In-process research and development

[Table of Contents](#ica158fb683c247fdb170955b492f9216_7)HEWLETT PACKARD ENTERPRISE COMPANY AND SUBSIDIARIESNotes to Consolidated Financial Statements (Continued)As of October 31, 2021, future unconditional purchase obligations were as follows:

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
| Fiscal Year | In millions |
| 2022 | $ | 458  |  |
| 2023 | 175  |  |
| 2024 | 53  |  |
| 2025 | 50  |  |
| 2026 | 9  |  |
| Thereafter | 23  |  |
| Total | $ | 768  |  |

Note 20: Equity Method InvestmentsThe Company includes investments which are accounted for using the equity method, under Investments in equity interests on the Company's Consolidated Balance Sheets. As of October 31, 2021 and October 31, 2020, the Company's Investments in equity interests were $2.2 billion and primarily related to a 49% equity interest in H3C Technologies ("H3C").In the periods presented, the Company recorded its interest in the net earnings of H3C along with an adjustment to eliminate unrealized profits on intra-entity sales, and the amortization of basis difference, within Earnings from equity interests in the Consolidated Statements of Earnings.The difference between the sale date carrying value of the Company's investment in H3C and its proportionate share of the net assets fair value of H3C, created a basis difference of $2.5 billion, which was allocated as follows:

|  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |
|  | In millions |
| Equity method goodwill | $ | 1,674  |  |
| Intangible assets | 749  |  |
| In-process research and development | 188  |  |
| Deferred tax liabilities | (152) |  |
| Other | 75  |  |
| Basis difference | $ | 2,534  |  |

The Company amortizes the basis difference over the estimated useful lives of the assets that gave rise to this difference. The weighted-average life of the H3C intangible assets is five years and is being amortized using the straight-line method. As of October 31, 2021 and 2020, the Company determined that no impairment of its equity method investments existed.Earnings from equity interestThe Company recorded earnings from equity interests of $180 million, $67 million and $20 million in fiscal 2021, 2020 and 2019, respectively, in the Consolidated Statements of Earnings, the components of which are as follows:

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|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | For the fiscal years ended October 31, |
|  | 2021 |  | 2020 |  | 2019 |
|  | In millions |
| Earnings from equity interests, net of taxes(1) | $ | 292  |  |  | $ | 211  |  |  | $ | 167  |  |
| Basis difference amortization | (109) |  |  | (145) |  |  | (152) |  |
| Elimination of profit on intra-entity sales adjustment | (3) |  |  | 1  |  |  | 5  |  |
| Earnings from equity interests | $ | 180  |  |  | $ | 67  |  |  | $ | 20  |  |



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(1) In fiscal 2021, earnings from equity interests, net of taxes included $260 million from H3C and $32 million from other venture investments.130
