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Annual Report
(8) RESTRUCTURING AND OTHER CHARGES
Restructuring and other restructuring plan-related information as of March 31, 2015 was as follows (in millions):
Fiscal 2011
Restructuring
Other Restructurings
and Reorganization
TotalOther Workforce
Facilities-
related Other
Balances as of March 31, 2012 ........................ $75 $— $ 3 $— $78
Charges to operations .............................. 6 10 2 9 $27
Charges settled in cash ............................. (24) (10) (1) (1) $(36)
Charges settled in non-cash ......................... — — — (7) $ (7)
Balances as of March 31, 2013 ........................ $57 $— $ 4 $ 1 $62
Charges to operations .............................. (2) — 1 — $ (1)
Charges settled in cash ............................. (8) — (3) — $(11)
Balances as of March 31, 2014 ........................ 47 — 2 1 50
Charges to operations .............................. — — — — $—
Charges settled in cash ............................. (36) — (1) (1) $(38)
Balances as of March 31, 2015 ........................ $11 $— $ 1 $— $12
Fiscal 2011 Restructuring
In fiscal year 2011, we announced a plan focused on the restructuring of certain licensing and developer
agreements in an effort to improve the long-term profitability of our packaged goods business. Under this plan,
we amended certain licensing and developer agreements. To a much lesser extent, as part of this restructuring we
had workforce reductions and facilities closures through March 31, 2011. Substantially all of these exit activities
were completed by March 31, 2011.
Since the inception of the fiscal 2011 restructuring plan through March 31, 2015, we have incurred charges of
$172 million, consisting of (1) $129 million related to the amendment of certain licensing agreements and other
intangible asset impairment costs, (2) $31 million related to the amendment of certain developer agreements, and
(3) $12 million in employee-related expenses. The $11 million restructuring accrual as of March 31, 2015 is
expected to be settled by December 2015. We do not expect to incur any additional restructuring charges under
this plan.
Other Restructurings and Reorganization
We also engaged in various other restructurings and a reorganization based on management decisions made in
fiscal years 2013 and 2009. We do not expect to incur any additional restructuring charges under these plans. The
$1 million restructuring accrual as of March 31, 2015 related to our other restructuring plans is expected to be
settled by April 2020.
(9) ROYALTIES AND LICENSES
Our royalty expenses consist of payments to (1) content licensors, (2) independent software developers, and
(3) co-publishing and distribution affiliates. License royalties consist of payments made to celebrities,
professional sports organizations, movie studios and other organizations for our use of their trademarks,
copyrights, personal publicity rights, content and/or other intellectual property. Royalty payments to independent
software developers are payments for the development of intellectual property related to our games. Co-
publishing and distribution royalties are payments made to third parties for the delivery of products.
Royalty-based obligations with content licensors and distribution affiliates are either paid in advance and
capitalized as prepaid royalties or are accrued as incurred and subsequently paid. These royalty-based obligations
are generally expensed to cost of revenue at the greater of the contractual rate or an effective royalty rate based
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