Plantronics 2015 Annual Report Download - page 40

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Geographic Information
Fiscal Year Ended Fiscal Year Ended
(in thousands)
March 31,
2015
March 31,
2014 Change
March 31,
2014
March 31,
2013 Change
Net revenues:
United States $ 487,607 $ 475,278 $ 12,329 2.6% $ 475,278 $ 436,447 $ 38,831 8.9%
As a percentage of net revenues 56.4% 58.1% 58.1% 57.3%
Europe and Africa 213,702 195,385 18,317 9.4% 195,385 181,439 13,946 7.7%
Asia Pacific 104,829 94,455 10,374 11.0% 94,455 92,193 2,262 2.5%
Americas, excluding United States 58,872 53,489 5,383 10.1% 53,489 52,147 1,342 2.6%
Total international net revenues 377,403 343,329 34,074 9.9% 343,329 325,779 17,550 5.4%
As a percentage of net revenues 43.6% 41.9% 41.9% 42.7%
Total net revenues $ 865,010 $ 818,607 $ 46,403 5.7% $ 818,607 $ 762,226 $ 56,381 7.4%
As a percentage of total net revenues, U.S. net revenues decreased slightly in fiscal year 2015 compared to fiscal year 2014, with
international revenues, as a percentage of total net revenues, correspondingly increasing. The increase in absolute dollars in U.S.
net revenues was driven primarily by increased Enterprise net revenues due to continued growth in demand for UC and stronger
Consumer revenues as a result of a refreshed and enhanced next generation product portfolio. The increase in absolute dollars in
international revenues was also due primarily to increased Enterprise net revenues due to continued growth in demand for UC
with higher Consumer revenues contributing to a lesser extent. International revenues were reduced by approximately $4.7 million,
net of the effects of hedging, in fiscal year 2015 compared to fiscal year 2014, due to unfavorable foreign exchange fluctuations
in the other foreign currencies in which we sell.
As a percentage of total net revenues, U.S. net revenues increased slightly in fiscal year 2014 compared to fiscal year 2013, with
international revenues, as a percentage of total net revenues, correspondingly decreasing. The increase in absolute dollars in U.S.
net revenues resulted in roughly equal measure from increased Enterprise net revenues due to continued growth in demand for
UC and increased Consumer revenues as a result of an improved product portfolio. The increase in absolute dollars in international
revenues was also due almost entirely to increased Enterprise net revenues due to continued growth in demand for UC. A weaker
USD compared to the EUR and GBP resulted in increased international net revenues of approximately $2.3 million in fiscal year
2014 compared to fiscal year 2013, net of the effects of hedging.
Cost of Revenues and Gross Profit
Cost of revenues consists primarily of direct manufacturing and contract manufacturer costs, warranty expense, freight expense,
depreciation, duty expense, reserves for excess and obsolete inventory, royalties, and an allocation of overhead expenses, including
facilities, IT, and human resources costs.
Fiscal Year Ended Fiscal Year Ended
(in thousands)
March 31,
2015
March 31,
2014 Change
March 31,
2014
March 31,
2013 Change
Net revenues $ 865,010 $ 818,607 $ 46,403 5.7% $ 818,607 $ 762,226 $ 56,381 7.4%
Cost of revenues 403,391 391,979 11,412 2.9% 391,979 359,045 32,934 9.2%
Gross profit $ 461,619 $ 426,628 $ 34,991 8.2% $ 426,628 $ 403,181 $ 23,447 5.8%
Gross profit % 53.4% 52.1% 52.1% 52.9%
Compared to the prior year, gross profit as a percentage of revenues increased in fiscal year 2015 due primarily to reductions in
product costs and higher revenues from next-generation mobile products carrying better margins. These favorable impacts were
offset in part by the following: (i) a shift in product mix from Enterprise to Consumer; (ii) within Enterprise, the continued ramp
in UC, which carries lower margins than our non-UC Enterprise products; and (iii) non-recurrence of a favorable adjustment made
in fiscal year 2014 to correct an immaterial error related to our warranty and sales returns reserves. Refer to further discussion of
this prior year adjustment in Note 6, Details of Certain Balance Sheet Accounts, of the Notes to Consolidated Financial Statements
in this Annual Report on Form 10-K.
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