Symantec 2004 Annual Report Download - page 74

«72»SYMANTEC CORPORATION
2004 Annual Report
Over the past few years, it has become common for software
companies, including us, to receive claims of patent infringement.
At any given time, we are evaluating claims of patent infringement
asserted by several parties, with respect to certain of our products.
The outcome of any related litigation or negotiation could have
a material adverse impact on our future results of operations or
cash flows.
We are also involved in a number of other judicial and administrative
proceedings that are incidental to our business. We intend to
defend all of the aforementioned pending lawsuits vigorously.
Although adverse decisions (or settlements) may occur in one or
more of the cases, and it is not possible to estimate the possible
loss or losses from each of these cases, the final resolution of
these lawsuits, individually or in the aggregate, is not expected
to have a material adverse affect on our financial condition. We
have accrued certain estimated legal fees and expenses related
to certain of these matters; however, actual amounts may differ
materially from those estimated amounts.
Note 16. Segment Information
Our operating segments are significant strategic business units that
offer different products and services, distinguished by customer
needs. We have five operating segments: Enterprise Security,
Enterprise Administration, Consumer Products, Services and Other.
Our Consumer Products segment focuses on delivering our Internet
security and problem-solving products to individual users, home
offices and small businesses. Our Enterprise Security segment
provides security solutions for all tiers of a network: at the gateways
between the network and the outside world, at the servers that
act as the network’s vital organs, and at end-user devices, including
desktop PCs, laptops and handhelds. Our Enterprise Administration
segment offers open and modular products and services that
enable companies to effectively and efficiently manage their IT
infrastructures. Our Services segment provides information security
solutions that incorporate advanced technology, security best
practices and expertise, and global resources to help enable
e-business success. Our Other segment is comprised of sunset
products and products nearing the end of their life cycle. Also
included in the Other segment are all indirect costs, general and
administrative expenses, amortization of goodwill (through
March 31, 2002) and other intangible assets, and other assets and
charges, such as acquired in-process research and development,
legal judgments and settlements, and restructuring and site
closures which are not charged to the other operating segments.
During fiscal 2003, we realigned certain expenses within our
operating segments and reclassified fiscal 2002 information to
conform to the fiscal 2003 presentation. In addition, beginning
in fiscal 2003, we appropriately presented the amortization of
other intangible assets within Depreciation and amortization
expense by segment for fiscal 2002.
The accounting policies of the segments are the same as those
described in the summary of significant accounting polices,
with the exception of the amortization of acquired product rights,
which is included entirely in our Other segment. There are no
intersegment sales. Our chief operating decision maker evaluates
performance based on direct profit or loss from operations before
income taxes not including nonrecurring gains and losses, foreign
exchange gains and losses and miscellaneous other income and
expenses. The majority of our assets and liabilities are not discretely
allocated or reviewed by segment. The depreciation and amortization
of our property, equipment and leasehold improvements are allocated
based on headcount, unless specifically identified by segment.
SEGMENT INFORMATION
Consumer Enterprise Enterprise Total
(In thousands) Products Security Administration Services Other Company
Fiscal 2004
Revenue from external customers $871,980 $736,531 $219,604 $41,682 $ 332 $1,870,129
Operating income (loss) 530,473 134,627 143,634 (11,122) (284,027) 513,585
Depreciation & amortization expense 3,684 14,452 653 5,566 92,871 117,226
Fiscal 2003
Revenue from external customers 570,266 593,552 215,017 26,377 1,734 1,406,946
Operating income (loss) 293,695 119,226 160,077 (26,099) (205,387) 341,512
Depreciation & amortization expense 3,414 12,206 373 3,103 80,903 99,999
Fiscal 2002
Revenue from external customers 376,137 454,925 222,543 10,905 6,928 1,071,438
Operating income (loss) 155,370 108,267 155,495 (24,042) (387,049) 8,041
Depreciation & amortization expense 2,741 10,789 439 631 258,267 272,867