Adobe 2012 Annual Report Download - page 70

70
LIQUIDITY AND CAPITAL RESOURCES
This data should be read in conjunction with our Consolidated Statements of Cash Flows.
As of
(in millions) November 30, 2012 December 2, 2011
Cash and cash equivalents .................................................................................................. $ 1,425.1 $ 989.5
Short-term investments....................................................................................................... $ 2,113.3 $ 1,922.2
Working capital................................................................................................................... $ 3,059.6 $ 2,520.7
Stockholders’ equity........................................................................................................... $ 6,665.2 $ 5,783.1
A summary of our cash flows is as follows:
(in millions) Fiscal
2012 Fiscal 2011 Fiscal 2010
Net cash provided by operating activities ................................................... $ 1,499.6 $ 1,543.3 $ 1,113.0
Net cash used for investing activities.......................................................... (834.7)(757.4)(1,159.3)
Net cash used for financing activities.......................................................... (234.7)(550.4)(215.3)
Effect of foreign currency exchange rates on cash and cash equivalents.... 5.4 4.1 12.0
Net increase (decrease) in cash and cash equivalents ................................. $ 435.6 $ 239.6 $ (249.6)
Our primary source of cash is receipts from revenue. The primary uses of cash are payroll related expenses, general operating
expenses including marketing, travel and office rent, and cost of revenue. Other sources of cash are proceeds from the exercise
of employee options and participation in the ESPP. Other uses of cash include our stock repurchase program, which is described
below, business acquisitions and purchases of property and equipment.
Cash Flows from Operating Activities
For fiscal 2012, net cash provided by operating activities of $1.5 billion was primarily comprised of net income plus the
net effect of non-cash items. The primary working capital sources of cash were net income coupled with increases in deferred
revenue and decreases in trade receivables. Deferred revenue increased primarily due to an increase in activity for both upgrade
plans with support and site and term licenses largely associated with our Digital Media and Digital Marketing enterprise license
agreements. The decrease in trade receivables is primarily related to an increase in revenue linearity and improved collections in
our Digital Marketing portfolio offset in part by higher revenue levels due to the CS6 product release which occurred late in the
second quarter of fiscal 2012.
The primary working capital uses of cash were decreases in accrued restructuring and trade payables. Decreases in accrued
restructuring primarily related to payments and adjustments for employee terminations and facility exit costs associated with the
Fiscal 2011 Restructuring Plan, a significant portion of which were paid and adjusted in the first and second quarters of fiscal
2012. Trade payables decreased primarily due to the timing of payments as a greater number of invoices were paid prior to the
fiscal year end in fiscal 2012 as compared to fiscal 2011.
For fiscal 2011, net cash provided by operating activities of $1.5 billion was primarily comprised of net income plus the
net effect of non-cash items. The primary working capital sources of cash were net income coupled with increases in deferred
revenue and accrued restructuring. Increases in deferred revenue related primarily to an overall increase in billing activity for
maintenance and support/upgrade plans, hosted and professional services and site and term licenses. Accrued restructuring increased
primarily due to recognition of liabilities related to employee termination and facility exit costs associated with the Fiscal 2011
Restructuring Plan which occurred in the fourth quarter of fiscal 2011 for which a majority was paid and adjusted in the first and
second quarters of fiscal 2012.
The primary working capital uses of cash for fiscal 2011 were increases in trade receivables coupled with decreases in
accrued expenses and taxes payable. Trade receivables increased primarily as a result of overall higher sales levels and billing
occurring during the latter half of the fourth quarter of fiscal 2011, offset in part by an increased rate of collection for Digital
Marketing services. Decreases in accrued expenses were primarily related to lower accrued bonus levels in fiscal 2011, coupled
with payment of our second and third semi-annual interest payments associated with our Notes totaling $62.3 million. The resulting
reduction in accrued interest was partially offset by additional interest accruals made during the period. Taxes payable decreased
primarily due to the resolution of a Canadian Tax audit offset in part by quarterly increases to the tax provision in excess of taxes
paid.
Table of Contents