VMware 2011 Annual Report Download - page 46

Download and view the complete annual report

Please find page 46 of the 2011 VMware annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 116

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116

Table of Contents
delivered and VSOE of fair value cannot be established, the revenue for the entire order is deferred until such time as all product delivery
future products or a lack of VSOE of fair value on the software maintenance element of the arrangement. Unearned software maintenance
revenues are recognized ratably over terms from one to five years with a weighted-average remaining term at December 31, 2011 of
generally recognized as the services are delivered. We believe our overall unearned revenue balance improves predictability of future revenues
and that it is a key indicator of the health and growth of our business.
Operating Expenses
Information about our operating expenses in the years ended 2011 , 2010 and 2009 is as follows:
For the Year Ended December 31, 2011
Core
Operating
Expenses
(1)
Stock-Based
Compensation
Capitalized
Software
Development
Costs, net
Other
Operating
Expenses
Total
Operating
Expenses
Cost of license revenue
$
74.9
$
1.6
$
84.7
$
46.2
$
207.4
Cost of services revenue
384.9
23.4
—
6.3
414.6
Research and development
661.9
174.3
(74.0
)
12.9
775.1
Sales and marketing
1,222.8
95.7
—
15.8
1,334.3
General and administrative
256.2
40.2
—
4.1
300.5
Total operating expenses
$
2,600.7
$
335.2
$
10.7
$
85.3
$
3,031.9
Operating income
$
735.2
Operating margin
19.5
%
For the Year Ended December 31, 2010
Core
Operating
Expenses
(1)
Stock-Based
Compensation
Capitalized
Software
Development
Costs, net
Other
Operating
Expenses
Total
Operating
Expenses
Cost of license revenue
$
52.4
$
1.7
$
99.5
$
23.9
$
177.5
Cost of services revenue
292.3
18.5
—
5.5
316.3
Research and development
537.8
164.4
(60.7
)
11.5
653.0
Sales and marketing
931.7
73.1
—
8.5
1,013.3
General and administrative
230.1
34.0
—
5.2
269.3
Total operating expenses
$
2,044.3
$
291.7
$
38.8
$
54.6
$
2,429.4
Operating income
$
428.0
Operating margin
15.0
%
For the Year Ended December 31, 2009
Core
Operating
Expenses
(1)
Stock-Based
Compensation
Capitalized
Software
Development
Costs, net
Other
Operating
Expenses
Total
Operating
Expenses
Cost of license revenue
$
30.8
$
1.3
$
82.9
$
11.7
$
126.7
Cost of services revenue
217.7
14.9
—
0.4
233.0
Research and development
441.6
121.8
(68.6
)
1.8
496.6
Sales and marketing
675.5
58.6
—
2.3
736.4
General and administrative
174.6
34.9
—
2.4
211.9
Total operating expenses
$
1,540.2
$
231.5
$
14.3
$
18.6
$
1,804.6
Operating income
$
219.3
Operating margin
10.8
%