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• | Persuasive evidence of an arrangement exists. The Company generally relies upon sales contracts or agreements, and customer purchase orders to determine the existence of an arrangement. |
• | Delivery has occurred. The Company uses shipping terms and related documents, or written evidence of customer acceptance, when applicable, to verify delivery or performance. |
• | Sales price is fixed or determinable. The Company assesses whether the sales price is fixed or determinable based on the payment terms and whether the sales price is subject to refund or adjustment. |
• | Collectability is reasonably assured. The Company assesses collectability based on creditworthiness of customers as determined by our credit checks and their payment histories. The Company records accounts receivable net of allowance for doubtful accounts, estimated customer returns, and pricing credits. |
|
As of December 31, | |||||||
2011 | 2010 | ||||||
Cash: | |||||||
Demand deposits | $ | 633.7 | $ | 413.0 | |||
Time deposits | 926.0 | 273.3 | |||||
Total cash | 1,559.7 | 686.3 | |||||
Cash equivalents: | |||||||
U.S. government securities | — | 76.7 | |||||
Government-sponsored enterprise obligations | 24.5 | 5.0 | |||||
Commercial paper | 10.0 | 4.0 | |||||
Money market funds | 1,316.2 | 1,039.9 | |||||
Total cash equivalents | 1,350.7 | 1,125.6 | |||||
Total cash and cash equivalents | $ | 2,910.4 | $ | 1,811.9 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
As of December 31, 2011: | |||||||||||||||
Fixed income securities: | |||||||||||||||
U.S. government securities | $ | 301.1 | $ | — | $ | (0.1 | ) | $ | 301.0 | ||||||
Government-sponsored enterprise obligations | 406.3 | 0.3 | (0.1 | ) | 406.5 | ||||||||||
Foreign government debt securities | — | — | — | — | |||||||||||
Certificates of deposit | 31.8 | — | — | 31.8 | |||||||||||
Asset-backed securities | 124.7 | 0.1 | (0.1 | ) | 124.7 | ||||||||||
Corporate debt securities | 508.2 | 1.0 | (0.5 | ) | 508.7 | ||||||||||
Total fixed income securities | 1,372.1 | 1.4 | (0.8 | ) | 1,372.7 | ||||||||||
Total available-for-sale securities | 1,372.1 | 1.4 | (0.8 | ) | 1,372.7 | ||||||||||
Trading securities: | |||||||||||||||
Mutual funds (1) | 9.3 | — | — | 9.3 | |||||||||||
Total trading securities | 9.3 | — | — | 9.3 | |||||||||||
Total | $ | 1,381.4 | $ | 1.4 | $ | (0.8 | ) | $ | 1,382.0 | ||||||
Reported as: | |||||||||||||||
Short-term investments | $ | 640.9 | $ | 0.4 | $ | — | $ | 641.3 | |||||||
Long-term investments | 740.5 | 1.0 | (0.8 | ) | 740.7 | ||||||||||
Total | $ | 1,381.4 | $ | 1.4 | $ | (0.8 | ) | $ | 1,382.0 |
(1) | Balance includes the Company's non-qualified deferred compensation plan assets. For additional information, see Note 12, Employee Benefits Plans, under the section Deferred Compensation Plan. |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
As of December 31, 2010: | |||||||||||||||
Fixed income securities: | |||||||||||||||
U.S. government securities | $ | 158.2 | $ | 0.2 | $ | — | $ | 158.4 | |||||||
Government-sponsored enterprise obligations | 213.8 | 0.4 | (0.2 | ) | 214.0 | ||||||||||
Foreign government debt securities | 46.8 | 0.2 | — | 47.0 | |||||||||||
Certificates of deposit | 20.9 | 0.1 | — | 21.0 | |||||||||||
Commercial paper | 9.5 | — | — | 9.5 | |||||||||||
Asset-backed securities | 90.1 | — | (0.1 | ) | 90.0 | ||||||||||
Corporate debt securities | 459.7 | 2.2 | (0.2 | ) | 461.7 | ||||||||||
Total fixed income securities | 999.0 | 3.1 | (0.5 | ) | 1,001.6 | ||||||||||
Total available-for-sale securities | 999.0 | 3.1 | (0.5 | ) | 1,001.6 | ||||||||||
Trading securities: | |||||||||||||||
Mutual funds (1) | 8.1 | — | — | 8.1 | |||||||||||
Total trading securities | 8.1 | — | — | 8.1 | |||||||||||
Total | $ | 1,007.1 | $ | 3.1 | $ | (0.5 | ) | $ | 1,009.7 | ||||||
Reported as: | |||||||||||||||
Short-term investments | $ | 473.6 | $ | 0.9 | $ | — | $ | 474.5 | |||||||
Long-term investments | 533.5 | 2.2 | (0.5 | ) | 535.2 | ||||||||||
Total | $ | 1,007.1 | $ | 3.1 | $ | (0.5 | ) | $ | 1,009.7 |
(1) | Balance includes the Company's non-qualified deferred compensation plan assets. For additional information, see Note 12, Employee Benefits Plans, under the section Deferred Compensation Plan. |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
Due within one year | $ | 631.6 | $ | 0.4 | $ | — | $ | 632.0 | |||||||
Due between one and five years | 740.5 | 1.0 | (0.8 | ) | 740.7 | ||||||||||
Total | $ | 1,372.1 | $ | 1.4 | $ | (0.8 | ) | $ | 1,372.7 |
Less than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||
As of December 31, 2011 | |||||||||||||||||||||||
Corporate debt securities | $ | 189.9 | $ | (0.5 | ) | $ | — | $ | — | $ | 189.9 | $ | (0.5 | ) | |||||||||
U.S. government securities | 186.7 | (0.1 | ) | — | — | 186.7 | (0.1 | ) | |||||||||||||||
Government-sponsored enterprise obligations | 146.0 | (0.1 | ) | — | — | 146.0 | (0.1 | ) | |||||||||||||||
Asset-backed securities | 76.8 | (0.1 | ) | 0.3 | * | — | 77.1 | * | (0.1 | ) | |||||||||||||
Total | $ | 599.4 | $ | (0.8 | ) | $ | 0.3 | $ | — | $ | 599.7 | $ | (0.8 | ) |
Less than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||
As of December 31, 2010 | |||||||||||||||||||||||
Corporate debt securities | $ | 104.3 | $ | (0.2 | ) | $ | 28.8 | * | $ | — | $ | 133.1 | * | $ | (0.2 | ) | |||||||
Government-sponsored enterprise obligations | 57.8 | (0.2 | ) | — | — | 57.8 | (0.2 | ) | |||||||||||||||
Foreign government debt securities | — | — | 6.2 | * | — | 6.2 | * | — | |||||||||||||||
Commercial paper | 5.0 | * | — | — | — | 5.0 | * | — | |||||||||||||||
Asset-backed securities | 54.7 | (0.1 | ) | — | — | 54.7 | (0.1 | ) | |||||||||||||||
Total | $ | 221.8 | $ | (0.5 | ) | $ | 35.0 | $ | — | $ | 256.8 | $ | (0.5 | ) |
As of December 31, | |||||||
2011 | 2010 | ||||||
Restricted cash: | |||||||
Demand deposits | $ | 0.6 | $ | 1.7 | |||
Total restricted cash | 0.6 | 1.7 | |||||
Restricted investments: | |||||||
U.S. government securities | — | 0.6 | |||||
Corporate debt securities | 1.6 | 2.7 | |||||
Mutual funds | 1.0 | — | |||||
Money market funds | 75.1 | 114.3 | |||||
Total restricted investments | 77.7 | 117.6 | |||||
Total restricted cash and investments | $ | 78.3 | $ | 119.3 |
|
Fair Value Measurements at December 31, 2011 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Assets measured at fair value: | |||||||||||||||
Available-for-sale debt securities: | |||||||||||||||
U.S. government securities | $ | 149.3 | $ | 151.7 | $ | — | $ | 301.0 | |||||||
Government-sponsored enterprise obligations | 314.2 | 116.8 | — | 431.0 | |||||||||||
Commercial paper | — | 10.0 | — | 10.0 | |||||||||||
Corporate debt securities (1) | — | 510.3 | — | 510.3 | |||||||||||
Certificate of deposit | — | 31.8 | — | 31.8 | |||||||||||
Asset-backed securities | — | 124.7 | — | 124.7 | |||||||||||
Money market funds (2) | 1,391.3 | — | — | 1,391.3 | |||||||||||
Total available-for-sale debt securities | 1,854.8 | 945.3 | — | 2,800.1 | |||||||||||
Total available-for-sale securities | 1,854.8 | 945.3 | — | 2,800.1 | |||||||||||
Trading securities: | |||||||||||||||
Mutual funds (3) | 10.3 | — | — | 10.3 | |||||||||||
Total trading securities | 10.3 | — | — | 10.3 | |||||||||||
Derivative assets: | |||||||||||||||
Foreign exchange contracts | — | 0.4 | — | 0.4 | |||||||||||
Total derivative assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,865.1 | $ | 945.7 | $ | — | $ | 2,810.8 | |||||||
Liabilities measured at fair value: | |||||||||||||||
Derivative liabilities: | |||||||||||||||
Foreign exchange contracts | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) | |||||
Total derivative liabilities | — | (9.6 | ) | — | (9.6 | ) | |||||||||
Total liabilities measured at fair value | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) |
(1) | Balance includes $1.6 million of restricted investments measured at fair market value, related to the Company's India Gratuity Trust. |
(2) | Balance includes $75.1 million of restricted investments measured at fair market value, related to the Company's D&O trust and acquisition related escrows. |
(3) | Balance includes $9.3 million of the Company's non-qualified deferred compensation plan assets and $1.0 million of restricted investments measured at fair market value, related to the Company's India Gratuity Trust. |
Fair Value Measurements at December 31, 2011 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Total assets measured at fair value, reported as: | |||||||||||||||
Cash equivalents | $ | 1,316.2 | $ | 34.5 | $ | — | $ | 1,350.7 | |||||||
Short-term investments | 168.9 | 472.4 | — | 641.3 | |||||||||||
Long-term investments | 303.9 | 436.8 | — | 740.7 | |||||||||||
Restricted cash and investments | 76.1 | 1.6 | — | 77.7 | |||||||||||
Prepaid expenses and other current assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,865.1 | $ | 945.7 | $ | — | $ | 2,810.8 | |||||||
Total liabilities measured at fair value, reported as: | |||||||||||||||
Other accrued liabilities | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) | |||||
Total liabilities measured at fair value | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) |
Fair Value Measurements at December 31, 2010 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Assets measured at fair value: | |||||||||||||||
Available-for-sale debt securities: | |||||||||||||||
U.S. government securities (1) | $ | 54.9 | $ | 180.8 | $ | — | $ | 235.7 | |||||||
Government-sponsored enterprise obligations | 208.9 | 10.1 | — | 219.0 | |||||||||||
Foreign government debt securities | 21.0 | 26.0 | — | 47.0 | |||||||||||
Commercial paper | — | 13.5 | — | 13.5 | |||||||||||
Corporate debt securities (2) | 2.7 | 461.7 | — | 464.4 | |||||||||||
Certificate of deposit | — | 21.0 | — | 21.0 | |||||||||||
Asset-backed securities | — | 90.0 | — | 90.0 | |||||||||||
Money market funds (3) | 1,154.2 | — | — | 1,154.2 | |||||||||||
Total available-for-sale debt securities | 1,441.7 | 803.1 | — | 2,244.8 | |||||||||||
Total available-for-sale securities | 1,441.7 | 803.1 | — | 2,244.8 | |||||||||||
Trading securities: | |||||||||||||||
Mutual funds | 8.1 | — | — | 8.1 | |||||||||||
Total trading securities | 8.1 | — | — | 8.1 | |||||||||||
Derivative assets: | |||||||||||||||
Foreign exchange contracts | — | 0.4 | — | 0.4 | |||||||||||
Total derivative assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,449.8 | $ | 803.5 | $ | — | $ | 2,253.3 | |||||||
Liabilities measured at fair value: | |||||||||||||||
Derivative liabilities: | |||||||||||||||
Foreign exchange contracts | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) | |||||
Total derivative liabilities | — | (2.6 | ) | — | (2.6 | ) | |||||||||
Total liabilities measured at fair value | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) |
(1) | Balance includes $0.6 million of restricted investments measured at fair market value, related to an acquisition completed in 2005. For additional information regarding the Company's restricted investments, see Note 4, Cash, Cash Equivalents, and Investments, under the heading “Restricted Cash and Investments.” Restricted investments are included in the restricted cash balance in the consolidated balance sheet. |
(2) | Balance includes $2.7 million of restricted investments measured at fair market value, related to the Company's India Gratuity Trust. |
(3) | Balance includes $114.3 million of restricted investments measured at fair market value, related to the Company's D&O trust and acquisition related escrows. |
Fair Value Measurements at December 31, 2010 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Total assets measured at fair value, reported as: | |||||||||||||||
Cash equivalents | $ | 1,039.9 | $ | 85.7 | $ | — | $ | 1,125.6 | |||||||
Short-term investments | 150.7 | 323.8 | — | 474.5 | |||||||||||
Long-term investments | 142.2 | 393.0 | — | 535.2 | |||||||||||
Restricted cash | 117.0 | 0.6 | — | 117.6 | |||||||||||
Prepaid expenses and other current assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,449.8 | $ | 803.5 | $ | — | $ | 2,253.3 | |||||||
Total liabilities measured at fair value, reported as: | |||||||||||||||
Other accrued liabilities | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) | |||||
Total liabilities measured at fair value | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) |
|
As of December 31, | |||||||
2011 | 2010 | ||||||
Cash flow hedges | $ | 184.3 | $ | 110.4 | |||
Non-designated hedges | 122.7 | 74.4 | |||||
Total | $ | 307.0 | $ | 184.8 |
|
Allocation of purchase consideration: | 2011 Acquisitions | 2010 Acquisitions | |||||
Net tangible assets acquired | $ | 1.7 | $ | 8.8 | |||
Intangible assets acquired | 28.4 | 116.5 | |||||
Goodwill | 0.4 | 269.2 | |||||
Total | $ | 30.5 | $ | 394.5 |
Ankeena | SMobile | Altor | Trapeze | Total | |||||||||||||||
Net cash | $ | 66.5 | $ | 69.5 | $ | 104.0 | $ | 152.1 | $ | 392.1 | |||||||||
Assumed stock option and RSU awards allocated to purchase price (1) | 2.4 | — | — | — | 2.4 | ||||||||||||||
Total | $ | 68.9 | $ | 69.5 | $ | 104.0 | $ | 152.1 | $ | 394.5 |
(1) | The fair value of the stock option and RSU awards assumed was based on the acquired company's determined value on the acquisition date. |
2011 Acquisitions | ||||
Estimated Useful Life (In Years) | Amount | |||
Existing or Core technology | 10 | $ | 21.9 | |
Support agreements and related relationships | 4 | 5.1 | ||
Patents | 5 | 1.4 | ||
Total | $ | 28.4 |
2010 Acquisitions | |||||||||||||||||||||||||||||||
Ankeena | SMobile | Altor | Trapeze | ||||||||||||||||||||||||||||
Estimated Useful Life (In Years) | Amount | Estimated Useful Life (In Years) | Amount | Estimated Useful Life (In Years) | Amount | Estimated Useful Life (In Years) | Amount | Total Amount | |||||||||||||||||||||||
Existing technology | 4.0 | $ | 9.0 | 5.0 | $ | 24.3 | 6.0 | $ | 13.9 | 5.0 | $ | 45.0 | $ | 92.2 | |||||||||||||||||
In-process research and development | — | — | — | — | — | 2.8 | — | — | 2.8 | ||||||||||||||||||||||
Core technology | 4.0 | 3.2 | — | — | 6.0 | 4.6 | — | — | 7.8 | ||||||||||||||||||||||
Customer contracts and related relationships | — | — | 6.0 | 2.1 | — | — | 7.0 | 8.6 | 10.7 | ||||||||||||||||||||||
Support agreements and related relationships | — | — | 6.0 | 0.1 | — | — | 7.0 | 2.6 | 2.7 | ||||||||||||||||||||||
Non-compete agreements | — | — | 2.0 | 0.1 | — | — | — | — | 0.1 | ||||||||||||||||||||||
OEM customer contracts | — | — | — | — | — | — | 2.0 | 0.2 | 0.2 | ||||||||||||||||||||||
Total | $ | 12.2 | $ | 26.6 | $ | 21.3 | $ | 56.4 | $ | 116.5 |
|
Infrastructure | SLT | Total | |||||||||
December 31, 2009 | $ | 1,500.5 | $ | 2,158.1 | $ | 3,658.6 | |||||
Adjustment to goodwill | — | 0.2 | 0.2 | ||||||||
Additions due to business combinations | 142.9 | 126.1 | 269.0 | ||||||||
December 31, 2010 | 1,643.4 | 2,284.4 | 3,927.8 | ||||||||
Adjustments to goodwill | 1.7 | (1.8 | ) | (0.1 | ) | ||||||
Additions due to business combinations | 0.4 | — | 0.4 | ||||||||
December 31, 2011 | $ | 1,645.5 | $ | 2,282.6 | $ | 3,928.1 |
Gross | Accumulated Amortization | Net | |||||||||
As of December 31, 2011: | |||||||||||
Intangible assets with finite lives: | |||||||||||
Technologies and patents | $ | 499.5 | $ | (404.2 | ) | $ | 95.3 | ||||
Other | 91.5 | (66.5 | ) | 25.0 | |||||||
Total intangible assets with finite lives | 591.0 | (470.7 | ) | 120.3 | |||||||
IPR&D with indefinite lives | 2.8 | — | 2.8 | ||||||||
Total purchased intangible assets | $ | 593.8 | $ | (470.7 | ) | $ | 123.1 | ||||
As of December 31, 2010: | |||||||||||
Intangible assets with finite lives: | |||||||||||
Technologies and patents | $ | 471.1 | $ | (381.4 | ) | $ | 89.7 | ||||
Other | 86.4 | (62.2 | ) | 24.2 | |||||||
Total intangible assets with finite lives | 557.5 | (443.6 | ) | 113.9 | |||||||
IPR&D with indefinite lives | 7.9 | — | 7.9 | ||||||||
Total purchased intangible assets | $ | 565.4 | $ | (443.6 | ) | $ | 121.8 |
Years Ending December 31, | Amount | |||
2012 | $ | 27.4 | ||
2013 | 27.2 | |||
2014 | 25.3 | |||
2015 | 20.4 | |||
2016 | 7.7 | |||
Thereafter | 12.3 | |||
Total | $ | 120.3 |
|
As of December 31, | |||||||
2011 | 2010 | ||||||
Inventories, net | |||||||
Production materials | $ | 52.4 | $ | 5.8 | |||
Finished goods | 16.7 | 15.8 | |||||
Total inventories, net | $ | 69.1 | $ | 21.6 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Computers and equipment | $ | 604.6 | $ | 514.3 | |||
Software | 110.2 | 101.6 | |||||
Leasehold improvements | 204.1 | 179.0 | |||||
Furniture and fixtures | 27.4 | 24.9 | |||||
Building and building improvements | 6.2 | — | |||||
Land and land improvements | 208.2 | 203.7 | |||||
Construction-in-process | 99.7 | 41.9 | |||||
Property and equipment, gross | 1,260.4 | 1,065.4 | |||||
Accumulated depreciation | (661.8 | ) | (571.5 | ) | |||
Property and equipment, net | $ | 598.6 | $ | 493.9 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Deferred product revenue: | |||||||
Undelivered product commitments and other product deferrals | $ | 288.1 | $ | 294.1 | |||
Distributor inventory and other sell-through items | 134.0 | 143.4 | |||||
Deferred gross product revenue | 422.1 | 437.5 | |||||
Deferred cost of product revenue | (136.9 | ) | (148.8 | ) | |||
Deferred product revenue, net | 285.2 | 288.7 | |||||
Deferred service revenue | 681.8 | 595.7 | |||||
Total | $ | 967.0 | $ | 884.4 | |||
Reported as: | |||||||
Current | $ | 712.6 | $ | 660.2 | |||
Long-term | 254.4 | 224.2 | |||||
Total deferred revenue | $ | 967.0 | $ | 884.4 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Beginning balance | $ | 35.9 | $ | 38.2 | |||
Provisions made during the period, net | 52.5 | 49.9 | |||||
Change in estimate | (12.6 | ) | (3.0 | ) | |||
Actual costs incurred during the period | (47.5 | ) | (49.2 | ) | |||
Ending balance | $ | 28.3 | $ | 35.9 |
Remaining Liability as of December 31, 2010 | Charges | Cash payments | Non-cash Settlements and Other Adjustments | Remaining Liability as of December 31, 2011 | |||||||||||||||
Facilities | $ | 7.7 | $ | 0.2 | $ | (5.3 | ) | $ | (1.6 | ) | $ | 1.0 | |||||||
Severance, contractual commitments, and other charges | 0.2 | 16.9 | (13.3 | ) | (0.7 | ) | 3.1 | ||||||||||||
Total | $ | 7.9 | $ | 17.1 | $ | (18.6 | ) | $ | (2.3 | ) | $ | 4.1 |
Remaining Liability as of December 31, 2009 | Charges | Cash payments | Non-cash Settlements and Other Adjustments | Remaining Liability as of December 31, 2010 | |||||||||||||||
Facilities | $ | 4.9 | $ | 6.9 | $ | (2.5 | ) | $ | (1.6 | ) | $ | 7.7 | |||||||
Severance, contractual commitments, and other charges | 4.5 | 3.9 | (5.5 | ) | (2.7 | ) | 0.2 | ||||||||||||
Total | $ | 9.4 | $ | 10.8 | $ | (8.0 | ) | $ | (4.3 | ) | $ | 7.9 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Interest income | $ | 9.7 | $ | 10.5 | $ | 11.8 | |||||
Interest expense | (49.5 | ) | (8.7 | ) | (6.0 | ) | |||||
Other income and expense, net | (7.0 | ) | 8.8 | (4.6 | ) | ||||||
Other (expense) income, net | $ | (46.8 | ) | $ | 10.6 | $ | 1.4 |
|
As of | ||||||
December 31, 2011 | ||||||
Amount | Effective Interest Rate | |||||
3.10% fixed-rate Notes, due 2016 | $ | 300.0 | 3.12 | % | ||
4.60% fixed-rate Notes, due 2021 | 300.0 | 4.63 | % | |||
5.95% fixed-rate Notes, due 2041 | 400.0 | 6.01 | % | |||
Total Notes | 1,000.0 | |||||
Unaccreted discount | (1.0 | ) | ||||
Total long-term debt | $ | 999.0 |
|
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Consolidated net income | $ | 425.0 | $ | 619.4 | $ | 115.2 | |||||
Other comprehensive income (loss), net: | |||||||||||
Change in unrealized gain (loss) on investments, net | (9.9 | ) | (0.3 | ) | (2.8 | ) | |||||
Change in foreign currency translation adjustment, net | (6.4 | ) | 0.5 | 5.6 | |||||||
Total other comprehensive income (loss), net | (16.3 | ) | 0.2 | 2.8 | |||||||
Consolidated comprehensive income | 408.7 | 619.6 | 118.0 | ||||||||
Adjust for comprehensive loss (income) attributable to noncontrolling interest, net | 0.1 | (1.0 | ) | 1.8 | |||||||
Comprehensive income attributable to Juniper Networks | $ | 408.8 | $ | 618.6 | $ | 119.8 |
|
Outstanding Options | |||||||||||||
Number of Shares | Weighted Average Exercise Price per Share | Weighted Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value | ||||||||||
Balance at December 31, 2008 | 73.6 | $ | 21.24 | ||||||||||
Options granted | 9.9 | 17.86 | |||||||||||
Options canceled | (2.3 | ) | 21.57 | ||||||||||
Options exercised | (8.6 | ) | 14.59 | ||||||||||
Options expired | (5.2 | ) | 34.91 | ||||||||||
Balance at December 31, 2009 | 67.4 | 20.84 | 4.6 | $ | 451.2 | ||||||||
Options granted | 6.2 | 29.15 | |||||||||||
Options assumed (1) | 0.5 | 31.65 | |||||||||||
Options canceled | (2.3 | ) | 22.03 | ||||||||||
Options exercised | (21.6 | ) | 18.99 | ||||||||||
Options expired | (0.8 | ) | 61.48 | ||||||||||
Balance at December 31, 2010 | 49.4 | 21.90 | 4.1 | $ | 744.5 | ||||||||
Options granted | 5.6 | 37.17 | |||||||||||
Options canceled | (1.9 | ) | 26.76 | ||||||||||
Options exercised | (13.9 | ) | 21.13 | ||||||||||
Options expired | (0.6 | ) | 34.32 | ||||||||||
Balance at December 31, 2011 | 38.6 | $ | 23.98 | 3.7 | $ | 75.3 | |||||||
As of December 31, 2011: | |||||||||||||
Vested or expected-to-vest options | 36.9 | $ | 23.66 | 3.7 | $ | 74.2 | |||||||
Exercisable options | 26.1 | $ | 21.51 | 3.0 | $ | 61.7 |
(1) | Stock options assumed in connection with the acquisition of Ankeena and Altor. |
Options Outstanding | Options Exercisable | ||||||||||||||||
Range of Exercise Price | Number Outstanding | Weighted-Average Remaining Contractual Life | Weighted-Average Exercise Price | Number Exercisable | Weighted-Average Exercise Price | ||||||||||||
(In millions) | (In years) | (In dollars) | (In millions) | (In dollars) | |||||||||||||
$0.33 - $14.91 | 4.3 | 2.2 | $ | 10.84 | 3.7 | $ | 10.45 | ||||||||||
$15.00 - $15.09 | 4.0 | 3.5 | 15.07 | 2.7 | 15.06 | ||||||||||||
$15.32 - $18.96 | 4.4 | 2.5 | 17.69 | 3.9 | 17.78 | ||||||||||||
$19.45 - $22.74 | 4.0 | 3.8 | 21.27 | 2.7 | 21.36 | ||||||||||||
$22.97 - $25.16 | 5.7 | 3.1 | 24.47 | 5.3 | 24.44 | ||||||||||||
$25.19 - $26.90 | 4.6 | 3.9 | 26.33 | 3.2 | 26.35 | ||||||||||||
$26.97 - $29.89 | 4.9 | 4.8 | 28.58 | 2.5 | 28.46 | ||||||||||||
$29.93 - $38.93 | 3.2 | 4.3 | 33.35 | 2.1 | 32.77 | ||||||||||||
$40.26 - $44.00 | 3.5 | 6.2 | 41.87 | — | — | ||||||||||||
38.6 | 3.7 | $ | 23.98 | 26.1 | $ | 21.51 |
Outstanding RSUs and PSAs | |||||||||||||
Number of Shares | Weighted Average Grant-Date Fair Value per Share | Weighted Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value | ||||||||||
Balance at January 1, 2009 | 6.7 | $ | 24.59 | ||||||||||
RSUs granted | 1.8 | $ | 17.87 | ||||||||||
PSAs granted | 2.9 | $ | 18.05 | ||||||||||
RSUs vested | (1.3 | ) | $ | 21.05 | |||||||||
PSAs vested | (0.1 | ) | $ | 26.90 | |||||||||
RSUs canceled | (0.7 | ) | $ | 24.67 | |||||||||
PSAs canceled | (0.2 | ) | $ | 19.12 | |||||||||
Balance at December 31, 2009 | 9.1 | $ | 21.76 | 1.6 | $ | 243.3 | |||||||
RSUs granted | 4.0 | $ | 30.19 | ||||||||||
RSUs assumed (1) | 0.5 | $ | 32.09 | ||||||||||
PSAs granted | 3.8 | $ | 29.25 | ||||||||||
RSUs vested | (1.8 | ) | $ | 25.30 | |||||||||
PSAs vested | (0.4 | ) | $ | 20.64 | |||||||||
RSUs canceled | (0.6 | ) | $ | 24.87 | |||||||||
PSAs canceled | (0.4 | ) | $ | 22.57 | |||||||||
Balance at December 31, 2010 | 14.2 | $ | 25.94 | 1.7 | $ | 522.9 | |||||||
RSUs granted | 7.3 | $ | 31.75 | ||||||||||
PSAs granted (2) | 4.5 | $ | 38.64 | ||||||||||
RSUs vested | (1.7 | ) | $ | 23.26 | |||||||||
PSAs vested | (0.8 | ) | $ | 24.76 | |||||||||
RSUs canceled | (1.0 | ) | $ | 31.57 | |||||||||
PSAs canceled | (2.9 | ) | $ | 30.72 | |||||||||
Balance at December 31, 2011 | 19.6 | $ | 30.27 | 1.5 | $ | 400.5 | |||||||
As of December 31, 2011: | |||||||||||||
Vested and expected-to-vest RSUs and PSAs | 16.7 | $ | 29.97 | 1.3 | $ | 341.0 |
(1) | RSUs assumed in connection with the acquisitions of Ankeena and Altor. |
(2) | The number of shares subject to PSAs granted represents the aggregate maximum number of shares that may be issued pursuant to the award over its full term. The aggregate number of shares subject to these PSAs that would be issued if performance goals determined by the Compensation Committee are achieved is estimated at 1.9 million shares. Depending on achievement of such performance goals, the range of shares that could be issued under these awards is 0 to 4.5 million shares. |
Number of Shares | ||
Balance at January 1, 2011 | 30.7 | |
Additional authorized share reserve approved by stockholders | 30.0 | |
RSUs and PSAs granted (1) | (24.6 | ) |
Options granted | (5.6 | ) |
RSUs and PSAs canceled (1) | 8.1 | |
Options canceled (2) | 1.9 | |
Options expired (2) | 0.6 | |
Balance at December 31, 2011 | 41.1 |
(1) | RSUs and PSAs with a per share or unit purchase price lower than 100% of the fair market value of the Company's common stock on the day of the grant under the 2006 Plan are counted against shares authorized under the plan as two and one-tenth shares of common stock for each share subject to such award. The number of shares subject to PSAs granted represents the maximum number of shares that may be issued pursuant to the award over its full term. |
(2) | Includes canceled or expired options under the 1996 Plan and the 2000 Plan that expired unexercised after May 18, 2006, which become available for grant under the 2006 Plan according to its terms. |
Years Ended December 31, | |||||
2011 | 2010 | 2009 | |||
Employee Stock Options: | |||||
Volatility factor | 43% | 38% | 50% | ||
Risk-free interest rate | 1.5% | 2.0% | 1.6% | ||
Expected life (years) | 4.1 | 4.3 | 4.2 | ||
Dividend yield | — | — | — | ||
Weighted-average fair value per share | $13.17 | $9.77 | $7.41 | ||
Employee Stock Purchase Plan: | |||||
Volatility factor | 41% | 35% | 54% | ||
Risk-free interest rate | 0.2% | 0.2% | 0.4% | ||
Expected life (years) | 0.5 | 0.5 | 0.5 | ||
Dividend yield | — | — | — | ||
Weighted-average fair value per share | $7.48 | $6.55 | $5.54 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Cost of revenues - Product | $ | 4.6 | $ | 4.4 | $ | 3.9 | |||||
Cost of revenues - Service | 15.7 | 13.5 | 10.5 | ||||||||
Research and development | 97.7 | 78.5 | 59.3 | ||||||||
Sales and marketing | 70.9 | 54.9 | 43.1 | ||||||||
General and administrative | 33.3 | 30.7 | 22.9 | ||||||||
Total | $ | 222.2 | $ | 182.0 | $ | 139.7 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Options | $ | 76.2 | $ | 81.5 | $ | 81.2 | |||||
Assumed options | — | 0.8 | — | ||||||||
RSUs and PSAs | 123.1 | 81.8 | 44.1 | ||||||||
Assumed RSUs | — | 0.6 | — | ||||||||
Employee stock purchase plan | 18.5 | 13.1 | 14.4 | ||||||||
Other acquisition-related compensation | 4.4 | 4.2 | — | ||||||||
Total | $ | 222.2 | $ | 182.0 | $ | 139.7 |
|
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Net revenues: | |||||||||||
Infrastructure: | |||||||||||
Routers | $ | 2,894.4 | $ | 2,655.7 | $ | 2,244.2 | |||||
Switches | 528.2 | 394.6 | 197.4 | ||||||||
Total Infrastructure | 3,422.6 | 3,050.3 | 2,441.6 | ||||||||
SLT | 1,026.1 | 1,043.0 | 874.3 | ||||||||
Total net revenues | $ | 4,448.7 | $ | 4,093.3 | $ | 3,315.9 | |||||
Segment operating income: | |||||||||||
Infrastructure | $ | 718.3 | $ | 773.7 | $ | 541.4 | |||||
SLT | 199.0 | 208.0 | 127.0 | ||||||||
Total segment operating income | 917.3 | 981.7 | 668.4 | ||||||||
Amortization of purchased intangible assets (1) | (27.1 | ) | (8.6 | ) | (15.4 | ) | |||||
Share-based compensation expense | (222.2 | ) | (182.0 | ) | (139.7 | ) | |||||
Share-based payroll tax expense | (9.3 | ) | (6.4 | ) | (0.8 | ) | |||||
Restructuring and other charges | (30.6 | ) | (10.8 | ) | (19.5 | ) | |||||
Acquisition-related and other charges (2) | (9.6 | ) | (6.3 | ) | (182.3 | ) | |||||
Total operating income | 618.5 | 767.6 | 310.7 | ||||||||
Other (expense) income, net | (46.8 | ) | 10.6 | 1.4 | |||||||
Income before income taxes and noncontrolling interest | $ | 571.7 | $ | 778.2 | $ | 312.1 |
(1) | Amount includes amortization expense of purchased intangible assets in operating expenses and in cost of revenues. |
(2) | Amount includes acquisition-related costs in operating expenses and in cost of revenues. |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Americas: | |||||||||||
United States | $ | 2,015.8 | $ | 1,890.1 | $ | 1,515.1 | |||||
Other | 222.2 | 205.5 | 172.8 | ||||||||
Total Americas | 2,238.0 | 2,095.6 | 1,687.9 | ||||||||
Europe, Middle East, and Africa | 1,339.8 | 1,189.3 | 953.2 | ||||||||
Asia Pacific | 870.9 | 808.4 | 674.8 | ||||||||
Total | $ | 4,448.7 | $ | 4,093.3 | $ | 3,315.9 |
|
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Domestic | $ | 218.4 | $ | 370.6 | $ | 50.1 | |||||
Foreign | 353.3 | 407.6 | 262.0 | ||||||||
Total income before provision for income taxes and noncontrolling interest | $ | 571.7 | $ | 778.2 | $ | 312.1 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Current provision (benefit): | |||||||||||
Federal | $ | 19.5 | $ | (8.4 | ) | $ | 123.8 | ||||
State | 0.9 | 1.0 | 21.4 | ||||||||
Foreign | 47.8 | 44.2 | 43.5 | ||||||||
Total current provision | 68.2 | 36.8 | 188.7 | ||||||||
Deferred provision (benefit): | |||||||||||
Federal | 23.0 | 57.5 | (42.7 | ) | |||||||
State | 0.6 | 14.0 | 55.7 | ||||||||
Foreign | (3.6 | ) | (7.5 | ) | (5.9 | ) | |||||
Total deferred provision | 20.0 | 64.0 | 7.1 | ||||||||
Income tax benefits attributable to employee stock plan activity | 58.5 | 58.0 | 1.0 | ||||||||
Total provision for income taxes | $ | 146.7 | $ | 158.8 | $ | 196.8 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Expected provision at 35% rate | $ | 200.1 | $ | 272.4 | $ | 109.2 | |||||
State taxes, net of federal benefit | 2.0 | 6.2 | (1.6 | ) | |||||||
Foreign income at different tax rates | (50.4 | ) | (71.5 | ) | (33.8 | ) | |||||
R&D credits | (21.3 | ) | (18.6 | ) | (14.4 | ) | |||||
Stock-based compensation | 16.7 | (40.2 | ) | 62.1 | |||||||
Temporary differences not currently benefited | — | 10.2 | 72.8 | ||||||||
Other | (0.4 | ) | 0.3 | 2.5 | |||||||
Total provision for income taxes | $ | 146.7 | $ | 158.8 | $ | 196.8 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Deferred tax assets: | |||||||
Net operating loss carry-forwards | $ | 4.4 | $ | 14.1 | |||
Foreign tax credit carry-forwards | 48.7 | 40.3 | |||||
Research and other credit carry-forwards | 86.3 | 68.2 | |||||
Deferred revenue | 94.0 | 86.1 | |||||
Stock-based compensation | 91.2 | 75.6 | |||||
Reserves and accruals not currently deductible | 255.9 | 227.6 | |||||
Other | 31.0 | 26.8 | |||||
Total deferred tax assets | 611.5 | 538.7 | |||||
Valuation allowance | (145.2 | ) | (122.2 | ) | |||
Deferred tax assets, net of valuation allowance | 466.3 | 416.5 | |||||
Deferred tax liabilities: | |||||||
Property and equipment basis differences | (87.0 | ) | (47.1 | ) | |||
Purchased intangibles | (53.2 | ) | (58.5 | ) | |||
Unremitted foreign earnings | (210.5 | ) | (175.1 | ) | |||
Other | — | (0.1 | ) | ||||
Total deferred tax liabilities | (350.7 | ) | (280.8 | ) | |||
Net deferred tax assets | $ | 115.6 | $ | 135.7 |
As of December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Balance beginning of the year | $ | 116.4 | $ | 183.6 | $ | 113.5 | |||||
Tax positions related to current year: | |||||||||||
Additions | 17.6 | 13.9 | 12.7 | ||||||||
Tax positions related to prior years: | |||||||||||
Additions | 6.4 | — | 73.5 | ||||||||
Reductions | — | (73.8 | ) | (1.0 | ) | ||||||
Settlements | (5.4 | ) | (1.6 | ) | (12.8 | ) | |||||
Lapses in statutes of limitations | (2.8 | ) | (5.7 | ) | (2.3 | ) | |||||
Balance end of the year | $ | 132.2 | $ | 116.4 | $ | 183.6 |
|
Years Ending December 31, | |||||||||||||||||||||||||||||||
Total | 2012 | 2013 | 2014 | 2015 | 2016 | Thereafter | Other | ||||||||||||||||||||||||
Operating leases | $ | 352.7 | $ | 57.9 | $ | 50.8 | $ | 63.8 | $ | 53.4 | $ | 26.6 | $ | 100.2 | $ | — | |||||||||||||||
Purchase commitments | 150.6 | 150.6 | — | — | — | — | — | — | |||||||||||||||||||||||
Tax liabilities | 108.5 | — | — | — | — | — | — | 108.5 | |||||||||||||||||||||||
Long-term debt | 1,000.0 | — | — | — | — | 300.0 | 700.0 | — | |||||||||||||||||||||||
Interest payment on long-term debt | 873.1 | 46.9 | 46.9 | 46.9 | 46.9 | 41.9 | 643.6 | — | |||||||||||||||||||||||
Other contractual obligations | 73.1 | 63.3 | 4.8 | 3.0 | 2.0 | — | — | — | |||||||||||||||||||||||
Total | $ | 2,558.0 | $ | 318.7 | $ | 102.5 | $ | 113.7 | $ | 102.3 | $ | 368.5 | $ | 1,443.8 | $ | 108.5 |
|
Year Ended December 31, 2011 | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||
Net revenues: | |||||||||||||||
Product | $ | 877.4 | $ | 891.4 | $ | 861.9 | $ | 847.5 | |||||||
Service | 224.2 | 229.1 | 243.9 | 273.3 | |||||||||||
Total net revenues | 1,101.6 | 1,120.5 | 1,105.8 | 1,120.8 | |||||||||||
Cost of revenues: | |||||||||||||||
Product (2) | 265.7 | 292.4 | 286.6 | 310.6 | |||||||||||
Service | 100.0 | 105.9 | 107.6 | 111.3 | |||||||||||
Total cost of revenues | 365.7 | 398.3 | 394.2 | 421.9 | |||||||||||
Gross margin | 735.9 | 722.2 | 711.6 | 698.9 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 262.0 | 257.3 | 257.1 | 250.5 | |||||||||||
Sales and marketing | 246.3 | 246.6 | 254.9 | 253.2 | |||||||||||
General and administrative | 44.9 | 44.3 | 44.5 | 45.5 | |||||||||||
Amortization of purchased intangibles | 1.5 | 1.3 | 1.3 | 1.2 | |||||||||||
Restructuring and other charges (1) | (0.3 | ) | (0.9 | ) | 16.8 | 15.0 | |||||||||
Acquisition-related and other charges (2) | 4.1 | 2.7 | — | 0.3 | |||||||||||
Total operating expenses | 558.5 | 551.3 | 574.6 | 565.7 | |||||||||||
Operating income | 177.4 | 170.9 | 137.0 | 133.2 | |||||||||||
Interest and other income (expense), net | (6.5 | ) | (13.7 | ) | (15.9 | ) | (10.7 | ) | |||||||
Income before income taxes and noncontrolling interest | 170.9 | 157.2 | 121.1 | 122.5 | |||||||||||
Income tax provision | 41.3 | 41.7 | 37.4 | 26.3 | |||||||||||
Consolidated net income | 129.6 | 115.5 | 83.7 | 96.2 | |||||||||||
Adjust for net loss attributable to noncontrolling interest | 0.1 | — | — | — | |||||||||||
Net income attributable to Juniper Networks | $ | 129.7 | $ | 115.5 | $ | 83.7 | $ | 96.2 | |||||||
Net income per share attributable to Juniper Networks common stockholders: (3) | |||||||||||||||
Basic | $ | 0.24 | $ | 0.22 | $ | 0.16 | $ | 0.18 | |||||||
Diluted | $ | 0.24 | $ | 0.21 | $ | 0.16 | $ | 0.18 |
Year Ended December 31, 2010 | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||
Net revenues: | |||||||||||||||
Product | $ | 721.2 | $ | 774.1 | $ | 801.2 | $ | 962.2 | |||||||
Service | 191.4 | 204.2 | 211.2 | 227.8 | |||||||||||
Total net revenues | 912.6 | 978.3 | 1,012.4 | 1,190.0 | |||||||||||
Cost of revenues: | |||||||||||||||
Product | 222.4 | 231.8 | 247.0 | 299.7 | |||||||||||
Service | 78.2 | 86.6 | 87.6 | 98.3 | |||||||||||
Total cost of revenues | 300.6 | 318.4 | 334.6 | 398.0 | |||||||||||
Gross margin | 612.0 | 659.9 | 677.8 | 792.0 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 207.0 | 224.8 | 231.2 | 254.9 | |||||||||||
Sales and marketing | 192.4 | 202.3 | 204.7 | 257.7 | |||||||||||
General and administrative | 43.1 | 45.9 | 43.8 | 45.1 | |||||||||||
Amortization of purchased intangibles | 1.1 | 1.2 | 0.9 | 0.9 | |||||||||||
Restructuring charges (1) | 8.1 | 0.2 | 0.2 | 2.3 | |||||||||||
Acquisition-related charges (2) | — | 0.5 | 1.5 | 4.3 | |||||||||||
Total operating expenses | 451.7 | 474.9 | 482.3 | 565.2 | |||||||||||
Operating income | 160.3 | 185.0 | 195.5 | 226.8 | |||||||||||
Other income (expense), net | 1.4 | 4.0 | 0.2 | 4.8 | |||||||||||
Income before income taxes and noncontrolling interest | 161.7 | 189.0 | 195.7 | 231.6 | |||||||||||
Income tax (benefit) provision | (2.9 | ) | 58.7 | 61.4 | 41.5 | ||||||||||
Consolidated net income | 164.6 | 130.3 | 134.3 | 190.1 | |||||||||||
Adjust for net (income) loss attributable to noncontrolling interest | (1.5 | ) | 0.2 | 0.2 | 0.1 | ||||||||||
Net income attributable to Juniper Networks | $ | 163.1 | $ | 130.5 | $ | 134.5 | $ | 190.2 | |||||||
Net income per share attributable to Juniper Networks common stockholders: (3) | |||||||||||||||
Basic | $ | 0.31 | $ | 0.25 | $ | 0.26 | $ | 0.36 | |||||||
Diluted | $ | 0.30 | $ | 0.24 | $ | 0.25 | $ | 0.35 |
|
|
Balance at Beginning of Year | Charged to (Reversed from) Costs and Expenses | Recoveries (Deductions), Net | Balance at End of Year | ||||||||||||
(In millions) | |||||||||||||||
Year ended December 31, 2011 | |||||||||||||||
Allowance for doubtful accounts | $ | 10.1 | $ | (0.2 | ) | $ | (0.4 | ) | $ | 9.5 | |||||
Sales returns reserve | $ | 52.8 | $ | 108.8 | $ | (109.6 | ) | $ | 52.0 | ||||||
Year ended December 31, 2010 | |||||||||||||||
Allowance for doubtful accounts | $ | 9.1 | $ | 1.2 | $ | (0.2 | ) | $ | 10.1 | ||||||
Sales returns reserve | $ | 45.6 | $ | 104.4 | $ | (97.2 | ) | $ | 52.8 | ||||||
Year ended December 31, 2009 | |||||||||||||||
Allowance for doubtful accounts | $ | 9.7 | $ | (0.6 | ) | $ | — | $ | 9.1 | ||||||
Sales returns reserve | $ | 36.8 | $ | 84.1 | $ | (75.3 | ) | $ | 45.6 |
|
• | Persuasive evidence of an arrangement exists. The Company generally relies upon sales contracts or agreements, and customer purchase orders to determine the existence of an arrangement. |
• | Delivery has occurred. The Company uses shipping terms and related documents, or written evidence of customer acceptance, when applicable, to verify delivery or performance. |
• | Sales price is fixed or determinable. The Company assesses whether the sales price is fixed or determinable based on the payment terms and whether the sales price is subject to refund or adjustment. |
• | Collectability is reasonably assured. The Company assesses collectability based on creditworthiness of customers as determined by our credit checks and their payment histories. The Company records accounts receivable net of allowance for doubtful accounts, estimated customer returns, and pricing credits. |
|
As of December 31, | |||||||
2011 | 2010 | ||||||
Cash: | |||||||
Demand deposits | $ | 633.7 | $ | 413.0 | |||
Time deposits | 926.0 | 273.3 | |||||
Total cash | 1,559.7 | 686.3 | |||||
Cash equivalents: | |||||||
U.S. government securities | — | 76.7 | |||||
Government-sponsored enterprise obligations | 24.5 | 5.0 | |||||
Commercial paper | 10.0 | 4.0 | |||||
Money market funds | 1,316.2 | 1,039.9 | |||||
Total cash equivalents | 1,350.7 | 1,125.6 | |||||
Total cash and cash equivalents | $ | 2,910.4 | $ | 1,811.9 |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
As of December 31, 2011: | |||||||||||||||
Fixed income securities: | |||||||||||||||
U.S. government securities | $ | 301.1 | $ | — | $ | (0.1 | ) | $ | 301.0 | ||||||
Government-sponsored enterprise obligations | 406.3 | 0.3 | (0.1 | ) | 406.5 | ||||||||||
Foreign government debt securities | — | — | — | — | |||||||||||
Certificates of deposit | 31.8 | — | — | 31.8 | |||||||||||
Asset-backed securities | 124.7 | 0.1 | (0.1 | ) | 124.7 | ||||||||||
Corporate debt securities | 508.2 | 1.0 | (0.5 | ) | 508.7 | ||||||||||
Total fixed income securities | 1,372.1 | 1.4 | (0.8 | ) | 1,372.7 | ||||||||||
Total available-for-sale securities | 1,372.1 | 1.4 | (0.8 | ) | 1,372.7 | ||||||||||
Trading securities: | |||||||||||||||
Mutual funds (1) | 9.3 | — | — | 9.3 | |||||||||||
Total trading securities | 9.3 | — | — | 9.3 | |||||||||||
Total | $ | 1,381.4 | $ | 1.4 | $ | (0.8 | ) | $ | 1,382.0 | ||||||
Reported as: | |||||||||||||||
Short-term investments | $ | 640.9 | $ | 0.4 | $ | — | $ | 641.3 | |||||||
Long-term investments | 740.5 | 1.0 | (0.8 | ) | 740.7 | ||||||||||
Total | $ | 1,381.4 | $ | 1.4 | $ | (0.8 | ) | $ | 1,382.0 |
(1) | Balance includes the Company's non-qualified deferred compensation plan assets. For additional information, see Note 12, Employee Benefits Plans, under the section Deferred Compensation Plan. |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
As of December 31, 2010: | |||||||||||||||
Fixed income securities: | |||||||||||||||
U.S. government securities | $ | 158.2 | $ | 0.2 | $ | — | $ | 158.4 | |||||||
Government-sponsored enterprise obligations | 213.8 | 0.4 | (0.2 | ) | 214.0 | ||||||||||
Foreign government debt securities | 46.8 | 0.2 | — | 47.0 | |||||||||||
Certificates of deposit | 20.9 | 0.1 | — | 21.0 | |||||||||||
Commercial paper | 9.5 | — | — | 9.5 | |||||||||||
Asset-backed securities | 90.1 | — | (0.1 | ) | 90.0 | ||||||||||
Corporate debt securities | 459.7 | 2.2 | (0.2 | ) | 461.7 | ||||||||||
Total fixed income securities | 999.0 | 3.1 | (0.5 | ) | 1,001.6 | ||||||||||
Total available-for-sale securities | 999.0 | 3.1 | (0.5 | ) | 1,001.6 | ||||||||||
Trading securities: | |||||||||||||||
Mutual funds (1) | 8.1 | — | — | 8.1 | |||||||||||
Total trading securities | 8.1 | — | — | 8.1 | |||||||||||
Total | $ | 1,007.1 | $ | 3.1 | $ | (0.5 | ) | $ | 1,009.7 | ||||||
Reported as: | |||||||||||||||
Short-term investments | $ | 473.6 | $ | 0.9 | $ | — | $ | 474.5 | |||||||
Long-term investments | 533.5 | 2.2 | (0.5 | ) | 535.2 | ||||||||||
Total | $ | 1,007.1 | $ | 3.1 | $ | (0.5 | ) | $ | 1,009.7 |
(1) | Balance includes the Company's non-qualified deferred compensation plan assets. For additional information, see Note 12, Employee Benefits Plans, under the section Deferred Compensation Plan. |
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||
Due within one year | $ | 631.6 | $ | 0.4 | $ | — | $ | 632.0 | |||||||
Due between one and five years | 740.5 | 1.0 | (0.8 | ) | 740.7 | ||||||||||
Total | $ | 1,372.1 | $ | 1.4 | $ | (0.8 | ) | $ | 1,372.7 |
Less than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||
As of December 31, 2011 | |||||||||||||||||||||||
Corporate debt securities | $ | 189.9 | $ | (0.5 | ) | $ | — | $ | — | $ | 189.9 | $ | (0.5 | ) | |||||||||
U.S. government securities | 186.7 | (0.1 | ) | — | — | 186.7 | (0.1 | ) | |||||||||||||||
Government-sponsored enterprise obligations | 146.0 | (0.1 | ) | — | — | 146.0 | (0.1 | ) | |||||||||||||||
Asset-backed securities | 76.8 | (0.1 | ) | 0.3 | * | — | 77.1 | * | (0.1 | ) | |||||||||||||
Total | $ | 599.4 | $ | (0.8 | ) | $ | 0.3 | $ | — | $ | 599.7 | $ | (0.8 | ) |
Less than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||
Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | Fair Value | Unrealized Loss | ||||||||||||||||||
As of December 31, 2010 | |||||||||||||||||||||||
Corporate debt securities | $ | 104.3 | $ | (0.2 | ) | $ | 28.8 | * | $ | — | $ | 133.1 | * | $ | (0.2 | ) | |||||||
Government-sponsored enterprise obligations | 57.8 | (0.2 | ) | — | — | 57.8 | (0.2 | ) | |||||||||||||||
Foreign government debt securities | — | — | 6.2 | * | — | 6.2 | * | — | |||||||||||||||
Commercial paper | 5.0 | * | — | — | — | 5.0 | * | — | |||||||||||||||
Asset-backed securities | 54.7 | (0.1 | ) | — | — | 54.7 | (0.1 | ) | |||||||||||||||
Total | $ | 221.8 | $ | (0.5 | ) | $ | 35.0 | $ | — | $ | 256.8 | $ | (0.5 | ) |
As of December 31, | |||||||
2011 | 2010 | ||||||
Restricted cash: | |||||||
Demand deposits | $ | 0.6 | $ | 1.7 | |||
Total restricted cash | 0.6 | 1.7 | |||||
Restricted investments: | |||||||
U.S. government securities | — | 0.6 | |||||
Corporate debt securities | 1.6 | 2.7 | |||||
Mutual funds | 1.0 | — | |||||
Money market funds | 75.1 | 114.3 | |||||
Total restricted investments | 77.7 | 117.6 | |||||
Total restricted cash and investments | $ | 78.3 | $ | 119.3 |
|
Fair Value Measurements at December 31, 2011 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Assets measured at fair value: | |||||||||||||||
Available-for-sale debt securities: | |||||||||||||||
U.S. government securities | $ | 149.3 | $ | 151.7 | $ | — | $ | 301.0 | |||||||
Government-sponsored enterprise obligations | 314.2 | 116.8 | — | 431.0 | |||||||||||
Commercial paper | — | 10.0 | — | 10.0 | |||||||||||
Corporate debt securities (1) | — | 510.3 | — | 510.3 | |||||||||||
Certificate of deposit | — | 31.8 | — | 31.8 | |||||||||||
Asset-backed securities | — | 124.7 | — | 124.7 | |||||||||||
Money market funds (2) | 1,391.3 | — | — | 1,391.3 | |||||||||||
Total available-for-sale debt securities | 1,854.8 | 945.3 | — | 2,800.1 | |||||||||||
Total available-for-sale securities | 1,854.8 | 945.3 | — | 2,800.1 | |||||||||||
Trading securities: | |||||||||||||||
Mutual funds (3) | 10.3 | — | — | 10.3 | |||||||||||
Total trading securities | 10.3 | — | — | 10.3 | |||||||||||
Derivative assets: | |||||||||||||||
Foreign exchange contracts | — | 0.4 | — | 0.4 | |||||||||||
Total derivative assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,865.1 | $ | 945.7 | $ | — | $ | 2,810.8 | |||||||
Liabilities measured at fair value: | |||||||||||||||
Derivative liabilities: | |||||||||||||||
Foreign exchange contracts | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) | |||||
Total derivative liabilities | — | (9.6 | ) | — | (9.6 | ) | |||||||||
Total liabilities measured at fair value | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) |
(1) | Balance includes $1.6 million of restricted investments measured at fair market value, related to the Company's India Gratuity Trust. |
(2) | Balance includes $75.1 million of restricted investments measured at fair market value, related to the Company's D&O trust and acquisition related escrows. |
(3) | Balance includes $9.3 million of the Company's non-qualified deferred compensation plan assets and $1.0 million of restricted investments measured at fair market value, related to the Company's India Gratuity Trust. |
Fair Value Measurements at December 31, 2010 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Assets measured at fair value: | |||||||||||||||
Available-for-sale debt securities: | |||||||||||||||
U.S. government securities (1) | $ | 54.9 | $ | 180.8 | $ | — | $ | 235.7 | |||||||
Government-sponsored enterprise obligations | 208.9 | 10.1 | — | 219.0 | |||||||||||
Foreign government debt securities | 21.0 | 26.0 | — | 47.0 | |||||||||||
Commercial paper | — | 13.5 | — | 13.5 | |||||||||||
Corporate debt securities (2) | 2.7 | 461.7 | — | 464.4 | |||||||||||
Certificate of deposit | — | 21.0 | — | 21.0 | |||||||||||
Asset-backed securities | — | 90.0 | — | 90.0 | |||||||||||
Money market funds (3) | 1,154.2 | — | — | 1,154.2 | |||||||||||
Total available-for-sale debt securities | 1,441.7 | 803.1 | — | 2,244.8 | |||||||||||
Total available-for-sale securities | 1,441.7 | 803.1 | — | 2,244.8 | |||||||||||
Trading securities: | |||||||||||||||
Mutual funds | 8.1 | — | — | 8.1 | |||||||||||
Total trading securities | 8.1 | — | — | 8.1 | |||||||||||
Derivative assets: | |||||||||||||||
Foreign exchange contracts | — | 0.4 | — | 0.4 | |||||||||||
Total derivative assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,449.8 | $ | 803.5 | $ | — | $ | 2,253.3 | |||||||
Liabilities measured at fair value: | |||||||||||||||
Derivative liabilities: | |||||||||||||||
Foreign exchange contracts | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) | |||||
Total derivative liabilities | — | (2.6 | ) | — | (2.6 | ) | |||||||||
Total liabilities measured at fair value | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) |
(1) | Balance includes $0.6 million of restricted investments measured at fair market value, related to an acquisition completed in 2005. For additional information regarding the Company's restricted investments, see Note 4, Cash, Cash Equivalents, and Investments, under the heading “Restricted Cash and Investments.” Restricted investments are included in the restricted cash balance in the consolidated balance sheet. |
(2) | Balance includes $2.7 million of restricted investments measured at fair market value, related to the Company's India Gratuity Trust. |
(3) | Balance includes $114.3 million of restricted investments measured at fair market value, related to the Company's D&O trust and acquisition related escrows. |
Fair Value Measurements at December 31, 2011 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Total assets measured at fair value, reported as: | |||||||||||||||
Cash equivalents | $ | 1,316.2 | $ | 34.5 | $ | — | $ | 1,350.7 | |||||||
Short-term investments | 168.9 | 472.4 | — | 641.3 | |||||||||||
Long-term investments | 303.9 | 436.8 | — | 740.7 | |||||||||||
Restricted cash and investments | 76.1 | 1.6 | — | 77.7 | |||||||||||
Prepaid expenses and other current assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,865.1 | $ | 945.7 | $ | — | $ | 2,810.8 | |||||||
Total liabilities measured at fair value, reported as: | |||||||||||||||
Other accrued liabilities | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) | |||||
Total liabilities measured at fair value | $ | — | $ | (9.6 | ) | $ | — | $ | (9.6 | ) |
Fair Value Measurements at December 31, 2010 Using: | |||||||||||||||
Quoted Prices in Active Markets For Identical Assets | Significant Other Observable Remaining Inputs | Significant Other Unobservable Remaining Inputs | |||||||||||||
(Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
Total assets measured at fair value, reported as: | |||||||||||||||
Cash equivalents | $ | 1,039.9 | $ | 85.7 | $ | — | $ | 1,125.6 | |||||||
Short-term investments | 150.7 | 323.8 | — | 474.5 | |||||||||||
Long-term investments | 142.2 | 393.0 | — | 535.2 | |||||||||||
Restricted cash | 117.0 | 0.6 | — | 117.6 | |||||||||||
Prepaid expenses and other current assets | — | 0.4 | — | 0.4 | |||||||||||
Total assets measured at fair value | $ | 1,449.8 | $ | 803.5 | $ | — | $ | 2,253.3 | |||||||
Total liabilities measured at fair value, reported as: | |||||||||||||||
Other accrued liabilities | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) | |||||
Total liabilities measured at fair value | $ | — | $ | (2.6 | ) | $ | — | $ | (2.6 | ) |
|
As of December 31, | |||||||
2011 | 2010 | ||||||
Cash flow hedges | $ | 184.3 | $ | 110.4 | |||
Non-designated hedges | 122.7 | 74.4 | |||||
Total | $ | 307.0 | $ | 184.8 |
|
Allocation of purchase consideration: | 2011 Acquisitions | 2010 Acquisitions | |||||
Net tangible assets acquired | $ | 1.7 | $ | 8.8 | |||
Intangible assets acquired | 28.4 | 116.5 | |||||
Goodwill | 0.4 | 269.2 | |||||
Total | $ | 30.5 | $ | 394.5 |
Ankeena | SMobile | Altor | Trapeze | Total | |||||||||||||||
Net cash | $ | 66.5 | $ | 69.5 | $ | 104.0 | $ | 152.1 | $ | 392.1 | |||||||||
Assumed stock option and RSU awards allocated to purchase price (1) | 2.4 | — | — | — | 2.4 | ||||||||||||||
Total | $ | 68.9 | $ | 69.5 | $ | 104.0 | $ | 152.1 | $ | 394.5 |
(1) | The fair value of the stock option and RSU awards assumed was based on the acquired company's determined value on the acquisition date. |
2011 Acquisitions | ||||
Estimated Useful Life (In Years) | Amount | |||
Existing or Core technology | 10 | $ | 21.9 | |
Support agreements and related relationships | 4 | 5.1 | ||
Patents | 5 | 1.4 | ||
Total | $ | 28.4 |
2010 Acquisitions | |||||||||||||||||||||||||||||||
Ankeena | SMobile | Altor | Trapeze | ||||||||||||||||||||||||||||
Estimated Useful Life (In Years) | Amount | Estimated Useful Life (In Years) | Amount | Estimated Useful Life (In Years) | Amount | Estimated Useful Life (In Years) | Amount | Total Amount | |||||||||||||||||||||||
Existing technology | 4.0 | $ | 9.0 | 5.0 | $ | 24.3 | 6.0 | $ | 13.9 | 5.0 | $ | 45.0 | $ | 92.2 | |||||||||||||||||
In-process research and development | — | — | — | — | — | 2.8 | — | — | 2.8 | ||||||||||||||||||||||
Core technology | 4.0 | 3.2 | — | — | 6.0 | 4.6 | — | — | 7.8 | ||||||||||||||||||||||
Customer contracts and related relationships | — | — | 6.0 | 2.1 | — | — | 7.0 | 8.6 | 10.7 | ||||||||||||||||||||||
Support agreements and related relationships | — | — | 6.0 | 0.1 | — | — | 7.0 | 2.6 | 2.7 | ||||||||||||||||||||||
Non-compete agreements | — | — | 2.0 | 0.1 | — | — | — | — | 0.1 | ||||||||||||||||||||||
OEM customer contracts | — | — | — | — | — | — | 2.0 | 0.2 | 0.2 | ||||||||||||||||||||||
Total | $ | 12.2 | $ | 26.6 | $ | 21.3 | $ | 56.4 | $ | 116.5 |
|
Infrastructure | SLT | Total | |||||||||
December 31, 2009 | $ | 1,500.5 | $ | 2,158.1 | $ | 3,658.6 | |||||
Adjustment to goodwill | — | 0.2 | 0.2 | ||||||||
Additions due to business combinations | 142.9 | 126.1 | 269.0 | ||||||||
December 31, 2010 | 1,643.4 | 2,284.4 | 3,927.8 | ||||||||
Adjustments to goodwill | 1.7 | (1.8 | ) | (0.1 | ) | ||||||
Additions due to business combinations | 0.4 | — | 0.4 | ||||||||
December 31, 2011 | $ | 1,645.5 | $ | 2,282.6 | $ | 3,928.1 |
Gross | Accumulated Amortization | Net | |||||||||
As of December 31, 2011: | |||||||||||
Intangible assets with finite lives: | |||||||||||
Technologies and patents | $ | 499.5 | $ | (404.2 | ) | $ | 95.3 | ||||
Other | 91.5 | (66.5 | ) | 25.0 | |||||||
Total intangible assets with finite lives | 591.0 | (470.7 | ) | 120.3 | |||||||
IPR&D with indefinite lives | 2.8 | — | 2.8 | ||||||||
Total purchased intangible assets | $ | 593.8 | $ | (470.7 | ) | $ | 123.1 | ||||
As of December 31, 2010: | |||||||||||
Intangible assets with finite lives: | |||||||||||
Technologies and patents | $ | 471.1 | $ | (381.4 | ) | $ | 89.7 | ||||
Other | 86.4 | (62.2 | ) | 24.2 | |||||||
Total intangible assets with finite lives | 557.5 | (443.6 | ) | 113.9 | |||||||
IPR&D with indefinite lives | 7.9 | — | 7.9 | ||||||||
Total purchased intangible assets | $ | 565.4 | $ | (443.6 | ) | $ | 121.8 |
Years Ending December 31, | Amount | |||
2012 | $ | 27.4 | ||
2013 | 27.2 | |||
2014 | 25.3 | |||
2015 | 20.4 | |||
2016 | 7.7 | |||
Thereafter | 12.3 | |||
Total | $ | 120.3 |
|
As of December 31, | |||||||
2011 | 2010 | ||||||
Inventories, net | |||||||
Production materials | $ | 52.4 | $ | 5.8 | |||
Finished goods | 16.7 | 15.8 | |||||
Total inventories, net | $ | 69.1 | $ | 21.6 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Computers and equipment | $ | 604.6 | $ | 514.3 | |||
Software | 110.2 | 101.6 | |||||
Leasehold improvements | 204.1 | 179.0 | |||||
Furniture and fixtures | 27.4 | 24.9 | |||||
Building and building improvements | 6.2 | — | |||||
Land and land improvements | 208.2 | 203.7 | |||||
Construction-in-process | 99.7 | 41.9 | |||||
Property and equipment, gross | 1,260.4 | 1,065.4 | |||||
Accumulated depreciation | (661.8 | ) | (571.5 | ) | |||
Property and equipment, net | $ | 598.6 | $ | 493.9 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Deferred product revenue: | |||||||
Undelivered product commitments and other product deferrals | $ | 288.1 | $ | 294.1 | |||
Distributor inventory and other sell-through items | 134.0 | 143.4 | |||||
Deferred gross product revenue | 422.1 | 437.5 | |||||
Deferred cost of product revenue | (136.9 | ) | (148.8 | ) | |||
Deferred product revenue, net | 285.2 | 288.7 | |||||
Deferred service revenue | 681.8 | 595.7 | |||||
Total | $ | 967.0 | $ | 884.4 | |||
Reported as: | |||||||
Current | $ | 712.6 | $ | 660.2 | |||
Long-term | 254.4 | 224.2 | |||||
Total deferred revenue | $ | 967.0 | $ | 884.4 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Beginning balance | $ | 35.9 | $ | 38.2 | |||
Provisions made during the period, net | 52.5 | 49.9 | |||||
Change in estimate | (12.6 | ) | (3.0 | ) | |||
Actual costs incurred during the period | (47.5 | ) | (49.2 | ) | |||
Ending balance | $ | 28.3 | $ | 35.9 |
Remaining Liability as of December 31, 2010 | Charges | Cash payments | Non-cash Settlements and Other Adjustments | Remaining Liability as of December 31, 2011 | |||||||||||||||
Facilities | $ | 7.7 | $ | 0.2 | $ | (5.3 | ) | $ | (1.6 | ) | $ | 1.0 | |||||||
Severance, contractual commitments, and other charges | 0.2 | 16.9 | (13.3 | ) | (0.7 | ) | 3.1 | ||||||||||||
Total | $ | 7.9 | $ | 17.1 | $ | (18.6 | ) | $ | (2.3 | ) | $ | 4.1 |
Remaining Liability as of December 31, 2009 | Charges | Cash payments | Non-cash Settlements and Other Adjustments | Remaining Liability as of December 31, 2010 | |||||||||||||||
Facilities | $ | 4.9 | $ | 6.9 | $ | (2.5 | ) | $ | (1.6 | ) | $ | 7.7 | |||||||
Severance, contractual commitments, and other charges | 4.5 | 3.9 | (5.5 | ) | (2.7 | ) | 0.2 | ||||||||||||
Total | $ | 9.4 | $ | 10.8 | $ | (8.0 | ) | $ | (4.3 | ) | $ | 7.9 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Interest income | $ | 9.7 | $ | 10.5 | $ | 11.8 | |||||
Interest expense | (49.5 | ) | (8.7 | ) | (6.0 | ) | |||||
Other income and expense, net | (7.0 | ) | 8.8 | (4.6 | ) | ||||||
Other (expense) income, net | $ | (46.8 | ) | $ | 10.6 | $ | 1.4 |
|
As of | ||||||
December 31, 2011 | ||||||
Amount | Effective Interest Rate | |||||
3.10% fixed-rate Notes, due 2016 | $ | 300.0 | 3.12 | % | ||
4.60% fixed-rate Notes, due 2021 | 300.0 | 4.63 | % | |||
5.95% fixed-rate Notes, due 2041 | 400.0 | 6.01 | % | |||
Total Notes | 1,000.0 | |||||
Unaccreted discount | (1.0 | ) | ||||
Total long-term debt | $ | 999.0 |
|
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Consolidated net income | $ | 425.0 | $ | 619.4 | $ | 115.2 | |||||
Other comprehensive income (loss), net: | |||||||||||
Change in unrealized gain (loss) on investments, net | (9.9 | ) | (0.3 | ) | (2.8 | ) | |||||
Change in foreign currency translation adjustment, net | (6.4 | ) | 0.5 | 5.6 | |||||||
Total other comprehensive income (loss), net | (16.3 | ) | 0.2 | 2.8 | |||||||
Consolidated comprehensive income | 408.7 | 619.6 | 118.0 | ||||||||
Adjust for comprehensive loss (income) attributable to noncontrolling interest, net | 0.1 | (1.0 | ) | 1.8 | |||||||
Comprehensive income attributable to Juniper Networks | $ | 408.8 | $ | 618.6 | $ | 119.8 |
|
Outstanding Options | |||||||||||||
Number of Shares | Weighted Average Exercise Price per Share | Weighted Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value | ||||||||||
Balance at December 31, 2008 | 73.6 | $ | 21.24 | ||||||||||
Options granted | 9.9 | 17.86 | |||||||||||
Options canceled | (2.3 | ) | 21.57 | ||||||||||
Options exercised | (8.6 | ) | 14.59 | ||||||||||
Options expired | (5.2 | ) | 34.91 | ||||||||||
Balance at December 31, 2009 | 67.4 | 20.84 | 4.6 | $ | 451.2 | ||||||||
Options granted | 6.2 | 29.15 | |||||||||||
Options assumed (1) | 0.5 | 31.65 | |||||||||||
Options canceled | (2.3 | ) | 22.03 | ||||||||||
Options exercised | (21.6 | ) | 18.99 | ||||||||||
Options expired | (0.8 | ) | 61.48 | ||||||||||
Balance at December 31, 2010 | 49.4 | 21.90 | 4.1 | $ | 744.5 | ||||||||
Options granted | 5.6 | 37.17 | |||||||||||
Options canceled | (1.9 | ) | 26.76 | ||||||||||
Options exercised | (13.9 | ) | 21.13 | ||||||||||
Options expired | (0.6 | ) | 34.32 | ||||||||||
Balance at December 31, 2011 | 38.6 | $ | 23.98 | 3.7 | $ | 75.3 | |||||||
As of December 31, 2011: | |||||||||||||
Vested or expected-to-vest options | 36.9 | $ | 23.66 | 3.7 | $ | 74.2 | |||||||
Exercisable options | 26.1 | $ | 21.51 | 3.0 | $ | 61.7 |
(1) | Stock options assumed in connection with the acquisition of Ankeena and Altor. |
Options Outstanding | Options Exercisable | ||||||||||||||||
Range of Exercise Price | Number Outstanding | Weighted-Average Remaining Contractual Life | Weighted-Average Exercise Price | Number Exercisable | Weighted-Average Exercise Price | ||||||||||||
(In millions) | (In years) | (In dollars) | (In millions) | (In dollars) | |||||||||||||
$0.33 - $14.91 | 4.3 | 2.2 | $ | 10.84 | 3.7 | $ | 10.45 | ||||||||||
$15.00 - $15.09 | 4.0 | 3.5 | 15.07 | 2.7 | 15.06 | ||||||||||||
$15.32 - $18.96 | 4.4 | 2.5 | 17.69 | 3.9 | 17.78 | ||||||||||||
$19.45 - $22.74 | 4.0 | 3.8 | 21.27 | 2.7 | 21.36 | ||||||||||||
$22.97 - $25.16 | 5.7 | 3.1 | 24.47 | 5.3 | 24.44 | ||||||||||||
$25.19 - $26.90 | 4.6 | 3.9 | 26.33 | 3.2 | 26.35 | ||||||||||||
$26.97 - $29.89 | 4.9 | 4.8 | 28.58 | 2.5 | 28.46 | ||||||||||||
$29.93 - $38.93 | 3.2 | 4.3 | 33.35 | 2.1 | 32.77 | ||||||||||||
$40.26 - $44.00 | 3.5 | 6.2 | 41.87 | — | — | ||||||||||||
38.6 | 3.7 | $ | 23.98 | 26.1 | $ | 21.51 |
Outstanding RSUs and PSAs | |||||||||||||
Number of Shares | Weighted Average Grant-Date Fair Value per Share | Weighted Average Remaining Contractual Term (In Years) | Aggregate Intrinsic Value | ||||||||||
Balance at January 1, 2009 | 6.7 | $ | 24.59 | ||||||||||
RSUs granted | 1.8 | $ | 17.87 | ||||||||||
PSAs granted | 2.9 | $ | 18.05 | ||||||||||
RSUs vested | (1.3 | ) | $ | 21.05 | |||||||||
PSAs vested | (0.1 | ) | $ | 26.90 | |||||||||
RSUs canceled | (0.7 | ) | $ | 24.67 | |||||||||
PSAs canceled | (0.2 | ) | $ | 19.12 | |||||||||
Balance at December 31, 2009 | 9.1 | $ | 21.76 | 1.6 | $ | 243.3 | |||||||
RSUs granted | 4.0 | $ | 30.19 | ||||||||||
RSUs assumed (1) | 0.5 | $ | 32.09 | ||||||||||
PSAs granted | 3.8 | $ | 29.25 | ||||||||||
RSUs vested | (1.8 | ) | $ | 25.30 | |||||||||
PSAs vested | (0.4 | ) | $ | 20.64 | |||||||||
RSUs canceled | (0.6 | ) | $ | 24.87 | |||||||||
PSAs canceled | (0.4 | ) | $ | 22.57 | |||||||||
Balance at December 31, 2010 | 14.2 | $ | 25.94 | 1.7 | $ | 522.9 | |||||||
RSUs granted | 7.3 | $ | 31.75 | ||||||||||
PSAs granted (2) | 4.5 | $ | 38.64 | ||||||||||
RSUs vested | (1.7 | ) | $ | 23.26 | |||||||||
PSAs vested | (0.8 | ) | $ | 24.76 | |||||||||
RSUs canceled | (1.0 | ) | $ | 31.57 | |||||||||
PSAs canceled | (2.9 | ) | $ | 30.72 | |||||||||
Balance at December 31, 2011 | 19.6 | $ | 30.27 | 1.5 | $ | 400.5 | |||||||
As of December 31, 2011: | |||||||||||||
Vested and expected-to-vest RSUs and PSAs | 16.7 | $ | 29.97 | 1.3 | $ | 341.0 |
(1) | RSUs assumed in connection with the acquisitions of Ankeena and Altor. |
(2) | The number of shares subject to PSAs granted represents the aggregate maximum number of shares that may be issued pursuant to the award over its full term. The aggregate number of shares subject to these PSAs that would be issued if performance goals determined by the Compensation Committee are achieved is estimated at 1.9 million shares. Depending on achievement of such performance goals, the range of shares that could be issued under these awards is 0 to 4.5 million shares. |
Number of Shares | ||
Balance at January 1, 2011 | 30.7 | |
Additional authorized share reserve approved by stockholders | 30.0 | |
RSUs and PSAs granted (1) | (24.6 | ) |
Options granted | (5.6 | ) |
RSUs and PSAs canceled (1) | 8.1 | |
Options canceled (2) | 1.9 | |
Options expired (2) | 0.6 | |
Balance at December 31, 2011 | 41.1 |
(1) | RSUs and PSAs with a per share or unit purchase price lower than 100% of the fair market value of the Company's common stock on the day of the grant under the 2006 Plan are counted against shares authorized under the plan as two and one-tenth shares of common stock for each share subject to such award. The number of shares subject to PSAs granted represents the maximum number of shares that may be issued pursuant to the award over its full term. |
(2) | Includes canceled or expired options under the 1996 Plan and the 2000 Plan that expired unexercised after May 18, 2006, which become available for grant under the 2006 Plan according to its terms. |
Years Ended December 31, | |||||
2011 | 2010 | 2009 | |||
Employee Stock Options: | |||||
Volatility factor | 43% | 38% | 50% | ||
Risk-free interest rate | 1.5% | 2.0% | 1.6% | ||
Expected life (years) | 4.1 | 4.3 | 4.2 | ||
Dividend yield | — | — | — | ||
Weighted-average fair value per share | $13.17 | $9.77 | $7.41 | ||
Employee Stock Purchase Plan: | |||||
Volatility factor | 41% | 35% | 54% | ||
Risk-free interest rate | 0.2% | 0.2% | 0.4% | ||
Expected life (years) | 0.5 | 0.5 | 0.5 | ||
Dividend yield | — | — | — | ||
Weighted-average fair value per share | $7.48 | $6.55 | $5.54 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Cost of revenues - Product | $ | 4.6 | $ | 4.4 | $ | 3.9 | |||||
Cost of revenues - Service | 15.7 | 13.5 | 10.5 | ||||||||
Research and development | 97.7 | 78.5 | 59.3 | ||||||||
Sales and marketing | 70.9 | 54.9 | 43.1 | ||||||||
General and administrative | 33.3 | 30.7 | 22.9 | ||||||||
Total | $ | 222.2 | $ | 182.0 | $ | 139.7 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Options | $ | 76.2 | $ | 81.5 | $ | 81.2 | |||||
Assumed options | — | 0.8 | — | ||||||||
RSUs and PSAs | 123.1 | 81.8 | 44.1 | ||||||||
Assumed RSUs | — | 0.6 | — | ||||||||
Employee stock purchase plan | 18.5 | 13.1 | 14.4 | ||||||||
Other acquisition-related compensation | 4.4 | 4.2 | — | ||||||||
Total | $ | 222.2 | $ | 182.0 | $ | 139.7 |
|
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Net revenues: | |||||||||||
Infrastructure: | |||||||||||
Routers | $ | 2,894.4 | $ | 2,655.7 | $ | 2,244.2 | |||||
Switches | 528.2 | 394.6 | 197.4 | ||||||||
Total Infrastructure | 3,422.6 | 3,050.3 | 2,441.6 | ||||||||
SLT | 1,026.1 | 1,043.0 | 874.3 | ||||||||
Total net revenues | $ | 4,448.7 | $ | 4,093.3 | $ | 3,315.9 | |||||
Segment operating income: | |||||||||||
Infrastructure | $ | 718.3 | $ | 773.7 | $ | 541.4 | |||||
SLT | 199.0 | 208.0 | 127.0 | ||||||||
Total segment operating income | 917.3 | 981.7 | 668.4 | ||||||||
Amortization of purchased intangible assets (1) | (27.1 | ) | (8.6 | ) | (15.4 | ) | |||||
Share-based compensation expense | (222.2 | ) | (182.0 | ) | (139.7 | ) | |||||
Share-based payroll tax expense | (9.3 | ) | (6.4 | ) | (0.8 | ) | |||||
Restructuring and other charges | (30.6 | ) | (10.8 | ) | (19.5 | ) | |||||
Acquisition-related and other charges (2) | (9.6 | ) | (6.3 | ) | (182.3 | ) | |||||
Total operating income | 618.5 | 767.6 | 310.7 | ||||||||
Other (expense) income, net | (46.8 | ) | 10.6 | 1.4 | |||||||
Income before income taxes and noncontrolling interest | $ | 571.7 | $ | 778.2 | $ | 312.1 |
(1) | Amount includes amortization expense of purchased intangible assets in operating expenses and in cost of revenues. |
(2) | Amount includes acquisition-related costs in operating expenses and in cost of revenues. |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Americas: | |||||||||||
United States | $ | 2,015.8 | $ | 1,890.1 | $ | 1,515.1 | |||||
Other | 222.2 | 205.5 | 172.8 | ||||||||
Total Americas | 2,238.0 | 2,095.6 | 1,687.9 | ||||||||
Europe, Middle East, and Africa | 1,339.8 | 1,189.3 | 953.2 | ||||||||
Asia Pacific | 870.9 | 808.4 | 674.8 | ||||||||
Total | $ | 4,448.7 | $ | 4,093.3 | $ | 3,315.9 |
|
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Domestic | $ | 218.4 | $ | 370.6 | $ | 50.1 | |||||
Foreign | 353.3 | 407.6 | 262.0 | ||||||||
Total income before provision for income taxes and noncontrolling interest | $ | 571.7 | $ | 778.2 | $ | 312.1 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Current provision (benefit): | |||||||||||
Federal | $ | 19.5 | $ | (8.4 | ) | $ | 123.8 | ||||
State | 0.9 | 1.0 | 21.4 | ||||||||
Foreign | 47.8 | 44.2 | 43.5 | ||||||||
Total current provision | 68.2 | 36.8 | 188.7 | ||||||||
Deferred provision (benefit): | |||||||||||
Federal | 23.0 | 57.5 | (42.7 | ) | |||||||
State | 0.6 | 14.0 | 55.7 | ||||||||
Foreign | (3.6 | ) | (7.5 | ) | (5.9 | ) | |||||
Total deferred provision | 20.0 | 64.0 | 7.1 | ||||||||
Income tax benefits attributable to employee stock plan activity | 58.5 | 58.0 | 1.0 | ||||||||
Total provision for income taxes | $ | 146.7 | $ | 158.8 | $ | 196.8 |
Years Ended December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Expected provision at 35% rate | $ | 200.1 | $ | 272.4 | $ | 109.2 | |||||
State taxes, net of federal benefit | 2.0 | 6.2 | (1.6 | ) | |||||||
Foreign income at different tax rates | (50.4 | ) | (71.5 | ) | (33.8 | ) | |||||
R&D credits | (21.3 | ) | (18.6 | ) | (14.4 | ) | |||||
Stock-based compensation | 16.7 | (40.2 | ) | 62.1 | |||||||
Temporary differences not currently benefited | — | 10.2 | 72.8 | ||||||||
Other | (0.4 | ) | 0.3 | 2.5 | |||||||
Total provision for income taxes | $ | 146.7 | $ | 158.8 | $ | 196.8 |
As of December 31, | |||||||
2011 | 2010 | ||||||
Deferred tax assets: | |||||||
Net operating loss carry-forwards | $ | 4.4 | $ | 14.1 | |||
Foreign tax credit carry-forwards | 48.7 | 40.3 | |||||
Research and other credit carry-forwards | 86.3 | 68.2 | |||||
Deferred revenue | 94.0 | 86.1 | |||||
Stock-based compensation | 91.2 | 75.6 | |||||
Reserves and accruals not currently deductible | 255.9 | 227.6 | |||||
Other | 31.0 | 26.8 | |||||
Total deferred tax assets | 611.5 | 538.7 | |||||
Valuation allowance | (145.2 | ) | (122.2 | ) | |||
Deferred tax assets, net of valuation allowance | 466.3 | 416.5 | |||||
Deferred tax liabilities: | |||||||
Property and equipment basis differences | (87.0 | ) | (47.1 | ) | |||
Purchased intangibles | (53.2 | ) | (58.5 | ) | |||
Unremitted foreign earnings | (210.5 | ) | (175.1 | ) | |||
Other | — | (0.1 | ) | ||||
Total deferred tax liabilities | (350.7 | ) | (280.8 | ) | |||
Net deferred tax assets | $ | 115.6 | $ | 135.7 |
As of December 31, | |||||||||||
2011 | 2010 | 2009 | |||||||||
Balance beginning of the year | $ | 116.4 | $ | 183.6 | $ | 113.5 | |||||
Tax positions related to current year: | |||||||||||
Additions | 17.6 | 13.9 | 12.7 | ||||||||
Tax positions related to prior years: | |||||||||||
Additions | 6.4 | — | 73.5 | ||||||||
Reductions | — | (73.8 | ) | (1.0 | ) | ||||||
Settlements | (5.4 | ) | (1.6 | ) | (12.8 | ) | |||||
Lapses in statutes of limitations | (2.8 | ) | (5.7 | ) | (2.3 | ) | |||||
Balance end of the year | $ | 132.2 | $ | 116.4 | $ | 183.6 |
|
Years Ending December 31, | |||||||||||||||||||||||||||||||
Total | 2012 | 2013 | 2014 | 2015 | 2016 | Thereafter | Other | ||||||||||||||||||||||||
Operating leases | $ | 352.7 | $ | 57.9 | $ | 50.8 | $ | 63.8 | $ | 53.4 | $ | 26.6 | $ | 100.2 | $ | — | |||||||||||||||
Purchase commitments | 150.6 | 150.6 | — | — | — | — | — | — | |||||||||||||||||||||||
Tax liabilities | 108.5 | — | — | — | — | — | — | 108.5 | |||||||||||||||||||||||
Long-term debt | 1,000.0 | — | — | — | — | 300.0 | 700.0 | — | |||||||||||||||||||||||
Interest payment on long-term debt | 873.1 | 46.9 | 46.9 | 46.9 | 46.9 | 41.9 | 643.6 | — | |||||||||||||||||||||||
Other contractual obligations | 73.1 | 63.3 | 4.8 | 3.0 | 2.0 | — | — | — | |||||||||||||||||||||||
Total | $ | 2,558.0 | $ | 318.7 | $ | 102.5 | $ | 113.7 | $ | 102.3 | $ | 368.5 | $ | 1,443.8 | $ | 108.5 |
|
Year Ended December 31, 2011 | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||
Net revenues: | |||||||||||||||
Product | $ | 877.4 | $ | 891.4 | $ | 861.9 | $ | 847.5 | |||||||
Service | 224.2 | 229.1 | 243.9 | 273.3 | |||||||||||
Total net revenues | 1,101.6 | 1,120.5 | 1,105.8 | 1,120.8 | |||||||||||
Cost of revenues: | |||||||||||||||
Product (2) | 265.7 | 292.4 | 286.6 | 310.6 | |||||||||||
Service | 100.0 | 105.9 | 107.6 | 111.3 | |||||||||||
Total cost of revenues | 365.7 | 398.3 | 394.2 | 421.9 | |||||||||||
Gross margin | 735.9 | 722.2 | 711.6 | 698.9 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 262.0 | 257.3 | 257.1 | 250.5 | |||||||||||
Sales and marketing | 246.3 | 246.6 | 254.9 | 253.2 | |||||||||||
General and administrative | 44.9 | 44.3 | 44.5 | 45.5 | |||||||||||
Amortization of purchased intangibles | 1.5 | 1.3 | 1.3 | 1.2 | |||||||||||
Restructuring and other charges (1) | (0.3 | ) | (0.9 | ) | 16.8 | 15.0 | |||||||||
Acquisition-related and other charges (2) | 4.1 | 2.7 | — | 0.3 | |||||||||||
Total operating expenses | 558.5 | 551.3 | 574.6 | 565.7 | |||||||||||
Operating income | 177.4 | 170.9 | 137.0 | 133.2 | |||||||||||
Interest and other income (expense), net | (6.5 | ) | (13.7 | ) | (15.9 | ) | (10.7 | ) | |||||||
Income before income taxes and noncontrolling interest | 170.9 | 157.2 | 121.1 | 122.5 | |||||||||||
Income tax provision | 41.3 | 41.7 | 37.4 | 26.3 | |||||||||||
Consolidated net income | 129.6 | 115.5 | 83.7 | 96.2 | |||||||||||
Adjust for net loss attributable to noncontrolling interest | 0.1 | — | — | — | |||||||||||
Net income attributable to Juniper Networks | $ | 129.7 | $ | 115.5 | $ | 83.7 | $ | 96.2 | |||||||
Net income per share attributable to Juniper Networks common stockholders: (3) | |||||||||||||||
Basic | $ | 0.24 | $ | 0.22 | $ | 0.16 | $ | 0.18 | |||||||
Diluted | $ | 0.24 | $ | 0.21 | $ | 0.16 | $ | 0.18 |
Year Ended December 31, 2010 | First Quarter | Second Quarter | Third Quarter | Fourth Quarter | |||||||||||
Net revenues: | |||||||||||||||
Product | $ | 721.2 | $ | 774.1 | $ | 801.2 | $ | 962.2 | |||||||
Service | 191.4 | 204.2 | 211.2 | 227.8 | |||||||||||
Total net revenues | 912.6 | 978.3 | 1,012.4 | 1,190.0 | |||||||||||
Cost of revenues: | |||||||||||||||
Product | 222.4 | 231.8 | 247.0 | 299.7 | |||||||||||
Service | 78.2 | 86.6 | 87.6 | 98.3 | |||||||||||
Total cost of revenues | 300.6 | 318.4 | 334.6 | 398.0 | |||||||||||
Gross margin | 612.0 | 659.9 | 677.8 | 792.0 | |||||||||||
Operating expenses: | |||||||||||||||
Research and development | 207.0 | 224.8 | 231.2 | 254.9 | |||||||||||
Sales and marketing | 192.4 | 202.3 | 204.7 | 257.7 | |||||||||||
General and administrative | 43.1 | 45.9 | 43.8 | 45.1 | |||||||||||
Amortization of purchased intangibles | 1.1 | 1.2 | 0.9 | 0.9 | |||||||||||
Restructuring charges (1) | 8.1 | 0.2 | 0.2 | 2.3 | |||||||||||
Acquisition-related charges (2) | — | 0.5 | 1.5 | 4.3 | |||||||||||
Total operating expenses | 451.7 | 474.9 | 482.3 | 565.2 | |||||||||||
Operating income | 160.3 | 185.0 | 195.5 | 226.8 | |||||||||||
Other income (expense), net | 1.4 | 4.0 | 0.2 | 4.8 | |||||||||||
Income before income taxes and noncontrolling interest | 161.7 | 189.0 | 195.7 | 231.6 | |||||||||||
Income tax (benefit) provision | (2.9 | ) | 58.7 | 61.4 | 41.5 | ||||||||||
Consolidated net income | 164.6 | 130.3 | 134.3 | 190.1 | |||||||||||
Adjust for net (income) loss attributable to noncontrolling interest | (1.5 | ) | 0.2 | 0.2 | 0.1 | ||||||||||
Net income attributable to Juniper Networks | $ | 163.1 | $ | 130.5 | $ | 134.5 | $ | 190.2 | |||||||
Net income per share attributable to Juniper Networks common stockholders: (3) | |||||||||||||||
Basic | $ | 0.31 | $ | 0.25 | $ | 0.26 | $ | 0.36 | |||||||
Diluted | $ | 0.30 | $ | 0.24 | $ | 0.25 | $ | 0.35 |
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