Segment Information

9 Months Ended

Sep. 30, 2015

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

The Enterprise and Service Provider and the Mobility Apps business units constitute the Company’s two reportable segments. The Company does not engage in intercompany revenue transfers between segments. The Company’s chief operating decision maker (“CODM”) evaluates the Company’s performance based primarily on profitability from its Enterprise and Service Provider and Mobility Apps products. Segment profit for each segment includes certain research and development, sales, marketing and services and general and administrative expenses directly attributable to the segment as well as other corporate costs allocated to the segment and excludes certain expenses that are managed outside of the reportable segments. Costs excluded from segment profit primarily consist of certain restructuring charges, stock-based compensation costs, charges or benefits related to significant litigation that are not anticipated to be ongoing costs, amortization of product related intangible assets, amortization and impairment of other intangible assets, net interest and other expense, net. Accounting policies of the Company’s segments are the same as its consolidated accounting policies.

Net revenues and segment profit, classified by the Company’s two reportable segments were as follows (in thousands):

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2015			2014			2015			2014
Net revenues:
Enterprise and Service Provider	$	622,513		$	593,741		$	1,833,126		$	1,808,209
Mobility Apps	190,757			165,253			537,705			483,164
Consolidated	$	813,270		$	758,994		$	2,370,831		$	2,291,373
Segment profit(1):
Enterprise and Service Provider	$	190,372		$	131,409		$	497,351		$	394,536
Mobility Apps	22,901			27,402			60,202			92,333
Unallocated expenses(2):
Amortization and impairment of intangible assets	(97,038		)	(33,915		)	(154,931		)	(135,515		)
Patent litigation charge	—			(20,727		)	—			(20,727		)
Other	—			—			982			—
Restructuring	(13,766		)	(3,124		)	(62,251		)	(17,285		)
Net interest and other expense, net	(10,440		)	(10,374		)	(37,997		)	(16,897		)
Stock-based compensation	(38,671		)	(42,449		)	(103,674		)	(128,440		)
Consolidated income before income taxes	$	53,358		$	48,222		$	199,682		$	168,005

(1) The Company revised its methodology for allocating certain corporate costs within General and administrative expenses to more closely align these costs to the employees directly utilizing the related services within each of its reporting segments, thereby impacting Segment profit for the nine months ended September 30, 2015. Accordingly, the adjusted Segment profit for the Enterprise and Service Provider and Mobility Apps segments is $132.1 million and $15.0 million, respectively for the three months ended March 31, 2015 and $174.9 million and $22.3 million, respectively for the three months ended June 30, 2015. This change in presentation does not affect the Company's consolidated financial position, results from operations or cash flows.

(2) Represents expenses presented to management on a consolidated basis only and not allocated to the operating segments.

Revenues by Product Grouping

Revenues by product grouping for the Company’s Enterprise and Service Provider and Mobility Apps business units were as follows (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015		2014
Net revenues:
Enterprise and Service Provider
Workspace Services revenues(1)	$	396,167	$	392,875	$	1,193,178	$	1,170,103
Delivery Networking revenues(2)	187,447		155,388		521,488		501,231
Professional services(3)	36,676		42,322		110,576		126,775
Other	2,223		3,156		7,884		10,100
Total Enterprise and Service Provider revenues	622,513		593,741		1,833,126		1,808,209
Mobility Apps revenues	190,757		165,253		537,705		483,164
Total net revenues	$	813,270	$	758,994	$	2,370,831	$	2,291,373

(1) Workspace Services revenues are primarily comprised of sales from the Company’s windows app delivery products, which include XenDesktop and XenApp, and the Company's mobile app delivery products, which include XenMobile and related license updates and maintenance and support.

(2) Delivery Networking revenues primarily include NetScaler, ByteMobile Smart Capacity and CloudBridge products and related license updates and maintenance and support.

(3) Professional services revenues are primarily comprised of revenues from consulting services and product training and certification services.

Revenues by Geographic Location

The following table presents revenues by segment and geographic location, for the following periods (in thousands):

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2015		2014		2015		2014
Net revenues:
Enterprise and Service Provider
Americas	$	345,417	$	318,180	$	1,005,967	$	977,166
EMEA	206,377		202,557		616,558		610,254
Asia-Pacific	70,719		73,004		210,601		220,789
Total Enterprise and Service Provider revenues	622,513		593,741		1,833,126		1,808,209
Mobility Apps
Americas	160,079		137,031		452,672		400,580
EMEA	24,480		22,407		67,843		65,780
Asia-Pacific	6,198		5,815		17,190		16,804
Total Mobility Apps revenues	190,757		165,253		537,705		483,164
Total net revenues	$	813,270	$	758,994	$	2,370,831	$	2,291,373