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Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2006
The changes in intangible assets for the year ended May 31, 2006 and the net book value of intangible assets at May 31, 2005 and 2006 were as follows:
(Dollars in millions)
Intangible Assets, Gross Accumulated Amortization Net Book Value Weighted
Average
Useful Life
May 31,
2005 Additions
May 31,
2006
May 31,
2005 Expense
May 31,
2006
May 31,
2005
May 31,
2006
Software support agreements and related
relationships $ 2,124 $ 825 $ 2,949 $ (88) $ (241) $ (329) $ 2,036 $ 2,620 10 years
Developed technology 800 536 1,336 (127) (206) (333) 673 1,003 5 years
Core technology 368 226 594 (30) (91) (121) 338 473 5 years
Customer relationships 257 118 375 (11) (30) (41) 246 334 10 years
Trademarks 84 33 117 (4) (15) (19) 80 98 7 years
Total $ 3,633 $ 1,738 $ 5,371 $ (260) $ (583) $ (843) $ 3,373 $ 4,528
The total amortization expense related to intangible assets was $583 million, $219 million and $36 million in fiscal 2006, 2005 and 2004, respectively. Estimated
future amortization expense related to intangible assets is $738 million in fiscal 2007, $727 million in fiscal 2008, $722 million in fiscal 2009, $615 million in
fiscal 2010, $431 million in fiscal 2011 and $1,295 million thereafter.
15. SEGMENT INFORMATION
FASB Statement No. 131, Disclosures about Segments of an Enterprise and Related Information, establishes standards for reporting information about operating
segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by
the chief operating decision maker, or decision making group, in deciding how to allocate resources and in assessing performance. Our chief operating decision
maker is our Chief Executive Officer. We are organized geographically and by line of business. While our Chief Executive Officer evaluates results in a number
of different ways, the line of business management structure is the primary basis for which the allocation of resources and financial results are assessed. We have
two businesses, software and services, which are further divided into five operating segments. Our software business is comprised of two operating segments:
(1) new software licenses and (2) software license updates and product support. Our services business is comprised of three operating segments: (1) consulting,
(2) On Demand and (3) education.
The new software license line of business is engaged in the licensing of database and middleware software as well as applications software. Database and
middleware software includes database management software, application server software, analytics, development tools and collaboration software. Applications
software provides enterprise information that enables companies to manage their business cycles and provide intelligence in functional areas such as financials,
human resources, maintenance management, manufacturing, marketing, order fulfillment, product lifecycle management, procurement, projects, sales, services
and supply chain planning. The software license updates and product support line of business provides customers with rights to unspecified software product
upgrades and maintenance releases, internet access to technical content, as well as internet and telephone access to technical support personnel during the support
period.
The consulting line of business provides services to customers in the design, implementation, deployment and upgrade of our database, middleware and
applications software. On Demand includes Oracle On Demand and Advanced Customer Services. Oracle On Demand provides multi-featured software and
hardware management and maintenance services for our database, middleware and applications software. Advanced Customer Services provide customers
configuration and performance analysis, personalized support and annual on-site technical services. The education line of business provides instructor led, media
based and internet based training in the use of our database, middleware and applications software.
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Source: ORACLE CORP, 10-K, July 21, 2006 Powered by Morningstar® Document Research℠