EX-99.1 2 d250485dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

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11695 Johns Creek Pkwy.

Johns Creek, GA 30097

 

   NEWS RELEASE
For media information:    For investor information:
Mike O’Sullivan    Gregg Swearingen
(937) 242-4786    (937) 242-4600
mike.osullivan@teradata.com    gregg.swearingen@teradata.com
For Release on November 3, 2011   

Teradata Announces 2011 Third Quarter Results

 

   

Revenue increased 23 percent from the third quarter of 2010

 

   

GAAP EPS was $0.51, versus $0.44 in the prior-year period

 

   

Non-GAAP EPS increased 28 percent to $0.59, versus $0.46 in the third quarter of 2010(2)

 

   

Cash from Operations increased 57 percent from the third quarter of 2010

 

   

Increasing revenue and EPS guidance for 2011

ATLANTA Teradata Corporation (NYSE: TDC) reported revenue of $602 million for the quarter ended September 30, 2011, an increase of 23 percent from $489 million in the third quarter of 2010. The year-over-year comparison was benefited by approximately 4 percentage points from currency translation. (1)

Special items were included in Teradata’s results reported under U.S. Generally Accepted Accounting Principles (GAAP) for the third quarter of 2011, including $6 million of amortization of acquisition-related intangible assets; $4 million of transaction, integration and reorganization costs; $3 million of acquisition-related purchase accounting adjustments; and $8 million of stock-based compensation expense. Included in the prior year quarter’s results was $7 million of stock-based compensation expense.

Gross margin in the third quarter was 54.5 percent compared to 57.1 percent in the third quarter of 2010. Excluding the special items mentioned above, gross margin was 55.4 percent in the third quarter of 2011, compared to 57.3 percent in the third quarter of 2010.(2) The decrease in non-GAAP gross margin from the strong prior-year period resulted from a significant increase in our third quarter 2010 consulting services revenue which generates lower gross margin than product revenue. Product gross margin was also lower than the record high product gross margin generated in the third quarter of 2010, which more than offset improved services gross margin in the third quarter of 2011.

Net income reported for the third quarter of 2011 was $87 million, or $0.51 per diluted share, which compared to net income of $75 million, or $0.44 per diluted share, in


the third quarter of 2010. Excluding the special items, non-GAAP EPS was $0.59 in the third quarter of 2011, versus $0.46 in the third quarter of 2010. (2) 

“We continued to deliver strong operating results in the third quarter, growing revenue 23 percent and earnings per share 28 percent. Based on this performance, we are raising our full-year guidance for both revenue and earnings per share,” said Mike Koehler, president and chief executive officer of Teradata Corporation.

“Teradata’s industry-leading data warehousing, big data analytics, and integrated marketing management solutions are in demand as companies look to cost effectively manage the data explosion and extract new insights from both traditional and new types of data.

“As a result of our growth and continued adoption by new and existing customers we are raising our full year 2011 GAAP earnings per share to the $1.98 to $2.03 range and full-year non-GAAP EPS guidance to the $2.25 to $2.30 range.” (2)

Regional Operating Segment Results

Teradata reports its results in three regional operating segments.

Americas

Teradata generated $375 million of revenue in its Americas region in the third quarter of 2011, up 28 percent from $292 million in the third quarter of 2010. Currency translation did not affect revenue growth in the Americas in the third quarter. (1)

Gross margin in the Americas region in the third quarter of 2011 was 59.5 percent, versus the record high 61.6 percent achieved in the third quarter of 2010. The decrease in reported gross margin from the strong prior-year period resulted from lower product gross margin due to deal mix and increased amortization of capitalized software development cost and acquired technology.

Europe, Middle East and Africa (EMEA)

Revenue in Teradata’s EMEA region in the third quarter of 2011 was $133 million, up 22 percent from $109 million generated in the third quarter of 2010. Currency translation benefited the revenue comparison in the EMEA region by 8 percentage points. (1)

Gross margin in the EMEA region in the third quarter of 2011 was 46.6 percent, versus 51.4 percent reported in the third quarter of 2010, primarily due to the greater proportion of consulting revenue as compared to the prior-year period, as well as lower


product gross margin due to deal mix and increased amortization of capitalized software development cost and acquired technology.

Asia Pacific / Japan (APJ)

Teradata generated $94 million of revenue in its APJ region in the third quarter of 2011, a 7 percent increase from $88 million in the third quarter of 2010. The revenue comparison in the APJ region benefited by 9 percentage points from currency translation.(1)

Gross margin in the APJ region in the third quarter of 2011 was 45.7 percent, compared to 48.9 percent in the third quarter of 2010. The gross margin decline was driven primarily by strong growth in consulting revenues which generate lower gross margin, as well as from lower product margins.

Operating Income

Third-quarter operating income of $122 million improved from $106 million reported in the third quarter of 2010. Excluding the items previously mentioned, non-GAAP operating income increased 27 percent to $143 million.(2) In the quarter, higher revenue more than offset increased selling, general and administrative expense and research and development expense, which now include ongoing operating expenses from recent acquisitions. On a non-GAAP basis, operating margin improved to 23.6 percent, versus 23.1 percent in the third quarter of 2010. (2) 

Cash Flow

During the third quarter of 2011, Teradata generated $102 million of cash from operating activities, compared to $65 million in the prior-year period. Capital expenditures in the third quarter totaled $27 million compared to $18 million in the third quarter of 2010. Teradata generated $75 million of free cash flow (cash from operations less capital expenditures for property and equipment and additions to capitalized software) (3) in the third quarter of 2011, a 60 percent increase from $47 million in the same period in 2010.

During the first nine months of 2011, Teradata generated $387 million of cash from operating activities, compared to $265 million in the prior-year period. Capital expenditures in the first nine months of 2011 were $87 million, compared to $62 million in the same period in 2010. During the first nine months of 2011, Teradata generated $300 million of free cash flow, a 48 percent increase from $203 million in the same period in 2010.(3)


     For the Periods Ended September 30  
   (in millions)  
     Three Months     Nine Months  
     2011     2010     2011     2010  

Net Income (GAAP)

   $ 87      $ 75      $ 255      $ 216   

Cash provided by operating activities (GAAP)

   $ 102      $ 65      $ 387      $ 265   

Less capital expenditures for:

        

Expenditures for property and equipment

     (9     (8     (31     (25

Additions to capitalized software

     (18     (10     (56     (37
  

 

 

   

 

 

   

 

 

   

 

 

 

Total capital expenditures

     (27     (18     (87     (62
  

 

 

   

 

 

   

 

 

   

 

 

 

Free Cash Flow (non-GAAP measure) (3)

   $ 75      $ 47      $ 300      $ 203   
  

 

 

   

 

 

   

 

 

   

 

 

 

Balance Sheet

Teradata ended the third quarter of 2011 with $691 million in cash, a $9 million increase from June 30, 2011, as cash generated during the quarter more than offset $57 million of cash Teradata used in the third quarter to repurchase approximately 1.1 million shares of its publicly-traded stock.

As of September 30, 2011, Teradata had total debt of $300 million outstanding under a 5-year term loan. Additionally, Teradata has $300 million of funds available through a pre-arranged credit facility, but had no borrowings related to the credit facility as of September 30, 2011.

2011 Outlook

Teradata is increasing its expectation for full-year 2011 revenue growth to 19-21 percent. Teradata anticipates that currency fluctuations will benefit the year-over-year revenue comparison by approximately 3 percentage points, based on currency rates on October 31, 2011.

Teradata is also increasing its expectation for full-year 2011 GAAP earnings per share to the $1.98 to $2.03 range and full-year non-GAAP EPS guidance to the $2.25 to $2.30 range. (2) Teradata excludes gains from equity investments, estimated purchase accounting adjustments, amortization of acquisition-related intangible assets, stock-based compensation expense, as well as transaction, integration and reorganization costs to arrive at non-GAAP earnings per share.


2011 Third-Quarter Earnings Conference Call

A conference call is scheduled today at 8:30 a.m. (ET) to discuss the company’s third-quarter 2011 results. Access to the conference call, as well as a replay of the call, is available on Teradata’s web site at www.teradata.com/investor.

Supplemental financial information regarding Teradata’s operating results is also available on the Investor Relations page of Teradata’s web site.

About Teradata

Teradata Corporation (NYSE: TDC) is the world’s leading analytic data solutions company focused on integrated data warehousing, big data analytics, and business applications. Teradata’s innovative products and services deliver integration and insight to empower organizations to achieve competitive advantage. Visit teradata.com for details.

# # #

Teradata is a trademark or registered trademark of Teradata Corporation in the United States and other countries.


1. The impact of currency is determined by calculating the prior-period results using the current-year monthly average currency rates. See the foreign currency schedule on the Investor Relations page of the company’s web site www.teradata.com/investor.

 

     For the Periods Ended September 30  
     (in millions)  
     Three Months     Nine Months  
     2011      2010      %
Chg
    %
Chg
CC*
    2011      2010      %
Chg
    %
Chg
CC*
 
Revenue                     

Products (software/hardware)

   $ 287       $ 243         18     16   $ 791       $ 666         19     16

Consulting services

     176         131         34     29     498         380         31     25

Maintenance services

     139         115         21     16     400         342         17     13
  

 

 

    

 

 

        

 

 

    

 

 

      

Total services

     315         246         28     23     898         722         24     19
  

 

 

    

 

 

        

 

 

    

 

 

      

Total revenue

   $ 602       $ 489         23     19   $ 1,689       $ 1,388         22     18
  

 

 

    

 

 

        

 

 

    

 

 

      
     2011      2010      %
Chg
    %
Chg
CC*
    2011      2010      %
Chg
    %
Chg
CC*
 
By segment/region                     

Americas region

   $ 375       $ 292         28     28   $ 1,021       $ 825         24     23

EMEA region

     133         109         22     14     403         323         25     17

APJ region

     94         88         7     -2     265         240         10     1
  

 

 

    

 

 

        

 

 

    

 

 

      

Total revenue

   $ 602       $ 489         23     19   $ 1,689       $ 1,388         22     18
  

 

 

    

 

 

        

 

 

    

 

 

      

 

*

CC = Constant Currency

 

2. Teradata reports its results in accordance with Generally Accepted Accounting Principles in the United States, or GAAP. However, as described below, the company believes that certain non-GAAP measures (such as non-GAAP EPS, non-GAAP operating income and non-GAAP gross margin which exclude certain items as well as free cash flow) are useful for investors. Our non-GAAP measures are not meant to be considered in isolation or as substitutes for or superior to results determined in accordance with GAAP, and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP.

The following tables reconcile Teradata’s actual and projected results and earnings per diluted share, or EPS, under GAAP to the company’s actual and projected non-GAAP results and EPS for the periods presented, which exclude certain items. Our management regularly uses supplemental non-GAAP financial measures, such as EPS, gross margin and operating income, excluding certain items internally, to understand, manage and evaluate our business and support operating decisions. The company believes such non-GAAP financial measures (1) provide useful information to investors regarding the underlying business trends and performance of the company’s ongoing operations, (2) are useful for period-over-period comparisons of such operations and results, that may be more easily compared to peer companies and allow investors a view to the company’s operating results during the integration period of the acquisitions of Aprimo and Aster Data, (3) provide useful information to management and investors regarding present and future business trends, and (4) provide consistency and comparability with past reports and projections of future results.


(a) Earnings Per Share Reconciliation of GAAP to Non-GAAP Measures

 

     For the Periods Ended September 30         
     Three Months      Nine Months      2011 FY  
     2011      2010      2011     2010      Guidance  

Diluted Earnings Per Share (GAAP)

   $ 0.51       $ 0.44       $ 1.48      $ 1.27       $
$
1.98 -
2.03
  
  

Excluding:

             

Gain from equity investments

           (0.13        (0.13

Stock-based compensation expense

     0.03         0.02         0.09        0.06         0.12   

Purchase accounting adjustments

     0.01            0.06           0.07   

Amortization of acquisition-related intangible assets

     0.03            0.07           0.09   

Transaction, integration and reorganization related costs

     0.01            0.09           0.12   
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Adjusted Diluted Earnings Per Share (Non-GAAP)

   $ 0.59       $ 0.46       $ 1.66      $ 1.33       $
$
2.25 -
2.30
  
  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

 

(b) Gross Margin Reconciliation of GAAP to Non-GAAP Measures

 

     For the Periods Ended September 30  
     Three Months     Nine Months  
     2011     2010     %
chg
    2011     2010     %
chg
 

Gross Margin (GAAP)

   $ 328      $ 279        18   $ 919      $ 783        17

% of Revenue

     54.5     57.1       54.4     56.4  

Excluding:

            

Stock-based compensation expense

     1        1          3        2     

Purchase accounting adjustments

     3            15       

Amortization of acquisition-related intangible assets

     4            11       

Transaction, integration and reorganization related costs

           2       
  

 

 

   

 

 

     

 

 

   

 

 

   

Adjusted Gross Margin (Non-GAAP)

   $ 336      $ 280        20   $ 950      $ 785        21
  

 

 

   

 

 

     

 

 

   

 

 

   

% of Revenue (non-GAAP)

     55.4     57.3       55.7     56.6  

 

(c) Operating Income Reconciliation of GAAP to Non-GAAP Measures

 

     For the Periods Ended September 30  
     Three Months     Nine Months  
     2011     2010     %
chg
    2011     2010     %
chg
 

Operating Income (GAAP)

   $ 122      $ 106        15   $ 323      $ 298        8

% of Revenue (GAAP)

     20.3     21.7       19.1     21.5  

Excluding:

            

Stock-based compensation expense

     8        7          25        18     

Purchase accounting adjustments

     3            15       

Amortization of acquisition-related intangible assets

     6            18       

Transaction, integration and reorganization related costs

     4            21       
  

 

 

   

 

 

     

 

 

   

 

 

   

Adjusted Operating Income (Non-GAAP)

   $ 143      $ 113        27   $ 402      $ 316        27
  

 

 

   

 

 

     

 

 

   

 

 

   

% of Revenue (non-GAAP)

     23.6     23.1       23.6     22.8  


3. As described above, the company believes that free cash flow is a useful non-GAAP measure for investors. Teradata defines free cash flow as cash provided/used by operating activities less capital expenditures for property and equipment, and additions to capitalized software. Free cash flow does not have a uniform definition under GAAP and therefore, Teradata’s definition may differ from other companies’ definitions of this measure. Teradata’s management uses free cash flow to assess the financial performance of the company and believes it is useful for investors because it relates the operating cash flow of the company to the capital that is spent to continue and improve business operations. In particular, free cash flow indicates the amount of cash generated after capital expenditures for, among other things, investment in the company’s existing businesses, strategic acquisitions, strengthening the company’s balance sheet, repurchase of company stock and repayment of the company’s debt obligations, if any. Free cash flow does not represent the residual cash flow available for discretionary expenditures since there may be other nondiscretionary expenditures that are not deducted from the measure. This non-GAAP measure is not meant to be considered in isolation or as a substitute for or superior to results determined in accordance with GAAP, and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP.

Note to Investors

This news release contains forward-looking statements, including statements as to anticipated or expected results, beliefs, opinions and future financial performance, within the meaning of Section 21E of the Securities and Exchange Act of 1934. Forward-looking statements include projections of revenue, profit growth and other financial items, future economic performance and statements concerning analysts’ earnings estimates, among other things. These forward-looking statements are based on current expectations and assumptions and involve risks and uncertainties that could cause Teradata’s actual results to differ materially. In addition to the factors discussed in this release, other risks and uncertainties could affect our future results, and could cause actual results to differ materially from those expressed in such forward-looking statements. Such factors include those relating to: the global economic environment in general or on the ability of our suppliers to meet their commitments to us, or the timing of purchases by our current and potential customers, and other general economic and business conditions; the rapidly changing and intensely competitive nature of the information technology industry and the enterprise data warehousing business, including the increased pressure on price/performance for data warehousing solutions; fluctuations in our operating results, unanticipated delays or accelerations in our sales cycles and the difficulty of accurately estimating revenues; risks inherent in operating in foreign countries, including the impact of economic, political, legal, regulatory, compliance, cultural, foreign currency fluctuations and other conditions abroad; the timely and successful development, production or acquisition and market acceptance of new and existing products and services, including our ability to accelerate market acceptance of new products and services as well as the reliability, quality and operability of new products because of the difficulty and complexity associated with their testing and production; tax rates; turnover of workforce and the ability to attract and retain skilled employees; availability and successful exploitation of new acquisition and alliance opportunities; our ability to execute integration plans for newly acquired entities, including the possibility that expected synergies and operating efficiencies may not be achieved, that such integration efforts may be more difficult, time-consuming or costly than expected, and that operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) may be greater than expected following the transaction; recurring revenue may decline or fail to be renewed; changes in Generally Accepted Accounting Principles (GAAP) and the resulting impact, if any, on the company’s accounting policies; continued efforts to establish and maintain best-in-class internal information technology and control systems; and other factors described from time to time in the company’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 10-K and subsequent quarterly reports on Forms 10-Q, as well as the company’s annual reports to stockholders. The company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.


Schedule A

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TERADATA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

(in millions, except per share amounts)

 

     For the Period Ended September 30  
     Three Months     Nine Months  
     2011     2010     % Chg     2011     2010     % Chg  

Revenue

            

Products

   $ 287      $ 243        18   $ 791      $ 666        19

Services

     315        246        28     898        722        24
  

 

 

   

 

 

     

 

 

   

 

 

   

Total revenue

     602        489        23     1,689        1,388        22

Product gross margin

     188        171          520        451     

% of Revenue

     65.5     70.4       65.7     67.7  

Services gross margin

     140        108          399        332     

% of Revenue

     44.4     43.9       44.4     46.0  
  

 

 

   

 

 

     

 

 

   

 

 

   

Total gross margin

     328        279          919        783     

% of Revenue

     54.5     57.1       54.4     56.4  

Selling, general and administrative expenses

     163        133          478        377     

Research and development expenses

     43        40          118        108     
  

 

 

   

 

 

     

 

 

   

 

 

   

Income from operations

     122        106          323        298     

% of Revenue

     20.3     21.7       19.1     21.5  

Other (expense) income, net

     (1     —            25        —       

Income before income taxes

     121        106          348        298     

% of Revenue

     20.1     21.7       20.6     21.5  

Income tax expense

     34        31          93        82     
  

 

 

   

 

 

     

 

 

   

 

 

   

% Tax rate

     28     29       27     28  

Net income

   $ 87      $ 75        $ 255      $ 216     
  

 

 

   

 

 

     

 

 

   

 

 

   

% of Revenue

     14.5     15.3       15.1     15.6  

Net income per common share

            

Basic

   $ 0.52      $ 0.45        $ 1.52      $ 1.29     

Diluted

   $ 0.51      $ 0.44        $ 1.48      $ 1.27     

Weighted average common shares outstanding

            

Basic

     167.9        167.2          168.3        167.3     

Diluted

     171.7        170.1          172.1        170.1     


Schedule B

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TERADATA CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(in millions)

 

     September 30,
2011
    June 30,
2011
    December 31,
2010
 

Assets

      

Current assets

      

Cash and cash equivalents

   $ 691      $ 682      $ 883   

Accounts receivable, net

     441        416        402   

Inventories

     64        59        65   

Other current assets

     65        65        56   
  

 

 

   

 

 

   

 

 

 

Total current assets

     1,261        1,222        1,406   

Property and equipment, net

     119        119        105   

Capitalized software, net

     140        133        116   

Goodwill

     736        714        136   

Acquired intangible assets

     171        205        12   

Deferred income taxes

     48        58        59   

Other assets

     11        10        49   
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 2,486      $ 2,461      $ 1,883   
  

 

 

   

 

 

   

 

 

 

Liabilities and stockholders’ equity

      

Current liabilities

      

Accounts payable

   $ 96      $ 87      $ 102   

Payroll and benefits liabilities

     140        128        134   

Deferred revenue

     353        392        263   

Other current liabilities

     82        72        70   
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     671        679        569   

Long-term debt

     293        295        —     

Pension and other postemployment plan liabilities

     83        85        85   

Other liabilities

     38        37        40   
  

 

 

   

 

 

   

 

 

 

Total liabilities

     1,085        1,096        694   
  

 

 

   

 

 

   

 

 

 

Stockholders’ equity

      

Preferred stock

     —          —          —     

Common stock

     2        2        2   

Paid-in capital

     744        730        690   

Treasury Stock

     (494     (437     (399

Retained earnings

     1,139        1,052        884   

Accumulated other comprehensive income

     10        18        12   
  

 

 

   

 

 

   

 

 

 

Total stockholders’ equity

     1,401        1,365        1,189   
  

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 2,486      $ 2,461      $ 1,883   
  

 

 

   

 

 

   

 

 

 


Schedule C

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TERADATA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(in millions)

 

     For the Period Ended September 30  
     Three Months     Nine Months  
     2011     2010     2011     2010  

Operating activities

        

Net income

   $ 87      $ 75      $ 255      $ 216   

Adjustments to reconcile net income to net cash provided by operating activities:

        

Depreciation and amortization

     25        15        74        43   

Stock-based compensation expense

     8        7        25        18   

Excess tax benefit from stock-based compensation

     (1     (1     (10     (3

Deferred income taxes

     20        5        31        16   

Gain on investments

     —          —          (28     —     

Changes in assets and liabilities:

        

Receivables

     (25     (29     (12     (24

Inventories

     (5     (17     —          (18

Current payables and accrued expenses

     30        36        —          (7

Deferred revenue

     (38     (41     57        11   

Other assets and liabilities

     1        15        (5     13   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net cash provided by operating activities

     102        65        387        265   

Investing activities

        

Expenditures for property and equipment

     (9     (8     (31     (25

Additions to capitalized software

     (18     (10     (56     (37

Business acquisitions and other investing activities, net

     (3     (29     (722     (61
  

 

 

   

 

 

   

 

 

   

 

 

 

Net cash used in investing activities

     (30     (47     (809     (123

Financing activities

        

Repurchases of common stock

     (57     (17     (95     (88

Proceeds from long-term borrowings

     —          —          600        —     

Repayments of long-term borrowings

     —          —          (300     —     

Excess tax benefit from stock-based compensation

     1        1        10        3   

Other financing activities, net

     3        9        19        21   
  

 

 

   

 

 

   

 

 

   

 

 

 

Net cash (used in) provided by financing activities

     (53     (7     234        (64

Effect of exchange rate changes on cash and cash equivalents

     (10     6        (4     2   
  

 

 

   

 

 

   

 

 

   

 

 

 

Increase (decrease) in cash and cash equivalents

     9        17        (192     80   

Cash and cash equivalents at beginning of period

     682        724        883        661   
  

 

 

   

 

 

   

 

 

   

 

 

 

Cash and cash equivalents at end of period

   $ 691      $ 741      $ 691      $ 741   
  

 

 

   

 

 

   

 

 

   

 

 

 


Schedule D

LOGO

TERADATA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(in millions)

 

     For the Period Ended September 30  
     Three Months     Nine Months  
     2011     2010     % Change
As Reported
    % Change
Constant
Currency
    2011     2010     % Change
As Reported
    % Change
Constant
Currency
 

Segment Revenue

                

Americas

   $ 375      $ 292        28     28   $ 1,021      $ 825        24     23

EMEA

     133        109        22     14     403        323        25     17

APJ

     94        88        7     -2     265        240        10     1
  

 

 

   

 

 

       

 

 

   

 

 

     

Total revenue

     602        489        23     19     1,689        1,388        22     18

Segment gross margin

                

Americas

     223        180            592        497       

% of Revenue

     59.5     61.6         58.0     60.2    

EMEA

     62        56            208        170       

% of Revenue

     46.6     51.4         51.6     52.6    

APJ

     43        43            119        116       

% of Revenue

     45.7     48.9         44.9     48.3    
  

 

 

   

 

 

       

 

 

   

 

 

     

Total gross margin

     328        279            919        783       

% of Revenue

     54.5     57.1         54.4     56.4    

Selling, general and administrative expenses

     163        133            478        377       

Research and development expenses

     43        40            118        108       
  

 

 

   

 

 

       

 

 

   

 

 

     

Income from operations

   $ 122      $ 106          $ 323      $ 298       
  

 

 

   

 

 

       

 

 

   

 

 

     

% of Revenue

     20.3     21.7         19.1     21.5