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77
Interest Rate Risk
Short-Term Investments and Fixed Income Securities
At November 30, 2012, we had debt securities classified as short-term investments of $2.1 billion. Changes in interest rates
could adversely affect the market value of these investments. The following table separates these investments, based on stated
maturities, to show the approximate exposure to interest rates (in millions):
Due within one year ............................................................................................................................................. $ 656.8
Due within two years............................................................................................................................................ 495.1
Due within three years.......................................................................................................................................... 678.5
Due after three years ............................................................................................................................................ 282.7
Total................................................................................................................................................................... $ 2,113.1
A sensitivity analysis was performed on our investment portfolio as of November 30, 2012. The analysis is based on an
estimate of the hypothetical changes in market value of the portfolio that would result from an immediate parallel shift in the yield
curve of various magnitudes.
The following tables present the hypothetical fair values of our debt securities classified as short-term investments assuming
immediate parallel shifts in the yield curve of 50 basis points (“BPS”), 100 BPS and 150 BPS. The analysis is shown as of
November 30, 2012 and December 2, 2011 (dollars in millions):
-150 BPS -100 BPS -50 BPS Fair Value
11/30/12 +50 BPS +100 BPS +150 BPS
2,138.4 2,136.6 2,129.3 2,113.1 2,094.6 2,076.5 2,058.5
-150 BPS -100 BPS -50 BPS Fair Value
12/2/2011 +50 BPS +100 BPS +150 BPS
1,935.5 1,930.6 1,922.1 1,909.9 1,896.4 1,883.0 1,869.9
Other Market Risk
Privately Held Long-Term Investments
The privately held companies in which we invest can still be considered in the start-up or development stages which are
inherently risky. The technologies or products these companies have under development are typically in the early stages and may
never materialize, which could result in a loss of a substantial part of our initial investment in these companies. The evaluation of
privately held companies is based on information that we request from these companies, which is not subject to the same disclosure
regulations as U.S. publicly traded companies, and as such, the basis for these evaluations is subject to the timing and accuracy
of the data received from these companies.
Marketable Equity Securities
We have immaterial exposure to equity price risk on our portfolio of marketable equity securities. As of November 30,
2012, our total equity holdings in publicly traded companies were valued at $0.2 million compared to $12.3 million at December 2,
2011. The decrease was primarily due to the disposal of certain of our equity holdings during fiscal 2012.
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