Blizzard 2014 Annual Report Download - page 53

ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION
(Amounts in millions)
1 TTMrepresentstrailingtwelvemonths.OperatingCashFlowforthethreemonthsendedDecember31,2012,threemonthsendedSeptember30,2012,
 threemonthsendedJune30,2012,andthreemonthsendedMarch31,2012was$976million,$122million,$93million,and$154million,respectively.
 CapitalexpendituresforthethreemonthsendedDecember31,2012,threemonthsendedSeptember30,2012,threemonthsendedJune30,2012,and
 threemonthsendedMarch31,2012was$27million,$21million,$17million,and$8million,respectively.
2Non-GAAPfreecashowrepresentsoperatingcashowminuscapitalexpenditures(whichincludespaymentforacquisitionofintangibleassets).
Year over Year
December 31, March 31, June 30, September 30, December 31, % Increase
Three Months Ended 2012 2013 2013 2013 2013 (Decrease)
Cash Flow Data
 OperatingCashFlow $ 976 $ 325 $ 109 $ (50) $ 880 (10)%
 CapitalExpenditures  27  17  19  22  16 (41)
 Non-GAAPFreeCashFlow2  949  308  90  (72)  864 (9)
 OperatingCashFlow-TTM1  1,345  1,516  1,532  1,360  1,264 (6)
 CapitalExpenditures-TTM1  73  82  84  85  74 1
 Non-GAAP
   FreeCashFlow-TTM1 $ 1,272 $ 1,434 $ 1,448 $ 1,275 $ 1,190 (6)%
Year over Year
March 31, June 30, September 30, December 31, % Increase
Three Months Ended 2014 2014 2014 2014 (Decrease)
Cash Flow Data
 OperatingCashFlow   $ 136 $ 106 $ (145) $ 1,195 36%
 CapitalExpenditures    37  25  28  17 6
 Non-GAAPFreeCashFlow2    99  81  (173)  1,178 36
 OperatingCashFlow-TTM1    1,075  1,072  977  1,292 2
 CapitalExpenditures-TTM1    94  100  106  107 45
 Non-GAAP
   FreeCashFlow-TTM1   $ 981 $ 972 $ 871 $ 1,185 (0)%
Less:
Net effect from Less: Less:
deferral of net Stock- Amortization
GAAP revenues and related based of intangible Non-GAAP
Year Ended December 31, 2012 Measurement cost of sales(a) compensation(b) assets(c) Measurement
NetRevenues $ 4,856 $ 131 $ — $ — $ 4,987
CostofSales-ProductCosts  1,116  —  —  —  1,116
CostofSales-OnlineSubscriptions  263  1  —  —  264
CostofSales-SoftwareRoyaltiesandAmortization  194  36  (9)  —  221
CostofSales-IntellectualPropertyLicenses  89  3  —  (30)  62
ProductDevelopment  604  —  (20)  —  584
SalesandMarketing  578  —  (8)  —  570
GeneralandAdministrative  561  —  (89)  —  472
TotalCostsandExpenses  3,405  40  (126)  (30)  3,289
(a) Reectsthenetchangeindeferredrevenuesandrelatedcostofsales.
(b) Includesexpenserelatedtostock-basedcompensation.
(c) Reectsamortizationofintangibleassetsfrompurchasepriceaccounting.
Thecompanycalculatesearningspersharepursuanttothetwo-classmethodwhichrequirestheallocationofnetincomebetweencommonshareholders
andparticipatingsecurityholders.NetincomeattributabletoActivisionBlizzardInc.commonshareholdersusedtocalculatenon-GAAPearningsper
commonshareassumingdilutionwas$870millionand$1,322millionforthethreemonthsandyearendedDecember31,2012ascomparedtototal
non-GAAPnetincomeof$891millionand$1,350millionforthesameperiods,respectively.
Thepershareadjustmentsarepresentedascalculated,andtheGAAPandnon-GAAPearningspershareinformationisalsopresentedascalculated.
Thesumofthesemeasures,aspresented,maydifferduetotheimpactofrounding.
ACTIVISION BLIZZARD, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO NON-GAAP MEASURES
(Amounts in millions, except earnings per share data)
Less:
Net effect from Less: Less:
deferral of net Stock- Amortization
GAAP revenues and related based of intangible Non-GAAP
Year Ended December 31, 2012 Measurement cost of sales(a) compensation(b) assets(c) Measurement
OperatingIncome  1,451  91  126  30  1,698
NetIncome  1,149  84  98  19  1,350
BasicEarningsperShare  1.01  0.07  0.09  0.02  1.19
DilutedEarningsperShare $ 1.01 $ 0.07 $ 0.09 $ 0.02 $ 1.18
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