Red Hat 10-Q 7 Oct 15 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Aug. 31, 2015	Oct. 01, 2015
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Aug. 31, 2015
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2
Trading Symbol	RHT
Entity Registrant Name	RED HAT INC
Entity Central Index Key	1,087,423
Current Fiscal Year End Date	--02-29
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		182,803,302

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Aug. 31, 2015	Feb. 28, 2015	[1]
Current assets:
Cash and cash equivalents	$ 991,607	$ 1,047,473
Investments in debt securities, short-term	180,806	215,254
Accounts receivable, net of allowances for doubtful accounts of $2,268 and $2,247, respectively	302,098	468,021
Deferred tax assets, net	99,184	86,796
Prepaid expenses	130,413	150,715
Other current assets	1,853	1,980
Total current assets	1,705,961	1,970,239
Property and equipment, net of accumulated depreciation and amortization of $190,580 and $190,114, respectively	164,718	172,151
Goodwill	928,178	927,060
Identifiable intangibles, net	127,888	134,276
Investments in debt securities, long-term	823,417	546,016
Other assets, net	51,309	53,243
Total assets	3,801,471	3,802,985
Current liabilities:
Accounts payable and accrued expenses	212,828	237,733
Deferred revenue	1,047,732	1,095,115
Other current obligations	1,839	1,844
Total current liabilities	1,262,399	1,334,692
Long-term deferred revenue	365,708	387,213
Convertible notes	724,621	715,402
Other long-term obligations	$ 80,693	$ 77,340
Commitments and contingencies (NOTES 12 and 13)
Stockholders' equity:
Preferred stock, 5,000,000 shares authorized, none outstanding
Common stock, $0.0001 per share par value, 300,000,000 shares authorized, 233,930,696 and 233,061,964 shares issued, and 182,801,734 and 183,551,078 shares outstanding at August 31, 2015 and February 28, 2015, respectively	$ 23	$ 23
Additional paid-in capital	2,094,202	1,963,851
Retained earnings	999,854	900,373
Treasury stock at cost, 51,128,962 and 49,510,886 shares at August 31, 2015 and February 28, 2015, respectively	(1,660,580)	(1,515,288)
Accumulated other comprehensive loss	(65,449)	(60,621)
Total stockholders' equity	1,368,050	1,288,338
Total liabilities and stockholders' equity	$ 3,801,471	$ 3,802,985
[1]	Derived from audited financial statements.

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Aug. 31, 2015	Feb. 28, 2015	[1]
Accounts receivable, allowances for doubtful accounts	$ 2,268	$ 2,247
Property and equipment, accumulated depreciation and amortization	$ 190,580	$ 190,114
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, outstanding	0	0
Common stock, per share par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	300,000,000	300,000,000
Common stock, shares issued	233,930,696	233,061,964
Common stock, shares outstanding	182,801,734	183,551,078
Treasury stock, shares	51,128,962	49,510,886
[1]	Derived from audited financial statements.

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Revenue:
Subscriptions	$ 441,526	$ 389,495	$ 866,319	$ 761,462
Training and services	62,622	56,404	118,830	108,191
Total subscription and training and services revenue	504,148	445,899	985,149	869,653
Cost of subscription and training and services revenue:
Cost of subscriptions	30,996	27,791	60,843	55,551
Cost of training and services	44,968	39,383	86,519	76,066
Total cost of subscription and training and services revenue	75,964	67,174	147,362	131,617
Gross profit	428,184	378,725	837,787	738,036
Operating expense:
Sales and marketing	205,101	174,520	403,973	351,358
Research and development	102,488	95,265	199,919	185,204
General and administrative	44,125	44,713	86,496	86,284
Total operating expense	351,714	314,498	690,388	622,846
Income from operations	76,470	64,227	147,399	115,190
Interest income	2,895	2,010	5,611	3,852
Interest expense	5,733	97	11,448	150
Other income (expense), net	(1,245)	(192)	(1,448)	218
Income before provision for income taxes	72,387	65,948	140,114	119,110
Provision for income taxes	20,992	19,125	40,633	34,542
Net income	$ 51,395	$ 46,823	$ 99,481	$ 84,568
Basic net income per common share	$ 0.28	$ 0.25	$ 0.54	$ 0.45
Diluted net income per common share	$ 0.28	$ 0.25	$ 0.53	$ 0.44
Weighted average shares outstanding
Basic	183,179	188,162	183,155	188,767
Diluted	186,750	190,755	186,493	191,135

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Net income	$ 51,395	$ 46,823	$ 99,481	$ 84,568
Other comprehensive income (loss):
Change in foreign currency translation adjustment	2,623	(10,850)	(3,006)	(11,752)
Available-for-sale securities:
Unrealized gain (loss) on available-for-sale securities during the period	(2,138)	79	(2,544)	168
Reclassification for (gain) loss realized on available-for-sale securities, reported in Other income (expense), net	(2)	3	3	(150)
Tax benefit	672	101	719	168
Net change in available-for-sale securities (net of tax)	(1,468)	183	(1,822)	186
Total other comprehensive loss	1,155	(10,667)	(4,828)	(11,566)
Comprehensive income	$ 52,550	$ 36,156	$ 94,653	$ 73,002

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015		Aug. 31, 2014
Cash flows from operating activities:
Net income	$ 51,395	$ 46,823	$ 99,481		$ 84,568
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	18,538	19,539	37,085		38,463
Amortization of debt discount and transaction costs	5,222		10,417
Share-based compensation expense	40,537	36,605	77,059		65,319
Deferred income taxes	(3,843)	975	(1,929)		3,905
Net amortization of bond premium on debt securities available for sale	3,139	2,525	5,736		4,558
Other	1,078	595	1,908		(353)
Changes in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable	(17,908)	(18,349)	161,479		78,231
Prepaid expenses	13,077	(2,391)	12,651		(7,580)
Accounts payable and accrued expenses	34,415	27,266	(17,932)		29,921
Deferred revenue	(25,017)	(6,209)	(56,579)		(25,957)
Other	(356)	358	(340)		1,349
Net cash provided by operating activities	120,277	107,737	329,036		272,424
Cash flows from investing activities:
Purchase of investment in debt securities available for sale	(196,613)	(50,567)	(602,824)		(319,141)
Proceeds from sales and maturities of investment in debt securities available for sale	170,617	140,101	353,200		409,532
Acquisition of businesses, net of cash acquired	(1,700)	(66,183)	(1,700)		(217,804)
Purchase of other intangible assets	(2,068)	(1,198)	(5,997)		(1,751)
Purchase of property and equipment	(10,277)	(14,290)	(20,973)		(22,884)
Other	(1,159)	(1,038)	(3,158)		2,434
Net cash provided by (used in) investing activities	(41,200)	6,825	(281,452)		(149,614)
Cash flows from financing activities:
Excess tax benefits from share-based payment arrangements	2,812	423	9,231		1,409
Proceeds from exercise of common stock options	480	644	2,589		689
Payments related to net settlement of share-based compensation awards	(7,726)	(3,831)	(32,937)		(17,561)
Purchase of treasury stock	(70,079)	(80,028)	(70,079)		(160,061)
Payments on other borrowings	(385)	(1,635)	(737)		(1,990)
Net cash used in financing activities	(74,898)	(84,427)	(91,933)		(177,514)
Effect of foreign currency exchange rates on cash and cash equivalents	(3,494)	(8,902)	(11,517)		(6,657)
Net increase (decrease) in cash and cash equivalents	685	21,233	(55,866)		(61,361)
Cash and cash equivalents at beginning of the period	990,922	564,148	1,047,473	[1]	646,742
Cash and cash equivalents at end of the period	$ 991,607	$ 585,381	$ 991,607		$ 585,381
[1]	Derived from audited financial statements.

Company

Company	6 Months Ended
	Aug. 31, 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 to the Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2015.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Aug. 31, 2015
Summary of Significant Accounting Policies	NOTE 2—Summary of Significant Accounting Policies Basis of presentation The unaudited interim consolidated financial statements as of and for the three and six months ended August 31, 2015 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These consolidated statements are unaudited and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments and accruals) necessary for a fair statement of the consolidated balance sheets, consolidated operating results, consolidated other comprehensive income and consolidated cash flows for the periods presented in accordance with accounting principles generally accepted in the United States of America. Operating results for the three and six months ended August 31, 2015 are not necessarily indicative of the results that may be expected for the fiscal year ending February 29, 2016. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted in accordance with the SEC’s rules and regulations for interim reporting. These unaudited financial statements should be read in conjunction with the Company’s Consolidated Financial Statements, including notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2015. Other than the transition to estimating certain cloud-usage revenue described below, there have been no changes to the Company’s significant accounting policies from those described in NOTE 2—Summary of Significant Accounting Policies to the Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2015. These unaudited financial statements should be read in conjunction with the financial statements included in the Annual Report on Form 10-K. The Company derives a portion of its revenue from Certified Cloud and Service Providers (“CCSPs”) that provide public clouds and allow users to consume computing resources as a service. The Company earns revenue based on subscription units consumed by the CCSP or its end users. These cloud-usage services began expanding significantly in fiscal 2013 and have continued to grow. For periods prior to March 1, 2015, the Company recognized cloud-usage revenue upon receipt of usage reports from the CCSPs, which typically report fees owed to the Company one month or more after the fees have been earned. Effective March 1, 2015, the Company believes that it now has sufficient historical data and experience to estimate this cloud-usage revenue and has begun estimating the amount of and recognizing such revenue in the period earned. The estimates are based on the historical cloud-usage data available. As a result of the Company’s transition to estimating cloud-usage revenue, the Company’s subscription revenues and pre-tax income for the six months ended August 31, 2015 include an additional, favorable adjustment of $5.3 million. Consolidation policy 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 have been eliminated in consolidation. There are no significant foreign currency 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. 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 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 . In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers .

Changes in Equity

Changes in Equity	6 Months Ended
	Aug. 31, 2015
Changes in Equity	NOTE 3—Changes in Equity The following table summarizes the changes in the Company’s stockholders’ equity during the three months ended August 31, 2015 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at May 31, 2015 $ 23 $ 2,058,046 $ 948,459 $ (1,590,501 ) $ (66,604 ) $ 1,349,423 Net income — — 51,395 — — 51,395 Other comprehensive income (loss), net of tax — — — — 1,155 1,155 Exercise of common stock options — 480 — — — 480 Common stock repurchase (see NOTE 10) — — — (70,079 ) — (70,079 ) Share-based compensation expense — 40,537 — — — 40,537 Tax benefits related to share-based awards — 2,865 — — — 2,865 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (7,726 ) — — — (7,726 ) Balance at August 31, 2015 $ 23 $ 2,094,202 $ 999,854 $ (1,660,580 ) $ (65,449 ) $ 1,368,050 The following table summarizes the changes in the Company’s stockholders’ equity during the three months ended August 31, 2014 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at May 31, 2014 $ 23 $ 1,908,934 $ 757,917 $ (1,136,713 ) $ (5,358 ) $ 1,524,803 Net income — — 46,823 — — 46,823 Other comprehensive income (loss), net of tax — — — — (10,667 ) (10,667 ) Exercise of common stock options — 644 — — — 644 Common stock repurchase — — — (80,028 ) — (80,028 ) Share-based compensation expense — 36,605 — — — 36,605 Tax benefits related to share-based awards — 307 — — — 307 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (3,831 ) — — — (3,831 ) Balance at August 31, 2014 $ 23 $ 1,942,659 $ 804,740 $ (1,216,741 ) $ (16,025 ) $ 1,514,656 The following table summarizes the changes in the Company’s stockholders’ equity during the six months ended August 31, 2015 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at February 28 , 2015 $ 23 $ 1,963,851 $ 900,373 $ (1,515,288 ) $ (60,621 ) $ 1,288,338 Net income — — 99,481 — — 99,481 Other comprehensive income (loss), net of tax — — — — (4,828 ) (4,828 ) Exercise of common stock options — 2,589 — — — 2,589 Common stock repurchase (see NOTE 10) — 75,000 — (145,079 ) — (70,079 ) Share-based compensation expense — 77,059 — — — 77,059 Tax benefits related to share-based awards — 8,427 — — — 8,427 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (32,937 ) — — — (32,937 ) Other adjustments — 213 — (213 ) — — Balance at August 31, 2015 $ 23 $ 2,094,202 $ 999,854 $ (1,660,580 ) $ (65,449 ) $ 1,368,050 The following table summarizes the changes in the Company’s stockholders’ equity during the six months ended August 31, 2014 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at February 28, 2014 $ 23 $ 1,891,848 $ 720,172 $ (1,056,419 ) $ (4,459 ) $ 1,551,165 Net income — — 84,568 — — 84,568 Other comprehensive income (loss), net of tax — — — — (11,566 ) (11,566 ) Exercise of common stock options — 689 — — — 689 Common stock repurchase — — — (160,061 ) — (160,061 ) Share-based compensation expense — 65,319 — — — 65,319 Assumed employee share-based awards from a business acquisition — 895 — — — 895 Tax benefits related to share-based awards — 1,208 — — — 1,208 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (17,561 ) — — — (17,561 ) Other adjustments — 261 — (261 ) — — Balance at August 31, 2014 $ 23 $ 1,942,659 $ 804,740 $ (1,216,741 ) $ (16,025 ) $ 1,514,656 Accumulated other comprehensive loss The following is a summary of accumulated other comprehensive loss as of August 31, 2015 and February 28, 2015 (in thousands): As of As of Accumulated loss from foreign currency translation adjustment $ (63,992 ) $ (60,986 ) Accumulated unrealized gain, net of tax, on available-for-sale securities (1,457 ) 365 Accumulated other comprehensive loss $ (65,449 ) $ (60,621 )

Identifiable Intangible Assets

Identifiable Intangible Assets	6 Months Ended
	Aug. 31, 2015
Identifiable Intangible Assets	NOTE 4—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 related asset’s pattern of economic benefit or on a straight-line basis if a straight-line basis results in a greater amount of amortization for the period reported. Useful lives range from three to ten years. As of both August 31, 2015 and February 28, 2015, trademarks with an indefinite estimated useful life totaled $11.3 million. The following is a summary of identifiable intangible assets (in thousands): As of August 31, 2015 As of February 28, 2015 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Trademarks, copyrights and patents $ 122,268 $ (45,901 ) $ 76,367 $ 117,020 $ (42,630 ) $ 74,390 Purchased technologies 82,016 (66,920 ) 15,096 81,482 (63,618 ) 17,864 Customer and reseller relationships 104,121 (75,941 ) 28,180 104,084 (71,512 ) 32,572 Covenants not to compete 11,202 (8,693 ) 2,509 10,683 (7,657 ) 3,026 Other intangible assets 8,833 (3,097 ) 5,736 8,833 (2,409 ) 6,424 Total identifiable intangible assets $ 328,440 $ (200,552 ) $ 127,888 $ 322,102 $ (187,826 ) $ 134,276 Amortization expense associated with identifiable intangible assets recognized in the Company’s Consolidated Financial Statements for the three and six months ended August 31, 2015 and August 31, 2014 is summarized as follows (in thousands): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Cost of revenue $ 2,963 $ 2,830 $ 5,880 $ 5,790 Sales and marketing 2,009 1,992 4,014 3,574 Research and development 292 959 542 1,917 General and administrative 1,160 1,607 2,212 3,035 Total amortization expense $ 6,424 $ 7,388 $ 12,648 $ 14,316

Income Taxes

Income Taxes	6 Months Ended
	Aug. 31, 2015
Income Taxes	NOTE 5—Income Taxes Income Tax Expense The following table summarizes the Company’s tax provision for the three and six months ended August 31, 2015 and August 31, 2014 (in thousands): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Income before provision for income taxes $ 72,387 $ 65,948 $ 140,114 $ 119,110 Estimated annual effective tax rate 29 % 29 % 29 % 29 % Provision for income taxes $ 20,992 $ 19,125 $ 40,633 $ 34,542 For the three and six months ended August 31, 2015, the Company’s estimated annual effective tax rate of 29% differed from the U.S. federal statutory rate of 35% principally due to foreign income taxed at lower rates, state income taxes net of federal benefits and the domestic production activities deduction. For the three and six months ended August 31, 2014, the Company’s then-estimated annual effective tax rate of 29% differed from the U.S. federal statutory rate of 35%, principally due to foreign income taxed at lower rates.

Assets and Liabilities Measured

Assets and Liabilities Measured at Fair Value on a Recurring Basis	6 Months Ended
	Aug. 31, 2015
Assets and Liabilities Measured at Fair Value on a Recurring Basis	NOTE 6—Assets and Liabilities Measured at Fair Value on a Recurring Basis 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 (expense), net. Realized gains and losses and other than temporary impairments, if any, are reflected in the consolidated statements of operations as Other income (expense), 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. 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. The following table summarizes the composition and fair value hierarchy of the Company’s financial assets and liabilities at August 31, 2015 (in thousands): As of Quoted Prices In Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money markets (1) $ 236,105 $ 236,105 $ — $ — Available-for-sale securities (1): U.S. agency securities 315,154 — 315,154 — Corporate securities 680,337 — 680,337 — Foreign government securities 8,732 — 8,732 — Foreign currency derivatives (2) 263 — 263 — Liabilities: Foreign currency derivatives (3) (67 ) — (67 ) — Total $ 1,240,524 $ 236,105 $ 1,004,419 $ — (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 August 31, 2015, in addition to $755.5 million of cash. (2) Included in Other current assets in the Company’s Consolidated Balance Sheet at August 31, 2015. (3) Included in Accounts payable and accrued expenses in the Company’s Consolidated Balance Sheet at August 31, 2015. 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 February 28, 2015 Quoted Prices In Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) 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 represents the Company’s investments measured at fair value as of August 31, 2015 (in thousands): Balance Sheet Classification Amortized Cost Gross Unrealized Aggregate Fair Value Cash and Investments Investments Gains Losses (1) Money markets $ 236,105 $ — $ — $ 236,105 $ 236,105 $ — $ — U.S. agency securities 315,860 8 (714 ) 315,154 — 10,082 305,072 Corporate securities 680,238 415 (316 ) 680,337 — 161,992 518,345 Foreign government securities 8,721 11 — 8,732 — 8,732 — Total $ 1,240,924 $ 434 $ (1,030 ) $ 1,240,328 $ 236,105 $ 180,806 $ 823,417 (1) As of August 31, 2015, there were $0.5 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, 2015 (in thousands): Balance Sheet Classification Amortized Cost Gross Unrealized Aggregate Fair Value Cash and Investments Investments Gains Losses (1) 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.

Derivative Instruments

Derivative Instruments	6 Months Ended
	Aug. 31, 2015
Derivative Instruments	NOTE 7—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 does not designate these forward contracts as hedging instruments under applicable accounting guidance 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 August 31, 2015 and for the three and six months then ended (in thousands): As of August 31, 2015 Three Months 2015 Six Months Ended August 31, Balance Sheet Location Fair Value Notional Value Location of Gain (Loss) Recognized in Income on Derivatives Amount of Gain (Loss) Recognized in Income on Derivatives Assets—foreign currency forward contracts not designated as hedges Other current assets $ 263 $ 32,302 Other income (expense), net $ 592 $ 1,272 Liabilities—foreign currency forward contracts not designated as hedges Accounts payable and (67 ) 3,607 Other income (expense), net (437 ) (1,246 ) TOTAL $ 196 $ 35,909 $ 155 $ 26 The effects of derivative instruments on the Company’s Consolidated Financial Statements are as follows as of August 31, 2014 and for the three and six months then ended (in thousands): As of August 31, 2014 Three Months Six Months Ended August 31, Balance Sheet Location Fair Value Notional Value Location of Gain (Loss) Recognized in Income on Derivatives Amount of Gain (Loss) Recognized in Income on Derivatives Assets—foreign currency forward contracts not designated as hedges Other current assets $ 16 $ 4,441 Other income (expense), net $ 90 $ 264 Liabilities—foreign currency forward contracts not designated as hedges Accounts payable and (143 ) 17,764 Other income (expense), net (284 ) (541 ) TOTAL $ (127 ) $ 22,205 $ (194 ) $ (277 )

Share-based Awards

Share-based Awards	6 Months Ended
	Aug. 31, 2015
Share-based Awards	NOTE 8—Share-based Awards The Company measures share-based compensation cost at the 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 are measured at their underlying closing share price on the day of grant. The following summarizes share-based compensation expense recognized in the Company’s Consolidated Financial Statements for the three and six months ended August 31, 2015 and August 31, 2014 (in thousands): Three Months Ended Six Months Ended August 31, 2015 August 31, 2014 August 31, 2015 August 31, 2014 Cost of revenue $ 4,151 $ 3,425 $ 7,877 $ 6,543 Sales and marketing 16,782 13,691 32,194 23,929 Research and development 12,022 11,098 22,897 19,962 General and administrative 7,582 8,391 14,091 14,885 Total share-based compensation $ 40,537 $ 36,605 $ 77,059 $ 65,319 Share-based compensation expense qualifying for capitalization was insignificant for each of the three and six months ended August 31, 2015 and August 31, 2014. Accordingly, no share-based compensation expense was capitalized during the three and six months ended August 31, 2015 and August 31, 2014. Estimated annual forfeitures During the three and six months ended August 31, 2015, the Company granted the following share-based awards: Three Months Ended Six Months Ended August 31, 2015 August 31, 2015 Shares and Shares Underlying Awards Weighted Average Per Share Fair Value Shares and Shares Underlying Awards Weighted Average Per Share Fair Value Service-based shares and share units 118,881 $ 80.58 926,477 $ 75.55 Performance share units—target (1) 112,360 $ 80.59 370,478 $ 78.28 Performance share awards (2) 56,180 $ 80.59 154,705 $ 78.48 Total awards 287,421 $ 80.59 1,451,660 $ 76.56 (1) Certain executives and senior management were awarded a target number of performance share units (“PSUs”). PSU grantees may earn up to 200% of the target number of PSUs. Half of the target number of PSUs can be earned by the grantees depending upon the Company’s financial performance measured against the financial performance of specified peer companies during a three-year performance period beginning on March 1, 2015. The remaining target number of PSUs can be earned by the grantees depending upon the Company’s total shareholder return performance measured against the total shareholder return of specified peer companies during a three-year period beginning on March 1, 2015. (2) Certain executives were granted restricted stock awards. These shares were awarded subject to the achievement of a specified dollar amount of revenue for FY2016 (the “RSA Performance Goal”). If the Company fails to achieve the RSA Performance Goal for FY2016, then all such shares are forfeited. If the Company achieves the RSA Performance Goal for FY2016, then 25% of the restricted stock vests on July 16, 2016, and the remainder vests ratably on a quarterly basis over the course of the subsequent three–year period, provided that the grantee’s business relationship with the Company has not ceased.

Earnings Per Share

Earnings Per Share	6 Months Ended
	Aug. 31, 2015
Earnings Per Share	NOTE 9—Earnings Per 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. The following table reconciles the numerators and denominators of the earnings per share (“EPS”) calculation for the three and six months ended August 31, 2015 and August 31, 2014 (in thousands, except per share amounts): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Net income, basic and diluted $ 51,395 $ 46,823 $ 99,481 $ 84,568 Weighted average common shares outstanding 183,179 188,162 183,155 188,767 Incremental shares attributable to assumed vesting or exercise of outstanding equity award shares 2,986 2,593 3,009 2,368 Dilutive effect of convertible notes 585 — 329 — Diluted shares 186,750 190,755 186,493 191,135 Diluted net income per share $ 0.28 $ 0.25 $ 0.53 $ 0.44 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 15—Convertible Notes to the Company’s Consolidated Financial Statements for detailed information on the convertible notes. Warrants to purchase 10,965,630 shares of the Company’s common stock at $101.65 per share were outstanding during the three and six months ended August 31, 2015 but were not included in the computation of diluted EPS because the warrants’ exercise price was greater than the average market price of the Company’s common stock during the related period. The following employee share awards were 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): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Number of shares considered anti-dilutive for calculating diluted EPS 105 151 67 156

Share Repurchase Programs

Share Repurchase Programs	6 Months Ended
	Aug. 31, 2015
Share Repurchase Programs	NOTE 10—Share Repurchase Programs On March 25, 2015, the Company announced that its Board of Directors has 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 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. As of August 31, 2015, the Company had repurchased 894,915 shares of its common stock for $70.1 million under this repurchase program. As of August 31, 2015, the amount available under the program for the repurchase of the Company’s common stock was $429.9 million. Accelerated share repurchase During the fiscal year ended February 28, 2015, the Company entered into 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 percent of the shares deliverable to the Company under the ASR Agreement 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 initially 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 percent, 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 representing the unsettled portion of the ASR originally recorded in Additional paid-in capital was reclassified upon settlement to Treasury stock during the six months ended August 31, 2015. The total number of shares of common stock the Company repurchased under the ASR Agreement was 6,032,656 shares with a weighted average share price of $62.16.

Segment Reporting

Segment Reporting	6 Months Ended
	Aug. 31, 2015
Segment Reporting	NOTE 11—Segment Reporting The following summarizes revenue from unaffiliated customers and income (loss) from operations for the three and six months ended August 31, 2015 and August 31, 2014 and total cash, cash equivalents and available-for-sale investment securities and total assets as of August 31, 2015 and August 31, 2014, by geographic segment (in thousands): Americas EMEA Asia Pacific Corporate (1) Consolidated Three Months Ended August 31, 2015 Revenue from unaffiliated customers $ 332,204 $ 108,454 $ 63,490 $ — $ 504,148 Income (loss) from operations $ 73,944 $ 27,012 $ 16,051 $ (40,537 ) $ 76,470 Three Months Ended August 31, 2014 Revenue from unaffiliated customers $ 282,138 $ 103,496 $ 60,265 $ — $ 445,899 Income (loss) from operations $ 60,081 $ 26,066 $ 14,685 $ (36,605 ) $ 64,227 Six Months Ended August 31, 2015 Revenue from unaffiliated customers $ 654,037 $ 205,927 $ 125,185 $ — $ 985,149 Income (loss) from operations $ 149,475 $ 43,419 $ 31,564 $ (77,059 ) $ 147,399 Total cash, cash equivalents and available-for-sale investment securities $ 1,294,633 $ 490,607 $ 210,590 $ — $ 1,995,830 Total assets $ 2,735,505 $ 760,412 $ 305,554 $ — $ 3,801,471 Six Months Ended August 31, 2014 Revenue from unaffiliated customers $ 548,232 $ 204,270 $ 117,151 $ — $ 869,653 Income (loss) from operations $ 101,473 $ 50,251 $ 28,785 $ (65,319 ) $ 115,190 Total cash, cash equivalents and available-for-sale investment securities $ 621,806 $ 500,050 $ 195,087 $ — $ 1,316,943 Total assets $ 2,055,521 $ 720,493 $ 291,290 $ — $ 3,067,304 (1) Amounts represent share-based compensation expense for each of the three and six months ended August 31, 2015 and August 31, 2014, which was not allocated to geographic segments. Supplemental information about geographic areas The following table lists, for each of the three and six months ended August 31, 2015 and August 31, 2014, revenue from unaffiliated customers in the United States, the Company’s country of domicile, and revenue from unaffiliated customers from foreign countries (in thousands): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, United States, the Company’s country of domicile $ 300,649 $ 247,556 $ 588,110 $ 481,863 Foreign 203,499 198,343 397,039 387,790 Total revenue from unaffiliated customers $ 504,148 $ 445,899 $ 985,149 $ 869,653 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 United States are summarized in the following table as of August 31, 2015 and February 28, 2015 (in thousands): As of As of United States, the Company’s country of domicile $ 126,166 $ 131,792 Foreign 38,552 40,359 Total tangible long-lived assets $ 164,718 $ 172,151 Supplemental information about major customers For the each of the three and six months ended August 31, 2015 and August 31, 2014, the U.S. government and its agencies represented approximately 10% of the Company’s total revenue. Supplemental information about products and services The following table, for each of the three and six months ended August 31, 2015 and August 31, 2014, 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): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Subscription revenue: Infrastructure-related offerings $ 362,926 $ 331,967 $ 716,667 $ 651,018 Application development-related and other emerging technology offerings 78,600 57,528 149,652 110,444 Total subscription revenue 441,526 389,495 866,319 761,462 Training and services revenue: Consulting services 47,266 41,917 90,466 80,990 Training 15,356 14,487 28,364 27,200 Total training and services revenue 62,622 56,404 118,830 108,190 Total subscription and training and services revenue $ 504,148 $ 445,899 $ 985,149 $ 869,652

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Aug. 31, 2015
Commitments and Contingencies	NOTE 12—Commitments and Contingencies Operating leases As of August 31, 2015, the Company had leases of office space and certain equipment under various non-cancelable operating leases. Rent expense under operating leases for the three months ended August 31, 2015 and August 31, 2014 was $7.8 million and $7.5 million, respectively. Rent expense under operating leases for the six months ended August 31, 2015 and August 31, 2014 was $15.5 million and $15.0 million, respectively. 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. Historically, payments pursuant to these indemnifications have been immaterial.

Legal Proceedings

Legal Proceedings	6 Months Ended
	Aug. 31, 2015
Legal Proceedings	NOTE 13—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.

Business Combinations

Business Combinations	6 Months Ended
	Aug. 31, 2015
Business Combinations	NOTE 14—Business Combinations Acquisitions in Fiscal 2015 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. 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 transfer of these shares has been accounted for apart 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. 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. The consideration paid was $152.5 million and has been allocated to the Company’s assets and liabilities as follows: $131.4 million to goodwill, $10.8 million to identifiable intangible assets and the remaining $10.3 million to net working capital. Pro forma consolidated financial information The following unaudited pro forma consolidated financial information reflects the results of operations of the Company for the three and six months ended August 31, 2014 (in thousands, except per share amounts) as if the acquisitions of FeedHenry, eNovance and Inktank had closed on March 1, 2014, 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. Three Months Ended Six Months Ended August 31, 2014 August 31, 2014 Revenue $ 447,581 $ 874,727 Net income 44,253 74,945 Basic net income per common share $ 0.24 $ 0.40 Diluted net income per common share $ 0.23 $ 0.39 Goodwill The following is a summary of changes in goodwill for the six months ended August 31, 2015 (in thousands): Balance at February 28, 2015 $ 927,060 Impact of foreign currency fluctuations and other adjustments 1,118 Balance at August 31, 2015 $ 928,178 The excess of purchase price paid for FeedHenry, eNovance, Inktank 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 solutions.

Convertible Notes

Convertible Notes	6 Months Ended
	Aug. 31, 2015
Convertible Notes	NOTE 15—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 Morgan Stanley & Co. LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC as representatives of the several initial purchasers named therein (collectively, the “Initial Purchasers”), for resale to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended. 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 10—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, and began 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 August 31, 2015, the convertible notes consisted of the following (in thousands): As of Liability component Principal $ 805,000 Less: debt discount (80,379 ) Net carrying amount $ 724,621 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 August 31, 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 three and six months ended August 31, 2015 (in thousands): Three Months Ended Six Months Ended August 31, 2015 August 31, 2015 Coupon rate 0.25% per year, payable semiannually $ 503 $ 1,006 Amortization of convertible note issuance costs - liability component 602 1,198 Accretion of debt discount 4,620 9,219 Total interest expense related to convertible notes $ 5,725 $ 11,423 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 the convertible notes (the carrying value excludes the equity component of the convertible notes classified in equity) is as follows (in thousands): As of August 31, 2015 Fair Value Carrying Value Convertible notes $ 744,570 $ 724,621 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 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.

Summary of Significant Accoun22

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Aug. 31, 2015
Basis of presentation	Basis of presentation The unaudited interim consolidated financial statements as of and for the three and six months ended August 31, 2015 have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial reporting. These consolidated statements are unaudited and, in the opinion of management, include all adjustments (consisting of normal recurring adjustments and accruals) necessary for a fair statement of the consolidated balance sheets, consolidated operating results, consolidated other comprehensive income and consolidated cash flows for the periods presented in accordance with accounting principles generally accepted in the United States of America. Operating results for the three and six months ended August 31, 2015 are not necessarily indicative of the results that may be expected for the fiscal year ending February 29, 2016. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been omitted in accordance with the SEC’s rules and regulations for interim reporting. These unaudited financial statements should be read in conjunction with the Company’s Consolidated Financial Statements, including notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2015. Other than the transition to estimating certain cloud-usage revenue described below, there have been no changes to the Company’s significant accounting policies from those described in NOTE 2—Summary of Significant Accounting Policies to the Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended February 28, 2015. These unaudited financial statements should be read in conjunction with the financial statements included in the Annual Report on Form 10-K. The Company derives a portion of its revenue from Certified Cloud and Service Providers (“CCSPs”) that provide public clouds and allow users to consume computing resources as a service. The Company earns revenue based on subscription units consumed by the CCSP or its end users. These cloud-usage services began expanding significantly in fiscal 2013 and have continued to grow. For periods prior to March 1, 2015, the Company recognized cloud-usage revenue upon receipt of usage reports from the CCSPs, which typically report fees owed to the Company one month or more after the fees have been earned. Effective March 1, 2015, the Company believes that it now has sufficient historical data and experience to estimate this cloud-usage revenue and has begun estimating the amount of and recognizing such revenue in the period earned. The estimates are based on the historical cloud-usage data available. As a result of the Company’s transition to estimating cloud-usage revenue, the Company’s subscription revenues and pre-tax income for the six months ended August 31, 2015 include an additional, favorable adjustment of $5.3 million.
Consolidation policy	Consolidation policy 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 have been eliminated in consolidation. There are no significant foreign currency 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.
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 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 . In May 2014, the FASB issued Accounting Standards Update 2014-09, Revenue from Contracts with Customers .

Changes in Equity (Tables)

Changes in Equity (Tables)	6 Months Ended
	Aug. 31, 2015
Summary of Changes in Stockholders' Equity	The following table summarizes the changes in the Company’s stockholders’ equity during the three months ended August 31, 2015 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at May 31, 2015 $ 23 $ 2,058,046 $ 948,459 $ (1,590,501 ) $ (66,604 ) $ 1,349,423 Net income — — 51,395 — — 51,395 Other comprehensive income (loss), net of tax — — — — 1,155 1,155 Exercise of common stock options — 480 — — — 480 Common stock repurchase (see NOTE 10) — — — (70,079 ) — (70,079 ) Share-based compensation expense — 40,537 — — — 40,537 Tax benefits related to share-based awards — 2,865 — — — 2,865 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (7,726 ) — — — (7,726 ) Balance at August 31, 2015 $ 23 $ 2,094,202 $ 999,854 $ (1,660,580 ) $ (65,449 ) $ 1,368,050 The following table summarizes the changes in the Company’s stockholders’ equity during the three months ended August 31, 2014 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at May 31, 2014 $ 23 $ 1,908,934 $ 757,917 $ (1,136,713 ) $ (5,358 ) $ 1,524,803 Net income — — 46,823 — — 46,823 Other comprehensive income (loss), net of tax — — — — (10,667 ) (10,667 ) Exercise of common stock options — 644 — — — 644 Common stock repurchase — — — (80,028 ) — (80,028 ) Share-based compensation expense — 36,605 — — — 36,605 Tax benefits related to share-based awards — 307 — — — 307 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (3,831 ) — — — (3,831 ) Balance at August 31, 2014 $ 23 $ 1,942,659 $ 804,740 $ (1,216,741 ) $ (16,025 ) $ 1,514,656 The following table summarizes the changes in the Company’s stockholders’ equity during the six months ended August 31, 2015 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at February 28 , 2015 $ 23 $ 1,963,851 $ 900,373 $ (1,515,288 ) $ (60,621 ) $ 1,288,338 Net income — — 99,481 — — 99,481 Other comprehensive income (loss), net of tax — — — — (4,828 ) (4,828 ) Exercise of common stock options — 2,589 — — — 2,589 Common stock repurchase (see NOTE 10) — 75,000 — (145,079 ) — (70,079 ) Share-based compensation expense — 77,059 — — — 77,059 Tax benefits related to share-based awards — 8,427 — — — 8,427 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (32,937 ) — — — (32,937 ) Other adjustments — 213 — (213 ) — — Balance at August 31, 2015 $ 23 $ 2,094,202 $ 999,854 $ (1,660,580 ) $ (65,449 ) $ 1,368,050 The following table summarizes the changes in the Company’s stockholders’ equity during the six months ended August 31, 2014 (in thousands): Common Stock Additional Paid-In Capital Retained Earnings Treasury Stock Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Balance at February 28, 2014 $ 23 $ 1,891,848 $ 720,172 $ (1,056,419 ) $ (4,459 ) $ 1,551,165 Net income — — 84,568 — — 84,568 Other comprehensive income (loss), net of tax — — — — (11,566 ) (11,566 ) Exercise of common stock options — 689 — — — 689 Common stock repurchase — — — (160,061 ) — (160,061 ) Share-based compensation expense — 65,319 — — — 65,319 Assumed employee share-based awards from a business acquisition — 895 — — — 895 Tax benefits related to share-based awards — 1,208 — — — 1,208 Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards — (17,561 ) — — — (17,561 ) Other adjustments — 261 — (261 ) — — Balance at August 31, 2014 $ 23 $ 1,942,659 $ 804,740 $ (1,216,741 ) $ (16,025 ) $ 1,514,656
Summary of Accumulated Other Comprehensive Loss	The following is a summary of accumulated other comprehensive loss as of August 31, 2015 and February 28, 2015 (in thousands): As of As of Accumulated loss from foreign currency translation adjustment $ (63,992 ) $ (60,986 ) Accumulated unrealized gain, net of tax, on available-for-sale securities (1,457 ) 365 Accumulated other comprehensive loss $ (65,449 ) $ (60,621 )

Identifiable Intangible Assets

Identifiable Intangible Assets (Tables)	6 Months Ended
	Aug. 31, 2015
Summary of Identifiable Intangible Assets	The following is a summary of identifiable intangible assets (in thousands): As of August 31, 2015 As of February 28, 2015 Gross Amount Accumulated Amortization Net Amount Gross Amount Accumulated Amortization Net Amount Trademarks, copyrights and patents $ 122,268 $ (45,901 ) $ 76,367 $ 117,020 $ (42,630 ) $ 74,390 Purchased technologies 82,016 (66,920 ) 15,096 81,482 (63,618 ) 17,864 Customer and reseller relationships 104,121 (75,941 ) 28,180 104,084 (71,512 ) 32,572 Covenants not to compete 11,202 (8,693 ) 2,509 10,683 (7,657 ) 3,026 Other intangible assets 8,833 (3,097 ) 5,736 8,833 (2,409 ) 6,424 Total identifiable intangible assets $ 328,440 $ (200,552 ) $ 127,888 $ 322,102 $ (187,826 ) $ 134,276
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 three and six months ended August 31, 2015 and August 31, 2014 is summarized as follows (in thousands): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Cost of revenue $ 2,963 $ 2,830 $ 5,880 $ 5,790 Sales and marketing 2,009 1,992 4,014 3,574 Research and development 292 959 542 1,917 General and administrative 1,160 1,607 2,212 3,035 Total amortization expense $ 6,424 $ 7,388 $ 12,648 $ 14,316

Income Taxes (Tables)

Income Taxes (Tables)	6 Months Ended
	Aug. 31, 2015
Summary of Tax Provision	The following table summarizes the Company’s tax provision for the three and six months ended August 31, 2015 and August 31, 2014 (in thousands): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Income before provision for income taxes $ 72,387 $ 65,948 $ 140,114 $ 119,110 Estimated annual effective tax rate 29 % 29 % 29 % 29 % Provision for income taxes $ 20,992 $ 19,125 $ 40,633 $ 34,542

Assets and Liabilities Measur26

Assets and Liabilities Measured at Fair Value on a Recurring Basis (Tables)	6 Months Ended
	Aug. 31, 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 August 31, 2015 (in thousands): As of Quoted Prices In Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Money markets (1) $ 236,105 $ 236,105 $ — $ — Available-for-sale securities (1): U.S. agency securities 315,154 — 315,154 — Corporate securities 680,337 — 680,337 — Foreign government securities 8,732 — 8,732 — Foreign currency derivatives (2) 263 — 263 — Liabilities: Foreign currency derivatives (3) (67 ) — (67 ) — Total $ 1,240,524 $ 236,105 $ 1,004,419 $ — (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 August 31, 2015, in addition to $755.5 million of cash. (2) Included in Other current assets in the Company’s Consolidated Balance Sheet at August 31, 2015. (3) Included in Accounts payable and accrued expenses in the Company’s Consolidated Balance Sheet at August 31, 2015. 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 February 28, 2015 Quoted Prices In Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) 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.
Investments Measured at Fair Value	The following table represents the Company’s investments measured at fair value as of August 31, 2015 (in thousands): Balance Sheet Classification Amortized Cost Gross Unrealized Aggregate Fair Value Cash and Investments Investments Gains Losses (1) Money markets $ 236,105 $ — $ — $ 236,105 $ 236,105 $ — $ — U.S. agency securities 315,860 8 (714 ) 315,154 — 10,082 305,072 Corporate securities 680,238 415 (316 ) 680,337 — 161,992 518,345 Foreign government securities 8,721 11 — 8,732 — 8,732 — Total $ 1,240,924 $ 434 $ (1,030 ) $ 1,240,328 $ 236,105 $ 180,806 $ 823,417 (1) As of August 31, 2015, there were $0.5 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, 2015 (in thousands): Balance Sheet Classification Amortized Cost Gross Unrealized Aggregate Fair Value Cash and Investments Investments Gains Losses (1) 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.

Derivative Instruments (Tables)

Derivative Instruments (Tables)	6 Months Ended
	Aug. 31, 2015
Summary of Effects of Derivative Instruments	The effects of derivative instruments on the Company’s Consolidated Financial Statements are as follows as of August 31, 2015 and for the three and six months then ended (in thousands): As of August 31, 2015 Three Months 2015 Six Months Ended August 31, Balance Sheet Location Fair Value Notional Value Location of Gain (Loss) Recognized in Income on Derivatives Amount of Gain (Loss) Recognized in Income on Derivatives Assets—foreign currency forward contracts not designated as hedges Other current assets $ 263 $ 32,302 Other income (expense), net $ 592 $ 1,272 Liabilities—foreign currency forward contracts not designated as hedges Accounts payable and (67 ) 3,607 Other income (expense), net (437 ) (1,246 ) TOTAL $ 196 $ 35,909 $ 155 $ 26 The effects of derivative instruments on the Company’s Consolidated Financial Statements are as follows as of August 31, 2014 and for the three and six months then ended (in thousands): As of August 31, 2014 Three Months Six Months Ended August 31, Balance Sheet Location Fair Value Notional Value Location of Gain (Loss) Recognized in Income on Derivatives Amount of Gain (Loss) Recognized in Income on Derivatives Assets—foreign currency forward contracts not designated as hedges Other current assets $ 16 $ 4,441 Other income (expense), net $ 90 $ 264 Liabilities—foreign currency forward contracts not designated as hedges Accounts payable and (143 ) 17,764 Other income (expense), net (284 ) (541 ) TOTAL $ (127 ) $ 22,205 $ (194 ) $ (277 )

Share-based Awards (Tables)

Share-based Awards (Tables)	6 Months Ended
	Aug. 31, 2015
Share-Based Compensation Expense	The following summarizes share-based compensation expense recognized in the Company’s Consolidated Financial Statements for the three and six months ended August 31, 2015 and August 31, 2014 (in thousands): Three Months Ended Six Months Ended August 31, 2015 August 31, 2014 August 31, 2015 August 31, 2014 Cost of revenue $ 4,151 $ 3,425 $ 7,877 $ 6,543 Sales and marketing 16,782 13,691 32,194 23,929 Research and development 12,022 11,098 22,897 19,962 General and administrative 7,582 8,391 14,091 14,885 Total share-based compensation $ 40,537 $ 36,605 $ 77,059 $ 65,319
Summary of Share-Based Awards Granted During Period	During the three and six months ended August 31, 2015, the Company granted the following share-based awards: Three Months Ended Six Months Ended August 31, 2015 August 31, 2015 Shares and Shares Underlying Awards Weighted Average Per Share Fair Value Shares and Shares Underlying Awards Weighted Average Per Share Fair Value Service-based shares and share units 118,881 $ 80.58 926,477 $ 75.55 Performance share units—target (1) 112,360 $ 80.59 370,478 $ 78.28 Performance share awards (2) 56,180 $ 80.59 154,705 $ 78.48 Total awards 287,421 $ 80.59 1,451,660 $ 76.56 (1) Certain executives and senior management were awarded a target number of performance share units (“PSUs”). PSU grantees may earn up to 200% of the target number of PSUs. Half of the target number of PSUs can be earned by the grantees depending upon the Company’s financial performance measured against the financial performance of specified peer companies during a three-year performance period beginning on March 1, 2015. The remaining target number of PSUs can be earned by the grantees depending upon the Company’s total shareholder return performance measured against the total shareholder return of specified peer companies during a three-year period beginning on March 1, 2015. (2) Certain executives were granted restricted stock awards. These shares were awarded subject to the achievement of a specified dollar amount of revenue for FY2016 (the “RSA Performance Goal”). If the Company fails to achieve the RSA Performance Goal for FY2016, then all such shares are forfeited. If the Company achieves the RSA Performance Goal for FY2016, then 25% of the restricted stock vests on July 16, 2016, and the remainder vests ratably on a quarterly basis over the course of the subsequent three–year period, provided that the grantee’s business relationship with the Company has not ceased.

Earnings Per Share (Tables)

Earnings Per Share (Tables)	6 Months Ended
	Aug. 31, 2015
Reconciliation of Numerators and Denominators of Earnings Per Share Calculation	The following table reconciles the numerators and denominators of the earnings per share (“EPS”) calculation for the three and six months ended August 31, 2015 and August 31, 2014 (in thousands, except per share amounts): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Net income, basic and diluted $ 51,395 $ 46,823 $ 99,481 $ 84,568 Weighted average common shares outstanding 183,179 188,162 183,155 188,767 Incremental shares attributable to assumed vesting or exercise of outstanding equity award shares 2,986 2,593 3,009 2,368 Dilutive effect of convertible notes 585 — 329 — Diluted shares 186,750 190,755 186,493 191,135 Diluted net income per share $ 0.28 $ 0.25 $ 0.53 $ 0.44
Shares Considered Anti-Dilutive for Calculating Diluted EPS	The following employee share awards were 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): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Number of shares considered anti-dilutive for calculating diluted EPS 105 151 67 156

Segment Reporting (Tables)

Segment Reporting (Tables)	6 Months Ended
	Aug. 31, 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 and income (loss) from operations for the three and six months ended August 31, 2015 and August 31, 2014 and total cash, cash equivalents and available-for-sale investment securities and total assets as of August 31, 2015 and August 31, 2014, by geographic segment (in thousands): Americas EMEA Asia Pacific Corporate (1) Consolidated Three Months Ended August 31, 2015 Revenue from unaffiliated customers $ 332,204 $ 108,454 $ 63,490 $ — $ 504,148 Income (loss) from operations $ 73,944 $ 27,012 $ 16,051 $ (40,537 ) $ 76,470 Three Months Ended August 31, 2014 Revenue from unaffiliated customers $ 282,138 $ 103,496 $ 60,265 $ — $ 445,899 Income (loss) from operations $ 60,081 $ 26,066 $ 14,685 $ (36,605 ) $ 64,227 Six Months Ended August 31, 2015 Revenue from unaffiliated customers $ 654,037 $ 205,927 $ 125,185 $ — $ 985,149 Income (loss) from operations $ 149,475 $ 43,419 $ 31,564 $ (77,059 ) $ 147,399 Total cash, cash equivalents and available-for-sale investment securities $ 1,294,633 $ 490,607 $ 210,590 $ — $ 1,995,830 Total assets $ 2,735,505 $ 760,412 $ 305,554 $ — $ 3,801,471 Six Months Ended August 31, 2014 Revenue from unaffiliated customers $ 548,232 $ 204,270 $ 117,151 $ — $ 869,653 Income (loss) from operations $ 101,473 $ 50,251 $ 28,785 $ (65,319 ) $ 115,190 Total cash, cash equivalents and available-for-sale investment securities $ 621,806 $ 500,050 $ 195,087 $ — $ 1,316,943 Total assets $ 2,055,521 $ 720,493 $ 291,290 $ — $ 3,067,304 (1) Amounts represent share-based compensation expense for each of the three and six months ended August 31, 2015 and August 31, 2014, which was not allocated to geographic segments.
Summary of Revenue from Unaffiliated Customers	The following table lists, for each of the three and six months ended August 31, 2015 and August 31, 2014, revenue from unaffiliated customers in the United States, the Company’s country of domicile, and revenue from unaffiliated customers from foreign countries (in thousands): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, United States, the Company’s country of domicile $ 300,649 $ 247,556 $ 588,110 $ 481,863 Foreign 203,499 198,343 397,039 387,790 Total revenue from unaffiliated customers $ 504,148 $ 445,899 $ 985,149 $ 869,653
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 United States are summarized in the following table as of August 31, 2015 and February 28, 2015 (in thousands): As of As of United States, the Company’s country of domicile $ 126,166 $ 131,792 Foreign 38,552 40,359 Total tangible long-lived assets $ 164,718 $ 172,151
Summary of Subscription Revenue and Services by Technology Classes	The following table, for each of the three and six months ended August 31, 2015 and August 31, 2014, 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): Three Months Ended Six Months Ended August 31, August 31, August 31, August 31, Subscription revenue: Infrastructure-related offerings $ 362,926 $ 331,967 $ 716,667 $ 651,018 Application development-related and other emerging technology offerings 78,600 57,528 149,652 110,444 Total subscription revenue 441,526 389,495 866,319 761,462 Training and services revenue: Consulting services 47,266 41,917 90,466 80,990 Training 15,356 14,487 28,364 27,200 Total training and services revenue 62,622 56,404 118,830 108,190 Total subscription and training and services revenue $ 504,148 $ 445,899 $ 985,149 $ 869,652

Business Combinations (Tables)

Business Combinations (Tables)	6 Months Ended
	Aug. 31, 2015
Summary of Changes in Goodwill	The following is a summary of changes in goodwill for the six months ended August 31, 2015 (in thousands): Balance at February 28, 2015 $ 927,060 Impact of foreign currency fluctuations and other adjustments 1,118 Balance at August 31, 2015 $ 928,178
Feed Henry Enovance and Inktank Storage Inc
Pro Forma Consolidated Financial Information	The following unaudited pro forma consolidated financial information reflects the results of operations of the Company for the three and six months ended August 31, 2014 (in thousands, except per share amounts) as if the acquisitions of FeedHenry, eNovance and Inktank had closed on March 1, 2014, 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. Three Months Ended Six Months Ended August 31, 2014 August 31, 2014 Revenue $ 447,581 $ 874,727 Net income 44,253 74,945 Basic net income per common share $ 0.24 $ 0.40 Diluted net income per common share $ 0.23 $ 0.39

Convertible Notes (Tables)

Convertible Notes (Tables)	6 Months Ended
	Aug. 31, 2015
Components of Convertible Notes	As of August 31, 2015, the convertible notes consisted of the following (in thousands): As of Liability component Principal $ 805,000 Less: debt discount (80,379 ) Net carrying amount $ 724,621 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 three and six months ended August 31, 2015 (in thousands): Three Months Ended Six Months Ended August 31, 2015 August 31, 2015 Coupon rate 0.25% per year, payable semiannually $ 503 $ 1,006 Amortization of convertible note issuance costs - liability component 602 1,198 Accretion of debt discount 4,620 9,219 Total interest expense related to convertible notes $ 5,725 $ 11,423
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 the convertible notes (the carrying value excludes the equity component of the convertible notes classified in equity) is as follows (in thousands): As of August 31, 2015 Fair Value Carrying Value Convertible notes $ 744,570 $ 724,621

Summary of Significant Accoun33

Summary of Significant Accounting Policies - Additional Information (Detail) - Cloud-usage Service $ in Millions	6 Months Ended
	Aug. 31, 2015USD ($)
Subscriptions
Significant Accounting Policies [Line Items]
Additional favorable adjustment	$ 5.3
Income before provision for income taxes
Significant Accounting Policies [Line Items]
Additional favorable adjustment	$ 5.3

Summary of Changes in Stockhold

Summary of Changes in Stockholders' Equity (Detail) - USD ($) $ in Thousands	3 Months Ended			6 Months Ended
	Aug. 31, 2015	Nov. 30, 2014	Aug. 31, 2014	Aug. 31, 2015		Aug. 31, 2014
Beginning Balance	$ 1,349,423	$ 1,514,656	$ 1,524,803	$ 1,288,338	[1]	$ 1,551,165
Net income	51,395		46,823	99,481		84,568
Other comprehensive income (loss), net of tax	1,155		(10,667)	(4,828)		(11,566)
Exercise of common stock options	480		644	2,589		689
Common stock repurchase	(70,079)		(80,028)	(70,079)		(160,061)
Share-based compensation expense	40,537		36,605	77,059		65,319
Assumed employee share-based awards from a business acquisition						895
Tax benefits related to share-based awards	2,865		307	8,427		1,208
Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards	(7,726)		(3,831)	(32,937)		(17,561)
Ending Balance	1,368,050		1,514,656	1,368,050		1,514,656
Common Stock
Beginning Balance	23	23	23	23		23
Ending Balance	23		23	23		23
Additional Paid-in Capital
Beginning Balance	2,058,046	1,942,659	1,908,934	1,963,851		1,891,848
Exercise of common stock options	480		644	2,589		689
Common stock repurchase		(75,000)		75,000
Share-based compensation expense	40,537		36,605	77,059		65,319
Assumed employee share-based awards from a business acquisition						895
Tax benefits related to share-based awards	2,865		307	8,427		1,208
Minimum tax withholdings paid by the Company on behalf of employees related to net settlement of employee share-based awards	(7,726)		(3,831)	(32,937)		(17,561)
Other adjustments				213		261
Ending Balance	2,094,202		1,942,659	2,094,202		1,942,659
Retained Earnings
Beginning Balance	948,459	804,740	757,917	900,373		720,172
Net income	51,395		46,823	99,481		84,568
Ending Balance	999,854		804,740	999,854		804,740
Treasury Stock
Beginning Balance	(1,590,501)	(1,216,741)	(1,136,713)	(1,515,288)		(1,056,419)
Common stock repurchase	(70,079)	(300,000)	(80,028)	(145,079)		(160,061)
Other adjustments				(213)		(261)
Ending Balance	(1,660,580)		(1,216,741)	(1,660,580)		(1,216,741)
Accumulated Other Comprehensive Income (Loss)
Beginning Balance	(66,604)	$ (16,025)	(5,358)	(60,621)		(4,459)
Other comprehensive income (loss), net of tax	1,155		(10,667)	(4,828)		(11,566)
Ending Balance	$ (65,449)		$ (16,025)	$ (65,449)		$ (16,025)
[1]	Derived from audited financial statements.

Summary of Accumulated Other Co

Summary of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Thousands	Aug. 31, 2015	Feb. 28, 2015
Accumulated Other Comprehensive Income (Loss) [Line Items]
Accumulated loss from foreign currency translation adjustment	$ (63,992)	$ (60,986)
Accumulated unrealized gain, net of tax, on available-for-sale securities	(1,457)	365
Accumulated other comprehensive loss	$ (65,449)	$ (60,621)	[1]
[1]	Derived from audited financial statements.

Identifiable Intangible Asset36

Identifiable Intangible Assets - Additional Information (Detail) - USD ($) $ in Millions	6 Months Ended
	Aug. 31, 2015	Feb. 28, 2015
Acquired Finite-Lived Intangible Assets [Line Items]
Carrying amount for intangible assets	$ 11.3	$ 11.3
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 Intangi

Summary of Identifiable Intangible Assets (Detail) - USD ($) $ in Thousands	Aug. 31, 2015	Feb. 28, 2015
Finite-Lived Intangible Assets [Line Items]
Gross Amount	$ 328,440	$ 322,102
Accumulated Amortization	(200,552)	(187,826)
Net Amount	127,888	134,276	[1]
Trademarks, Copyrights and Patents
Finite-Lived Intangible Assets [Line Items]
Gross Amount	122,268	117,020
Accumulated Amortization	(45,901)	(42,630)
Net Amount	76,367	74,390
Purchased Technologies
Finite-Lived Intangible Assets [Line Items]
Gross Amount	82,016	81,482
Accumulated Amortization	(66,920)	(63,618)
Net Amount	15,096	17,864
Customer and Reseller Relationships
Finite-Lived Intangible Assets [Line Items]
Gross Amount	104,121	104,084
Accumulated Amortization	(75,941)	(71,512)
Net Amount	28,180	32,572
Covenants Not To Compete
Finite-Lived Intangible Assets [Line Items]
Gross Amount	11,202	10,683
Accumulated Amortization	(8,693)	(7,657)
Net Amount	2,509	3,026
Other Intangible Assets
Finite-Lived Intangible Assets [Line Items]
Gross Amount	8,833	8,833
Accumulated Amortization	(3,097)	(2,409)
Net Amount	$ 5,736	$ 6,424
[1]	Derived from audited financial statements.

Schedule of Amortization Expens

Schedule of Amortization Expense Associated with Identifiable Intangible Assets (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	$ 6,424	$ 7,388	$ 12,648	$ 14,316
Cost of Revenue
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	2,963	2,830	5,880	5,790
Sales and Marketing
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	2,009	1,992	4,014	3,574
Research and Development
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	292	959	542	1,917
General and Administrative
Finite-Lived Intangible Assets [Line Items]
Total amortization expense	$ 1,160	$ 1,607	$ 2,212	$ 3,035

Summary of Tax Provision (Detai

Summary of Tax Provision (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Reconciliation of Provision of Income Taxes [Line Items]
Income before provision for income taxes	$ 72,387	$ 65,948	$ 140,114	$ 119,110
Estimated annual effective tax rate	29.00%	29.00%	29.00%	29.00%
Provision for income taxes	$ 20,992	$ 19,125	$ 40,633	$ 34,542

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail)	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Income Taxes [Line Items]
Estimated effective tax rate excluding discrete tax items	29.00%	29.00%	29.00%	29.00%
Federal statutory rate	35.00%	35.00%	35.00%	35.00%

Fair Value of Assets and Liabil

Fair Value of Assets and Liabilities Acquired (Detail) - USD ($) $ in Thousands		Aug. 31, 2015		Feb. 28, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		$ 1,240,328		$ 1,161,190
Total		1,240,524		1,160,526
Foreign Exchange Contract
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Foreign currency derivatives, assets		263	[1]	74	[2]
Foreign currency derivatives, liabilities		(67)	[3]	(738)	[4]
Money Market Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		236,105	[5]	369,926	[6]
Interest-bearing Deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[6]			39
Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[6]			29,994
U.S. Agencies Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		315,154	[5]	276,287	[6]
Corporate Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		680,337	[5]	421,200	[6]
Foreign Government Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		8,732	[5]	63,744	[6]
Fair Value, Inputs, Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total		236,105		369,926
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		236,105	[5]	369,926	[6]
Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total		1,004,419		790,600
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		263	[1]	74	[2]
Foreign currency derivatives, liabilities		(67)	[3]	(738)	[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	[6]			39
Fair Value, Inputs, Level 2 | Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[6]			29,994
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		315,154	[5]	276,287	[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		680,337	[5]	421,200	[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		$ 8,732	[5]	$ 63,744	[6]
[1]	Included in Other current assets in the Company's Consolidated Balance Sheet at August 31, 2015.
[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 August 31, 2015.
[4]	Included in Accounts payable and accrued expenses in the Company's Consolidated Balance Sheet at February 28, 2015.
[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 August 31, 2015, in addition to $755.5 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, 2015, in addition to $647.6 million of cash.

Fair Value of Assets and Liab42

Fair Value of Assets and Liabilities Acquired (Parenthetical) (Detail) - USD ($) $ in Millions	Aug. 31, 2015	Feb. 28, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash	$ 755.5	$ 647.6

Investments Measured at Fair Va

Investments Measured at Fair Value (Detail) - USD ($) $ in Thousands		Aug. 31, 2015		Feb. 28, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost		$ 1,240,924		$ 1,161,005
Gross Unrealized Gains		434		1,291
Gross Unrealized Losses		(1,030)	[1]	(1,106)	[2]
Aggregate Fair Value		1,240,328		1,161,190
Cash and cash equivalents		236,105		399,920
Investments in debt securities, short-term		180,806		215,254	[3]
Investments in debt securities, long-term		823,417		546,016	[3]
Money Market Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost		236,105		369,926
Aggregate Fair Value		236,105	[4]	369,926	[5]
Cash and cash equivalents		236,105		369,926
Interest-bearing Deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost				39
Aggregate Fair Value	[5]			39
Investments in debt securities, short-term				39
Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost				29,994
Aggregate Fair Value	[5]			29,994
Cash and cash equivalents				29,994
U.S. Agencies Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost		315,860		276,928
Gross Unrealized Gains		8		13
Gross Unrealized Losses		(714)	[1]	(654)	[2]
Aggregate Fair Value		315,154	[4]	276,287	[5]
Investments in debt securities, short-term		10,082		5,002
Investments in debt securities, long-term		305,072		271,285
Corporate Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost		680,238		420,431
Gross Unrealized Gains		415		1,219
Gross Unrealized Losses		(316)	[1]	(450)	[2]
Aggregate Fair Value		680,337	[4]	421,200	[5]
Investments in debt securities, short-term		161,992		146,469
Investments in debt securities, long-term		518,345		274,731
Foreign Government Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Amortized Cost		8,721		63,687
Gross Unrealized Gains		11		59
Gross Unrealized Losses	[2]			(2)
Aggregate Fair Value		8,732	[4]	63,744	[5]
Investments in debt securities, short-term		$ 8,732		$ 63,744
[1]	As of August 31, 2015, there were $0.5 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, 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.
[3]	Derived from audited financial statements.
[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 August 31, 2015, in addition to $755.5 million of cash.
[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.

Investments Measured at Fair 44

Investments Measured at Fair Value (Parenthetical) (Detail) - USD ($) $ in Millions	Aug. 31, 2015	Feb. 28, 2015
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Accumulated unrealized losses related to investments	$ 0.5	$ 0.3

Summary of Effects of Derivativ

Summary of Effects of Derivative Instruments (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Derivative [Line Items]
Total, Fair Value	$ 196	$ (127)	$ 196	$ (127)
Amount of Gain (Loss) Recognized in Income on Derivative	155	(194)	26	(277)
Forward contracts
Derivative [Line Items]
Notional value of foreign currency foreign currency forward contracts not designated as hedges	35,909	22,205	35,909	22,205
Other Current Assets
Derivative [Line Items]
Assets-foreign currency forward contracts not designated as hedges	263	16	263	16
Notional value of foreign currency foreign currency forward contracts not designated as hedges, assets	32,302	4,441	32,302	4,441
Accounts Payable and Accrued Expenses
Derivative [Line Items]
Liabilities-foreign currency forward contracts not designated as hedges	(67)	(143)	(67)	(143)
Notional value of foreign currency foreign currency forward contracts not designated as hedges, liabilities	3,607	17,764	3,607	17,764
Other Income (Expense), Net | Derivative Assets
Derivative [Line Items]
Amount of Gain (Loss) Recognized in Income on Derivative	592	90	1,272	264
Other Income (Expense), Net | Derivative Liabilities
Derivative [Line Items]
Amount of Gain (Loss) Recognized in Income on Derivative	$ (437)	$ (284)	$ (1,246)	$ (541)

Share-Based Compensation Expens

Share-Based Compensation Expense (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total share-based compensation expense	$ 40,537	$ 36,605	$ 77,059	$ 65,319
Cost of Revenue
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total share-based compensation expense	4,151	3,425	7,877	6,543
Sales and Marketing
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total share-based compensation expense	16,782	13,691	32,194	23,929
Research and Development
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total share-based compensation expense	12,022	11,098	22,897	19,962
General and Administrative
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items]
Total share-based compensation expense	$ 7,582	$ 8,391	$ 14,091	$ 14,885

Share Based Awards - Additional

Share Based Awards - Additional Information (Detail) - USD ($)	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense capitalized	$ 0	$ 0	$ 0	$ 0
Annual forfeitures rate			10.00%

Summary of Share-Based Awards G

Summary of Share-Based Awards Granted During Period (Detail) - $ / shares		3 Months Ended	6 Months Ended
		Aug. 31, 2015	Aug. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares and Share units, Shares and Shares Underlying Awards		287,421	1,451,660
Shares and share units, Weighted Average Per Share Award Fair Value		$ 80.59	$ 76.56
Service Based Share Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares and Share units, Shares and Shares Underlying Awards		118,881	926,477
Shares and share units, Weighted Average Per Share Award Fair Value		$ 80.58	$ 75.55
Performance Share Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares and Share units, Shares and Shares Underlying Awards	[1]	112,360	370,478
Shares and share units, Weighted Average Per Share Award Fair Value	[1]	$ 80.59	$ 78.28
Performance Share Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares and Share units, Shares and Shares Underlying Awards	[2]	56,180	154,705
Shares and share units, Weighted Average Per Share Award Fair Value	[2]	$ 80.59	$ 78.48
[1]	Certain executives and senior management were awarded a target number of performance share units ("PSUs"). PSU grantees may earn up to 200% of the target number of PSUs. Half of the target number of PSUs can be earned by the grantees depending upon the Company's financial performance measured against the financial performance of specified peer companies during a three-year performance period beginning on March 1, 2015. The remaining target number of PSUs can be earned by the grantees depending upon the Company's total shareholder return performance measured against the total shareholder return of specified peer companies during a three-year period beginning on March 1, 2015.
[2]	Certain executives were granted restricted stock awards. These shares were awarded subject to the achievement of a specified dollar amount of revenue for FY2016 (the "RSA Performance Goal"). If the Company fails to achieve the RSA Performance Goal for FY2016, then all such shares are forfeited. If the Company achieves the RSA Performance Goal for FY2016, then 25% of the restricted stock vests on July 16, 2016, and the remainder vests ratably on a quarterly basis over the course of the subsequent three-year period, provided that the grantee's business relationship with the Company has not ceased.

Summary of Share-Based Awards49

Summary of Share-Based Awards Granted During Period (Parenthetical) (Detail)	6 Months Ended
	Aug. 31, 2015
Performance Share Units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Targeted percentage of performance share units earned by executive	200.00%
Performance Share Awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Percentage vested during following three years	25.00%

Reconciliation of Numerators an

Reconciliation of Numerators and Denominators of Earnings Per Share Calculation (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Earnings Per Share [Line Items]
Net income, basic and diluted	$ 51,395	$ 46,823	$ 99,481	$ 84,568
Weighted average common shares outstanding	183,179	188,162	183,155	188,767
Incremental shares attributable to assumed vesting or exercise of outstanding equity award shares	2,986	2,593	3,009	2,368
Dilutive effect of convertible notes	585		329
Diluted shares	186,750	190,755	186,493	191,135
Diluted net income per share	$ 0.28	$ 0.25	$ 0.53	$ 0.44

Earnings Per Share - Additional

Earnings Per Share - Additional Information (Detail) - Warrants	Aug. 31, 2015$ / sharesshares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Number of shares of common stock underlying the warrants	10,965,630
Exercise price per share | $ / shares	$ 101.65

Shares Considered Anti-Dilutive

Shares Considered Anti-Dilutive for Calculating Diluted EPS (Detail) - shares shares in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Number of shares considered anti-dilutive for calculating diluted EPS	105	151	67	156

Share Repurchase Programs - Add

Share Repurchase Programs - Additional Information (Detail) - USD ($)	Mar. 04, 2015	Oct. 07, 2014	Aug. 31, 2015	Nov. 30, 2014	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014	Mar. 25, 2015	Oct. 01, 2014
Accelerated Share Repurchases [Line Items]
Common stock authorized for stock repurchase program			$ 429,900,000			$ 429,900,000		$ 500,000,000
Repurchase of common stock, shares	720,101	5,312,555				894,915
Aggregate cost of common stock repurchased			70,079,000		$ 80,028,000	$ 70,079,000	$ 160,061,000
Repurchase of common stock, value		$ (375,000,000)							$ (375,000,000)
Percentage of shares deliverable to the company		80.00%
Repurchase of common stock, average price per share		$ 56.47
ASR Agreement
Accelerated Share Repurchases [Line Items]
Repurchase of common stock, shares						6,032,656
Treasury stock weighted average share price						$ 62.16
Treasury Stock
Accelerated Share Repurchases [Line Items]
Aggregate cost of common stock repurchased			$ 70,079,000	$ 300,000,000	$ 80,028,000	$ 145,079,000	$ 160,061,000
Additional Paid-in Capital
Accelerated Share Repurchases [Line Items]
Aggregate cost of common stock repurchased				$ 75,000,000		$ (75,000,000)

Summary of Revenue, Income (Los

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 ($) $ in Thousands		3 Months Ended		6 Months Ended
		Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014	Feb. 28, 2015	[1]
Segment Reporting Information [Line Items]
Revenue from unaffiliated customers		$ 504,148	$ 445,899	$ 985,149	$ 869,653
Income (loss) from operations		76,470	64,227	147,399	115,190
Total cash, cash equivalents and available-for-sale investment securities		1,995,830	1,316,943	1,995,830	1,316,943
Total assets		3,801,471	3,067,304	3,801,471	3,067,304	$ 3,802,985
Corporate
Segment Reporting Information [Line Items]
Income (loss) from operations	[2]	(40,537)	(36,605)	(77,059)	(65,319)
Americas
Segment Reporting Information [Line Items]
Revenue from unaffiliated customers		332,204	282,138	654,037	548,232
Income (loss) from operations		73,944	60,081	149,475	101,473
Total cash, cash equivalents and available-for-sale investment securities		1,294,633	621,806	1,294,633	621,806
Total assets		2,735,505	2,055,521	2,735,505	2,055,521
EMEA
Segment Reporting Information [Line Items]
Revenue from unaffiliated customers		108,454	103,496	205,927	204,270
Income (loss) from operations		27,012	26,066	43,419	50,251
Total cash, cash equivalents and available-for-sale investment securities		490,607	500,050	490,607	500,050
Total assets		760,412	720,493	760,412	720,493
Asia Pacific
Segment Reporting Information [Line Items]
Revenue from unaffiliated customers		63,490	60,265	125,185	117,151
Income (loss) from operations		16,051	14,685	31,564	28,785
Total cash, cash equivalents and available-for-sale investment securities		210,590	195,087	210,590	195,087
Total assets		$ 305,554	$ 291,290	$ 305,554	$ 291,290
[1]	Derived from audited financial statements.
[2]	Amounts represent share-based compensation expense for each of the three and six months ended August 31, 2015 and August 31, 2014, which was not allocated to geographic segments.

Summary of Revenue from Unaffil

Summary of Revenue from Unaffiliated Customers (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Segment Reporting Information [Line Items]
Total revenue from unaffiliated customers	$ 504,148	$ 445,899	$ 985,149	$ 869,653
United States
Segment Reporting Information [Line Items]
Total revenue from unaffiliated customers	300,649	247,556	588,110	481,863
Foreign
Segment Reporting Information [Line Items]
Total revenue from unaffiliated customers	$ 203,499	$ 198,343	$ 397,039	$ 387,790

Summary of Tangible Long-Lived

Summary of Tangible Long-Lived Assets (Detail) - USD ($) $ in Thousands	Aug. 31, 2015	Feb. 28, 2015
Segment Reporting, Asset Reconciling Item [Line Items]
Total tangible long-lived assets	$ 164,718	$ 172,151	[1]
United States
Segment Reporting, Asset Reconciling Item [Line Items]
Total tangible long-lived assets	126,166	131,792
Foreign
Segment Reporting, Asset Reconciling Item [Line Items]
Total tangible long-lived assets	$ 38,552	$ 40,359
[1]	Derived from audited financial statements.

Segment Reporting - Additional

Segment Reporting - Additional Information (Detail)	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
U.S. Government and Agencies | Subscription Revenues | Customer Concentration Risk
Segment Reporting Information [Line Items]
Percentage of revenue	10.00%	10.00%	10.00%	10.00%

Summary of Subscription and Ser

Summary of Subscription and Services Revenue by Technology Classes (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Revenue from External Customer [Line Items]
Subscription revenue	$ 441,526	$ 389,495	$ 866,319	$ 761,462
Training and services revenue	62,622	56,404	118,830	108,191
Total subscription and training and services revenue	504,148	445,899	985,149	869,653
Infrastructure Related Subscriptions
Revenue from External Customer [Line Items]
Subscription revenue	362,926	331,967	716,667	651,018
Application Development Related and Other Emerging Technology Subscriptions
Revenue from External Customer [Line Items]
Subscription revenue	78,600	57,528	149,652	110,444
Consulting Services
Revenue from External Customer [Line Items]
Training and services revenue	47,266	41,917	90,466	80,990
Training Services
Revenue from External Customer [Line Items]
Training and services revenue	$ 15,356	$ 14,487	$ 28,364	$ 27,200

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Aug. 31, 2015	Aug. 31, 2014	Aug. 31, 2015	Aug. 31, 2014
Commitments and Contingencies [Line Items]
Rent expense under operating leases	$ 7.8	$ 7.5	$ 15.5	$ 15

Business Combinations - Additio

Business Combinations - Additional Information (Detail) - USD ($) $ in Thousands	Oct. 08, 2014	Jun. 24, 2014	Apr. 30, 2014	Aug. 31, 2015	Aug. 31, 2015	Feb. 28, 2015
Business Acquisition [Line Items]
Goodwill acquired				$ 928,178	$ 928,178	$ 927,060	[1]
Shares and Share units, Shares and Shares Underlying Awards				287,421	1,451,660
FeedHenry
Business Acquisition [Line Items]
Cash consideration paid	$ 80,200
Goodwill acquired	68,500
Identifiable intangible assets acquired	9,000
Working capital	$ 2,700
eNovance, SAS
Business Acquisition [Line Items]
Cash consideration paid		$ 67,600
Goodwill acquired		60,800
Identifiable intangible assets acquired		5,300
Working capital		$ 1,500
eNovance, SAS | Restricted Stock
Business Acquisition [Line Items]
Shares and Share units, Shares and Shares Underlying Awards						529,057
eNovance, SAS | Restricted Stock | Employment Condition
Business Acquisition [Line Items]
Share-based awards, annual vesting percentage						25.00%
Inktank Storage, Inc.
Business Acquisition [Line Items]
Cash consideration paid			$ 152,500
Goodwill acquired			131,400
Identifiable intangible assets acquired			10,800
Working capital			$ 10,300
[1]	Derived from audited financial statements.

Pro Forma Consolidated Financia

Pro Forma Consolidated Financial Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	6 Months Ended
	Aug. 31, 2014	Aug. 31, 2014
Business Acquisition, Pro Forma Information [Line Items]
Revenue	$ 447,581	$ 874,727
Net income	$ 44,253	$ 74,945
Basic net income per common share	$ 0.24	$ 0.40
Diluted net income per common share	$ 0.23	$ 0.39

Summary of Changes in Goodwill

Summary of Changes in Goodwill (Detail) $ in Thousands	6 Months Ended
	Aug. 31, 2015USD ($)
Goodwill [Line Items]
Goodwill, beginning balance	$ 927,060	[1]
Impact of foreign currency fluctuations and other adjustments	1,118
Goodwill, ending balance	$ 928,178
[1]	Derived from audited financial statements.

Convertible Notes - Additional

Convertible Notes - Additional Information (Detail) - USD ($)	Oct. 07, 2014	Oct. 01, 2014	Aug. 31, 2015	Aug. 31, 2015	Nov. 30, 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
Repurchase of common stock, value	(375,000,000)	$ (375,000,000)
Repurchase of note principal amount				100.00%
Premium on closing price of common stock		80.00%
Warrants
Debt Instrument [Line Items]
Strike price of warrants		$ 101.65
Number of shares of common stock underlying the warrants		10,965,630
0.25% Convertible Senior Notes due 2019
Debt Instrument [Line Items]
Debt instrument, aggregate principal amount	$ 805,000,000
Debt instrument, interest rate	0.25%		0.25%	0.25%
Debt instrument, offering date	Oct. 1, 2014
Frequency of interest payment			Semiannually	Semiannually
Transaction cost related to note issuance	$ 15,200,000
Transaction cost related to note issuance allocated to equity component	1,800,000
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]
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%
Debt instrument, maturity date	Oct. 1, 2019
Frequency of interest payment				Semiannually in arrears on April 1 and October 1 of each year, and began on April 1, 2015
Common stock conversion rate per $1,000 principal amount of notes				13.6219
Principal amount per note			$ 1,000	$ 1,000
Debt instrument, convertible, conversion price, per share		$ 101.65	$ 73.41	$ 73.41	$ 73.41
Premium on closing price of common stock		30.00%
Closing price of common stock		$ 56.47

Components of Convertible Notes

Components of Convertible Notes (Detail) - USD ($) $ in Thousands		Aug. 31, 2015	Feb. 28, 2015	[1]
Debt Instrument [Line Items]
Net carrying amount		$ 724,621	$ 715,402
0.25% Convertible Senior Notes due 2019
Debt Instrument [Line Items]
Principal		805,000
Less: debt discount		(80,379)
Net carrying amount		724,621
Equity component	[2]	$ 96,890
[1]	Derived from audited financial statements.
[2]	Recorded in the Consolidated Balance Sheet in Additional paid-in capital.

Schedule of Total Interest Expe

Schedule of Total Interest Expense Recognized Related to Convertible Notes (Detail) - 0.25% Convertible Senior Notes due 2019 - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Aug. 31, 2015	Aug. 31, 2015
Debt Instrument [Line Items]
Coupon rate 0.25% per year, payable semiannually	$ 503	$ 1,006
Amortization of convertible note issuance costs - liability component	602	1,198
Accretion of debt discount	4,620	9,219
Total interest expense related to convertible notes	$ 5,725	$ 11,423

Schedule of Total Interest Ex66

Schedule of Total Interest Expense Recognized Related to Convertible Notes (Parenthetical) (Detail) - 0.25% Convertible Senior Notes due 2019	3 Months Ended	6 Months Ended
	Aug. 31, 2015	Aug. 31, 2015	Oct. 07, 2014
Debt Instrument [Line Items]
Coupon rate per year	0.25%	0.25%	0.25%
Frequency of coupon payment	Semiannually	Semiannually

Fair Value of Notes Based on In

Fair Value of Notes Based on Inputs Observable in Market (Level 2) and Carrying Value of Debt Instruments (Detail) - USD ($) $ in Thousands	Aug. 31, 2015	Feb. 28, 2015	[1]
Debt Instrument [Line Items]
Carrying value, convertible notes	$ 724,621	$ 715,402
Fair Value, Inputs, Level 2
Debt Instrument [Line Items]
Fair value, convertible notes	$ 744,570
[1]	Derived from audited financial statements.