Electronic Arts 2000 Annual Report Download - page 21

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The following table presents pro-forma results of operations allocating taxes between EA Core and EA.com. Consolidated
taxes have been allocated to EA Core and EA.com on a pro rata basis based on the consolidated effective tax rates, thereby
giving EA.com the tax benefit of its losses which is utilized by the consolidated group. Such tax benefit could not be recognized
by EA.com on a stand-alone basis. The sum of tax expense and tax benefit for EA Core and EA.com is the same as consolidated
tax expense. This presentation represents how management analyzes each segment of the business (in thousands):
EA Core Adjustments and
Year Ended March 31, 2000 (excl. EA.com) EA.com Eliminations Electronic Arts
Income (loss) before provision for income
taxes and minority interest $ 224,404 $ (54,590) $ – $ 169,814
Provision (benefit) for income taxes 69,565 (16,923) – 52,642
Income (loss) before minority interest 154,839 (37,667) – 117,172
Minority interest in consolidated joint venture (421) – – (421)
Net income (loss) $ 154,418 $ (37,667) $ – $116,751
EA Core Adjustments and
Year Ended March 31, 1999 (excl. EA.com) EA.com Eliminations Electronic Arts
Income (loss) before provision for income
taxes and minority interest $ 127,338 $ (8,880) $ – $ 118,458
Provision (benefit) for income taxes 48,256 (2,842) – 45,414
Income (loss) before minority interest 79,082 (6,038) – 73,044
Minority interest in consolidated joint venture (172) – – (172)
Net income (loss) $ 78,910 $ (6,038) $ – $ 72,872
Costs and Expenses, Interest and Other Income, Net, Income Taxes and Net Income
Information about our costs and expenses, interest and other income, net, income taxes and net income for fiscal 2000 and
1999 is presented below:
Percent of Net Revenues
2000 1999
Cost of goods sold 49.7 % 51.4 %
Marketing and sales 13.3 13.4
General and administrative 6.5 6.2
Research and development (includes network development and support) 18.4 16.3
Charge for acquired in-process technology 0.5 3.6
Amortization of intangibles 0.8 0.5
Interest and other income, net 1.1 1.1
Income taxes – effective tax rate 31.0 38.3
Net income 8.2 % 6.0 %
EA 2000 AR
19
MD&A