Yahoo 2014 Annual Report Download - page 76

During the year ended December 31, 2013, the $23 million used in investing activities was due to
purchases of marketable securities of $3.2 billion, $338 million used for capital expenditures, and $1.2
billion used for acquisitions, offset by net proceeds from sales and maturities of marketable securities
of $3.6 billion, $800 million received from the redemption of the Alibaba Group Preference Shares,
$80 million from sales of patents, and $290 million from the settlement of foreign exchange contracts
(including the settlement of certain foreign exchange forward contracts designated as net
investment hedges).
During the year ended December 31, 2012, the $3.4 billion provided by investing activities was due to
cash proceeds, net of fees, of $6.2 billion received in connection with the Initial Repurchase and
proceeds from the sale of investments and other investing activities of $26 million. This was offset by
$2.4 billion utilized for net purchases of marketable securities and $506 million used from capital
expenditures.
Net cash used in financing activities.
Cash used in financing activities is driven by stock repurchases offset by employee stock option
exercises and employee stock purchases.
During the year ended December 31, 2014, the $4 billion used in financing activities was due to $4.2
billion used for the repurchase of shares of our common stock at an average price of $40.94 per
share, $22 million used for distributions to noncontrolling interests, and $295 million used for tax
withholding payments related to net share settlements of restricted stock units and other financing
activities. This use of cash was partially offset by $308 million in cash proceeds received from
employee stock option exercises and employee stock purchases made through our employee stock
purchase plan, and an excess tax benefit from stock-based awards of $150 million.
During the year ended December 31, 2013, the $1.7 billion used in financing activities was due to $3.3
billion used for the repurchase of 129 million shares of common stock at an average price of $25.95
per share, $206 million used to purchase note hedges, and $149 million used for tax withholding
payments related to net share settlements of restricted stock units and other financing activities. This
use of cash was partially offset by $1.4 billion in cash proceeds from issuance of the Notes, $125
million in cash proceeds from the issuance of warrants, $353 million in cash proceeds received from
employee stock option exercises and employee stock purchases made through our employee stock
purchase plan, and an excess tax benefit from stock-based awards of $64 million.
During the year ended December 31, 2012, the $2 billion used in financing activities was due to $2.2
billion used for the repurchase of 126 million shares of our common stock at an average price of
$17.20 per share, $61 million for tax withholding payments related to net share settlements of
restricted stock units, and $5 million for other financing activities. This use of cash was partially offset
by $218 million in cash proceeds from employee stock option exercises and employee stock
purchases made through our employee stock purchase plan, and an excess tax benefit from stock-
based awards of $36 million.
In 2014, 2013, and 2012, $150 million, $64 million, and $36 million, respectively, of excess tax benefits
from stock-based awards for options exercised in current and prior periods were included as a source
of cash flows from financing activities. These excess tax benefits represent the reduction in income
taxes otherwise payable during the period, attributable to the actual gross tax benefits in excess of
the expected tax benefits for options exercised in current and prior periods. We have accumulated
excess tax deductions relating to stock options exercised prior to January 1, 2006 available to reduce
income taxes otherwise payable. To the extent such deductions reduce income taxes payable in the
current year, they are reported as financing activities in the consolidated statements of cash flows.
See Note 14—“Employee Benefits” in the Notes to our consolidated financial statements for additional
information.
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