Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Billions, except Share data, unless otherwise specified | Feb. 28, 2015 | Apr. 21, 2015 | Aug. 29, 2014 |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 28-Feb-15 | ||
Document Fiscal Year Focus | 2015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | RHT | ||
Entity Registrant Name | RED HAT INC | ||
Entity Central Index Key | 1087423 | ||
Current Fiscal Year End Date | -26 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 183,318,650 | ||
Entity Public Float | $9.50 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $1,047,473 | $646,742 |
Investments in debt securities, short-term | 215,254 | 335,387 |
Accounts receivable, net of allowances for doubtful accounts of $2,247 and $1,986, respectively | 468,021 | 360,594 |
Deferred tax assets, net | 86,796 | 108,264 |
Prepaid expenses | 150,715 | 118,387 |
Other current assets | 1,980 | 1,808 |
Total current assets | 1,970,239 | 1,571,182 |
Property and equipment, net of accumulated depreciation and amortization of $190,114 and $209,295, respectively | 172,151 | 173,917 |
Goodwill | 927,060 | 687,430 |
Identifiable intangibles, net | 134,276 | 133,399 |
Investments in debt securities, long-term | 546,016 | 505,300 |
Other assets, net | 53,243 | 35,391 |
Total assets | 3,802,985 | 3,106,619 |
Current liabilities: | ||
Accounts payable and accrued expenses | 237,733 | 179,468 |
Deferred revenue | 1,095,115 | 966,832 |
Other current obligations | 1,844 | 1,786 |
Total current liabilities | 1,334,692 | 1,148,086 |
Long-term deferred revenue | 387,213 | 322,365 |
Convertible notes | 715,402 | |
Other long-term obligations | 77,340 | 85,003 |
Commitments and contingencies (NOTES 14 and 15) | ||
Stockholders' equity: | ||
Preferred stock, 5,000,000 shares authorized, none outstanding | ||
Common stock, $0.0001 per share par value, 300,000,000 shares authorized, 233,061,964 and 230,915,589 shares issued, 183,551,078 and 189,712,211 shares outstanding at February 28, 2015 and February 28, 2014, respectively | 23 | 23 |
Additional paid-in capital | 1,963,851 | 1,891,848 |
Retained earnings | 900,373 | 720,172 |
Treasury stock at cost, 49,510,886 and 41,203,378 shares at February 28, 2015 and February 28, 2014, respectively | -1,515,288 | -1,056,419 |
Accumulated other comprehensive loss | -60,621 | -4,459 |
Total stockholders' equity | 1,288,338 | 1,551,165 |
Total liabilities and stockholders' equity | $3,802,985 | $3,106,619 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, except Share data, unless otherwise specified | ||
Accounts receivable, allowances for doubtful accounts | $2,247 | $1,986 |
Property and equipment, accumulated depreciation and amortization | $190,114 | $209,295 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, outstanding | 0 | 0 |
Common stock, per share par value | $0.00 | $0.00 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares issued | 233,061,964 | 230,915,589 |
Common stock, shares outstanding | 183,551,078 | 189,712,211 |
Treasury stock, shares | 49,510,886 | 41,203,378 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Revenue: | |||
Subscriptions | $1,561,234 | $1,336,771 | $1,148,341 |
Training and services | 228,255 | 197,844 | 180,476 |
Total subscription and training and services revenue | 1,789,489 | 1,534,615 | 1,328,817 |
Cost of subscription and training and services revenue: | |||
Cost of subscriptions | 112,856 | 97,100 | 80,340 |
Cost of training and services | 160,343 | 135,500 | 120,260 |
Total cost of subscription and training and services revenue | 273,199 | 232,600 | 200,600 |
Gross profit | 1,516,290 | 1,302,015 | 1,128,217 |
Operating expense: | |||
Sales and marketing | 728,387 | 597,885 | 514,554 |
Research and development | 367,856 | 317,263 | 263,150 |
General and administrative | 170,053 | 152,407 | 146,333 |
Facility exit costs | 2,171 | 3,142 | |
Total operating expense | 1,266,296 | 1,069,726 | 927,179 |
Income from operations | 249,994 | 232,289 | 201,038 |
Interest income | 8,336 | 6,645 | 8,245 |
Interest expense | 9,394 | 160 | 267 |
Other income (expense), net | 6,562 | 774 | 736 |
Income before provision for income taxes | 255,498 | 239,548 | 209,752 |
Provision for income taxes | 75,297 | 61,256 | 59,548 |
Net income | $180,201 | $178,292 | $150,204 |
Basic net income per common share | $0.97 | $0.94 | $0.78 |
Diluted net income per common share | $0.95 | $0.93 | $0.77 |
Weighted average shares outstanding | |||
Basic | 186,529 | 189,920 | 193,147 |
Diluted | 189,246 | 192,036 | 195,804 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Net income | $180,201 | $178,292 | $150,204 |
Other comprehensive income (loss): | |||
Change in foreign currency translation adjustment | -56,163 | 3,945 | -2,810 |
Available-for-sale securities: | |||
Unrealized gain (loss) on available-for-sale securities during the period | -148 | -466 | 2,092 |
Reclassification for gain realized on available-for-sale securities, reported in Other income (expense), net | -152 | -350 | -797 |
Tax benefit (expense) | 301 | 379 | -500 |
Net change in available-for-sale securities (net of tax) | 1 | -437 | 795 |
Total other comprehensive income (loss) | -56,162 | 3,508 | -2,015 |
Comprehensive income | $124,039 | $181,800 | $148,189 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders' Equity (USD $) | Total | Common Stock | Additional Paid-In Capital | Retained Earnings | Treasury Stock | Accumulated Other Comprehensive Income (Loss) |
In Thousands | ||||||
Balance at Feb. 29, 2012 | $1,398,817 | $23 | $1,709,082 | $391,676 | ($696,012) | ($5,952) |
Balance (in shares) at Feb. 29, 2012 | 226,553 | |||||
Net income | 150,204 | 150,204 | ||||
Other comprehensive income (loss), net of tax | -2,015 | -2,015 | ||||
Vest and exercise of share-based awards (in shares) | 2,658 | |||||
Vest and exercise of share-based awards | 11,478 | 11,478 | ||||
Common stock repurchase | -120,662 | -120,662 | ||||
Share-based compensation expense | 98,698 | 98,698 | ||||
Tax benefits related to share-based awards | 33,625 | 33,625 | ||||
Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards | -49,984 | -49,984 | ||||
Balance at Feb. 28, 2013 | 1,520,161 | 23 | 1,802,899 | 541,880 | -816,674 | -7,967 |
Balance (in shares) at Feb. 28, 2013 | 229,211 | |||||
Net income | 178,292 | 178,292 | ||||
Other comprehensive income (loss), net of tax | 3,508 | 3,508 | ||||
Vest and exercise of share-based awards (in shares) | 1,705 | |||||
Vest and exercise of share-based awards | 2,122 | 2,122 | ||||
Common stock repurchase | -239,363 | -239,363 | ||||
Share-based compensation expense | 113,774 | 113,774 | ||||
Tax benefits related to share-based awards | 10,073 | 10,073 | ||||
Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards | -37,402 | -37,402 | ||||
Other | 382 | -382 | ||||
Balance at Feb. 28, 2014 | 1,551,165 | 23 | 1,891,848 | 720,172 | -1,056,419 | -4,459 |
Balance (in shares) at Feb. 28, 2014 | 230,916 | |||||
Net income | 180,201 | 180,201 | ||||
Other comprehensive income (loss), net of tax | -56,162 | -56,162 | ||||
Vest and exercise of share-based awards (in shares) | 2,146 | |||||
Vest and exercise of share-based awards | 2,434 | 2,434 | ||||
Common stock repurchase | -535,062 | -75,000 | -460,062 | |||
Share-based compensation expense | 135,232 | 135,232 | ||||
Assumed employee share-based awards from acquisitions | 895 | 895 | ||||
Tax benefits related to share-based awards | 6,436 | 6,436 | ||||
Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards | -43,462 | -43,462 | ||||
Equity component of convertible notes | 96,890 | 96,890 | ||||
Equity component of convertible notes issuance cost | -1,833 | -1,833 | ||||
Purchase of convertible note hedges | -148,040 | -148,040 | ||||
Proceeds from issuance of warrants | 79,776 | 79,776 | ||||
Deferred taxes related to convertible notes | 19,868 | 19,868 | ||||
Other | -1,193 | 1,193 | ||||
Balance at Feb. 28, 2015 | $1,288,338 | $23 | $1,963,851 | $900,373 | ($1,515,288) | ($60,621) |
Balance (in shares) at Feb. 28, 2015 | 233,062 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Cash flows from operating activities: | |||
Net income | $180,201 | $178,292 | $150,204 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 76,263 | 74,405 | 62,341 |
Amortization of debt discount and transaction costs | 8,227 | ||
Deferred income taxes | 23,517 | 13,776 | 5,630 |
Share-based compensation expense | 135,232 | 113,774 | 98,698 |
Net amortization of bond premium on debt securities available for sale | 9,314 | 8,697 | 6,889 |
Other | -3,474 | 1,411 | -2,626 |
Changes in operating assets and liabilities net of effects of acquisitions: | |||
Accounts receivable | -121,536 | -61,785 | -46,913 |
Prepaid expenses | -40,741 | -25,122 | -14,726 |
Accounts payable and accrued expenses | 71,040 | 28,436 | 40,196 |
Deferred revenue | 282,693 | 205,357 | 162,574 |
Other | 2,059 | 3,339 | 3,030 |
Net cash provided by operating activities | 622,795 | 540,580 | 465,297 |
Cash flows from investing activities: | |||
Purchase of investment in debt securities available for sale | -568,551 | -772,741 | -875,428 |
Proceeds from sales and maturities of investment in debt securities available for sale | 580,158 | 764,122 | 741,301 |
Acquisitions of businesses, net of cash acquired | -296,121 | -135,501 | |
Purchase of developed software and other intangible assets | -6,123 | -17,972 | -34,367 |
Purchase of property and equipment | -45,648 | -79,587 | -85,671 |
Other | 11,282 | -2,084 | 617 |
Net cash used in investing activities | -325,003 | -108,262 | -389,049 |
Cash flows from financing activities: | |||
Excess tax benefits from share-based payment arrangements | 5,607 | 12,837 | 34,219 |
Proceeds from exercise of common stock options | 2,434 | 2,122 | 11,478 |
Purchase of treasury stock | -535,062 | -239,363 | -120,662 |
Payments related to settlement of employee shared-based awards | -43,462 | -37,402 | -49,984 |
Proceeds from issuance of convertible notes, net of issuance costs | 789,769 | ||
Purchase of convertible note hedges | -148,040 | ||
Proceeds from issuance of warrants | 79,776 | ||
Payments on other borrowings | -2,782 | -1,304 | -1,016 |
Net cash provided by (used in) financing activities | 148,240 | -263,110 | -125,965 |
Effect of foreign currency exchange rates on cash and cash equivalents | -45,301 | -9,550 | -12,416 |
Net increase (decrease) in cash and cash equivalents | 400,731 | 159,658 | -62,133 |
Cash and cash equivalents at beginning of year | 646,742 | 487,084 | 549,217 |
Cash and cash equivalents at end of year | 1,047,473 | 646,742 | 487,084 |
Cash paid during the year for: | |||
Interest | 52 | 43 | 50 |
Income taxes | 33,701 | 34,736 | 14,863 |
Non-cash investing and financing activities: | |||
Fixed assets acquired under capital leases | $1,818 | $1,560 | $1,137 |
Company
Company | 12 Months Ended |
Feb. 28, 2015 | |
Company | NOTE 1—Company |
Red Hat, Inc., incorporated in Delaware, together with its subsidiaries (“Red Hat” or the “Company”) is a leading global provider of open source software solutions, using a community-powered approach to develop and offer reliable and high-performing operating system, virtualization, middleware, storage and cloud technologies. | |
Open source software is an alternative to proprietary software and represents a different model for the development and licensing of commercial software code than that typically used for proprietary software. Because open source software code is often freely shared, there are customarily no licensing fees for the use of open source software. Therefore, the Company does not recognize revenue from the licensing of the code itself. The Company provides value to its customers through the development, aggregation, integration, testing, certification, delivery, maintenance, enhancement and support of its Red Hat technologies, and by providing a level of performance, reliability, scalability, flexibility, stability and security for the technologies the Company packages and distributes. Moreover, because communities of developers not employed by the Company assist with the creation of the Company’s open source offerings, opportunities for further innovation of the Company’s offerings are supplemented by these communities. | |
The Company derives its revenue and generates cash from customers primarily from two sources: (i) subscription revenue and (ii) training and services revenue. These arrangements typically involve subscriptions to Red Hat technologies. The arrangements with the Company’s customers that produce this revenue and cash are explained in further detail in NOTE 2—Summary of Significant Accounting Policies. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended |
Feb. 28, 2015 | |
Summary of Significant Accounting Policies | NOTE 2—Summary of Significant Accounting Policies |
Basis of presentation | |
The accompanying Consolidated Financial Statements include the accounts of the Company and all of its wholly-owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation. There are no significant foreign exchange restrictions on the Company’s foreign subsidiaries. | |
Use of estimates | |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from such estimates. | |
Revenue recognition | |
The Company establishes persuasive evidence of a sales arrangement for each type of revenue transaction based on either a signed contract with the end customer, a click-through contract on the Company’s website whereby the customer agrees to the Company’s standard subscription terms, signed or click-through distribution contracts with original equipment manufacturers (“OEMs”) and other resellers, or, in the case of individual training seats, through receipt of payment which indicates acceptance of the Company’s training agreement terms. | |
Subscription revenue | |
Subscription revenue is comprised of direct and indirect sales of subscriptions relating to Red Hat technologies. Accounts receivable and deferred revenue are recorded at the time a customer enters into a binding subscription agreement for the purchase of a subscription, subscription services are made available to the customer and the customer is billed. The deferred revenue amount is recognized as revenue ratably over the life of the subscription. Red Hat technologies are generally offered with either one or three-year base subscription periods; the majority of the Company’s subscriptions have one-year terms. Under these subscription agreements, renewal rates are generally specified for one or three-year renewal terms. Subscriptions generally entitle the end user to the technology itself and post-contract customer support, generally consisting of varying levels of support services as well as access to security errata, fixes, functionality enhancements to the technology and upgrades to new versions of the technologies, each on a when-and-if available basis, during the term of the subscription. The Company sells its offerings through two principal channels: (1) direct, which includes sales by the Company’s sales force as well as web store sales, and (2) indirect, which includes cloud service providers, distributors, value added resellers, systems integrators and OEMs. The Company recognizes revenue from the sale of Red Hat technologies ratably over the period of the subscription beginning on the commencement date of the subscription agreement. | |
Subscription arrangements with large enterprise customers often have contracts with multiple elements (e.g., software technology, support, training, consulting and other services). The Company allocates revenue to each element of the arrangement based on vendor-specific objective evidence of each element’s fair value when the Company can demonstrate sufficient evidence of the fair value of at least those elements that are undelivered. The fair value of each element in multiple element arrangements is created by either (i) providing the customer with the ability during the term of the arrangement to renew that element at the same rate paid for the element included in the initial term of the agreement or (ii) selling the element on a stand-alone basis. | |
Training and services revenue | |
Training and services revenue is comprised of revenue for consulting, engineering and customer training and education services. Consulting services consist of time-based arrangements, and revenue is recognized as these services are performed. Engineering services represent revenue earned under fixed fee arrangements with the Company’s OEM partners and other customers to provide for significant modification and customization of Red Hat technologies. The Company recognizes revenue for these fixed fee engineering services using the percentage of completion basis of accounting, provided the Company has the ability to make reliable estimates of progress towards completion, the fee for such services is fixed or determinable and collection of the resulting receivable is probable. Under the percentage of completion method, earnings under the contract are recognized based on the progress toward completion as estimated using the ratio of labor hours incurred to total expected project hours. Changes in estimates are recognized in the period in which they are known. Revenue for customer training and education services is recognized on the dates the services are complete. | |
Deferred selling costs | |
Deferred commissions are the incremental costs that are directly associated with non-cancelable subscription contracts with customers and consist of sales commissions paid to the Company’s sales force. The commissions are deferred and amortized over a period that approximates the period of the subscription term. The commission payments are paid in full subsequent to the month in which the customer’s service commences. The deferred commission amounts are recoverable through the future revenue streams under the non-cancelable customer contracts. In addition, the Company has the ability and intent under the commission plans with its sales force to recover commissions previously paid to its sales force in the event that customers breach the terms of their subscription agreements and do not fully pay for their subscription agreements. Deferred commissions are included in prepaid expenses on the accompanying Consolidated Balance Sheets. Amortization of deferred commissions is included in sales and marketing expense in the accompanying Consolidated Statements of Operations. | |
Goodwill and other long-lived assets | |
Goodwill | |
The Company tests goodwill for impairment annually. For the years ended February 28, 2015 and February 28, 2014, the Company applied its test for goodwill impairment as permitted by ASU 2011-08, which allows the Company to first assess qualitative factors to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying value. The outcome of these qualitative tests determines whether it is necessary for a company to perform the two-step goodwill impairment test as required in years prior to the adoption of ASU 2011-08. | |
After considering such qualitative factors as macroeconomic conditions, actual or anticipated changes to cost factors (for example, selling and delivery), overall financial performance and other Company-specific factors, such as potential changes in strategy, the Company determined that it was not more likely than not that any impairment to goodwill had occurred during the years ended February 28, 2015 and February 28, 2014. Consequently, the Company was not required to perform the remaining two-step quantitative goodwill impairment test. | |
Other long-lived assets | |
The Company evaluates the recoverability of its property and equipment and other long-lived assets whenever events or changes in circumstances indicate that an impairment may have occurred. An impairment loss is recognized when the net book value of such assets exceeds the estimated future undiscounted cash flows attributable to the assets or the business to which the assets relate. Impairment losses, if any, are measured as the amount by which the carrying value exceeds the fair value of the assets. | |
See NOTE 7—Other Assets, Net for further discussion of impairment losses on long-lived assets for the years ended February 28, 2015, February 28, 2014 and February 28, 2013. | |
Cash and cash equivalents | |
The Company considers highly liquid investments purchased with a maturity period of three months or less at the date of purchase to be cash equivalents. | |
Accounts receivable and allowance for doubtful accounts | |
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on historical write-off experience. The Company reviews its allowance for doubtful accounts monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. All other balances are reviewed on a pooled basis by type of receivable. Account balances are charged off against the allowance when the Company determines it is probable the receivable will not be recovered. The Company does not have off-balance sheet credit exposure related to its customers. See NOTE 4—Accounts Receivable for further discussion on accounts receivable balances. | |
Fair value measurements | |
Fair value is defined as the exchange price that would be received for the purchase of an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for such asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value should maximize the use of observable inputs and minimize the use of unobservable inputs. To measure fair value, the Company uses the following fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable: | |
Level 1—Quoted prices in active markets for identical assets or liabilities. | |
Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |
Level 3—Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. | |
The Company’s investments are comprised primarily of debt securities that are classified as available for sale and recorded at their fair market values. Liquid investments with effective maturities of three months or less at the date of purchase are classified as cash equivalents. Investments with remaining effective maturities of twelve months or less from the balance sheet date are classified as short-term investments. Investments with remaining effective maturities of more than twelve months from the balance sheet date are classified as long-term investments. The Company’s Level 1 financial instruments are valued using quoted prices in active markets for identical instruments. The Company’s Level 2 financial instruments, including derivative instruments, are valued using quoted prices for identical instruments in less active markets or using other observable market inputs for comparable instruments. | |
Unrealized gains and temporary losses on investments classified as available for sale are included within accumulated other comprehensive income, net of any related tax effect. Upon realization, such amounts are reclassified from accumulated other comprehensive income to other income, net. Realized gains and losses and other than temporary impairments, if any, are reflected in the statements of operations as other income, net. The Company does not recognize changes in the fair value of its investments in income unless a decline in value is considered other than temporary. The vast majority of the Company’s investments are priced by pricing vendors. These pricing vendors use the most recent observable market information in pricing these securities or, if specific prices are not available for these securities, use other observable inputs. In the event observable inputs are not available, the Company assesses other factors to determine the security’s market value, including broker quotes or model valuations. Independent price verifications of all holdings are performed by pricing vendors which are then reviewed by the Company. In the event a price fails a pre-established tolerance check, it is researched so that the Company can assess the cause of the variance to determine what the Company believes is the appropriate fair market value. See NOTE 18—Assets and Liabilities Measured at Fair Value on a Recurring Basis for further discussion on fair value measurements. | |
The Company minimizes its credit risk associated with investments by investing primarily in investment grade, liquid securities. The Company’s policy is designed to limit exposures to any one issuer depending on credit quality. Periodic evaluations of the relative credit standing of those issuers are considered in the Company’s investment strategy. | |
Internal use software | |
The Company capitalizes costs related to the development of internal use software for its website, enterprise resource planning system and systems management applications. The Company amortizes the costs of computer software developed for internal use on a straight-line basis over an estimated useful life of five years. The carrying value of internal use software is included in property and equipment on the Company’s Consolidated Balance Sheets. | |
Capitalized software costs | |
Capitalization of software development costs for products to be sold to third parties begins upon the establishment of technological feasibility and ceases when the product is available for general release. As a result of the Company’s practice of releasing source code that it has developed on a weekly basis for unrestricted download on the Internet, there is generally no passage of time between achievement of technological feasibility and the availability of the Company’s product for general release. Therefore, at February 28, 2015 and February 28, 2014, the Company had no internally developed capitalized software costs for products to be sold to third parties. | |
Property and equipment | |
Property and equipment is primarily comprised of furniture, computer equipment, computer software and leasehold improvements, which are recorded at cost and depreciated or amortized using the straight-line method over their estimated useful lives as follows: furniture and fixtures, seven years; computer equipment, three to four years; computer software, five years; leasehold improvements, over the lesser of the estimated remaining useful life of the asset or the remaining term of the lease. Expenditures for maintenance and repairs are charged to operations as incurred; major expenditures for renewals and betterments are capitalized and depreciated. Property and equipment acquired under capital leases are depreciated over the lesser of the estimated remaining useful life of the asset or the remaining term of the lease. | |
Share-based compensation | |
The Company measures share-based compensation cost at grant date, based on the estimated fair value of the award and recognizes the cost over the employee requisite service period typically on a straight-line basis, net of estimated forfeitures. The Company estimates the fair value of stock options using the Black-Scholes-Merton valuation model. The fair value of nonvested share awards, nonvested share units and performance share units (PSUs”) are measured at their underlying closing share price on the date of grant. The Company’s share-based compensation is described further in NOTE 13—Share-based Awards. | |
Sales and marketing expenses | |
Sales and marketing expenses consist of costs, including salaries, sales commissions and related expenses, such as travel, of all personnel involved in the sales and marketing process. Sales and marketing expenses also include costs of advertising, sales lead generation programs, cooperative marketing arrangements and trade shows. Payments made to resellers or other customers are recognized as a reduction of revenue unless the Company (i) receives an identifiable benefit (goods or services) in exchange for such payments that is sufficiently separable from the purchase of the Company’s products and (ii) the Company can reasonably estimate the fair value of the benefit identified. Advertising costs are expensed as incurred. | |
Advertising expense totaled $62.6 million, $53.4 million and $42.7 million for the years ended February 28, 2015, February 28, 2014 and February 28, 2013, respectively. | |
Research and development expenses | |
Research and development expenses include all direct costs, primarily salaries for Company personnel and outside consultants, related to the development of new software products, significant enhancements to existing software products, and the portion of costs of development of internal use software required to be expensed. Research and development costs are charged to operations as incurred with the exception of those software development costs that may qualify for capitalization. | |
Income taxes | |
The Company accounts for income taxes using the liability method in which deferred tax assets or liabilities are recognized for the temporary differences between financial reporting and tax bases of the Company’s assets and liabilities and for tax carryforwards at enacted statutory tax rates in effect for the years in which the differences are expected to reverse. | |
The Company continues to assess the realizability of its deferred tax assets, which primarily consist of share-based compensation expense deductions, tax credit carryforwards and deferred revenue. In assessing the realizability of these deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The Company continues to maintain a valuation allowance against its deferred tax assets with respect to certain foreign net operating loss (“NOL”) carryforwards. | |
With respect to foreign earnings, it is the Company’s policy to invest the earnings of foreign subsidiaries indefinitely outside the U.S. From time to time, however, the Company may remit a portion of these earnings to the extent it incurs no additional U.S. tax and it is otherwise feasible. | |
Because tax laws are complex and subject to different interpretations, significant judgment is required. As a result, the Company makes certain estimates and assumptions in (i) calculating its income tax expense, deferred tax assets and deferred tax liabilities, (ii) determining any valuation allowance recorded against deferred tax assets and (iii) evaluating the amount of unrecognized tax benefits, as well as the interest and penalties related to such uncertain tax positions. The Company’s estimates and assumptions may differ significantly from tax benefits ultimately realized. The Company’s income tax expense and deferred taxes are described further in NOTE 11—Income Taxes. | |
Foreign currency translation | |
The Euro has been determined to be the primary functional currency for the Company’s European operations and local currencies have been determined to be the functional currencies for the Company’s Asia Pacific and Latin American operations, with the exception of the Company’s operations in Mexico, where the functional currency is the U.S. dollar. Foreign exchange gains and losses, which result from the process of remeasuring foreign currency transactions into the appropriate functional currency, are included in other income, net in the Company’s Consolidated Statements of Operations. | |
The impact of changes in foreign currency exchange rates resulting from the translation of foreign currency financial statements into U.S. dollars for financial reporting purposes is included in other comprehensive income, which is a separate component of stockholders’ equity. Assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Income and expense items are translated at average rates for the period. | |
Customers and credit risk | |
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash, cash equivalents, investments and trade receivables. The Company primarily places its cash, cash equivalents and investments with high-credit quality financial institutions which invest predominantly in U.S. government instruments, investment grade corporate bonds and certificates of deposit guaranteed by banks which are members of the Federal Deposit Insurance Corporation. Cash deposits are primarily in financial institutions in the U.S. and the United Kingdom. However, cash for monthly operating costs of international operations are deposited in banks outside the U.S. | |
The Company performs credit evaluations to reduce credit risk and generally requires no collateral from its customers. Management estimates the allowance for uncollectible accounts based on their historical experience and credit evaluation. The Company’s standard credit terms are net 30 days in North America, net 30 to 45 days in EMEA (Europe, Middle East and Africa) and Latin America, and range from net 30 to net 60 days in Asia Pacific. | |
Net income per common share | |
The Company computes basic net income per common share by dividing net income available to common stockholders by the weighted average number of common shares outstanding. Diluted net income per common share is computed by dividing net income by the weighted average number of common shares and dilutive potential common share equivalents then outstanding. Potential common share equivalents consist of shares issuable upon the exercise of stock options or vesting of share-based awards. | |
With respect to the Company’s 0.25% convertible senior notes due 2019 (the “convertible notes”), the Company has the option to pay cash or deliver, as the case may be, either cash, shares of its common stock or combination of cash and shares of its common stock for the aggregate amount due upon conversion of the convertible notes. The Company’s intent is to settle the principal amount of the convertible notes in cash upon conversion. As a result, upon conversion of the convertible notes, only the amounts payable in excess of the principal amounts of the convertible notes would be considered in diluted earnings per share under the treasury stock method. See NOTE 22—Convertible Notes to the Company’s Consolidated Financial Statements for detailed information on the convertible notes. | |
Segment reporting | |
The Company is organized primarily on the basis of three geographic business units: the Americas (U.S., Latin America and Canada), EMEA (Europe, Middle East and Africa) and Asia Pacific. These business units are aggregated into one reportable segment due to the similarity in nature of products and services provided, financial performance economic characteristics (e.g., revenue growth and gross margin), methods of production and distribution and customer classes (e.g., cloud service providers, distributors, resellers and enterprise). | |
The Company has offices in more than 85 locations around the world. The Company manages its international business on an Americas-wide, EMEA-wide and Asia Pacific-wide basis. See NOTE 20—Segment Reporting for further discussion. | |
Recent accounting pronouncements | |
In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs (“ASU 2015-03”). The FASB issued ASU 2015-03 to simplify the presentation of debt issuance costs related to a recognized debt liability to present the debt issuance costs as a direct deduction from the carrying value of the debt liability rather than showing the debt issuance costs as a deferred charge on the balance sheet. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, and is effective for the Company as of the first quarter of the fiscal year ending February 28, 2017. The Company does not believe that this updated standard will have a material impact on the Company’s consolidated financial statements. | |
In June 2014, the FASB issued Accounting Standards Update 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (“ASU 2014-12”). The FASB issued ASU 2014-12 to provide explicit guidance for share-based awards which allow for an employee to vest in an award upon achievement of a performance condition met after completion of a requisite service period regardless of whether the employee is rendering service on the date the performance target is achieved. ASU 2014-12 provides that the performance target should not be reflected in estimating the grant-date fair value of the award but rather compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and recognized prospectively over the remaining requisite service period. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015, and is effective for the Company as of the first quarter of the fiscal year ending February 28, 2017. The Company has not issued such share-based awards and does not believe that this updated standard will have a material impact on the Company’s consolidated financial statements. | |
In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The FASB issued ASU 2014-09 to clarify the principles for recognizing revenue and to develop a common revenue standard for generally accepted accounting principles (“GAAP”) and International Financial Reporting Standards. The standard outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes the most current revenue recognition guidance. This guidance is currently effective for fiscal years and interim periods within those years beginning after December 15, 2016, which is effective for the Company as of the first quarter of the fiscal year ending February 28, 2018. The FASB has proposed, but has not yet ratified, a one year deferral of ASU 2014-09. The Company is evaluating the impact that the implementation of this standard will have on the Company’s consolidated financial statements. | |
In July 2013, the FASB issued Accounting Standards Update No. 2013-11, Income Taxes (Topic 740)—Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”), to eliminate diversity in practice of presenting unrecognized tax benefits as a liability or presenting unrecognized tax benefits as a reduction of a deferred tax asset for a net operating loss or tax credit carryforward in certain circumstances by requiring that an unrecognized tax benefit be presented in the financial statements as a reduction to deferred tax assets excluding certain exceptions. ASU 2013-11 became effective for the Company during the three months ended May 31, 2014. The updated standard did not have a material impact on the Company’s consolidated financial statements. | |
In March 2013, the FASB issued Accounting Standards Update No. 2013-05, Foreign Currency Matters (Topic 830)—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 (“ASU 2013-05”), which requires a parent entity to release a related foreign entity’s cumulative translation adjustment into net income only if its sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. ASU 2013-05 became effective for the Company during the three months ended May 31, 2014. The updated standard did not have a material impact on the Company’s consolidated financial statements. |
Business_Combinations
Business Combinations | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Business Combinations | NOTE 3—Business Combinations | ||||||||||||
Acquisition of FeedHenry Ltd. | |||||||||||||
On October 8, 2014 the Company completed its acquisition of all of the shares of FeedHenry Ltd. (“FeedHenry”). FeedHenry is a provider of cloud-based enterprise mobile application platforms. The acquisition is intended to expand the Company’s portfolio of application development, integration and platform-as-a-service solutions, enabling the Company to support mobile application development in public and private environments. | |||||||||||||
The consideration paid was $80.2 million and has been allocated to the Company’s assets and liabilities as follows: $68.5 million to goodwill, $9.0 million to identifiable intangible assets and the remaining $2.7 million to net working capital. | |||||||||||||
The Company incurred approximately $1.1 million in transaction costs, including legal and accounting fees, relating to the acquisition. These transaction costs have been expensed as incurred and included in general and administrative expense on the Company’s Consolidated Statement of Operations for the fiscal year ended February 28, 2015. | |||||||||||||
Acquisition of eNovance, SAS | |||||||||||||
On June 24, 2014, the Company completed its acquisition of all of the shares of eNovance, SAS (“eNovance”), a provider of open source cloud computing services. The acquisition is intended to assist in advancing the Company’s market position in OpenStack, and the addition of eNovance’s systems integration capabilities and engineering talent is expected to help meet growing demand for enterprise OpenStack consulting, design and deployment. | |||||||||||||
The consideration paid was $67.6 million and has been allocated to the Company’s assets and liabilities as follows: $60.8 million to goodwill, $5.3 million to identifiable intangible assets and the remaining $1.5 million to net working capital. | |||||||||||||
In addition to the cash consideration transferred, the Company issued a total of 529,057 restricted common shares to certain employee-shareholders. The vesting of these restricted shares is conditioned on continued employment with the Company. As a result of the employment condition, the Company has accounted for the transfer of these shares separately from the business combination. The shares effectively vest 25% per year, with the closing date fair value of the shares being amortized, on a straight-line basis, to share-based compensation expense in the Company’s Consolidated Statement of Operations. | |||||||||||||
The Company incurred approximately $0.9 million in transaction costs, including legal and accounting fees, relating to the acquisition. These transaction costs have been expensed as incurred and included in general and administrative expense on the Company’s Consolidated Statement of Operations for the fiscal year ended February 28, 2015. | |||||||||||||
Acquisition of Inktank Storage, Inc. | |||||||||||||
On April 30, 2014, the Company completed its acquisition of all of the shares of Inktank Storage, Inc. (“Inktank”), a provider of scale-out, open source storage systems, whose technology, Inktank Ceph Enterprise, delivers object and block storage software to enterprises deploying public or private clouds. The acquisition is intended to complement the Company’s existing GlusterFS-based storage and Red Hat Enterprise Linux OpenStack Platform offerings. Under the terms of the purchase agreement, the consideration transferred by the Company totaled $152.5 million. The Company incurred approximately $2.0 million in transaction costs, including legal and accounting fees, relating to the acquisition. These transaction costs have been expensed as incurred and included in general and administrative expense on the Company’s Consolidated Statement of Operations for the fiscal year ended February 28, 2015. | |||||||||||||
The total consideration transferred by the Company in connection with the acquisition is summarized in the following table (in thousands): | |||||||||||||
Total | |||||||||||||
Consideration | |||||||||||||
Transferred | |||||||||||||
Cash consideration paid to and/or on behalf of holders of Inktank stock and vested options | $ | 151,648 | |||||||||||
Fair value of nonvested employee share-based awards assumed and attributed to pre-combination services (1) | 895 | ||||||||||||
Total consideration transferred (2) | $ | 152,543 | |||||||||||
-1 | The total fair value, as of April 30, 2014, of all assumed nonvested share-based awards was $10.6 million, of which $0.9 million has been attributed to pre-acquisition employee services and accordingly has been recognized as consideration transferred. The remaining $9.7 million of fair value will be recognized as compensation expense over the remaining vesting period ranging from 1 month to approximately 4 years. | ||||||||||||
-2 | In addition to the cash consideration transferred of $151.6 million and the assumed nonvested share-based awards with an acquisition-date fair value of $10.6 million, the Company committed to pay retention incentives totaling $8.4 million in cash (payable 25% annually from the date of acquisition assuming continued employment). The Company also awarded to key employees share-based awards with a combined grant value of $15.0 million which will vest 25% annually from the date of grant. | ||||||||||||
The table below represents the tangible and identifiable intangible assets acquired and liabilities assumed (in thousands): | |||||||||||||
Total | |||||||||||||
Consideration | |||||||||||||
Allocated | |||||||||||||
Identifiable intangible assets (see detail below) | $ | 10,770 | |||||||||||
Cash | 27 | ||||||||||||
Accounts receivable | 746 | ||||||||||||
Deferred tax assets, net | 12,060 | ||||||||||||
Other assets | 161 | ||||||||||||
Accrued liabilities | (1,651 | ) | |||||||||||
Deferred revenue | (1,016 | ) | |||||||||||
Goodwill | 131,446 | ||||||||||||
Total consideration allocated | $ | 152,543 | |||||||||||
The following table summarizes the allocation of consideration transferred to identifiable intangible assets (in thousands). The fair value of the identifiable intangible assets is being amortized over the estimated useful life of each intangible asset on a straight-line basis which approximates the economic pattern of benefits: | |||||||||||||
Amortization Expense Type | Estimated Life | Total | |||||||||||
(Years) | |||||||||||||
Customer relationships | Sales and marketing | 5 | $ | 6,800 | |||||||||
Tradenames and trademarks | General and administrative | Indefinite | 3,300 | ||||||||||
Covenants not to compete | Research and development | 3 | 370 | ||||||||||
Developed technology | Cost of revenue | 5 | 300 | ||||||||||
Total identifiable intangible assets | $ | 10,770 | |||||||||||
Post-acquisition financial information | |||||||||||||
The following is a summary of the combined post-acquisition revenue, expenses and losses of FeedHenry, eNovance and Inktank that are included in the Company’s Consolidated Statement of Operations for the fiscal year ended February 28, 2015 (in thousands): | |||||||||||||
Year Ended | |||||||||||||
February 28, 2015 | |||||||||||||
Revenue | $ | 7,771 | |||||||||||
Operating expenses | (28,898 | ) | |||||||||||
Operating loss | (21,127 | ) | |||||||||||
Other income | 849 | ||||||||||||
Loss before tax benefit | (20,278 | ) | |||||||||||
Tax benefit | 5,982 | ||||||||||||
Net loss | $ | (14,296 | ) | ||||||||||
Acquisition of ManageIQ, Inc. | |||||||||||||
On December 21, 2012, the Company completed its acquisition of ManageIQ, Inc. (“ManageIQ”), a provider of enterprise cloud management and automation solutions that enable organizations to deploy, manage and optimize private clouds, public clouds and virtualized infrastuctures. Under the terms of the purchase agreement, the consideration transferred by the Company totaled $104.5 million. The total cash consideration transferred of $104.5 million has been allocated to the Company’s assets and liabilities as follows: $79.9 million to goodwill, $17.3 million to identifiable intangible assets and the remaining $7.3 million to net working capital. | |||||||||||||
The Company incurred approximately $0.5 million in transaction costs including legal and accounting fees relating to the acquisition. These costs have been expensed as incurred and included in general and administrative expense on the Consolidated Statement of Operations for the year ended February 28, 2013. | |||||||||||||
Other acquisitions in fiscal 2013 | |||||||||||||
During the year ended February 28, 2013, the Company entered into agreements to acquire two businesses operating in the middleware space. These acquisitions include technologies that are complementary to the Company’s JBoss Middleware technology. One acquisition, which included certain assets and related operations acquired from Polymita Technologies S.L. (“Polymita”), closed on August 28, 2012. The second acquisition closed on September 7, 2012 and included certain assets and related operations acquired from FuseSource, a division of Progress Software Corporation (“FuseSource”). The total cash consideration for these two acquisitions was $31.2 million. The total cash consideration transferred of $31.2 million has been allocated to the Company’s assets as follows: $17.5 million to goodwill, $13.2 million to identifiable intangible assets and the remaining $0.5 million to other current assets. | |||||||||||||
Transaction fees related to these two acquisitions totaled approximately $1.0 million for the year ended February 28, 2013 and are included in general and administrative expense on the Company’s Consolidated Statement of Operations for the year ended February 28, 2013. | |||||||||||||
Pro forma consolidated financial information | |||||||||||||
The following unaudited pro forma consolidated financial information reflects the results of operations of the Company for the fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands, except per share amounts) as if all of the acquisitions completed during fiscal 2015 and fiscal 2013 had closed on March 1, 2012, after giving effect to certain purchase accounting adjustments. These pro forma results are not necessarily indicative of what the Company’s operating results would have been had the acquisitions actually taken place at the beginning of the period. | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Revenue | $ | 1,794,948 | $ | 1,551,301 | $ | 1,339,595 | |||||||
Net income | 174,991 | 150,870 | 116,944 | ||||||||||
Basic net income per common share | $ | 0.94 | $ | 0.79 | $ | 0.61 | |||||||
Diluted net income per common share | $ | 0.92 | $ | 0.79 | $ | 0.6 | |||||||
Goodwill and other business combinations | |||||||||||||
The Company completed its annual goodwill impairment test in February 2015. No goodwill impairment was deemed to have occurred in fiscal 2015, 2014 or 2013. The following is a summary of goodwill for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | |||||||||||||
Balance at February 29, 2012 | $ | 591,563 | |||||||||||
Acquisition of ManageIQ | 83,074 | ||||||||||||
Other acquisitions | 17,462 | ||||||||||||
Impact of foreign currency fluctuations and other adjustments | (1,188 | ) | |||||||||||
Balance at February 28, 2013 | $ | 690,911 | |||||||||||
Final purchase price allocation adjustment for ManageIQ | (3,164 | ) | |||||||||||
Impact of foreign currency fluctuations | (317 | ) | |||||||||||
Balance at February 28, 2014 | $ | 687,430 | |||||||||||
Acquisition of Inktank | 131,446 | ||||||||||||
Acquisition of eNovance | 60,849 | ||||||||||||
Acquisition of FeedHenry | 68,491 | ||||||||||||
Impact of foreign currency fluctuations | (21,156 | ) | |||||||||||
Balance at February 28, 2015 | $ | 927,060 | |||||||||||
The excess of purchase price paid for FeedHenry, eNovance, Inktank, ManageIQ and other acquisitions over the fair value of the net assets acquired was recognized as goodwill. Goodwill comprises the majority of the purchase price paid for each of the acquired businesses because these businesses were focused on emerging technologies such as mobile technologies, cloud-enabling technologies and software-defined storage technologies, which consequently—at the time of acquisition—generated relatively little revenue. However, these acquired businesses, with their assembled, highly-specialized workforces and community of contributors, are expected to both expand the Company’s existing technology portfolio and advance the Company’s market position overall in open source enterprise solutions. |
Accounts_Receivable
Accounts Receivable | 12 Months Ended | ||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||
Accounts Receivable | NOTE 4—Accounts Receivable | ||||||||||||||||
Accounts receivable are presented net of an allowance for doubtful accounts. Activity in the Company’s allowance for doubtful accounts for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 is presented in the following table (in thousands): | |||||||||||||||||
Balance at | Charged | Adjustments (1) | Balance at | ||||||||||||||
beginning | to (recovery of) | end of | |||||||||||||||
of period | expense | period | |||||||||||||||
2013 | $ | 1,877 | $ | (102 | ) | $ | (436 | ) | $ | 1,339 | |||||||
2014 | $ | 1,339 | $ | 841 | $ | (194 | ) | $ | 1,986 | ||||||||
2015 | $ | 1,986 | $ | 469 | $ | (208 | ) | $ | 2,247 | ||||||||
-1 | Represents foreign currency translation adjustments and amounts written-off as uncollectible accounts receivable. | ||||||||||||||||
As of February 28, 2015 and February 28, 2014, no individual customer accounted for 10% or more of the Company’s accounts receivable. |
Property_and_Equipment
Property and Equipment | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Property and Equipment | NOTE 5—Property and Equipment | ||||||||||||
The Company’s property and equipment is recorded at cost and consists of the following (in thousands): | |||||||||||||
February 28, | February 28, | ||||||||||||
2015 | 2014 | ||||||||||||
Computer equipment | $ | 141,972 | $ | 137,570 | |||||||||
Software, including software developed for internal use | 80,565 | 112,348 | |||||||||||
Furniture and fixtures | 28,595 | 28,007 | |||||||||||
Leasehold improvements | 100,882 | 96,410 | |||||||||||
Property and equipment—in progress | 10,251 | 8,877 | |||||||||||
Property and equipment | $ | 362,265 | $ | 383,212 | |||||||||
Less: accumulated depreciation | (190,114 | ) | (209,295 | ) | |||||||||
Property and equipment, net | $ | 172,151 | $ | 173,917 | |||||||||
The useful lives of property and equipment range from three to fifteen years. Leasehold improvements are amortized over the lesser of the useful life or lease term. Depreciation expense recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 is summarized as follows (in thousands): | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Total depreciation expense | $ | 48,001 | $ | 45,169 | $ | 38,818 | |||||||
Identifiable_Intangible_Assets
Identifiable Intangible Assets | 12 Months Ended | ||||||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||||||
Identifiable Intangible Assets | NOTE 6—Identifiable Intangible Assets | ||||||||||||||||||||||||
Identifiable intangible assets consist primarily of trademarks, copyrights and patents, purchased technologies, customer and reseller relationships, and covenants not to compete which are amortized over the estimated useful life, generally on a straight-line basis, with the exception of customer and reseller relationships which are generally amortized over the greater of straight-line or the related asset’s pattern of economic benefit. Useful lives range from three to ten years. As of February 28, 2015 and February 28, 2014, trademarks with an indefinite estimated useful life totaled $11.3 million and $9.6 million, respectively. The following is a summary of identifiable intangible assets (in thousands): | |||||||||||||||||||||||||
February 28, 2015 | February 28, 2014 | ||||||||||||||||||||||||
Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||||||
Amount | Amortization | Amount | Amount | Amortization | Amount | ||||||||||||||||||||
Trademarks, copyrights and patents | $ | 117,020 | $ | (42,630 | ) | $ | 74,390 | $ | 105,269 | $ | (34,784 | ) | $ | 70,485 | |||||||||||
Purchased technologies | 81,482 | (63,618 | ) | 17,864 | 79,433 | (55,960 | ) | 23,473 | |||||||||||||||||
Customer and reseller relationships | 104,084 | (71,512 | ) | 32,572 | 89,992 | (63,075 | ) | 26,917 | |||||||||||||||||
Covenants not to compete | 10,683 | (7,657 | ) | 3,026 | 10,690 | (5,977 | ) | 4,713 | |||||||||||||||||
Other intangible assets | 8,833 | (2,409 | ) | 6,424 | 8,922 | (1,111 | ) | 7,811 | |||||||||||||||||
Total identifiable intangible assets | $ | 322,102 | $ | (187,826 | ) | $ | 134,276 | $ | 294,306 | $ | (160,907 | ) | $ | 133,399 | |||||||||||
Amortization expense associated with identifiable intangible assets recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 is summarized as follows (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Cost of revenue | $ | 12,049 | $ | 11,212 | $ | 5,943 | |||||||||||||||||||
Sales and marketing | 7,838 | 8,872 | 8,416 | ||||||||||||||||||||||
Research and development | 2,417 | 3,836 | 3,836 | ||||||||||||||||||||||
General and administrative | 5,958 | 5,316 | 5,328 | ||||||||||||||||||||||
Total amortization expense | $ | 28,262 | $ | 29,236 | $ | 23,523 | |||||||||||||||||||
As of February 28, 2015, future amortization expense on existing intangibles is as follows (in thousands): | |||||||||||||||||||||||||
Fiscal Year | Amortization | ||||||||||||||||||||||||
Expense of | |||||||||||||||||||||||||
Intangible Assets | |||||||||||||||||||||||||
2016 | $ | 27,885 | |||||||||||||||||||||||
2017 | 25,209 | ||||||||||||||||||||||||
2018 | 21,477 | ||||||||||||||||||||||||
2019 | 15,161 | ||||||||||||||||||||||||
2020 | 11,072 | ||||||||||||||||||||||||
Thereafter | 22,184 | ||||||||||||||||||||||||
Total amortization expense | $ | 122,988 | |||||||||||||||||||||||
Other_Assets_Net
Other Assets, Net | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Other Assets, Net | NOTE 7—Other Assets, Net | ||||||||
Other assets, net were comprised of the following (in thousands): | |||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Cost-basis investments | $ | 28,154 | $ | 21,801 | |||||
Net non-current deferred tax asset (see NOTE 11—Income Taxes) | 18,049 | 7,655 | |||||||
Security deposits and other | 7,040 | 5,935 | |||||||
Other assets, net | $ | 53,243 | $ | 35,391 | |||||
The Company reviews its non-marketable cost-basis investments in equity securities for other than temporary declines in fair value based on prices recently paid for shares in that company, as well as changes in market conditions. The carrying values are not necessarily representative of the amounts that the Company could realize in a current transaction. The Company recognized a loss of $4.6 million on certain investments during the year ended February 28, 2015. During the years ended February 28, 2014 and February 28, 2013, no significant losses were recognized on similar investments. |
Prepaid_Expenses
Prepaid Expenses | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Prepaid Expenses | NOTE 8—Prepaid Expenses | ||||||||
Prepaid expenses include sales commissions, taxes and insurance. Sales commissions are the incremental costs that are directly associated with non-cancelable subscription contracts with customers and consist of sales commissions paid to the Company’s sales force. The commissions are deferred and amortized over a period to approximate the period of the subscription term. For further discussion on deferred commissions see NOTE 2—Summary of Significant Accounting Policies. Prepaid expenses, including sales commissions, were comprised of the following (in thousands): | |||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Deferred commissions | $ | 107,313 | $ | 80,987 | |||||
Professional services | 14,934 | 12,827 | |||||||
Taxes | 17,543 | 13,012 | |||||||
Insurance | 1,859 | 1,207 | |||||||
Other | 9,066 | 10,354 | |||||||
Prepaid expenses | $ | 150,715 | $ | 118,387 | |||||
Accounts_Payable_and_Accrued_E
Accounts Payable and Accrued Expenses | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Accounts Payable and Accrued Expenses | NOTE 9— Accounts Payable and Accrued Expenses | ||||||||
Accounts payable and accrued expenses were comprised of the following (in thousands): | |||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Accounts payable | $ | 31,017 | $ | 18,326 | |||||
Accrued wages and other compensation related expenses | 126,378 | 100,474 | |||||||
Accrued other trade payables | 40,400 | 40,998 | |||||||
Accrued income and other taxes payable | 39,596 | 19,253 | |||||||
Accrued other | 342 | 417 | |||||||
Accounts payable and accrued expenses | $ | 237,733 | $ | 179,468 | |||||
Derivative_Instruments
Derivative Instruments | 12 Months Ended | ||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||
Derivative Instruments | NOTE 10—Derivative Instruments | ||||||||||||||||
The Company transacts business in various foreign countries and is, therefore, subject to risk of foreign currency exchange rate fluctuations. The Company from time to time enters into forward contracts to economically hedge transactional exposure associated with commitments arising from trade accounts receivable, trade accounts payable and fixed purchase obligations denominated in a currency other than the functional currency of the respective operating entity. All derivative instruments are recorded on the Consolidated Balance Sheets at their respective fair market values. The Company has elected not to prepare and maintain the documentation required to qualify for hedge accounting treatment and, therefore, changes in fair value are recorded in the Consolidated Statements of Operations. | |||||||||||||||||
The effects of derivative instruments on the Company’s Consolidated Financial Statements are as follows as of February 28, 2015 and for the year then ended (in thousands): | |||||||||||||||||
Year ended February 28, 2015 | |||||||||||||||||
As of February 28, 2015 | Classification of Gain | Amount of Gain | |||||||||||||||
(Loss) Recognized | (Loss) Recognized | ||||||||||||||||
in Income on | in Income on | ||||||||||||||||
Balance | Fair | Notional | Derivatives | Derivatives | |||||||||||||
Sheet Classification | Value | Value | |||||||||||||||
Assets—foreign currency forward contracts not designated as hedges | Other current assets | $ | 74 | $ | 5,281 | Other income (expense), net | $ | 664 | |||||||||
Liabilities—foreign currency forward contracts not designated as hedges | Accounts payable and accrued expenses | (738 | ) | 102,836 | Other income (expense), net | (2,626 | ) | ||||||||||
TOTAL | $ | (664 | ) | $ | 108,117 | $ | (1,962 | ) | |||||||||
The effects of derivative instruments on the Company’s Consolidated Financial Statements are as follows as of February 28, 2014 and for the year then ended (in thousands): | |||||||||||||||||
Year ended February 28, 2014 | |||||||||||||||||
As of February 28, 2014 | Classification of Gain | Amount of Gain | |||||||||||||||
(Loss) Recognized | (Loss) Recognized | ||||||||||||||||
in Income on | in Income on | ||||||||||||||||
Balance | Fair | Notional | Derivatives | Derivatives | |||||||||||||
Sheet Classification | Value | Value | |||||||||||||||
Assets—foreign currency forward contracts not designated as hedges | Other current assets | $ | 134 | $ | 24,790 | Other income (expense), net | $ | 1,147 | |||||||||
Liabilities—foreign currency forward contracts not designated as hedges | Accounts payable and accrued expenses | (15 | ) | 3,546 | Other income (expense), net | (2,697 | ) | ||||||||||
TOTAL | $ | 119 | $ | 28,336 | $ | (1,550 | ) | ||||||||||
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Income Taxes | NOTE 11—Income Taxes | ||||||||||||
The U.S. and foreign components of the Company’s income before provision for income taxes consisted of the following (in thousands): | |||||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
U.S. | $ | 167,388 | $ | 135,371 | $ | 130,560 | |||||||
Foreign | 88,110 | 104,177 | 79,192 | ||||||||||
Income before provision for income taxes | $ | 255,498 | $ | 239,548 | $ | 209,752 | |||||||
The components of the Company’s provision for income taxes consisted of the following (in thousands): | |||||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Current: | |||||||||||||
Foreign | $ | 26,325 | $ | 23,391 | $ | 16,556 | |||||||
Federal | 15,252 | 19,734 | 33,598 | ||||||||||
State | 4,090 | 7,147 | 1,882 | ||||||||||
Current tax expense | $ | 45,667 | $ | 50,272 | $ | 52,036 | |||||||
Deferred: | |||||||||||||
Foreign | (8,188 | ) | (1,100 | ) | 2,899 | ||||||||
Federal | 36,197 | 14,468 | 9,687 | ||||||||||
State | 1,621 | (2,384 | ) | (5,074 | ) | ||||||||
Deferred tax expense | $ | 29,630 | $ | 10,984 | $ | 7,512 | |||||||
Net provision for income taxes | $ | 75,297 | $ | 61,256 | $ | 59,548 | |||||||
Significant components of the Company’s deferred tax assets and liabilities at February 28, 2015 and February 28, 2014, consisted of the following (in thousands): | |||||||||||||
February 28, | February 28, | ||||||||||||
2015 | 2014 | ||||||||||||
Deferred tax assets: | |||||||||||||
Foreign net operating loss carryforwards | $ | 6,704 | $ | 4,016 | |||||||||
Domestic net operating loss carryforwards | 17,956 | 8,650 | |||||||||||
Domestic credit carryforwards | 8,990 | 24,045 | |||||||||||
Share-based compensation | 36,996 | 32,478 | |||||||||||
Deferred revenue | 68,850 | 49,749 | |||||||||||
Foreign deferred royalty expenses | 9,958 | 8,396 | |||||||||||
Convertible notes | 18,683 | — | |||||||||||
Other | 12,407 | 10,599 | |||||||||||
Total deferred tax assets | $ | 180,544 | $ | 137,933 | |||||||||
Valuation allowance for deferred tax assets | (2,641 | ) | (699 | ) | |||||||||
Total deferred tax assets, net of valuation allowance | $ | 177,903 | $ | 137,234 | |||||||||
Deferred tax liabilities: | |||||||||||||
Goodwill | 7,835 | 5,163 | |||||||||||
Fixed and intangible assets | 37,321 | 28,283 | |||||||||||
Compensation accruals | 23,518 | 12,738 | |||||||||||
Other | 11,152 | 3,342 | |||||||||||
Total deferred tax liabilities | $ | 79,826 | $ | 49,526 | |||||||||
Net deferred tax asset | $ | 98,077 | $ | 87,708 | |||||||||
The Company’s gross and net deferred tax asset and liability positions at February 28, 2015 are as follows (in thousands): | |||||||||||||
Domestic | Foreign | Consolidated | |||||||||||
Deferred tax assets: | |||||||||||||
Current | $ | 94,120 | $ | 24,330 | $ | 118,450 | |||||||
Non-current | 51,666 | 7,787 | 59,453 | ||||||||||
Deferred tax liabilities: | |||||||||||||
Current | 24,270 | 8,043 | 32,313 | ||||||||||
Non-current | 44,389 | 3,124 | 47,513 | ||||||||||
Net deferred tax asset | $ | 77,127 | $ | 20,950 | $ | 98,077 | |||||||
Net current deferred tax asset | $ | 69,850 | $ | 16,946 | $ | 86,796 | |||||||
Net non-current deferred tax asset, recorded in Other assets, net | 7,277 | 10,772 | 18,049 | ||||||||||
Net current deferred tax liability, recorded in Other current obligations | — | (659 | ) | (659 | ) | ||||||||
Net non-current deferred tax liability, recorded in Other long-term obligations | — | (6,109 | ) | (6,109 | ) | ||||||||
Net deferred tax asset | $ | 77,127 | $ | 20,950 | $ | 98,077 | |||||||
As of February 28, 2015, the Company continues to maintain a valuation allowance against its deferred tax assets with respect to certain foreign and state net operating loss (“NOL”) and credit carryforwards. For the year ended February 28, 2015, the valuation allowance increased by $1.9 million primarily as a result of acquired foreign NOL carryfowards. | |||||||||||||
As of February 28, 2015, the Company had U.S. federal NOL carryforwards of $43.5 million, foreign NOL carryforwards of $30.2 million and U.S. state NOL carryforwards of $75.2 million, of which $27.3 million consists of share-based compensation deductions in excess of the amounts expensed in the Company’s operating results. The resulting excess tax benefit will be recognized as an increase to additional paid in capital when realized. The NOL carryforwards expire in varying amounts beginning in the fiscal year ending February 29, 2016. As of February 28, 2015, the Company had U.S. federal research tax credit carryforwards of $7.4 million and state research tax credit carryforwards of $12.0 million, which expire in varying amounts beginning in the fiscal year ending February 29, 2016. | |||||||||||||
Taxes computed at the statutory federal income tax rates are reconciled to the provision for income taxes for the years ended February 28, 2015, February 28, 2014 and February 28, 2013, respectively, as follows (in thousands): | |||||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Effective rate | 29.5 | % | 25.6 | % | 28.4 | % | |||||||
Provision at federal statutory rate, 35% | $ | 89,424 | $ | 83,842 | $ | 73,413 | |||||||
State tax, net of federal tax benefit (1) | 4,042 | 3,169 | 907 | ||||||||||
Foreign rate differential | (11,124 | ) | (10,817 | ) | (7,034 | ) | |||||||
Israel tax holiday (2) | (2,859 | ) | (1,901 | ) | (1,806 | ) | |||||||
Foreign dividend | 8,720 | 623 | 5,787 | ||||||||||
Nondeductible items | 3,339 | 2,157 | 2,141 | ||||||||||
Research tax credit | (5,329 | ) | (3,070 | ) | (5,348 | ) | |||||||
Foreign tax credit | (11,755 | ) | (11,878 | ) | (7,852 | ) | |||||||
Domestic production activities deduction | (4,433 | ) | (4,973 | ) | — | ||||||||
Other | 5,272 | 4,104 | (660 | ) | |||||||||
Provision for income taxes | $ | 75,297 | $ | 61,256 | $ | 59,548 | |||||||
-1 | During the year ended February 28, 2013, the Company amended its state income tax returns for prior years, which resulted in a reduction of state tax, net of federal tax benefit, of $3.4 million. | ||||||||||||
-2 | The Company qualifies for a tax holiday in Israel which began during the fiscal year ended February 28, 2011 and is scheduled to terminate as of the fiscal year ending February 29, 2020. The tax holiday provides for an exemption from income tax in the first two years, and for a reduced rate of taxation on income generated in Israel for the subsequent eight years. The financial impact of this holiday for the year ended February 28, 2015 was a $2.9 million reduction in the Company’s provision for income taxes, which increased the Company’s diluted earnings per share by approximately $0.02. | ||||||||||||
As of February 28, 2015, cumulative undistributed earnings of non-U.S. subsidiaries totaled $420.0 million. Determination of the deferred tax liability, if any, on these earnings reinvested indefinitely outside the U.S. is not practicable because of available foreign tax credits, continually changing variables and other factors. It is the Company’s policy to invest the earnings of foreign subsidiaries indefinitely outside the U.S. From time to time, however, the Company may remit a portion of these earnings to the extent it does not incur additional U.S. tax and it is otherwise feasible. The Company has provided U.S. income taxes on the earnings of certain foreign subsidiaries that are not considered as permanently reinvested outside the U.S. The U.S. income tax on such earnings is completely offset by U.S. foreign tax credits. The Company has also provided U.S. income taxes on the earnings of certain foreign subsidiaries that are permanently reinvested outside the U.S. but are deemed distributed for U.S. federal income tax purposes. The U.S. income tax on such earnings is reduced or offset by available U.S. foreign tax credits. | |||||||||||||
Unrecognized tax benefits | |||||||||||||
The following table reconciles unrecognized tax benefits for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | |||||||||||||
Balance at February 29, 2012 | $ | 43,762 | |||||||||||
Additions based on tax positions related to prior years | 2,122 | ||||||||||||
Additions based on tax positions related to the current year | 2,576 | ||||||||||||
Reductions related to changes in facts and circumstances | (147 | ) | |||||||||||
Balance at February 29, 2013 | $ | 48,313 | |||||||||||
Additions based on tax positions related to prior years | 100 | ||||||||||||
Additions based on tax positions related to the current year | 9,005 | ||||||||||||
Reductions related to settlements with tax authorities | (364 | ) | |||||||||||
Balance at February 28, 2014 | $ | 57,054 | |||||||||||
Additions based on tax positions related to prior years | 514 | ||||||||||||
Additions based on tax positions related to the current year | 3,374 | ||||||||||||
Reductions related to changes in facts and circumstances | (229 | ) | |||||||||||
Reductions related to lapse of the statute of limitations | (370 | ) | |||||||||||
Balance at February 28, 2015 | $ | 60,343 | |||||||||||
The Company’s unrecognized tax benefits as February 28, 2015 and February 28, 2014, which, if recognized, would affect the Company’s effective tax rate were $55.7 million and $49.7 million, respectively. | |||||||||||||
It is the Company’s policy to recognize interest and penalties related to uncertain tax positions as income tax expense. Accrued interest and penalties related to unrecognized tax benefits totaled $9.2 million and $6.0 million as of February 28, 2015 and February 28, 2014, respectively. | |||||||||||||
The results and timing of the resolution of tax audits is highly uncertain and the Company is unable to estimate the range of the possible changes to the balance of unrecognized tax benefits. However, the Company does not anticipate that within the next 12 months that the total amount of unrecognized tax benefits will significantly increase or decrease as a result of any such potential tax audit resolutions. | |||||||||||||
The Company or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. The following table summarizes the tax years in the Company’s major tax jurisdictions that remain subject to income tax examinations by tax authorities as of February 28, 2015. Due to NOL carryforwards, in some cases the tax years continue to remain subject to examination with respect to such NOLs: | |||||||||||||
Tax Jurisdiction | Years Subject to | ||||||||||||
Income Tax | |||||||||||||
Examination | |||||||||||||
U.S. federal (1) | 1994 – Present | ||||||||||||
California | 2001 – Present | ||||||||||||
North Carolina | 1999 – Present | ||||||||||||
Massachusetts | 2008 – Present | ||||||||||||
Ireland | 2010 – Present | ||||||||||||
Japan (2) | 2012 – Present | ||||||||||||
-1 | The U.S. Internal Revenue Service has completed its examination with respect to the Company’s fiscal year ended February 28, 2010 and proposed certain adjustments. The Company believes that it has adequately provided for any reasonably foreseeable outcomes that may result from the proposed adjustments but, depending on the ultimate outcome, the Company could be required to pay additional income taxes. The Company does not believe that such outcome would have a material effect on its consolidated financial condition or consolidated results of operations. | ||||||||||||
-2 | The Company has been examined for income tax for years through February 28, 2011. A tax examination was concluded in fiscal 2012 with no significant adjustments resulting. However, the statute of limitations remains open for five years. | ||||||||||||
The Company is currently undergoing an income tax examination in India. | |||||||||||||
The Company believes it has adequately provided for any reasonably foreseeable outcomes related to tax audits. |
Common_and_Preferred_Stock
Common and Preferred Stock | 12 Months Ended |
Feb. 28, 2015 | |
Common and Preferred Stock | NOTE 12—Common and Preferred Stock |
Common stock | |
The Company has authorized 300,000,000 shares of common stock with a par value of $0.0001 per share. Holders of these shares have one vote per share. Upon the dissolution, liquidation or winding up of the Company, holders of common stock will be entitled to receive the assets of the Company after satisfaction of the preferential rights of any outstanding preferred stock or any other outstanding stock ranking on liquidation senior to or on parity with the common stock. | |
The Company repurchased 8,355,757 shares, 5,006,579 shares and 2,290,936 shares of its common stock during the fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013, respectively, at an aggregate cost of $535.1 million, $239.4 million and $120.7 million, respectively. These amounts are recorded as treasury stock on the Company’s Consolidated Balance Sheets. | |
Preferred stock | |
At February 28, 2015, the Company has authorized 5,000,000 shares of preferred stock with a par value of $0.0001 per share. No shares of preferred stock were outstanding as of February 28, 2015 or February 28, 2014. |
Sharebased_Awards
Share-based Awards | 12 Months Ended | ||||||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||||||
Share-based Awards | NOTE 13—Share-based Awards | ||||||||||||||||||||||||
Overview | |||||||||||||||||||||||||
The Company’s 2004 Long-Term Incentive Plan, as amended and restated (the “2004 Plan”), provides for the granting of stock options, service-based share awards and performance-based share awards, among other awards. As of February 28, 2015, there were 14.9 million shares of common stock reserved for issuance under future share-based awards to be granted to any employee, officer or director or consultant of the Company at terms and prices to be determined by the Board of Directors. | |||||||||||||||||||||||||
The following table summarizes share-based awards, by type, granted during the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | |||||||||||||||||||||||||
Awards Granted | Awards Granted | Awards Granted | |||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, 2015 | February 28, 2014 | February 28, 2013 | |||||||||||||||||||||||
Shares and | Weighted | Shares and | Weighted | Shares and | Weighted | ||||||||||||||||||||
Shares | Average | Shares | Average | Shares | Average | ||||||||||||||||||||
Underlying | Per Share | Underlying | Per Share | Underlying | Per Share | ||||||||||||||||||||
Awards | Award | Awards | Award | Awards | Award | ||||||||||||||||||||
Fair Value | Fair Value | Fair Value | |||||||||||||||||||||||
Stock options | — | $ | — | 133,800 | $ | 12.64 | 114,361 | $ | 15.16 | ||||||||||||||||
Service-based shares and share units (1) | 2,994,553 | $ | 53.23 | 2,513,328 | $ | 47.43 | 2,471,872 | $ | 54.62 | ||||||||||||||||
Performance-based share units—Maximum | 1,148,084 | $ | 52.17 | 671,448 | $ | 47.86 | 613,800 | $ | 52.23 | ||||||||||||||||
Stock options assumed as part of a business combination | 219,169 | $ | 48.45 | — | $ | — | — | $ | — | ||||||||||||||||
Restricted shares issued as part of a business combination with continued-employment service conditions | 529,057 | $ | 54.75 | — | $ | — | — | $ | — | ||||||||||||||||
Total share-based awards | 4,890,863 | $ | 52.93 | 3,318,576 | $ | 46.11 | 3,200,033 | $ | 52.75 | ||||||||||||||||
-1 | Service-based shares granted during the year ended February 28, 2015 include 184,325 restricted shares awarded to certain executives that were subject to both a four-year service condition and the achievement of a specified dollar amount of revenue for fiscal year 2015 (the “RSA performance goal”). The RSA performance goal for fiscal year 2015 was met. Therefore, as of February 28, 2015 only the service condition remained, with 25% of such shares scheduled to vest vesting on July 16, 2015, one year from the date of grant, and the remainder vesting ratably on a quarterly basis over the course of the subsequent three-year period. | ||||||||||||||||||||||||
The following summarizes share-based compensation expense recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Cost of revenue | $ | 14,027 | $ | 11,793 | $ | 9,433 | |||||||||||||||||||
Sales and marketing | 55,203 | 40,322 | 32,906 | ||||||||||||||||||||||
Research and development | 38,517 | 34,194 | 29,647 | ||||||||||||||||||||||
General and administrative | 27,485 | 27,465 | 26,712 | ||||||||||||||||||||||
Total share-based compensation expense | $ | 135,232 | $ | 113,774 | $ | 98,698 | |||||||||||||||||||
Share-based compensation expense qualifying for capitalization was insignificant for each of the Company’s fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013. Accordingly, no share-based compensation expense was capitalized during these years. | |||||||||||||||||||||||||
Estimated annual forfeitures—An estimated forfeiture rate of 10% per annum, which approximates the Company’s historical rate, was applied to options and service-based share awards. Awards are adjusted to actual forfeiture rates at vesting. The Company reassesses its estimated forfeiture rate annually or when new information, including actual forfeitures, indicate a change is appropriate. | |||||||||||||||||||||||||
Stock options | |||||||||||||||||||||||||
The 2004 Plan provides that the purchase price per share for each option shall not be less than the fair market value of the underlying share on the date of grant. Options granted under the 2004 Plan to date include contract terms of five years and generally vest 25% upon completion of one full year of service and 6.25% on the first day of each subsequent three-month period of service. The maximum contract term for an option granted under the 2004 Plan is seven years from the date of grant. | |||||||||||||||||||||||||
The total fair value of stock options recognized in the Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total fair value of stock options recognized | $ | 5,085 | $ | 2,139 | $ | 2,791 | |||||||||||||||||||
The following table summarizes the activity for the Company’s stock options for the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | |||||||||||||||||||||||||
Shares Underlying | Weighted Average | ||||||||||||||||||||||||
Options | Exercise Price Per | ||||||||||||||||||||||||
Share | |||||||||||||||||||||||||
Outstanding at February 29, 2012 | 1,103,153 | $ | 16.21 | ||||||||||||||||||||||
Granted | 114,361 | 55.17 | |||||||||||||||||||||||
Exercised | (735,086 | ) | 15.61 | ||||||||||||||||||||||
Forfeited | (29,741 | ) | 25.1 | ||||||||||||||||||||||
Outstanding at February 28, 2013 | 452,687 | $ | 26.43 | ||||||||||||||||||||||
Granted | 133,800 | 47.12 | |||||||||||||||||||||||
Exercised | (175,026 | ) | 12.13 | ||||||||||||||||||||||
Forfeited | (34,840 | ) | 22.93 | ||||||||||||||||||||||
Outstanding at February 28, 2014 | 376,621 | $ | 40.75 | ||||||||||||||||||||||
Granted | — | — | |||||||||||||||||||||||
Exercised | (141,702 | ) | 17.18 | ||||||||||||||||||||||
Forfeited | (22,310 | ) | 28.69 | ||||||||||||||||||||||
Assumed (1) | 219,169 | 0.2 | |||||||||||||||||||||||
Outstanding at February 28, 2015 | 431,778 | $ | 28.53 | ||||||||||||||||||||||
-1 | Amount represents partially vested options assumed as part of a business combination. | ||||||||||||||||||||||||
As described above, options are typically granted with an exercise price equal to the fair market value of the Company’s common stock on the date of grant. No options were granted by the Company during the three years ended February 28, 2015 with exercise prices less than the grant date fair value of the Company’s common stock. | |||||||||||||||||||||||||
The following summarizes information, as of February 28, 2015, about the Company’s outstanding and exercisable stock options: | |||||||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||||||
Exercise Prices | Number | Weighted | Weighted | Number | Weighted | ||||||||||||||||||||
Outstanding | Average | Average | Exercisable | Average | |||||||||||||||||||||
Remaining | Exercise Price | Exercise Price | |||||||||||||||||||||||
Contractual Life | |||||||||||||||||||||||||
$ 0.00 – $10.00 | 182,624 | 7.7 | $ | 0.33 | 56,976 | $ | 0.57 | ||||||||||||||||||
$10.01 – $20.00 | 3,130 | 0.9 | $ | 15.65 | 3,130 | $ | 15.65 | ||||||||||||||||||
$20.01 – $30.00 | — | — | $ | — | — | $ | — | ||||||||||||||||||
$30.01 – $40.00 | 11,667 | 0.6 | $ | 39.82 | 11,667 | $ | 39.82 | ||||||||||||||||||
$40.01 – $50.00 | 99,106 | 2.9 | $ | 44.23 | 40,288 | $ | 44.49 | ||||||||||||||||||
$50.01 and over | 135,251 | 2.7 | $ | 54.43 | 66,086 | $ | 54.92 | ||||||||||||||||||
Total | 431,778 | 4.8 | $ | 28.53 | 178,147 | $ | 33.5 | ||||||||||||||||||
The following summarizes the intrinsic value, as of February 28, 2015, of the Company’s outstanding, exercisable and expected to vest stock options: | |||||||||||||||||||||||||
Intrinsic Value of Stock Options | Number of | Weighted Average | Intrinsic Value at | ||||||||||||||||||||||
Stock Options | Remaining | February 28, 2015 | |||||||||||||||||||||||
Contractual Life | (in thousands) | ||||||||||||||||||||||||
Outstanding | 431,778 | 4.8 | $ | 17,526 | |||||||||||||||||||||
Exercisable | 178,147 | 3.7 | $ | 6,346 | |||||||||||||||||||||
Expected to vest (assuming annual forfeiture rate of 10%) | 227,474 | 5.6 | $ | 10,054 | |||||||||||||||||||||
The intrinsic value of stock options exercised during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total intrinsic value of stock options exercised | $ | 6,289 | $ | 6,775 | $ | 29,598 | |||||||||||||||||||
As of February 28, 2015, compensation cost related to unvested stock options not yet recognized in the Company’s Consolidated Financial Statements totaled $7.6 million. The weighted average period over which these unvested stock options are expected to be recognized is approximately 2.0 years. | |||||||||||||||||||||||||
The fair values of options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 were estimated on the date of grant or assumption using the Black-Scholes-Merton option-pricing model based on the following weighted average assumptions: | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Expected dividend yield | — | % | — | % | — | % | |||||||||||||||||||
Risk-free interest rate | 0.98 | % | 0.62 | % | 0.41 | % | |||||||||||||||||||
Expected volatility (1) | 36.39 | % | 36.8 | % | 38.13 | % | |||||||||||||||||||
Expected life (in years) (2) | 3.27 | 3.27 | 3.27 | ||||||||||||||||||||||
Weighted average fair value of options granted or assumed during the period | $ | 48.45 | $ | 12.64 | $ | 15.16 | |||||||||||||||||||
-1 | The expected volatility rates for options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 were estimated based on an approximate equal weighting of the historical volatility of the Company’s common stock over a period of approximately 3.27 years and the implied volatility of publicly traded options for the Company’s common stock. | ||||||||||||||||||||||||
-2 | The expected term for options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was determined based on the Company’s historical exercise data. The Company reassesses its estimate of expected term annually or when new information indicates a change is appropriate. | ||||||||||||||||||||||||
Service-based share awards | |||||||||||||||||||||||||
Service-based share awards include nonvested shares, nonvested share units and deferred share units granted under the 2004 Plan. Nonvested shares and share units generally vest, subject to continued service to the Company, (i) 25% on the first anniversary of the date of grant and 6.25% on the first day of each subsequent three-month period for nonvested shares and (ii) 25% each year over a four-year period beginning on the date of grant for nonvested share units. Nonvested shares and nonvested share units are generally amortized to expense on a straight-line basis over four years. Deferred share units are awarded to directors and generally vest within one year when issued in lieu of annual share awards or immediately when issued in lieu of cash. | |||||||||||||||||||||||||
The total fair value of service-based share awards recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total fair value of service-based awards recognized | $ | 107,887 | $ | 92,450 | $ | 76,460 | |||||||||||||||||||
The following table summarizes the activity for the Company’s service-based share awards for the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | |||||||||||||||||||||||||
Nonvested | Weighted Average | ||||||||||||||||||||||||
Shares and | Grant-date | ||||||||||||||||||||||||
Share Units | Fair Value | ||||||||||||||||||||||||
Service-based share awards at February 29, 2012 | 5,486,639 | $ | 36.36 | ||||||||||||||||||||||
Granted | 2,471,872 | 54.62 | |||||||||||||||||||||||
Vested | (2,184,588 | ) | 31.33 | ||||||||||||||||||||||
Forfeited | (580,490 | ) | 41.56 | ||||||||||||||||||||||
Service-based share awards at February 28, 2013 | 5,193,433 | $ | 46.59 | ||||||||||||||||||||||
Granted | 2,513,328 | 47.43 | |||||||||||||||||||||||
Vested | (1,915,326 | ) | 42.35 | ||||||||||||||||||||||
Forfeited | (418,127 | ) | 48.53 | ||||||||||||||||||||||
Service-based share awards at February 28, 2014 | 5,373,308 | $ | 48.34 | ||||||||||||||||||||||
Granted | 2,994,553 | 53.23 | |||||||||||||||||||||||
Vested | (1,948,247 | ) | 47.24 | ||||||||||||||||||||||
Forfeited | (569,952 | ) | 48.5 | ||||||||||||||||||||||
Restricted shares issued as part of a business combination with continued-employment service conditions (1) | 529,057 | 54.75 | |||||||||||||||||||||||
Service-based share awards at February 28, 2015 | 6,378,719 | $ | 51.49 | ||||||||||||||||||||||
-1 | As part of the Company’s acquisition of eNovance, a total of 529,057 restricted common shares were issued to certain shareholders of eNovance. These restricted shares are conditioned on continued employment with the Company. The shares effectively vest 25% per year and are being amortized on a straight-line basis to share-based compensation expense in the Company’s Consolidated Statement of Operations. | ||||||||||||||||||||||||
The following summarizes the intrinsic value, as of February 28, 2015, of the Company’s service-based awards outstanding and expected to vest: | |||||||||||||||||||||||||
Intrinsic Value of | Number of | Weighted Average | Intrinsic Value at | ||||||||||||||||||||||
Service-based Awards | Shares and | Remaining | February 28, 2015 | ||||||||||||||||||||||
Share Units | Vesting Period | (in thousands) | |||||||||||||||||||||||
Outstanding | 6,378,719 | 2.8 | $ | 440,897 | |||||||||||||||||||||
Expected to vest (assuming annual forfeiture rate of 10%) | 5,464,591 | 2.8 | $ | 377,713 | |||||||||||||||||||||
The intrinsic value of service-based awards vesting during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total intrinsic value of service-based awards vesting | $ | 108,066 | $ | 88,969 | $ | 118,299 | |||||||||||||||||||
As of February 28, 2015, compensation cost related to service-based share awards not yet recognized in the Company’s Consolidated Financial Statements totaled $242.5 million. The weighted average period over which these nonvested awards are expected to be recognized is approximately 2.8 years. | |||||||||||||||||||||||||
Performance-based share awards | |||||||||||||||||||||||||
Under the 2004 Plan, certain executive officers and senior management were awarded a target number of performance share units (“PSUs”). The PSU payouts are either based on (i) the Company’s financial performance (“performance condition”) or (ii) the performance of the Company’s common stock (“market condition”). Set forth below are general descriptions of the two types of performance-based awards granted to certain executive officers and members of senior management. | |||||||||||||||||||||||||
PSUs with performance conditions | |||||||||||||||||||||||||
Depending on the Company’s financial performance measured against the financial performance of specified peer companies during a three-year performance period, PSU grantees may earn up to 200% of the target number of PSUs (the “Maximum PSUs”). Payouts are earned over a performance period with two separate performance segments (or three separate performance segments for grants prior to fiscal 2014). Up to 50% of the Maximum PSUs may be earned in respect of the first performance segment; and up to 100% of the Maximum PSUs may be earned in respect of the second performance segment, less the amount earned in the first performance segment. | |||||||||||||||||||||||||
PSUs with market conditions | |||||||||||||||||||||||||
Depending on the performance of the Company’s common stock over a performance period of approximately three years, PSU grantees may earn up to 200% of the target number of PSUs. The number of PSUs earned is determined based on a comparison of the performance of the Company’s total shareholder return (or share price for grants prior to fiscal 2014) relative to the performance of the total shareholder return (or share price for grants prior to fiscal 2014) of specified peer companies during the same performance period. Each grantee will receive a number of shares of common stock equal to the number of PSUs earned in a single payout following the end of the performance period. | |||||||||||||||||||||||||
In addition to the PSUs with the market condition described above, certain executives were awarded a total of 242,352 PSUs that will pay out only if the Company’s total shareholder return increases by at least 50% within a three-year performance period beginning on August 6, 2014 (“TSR Hurdle PSUs”). If the performance goal is achieved during the performance period and the grantee’s business relationship with the Company has not ceased, 50% of the TSR Hurdle PSU’s shall vest upon achievement of the performance goal and the remaining 50% of the TSR Hurdle PSUs shall vest on the last day of the four-year service period beginning on August 6, 2014. If the performance goal is not met on or before the last day of the performance period, then all TSR Hurdle PSUs are forfeited. | |||||||||||||||||||||||||
The following table summarizes the activity for the Company’s PSUs for the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | |||||||||||||||||||||||||
Maximum | |||||||||||||||||||||||||
Activity | Shares | Weighted Average | |||||||||||||||||||||||
Underlying | Grant Date | ||||||||||||||||||||||||
Performance | Fair Value | ||||||||||||||||||||||||
Share Units | |||||||||||||||||||||||||
Outstanding at February 29, 2012 | 1,725,607 | $ | 31.6 | ||||||||||||||||||||||
Granted | 613,800 | 52.23 | |||||||||||||||||||||||
Vested | (634,384 | ) | 23.62 | ||||||||||||||||||||||
Forfeited | (200,353 | ) | 32.81 | ||||||||||||||||||||||
Outstanding at February 28, 2013 | 1,504,670 | $ | 43.22 | ||||||||||||||||||||||
Granted | 671,448 | 47.86 | |||||||||||||||||||||||
Vested | (399,334 | ) | 33.47 | ||||||||||||||||||||||
Forfeited | (101,559 | ) | 44.34 | ||||||||||||||||||||||
Outstanding at February 28, 2014 | 1,675,225 | $ | 47.34 | ||||||||||||||||||||||
Granted | 1,148,084 | 52.17 | |||||||||||||||||||||||
Vested | (374,921 | ) | 45.42 | ||||||||||||||||||||||
Forfeited | (299,053 | ) | 41.9 | ||||||||||||||||||||||
Outstanding at February 28, 2015 | 2,149,335 | $ | 51.01 | ||||||||||||||||||||||
Vested and forfeited amounts represent the actual number of shares vesting and forfeited during the year. Outstanding amounts represent the remaining maximum potential shares available to vest as of the period ended. | |||||||||||||||||||||||||
The total fair value of performance-based share awards recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total fair value of performance-based awards recognized | $ | 22,260 | $ | 19,185 | $ | 19,447 | |||||||||||||||||||
The total intrinsic value of performance-based share awards vesting during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | |||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total intrinsic value of performance-based awards vesting | $ | 18,733 | $ | 19,639 | $ | 37,872 | |||||||||||||||||||
As of February 28, 2015, the number of shares subject to PSU awards expected to vest was 1.3 million shares. Compensation expense related to PSUs expected to vest but not yet recognized in the Consolidated Financial Statements totaled $27.1 million as of February 28, 2015. The weighted average period over which these awards are expected to be recognized is approximately 2.3 years. |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Commitments and Contingencies | NOTE 14—Commitments and Contingencies | ||||||||||||
Operating leases | |||||||||||||
As of February 28, 2015, the Company leased office space and certain equipment under various non-cancelable operating leases. Future minimum lease payments required under the operating leases at February 28, 2015 are as follows (in thousands): | |||||||||||||
Fiscal Year | Operating | ||||||||||||
Leases | |||||||||||||
2016 | $ | 31,330 | |||||||||||
2017 | 25,973 | ||||||||||||
2018 | 20,679 | ||||||||||||
2019 | 17,737 | ||||||||||||
2020 | 15,862 | ||||||||||||
Thereafter | 87,490 | ||||||||||||
Total minimum lease payments | $ | 199,071 | |||||||||||
Rent expense under operating leases for the fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013 is provided in the following table (in thousands): | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Total operating lease expense | $ | 30,869 | $ | 29,472 | $ | 26,830 | |||||||
Product indemnification | |||||||||||||
The Company is a party to a variety of agreements pursuant to which it may be obligated to indemnify the other party from losses arising in connection with the Company’s services or products, or from losses arising in connection with certain events defined within a particular contract, which may include litigation or claims relating to intellectual property infringement, certain losses arising from damage to property or injury to persons or other matters. In each of these circumstances, payment by the Company is conditioned on the other party making a claim pursuant to the procedures specified in the particular contract, which procedures typically allow the Company to challenge the other party’s claims. Further, the Company’s obligations under these agreements may in certain cases be limited in terms of time and/or amount, and in some instances, the Company may have recourse against third-parties for certain payments made by the Company. | |||||||||||||
It is not possible to predict the maximum potential amount of future payments under these or similar agreements due to the conditional nature of the Company’s obligations and the facts and circumstances involved in each particular agreement. The Company does not record a liability for claims related to indemnification unless the Company concludes that the likelihood of a material claim is probable and estimable. Payments pursuant to these indemnification claims during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 were in the aggregate immaterial. |
Legal_Proceedings
Legal Proceedings | 12 Months Ended |
Feb. 28, 2015 | |
Legal Proceedings | NOTE 15—Legal Proceedings |
The Company experiences routine litigation in the normal course of its business, including patent litigation. The Company presently believes that the outcome of this routine litigation will not have a material adverse effect on its financial position, results of operations or cash flows. |
Employee_Benefit_Plans
Employee Benefit Plans | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Employee Benefit Plans | NOTE 16—Employee Benefit Plans | ||||||||||||
The Company provides retirement plans whereby participants may elect to contribute a portion of their annual compensation to the plans, after complying with certain limitations. The Company has the option to make contributions to the plans and contributed to the plans for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 as follows (in thousands): | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Total contributions to employee benefit plans | $ | 21,721 | $ | 17,613 | $ | 14,695 | |||||||
Share_Repurchase_Programs
Share Repurchase Programs | 12 Months Ended |
Feb. 28, 2015 | |
Share Repurchase Programs | NOTE 17—Share Repurchase Programs |
On April 15, 2013, the Company announced that its Board of Directors has authorized the repurchase of up to $300.0 million of Red Hat’s common stock from time to time on the open market or in privately negotiated transactions. The program commenced on April 16, 2013 and expired on March 31, 2015. | |
As of February 28, 2015, the Company had repurchased 4,401,206 shares of its common stock for $220.0 million under this program. See NOTE 25—Subsequent Events for a discussion of the Company’s new share repurchase program. | |
Accelerated share repurchase | |
The Company used $375.0 million of the net proceeds from the issuance of the convertible notes discussed in NOTE 22—Convertible Notes to the Company’s Consolidated Financial Statements during the fiscal year ended February 28, 2015 to repurchase shares of its common stock under an accelerated share repurchase program (the “ASR Agreement”). On October 7, 2014, under the ASR Agreement, the Company paid $375.0 million to the ASR Agreement counterparty and received 5,312,555 shares of its common stock from the ASR Agreement counterparty, which represented 80% of the shares the Company would have repurchased assuming an average share price of $56.47 (the Company’s closing share price at October 1, 2014). The ASR Agreement was completed on February 27, 2015. On March 4, 2015, the ASR Agreement counterparty delivered 720,101 additional shares of the Company’s common stock to the Company in settlement of the ASR Agreement. | |
The Company accounted for the ASR Agreement as two separate transactions: (i) the 5,312,555 shares of common stock initially delivered to the Company were accounted for as a treasury stock transaction with $300.0 million, or 80%, of the $375.0 million upfront payment being recorded in Treasury stock in the Company’s Consolidated Balance Sheet at February 28, 2015 and (ii) the unsettled portion of the ASR Agreement of $75.0 million was recorded in Additional paid-in capital on the Company’s Consolidated Balance Sheet as of February 28, 2015. The $75.0 million recorded in Additional paid-in capital will be reclassified to Treasury stock in the first quarter of fiscal year 2016 to reflect the March 4, 2015 settlement of the additional 720,101 shares of the Company’s common stock. |
Assets_and_Liabilities_Measure
Assets and Liabilities Measured at Fair Value on a Recurring Basis | 12 Months Ended | ||||||||||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||||||||||
Assets and Liabilities Measured at Fair Value on a Recurring Basis | NOTE 18—Assets and Liabilities Measured at Fair Value on a Recurring Basis | ||||||||||||||||||||||||||||
The following table summarizes the composition and fair value hierarchy of the Company’s financial assets and liabilities at February 28, 2015 (in thousands): | |||||||||||||||||||||||||||||
As of | Quoted Prices In | Significant | Significant | ||||||||||||||||||||||||||
February 28, | Active Markets | Other | Unobservable | ||||||||||||||||||||||||||
2015 | for Identical | Observable | Inputs (Level 3) | ||||||||||||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Money markets (1) | $ | 369,926 | $ | 369,926 | $ | — | $ | — | |||||||||||||||||||||
Interest-bearing deposits (1) | 39 | — | 39 | — | |||||||||||||||||||||||||
Available-for-sale securities (1): | |||||||||||||||||||||||||||||
Commercial paper | 29,994 | — | 29,994 | — | |||||||||||||||||||||||||
U.S. agency securities | 276,287 | — | 276,287 | — | |||||||||||||||||||||||||
Corporate securities | 421,200 | — | 421,200 | — | |||||||||||||||||||||||||
Foreign government securities | 63,744 | — | 63,744 | — | |||||||||||||||||||||||||
Foreign currency derivatives (2) | 74 | — | 74 | — | |||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Foreign currency derivatives (3) | (738 | ) | — | (738 | ) | — | |||||||||||||||||||||||
Total | $ | 1,160,526 | $ | 369,926 | $ | 790,600 | $ | — | |||||||||||||||||||||
-1 | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company’s Consolidated Balance Sheet at February 28, 2015 in addition to $647.6 million of cash. | ||||||||||||||||||||||||||||
-2 | Included in Other current assets in the Company’s Consolidated Balance Sheet at February 28, 2015. | ||||||||||||||||||||||||||||
-3 | Included in Accounts payable and accrued expenses in the Company’s Consolidated Balance Sheet at February 28, 2015. | ||||||||||||||||||||||||||||
The following table summarizes the composition and fair value hierarchy of the Company’s financial assets and liabilities at February 28, 2014 (in thousands): | |||||||||||||||||||||||||||||
As of | Quoted Prices In | Significant | Significant | ||||||||||||||||||||||||||
February 28, | Active Markets | Other | Unobservable | ||||||||||||||||||||||||||
2014 | for Identical | Observable | Inputs (Level 3) | ||||||||||||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Money markets (1) | $ | 178,280 | $ | 178,280 | $ | — | $ | — | |||||||||||||||||||||
Interest-bearing deposits (1) | 86,937 | — | 86,937 | — | |||||||||||||||||||||||||
Available-for-sale securities (1): | |||||||||||||||||||||||||||||
Commercial paper | 37,643 | — | 37,643 | — | |||||||||||||||||||||||||
U.S. agency securities | 279,049 | — | 279,049 | — | |||||||||||||||||||||||||
Corporate securities | 382,516 | — | 382,516 | — | |||||||||||||||||||||||||
Foreign government securities | 79,841 | — | 79,841 | — | |||||||||||||||||||||||||
Foreign currency derivatives (2) | 134 | 134 | |||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Foreign currency derivatives (3) | (15 | ) | — | (15 | ) | — | |||||||||||||||||||||||
Total | $ | 1,044,385 | $ | 178,280 | $ | 866,105 | $ | — | |||||||||||||||||||||
-1 | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company’s Consolidated Balance Sheet at February 28, 2014, in addition to $443.2 million of cash. | ||||||||||||||||||||||||||||
-2 | Included in Other current assets in the Company’s Consolidated Balance Sheet at February 28, 2014. | ||||||||||||||||||||||||||||
-3 | Included in Accounts payable and accrued expenses in the Company’s Consolidated Balance Sheet at February 28, 2014. | ||||||||||||||||||||||||||||
The following table represents the Company’s investments measured at fair value as of February 28, 2015 (in thousands): | |||||||||||||||||||||||||||||
Balance Sheet Classification | |||||||||||||||||||||||||||||
Amortized | Gross Unrealized | Aggregate | Cash | Investments | Investments | ||||||||||||||||||||||||
Equivalent | in debt | in debt | |||||||||||||||||||||||||||
Marketable | securities, | securities, | |||||||||||||||||||||||||||
Cost | Gains | Losses(1) | Fair Value | Securities | short-term | long-term | |||||||||||||||||||||||
Money markets | $ | 369,926 | $ | — | $ | — | $ | 369,926 | $ | 369,926 | $ | — | $ | — | |||||||||||||||
Interest-bearing deposits | 39 | — | — | 39 | — | 39 | — | ||||||||||||||||||||||
Commercial paper | 29,994 | — | — | 29,994 | 29,994 | — | — | ||||||||||||||||||||||
U.S. agency securities | 276,928 | 13 | (654 | ) | 276,287 | — | 5,002 | 271,285 | |||||||||||||||||||||
Corporate securities | 420,431 | 1,219 | (450 | ) | 421,200 | — | 146,469 | 274,731 | |||||||||||||||||||||
Foreign government securities | 63,687 | 59 | (2 | ) | 63,744 | — | 63,744 | — | |||||||||||||||||||||
Total | $ | 1,161,005 | $ | 1,291 | $ | (1,106 | ) | $ | 1,161,190 | $ | 399,920 | $ | 215,254 | $ | 546,016 | ||||||||||||||
-1 | As of February 28, 2015, there were $0.3 million of accumulated unrealized losses related to investments that have been in a continuous unrealized loss position for 12 months or longer. | ||||||||||||||||||||||||||||
The following table summarizes the stated maturities of the Company’s investment in available-for-sale securities at February 28, 2015 (in thousands): | |||||||||||||||||||||||||||||
Total | Less than | 1-3 Years | 3-5 Years | More than | |||||||||||||||||||||||||
1 Year | 5 Years | ||||||||||||||||||||||||||||
Maturity of current and long-term available-for-sale securities | $ | 791,225 | $ | 245,209 | $ | 396,325 | $ | 149,691 | $ | — | |||||||||||||||||||
The following table represents the Company’s investments measured at fair value as of February 28, 2014 (in thousands): | |||||||||||||||||||||||||||||
Balance Sheet Classification | |||||||||||||||||||||||||||||
Amortized | Gross Unrealized | Aggregate | Cash | Investments | Investments | ||||||||||||||||||||||||
Equivalent | in debt | in debt | |||||||||||||||||||||||||||
Marketable | securities, | securities, | |||||||||||||||||||||||||||
Cost | Gains | Losses(1) | Fair Value | Securities | short-term | long-term | |||||||||||||||||||||||
Money markets | $ | 178,280 | $ | — | $ | — | $ | 178,280 | $ | 178,280 | $ | — | $ | — | |||||||||||||||
Interest-bearing deposits | 86,937 | — | — | 86,937 | — | 86,937 | — | ||||||||||||||||||||||
Commercial paper | 37,643 | — | — | 37,643 | 25,299 | 12,344 | — | ||||||||||||||||||||||
U.S. agency securities | 279,657 | 12 | (620 | ) | 279,049 | — | 56,314 | 222,735 | |||||||||||||||||||||
Corporate securities | 381,446 | 1,279 | (209 | ) | 382,516 | — | 131,612 | 250,904 | |||||||||||||||||||||
Foreign government securities | 79,818 | 34 | (11 | ) | 79,841 | — | 48,180 | 31,661 | |||||||||||||||||||||
Total | $ | 1,043,781 | $ | 1,325 | $ | (840 | ) | $ | 1,044,266 | $ | 203,579 | $ | 335,387 | $ | 505,300 | ||||||||||||||
-1 | As of February 28, 2014, there were $0.2 million of accumulated unrealized losses related to investments that have been in a continuous unrealized loss position for 12 months or longer. |
Earnings_Per_Share
Earnings Per Share | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Earnings Per Share | NOTE 19—Earnings Per Share | ||||||||||||
The following table reconciles the numerators and denominators of the earnings per share calculation for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands, except per share amounts): | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Net income, basic and diluted | $ | 180,201 | $ | 178,292 | $ | 150,204 | |||||||
Weighted average common shares outstanding | 186,529 | 189,920 | 193,147 | ||||||||||
Incremental shares attributable to assumed vesting or exercise of outstanding equity award shares | 2,717 | 2,116 | 2,657 | ||||||||||
Diluted shares | 189,246 | 192,036 | 195,804 | ||||||||||
Net income per share - diluted | $ | 0.95 | $ | 0.93 | $ | 0.77 | |||||||
The weighted average number of shares outstanding used in the computation of basic and diluted earnings per share for the fiscal year ended February 28, 2015 does not include the effect of common stock potentially issuable in accordance with the terms of the Company’s convertible notes and warrants. The effects of these potentially outstanding shares were not included in the calculation of diluted earnings per share because the effect would have been anti-dilutive. | |||||||||||||
With respect to the Company’s convertible notes, the Company has the option to pay cash or deliver, as the case may be, either cash, shares of its common stock or combination of cash and shares of its common stock for the aggregate amount due upon conversion of the convertible notes. The Company’s intent is to settle the principal amount of the convertible notes in cash upon conversion. As a result, upon conversion of the convertible notes, only the amounts payable in excess of the principal amounts of the convertible notes would be considered in diluted earnings per share under the treasury stock method. See NOTE 22—Convertible Notes to the Company’s Consolidated Financial Statements for detailed information on the convertible notes. | |||||||||||||
The following share awards are not included in the computation of diluted earnings per share because the aggregate value of proceeds considered received upon either exercise or vesting was greater than the average market price of the Company’s common stock during the related periods and the effect of including such share awards in the computation would be anti-dilutive (in thousands): | |||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Number of shares considered anti-dilutive for calculating diluted EPS | 121 | 360 | 77 | ||||||||||
Segment_Reporting
Segment Reporting | 12 Months Ended | ||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||
Segment Reporting | NOTE 20—Segment Reporting | ||||||||||||||||||||
The following summarizes revenue from unaffiliated customers, income (loss) from operations, total cash, cash equivalents and available-for-sale investment securities and total assets by geographic segment at and for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | |||||||||||||||||||||
Americas | EMEA | Asia Pacific | Corporate(1) | Consolidated | |||||||||||||||||
Year ended February 28, 2015 | |||||||||||||||||||||
Revenue from unaffiliated customers | $ | 1,144,237 | $ | 410,299 | $ | 234,953 | $ | — | $ | 1,789,489 | |||||||||||
Income (loss) from operations | $ | 242,173 | $ | 89,364 | $ | 53,689 | $ | (135,232 | ) | $ | 249,994 | ||||||||||
Total cash, cash equivalents and available-for-sale investment securities | $ | 1,267,824 | $ | 405,114 | $ | 135,805 | $ | — | $ | 1,808,743 | |||||||||||
Total assets | $ | 2,773,754 | $ | 726,213 | $ | 303,018 | $ | — | $ | 3,802,985 | |||||||||||
Year ended February 28, 2014 | |||||||||||||||||||||
Revenue from unaffiliated customers | $ | 974,655 | $ | 352,935 | $ | 207,025 | $ | — | $ | 1,534,615 | |||||||||||
Income (loss) from operations | $ | 199,254 | $ | 94,949 | $ | 51,860 | $ | (113,774 | ) | $ | 232,289 | ||||||||||
Total cash, cash equivalents and available-for-sale investment securities | $ | 808,830 | $ | 517,397 | $ | 161,202 | $ | — | $ | 1,487,429 | |||||||||||
Total assets | $ | 2,153,828 | $ | 703,929 | $ | 248,862 | $ | — | $ | 3,106,619 | |||||||||||
Year ended February 28, 2013 | |||||||||||||||||||||
Revenue from unaffiliated customers | $ | 855,214 | $ | 284,922 | $ | 188,681 | $ | — | $ | 1,328,817 | |||||||||||
Income (loss) from operations | $ | 181,136 | $ | 72,440 | $ | 46,160 | $ | (98,698 | ) | $ | 201,038 | ||||||||||
Total cash, cash equivalents and available-for-sale investment securities | $ | 825,906 | $ | 370,174 | $ | 122,293 | $ | — | $ | 1,318,373 | |||||||||||
Total assets | $ | 2,068,879 | $ | 534,093 | $ | 210,688 | $ | — | $ | 2,813,660 | |||||||||||
-1 | Amounts represent share-based compensation expense for each of the three fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013, which was not allocated to geographic segments. | ||||||||||||||||||||
Supplemental information about geographic areas | |||||||||||||||||||||
The following table lists, for the years ended February 28, 2015, February 28, 2014 and February 28, 2013, revenue from unaffiliated customers in the United States, the Company’s country of domicile, and revenue from foreign countries (in thousands): | |||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||
United States, the Company’s country of domicile | $ | 1,022,803 | $ | 848,053 | $ | 753,898 | |||||||||||||||
Foreign | 766,686 | 686,562 | 574,919 | ||||||||||||||||||
Total revenue from unaffiliated customers | $ | 1,789,489 | $ | 1,534,615 | $ | 1,328,817 | |||||||||||||||
There were no individual foreign countries in which the Company earned 10% or more of its revenue from unaffiliated customers. | |||||||||||||||||||||
Total tangible long-lived assets located in the United States, the Company’s country of domicile, and similar tangible long-lived assets held outside the U.S. are summarized in the following table for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | |||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||
United States, the Company’s country of domicile | $ | 131,792 | $ | 137,356 | $ | 105,029 | |||||||||||||||
Foreign | 40,359 | 36,561 | 36,557 | ||||||||||||||||||
Total tangible long-lived assets | $ | 172,151 | $ | 173,917 | $ | 141,586 | |||||||||||||||
Supplemental information about major customers | |||||||||||||||||||||
For the years ended February 28, 2015, February 28, 2014 and February 28, 2013, there were no individual customers from which the Company generated 10% or greater revenue. | |||||||||||||||||||||
Supplemental information about products and services | |||||||||||||||||||||
The following table, for each of the fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013, provides further detail, by type, of our subscription and services revenues. Infrastructure-related offerings subscription revenue includes subscription revenue generated from Red Hat Enterprise Linux and related technologies such as Red Hat Enterprise Virtualization. Subscription revenue generated from our Application development-related and other emerging technology offerings includes Red Hat JBoss Middleware, Red Hat Storage Technologies and Red Hat cloud offerings such as Red Hat Enterprise Linux OpenStack Platform and OpenShift by Red Hat (in thousands): | |||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||
Subscription revenue: | |||||||||||||||||||||
Infrastructure-related offerings | $ | 1,324,693 | $ | 1,171,103 | $ | 1,027,983 | |||||||||||||||
Application development-related and other emerging technology offerings | 236,541 | 165,668 | 120,358 | ||||||||||||||||||
Total subscription revenue | 1,561,234 | 1,336,771 | 1,148,341 | ||||||||||||||||||
Training and services revenue: | |||||||||||||||||||||
Consulting services | 171,436 | 145,191 | 129,363 | ||||||||||||||||||
Training | 56,819 | 52,653 | 51,113 | ||||||||||||||||||
Total training and services revenue | 228,255 | 197,844 | 180,476 | ||||||||||||||||||
Total revenue | $ | 1,789,489 | $ | 1,534,615 | $ | 1,328,817 | |||||||||||||||
Other_LongTerm_Obligations
Other Long-Term Obligations | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Other Long-Term Obligations | NOTE 21—Other Long-Term Obligations | ||||||||
Other long-term obligations were comprised of the following (in thousands): | |||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Accrued income taxes | $ | 57,083 | $ | 45,645 | |||||
Deferred rent credits | 12,992 | 10,879 | |||||||
Net non-current deferred tax liability (See NOTE 11—Income Taxes) | 6,109 | 27,541 | |||||||
Other | 1,156 | 938 | |||||||
Other long-term obligations | $ | 77,340 | $ | 85,003 | |||||
Convertible_Notes
Convertible Notes | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Convertible Notes | NOTE 22—Convertible Notes | ||||||||
Convertible note offering | |||||||||
On October 7, 2014, the Company completed its offering of $805.0 million aggregate principal amount of its 0.25% Convertible Senior Notes due 2019 (the “convertible notes”). The convertible notes were sold in a private placement under a purchase agreement, dated as of October 1, 2014, entered into by and among the Company and the Initial Purchasers, for resale to qualified institutional buyers pursuant to Rule 144A under the Securities Act. | |||||||||
The Company used $148.0 million of the net proceeds from the offering of the convertible notes to pay the cost of the privately-negotiated convertible note hedge transactions described below. The Company received proceeds of $79.8 million from the sale of warrants pursuant to the warrant transactions described below. | |||||||||
In addition, the Company used $375.0 million of the net proceeds from the offering of the convertible notes to repurchase shares of its common stock under an accelerated share repurchase program pursuant to an agreement that the Company entered into on October 1, 2014, as described in NOTE 17—Share Repurchase Programs to the Company’s Consolidated Financial Statements. | |||||||||
The Company intends to use the remaining net proceeds from the offering for working capital and other general corporate purposes, which may include capital expenditures, potential acquisitions or strategic transactions. | |||||||||
Indenture | |||||||||
On October 7, 2014, the Company entered into an indenture (the “Indenture”) with respect to the convertible notes with U.S. Bank National Association, as trustee (the “Trustee”). Under the Indenture, the convertible notes will be senior unsecured obligations of the Company and bear interest at a rate of 0.25% per year, payable semiannually in arrears on April 1 and October 1 of each year, beginning on April 1, 2015. The convertible notes will mature on October 1, 2019, unless previously purchased or converted. | |||||||||
The convertible notes are convertible into shares of the Company’s common stock at an initial conversion rate of 13.6219 shares per $1,000 principal amount of convertible notes (which is equivalent to an initial conversion price of approximately $73.41 per share), subject to adjustment upon the occurrence of certain events. The initial conversion price represents a premium of approximately 30% to the $56.47 per share closing price of the Company’s common stock on October 1, 2014. Upon conversion of the convertible notes, holders will receive cash or shares of the Company’s common stock or a combination thereof, at the Company’s election. | |||||||||
Prior to April 1, 2019, the convertible notes will be convertible only upon the occurrence of certain circumstances, and will be convertible thereafter at any time until the close of business on the second scheduled trading day immediately preceding the maturity date of the convertible notes. | |||||||||
The conversion rate is subject to customary anti-dilution adjustments. If certain corporate events described in the Indenture occur prior to the maturity date, the conversion rate will be increased for a holder who elects to convert its convertible notes in connection with such corporate event in certain circumstances. | |||||||||
The convertible notes are not redeemable prior to maturity, and no sinking fund is provided for the convertible notes. If the Company undergoes a “fundamental change,” as defined in the Indenture, subject to certain conditions, holders may require the Company to purchase for cash all or any portion of their convertible notes. The fundamental change purchase price will be 100% of the principal amount of the convertible notes to be purchased plus any accrued and unpaid special interest up to but excluding the fundamental change purchase date. | |||||||||
The Indenture contains customary terms and covenants, including that upon certain events of default occurring and continuing, either the Trustee or the holders of at least 25% in principal amount of the outstanding convertible notes may declare 100% of the principal of, and accrued and unpaid interest, if any, on, all the convertible notes to be due and payable. | |||||||||
In accounting for the issuance of the convertible notes, the Company separated the convertible notes into liability and equity components. The carrying amount of the liability component was calculated by measuring the estimated fair value of a similar liability that does not have an associated convertible feature. The carrying amount of the equity component representing the conversion option was determined by deducting the fair value of the liability component from the face value of the convertible notes as a whole. The excess of the face value of the convertible notes as a whole over the carrying amount of the liability component (the “debt discount”) is amortized to interest expense over the term of the convertible notes using the effective interest method with an effective interest rate of 2.86% per annum. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. | |||||||||
As of February 28, 2015, the convertible notes consisted of the following (in thousands): | |||||||||
February 28, | |||||||||
2015 | |||||||||
Liability component | |||||||||
Principal | $ | 805,000 | |||||||
Less: debt discount | (89,598 | ) | |||||||
Net carrying amount | $ | 715,402 | |||||||
Equity component (1) | $ | 96,890 | |||||||
-1 | Recorded in the Consolidated Balance Sheet in Additional paid-in capital. | ||||||||
In accounting for the transaction costs related to the convertible note issuance, the Company allocated the total amount incurred of $15.2 million to the liability and equity components based on their relative fair values. Issuance costs attributable to the liability component totaled $13.4 million and are being amortized to interest expense over the term of the convertible notes using the effective interest method. The remaining $1.8 million of issuance costs have been allocated to the equity component and are included in Additional paid-in capital on the Company’s Consolidated Balance Sheet as of February 28, 2015. Additionally, the Company recorded a deferred tax asset of $0.7 million related to the $1.8 million equity component of transactional costs which are deductible for tax purposes. | |||||||||
The following table includes total interest expense recognized related to the convertible notes for the fiscal year ended February 28, 2015 (in thousands): | |||||||||
Year ended | |||||||||
February 28, | |||||||||
2015 | |||||||||
Coupon rate 0.25% per year, payable semiannually | $ | 805 | |||||||
Amortization of convertible note issuance costs—liability component | 935 | ||||||||
Accretion of debt discount | 7,292 | ||||||||
Total interest expense related to convertible notes | $ | 9,032 | |||||||
The fair value of the convertible notes, which was determined based on inputs that are observable in the market (Level 2), and the carrying value of convertible notes (the carrying value excludes the equity component of the convertible notes classified in equity) is as follows (in thousands): | |||||||||
February 28, 2015 | |||||||||
Fair Value | Carrying Value | ||||||||
Convertible notes | $ | 722,029 | $ | 715,402 | |||||
Convertible note hedge transactions and warrant transactions | |||||||||
On October 1, 2014, the Company entered into convertible note hedge transactions and warrant transactions with certain of the Initial Purchasers of the convertible notes or their respective affiliates (the “Option Counterparties”). | |||||||||
The convertible note hedge transactions are expected to offset the potential dilution with respect to shares of the Company’s common stock upon any conversion of the convertible notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the converted notes, as the case may be. To partially offset the $148.0 million cost of the convertible note hedge transactions, the Company issued warrants and received proceeds of $79.8 million. The number of shares of the Company’s common stock underlying the warrants total 10,965,630, the same number of shares underlying the convertible notes and the convertible note hedge transactions. The combination of the convertible note hedge transactions and the warrant transactions effectively increases the initial conversion price of the convertible notes from $73.41 per share to $101.65 per share. As a result, the warrant transactions will have a dilutive effect with respect to the Company’s common stock to the extent that the market price per share of the Company’s common stock, as measured under the terms of the warrant transactions, exceeds the $101.65 strike price of the warrants. However, subject to certain conditions, the Company may elect to settle all of the warrants in cash. The $101.65 strike price of the warrants represents a premium of approximately 80% over the $56.47 per share closing price of the Company’s common stock on October 1, 2014. | |||||||||
The purchase of convertible note hedges and proceeds from issuance of warrants were recorded in stockholders’ equity and will continue to be classified as stockholders’ equity. |
Accumulated_Other_Comprehensiv
Accumulated Other Comprehensive Loss | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Accumulated Other Comprehensive Loss | NOTE 23—Accumulated Other Comprehensive Loss | ||||||||
Accumulated other comprehensive loss was comprised of the following (in thousands): | |||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Accumulated loss from foreign currency translation adjustment | $ | (60,986 | ) | $ | (4,823 | ) | |||
Accumulated unrealized gain, net of tax, on available-for-sale securities | 365 | 364 | |||||||
Accumulated other comprehensive loss | $ | (60,621 | ) | $ | (4,459 | ) | |||
Unaudited_Quarterly_Results
Unaudited Quarterly Results | 12 Months Ended | ||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||
Unaudited Quarterly Results | NOTE 24—Unaudited Quarterly Results | ||||||||||||||||
Below are unaudited condensed quarterly results for the year ended February 28, 2015: | |||||||||||||||||
Year ended February 28, 2015 | |||||||||||||||||
(Unaudited) | |||||||||||||||||
4th | 3rd | 2nd | 1st | ||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||
(in thousands, except per share data) | |||||||||||||||||
Revenue: | |||||||||||||||||
Subscriptions | $ | 405,072 | $ | 394,699 | $ | 389,495 | $ | 371,968 | |||||||||
Training and services | 58,869 | 61,196 | 56,404 | 51,786 | |||||||||||||
Total subscription and training and services revenue | $ | 463,941 | $ | 455,895 | $ | 445,899 | $ | 423,754 | |||||||||
Gross profit | $ | 393,724 | $ | 384,530 | $ | 378,725 | $ | 359,311 | |||||||||
Income from operations | $ | 67,607 | $ | 67,197 | $ | 64,227 | $ | 50,963 | |||||||||
Interest income | $ | 2,288 | $ | 2,196 | $ | 2,010 | $ | 1,842 | |||||||||
Interest expense | $ | 5,803 | $ | 3,441 | $ | 97 | $ | 53 | |||||||||
Other income (expense), net | $ | 4,785 | $ | 1,559 | $ | (192 | ) | $ | 410 | ||||||||
Net income, basic and diluted | $ | 47,700 | $ | 47,933 | $ | 46,823 | $ | 37,745 | |||||||||
Net income per common share (1): | |||||||||||||||||
Basic | $ | 0.26 | $ | 0.26 | $ | 0.25 | $ | 0.2 | |||||||||
Diluted | $ | 0.26 | $ | 0.26 | $ | 0.25 | $ | 0.2 | |||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 183,459 | 185,039 | 188,162 | 189,372 | |||||||||||||
Diluted | 186,307 | 187,674 | 190,755 | 191,457 | |||||||||||||
-1 | Earnings per common share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly per common share information may not equal the reported annual earnings per common share. | ||||||||||||||||
Below are unaudited condensed quarterly results for the year ended February 28, 2014: | |||||||||||||||||
Year ended February 28, 2014 | |||||||||||||||||
(Unaudited) | |||||||||||||||||
4th | 3rd | 2nd | 1st | ||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||
(in thousands, except per share data) | |||||||||||||||||
Revenue: | |||||||||||||||||
Subscriptions | $ | 351,492 | $ | 342,770 | $ | 326,692 | $ | 315,817 | |||||||||
Training and services | 48,905 | 53,766 | 47,731 | 47,442 | |||||||||||||
Total subscription and training and services revenue | $ | 400,397 | $ | 396,536 | $ | 374,423 | $ | 363,259 | |||||||||
Gross profit | $ | 339,861 | $ | 336,109 | $ | 318,843 | $ | 307,202 | |||||||||
Income from operations | $ | 59,300 | $ | 60,792 | $ | 55,574 | $ | 56,623 | |||||||||
Interest income | $ | 2,037 | $ | 1,579 | $ | 1,527 | $ | 1,502 | |||||||||
Interest expense | $ | 46 | $ | 51 | $ | 29 | $ | 34 | |||||||||
Other income (expense), net | $ | 328 | $ | (389 | ) | $ | 1,225 | $ | (390 | ) | |||||||
Net income, basic and diluted | $ | 45,068 | $ | 52,025 | $ | 40,808 | $ | 40,391 | |||||||||
Net income per common share (1): | |||||||||||||||||
Basic | $ | 0.24 | $ | 0.27 | $ | 0.22 | $ | 0.21 | |||||||||
Diluted | $ | 0.24 | $ | 0.27 | $ | 0.21 | $ | 0.21 | |||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 189,604 | 189,514 | 189,437 | 191,114 | |||||||||||||
Diluted | 191,712 | 191,365 | 191,432 | 192,969 | |||||||||||||
-1 | Earnings per common share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly per common share information may not equal the reported annual earnings per common share. |
Subsequent_Events
Subsequent Events | 12 Months Ended |
Feb. 28, 2015 | |
Subsequent Events | NOTE 25—Subsequent Events |
On March 4, 2015, the Company received 720,101 shares of its common stock in final settlement of the ASR Agreement discussed in NOTE 17—Share Repurchase Programs. | |
On March 25, 2015, the Company announced that its Board of Directors authorized the repurchase of up to $500.0 million of Red Hat’s common stock from time to time on the open market or in privately negotiated transactions. The new program, which replaced the previous repurchase program, commenced on April 1, 2015, and will expire on the earlier of (i) March 31, 2017, or (ii) a determination by the Board, Chief Executive Officer or Chief Financial Officer to discontinue the program. |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Feb. 28, 2015 | |
Basis of presentation | Basis of presentation |
The accompanying Consolidated Financial Statements include the accounts of the Company and all of its wholly-owned subsidiaries. All significant inter-company accounts and transactions are eliminated in consolidation. There are no significant foreign exchange restrictions on the Company’s foreign subsidiaries. | |
Use of estimates | Use of estimates |
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from such estimates. | |
Revenue recognition | Revenue recognition |
The Company establishes persuasive evidence of a sales arrangement for each type of revenue transaction based on either a signed contract with the end customer, a click-through contract on the Company’s website whereby the customer agrees to the Company’s standard subscription terms, signed or click-through distribution contracts with original equipment manufacturers (“OEMs”) and other resellers, or, in the case of individual training seats, through receipt of payment which indicates acceptance of the Company’s training agreement terms. | |
Subscription revenue | |
Subscription revenue is comprised of direct and indirect sales of subscriptions relating to Red Hat technologies. Accounts receivable and deferred revenue are recorded at the time a customer enters into a binding subscription agreement for the purchase of a subscription, subscription services are made available to the customer and the customer is billed. The deferred revenue amount is recognized as revenue ratably over the life of the subscription. Red Hat technologies are generally offered with either one or three-year base subscription periods; the majority of the Company’s subscriptions have one-year terms. Under these subscription agreements, renewal rates are generally specified for one or three-year renewal terms. Subscriptions generally entitle the end user to the technology itself and post-contract customer support, generally consisting of varying levels of support services as well as access to security errata, fixes, functionality enhancements to the technology and upgrades to new versions of the technologies, each on a when-and-if available basis, during the term of the subscription. The Company sells its offerings through two principal channels: (1) direct, which includes sales by the Company’s sales force as well as web store sales, and (2) indirect, which includes cloud service providers, distributors, value added resellers, systems integrators and OEMs. The Company recognizes revenue from the sale of Red Hat technologies ratably over the period of the subscription beginning on the commencement date of the subscription agreement. | |
Subscription arrangements with large enterprise customers often have contracts with multiple elements (e.g., software technology, support, training, consulting and other services). The Company allocates revenue to each element of the arrangement based on vendor-specific objective evidence of each element’s fair value when the Company can demonstrate sufficient evidence of the fair value of at least those elements that are undelivered. The fair value of each element in multiple element arrangements is created by either (i) providing the customer with the ability during the term of the arrangement to renew that element at the same rate paid for the element included in the initial term of the agreement or (ii) selling the element on a stand-alone basis. | |
Training and services revenue | |
Training and services revenue is comprised of revenue for consulting, engineering and customer training and education services. Consulting services consist of time-based arrangements, and revenue is recognized as these services are performed. Engineering services represent revenue earned under fixed fee arrangements with the Company’s OEM partners and other customers to provide for significant modification and customization of Red Hat technologies. The Company recognizes revenue for these fixed fee engineering services using the percentage of completion basis of accounting, provided the Company has the ability to make reliable estimates of progress towards completion, the fee for such services is fixed or determinable and collection of the resulting receivable is probable. Under the percentage of completion method, earnings under the contract are recognized based on the progress toward completion as estimated using the ratio of labor hours incurred to total expected project hours. Changes in estimates are recognized in the period in which they are known. Revenue for customer training and education services is recognized on the dates the services are complete. | |
Deferred selling costs | Deferred selling costs |
Deferred commissions are the incremental costs that are directly associated with non-cancelable subscription contracts with customers and consist of sales commissions paid to the Company’s sales force. The commissions are deferred and amortized over a period that approximates the period of the subscription term. The commission payments are paid in full subsequent to the month in which the customer’s service commences. The deferred commission amounts are recoverable through the future revenue streams under the non-cancelable customer contracts. In addition, the Company has the ability and intent under the commission plans with its sales force to recover commissions previously paid to its sales force in the event that customers breach the terms of their subscription agreements and do not fully pay for their subscription agreements. Deferred commissions are included in prepaid expenses on the accompanying Consolidated Balance Sheets. Amortization of deferred commissions is included in sales and marketing expense in the accompanying Consolidated Statements of Operations. | |
Goodwill and other long-lived assets | Goodwill and other long-lived assets |
Goodwill | |
The Company tests goodwill for impairment annually. For the years ended February 28, 2015 and February 28, 2014, the Company applied its test for goodwill impairment as permitted by ASU 2011-08, which allows the Company to first assess qualitative factors to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying value. The outcome of these qualitative tests determines whether it is necessary for a company to perform the two-step goodwill impairment test as required in years prior to the adoption of ASU 2011-08. | |
After considering such qualitative factors as macroeconomic conditions, actual or anticipated changes to cost factors (for example, selling and delivery), overall financial performance and other Company-specific factors, such as potential changes in strategy, the Company determined that it was not more likely than not that any impairment to goodwill had occurred during the years ended February 28, 2015 and February 28, 2014. Consequently, the Company was not required to perform the remaining two-step quantitative goodwill impairment test. | |
Other long-lived assets | |
The Company evaluates the recoverability of its property and equipment and other long-lived assets whenever events or changes in circumstances indicate that an impairment may have occurred. An impairment loss is recognized when the net book value of such assets exceeds the estimated future undiscounted cash flows attributable to the assets or the business to which the assets relate. Impairment losses, if any, are measured as the amount by which the carrying value exceeds the fair value of the assets. | |
See NOTE 7—Other Assets, Net for further discussion of impairment losses on long-lived assets for the years ended February 28, 2015, February 28, 2014 and February 28, 2013. | |
Cash and cash equivalents | Cash and cash equivalents |
The Company considers highly liquid investments purchased with a maturity period of three months or less at the date of purchase to be cash equivalents. | |
Accounts receivable and allowance for doubtful accounts | Accounts receivable and allowance for doubtful accounts |
Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s estimate of the amount of probable credit losses in the Company’s existing accounts receivable. The Company determines the allowance based on historical write-off experience. The Company reviews its allowance for doubtful accounts monthly. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. All other balances are reviewed on a pooled basis by type of receivable. Account balances are charged off against the allowance when the Company determines it is probable the receivable will not be recovered. The Company does not have off-balance sheet credit exposure related to its customers. See NOTE 4—Accounts Receivable for further discussion on accounts receivable balances. | |
Fair value measurements | Fair value measurements |
Fair value is defined as the exchange price that would be received for the purchase of an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for such asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value should maximize the use of observable inputs and minimize the use of unobservable inputs. To measure fair value, the Company uses the following fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable: | |
Level 1—Quoted prices in active markets for identical assets or liabilities. | |
Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. | |
Level 3—Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets or liabilities. | |
The Company’s investments are comprised primarily of debt securities that are classified as available for sale and recorded at their fair market values. Liquid investments with effective maturities of three months or less at the date of purchase are classified as cash equivalents. Investments with remaining effective maturities of twelve months or less from the balance sheet date are classified as short-term investments. Investments with remaining effective maturities of more than twelve months from the balance sheet date are classified as long-term investments. The Company’s Level 1 financial instruments are valued using quoted prices in active markets for identical instruments. The Company’s Level 2 financial instruments, including derivative instruments, are valued using quoted prices for identical instruments in less active markets or using other observable market inputs for comparable instruments. | |
Unrealized gains and temporary losses on investments classified as available for sale are included within accumulated other comprehensive income, net of any related tax effect. Upon realization, such amounts are reclassified from accumulated other comprehensive income to other income, net. Realized gains and losses and other than temporary impairments, if any, are reflected in the statements of operations as other income, net. The Company does not recognize changes in the fair value of its investments in income unless a decline in value is considered other than temporary. The vast majority of the Company’s investments are priced by pricing vendors. These pricing vendors use the most recent observable market information in pricing these securities or, if specific prices are not available for these securities, use other observable inputs. In the event observable inputs are not available, the Company assesses other factors to determine the security’s market value, including broker quotes or model valuations. Independent price verifications of all holdings are performed by pricing vendors which are then reviewed by the Company. In the event a price fails a pre-established tolerance check, it is researched so that the Company can assess the cause of the variance to determine what the Company believes is the appropriate fair market value. See NOTE 18—Assets and Liabilities Measured at Fair Value on a Recurring Basis for further discussion on fair value measurements. | |
The Company minimizes its credit risk associated with investments by investing primarily in investment grade, liquid securities. The Company’s policy is designed to limit exposures to any one issuer depending on credit quality. Periodic evaluations of the relative credit standing of those issuers are considered in the Company’s investment strategy. | |
Internal use software | Internal use software |
The Company capitalizes costs related to the development of internal use software for its website, enterprise resource planning system and systems management applications. The Company amortizes the costs of computer software developed for internal use on a straight-line basis over an estimated useful life of five years. The carrying value of internal use software is included in property and equipment on the Company’s Consolidated Balance Sheets. | |
Capitalized software costs | Capitalized software costs |
Capitalization of software development costs for products to be sold to third parties begins upon the establishment of technological feasibility and ceases when the product is available for general release. As a result of the Company’s practice of releasing source code that it has developed on a weekly basis for unrestricted download on the Internet, there is generally no passage of time between achievement of technological feasibility and the availability of the Company’s product for general release. Therefore, at February 28, 2015 and February 28, 2014, the Company had no internally developed capitalized software costs for products to be sold to third parties. | |
Property and equipment | Property and equipment |
Property and equipment is primarily comprised of furniture, computer equipment, computer software and leasehold improvements, which are recorded at cost and depreciated or amortized using the straight-line method over their estimated useful lives as follows: furniture and fixtures, seven years; computer equipment, three to four years; computer software, five years; leasehold improvements, over the lesser of the estimated remaining useful life of the asset or the remaining term of the lease. Expenditures for maintenance and repairs are charged to operations as incurred; major expenditures for renewals and betterments are capitalized and depreciated. Property and equipment acquired under capital leases are depreciated over the lesser of the estimated remaining useful life of the asset or the remaining term of the lease. | |
Share-based compensation | Share-based compensation |
The Company measures share-based compensation cost at grant date, based on the estimated fair value of the award and recognizes the cost over the employee requisite service period typically on a straight-line basis, net of estimated forfeitures. The Company estimates the fair value of stock options using the Black-Scholes-Merton valuation model. The fair value of nonvested share awards, nonvested share units and performance share units (PSUs”) are measured at their underlying closing share price on the date of grant. The Company’s share-based compensation is described further in NOTE 13—Share-based Awards. | |
Sales and marketing expenses | Sales and marketing expenses |
Sales and marketing expenses consist of costs, including salaries, sales commissions and related expenses, such as travel, of all personnel involved in the sales and marketing process. Sales and marketing expenses also include costs of advertising, sales lead generation programs, cooperative marketing arrangements and trade shows. Payments made to resellers or other customers are recognized as a reduction of revenue unless the Company (i) receives an identifiable benefit (goods or services) in exchange for such payments that is sufficiently separable from the purchase of the Company’s products and (ii) the Company can reasonably estimate the fair value of the benefit identified. Advertising costs are expensed as incurred. | |
Advertising expense totaled $62.6 million, $53.4 million and $42.7 million for the years ended February 28, 2015, February 28, 2014 and February 28, 2013, respectively. | |
Research and development expenses | Research and development expenses |
Research and development expenses include all direct costs, primarily salaries for Company personnel and outside consultants, related to the development of new software products, significant enhancements to existing software products, and the portion of costs of development of internal use software required to be expensed. Research and development costs are charged to operations as incurred with the exception of those software development costs that may qualify for capitalization. | |
Income taxes | Income taxes |
The Company accounts for income taxes using the liability method in which deferred tax assets or liabilities are recognized for the temporary differences between financial reporting and tax bases of the Company’s assets and liabilities and for tax carryforwards at enacted statutory tax rates in effect for the years in which the differences are expected to reverse. | |
The Company continues to assess the realizability of its deferred tax assets, which primarily consist of share-based compensation expense deductions, tax credit carryforwards and deferred revenue. In assessing the realizability of these deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The Company continues to maintain a valuation allowance against its deferred tax assets with respect to certain foreign net operating loss (“NOL”) carryforwards. | |
With respect to foreign earnings, it is the Company’s policy to invest the earnings of foreign subsidiaries indefinitely outside the U.S. From time to time, however, the Company may remit a portion of these earnings to the extent it incurs no additional U.S. tax and it is otherwise feasible. | |
Because tax laws are complex and subject to different interpretations, significant judgment is required. As a result, the Company makes certain estimates and assumptions in (i) calculating its income tax expense, deferred tax assets and deferred tax liabilities, (ii) determining any valuation allowance recorded against deferred tax assets and (iii) evaluating the amount of unrecognized tax benefits, as well as the interest and penalties related to such uncertain tax positions. The Company’s estimates and assumptions may differ significantly from tax benefits ultimately realized. The Company’s income tax expense and deferred taxes are described further in NOTE 11—Income Taxes. | |
Foreign currency translation | Foreign currency translation |
The Euro has been determined to be the primary functional currency for the Company’s European operations and local currencies have been determined to be the functional currencies for the Company’s Asia Pacific and Latin American operations, with the exception of the Company’s operations in Mexico, where the functional currency is the U.S. dollar. Foreign exchange gains and losses, which result from the process of remeasuring foreign currency transactions into the appropriate functional currency, are included in other income, net in the Company’s Consolidated Statements of Operations. | |
The impact of changes in foreign currency exchange rates resulting from the translation of foreign currency financial statements into U.S. dollars for financial reporting purposes is included in other comprehensive income, which is a separate component of stockholders’ equity. Assets and liabilities are translated into U.S. dollars at exchange rates in effect at the balance sheet date. Income and expense items are translated at average rates for the period. | |
Customers and credit risk | Customers and credit risk |
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist principally of cash, cash equivalents, investments and trade receivables. The Company primarily places its cash, cash equivalents and investments with high-credit quality financial institutions which invest predominantly in U.S. government instruments, investment grade corporate bonds and certificates of deposit guaranteed by banks which are members of the Federal Deposit Insurance Corporation. Cash deposits are primarily in financial institutions in the U.S. and the United Kingdom. However, cash for monthly operating costs of international operations are deposited in banks outside the U.S. | |
The Company performs credit evaluations to reduce credit risk and generally requires no collateral from its customers. Management estimates the allowance for uncollectible accounts based on their historical experience and credit evaluation. The Company’s standard credit terms are net 30 days in North America, net 30 to 45 days in EMEA (Europe, Middle East and Africa) and Latin America, and range from net 30 to net 60 days in Asia Pacific. | |
Net income per common share | Net income per common share |
The Company computes basic net income per common share by dividing net income available to common stockholders by the weighted average number of common shares outstanding. Diluted net income per common share is computed by dividing net income by the weighted average number of common shares and dilutive potential common share equivalents then outstanding. Potential common share equivalents consist of shares issuable upon the exercise of stock options or vesting of share-based awards. | |
With respect to the Company’s 0.25% convertible senior notes due 2019 (the “convertible notes”), the Company has the option to pay cash or deliver, as the case may be, either cash, shares of its common stock or combination of cash and shares of its common stock for the aggregate amount due upon conversion of the convertible notes. The Company’s intent is to settle the principal amount of the convertible notes in cash upon conversion. As a result, upon conversion of the convertible notes, only the amounts payable in excess of the principal amounts of the convertible notes would be considered in diluted earnings per share under the treasury stock method. See NOTE 22—Convertible Notes to the Company’s Consolidated Financial Statements for detailed information on the convertible notes. | |
Segment reporting | Segment reporting |
The Company is organized primarily on the basis of three geographic business units: the Americas (U.S., Latin America and Canada), EMEA (Europe, Middle East and Africa) and Asia Pacific. These business units are aggregated into one reportable segment due to the similarity in nature of products and services provided, financial performance economic characteristics (e.g., revenue growth and gross margin), methods of production and distribution and customer classes (e.g., cloud service providers, distributors, resellers and enterprise). | |
The Company has offices in more than 85 locations around the world. The Company manages its international business on an Americas-wide, EMEA-wide and Asia Pacific-wide basis. See NOTE 20—Segment Reporting for further discussion. | |
Recent accounting pronouncements | Recent accounting pronouncements |
In April 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update 2015-03, Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs (“ASU 2015-03”). The FASB issued ASU 2015-03 to simplify the presentation of debt issuance costs related to a recognized debt liability to present the debt issuance costs as a direct deduction from the carrying value of the debt liability rather than showing the debt issuance costs as a deferred charge on the balance sheet. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2015, and is effective for the Company as of the first quarter of the fiscal year ending February 28, 2017. The Company does not believe that this updated standard will have a material impact on the Company’s consolidated financial statements. | |
In June 2014, the FASB issued Accounting Standards Update 2014-12, Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period (“ASU 2014-12”). The FASB issued ASU 2014-12 to provide explicit guidance for share-based awards which allow for an employee to vest in an award upon achievement of a performance condition met after completion of a requisite service period regardless of whether the employee is rendering service on the date the performance target is achieved. ASU 2014-12 provides that the performance target should not be reflected in estimating the grant-date fair value of the award but rather compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and recognized prospectively over the remaining requisite service period. This guidance is effective for fiscal years and interim periods within those years beginning after December 15, 2015, and is effective for the Company as of the first quarter of the fiscal year ending February 28, 2017. The Company has not issued such share-based awards and does not believe that this updated standard will have a material impact on the Company’s consolidated financial statements. | |
In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers (“ASU 2014-09”). The FASB issued ASU 2014-09 to clarify the principles for recognizing revenue and to develop a common revenue standard for generally accepted accounting principles (“GAAP”) and International Financial Reporting Standards. The standard outlines a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes the most current revenue recognition guidance. This guidance is currently effective for fiscal years and interim periods within those years beginning after December 15, 2016, which is effective for the Company as of the first quarter of the fiscal year ending February 28, 2018. The FASB has proposed, but has not yet ratified, a one year deferral of ASU 2014-09. The Company is evaluating the impact that the implementation of this standard will have on the Company’s consolidated financial statements. | |
In July 2013, the FASB issued Accounting Standards Update No. 2013-11, Income Taxes (Topic 740)—Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists (“ASU 2013-11”), to eliminate diversity in practice of presenting unrecognized tax benefits as a liability or presenting unrecognized tax benefits as a reduction of a deferred tax asset for a net operating loss or tax credit carryforward in certain circumstances by requiring that an unrecognized tax benefit be presented in the financial statements as a reduction to deferred tax assets excluding certain exceptions. ASU 2013-11 became effective for the Company during the three months ended May 31, 2014. The updated standard did not have a material impact on the Company’s consolidated financial statements. | |
In March 2013, the FASB issued Accounting Standards Update No. 2013-05, Foreign Currency Matters (Topic 830)—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 (“ASU 2013-05”), which requires a parent entity to release a related foreign entity’s cumulative translation adjustment into net income only if its sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. ASU 2013-05 became effective for the Company during the three months ended May 31, 2014. The updated standard did not have a material impact on the Company’s consolidated financial statements. |
Business_Combinations_Tables
Business Combinations (Tables) | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Summary of Changes in Goodwill | The following is a summary of goodwill for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | ||||||||||||
Balance at February 29, 2012 | $ | 591,563 | |||||||||||
Acquisition of ManageIQ | 83,074 | ||||||||||||
Other acquisitions | 17,462 | ||||||||||||
Impact of foreign currency fluctuations and other adjustments | (1,188 | ) | |||||||||||
Balance at February 28, 2013 | $ | 690,911 | |||||||||||
Final purchase price allocation adjustment for ManageIQ | (3,164 | ) | |||||||||||
Impact of foreign currency fluctuations | (317 | ) | |||||||||||
Balance at February 28, 2014 | $ | 687,430 | |||||||||||
Acquisition of Inktank | 131,446 | ||||||||||||
Acquisition of eNovance | 60,849 | ||||||||||||
Acquisition of FeedHenry | 68,491 | ||||||||||||
Impact of foreign currency fluctuations | (21,156 | ) | |||||||||||
Balance at February 28, 2015 | $ | 927,060 | |||||||||||
Inktank Storage, Inc. | |||||||||||||
Summary of Consideration Transferred in Connection With Acquisition | The total consideration transferred by the Company in connection with the acquisition is summarized in the following table (in thousands): | ||||||||||||
Total | |||||||||||||
Consideration | |||||||||||||
Transferred | |||||||||||||
Cash consideration paid to and/or on behalf of holders of Inktank stock and vested options | $ | 151,648 | |||||||||||
Fair value of nonvested employee share-based awards assumed and attributed to pre-combination services (1) | 895 | ||||||||||||
Total consideration transferred (2) | $ | 152,543 | |||||||||||
-1 | The total fair value, as of April 30, 2014, of all assumed nonvested share-based awards was $10.6 million, of which $0.9 million has been attributed to pre-acquisition employee services and accordingly has been recognized as consideration transferred. The remaining $9.7 million of fair value will be recognized as compensation expense over the remaining vesting period ranging from 1 month to approximately 4 years. | ||||||||||||
-2 | In addition to the cash consideration transferred of $151.6 million and the assumed nonvested share-based awards with an acquisition-date fair value of $10.6 million, the Company committed to pay retention incentives totaling $8.4 million in cash (payable 25% annually from the date of acquisition assuming continued employment). The Company also awarded to key employees share-based awards with a combined grant value of $15.0 million which will vest 25% annually from the date of grant. | ||||||||||||
Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed | The table below represents the tangible and identifiable intangible assets acquired and liabilities assumed (in thousands): | ||||||||||||
Total | |||||||||||||
Consideration | |||||||||||||
Allocated | |||||||||||||
Identifiable intangible assets (see detail below) | $ | 10,770 | |||||||||||
Cash | 27 | ||||||||||||
Accounts receivable | 746 | ||||||||||||
Deferred tax assets, net | 12,060 | ||||||||||||
Other assets | 161 | ||||||||||||
Accrued liabilities | (1,651 | ) | |||||||||||
Deferred revenue | (1,016 | ) | |||||||||||
Goodwill | 131,446 | ||||||||||||
Total consideration allocated | $ | 152,543 | |||||||||||
Summary of Allocation of Identifiable Intangible Asset Resulting from Acquisition | The following table summarizes the allocation of consideration transferred to identifiable intangible assets (in thousands). The fair value of the identifiable intangible assets is being amortized over the estimated useful life of each intangible asset on a straight-line basis which approximates the economic pattern of benefits: | ||||||||||||
Amortization Expense Type | Estimated Life | Total | |||||||||||
(Years) | |||||||||||||
Customer relationships | Sales and marketing | 5 | $ | 6,800 | |||||||||
Tradenames and trademarks | General and administrative | Indefinite | 3,300 | ||||||||||
Covenants not to compete | Research and development | 3 | 370 | ||||||||||
Developed technology | Cost of revenue | 5 | 300 | ||||||||||
Total identifiable intangible assets | $ | 10,770 | |||||||||||
Feed Henry Enovance and Inktank Storage Inc | |||||||||||||
Post Acquisition Revenue, Expenses and Losses Included Company's Consolidated Statement of Operations | The following is a summary of the combined post-acquisition revenue, expenses and losses of FeedHenry, eNovance and Inktank that are included in the Company’s Consolidated Statement of Operations for the fiscal year ended February 28, 2015 (in thousands): | ||||||||||||
Year Ended | |||||||||||||
February 28, 2015 | |||||||||||||
Revenue | $ | 7,771 | |||||||||||
Operating expenses | (28,898 | ) | |||||||||||
Operating loss | (21,127 | ) | |||||||||||
Other income | 849 | ||||||||||||
Loss before tax benefit | (20,278 | ) | |||||||||||
Tax benefit | 5,982 | ||||||||||||
Net loss | $ | (14,296 | ) | ||||||||||
Pro Forma Consolidated Financial Information | The following unaudited pro forma consolidated financial information reflects the results of operations of the Company for the fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands, except per share amounts) as if all of the acquisitions completed during fiscal 2015 and fiscal 2013 had closed on March 1, 2012, after giving effect to certain purchase accounting adjustments. These pro forma results are not necessarily indicative of what the Company’s operating results would have been had the acquisitions actually taken place at the beginning of the period. | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Revenue | $ | 1,794,948 | $ | 1,551,301 | $ | 1,339,595 | |||||||
Net income | 174,991 | 150,870 | 116,944 | ||||||||||
Basic net income per common share | $ | 0.94 | $ | 0.79 | $ | 0.61 | |||||||
Diluted net income per common share | $ | 0.92 | $ | 0.79 | $ | 0.6 |
Accounts_Receivable_Tables
Accounts Receivable (Tables) | 12 Months Ended | ||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||
Activities In Allowance For Doubtful Accounts | Activity in the Company’s allowance for doubtful accounts for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 is presented in the following table (in thousands): | ||||||||||||||||
Balance at | Charged | Adjustments (1) | Balance at | ||||||||||||||
beginning | to (recovery of) | end of | |||||||||||||||
of period | expense | period | |||||||||||||||
2013 | $ | 1,877 | $ | (102 | ) | $ | (436 | ) | $ | 1,339 | |||||||
2014 | $ | 1,339 | $ | 841 | $ | (194 | ) | $ | 1,986 | ||||||||
2015 | $ | 1,986 | $ | 469 | $ | (208 | ) | $ | 2,247 | ||||||||
-1 | Represents foreign currency translation adjustments and amounts written-off as uncollectible accounts receivable. |
Property_and_Equipment_Tables
Property and Equipment (Tables) | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Schedule of Property and Equipment at Cost | The Company’s property and equipment is recorded at cost and consists of the following (in thousands): | ||||||||||||
February 28, | February 28, | ||||||||||||
2015 | 2014 | ||||||||||||
Computer equipment | $ | 141,972 | $ | 137,570 | |||||||||
Software, including software developed for internal use | 80,565 | 112,348 | |||||||||||
Furniture and fixtures | 28,595 | 28,007 | |||||||||||
Leasehold improvements | 100,882 | 96,410 | |||||||||||
Property and equipment—in progress | 10,251 | 8,877 | |||||||||||
Property and equipment | $ | 362,265 | $ | 383,212 | |||||||||
Less: accumulated depreciation | (190,114 | ) | (209,295 | ) | |||||||||
Property and equipment, net | $ | 172,151 | $ | 173,917 | |||||||||
Depreciation Expense Recognized in Consolidated Financial Statements | The useful lives of property and equipment range from three to fifteen years. Leasehold improvements are amortized over the lesser of the useful life or lease term. Depreciation expense recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 is summarized as follows (in thousands): | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Total depreciation expense | $ | 48,001 | $ | 45,169 | $ | 38,818 | |||||||
Identifiable_Intangible_Assets1
Identifiable Intangible Assets (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||||||
Summary of Identifiable Intangible Assets | The following is a summary of identifiable intangible assets (in thousands): | ||||||||||||||||||||||||
February 28, 2015 | February 28, 2014 | ||||||||||||||||||||||||
Gross | Accumulated | Net | Gross | Accumulated | Net | ||||||||||||||||||||
Amount | Amortization | Amount | Amount | Amortization | Amount | ||||||||||||||||||||
Trademarks, copyrights and patents | $ | 117,020 | $ | (42,630 | ) | $ | 74,390 | $ | 105,269 | $ | (34,784 | ) | $ | 70,485 | |||||||||||
Purchased technologies | 81,482 | (63,618 | ) | 17,864 | 79,433 | (55,960 | ) | 23,473 | |||||||||||||||||
Customer and reseller relationships | 104,084 | (71,512 | ) | 32,572 | 89,992 | (63,075 | ) | 26,917 | |||||||||||||||||
Covenants not to compete | 10,683 | (7,657 | ) | 3,026 | 10,690 | (5,977 | ) | 4,713 | |||||||||||||||||
Other intangible assets | 8,833 | (2,409 | ) | 6,424 | 8,922 | (1,111 | ) | 7,811 | |||||||||||||||||
Total identifiable intangible assets | $ | 322,102 | $ | (187,826 | ) | $ | 134,276 | $ | 294,306 | $ | (160,907 | ) | $ | 133,399 | |||||||||||
Schedule of Amortization Expense Associated with Identifiable Intangible Assets | Amortization expense associated with identifiable intangible assets recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 is summarized as follows (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Cost of revenue | $ | 12,049 | $ | 11,212 | $ | 5,943 | |||||||||||||||||||
Sales and marketing | 7,838 | 8,872 | 8,416 | ||||||||||||||||||||||
Research and development | 2,417 | 3,836 | 3,836 | ||||||||||||||||||||||
General and administrative | 5,958 | 5,316 | 5,328 | ||||||||||||||||||||||
Total amortization expense | $ | 28,262 | $ | 29,236 | $ | 23,523 | |||||||||||||||||||
Schedule of Amortization Expense | As of February 28, 2015, future amortization expense on existing intangibles is as follows (in thousands): | ||||||||||||||||||||||||
Fiscal Year | Amortization | ||||||||||||||||||||||||
Expense of | |||||||||||||||||||||||||
Intangible Assets | |||||||||||||||||||||||||
2016 | $ | 27,885 | |||||||||||||||||||||||
2017 | 25,209 | ||||||||||||||||||||||||
2018 | 21,477 | ||||||||||||||||||||||||
2019 | 15,161 | ||||||||||||||||||||||||
2020 | 11,072 | ||||||||||||||||||||||||
Thereafter | 22,184 | ||||||||||||||||||||||||
Total amortization expense | $ | 122,988 | |||||||||||||||||||||||
Other_Assets_Net_Tables
Other Assets, Net (Tables) | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Components of Other Assets, Net | Other assets, net were comprised of the following (in thousands): | ||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Cost-basis investments | $ | 28,154 | $ | 21,801 | |||||
Net non-current deferred tax asset (see NOTE 11—Income Taxes) | 18,049 | 7,655 | |||||||
Security deposits and other | 7,040 | 5,935 | |||||||
Other assets, net | $ | 53,243 | $ | 35,391 | |||||
Prepaid_Expenses_Tables
Prepaid Expenses (Tables) | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Schedule of Prepaid Expenses, Including Sales Commissions | Prepaid expenses, including sales commissions, were comprised of the following (in thousands): | ||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Deferred commissions | $ | 107,313 | $ | 80,987 | |||||
Professional services | 14,934 | 12,827 | |||||||
Taxes | 17,543 | 13,012 | |||||||
Insurance | 1,859 | 1,207 | |||||||
Other | 9,066 | 10,354 | |||||||
Prepaid expenses | $ | 150,715 | $ | 118,387 | |||||
Accounts_Payable_and_Accrued_E1
Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Summary of Accounts Payable and Accrued Expenses | Accounts payable and accrued expenses were comprised of the following (in thousands): | ||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Accounts payable | $ | 31,017 | $ | 18,326 | |||||
Accrued wages and other compensation related expenses | 126,378 | 100,474 | |||||||
Accrued other trade payables | 40,400 | 40,998 | |||||||
Accrued income and other taxes payable | 39,596 | 19,253 | |||||||
Accrued other | 342 | 417 | |||||||
Accounts payable and accrued expenses | $ | 237,733 | $ | 179,468 | |||||
Derivative_Instruments_Tables
Derivative Instruments (Tables) | 12 Months Ended | ||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||
Summary of Effects of Derivative Instruments | The effects of derivative instruments on the Company’s Consolidated Financial Statements are as follows as of February 28, 2015 and for the year then ended (in thousands): | ||||||||||||||||
Year ended February 28, 2015 | |||||||||||||||||
As of February 28, 2015 | Classification of Gain | Amount of Gain | |||||||||||||||
(Loss) Recognized | (Loss) Recognized | ||||||||||||||||
in Income on | in Income on | ||||||||||||||||
Balance | Fair | Notional | Derivatives | Derivatives | |||||||||||||
Sheet Classification | Value | Value | |||||||||||||||
Assets—foreign currency forward contracts not designated as hedges | Other current assets | $ | 74 | $ | 5,281 | Other income (expense), net | $ | 664 | |||||||||
Liabilities—foreign currency forward contracts not designated as hedges | Accounts payable and accrued expenses | (738 | ) | 102,836 | Other income (expense), net | (2,626 | ) | ||||||||||
TOTAL | $ | (664 | ) | $ | 108,117 | $ | (1,962 | ) | |||||||||
The effects of derivative instruments on the Company’s Consolidated Financial Statements are as follows as of February 28, 2014 and for the year then ended (in thousands): | |||||||||||||||||
Year ended February 28, 2014 | |||||||||||||||||
As of February 28, 2014 | Classification of Gain | Amount of Gain | |||||||||||||||
(Loss) Recognized | (Loss) Recognized | ||||||||||||||||
in Income on | in Income on | ||||||||||||||||
Balance | Fair | Notional | Derivatives | Derivatives | |||||||||||||
Sheet Classification | Value | Value | |||||||||||||||
Assets—foreign currency forward contracts not designated as hedges | Other current assets | $ | 134 | $ | 24,790 | Other income (expense), net | $ | 1,147 | |||||||||
Liabilities—foreign currency forward contracts not designated as hedges | Accounts payable and accrued expenses | (15 | ) | 3,546 | Other income (expense), net | (2,697 | ) | ||||||||||
TOTAL | $ | 119 | $ | 28,336 | $ | (1,550 | ) | ||||||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Schedule of U.S. and Foreign Components of Income Before Provision for Income Taxes | The U.S. and foreign components of the Company’s income before provision for income taxes consisted of the following (in thousands): | ||||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
U.S. | $ | 167,388 | $ | 135,371 | $ | 130,560 | |||||||
Foreign | 88,110 | 104,177 | 79,192 | ||||||||||
Income before provision for income taxes | $ | 255,498 | $ | 239,548 | $ | 209,752 | |||||||
Schedule of Components of Provision for Income Taxes | The components of the Company’s provision for income taxes consisted of the following (in thousands): | ||||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Current: | |||||||||||||
Foreign | $ | 26,325 | $ | 23,391 | $ | 16,556 | |||||||
Federal | 15,252 | 19,734 | 33,598 | ||||||||||
State | 4,090 | 7,147 | 1,882 | ||||||||||
Current tax expense | $ | 45,667 | $ | 50,272 | $ | 52,036 | |||||||
Deferred: | |||||||||||||
Foreign | (8,188 | ) | (1,100 | ) | 2,899 | ||||||||
Federal | 36,197 | 14,468 | 9,687 | ||||||||||
State | 1,621 | (2,384 | ) | (5,074 | ) | ||||||||
Deferred tax expense | $ | 29,630 | $ | 10,984 | $ | 7,512 | |||||||
Net provision for income taxes | $ | 75,297 | $ | 61,256 | $ | 59,548 | |||||||
Schedule of Deferred Tax Assets and Liabilities | Significant components of the Company’s deferred tax assets and liabilities at February 28, 2015 and February 28, 2014, consisted of the following (in thousands): | ||||||||||||
February 28, | February 28, | ||||||||||||
2015 | 2014 | ||||||||||||
Deferred tax assets: | |||||||||||||
Foreign net operating loss carryforwards | $ | 6,704 | $ | 4,016 | |||||||||
Domestic net operating loss carryforwards | 17,956 | 8,650 | |||||||||||
Domestic credit carryforwards | 8,990 | 24,045 | |||||||||||
Share-based compensation | 36,996 | 32,478 | |||||||||||
Deferred revenue | 68,850 | 49,749 | |||||||||||
Foreign deferred royalty expenses | 9,958 | 8,396 | |||||||||||
Convertible notes | 18,683 | — | |||||||||||
Other | 12,407 | 10,599 | |||||||||||
Total deferred tax assets | $ | 180,544 | $ | 137,933 | |||||||||
Valuation allowance for deferred tax assets | (2,641 | ) | (699 | ) | |||||||||
Total deferred tax assets, net of valuation allowance | $ | 177,903 | $ | 137,234 | |||||||||
Deferred tax liabilities: | |||||||||||||
Goodwill | 7,835 | 5,163 | |||||||||||
Fixed and intangible assets | 37,321 | 28,283 | |||||||||||
Compensation accruals | 23,518 | 12,738 | |||||||||||
Other | 11,152 | 3,342 | |||||||||||
Total deferred tax liabilities | $ | 79,826 | $ | 49,526 | |||||||||
Net deferred tax asset | $ | 98,077 | $ | 87,708 | |||||||||
Gross and Net Deferred Tax Assets and Liability Positions | The Company’s gross and net deferred tax asset and liability positions at February 28, 2015 are as follows (in thousands): | ||||||||||||
Domestic | Foreign | Consolidated | |||||||||||
Deferred tax assets: | |||||||||||||
Current | $ | 94,120 | $ | 24,330 | $ | 118,450 | |||||||
Non-current | 51,666 | 7,787 | 59,453 | ||||||||||
Deferred tax liabilities: | |||||||||||||
Current | 24,270 | 8,043 | 32,313 | ||||||||||
Non-current | 44,389 | 3,124 | 47,513 | ||||||||||
Net deferred tax asset | $ | 77,127 | $ | 20,950 | $ | 98,077 | |||||||
Net current deferred tax asset | $ | 69,850 | $ | 16,946 | $ | 86,796 | |||||||
Net non-current deferred tax asset, recorded in Other assets, net | 7,277 | 10,772 | 18,049 | ||||||||||
Net current deferred tax liability, recorded in Other current obligations | — | (659 | ) | (659 | ) | ||||||||
Net non-current deferred tax liability, recorded in Other long-term obligations | — | (6,109 | ) | (6,109 | ) | ||||||||
Net deferred tax asset | $ | 77,127 | $ | 20,950 | $ | 98,077 | |||||||
Reconciliation of Statutory Federal Income Tax Rates to Provision for Income Taxes | Taxes computed at the statutory federal income tax rates are reconciled to the provision for income taxes for the years ended February 28, 2015, February 28, 2014 and February 28, 2013, respectively, as follows (in thousands): | ||||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Effective rate | 29.5 | % | 25.6 | % | 28.4 | % | |||||||
Provision at federal statutory rate, 35% | $ | 89,424 | $ | 83,842 | $ | 73,413 | |||||||
State tax, net of federal tax benefit (1) | 4,042 | 3,169 | 907 | ||||||||||
Foreign rate differential | (11,124 | ) | (10,817 | ) | (7,034 | ) | |||||||
Israel tax holiday (2) | (2,859 | ) | (1,901 | ) | (1,806 | ) | |||||||
Foreign dividend | 8,720 | 623 | 5,787 | ||||||||||
Nondeductible items | 3,339 | 2,157 | 2,141 | ||||||||||
Research tax credit | (5,329 | ) | (3,070 | ) | (5,348 | ) | |||||||
Foreign tax credit | (11,755 | ) | (11,878 | ) | (7,852 | ) | |||||||
Domestic production activities deduction | (4,433 | ) | (4,973 | ) | — | ||||||||
Other | 5,272 | 4,104 | (660 | ) | |||||||||
Provision for income taxes | $ | 75,297 | $ | 61,256 | $ | 59,548 | |||||||
-1 | During the year ended February 28, 2013, the Company amended its state income tax returns for prior years, which resulted in a reduction of state tax, net of federal tax benefit, of $3.4 million. | ||||||||||||
-2 | The Company qualifies for a tax holiday in Israel which began during the fiscal year ended February 28, 2011 and is scheduled to terminate as of the fiscal year ending February 29, 2020. The tax holiday provides for an exemption from income tax in the first two years, and for a reduced rate of taxation on income generated in Israel for the subsequent eight years. The financial impact of this holiday for the year ended February 28, 2015 was a $2.9 million reduction in the Company’s provision for income taxes, which increased the Company’s diluted earnings per share by approximately $0.02. | ||||||||||||
Schedule of Unrecognized Tax Benefits | The following table reconciles unrecognized tax benefits for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | ||||||||||||
Balance at February 29, 2012 | $ | 43,762 | |||||||||||
Additions based on tax positions related to prior years | 2,122 | ||||||||||||
Additions based on tax positions related to the current year | 2,576 | ||||||||||||
Reductions related to changes in facts and circumstances | (147 | ) | |||||||||||
Balance at February 29, 2013 | $ | 48,313 | |||||||||||
Additions based on tax positions related to prior years | 100 | ||||||||||||
Additions based on tax positions related to the current year | 9,005 | ||||||||||||
Reductions related to settlements with tax authorities | (364 | ) | |||||||||||
Balance at February 28, 2014 | $ | 57,054 | |||||||||||
Additions based on tax positions related to prior years | 514 | ||||||||||||
Additions based on tax positions related to the current year | 3,374 | ||||||||||||
Reductions related to changes in facts and circumstances | (229 | ) | |||||||||||
Reductions related to lapse of the statute of limitations | (370 | ) | |||||||||||
Balance at February 28, 2015 | $ | 60,343 | |||||||||||
Summary of Tax Years Subject to Examination | The following table summarizes the tax years in the Company’s major tax jurisdictions that remain subject to income tax examinations by tax authorities as of February 28, 2015. Due to NOL carryforwards, in some cases the tax years continue to remain subject to examination with respect to such NOLs: | ||||||||||||
Tax Jurisdiction | Years Subject to | ||||||||||||
Income Tax | |||||||||||||
Examination | |||||||||||||
U.S. federal (1) | 1994 – Present | ||||||||||||
California | 2001 – Present | ||||||||||||
North Carolina | 1999 – Present | ||||||||||||
Massachusetts | 2008 – Present | ||||||||||||
Ireland | 2010 – Present | ||||||||||||
Japan (2) | 2012 – Present | ||||||||||||
-1 | The U.S. Internal Revenue Service has completed its examination with respect to the Company’s fiscal year ended February 28, 2010 and proposed certain adjustments. The Company believes that it has adequately provided for any reasonably foreseeable outcomes that may result from the proposed adjustments but, depending on the ultimate outcome, the Company could be required to pay additional income taxes. The Company does not believe that such outcome would have a material effect on its consolidated financial condition or consolidated results of operations. | ||||||||||||
-2 | The Company has been examined for income tax for years through February 28, 2011. A tax examination was concluded in fiscal 2012 with no significant adjustments resulting. However, the statute of limitations remains open for five years. |
Sharebased_Awards_Tables
Share-based Awards (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||||||
Summary of Share-Based Awards Granted During Period, by Type | The following table summarizes share-based awards, by type, granted during the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | ||||||||||||||||||||||||
Awards Granted | Awards Granted | Awards Granted | |||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, 2015 | February 28, 2014 | February 28, 2013 | |||||||||||||||||||||||
Shares and | Weighted | Shares and | Weighted | Shares and | Weighted | ||||||||||||||||||||
Shares | Average | Shares | Average | Shares | Average | ||||||||||||||||||||
Underlying | Per Share | Underlying | Per Share | Underlying | Per Share | ||||||||||||||||||||
Awards | Award | Awards | Award | Awards | Award | ||||||||||||||||||||
Fair Value | Fair Value | Fair Value | |||||||||||||||||||||||
Stock options | — | $ | — | 133,800 | $ | 12.64 | 114,361 | $ | 15.16 | ||||||||||||||||
Service-based shares and share units (1) | 2,994,553 | $ | 53.23 | 2,513,328 | $ | 47.43 | 2,471,872 | $ | 54.62 | ||||||||||||||||
Performance-based share units—Maximum | 1,148,084 | $ | 52.17 | 671,448 | $ | 47.86 | 613,800 | $ | 52.23 | ||||||||||||||||
Stock options assumed as part of a business combination | 219,169 | $ | 48.45 | — | $ | — | — | $ | — | ||||||||||||||||
Restricted shares issued as part of a business combination with continued-employment service conditions | 529,057 | $ | 54.75 | — | $ | — | — | $ | — | ||||||||||||||||
Total share-based awards | 4,890,863 | $ | 52.93 | 3,318,576 | $ | 46.11 | 3,200,033 | $ | 52.75 | ||||||||||||||||
-1 | Service-based shares granted during the year ended February 28, 2015 include 184,325 restricted shares awarded to certain executives that were subject to both a four-year service condition and the achievement of a specified dollar amount of revenue for fiscal year 2015 (the “RSA performance goal”). The RSA performance goal for fiscal year 2015 was met. Therefore, as of February 28, 2015 only the service condition remained, with 25% of such shares scheduled to vest vesting on July 16, 2015, one year from the date of grant, and the remainder vesting ratably on a quarterly basis over the course of the subsequent three-year period. | ||||||||||||||||||||||||
Share-Based Compensation Expense | The following summarizes share-based compensation expense recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Cost of revenue | $ | 14,027 | $ | 11,793 | $ | 9,433 | |||||||||||||||||||
Sales and marketing | 55,203 | 40,322 | 32,906 | ||||||||||||||||||||||
Research and development | 38,517 | 34,194 | 29,647 | ||||||||||||||||||||||
General and administrative | 27,485 | 27,465 | 26,712 | ||||||||||||||||||||||
Total share-based compensation expense | $ | 135,232 | $ | 113,774 | $ | 98,698 | |||||||||||||||||||
Total Fair Value of Stock Options Recognized | The total fair value of stock options recognized in the Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total fair value of stock options recognized | $ | 5,085 | $ | 2,139 | $ | 2,791 | |||||||||||||||||||
Summary of Stock Option Activity | The following table summarizes the activity for the Company’s stock options for the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | ||||||||||||||||||||||||
Shares Underlying | Weighted Average | ||||||||||||||||||||||||
Options | Exercise Price Per | ||||||||||||||||||||||||
Share | |||||||||||||||||||||||||
Outstanding at February 29, 2012 | 1,103,153 | $ | 16.21 | ||||||||||||||||||||||
Granted | 114,361 | 55.17 | |||||||||||||||||||||||
Exercised | (735,086 | ) | 15.61 | ||||||||||||||||||||||
Forfeited | (29,741 | ) | 25.1 | ||||||||||||||||||||||
Outstanding at February 28, 2013 | 452,687 | $ | 26.43 | ||||||||||||||||||||||
Granted | 133,800 | 47.12 | |||||||||||||||||||||||
Exercised | (175,026 | ) | 12.13 | ||||||||||||||||||||||
Forfeited | (34,840 | ) | 22.93 | ||||||||||||||||||||||
Outstanding at February 28, 2014 | 376,621 | $ | 40.75 | ||||||||||||||||||||||
Granted | — | — | |||||||||||||||||||||||
Exercised | (141,702 | ) | 17.18 | ||||||||||||||||||||||
Forfeited | (22,310 | ) | 28.69 | ||||||||||||||||||||||
Assumed (1) | 219,169 | 0.2 | |||||||||||||||||||||||
Outstanding at February 28, 2015 | 431,778 | $ | 28.53 | ||||||||||||||||||||||
-1 | Amount represents partially vested options assumed as part of a business combination. | ||||||||||||||||||||||||
Summary of Outstanding and Exercisable Stock Options | The following summarizes information, as of February 28, 2015, about the Company’s outstanding and exercisable stock options: | ||||||||||||||||||||||||
Options Outstanding | Options Exercisable | ||||||||||||||||||||||||
Exercise Prices | Number | Weighted | Weighted | Number | Weighted | ||||||||||||||||||||
Outstanding | Average | Average | Exercisable | Average | |||||||||||||||||||||
Remaining | Exercise Price | Exercise Price | |||||||||||||||||||||||
Contractual Life | |||||||||||||||||||||||||
$ 0.00 – $10.00 | 182,624 | 7.7 | $ | 0.33 | 56,976 | $ | 0.57 | ||||||||||||||||||
$10.01 – $20.00 | 3,130 | 0.9 | $ | 15.65 | 3,130 | $ | 15.65 | ||||||||||||||||||
$20.01 – $30.00 | — | — | $ | — | — | $ | — | ||||||||||||||||||
$30.01 – $40.00 | 11,667 | 0.6 | $ | 39.82 | 11,667 | $ | 39.82 | ||||||||||||||||||
$40.01 – $50.00 | 99,106 | 2.9 | $ | 44.23 | 40,288 | $ | 44.49 | ||||||||||||||||||
$50.01 and over | 135,251 | 2.7 | $ | 54.43 | 66,086 | $ | 54.92 | ||||||||||||||||||
Total | 431,778 | 4.8 | $ | 28.53 | 178,147 | $ | 33.5 | ||||||||||||||||||
Intrinsic Value of Outstanding, Exercisable and Expected to Vest Stock Options | The following summarizes the intrinsic value, as of February 28, 2015, of the Company’s outstanding, exercisable and expected to vest stock options: | ||||||||||||||||||||||||
Intrinsic Value of Stock Options | Number of | Weighted Average | Intrinsic Value at | ||||||||||||||||||||||
Stock Options | Remaining | February 28, 2015 | |||||||||||||||||||||||
Contractual Life | (in thousands) | ||||||||||||||||||||||||
Outstanding | 431,778 | 4.8 | $ | 17,526 | |||||||||||||||||||||
Exercisable | 178,147 | 3.7 | $ | 6,346 | |||||||||||||||||||||
Expected to vest (assuming annual forfeiture rate of 10%) | 227,474 | 5.6 | $ | 10,054 | |||||||||||||||||||||
Total Intrinsic Value of Stock Options Exercised | The intrinsic value of stock options exercised during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total intrinsic value of stock options exercised | $ | 6,289 | $ | 6,775 | $ | 29,598 | |||||||||||||||||||
Summary of Fair Value of Options Granted | The fair values of options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 were estimated on the date of grant or assumption using the Black-Scholes-Merton option-pricing model based on the following weighted average assumptions: | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Expected dividend yield | — | % | — | % | — | % | |||||||||||||||||||
Risk-free interest rate | 0.98 | % | 0.62 | % | 0.41 | % | |||||||||||||||||||
Expected volatility (1) | 36.39 | % | 36.8 | % | 38.13 | % | |||||||||||||||||||
Expected life (in years) (2) | 3.27 | 3.27 | 3.27 | ||||||||||||||||||||||
Weighted average fair value of options granted or assumed during the period | $ | 48.45 | $ | 12.64 | $ | 15.16 | |||||||||||||||||||
-1 | The expected volatility rates for options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 were estimated based on an approximate equal weighting of the historical volatility of the Company’s common stock over a period of approximately 3.27 years and the implied volatility of publicly traded options for the Company’s common stock. | ||||||||||||||||||||||||
-2 | The expected term for options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was determined based on the Company’s historical exercise data. The Company reassesses its estimate of expected term annually or when new information indicates a change is appropriate. | ||||||||||||||||||||||||
Service Based Share Units | |||||||||||||||||||||||||
Total Fair Value of Service/Performance-Based Awards Recognized | The total fair value of service-based share awards recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total fair value of service-based awards recognized | $ | 107,887 | $ | 92,450 | $ | 76,460 | |||||||||||||||||||
Activity for Service-Based Share Units | The following table summarizes the activity for the Company’s service-based share awards for the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | ||||||||||||||||||||||||
Nonvested | Weighted Average | ||||||||||||||||||||||||
Shares and | Grant-date | ||||||||||||||||||||||||
Share Units | Fair Value | ||||||||||||||||||||||||
Service-based share awards at February 29, 2012 | 5,486,639 | $ | 36.36 | ||||||||||||||||||||||
Granted | 2,471,872 | 54.62 | |||||||||||||||||||||||
Vested | (2,184,588 | ) | 31.33 | ||||||||||||||||||||||
Forfeited | (580,490 | ) | 41.56 | ||||||||||||||||||||||
Service-based share awards at February 28, 2013 | 5,193,433 | $ | 46.59 | ||||||||||||||||||||||
Granted | 2,513,328 | 47.43 | |||||||||||||||||||||||
Vested | (1,915,326 | ) | 42.35 | ||||||||||||||||||||||
Forfeited | (418,127 | ) | 48.53 | ||||||||||||||||||||||
Service-based share awards at February 28, 2014 | 5,373,308 | $ | 48.34 | ||||||||||||||||||||||
Granted | 2,994,553 | 53.23 | |||||||||||||||||||||||
Vested | (1,948,247 | ) | 47.24 | ||||||||||||||||||||||
Forfeited | (569,952 | ) | 48.5 | ||||||||||||||||||||||
Restricted shares issued as part of a business combination with continued-employment service conditions (1) | 529,057 | 54.75 | |||||||||||||||||||||||
Service-based share awards at February 28, 2015 | 6,378,719 | $ | 51.49 | ||||||||||||||||||||||
-1 | As part of the Company’s acquisition of eNovance, a total of 529,057 restricted common shares were issued to certain shareholders of eNovance. These restricted shares are conditioned on continued employment with the Company. The shares effectively vest 25% per year and are being amortized on a straight-line basis to share-based compensation expense in the Company’s Consolidated Statement of Operations. | ||||||||||||||||||||||||
Intrinsic Value of Service-Based Awards | The following summarizes the intrinsic value, as of February 28, 2015, of the Company’s service-based awards outstanding and expected to vest: | ||||||||||||||||||||||||
Intrinsic Value of | Number of | Weighted Average | Intrinsic Value at | ||||||||||||||||||||||
Service-based Awards | Shares and | Remaining | February 28, 2015 | ||||||||||||||||||||||
Share Units | Vesting Period | (in thousands) | |||||||||||||||||||||||
Outstanding | 6,378,719 | 2.8 | $ | 440,897 | |||||||||||||||||||||
Expected to vest (assuming annual forfeiture rate of 10%) | 5,464,591 | 2.8 | $ | 377,713 | |||||||||||||||||||||
Total Intrinsic Value of Service-Based Awards | The intrinsic value of service-based awards vesting during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total intrinsic value of service-based awards vesting | $ | 108,066 | $ | 88,969 | $ | 118,299 | |||||||||||||||||||
Performance Share Units | |||||||||||||||||||||||||
Total Fair Value of Service/Performance-Based Awards Recognized | The total fair value of performance-based share awards recognized in the Company’s Consolidated Financial Statements for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total fair value of performance-based awards recognized | $ | 22,260 | $ | 19,185 | $ | 19,447 | |||||||||||||||||||
Activity for Performance-Based Share Units | The following table summarizes the activity for the Company’s PSUs for the years ended February 28, 2015, February 28, 2014 and February 28, 2013: | ||||||||||||||||||||||||
Maximum | |||||||||||||||||||||||||
Activity | Shares | Weighted Average | |||||||||||||||||||||||
Underlying | Grant Date | ||||||||||||||||||||||||
Performance | Fair Value | ||||||||||||||||||||||||
Share Units | |||||||||||||||||||||||||
Outstanding at February 29, 2012 | 1,725,607 | $ | 31.6 | ||||||||||||||||||||||
Granted | 613,800 | 52.23 | |||||||||||||||||||||||
Vested | (634,384 | ) | 23.62 | ||||||||||||||||||||||
Forfeited | (200,353 | ) | 32.81 | ||||||||||||||||||||||
Outstanding at February 28, 2013 | 1,504,670 | $ | 43.22 | ||||||||||||||||||||||
Granted | 671,448 | 47.86 | |||||||||||||||||||||||
Vested | (399,334 | ) | 33.47 | ||||||||||||||||||||||
Forfeited | (101,559 | ) | 44.34 | ||||||||||||||||||||||
Outstanding at February 28, 2014 | 1,675,225 | $ | 47.34 | ||||||||||||||||||||||
Granted | 1,148,084 | 52.17 | |||||||||||||||||||||||
Vested | (374,921 | ) | 45.42 | ||||||||||||||||||||||
Forfeited | (299,053 | ) | 41.9 | ||||||||||||||||||||||
Outstanding at February 28, 2015 | 2,149,335 | $ | 51.01 | ||||||||||||||||||||||
Total Fair Value of Performance-Based Awards Vesting | The total intrinsic value of performance-based share awards vesting during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was as follows (in thousands): | ||||||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||||||
Total intrinsic value of performance-based awards vesting | $ | 18,733 | $ | 19,639 | $ | 37,872 | |||||||||||||||||||
Commitments_and_Contingencies_
Commitments and Contingencies (Tables) | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Schedule Of Future Minimum Lease Payments Required Under Operating Leases | As of February 28, 2015, the Company leased office space and certain equipment under various non-cancelable operating leases. Future minimum lease payments required under the operating leases at February 28, 2015 are as follows (in thousands): | ||||||||||||
Fiscal Year | Operating | ||||||||||||
Leases | |||||||||||||
2016 | $ | 31,330 | |||||||||||
2017 | 25,973 | ||||||||||||
2018 | 20,679 | ||||||||||||
2019 | 17,737 | ||||||||||||
2020 | 15,862 | ||||||||||||
Thereafter | 87,490 | ||||||||||||
Total minimum lease payments | $ | 199,071 | |||||||||||
Rent Expense Under Operating Leases | Rent expense under operating leases for the fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013 is provided in the following table (in thousands): | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Total operating lease expense | $ | 30,869 | $ | 29,472 | $ | 26,830 | |||||||
Employee_Benefit_Plans_Tables
Employee Benefit Plans (Tables) | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Schedule of Defined Benefit Plans Disclosures | The Company has the option to make contributions to the plans and contributed to the plans for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 as follows (in thousands): | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Total contributions to employee benefit plans | $ | 21,721 | $ | 17,613 | $ | 14,695 | |||||||
Assets_and_Liabilities_Measure1
Assets and Liabilities Measured at Fair Value on a Recurring Basis (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||||||||||
Fair Value of Assets and Liabilities Acquired | The following table summarizes the composition and fair value hierarchy of the Company’s financial assets and liabilities at February 28, 2015 (in thousands): | ||||||||||||||||||||||||||||
As of | Quoted Prices In | Significant | Significant | ||||||||||||||||||||||||||
February 28, | Active Markets | Other | Unobservable | ||||||||||||||||||||||||||
2015 | for Identical | Observable | Inputs (Level 3) | ||||||||||||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Money markets (1) | $ | 369,926 | $ | 369,926 | $ | — | $ | — | |||||||||||||||||||||
Interest-bearing deposits (1) | 39 | — | 39 | — | |||||||||||||||||||||||||
Available-for-sale securities (1): | |||||||||||||||||||||||||||||
Commercial paper | 29,994 | — | 29,994 | — | |||||||||||||||||||||||||
U.S. agency securities | 276,287 | — | 276,287 | — | |||||||||||||||||||||||||
Corporate securities | 421,200 | — | 421,200 | — | |||||||||||||||||||||||||
Foreign government securities | 63,744 | — | 63,744 | — | |||||||||||||||||||||||||
Foreign currency derivatives (2) | 74 | — | 74 | — | |||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Foreign currency derivatives (3) | (738 | ) | — | (738 | ) | — | |||||||||||||||||||||||
Total | $ | 1,160,526 | $ | 369,926 | $ | 790,600 | $ | — | |||||||||||||||||||||
-1 | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company’s Consolidated Balance Sheet at February 28, 2015 in addition to $647.6 million of cash. | ||||||||||||||||||||||||||||
-2 | Included in Other current assets in the Company’s Consolidated Balance Sheet at February 28, 2015. | ||||||||||||||||||||||||||||
-3 | Included in Accounts payable and accrued expenses in the Company’s Consolidated Balance Sheet at February 28, 2015. | ||||||||||||||||||||||||||||
The following table summarizes the composition and fair value hierarchy of the Company’s financial assets and liabilities at February 28, 2014 (in thousands): | |||||||||||||||||||||||||||||
As of | Quoted Prices In | Significant | Significant | ||||||||||||||||||||||||||
February 28, | Active Markets | Other | Unobservable | ||||||||||||||||||||||||||
2014 | for Identical | Observable | Inputs (Level 3) | ||||||||||||||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||
Money markets (1) | $ | 178,280 | $ | 178,280 | $ | — | $ | — | |||||||||||||||||||||
Interest-bearing deposits (1) | 86,937 | — | 86,937 | — | |||||||||||||||||||||||||
Available-for-sale securities (1): | |||||||||||||||||||||||||||||
Commercial paper | 37,643 | — | 37,643 | — | |||||||||||||||||||||||||
U.S. agency securities | 279,049 | — | 279,049 | — | |||||||||||||||||||||||||
Corporate securities | 382,516 | — | 382,516 | — | |||||||||||||||||||||||||
Foreign government securities | 79,841 | — | 79,841 | — | |||||||||||||||||||||||||
Foreign currency derivatives (2) | 134 | 134 | |||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||
Foreign currency derivatives (3) | (15 | ) | — | (15 | ) | — | |||||||||||||||||||||||
Total | $ | 1,044,385 | $ | 178,280 | $ | 866,105 | $ | — | |||||||||||||||||||||
-1 | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company’s Consolidated Balance Sheet at February 28, 2014, in addition to $443.2 million of cash. | ||||||||||||||||||||||||||||
-2 | Included in Other current assets in the Company’s Consolidated Balance Sheet at February 28, 2014. | ||||||||||||||||||||||||||||
-3 | Included in Accounts payable and accrued expenses in the Company’s Consolidated Balance Sheet at February 28, 2014. | ||||||||||||||||||||||||||||
Investments Measured at Fair Value | The following table represents the Company’s investments measured at fair value as of February 28, 2015 (in thousands): | ||||||||||||||||||||||||||||
Balance Sheet Classification | |||||||||||||||||||||||||||||
Amortized | Gross Unrealized | Aggregate | Cash | Investments | Investments | ||||||||||||||||||||||||
Equivalent | in debt | in debt | |||||||||||||||||||||||||||
Marketable | securities, | securities, | |||||||||||||||||||||||||||
Cost | Gains | Losses(1) | Fair Value | Securities | short-term | long-term | |||||||||||||||||||||||
Money markets | $ | 369,926 | $ | — | $ | — | $ | 369,926 | $ | 369,926 | $ | — | $ | — | |||||||||||||||
Interest-bearing deposits | 39 | — | — | 39 | — | 39 | — | ||||||||||||||||||||||
Commercial paper | 29,994 | — | — | 29,994 | 29,994 | — | — | ||||||||||||||||||||||
U.S. agency securities | 276,928 | 13 | (654 | ) | 276,287 | — | 5,002 | 271,285 | |||||||||||||||||||||
Corporate securities | 420,431 | 1,219 | (450 | ) | 421,200 | — | 146,469 | 274,731 | |||||||||||||||||||||
Foreign government securities | 63,687 | 59 | (2 | ) | 63,744 | — | 63,744 | — | |||||||||||||||||||||
Total | $ | 1,161,005 | $ | 1,291 | $ | (1,106 | ) | $ | 1,161,190 | $ | 399,920 | $ | 215,254 | $ | 546,016 | ||||||||||||||
-1 | As of February 28, 2015, there were $0.3 million of accumulated unrealized losses related to investments that have been in a continuous unrealized loss position for 12 months or longer. | ||||||||||||||||||||||||||||
The following table represents the Company’s investments measured at fair value as of February 28, 2014 (in thousands): | |||||||||||||||||||||||||||||
Balance Sheet Classification | |||||||||||||||||||||||||||||
Amortized | Gross Unrealized | Aggregate | Cash | Investments | Investments | ||||||||||||||||||||||||
Equivalent | in debt | in debt | |||||||||||||||||||||||||||
Marketable | securities, | securities, | |||||||||||||||||||||||||||
Cost | Gains | Losses(1) | Fair Value | Securities | short-term | long-term | |||||||||||||||||||||||
Money markets | $ | 178,280 | $ | — | $ | — | $ | 178,280 | $ | 178,280 | $ | — | $ | — | |||||||||||||||
Interest-bearing deposits | 86,937 | — | — | 86,937 | — | 86,937 | — | ||||||||||||||||||||||
Commercial paper | 37,643 | — | — | 37,643 | 25,299 | 12,344 | — | ||||||||||||||||||||||
U.S. agency securities | 279,657 | 12 | (620 | ) | 279,049 | — | 56,314 | 222,735 | |||||||||||||||||||||
Corporate securities | 381,446 | 1,279 | (209 | ) | 382,516 | — | 131,612 | 250,904 | |||||||||||||||||||||
Foreign government securities | 79,818 | 34 | (11 | ) | 79,841 | — | 48,180 | 31,661 | |||||||||||||||||||||
Total | $ | 1,043,781 | $ | 1,325 | $ | (840 | ) | $ | 1,044,266 | $ | 203,579 | $ | 335,387 | $ | 505,300 | ||||||||||||||
-1 | As of February 28, 2014, there were $0.2 million of accumulated unrealized losses related to investments that have been in a continuous unrealized loss position for 12 months or longer. | ||||||||||||||||||||||||||||
Summary of Stated Maturities of Investment in Debt Securities | The following table summarizes the stated maturities of the Company’s investment in available-for-sale securities at February 28, 2015 (in thousands): | ||||||||||||||||||||||||||||
Total | Less than | 1-3 Years | 3-5 Years | More than | |||||||||||||||||||||||||
1 Year | 5 Years | ||||||||||||||||||||||||||||
Maturity of current and long-term available-for-sale securities | $ | 791,225 | $ | 245,209 | $ | 396,325 | $ | 149,691 | $ | — |
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 12 Months Ended | ||||||||||||
Feb. 28, 2015 | |||||||||||||
Reconciliation of Numerators and Denominators of Earnings Per Share Calculation | The following table reconciles the numerators and denominators of the earnings per share calculation for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands, except per share amounts): | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Net income, basic and diluted | $ | 180,201 | $ | 178,292 | $ | 150,204 | |||||||
Weighted average common shares outstanding | 186,529 | 189,920 | 193,147 | ||||||||||
Incremental shares attributable to assumed vesting or exercise of outstanding equity award shares | 2,717 | 2,116 | 2,657 | ||||||||||
Diluted shares | 189,246 | 192,036 | 195,804 | ||||||||||
Net income per share - diluted | $ | 0.95 | $ | 0.93 | $ | 0.77 | |||||||
Shares Considered Anti-Dilutive for Calculating Diluted EPS | The following share awards are not included in the computation of diluted earnings per share because the aggregate value of proceeds considered received upon either exercise or vesting was greater than the average market price of the Company’s common stock during the related periods and the effect of including such share awards in the computation would be anti-dilutive (in thousands): | ||||||||||||
Year ended | Year ended | Year ended | |||||||||||
February 28, | February 28, | February 28, | |||||||||||
2015 | 2014 | 2013 | |||||||||||
Number of shares considered anti-dilutive for calculating diluted EPS | 121 | 360 | 77 | ||||||||||
Segment_Reporting_Tables
Segment Reporting (Tables) | 12 Months Ended | ||||||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||||||
Summary of Revenue, Income (Loss) from Operations, Total Assets and Total Cash, Cash Equivalents and Available-for-Sale Investment Securities by Geographic Segment | The following summarizes revenue from unaffiliated customers, income (loss) from operations, total cash, cash equivalents and available-for-sale investment securities and total assets by geographic segment at and for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | ||||||||||||||||||||
Americas | EMEA | Asia Pacific | Corporate(1) | Consolidated | |||||||||||||||||
Year ended February 28, 2015 | |||||||||||||||||||||
Revenue from unaffiliated customers | $ | 1,144,237 | $ | 410,299 | $ | 234,953 | $ | — | $ | 1,789,489 | |||||||||||
Income (loss) from operations | $ | 242,173 | $ | 89,364 | $ | 53,689 | $ | (135,232 | ) | $ | 249,994 | ||||||||||
Total cash, cash equivalents and available-for-sale investment securities | $ | 1,267,824 | $ | 405,114 | $ | 135,805 | $ | — | $ | 1,808,743 | |||||||||||
Total assets | $ | 2,773,754 | $ | 726,213 | $ | 303,018 | $ | — | $ | 3,802,985 | |||||||||||
Year ended February 28, 2014 | |||||||||||||||||||||
Revenue from unaffiliated customers | $ | 974,655 | $ | 352,935 | $ | 207,025 | $ | — | $ | 1,534,615 | |||||||||||
Income (loss) from operations | $ | 199,254 | $ | 94,949 | $ | 51,860 | $ | (113,774 | ) | $ | 232,289 | ||||||||||
Total cash, cash equivalents and available-for-sale investment securities | $ | 808,830 | $ | 517,397 | $ | 161,202 | $ | — | $ | 1,487,429 | |||||||||||
Total assets | $ | 2,153,828 | $ | 703,929 | $ | 248,862 | $ | — | $ | 3,106,619 | |||||||||||
Year ended February 28, 2013 | |||||||||||||||||||||
Revenue from unaffiliated customers | $ | 855,214 | $ | 284,922 | $ | 188,681 | $ | — | $ | 1,328,817 | |||||||||||
Income (loss) from operations | $ | 181,136 | $ | 72,440 | $ | 46,160 | $ | (98,698 | ) | $ | 201,038 | ||||||||||
Total cash, cash equivalents and available-for-sale investment securities | $ | 825,906 | $ | 370,174 | $ | 122,293 | $ | — | $ | 1,318,373 | |||||||||||
Total assets | $ | 2,068,879 | $ | 534,093 | $ | 210,688 | $ | — | $ | 2,813,660 | |||||||||||
-1 | Amounts represent share-based compensation expense for each of the three fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013, which was not allocated to geographic segments. | ||||||||||||||||||||
Summary of Revenue from Unaffiliated Customers | The following table lists, for the years ended February 28, 2015, February 28, 2014 and February 28, 2013, revenue from unaffiliated customers in the United States, the Company’s country of domicile, and revenue from foreign countries (in thousands): | ||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||
United States, the Company’s country of domicile | $ | 1,022,803 | $ | 848,053 | $ | 753,898 | |||||||||||||||
Foreign | 766,686 | 686,562 | 574,919 | ||||||||||||||||||
Total revenue from unaffiliated customers | $ | 1,789,489 | $ | 1,534,615 | $ | 1,328,817 | |||||||||||||||
Summary of Tangible Long-Lived Assets | Total tangible long-lived assets located in the United States, the Company’s country of domicile, and similar tangible long-lived assets held outside the U.S. are summarized in the following table for the years ended February 28, 2015, February 28, 2014 and February 28, 2013 (in thousands): | ||||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||
United States, the Company’s country of domicile | $ | 131,792 | $ | 137,356 | $ | 105,029 | |||||||||||||||
Foreign | 40,359 | 36,561 | 36,557 | ||||||||||||||||||
Total tangible long-lived assets | $ | 172,151 | $ | 173,917 | $ | 141,586 | |||||||||||||||
Summary of Subscription Revenue and Services by Technology Classes | The following table, for each of the fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013, provides further detail, by type, of our subscription and services revenues. Infrastructure-related offerings subscription revenue includes subscription revenue generated from Red Hat Enterprise Linux and related technologies such as Red Hat Enterprise Virtualization. Subscription revenue generated from our Application development-related and other emerging technology offerings includes Red Hat JBoss Middleware, Red Hat Storage Technologies and Red Hat cloud offerings such as Red Hat Enterprise Linux OpenStack Platform and OpenShift by Red Hat (in thousands): | ||||||||||||||||||||
Year ended | Year ended | Year ended | |||||||||||||||||||
February 28, | February 28, | February 28, | |||||||||||||||||||
2015 | 2014 | 2013 | |||||||||||||||||||
Subscription revenue: | |||||||||||||||||||||
Infrastructure-related offerings | $ | 1,324,693 | $ | 1,171,103 | $ | 1,027,983 | |||||||||||||||
Application development-related and other emerging technology offerings | 236,541 | 165,668 | 120,358 | ||||||||||||||||||
Total subscription revenue | 1,561,234 | 1,336,771 | 1,148,341 | ||||||||||||||||||
Training and services revenue: | |||||||||||||||||||||
Consulting services | 171,436 | 145,191 | 129,363 | ||||||||||||||||||
Training | 56,819 | 52,653 | 51,113 | ||||||||||||||||||
Total training and services revenue | 228,255 | 197,844 | 180,476 | ||||||||||||||||||
Total revenue | $ | 1,789,489 | $ | 1,534,615 | $ | 1,328,817 | |||||||||||||||
Other_LongTerm_Obligations_Tab
Other Long-Term Obligations (Tables) | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Other Long-Term Obligations | Other long-term obligations were comprised of the following (in thousands): | ||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Accrued income taxes | $ | 57,083 | $ | 45,645 | |||||
Deferred rent credits | 12,992 | 10,879 | |||||||
Net non-current deferred tax liability (See NOTE 11—Income Taxes) | 6,109 | 27,541 | |||||||
Other | 1,156 | 938 | |||||||
Other long-term obligations | $ | 77,340 | $ | 85,003 | |||||
Convertible_Notes_Tables
Convertible Notes (Tables) | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Components of Convertible Notes | As of February 28, 2015, the convertible notes consisted of the following (in thousands): | ||||||||
February 28, | |||||||||
2015 | |||||||||
Liability component | |||||||||
Principal | $ | 805,000 | |||||||
Less: debt discount | (89,598 | ) | |||||||
Net carrying amount | $ | 715,402 | |||||||
Equity component (1) | $ | 96,890 | |||||||
-1 | Recorded in the Consolidated Balance Sheet in Additional paid-in capital. | ||||||||
Schedule of Total Interest Expense Recognized Related to Convertible Notes | The following table includes total interest expense recognized related to the convertible notes for the fiscal year ended February 28, 2015 (in thousands): | ||||||||
Year ended | |||||||||
February 28, | |||||||||
2015 | |||||||||
Coupon rate 0.25% per year, payable semiannually | $ | 805 | |||||||
Amortization of convertible note issuance costs—liability component | 935 | ||||||||
Accretion of debt discount | 7,292 | ||||||||
Total interest expense related to convertible notes | $ | 9,032 | |||||||
Summary of Fair Value of Convertible Notes and Carrying Value of Convertible Notes | The fair value of the convertible notes, which was determined based on inputs that are observable in the market (Level 2), and the carrying value of convertible notes (the carrying value excludes the equity component of the convertible notes classified in equity) is as follows (in thousands): | ||||||||
February 28, 2015 | |||||||||
Fair Value | Carrying Value | ||||||||
Convertible notes | $ | 722,029 | $ | 715,402 | |||||
Accumulated_Other_Comprehensiv1
Accumulated Other Comprehensive Loss (Tables) | 12 Months Ended | ||||||||
Feb. 28, 2015 | |||||||||
Summary of Accumulated Other Comprehensive Loss | Accumulated other comprehensive loss was comprised of the following (in thousands): | ||||||||
February 28, | February 28, | ||||||||
2015 | 2014 | ||||||||
Accumulated loss from foreign currency translation adjustment | $ | (60,986 | ) | $ | (4,823 | ) | |||
Accumulated unrealized gain, net of tax, on available-for-sale securities | 365 | 364 | |||||||
Accumulated other comprehensive loss | $ | (60,621 | ) | $ | (4,459 | ) | |||
Unaudited_Quarterly_Results_Ta
Unaudited Quarterly Results (Tables) | 12 Months Ended | ||||||||||||||||
Feb. 28, 2015 | |||||||||||||||||
Schedule Of Unaudited Quarterly Results | Below are unaudited condensed quarterly results for the year ended February 28, 2015: | ||||||||||||||||
Year ended February 28, 2015 | |||||||||||||||||
(Unaudited) | |||||||||||||||||
4th | 3rd | 2nd | 1st | ||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||
(in thousands, except per share data) | |||||||||||||||||
Revenue: | |||||||||||||||||
Subscriptions | $ | 405,072 | $ | 394,699 | $ | 389,495 | $ | 371,968 | |||||||||
Training and services | 58,869 | 61,196 | 56,404 | 51,786 | |||||||||||||
Total subscription and training and services revenue | $ | 463,941 | $ | 455,895 | $ | 445,899 | $ | 423,754 | |||||||||
Gross profit | $ | 393,724 | $ | 384,530 | $ | 378,725 | $ | 359,311 | |||||||||
Income from operations | $ | 67,607 | $ | 67,197 | $ | 64,227 | $ | 50,963 | |||||||||
Interest income | $ | 2,288 | $ | 2,196 | $ | 2,010 | $ | 1,842 | |||||||||
Interest expense | $ | 5,803 | $ | 3,441 | $ | 97 | $ | 53 | |||||||||
Other income (expense), net | $ | 4,785 | $ | 1,559 | $ | (192 | ) | $ | 410 | ||||||||
Net income, basic and diluted | $ | 47,700 | $ | 47,933 | $ | 46,823 | $ | 37,745 | |||||||||
Net income per common share (1): | |||||||||||||||||
Basic | $ | 0.26 | $ | 0.26 | $ | 0.25 | $ | 0.2 | |||||||||
Diluted | $ | 0.26 | $ | 0.26 | $ | 0.25 | $ | 0.2 | |||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 183,459 | 185,039 | 188,162 | 189,372 | |||||||||||||
Diluted | 186,307 | 187,674 | 190,755 | 191,457 | |||||||||||||
-1 | Earnings per common share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly per common share information may not equal the reported annual earnings per common share. | ||||||||||||||||
Below are unaudited condensed quarterly results for the year ended February 28, 2014: | |||||||||||||||||
Year ended February 28, 2014 | |||||||||||||||||
(Unaudited) | |||||||||||||||||
4th | 3rd | 2nd | 1st | ||||||||||||||
Quarter | Quarter | Quarter | Quarter | ||||||||||||||
(in thousands, except per share data) | |||||||||||||||||
Revenue: | |||||||||||||||||
Subscriptions | $ | 351,492 | $ | 342,770 | $ | 326,692 | $ | 315,817 | |||||||||
Training and services | 48,905 | 53,766 | 47,731 | 47,442 | |||||||||||||
Total subscription and training and services revenue | $ | 400,397 | $ | 396,536 | $ | 374,423 | $ | 363,259 | |||||||||
Gross profit | $ | 339,861 | $ | 336,109 | $ | 318,843 | $ | 307,202 | |||||||||
Income from operations | $ | 59,300 | $ | 60,792 | $ | 55,574 | $ | 56,623 | |||||||||
Interest income | $ | 2,037 | $ | 1,579 | $ | 1,527 | $ | 1,502 | |||||||||
Interest expense | $ | 46 | $ | 51 | $ | 29 | $ | 34 | |||||||||
Other income (expense), net | $ | 328 | $ | (389 | ) | $ | 1,225 | $ | (390 | ) | |||||||
Net income, basic and diluted | $ | 45,068 | $ | 52,025 | $ | 40,808 | $ | 40,391 | |||||||||
Net income per common share (1): | |||||||||||||||||
Basic | $ | 0.24 | $ | 0.27 | $ | 0.22 | $ | 0.21 | |||||||||
Diluted | $ | 0.24 | $ | 0.27 | $ | 0.21 | $ | 0.21 | |||||||||
Weighted average shares outstanding: | |||||||||||||||||
Basic | 189,604 | 189,514 | 189,437 | 191,114 | |||||||||||||
Diluted | 191,712 | 191,365 | 191,432 | 192,969 | |||||||||||||
-1 | Earnings per common share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly per common share information may not equal the reported annual earnings per common share. |
Recovered_Sheet1
Summary Of Significant Accounting Policies - Additional Information (Detail) (USD $) | 12 Months Ended | |||
In Millions, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Oct. 07, 2014 |
Location | ||||
Significant Accounting Policies [Line Items] | ||||
Subscription period, minimum (years) | 1 year | |||
Subscription period, maximum (years) | 3 years | |||
Renewal period, minimum (years) | 1 year | |||
Renewal period, maximum (years) | 3 years | |||
Cash and cash equivalents maturity period (in months) | 3 months | |||
Estimated useful life of internal use computer software | 5 years | |||
Total advertising expense | $62.60 | $53.40 | $42.70 | |
Number of locations of offices | 85 | |||
0.25% Convertible Senior Notes due 2019 | ||||
Significant Accounting Policies [Line Items] | ||||
Debt instrument, interest rate | 0.25% | 0.25% | ||
Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Property Plant And Equipment Useful Life | 3 years | |||
Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Property Plant And Equipment Useful Life | 15 years | |||
North America | ||||
Significant Accounting Policies [Line Items] | ||||
Customer credit term | 30 days | |||
EMEA | ||||
Significant Accounting Policies [Line Items] | ||||
Standard credit term, minimum | 30 days | |||
Standard credit term, maximum | 45 days | |||
Asia Pacific | ||||
Significant Accounting Policies [Line Items] | ||||
Standard credit term, minimum | 30 days | |||
Standard credit term, maximum | 60 days | |||
Furniture and Fixtures | ||||
Significant Accounting Policies [Line Items] | ||||
Property Plant And Equipment Useful Life | 7 years | |||
Computer Equipment | Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Property Plant And Equipment Useful Life | 3 years | |||
Computer Equipment | Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Property Plant And Equipment Useful Life | 4 years | |||
Computer Software | ||||
Significant Accounting Policies [Line Items] | ||||
Property Plant And Equipment Useful Life | 5 years | |||
Leasehold Improvements | ||||
Significant Accounting Policies [Line Items] | ||||
Property Plant And Equipment Estimated Useful Lives | Over the lesser of the estimated remaining useful life of the asset or the remaining term of the lease |
Business_Combinations_Addition
Business Combinations - Additional Information (Detail) (USD $) | 12 Months Ended | 0 Months Ended | 12 Months Ended | |||||||
Feb. 28, 2015 | Oct. 08, 2014 | Jun. 24, 2014 | Apr. 30, 2014 | Dec. 21, 2012 | Feb. 28, 2013 | Feb. 28, 2014 | Feb. 29, 2012 | |||
Entity | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill acquired | 927,060,000 | $690,911,000 | $687,430,000 | $591,563,000 | ||||||
Restricted Stock | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Shares and Share units, Shares and Shares Underlying Awards | 529,057 | [1] | ||||||||
FeedHenry | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration paid | 80,200,000 | |||||||||
Goodwill acquired | 68,500,000 | |||||||||
Identifiable intangible assets acquired | 9,000,000 | |||||||||
Working capital | 2,700,000 | |||||||||
Transaction costs | 1,100,000 | |||||||||
eNovance, SAS | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration paid | 67,600,000 | |||||||||
Goodwill acquired | 60,800,000 | |||||||||
Identifiable intangible assets acquired | 5,300,000 | |||||||||
Working capital | 1,500,000 | |||||||||
Transaction costs | 900,000 | |||||||||
eNovance, SAS | Restricted Stock | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Shares and Share units, Shares and Shares Underlying Awards | 529,057 | |||||||||
Share-based awards, annual vesting percentage | 25.00% | |||||||||
Inktank Storage, Inc. | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration paid | 151,648,000 | |||||||||
Goodwill acquired | 131,446,000 | |||||||||
Identifiable intangible assets acquired | 10,770,000 | |||||||||
Transaction costs | 2,000,000 | |||||||||
Purchase consideration transferred | 152,543,000 | [2] | ||||||||
ManageIQ, Inc. | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Goodwill acquired | 79,900,000 | |||||||||
Identifiable intangible assets acquired | 17,300,000 | |||||||||
Working capital | 7,300,000 | |||||||||
Transaction costs | 500,000 | |||||||||
Purchase consideration transferred | 104,500,000 | |||||||||
Other Acquisitions | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Cash consideration paid | 31,200,000 | |||||||||
Goodwill acquired | 17,500,000 | |||||||||
Identifiable intangible assets acquired | 13,200,000 | |||||||||
Transaction costs | 1,000,000 | |||||||||
Number of acquired businesses | 2 | |||||||||
Current assets acquired | $500,000 | |||||||||
[1] | As part of the Company's acquisition of eNovance, a total of 529,057 restricted common shares were issued to certain shareholders of eNovance. These restricted shares are conditioned on continued employment with the Company. The shares effectively vest 25% per year and are being amortized on a straight-line basis to share-based compensation expense in the Company's Consolidated Statement of Operations. | |||||||||
[2] | In addition to the cash consideration transferred of $151.6 million and the assumed nonvested share-based awards with an acquisition-date fair value of $10.6 million, the Company committed to pay retention incentives totaling $8.4 million in cash (payable 25% annually from the date of acquisition assuming continued employment). The Company also awarded to key employees share-based awards with a combined grant value of $15.0 million which will vest 25% annually from the date of grant. |
Summary_of_Consideration_Trans
Summary of Consideration Transferred in Connection With Acquisition (Detail) (Inktank Storage, Inc., USD $) | 0 Months Ended | |||
In Thousands, unless otherwise specified | Apr. 30, 2014 | Apr. 30, 2014 | ||
Inktank Storage, Inc. | ||||
Business Acquisition [Line Items] | ||||
Cash consideration paid to and/or on behalf of holders of Inktank stock and vested options | $151,648 | |||
Fair value of nonvested employee share-based awards assumed and attributed to pre-combination services | 895 | [1] | 895 | [1] |
Total consideration transferred | $152,543 | [2] | ||
[1] | The total fair value, as of April 30, 2014, of all assumed nonvested share-based awards was $10.6 million, of which $0.9 million has been attributed to pre-acquisition employee services and accordingly has been recognized as consideration transferred. The remaining $9.7 million of fair value will be recognized as compensation expense over the remaining vesting period ranging from 1 month to approximately 4 years. | |||
[2] | In addition to the cash consideration transferred of $151.6 million and the assumed nonvested share-based awards with an acquisition-date fair value of $10.6 million, the Company committed to pay retention incentives totaling $8.4 million in cash (payable 25% annually from the date of acquisition assuming continued employment). The Company also awarded to key employees share-based awards with a combined grant value of $15.0 million which will vest 25% annually from the date of grant. |
Summary_of_Consideration_Trans1
Summary of Consideration Transferred in Connection With Acquisition (Parenthetical) (Detail) (Inktank Storage, Inc., USD $) | 0 Months Ended | |
Apr. 30, 2014 | Apr. 30, 2014 | |
Business Acquisition [Line Items] | ||
Pre-acquisition employee services nonvested share-based awards | $900,000 | |
Business combination compensation expense recognized of assumed nonvested share based awards | 9,700,000 | 9,700,000 |
Cash consideration paid | 151,648,000 | |
Business combination total nonvested share based awards assumed | 10,600,000 | 10,600,000 |
key employees | ||
Business Acquisition [Line Items] | ||
Retention incentives committed | 8,400,000 | 8,400,000 |
Retention incentives, annual vesting percentage | 25.00% | |
Share-based awards granted | $15,000,000 | |
Share-based awards, annual vesting percentage | 25.00% | |
Minimum | ||
Business Acquisition [Line Items] | ||
Business combination compensation expense, remaining vesting period | 1 month | |
Maximum | ||
Business Acquisition [Line Items] | ||
Business combination compensation expense, remaining vesting period | 4 years |
Tangible_and_Identifiable_Inta
Tangible and Identifiable Intangible Assets Acquired and Liabilities Assumed (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Feb. 29, 2012 | Apr. 30, 2014 |
In Thousands, unless otherwise specified | |||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||||
Goodwill | $927,060 | $687,430 | $690,911 | $591,563 | |
Inktank Storage, Inc. | |||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | |||||
Identifiable intangible assets (see detail below) | 10,770 | ||||
Cash | 27 | ||||
Accounts receivable | 746 | ||||
Deferred tax assets, net | 12,060 | ||||
Other assets | 161 | ||||
Accrued liabilities | -1,651 | ||||
Deferred revenue | -1,016 | ||||
Goodwill | 131,446 | ||||
Total consideration allocated | $152,543 |
Summary_of_Allocation_of_Consi
Summary of Allocation of Consideration Transferred to Identifiable Intangible Assets (Detail) (Inktank Storage, Inc., USD $) | 0 Months Ended | |
In Thousands, unless otherwise specified | Apr. 30, 2014 | Apr. 30, 2014 |
Finite Lived Intangible Assets Amortization Expense [Line Items] | ||
Total identifiable intangible assets | $10,770 | $10,770 |
Tradenames And Trademarks | General and Administrative | ||
Finite Lived Intangible Assets Amortization Expense [Line Items] | ||
Estimated Life | Indefinite | |
Total identifiable intangible assets | 3,300 | 3,300 |
Customer Relationships | Sales and Marketing | ||
Finite Lived Intangible Assets Amortization Expense [Line Items] | ||
Estimated Life | 5 years | |
Total identifiable intangible assets | 6,800 | 6,800 |
Covenants Not To Compete | Research and Development | ||
Finite Lived Intangible Assets Amortization Expense [Line Items] | ||
Estimated Life | 3 years | |
Total identifiable intangible assets | 370 | 370 |
Developed technology | Cost of Revenue | ||
Finite Lived Intangible Assets Amortization Expense [Line Items] | ||
Estimated Life | 5 years | |
Total identifiable intangible assets | $300 | $300 |
Post_Acquisition_Financial_Inf
Post Acquisition Financial Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Nov. 30, 2013 | Aug. 31, 2013 | 31-May-13 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Business Acquisition [Line Items] | |||||||||||
Revenue | $463,941 | $455,895 | $445,899 | $423,754 | $400,397 | $396,536 | $374,423 | $363,259 | $1,789,489 | $1,534,615 | $1,328,817 |
Operating expenses | -1,266,296 | -1,069,726 | -927,179 | ||||||||
Income from operations | 67,607 | 67,197 | 64,227 | 50,963 | 59,300 | 60,792 | 55,574 | 56,623 | 249,994 | 232,289 | 201,038 |
Other income | 4,785 | 1,559 | -192 | 410 | 328 | -389 | 1,225 | -390 | 6,562 | 774 | 736 |
Income before provision for income taxes | 255,498 | 239,548 | 209,752 | ||||||||
Tax benefit | -75,297 | -61,256 | -59,548 | ||||||||
Net loss | 47,700 | 47,933 | 46,823 | 37,745 | 45,068 | 52,025 | 40,808 | 40,391 | 180,201 | 178,292 | 150,204 |
Feed Henry Enovance and Inktank Storage Inc | |||||||||||
Business Acquisition [Line Items] | |||||||||||
Revenue | 7,771 | ||||||||||
Operating expenses | -28,898 | ||||||||||
Income from operations | -21,127 | ||||||||||
Other income | 849 | ||||||||||
Income before provision for income taxes | -20,278 | ||||||||||
Tax benefit | 5,982 | ||||||||||
Net loss | ($14,296) |
Pro_Forma_Consolidated_Financi
Pro Forma Consolidated Financial Information (Detail) (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Business Acquisition, Pro Forma Information [Line Items] | |||
Revenue | $1,794,948 | $1,551,301 | $1,339,595 |
Net income | $174,991 | $150,870 | $116,944 |
Basic net income per common share | $0.94 | $0.79 | $0.61 |
Diluted net income per common share | $0.92 | $0.79 | $0.60 |
Summary_of_Changes_in_Goodwill
Summary of Changes in Goodwill (Detail) (USD $) | 12 Months Ended | ||||||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Dec. 21, 2012 | Apr. 30, 2014 | Jun. 24, 2014 | Oct. 08, 2014 |
Goodwill [Line Items] | |||||||
Goodwill, beginning balance | $687,430 | $690,911 | $591,563 | ||||
Impact of foreign currency fluctuations and other adjustments | -1,188 | ||||||
Impact of foreign currency fluctuations | -21,156 | -317 | |||||
Goodwill, ending balance | 927,060 | 687,430 | 690,911 | ||||
ManageIQ, Inc. | |||||||
Goodwill [Line Items] | |||||||
Goodwill, beginning balance | 79,900 | ||||||
Acquisition | 83,074 | ||||||
Final purchase price allocation adjustment | -3,164 | ||||||
Goodwill, ending balance | 79,900 | ||||||
Other Acquisitions | |||||||
Goodwill [Line Items] | |||||||
Acquisition | 17,462 | ||||||
Goodwill, ending balance | 17,500 | ||||||
Inktank Storage, Inc. | |||||||
Goodwill [Line Items] | |||||||
Goodwill, beginning balance | 131,446 | ||||||
Acquisition | 131,446 | ||||||
Goodwill, ending balance | 131,446 | ||||||
eNovance, SAS | |||||||
Goodwill [Line Items] | |||||||
Goodwill, beginning balance | 60,800 | ||||||
Acquisition | 60,849 | ||||||
Goodwill, ending balance | 60,800 | ||||||
FeedHenry | |||||||
Goodwill [Line Items] | |||||||
Goodwill, beginning balance | 68,500 | ||||||
Acquisition | 68,491 | ||||||
Goodwill, ending balance | $68,500 |
Activities_In_Allowance_For_Do
Activities In Allowance For Doubtful Accounts (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||||
Balance at beginning of period | $1,986 | $1,339 | $1,877 | |||
Charged to (recovery of) expense | 469 | 841 | -102 | |||
Adjustments | -208 | [1] | -194 | [1] | -436 | [1] |
Balance at end of period | $2,247 | $1,986 | $1,339 | |||
[1] | Represents foreign currency translation adjustments and amounts written-off as uncollectible accounts receivable. |
Account_Receivables_Additional
Account Receivables - Additional Information (Detail) | Feb. 28, 2015 | Feb. 28, 2014 |
Customer | Customer | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of individual customers accounting for 10.0% of accounts receivable | 0 | 0 |
Schedule_Of_Property_And_Equip
Schedule Of Property And Equipment At Cost (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
In Thousands, unless otherwise specified | |||
Property, Plant and Equipment [Line Items] | |||
Computer equipment | $141,972 | $137,570 | |
Software, including software developed for internal use | 80,565 | 112,348 | |
Furniture and fixtures | 28,595 | 28,007 | |
Leasehold improvements | 100,882 | 96,410 | |
Property and equipment-in progress | 10,251 | 8,877 | |
Property and equipment | 362,265 | 383,212 | |
Less: accumulated depreciation | -190,114 | -209,295 | |
Property and equipment, net | $172,151 | $173,917 | $141,586 |
Property_And_Equipment_Additio
Property And Equipment - Additional Information (Detail) | 12 Months Ended |
Feb. 28, 2015 | |
Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives of property and equipment | 3 years |
Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives of property and equipment | 15 years |
Depreciation_Expense_Recognize
Depreciation Expense Recognized in Consolidated Financial Statements (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Property, Plant and Equipment [Line Items] | |||
Total depreciation expense | $48,001 | $45,169 | $38,818 |
Identifiable_Intangible_Assets2
Identifiable Intangible Assets - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 5 years | |
Carrying amount for intangible assets | $11.30 | $9.60 |
Trademarks, Copyrights and Patents | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 3 years | |
Trademarks, Copyrights and Patents | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 10 years | |
Purchased Technologies | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 3 years | |
Purchased Technologies | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 10 years | |
Customer and Reseller Relationships | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 3 years | |
Customer and Reseller Relationships | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 10 years | |
Covenants Not To Compete | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 3 years | |
Covenants Not To Compete | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Useful life (in years) | 10 years |
Summary_of_Identifiable_Intang
Summary of Identifiable Intangible Assets (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | $322,102 | $294,306 |
Accumulated Amortization | -187,826 | -160,907 |
Net Amount | 134,276 | 133,399 |
Trademarks, Copyrights and Patents | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 117,020 | 105,269 |
Accumulated Amortization | -42,630 | -34,784 |
Net Amount | 74,390 | 70,485 |
Purchased Technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 81,482 | 79,433 |
Accumulated Amortization | -63,618 | -55,960 |
Net Amount | 17,864 | 23,473 |
Customer and Reseller Relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 104,084 | 89,992 |
Accumulated Amortization | -71,512 | -63,075 |
Net Amount | 32,572 | 26,917 |
Covenants Not To Compete | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 10,683 | 10,690 |
Accumulated Amortization | -7,657 | -5,977 |
Net Amount | 3,026 | 4,713 |
Other Intangible Assets | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Amount | 8,833 | 8,922 |
Accumulated Amortization | -2,409 | -1,111 |
Net Amount | $6,424 | $7,811 |
Schedule_of_Amortization_Expen
Schedule of Amortization Expense Associated with Identifiable Intangible Assets (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization expense | $28,262 | $29,236 | $23,523 |
Cost of Revenue | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization expense | 12,049 | 11,212 | 5,943 |
Sales and Marketing | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization expense | 7,838 | 8,872 | 8,416 |
Research and Development | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization expense | 2,417 | 3,836 | 3,836 |
General and Administrative | |||
Finite-Lived Intangible Assets [Line Items] | |||
Total amortization expense | $5,958 | $5,316 | $5,328 |
Schedule_of_Amortization_Expen1
Schedule of Amortization Expense (Detail) (USD $) | Feb. 28, 2015 |
In Thousands, unless otherwise specified | |
Finite-Lived Intangible Liabilities [Line Items] | |
2016 | $27,885 |
2017 | 25,209 |
2018 | 21,477 |
2019 | 15,161 |
2020 | 11,072 |
Thereafter | 22,184 |
Total amortization expense | $122,988 |
Components_of_Other_Assets_Net
Components of Other Assets ,Net (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Other Assets [Line Items] | ||
Cost-basis investments | $28,154 | $21,801 |
Net non-current deferred tax asset (see NOTE 11-Income Taxes) | 18,049 | 7,655 |
Security deposits and other | 7,040 | 5,935 |
Other assets, net | $53,243 | $35,391 |
Other_Assets_Net_Additional_In
Other Assets, Net - Additional Information (Detail) (USD $) | 12 Months Ended |
In Millions, unless otherwise specified | Feb. 28, 2015 |
Other Assets [Line Items] | |
Loss on investments recognized | $4.60 |
Schedule_of_Prepaid_Expense_In
Schedule of Prepaid Expense, Including Sales Commission (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Line Items] | ||
Deferred commissions | $107,313 | $80,987 |
Professional services | 14,934 | 12,827 |
Taxes | 17,543 | 13,012 |
Insurance | 1,859 | 1,207 |
Other | 9,066 | 10,354 |
Prepaid expenses | $150,715 | $118,387 |
Summary_of_Accounts_Payable_an
Summary of Accounts Payable and Accrued Expenses (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Accounts Payable and Accrued Liabilities [Line Items] | ||
Accounts payable | $31,017 | $18,326 |
Accrued wages and other compensation related expenses | 126,378 | 100,474 |
Accrued other trade payables | 40,400 | 40,998 |
Accrued income and other taxes payable | 39,596 | 19,253 |
Accrued other | 342 | 417 |
Accounts payable and accrued expenses | $237,733 | $179,468 |
Summary_of_Effects_of_Derivati
Summary of Effects of Derivative Instruments (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 |
Derivative [Line Items] | ||
Total, Fair Value | ($664) | $119 |
Amount of Gain (Loss) Recognized in Income on Derivative | -1,962 | -1,550 |
Forward contracts | ||
Derivative [Line Items] | ||
Notional value of foreign currency foreign currency forward contracts not designated as hedges | 108,117 | 28,336 |
Other Current Assets | ||
Derivative [Line Items] | ||
Assets-foreign currency forward contracts not designated as hedges | 74 | 134 |
Notional value of foreign currency foreign currency forward contracts not designated as hedges | 5,281 | 24,790 |
Accounts Payable and Accrued Liabilities | ||
Derivative [Line Items] | ||
Liabilities-foreign currency forward contracts not designated as hedges | -738 | -15 |
Notional value of foreign currency foreign currency forward contracts not designated as hedges | 102,836 | 3,546 |
Other Income (Expense), Net | Other Current Assets | ||
Derivative [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivative | 664 | 1,147 |
Other Income (Expense), Net | Accounts Payable and Accrued Liabilities | ||
Derivative [Line Items] | ||
Amount of Gain (Loss) Recognized in Income on Derivative | ($2,626) | ($2,697) |
Schedule_of_US_and_Foreign_Com
Schedule of U.S and Foreign Components of Income Before Provision for Income Taxes (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Schedule of Income Before Income Tax [Line Items] | |||
U.S. | $167,388 | $135,371 | $130,560 |
Foreign | 88,110 | 104,177 | 79,192 |
Income before provision for income taxes | $255,498 | $239,548 | $209,752 |
Schedule_of_Components_of_Prov
Schedule of Components of Provision for Income Taxes (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Components Of Income Tax Expense Benefit [Line Items] | |||
Current, Foreign | $26,325 | $23,391 | $16,556 |
Current, Federal | 15,252 | 19,734 | 33,598 |
Current, State | 4,090 | 7,147 | 1,882 |
Current tax expense | 45,667 | 50,272 | 52,036 |
Deferred, Foreign | -8,188 | -1,100 | 2,899 |
Deferred, Federal | 36,197 | 14,468 | 9,687 |
Deferred, State | 1,621 | -2,384 | -5,074 |
Deferred tax expense | 29,630 | 10,984 | 7,512 |
Net provision for income taxes | $75,297 | $61,256 | $59,548 |
Schedule_of_Deferred_Tax_Asset
Schedule of Deferred Tax Assets and Liabilities (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Components Of Deferred Income Tax Assets And Liabilities [Line Items] | ||
Foreign net operating loss carryforwards | $6,704 | $4,016 |
Domestic net operating loss carryforwards | 17,956 | 8,650 |
Domestic credit carryforwards | 8,990 | 24,045 |
Share-based compensation | 36,996 | 32,478 |
Deferred revenue | 68,850 | 49,749 |
Foreign deferred royalty expenses | 9,958 | 8,396 |
Convertible notes | 18,683 | |
Other | 12,407 | 10,599 |
Total deferred tax assets | 180,544 | 137,933 |
Valuation allowance for deferred tax assets | -2,641 | -699 |
Total deferred tax assets, net of valuation allowance | 177,903 | 137,234 |
Goodwill | 7,835 | 5,163 |
Fixed and intangible assets | 37,321 | 28,283 |
Compensation accruals | 23,518 | 12,738 |
Other | 11,152 | 3,342 |
Total deferred tax liabilities | 79,826 | 49,526 |
Net deferred tax asset | $98,077 | $87,708 |
Gross_and_Net_Deferred_Tax_Ass
Gross and Net Deferred Tax Asset and Liability Positions (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Components Of Deferred Tax Assets And Liabilities [Line Items] | ||
Current | $118,450 | |
Non-current | 59,453 | |
Current | 32,313 | |
Non-current | 47,513 | |
Net deferred tax asset | 98,077 | 87,708 |
Net current deferred tax asset | 86,796 | 108,264 |
Net non-current deferred tax asset, recorded in Other assets, net | 18,049 | 7,655 |
Net current deferred tax liability, recorded in Other current obligations | -659 | |
Net non-current deferred tax liability, recorded in Other long-term obligations | -6,109 | -27,541 |
Net deferred tax asset | 98,077 | 87,708 |
Domestic | ||
Components Of Deferred Tax Assets And Liabilities [Line Items] | ||
Current | 94,120 | |
Non-current | 51,666 | |
Current | 24,270 | |
Non-current | 44,389 | |
Net deferred tax asset | 77,127 | |
Net current deferred tax asset | 69,850 | |
Net non-current deferred tax asset, recorded in Other assets, net | 7,277 | |
Net deferred tax asset | 77,127 | |
Foreign Tax | ||
Components Of Deferred Tax Assets And Liabilities [Line Items] | ||
Current | 24,330 | |
Non-current | 7,787 | |
Current | 8,043 | |
Non-current | 3,124 | |
Net deferred tax asset | 20,950 | |
Net current deferred tax asset | 16,946 | |
Net non-current deferred tax asset, recorded in Other assets, net | 10,772 | |
Net current deferred tax liability, recorded in Other current obligations | -659 | |
Net non-current deferred tax liability, recorded in Other long-term obligations | -6,109 | |
Net deferred tax asset | $20,950 |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 |
Income Taxes [Line Items] | ||
Increase in valuation allowance as a result of acquired foreign NOL carryfowards | $1.90 | |
Operating loss carryforwards beginning expiration date | 29-Feb-16 | |
Research tax credit carryforwards beginning expiration date | 29-Feb-16 | |
Cumulative undistributed earnings of non-U.S. subsidiaries | 420 | |
Unrecognized tax benefits that would affect the tax rate | 55.7 | 49.7 |
Accrued Interest and Penalties Related to Unrecognized Tax Benefit | 9.2 | 6 |
Domestic | ||
Income Taxes [Line Items] | ||
Net operating loss carryforward | 43.5 | |
Research tax credit carryforwards | 7.4 | |
U.S. State | ||
Income Taxes [Line Items] | ||
Net operating loss carryforward | 75.2 | |
Research tax credit carryforwards | 12 | |
U.S. State | Stock Based Compensation | ||
Income Taxes [Line Items] | ||
Net operating loss carryforward | 27.3 | |
Foreign Tax | ||
Income Taxes [Line Items] | ||
Net operating loss carryforward | $30.20 |
Reconciliation_of_Statutory_Fe
Reconciliation of Statutory Federal Income Tax Rates to Provision for Income Taxes (Detail) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |||
Schedule of Effective Tax Rate Reconciliation [Line Items] | ||||||
Effective rate | 29.50% | 25.60% | 28.40% | |||
Provision at federal statutory rate, 35% | $89,424 | $83,842 | $73,413 | |||
State tax, net of federal tax benefit | 4,042 | [1] | 3,169 | [1] | 907 | [1] |
Foreign rate differential | -11,124 | -10,817 | -7,034 | |||
Israel tax holiday | -2,859 | [2] | -1,901 | [2] | -1,806 | [2] |
Foreign dividend | 8,720 | 623 | 5,787 | |||
Nondeductible items | 3,339 | 2,157 | 2,141 | |||
Research tax credit | -5,329 | -3,070 | -5,348 | |||
Foreign tax credit | -11,755 | -11,878 | -7,852 | |||
Domestic production activities deduction | -4,433 | -4,973 | ||||
Other | 5,272 | 4,104 | -660 | |||
Net provision for income taxes | $75,297 | $61,256 | $59,548 | |||
[1] | During the year ended February 28, 2013, the Company amended its state income tax returns for prior years, which resulted in a reduction of state tax, net of federal tax benefit, of $3.4 million. | |||||
[2] | The Company qualifies for a tax holiday in Israel which began during the fiscal year ended February 28, 2011 and is scheduled to terminate as of the fiscal year ending February 29, 2020. The tax holiday provides for an exemption from income tax in the first two years, and for a reduced rate of taxation on income generated in Israel for the subsequent eight years. The financial impact of this holiday for the year ended February 28, 2015 was a $2.9 million reduction in the Company's provision for income taxes, which increased the Company's diluted earnings per share by approximately $0.02. |
Reconciliation_of_Statutory_Fe1
Reconciliation of Statutory Federal Income Tax Rates to Provision for Income Taxes (Parenthetical) (Detail) (USD $) | 12 Months Ended | ||
In Millions, except Per Share data, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Schedule of Effective Tax Rate Reconciliation [Line Items] | |||
Federal statutory rate | 35.00% | 35.00% | 35.00% |
North Carolina | |||
Schedule of Effective Tax Rate Reconciliation [Line Items] | |||
Reduction of state tax | 3.4 | ||
ISRAEL | |||
Schedule of Effective Tax Rate Reconciliation [Line Items] | |||
Tax holiday scheduled to terminate | 29-Feb-20 | ||
Tax holiday exemption period | 2 years | ||
Reduced rate of income tax period | 8 years | ||
Reduction in the provision for income taxes | 2.9 | ||
Increase in diluted earnings per share | 0.02 |
Schedule_of_Unrecognized_Tax_B
Schedule of Unrecognized Tax Benefits (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Reconciliation of Unrecognized Tax Benefits [Line Items] | |||
Beginning Balance | $57,054 | $48,313 | $43,762 |
Additions based on tax positions related to prior years | 514 | 100 | 2,122 |
Additions based on tax positions related to the current year | 3,374 | 9,005 | 2,576 |
Reductions related to changes in facts and circumstances | -229 | -147 | |
Reductions related to settlements with tax authorities | -364 | ||
Reductions related to lapse of the statute of limitations | -370 | ||
Ending Balance | $60,343 | $57,054 | $48,313 |
Summary_of_Tax_Years_Subject_t
Summary of Tax Years Subject to Examination (Detail) | 12 Months Ended | |
Feb. 28, 2015 | ||
Domestic | ||
Income Tax Examination [Line Items] | ||
Years Subject to Income Tax Examination | 1994 - Present | [1] |
North Carolina | ||
Income Tax Examination [Line Items] | ||
Years Subject to Income Tax Examination | 1999 - Present | |
Ireland | ||
Income Tax Examination [Line Items] | ||
Years Subject to Income Tax Examination | 2010 - Present | |
Japan | ||
Income Tax Examination [Line Items] | ||
Years Subject to Income Tax Examination | 2012 - Present | [2] |
California | ||
Income Tax Examination [Line Items] | ||
Years Subject to Income Tax Examination | 2001 - Present | |
Massachusetts | ||
Income Tax Examination [Line Items] | ||
Years Subject to Income Tax Examination | 2008 - Present | |
[1] | The U.S. Internal Revenue Service has completed its examination with respect to the Company's fiscal year ended February 28, 2010 and proposed certain adjustments. The Company believes that it has adequately provided for any reasonably foreseeable outcomes that may result from the proposed adjustments but, depending on the ultimate outcome, the Company could be required to pay additional income taxes. The Company does not believe that such outcome would have a material effect on its consolidated financial condition or consolidated results of operations. | |
[2] | The Company has been examined for income tax for years through February 28, 2011. A tax examination was concluded in fiscal 2012 with no significant adjustments resulting. However, the statute of limitations remains open for five years. |
Summary_of_Tax_Years_Subject_t1
Summary of Tax Years Subject to Examination (Parenthetical) (Detail) | 12 Months Ended |
Feb. 28, 2011 | |
Income Tax Examination [Line Items] | |
Statute of limitation remaining open years | 5 years |
Common_and_Preferred_Stock_Add
Common and Preferred Stock - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | 22 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Oct. 07, 2014 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Feb. 28, 2015 |
Vote | Vote | Vote | |||
Schedule of Common Stock as Converted [Line Items] | |||||
Common stock, shares authorized | 300,000,000 | 300,000,000 | 300,000,000 | ||
Common stock, per share par value | $0.00 | $0.00 | $0.00 | ||
Common stock votes per share | 1 | 1 | 1 | ||
Common stock, purchased during the period | 5,312,555 | 8,355,757 | 5,006,579 | 2,290,936 | 4,401,206 |
Aggregate cost of common stock repurchased | $535,062 | $239,363 | $120,662 | $220,000 | |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 | 5,000,000 | ||
Preferred stock, per share par value | $0.00 | $0.00 | $0.00 | ||
Preferred stock, shares outstanding | 0 | 0 | 0 |
Share_Based_Awards_Additional_
Share Based Awards - Additional Information (Detail) (USD $) | 12 Months Ended | ||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for issuance | 14,900,000 | ||
Share-based compensation expense capitalized | $0 | $0 | $0 |
Annual forfeitures rate | 10.00% | ||
Targeted percentage of performance share units earned by executive | 200.00% | ||
Nonvested Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage vested every three months following year one | 6.25% | ||
Percentage vested first anniversary | 25.00% | ||
Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Percentage vested during following four years | 25.00% | ||
Percentage vested first anniversary | 25.00% | ||
Stock Options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost related to unvested options | 7,600,000 | ||
Weighted average period over which awards are expected to be recognized (in years) | 2 years | ||
Performance Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost related to unvested options | 27,100,000 | ||
Weighted average period over which awards are expected to be recognized (in years) | 2 years 3 months 18 days | ||
Common stock performance period (in years) | 3 years | ||
Number of shares subject to PSU awards expected to vest | 1,300,000 | ||
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares and Share units, Shares and Shares Underlying Awards | 1,148,084 | 671,448 | 613,800 |
Percentage vested upon achievement of TSA Hurdle | 50.00% | ||
Percentage vested during following four years | 50.00% | ||
Performance Share Units | Executives | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares and Share units, Shares and Shares Underlying Awards | 242,352 | ||
Maximum | Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares and Share units, Shares and Shares Underlying Awards | 1,148,084 | 671,448 | 613,800 |
Minimum | Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Minimum percentage increase in common stock price and dividend payable for PSU pay out | 50.00% | ||
2004 Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Contract term (in years) | 5 years | ||
Percentage vested during following four years | 25.00% | ||
Percentage vested every three months following year one | 6.25% | ||
2004 Plan | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Contract term (in years) | 7 years | ||
Service Based Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation cost related to unvested options | $242,500,000 | ||
Weighted average period over which awards are expected to be recognized (in years) | 2 years 9 months 18 days | ||
Share Price Performance Period | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Targeted percentage of performance share units earned by executive | 200.00% | ||
First Performance Segment | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Targeted percentage of performance share units earned by executive | 50.00% | ||
Second Performance Segment | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Targeted percentage of performance share units earned by executive | 100.00% |
Summary_of_ShareBased_Awards_G
Summary of Share-Based Awards Granted During Period (Detail) (USD $) | 12 Months Ended | |||||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock options, Shares and Shares Underlying Awards | 133,800 | 114,361 | ||||
Stock options assumed, Shares and Shares Underlying Awards | 219,169 | |||||
Total share-based awards, Shares and Shares Underlying Awards | 4,890,863 | 3,318,576 | 3,200,033 | |||
Stock options, Weighted Average Per Share Award Fair Value | $48.45 | $12.64 | $15.16 | |||
Stock options assumed, Weighted Average Per Share Award Fair Value | $48.45 | |||||
Total share-based awards, Weighted Average Per Share Award Fair Value | $52.93 | $46.11 | $52.75 | |||
Stock Options | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Stock options, Shares and Shares Underlying Awards | 133,800 | 114,361 | ||||
Stock options, Weighted Average Per Share Award Fair Value | $12.64 | $15.16 | ||||
Service Based Share Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares and Share units, Shares and Shares Underlying Awards | 2,994,553 | [1] | 2,513,328 | [1] | 2,471,872 | [1] |
Shares and share units, Weighted Average Per Share Award Fair Value | $53.23 | [1] | $47.43 | [1] | $54.62 | [1] |
Performance Share Units | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares and Share units, Shares and Shares Underlying Awards | 1,148,084 | 671,448 | 613,800 | |||
Shares and share units, Weighted Average Per Share Award Fair Value | $52.17 | $47.86 | $52.23 | |||
Performance Share Units | Maximum | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares and Share units, Shares and Shares Underlying Awards | 1,148,084 | 671,448 | 613,800 | |||
Shares and share units, Weighted Average Per Share Award Fair Value | $52.17 | $47.86 | $52.23 | |||
Restricted Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares and Share units, Shares and Shares Underlying Awards | 529,057 | [2] | ||||
Shares and share units, Weighted Average Per Share Award Fair Value | $54.75 | |||||
Restricted Stock | eNovance, SAS | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares and Share units, Shares and Shares Underlying Awards | 529,057 | |||||
Shares and share units, Weighted Average Per Share Award Fair Value | $54.75 | |||||
[1] | Service-based shares granted during the year ended February 28, 2015 include 184,325 restricted shares awarded to certain executives that were subject to both a four-year service condition and the achievement of a specified dollar amount of revenue for fiscal year 2015 (the "RSA performance goal"). The RSA performance goal for fiscal year 2015 was met. Therefore, as of February 28, 2015 only the service condition remained, with 25% of such shares scheduled to vest vesting on July 16, 2015, one year from the date of grant, and the remainder vesting ratably on a quarterly basis over the course of the subsequent three-year period. | |||||
[2] | As part of the Company's acquisition of eNovance, a total of 529,057 restricted common shares were issued to certain shareholders of eNovance. These restricted shares are conditioned on continued employment with the Company. The shares effectively vest 25% per year and are being amortized on a straight-line basis to share-based compensation expense in the Company's Consolidated Statement of Operations. |
Summary_of_ShareBased_Awards_G1
Summary of Share-Based Awards Granted During Period (Parenthetical) (Detail) (Service Based Share Units) | 12 Months Ended | |||||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares and Share units, Shares and Shares Underlying Awards | 2,994,553 | [1] | 2,513,328 | [1] | 2,471,872 | [1] |
Percentage vested during following three years | 25.00% | |||||
Executives | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Shares and Share units, Shares and Shares Underlying Awards | 184,325 | |||||
[1] | Service-based shares granted during the year ended February 28, 2015 include 184,325 restricted shares awarded to certain executives that were subject to both a four-year service condition and the achievement of a specified dollar amount of revenue for fiscal year 2015 (the "RSA performance goal"). The RSA performance goal for fiscal year 2015 was met. Therefore, as of February 28, 2015 only the service condition remained, with 25% of such shares scheduled to vest vesting on July 16, 2015, one year from the date of grant, and the remainder vesting ratably on a quarterly basis over the course of the subsequent three-year period. |
ShareBased_Compensation_Expens
Share-Based Compensation Expense (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total share-based compensation expense | $135,232 | $113,774 | $98,698 |
Cost of Revenue | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total share-based compensation expense | 14,027 | 11,793 | 9,433 |
Sales and Marketing | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total share-based compensation expense | 55,203 | 40,322 | 32,906 |
Research and Development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total share-based compensation expense | 38,517 | 34,194 | 29,647 |
General and Administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total share-based compensation expense | $27,485 | $27,465 | $26,712 |
Total_Fair_Value_of_Stock_Opti
Total Fair Value of Stock Options Recognized (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
In Thousands, unless otherwise specified | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Total fair value of stock options recognized | $5,085 | $2,139 | $2,791 |
Summary_of_Stock_Option_Activi
Summary of Stock Option Activity (Detail) (USD $) | 12 Months Ended | |||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | ||
Shares Underlying Options | ||||
Shares Underlying Options Outstanding, beginning balance | 376,621 | 452,687 | 1,103,153 | |
Granted, Shares Underlying Options | 133,800 | 114,361 | ||
Exercised, Shares Underlying Options | -141,702 | -175,026 | -735,086 | |
Forfeited, Shares Underlying Options | -22,310 | -34,840 | -29,741 | |
Assumed, Shares Underlying Options | 219,169 | [1] | ||
Shares Underlying Options Outstanding, ending balance | 431,778 | 376,621 | 452,687 | |
Weighted Average Exercise Price Per Share | ||||
Weighted Average Exercise Price Per Share, beginning balance | $40.75 | $26.43 | $16.21 | |
Granted, Weighted Average Exercise Price Per Share | $47.12 | $55.17 | ||
Exercised, Weighted Average Exercise Price Per Share | $17.18 | $12.13 | $15.61 | |
Forfeited, Weighted Average Exercise Price Per Share | $28.69 | $22.93 | $25.10 | |
Assumed, Weighted Average Exercise Price Per Share | $0.20 | [1] | ||
Weighted Average Exercise Price Per Share, ending balance | $28.53 | $40.75 | $26.43 | |
[1] | Amount represents partially vested options assumed as part of a business combination. |
Summary_Of_Outstanding_And_Exe
Summary Of Outstanding And Exercisable Stock Options (Detail) (USD $) | 12 Months Ended |
Feb. 28, 2015 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Number Outstanding | 431,778 |
Options Outstanding Weighted Average Remaining Contractual Life | 4 years 9 months 18 days |
Options Outstanding Weighted Average Exercise Price | $28.53 |
Number Exercisable | 178,147 |
Options Exercisable Weighted Average Exercise Price | $33.50 |
Range One | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Prices | $0 |
Exercise Prices | $10 |
Number Outstanding | 182,624 |
Options Outstanding Weighted Average Remaining Contractual Life | 7 years 8 months 12 days |
Options Outstanding Weighted Average Exercise Price | $0.33 |
Number Exercisable | 56,976 |
Options Exercisable Weighted Average Exercise Price | $0.57 |
Range Two | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Prices | $10.01 |
Exercise Prices | $20 |
Number Outstanding | 3,130 |
Options Outstanding Weighted Average Remaining Contractual Life | 10 months 24 days |
Options Outstanding Weighted Average Exercise Price | $15.65 |
Number Exercisable | 3,130 |
Options Exercisable Weighted Average Exercise Price | $15.65 |
Range Three | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Prices | $20.01 |
Exercise Prices | $30 |
Options Outstanding Weighted Average Remaining Contractual Life | 0 years |
Range Four | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Prices | $30.01 |
Exercise Prices | $40 |
Number Outstanding | 11,667 |
Options Outstanding Weighted Average Remaining Contractual Life | 7 months 6 days |
Options Outstanding Weighted Average Exercise Price | $39.82 |
Number Exercisable | 11,667 |
Options Exercisable Weighted Average Exercise Price | $39.82 |
Range Five | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Prices | $40.01 |
Exercise Prices | $50 |
Number Outstanding | 99,106 |
Options Outstanding Weighted Average Remaining Contractual Life | 2 years 10 months 24 days |
Options Outstanding Weighted Average Exercise Price | $44.23 |
Number Exercisable | 40,288 |
Options Exercisable Weighted Average Exercise Price | $44.49 |
Range Six | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | |
Exercise Prices | $50.01 |
Number Outstanding | 135,251 |
Options Outstanding Weighted Average Remaining Contractual Life | 2 years 8 months 12 days |
Options Outstanding Weighted Average Exercise Price | $54.43 |
Number Exercisable | 66,086 |
Options Exercisable Weighted Average Exercise Price | $54.92 |
Intrinsic_Value_of_Stock_Optio
Intrinsic Value of Stock Options Exercised (Detail) (USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Feb. 29, 2012 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of Stock Options, Outstanding | 431,778 | 376,621 | 452,687 | 1,103,153 |
Number of Stock Options, Exercisable | 178,147 | |||
Number of Stock Options, Expected to vest | 227,474 | |||
Weighted Average Remaining Contractual Life, Outstanding (in years) | 4 years 9 months 18 days | |||
Weighted Average Remaining Contractual Life, Exercisable | 3 years 8 months 12 days | |||
Weighted Average Remaining Contractual Life, Expected to vest | 5 years 7 months 6 days | |||
Intrinsic Value, Outstanding | $17,526 | |||
Intrinsic Value, Exercisable | 6,346 | |||
Intrinsic Value, Expected to vest | 10,054 | |||
Total intrinsic value of stock options exercised | $6,289 | $6,775 | $29,598 |
Intrinsic_Value_of_Stock_Optio1
Intrinsic Value of Stock Options Exercised (Parenthetical) (Detail) | 12 Months Ended |
Feb. 28, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Number of Stock Options, Expected to vest annual forfeiture rate | 10.00% |
Summary_of_Fair_Value_of_Optio
Summary of Fair Value of Options Granted (Detail) (USD $) | 12 Months Ended | |||||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | ||||
Share based Compensation Arrangement Assumptions Used to Estimate Fair Values of Share Options Granted [Line Items] | ||||||
Expected dividend yield | 0.00% | 0.00% | 0.00% | |||
Risk-free interest rate | 0.98% | 0.62% | 0.41% | |||
Expected volatility | 36.39% | [1] | 36.80% | [1] | 38.13% | [1] |
Expected life (in years) | 3 years 3 months 7 days | [2] | 3 years 3 months 7 days | [2] | 3 years 3 months 7 days | [2] |
Weighted average fair value of options granted during the period | $48.45 | $12.64 | $15.16 | |||
[1] | The expected volatility rates for options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 were estimated based on an approximate equal weighting of the historical volatility of the Company's common stock over a period of approximately 3.27 years and the implied volatility of publicly traded options for the Company's common stock. | |||||
[2] | The expected term for options granted or assumed during the years ended February 28, 2015, February 28, 2014 and February 28, 2013 was determined based on the Company's historical exercise data. The Company reassesses its estimate of expected term annually or when new information indicates a change is appropriate. |
Summary_of_Fair_Value_of_Optio1
Summary of Fair Value of Options Granted (Parenthetical) (Detail) | 12 Months Ended | ||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |
Share based Compensation Arrangement Assumptions Used to Estimate Fair Values of Share Options Granted [Line Items] | |||
Expected life (in years) | 3 years 3 months 7 days | 3 years 3 months 7 days | 3 years 3 months 7 days |
Total_Fair_Value_Service_Perfo
Total Fair Value Service Performance Based Awards Recognized (Detail) (Service Based Share Units, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Service Based Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total fair value of service-based awards recognized | $107,887 | $92,450 | $76,460 |
Activity_for_ServiceBased_Shar
Activity for Service-Based Share Units (Detail) (USD $) | 12 Months Ended | |||||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | ||||
Service Based Share Units | ||||||
Nonvested Shares and Share Units | ||||||
Beginning balance | 5,373,308 | 5,193,433 | 5,486,639 | |||
Granted | 2,994,553 | [1] | 2,513,328 | [1] | 2,471,872 | [1] |
Vested | -1,948,247 | -1,915,326 | -2,184,588 | |||
Forfeited | -569,952 | -418,127 | -580,490 | |||
Ending Balance | 6,378,719 | 5,373,308 | 5,193,433 | |||
Weighted Average Grant-date Fair Value | ||||||
Weighted Average Grant-date Fair Value, beginning balance | $48.34 | $46.59 | $36.36 | |||
Granted, Weighted Average Grant-date Fair Value | $53.23 | [1] | $47.43 | [1] | $54.62 | [1] |
Vested, Weighted Average Grant-date Fair Value | $47.24 | $42.35 | $31.33 | |||
Forfeited, Weighted Average Grant-date Fair Value | $48.50 | $48.53 | $41.56 | |||
Weighted Average Grant-date Fair Value, ending balance | $51.49 | $48.34 | $46.59 | |||
Restricted Stock | ||||||
Nonvested Shares and Share Units | ||||||
Granted | 529,057 | [2] | ||||
Weighted Average Grant-date Fair Value | ||||||
Granted, Weighted Average Grant-date Fair Value | $54.75 | |||||
[1] | Service-based shares granted during the year ended February 28, 2015 include 184,325 restricted shares awarded to certain executives that were subject to both a four-year service condition and the achievement of a specified dollar amount of revenue for fiscal year 2015 (the "RSA performance goal"). The RSA performance goal for fiscal year 2015 was met. Therefore, as of February 28, 2015 only the service condition remained, with 25% of such shares scheduled to vest vesting on July 16, 2015, one year from the date of grant, and the remainder vesting ratably on a quarterly basis over the course of the subsequent three-year period. | |||||
[2] | As part of the Company's acquisition of eNovance, a total of 529,057 restricted common shares were issued to certain shareholders of eNovance. These restricted shares are conditioned on continued employment with the Company. The shares effectively vest 25% per year and are being amortized on a straight-line basis to share-based compensation expense in the Company's Consolidated Statement of Operations. |
Activity_for_ServiceBased_Shar1
Activity for Service-Based Share Units (Parenthetical) (Detail) (Restricted Stock) | 12 Months Ended | |
Feb. 28, 2015 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares and Share units, Shares and Shares Underlying Awards | 529,057 | [1] |
eNovance, SAS | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Shares and Share units, Shares and Shares Underlying Awards | 529,057 | |
Share-based awards, annual vesting percentage | 25.00% | |
[1] | As part of the Company's acquisition of eNovance, a total of 529,057 restricted common shares were issued to certain shareholders of eNovance. These restricted shares are conditioned on continued employment with the Company. The shares effectively vest 25% per year and are being amortized on a straight-line basis to share-based compensation expense in the Company's Consolidated Statement of Operations. |
Intrinsic_Value_Of_Service_Bas
Intrinsic Value Of Service - Based Awards (Detail) (Service Based Share Units, USD $) | 12 Months Ended | |||
In Thousands, except Share data, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Feb. 29, 2012 |
Service Based Share Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Number of Shares and Share Units, Outstanding | 6,378,719 | 5,373,308 | 5,193,433 | 5,486,639 |
Number of Shares and Share Units, Expected to vest | 5,464,591 | |||
Weighted Average Remaining Vesting Period, Outstanding (in years) | 2 years 9 months 18 days | |||
Weighted Average Remaining Vesting Period, Expected to vest (in years) | 2 years 9 months 18 days | |||
Intrinsic Value, Outstanding | $440,897 | |||
Intrinsic Value, Expected to vest | $377,713 |
Intrinsic_Value_Of_Service_Bas1
Intrinsic Value Of Service - Based Awards (Parenthetical) (Detail) | 12 Months Ended |
Feb. 28, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Annual forfeitures rate | 10.00% |
Service Based Share Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Annual forfeitures rate | 10.00% |
Total_Intrinsic_value_of_Servi
Total Intrinsic value of Service-Based Awards (Detail) (Service Based Share Units, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Service Based Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total intrinsic value of service-based awards vesting | $108,066 | $88,969 | $118,299 |
Activity_For_PerformanceBased_
Activity For Performance-Based Share Units (Detail) (Performance Share Units, USD $) | 12 Months Ended | ||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |
Performance Share Units | |||
Shares Underlying Performance Share Units | |||
Beginning balance | 1,675,225 | 1,504,670 | 1,725,607 |
Granted | 1,148,084 | 671,448 | 613,800 |
Vested | -374,921 | -399,334 | -634,384 |
Forfeited | -299,053 | -101,559 | -200,353 |
Ending Balance | 2,149,335 | 1,675,225 | 1,504,670 |
Weighted Average Grant-date Fair Value | |||
Weighted Average Grant-date Fair Value, beginning balance | $47.34 | $43.22 | $31.60 |
Granted, Weighted Average Grant-date Fair Value | $52.17 | $47.86 | $52.23 |
Vested, Weighted Average Grant-date Fair Value | $45.42 | $33.47 | $23.62 |
Forfeited, Weighted Average Grant-date Fair Value | $41.90 | $44.34 | $32.81 |
Weighted Average Grant-date Fair Value, ending balance | $51.01 | $47.34 | $43.22 |
Total_Fair_Value_Of_ServicePer
Total Fair Value Of Service/Performance-Based Awards Recognized (Detail) (Performance Share Units, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total fair value of performance-based awards recognized | $22,260 | $19,185 | $19,447 |
Total_Fair_Value_Of_Performanc
Total Fair Value Of Performance-Based Awards Vesting (Detail) (Performance Share Units, USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Performance Share Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total intrinsic value of performance-based awards vesting | $18,733 | $19,639 | $37,872 |
Schedule_Of_Future_Minimum_Lea
Schedule Of Future Minimum Lease Payments Required Under Operating Leases (Detail) (USD $) | Feb. 28, 2015 |
In Thousands, unless otherwise specified | |
Commitments and Contingencies [Line Items] | |
2016 | $31,330 |
2017 | 25,973 |
2018 | 20,679 |
2019 | 17,737 |
2020 | 15,862 |
Thereafter | 87,490 |
Total minimum lease payments | $199,071 |
Rent_Expense_Under_Operating_L
Rent Expense Under Operating Leases (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Commitments and Contingencies Disclosure [Line Items] | |||
Total operating lease expense | $30,869 | $29,472 | $26,830 |
Schedule_of_Defined_Benefit_Pl
Schedule of Defined Benefit Plans Disclosures (Detail) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Total contributions to employee benefit plans | $21,721 | $17,613 | $14,695 |
Share_Repurchase_Programs_Addi
Share Repurchase Programs - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | 22 Months Ended | 0 Months Ended | 3 Months Ended | ||||
Oct. 07, 2014 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Feb. 28, 2015 | Mar. 04, 2015 | Nov. 30, 2014 | Oct. 01, 2014 | Mar. 25, 2015 | |
Accelerated Share Repurchases [Line Items] | |||||||||
Common stock authorized for stock repurchase program | $300,000,000 | $300,000,000 | |||||||
Common stock, purchased during the period | 5,312,555 | 8,355,757 | 5,006,579 | 2,290,936 | 4,401,206 | ||||
Common stock repurchase | 535,062,000 | 239,363,000 | 120,662,000 | 220,000,000 | |||||
Repurchase of common stock, value | -375,000,000 | -375,000,000 | |||||||
Percentage of shares the company would have repurchased | 80.00% | ||||||||
Repurchase of common stock, average price per share | $56.47 | ||||||||
Subsequent Event | |||||||||
Accelerated Share Repurchases [Line Items] | |||||||||
Common stock authorized for stock repurchase program | 500,000,000 | ||||||||
Common stock, purchased during the period | 720,101 | ||||||||
Treasury Stock | |||||||||
Accelerated Share Repurchases [Line Items] | |||||||||
Common stock repurchase | 460,062,000 | 239,363,000 | 120,662,000 | 300,000,000 | |||||
Additional Paid-In Capital | |||||||||
Accelerated Share Repurchases [Line Items] | |||||||||
Common stock repurchase | $75,000,000 | $75,000,000 |
Fair_Value_of_Assets_and_Liabi
Fair Value of Assets and Liabilities Acquired (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 | ||
In Thousands, unless otherwise specified | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | $1,161,190 | $1,044,266 | ||
Total | 1,160,526 | 1,044,385 | ||
Foreign Exchange Contract | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Foreign currency derivatives, assets | 74 | [1] | 134 | [2] |
Foreign currency derivatives, liabilities | -738 | [3] | -15 | [4] |
Money Market Funds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 369,926 | [5] | 178,280 | [6] |
Interest-bearing Deposits | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 39 | [5] | 86,937 | [6] |
Commercial Paper | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 29,994 | [5] | 37,643 | [6] |
U.S. Agencies Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 276,287 | [5] | 279,049 | [6] |
Corporate Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 421,200 | [5] | 382,516 | [6] |
Foreign Government Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 63,744 | [5] | 79,841 | [6] |
Fair Value, Inputs, Level 1 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Total | 369,926 | 178,280 | ||
Fair Value, Inputs, Level 1 | Money Market Funds | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 369,926 | [5] | 178,280 | [6] |
Fair Value, Inputs, Level 2 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Total | 790,600 | 866,105 | ||
Fair Value, Inputs, Level 2 | Foreign Exchange Contract | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Foreign currency derivatives, assets | 74 | [1] | 134 | [2] |
Foreign currency derivatives, liabilities | -738 | [3] | -15 | [4] |
Fair Value, Inputs, Level 2 | Interest-bearing Deposits | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 39 | [5] | 86,937 | [6] |
Fair Value, Inputs, Level 2 | Commercial Paper | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 29,994 | [5] | 37,643 | [6] |
Fair Value, Inputs, Level 2 | U.S. Agencies Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 276,287 | [5] | 279,049 | [6] |
Fair Value, Inputs, Level 2 | Corporate Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | 421,200 | [5] | 382,516 | [6] |
Fair Value, Inputs, Level 2 | Foreign Government Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Available-for-sale securities | $63,744 | [5] | $79,841 | [6] |
[1] | Included in Other current assets in the Company's Consolidated Balance Sheet at February 28, 2015. | |||
[2] | Included in Other current assets in the Company's Consolidated Balance Sheet at February 28, 2014. | |||
[3] | Included in Accounts payable and accrued expenses in the Company's Consolidated Balance Sheet at February 28, 2015. | |||
[4] | Included in Accounts payable and accrued expenses in the Company's Consolidated Balance Sheet at February 28, 2014. | |||
[5] | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company's Consolidated Balance Sheet at February 28, 2015 in addition to $647.6 million of cash. | |||
[6] | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company's Consolidated Balance Sheet at February 28, 2014, in addition to $443.2 million of cash. |
Fair_Value_of_Assets_and_Liabi1
Fair Value of Assets and Liabilities Acquired (Parenthetical) (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Millions, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash | $647.60 | $443.20 |
Investments_Measured_at_Fair_V
Investments Measured at Fair Value (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 | ||
In Thousands, unless otherwise specified | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||||
Amortized Cost | $1,161,005 | $1,043,781 | ||
Gross Unrealized Gains | 1,291 | 1,325 | ||
Gross Unrealized Losses | -1,106 | [1] | -840 | [2] |
Aggregate Fair Value | 1,161,190 | 1,044,266 | ||
Cash and cash equivalents | 399,920 | 203,579 | ||
Investments in debt securities, short-term | 215,254 | 335,387 | ||
Investments in debt securities, long-term | 546,016 | 505,300 | ||
Money Market Funds | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||||
Amortized Cost | 369,926 | 178,280 | ||
Aggregate Fair Value | 369,926 | [3] | 178,280 | [4] |
Cash and cash equivalents | 369,926 | 178,280 | ||
Interest-bearing Deposits | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||||
Amortized Cost | 39 | 86,937 | ||
Aggregate Fair Value | 39 | [3] | 86,937 | [4] |
Investments in debt securities, short-term | 39 | 86,937 | ||
Commercial Paper | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||||
Amortized Cost | 29,994 | 37,643 | ||
Aggregate Fair Value | 29,994 | [3] | 37,643 | [4] |
Cash and cash equivalents | 29,994 | 25,299 | ||
Investments in debt securities, short-term | 12,344 | |||
U.S. Agencies Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||||
Amortized Cost | 276,928 | 279,657 | ||
Gross Unrealized Gains | 13 | 12 | ||
Gross Unrealized Losses | -654 | [1] | -620 | [2] |
Aggregate Fair Value | 276,287 | [3] | 279,049 | [4] |
Investments in debt securities, short-term | 5,002 | 56,314 | ||
Investments in debt securities, long-term | 271,285 | 222,735 | ||
Corporate Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||||
Amortized Cost | 420,431 | 381,446 | ||
Gross Unrealized Gains | 1,219 | 1,279 | ||
Gross Unrealized Losses | -450 | [1] | -209 | [2] |
Aggregate Fair Value | 421,200 | [3] | 382,516 | [4] |
Investments in debt securities, short-term | 146,469 | 131,612 | ||
Investments in debt securities, long-term | 274,731 | 250,904 | ||
Foreign Government Securities | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||||
Amortized Cost | 63,687 | 79,818 | ||
Gross Unrealized Gains | 59 | 34 | ||
Gross Unrealized Losses | -2 | [1] | -11 | [2] |
Aggregate Fair Value | 63,744 | [3] | 79,841 | [4] |
Investments in debt securities, short-term | 63,744 | 48,180 | ||
Investments in debt securities, long-term | $31,661 | |||
[1] | As of February 28, 2015, there were $0.3 million of accumulated unrealized losses related to investments that have been in a continuous unrealized loss position for 12 months or longer. | |||
[2] | As of February 28, 2014, there were $0.2 million of accumulated unrealized losses related to investments that have been in a continuous unrealized loss position for 12 months or longer. | |||
[3] | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company's Consolidated Balance Sheet at February 28, 2015 in addition to $647.6 million of cash. | |||
[4] | Included in Cash and cash equivalents, Investments in debt securities, short-term or Investments in debt securities, long-term in the Company's Consolidated Balance Sheet at February 28, 2014, in addition to $443.2 million of cash. |
Investments_Measured_at_Fair_V1
Investments Measured at Fair Value (Parenthetical) (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Millions, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring Basis [Line Items] | ||
Accumulated unrealized losses related to investments | $0.30 | $0.20 |
Summary_of_Stated_Maturities_o
Summary of Stated Maturities of Investment in Debt Securities (Detail) (USD $) | Feb. 28, 2015 |
In Thousands, unless otherwise specified | |
Schedule Of Marketable Securities [Line Items] | |
Total | $791,225 |
Less than 1 Year | 245,209 |
1-3 Years | 396,325 |
3-5 Years | 149,691 |
More than 5 Years | $0 |
Reconciliation_of_Numerators_a
Reconciliation of Numerators and Denominators of Earnings Per Share Calculation (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Feb. 28, 2015 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Nov. 30, 2013 | Aug. 31, 2013 | 31-May-13 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | ||||||||
Earnings Per Share [Line Items] | |||||||||||||||||||
Net income, basic and diluted | $47,700 | $47,933 | $46,823 | $37,745 | $45,068 | $52,025 | $40,808 | $40,391 | $180,201 | $178,292 | $150,204 | ||||||||
Weighted average common shares outstanding | 183,459 | 185,039 | 188,162 | 189,372 | 189,604 | 189,514 | 189,437 | 191,114 | 186,529 | 189,920 | 193,147 | ||||||||
Incremental shares attributable to assumed vesting or exercise of outstanding equity award shares | 2,717 | 2,116 | 2,657 | ||||||||||||||||
Diluted shares | 186,307 | 187,674 | 190,755 | 191,457 | 191,712 | 191,365 | 191,432 | 192,969 | 189,246 | 192,036 | 195,804 | ||||||||
Net income per share - diluted | $0.26 | [1] | $0.26 | [1] | $0.25 | [1] | $0.20 | [1] | $0.24 | [1] | $0.27 | [1] | $0.21 | [1] | $0.21 | [1] | $0.95 | $0.93 | $0.77 |
[1] | Earnings per common share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly per common share information may not equal the reported annual earnings per common share. |
Shares_Considered_AntiDilutive
Shares Considered Anti-Dilutive for Calculating Diluted EPS (Detail) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Number of shares considered anti-dilutive for calculating diluted EPS | 121 | 360 | 77 |
Summary_of_Revenue_Income_Loss
Summary of Revenue, Income (Loss) from Operations, Total Assets and Total Cash, Cash Equivalents and Available-for-Sale Investment Securities by Geographic Segments (Detail) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Nov. 30, 2013 | Aug. 31, 2013 | 31-May-13 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |||
Segment Reporting Information [Line Items] | ||||||||||||||
Revenue from unaffiliated customers | $463,941 | $455,895 | $445,899 | $423,754 | $400,397 | $396,536 | $374,423 | $363,259 | $1,789,489 | $1,534,615 | $1,328,817 | |||
Income (loss) from operations | 67,607 | 67,197 | 64,227 | 50,963 | 59,300 | 60,792 | 55,574 | 56,623 | 249,994 | 232,289 | 201,038 | |||
Total cash, cash equivalents and available-for-sale investment securities | 1,808,743 | 1,487,429 | 1,808,743 | 1,487,429 | 1,318,373 | |||||||||
Total assets | 3,802,985 | 3,106,619 | 3,802,985 | 3,106,619 | 2,813,660 | |||||||||
Corporate | ||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||
Income (loss) from operations | -135,232 | [1] | -113,774 | [1] | -98,698 | [1] | ||||||||
Americas | ||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||
Revenue from unaffiliated customers | 1,144,237 | 974,655 | 855,214 | |||||||||||
Income (loss) from operations | 242,173 | 199,254 | 181,136 | |||||||||||
Total cash, cash equivalents and available-for-sale investment securities | 1,267,824 | 808,830 | 1,267,824 | 808,830 | 825,906 | |||||||||
Total assets | 2,773,754 | 2,153,828 | 2,773,754 | 2,153,828 | 2,068,879 | |||||||||
EMEA | ||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||
Revenue from unaffiliated customers | 410,299 | 352,935 | 284,922 | |||||||||||
Income (loss) from operations | 89,364 | 94,949 | 72,440 | |||||||||||
Total cash, cash equivalents and available-for-sale investment securities | 405,114 | 517,397 | 405,114 | 517,397 | 370,174 | |||||||||
Total assets | 726,213 | 703,929 | 726,213 | 703,929 | 534,093 | |||||||||
Asia Pacific | ||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||
Revenue from unaffiliated customers | 234,953 | 207,025 | 188,681 | |||||||||||
Income (loss) from operations | 53,689 | 51,860 | 46,160 | |||||||||||
Total cash, cash equivalents and available-for-sale investment securities | 135,805 | 161,202 | 135,805 | 161,202 | 122,293 | |||||||||
Total assets | $303,018 | $248,862 | $303,018 | $248,862 | $210,688 | |||||||||
[1] | Amounts represent share-based compensation expense for each of the three fiscal years ended February 28, 2015, February 28, 2014 and February 28, 2013, which was not allocated to geographic segments. |
Summary_of_Revenue_from_Unaffi
Summary of Revenue from Unaffiliated Customers (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Nov. 30, 2013 | Aug. 31, 2013 | 31-May-13 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Segment Reporting Information [Line Items] | |||||||||||
Total revenue from unaffiliated customers | $463,941 | $455,895 | $445,899 | $423,754 | $400,397 | $396,536 | $374,423 | $363,259 | $1,789,489 | $1,534,615 | $1,328,817 |
United States | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue from unaffiliated customers | 1,022,803 | 848,053 | 753,898 | ||||||||
Foreign | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Total revenue from unaffiliated customers | $766,686 | $686,562 | $574,919 |
Segment_Reporting_Additional_I
Segment Reporting - Additional Information (Detail) | 12 Months Ended | ||
Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | |
Customer | Customer | Customer | |
Segment Reporting Information [Line Items] | |||
Number of individual customers from which the Company generated 10% or greater revenue | 0 | 0 | 0 |
Foreign | Minimum | |||
Segment Reporting Information [Line Items] | |||
Percentage of revenue from individual foreign country | 10.00% | 10.00% | 10.00% |
Summary_of_Tangible_LongLived_
Summary of Tangible Long-Lived Assets (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
In Thousands, unless otherwise specified | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total tangible long-lived assets | $172,151 | $173,917 | $141,586 |
United States | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total tangible long-lived assets | 131,792 | 137,356 | 105,029 |
Foreign | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total tangible long-lived assets | $40,359 | $36,561 | $36,557 |
Summary_of_Subscription_and_Se
Summary of Subscription and Services Revenue by Technology Classes (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Feb. 28, 2015 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Nov. 30, 2013 | Aug. 31, 2013 | 31-May-13 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 |
Revenue from External Customer [Line Items] | |||||||||||
Subscription revenue | $405,072 | $394,699 | $389,495 | $371,968 | $351,492 | $342,770 | $326,692 | $315,817 | $1,561,234 | $1,336,771 | $1,148,341 |
Training and services revenue | 58,869 | 61,196 | 56,404 | 51,786 | 48,905 | 53,766 | 47,731 | 47,442 | 228,255 | 197,844 | 180,476 |
Total revenue | 463,941 | 455,895 | 445,899 | 423,754 | 400,397 | 396,536 | 374,423 | 363,259 | 1,789,489 | 1,534,615 | 1,328,817 |
Infrastructure Related Subscriptions | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Subscription revenue | 1,324,693 | 1,171,103 | 1,027,983 | ||||||||
Application Development Related and Other Emerging Technology Subscriptions | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Subscription revenue | 236,541 | 165,668 | 120,358 | ||||||||
Consulting Services | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Training and services revenue | 171,436 | 145,191 | 129,363 | ||||||||
Training Services | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Training and services revenue | $56,819 | $52,653 | $51,113 |
Other_LongTerm_Obligation_Deta
Other Long-Term Obligation (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Other Long Term Liabilities [Line Items] | ||
Accrued income taxes | $57,083 | $45,645 |
Deferred rent credits | 12,992 | 10,879 |
Net non-current deferred tax liability (See NOTE 11-Income Taxes) | 6,109 | 27,541 |
Other | 1,156 | 938 |
Other long-term obligations | $77,340 | $85,003 |
Convertible_Notes_Additional_I
Convertible Notes - Additional Information (Detail) (USD $) | 0 Months Ended | 9 Months Ended | 12 Months Ended | |||
Oct. 07, 2014 | Oct. 01, 2014 | Nov. 30, 2014 | Feb. 28, 2015 | Oct. 07, 2014 | Oct. 01, 2014 | |
Debt Instrument [Line Items] | ||||||
Proceeds from issuance of convertible notes, net of issuance costs | 148,000,000 | |||||
Proceeds from issuance of warrants | 79,800,000 | 79,800,000 | 79,776,000 | |||
Repurchase of common stock, value | -375,000,000 | -375,000,000 | -375,000,000 | -375,000,000 | ||
Repurchase of note principal amount | 100.00% | |||||
Strike price of warrants | $101.65 | $101.65 | ||||
Premium on closing price of common stock | 80.00% | 80.00% | ||||
Number of shares of common stock underlying the warrants | 10,965,630 | 10,965,630 | ||||
0.25% Convertible Senior Notes due 2019 | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, aggregate principal amount | 805,000,000 | 805,000,000 | ||||
Debt instrument, interest rate | 0.25% | 0.25% | 0.25% | |||
Debt instrument, offering date | 1-Oct-14 | |||||
Frequency of interest payment | Semiannually | |||||
Transaction cost related to note issuance | 15,200,000 | |||||
0.25% Convertible Senior Notes due 2019 | Liability Component | ||||||
Debt Instrument [Line Items] | ||||||
Transaction cost related to note issuance | 13,400,000 | |||||
0.25% Convertible Senior Notes due 2019 | Equity Component | ||||||
Debt Instrument [Line Items] | ||||||
Transaction cost related to note issuance | 1,800,000 | |||||
Deferred tax liability, equity component | 700,000 | |||||
0.25% Convertible Senior Notes due 2019 | Unsecured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, interest rate | 0.25% | 0.25% | ||||
Debt instrument, maturity date | 1-Oct-19 | |||||
Frequency of interest payment | Semiannually in arrears on April 1 and October 1 of each year, beginning on April 1, 2015 | |||||
Common stock conversion rate per $1,000 principal amount of notes | 13.6219 | |||||
Principal amount per note | $1,000 | |||||
Debt instrument, convertible, conversion price, per share | $101.65 | $73.41 | $101.65 | |||
Premium on closing price of common stock | 30.00% | |||||
Closing price of common stock | $56.47 | $56.47 |
Components_of_Convertible_Note
Components of Convertible Notes (Detail) (USD $) | Feb. 28, 2015 | |
In Thousands, unless otherwise specified | ||
Debt Instrument [Line Items] | ||
Net carrying amount | $715,402 | |
0.25% Convertible Senior Notes due 2019 | ||
Debt Instrument [Line Items] | ||
Principal | 805,000 | |
Less: debt discount | -89,598 | |
Net carrying amount | 715,402 | |
Equity component | $96,890 | [1] |
[1] | Recorded in the Consolidated Balance Sheet in Additional paid-in capital. |
Schedule_of_Total_Interest_Exp
Schedule of Total Interest Expense Recognized Related to Convertible Notes (Detail) (0.25% Convertible Senior Notes due 2019, USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Feb. 28, 2015 |
0.25% Convertible Senior Notes due 2019 | |
Debt Instrument [Line Items] | |
Coupon rate 0.25% per year, payable semiannually | $805 |
Amortization of convertible note issuance costs-liability component | 935 |
Accretion of debt discount | 7,292 |
Total interest expense related to convertible notes | $9,032 |
Schedule_of_Total_Interest_Exp1
Schedule of Total Interest Expense Recognized Related to Convertible Notes (Parenthetical) (Detail) (0.25% Convertible Senior Notes due 2019) | 12 Months Ended | |
Feb. 28, 2015 | Oct. 07, 2014 | |
0.25% Convertible Senior Notes due 2019 | ||
Debt Instrument [Line Items] | ||
Coupon rate per year | 0.25% | 0.25% |
Frequency of coupon payment | Semiannually |
Fair_Value_of_Notes_Based_on_I
Fair Value of Notes Based on Inputs Observable in Market (Level 2) and Carrying Value of Debt Instruments (Detail) (USD $) | Feb. 28, 2015 |
In Thousands, unless otherwise specified | |
Debt Instrument [Line Items] | |
Carrying value, convertible notes | $715,402 |
Fair Value, Inputs, Level 2 | |
Debt Instrument [Line Items] | |
Fair value, convertible notes | $722,029 |
Summary_of_Accumulated_Other_C
Summary of Accumulated Other Comprehensive Loss (Detail) (USD $) | Feb. 28, 2015 | Feb. 28, 2014 |
In Thousands, unless otherwise specified | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||
Accumulated loss from foreign currency translation adjustment | ($60,986) | ($4,823) |
Accumulated unrealized gain, net of tax, on available-for-sale securities | 365 | 364 |
Accumulated other comprehensive loss | ($60,621) | ($4,459) |
Schedule_of_Unaudited_Quarterl
Schedule of Unaudited Quarterly Results (Detail) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Feb. 28, 2015 | Nov. 30, 2014 | Aug. 31, 2014 | 31-May-14 | Feb. 28, 2014 | Nov. 30, 2013 | Aug. 31, 2013 | 31-May-13 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | ||||||||
Quarterly Financial Information [Line Items] | |||||||||||||||||||
Subscriptions | $405,072 | $394,699 | $389,495 | $371,968 | $351,492 | $342,770 | $326,692 | $315,817 | $1,561,234 | $1,336,771 | $1,148,341 | ||||||||
Training and services | 58,869 | 61,196 | 56,404 | 51,786 | 48,905 | 53,766 | 47,731 | 47,442 | 228,255 | 197,844 | 180,476 | ||||||||
Total subscription and training and services revenue | 463,941 | 455,895 | 445,899 | 423,754 | 400,397 | 396,536 | 374,423 | 363,259 | 1,789,489 | 1,534,615 | 1,328,817 | ||||||||
Gross profit | 393,724 | 384,530 | 378,725 | 359,311 | 339,861 | 336,109 | 318,843 | 307,202 | 1,516,290 | 1,302,015 | 1,128,217 | ||||||||
Income from operations | 67,607 | 67,197 | 64,227 | 50,963 | 59,300 | 60,792 | 55,574 | 56,623 | 249,994 | 232,289 | 201,038 | ||||||||
Interest income | 2,288 | 2,196 | 2,010 | 1,842 | 2,037 | 1,579 | 1,527 | 1,502 | 8,336 | 6,645 | 8,245 | ||||||||
Interest expense | 5,803 | 3,441 | 97 | 53 | 46 | 51 | 29 | 34 | 9,394 | 160 | 267 | ||||||||
Other income (expense), net | 4,785 | 1,559 | -192 | 410 | 328 | -389 | 1,225 | -390 | 6,562 | 774 | 736 | ||||||||
Net income, basic and diluted | $47,700 | $47,933 | $46,823 | $37,745 | $45,068 | $52,025 | $40,808 | $40,391 | $180,201 | $178,292 | $150,204 | ||||||||
Basic | $0.26 | [1] | $0.26 | [1] | $0.25 | [1] | $0.20 | [1] | $0.24 | [1] | $0.27 | [1] | $0.22 | [1] | $0.21 | [1] | $0.97 | $0.94 | $0.78 |
Diluted | $0.26 | [1] | $0.26 | [1] | $0.25 | [1] | $0.20 | [1] | $0.24 | [1] | $0.27 | [1] | $0.21 | [1] | $0.21 | [1] | $0.95 | $0.93 | $0.77 |
Basic | 183,459 | 185,039 | 188,162 | 189,372 | 189,604 | 189,514 | 189,437 | 191,114 | 186,529 | 189,920 | 193,147 | ||||||||
Diluted | 186,307 | 187,674 | 190,755 | 191,457 | 191,712 | 191,365 | 191,432 | 192,969 | 189,246 | 192,036 | 195,804 | ||||||||
[1] | Earnings per common share are computed independently for each of the quarters presented. Therefore, the sum of the quarterly per common share information may not equal the reported annual earnings per common share. |
Subsequent_Events_Additional_I
Subsequent Events - Additional Information (Detail) (USD $) | 0 Months Ended | 12 Months Ended | 22 Months Ended | 0 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Oct. 07, 2014 | Feb. 28, 2015 | Feb. 28, 2014 | Feb. 28, 2013 | Feb. 28, 2015 | Mar. 04, 2015 | Mar. 25, 2015 |
Subsequent Event [Line Items] | |||||||
Repurchase of common stock, shares | 5,312,555 | 8,355,757 | 5,006,579 | 2,290,936 | 4,401,206 | ||
Common stock authorized for stock repurchase program | $300 | $300 | |||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Repurchase of common stock, shares | 720,101 | ||||||
Common stock authorized for stock repurchase program | $500 |