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Morningstar® Document Research℠
FORM 10-K
ORACLE CORP - ORCL
Filed: June 28, 2011 (period: May 31, 2011)
Annual report with a comprehensive overview of the company

Table of contents

  • Page 1
    Morningstar Document Research ® ℠FORM 10-K ORACLE CORP - ORCL Filed: June 28, 2011 (period: May 31, 2011) Annual report with a comprehensive overview of the company

  • Page 2
    ... sale price of common stock as reported by the NASDAQ Global Select Market on November 30, 2010, which is the last business day of the registrant's most recently completed second fiscal quarter. This calculation does not reflect a determination that Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 3
    ...,000. Documents Incorporated by Reference: Portions of the registrant's definitive proxy statement relating to its 2011 annual stockholders' meeting are incorporated by reference into Part III of this Annual Report on Form 10-K where indicated. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 4
    ... Directors, Executive Officers and Corporate Governance Executive Compensation Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters Certain Relationships and Related Transactions, and Director Independence Principal Accounting Fees and Services Market...

  • Page 5
    ... from time to time with the Securities and Exchange Commission (the SEC), including the Quarterly Reports on Form 10-Q to be filed by us in our fiscal year 2012, which runs from June 1, 2011 to May 31, 2012. 1 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 6
    ...-looking events we discuss in this Annual Report not to occur. You should not place undue reliance on these forward-looking statements, which reflect our opinions only as of the date of this Annual Report. 2 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 7
    ...: (1) consulting, (2) Cloud Services and (3) education. Our software, hardware systems, and services businesses represented 68%, 19%, and 13% of our total revenues, respectively, in fiscal 2011 and 77%, 9% and 14%, respectively, in fiscal 2010. Prior to our acquisition of Sun Microsystems, Inc. (Sun...

  • Page 8
    ... compress data. Oracle Exadata is designed to enable customers to consolidate databases, manage a greater volume of data, dramatically improve query response times and further reduce costs by using fewer IT resources. 4 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 9
    ... products represented 72% of our new software license revenues in each of fiscal 2011, 2010 and 2009. Database Software Oracle Database software is the world's most popular enterprise database software. It is designed to enable the secure storage, retrieval and manipulation of all forms of data...

  • Page 10
    Table of Contents analytics, and unstructured data in the form of XML files, office documents, images, video, spatial and other specialized forms of data such as human genomic and medical data. Oracle Database software is used for a variety of purposes, including online transaction processing ...

  • Page 11
    ...• Application Server and Application Grid; • Service-Oriented Architecture and Business Process Management; • Business Intelligence; • Identity and Access Management; • Data Integration; • Content Management; • Portals and User Interaction; and • Development Tools. Application Server...

  • Page 12
    ... query and analysis server; Oracle Essbase, an online analytical processing (OLAP) server; Oracle BI Publisher, a self-service production and operational reporting tool; and Oracle Real-Time Decisions, a real-time data classification and optimization solution. Users can access these tools...

  • Page 13
    ... of customers and the Java community. We also offer a selection of software products that are complementary to our database and middleware products, including Oracle Enterprise Manager management tools and Oracle VM server virtualization software. 9 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 14
    .... With their tailored user experience and embedded analytical capabilities, Oracle Fusion Applications are designed to increase user productivity and allow customers to manage functions across different environments more effectively. Using a SOA approach, Oracle Fusion Applications are engineered to...

  • Page 15
    ..., purchasing, accounts receivable and payable, general ledger, cash and treasury management, travel and expense management, human resources, payroll, benefits, and talent management. Our ERP applications combine business functionality with innovative technologies such as self-service applications...

  • Page 16
    ... of web commerce software and related subscription-based commerce optimization applications. The ATG solution is designed to enable enterprises to create an online customer experience with merchandising, marketing, content personalization, automated recommendations, and live-help services. By...

  • Page 17
    ... located in our global support centers, as well as internet access to technical content through "My Oracle Support." Software license updates and product support contracts are generally priced as a percentage of the net new software license fees. Substantially all of our customers purchase software...

  • Page 18
    ...updates for the software components that are essential to the functionality of our server and storage products, such as Oracle Solaris, and can include product repairs, maintenance services, and technical support services. We continue to focus on 14 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 19
    ... services. Cloud Services revenues represented 4% of total revenues in fiscal 2011 and 3% of total revenues in each of fiscal 2010 and 2009. Education We provide training to customers, partners and employees as a part of our mission of accelerating the adoption and use of our software and hardware...

  • Page 20
    ..., educational information, technical services, marketing and sales support, the Oracle Partner Network program extends our market reach by providing our partners with the resources they need to be successful in delivering solutions to customers globally. The majority of our hardware systems products...

  • Page 21
    ...software and hardware markets in which we compete. We plan to continue to dedicate a significant amount of resources to research and development efforts to maintain and improve our current product and services offerings. 17 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 22
    ... Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to reports filed pursuant to Sections 13(a) and 15(d) of the Securities Exchange Act of 1934, as amended, are available, free of charge, on our Investor Relations web site at www.oracle.com...

  • Page 23
    ... and Chief Accounting Officer from April 2007 to February 2008. Prior to joining us, he served as Intuit Inc.'s Director of Accounting from August 2005 to March 2007. He also spent 14 years with Arthur Andersen LLP, most recently as a partner. 19 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 24
    ... growth and profitability. These factors generally have the strongest effect on our sales of new software licenses, hardware systems products, hardware systems support and related services and, to a lesser extent, also may affect our renewal rates for software license updates and product support. We...

  • Page 25
    ... support services in a timely manner or to position and/or price our products and services to meet market demand, customers may not buy new software licenses or hardware systems products or purchase or renew software license updates and product support or hardware systems support contracts. Renewals...

  • Page 26
    ... add new functionality, acquire competitive products, reduce prices or form strategic alliances with other companies. Vendors that offer SaaS, cloud or BPO solutions may persuade our customers not to purchase our products. We may also face increasing competition from open source software initiatives...

  • Page 27
    ... number of customers decline to renew software license updates and product support contracts and hardware systems support contracts, if we are unable to sell the acquired products to our customer base or if contract models of an acquired company do not allow us to recognize revenues on a timely...

  • Page 28
    ...to our acquisition of Sun in a timely manner or at all due to a number of factors, including: • our relative inexperience in managing a hardware systems business and related processes or the unplanned departures of some important employees could adversely impact our ability to successfully run our...

  • Page 29
    ... of revenues, and we may not achieve our profit margin levels that we attained prior to our acquisition of Sun; • we face a greater risk of potential write-downs and impairments of inventory, higher warranty expenses than we had historically encountered in our existing software and services...

  • Page 30
    ... generally outside of our control. The future operating results of our hardware systems business will depend on our ability to manage our component inventory to meet the demands of our hardware systems customers and to avoid component inventory write-downs. We depend on suppliers to design, develop...

  • Page 31
    ...employees. Members of our senior management team have left Oracle over the years for a variety of reasons, and we cannot assure you that there will not be additional departures, which may be disruptive to our operations. 27 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 32
    ... services. Despite testing prior to their release, software products frequently contain errors or security flaws, especially when first introduced or when new versions are released. The detection and correction of any security flaws can be time 28 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 33
    ...publicly report security breaches of our services, which could adversely impact future business prospects for those services. We may not receive significant revenues from our current research and development efforts for several years, if at all. Developing software and hardware products is expensive...

  • Page 34
    ... tax could be limited, which could unfavorably affect our provision for income taxes and effective tax rate. In addition, changes by any rating agency to our outlook or credit rating could negatively affect the value of both our debt and equity securities and increase the interest amounts we pay...

  • Page 35
    ... the services; • demand for these services may not meet our expectations and may be affected by customer and media concerns about security risks, international transfers of data, government or other third party access to data, and/or use of outsourced services providers more generally; and...

  • Page 36
    ...measures for our stock, our credit ratings and market trends unrelated to our performance. A significant drop in our stock price could also expose us to the risk of securities class actions lawsuits, which could result in substantial costs and divert management's attention and resources, which could...

  • Page 37
    ...cash requirements for acquisitions and dividend payments, our debt repayment obligations or repurchases of our debt, our stock price, and economic and market conditions. Our stock repurchases may be effected from time to time through open market purchases or pursuant to a Rule 10b5-1 plan. Our stock...

  • Page 38
    ... Contents Stock Performance Graph and Cumulative Total Return The graph below compares the cumulative total stockholder return on our common stock with the cumulative total return of the S&P 500 Index and the S&P Information Technology Index for each of the last five fiscal years ended May 31, 2011...

  • Page 39
    ... the last five fiscal years. This selected financial data should be read in conjunction with the consolidated financial statements and related notes included in Item 15 of this Annual Report. Over the last five fiscal years, we have acquired a number of companies including Sun Microsystems, Inc. in...

  • Page 40
    ... of customers that renew their software license updates and product support contracts, and due to our acquisitions, which should allow us to grow our profits and continue to make investments in research and development. 36 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 41
    ... the hardware systems business as a result of our acquisition of Sun. Support margins during fiscal 2011 were 86% and accounted for 70% of our total margins. Our software license update and product support margins have been affected by fair value adjustments relating to support obligations assumed...

  • Page 42
    ... are designed to securely manage, protect, archive and restore customers' mission critical data assets and consist of tape, disk, hardware-related software including file systems software, back-up and archive software and storage management software, and networking for mainframe and open systems...

  • Page 43
    ...are renewed with us following an acquisition, we will recognize the revenues for the full values of the hardware systems support contracts over the support periods. Services Business Our services business consists of consulting, Cloud Services and education. As a result of our acquisition of Sun, we...

  • Page 44
    Table of Contents designed to provide comprehensive software and hardware management and maintenance services for customers hosted at our Oracle data center facilities, select partner data centers or physically on-site at customer facilities. Advanced Customer Services provides support services, ...

  • Page 45
    ... support contracts are generally priced as a percentage of the net new software license fees. Substantially all of our customers renew their software license updates and product support contracts annually. 41 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 46
    ...and technical support services. Hardware systems support contracts are entered into at the customer's option and are recognized ratably over the contractual term of the arrangements. Revenue Recognition for Multiple-Element Arrangements-Hardware Systems Products and Hardware Systems Related Services...

  • Page 47
    ... hardware systems products, hardware systems support, new software licenses, software license updates and product support, consulting, Cloud Services and education. In such arrangements, we first allocate the total arrangement consideration based on the relative selling prices of the software group...

  • Page 48
    ... the term of the service period, which is generally one year or less. Education revenues are also a part of our services business and include instructor-led, media-based and internet-based training in the use of our software and hardware products. Education revenues are recognized as the classes or...

  • Page 49
    ... within 90 days of the contracts' dates of execution and we classify the proceeds from these sales as cash flows from operating activities in our consolidated statements of cash flows. We account for the sales of these receivables as "true sales" as defined in ASC 860, Transfers and Servicing, as we...

  • Page 50
    ... uncertain. Examples of critical estimates in valuing certain of the intangible assets we have acquired include but are not limited to: • future expected cash flows from software license sales, hardware systems product sales, support agreements, consulting contracts, other customer contracts and...

  • Page 51
    ...to the difference. Determining the fair value of a reporting unit involves the use of significant estimates and assumptions. These estimates and assumptions include revenue growth rates and operating margins used to calculate projected future cash flows, risk-adjusted discount rates, future economic...

  • Page 52
    ... in income tax returns filed during the subsequent year. Adjustments based on filed returns are generally recorded in the period when the tax returns are filed and the global tax implications are known, which can materially impact our effective tax rate. The amount of income tax we pay is subject...

  • Page 53
    ... representative of future stock price trends than historical volatility. In order to determine the estimated period of time that we expect employees to hold their stock options, we have used historical rates of 49 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 54
    ... of Contents employee groups by seniority of job classification. Our expected dividend rate is based upon an annualized dividend yield based on the per share dividend declared by our Board of Directors. The aforementioned inputs entered into the option valuation model we use to fair value our stock...

  • Page 55
    ... relative mix of products sold would have been different; and • although substantially all of our customers, including customers from acquired companies, renew their software license updates and product support contracts when the contracts are eligible for renewal and we strive to renew hardware...

  • Page 56
    ... in total operating expenses in fiscal 2011 was due to a full year of expense contributions from Sun to our fiscal 2011 operating results, including increased expenses pertaining to hardware systems products sold and related hardware systems support offerings, additional employee related expenses...

  • Page 57
    ... license updates and product support(1) deferred revenues Hardware systems support deferred revenues (2) Hardware systems products expenses (3) Amortization of intangible assets (4)(6) Acquisition related and other (5) Restructuring (6) Stock-based compensation (7) Income tax effects (1) $ 2011...

  • Page 58
    ...132 421 15 $ 436 (5) (6) Sales and marketing Software license updates and product support Hardware systems products Hardware systems support Services Research and development General and administrative Subtotal Acquisition related and other Total stock-based compensation $ 2011 $ 87 14 2 5 16...

  • Page 59
    ... program costs and amortization of intangible assets. Year Ended May 31, Percent Change Percent Change Actual Constant 2010 Actual Constant (Dollars in millions) New Software License Revenues: Americas EMEA Asia Pacific Total revenues Expenses: (1) Sales and marketing Stock-based compensation...

  • Page 60
    ... new software license expenses increased in fiscal 2010 primarily due to higher variable compensation expenses and related payroll taxes resulting from higher revenues and due to additional operating expenses as a result of the Sun acquisition. These increases were partially offset by lower travel...

  • Page 61
    ... access to technical content as well as internet and telephone access to technical support personnel in our global support centers. Expenses associated with our software license updates and product support line of business include the cost of providing the support services, largely personnel related...

  • Page 62
    Table of Contents On a constant currency basis, total software license updates and product support expenses increased due to an increase in salaries, variable compensation and benefits expenses that were primarily related to a full year's contribution from Sun and certain other headcount increases ...

  • Page 63
    ...Constant (Dollars in millions) 2011 Hardware Systems Products Revenues: Americas EMEA Asia Pacific Total revenues Expenses: (1) Hardware systems products (1) Sales and marketing Stock-based compensation (2) Amortization of intangible assets Total expenses Total Margin Total Margin % % Revenues by...

  • Page 64
    ... associated with hardware systems support contracts and customer relationships obtained from the Sun acquisition. Year Ended May 31, Percent Change 2010 Actual Constant (Dollars in millions) 2011 Hardware Systems Support Revenues: Americas EMEA Asia Pacific Total revenues Expenses: (1) Hardware...

  • Page 65
    ...services are designed to provide comprehensive software and hardware management and maintenance services for customers hosted at our Oracle data center facilities, select partner data centers or physically on-site at customer facilities. Advanced 61 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 66
    ... employee related expenses. On a constant currency basis, Cloud Services margin increased primarily due to expense reductions in our legacy Cloud Services operations, while margin as a percentage of revenues was flat. 62 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 67
    ... internet-based training in the use of our software and hardware products. Education expenses primarily consist of personnel related expenditures, facilities and external contractor costs. Year Ended May 31, 2010 (Dollars in millions) Education Revenues: Americas EMEA Asia Pacific Total revenues...

  • Page 68
    ... related expenditures for information technology, finance, legal and human resources support functions. Year Ended May 31, Percent Change Percent Change Actual Constant 2010 Actual Constant (Dollars in millions) General and administrative Stock-based compensation Total expenses % of Total Revenues...

  • Page 69
    ... result of our acquisition of Sun. To a lesser extent, we also incurred expenses associated with other Oracle-based plans, which our management approved, committed to and initiated in order to restructure and 65 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 70
    ... 2011 due to larger average cash, cash equivalents and marketable securities balances and other income, net increased in fiscal 2011 as a result of gains recognized on the sale of certain equity investments. 66 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 71
    ... in fiscal 2010 but were partially offset by gains due to favorable changes in the values of our marketable securities that we classify as trading that were held to support our deferred compensation plan obligations. Provision for Income Taxes: Our effective tax rate in all periods is the result...

  • Page 72
    ...and marketable securities balances was partially offset by $5.6 billion of net cash used for our acquisition of Sun and other companies, the repayment of $700 million of Sun's legacy convertible notes, repurchases of our common stock, and the payment of cash dividends to our stockholders. Days sales...

  • Page 73
    ... Note 2 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report for additional information regarding our acquisitions) and a decrease in cash used to purchase marketable securities (net of proceeds received from sales and maturities), partially offset by an increase in...

  • Page 74
    Table of Contents days of the contracts' dates of execution. We record the transfers of amounts due from customers to financial institutions as sales of financial assets because we are considered to have surrendered control of these financial assets. We financed $1.5 billion, $1.2 billion and $1.4 ...

  • Page 75
    ... may be effected from time to time through open market purchases or pursuant to a Rule 10b5-1 plan. Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time. Cash Dividends: In fiscal 2011, we declared and paid cash dividends of $0.21 per share that totaled...

  • Page 76
    ...the table below by our acquisition of Sun during the third quarter of fiscal 2010, which added a significant amount of revenues and expenses to our results of operations in comparison to our historical operating results. 72 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 77
    ...of the current market price. In recent years, our stock repurchase program has more than offset the dilutive effect of our stock-based compensation program; however, we may reduce the level of our stock repurchases in the future as we may use our available cash for acquisitions, to pay dividends, to...

  • Page 78
    ... rate movements generally do not materially affect the valuation of our debt security investments. Substantially all of our marketable securities are designated as available-for-sale. We generally do not use our investments for trading purposes. 74 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 79
    ...) and short-term borrowings pursuant to our 2011 Credit Agreements would not impact the interest expense we recognize in our consolidated statements of operations. We have entered into certain fixed to variable interest rate swap agreements to manage the interest rate and related fair value of our...

  • Page 80
    ...of cash, cash equivalents and marketable securities that we report in U.S. Dollars for a significant portion of the cash held by these subsidiaries is subject to translation variance caused by changes in foreign currency exchange rates as of the end of each respective reporting period (the offset to...

  • Page 81
    ... and design, our implementation of the controls and the effect of the controls on the information generated for use in this Annual Report on Form 10-K. In the course of the controls evaluation, we reviewed data errors or control problems identified and 77 Financial Statements and Supplementary Data...

  • Page 82
    ... preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles. Based on the results of our evaluation, our management concluded that our internal control over financial reporting was effective as of May 31, 2011. We reviewed the...

  • Page 83
    ... with policies or procedures may deteriorate. Because of the inherent limitations in a cost effective control system, misstatements due to error or fraud may occur and not be detected. Item 9B. None. 79 Other Information Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 84
    ... to be contained in our 2011 Proxy Statement under the sections entitled "Security Ownership of Certain Beneficial Owners and Management" and "Executive Compensation-Equity Compensation Plan Information". Item 13. Certain Relationships and Related Transactions, and Director Independence The...

  • Page 85
    ... 2009 Statements of Equity for the years ended May 31, 2011, 2010 and 2009 Statements of Cash Flows for the years ended May 31, 2011, 2010 and 2009 Notes to Consolidated Financial Statements 2. Financial Statement Schedules The following financial statement schedule is filed as a part of this report...

  • Page 86
    ...02* Oracle Corporation Employee Stock Purchase Plan (1992), as amended and restated as of October 1, 2009 10-Q 000-51788 10.01 3/23/09 Oracle Corporation 10-K 000-51788 10.02 7/1/10 Oracle Corporation 82 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 87
    ...and Restated 2000 Long-Term Equity Incentive Plan 10.06* Form of Stock Option Agreement for Oracle Corporation Amended and Restated 1993 Directors' Stock Plan 10.07* Form of Indemnification Agreement for Directors and Executive Officers 10.08 Form of Commercial Paper Dealer Agreement relating to the...

  • Page 88
    ...Statements of Equity for the years ended May 31, 2011, 2010 and 2009, (iv) Consolidated Statements of Cash Flows for the years ended May 31, 2011, 2010 and 2009, (v) Notes to Consolidated Financial Statements and (vi) Financial Statement Schedule II Indicates management contract or compensatory plan...

  • Page 89
    ... of Oracle Corporation at May 31, 2011 and 2010, and the consolidated results of its operations and its cash flows for each of the three years in the period ended May 31, 2011, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial statement...

  • Page 90
    ... regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the...

  • Page 91
    Table of Contents ORACLE CORPORATION CONSOLIDATED BALANCE SHEETS As of May 31, 2011 and 2010 May 31, (in millions, except per share data) Current assets: Cash and cash equivalents Marketable securities Trade receivables, net of allowances for doubtful accounts of $372 and $305 as of May 31, 2011 ...

  • Page 92
    Table of Contents ORACLE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS For the Years Ended May 31, 2011, 2010 and 2009 Year Ended May 31, 2010 (in millions, except per share data) Revenues: New software licenses Software license updates and product support Software revenues Hardware systems ...

  • Page 93
    Table of Contents ORACLE CORPORATION CONSOLIDATED STATEMENTS OF EQUITY For the Years Ended May 31, 2011, 2010 and 2009 Common Stock and Additional Paid in Capital Number of Shares Amount 5,150 76 3 - - (226) - - 2 5,005 35) (171) (6) 6,135 5,923 60 3 - - (43) - - 1 - - - - - 5,026 32 480 26 8,...

  • Page 94
    Table of Contents ORACLE CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS For the Years Ended May 31, 2011, 2010 and 2009 Year Ended May 31, 2010 (in millions) Cash Flows From Operating Activities: Net income Adjustments to reconcile net income to net cash provided by operating activities: ...

  • Page 95
    ... affect total revenues, operating income or net income. General and administrative expenses as presented in our consolidated statements of operations for fiscal 2011 included a benefit of $120 million related to the recovery of legal costs that reduced our expenses in this period. Use of Estimates...

  • Page 96
    ... software and hardware related services including consulting, Cloud Services and education revenues. Revenue Recognition for Software Products and Software Related Services (Software Elements) New software license revenues represent fees earned from granting customers licenses to use our database...

  • Page 97
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 software license updates and product support contracts and other software related services whereby software license delivery is followed by the subsequent or contemporaneous delivery of the ...

  • Page 98
    ... hardware systems products, hardware systems support, new software licenses, software license updates and product support, consulting, Cloud Services and education. In such arrangements, we first allocate the total arrangement consideration based on the relative selling prices of the software group...

  • Page 99
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 Other Revenue Recognition Policies Applicable to Software and Nonsoftware Elements Many of our software arrangements include consulting implementation services sold separately under consulting ...

  • Page 100
    ... of consideration transferred and the net of the acquisition date fair values of the assets acquired and the liabilities assumed. While we use our best estimates and assumptions as a part of the purchase 96 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 101
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 price allocation process to accurately value assets acquired and liabilities assumed at the acquisition date, our estimates are inherently uncertain and subject to refinement. As a result, ...

  • Page 102
    ... of our payment terms for the significant majority of our customer contracts and by the diversification of our customer base. No single customer accounted for 10% or more of our total revenues in fiscal 2011, 2010 or 2009. Inventories Inventories are stated at the lower of cost or market value. Cost...

  • Page 103
    ... fiscal 2011, 2010 and 2009, we used derivative financial instruments to manage foreign currency and interest rate risks. We account for these instruments in accordance with ASC 815, Derivatives and Hedging, 99 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 104
    ... (expense), net in the accompanying consolidated statements of operations were $11 million, $(149) million and $(65) million in fiscal 2011, 2010 and 2009, respectively. Stock-Based Compensation We account for share-based payments, including grants of employee stock options and restricted stock...

  • Page 105
    .... Year Ended May 31, 2010 (in millions) Transitional and other employee related costs Stock-based compensation Professional fees and other, net Business combination adjustments, net Total acquisition related and other expenses Non-Operating Income (Expense), net $ 129 10 66 3 $ 208 2011 $ 66...

  • Page 106
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 Included in our non-operating income (expense), net for fiscal 2010 was a foreign currency remeasurement loss of $81 million resulting from the designation of our Venezuelan subsidiary as "...

  • Page 107
    ... ATG in our consolidated financial statements from the date of acquisition. The total preliminary purchase price for ATG was approximately $1.0 billion, which consisted of approximately $990 million in cash and $16 million for the fair value of stock options and restricted stock-based awards assumed...

  • Page 108
    ... by adding Sun's existing hardware systems business and broadening our software and services offerings. We have included the financial results of Sun in our consolidated financial statements from the date of acquisition. For fiscal 2010, we estimate that Sun's contribution to our total revenues was...

  • Page 109
    ...NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 approximately $1.2 billion in cash, $1 million for the fair value of stock options and restricted stock-based awards assumed and $13 million for transaction costs. In allocating the total purchase price for these acquisitions based...

  • Page 110
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 The amortized principal amounts of our cash, cash equivalents and marketable securities approximated their fair values at May 31, 2011 and 2010. We use the specific identification method to ...

  • Page 111
    ... market data. Our discounted cash flow techniques used observable market inputs such as LIBOR-based yield curves, among others. Our cash and cash equivalents, marketable securities and derivative financial instruments are recognized and measured at fair value in our consolidated financial statements...

  • Page 112
    ..., 2010 Expense 2011 Intangible Assets, Net May 31, May 31, 2010 2011 Weighted Average Useful Life 9 years 7 years 5 years 5 years 7 years 7 years N.A. (Dollars in millions) Software support agreements and related relationships Hardware systems support agreements and related relationships Developed...

  • Page 113
    ... segment and our services business for fiscal 2011 and 2010 were as follows: Software License Updates and Product Support New (in millions) Software Licenses Hardware Systems Support Services Total Balances as of May 31, 2009 Goodwill from acquisitions (1) Goodwill adjustments Balances as of...

  • Page 114
    ... and any of our commercial paper notes. Separately, shortly after the closing of our acquisition of Sun we repaid, in full, $700 million of Sun's legacy convertible notes in the third quarter of fiscal 2010. 110 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 115
    ... named therein (the 2006 Credit Agreement) expired pursuant to its terms. No debt was outstanding pursuant to the 2006 Credit Agreement as of its date of expiration. 111 $ 1,150 1,250 - 1,500 2,000 10,000 $15,900 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 116
    ...estimates of executing these acquisition related restructuring plans will be recorded as an adjustment to goodwill indefinitely. Increases to the estimates of the acquisition related restructuring plans will be recorded to operating expenses. 112 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 117
    ...to Date $ 69 57 111 56 488 781 Total Expected Program Costs $ 88 89 120 74 660 1,031 (in millions) Sun Restructuring Plan(1) New software licenses Software license updates and product support Hardware systems business Services General and administrative and other Total Sun Restructuring Total other...

  • Page 118
    ... undelivered consulting or other services. In connection with the purchase price allocations related to our acquisitions, we have estimated the fair values of the software license updates and product support obligations and hardware systems support obligations assumed from our acquired companies. We...

  • Page 119
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 11. DERIVATIVE FINANCIAL INSTRUMENTS Interest Rate Swap Agreements Fair Value Hedges In September 2009, we entered into interest rate swap agreements that have the economic effect of ...

  • Page 120
    ... and type of cross-currency exposures that we enter into, the currency exchange rates associated with these exposures and changes in those rates, the net realized and unrealized gains or losses on foreign currency forward contracts to offset these exposures and other factors. We neither use these...

  • Page 121
    ... exchange trades, taxes, import licenses and letters of credit on behalf of parties with whom we conduct business. Such agreements have not had a material effect on our results of operations, financial position or cash flows. 117 $453 15 7 3 3 $481 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 122
    ... may be effected from time to time through open market purchases or pursuant to a Rule 10b5-1 plan. Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time. Dividends on Common Stock During fiscal 2011, our Board of Directors declared cash dividends of $0.21...

  • Page 123
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 Restated 2000 Long-Term Equity Incentive Plan (the 2000 Plan). Upon approval, the termination date of the 2000 Plan was extended by ten years and the number of authorized shares of stock that ...

  • Page 124
    ... between our closing stock price on the last trading day of fiscal 2011 of $34.22 and the exercise prices for all in-the-money options outstanding, excluding tax effects. The unrecognized compensation expense calculated under the fair value method for shares expected to vest (unvested shares net of...

  • Page 125
    ... consolidated statements of operations: Year Ended May 31, 2010 (in millions) Sales and marketing Software license updates and product support Hardware systems products Hardware systems support Services Research and development General and administrative Acquisition related and other Total stock...

  • Page 126
    ... total tax benefits received, we classified excess tax benefits from stock-based compensation of $215 million, $110 million and $194 million as cash flows from financing activities rather than cash flows from operating activities for fiscal 2011, 2010 and 2009, respectively. Employee Stock Purchase...

  • Page 127
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 The provision for income taxes consisted of the following: Year Ended May 31, 2010 (Dollars in millions) Current provision: Federal State Foreign Total current provision Deferred provision (...

  • Page 128
    ...on stock Acquired intangible assets Other Total deferred tax liabilities Deferred tax assets: Accruals and allowances Employee compensation and benefits Differences in timing of revenue recognition Depreciation and amortization Tax credit and net operating loss carryforwards Other Total deferred tax...

  • Page 129
    ... Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 At May 31, 2011, we had federal net operating loss carryforwards of approximately $751 million. These losses expire in various years between fiscal 2012 and fiscal 2030, and are subject to limitations...

  • Page 130
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 $285 million ($181 million net of offsetting tax benefits) in the next 12 months, related primarily to transfer pricing. Other issues are related to years with expiring statutes of limitation. ...

  • Page 131
    ... and internet-based training in the use of our software and hardware products. We do not track our assets by operating segments. Consequently, it is not practical to show assets by operating segments' results. 127 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 132
    ... TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 The following table presents a summary of our businesses' and operating segments' results: Year Ended May 31, 2010 (in millions) New software licenses: (1) Revenues Sales and distribution expenses (2) Margin Software license updates...

  • Page 133
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 (1) Operating segment revenues generally differ from the external reporting classifications due to certain software license products that are classified as service revenues for management ...

  • Page 134
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 Geographic Information Disclosed in the table below is geographic information for each country that comprised greater than three percent of our total revenues for fiscal 2011, 2010 or 2009. As ...

  • Page 135
    ... with prospective economic advantage. Oracle alleged that SAP unlawfully accessed Oracle's Customer Connection support website and improperly took and used Oracle's intellectual property, including software code and knowledge management solutions. On June 1, 2007, Oracle filed its First Amended...

  • Page 136
    Table of Contents ORACLE CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued) May 31, 2011 Based on information obtained during discovery, Oracle amended its complaint several times. Oracle filed its operative complaint, Oracle's Fourth Amended Complaint, on August 18, 2009. The SAP ...

  • Page 137
    ... false and fraudulent statements to the GSA in 1997-98 regarding Oracle's commercial pricing practices, discounts provided to Oracle's commercial customers, and discounts provided to government purchasers. The government alleges that Oracle also improperly manipulated commercial sales to avoid the...

  • Page 138
    ... Write-offs Translation Adjustments and Other Ending Balance Allowances for Doubtful Trade Receivables Year Ended: May 31, 2009 May 31, 2010 May 31, 2011 $ $ $ 303 270 305 134 118 143 164 (128) (92) (113) (23) (16) 16 $ 270 $ 305 $ 372 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 139
    ... by the undersigned, thereunto duly authorized. ORACLE CORPORATION Date: June 27, 2011 By: /s/ LAWRENCE J. ELLISON Lawrence J. Ellison Chief Executive Officer and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on...

  • Page 140
    Table of Contents ORACLE CORPORATION INDEX OF EXHIBITS Incorporated by Reference Filing Exhibit Date Exhibit No. Exhibit Description Form File No. Filed By Filed Herewith 3.01 Amended and Restated Certificate of Incorporation of Oracle Corporation and Certificate of Amendment of Amended and...

  • Page 141
    ... Indemnification Agreement for Directors and Executive 10-Q Officers 10.08 10.09 Form of Commercial Paper Dealer Agreement relating to the $5,000,000,000 Commercial Paper Program Issuing and Paying Agency Agreement between Oracle Corporation and JP Morgan Chase Bank, National Association dated as of...

  • Page 142
    ... of Cash Flows for the years ended May 31, 2011, 2010 and 2009, (v) Notes to Consolidated Financial Statements and (vi) Financial Statement Schedule II X X X X X X X X * Indicates management contract or compensatory plan or arrangement 138 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 143
    ... federal, state or local mass layoff, reduction-in-force, and/or plant closing law (including, without limitation, the Federal Worker Retraining and Notification Act ["WARN"] and similar state laws, including, Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 144
    ...All stock options not vested as of April 25, 2011 are canceled. Epstein understands and acknowledges that vested options must be exercised at any time up to and including three months after his final date of 3. 4. 5. 6. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 145
    ... customer or client during the twelve months preceding his termination from Oracle. Epstein agrees to continue abiding by the terms and conditions of the Proprietary Information Agreement. 8. Section 1542 Waiver. Epstein voluntarily waives the provision of Section 1542 of the California Civil Code...

  • Page 146
    ...for the severance payment amount set forth in paragraph 1 of this Agreement, Epstein releases Oracle, all of its related or affiliated entities, and all of its and their present and former officers, directors, agents, employees, representatives, affiliates, successors, assigns, parent companies, and...

  • Page 147
    ... to the business reputation of Oracle. Oracle agrees that its executive management team will not disparage Epstein, or make or solicit any comments, statements, or the like to the...12. 13. 14. 15. 16. 17. 18. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 148
    ... to all the terms and conditions contained herein. B. C. /s/ Jeff Epstein Jeff Epstein /s/ Juana M. Schurman Oracle America, Inc. Juana M. Schurman VP and Assoc. GC 5/11/11 By: Title: Dated: 5/4/11 Dated: Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 149
    ... 12.01 ORACLE CORPORATION Consolidated Ratio of Earnings to Fixed Charges (Unaudited) Year Ended May 31, 2009 2008 (Dollars in millions) Earnings Income before provision for income taxes Add: Noncontrolling interests Add: Fixed charges Total earnings Fixed Charges Interest expense Estimate of...

  • Page 150
    ... of Incorporation Oracle America, Inc. Oracle International Corporation Oracle Global Holdings, Inc. Oracle Japan Holding, Inc. Oracle EMEA Holdings Oracle Technology Company Delaware California Delaware Delaware Ireland Ireland Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar...

  • Page 151
    ... Form S-8 333-169089 Form S-3 Form S-8 333-166643 333-164734 Sun Microsystems, Inc. 2007 Omnibus Incentive Plan, Sun Microsystems, Inc. 1990 Long-Term Equity Incentive Plan, Sun Microsystems, Inc. Equity Compensation Acquisition Plan, Sun Microsystems, Inc. 1988 Directors' Stock Option Plan, Sun...

  • Page 152
    ... 1992 Nonqualified Stock Option Plan, J.D. Edwards & Company 1997 Equity Incentive Plan, J.D. Edwards & Company 2003 Form S-8 333-139901 Form S-8 Form S-8 Form S-8 333-139875 333-138694 333-136275 Form S-8 333-131988 Form S-8 333-131427 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 153
    ... Stock Option Plan, Oracle Corporation 1993 Deferred Compensation Plan, Oracle Corporation 401(k) Savings and Investment Plan of our reports dated June 27, 2011, with respect to the consolidated financial statements and schedule of Oracle Corporation, and the effectiveness of internal control...

  • Page 154
    ..., that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. By: /s/ LAWRENCE J. ELLISON Lawrence J. Ellison Chief Executive Officer and Director b) Date: June 27, 2011 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 155
    ..., that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. By: /s/ SAFRA A. CATZ Safra A. Catz President, Chief Financial Officer and Director b) Date: June 27, 2011 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 156
    ... By: /s/ LAWRENCE J. ELLISON Lawrence J. Ellison Chief Executive Officer and Director By: /s/ SAFRA A. CATZ Safra A. Catz President, Chief Financial Officer and Director Date: June 27, 2011 Date: June 27, 2011 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 157
    ... Focus Document Fiscal Period Focus Document Period End Date Trading Symbol Amendment Flag Document Type Oracle Corporation 0001341439 --05-31 Yes No Yes Large Accelerated Filer $ 107,183,061,000 5,065,515,000 2,011 FY 2011-05-31 ORCL false 10-K Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 158
    ..., net Intangible assets, net Goodwill Deferred tax assets Other assets Total non-current assets Total assets Liabilities and Stockholders' Equity: Current liabilities: Notes payable, current and other current borrowings Accounts payable Accrued compensation and related benefits Deferred revenues...

  • Page 159
    ... SHEETS PARENTHETICAL CONSOLIDATED BALANCE SHEETS PARENTHETICAL (USD $) (in Millions) except Per Share Data 05/31/2011 05/31/2010 05/31/2009 05/31/2008 Statement line items Allowance for doubtful accounts receivable Preferred stock par or stated value per share Preferred stock shares authorized...

  • Page 160
    ...Hardware systems revenues Services Total revenues Operating Expenses: Sales and marketing Software license updates and product support Hardware systems products Hardware systems support Services Research and development General and administrative Amortization of intangible assets Acquisition related...

  • Page 161
    ... under stock purchase plans Assumption of stock-based compensation plan awards in connection with acquisitions Stock-based compensation in consolidated statements of equity Repurchase of common stock Cash dividends declared Tax benefit from stock plans Other, net in consolidated statements of equity...

  • Page 162
    ... 12 Months Ended 05/31/2009 Beginning common stock shares outstanding Common stock issued under stock purchase plans (shares) Cash dividends declared per share Ending common stock shares outstanding 5,026 4 $ 0.21 5,068 3 $ 0.20 5,026 3 $ 0.05 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 163
    ... taxes payable Increase in deferred revenues Net cash provided by operating activities Cash Flows From Investing Activities: Purchases of marketable securities and other investments Proceeds from maturities and sales of marketable securities and other investments Acquisitions, net of cash acquired...

  • Page 164
    Increase (decrease) in unsettled repurchases of common stock Supplemental schedule of cash flow data: Cash paid for income taxes Cash paid for interest 12 (12) 2,931 $ 770 2,488 $ 652 2,170 $ 627 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 165
    ... software and hardware related services including consulting, Cloud Services and education revenues. Revenue Recognition for Software Products and Software Related Services (Software Elements) New software license revenues represent fees earned from granting customers licenses to use our database...

  • Page 166
    ... Hardware Systems Related Services (Nonsoftware Arrangements) Beginning in fiscal 2010, we have applied the provisions of Accounting Standards Update No. 2009-13, Revenue Recognition (Topic 605) Multiple-Deliverable Revenue Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 167
    ... arrangements are generally accounted for separately from new software license revenues because the arrangements qualify as services transactions as defined in ASC 985-605. The more significant factors considered Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 168
    ... date. Provided all other revenue recognition criteria have been met, we recognize new software license revenues and hardware systems products revenues for these arrangements upon delivery, net of any payment discounts from Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 169
    ... within 90 days of the contracts' dates of execution and we classify the proceeds from these sales as cash flows from operating activities in our consolidated statements of cash flows. We account for the sales of these receivables as "true sales" as defined in ASC 860, Transfers and Servicing, as we...

  • Page 170
    ... of our payment terms for the significant majority of our customer contracts and by the diversification of our customer base. No single customer accounted for 10% or more of our total revenues in fiscal 2011, 2010 or 2009. Inventories Inventories are stated at the lower of cost or market value. Cost...

  • Page 171
    ... represent value-added tax and sales tax receivables associated with the sale of our products and services to third parties. Other receivables are included in prepaid expenses and other current assets in our consolidated balance sheets and totaled $876 million and $733 million at May 31, 2011...

  • Page 172
    ... services fees. Year Ended May 31, (in millions) Transitional and other employee related costs Stock-based compensation Professional fees and other, net Business combination adjustments, net 2011 $ 129 10 66 3 2010 $ 66 15 68 5 2009 $ 45 15 35 22 Total acquisition related and other expenses...

  • Page 173
    ... settlement. We recognize interest and penalties related to uncertain tax positions in our provision for income taxes line of our consolidated statements of operations. A description of our accounting policies associated with tax related contingencies and valuation allowances assumed as a part...

  • Page 174
    ... used, and the activity in Level 3 fair value measurements. Certain provisions of this update will be effective for us in fiscal 2012 and we and do not believe these provisions will have a material impact on our consolidated financial statements. Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 175
    ... ATG in our consolidated financial statements from the date of acquisition. The total preliminary purchase price for ATG was approximately $1.0 billion, which consisted of approximately $990 million in cash and $16 million for the fair value of stock options and restricted stock-based awards assumed...

  • Page 176
    ... 2011 and 2010: Year Ended May 31, (in millions, except per share data) Total revenues Net income Basic earnings per share Diluted earnings per share $ $ $ 2011 $ 35,783 8,525 1.69 1.66 $ $ $ 2010 $ 33,965 5,591 1.12 1.10 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 177
    ...limit the amount of credit exposure to any one issuer. As stated in our investment policy, we are averse to principal loss and seek to preserve our invested funds by limiting default risk, market risk and reinvestment risk. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 178
    ... market data. Our discounted cash flow techniques used observable market inputs such as LIBOR-based yield curves, among others. Our cash and cash equivalents, marketable securities and derivative financial instruments are recognized and measured at fair value in our consolidated financial statements...

  • Page 179
    ... rates we could obtain for other borrowings with similar terms at those dates, the estimated fair values of our borrowings at May 31, 2011 and May 31, 2010 were $17.4 billion and $15.9 billion, respectively. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 180
    ... (USD $) 12 Months Ended 05/31/2011 INVENTORIES 5. INVENTORIES Inventories consisted of the following: May 31, (in millions) Raw materials Work-in-process Finished goods 2011 $ 94 17 192 2010 $ 95 43 121 Total $303 $259 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar...

  • Page 181
    ...245 495 692 60 2010 $ 1,400 1,995 409 757 87 Total property, plant and equipment Accumulated depreciation 1-50 years 5,095 (2,238 ) 4,648 (1,885 ) Total property, plant and equipment, net $ 2,857 $ 2,763 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 182
    ... is generally not deductible for tax purposes, for our software business operating segments, our hardware systems support operating segment and our services business for fiscal 2011 and 2010 were as follows: Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 183
    ... associated with certain acquired product offerings to our new software licenses operating segment. The other goodwill adjustments presented in the table above were not significant to our previously reported operating results or financial position. Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 184
    ...), and $1.25 billion of 6.50% senior notes is due April 2038 (2038 Notes). We issued these senior notes for general corporate purposes and for our acquisition of BEA Systems, Inc. and acquisition related expenses. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 185
    ...Agreement dated March 15, 2006, among Oracle and the lenders named therein (the 2006 Credit Agreement) expired pursuant to its terms. No debt was outstanding pursuant to the 2006 Credit Agreement as of its date of expiration. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 186
    ...Costs(3) Year Ended May 31, 2011 Accrued May 31, 2011(2) Others(5) Total Costs Accrued to Date Total Expected Program Costs Adj. to Cost(4) Cash Payments Sun Restructuring Plan(1) New software licenses Software license updates and product support Hardware systems business Services General and...

  • Page 187
    ...) Accrued May 31, 2009 Year Ended May 31, 2010 Initial Costs(3) Adj. to Cost(4) Cash Payments Others(5) Accrued May 31, 2010(2) Sun Restructuring Plan(1) New software licenses Software license updates and product support Hardware systems business Services General and administrative and other...

  • Page 188
    ...which the current impact to our consolidated statements of operations was not significant. (7) Restructuring plans included in this footnote represent those plans that management has deemed the most significant. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 189
    ... undelivered consulting or other services. In connection with the purchase price allocations related to our acquisitions, we have estimated the fair values of the software license updates and product support obligations and hardware systems support obligations assumed from our acquired companies. We...

  • Page 190
    DERIVATIVE FINANCIAL INSTRUMENTS DERIVATIVE FINANCIAL INSTRUMENTS (USD $) 12 Months Ended 05/31/2011 DERIVATIVE FINANCIAL INSTRUMENTS DERIVATIVE FINANCIAL INSTRUMENTS Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 191
    ...in our non-operating income (expense), net were $(39) million, $(35) million and $3 million of net (losses) gains related to these forward contracts for the years ended May 31, 2011, 2010 and 2009, respectively. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 192
    ... certain companies for cash consideration that we expect to pay upon the closing of these acquisitions. As described in Note 8, we have notes payable and other borrowings outstanding of $15.9 billion that mature at various future dates. Guarantees Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 193
    ... related to foreign exchange trades, taxes, import licenses and letters of credit on behalf of parties with whom we conduct business. Such agreements have not had a material effect on our results of operations, financial position or cash flows. Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 194
    ... may be effected from time to time through open market purchases or pursuant to a Rule 10b5-1 plan. Our stock repurchase program may be accelerated, suspended, delayed or discontinued at any time. Dividends on Common Stock During fiscal 2011, our Board of Directors declared cash dividends of $0.21...

  • Page 195
    ... 05/31/2011 EMPLOYEE BENEFIT PLANS 14. EMPLOYEE BENEFIT PLANS Stock-based Compensation Plans Stock Option Plans In fiscal 2001, we adopted the 2000 Long-Term Equity Incentive Plan, which provides for the issuance of non-qualified stock options and incentive stock options, as well as stock purchase...

  • Page 196
    ... in our consolidated statements of operations: Year Ended May 31, (in millions) Sales and marketing Software license updates and product support Hardware systems products Hardware systems support Services Research and development General and administrative Acquisition related and other $ 2011 87...

  • Page 197
    ... total tax benefits received, we classified excess tax benefits from stock-based compensation of $215 million, $110 million and $194 million as cash flows from financing activities rather than cash flows from operating activities for fiscal 2011, 2010 and 2009, respectively. Employee Stock Purchase...

  • Page 198
    ... decisions and statute expirations, net Domestic production activity deduction Other, net $ 2011 3,994 (1,125 ) 188 (53 ) (206 ) 66 $ 2010 2,885 (672 ) 161 (315 ) (95 ) 144 $ 2009 2,742 (673 ) 201 25 (82 ) 28 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 199
    ...$ (130 ) (2,128 ) (101 ) 2011 2010 Total deferred tax liabilities $ (1,990 ) $ (2,359 ) Deferred tax assets: Accruals and allowances Employee compensation and benefits Differences in timing of revenue recognition Depreciation and amortization Tax credit and net operating loss carryforwards Other...

  • Page 200
    ...our transfer pricing and do not bind tax authorities outside the United States. We have finalized bilateral Advance Pricing Agreements, which are effective for the years ending May 31, 2002 through May 31, 2006 and May 31, 2007 through May 31, 2013. Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 201
    ... server software, Service-Oriented Architecture and business process management software, data integration software, business intelligence software, identity and access management software, content management software, portals and user interaction software, and development tools. Our database...

  • Page 202
    ... Margin(2) $ 22,129 $ 17,286 $ 14,943 (1) Operating segment revenues generally differ from the external reporting classifications due to certain software license products that are classified as service revenues for management reporting purposes. Software license updates and product support...

  • Page 203
    ...operating segment margin to income before provision for income taxes: Year Ended May 31, (in millions) Total revenues for reportable segments Software license updates and product support revenues(1) Hardware systems support revenues(1) 2011 $ 35,850 (80 ) (148 ) 2010 $ 27,034 (86 ) (128 ) 2009 $ 23...

  • Page 204
    ... $ 23,252 $ 2,528 (1) Long-lived assets exclude goodwill, intangible assets, equity investments and deferred taxes, which are not allocated to specific geographic locations as it is impracticable to do so. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 205
    ...shares issuable under the employee stock purchase plan using the treasury stock method. The following table sets forth the computation of basic and diluted earnings per share: Year Ended May 31, (in millions, except per share data) Net income 2011 $ 8,547 2010 $ 6,135 2009 $ 5,593 Weighted average...

  • Page 206
    ... with prospective economic advantage. Oracle alleged that SAP unlawfully accessed Oracle's Customer Connection support website and improperly took and used Oracle's intellectual property, including software code and knowledge management solutions. On June 1, 2007, Oracle filed its First Amended...

  • Page 207
    ... required under its contract with the General Services Administration (GSA), and that Oracle made false statements to the United States government. Plaintiffs alleged that the officer and director defendants are responsible for this alleged conduct and have exposed Oracle to reputational damage...

  • Page 208
    ... or Other Accounts Write-offs Translation Adjustments and Other Ending Balance Allowances for Doubtful Trade Receivables Year Ended: May 31, 2009 $ 303 118 (128 ) (23 ) $ 270 May 31, 2010 $ 270 143 (92 ) (16 ) $ 305 May 31, 2011 $ 305 164 (113 ) 16 $ 372 Source: ORACLE CORP, 10...

  • Page 209
    ... software and hardware related services including consulting, Cloud Services and education revenues. Revenue Recognition for Software Products and Software Related Services (Software Elements) New software license revenues represent fees earned from granting customers licenses to use our database...

  • Page 210
    ...contracts are generally priced as a percentage of the net new software license fees. Substantially all of our customers renew their software license updates and product support contracts annually. Revenue Recognition for Multiple-Element Arrangements - Software Products and Software Related Services...

  • Page 211
    ...factors relating to the assumptions, risks and uncertainties inherent with the application of the proportional performance method of accounting affects the amounts of revenues and related expenses reported in our consolidated Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 212
    ...or services from a customer, we negotiate the purchase separately from any sales transaction, at terms we consider to be at arm's length, and settle the purchase in cash. We recognize new software license revenues or hardware Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 213
    ...of our policies differ when accounting for acquisitions in fiscal 2010 and prospective periods in comparison to the accounting for acquisitions in fiscal 2009 and prior periods, including: • the fair value of in-process research and development is recorded as an indefinite-lived intangible asset...

  • Page 214
    ... payment terms for the significant majority of our customer contracts and by the diversification of our customer base. No single customer accounted for 10% or more of our total revenues in fiscal 2011, 2010 or 2009. Inventories are stated at the lower of cost or market value. Cost is computed using...

  • Page 215
    ... (expense), net in the accompanying consolidated statements of operations were $11 million, $(149) million and $(65) million in fiscal 2011, 2010 and 2009, respectively. We account for share-based payments, including grants of employee stock options and restricted stock-based awards and purchases...

  • Page 216
    ... services fees. Year Ended May 31, (in millions) Transitional and other employee related costs Stock-based compensation Professional fees and other, net Business combination adjustments, net 2011 $ 129 10 66 3 2010 $ 66 15 68 5 2009 $ 45 15 35 22 Total acquisition related and other expenses...

  • Page 217
    ... used, and the activity in Level 3 fair value measurements. Certain provisions of this update will be effective for us in fiscal 2012 and we and do not believe these provisions will have a material impact on our consolidated financial statements. Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 218
    ...ACCOUNTING POLICIES (Tables) (USD $) 12 Months Ended 05/31/2011 Year Ended May 31, (in millions) 2011 2010 2009 Acquisition Related and Other Expenses Transitional and other employee related costs Stock-based compensation Professional fees and other, net Business combination adjustments, net Total...

  • Page 219
    ACQUISITIONS (Tables) ACQUISITIONS (Tables) (USD $) 12 Months Ended 05/31/2011 Unaudited Pro Forma Financial Information Year Ended May 31, (in millions, except per share data) Total revenues Net income Basic earnings per share Diluted earnings per share 2011 $35,783 $ 8,525 $1.69 $1.66 2010 $33,...

  • Page 220
    ... SECURITIES (Table) (USD $) 12 Months Ended 05/31/2011 May 31, (in millions) 2011 2010 Cash, Cash Equivalents and Marketable Securities Table Money market funds U.S. Treasury, U.S. government and U.S. government agency debt securities Commercial paper, corporate debt securities and other Total...

  • Page 221
    ... (Tables) FAIR VALUE MEASUREMENTS (Tables) (USD $) 12 Months Ended 05/31/2011 Assets Measured at Fair Value on a Recurring Basis May 31, 2011 Fair Value Measurements Using Input Types May 31, 2010 Fair Value Measurements Using Input Types Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 222
    ... 2 Total $3,362 1,150 $- - $ 3,362 1,150 $2,423 3,010 $- - $2,423 3,010 - 106 - $ 4,618 11,884 1,885 69 $ 13,838 11,884 1,991 69 $ 18,456 - - - $ 5,433 $ 5,667 3,378 2,256 33 3,378 2,256 33 $ 11,100 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 223
    INVENTORIES (Tables) INVENTORIES (Tables) (USD $) 12 Months Ended 05/31/2011 May 31, Inventories (in millions) Raw materials Work-in-process Finished goods Total 2011 $ 94 17 192 $303 2010 $ 95 43 121 $259 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 224
    ... Accumulated depreciation Total property, plant and equipment, net 1-5 years 1-50 years 3-10 years - - 1-50 years $1,603 2,245 495 692 60 5,095 (2,238) $2,857 $1,400 1,995 409 757 87 4,648 (1,885) $2,763 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 225
    ...Software License Updates Hardware and Systems Product Support Support 11,334 490 (22) $ 11,802 - 891 32 $923 Services 1,792 2 (89) $1,705 Total 18,842 1,600 (17) $20,425 Balances as of May 31, 2009 Goodwill from acquisitions Goodwill adjustments (1) Balances as of May 31, 2010 Source: ORACLE CORP...

  • Page 226
    ... associated with certain acquired product offerings to our new software licenses operating segment. The other goodwill adjustments presented in the table above were not significant to our previously reported operating results or financial position. Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 227
    ... AND OTHER BORROWINGS (Table) NOTES PAYABLE AND OTHER BORROWINGS (Table) (USD $) 12 Months Ended 05/31/2011 (Dollars in millions) Commercial paper notes Short-term borrowings (effective interest rate of 0.44%) 5.00% senior notes due January 15, 2011, net of discount of $1 as of May 31, 2010 4.95...

  • Page 228
    ...(2) Initial Costs(3) Year Ended May 31, 2011 Adj. to Cost(4) Cash Payments Others(5) Accrued May 31, 2011 (2) Sun Restructuring Plan(1) New software licenses Software license updates and product support Hardware systems business Services General and administrative and other Total Sun Restructuring...

  • Page 229
    ... are generally recorded to operating expenses in the period of adjustment with decreases in the costs of our Oracle-based plans (included in the "total other restructuring plans" line in the above table) being recorded to operating expenses and decreases in costs of our acquisition related plans...

  • Page 230
    ... REVENUES (Tables) (USD $) 12 Months Ended 05/31/2011 Deferred Revenues May 31, (in millions) Software license updates and product support Hardware systems support Services New software licenses Hardware systems products Deferred revenues, current Deferred revenues, non-current liabilities) Total...

  • Page 231
    ... lease payments, net Unconditional Purchase and Certain Other Obligations $ 458 341 226 159 121 265 1,570 (238) $ 1,332 Fiscal 2012 Fiscal 2013 Fiscal 2014 Fiscal 2015 Fiscal 2016 Total $ 453 15 7 3 3 $ 481 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 232
    ... instruments, net Unrealized gains on marketable securities, net Unrealized losses on defined benefit plans, net Total accumulated other comprehensive income $649 (131) 30 (6) $542 $169 (131) 4 (38) $4 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 233
    ... our closing stock price on the last trading day of fiscal 2011 of $34.22 and the exercise prices for all in-the-money options outstanding, excluding tax effects. (2) The unrecognized compensation expense calculated under the fair value method for shares expected to vest (unvested shares net of...

  • Page 234
    Stock Based Compensation Expense (in millions) Year Ended May 31, 2011 2010 2009 Sales and marketing Software license updates and product support Hardware systems products Hardware systems support Services Research and development General and administrative Acquisition related and other Total ...

  • Page 235
    ...2,636 Effective income tax rate Reconciliation of Differences Between Federal Statutory Tax Rate and Effective Tax Rate (in millions) 25.1% 25.6% 28.6% Year Ended May 31, 2011 2010 2009 Tax provision at statutory rate Foreign earnings at other than United States rates State tax expense, net of...

  • Page 236
    ...on stock Acquired intangible assets Other Total deferred tax liabilities Deferred tax assets: Accruals and allowances Employee compensation and benefits Differences in timing of revenue recognition Depreciation and amortization Tax credit and net operating loss carryforwards Other Total deferred tax...

  • Page 237
    ... (Tables) (USD $) 12 Months Ended 05/31/2011 Year Ended May 31, (in millions) 2011 2010 2009 Summary of Businesses and Operating Segments Results New software licenses: Revenues(1) Sales and distribution expenses Margin(2) Software license updates and product support: Revenues(1) Software license...

  • Page 238
    ...) 2011 Year Ended May 31, 2010 2009 Total revenues for reportable segments Software license updates and product support revenues(1) Hardware systems support revenues (1) Total revenues Reconciliation of Total Margin from Segments to Consolidated Income before Provision for Income Taxes $35...

  • Page 239
    Stock-based compensation Interest expense Non-operating income (expense), net Income before provision for income taxes _____ (500) (808) 120 $11,411 (421) (754) (139) $8,243 (340) (630) 108 $7,834 (1) Software license updates and product support revenues for management reporting include $80 ...

  • Page 240
    EARNINGS PER SHARE (Tables) EARNINGS PER SHARE (Tables) (USD $) 12 Months Ended 05/31/2011 Year Ended May 31, (in millions, except per share data) 2011 2010 2009 Earnings Per Share Net income Weighted average common shares outstanding Dilutive effect of employee stock plans Diluted weighted ...

  • Page 241
    ... and Qualifying Accounts Table (in millions) Allowances for Doubtful Trade Receivables Year Ended: May 31, 2009 May 31, 2010 May 31, 2011 $303 $270 $305 118 143 164 (128) (92) (113) (23) (16) 16 $270 $305 $372 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 242
    ... ACCOUNTING POLICIES (Details) (USD $) (in Millions) 12 Months Ended 05/31/2011 12 Months Ended 05/31/2010 12 Months Ended 05/31/2009 Transitional and other employee related costs Stock-based compensation Professional fees and other, net Business combination adjustments, net Total acquisition...

  • Page 243
    ... capitalization under ASC 985-20, Software-Costs of Software to be Sold, Leased or Marketed , were not material to our consolidated financial statements in fiscal 2011, 2010 or 2009. No single customer accounted for 10% or more of our total revenues in fiscal 2011, 2010 or 2009. We did not recognize...

  • Page 244
    ...ACQUISITIONS (Details) (USD $) (in Millions except Per Share Data) 12 Months Ended 05/31/2011 12 Months Ended 05/31/2010 Acquired companies' contribution to total software revenues Sun's contribution to total revenue Sun's contribution to reduction of operating income Total revenues (Pro forma) Net...

  • Page 245
    ... debt securities and other Total investments Investments classified as cash equivalents Investments classified as marketable securities $ 3,362 1,150 13,875 18,387 5,702 $ 12,685 $ 2,423 3,010 5,634 11,067 2,512 $ 8,555 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 246
    ... 05/31/2011 05/31/2010 Total debt Total debt fair value Money market funds U.S. Treasury, U.S. government and U.S. government agency debt securities $ 15,900 17,400 3,362 $ 1,150 $ 14,600 15,900 2,423 $ 3,010 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 247
    INVENTORIES (Details) INVENTORIES (Details) (USD $) (in Millions) 05/31/2011 05/31/2010 Raw materials Work-in-process Finished goods Total $ 94 17 192 $ 303 $ 95 43 121 $ 259 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 248
    ... Furniture, fixtures and other Land Construction in progress Total property, plant and equipment Accumulated depreciation Total property, plant and equipment, net $ 1,603 2,245 495 692 60 5,095 (1,885) $ 2,857 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 249
    ... (in Millions) 12 Months Ended 05/31/2011 12 Months Ended 05/31/2010 12 Months Ended 05/31/2009 Indefinite Lived Intangible Assets Amortization of Intangible Assets Intangible Assets, Net $ 50 (2,428) $ 7,860 (1,973) $ 9,321 (1,713) Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar...

  • Page 250
    ...Fiscal 2014 Fiscal 2015 Fiscal 2016 Thereafter Total intangible assets subject to amortization In-process research and development Total intangible assets, net $ 2,275 1,902 1,554 1,155 657 267 7,810 50 $ 7,860 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 251
    ... period start Goodwill from acquisitions Goodwill adjustments Balances at period end Reclassification of Goodwill from Services to New Software Licenses $ 20,425 1,062 66 21,553 $ 18,842 1,600 (17) 20,425 $ 82 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 252
    ... payable and other borrowings [Line items] Total borrowings Notes payable, current and other current borrowings Notes payable, non-current and other non-current borrowings $ 15,922 1,150 $ 14,772 $ 14,655 3,145 $ 11,510 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 253
    ... dollars plus 0.25%, depending on the type of borrowings made by us. Any amounts borrowed pursuant to the 2011 Credit Agreements are due no later than June 30, 2011, the termination date of these credit agreements. Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 254
    ...2015 Fiscal 2016 Thereafter Total Commercial paper capacity Issuance of Commercial Paper Amounts outstanding under $3.0 billion, five-year Revolving Credit Agreement $ 1,150 1,250 0 1,500 2,000 10,000 15,900 $0 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 255
    ... $) (in Millions) 1 Months Ended 07/31/2010 1 Months Ended 07/31/2009 1 Months Ended 04/30/2008 1 Months Ended 05/31/2007 1 Months Ended 01/31/2006 Total debt issued $ 3,250 $ 4,500 $ 5,000 $ 2,000 $ 5,750 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 256
    RESTRUCTURING ACTIVITIES (Details) RESTRUCTURING ACTIVITIES (Details) (USD $) (in Millions) 12 Months Ended 05/31/2011 12 Months Ended 05/31/2010 Accrued at period end $ 449 $ 546 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 257
    ... from Sun Sun Restructuring Plan, remaining expenses to incur Sun Restructuring Plan, total expected program cost Sun Restructuring Plan, costs $ 449 244 205 97 $ 546 290 256 44 275 250 1,031 $ 439 $ 342 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 258
    ... Services New software licenses Hardware systems products Deferred revenues, current Deferred revenues, non-current (in other non-current liabilities) Total deferred revenues $ 5,386 687 438 263 28 6,802 316 $ 7,118 $ 4,618 537 376 330 39 5,900 388 $ 6,288 Source: ORACLE CORP, 10-K, June 28, 2011...

  • Page 259
    ... in income on derivative (ineffective portion and amount excluded from effectiveness testing) Cash flow hedges outstanding at May 31, 2011 Fair Value $ 2,500 1,600 (39) 0 (37) 1 0 $ 69 $ 33 (63) 10 (35) 3 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 260
    ... associated with the Floating Rate Notes and no other arrangements were outstanding as of May 31, 2011. Description of fair value hedges Description of net investment hedges Description of cash flow hedges Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research...

  • Page 261
    ... lease payments Less: minimum payments to be received from non-cancelable subleases Total future minimum operating leases payments, net $ 320 406 85 453 15 7 3 3 481 15,922 458 341 226 159 121 265 1,570 (238) $ 1,332 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document...

  • Page 262
    ...instruments, net Unrealized gains on marketable securities, net Unrealized losses on defined benefit plans, net Total accumulated other comprehensive income $ 0.21 649 (131) 30 (38) $ 542 169 (131) 4 (38) $4 40.4 $ 1,200 0.7 24 4,100 43.3 $ 1,000 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 263
    ... Data 12 Months Ended 05/31/2011 12 Months Ended 05/31/2010 12 Months Ended 05/31/2009 Sales and marketing Software license updates and product support Hardware systems products Hardware systems support Services Research and development General and administrative Acquisition related and other Total...

  • Page 264
    ... to vest Total In the money options Vested Expected to vest Total Closing stock price Unrecognized compensation expense Weighted average recognition period Shares not expected to vest Shares reserved for future issuances under the Purchase Plan Common stock issued under Stock Purchase Plan (shares...

  • Page 265
    ... limitation on utilization Tax credit carryforwards not subject to expiration dates Tax credit carryforwards subject to expiration dates Domestic Foreign Total income before provision for income taxes Accruals and allowances Employee compensation and benefits Source: ORACLE CORP, 10-K, June 28, 2011...

  • Page 266
    Differences in timing of revenue recognition Depreciation and amortization Tax credit and net operating loss carryforwards Other Total deferred tax assets Valuation allowance Net deferred tax assets Gross unrecognized tax benefits as of June 1 Increases related to tax positions from prior fiscal ...

  • Page 267
    ... Acquisition related and other Restructuring Stock-based compensation Interest expense Non-operating income (expense), net Income before provision for income taxes Revenues Sales and distribution expenses Margin Revenues Software license updates and product support expenses Margin Revenues Expenses...

  • Page 268
    ... Software license updates and product support revenues Hardware systems support revenues 270 115 4,662 3,643 1,019 35,850 13,721 22,129 80 $ 148 247 90 3,929 3,245 684 27,034 9,748 17,286 86 $ 128 282 103 4,386 3,534 852 23,495 8,552 14,943 243 Source: ORACLE CORP, 10-K, June 28, 2011 Powered...

  • Page 269
    ...Millions) except Per Share Data 12 Months Ended 05/31/2011 12 Months Ended 05/31/2010 12 Months Ended 05/31/2009 Net income Weighted average common shares outstanding Dilutive effect of employee stock plans Diluted weighted average common shares outstanding Basic earnings per share Diluted earnings...

  • Page 270
    ... (Details) (USD $) (in Millions) 12 Months Ended 05/31/2011 06/22/2011 Jury award from SAP intellectual property litigation SAP appeal bond related to SAP intellectual property litigation $ 1,300 $ 1,300 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„

  • Page 271
    .../31/2010 12 Months Ended 05/31/2009 Beginning Balance Additions Charged to Operations or Other Accounts Write-offs Translation Adjustments and Other Ending Balance $ 305 164 (113) 16 $ 372 $ 270 143 (92) (16) $ 305 $ 303 118 (128) (23) $ 270 Source: ORACLE CORP, 10-K, June 28, 2011 Powered by...

  • Page 272
    _____ Created by Morningstar® Document Researchâ„ http://documentresearch.morningstar.com Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Researchâ„