Expedia 2010 Annual Report Download - page 89

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During 2010, we began investing in investment grade corporate debt securities all of which are classified as
available for sale. As of December 31, 2010, we had $81 million of short-term and $163 million of long-term
available for sale investments and the amortized cost basis of these investments approximated their fair value
with gross unrealized gains of $1 million and gross unrealized losses of less than $1 million. Proceeds from sales
and maturities of available-for-sale securities were $8 million for the year ended December 31, 2010 and realized
gains and losses on sales were immaterial.
We also hold time deposit investments with financial institutions. Time deposits with original maturities of
less than 90 days are classified as cash equivalents and those with remaining maturities of less than one year are
classified within short-term investments. Of the total time deposit investments, $88 million related to balances
held by our majority-owned subsidiaries as of December 31, 2010 and the entire balance as of December 31,
2009 was held by our majority-owned subsidiaries.
We use foreign currency forward contracts to economically hedge certain merchant revenue exposures and
in lieu of holding certain foreign currency cash for the purpose of economically hedging our foreign currency-
denominated operating liabilities. As of December 31, 2010, we were party to outstanding forward contracts
hedging our liability and revenue exposures with a total net notional value of $96 million. We had a net forward
liability of $1 million as of December 31, 2010 recorded in accrued expenses and other current liabilities and a
net forward asset of less than $1 million recorded in prepaid and other current assets as of December 31, 2009.
We recorded $6 million in net gains, $32 million in net gains and $56 million in net losses from foreign currency
forward contracts in 2010, 2009 and 2008.
NOTE 5 — Property and Equipment, Net
Our property and equipment consists of the following:
December 31,
2010 2009
(In thousands)
Capitalized software development ................................. $419,046 $ 355,088
Computer equipment ........................................... 130,137 100,451
Furniture and other equipment .................................... 82,767 65,098
Leasehold improvements ........................................ 75,615 68,832
707,565 589,469
Less: accumulated depreciation ................................... (459,371) (372,050)
Projects in progress ............................................. 28,867 19,401
Property and equipment, net ...................................... $277,061 $ 236,820
As of December 31, 2010 and 2009, our recorded capitalized software development costs, net of
accumulated amortization, were $150 million and $125 million. For the years ended December 31, 2010, 2009,
and 2008, we recorded amortization of capitalized software development costs of $69 million, $63 million, and
$47 million, most of which is included in technology and content expenses.
NOTE 6 — Goodwill and Intangible Assets, Net
The following table presents our goodwill and intangible assets as of December 31, 2010 and 2009:
December 31,
2010 2009
(In thousands)
Goodwill ................................................... $3,642,360 $3,603,994
Intangible assets with indefinite lives ............................. 688,836 690,028
Intangible assets with definite lives, net ........................... 108,871 133,003
$4,440,067 $4,427,025
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