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ERTS 304000000 227000000 53000000 <table border="0" cellspacing="0"> <tr><td width="37%"> </td> <td width="16%"> </td> <td width="7%"> </td> <td width="3%"> </td> <td width="10%"> </td> <td width="6%"> </td> <td width="7%"> </td> <td width="3%"> </td> <td width="7%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">As of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">As of March 31, 2011</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">Amortized</td> <td align="left"> </td> <td align="right">Fair</td> <td align="left"> </td> <td align="right">Amortized</td> <td align="left"> </td> <td align="right">Fair</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Value</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Value</td></tr> <tr valign="bottom"><td align="center">Short-term investments</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Due in 1 year or less</td> <td align="left">$</td> <td align="right">221</td> <td align="left">$</td> <td align="right">222</td> <td align="left">$</td> <td align="right">214</td> <td align="left">$</td> <td style="text-indent: 4px;" align="left">214</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Due in 1-2 years</td> <td align="left"> </td> <td align="right">184</td> <td align="left"> </td> <td align="right">186</td> <td align="left"> </td> <td align="right">156</td> <td align="left"> </td> <td style="text-indent: 4px;" align="left">157</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Due in 2-3 years</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">95</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">95</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">126</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 4px;" align="left">126</td></tr> <tr><td colspan="9"> </td></tr> <tr valign="bottom"><td style="text-indent: 7px;" align="left">Short-term investments</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">500</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">503</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">496</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double; text-indent: 4px;" align="left">497</td></tr></table> 156000000 184000000 157000000 186000000 126000000 95000000 126000000 95000000 23.51 504000000 496000000 82500000 42300000 81000000 74000000 1005000000 530000000 (10) BALANCE SHEET DETAILS  Inventories   Inventories as of June 30, 2011 and March 31, 2011 consisted of (in millions): <div><a name="page_15"> </a> </div> <div align="left"> <table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="19%"> </td> <td width="9%"> </td> <td width="5%"> </td> <td width="4%"> </td> <td width="8%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Raw materials and work in process</td> <td align="left">$</td> <td align="left"> </td> <td align="right">2</td> <td align="left">$</td> <td align="right">8</td></tr> <tr valign="bottom"><td align="left">Finished goods</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">73</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">69</td></tr> <tr valign="bottom"><td align="center">Inventories</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">75</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">77</td></tr></table></div>   Property and Equipment, Net Property and equipment, net, as of June 30, 2011 and March 31, 2011 consisted of (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="49%"> </td> <td width="13%"> </td> <td width="14%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="10%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="left"> </td> <td align="center">March 31,</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Computer equipment and software</td> <td align="left">$</td> <td align="right">496</td> <td align="left"> </td> <td align="left">$</td> <td align="right">504</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Buildings</td> <td align="left"> </td> <td align="right">356</td> <td align="left"> </td> <td align="left"> </td> <td align="right">355</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Leasehold improvements</td> <td align="left"> </td> <td align="right">106</td> <td align="left"> </td> <td align="left"> </td> <td align="right">105</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Office equipment, furniture and fixtures</td> <td align="left"> </td> <td align="right">68</td> <td align="left"> </td> <td align="left"> </td> <td align="right">67</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Land</td> <td align="left"> </td> <td align="right">66</td> <td align="left"> </td> <td align="left"> </td> <td align="right">66</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Warehouse equipment and other</td> <td align="left"> </td> <td align="right">9</td> <td align="left"> </td> <td align="left"> </td> <td align="right">10</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Construction in progress</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">30</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">20</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">1,131</td> <td align="left"> </td> <td align="left"> </td> <td align="right">1,127</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Less: accumulated depreciation</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(615</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(614</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="center">Property and equipment, net</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">516</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">513</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table></div>   Depreciation expense associated with property and equipment was $25 million and $28 million for the three months ended June 30, 2011 and 2010, respectively. Acquisition-Related Restricted Cash Included in Other Current Assets and Other Assets In connection with our acquisition of Playfish in fiscal year 2010, we deposited $100 million into an escrow account to pay the former shareholders of Playfish in the event certain performance milestones through December 31, 2011 are achieved. Through the three months ended June 30, 2011, no distributions were made from the restricted cash amount. As this deposit is restricted in nature, it is excluded from cash and cash equivalents. As of June 30, 2011 and March 30, 2011 the entire amount is included in other current assets on our Condensed Consolidated Balance Sheets. Accrued and Other Current Liabilities Accrued and other current liabilities as of June 30, 2011 and March 31, 2011 consisted of (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="16%"> </td> <td width="15%"> </td> <td width="5%"> </td> <td width="9%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Other accrued expenses</td> <td align="left">$</td> <td align="right">303</td> <td align="left">$</td> <td align="right">359</td></tr> <tr valign="bottom"><td align="left">Accrued compensation and benefits</td> <td align="left"> </td> <td align="right">149</td> <td align="left"> </td> <td align="right">232</td></tr> <tr valign="bottom"><td align="left">Accrued royalties</td> <td align="left"> </td> <td align="right">78</td> <td align="left"> </td> <td align="right">96</td></tr> <tr valign="bottom"><td align="left">Deferred net revenue (other)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">74</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">81</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Accrued and other current liabilities</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">604</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">768</td></tr></table></div>   Deferred net revenue (other) includes the deferral of subscription revenue, deferrals related to our Switzerland distribution business, advertising revenue, licensing arrangements, and other revenue for which revenue recognition criteria has not been met. <div>Deferred Net Revenue (Packaged Goods and Digital Content)</div> Deferred net revenue (packaged goods and digital content) was $530 million as of June 30, 2011 and $1,005 million as of March 31, 2011. Deferred net revenue (packaged goods and digital content) includes the unrecognized revenue from (1) bundled sales of certain online-enabled packaged goods and digital content for which either we do not have vendor-specific objective evidence of fair value ("VSOE") for the online service that we provide in connection with the sale of the software or we have an obligation to provide future incremental unspecified digital content, (2) certain packaged goods sales of massively-multiplayer online role-playing games, and (3) sales of certain incremental content associated with our core subscription services that can only be played online, which are types of "micro-transactions." We recognize revenue from sales of online-enabled packaged goods and digital content for which (1) we do not have VSOE for the online service that we provided in connection with the sale and (2) we have an obligation to deliver incremental unspecified digital content in the future without an additional fee on a straight-line basis generally over an estimated six-month period beginning in the month after shipment. However, we expense the cost of goods sold related to these transactions during the period in which the product is delivered (rather than on a deferred basis). 0.1400 0.1100 0.1800 50000000 135000000 190000000 62000000 23000000 180000000 1462000000 1076000000 386000000 1102000000 701000000 401000000 <table border="0" cellspacing="0"> <tr><td width="30%"> </td> <td width="10%"> </td> <td width="12%"> </td> <td width="4%"> </td> <td width="11%"> </td> <td width="4%"> </td> <td width="12%"> </td> <td width="6%"> </td> <td width="7%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Gross</td> <td align="left"> </td> <td align="center">Gross</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">Adjusted</td> <td align="left"> </td> <td align="right">Unrealized</td> <td align="left"> </td> <td align="right">Unrealized</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Gains</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Losses</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Fair Value</td></tr> <tr valign="bottom"><td align="left">As of June 30, 2011</td> <td align="left">$</td> <td style="text-indent: 7px;" align="left">32</td> <td align="left">$</td> <td align="right">140</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">172</td></tr> <tr valign="bottom"><td align="left">As of March 31, 2011</td> <td align="left">$</td> <td style="text-indent: 7px;" align="left">32</td> <td align="left">$</td> <td align="right">129</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">161</td></tr></table> 25000000 6000000 31000000 15000000 20000000 -276000000 -475000000 0.35 1100 1100 10 5000000 91000000 1 0.1100 0.25 2.00 0.00 -5000000 -5000000 109000000 594000000 -318000000 115000000 725000000 -250000000 four 50000000 2000000 18000000 (9) ROYALTIES AND LICENSES Our royalty expenses consist of payments to (1) content licensors, (2) independent software developers, and (3) co-publishing and distribution affiliates. License royalties consist of payments made to celebrities, professional sports organizations, movie studios and other organizations for our use of their trademarks, copyrights, personal publicity rights, content and/or other intellectual property. Royalty payments to independent software developers are payments for the development of intellectual property related to our games. Co-publishing and distribution royalties are payments made to third parties for the delivery of products. Royalty-based obligations with content licensors and distribution affiliates are either paid in advance and capitalized as prepaid royalties or are accrued as incurred and subsequently paid. These royalty-based obligations are generally expensed to cost of goods sold generally at the greater of the contractual rate for contracts with guaranteed minimums, or an effective royalty rate based on the total projected net revenue. Prepayments made to thinly capitalized independent software developers and co-publishing affiliates are generally made in connection with the development of a particular product and, therefore, we are generally subject to development risk prior to the release of the product. Accordingly, payments that are due prior to completion of a product are generally expensed to research and development over the development period as the services are incurred. Payments due after completion of the product (primarily royalty-based in nature) are generally expensed as cost of goods sold. Our contracts with some licensors include minimum guaranteed royalty payments, which are initially recorded as an asset and as a liability at the contractual amount when no performance remains with the licensor. When performance remains with the licensor, we record guarantee payments as an asset when actually paid and as a liability when incurred, rather than recording the asset and liability upon execution of the contract. Royalty liabilities are classified as current liabilities to the extent such royalty payments are contractually due within the next 12 months. Each quarter, we also evaluate the expected future realization of our royalty-based assets, as well as any unrecognized minimum commitments not yet paid to determine amounts we deem unlikely to be realized through product sales. Any impairments or losses determined before the launch of a product are charged to research and development expense. Impairments or losses determined post-launch are charged to cost of goods sold. We evaluate long-lived royalty-based assets for impairment generally using undiscounted cash flows when impairment indicators exist. Unrecognized minimum royalty-based commitments are accounted for as executory contracts and, therefore, any losses on these commitments are recognized when the underlying intellectual property is abandoned (i.e., cease use) or the contractual rights to use the intellectual property are terminated. During the three months ended June 30, 2011, we recognized an additional loss of $15 million representing an adjustment to our fiscal 2011 restructuring. During the three months ended June 30, 2010, we recognized a loss of $10 million on previously unrecognized royalty-based commitments. We did not recognize any impairment charges during the three months ended June 30, 2011 and 2010 related to our royalty-based assets. The current and long-term portions of prepaid royalties and minimum guaranteed royalty-related assets, included in other current assets and other assets, consisted of (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="46%"> </td> <td width="16%"> </td> <td width="19%"> </td> <td width="6%"> </td> <td width="12%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Other current assets</td> <td align="left">$</td> <td style="text-indent: 9px;" align="left">105</td> <td align="left">$</td> <td align="right">89</td></tr> <tr valign="bottom"><td align="left">Other assets</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 9px;" align="left">119</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">22</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Royalty-related assets</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double; text-indent: 9px;" align="left">224</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">111</td></tr></table></div>   At any given time, depending on the timing of our payments to our co-publishing and/or distribution affiliates, content licensors and/or independent software developers, we recognize unpaid royalty amounts owed to these parties as accrued liabilities. The current and long-term portions of accrued royalties, included in accrued and other current liabilities and other liabilities, consisted of (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="9%"> </td> <td width="19%"> </td> <td width="6%"> </td> <td width="12%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Accrued and other current liabilities</td> <td align="left">$</td> <td align="right">116</td> <td align="left">$</td> <td align="right">136</td></tr> <tr valign="bottom"><td align="left">Other liabilities</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">71</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">61</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Royalty-related liabilities</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">187</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">197</td></tr></table></div>   As of June 30, 2011, $109 million of restructuring accruals related to the fiscal 2011 restructuring plan is included in royalty-related liabilities in the table above. See Note 8 for details of restructuring and other restructuring plan-related activities and Note 10 for the details of our accrued and other current liabilities. In addition, as of June 30, 2011, we were committed to pay approximately $1,000 million to content licensors, independent software developers and co-publishing and/or distribution affiliates, but performance remained with the counterparty (i.e., delivery of the product or content or other factors) and such commitments were therefore not recorded in our Condensed Consolidated Financial Statements. 111000000 89000000 22000000 224000000 105000000 119000000 10000000 15000000 <table border="0" cellspacing="0"> <tr><td width="47%"> </td> <td width="24%"> </td> <td width="6%"> </td> <td width="16%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td colspan="3" align="right">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 6px;" colspan="3" align="left">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Risk-free interest rate</td> <td align="right">1.0- 1.8</td> <td align="left">%</td> <td align="right">1.2- 2.4</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected volatility</td> <td align="right">40- 41</td> <td align="left">%</td> <td align="right">41- 44</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Weighted-average volatility</td> <td align="right">40</td> <td align="left">%</td> <td align="right">43</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected term</td> <td align="right">4.4years</td> <td align="left"> </td> <td align="right">4.4years</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Expected dividends</td> <td align="right">None</td> <td align="left"> </td> <td align="right">None</td> <td align="left"> </td></tr></table> <table border="0" cellspacing="0"> <tr><td width="51%"> </td> <td width="41%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Risk-free interest rate</td> <td align="right">0.2- 0.6</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected volatility</td> <td align="right">14- 83</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Weighted-average volatility</td> <td class="MetaData" align="right">35</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected dividends</td> <td align="center">None</td> <td align="left"> </td></tr></table> <table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="12%"> </td> <td width="15%"> </td> <td width="6%"> </td> <td width="12%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="right">Three Months Ended</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td></tr> <tr valign="bottom"><td align="left">Consoles</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Xbox 360</td> <td align="left">$</td> <td align="right">345</td> <td align="right">$</td> <td align="right">262</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">PLAYSTATION 3</td> <td align="left"> </td> <td align="right">308</td> <td align="left"> </td> <td align="right">209</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Wii</td> <td align="left"> </td> <td align="right">42</td> <td align="left"> </td> <td align="right">40</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">PlayStation 2</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">3</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">11</td></tr> <tr valign="bottom"><td style="text-indent: 6px;" align="left">Total consoles</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">698</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">522</td></tr> <tr><td colspan="5"> </td></tr> <tr valign="bottom"><td align="left">PC</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">205</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">186</td></tr> <tr valign="bottom"><td align="left">Mobile and handhelds</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Mobile</td> <td align="left"> </td> <td align="right">57</td> <td align="left"> </td> <td align="right">52</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">PSP</td> <td align="left"> </td> <td align="right">11</td> <td align="left"> </td> <td align="right">19</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Nintendo DS</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">8</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">11</td></tr> <tr valign="bottom"><td style="text-indent: 6px;" align="left">Total mobile and handhelds</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">76</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">82</td></tr> <tr><td colspan="5"> </td></tr> <tr valign="bottom"><td align="left">Other</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">20</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">25</td></tr> <tr valign="bottom"><td align="left">Total net revenue</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">999</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">815</td></tr></table> <table border="0" cellspacing="0"> <tr><td width="46%"> </td> <td width="16%"> </td> <td width="19%"> </td> <td width="6%"> </td> <td width="12%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Other current assets</td> <td align="left">$</td> <td style="text-indent: 9px;" align="left">105</td> <td align="left">$</td> <td align="right">89</td></tr> <tr valign="bottom"><td align="left">Other assets</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 9px;" align="left">119</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">22</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Royalty-related assets</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double; text-indent: 9px;" align="left">224</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">111</td></tr></table> <table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="9%"> </td> <td width="19%"> </td> <td width="6%"> </td> <td width="12%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Accrued and other current liabilities</td> <td align="left">$</td> <td align="right">116</td> <td align="left">$</td> <td align="right">136</td></tr> <tr valign="bottom"><td align="left">Other liabilities</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">71</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">61</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Royalty-related liabilities</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">187</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">197</td></tr></table> 10000000 3500000 4000000 -89000000 13000000 125000000 19900000 40000000 137000000 84000000 20000000 33000000 289000000 198000000 50000000 38000000 3000000 281000000 138000000 35000000 98000000 10000000 457000000 348000000 14000000 95000000 169000000 106000000 29000000 32000000 2000000 240000000 126000000 43000000 68000000 3000000 23.01 29.95

<table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="16%"> </td> <td width="15%"> </td> <td width="5%"> </td> <td width="9%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Other accrued expenses</td> <td align="left">$</td> <td align="right">303</td> <td align="left">$</td> <td align="right">359</td></tr> <tr valign="bottom"><td align="left">Accrued compensation and benefits</td> <td align="left"> </td> <td align="right">149</td> <td align="left"> </td> <td align="right">232</td></tr> <tr valign="bottom"><td align="left">Accrued royalties</td> <td align="left"> </td> <td align="right">78</td> <td align="left"> </td> <td align="right">96</td></tr> <tr valign="bottom"><td align="left">Deferred net revenue (other)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">74</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">81</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Accrued and other current liabilities</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">604</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">768</td></tr></table>

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(4) FINANCIAL INSTRUMENTS  Cash and Cash Equivalents As of June 30, 2011 and March 31, 2011, our cash and cash equivalents were $1,173 million and $1,579 million, respectively. Cash equivalents were valued at their carrying amounts as they approximate fair value due to the short maturities of these financial instruments. Short-Term Investments Short-term investments consisted of the following as of June 30, 2011 and March 31, 2011 (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="24%"> </td> <td width="6%"> </td> <td width="6%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="8%"> </td> <td width="2%"> </td> <td width="6%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">As of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="center">As of March 31, 2011</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">Cost or</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Cost or</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">Amortized</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">Gross Unrealized</td> <td align="right"> </td> <td align="center">Fair</td> <td align="left"> </td> <td align="right">Amortized</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">Gross Unrealized</td> <td align="right"> </td> <td align="center">Fair</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Gains</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Losses</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double; text-indent: 1px;" align="left">Value</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Gains</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Losses</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double; text-indent: 1px;" align="left">Value</td></tr> <tr valign="bottom"><td align="left">Corporate bonds</td> <td align="left">$</td> <td align="right">241</td> <td style="text-indent: 2px;" align="left">$</td> <td align="right">1</td> <td align="left">$</td> <td align="right">-</td> <td align="right">$</td> <td align="right">242</td> <td align="left">$</td> <td align="right">252</td> <td style="text-indent: 3px;" align="left">$</td> <td align="right">1</td> <td align="left">$</td> <td align="right">-</td> <td align="right">$</td> <td align="right">253</td></tr> <tr valign="bottom"><td align="left">U.S. Treasury securities</td> <td align="left"> </td> <td align="right">117</td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">118</td> <td align="left"> </td> <td align="right">124</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">124</td></tr> <tr valign="bottom"><td align="left">U.S. agency securities</td> <td align="left"> </td> <td align="right">117</td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">118</td> <td align="left"> </td> <td align="right">102</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">102</td></tr> <tr valign="bottom"><td align="left">Commercial paper</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">25</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">25</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">18</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">18</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Short-term investments</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">500</td> <td style="border-bottom: #000000 3px double; text-indent: 2px;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">3</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">503</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">496</td> <td style="border-bottom: #000000 3px double; text-indent: 3px;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">497</td></tr></table></div>   We evaluate our investments for impairment quarterly. Factors considered in the review of investments with an unrealized loss include the credit quality of the issuer, the duration that the fair value has been less than the adjusted cost basis, severity of the impairment, reason for the decline in value and potential recovery period, the financial condition and near-term prospects of the investees, our intent to sell the investments, any contractual terms impacting the prepayment or settlement process, as well as if we would be required to sell an investment due to liquidity or contractual reasons before its anticipated recovery. Based on our review, we did not consider these investments to be other-than-temporarily impaired as of June 30, 2011 and March 31, 2011. The following table summarizes the amortized cost and fair value of our short-term investments, classified by stated maturity as of June 30, 2011 and March 31, 2011 (in millions):     <div><a name="page_9"> </a> </div> <div align="left"> <table border="0" cellspacing="0"> <tr><td width="37%"> </td> <td width="16%"> </td> <td width="7%"> </td> <td width="3%"> </td> <td width="10%"> </td> <td width="6%"> </td> <td width="7%"> </td> <td width="3%"> </td> <td width="7%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">As of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">As of March 31, 2011</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">Amortized</td> <td align="left"> </td> <td align="right">Fair</td> <td align="left"> </td> <td align="right">Amortized</td> <td align="left"> </td> <td align="right">Fair</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Value</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Value</td></tr> <tr valign="bottom"><td align="center">Short-term investments</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Due in 1 year or less</td> <td align="left">$</td> <td align="right">221</td> <td align="left">$</td> <td align="right">222</td> <td align="left">$</td> <td align="right">214</td> <td align="left">$</td> <td style="text-indent: 4px;" align="left">214</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Due in 1-2 years</td> <td align="left"> </td> <td align="right">184</td> <td align="left"> </td> <td align="right">186</td> <td align="left"> </td> <td align="right">156</td> <td align="left"> </td> <td style="text-indent: 4px;" align="left">157</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Due in 2-3 years</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">95</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">95</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">126</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 4px;" align="left">126</td></tr> <tr><td colspan="9"> </td></tr> <tr valign="bottom"><td style="text-indent: 7px;" align="left">Short-term investments</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">500</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">503</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">496</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double; text-indent: 4px;" align="left">497</td></tr></table></div>   Marketable Equity Securities Our investments in marketable equity securities consist of investments in common stock of publicly traded companies and are accounted for as available-for-sale securities and are recorded at fair value. Unrealized gains and losses are recorded as a component of accumulated other comprehensive income in stockholders' equity, net of tax, until either the security is sold or we determine that the decline in the fair value of a security to a level below its adjusted cost basis is other-than-temporary. We evaluate these investments for impairment quarterly. If we conclude that an investment is other-than-temporarily impaired, we will recognize an impairment charge at that time in our Condensed Consolidated Statements of Operations. Marketable equity securities consisted of the following as of June 30, 2011 and March 31, 2011 (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="30%"> </td> <td width="10%"> </td> <td width="12%"> </td> <td width="4%"> </td> <td width="11%"> </td> <td width="4%"> </td> <td width="12%"> </td> <td width="6%"> </td> <td width="7%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Gross</td> <td align="left"> </td> <td align="center">Gross</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">Adjusted</td> <td align="left"> </td> <td align="right">Unrealized</td> <td align="left"> </td> <td align="right">Unrealized</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Gains</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Losses</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Fair Value</td></tr> <tr valign="bottom"><td align="left">As of June 30, 2011</td> <td align="left">$</td> <td style="text-indent: 7px;" align="left">32</td> <td align="left">$</td> <td align="right">140</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">172</td></tr> <tr valign="bottom"><td align="left">As of March 31, 2011</td> <td align="left">$</td> <td style="text-indent: 7px;" align="left">32</td> <td align="left">$</td> <td align="right">129</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">161</td></tr></table></div>   During the three months ended June 30, 2010, we recognized an impairment charge of $2 million on our investment in The9. We did not recognize any impairment charges during the three months ended June 30, 2011 on our marketable equity securities. Due to various factors, including but not limited to, the extent and duration during which the market price of this security had been below its adjusted cost and our intent to hold this security, we concluded the decline in value was other-than-temporary. The impairment charge for the three months ended June 30, 2010 is included in loss on strategic investments, in our Condensed Consolidated Statement of Operations. During the three months ended June 30, 2010, we received proceeds of $8 million and realized losses of $3 million from selling a portion of our investment in The9. We did not sell any of our marketable securities during the three months ended June 30, 2011. The realized losses for the three months ended June 30, 2010 are included in loss on strategic investments, in our Condensed Consolidated Statement of Operations.

355000000

356000000

110000000

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July 14, 2011

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392000000

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19900000

(12) COMMITMENTS AND CONTINGENCIES Lease Commitments As of June 30, 2011, we leased certain of our current facilities, furniture and equipment under non-cancelable operating lease agreements. We were required to pay property taxes, insurance and normal maintenance costs for certain of these facilities and any increases over the base year of these expenses on the remainder of our facilities. Development, Celebrity, League and Content Licenses: Payments and Commitments The products we produce in our studios are designed and created by our employee designers, artists, software programmers and by non-employee software developers ("independent artists" or "third-party developers"). We typically advance development funds to the independent artists and third-party developers during development of our games, usually in installment payments made upon the completion of specified development milestones. Contractually, these payments are generally considered advances against subsequent royalties on the sales of the products. These terms are set forth in written agreements entered into with the independent artists and third-party developers. In addition, we have certain celebrity, league and content license contracts that contain minimum guarantee payments and marketing commitments that may not be dependent on any deliverables. Celebrities and organizations with whom we have contracts include: FIFA, FIFPRO Foundation, FAPL (Football Association Premier League Limited), and DFL Deutsche Fußball Liga GmbH (German Soccer League) (professional soccer); National Basketball Association (professional basketball); PGA TOUR and Tiger Woods (professional golf); National Hockey League and NHL Players' Association (professional hockey); Warner Bros. (Harry Potter); National Football League Properties, PLAYERS Inc., and Red Bear Inc. (professional football); Collegiate Licensing Company (collegiate football); ESPN (content in EA SPORTS games); Hasbro, Inc. (most of Hasbro's toy and game intellectual properties); and LucasArts and Lucas Licensing (Star Wars: The Old Republic). These developer and content license commitments represent the sum of (1) the cash payments due under non-royalty-bearing licenses and services agreements and (2) the minimum guaranteed payments and advances against royalties due under royalty-bearing licenses and services agreements, the majority of which are conditional upon performance by the counterparty. These minimum guarantee payments and any related marketing commitments are included in the table below. The following table summarizes our unrecognized minimum contractual obligations as of June 30, 2011 (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="29%"> </td> <td width="7%"> </td> <td width="7%"> </td> <td width="2%"> </td> <td width="15%"> </td> <td width="5%"> </td> <td width="7%"> </td> <td width="2%"> </td> <td width="10%"> </td> <td width="3%"> </td> <td width="7%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 3px;" colspan="3" align="left">Contractual Obligations</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Developer/</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Other</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Fiscal Year</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Licensor</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Purchase</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 3px double;" align="left">Ending March 31,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Leases (a)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Commitments</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Marketing</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Obligations</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Total</td></tr> <tr valign="bottom"><td align="left">2012 (remaining nine months)</td> <td align="left">$</td> <td align="right">35</td> <td align="left">$</td> <td align="right">138</td> <td align="left">$</td> <td align="right">98</td> <td align="left">$</td> <td align="right">10</td> <td align="left">$</td> <td align="right">281</td></tr> <tr valign="bottom"><td align="left">2013</td> <td align="left"> </td> <td align="right">50</td> <td align="left"> </td> <td align="right">198</td> <td align="left"> </td> <td align="right">38</td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td> <td align="right">289</td></tr> <tr valign="bottom"><td align="left">2014</td> <td align="left"> </td> <td align="right">43</td> <td align="left"> </td> <td align="right">126</td> <td align="left"> </td> <td align="right">68</td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td> <td align="right">240</td></tr> <tr valign="bottom"><td align="left">2015</td> <td align="left"> </td> <td align="right">29</td> <td align="left"> </td> <td align="right">106</td> <td align="left"> </td> <td align="right">32</td> <td align="left"> </td> <td align="right">2</td> <td align="left"> </td> <td align="right">169</td></tr> <tr valign="bottom"><td align="left">2016</td> <td align="left"> </td> <td align="right">20</td> <td align="left"> </td> <td align="right">84</td> <td align="left"> </td> <td align="right">33</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">137</td></tr> <tr valign="bottom"><td align="left">Thereafter</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">14</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">348</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">95</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">457</td></tr> <tr valign="bottom"><td align="left">Total</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">191</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,000</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">364</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">18</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,573</td></tr></table></div>   (a) Lease commitments have not been reduced by minimum sub-lease rentals for unutilized office space resulting from our reorganization activities of approximately $11 million due in the future under non-cancelable sub-leases. The amounts represented in the table above reflect our unrecognized minimum cash obligations for the respective fiscal years, but do not necessarily represent the periods in which they will be recognized and expensed in our Condensed Consolidated Financial Statements. In addition, the amounts in the table above are presented based on the dates the amounts are contractually due; however, certain payment obligations may be accelerated depending on the performance of our operating results. In addition to what is included in the table above, as of June 30, 2011, we had a liability for unrecognized tax benefits and an accrual for the payment of related interest totaling $240 million, of which approximately $40 million is offset by prior cash deposits to tax authorities for issues pending resolution. For the remaining liability, we are unable to make a reasonably reliable estimate of when cash settlement with a taxing authority will occur. In addition to what is included in the table above as of June 30, 2011, in connection with our acquisitions, we may be required to pay an additional $110 million of cash consideration through March 31, 2014, that is contingent upon the achievement of certain performance milestones. As of June 30, 2011, we have accrued $53 million of contingent consideration on our Condensed Consolidated Balance Sheet. Legal Proceedings We are subject to claims and litigation arising in the ordinary course of business. We do not believe that any liability from any reasonably foreseeable disposition of such claims and litigation, individually or in the aggregate, would have a material adverse effect on our Condensed Consolidated Financial Statements.

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<h1 style="margin: 0in 0in 0pt; font-family: 'Times New Roman','serif'; font-size: 12pt; font-weight: normal;">(14) COMPREHENSIVE INCOME (LOSS)</h1> We classify items of other comprehensive income (loss) by their nature in a financial statement and display the accumulated other comprehensive income balance separately from retained earnings (accumulated deficit) and paid-in capital in the equity section of our balance sheets. Accumulated other comprehensive income primarily includes foreign currency translation adjustments and the net of tax amounts for unrealized gains (losses) on available-for-sale securities and derivative instruments designated as cash flow hedges. Foreign currency translation adjustments are not adjusted for income taxes as they relate to indefinite investments in non-U.S. subsidiaries. The change in the components of comprehensive income (loss), net of related immaterial taxes, for the three months ended June 30, 2011 and 2010 is summarized as follows (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="70%"> </td> <td width="5%"> </td> <td width="9%"> </td> <td width="3%"> </td> <td width="7%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="center">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Net income</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">221</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">96</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Other comprehensive income (loss):</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Change in unrealized gains (losses) on available-for-sale securities</td> <td align="left"> </td> <td align="right">13</td> <td align="left"> </td> <td align="right">(89</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Reclassification adjustment for realized losses on available-for-sale securities</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">5</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Change in unrealized gains on derivative instruments</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">(1</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Reclassification adjustment for realized losses on derivative instruments</td> <td align="left"> </td> <td align="right">2</td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Foreign currency translation adjustments</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">6</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(31</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr><td colspan="6"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Total other comprehensive income (loss)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">21</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(115</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr><td colspan="6"> </td></tr> <tr valign="bottom"><td align="left">Total comprehensive income (loss)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">242</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">(19</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr></table></div>

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550000000

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31.5075

1000

0.0075

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56000000

58000000

49000000

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42000000

28000000

25000000

48000000

43000000

11000000

35000000

11000000

30000000

(17) IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS   <a name="Text_newacctgstandards">In May 2011, the FASB issued ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. The amendments in this ASU generally represent clarification of Topic 820, but also include instances where a particular principle or requirement for measuring fair value or disclosing information about fair value measurements has changed. This update results in common principles and requirements for measuring fair value and for disclosing information about fair value measurements in accordance with U.S. Generally Accepted Accounting Principles and International Financial Reporting Standards. The amendments are effective for interim and annual periods beginning after December 15, 2011 and are to be applied prospectively. We do not expect the adoption of ASU 2011-04 to have a material impact on our Condensed Consolidated Financial Statements. </a>   In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 requires one of two alternatives for presenting comprehensive income and eliminates the option to report other comprehensive income and its components as a part of the Consolidated Statements of Stockholders' Equity. ASU 2011-05 also requires presentation on the face of the financial statements reclassification adjustments for items that are reclassified from other comprehensive income to net income in the statement(s) where the components of net income and the components of other comprehensive income are presented. The amendments in ASU 2011-05 do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. ASU 2011-05 is effective for fiscal years and interim periods within those years beginning after December 15, 2011 and is to be applied retrospectively. We do not expect the adoption of ASU 2011-05 to have a material impact on our Condensed Consolidated Financial Statements.

(13) STOCK-BASED COMPENSATION <div>   Valuation Assumptions   We are required to estimate the fair value of share-based payment awards on the date of grant. We recognize compensation costs for stock-based payment awards to employees based on the grant-date fair value using a straight-line approach over the service period for which such awards are expected to vest.   We determine the fair value of our share-based payment awards as follows:   <ul style="margin-top: 0in; margin-bottom: 0in;" type="disc"> <li style="margin: 0in 0in 0pt; font-family: 'Times New Roman','serif'; font-size: 10pt;" class="MsoNormal">Restricted Stock Units, Restricted Stock, and Performance-Based Restricted Stock Units.  The fair value of restricted stock units, restricted stock, and performance-based restricted stock units (other than market-based restricted stock units) is determined based on the quoted market price of our common stock on the date of grant. Performance-based restricted stock units include grants made (1) to certain members of executive management primarily granted in fiscal year 2008 and (2) in connection with certain acquisitions.</li></ul>   <ul style="margin-top: 0in; margin-bottom: 0in;" type="disc"> <li style="margin: 0in 0in 0pt; font-family: 'Times New Roman','serif'; font-size: 10pt;" class="MsoNormal">Market-Based Restricted Stock Units.  Market-based restricted stock units consist of grants of performance-based restricted stock units granted during the three months ended June 30, 2011 to certain members of executive management (referred to herein as "market-based restricted stock units"). The fair value of our market-based restricted stock units is determined using a Monte-Carlo simulation model. Key assumptions for the Monte-Carlo simulation model are the risk-free interest rate, expected volatility, expected dividends and correlation coefficient. </li></ul>   <ul style="margin-top: 0in; margin-bottom: 0in;" type="disc"> <li style="margin: 0in 0in 0pt; font-family: 'Times New Roman','serif'; font-size: 10pt;" class="MsoNormal">Stock Options and Employee Stock Purchase Plan.  The fair value of stock options and stock purchase rights granted pursuant to our equity incentive plans and our 2000 Employee Stock Purchase Plan ("ESPP"), respectively is determined using the Black-Scholes valuation model based on the multiple-award valuation method. Key assumptions of the Black-Scholes valuation model are the risk-free interest rate, expected volatility, expected term and expected dividends.</li></ul>   The determination of the fair value of market-based restricted stock units, stock options and ESPP is affected by assumptions regarding subjective and complex variables. Generally, our assumptions are based on historical information and judgment is required to determine if historical trends may be indicators of future outcomes.   The estimated assumptions used in the Black-Scholes valuation model to value our stock option grants were as follows:</div> <div align="left"> <table border="0" cellspacing="0"> <tr><td width="47%"> </td> <td width="24%"> </td> <td width="6%"> </td> <td width="16%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td colspan="3" align="right">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 6px;" colspan="3" align="left">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Risk-free interest rate</td> <td align="right">1.0- 1.8</td> <td align="left">%</td> <td align="right">1.2- 2.4</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected volatility</td> <td align="right">40- 41</td> <td align="left">%</td> <td align="right">41- 44</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Weighted-average volatility</td> <td align="right">40</td> <td align="left">%</td> <td align="right">43</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected term</td> <td align="right">4.4years</td> <td align="left"> </td> <td align="right">4.4years</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Expected dividends</td> <td align="right">None</td> <td align="left"> </td> <td align="right">None</td> <td align="left"> </td></tr></table></div>   The estimated assumptions used in the Monte-Carlo simulation model to value our market-based restricted stock units were as follows: <div align="left"> <table border="0" cellspacing="0"> <tr><td width="51%"> </td> <td width="41%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Risk-free interest rate</td> <td align="right">0.2- 0.6</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected volatility</td> <td align="right">14- 83</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Weighted-average volatility</td> <td class="MetaData" align="right">35</td> <td align="left">%</td></tr> <tr valign="bottom"><td align="left">Expected dividends</td> <td align="center">None</td> <td align="left"> </td></tr></table></div>   There were no market-based restricted stock units valued during the three months ended June 30, 2010 and no ESPP shares valued during the three months ended June 30, 2011 and 2010. Stock-Based Compensation Expense Employee stock-based compensation expense recognized during the three months ended June 30, 2011 and 2010 was calculated based on awards ultimately expected to vest and has been reduced for estimated forfeitures. In subsequent periods, if actual forfeitures differ from those estimates, an adjustment to stock-based compensation expense will be recognized at that time. The following table summarizes stock-based compensation expense resulting from stock options, restricted stock, restricted stock units and the ESPP included in our Condensed Consolidated Statements of Operations (in millions): <div> </div><a name="page_20"> </a> <div align="left"> <table border="0" cellspacing="0"> <tr><td width="56%"> </td> <td width="11%"> </td> <td width="8%"> </td> <td width="6%"> </td> <td width="13%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="left">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Cost of goods sold</td> <td align="left">$</td> <td align="left"> </td> <td align="right">1</td> <td align="right">$</td> <td align="right">1</td></tr> <tr valign="bottom"><td align="left">Marketing and sales</td> <td align="left"> </td> <td align="left"> </td> <td align="right">5</td> <td align="left"> </td> <td align="right">4</td></tr> <tr valign="bottom"><td align="left">General and administrative</td> <td align="left"> </td> <td align="left"> </td> <td align="right">9</td> <td align="left"> </td> <td align="right">12</td></tr> <tr valign="bottom"><td align="left">Research and development</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">23</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">30</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Stock-based compensation expense</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">38</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">47</td></tr></table></div>     During the three months ended June 30, 2011 and 2010, we did not recognize any provision for or benefit from income taxes related to our stock-based compensation expense. As of June 30, 2011, our total unrecognized compensation cost related to stock options was $28 million and is expected to be recognized over a weighted-average service period of 1.2 years. As of June 30, 2011, our total unrecognized compensation cost related to restricted stock, restricted stock units and notes payable in shares of common stock (collectively referred to as "restricted stock rights") was $388 million and is expected to be recognized over a weighted-average service period of 2.2 years. Of the $388 million of unrecognized compensation cost above, $24 million relates to performance-based restricted stock units for which we ceased recognizing stock-based compensation expense during fiscal year 2010 because we determined that the performance attainment was neither probable nor improbable of achievement. Stock Options The following table summarizes our stock option activity for the three months ended June 30, 2011: <div align="left"> <table border="0" cellspacing="0"> <tr><td width="32%"> </td> <td width="18%"> </td> <td width="3%"> </td> <td width="2%"> </td> <td width="11%"> </td> <td width="17%"> </td> <td width="2%"> </td> <td width="11%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Average</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td> <td align="center">Remaining</td> <td align="left"> </td> <td align="center">Aggregate</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Options</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Average</td> <td align="center">Contractual Term</td> <td align="left"> </td> <td align="right">Intrinsic Value</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(in thousands)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Exercise Price</td> <td style="border-bottom: #000000 3px double;" align="center">(in years)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(in millions)</td></tr> <tr valign="bottom"><td align="left">Outstanding as of March 31, 2011</td> <td align="right">12,899</td> <td align="left"> </td> <td align="left">$</td> <td style="text-indent: 7px;" align="left">31.39</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Granted</td> <td align="right">105</td> <td align="left"> </td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">22.19</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Exercised</td> <td align="right">(711</td> <td align="left">)</td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">19.86</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Forfeited, cancelled or expired</td> <td style="border-bottom: #000000 3px double;" align="right">(698</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">23.38</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Outstanding as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">11,595</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">32.50</td> <td align="right">5.02</td> <td align="left">$</td> <td align="right">29</td></tr> <tr valign="bottom"><td align="left">Exercisable as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">8,776</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">35.68</td> <td align="right">4.20</td> <td align="left">$</td> <td align="right">15</td></tr></table></div>   The aggregate intrinsic value represents the total pre-tax intrinsic value based on our closing stock price as of June 30, 2011, which would have been received by the option holders had all the option holders exercised their options as of that date. The weighted-average grant date fair values of stock options granted during the three months ended June 30, 2011 and 2010 were $7.70 and $6.46, respectively. We issue new common stock from our authorized shares upon the exercise of stock options. Restricted Stock Rights The following table summarizes our restricted stock rights activity, excluding performance-based and market-based restricted stock unit activity discussed below, for the three months ended June 30, 2011: <div align="left"> <table border="0" cellspacing="0"> <tr><td width="45%"> </td> <td width="33%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="13%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="right">Restricted Stock</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Rights</td> <td align="left"> </td> <td align="left"> </td> <td align="right">Average Grant</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(in thousands)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Date Fair Value</td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="right">13,971</td> <td align="left"> </td> <td style="text-indent: 1px;" align="left">$</td> <td align="right">22.01</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Granted</td> <td align="right">6,995</td> <td align="left"> </td> <td align="left"> </td> <td align="right">22.35</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Vested</td> <td align="right">(2,370</td> <td align="left">)</td> <td align="left"> </td> <td align="right">22.43</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Forfeited or cancelled</td> <td style="border-bottom: #000000 3px double;" align="right">(664</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td> <td align="right">19.91</td></tr> <tr valign="bottom"><td align="left">Balance as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">17,932</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td align="right">22.16</td></tr></table></div>   <div> </div><a name="page_21"> </a> The weighted-average grant date fair values of restricted stock rights granted during the three months ended June 30, 2011 and 2010 were $22.35 and $17.65, respectively. Performance-Based Restricted Stock Units The following table summarizes our performance-based restricted stock unit activity for the three months ended June 30, 2011: <div align="left"> <table border="0" cellspacing="0"> <tr><td width="45%"> </td> <td width="33%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="13%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Performance-</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="right">Based Restricted</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Stock Units</td> <td align="left"> </td> <td align="left"> </td> <td align="right">Average Grant</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(in thousands)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Date Fair Value</td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="right">1,993</td> <td align="left"> </td> <td style="text-indent: 1px;" align="left">$</td> <td align="right">47.00</td></tr> <tr valign="bottom"><td align="center">Forfeited or cancelled</td> <td style="border-bottom: #000000 3px double;" align="right">(169</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td> <td align="right">20.01</td></tr> <tr valign="bottom"><td align="left">Balance as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">1,824</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td align="right">49.50</td></tr></table></div>   <div>   Market-Based Restricted Stock Units   During the three months ended June 30, 2011, we granted 670,000 market-based restricted stock units to certain members of executive management with a weighted average fair value of $34.77 per unit. Our market-based restricted stock units vest contingent upon the achievement of pre-determined market and service conditions. If these market conditions are not met but service conditions are met, the restricted stock units will not vest; however, any compensation expense we have recognized to date will not be reversed. The number of shares of common stock to be received at vesting will range from zero percent to 200 percent of the target number of stock units based on our total stockholder return ("TSR") relative to the performance of companies in the NASDAQ-100 Index for each measurement period over a three year period.</div> Stock Repurchase Program On February 1, 2011, our Board of Directors authorized a program to repurchase up to $600 million of our common stock over the next 18 months. The timing and actual amount of the stock repurchases will depend on several factors including price, capital availability, regulatory requirements, alternative investment opportunities and other market conditions. We are not obligated to repurchase any specific number of shares under the program and the repurchase program may be modified, suspended or discontinued at any time. During three months ended June 30, 2011, we repurchased and retired approximately 4 million shares of our common stock for approximately $91 million, net of commissions. Annual Meeting of Stockholders At our Annual Meeting of Stockholders, held on July 28, 2011, our stockholders approved (1) an amendment to our 2000 Equity Incentive Plan (the "Equity Plan") to increase the number of shares authorized for issuance under the Equity Plan by 10 million shares and (2) an amendment to the ESPP to increase the number of shares authorized under the ESPP by 3.5 million shares.

<table border="0" cellspacing="0"> <tr><td width="45%"> </td> <td width="33%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="13%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Performance-</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="right">Based Restricted</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Stock Units</td> <td align="left"> </td> <td align="left"> </td> <td align="right">Average Grant</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(in thousands)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Date Fair Value</td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="right">1,993</td> <td align="left"> </td> <td style="text-indent: 1px;" align="left">$</td> <td align="right">47.00</td></tr> <tr valign="bottom"><td align="center">Forfeited or cancelled</td> <td style="border-bottom: #000000 3px double;" align="right">(169</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td> <td align="right">20.01</td></tr> <tr valign="bottom"><td align="left">Balance as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">1,824</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td align="right">49.50</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="45%"> </td> <td width="33%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="13%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="right">Restricted Stock</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Rights</td> <td align="left"> </td> <td align="left"> </td> <td align="right">Average Grant</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(in thousands)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Date Fair Value</td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="right">13,971</td> <td align="left"> </td> <td style="text-indent: 1px;" align="left">$</td> <td align="right">22.01</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Granted</td> <td align="right">6,995</td> <td align="left"> </td> <td align="left"> </td> <td align="right">22.35</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Vested</td> <td align="right">(2,370</td> <td align="left">)</td> <td align="left"> </td> <td align="right">22.43</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Forfeited or cancelled</td> <td style="border-bottom: #000000 3px double;" align="right">(664</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td> <td align="right">19.91</td></tr> <tr valign="bottom"><td align="left">Balance as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">17,932</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td align="right">22.16</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="32%"> </td> <td width="18%"> </td> <td width="3%"> </td> <td width="2%"> </td> <td width="11%"> </td> <td width="17%"> </td> <td width="2%"> </td> <td width="11%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Average</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Weighted-</td> <td align="center">Remaining</td> <td align="left"> </td> <td align="center">Aggregate</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="center">Options</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Average</td> <td align="center">Contractual Term</td> <td align="left"> </td> <td align="right">Intrinsic Value</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(in thousands)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Exercise Price</td> <td style="border-bottom: #000000 3px double;" align="center">(in years)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(in millions)</td></tr> <tr valign="bottom"><td align="left">Outstanding as of March 31, 2011</td> <td align="right">12,899</td> <td align="left"> </td> <td align="left">$</td> <td style="text-indent: 7px;" align="left">31.39</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Granted</td> <td align="right">105</td> <td align="left"> </td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">22.19</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Exercised</td> <td align="right">(711</td> <td align="left">)</td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">19.86</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Forfeited, cancelled or expired</td> <td style="border-bottom: #000000 3px double;" align="right">(698</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">23.38</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Outstanding as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">11,595</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">32.50</td> <td align="right">5.02</td> <td align="left">$</td> <td align="right">29</td></tr> <tr valign="bottom"><td align="left">Exercisable as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right">8,776</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td> <td style="text-indent: 7px;" align="left">35.68</td> <td align="right">4.20</td> <td align="left">$</td> <td align="right">15</td></tr></table>

0.29

0.67

0.29

0.66

0.0340

0.03900

0.35

-16000000

7000000

232000000

149000000

28000000

24000000

388000000

2.2

1.2

2000000

<div align="left"> <table border="0" cellspacing="0"> <tr valign="bottom"><td style="border-bottom: #000000 3px double;" colspan="5" align="right">Fair Value Measurements at Reporting Date Using</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Quoted Prices in</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Active Markets</td> <td colspan="2" align="right">Significant</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">for Identical</td> <td align="center">Other</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Significant</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Financial</td> <td colspan="2" align="right">Observable</td> <td colspan="2" align="right">Unobservable</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Instruments</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">Inputs</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Inputs</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr><td colspan="11"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">As of March</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">31, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 1)</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">(Level 2)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 3)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 8px;" align="left">Balance Sheet Classification</td></tr> <tr valign="bottom"><td align="left">Assets</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Money market funds</td> <td align="left">$</td> <td align="right">774</td> <td align="left">$</td> <td align="right">774</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">-</td> <td align="left"> </td> <td align="left">Cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Available-for-sale securities:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Corporate bonds</td> <td align="left"> </td> <td align="right">253</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">253</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Marketable equity securities</td> <td align="left"> </td> <td align="right">161</td> <td align="left"> </td> <td align="right">161</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Marketable equity securities</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Treasury securities</td> <td align="left"> </td> <td align="right">129</td> <td align="left"> </td> <td align="right">129</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Agency securities</td> <td align="left"> </td> <td align="right">102</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">102</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Commercial paper</td> <td align="left"> </td> <td align="right">31</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">31</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Deferred compensation plan assets (a)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">12</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">12</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left">Other assets</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total assets at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,462</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,076</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">386</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Liabilities</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Contingent consideration (b)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left">Accrued and other current liabilities and other liabilities</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total liabilities at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr></table></div>   <div> (a) The deferred compensation plan assets consist of various mutual funds. (b) The contingent consideration represents the estimated fair value of the additional variable cash consideration payable in connection with our acquisitions of Playfish Limited ("Playfish") and Chillingo Limited ("Chillingo") that is contingent upon the achievement of certain performance milestones. We estimated the fair value using expected future cash flows over the period in which the obligations are expected to be settled, and applied a discount rate that appropriately captures a market participant's view of the risk associated with the obligations.</div>

<div align="left"> <table border="0" cellspacing="0"> <tr><td width="7%"> </td> <td width="6%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="33%"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 3px double;" colspan="10" align="center">Fair Value Measurements at Reporting Date Using</td></tr> <tr><td colspan="10"> <hr size="2" noshade="noshade" /> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Quoted Prices in</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Active Markets</td> <td colspan="2" align="right">Significant</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">for Identical</td> <td align="center">Other</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Significant</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Financial</td> <td colspan="2" align="right">Observable</td> <td colspan="2" align="right">Unobservable</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Instruments</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">Inputs</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Inputs</td> <td align="left"> </td></tr> <tr><td colspan="10"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">As of June</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">30, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 1)</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">(Level 2)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 3)</td> <td style="border-bottom: #000000 3px double; text-indent: 8px;" align="left">Balance Sheet Classification</td></tr> <tr valign="bottom"><td align="left">Assets</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Money market funds</td> <td align="left">$</td> <td align="right">392</td> <td align="left">$</td> <td align="right">392</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">-</td> <td align="left">Cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Available-for-sale securities:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Corporate bonds</td> <td align="left"> </td> <td align="right">242</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">242</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Marketable equity securities</td> <td align="left"> </td> <td align="right">172</td> <td align="left"> </td> <td align="right">172</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Marketable equity securities</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Agency securities</td> <td align="left"> </td> <td align="right">126</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">126</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Treasury securities</td> <td align="left"> </td> <td align="right">125</td> <td align="left"> </td> <td align="right">125</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Commercial paper</td> <td align="left"> </td> <td align="right">32</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">32</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Deferred compensation plan assets (a)</td> <td align="left"> </td> <td align="right">12</td> <td align="left"> </td> <td align="right">12</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Other assets</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Foreign currency derivatives</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td align="left">Other current assets</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total assets at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,102</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">701</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">401</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Liabilities</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Contingent consideration (b)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td align="left">Accrued and other current liabilities and other liabilities</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total liabilities at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td align="left"> </td></tr></table></div> <div> <div>   (a) The deferred compensation plan assets consist of various mutual funds. (b) The contingent consideration represents the estimated fair value of the additional variable cash consideration payable in connection with our acquisitions of Playfish Limited ("Playfish") and Chillingo Limited ("Chillingo") that is contingent upon the achievement of certain performance milestones. We estimated the fair value using expected future cash flows over the period in which the obligations are expected to be settled, and applied a discount rate that appropriately captures a market participant's view of the risk associated with the obligations.</div></div>

<table border="0" cellspacing="0"> <tr><td width="24%"> </td> <td width="6%"> </td> <td width="6%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="8%"> </td> <td width="2%"> </td> <td width="6%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">As of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="center">As of March 31, 2011</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">Cost or</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Cost or</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">Amortized</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">Gross Unrealized</td> <td align="right"> </td> <td align="center">Fair</td> <td align="left"> </td> <td align="right">Amortized</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">Gross Unrealized</td> <td align="right"> </td> <td align="center">Fair</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Gains</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Losses</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double; text-indent: 1px;" align="left">Value</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Cost</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Gains</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Losses</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double; text-indent: 1px;" align="left">Value</td></tr> <tr valign="bottom"><td align="left">Corporate bonds</td> <td align="left">$</td> <td align="right">241</td> <td style="text-indent: 2px;" align="left">$</td> <td align="right">1</td> <td align="left">$</td> <td align="right">-</td> <td align="right">$</td> <td align="right">242</td> <td align="left">$</td> <td align="right">252</td> <td style="text-indent: 3px;" align="left">$</td> <td align="right">1</td> <td align="left">$</td> <td align="right">-</td> <td align="right">$</td> <td align="right">253</td></tr> <tr valign="bottom"><td align="left">U.S. Treasury securities</td> <td align="left"> </td> <td align="right">117</td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">118</td> <td align="left"> </td> <td align="right">124</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">124</td></tr> <tr valign="bottom"><td align="left">U.S. agency securities</td> <td align="left"> </td> <td align="right">117</td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">118</td> <td align="left"> </td> <td align="right">102</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="right"> </td> <td align="right">102</td></tr> <tr valign="bottom"><td align="left">Commercial paper</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">25</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">25</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">18</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">18</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Short-term investments</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">500</td> <td style="border-bottom: #000000 3px double; text-indent: 2px;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">3</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">503</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">496</td> <td style="border-bottom: #000000 3px double; text-indent: 3px;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">497</td></tr></table>

(3) FAIR VALUE MEASUREMENTS Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining fair value, we consider the principal or most advantageous market in which we would transact and consider assumptions that market participants would use when pricing the asset or liability. We measure certain financial and nonfinancial assets and liabilities at fair value on a recurring and nonrecurring basis. Fair Value Hierarchy The three levels of inputs that may be used to measure fair value are as follows: <ul> <li>Level 1. Quoted prices in active markets for identical assets or liabilities. </li> <li>Level 2. Observable inputs other than quoted prices included within Level 1, such as quoted prices for similar assets or liabilities, quoted prices in markets with insufficient volume or infrequent transactions (less active markets), or model- derived valuations in which all significant inputs are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities. </li> <li>Level 3. Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of assets or liabilities. </li></ul> <div>Assets and Liabilities Measured at Fair Value on a Recurring Basis</div> As of June 30, 2011 and March 31, 2011, our assets and liabilities that were measured and recorded at fair value on a recurring basis were as follows (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="25%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="4%"> </td> <td width="7%"> </td> <td width="6%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="33%"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 3px double;" colspan="10" align="center">Fair Value Measurements at Reporting Date Using</td></tr> <tr><td colspan="10"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Quoted Prices in</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Active Markets</td> <td colspan="2" align="right">Significant</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">for Identical</td> <td align="center">Other</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Significant</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Financial</td> <td colspan="2" align="right">Observable</td> <td colspan="2" align="right">Unobservable</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Instruments</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">Inputs</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Inputs</td> <td align="left"> </td></tr> <tr><td colspan="10"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">As of June</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">30, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 1)</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">(Level 2)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 3)</td> <td style="border-bottom: #000000 3px double; text-indent: 8px;" align="left">Balance Sheet Classification</td></tr> <tr valign="bottom"><td align="left">Assets</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Money market funds</td> <td align="left">$</td> <td align="right">392</td> <td align="left">$</td> <td align="right">392</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">-</td> <td align="left">Cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Available-for-sale securities:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Corporate bonds</td> <td align="left"> </td> <td align="right">242</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">242</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Marketable equity securities</td> <td align="left"> </td> <td align="right">172</td> <td align="left"> </td> <td align="right">172</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Marketable equity securities</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Agency securities</td> <td align="left"> </td> <td align="right">126</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">126</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Treasury securities</td> <td align="left"> </td> <td align="right">125</td> <td align="left"> </td> <td align="right">125</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Commercial paper</td> <td align="left"> </td> <td align="right">32</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">32</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Deferred compensation plan assets (a)</td> <td align="left"> </td> <td align="right">12</td> <td align="left"> </td> <td align="right">12</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left">Other assets</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Foreign currency derivatives</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td align="left">Other current assets</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total assets at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,102</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">701</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">401</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Liabilities</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Contingent consideration (b)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td align="left">Accrued and other current liabilities and other liabilities</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total liabilities at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td align="left"> </td></tr> <tr><td colspan="10"> </td></tr> <tr valign="bottom"><td colspan="10" align="center">Fair Value Measurements Using Significant</td></tr> <tr valign="bottom"><td style="border-bottom: #000000 3px double;" colspan="10" align="center">Unobservable Inputs (Level 3)</td></tr> <tr><td colspan="10"> </td></tr> <tr><td colspan="10"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Contingent</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Consideration</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left">$</td> <td align="right">51</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Change in fair value (c)</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of June 30, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td align="left"> </td></tr></table></div>   <div align="left"> <table border="0" cellspacing="0"> <tr><td width="23%"> </td> <td width="4%"> </td> <td width="5%"> </td> <td width="4%"> </td> <td width="6%"> </td> <td width="6%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="8%"> </td> <td width="3%"> </td> <td width="31%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="5" align="right">Fair Value Measurements at Reporting Date Using</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Quoted Prices in</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">Active Markets</td> <td colspan="2" align="right">Significant</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">for Identical</td> <td align="center">Other</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Significant</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Financial</td> <td colspan="2" align="right">Observable</td> <td colspan="2" align="right">Unobservable</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Instruments</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">Inputs</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Inputs</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr><td colspan="11"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">As of March</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">31, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 1)</td> <td style="border-bottom: #000000 3px double;" colspan="2" align="center">(Level 2)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">(Level 3)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double; text-indent: 8px;" align="left">Balance Sheet Classification</td></tr> <tr valign="bottom"><td align="left">Assets</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Money market funds</td> <td align="left">$</td> <td align="right">774</td> <td align="left">$</td> <td align="right">774</td> <td align="left">$</td> <td align="right">-</td> <td align="left">$</td> <td align="right">-</td> <td align="left"> </td> <td align="left">Cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Available-for-sale securities:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Corporate bonds</td> <td align="left"> </td> <td align="right">253</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">253</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Marketable equity securities</td> <td align="left"> </td> <td align="right">161</td> <td align="left"> </td> <td align="right">161</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Marketable equity securities</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Treasury securities</td> <td align="left"> </td> <td align="right">129</td> <td align="left"> </td> <td align="right">129</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">U.S. Agency securities</td> <td align="left"> </td> <td align="right">102</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">102</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Commercial paper</td> <td align="left"> </td> <td align="right">31</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">31</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left">Short-term investments and cash equivalents</td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Deferred compensation plan assets (a)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">12</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">12</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left">Other assets</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total assets at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,462</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,076</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">386</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Liabilities</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Contingent consideration (b)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left">Accrued and other current liabilities and other liabilities</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Total liabilities at fair value</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr><td colspan="11"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td colspan="5" align="right">Fair Value Measurements Using Significant</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="5" align="right">Unobservable Inputs (Level 3)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr><td colspan="11"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Contingent</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Consideration</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2010</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left">$</td> <td align="right">65</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Additions</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Change in fair value (c)</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(17</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr></table></div>   <div><a name="page_8"> </a> </div> <div class="MetaData"> (a) The deferred compensation plan assets consist of various mutual funds.</div> (b) The contingent consideration represents the estimated fair value of the additional variable cash consideration payable in connection with our acquisitions of Playfish Limited ("Playfish") and Chillingo Limited ("Chillingo") that is contingent upon the achievement of certain performance milestones. We estimated the fair value using expected future cash flows over the period in which the obligations are expected to be settled, and applied a discount rate that appropriately captures a market participant's view of the risk associated with the obligations. (c) The change in fair value is reported as acquisition-related contingent consideration in our Condensed Consolidated Statements of Operations. Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis There were no material impairment charges for assets and liabilities measured at fair value on a nonrecurring basis in periods subsequent to initial recognition during the three months ended June 30, 2011 and 2010.

<div> <div align="left"> <table border="0" cellspacing="0"> <tr valign="bottom"><td colspan="10" align="center">Fair Value Measurements Using Significant</td></tr> <tr valign="bottom"><td style="border-bottom: #000000 3px double;" colspan="10" align="center">Unobservable Inputs (Level 3)</td></tr> <tr><td colspan="10"> <hr size="2" noshade="noshade" /> </td></tr> <tr><td colspan="10"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Contingent</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Consideration</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left">$</td> <td align="right">51</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Change in fair value (c)</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of June 30, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td align="left"> </td></tr></table></div>     <div align="left"> <table border="0" cellspacing="0"> <tr valign="bottom"><td colspan="5" align="right">Fair Value Measurements Using Significant</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="5" align="right">Unobservable Inputs (Level 3)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr><td colspan="11"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Contingent</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Consideration</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2010</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left">$</td> <td align="right">65</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Additions</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Change in fair value (c)</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(17</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Balance as of March 31, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">51</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="left"> </td></tr></table></div></div>   (c) The change in fair value is reported as acquisition-related contingent consideration in our Condensed Consolidated Statements of Operations.

-17000000

2000000

3000000

65000000

51000000

53000000

376000000

64000000

62000000

180000000

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<div>(11) INCOME TAXES</div> <div> </div> We estimate our annual effective tax rate at the end of each quarterly period, and we record the tax effect of certain discrete items, which are unusual or occur infrequently, in the interim period in which they occur, including changes in judgment about deferred tax valuation allowances. In addition, jurisdictions with a projected loss for the year, jurisdictions with a year-to-date loss where no tax benefit can be recognized, and jurisdictions where we are unable to estimate an annual effective tax rate are excluded from the estimated annual effective tax rate. The impact of such an exclusion could result in a higher or lower effective tax rate during a particular quarter depending on the mix and timing of actual earnings versus annual projections. We recognize deferred tax assets and liabilities for both the expected impact of differences between the financial statement amount and the tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax losses and tax credit carry forwards. We record a valuation allowance against deferred tax assets when it is considered more likely than not that all or a portion of our deferred tax assets will not be realized. In making this determination, we are required to give significant weight to evidence that can be objectively verified. It is generally difficult to conclude that a valuation allowance is not needed when there is significant negative evidence, such as cumulative losses in recent years. Forecasts of future taxable income are considered to be less objective than past results, particularly in light of the economic environment. Therefore, cumulative losses weigh heavily in the overall assessment. Based on the assumptions and requirements noted above, we have recorded a valuation allowance against most of our U.S. deferred tax assets. In addition, we expect to provide a valuation allowance on future U.S. tax benefits until we can sustain a level of profitability or until other significant positive evidence arises that suggest that these benefits are more likely than not to be realized. The tax provision reported for the three months ended June 30, 2011 is based on our projected annual effective tax rate for fiscal year 2012, and also includes certain discrete tax benefits recorded during the period. Our effective tax rates for the three months ended June 30, 2011 and June 30, 2010 were a tax provision of 3.9 percent and a tax benefit of 3.4 percent, respectively. The effective tax rate for the three months ended June 30, 2011 differs from the statutory rate of 35.0 percent primarily due to the utilization of U.S. deferred tax assets which were subject to a valuation allowance and non-U.S. profits subject to a reduced or zero tax rate. The effective tax rate for the three months ended June 30, 2011 differs from the same period in fiscal year 2011 primarily due to greater tax benefits recorded in fiscal year 2011 related to the expiration of statutes of limitations. During the three months ended June 30, 2011, we recorded a net increase of $5 million in gross unrecognized tax benefits. The total gross unrecognized tax benefits as of June 30, 2011 is $278 million, of which approximately $40 million would be offset by prior cash deposits to tax authorities for issues pending resolution. A portion of our unrecognized tax benefits will affect our effective tax rate if they are recognized upon favorable resolution of the uncertain tax positions. As of June 30, 2011, if recognized, approximately $139 million of the unrecognized tax benefits would affect our effective tax rate and approximately $125 million would result in adjustments to deferred tax assets with corresponding adjustments to the valuation allowance. As of June 30, 2011 the combined amount of accrued interest and penalties related to uncertain tax positions included in income tax obligations on our Condensed Consolidated Balance Sheet was approximately $24 million, as compared to the same amount at March 31, 2011. The IRS has completed its examination of our federal income tax returns through fiscal year 2005, and is currently examining our fiscal years 2006, 2007 and 2008 tax returns. We are also currently under income tax examination in Canada for fiscal years 2004 and 2005, and in France for fiscal years 2006 through 2008. We remain subject to income tax examination for several other jurisdictions including Canada for fiscal years after 2001, in France for fiscal years after 2008, in Germany for fiscal years after 2007, in the United Kingdom for fiscal years after 2009, and in Switzerland for fiscal years after 2007. On January 18, 2011, we received a Corporation Notice of Reassessment (the "Notice") from the Canada Revenue Agency ("CRA") claiming that we owe additional taxes, plus interest and penalties, for the 2004 and 2005 tax years. The incremental tax liability asserted by the CRA is $44 million, excluding interest and penalties. The Notice primarily relates to transfer pricing in connection with the reimbursement of costs for services rendered to our U.S. parent company by one of our subsidiaries in Canada. We do not agree with the CRA's position and we have filed a Notice of Objection with the appeals department of the CRA. We do not believe the CRA's position has merit and accordingly, we have not adjusted our liability for uncertain tax positions as a result of the Notice. If, upon resolution, we are required to pay an amount in excess of our liability for uncertain tax positions for this matter, the incremental amounts due would result in additional charges to income tax expense. In determining such charges, we would consider whether any correlative relief should be included in the form of additional tax deductions in the U.S should we decide to seek such relief. The timing of the resolution of income tax examinations is highly uncertain, and the amounts ultimately paid, if any, upon resolution of the issues raised by the taxing authorities may differ materially from the amounts accrued for each year. Although potential resolution of uncertain tax positions involve multiple tax periods and jurisdictions, it is reasonably possible that a reduction of up to $60 million of the reserves for unrecognized tax benefits may occur within the next 12 months, some of which, depending on the nature of the settlement or expiration of statutes of limitations, may affect our income tax provision (benefit) and therefore benefit the resulting effective tax rate. The actual amount could vary significantly depending on the ultimate timing and nature of any settlements.

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<table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="19%"> </td> <td width="9%"> </td> <td width="5%"> </td> <td width="4%"> </td> <td width="8%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="left"> </td> <td align="center">As of</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="left"> </td> <td align="right">March 31,</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">2011</td></tr> <tr valign="bottom"><td align="left">Raw materials and work in process</td> <td align="left">$</td> <td align="left"> </td> <td align="right">2</td> <td align="left">$</td> <td align="right">8</td></tr> <tr valign="bottom"><td align="left">Finished goods</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">73</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">69</td></tr> <tr valign="bottom"><td align="center">Inventories</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">75</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">77</td></tr></table>

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(1) DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION We develop, market, publish and distribute game software and content that can be played by consumers on a variety of platforms, including video game consoles (such as the Sony PLAYSTATION 3, Microsoft Xbox 360 and Nintendo Wii), personal computers, mobile phones (such as the Apple iPhone and Google Android compatible phones), tablets and electronic readers (such as the Apple iPad and Amazon Kindle), the Internet, and handheld game players (such as the Sony PlayStation Portable ("PSP") and the Nintendo DS and 3DS). Some of our games are based on content that we license from others (e.g., FIFA, Madden NFL, Harry Potter, and Hasbro's toy and game intellectual properties), and some of our games are based on our own wholly-owned intellectual property (e.g., The Sims, Need for Speed, and Dead Space). Our goal is to publish titles with global mass-market appeal, which often means translating and localizing them for sale in non-English speaking countries. In addition, we also attempt to create software game "franchises" that allow us to publish new titles on a recurring basis that are based on the same property. Examples of this franchise approach are the annual iterations of our sports-based products (e.g., FIFA, Madden NFL, and NCAA Football), wholly-owned properties that can be successfully sequeled (e.g., The Sims, Need for Speed, and Battlefield) and titles based on long-lived literary and/or movie properties (e.g., Harry Potter). Our fiscal year is reported on a 52- or 53-week period that ends on the Saturday nearest March 31. Our results of operations for the fiscal years ending or ended, as the case may be, March 31, 2012 and 2011 contain 52 weeks each and ends or ended, as the case may be, on March 31, 2012 and April 2, 2011, respectively. Our results of operations for the three months ended June 30, 2011 and 2010 contained 13 weeks each, and ended on July 2, 2011 and July 3, 2010, respectively. For simplicity of disclosure, all fiscal periods are referred to as ending on a calendar month end. The Condensed Consolidated Financial Statements are unaudited and reflect all adjustments (consisting only of normal recurring accruals unless otherwise indicated) that, in the opinion of management, are necessary for a fair presentation of the results for the interim periods presented. The preparation of these Condensed Consolidated Financial Statements requires management to make estimates and assumptions that affect the amounts reported in these Condensed Consolidated Financial Statements and accompanying notes. Actual results could differ materially from those estimates. The results of operations for the current interim periods are not necessarily indicative of results to be expected for the current year or any other period. These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2011, as filed with the United States Securities and Exchange Commission ("SEC") on May 24, 2011.

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<table border="0" cellspacing="0"> <tr><td width="49%"> </td> <td width="13%"> </td> <td width="14%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="10%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td> <td align="left"> </td> <td align="center">As of</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="center">June 30,</td> <td align="left"> </td> <td align="left"> </td> <td align="center">March 31,</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Computer equipment and software</td> <td align="left">$</td> <td align="right">496</td> <td align="left"> </td> <td align="left">$</td> <td align="right">504</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Buildings</td> <td align="left"> </td> <td align="right">356</td> <td align="left"> </td> <td align="left"> </td> <td align="right">355</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Leasehold improvements</td> <td align="left"> </td> <td align="right">106</td> <td align="left"> </td> <td align="left"> </td> <td align="right">105</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Office equipment, furniture and fixtures</td> <td align="left"> </td> <td align="right">68</td> <td align="left"> </td> <td align="left"> </td> <td align="right">67</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Land</td> <td align="left"> </td> <td align="right">66</td> <td align="left"> </td> <td align="left"> </td> <td align="right">66</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Warehouse equipment and other</td> <td align="left"> </td> <td align="right">9</td> <td align="left"> </td> <td align="left"> </td> <td align="right">10</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Construction in progress</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">30</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">20</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="right">1,131</td> <td align="left"> </td> <td align="left"> </td> <td align="right">1,127</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Less: accumulated depreciation</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(615</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(614</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="center">Property and equipment, net</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">516</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">513</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table>

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<table border="0" cellspacing="0"> <tr><td width="49%"> </td> <td width="11%"> </td> <td width="6%"> </td> <td width="6%"> </td> <td width="3%"> </td> <td width="11%"> </td> <td width="5%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td style="text-indent: 3px;" colspan="4" align="left">Three Months Ended</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Label segment:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Net revenue before revenue deferral</td> <td align="left">$</td> <td align="left"> </td> <td align="right">409</td> <td align="left"> </td> <td align="right">$</td> <td align="right">430</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Depreciation and amortization</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(11</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(11</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Other expenses</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(445</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(416</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="left">Label segment profit (loss)</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(47</td> <td align="left">)</td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td></tr> <tr><td colspan="8"> </td></tr> <tr valign="bottom"><td align="left">Reconciliation to consolidated operating income:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Other:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Revenue deferral</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(250</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(318</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Recognition of revenue deferral</td> <td align="left"> </td> <td align="left"> </td> <td align="right">725</td> <td align="left"> </td> <td align="left"> </td> <td align="right">594</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Other net revenue</td> <td align="left"> </td> <td align="left"> </td> <td align="right">115</td> <td align="left"> </td> <td align="left"> </td> <td align="right">109</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Depreciation and amortization</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(30</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(35</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Other expenses</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(286</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(255</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="left">Consolidated operating income</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">227</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">98</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table>

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(8) RESTRUCTURING AND OTHER CHARGES Restructuring and other restructuring plan-related information as of June 30, 2011 was as follows (in millions): <div><a name="page_12"> </a> </div> <div align="left"> <table border="0" cellspacing="0"> <tr><td width="17%"> </td> <td width="2%"> </td> <td width="7%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="6%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="7%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="4%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="6%"> </td> <td width="2%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Fiscal 2009</td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="4" align="right">Fiscal 2011 Restructuring</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" colspan="6" align="right">Fiscal 2010 Restructuring</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Restructuring</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td> <td colspan="2" align="right">Facilities-</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Facilities-</td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Workforce</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Other</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">Workforce</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">related</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Other</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">related</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="center">Total</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="center">Balances as of March 31, 2010</td> <td align="left">$</td> <td align="right">-</td> <td align="left"> </td> <td align="left">$</td> <td align="right">-</td> <td align="left"> </td> <td align="right">$</td> <td align="right">8</td> <td align="left"> </td> <td align="left">$</td> <td align="right">11</td> <td align="left"> </td> <td align="right">$</td> <td align="right">7</td> <td align="left"> </td> <td align="left">$</td> <td align="right">3</td> <td align="left"> </td> <td align="right">$</td> <td align="right">29</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges to operations</td> <td align="left"> </td> <td align="right">13</td> <td align="left"> </td> <td align="left"> </td> <td align="right">135</td> <td align="left"> </td> <td align="right"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">13</td> <td align="left"> </td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right"> </td> <td align="right">161</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges settled in cash</td> <td align="left"> </td> <td align="right">(8</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(32</td> <td align="left">)</td> <td align="right"> </td> <td align="right">(8</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(6</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(15</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(1</td> <td align="left">)</td> <td align="right"> </td> <td align="right">(70</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges settled in non-cash</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(2</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(2</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">(3</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="center">Balances as of March 31, 2011</td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td> <td align="left"> </td> <td align="right">101</td> <td align="left"> </td> <td align="right"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">6</td> <td align="left"> </td> <td align="left"> </td> <td align="right">5</td> <td align="left"> </td> <td align="left"> </td> <td align="right">2</td> <td align="left"> </td> <td align="right"> </td> <td align="right">117</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges to operations</td> <td align="left"> </td> <td align="right">(1</td> <td align="left">)</td> <td align="left"> </td> <td align="right">17</td> <td align="left"> </td> <td align="right"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right"> </td> <td align="right">18</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges settled in cash</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(9</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(2</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(3</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">(14</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="center">Balances as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">2</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">109</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">5</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">3</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">2</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">121</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table></div>   Fiscal 2011 Restructuring In fiscal year 2011, we announced a plan focused on the restructuring of certain licensing and developer agreements in an effort to improve the long-term profitability of our packaged goods business. Under this plan, we amended certain licensing and developer agreements. To a much lesser extent, as part of this restructuring we had workforce reductions and facilities closures through March 31, 2011. Substantially all of these exit activities were completed by March 31, 2011. As part of our fiscal 2011 restructuring plan, we amended certain license agreements to terminate certain rights we previously had to use the licensors' intellectual property. However, under these agreements we continue to be obligated to pay the contractual minimum royalty-based commitments set forth in the original agreements. Accordingly, we recognized losses and impairments of $119 million representing (1) the net present value of the estimated payments related to terminating these rights and (2) writing down assets associated with these agreements to their approximate fair value. In addition, for one agreement, the actual amount of the loss is variable and subject to periodic adjustments as it is dependent upon the actual revenue we generate from the games. Because the loss for one agreement will be paid in installments through June 2016, our accrued loss was computed using the effective interest method. We currently estimate recognizing in future periods through June 2016, approximately $17 million for the accretion of interest expense related to this obligation. This interest expense will be included in restructuring and other charges in our Condensed Consolidated Statement of Operations. In addition, for the development of certain games, we previously entered into publishing agreements with independent software developers. Under these agreements, we were obligated to pay the independent software developers a predetermined amount (a "Minimum Guarantee") upon delivery of a completed product. The independent software developers were thinly capitalized and they financed the development of products through bank borrowings. During fiscal year 2011, in order to more directly influence the development, product quality and product completion, we amended these agreements whereby we agreed to advance a portion of the Minimum Guarantee prior to completion of the product which were used by the independent software developers to repay their bank loans. In addition, we are now committed to advance the remaining portion of the Minimum Guarantee during the remaining development period. As a result, we have now assumed development risk of the products. Because the independent software developers are thinly capitalized, our sole ability to recover the Minimum Guarantee is effectively through publishing the software product in development. We also have exclusive rights to exploit the software product once completed. Therefore, we concluded that the substance of the arrangement is the purchase of research and development that has no alternative future use and was expensed upon acquisition. Accordingly, we recognized a $31 million charge in our Condensed Consolidated Statement of Operations during the fiscal year ended March 31, 2011. In addition, we will recognize the remaining portion of the Minimum Guarantee to be advanced during the development period as research and development expenses as the services are incurred. Since the inception of the fiscal 2011 restructuring plan through June 30, 2011, we have incurred charges of $164 million, consisting of (1) $121 million related to the amendment of certain licensing agreements and other intangible asset impairment costs, (2) $31 million related to the amendment of certain developer agreements, and (3) $12 million in employee-related expenses. The $111 million restructuring accrual as of June 30, 2011 related to the fiscal 2011 restructuring is expected to be settled by June 2016. During the remainder of fiscal year 2012, we anticipate incurring approximately $5 million of restructuring charges related to the fiscal 2011 restructuring (primarily interest expense accretion). <div>Overall, including $164 million in charges incurred through June 30, 2011, we expect to incur total cash and non-cash charges between $180 million and $190 million by June 2016. These charges will consist primarily of (1) charges, including accretion of interest expense, related to the amendment of certain licensing and developer agreements and other intangible asset impairment costs (approximately $170 million) and (2) employee-related costs (approximately $15 million).</div> Fiscal 2010 Restructuring In fiscal year 2010, we announced a restructuring plan to narrow our product portfolio to provide greater focus on titles with higher margin opportunities. Under this plan, we reduced our workforce by approximately 1,100 employees and have (1) consolidated or closed various facilities, (2) eliminated certain titles, and (3) incurred IT and other costs to assist in reorganizing certain activities. The majority of these exit activities were completed by March 31, 2010. Since the inception of the fiscal 2010 restructuring plan through June 30, 2011, we have incurred charges of $131 million, consisting of (1) $62 million in employee-related expenses, (2) $46 million related to intangible asset impairment costs, abandoned rights to intellectual property, and other costs to assist in the reorganization of our business support functions, and (3) $23 million related to the closure of certain of our facilities. The $8 million restructuring accrual as of June 30, 2011 related to the fiscal 2010 restructuring is expected to be settled by September 2013. During the remainder of fiscal year 2012, we anticipate incurring approximately $5 million of restructuring charges related to the fiscal 2010 restructuring (primarily costs to assist in the reorganization of our business support functions).   Overall, including charges incurred through June 30, 2011, we expect to incur total cash and non-cash charges of approximately $135 million by March 31, 2012. These charges consist primarily of (1) employee-related costs ($62 million), (2) intangible asset impairment costs, abandoned rights to intellectual property costs, and other costs to assist in the reorganization of our business support functions (approximately $50 million), and (3) facilities exit costs ($23 million). Fiscal 2009 Restructuring In fiscal year 2009, we announced a cost reduction plan as a result of our performance combined with the economic environment. This plan included a narrowing of our product portfolio, a reduction in our worldwide workforce of approximately 11 percent, or 1,100 employees, the closure of 10 facilities, and reductions in other variable costs and capital expenditures. Since the inception of the fiscal 2009 restructuring plan through March 31, 2011, we have incurred charges of $55 million, consisting of (1) $33 million in employee-related expenses, (2) $20 million related to the closure of certain of our facilities, and (3) $2 million related to asset impairments. We do not expect to incur any additional restructuring charges under this plan. The restructuring accrual of $2 million as of June 30, 2011 related to the fiscal 2009 restructuring is expected to be settled by September 2016.

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<div class="MetaData"> Revenue Recognition   We evaluate revenue recognition based on the criteria set forth in Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 985-605, Software: Revenue Recognition and Staff Accounting Bulletin ("SAB") No. 101, Revenue Recognition in Financial Statements, as revised by SAB No. 104, Revenue Recognition. We evaluate and recognize revenue when all four of the following criteria are met:   ·Evidence of an arrangement. Evidence of an agreement with the customer that reflects the terms and conditions to deliver products must be present.   ·Delivery. Delivery is considered to occur when a product is shipped and the risk of loss and rewards of ownership have been transferred to the customer. For online game services, delivery is considered to occur as the service is provided. For digital downloads that do not have an online service component, delivery is generally considered to occur when the download is made available.   ·Fixed or determinable fee. If a portion of the arrangement fee is not fixed or determinable, we recognize revenue as the amount becomes fixed or determinable.   ·Collection is deemed probable. We conduct a credit review of each customer involved in a significant transaction to determine the creditworthiness of the customer. Collection is deemed probable if we expect the customer to be able to pay amounts under the arrangement as those amounts become due. If we determine that collection is not probable, we recognize revenue when collection becomes probable (generally upon cash collection).   Determining whether and when some of these criteria have been satisfied often involves assumptions and management judgments that can have a significant impact on the timing and amount of revenue we report in each period. For example, for multiple element arrangements, we must make assumptions and judgments in order to (1) determine whether and when each element has been delivered, (2) determine whether undelivered products or services are essential to the functionality of the delivered products and services, (3) determine whether vendor specific objective evidence ("VSOE") exists for each undelivered element, and (4) allocate the total price among the various elements we must deliver. Changes to any of these assumptions or management judgments, or changes to the elements in a software arrangement, could cause a material increase or decrease in the amount of revenue that we report in a particular period.   Depending on the type of product, we may offer an online service that permits consumers to play against others via the Internet and/or receive additional updates or content from us. For those games that consumers can play via the Internet, we may provide a "matchmaking" service that permits consumers to connect with other consumers to play against each other online. In those situations where we do not require an additional fee for this online service, we account for the sale of the software product and the online service as a "bundled" sale, or multiple element arrangement, in which we sell both the software product and the online service for one combined price. We defer net revenue from sales of these games for which we do not have VSOE for the online service that we provided in connection with the sale, and recognize the revenue from these games over the estimated online service period, which is generally estimated to be six months beginning in the month after shipment. In addition, for some software products we also provide updates or additional content ("digital content") to be delivered via the Internet that can be used with the original software product. In many cases we separately sell digital content for an additional fee; however, some purchased digital content can only be accessed via the Internet (i.e., the consumer never takes possession of the digital content). We account for online transactions in which the consumer does not take possession of the digital content as a service transaction and, accordingly, we recognize the associated revenue over the estimated service period. In other transactions, at the date we sell the software product we have an obligation to provide incremental unspecified digital content in the future without an additional fee. In these cases, we account for the sale of the software product as a multiple element arrangement and recognize the revenue on a straight-line basis over the estimated period of game play.   Determining whether a transaction constitutes an online service transaction or a digital content download of a product requires judgment and can be difficult. The accounting for these transactions is significantly different. Revenue from product downloads is generally recognized when the download is made available (assuming all other recognition criteria are met). Revenue from an online game service is recognized as the service is rendered. If the service period is not defined, we recognize the revenue over the estimated service period. Determining the estimated service period is inherently subjective and is subject to regular revision based on historical online usage. In addition, determining whether we have an implicit obligation to provide incremental unspecified future digital content without an additional fee can be difficult.   Product Revenue. Product revenue, including sales to resellers and distributors ("channel partners"), is recognized when the above criteria are met. We reduce product revenue for estimated future returns, price protection, and other offerings, which may occur with our customers and channel partners.   Multiple Element Revenue Arrangements. On April 3, 2011 we adopted the FASB Accounting Standards Update ("ASU") 2009-13, Revenue Recognition (Topic 605): Multiple-Deliverable Revenue Arrangements and ASU 2009-14, Software (Topic 985): Certain Revenue Arrangements that Include Software Elements.   ASU 2009-13 modifies the fair value requirements of ASC subtopic 605-25, Revenue Recognition-Multiple Element Arrangements, by allowing the use of the "best estimate of selling price" in addition to vendor-specific objective evidence and third-party evidence for determining the selling price of a deliverable for non-software arrangements. It establishes a selling price hierarchy for determining the selling price of a deliverable, which is based on: (1) vendor-specific objective evidence, (2) third-party evidence, or (3) estimates. In addition, the residual method of allocating arrangement consideration is no longer permitted.   ASU 2009-14 modifies the scope of ASC subtopic 985-605, Software-Revenue Recognition, to exclude from its requirements non-software components of tangible products and software components of tangible products that are sold, licensed, or leased with tangible products when the software components and non-software components of the tangible product function together to deliver the tangible product's essential functionality.   The adoption of ASU 2009-13 and ASU 2009-14 did not have a material impact on our Condensed Consolidated Financial Statements as substantially all of our revenue arrangements with multiple deliverables remain under ASC 985-605. As certain of our revenue arrangements include software and hardware deliverables (such as peripherals or other ancillary collectors' items sold together with the physical "boxed" software), the new accounting principles would apply to these types of arrangements. The new accounting principles establish a selling price hierarchy for determining the selling price of a deliverable and require the application of the relative selling price method to allocate the arrangement consideration to each deliverable in a multiple element arrangement. As of the quarter ended June 30, 2011, we do not have significant revenue arrangements that require our best estimate of selling price.   Shipping and Handling. We recognize amounts billed to customers for shipping and handling as revenue. Additionally, shipping and handling costs incurred by us are included in cost of goods sold.   Online Subscription Revenue. Online subscription revenue is derived principally from subscription revenue collected from customers for online play related to our massively multiplayer online games and Pogo-branded online games services. These customers generally pay on an annual basis or a month-to-month basis and prepaid subscription revenue is recognized ratably over the period for which the services are provided.   Software Licenses. We license software rights to manufacturers of products in related industries (for example, makers of personal computers or computer accessories) to include certain of our products with the manufacturer's product, or offer our products to consumers who have purchased the manufacturer's product. We call these combined products "OEM bundles." These OEM bundles generally require the customer to pay us an upfront nonrefundable fee, which represents the guaranteed minimum royalty amount. Revenue is generally recognized upon delivery of the product master or the first copy. Per-copy royalties on sales that exceed the minimum guarantee are recognized as earned. </div>

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8000000

11000000

<table border="0" cellspacing="0"> <tr><td width="70%"> </td> <td width="5%"> </td> <td width="9%"> </td> <td width="3%"> </td> <td width="7%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="center">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Net income</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">221</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">96</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Other comprehensive income (loss):</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Change in unrealized gains (losses) on available-for-sale securities</td> <td align="left"> </td> <td align="right">13</td> <td align="left"> </td> <td align="right">(89</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Reclassification adjustment for realized losses on available-for-sale securities</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">5</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Change in unrealized gains on derivative instruments</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">(1</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Reclassification adjustment for realized losses on derivative instruments</td> <td align="left"> </td> <td align="right">2</td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Foreign currency translation adjustments</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">6</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(31</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr><td colspan="6"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Total other comprehensive income (loss)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">21</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(115</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr><td colspan="6"> </td></tr> <tr valign="bottom"><td align="left">Total comprehensive income (loss)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">242</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">(19</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="64%"> </td> <td width="7%"> </td> <td width="10%"> </td> <td width="8%"> </td> <td width="5%"> </td> <td width="4%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="right">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">(In millions, except per share data)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr><td colspan="6"> </td></tr> <tr valign="bottom"><td align="left">Net income</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">221</td> <td style="border-bottom: #000000 3px double; text-indent: 5px;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">96</td></tr> <tr valign="bottom"><td align="left">Shares used to compute net income per share:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Weighted-average common stock outstanding - basic</td> <td align="left"> </td> <td align="right">331</td> <td align="left"> </td> <td align="left"> </td> <td align="right">328</td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Dilutive potential common shares</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">6</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">4</td></tr> <tr><td colspan="6"> </td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Weighted-average common stock outstanding - diluted</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">337</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">332</td></tr> <tr valign="bottom"><td align="left">Net income per share:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Basic</td> <td align="left">$</td> <td align="right">0.67</td> <td style="text-indent: 5px;" align="left">$</td> <td align="left"> </td> <td align="right">0.29</td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Diluted</td> <td align="left">$</td> <td align="right">0.66</td> <td style="text-indent: 5px;" align="left">$</td> <td align="left"> </td> <td align="right">0.29</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="56%"> </td> <td width="11%"> </td> <td width="8%"> </td> <td width="6%"> </td> <td width="13%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="left">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Cost of goods sold</td> <td align="left">$</td> <td align="left"> </td> <td align="right">1</td> <td align="right">$</td> <td align="right">1</td></tr> <tr valign="bottom"><td align="left">Marketing and sales</td> <td align="left"> </td> <td align="left"> </td> <td align="right">5</td> <td align="left"> </td> <td align="right">4</td></tr> <tr valign="bottom"><td align="left">General and administrative</td> <td align="left"> </td> <td align="left"> </td> <td align="right">9</td> <td align="left"> </td> <td align="right">12</td></tr> <tr valign="bottom"><td align="left">Research and development</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">23</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">30</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Stock-based compensation expense</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">38</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">47</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="38%"> </td> <td width="22%"> </td> <td width="8%"> </td> <td width="9%"> </td> <td width="8%"> </td> <td width="6%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="left">As of June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 1px solid;" align="center">Long-lived assets</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">North America</td> <td align="left">$</td> <td align="left"> </td> <td align="right">1,289</td> <td align="left">$</td> <td align="left"> </td> <td align="right">1,325</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Europe</td> <td align="left"> </td> <td align="left"> </td> <td align="right">440</td> <td align="left"> </td> <td align="left"> </td> <td align="right">432</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Asia</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">34</td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Total</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1,782</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1,791</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="26%"> </td> <td width="2%"> </td> <td width="10%"> </td> <td width="4%"> </td> <td width="6%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="10%"> </td> <td width="2%"> </td> <td width="6%"> </td> <td width="4%"> </td> <td width="6%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="7%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="left">As of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="left">As of March 31, 2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="right"> </td> <td align="center">Gross</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Acquisition-</td> <td align="left"> </td> <td align="center">Gross</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td colspan="2" align="center">Acquisition-</td></tr> <tr valign="bottom"><td align="left"> </td> <td align="right"> </td> <td style="text-indent: 1px;" align="left">Carrying</td> <td align="left"> </td> <td align="right">Accumulated</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Related</td> <td align="left"> </td> <td align="center">Carrying</td> <td align="left"> </td> <td align="right">Accumulated</td> <td align="left"> </td> <td align="left"> </td> <td align="center">Related</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="center">Amount</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Amortization</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Intangibles, Net</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Amount</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Amortization</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Intangibles, Net</td></tr> <tr><td colspan="15"> </td></tr> <tr valign="bottom"><td align="left">Developed and core technology</td> <td align="right">$</td> <td align="right">265</td> <td align="left">$</td> <td align="right">(187</td> <td align="left">)</td> <td align="left">$</td> <td align="right">78</td> <td align="left">$</td> <td align="right">259</td> <td style="text-indent: 1px;" align="left">$</td> <td align="right">(180</td> <td align="left">)</td> <td align="left">$</td> <td align="right">79</td></tr> <tr valign="bottom"><td align="left">Trade names and trademarks</td> <td align="right"> </td> <td align="right">90</td> <td align="left"> </td> <td align="right">(73</td> <td align="left">)</td> <td align="left"> </td> <td align="right">17</td> <td align="left"> </td> <td align="right">90</td> <td align="left"> </td> <td align="right">(70</td> <td align="left">)</td> <td align="left"> </td> <td align="right">20</td></tr> <tr valign="bottom"><td align="left">Registered user base and other intangibles</td> <td align="right"> </td> <td align="right">86</td> <td align="left"> </td> <td align="right">(69</td> <td align="left">)</td> <td align="left"> </td> <td align="right">17</td> <td align="left"> </td> <td align="right">86</td> <td align="left"> </td> <td align="right">(64</td> <td align="left">)</td> <td align="left"> </td> <td align="right">22</td></tr> <tr valign="bottom"><td align="left">Carrier contracts and related</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">85</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(63</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">22</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">85</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(62</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">23</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Total</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">526</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">(392</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">134</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">520</td> <td style="border-bottom: #000000 3px double; text-indent: 1px;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">(376</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">144</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="65%"> </td> <td width="26%"> </td> <td width="7%"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 1px solid;" align="left">Fiscal Year Ending March 31,</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">2012 (remaining nine months)</td> <td align="left">$</td> <td align="right">37</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">2013</td> <td align="left"> </td> <td align="right">31</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">2014</td> <td align="left"> </td> <td align="right">20</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">2015</td> <td align="left"> </td> <td align="right">15</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">2016</td> <td align="left"> </td> <td align="right">6</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Thereafter</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">25</td></tr> <tr valign="bottom"><td style="text-indent: 12px;" align="left">Total</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">134</td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="39%"> </td> <td width="10%"> </td> <td width="9%"> </td> <td width="7%"> </td> <td width="10%"> </td> <td width="4%"> </td> <td width="4%"> </td> <td width="9%"> </td> <td width="4%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Label Segment</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Other Segments</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Total</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">As of March 31, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Goodwill</td> <td align="left">$</td> <td align="right">691</td> <td align="left">$</td> <td align="right">787</td> <td align="left"> </td> <td align="left">$</td> <td align="right">1,478</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Accumulated impairment</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(368</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(368</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">691</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">419</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1,110</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr><td colspan="9"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Goodwill acquired</td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right">21</td> <td align="left"> </td> <td align="left"> </td> <td align="right">21</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Effects of foreign currency translation</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr><td colspan="9"> </td></tr> <tr valign="bottom"><td align="left">As of June 30, 2011</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Goodwill</td> <td align="left"> </td> <td align="right">691</td> <td align="left"> </td> <td align="right">809</td> <td align="left"> </td> <td align="left"> </td> <td align="right">1,500</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 1px;" align="left">Accumulated impairment</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(368</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(368</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">691</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">441</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">1,132</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="17%"> </td> <td width="2%"> </td> <td width="7%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="6%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="7%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="4%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="9%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="6%"> </td> <td width="2%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Fiscal 2009</td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="4" align="right">Fiscal 2011 Restructuring</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" colspan="6" align="right">Fiscal 2010 Restructuring</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">Restructuring</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td> <td colspan="2" align="right">Facilities-</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="center">Facilities-</td> <td align="left"> </td> <td align="right"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Workforce</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">Other</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">Workforce</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">related</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">Other</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="center">related</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="center">Total</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="center">Balances as of March 31, 2010</td> <td align="left">$</td> <td align="right">-</td> <td align="left"> </td> <td align="left">$</td> <td align="right">-</td> <td align="left"> </td> <td align="right">$</td> <td align="right">8</td> <td align="left"> </td> <td align="left">$</td> <td align="right">11</td> <td align="left"> </td> <td align="right">$</td> <td align="right">7</td> <td align="left"> </td> <td align="left">$</td> <td align="right">3</td> <td align="left"> </td> <td align="right">$</td> <td align="right">29</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges to operations</td> <td align="left"> </td> <td align="right">13</td> <td align="left"> </td> <td align="left"> </td> <td align="right">135</td> <td align="left"> </td> <td align="right"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">13</td> <td align="left"> </td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right"> </td> <td align="right">161</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges settled in cash</td> <td align="left"> </td> <td align="right">(8</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(32</td> <td align="left">)</td> <td align="right"> </td> <td align="right">(8</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(6</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(15</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(1</td> <td align="left">)</td> <td align="right"> </td> <td align="right">(70</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges settled in non-cash</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(2</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(2</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">(3</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="center">Balances as of March 31, 2011</td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td> <td align="left"> </td> <td align="right">101</td> <td align="left"> </td> <td align="right"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">6</td> <td align="left"> </td> <td align="left"> </td> <td align="right">5</td> <td align="left"> </td> <td align="left"> </td> <td align="right">2</td> <td align="left"> </td> <td align="right"> </td> <td align="right">117</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges to operations</td> <td align="left"> </td> <td align="right">(1</td> <td align="left">)</td> <td align="left"> </td> <td align="right">17</td> <td align="left"> </td> <td align="right"> </td> <td align="right">-</td> <td align="left"> </td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="left"> </td> <td align="right">1</td> <td align="left"> </td> <td align="left"> </td> <td align="right">-</td> <td align="left"> </td> <td align="right"> </td> <td align="right">18</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Charges settled in cash</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(9</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(2</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(3</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right"> </td> <td style="border-bottom: #000000 3px double;" align="right">(14</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="center">Balances as of June 30, 2011</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">2</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">109</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">-</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">5</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">3</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">2</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">121</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table>

<table border="0" cellspacing="0"> <tr><td width="51%"> </td> <td width="9%"> </td> <td width="9%"> </td> <td width="7%"> </td> <td width="15%"> </td> <td width="5%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="center">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 1px solid;" align="left">Net revenue from unaffiliated customers</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">North America</td> <td align="left">$</td> <td align="left"> </td> <td align="right">501</td> <td align="right">$</td> <td align="right">451</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Europe</td> <td align="left"> </td> <td align="left"> </td> <td align="right">438</td> <td align="left"> </td> <td align="right">317</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Asia</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">60</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">47</td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Total</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">999</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">815</td></tr></table>

(16) SEGMENT INFORMATION Our reporting segments are based upon: our internal organizational structure; the manner in which our operations are managed; the criteria used by our Chief Executive Officer, our Chief Operating Decision Maker ("CODM"), to evaluate segment performance; the availability of separate financial information; and overall materiality considerations. Our business is currently organized around three operating labels, EA Games, EA SPORTS and EA Play, as well as EA Interactive. Our CODM regularly receives separate financial information for distinct businesses within the EA Interactive organization, including EA Mobile, the combined results of Pogo and Playfish, and Hasbro. Accordingly, in assessing performance and allocating resources, our CODM reviews the results of our three Labels, as well as the operating segments in EA Interactive, including EA Mobile, the combined results of Pogo and Playfish, and Hasbro. Due to their similar economic characteristics, products, and distribution methods, EA Games, EA SPORTS, EA Play, and Hasbro's results are aggregated into one Reportable Segment (the "Label segment") as shown below. The remaining operating segments' results are not material for separate disclosure and are included in the reconciliation of Label segment profit (loss) to our consolidated operating income below. In addition to assessing performance and allocating resources based on our operating segments as described herein, to a lesser degree, our CODM also reviews results based on geographic performance. The following table summarizes the financial performance of the Label segment and a reconciliation of the Label segment's profit (loss) to our consolidated operating income for the three months ended June 30, 2011 and 2010 (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="49%"> </td> <td width="11%"> </td> <td width="6%"> </td> <td width="6%"> </td> <td width="3%"> </td> <td width="11%"> </td> <td width="5%"> </td> <td width="3%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td style="text-indent: 3px;" colspan="4" align="left">Three Months Ended</td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="3" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left">Label segment:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Net revenue before revenue deferral</td> <td align="left">$</td> <td align="left"> </td> <td align="right">409</td> <td align="left"> </td> <td align="right">$</td> <td align="right">430</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Depreciation and amortization</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(11</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(11</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Other expenses</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(445</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(416</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="left">Label segment profit (loss)</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(47</td> <td align="left">)</td> <td align="left"> </td> <td align="right">3</td> <td align="left"> </td></tr> <tr><td colspan="8"> </td></tr> <tr valign="bottom"><td align="left">Reconciliation to consolidated operating income:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left">Other:</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Revenue deferral</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(250</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(318</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Recognition of revenue deferral</td> <td align="left"> </td> <td align="left"> </td> <td align="right">725</td> <td align="left"> </td> <td align="left"> </td> <td align="right">594</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Other net revenue</td> <td align="left"> </td> <td align="left"> </td> <td align="right">115</td> <td align="left"> </td> <td align="left"> </td> <td align="right">109</td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Depreciation and amortization</td> <td align="left"> </td> <td align="left"> </td> <td align="right">(30</td> <td align="left">)</td> <td align="left"> </td> <td align="right">(35</td> <td align="left">)</td></tr> <tr valign="bottom"><td style="text-indent: 5px;" align="left">Other expenses</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(286</td> <td style="border-bottom: #000000 3px double;" align="left">)</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">(255</td> <td style="border-bottom: #000000 3px double;" align="left">)</td></tr> <tr valign="bottom"><td align="left">Consolidated operating income</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">227</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">98</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr></table></div> <div align="left"> </div>   Label segment profit (loss) differs from consolidated operating income primarily due to the exclusion of (1) certain corporate and other functional costs that are not allocated to the Labels, (2) the deferral of certain net revenue related to online-enabled packaged goods and digital content (see Note 10 of the Notes to Condensed Consolidated Financial Statements), and (3) the results of EA Mobile, the combined results of Pogo and Playfish, and our Switzerland distribution revenue that has not been allocated to the Labels. Our CODM reviews assets on a consolidated basis and not on a segment basis. Information about our total net revenue by platform for the three months ended June 30, 2011 and 2010 is presented below (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="52%"> </td> <td width="12%"> </td> <td width="15%"> </td> <td width="6%"> </td> <td width="12%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="right">Three Months Ended</td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td></tr> <tr valign="bottom"><td align="left">Consoles</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Xbox 360</td> <td align="left">$</td> <td align="right">345</td> <td align="right">$</td> <td align="right">262</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">PLAYSTATION 3</td> <td align="left"> </td> <td align="right">308</td> <td align="left"> </td> <td align="right">209</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Wii</td> <td align="left"> </td> <td align="right">42</td> <td align="left"> </td> <td align="right">40</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">PlayStation 2</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">3</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">11</td></tr> <tr valign="bottom"><td style="text-indent: 6px;" align="left">Total consoles</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">698</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">522</td></tr> <tr><td colspan="5"> </td></tr> <tr valign="bottom"><td align="left">PC</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">205</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">186</td></tr> <tr valign="bottom"><td align="left">Mobile and handhelds</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Mobile</td> <td align="left"> </td> <td align="right">57</td> <td align="left"> </td> <td align="right">52</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">PSP</td> <td align="left"> </td> <td align="right">11</td> <td align="left"> </td> <td align="right">19</td></tr> <tr valign="bottom"><td style="text-indent: 3px;" align="left">Nintendo DS</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">8</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">11</td></tr> <tr valign="bottom"><td style="text-indent: 6px;" align="left">Total mobile and handhelds</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">76</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">82</td></tr> <tr><td colspan="5"> </td></tr> <tr valign="bottom"><td align="left">Other</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">20</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">25</td></tr> <tr valign="bottom"><td align="left">Total net revenue</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="right">999</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">815</td></tr></table></div>   Information about our operations in North America, Europe and Asia as of and for the three months ended June 30, 2011 and 2010 is presented below (in millions): <div align="left"> <table border="0" cellspacing="0"> <tr><td width="51%"> </td> <td width="9%"> </td> <td width="9%"> </td> <td width="7%"> </td> <td width="15%"> </td> <td width="5%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td align="left"> </td> <td colspan="3" align="center">Three Months Ended</td> <td align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="right">June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 1px solid;" align="left">Net revenue from unaffiliated customers</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">North America</td> <td align="left">$</td> <td align="left"> </td> <td align="right">501</td> <td align="right">$</td> <td align="right">451</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Europe</td> <td align="left"> </td> <td align="left"> </td> <td align="right">438</td> <td align="left"> </td> <td align="right">317</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Asia</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">60</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">47</td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Total</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">999</td> <td style="border-bottom: #000000 3px double;" align="right">$</td> <td style="border-bottom: #000000 3px double;" align="right">815</td></tr></table></div> <div align="left"> </div>   <div align="left"> <table border="0" cellspacing="0"> <tr><td width="38%"> </td> <td width="22%"> </td> <td width="8%"> </td> <td width="9%"> </td> <td width="8%"> </td> <td width="6%"> </td> <td width="6%"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" colspan="2" align="left">As of June 30,</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2011</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left">2010</td> <td style="border-bottom: #000000 3px double;" align="left"> </td></tr> <tr valign="bottom"><td style="border-bottom: #000000 1px solid;" align="center">Long-lived assets</td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td> <td align="left"> </td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">North America</td> <td align="left">$</td> <td align="left"> </td> <td align="right">1,289</td> <td align="left">$</td> <td align="left"> </td> <td align="right">1,325</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Europe</td> <td align="left"> </td> <td align="left"> </td> <td align="right">440</td> <td align="left"> </td> <td align="left"> </td> <td align="right">432</td></tr> <tr valign="bottom"><td style="text-indent: 2px;" align="left">Asia</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">53</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">34</td></tr> <tr valign="bottom"><td style="text-indent: 4px;" align="left">Total</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1,782</td> <td style="border-bottom: #000000 3px double;" align="left">$</td> <td style="border-bottom: #000000 3px double;" align="left"> </td> <td style="border-bottom: #000000 3px double;" align="right">1,791</td></tr></table></div> <div align="left"> </div> Our direct sales to GameStop Corp. represented approximately 18 percent and 14 percent of total net revenue for the three months ended June 30, 2011 and 2010, respectively. Our direct sales to Wal-Mart Stores Inc. did not exceed 10 percent of total net revenue for the three months ended June 30, 2011. Our direct sales to Wal-Mart Stores Inc. represented approximately 11 percent of total net revenue for the three months ended June 30, 2010.

430000000

409000000

127000000

140000000

47000000

38000000

169000

664000

20.01

19.91

670000

6995000

17.65

34.77

22.35

1993000

13971000

1824000