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Table of Contents
Fiscal 2013 Compared to Fiscal 2012: Amortization of intangible assets decreased during fiscal 2013 as certain of our intangible assets
pertaining to our legacy acquisitions became fully amortized. These decreases were partially offset by additional amortization from intangible
assets that we acquired in connection with our recent acquisitions, including our acquisitions of Acme Packet in fiscal 2013, and RightNow and
Taleo in fiscal 2012, among others.
Acquisition Related and Other Expenses:
Acquisition related and other expenses consist of personnel related costs for transitional and certain
other employees, stock-based compensation expenses, integration related professional services, certain business combination adjustments
including certain adjustments after the measurement period has ended and certain other operating items, net. Stock-
based compensation expenses
included in acquisition related and other expenses resulted from unvested stock options and restricted stock-based awards assumed from
acquisitions whereby vesting was accelerated upon termination of the employees pursuant to the original terms of those stock options and
restricted stock-based awards.
Fiscal 2014 Compared to Fiscal 2013: On a constant currency basis, the increase in our acquisition related and other expenses in fiscal 2014
was primarily due to certain benefits that we recorded during fiscal 2013, which reduced our expenses during this period. We recorded a net
benefit of $387 million during fiscal 2013 related to the change in fair value of contingent consideration payable in connection with an
acquisition (see Note 2 of Notes to Consolidated Financial Statements included elsewhere in this Annual Report). We also recorded a $306
million benefit in fiscal 2013 to professional fees and other, net related to certain litigation (see Note 18 of Notes to Consolidated Financial
Statements included elsewhere in this Annual Report).
Fiscal 2013 Compared to Fiscal 2012: On a constant currency basis, the decrease in our acquisition related and other expenses in fiscal 2013
was primarily due to the aforementioned benefits described above.
Restructuring expenses:
Restructuring expenses result from the execution of management approved restructuring plans that were generally
developed to improve our cost structure and/or operations, often in conjunction with our acquisition integration strategies. Restructuring
expenses consist of employee severance costs and may also include charges for duplicate facilities and other contract termination costs to
improve our cost structure prospectively. For additional information regarding our restructuring plans, see Note 9 of Notes to Consolidated
Financial Statements included elsewhere in this Annual Report.
Restructuring expenses in fiscal 2014 and 2013 primarily related to our 2013 Restructuring Plan, which our management approved, committed to
and initiated in order to restructure and further improve efficiencies in our operations. We amended the 2013 Restructuring Plan in the third
quarter of fiscal 2013 and in the first quarter of fiscal 2014 to reflect additional actions that we expect to take to improve efficiencies in our
operations. The total estimated restructuring costs associated with the 2013 Restructuring Plan are $705 million and will be recorded to the
restructuring expense line item within our consolidated statements of operations as they are incurred. The total estimated remaining restructuring
costs associated with the 2013 Restructuring Plan were approximately
64
Year Ended May 31,
Percent Change
Percent Change
(Dollars in millions)
2014
Actual
Constant
2013
Actual
Constant
2012
Transitional and other employee related costs
$
27
1%
2%
$
27
6%
9%
$
25
Stock
-
based compensation
10
-
69%
-
69%
33
1%
1%
33
Professional fees and other, net
20
107%
107%
(276
)
-
2,314%
-
2,216%
13
Business combination adjustments, net
(16
)
96%
96%
(388
)
-
2,543%
-
2,426%
(15
)
Total acquisition related and other expenses
$
41
107%
107%
$
(604
)
-
1,183%
-
1,200%
$
56
Year Ended May 31,
Percent Change
Percent Change
(Dollars in millions)
2014
Actual
Constant
2013
Actual
Constant
2012
Restructuring expenses
$
183
-
48%
-
49%
$
352
19%
23%
$
295