Symantec 2007 Annual Report Download - page 46

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a result of growth in our maintenance renewals due to an increasing installed base, increased demand for our service
offerings, other acquisitions, and the combination of our buying programs implemented in the December 2006
quarter, which impacted VSOE methodology and classification of Licenses revenue and Content, subscriptions, and
maintenance revenue, as discussed above under “Total Net Revenues.”
Content, subscriptions, and maintenance revenues increased in fiscal 2006 as compared to fiscal 2005
primarily due to the inclusion of the storage and availability products and services obtained through our acquisition
of Veritas. These product and services contributed $534 million of Content, subscriptions, and maintenance
revenues in fiscal 2006 for which there was no comparable revenue in fiscal 2005. In addition, in fiscal 2006,
Content, subscriptions, and maintenance revenues related to our consumer security products increased $233 million
as compared to fiscal 2005 due primarily to the classification of $160 million of consumer revenue as Content,
subscriptions, and maintenance (rather than Licenses) in fiscal 2006 as a result of recognizing revenue from sales of
consumer products that include content updates ratably beginning in the December 2005 quarter as discussed above.
Revenue related to our enterprise security products increased $133 million, primarily due to increased awareness of
information security threats.
Licenses revenue
2007 2006 2005
Year Ended March 31,
($ in thousands)
Licenses revenue . . . ............................. $1,281,794 $1,270,181 $637,539
Percentage of total net revenues ..................... 25% 31% 25%
Period over period increase (decrease) ................. $ 11,613 $ 632,642
1% 99%
Licenses revenue increased in fiscal 2007 as compared to fiscal 2006 primarily due to the inclusion of the
storage and availability products obtained through our acquisition of Veritas for the full twelve months in the 2007
period compared to nine months in the 2006 period. These products contributed $268 million of Licenses revenues
in the June 2006 quarter for which there was no comparable revenue in the June 2006 quarter. Excluding this June
2006 contribution, License revenues were down significantly in both Security and Data Management and Data
Center Management segments as a result of the increased flexibility in contract terms and the combination of our
buying programs implemented in the December 2006 quarter, both of which caused a larger portion of contracts to
be classified as Content, subscriptions, and maintenance, which is subject to deferral, instead of Licenses revenue,
which is generally recognized immediately, as discussed above in “Total Net Revenues.”
Licenses revenue increased in fiscal 2006 as compared to fiscal 2005 primarily due to the inclusion of the
storage and availability products obtained through our acquisition of Veritas. These products contributed $835 mil-
lion of Licenses revenue in fiscal 2006 for which there was no comparable revenue in fiscal 2005. Our 2006
consumer products that include content updates were released in the December 2005 quarter, and we recognize
revenue related to these products ratably as Content, subscriptions, and maintenance revenues, which resulted in a
decrease in Licenses revenue of $160 million in fiscal 2006. Competitive pressures, a lack of high profile
information security threat activity during fiscal 2006, and to a lesser extent, a decrease in licensing of our enterprise
security products, also partially offset the overall increase in Licenses revenue.
Net revenues by segment
Consumer Products segment
2007 2006 2005
Year Ended March 31,
($ in thousands)
Consumer products revenues ...................... $1,590,529 $1,409,582 $1,343,059
Percentage of total net revenues .................... 30% 34% 52%
Period over period increase ....................... $ 180,947 $ 66,523
13% 5%
40