Electronic Arts 2011 Annual Report Download - page 162

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Deferred Net Revenue (Packaged Goods and Digital Content)
Deferred net revenue (packaged goods and digital content) was $1,005 million and $766 million as of March 31,
2011 and 2010, respectively. Deferred net revenue (packaged goods and digital content) includes the
unrecognized revenue from (1) bundled sales of certain online-enabled packaged goods and digital content for
which either we do not have vendor-specific objective evidence of fair value (“VSOE”) for the online service that
we provide in connection with the sale of the software or we have an obligation to provide future incremental
unspecified digital content, (2) certain packaged goods sales of massively-multiplayer online role-playing games,
and (3) sales of certain incremental content associated with our core subscription services that can only be played
online, which are types of “micro-transactions.” We recognize revenue from sales of online-enabled packaged
goods and digital content for which (1) we do not have VSOE for the online service that we provided in
connection with the sale and (2) we have an obligation to deliver incremental unspecified digital content in the
future without an additional fee on a straight-line basis generally over an estimated six-month period beginning
in the month after shipment. However, we expense the cost of goods sold related to these transactions during the
period in which the product is delivered (rather than on a deferred basis).
(10) INCOME TAXES
The components of our loss before provision for (benefit from) income taxes for the fiscal years ended March 31,
2011, 2010 and 2009 are as follows (in millions):
Year Ended March 31,
2011 2010 2009
Domestic ............................................................. $(189) $(501) $(670)
Foreign ............................................................... (90) (205) (185)
Loss before provision for (benefit from) income taxes .......................... $(279) $(706) $(855)
Provision for (benefit from) income taxes for the fiscal years ended March 31, 2011, 2010 and 2009 consisted of
(in millions):
Current Deferred Total
Year Ended March 31, 2011
Federal ............................................................. $(23) $ 2 $ (21)
State ............................................................... (6) 3 (3)
Foreign ............................................................. 23 (2) 21
$ (6) $ 3 $ (3)
Year Ended March 31, 2010
Federal ............................................................. $ (8) $(57) $ (65)
State ............................................................... 2 (4) (2)
Foreign ............................................................. 27 11 38
$ 21 $ (50) $ (29)
Year Ended March 31, 2009
Federal ............................................................. $(15) $161 $146
State ............................................................... (2) 76 74
Foreign ............................................................. 26 (13) 13
$ 9 $224 $233
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