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Item 6. Selected Financial Data
The following tables present selected financial data for the five years ended October 31, 2008 (in
thousands, except per share data):
Years Ended October 31,
2008 2007 2006(1) 2005(2) 2004(3)
STATEMENT OF OPERATIONS DATA:
Net revenue $1,537,530 $ 981,791 $1,037,840 $1,201,220 $1,127,751
Cost of goods sold 988,695 735,034 825,476 786,378 749,680
Gross profit 548,835 246,757 212,364 414,842 378,071
Selling and marketing 167,380 130,652 139,250 156,668 119,257
General and administrative 171,440 150,432 156,191 125,976 101,215
Research and development 63,929 48,455 64,258 73,724 43,773
Business reorganization and related 4,478 17,467 — — —
Impairment of goodwill and long-lived
assets —— 15,608 — —
Depreciation and amortization 25,755 27,449 26,399 22,016 16,846
Total operating expenses 432,982 374,455 401,706 378,384 281,091
Income (loss) from operations 115,853 (127,698) (189,342) 36,458 96,980
Net income (loss) $ 97,097 $(138,406) $ (184,889) $ 35,314 $ 62,119
Earnings (loss) per share:
Basic $ 1.29 $ (1.93) $ (2.60) $ 0.51 $ 0.93
Diluted $ 1.28 $ (1.93) $ (2.60) $ 0.50 $ 0.91
Weighted average shares outstanding:
Basic 75,039 71,860 71,012 69,859 67,104
Diluted 75,943 71,860 71,012 70,882 68,589
As of October 31,
2008 2007 2006 2005 2004
BALANCE SHEET DATA:
Cash and cash equivalents $ 280,277 $ 77,757 $ 132,480 $ 107,195 $ 155,095
Working capital 358,355 186,362 281,327 365,878 397,359
Total assets 1,083,352 831,143 868,806 935,220 950,163
Line of credit 70,000 18,000 — — —
Total liabilities 468,234 359,989 318,414 249,390 320,365
Stockholders’ equity 615,118 471,154 550,392 685,830 629,798
(1) Net income includes a $63.5 million charge to income tax expense for an increase in our valuation allowance for deferred tax
assets, reflecting uncertain realization of future tax deductions.
(2) We incurred substantial product returns and other costs related to our Grand Theft Auto: San Andreas title, which was
temporarily re-rated ‘‘AO’’ from ‘‘M.’’ The resulting impact on our consolidated results of operations in fiscal 2005 was a
reduction of $24.5 million, $5.9 million, and $18.6 million from net revenue, cost of goods sold and income from operations,
respectively.
(3) We paid a $7.5 million civil penalty to the SEC in fiscal 2005 related to accounting practices that resulted in restatements of our
financial statements as of and for the years ended October 31, 2000 and 2002. Such penalties were accrued and expensed as of
October 31, 2004.
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