Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Oct. 03, 2015 | Oct. 28, 2015 | |
Entity Information [Line Items] | ||
Entity Registrant Name | CERNER CORP /MO/ | |
Entity Central Index Key | 804,753 | |
Document Type | 10-Q | |
Document Period End Date | Oct. 3, 2015 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Current Fiscal Year End Date | --01-02 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 342,104,727 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Oct. 03, 2015 | Jan. 03, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 261,757 | $ 635,203 |
Short-term investments | 202,780 | 785,663 |
Receivables, net | 1,053,134 | 672,778 |
Inventory | 23,702 | 23,789 |
Prepaid expenses and other | 245,122 | 209,278 |
Deferred income taxes, net | 17,267 | 22,075 |
Total current assets | 1,803,762 | 2,348,786 |
Property and equipment, net | 1,187,114 | 924,260 |
Software development costs, net | 532,085 | 420,199 |
Goodwill | 788,943 | 320,538 |
Intangible assets, net | 716,688 | 126,636 |
Long-term investments | 301,023 | 231,147 |
Other assets | 193,310 | 158,999 |
Total assets | 5,522,925 | 4,530,565 |
Current liabilities: | ||
Accounts payable | 207,887 | 160,285 |
Current installments of long-term debt and capital lease obligations | 57,841 | 67,460 |
Deferred revenue | 265,642 | 209,655 |
Accrued payroll and tax withholdings | 202,791 | 140,230 |
Other accrued expenses | 105,174 | 56,685 |
Total current liabilities | 839,335 | 634,315 |
Long-term Debt and Capital Lease Obligations | 572,828 | 62,868 |
Deferred income taxes and other liabilities | 246,711 | 256,601 |
Deferred revenue | 26,726 | 10,813 |
Total liabilities | 1,685,600 | 964,597 |
Shareholders' Equity: | ||
Common stock, $.01 par value, 500,000,000 shares authorized, 349,934,335 shares issued at October 3, 2015 and 346,985,811 shares issued at January 3, 2015 | 3,499 | 3,470 |
Additional paid-in capital | 1,052,130 | 933,446 |
Retained earnings | 3,291,735 | 2,918,481 |
Treasury stock, 7,882,838 shares at October 3, 2015 and 4,652,515 shares at January 3, 2015 | (445,397) | (245,333) |
Accumulated other comprehensive loss, net | (64,642) | (44,096) |
Total shareholders' equity | 3,837,325 | 3,565,968 |
Total liabilities and shareholders' equity | $ 5,522,925 | $ 4,530,565 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Oct. 03, 2015 | Jan. 03, 2015 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 349,934,335 | 346,985,811 |
Treasury Stock, Shares | 7,882,838 | 4,652,515 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Revenues: | ||||
System sales | $ 325,084 | $ 224,345 | $ 899,762 | $ 665,595 |
Support, maintenance and services | 783,878 | 593,068 | 2,295,075 | 1,738,664 |
Reimbursed travel | 18,925 | 22,736 | 55,136 | 72,413 |
Total revenues | 1,127,887 | 840,149 | 3,249,973 | 2,476,672 |
Costs and expenses: | ||||
Cost of system sales | 105,760 | 65,520 | 309,761 | 211,939 |
Cost of support, maintenance and services | 65,898 | 51,809 | 186,668 | 147,181 |
Cost of reimbursed travel | 18,925 | 22,736 | 55,136 | 72,413 |
Sales and client service | 465,881 | 346,417 | 1,349,498 | 1,020,552 |
Software development (Includes amortization of $29,743 and $88,450 for the three and nine months ended October 3, 2015; and $25,372 and $75,410 for the three and nine months ended September 27, 2014) | 132,814 | 97,026 | 398,536 | 285,897 |
General and administrative | 98,705 | 64,877 | 329,061 | 170,834 |
Amortization of acquisition-related intangibles | 24,550 | 3,610 | 67,311 | 10,066 |
Total costs and expenses | 912,533 | 651,995 | 2,695,971 | 1,918,882 |
Operating earnings | 215,354 | 188,154 | 554,002 | 557,790 |
Other income (expense), net | 317 | 2,181 | (554) | 7,908 |
Earnings before income taxes | 215,671 | 190,335 | 553,448 | 565,698 |
Income taxes | (68,389) | (61,333) | (180,194) | (188,137) |
Net earnings | $ 147,282 | $ 129,002 | $ 373,254 | $ 377,561 |
Basic earnings per share | $ 0.43 | $ 0.38 | $ 1.09 | $ 1.10 |
Diluted earnings per share | $ 0.42 | $ 0.37 | $ 1.06 | $ 1.08 |
Basic weighted average shares outstanding | 344,040 | 341,188 | 343,933 | 342,254 |
Diluted weighted average shares outstanding | 351,364 | 349,326 | 351,891 | 350,468 |
Consolidated Statements Of Ope5
Consolidated Statements Of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Income Statement [Abstract] | ||||
Software development, amortization | $ 29,743 | $ 25,372 | $ 88,450 | $ 75,410 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | ||||
Net earnings | $ 147,282 | $ 129,002 | $ 373,254 | $ 377,561 |
Foreign currency translation adjustment and other (net of tax benefit of $824 and $3,053 for the three and nine months ended October 3, 2015; and $922 and $603 for the three and nine months ended September 27, 2014) | (7,944) | (17,672) | (20,838) | (9,603) |
Unrealized holding gain (loss) on available-for-sale investments (net of taxes (benefit) of $73 and $186 for the three and nine months ended October 3, 2015; and $(259) and $(252) for the three and nine months ended September 27, 2014) | 118 | (409) | 292 | (397) |
Comprehensive income | $ 139,456 | $ 110,921 | $ 352,708 | $ 367,561 |
Consolidated Statements Of Com7
Consolidated Statements Of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Foreign currency translation adjustment and other, (taxes) benefit | $ 824 | $ 922 | $ 3,053 | $ 603 |
Change in net unrealized holding gain (loss) on available-for-sale investments, taxes (benefit) | $ 73 | $ (259) | $ 186 | $ (252) |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 9 Months Ended | |
Oct. 03, 2015 | Sep. 27, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net earnings | $ 373,254 | $ 377,561 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 329,075 | 217,212 |
Share-based compensation expense | 53,326 | 43,330 |
Provision for deferred income taxes | 4,671 | 21,712 |
Changes in assets and liabilities (net of businesses acquired): | ||
Receivables, net | (176,120) | (36,562) |
Inventory | 5,165 | 3,515 |
Prepaid expenses and other | (41,741) | 9,862 |
Accounts payable | (7,632) | 20,137 |
Accrued income taxes | 2,596 | (2,038) |
Deferred revenue | (3,008) | 7,361 |
Other accrued liabilities | 54,845 | (38,511) |
Net cash provided by operating activities | 594,431 | 623,579 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital purchases | (255,375) | (200,372) |
Capitalized software development costs | (204,708) | (130,761) |
Purchases of investments | (460,128) | (1,069,938) |
Sales and maturities of investments | 962,760 | 1,224,063 |
Purchase of other intangibles | (18,092) | (10,238) |
Acquisition of businesses | (1,372,014) | (7,476) |
Net cash used in investing activities | (1,347,557) | (194,722) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Long-term debt issuance | 500,000 | 0 |
Repayment of long-term debt and capital lease obligations | 0 | (75) |
Proceeds from excess tax benefits from share-based compensation | 57,689 | 26,079 |
Proceeds from exercise of options | 42,481 | 19,423 |
Treasury stock purchases | (200,064) | (217,082) |
Contingent consideration payments for acquisition of businesses | (11,012) | (10,617) |
Cash Grants | 0 | 48,000 |
Other | (792) | 2,894 |
Net cash provided by (used in) financing activities | 388,302 | (131,378) |
Effect of exchange rate changes on cash and cash equivalents | (8,622) | (3,362) |
Net increase (decrease) in cash and cash equivalents | (373,446) | 294,117 |
Cash and cash equivalents at beginning of period | 635,203 | 202,377 |
Cash and cash equivalents at end of period | 261,757 | 496,494 |
Summary of acquisition transactions: | ||
Fair value of tangible assets acquired | 450,662 | 184 |
Fair value of intangible assets acquired | 637,980 | 3,800 |
Fair value of goodwill | 472,476 | 16,785 |
Less: Fair value of liabilities assumed | (167,989) | (1,693) |
Less: Fair value of contingent liability payable | 0 | (11,600) |
Less: Fair value of working capital settlement payable | (21,115) | 0 |
Net cash used | $ 1,372,014 | $ 7,476 |
Acquisitions
Acquisitions | 9 Months Ended |
Oct. 03, 2015 | |
Business Combinations [Abstract] | |
Business Acquisitions | Business Acquisitions Siemens Health Services On February 2, 2015 , we acquired substantially all of the assets, and assumed certain liabilities of Siemens Health Services , the health information technology business unit of Siemens AG ("Siemens"), a stock corporation established under the laws of Germany, and its affiliates. Siemens Health Services offered a portfolio of enterprise-level clinical and financial health care information technology solutions, as well as departmental, connectivity, population health, and care coordination solutions globally. Solutions were offered on the Soarian®, Invision®, and i.s.h.med® platforms, among others. Siemens Health Services also offered a range of complementary services including support, hosting, managed services, implementation services, and strategic consulting. We believe the acquisition enhances our organic growth opportunities as it provides us a larger base into which we can sell our combined portfolio of solutions and services. The acquisition also augments our non-U.S. footprint and growth opportunities, increases our scale for R&D investment, and adds over 5,000 highly-skilled associates that will enhance our capabilities. These factors, combined with the synergies and economies of scale expected from combining the operations of Cerner and Siemens Health Services, are the basis for the acquisition and comprise the resulting goodwill recorded. Consideration for the acquisition was $1.39 billion of cash, which includes a $21 million post-closing adjustment agreed upon in September 2015. The adjustment settles working capital and certain other obligations under the Master Sale and Purchase Agreement dated August 5, 2014 , as amended. Such amount was remitted to Siemens in October 2015, and is included in other accrued expenses in our condensed consolidated balance sheets as of October 3, 2015. During the nine months ended October 3, 2015 , we incurred $20 million of pre-tax acquisition costs in connection with the acquisition of Siemens Health Services, which are included in general and administrative expenses in our condensed consolidated statements of operations. The acquisition of Siemens Health Services is being treated as a purchase in accordance with ASC Topic 805, Business Combinations , which requires allocation of the purchase price to the estimated fair values of the assets acquired and liabilities assumed in the transaction. Our allocation of purchase price is based on management's judgment after evaluating several factors, including a preliminary valuation assessment. The allocation of purchase price is preliminary and subject to changes, which could be significant, as appraisals of tangible and intangible assets are finalized, and additional information becomes available. The preliminary allocation of purchase price is as follows: (in thousands) Allocation Amount Estimated Weighted Average Useful Life Receivables, net of allowances of $33,674 $ 235,284 Other current assets 56,859 Property and equipment 158,288 20 years Goodwill 472,476 Intangible assets: Customer relationships 396,000 10 years Existing technologies 201,990 5 years Trade names 39,990 8 years Total intangible assets 637,980 Other non-current assets 231 Accounts payable (42,513 ) Deferred revenue (current) (90,148 ) Other current liabilities (20,398 ) Deferred revenue (non-current) (14,930 ) Total purchase price $ 1,393,129 The intangible assets in the table above are being amortized on a straight-line basis over their estimated useful lives, with such amortization included in amortization of acquisition-related intangibles in our condensed consolidated statements of operations. The fair value measurements of tangible and intangible assets and liabilities were based on significant inputs not observable in the market and thus represent Level 3 measurements within the fair value measurement hierarchy. Level 3 inputs included, among others, discount rates that we estimated would be used by a market participant in valuing these assets and liabilities, projections of revenues and cash flows, client attrition rates, royalty rates, and market comparables. Property and equipment was valued primarily using the sales comparison method, a form of the market approach, in which the value is derived by evaluating the market prices of assets with comparable features such as size, location, condition and age. Our analysis included multiple property categories, including land, buildings, and personal property and included assumptions for market prices of comparable assets, and physical and economic obsolescence, among others. Customer relationship intangible assets were valued using the excess earnings method, a form of the income approach, in which the value is derived by estimation of the after-tax cash flows specifically attributable to the customer relationships. Our analysis consisted of two customer categories, order backlog and existing customer relationships and included assumptions for projections of revenues and expenses, contributory asset charges, discount rates, and a tax amortization benefit, among others. Existing technology and trade name intangible assets were valued using the relief from royalty method, a form of the income approach, in which the value is derived by estimation of the after-tax royalty savings attributable to owning the assets. Assumptions in these analyses included projections of revenues, royalty rates representing costs avoided due to ownership of the assets, discount rates, and a tax amortization benefit. Deferred revenue was valued using an income approach, in which the value was derived by estimation of the fulfillment cost, plus a normal profit margin (which excludes any selling margin), for performance obligations assumed in the acquisition. Assumptions included estimations of costs incurred to fulfill the obligations, profit margins a market participant would expect to receive, and a discount rate. The goodwill of $472 million was allocated among our Domestic and Global operating segments, as shown below, and is expected to be deductible for tax purposes. The changes in the carrying amounts of goodwill for the nine months ended October 3, 2015 were as follows: (In thousands) Domestic Global Total Beginning balance $ 311,170 $ 9,368 $ 320,538 Goodwill recorded in connection with the Siemens Health Services acquisition 410,149 62,327 472,476 Foreign currency translation adjustments and other — (4,071 ) (4,071 ) Ending balance at October 3, 2015 $ 721,319 $ 67,624 $ 788,943 Our condensed consolidated statements of operations for the three and nine months ended October 3, 2015 include revenues of approximately $250 million and $685 million , respectively, attributable to the acquired business (now referred to as "Cerner Health Services") since the February 2, 2015 acquisition date. Disclosure of the earnings contribution from the Cerner Health Services business is not practicable, as we have already integrated operations in many areas. The following table provides unaudited pro forma results of operations for the three and nine months ended October 3, 2015 and September 27, 2014 , as if the acquisition had been completed on the first day of our 2014 fiscal year. Three Months Ended Nine Months Ended (In thousands, except per share data) 2015 2014 2015 2014 Pro forma revenues $ 1,127,887 $ 1,131,290 $ 3,343,653 $ 3,341,952 Pro forma net earnings 147,680 113,804 379,059 326,936 Pro forma diluted earnings per share 0.42 0.33 1.08 0.93 These pro forma results are based on estimates and assumptions, which we believe are reasonable. They are not the results that would have been realized had we been a combined company during the periods presented, nor are they indicative of our consolidated results of operations in future periods. The pro forma results for the three months ended October 3, 2015 include a pre-tax adjustment to eliminate $1 million of acquisition costs. The pro forma results for the nine months ended October 3, 2015 include pre-tax adjustments for amortization of intangible assets, fair value adjustments for deferred revenue, and the elimination of acquisition costs of $7 million , $6 million and $20 million , respectively. Pro forma results for the three months ended September 27, 2014 include pre-tax adjustments for amortization of intangible assets and fair value adjustments for deferred revenue of $22 million and $9 million , respectively. The pro forma results for the nine months ended September 27, 2014 include pre-tax adjustments for amortization of intangible assets and fair value adjustments for deferred revenue of $65 million and $34 million , respectively. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Oct. 03, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We determine fair value measurements used in our consolidated financial statements based upon the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). 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. The following table details our financial assets measured and recorded at fair value on a recurring basis at October 3, 2015 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 33,888 $ — $ — Time deposits Cash equivalents — 4,590 — Government and corporate bonds Cash equivalents — 200 — Time deposits Short-term investments — 50,062 — Commercial paper Short-term investments — 2,500 — Government and corporate bonds Short-term investments — 150,218 — Government and corporate bonds Long-term investments — 284,972 — The following table details our financial assets measured and recorded at fair value on a recurring basis at January 3, 2015 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 189,137 $ — $ — Time deposits Cash equivalents — 9,989 — Commercial paper Cash equivalents — 115,638 — Time deposits Short-term investments — 52,829 — Commercial paper Short-term investments — 435,544 — Government and corporate bonds Short-term investments — 297,290 — Government and corporate bonds Long-term investments — 218,965 — We estimate the fair value of our long-term, fixed rate debt using a Level 3 discounted cash flow analysis based on current borrowing rates for debt with similar maturities. We estimate the fair value of our long-term, variable rate debt using a Level 3 discounted cash flow analysis based on LIBOR rate forward curves. The fair value of our long-term debt, including current maturities, at October 3, 2015 and January 3, 2015 was approximately $523 million and $15 million , respectively. The carrying amount of such debt at October 3, 2015 and January 3, 2015 was $514 million and $14 million , respectively. |
Investments
Investments | 9 Months Ended |
Oct. 03, 2015 | |
Investments [Abstract] | |
Investments | Available-for-sale Investments Available-for-sale investments at October 3, 2015 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 33,888 $ — $ — $ 33,888 Time deposits 4,590 — — 4,590 Government and corporate bonds 200 — — 200 Total cash equivalents 38,678 — — 38,678 Short-term investments: Time deposits 50,062 — — 50,062 Commercial paper 2,500 — — 2,500 Government and corporate bonds 150,184 75 (41 ) 150,218 Total short-term investments 202,746 75 (41 ) 202,780 Long-term investments: Government and corporate bonds 285,034 199 (261 ) 284,972 Total available-for-sale investments $ 526,458 $ 274 $ (302 ) $ 526,430 Available-for-sale investments at January 3, 2015 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 189,137 $ — $ — $ 189,137 Time deposits 9,989 — — 9,989 Commercial paper 115,638 — — 115,638 Total cash equivalents 314,764 — — 314,764 Short-term investments: Time deposits 52,830 — (1 ) 52,829 Commercial paper 435,555 1 (12 ) 435,544 Government and corporate bonds 297,311 69 (90 ) 297,290 Total short-term investments 785,696 70 (103 ) 785,663 Long-term investments: Government and corporate bonds 219,439 26 (500 ) 218,965 Total available-for-sale investments $ 1,319,899 $ 96 $ (603 ) $ 1,319,392 We sold available-for-sale investments for proceeds of $157 million and $660 million during the nine months ended October 3, 2015 and September 27, 2014 , respectively, resulting in insignificant gains in each period. |
Receivables
Receivables | 9 Months Ended |
Oct. 03, 2015 | |
Receivables [Abstract] | |
Receivables | Receivables A summary of net receivables is as follows: (In thousands) October 3, 2015 January 3, 2015 Gross accounts receivable $ 1,062,253 $ 641,160 Less: Allowance for doubtful accounts 50,107 25,531 Accounts receivable, net of allowance 1,012,146 615,629 Current portion of lease receivables 40,988 57,149 Total receivables, net $ 1,053,134 $ 672,778 During the second quarter of 2008, Fujitsu Services Limited’s (Fujitsu) contract as the prime contractor in the National Health Service (NHS) initiative to automate clinical processes and digitize medical records in the Southern region of England was terminated by the NHS. This had the effect of automatically terminating our subcontract for the project. We continue to be in dispute with Fujitsu regarding Fujitsu’s obligation to pay the amounts comprised of accounts receivable and contracts receivable related to that subcontract, and we are working with Fujitsu to resolve these issues based on processes provided for in the contract. Part of that process requires final resolution of disputes between Fujitsu and the NHS regarding the contract termination. As of October 3, 2015 , it remains unlikely that our matter with Fujitsu will be resolved in the next 12 months. Therefore, these receivables have been classified as long-term and represent less than the majority of other long-term assets at October 3, 2015 and January 3, 2015 . While the ultimate collectability of the receivables pursuant to this process is uncertain, we believe that we have valid and equitable grounds for recovery of such amounts and that collection of recorded amounts is probable. Nevertheless, it is reasonably possible that our estimates regarding collectability of such amounts might materially change in the near term, considering that we do not have complete knowledge of the status of the proceedings between Fujitsu and NHS and their effect on our claim. During the first nine months of 2015 and 2014 , we received total client cash collections of $3.2 billion and $2.6 billion , respectively. |
Income Taxes
Income Taxes | 9 Months Ended |
Oct. 03, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We determine the tax provision for interim periods using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Our effective tax rate was 32.6% and 33.3% for the first nine months of 2015 and 2014 , respectively. The decrease in the 2015 effective tax rate results principally from the favorability of net discrete items recorded in 2015 as compared to 2014. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Oct. 03, 2015 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share A reconciliation of the numerators and the denominators of the basic and diluted per share computations are as follows: Three Months Ended 2015 2014 Earnings Shares Per-Share Earnings Shares Per-Share (In thousands, except per share data) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic earnings per share: Income available to common shareholders $ 147,282 344,040 $ 0.43 $ 129,002 341,188 $ 0.38 Effect of dilutive securities: Stock options and non-vested shares — 7,324 — 8,138 Diluted earnings per share: Income available to common shareholders including assumed conversions $ 147,282 351,364 $ 0.42 $ 129,002 349,326 $ 0.37 For the three months ended October 3, 2015 and September 27, 2014 , options to purchase 3.9 million and 6.7 million shares of common stock at per share prices ranging from $48.39 to $73.40 and $38.66 to $60.37 , respectively, were outstanding but were not included in the computation of diluted earnings per share because they were anti-dilutive. Nine Months Ended 2015 2014 Earnings Shares Per-Share Earnings Shares Per-Share (In thousands, except per share data) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic earnings per share: Income available to common shareholders $ 373,254 343,933 $ 1.09 $ 377,561 342,254 $ 1.10 Effect of dilutive securities: Stock options and non-vested shares — 7,958 — 8,214 Diluted earnings per share: Income available to common shareholders including assumed conversions $ 373,254 351,891 $ 1.06 $ 377,561 350,468 $ 1.08 For the nine months ended October 3, 2015 and September 27, 2014 , options to purchase 2.5 million and 5.4 million shares of common stock at per share prices ranging from $51.97 to $73.40 and $38.66 to $60.37 , respectively, were outstanding but were not included in the computation of diluted earnings per share because they were anti-dilutive. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Oct. 03, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation and Equity | Share-Based Compensation and Equity Stock Options Options activity for the nine months ended October 3, 2015 was as follows: (In thousands, except per share data) Number of Shares Weighted- Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Term (Yrs) Outstanding at beginning of year 24,629 $ 27.00 Granted 3,169 68.21 Exercised (3,345 ) 15.24 Forfeited and expired (262 ) 47.57 Outstanding as of October 3, 2015 24,191 33.81 $ 687,701 6.11 Exercisable as of October 3, 2015 13,813 $ 19.30 $ 580,713 4.51 The weighted-average assumptions used to estimate the fair value, under the Black-Scholes-Merton pricing model, of stock options granted during the nine months ended October 3, 2015 were as follows: Expected volatility (%) 27.4 % Expected term (yrs) 7 Risk-free rate (%) 1.8 % Fair value per option $ 21.85 As of October 3, 2015 , there was $158 million of total unrecognized compensation cost related to stock options granted under all plans. That cost is expected to be recognized over a weighted-average period of 3.39 years. Non-vested Shares Non-vested share activity for the nine months ended October 3, 2015 was as follows: (In thousands, except per share data) Number of Shares Weighted-Average Grant Date Fair Value Outstanding at beginning of year 506 $ 46.21 Granted 293 69.21 Vested (184 ) 44.91 Forfeited (57 ) 43.37 Outstanding as of October 3, 2015 558 $ 59.07 As of October 3, 2015 , there was $19 million of total unrecognized compensation cost related to non-vested share awards granted under all plans. That cost is expected to be recognized over a weighted-average period of 1.77 years. The following table presents total compensation expense recognized with respect to stock options, non-vested shares and our associate stock purchase plan: Three Months Ended Nine Months Ended (In thousands) 2015 2014 2015 2014 Stock option and non-vested share compensation expense $ 18,875 $ 15,061 $ 53,326 $ 43,330 Associate stock purchase plan expense 1,485 1,109 4,238 3,486 Amounts capitalized in software development costs, net of amortization (183 ) (171 ) (483 ) (845 ) Amounts charged against earnings, before income tax benefit $ 20,177 $ 15,999 $ 57,081 $ 45,971 Amount of related income tax benefit recognized in earnings $ 6,398 $ 5,616 $ 18,595 $ 16,136 Treasury Stock 2013 Repurchase Program In May 2014, our Board of Directors approved an amendment to the share repurchase program that was authorized in December 2013. Under the amendment, the Company was authorized to repurchase shares of our common stock up to an aggregate of $317 million , excluding transaction costs. During the nine months ended October 3, 2015 , we repurchased 1.6 million shares for consideration of $100 million , excluding transaction costs. These shares were recorded as treasury shares and accounted for under the cost method. No repurchased shares have been retired. As of October 3, 2015 , the program is complete. 2015 Repurchase Program In September 2015, our Board of Directors authorized a share repurchase program for an aggregate purchase of up to $245 million of our common stock. The repurchases are to be effectuated in the open market, by block purchase, or possibly through other transactions managed by broker-dealers. No time limit was set for completion of the program. During the nine months ended October 3, 2015 , we repurchased 1.6 million shares for consideration of $100 million , excluding transaction costs. These shares were recorded as treasury stock and accounted for under the cost method. No repurchased shares have been retired. At October 3, 2015 , $145 million remains available for purchase. |
Indebtedness (Notes)
Indebtedness (Notes) | 9 Months Ended |
Oct. 03, 2015 | |
Debt Disclosure [Abstract] | |
Debt and Capital Leases Disclosures [Text Block] | Long-Term Debt and Capital Lease Obligations The following is a summary of indebtedness outstanding: (In thousands) October 3, 2015 January 3, 2015 Note agreement, 5.54% $ 14,095 $ 14,233 Senior Notes 500,000 — Capital lease obligations 104,018 116,095 Other 13,297 — Debt and capital lease obligations 631,410 130,328 Less: debt issuance costs (741 ) — Debt and capital lease obligations, net 630,669 130,328 Less: current portion (57,841 ) (67,460 ) Long-term debt and capital lease obligations $ 572,828 $ 62,868 Senior Notes In January 2015, we issued $500 million aggregate principal amount of unsecured Senior Notes ("Notes"), pursuant to a Master Note Purchase Agreement dated December 4, 2014. The issuance consisted of $225 million of 3.18% Series 2015-A Notes due February 15, 2022 , $200 million of 3.58% Series 2015-B Notes due February 14, 2025 , and $75 million in floating rate Series 2015-C Notes due February 15, 2022 . Interest is payable semiannually on February 15th and August 15th in each year, commencing on August 15, 2015 , for the Series 2015-A Notes and Series 2015-B Notes. The Series 2015-C Notes will accrue interest at a floating rate equal to the Adjusted LIBOR Rate (as defined in the Master Note Purchase Agreement), payable quarterly on February 15th, May 15th, August 15th and November 15th in each year, commencing on May 15, 2015 . As of October 3, 2015 , the interest rate was 1.32% for the current interest period based on the three-month floating LIBOR rate. The debt issuance costs in the table above relate to the issuance of these Notes. The Master Note Purchase Agreement contains certain leverage and interest coverage ratio covenants and provides certain restrictions on our ability to borrow, incur liens, sell assets, and other customary terms. Proceeds from the Notes are available for general corporate purposes. Credit Facility In October 2015, we amended and restated our revolving credit facility. The amended facility provides a $100 million unsecured revolving line of credit for working capital purposes, which includes a letter of credit facility, expiring in October 2020 . We have the ability to increase the maximum capacity to $200 million at any time during the facility’s term, subject to lender participation. Interest is payable at a rate based on prime, LIBOR, or the U.S. federal funds rate, plus a spread that varies depending on the leverage ratios maintained. The agreement provides certain restrictions on our ability to borrow, incur liens, sell assets and pay dividends and contains certain cash flow and debt covenants. Prior to the amendment of this facility, at October 3, 2015 we had no outstanding borrowings; however, we had $16 million of outstanding letters of credit. Covenant Compliance As of October 3, 2015 , we were in compliance with all debt covenants. |
Contingencies
Contingencies | 9 Months Ended |
Oct. 03, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies Disclosure | Contingencies We accrue estimates for resolution of any legal and other contingencies when losses are probable and estimable, in accordance with ASC 450, Contingencies . The terms of our software license agreements with our clients generally provide for a limited indemnification of such clients against losses, expenses and liabilities arising from third party claims based on alleged infringement by our solutions of an intellectual property right of such third party. The terms of such indemnification often limit the scope of and remedies for such indemnification obligations and generally include a right to replace or modify an infringing solution. To date, we have not had to reimburse any of our clients for any judgments or settlements to third parties related to these indemnification provisions pertaining to intellectual property infringement claims. For several reasons, including the lack of prior indemnification claims and the lack of a monetary liability limit for certain infringement cases under the terms of the corresponding agreements with our clients, we cannot determine the maximum amount of potential future payments, if any, related to such indemnification provisions. In addition to commitments and obligations in the ordinary course of business, we are subject to various legal proceedings and claims, including for example, employment disputes and litigation alleging solution defects, personal injury, intellectual property infringement, violations of law and breaches of contract and warranties. Many of these proceedings are at preliminary stages and many seek an indeterminate amount of damages. No less than quarterly, we review the status of each significant matter and assess our potential financial exposure. We accrue a liability for an estimated loss if the potential loss from any legal proceeding or claim is considered probable and the amount can be reasonably estimated. Significant judgment is required in both the determination of probability and the determination as to whether the amount of an exposure is reasonably estimable, and accruals are based only on the information available to our management at the time the judgment is made. Furthermore, the outcome of legal proceedings is inherently uncertain, and we may incur substantial defense costs and expenses defending any of these matters. Should any one or a combination of more than one of these proceedings be successful, or should we determine to settle any or a combination of these matters, we may be required to pay substantial sums, become subject to the entry of an injunction or be forced to change the manner in which we operate our business, which could have a material adverse impact on our financial position or results of operations. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Oct. 03, 2015 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting We have two operating segments, Domestic and Global. Revenues are derived primarily from the sale of clinical, financial and administrative information systems and solutions. The cost of revenues includes the cost of third party consulting services, computer hardware, devices and sublicensed software purchased from manufacturers for delivery to clients. It also includes the cost of hardware maintenance and sublicensed software support subcontracted to the manufacturers. Operating expenses incurred by the geographic business segments consist of sales and client service expenses including salaries of sales and client service personnel, expenses associated with our managed services business, marketing expenses, communications expenses and unreimbursed travel expenses. “Other” includes expenses that have not been allocated to the operating segments, such as software development, general and administrative expenses, acquisition costs and related adjustments, share-based compensation expense, and certain amortization and depreciation. Performance of the segments is assessed at the operating earnings level by our chief operating decision maker, who is our Chief Executive Officer. Items such as interest, income taxes, capital expenditures and total assets are managed at the consolidated level and thus are not included in our operating segment disclosures. Accounting policies for each of the reportable segments are the same as those used on a consolidated basis. In connection with our acquisition of the Cerner Health Services business, we commenced an evaluation of our methodology for allocating operating expenses to our reportable segments. Effective for our first quarter of 2015, certain expenses historically reported in “Other” have been allocated to the geographic segments. This new allocation reflects the manner in which the business is now managed, subsequent to the acquisition. While this reporting change did not impact our consolidated results, the segment data has been recast to be consistent for all periods presented. The following table presents a summary of our operating segments and other expense for the three and nine months ended October 3, 2015 and September 27, 2014 : (In thousands) Domestic Global Other Total Three Months Ended 2015 Revenues $ 997,954 $ 129,933 $ — $ 1,127,887 Cost of revenues 169,181 21,402 — 190,583 Operating expenses 403,371 60,448 258,131 721,950 Total costs and expenses 572,552 81,850 258,131 912,533 Operating earnings (loss) $ 425,402 $ 48,083 $ (258,131 ) $ 215,354 (In thousands) Domestic Global Other Total Three Months Ended 2014 Revenues $ 741,830 $ 98,319 $ — $ 840,149 Cost of revenues 126,223 13,842 — 140,065 Operating expenses 290,799 43,556 177,575 511,930 Total costs and expenses 417,022 57,398 177,575 651,995 Operating earnings (loss) $ 324,808 $ 40,921 $ (177,575 ) $ 188,154 (In thousands) Domestic Global Other Total Nine Months Ended 2015 Revenues $ 2,863,207 $ 386,766 $ — $ 3,249,973 Cost of revenues 480,087 71,478 — 551,565 Operating expenses 1,157,762 170,846 815,798 2,144,406 Total costs and expenses 1,637,849 242,324 815,798 2,695,971 Operating earnings (loss) $ 1,225,358 $ 144,442 $ (815,798 ) $ 554,002 (In thousands) Domestic Global Other Total Nine Months Ended 2014 Revenues $ 2,206,297 $ 270,375 $ — $ 2,476,672 Cost of revenues 389,344 42,189 — 431,533 Operating expenses 848,398 136,474 502,477 1,487,349 Total costs and expenses 1,237,742 178,663 502,477 1,918,882 Operating earnings (loss) $ 968,555 $ 91,712 $ (502,477 ) $ 557,790 |
Interim Statement Presentation
Interim Statement Presentation Organization, Consolidation and Presentation of Financial Statements (Policies) | 9 Months Ended |
Oct. 03, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block] | Interim Statement Presentation Basis of Presentation The condensed consolidated financial statements included herein have been prepared by Cerner Corporation (Cerner, the Company, we, us or our) without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in our latest annual report on Form 10-K. In management’s opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position and the results of operations and cash flows for the periods presented. Our interim results as presented in this Form 10-Q are not necessarily indicative of the operating results for the entire year. The condensed consolidated financial statements were prepared using GAAP. These principles require us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses. Actual results could differ from those estimates. Fiscal Period End Our third fiscal quarter ends on the Saturday closest to September 30. The 2015 and 2014 third quarters ended on October 3, 2015 and September 27, 2014, respectively. All references to years in these notes to condensed consolidated financial statements represent the respective three or nine months ended on such dates, unless otherwise noted . Factors Impacting Comparability of Interim Financial Statements Siemens Health Services On February 2, 2015, we acquired Siemens Health Services, as further described in Note (2). The addition of the Siemens Health Services business has a significant impact on the comparability of our condensed consolidated financial statements as of and for the three and nine months ended October 3, 2015 , in relation to the comparative periods presented herein. Amortization of Acquisition-related Intangibles Amortization of acquisition-related intangibles includes the amortization of customer relationships, acquired technology, trade names, and non-compete agreements recorded in connection with our business acquisitions. Historically, such amounts were included in general and administrative expense in our condensed consolidated statements of operations. Effective for our second quarter of 2015, amortization of acquisition-related intangibles is presented on a separate line within our condensed consolidated statements of operations. While this reporting change did not impact our consolidated results, prior period reclassifications have been made to conform to the current period presentation. Acquisition Transactions within our Condensed Consolidated Statements of Cash Flows Historically, the fair value of tangible assets acquired and liabilities assumed in business acquisitions were presented on a net basis within our condensed consolidated statements of cash flows. Effective for our first quarter of 2015, the fair value of tangible assets acquired and the fair value of liabilities assumed are presented separately. While this reporting change did not impact our consolidated results, prior period reclassifications have been made to conform to the current period presentation. Voluntary Separation Plan In the first quarter of 2015, the Company adopted a voluntary separation plan ("VSP") for eligible associates. Generally, the VSP was available to U.S. associates who met a minimum level of combined age and tenure, excluding, among others, our executive officers. Associates who elected to participate in the VSP receive financial benefits commensurate with their tenure and position, along with vacation payout and medical benefits. We account for voluntary separation benefits in accordance with the provisions of Accounting Standards Codification (ASC) Topic 712, Compensation-Nonretirement Postemployment Benefits. Voluntary separation benefits are recorded to expense when the associates irrevocably accept the offer and the amount of the termination liability is reasonably estimable. The irrevocable acceptance period for most associates electing to participate in the VSP ended in May 2015. During the nine months ended October 3, 2015 , we recorded pre-tax charges for the VSP of $45 million , which is included in general and administrative expense in our condensed consolidated statements of operations. We expect to record additional pre-tax charges of approximately $1 million for the VSP in the remainder of 2015. Recently Issued Accounting Pronouncements Revenue Recognition. In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP. The new standard is effective for the Company in the first quarter of 2018, with early adoption permitted in the first quarter of 2017. The standard permits the use of either the retrospective or cumulative effect transition method. At this time, we have not selected a transition method, nor have we determined if we will adopt early. We are currently evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. Debt Issuance Costs. In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs be presented in the balance sheet as a direct deduction from the carrying value of the debt liability. ASU 2015-03 is effective for the Company in the first quarter of 2016, with early adoption permitted, and retrospective application required. The Company has chosen to adopt the standard early, effective in the first quarter of 2015. The adoption of ASU 2015-03 did not have a material impact on our condensed consolidated financial statements. Refer to Note (9) for further information regarding debt issuance costs. Consolidation. In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis, which provides guidance when evaluating whether to consolidate certain legal entities. The updated guidance modifies evaluation criteria of limited partnerships and similar legal entities, eliminates the presumption that a general partner should consolidate a limited partnership, and affects the consolidation analysis of reporting entities that are involved with variable interest entities, particularly those that have fee arrangements and related party relationships. ASU 2015-02 is effective for the Company in the first quarter of 2016, with early adoption permitted. We are currently evaluating the effect that ASU 2015-02 will have on our consolidated financial statements and related disclosures. Measurement-Period Adjustments. In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments, which eliminates the requirement to retrospectively adjust the financial statements for measurement-period adjustments that occur in periods after a business combination is consummated. An acquirer now must recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. ASU 2015-16 is effective for the Company in the first quarter of 2016, with early adoption permitted. The Company has chosen to adopt the standard early, effective in the third quarter of 2015. The adoption of ASU 2015-16 did not have a material impact on our condensed consolidated financial statements. |
Acquisitions Pro Formas (Tables
Acquisitions Pro Formas (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Business Combinations [Abstract] | |
Business Acquisition, Pro Forma Information [Table Text Block] | The following table provides unaudited pro forma results of operations for the three and nine months ended October 3, 2015 and September 27, 2014 , as if the acquisition had been completed on the first day of our 2014 fiscal year. Three Months Ended Nine Months Ended (In thousands, except per share data) 2015 2014 2015 2014 Pro forma revenues $ 1,127,887 $ 1,131,290 $ 3,343,653 $ 3,341,952 Pro forma net earnings 147,680 113,804 379,059 326,936 Pro forma diluted earnings per share 0.42 0.33 1.08 0.93 |
Acquisitions Schedule of Goodwi
Acquisitions Schedule of Goodwill (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Business Combinations [Abstract] | |
Schedule of Goodwill [Table Text Block] | The changes in the carrying amounts of goodwill for the nine months ended October 3, 2015 were as follows: (In thousands) Domestic Global Total Beginning balance $ 311,170 $ 9,368 $ 320,538 Goodwill recorded in connection with the Siemens Health Services acquisition 410,149 62,327 472,476 Foreign currency translation adjustments and other — (4,071 ) (4,071 ) Ending balance at October 3, 2015 $ 721,319 $ 67,624 $ 788,943 |
Acquisitions Schedule of Recogn
Acquisitions Schedule of Recognized Identified Assets Acquired and Liabilities Assumed (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Business Combinations [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | The preliminary allocation of purchase price is as follows: (in thousands) Allocation Amount Estimated Weighted Average Useful Life Receivables, net of allowances of $33,674 $ 235,284 Other current assets 56,859 Property and equipment 158,288 20 years Goodwill 472,476 Intangible assets: Customer relationships 396,000 10 years Existing technologies 201,990 5 years Trade names 39,990 8 years Total intangible assets 637,980 Other non-current assets 231 Accounts payable (42,513 ) Deferred revenue (current) (90,148 ) Other current liabilities (20,398 ) Deferred revenue (non-current) (14,930 ) Total purchase price $ 1,393,129 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table details our financial assets measured and recorded at fair value on a recurring basis at October 3, 2015 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 33,888 $ — $ — Time deposits Cash equivalents — 4,590 — Government and corporate bonds Cash equivalents — 200 — Time deposits Short-term investments — 50,062 — Commercial paper Short-term investments — 2,500 — Government and corporate bonds Short-term investments — 150,218 — Government and corporate bonds Long-term investments — 284,972 — The following table details our financial assets measured and recorded at fair value on a recurring basis at January 3, 2015 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 189,137 $ — $ — Time deposits Cash equivalents — 9,989 — Commercial paper Cash equivalents — 115,638 — Time deposits Short-term investments — 52,829 — Commercial paper Short-term investments — 435,544 — Government and corporate bonds Short-term investments — 297,290 — Government and corporate bonds Long-term investments — 218,965 — |
Investments Investments (Tables
Investments Investments (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Investments [Abstract] | |
Schedule of available-for-sale investments | Available-for-sale investments at October 3, 2015 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 33,888 $ — $ — $ 33,888 Time deposits 4,590 — — 4,590 Government and corporate bonds 200 — — 200 Total cash equivalents 38,678 — — 38,678 Short-term investments: Time deposits 50,062 — — 50,062 Commercial paper 2,500 — — 2,500 Government and corporate bonds 150,184 75 (41 ) 150,218 Total short-term investments 202,746 75 (41 ) 202,780 Long-term investments: Government and corporate bonds 285,034 199 (261 ) 284,972 Total available-for-sale investments $ 526,458 $ 274 $ (302 ) $ 526,430 Available-for-sale investments at January 3, 2015 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 189,137 $ — $ — $ 189,137 Time deposits 9,989 — — 9,989 Commercial paper 115,638 — — 115,638 Total cash equivalents 314,764 — — 314,764 Short-term investments: Time deposits 52,830 — (1 ) 52,829 Commercial paper 435,555 1 (12 ) 435,544 Government and corporate bonds 297,311 69 (90 ) 297,290 Total short-term investments 785,696 70 (103 ) 785,663 Long-term investments: Government and corporate bonds 219,439 26 (500 ) 218,965 Total available-for-sale investments $ 1,319,899 $ 96 $ (603 ) $ 1,319,392 |
Receivables (Tables)
Receivables (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Receivables [Abstract] | |
Summary of Net Receivables | A summary of net receivables is as follows: (In thousands) October 3, 2015 January 3, 2015 Gross accounts receivable $ 1,062,253 $ 641,160 Less: Allowance for doubtful accounts 50,107 25,531 Accounts receivable, net of allowance 1,012,146 615,629 Current portion of lease receivables 40,988 57,149 Total receivables, net $ 1,053,134 $ 672,778 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Earnings Per Share [Abstract] | |
Reconciliation Of The Numerators And The Denominators Of The Basic And Diluted Per Share | Nine Months Ended 2015 2014 Earnings Shares Per-Share Earnings Shares Per-Share (In thousands, except per share data) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic earnings per share: Income available to common shareholders $ 373,254 343,933 $ 1.09 $ 377,561 342,254 $ 1.10 Effect of dilutive securities: Stock options and non-vested shares — 7,958 — 8,214 Diluted earnings per share: Income available to common shareholders including assumed conversions $ 373,254 351,891 $ 1.06 $ 377,561 350,468 $ 1.08 A reconciliation of the numerators and the denominators of the basic and diluted per share computations are as follows: Three Months Ended 2015 2014 Earnings Shares Per-Share Earnings Shares Per-Share (In thousands, except per share data) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic earnings per share: Income available to common shareholders $ 147,282 344,040 $ 0.43 $ 129,002 341,188 $ 0.38 Effect of dilutive securities: Stock options and non-vested shares — 7,324 — 8,138 Diluted earnings per share: Income available to common shareholders including assumed conversions $ 147,282 351,364 $ 0.42 $ 129,002 349,326 $ 0.37 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule Of Stock Options Activity | Options activity for the nine months ended October 3, 2015 was as follows: (In thousands, except per share data) Number of Shares Weighted- Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Term (Yrs) Outstanding at beginning of year 24,629 $ 27.00 Granted 3,169 68.21 Exercised (3,345 ) 15.24 Forfeited and expired (262 ) 47.57 Outstanding as of October 3, 2015 24,191 33.81 $ 687,701 6.11 Exercisable as of October 3, 2015 13,813 $ 19.30 $ 580,713 4.51 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The weighted-average assumptions used to estimate the fair value, under the Black-Scholes-Merton pricing model, of stock options granted during the nine months ended October 3, 2015 were as follows: Expected volatility (%) 27.4 % Expected term (yrs) 7 Risk-free rate (%) 1.8 % Fair value per option $ 21.85 |
Schedule of Share-based Compensation, Restricted Stock Activity | Non-vested share activity for the nine months ended October 3, 2015 was as follows: (In thousands, except per share data) Number of Shares Weighted-Average Grant Date Fair Value Outstanding at beginning of year 506 $ 46.21 Granted 293 69.21 Vested (184 ) 44.91 Forfeited (57 ) 43.37 Outstanding as of October 3, 2015 558 $ 59.07 |
Compensation Expense Recognized In The Condensed Consolidated Statements Of Operations | The following table presents total compensation expense recognized with respect to stock options, non-vested shares and our associate stock purchase plan: Three Months Ended Nine Months Ended (In thousands) 2015 2014 2015 2014 Stock option and non-vested share compensation expense $ 18,875 $ 15,061 $ 53,326 $ 43,330 Associate stock purchase plan expense 1,485 1,109 4,238 3,486 Amounts capitalized in software development costs, net of amortization (183 ) (171 ) (483 ) (845 ) Amounts charged against earnings, before income tax benefit $ 20,177 $ 15,999 $ 57,081 $ 45,971 Amount of related income tax benefit recognized in earnings $ 6,398 $ 5,616 $ 18,595 $ 16,136 |
Indebtedness (Tables)
Indebtedness (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of Debt [Table Text Block] | The following is a summary of indebtedness outstanding: (In thousands) October 3, 2015 January 3, 2015 Note agreement, 5.54% $ 14,095 $ 14,233 Senior Notes 500,000 — Capital lease obligations 104,018 116,095 Other 13,297 — Debt and capital lease obligations 631,410 130,328 Less: debt issuance costs (741 ) — Debt and capital lease obligations, net 630,669 130,328 Less: current portion (57,841 ) (67,460 ) Long-term debt and capital lease obligations $ 572,828 $ 62,868 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 9 Months Ended |
Oct. 03, 2015 | |
Segment Reporting [Abstract] | |
Summary of the Operating Information | The following table presents a summary of our operating segments and other expense for the three and nine months ended October 3, 2015 and September 27, 2014 : (In thousands) Domestic Global Other Total Three Months Ended 2015 Revenues $ 997,954 $ 129,933 $ — $ 1,127,887 Cost of revenues 169,181 21,402 — 190,583 Operating expenses 403,371 60,448 258,131 721,950 Total costs and expenses 572,552 81,850 258,131 912,533 Operating earnings (loss) $ 425,402 $ 48,083 $ (258,131 ) $ 215,354 (In thousands) Domestic Global Other Total Three Months Ended 2014 Revenues $ 741,830 $ 98,319 $ — $ 840,149 Cost of revenues 126,223 13,842 — 140,065 Operating expenses 290,799 43,556 177,575 511,930 Total costs and expenses 417,022 57,398 177,575 651,995 Operating earnings (loss) $ 324,808 $ 40,921 $ (177,575 ) $ 188,154 (In thousands) Domestic Global Other Total Nine Months Ended 2015 Revenues $ 2,863,207 $ 386,766 $ — $ 3,249,973 Cost of revenues 480,087 71,478 — 551,565 Operating expenses 1,157,762 170,846 815,798 2,144,406 Total costs and expenses 1,637,849 242,324 815,798 2,695,971 Operating earnings (loss) $ 1,225,358 $ 144,442 $ (815,798 ) $ 554,002 (In thousands) Domestic Global Other Total Nine Months Ended 2014 Revenues $ 2,206,297 $ 270,375 $ — $ 2,476,672 Cost of revenues 389,344 42,189 — 431,533 Operating expenses 848,398 136,474 502,477 1,487,349 Total costs and expenses 1,237,742 178,663 502,477 1,918,882 Operating earnings (loss) $ 968,555 $ 91,712 $ (502,477 ) $ 557,790 |
Interim Statement Presentatio30
Interim Statement Presentation Interim Statement Presentation (Details) $ in Millions | 9 Months Ended |
Oct. 03, 2015USD ($) | |
Interim Statement Presentation [Abstract] | |
Description of Postemployment Benefits | Associates who elected to participate in the VSP receive financial benefits commensurate with their tenure and position, along with vacation payout and medical benefits. |
Postemployment Benefits, Period Expense | $ 45 |
Estimated Severance Benefits | $ 1 |
Acquired Intangible Amortization [Member] | |
Interim Statement Presentation [Line Items] | |
Reclassifications [Text Block] | Amortization of acquisition-related intangibles includes the amortization of customer relationships, acquired technology, trade names, and non-compete agreements recorded in connection with our business acquisitions. Historically, such amounts were included in general and administrative expense in our condensed consolidated statements of operations. Effective for our second quarter of 2015, amortization of acquisition-related intangibles is presented on a separate line within our condensed consolidated statements of operations. While this reporting change did not impact our consolidated results, prior period reclassifications have been made to conform to the current period presentation. |
Summary of acquisition transactions [Member] | |
Interim Statement Presentation [Line Items] | |
Reclassifications [Text Block] | Historically, the fair value of tangible assets acquired and liabilities assumed in business acquisitions were presented on a net basis within our condensed consolidated statements of cash flows. Effective for our first quarter of 2015, the fair value of tangible assets acquired and the fair value of liabilities assumed are presented separately. While this reporting change did not impact our consolidated results, prior period reclassifications have been made to conform to the current period presentation. |
Interim Statement Presentatio31
Interim Statement Presentation Policies (Details) | 9 Months Ended |
Oct. 03, 2015 | |
Accounting Policies [Abstract] | |
Postemployment Benefit Plans, Policy [Policy Text Block] | We account for voluntary separation benefits in accordance with the provisions of Accounting Standards Codification (ASC) Topic 712, Compensation-Nonretirement Postemployment Benefits. Voluntary separation benefits are recorded to expense when the associates irrevocably accept the offer and the amount of the termination liability is reasonably estimable. |
Fiscal Period, Policy [Policy Text Block] | Our third fiscal quarter ends on the Saturday closest to September 30. The 2015 and 2014 third quarters ended on October 3, 2015 and September 27, 2014, respectively. All references to years in these notes to condensed consolidated financial statements represent the respective three or nine months ended on such dates, unless otherwise noted |
ASU 2014-09 Revenue from Contracts with Customers [Member] | |
Interim Statement Presentation [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP. The new standard is effective for the Company in the first quarter of 2018, with early adoption permitted in the first quarter of 2017. The standard permits the use of either the retrospective or cumulative effect transition method. At this time, we have not selected a transition method, nor have we determined if we will adopt early. We are currently evaluating the effect that ASU 2014-09 will have on our consolidated financial statements and related disclosures. |
ASU 2015-03 Interest - Imputation of Interest [Member] | |
Interim Statement Presentation [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In April 2015, the FASB issued ASU 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs, which requires that debt issuance costs be presented in the balance sheet as a direct deduction from the carrying value of the debt liability. ASU 2015-03 is effective for the Company in the first quarter of 2016, with early adoption permitted, and retrospective application required. The Company has chosen to adopt the standard early, effective in the first quarter of 2015. The adoption of ASU 2015-03 did not have a material impact on our condensed consolidated financial statements. Refer to Note (9) for further information regarding debt issuance costs. |
ASU 2015-02 Consolidation (Topic 810) [Member] | |
Interim Statement Presentation [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In February 2015, the FASB issued ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis, which provides guidance when evaluating whether to consolidate certain legal entities. The updated guidance modifies evaluation criteria of limited partnerships and similar legal entities, eliminates the presumption that a general partner should consolidate a limited partnership, and affects the consolidation analysis of reporting entities that are involved with variable interest entities, particularly those that have fee arrangements and related party relationships. ASU 2015-02 is effective for the Company in the first quarter of 2016, with early adoption permitted. We are currently evaluating the effect that ASU 2015-02 will have on our consolidated financial statements and related disclosures. |
ASU 2015-16 Measurement-Period Adjustments [Member] | |
Interim Statement Presentation [Line Items] | |
New Accounting Pronouncements, Policy [Policy Text Block] | In September 2015, the FASB issued ASU 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments, which eliminates the requirement to retrospectively adjust the financial statements for measurement-period adjustments that occur in periods after a business combination is consummated. An acquirer now must recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. ASU 2015-16 is effective for the Company in the first quarter of 2016, with early adoption permitted. The Company has chosen to adopt the standard early, effective in the third quarter of 2015. The adoption of ASU 2015-16 did not have a material impact on our condensed consolidated financial statements. |
Acquisitions Acquisitions (Deta
Acquisitions Acquisitions (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | Feb. 02, 2015 | Jan. 03, 2015 | |
Business Acquisition [Line Items] | ||||||
Business Combination, Consideration Transferred, Working Capital Settlement | $ 21,000 | |||||
Goodwill | $ 788,943 | 788,943 | $ 320,538 | |||
Goodwill, Acquired During Period | 472,476 | |||||
Goodwill, Translation Adjustments | $ (4,071) | |||||
Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Effective Date of Acquisition | Feb. 2, 2015 | |||||
Business Acquisition, Name of Acquired Entity | Siemens Health Services | |||||
Business Acquisition, Description of Acquired Entity | Siemens Health Services offered a portfolio of enterprise-level clinical and financial health care information technology solutions, as well as departmental, connectivity, population health, and care coordination solutions globally. Solutions were offered on the Soarian®, Invision®, and i.s.h.med® platforms, among others. Siemens Health Services also offered a range of complementary services including support, hosting, managed services, implementation services, and strategic consulting. | |||||
Business Combination, Reason for Business Combination | We believe the acquisition enhances our organic growth opportunities as it provides us a larger base into which we can sell our combined portfolio of solutions and services. The acquisition also augments our non-U.S. footprint and growth opportunities, increases our scale for R&D investment, and adds over 5,000 highly-skilled associates that will enhance our capabilities. | |||||
Business Combination, Goodwill Recognized, Description | These factors, combined with the synergies and economies of scale expected from combining the operations of Cerner and Siemens Health Services, are the basis for the acquisition and comprise the resulting goodwill recorded. | |||||
Business Combination, Consideration Transferred | $ 1,390,000 | |||||
Business Acquisition, Date of Acquisition Agreement | Aug. 5, 2014 | |||||
Business Acquisition, Transaction Costs | 20,000 | $ 20,000 | ||||
Business Combination, Provisional Information, Initial Accounting Incomplete, Reasons | The allocation of purchase price is preliminary and subject to changes, which could be significant, as appraisals of tangible and intangible assets are finalized, and additional information becomes available. | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Receivables | $ 235,284 | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Assets, Other | 56,859 | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | 158,288 | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, PP&E, Weighted Average Useful Life | 20 years | |||||
Goodwill | 472,476 | |||||
Intangible assets | 637,980 | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 231 | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Accounts Payable | (42,513) | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Deferred Revenue | (90,148) | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Current Liabilities, Other | (20,398) | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Noncurrent Liabilities, Deferred Revenue | (14,930) | |||||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Net | 1,393,129 | |||||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 250,000 | $ 685,000 | ||||
Business Combination, Pro Forma Information, Disclosure Impracticable | Disclosure of the earnings contribution from the Cerner Health Services business is not practicable, as we have already integrated operations in many areas. | |||||
Business Acquisition, Pro Forma Revenue | 1,127,887 | $ 1,131,290 | $ 3,343,653 | $ 3,341,952 | ||
Business Acquisition, Pro Forma Net Income (Loss) | $ 147,680 | $ 113,804 | $ 379,059 | $ 326,936 | ||
Business Acquisition, Pro Forma Earnings Per Share, Diluted | $ 0.42 | $ 0.33 | $ 1.08 | $ 0.93 | ||
Business Acquisition, Pro Forma Information, Description | These pro forma results are based on estimates and assumptions, which we believe are reasonable. They are not the results that would have been realized had we been a combined company during the periods presented, nor are they indicative of our consolidated results of operations in future periods. | |||||
Business Acquisition, Goodwill, Expected Tax Deductible Amount | 472,476 | |||||
Business Combination, Acquired Receivables, Estimated Uncollectible | 33,674 | |||||
Customer Relationships [Member] | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets | 396,000 | |||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 10 years | |||||
Developed Technology Rights [Member] | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets | 201,990 | |||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years | |||||
Trade Names [Member] | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets | $ 39,990 | |||||
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 8 years | |||||
Domestic Segment | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 721,319 | $ 721,319 | 311,170 | |||
Goodwill, Acquired During Period | 410,149 | |||||
Goodwill, Translation Adjustments | 0 | |||||
Global Segment | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | 67,624 | 67,624 | $ 9,368 | |||
Goodwill, Acquired During Period | 62,327 | |||||
Goodwill, Translation Adjustments | (4,071) | |||||
Acquired Intangible Amortization [Member] | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Pro Forma Net Income (Loss) | $ 22,000 | 7,000 | $ 65,000 | |||
Fair Value Adjustment to Deferred Revenue [Member] | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Pro Forma Net Income (Loss) | $ 9,000 | 6,000 | $ 34,000 | |||
Acquisition-related Costs [Member] | Siemens Health Services [Member] | ||||||
Business Acquisition [Line Items] | ||||||
Business Acquisition, Pro Forma Net Income (Loss) | $ 1,000 | $ 20,000 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions | Oct. 03, 2015 | Jan. 03, 2015 |
Fair Value Disclosures [Abstract] | ||
Fair value of long-term debt, including current maturities | $ 523 | $ 15 |
Carrying amount of long-term debt | $ 514 | $ 14 |
Fair Value Measurements Fair Va
Fair Value Measurements Fair Value, Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Oct. 03, 2015 | Jan. 03, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | $ 526,430 | $ 1,319,392 |
Level 1 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 33,888 | 189,137 |
Level 2 [Member] | Time deposits [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 4,590 | 9,989 |
Level 2 [Member] | Commercial paper [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 115,638 | |
Level 2 [Member] | Government and corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 200 | |
Short-term investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 202,780 | 785,663 |
Short-term investments [Member] | Level 2 [Member] | Time deposits [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 50,062 | 52,829 |
Short-term investments [Member] | Level 2 [Member] | Commercial paper [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 2,500 | 435,544 |
Short-term investments [Member] | Level 2 [Member] | Government and corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 150,218 | 297,290 |
Long-term investments [Member] | Level 2 [Member] | Government and corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | $ 284,972 | $ 218,965 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Oct. 03, 2015 | Sep. 27, 2014 | |
Investments [Abstract] | ||
Proceeds from Sale of Available-for-sale Securities | $ 157 | $ 660 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | Oct. 03, 2015 | Jan. 03, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | $ 526,458 | $ 1,319,899 |
Gross Unrealized Gains | 274 | 96 |
Gross Unrealized Losses | (302) | (603) |
Fair Value | 526,430 | 1,319,392 |
Cash equivalents [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 38,678 | 314,764 |
Fair Value | 38,678 | 314,764 |
Cash equivalents [Member] | Money market funds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 33,888 | 189,137 |
Fair Value | 33,888 | 189,137 |
Cash equivalents [Member] | Time deposits [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 4,590 | 9,989 |
Fair Value | 4,590 | 9,989 |
Cash equivalents [Member] | Commercial paper [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 115,638 | |
Fair Value | 115,638 | |
Cash equivalents [Member] | Government and corporate bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 200 | |
Fair Value | 200 | |
Short-term investments [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 202,746 | 785,696 |
Gross Unrealized Gains | 75 | 70 |
Gross Unrealized Losses | (41) | (103) |
Fair Value | 202,780 | 785,663 |
Short-term investments [Member] | Time deposits [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 50,062 | 52,830 |
Gross Unrealized Losses | (1) | |
Fair Value | 50,062 | 52,829 |
Short-term investments [Member] | Commercial paper [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 2,500 | 435,555 |
Gross Unrealized Gains | 1 | |
Gross Unrealized Losses | (12) | |
Fair Value | 2,500 | 435,544 |
Short-term investments [Member] | Government and corporate bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 150,184 | 297,311 |
Gross Unrealized Gains | 75 | 69 |
Gross Unrealized Losses | (41) | (90) |
Fair Value | 150,218 | 297,290 |
Long-term investments [Member] | Government and corporate bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 285,034 | 219,439 |
Gross Unrealized Gains | 199 | 26 |
Gross Unrealized Losses | (261) | (500) |
Fair Value | $ 284,972 | $ 218,965 |
Receivables (Narrative) (Detail
Receivables (Narrative) (Details) - USD ($) $ in Billions | 9 Months Ended | |
Oct. 03, 2015 | Sep. 27, 2014 | |
Receivables [Abstract] | ||
Client cash collections | $ 3.2 | $ 2.6 |
Receivables (Summary Of Net Rec
Receivables (Summary Of Net Receivables) (Details) - USD ($) $ in Thousands | Oct. 03, 2015 | Jan. 03, 2015 |
Receivables [Abstract] | ||
Gross accounts receivable | $ 1,062,253 | $ 641,160 |
Less: Allowance for doubtful accounts | 50,107 | 25,531 |
Accounts receivable, net of allowance | 1,012,146 | 615,629 |
Current portion of lease receivables | 40,988 | 57,149 |
Total receivables, net | $ 1,053,134 | $ 672,778 |
Income Taxes (Details)
Income Taxes (Details) | 9 Months Ended | |
Oct. 03, 2015 | Sep. 27, 2014 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 32.60% | 33.30% |
Earnings Per Share (Reconciliat
Earnings Per Share (Reconciliation Of The Numerators And The Denominators Of The Basic And Diluted Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Earnings Per Share [Abstract] | ||||
Income available to common shareholders, basic | $ 147,282 | $ 129,002 | $ 373,254 | $ 377,561 |
Income available to common shareholders including assumed conversions, diluted | $ 147,282 | $ 129,002 | $ 373,254 | $ 377,561 |
Basic weighted average shares outstanding | 344,040 | 341,188 | 343,933 | 342,254 |
Stock options and non-vested shares, incremental shares | 7,324 | 8,138 | 7,958 | 8,214 |
Diluted weighted average shares outstanding | 351,364 | 349,326 | 351,891 | 350,468 |
Basic earnings per share | $ 0.43 | $ 0.38 | $ 1.09 | $ 1.10 |
Diluted earnings per share | $ 0.42 | $ 0.37 | $ 1.06 | $ 1.08 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - $ / shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of earnings per share, amount | 3.9 | 6.7 | 2.5 | 5.4 |
Antidilutive securities excluded from computation of earnings per share, exercise price, lower range limit | $ 48.39 | $ 38.66 | $ 51.97 | $ 38.66 |
Antidilutive securities excluded from computation of earnings per share, exercise price, upper range limit | $ 73.40 | $ 60.37 | $ 73.40 | $ 60.37 |
Share-Based Compensation (Sched
Share-Based Compensation (Schedule Of Stock Options Activity) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 9 Months Ended |
Oct. 03, 2015USD ($)$ / sharesshares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Outstanding at beginning of year, number of shares | shares | 24,629 |
Outstanding at beginning of year, weighted-average exercise price | $ 27 |
Granted, number of shares | shares | 3,169 |
Granted, weighted-average exercise price | $ 68.21 |
Exercised, number of shares | shares | (3,345) |
Exercised, weighted-average exercise price | $ 15.24 |
Forfeited and expired, number of shares | shares | (262) |
Forfeited and expired, weighted-average exercise price | $ 47.57 |
Outstanding end of year, number of shares | shares | 24,191 |
Outstanding at end of year, weighted-average exercise price | $ 33.81 |
Outstanding at end of year, aggregate intrinsic value | $ | $ 687,701 |
Outstanding at end of year, weighted-average remaining contractual term | 6 years 1 month 10 days |
Exercisable at end of year, number of shares | shares | 13,813 |
Exercisable at end of year, weighted-average exercise price | $ 19.30 |
Exercisable at end of year, aggregate intrinsic value | $ | $ 580,713 |
Exercisable at end of year, weighted-average remaining contractual term | 4 years 6 months 5 days |
Share-Based Compensation (Sch43
Share-Based Compensation (Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions) (Details) | 9 Months Ended |
Oct. 03, 2015$ / shares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Expected volatility (%) | 27.40% |
Expected term (yrs) | 7 years |
Risk-free rate (%) | 1.80% |
Fair value per option | $ 21.85 |
Share-Based Compensation (Sch44
Share-Based Compensation (Schedule Of Non-Vested Shares Activity) (Details) - Restricted Stock [Member] shares in Thousands | 9 Months Ended |
Oct. 03, 2015$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at beginning of year, number of shares | shares | 506 |
Outstanding at beginning of year, weighted-average grant date fair value | $ 46.21 |
Granted, number of shares | shares | 293 |
Granted, weighted-average grant date fair value | $ 69.21 |
Vested, number of shares | shares | (184) |
Vested, weighted-average grant date fair value | $ 44.91 |
Forfeited, number of shares | shares | (57) |
Forfeited, weighted-average grant date fair value | $ 43.37 |
Outstanding at end of year, number of shares | shares | 558 |
Outstanding at end of year, weighted-average grant date fair value | $ 59.07 |
Share-Based Compensation (Compe
Share-Based Compensation (Compensation Expense Recognized In The Condensed Consolidated Statements Of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Amounts charged against earnings, before income tax benefit | $ 20,177 | $ 15,999 | $ 57,081 | $ 45,971 |
Amount of related income tax benefit recognized in earnings | 6,398 | 5,616 | 18,595 | 16,136 |
Stock option and non-vested share compensation expense | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Amounts charged against earnings, before income tax benefit | 18,875 | 15,061 | 53,326 | 43,330 |
Associate stock purchase plan expense | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Amounts charged against earnings, before income tax benefit | 1,485 | 1,109 | 4,238 | 3,486 |
Amounts capitalized in software development costs, net of amortization | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Amounts charged against earnings, before income tax benefit | $ (183) | $ (171) | $ (483) | $ (845) |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) shares in Millions, $ in Millions | 9 Months Ended |
Oct. 03, 2015USD ($)shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Share-based Awards Other than Options | $ 19 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Stock Options | $ 158 |
Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Period of recognition for remaining share-based compensation expense | 3 years 4 months 20 days |
Restricted Stock [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Period of recognition for remaining share-based compensation expense | 1 year 9 months 8 days |
2013 Repurchase Program [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock Repurchase Program, Authorized Amount | $ 317 |
Stock Repurchased During Period, Shares | shares | 1.6 |
Payments for Repurchase of Common Stock | 100 |
2015 Repurchase Program [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Stock Repurchase Program, Authorized Amount | $ 245 |
Stock Repurchased During Period, Shares | shares | 1.6 |
Payments for Repurchase of Common Stock | 100 |
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 145 |
Indebtedness (Details)
Indebtedness (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Oct. 03, 2015 | Jan. 29, 2015 | Jan. 03, 2015 | |
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 631,410 | $ 130,328 | |
Deferred Finance Costs, Noncurrent, Net | (741) | 0 | |
Long-term Debt and Capital Lease Obligations, Net of Debt Issuance Costs | 630,669 | 130,328 | |
Long-term Debt and Capital Lease Obligations, Current | (57,841) | (67,460) | |
Long-term Debt and Capital Lease Obligations | 572,828 | 62,868 | |
Line of Credit Facility, Maximum Borrowing Capacity | $ 100,000 | ||
Line of Credit Facility, Expiration Date | Oct. 29, 2020 | ||
Line of Credit Facility, Ability to Increase Borrowing Capacity, Maximum Amount | $ 200,000 | ||
Line of Credit Facility, Interest Rate Description | Interest is payable at a rate based on prime, LIBOR, or the U.S. federal funds rate, plus a spread that varies depending on the leverage ratios maintained. | ||
Line of Credit Facility, Covenant Terms | The agreement provides certain restrictions on our ability to borrow, incur liens, sell assets and pay dividends and contains certain cash flow and debt covenants. | ||
Letters of Credit Outstanding, Amount | $ 16,000 | ||
Note Agreement, 5.54% [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | 14,095 | 14,233 | |
Senior Notes [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 500,000 | 0 | |
Debt Instrument, Face Amount | $ 500,000 | ||
Debt Instrument, Restrictive Covenants | The Master Note Purchase Agreement contains certain leverage and interest coverage ratio covenants and provides certain restrictions on our ability to borrow, incur liens, sell assets, and other customary terms. | ||
Series 2015-A [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Face Amount | $ 225,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 3.18% | ||
Debt Instrument, Maturity Date | Feb. 15, 2022 | ||
Debt Instrument, Frequency of Periodic Payment | payable semiannually | ||
Debt Instrument, Date of First Required Payment | Aug. 15, 2015 | ||
Series 2015-B [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Face Amount | $ 200,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 3.58% | ||
Debt Instrument, Maturity Date | Feb. 14, 2025 | ||
Series 2015-C [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Face Amount | $ 75,000 | ||
Debt Instrument, Maturity Date | Feb. 15, 2022 | ||
Debt Instrument, Frequency of Periodic Payment | payable quarterly | ||
Debt Instrument, Date of First Required Payment | May 15, 2015 | ||
Series 2015-C [Member] | London Interbank Offered Rate (LIBOR) [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Description of Variable Rate Basis | Adjusted LIBOR Rate | ||
Debt Instrument, Interest Rate During Period | 1.32% | ||
Capital Lease Obligations [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 104,018 | 116,095 | |
Other [Member] | |||
Debt Instrument [Line Items] | |||
Debt and Capital Lease Obligations | $ 13,297 | $ 0 |
Segment Reporting (Summary Of T
Segment Reporting (Summary Of The Operating Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Oct. 03, 2015 | Sep. 27, 2014 | Oct. 03, 2015 | Sep. 27, 2014 | |
Segment Reporting Information [Line Items] | ||||
Description of Effect on Previously Reported Segment Information for Change in Composition of Reportable Segments | In connection with our acquisition of the Cerner Health Services business, we commenced an evaluation of our methodology for allocating operating expenses to our reportable segments. Effective for our first quarter of 2015, certain expenses historically reported in “Other” have been allocated to the geographic segments. This new allocation reflects the manner in which the business is now managed, subsequent to the acquisition. While this reporting change did not impact our consolidated results, the segment data has been recast to be consistent for all periods presented. | |||
Revenue | $ 1,127,887 | $ 840,149 | $ 3,249,973 | $ 2,476,672 |
Cost of revenues | 190,583 | 140,065 | 551,565 | 431,533 |
Operating expenses | 721,950 | 511,930 | 2,144,406 | 1,487,349 |
Total costs and expenses | 912,533 | 651,995 | 2,695,971 | 1,918,882 |
Operating earnings (loss) | 215,354 | 188,154 | 554,002 | 557,790 |
Domestic Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 997,954 | 741,830 | 2,863,207 | 2,206,297 |
Cost of revenues | 169,181 | 126,223 | 480,087 | 389,344 |
Operating expenses | 403,371 | 290,799 | 1,157,762 | 848,398 |
Total costs and expenses | 572,552 | 417,022 | 1,637,849 | 1,237,742 |
Operating earnings (loss) | 425,402 | 324,808 | 1,225,358 | 968,555 |
Global Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 129,933 | 98,319 | 386,766 | 270,375 |
Cost of revenues | 21,402 | 13,842 | 71,478 | 42,189 |
Operating expenses | 60,448 | 43,556 | 170,846 | 136,474 |
Total costs and expenses | 81,850 | 57,398 | 242,324 | 178,663 |
Operating earnings (loss) | 48,083 | 40,921 | 144,442 | 91,712 |
Other | ||||
Segment Reporting Information [Line Items] | ||||
Operating expenses | 258,131 | 177,575 | 815,798 | 502,477 |
Total costs and expenses | 258,131 | 177,575 | 815,798 | 502,477 |
Operating earnings (loss) | $ (258,131) | $ (177,575) | $ (815,798) | $ (502,477) |