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CITRIX SYSTEMS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
In addition to evaluating the Company’s profitability by geography, including the Company’s Online
Services division, its CODM also evaluates revenues by product groupings. Accordingly, the following table
presents revenues for Product licenses, License updates and product related Technical services by product
grouping for the Company’s Application Virtualization products, Application Networking products and other
products and Online services revenues for the Online Services division’s products, for the years ended:
December 31,
2007 2006 2005
(In thousands)
Net revenues:
Application Virtualization revenues .......................... $ 998,188 $ 871,656 $776,793
Online Services division revenues ............................ 213,744 148,795 99,097
Application Networking revenues ............................ 155,385 109,209 30,680
Other ................................................... 24,625 4,659 2,152
Total net revenue ..................................... $1,391,942 $1,134,319 $908,722
13. DERIVATIVE FINANCIAL INSTRUMENTS
As of December 31, 2007 and December 31, 2006, the Company had $11.7 million and $7.4 million of
derivative assets, respectively, and $5.9 million and $2.8 million of derivative liabilities, respectively,
representing the fair values of the Company’s outstanding derivative instruments, which are recorded in other
current assets, other assets, accrued expenses and other liabilities in the accompanying condensed consolidated
balance sheets. As of December 31, 2007, the Company’s derivative assets and liabilities primarily resulted from
cash flow hedges related to its forecasted operating expenses transacted in local currencies. The change in the
derivative component in accumulated other comprehensive income includes unrealized gains or losses that arose
from changes in market value of derivatives that were held during the period, and gains or losses that were
previously unrealized, but have been recognized in current period net income due to termination or maturities of
derivative contracts. This reclassification has no effect on total comprehensive income or stockholders’ equity.
The following table presents these components of accumulated other comprehensive income, net of tax for the
Company’s derivative instruments (in thousands):
For the Year Ended December 31,
2007 2006 2005
Unrealized gains (losses) on derivative instruments .................. $ 9,144 $ 6,395 $ (10,230)
Reclassification of realized (losses) gains .......................... (7,623) 2,011 (1,255)
Net change in other comprehensive income due to derivative
instruments ................................................ $ 1,521 $ 8,406 $ (11,485)
The total cumulative unrealized gain on derivative instruments was $5.5 million and $3.9 million at
December 31, 2007 and 2006, respectively, and is included in accumulated other comprehensive income in the
accompanying consolidated balance sheets. A substantial amount of the net unrealized gain as of December 31,
2007 is expected to be recognized in income over the next twelve months at the same time the hedged item is
recognized in income.
Cash Flow Hedges. At December 31, 2007 and 2006, the Company had in place foreign currency forward
sale contracts with a notional amount of $104.3 million and $56.0 million, respectively, and foreign currency
forward purchase contracts with a notional amount of $311.1 million and $220.0 million, respectively. The fair
value of these contracts at December 31, 2007 and 2006 were assets of $11.7 million and $7.4 million,
F-42