Citrix 2012 Annual Report Download - page 103

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CITRIX SYSTEMS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
F-37
Revenues by Geographic Location
The following table presents revenues by segment and geographic location, for the years ended:
December 31,
2012 2011 2010
(In thousands)
Net revenues:
Enterprise division
Americas $ 1,106,801 $ 993,062 $ 837,689
EMEA 691,111 576,953 519,828
Asia-Pacific 276,888 208,631 156,528
Total Enterprise division revenues 2,074,800 1,778,646 1,514,045
Online Services division
Americas 433,263 367,260 330,493
EMEA 63,484 50,711 23,258
Asia-Pacific 14,576 9,775 6,866
Total Online Services division revenues 511,323 427,746 360,617
Total net revenues $ 2,586,123 $ 2,206,392 $ 1,874,662
Export revenue represents shipments of finished goods and services from the United States to international customers,
primarily in Latin America and Canada. Shipments from the United States to international customers for 2012, 2011 and 2010
were $127.4 million, $106.0 million and $95.0 million, respectively.
12. DERIVATIVE FINANCIAL INSTRUMENTS
Derivatives Designated as Hedging Instruments
As of December 31, 2012, the Company’s derivative assets and liabilities primarily resulted from cash flow hedges
related to its forecasted operating expenses transacted in local currencies. A substantial portion of the Company’s overseas
expenses are and will continue to be transacted in local currencies. To protect against fluctuations in operating expenses and the
volatility of future cash flows caused by changes in currency exchange rates, the Company has established a program that uses
foreign exchange forward contracts to hedge its exposure to these potential changes. The terms of these instruments, and the
hedged transactions to which they relate, generally do not exceed twelve months and the maximum term is eighteen months.
Generally, when the dollar is weak, foreign currency denominated expenses will be higher, and these higher expenses will
be partially offset by the gains realized from the Company’s hedging contracts. Conversely, if the dollar is strong, foreign
currency denominated expenses will be lower. These lower expenses will in turn be partially offset by the losses incurred from
the Company’s hedging contracts. The change in the derivative component in accumulated other comprehensive loss includes
unrealized gains or losses that arose from changes in market value of the effective portion of derivatives that were held during
the period, and gains or losses that were previously unrealized but have been recognized in the same line item as the forecasted
transaction in current period net income due to termination or maturities of derivative contracts. This reclassification has no
effect on total comprehensive income or equity.
The total cumulative unrealized loss on cash flow derivative instruments was nil and $(5.2) million at December 31, 2012
and 2011, respectively, and is included in accumulated other comprehensive loss in the accompanying consolidated balance
sheets. The net unrealized loss as of December 31, 2012 is expected to be recognized in income over the next twelve months at
the same time the hedged items are recognized in income.
Derivatives not Designated as Hedges
A substantial portion of the Company’s overseas assets and liabilities are and will continue to be denominated in local
currencies. To protect against fluctuations in earnings caused by changes in currency exchange rates when remeasuring the
Company’s balance sheet, it utilizes foreign exchange forward contracts to hedge its exposure to this potential volatility.
These contracts are not designated for hedge accounting treatment under the authoritative guidance. Accordingly, changes
in the fair value of these contracts are recorded in other income (expense), net.