Netgear 2012 Annual Report Download - page 11

Table of Contents
maintain and protect our proprietary rights. We hold 73 issued United States patents that expire between years 2013 and 2028 and 20 foreign patents
that expire between 2012 and 2026. In addition, we currently have a number of pending United States and foreign patent applications related to
technology and products offered by us. We also rely on third-
party licensors for patented hardware and software license rights in technology that are
incorporated into and are necessary for the operation and functionality of our products. Our success will depend in part on our continued ability to
have access to these technologies.
We have trade secret rights for our products, consisting mainly of product design, technical product documentation and software. We also own,
or have applied for registration of trademarks, in connection with our products in the United States and internationally, including NETGEAR, the
NETGEAR logo, NETGEAR Green, the NETGEAR Green logo, NETGEAR Digital Entertainer, the NETGEAR Digital Entertainer logo, Genie, the
Genie logo, ReadyShare, Neo TV, the Neo TV logo, NETGEAR Stora, the NETGEAR Stora logo, Connect with Innovation, ProSafe, RangeMax,
ReadyNAS, ReadyDrop, ReadyData, ReadyCloud, Smart Wizard, ProSecure, the ProSecure logo, Push2TV, Ultraline, Proline, Liteline, Envoy
Service Management System, Versalink, Wirespeed, Leaf Networks, NeoMedia, Centria, On Networks, Folio, Wifi Works, My Media, and X-
RAID.
We have registered a number of Internet domain names that we use for electronic interaction with our customers including dissemination of product
information, marketing programs, product registration, sales activities, and other commercial uses.
Seasonal Business
We have historically experienced increased net sales in our third and fourth fiscal quarters as compared to other quarters in our fiscal year due
to seasonal demand of consumer markets related to the beginning of the school year and the holiday season. However, because of irregular and
significant purchases from customers in other markets, such as the service provider market, this pattern has not been consistent. As such, any pattern
should not be considered a reliable indicator of our future net sales or financial performance.
Backlog
We believe the actual amount of product backlog at any particular time is not a meaningful indication of our future business. Our backlog
consists of products for which customer purchase orders have been received and that are scheduled or in the process of being scheduled for shipment.
While we expect to fulfill the order backlog within the current year, most orders are subject to rescheduling or cancellation with little or no penalties.
Because of the possibility of customer changes in product scheduling or order cancellation, our backlog as of any particular date may not be an
indicator of net sales for any subsequent period. Accordingly, backlog should not be considered a reliable indicator of our ability to achieve any
particular level of revenue or financial performance.
Environmental Laws
Our products and manufacturing process are subject to numerous governmental regulations, which cover both the use of various materials as
well as environmental concerns. Environmental issues such as pollution and climate change have had significant legislative and regulatory efforts on
a global basis, and there are expected to be additional changes to the regulations in these areas. These changes could directly increase the cost of
energy which may have an impact on the way we manufacture products or utilize energy to produce our products. In addition, any new regulations or
laws in the environmental area might increase the cost of raw materials we use in our products and the cost of compliance. Other regulations in the
environmental area may require us to continue to monitor and ensure proper disposal or recycling of our products. To the best of our knowledge, we
maintain compliance with all current government regulations concerning our production processes, for all locations in which we operate. Since we
operate on a global basis, this is also a complex process which requires continual monitoring of regulations and an ongoing compliance process to
ensure that we and our suppliers are in compliance with all existing regulations.
Employees
As of December 31, 2012 , we had 850 full-time employees, with 352 in sales, marketing and technical support, 251
in research and
development, 119 in operations, and 128
in finance, information systems and administration. We also utilize a number of temporary staff to
supplement our workforce. We have never had a work stoppage among our employees and no personnel are represented under collective bargaining
agreements.
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