Adobe 2015 Annual Report Download - page 51

Table of Contents
51
LIQUIDITY AND CAPITAL RESOURCES
This data should be read in conjunction with our Consolidated Statements of Cash Flows.
As of
(in millions) November 27,
2015 November 28, 2014
Cash and cash equivalents $ 876.6 $ 1,117.4
Short-term investments $ 3,111.5 $ 2,622.1
Working capital $ 2,608.3 $ 2,107.9
Stockholders’ equity $ 7,001.6 $ 6,775.9
A summary of our cash flows is as follows:
(in millions) Fiscal
2015 Fiscal 2014 Fiscal 2013
Net cash provided by operating activities $ 1,469.5 $ 1,287.5 $ 1,151.7
Net cash used for investing activities (1,488.4)(490.7)(1,177.8)
Net cash used for financing activities (200.7)(507.3)(559.1)
Effect of foreign currency exchange rates on cash and cash
equivalents (21.2)(6.7)(5.2)
Net increase (decrease) in cash and cash equivalents $ (240.8) $ 282.8 $ (590.4)
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 employee stock purchase plan. 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 2015, net cash provided by operating activities of $1.47 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, income taxes payable and trade payables. The increase in deferred revenue is primarily due to increased subscriptions
for our team, individual and enterprise Creative Cloud offerings and increases in Digital Marketing hosted services. The increase
in income taxes payable is primarily due to higher taxable income levels during fiscal 2015. Trade payables increased primarily
due to the timing of payments to web services vendors as certain invoices were received in the final weeks of fiscal 2015. The
primary working capital uses of cash were increases in trade receivables which were principally due to higher revenue levels.
For fiscal 2014, net cash provided by operating activities of $1.29 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 expenses. The increase in deferred revenue was primarily due to increased subscription and ETLA activity
for our individual, team and enterprise Creative Cloud offerings and increases in Digital Marketing and Digital Publishing hosted
services, offset in part by decreases in billings for our maintenance and Creative product software upgrade plans which we
discontinued in January 2013. Accrued expenses increased primarily due to accruals for contract terminations and employee
transition payments associated with business realignment initiatives implemented in the fourth quarter of fiscal 2014.
For fiscal 2013, net cash provided by operating activities of $1.15 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 expenses and decreases in trade receivables. Deferred revenue increased primarily due to increased
subscription and ETLA activity for our Creative Cloud offering and increases in Digital Marketing hosted services, offset in part
by decreases in billings for our maintenance and Creative product software upgrade plans which were discontinued in January
2013. Accrued expenses increased primarily due to amounts due under our fiscal 2013 annual incentive plan and sales commission
accruals associated with higher achievement levels. Trade receivables declined primarily due to lower perpetual license revenue
levels and improved collections compared to the fourth quarter of fiscal 2012.
The primary working capital uses of cash for fiscal 2013 were decreases in taxes payable and increases in prepaid expenses
and other assets. The decrease in taxes payable was largely attributed to tax payments made combined with audit settlement
adjustments, offset in part by tax expense and other adjustments during fiscal 2013. Prepaid expenses and other assets increased
primarily due to increases in short-term income tax receivables related to the carryback of federal research and development and
foreign tax credits in the fourth quarter of fiscal 2013.