| FISCAL YEAR ENDED MARCH 31, | ||
|---|---|---|
| (UNAUDITED) | 2007 | 2006 |
| Total revenue | $ 3,943 | $ 3,772 |
| Total expenses before interest and taxes | 3,729 | 3,606 |
| Income before interest expense and income taxes | 214 | 166 |
| Non-GAAP adjustments | ||
| Purchased software amortization | 300 | 401 |
| Intangibles amortization | 58 | 51 |
| Restructuring and other | 201 | 88 |
| Charge for in-process research and development costs | 10 | 18 |
| Total non-GAAP adjustments | 569 | 558 |
| Operating income (pre-tax) | 783 | 724 |
| Interest expense, net | 60 | 41 |
| Interest on dilutive convertible bonds | 8 | 8 |
| Non-GAAP income before income taxes | 731 | 691 |
| Income tax expense | 232 | 177 |
| Non-GAAP net income1 | $ 499 | $ 514 |
| Diluted non-GAAP EPS1 | $ 0.88 | $ 0.85 |
| Number of shares used1 | 569 | 607 |
1Non-GAAP net income and the number of shares used in the computation of diluted operating EPS for all periods presented have been adjusted to reflect the dilutive impact of the Company’s 1.625% Convertible Senior Notes and stock awards outstanding. |
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| FISCAL YEAR ENDED MARCH 31, | ||
|---|---|---|
| (UNAUDITED) | 2007 | 2006 |
| Basic income per share | $ 0.22 | $ 0.27 |
| Non-GAAP adjustments, net of taxes | ||
| Acquisition amortization | 0.40 | 0.47 |
| Restructuring and other charges | 0.22 | 0.09 |
| Acquisition IPR&D | 0.01 | 0.02 |
| Interest on convertible bonds | 0.01 | 0.01 |
| Non-GAAP effective tax rate adjustments1 | 0.02 | (0.01) |
| Diluted Non-GAAP EPS | $ 0.88 | $ 0.85 |
1The Non-GAAP effective tax rate adjustment represents the impact on tax calculations caused by the changes in GAAP and Non-GAAP pretax amounts. |
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The tables above include financial measures for per share earnings that exclude the impact of certain items and therefore have not been calculated in accordance with U.S. generally accepted accounting principles (GAAP). Non-GAAP earnings per share excludes the following items: non-cash amortization of acquired technology and other intangibles, in process research and development charges, restructuring and other charges and the tax resulting from the repatriation of approximately $584 million of foreign cash and interest on dilutive convertible bonds (the convertible shares, rather than the interest, are more dilutive, thus the interest is added back and the shares increased to calculate non-GAAP earnings). Non-GAAP taxes are provided based on the estimated effective annual non-GAAP tax rate. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies. Non-GAAP financial measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. By excluding these items, non-GAAP financial measures facilitate management’s internal comparisons to the Company’s historical results, to competitors’ results, and to estimates made by securities analysts. Management uses these non-GAAP financial measures internally to evaluate its performance and they are key variables in determining management incentive compensation. The Company believes these non-GAAP financial measures are useful to investors in allowing for greater transparency of supplemental information used by management in its financial and operational decision-making. In addition, the Company has historically reported similar non-GAAP financial measures to its investors and believes that the inclusion of comparative numbers provides consistency in its financial reporting.