Oracle 2015 Annual Report Download - page 66

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Table of Contents
Fiscal 2016 Compared to Fiscal 2015: Excluding the effects of unfavorable currency rate fluctuations of 6 percentage points, total hardware products revenues
decreased during fiscal 2016 due to reductions in sales volumes of certain of our product lines, including lower margin products. This decrease was partially offset
by incremental revenues during the first quarter of fiscal 2016 from our recently acquired companies, primarily MICROS. On a constant currency basis, fiscal 2016
total hardware products revenues declines in the Americas and EMEA regions were partially offset by slight growth in the Asia Pacific region.
Excluding the effects of favorable currency rate fluctuations of 6 percentage points, total hardware products expenses decreased in fiscal 2016 due to lower
hardware products costs associated with lower hardware products revenues, and due to a reduction in expenses associated with certain of our intangible assets that
became fully amortized.
In constant currency, total margin and total margin as a percentage of revenues decreased in fiscal 2016 for this segment due to the decrease in our total revenues.
Fiscal 2015 Compared to Fiscal 2014: Excluding the effects of unfavorable currency rate fluctuations, total hardware products revenues were flat in fiscal 2015
as revenues from acquired companies, including MICROS, and increases in hardware revenues attributable to our Oracle Engineered Systems products were offset
by reductions in the sales volumes of certain of our other hardware product offerings. On a constant currency basis, revenue increases in the Americas and EMEA
regions were offset by revenue declines in the Asia Pacific region during fiscal 2015.
Excluding the effects of favorable currency rate fluctuations, total hardware products expenses decreased in fiscal 2015 primarily due to lower bad debt expenses
and a reduction in amortization of intangible assets. These fiscal 2015 expense decreases were partially offset by higher fiscal 2015 employee related expenses due
to increased headcount from our acquisitions and higher direct product costs that were primarily attributable to acquired products revenues.
In constant currency, total margin and margin as a percentage of revenues increased in fiscal 2015 due to the decrease in total expenses for this segment.
Hardware Support: Our hardware support offerings provide customers with software updates for software components that are essential to the functionality of
our hardware products, such as Oracle Solaris and certain other software products, and can include product repairs, maintenance services and technical support
services. Expenses associated with our hardware support operating segment include the cost of materials used to repair customer products, the cost of providing
support services, largely personnel related expenses, and the amortization of our intangible assets primarily associated with hardware support contracts and
customer relationships obtained from our acquisitions.
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