ARUBA NETWORKS, INC. - 10-Q filing on 2015-03-10

Condensed Consolidated Balance Sheet Components

6 Months Ended

Jan. 31, 2015

Condensed Consolidated Balance Sheet Components

The following tables summarize selected components of the Company's Condensed Consolidated Balance Sheets:



	January 31, 2015		July 31, 2014
	(in thousands)
Inventory
Raw materials	$	472	$	348
Finished goods	44,801		39,488
Total	$	45,273	$	39,836



	Estimated Useful Lives	January 31, 2015			July 31, 2014
	(in thousands, except estimated useful lives)
Property and Equipment, net
Computer equipment	2 to 5 years	$	26,993		$	25,779
Computer software	2 to 5 years	19,341			16,675
Machinery and equipment	2 to 5 years	42,951			36,500
Furniture and fixtures	2 to 5 years	5,299			4,756
Leasehold improvements	1 to 6 years	10,345			8,128
Total, gross		104,929			91,838
Less: accumulated depreciation and amortization		(74,569		)	(64,577		)
Total, net		$	30,360		$	27,261

Depreciation and amortization expense for property and equipment for the second quarter of fiscal 2015 and 2014 was $4.9 million and $4.8 million, respectively. Depreciation and amortization expense for property and equipment for the first half of fiscal 2015 and 2014 was $10.0 million and $9.5 million, respectively.



	January 31, 2015		July 31, 2014
	(in thousands)
Accrued Liabilities
Compensation and benefits	$	42,946	$	37,737
Marketing	27,420		24,782
Other	24,855		18,059
Total	$	95,221	$	80,578



	January 31, 2015		July 31, 2014
	(in thousands)
Deferred Revenue
Product	$	59,525	$	50,678
Support and professional services	93,985		84,482
Total, current	153,510		135,160
Product, non-current	2,629		3,497
Support and professional services, non-current	44,596		41,480
Total, non-current	47,225		44,977
Total	$	200,735	$	180,137

Deferred product revenue relates to arrangements where not all revenue recognition criteria have been met. Deferred support and professional services revenue primarily represents customer payments made in advance for support and professional services contracts. Support contracts are typically billed on an annual basis in advance and revenue is recognized ratably over the support period, typically one to five years. Non-current product deferred revenue relates to software products sold as part of a multiple-element arrangement for which Vendor Specific Objective Evidence ("VSOE") had not been established. Revenue for these software products is recognized ratably over the related support period. The primary changes in the deferred revenue balances are due to quarter-end inventory stocking orders of our value-added distributors, growth of annual maintenance contracts from customers, and transactions which have certain acceptance or deployment provisions that will be recognized as revenue when revenue recognition criteria are met.