)
    
    
    44.2
    
    
    
    47.6
    
    
    
    129.7
    
    
    
    146.9Americas (Canada, Central and South America)
    
    
    21.7
    
    
    
    17.7
    
    
    
    59.4
    
    
    
    62.1Total net sales
    
    $
    304.4
    
    
    $
    290.3
    
    
    $
    844.0
    
    
    $
    846.6Property and Equipment, Net: (2)Inside the United States
    
    $
    104.2Outside the United States
    
    
    43.7Total property and equipment, net
    
    $
    147.9
 
 (1)
    
    Due to the significance of its net sales, China is broken out for geographic purposes.(2)
    
    Other than the United States, no single country has property and equipment sufficiently
material to disclose. Note 13: Impairment, Restructuring and Other Disposal Charges
  Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)
    
    
    (In millions)Impairments:Fixed asset write-downs
    
    $
    (0.1
    )
    
    $
    0.3
    
    
    $
    0.6
    
    
    $
    1.0Goodwill and intangibles
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    411.4Total impairment charges
    
    
    (0.1
    )
    
    
    0.3
    
    
    
    0.6
    
    
    
    412.4Restructuring charges:Employee severance
    
    
    (1.3
    )
    
    
    4.6
    
    
    
    11.8
    
    
    
    15.6Facilities consolidation and lease termination
    
    
    0.2
    
    
    
    (0.3
    )
    
    
    0.7
    
    
    
    1.0Total restructuring charges
    
    
    (1.1
    )
    
    
    4.3
    
    
    
    12.5
    
    
    
    16.6Other disposal charges:Inventory write-offs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14.0Total impairment, restructuring and other disposal charges
    
    $
    (1.2
    )
    
    $
    4.6
    
    
    $
    13.1
    
    
    $
    443.0
 Impairment Charges:
 Restructuring Charges:
    17




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##### Table of Contents



Other Disposal Charges:
  ContinuingAccrual
    
    
    Operations Net
    
    
    Cash payments
    
    
    AccrualType of Charge
    
    September 30, 2009
    
    
    Additions
    
    
    Charged to accrual
    
    
    July 2, 2010(In millions)Employee severance costs
    
    $
    29.1
    
    
    $
    11.8
    
    
    $
    25.3
    
    
    $
    15.6Facilities consolidation
    
    
    7.6
    
    
    
    0.7
    
    
    
    1.5
    
    
    
    6.8Total restructuring accrual
    
    $
    36.7
    
    
    $
    12.5
    
    
    $
    26.8
    
    
    $
    22.4
  Severance
    
    
    Facilities(In millions)2010
    
    $
    6.6
    
    
    $
    0.72011
    
    
    3.1
    
    
    
    1.72012
    
    
    2.6
    
    
    
    1.22013
    
    
    1.7
    
    
    
    1.12014
    
    
    1.0
    
    
    
    1.1Thereafter
    
    
    0.6
    
    
    
    1.0Total
    
    $
    15.6
    
    
    $
    6.8
  Note 14: Other Income (Expense), Net
  Three Months ended
    
    
    Nine Months endedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)Interest income on investments
    
    $
    1.1
    
    
    $
    1.8
    
    
    $
    3.5
    
    
    $
    9.4Interest expense on borrowings
    
    
    (6.9
    )
    
    
    (6.7
    )
    
    
    (20.5
    )
    
    
    (21.5
    )Interest expense, net
    
    
    (5.8
    )
    
    
    (4.9
    )
    
    
    (17.0
    )
    
    
    (12.1
    )Loss recognized on impairment of available-for-sale securities
    
    
    
    
    
    
    (0.7
    )
    
    
    (3.1
    )
    
    
    (41.3
    )Gain realized on sale of available-for-sale-securities
    
    
    4.6
    
    
    
    
    
    
    
    2.2
    
    
    
    0.4Write-down of cost method investments
    
    
    
    
    
    
    
    
    
    
    (5.3
    )
    
    
    (3.0
    )Foreign exchange loss
    
    
    (1.0
    )
    
    
    
    
    
    
    (4.0
    )
    
    
    (0.8
    )Gain (loss) on sale of fixed assets
    
    
    (0.2
    )
    
    
    (0.1
    )
    
    
    (1.3
    )
    
    
    0.6Gain on sale of product line
    
    
    
    
    
    
    
    
    
    
    15.9
    
    
    
    Settlement of auction rate securities claims, net of $2.1 million in fees
    
    
    54.4
    
    
    
    
    
    
    
    54.4
    
    
    
    Other, net
    
    
    (0.5
    )
    
    
    (0.1
    )
    
    
    (1.1
    )
    
    
    (0.5
    )Subtotal
    
    
    57.3
    
    
    
    (0.9
    )
    
    
    57.7
    
    
    
    (44.6
    )Total other income (expense), net
    
    $
    51.5
    
    
    $
    (5.8
    )
    
    $
    40.7
    
    
    $
    (56.7
    )
  18




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##### Table of Contents



Note 15: Commitments and Contingencies
 Legal Contingencies
  19




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##### Table of Contents



Change of Control
 Note 16: Fair Value Measurements
  Fair Value Hierarchy
  Level 1
  Level 2
   
    
    Determining which instruments are most similar to the instrument being priced requires
management to identify a sample of similar securities based on the coupon rates, maturity,
issuer, credit rating and instrument type, as well as to select, on a subjective basis, an
individual security or multiple securities that are deemed most similar to the security
being priced; and
    
    Determining whether a market is considered active requires management judgment.
 Level 3
   20




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##### Table of Contents



Assets and Liabilities Measured at Fair Value on a Recurring Basis
  Fair Value Measurements at Reporting Date UsingQuoted Prices inActive Markets
    
    
    
    
    
    
    Significantfor Identical
    
    
    Significant Other
    
    
    UnobservableJuly 2,
    
    
    Assets
    
    
    Observable Inputs
    
    
    InputsDescription
    
    2010
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:Cash and cash equivalents
    
    $
    449.2
    
    
    $
    449.2
    
    
    $
    
    
    
    $
    Corporate commercial paper, CDs and bonds
    
    
    174.5
    
    
    
    174.5
    
    
    
    
    
    
    
    Government bonds
    
    
    80.4
    
    
    
    80.4
    
    
    
    
    
    
    
    Restricted cash
    
    
    8.1
    
    
    
    8.1
    
    
    
    
    
    
    
    Auction rate securities
    
    
    11.4
    
    
    
    
    
    
    
    11.4
    
    
    
    Total assets measured at fair value
    
    $
    723.6
    
    
    $
    712.2
    
    
    $
    11.4
    
    
    $
    Liabilities:Interest rate swap liabilities (1)
    
    
    14.9
    
    
    
    
    
    
    
    14.9
    
    
    
    Total liabilities measured at fair value
    
    $
    14.9
    
    
    $
    
    
    
    $
    14.9
    
    
    $
    
 Fair Value Measurements at Reporting Date UsingQuoted Prices inActive Markets
    
    
    
    
    
    
    Significantfor Identical
    
    
    Significant Other
    
    
    UnobservableSeptember 30,
    
    
    Assets
    
    
    Observable Inputs
    
    
    InputsDescription
    
    2009
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Assets:Cash and cash equivalents
    
    $
    535.5
    
    
    $
    535.5
    
    
    $
    
    
    
    $
    Corporate commercial paper, CDs and bonds
    
    
    51.1
    
    
    
    51.1
    
    
    
    
    
    
    
    Foreign currency hedges
    
    
    0.4
    
    
    
    
    
    
    
    0.4
    
    
    
    Restricted cash
    
    
    25.0
    
    
    
    25.0
    
    
    
    
    
    
    
    Auction rate securities
    
    
    24.3
    
    
    
    
    
    
    
    
    
    
    
    24.3Total assets measured at fair value
    
    $
    636.3
    
    
    $
    611.6
    
    
    $
    0.4
    
    
    $
    24.3Liabilities:Interest rate swap liabilities (1)
    
    
    12.2
    
    
    
    
    
    
    
    12.2
    
    
    
    Total liabilities measured at fair value
    
    $
    12.2
    
    
    $
    
    
    
    $
    12.2
    
    
    $
    
 
 (1)
    
    Short-term portion included in other accrued liabilities and long-term portion
included in other long-term liabilities on the consolidated balance sheet. The short-term
and long-term portions for July 2, 2010 were liabilities of $9.4 million and $5.5 million,
respectively. The short-term and long-term portions for September 30, 2009 were liabilities
of $5.0 million and $7.2 million, respectively.  Fair ValueMeasurements UsingSignificantUnobservable Inputs(Level 3)Balance as of September 30, 2009
    $
    24.3Total gains or losses (realized or unrealized)Included in earnings  Other Income (expense), net
    
    (1.1
    )Included in other comprehensive income
    
    2.7Sales
    
    (14.5
    )Transfers in and/or out of Level 3
    
    (11.4
    )Balance as of July 2, 2010
    $
    
 21




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##### Table of Contents



Fair ValueMeasurements UsingSignificantUnobservable Inputs(Level 3)Balance as of October 31, 2008
    
    $
    40.4Total gains or losses (realized or unrealized)Included in earnings  Other Income (expense), net
    
    
    (18.4
    )Included in other comprehensive income
    
    
    2.3Sales
    
    
    Transfers in and/or out of Level 3
    
    
    Balance as of September 30, 2009
    
    
    $24.3
  Note 17: Derivative Instruments and Hedging Activities
      22




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##### Table of Contents



Year Swapentered into
    
    Fixed Rate
    
    
    Notional Amount
    
    
    Expiration Date2008
    
    
    4.0%
    
    
    
    $200,000,000
    
    
    June 2013
    Derivatives in cash flow hedging relationships
    
    Interest rate swap (1)
    
    
    Mexican peso hedge (2)
    
    
    TotalBalance as of  September 30, 2009
    
    $
    (12.2
    )
    
    $
    0.4
    
    
    $
    (11.8
    )Amount of (gain) loss recognized in Other
Comprehensive Income on derivative (effective
portion)
    
    
    (7.7
    )
    
    
    0.6
    
    
    
    (7.1
    )Amount of (gain) loss reclassified from Other
Comprehensive Income into income (effective
portion) (3)
    
    
    5.0
    
    
    
    (1.0
    )
    
    
    4.0Balance as of July 2, 2010
    
    $
    (14.9
    )
    
    $
    
    
    
    $
    (14.9
    )
 
 (1)
    
    Short-term portion included in other accrued liabilities and long-term portion included in
other long-term liabilities on the consolidated balance sheet. The short-term and long-term
portions for July 2, 2010 were liabilities of $9.4 million and $5.5 million, respectively. The
short-term and long-term portions for September 30, 2009 were liabilities of $5.0 million and
$7.2 million, respectively.(2)
    
    Assets are included in prepaid expenses and other current assets and liabilities are
included in other accrued liabilities on the consolidated balance sheet.(3)
    
    Gains and losses are reclassified to interest income (expense) for the interest rate swap and
cost of goods sold for the Mexican peso hedge.     Derivatives not designated as hedging instruments under SFAS 133
    
    
    Amount of gain (loss) recognized in income on derivativeClassification of gain
(loss) recognized in
    
    
    Three months ended
    
    
    Nine Months endedincome on derivative
    
    
    July 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009Foreign currency hedges
    
    Other income (expense), net
    
    
    $1.2
    
    
    
    $(1.5)
    
    
    
    $1.1
    
    
    
    $2.9
 23




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##### Table of Contents



Note 18: Subsequent Event
   
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Overview
 Merger
   Our Business
    24




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##### Table of Contents




    
    Connectivity
    
    Network Solutions
    
    Professional Services
 Connectivity
 Network Solutions
 Professional Services
 Marketplace Conditions
  Industry Conditions
   
    
    First, businesses and consumers worldwide are becoming increasingly dependent on
broadband, multi-service communications networks to conduct a wide range of daily
communications tasks (e.g., emails with large amounts of data, teleconferencing, social
networking, video streaming and photo sharing).
    
    Second, end-users of communications services increasingly expect to do business over a
single network connection at a low price. Both public networks operated by communications
service providers and private enterprise networks are evolving to provide combinations of
Internet, data, video and voice services that can be offered over the same high-speed
network.
  25




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##### Table of Contents



i.e.
  Strategy
  
    
    Business growth in fiber-based and wireless communications networks, as well as in
growing markets and geographies;
    
    Operational excellence that drives low-cost industry leadership and provides our
customers with superior products and support; and
    
    High levels of customer service and focus through alignment with the next generation
network needs of our global customer base.
 Business Growth in Areas of High Strategic Importance.
 Operational Excellence and Low Cost Industry Leadership
  Improved Customer Service and Focus
  26




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##### Table of Contents



Results of Operations
 Net Sales
   PercentageThree months ended
    
    
    Increase (Decrease)July 2, 2010
    
    
    June 26, 2009
    
    
    Between Periods(In millions)Net sales
    
    $
    304.4
    
    
    $
    290.3
    
    
    
    4.9
    %Cost of sales
    
    
    191.4
    
    
    
    188.1
    
    
    
    1.8Gross profit
    
    
    113.0
    
    
    
    102.2
    
    
    
    10.6Gross margin
    
    
    37.1
    %
    
    
    35.2
    %Operating expenses:Research and development
    
    
    16.2
    
    
    
    16.0
    
    
    
    1.3Selling and administration
    
    
    71.8
    
    
    
    59.7
    
    
    
    20.3Impairment charges
    
    
    (0.1
    )
    
    
    0.3
    
    
    
    (133.3
    )Restructuring charges
    
    
    (1.1
    )
    
    
    4.3
    
    
    
    (125.6
    )Total operating expenses
    
    
    86.8
    
    
    
    80.3
    
    
    
    8.1Operating income (loss)
    
    
    26.2
    
    
    
    21.9
    
    
    
    19.6Operating margin
    
    
    8.6
    %
    
    
    7.5
    %Other income (expense), net:Interest income, net
    
    
    (5.8
    )
    
    
    (4.9
    )
    
    
    18.4Other, net
    
    
    57.3
    
    
    
    (0.9
    )
    
    
    Income (loss) before income taxes
    
    
    77.7
    
    
    
    16.1
    
    
    
    382.6Provision for income taxes
    
    
    1.9
    
    
    
    0.9
    
    
    
    111.1Income (loss) from continuing operations
    
    $
    75.8
    
    
    $
    15.2
    
    
    
    398.7
    %
 PercentageNine Months ended
    
    
    Increase (Decrease)July 2, 2010
    
    
    June 26, 2009
    
    
    Between Periods(In millions)Net sales
    
    $
    844.0
    
    
    $
    846.6
    
    
    
    (0.3
    )%Cost of sales
    
    
    539.0
    
    
    
    587.3
    
    
    
    (8.2
    )Gross profit
    
    
    305.0
    
    
    
    259.3
    
    
    
    17.6Gross margin
    
    
    36.1
    %
    
    
    30.6
    %Operating expenses:Research and development
    
    
    49.4
    
    
    
    50.3
    
    
    
    (1.8
    )Selling and administration
    
    
    212.2
    
    
    
    196.6
    
    
    
    7.9Impairment charges
    
    
    0.6
    
    
    
    412.4
    
    
    
    (99.9
    )Restructuring charges
    
    
    12.5
    
    
    
    16.6
    
    
    
    (24.7
    )Total operating expenses
    
    
    274.7
    
    
    
    675.9
    
    
    
    (59.4
    )Operating income (loss)
    
    
    30.3
    
    
    
    (416.6
    )
    
    
    107.3Operating margin
    
    
    3.6
    %
    
    
    (49.2
    )%Other income (expense), net:Interest income, net
    
    
    (17.0
    )
    
    
    (12.1
    )
    
    
    40.5Other, net
    
    
    57.7
    
    
    
    (44.6
    )
    
    
    229.4Income (loss) before income taxes
    
    
    71.0
    
    
    
    (473.3
    )
    
    
    115.0Provision (benefit) for income taxes
    
    
    4.1
    
    
    
    (6.1
    )
    
    
    167.2Income (loss) from continuing operations
    
    $
    66.9
    
    
    $
    (467.2
    )
    
    
    114.3
    %
 27




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##### Table of Contents



PercentageThree months ended
    
    
    Increase (Decrease)July 2, 2010
    
    
    June 26, 2009
    
    
    Between PeriodsReportable Segment
    
    (In millions)ConnectivityProducts
    
    $
    229.2
    
    
    $
    232.0
    
    
    
    (1.2
    )%Services
    
    
    0.9
    
    
    
    0.7
    
    
    
    28.6Total Connectivity
    
    
    230.1
    
    
    
    232.7
    
    
    
    (1.1
    )Network Solutions:Products
    
    
    22.9
    
    
    
    16.7
    
    
    
    37.1Services
    
    
    5.9
    
    
    
    3.7
    
    
    
    59.5Total Network Solutions
    
    
    28.8
    
    
    
    20.4
    
    
    
    41.2Professional Services:Products
    
    
    12.3
    
    
    
    9.7
    
    
    
    26.8Services
    
    
    33.2
    
    
    
    27.5
    
    
    
    20.7Total Professional Services
    
    
    45.5
    
    
    
    37.2
    
    
    
    22.3Total Net Sales
    
    $
    304.4
    
    
    $
    290.3
    
    
    
    4.9
    %
 PercentageNine Months ended
    
    
    Increase (Decrease)July 2, 2010
    
    
    June 26, 2009
    
    
    Between PeriodsReportable Segment
    
    
    
    
    
    (In millions)ConnectivityProducts
    
    $
    642.7
    
    
    $
    673.3
    
    
    
    (4.5
    )%Services
    
    
    2.8
    
    
    
    0.8
    
    
    
    250.0Total Connectivity
    
    
    645.5
    
    
    
    674.1
    
    
    
    (4.2
    )Network Solutions:Products
    
    
    57.8
    
    
    
    44.8
    
    
    
    29.0Services
    
    
    16.4
    
    
    
    14.0
    
    
    
    17.1Total Network Solutions
    
    
    74.2
    
    
    
    58.8
    
    
    
    26.2Professional Services:Products
    
    
    31.5
    
    
    
    30.4
    
    
    
    3.6Services
    
    
    92.8
    
    
    
    83.3
    
    
    
    11.4Total Professional Services
    
    
    124.3
    
    
    
    113.7
    
    
    
    9.3Total Net Sales
    
    $
    844.0
    
    
    $
    846.6
    
    
    
    (0.3
    )%
   28




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##### Table of Contents



Gross Margins
   Operating Expenses
  Research and development:
 Selling and administration:
 29




---



##### Table of Contents



Restructuring charges:
    Other Disposal Charges:
 Impairment Charges:
 Other Income (Expense), Net
  Three Months ended
    
    
    Nine Months endedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)Interest income on investments
    
    $
    1.1
    
    
    $
    1.8
    
    
    $
    3.5
    
    
    $
    9.4Interest expense on borrowings
    
    
    (6.9
    )
    
    
    (6.7
    )
    
    
    (20.5
    )
    
    
    (21.5
    )Interest expense, net
    
    
    (5.8
    )
    
    
    (4.9
    )
    
    
    (17.0
    )
    
    
    (12.1
    )Loss recognized on impairment of available-for-sale securities
    
    
    
    
    
    
    (0.7
    )
    
    
    (3.1
    )
    
    
    (41.3
    )Gain realized on sale of available-for-sale-securities
    
    
    4.6
    
    
    
    
    
    
    
    2.2
    
    
    
    0.4Write-down of cost method investments
    
    
    
    
    
    
    
    
    
    
    (5.3
    )
    
    
    (3.0
    )Foreign exchange loss
    
    
    (1.0
    )
    
    
    
    
    
    
    (4.0
    )
    
    
    (0.8
    )Gain (loss) on sale of fixed assets
    
    
    (0.2
    )
    
    
    (0.1
    )
    
    
    (1.3
    )
    
    
    0.6Gain on sale of product line
    
    
    
    
    
    
    
    
    
    
    15.9
    
    
    
    Settlement of auction rate securities claims, net of $2.1 million in fees
    
    
    54.4
    
    
    
    
    
    
    
    54.4
    
    
    
    Other, net
    
    
    (0.5
    )
    
    
    (0.1
    )
    
    
    (1.1
    )
    
    
    (0.5
    )Subtotal
    
    
    57.3
    
    
    
    (0.9
    )
    
    
    57.7
    
    
    
    (44.6
    )Total other income (expense), net
    
    $
    51.5
    
    
    $
    (5.8
    )
    
    $
    40.7
    
    
    $
    (56.7
    )
 30




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##### Table of Contents



Income Taxes
   Three Months Ended
    
    
    Nine Months EndedJuly 2, 2010
    
    
    June 26, 2009
    
    
    July 2, 2010
    
    
    June 26, 2009(In millions)Income tax provision (benefit)
    
    $
    1.9
    
    
    $
    0.9
    
    
    $
    4.1
    
    
    $
    (6.1
    )Income (loss) before income taxes
    
    $
    77.7
    
    
    $
    16.1
    
    
    $
    71.0
    
    
    $
    (473.3
    )Effective income tax rate
    
    
    2.4
    %
    
    
    5.6
    %
    
    
    5.8
    %
    
    
    1.3
    %
   31




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##### Table of Contents



Discontinued Operations
 GSM Business
   APS Germany
  APS France
  Recently Adopted Accounting Pronouncements
  Business combinations and non-controlling interests
  Fair Value Measurements
  32




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##### Table of Contents



Accounting for Convertible Debt Instruments That May be Settled in Cash upon Conversion
(Including Partial Cash Settlement)
  Determining Whether an Instrument (or an Embedded Feature) is Indexed to an Entitys Own Stock
  Liquidity and Capital Resources
 Liquidity
  July 2,
    
    
    September 30,2010
    
    
    2009(In millions)Cash and cash equivalents
    
    $
    449.2
    
    
    $
    535.5Short-term available-for-sale securitiesCorporate commercial paper, CDs and bonds
    
    
    133.0
    
    
    
    Government bonds
    
    
    36.6
    
    
    
    Auction rate securities
    
    
    11.4
    
    
    
    Total short-term available-for-sale securities
    
    
    181.0
    
    
    
    Long-term available-for-sale securitiesCorporate commercial paper, CDs and bonds
    
    
    41.5
    
    
    
    51.1Government bonds
    
    
    43.8
    
    
    
    Auction rate securities
    
    
    
    
    
    
    24.3Total long-term available-for-sale securities
    
    
    85.3
    
    
    
    75.4Total
    
    $
    715.5
    
    
    $
    610.9
  33




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##### Table of Contents



Operating Activities
   Investing Activities
  34




---



##### Table of Contents



Financing Activities
  Credit Facility
     Off-Balance-Sheet Arrangements and Contractual Obligations
  Working Capital and Liquidity Outlook
  35




---



##### Table of Contents



Cautionary Statement Regarding Forward Looking Information
  
 ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  36




---



##### Table of Contents



ITEM 4. CONTROLS AND PROCEDURES
 Disclosure Controls and Procedures
  Changes in Internal Control over Financial Reporting
  
 PART II. OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
    37




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##### Table of Contents



ITEM 1A. RISK FACTORS
  If our merger transaction with Tyco Electronics Ltd. is not completed or is delayed, our share
price, business and results of operations may materially suffer.
  
    
    a loss of revenue and market position that we may not be able to regain if the proposed
transactions are not consummated;
 
    
    damage to our relationships with our customers, suppliers, and other business partners;
 
    
    a potential obligation to pay a $38.0 million termination fee depending on the reasons
for terminating the merger transaction;
 
    
    significant costs related to the proposed transaction, including substantial legal,
accounting and investment banking expenses;
 
    
    key employees may be lost during the pendency of the merger and our relationships with
employees may be damaged; and
 
    
    business and organizational opportunities may be lost due to covenants in the merger
agreement that restrict certain actions by us prior to completion of the merger.
 
 ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  
 ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  
 ITEM 4. (REMOVED AND RESERVED)
 
 ITEM 5. OTHER INFORMATION
  
 ITEM 6. EXHIBITS
  38




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##### Table of Contents



SIGNATURES
  Dated: August 5, 2010
    ADC TELECOMMUNICATIONS, INC.By:
    /s/ James G. MathewsJames G. MathewsVice President, Chief Financial Officer

(Principal Financial Officer and Duly Authorized Officer) 39




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##### Table of Contents



ADC TELECOMMUNICATIONS, INC.
 
 EXHIBIT INDEX TO FORM 10-Q

FOR THE THREE MONTHS ENDED JULY 2, 2010
 ExhibitNo.
    
    Description2.1
    
    Agreement and Plan of Merger dated July 12, 2010 among ADC Telecommunications, Inc.,
Tyco Electronics Ltd. and Tyco Electronics Minnesota, Inc. (Incorporated by reference
to Exhibit 2.1 to ADCs Form 8-K filed on July 13, 2010.)2.2
    
    Amendment No. 1 to the Agreement and Plan of Merger between ADC Telecommunications,
Inc., Tyco Electronics Ltd. and Tyco Electronics Minnesota, Inc. dated as of July 24,
2010. (Incorporated by reference to Exhibit 2.1 to ADCs Current Report on Form 8-K
filed on July 26, 2010.)3.1
    
    Restated Articles of Incorporation of ADC Telecommunications, Inc., conformed to
incorporate amendments dated January 20, 2000, June 30, 2000, August 13, 2001, March
2, 2004 and May 9, 2005. (Incorporated by reference to Exhibit 3-a to ADCs Quarterly
Report on Form 10-Q for the quarter ended July 29, 2005.)3.2
    
    Restated Bylaws of ADC Telecommunications, Inc. effective December 9, 2008.
(Incorporated by reference to Exhibit 3.1 to ADCs Current Report on Form 8-K filed
on December 12, 2008.)4.1
    
    Form of certificate for shares of Common Stock of ADC Telecommunications, Inc.
(Incorporated by reference to Exhibit 4-a to ADCs Quarterly Report on Form 10-Q for
the quarter ended July 29, 2005.)4.2
    
    Rights Agreement, as amended and restated as of May 9, 2007, between ADC
Telecommunications, Inc. and Computershare Investor Services, LLC, as Rights Agent
(which includes as Exhibit A, the Form of Certificate of Designation, Preferences and
Right of Series A Junior Participating Preferred Stock, as Exhibit B, the Form of
Right Certificate, and as Exhibit C, the Summary of Rights to Purchase Preferred
Shares). (Incorporated by reference to Exhibit 4-b to ADCs Form 8-A/A filed on May
11, 2007.)31.1
    
    Certification of principal executive officer required by Exchange Act Rule 13a-14(a).*31.2
    
    Certification of principal financial officer required by Exchange Act Rule 13a-14(a).*32
    
    Certifications furnished pursuant to 18 U.S.C. 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.*
 
 *
    
    Filed herewith 40