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Stockholders' Equity (Tables)
 12 Months Ended
Jul. 31, 2011
Equity [Abstract]  
Total share-based compensation expense
The following table summarizes the total share-based compensation expense that we recorded for the periods shown.


 
Twelve Months Ended July 31,
(In millions except per share amounts)
2011
 
2010
 
2009
 
 
 
 
 
 
Cost of product revenue
$
1


 
$
1


 
$
2


Cost of service and other revenue
6


 
7


 
7


Selling and marketing
46


 
41


 
45


Research and development
51


 
41


 
39


General and administrative
49


 
44


 
37


Discontinued operations
—


 
1


 
3


Total share-based compensation expense
153


 
135


 
133


Income tax benefit
(53
)
 
(48
)
 
(48
)
Decrease in net income
$
100


 
$
87


 
$
85


 
 
 
 
 
 
Decrease in net income per share:
 
 
 
 
 
Basic
$
0.33


 
$
0.28


 
$
0.26


Diluted
$
0.32


 
$
0.27


 
$
0.26
Assumptions used to estimate the fair value of stock options granted and shares purchased under Employee Stock Purchase Plan
We used the following assumptions to estimate the fair value of stock options granted and shares purchased under our Employee Stock Purchase Plan for the periods indicated:


 
Twelve Months Ended July 31,
 
2011
 
2010
 
2009
Assumptions for stock options:
 
 
 
 
 
Expected volatility (range)
27% - 30%


 
24% - 30%


 
28% - 44%


Weighted average expected volatility
28
%
 
28
%
 
31
%
Risk-free interest rate (range)
0.87% - 1.91%


 
1.37% - 2.82%


 
1.13% - 3.08%


Expected dividend yield (1)
0% - 1.20%


 
0
%
 
0
%
 
 
 
 
 
 
Assumptions for ESPP:
 
 
 
 
 
Expected volatility (range)
27% - 33%


 
22% - 29%


 
35% - 53%


Weighted average expected volatility
29
%
 
26
%
 
42
%
Risk-free interest rate (range)
0.05% - 0.16%


 
0.04% - 0.16%


 
0.04% - 0.84%


Expected dividend yield
0
%
 
0
%
 
0
%


__________________
(1)
Expected dividend yield assumption was zero for fiscal 2011 option grants prior to July 2011. In July 2011 we determined that it was probable that we would pay cash dividends in the future and as a result we began using an expected dividend yield assumption in our valuation models. See "Dividends on Common Stock" above for more information.
Activity under all share based compensation plans


A summary of activity under all share-based compensation plans for the fiscal periods indicated was as follows:


 
 
 
Options Outstanding
(Shares in thousands)
Shares
Available
for Grant
 
Number of
Shares
 
Weighted Average
Exercise Price
Per Share
Balance at July 31, 2008
7,976


 
50,206


 


$24.70


Additional shares authorized
10,000


 
—


 
—


Options assumed and converted in connection with acquisitions
—


 
178


 
6.45


Options granted
(6,538
)
 
6,538


 
28.83


Restricted stock units granted
(6,242
)
 
—


 
—


Options exercised
—


 
(8,760
)
 
19.37


Options canceled or expired (1)
2,208


 
(2,488
)
 
29.20


Restricted stock units forfeited (1)
682


 
—


 
—


Balance at July 31, 2009
8,086


 
45,674


 
26.00


Additional shares authorized
9,000


 
—


 
—


Options assumed and converted in connection with acquisitions
—


 
372


 
3.08


Options granted
(6,338
)
 
6,338


 
35.93


Restricted stock units granted
(5,253
)
 
—


 
—


Options exercised
—


 
(17,212
)
 
24.00


Options canceled or expired (1)
2,089


 
(2,579
)
 
29.46


Restricted stock units forfeited (1)
1,177


 
—


 
—


Balance at July 31, 2010
8,761


 
32,593


 
28.45


Additional shares authorized
31,000


 
—


 
—


Options granted
(3,055
)
 
3,055


 
47.70


Restricted stock units granted (2)
(8,501
)
 
—


 
—


Options exercised
—


 
(11,997
)
 
25.68


Options canceled or expired (1)
915


 
(972
)
 
31.44


Restricted stock units forfeited (1)(2)
1,596


 
—


 
—


Balance at July 31, 2011
30,716


 
22,679


 


$32.38




__________________
(1)
Stock options and restricted stock units canceled, expired or forfeited under our 2005 Equity Incentive Plan are returned to the pool of shares available for grant. Stock options and restricted stock units canceled, expired or forfeited under older expired plans are not returned to the pool of shares available for grant.
(2)
Under the terms of our 2005 Equity Incentive Plan as amended on January 19, 2011, RSUs granted from the pool of shares available for grant on or after November 1, 2010 reduce the pool by 2.3 shares for each share granted. RSUs forfeited and returned to the pool of shares available for grant increase the pool by 2.3 shares for each share forfeited.
Options outstanding exercisable and expected to vest and exercisable
Options outstanding, exercisable and expected to vest, and exercisable as of July 31, 2011 were as follows:


 
Number
of Shares
(in thousands)
 
Weighted
Average
Remaining
Contractual
Life
(in Years)    
 
Weighted
Average
Exercise
Price per
Share      
 
Aggregate
Intrinsic
Value
(in millions)    
Options outstanding
22,679


 
4.39


 


$32.38


 


$329


Options exercisable and expected to vest
22,118


 
4.34


 


$32.12


 


$322


Options exercisable
14,271


 
3.45


 


$28.69


 


$257
Additional Information Regarding Stock Options Restricted Stock and Espp [Table Text Block]
Additional information regarding our stock options, restricted stock and ESPP shares is shown in the table below.


 
Twelve Months Ended July 31,
(In millions except per share amounts)
2011
 
2010
 
2009
 
 
 
 
 
 
Weighted average fair value of options granted (per share)
$
10.44


 
$
8.73


 
$
7.86


Total fair value of options vested
$
53


 
$
57


 
$
58


 
 
 
 
 
 
Aggregate intrinsic value of options exercised
$
261


 
$
157


 
$
79


 
 
 
 
 
 
Share-based compensation expense for stock options, restricted stock and ESPP
$
53


 
$
67


 
$
63


Total tax benefit for stock option, restricted stock and ESPP share-based compensation
$
17


 
$
24


 
$
22


 
 
 
 
 
 
Cash received from option exercises
$
308


 
$
413


 
$
169


Cash tax benefits realized related to tax deductions for non-qualified option exercises and disqualifying dispositions under all share-based payment arrangements
$
99


 
$
61


 
$
32
Summary of restricted stock unit activity
A summary of restricted stock unit (RSU) activity for the periods indicated was as follows:


(Shares in thousands)
Number
of Shares
 
Weighted
Average
Grant Date
Fair Value
Nonvested at July 31, 2008
4,997


 


$29.29


Granted
6,242


 
26.09


Vested
(1,150
)
 
30.54


Forfeited
(691
)
 
28.53


Nonvested at July 31, 2009
9,398


 
27.06


Granted
5,253


 
36.24


Restricted stock units assumed and converted in connection with acquisitions
231


 
29.14


Vested
(2,172
)
 
29.30


Forfeited
(1,179
)
 
26.46


Nonvested at July 31, 2010
11,531


 
30.93


Granted
3,855


 
47.02


Vested
(3,474
)
 
26.33


Forfeited
(857
)
 
31.73


Nonvested at July 31, 2011
11,055


 
$
37.92
Additional information regarding restricted stock units
Additional information regarding our RSUs is shown in the table below.


 
Twelve Months Ended July 31,
(In millions)
2011
 
2010
 
2009
 
 
 
 
 
 
Total fair value of RSUs vested
$
150


 
$
64


 
$
35


 
 
 
 
 
 
Share-based compensation for RSUs
$
100


 
$
68


 
$
70


Total tax benefit related to RSU share-based compensation expense
$
36


 
$
25


 
$
26


 
 
 
 
 
 
Cash tax benefits realized for tax deductions for RSUs
$
36


 
$
24


 
$
14