Oracle 2015 Annual Report Download - page 64

Table of Contents
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 expenses, and the amortization of
our intangible assets associated with software support contracts and customer relationships obtained from acquisitions.
Year Ended May 31,
Percent Change Percent Change
(Dollars in millions) 2016 Actual Constant 2015 Actual Constant 2014
Software License Updates and Product Support Revenues:
Americas $ 10,672 2% 5% $ 10,418 6% 7% $ 9,858
EMEA 5,703 -4% 5% 5,920 0% 9% 5,906
Asia Pacific 2,486 -1% 7% 2,509 3% 8% 2,442
Total revenues 18,861 0% 5% 18,847 4% 8% 18,206
Expenses:
Software license updates and product support 1,123 -5% 1% 1,178 3% 8% 1,140
Stock-based compensation 23 11% 11% 21 -7% -7% 22
Amortization of intangible assets 504 -32% -32% 741 -7% -7% 801
Total expenses 1,650 -15% -12% 1,940 -1% 2% 1,963
Total Margin $ 17,211 2% 7% $ 16,907 4% 9% $ 16,243
Total Margin % 91% 90% 89%
% Revenues by Geography:
Americas 57% 55% 54%
EMEA 30% 32% 33%
Asia Pacific 13% 13% 13%
Excluding stock-based compensation
Included as a component of ‘Amortization of Intangible Assets’ in our consolidated statements of operations
Fiscal 2016 Compared to Fiscal 2015: Excluding the effects of unfavorable currency rate fluctuations of 5 percentage points, software license updates and
product support revenues increased during fiscal 2016 as a result of substantially all customers electing to purchase software support contracts in conjunction with
their new software licenses purchased during the trailing 4-quarter period, and due to the renewal of substantially all of the software support customer base eligible
for renewal during the trailing 4-quarter period and incremental revenues from our recent acquisitions. Excluding the effects of currency rate fluctuations, the
Americas region contributed 56%, the EMEA region contributed 26% and the Asia Pacific region contributed 18% to the increase in software license updates and
product support revenues during fiscal 2016.
Excluding the effects of favorable foreign currency rate fluctuations of 3 percentage points, total software license updates and product support expenses decreased
during fiscal 2016 primarily due to a reduction in expenses associated with certain of our intangible assets that became fully amortized.
In constant currency, total margin and margin as a percentage of revenues increased in fiscal 2016 due to the growth in total revenues and the decrease in total
expenses for this segment.
Fiscal 2015 Compared to Fiscal 2014: Excluding the effects of unfavorable currency rate fluctuations of 4 percentage points, software license updates and
product support revenues increased during fiscal 2015 relative to fiscal 2014 due to similar reasons as noted above for the fiscal 2016 increase. Excluding the
effects of currency rate fluctuations, the Americas region contributed 50%, the EMEA region contributed 36% and the Asia Pacific region contributed 14% to the
increase in software license updates and product support revenues during fiscal 2015.
Excluding the effects of favorable foreign currency rate fluctuations of 3 percentage points, total software license updates and product support expenses increased
during fiscal 2015 due to higher employee related expenses and facilities costs associated with increased headcount that was primarily attributable to acquisitions,
and also due to
62
(1)
(2)
(1)
(2)