DEI Document
DEI Document - USD ($) $ in Millions | 12 Months Ended | ||
Jun. 30, 2015 | Jul. 17, 2015 | Dec. 31, 2014 | |
DEI [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | KLA TENCOR CORP | ||
Entity Central Index Key | 319,201 | ||
Entity Filer Category | Large Accelerated Filer | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Well-known Seasoned Issuer | Yes | ||
Trading Symbol | klac | ||
Entity Common Stock, Shares Outstanding | 157,530,878 | ||
Entity Public Float | $ 11,450 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 838,025 | $ 630,861 |
Marketable securities | 1,549,086 | 2,521,776 |
Accounts receivable, net | 585,494 | 492,863 |
Inventories | 617,904 | 656,457 |
Deferred income taxes | 236,253 | 215,676 |
Other current assets | 77,814 | 68,462 |
Total current assets | 3,904,576 | 4,586,095 |
Land, property and equipment, net | 314,591 | 330,263 |
Goodwill | 335,263 | 335,355 |
Purchased intangibles, net | 11,895 | 27,697 |
Other non-current assets | 259,687 | 256,436 |
Total assets | 4,826,012 | 5,535,846 |
Current liabilities: | ||
Accounts payable | 103,342 | 103,422 |
Deferred system profit | 148,691 | 147,923 |
Unearned revenue | 71,335 | 59,176 |
Current portion of long-term debt | 16,981 | 0 |
Other current liabilities | 661,414 | 585,090 |
Total current liabilities | 1,001,763 | 895,611 |
Non-current liabilities: | ||
Long-term debt | 3,173,435 | 745,101 |
Unearned revenue | 47,145 | 57,500 |
Other non-current liabilities | 182,230 | 168,288 |
Total liabilities | $ 4,404,573 | $ 1,866,500 |
Commitments and contingencies (Notes 13 and 14) | ||
Stockholders’ equity: | ||
Preferred stock, $0.001 par value, 1,000 shares authorized, none outstanding | $ 0 | $ 0 |
Common stock, $0.001 par value, 500,000 shares authorized, 259,007 and 257,542 shares issued, 157,851 and 165,448 shares outstanding, as of June 30, 2015 and June 30, 2014, respectively | 158 | 165 |
Capital in excess of par value | 474,216 | 1,220,339 |
Retained earnings (accumulated deficit) | (12,362) | 2,479,113 |
Accumulated other comprehensive income (loss) | (40,573) | (30,271) |
Total stockholders’ equity | 421,439 | 3,669,346 |
Total liabilities and stockholders’ equity | $ 4,826,012 | $ 5,535,846 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - $ / shares | Jun. 30, 2015 | Jun. 30, 2014 |
Preferred stock, par value per share | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value per share | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares, issued | 259,007,000 | 257,542,000 |
Common stock, shares, outstanding | 157,851,000 | 165,448,000 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Revenues: | |||
Product | $ 2,125,396 | $ 2,286,437 | $ 2,247,147 |
Service | 688,653 | 642,971 | 595,634 |
Total revenues | 2,814,049 | 2,929,408 | 2,842,781 |
Costs and expenses: | |||
Costs of revenues | 1,215,229 | 1,232,962 | 1,237,452 |
Engineering, research and development | 530,616 | 539,469 | 487,832 |
Selling, general and administrative | 406,864 | 384,907 | 387,812 |
Loss on extinguishment of debt and other, net | 131,669 | 0 | 0 |
Interest expense | 106,009 | 53,812 | 54,176 |
Other expense (income), net | (10,469) | (16,203) | (15,112) |
Total income before income taxes | 434,131 | 734,461 | 690,621 |
Provision for income taxes | 67,973 | 151,706 | 147,472 |
Net income | $ 366,158 | $ 582,755 | $ 543,149 |
Net income per share: | |||
Basic (in dollars per share) | $ 2.26 | $ 3.51 | $ 3.27 |
Diluted (in dollars per share) | 2.24 | 3.47 | 3.21 |
Cash dividends declared per share (in dollars per share) | $ 18.5 | $ 1.8 | $ 1.6 |
Weighted-average number of shares: | |||
Basic | 162,282 | 166,016 | 166,089 |
Diluted | 163,701 | 168,118 | 169,260 |
Consolidated Statements of Ope5
Consolidated Statements of Operations (Parentheticals) - $ / shares | Nov. 19, 2014 | Dec. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 18.5 | $ 1.8 | $ 1.6 | ||
Special Cash Dividend | |||||
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 16.50 | $ 16.50 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 366,158 | $ 582,755 | $ 543,149 |
Currency translation adjustments: | |||
Change in currency translation adjustments | (20,740) | 6,428 | (11,298) |
Change in income tax benefit or expense | 8,086 | (1,232) | (750) |
Net change related to currency translation adjustments | (12,654) | 5,196 | (12,048) |
Cash flow hedges: | |||
Change in net unrealized gains or losses | 13,745 | 1,641 | 4,929 |
Reclassification adjustments for net gains or losses included in net income | (6,615) | (4,145) | (1,483) |
Change in income tax benefit or expense | (2,565) | 898 | (1,233) |
Net change related to cash flow hedges | 4,565 | (1,606) | 2,213 |
Net change related to unrecognized losses and transition obligations in connection with defined benefit plans | (147) | (617) | (2,255) |
Available-for-sale securities: | |||
Change in net unrealized gains or losses | (1,069) | 7,212 | (2,953) |
Reclassification adjustments for net gains or losses included in net income | (2,119) | (2,084) | (2,287) |
Change in income tax benefit or expense | 1,122 | (1,726) | 1,827 |
Net change related to available-for-sale securities | (2,066) | 3,402 | (3,413) |
Other comprehensive income (loss) | (10,302) | 6,375 | (15,503) |
Total comprehensive income | $ 355,856 | $ 589,130 | $ 527,646 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock and Capital in Excess of Par Value, Shares | Common Stock and Capital in Excess of Par Value, Amount | Retained Earnings | Accumulated Other Comprehensive Income (Loss) |
Beginning Balance, shares at Jun. 30, 2012 | 166,710,000 | ||||
Beginning Balance at Jun. 30, 2012 | $ 3,315,595 | $ 1,089,480 | $ 2,247,258 | $ (21,143) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 543,149 | 543,149 | |||
Other comprehensive income (loss) | (15,503) | (15,503) | |||
Net issuance under employee stock plans, shares | 4,099,000 | ||||
Net issuance under employee stock plans | 96,989 | 96,989 | |||
Repurchase of common stock, shares | (5,374,000) | ||||
Repurchase of common stock | (273,254) | (107,973) | (165,281) | ||
Cash dividends declared | (265,893) | (265,893) | |||
Stock-based compensation expense | 70,084 | 70,084 | |||
Tax benefit for equity awards | 10,985 | 10,985 | |||
Ending Balance, shares at Jun. 30, 2013 | 165,435,000 | ||||
Ending Balance at Jun. 30, 2013 | 3,482,152 | 1,159,565 | 2,359,233 | (36,646) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 582,755 | 582,755 | |||
Other comprehensive income (loss) | 6,375 | 6,375 | |||
Net issuance under employee stock plans, shares | 3,848,000 | ||||
Net issuance under employee stock plans | 60,320 | 60,320 | |||
Repurchase of common stock, shares | (3,835,000) | ||||
Repurchase of common stock | (240,843) | (76,839) | (164,004) | ||
Cash dividends declared | (298,871) | (298,871) | |||
Stock-based compensation expense | 60,940 | 60,940 | |||
Tax benefit for equity awards | $ 16,518 | 16,518 | |||
Ending Balance, shares at Jun. 30, 2014 | 165,448,000 | 165,448,000 | |||
Ending Balance at Jun. 30, 2014 | $ 3,669,346 | 1,220,504 | 2,479,113 | (30,271) | |
Increase (Decrease) in Stockholders' Equity | |||||
Net income | 366,158 | 366,158 | |||
Other comprehensive income (loss) | (10,302) | (10,302) | |||
Net issuance under employee stock plans, shares | 1,658,000 | ||||
Net issuance under employee stock plans | 16,186 | 16,186 | |||
Repurchase of common stock, shares | (9,255,000) | ||||
Repurchase of common stock | (608,856) | (26,891) | (581,965) | ||
Cash dividends declared | (3,083,059) | (807,391) | (2,275,668) | ||
Stock-based compensation expense | 55,302 | 55,302 | |||
Tax benefit for equity awards | $ 16,664 | 16,664 | |||
Ending Balance, shares at Jun. 30, 2015 | 157,851,000 | 157,851,000 | |||
Ending Balance at Jun. 30, 2015 | $ 421,439 | $ 474,374 | $ (12,362) | $ (40,573) |
Consolidated Statements of Sto8
Consolidated Statements of Stockholders' Equity (Parentheticals) - $ / shares | Nov. 19, 2014 | Dec. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Cash dividends declared per share (in dollars per share) | $ 18.5 | $ 1.8 | $ 1.6 | ||
Special Cash Dividend | |||||
Cash dividends declared per share (in dollars per share) | $ 16.50 | $ 16.50 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Cash flows from operating activities: | |||
Net income | $ 366,158 | $ 582,755 | $ 543,149 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 80,536 | 83,072 | 87,534 |
Asset impairment charges | 2,126 | 1,374 | 1,327 |
Loss on extinguishment of debt and other, net | 131,669 | 0 | 0 |
Net gain on sale of assets | 0 | 0 | (1,160) |
Non-cash stock-based compensation expense | 55,302 | 60,940 | 70,084 |
Deferred income taxes | (24,245) | 17,176 | 4,532 |
Excess tax benefit from equity awards | (15,403) | (20,554) | (14,198) |
Net gain on sale of marketable securities and other investments | (2,119) | (5,920) | (2,287) |
Changes in assets and liabilities, net of impact of acquisition of business: | |||
Decrease (increase) in accounts receivable, net | (118,520) | 32,591 | 159,245 |
Decrease (increase) in inventories | 27,500 | (26,173) | 14,787 |
Decrease (increase) in other assets | 11,135 | (26,265) | 6,035 |
Increase (decrease) in accounts payable | 848 | (12,333) | (22,812) |
Increase (decrease) in deferred system profit | 768 | (10,042) | 10,748 |
Increase in other liabilities | 90,151 | 102,265 | 56,204 |
Net cash provided by operating activities | 605,906 | 778,886 | 913,188 |
Cash flows from investing activities: | |||
Acquisition of non-marketable securities | 0 | (1,345) | 0 |
Acquisition of business | 0 | (18,000) | 0 |
Capital expenditures, net | (45,791) | (67,502) | (74,573) |
Proceeds from sale of assets | 0 | 3,836 | 1,838 |
Purchase of available-for-sale securities | (1,731,551) | (1,834,223) | (1,588,093) |
Proceeds from sale of available-for-sale securities | 1,993,396 | 987,512 | 1,117,511 |
Proceeds from maturity of available-for-sale securities | 699,108 | 251,876 | 300,209 |
Purchase of trading securities | (60,808) | (64,053) | (40,850) |
Proceeds from sale of trading securities | 63,867 | 65,790 | 42,511 |
Net cash provided by (used in) investing activities | 918,221 | (676,109) | (241,447) |
Cash flows from financing activities: | |||
Proceeds from issuance of debt, net of issuance costs | 3,224,906 | 0 | 0 |
Repayment of debt | (916,117) | 0 | 0 |
Issuance of common stock | 47,008 | 112,221 | 126,121 |
Tax withholding payments related to vested and released restricted stock units | (30,229) | (51,948) | (29,682) |
Common stock repurchases | (602,888) | (240,843) | (273,254) |
Payment of dividends to stockholders | (3,041,055) | (298,871) | (265,893) |
Excess tax benefit from equity awards | 15,403 | 20,554 | 14,198 |
Net cash used in financing activities | (1,302,972) | (458,887) | (428,510) |
Effect of exchange rate changes on cash and cash equivalents | (13,991) | 1,581 | (9,135) |
Net increase (decrease) in cash and cash equivalents | 207,164 | (354,529) | 234,096 |
Cash and cash equivalents at beginning of period | 630,861 | 985,390 | 751,294 |
Cash and cash equivalents at end of period | 838,025 | 630,861 | 985,390 |
Supplemental cash flow disclosures: | |||
Income taxes paid, net | 69,681 | 117,348 | 120,342 |
Interest paid | 92,982 | 52,474 | 53,693 |
Non-cash activities: | |||
Purchase of land, property and equipment - investing activities | 1,843 | 3,457 | 6,839 |
Dividends payable - financing activities | $ 42,002 | $ 0 | $ 0 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Description of Operations and Principles of Consolidation. KLA-Tencor Corporation (“KLA-Tencor” or the “Company”) is a leading supplier of process control and yield management solutions for the semiconductor and related nanoelectronics industries. Headquartered in Milpitas, California, KLA-Tencor has subsidiaries both in the United States and in key markets throughout the world. The Consolidated Financial Statements include the accounts of KLA-Tencor and its majority-owned subsidiaries. All significant intercompany balances and transactions have been eliminated. Management Estimates. The preparation of the Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions in applying the Company’s accounting policies that affect the reported amounts of assets and liabilities (and related disclosure of contingent assets and liabilities) at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Cash Equivalents and Marketable Securities. All highly liquid debt instruments with original or remaining maturities of less than three months at the date of purchase are considered to be cash equivalents. Marketable securities are generally classified as available-for-sale for use in current operations, if required, and are reported at fair value, with unrealized gains and losses, net of tax, presented as a separate component of stockholders’ equity under the caption “Accumulated other comprehensive income (loss).” All realized gains and losses and unrealized losses resulting from declines in fair value that are other than temporary are recorded in earnings in the period of occurrence. The specific identification method is used to determine the realized gains and losses on investments. For all investments in debt and equity securities, the Company assesses whether the impairment is other than temporary. If the fair value of a debt security is less than its amortized cost basis, an impairment is considered other than temporary if (i) the Company has the intent to sell the security or it is more likely than not that the Company will be required to sell the security before recovery of its entire amortized cost basis, or (ii) the Company does not expect to recover the entire amortized cost of the security. If an impairment is considered other than temporary based on condition (i), the entire difference between the amortized cost and the fair value of the security is recognized in earnings. If an impairment is considered other than temporary based on condition (ii), the amount representing credit losses, defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis of the debt security, will be recognized in earnings, and the amount relating to all other factors will be recognized in other comprehensive income (loss). The Company evaluates both qualitative and quantitative factors such as duration and severity of the unrealized losses, credit ratings, default and loss rates of the underlying collateral, structure and credit enhancements to determine if a credit loss may exist. Non-Marketable Equity Securities and Other Investments. KLA-Tencor acquires certain equity investments for the promotion of business and strategic objectives, and, to the extent these investments continue to have strategic value, the Company typically does not attempt to reduce or eliminate the inherent market risks. Non-marketable equity securities and other investments are recorded at historical cost. Non-marketable equity securities and other investments are included in “Other non-current assets” on the balance sheet. Non-marketable equity securities are subject to a periodic impairment review; however, there are no open-market valuations, and the impairment analysis requires significant judgment. This analysis includes assessment of the investee’s financial condition, the business outlook for its products and technology, its projected results and cash flow, the likelihood of obtaining subsequent rounds of financing and the impact of any relevant contractual equity preferences held by the Company or others. Variable Interest Entities. KLA-Tencor uses a qualitative approach in assessing the consolidation requirement for variable interest entities. The approach focuses on identifying which enterprise has the power to direct the activities that most significantly impact the variable interest entity’s economic performance and which enterprise has the obligation to absorb losses or the right to receive benefits from the variable interest entity. In the event that the Company is the primary beneficiary of a variable interest entity, the assets, liabilities, and results of operations of the variable interest entity will be included in the Company’s Consolidated Financial Statements. The Company has concluded that none of the Company’s equity investments require consolidation as per the Company’s most recent qualitative assessment. Inventories. Inventories are stated at the lower of cost (on a first-in, first-out basis) or market. Demonstration units are stated at their manufacturing cost and written down to their net realizable value. The Company reviews and sets standard costs semi-annually at current manufacturing costs in order to approximate actual costs. The Company’s manufacturing overhead standards for product costs are calculated assuming full absorption of forecasted spending over projected volumes, adjusted for excess capacity. Abnormal inventory costs such as costs of idle facilities, excess freight and handling costs, and spoilage are recognized as current period charges. The Company writes down product inventory based on forecasted demand and technological obsolescence and service spare parts inventory based on forecasted usage. These factors are impacted by market and economic conditions, technology changes, new product introductions and changes in strategic direction and require estimates that may include uncertain elements. Actual demand may differ from forecasted demand, and such differences may have a material effect on recorded inventory values. Allowance for Doubtful Accounts. A majority of the Company’s trade receivables are derived from sales to large multinational semiconductor manufacturers throughout the world. In order to monitor potential credit losses, the Company performs ongoing credit evaluations of its customers’ financial condition. An allowance for doubtful accounts is maintained for probable credit losses based upon the Company’s assessment of the expected collectibility of the accounts receivable. The allowance for doubtful accounts is reviewed on a quarterly basis to assess the adequacy of the allowance. Property and Equipment. Property and equipment are recorded at cost, net of accumulated depreciation. Depreciation of property and equipment is based on the straight-line method over the estimated useful lives of the assets. The following table sets forth the estimated useful life for various asset categories: Asset Category Period Buildings 30 to 35 years Leasehold improvements Shorter of 10 to 15 years or lease term Machinery and equipment 2 to 5 years Office furniture and fixtures 5 to 7 years Construction-in-process assets are not depreciated until the assets are placed in service. Depreciation expense for the fiscal years ended June 30, 2015 , 2014 and 2013 was $55.8 million , $51.1 million and $49.3 million , respectively. Business Combinations. KLA-Tencor allocates the fair value of the purchase consideration of the Company’s acquisitions to the tangible assets, liabilities, and intangible assets acquired, including in-process research and development (“IPR&D”), based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. IPR&D is initially capitalized at fair value as an intangible asset with an indefinite life and assessed for impairment thereafter. When a project underlying reported IPR&D is completed, the corresponding amount of IPR&D is reclassified as an amortizable purchased intangible asset and is amortized over the asset’s estimated useful life. Acquisition-related expenses and restructuring costs are recognized separately from the business combination and are expensed as incurred. Goodwill and Intangible Assets. KLA-Tencor assesses goodwill for impairment annually as well as whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Long-lived intangible assets are tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. See Note 6, “Goodwill and Purchased Intangible Assets” for a detailed description. Impairment of Long-Lived Assets. KLA-Tencor evaluates the carrying value of its long-lived assets whenever events or changes in circumstances indicate that the carrying value of the asset may be impaired. An impairment loss is recognized when estimated future cash flows expected to result from the use of the asset, including disposition, are less than the carrying value of the asset. Such an impairment charge would be measured as the excess of the carrying value of the asset over its fair value. Concentration of Credit Risk. Financial instruments that potentially subject KLA-Tencor to significant concentrations of credit risk consist primarily of cash equivalents, short-term marketable securities, trade accounts receivable and derivative financial instruments used in hedging activities. The Company invests in a variety of financial instruments, such as, but not limited to, certificates of deposit, corporate debt and municipal securities, United States Treasury and Government agency securities, and equity securities and, by policy, limits the amount of credit exposure with any one financial institution or commercial issuer. The Company has not experienced any material credit losses on its investments. A majority of the Company’s trade receivables are derived from sales to large multinational semiconductor manufacturers located throughout the world, with a majority located in Asia. In recent years, the Company’s customer base has become increasingly concentrated due to corporate consolidation, acquisitions and business closures, and to the extent that these customers experience liquidity issues in the future, the Company may be required to incur additional bad debt expense with respect to trade receivables. The Company performs ongoing credit evaluations of its customers’ financial condition and generally requires no collateral to secure accounts receivable. The Company maintains an allowance for potential credit losses based upon expected collectibility risk of all accounts receivable. In addition, the Company may utilize letters of credit or non-recourse factoring to mitigate credit risk when considered appropriate. The Company is exposed to credit loss in the event of non-performance by counterparties on the foreign exchange contracts that the Company uses in hedging activities and in certain factoring transactions. These counterparties are large international financial institutions, and to date no such counterparty has failed to meet its financial obligations to the Company under such contracts. The following customers each accounted for more than 10% of total revenues for the indicated periods: Year ended June 30, 2015 2014 2013 Intel Corporation Intel Corporation Intel Corporation Samsung Electronics Co., Ltd. Samsung Electronics Co., Ltd. Taiwan Semiconductor Manufacturing Company Limited Taiwan Semiconductor Manufacturing Company Limited Taiwan Semiconductor Manufacturing Company Limited The following customers each accounted for more than 10% of net accounts receivable as of the dates indicated below: As of June 30, 2015 2014 Taiwan Semiconductor Manufacturing Company Limited Intel Corporation Taiwan Semiconductor Manufacturing Company Limited Foreign Currency. The functional currencies of KLA-Tencor’s foreign subsidiaries are the local currencies, except as described below. Accordingly, all assets and liabilities of these foreign operations are translated to U.S. dollars at current period end exchange rates, and revenues and expenses are translated to U.S. dollars using average exchange rates in effect during the period. The gains and losses from foreign currency translation of these subsidiaries’ financial statements are recorded directly into a separate component of stockholders’ equity under the caption “Accumulated other comprehensive income (loss).” The Company’s manufacturing subsidiaries in Singapore, Israel, Germany and China use the U.S. dollar as their functional currency. Accordingly, monetary assets and liabilities in non-functional currency of these subsidiaries are remeasured using exchange rates in effect at the end of the period. Revenues and costs in local currency are remeasured using average exchange rates for the period, except for costs related to those balance sheet items that are remeasured using historical exchange rates. The resulting remeasurement gains and losses are included in the Consolidated Statements of Operations as incurred. Derivative Financial Instruments. KLA-Tencor uses financial instruments, such as forward exchange contracts and currency options, to hedge a portion of, but not all, existing and forecasted foreign currency denominated transactions. The purpose of the Company’s foreign currency program is to manage the effect of exchange rate fluctuations on certain foreign currency denominated revenues, costs and eventual cash flows. The effect of exchange rate changes on forward exchange contracts is expected to offset the effect of exchange rate changes on the underlying hedged items. The Company believes these financial instruments do not subject the Company to speculative risk that would otherwise result from changes in currency exchange rates. All of the Company’s derivative financial instruments are recorded at fair value based upon quoted market prices for comparable instruments adjusted for risk of counterparty non-performance. For derivative instruments designated and qualifying as cash flow hedges of forecasted foreign currency denominated transactions expected to occur within twelve months, the effective portion of the gain or loss on these hedges is reported as a component of “Accumulated other comprehensive income (loss)” in stockholders’ equity, and is reclassified into earnings when the hedged transaction affects earnings. If the transaction being hedged fails to occur, or if a portion of any derivative is (or becomes) ineffective, the gain or loss on the associated financial instrument is recorded immediately in earnings. For derivative instruments used to hedge existing foreign currency denominated assets or liabilities, the gains or losses on these hedges are recorded immediately in earnings to offset the changes in the fair value of the assets or liabilities being hedged. Warranty. The Company provides standard warranty coverage on its systems for 40 hours per week for 12 months, providing labor and parts necessary to repair the systems during the warranty period. The Company accounts for the estimated warranty cost as a charge to costs of revenues when revenue is recognized. The estimated warranty cost is based on historical product performance and field expenses. Utilizing actual service records, the Company calculates the average service hours and parts expense per system and applies the actual labor and overhead rates to determine the estimated warranty charge. The Company updates these estimated charges on a regular basis. The actual product performance and/or field expense profiles may differ, and in those cases the Company adjusts its warranty accruals accordingly (see Note 13, “Commitments and Contingencies”). Revenue Recognition. The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectibility is reasonably assured. The Company derives revenue from three sources-sales of systems, spare parts and services. In general, the Company recognizes revenue for systems when the system has been installed, is operating according to predetermined specifications and is accepted by the customer. When the Company has demonstrated a history of successful installation and acceptance, the Company recognizes revenue upon delivery and customer acceptance. Under certain circumstances, however, the Company recognizes revenue prior to acceptance from the customer, as follows: • When the customer fab has previously accepted the same tool, with the same specifications, and when the Company can objectively demonstrate that the tool meets all of the required acceptance criteria. • When system sales to independent distributors have no installation requirement, contain no acceptance agreement, and 100% payment is due based upon shipment. • When the installation of the system is deemed perfunctory. • When the customer withholds acceptance due to issues unrelated to product performance, in which case revenue is recognized when the system is performing as intended and meets predetermined specifications. In circumstances in which the Company recognizes revenue prior to installation, the portion of revenue associated with installation is deferred based on estimated fair value, and that revenue is recognized upon completion of the installation. In many instances, products are sold in stand-alone arrangements. Services are sold separately through renewals of annual maintenance contracts. The Company has multiple element revenue arrangements in cases where certain elements of a sales arrangement are not delivered and accepted in one reporting period. To determine the relative fair value of each element in a revenue arrangement, the Company allocates arrangement consideration based on the selling price hierarchy. For substantially all of the arrangements with multiple deliverables pertaining to products and services, the Company uses vendor-specific objective evidence (“VSOE”) or third-party evidence (“TPE”) to allocate the selling price to each deliverable. The Company determines TPE based on historical prices charged for products and services when sold on a stand-alone basis. When the Company is unable to establish relative selling price using VSOE or TPE, the Company uses estimated selling price (“ESP”) in its allocation of arrangement consideration. The objective of ESP is to determine the price at which the Company would transact a sale if the product or service were sold on a stand-alone basis. ESP could potentially be used for new or customized products. The Company regularly reviews relative selling prices and maintains internal controls over the establishment and updates of these estimates. In a multiple element revenue arrangement, the Company defers revenue recognition associated with the relative fair value of each undelivered element until that element is delivered to the customer. To be considered a separate element, the product or service in question must represent a separate unit of accounting, which means that such product or service must fulfill the following criteria: (a) the delivered item(s) has value to the customer on a stand-alone basis; and (b) if the arrangement includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in the control of the Company. If the arrangement does not meet all the above criteria, the entire amount of the sales contract is deferred until all elements are accepted by the customer. Trade-in rights are occasionally granted to customers to trade in tools in connection with subsequent purchases. The Company estimates the value of the trade-in right and reduces the revenue recognized on the initial sale. This amount is recognized at the earlier of the exercise of the trade-in right or the expiration of the trade-in right. Spare parts revenue is recognized when the product has been shipped, risk of loss has passed to the customer and collection of the resulting receivable is probable. Service and maintenance contract revenue is recognized ratably over the term of the maintenance contract. Revenue from services performed in the absence of a maintenance contract, including consulting and training revenue, is recognized when the related services are performed and collectibility is reasonably assured. The Company sells stand-alone software that is subject to the software revenue recognition guidance. The Company periodically reviews selling prices to determine whether VSOE exists, and in situations where the Company is unable to establish VSOE for undelivered elements, such as post-contract service, revenue is recognized ratably over the term of the service contract. The Company also defers the fair value of non-standard warranty bundled with equipment sales as unearned revenue. Non-standard warranty includes services incremental to the standard 40 -hour per week coverage for 12 months. Non-standard warranty is recognized ratably as revenue when the applicable warranty term period commences. The deferred system profit balance equals the amount of deferred system revenue that was invoiced and due on shipment, less applicable product and warranty costs. Deferred system revenue represents the value of products that have been shipped and billed to customers which have not met the Company’s revenue recognition criteria. Deferred system profit does not include the profit associated with product shipments to certain customers in Japan, to whom title does not transfer until customer acceptance. Shipments to such customers in Japan are classified as inventory at cost until the time of acceptance. Research and Development Costs. Research and development costs are expensed as incurred. Strategic Development Agreements. Gross engineering, research and development expenses were partially offset by $1.9 million , $8.2 million and $12.4 million in external funding received under certain strategic development programs, primarily from government grants, in the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. Shipping and Handling Costs. Shipping and handling costs are included as a component of cost of sales. Accounting for Stock-Based Compensation Plans. The Company accounts for stock-based awards granted to employees for services based on the fair value of those awards. The fair value of stock-based awards is measured at the grant date and is recognized as expense over the employee’s requisite service period. The fair value for restricted stock units granted without “dividend equivalent” rights is determined using the closing price of the Company’s common stock on the grant date, adjusted to exclude the present value of dividends which are not accrued on the restricted stock units. The fair value for restricted stock units granted with “dividend equivalent” rights is determined using the closing price of the Company’s common stock on the grant date. The award holder is not entitled to received payments under dividend equivalent rights unless the associated restricted stock unit award vests (i.e., the award holder is entitled to receive credits, payable in cash or shares of the Company’s common stock, equal to the cash dividends that would have been received on the shares of common stock underlying the restricted stock units had the shares been issued and outstanding on the dividend record date, but such dividend equivalents are only paid subject to the recipient satisfying the vesting requirements of the underlying award). The fair value is determined using a Black-Scholes valuation model for purchase rights under the Employee Stock Purchase Plan. The Black-Scholes option-pricing model requires the input of assumptions, including the option’s expected term and the expected price volatility of the underlying stock. The expected stock price volatility assumption is based on the market-based historical implied volatility from traded options of the Company’s common stock. The Company has elected not to include the indirect tax effects of stock-based compensation deductions when calculating the windfall benefits and therefore recognizes the full effect of these deductions in the income statement in the period in which the taxable event occurs. Accounting for Cash-Based Long-Term Incentive Compensation. Cash-based long-term incentive (“Cash LTI”) awards issued to employees under the Company’s Cash LTI program vest in four equal installments, with 25% of the aggregate amount of the Cash LTI award vesting on each yearly anniversary of the grant date over a four -year period. In order to receive payments under a Cash LTI award, participants must remain employed by the Company as of the applicable award vesting date. Compensation expense related to the Cash LTI awards is recognized over the vesting term, which is adjusted for the impact of estimated forfeitures. Accounting for Non-qualified Deferred Compensation Plan. The Company has a non-qualified deferred compensation plan (known as “Executive Deferred Savings Plan”) under which certain executives and non-employee directors may defer a portion of their compensation. Participants are credited with returns based on their allocation of their account balances among measurement funds. The Company controls the investment of these funds, and the participants remain general creditors of the Company. The Company invests these funds in certain mutual funds and such investments are classified as trading securities on the consolidated balance sheets. Distributions from the Executive Deferred Savings Plan commence following a participant’s retirement or termination of employment or on a specified date allowed per the Executive Deferred Savings Plan provisions, except in cases where such distributions are required to be delayed in order to avoid a prohibited distribution under Internal Revenue Code Section 409A. Participants can generally elect the distributions to be paid in lump sum or quarterly cash payments over a scheduled period for up to 15 years and are allowed to make subsequent changes to their existing elections as permissible under the Executive Deferred Savings Plan provisions. The liability associated with the Executive Deferred Savings Plan is included as a component of other current liabilities on the consolidated balance sheet. Changes in the Executive Deferred Savings Plan liability is recorded in selling, general and administrative expense in the consolidated statements of operations. The changes in the liability included in selling, general and administrative expense were $10.4 million , $24.4 million and $14.2 million for the fiscal years ended June 30, 2015 , 2014 and 2013 respectively. The Company also has a deferred compensation asset that corresponds to the liability under the Executive Deferred Savings Plan and it is included as a component of other non-current assets on the consolidated balance sheet. Changes in the Executive Deferred Savings Plan assets are recorded as gains (losses), net in selling, general and administrative expense in the consolidated statements of operations. The amount of gains (losses), net included in selling, general and administrative expense were $10.4 million , $24.8 million and $14.1 million for the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. Advertising Expenses. Advertising costs are expensed as incurred. Income Taxes. The Company accounts for income taxes in accordance with the authoritative guidance, which requires that deferred tax assets and liabilities be recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. The guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that certain deferred tax asset will not be realized. The Company has determined that a valuation allowance is necessary against certain deferred tax assets, but it anticipates that its future taxable income will be sufficient to recover the remainder of its deferred tax assets. However, should there be a change in the Company’s ability to recover its deferred tax assets that are not subject to a valuation allowance, the Company could be required to record an additional valuation allowance against such deferred tax assets. This would result in an increase to the Company’s tax provision in the period in which the Company determines that the recovery is not probable. The Company applies a two-step approach, based on authoritative guidance, to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained in audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit and new audit activity. Any change in these factors could result in the recognition of a tax benefit or an additional charge to the tax provision. Earnings Per Share. Basic earnings per share (“EPS”) is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is calculated by using the weighted-average number of common shares outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the dilutive potential shares of common stock had been issued. The dilutive effect of outstanding options and restricted stock units is reflected in diluted earnings per share by application of the treasury stock method. The dilutive securities are excluded from the computation of diluted net loss per share when a net loss is recorded for the period as their effect would be anti-dilutive. Contingencies and Litigation. The Company is subject to the possibility of losses from various contingencies. Considerable judgment is necessary to estimate the probability and amount of any loss from such contingencies. An accrual is made when it is probable that a liability has been incurred or an asset has been impaired and the amount of loss can be reasonably estimated. The Company accrues a liability and recognizes as expense the estimated costs expected to be incurred over the next twelve months to defend or settle asserted and unasserted claims existing as of the balance sheet date. See Note 13, “Commitments and Contingencies” and Note 14, “Litigation and Other Legal Matters” for a detailed description. Reclassifications. Certain reclassifications have been made to prior year financial statements to conform to the current year presentation. The reclassifications had no effect on the Consolidated Statements of Operations, Comprehensive Income, Stockholder’s Equity and Cash Flows. Recent Accounting Pronouncements Recently Adopted In July 2013, the Financial Accounting Standards Board (“FASB”) issued an accounting standard update that provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. Under this accounting standard update, in most circumstances, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the Company’s financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss or a tax credit carryforward. This accounting standard update became effective for the Company’s interim period ended September 30, 2014, and the adoption did not have a material impact on the Company’s consolidated financial statements. In June 2014, the FASB issued an accounting standard update regarding stock-based compensation that clarifies t |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS The Company’s financial assets and liabilities are measured and recorded at fair value, except for certain equity investments in privately-held companies. These equity investments are generally accounted for under the cost method of accounting and are periodically assessed for other-than-temporary impairment when an event or circumstance indicates that an other-than-temporary decline in value may have occurred. The Company’s non-financial assets, such as goodwill, intangible assets, and land, property and equipment, are recorded at cost and are assessed for impairment when an event or circumstance indicates that an other-than-temporary decline in value may have occurred. Fair Value of Financial Instruments. KLA-Tencor has evaluated the estimated fair value of financial instruments using available market information and valuations as provided by third-party sources. The use of different market assumptions and/or estimation methodologies could have a significant effect on the estimated fair value amounts. The fair value of the Company’s cash equivalents, accounts receivable, accounts payable and other current liabilities approximate their carrying amounts due to the relatively short maturity of these items. Fair Value Hierarchy. The authoritative guidance for fair value measurements establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are described below: Level 1 Valuations based on quoted prices in active markets for identical assets or liabilities that the entity has the ability to access. Level 2 Valuations based on 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 data for substantially the full term of the assets or liabilities. Level 3 Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. The Company’s financial instruments were classified within Level 1 or Level 2 of the fair value hierarchy as of June 30, 2015 , because they were valued using quoted market prices, broker/dealer quotes or alternative pricing sources with reasonable levels of price transparency. As of June 30, 2015 , the types of instruments valued based on quoted market prices in active markets included money market funds, U.S. Treasury securities, certain sovereign securities and certain U.S. Government agency securities. Such instruments are generally classified within Level 1 of the fair value hierarchy. As of June 30, 2015 , the types of instruments valued based on other observable inputs included corporate debt securities, municipal securities and certain U.S. Government agency securities and sovereign securities. The market inputs used to value these instruments generally consist of market yields, reported trades and broker/dealer quotes. Such instruments are generally classified within Level 2 of the fair value hierarchy. The principal market in which the Company executes its foreign currency contracts is the institutional market in an over-the-counter environment with a relatively high level of price transparency. The market participants usually are large financial institutions. The Company’s foreign currency contracts’ valuation inputs are based on quoted prices and quoted pricing intervals from public data sources and do not involve management judgment. These contracts are typically classified within Level 2 of the fair value hierarchy. Financial assets (excluding cash held in operating accounts and time deposits) and liabilities measured at fair value on a recurring basis as of the date indicated below were presented on the Company’s Consolidated Balance Sheet as follows: As of June 30, 2015 (In thousands) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Assets Cash equivalents: U.S. Government agency securities $ 7,500 $ 7,500 $ — Corporate debt securities 13,099 — 13,099 Money market and other 611,385 611,385 — Marketable securities: U.S. Treasury securities 275,555 275,555 — U.S. Government agency securities 564,768 556,019 8,749 Municipal securities 31,816 — 31,816 Corporate debt securities 612,862 — 612,862 Sovereign securities 57,093 8,976 48,117 Total cash equivalents and marketable securities (1) 2,174,078 1,459,435 714,643 Other current assets: Derivative assets 3,064 — 3,064 Other non-current assets: Executive Deferred Savings Plan 165,655 91,203 74,452 Total financial assets (1) $ 2,342,797 $ 1,550,638 $ 792,159 Liabilities Other current liabilities: Derivative liabilities $ (3,106 ) $ — $ (3,106 ) Total financial liabilities $ (3,106 ) $ — $ (3,106 ) __________________ (1) Excludes cash of $183.1 million held in operating accounts and time deposits of $29.9 million as of June 30, 2015 . Financial assets (excluding cash held in operating accounts and time deposits) and liabilities measured at fair value on a recurring basis as of the date indicated below were presented on the Company’s Consolidated Balance Sheet as follows: As of June 30, 2014 (In thousands) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Assets Cash equivalents: U.S. Government agency securities $ 28,000 $ 8,000 $ 20,000 Municipal securities 2,891 — 2,891 Corporate debt securities 68,992 — 68,992 Money market and other 397,517 397,517 — Marketable securities: U.S. Treasury securities 384,400 365,401 18,999 U.S. Government agency securities 839,843 811,841 28,002 Municipal securities 93,325 — 93,325 Corporate debt securities 1,155,176 — 1,155,176 Sovereign securities 42,264 9,253 33,011 Total cash equivalents and marketable securities (1) 3,012,408 1,592,012 1,420,396 Other current assets: Derivative assets 666 — 666 Other non-current assets: Executive Deferred Savings Plan 159,995 105,311 54,684 Total financial assets (1) $ 3,173,069 $ 1,697,323 $ 1,475,746 Liabilities Other current liabilities: Derivative liabilities $ (898 ) $ — $ (898 ) Total financial liabilities $ (898 ) $ — $ (898 ) __________________ (1) Excludes cash of $106.7 million held in operating accounts and time deposits of $33.5 million as of June 30, 2014 . There were no transfers in and out of Level 1 and Level 2 fair value measurements during the fiscal year ended June 30, 2015 or 2014 . The Company did not have any assets or liabilities measured at fair value on a recurring basis within Level 3 fair value measurements as of June 30, 2015 or 2014 . |
Financial Statement Components
Financial Statement Components | 12 Months Ended |
Jun. 30, 2015 | |
Financial Statement Components [Abstract] | |
Financial Statement Components | FINANCIAL STATEMENT COMPONENTS Consolidated Balance Sheets As of June 30, (In thousands) 2015 2014 Accounts receivable, net: Accounts receivable, gross $ 607,157 $ 514,690 Allowance for doubtful accounts (21,663 ) (21,827 ) $ 585,494 $ 492,863 Inventories: Customer service parts $ 209,726 $ 203,194 Raw materials 194,218 221,612 Work-in-process 156,820 171,249 Finished goods 57,140 60,402 $ 617,904 $ 656,457 Other current assets: Prepaid expenses (1) $ 37,006 $ 34,743 Income tax related receivables 32,850 27,452 Other current assets 7,958 6,267 $ 77,814 $ 68,462 Land, property and equipment, net: Land $ 40,397 $ 41,848 Buildings and leasehold improvements 316,566 302,537 Machinery and equipment 510,642 491,167 Office furniture and fixtures 21,411 20,945 Construction-in-process 3,152 8,945 892,168 865,442 Less: accumulated depreciation and amortization (577,577 ) (535,179 ) $ 314,591 $ 330,263 Other non-current assets: Executive Deferred Savings Plan $ 165,655 $ 159,996 Deferred tax assets—long-term 78,648 75,138 Other non-current assets (1) 15,384 21,302 $ 259,687 $ 256,436 Other current liabilities: Warranty $ 36,413 $ 37,746 Executive Deferred Savings Plan 167,886 160,527 Compensation and benefits 196,682 203,990 Income taxes payable 15,582 15,283 Interest payable 19,395 8,769 Customer credits and advances 93,212 79,373 Other accrued expenses 132,244 79,402 $ 661,414 $ 585,090 Other non-current liabilities: Pension liabilities $ 55,696 $ 59,908 Income taxes payable 69,018 59,575 Other non-current liabilities 57,516 48,805 $ 182,230 $ 168,288 __________________ (1) Other current assets and other non-current assets balances as of June 30, 2014 on the consolidated balance sheet were adjusted to exclude the debt issuance costs as a result of early adoption of the accounting standards update regarding simplification of the presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. See Note 7, “Debt” for additional details. Accumulated Other Comprehensive Income (Loss) The components of accumulated other comprehensive income (loss) (“OCI”) as of the dates indicated below were as follows: (In thousands) Currency Translation Adjustments Unrealized Gains (Losses) on Available-for-Sale Securities Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Defined Benefit Plans Total Balance as of June 30, 2015 $ (29,925 ) $ 734 $ 4,553 $ (15,935 ) $ (40,573 ) Balance as of June 30, 2014 $ (17,271 ) $ 2,800 $ (12 ) $ (15,788 ) $ (30,271 ) The effects on net income of amounts reclassified from accumulated OCI to the Consolidated Statements of Operations for the indicated periods were as follows (in thousands): Location in the Consolidated Statements of Operations Twelve months ended Twelve months ended Accumulated OCI Components 2015 2014 Unrealized gains (losses) on cash flow hedges from foreign exchange and interest rate contracts Revenues $ 7,615 $ 3,851 Costs of revenues (1,503 ) 294 Interest expense 503 — Net gains reclassified from accumulated OCI $ 6,615 $ 4,145 Unrealized gains on available-for-sale securities Other expense (income), net $ 2,119 $ 2,084 The amounts reclassified out of accumulated OCI related to the Company’s defined pension plans, which were recognized as a component of net periodic cost for the fiscal years ended June 30, 2015 and 2014 were $1.3 million and $1.3 million , respectively. For additional details, refer to Note 11, “Employee Benefit Plans.” Consolidated Statements of Operations Year ended June 30, (In thousands) 2015 2014 2013 Other expense (income), net: Interest income $ (12,545 ) $ (13,555 ) $ (14,976 ) Foreign exchange losses, net 1,764 514 1,002 Net realized gains on sale of investments (2,119 ) (2,084 ) (2,287 ) Other 2,431 (1,078 ) 1,149 $ (10,469 ) $ (16,203 ) $ (15,112 ) |
Marketable Securities
Marketable Securities | 12 Months Ended |
Jun. 30, 2015 | |
Marketable Securities [Abstract] | |
Marketable Securities | MARKETABLE SECURITIES The amortized cost and fair value of marketable securities as of the dates indicated below were as follows: As of June 30, 2015 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury securities $ 274,965 $ 605 $ (15 ) $ 275,555 U.S. Government agency securities 571,843 551 (126 ) 572,268 Municipal securities 31,819 7 (10 ) 31,816 Corporate debt securities 625,965 511 (515 ) 625,961 Money market and other 611,385 — — 611,385 Sovereign securities 57,091 33 (31 ) 57,093 Subtotal 2,173,068 1,707 (697 ) 2,174,078 Add: Time deposits (1) 29,941 — — 29,941 Less: Cash equivalents 654,933 — — 654,933 Marketable securities $ 1,548,076 $ 1,707 $ (697 ) $ 1,549,086 As of June 30, 2014 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury securities $ 384,165 $ 287 $ (52 ) $ 384,400 U.S. Government agency securities 867,309 651 (117 ) 867,843 Municipal securities 96,198 93 (75 ) 96,216 Corporate debt securities 1,220,794 3,526 (152 ) 1,224,168 Money market and other 397,517 — — 397,517 Sovereign securities 42,227 46 (9 ) 42,264 Subtotal 3,008,210 4,603 (405 ) 3,012,408 Add: Time deposits (1) 33,509 — — 33,509 Less: Cash equivalents 524,149 — (8 ) 524,141 Marketable securities $ 2,517,570 $ 4,603 $ (397 ) $ 2,521,776 __________________ (1) Time deposits excluded from fair value measurements. KLA-Tencor’s investment portfolio consists of both corporate and government securities that have a maximum maturity of three years . The longer the duration of these securities, the more susceptible they are to changes in market interest rates and bond yields. As yields increase, those securities with a lower yield-at-cost show a mark-to-market unrealized loss. All unrealized losses are due to changes in market interest rates, bond yields and/or credit ratings. The Company believes that it has the ability to realize the full value of all of these investments upon maturity. The following table summarizes the fair value and gross unrealized losses of the Company’s investments that were in an unrealized loss position as of the date indicated below: As of June 30, 2015 (In thousands) Fair Value Gross Unrealized Losses (1) U.S. Treasury securities $ 34,508 $ (15 ) U.S. Government agency securities 133,933 (126 ) Municipal securities 9,776 (10 ) Corporate debt securities 286,355 (515 ) Sovereign securities 26,729 (31 ) Total $ 491,301 $ (697 ) __________________ (1) As of June 30, 2015 , the amount of total gross unrealized losses related to investments that had been in a continuous loss position for 12 months or more was immaterial. The contractual maturities of securities classified as available-for-sale, regardless of their classification on the Company’s Consolidated Balance Sheet, as of the date indicated below were as follows: As of June 30, 2015 (In thousands) Amortized Cost Fair Value Due within one year $ 496,916 $ 497,121 Due after one year through three years 1,051,160 1,051,965 $ 1,548,076 $ 1,549,086 Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Realized gains on available for sale securities for the fiscal years ended June 30, 2015 , 2014 and 2013 were $2.4 million , $2.2 million and $2.5 million , respectively. Realized losses on available for sale securities for the fiscal year ended June 30, 2015 , 2014 and 2013 were $0.3 million , $0.1 million and $0.2 million , respectively. |
Business Combination
Business Combination | 12 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Business Combination | BUSINESS COMBINATION On March 28, 2014 , the Company acquired certain assets and liabilities of a privately-held company that developed and sold software to mask manufacturers, semiconductor fabs and mask inspection and review equipment manufacturers, for a total purchase consideration of $18.0 million in cash. The following table represents the purchase price allocation and summarizes the aggregate fair values of the net assets acquired on the closing date of the acquisition: (In thousands) Purchase Price Allocation Intangibles $ 9,400 Goodwill 8,730 Liabilities assumed (130 ) Cash consideration paid $ 18,000 Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired. The $8.7 million of goodwill was assigned to the Defect Inspection reporting unit. |
Goodwill and Purchased Intangib
Goodwill and Purchased Intangible Assets | 12 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Purchased Intangible Assets | GOODWILL AND PURCHASED INTANGIBLE ASSETS Goodwill The following table presents goodwill balances and the movements during the fiscal years ended June 30, 2015 and 2014 : (In thousands) As of June 30, 2013 $ 326,635 Acquisition 8,730 Adjustments (10 ) As of June 30, 2014 335,355 Adjustments (92 ) As of June 30, 2015 $ 335,263 Goodwill represents the excess of the purchase price over the fair value of the net tangible and identifiable intangible assets acquired in prior business combinations. The Company has four reporting units: Defect Inspection, Metrology, Service and Other. As of June 30, 2015 , substantially all of the goodwill balance resided within the Defect Inspection reporting unit. The changes in the gross goodwill balance during the fiscal year ended June 30, 2015 resulted from foreign currency translation adjustments. The changes in the gross goodwill balance during the fiscal year ended June 30, 2014 resulted from the acquisition of certain assets and liabilities of a privately-held company and foreign currency translation adjustments. The Company performed a qualitative assessment of the goodwill by reporting unit as of November 30, 2014 and concluded that it was more likely than not that the fair value of each of the reporting units exceeded its carrying amount. In assessing the qualitative factors, the Company considered the impact of key factors including change in industry and competitive environment, market capitalization, stock price, earnings multiples, budgeted-to-actual revenue performance from prior year, gross margin and cash flow from operating activities. As such, it was not necessary to perform the two-step quantitative goodwill impairment test at that time. In addition, there have been no significant events or circumstances affecting the valuation of goodwill subsequent to the qualitative assessment performed in the second quarter of the fiscal year ended June 30, 2015 . The next annual assessment of the goodwill by reporting unit will be performed in the second quarter of the fiscal year ending June 30, 2016 . Purchased Intangible Assets The components of purchased intangible assets as of the dates indicated below were as follows: (In thousands) As of June 30, 2015 As of June 30, 2014 Category Range of Useful Lives Gross Carrying Amount Accumulated Amortization and Impairment Net Amount Gross Carrying Amount Accumulated Amortization and Impairment Net Amount Existing technology 4-7 years $ 141,659 $ 134,664 $ 6,995 $ 141,659 $ 126,567 $ 15,092 Patents 6-13 years 57,648 56,998 650 57,648 54,398 3,250 Trade name/Trademark 4-10 years 19,893 18,899 994 19,893 17,427 2,466 Customer relationships 6-7 years 54,980 51,724 3,256 54,980 48,915 6,065 Other 0-1 year 17,299 17,299 — 17,299 16,475 824 Total $ 291,479 $ 279,584 $ 11,895 $ 291,479 $ 263,782 $ 27,697 Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. For the fiscal years ended June 30, 2015 , 2014 and 2013 , amortization expense for other intangible assets was $15.8 million , $16.2 million and $20.8 million , respectively. Based on the intangible assets recorded as of June 30, 2015 , and assuming no subsequent additions to, or impairment of, the underlying assets, the remaining estimated annual amortization expense is expected to be as follows: Fiscal year ending June 30: Amortization (In thousands) 2016 $ 7,564 2017 2,806 2018 1,525 Total $ 11,895 |
Debt
Debt | 12 Months Ended |
Jun. 30, 2015 | |
Long-term Debt, Other Disclosures [Abstract] | |
Debt | DEBT The following table summarizes the debt of the Company as of June 30, 2015 and June 30, 2014 : As of June 30, 2015 As of June 30, 2014 Amount (in thousands) Effective Interest Rate Amount Effective Interest Rate Fixed-rate 6.900% Senior notes due on May 1, 2018 $ — $ 750,000 7.001 % Fixed-rate 2.375% Senior notes due on November 1, 2017 250,000 2.396 % — Fixed-rate 3.375% Senior notes due on November 1, 2019 250,000 3.377 % — Fixed-rate 4.125% Senior notes due on November 1, 2021 500,000 4.128 % — Fixed-rate 4.650% Senior notes due on November 1, 2024 (1) 1,250,000 4.682 % — Fixed-rate 5.650% Senior notes due on November 1, 2034 250,000 5.670 % — Term loans 711,250 — Total debt 3,211,250 750,000 Unamortized discount (3,723 ) (2,081 ) Unamortized debt issuance costs (2) (17,111 ) (2,818 ) Total debt $ 3,190,416 $ 745,101 Reported as: Current portion of long-term debt $ 16,981 $ — Long-term debt 3,173,435 745,101 Total debt $ 3,190,416 $ 745,101 __________________ (1) The effective interest rate disclosed above for this series of Senior Notes excludes the impact of the treasury rate lock hedge discussed below. The effective interest rate including the impact of the treasury rate lock hedge was 4.626% . (2) The Company early adopted the accounting standard update regarding simplification of the presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Accordingly, the Company applied the accounting standard update on a retrospective basis by reclassifying the presentation of the debt issuance costs totaling $2.8 million which was originally included in other current and other non-current assets against the long-term debt on the Consolidated Balance Sheet as of June 30, 2014 . The change in the classification of the debt issuance costs reduced total assets and total liabilities by $2.8 million as of June 30, 2014 . There is no impact to the Company’s Consolidated Statements of Operations, Comprehensive Income, Stockholder’s Equity and Cash Flows for the fiscal year ended June 30, 2014 . As of June 30, 2015 , future principal payments for long-term debt, including the current portion, are summarized as follows. Fiscal year ending June 30, Amount (In thousands) 2016 $ 17,500 2017 46,875 2018 315,625 2019 75,000 2020 756,250 Thereafter 2,000,000 Total payments $ 3,211,250 Debt Issuance - Senior Notes: In November 2014, the Company issued $2.50 billion aggregate principal amount of senior, unsecured long-term notes (collectively referred to as “Senior Notes”). The Company issued the Senior Notes as part of the leveraged recapitalization plan under which the proceeds from the Senior Notes in conjunction with the proceeds from the term loans (described below) and cash on hand were used (x) to fund a special cash dividend of $16.50 per share, aggregating to approximately $2.76 billion , (y) to redeem $750 million of 2018 Senior Notes, including associated redemption premiums, accrued interest and other fees and expenses and (z) for other general corporate purposes, including repurchases of shares pursuant to the Company’s stock repurchase program. The interest rate specified for each series of the Senior Notes will be subject to adjustments from time to time if Moody’s Investor Service, Inc. (“Moody’s”) or Standard & Poor’s Ratings Services (“S&P”) or, under certain circumstances, a substitute rating agency selected by us as a replacement for Moody’s or S&P, as the case may be (a “Substitute Rating Agency”), downgrades (or subsequently upgrades) its rating assigned to the respective series of Senior Notes such that the adjusted rating is below investment grade. If the adjusted rating of any series of Senior Notes from Moody’s (or, if applicable, any Substitute Rating Agency) is decreased to Ba1, Ba2, Ba3 or B1 or below, the stated interest rate on such series of Senior Notes as noted above will increase by 25 bps , 50 bps , 75 bps or 100 bps , respectively (“bps” refers to Basis Points and 1% is equal to 100 bps). If the rating of any series of Senior Notes from S&P (or, if applicable, any Substitute Rating Agency) with respect to such series of Senior Notes is decreased to BB+, BB, BB- or B+ or below, the stated interest rate on such series of Senior Notes as noted above will increase by 25 bps , 50 bps , 75 bps or 100 bps , respectively. The interest rates on any series of Senior Notes will permanently cease to be subject to any adjustment (notwithstanding any subsequent decrease in the ratings by any of Moody’s, S&P and, if applicable, any Substitute Rating Agency) if such series of Senior Notes becomes rated “Baa1” (or its equivalent) or higher by Moody’s (or, if applicable, any Substitute Rating Agency) and “BBB+” (or its equivalent) or higher by S&P (or, if applicable, any Substitute Rating Agency), or one of those ratings if rated by only one of Moody’s, S&P and, if applicable, any Substitute Rating Agency, in each case with a stable or positive outlook. In October 2014, the Company entered into a series of forward contracts to lock the 10-year treasury rate (“benchmark rate”) on a portion of the Senior Notes with a notional amount of $1.00 billion in aggregate. For additional details, refer to Note 16, “Derivative Instruments and Hedging Activities.” The original discount on the Senior Notes amounted to $4.0 million and is being amortized over the life of the debt. Interest is payable semi-annually on May 1 and November 1 of each year. The debt indenture (the “Indenture”) includes covenants that limit the Company’s ability to grant liens on its facilities and enter into sale and leaseback transactions, subject to certain allowances under which certain sale and leaseback transactions are not restricted. As of June 30, 2015 , the Company was in compliance with all of its covenants under the Indenture associated with the Senior Notes. In certain circumstances involving a change of control followed by a downgrade of the rating of a series of Senior Notes by at least two of Moody’s, S&P and Fitch Inc., unless the Company has exercised its right to redeem the Senior Notes of such series, the Company will be required to make an offer to repurchase all or, at the holder’s option, any part, of each holder’s Senior Notes of that series pursuant to the offer described below (the “Change of Control Offer”). In the Change of Control Offer, the Company will be required to offer payment in cash equal to 101% of the aggregate principal amount of Senior Notes repurchased plus accrued and unpaid interest, if any, on the Senior Notes repurchased, up to, but not including, the date of repurchase. Based on the trading prices of the Senior Notes on the applicable dates, the fair value of the Senior Notes as of June 30, 2015 and June 30, 2014 was $2.52 billion and $893.7 million , respectively. While the Senior Notes are recorded at cost, the fair value of the long-term debt was determined based on quoted prices in markets that are not active; accordingly, the long-term debt is categorized as Level 2 for purposes of the fair value measurement hierarchy. Debt Issuance - Credit Facility (Term Loans and Unfunded Revolving Credit Facility): In November 2014, the Company entered into $750 million of five -year senior unsecured prepayable term loans and a $500 million unfunded revolving credit facility (collectively, the “Credit Facility”) under the Credit Agreement (the “Credit Agreement”). The interest under the Credit Facility will be payable on the borrowed amounts at the London Interbank Offered Rate (“LIBOR”) plus a spread, which is currently 125 bps , and this spread is subject to adjustment in conjunction with the Company’s credit rating downgrades or upgrades. The spread ranges from 100 bps to 175 bps based on the then effective credit rating. The Company is also obligated to pay an annual commitment fee of 15 bps on the daily undrawn balance of the revolving credit facility, which is also subject to an adjustment in conjunction with the Company’s credit rating downgrades or upgrades by Moody’s and S&P. The annual commitment fee ranges from 10 bps to 25 bps on the daily undrawn balance of the revolving credit facility, depending upon the then effective credit rating. Principal payments with respect to the term loans will be made on the last day of each calendar quarter, and any unpaid principal balance of the term loans, including accrued interest, shall be payable on November 14, 2019 (the “Maturity Date”). The Company may prepay the term loans and unfunded revolving credit facility at any time without a prepayment penalty. During the fourth quarter of fiscal year ended June 30, 2015 , the Company prepaid additional principal of $20.0 million in addition to the scheduled quarterly payments for the term loans. Future principal payments for the Company’s term loans (without giving effect for any prepayments made) as of June 30, 2015 , are as follows: Fiscal Quarters Ending Quarterly Payment (in thousands) June 30, 2015 through December 31, 2016 $ 9,375 March 31, 2017 through December 31, 2017 $ 14,063 March 31, 2018 through September 30, 2019 $ 18,750 December 31, 2019 $ 487,500 The Credit Facility requires the Company to maintain an interest expense coverage ratio as described in the Credit Agreement, on a quarterly basis, covering the trailing four consecutive fiscal quarters of no less than 3.50 to 1.00. In addition, the Company is required to maintain the maximum leverage ratio as described in the Credit Agreement, on a quarterly basis, covering the trailing four consecutive fiscal quarters for the fiscal quarters as described below. Fiscal Quarters Ending Maximum Leverage Ratio June 30, 2015 4.25:1.00 September 30, 2015 and December 31, 2015 4.00:1.00 March 31, 2016 through September 30, 2016 3.75:1.00 December 31, 2016 and March 31, 2017 3.50:1.00 Thereafter 3.00:1.00 The Company was in compliance with the financial covenants under the Credit Agreement as of June 30, 2015 and had no outstanding borrowings under the unfunded revolving credit facility. Debt Redemption: In December 2014, the Company redeemed the $750 million aggregate principal amount of the 2018 Senior Notes. The redemption resulted in a pre-tax net loss on extinguishment of debt of $131.7 million for the three months ended December 31, 2014 after an offset of a $1.2 million gain upon the termination of the non-designated forward contract entered by the Company in November 2014. The objective of entering into the non-designated forward contract was to lock the treasury rate used to determine the redemption amount of the 2018 Senior Notes. The notional amount of the non-designated forward contract was $750 million . Refer to Note 16, “Derivative Instruments and Hedging Activities.” |
Equity and Long-Term Incentive
Equity and Long-Term Incentive Compensation Plans | 12 Months Ended |
Jun. 30, 2015 | |
Share-based Compensation [Abstract] | |
Equity and Long-Term Incentive Compensation Plans | EQUITY AND LONG-TERM INCENTIVE COMPENSATION PLANS Equity Incentive Program As of June 30, 2015 , the Company had two plans under which the Company was able to issue equity incentive awards, such as restricted stock units and stock options, to its employees, consultants and members of its Board of Directors: the 2004 Equity Incentive Plan (the “2004 Plan”) and the 1998 Director Plan (the “Outside Director Plan”). 2004 Plan: The 2004 Plan provides for the grant of options to purchase shares of the Company’s common stock, stock appreciation rights, restricted stock units, performance shares, performance units and deferred stock units to the Company’s employees, consultants and members of its Board of Directors. As of June 30, 2015 , 6.1 million shares were available for issuance under the 2004 Plan. Any 2004 Plan awards of restricted stock units, performance shares, performance units or deferred stock units with a per share or unit purchase price lower than 100% of fair market value on the grant date are counted against the total number of shares issuable under the 2004 Plan as follows, based on the grant date of the applicable award: (a) for any such awards granted before November 6, 2013, the awards counted against the 2004 Plan share reserve as 1.8 shares for every one share subject thereto; and (b) for any such awards granted on or after November 6, 2013, the awards count against the 2004 Plan share reserve as 2.0 shares for every one share subject thereto. In addition, in November 2013, the Company’s stockholders also approved amendments to the 2004 Plan that included, among other things, giving the plan administrator the ability to grant “dividend equivalent” rights in connection with awards of restricted stock units, performance shares, performance units and deferred stock units before they are fully vested. It allows the plan administrator, at its discretion, to grant a right to receive dividends on the aforementioned awards which may be settled in cash or Company stock at the discretion of the plan administrator subject to meeting the vesting requirement of the underlying awards. Outside Director Plan The Outside Director Plan only permits the issuance of stock options to the non-employee members of the Board of Directors. As of June 30, 2015 , 1.7 million shares were available for grant under the Outside Director Plan. Equity Incentive Plans - General Information The following table summarizes the combined activity under the Company’s equity incentive plans for the indicated periods: (In thousands) Available For Grant Balances as of June 30, 2012 7,969 Restricted stock units granted (1)(3) (1,899 ) Restricted stock units canceled (1) 466 Options canceled/expired/forfeited 207 Plan shares expired (2) (47 ) Balances as of June 30, 2013 6,696 Plan shares increased 2,900 Restricted stock units granted (1)(3) (1,268 ) Restricted stock units canceled (1) 468 Options canceled/expired/forfeited 59 Plan shares expired (2) (51 ) Balances as of June 30, 2014 8,804 Restricted stock units granted (1)(3) (1,191 ) Restricted stock units canceled (1) 196 Options granted/canceled/expired/forfeited 11 Plan shares expired (2) (10 ) Balances as of June 30, 2015 (4) 7,810 __________________ (1) The number of restricted stock units provided in this row reflects the application of the award multiplier as described above ( 1.8 x or 2.0 x depending on the grant date of the applicable award). (2) Represents the portion of shares listed as “Options canceled/expired/forfeited” above that were issued under the Company’s equity incentive plans other than the 2004 Plan and the Outside Director Plan. Because the Company is only currently authorized to issue equity awards under the 2004 Plan and the Outside Director Plan, any equity awards that are canceled, expired or forfeited under any other Company equity incentive plan do not result in additional shares being available to the Company for future grant. (3) Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015 , it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units granted during such fiscal year, reported at the maximum possible number of shares that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum levels and all applicable service-based criteria are fully satisfied (i.e., 0.6 million shares for the fiscal year ended June 30, 2013, 0.6 million shares for the fiscal year ended June 30, 2014 and 0.6 million shares for the fiscal year ended June 30, 2015 , which, in each case reflects the application of the 1.8 x or 2.0 x multiplier described above). The Company has granted only restricted stock units under its equity incentive program since October 2007, except the number of shares subject to outstanding options under the 2004 Plan was adjusted during the three months ended December 31, 2014 due to a proportionate and equitable adjustment under the 2004 Plan provisions as discussed below. For the preceding several years until October 31, 2007, stock options were granted at the market price of the Company’s common stock on the date of grant generally with vesting period terms ranging from one to five years . Restricted stock units may be granted with varying criteria such as service-based and/or performance-based vesting. (4) During the fiscal year ended June 30, 2015 , the Company adjusted the number of shares subject to outstanding options under the 2004 Plan by an aggregate of 4,245 shares pursuant to a proportionate and equitable adjustment for the effect of the special cash dividend, as required by the 2004 Plan. The total number of outstanding options under the 2004 Plan as well as the associated exercise prices were adjusted to ensure the aggregate intrinsic value remained the same after considering the effect of the special cash dividend. As the adjustment was required by the 2004 Plan, under the authoritative guidance, the adjustment to the outstanding awards did not result in any incremental compensation expense. Additionally, the adjustment did not have an impact on the shares available for future issuance under the 2004 Plan. The fair value of stock-based awards is measured at the grant date and is recognized as an expense over the employee’s requisite service period. For restricted stock units granted without “dividend equivalent” rights, fair value is calculated using the closing price of the Company’s common stock on the grant date, adjusted to exclude the present value of dividends which are not accrued on those restricted stock units. In November 2013, the Company’s stockholders approved amendments to the 2004 Plan that included, among other things, giving the plan administrator the ability to grant “dividend equivalent” rights in connection with awards of restricted stock units, performance shares, performance units and deferred stock units before they are fully vested as discussed above. The fair value for restricted stock units granted with “dividend equivalent” rights is determined using the closing price of the Company’s common stock on the grant date. As of June 30, 2015 , the Company accrued $42.0 million of dividends payable, substantially all of which is related to the special cash dividend for the unvested restricted stock units outstanding as of the dividend record date as well as restricted stock units granted with dividend equivalent rights during the fiscal year ended June 30, 2015 , which entitle the holders of such equity awards to the same dividend value per share as holders of common stock subject to meeting the vesting requirements of the underlying equity awards. The fair value for purchase rights under the Company’s Employee Stock Purchase Plan is determined using a Black-Scholes valuation model. The following table shows pre-tax stock-based compensation expense for the indicated periods: Year ended June 30, (In thousands) 2015 2014 2013 Stock-based compensation expense by: Costs of revenues $ 7,242 $ 9,101 $ 11,433 Engineering, research and development 12,259 16,397 19,346 Selling, general and administrative 35,801 35,442 39,305 Total stock-based compensation expense $ 55,302 $ 60,940 $ 70,084 The following table shows stock-based compensation capitalized as inventory as of the dates indicated below: (In thousands) As of June 30, 2015 2014 Inventory $ 3,242 $ 8,278 Stock Options The following table summarizes the activity and weighted-average exercise price for stock options under all plans during the fiscal year ended June 30, 2015 : Stock Options Shares (In thousands) Weighted-Average Exercise Price Outstanding stock options as of June 30, 2014 141 $ 40.70 Granted 4 $ 32.11 Exercised (134 ) $ 39.32 Canceled/expired/forfeited (11 ) $ 39.97 Outstanding stock options as of June 30, 2015 (all outstanding and all vested and exercisable) — $ — The Company has not issued any stock options since October 2007. However, during the three months ended December 31, 2014 , the Company adjusted the number of shares subject to outstanding options under the 2004 Plan by an aggregate of 4,245 shares pursuant to a proportionate and equitable adjustment for the effect of the special cash dividend, as required by the 2004 Plan. The total number of outstanding options under the 2004 Plan as well as the associated exercise prices were adjusted to ensure the aggregate intrinsic value remained the same after considering the effect of the special cash dividend. As the adjustment was required by the 2004 Plan, the adjustment to the outstanding awards did not result in any incremental compensation expense due to modification of such awards, under the authoritative guidance. Additionally, the adjustment did not have an impact on the shares available for future issuance under the 2004 Plan. The following table shows the total intrinsic value of options exercised, total cash received from employees and non-employee Board members as a result of stock option exercises and tax benefits realized by the Company in connection with these stock option exercises for the indicated periods: (In thousands) Year ended June 30, 2015 2014 2013 Total intrinsic value of options exercised $ 4,549 $ 18,022 $ 15,884 Total cash received from employees and non-employee Board members as a result of stock option exercises $ 5,892 $ 72,700 $ 89,935 Tax benefits realized by the Company in connection with these exercises $ 1,989 $ 5,708 $ 5,223 The Company generally settles employee stock option exercises with newly issued common shares, except in certain tax jurisdictions where settling such exercises with treasury shares provides the Company or one of its subsidiaries with a tax benefit. Restricted Stock Units The following table shows the applicable number of restricted stock units and weighted-average grant date fair value for restricted stock units granted, vested and released, withheld for taxes, and forfeited during the fiscal year ended June 30, 2015 and restricted stock units outstanding as of June 30, 2015 and 2014 : Restricted Stock Units Shares (In thousands) (1) Weighted-Average Grant Date Fair Value Outstanding restricted stock units as of June 30, 2014 (2) 3,356 $ 38.95 Granted (2) 596 $ 74.48 Vested and released (765 ) $ 32.50 Withheld for taxes (405 ) $ 32.50 Forfeited (108 ) $ 38.90 Outstanding restricted stock units as of June 30, 2015 (2) 2,674 $ 49.36 __________________ (1) Share numbers reflect actual shares subject to awarded restricted stock units. As described above, under the terms of the 2004 Plan, the number of shares subject to each award reflected in this number is multiplied by either 1.8 x or 2.0 x (depending on the grant date of the award) to calculate the impact of the award on the share reserve under the 2004 Plan. (2) Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015 , it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units, reported at the maximum possible number of shares (i.e., 0.3 million shares for the fiscal year ended June 30, 2013, 0.3 million shares for the fiscal year ended June 30, 2014 and 0.3 million shares for the fiscal year ended June 30, 2015 ) that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum and all applicable service-based criteria are fully satisfied . The restricted stock units granted by the Company since the beginning of the fiscal year ended June 30, 2013 generally vest (a) with respect to awards with only service-based vesting criteria, in four equal installments on the first, second, third and fourth anniversaries of the grant date and (b) with respect to awards with both performance-based and service-based vesting criteria, in two equal installments on the third and fourth anniversaries of the grant date, in each case subject to the recipient remaining employed by the Company as of the applicable vesting date. The restricted stock units granted by the Company from the beginning of the fiscal year ended June 30, 2007 through the fiscal year ended June 30, 2012 generally vest in two equal installments on the second and fourth anniversaries of the grant date, subject to the recipient remaining employed by the Company as of the applicable vesting date. The following table shows the weighted-average grant date fair value per unit for the restricted stock units granted and tax benefits realized by the Company in connection with vested and released restricted stock units for the indicated periods: (In thousands, except for weighted-average grant date fair value) Year ended June 30, 2015 2014 2013 Weighted-average grant date fair value per unit $ 74.48 $ 53.28 $ 47.71 Tax benefits realized by the Company in connection with vested and released restricted stock units $ 26,250 $ 44,298 $ 29,204 As of June 30, 2015 , the unrecognized stock-based compensation expense balance related to restricted stock units was $60.3 million , excluding the impact of estimated forfeitures, and will be recognized over a weighted-average remaining contractual term and an estimated weighted-average amortization period of 1.0 year . The intrinsic value of outstanding restricted stock units as of June 30, 2015 was $150.3 million . Cash-Based Long-Term Incentive Compensation Starting in the fiscal year ended June 30, 2013, the Company adopted a cash-based long-term incentive (“Cash LTI”) program for many of its employees as part of the Company’s employee compensation program. During the fiscal year ended June 30, 2015 , the Company approved Cash LTI awards of $67.7 million under the Company’s Cash Long-Term Incentive Plan (“Cash LTI Plan”). Cash LTI awards issued to employees under the Cash LTI Plan will vest in four equal installments, with 25% of the aggregate amount of the Cash LTI award vesting on each yearly anniversary of the grant date over a four -year period. In order to receive payments under a Cash LTI award, participants must remain employed by the Company as of the applicable award vesting date. Executives and non-employee Board members are not participating in this program. During the fiscal years ended June 30, 2015 and 2014 , the Company recognized $39.6 million and $26.2 million , respectively, in compensation expense under the Cash LTI Plan. As of June 30, 2015 , the unrecognized compensation balance (excluding the impact of estimated forfeitures) related to the Cash LTI Plan was $94.5 million . Employee Stock Purchase Plan KLA-Tencor’s Employee Stock Purchase Plan (“ESPP”) provides that eligible employees may contribute up to 10% of their eligible earnings toward the semi-annual purchase of KLA-Tencor’s common stock. The ESPP is qualified under Section 423 of the Internal Revenue Code. The employee’s purchase price is derived from a formula based on the closing price of the common stock on the first day of the offering period versus the closing price on the date of purchase (or, if not a trading day, on the immediately preceding trading day). The offering period (or length of the look-back period) under the ESPP has a duration of six months , and the purchase price with respect to each offering period beginning on or after such date is, until otherwise amended, equal to 85% of the lesser of (i) the fair market value of the Company’s common stock at the commencement of the applicable six-month offering period or (ii) the fair market value of the Company’s common stock on the purchase date. The Company estimates the fair value of purchase rights under the ESPP using a Black-Scholes valuation model. The fair value of each purchase right under the ESPP was estimated on the date of grant using the Black-Scholes option valuation model and the straight-line attribution approach with the following weighted-average assumptions: Year ended June 30, 2015 2014 2013 Stock purchase plan: Expected stock price volatility 24.5 % 27.5 % 28.8 % Risk-free interest rate 0.1 % 0.1 % 0.1 % Dividend yield 2.8 % 2.9 % 3.2 % Expected life (in years) 0.50 0.50 0.50 The following table shows total cash received from employees for the issuance of shares under the ESPP, the number of shares purchased by employees through the ESPP, the tax benefits realized by the Company in connection with the disqualifying dispositions of shares purchased under the ESPP and the weighted-average fair value per share for the indicated periods: (In thousands, except for weighted-average fair value per share) Year ended June 30, 2015 2014 2013 Total cash received from employees for the issuance of shares under the ESPP $ 41,116 $ 39,675 $ 36,186 Number of shares purchased by employees through the ESPP 759 796 877 Tax benefits realized by the Company in connection with the disqualifying dispositions of shares purchased under the ESPP $ 1,741 $ 2,221 $ 1,452 Weighted-average fair value per share based on Black-Scholes model $ 14.55 $ 12.31 $ 10.46 The ESPP shares are replenished annually on the first day of each fiscal year by virtue of an evergreen provision. The provision allows for share replenishment equal to the lesser of 2.0 million shares or the number of shares which KLA-Tencor estimates will be required to be issued under the ESPP during the forthcoming fiscal year. In August 2014, the Company added 2.0 million additional shares to the ESPP pursuant to the plan’s share replenishment provision with respect to the fiscal year ended June 30, 2015 . As of June 30, 2015 , a total of 2.1 million shares were reserved and available for issuance under the ESPP. Quarterly cash dividends On May 7, 2015, the Company’s Board of Directors declared a regular quarterly cash dividend of $0.50 per share on the outstanding shares of the Company’s common stock, which was paid on June 1, 2015 to the stockholders of record as of the close of business on May 18, 2015. Under the authoritative guidance, a dividend when declared is recognized as a reduction of retained earnings, to the extent available, with any excess recognized as a reduction of additional paid-in-capital. The total amount of regular quarterly cash dividends paid by the Company during the fiscal years ended June 30, 2015 and 2014 was $324.8 million and $298.9 million , respectively. The amount of accrued dividends for quarterly cash dividends for unvested restricted stock units with dividend equivalent rights was $0.9 million as of June 30, 2015 . The Company had no accrued dividends for the quarterly cash dividends in the fiscal year ended June 30, 2014 . On July 14, 2015 , the Company announced that its Board of Directors had authorized a further increase in the level of the Company’s quarterly cash dividend from $0.50 to $0.52 per share. Refer to Note 19, “Subsequent Events” for additional information on dividend increase announced subsequent to June 30, 2015. Special cash dividend On November 19, 2014, the Company’s Board of Directors declared a special cash dividend of $16.50 per share, which was paid on December 9, 2014 to the stockholders of record as of the close of business on December 1, 2014. Additionally, in connection with the special cash dividend, the Company’s Board of Directors and the Compensation Committee of the Board of Directors approved a proportionate and equitable adjustment to outstanding equity awards (restricted stock units and stock options), as required under the 2004 Plan, subject to the vesting requirements of the underlying awards. As the adjustment was required by the 2004 Plan, the adjustment to the outstanding awards did not result in any incremental compensation expense due to modification of such awards, under the authoritative guidance. Under the authoritative guidance, the dividend when declared is recognized as a reduction of retained earnings, to the extent available, with any excess recognized as a reduction of additional paid-in-capital. The special cash dividend reduced the retained earnings by $2.1 billion as of the special cash dividend declaration date, reducing the retained earnings amount to zero and the excess amount of the special cash dividend of $646.5 million was charged against additional paid-in capital. The declaration and payment of the special cash dividend are part of the Company’s leveraged recapitalization transaction under which the special cash dividend was financed through a combination of existing cash and proceeds from the debt financing disclosed in Note 7, “Debt” that was completed during the three months ended December 31, 2014 . The total amount of the special cash dividend accrued by the Company during the three months ended December 31, 2014 was approximately $2.76 billion , substantially all of which was paid out during the three months ended December 31, 2014 . As of June 30, 2015 , the Company accrued a total of $41.1 million of dividends payable for the special cash dividend with respect to outstanding unvested restricted stock units, which will be paid when such underlying unvested restricted stock units vest. Other than the special cash dividend declared during the three months ended December 31, 2014 , the Company historically has not declared any special cash dividends. |
Stock Repurchase Program
Stock Repurchase Program | 12 Months Ended |
Jun. 30, 2015 | |
Stock Repurchase Program [Abstract] | |
Stock Repurchase Program | STOCK REPURCHASE PROGRAM The Company’s Board of Directors has authorized a program for the Company to repurchase shares of the Company’s common stock. The intent of this program is to offset the dilution from KLA-Tencor’s equity incentive plans and employee stock purchase plan, as well as to return excess cash to the Company’s stockholders. Subject to market conditions, applicable legal requirements and other factors, the repurchases will be made from time to time in the open market in compliance with applicable securities laws, including the Securities Exchange Act of 1934 and the rules promulgated thereunder such as Rule 10b-18. On July 7, 2014 , the Company’s Board of Directors authorized KLA-Tencor to repurchase up to 13.0 million additional shares of the Company’s common stock. On October 23, 2014 , as part of the leveraged recapitalization transaction announcement, the Board of Directors authorized an increase to the existing stock repurchase program of 3.6 million additional shares of the Company’s common stock. As of June 30, 2015 , an aggregate of approximately 9.4 million shares were available for repurchase under the Company’s repurchase program. Share repurchases for the indicated periods (based on the trade date of the applicable repurchase) were as follows: (In thousands) Year ended June 30, 2015 2014 Number of shares of common stock repurchased 9,255 3,835 Total cost of repurchases $ 608,856 $ 240,843 As of June 30, 2015 , the Company had repurchased 105,542 shares for $6.0 million , which repurchases had not settled prior to June 30, 2015 and were recorded as a component of other current liabilities. |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | NET INCOME PER SHARE Basic net income per share is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted net income per share is calculated by using the weighted-average number of common shares outstanding during the period, increased to include the number of additional shares of common stock that would have been outstanding if the shares of common stock underlying the Company’s outstanding dilutive stock options and restricted stock units had been issued. The dilutive effect of outstanding options and restricted stock units is reflected in diluted net income per share by application of the treasury stock method. Under the treasury stock method, the amount the employee must pay for exercising stock options, the amount of compensation cost for future service that the Company has not yet recognized, and the amount of tax benefits that is to be recorded in additional paid-in capital when the award becomes deductible are assumed to be used to repurchase shares. The following table sets forth the computation of basic and diluted net income per share: (In thousands, except per share amounts) Year ended June 30, 2015 2014 2013 Numerator: Net income $ 366,158 $ 582,755 $ 543,149 Denominator: Weighted-average shares-basic, excluding unvested restricted stock units 162,282 166,016 166,089 Effect of dilutive options and restricted stock units 1,419 2,102 3,171 Weighted-average shares-diluted 163,701 168,118 169,260 Basic net income per share $ 2.26 $ 3.51 $ 3.27 Diluted net income per share $ 2.24 $ 3.47 $ 3.21 Anti-dilutive securities excluded from the computation of diluted net income per share 36 — 1,366 |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Jun. 30, 2015 | |
Postemployment Benefits [Abstract] | |
Employee Benefit Plans | EMPLOYEE BENEFIT PLANS KLA-Tencor has a profit sharing program for eligible employees, which distributes, on a quarterly basis, a percentage of the Company’s pre-tax profits. In addition, the Company has an employee savings plan that qualifies as a deferred salary arrangement under Section 401(k) of the Internal Revenue Code. Since April 1, 2011, the employer match amount was 50% of the first $8,000 of an eligible employee’s contribution (i.e., a maximum of $4,000 ) during each fiscal year. The total expenses under the profit sharing and 401(k) programs aggregated $14.2 million , $15.4 million and $13.1 million in the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. The Company has no defined benefit plans in the United States. In addition to the profit sharing plan and the United States 401(k), several of the Company’s foreign subsidiaries have retirement plans for their full-time employees, several of which are defined benefit plans. Consistent with the requirements of local law, the Company deposits funds for certain of these plans with insurance companies, with third-party trustees or into government-managed accounts and/or accrues for the unfunded portion of the obligation. The assumptions used in calculating the obligation for the foreign plans depend on the local economic environment. The Company applies authoritative guidance that requires an employer to recognize the funded status of each of its defined pension and post-retirement benefit plans as a net asset or liability on its balance sheets. Additionally, the authoritative guidance requires an employer to measure the funded status of each of its plans as of the date of its year-end statement of financial position. The benefit obligations and related assets under the Company’s plans have been measured as of June 30, 2015 and 2014 . Summary data relating to the Company’s foreign defined benefit pension plans, including key weighted-average assumptions used, is provided in the following tables: Year ended June 30, (In thousands) 2015 2014 Change in projected benefit obligation: Projected benefit obligation as of the beginning of the fiscal year $ 77,035 $ 71,276 Service cost 3,905 4,054 Interest cost 1,562 1,401 Contributions by plan participants 81 102 Actuarial loss 3,702 1,927 Benefit payments (3,982 ) (1,910 ) Foreign currency exchange rate changes and others, net (6,375 ) 185 Projected benefit obligation as of the end of the fiscal year $ 75,928 $ 77,035 Year ended June 30, (In thousands) 2015 2014 Change in fair value of plan assets: Fair value of plan assets as of the beginning of the fiscal year $ 15,163 $ 13,317 Actual return on plan assets 334 274 Employer contributions 3,568 3,229 Benefit and expense payments (3,982 ) (1,910 ) Foreign currency exchange rate changes and others, net 1,955 253 Fair value of plan assets as of the end of the fiscal year $ 17,038 $ 15,163 As of June 30, (In thousands) 2015 2014 Underfunded status $ 58,890 $ 61,872 As of June 30, (In thousands) 2015 2014 Plans with accumulated benefit obligations in excess of plan assets: Accumulated benefit obligation $ 46,419 $ 47,122 Projected benefit obligation $ 75,928 $ 77,035 Plan assets at fair value $ 17,038 $ 15,163 Year ended June 30, 2015 2014 2013 Weighted-average assumptions: Discount rate 1.3%-2.0% 1.5%-3.5% 1.5%-3.5% Expected rate of return on assets 1.8%-2.5% 1.8%-3.8% 1.8%-4.0% Rate of compensation increases 3.0%-5.5% 3.0%-5.5% 3.0%-5.0% The assumptions for expected rate of return on assets were developed by considering the historical returns and expectations of future returns relevant to the country in which each plan is in effect and the investments applicable to the corresponding plan. The discount rate for each plan was derived by reference to appropriate benchmark yields on high quality corporate bonds, allowing for the approximate duration of both plan obligations and the relevant benchmark index. The following table presents losses recognized in accumulated other comprehensive income (loss) before tax related to the Company’s foreign defined benefit pension plans: Year ended June 30, (In thousands) 2015 2014 Unrecognized transition obligation $ 515 $ 772 Unrecognized prior service cost 180 225 Unrealized net loss 24,119 23,645 Amount of losses recognized $ 24,814 $ 24,642 Losses in accumulated other comprehensive income (loss) related to the Company’s foreign defined benefit pension plans expected to be recognized as components of net periodic benefit cost over the fiscal year ending June 30, 2016 are as follows: (In thousands) Year ending June 30, 2016 Unrecognized transition obligation $ 255 Unrecognized prior service cost 42 Unrealized net loss 824 Amount of losses expected to be recognized $ 1,121 The components of the Company’s net periodic cost relating to its foreign subsidiaries’ defined pension plans are as follows: Year ended June 30, (In thousands) 2015 2014 2013 Components of net periodic pension cost: Service cost $ 3,905 $ 4,054 $ 3,399 Interest cost 1,562 1,401 1,320 Return on plan assets (450 ) (321 ) (315 ) Amortization of transitional obligation 259 262 372 Amortization of prior service cost 46 52 58 Amortization of net loss 1,014 1,021 633 Adjustment (177 ) — (1,436 ) Net periodic pension cost $ 6,159 $ 6,469 $ 4,031 Fair Value of Plan Assets Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The three levels of inputs used to measure fair value of plan assets are described in Note 2, “Fair Value Measurements.” The foreign plans’ investments are managed by third-party trustees consistent with the regulations or market practice of the country where the assets are invested. The Company is not actively involved in the investment strategy, nor does it have control over the target allocation of these investments. These investments made up 100% of total foreign plan assets in the fiscal years ended June 30, 2015 and 2014 . The expected aggregate employer contribution for the foreign plans during the fiscal year ending June 30, 2016 is $1.7 million . The total benefits to be paid from the foreign pension plans are not expected to exceed $2.5 million in any year through the fiscal year ending June 30, 2025 . Foreign plan assets measured at fair value on a recurring basis consisted of the following investment categories as of June 30, 2015 and 2014 , respectively: As of June 30, 2015 (In thousands) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Cash and cash equivalents $ 10,954 $ 10,954 $ — Bonds, equity securities and other investments 6,084 — 6,084 Total assets measured at fair value $ 17,038 $ 10,954 $ 6,084 As of June 30, 2014 (In thousands) Total Quoted Prices in Significant Other Cash and cash equivalents $ 11,061 $ 11,061 $ — Bonds, equity securities and other investments 4,102 — 4,102 Total assets measured at fair value $ 15,163 $ 11,061 $ 4,102 Concentration of Risk The Company manages a variety of risks, including market, credit and liquidity risks, across its plan assets through its investment managers. The Company defines a concentration of risk as an undiversified exposure to one of the above-mentioned risks that increases the exposure of the loss of plan assets unnecessarily. The Company monitors exposure to such risks in the foreign plans by monitoring the magnitude of the risk in each plan and diversifying the Company’s exposure to such risks across a variety of instruments, markets and counterparties. As of June 30, 2015 , the Company did not have concentrations of plan asset investment risk in any single entity, manager, counterparty, sector, industry or country. |
Income Taxes
Income Taxes | 12 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES The components of income before income taxes are as follows: Year ended June 30, (In thousands) 2015 2014 2013 Domestic income before income taxes $ 157,251 $ 434,336 $ 420,862 Foreign income before income taxes 276,880 300,125 269,759 Total income before income taxes $ 434,131 $ 734,461 $ 690,621 The provision for income taxes is comprised of the following: (In thousands) Year ended June 30, 2015 2014 2013 Current: Federal $ 63,123 $ 98,937 $ 118,888 State 3,655 8,580 4,404 Foreign 25,438 27,867 25,112 92,216 135,384 148,404 Deferred: Federal (22,390 ) 22,904 (2,552 ) State 409 (334 ) (1,036 ) Foreign (2,262 ) (6,248 ) 2,656 (24,243 ) 16,322 (932 ) Provision for income taxes $ 67,973 $ 151,706 $ 147,472 For the fiscal year ended June 30, 2015 , actual current tax liabilities were lower than reflected in the table above by $16.7 million primarily due to a benefit for a deduction related to employee stock activity, which was recorded as an increase to capital in excess of par value. For the fiscal year ended June 30, 2014 , actual current tax liabilities were lower than reflected in the table above by $16.5 million primarily due to a benefit for a deduction related to employee stock activity, which was recorded as an increase to capital in excess of par value. For the fiscal year ended June 30, 2013 , actual current tax liabilities were lower than reflected in the table above by $6.9 million primarily due to a benefit for a deduction related to employee stock activity, which was recorded as an increase to capital in excess of par value. The significant components of deferred income tax assets and liabilities are as follows: (In thousands) As of June 30, 2015 2014 Deferred tax assets: Tax credits and net operating losses $ 108,615 $ 95,492 Employee benefits accrual 99,472 97,308 Stock-based compensation 18,722 17,676 Capitalized R&D expenses 47 12,051 Inventory reserves 92,649 83,783 Non-deductible reserves 47,176 41,469 Depreciation and amortization 13,267 2,572 Unearned revenue 16,150 13,937 Other 28,784 29,483 Gross deferred tax assets 424,882 393,771 Valuation allowance (91,350 ) (76,328 ) Net deferred tax assets $ 333,532 $ 317,443 Deferred tax liabilities: Unremitted earnings of foreign subsidiaries not permanently reinvested $ (12,775 ) $ (17,334 ) Deferred profit (7,372 ) (16,358 ) Unrealized gain on investments (2,673 ) (1,168 ) Total deferred tax liabilities (22,820 ) (34,860 ) Total net deferred tax assets $ 310,712 $ 282,583 As of June 30, 2015 , the Company had U.S. federal, state and foreign net operating loss (“NOL”) carry-forwards of approximately $25.7 million , $90.8 million and $50.2 million , respectively. The U.S. federal NOL carry-forwards will expire at various dates beginning in 2023 through 2027 . The utilization of NOLs created by acquired companies is subject to annual limitations under Section 382 of the Internal Revenue Code. However, it is not expected that such annual limitation will significantly impair the realization of these NOLs. The state NOLs will begin to expire in 2017 . State credits of $123.7 million will be carried over indefinitely. The foreign NOL carry-forwards will begin to expire in 2016 . The net deferred tax asset valuation allowance was $91.4 million and $76.3 million as of June 30, 2015 and June 30, 2014 , respectively. The change was primarily due to an increase in the valuation allowance related to state credit carry-forwards generated in the fiscal year ended June 30, 2015 . The valuation allowance is based on the Company’s assessment that it is more likely than not that certain deferred tax assets will not be realized in the foreseeable future. Of the valuation allowance as of June 30, 2015 , $76.9 million relates to state credit carry-forwards. The remainder of the valuation allowance relates primarily to foreign NOL carry-forwards. As of June 30, 2015 , U.S. income taxes were not provided for on a cumulative total of approximately $1.7 billion of undistributed earnings for certain non-U.S. subsidiaries. If these undistributed earnings were repatriated to the United States, they would generate foreign tax credits to reduce the federal tax liability associated with the foreign dividend. Assuming full utilization of the foreign tax credits, the potential deferred tax liability associated with undistributed earnings would be approximately $573.9 million . KLA-Tencor benefits from tax holidays in Israel and Singapore where it manufactures certain of its products. These tax holidays are on approved investments and are scheduled to expire at varying times. One tax holiday expired this year and the remaining tax holidays will expire beginning in 2019 through 2021 . The impact on the tax holiday that expired this year was approximately $3.1 million in tax savings for the fiscal year ended June 30, 2015 . The Company was in compliance with all the terms and conditions of the tax holidays as of June 30, 2015 . The net impact of these tax holidays was to decrease the Company’s tax expense by approximately $20.4 million , $25.8 million and $25.8 million in the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. The benefits of the tax holidays on diluted net income per share were $0.13 , $0.15 and $0.15 for the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. The reconciliation of the United States federal statutory income tax rate to KLA-Tencor’s effective income tax rate is as follows: Year ended June 30, 2015 2014 2013 Federal statutory rate 35.0 % 35.0 % 35.0 % State income taxes, net of federal benefit 0.7 % 0.7 % 0.3 % Effect of foreign operations taxed at various rates (15.3 )% (11.5 )% (9.6 )% Research and development tax credit (3.7 )% (1.5 )% (3.1 )% Net change in tax reserves 1.5 % 0.3 % 1.7 % Domestic manufacturing benefit (2.1 )% (1.4 )% (1.6 )% Effect of stock-based compensation 0.8 % 0.4 % (0.3 )% Other (1.2 )% (1.3 )% (1.0 )% Effective income tax rate 15.7 % 20.7 % 21.4 % A reconciliation of gross unrecognized tax benefits is as follows: Year ended June 30, (In thousands) 2015 2014 2013 Unrecognized tax benefits at the beginning of the year $ 59,575 $ 59,494 $ 50,839 Increases for tax positions taken in prior years 1,245 551 2,701 Decreases for tax positions taken in prior years (7 ) (764 ) (905 ) Increases for tax positions taken in current year 11,634 11,585 12,709 Decreases for settlements with taxing authorities — (3,601 ) (3,907 ) Decreases for lapsing of statutes of limitations (3,429 ) (7,690 ) (1,943 ) Unrecognized tax benefits at the end of the year $ 69,018 $ 59,575 $ 59,494 The amount of unrecognized tax benefits that would impact the effective tax rate was $69.0 million , $59.6 million and $59.5 million as of June 30, 2015 , 2014 and 2013 respectively. The amount of interest and penalties recognized during the years ended June 30, 2015, 2014, and 2013 was $1.2 million , $0.7 million , and $1.4 million , respectively. KLA-Tencor’s policy is to include interest and penalties related to unrecognized tax benefits within other expense (income), net. The amount of interest and penalties accrued as of June 30, 2015 and 2014 was approximately $7.9 million and $6.7 million , respectively. The Company is subject to federal income tax examinations for all years beginning from the fiscal year ended June 30, 2011 and is under United States federal income tax examination for the fiscal year ended June 30, 2013. The Company is subject to state income tax examinations for all years beginning from the fiscal year ended June 30, 2011. The Company is also subject to examinations in other major foreign jurisdictions, including Singapore, for all years beginning from the fiscal year ended June 30, 2011. The Company believes that adequate amounts have been reserved for any adjustments that may ultimately result from any future examinations of these years. It is possible that certain examinations may be concluded in the next twelve months. The Company believes it is possible that it may recognize up to $27.3 million of its existing unrecognized tax benefits within the next 12 months as a result of the lapse of statutes of limitations and the resolution of examinations with various tax authorities. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Factoring. KLA-Tencor has agreements (referred to as “factoring agreements”) with financial institutions to sell certain of its trade receivables and promissory notes from customers without recourse. The Company does not believe it is at risk for any material losses as a result of these agreements. In addition, the Company periodically sells certain letters of credit (“LCs”), without recourse, received from customers in payment for goods. The following table shows total receivables sold under factoring agreements and proceeds from sales of LCs for the indicated periods: Year ended June 30, (In thousands) 2015 2014 Receivables sold under factoring agreements $ 137,285 $ 116,292 Proceeds from sales of LCs $ 6,920 $ 8,323 Factoring and LC fees for the sale of certain trade receivables were recorded in other expense (income), net and were not material for the periods presented. Facilities. KLA-Tencor leases certain of its facilities under arrangements that are accounted for as operating leases. Rent expense was $9.1 million , $8.7 million and $9.2 million for the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. The following is a schedule of expected operating lease payments: Fiscal year ending June 30, Amount (In thousands) 2016 $ 8,008 2017 5,818 2018 3,964 2019 1,815 2020 1,220 2021 and thereafter 556 Total minimum lease payments $ 21,381 Purchase Commitments. KLA-Tencor maintains commitments to purchase inventory from its suppliers as well as goods and services in the ordinary course of business. The Company’s liability under these purchase commitments is generally restricted to a forecasted time-horizon as mutually agreed upon between the parties. This forecasted time-horizon can vary among different suppliers. The Company’s estimate of its significant purchase commitments is approximately $298.7 million as of June 30, 2015 which are primarily due within the next 12 months. Actual expenditures will vary based upon the volume of the transactions and length of contractual service provided. In addition, the amounts paid under these arrangements may be less in the event that the arrangements are renegotiated or canceled. Certain agreements provide for potential cancellation penalties. Cash Long-Term Incentive Plan. As of June 30, 2015 , the Company had committed $125.0 million to future payment obligations under its Cash LTI Plan. The calculation of compensation expense related to the Cash LTI Plan includes estimated forfeiture rate assumptions. Cash LTI awards issued to employees under the Cash LTI Plan vest in four equal installments, with 25% of the aggregate amount of the Cash LTI award vesting on each yearly anniversary of the grant date over a four -year period. In order to receive payments under a Cash LTI award, participants must remain employed by the Company as of the applicable award vesting date. Warranties, Guarantees and Contingencies. KLA-Tencor provides standard warranty coverage on its systems for 40 hours per week for 12 months, providing labor and parts necessary to repair the systems during the warranty period. The Company accounts for the estimated warranty cost as a charge to costs of revenues when revenue is recognized. The estimated warranty cost is based on historical product performance and field expenses. Utilizing actual service records, the Company calculates the average service hours and parts expense per system and applies the actual labor and overhead rates to determine the estimated warranty charge. The Company updates these estimated charges on a regular basis. The actual product performance and/or field expense profiles may differ, and in those cases the Company adjusts its warranty accruals accordingly. The following table provides the changes in the product warranty accrual for the indicated periods: Year ended June 30, (In thousands) 2015 2014 Beginning balance $ 37,746 $ 42,603 Accruals for warranties issued during the period 39,368 45,540 Changes in liability related to pre-existing warranties (572 ) (8,462 ) Settlements made during the period (40,129 ) (41,935 ) Ending balance $ 36,413 $ 37,746 The Company maintains guarantee arrangements available through various financial institutions for up to $22.5 million , of which $19.0 million had been issued as of June 30, 2015 , primarily to fund guarantees to customs authorities for value-added tax (“VAT”) and other operating requirements of the Company’s subsidiaries in Europe and Asia. KLA-Tencor is a party to a variety of agreements pursuant to which it may be obligated to indemnify the other party with respect to certain matters. Typically, these obligations arise in connection with contracts and license agreements or the sale of assets, under which the Company customarily agrees to hold the other party harmless against losses arising from, or provides customers with other remedies to protect against, bodily injury or damage to personal property caused by the Company’s products, non-compliance with the Company’s product performance specifications, infringement by the Company’s products of third-party intellectual property rights and a breach of warranties, representations and covenants related to matters such as title to assets sold, validity of certain intellectual property rights, non-infringement of third-party rights, and certain income tax-related matters. In each of these circumstances, payment by the Company is typically subject to the other party making a claim to and cooperating with the Company pursuant to the procedures specified in the particular contract. This usually allows the Company to challenge the other party’s claims or, in case of breach of intellectual property representations or covenants, to control the defense or settlement of any third-party claims brought against the other party. Further, the Company’s obligations under these agreements may be limited in terms of amounts, activity (typically at the Company’s option to replace or correct the products or terminate the agreement with a refund to the other party), and duration. In some instances, the Company may have recourse against third parties and/or insurance covering certain payments made by the Company. Subject to certain limitations, the Company is obligated to indemnify its current and former directors, officers and employees with respect to certain litigation matters and investigations that arise in connection with their service to the Company. These obligations arise under the terms of the Company’s certificate of incorporation, its bylaws, applicable contracts, and Delaware and California law. The obligation to indemnify generally means that the Company is required to pay or reimburse the individuals’ reasonable legal expenses and possibly damages and other liabilities incurred in connection with these matters. In addition, the Company may in limited circumstances enter into agreements that contain customer-specific commitments on pricing, tool reliability, spare parts stocking levels, response time and other commitments. Furthermore, the Company may give these customers limited audit or inspection rights to enable them to confirm that the Company is complying with these commitments. If a customer elects to exercise its audit or inspection rights, the Company may be required to expend significant resources to support the audit or inspection, as well as to defend or settle any dispute with a customer that could potentially arise out of such audit or inspection. To date, the Company has made no significant accruals in its consolidated financial statements for this contingency. While the Company has not in the past incurred significant expenses for resolving disputes regarding these types of commitments, the Company cannot make any assurance that it will not incur any such liabilities in the future. 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 unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under these agreements have not had a material effect on its business, financial condition, results of operations or cash flows. |
Litigation and Other Legal Matt
Litigation and Other Legal Matters | 12 Months Ended |
Jun. 30, 2015 | |
Loss Contingency, Information about Litigation Matters [Abstract] | |
Litigation and Other Legal Matters | LITIGATION AND OTHER LEGAL MATTERS The Company is named from time to time as a party to lawsuits and other types of legal proceedings and claims in the normal course of its business. Actions filed against the Company include commercial, intellectual property, customer, and labor and employment related claims, including complaints of alleged wrongful termination and potential class action lawsuits regarding alleged violations of federal and state wage and hour and other laws. In general, legal proceedings and claims, regardless of their merit, and associated internal investigations (especially those relating to intellectual property or confidential information disputes) are often expensive to prosecute, defend or conduct and may divert management’s attention and other company resources. Moreover, the results of legal proceedings are difficult to predict, and the costs incurred in litigation can be substantial, regardless of outcome. The Company believes the amounts provided in its consolidated financial statements are adequate in light of the probable and estimated liabilities. However, because such matters are subject to many uncertainties, the ultimate outcomes are not predictable, and there can be no assurances that the actual amounts required to satisfy alleged liabilities from the matters described above will not exceed the amounts reflected in the Company’s consolidated financial statements or will not have a material adverse effect on its results of operations, financial condition or cash flows. |
Restructuring Charges
Restructuring Charges | 12 Months Ended |
Jun. 30, 2015 | |
Restructuring Charges [Abstract] | |
Restructuring Charges | RESTRUCTURING CHARGES The Company has in recent years undertaken a number of cost reduction activities, including workforce reductions, in an effort to lower its ongoing expense run rate. The program in the United States is accounted for in accordance with the authoritative guidance related to compensation for non-retirement post-employment benefits, whereas the programs in the Company’s international locations are accounted for in accordance with the authoritative guidance for contingencies. In April 2015, we announced a plan to reduce our global employee workforce to streamline our organization and business processes in response to changing customer requirement in our industry. The goals of this reduction are to enable continued innovation, direct our resources toward our best opportunities and lower our ongoing expense run rate. During the fiscal year ended June 30, 2015, we recorded a $31.6 million net restructuring charge, of which $8.0 million was recorded to costs of revenues, $11.1 million to engineering, research and development expense and $12.5 million to selling, general and administrative expense. Net restructuring charge amounting to $22.4 million was recorded during the fourth quarter of fiscal year ended June 30, 2015, substantial majority of which is related to our global workforce reduction plan. The following table shows the activity primarily related to accrual for severance and benefits for the fiscal years ended June 30, 2015 and 2014 : Year ended June 30, (In thousands) 2015 2014 Beginning balance $ 2,329 $ 3,947 Restructuring costs 31,569 6,662 Adjustments 1,177 (459 ) Cash payments (10,188 ) (7,821 ) Ending balance $ 24,887 $ 2,329 The accrual for severance and benefits as of June 30, 2015 is expected to be paid out by the end of our fiscal quarter ending December 31, 2015 . The Company expects to incur additional charges, including additional severance costs and other related costs, in connection with the completion of its global workforce reduction during the first two quarters of fiscal year 2016 . |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 12 Months Ended |
Jun. 30, 2015 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Derivative Instruments and Hedging Activities | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The authoritative guidance requires companies to recognize all derivative instruments and hedging activities, including foreign currency exchange contracts, as either assets or liabilities at fair value on the balance sheet. Changes in the fair value of derivatives that do not qualify for hedge treatment, as well as the ineffective portion of any hedges, are recognized in other expense (income), net in the consolidated statements of operations. In accordance with the guidance, the Company designates foreign currency forward exchange and option contracts as cash flow hedges of certain forecasted foreign currency denominated sales and purchase transactions. KLA-Tencor’s foreign subsidiaries operate and sell KLA-Tencor’s products in various global markets. As a result, KLA-Tencor is exposed to risks relating to changes in foreign currency exchange rates. KLA-Tencor utilizes foreign currency forward exchange contracts and option contracts to hedge against future movements in foreign exchange rates that affect certain existing and forecasted foreign currency denominated sales and purchase transactions, such as the Japanese yen, the euro, the New Taiwan dollar and the Israeli new shekel. The Company routinely hedges its exposures to certain foreign currencies with various financial institutions in an effort to minimize the impact of certain currency exchange rate fluctuations. These currency forward exchange contracts and options, designated as cash flow hedges, generally have maturities of less than 18 months . Cash flow hedges are evaluated for effectiveness monthly, based on changes in total fair value of the derivatives. If a financial counterparty to any of the Company’s hedging arrangements experiences financial difficulties or is otherwise unable to honor the terms of the foreign currency hedge, the Company may experience material losses. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gains or losses on the derivative is reported as a component of accumulated other comprehensive income (loss) (“OCI”) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Changes in the fair value of currency forward exchange and option contracts due to changes in time value are excluded from the assessment of effectiveness. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. For derivative instruments that are not designated as accounting hedges, gains and losses are recognized in other expense (income), net. The Company uses foreign currency forward contracts to hedge certain foreign currency denominated assets or liabilities. The gains and losses on these derivatives are largely offset by the changes in the fair value of the assets or liabilities being hedged. In October 2014, in anticipation of the issuance of the Senior Notes, the Company entered into a series of forward contracts (“Rate Lock Agreements”) to lock the benchmark rate on a portion of the Senior Notes. The objective of the Rate Lock Agreements was to hedge the risk associated with the variability in interest rates due to the changes in the benchmark rate leading up to the closing of the intended financing, on the notional amount being hedged. The Rate Lock Agreements had a notional amount of $1 billion in aggregate which matured in the second quarter of the fiscal year ended June 30, 2015 . The Company designated each of the Rate Lock Agreements as a qualifying hedging instrument and accounted for as a cash flow hedge, under which the effective portion of the gain or loss on the close out of the Rate Lock Agreements was initially recognized in accumulated other comprehensive income (loss) as a reduction of total stockholders’ equity and subsequently amortized into earnings as a component of interest expense over the term of the underlying debt. The ineffective portion, if any, was recognized in earnings immediately. The Rate Lock Agreements were terminated on the date of pricing of the $1.25 billion of 4.650% Senior Notes due in 2024 and the Company recorded the fair value of a $7.5 million receivable as a gain within accumulated other comprehensive income (loss) as of December 31, 2014 . For the fiscal year ended June 30, 2015 , the Company recognized $0.5 million for the amortization of the gain recognized in accumulated other comprehensive income (loss), which amount reduced the interest expense. The Company did not record any ineffectiveness for the fiscal year ended June 30, 2015 . The cash proceeds of $7.5 million from the settlement of the Rate Lock Agreements were included in the cash flows from operating activities in the consolidated statements of cash flows for the fiscal year ended June 30, 2015 because the designated hedged item was classified as interest expense in the cash flows from operating activities in the consolidated statements of cash flows. In addition, in November 2014, the Company entered into a non-designated forward contract to lock the treasury rate used to determine the redemption amount of the 2018 Senior Notes that occurred during the three months ended December 31, 2014 . The objective of the forward contract was to hedge the risk associated with the variability of the redemption amount due to changes in interest rates through the redemption of the existing 2018 Senior Notes. The forward contract had a notional amount of $750 million . The forward contract was terminated in December 2014 and the resulting fair value of $1.2 million receivable was included in the loss on extinguishment of debt and other, net line in the consolidated statements of operations, partially offsetting the loss on redemption of the debt during the three months December 31, 2014 . The cash proceeds from the forward contract were included in the cash flows from financing activities in the consolidated statements of cash flows for the fiscal year ended June 30, 2015 , partially offsetting the cash outflows for the redemption of the 2018 Senior Notes. Derivatives in Cash Flow Hedging Relationships: Foreign Exchange and Interest Rate Contracts The locations and amounts of designated and non-designated derivative instruments’ gains and losses reported in the consolidated financial statements for the indicated periods were as follows: (In thousands) Location in Financial Statements Year ended June 30, 2015 2014 Derivatives Designated as Hedging Instruments Gains in accumulated OCI on derivatives (effective portion) Accumulated OCI $ 13,745 $ 1,641 Gains reclassified from accumulated OCI into income (effective portion): Revenues $ 7,615 $ 3,851 Costs of revenues (1,503 ) 294 Interest expense 503 — Net gains reclassified from accumulated OCI into income (effective portion) $ 6,615 $ 4,145 Gains recognized in income on derivatives (ineffective portion and amount excluded from effectiveness testing) Other expense (income), net $ 243 $ 18 Derivatives Not Designated as Hedging Instruments Gains recognized in income Other expense (income), net $ 13,976 $ 2,856 Loss on extinguishment of debt and other, net $ 1,180 $ — The U.S. dollar equivalent of all outstanding notional amounts of hedge contracts, with maximum maturity of 16 months , as of the dates indicated below was as follows: (In thousands) As of As of Cash flow hedge contracts Purchase $ 32,775 $ 6,066 Sell $ 88,800 $ 33,999 Other foreign currency hedge contracts Purchase $ 64,012 $ 108,901 Sell $ 123,091 $ 106,322 The locations and fair value amounts of the Company’s derivative instruments reported in its Consolidated Balance Sheets as of the dates indicated below were as follows: Asset Derivatives Liability Derivatives Balance Sheet Location As of As of Balance Sheet Location As of As of (In thousands) Fair Value Fair Value Derivatives designated as hedging instruments Foreign exchange contracts Other current assets $ 1,722 $ 120 Other current liabilities $ 1,920 $ 100 Total derivatives designated as hedging instruments 1,722 120 1,920 100 Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets 1,342 546 Other current liabilities 1,186 798 Total derivatives not designated as hedging instruments 1,342 546 1,186 798 Total derivatives $ 3,064 $ 666 $ 3,106 $ 898 The following table provides the balances and changes in accumulated OCI, before taxes, related to derivative instruments for the indicated periods: Year ended June 30, (In thousands) 2015 2014 Beginning balance $ (20 ) $ 2,484 Amount reclassified to income (6,615 ) (4,145 ) Net change in unrealized gains or losses 13,745 1,641 Ending balance $ 7,110 $ (20 ) Offsetting of Derivative Assets and Liabilities KLA-Tencor presents derivatives at gross fair values in the Consolidated Balance Sheets. The Company has entered into arrangements with each of its counterparties, which reduce credit risk by permitting net settlement of transactions with the same counterparty under certain conditions. As of June 30, 2015 and 2014 , information related to the offsetting arrangements was as follows (in thousands): As of June 30, 2015 Gross Amounts of Derivatives Not Offset in the Consolidated Balance Sheets Description Gross Amounts of Derivatives Gross Amounts of Derivatives Offset in the Consolidated Balance Sheets Net Amount of Derivatives Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives - Assets $ 3,064 $ — $ 3,064 $ (2,809 ) $ — $ 255 Derivatives - Liabilities $ (3,106 ) $ — $ (3,106 ) $ 2,809 $ — $ (297 ) As of June 30, 2014 Gross Amounts of Derivatives Not Offset in the Consolidated Balance Sheets Description Gross Amounts of Derivatives Gross Amounts of Derivatives Offset in the Consolidated Balance Sheets Net Amount of Derivatives Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives - Assets $ 666 $ — $ 666 $ (423 ) $ — $ 243 Derivatives - Liabilities $ (898 ) $ — $ (898 ) $ 423 $ — $ (475 ) |
Segment Reporting and Geographi
Segment Reporting and Geographic Information | 12 Months Ended |
Jun. 30, 2015 | |
Segment Reporting Information, Additional Information [Abstract] | |
Segment Reporting and Geographic Information | SEGMENT REPORTING AND GEOGRAPHIC INFORMATION KLA-Tencor reports one reportable segment in accordance with the provisions of the authoritative guidance for segment reporting. Operating segments are defined as components of an enterprise about which separate financial information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. KLA-Tencor’s chief operating decision maker is the Chief Executive Officer. The Company is engaged primarily in designing, manufacturing and marketing process control and yield management solutions for the semiconductor and related nanoelectronics industries. All operating segments have been aggregated due to their inter-dependencies, commonality of long-term economic characteristics, products and services, the production processes, class of customer and distribution processes. The Company’s service products are an extension of the system product portfolio and provide customers with spare parts and fab management services (including system preventive maintenance and optimization services) to improve yield, increase production uptime and throughput, and lower the cost of ownership. Since the Company operates in one reportable segment, all financial segment information required by the authoritative guidance can be found in the consolidated financial statements. The Company’s significant operations outside the United States include manufacturing facilities in Singapore, Israel, Germany and China and sales, marketing and service offices in Western Europe, Japan and the Asia Pacific regions. For geographical revenue reporting, revenues are attributed to the geographic location in which the customer is located. Long-lived assets consist of land, property and equipment, net and are attributed to the geographic region in which they are located. The following is a summary of revenues by geographic region, based on ship-to location, for the indicated periods (as a percentage of total revenues): (Dollar amounts in thousands) Year ended June 30, 2015 2014 2013 Revenues: North America $ 815,914 29 % $ 705,159 24 % $ 846,125 30 % Taiwan 691,482 25 % 741,470 25 % 936,445 33 % Japan 426,963 15 % 334,653 11 % 310,204 11 % Europe & Israel 194,670 7 % 306,779 11 % 211,121 7 % Korea 405,320 14 % 371,139 13 % 292,724 10 % Rest of Asia 279,700 10 % 470,208 16 % 246,162 9 % Total $ 2,814,049 100 % $ 2,929,408 100 % $ 2,842,781 100 % The following is a summary of revenues by major products for the indicated periods (as a percentage of total revenues): (Dollar amounts in thousands) Year ended June 30, 2015 2014 2013 Revenues: Defect inspection $ 1,541,422 55 % $ 1,685,114 58 % $ 1,594,128 56 % Metrology 492,175 18 % 532,002 18 % 540,835 19 % Service 688,653 24 % 642,971 22 % 595,634 21 % Other 91,799 3 % 69,321 2 % 112,184 4 % Total $ 2,814,049 100 % $ 2,929,408 100 % $ 2,842,781 100 % In the fiscal year ended June 30, 2015 , three customers accounted for approximately 15% , 12% and 11% of total revenues. In the fiscal year ended June 30, 2014 , three customers accounted for approximately 18% , 14% and 11% of total revenues. In the fiscal year ended June 30, 2013 , two customers accounted for approximately 23% and 13% of total revenues. Long-lived assets by geographic region as of the dates indicated below were as follows: As of June 30, (In thousands) 2015 2014 Long-lived assets: United States $ 207,779 $ 219,280 Europe 16,536 19,527 Singapore 45,444 48,938 Israel 33,841 33,388 Rest of Asia 10,991 9,130 Total $ 314,591 $ 330,263 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Jun. 30, 2015 | |
Related Party Transaction, Due from (to) Related Party [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS During the fiscal years ended June 30, 2015 , 2014 and 2013 , the Company purchased from, or sold to, several entities, where one or more executive officers of the Company or members of the Company’s Board of Directors, or their immediate family members, also serves as an executive officer or board member, including Avago Technologies Ltd., Cisco Systems, Inc., Citrix System, Inc., Freescale Semiconductor, Inc., JDS Uniphase Corporation, NetApp, Inc. and SAP AG. The following table provides the transactions with these parties for the indicated periods (for the portion of the period during which they were considered related): Year ended June 30, (In thousands) 2015 2014 2013 Total revenues $ 1,856 $ 2,701 $ 6,854 Total purchases $ 1,098 $ 2,622 $ 4,460 The Company had a receivable balance from these parties of $0.1 million and $1.8 million as of June 30, 2015 and 2014 , respectively. Management believes that such transactions are at arm’s length and on similar terms as would have been obtained from unaffiliated third parties. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jun. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS On July 14, 2015 , the Company announced that its Board of Directors had authorized a further increase in the level of the Company’s quarterly cash dividend from $0.50 to $0.52 per share. On August 6, 2015 , the Company announced that its Board of Directors had declared a quarterly cash dividend of $0.52 per share to be paid on September 1, 2015 to stockholders of record as of the close of business on August 17, 2015 . |
Quarterly Consolidated Results
Quarterly Consolidated Results of Operations (Unaudited) | 12 Months Ended |
Jun. 30, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Consolidated Results of Operations (Unaudited) | QUARTERLY CONSOLIDATED RESULTS OF OPERATIONS (UNAUDITED) The following is a summary of the Company’s quarterly consolidated results of operations (unaudited) for the fiscal years ended June 30, 2015 and 2014 . (In thousands, except per share data) First quarter ended September 30, 2014 Second quarter ended December 31, 2014 Third quarter ended March 31, 2015 Fourth quarter ended June 30, 2015 Total revenues $ 642,901 $ 676,357 $ 738,459 $ 756,332 Gross margin $ 354,434 $ 393,144 $ 418,177 $ 433,065 Net income $ 72,233 $ 20,268 $ 131,638 $ 142,019 Net income per share: Basic (1) $ 0.44 $ 0.12 $ 0.81 $ 0.90 Diluted (1) $ 0.43 $ 0.12 $ 0.81 $ 0.89 (In thousands, except per share data) First quarter ended September 30, 2013 Second quarter ended December 31, 2013 Third quarter ended March 31, 2014 Fourth quarter ended June 30, 2014 Total revenues $ 658,337 $ 705,129 $ 831,599 $ 734,343 Gross margin $ 380,680 $ 419,315 $ 488,773 $ 407,678 Net income $ 111,197 $ 139,246 $ 203,581 $ 128,731 Net income per share: Basic (1) $ 0.67 $ 0.84 $ 1.22 $ 0.78 Diluted (1) $ 0.66 $ 0.83 $ 1.21 $ 0.77 __________________ (1) Basic and diluted earnings per share are computed independently for each of the quarters presented based on the weighted-average basic and fully diluted shares outstanding for each quarter. Therefore, the sum of quarterly basic and diluted per share information may not equal annual basic and diluted earnings per share. The Company’s net income decreased to $20.3 million in the three months ended December 31, 2014 , primarily as a result of a pre-tax net loss of $131.7 million pertaining to the net loss on extinguishment of debt and certain one-time expenses of $2.5 million associated with the leverage recapitalization. |
Summary of Significant Accoun30
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Description of Operations and Principles of Consolidation | Description of Operations and Principles of Consolidation. KLA-Tencor Corporation (“KLA-Tencor” or the “Company”) is a leading supplier of process control and yield management solutions for the semiconductor and related nanoelectronics industries. Headquartered in Milpitas, California, KLA-Tencor has subsidiaries both in the United States and in key markets throughout the world. The Consolidated Financial Statements include the accounts of KLA-Tencor and its majority-owned subsidiaries. All significant intercompany balances and transactions have been eliminated. |
Management Estimates | Management Estimates. The preparation of the Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions in applying the Company’s accounting policies that affect the reported amounts of assets and liabilities (and related disclosure of contingent assets and liabilities) at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. |
Cash Equivalent and Marketable Securities | Cash Equivalents and Marketable Securities. All highly liquid debt instruments with original or remaining maturities of less than three months at the date of purchase are considered to be cash equivalents. Marketable securities are generally classified as available-for-sale for use in current operations, if required, and are reported at fair value, with unrealized gains and losses, net of tax, presented as a separate component of stockholders’ equity under the caption “Accumulated other comprehensive income (loss).” All realized gains and losses and unrealized losses resulting from declines in fair value that are other than temporary are recorded in earnings in the period of occurrence. The specific identification method is used to determine the realized gains and losses on investments. For all investments in debt and equity securities, the Company assesses whether the impairment is other than temporary. If the fair value of a debt security is less than its amortized cost basis, an impairment is considered other than temporary if (i) the Company has the intent to sell the security or it is more likely than not that the Company will be required to sell the security before recovery of its entire amortized cost basis, or (ii) the Company does not expect to recover the entire amortized cost of the security. If an impairment is considered other than temporary based on condition (i), the entire difference between the amortized cost and the fair value of the security is recognized in earnings. If an impairment is considered other than temporary based on condition (ii), the amount representing credit losses, defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis of the debt security, will be recognized in earnings, and the amount relating to all other factors will be recognized in other comprehensive income (loss). The Company evaluates both qualitative and quantitative factors such as duration and severity of the unrealized losses, credit ratings, default and loss rates of the underlying collateral, structure and credit enhancements to determine if a credit loss may exist. |
Non-Marketable Equity Securities and Other Investments | Non-Marketable Equity Securities and Other Investments. KLA-Tencor acquires certain equity investments for the promotion of business and strategic objectives, and, to the extent these investments continue to have strategic value, the Company typically does not attempt to reduce or eliminate the inherent market risks. Non-marketable equity securities and other investments are recorded at historical cost. Non-marketable equity securities and other investments are included in “Other non-current assets” on the balance sheet. Non-marketable equity securities are subject to a periodic impairment review; however, there are no open-market valuations, and the impairment analysis requires significant judgment. This analysis includes assessment of the investee’s financial condition, the business outlook for its products and technology, its projected results and cash flow, the likelihood of obtaining subsequent rounds of financing and the impact of any relevant contractual equity preferences held by the Company or others. |
Variable Interest Entities | Variable Interest Entities. KLA-Tencor uses a qualitative approach in assessing the consolidation requirement for variable interest entities. The approach focuses on identifying which enterprise has the power to direct the activities that most significantly impact the variable interest entity’s economic performance and which enterprise has the obligation to absorb losses or the right to receive benefits from the variable interest entity. In the event that the Company is the primary beneficiary of a variable interest entity, the assets, liabilities, and results of operations of the variable interest entity will be included in the Company’s Consolidated Financial Statements. The Company has concluded that none of the Company’s equity investments require consolidation as per the Company’s most recent qualitative assessment. |
Inventories | Inventories. Inventories are stated at the lower of cost (on a first-in, first-out basis) or market. Demonstration units are stated at their manufacturing cost and written down to their net realizable value. The Company reviews and sets standard costs semi-annually at current manufacturing costs in order to approximate actual costs. The Company’s manufacturing overhead standards for product costs are calculated assuming full absorption of forecasted spending over projected volumes, adjusted for excess capacity. Abnormal inventory costs such as costs of idle facilities, excess freight and handling costs, and spoilage are recognized as current period charges. The Company writes down product inventory based on forecasted demand and technological obsolescence and service spare parts inventory based on forecasted usage. These factors are impacted by market and economic conditions, technology changes, new product introductions and changes in strategic direction and require estimates that may include uncertain elements. Actual demand may differ from forecasted demand, and such differences may have a material effect on recorded inventory values. |
Allowance for Doubtful Accounts | Allowance for Doubtful Accounts. A majority of the Company’s trade receivables are derived from sales to large multinational semiconductor manufacturers throughout the world. In order to monitor potential credit losses, the Company performs ongoing credit evaluations of its customers’ financial condition. An allowance for doubtful accounts is maintained for probable credit losses based upon the Company’s assessment of the expected collectibility of the accounts receivable. The allowance for doubtful accounts is reviewed on a quarterly basis to assess the adequacy of the allowance. |
Property and Equipment | Property and equipment are recorded at cost, net of accumulated depreciation. Depreciation of property and equipment is based on the straight-line method over the estimated useful lives of the assets. |
Business Combinations | Business Combinations. KLA-Tencor allocates the fair value of the purchase consideration of the Company’s acquisitions to the tangible assets, liabilities, and intangible assets acquired, including in-process research and development (“IPR&D”), based on their estimated fair values. The excess of the fair value of purchase consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. IPR&D is initially capitalized at fair value as an intangible asset with an indefinite life and assessed for impairment thereafter. When a project underlying reported IPR&D is completed, the corresponding amount of IPR&D is reclassified as an amortizable purchased intangible asset and is amortized over the asset’s estimated useful life. Acquisition-related expenses and restructuring costs are recognized separately from the business combination and are expensed as incurred. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets. KLA-Tencor assesses goodwill for impairment annually as well as whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Long-lived intangible assets are tested for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. See Note 6, “Goodwill and Purchased Intangible Assets” for a detailed description. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets. KLA-Tencor evaluates the carrying value of its long-lived assets whenever events or changes in circumstances indicate that the carrying value of the asset may be impaired. An impairment loss is recognized when estimated future cash flows expected to result from the use of the asset, including disposition, are less than the carrying value of the asset. Such an impairment charge would be measured as the excess of the carrying value of the asset over its fair value. |
Concentration of Credit Risk | Concentration of Credit Risk. Financial instruments that potentially subject KLA-Tencor to significant concentrations of credit risk consist primarily of cash equivalents, short-term marketable securities, trade accounts receivable and derivative financial instruments used in hedging activities. The Company invests in a variety of financial instruments, such as, but not limited to, certificates of deposit, corporate debt and municipal securities, United States Treasury and Government agency securities, and equity securities and, by policy, limits the amount of credit exposure with any one financial institution or commercial issuer. The Company has not experienced any material credit losses on its investments. A majority of the Company’s trade receivables are derived from sales to large multinational semiconductor manufacturers located throughout the world, with a majority located in Asia. In recent years, the Company’s customer base has become increasingly concentrated due to corporate consolidation, acquisitions and business closures, and to the extent that these customers experience liquidity issues in the future, the Company may be required to incur additional bad debt expense with respect to trade receivables. The Company performs ongoing credit evaluations of its customers’ financial condition and generally requires no collateral to secure accounts receivable. The Company maintains an allowance for potential credit losses based upon expected collectibility risk of all accounts receivable. In addition, the Company may utilize letters of credit or non-recourse factoring to mitigate credit risk when considered appropriate. The Company is exposed to credit loss in the event of non-performance by counterparties on the foreign exchange contracts that the Company uses in hedging activities and in certain factoring transactions. These counterparties are large international financial institutions, and to date no such counterparty has failed to meet its financial obligations to the Company under such contracts. |
Foreign Currency | Foreign Currency. The functional currencies of KLA-Tencor’s foreign subsidiaries are the local currencies, except as described below. Accordingly, all assets and liabilities of these foreign operations are translated to U.S. dollars at current period end exchange rates, and revenues and expenses are translated to U.S. dollars using average exchange rates in effect during the period. The gains and losses from foreign currency translation of these subsidiaries’ financial statements are recorded directly into a separate component of stockholders’ equity under the caption “Accumulated other comprehensive income (loss).” The Company’s manufacturing subsidiaries in Singapore, Israel, Germany and China use the U.S. dollar as their functional currency. Accordingly, monetary assets and liabilities in non-functional currency of these subsidiaries are remeasured using exchange rates in effect at the end of the period. Revenues and costs in local currency are remeasured using average exchange rates for the period, except for costs related to those balance sheet items that are remeasured using historical exchange rates. The resulting remeasurement gains and losses are included in the Consolidated Statements of Operations as incurred. |
Derivative Financial Instruments | Derivative Financial Instruments. KLA-Tencor uses financial instruments, such as forward exchange contracts and currency options, to hedge a portion of, but not all, existing and forecasted foreign currency denominated transactions. The purpose of the Company’s foreign currency program is to manage the effect of exchange rate fluctuations on certain foreign currency denominated revenues, costs and eventual cash flows. The effect of exchange rate changes on forward exchange contracts is expected to offset the effect of exchange rate changes on the underlying hedged items. The Company believes these financial instruments do not subject the Company to speculative risk that would otherwise result from changes in currency exchange rates. All of the Company’s derivative financial instruments are recorded at fair value based upon quoted market prices for comparable instruments adjusted for risk of counterparty non-performance. For derivative instruments designated and qualifying as cash flow hedges of forecasted foreign currency denominated transactions expected to occur within twelve months, the effective portion of the gain or loss on these hedges is reported as a component of “Accumulated other comprehensive income (loss)” in stockholders’ equity, and is reclassified into earnings when the hedged transaction affects earnings. If the transaction being hedged fails to occur, or if a portion of any derivative is (or becomes) ineffective, the gain or loss on the associated financial instrument is recorded immediately in earnings. For derivative instruments used to hedge existing foreign currency denominated assets or liabilities, the gains or losses on these hedges are recorded immediately in earnings to offset the changes in the fair value of the assets or liabilities being hedged. |
Warranty | Warranty. The Company provides standard warranty coverage on its systems for 40 hours per week for 12 months, providing labor and parts necessary to repair the systems during the warranty period. The Company accounts for the estimated warranty cost as a charge to costs of revenues when revenue is recognized. The estimated warranty cost is based on historical product performance and field expenses. Utilizing actual service records, the Company calculates the average service hours and parts expense per system and applies the actual labor and overhead rates to determine the estimated warranty charge. The Company updates these estimated charges on a regular basis. The actual product performance and/or field expense profiles may differ, and in those cases the Company adjusts its warranty accruals accordingly (see Note 13, “Commitments and Contingencies”). |
Revenue Recognition | Revenue Recognition. The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the selling price is fixed or determinable, and collectibility is reasonably assured. The Company derives revenue from three sources-sales of systems, spare parts and services. In general, the Company recognizes revenue for systems when the system has been installed, is operating according to predetermined specifications and is accepted by the customer. When the Company has demonstrated a history of successful installation and acceptance, the Company recognizes revenue upon delivery and customer acceptance. Under certain circumstances, however, the Company recognizes revenue prior to acceptance from the customer, as follows: • When the customer fab has previously accepted the same tool, with the same specifications, and when the Company can objectively demonstrate that the tool meets all of the required acceptance criteria. • When system sales to independent distributors have no installation requirement, contain no acceptance agreement, and 100% payment is due based upon shipment. • When the installation of the system is deemed perfunctory. • When the customer withholds acceptance due to issues unrelated to product performance, in which case revenue is recognized when the system is performing as intended and meets predetermined specifications. In circumstances in which the Company recognizes revenue prior to installation, the portion of revenue associated with installation is deferred based on estimated fair value, and that revenue is recognized upon completion of the installation. In many instances, products are sold in stand-alone arrangements. Services are sold separately through renewals of annual maintenance contracts. The Company has multiple element revenue arrangements in cases where certain elements of a sales arrangement are not delivered and accepted in one reporting period. To determine the relative fair value of each element in a revenue arrangement, the Company allocates arrangement consideration based on the selling price hierarchy. For substantially all of the arrangements with multiple deliverables pertaining to products and services, the Company uses vendor-specific objective evidence (“VSOE”) or third-party evidence (“TPE”) to allocate the selling price to each deliverable. The Company determines TPE based on historical prices charged for products and services when sold on a stand-alone basis. When the Company is unable to establish relative selling price using VSOE or TPE, the Company uses estimated selling price (“ESP”) in its allocation of arrangement consideration. The objective of ESP is to determine the price at which the Company would transact a sale if the product or service were sold on a stand-alone basis. ESP could potentially be used for new or customized products. The Company regularly reviews relative selling prices and maintains internal controls over the establishment and updates of these estimates. In a multiple element revenue arrangement, the Company defers revenue recognition associated with the relative fair value of each undelivered element until that element is delivered to the customer. To be considered a separate element, the product or service in question must represent a separate unit of accounting, which means that such product or service must fulfill the following criteria: (a) the delivered item(s) has value to the customer on a stand-alone basis; and (b) if the arrangement includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in the control of the Company. If the arrangement does not meet all the above criteria, the entire amount of the sales contract is deferred until all elements are accepted by the customer. Trade-in rights are occasionally granted to customers to trade in tools in connection with subsequent purchases. The Company estimates the value of the trade-in right and reduces the revenue recognized on the initial sale. This amount is recognized at the earlier of the exercise of the trade-in right or the expiration of the trade-in right. Spare parts revenue is recognized when the product has been shipped, risk of loss has passed to the customer and collection of the resulting receivable is probable. Service and maintenance contract revenue is recognized ratably over the term of the maintenance contract. Revenue from services performed in the absence of a maintenance contract, including consulting and training revenue, is recognized when the related services are performed and collectibility is reasonably assured. The Company sells stand-alone software that is subject to the software revenue recognition guidance. The Company periodically reviews selling prices to determine whether VSOE exists, and in situations where the Company is unable to establish VSOE for undelivered elements, such as post-contract service, revenue is recognized ratably over the term of the service contract. The Company also defers the fair value of non-standard warranty bundled with equipment sales as unearned revenue. Non-standard warranty includes services incremental to the standard 40 -hour per week coverage for 12 months. Non-standard warranty is recognized ratably as revenue when the applicable warranty term period commences. The deferred system profit balance equals the amount of deferred system revenue that was invoiced and due on shipment, less applicable product and warranty costs. Deferred system revenue represents the value of products that have been shipped and billed to customers which have not met the Company’s revenue recognition criteria. Deferred system profit does not include the profit associated with product shipments to certain customers in Japan, to whom title does not transfer until customer acceptance. Shipments to such customers in Japan are classified as inventory at cost until the time of acceptance. |
Research and Development Costs | Research and Development Costs. Research and development costs are expensed as incurred. |
Strategic Development Agreements | Strategic Development Agreements. Gross engineering, research and development expenses were partially offset by $1.9 million , $8.2 million and $12.4 million in external funding received under certain strategic development programs, primarily from government grants, in the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. |
Shipping and Handling Costs | Shipping and Handling Costs. Shipping and handling costs are included as a component of cost of sales. |
Accounting for Stock-Based Compensation Plans | Accounting for Stock-Based Compensation Plans. The Company accounts for stock-based awards granted to employees for services based on the fair value of those awards. The fair value of stock-based awards is measured at the grant date and is recognized as expense over the employee’s requisite service period. The fair value for restricted stock units granted without “dividend equivalent” rights is determined using the closing price of the Company’s common stock on the grant date, adjusted to exclude the present value of dividends which are not accrued on the restricted stock units. The fair value for restricted stock units granted with “dividend equivalent” rights is determined using the closing price of the Company’s common stock on the grant date. The award holder is not entitled to received payments under dividend equivalent rights unless the associated restricted stock unit award vests (i.e., the award holder is entitled to receive credits, payable in cash or shares of the Company’s common stock, equal to the cash dividends that would have been received on the shares of common stock underlying the restricted stock units had the shares been issued and outstanding on the dividend record date, but such dividend equivalents are only paid subject to the recipient satisfying the vesting requirements of the underlying award). The fair value is determined using a Black-Scholes valuation model for purchase rights under the Employee Stock Purchase Plan. The Black-Scholes option-pricing model requires the input of assumptions, including the option’s expected term and the expected price volatility of the underlying stock. The expected stock price volatility assumption is based on the market-based historical implied volatility from traded options of the Company’s common stock. The Company has elected not to include the indirect tax effects of stock-based compensation deductions when calculating the windfall benefits and therefore recognizes the full effect of these deductions in the income statement in the period in which the taxable event occurs. |
Accounting for Cash-based Long-Term Incentive Compensation | Accounting for Cash-Based Long-Term Incentive Compensation. Cash-based long-term incentive (“Cash LTI”) awards issued to employees under the Company’s Cash LTI program vest in four equal installments, with 25% of the aggregate amount of the Cash LTI award vesting on each yearly anniversary of the grant date over a four -year period. In order to receive payments under a Cash LTI award, participants must remain employed by the Company as of the applicable award vesting date. Compensation expense related to the Cash LTI awards is recognized over the vesting term, which is adjusted for the impact of estimated forfeitures. |
Accounting for Non-qualified Deferred Compensation Plan | Accounting for Non-qualified Deferred Compensation Plan. The Company has a non-qualified deferred compensation plan (known as “Executive Deferred Savings Plan”) under which certain executives and non-employee directors may defer a portion of their compensation. Participants are credited with returns based on their allocation of their account balances among measurement funds. The Company controls the investment of these funds, and the participants remain general creditors of the Company. The Company invests these funds in certain mutual funds and such investments are classified as trading securities on the consolidated balance sheets. Distributions from the Executive Deferred Savings Plan commence following a participant’s retirement or termination of employment or on a specified date allowed per the Executive Deferred Savings Plan provisions, except in cases where such distributions are required to be delayed in order to avoid a prohibited distribution under Internal Revenue Code Section 409A. Participants can generally elect the distributions to be paid in lump sum or quarterly cash payments over a scheduled period for up to 15 years and are allowed to make subsequent changes to their existing elections as permissible under the Executive Deferred Savings Plan provisions. The liability associated with the Executive Deferred Savings Plan is included as a component of other current liabilities on the consolidated balance sheet. Changes in the Executive Deferred Savings Plan liability is recorded in selling, general and administrative expense in the consolidated statements of operations. The changes in the liability included in selling, general and administrative expense were $10.4 million , $24.4 million and $14.2 million for the fiscal years ended June 30, 2015 , 2014 and 2013 respectively. The Company also has a deferred compensation asset that corresponds to the liability under the Executive Deferred Savings Plan and it is included as a component of other non-current assets on the consolidated balance sheet. Changes in the Executive Deferred Savings Plan assets are recorded as gains (losses), net in selling, general and administrative expense in the consolidated statements of operations. The amount of gains (losses), net included in selling, general and administrative expense were $10.4 million , $24.8 million and $14.1 million for the fiscal years ended June 30, 2015 , 2014 and 2013 , respectively. |
Advertising Expenses | Advertising Expenses. Advertising costs are expensed as incurred. |
Income Taxes | Income Taxes. The Company accounts for income taxes in accordance with the authoritative guidance, which requires that deferred tax assets and liabilities be recognized using enacted tax rates for the effect of temporary differences between the book and tax bases of recorded assets and liabilities. The guidance also requires that deferred tax assets be reduced by a valuation allowance if it is more likely than not that certain deferred tax asset will not be realized. The Company has determined that a valuation allowance is necessary against certain deferred tax assets, but it anticipates that its future taxable income will be sufficient to recover the remainder of its deferred tax assets. However, should there be a change in the Company’s ability to recover its deferred tax assets that are not subject to a valuation allowance, the Company could be required to record an additional valuation allowance against such deferred tax assets. This would result in an increase to the Company’s tax provision in the period in which the Company determines that the recovery is not probable. The Company applies a two-step approach, based on authoritative guidance, to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained in audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit and new audit activity. Any change in these factors could result in the recognition of a tax benefit or an additional charge to the tax provision. |
Earnings Per Share | Earnings Per Share. Basic earnings per share (“EPS”) is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per share is calculated by using the weighted-average number of common shares outstanding during the period increased to include the number of additional shares of common stock that would have been outstanding if the dilutive potential shares of common stock had been issued. The dilutive effect of outstanding options and restricted stock units is reflected in diluted earnings per share by application of the treasury stock method. The dilutive securities are excluded from the computation of diluted net loss per share when a net loss is recorded for the period as their effect would be anti-dilutive. |
Contingencies and Litigation | Contingencies and Litigation. The Company is subject to the possibility of losses from various contingencies. Considerable judgment is necessary to estimate the probability and amount of any loss from such contingencies. An accrual is made when it is probable that a liability has been incurred or an asset has been impaired and the amount of loss can be reasonably estimated. The Company accrues a liability and recognizes as expense the estimated costs expected to be incurred over the next twelve months to defend or settle asserted and unasserted claims existing as of the balance sheet date. See Note 13, “Commitments and Contingencies” and Note 14, “Litigation and Other Legal Matters” for a detailed description. |
Reclassifications | Reclassifications. Certain reclassifications have been made to prior year financial statements to conform to the current year presentation. The reclassifications had no effect on the Consolidated Statements of Operations, Comprehensive Income, Stockholder’s Equity and Cash Flows. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Recently Adopted In July 2013, the Financial Accounting Standards Board (“FASB”) issued an accounting standard update that provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists. Under this accounting standard update, in most circumstances, an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the Company’s financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss or a tax credit carryforward. This accounting standard update became effective for the Company’s interim period ended September 30, 2014, and the adoption did not have a material impact on the Company’s consolidated financial statements. In June 2014, the FASB issued an accounting standard update regarding stock-based compensation that clarifies the accounting treatment when terms of an award provide that a performance target could be achieved after the requisite service period ends. The update requires that a performance target that affects vesting that could be achieved after the requisite service period ends be treated as a performance condition. The update is effective for the Company beginning in the first quarter of the Company’s fiscal year ending June 30, 2017, with early adoption permitted. The Company early adopted this accounting standard update in the third quarter of the fiscal year ended June 30, 2015 and the adoption did not have a material impact on the Company’s consolidated financial statements. In April 2015, the FASB issued accounting standards update regarding simplification of the presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The update is effective for the Company beginning in the first quarter of the fiscal year ending June 30, 2017. Earlier adoption is permitted for financial statements that have not been previously issued and the Company is required to apply the guidance on a retrospective basis with additional disclosure requirements upon transition. The Company early adopted this accounting standard update in the fourth quarter of our fiscal year ended June 30, 2015 and the adoption did not have a material impact on its consolidated financial statements. Updates Not Yet Effective In May 2014, the FASB issued an accounting standard update regarding revenue from customer contracts to transfer goods and services or non-financial assets unless the contracts are covered by other standards (for example, insurance or lease contracts). Under the new guidance, an entity should recognize revenue in connection with the transfer of promised goods or services to customers in an amount that reflects the consideration that the entity expects to be entitled to receive in exchange for those goods or services. In addition, the new standard requires that reporting companies disclose the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The updates are effective for the Company beginning in the first quarter of the fiscal year ending June 30, 2018. In July 2015, the FASB announced a deferral of the effective date by one year, with early adoption on the original effective date permitted. The new revenue standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. The Company is currently evaluating the impact of this accounting standard update on its consolidated financial statements. In April 2015, the FASB issued an accounting standard update for customer’s cloud based fees. The guidance changes what a customer must consider in determining whether a cloud computing arrangement contains a software license. If the arrangement contains a software license, the customer would account for the fees related to the software license element in accordance with guidance related to internal use software; if the arrangement does not contain a software license, the customer would account for the arrangement as a service contract. The update is effective for the Company beginning in the first quarter of the Company’s fiscal year ending June 30, 2017, with early adoption permitted. The Company is currently evaluating the impact of this accounting standard update on its consolidated financial statements. In July 2015, the FASB issued an accounting standard update for the subsequent measurement of inventory. The amended guidance requires entities to measure inventory at the lower of cost or net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal and transportation. The requirement would replace the current lower of cost or market evaluation and the accounting guidance is unchanged for inventory measured using last-in, first-out (“LIFO”) or the retail inventory method. The update is effective for the Company beginning in the first quarter of the Company’s fiscal year ending June 30, 2018, with early adoption permitted to be applied prospectively. The Company is currently evaluating the impact of this accounting standard update on its consolidated financial statements. |
Summary of Significant Accoun31
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Accounting Policies [Abstract] | |
Property, Plant and Equipment | The following table sets forth the estimated useful life for various asset categories: Asset Category Period Buildings 30 to 35 years Leasehold improvements Shorter of 10 to 15 years or lease term Machinery and equipment 2 to 5 years Office furniture and fixtures 5 to 7 years |
Schedule of Revenue and Account Receivable by Major Customers by Reporting Segments | The following customers each accounted for more than 10% of total revenues for the indicated periods: Year ended June 30, 2015 2014 2013 Intel Corporation Intel Corporation Intel Corporation Samsung Electronics Co., Ltd. Samsung Electronics Co., Ltd. Taiwan Semiconductor Manufacturing Company Limited Taiwan Semiconductor Manufacturing Company Limited Taiwan Semiconductor Manufacturing Company Limited The following customers each accounted for more than 10% of net accounts receivable as of the dates indicated below: As of June 30, 2015 2014 Taiwan Semiconductor Manufacturing Company Limited Intel Corporation Taiwan Semiconductor Manufacturing Company Limited |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | Financial assets (excluding cash held in operating accounts and time deposits) and liabilities measured at fair value on a recurring basis as of the date indicated below were presented on the Company’s Consolidated Balance Sheet as follows: As of June 30, 2015 (In thousands) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Assets Cash equivalents: U.S. Government agency securities $ 7,500 $ 7,500 $ — Corporate debt securities 13,099 — 13,099 Money market and other 611,385 611,385 — Marketable securities: U.S. Treasury securities 275,555 275,555 — U.S. Government agency securities 564,768 556,019 8,749 Municipal securities 31,816 — 31,816 Corporate debt securities 612,862 — 612,862 Sovereign securities 57,093 8,976 48,117 Total cash equivalents and marketable securities (1) 2,174,078 1,459,435 714,643 Other current assets: Derivative assets 3,064 — 3,064 Other non-current assets: Executive Deferred Savings Plan 165,655 91,203 74,452 Total financial assets (1) $ 2,342,797 $ 1,550,638 $ 792,159 Liabilities Other current liabilities: Derivative liabilities $ (3,106 ) $ — $ (3,106 ) Total financial liabilities $ (3,106 ) $ — $ (3,106 ) __________________ (1) Excludes cash of $183.1 million held in operating accounts and time deposits of $29.9 million as of June 30, 2015 . Financial assets (excluding cash held in operating accounts and time deposits) and liabilities measured at fair value on a recurring basis as of the date indicated below were presented on the Company’s Consolidated Balance Sheet as follows: As of June 30, 2014 (In thousands) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Assets Cash equivalents: U.S. Government agency securities $ 28,000 $ 8,000 $ 20,000 Municipal securities 2,891 — 2,891 Corporate debt securities 68,992 — 68,992 Money market and other 397,517 397,517 — Marketable securities: U.S. Treasury securities 384,400 365,401 18,999 U.S. Government agency securities 839,843 811,841 28,002 Municipal securities 93,325 — 93,325 Corporate debt securities 1,155,176 — 1,155,176 Sovereign securities 42,264 9,253 33,011 Total cash equivalents and marketable securities (1) 3,012,408 1,592,012 1,420,396 Other current assets: Derivative assets 666 — 666 Other non-current assets: Executive Deferred Savings Plan 159,995 105,311 54,684 Total financial assets (1) $ 3,173,069 $ 1,697,323 $ 1,475,746 Liabilities Other current liabilities: Derivative liabilities $ (898 ) $ — $ (898 ) Total financial liabilities $ (898 ) $ — $ (898 ) __________________ (1) Excludes cash of $106.7 million held in operating accounts and time deposits of $33.5 million as of June 30, 2014 . |
Financial Statement Components
Financial Statement Components (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Financial Statement Components [Abstract] | |
Condensed Balance Sheet | Consolidated Balance Sheets As of June 30, (In thousands) 2015 2014 Accounts receivable, net: Accounts receivable, gross $ 607,157 $ 514,690 Allowance for doubtful accounts (21,663 ) (21,827 ) $ 585,494 $ 492,863 Inventories: Customer service parts $ 209,726 $ 203,194 Raw materials 194,218 221,612 Work-in-process 156,820 171,249 Finished goods 57,140 60,402 $ 617,904 $ 656,457 Other current assets: Prepaid expenses (1) $ 37,006 $ 34,743 Income tax related receivables 32,850 27,452 Other current assets 7,958 6,267 $ 77,814 $ 68,462 Land, property and equipment, net: Land $ 40,397 $ 41,848 Buildings and leasehold improvements 316,566 302,537 Machinery and equipment 510,642 491,167 Office furniture and fixtures 21,411 20,945 Construction-in-process 3,152 8,945 892,168 865,442 Less: accumulated depreciation and amortization (577,577 ) (535,179 ) $ 314,591 $ 330,263 Other non-current assets: Executive Deferred Savings Plan $ 165,655 $ 159,996 Deferred tax assets—long-term 78,648 75,138 Other non-current assets (1) 15,384 21,302 $ 259,687 $ 256,436 Other current liabilities: Warranty $ 36,413 $ 37,746 Executive Deferred Savings Plan 167,886 160,527 Compensation and benefits 196,682 203,990 Income taxes payable 15,582 15,283 Interest payable 19,395 8,769 Customer credits and advances 93,212 79,373 Other accrued expenses 132,244 79,402 $ 661,414 $ 585,090 Other non-current liabilities: Pension liabilities $ 55,696 $ 59,908 Income taxes payable 69,018 59,575 Other non-current liabilities 57,516 48,805 $ 182,230 $ 168,288 __________________ (1) Other current assets and other non-current assets balances as of June 30, 2014 on the consolidated balance sheet were adjusted to exclude the debt issuance costs as a result of early adoption of the accounting standards update regarding simplification of the presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. See Note 7, “Debt” for additional details. |
Schedule of Accumulated Other Comprehensive Income (Loss) | The components of accumulated other comprehensive income (loss) (“OCI”) as of the dates indicated below were as follows: (In thousands) Currency Translation Adjustments Unrealized Gains (Losses) on Available-for-Sale Securities Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Defined Benefit Plans Total Balance as of June 30, 2015 $ (29,925 ) $ 734 $ 4,553 $ (15,935 ) $ (40,573 ) Balance as of June 30, 2014 $ (17,271 ) $ 2,800 $ (12 ) $ (15,788 ) $ (30,271 ) |
Reclassification out of Accumulated Other Comprehensive Income | The effects on net income of amounts reclassified from accumulated OCI to the Consolidated Statements of Operations for the indicated periods were as follows (in thousands): Location in the Consolidated Statements of Operations Twelve months ended Twelve months ended Accumulated OCI Components 2015 2014 Unrealized gains (losses) on cash flow hedges from foreign exchange and interest rate contracts Revenues $ 7,615 $ 3,851 Costs of revenues (1,503 ) 294 Interest expense 503 — Net gains reclassified from accumulated OCI $ 6,615 $ 4,145 Unrealized gains on available-for-sale securities Other expense (income), net $ 2,119 $ 2,084 |
Consolidated Statements of Operations | Consolidated Statements of Operations Year ended June 30, (In thousands) 2015 2014 2013 Other expense (income), net: Interest income $ (12,545 ) $ (13,555 ) $ (14,976 ) Foreign exchange losses, net 1,764 514 1,002 Net realized gains on sale of investments (2,119 ) (2,084 ) (2,287 ) Other 2,431 (1,078 ) 1,149 $ (10,469 ) $ (16,203 ) $ (15,112 ) |
Marketable Securities (Tables)
Marketable Securities (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Marketable Securities [Abstract] | |
Summary of Marketable Securities | The amortized cost and fair value of marketable securities as of the dates indicated below were as follows: As of June 30, 2015 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury securities $ 274,965 $ 605 $ (15 ) $ 275,555 U.S. Government agency securities 571,843 551 (126 ) 572,268 Municipal securities 31,819 7 (10 ) 31,816 Corporate debt securities 625,965 511 (515 ) 625,961 Money market and other 611,385 — — 611,385 Sovereign securities 57,091 33 (31 ) 57,093 Subtotal 2,173,068 1,707 (697 ) 2,174,078 Add: Time deposits (1) 29,941 — — 29,941 Less: Cash equivalents 654,933 — — 654,933 Marketable securities $ 1,548,076 $ 1,707 $ (697 ) $ 1,549,086 As of June 30, 2014 (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value U.S. Treasury securities $ 384,165 $ 287 $ (52 ) $ 384,400 U.S. Government agency securities 867,309 651 (117 ) 867,843 Municipal securities 96,198 93 (75 ) 96,216 Corporate debt securities 1,220,794 3,526 (152 ) 1,224,168 Money market and other 397,517 — — 397,517 Sovereign securities 42,227 46 (9 ) 42,264 Subtotal 3,008,210 4,603 (405 ) 3,012,408 Add: Time deposits (1) 33,509 — — 33,509 Less: Cash equivalents 524,149 — (8 ) 524,141 Marketable securities $ 2,517,570 $ 4,603 $ (397 ) $ 2,521,776 __________________ (1) Time deposits excluded from fair value measurements. |
Investments with Gross Unrealized Losses | The following table summarizes the fair value and gross unrealized losses of the Company’s investments that were in an unrealized loss position as of the date indicated below: As of June 30, 2015 (In thousands) Fair Value Gross Unrealized Losses (1) U.S. Treasury securities $ 34,508 $ (15 ) U.S. Government agency securities 133,933 (126 ) Municipal securities 9,776 (10 ) Corporate debt securities 286,355 (515 ) Sovereign securities 26,729 (31 ) Total $ 491,301 $ (697 ) __________________ (1) As of June 30, 2015 , the amount of total gross unrealized losses related to investments that had been in a continuous loss position for 12 months or more was immaterial. |
Contractual Maturities of Securities | The contractual maturities of securities classified as available-for-sale, regardless of their classification on the Company’s Consolidated Balance Sheet, as of the date indicated below were as follows: As of June 30, 2015 (In thousands) Amortized Cost Fair Value Due within one year $ 496,916 $ 497,121 Due after one year through three years 1,051,160 1,051,965 $ 1,548,076 $ 1,549,086 |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table represents the purchase price allocation and summarizes the aggregate fair values of the net assets acquired on the closing date of the acquisition: (In thousands) Purchase Price Allocation Intangibles $ 9,400 Goodwill 8,730 Liabilities assumed (130 ) Cash consideration paid $ 18,000 |
Goodwill and Purchased Intang36
Goodwill and Purchased Intangible Assets (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill Rollforward | The following table presents goodwill balances and the movements during the fiscal years ended June 30, 2015 and 2014 : (In thousands) As of June 30, 2013 $ 326,635 Acquisition 8,730 Adjustments (10 ) As of June 30, 2014 335,355 Adjustments (92 ) As of June 30, 2015 $ 335,263 |
Components of Purchased Intangible Assets | The components of purchased intangible assets as of the dates indicated below were as follows: (In thousands) As of June 30, 2015 As of June 30, 2014 Category Range of Useful Lives Gross Carrying Amount Accumulated Amortization and Impairment Net Amount Gross Carrying Amount Accumulated Amortization and Impairment Net Amount Existing technology 4-7 years $ 141,659 $ 134,664 $ 6,995 $ 141,659 $ 126,567 $ 15,092 Patents 6-13 years 57,648 56,998 650 57,648 54,398 3,250 Trade name/Trademark 4-10 years 19,893 18,899 994 19,893 17,427 2,466 Customer relationships 6-7 years 54,980 51,724 3,256 54,980 48,915 6,065 Other 0-1 year 17,299 17,299 — 17,299 16,475 824 Total $ 291,479 $ 279,584 $ 11,895 $ 291,479 $ 263,782 $ 27,697 |
Remaining Estimated Amortization Expense | Based on the intangible assets recorded as of June 30, 2015 , and assuming no subsequent additions to, or impairment of, the underlying assets, the remaining estimated annual amortization expense is expected to be as follows: Fiscal year ending June 30: Amortization (In thousands) 2016 $ 7,564 2017 2,806 2018 1,525 Total $ 11,895 |
Debt Debt (Tables)
Debt Debt (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Debt Long-term and Short-term Instruments | In addition, the Company is required to maintain the maximum leverage ratio as described in the Credit Agreement, on a quarterly basis, covering the trailing four consecutive fiscal quarters for the fiscal quarters as described below. Fiscal Quarters Ending Maximum Leverage Ratio June 30, 2015 4.25:1.00 September 30, 2015 and December 31, 2015 4.00:1.00 March 31, 2016 through September 30, 2016 3.75:1.00 December 31, 2016 and March 31, 2017 3.50:1.00 Thereafter 3.00:1.00 The following table summarizes the debt of the Company as of June 30, 2015 and June 30, 2014 : As of June 30, 2015 As of June 30, 2014 Amount (in thousands) Effective Interest Rate Amount Effective Interest Rate Fixed-rate 6.900% Senior notes due on May 1, 2018 $ — $ 750,000 7.001 % Fixed-rate 2.375% Senior notes due on November 1, 2017 250,000 2.396 % — Fixed-rate 3.375% Senior notes due on November 1, 2019 250,000 3.377 % — Fixed-rate 4.125% Senior notes due on November 1, 2021 500,000 4.128 % — Fixed-rate 4.650% Senior notes due on November 1, 2024 (1) 1,250,000 4.682 % — Fixed-rate 5.650% Senior notes due on November 1, 2034 250,000 5.670 % — Term loans 711,250 — Total debt 3,211,250 750,000 Unamortized discount (3,723 ) (2,081 ) Unamortized debt issuance costs (2) (17,111 ) (2,818 ) Total debt $ 3,190,416 $ 745,101 Reported as: Current portion of long-term debt $ 16,981 $ — Long-term debt 3,173,435 745,101 Total debt $ 3,190,416 $ 745,101 __________________ (1) The effective interest rate disclosed above for this series of Senior Notes excludes the impact of the treasury rate lock hedge discussed below. The effective interest rate including the impact of the treasury rate lock hedge was 4.626% . (2) The Company early adopted the accounting standard update regarding simplification of the presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Accordingly, the Company applied the accounting standard update on a retrospective basis by reclassifying the presentation of the debt issuance costs totaling $2.8 million which was originally included in other current and other non-current assets against the long-term debt on the Consolidated Balance Sheet as of June 30, 2014 . The change in the classification of the debt issuance costs reduced total assets and total liabilities by $2.8 million as of June 30, 2014 . There is no impact to the Company’s Consolidated Statements of Operations, Comprehensive Income, Stockholder’s Equity and Cash Flows for the fiscal year ended June 30, 2014 . |
Schedule of Principal Payments and Maturities of Long-term Debt | As of June 30, 2015 , future principal payments for long-term debt, including the current portion, are summarized as follows. Fiscal year ending June 30, Amount (In thousands) 2016 $ 17,500 2017 46,875 2018 315,625 2019 75,000 2020 756,250 Thereafter 2,000,000 Total payments $ 3,211,250 Future principal payments for the Company’s term loans (without giving effect for any prepayments made) as of June 30, 2015 , are as follows: Fiscal Quarters Ending Quarterly Payment (in thousands) June 30, 2015 through December 31, 2016 $ 9,375 March 31, 2017 through December 31, 2017 $ 14,063 March 31, 2018 through September 30, 2019 $ 18,750 December 31, 2019 $ 487,500 |
Equity and Long-Term Incentiv38
Equity and Long-Term Incentive Compensation Plans (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Share-based Compensation [Abstract] | |
Schedule of Combined Activity Under Equity Incentive Plan | The following table summarizes the combined activity under the Company’s equity incentive plans for the indicated periods: (In thousands) Available For Grant Balances as of June 30, 2012 7,969 Restricted stock units granted (1)(3) (1,899 ) Restricted stock units canceled (1) 466 Options canceled/expired/forfeited 207 Plan shares expired (2) (47 ) Balances as of June 30, 2013 6,696 Plan shares increased 2,900 Restricted stock units granted (1)(3) (1,268 ) Restricted stock units canceled (1) 468 Options canceled/expired/forfeited 59 Plan shares expired (2) (51 ) Balances as of June 30, 2014 8,804 Restricted stock units granted (1)(3) (1,191 ) Restricted stock units canceled (1) 196 Options granted/canceled/expired/forfeited 11 Plan shares expired (2) (10 ) Balances as of June 30, 2015 (4) 7,810 __________________ (1) The number of restricted stock units provided in this row reflects the application of the award multiplier as described above ( 1.8 x or 2.0 x depending on the grant date of the applicable award). (2) Represents the portion of shares listed as “Options canceled/expired/forfeited” above that were issued under the Company’s equity incentive plans other than the 2004 Plan and the Outside Director Plan. Because the Company is only currently authorized to issue equity awards under the 2004 Plan and the Outside Director Plan, any equity awards that are canceled, expired or forfeited under any other Company equity incentive plan do not result in additional shares being available to the Company for future grant. (3) Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015 , it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units granted during such fiscal year, reported at the maximum possible number of shares that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum levels and all applicable service-based criteria are fully satisfied (i.e., 0.6 million shares for the fiscal year ended June 30, 2013, 0.6 million shares for the fiscal year ended June 30, 2014 and 0.6 million shares for the fiscal year ended June 30, 2015 , which, in each case reflects the application of the 1.8 x or 2.0 x multiplier described above). The Company has granted only restricted stock units under its equity incentive program since October 2007, except the number of shares subject to outstanding options under the 2004 Plan was adjusted during the three months ended December 31, 2014 due to a proportionate and equitable adjustment under the 2004 Plan provisions as discussed below. For the preceding several years until October 31, 2007, stock options were granted at the market price of the Company’s common stock on the date of grant generally with vesting period terms ranging from one to five years . Restricted stock units may be granted with varying criteria such as service-based and/or performance-based vesting. (4) During the fiscal year ended June 30, 2015 , the Company adjusted the number of shares subject to outstanding options under the 2004 Plan by an aggregate of 4,245 shares pursuant to a proportionate and equitable adjustment for the effect of the special cash dividend, as required by the 2004 Plan. The total number of outstanding options under the 2004 Plan as well as the associated exercise prices were adjusted to ensure the aggregate intrinsic value remained the same after considering the effect of the special cash dividend. As the adjustment was required by the 2004 Plan, under the authoritative guidance, the adjustment to the outstanding awards did not result in any incremental compensation expense. Additionally, the adjustment did not have an impact on the shares available for future issuance under the 2004 Plan. |
Schedule of Stock-Based Compensation Expense | The following table shows pre-tax stock-based compensation expense for the indicated periods: Year ended June 30, (In thousands) 2015 2014 2013 Stock-based compensation expense by: Costs of revenues $ 7,242 $ 9,101 $ 11,433 Engineering, research and development 12,259 16,397 19,346 Selling, general and administrative 35,801 35,442 39,305 Total stock-based compensation expense $ 55,302 $ 60,940 $ 70,084 |
Schedule of Stock-Based Compensation Capitalized as Inventory | The following table shows stock-based compensation capitalized as inventory as of the dates indicated below: (In thousands) As of June 30, 2015 2014 Inventory $ 3,242 $ 8,278 |
Schedule of Stock Option Activity | The following table summarizes the activity and weighted-average exercise price for stock options under all plans during the fiscal year ended June 30, 2015 : Stock Options Shares (In thousands) Weighted-Average Exercise Price Outstanding stock options as of June 30, 2014 141 $ 40.70 Granted 4 $ 32.11 Exercised (134 ) $ 39.32 Canceled/expired/forfeited (11 ) $ 39.97 Outstanding stock options as of June 30, 2015 (all outstanding and all vested and exercisable) — $ — |
Schedule of Intrinsic Value, Cash Received and Tax Benefits for Stock Option Exercises | The following table shows the total intrinsic value of options exercised, total cash received from employees and non-employee Board members as a result of stock option exercises and tax benefits realized by the Company in connection with these stock option exercises for the indicated periods: (In thousands) Year ended June 30, 2015 2014 2013 Total intrinsic value of options exercised $ 4,549 $ 18,022 $ 15,884 Total cash received from employees and non-employee Board members as a result of stock option exercises $ 5,892 $ 72,700 $ 89,935 Tax benefits realized by the Company in connection with these exercises $ 1,989 $ 5,708 $ 5,223 |
Schedule of Restricted Stock Units Activity | The following table shows the applicable number of restricted stock units and weighted-average grant date fair value for restricted stock units granted, vested and released, withheld for taxes, and forfeited during the fiscal year ended June 30, 2015 and restricted stock units outstanding as of June 30, 2015 and 2014 : Restricted Stock Units Shares (In thousands) (1) Weighted-Average Grant Date Fair Value Outstanding restricted stock units as of June 30, 2014 (2) 3,356 $ 38.95 Granted (2) 596 $ 74.48 Vested and released (765 ) $ 32.50 Withheld for taxes (405 ) $ 32.50 Forfeited (108 ) $ 38.90 Outstanding restricted stock units as of June 30, 2015 (2) 2,674 $ 49.36 __________________ (1) Share numbers reflect actual shares subject to awarded restricted stock units. As described above, under the terms of the 2004 Plan, the number of shares subject to each award reflected in this number is multiplied by either 1.8 x or 2.0 x (depending on the grant date of the award) to calculate the impact of the award on the share reserve under the 2004 Plan. (2) Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015 , it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units, reported at the maximum possible number of shares (i.e., 0.3 million shares for the fiscal year ended June 30, 2013, 0.3 million shares for the fiscal year ended June 30, 2014 and 0.3 million shares for the fiscal year ended June 30, 2015 ) that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum and all applicable service-based criteria are fully satisfied . |
Schedule of Tax Benefits and Grant Date Fair Value for Restricted Stock Units [Table Text Block] | The following table shows the weighted-average grant date fair value per unit for the restricted stock units granted and tax benefits realized by the Company in connection with vested and released restricted stock units for the indicated periods: (In thousands, except for weighted-average grant date fair value) Year ended June 30, 2015 2014 2013 Weighted-average grant date fair value per unit $ 74.48 $ 53.28 $ 47.71 Tax benefits realized by the Company in connection with vested and released restricted stock units $ 26,250 $ 44,298 $ 29,204 |
Schedule of Employee Stock Purchase Plan | The fair value of each purchase right under the ESPP was estimated on the date of grant using the Black-Scholes option valuation model and the straight-line attribution approach with the following weighted-average assumptions: Year ended June 30, 2015 2014 2013 Stock purchase plan: Expected stock price volatility 24.5 % 27.5 % 28.8 % Risk-free interest rate 0.1 % 0.1 % 0.1 % Dividend yield 2.8 % 2.9 % 3.2 % Expected life (in years) 0.50 0.50 0.50 |
Schedule of Cash Received, Number of Shares Purchased, Tax Benefits and Weighted-Average Fair Value for the ESPP | The following table shows total cash received from employees for the issuance of shares under the ESPP, the number of shares purchased by employees through the ESPP, the tax benefits realized by the Company in connection with the disqualifying dispositions of shares purchased under the ESPP and the weighted-average fair value per share for the indicated periods: (In thousands, except for weighted-average fair value per share) Year ended June 30, 2015 2014 2013 Total cash received from employees for the issuance of shares under the ESPP $ 41,116 $ 39,675 $ 36,186 Number of shares purchased by employees through the ESPP 759 796 877 Tax benefits realized by the Company in connection with the disqualifying dispositions of shares purchased under the ESPP $ 1,741 $ 2,221 $ 1,452 Weighted-average fair value per share based on Black-Scholes model $ 14.55 $ 12.31 $ 10.46 |
Stock Repurchase Program (Table
Stock Repurchase Program (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Stock Repurchase Program [Abstract] | |
Schedule of Share Repurchases | Share repurchases for the indicated periods (based on the trade date of the applicable repurchase) were as follows: (In thousands) Year ended June 30, 2015 2014 Number of shares of common stock repurchased 9,255 3,835 Total cost of repurchases $ 608,856 $ 240,843 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Income Per Share | The following table sets forth the computation of basic and diluted net income per share: (In thousands, except per share amounts) Year ended June 30, 2015 2014 2013 Numerator: Net income $ 366,158 $ 582,755 $ 543,149 Denominator: Weighted-average shares-basic, excluding unvested restricted stock units 162,282 166,016 166,089 Effect of dilutive options and restricted stock units 1,419 2,102 3,171 Weighted-average shares-diluted 163,701 168,118 169,260 Basic net income per share $ 2.26 $ 3.51 $ 3.27 Diluted net income per share $ 2.24 $ 3.47 $ 3.21 Anti-dilutive securities excluded from the computation of diluted net income per share 36 — 1,366 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Postemployment Benefits [Abstract] | |
Summary Data Related to Foreign Defined Benefit Pension Plans | Summary data relating to the Company’s foreign defined benefit pension plans, including key weighted-average assumptions used, is provided in the following tables: Year ended June 30, (In thousands) 2015 2014 Change in projected benefit obligation: Projected benefit obligation as of the beginning of the fiscal year $ 77,035 $ 71,276 Service cost 3,905 4,054 Interest cost 1,562 1,401 Contributions by plan participants 81 102 Actuarial loss 3,702 1,927 Benefit payments (3,982 ) (1,910 ) Foreign currency exchange rate changes and others, net (6,375 ) 185 Projected benefit obligation as of the end of the fiscal year $ 75,928 $ 77,035 Year ended June 30, (In thousands) 2015 2014 Change in fair value of plan assets: Fair value of plan assets as of the beginning of the fiscal year $ 15,163 $ 13,317 Actual return on plan assets 334 274 Employer contributions 3,568 3,229 Benefit and expense payments (3,982 ) (1,910 ) Foreign currency exchange rate changes and others, net 1,955 253 Fair value of plan assets as of the end of the fiscal year $ 17,038 $ 15,163 As of June 30, (In thousands) 2015 2014 Underfunded status $ 58,890 $ 61,872 As of June 30, (In thousands) 2015 2014 Plans with accumulated benefit obligations in excess of plan assets: Accumulated benefit obligation $ 46,419 $ 47,122 Projected benefit obligation $ 75,928 $ 77,035 Plan assets at fair value $ 17,038 $ 15,163 |
Weighted-Average Assumptions Used in Determining Benefit Obligation and Net Periodic Cost | Year ended June 30, 2015 2014 2013 Weighted-average assumptions: Discount rate 1.3%-2.0% 1.5%-3.5% 1.5%-3.5% Expected rate of return on assets 1.8%-2.5% 1.8%-3.8% 1.8%-4.0% Rate of compensation increases 3.0%-5.5% 3.0%-5.5% 3.0%-5.0% |
Defined Benefit Plan Amounts Recognized in Other Comprehensive Income (Loss) | The following table presents losses recognized in accumulated other comprehensive income (loss) before tax related to the Company’s foreign defined benefit pension plans: Year ended June 30, (In thousands) 2015 2014 Unrecognized transition obligation $ 515 $ 772 Unrecognized prior service cost 180 225 Unrealized net loss 24,119 23,645 Amount of losses recognized $ 24,814 $ 24,642 |
Amounts in Other Comprehensive Income (Loss) Expected to be Recognized as Net Periodic Benefit | Losses in accumulated other comprehensive income (loss) related to the Company’s foreign defined benefit pension plans expected to be recognized as components of net periodic benefit cost over the fiscal year ending June 30, 2016 are as follows: (In thousands) Year ending June 30, 2016 Unrecognized transition obligation $ 255 Unrecognized prior service cost 42 Unrealized net loss 824 Amount of losses expected to be recognized $ 1,121 |
Components of Net Periodic Cost | The components of the Company’s net periodic cost relating to its foreign subsidiaries’ defined pension plans are as follows: Year ended June 30, (In thousands) 2015 2014 2013 Components of net periodic pension cost: Service cost $ 3,905 $ 4,054 $ 3,399 Interest cost 1,562 1,401 1,320 Return on plan assets (450 ) (321 ) (315 ) Amortization of transitional obligation 259 262 372 Amortization of prior service cost 46 52 58 Amortization of net loss 1,014 1,021 633 Adjustment (177 ) — (1,436 ) Net periodic pension cost $ 6,159 $ 6,469 $ 4,031 |
Foreign Plan Assets Measured at Fair Value on Recurring Basis | Foreign plan assets measured at fair value on a recurring basis consisted of the following investment categories as of June 30, 2015 and 2014 , respectively: As of June 30, 2015 (In thousands) Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Cash and cash equivalents $ 10,954 $ 10,954 $ — Bonds, equity securities and other investments 6,084 — 6,084 Total assets measured at fair value $ 17,038 $ 10,954 $ 6,084 As of June 30, 2014 (In thousands) Total Quoted Prices in Significant Other Cash and cash equivalents $ 11,061 $ 11,061 $ — Bonds, equity securities and other investments 4,102 — 4,102 Total assets measured at fair value $ 15,163 $ 11,061 $ 4,102 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Taxes, Domestic and Foreign | The components of income before income taxes are as follows: Year ended June 30, (In thousands) 2015 2014 2013 Domestic income before income taxes $ 157,251 $ 434,336 $ 420,862 Foreign income before income taxes 276,880 300,125 269,759 Total income before income taxes $ 434,131 $ 734,461 $ 690,621 |
Schedule of Components of Income Tax Expense (Benefit) | The provision for income taxes is comprised of the following: (In thousands) Year ended June 30, 2015 2014 2013 Current: Federal $ 63,123 $ 98,937 $ 118,888 State 3,655 8,580 4,404 Foreign 25,438 27,867 25,112 92,216 135,384 148,404 Deferred: Federal (22,390 ) 22,904 (2,552 ) State 409 (334 ) (1,036 ) Foreign (2,262 ) (6,248 ) 2,656 (24,243 ) 16,322 (932 ) Provision for income taxes $ 67,973 $ 151,706 $ 147,472 |
Schedule of Deferred Tax Assets and Liabilities | The significant components of deferred income tax assets and liabilities are as follows: (In thousands) As of June 30, 2015 2014 Deferred tax assets: Tax credits and net operating losses $ 108,615 $ 95,492 Employee benefits accrual 99,472 97,308 Stock-based compensation 18,722 17,676 Capitalized R&D expenses 47 12,051 Inventory reserves 92,649 83,783 Non-deductible reserves 47,176 41,469 Depreciation and amortization 13,267 2,572 Unearned revenue 16,150 13,937 Other 28,784 29,483 Gross deferred tax assets 424,882 393,771 Valuation allowance (91,350 ) (76,328 ) Net deferred tax assets $ 333,532 $ 317,443 Deferred tax liabilities: Unremitted earnings of foreign subsidiaries not permanently reinvested $ (12,775 ) $ (17,334 ) Deferred profit (7,372 ) (16,358 ) Unrealized gain on investments (2,673 ) (1,168 ) Total deferred tax liabilities (22,820 ) (34,860 ) Total net deferred tax assets $ 310,712 $ 282,583 |
Schedule of Effective Income Tax Rate Reconciliation | The reconciliation of the United States federal statutory income tax rate to KLA-Tencor’s effective income tax rate is as follows: Year ended June 30, 2015 2014 2013 Federal statutory rate 35.0 % 35.0 % 35.0 % State income taxes, net of federal benefit 0.7 % 0.7 % 0.3 % Effect of foreign operations taxed at various rates (15.3 )% (11.5 )% (9.6 )% Research and development tax credit (3.7 )% (1.5 )% (3.1 )% Net change in tax reserves 1.5 % 0.3 % 1.7 % Domestic manufacturing benefit (2.1 )% (1.4 )% (1.6 )% Effect of stock-based compensation 0.8 % 0.4 % (0.3 )% Other (1.2 )% (1.3 )% (1.0 )% Effective income tax rate 15.7 % 20.7 % 21.4 % |
Summary of Income Tax Contingencies | A reconciliation of gross unrecognized tax benefits is as follows: Year ended June 30, (In thousands) 2015 2014 2013 Unrecognized tax benefits at the beginning of the year $ 59,575 $ 59,494 $ 50,839 Increases for tax positions taken in prior years 1,245 551 2,701 Decreases for tax positions taken in prior years (7 ) (764 ) (905 ) Increases for tax positions taken in current year 11,634 11,585 12,709 Decreases for settlements with taxing authorities — (3,601 ) (3,907 ) Decreases for lapsing of statutes of limitations (3,429 ) (7,690 ) (1,943 ) Unrecognized tax benefits at the end of the year $ 69,018 $ 59,575 $ 59,494 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Receivables Sold Under Factoring Agreements | The following table shows total receivables sold under factoring agreements and proceeds from sales of LCs for the indicated periods: Year ended June 30, (In thousands) 2015 2014 Receivables sold under factoring agreements $ 137,285 $ 116,292 Proceeds from sales of LCs $ 6,920 $ 8,323 |
Schedule of Future Minimum Rental Payments for Operating Leases | The following is a schedule of expected operating lease payments: Fiscal year ending June 30, Amount (In thousands) 2016 $ 8,008 2017 5,818 2018 3,964 2019 1,815 2020 1,220 2021 and thereafter 556 Total minimum lease payments $ 21,381 |
Changes in Product Warranty Liability | The following table provides the changes in the product warranty accrual for the indicated periods: Year ended June 30, (In thousands) 2015 2014 Beginning balance $ 37,746 $ 42,603 Accruals for warranties issued during the period 39,368 45,540 Changes in liability related to pre-existing warranties (572 ) (8,462 ) Settlements made during the period (40,129 ) (41,935 ) Ending balance $ 36,413 $ 37,746 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Restructuring Charges [Abstract] | |
Changes in Liability Related to Restructuring Activities | The following table shows the activity primarily related to accrual for severance and benefits for the fiscal years ended June 30, 2015 and 2014 : Year ended June 30, (In thousands) 2015 2014 Beginning balance $ 2,329 $ 3,947 Restructuring costs 31,569 6,662 Adjustments 1,177 (459 ) Cash payments (10,188 ) (7,821 ) Ending balance $ 24,887 $ 2,329 |
Derivative Instruments and He45
Derivative Instruments and Hedging Activities (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Schedule of Derivative Instruments, Location, Designated and Non-Designated, Gains (Losses) | The locations and amounts of designated and non-designated derivative instruments’ gains and losses reported in the consolidated financial statements for the indicated periods were as follows: (In thousands) Location in Financial Statements Year ended June 30, 2015 2014 Derivatives Designated as Hedging Instruments Gains in accumulated OCI on derivatives (effective portion) Accumulated OCI $ 13,745 $ 1,641 Gains reclassified from accumulated OCI into income (effective portion): Revenues $ 7,615 $ 3,851 Costs of revenues (1,503 ) 294 Interest expense 503 — Net gains reclassified from accumulated OCI into income (effective portion) $ 6,615 $ 4,145 Gains recognized in income on derivatives (ineffective portion and amount excluded from effectiveness testing) Other expense (income), net $ 243 $ 18 Derivatives Not Designated as Hedging Instruments Gains recognized in income Other expense (income), net $ 13,976 $ 2,856 Loss on extinguishment of debt and other, net $ 1,180 $ — |
Schedule of Notional Amounts of Derivatives Outstanding | The U.S. dollar equivalent of all outstanding notional amounts of hedge contracts, with maximum maturity of 16 months , as of the dates indicated below was as follows: (In thousands) As of As of Cash flow hedge contracts Purchase $ 32,775 $ 6,066 Sell $ 88,800 $ 33,999 Other foreign currency hedge contracts Purchase $ 64,012 $ 108,901 Sell $ 123,091 $ 106,322 |
Schedule of Derivative Instruments, Fair Value | The locations and fair value amounts of the Company’s derivative instruments reported in its Consolidated Balance Sheets as of the dates indicated below were as follows: Asset Derivatives Liability Derivatives Balance Sheet Location As of As of Balance Sheet Location As of As of (In thousands) Fair Value Fair Value Derivatives designated as hedging instruments Foreign exchange contracts Other current assets $ 1,722 $ 120 Other current liabilities $ 1,920 $ 100 Total derivatives designated as hedging instruments 1,722 120 1,920 100 Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets 1,342 546 Other current liabilities 1,186 798 Total derivatives not designated as hedging instruments 1,342 546 1,186 798 Total derivatives $ 3,064 $ 666 $ 3,106 $ 898 |
Balances and Changes in Accumulated Other Comprehensive Income Related to Derivative Instruments | The following table provides the balances and changes in accumulated OCI, before taxes, related to derivative instruments for the indicated periods: Year ended June 30, (In thousands) 2015 2014 Beginning balance $ (20 ) $ 2,484 Amount reclassified to income (6,615 ) (4,145 ) Net change in unrealized gains or losses 13,745 1,641 Ending balance $ 7,110 $ (20 ) |
Offsetting of Derivative Assets and Liabilities | As of June 30, 2015 and 2014 , information related to the offsetting arrangements was as follows (in thousands): As of June 30, 2015 Gross Amounts of Derivatives Not Offset in the Consolidated Balance Sheets Description Gross Amounts of Derivatives Gross Amounts of Derivatives Offset in the Consolidated Balance Sheets Net Amount of Derivatives Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives - Assets $ 3,064 $ — $ 3,064 $ (2,809 ) $ — $ 255 Derivatives - Liabilities $ (3,106 ) $ — $ (3,106 ) $ 2,809 $ — $ (297 ) As of June 30, 2014 Gross Amounts of Derivatives Not Offset in the Consolidated Balance Sheets Description Gross Amounts of Derivatives Gross Amounts of Derivatives Offset in the Consolidated Balance Sheets Net Amount of Derivatives Presented in the Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount Derivatives - Assets $ 666 $ — $ 666 $ (423 ) $ — $ 243 Derivatives - Liabilities $ (898 ) $ — $ (898 ) $ 423 $ — $ (475 ) |
Segment Reporting and Geograp46
Segment Reporting and Geographic Information (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Segment Reporting Information, Additional Information [Abstract] | |
Summary of Revenues by Geographic Region | The following is a summary of revenues by geographic region, based on ship-to location, for the indicated periods (as a percentage of total revenues): (Dollar amounts in thousands) Year ended June 30, 2015 2014 2013 Revenues: North America $ 815,914 29 % $ 705,159 24 % $ 846,125 30 % Taiwan 691,482 25 % 741,470 25 % 936,445 33 % Japan 426,963 15 % 334,653 11 % 310,204 11 % Europe & Israel 194,670 7 % 306,779 11 % 211,121 7 % Korea 405,320 14 % 371,139 13 % 292,724 10 % Rest of Asia 279,700 10 % 470,208 16 % 246,162 9 % Total $ 2,814,049 100 % $ 2,929,408 100 % $ 2,842,781 100 % |
Summary of Revenues by Major Products | The following is a summary of revenues by major products for the indicated periods (as a percentage of total revenues): (Dollar amounts in thousands) Year ended June 30, 2015 2014 2013 Revenues: Defect inspection $ 1,541,422 55 % $ 1,685,114 58 % $ 1,594,128 56 % Metrology 492,175 18 % 532,002 18 % 540,835 19 % Service 688,653 24 % 642,971 22 % 595,634 21 % Other 91,799 3 % 69,321 2 % 112,184 4 % Total $ 2,814,049 100 % $ 2,929,408 100 % $ 2,842,781 100 % |
Long-Lived Assets by Geographic Region | Long-lived assets by geographic region as of the dates indicated below were as follows: As of June 30, (In thousands) 2015 2014 Long-lived assets: United States $ 207,779 $ 219,280 Europe 16,536 19,527 Singapore 45,444 48,938 Israel 33,841 33,388 Rest of Asia 10,991 9,130 Total $ 314,591 $ 330,263 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Related Party Transaction, Due from (to) Related Party [Abstract] | |
Related Party Transactions | The following table provides the transactions with these parties for the indicated periods (for the portion of the period during which they were considered related): Year ended June 30, (In thousands) 2015 2014 2013 Total revenues $ 1,856 $ 2,701 $ 6,854 Total purchases $ 1,098 $ 2,622 $ 4,460 |
Quarterly Consolidated Result48
Quarterly Consolidated Results of Operations (Unaudited) (Tables) | 12 Months Ended |
Jun. 30, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Quarterly Financial Information | The following is a summary of the Company’s quarterly consolidated results of operations (unaudited) for the fiscal years ended June 30, 2015 and 2014 . (In thousands, except per share data) First quarter ended September 30, 2014 Second quarter ended December 31, 2014 Third quarter ended March 31, 2015 Fourth quarter ended June 30, 2015 Total revenues $ 642,901 $ 676,357 $ 738,459 $ 756,332 Gross margin $ 354,434 $ 393,144 $ 418,177 $ 433,065 Net income $ 72,233 $ 20,268 $ 131,638 $ 142,019 Net income per share: Basic (1) $ 0.44 $ 0.12 $ 0.81 $ 0.90 Diluted (1) $ 0.43 $ 0.12 $ 0.81 $ 0.89 (In thousands, except per share data) First quarter ended September 30, 2013 Second quarter ended December 31, 2013 Third quarter ended March 31, 2014 Fourth quarter ended June 30, 2014 Total revenues $ 658,337 $ 705,129 $ 831,599 $ 734,343 Gross margin $ 380,680 $ 419,315 $ 488,773 $ 407,678 Net income $ 111,197 $ 139,246 $ 203,581 $ 128,731 Net income per share: Basic (1) $ 0.67 $ 0.84 $ 1.22 $ 0.78 Diluted (1) $ 0.66 $ 0.83 $ 1.21 $ 0.77 __________________ (1) Basic and diluted earnings per share are computed independently for each of the quarters presented based on the weighted-average basic and fully diluted shares outstanding for each quarter. Therefore, the sum of quarterly basic and diluted per share information may not equal annual basic and diluted earnings per share. |
Summary of Significant Accoun49
Summary of Significant Accounting Policies (Details) $ in Millions | 12 Months Ended | ||
Jun. 30, 2015USD ($)hInstallmentcustomerRevenue_source | Jun. 30, 2014USD ($)customer | Jun. 30, 2013USD ($)customer | |
Summary of Significant Accounting Policies | |||
Depreciation expense | $ 55.8 | $ 51.1 | $ 49.3 |
Number of customers with significant revenue | customer | 3 | 3 | 2 |
Number of customers with significant accounts receivable balance | customer | 1 | 2 | 2 |
Standard warranty coverage, hours per week | h | 40 | ||
Standard warranty coverage, in months | 12 months | ||
Number of revenue sources | Revenue_source | 3 | ||
R&D external funding received under certain strategic development programs, primarily from government grants, to offset costs incurred | $ 1.9 | $ 8.2 | $ 12.4 |
Non-qualified deferred compensation plan payout period (in years) | 15 years | ||
Selling, General and Administrative Expenses | |||
Summary of Significant Accounting Policies | |||
Executive deferred compensation program, compensation expense | $ 10.4 | 24.4 | 14.2 |
Gain (loss), net on deferred compensation plan assets | $ 10.4 | 24.8 | $ 14.1 |
Cash Long-Term Incentive Plan | |||
Summary of Significant Accounting Policies | |||
Cash long-term incentive plan, equal vesting installments | Installment | 4 | ||
Cash long-term incentive plan, percentage of equal vesting installments | 25.00% | ||
Cash long-term incentive plan, vesting period (in years) | 4 years | ||
Executive deferred compensation program, compensation expense | $ 39.6 | $ 26.2 | |
Buildings | Minimum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 30 years | ||
Buildings | Maximum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 35 years | ||
Leasehold improvements (shorter of 10 to 15 years or lease term) | Minimum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 10 years | ||
Leasehold improvements (shorter of 10 to 15 years or lease term) | Maximum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 15 years | ||
Machinery and equipment | Minimum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 2 years | ||
Machinery and equipment | Maximum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 5 years | ||
Office furniture and fixtures | Minimum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 5 years | ||
Office furniture and fixtures | Maximum | |||
Summary of Significant Accounting Policies | |||
Land, property, and equipment, useful life | 7 years | ||
Total Revenue | |||
Summary of Significant Accounting Policies | |||
Concentration risk, percentage | 10.00% | ||
Accounts Receivable | |||
Summary of Significant Accounting Policies | |||
Concentration risk, percentage | 10.00% |
Fair Value Measurements (Detail
Fair Value Measurements (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 | |||
Fair Value Measurements | |||||
Total cash equivalents and marketable securities | $ 2,174,078 | [1] | $ 3,012,408 | [2] | |
Derivative assets | 3,064 | 666 | |||
Executive Deferred Savings Plan | 165,655 | 159,995 | |||
Total assets measured at fair value | 2,342,797 | [1] | 3,173,069 | [2] | |
Derivative liabilities | (3,106) | (898) | |||
Total financial liabilities | (3,106) | (898) | |||
Cash excluded from fair value measurement | 183,100 | 106,700 | |||
Time deposits excluded from fair value measurement | [3] | 29,941 | 33,509 | ||
U.S. Treasury securities | |||||
Fair Value Measurements | |||||
Marketable securities: | 275,555 | 384,400 | |||
U.S. Government agency securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 7,500 | 28,000 | |||
Marketable securities: | 564,768 | 839,843 | |||
Municipal securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 2,891 | ||||
Marketable securities: | 31,816 | 93,325 | |||
Corporate debt securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 13,099 | 68,992 | |||
Marketable securities: | 612,862 | 1,155,176 | |||
Money market and other | |||||
Fair Value Measurements | |||||
Cash equivalents: | 611,385 | 397,517 | |||
Sovereign securities | |||||
Fair Value Measurements | |||||
Marketable securities: | 57,093 | 42,264 | |||
Level 1 | |||||
Fair Value Measurements | |||||
Total cash equivalents and marketable securities | 1,459,435 | [1] | 1,592,012 | [2] | |
Derivative assets | 0 | 0 | |||
Executive Deferred Savings Plan | 91,203 | 105,311 | |||
Total assets measured at fair value | 1,550,638 | [1] | 1,697,323 | [2] | |
Derivative liabilities | 0 | 0 | |||
Total financial liabilities | 0 | 0 | |||
Level 1 | U.S. Treasury securities | |||||
Fair Value Measurements | |||||
Marketable securities: | 275,555 | 365,401 | |||
Level 1 | U.S. Government agency securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 7,500 | 8,000 | |||
Marketable securities: | 556,019 | 811,841 | |||
Level 1 | Municipal securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 0 | ||||
Marketable securities: | 0 | 0 | |||
Level 1 | Corporate debt securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 0 | 0 | |||
Marketable securities: | 0 | 0 | |||
Level 1 | Money market and other | |||||
Fair Value Measurements | |||||
Cash equivalents: | 611,385 | 397,517 | |||
Level 1 | Sovereign securities | |||||
Fair Value Measurements | |||||
Marketable securities: | 8,976 | 9,253 | |||
Level 2 | |||||
Fair Value Measurements | |||||
Total cash equivalents and marketable securities | 714,643 | [1] | 1,420,396 | [2] | |
Derivative assets | 3,064 | 666 | |||
Executive Deferred Savings Plan | 74,452 | 54,684 | |||
Total assets measured at fair value | 792,159 | [1] | 1,475,746 | [2] | |
Derivative liabilities | (3,106) | (898) | |||
Total financial liabilities | (3,106) | (898) | |||
Level 2 | U.S. Treasury securities | |||||
Fair Value Measurements | |||||
Marketable securities: | 0 | 18,999 | |||
Level 2 | U.S. Government agency securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 0 | 20,000 | |||
Marketable securities: | 8,749 | 28,002 | |||
Level 2 | Municipal securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 2,891 | ||||
Marketable securities: | 31,816 | 93,325 | |||
Level 2 | Corporate debt securities | |||||
Fair Value Measurements | |||||
Cash equivalents: | 13,099 | 68,992 | |||
Marketable securities: | 612,862 | 1,155,176 | |||
Level 2 | Money market and other | |||||
Fair Value Measurements | |||||
Cash equivalents: | 0 | 0 | |||
Level 2 | Sovereign securities | |||||
Fair Value Measurements | |||||
Marketable securities: | $ 48,117 | $ 33,011 | |||
[1] | Excludes cash of $183.1 million held in operating accounts and time deposits of $29.9 million as of June 30, 2015. | ||||
[2] | Excludes cash of $106.7 million held in operating accounts and time deposits of $33.5 million as of June 30, 2014. | ||||
[3] | Time deposits excluded from fair value measurements. |
Financial Statement Component51
Financial Statement Components - Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 | |
Accounts receivable, net: | |||
Accounts receivable, gross | $ 607,157 | $ 514,690 | |
Allowance for doubtful accounts | (21,663) | (21,827) | |
Accounts receivable, net | 585,494 | 492,863 | |
Inventories: | |||
Customer service parts | 209,726 | 203,194 | |
Raw materials | 194,218 | 221,612 | |
Work-in-process | 156,820 | 171,249 | |
Finished goods | 57,140 | 60,402 | |
Inventories | 617,904 | 656,457 | |
Other current assets: | |||
Prepaid expenses | [1] | 37,006 | 34,743 |
Income tax related receivables | 32,850 | 27,452 | |
Other current assets | 7,958 | 6,267 | |
Other current assets | 77,814 | 68,462 | |
Land, property and equipment, net: | |||
Land | 40,397 | 41,848 | |
Buildings and leasehold improvements | 316,566 | 302,537 | |
Machinery and equipment | 510,642 | 491,167 | |
Office furniture and fixtures | 21,411 | 20,945 | |
Construction-in-process | 3,152 | 8,945 | |
Land, property and equipment, gross | 892,168 | 865,442 | |
Less: accumulated depreciation and amortization | (577,577) | (535,179) | |
Land, property and equipment, net | 314,591 | 330,263 | |
Other non-current assets: | |||
Executive Deferred Savings Plan | 165,655 | 159,996 | |
Deferred tax assets—long-term | 78,648 | 75,138 | |
Other non-current assets | [1] | 15,384 | 21,302 |
Other non-current assets | 259,687 | 256,436 | |
Other current liabilities: | |||
Warranty | 36,413 | 37,746 | |
Executive Deferred Savings Plan | 167,886 | 160,527 | |
Compensation and benefits | 196,682 | 203,990 | |
Income taxes payable | 15,582 | 15,283 | |
Interest payable | 19,395 | 8,769 | |
Customer credits and advances | 93,212 | 79,373 | |
Other accrued expenses | 132,244 | 79,402 | |
Other current liabilities | 661,414 | 585,090 | |
Other non-current liabilities: | |||
Pension liabilities | 55,696 | 59,908 | |
Income taxes payable | 69,018 | 59,575 | |
Other non-current liabilities | 57,516 | 48,805 | |
Other non-current liabilities | $ 182,230 | $ 168,288 | |
[1] | Other current assets and other non-current assets balances as of June 30, 2014 on the consolidated balance sheet were adjusted to exclude the debt issuance costs as a result of early adoption of the accounting standards update regarding simplification of the presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. See Note 7, “Debt” for additional details. |
Financial Statement Component52
Financial Statement Components - Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Currency Translation Adjustments | $ (29,925) | $ (17,271) | |
Unrealized Gains (Losses) on Available-for-Sale Securities | 734 | 2,800 | |
Unrealized Gains (Losses) on Cash Flow Hedges | 4,553 | (12) | |
Unrealized Gains (Losses) on Defined Benefit Plans | (15,935) | (15,788) | |
Accumulated other comprehensive income (loss) | (40,573) | (30,271) | |
Unrealized gains (losses) on cash flow hedges from foreign exchange and interest rate contracts | 6,615 | 4,145 | $ 1,483 |
Other comprehensive (income) loss, reclassification adjustment from AOCI, pension and other postretirement benefit plans, net of tax | 1,300 | 1,300 | |
Revenues | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Unrealized gains (losses) on cash flow hedges from foreign exchange and interest rate contracts | 7,615 | 3,851 | |
Costs of revenues | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Unrealized gains (losses) on cash flow hedges from foreign exchange and interest rate contracts | (1,503) | 294 | |
Interest Expense | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Unrealized gains (losses) on cash flow hedges from foreign exchange and interest rate contracts | 503 | 0 | |
Interest income and other, net | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Unrealized gains on available-for-sale securities | $ 2,119 | $ 2,084 |
Financial Statement Component53
Financial Statement Components - Consolidated Statements of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Income Statement [Abstract] | |||
Interest income | $ (12,545) | $ (13,555) | $ (14,976) |
Foreign exchange losses, net | 1,764 | 514 | 1,002 |
Net realized gains on sale of investments | (2,119) | (2,084) | (2,287) |
Other | 2,431 | (1,078) | 1,149 |
Other expense (income), net | $ (10,469) | $ (16,203) | $ (15,112) |
Marketable Securities - Amortiz
Marketable Securities - Amortized Costs and Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 | |
Marketable Securities | |||
Amortized cost | $ 2,173,068 | $ 3,008,210 | |
Gross unrealized gains | 1,707 | 4,603 | |
Gross unrealized losses | (697) | (405) | |
Fair value | 2,174,078 | 3,012,408 | |
Add: time deposits | [1] | 29,941 | 33,509 |
Less: cash equivalents | 654,933 | 524,149 | |
Cash equivalents, gross unrealized gains | 0 | 0 | |
Cash equivalents, gross unrealized losses | 0 | (8) | |
Less: cash equivalents, fair value | 654,933 | 524,141 | |
Marketable securities, amortized cost | 1,548,076 | 2,517,570 | |
Available-for-sale Securities, Accumulated Gross Unrealized Gain, before Tax | 1,707 | 4,603 | |
Available-for-sale Securities, Accumulated Gross Unrealized Loss, before Tax | 697 | 397 | |
Marketable securities, fair value | 1,549,086 | 2,521,776 | |
U.S. Treasury securities | |||
Marketable Securities | |||
Amortized cost | 274,965 | 384,165 | |
Gross unrealized gains | 605 | 287 | |
Gross unrealized losses | (15) | (52) | |
Fair value | 275,555 | 384,400 | |
U.S. Government agency securities | |||
Marketable Securities | |||
Amortized cost | 571,843 | 867,309 | |
Gross unrealized gains | 551 | 651 | |
Gross unrealized losses | (126) | (117) | |
Fair value | 572,268 | 867,843 | |
Municipal securities | |||
Marketable Securities | |||
Amortized cost | 31,819 | 96,198 | |
Gross unrealized gains | 7 | 93 | |
Gross unrealized losses | (10) | (75) | |
Fair value | 31,816 | 96,216 | |
Corporate debt securities | |||
Marketable Securities | |||
Amortized cost | 625,965 | 1,220,794 | |
Gross unrealized gains | 511 | 3,526 | |
Gross unrealized losses | (515) | (152) | |
Fair value | 625,961 | 1,224,168 | |
Money market and other | |||
Marketable Securities | |||
Amortized cost | 611,385 | 397,517 | |
Gross unrealized gains | 0 | 0 | |
Gross unrealized losses | 0 | 0 | |
Fair value | 611,385 | 397,517 | |
Sovereign securities | |||
Marketable Securities | |||
Amortized cost | 57,091 | 42,227 | |
Gross unrealized gains | 33 | 46 | |
Gross unrealized losses | (31) | (9) | |
Fair value | $ 57,093 | $ 42,264 | |
[1] | Time deposits excluded from fair value measurements. |
Marketable Securities - Continu
Marketable Securities - Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | ||
Investments, Fair Value and Gross Unrealized Losses | ||||
Investment portfolio, maximum maturity term | 3 years | |||
Fair value | $ 491,301 | |||
Gross unrealized losses, less than 12 months | [1] | $ (697) | ||
Months in loss position not exceeding this period | 12 months | |||
Available-for-sale Securities, Gross Realized Gains | $ 2,400 | $ 2,200 | $ 2,500 | |
Available-for-sale Securities, Gross Realized Losses | 300 | $ 100 | $ 200 | |
U.S. Treasury securities | ||||
Investments, Fair Value and Gross Unrealized Losses | ||||
Fair value | 34,508 | |||
Gross unrealized losses, less than 12 months | [1] | (15) | ||
U.S. Government agency securities | ||||
Investments, Fair Value and Gross Unrealized Losses | ||||
Fair value | 133,933 | |||
Gross unrealized losses, less than 12 months | [1] | (126) | ||
Municipal securities | ||||
Investments, Fair Value and Gross Unrealized Losses | ||||
Fair value | 9,776 | |||
Gross unrealized losses, less than 12 months | [1] | (10) | ||
Corporate debt securities | ||||
Investments, Fair Value and Gross Unrealized Losses | ||||
Fair value | 286,355 | |||
Gross unrealized losses, less than 12 months | [1] | (515) | ||
Sovereign securities | ||||
Investments, Fair Value and Gross Unrealized Losses | ||||
Fair value | 26,729 | |||
Gross unrealized losses, less than 12 months | [1] | $ (31) | ||
[1] | As of June 30, 2015, the amount of total gross unrealized losses related to investments that had been in a continuous loss position for 12 months or more was immaterial. |
Marketable Securities - Contrac
Marketable Securities - Contractual Maturities of Securities (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 |
Investments, Debt and Equity Securities [Abstract] | ||
Amortized cost, due within one year | $ 496,916 | |
Fair value, due within one year | 497,121 | |
Amortized cost, due after one year through three years | 1,051,160 | |
Fair value, due after one year through three years | 1,051,965 | |
Marketable securities, amortized cost | 1,548,076 | $ 2,517,570 |
Marketable securities, fair value | $ 1,549,086 | $ 2,521,776 |
Business Combinations (Details)
Business Combinations (Details) - USD ($) $ in Thousands | Mar. 28, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 335,263 | $ 335,355 | $ 326,635 | |
Privately Held Company | ||||
Business Acquisition [Line Items] | ||||
Intangibles | $ 9,400 | |||
Goodwill | 8,730 | |||
Liabilities assumed | (130) | |||
Cash consideration paid | $ 18,000 |
Goodwill and Purchased Intang58
Goodwill and Purchased Intangible Assets - Schedule of Goodwill (Details) $ in Thousands | 12 Months Ended | |
Jun. 30, 2015USD ($)reporting_unit | Jun. 30, 2014USD ($) | |
Goodwill [Roll Forward] | ||
Goodwill, beginning balance | $ 335,355 | $ 326,635 |
Acquisition | 8,730 | |
Adjustments | (92) | (10) |
Goodwill, ending balance | $ 335,263 | $ 335,355 |
Number of reporting units | reporting_unit | 4 |
Goodwill and Purchased Intang59
Goodwill and Purchased Intangible Assets - Purchased Intangible Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Purchased Intangible Assets | |||
Gross carrying amount | $ 291,479 | $ 291,479 | |
Accumulated amortization and impairment | 279,584 | 263,782 | |
Net amount | 11,895 | 27,697 | |
Other intangible assets, amortization expense | 15,800 | 16,200 | $ 20,800 |
Remaining Estimated Annual Amortization Expense [Abstract] | |||
2,016 | 7,564 | ||
2,017 | 2,806 | ||
2,018 | 1,525 | ||
Total | 11,895 | 27,697 | |
Existing Technology | |||
Purchased Intangible Assets | |||
Gross carrying amount | 141,659 | 141,659 | |
Accumulated amortization and impairment | 134,664 | 126,567 | |
Net amount | 6,995 | 15,092 | |
Remaining Estimated Annual Amortization Expense [Abstract] | |||
Total | 6,995 | 15,092 | |
Patents | |||
Purchased Intangible Assets | |||
Gross carrying amount | 57,648 | 57,648 | |
Accumulated amortization and impairment | 56,998 | 54,398 | |
Net amount | 650 | 3,250 | |
Remaining Estimated Annual Amortization Expense [Abstract] | |||
Total | 650 | 3,250 | |
Trade Name/Trademark | |||
Purchased Intangible Assets | |||
Gross carrying amount | 19,893 | 19,893 | |
Accumulated amortization and impairment | 18,899 | 17,427 | |
Net amount | 994 | 2,466 | |
Remaining Estimated Annual Amortization Expense [Abstract] | |||
Total | 994 | 2,466 | |
Customer Relationships | |||
Purchased Intangible Assets | |||
Gross carrying amount | 54,980 | 54,980 | |
Accumulated amortization and impairment | 51,724 | 48,915 | |
Net amount | 3,256 | 6,065 | |
Remaining Estimated Annual Amortization Expense [Abstract] | |||
Total | 3,256 | 6,065 | |
Other | |||
Purchased Intangible Assets | |||
Gross carrying amount | 17,299 | 17,299 | |
Accumulated amortization and impairment | 17,299 | 16,475 | |
Net amount | 0 | 824 | |
Remaining Estimated Annual Amortization Expense [Abstract] | |||
Total | $ 0 | $ 824 | |
Minimum | Existing Technology | |||
Purchased Intangible Assets | |||
Range of useful lives | 4 years | ||
Minimum | Patents | |||
Purchased Intangible Assets | |||
Range of useful lives | 6 years | ||
Minimum | Trade Name/Trademark | |||
Purchased Intangible Assets | |||
Range of useful lives | 4 years | ||
Minimum | Customer Relationships | |||
Purchased Intangible Assets | |||
Range of useful lives | 6 years | ||
Minimum | Other | |||
Purchased Intangible Assets | |||
Range of useful lives | |||
Maximum | Existing Technology | |||
Purchased Intangible Assets | |||
Range of useful lives | 7 years | ||
Maximum | Patents | |||
Purchased Intangible Assets | |||
Range of useful lives | 13 years | ||
Maximum | Trade Name/Trademark | |||
Purchased Intangible Assets | |||
Range of useful lives | 10 years | ||
Maximum | Customer Relationships | |||
Purchased Intangible Assets | |||
Range of useful lives | 7 years | ||
Maximum | Other | |||
Purchased Intangible Assets | |||
Range of useful lives | 1 year |
Debt - Schedule of Long-term De
Debt - Schedule of Long-term Debt (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Jun. 30, 2015 | Jun. 30, 2014 | Nov. 30, 2014 | Oct. 31, 2014 | |||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 3,211,250 | $ 750,000 | ||||
Original discount on debt | (3,723) | (2,081) | ||||
Debt issuance costs | [1] | (17,111) | (2,818) | |||
Long-term debt | 3,190,416 | 745,101 | ||||
Long-term debt, current maturities | 16,981 | 0 | ||||
Long-term debt, excluding current maturities | $ 3,173,435 | 745,101 | ||||
Effective percentage including treasury rate lock hedge | 4.626% | |||||
Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Original discount on debt | $ (4,000) | |||||
Senior Notes | Senior Notes Due May 1, 2018 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 0 | $ 750,000 | ||||
Stated interest rate | 6.90% | |||||
Effective interest rate | 7.001% | |||||
Senior Notes | Senior Notes Due November 1, 2017 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 250,000 | $ 0 | ||||
Stated interest rate | 2.375% | |||||
Effective interest rate | 2.396% | |||||
Senior Notes | Senior Notes Due November 1, 2019 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 250,000 | 0 | ||||
Stated interest rate | 3.375% | |||||
Effective interest rate | 3.377% | |||||
Senior Notes | Senior Notes Due November 1, 2021 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 500,000 | 0 | ||||
Stated interest rate | 4.125% | |||||
Effective interest rate | 4.128% | |||||
Senior Notes | Senior Notes Due November 1, 2024 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | [2] | $ 1,250,000 | 0 | |||
Stated interest rate | 4.65% | [2] | 4.65% | |||
Effective interest rate | [2] | 4.682% | ||||
Senior Notes | Senior Notes Due November 1, 2034 | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 250,000 | 0 | ||||
Stated interest rate | 5.65% | |||||
Effective interest rate | 5.67% | |||||
Term Loans | ||||||
Debt Instrument [Line Items] | ||||||
Long-term debt, gross | $ 711,250 | $ 0 | ||||
[1] | The Company early adopted the accounting standard update regarding simplification of the presentation of debt issuance costs, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Accordingly, the Company applied the accounting standard update on a retrospective basis by reclassifying the presentation of the debt issuance costs totaling $2.8 million which was originally included in other current and other non-current assets against the long-term debt on the Consolidated Balance Sheet as of June 30, 2014. The change in the classification of the debt issuance costs reduced total assets and total liabilities by $2.8 million as of June 30, 2014. There is no impact to the Company’s Consolidated Statements of Operations, Comprehensive Income, Stockholder’s Equity and Cash Flows for the fiscal year ended June 30, 2014. | |||||
[2] | The effective interest rate disclosed above for this series of Senior Notes excludes the impact of the treasury rate lock hedge discussed below. The effective interest rate including the impact of the treasury rate lock hedge was 4.626%. |
Debt - Schedule of Future Princ
Debt - Schedule of Future Principal Payments (Details) $ in Thousands | 12 Months Ended |
Jun. 30, 2015USD ($) | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | $ 3,211,250 |
June 30, 2015 through December 31, 2016 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 17,500 |
March 31, 2017 through December 31, 2017 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 46,875 |
March 31, 2018 through September 30, 2019 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 315,625 |
December 31, 2019 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 75,000 |
2,020 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 756,250 |
Thereafter | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 2,000,000 |
Term Loans | June 30, 2015 through December 31, 2016 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 9,375 |
Term Loans | March 31, 2017 through December 31, 2017 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 14,063 |
Term Loans | March 31, 2018 through September 30, 2019 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | 18,750 |
Term Loans | December 31, 2019 | |
Debt Instrument, Redemption [Line Items] | |
Periodic payment, principal | $ 487,500 |
Debt - Senior Notes (Details)
Debt - Senior Notes (Details) - USD ($) | Nov. 19, 2014 | Dec. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Nov. 30, 2014 | Oct. 31, 2014 |
Debt Instrument [Line Items] | |||||||
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 18.5 | $ 1.8 | $ 1.6 | ||||
Cash dividends declared | $ 3,083,059,000 | $ 298,871,000 | $ 265,893,000 | ||||
Long-term debt, gross | 3,211,250,000 | 750,000,000 | |||||
Unamortized discount | $ 3,723,000 | 2,081,000 | |||||
Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 2,500,000,000 | ||||||
Unamortized discount | $ 4,000,000 | ||||||
Frequency of periodic payment | semi-annually | ||||||
Redemption price, percentage | 101.00% | ||||||
Debt instrument, fair value disclosure | $ 2,520,000,000 | 893,700,000 | |||||
Senior Notes | Senior Notes Due May 1, 2018 | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt, gross | $ 0 | $ 750,000,000 | |||||
Special Cash Dividend | |||||||
Debt Instrument [Line Items] | |||||||
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 16.50 | $ 16.50 | |||||
Cash dividends declared | $ 2,760,000,000 | ||||||
Moody's, Ba1 Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 0.25% | ||||||
Moody's, Ba2 Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 0.50% | ||||||
Moody's, Ba3 Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 0.75% | ||||||
Moody's, B1 Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 1.00% | ||||||
Standard & Poor's, BBplus Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 0.25% | ||||||
Standard & Poor's, BB Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 0.50% | ||||||
Standard & Poor's, BB- Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 0.75% | ||||||
Standard & Poor's, Bplus Rating | Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
Decrease in credit rating, interest rate adjustment | 1.00% | ||||||
Treasury Lock | Cash Flow Hedging | Forward Contracts | Designated as Hedging Instrument | Senior Notes | Portion of Senior Notes | |||||||
Debt Instrument [Line Items] | |||||||
10-year treasury rate derivative, notional amount | $ 1,000,000,000 |
Debt - Credit Facility (Details
Debt - Credit Facility (Details) | 1 Months Ended | 3 Months Ended | 12 Months Ended |
Nov. 30, 2014USD ($) | Jun. 30, 2015USD ($) | Jun. 30, 2015USD ($)quarter | |
Debt Instrument [Line Items] | |||
Quarterly payment, principal | $ 3,211,250,000 | ||
June 30, 2015 through December 31, 2016 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | 17,500,000 | ||
March 31, 2017 through December 31, 2017 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | 46,875,000 | ||
March 31, 2018 through September 30, 2019 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | 315,625,000 | ||
December 31, 2019 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | 75,000,000 | ||
Term Loans | |||
Debt Instrument [Line Items] | |||
Face amount | $ 750,000,000 | ||
Debt instrument, term | 5 years | ||
Additional principal prepaid | $ 20,000,000 | ||
Term Loans | June 30, 2015 through December 31, 2016 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | 9,375,000 | ||
Term Loans | March 31, 2017 through December 31, 2017 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | 14,063,000 | ||
Term Loans | March 31, 2018 through September 30, 2019 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | 18,750,000 | ||
Term Loans | December 31, 2019 | |||
Debt Instrument [Line Items] | |||
Quarterly payment, principal | $ 487,500,000 | ||
Term Loans and Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Covenant compliance, number of consecutive quarters | quarter | 4 | ||
Covenant compliance, minimum interest expense coverage ratio | 3.50 | ||
Term Loans and Revolving Credit Facility | Covenant Compliance Period 1 | |||
Debt Instrument [Line Items] | |||
Covenant compliance, number of consecutive quarters | quarter | 4 | ||
Maximum leverage ratio | 4.25 | ||
Term Loans and Revolving Credit Facility | Covenant Compliance Period 2 | |||
Debt Instrument [Line Items] | |||
Maximum leverage ratio | 4 | ||
Term Loans and Revolving Credit Facility | Covenant Compliance Period 3 | |||
Debt Instrument [Line Items] | |||
Maximum leverage ratio | 3.75 | ||
Term Loans and Revolving Credit Facility | Covenant Compliance Period 4 | |||
Debt Instrument [Line Items] | |||
Maximum leverage ratio | 3.50 | ||
Term Loans and Revolving Credit Facility | Covenant Compliance Period 5 | |||
Debt Instrument [Line Items] | |||
Maximum leverage ratio | 3 | ||
Term Loans and Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.25% | ||
Term Loans and Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.00% | ||
Term Loans and Revolving Credit Facility | London Interbank Offered Rate (LIBOR) | Maximum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.75% | ||
Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 500,000,000 | ||
Commitment fee percentage | 0.15% | ||
Revolving Credit Facility | Minimum | |||
Debt Instrument [Line Items] | |||
Commitment fee percentage | 0.10% | ||
Revolving Credit Facility | Maximum | |||
Debt Instrument [Line Items] | |||
Commitment fee percentage | 0.25% |
Debt - Debt Redemption (Details
Debt - Debt Redemption (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Dec. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | |
Debt Instrument [Line Items] | |||
Long-term debt, gross | $ 3,211,250 | $ 750,000 | |
Senior Notes | Senior Notes Due May 1, 2018 | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | $ 0 | $ 750,000 | |
Pre-tax net loss on extinguishment of debt | $ 131,700 | ||
Forward Contracts | Not Designated as Hedging Instrument | Senior Notes | Treasury Lock | Senior Notes Due May 1, 2018 | |||
Debt Instrument [Line Items] | |||
Derivative, gain on derivative | $ 1,200 |
Equity and Long-Term Incentiv65
Equity and Long-Term Incentive Compensation Plans - Equity Incentive Program (Details) shares in Thousands, $ in Thousands | Jun. 30, 2015USD ($)planshares | Jun. 30, 2014USD ($)shares | Nov. 06, 2013 | Nov. 05, 2013 | Jun. 30, 2013USD ($)shares | Jun. 30, 2012shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of plans | plan | 2 | ||||||
Maximum number of shares possible to be granted if all applicable performance-based criteria are achieved | 7,810 | [1] | 8,804 | 6,696 | 7,969 | ||
Dividends Payable | $ | $ 42,002 | $ 0 | $ 0 | ||||
Restricted Stock Unit, Performance-Based And Service Based | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Maximum number of shares possible to be granted if all applicable performance-based criteria are achieved | 600 | 600 | 600 | ||||
Dividends Payable | $ | $ 42,002 | ||||||
2004 Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Equity incentive plan, number of shares available for grant | 6,100 | ||||||
Percent of fair market value on grant date | 100.00% | ||||||
Impact on share reserve multiplier | 2 | 1.8 | |||||
Outside Director Option Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Maximum number of shares possible to be granted if all applicable performance-based criteria are achieved | 1,700 | ||||||
[1] | During the fiscal year ended June 30, 2015, the Company adjusted the number of shares subject to outstanding options under the 2004 Plan by an aggregate of 4,245 shares pursuant to a proportionate and equitable adjustment for the effect of the special cash dividend, as required by the 2004 Plan. The total number of outstanding options under the 2004 Plan as well as the associated exercise prices were adjusted to ensure the aggregate intrinsic value remained the same after considering the effect of the special cash dividend. As the adjustment was required by the 2004 Plan, under the authoritative guidance, the adjustment to the outstanding awards did not result in any incremental compensation expense. Additionally, the adjustment did not have an impact on the shares available for future issuance under the 2004 Plan. |
Equity and Long-Term Incentiv66
Equity and Long-Term Incentive Compensation Plans - Schedule of Equity Incentive Plan Activity (Details) | 12 Months Ended | ||||||
Jun. 30, 2015shares | Jun. 30, 2014shares | Jun. 30, 2013shares | Nov. 06, 2013 | Nov. 05, 2013 | |||
Total shares available for grant under the Company's equity incentive plans: | |||||||
Balances, beginning of period | 8,804,000 | 6,696,000 | 7,969,000 | ||||
Plan shares increased | 2,900,000 | ||||||
Options canceled/expired/forfeited, shares | 11,000 | 59,000 | 207,000 | ||||
Plan shares expired | [1] | (10,000) | (51,000) | (47,000) | |||
Balance, end of period | 7,810,000 | [2] | 8,804,000 | 6,696,000 | |||
Adjustments in period | 4,245 | ||||||
Restricted Stock Units (RSUs) | |||||||
Total shares available for grant under the Company's equity incentive plans: | |||||||
Restricted stock units granted | [3],[4] | (1,191,000) | (1,268,000) | (1,899,000) | |||
Restricted stock units canceled | [4] | 196,000 | 468,000 | 466,000 | |||
Restricted Stock Unit, Performance-Based And Service Based | |||||||
Total shares available for grant under the Company's equity incentive plans: | |||||||
Balances, beginning of period | 600,000 | 600,000 | |||||
Balance, end of period | 600,000 | 600,000 | 600,000 | ||||
2004 Plan | |||||||
Total shares available for grant under the Company's equity incentive plans: | |||||||
Impact on share reserve multiplier | 2 | 1.8 | |||||
2004 Plan | Restricted Stock Units (RSUs) | |||||||
Total shares available for grant under the Company's equity incentive plans: | |||||||
Restricted stock units granted | [5],[6] | (596,000) | |||||
Restricted stock units canceled | [6] | 108,000 | |||||
Minimum | Employee Stock Option | |||||||
Total shares available for grant under the Company's equity incentive plans: | |||||||
Prior to October 31, 2007, minimum options vesting period | 1 year | ||||||
Maximum | Employee Stock Option | |||||||
Total shares available for grant under the Company's equity incentive plans: | |||||||
Prior to October 31, 2007, minimum options vesting period | 5 years | ||||||
[1] | Represents the portion of shares listed as “Options canceled/expired/forfeited” above that were issued under the Company’s equity incentive plans other than the 2004 Plan and the Outside Director Plan. Because the Company is only currently authorized to issue equity awards under the 2004 Plan and the Outside Director Plan, any equity awards that are canceled, expired or forfeited under any other Company equity incentive plan do not result in additional shares being available to the Company for future grant. | ||||||
[2] | During the fiscal year ended June 30, 2015, the Company adjusted the number of shares subject to outstanding options under the 2004 Plan by an aggregate of 4,245 shares pursuant to a proportionate and equitable adjustment for the effect of the special cash dividend, as required by the 2004 Plan. The total number of outstanding options under the 2004 Plan as well as the associated exercise prices were adjusted to ensure the aggregate intrinsic value remained the same after considering the effect of the special cash dividend. As the adjustment was required by the 2004 Plan, under the authoritative guidance, the adjustment to the outstanding awards did not result in any incremental compensation expense. Additionally, the adjustment did not have an impact on the shares available for future issuance under the 2004 Plan. | ||||||
[3] | Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015, it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units granted during such fiscal year, reported at the maximum possible number of shares that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum levels and all applicable service-based criteria are fully satisfied (i.e., 0.6 million shares for the fiscal year ended June 30, 2013, 0.6 million shares for the fiscal year ended June 30, 2014 and 0.6 million shares for the fiscal year ended June 30, 2015, which, in each case reflects the application of the 1.8x or 2.0x multiplier described above). The Company has granted only restricted stock units under its equity incentive program since October 2007, except the number of shares subject to outstanding options under the 2004 Plan was adjusted during the three months ended December 31, 2014 due to a proportionate and equitable adjustment under the 2004 Plan provisions as discussed below. For the preceding several years until October 31, 2007, stock options were granted at the market price of the Company’s common stock on the date of grant generally with vesting period terms ranging from one to five years. Restricted stock units may be granted with varying criteria such as service-based and/or performance-based vesting. | ||||||
[4] | The number of restricted stock units provided in this row reflects the application of the award multiplier as described above (1.8x or 2.0x depending on the grant date of the applicable award). | ||||||
[5] | Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015, it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units, reported at the maximum possible number of shares (i.e., 0.3 million shares for the fiscal year ended June 30, 2013, 0.3 million shares for the fiscal year ended June 30, 2014 and 0.3 million shares for the fiscal year ended June 30, 2015) that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum and all applicable service-based criteria are fully satisfied . | ||||||
[6] | Share numbers reflect actual shares subject to awarded restricted stock units. As described above, under the terms of the 2004 Plan, the number of shares subject to each award reflected in this number is multiplied by either 1.8x or 2.0x (depending on the grant date of the award) to calculate the impact of the award on the share reserve under the 2004 Plan. |
Equity and Long-Term Incentiv67
Equity and Long-Term Incentive Compensation Plans - Share-based Compensation Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Stock-based compensation expense | |||
Stock-based compensation expense | $ 55,302 | $ 60,940 | $ 70,084 |
Stock-based compensation capitalized as inventory | 3,242 | 8,278 | |
Costs of revenues | |||
Stock-based compensation expense | |||
Stock-based compensation expense | 7,242 | 9,101 | 11,433 |
Engineering, research and development | |||
Stock-based compensation expense | |||
Stock-based compensation expense | 12,259 | 16,397 | 19,346 |
Selling, general and administrative | |||
Stock-based compensation expense | |||
Stock-based compensation expense | $ 35,801 | $ 35,442 | $ 39,305 |
Equity and Long-Term Incentiv68
Equity and Long-Term Incentive Compensation Plans - Stock Options Activities (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Stock Options, Activity and Weighted-Average Exercise Price | |||
Outstanding stock options, shares | 141,000 | ||
Granted, shares | 4,000 | ||
Exercised, shares | (134,000) | ||
Canceled/expired/forfeited, shares | (11,000) | (59,000) | (207,000) |
Outstanding stock options, shares | 0 | 141,000 | |
Outstanding stock options, weighted-average exercise price | $ 40.70 | ||
Granted, weighted-average exercise price | 32.11 | ||
Exercised, weighted-average exercise price | 39.32 | ||
Canceled/expired/forfeited, weighted-average exercise price | 39.97 | ||
Outstanding stock options, weighted-average exercise price | $ 0 | $ 40.70 | |
Adjustments in period | 4,245 | ||
Total intrinsic value of options exercised | $ 4,549 | $ 18,022 | $ 15,884 |
Total cash received from employees and non-employee Board members as a result of stock option exercises | 5,892 | 72,700 | 89,935 |
Tax benefits realized by the Company in connection with these exercises | $ 1,989 | $ 5,708 | $ 5,223 |
Equity and Long-Term Incentiv69
Equity and Long-Term Incentive Compensation Plans - Restricted Stock Unit Activities (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | 60 Months Ended | |||||
Jun. 30, 2015USD ($)$ / sharesshares | Jun. 30, 2014USD ($)$ / sharesshares | Jun. 30, 2013USD ($)Installment$ / sharesshares | Jun. 30, 2012 | Nov. 06, 2013 | Nov. 05, 2013 | ||
Restricted Stock Units Activity Roll Forward | |||||||
Granted, weighted-average grant date fair value | $ / shares | $ 74.48 | $ 53.28 | $ 47.71 | ||||
Tax benefits realized by the Company in connection with vested and released restricted stock units | $ | $ 26,250 | $ 44,298 | $ 29,204 | ||||
Intrinsic Value of outstanding restricted stock units | $ | $ 150,300 | ||||||
Restricted Stock Units (RSUs) | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Maximum possible number of shares granted, shares, if all applicable performance-based criteria are achieved | [1],[2] | 1,191 | 1,268 | 1,899 | |||
Forfeited. shares | [2] | (196) | (468) | (466) | |||
Unrecognized stock-based compensation expense balance | $ | $ 60,300 | ||||||
Estimated weighted-average amortization period | 1 year | ||||||
2004 Plan | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Impact on share reserve multiplier | 2 | 1.8 | |||||
2004 Plan | Restricted Stock Units (RSUs) | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Outstanding restricted stock units, shares | [3],[4] | 3,356 | |||||
Maximum possible number of shares granted, shares, if all applicable performance-based criteria are achieved | [3],[4] | 596 | |||||
Vested and released, shares | [4] | (765) | |||||
Withheld for taxes, shares | [4] | (405) | |||||
Forfeited. shares | [4] | (108) | |||||
Outstanding restricted stock units, shares | [3],[4] | 2,674 | 3,356 | ||||
Outstanding restricted stock units, weighted-average grant date fair value | $ / shares | [3] | $ 38.95 | |||||
Granted, weighted-average grant date fair value | $ / shares | [3] | 74.48 | |||||
Vested and released, weighted-average grant date fair value | $ / shares | 32.50 | ||||||
Withheld for taxes, weighted-average grant date fair value | $ / shares | 32.50 | ||||||
Forfeited, weighted-average grant date fair value | $ / shares | 38.90 | ||||||
Outstanding restricted stock units, weighted-average grant date fair value | $ / shares | [3] | $ 49.36 | $ 38.95 | ||||
Restricted Stock Units (RSUs) | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Share-based compensation arrangement by share-based payment award, number of equal vesting installments | Installment | 2 | ||||||
Restricted Stock Unit, Performance-Based And Service Based | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Share-based compensation arrangement by share-based payment award, number of equal vesting installments | Installment | 2 | ||||||
Restricted Stock Unit, Performance-Based And Service Based | Second Anniversary | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Percentage of equal vesting installments | 50.00% | ||||||
Restricted Stock Unit, Performance-Based And Service Based | Third Anniversary | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Percentage of equal vesting installments | 50.00% | ||||||
Restricted Stock Unit, Performance-Based And Service Based | Fourth Anniversary | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Percentage of equal vesting installments | 50.00% | 50.00% | |||||
Restricted Stock Unit, Service-Based | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Share-based compensation arrangement by share-based payment award, number of equal vesting installments | Installment | 4 | ||||||
Restricted Stock Unit, Service-Based | First Anniversary | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Percentage of equal vesting installments | 25.00% | ||||||
Restricted Stock Unit, Service-Based | Second Anniversary | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Percentage of equal vesting installments | 25.00% | ||||||
Restricted Stock Unit, Service-Based | Third Anniversary | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Percentage of equal vesting installments | 25.00% | ||||||
Restricted Stock Unit, Service-Based | Fourth Anniversary | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Percentage of equal vesting installments | 25.00% | ||||||
Management | Restricted Stock Units (RSUs) | Restricted Stock Unit, Performance-Based And Service Based | |||||||
Restricted Stock Units Activity Roll Forward | |||||||
Maximum possible number of shares granted, shares, if all applicable performance-based criteria are achieved | 300 | 300 | 300 | ||||
[1] | Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015, it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units granted during such fiscal year, reported at the maximum possible number of shares that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum levels and all applicable service-based criteria are fully satisfied (i.e., 0.6 million shares for the fiscal year ended June 30, 2013, 0.6 million shares for the fiscal year ended June 30, 2014 and 0.6 million shares for the fiscal year ended June 30, 2015, which, in each case reflects the application of the 1.8x or 2.0x multiplier described above). The Company has granted only restricted stock units under its equity incentive program since October 2007, except the number of shares subject to outstanding options under the 2004 Plan was adjusted during the three months ended December 31, 2014 due to a proportionate and equitable adjustment under the 2004 Plan provisions as discussed below. For the preceding several years until October 31, 2007, stock options were granted at the market price of the Company’s common stock on the date of grant generally with vesting period terms ranging from one to five years. Restricted stock units may be granted with varying criteria such as service-based and/or performance-based vesting. | ||||||
[2] | The number of restricted stock units provided in this row reflects the application of the award multiplier as described above (1.8x or 2.0x depending on the grant date of the applicable award). | ||||||
[3] | Includes restricted stock units granted to senior management during the applicable fiscal year with performance-based vesting criteria (in addition to service-based vesting criteria for any of such restricted stock units that are deemed to have been earned). As of June 30, 2015, it had not yet been determined the extent to which (if at all) the performance-based vesting criteria of such restricted stock units had been satisfied. Therefore, this line item includes all such performance-based restricted stock units, reported at the maximum possible number of shares (i.e., 0.3 million shares for the fiscal year ended June 30, 2013, 0.3 million shares for the fiscal year ended June 30, 2014 and 0.3 million shares for the fiscal year ended June 30, 2015) that may ultimately be issuable under such restricted stock units if all applicable performance-based criteria are achieved at their maximum and all applicable service-based criteria are fully satisfied . | ||||||
[4] | Share numbers reflect actual shares subject to awarded restricted stock units. As described above, under the terms of the 2004 Plan, the number of shares subject to each award reflected in this number is multiplied by either 1.8x or 2.0x (depending on the grant date of the award) to calculate the impact of the award on the share reserve under the 2004 Plan. |
Equity and Long-Term Incentiv70
Equity and Long-Term Incentive Compensation Plans - Cash-Based Long-Term Incentive Compensation (Details) - Cash Long-Term Incentive Plan $ in Millions | 12 Months Ended | |
Jun. 30, 2015USD ($)Installment | Jun. 30, 2014USD ($) | |
Cash Long-Term Incentive Plan | ||
Cash-based long-term incentive plan, granted amount | $ 67.7 | |
Cash long-term incentive plan, equal vesting installments | Installment | 4 | |
Cash long-term incentive plan, percentage of equal vesting installments | 25.00% | |
Cash long-term incentive plan, vesting period (in years) | 4 years | |
Executive deferred compensation program, compensation expense | $ 39.6 | $ 26.2 |
Cash long-term incentive plan, unrecognized compensation balance | $ 94.5 |
Equity and Long-Term Incentiv71
Equity and Long-Term Incentive Compensation Plans - Fair Value Assumptions and ESPP (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Aug. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
ESPP, maximum employee subscription rate | 10.00% | |||
ESPP, offering period | 6 months | |||
ESPP, discount from market price, lesser of commencement of offering period or purchase date | 85.00% | |||
ESPP Activities [Abstract] | ||||
Total cash received from employees for the issuance of shares under the ESPP | $ 41,116 | $ 39,675 | $ 36,186 | |
Number of shares purchased by employees through the ESPP | 759,000 | 796,000 | 877,000 | |
Tax benefits realized by the Company in connection with the disqualifying dispositions of shares purchased under the ESPP | $ 1,741 | $ 2,221 | $ 1,452 | |
Weighted-average fair value per share based on Black-Scholes model | $ 14.55 | $ 12.31 | $ 10.46 | |
ESPP maximum annual share replenishment | 2,000,000 | 2,000,000 | ||
Number of ESPP shares available for future issuance | 2,100,000 | |||
Employee Stock Purchase Plan | ||||
ESPP, Fair Value Assumptions and Methodology | ||||
Expected stock price volatility | 24.50% | 27.50% | 28.80% | |
Risk-free interest rate | 0.10% | 0.10% | 0.10% | |
Dividend yield | 2.80% | 2.90% | 3.20% | |
Expected life (in years) | 6 months | 6 months | 6 months |
Equity and Long-Term Incentiv72
Equity and Long-Term Incentive Compensation Plans - Dividends (Details) - USD ($) | Aug. 06, 2015 | Jul. 14, 2015 | May. 07, 2015 | Nov. 19, 2014 | Dec. 31, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Dividends Payable [Line Items] | ||||||||
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 18.5 | $ 1.8 | $ 1.6 | |||||
Payments of dividends | $ 3,041,055,000 | $ 298,871,000 | $ 265,893,000 | |||||
Dividends Payable | 42,002,000 | 0 | 0 | |||||
Cash dividends declared | 3,083,059,000 | 298,871,000 | 265,893,000 | |||||
Retained earnings (accumulated deficit) | (12,362,000) | 2,479,113,000 | ||||||
Retained Earnings | ||||||||
Dividends Payable [Line Items] | ||||||||
Cash dividends declared | 2,275,668,000 | 298,871,000 | $ 265,893,000 | |||||
Regular Cash Dividend | ||||||||
Dividends Payable [Line Items] | ||||||||
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 0.50 | |||||||
Regular Cash Dividend | Subsequent Event | ||||||||
Dividends Payable [Line Items] | ||||||||
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 0.52 | $ 0.52 | ||||||
Regular Cash Dividend | Additional Paid-in Capital | ||||||||
Dividends Payable [Line Items] | ||||||||
Payments of dividends | 324,800,000 | |||||||
Regular Cash Dividend | Retained Earnings | ||||||||
Dividends Payable [Line Items] | ||||||||
Payments of dividends | 298,871,000 | |||||||
Special Cash Dividend | ||||||||
Dividends Payable [Line Items] | ||||||||
Cash dividends declared per share (including Special Cash dividend of 16.50) (in dollars per share) | $ 16.50 | $ 16.50 | ||||||
Cash dividends declared | $ 2,760,000,000 | |||||||
Retained earnings (accumulated deficit) | $ 0 | |||||||
Special Cash Dividend | Additional Paid-in Capital | ||||||||
Dividends Payable [Line Items] | ||||||||
Cash dividends declared | 646,500,000 | |||||||
Special Cash Dividend | Retained Earnings | ||||||||
Dividends Payable [Line Items] | ||||||||
Cash dividends declared | $ 2,100,000,000 | |||||||
Restricted Stock Unit, Performance-Based And Service Based | ||||||||
Dividends Payable [Line Items] | ||||||||
Dividends Payable | 42,002,000 | |||||||
Restricted Stock Unit, Performance-Based And Service Based | Regular Cash Dividend | ||||||||
Dividends Payable [Line Items] | ||||||||
Dividends Payable | 900,000 | $ 0 | ||||||
Restricted Stock Units (RSUs) | Special Cash Dividend | ||||||||
Dividends Payable [Line Items] | ||||||||
Dividends Payable | $ 41,100,000 |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) $ in Thousands | Jul. 08, 2015 | Oct. 23, 2014 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Stock Repurchase Program | |||||
Number of additional shares authorized | 3,600,000 | ||||
Shares available for repurchase | 9,400,000 | ||||
Total cost of repurchases | $ 608,856 | $ 240,843 | $ 273,254 | ||
Other Current Liabilities | |||||
Stock Repurchase Program | |||||
Number of shares of common stock repurchased - unsettled shares | 105,542 | ||||
Total cost of repurchases | $ 6,000 | ||||
Common Stock and Capital in Excess of Par Value, Shares | |||||
Stock Repurchase Program | |||||
Number of shares of common stock repurchased - unsettled shares | 9,255,000 | 3,835,000 | 5,374,000 | ||
Subsequent Event | |||||
Stock Repurchase Program | |||||
Number of additional shares authorized | 13,000,000 |
Net Income Per Share (Details)
Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||
Net income | $ 142,019 | $ 131,638 | $ 20,268 | $ 72,233 | $ 128,731 | $ 203,581 | $ 139,246 | $ 111,197 | $ 366,158 | $ 582,755 | $ 543,149 | ||||||||
Denominator: | |||||||||||||||||||
Weighted-average shares-basic, excluding unvested restricted stock units (in shares) | 162,282 | 166,016 | 166,089 | ||||||||||||||||
Effect of dilutive options and restricted stock units (in shares) | 1,419 | 2,102 | 3,171 | ||||||||||||||||
Weighted-average shares-diluted (in shares) | 163,701 | 168,118 | 169,260 | ||||||||||||||||
Basic net income per share (in dollars per share) | $ 0.90 | [1] | $ 0.81 | [1] | $ 0.12 | [1] | $ 0.44 | [1] | $ 0.78 | [1] | $ 1.22 | [1] | $ 0.84 | [1] | $ 0.67 | [1] | $ 2.26 | $ 3.51 | $ 3.27 |
Diluted net income per share (in dollars per share) | $ 0.89 | [1] | $ 0.81 | [1] | $ 0.12 | [1] | $ 0.43 | [1] | $ 0.77 | [1] | $ 1.21 | [1] | $ 0.83 | [1] | $ 0.66 | [1] | $ 2.24 | $ 3.47 | $ 3.21 |
Anti-dilutive securities excluded from the computation of diluted net income per share (in shares) | 36 | 0 | 1,366 | ||||||||||||||||
[1] | Basic and diluted earnings per share are computed independently for each of the quarters presented based on the weighted-average basic and fully diluted shares outstanding for each quarter. Therefore, the sum of quarterly basic and diluted per share information may not equal annual basic and diluted earnings per share. |
Employee Benefit Plans - Schedu
Employee Benefit Plans - Schedule of Defined Benefit Plans (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Deferred Compensation Arrangements | |||
Deferred compensation arrangement maximum percentage contribution match of employees 401(K) contribution | 50.00% | ||
Deferred compensation arrangement maximum 401(K) employee contribution subject to employer percentage match | $ 8,000 | ||
Employer maximum contribution match | 4,000 | ||
Deferred compensation arrangement under the profit sharing and 401(K) programs, total expenses | 14,200,000 | $ 15,400,000 | $ 13,100,000 |
Foreign Pension Plans, Defined Benefit | |||
Change in projected benefit obligation: | |||
Projected benefit obligation as of the beginning of the fiscal year | 77,035,000 | 71,276,000 | |
Service cost | 3,905,000 | 4,054,000 | 3,399,000 |
Interest cost | 1,562,000 | 1,401,000 | 1,320,000 |
Contributions by plan participants | 81,000 | 102,000 | |
Actuarial loss | 3,702,000 | 1,927,000 | |
Benefit payments | (3,982,000) | (1,910,000) | |
Foreign currency exchange rate changes and others, net | (6,375,000) | 185,000 | |
Projected benefit obligation as of the end of the fiscal year | 75,928,000 | 77,035,000 | 71,276,000 |
Change in fair value of plan assets: | |||
Fair value of plan assets as of the beginning of the fiscal year | 15,163,000 | 13,317,000 | |
Actual return on plan assets | 334,000 | 274,000 | |
Employer contributions | 3,568,000 | 3,229,000 | |
Benefit and expense payments | (3,982,000) | (1,910,000) | |
Foreign currency exchange rate changes and others, net | 1,955,000 | 253,000 | |
Fair value of plan assets as of the end of the fiscal year | 17,038,000 | 15,163,000 | $ 13,317,000 |
Funded status | |||
Underfunded status | 58,890,000 | 61,872,000 | |
Plans with accumulated benefit obligations in excess of plan assets: | |||
Accumulated benefit obligation | 46,419,000 | 47,122,000 | |
Projected benefit obligation | 75,928,000 | 77,035,000 | |
Plan assets at fair value | $ 17,038,000 | $ 15,163,000 |
Employee Benefit Plans - Weight
Employee Benefit Plans - Weighted Average Assumptions (Details) - Foreign Pension Plans, Defined Benefit | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Defined Benefit Plan Disclosure [Line Items] | |||
Discount rate, minimum | 1.30% | 1.50% | 1.50% |
Expected rate of return on assets, minimum | 1.80% | 1.80% | 1.80% |
Rate of compensation increase, minimum | 3.00% | 3.00% | 3.00% |
Discount rate, maximum | 2.00% | 3.50% | 3.50% |
Expected rate of return on assets, maximum | 2.50% | 3.80% | 4.00% |
Rate of compensation increase, maximum | 5.50% | 5.50% | 5.00% |
Employee Benefit Plans - Amount
Employee Benefit Plans - Amount Recognized or Expected to be Recognized in Accumulated Other Comprehensive Income (Loss) (Details) - Foreign Pension Plans, Defined Benefit - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Losses Recognized in Accumulated Other Comprehensive Income (Loss) | ||
Unrecognized transition obligation | $ 515 | $ 772 |
Unrecognized prior service cost | 180 | 225 |
Unrealized net loss | 24,119 | 23,645 |
Amount of losses recognized | 24,814 | $ 24,642 |
Losses in Accumulated Other Comprehensive Income (Loss) Expected to be Recognized as Components of Net Periodic Benefit Cost Over Next Fiscal Year | ||
Unrecognized transition obligation | 255 | |
Unrecognized prior service cost | 42 | |
Unrealized net loss | 824 | |
Amount of losses expected to be recognized | $ 1,121 |
Employee Benefit Plans - Compon
Employee Benefit Plans - Components of Net Periodic Pension Cost (Details) - Foreign Pension Plans, Defined Benefit - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Components of net periodic pension cost | |||
Service cost | $ 3,905 | $ 4,054 | $ 3,399 |
Interest cost | 1,562 | 1,401 | 1,320 |
Return on plan assets | (450) | (321) | (315) |
Amortization of transitional obligation | 259 | 262 | 372 |
Amortization of prior service cost | 46 | 52 | 58 |
Amortization of net loss | 1,014 | 1,021 | 633 |
Adjustment | (177) | 0 | (1,436) |
Net periodic pension cost | $ 6,159 | $ 6,469 | $ 4,031 |
Employee Benefit Plans - Fair V
Employee Benefit Plans - Fair Value of Plan Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | |||
Fair Value Measurements | ||||
Bonds, equity securities and other investments | $ 1,549,086 | $ 2,521,776 | ||
Total assets measured at fair value | $ 2,342,797 | [1] | $ 3,173,069 | [2] |
Foreign Pension Plans, Defined Benefit | ||||
Defined Benefit Plan Disclosure | ||||
Defined benefit plan, target plan asset allocations | 100.00% | 100.00% | ||
Defined benefit plan, estimated future employer contributions in next fiscal year | $ 1,700 | |||
Defined benefit plan maximum yearly expected future benefit | 2,500 | |||
Fair Value Measurements | ||||
Cash and cash equivalents | 10,954 | $ 11,061 | ||
Bonds, equity securities and other investments | 6,084 | 4,102 | ||
Total assets measured at fair value | 17,038 | 15,163 | ||
Level 1 | ||||
Fair Value Measurements | ||||
Total assets measured at fair value | 1,550,638 | [1] | 1,697,323 | [2] |
Level 1 | Foreign Pension Plans, Defined Benefit | ||||
Fair Value Measurements | ||||
Cash and cash equivalents | 10,954 | 11,061 | ||
Bonds, equity securities and other investments | 0 | 0 | ||
Total assets measured at fair value | 10,954 | 11,061 | ||
Level 2 | ||||
Fair Value Measurements | ||||
Total assets measured at fair value | 792,159 | [1] | 1,475,746 | [2] |
Level 2 | Foreign Pension Plans, Defined Benefit | ||||
Fair Value Measurements | ||||
Cash and cash equivalents | 0 | 0 | ||
Bonds, equity securities and other investments | 6,084 | 4,102 | ||
Total assets measured at fair value | $ 6,084 | $ 4,102 | ||
[1] | Excludes cash of $183.1 million held in operating accounts and time deposits of $29.9 million as of June 30, 2015. | |||
[2] | Excludes cash of $106.7 million held in operating accounts and time deposits of $33.5 million as of June 30, 2014. |
Income Taxes - Schedule of Inco
Income Taxes - Schedule of Income Before Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | |||
Domestic income before income taxes | $ 157,251 | $ 434,336 | $ 420,862 |
Foreign income before income taxes | 276,880 | 300,125 | 269,759 |
Total income before income taxes | $ 434,131 | $ 734,461 | $ 690,621 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | Jun. 30, 2012 | |
Income Tax Contingency [Line Items] | ||||
Share-based compensation cost, amount | $ 16,700 | $ 16,500 | $ 6,900 | |
Operating loss carryforwards, state and local | 123,700 | |||
Deferred tax assets, valuation allowance | 91,350 | 76,328 | ||
Undistributed earnings for certain foreign subsidiaries | 1,700,000 | |||
Undistributed earnings of foreign subsidiaries | 573,900 | |||
Unrecognized tax benefits | 69,018 | 59,575 | 59,494 | $ 50,839 |
Unrecognized tax benefits, income tax penalties and interest expense | 1,200 | 700 | 1,400 | |
Income tax penalties and interest accrued | 7,900 | 6,700 | ||
Amount of unrecorded benefit | 27,300 | |||
U.S. Federal | ||||
Income Tax Contingency [Line Items] | ||||
Operating loss carryforwards | 25,700 | |||
State | ||||
Income Tax Contingency [Line Items] | ||||
Operating loss carryforwards | 90,800 | |||
State credit carry-forward | 76,900 | |||
Foreign Tax Authority | ||||
Income Tax Contingency [Line Items] | ||||
Operating loss carryforwards | 50,200 | |||
Isreal Tax Authority and Inland Revenue, Singapore (IRAS) | ||||
Income Tax Contingency [Line Items] | ||||
Income tax holiday, effect from expiration | 3,100 | |||
Income tax holiday, aggregate dollar amount | $ 20,400 | $ 25,800 | $ 25,800 | |
Income tax holiday, income tax benefits per share (usd per share) | $ 0.13 | $ 0.15 | $ 0.15 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Current: | |||
Federal | $ 63,123 | $ 98,937 | $ 118,888 |
State | 3,655 | 8,580 | 4,404 |
Foreign | 25,438 | 27,867 | 25,112 |
Current income tax expense (benefit) | 92,216 | 135,384 | 148,404 |
Deferred: | |||
Federal | (22,390) | 22,904 | (2,552) |
State | 409 | (334) | (1,036) |
Foreign | (2,262) | (6,248) | 2,656 |
Deferred income tax expense (benefit) | (24,243) | 16,322 | (932) |
Provision for income taxes | $ 67,973 | $ 151,706 | $ 147,472 |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 |
Deferred Tax Assets, Gross [Abstract] | ||
Tax credits and net operating losses | $ 108,615 | $ 95,492 |
Employee benefits accrual | 99,472 | 97,308 |
Stock-based compensation | 18,722 | 17,676 |
Capitalized R&D expenses | 47 | 12,051 |
Inventory reserves | 92,649 | 83,783 |
Non-deductible reserves | 47,176 | 41,469 |
Depreciation and amortization | 13,267 | 2,572 |
Unearned revenue | 16,150 | 13,937 |
Other | 28,784 | 29,483 |
Gross deferred tax assets | 424,882 | 393,771 |
Valuation allowance | (91,350) | (76,328) |
Net deferred tax assets | 333,532 | 317,443 |
Deferred Tax Liabilities, Gross [Abstract] | ||
Unremitted earnings of foreign subsidiaries not permanently reinvested | (12,775) | (17,334) |
Deferred profit | (7,372) | (16,358) |
Unrealized gain on investments | (2,673) | (1,168) |
Total deferred tax liabilities | (22,820) | (34,860) |
Total net deferred tax assets | $ 310,712 | $ 282,583 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate | 35.00% | 35.00% | 35.00% |
State income taxes, net of federal benefit | 0.70% | 0.70% | 0.30% |
Effect of foreign operations taxed at various rates | (15.30%) | (11.50%) | (9.60%) |
Research and development tax credit | (3.70%) | (1.50%) | (3.10%) |
Net change in tax reserves | 1.50% | 0.30% | 1.70% |
Domestic manufacturing benefit | (2.10%) | (1.40%) | (1.60%) |
Effect of stock-based compensation | 0.80% | 0.40% | (0.30%) |
Other | (1.20%) | (1.30%) | (1.00%) |
Effective income tax rate | 15.70% | 20.70% | 21.40% |
Income Taxes - Summary of Incom
Income Taxes - Summary of Income Tax Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits at the beginning of the year | $ 59,575 | $ 59,494 | $ 50,839 |
Increases for tax positions taken in prior years | 1,245 | 551 | 2,701 |
Decreases for tax positions taken in prior years | (7) | (764) | (905) |
Increases for tax positions taken in current year | 11,634 | 11,585 | 12,709 |
Decreases for settlements with taxing authorities | 0 | (3,601) | (3,907) |
Decreases for lapsing of statutes of limitations | (3,429) | (7,690) | (1,943) |
Unrecognized tax benefits at the end of the year | $ 69,018 | $ 59,575 | $ 59,494 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Certain Trade Receivables and Products (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Receivables sold under factoring agreements | $ 137,285 | $ 116,292 |
Proceeds from sales of LCs | $ 6,920 | $ 8,323 |
Commitments and Contingencies87
Commitments and Contingencies - Additional Information (Details) $ in Millions | 12 Months Ended | ||
Jun. 30, 2015USD ($)hInstallment | Jun. 30, 2014USD ($) | Jun. 30, 2013USD ($) | |
Operating Leased Assets [Line Items] | |||
Operating leases, rent expense | $ 9.1 | $ 8.7 | $ 9.2 |
Open inventory purchase commitments | $ 298.7 | ||
Outstanding inventory purchase commitment | 12 months | ||
Cash-based long-term incentive plan, committed amount | $ 125 | ||
Standard warranty coverage, hours per week | h | 40 | ||
Standard warranty coverage, in months | 12 months | ||
Guarantee arrangements to fund customs guarantees for VAT and other operating requirements | $ 22.5 | ||
Outstanding guarantee arrangements to fund customs guarantees for VAT and other operating requirements | $ 19 | ||
Cash Long-Term Incentive Plan | |||
Operating Leased Assets [Line Items] | |||
Cash long-term incentive plan, equal vesting installments | Installment | 4 | ||
Cash long-term incentive plan, percentage of equal vesting installments | 25.00% | ||
Cash long-term incentive plan, vesting period (in years) | 4 years |
Commitments and Contingencies88
Commitments and Contingencies - Schedule of Future Minimum Rental Payments for Operations (Details) $ in Thousands | Jun. 30, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,016 | $ 8,008 |
2,017 | 5,818 |
2,018 | 3,964 |
2,019 | 1,815 |
2,020 | 1,220 |
2021 and thereafter | 556 |
Total minimum lease payments | $ 21,381 |
Commitments and Contingencies89
Commitments and Contingencies - Schedule of Product Warranty Liability (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Change in Product Warranty Liability | ||
Beginning balance | $ 37,746 | $ 42,603 |
Accruals for warranties issued during the period | 39,368 | 45,540 |
Changes in liability related to pre-existing warranties | (572) | (8,462) |
Settlements made during the period | (40,129) | (41,935) |
Ending balance | $ 36,413 | $ 37,746 |
Restructuring Charges (Details)
Restructuring Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | |
Restructuring Charges | |||
Restructuring charges, net | $ 31,600 | ||
Restructuring Charges | |||
Beginning balance | 2,329 | $ 3,947 | |
Restructuring costs | $ 22,400 | 31,569 | 6,662 |
Adjustments | 1,177 | (459) | |
Cash payments | (10,188) | (7,821) | |
Ending balance | $ 24,887 | 24,887 | $ 2,329 |
Costs of revenues | |||
Restructuring Charges | |||
Restructuring charges, net | 8,000 | ||
Engineering, research and development | |||
Restructuring Charges | |||
Restructuring charges, net | 11,100 | ||
Selling, general and administrative | |||
Restructuring Charges | |||
Restructuring charges, net | $ 12,500 |
Derivative Instruments and He91
Derivative Instruments and Hedging Activities - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2014 | Jun. 30, 2015 | Nov. 30, 2014 | Oct. 31, 2014 | Jun. 30, 2014 | |||
Derivative [Line Items] | |||||||
Maximum remaining maturity | 18 months | ||||||
Unrealized Gains (Losses) on Cash Flow Hedges | $ 4,553,000 | $ (12,000) | |||||
Long-term debt, gross | $ 3,211,250,000 | 750,000,000 | |||||
Higher remaining maturity range | 16 months | ||||||
Senior Notes | |||||||
Derivative [Line Items] | |||||||
Face amount | $ 2,500,000,000 | ||||||
Senior Notes | Senior Notes Due November 1, 2024 | |||||||
Derivative [Line Items] | |||||||
Face amount | $ 1,250,000,000 | ||||||
Stated interest rate | 4.65% | [1] | 4.65% | ||||
Long-term debt, gross | [1] | $ 1,250,000,000 | $ 0 | ||||
Senior Notes | Senior Notes Due May 1, 2018 | |||||||
Derivative [Line Items] | |||||||
Stated interest rate | 6.90% | ||||||
Long-term debt, gross | 0 | $ 750,000,000 | |||||
Forward Contracts | Designated as Hedging Instrument | Cash Flow Hedging | Portion of Senior Notes | Treasury Lock | Senior Notes | |||||||
Derivative [Line Items] | |||||||
Derivative, notional amount | $ 1,000,000,000 | ||||||
Unrealized Gains (Losses) on Cash Flow Hedges | $ 7,500,000 | 7,500,000 | |||||
Forward Contracts | Not Designated as Hedging Instrument | Senior Notes Due May 1, 2018 | Treasury Lock | Senior Notes | |||||||
Derivative [Line Items] | |||||||
Derivative, gain on derivative | $ 1,200,000 | ||||||
Forward Contracts | Interest Expense | Designated as Hedging Instrument | Cash Flow Hedging | Portion of Senior Notes | Treasury Lock | Senior Notes | |||||||
Derivative [Line Items] | |||||||
Gain reclassified from accumulated OCI into income, effective portion | $ 500,000 | ||||||
[1] | The effective interest rate disclosed above for this series of Senior Notes excludes the impact of the treasury rate lock hedge discussed below. The effective interest rate including the impact of the treasury rate lock hedge was 4.626%. |
Derivative Instruments and He92
Derivative Instruments and Hedging Activities - Derivative Instruments Gain (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Derivative [Line Items] | ||
Gains in accumulated OCI on derivatives (effective portion) | $ 13,745 | $ 1,641 |
Gains reclassified from accumulated OCI into income (effective portion): | (6,615) | (4,145) |
Designated as Hedging Instrument | ||
Derivative [Line Items] | ||
Gains reclassified from accumulated OCI into income (effective portion): | 6,615 | 4,145 |
Designated as Hedging Instrument | Other Comprehensive Income (Loss) | ||
Derivative [Line Items] | ||
Gains in accumulated OCI on derivatives (effective portion) | 13,745 | 1,641 |
Designated as Hedging Instrument | Revenues | ||
Derivative [Line Items] | ||
Gains reclassified from accumulated OCI into income (effective portion): | 7,615 | 3,851 |
Designated as Hedging Instrument | Costs of revenues | ||
Derivative [Line Items] | ||
Gains reclassified from accumulated OCI into income (effective portion): | (1,503) | 294 |
Designated as Hedging Instrument | Interest Expense | ||
Derivative [Line Items] | ||
Gains reclassified from accumulated OCI into income (effective portion): | 503 | 0 |
Designated as Hedging Instrument | Interest income and other, net | ||
Derivative [Line Items] | ||
Gains recognized in income on derivatives (ineffective portion and amount excluded from effectiveness testing) | 243 | 18 |
Not Designated as Hedging Instrument | Interest income and other, net | ||
Derivative [Line Items] | ||
Gains recognized in income | 13,976 | 2,856 |
Not Designated as Hedging Instrument | Gain (Loss) On Extinguishment Of Debt And Other, Net | ||
Derivative [Line Items] | ||
Gains recognized in income | $ (1,180) | $ 0 |
Derivative Instruments and He93
Derivative Instruments and Hedging Activities - Schedule of Notional Amounts (Details) - Cash Flow Hedging - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 |
Cash Flow Hedging / Purchase | ||
Derivative [Line Items] | ||
Cash flow hedge contracts, purchase | $ 32,775 | $ 6,066 |
Cash Flow Hedging / Purchase | Foreign Exchange Forward | ||
Derivative [Line Items] | ||
Derivative, notional amount | 64,012 | 108,901 |
Cash Flow Hedging / Sell | ||
Derivative [Line Items] | ||
Cash flow hedge contracts, sell | 88,800 | 33,999 |
Cash Flow Hedging / Sell | Foreign Exchange Forward | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 123,091 | $ 106,322 |
Derivative Instruments and He94
Derivative Instruments and Hedging Activities - Schedule of Derivative Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 |
Derivative [Line Items] | ||
Derivative asset, fair value, gross asset | $ 3,064 | $ 666 |
Derivative liability, fair value, gross liability | 3,106 | 898 |
Other Current Assets | ||
Derivative [Line Items] | ||
Derivative asset, fair value, gross asset | 3,064 | 666 |
Other Current Liabilities | ||
Derivative [Line Items] | ||
Derivative liability, fair value, gross liability | 3,106 | 898 |
Designated as Hedging Instrument | Other Current Assets | ||
Derivative [Line Items] | ||
Foreign currency contract, asset, fair value disclosure | 1,722 | 120 |
Derivative asset, fair value, gross asset | 1,722 | 120 |
Designated as Hedging Instrument | Other Current Liabilities | ||
Derivative [Line Items] | ||
Foreign currency contracts, liability, fair value disclosure | 1,920 | 100 |
Derivative liability, fair value, gross liability | 1,920 | 100 |
Not Designated as Hedging Instrument | Other Current Assets | ||
Derivative [Line Items] | ||
Foreign currency contract, asset, fair value disclosure | 1,342 | 546 |
Derivative asset, fair value, gross asset | 1,342 | 546 |
Not Designated as Hedging Instrument | Other Current Liabilities | ||
Derivative [Line Items] | ||
Foreign currency contracts, liability, fair value disclosure | 1,186 | 798 |
Derivative liability, fair value, gross liability | $ 1,186 | $ 798 |
Derivative Instruments and He95
Derivative Instruments and Hedging Activities - Derivative Activity in Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Jun. 30, 2015 | Jun. 30, 2014 | |
Accumulated Other Comprehensive Income [Roll Forward] | ||
Beginning balance | $ (20) | $ 2,484 |
Amount reclassified to income | (6,615) | (4,145) |
Net change in unrealized gains or losses | 13,745 | 1,641 |
Ending balance | $ 7,110 | $ (20) |
Derivative Instruments and He96
Derivative Instruments and Hedging Activities - Offsetting of Derivative Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2015 | Jun. 30, 2014 |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | ||
Derivative asset, fair value, gross asset | $ 3,064 | $ 666 |
Derivatives - assets, gross amounts of derivatives offset in the consolidated balance sheets | 0 | 0 |
Derivatives - assets, net amount of derivatives presented in the consolidated balance sheets | 3,064 | 666 |
Derivatives - assets, financial instruments | (2,809) | (423) |
Derivatives - assets, cash collateral received | 0 | 0 |
Derivatives - assets, net amount | 255 | 243 |
Derivative liability, fair value, gross liability | (3,106) | (898) |
Derivatives - liabilities, gross amounts of derivatives offset in the consolidated balance sheets | 0 | 0 |
Derivatives - liabilities, net amount of derivatives presented in the consolidated balance sheets | (3,106) | (898) |
Derivatives - liabilities, financial instruments | 2,809 | 423 |
Derivatives - liabilities, cash collateral received | 0 | 0 |
Derivatives - liabilities, net amount | $ (297) | $ (475) |
Segment Reporting and Geograp97
Segment Reporting and Geographic Information (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Sep. 30, 2013USD ($) | Jun. 30, 2015USD ($)customersegment | Jun. 30, 2014USD ($)customer | Jun. 30, 2013USD ($)customer | |
Segment Reporting and Geographic Information | |||||||||||
Number of Reportable Segments | segment | 1 | ||||||||||
Revenues | $ 756,332 | $ 738,459 | $ 676,357 | $ 642,901 | $ 734,343 | $ 831,599 | $ 705,129 | $ 658,337 | $ 2,814,049 | $ 2,929,408 | $ 2,842,781 |
Number of customers with significant revenue | customer | 3 | 3 | 2 | ||||||||
Percent of total revenues | 100.00% | 100.00% | 100.00% | ||||||||
Long-lived assets | 314,591 | 330,263 | $ 314,591 | $ 330,263 | |||||||
Customer One | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Percent of total revenues | 15.00% | 18.00% | 23.00% | ||||||||
Customer Two | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Percent of total revenues | 12.00% | 14.00% | 13.00% | ||||||||
Customer Three | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Percent of total revenues | 11.00% | 11.00% | |||||||||
Defect Inspection | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 1,541,422 | $ 1,685,114 | $ 1,594,128 | ||||||||
Percent of total revenues | 55.00% | 58.00% | 56.00% | ||||||||
Metrology | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 492,175 | $ 532,002 | $ 540,835 | ||||||||
Percent of total revenues | 18.00% | 18.00% | 19.00% | ||||||||
Service | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 688,653 | $ 642,971 | $ 595,634 | ||||||||
Percent of total revenues | 24.00% | 22.00% | 21.00% | ||||||||
Other | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 91,799 | $ 69,321 | $ 112,184 | ||||||||
Percent of total revenues | 3.00% | 2.00% | 4.00% | ||||||||
North America | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 815,914 | $ 705,159 | $ 846,125 | ||||||||
Percent of total revenues | 29.00% | 24.00% | 30.00% | ||||||||
Taiwan | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 691,482 | $ 741,470 | $ 936,445 | ||||||||
Percent of total revenues | 25.00% | 25.00% | 33.00% | ||||||||
Japan | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 426,963 | $ 334,653 | $ 310,204 | ||||||||
Percent of total revenues | 15.00% | 11.00% | 11.00% | ||||||||
Europe & Israel | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 194,670 | $ 306,779 | $ 211,121 | ||||||||
Percent of total revenues | 7.00% | 11.00% | 7.00% | ||||||||
Korea | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 405,320 | $ 371,139 | $ 292,724 | ||||||||
Percent of total revenues | 14.00% | 13.00% | 10.00% | ||||||||
Rest of Asia | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Revenues | $ 279,700 | $ 470,208 | $ 246,162 | ||||||||
Percent of total revenues | 10.00% | 16.00% | 9.00% | ||||||||
Long-lived assets | 10,991 | 9,130 | $ 10,991 | $ 9,130 | |||||||
United States | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Long-lived assets | 207,779 | 219,280 | 207,779 | 219,280 | |||||||
Europe | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Long-lived assets | 16,536 | 19,527 | 16,536 | 19,527 | |||||||
Singapore | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Long-lived assets | 45,444 | 48,938 | 45,444 | 48,938 | |||||||
Israel | |||||||||||
Segment Reporting and Geographic Information | |||||||||||
Long-lived assets | $ 33,841 | $ 33,388 | $ 33,841 | $ 33,388 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |
Related Party Transaction, Due from (to) Related Party [Abstract] | |||
Total revenues | $ 1,856 | $ 2,701 | $ 6,854 |
Total purchases | 1,098 | 2,622 | $ 4,460 |
Receivable balance from related parties | $ 100 | $ 1,800 |
Subsequent Events (Details)
Subsequent Events (Details) - $ / shares | Aug. 06, 2015 | Jul. 14, 2015 | May. 07, 2015 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 |
Subsequent Events | ||||||
Cash dividends declared per share (in dollars per share) | $ 18.5 | $ 1.8 | $ 1.6 | |||
Regular Cash Dividend | ||||||
Subsequent Events | ||||||
Cash dividends declared per share (in dollars per share) | $ 0.50 | |||||
Regular Cash Dividend | Subsequent Event | ||||||
Subsequent Events | ||||||
Cash dividends declared per share (in dollars per share) | $ 0.52 | $ 0.52 |
Quarterly Consolidated Resul100
Quarterly Consolidated Results of Operations (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2015 | Jun. 30, 2014 | Jun. 30, 2013 | |||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Total revenues | $ 756,332 | $ 738,459 | $ 676,357 | $ 642,901 | $ 734,343 | $ 831,599 | $ 705,129 | $ 658,337 | $ 2,814,049 | $ 2,929,408 | $ 2,842,781 | ||||||||
Gross margin | 433,065 | 418,177 | 393,144 | 354,434 | 407,678 | 488,773 | 419,315 | 380,680 | |||||||||||
Net income | $ 142,019 | $ 131,638 | $ 20,268 | $ 72,233 | $ 128,731 | $ 203,581 | $ 139,246 | $ 111,197 | $ 366,158 | $ 582,755 | $ 543,149 | ||||||||
Net income per share: | |||||||||||||||||||
Basic (in dollars per share) | $ 0.90 | [1] | $ 0.81 | [1] | $ 0.12 | [1] | $ 0.44 | [1] | $ 0.78 | [1] | $ 1.22 | [1] | $ 0.84 | [1] | $ 0.67 | [1] | $ 2.26 | $ 3.51 | $ 3.27 |
Diluted (in dollars per share) | $ 0.89 | [1] | $ 0.81 | [1] | $ 0.12 | [1] | $ 0.43 | [1] | $ 0.77 | [1] | $ 1.21 | [1] | $ 0.83 | [1] | $ 0.66 | [1] | $ 2.24 | $ 3.47 | $ 3.21 |
Recapitalization costs | $ 2,500 | ||||||||||||||||||
Senior Notes | Senior Notes Due May 1, 2018 | |||||||||||||||||||
Net income per share: | |||||||||||||||||||
Gains (losses) on extinguishment of debt | $ 131,700 | ||||||||||||||||||
[1] | Basic and diluted earnings per share are computed independently for each of the quarters presented based on the weighted-average basic and fully diluted shares outstanding for each quarter. Therefore, the sum of quarterly basic and diluted per share information may not equal annual basic and diluted earnings per share. |