Goodwill and Purchased and Other Intangibles

6 Months Ended

Jun. 01, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

GOODWILL AND PURCHASED AND OTHER INTANGIBLES

Goodwill as of June 1, 2012 and December 2, 2011 was $4.123 billion and $3.849 billion, respectively. The increase was primarily due to our acquisition of Efficient Frontier and foreign currency translation adjustments. During the second quarter of fiscal 2012, we completed our annual goodwill impairment test associated with our three reporting units - Digital Media, Digital Marketing and Print and Publishing - and determined there was no impairment of goodwill.

Purchased and other intangible assets subject to amortization as of June 1, 2012 and December 2, 2011 were as follows (in thousands):



	2012							2011
	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Purchased technology	$	364,506	$	(124,215	)	$	240,291	$	314,057	$	(91,363	)	$	222,694
Customer contracts and relationships	$	313,892	$	(60,915	)	$	252,977	$	433,534	$	(229,364	)	$	204,170
Trademarks	52,950		(15,124		)	37,826		52,734		(11,217		)	41,517
Acquired rights to use technology	103,925		(50,995		)	52,930		106,865		(48,137		)	58,728
Localization	6,745		(5,058		)	1,687		9,762		(6,591		)	3,171
Other intangibles	22,416		(7,795		)	14,621		63,906		(48,660		)	15,246
Total other intangible assets	$	499,928	$	(139,887	)	$	360,041	$	666,801	$	(343,969	)	$	322,832
Purchased and other intangible assets, net	$	864,434	$	(264,102	)	$	600,332	$	980,858	$	(435,332	)	$	545,526

Amortization expense related to purchased and other intangible assets was $39.5 million and $72.6 million for the three and six months ended June 1, 2012, respectively. Comparatively, amortization expense was $33.6 million and $66.8 million for the three and six months ended June 3, 2011, respectively. Of these amounts, $27.0 million and $48.6 million were included in cost of sales for the three and six months ended June 1, 2012, respectively, and $23.3 million and $46.2 million were included in cost of sales for the three and six months ended June 3, 2011, respectively.

As of June 1, 2012, we expect amortization expense in future periods to be as follows (in thousands):



Fiscal Year	Purchased Technology		Other Intangible Assets
Remainder of 2012	$	37,382	$	31,863
2013	69,852		59,907
2014	63,808		55,762
2015	49,193		49,897
2016	11,492		44,462
Thereafter	8,564		118,150
Total expected amortization expense	$	240,291	$	360,041

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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