v3.2.0.727
INTANGIBLE ASSETS AND GOODWILL (Tables)
 12 Months Ended
May. 31, 2015
Intangible Assets and Goodwill [Abstract]  
Intangible Assets

 

 

Intangible Assets, Gross

 

Accumulated Amortization

 

Intangible Assets, Net

 

Weighted

(Dollars in millions)

 

May 31,
2014

 

Additions(1)

 

Retirements

 

May 31,
2015

 

May 31,
2014

 

Expense

 

Retirements

 

May 31,
2015

 

May 31,
2014

 

May 31,
2015

 

Average
Useful Life(2)

Software support agreements and related relationships

 

$

5,218

 

$

1,206

 

$

(2,234)

 

$

4,190

 

$

(4,403)

 

$

(531)

 

$

2,234

 

$

(2,700)

 

$

815

 

$

1,490

 

13 years

Hardware systems support agreements and related relationships

 

 

969

 

 

63

 

 

(20)

 

 

1,012

 

 

(530)

 

 

(144)

 

 

20

 

 

(654)

 

 

439

 

 

358

 

10 years

Developed technology

 

 

4,387

 

 

736

 

 

(521)

 

 

4,602

 

 

(2,176)

 

 

(700)

 

 

521

 

 

(2,355)

 

 

2,211

 

 

2,247

 

7 years

Core technology

 

 

1,617

 

 

—

 

 

(1,065)

 

 

552

 

 

(1,294)

 

 

(182)

 

 

1,065

 

 

(411)

 

 

323

 

 

141

 

N.A.

Customer relationships and contract backlog

 

 

2,054

 

 

204

 

 

(61)

 

 

2,197

 

 

(1,459)

 

 

(312)

 

 

61

 

 

(1,710)

 

 

595

 

 

487

 

6 years

SaaS, PaaS and IaaS agreements and related relationships and other

 

 

1,789

 

 

204

 

 

—

 

 

1,993

 

 

(305)

 

 

(203)

 

 

—

 

 

(508)

 

 

1,484

 

 

1,485

 

10 years

Trademarks

 

 

516

 

 

35

 

 

(50)

 

 

501

 

 

(276)

 

 

(77)

 

 

50

 

 

(303)

 

 

240

 

 

198

 

10 years

Total intangible assets subject to amortization

 

 

16,550

 

 

2,448

 

 

(3,951)

 

15,047

 

 

(10,443)

 

 

(2,149)

 

 

3,951

 

(8,641)

 

 

6,107

 

 

6,406

 

10 years

In-process research and development

 

 

30

 

 

(30)

 

 

     —

 

 

     —

 

 

 —

 

 

 —

 

 

—

 

 

 —

 

 

30

 

 

—

 

N.A.

Total intangible assets, net

 

$

16,580

 

$

2,418

 

$

(3,951)

$

15,047

 

$

(10,443)

 

$

(2,149)

 

$

3,951

$

(8,641)

 

$

6,137

 

$

6,406

 

  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

__________

(1)

The substantial majority of intangible assets acquired during fiscal 2015 related to our acquisition of MICROS.

(2)

Represents weighted average useful lives of intangible assets acquired during fiscal 2015.

 
Estimated Future Amortization Expenses Related to Intangible Assets

Fiscal 2016

$

1,624

Fiscal 2017

 

995

Fiscal 2018

 

848

Fiscal 2019

 

742

Fiscal 2020

 

598

Thereafter

 

1,599

Total intangible assets, net

$

6,406

 
Goodwill

(in millions)

 

New Software

 

Software

 

 

 

Consulting

 

Other, net(4)

 

Total Goodwill,

 net

Licenses and

License

 

Cloud

Updates and

Hardware

Software

Product

Systems

Subscriptions

Support

Support

Balances as of May 31, 2013

 

$

10,533

 

$

12,474

 

$

1,259

 

$

1,584

 

$

 1,493

 

$

27,343

         Allocation of goodwill(1)

 

 

875

 

 

—

 

 

380

 

 

13

 

 

 (1,268)

 

 

 —

         Goodwill from acquisitions

 

 

1,721

 

 

4

 

 

436

 

 

134

 

 

 —

 

 

2,295

         Goodwill adjustments, net(2)

 

 

10

 

 

(6)

 

 

7

 

 

2

 

 

1

 

 

14

Balances as of May 31, 2014

 

 

       13,139

 

 

12,472

 

 

2,082

 

 

1,733

 

 

226

 

 

29,652

         Goodwill from acquisitions

 

 

2,086

 

 

1,991

 

 

269

 

 

27

 

 

240

 

 

4,613

         Goodwill adjustments, net(2)

 

 

(8)

 

 

(2)

 

 

19

 

 

(1)

 

 

—

 

 

8

         Goodwill impairment(3)

 

 

—

 

 

—

 

 

—

 

 

—

 

 

(186)

 

 

(186)

Balances as of May 31, 2015

 

$

15,217

 

$

14,461

 

$

2,370

 

$

1,759

 

$

280

 

$

34,087

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

__________

     (1)

Represents the allocation of goodwill to our operating segments upon completion of our intangible asset valuations.

 

 

     (2)

Pursuant to our business combinations accounting policy, we recorded goodwill adjustments for the effect on goodwill of changes to net assets acquired during the measurement period (up to one year from the date of an acquisition). Goodwill adjustments were not significant to our previously reported operating results or financial position.

 

 

     (3)

During fiscal 2015, we recorded a $186 million goodwill impairment loss to our hardware systems products reporting unit. We considered several approaches to determine the fair value of our hardware systems reporting unit as of March 1, 2015 and concluded the most appropriate to be the income approach. The fair value of our hardware systems products reporting unit pursuant to the income approach was impacted by lower forecasted operating results for this reporting unit, primarily caused by lower forecasted revenues and our continued investment in hardware products research and development activities. We compared the implied fair value of goodwill in our hardware systems products reporting unit to its carrying value, which resulted in the $186 million goodwill impairment loss and represented the aggregate amount of goodwill for our hardware systems products reporting unit. The aggregate hardware systems reporting unit goodwill that was impaired in fiscal 2015 resulted from our acquisitions of Pillar Data Systems, Inc., Xsigo Systems, Inc., GreenBytes, Inc. and MICROS Systems, Inc. Such impairment loss was recorded to acquisition related and other expenses in our fiscal 2015 consolidated statement of operations. We did not recognize any goodwill impairment losses in fiscal 2014 or 2013.

 

 

     (4)

Represents goodwill allocated to our other operating segments. The balance as of May 31, 2013 included unallocated goodwill for certain of our acquisitions that was subsequently allocated based upon the finalization of valuations during fiscal 2014.