Q2 2005 Earnings

Reported December 31, 2004

Quarter Comparison

Revenue

Operating Income

Gross Margin

Net Margin

EPS (Diluted)

Metric	Q2 2005	Q1 2005	Q2 2004	QoQ Change	YoY Change
Revenue	$4.5B	—	$6.0B	—	-24.9%
Op. Income	$1.2B	—	$1.3B	—	-7.5%
Gross Margin	61.0%	—	21.5%	—	39.5pp
Net Margin	20.1%	—	15.7%	—	4.5pp
EPS (Diluted)	$2.16	—	$0.90	—	138.8%

Revenue Flow

Item	Amount
REVENUE	$4.5B
Cost of Revenue	$1.8B
GROSS PROFIT	$2.7B
R&D Expenses	$683M
Selling & Marketing	$683M
General & Administrative	$0
SG&A Expenses	$683M
Other Expenses	-$186M
Operating Expenses	$1.6B
Cost & Expenses	$3.3B
OPERATING INCOME	$1.2B
Interest Income	$88M
Interest Expense	$183M
Other Income/Expenses	-$119M
INCOME BEFORE TAX	$1.3B
Income Tax Expense	$404M
Net Income from Continuing Ops	$1.5B
Net Income from Discontinued Ops	-$715M
Other Adjustments	$154M
NET INCOME	$906M
Net Income Deductions	-$1.8B
BOTTOM LINE NET INCOME	$1.6B
D&A	$162M
EBIT	$2.1B
EBITDA	$2.4B
EPS	$2
EPS Diluted	$2

Income Statement

Item	Amount
REVENUE	$4.5B
Cost of Revenue	$1.8B
GROSS PROFIT	$2.7B
R&D Expenses	$683M
Selling & Marketing	$683M
General & Administrative	$0
SG&A Expenses	$683M
Other Expenses	-$186M
Operating Expenses	$1.6B
Cost & Expenses	$3.3B
OPERATING INCOME	$1.2B
Interest Income	$88M
Interest Expense	$183M
Other Income/Expenses	-$119M
INCOME BEFORE TAX	$1.3B
Income Tax Expense	$404M
Net Income from Continuing Ops	$1.5B
Net Income from Discontinued Ops	-$715M
Other Adjustments	$154M
NET INCOME	$906M
Net Income Deductions	-$1.8B
BOTTOM LINE NET INCOME	$1.6B
D&A	$162M
EBIT	$2.1B
EBITDA	$2.4B
EPS	$2
EPS Diluted	$2