SEGMENT INFORMATION (Tables)

3 Months Ended

Aug. 31, 2015

Segment Information [Abstract]

Summary of Businesses and Operating Segments Results

	Three Months Ended August 31,
(in millions)	2015		2014
Cloud software and on-premise software:
Revenues(1)	$	1,603	$	1,707
Cloud software as a service and platform as a service expenses		268		143
Sales and distribution expenses		1,286		1,279
Margin(2)	$	49	$	285
Cloud infrastructure as a service:
Revenues	$	160	$	138
Cloud infrastructure as a service expenses		85		76
Sales and distribution expenses		22		18
Margin(2)	$	53	$	44
Software license updates and product support:
Revenues(1)	$	4,697	$	4,731
Software license updates and product support expenses		271		257
Margin(2)	$	4,426	$	4,474
Total cloud and on-premise software business:
Revenues(1)	$	6,460	$	6,576
Expenses		1,932		1,773
Margin(2)	$	4,528	$	4,803
Hardware products:
Revenues	$	570	$	578
Hardware products expenses		301		297
Sales and distribution expenses		204		201
Margin(2)	$	65	$	80
Hardware support:
Revenues(1)	$	559	$	588
Hardware support expenses		172		184
Margin(2)	$	387	$	404
Total hardware business:
Revenues(1)	$	1,129	$	1,166
Expenses		677		682
Margin(2)	$	452	$	484
Total services business:
Revenues(1)	$	862	$	857
Services expenses		678		665
Margin(2)	$	184	$	192
Totals:
Revenues(1)	$	8,451	$	8,599
Expenses		3,287		3,120
Margin(2)	$	5,164	$	5,479

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(1)

Cloud software and on-premise software revenues for management reporting included revenues related to cloud SaaS and PaaS contracts that would have otherwise been recorded by the acquired businesses as independent entities but were not recognized in the accompanying condensed consolidated statements of operations in the amounts of $1 million and $2 million for the three months ended August 31, 2015 and 2014, respectively. Software license updates and product support revenues for management reporting included revenues related to software support contracts that would have otherwise been recorded by the acquired businesses as independent entities but were not recognized in the accompanying condensed consolidated statements of operations in the amount of $1 million for the three months ended August 31, 2015. In addition, we did not recognize hardware support revenues related to hardware support contracts that would have otherwise been recorded by the acquired businesses as independent entities in the amount of $1 million for each of the three months ended August 31, 2015 and 2014, respectively. See Note 7 for an explanation of these adjustments and the table below for a reconciliation of our total operating segment revenues to our total revenues. Our new software license and services revenues for management reporting also differ from amounts reported per our consolidated statements of operations for the periods presented due to certain insignificant reclassifications between these lines for management reporting purposes.

(2)

The margins reported reflect only the direct controllable costs of each line of business and do not include allocations of product development, marketing and partner programs, and corporate, general and administrative and information technology expenses. Additionally, the margins reported do not reflect amortization of intangible assets, acquisition related and other expenses, restructuring expenses, stock-based compensation, interest expense or certain other income (expense), net.

Reconciliation of Total Operating Segment Revenues to Total Revenues

	Three Months Ended August 31,
(in millions)	2015		2014
Total revenues for operating segments	$	8,451	$	8,599
Cloud software as a service and platform as a service revenues (1)		(1)		(2)
Software license updates and product support revenues(1)		(1)		—
Hardware support revenues(1)		(1)		(1)
Total revenues	$	8,448	$	8,596

Reconciliation of Total Operating Segment Margin to Income before Provision for Income Taxes

Total margin for operating segments	$	5,164	$	5,479
Cloud software as a service and platform as a service revenues (1)		(1)		(2)
Software license updates and product support revenues(1)		(1)		—
Hardware support revenues(1)		(1)		(1)
Product development		(1,188)		(1,174)
Marketing and partner program expenses		(109)		(119)
Corporate, general and administrative and information technology expenses		(394)		(367)
Amortization of intangible assets		(452)		(547)
Acquisition related and other		(31)		(25)
Restructuring		(83)		(69)
Stock-based compensation		(250)		(212)
Interest expense		(374)		(261)
Non-operating income, net		30		16
Income before provision for income taxes	$	2,310	$	2,718

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(1) Cloud software as a service and platform as a service revenues, software license updates and product support revenues and hardware support revenues for management reporting included revenues that would have otherwise been recorded by our acquired businesses as independent entities but were not recognized in the accompanying condensed consolidated statements of operations for the periods presented due to business combination accounting requirements. Refer to footnote one to our business and operating segments summary results table above in this Note 11 for additional information.