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RESULTS OF OPERATIONS
Revenue
The following table presents the breakdown of revenue between product and service (in millions, except percentages):
Years Ended 2015 vs. 2014 2014 vs. 2013
July 25,
2015
July 26,
2014
July 27,
2013
Variance
in Dollars
Variance
in Percent
Variance
in Dollars
Variance
in Percent
Revenue:
Product ................................ $ 37,750 $ 36,172 $ 38,029 $ 1,578 4.4% $ (1,857) (4.9)%
Percentage of revenue ................. 76.8% 76.7% 78.2%
Service ................................ 11,411 10,970 10,578 441 4.0% 392 3.7 %
Percentage of revenue ................. 23.2% 23.3% 21.8%
Total .............................. $ 49,161 $ 47,142 $ 48,607 $ 2,019 4.3% $ (1,465) (3.0)%
We manage our business primarily on a geographic basis, organized into three geographic segments. Our revenue, which includes
product and service for each segment, is summarized in the following table (in millions, except percentages):
Years Ended 2015 vs. 2014 2014 vs. 2013
July 25,
2015
July 26,
2014
July 27,
2013
Variance
in Dollars
Variance
in Percent
Variance
in Dollars
Variance
in Percent
Revenue:
Americas .............................. $ 29,655 $ 27,781 $ 28,639 $ 1,874 6.7 % $ (858) (3.0)%
Percentage of revenue ................. 60.3% 58.9% 58.9%
EMEA ................................. 12,322 12,006 12,210 316 2.6 % (204) (1.7)%
Percentage of revenue ................. 25.1% 25.5% 25.1%
APJC .................................. 7,184 7,355 7,758 (171) (2.3)% (403) (5.2)%
Percentage of revenue ................. 14.6% 15.6% 16.0%
Total .............................. $ 49,161 $ 47,142 $ 48,607 $ 2,019 4.3 % $ (1,465) (3.0)%
Fiscal 2015 Compared with Fiscal 2014
For fiscal 2015, as compared with fiscal 2014, total revenue increased by 4%, as product and service revenue each increased by
4%. Our total revenue grew in our Americas and EMEA geographic segments, while revenue declined in the APJC segment. The
emerging countries of BRICM, in the aggregate, experienced a 4% product revenue decline, with declines in China and Russia
partially offset by increases in the other three BRICM countries.
We conduct business globally in numerous currencies. The direct effect of foreign currency fluctuations on revenue has not been
material because our revenue is primarily denominated in U.S. dollars. However, if the U.S. dollar strengthens relative to other
currencies, as was the case during fiscal 2015, such strengthening could have an indirect effect on our revenue to the extent it
raises the cost of our products to non-U.S. customers and thereby reduces demand. A weaker U.S. dollar could have the opposite
effect. However, the precise indirect effect of currency fluctuations is difficult to measure or predict because our revenue is
influenced by many factors in addition to the impact of such currency fluctuations. Our revenue in fiscal 2015, and in particular
our revenue for EMEA and APJC, was adversely affected by the depreciation of certain currencies relative to the U.S. dollar
especially in certain emerging countries, although the indirect effects are difficult to measure.
In addition to the impact of macroeconomic factors, including a reduced IT spending environment and reductions in spending by
government entities, revenue by segment in a particular period may be significantly impacted by several factors related to revenue
recognition, including the complexity of transactions such as multiple-element arrangements; the mix of financing arrangements
provided to our channel partners and customers; and final acceptance of the product, system, or solution, among other factors. In
addition, certain customers tend to make large and sporadic purchases, and the revenue related to these transactions may also be
affected by the timing of revenue recognition, which in turn would impact the revenue of the relevant segment. As has been the
case in certain of our emerging countries from time to time, customers require greater levels of financing arrangements, service,
and support, and these activities may occur in future periods, which may also impact the timing of the recognition of revenue.
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