UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)



þ	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended ~~October 2, 2015~~January 1, 2016



o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition Period from to

Commission File Number 000-17781

Symantec Corporation

(Exact name of the registrant as specified in its charter)



Delaware		77-0181864
(State or other jurisdiction of incorporation or organization)		(I.R.S. employer Identification no.)

350 Ellis Street,
Mountain View, California		94043
(Address of principal executive offices)		(zip code)

Registrant’s telephone number, including area code:

(650) 527-8000

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No þ

Shares of Symantec common stock, $0.01 par value per share, outstanding as of ~~October 30, 2015: 675,526,104~~January 29, 2016: 652,222,522 shares

Table of Contents

SYMANTEC CORPORATION

FORM 10-Q

Quarterly Period Ended ~~October 2, 2015~~January 1, 2016

TABLE OF CONTENTS



Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements	3
	Condensed Consolidated Balance Sheets as of ~~October 2, 2015~~January 1, 2016 and April 3, 2015	3
	Condensed Consolidated Statements of ~~Income~~Operations for the three and ~~six~~nine months ended ~~October~~January 1, 2016 and January 2, 2015 ~~and October 3, 2014~~	4
	Condensed Consolidated Statements of Comprehensive Income for the three and ~~six~~nine months ended ~~October~~January 1, 2016 and January 2, 2015 ~~and October 3, 2014~~	5
	Condensed Consolidated Statements of Cash Flows for the ~~six~~nine months ended ~~October~~January 1, 2016 and January 2, 2015 ~~and October 3, 2014~~	6
	Notes to Condensed Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	1820
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	2829
Item 4.	Controls and Procedures	2830
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	2931
Item 1A.	Risk Factors	2931
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2931
Item 6.	Exhibits	2931
Signatures		3032

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

SYMANTEC CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

October 2, 2015 April 3, 2015 *

(Unaudited)
(In millions, except par value)
ASSETS
Current assets:
Cash and cash equivalents $ 3,097
$ 2,874
Short-term investments 260
1,017
Accounts receivable, net 738
993
Deferred income taxes 207
152
Deferred commissions 112
131
Other current assets 250
255
Total current assets 4,664
5,422
Property and equipment, net 1,262
1,205
Intangible assets, net 572
628
Goodwill 5,847
5,847
Long-term deferred commissions 14
26
Other long-term assets 101
105
Total assets $ 12,460
$ 13,233

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable $ 326
$ 213
Accrued compensation and benefits 289
398
Deferred revenue 2,766
3,109
Current portion of long-term debt —
350
Other current liabilities 348
383
Total current liabilities 3,729
4,453
Long-term debt 1,740
1,746
Long-term deferred revenue 505
555
Long-term deferred tax liabilities 381
308
Long-term income taxes payable 132
134
Other long-term obligations 81
102
Total liabilities 6,568
7,298
Commitments and contingencies

Stockholders’ equity:
Common stock, $0.01 par value, 3,000 shares authorized; 680 and 898 shares issued; 680 and 684 shares outstanding, respectively 7
7
Additional paid-in capital 5,794
6,094
Accumulated other comprehensive income 88
104
Retained earnings (accumulated deficit) 3
(270 )
Total stockholders’ equity 5,892
5,935
Total liabilities and stockholders’ equity $ 12,460
$ 13,233

*Derived from audited financial statements.



	January 1, 2016		April 3, 2015
	(Unaudited) (In millions, except par value)
ASSETS
Current assets:
Cash and cash equivalents	$	2,213	$	2,843
Short-term investments	56		1,017
Accounts receivable, net	490		700
Deferred income taxes	223		152
Deferred commissions	52		64
Other current assets	189		231
Current assets held for sale	3,950		415
Total current assets	7,173		5,422
Property and equipment, net	986		950
Intangible assets, net	464		525
Goodwill	3,146		3,146
Long-term deferred commissions	11		9
Other long-term assets	156		71
Long-term assets held for sale	—		3,110
Total assets	$	11,936	$	13,233

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	241	$	169
Accrued compensation and benefits	203		232
Deferred revenue	2,180		2,427
Current portion of long-term debt	—		350
Other current liabilities	271		339
Current liabilities held for sale	932		936
Total current liabilities	3,827		4,453
Long-term debt	1,740		1,746
Long-term deferred revenue	366		444
Long-term deferred tax liabilities	399		308
Long-term income taxes payable	140		134
Other long-term obligations	70		79
Long-term liabilities held for sale	—		134
Total liabilities	6,542		7,298
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.01 par value, 3,000 shares authorized; 657 and 898 shares issued; 657 and 684 shares outstanding, respectively	7		7
Additional paid-in capital	5,239		6,094
Accumulated other comprehensive income	75		104
Retained earnings (accumulated deficit)	73		(270		)
Total stockholders’ equity	5,394		5,935
Total liabilities and stockholders’ equity	$	11,936	$	13,233

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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SYMANTEC CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF ~~INCOME~~OPERATIONS



	Three Months Ended						Nine Months Ended
	January 1, 2016			January 2, 2015			January 1, 2016			January 2, 2015
	(Unaudited)
	(In millions, except per share data)
Net revenues	$	909		$	970		$	2,727		$	3,057
Cost of revenues	150			177			468			551
Gross profit	759			793			2,259			2,506
Operating expenses:
Sales and marketing	308			403			984			1,265
Research and development	174			193			571			604
General and administrative	68			91			218			276
Amortization of intangible assets	13			21			41			66
Restructuring, separation, and transition	50			51			116			92
Total operating expenses	613			759			1,930			2,303
Operating income	146			34			329			203
Interest income	1			3			6			9
Interest expense	(17		)	(19		)	(56		)	(59		)
Other income (expense), net	(1		)	1			(3		)	6
Income from continuing operations before income taxes	129			19			276			159
Provision for income taxes	15			44			84			105
Income (loss) from continuing operations	114			(25		)	192			54
Income from discontinued operations, net of income taxes	56			247			251			648
Net income	$	170		$	222		$	443		$	702

Net income (loss) per share - basic:
Continuing operations	$	0.17		$	(0.04	)	$	0.28		$	0.08
Discontinued operations	$	0.08		$	0.36		$	0.37		$	0.94
Net income per share - basic	$	0.26		$	0.32		$	0.65		$	1.02

Net income (loss) per share - diluted:
Continuing operations	$	0.17		$	(0.04	)	$	0.28		$	0.08
Discontinued operations	$	0.08		$	0.36		$	0.37		$	0.93
Net income per share - diluted	$	0.25		$	0.32		$	0.65		$	1.01

Weighted-average shares outstanding:
Basic	665			689			677			690
Diluted	671			689			683			697
Cash dividends declared per common share	$	0.15		$	0.15		$	0.45		$	0.45

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 October 2, 2015 October 3, 2014
(Unaudited)
(In millions, except per share data)
Net revenue:
Content, subscription, and maintenance $ 1,333
$ 1,445
$ 2,685
$ 3,019
License 165
172
312
333
Total net revenue 1,498
1,617
2,997
3,352
Cost of revenue:
Content, subscription, and maintenance 225
240
444
509
License 29
25
51
52
Amortization of intangible assets 10
13
23
26
Total cost of revenue 264
278
518
587
Gross profit 1,234
1,339
2,479
2,765
Operating expenses:
Sales and marketing 516
565
1,037
1,209
Research and development 293
276
577
584
General and administrative 94
93
190
196
Amortization of intangible assets 17
27
36
56
Restructuring, separation, and transition 111
30
235
50
Total operating expenses 1,031
991
2,075
2,095
Operating income 203
348
404
670
Interest income 3
3
6
6
Interest expense (19 ) (19 ) (39 ) (40 )
Other income (expense), net 2
1
(9 ) 2
Income before income taxes 189
333
362
638
Provision for income taxes 33
89
89
158
Net income $ 156
$ 244
$ 273
$ 480
Net income per share:
Basic $ 0.23
$ 0.35
$ 0.40
$ 0.69
Diluted $ 0.23
$ 0.35
$ 0.40
$ 0.69
Weighted-average shares outstanding:
Basic 682
690
682
691
Diluted 687
696
689
697
Cash dividends declared per common share $ 0.15
$ 0.15
$ 0.30
$ 0.30
Note: Net income (loss) per share amounts may not add due to rounding.

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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SYMANTEC CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME


	Three Months Ended						Six Months Ended						Three Months Ended						Nine Months Ended
	October 2, 2015			October 3, 2014			October 2, 2015			October 3, 2014			January 1, 2016			January 2, 2015			January 1, 2016			January 2, 2015
	(Unaudited)												(Unaudited)
	(Dollars in millions)												(Dollars in millions)
Net income	$	156		$	244		$	273		$	480		$	170		$	222		$	443		$	702
Other comprehensive loss, net of taxes:
Foreign currency translation adjustments:
Translation adjustments	(34		)	(42		)	(22		)	(40		)	(11		)	(35		)	(33		)	(75		)
Reclassification adjustments for loss included in net income	1			—			1			—			—			—			1			—
Net foreign currency translation adjustments	(33		)	(42		)	(21		)	(40		)	(11		)	(35		)	(32		)	(75		)
Unrealized gain on available-for-sale securities, net of taxes of $3, $0, $3 and $0, respectively	5			—			5			—
Unrealized gain (loss) on available-for-sale securities, net of taxes of $(1), $0, $2 and $0, respectively													(2		)	—			3			—
Other comprehensive loss, net of taxes	(28		)	(42		)	(16		)	(40		)	(13		)	(35		)	(29		)	(75		)
Comprehensive income	$	128		$	202		$	257		$	440		$	157		$	187		$	414		$	627

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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SYMANTEC CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Six Months Ended						Nine Months Ended
	October 2, 2015			October 3, 2014			January 1, 2016			January 2, 2015
	(Unaudited)						(Unaudited)
	(Dollars in millions)						(Dollars in millions)
OPERATING ACTIVITIES:
Net income	$	273		$	480		$	443		$	702
Adjustments to reconcile net income to net cash provided by operating activities:
Income from discontinued operations							(251		)	(648		)
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation	143			145			161			173
Amortization of intangible assets	59			82			63			92
Amortization of debt issuance costs and discounts	2			2			3			3
Stock-based compensation expense	133			89			118			94
Deferred income taxes	17			30			63			29
Excess income tax benefit from the exercise of stock options	(6		)	(5		)	(6		)	(6		)
Other	9			3			14			8
Net change in assets and liabilities, excluding effects of acquisitions:
Accounts receivable, net	255			268			26			24
Deferred commissions	30			(3		)	10			(4		)
Accounts payable	50			(77		)	61			(69		)
Accrued compensation and benefits	(107		)	(50		)	(23		)	(2		)
Deferred revenue	(397		)	(374		)	(175		)	(199		)
Income taxes payable	(22		)	(101		)	(94		)	(237		)
Other assets	12			33			(49		)	18
Other liabilities	(17		)	(56		)	(48		)	(28		)
Net cash provided by (used in) continuing operating activities							316			(50		)
Net cash provided by discontinued operating activities							230			874
Net cash provided by operating activities	434			466			546			824
INVESTING ACTIVITIES:
Purchases of property and equipment	(149		)	(199		)	(225		)	(249		)
Payments for acquisitions, net of cash acquired	(4		)	(19		)
Payments for acquisitions, net of cash acquired, and purchases of intangibles							(4		)	(39		)
Purchases of short-term investments	(327		)	(1,071		)	(377		)	(1,429		)
Proceeds from maturities of short-term investments	1,019			411			1,038			495
Proceeds from sales of short-term investments	76			156			299			270
Net cash provided by (used in) continuing investing activities							731			(952		)
Net cash used in discontinued investing activities							(57		)	(51		)
Net cash provided by (used in) investing activities	615			(722		)	674			(1,003		)
FINANCING ACTIVITIES:
Repayments of debt and other obligations	(367		)	(18		)	(368		)	(19		)
Net proceeds from sales of common stock under employee stock benefit plans	44			66			63			78
Excess income tax benefit from the exercise of stock options	6			5			6			6
Tax payments related to restricted stock units	(37		)	(34		)	(35		)	(30		)
Dividends and dividend equivalents paid	(210		)	(207		)	(312		)	(311		)
Repurchases of common stock	(250		)	(250		)	(868		)	(375		)
Proceeds from other financing, net	—			34			—			36
Net cash used in continuing financing activities							(1,514		)	(615		)
Net cash used in discontinued financing activities							(17		)	(7		)
Net cash used in financing activities	(814		)	(404		)	(1,531		)	(622		)
Effect of exchange rate fluctuations on cash and cash equivalents	(12		)	(75		)	(51		)	(142		)
Change in cash and cash equivalents	223			(735		)	(362		)	(943		)
Beginning cash and cash equivalents	2,874			3,707			2,874			3,707
Ending cash and cash equivalents	$	3,097		$	2,972		2,512			2,764
Less: Cash and cash equivalents of discontinued operations							299			30
Cash and cash equivalents of continuing operations							$	2,213		$	2,734

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

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SYMANTEC CORPORATION

Notes to Condensed Consolidated Financial Statements

(Unaudited)

Note 1. Description of Business and Significant Accounting Policies

Business

Symantec Corporation (“Symantec,” “we,” “us,” “our,” and “the Company” refer to Symantec Corporation and all of its subsidiaries) is ~~an information protection expert that helps people, businesses and governments seeking the freedom to unlock the opportunities technology brings – anytime, anywhere.~~a global leader in security.

In the second quarter of fiscal 2016, wethe Company entered into a definitive agreement to sell the assets of ~~our~~its information management business ("Veritas") (which represented a reporting segment) to The Carlyle Group and certain co-investors ~~(“Carlyle”~~("Carlyle"). The ~~sale is expected to close by the end of~~agreement was amended in January 2016 and closed on January 29, 2016, see Note 13, Subsequent Events. Beginning in the third quarter of fiscal 2016, ~~subject to regulatory approvals~~the results of Veritas are presented as discontinued operations in our Condensed Consolidated Statements of Operations and ~~certain closing conditions, including~~thus have been excluded from continuing operations and segment results for all reported periods. Furthermore, the ~~operational separation, in all material respects, of the information management business.~~ ~~For~~related assets and liabilities have been classified as held for sale on our Condensed Consolidated Balance Sheets. See Note 3, Discontinued Operations, for additional information ~~about the planned divestiture of our information management business see Note 3.~~on discontinued operations.

Basis of presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles ("GAAP") in the United States of America ("U.S.") for interim financial information and with the instructions on Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). In accordance with those rules and regulations, we have omitted certain information and notes normally provided in our annual Consolidated Financial Statements. In the opinion of management, the unaudited Condensed Consolidated Financial Statements contain all adjustments, consisting only of normal recurring items, except as otherwise noted, necessary for the fair presentation of our financial position, results of operations, and cash flows for the interim periods. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and Notes thereto included in our Annual Report on Form 10-K for the fiscal year ended April 3, 2015. The results of operations for the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, are not necessarily indicative of the results expected for the entire fiscal year.

We have a 52/53-week fiscal accounting year. Unless otherwise stated, references to three and ~~six~~nine month ended periods in this report relate to fiscal periods ended ~~October~~January 1, 2016 and January 2, ~~2015 and October 3, 2014.~~2015. The ~~six~~nine months ended ~~October~~January 1, 2016, consisted of 39 weeks whereas the nine months ended January 2, 2015, consisted of ~~26 weeks whereas the six months ended October 3, 2014, consisted of 27~~40 weeks. Our 2016 fiscal year consists of 52 weeks and ends on April 1, 2016.

There have been no material changes in our significant accounting policies for the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, compared to the significant accounting policies described in our Annual Report on Form 10-K for the fiscal year ended April 3, 2015.

Recently adopted accounting guidance

In April 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2014-08, Presentation of Financial Statements and Property, Plant and Equipment, that provides new guidance related to reporting discontinued operations. This standard raises the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both discontinued operations and certain other disposals that do not meet the definition of a discontinued operation. The standard became effective for the Company in the first quarter of fiscal 2016, and ~~will apply~~applies to the presentation and disclosure of the ~~planned divestiture~~sale of ~~our information management business that is expected to close by the end of the third quarter of fiscal~~Veritas which closed in January 2016. ~~The accounting guidance will impact our financial statements by requiring additional disclosures related to the planned divestiture.~~ For additional information about ~~the planned divestiture~~our reporting of ~~our information management business~~discontinued operations, see Note 3.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation, which modifies the evaluation of whether limited partnerships and similar legal entities qualify as variable interest entities (“VIEs”). The new standard also affects the consolidation analysis of reporting entities that are involved with VIEs. We adopted the standard in the second quarter of fiscal 2016, and it did not have a material impact upon adoption. 3, Discontinued Operations.

In April 2015, the FASB issued ASU No. 2015-03, Interest–Imputation of Interest, which requires debt issuance costs to be presented as a direct deduction from the carrying amount of the related liability. We adopted the standard in the first quarter of fiscal 2016, and it did not have a material impact ~~upon adoption.~~on our Condensed Consolidated Financial Statements.

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Recent accounting guidance not yet adopted

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, that requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers and will replace most existing revenue recognition guidance in U.S. GAAP. The standard permits the use of either the retrospective or cumulative effect transition method. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date, which defers the effective date of the new revenue reporting standard by one year. The standard will be effective for the Company for the fiscal year beginning on March 31, 2018. ~~We are evaluating the effect that the standard will have on our Condensed Consolidated Financial Statements and related disclosures.~~ We have not yet selected a transition method nor have we determined the effect of the standard on our ~~ongoing financial reporting.~~

~~There is no other recently issued authoritative guidance that is expected to have a material impact to our~~ Condensed Consolidated Financial ~~Statements through~~Statements.

In November 2015, the FASB issued ASU No. 2015-17, Income Taxes, which simplifies the presentation of deferred income taxes by requiring that all deferred income tax liabilities and assets be classified as noncurrent. The amendments in this ASU are effective for reporting periods beginning after December 15, 2016, with early adoption permitted. The standard will be effective for the Company for the fiscal quarter ended April 1, 2016. The Company intends to adopt this standard on a prospective basis, and believes there will be a material balance sheet reclassification of current deferred income tax liabilities and assets to noncurrent, but cannot determine the exact amount at this time.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. The new guidance enhances the reporting ~~date.~~model for financial instruments, which includes amendments to address aspects of recognition, measurement, presentation and disclosure. The update to the standard is effective for the Company for the fiscal year beginning March 31, 2018, with early adoption permitted under limited circumstances. The Company is currently evaluating the effect the standard will have on its Condensed Consolidated Financial Statements.

Note 2. Fair Value Measurements

For assets and liabilities measured at fair value, such amounts are based on an expected exit price representing the amount that would be received on the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value:

Level 1: Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2: Observable inputs that reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3: Unobservable inputs reflecting our own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.

Assets measured and recorded at fair value on a recurring basis

Cash equivalents. Cash equivalents consist primarily of money market funds with original maturities of three months or less at the time of purchase, and the carrying amount is a reasonable estimate of fair value.

Short-term investments. Short-term investments consist of investment securities with original maturities greater than three months and marketable equity securities. Investment securities are priced using inputs such as actual trade data, benchmark yields, broker/dealer quotes, and other similar data, which are obtained from quoted market prices, independent pricing vendors, or other sources, to determine the fair value of these assets. Marketable equity securities are recorded at fair value using quoted prices in active markets for identical assets.

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There have been no transfers between fair value measurement levels during the ~~six~~nine months ended ~~October 2, 2015.~~January 1, 2016. The following table summarizes our assets measured at fair value on a recurring basis, by level, within the fair value hierarchy:

~~Table of Contents~~


	October 2, 2015						April 3, 2015						January 1, 2016						April 3, 2015
	Fair Value		Cash and Cash Equivalents		Short-term Investments		Fair Value		Cash and Cash Equivalents		Short-term Investments		Fair Value		Cash and Cash Equivalents		Short-term Investments		Fair Value		Cash and Cash Equivalents		Short-term Investments
	(Dollars in millions)												(Dollars in millions)
Cash	$	1,608	$	1,608	$	—	$	807	$	807	$	—	$	889	$	889	$	—	$	776	$	776	$	—
Non-negotiable certificates of deposit	—		—		—		296		260		36		—		—		—		296		260		36
Level 1
Money market	1,411		1,411		—		1,725		1,725		—		1,324		1,324		—		1,725		1,725		—
U.S. government securities	75		—		75		284		—		284		25		—		25		284		—		284
Marketable equity securities	12		—		12		5		—		5		10		—		10		5		—		5
	1,498		1,411		87		2,014		1,725		289		1,359		1,324		35		2,014		1,725		289
Level 2
Corporate bonds	105		5		100		166		—		166		8		—		8		166		—		166
U.S. agency securities	21		—		21		68		—		68		3		—		3		68		—		68
Commercial paper	64		44		20		333		82		251		10		—		10		333		82		251
Negotiable certificates of deposit	20		—		20		184		—		184		—		—		—		184		—		184
International government securities	41		29		12		23		—		23		—		—		—		23		—		23
	251		78		173		774		82		692		21		—		21		774		82		692
Total	$	3,357	$	3,097	$	260	$	3,891	$	2,874	$	1,017	$	2,269	$	2,213	$	56	$	3,860	$	2,843	$	1,017

Fair value of debt

As of ~~October 2, 2015~~January 1, 2016 and April 3, 2015, the total fair value of our current and long-term debt was $1.8 billion and $2.2 billion, respectively, based on Level 2 inputs.

Note 3. ~~Planned Divestiture of Information Management Business~~Discontinued Operations

In the second quarter of fiscal 2016, wethe Company entered into a definitive agreement to sell the assets of our information management business to Carlyle for cash consideration of approximately $8.0 billion and the assumption of certain liabilities, subject to specified adjustments. The divestiture of our information management business will help us accelerate our unified security strategy, provide a stronger financial foundation for strategic investments, and return additional cash to our shareholders through a combination of share repurchases and dividends. The sale is expected to close by the end of the third quarter of fiscal 2016, subject to regulatory approvals and certain closing conditions, including the operational separation, in all material respects, of the information management business.

The Company and Carlyle have made customary representations and warranties and have agreed to customary covenants related to the sale. Subject to certain limitations, the Company and Carlyle have agreed to indemnify each other for losses arising from certain breaches of the agreement, certain tax liabilities and certain other liabilities.

We are in the process of evaluating the transaction and its impact on our Condensed Consolidated Financial Statements, including evaluating the resulting net gain and income tax expense that will be recognized, based on all the terms of the agreement. The Company's U.S. and foreign income taxes payable resulting from the transaction are estimated to range from $1.3 billion to $1.7 billion.

~~As of October 2, 2015, our information management business did not meet the criteria to be classified as held for sale, as Symantec did not have the ability to transfer~~ its information management business, Veritas, to ~~Carlyle~~Carlyle. The agreement was amended in ~~its present condition. The sale is conditioned~~January 2016 and closed on ~~multiple milestones that were not completed as of October 2, 2015, for the Company’s completion of the operational separation,~~January 29, 2016, see Note 13, Subsequent Events. Beginning in ~~all material respects, of the information management business. We expect that effective beginning with~~ the third quarter of fiscal 2016, the ~~financial~~ results of ~~our information management business will be~~Veritas are presented as discontinued operations ~~on the~~in our Condensed Consolidated ~~Financial~~ Statements ~~as we expect then to meet~~of Operations and thus have been excluded from continuing operations and segment results for all reported periods. Furthermore, the ~~criteria for the information management business to be~~related assets and liabilities have been classified as held for ~~sale. Subsequently, we will have~~sale on our Condensed Consolidated Balance Sheets. The Company has two remaining reporting segments, Consumer Security and Enterprise Security. See Note 8, Segment Information, for more information on our operating segments. See Note 6, Restructuring, Separation, and Transition, for more information on severance, facilities and separation costs related to our fiscal 2015 plans to separate our security and information management businesses.

The Company and Veritas entered into Transition Service Agreements ("TSA") pursuant to which the Company will provide Veritas certain limited services including financial support services, information technology services, and access to facilities, and Veritas will provide the Company financial support services. The TSAs commence with the close of the transaction and expire at various dates through fiscal year 2019.

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The following table presents the aggregate carrying amounts of the classes of assets and liabilities held for sale:



	January 1, 2016		April 3, 2015
	(Dollars in millions)
Assets:
Cash and cash equivalents	$	299	$	31
Accounts receivable, net	417		293
Deferred commissions	57		67
Other current assets	44		24
Property and equipment, net	300		255
Intangible assets, net	87		103
Goodwill	2,699		2,701
Long-term deferred commissions	12		17
Other long-term assets	35		34
Total assets held for sale	$	3,950	$	3,525

Liabilities:
Accounts payable	$	76	$	44
Accrued compensation and benefits	131		166
Deferred revenue	561		682
Other current liabilities	44		44
Long-term deferred revenue	98		111
Other long-term obligations	22		23
Total liabilities held for sale	$	932	$	1,070

The following table presents information regarding certain components of income from discontinued operations, net of income taxes:



	Three Months Ended				Nine Months Ended
	January 1, 2016		January 2, 2015		January 1, 2016		January 2, 2015
	(Dollars in millions)
Net revenues	$	570	$	668	$	1,749	$	1,933
Cost of revenues	92		102		292		315
Operating expenses	377		273		1,135		824
Other income (expense), net	8		—		2		(3		)
Income from discontinued operations before income tax	109		293		324		791
Provision for income taxes	53		46		73		143
Net income from discontinued operations	$	56	$	247	$	251	$	648

Note 4. Goodwill and Intangible Assets

Goodwill

The changes in the carrying amount of goodwill are as follows:


	Consumer Security		Enterprise Security		Information Management			Total		Consumer Security		Enterprise Security			Total
	(Dollars in millions)									(Dollars in millions)
Net balance as of April 3, 2015	$	1,230	$	1,916	$	2,701		$	5,847	$	1,230	$	1,916		$	3,146
Translation adjustments	—		2		(2		)	—		1		(1		)	—
Net balance as of October 2, 2015	$	1,230	$	1,918	$	2,699		$	5,847
Net balance as of January 1, 2016										$	1,231	$	1,915		$	3,146

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Intangible assets, net


	October 2, 2015							April 3, 2015							January 1, 2016							April 3, 2015
	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
	(Dollars in millions)														(Dollars in millions)
Customer relationships	$	531	$	(369	)	$	162	$	730	$	(536	)	$	194	$	402	$	(304	)	$	98	$	637	$	(498	)	$	139
Developed technology	251		(147		)	104		296		(172		)	124		155		(90		)	65		200		(117		)	83
Finite-lived trade names	14		(9		)	5		125		(117		)	8		2		(1		)	1		21		(19		)	2
Patents	21		(17		)	4		21		(16		)	5		21		(18		)	3		21		(17		)	4
Total finite-lived intangible assets	817		(542		)	275		1,172		(841		)	331		580		(413		)	167		879		(651		)	228
Indefinite-lived trade names	297		—			297		297		—			297		297		—			297		297		—			297
Total	$	1,114	$	(542	)	$	572	$	1,469	$	(841	)	$	628	$	877	$	(413	)	$	464	$	1,176	$	(651	)	$	525

Goodwill and intangible assets to be disposed of as a result of our sale of Veritas were included in assets held for sale in our Condensed Consolidated Balance Sheets as of January 1, 2016 and April 3, 2015, and accordingly, are excluded from the tables above.

As of ~~October 2, 2015,~~January 1, 2016, future amortization expense related to finite-lived intangible assets by fiscal year is as follows:


	October 2, 2015		January 1, 2016
	(Dollars in millions)		(Dollars in millions)
Remainder of 2016	$	53	$	19
2017	94		67
2018	72		51
2019	37		24
2020	15		5
Thereafter	4		1
Total	$	275	$	167

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Note 5. Debt

The following table summarizes components of our debt:


	October 2, 2015					April 3, 2015					January 1, 2016					April 3, 2015
	Amount			Effective Interest Rate		Amount			Effective Interest Rate		Amount			Effective Interest Rate		Amount			Effective Interest Rate
	(Dollars in millions)										(Dollars in millions)
Senior Notes
2.75% due September 15, 2015	$	—		—	%	$	350		2.76	%	$	—		—	%	$	350		2.76	%
2.75% due June 15, 2017	600			2.79	%	600			2.79	%	600			2.79	%	600			2.79	%
4.20% due September 15, 2020	750			4.25	%	750			4.25	%	750			4.25	%	750			4.25	%
3.95% due June 15, 2022	400			4.05	%	400			4.05	%	400			4.05	%	400			4.05	%
Total principal amount	$	1,750				$	2,100				1,750					2,100
Less: unamortized discount and issuance costs	(10		)			(4		)			(10		)			(4		)
Total debt	$	1,740				$	2,096				1,740					2,096
Less: current portion	—					(350		)			—					(350		)
Total long-term portion	$	1,740				$	1,746				$	1,740				$	1,746

Senior Notes

Our Senior Notes are senior unsecured obligations that rank equally in right of payment with all of our existing and future unsecured, unsubordinated obligations and are redeemable by us at any time, subject to a “make-whole” premium. Interest on our Senior Notes is payable semiannually. Both the discount and issuance costs are being amortized as incremental interest expense over the respective terms of the Senior Notes. The principal balance of our 2.75% Senior Notes due September 15, 2015 matured and was settled by a cash payment of $350 million in the ~~three months ended October 2, 2015.~~second quarter of fiscal 2016.

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Revolving credit facility

In fiscal 2011, we entered into a $1.0 billion senior unsecured revolving credit facility (“credit facility”), which was amended in fiscal 2013. The amendment extended the term of the credit facility to June 7, 2017. Loans under the credit facility will bear interest, at our option, at a rate equal to either a) LIBOR plus a margin based on debt ratings, as defined in the credit facility agreement or b) the bank’s base rate plus a margin based on debt ratings, as defined in the credit facility agreement. Under the terms of the credit facility, we must comply with certain financial and non-financial covenants, including a covenant to maintain a specified ratio of debt to EBITDA (earnings before interest, taxes, depreciation and amortization). As of ~~October 2, 2015,~~January 1, 2016, we were in compliance with the required covenants, and no amounts were outstanding.

Note 6. Restructuring, Separation, and Transition

Our restructuring, separation, and transition costs and liabilities consist primarily of severance, facilities, separation, transition and other related costs. Severance costs generally include severance payments, outplacement services, health insurance coverage, and legal costs. Facilities costs generally include rent expense and lease termination costs, less estimated sublease income. Separation and other related costs include advisory, consulting and other costs incurred in connection with the separation of our information management business. Transition and other related costs primarily consist of consulting charges associated with the implementation of new ~~Enterprise Resource Planning~~enterprise resource planning systems. Restructuring, separation, and transition costs are managed at the corporate level and are not allocated to our reportable segments. See Note 8, Segment Information, of these Condensed Consolidated Financial Statements for information regarding the reconciliation of total segment operating income to total consolidated operating income.

Restructuring plans

Fiscal 2014 Plan

We initiated a restructuring plan in the fourth quarter of fiscal 2013 to reduce management and redundant personnel resulting in headcount reductions across the Company. As of ~~October 2, 2015,~~January 1, 2016, the related costs for severance and benefits are substantially complete; however, we may experience immaterial adjustments to existing accruals in subsequent periods.

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Fiscal 2015 Plan

In fiscal 2015, we announced plans to separate our security and information management businesses. In order to separate the businesses, we ~~initiated~~put a restructuring plan in place to properly align personnel, and ~~are incurring~~have therefore incurred associated severance and facilities costs. We ~~are~~ also ~~incurring~~incurred separation costs in the form of advisory, consulting and disentanglement expenses. These actions were completed in the fourth quarter of fiscal 2016 with the sale of Veritas on January 29, 2016. Total restructuring and separation costs in the fourth quarter of fiscal 2016 are expected to be ~~substantially completed by the end~~$30 million to $40 million, excluding advisor fees of ~~the third quarter of fiscal 2016. Total remaining restructuring and separation costs are expected to be between $50~~approximately $40 million ~~and $100 million, excluding tax implications and potential advisor fees~~ payable upon separation. See Note 3, Discontinued Operations, and Note 13, Subsequent Events, for more information on the sale of Veritas. As of ~~October 2, 2015,~~January 1, 2016, liabilities for excess facility obligations at several locations around the world are expected to be paid throughout the respective lease terms, ~~as we continue to occupy these facilities,~~ the longest of which extends through fiscal ~~2019.~~2020.

Restructuring, separation, and transition expense summary


	Three Months Ended October 2, 2015		Six Months Ended October 2, 2015		Three Months Ended January 1, 2016		Nine Months Ended January 1, 2016
	(Dollars in millions)				(Dollars in millions)
Fiscal 2015 Plan
Severance costs	$	—	$	21	$	14	$	31
Separation costs	73		136		4		5
Other exit and disposal costs	3		4		15		19
Fiscal 2015 Plan Total	76		161		33		55
Transition and other related costs	35		74		17		61
Restructuring, separation, and transition costs from continuing operations					50		116
Restructuring, separation, and transition costs from discontinued operations					64		233
Total restructuring, separation, and transition costs	$	111	$	235	$	114	$	349

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Restructuring, separation, and transition liabilities summary


	April 3, 2015		Costs, Net of Adjustments		Cash Payments			October 2, 2015		Cumulative Incurred to Date		April 3, 2015		Costs, Net of Adjustments		Cash Payments			January 1, 2016		Cumulative Incurred to Date
	(Dollars in millions)											(Dollars in millions)
Fiscal 2014 Plan total	$	4	$	—	$	(3	)	$	1	$	238	$	4	$	—	$	(4	)	$	—	$	238
Fiscal 2015 Plan
Severance costs	59		21		(58		)	22		123		59		36		(74		)	21		138
Separation costs	17		136		(104		)	49		217		17		189		(160		)	46		270
Other exit and disposal costs	6		4		(4		)	6		11		6		19		(11		)	14		26
Fiscal 2015 Plan total	$	82	$	161	$	(166	)	$	77	$	351	$	82	$	244	$	(245	)	$	81	$	434
Restructuring and separation plans total	$	86	$	161	$	(169	)	$	78			$	86	244		$	(249	)	$	81
Transition and other related costs			74											105
Total restructuring, separation, and transition costs			$	235										$	349

The restructuring and separation liabilities shown above remain with the Company in continuing operations and are included in accounts payable, other current liabilities and other long-term obligations in our Condensed Consolidated Balance Sheets.

Note 7. Commitments and Contingencies

Indemnifications

In the ordinary course of business, we may provide indemnifications of varying scope and terms to customers, vendors, lessors, business partners, subsidiaries and other parties with respect to certain matters, including, but not limited to, losses arising out of our breach of agreements or representations and warranties made by us. In addition, our bylaws contain indemnification obligations to our directors, officers, employees and agents, and we have entered into indemnification agreements with our directors and certain of our officers to give such directors and officers additional contractual assurances regarding the scope of the indemnification set forth in our bylaws and to provide additional procedural protections. We maintain director and officer insurance, which may cover certain liabilities arising from our obligation to indemnify our directors and officers. It is not possible to determine the aggregate maximum potential loss under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Such indemnification agreements might not be subject to maximum loss clauses. Historically, we have

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not incurred material costs as a result of obligations under these agreements and we have not accrued any liabilities related to such indemnification obligations in our Condensed Consolidated Financial Statements.

We provide limited product warranties and the majority of our software license agreements contain provisions that indemnify licensees of our software from damages and costs resulting from claims alleging that our software infringes on the intellectual property rights of a third party. Historically, payments made under these provisions have been immaterial. We monitor the conditions that are subject to indemnification to identify if a loss has occurred.

Litigation contingencies

GSA

During the first quarter of fiscal 2013, we were advised by the Commercial Litigation Branch of the Department of Justice’s Civil Division and the Civil Division of the U.S. Attorney’s Office for the District of Columbia that the government is investigating our compliance with certain provisions of our U.S. General Services Administration (“GSA”) Multiple Award Schedule Contract No. GS-35F-0240T effective January 24, 2007, including provisions relating to pricing, country of origin, accessibility, and the disclosure of commercial sales practices.

As reported on the GSA’s publicly-available database, our total sales under the GSA Schedule contract were approximately $222 million from the period beginning January 2007 and ending September 2012. We have fully cooperated with the government throughout its investigation and in January 2014, representatives of the government indicated that their initial analysis of our actual damages exposure from direct government sales under the GSA schedule was approximately $145 million; since the initial meeting, the government’s analysis of our potential damages exposure relating to direct sales has increased. The government has also indicated they are going to pursue claims for certain sales to New York, California, and Florida as well as sales to the federal government through reseller GSA Schedule contracts, which could significantly increase our potential damages exposure.

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In 2012, a sealed civil lawsuit was filed against Symantec related to compliance with the GSA Schedule contract and contracts with California, Florida, and New York. On July 18, 2014, the Court-imposed seal expired, and the government intervened in the lawsuit. On September 16, 2014, the states of California and Florida intervened in the lawsuit, and the state of New York notified the Court that it would not intervene. On October 3, 2014, the Department of Justice filed an amended complaint, which did not state a specific damages amount. On October 17, 2014, California and Florida combined their claims with those of the Department of Justice and the relator on behalf of New York in an Omnibus ~~Complaint;~~Complaint, and a First Amended Omnibus Complaint was filed on October 8, 2015; the state claims also do not state specific damages amounts.

It is possible that the litigation could lead to claims or findings of violations of the False Claims Act, and could be material to our results of operations and cash flows for any period. Resolution of False Claims Act investigations can ultimately result in the payment of somewhere between one and three times the actual damages proven by the government, plus civil penalties in some cases, depending upon a number of factors. Our current estimate of the low end of the range of the probable estimated loss from this matter is $25 million, which we have accrued. This amount contemplates estimated losses from both the investigation of compliance with the terms of the GSA Schedule contract as well as possible violations of the False Claims Act. There is at least a reasonable possibility that a loss may have been incurred in excess of our accrual for this matter, however, we are currently unable to determine the high end of the range of estimated losses resulting from this matter.

On December 8, 2010, Intellectual Ventures ("IV") sued Symantec for patent infringement in the U.S. District Court in Delaware. The complaint alleged infringement by various Symantec internet security products. On February 6, 2015, the jury issued a verdict and subsequent Court decisions invalidated some of the patents-in-suit, therefore leaving an $8 million damages verdict; through a post-trial motion, Symantec is seeking to overturn that verdict. Symantec does not believe that it is probable that it has incurred a material loss and, as a result, has not made an accrual for this matter.

EDS & NDI

On January 24, 2011, a class action lawsuit was filed against the Company and its previous e-commerce vendor Digital River, Inc.; the lawsuit alleged violations of California’s Unfair Competition Law, the California Legal Remedies Act and unjust enrichment related to prior sales of Extended Download Service ("EDS") and Norton Download Insurance ("NDI"). On March 31, 2014, the U.S. District Court for the District of Minnesota certified a class of all people who purchased these products between January 24, 2005, and March 10, 2011. In August 2015, the parties executed a settlement agreement pursuant to which the Company would pay the plaintiffs $30 million, which we accrued. On October 8, 2015, the Court granted approval of the settlement, which was subsequently paid by the Company. A final approval hearing was held on January 19, 2016, and we are awaiting the Court's order on final approval.

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Other

We are involved in a number of other judicial and administrative proceedings that are incidental to our business. Although adverse decisions (or settlements) may occur in one or more of the cases, it is not possible to estimate the possible loss or losses from each of these cases. The final resolution of these lawsuits, individually or in the aggregate, is not expected to have a material adverse effect on our business, results of operations, financial condition or cash flows.

Note 8. Segment Information

On January 29, 2016, the Company completed the sale of its information management business. Financial results of the Company's information management business are included in income from discontinued operations for the three and nine months ended January 1, 2016 and January 2, 2015. See Note 3, Discontinued Operations for additional information. Accordingly, the following segment information reflects the Company's current segment reporting structure, and segment results for all reported periods have been adjusted to conform to the current segment structure.

The ~~three~~Company now operates in the following two reporting segments, which are the same as our operating ~~segments, are as follows:~~segments:

Consumer Security: Our Consumer Security segment focuses on making it simple for customers to be productive and protected at home and at work. Our Norton-branded services provide multi-layer security and identity protection on major desktop and mobile operating systems, to defend against increasingly complex online threats to individuals, families, and small businesses.

Enterprise Security: Our Enterprise Security segment protects organizations so they can securely conduct business while leveraging new platforms and data. Our Enterprise Security segment includes our threat protection products, information protection products, cyber security services, and website security, previously named trust services.

~~Information Management:~~ Our Information Management segment focuses on backup and recovery, archiving and eDiscovery, storage and high availability solutions, helping to ensure that our customers’ IT infrastructure and mission-critical applications are protected, managed and available. For additional information about the planned divestiture14

Table of ~~our information management business see Note 3.~~Contents

There were no intersegment sales for the periods presented. The following table summarizes the operating results of our reporting segments:


	Three Months Ended				Six Months Ended				Three Months Ended				Nine Months Ended
	October 2, 2015		October 3, 2014		October 2, 2015		October 3, 2014		January 1, 2016		January 2, 2015		January 1, 2016		January 2, 2015
	(Dollars in millions)								(Dollars in millions)
Total Segments
Net revenue	$	1,498	$	1,617	$	2,997	$	3,352
Net revenues									$	909	$	970	$	2,727	$	3,057
Operating income	421		464		831		891		254		330		812		1,016
Consumer Security
Net revenue	$	420	$	485	$	850	$	1,018
Net revenues									$	414	$	461	$	1,264	$	1,479
Operating income	232		257		477		525		230		245		707		770
Enterprise Security
Net revenue	$	485	$	511	$	967	$	1,063
Net revenues									$	495	$	509	$	1,463	$	1,578
Operating income	50		85		80		155		24		85		105		246
Information Management
Net revenue	$	593	$	621	$	1,180	$	1,271
Operating income	139		122		274		211

Operating segments are based upon the nature of ~~the~~our business and how ~~the~~our business is managed. Our Chief Operating Decision ~~Maker, which is~~Makers, comprised of our Chief Executive Officer and Chief Financial Officer, ~~uses this~~use operating segment financial information to evaluate the Company's performance ~~of,~~ and to assign ~~resources to, each~~resources.

A significant portion of the segments' operating expenses and cost of revenues, to a lesser extent, arise from shared services and infrastructure that we have historically provided to the segments in order to realize economies of scale and to efficiently use resources. These expenses (collectively "corporate charges") include legal, accounting, real estate, information technology services, treasury, human resources and other corporate infrastructure expenses. Charges were allocated to the segments, and the allocations were determined on a basis that we consider to be a reasonable reflection of the utilization of services provided to or benefits received by the segments. WeCorporate charges previously allocated to our information management business, but not classified within discontinued operations, were not reallocated to our other segments. At the beginning of the third quarter of fiscal 2016, as Veritas became operationally separate, operating costs related to Veritas were attributed directly to Veritas which reduced our unallocated corporate charges to zero. These charges are presented below as a component of the reconciliation between the total segment operating income and Symantec's income from continuing operations and are classified as unallocated corporate charges. In addition, we do not allocate ~~to the operating segments certain operating expenses which we manage separately at the corporate level. These unallocated costs consist of~~ stock-based compensation expense, amortization of intangible assets and restructuring, separation, and transition charges.

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The following table provides a reconciliation of the Company's total ~~of the~~ reportable segments’ operating income from continuing operations to ~~the~~its consolidated operating income:


	Three Months Ended				Six Months Ended				Three Months Ended				Nine Months Ended
	October 2, 2015		October 3, 2014		October 2, 2015		October 3, 2014		January 1, 2016		January 2, 2015		January 1, 2016		January 2, 2015
	(Dollars in millions)								(Dollars in millions)
Total segment operating income	$	421	$	464	$	831	$	891	$	254	$	330	$	812	$	1,016
Reconciling items:
Unallocated corporate charges									—		182		186		535
Stock-based compensation	80		46		133		89		38		34		118		94
Amortization of intangibles	27		40		59		82		20		29		63		92
Restructuring. separation, and transition	111		30		235		50
Total consolidated operating income	$	203	$	348	$	404	$	670
Restructuring, separation and transition									50		51		116		92
Total consolidated operating income from continuing operations									$	146	$	34	$	329	$	203

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Note 9. Stockholders' Equity

Dividends

The following table summarizes dividends declared and paid for the periods presented:


	Three Months Ended				Six Months Ended				Three Months Ended				Nine Months Ended
	October 2, 2015		October 3, 2014		October 2, 2015		October 3, 2014		January 1, 2016		January 2, 2015		January 1, 2016		January 2, 2015
	(Dollars in millions, except per share data)								(Dollars in millions, except per share data)
Dividends declared and paid	$	102	$	104	$	205	$	207	$	98	$	104	$	303	$	311
Cash dividends declared per common share	$	0.15	$	0.15	$	0.30	$	0.30	$	0.15	$	0.15	$	0.45	$	0.45

~~Each~~Quarterly dividends in the third quarter of fiscal 2016 were recorded as a reduction to retained earnings with any excess applied to additional paid-in capital. When in a retained deficit position, quarterly ~~dividend was~~dividends were recorded as a reduction to additional paid-in capital. Our restricted stock and performance-based stock units have dividend equivalent rights entitling holders to dividend equivalents to be paid in the form of cash upon vesting for each share of the underlying units.

On ~~November 5, 2015,~~February 4, 2016, we declared a cash dividend of $0.15 per share of common stock to be paid on ~~December~~March 16, ~~2015~~2016, to all stockholders of record as of the close of business on ~~November 23, 2015.~~February 22, 2016. All shares of common stock issued and outstanding, and unvested restricted stock and performance-based stock, as of the record date will be entitled to the dividend and dividend equivalents, respectively. Any future dividends and dividend equivalents will be subject to the approval of our Board of Directors.

Stock repurchases

~~The following table summarizes our stock repurchases for the periods presented:~~

Three Months Ended
October 2, 2015

Six Months Ended
October 2, 2015
(In millions, except per share data)
Total number of shares repurchased 7.6
11.3
Dollar amount of shares repurchased $ 160
$ 250
Average price paid per share $ 21.13
$ 22.20
Remaining authorization at end of period $ 2,408
$ 2,408

Through our stock repurchase programs we have repurchased shares on a quarterly basis since the fourth quarter of fiscal 2004. Under the programs, shares are repurchased on open market and through an accelerated stock repurchase ("ASR") transactions. During the second quarter of fiscal 2016, our Board of Directors authorized a new $1.5 billion stock repurchase program which commenced ~~immediately~~immediately. This additional amount authorized, in conjunction with amounts previously authorized under our prior program, resulted in $1.8 billion remaining authorized for future repurchases as of January 1, 2016, and does not have an expiration date. ~~This is in addition~~

Repurchases on open market transactions

The following table summarizes our stock repurchases on open market transactions for the periods presented and excludes the impact of shares purchased under our accelerated stock repurchase agreement (except for the remaining authorization amount):



	Three Months Ended January 1, 2016		Nine Months Ended January 1, 2016
	(In millions, except per share data)
Total number of shares repurchased	5.7		17.0
Dollar amount of shares repurchased	$	118	$	368
Average price paid per share	$	20.68	$	21.69
Remaining authorization at end of period	$	1,790	$	1,790

Accelerated Stock Repurchase Agreement

In November 2015, we entered into an ASR agreement with a financial institution to repurchase an aggregate of $500 million of our common stock. During the third quarter of fiscal 2016, we made an upfront payment of $500 million to the ~~remaining amount authorized for future repurchase~~financial institution pursuant to the ASR agreement, and received and retired an initial delivery of 19.9 million shares of our common stock. On January 15, 2016, our fourth quarter of fiscal 2016, the ASR was completed, which, per the terms of the agreement, resulted in our receiving an additional 5.0 million shares of our common stock. The total shares received and retired under the terms of the ASR were 24.9 million, with an average price paid per share of $20.08. The $500 million upfront payment is presented under the caption repurchases of common stock in our ~~previous program.~~Condensed Consolidated Statements of Cash Flows.

1516

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Changes in accumulated other comprehensive income by component

Components of accumulated other comprehensive income, on a net of tax basis, were as follows:


	Foreign Currency Translation Adjustments			Unrealized Gain On Available-For-Sale Securities		Total			Foreign Currency Translation Adjustments			Unrealized Gain On Available-For-Sale Securities		Total
	(Dollars in millions)								(Dollars in millions)
Balance as of April 3, 2015	$	101		$	3	$	104		$	101		$	3	$	104
Other comprehensive income before reclassifications	(22		)	5		(17		)	(33		)	3		(30		)
Loss reclassified from accumulated other comprehensive income	1			—		1			1			—		1
Balance as of October 2, 2015	$	80		$	8	$	88
Balance as of January 1, 2016									$	69		$	6	$	75

Note 10. Stock-Based Compensation

Stock-based compensation expense

The following table sets forth the stock-based compensation expense recognized in our Condensed Consolidated Statements of ~~Income:~~Operations:


	Three Months Ended						Six Months Ended						Three Months Ended						Nine Months Ended
	October 2, 2015			October 3, 2014			October 2, 2015			October 3, 2014			January 1, 2016			January 2, 2015			January 1, 2016			January 2, 2015
	(Dollars in millions)												(Dollars in millions)
Cost of revenue	$	8		$	6		$	13		$	12
Cost of revenues													$	3		$	4		$	7		$	12
Sales and marketing	29			18			48			35			12			11			39			34
Research and development	30			15			49			28			14			11			41			26
General and administrative	13			7			23			14			9			8			31			22
Total stock-based compensation expense	80			46			133			89			38			34			118			94
Tax benefit associated with stock-based compensation expense	(24		)	(14		)	(39		)	(26		)	(14		)	(9		)	(37		)	(27		)
Net stock-based compensation expense from continuing operations													24			25			81			67
Net stock-based compensation expense from discontinued operations													12			12			49			34
Net stock-based compensation expense	$	56		$	32		$	94		$	63		$	36		$	37		$	130		$	101

Restricted stock units

The following table summarizes additional information related to our stock-based compensation from restricted stock units, which are our primary equity awards:


	Six Months Ended				Nine Months Ended
	October 2, 2015		October 3, 2014		January 1, 2016		January 2, 2015
	(In millions, except per grant data)				(In millions, except per grant data)
Weighted-average fair value per grant	$	23.53	$	21.48	$	23.32	$	22.55
Awards granted	12.8		12.5		13.7		17.3
Total fair value of awards vested	$	140	$	87	$	191	$	98
Total unrecognized compensation expense	$	462	$	367	$	389	$	406
Weighted-average remaining vesting period	2.3 years		2.9 years		2.1 years		2.6 years

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Note 11. Income Taxes

The following table summarizes our effective tax rate for income from continuing operations for the periods presented:

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 October 2, 2015 October 3, 2014
Effective tax rate 17 % 27 % 25 % 25 %



	Three Months Ended						Nine Months Ended
	January 1, 2016			January 2, 2015			January 1, 2016			January 2, 2015
	(Dollars in millions)
Income before income taxes	$	129		$	19		$	276		$	159
Provision for income taxes	$	15		$	44		$	84		$	105
Effective tax rate	12		%	232		%	30		%	66		%

Our effective tax rate for income from continuing operations for the three and nine months ended January 1, 2016 differs from the federal statutory income tax rate primarily due to the benefits of lower-taxed international earnings, ~~and~~ domestic manufacturing incentives and the R&D credit, partially offset by state income taxes. Our effective tax rate for income from continuing operations for the three and nine months ended January 2, 2015 differs from the federal statutory income tax rate primarily due to the impact of unallocated corporate charges triggering foreign losses benefited by lower international tax rates as well as an overall reduction in pre-tax income.

For the three and nine months ended January 1, 2016, we recorded an income tax expense on discontinued operations of $53 million and $73 million, respectively. For the three and nine months ended January 2, 2015, we recorded an income tax expense on discontinued operations of $46 million and $143 million, respectively. See Note 3, Discontinued Operations, for further details regarding the discontinued operations.

The tax provision for the nine months ended January 1, 2016 was also reduced by $8 million in tax benefits related to certain foreign operations.

~~Table~~For the three and nine months ended January 2, 2015, the tax provision was reduced by tax benefits primarily resulting from settlements with certain taxing authorities and lapses of ~~Contents~~statutes of limitations of $2 million and $12 million, respectively.

On July 27, 2015, in Altera Corp. v. Commissioner, the U.S. Tax Court issued an opinion related to the treatment of stock-based compensation expense in an intercompany cost-sharing agreement. A final decision has yet to be issued by the Tax Court. At this time, the U.S. Department of the Treasury has not withdrawn the requirement to include stock-based compensation from its regulations. We evaluated the opinion and determined the net impact to our consolidated financial statements was not material. We will continue to monitor developments related to the case and the potential impact on our consolidated financial statements.

The tax provision for the three and six months ended October 2, 2015 was also reduced by $8 million in tax benefits related to certain foreign operations. In addition, as a result of having entered into a definitive agreement in the second quarter of fiscal 2016 to sell our information management business, certain transaction costs previously treated as non-deductible are now treated as deductible. The provision for the three months ended October 2, 2015, was accordingly reduced by $10 million related to certain transaction costs in fiscal 2015. For additional information about the planned divestiture of our information management business see Note 3.

For the three and six months ended October 3, 2014, the tax provision was reduced by tax benefits primarily resulting from settlements with certain taxing authorities and lapses of statutes of limitations of $2 million and $16 million, respectively.

We are a U.S.-based multinational company subject to tax in multiple U.S. and international tax jurisdictions. A substantial portion of our international earnings were generated from subsidiaries organized in Ireland and Singapore. Our results of operations would be adversely affected to the extent that our geographical mix of income becomes more weighted toward jurisdictions with higher tax rates and would be favorably affected to the extent the relative geographic mix shifts to lower tax jurisdictions. Any change in our mix of earnings is dependent upon many factors and is therefore difficult to predict.

The timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. Although potential resolution of uncertain tax positions involve multiple tax periods and jurisdictions, it is reasonably possible that the gross unrecognized tax benefits related to these audits could decrease (whether by payment, release, or a combination of both) in the next 12 months by ~~$27~~$21 million, which could reduce our income tax provision and therefore benefit the resulting effective tax rate.

We continue to monitor the progress of ongoing income tax controversies and the impact, if any, of the expected expiration of the statute of limitations in various taxing jurisdictions.

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Note 12. Earnings Per Share

The components of earnings per share are as follows:



	Three Months Ended					Nine Months Ended
	January 1, 2016		January 2, 2015			January 1, 2016		January 2, 2015
	(In millions, except per share data)
Income (loss) from continuing operations	$	114	$	(25	)	$	192	$	54
Income from discontinued operations, net of tax	56		247			251		648
Net income	$	170	$	222		$	443	$	702
Income (loss) per share — basic:
Continuing operations	$	0.17	$	(0.04	)	$	0.28	$	0.08
Discontinued operations	$	0.08	$	0.36		$	0.37	$	0.94
Net income per share	$	0.26	$	0.32		$	0.65	$	1.02
Income (loss) per share — diluted:
Continuing operations	$	0.17	$	(0.04	)	$	0.28	$	0.08
Discontinued operations	$	0.08	$	0.36		$	0.37	$	0.93
Net income per share	$	0.25	$	0.32		$	0.65	$	1.01

Weighted-average shares outstanding — basic	665		689			677		690
Dilutive potential shares from stock-based compensation	6		—			6		7
Weighted-average shares outstanding — diluted	671		689			683		697
Anti-dilutive potential shares	6		32			6		1

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 October 2, 2015 October 3, 2014
(In millions, except per share data)
Net income $ 156
$ 244
$ 273
$ 480
Net income per share — basic $ 0.23
$ 0.35
$ 0.40
$ 0.69
Net income per share — diluted $ 0.23
$ 0.35
$ 0.40
$ 0.69
Weighted-average shares outstanding — basic 682
690
682
691
Dilutive potential shares from stock-based compensation 5
6
7
6
Weighted-average shares outstanding — diluted 687
696
689
697
Anti-dilutive effect of stock-based compensation 11
1
6
2
Note: Net income (loss) per share amounts may not add due to rounding.

Note 13.Subsequent Events

Divestiture of our information management business

In January 2016, the Company and Carlyle amended the terms of the definitive agreement for Carlyle's acquisition of the information management business, Veritas. Based on the amended terms of the definitive agreement, the Company received net consideration of $6.6 billion in cash and 40 million B common shares of Veritas and Veritas assumed certain liabilities in connection with the acquisition. The transaction closed on January 29, 2016. The results of Veritas are presented as discontinued operations in our Condensed Consolidated Statements of Operations and thus have been excluded from continuing operations and segment results for all reported periods. Furthermore, the related assets and liabilities have been classified as held for sale on our Condensed Consolidated Balance Sheets. The gain on sale will be recorded in the fourth quarter of 2016, to the extent that the net proceeds from the final sale amount exceed the book carrying value of the assets sold. See Note 3, Discontinued Operations, for additional information on the presentation of discontinued operations.

Capital return program

On January 29, 2016, our Board of Directors announced a $2.0 billion capital return program.

Subsequently, on February 4, 2016, Symantec and Silver Lake announced that Silver Lake is purchasing $500 million aggregate principal amount of 2.5 percent convertible senior notes due 2021 with an initial conversion price of $21.00 per share. The notes will be redeemable at Symantec’s option beginning in 2020 if its common stock trades at 150% of the conversion price or more for at least 20 trading days in a period of 30 consecutive trading days, and the holder will be entitled to require that Symantec repurchase the notes beginning in 2020, in each case at a price of 100% of the principal amount plus accrued interest. Symantec expects to complete the sale of the notes on or before March 4, 2016. In connection with Silver Lake's investment, the Symantec Board authorized a $1 billion increase to its capital return program, bringing the total authorization amount to approximately $5 billion. The Company expects a total of $2.7 billion will be returned to shareholders in the form of a special dividend of $4.00 per share, and $2.3 billion will be returned through ASR transactions.

In connection with the approximate $5 billion capital return program, the Board has also determined to reduce the normal quarterly dividend to $0.075 per share of common stock in fiscal 2017.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-looking statements and factors that may affect future results

The discussion below contains forward-looking statements, which are subject to safe harbors under the Securities Act of 1933, as amended (the “Securities Act”) and the Exchange Act of 1934, as amended (the “Exchange Act”). Forward-looking statements include references to our ability to utilize our deferred tax assets, as well as statements including words such as “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” and similar expressions. In addition, ~~statements that refer to our plans to sell the assets of our information management business to Carlyle, timing of reporting discontinued operations,~~ projections of our future financial performance, anticipated growth and trends in our businesses and in our industries, the anticipated impacts of acquisitions, our intent to pay quarterly cash dividends in the future, the actions we intend to take as part of our new strategy, the expected impact of our new strategy and other characterizations of future events or circumstances are forward-looking statements. These statements are only predictions, based on our current expectations about future events and may not prove to be accurate. We do not undertake any obligation to update these forward-looking statements to reflect events occurring or circumstances arising after the date of this report. These forward-looking statements involve risks and uncertainties, and our actual results, performance, or achievements could differ materially from those expressed or implied by the forward-looking statements on the basis of several factors, including those that we discuss in Risk Factors, set forth in Part I, Item 1A, of our annual report on Form 10-K for the fiscal year ended April 3, 2015. We encourage you to read that section carefully.

OVERVIEW

Our business

Symantec Corporation is a global leader in security, backup and availability solutions. Our market leading products and services protect people and information in any environment – from the mobile device in your pocket, to the enterprise data center, to cloud-based systems. Founded in April 1982, Symantec operates one of the largest global threat-intelligence networks. The Company has more than 19,000 employees in more than 40 countries.

~~Fiscal calendar~~

security. We ~~have a 52/53-week fiscal year ending~~operate our business on the Friday closest to March 31. The three and six months ended October 2, 2015 consisted of 13 and 26 weeks, respectively. The three and six months ended and October 3, 2014 consisted of 13 and 27 weeks, respectively.

~~Strategy~~

~~In our security business, we operate~~ a global civilian cyber intelligence threat network and track a vast number of threats across the Internet from hundreds of millions of mobile devices, endpoints, and servers across the globe. We believe one of our competitive advantages is our database of threat indicators which allows us to reduce the number of false positives and provide faster and better protection for customers through our products. We are leveraging our capabilities in threat protection and data loss prevention and extending them into our core security offerings. We are also pioneering new solutions in growing markets like cloud, advanced threat protection, information protection and cyber security services.

Fiscal calendar

We have a 52/53-week fiscal year ending on the Friday closest to March 31. The three and nine months ended January 1, 2016 consisted of 13 and 39 weeks, respectively. The three and nine months ended January 2, 2015, consisted of 13 and 40 weeks, respectively.

Strategy

Our security strategy is to deliver a unified security analytics platform that provides big data analytics, utilizes our vast telemetry, provides visibility into real-time global threats, and powers Symantec and third-party security analytics applications; leverage this analytics platform to provide best-in-class consumer and enterprise security products; and offer cyber security services that provide a full-suite of services from monitoring to incident response to threat intelligence, all supported by over 500 cyber security experts and nine global security response centers.

In our information management business, with a global installed customer base, we have a comprehensive portfolio that spans backup and recovery, storage management and archiving. Our information availability offerings help customers keep their data and systems available where they need them, when they need them, and irrespective of their location. Our information insight solutions help customers know what data they have and leverage that knowledge to help manage such data better and inform strategic decisions.

Our information management product strategy is to expand our best-in-class foundational portfolio across backup, storage management, business continuity, archiving and eDiscovery through software, integrated appliances and the cloud; deliver next-generation availability solutions through a coordinated orchestration architecture focused on managing and moving mission-critical data in a hybrid cloud world; and enable next-generation insight solutions that provide visibility, action, and automated control across an organization’s information landscape through an intelligent information fabric that integrates our portfolio and third-party ecosystems.

~~Table of Contents~~

InDuring fiscal 2016, we ~~remain focused~~executed on our five priorities: running our businesses with a portfolio approach by managing certain businesses for operating margin; prioritizing investments for growth; further reducing costs and improving efficiencies; attracting top talent to our executive team; and continuing to return significant cash to shareholders. ~~We are optimizing some~~

After closing the divestiture of ~~our businesses by methodically evaluating every product line to balance our profitability targets against our objectives. In order to prioritize investments for growth,~~Veritas, we are ~~realigning~~now a more focused company and the world leader in cybersecurity and have updated our ~~research~~priorities to include: delivering upon our Unified Security strategy, building our enterprise security pipeline and ~~development budgets to apply the best resources to the most promising market opportunities. To further reduce costs~~go-to-market capabilities, improving our cost structure, and improve efficiencies, we are consolidating our global footprint, data centers and product support capabilities as well as streamlining the way we run our businesses with initiatives to increase research and development efficiencies and sales productivity. We are focused on continuing to attract talented business and technology leaders to the company. We remain committed to returning significant cash to shareholders in the formefficiently allocating capital.

Table of ~~dividends and share buybacks.~~Contents

~~Planned divestiture~~Divestiture of our information management business

In the second quarter of fiscal 2016, we entered into a definitive agreement to sell the assets of our information management business, Veritas, to Carlyle. In January 2016, we and Carlyle ~~for cash consideration of approximately $8.0 billion and~~amended the assumption of certain liabilities, subject to specified adjustments. The divestiture of our information management business will help us accelerate our unified security strategy, provide a stronger financial foundation for strategic investments, and return additional cash to our shareholders through a combination of share repurchases and dividends. The sale is expected to close by the endterms of the ~~third quarter of fiscal 2016, subject to regulatory approvals and certain closing conditions, including the operational separation, in all material respects,~~definitive agreement for Carlyle's acquisition of the information management ~~business.~~

~~We expect that effective beginning~~business, Veritas. Based on the amended terms of the definitive agreement, we received net consideration of $6.6 billion in cash and 40 million B common shares of Veritas and Veritas assumed certain liabilities in connection with the ~~third quarter of fiscal 2016, the financial~~acquisition. The transaction closed on January 29, 2016. The results of ~~our information management business will be~~Veritas are presented as discontinued operations ~~on the~~in our Condensed Consolidated ~~Financial~~ Statements ~~as we expect then to meet~~of Operations and thus have been excluded from continuing operations and segment results for all reported periods. Furthermore, the ~~criteria for the information management business to be~~related assets and liabilities have been classified as held for ~~sale. Subsequently, we will~~sale on our Condensed Consolidated Balance Sheets. Accordingly, the following discussion reflects our current segment reporting structure, and segment results for all reported periods have ~~two remaining reporting segments, Consumer Security~~been adjusted to conform to the current segment structure. In addition, all information in the Results of Operations and ~~Enterprise Security.~~Liquidity and Capital Resources sections relates to our continuing operations unless stated otherwise.

For additional information ~~about~~on the ~~planned divestiture,~~sale of Veritas and on our discontinued operations, see Note 3, Discontinued Operations, and Note 13, Subsequent Events, of the Notes to Condensed Consolidated Financial Statements in this quarterly report.

Our operating segments

Our current operating segments are significant strategic business units that offer different products and services distinguished by customer needs. ~~The three~~We now operate in the following two reporting segments, which are the same as our operating ~~segments, are:~~segments:

~~Information Management~~: Our Information Management segment focuses on backup and recovery, archiving and eDiscovery, storage and high availability solutions, helping to ensure that our customers’ IT infrastructure and mission-critical applications are protected, managed and available. For ~~additional information about the planned divestiture~~further description of our ~~information management business~~operating segments see Note 38, Segment Information, of the Notes to Condensed Consolidated Financial Statements in this quarterly report.

~~For further description of our operating segments see~~ ~~Note 8~~ ~~of the Notes to Condensed Consolidated Financial Statements in this quarterly report.~~

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Financial results and trends

The following table provides an overview of key financial metrics for the periods indicated below:

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 October 2, 2015 October 3, 2014
(Dollars in millions)
Consolidated Income Statement Data:
  Total net revenue $ 1,498
$ 1,617
$ 2,997
$ 3,352
  Gross profit 1,234
1,339
2,479
2,765
  Operating income 203
348
404
670
Operating margin percentage 14 % 22 % 13 % 20 %
Consolidated Cash Flow and Balance Sheet Data:
  Cash flow from operations $ 434
$ 466
  Deferred revenue 3,271
3,417



	Three Months Ended						Nine Months Ended
	January 1, 2016			January 2, 2015			January 1, 2016			January 2, 2015
	(Dollars in millions)
Consolidated Statements of Operations Data:
Net revenues	$	909		$	970		$	2,727		$	3,057
Gross profit	759			793			2,259			2,506
Operating income	146			34			329			203
Operating margin percentage	16		%	4		%	12		%	7		%
Consolidated Cash Flow Data:
Cash flow from continuing operations							$	316		$	(50	)

The ~~six~~nine months ended ~~October 3, 2014,~~January 1, 2016, consisted of 2739 weeks and the ~~six~~nine months ended ~~October~~January 2, 2015, consisted of 2640 weeks.

~~Total net revenue~~Net revenues for the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, decreased ~~$119~~$61 million and ~~$355~~$330 million, respectively, compared to the corresponding prior year periods. The ~~lower net revenue was~~decreases were primarily due to ~~the general strengthening of the U.S. dollar against foreign currencies~~unfavorable currency fluctuations and declines in our consumer security products driven by the continued implementation of our channel strategy to exit unprofitable retail arrangements, coupled with the ongoing impact of changes to our renewal practices. These factors were partially offset by strong performance from NetBackup Appliance. Totalrevenue. In addition, net ~~revenue~~revenues for the ~~six~~nine months ended ~~October 2, 2015, also~~January 1, 2016, decreased due to the impact of ~~the~~an additional week in the ~~six~~nine months ended ~~October 3, 2014.~~January 2, 2015.

~~Gross~~Our gross margin ~~remained relatively consistent at 82% and~~of 83% for both the three and ~~six~~nine months ended ~~October 2, 2015, respectively,~~January 1, 2016, remained relatively stable compared to ~~83% and~~ 82% for ~~the three and six months ended October 3, 2014, respectively, as the~~both corresponding previous year periods. The cost of ~~revenue decreases were generally proportional~~revenues decreased proportionally compared to the ~~decreases~~decrease in ~~total~~ net ~~revenue.~~revenues.

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Operating income for the three and ~~six~~nine months ended ~~October 2, 2015, decreased $145~~January 1, 2016, increased $112 million and ~~$266~~$126 million, respectively, compared to the corresponding prior year ~~periods~~periods. The increases in operating income were due primarily ~~due~~ to ~~lower net revenue and increased restructuring, separation, and transition costs related~~a decrease in corporate charges previously allocated to ~~our fiscal 2015 restructuring plan initiated in connection with the separation of~~ our information management ~~business.~~business but not classified within discontinued operations. These ~~factors~~corporate charges were included in cost of revenues and expenses from continuing operations and include legal, accounting, real estate, information technology services, treasury, human resources and other corporate infrastructure expenses. See Note 8, Segment Information, of the Notes to Condensed Consolidated Financial Statements in this quarterly report for more details. The reduction of unallocated corporate charges increased operating income by $182 million and $349 million in the three and nine months ended January 1, 2016, respectively. The increases were partially offset by ~~favorable foreign currency effects on our total operating expense~~decreased revenue of ~~approximately $40~~$61 million and ~~$80~~$330 million for the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, respectively. ~~In addition,~~We anticipate that our quarterly operating ~~expenses for~~income will continue to benefit from a reduction of unallocated corporate costs as compared to the ~~six months ended October 2, 2015, decreased due to our cost savings initiatives and~~year ago period until the ~~impact~~third quarter of ~~the additional week in the six months ended October 3, 2014.~~fiscal 2017. We expect our operating margins to fluctuate in future periods as a result of a number of factors, including our operating results and the timing and amount of expenses incurred.

Net cash provided by continuing operating activities was ~~$434~~$316 million for the ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, which resulted from ~~net~~ income from continuing operations of ~~$273~~$192 million adjusted for non-cash items, including depreciation and amortization charges of ~~$204~~$227 million and stock-based compensation expense of ~~$133~~$118 million, as well as net changes in ~~accounts receivable and accounts payable~~deferred income taxes resulting in inflows of ~~$255 million and $50 million, respectively.~~$63 million. These amounts were partially offset by decreases in deferred revenue of ~~$397~~$175 million and ~~accrued compensation and benefits~~income taxes payable of ~~$107~~$94 million.

~~Total deferred revenue decreased $146 million from~~ ~~$3,417 million~~ ~~at October 3, 2014, to $3,271 million at October 2, 2015, primarily due to unfavorable foreign currency fluctuations.~~

Critical accounting policies and estimates

There have been no material changes in the matters for which we make critical accounting estimates in the preparation of our Condensed Consolidated Financial Statements during the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, as compared to those disclosed in Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the fiscal year ended April 3, 2015.

Recently issued authoritative guidance

See Note 1, Description of Business and Significant Accounting Policies, of the Notes to Condensed Consolidated Financial Statements in this ~~quarterly report~~Quarterly Report on Form 10-Q for recently issued authoritative guidance, including the ~~respective~~ expected dates of adoption and the effects on our results of operations and financial condition.

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RESULTS OF OPERATIONS

The following table sets forth certain Condensed Consolidated Statements of ~~Income~~Operations data as a percentage of net ~~revenue~~revenues for the periods indicated:


	Three Months Ended				Six Months Ended				Three Months Ended				Nine Months Ended
	October 2, 2015		October 3, 2014		October 2, 2015		October 3, 2014		January 1, 2016		January 2, 2015		January 1, 2016		January 2, 2015
Net revenue:
Content, subscription, and maintenance	89	%	89	%	90	%	90	%
License	11	%	11	%	10	%	10	%
Total net revenue	100	%	100	%	100	%	100	%
Cost of revenue:
Content, subscription, and maintenance	15	%	15	%	15	%	15	%
License	2	%	2	%	2	%	2	%
Amortization of intangible assets	1	%	1	%	1	%	1	%
Total cost of revenue	18	%	17	%	17	%	18	%
Net revenues									100	%	100	%	100	%	100	%
Cost of revenues									17	%	18	%	17	%	18	%
Gross profit	82	%	83	%	83	%	82	%	83	%	82	%	83	%	82	%
Operating expenses:
Sales and marketing	34	%	35	%	35	%	36	%	34	%	42	%	36	%	41	%
Research and development	20	%	17	%	19	%	17	%	19	%	20	%	21	%	20	%
General and administrative	6	%	6	%	6	%	6	%	7	%	9	%	8	%	9	%
Amortization of intangible assets	1	%	2	%	1	%	2	%	1	%	2	%	2	%	2	%
Restructuring, separation, and transition	7	%	2	%	8	%	1	%	6	%	5	%	4	%	3	%
Total operating expenses	69	%	61	%	69	%	63	%	67	%	78	%	71	%	75	%
Operating income	14	%	22	%	13	%	20	%	16	%	4	%	12	%	7	%
Non-operating expense, net	1	%	1	%	1	%	1	%	2	%	2	%	2	%	1	%

Note: The total percentages may not add due to rounding.

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~~Total net revenue~~Net revenues

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 % Change October 2, 2015 October 3, 2014 % Change
(Dollars in millions)
Content, subscription, and maintenance revenue $ 1,333
$ 1,445
(8) % $ 2,685
$ 3,019
(11) %
License revenue 165
172
(4) % 312
333
(6) %
Total $ 1,498
$ 1,617
(7) % $ 2,997
$ 3,352
(11) %



	Three Months Ended						Nine Months Ended
	January 1, 2016		January 2, 2015		% Change		January 1, 2016		January 2, 2015		% Change
	(Dollars in millions)
Net revenues	$	909	$	970	(6)	%	$	2,727	$	3,057	(11)	%

~~Content, subscription, and maintenance revenue~~Net revenues decreased ~~$112~~$61 million and ~~$334~~$330 million for the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, respectively, compared to the corresponding prior year periods. The decreases were primarily due to unfavorable currency fluctuations of approximately ~~$88~~$39 million and ~~$191~~$167 million, respectively, and declines in our consumer security ~~products~~revenue driven by the ~~continued implementation~~ongoing impact of ~~our channel strategy to exit unprofitable retail arrangements, as well as~~ changes to our renewal ~~practices.~~practices and a reduction in OEM arrangements. These ~~factors~~declines were partially offset by ~~revenue increases~~an increase in ~~NetBackup products. Content, subscription, and maintenance revenue~~Data Loss Prevention revenue. Net revenues for the ~~six~~nine months ended ~~October 2, 2015~~January 1, 2016, also decreased due to the impact of the additional week in the ~~six~~nine months ended ~~October 3, 2014.~~January 2, 2015.

~~License~~Net revenues and operating income by segment



	Three Months Ended								Nine Months Ended
	January 1, 2016			January 2, 2015			% Change		January 1, 2016			January 2, 2015			% Change
	(Dollars in millions)
Net revenues:
Consumer Security	$	414		$	461		(10)	%	$	1,264		$	1,479		(15)	%
Enterprise Security	495			509			(3)	%	1,463			1,578			(7)	%
Percentage of total net revenues:
Consumer Security	46		%	48		%			46		%	48		%
Enterprise Security	54		%	52		%			54		%	52		%
Operating income:
Consumer Security	$	230		$	245		(6)	%	$	707		$	770		(8)	%
Enterprise Security	24			85			(72)	%	105			246			(57)	%
Operating margin:
Consumer Security	56		%	53		%			56		%	52		%
Enterprise Security	5		%	17		%			7		%	16		%

Consumer Security revenue decreased $7$47 million and ~~$21~~$215 million ~~during~~for the three and ~~six~~nine months ended ~~October~~January 1, 2016, respectively, compared to the same periods last year. The decreases were partially due to unfavorable foreign currency fluctuations of approximately $18 million and $80 million, respectively, and the ongoing impact of changes to our renewal practices and a reduction in OEM arrangements. Consumer Security operating income decreased $15 million and $63 million for the three and nine months ended January 1, 2016, respectively, primarily due to the decreases in revenue, which were partially offset by reductions in cost of revenues and in sales and marketing and research and development expenses.

Enterprise Security revenue decreased $14 million and $115 million for the three and nine months ended January 1, 2016, respectively, compared to the same periods last year, primarily due to unfavorable foreign currency fluctuations of approximately $21 million and $87 million, respectively, which were partially offset by an increase in Data Loss Prevention revenue. Enterprise Security operating income decreased $61 million for the three months ended January 1, 2016, compared to the same period last year, primarily due to increased investments in research and development and sales and marketing, along with decreases in revenue. Enterprise Security operating income decreased $141 million for the nine months ended January 1, 2016, compared to the same period last year, primarily due to decreased revenue and increased investments in research and development.

In addition to the aforementioned factors, each segment's revenue also decreased for the nine months ended January 1, 2016, due to the impact of the additional week in the nine months ended January 2, ~~2015,~~2015.

Table of Contents

Net revenues by geographic region



	Three Months Ended								Nine Months Ended
	January 1, 2016			January 2, 2015			% Change		January 1, 2016			January 2, 2015			% Change
	(Dollars in millions)
Revenues by geographic region:
Americas (U.S., Canada and Latin America)	$	539		$	551		(2	)%	$	1,607		$	1,701		(6)	%
EMEA (Europe, Middle East and Africa)	224			259			(14	)%	677			835			(19)	%
APJ (Asia Pacific and Japan)	146			160			(9	)%	443			521			(15)	%
Total net revenues	$	909		$	970		(6	)%	$	2,727		$	3,057		(11)	%

U.S.	$	484		$	496		(2	)%	$	1,441		$	1,506		(4)	%
International	425			474			(10	)%	1,286			1,551			(17)	%
Total net revenues	$	909		$	970		(6	)%	$	2,727		$	3,057		(11	)%

Percentage of total net revenues:
Americas (U.S., Canada and Latin America)	59		%	57		%			59		%	56		%
EMEA (Europe, Middle East and Africa)	25		%	27		%			25		%	27		%
APJ (Asia Pacific and Japan)	16		%	16		%			16		%	17		%
U.S.	53		%	51		%			53		%	49		%
International	47		%	49		%			47		%	51		%

Fluctuations in the U.S. dollar compared to foreign currencies unfavorably impacted our international revenue by approximately $39 million and $167 million for the three and nine months ended January 1, 2016, respectively, compared to the same periods last year. The EMEA region revenue decreased for the three and nine months ended January 1, 2016, compared to the same periods last year, primarily due to unfavorable foreign currency fluctuations of approximately $28 million and $116 million, respectively. The APJ region revenue decreased for the three and nine months ended January 1, 2016, compared to the same periods last year, primarily due to unfavorable foreign currency fluctuations of approximately $10 million and ~~$23 million, respectively, partially offset by increases in license revenue from Data Loss Prevention.~~

~~Table of Contents~~

~~Net revenue and operating income by segment~~

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 % Change October 2, 2015 October 3, 2014 % Change
(Dollars in millions)
Total net revenue:
Consumer Security $ 420
$ 485
(13) % $ 850
$ 1,018
(17) %
Enterprise Security 485
511
(5) % 967
1,063
(9) %
Information Management 593
621
(5) % 1,180
1,271
(7) %
Percentage of total net revenue:
Consumer Security 28 % 30 % 28 % 30 %
Enterprise Security 32 % 32 % 32 % 32 %
Information Management 40 % 38 % 39 % 38 %
Operating income:
Consumer Security $ 232
$ 257
(10) % $ 477
$ 525
(9) %
Enterprise Security 50
85
(41) % 80
155
(48) %
Information Management 139
122
14 % 274
211
30 %
Operating margin:
Consumer Security 55 % 53 % 56 % 52 %
Enterprise Security 10 % 17 % 8 % 15 %
Information Management 23 % 20 % 23 % 17 %

Consumer Security revenue decreased $65 million and $168 million for the three and six months ended October 2, 2015, respectively, compared to the same periods last year. The revenue decreases were primarily due to unfavorable foreign currency fluctuations of approximately $28 million and $62 million, respectively, and the continued implementation of our channel strategy to exit unprofitable retail arrangements, coupled with the ongoing impact of changes to our renewal practices. Consumer Security operating income decreased $25 million and $48 million for the three and six months ended October 2, 2015, respectively, primarily due to the decreases in revenue, which were partially offset by reductions in cost of revenue and headcount related and marketing expenses.

Enterprise Security revenue decreased $26 million and $96 million for the three and six months ended October 2, 2015, respectively, compared to the same periods last year, primarily due to unfavorable foreign currency fluctuations of approximately $30 million and $66 million, respectively. Enterprise Security operating income decreased $35 million and $75 million for the three and six months ended October 2, 2015, respectively, compared to the same periods last year, primarily due to decreased revenue and increased investments in research and development to help bring new products to market. These factors were partially offset by reduced sales and marketing expense.

Information Management revenue decreased $28 million and $91 million for the three and six months ended October 2, 2015, respectively, compared to the same periods last year. The revenue decreases were primarily due to unfavorable foreign currency fluctuations of approximately $41 million and $86 million, respectively, as well as weakness in Information Availability and Backup Exec. These factors were partially offset by strong performance from NetBackup products. Information Management operating income increased $17 million and $63 million for the three and six months ended October 2, 2015, respectively, compared to the same periods last year, primarily driven by decreased sales and marketing and headcount related expenses, which were partially offset by the decreases in revenue.

In addition to the aforementioned factors, each segment's revenue also decreased for the six months ended October 2, 2015, due to the impact of the additional week in the six months ended October 2, 2014.

~~Table of Contents~~

~~Net revenue by geographic region~~

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 % Change October 2, 2015 October 3, 2014 % Change
(Dollars in millions)
Revenue by geographic region:
Americas (U.S., Canada and Latin America) $ 866
$ 884
(2 )% $ 1,721
$ 1,824
(6) %
EMEA (Europe, Middle East and Africa) 387
455
(15 )% 778
950
(18) %
APJ (Asia Pacific and Japan) 245
278
(12 )% 498
578
(14) %
Total net revenue $ 1,498
$ 1,617
(7 )% $ 2,997
$ 3,352
(11) %

U.S. $ 781
$ 770
1 % $ 1,548
$ 1,602
(3) %
International 717
847
(15 )% 1,449
1,750
(17) %
Total net revenue $ 1,498
$ 1,617
(7 )% $ 2,997
$ 3,352
(11 )%

Percentage of total net revenue:
Americas (U.S., Canada and Latin America) 58 % 55 % 57 % 54 %
EMEA (Europe, Middle East and Africa) 26 % 28 % 26 % 28 %
APJ (Asia Pacific and Japan) 16 % 17 % 17 % 17 %
U.S. 52 % 48 % 52 % 48 %
International 48 % 52 % 48 % 52 %

~~Note: The total percentages may not add due to rounding.~~

Fluctuations in the U.S. dollar compared to foreign currencies unfavorably impacted our international revenue by approximately $99 million and $214 million for the three and six months ended October 2, 2015, respectively, compared to the same periods last year. The EMEA region revenue decreased for the three and six months ended October 2, 2015, compared to the same periods last year, primarily due to unfavorable foreign currency fluctuations of approximately $67 million and $154 million, respectively. The APJ region revenue decreased for the three and six months ended October 2, 2015, compared to the same periods last year, primarily due to unfavorable foreign currency fluctuations of approximately $30 million and $57$50 million, respectively.

We expect that our international sales will continue to represent a significant portion of our revenue. As a result, we anticipate that foreign currency exchange rates compared to the U.S. dollar will continue to affect revenue. However, we are unable to predict the extent to which revenue in future periods will be impacted by changes in foreign currency exchange rates. If international sales become a greater portion of our total sales in the future, changes in foreign currency exchange rates may have a potentially greater impact on our revenue and operating results.

~~Table of Contents~~

Cost of ~~revenue~~revenues

Three Months Ended Six Months Ended
October 2, 2015 October 3, 2014 % Change October 2, 2015 October 3, 2014 % Change
(Dollars in millions)
Cost of content, subscription, and maintenance $ 225
$ 240
(6 )% $ 444
$ 509
(13) %
Cost of license 29
25
16 % 51
52
(2) %
Amortization of intangible assets 10
13
(23 )% 23
26
(12) %
Total $ 264
$ 278
(5 )% $ 518
$ 587
(12) %



	Three Months Ended						Nine Months Ended
	January 1, 2016		January 2, 2015		% Change		January 1, 2016		January 2, 2015		% Change
	(Dollars in millions)
Cost of revenues	$	150	$	177	(15	)%	$	468	$	551	(15)	%

Cost of ~~content, subscription, and maintenance~~revenues consists primarily of technical support costs, costs of billable services, and fees to original equipment manufacturers ("OEMs") under revenue-sharing agreements. Cost of license consists primarily of royalties paid to third parties under technology licensing agreements, appliance manufacturing costs, and other direct material costs. Cost of revenue from amortization of intangible assets is comprised of amortization from developed technologies and patents from acquired companies. Our ~~total~~ cost of ~~revenue~~revenues decreased ~~$14~~$27 million for the three months ended ~~October 2, 2015,~~January 1, 2016, compared to the same period last year, primarily due to a decrease in OEM royalty fees, favorable currency effects, and a decrease in technology support and content delivery expenses. Cost of revenues decreased $83 million for the nine months ended January 1, 2016, compared to the same period last year, primarily due to favorable currency effects, of approximately $15 million. Total cost of revenue decreased $69 million for the six months ended October 2, 2015, compared to the same period last year, primarily due to favorable currency effects of approximately $28 million, a decrease in OEM ~~and other~~ royalty fees, and ~~the impact~~a decrease in service related and content delivery expenses.

Table of ~~the additional week in the six months ended October 3, 2014.~~Contents

Operating expenses


	Three Months Ended						Six Months Ended						Three Months Ended						Nine Months Ended
	October 2, 2015		October 3, 2014		% Change		October 2, 2015		October 3, 2014		% Change		January 1, 2016		January 2, 2015		% Change		January 1, 2016		January 2, 2015		% Change
	(Dollars in millions)												(Dollars in millions)
Sales and marketing	$	516	$	565	(9	)%	$	1,037	$	1,209	(14)	%	$	308	$	403	(24	)%	$	984	$	1,265	(22)	%
Research and development	293		276		6	%	577		584		(1)	%	174		193		(10	)%	571		604		(5)	%
General and administrative	94		93		1	%	190		196		(3)	%	68		91		(25	)%	218		276		(21)	%
Amortization of intangible assets	17		27		(37	)%	36		56		(36)	%	13		21		(38	)%	41		66		(38)	%
Restructuring, separation, and transition	111		30		270	%	235		50		370	%	50		51		(2	)%	116		92		26	%
Total	$	1,031	$	991	4	%	$	2,075	$	2,095	(1)	%	$	613	$	759	(19	)%	$	1,930	$	2,303	(16)	%

The overall decreases in operating expenses for the three and nine months ended January 1, 2016, were primarily due to a decrease in corporate charges previously allocated to our information management business (“unallocated corporate charges”) in periods prior to the three months ended January 1, 2016. These corporate charges are included in expenses from continuing operations. Refer to Note 8, Segment Information, for more information about our unallocated corporate charges. The impacts of the unallocated corporate charges are discussed below.

Sales and marketing expense decreased ~~$49~~$95 million and ~~$172~~$281 million for the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, respectively, compared to the same periods last ~~year,~~year. The decreases were primarily due to ~~favorable foreign currency effects~~a reduction of ~~approximately $28~~unallocated corporate charges of $110 million and ~~$57~~$230 million ~~respectively,~~in the three and nine months ended January 1, 2016, respectively. In addition, sales and marketing expenses also declined for the nine months ended January 1, 2016, as a ~~decrease in~~result of lower advertising and promotion costs. Sales and marketing for the six months ended, was further reduced by lower salaries and wages due to reduced headcount, and the incremental expense from the extra week in the six months ended October 3, 2014.promotional spending.

Research and development expense ~~increased $17~~decreased $19 million and $33 million for the three and nine months ended ~~October 2, 2015,~~January 1, 2016, respectively, compared to the same ~~period~~periods last ~~year,~~year. The decreases were primarily due to ~~an increase~~a reduction of unallocated corporate charges of $30 million and $47 million in ~~stock-based compensation expense. Research~~the three and nine months ended January 1, 2016, respectively. The decreases were partially offset by increased investment in research and development for our enterprise security business.

General and administrative expense decreased $7$23 million and $58 million for the ~~six~~three and nine months ended ~~October 2, 2015,~~January 1, 2016, compared to the same ~~period~~periods last ~~year,~~year. The decreases were primarily due to ~~favorable foreign currency effects~~a reduction of ~~approximately $13~~unallocated corporate charges of $33 million and ~~the incremental expense from the extra week~~$63 million in the ~~six~~three and nine months ended ~~October 3, 2014, partially offset by an increase in stock-based compensation expense.~~January 1, 2016, respectively.

Amortization of intangible assets decreased ~~$10~~$8 million and ~~$20~~$25 million for the three and ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, respectively, compared to the same periods last year, primarily due to certain intangible assets becoming fully amortized during the year ended April 3, 2015.

Restructuring, separation, and transition costs include severance, facilities, separation, transition and other related costs. These charges increased ~~$81 million and $185~~$24 million for the ~~three and six~~nine months ended ~~October 2, 2015, respectively,~~January 1, 2016, compared to the same ~~periods~~period last ~~year,~~year. The increase was due primarily ~~due~~ to the timing of our fiscal 2015 restructuring plan, ~~that~~which was initiated during the second quarter of fiscal ~~2015~~2015. The plan was initiated in connection with ~~our plans to separate our business into two companies, and transition costs related to~~ the ~~implementation~~then proposed spin-off of ~~a new enterprise resource planning system for the~~our information management business. For further information on restructuring, separation, and transition, see Note 6, Restructuring, Separation, and Transition, of the Notes to Condensed Consolidated Financial Statements in this quarterly report.

~~Table of Contents~~

Non-operating expense, net


	Three Months Ended								Six Months Ended								Three Months Ended								Nine Months Ended
	October 2, 2015			October 3, 2014			% Change		October 2, 2015			October 3, 2014			% Change		January 1, 2016			January 2, 2015			% Change		January 1, 2016			January 2, 2015			% Change
	(Dollars in millions)																(Dollars in millions)
Interest income	$	3		$	3		—	%	$	6		$	6		—	%	$	1		$	3		(67	)%	$	6		$	9		(33	)%
Interest expense	(19		)	(19		)	—	%	(39		)	(40		)	(3)	%	(17		)	(19		)	(11	)%	(56		)	(59		)	(5	)%
Other income (expense), net	2			1			*		(9		)	2			*		(1		)	1			*		(3		)	6			*
Non-operating expense, net	$	(14	)	$	(15	)	(7	)%	$	(42	)	$	(32	)	31	%	$	(17	)	$	(15	)	13	%	$	(53	)	$	(44	)	20	%

* Percentage is not meaningful.

Non-operating expense, net, increased ~~$10~~$9 million for the ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, primarily due to ~~net foreign currency remeasurement losses.~~an increase in miscellaneous non-operating expenses.

Table of Contents

Provision for income taxes


	Three Months Ended								Six Months Ended								Three Months Ended								Nine Months Ended
	October 2, 2015			October 3, 2014			% Change		October 2, 2015			October 3, 2014			% Change		January 1, 2016			January 2, 2015			% Change		January 1, 2016			January 2, 2015			% Change
	(Dollars in millions)																(Dollars in millions)
Income before income taxes																	$	129		$	19				$	276		$	159
Provision for income taxes	$	33		$	89		(63)	%	$	89		$	158		(44)	%	$	15		$	44		(66)	%	$	84		$	105		(20)	%
Effective tax rate on earnings	17		%	27		%			25		%	25		%			12		%	232		%			30		%	66		%

The tax provision for the nine months ended January 1, 2016 was also reduced by $8 million in tax benefits related to certain foreign operations.

For the three and nine months ended January 2, 2015, the tax provision was reduced by tax benefits primarily resulting from settlements with certain taxing authorities and lapses of statutes of limitations of $2 million and $12 million, respectively.

We continue to monitor the progress of ongoing income tax controversies and the impact, if any, of the expected expiration of the statute of limitations in various taxing jurisdictions.

2526

Table of Contents

LIQUIDITY AND CAPITAL RESOURCES

~~Planned divestiture~~Divestiture of our information management business

In the second quarter of fiscal 2016, we entered into a definitive agreement to sell the assets of our information management business, Veritas, to ~~Carlyle for cash consideration~~Carlyle. The agreement was amended in January 2016 and closed on January 29, 2016, see Note 13, Subsequent Events, of ~~approximately $8.0 billion and~~ the ~~assumption of certain liabilities, subject~~Notes to ~~specified adjustments.~~Condensed Consolidated Financial Statements. We are in the process of evaluating the transaction and its impact on our Condensed Consolidated Financial Statements, including evaluating the resulting net gain and income tax expense that will be ~~recognized, based on all the terms of the agreement.~~recognized. The Company's U.S. and foreign income taxes and indirect taxes payable resulting from the transaction are estimated to ~~range from~~be $1.3 ~~billion to $1.7~~ billion.

Sources of cash

We have historically relied on cash flow from operations, borrowings under a credit facility, and issuances of debt and equity securities for our liquidity needs. As of ~~October 2, 2015,~~January 1, 2016, we had cash, cash equivalents and short-term investments from continuing operations of ~~$3.4~~$2.3 billion and an unused credit facility of $1.0 billion, resulting in a continuing operations liquidity position of approximately ~~$4.4~~$3.3 billion. As of ~~October 2, 2015, $2.4~~January 1, 2016, $1.2 billion in cash, cash equivalents, and short-term investments were held by our foreign subsidiaries. We have provided U.S. deferred taxes on a portion of our undistributed foreign earnings sufficient to address the incremental U.S. tax that would be due if we needed such portion of these funds to support our operations in the U.S. In connection with the closing of the Veritas transaction, Symantec received net consideration of $6.6 billion in cash.

Revolving Credit Facility. In fiscal 2011, we entered into a $1.0 billion senior unsecured revolving credit facility, which was amended in fiscal 2013. The amendment extended the term of the credit facility to June 7, 2017. Loans under the credit facility will bear interest, at our option, at a rate equal to either a) LIBOR plus a margin based on debt ratings, as defined in the credit facility agreement or b) the bank’s base rate plus a margin based on debt ratings, as defined in the credit facility agreement. Under the terms of this credit facility, we must comply with certain financial and non-financial covenants, including a covenant to maintain a specified ratio of debt to EBITDA (earnings before interest, taxes, depreciation and amortization). As of ~~October 2, 2015,~~January 1, 2016, we were in compliance with the required covenants, and no amounts were outstanding.

We believe that our existing cash and investment balances, our available revolving credit facility, our ability to issue new debt instruments, and cash generated from operations will be sufficient to meet our working capital and capital expenditure requirements, as well as to fund any cash dividends, principal and interest payments on debt, and repurchases of our stock, for at least the next 12 months and foreseeable future. We have a capital allocation strategy pursuant to which we expect to return over time approximately 50% of free cash flow to stockholders through a combination of dividends and share repurchases, while still enabling our company to invest in its future. Our strategy emphasizes organic growth through internal innovation and will be complemented by acquisitions that fit strategically and meet specific internal profitability hurdles.

Uses of cash

Our principal cash requirements include working capital, capital expenditures, payments of principal and interest on debt, and payments of taxes. Also, we may, from time to time, engage in the open market purchase of our notes prior to their maturity. Furthermore, our capital allocation strategy contemplates a quarterly cash dividend. In addition, we regularly evaluate our ability to repurchase stock, pay debts, and acquire other businesses.

Stock ~~Repurchases.~~Repurchases on Open Market Transactions. For ~~each of~~ the ~~six~~nine months ended ~~October 2, 2015, and October 3, 2014,~~January 1, 2016, we repurchased approximately 1117 million shares, or ~~$250~~$368 million, of our common stock. For the nine months ended January 2, 2015, we repurchased approximately 16 million shares, or $375 million, of our common stock. The timing and amount of common shares purchased under our authorized stock repurchase programs will depend on various factors, including our business plans, financial performance and market conditions. During the second quarter of fiscal 2016, our Board of Directors authorized a new $1.5 billion stock repurchase program which commenced immediately and does not have an expiration date. ~~This additional amount authorized, in conjunction with amounts previously authorized under our prior program, resulted in $2.4~~As of January 1, 2016, $1.8 billion was available for future repurchases, ~~as of October 2, 2015. As part of~~after a $500 million payment to the ~~$2.4 billion, in~~financial institution pursuant to our ASR agreement.

Accelerated Stock Repurchase. In November 2015, ~~our Board of Directors authorized the Company~~we entered into an ASR agreement with a financial institution to ~~pursue~~repurchase an ~~Accelerated Share Repurchase ("ASR")~~aggregate of $500 ~~million. The Company expects to execute the ASR in~~million of our common stock. During the third quarter of fiscal ~~2016.~~2016, we made an upfront payment of $500 million to the financial institution pursuant to the ASR agreement, and received and retired an initial delivery of 19.9 million shares of our common stock. On January 15, 2016, which was in our fourth quarter of fiscal 2016, the ASR was completed, which, per the terms of the agreement, resulted in our receiving an additional 5.0 million shares of our common stock. The total shares received and retired under the terms of the ASR were 24.9 million, with an average price paid per share of $20.08. The $500 million upfront payment is presented under the caption repurchase of common stock in our Condensed Consolidated Statements of Cash Flows.

Table of Contents

Capital Return Program. On January 29, 2016, our Board of Directors announced a $2.0 billion capital return program.

Dividend Program. During the ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, we declared and paid aggregate cash dividends of ~~$205~~$303 million, or ~~$0.30~~$0.45 per common share, and we paid dividend equivalent rights of $5$9 million. During the ~~six~~nine months ended ~~October 3, 2014,~~January 2, 2015, we declared and paid cash dividends of ~~$207~~$311 million or ~~$0.30~~$0.45 per common share. Our restricted stock and performance-based stock units have dividend equivalent rights entitling holders to dividend equivalents to be paid in the form of cash upon vesting for each share of the underlying units.

On ~~November 5, 2015,~~February 4, 2016, we declared a cash dividend of $0.15 per share of common stock to be paid on ~~December~~March 16, ~~2015~~2016 to all stockholders of record as of the close of business on ~~November 23, 2015.~~February 22, 2016. All shares of common stock issued and outstanding, and unvested restricted stock and performance-based stock, as of the record date will be entitled to the dividend and dividend equivalents, respectively. Any future dividends and dividend equivalents will be subject to the approval of our Board of Directors.

~~Table of Contents~~

Restructuring Plans. In fiscal 2015, we announced plans to separate our security and information management businesses. In order to separate the businesses, we ~~initiated~~put a restructuring plan in place to properly align personnel, and ~~are incurring~~have therefore incurred associated severance and facilities costs. We ~~are~~ also ~~incurring~~incurred separation costs in the form of advisory, consulting and disentanglement expenses. These actions were completed in the fourth quarter of fiscal 2016 with the sale of Veritas on January 29, 2016. Total restructuring and separation costs in the fourth quarter of fiscal 2016 are expected to be ~~substantially completed by the end of the third quarter of fiscal 2016. Total remaining restructuring and separation costs are expected~~$30 million to ~~be between $50 million and $100~~$40 million, excluding ~~tax implications and potential advisor~~advisory fees of approximately $40 million payable upon separation. As of ~~October 2, 2015,~~January 1, 2016, liabilities for excess facility obligations at several locations around the world are expected to be paid throughout the respective lease terms, ~~as we continue to occupy these facilities,~~ the longest of which extends through fiscal ~~2019.~~2020.

Note Repayment. In the second fiscal quarter of 2016, the principal balance of our 2.75% Senior Notes due September 2015 matured and was settled by a cash payment of $350 million along with the $5 million semiannual interest payment.

Cash flows

The following table summarizes, for the periods indicated, selected items in our Condensed Consolidated Statements of Cash Flows:

Six Months Ended
October 2, 2015 October 3, 2014
(Dollars in millions)
Net cash provided by (used in):
Operating activities $ 434
$ 466
Investing activities 615
(722 )
Financing activities (814 ) (404 )



	Nine Months Ended
	January 1, 2016			January 2, 2015
	(Dollars in millions)
Net cash provided by (used in):
Continuing operating activities	$	316		$	(50	)
Continuing investing activities	731			(952		)
Continuing financing activities	(1,514		)	(615		)

~~Operating~~Continuing operating activities

We expect cash from our continuing operating activities to fluctuate in future periods as a result of a number of factors, including the timing of our billings and collections, our operating results, the timing and amount of tax and other liability payments.

Net cash provided by continuing operating activities was ~~$434~~$316 million for the ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, which resulted from ~~net~~ income from continuing operations of ~~$273~~$192 million adjusted for non-cash items, including depreciation and amortization charges of ~~$204~~$227 million and stock-based compensation expense of ~~$133~~$118 million, as well as net changes in ~~accounts receivable and accounts payable~~deferred income taxes resulting in inflows of ~~$255 million and $50 million, respectively. These amounts were partially offset by decreases in deferred revenue of $397 million and accrued compensation of $107 million.~~

Net cash provided by operating activities was $466 million for the six months ended October 3, 2014, which resulted from net income of $480 million adjusted for non-cash items, including depreciation and amortization charges of $229 million, as well as net changes in accounts receivable resulting in inflows of $268$63 million. These amounts were partially offset by decreases in deferred revenue of ~~$374~~$175 million and income taxes payable of ~~$101~~$94 million.

Net cash used in continuing operating activities was $50 million for the nine months ended January 2, 2015, which resulted from decreases in income taxes payable of $237 million, deferred revenue of $199 million, and ~~accrued~~accounts payable of $69 million. These amounts were partially offset by income from continuing operations of $54 million adjusted for non-cash items, including depreciation and amortization charges of $268 million and stock-based compensation expense of ~~$50~~$94 million, as well as a net change in deferred income taxes, resulting in inflows of $29 million.

~~Investing~~Continuing investing activities

Net cash provided by continuing investing activities was ~~$615~~$731 million for the ~~six~~nine months ended ~~October 2, 2015, and was~~January 1, 2016, primarily due to the proceeds of ~~$1.1~~$1.3 billion from maturities and sales of our short-term investments partially offset by purchases of ~~$327~~$377 million of short-term investments and payments of ~~$149~~$225 million for capital expenditures.

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Net cash used in continuing investing activities was ~~$722~~$952 million for ~~six~~nine months ended ~~October 3, 2014, and was~~January 2, 2015, primarily due to the ~~purchase~~purchases of ~~$1.1~~$1.4 billion of short-term investments and payments of ~~$199~~$249 million for capital expenditures, partially offset by ~~$567~~$765 million in proceeds from maturities and sales of our short-term investments.

~~Financing~~Continuing financing activities

Net cash used in continuing financing activities was ~~$814 million~~$1.5 billion for the ~~six~~nine months ended ~~October 2, 2015, which was~~January 1, 2016, primarily due to repurchases of our common stock of $868 million, which includes a $500 million payment to the financial institution pursuant to our ASR agreement, the repayment of debt and other obligations of ~~$367 million, repurchases of our common stock of $250~~$368 million, and cash dividend and dividend equivalent payments of ~~$210~~$312 million.

Net cash used in continuing financing activities was ~~$404~~$615 million for the ~~six~~nine months ended ~~October 3, 2014, which was~~January 2, 2015, primarily due to repurchases of our common stock of ~~$250~~$375 million and cash dividend payments of ~~$207~~$311 million, partially offset by net proceeds from sales of common stock through employee stock benefit plans of ~~$66~~$78 million.

Contractual obligations

There have been no significant changes outside the ordinary schedule of our contractual obligations during the ~~six~~nine months ended ~~October 2, 2015,~~January 1, 2016, to the contractual obligations disclosed in Management's Discussion and Analysis of Financial

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Condition and Results of Operations, set forth in Part II, Item 7, of our Annual Report on Form 10-K for the fiscal year ended April 3, 2015.

Indemnifications

Item 3. Quantitative and Qualitative Disclosures about Market Risk

~~There~~We are exposed to various market risks related to fluctuations in interest rates and foreign currency exchange rates. We may use derivative financial instruments to mitigate certain risks in accordance with our investment and foreign exchange policies. We do not use derivatives or other financial instruments for speculative trading purposes.

Interest rate risk

As of January 1, 2016, we had $1.8 billion in principal amount of fixed-rate senior notes outstanding, with a carrying amount of $1.7 billion and a fair value of $1.8 billion, which is based on level 2 inputs. As of April 3, 2015, we had $2.1 billion in principal amount of fixed-rate senior notes outstanding, with a carrying amount of $2.1 billion and a fair value of $2.2 billion, which is based on level 2 inputs. We have ~~been no significant~~performed sensitivity analyses as of January 1, 2016 and April 3, 2015 by using a modeling technique that measures the change in the fair values arising from a hypothetical 50 bps movement in the levels of market interest rates, with all other variables held constant. On January 1, 2016 and April 3, 2015, a hypothetical 50 bps increase or decrease in market interest rates would change the fair value of the fixed-rate senior notes by a decrease of approximately $32 million and $39 million, respectively and an increase of approximately $33 million and $40 million, respectively. However, this hypothetical change in market interest rates would not impact the interest expense on the fixed-rate debt.

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Foreign currency exchange rate risk

We conduct business in 44 currencies through our worldwide operations and, as such, we are exposed to foreign currency risk. Our entities conduct their businesses in the primary local currency in which they operate, however, they may conduct business in other currencies. To the extent our entities hold monetary assets or liabilities, earn revenues or expend costs in currencies other than that entity's functional currency, they will be exposed to foreign exchange gains or losses and impacts to margins as a result. As part of our foreign currency risk mitigation strategy, we have entered into foreign exchange forward contracts with up to six months in duration to help mitigate foreign exchange risk, however we are not able to mitigate all of our foreign exchange risk. We have considered historical trends in exchange rates and determined that it is possible that adverse changes in exchange rates for any currency could be experienced. The estimated impacts of a ten percent appreciation or depreciation of foreign currency are as follows:



	January 1, 2016									April 3, 2015
				Change in Fair Value Due to 10%									Change in Fair Value Due to 10%
Foreign Exchange Forward Contract	Notional Amount			Appreciation			Depreciation			Notional Amount			Appreciation			Depreciation
	(Dollars in millions)
Purchased	$	845		$	85		$	(85	)	$	102		$	10		$	(10	)
Sold	(421		)	(42		)	42			(195		)	(19		)	19
Total net outstanding contracts	$	424		$	43		$	(43	)	$	(93	)	$	(9	)	$	9

We do not use derivative financial instruments for speculative trading purposes, nor do we hedge our ~~market risk exposures during~~foreign currency exposure in a manner that entirely offsets the ~~six months ended October 2, 2015, as compared to~~effects of the ~~market risk exposures disclosed~~changes in ~~Management’s Discussion and Analysis of Financial Condition and Results of Operations, set forth in Part II, Item 7A, of our Annual Report on Form 10-K for the fiscal year ended April 3, 2015.~~foreign exchange rates.

Item 4. Controls and Procedures

a)(a) Evaluation of Disclosure Controls and Procedures

The SEC defines the term “disclosure controls and procedures” to mean a company’s controls and other procedures that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Exchange Act is recorded, processed, summarized, and reported, within the time periods specified in the SEC’s rules and forms. “Disclosure controls and procedures” include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Our disclosure controls and procedures are designed to provide reasonable assurance that such information is accumulated and communicated to our management. Our management (with the participation of our Chief Executive Officer and Chief Financial Officer) has conducted an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act). Based on such evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of the end of the period covered by this report.

b)(b) Changes in Internal Control over Financial Reporting

~~There were~~During the three months ended January 1, 2016, we completed the implementation of a new enterprise resource planning ("ERP") system for Veritas and, accordingly, modified certain existing control processes as well as implemented new control processes to adapt to changes for the new ERP system. The new ERP system was implemented in connection with the operational separation of Veritas and to meet the conditions for the sale of Veritas to Carlyle. Additionally, we have implemented procedures surrounding the review of discontinued operations amounts. We have taken the necessary steps to monitor and maintain appropriate internal control over financial reporting during fiscal 2016. Other than these new control procedures, there was no ~~changes~~other material change in our internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) during the three months ended ~~October 2, 2015,~~January 1, 2016, that ~~have~~has materially affected, or ~~are~~is reasonably likely to materially affect, our internal control over financial reporting.

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Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal controls will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within our company have been detected.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Information with respect to this Item may be found in Note 7, Commitments and Contingencies, of ~~the~~ Notes to Condensed Consolidated Financial Statements in this Form 10-Q, which information is incorporated herein by reference.

Item 1A. Risk Factors

A description of the risks associated with our business, financial condition, and results of operations is set forth in Part I, Item 1A, of our Annual Report on Form 10-K for the fiscal year ended April 3, 2015. There have been no material changes in our risks from such description.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Repurchases of our equity securities

All stock repurchases during the three months ended ~~October 2, 2015,~~January 1, 2016, were purchased under publicly announced plans or programs and are summarized as follows:



	Total Number of Shares Purchased		Average Price Paid per Share			Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs
	(In millions, except per share data)
October 3, 2015 to October 30, 2015:
Open market purchases	4.4		$	20.68		$	2,318
October 31, 2015 to November 27, 2015:
Open market purchases	1.3		$	20.65		$	2,290
ASR	19.9	⁽¹⁾			⁽¹⁾	$	1,790	⁽²⁾
November 28, 2015 to January 1, 2016:
Open market purchases	—	⁽¹⁾	$	—		$	1,790	⁽²⁾
Total	25.6

______________________

Total Number of Shares Purchased Average Price Paid per Share Maximum Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs
(In millions, except per share data)
July 4, 2015 to July 31, 2015 —
$ —
$ 1,068
August 1, 2015 to August 28, 2015 7.6
$ 21.13
$ 2,408
August 29, 2015 to October 2, 2015 —
$ —
$ 2,408
Total 7.6
$ 21.13

(1)

Represents shares related to our ASR agreement. In November 2015, we entered into an ASR agreement with a financial institution to repurchase an aggregate of $500 million of our common stock. This agreement was entered into under our previously announced share repurchase authorization. During the third quarter of fiscal 2016, we made an upfront payment of $500 million to the financial institution pursuant to the ASR agreement, and received and retired an initial delivery of 19.9 million shares of our common stock. On January 15, 2016, which was in our fourth quarter of fiscal 2016, the ASR agreement was completed, which, per the terms of the agreement, resulted in us receiving an additional 5.0 million shares of our common stock (these shares were excluded from the table above, as they were received after January 1, 2016). The total shares received under the terms of the ASR were 24.9 million, with an average price paid per share of $20.08.


(2)	The approximate dollar value of the shares that may yet be purchased under the plans or programs is reduced by the $500 million that reflects the aggregate value of the stock held back by the financial institution pending final settlement of our ASR agreement with this firm.

Through our stock repurchase programs we have repurchased shares on a quarterly basis since the fourth quarter of fiscal 2004. Under the program, shares may be repurchased on the open market and through ASRs. On August 9, 2015, our Board of Directors authorized a new $1.5 billion stock repurchase program which commenced immediately and does not have an expiration date. This is in addition to the remaining amount authorized for future repurchase under our previous program.

Item 6. Exhibits

The information required by this Item is set forth in the Exhibit Index that follows the signature page of this Report.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



	SYMANTEC CORPORATION
	(Registrant)

	By:	/s/ Michael A. Brown
		Michael A. Brown President, Chief Executive Officer and Director

	By:	/s/ Thomas J. Seifert
		Thomas J. Seifert Executive Vice President and Chief Financial Officer

~~November 6, 2015~~February 4, 2016

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EXHIBIT INDEX

Exhibit
Number
Incorporated by Reference Filed with this 10-Q
Exhibit Description Form File Number Exhibit File Date
2.01 Purchase Agreement By and Between Symantec Corporation and Havasu Holdings Ltd. dated August 11, 2015 8-K 000-17781 2.1 8/13/2015
31.01 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 X
31.02    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002                X
32.01†    Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                X
32.02†    Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002                X
101.INS    XBRL Instance Document                X
101.SCH    XBRL Taxonomy Schema Linkbase Document                X
101.CAL    XBRL Taxonomy Calculation Linkbase Document                X
101.DEF    XBRL Taxonomy Definition Linkbase Document                X
101.LAB    XBRL Taxonomy Labels Linkbase Document                X
101.PRE    XBRL Taxonomy Presentation Linkbase Document                X

Exhibit

Number

Incorporated by Reference

Filed with this 10-Q

Exhibit Description

Form

File Number

Exhibit

File Date

2.01

Amendment, dated January 19, 2016, to Purchase Agreement dated as of August 11, 2015, by and between Symantec Corporation and Veritas Holdings Ltd.

8-K

000-17781

2.01

1/20/2016

10.01*

Symantec Corporation 2008 Employee Stock Purchase Plan, as amended

10.02

Master Confirmation - Accelerated Stock Buyback, dated as of November 9, 2015, between Symantec Corporation and Barclays Bank PL

8-K

000-17781

10.01

11/10/2015

31.01

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.02

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.01†

Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.02†

Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS

XBRL Instance Document

101.SCH

XBRL Taxonomy Schema Linkbase Document

101.CAL

XBRL Taxonomy Calculation Linkbase Document

101.DEF

XBRL Taxonomy Definition Linkbase Document

101.LAB

XBRL Taxonomy Labels Linkbase Document

101.PRE

XBRL Taxonomy Presentation Linkbase Document



*	~~Certain schedules have been omitted. The Registrant agrees to furnish supplementally~~Indicates a ~~copy of any such schedules to the Securities and Exchange Commission upon request.~~management contract or compensatory plan or arrangement.
†	This exhibit is being furnished, rather than filed, and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.

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	October 2, 2015		April 3, 2015 *
	(Unaudited) (In millions, except par value)
ASSETS
Current assets:
Cash and cash equivalents	$	3,097	$	2,874
Short-term investments	260		1,017
Accounts receivable, net	738		993
Deferred income taxes	207		152
Deferred commissions	112		131
Other current assets	250		255
Total current assets	4,664		5,422
Property and equipment, net	1,262		1,205
Intangible assets, net	572		628
Goodwill	5,847		5,847
Long-term deferred commissions	14		26
Other long-term assets	101		105
Total assets	$	12,460	$	13,233

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	326	$	213
Accrued compensation and benefits	289		398
Deferred revenue	2,766		3,109
Current portion of long-term debt	—		350
Other current liabilities	348		383
Total current liabilities	3,729		4,453
Long-term debt	1,740		1,746
Long-term deferred revenue	505		555
Long-term deferred tax liabilities	381		308
Long-term income taxes payable	132		134
Other long-term obligations	81		102
Total liabilities	6,568		7,298
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.01 par value, 3,000 shares authorized; 680 and 898 shares issued; 680 and 684 shares outstanding, respectively	7		7
Additional paid-in capital	5,794		6,094
Accumulated other comprehensive income	88		104
Retained earnings (accumulated deficit)	3		(270		)
Total stockholders’ equity	5,892		5,935
Total liabilities and stockholders’ equity	$	12,460	$	13,233

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