Electronic Arts 2010 Annual Report Download - page 124

year 2009, we incurred $34 million of reorganization charges, of which $22 million was for facilities-related
expenses and $12 million related to other expenses, including contracted services costs to assist in the
reorganization of our business support functions. We do not expect to incur any additional charges under this
plan.
Amortization of Intangibles
Amortization of intangibles for fiscal years 2010 and 2009 was as follows (in millions):
March 31,
2010
% of Net
Revenue
March 31,
2009
% of Net
Revenue $ Change % Change
$53 1% $58 1% $(5) (9%)
Amortization of intangibles decreased by $5 million, or 9 percent, in fiscal year 2010, as compared to fiscal year
2009, primarily due to a change in the estimated useful lives of certain intangibles. This decrease is partially
offset by the amortization of intangibles related to our acquisition of Playfish.
Acquired In-Process Technology
Prior to the adoption of FASB ASC 805, upon consummation of an acquisition, we generally incurred a charge
for the related acquired in-process technology, as reflected in our Consolidated Statements of Operations. The
development of a majority of the projects for which we incurred an acquired-in process technology charge in
connection with our acquisition of VGH were either completed or did not reach technological feasibility and
therefore were abandoned. As of March 31, 2010, we had one project in connection with our acquisition of VGH
that continued to be in-process. See Note 5 of the Notes to Consolidated Financial Statements included in Item 8
of this report.
Certain Abandoned Acquisition-Related Costs
Certain abandoned acquisition-related costs consist of costs we incurred in connection with the abandoned
acquisition of Take-Two. On August 18, 2008, we allowed our tender offer for Take-Two shares to expire and on
September 14, 2008, we announced that we had terminated discussions with Take-Two. As a result, during the
fiscal year ended March 31, 2009, we recognized $21 million in related costs consisting of legal, banking and
other consulting fees.
Goodwill Impairment
Adverse economic conditions, including the decline in our market capitalization and our expected financial
performance at the time, indicated that a potential impairment of goodwill existed during the fiscal year ended
March 31, 2009. As a result, we performed goodwill impairment tests for our reporting units. As a result of the
goodwill impairment analysis, we determined that our EA Mobile reporting unit’s goodwill was impaired.
Substantially all of our goodwill associated with our EA Mobile reporting unit was derived from our fiscal 2006
acquisition of JAMDAT Mobile Inc. During the fiscal year ended March 31, 2009, we recognized a goodwill
impairment charge of $368 million related to our EA Mobile reporting unit. During the fiscal year ended
March 31, 2010, we performed our annual goodwill impairment test for our reporting units, and we determined
that there were no indicators of impairment to our goodwill. There were no events or circumstances subsequent
to the completion of our impairment testing that indicated an assessment was necessary.
Losses on Strategic Investments, Net
Losses on strategic investments, net for fiscal years 2010 and 2009 were as follows (in millions):
March 31,
2010
% of Net
Revenue
March 31,
2009
% of Net
Revenue $ Change % Change
$(26) (1%) $(62) (1%) $36 58%
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