XML 39 R23.htm IDEA: XBRL DOCUMENT v3.21.2
Segment Disclosure
 12 Months Ended
Oct. 31, 2021
Segment Reporting [Abstract]  
Segment Disclosure Segment Disclosure
Segment reporting is based upon the “management approach,” i.e., how management organizes the Company’s operating segments for which separate financial information is (1) available and (2) evaluated regularly by the Chief Operating Decision Makers (CODMs) in deciding how to allocate resources and in assessing performance. The Company's CODMs are its two Co-Chief Executive Officers.
The Company has two reportable segments: (1) Semiconductor & System Design, which includes EDA tools, IP products, system integration solutions and other associated revenue categories, and (2) Software Integrity, which includes a comprehensive solution for building integrity—security, quality and compliance testing—into the customers’ software development lifecycle and supply chain.
The financial information provided to and used by the CODMs to assist in making operational decisions, allocating resources, and assessing performance reflects consolidated financial information as well as revenue, adjusted operating income, and adjusted operating margin information for the Semiconductor & System Design and Software Integrity segments, accompanied by disaggregated information relating to revenue by geographic region.
Information by reportable segment was as follows:
 Year Ended October 31,
 202120202019
 (in thousands)
Total Segments:
      Revenue$4,204,193 $3,685,281 $3,360,694 
      Adjusted operating income1,281,389 1,031,630 838,821 
      Adjusted operating margin30 %28 %25 %
Semiconductor & System Design:
      Revenue$3,810,409 $3,327,211 $3,026,097 
      Adjusted operating income1,243,078 990,837 806,618 
      Adjusted operating margin33 %30 %27 %
Software Integrity:
      Revenue$393,784 $358,070 $334,597 
      Adjusted operating income38,311 40,793 32,203 
      Adjusted operating margin10 %11 %10 %
Certain operating expenses are not allocated to the segments and are managed at a consolidated level. The unallocated expenses managed at a consolidated level, including amortization of intangible assets, stock-based compensation and certain other operating expenses, are presented in the table below to provide a reconciliation of the total adjusted operating income from segments to the Company's consolidated operating income:
 Year Ended October 31,
 202120202019
 (in thousands)
Total segment adjusted operating income$1,281,389 $1,031,630 $838,821 
Reconciling items:
      Amortization of intangible expense(82,380)(91,281)(100,914)
      Stock-based compensation expense(345,272)(248,584)(155,001)
      Other(118,947)(71,624)(62,675)
Total operating income$734,790 $620,141 $520,231 
The CODMs do not use total assets by segment to evaluate segment performance or allocate resources. As a result, total assets by segment are not required to be disclosed.
In allocating revenue to particular geographic areas, the CODMs consider where individual “seats” or licenses to the Company’s products are located. Revenue is defined as revenue from external customers. Revenue and property and equipment, net, related to operations in the United States and other geographic areas were:
 Year Ended October 31,
 202120202019
 (in thousands)
Revenue:
United States
$1,951,964 $1,774,348 $1,676,178 
Europe
440,825 385,287 349,033 
China
562,711 420,829 321,777 
Korea
427,471 389,008 353,358 
Other
821,222 715,809 660,348 
Consolidated$4,204,193 $3,685,281 $3,360,694 
 As of October 31,
 20212020
 (in thousands)
Property and Equipment, net:
United States
$283,602 $311,350 
Other188,796 172,468 
Total$472,398 $483,818 
Geographic revenue data for multi-regional, multi-product transactions reflect internal allocations and are therefore subject to certain assumptions and to the Company’s methodology.
One customer, including its subsidiaries, accounted for 10.6%, 12.4%, and 12.8% of the Company’s consolidated revenue in fiscal 2021, 2020, and 2019, respectively.