Document_And_Entity_Informatio
Document And Entity Information | 3 Months Ended | |
Jan. 31, 2015 | Feb. 27, 2015 | |
Entity Information [Line Items] | ||
Entity Registrant Name | BROCADE COMMUNICATIONS SYSTEMS INC | |
Entity Central Index Key | 1009626 | |
Current Fiscal Year End Date | -21 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | 31-Jan-15 | |
Document Fiscal Year Focus | 2015 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | FALSE | |
Entity Common Stock, Shares Outstanding | 421,726,760 |
Condensed_Consolidated_Stateme
Condensed Consolidated Statements Of Operations (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Net revenues: | ||
Product | $486,238 | $475,205 |
Service | 90,001 | 89,330 |
Total net revenues | 576,239 | 564,535 |
Cost of revenues: | ||
Product | 149,926 | 153,627 |
Service | 36,630 | 38,238 |
Total cost of revenues | 186,556 | 191,865 |
Gross margin | 389,683 | 372,670 |
Operating expenses: | ||
Research and development | 85,231 | 87,156 |
Sales and marketing | 140,238 | 132,665 |
General and administrative | 24,671 | 20,143 |
Amortization of intangible assets | 138 | 9,883 |
Restructuring and other related costs | 0 | 6,217 |
Gain on sale of network adapter business | 0 | -4,884 |
Total operating expenses | 250,278 | 251,180 |
Income from operations | 139,405 | 121,490 |
Interest expense | -25,424 | -9,196 |
Interest income and other loss, net | -559 | -1,336 |
Income before income tax | 113,422 | 110,958 |
Income tax expense | 26,155 | 30,074 |
Net income | $87,267 | $80,884 |
Net income per share—basic | $0.20 | $0.18 |
Net income per share—diluted | $0.20 | $0.18 |
Shares used in per share calculation—basic | 428,536 | 440,573 |
Shares used in per share calculation—diluted | 439,156 | 453,549 |
Cash dividends declared per share | $0.04 | $0 |
Condensed_Consolidated_Stateme1
Condensed Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net income | $87,267 | $80,884 | ||
Unrealized gains (losses) on cash flow hedges: | ||||
Change in unrealized gains and losses | -1,774 | -924 | ||
Net gains and losses reclassified into earnings | 603 | [1] | -31 | [1] |
Net unrealized losses on cash flow hedges | -1,171 | -955 | ||
Foreign currency translation adjustments | -4,221 | -823 | ||
Total other comprehensive loss | -5,392 | -1,778 | ||
Total comprehensive income | $81,875 | $79,106 | ||
[1] | For Condensed Consolidated Statements of Income classification of amounts reclassified from accumulated other comprehensive loss, see Note 10, “Derivative Instruments and Hedging Activities,†of the Notes to Condensed Consolidated Financial Statements. |
Condensed_Consolidated_Balance
Condensed Consolidated Balance Sheets (USD $) | Jan. 31, 2015 | Nov. 01, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $1,359,365 | $1,255,017 |
Restricted cash | 311,918 | 0 |
Accounts receivable, net of allowances for doubtful accounts of $107 and $80 at January 31, 2015, and November 1, 2014, respectively | 239,767 | 224,913 |
Inventories | 40,275 | 38,718 |
Deferred tax assets | 99,691 | 92,692 |
Prepaid expenses and other current assets | 43,498 | 46,665 |
Total current assets | 2,094,514 | 1,658,005 |
Property and equipment, net | 442,644 | 445,433 |
Goodwill | 1,567,718 | 1,567,723 |
Intangible assets, net | 33,633 | 26,658 |
Other assets | 44,972 | 35,856 |
Total assets | 4,183,481 | 3,733,675 |
Current liabilities: | ||
Accounts payable | 88,198 | 93,705 |
Accrued employee compensation | 96,598 | 169,018 |
Deferred revenue | 236,322 | 239,993 |
Current portion of long-term debt | 300,778 | 1,826 |
Other accrued liabilities | 84,134 | 82,766 |
Total current liabilities | 806,030 | 587,308 |
Long-term debt, net of current portion | 783,597 | 595,450 |
Non-current deferred revenue | 73,227 | 71,746 |
Non-current income tax liability | 47,451 | 39,647 |
Non-current deferred tax liabilities | 19,302 | 27,153 |
Other non-current liabilities | 4,289 | 4,310 |
Total liabilities | 1,733,896 | 1,325,614 |
Commitments and contingencies (Note 9) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 5,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock, $0.001 par value, 800,000 shares authorized: | ||
Issued and outstanding: 423,622 and 431,470 shares at January 31, 2015, and November 1, 2014, respectively | 424 | 431 |
Additional paid-in capital | 1,748,959 | 1,774,197 |
Accumulated other comprehensive loss | -24,206 | -18,814 |
Retained earnings | 724,408 | 652,247 |
Total stockholders’ equity | 2,449,585 | 2,408,061 |
Total liabilities and stockholders’ equity | $4,183,481 | $3,733,675 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 |
In Thousands, except Per Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowances | $107 | $80 |
Preferred stock, par value | $0.00 | $0.00 |
Preferred stock, shares authorized | 5,000 | 5,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 800,000 | 800,000 |
Common stock, shares issued | 423,622 | 431,470 |
Common stock, shares outstanding | 423,622 | 431,470 |
Condensed_Consolidated_Stateme2
Condensed Consolidated Statements Of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Cash flows from operating activities: | ||
Net income | $87,267 | $80,884 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Excess tax benefits from stock-based compensation | -16,102 | -14,335 |
Depreciation and amortization | 19,575 | 38,754 |
Loss on disposal of property and equipment | 444 | 2,348 |
Gain on sale of network adapter business | 0 | -4,884 |
Amortization of debt issuance costs and debt discount | 1,056 | 281 |
Call premium cost and write-off of debt discount and debt issuance costs related to lenders that did not participate in refinancing | 15,122 | 0 |
Provision for doubtful accounts receivable and sales allowances | 2,403 | 1,567 |
Non-cash stock-based compensation expense | 24,082 | 18,588 |
Changes in assets and liabilities, net of acquisitions: | ||
Increase (Decrease) in Restricted Cash | -11,918 | 0 |
Accounts receivable | -17,256 | 29,771 |
Inventories | 1,155 | 2,097 |
Prepaid expenses and other assets | -5,746 | 3,486 |
Deferred tax assets | 494 | 95 |
Accounts payable | -8,776 | -8,077 |
Accrued employee compensation | -77,033 | -39,208 |
Deferred revenue | -2,190 | -5,414 |
Other accrued liabilities | -1,423 | 10,455 |
Restructuring liabilities | -761 | -6,939 |
Net cash provided by operating activities | 10,393 | 109,469 |
Cash flows from investing activities: | ||
Purchases of property and equipment | -16,514 | -12,966 |
Purchase of intangible assets | -7,750 | 0 |
Proceeds from collection of note receivable | 250 | 250 |
Proceeds from sale of network adapter business | 0 | 9,995 |
Net cash used in investing activities | -24,014 | -2,721 |
Cash flows from financing activities: | ||
Payment of debt issuance costs | -409 | 0 |
Payment of principal related to capital leases | -1,154 | -608 |
Common stock repurchases | -128,966 | -140,380 |
Proceeds from issuance of common stock | 21,036 | 32,410 |
Payment of cash dividends to stockholders | -15,106 | 0 |
Proceeds from convertible notes | 565,656 | 0 |
Purchase of convertible hedge | -86,135 | 0 |
Proceeds from issuance of warrants | 51,175 | 0 |
Excess tax benefits from stock-based compensation | 16,102 | 14,335 |
Increase in restricted cash | -300,000 | 0 |
Net cash provided by (used in) financing activities | 122,199 | -94,243 |
Effect of exchange rate fluctuations on cash and cash equivalents | -4,230 | -815 |
Net increase in cash and cash equivalents | 104,348 | 11,690 |
Cash and cash equivalents, beginning of period | 1,255,017 | 986,997 |
Cash and cash equivalents, end of period | 1,359,365 | 998,687 |
Supplemental disclosures of cash flow information: | ||
Cash paid for interest | 17,333 | 17,265 |
Cash paid for income taxes | $13,128 | $4,074 |
Basis_Of_Presentation
Basis Of Presentation | 3 Months Ended |
Jan. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis Of Presentation | Basis of Presentation |
Brocade Communications Systems, Inc. (“Brocade” or the “Company”) has prepared the accompanying Condensed Consolidated Financial Statements pursuant to the rules and regulations of the United States (“U.S.”) Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. The Condensed Consolidated Balance Sheet as of November 1, 2014, was derived from the Company’s audited consolidated financial statements, but does not include all disclosures required by U.S. GAAP. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended November 1, 2014. | |
The accompanying Condensed Consolidated Financial Statements are unaudited but, in the opinion of the Company’s management, reflect all adjustments—including normal recurring adjustments—that management considers necessary for a fair presentation of these Condensed Consolidated Financial Statements. The results for the interim periods presented are not necessarily indicative of the results for the full fiscal year or any other future period. | |
The Company’s fiscal year is a 52- or 53-week period ending on the last Saturday in October or the first Saturday in November, respectively. Fiscal year 2015 is a 52-week fiscal year and fiscal year 2014 was a 53-week fiscal year. The second quarter of fiscal year 2014 was a 14-week quarter, which was one week longer than a typical quarter. | |
The Condensed Consolidated Financial Statements include the accounts of Brocade and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. | |
Use of Estimates in Preparation of Condensed Consolidated Financial Statements | |
The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, revenue recognition, sales allowances and programs, allowance for doubtful accounts, stock-based compensation, purchase price allocations, warranty obligations, inventory valuation and purchase commitments, restructuring costs, incentive compensation, facilities lease losses, impairment of goodwill and intangible assets, litigation, and income taxes. Actual results may differ materially from these estimates. |
Summary_Of_Significant_Account
Summary Of Significant Accounting Policies | 3 Months Ended |
Jan. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary Of Significant Accounting Policies | Summary of Significant Accounting Policies |
There have been no material changes in the Company’s significant accounting policies for the three months ended January 31, 2015, as compared to the significant accounting policies disclosed in Brocade’s Annual Report on Form 10-K for the fiscal year ended November 1, 2014. | |
New Accounting Pronouncements or Updates Recently Adopted | |
In March 2013, the Financial Accounting Standards Board (“FASB”) issued an update to Accounting Standards Codification (“ASC”) 830, Foreign Currency Matters: Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. Under this update, an entity is required to release any cumulative translation adjustment into net income when the entity ceases to have a controlling financial interest resulting from the complete or substantially complete liquidation of a subsidiary or group of assets within a foreign entity. This update should be applied prospectively. The Company adopted this update in the first quarter of fiscal year 2015. There was no material impact on its financial position, results of operations, or cash flows. | |
Recent Accounting Pronouncements or Updates That Are Not Yet Effective | |
In April 2014, the FASB issued an update to ASC 205, Presentation of Financial Statements, and ASC 360, Property, Plant, and Equipment: Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. Under this update, a discontinued operation may include a component of an entity or a group of components of an entity, or a business or nonprofit activity. Only those disposals of components of an entity that represent a strategic shift that has, or will have, a major effect on an entity’s operations and financial results will be reported as discontinued operations in the financial statements. This update should be applied prospectively and will be adopted by the Company in the first quarter of fiscal year 2016. Early adoption is permitted, but only for disposals that have not been reported in financial statements previously issued. The Company is currently evaluating the impact of this update on its consolidated financial statements. | |
In May 2014, the FASB issued an update to ASC 606, Revenue from Contracts with Customers, that will supersede virtually all existing revenue guidance. Under this update, an entity is required to recognize revenue upon transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. As such, an entity will need to use more judgment and make more estimates than under the current guidance. This update should be applied retrospectively either to each prior reporting period presented in the financial statements, or only to the most current reporting period presented in the financial statements with a cumulative effect adjustment recorded in the retained earnings. This update becomes effective and will be adopted by the Company in the first quarter of fiscal year 2018. Early adoption is not permitted. The Company is currently evaluating the impact of this update on its consolidated financial statements. | |
Concentrations | |
Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash, cash equivalents, and accounts receivable. Cash and cash equivalents are primarily maintained at five major financial institutions. Deposits held with banks may be redeemed upon demand and may exceed the amount of insurance provided on such deposits. | |
A majority of the Company’s accounts receivable balance is derived from sales to original equipment manufacturer (“OEM”) partners in the computer storage and server industry. As of January 31, 2015, one customer individually accounted for 24% of total accounts receivable and no other customers exceeded 10% of total accounts receivable. As of November 1, 2014, three customers individually accounted for 15%, 12%, and 11% of total accounts receivable, for a combined total of 38% of total accounts receivable. The Company performs ongoing credit evaluations of its customers and generally does not require collateral on accounts receivable balances. The Company has established reserves for credit losses, sales allowances, and other allowances. | |
For the three months ended January 31, 2015, three customers individually accounted for 20%, 14%, and 10% of the Company’s total net revenues for a combined total of 44% of total net revenues. For the three months ended January 25, 2014, four customers individually accounted for 18%, 18%, 11%, and 10% of the Company’s total net revenues for a combined total of 57% of total net revenues. | |
The Company currently relies on single and limited sources for multiple key components used in the manufacture of its products. Additionally, the Company relies on multiple contract manufacturers (“CMs”) for the production of its products. Although the Company uses standard parts and components for its products where possible, the Company’s CMs currently purchase, on the Company’s behalf, several key components used in the manufacture of products from single or limited supplier sources. |
Divestitures
Divestitures | 3 Months Ended |
Jan. 31, 2015 | |
Business Combinations [Abstract] | |
Divestitures | Divestitures |
On January 17, 2014, the Company completed the sale of its network adapter business to QLogic Corporation, as part of the Company’s business strategy to focus development on a portfolio of high performance networking products and services—both hardware and software-based—that meet the demands of today’s data centers whether virtualized or cloud based. | |
The net carrying amount of the network adapter business’ assets and liabilities at the time of the divestiture was $5.1 million, comprised primarily of associated goodwill of $4.1 million. The sale resulted in a gain of $4.9 million in the three months ended January 25, 2014, which is presented in the Company’s Condensed Consolidated Statements of Income as “Gain on sale of network adapter business.” |
Goodwill_And_Intangible_Assets
Goodwill And Intangible Assets | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
Goodwill And Intangible Assets | Goodwill and Intangible Assets | |||||||||||||||
The following table presents a summary of the net carrying value of the Company’s intangible assets (in thousands): | ||||||||||||||||
January 31, | November 1, | |||||||||||||||
2015 | 2014 | |||||||||||||||
Indefinite-lived intangible assets | ||||||||||||||||
Goodwill | $ | 1,567,718 | $ | 1,567,723 | ||||||||||||
In-process research and development (1) | 15,110 | 15,110 | ||||||||||||||
Finite-lived intangible assets | ||||||||||||||||
Total intangible assets subject to amortization (2) | 18,523 | 11,548 | ||||||||||||||
Total intangible assets | $ | 1,601,351 | $ | 1,594,381 | ||||||||||||
-1 | Acquired in-process research and development (“IPR&D”) is an intangible asset accounted for as an indefinite-lived asset until the completion or abandonment of the associated research and development effort. If the research and development effort associated with the IPR&D is successfully completed, then the IPR&D intangible asset will be amortized over its estimated useful life to be determined at the date the effort is completed. The development effort on the IPR&D intangible asset is expected to be completed by the first half of fiscal year 2016. | |||||||||||||||
(2) | During the three months ended January 31, 2015, the Company purchased a perpetual, non-exclusive license to certain patents for $7.8 million. | |||||||||||||||
The following table summarizes goodwill activity by reportable segment for the three months ended January 31, 2015 (in thousands): | ||||||||||||||||
SAN | Internet Protocol (“IP”) Networking Products | Global Services | Total | |||||||||||||
Products | ||||||||||||||||
Balance at November 1, 2014 | ||||||||||||||||
Goodwill | $ | 176,346 | $ | 1,365,175 | $ | 155,416 | $ | 1,696,937 | ||||||||
Accumulated impairment losses | — | (129,214 | ) | — | (129,214 | ) | ||||||||||
176,346 | 1,235,961 | 155,416 | 1,567,723 | |||||||||||||
Tax and other adjustments during the three | (5 | ) | — | — | (5 | ) | ||||||||||
months ended January 31, 2015 (1) | ||||||||||||||||
Balance at January 31, 2015 | ||||||||||||||||
Goodwill | 176,341 | 1,365,175 | 155,416 | 1,696,932 | ||||||||||||
Accumulated impairment losses | — | (129,214 | ) | — | (129,214 | ) | ||||||||||
$ | 176,341 | $ | 1,235,961 | $ | 155,416 | $ | 1,567,718 | |||||||||
(1) | The goodwill adjustments during the three months ended January 31, 2015, were primarily a result of tax benefits from the exercise of stock awards of acquired companies. | |||||||||||||||
The Company conducts the goodwill impairment test annually, as of the first day of the second fiscal quarter, and whenever events occur or facts and circumstances indicate it is more likely than not that the fair value of a reporting unit has fallen below its carrying amount. For the annual goodwill impairment test, the Company uses the income approach, the market approach, or a combination thereof to determine each reporting unit’s fair value. The income approach provides an estimate of fair value based on discounted expected future cash flows (“DCF”). The market approach provides an estimate of fair value applying various observable market-based multiples to the reporting unit’s operating results and then applying an appropriate control premium. For the fiscal year 2014 annual goodwill impairment test, the Company used a combination of approaches to estimate each reporting unit’s fair value. The Company believed that, at the time of the impairment testing performed in the second fiscal quarter of 2014, the income approach and the market approach were equally representative of a reporting unit’s fair value. | ||||||||||||||||
Determining the fair value of a reporting unit or an intangible asset requires judgment and involves the use of significant estimates and assumptions. The Company based its fair value estimates on assumptions it believes to be reasonable, but inherently uncertain. Estimates and assumptions with respect to the determination of the fair value of its reporting units using the income approach include, among other inputs: | ||||||||||||||||
• | The Company’s operating forecasts; | |||||||||||||||
• | Revenue growth rates; and | |||||||||||||||
• | Risk-commensurate discount rates and costs of capital. | |||||||||||||||
The Company’s estimates of revenues and costs are based on historical data, various internal estimates, and a variety of external sources, and are developed as part of our regular long-range planning process. The control premium used in market or combined approaches is determined by considering control premiums offered as part of the acquisitions that have occurred in market segments that are comparable with the Company’s reporting units. | ||||||||||||||||
Based on the results of the annual goodwill impairment analysis performed during the second fiscal quarter of 2014, the Company determined that no impairment needed to be recorded for Storage Area Networking (“SAN”) Products, Ethernet Switching & IP Routing, and Global Services reporting units, as these reporting units passed the first step of goodwill impairment testing. | ||||||||||||||||
However, the Company determined that the fair value of the ADP reporting unit was below the reporting unit’s carrying value. Accordingly, the Company performed the second step of the goodwill impairment test to measure the amount of the impairment. During the second step, the Company assigned the ADP reporting unit’s fair value to the reporting unit’s assets and liabilities, using the relevant acquisition accounting guidance, to determine the implied fair value of the reporting unit’s goodwill. The implied fair value of the ADP reporting unit was below the carrying cost and, as a result, an impairment loss of $83.4 million was recorded. | ||||||||||||||||
As of January 31, 2015, there were no facts and circumstances that indicated that the fair value of the reporting units may be less than their current carrying amount since the annual goodwill impairment analysis performed during the second quarter of fiscal year 2014. | ||||||||||||||||
Intangible assets other than goodwill are amortized on a straight-line basis over the following estimated remaining useful lives, unless the Company has determined these lives to be indefinite. The Company did not incur costs to renew or extend the term of recognized intangible assets during the three months ended January 31, 2015. The following tables present details of the Company’s finite-lived intangible assets (in thousands, except for weighted-average remaining useful life): | ||||||||||||||||
January 31, 2015 | Gross | Accumulated | Net | Weighted- | ||||||||||||
Carrying | Amortization | Carrying | Average | |||||||||||||
Value | Value | Remaining | ||||||||||||||
Useful Life | ||||||||||||||||
(in years) | ||||||||||||||||
Trade name | $ | 590 | $ | 262 | $ | 328 | 2.8 | |||||||||
Core/developed technology | 12,080 | 2,602 | 9,478 | 4.07 | ||||||||||||
Patent license (1) | 7,750 | — | 7,750 | 18.74 | ||||||||||||
Customer relationships | 1,080 | 479 | 601 | 2.76 | ||||||||||||
Non-compete agreements | 810 | 444 | 366 | 1.76 | ||||||||||||
Total intangible assets | $ | 22,310 | $ | 3,787 | $ | 18,523 | 10.1 | |||||||||
November 1, 2014 | Gross | Accumulated | Net | Weighted- | ||||||||||||
Carrying | Amortization | Carrying | Average | |||||||||||||
Value | Value | Remaining | ||||||||||||||
Useful Life | ||||||||||||||||
(in years) | ||||||||||||||||
Trade name | $ | 590 | $ | 227 | $ | 363 | 3 | |||||||||
Core/developed technology | 12,080 | 1,964 | 10,116 | 4.3 | ||||||||||||
Customer relationships | 1,080 | 427 | 653 | 3.01 | ||||||||||||
Non-compete agreements | 810 | 394 | 416 | 2.01 | ||||||||||||
Total intangible assets | $ | 14,560 | $ | 3,012 | $ | 11,548 | 4.1 | |||||||||
(1) | The patent license was assigned an estimated useful life that reflects the Company’s consumption of the expected defensive benefits related to this intangible asset. The method of amortization for the patent license reflects the Company’s estimate of the pattern in which these expected defensive benefits will be consumed or otherwise used up by the Company, and is primarily driven by a mix of expiration patterns of the individual patents included in the license. | |||||||||||||||
The following table presents the amortization of finite-lived intangible assets included in the Condensed Consolidated Statements of Income (in thousands): | ||||||||||||||||
Three Months Ended | ||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||
Cost of revenues | $ | 637 | $ | 6,462 | ||||||||||||
Operating expenses | 138 | 9,883 | ||||||||||||||
Total | $ | 775 | $ | 16,345 | ||||||||||||
The following table presents the estimated future amortization of finite-lived intangible assets as of January 31, 2015 (in thousands): | ||||||||||||||||
Fiscal Year | Estimated | |||||||||||||||
Future | ||||||||||||||||
Amortization | ||||||||||||||||
2015 (remaining nine months) | $ | 3,173 | ||||||||||||||
2016 | 3,875 | |||||||||||||||
2017 | 3,476 | |||||||||||||||
2018 | 3,139 | |||||||||||||||
2019 | 1,680 | |||||||||||||||
Thereafter | 3,180 | |||||||||||||||
Total | $ | 18,523 | ||||||||||||||
Balance_Sheet_Details
Balance Sheet Details | 3 Months Ended | |||||||
Jan. 31, 2015 | ||||||||
Balance Sheet Details [Abstract] | ||||||||
Balance Sheet Details | Balance Sheet Details | |||||||
The following tables provide details of selected balance sheet items (in thousands): | ||||||||
January 31, | November 1, | |||||||
2015 | 2014 | |||||||
Inventories: | ||||||||
Raw materials | $ | 11,592 | $ | 10,491 | ||||
Finished goods | 28,683 | 28,227 | ||||||
Inventories, net | $ | 40,275 | $ | 38,718 | ||||
January 31, | November 1, | |||||||
2015 | 2014 | |||||||
Property and equipment: | ||||||||
Computer equipment | $ | 13,569 | $ | 13,679 | ||||
Software | 64,266 | 62,919 | ||||||
Engineering and other equipment (1) | 385,394 | 383,412 | ||||||
Furniture and fixtures (1) | 28,646 | 29,053 | ||||||
Leasehold improvements | 24,651 | 23,607 | ||||||
Land and building | 384,426 | 384,659 | ||||||
Subtotal | 900,952 | 897,329 | ||||||
Less: Accumulated depreciation and amortization (1), (2) | (458,308 | ) | (451,896 | ) | ||||
Property and equipment, net | $ | 442,644 | $ | 445,433 | ||||
(1) | Engineering and other equipment, furniture and fixtures, and accumulated depreciation and amortization include the following amounts under capital leases as of January 31, 2015, and November 1, 2014, respectively (in thousands): | |||||||
January 31, | November 1, | |||||||
2015 | 2014 | |||||||
Cost | $ | 11,925 | $ | 11,925 | ||||
Accumulated depreciation | (7,669 | ) | (7,209 | ) | ||||
Property and equipment, net, under capital leases | $ | 4,256 | $ | 4,716 | ||||
(2) | The following table presents the depreciation of property and equipment included on the Condensed Consolidated Statements of Income (in thousands): | |||||||
Three Months Ended | ||||||||
January 31, | January 25, | |||||||
2015 | 2014 | |||||||
Depreciation expense | $ | 18,800 | $ | 22,409 | ||||
Fair_Value_Measurements
Fair Value Measurements | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Fair Value Measurements | Fair Value Measurements | |||||||||||||||
The Company applies fair value measurements to both financial and non-financial assets and liabilities. The Company has no non-financial assets and liabilities that are required to be measured at fair value on a recurring basis as of January 31, 2015. | ||||||||||||||||
The fair value accounting guidance permits companies to elect fair value measurement for many financial instruments and certain other items that are not required to be accounted for at fair value. The Company did not elect to measure any eligible financial instruments or other assets at fair value as of January 31, 2015, and November 1, 2014. | ||||||||||||||||
Fair Value Hierarchy | ||||||||||||||||
The Company utilizes a fair value hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. | ||||||||||||||||
Assets and liabilities measured and recorded at fair value on a recurring basis as of January 31, 2015, were as follows (in thousands): | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | |||||||||||||
January 31, 2015 | Active Markets | Observable | Unobservable | |||||||||||||
for Identical | Inputs | Inputs | ||||||||||||||
Instruments | (Level 2) | (Level 3) | ||||||||||||||
(Level 1) | ||||||||||||||||
Assets: | ||||||||||||||||
Money market funds (1) | $ | 1,113,605 | $ | 1,113,605 | $ | — | $ | — | ||||||||
Derivative assets | 108 | — | 108 | — | ||||||||||||
Total assets measured at fair value | $ | 1,113,713 | $ | 1,113,605 | $ | 108 | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Derivative liabilities | $ | 3,310 | $ | — | $ | 3,310 | $ | — | ||||||||
Total liabilities measured at fair value | $ | 3,310 | $ | — | $ | 3,310 | $ | — | ||||||||
(1) | Money market funds are reported within “Cash and cash equivalents” on the Condensed Consolidated Balance Sheets. | |||||||||||||||
Assets and liabilities measured and recorded at fair value on a recurring basis as of November 1, 2014, were as follows (in thousands): | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | |||||||||||||
November 1, 2014 | Active Markets | Observable | Unobservable | |||||||||||||
for Identical | Inputs | Inputs | ||||||||||||||
Instruments | (Level 2) | (Level 3) | ||||||||||||||
(Level 1) | ||||||||||||||||
Assets: | ||||||||||||||||
Money market funds (1) | $ | 1,009,283 | $ | 1,009,283 | $ | — | $ | — | ||||||||
Derivative assets | 99 | — | 99 | — | ||||||||||||
Total assets measured at fair value | $ | 1,009,382 | $ | 1,009,283 | $ | 99 | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Derivative liabilities | $ | 1,937 | $ | — | $ | 1,937 | $ | — | ||||||||
Total liabilities measured at fair value | $ | 1,937 | $ | — | $ | 1,937 | $ | — | ||||||||
(1) | Money market funds are reported within “Cash and cash equivalents” on the Condensed Consolidated Balance Sheets. | |||||||||||||||
During the three months ended January 31, 2015, the Company had no transfers between levels of the fair value hierarchy of its assets and liabilities measured at fair value. |
Restructuring_and_Other_Costs
Restructuring and Other Costs | 3 Months Ended | |||||||||||||||||||
Jan. 31, 2015 | ||||||||||||||||||||
Restructuring and Related Activities [Abstract] | ||||||||||||||||||||
Restructuring and Other Costs | Restructuring and Other Related Costs | |||||||||||||||||||
The following table provides details of the Company’s restructuring and other charges (in thousands): | ||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
January 31, | January 25, | |||||||||||||||||||
2015 | 2014 | |||||||||||||||||||
Severance and benefits | $ | — | $ | (1,744 | ) | |||||||||||||||
Lease loss reserve and related costs | — | 7,961 | ||||||||||||||||||
Restructuring and other related costs | $ | — | $ | 6,217 | ||||||||||||||||
The following table provides a reconciliation of the Company’s beginning and ending restructuring liability balances (in thousands): | ||||||||||||||||||||
Fiscal 2013 Fourth Quarter Restructuring Plan | Prior Restructuring Plans | |||||||||||||||||||
Severance and Benefits | Contract Terminations and Other | Lease Loss Reserve and Related Costs | Lease Loss | Total | ||||||||||||||||
Reserve and Related Costs | ||||||||||||||||||||
Restructuring liabilities at November 1, 2014 | $ | 171 | $ | 42 | $ | 3,949 | $ | 994 | $ | 5,156 | ||||||||||
Cash payments | — | (42 | ) | (416 | ) | (112 | ) | (570 | ) | |||||||||||
Translation adjustment | — | — | (192 | ) | — | (192 | ) | |||||||||||||
Restructuring liabilities at January 31, 2015 | $ | 171 | $ | — | $ | 3,341 | $ | 882 | $ | 4,394 | ||||||||||
Current restructuring liabilities at January 31, 2015 | $ | 171 | $ | — | $ | 1,496 | $ | 396 | $ | 2,063 | ||||||||||
Non-current restructuring liabilities at January 31, 2015 | $ | — | $ | — | $ | 1,845 | $ | 486 | $ | 2,331 | ||||||||||
Fiscal 2013 Fourth Quarter Restructuring Plan | ||||||||||||||||||||
During the fiscal year ended October 26, 2013, and the first quarter of fiscal year 2014, the Company restructured certain business operations and reduced the Company’s operating expense structure. The restructuring plan was approved by the Company’s management and communicated to the Company’s employees in September 2013. The restructuring plan included a workforce reduction of approximately 250 employees, primarily in the engineering, sales, and marketing organizations, as well as the cancellation of certain nonrecurring engineering agreements and exits from certain leased facilities. The Company substantially completed the restructuring plan by the end of the first quarter of fiscal year 2014. | ||||||||||||||||||||
The Company reevaluates its estimates and assumptions on a quarterly basis and makes adjustments to the restructuring liabilities balance if necessary. During the three months ended January 31, 2015, there were no adjustments made to the restructuring liabilities balance, as there were no changes in its estimates or assumptions. | ||||||||||||||||||||
The restructuring and other related charges are included in “Restructuring and other related costs” on the Condensed Consolidated Statements of Income. | ||||||||||||||||||||
Prior Restructuring Plans | ||||||||||||||||||||
Prior to fiscal year 2013, the Company also recorded charges related to estimated facilities lease losses, net of expected sublease income, due to consolidation of real estate space as a result of acquisitions. | ||||||||||||||||||||
Cash payments for facilities that are part of the Company’s lease loss reserve are expected to be paid over the respective lease terms through fiscal year 2021. |
Borrowings
Borrowings | 3 Months Ended | ||||||||||||||||
Jan. 31, 2015 | |||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||
Borrowings | Borrowings | ||||||||||||||||
The following table provides details of the Company’s long-term debt (in thousands, except years and percentages): | |||||||||||||||||
January 31, 2015 | November 1, 2014 | ||||||||||||||||
Maturity | Stated Annual Interest Rate | Amount | Effective Interest Rate | Amount | Effective Interest Rate | ||||||||||||
Convertible Senior Unsecured Notes | |||||||||||||||||
2020 Convertible Notes | 2020 | 1.38% | $ | 575,000 | 4.98 | % | $ | — | — | % | |||||||
Senior Unsecured Notes: | |||||||||||||||||
2023 Notes | 2023 | 4.63% | 300,000 | 4.83 | % | 300,000 | 4.83 | % | |||||||||
Senior Secured Notes: | |||||||||||||||||
2020 Notes | 2015 | 6.88% | 300,000 | 8.39 | % | 300,000 | 7.26 | % | |||||||||
Capital lease obligations | 2016 | 5.00% | 963 | 5 | % | 2,115 | 5.37 | % | |||||||||
Total long-term debt | 1,175,963 | 602,115 | |||||||||||||||
Less: | |||||||||||||||||
Unamortized discount | 91,588 | 4,839 | |||||||||||||||
Current portion of long-term debt | 300,778 | 1,826 | |||||||||||||||
Long-term debt, net of current portion | $ | 783,597 | $ | 595,450 | |||||||||||||
Convertible Senior Unsecured Notes | |||||||||||||||||
On January 14, 2015, the Company issued $575.0 million aggregate principal amount of 1.375% convertible senior unsecured notes due 2020 (the “2020 Convertible Notes”) pursuant to an indenture, dated as of January 14, 2015, between the Company and Wells Fargo Bank, National Association, as the trustee (the “Offering”). Net of an original issue discount, the Company received $565.7 million in proceeds from the offering of the 2020 Convertible Notes. Concurrently with the closing of the Offering, the Company called for redemption its outstanding 6.875% senior secured notes due 2020 (the “2020 Notes”) and irrevocably deposited a portion of the net proceeds from the Offering with the trustee to discharge the 2020 Indenture as described below under “Senior Secured Notes”. | |||||||||||||||||
The 2020 Convertible Notes bear interest payable semi-annually on January 1 and July 1 of each year, beginning on July 1, 2015. No payments were made toward the principal of the 2020 Convertible Notes during the three months ended January 31, 2015. | |||||||||||||||||
The Company separately accounts for the liability and equity components of the 2020 Convertible Notes. The fair value of the liability component, used in the allocation between the liability and equity components as of the date of issuance, was based on the present value of cash flows using a discount rate of 4.57%, the Company’s borrowing rate for a similar debt instrument without the conversion feature. The carrying values of the liability and equity components of the 2020 Convertible Notes are as follows (in thousands): | |||||||||||||||||
January 31, | November 1, | ||||||||||||||||
2015 | 2014 | ||||||||||||||||
Principal | $ | 575,000 | $ | — | |||||||||||||
Less: Unamortized discount of the liability component | 88,457 | — | |||||||||||||||
Net carrying amount of liability component | $ | 486,543 | $ | — | |||||||||||||
Carrying amount of equity component | $ | 81,818 | $ | — | |||||||||||||
As of January 31, 2015, the remaining period of amortization for the discount is 4.92 years. During the three months ended January 31, 2015, the amount of interest cost recognized for amortization of the discount and for contractual interest coupon in relation to the 2020 Convertible Notes was $0.7 million and 0.4 million, respectively. No interest cost was recognized in relation to the 2020 Convertible Notes during the three months ended January 25, 2014. | |||||||||||||||||
As of January 31, 2015, the fair value of the 2020 Convertible Notes was approximately $591.0 million, which was estimated based on broker trading prices. | |||||||||||||||||
The 2020 Convertible Notes mature on January 1, 2020, unless repurchased or converted in accordance with their terms prior to such date. The 2020 Convertible Notes are not callable prior to their maturity. The 2020 Convertible Notes are convertible at an initial conversion rate of 62.7746 shares of common stock per $1,000 principal amount of the notes, which is equal to an initial conversion price of approximately $15.93 per share. 36.1 million shares are initially issuable upon conversion of the 2020 Convertible Notes. | |||||||||||||||||
Holders of the 2020 Convertible Notes may convert all or a portion of their notes prior to the close of business on the business day immediately preceding September 1, 2019, in multiples of $1,000 principal amount, only under the following circumstances: | |||||||||||||||||
• | During any fiscal quarter commencing after the fiscal quarter ending on May 2, 2015 (and only during such fiscal quarter), if the last reported sale price of common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding fiscal quarter is greater than or equal to 130% of the conversion price of the notes on each applicable trading day; | ||||||||||||||||
• | During the five-business-day period after any 10 consecutive trading day period in which the trading price per $1,000 principal amount of the notes for each trading day of that 10 consecutive trading day period was less than 98% of the product of the last reported sale price of common stock and the conversion rate of the notes on each such trading day; or | ||||||||||||||||
• | Upon the occurrence of certain corporate events as specified in the terms of the indenture governing the 2020 Convertible Notes. | ||||||||||||||||
On or after September 1, 2019, to the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert all or any portion of their notes regardless of the foregoing conditions. | |||||||||||||||||
As of January 31, 2015, the circumstances for conversion have not been triggered and the 2020 Convertible Notes were not convertible. The if-converted value of the 2020 Convertible Notes as of January 31, 2015, did not exceed the principal amount of the 2020 Convertible Notes. | |||||||||||||||||
If a fundamental change, as specified in the terms of the indenture governing the 2020 Convertible Notes, occurs prior to the maturity date, holders of the notes may require the Company to repurchase the 2020 Convertible Notes at a repurchase price equal to 100% of the principal amount of the 2020 Convertible Notes repurchased, plus accrued and unpaid interest, if any, up to the repurchase date. As of January 31, 2015, a fundamental change has not occurred and the 2020 Convertible Notes were not re-purchasable. | |||||||||||||||||
Convertible Note Hedge and Warrant Related to the Convertible Senior Unsecured Notes | |||||||||||||||||
In connection with the issuance of the 2020 Convertible Notes, the Company entered into convertible note hedge transactions with certain financial institutions (the “counterparties”) with respect to its common stock. Upon conversion of the 2020 Convertible Notes, the convertible note hedge transactions, subject to anti-dilution adjustments substantially identical to those in the 2020 Convertible Notes, give the Company the right to acquire approximately 36.1 million shares of common stock at an initial strike price of $15.93 per share. The convertible note hedge transactions are expected generally to reduce the potential common stock dilution, and/or offset potential cash payments in excess of the principal amount of converted notes, upon conversion of the notes in the event that the market price per share of our common stock, as measured under the terms of the convertible note hedge transactions, is greater than the strike price of the convertible note hedge transactions. The convertible note hedge transactions will be terminated on the maturity date of the 2020 Convertible Notes or earlier under certain circumstances. The convertible note hedge transactions cost of $86.1 million has been accounted for as an equity transaction. | |||||||||||||||||
Separately from the convertible note hedge transactions, the Company entered into warrant transactions with the counterparties pursuant to which the Company sold warrants to the counterparties to acquire, subject to customary anti-dilution adjustments, up to 36.1 million shares in the aggregate at an initial strike price of $20.65 per share. The primary reason the Company entered into these warrant transactions was to partially offset the cost of the convertible note hedge transactions. The warrants mature over 60 trading days commencing on April 1, 2020, and are exercisable solely on the maturity dates. The warrants are subject to net share settlement; however, the Company may elect to cash settle the warrants. The Company received gross proceeds of $51.2 million from the warrants transaction, which has been accounted for as an equity transaction. | |||||||||||||||||
In connection with the dilutive impact from the 2020 Convertible Notes and the convertible note hedge and warrant transactions that the Company entered into with certain financial institutions with respect to its common stock, see Note 15, “Net Income per Share,” of the Notes to Condensed Consolidated Financial Statements for further discussion. | |||||||||||||||||
Senior Unsecured Notes | |||||||||||||||||
In January 2013, the Company issued 4.625% senior unsecured notes in the aggregate principal amount of $300.0 million due 2023 (the “2023 Notes”) pursuant to an indenture, dated as of January 22, 2013 (the “2023 Indenture”), between the Company, certain domestic subsidiaries of the Company that have guaranteed the Company’s obligations under the 2023 Notes, and Wells Fargo Bank, National Association, as the trustee. The guarantees of the 2023 Notes were released upon the termination of the Senior Secured Credit Facility and discharge of the 2020 Indenture, and, as a result, the Company has ceased presenting condensed consolidated financial statements for the parent company, the former subsidiary guarantors, and non-guarantor subsidiaries effective in the first fiscal quarter of 2015. See Note 16, “Guarantor and Non-Guarantor Subsidiaries,” of the Notes to Condensed Consolidated Financial Statements. | |||||||||||||||||
The 2023 Notes bear interest payable semiannually on January 15 and July 15 of each year. No payments were made toward the principal of the 2023 Notes during the three months ended January 31, 2015. | |||||||||||||||||
As of January 31, 2015, and November 1, 2014, the fair value of the 2023 Notes was approximately $295.6 million and $292.4 million, respectively, which was estimated based on broker trading prices. | |||||||||||||||||
On or after January 15, 2018, the Company may redeem all or part of the 2023 Notes at the redemption prices set forth in the 2023 Indenture, plus accrued and unpaid interest, if any, up to the redemption date. At any time prior to January 15, 2018, the Company may redeem all or a part of the 2023 Notes at a price equal to 100% of the principal amount of the 2023 Notes, plus an applicable premium and accrued and unpaid interest, if any, up to the redemption date. In addition, at any time prior to January 15, 2016, the Company may redeem up to 35% of the principal amount of the 2023 Notes, using the net cash proceeds of one or more sales of the Company’s capital stock at a redemption price equal to 104.625% of the principal amount of the 2023 Notes redeemed, plus accrued and unpaid interest, if any, up to the redemption date. | |||||||||||||||||
If the Company experiences a specified change of control triggering event, it must offer to repurchase the 2023 Notes at a repurchase price equal to 101% of the principal amount of the 2023 Notes repurchased, plus accrued and unpaid interest, if any, up to the repurchase date. | |||||||||||||||||
The 2023 Indenture contains covenants that, among other things, restrict the ability of the Company and its subsidiaries to: | |||||||||||||||||
• | Incur certain liens and enter into certain sale-leaseback transactions; | ||||||||||||||||
• | Create, assume, incur, or guarantee additional indebtedness of the Company’s subsidiaries without such subsidiary guaranteeing the 2023 Notes on a pari passu basis; and | ||||||||||||||||
• | Consolidate or merge with, or convey, transfer, or lease all or substantially all of the Company’s or its subsidiaries’ assets. | ||||||||||||||||
These covenants are subject to a number of limitations and exceptions set forth in the 2023 Indenture. The 2023 Indenture also includes customary events of default, including cross-defaults to other debt of the Company and its subsidiaries. | |||||||||||||||||
Senior Secured Notes | |||||||||||||||||
In January 2010, the Company issued $300.0 million in aggregate principal amount of the 2020 Notes pursuant to an indenture, dated as of January 20, 2010, between the Company, certain domestic subsidiaries of the Company that have guaranteed the Company’s obligations under the 2020 Notes, and Wells Fargo Bank, National Association, as the trustee (the “2020 Indenture”). Interest on the 2020 Notes was payable semiannually on January 15 and July 15 of each year. The Company’s obligations under the 2020 Notes were previously guaranteed by certain of the Company’s domestic subsidiaries and secured by a lien on substantially all of the Company’s and the subsidiary guarantors’ assets. However, all guarantees were released upon the discharge of the 2020 Indenture, and, as a result, the Company has ceased presenting condensed consolidated financial statements for the parent company, the former subsidiary guarantors, and non-guarantor subsidiaries effective in the first fiscal quarter of 2015. See Note 16, “Guarantor and Non-Guarantor Subsidiaries,” of the Notes to Condensed Consolidated Financial Statements. | |||||||||||||||||
On January 14, 2015, the Company called the 2020 Notes for redemption at a redemption price equal to 103.438% of the principal amount of the 2020 Notes, and irrevocably deposited $322.2 million with the trustee for the 2020 Notes to discharge the 2020 Indenture. As a result of the deposit and discharge, the guarantees provided by certain of the Company’s domestic subsidiaries, and the liens granted by the Company and the subsidiary guarantors to secure their obligations with respect to the 2020 Notes, were released as of the date of the deposit. The amount deposited with the trustee included $300.0 million to repay the principal amount of the 2020 Notes, $10.3 million representing the difference between the redemption price and the principal amount of the 2020 Notes (“Call Premium”), $10.3 million for accrued interest through January 15, 2015, and $1.6 million of unpaid interest payable up to the redemption date of February 13, 2015. The trustee will use the deposited amounts to redeem the 2020 Notes on February 13, 2015. The Company reported the deposited amounts as “Restricted cash” on the Condensed Consolidated Balance Sheet as of January 31, 2015. | |||||||||||||||||
In accordance with the applicable accounting guidance for debt modification and extinguishment, and for interest costs accounting, the Company expensed the Call Premium, remaining debt issuance costs, and remaining original issue discount relating to the 2020 Notes in the first quarter of fiscal year 2015, which totaled $20.4 million. The Company reported this expense within “Interest expense” on the Condensed Consolidated Statements of Income for the three months ended January 31, 2015. | |||||||||||||||||
As of January 31, 2015, and November 1, 2014, the fair value of the 2020 Notes was approximately $310.1 million and $312.5 million, respectively, which was estimated based on broker trading prices. | |||||||||||||||||
Senior Secured Credit Facility | |||||||||||||||||
In October 2008, the Company entered into a credit agreement for (i) a five-year, $1,100.0 million term loan facility and (ii) a five-year, $125.0 million revolving credit facility, which includes a $25.0 million swing line loan sub-facility and a $25.0 million letter of credit sub-facility (“Senior Secured Credit Facility”). The credit agreement was subsequently amended in January 2010, June 2011, January 2013, October 2013, and April 2014, to, among other things, remove and update certain covenants, reduce interest rates on the term loan facility, reduce interest rates and fees on the revolving credit facility, and extend the maturity date of the revolving credit facility to January 7, 2015. The term loan was prepaid in full, and there were no principal amounts or commitments outstanding under the term loan facility as of either January 31, 2015, or November 1, 2014. | |||||||||||||||||
On January 9, 2015, the Company terminated the Senior Secured Credit Facility. | |||||||||||||||||
Debt Maturities | |||||||||||||||||
As of January 31, 2015, our aggregate debt maturities based on outstanding principal were as follows (in thousands): | |||||||||||||||||
Fiscal Year | Principal | ||||||||||||||||
Balances | |||||||||||||||||
2015 (remaining nine months) | $ | 300,672 | |||||||||||||||
2016 | 291 | ||||||||||||||||
2017 | — | ||||||||||||||||
2018 | — | ||||||||||||||||
2019 | — | ||||||||||||||||
Thereafter | 875,000 | ||||||||||||||||
Total | $ | 1,175,963 | |||||||||||||||
Commitments_And_Contingencies
Commitments And Contingencies | 3 Months Ended | |||||||
Jan. 31, 2015 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||
Commitments And Contingencies | Commitments and Contingencies | |||||||
Product Warranties | ||||||||
The Company’s accrued liability for estimated future warranty costs is included in “Other accrued liabilities” in the accompanying Condensed Consolidated Balance Sheets. The following table summarizes the activity related to the Company’s accrued liability for estimated future warranty costs during the three months ended January 31, 2015, and January 25, 2014, respectively (in thousands): | ||||||||
Accrued Warranty | ||||||||
Three Months Ended | ||||||||
January 31, | January 25, | |||||||
2015 | 2014 | |||||||
Beginning balance | $ | 7,486 | $ | 8,632 | ||||
Liabilities accrued for warranties issued during the period | 1,262 | 866 | ||||||
Warranty claims paid and used during the period | (1,114 | ) | (1,761 | ) | ||||
Changes in liability for pre-existing warranties during the period | (446 | ) | (455 | ) | ||||
Ending balance | $ | 7,188 | $ | 7,282 | ||||
In addition, the Company has defense and indemnification clauses contained within its various customer contracts. As such, the Company indemnifies the parties to whom it sells its products with respect to the Company’s product, alone or potentially in combination with others, infringing upon any patents, trademarks, copyrights, or trade secrets, as well as against bodily injury or damage to real or tangible personal property caused by a defective Company product. As of January 31, 2015, there have been no known events or circumstances that have resulted in a material customer contract-related indemnification liability to the Company. | ||||||||
Manufacturing and Purchase Commitments | ||||||||
Brocade has manufacturing arrangements with contract manufacturers (“CMs”) under which Brocade provides product forecasts and places purchase orders in advance of the scheduled delivery of products to Brocade’s customers. The required lead time for placing orders with the CMs depends on the specific product. Brocade issues purchase orders and the CMs then generate invoices based on prices and payment terms mutually agreed upon and set forth in those purchase orders. Although the purchase orders Brocade places with its CMs are cancellable, the terms of the agreements require Brocade to purchase all inventory components not returnable, usable by, or sold to other customers of the CMs. | ||||||||
As of January 31, 2015, the Company’s aggregate commitment to the CMs for inventory components used in the manufacture of Brocade products was $181.4 million, which the Company expects to utilize during future normal ongoing operations, net of a purchase commitments reserve of $1.1 million, which is reported within “Other accrued liabilities” on the Condensed Consolidated Balance Sheet as of January 31, 2015. The Company’s purchase commitments reserve reflects the Company’s estimate of purchase commitments it does not expect to consume in normal ongoing operations. | ||||||||
Income Taxes | ||||||||
The Company is subject to several ongoing income tax audits. For additional discussion, see Note 13, “Income Taxes,” of the Notes to Condensed Consolidated Financial Statements. The Company believes it has adequate reserves for all open tax years. | ||||||||
Legal Proceedings | ||||||||
From time to time, the Company is subject to various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business, including claims of alleged infringement of patents and/or other intellectual property rights and commercial and employment contract disputes. While the outcome of these matters cannot be predicted with certainty, the Company does not believe that the outcome of any of these matters, individually or in the aggregate, will result in losses that are materially in excess of amounts already accrued by the Company. |
Derivative_Instruments_And_Hed
Derivative Instruments And Hedging Activities | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||
Derivative Instruments And Hedging Activities | Derivative Instruments and Hedging Activities | |||||||||||||||
In the normal course of business, the Company is exposed to fluctuations in interest rates and the exchange rates associated with foreign currencies. The Company’s primary objective for holding derivative financial instruments is to manage foreign currency exchange rate risk. The Company currently does not enter into derivative instruments to manage credit risk. However, the Company manages its exposure to credit risk through its investment policies. The Company generally enters into derivative transactions with high-credit quality counterparties and, by policy, limits the amount of credit exposure to any one counterparty based on its analysis of that counterparty’s relative credit standing. | ||||||||||||||||
The amounts subject to credit risk related to derivative instruments are generally limited to the amounts, if any, by which a counterparty’s obligations exceed the Company’s obligations with that counterparty. | ||||||||||||||||
Foreign Currency Exchange Rate Risk | ||||||||||||||||
A majority of the Company’s revenue, expense, and capital purchasing activities are transacted in U.S. dollars. However, the Company is exposed to foreign currency exchange rate risk inherent in conducting business globally in numerous currencies. The Company is primarily exposed to foreign currency fluctuations related to operating expenses denominated in currencies other than the U.S. dollar, of which the most significant to its operations for the three months ended January 31, 2015, and January 25, 2014, were the euro, the British pound, the Indian rupee, the Chinese yuan, the Japanese yen, the Singapore dollar, and the Swiss franc. The Company has established a foreign currency risk management program to protect against the volatility of future cash flows caused by changes in foreign currency exchange rates. This program reduces, but does not eliminate, the impact of foreign currency exchange rate movements. | ||||||||||||||||
The Company utilizes a rolling hedge strategy for the majority of its foreign currency derivative instruments with cash flow hedge accounting designation that hedges exposures to the variability in the U.S. dollar equivalent of anticipated non-U.S.-dollar-denominated cash flows. The Company’s foreign currency risk management program includes foreign currency derivatives with a cash flow hedge accounting designation that utilizes foreign currency forward and option contracts to hedge exposures to the variability in the U.S. dollar equivalent of anticipated non-U.S.-dollar-denominated cash flows. These instruments generally have a maturity of less than 15 months. For these derivatives, the Company reports the after-tax gain or loss from the effective portion of the hedge as a component of accumulated other comprehensive loss in stockholders’ equity and reclassifies it into earnings in the same period in which the hedged transaction affects earnings. The tax effect allocated to cash flow hedge-related components of other comprehensive income was not significant for the three months ended January 31, 2015, and January 25, 2014. | ||||||||||||||||
Ineffective cash flow hedges are included in the Company’s net income as part of “Interest and other income (loss), net.” The amount recorded on ineffective cash flow hedges was not significant for the three months ended January 31, 2015, and January 25, 2014, respectively. | ||||||||||||||||
Net gains (losses) relating to the effective portion of foreign currency derivatives recorded in the Condensed Consolidated Statements of Income are as follows (in thousands): | ||||||||||||||||
Three Months Ended | ||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||
Cost of revenues | $ | (136 | ) | $ | 72 | |||||||||||
Research and development | (35 | ) | (300 | ) | ||||||||||||
Sales and marketing | (454 | ) | 239 | |||||||||||||
General and administrative | (58 | ) | 22 | |||||||||||||
Total | $ | (683 | ) | $ | 33 | |||||||||||
Alternatively, the Company may choose not to hedge the foreign currency risk associated with its foreign currency exposures if the Company believes such exposure acts as a natural foreign currency hedge for other offsetting amounts denominated in the same currency or if the currency is difficult or too expensive to hedge. The net foreign currency exchange gains and losses recorded as part of “Interest income and other loss, net” were losses of $1.0 million and $0.1 million for the three months ended January 31, 2015, and the three months ended January 25, 2014, respectively. | ||||||||||||||||
As of January 31, 2015, the Company had gross unrealized loss positions of $3.3 million and gross unrealized gain positions of $0.1 million included in “Other accrued liabilities” and “Prepaid expenses and other current assets,” respectively. | ||||||||||||||||
Volume of Derivative Activity | ||||||||||||||||
Total gross notional amounts, presented by currency, are as follows (in thousands): | ||||||||||||||||
Derivatives Designated | Derivatives Not Designated | |||||||||||||||
as Hedging Instruments | as Hedging Instruments | |||||||||||||||
In U.S. dollars | As of January 31, 2015 | As of November 1, 2014 | As of January 31, 2015 | As of November 1, 2014 | ||||||||||||
Euro | $ | 9,741 | $ | 14,404 | $ | 12,985 | $ | 19,200 | ||||||||
British pound | 7,887 | 11,168 | 10,517 | 14,891 | ||||||||||||
Indian rupee | 14,510 | 19,413 | — | — | ||||||||||||
Chinese yuan | 7,638 | 10,406 | — | — | ||||||||||||
Singapore dollar | 6,583 | 9,242 | — | — | ||||||||||||
Japanese yen | 6,342 | 8,856 | — | — | ||||||||||||
Swiss franc | 5,863 | 7,468 | — | — | ||||||||||||
Total | $ | 58,564 | $ | 80,957 | $ | 23,502 | $ | 34,091 | ||||||||
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | |||||||||||||
Jan. 31, 2015 | ||||||||||||||
Share-based Compensation, Allocation and Classification in Financial Statements [Abstract] | ||||||||||||||
Stockholders' Equity and Stock-Based Compensation | Stock-Based Compensation | |||||||||||||
Stock-based compensation expense, net of estimated forfeitures, was included in the following line items of the Condensed Consolidated Statements of Income as follows (in thousands): | ||||||||||||||
Three Months Ended | ||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||
Cost of revenues | $ | 3,816 | $ | 3,142 | ||||||||||
Research and development | 4,933 | 4,336 | ||||||||||||
Sales and marketing | 9,843 | 6,765 | ||||||||||||
General and administrative | 5,490 | 4,345 | ||||||||||||
Total stock-based compensation | $ | 24,082 | $ | 18,588 | ||||||||||
The following table presents stock-based compensation expense, net of estimated forfeitures, by grant type (in thousands): | ||||||||||||||
Three Months Ended | ||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||
Stock options | $ | 1,356 | $ | 1,281 | ||||||||||
Restricted stock units, including stock units with market conditions (altogether “RSUs”) | 17,934 | 14,584 | ||||||||||||
Employee stock purchase plan (“ESPP”) | 4,792 | 2,723 | ||||||||||||
Total stock-based compensation | $ | 24,082 | $ | 18,588 | ||||||||||
The following table presents the unrecognized compensation expense, net of estimated forfeitures, of the Company’s equity compensation plans as of January 31, 2015, which is expected to be recognized over the following weighted-average periods (in thousands, except for the weighted-average period): | ||||||||||||||
Unrecognized | Weighted- | |||||||||||||
Compensation | Average Period | |||||||||||||
Expense | (in years) | |||||||||||||
Stock options | $ | 5,791 | 1.41 | |||||||||||
RSUs | $ | 130,468 | 2.04 | |||||||||||
ESPP | $ | 12,005 | 0.95 | |||||||||||
The following table presents details on grants made by the Company for the following periods: | ||||||||||||||
Three Months Ended | ||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||
Granted | Weighted-Average | Granted | Weighted-Average | |||||||||||
(in thousands) | Grant Date Fair Value | (in thousands) | Grant Date Fair Value | |||||||||||
Stock options | 1,117 | $ | 3.09 | 1,270 | $ | 3.25 | ||||||||
RSUs | 3,641 | $ | 10.87 | 2,885 | $ | 10.75 | ||||||||
The total intrinsic value of stock options exercised for the three months ended January 31, 2015, and January 25, 2014, was $1.0 million and $2.1 million, respectively. |
Stockholders_Equity
Stockholders' Equity | 3 Months Ended | |||||||||||||||||||||||
Jan. 31, 2015 | ||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||
Stockholders' Equity | Stockholders’ Equity | |||||||||||||||||||||||
Dividends | ||||||||||||||||||||||||
During the three months ended January 31, 2015, the Company’s Board of Directors declared the following dividends (in thousands, except per share amounts): | ||||||||||||||||||||||||
Declaration Date | Dividend per Share | Record Date | Total Amount Paid | Payment Date | ||||||||||||||||||||
November 24, 2014 | $ | 0.035 | December 10, 2014 | $ | 15,106 | January 2, 2015 | ||||||||||||||||||
No dividends were declared or paid by the Company during the three months ended January 25, 2014. Future dividend payments are subject to review and approval by the Company’s Board of Directors. | ||||||||||||||||||||||||
Convertible Note Hedge and Warrant Related to the Convertible Senior Unsecured Notes | ||||||||||||||||||||||||
In connection with the issuance of the 2020 Convertible Notes, the Company entered into convertible note hedge and warrant transactions with certain financial institutions with respect to its common stock. See Note 8, “Borrowings,” of the Notes to Condensed Consolidated Financial Statements for further discussion. | ||||||||||||||||||||||||
Accumulated Other Comprehensive Loss | ||||||||||||||||||||||||
The tax effects allocated to each component of other comprehensive income (loss) for the three months ended January 31, 2015, and January 25, 2014, are as follows (in thousands): | ||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||||||||||
Before-Tax Amount | Tax (Expense) or Benefit | Net-of-Tax Amount | Before-Tax Amount | Tax Benefit | Net-of-Tax Amount | |||||||||||||||||||
Unrealized gains (losses) on cash flow hedges: | ||||||||||||||||||||||||
Change in unrealized gains and losses, foreign exchange contracts | $ | (2,179 | ) | $ | 405 | $ | (1,774 | ) | $ | (1,021 | ) | $ | 97 | $ | (924 | ) | ||||||||
Net gains and losses reclassified into earnings, foreign exchange contracts (1) | 683 | (80 | ) | 603 | (33 | ) | 2 | (31 | ) | |||||||||||||||
Net unrealized gains (losses) on cash flow hedges | (1,496 | ) | 325 | (1,171 | ) | (1,054 | ) | 99 | (955 | ) | ||||||||||||||
Foreign currency translation adjustments | (4,221 | ) | — | (4,221 | ) | (823 | ) | — | (823 | ) | ||||||||||||||
Total other comprehensive loss | $ | (5,717 | ) | $ | 325 | $ | (5,392 | ) | $ | (1,877 | ) | $ | 99 | $ | (1,778 | ) | ||||||||
-1 | For Condensed Consolidated Statements of Income classification of amounts reclassified from accumulated other comprehensive loss, see Note 10, “Derivative Instruments and Hedging Activities,” of the Notes to Condensed Consolidated Financial Statements. | |||||||||||||||||||||||
The changes in accumulated other comprehensive loss by component, net of tax, for the three months ended January 31, 2015, and January 25, 2014, are as follows (in thousands): | ||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||||||||||
Gains (Losses) on Cash Flow Hedges | Foreign Currency Translation Adjustments | Total Accumulated Other Comprehensive Loss | Gains (Losses) on Cash Flow Hedges | Foreign Currency Translation Adjustments | Total Accumulated Other Comprehensive Loss | |||||||||||||||||||
Beginning balance | $ | (1,907 | ) | $ | (16,907 | ) | $ | (18,814 | ) | $ | 267 | $ | (13,711 | ) | $ | (13,444 | ) | |||||||
Change in unrealized gains and losses | (1,774 | ) | (4,221 | ) | (5,995 | ) | (924 | ) | (823 | ) | (1,747 | ) | ||||||||||||
Net gains and losses reclassified into earnings | 603 | — | 603 | (31 | ) | — | (31 | ) | ||||||||||||||||
Net current-period other comprehensive loss | (1,171 | ) | (4,221 | ) | (5,392 | ) | (955 | ) | (823 | ) | (1,778 | ) | ||||||||||||
Ending balance | $ | (3,078 | ) | $ | (21,128 | ) | $ | (24,206 | ) | $ | (688 | ) | $ | (14,534 | ) | $ | (15,222 | ) |
Income_Taxes
Income Taxes | 3 Months Ended |
Jan. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes |
The effective tax rate for the three months ended January 31, 2015, differs from tax computed at the U.S. federal statutory tax rate of 35% due to state taxes, the effect of earnings in foreign jurisdictions which are subject to tax at lower tax rates, nondeductible stock-based compensation expense, and adjustments to unrecognized tax benefits. | |
The lower effective tax rate for the three months ended January 31, 2015, compared with the same period in fiscal year 2014, was primarily due to discrete benefits from an increase in the federal research and development tax credit that was reinstated in December 2014 and made retroactive for calendar year 2014. | |
The total amount of net unrecognized tax benefits of $81.0 million as of January 31, 2015, would affect the Company’s effective tax rate, if recognized. The timing of the closure of audits is highly uncertain and it is reasonably possible that the balance of unrecognized tax benefits could change during the remainder of fiscal year 2015. | |
The IRS and other tax authorities regularly examine the Company’s income tax returns. In October 2014, the IRS issued a Revenue Agent’s Report related to its field examination of the Company’s federal income tax returns for fiscal years 2009 and 2010. The IRS is contesting the Company’s transfer pricing with its foreign subsidiaries. In November 2014, the Company filed a protest to challenge the proposed adjustment and to move the issue to the Office of Appeals. In addition, in October 2014, the Geneva Tax Administration issued its final assessments for fiscal years 2003 to 2012 disputing certain of the Company’s transfer pricing arrangements. In November 2014, the Company filed a protest to challenge the final assessments. The Company believes that reserves for unrecognized tax benefits are adequate for all open tax years. The timing of income tax examinations, as well as the amounts and timing of related settlements, if any, are highly uncertain. Before the end of fiscal year 2015, it is reasonably possible that either certain audits will conclude or the statute of limitations relating to certain income tax examination periods will expire, or both. Taking into consideration the inherent uncertainty as to settlement terms, the timing of payments, and the impact of such settlements on other uncertain tax positions, the Company estimates the range of potential decreases in underlying uncertain tax positions is between $0 million and $4 million in the next 12 months. |
Segment_Information
Segment Information | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||
Segment Information | Segment Information | |||||||||||||||
Operating segments are defined as components of an enterprise for which separate financial information is available that is evaluated regularly by the Chief Operating Decision Maker (“CODM”), or decision-making group, in deciding how to allocate resources and in assessing performance. Financial decisions and the allocation of resources are based on the information from the Company’s internal management reporting system. Currently, the Company’s CODM is its Chief Executive Officer. | ||||||||||||||||
Brocade is organized into three operating segments, each of which is an individually reportable segment: SAN Products, IP Networking Products, and Global Services. These reportable segments are organized principally by product category. | ||||||||||||||||
At this time, the Company does not track its operating expenses by operating segments because management does not include this information in its measurement of the performance of the operating segments. The Company also does not track all of its assets by operating segments. The majority of the Company’s assets as of January 31, 2015, were attributable to its U.S. operations. | ||||||||||||||||
Summarized financial information by reportable segment for the three months ended January 31, 2015, and January 25, 2014, based on the internal management reporting system, is as follows (in thousands): | ||||||||||||||||
SAN Products | IP Networking Products | Global Services | Total | |||||||||||||
Three months ended January 31, 2015 | ||||||||||||||||
Net revenues | $ | 353,399 | $ | 132,839 | $ | 90,001 | $ | 576,239 | ||||||||
Cost of revenues | 85,725 | 64,201 | 36,630 | 186,556 | ||||||||||||
Gross margin | $ | 267,674 | $ | 68,638 | $ | 53,371 | $ | 389,683 | ||||||||
Three months ended January 25, 2014 | ||||||||||||||||
Net revenues | $ | 355,456 | $ | 119,749 | $ | 89,330 | $ | 564,535 | ||||||||
Cost of revenues | 92,941 | 60,686 | 38,238 | 191,865 | ||||||||||||
Gross margin | $ | 262,515 | $ | 59,063 | $ | 51,092 | $ | 372,670 | ||||||||
Net_Income_Per_Share
Net Income Per Share | 3 Months Ended | |||||||
Jan. 31, 2015 | ||||||||
Earnings Per Share [Abstract] | ||||||||
Net Income (Loss) Per Share | Net Income per Share | |||||||
The following table presents the calculation of basic and diluted net income per share (in thousands, except per share amounts): | ||||||||
Three Months Ended | ||||||||
January 31, | January 25, | |||||||
2015 | 2014 | |||||||
Basic net income per share | ||||||||
Net income | $ | 87,267 | $ | 80,884 | ||||
Weighted-average shares used in computing basic net income per share | 428,536 | 440,573 | ||||||
Basic net income per share | $ | 0.2 | $ | 0.18 | ||||
Diluted net income per share | ||||||||
Net income | $ | 87,267 | $ | 80,884 | ||||
Weighted-average shares used in computing basic net income per share | 428,536 | 440,573 | ||||||
Dilutive potential common shares in the form of stock options | 1,734 | 2,620 | ||||||
Dilutive potential common shares in the form of other share-based awards | 8,886 | 10,356 | ||||||
Weighted-average shares used in computing diluted net income per share | 439,156 | 453,549 | ||||||
Diluted net income per share | $ | 0.2 | $ | 0.18 | ||||
Antidilutive potential common shares in the form of: (1) | ||||||||
Warrants issued in conjunction with the 2020 Convertible Notes (2) | 7,140 | — | ||||||
Stock options | 577 | 3,015 | ||||||
Other share-based awards | — | 462 | ||||||
(1) | These amounts are excluded from the computation of diluted net income per share. | |||||||
(2) | In connection with the issuance of the 2020 Convertible Notes, the Company entered into convertible note hedge and warrant transactions as described in Note 8, “Borrowings.” The 2020 Convertible Notes have no impact on diluted earnings per share until the average quarterly price of the Company’s common stock exceeds the conversion price of $15.93 per share. If the common stock price exceeds this conversion price, prior to conversion, the Company will calculate the effect of the additional shares that may be issued using the treasury stock method. If the average price of the Company’s common stock exceeds $20.65 per share for a quarterly period, the Company’s weighted-average shares used in computing diluted net income per share will be impacted by the effect of the additional potential shares that may be issued related to the warrants using the treasury stock method. The convertible note hedge is not considered for purposes of the diluted earnings per share calculation, as its effect would be antidilutive. |
Guarantor_And_NonGuarantor_Sub
Guarantor And Non-Guarantor Subsidiaries | 3 Months Ended |
Jan. 31, 2015 | |
Guarantor And Non-Guarantor Subsidiaries [Abstract] | |
Guarantor And Non-Guarantor Subsidiaries | Guarantor and Non-Guarantor Subsidiaries |
On January 20, 2010, the Company issued $300.0 million in aggregate principal amount of the 6.625% senior secured notes due 2018 (the “2018 Notes”) and $300.0 million in aggregate principal amount of the 2020 Notes (together with the 2018 Notes, the “Senior Secured Notes”) pursuant to separate indentures between the Company, certain domestic subsidiaries of the Company, and Wells Fargo Bank, National Association, as the trustee (the “2020 Indenture” and “2018 Indenture,” respectively). In addition, on January 22, 2013, the Company issued $300.0 million in aggregate principal amount of the 2023 Notes. The Company’s obligations under the Senior Secured Notes and the 2023 Notes were previously guaranteed by certain of the Company’s domestic subsidiaries (the “Subsidiary Guarantors”). Each of the Subsidiary Guarantors is 100% owned by the Company and all guarantees were joint and several. Neither the Senior Secured Notes nor the 2023 Notes were guaranteed by certain of the Company’s domestic subsidiaries or any of the Company’s foreign subsidiaries (the “Non-Guarantor Subsidiaries”). | |
The Company determined that the circumstances under which the subsidiary guarantees may be released were customary under applicable SEC guidance, and, as such, the Company previously provided consolidated financial statements in reliance on Item 3-10 of Regulation S-X. | |
The guarantees of the 2018 Notes and 2020 Notes were released on January 22, 2013, and January 14, 2015, respectively, upon the discharge of the 2018 Indenture and 2020 Indenture. The guarantees of the 2023 Notes were released on January 14, 2015, upon termination of the Senior Secured Credit Facility and discharge of the 2020 Indenture. | |
As a result, all guarantees have been released prior to January 31, 2015, and the Company has ceased presenting condensed consolidated financial statements for the parent company, the former Subsidiary Guarantors, and Non-Guarantor Subsidiaries effective in the first fiscal quarter in 2015. |
Subsequent_Events_Subsequent_E
Subsequent Events Subsequent Events | 3 Months Ended |
Jan. 31, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | 17. Subsequent Events |
During the first quarter of fiscal year 2015, the Company irrevocably deposited $311.9 million with the trustee for redemption of the 2020 Notes as described in Note 8, “Borrowings,” of the Notes to Condensed Consolidated Financial Statements. On February 13, 2015, the trustee redeemed the 2020 Notes using the deposited amount (less the amount used for the January 15, 2015 interest payment), extinguishing the Company’s $300.0 million liability in relation to the principal amount of the 2020 Notes. |
Basis_Of_Presentation_Policies
Basis Of Presentation (Policies) | 3 Months Ended |
Jan. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fiscal Period Policy | The Company’s fiscal year is a 52- or 53-week period ending on the last Saturday in October or the first Saturday in November, respectively. Fiscal year 2015 is a 52-week fiscal year and fiscal year 2014 was a 53-week fiscal year. The second quarter of fiscal year 2014 was a 14-week quarter, which was one week longer than a typical quarter. |
Consolidation Policy | The Condensed Consolidated Financial Statements include the accounts of Brocade and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. |
Use of Estimates in Preparation of Condensed Consolidated Financial Statements | Use of Estimates in Preparation of Condensed Consolidated Financial Statements |
The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates and judgments that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, revenue recognition, sales allowances and programs, allowance for doubtful accounts, stock-based compensation, purchase price allocations, warranty obligations, inventory valuation and purchase commitments, restructuring costs, incentive compensation, facilities lease losses, impairment of goodwill and intangible assets, litigation, and income taxes. Actual results may differ materially from these estimates. |
Recovered_Sheet1
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Jan. 31, 2015 | |
Accounting Policies [Abstract] | |
New Accounting Pronouncements, Policy | New Accounting Pronouncements or Updates Recently Adopted |
In March 2013, the Financial Accounting Standards Board (“FASB”) issued an update to Accounting Standards Codification (“ASC”) 830, Foreign Currency Matters: Parent’s Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. Under this update, an entity is required to release any cumulative translation adjustment into net income when the entity ceases to have a controlling financial interest resulting from the complete or substantially complete liquidation of a subsidiary or group of assets within a foreign entity. This update should be applied prospectively. The Company adopted this update in the first quarter of fiscal year 2015. There was no material impact on its financial position, results of operations, or cash flows. | |
Recent Accounting Pronouncements or Updates That Are Not Yet Effective | |
In April 2014, the FASB issued an update to ASC 205, Presentation of Financial Statements, and ASC 360, Property, Plant, and Equipment: Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. Under this update, a discontinued operation may include a component of an entity or a group of components of an entity, or a business or nonprofit activity. Only those disposals of components of an entity that represent a strategic shift that has, or will have, a major effect on an entity’s operations and financial results will be reported as discontinued operations in the financial statements. This update should be applied prospectively and will be adopted by the Company in the first quarter of fiscal year 2016. Early adoption is permitted, but only for disposals that have not been reported in financial statements previously issued. The Company is currently evaluating the impact of this update on its consolidated financial statements. | |
In May 2014, the FASB issued an update to ASC 606, Revenue from Contracts with Customers, that will supersede virtually all existing revenue guidance. Under this update, an entity is required to recognize revenue upon transfer of promised goods or services to customers, in an amount that reflects the expected consideration received in exchange for those goods or services. As such, an entity will need to use more judgment and make more estimates than under the current guidance. This update should be applied retrospectively either to each prior reporting period presented in the financial statements, or only to the most current reporting period presented in the financial statements with a cumulative effect adjustment recorded in the retained earnings. This update becomes effective and will be adopted by the Company in the first quarter of fiscal year 2018. Early adoption is not permitted. The Company is currently evaluating the impact of this update on its consolidated financial statements. |
Goodwill_And_Intangible_Assets1
Goodwill And Intangible Assets Goodwill And Intangible Assets (Policies) | 3 Months Ended | |
Jan. 31, 2015 | ||
Accounting Policies [Abstract] | ||
Goodwill and Intangible Assets, Intangible Assets, Indefinite-Lived, Policy | Acquired in-process research and development (“IPR&D”) is an intangible asset accounted for as an indefinite-lived asset until the completion or abandonment of the associated research and development effort. If the research and development effort associated with the IPR&D is successfully completed, then the IPR&D intangible asset will be amortized over its estimated useful life to be determined at the date the effort is completed. | |
Goodwill and Intangible Assets, Goodwill Policy | The Company conducts the goodwill impairment test annually, as of the first day of the second fiscal quarter, and whenever events occur or facts and circumstances indicate it is more likely than not that the fair value of a reporting unit has fallen below its carrying amount. For the annual goodwill impairment test, the Company uses the income approach, the market approach, or a combination thereof to determine each reporting unit’s fair value. The income approach provides an estimate of fair value based on discounted expected future cash flows (“DCF”). The market approach provides an estimate of fair value applying various observable market-based multiples to the reporting unit’s operating results and then applying an appropriate control premium. For the fiscal year 2014 annual goodwill impairment test, the Company used a combination of approaches to estimate each reporting unit’s fair value. The Company believed that, at the time of the impairment testing performed in the second fiscal quarter of 2014, the income approach and the market approach were equally representative of a reporting unit’s fair value. | |
Determining the fair value of a reporting unit or an intangible asset requires judgment and involves the use of significant estimates and assumptions. The Company based its fair value estimates on assumptions it believes to be reasonable, but inherently uncertain. Estimates and assumptions with respect to the determination of the fair value of its reporting units using the income approach include, among other inputs: | ||
• | The Company’s operating forecasts; | |
• | Revenue growth rates; and | |
• | Risk-commensurate discount rates and costs of capital. | |
The Company’s estimates of revenues and costs are based on historical data, various internal estimates, and a variety of external sources, and are developed as part of our regular long-range planning process. The control premium used in market or combined approaches is determined by considering control premiums offered as part of the acquisitions that have occurred in market segments that are comparable with the Company’s reporting units. | ||
Goodwill and Intangible Assets, Intangible Assets, Policy | Intangible assets other than goodwill are amortized on a straight-line basis over the following estimated remaining useful lives, unless the Company has determined these lives to be indefinite. |
Fair_Value_Measurements_Fair_V
Fair Value Measurements Fair Value Measurements (Policies) | 3 Months Ended |
Jan. 31, 2015 | |
Accounting Policies [Abstract] | |
Fair Value Transfer Policy | During the three months ended January 31, 2015, the Company had no transfers between levels of the fair value hierarchy of its assets and liabilities measured at fair value. |
Derivative_Instruments_And_Hed1
Derivative Instruments And Hedging Activities Derivative Instruments And Hedging Activities (Policies) | 3 Months Ended |
Jan. 31, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives, Methods of Accounting, Hedging Derivatives | A majority of the Company’s revenue, expense, and capital purchasing activities are transacted in U.S. dollars. However, the Company is exposed to foreign currency exchange rate risk inherent in conducting business globally in numerous currencies. The Company is primarily exposed to foreign currency fluctuations related to operating expenses denominated in currencies other than the U.S. dollar, of which the most significant to its operations for the three months ended January 31, 2015, and January 25, 2014, were the euro, the British pound, the Indian rupee, the Chinese yuan, the Japanese yen, the Singapore dollar, and the Swiss franc. The Company has established a foreign currency risk management program to protect against the volatility of future cash flows caused by changes in foreign currency exchange rates. This program reduces, but does not eliminate, the impact of foreign currency exchange rate movements. |
The Company utilizes a rolling hedge strategy for the majority of its foreign currency derivative instruments with cash flow hedge accounting designation that hedges exposures to the variability in the U.S. dollar equivalent of anticipated non-U.S.-dollar-denominated cash flows. The Company’s foreign currency risk management program includes foreign currency derivatives with a cash flow hedge accounting designation that utilizes foreign currency forward and option contracts to hedge exposures to the variability in the U.S. dollar equivalent of anticipated non-U.S.-dollar-denominated cash flows. These instruments generally have a maturity of less than 15 months. For these derivatives, the Company reports the after-tax gain or loss from the effective portion of the hedge as a component of accumulated other comprehensive loss in stockholders’ equity and reclassifies it into earnings in the same period in which the hedged transaction affects earnings. The tax effect allocated to cash flow hedge-related components of other comprehensive income was not significant for the three months ended January 31, 2015, and January 25, 2014. | |
Ineffective cash flow hedges are included in the Company’s net income as part of “Interest and other income (loss), net.” The amount recorded on ineffective cash flow hedges was not significant for the three months ended January 31, 2015, and January 25, 2014, respectively. |
Goodwill_And_Intangible_Assets2
Goodwill And Intangible Assets (Tables) | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | ||||||||||||||||
Schedule of Intangible Assets and Goodwill | The following table presents a summary of the net carrying value of the Company’s intangible assets (in thousands): | |||||||||||||||
January 31, | November 1, | |||||||||||||||
2015 | 2014 | |||||||||||||||
Indefinite-lived intangible assets | ||||||||||||||||
Goodwill | $ | 1,567,718 | $ | 1,567,723 | ||||||||||||
In-process research and development (1) | 15,110 | 15,110 | ||||||||||||||
Finite-lived intangible assets | ||||||||||||||||
Total intangible assets subject to amortization (2) | 18,523 | 11,548 | ||||||||||||||
Total intangible assets | $ | 1,601,351 | $ | 1,594,381 | ||||||||||||
-1 | Acquired in-process research and development (“IPR&D”) is an intangible asset accounted for as an indefinite-lived asset until the completion or abandonment of the associated research and development effort. If the research and development effort associated with the IPR&D is successfully completed, then the IPR&D intangible asset will be amortized over its estimated useful life to be determined at the date the effort is completed. The development effort on the IPR&D intangible asset is expected to be completed by the first half of fiscal year 2016. | |||||||||||||||
(2) | During the three months ended January 31, 2015, the Company purchased a perpetual, non-exclusive license to certain patents for $7.8 million. | |||||||||||||||
Schedule Of Goodwill Activity By Reportable Segment | The following table summarizes goodwill activity by reportable segment for the three months ended January 31, 2015 (in thousands): | |||||||||||||||
SAN | Internet Protocol (“IP”) Networking Products | Global Services | Total | |||||||||||||
Products | ||||||||||||||||
Balance at November 1, 2014 | ||||||||||||||||
Goodwill | $ | 176,346 | $ | 1,365,175 | $ | 155,416 | $ | 1,696,937 | ||||||||
Accumulated impairment losses | — | (129,214 | ) | — | (129,214 | ) | ||||||||||
176,346 | 1,235,961 | 155,416 | 1,567,723 | |||||||||||||
Tax and other adjustments during the three | (5 | ) | — | — | (5 | ) | ||||||||||
months ended January 31, 2015 (1) | ||||||||||||||||
Balance at January 31, 2015 | ||||||||||||||||
Goodwill | 176,341 | 1,365,175 | 155,416 | 1,696,932 | ||||||||||||
Accumulated impairment losses | — | (129,214 | ) | — | (129,214 | ) | ||||||||||
$ | 176,341 | $ | 1,235,961 | $ | 155,416 | $ | 1,567,718 | |||||||||
(1) | The goodwill adjustments during the three months ended January 31, 2015, were primarily a result of tax benefits from the exercise of stock awards of acquired companies. | |||||||||||||||
Schedule Of Finite-Lived Intangible Assets | The following tables present details of the Company’s finite-lived intangible assets (in thousands, except for weighted-average remaining useful life): | |||||||||||||||
January 31, 2015 | Gross | Accumulated | Net | Weighted- | ||||||||||||
Carrying | Amortization | Carrying | Average | |||||||||||||
Value | Value | Remaining | ||||||||||||||
Useful Life | ||||||||||||||||
(in years) | ||||||||||||||||
Trade name | $ | 590 | $ | 262 | $ | 328 | 2.8 | |||||||||
Core/developed technology | 12,080 | 2,602 | 9,478 | 4.07 | ||||||||||||
Patent license (1) | 7,750 | — | 7,750 | 18.74 | ||||||||||||
Customer relationships | 1,080 | 479 | 601 | 2.76 | ||||||||||||
Non-compete agreements | 810 | 444 | 366 | 1.76 | ||||||||||||
Total intangible assets | $ | 22,310 | $ | 3,787 | $ | 18,523 | 10.1 | |||||||||
November 1, 2014 | Gross | Accumulated | Net | Weighted- | ||||||||||||
Carrying | Amortization | Carrying | Average | |||||||||||||
Value | Value | Remaining | ||||||||||||||
Useful Life | ||||||||||||||||
(in years) | ||||||||||||||||
Trade name | $ | 590 | $ | 227 | $ | 363 | 3 | |||||||||
Core/developed technology | 12,080 | 1,964 | 10,116 | 4.3 | ||||||||||||
Customer relationships | 1,080 | 427 | 653 | 3.01 | ||||||||||||
Non-compete agreements | 810 | 394 | 416 | 2.01 | ||||||||||||
Total intangible assets | $ | 14,560 | $ | 3,012 | $ | 11,548 | 4.1 | |||||||||
(1) | The patent license was assigned an estimated useful life that reflects the Company’s consumption of the expected defensive benefits related to this intangible asset. The method of amortization for the patent license reflects the Company’s estimate of the pattern in which these expected defensive benefits will be consumed or otherwise used up by the Company, and is primarily driven by a mix of expiration patterns of the individual patents included in the license. | |||||||||||||||
Schedule Of Amortization Of Intangible Assets Included On Consolidated Statements Of Operations | The following table presents the amortization of finite-lived intangible assets included in the Condensed Consolidated Statements of Income (in thousands): | |||||||||||||||
Three Months Ended | ||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||
Cost of revenues | $ | 637 | $ | 6,462 | ||||||||||||
Operating expenses | 138 | 9,883 | ||||||||||||||
Total | $ | 775 | $ | 16,345 | ||||||||||||
Schedule Of Estimated Future Amortization Of Intangible Assets | The following table presents the estimated future amortization of finite-lived intangible assets as of January 31, 2015 (in thousands): | |||||||||||||||
Fiscal Year | Estimated | |||||||||||||||
Future | ||||||||||||||||
Amortization | ||||||||||||||||
2015 (remaining nine months) | $ | 3,173 | ||||||||||||||
2016 | 3,875 | |||||||||||||||
2017 | 3,476 | |||||||||||||||
2018 | 3,139 | |||||||||||||||
2019 | 1,680 | |||||||||||||||
Thereafter | 3,180 | |||||||||||||||
Total | $ | 18,523 | ||||||||||||||
Balance_Sheet_Details_Tables
Balance Sheet Details (Tables) | 3 Months Ended | |||||||
Jan. 31, 2015 | ||||||||
Balance Sheet Details [Abstract] | ||||||||
Schedule of Inventory | ||||||||
January 31, | November 1, | |||||||
2015 | 2014 | |||||||
Inventories: | ||||||||
Raw materials | $ | 11,592 | $ | 10,491 | ||||
Finished goods | 28,683 | 28,227 | ||||||
Inventories, net | $ | 40,275 | $ | 38,718 | ||||
Schedule of Property, Plant and Equipment | ||||||||
January 31, | November 1, | |||||||
2015 | 2014 | |||||||
Property and equipment: | ||||||||
Computer equipment | $ | 13,569 | $ | 13,679 | ||||
Software | 64,266 | 62,919 | ||||||
Engineering and other equipment (1) | 385,394 | 383,412 | ||||||
Furniture and fixtures (1) | 28,646 | 29,053 | ||||||
Leasehold improvements | 24,651 | 23,607 | ||||||
Land and building | 384,426 | 384,659 | ||||||
Subtotal | 900,952 | 897,329 | ||||||
Less: Accumulated depreciation and amortization (1), (2) | (458,308 | ) | (451,896 | ) | ||||
Property and equipment, net | $ | 442,644 | $ | 445,433 | ||||
(1) | Engineering and other equipment, furniture and fixtures, and accumulated depreciation and amortization include the following amounts under capital leases as of January 31, 2015, and November 1, 2014, respectively (in thousands): | |||||||
January 31, | November 1, | |||||||
2015 | 2014 | |||||||
Cost | $ | 11,925 | $ | 11,925 | ||||
Accumulated depreciation | (7,669 | ) | (7,209 | ) | ||||
Property and equipment, net, under capital leases | $ | 4,256 | $ | 4,716 | ||||
(2) | The following table presents the depreciation of property and equipment included on the Condensed Consolidated Statements of Income (in thousands): | |||||||
Three Months Ended | ||||||||
January 31, | January 25, | |||||||
2015 | 2014 | |||||||
Depreciation expense | $ | 18,800 | $ | 22,409 | ||||
Schedule of Capital Leased Assets | Engineering and other equipment, furniture and fixtures, and accumulated depreciation and amortization include the following amounts under capital leases as of January 31, 2015, and November 1, 2014, respectively (in thousands): | |||||||
January 31, | November 1, | |||||||
2015 | 2014 | |||||||
Cost | $ | 11,925 | $ | 11,925 | ||||
Accumulated depreciation | (7,669 | ) | (7,209 | ) | ||||
Property and equipment, net, under capital leases | $ | 4,256 | $ | 4,716 | ||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||
Schedule Of Assets And Liabilities Measured At Fair Value | Assets and liabilities measured and recorded at fair value on a recurring basis as of January 31, 2015, were as follows (in thousands): | |||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | |||||||||||||
January 31, 2015 | Active Markets | Observable | Unobservable | |||||||||||||
for Identical | Inputs | Inputs | ||||||||||||||
Instruments | (Level 2) | (Level 3) | ||||||||||||||
(Level 1) | ||||||||||||||||
Assets: | ||||||||||||||||
Money market funds (1) | $ | 1,113,605 | $ | 1,113,605 | $ | — | $ | — | ||||||||
Derivative assets | 108 | — | 108 | — | ||||||||||||
Total assets measured at fair value | $ | 1,113,713 | $ | 1,113,605 | $ | 108 | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Derivative liabilities | $ | 3,310 | $ | — | $ | 3,310 | $ | — | ||||||||
Total liabilities measured at fair value | $ | 3,310 | $ | — | $ | 3,310 | $ | — | ||||||||
(1) | Money market funds are reported within “Cash and cash equivalents” on the Condensed Consolidated Balance Sheets. | |||||||||||||||
Assets and liabilities measured and recorded at fair value on a recurring basis as of November 1, 2014, were as follows (in thousands): | ||||||||||||||||
Fair Value Measurements Using | ||||||||||||||||
Balance as of | Quoted Prices in | Significant Other | Significant | |||||||||||||
November 1, 2014 | Active Markets | Observable | Unobservable | |||||||||||||
for Identical | Inputs | Inputs | ||||||||||||||
Instruments | (Level 2) | (Level 3) | ||||||||||||||
(Level 1) | ||||||||||||||||
Assets: | ||||||||||||||||
Money market funds (1) | $ | 1,009,283 | $ | 1,009,283 | $ | — | $ | — | ||||||||
Derivative assets | 99 | — | 99 | — | ||||||||||||
Total assets measured at fair value | $ | 1,009,382 | $ | 1,009,283 | $ | 99 | $ | — | ||||||||
Liabilities: | ||||||||||||||||
Derivative liabilities | $ | 1,937 | $ | — | $ | 1,937 | $ | — | ||||||||
Total liabilities measured at fair value | $ | 1,937 | $ | — | $ | 1,937 | $ | — | ||||||||
(1) | Money market funds are reported within “Cash and cash equivalents” on the Condensed Consolidated Balance Sheets. |
Restructuring_and_Other_Costs_
Restructuring and Other Costs (Tables) | 3 Months Ended | |||||||||||||||||||
Jan. 31, 2015 | ||||||||||||||||||||
Restructuring and Related Activities [Abstract] | ||||||||||||||||||||
Schedule of Restructuring and Other Charges | The following table provides details of the Company’s restructuring and other charges (in thousands): | |||||||||||||||||||
Three Months Ended | ||||||||||||||||||||
January 31, | January 25, | |||||||||||||||||||
2015 | 2014 | |||||||||||||||||||
Severance and benefits | $ | — | $ | (1,744 | ) | |||||||||||||||
Lease loss reserve and related costs | — | 7,961 | ||||||||||||||||||
Restructuring and other related costs | $ | — | $ | 6,217 | ||||||||||||||||
Schedule of Restructuring Reserve | The following table provides a reconciliation of the Company’s beginning and ending restructuring liability balances (in thousands): | |||||||||||||||||||
Fiscal 2013 Fourth Quarter Restructuring Plan | Prior Restructuring Plans | |||||||||||||||||||
Severance and Benefits | Contract Terminations and Other | Lease Loss Reserve and Related Costs | Lease Loss | Total | ||||||||||||||||
Reserve and Related Costs | ||||||||||||||||||||
Restructuring liabilities at November 1, 2014 | $ | 171 | $ | 42 | $ | 3,949 | $ | 994 | $ | 5,156 | ||||||||||
Cash payments | — | (42 | ) | (416 | ) | (112 | ) | (570 | ) | |||||||||||
Translation adjustment | — | — | (192 | ) | — | (192 | ) | |||||||||||||
Restructuring liabilities at January 31, 2015 | $ | 171 | $ | — | $ | 3,341 | $ | 882 | $ | 4,394 | ||||||||||
Current restructuring liabilities at January 31, 2015 | $ | 171 | $ | — | $ | 1,496 | $ | 396 | $ | 2,063 | ||||||||||
Non-current restructuring liabilities at January 31, 2015 | $ | — | $ | — | $ | 1,845 | $ | 486 | $ | 2,331 | ||||||||||
Borrowings_Tables
Borrowings (Tables) | 3 Months Ended | ||||||||||||||||
Jan. 31, 2015 | |||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||
Schedule of Long-term Debt Instruments | The following table provides details of the Company’s long-term debt (in thousands, except years and percentages): | ||||||||||||||||
January 31, 2015 | November 1, 2014 | ||||||||||||||||
Maturity | Stated Annual Interest Rate | Amount | Effective Interest Rate | Amount | Effective Interest Rate | ||||||||||||
Convertible Senior Unsecured Notes | |||||||||||||||||
2020 Convertible Notes | 2020 | 1.38% | $ | 575,000 | 4.98 | % | $ | — | — | % | |||||||
Senior Unsecured Notes: | |||||||||||||||||
2023 Notes | 2023 | 4.63% | 300,000 | 4.83 | % | 300,000 | 4.83 | % | |||||||||
Senior Secured Notes: | |||||||||||||||||
2020 Notes | 2015 | 6.88% | 300,000 | 8.39 | % | 300,000 | 7.26 | % | |||||||||
Capital lease obligations | 2016 | 5.00% | 963 | 5 | % | 2,115 | 5.37 | % | |||||||||
Total long-term debt | 1,175,963 | 602,115 | |||||||||||||||
Less: | |||||||||||||||||
Unamortized discount | 91,588 | 4,839 | |||||||||||||||
Current portion of long-term debt | 300,778 | 1,826 | |||||||||||||||
Long-term debt, net of current portion | $ | 783,597 | $ | 595,450 | |||||||||||||
Schedule of Carrying Values of Liability and Equity Components | The carrying values of the liability and equity components of the 2020 Convertible Notes are as follows (in thousands): | ||||||||||||||||
January 31, | November 1, | ||||||||||||||||
2015 | 2014 | ||||||||||||||||
Principal | $ | 575,000 | $ | — | |||||||||||||
Less: Unamortized discount of the liability component | 88,457 | — | |||||||||||||||
Net carrying amount of liability component | $ | 486,543 | $ | — | |||||||||||||
Carrying amount of equity component | $ | 81,818 | $ | — | |||||||||||||
Schedule Of Debt Maturities | As of January 31, 2015, our aggregate debt maturities based on outstanding principal were as follows (in thousands): | ||||||||||||||||
Fiscal Year | Principal | ||||||||||||||||
Balances | |||||||||||||||||
2015 (remaining nine months) | $ | 300,672 | |||||||||||||||
2016 | 291 | ||||||||||||||||
2017 | — | ||||||||||||||||
2018 | — | ||||||||||||||||
2019 | — | ||||||||||||||||
Thereafter | 875,000 | ||||||||||||||||
Total | $ | 1,175,963 | |||||||||||||||
Commitments_And_Contingencies_
Commitments And Contingencies (Tables) | 3 Months Ended | |||||||
Jan. 31, 2015 | ||||||||
Commitments and Contingencies Disclosure [Abstract] | ||||||||
Schedule Of Accrued Liability For Estimated Future Warranty Costs | The following table summarizes the activity related to the Company’s accrued liability for estimated future warranty costs during the three months ended January 31, 2015, and January 25, 2014, respectively (in thousands): | |||||||
Accrued Warranty | ||||||||
Three Months Ended | ||||||||
January 31, | January 25, | |||||||
2015 | 2014 | |||||||
Beginning balance | $ | 7,486 | $ | 8,632 | ||||
Liabilities accrued for warranties issued during the period | 1,262 | 866 | ||||||
Warranty claims paid and used during the period | (1,114 | ) | (1,761 | ) | ||||
Changes in liability for pre-existing warranties during the period | (446 | ) | (455 | ) | ||||
Ending balance | $ | 7,188 | $ | 7,282 | ||||
Derivative_Instruments_And_Hed2
Derivative Instruments And Hedging Activities (Tables) | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||
Schedule Of Net Gains (Losses) Related To The Effective Portion Of Foreign Currency Derivatives | Net gains (losses) relating to the effective portion of foreign currency derivatives recorded in the Condensed Consolidated Statements of Income are as follows (in thousands): | |||||||||||||||
Three Months Ended | ||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||
Cost of revenues | $ | (136 | ) | $ | 72 | |||||||||||
Research and development | (35 | ) | (300 | ) | ||||||||||||
Sales and marketing | (454 | ) | 239 | |||||||||||||
General and administrative | (58 | ) | 22 | |||||||||||||
Total | $ | (683 | ) | $ | 33 | |||||||||||
Schedule Of Total Gross Notional Amounts, Presented By Currency | Total gross notional amounts, presented by currency, are as follows (in thousands): | |||||||||||||||
Derivatives Designated | Derivatives Not Designated | |||||||||||||||
as Hedging Instruments | as Hedging Instruments | |||||||||||||||
In U.S. dollars | As of January 31, 2015 | As of November 1, 2014 | As of January 31, 2015 | As of November 1, 2014 | ||||||||||||
Euro | $ | 9,741 | $ | 14,404 | $ | 12,985 | $ | 19,200 | ||||||||
British pound | 7,887 | 11,168 | 10,517 | 14,891 | ||||||||||||
Indian rupee | 14,510 | 19,413 | — | — | ||||||||||||
Chinese yuan | 7,638 | 10,406 | — | — | ||||||||||||
Singapore dollar | 6,583 | 9,242 | — | — | ||||||||||||
Japanese yen | 6,342 | 8,856 | — | — | ||||||||||||
Swiss franc | 5,863 | 7,468 | — | — | ||||||||||||
Total | $ | 58,564 | $ | 80,957 | $ | 23,502 | $ | 34,091 | ||||||||
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | |||||||||||||
Jan. 31, 2015 | ||||||||||||||
Share-based Compensation, Allocation and Classification in Financial Statements [Abstract] | ||||||||||||||
Stock-Based Compensation Expense Included In Line Items Of Consolidated Statements Of Operations | Stock-based compensation expense, net of estimated forfeitures, was included in the following line items of the Condensed Consolidated Statements of Income as follows (in thousands): | |||||||||||||
Three Months Ended | ||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||
Cost of revenues | $ | 3,816 | $ | 3,142 | ||||||||||
Research and development | 4,933 | 4,336 | ||||||||||||
Sales and marketing | 9,843 | 6,765 | ||||||||||||
General and administrative | 5,490 | 4,345 | ||||||||||||
Total stock-based compensation | $ | 24,082 | $ | 18,588 | ||||||||||
Stock-Based Compensation Expense By Grant Type | The following table presents stock-based compensation expense, net of estimated forfeitures, by grant type (in thousands): | |||||||||||||
Three Months Ended | ||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||
Stock options | $ | 1,356 | $ | 1,281 | ||||||||||
Restricted stock units, including stock units with market conditions (altogether “RSUs”) | 17,934 | 14,584 | ||||||||||||
Employee stock purchase plan (“ESPP”) | 4,792 | 2,723 | ||||||||||||
Total stock-based compensation | $ | 24,082 | $ | 18,588 | ||||||||||
Stock-Based Compensation, Unrecognized Compensation Expense And Weighted-Average Period | The following table presents the unrecognized compensation expense, net of estimated forfeitures, of the Company’s equity compensation plans as of January 31, 2015, which is expected to be recognized over the following weighted-average periods (in thousands, except for the weighted-average period): | |||||||||||||
Unrecognized | Weighted- | |||||||||||||
Compensation | Average Period | |||||||||||||
Expense | (in years) | |||||||||||||
Stock options | $ | 5,791 | 1.41 | |||||||||||
RSUs | $ | 130,468 | 2.04 | |||||||||||
ESPP | $ | 12,005 | 0.95 | |||||||||||
Schedule of Share-based Compensation, Activity | The following table presents details on grants made by the Company for the following periods: | |||||||||||||
Three Months Ended | ||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||
Granted | Weighted-Average | Granted | Weighted-Average | |||||||||||
(in thousands) | Grant Date Fair Value | (in thousands) | Grant Date Fair Value | |||||||||||
Stock options | 1,117 | $ | 3.09 | 1,270 | $ | 3.25 | ||||||||
RSUs | 3,641 | $ | 10.87 | 2,885 | $ | 10.75 | ||||||||
The total intrinsic value of stock options exercised for the three months ended January 31, 2015, and January 25, 2014, was $1.0 million and $2.1 million, respectively. |
Stockholders_Equity_Tables
Stockholders' Equity (Tables) | 3 Months Ended | |||||||||||||||||||||||
Jan. 31, 2015 | ||||||||||||||||||||||||
Equity [Abstract] | ||||||||||||||||||||||||
Schedule of Dividends Payable [Table Text Block] | During the three months ended January 31, 2015, the Company’s Board of Directors declared the following dividends (in thousands, except per share amounts): | |||||||||||||||||||||||
Declaration Date | Dividend per Share | Record Date | Total Amount Paid | Payment Date | ||||||||||||||||||||
November 24, 2014 | $ | 0.035 | December 10, 2014 | $ | 15,106 | January 2, 2015 | ||||||||||||||||||
Schedule of Comprehensive Income (Loss) Tax Effects | The tax effects allocated to each component of other comprehensive income (loss) for the three months ended January 31, 2015, and January 25, 2014, are as follows (in thousands): | |||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||||||||||
Before-Tax Amount | Tax (Expense) or Benefit | Net-of-Tax Amount | Before-Tax Amount | Tax Benefit | Net-of-Tax Amount | |||||||||||||||||||
Unrealized gains (losses) on cash flow hedges: | ||||||||||||||||||||||||
Change in unrealized gains and losses, foreign exchange contracts | $ | (2,179 | ) | $ | 405 | $ | (1,774 | ) | $ | (1,021 | ) | $ | 97 | $ | (924 | ) | ||||||||
Net gains and losses reclassified into earnings, foreign exchange contracts (1) | 683 | (80 | ) | 603 | (33 | ) | 2 | (31 | ) | |||||||||||||||
Net unrealized gains (losses) on cash flow hedges | (1,496 | ) | 325 | (1,171 | ) | (1,054 | ) | 99 | (955 | ) | ||||||||||||||
Foreign currency translation adjustments | (4,221 | ) | — | (4,221 | ) | (823 | ) | — | (823 | ) | ||||||||||||||
Total other comprehensive loss | $ | (5,717 | ) | $ | 325 | $ | (5,392 | ) | $ | (1,877 | ) | $ | 99 | $ | (1,778 | ) | ||||||||
-1 | For Condensed Consolidated Statements of Income classification of amounts reclassified from accumulated other comprehensive loss, see Note 10, “Derivative Instruments and Hedging Activities,” of the Notes to Condensed Consolidated Financial Statements. | |||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The changes in accumulated other comprehensive loss by component, net of tax, for the three months ended January 31, 2015, and January 25, 2014, are as follows (in thousands): | |||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||
January 31, 2015 | January 25, 2014 | |||||||||||||||||||||||
Gains (Losses) on Cash Flow Hedges | Foreign Currency Translation Adjustments | Total Accumulated Other Comprehensive Loss | Gains (Losses) on Cash Flow Hedges | Foreign Currency Translation Adjustments | Total Accumulated Other Comprehensive Loss | |||||||||||||||||||
Beginning balance | $ | (1,907 | ) | $ | (16,907 | ) | $ | (18,814 | ) | $ | 267 | $ | (13,711 | ) | $ | (13,444 | ) | |||||||
Change in unrealized gains and losses | (1,774 | ) | (4,221 | ) | (5,995 | ) | (924 | ) | (823 | ) | (1,747 | ) | ||||||||||||
Net gains and losses reclassified into earnings | 603 | — | 603 | (31 | ) | — | (31 | ) | ||||||||||||||||
Net current-period other comprehensive loss | (1,171 | ) | (4,221 | ) | (5,392 | ) | (955 | ) | (823 | ) | (1,778 | ) | ||||||||||||
Ending balance | $ | (3,078 | ) | $ | (21,128 | ) | $ | (24,206 | ) | $ | (688 | ) | $ | (14,534 | ) | $ | (15,222 | ) |
Segment_Information_Tables
Segment Information (Tables) | 3 Months Ended | |||||||||||||||
Jan. 31, 2015 | ||||||||||||||||
Segment Reporting [Abstract] | ||||||||||||||||
Schedule Of Financial Information By Reportable Segment | Summarized financial information by reportable segment for the three months ended January 31, 2015, and January 25, 2014, based on the internal management reporting system, is as follows (in thousands): | |||||||||||||||
SAN Products | IP Networking Products | Global Services | Total | |||||||||||||
Three months ended January 31, 2015 | ||||||||||||||||
Net revenues | $ | 353,399 | $ | 132,839 | $ | 90,001 | $ | 576,239 | ||||||||
Cost of revenues | 85,725 | 64,201 | 36,630 | 186,556 | ||||||||||||
Gross margin | $ | 267,674 | $ | 68,638 | $ | 53,371 | $ | 389,683 | ||||||||
Three months ended January 25, 2014 | ||||||||||||||||
Net revenues | $ | 355,456 | $ | 119,749 | $ | 89,330 | $ | 564,535 | ||||||||
Cost of revenues | 92,941 | 60,686 | 38,238 | 191,865 | ||||||||||||
Gross margin | $ | 262,515 | $ | 59,063 | $ | 51,092 | $ | 372,670 | ||||||||
Net_Income_Per_Share_Tables
Net Income Per Share (Tables) | 3 Months Ended | |||||||
Jan. 31, 2015 | ||||||||
Earnings Per Share [Abstract] | ||||||||
Schedule Of Calculation Of Basic And Diluted Net Income (Loss) Per Share | The following table presents the calculation of basic and diluted net income per share (in thousands, except per share amounts): | |||||||
Three Months Ended | ||||||||
January 31, | January 25, | |||||||
2015 | 2014 | |||||||
Basic net income per share | ||||||||
Net income | $ | 87,267 | $ | 80,884 | ||||
Weighted-average shares used in computing basic net income per share | 428,536 | 440,573 | ||||||
Basic net income per share | $ | 0.2 | $ | 0.18 | ||||
Diluted net income per share | ||||||||
Net income | $ | 87,267 | $ | 80,884 | ||||
Weighted-average shares used in computing basic net income per share | 428,536 | 440,573 | ||||||
Dilutive potential common shares in the form of stock options | 1,734 | 2,620 | ||||||
Dilutive potential common shares in the form of other share-based awards | 8,886 | 10,356 | ||||||
Weighted-average shares used in computing diluted net income per share | 439,156 | 453,549 | ||||||
Diluted net income per share | $ | 0.2 | $ | 0.18 | ||||
Antidilutive potential common shares in the form of: (1) | ||||||||
Warrants issued in conjunction with the 2020 Convertible Notes (2) | 7,140 | — | ||||||
Stock options | 577 | 3,015 | ||||||
Other share-based awards | — | 462 | ||||||
(1) | These amounts are excluded from the computation of diluted net income per share. | |||||||
(2) | In connection with the issuance of the 2020 Convertible Notes, the Company entered into convertible note hedge and warrant transactions as described in Note 8, “Borrowings.” The 2020 Convertible Notes have no impact on diluted earnings per share until the average quarterly price of the Company’s common stock exceeds the conversion price of $15.93 per share. If the common stock price exceeds this conversion price, prior to conversion, the Company will calculate the effect of the additional shares that may be issued using the treasury stock method. If the average price of the Company’s common stock exceeds $20.65 per share for a quarterly period, the Company’s weighted-average shares used in computing diluted net income per share will be impacted by the effect of the additional potential shares that may be issued related to the warrants using the treasury stock method. The convertible note hedge is not considered for purposes of the diluted earnings per share calculation, as its effect would be antidilutive. |
Summary_Of_Significant_Account1
Summary Of Significant Accounting Policies (Concentration of Risk Narrative)(Details) | 3 Months Ended | 12 Months Ended | 3 Months Ended |
Jan. 31, 2015 | Nov. 01, 2014 | Jan. 25, 2014 | |
customer | customer | ||
Concentration Risk | |||
Number of Financial Institutions | 5 | ||
Customer Concentration Risk | Accounts Receivable | |||
Concentration Risk | |||
Concentration Risk, Percentage | 38.00% | ||
Number Of Customers Included In Concentration Disclosures | 1 | 3 | |
Customer Concentration Risk | Accounts Receivable | Major Customer One | |||
Concentration Risk | |||
Concentration Risk, Percentage | 24.00% | 15.00% | |
Customer Concentration Risk | Accounts Receivable | Major Customer Two | |||
Concentration Risk | |||
Concentration Risk, Percentage | 12.00% | ||
Customer Concentration Risk | Accounts Receivable | Major Customer Three | |||
Concentration Risk | |||
Concentration Risk, Percentage | 11.00% | ||
Customer Concentration Risk | Sales Revenue, Segment | |||
Concentration Risk | |||
Concentration Risk, Percentage | 44.00% | 57.00% | |
Number Of Customers Included In Concentration Disclosures | 3 | 4 | |
Customer Concentration Risk | Sales Revenue, Segment | Major Customer One | |||
Concentration Risk | |||
Concentration Risk, Percentage | 20.00% | 18.00% | |
Customer Concentration Risk | Sales Revenue, Segment | Major Customer Two | |||
Concentration Risk | |||
Concentration Risk, Percentage | 14.00% | 18.00% | |
Customer Concentration Risk | Sales Revenue, Segment | Major Customer Three | |||
Concentration Risk | |||
Concentration Risk, Percentage | 10.00% | 11.00% | |
Customer Concentration Risk | Sales Revenue, Segment | Major Customer Four | |||
Concentration Risk | |||
Concentration Risk, Percentage | 10.00% |
Divestitures_Narrative_Details
Divestitures (Narrative) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
Jan. 31, 2015 | Jan. 25, 2014 | Nov. 01, 2014 | Jan. 17, 2014 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups | ||||
Disposal Group, Gain (Loss) on Disposal | $0 | $4,884,000 | ||
Network Adapter Business | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups | ||||
Disposal Group, Description and Timing of Disposal | On January 17, 2014, the Company completed the sale of its network adapter business to QLogic Corporation, as part of the Company’s business strategy to focus development on a portfolio of high performance networking products and services—both hardware and software-based—that meet the demands of today’s data centers whether virtualized or cloud based. | |||
Net Assets of Disposal Group | 5,100,000 | |||
Disposal Group, Goodwill | 4,100,000 | |||
Disposal Group, Gain (Loss) on Disposal | $4,900,000 | |||
Disposal Group, Income Statement Caption | Gain on sale of network adapter business |
Goodwill_And_Intangible_Assets3
Goodwill And Intangible Assets (Schedule of Intangible Assets and Goodwill) (Details) (USD $) | 3 Months Ended | ||||
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 | Nov. 01, 2014 | ||
Intangible Assets, Net (Including Goodwill) | |||||
Goodwill | $1,567,718 | $1,567,723 | |||
In-process research and development (1) | 15,110 | [1] | 15,110 | [1] | |
Total intangible assets subject to amortization (2) | 18,523 | [2] | 11,548 | [2] | |
Total intangible assets | 1,601,351 | 1,594,381 | |||
Payments to Acquire Intangible Assets | $7,750 | $0 | |||
[1] | Acquired in-process research and development (“IPR&Dâ€) is an intangible asset accounted for as an indefinite-lived asset until the completion or abandonment of the associated research and development effort. If the research and development effort associated with the IPR&D is successfully completed, then the IPR&D intangible asset will be amortized over its estimated useful life to be determined at the date the effort is completed. The development effort on the IPR&D intangible asset is expected to be completed by the first half of fiscal year 2016. | ||||
[2] | During the three months ended January 31, 2015, the Company purchased a perpetual, non-exclusive license to certain patents for $7.8 million. |
Goodwill_And_Intangible_Assets4
Goodwill And Intangible Assets (Schedule Of Goodwill Activity By Reportable Segment) (Details) (USD $) | 3 Months Ended | ||
Jan. 31, 2015 | 3-May-14 | ||
Goodwill | |||
Goodwill, Gross, Beginning Balance | $1,696,937,000 | ||
Accumulated impairment losses, Beginning Balance | -129,214,000 | ||
Goodwill, Net, Beginning Balance | 1,567,723,000 | ||
Goodwill, Tax and other adjustments | -5,000 | [1] | |
Goodwill, Gross, Ending Balance | 1,696,932,000 | ||
Accumulated impairment losses, Ending Balance | -129,214,000 | ||
Goodwill, Net, Ending Balance | 1,567,718,000 | ||
SAN Products | |||
Goodwill | |||
Goodwill, Gross, Beginning Balance | 176,346,000 | ||
Accumulated impairment losses, Beginning Balance | 0 | ||
Goodwill, Net, Beginning Balance | 176,346,000 | ||
Goodwill, Tax and other adjustments | -5,000 | [1] | |
Goodwill, Gross, Ending Balance | 176,341,000 | ||
Accumulated impairment losses, Ending Balance | 0 | ||
Goodwill, Net, Ending Balance | 176,341,000 | ||
Internet Protocol (“IPâ€) Networking Products | |||
Goodwill | |||
Goodwill, Gross, Beginning Balance | 1,365,175,000 | ||
Accumulated impairment losses, Beginning Balance | -129,214,000 | ||
Goodwill, Net, Beginning Balance | 1,235,961,000 | ||
Goodwill, Impairment Loss | -83,400,000 | ||
Goodwill, Tax and other adjustments | 0 | [1] | |
Goodwill, Gross, Ending Balance | 1,365,175,000 | ||
Accumulated impairment losses, Ending Balance | -129,214,000 | ||
Goodwill, Net, Ending Balance | 1,235,961,000 | ||
Global Services | |||
Goodwill | |||
Goodwill, Gross, Beginning Balance | 155,416,000 | ||
Accumulated impairment losses, Beginning Balance | 0 | ||
Goodwill, Net, Beginning Balance | 155,416,000 | ||
Goodwill, Tax and other adjustments | 0 | [1] | |
Goodwill, Gross, Ending Balance | 155,416,000 | ||
Accumulated impairment losses, Ending Balance | 0 | ||
Goodwill, Net, Ending Balance | $155,416,000 | ||
[1] | The goodwill adjustments during the three months ended January 31, 2015, were primarily a result of tax benefits from the exercise of stock awards of acquired companies. |
Goodwill_And_Intangible_Assets5
Goodwill And Intangible Assets (Schedule Of Company's Intangible Assets) (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||
In Thousands, unless otherwise specified | Jan. 31, 2015 | Nov. 01, 2014 | ||
Finite-Lived Intangible Assets | ||||
Gross Carrying Value | $22,310 | $14,560 | ||
Accumulated Amortization | 3,787 | 3,012 | ||
Net Carrying Value | 18,523 | [1] | 11,548 | [1] |
Weighted- Average Remaining Useful Life (in years) | 10 years 1 month 6 days | 4 years 1 month 6 days | ||
Trade name | ||||
Finite-Lived Intangible Assets | ||||
Gross Carrying Value | 590 | 590 | ||
Accumulated Amortization | 262 | 227 | ||
Net Carrying Value | 328 | 363 | ||
Weighted- Average Remaining Useful Life (in years) | 2 years 9 months 18 days | 3 years 0 months 0 days | ||
Core/developed technology | ||||
Finite-Lived Intangible Assets | ||||
Gross Carrying Value | 12,080 | 12,080 | ||
Accumulated Amortization | 2,602 | 1,964 | ||
Net Carrying Value | 9,478 | 10,116 | ||
Weighted- Average Remaining Useful Life (in years) | 4 years 0 months 25 days | 4 years 3 months 18 days | ||
Patent license (1) | ||||
Finite-Lived Intangible Assets | ||||
Gross Carrying Value | 7,750 | [2] | ||
Accumulated Amortization | 0 | [2] | ||
Net Carrying Value | 7,750 | [2] | ||
Weighted- Average Remaining Useful Life (in years) | 18 years 8 months 26 days | [2] | ||
Customer relationships | ||||
Finite-Lived Intangible Assets | ||||
Gross Carrying Value | 1,080 | 1,080 | ||
Accumulated Amortization | 479 | 427 | ||
Net Carrying Value | 601 | 653 | ||
Weighted- Average Remaining Useful Life (in years) | 2 years 9 months 4 days | 3 years 0 months 4 days | ||
Non-compete agreements | ||||
Finite-Lived Intangible Assets | ||||
Gross Carrying Value | 810 | 810 | ||
Accumulated Amortization | 444 | 394 | ||
Net Carrying Value | $366 | $416 | ||
Weighted- Average Remaining Useful Life (in years) | 1 year 9 months 4 days | 2 years 0 months 4 days | ||
[1] | During the three months ended January 31, 2015, the Company purchased a perpetual, non-exclusive license to certain patents for $7.8 million. | |||
[2] | The patent license was assigned an estimated useful life that reflects the Company’s consumption of the expected defensive benefits related to this intangible asset. The method of amortization for the patent license reflects the Company’s estimate of the pattern in which these expected defensive benefits will be consumed or otherwise used up by the Company, and is primarily driven by a mix of expiration patterns of the individual patents included in the license. |
Goodwill_And_Intangible_Assets6
Goodwill And Intangible Assets (Schedule Of Amortization Of Intangible Assets Included On Consolidated Statements Of Operations) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Cost of revenues | $637 | $6,462 |
Operating expenses | 138 | 9,883 |
Total | $775 | $16,345 |
Goodwill_And_Intangible_Assets7
Goodwill And Intangible Assets (Schedule Of Estimated Future Amortization Of Intangible Assets) (Details) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 | ||
In Thousands, unless otherwise specified | ||||
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||||
2015 (remaining nine months) | $3,173 | |||
2016 | 3,875 | |||
2017 | 3,476 | |||
2018 | 3,139 | |||
2019 | 1,680 | |||
Thereafter | 3,180 | |||
Total | $18,523 | [1] | $11,548 | [1] |
[1] | During the three months ended January 31, 2015, the Company purchased a perpetual, non-exclusive license to certain patents for $7.8 million. |
Balance_Sheet_Details_Schedule
Balance Sheet Details (Schedule of Inventory) (Details) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ||
Raw materials | $11,592 | $10,491 |
Finished goods | 28,683 | 28,227 |
Inventory, Net | $40,275 | $38,718 |
Balance_Sheet_Details_Schedule1
Balance Sheet Details (Schedule of Property, Plant and Equipment) (Details) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 | ||
In Thousands, unless otherwise specified | ||||
Property, Plant and Equipment | ||||
Property and equipment, gross | $900,952 | $897,329 | ||
Less: Accumulated depreciation and amortization | -458,308 | [1] | -451,896 | [1] |
Total property and equipment, net | 442,644 | 445,433 | ||
Computer equipment | ||||
Property, Plant and Equipment | ||||
Property and equipment, gross | 13,569 | 13,679 | ||
Software | ||||
Property, Plant and Equipment | ||||
Property and equipment, gross | 64,266 | 62,919 | ||
Engineering and other equipment | ||||
Property, Plant and Equipment | ||||
Property and equipment, gross | 385,394 | [1] | 383,412 | [1] |
Furniture and fixtures | ||||
Property, Plant and Equipment | ||||
Property and equipment, gross | 28,646 | [1] | 29,053 | [1] |
Leasehold improvements | ||||
Property, Plant and Equipment | ||||
Property and equipment, gross | 24,651 | 23,607 | ||
Land and building | ||||
Property, Plant and Equipment | ||||
Property and equipment, gross | $384,426 | $384,659 | ||
[1] | Engineering and other equipment, furniture and fixtures, and accumulated depreciation and amortization include the following amounts under capital leases as of January 31, 2015, and November 1, 2014, respectively (in thousands): January 31, 2015 November 1, 2014Cost$11,925 $11,925Accumulated depreciation(7,669) (7,209)Property and equipment, net, under capital leases$4,256 $4,716 |
Balance_Sheet_Details_Schedule2
Balance Sheet Details (Schedule of Capital Leased Assets) (Details) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 |
In Thousands, unless otherwise specified | ||
Capital Leases | ||
Cost | $11,925 | $11,925 |
Accumulated depreciation | -7,669 | -7,209 |
Total | $4,256 | $4,716 |
Balance_Sheet_Details_Narrativ
Balance Sheet Details (Narratives) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Balance Sheet Details [Abstract] | ||
Depreciation expense | $18,800 | $22,409 |
Fair_Value_Measurements_Schedu
Fair Value Measurements (Schedule Of Assets And Liabilities Measured At Fair Value) (Details) (Fair Value, Measurements, Recurring [Member], USD $) | Jan. 31, 2015 | Nov. 01, 2014 | ||
In Thousands, unless otherwise specified | ||||
Assets | ||||
Money market funds | $1,113,605 | [1] | $1,009,283 | [1] |
Derivative assets | 108 | 99 | ||
Total assets measured at fair value | 1,113,713 | 1,009,382 | ||
Liabilities | ||||
Derivative liabilities | 3,310 | 1,937 | ||
Total liabilities measured at fair value | 3,310 | 1,937 | ||
Quoted Prices In Active Markets For Identical Instruments (Level 1) | ||||
Assets | ||||
Money market funds | 1,113,605 | [1] | 1,009,283 | [1] |
Derivative assets | 0 | 0 | ||
Total assets measured at fair value | 1,113,605 | 1,009,283 | ||
Liabilities | ||||
Derivative liabilities | 0 | 0 | ||
Total liabilities measured at fair value | 0 | 0 | ||
Significant Other Observable Inputs (Level 2) | ||||
Assets | ||||
Money market funds | 0 | [1] | 0 | [1] |
Derivative assets | 108 | 99 | ||
Total assets measured at fair value | 108 | 99 | ||
Liabilities | ||||
Derivative liabilities | 3,310 | 1,937 | ||
Total liabilities measured at fair value | 3,310 | 1,937 | ||
Significant Unobservable Inputs (Level 3) | ||||
Assets | ||||
Money market funds | 0 | [1] | 0 | [1] |
Derivative assets | 0 | 0 | ||
Total assets measured at fair value | 0 | 0 | ||
Liabilities | ||||
Derivative liabilities | 0 | 0 | ||
Total liabilities measured at fair value | $0 | $0 | ||
[1] | Money market funds are reported within “Cash and cash equivalents†on the Condensed Consolidated Balance Sheets. |
Restructuring_and_Other_Costs_1
Restructuring and Other Costs (Schedule of Restructuring and Other Charges) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Restructuring Charges [Abstract] | ||
Severance Costs | $0 | ($1,744) |
Business Exit Costs | 0 | 7,961 |
Restructuring and other related costs | $0 | $6,217 |
Restructuring_and_Other_Costs_2
Restructuring and Other Costs (Schedule of Restructuring Reserve) (Details) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Jan. 31, 2015 |
Restructuring | |
Restructuring and Related Cost, Caption that Includes Restructuring Charges | Restructuring and other related costs |
Initial Period in which Effects are Expected to be Realized | Cash payments for facilities that are part of the Company’s lease loss reserve are expected to be paid over the respective lease terms through fiscal year 2021. |
Restructuring Reserve Rollforward | |
Restructuring liabilities, Beginning balance | $5,156 |
Cash payments | -570 |
Translation adjustment | -192 |
Restructuring liabilities, Ending balance | 4,394 |
Restructuring Reserve Ending Balance | |
Current restructuring liabilities | 2,063 |
Non-current restructuring liabilities | 2,331 |
Fiscal 2013 Fourth Quarter Restructuring Plan | |
Restructuring | |
Restructuring and Related Activities, Description | During the fiscal year ended October 26, 2013, and the first quarter of fiscal year 2014, the Company restructured certain business operations and reduced the Company’s operating expense structure. The restructuring plan was approved by the Company’s management and communicated to the Company’s employees in September 2013. The restructuring plan included a workforce reduction of approximately 250 employees, primarily in the engineering, sales, and marketing organizations, as well as the cancellation of certain nonrecurring engineering agreements and exits from certain leased facilities. The Company substantially completed the restructuring plan by the end of the first quarter of fiscal year 2014. |
Restructuring and Related Activities, Authorized Approval | The restructuring plan was approved by the Company’s management and communicated to the Company’s employees in September 2013. |
Restructuring Reserve, Adjustment Description | The Company reevaluates its estimates and assumptions on a quarterly basis and makes adjustments to the restructuring liabilities balance if necessary. During the three months ended January 31, 2015, there were no adjustments made to the restructuring liabilities balance, as there were no changes in its estimates or assumptions. |
Restructuring and Related Activities, Initiation Date | 4-Sep-13 |
Restructuring and Related Cost, Number of Positions Eliminated, Inception to Date | 250 |
Restructuring and Related Activities, Completion Date | 25-Jan-14 |
Prior Restructuring Plans | |
Restructuring | |
Restructuring and Related Activities, Description | Prior to fiscal year 2013, the Company also recorded charges related to estimated facilities lease losses, net of expected sublease income, due to consolidation of real estate space as a result of acquisitions. |
Severance and Benefits | Fiscal 2013 Fourth Quarter Restructuring Plan | |
Restructuring Reserve Rollforward | |
Restructuring liabilities, Beginning balance | 171 |
Cash payments | 0 |
Translation adjustment | 0 |
Restructuring liabilities, Ending balance | 171 |
Restructuring Reserve Ending Balance | |
Current restructuring liabilities | 171 |
Non-current restructuring liabilities | 0 |
Contract Terminations and Other | Fiscal 2013 Fourth Quarter Restructuring Plan | |
Restructuring Reserve Rollforward | |
Restructuring liabilities, Beginning balance | 42 |
Cash payments | -42 |
Translation adjustment | 0 |
Restructuring liabilities, Ending balance | 0 |
Restructuring Reserve Ending Balance | |
Current restructuring liabilities | 0 |
Non-current restructuring liabilities | 0 |
Lease Loss Reserve and Related Costs | Fiscal 2013 Fourth Quarter Restructuring Plan | |
Restructuring Reserve Rollforward | |
Restructuring liabilities, Beginning balance | 3,949 |
Cash payments | -416 |
Translation adjustment | -192 |
Restructuring liabilities, Ending balance | 3,341 |
Restructuring Reserve Ending Balance | |
Current restructuring liabilities | 1,496 |
Non-current restructuring liabilities | 1,845 |
Lease Loss Reserve and Related Costs | Prior Restructuring Plans | |
Restructuring Reserve Rollforward | |
Restructuring liabilities, Beginning balance | 994 |
Cash payments | -112 |
Translation adjustment | 0 |
Restructuring liabilities, Ending balance | 882 |
Restructuring Reserve Ending Balance | |
Current restructuring liabilities | 396 |
Non-current restructuring liabilities | $486 |
Borrowings_Schedule_Of_LongTer
Borrowings (Schedule Of Long-Term Debt) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Nov. 01, 2014 |
Debt Instrument | ||
Long-term debt, gross | $1,175,963 | $602,115 |
Unamortized discount | 91,588 | 4,839 |
Current portion of long-term debt | 300,778 | 1,826 |
Long-term debt, net of current portion | 783,597 | 595,450 |
Senior Secured 2020 Notes | ||
Debt Instrument | ||
Maturity | 13-Feb-15 | |
Stated annual interest rate | 6.88% | |
Long-term debt, gross | 300,000 | 300,000 |
Effective interest rate | 8.39% | 7.26% |
Convertible Senior Unsecured 2020 Notes | ||
Debt Instrument | ||
Maturity | 1-Jan-20 | |
Stated annual interest rate | 1.38% | |
Long-term debt, gross | 575,000 | 0 |
Effective interest rate | 4.98% | 0.00% |
Unamortized discount | 88,457 | 0 |
Senior Unsecured 2023 Notes | ||
Debt Instrument | ||
Maturity | 15-Jan-23 | |
Stated annual interest rate | 4.63% | |
Long-term debt, gross | 300,000 | 300,000 |
Effective interest rate | 4.83% | 4.83% |
Capital Lease Obligations | ||
Debt Instrument | ||
Maturity | 31-May-16 | |
Stated annual interest rate | 5.00% | |
Long-term debt, gross | $963 | $2,115 |
Effective interest rate | 5.00% | 5.37% |
Borrowings_Schedule_of_Carryin
Borrowings (Schedule of Carrying Values of Liability and Equity Components) (Details) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 |
In Thousands, unless otherwise specified | ||
Debt Instrument | ||
Long-term debt, gross | $1,175,963 | $602,115 |
Unamortized discount | 91,588 | 4,839 |
Convertible Senior Unsecured 2020 Notes | ||
Debt Instrument | ||
Long-term debt, gross | 575,000 | 0 |
Unamortized discount | 88,457 | 0 |
Long-term Debt | 486,543 | 0 |
Carrying amount of equity component | $81,818 | $0 |
Borrowings_Narrative_Details
Borrowings (Narrative) (Details) (USD $) | 3 Months Ended | |||||||
Share data in Millions, except Per Share data, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 | Jan. 24, 2009 | Jan. 20, 2010 | Jan. 14, 2015 | Nov. 01, 2014 | Jan. 22, 2013 | Oct. 31, 2008 |
Debt Instrument | ||||||||
Proceeds from convertible notes | $565,656,000 | $0 | ||||||
Purchase of convertible hedge | 86,135,000 | 0 | ||||||
Proceeds from issuance of warrants | 51,175,000 | 0 | ||||||
Senior Secured 2018 Notes | ||||||||
Debt Instrument | ||||||||
Debt Instrument, Face Amount | 300,000,000 | |||||||
Senior Secured 2020 Notes | ||||||||
Debt Instrument | ||||||||
Debt Instrument, Face Amount | 300,000,000 | |||||||
Stated annual interest rate | 6.88% | |||||||
Long-Term Debt, Fair Value | 310,100,000 | 312,500,000 | ||||||
Maturity | 13-Feb-15 | |||||||
Debt Instrument, Redemption Price, Percentage | 103.44% | |||||||
Irrevocable deposit | 322,200,000 | |||||||
Repayment of principal amount | 300,000,000 | |||||||
Call premium | 10,300,000 | |||||||
Debt Instrument, Increase, Accrued Interest | 10,300,000 | |||||||
Unpaid interest deposited to escrow | 1,600,000 | |||||||
Call premium cost and original issue discount and debt issuance costs related to lenders that did not participate in refinancing | 20,400,000 | |||||||
Convertible Senior Unsecured 2020 Notes | ||||||||
Debt Instrument | ||||||||
Debt Instrument, Face Amount | 575,000,000 | |||||||
Proceeds from convertible notes | 565,700,000 | |||||||
DiscountRateForFairValueOfLiabilityComponent | 4.57% | |||||||
Stated annual interest rate | 1.38% | |||||||
Debt Instrument, Convertible, Remaining Discount Amortization Period | 4 years 11 months 1 day | |||||||
Long-Term Debt, Fair Value | 591,000,000 | |||||||
Maturity | 1-Jan-20 | |||||||
Debt Instrument, Convertible, Conversion Ratio | 62.7746 | |||||||
Debt Instrument, Convertible, Conversion Price | $15.93 | |||||||
Debt Instrument, Convertible, Number of Equity Instruments | 36.1 | |||||||
Debt Instrument, Convertible, If-converted Value in Excess of Principal | 0 | |||||||
Repurchase price of notes in case of change in control, percentage of face value | 100.00% | |||||||
Shares Covered By Note Hedge | 36.1 | |||||||
Note Hedge, Exercise Price | $15.93 | |||||||
Purchase of convertible hedge | 86,100,000 | |||||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 36.1 | |||||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $20.65 | |||||||
Class of Warrant or Right, Date from which Warrants or Rights Exercisable | 1-Apr-20 | |||||||
WarrantsMaturityPeriod | 60 days | |||||||
Proceeds from issuance of warrants | 51,200,000 | |||||||
Interest Expense, Debt [Abstract] | ||||||||
Amortization of Debt Discount | 700,000 | |||||||
Interest Expense, Debt, Excluding Amortization | 400,000 | |||||||
Interest Expense, Debt | 0 | |||||||
Senior Unsecured 2023 Notes | ||||||||
Debt Instrument | ||||||||
Debt Instrument, Face Amount | 300,000,000 | |||||||
Stated annual interest rate | 4.63% | |||||||
Long-Term Debt, Fair Value | 295,600,000 | 292,400,000 | ||||||
Maturity | 15-Jan-23 | |||||||
Repurchase price of notes in case of change in control, percentage of face value | 101.00% | |||||||
Debt Instrument, Redemption Price, Percentage | 100.00% | |||||||
Redemption amount of notes, percentage of principal amount, when using the net cash proceed from capital stock sale | 35.00% | |||||||
Redemption price, percentage of principal amount, when using the net cash proceed from capital stock sale | 104.63% | |||||||
Term Loan Facility | ||||||||
Debt Instrument | ||||||||
Original term of loan | 5 years | |||||||
Senior secured credit facility, maximum borrowing capacity | 1,100,000,000 | |||||||
Revolving Credit Facility | ||||||||
Debt Instrument | ||||||||
Original term of loan | 5 years | |||||||
Senior secured credit facility, maximum borrowing capacity | 125,000,000 | 125,000,000 | 125,000,000 | |||||
Swing Line Loan Subfacility | ||||||||
Debt Instrument | ||||||||
Senior secured credit facility, maximum borrowing capacity | 25,000,000 | |||||||
Letter Of Credit Subfacility | ||||||||
Debt Instrument | ||||||||
Senior secured credit facility, maximum borrowing capacity | 25,000,000 | |||||||
Line of Credit | $0 | $0 | ||||||
Trading Price Trigger One | Convertible Senior Unsecured 2020 Notes | ||||||||
Debt Instrument | ||||||||
Debt Instrument, Convertible, Threshold Trading Days | 20 | |||||||
Debt Instrument, Convertible, Threshold Consecutive Trading Days | 30 days | |||||||
Debt Instrument, Convertible, Threshold Percentage of Stock Price Trigger | 130.00% | |||||||
Trading Price Trigger Two | Convertible Senior Unsecured 2020 Notes | ||||||||
Debt Instrument | ||||||||
Debt Instrument, Convertible, Threshold Trading Days | 5 | |||||||
Debt Instrument, Convertible, Threshold Consecutive Trading Days | 10 days | |||||||
Debt Instrument, Convertible, Threshold Percentage of Notes Price Trigger | 98.00% |
Borrowings_Schedule_Of_Debt_Ma
Borrowings (Schedule Of Debt Maturities) (Details) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 |
In Thousands, unless otherwise specified | ||
Long-term Debt, by Maturity [Abstract] | ||
2015 (remaining nine months) | $300,672 | |
2016 | 291 | |
2017 | 0 | |
2018 | 0 | |
2019 | 0 | |
Thereafter | 875,000 | |
Long-term debt, gross | $1,175,963 | $602,115 |
Commitments_And_Contingencies_1
Commitments And Contingencies (Schedule Of Accrued Liability For Estimated Future Warranty Costs) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Product Warranty Activity | ||
Beginning balance | $7,486 | $8,632 |
Liabilities accrued for warranties issued during the period | 1,262 | 866 |
Warranty claims paid and used during the period | -1,114 | -1,761 |
Changes in liability for pre-existing warranties during the period | -446 | -455 |
Ending balance | $7,188 | $7,282 |
Commitments_And_Contingencies_2
Commitments And Contingencies (Purchase Commitment Narrative) (Details) (Details) (Inventory Purchase Commitment, USD $) | Jan. 31, 2015 |
In Millions, unless otherwise specified | |
Inventory Purchase Commitment | |
Purchase Commitment, Excluding Long-term Commitment [Line Items] | |
Purchase Commitment, Remaining Minimum Amount Committed | $181.40 |
Purchase Commitment, Recognized Loss | $1.10 |
Derivative_Instruments_And_Hed3
Derivative Instruments And Hedging Activities (Schedule Of Net Gains (Losses) Related To The Effective Portion Of Foreign Currency Derivatives) (Details) (Foreign Exchange Contract, USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Derivative Instruments, Gain (Loss) | ||
Net gains (losses) related to the effective portion of foreign currency derivatives | ($683) | $33 |
Cost of revenues | ||
Derivative Instruments, Gain (Loss) | ||
Net gains (losses) related to the effective portion of foreign currency derivatives | -136 | 72 |
Research and development | ||
Derivative Instruments, Gain (Loss) | ||
Net gains (losses) related to the effective portion of foreign currency derivatives | -35 | -300 |
Sales and marketing | ||
Derivative Instruments, Gain (Loss) | ||
Net gains (losses) related to the effective portion of foreign currency derivatives | -454 | 239 |
General and administrative | ||
Derivative Instruments, Gain (Loss) | ||
Net gains (losses) related to the effective portion of foreign currency derivatives | ($58) | $22 |
Derivative_Instruments_And_Hed4
Derivative Instruments And Hedging Activities (Narrative) (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Maximum derivative instrument maturity period | 15 months | |
Foreign Currency Transaction [Abstract] | ||
Foreign currency transaction gains (losses) | ($1) | ($0.10) |
Derivatives Designated As Hedging Instruments | Prepaid Expense And Other Current Asset | ||
Derivative Instruments, Gain (Loss) | ||
Gross unrealized gain positions | 0.1 | |
Derivatives Designated As Hedging Instruments | Other Accrued Liabilities | ||
Derivative Instruments, Gain (Loss) | ||
Gross unrealized loss positions | ($3.30) |
Derivative_Instruments_And_Hed5
Derivative Instruments And Hedging Activities (Schedule Of Total Gross Notional Amounts, Presented By Currency) (Details) (USD $) | Jan. 31, 2015 | Nov. 01, 2014 |
In Thousands, unless otherwise specified | ||
Derivatives Designated As Hedging Instruments | ||
Derivative | ||
Total gross notional amounts, presented by currency | $58,564 | $80,957 |
Derivatives Designated As Hedging Instruments | Euro | ||
Derivative | ||
Total gross notional amounts, presented by currency | 9,741 | 14,404 |
Derivatives Designated As Hedging Instruments | British pound | ||
Derivative | ||
Total gross notional amounts, presented by currency | 7,887 | 11,168 |
Derivatives Designated As Hedging Instruments | Indian rupee | ||
Derivative | ||
Total gross notional amounts, presented by currency | 14,510 | 19,413 |
Derivatives Designated As Hedging Instruments | Chinese Yuan | ||
Derivative | ||
Total gross notional amounts, presented by currency | 7,638 | 10,406 |
Derivatives Designated As Hedging Instruments | Singapore dollar | ||
Derivative | ||
Total gross notional amounts, presented by currency | 6,583 | 9,242 |
Derivatives Designated As Hedging Instruments | Japanese yen | ||
Derivative | ||
Total gross notional amounts, presented by currency | 6,342 | 8,856 |
Derivatives Designated As Hedging Instruments | Swiss franc | ||
Derivative | ||
Total gross notional amounts, presented by currency | 5,863 | 7,468 |
Derivatives Not Designated As Hedging Instruments | ||
Derivative | ||
Total gross notional amounts, presented by currency | 23,502 | 34,091 |
Derivatives Not Designated As Hedging Instruments | Euro | ||
Derivative | ||
Total gross notional amounts, presented by currency | 12,985 | 19,200 |
Derivatives Not Designated As Hedging Instruments | British pound | ||
Derivative | ||
Total gross notional amounts, presented by currency | 10,517 | 14,891 |
Derivatives Not Designated As Hedging Instruments | Indian rupee | ||
Derivative | ||
Total gross notional amounts, presented by currency | 0 | 0 |
Derivatives Not Designated As Hedging Instruments | Chinese Yuan | ||
Derivative | ||
Total gross notional amounts, presented by currency | 0 | 0 |
Derivatives Not Designated As Hedging Instruments | Singapore dollar | ||
Derivative | ||
Total gross notional amounts, presented by currency | 0 | 0 |
Derivatives Not Designated As Hedging Instruments | Japanese yen | ||
Derivative | ||
Total gross notional amounts, presented by currency | 0 | 0 |
Derivatives Not Designated As Hedging Instruments | Swiss franc | ||
Derivative | ||
Total gross notional amounts, presented by currency | $0 | $0 |
StockBased_Compensation_StockB
Stock-Based Compensation (Stock-Based Compensation Expense Included In Line Items Of Consolidated Statements Of Operations) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Total stock-based compensation | $24,082 | $18,588 |
Cost of revenues | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Total stock-based compensation | 3,816 | 3,142 |
Research and development | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Total stock-based compensation | 4,933 | 4,336 |
Sales and marketing | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Total stock-based compensation | 9,843 | 6,765 |
General and administrative | ||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs | ||
Total stock-based compensation | $5,490 | $4,345 |
StockBased_Compensation_StockB1
Stock-Based Compensation (Stock-Based Compensation Expense By Grant Type) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Share-based Compensation Arrangement by Share-based Payment Award | ||
Total stock-based compensation | $24,082 | $18,588 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Total stock-based compensation | 1,356 | 1,281 |
Restricted stock units, including stock units with market conditions (altogether “RSUsâ€) | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Total stock-based compensation | 17,934 | 14,584 |
Employee stock purchase plan (“ESPPâ€) | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Total stock-based compensation | $4,792 | $2,723 |
StockBased_Compensation_StockB2
Stock-Based Compensation (Stock-Based Compensation, Unrecognized Compensation Expense And Weighted-Average Period) (Details) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Jan. 31, 2015 |
Stock options | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Unrecognized Compensation Expense | $5,791 |
Weighted-Average Period (in years) | 1 year 4 months 28 days |
Restricted stock units, including stock units with market conditions (altogether “RSUsâ€) | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Unrecognized Compensation Expense | 130,468 |
Weighted-Average Period (in years) | 2 years 0 months 14 days |
Employee stock purchase plan (“ESPPâ€) | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Unrecognized Compensation Expense | $12,005 |
Weighted-Average Period (in years) | 0 years 11 months 12 days |
StockBased_Compensation_Schedu
Stock-Based Compensation (Schedule of Share-based Compensation, Activity) (Details) (USD $) | 3 Months Ended | |
In Millions, except Share data in Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Stock options, Granted | 1,117 | 1,270 |
Stock options, Weighted-Average Grant Date Fair Value (dollars per share) | $3.09 | $3.25 |
Stock options, Exercises in Period, Total Intrinsic Value | $1 | $2.10 |
Restricted stock units, including stock units with market conditions (altogether “RSUsâ€) | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
RSUs, Granted | 3,641 | 2,885 |
RSUs, Weighted-Average Grant Date Fair Value (dollars per share) | $10.87 | $10.75 |
Stockholders_Equity_Stockholde
Stockholders' Equity Stockholders' Equity (Schedule of Dividends Payable) (Details) (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Dividends Payable [Line Items] | ||
Cash dividends declared per share | $0.04 | $0 |
Payments of Ordinary Dividends, Common Stock | $15,106 | $0 |
Common Stock | ||
Dividends Payable [Line Items] | ||
Dividends Payable, Date Declared | 24-Nov-14 | |
Cash dividends declared per share | $0.04 | $0 |
Dividends Payable, Date of Record | 10-Dec-14 | |
Payments of Ordinary Dividends, Common Stock | $15,106 | |
Dividends Payable, Date to be Paid | 2-Jan-15 |
Stockholders_Equity_Stockholde1
Stockholders' Equity Stockholders' Equity (Details) | 3 Months Ended |
Jan. 31, 2015 | |
Equity [Abstract] | |
Stockholders' Equity Note, Derivative Transactions Connected with Contingently Convertible Securities | In connection with the issuance of the 2020 Convertible Notes, the Company entered into convertible note hedge and warrant transactions with certain financial institutions with respect to its common stock. See Note 8, “Borrowings,†of the Notes to Condensed Consolidated Financial Statements for further discussion. |
Stockholders_Equity_Schedule_o
Stockholders' Equity (Schedule of Comprehensive Income (Loss) Tax Effects) (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 | ||
Unrealized gains (losses) on cash flow hedges, before tax | ||||
Change in unrealized gains and losses, foreign exchange contracts, before tax | ($2,179) | ($1,021) | ||
Net gains and losses reclassified into earnings, foreign exchange contracts, before tax | 683 | [1] | -33 | [1] |
Net unrealized losses on cash flow hedges, before tax | -1,496 | -1,054 | ||
Foreign currency translation adjustments, before tax | ||||
Foreign currency translation adjustments, before tax | -4,221 | -823 | ||
Total other comprehensive loss, before tax | -5,717 | -1,877 | ||
Unrealized gains (losses) on cash flow hedges, tax | ||||
Change in unrealized gains and losses, foreign exchange contracts, tax | 405 | 97 | ||
Net gains and losses reclassified into earnings, foreign exchange contracts, tax | -80 | [1] | 2 | [1] |
Net unrealized losses on cash flow hedges, tax | 325 | 99 | ||
Foreign currency translation adjustments, tax | ||||
Foreign currency translation adjustments, tax | 0 | 0 | ||
Total other comprehensive loss, tax | 325 | 99 | ||
Unrealized gains (losses) on cash flow hedges, net of tax | ||||
Change in unrealized gains and losses, foreign exchange contracts, net of tax | -1,774 | -924 | ||
Net gains and losses reclassified into earnings, foreign exchange contracts, net of tax | 603 | [1] | -31 | [1] |
Net unrealized losses on cash flow hedges, net of tax | -1,171 | -955 | ||
Foreign currency translation adjustments, net of tax | ||||
Foreign currency translation adjustments, net of tax | -4,221 | -823 | ||
Total other comprehensive loss, net of tax | ($5,392) | ($1,778) | ||
[1] | For Condensed Consolidated Statements of Income classification of amounts reclassified from accumulated other comprehensive loss, see Note 10, “Derivative Instruments and Hedging Activities,†of the Notes to Condensed Consolidated Financial Statements. |
Stockholders_Equity_Schedule_o1
Stockholders' Equity (Schedule of Accumulated Other Comprehensive Income (Loss)) (Details) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 | Jan. 31, 2015 | Jan. 25, 2014 |
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | ($18,814) | ($13,444) | ($24,206) | ($15,222) |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | ||||
Change in unrealized gains and losses | -5,995 | -1,747 | ||
Net gains and losses reclassified into earnings | 603 | -31 | ||
Net current-period other comprehensive loss | -5,392 | -1,778 | ||
Gains (Losses) on Cash Flow Hedges | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | -1,907 | 267 | -3,078 | -688 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | ||||
Change in unrealized gains and losses | -1,774 | -924 | ||
Net gains and losses reclassified into earnings | 603 | -31 | ||
Net current-period other comprehensive loss | -1,171 | -955 | ||
Foreign Currency Translation Adjustments | ||||
Accumulated Other Comprehensive Income (Loss) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, Beginning Balance | -16,907 | -13,711 | -21,128 | -14,534 |
Reclassification from Accumulated Other Comprehensive Income, Current Period, Net of Tax | ||||
Change in unrealized gains and losses | -4,221 | -823 | ||
Net gains and losses reclassified into earnings | 0 | 0 | ||
Net current-period other comprehensive loss | ($4,221) | ($823) |
Income_Taxes_Narrative_Details
Income Taxes (Narrative) (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Jan. 31, 2015 |
Current Income Tax Expense (Benefit), Continuing Operations | |
U.S. federal statutory tax rate | 35.00% |
Income Tax Contingency | |
Amount of unrecognized tax benefits that could affect the effect tax rate | $81 |
Lower range of estimated potential decreases in underlying uncertain tax positions | 0 |
Upper range of estimated potential decreases in underlying uncertain tax positions | $4 |
Segment_Information_Schedule_O
Segment Information (Schedule Of Financial Information By Reportable Segment) (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 |
Segment Reporting Information | ||
Net revenues | $576,239 | $564,535 |
Cost of revenues | 186,556 | 191,865 |
Gross margin | 389,683 | 372,670 |
SAN Products | ||
Segment Reporting Information | ||
Net revenues | 353,399 | 355,456 |
Cost of revenues | 85,725 | 92,941 |
Gross margin | 267,674 | 262,515 |
Internet Protocol (“IPâ€) Networking Products | ||
Segment Reporting Information | ||
Net revenues | 132,839 | 119,749 |
Cost of revenues | 64,201 | 60,686 |
Gross margin | 68,638 | 59,063 |
Global Services | ||
Segment Reporting Information | ||
Net revenues | 90,001 | 89,330 |
Cost of revenues | 36,630 | 38,238 |
Gross margin | $53,371 | $51,092 |
Segment_Information_Narrative_
Segment Information Narrative (Details) | 3 Months Ended |
Jan. 31, 2015 | |
segments | |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
Number of reportable operating segments | 3 |
Net_Income_Per_Share_Schedule_
Net Income Per Share (Schedule Of Calculation Of Basic And Diluted Net Income (Loss) Per Share) (Details) (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Jan. 31, 2015 | Jan. 25, 2014 | ||
Earnings Per Share, Basic | ||||
Net income | $87,267 | $80,884 | ||
Weighted-average shares used in computing basic net income per share | 428,536 | 440,573 | ||
Net income per share—basic | $0.20 | $0.18 | ||
Earnings Per Share, Diluted | ||||
Net income | $87,267 | $80,884 | ||
Weighted-average shares used in computing diluted net income per share | 439,156 | 453,549 | ||
Net income per share—diluted | $0.20 | $0.18 | ||
Weighted Average Number of Shares Outstanding Reconciliation | ||||
Weighted-average shares used in computing basic net income per share | 428,536 | 440,573 | ||
Dilutive potential common shares in the form of stock options | 1,734 | 2,620 | ||
Dilutive potential common shares in the form of other share-based awards | 8,886 | 10,356 | ||
Weighted-average shares used in computing diluted net income per share | 439,156 | 453,549 | ||
Warrant | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive potential common shares | 7,140 | [1],[2] | 0 | [1],[2] |
Stock options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive potential common shares | 577 | [1] | 3,015 | [1] |
Other share-based awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Antidilutive potential common shares | 0 | [1] | 462 | [1] |
Convertible Senior Unsecured 2020 Notes | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share | ||||
Debt Instrument, Convertible, Conversion Price | $15.93 | |||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $20.65 | |||
[1] | These amounts are excluded from the computation of diluted net income per share. | |||
[2] | In connection with the issuance of the 2020 Convertible Notes, the Company entered into convertible note hedge and warrant transactions as described in Note 8, “Borrowings.†The 2020 Convertible Notes have no impact on diluted earnings per share until the average quarterly price of the Company’s common stock exceeds the conversion price of $15.93 per share. If the common stock price exceeds this conversion price, prior to conversion, the Company will calculate the effect of the additional shares that may be issued using the treasury stock method. If the average price of the Company’s common stock exceeds $20.65 per share for a quarterly period, the Company’s weighted-average shares used in computing diluted net income per share will be impacted by the effect of the additional potential shares that may be issued related to the warrants using the treasury stock method. The convertible note hedge is not considered for purposes of the diluted earnings per share calculation, as its effect would be antidilutive. |
Guarantor_And_NonGuarantor_Sub1
Guarantor And Non-Guarantor Subsidiaries (Narrative) (Details) (USD $) | 3 Months Ended | ||
In Millions, unless otherwise specified | Jan. 31, 2015 | Jan. 20, 2010 | Jan. 22, 2013 |
Guarantor And Non-Guarantor Subsidiaries [Abstract] | |||
Description of Guarantees Given by Parent Company | On January 20, 2010, the Company issued $300.0 million in aggregate principal amount of the 6.625% senior secured notes due 2018 (the “2018 Notesâ€) and $300.0 million in aggregate principal amount of the 2020 Notes (together with the 2018 Notes, the “Senior Secured Notesâ€) pursuant to separate indentures between the Company, certain domestic subsidiaries of the Company, and Wells Fargo Bank, National Association, as the trustee (the “2020 Indenture†and “2018 Indenture,†respectively). In addition, on January 22, 2013, the Company issued $300.0 million in aggregate principal amount of the 2023 Notes. The Company’s obligations under the Senior Secured Notes and the 2023 Notes were previously guaranteed by certain of the Company’s domestic subsidiaries (the “Subsidiary Guarantorsâ€). Each of the Subsidiary Guarantors is 100% owned by the Company and all guarantees were joint and several. Neither the Senior Secured Notes nor the 2023 Notes were guaranteed by certain of the Company’s domestic subsidiaries or any of the Company’s foreign subsidiaries (the “Non-Guarantor Subsidiariesâ€). The Company determined that the circumstances under which the subsidiary guarantees may be released were customary under applicable SEC guidance, and, as such, the Company previously provided consolidated financial statements in reliance on Item 3-10 of Regulation S-X. The guarantees of the 2018 Notes and 2020 Notes were released on January 22, 2013, and January 14, 2015, respectively, upon the discharge of the 2018 Indenture and 2020 Indenture. The guarantees of the 2023 Notes were released on January 14, 2015, upon termination of the Senior Secured Credit Facility and discharge of the 2020 Indenture. As a result, all guarantees have been released prior to January 31, 2015, and the Company has ceased presenting condensed consolidated financial statements for the parent company, the former Subsidiary Guarantors, and Non-Guarantor Subsidiaries effective in the first fiscal quarter in 2015. | ||
Senior Secured 2018 Notes | |||
Debt Instrument | |||
Debt Instrument, Face Amount | $300 | ||
Senior Secured 2020 Notes | |||
Debt Instrument | |||
Debt Instrument, Face Amount | 300 | ||
Senior Unsecured 2023 Notes | |||
Debt Instrument | |||
Debt Instrument, Face Amount | $300 |
Subsequent_Events_Subsequent_E1
Subsequent Events Subsequent Events (Details) (Senior Secured 2020 Notes, USD $) | 1 Months Ended | |||
In Millions, unless otherwise specified | Mar. 06, 2015 | Jan. 14, 2015 | Feb. 13, 2015 | Jan. 31, 2015 |
Subsequent Event | ||||
Repayment of principal amount | $300 | |||
Extinguishment of 2020 Notes | ||||
Subsequent Event | ||||
Irrevocable deposit | 311.9 | |||
Subsequent Event, Date | 13-Feb-15 | |||
Subsequent Event, Description | During the first quarter of fiscal year 2015, the Company irrevocably deposited $311.9 million with the trustee for redemption of the 2020 Notes as described in Note 8, “Borrowings,†of the Notes to Condensed Consolidated Financial Statements. On February 13, 2015, the trustee redeemed the 2020 Notes using the deposited amount (less the amount used for the January 15, 2015 interest payment), extinguishing the Company’s $300.0 million liability in relation to the principal amount of the 2020 Notes. | |||
Repayment of principal amount | $300 |