Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Apr. 01, 2017 | Apr. 20, 2017 | |
Entity Information [Line Items] | ||
Entity Registrant Name | CERNER CORP /MO/ | |
Entity Central Index Key | 804,753 | |
Document Type | 10-Q | |
Document Period End Date | Apr. 1, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 330,429,274 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Apr. 01, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 378,452 | $ 170,861 |
Short-term investments | 153,458 | 185,588 |
Receivables, net | 986,354 | 944,943 |
Inventory | 19,013 | 14,740 |
Prepaid expenses and other | 288,833 | 303,229 |
Total current assets | 1,826,110 | 1,619,361 |
Property and equipment, net | 1,569,023 | 1,552,524 |
Software development costs, net | 751,705 | 719,209 |
Goodwill | 845,842 | 844,200 |
Intangible assets, net | 542,715 | 566,047 |
Long-term investments | 77,206 | 109,374 |
Other assets | 190,607 | 219,248 |
Total assets | 5,803,208 | 5,629,963 |
Current liabilities: | ||
Accounts payable | 207,001 | 238,134 |
Current installments of long-term debt and capital lease obligations | 17,398 | 26,197 |
Deferred revenue | 338,074 | 311,839 |
Accrued payroll and tax withholdings | 208,467 | 211,554 |
Other accrued expenses | 62,599 | 57,677 |
Total current liabilities | 833,539 | 845,401 |
Long-term debt and capital lease obligations | 532,747 | 537,552 |
Deferred income taxes and other liabilities | 311,540 | 306,263 |
Deferred revenue | 12,506 | 12,800 |
Total liabilities | 1,690,332 | 1,702,016 |
Shareholders' Equity: | ||
Common stock, $.01 par value, 500,000,000 shares authorized, 354,442,293 shares issued at April 1, 2017 and 353,731,237 shares issued at December 31, 2016 | 3,545 | 3,537 |
Additional paid-in capital | 1,254,544 | 1,230,913 |
Retained earnings | 4,245,101 | 4,094,327 |
Treasury stock, 24,089,737 shares at April 1, 2017 and December 31, 2016 | (1,290,665) | (1,290,665) |
Accumulated other comprehensive loss, net | (99,649) | (110,165) |
Total shareholders' equity | 4,112,876 | 3,927,947 |
Total liabilities and shareholders' equity | $ 5,803,208 | $ 5,629,963 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Apr. 01, 2017 | Dec. 31, 2016 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares issued | 354,442,293 | 353,731,237 |
Treasury stock, shares | 24,089,737 | 24,089,737 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Revenues: | ||
System sales | $ 319,856 | $ 279,354 |
Support, maintenance and services | 918,238 | 839,638 |
Reimbursed travel | 22,392 | 19,143 |
Total revenues | 1,260,486 | 1,138,135 |
Costs and expenses: | ||
Cost of system sales | 100,409 | 89,225 |
Cost of support, maintenance and services | 76,192 | 67,225 |
Cost of reimbursed travel | 22,392 | 19,143 |
Sales and client service | 560,200 | 501,827 |
Software development (Includes amortization of $40,561 and $32,614, respectively) | 145,901 | 133,532 |
General and administrative | 88,392 | 90,134 |
Amortization of acquisition-related intangibles | 22,874 | 21,601 |
Total costs and expenses | 1,016,360 | 922,687 |
Operating earnings | 244,126 | 215,448 |
Other income (expense), net | (1,116) | 1,681 |
Earnings before income taxes | 243,010 | 217,129 |
Income taxes | (69,797) | (66,769) |
Net earnings | $ 173,213 | $ 150,360 |
Basic earnings per share | $ 0.52 | $ 0.44 |
Diluted earnings per share | $ 0.52 | $ 0.43 |
Basic weighted average shares outstanding | 329,973 | 339,518 |
Diluted weighted average shares outstanding | 336,190 | 345,900 |
Consolidated Statements Of Ope5
Consolidated Statements Of Operations (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Income Statement [Abstract] | ||
Software development, amortization | $ 40,561 | $ 32,614 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | ||
Net earnings | $ 173,213 | $ 150,360 |
Foreign currency translation adjustment and other (net of taxes of $187 and $2,122, respectively) | 10,405 | 8,290 |
Unrealized holding gain on available-for-sale investments (net of taxes of $68 and $233, respectively) | 111 | 380 |
Comprehensive income | $ 183,729 | $ 159,030 |
Consolidated Statements Of Com7
Consolidated Statements Of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Foreign currency translation adjustment and other, taxes (benefit) | $ 187 | $ 2,122 |
Change in net unrealized holding gain (loss) on available-for-sale investments, taxes (benefit) | $ 68 | $ 233 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net earnings | $ 173,213 | $ 150,360 |
Adjustments to reconcile net earnings to net cash provided by operating activities: | ||
Depreciation and amortization | 134,833 | 119,126 |
Share-based compensation expense | 17,500 | 17,811 |
Provision for deferred income taxes | 11,214 | 7,978 |
Changes in assets and liabilities (net of businesses acquired): | ||
Receivables, net | (34,236) | 101,787 |
Inventory | (4,266) | (8,452) |
Prepaid expenses and other | 27,270 | (4,751) |
Accounts payable | (21,908) | (23,060) |
Accrued income taxes | 768 | 11,201 |
Deferred revenue | 24,269 | (32,309) |
Other accrued liabilities | (25,072) | (3,486) |
Net cash provided by operating activities | 303,585 | 336,205 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital purchases | (88,065) | (99,351) |
Capitalized software development costs | (71,092) | (75,340) |
Purchases of investments | (53,340) | (157,744) |
Sales and maturities of investments | 115,030 | 32,473 |
Purchase of other intangibles | (6,385) | (3,592) |
Acquisition of businesses, net of cash acquired | 0 | 0 |
Net cash used in investing activities | (103,852) | (303,554) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from exercise of options | 10,683 | 10,421 |
Payments to taxing authorities in connection with shares directly withheld from associates | (5,314) | (419) |
Treasury stock purchases | 0 | (150,056) |
Contingent consideration payments for acquisition of businesses | (1,000) | 0 |
Net cash provided by (used in) financing activities | 4,369 | (140,054) |
Effect of exchange rate changes on cash and cash equivalents | 3,489 | 870 |
Net increase (decrease) in cash and cash equivalents | 207,591 | (106,533) |
Cash and cash equivalents at beginning of period | 170,861 | 402,122 |
Cash and cash equivalents at end of period | 378,452 | 295,589 |
Summary of acquisition transactions: | ||
Fair value of tangible assets acquired | 0 | (10,200) |
Fair value of intangible assets acquired | 0 | (25,000) |
Fair value of goodwill | 0 | 46,940 |
Less: Fair value of liabilities assumed | 0 | (11,740) |
Net cash used | $ 0 | $ 0 |
Interim Statement Presentation
Interim Statement Presentation (Notes) | 3 Months Ended |
Apr. 01, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Interim Statement Presentation | Interim Statement Presentation Basis of Presentation The condensed consolidated financial statements included herein have been prepared by Cerner Corporation ("Cerner," the "Company," "we," "us" or "our") without audit, pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") have been condensed or omitted pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and the notes thereto included in our latest annual report on Form 10-K. In management’s opinion, the accompanying unaudited condensed consolidated financial statements include all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the financial position and the results of operations and cash flows for the periods presented. Our interim results as presented in this Form 10-Q are not necessarily indicative of the operating results for the entire year. The condensed consolidated financial statements were prepared using GAAP . These principles require us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses . Actual results could differ from those estimates. Fiscal Period End Our first fiscal quarter ends on the Saturday closest to March 31. The 2017 and 2016 first quarters ended on April 1, 2017 and April 2, 2016, respectively. All references to years in these notes to condensed consolidated financial statements represent the respective three months ended on such dates, unless otherwise noted. Accounting Pronouncements Adopted in 2017 Share-Based Compensation. In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . ASU 2016-09 impacts several aspects of the accounting for share-based payment award transactions, including: (1) accounting and cash flow classification for excess tax benefits and deficiencies, (2) forfeitures, and (3) tax withholding requirements and cash flow classification . ASU 2016-09 was effective for the Company in the first quarter of 2017. This new guidance impacts our condensed consolidated financial statements as follows: • Prior to the adoption of ASU 2016-09, when associates exercised stock options, or upon the vesting of restricted stock awards, we recognized any related excess tax benefits or deficiencies (the difference between the deduction for tax purposes and the cumulative compensation cost recognized in the consolidated financial statements) in additional paid-in capital ("APIC"). We recognized net excess tax benefits of $9 million in APIC during the three months ended April 2, 2016. Under the new guidance, all excess tax benefits and tax deficiencies are recognized as a component of income tax expense. They are not estimated when determining the annual estimated effective tax rate; instead, they are recorded as discrete items in the reporting period they occur. During the three months ended April 1, 2017 we recognized $8 million of net excess tax benefits as discrete items, which are included in income taxes in our condensed consolidated statements of operations. These net excess tax benefits recognized during the three months ended April 1, 2017 resulted in a $0.02 favorable impact on diluted earnings per share. This provision of the new guidance may have a significant impact on our future income tax expense, including increased variability in our quarterly effective tax rates. The impact will be dependent on a number of factors, including the price of our common stock, grant activity under our stock and equity plans, and the timing of option exercises by our associates. This provision of the new guidance was required to be applied prospectively. Prior periods have not been retrospectively adjusted. • We utilize the treasury stock method for calculating diluted earnings per share. Prior to the adoption of ASU 2016-09, this method assumed that any net excess tax benefits generated from the hypothetical exercise of dilutive options were used to repurchase outstanding shares. Assumed share repurchases for net excess tax benefits included in our calculation of diluted earnings per share for the three months ended April 2, 2016 were 2.2 million shares. Under the new guidance, excess tax benefits generated from the hypothetical exercise of dilutive options are excluded from the calculation of diluted earnings per share. Therefore, the denominator in our diluted earnings per share calculation has increased (comparatively). We estimate that this provision of the new guidance will reduce our calculation of diluted earnings per share by approximately $0.01 to $0.02 for our fiscal year ended December 30, 2017. This provision of the new guidance was required to be applied prospectively. Prior periods have not been retrospectively adjusted. • Prior to the adoption of ASU 2016-09, we presented net excess tax benefits in our condensed consolidated statements of cash flows as a cash inflow from financing activities. Under the new guidance, net excess tax benefits are presented within operating activities. We have elected to apply this provision of the new guidance retrospectively. Prior periods have been retrospectively adjusted. • Prior to the adoption of ASU 2016-09, we presented cash payments to taxing authorities in connection with shares directly withheld from associates upon the exercise of stock options, or upon the vesting of restricted stock awards, to meet statutory tax withholding requirements (employee withholdings) as a cash outflow from operating activities. Under the new guidance, such payments are presented within financing activities. This provision of the new guidance was required to be applied retrospectively. Prior periods have been retrospectively adjusted. • Under the new guidance, an entity is permitted to make an entity-wide accounting policy election (at adoption) either to estimate the number of forfeitures expected to occur or to account for forfeitures as a reduction to compensation cost when they occur. Upon adoption of ASU 2016-09, we did not change our policy of estimating participant forfeitures as a part of our calculations of share-based compensation cost. Income Taxes. In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory , which provides new guidance regarding when an entity should recognize the income tax consequences of certain intra-entity asset transfers. Prior to the adoption of ASU 2016-16, U.S. GAAP prohibited entities from recognizing the income tax consequences of intercompany asset transfers, including transfers of intellectual property. The seller deferred any net tax effect, and the buyer was prohibited from recognizing a deferred tax asset on the difference between the newly created tax basis of the asset in its tax jurisdiction and its financial statement carrying amount as reported in the consolidated financial statements. ASU 2016-16 requires entities to recognize these tax consequences in the period in which the transfer takes place, with the exception of inventory transfers . ASU 2016-16 is effective for the Company in the first quarter of 2018, with early adoption permitted in the first quarter of 2017. The standard requires the use of the modified retrospective (cumulative effect) transition approach. The Company adopted the standard early, in the first quarter of 2017. In connection with such adoption, we recorded a cumulative effect adjustment reducing prepaid expenses and other, other assets, and retained earnings within our condensed consolidated balance sheets by $8 million , $14 million , and $22 million , respectively. This cumulative effect adjustment includes recognition of the income tax consequences of intra-entity transfers of assets other than inventory that occurred prior to the adoption date. Prior periods were not retrospectively adjusted. Recently Issued Accounting Pronouncements Revenue Recognition. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP. The new standard introduces a five-step process to be followed in determining the amount and timing of revenue recognition. It also provides guidance on accounting for costs incurred to obtain or fulfill contracts with customers, and establishes disclosure requirements which are more extensive than those required under existing U.S. GAAP . The FASB has issued the following amendments to ASU 2014-09 from August 2015 through March 2017: • ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date • ASU 2016-08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Consideration (Reporting Revenue Gross versus Net) • ASU 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing • ASU 2016-12, Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients • ASU 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers Such amendments provide supplemental and clarifying guidance, as well as amend the effective date of the new standard. ASU 2014-09, as amended, is effective for the Company in the first quarter of 2018, with early adoption permitted in the first quarter of 2017. The standard permits the use of either the retrospective or modified retrospective (cumulative effect) transition method. In 2015, we formed a cross-functional implementation team and began our analysis of this new guidance. Such analysis includes assessment of the impact of the new guidance on our consolidated financial statements and related disclosures, as well as related impacts on processes, accounting systems, and internal controls. Based on our analysis to-date, we have reached the following tentative conclusions regarding this new guidance and how we expect it to impact our consolidated financial statements and related disclosures: • We expect to adopt this new guidance effective with our first quarter of 2018; we will not early adopt. • We expect to use the cumulative effect transition method. Such method provides that the cumulative effect from prior periods upon applying the new guidance is recognized in our consolidated balance sheets as of the date of adoption, including an adjustment to retained earnings. Prior periods will not be retrospectively adjusted. • We believe substantially all of our revenue falls within the scope of ASU 2014-09, as amended; substantially all of our revenue is contractual. • Generally, our subscription and content fees revenue is recognized ratably over the respective contract terms ("over time"). Upon adoption of the new guidance, we expect to recognize a license component of certain subscription and content fees revenue upon delivery to the customer ("point in time") and a non-license component (i.e. support) of such revenues over the respective contract terms ("over time"). At the date of adoption of this new guidance, we expect to record a cumulative adjustment to our consolidated balance sheet, including an adjustment to retained earnings, to adjust for the impact of certain prior period subscription and content fees revenue, as calculated under the new guidance. • We have determined the only significant incremental costs incurred to obtain contracts with customers within the scope of ASU 2014-09, as amended, are sales commissions paid to associates. Under current U.S. GAAP we recognize sales commissions as earned, and record such amounts as a component of total costs and expenses in our consolidated statements of operations. We recognized sales commission expense of $44 million , $45 million and $35 million in the 2016, 2015, and 2014 annual periods, respectively. Under the new guidance, we expect to record sales commissions as an asset, and amortize to expense over the related contract performance period. At the date of adoption of this new guidance, we expect to record an asset in our consolidated balance sheets for the amount of unamortized sales commissions for prior periods, as calculated under the new guidance. Such amount will subsequently be amortized to expense over the remaining performance periods of the related contracts with remaining performance obligations. Our analysis and evaluation of the new standard will continue through the effective date in the first quarter of 2018. A significant amount of work remains, due to the complexity of revenue recognition within our industry, the increased number of judgments and estimates required by this new guidance, and the volume of our contract portfolio which must be examined. We must quantify all impacts of this new guidance, including the topics discussed above, which may be material to our consolidated financial statements and related disclosures. We must also implement any necessary changes/modifications to processes, accounting systems, and internal controls. Financial Instruments. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities , which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 is effective for the Company in the first quarter of 2018, with early adoption permitted. We are currently evaluating the effect that ASU 2016-01 will have on our consolidated financial statements and related disclosures, and we have determined that we will not early adopt. Leases. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) , which introduces a new model that requires most leases to be reported on the balance sheet and aligns many of the underlying principles of the new lessor model with those in the new revenue recognition standard. ASU 2016-02 is effective for the Company in the first quarter of 2019, with early adoption permitted. We are currently evaluating the effect that ASU 2016-02 will have on our consolidated financial statements and related disclosures, and we have not determined if we will early adopt. Credit Losses on Financial Instruments. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which provides new guidance regarding the measurement and recognition of credit impairment for certain financial assets. Such guidance will impact how we determine our allowance for estimated uncollectible receivables and evaluate our available-for-sale investments for impairment. ASU 2016-13 is effective for the Company in the first quarter of 2020, with early adoption permitted in the first quarter of 2019. We are currently evaluating the effect that ASU 2016-13 will have on our consolidated financial statements and related disclosures, and we have not determined if we will early adopt . Callable Debt Securities. In March 2017, the FASB issued ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities , which shortens the amortization period for certain investments in callable debt securities purchased at a premium by requiring the premium be amortized to the earliest call date. Such guidance will impact how premiums are amortized on our available-for-sale investments. ASU 2017-08 is effective for the Company in the first quarter of 2019, with early adoption permitted. The standard requires the use of the modified retrospective (cumulative effect) transition approach. We are currently evaluating the effect that ASU 2017-08 will have on our consolidated financial statements and related disclosures, and have not determined if we will early adopt . |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Apr. 01, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We determine fair value measurements used in our consolidated financial statements based upon the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value hierarchy distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below: • Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the entity has the ability to access. • Level 2 – Valuations based on quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities. • Level 3 – Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The following table details our financial assets measured and recorded at fair value on a recurring basis at April 1, 2017 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 94,689 $ — $ — Time deposits Cash equivalents — 8,067 — Commercial paper Cash equivalents — 44,800 — Government and corporate bonds Cash equivalents — 500 — Time deposits Short-term investments — 29,538 — Commercial paper Short-term investments — 23,140 — Government and corporate bonds Short-term investments — 100,780 — Government and corporate bonds Long-term investments — 65,255 — The following table details our financial assets measured and recorded at fair value on a recurring basis at December 31, 2016 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 23,110 $ — $ — Time deposits Cash equivalents — 11,477 — Time deposits Short-term investments — 40,639 — Commercial paper Short-term investments — 22,301 — Government and corporate bonds Short-term investments — 122,648 — Government and corporate bonds Long-term investments — 95,368 — We estimate the fair value of our long-term, fixed rate debt using a Level 3 discounted cash flow analysis based on current borrowing rates for debt with similar maturities. We estimate the fair value of our long-term, variable rate debt using a Level 3 discounted cash flow analysis based on LIBOR rate forward curves. The fair value of our long-term debt, including current maturities, at April 1, 2017 and December 31, 2016 was approximately $512 million and $515 million , respectively. The carrying amount of such debt at both April 1, 2017 and December 31, 2016 was $500 million . |
Investments
Investments | 3 Months Ended |
Apr. 01, 2017 | |
Investments [Abstract] | |
Investments | Available-for-sale Investments Available-for-sale investments at April 1, 2017 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 94,689 $ — $ — $ 94,689 Time deposits 8,067 — — 8,067 Commercial paper 44,800 — — 44,800 Government and corporate bonds 500 — — 500 Total cash equivalents 148,056 — — 148,056 Short-term investments: Time deposits 29,538 — — 29,538 Commercial paper 23,175 — (35 ) 23,140 Government and corporate bonds 100,892 7 (119 ) 100,780 Total short-term investments 153,605 7 (154 ) 153,458 Long-term investments: Government and corporate bonds 65,472 — (217 ) 65,255 Total available-for-sale investments $ 367,133 $ 7 $ (371 ) $ 366,769 Available-for-sale investments at December 31, 2016 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 23,110 $ — $ — $ 23,110 Time deposits 11,477 — — 11,477 Total cash equivalents 34,587 — — 34,587 Short-term investments: Time deposits 40,639 — — 40,639 Commercial paper 22,325 — (24 ) 22,301 Government and corporate bonds 122,729 3 (84 ) 122,648 Total short-term investments 185,693 3 (108 ) 185,588 Long-term investments: Government and corporate bonds 95,806 — (438 ) 95,368 Total available-for-sale investments $ 316,086 $ 3 $ (546 ) $ 315,543 We sold available-for-sale investments for proceeds of $20 million during both the three months ended April 1, 2017 and April 2, 2016 , resulting in insignificant gains or losses. |
Receivables
Receivables | 3 Months Ended |
Apr. 01, 2017 | |
Receivables [Abstract] | |
Receivables | Receivables A summary of net receivables is as follows: (In thousands) April 1, 2017 December 31, 2016 Gross accounts receivable $ 1,015,120 $ 958,843 Less: Allowance for doubtful accounts 48,641 43,028 Accounts receivable, net of allowance 966,479 915,815 Current portion of lease receivables 19,875 29,128 Total receivables, net $ 986,354 $ 944,943 During the second quarter of 2008, Fujitsu Services Limited’s ("Fujitsu") contract as the prime contractor in the National Health Service ("NHS") initiative to automate clinical processes and digitize medical records in the Southern region of England was terminated by the NHS. This had the effect of automatically terminating our subcontract for the project. We continue to be in dispute with Fujitsu regarding Fujitsu’s obligation to pay the amounts comprised of accounts receivable and contracts receivable related to that subcontract, and we are working with Fujitsu to resolve these issues based on processes provided for in the contract. Part of that process requires final resolution of disputes between Fujitsu and the NHS regarding the contract termination. As of April 1, 2017 , it remains unlikely that our matter with Fujitsu will be resolved in the next 12 months. Therefore, these receivables have been classified as long-term and represent less than the majority of other long-term assets at April 1, 2017 and December 31, 2016 . While the ultimate collectability of the receivables pursuant to this process is uncertain, we believe that we have valid and equitable grounds for recovery of such amounts and that collection of recorded amounts is probable. Nevertheless, it is reasonably possible that our estimates regarding collectability of such amounts might materially change in the near term, considering that we do not have complete knowledge of the status of the proceedings between Fujitsu and NHS and their effect on our claim. During the first three months of both 2017 and 2016 , we received total client cash collections of $1.3 billion . |
Income Taxes
Income Taxes | 3 Months Ended |
Apr. 01, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes We determine the tax provision for interim periods using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter we update our estimate of the annual effective tax rate, and if our estimated tax rate changes, we make a cumulative adjustment. Our effective tax rate was 28.7% and 30.8% for the first three months of 2017 and 2016 , respectively. The decrease in the effective tax rate in 2017 is a result of the inclusion of net excess tax benefits as a discrete item within the tax provision, upon our adoption of ASU 2016-09 in the first quarter of 2017. Refer to Note (1) for further discussion regarding our adoption of ASU 2016-09 and its impact on our condensed consolidated financial statements. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Apr. 01, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share A reconciliation of the numerators and the denominators of the basic and diluted per share computations are as follows: Three Months Ended 2017 2016 Earnings Shares Per-Share Earnings Shares Per-Share (In thousands, except per share data) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic earnings per share: Income available to common shareholders $ 173,213 329,973 $ 0.52 $ 150,360 339,518 $ 0.44 Effect of dilutive securities: Stock options and non-vested shares — 6,217 — 6,382 Diluted earnings per share: Income available to common shareholders including assumed conversions $ 173,213 336,190 $ 0.52 $ 150,360 345,900 $ 0.43 For the three months ended April 1, 2017 and April 2, 2016 , options to purchase 10.6 million and 7.2 million shares of common stock at per share prices ranging from $44.05 to $73.40 and $44.05 to $73.40 , respectively, were outstanding but were not included in the computation of diluted earnings per share because they were anti-dilutive. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Apr. 01, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation and Equity | Share-Based Compensation Stock Options Stock option activity for the three months ended April 1, 2017 was as follows: (In thousands, except per share data) Number of Shares Weighted- Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Term (Yrs) Outstanding at beginning of year 23,601 $ 40.33 Granted 876 55.67 Exercised (882 ) 17.88 Forfeited and expired (206 ) 54.87 Outstanding as of April 1, 2017 23,389 41.62 $ 431,649 6.06 Exercisable as of April 1, 2017 12,376 $ 28.27 $ 381,943 4.21 The weighted-average assumptions used to estimate the fair value, under the Black-Scholes-Merton pricing model, of stock options granted during the three months ended April 1, 2017 were as follows: Expected volatility (%) 27.0 % Expected term (yrs) 7 Risk-free rate (%) 2.2 % Fair value per option $ 18.31 As of April 1, 2017 , there was $147 million of total unrecognized compensation cost related to stock options granted under all plans. That cost is expected to be recognized over a weighted-average period of 3.21 years. Non-vested Shares and Share Units Non-vested share and share unit activity for the three months ended April 1, 2017 was as follows: (In thousands, except per share data) Number of Shares Weighted-Average Grant Date Fair Value Outstanding at beginning of year 354 $ 61.12 Granted 20 55.74 Vested (12 ) 61.75 Forfeited (4 ) 52.37 Outstanding as of April 1, 2017 358 $ 60.88 As of April 1, 2017 , there was $7 million of total unrecognized compensation cost related to non-vested share awards granted under all plans. That cost is expected to be recognized over a weighted-average period of 1.74 years. Share-Based Compensation Cost The following table presents total compensation expense recognized with respect to stock options, non-vested shares and share units, and our associate stock purchase plan: Three Months Ended (In thousands) 2017 2016 Stock option and non-vested share and share unit compensation expense $ 17,500 $ 17,811 Associate stock purchase plan expense 1,475 1,756 Amounts capitalized in software development costs, net of amortization (120 ) (201 ) Amounts charged against earnings, before income tax benefit $ 18,855 $ 19,366 Amount of related income tax benefit recognized in earnings $ 5,416 $ 5,955 |
Contingencies
Contingencies | 3 Months Ended |
Apr. 01, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies Disclosure | Contingencies We accrue estimates for resolution of any legal and other contingencies when losses are probable and estimable, in accordance with Accounting Standards Codification Topic 450, Contingencies . The terms of our software license agreements with our clients generally provide for a limited indemnification of such clients against losses, expenses and liabilities arising from third party claims based on alleged infringement by our solutions of an intellectual property right of such third party. The terms of such indemnification often limit the scope of and remedies for such indemnification obligations and generally include a right to replace or modify an infringing solution. To date, we have not had to reimburse any of our clients for any judgments or settlements to third parties related to these indemnification provisions pertaining to intellectual property infringement claims. For several reasons, including the lack of a sufficient number of prior indemnification claims and the lack of a monetary liability limit for certain infringement cases under the terms of the corresponding agreements with our clients, we cannot determine the maximum amount of potential future payments, if any, related to such indemnification provisions. In addition to commitments and obligations in the ordinary course of business, we are subject to various legal proceedings and claims that arise in the ordinary course of business, including for example, employment and client disputes and litigation alleging solution and implementation defects, personal injury, intellectual property infringement, violations of law and breaches of contract and warranties. In addition, we are a defendant in lawsuits filed in federal and state courts brought as putative class or collective actions on behalf of various groups of current and former associates in the U.S alleging that we misclassified associates as exempt from overtime pay under the Fair Labor Standards Act and state wage and hour laws. These proceedings are at various procedural stages (for example one case is newly filed while two cases have classes certified) and seek unspecified monetary damages, injunctive relief, costs and attorneys’ fees. Given the substantial uncertainties, such as the impact of discovery and the extent to which significant factual issues are resolved, the disposition of pre-trial motions, the extent of potential damages, which are often unspecified or indeterminate, and the status of settlement discussions (if any), we cannot predict with any reasonable certainty the timing or outcome of such contingencies. At this time, we do not believe any material losses under these claims to be probable or estimable. No less than quarterly, we review the status of each significant matter and assess our potential financial exposure. We accrue a liability for an estimated loss if the potential loss from any legal proceeding or claim is considered probable and the amount can be reasonably estimated. Significant judgment is required in both the determination of probability and the determination as to whether the amount of an exposure is reasonably estimable, and accruals are based only on the information available to our management at the time the judgment is made. Furthermore, the outcome of legal proceedings is inherently uncertain, and we may incur substantial defense costs and expenses defending any of these matters. Should any one or a combination of more than one of these proceedings be successful, or should we determine to settle any one or a combination of these matters, we may be required to pay substantial sums, become subject to the entry of an injunction or be forced to change the manner in which we operate our business, which could have a material adverse impact on our business, results of operations, cash flows or financial condition. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Apr. 01, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting | Segment Reporting We have two operating segments, Domestic and Global. Revenues are derived primarily from the sale of clinical, financial and administrative information systems and solutions. The cost of revenues includes the cost of third party consulting services, computer hardware, devices and sublicensed software purchased from manufacturers for delivery to clients. It also includes the cost of hardware maintenance and sublicensed software support subcontracted to the manufacturers. Operating expenses incurred by the geographic business segments consist of sales and client service expenses including salaries of sales and client service personnel, expenses associated with our managed services business, marketing expenses, communications expenses and unreimbursed travel expenses. "Other" includes expenses that have not been allocated to the operating segments, such as software development, general and administrative expenses, acquisition costs and related adjustments, share-based compensation expense, and certain amortization and depreciation. Performance of the segments is assessed at the operating earnings level by our chief operating decision maker, who is our Chief Executive Officer. Items such as interest, income taxes, capital expenditures and total assets are managed at the consolidated level and thus are not included in our operating segment disclosures. Accounting policies for each of the reportable segments are the same as those used on a consolidated basis. The following table presents a summary of our operating segments and other expense for the three months ended April 1, 2017 and April 2, 2016 : (In thousands) Domestic Global Other Total Three Months Ended 2017 Revenues $ 1,131,804 $ 128,682 $ — $ 1,260,486 Cost of revenues 176,361 22,632 — 198,993 Operating expenses 483,380 63,523 270,464 817,367 Total costs and expenses 659,741 86,155 270,464 1,016,360 Operating earnings (loss) $ 472,063 $ 42,527 $ (270,464 ) $ 244,126 (In thousands) Domestic Global Other Total Three Months Ended 2016 Revenues $ 1,004,965 $ 133,170 $ — $ 1,138,135 Cost of revenues 149,269 26,324 — 175,593 Operating expenses 425,559 58,871 262,664 747,094 Total costs and expenses 574,828 85,195 262,664 922,687 Operating earnings (loss) $ 430,137 $ 47,975 $ (262,664 ) $ 215,448 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Apr. 01, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table details our financial assets measured and recorded at fair value on a recurring basis at April 1, 2017 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 94,689 $ — $ — Time deposits Cash equivalents — 8,067 — Commercial paper Cash equivalents — 44,800 — Government and corporate bonds Cash equivalents — 500 — Time deposits Short-term investments — 29,538 — Commercial paper Short-term investments — 23,140 — Government and corporate bonds Short-term investments — 100,780 — Government and corporate bonds Long-term investments — 65,255 — The following table details our financial assets measured and recorded at fair value on a recurring basis at December 31, 2016 : (In thousands) Fair Value Measurements Using Description Balance Sheet Classification Level 1 Level 2 Level 3 Money market funds Cash equivalents $ 23,110 $ — $ — Time deposits Cash equivalents — 11,477 — Time deposits Short-term investments — 40,639 — Commercial paper Short-term investments — 22,301 — Government and corporate bonds Short-term investments — 122,648 — Government and corporate bonds Long-term investments — 95,368 — |
Investments Investments (Tables
Investments Investments (Tables) | 3 Months Ended |
Apr. 01, 2017 | |
Investments [Abstract] | |
Schedule of available-for-sale investments | Available-for-sale investments at April 1, 2017 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 94,689 $ — $ — $ 94,689 Time deposits 8,067 — — 8,067 Commercial paper 44,800 — — 44,800 Government and corporate bonds 500 — — 500 Total cash equivalents 148,056 — — 148,056 Short-term investments: Time deposits 29,538 — — 29,538 Commercial paper 23,175 — (35 ) 23,140 Government and corporate bonds 100,892 7 (119 ) 100,780 Total short-term investments 153,605 7 (154 ) 153,458 Long-term investments: Government and corporate bonds 65,472 — (217 ) 65,255 Total available-for-sale investments $ 367,133 $ 7 $ (371 ) $ 366,769 Available-for-sale investments at December 31, 2016 were as follows: (In thousands) Adjusted Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Cash equivalents: Money market funds $ 23,110 $ — $ — $ 23,110 Time deposits 11,477 — — 11,477 Total cash equivalents 34,587 — — 34,587 Short-term investments: Time deposits 40,639 — — 40,639 Commercial paper 22,325 — (24 ) 22,301 Government and corporate bonds 122,729 3 (84 ) 122,648 Total short-term investments 185,693 3 (108 ) 185,588 Long-term investments: Government and corporate bonds 95,806 — (438 ) 95,368 Total available-for-sale investments $ 316,086 $ 3 $ (546 ) $ 315,543 |
Receivables (Tables)
Receivables (Tables) | 3 Months Ended |
Apr. 01, 2017 | |
Receivables [Abstract] | |
Summary of Net Receivables | A summary of net receivables is as follows: (In thousands) April 1, 2017 December 31, 2016 Gross accounts receivable $ 1,015,120 $ 958,843 Less: Allowance for doubtful accounts 48,641 43,028 Accounts receivable, net of allowance 966,479 915,815 Current portion of lease receivables 19,875 29,128 Total receivables, net $ 986,354 $ 944,943 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Apr. 01, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation Of The Numerators And The Denominators Of The Basic And Diluted Per Share | A reconciliation of the numerators and the denominators of the basic and diluted per share computations are as follows: Three Months Ended 2017 2016 Earnings Shares Per-Share Earnings Shares Per-Share (In thousands, except per share data) (Numerator) (Denominator) Amount (Numerator) (Denominator) Amount Basic earnings per share: Income available to common shareholders $ 173,213 329,973 $ 0.52 $ 150,360 339,518 $ 0.44 Effect of dilutive securities: Stock options and non-vested shares — 6,217 — 6,382 Diluted earnings per share: Income available to common shareholders including assumed conversions $ 173,213 336,190 $ 0.52 $ 150,360 345,900 $ 0.43 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Apr. 01, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule Of Stock Options Activity | Stock option activity for the three months ended April 1, 2017 was as follows: (In thousands, except per share data) Number of Shares Weighted- Average Exercise Price Aggregate Intrinsic Value Weighted-Average Remaining Contractual Term (Yrs) Outstanding at beginning of year 23,601 $ 40.33 Granted 876 55.67 Exercised (882 ) 17.88 Forfeited and expired (206 ) 54.87 Outstanding as of April 1, 2017 23,389 41.62 $ 431,649 6.06 Exercisable as of April 1, 2017 12,376 $ 28.27 $ 381,943 4.21 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The weighted-average assumptions used to estimate the fair value, under the Black-Scholes-Merton pricing model, of stock options granted during the three months ended April 1, 2017 were as follows: Expected volatility (%) 27.0 % Expected term (yrs) 7 Risk-free rate (%) 2.2 % Fair value per option $ 18.31 |
Schedule of Share-based Compensation, Restricted Stock Activity | Non-vested share and share unit activity for the three months ended April 1, 2017 was as follows: (In thousands, except per share data) Number of Shares Weighted-Average Grant Date Fair Value Outstanding at beginning of year 354 $ 61.12 Granted 20 55.74 Vested (12 ) 61.75 Forfeited (4 ) 52.37 Outstanding as of April 1, 2017 358 $ 60.88 |
Compensation Expense Recognized In The Condensed Consolidated Statements Of Operations | The following table presents total compensation expense recognized with respect to stock options, non-vested shares and share units, and our associate stock purchase plan: Three Months Ended (In thousands) 2017 2016 Stock option and non-vested share and share unit compensation expense $ 17,500 $ 17,811 Associate stock purchase plan expense 1,475 1,756 Amounts capitalized in software development costs, net of amortization (120 ) (201 ) Amounts charged against earnings, before income tax benefit $ 18,855 $ 19,366 Amount of related income tax benefit recognized in earnings $ 5,416 $ 5,955 |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Apr. 01, 2017 | |
Segment Reporting [Abstract] | |
Summary of the Operating Information | The following table presents a summary of our operating segments and other expense for the three months ended April 1, 2017 and April 2, 2016 : (In thousands) Domestic Global Other Total Three Months Ended 2017 Revenues $ 1,131,804 $ 128,682 $ — $ 1,260,486 Cost of revenues 176,361 22,632 — 198,993 Operating expenses 483,380 63,523 270,464 817,367 Total costs and expenses 659,741 86,155 270,464 1,016,360 Operating earnings (loss) $ 472,063 $ 42,527 $ (270,464 ) $ 244,126 (In thousands) Domestic Global Other Total Three Months Ended 2016 Revenues $ 1,004,965 $ 133,170 $ — $ 1,138,135 Cost of revenues 149,269 26,324 — 175,593 Operating expenses 425,559 58,871 262,664 747,094 Total costs and expenses 574,828 85,195 262,664 922,687 Operating earnings (loss) $ 430,137 $ 47,975 $ (262,664 ) $ 215,448 |
Interim Statement Presentatio24
Interim Statement Presentation Policies (Details) - USD ($) shares in Millions | 3 Months Ended | 12 Months Ended | ||||
Apr. 01, 2017 | Apr. 02, 2016 | Dec. 30, 2017 | Dec. 31, 2016 | Jan. 02, 2016 | Jan. 03, 2015 | |
Interim Statement Presentation [Line Items] | ||||||
Basis of Accounting, Policy [Policy Text Block] | The condensed consolidated financial statements were prepared using GAAP | |||||
Use of Estimates, Policy [Policy Text Block] | These principles require us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses | |||||
Fiscal Period, Policy [Policy Text Block] | Our first fiscal quarter ends on the Saturday closest to March 31. The 2017 and 2016 first quarters ended on April 1, 2017 and April 2, 2016, respectively. All references to years in these notes to condensed consolidated financial statements represent the respective three months ended on such dates, unless otherwise noted. | |||||
Adjustments to Additional Paid in Capital, Income Tax Benefit from Share-based Compensation | $ 9,000,000 | |||||
Diluted earnings per share calculation, assumed share repurchases from excess tax benefit | 2.2 | |||||
Sales Commissions and Fees | $ 44,000,000 | $ 45,000,000 | $ 35,000,000 | |||
ASU 2016-09 Share-Based Compensation [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Name | Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting | |||||
New Accounting Pronouncement or Change in Accounting Principle, Description | ASU 2016-09 impacts several aspects of the accounting for share-based payment award transactions, including: (1) accounting and cash flow classification for excess tax benefits and deficiencies, (2) forfeitures, and (3) tax withholding requirements and cash flow classification | |||||
ASU 2016-16 Income Taxes [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Name | ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other than Inventory | |||||
New Accounting Pronouncement or Change in Accounting Principle, Description | provides new guidance regarding when an entity should recognize the income tax consequences of certain intra-entity asset transfers. Prior to the adoption of ASU 2016-16, U.S. GAAP prohibited entities from recognizing the income tax consequences of intercompany asset transfers, including transfers of intellectual property. The seller deferred any net tax effect, and the buyer was prohibited from recognizing a deferred tax asset on the difference between the newly created tax basis of the asset in its tax jurisdiction and its financial statement carrying amount as reported in the consolidated financial statements. ASU 2016-16 requires entities to recognize these tax consequences in the period in which the transfer takes place, with the exception of inventory transfers | |||||
Revenue from Contracts with Customers [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606), which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP. The new standard introduces a five-step process to be followed in determining the amount and timing of revenue recognition. It also provides guidance on accounting for costs incurred to obtain or fulfill contracts with customers, and establishes disclosure requirements which are more extensive than those required under existing U.S. GAAP | |||||
ASU 2016-01 Financial Instruments [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, which addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. ASU 2016-01 is effective for the Company in the first quarter of 2018, with early adoption permitted. We are currently evaluating the effect that ASU 2016-01 will have on our consolidated financial statements and related disclosures, and we have determined that we will not early adopt. | |||||
ASU 2016-02 Leases [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which introduces a new model that requires most leases to be reported on the balance sheet and aligns many of the underlying principles of the new lessor model with those in the new revenue recognition standard. ASU 2016-02 is effective for the Company in the first quarter of 2019, with early adoption permitted. We are currently evaluating the effect that ASU 2016-02 will have on our consolidated financial statements and related disclosures, and we have not determined if we will early adopt. | |||||
ASU 2016-13 Credit Losses [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which provides new guidance regarding the measurement and recognition of credit impairment for certain financial assets. Such guidance will impact how we determine our allowance for estimated uncollectible receivables and evaluate our available-for-sale investments for impairment. ASU 2016-13 is effective for the Company in the first quarter of 2020, with early adoption permitted in the first quarter of 2019. We are currently evaluating the effect that ASU 2016-13 will have on our consolidated financial statements and related disclosures, and we have not determined if we will early adopt | |||||
ASU 2017-08 Callable Debt Securities [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
Description of New Accounting Pronouncements Not yet Adopted [Text Block] | In March 2017, the FASB issued ASU 2017-08, Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities, which shortens the amortization period for certain investments in callable debt securities purchased at a premium by requiring the premium be amortized to the earliest call date. Such guidance will impact how premiums are amortized on our available-for-sale investments. ASU 2017-08 is effective for the Company in the first quarter of 2019, with early adoption permitted. The standard requires the use of the modified retrospective (cumulative effect) transition approach. We are currently evaluating the effect that ASU 2017-08 will have on our consolidated financial statements and related disclosures, and have not determined if we will early adopt | |||||
Net earnings [Member] | ASU 2016-09 Share-Based Compensation [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | $ 8,000,000 | |||||
Diluted earnings per share [Member] | ASU 2016-09 Share-Based Compensation [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 0.02 | |||||
Minimum [Member] | Estimate impact on dilute earnings per share [Member] | ASU 2016-09 Share-Based Compensation [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | $ 0.01 | |||||
Maximum [Member] | Estimate impact on dilute earnings per share [Member] | ASU 2016-09 Share-Based Compensation [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | $ 0.02 | |||||
Prepaid Expenses and Other Current Assets [Member] | ASU 2016-16 Income Taxes [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 8,000,000 | |||||
Other Assets [Member] | ASU 2016-16 Income Taxes [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | 14,000,000 | |||||
Retained Earnings [Member] | ASU 2016-16 Income Taxes [Member] | ||||||
Interim Statement Presentation [Line Items] | ||||||
New Accounting Pronouncement or Change in Accounting Principle, Effect of Adoption, Quantification | $ 22,000,000 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Dec. 31, 2016 |
Fair Value Disclosures [Abstract] | ||
Fair value of long-term debt, including current maturities | $ 512 | $ 515 |
Carrying amount of long-term debt | $ 500 |
Fair Value Measurements Fair Va
Fair Value Measurements Fair Value, Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Dec. 31, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | $ 366,769 | $ 315,543 |
Level 1 [Member] | Money market funds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 94,689 | 23,110 |
Level 2 [Member] | Time deposits [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 8,067 | 11,477 |
Level 2 [Member] | Commercial paper [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 44,800 | |
Level 2 [Member] | Government and corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash and Cash Equivalents, Fair Value Disclosure | 500 | |
Short-term investments [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 153,458 | 185,588 |
Short-term investments [Member] | Level 2 [Member] | Time deposits [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 29,538 | 40,639 |
Short-term investments [Member] | Level 2 [Member] | Commercial paper [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 23,140 | 22,301 |
Short-term investments [Member] | Level 2 [Member] | Government and corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | 100,780 | 122,648 |
Long-term investments [Member] | Level 2 [Member] | Government and corporate bonds [Member] | Fair Value, Measurements, Recurring [Member] | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available-for-sale Securities, Fair Value Disclosure | $ 65,255 | $ 95,368 |
Investments (Narrative) (Detail
Investments (Narrative) (Details) $ in Millions | 3 Months Ended |
Apr. 01, 2017USD ($) | |
Investments [Abstract] | |
Proceeds from sale of available-for-sale securities | $ 20 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Dec. 31, 2016 |
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | $ 367,133 | $ 316,086 |
Gross Unrealized Gains | 7 | 3 |
Gross Unrealized Losses | (371) | (546) |
Fair Value | 366,769 | 315,543 |
Cash equivalents [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 148,056 | 34,587 |
Fair Value | 148,056 | 34,587 |
Cash equivalents [Member] | Money market funds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 94,689 | 23,110 |
Fair Value | 94,689 | 23,110 |
Cash equivalents [Member] | Time deposits [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 8,067 | 11,477 |
Fair Value | 8,067 | 11,477 |
Cash equivalents [Member] | Commercial paper [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 44,800 | |
Fair Value | 44,800 | |
Cash equivalents [Member] | Government and corporate bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 500 | |
Fair Value | 500 | |
Short-term investments [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 153,605 | 185,693 |
Gross Unrealized Gains | 7 | 3 |
Gross Unrealized Losses | (154) | (108) |
Fair Value | 153,458 | 185,588 |
Short-term investments [Member] | Time deposits [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 29,538 | 40,639 |
Fair Value | 29,538 | 40,639 |
Short-term investments [Member] | Commercial paper [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 23,175 | 22,325 |
Gross Unrealized Losses | (35) | (24) |
Fair Value | 23,140 | 22,301 |
Short-term investments [Member] | Government and corporate bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 100,892 | 122,729 |
Gross Unrealized Gains | 7 | 3 |
Gross Unrealized Losses | (119) | (84) |
Fair Value | 100,780 | 122,648 |
Long-term investments [Member] | Government and corporate bonds [Member] | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Adjusted Cost | 65,472 | 95,806 |
Gross Unrealized Losses | (217) | (438) |
Fair Value | $ 65,255 | $ 95,368 |
Receivables (Narrative) (Detail
Receivables (Narrative) (Details) $ in Billions | 3 Months Ended |
Apr. 01, 2017USD ($) | |
Receivables [Abstract] | |
Client cash collections | $ 1.3 |
Receivables (Summary Of Net Rec
Receivables (Summary Of Net Receivables) (Details) - USD ($) $ in Thousands | Apr. 01, 2017 | Dec. 31, 2016 |
Receivables [Abstract] | ||
Gross accounts receivable | $ 1,015,120 | $ 958,843 |
Less: Allowance for doubtful accounts | 48,641 | 43,028 |
Accounts receivable, net of allowance | 966,479 | 915,815 |
Current portion of lease receivables | 19,875 | 29,128 |
Total receivables, net | $ 986,354 | $ 944,943 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate | 28.70% | 30.80% |
Earnings Per Share (Reconciliat
Earnings Per Share (Reconciliation Of The Numerators And The Denominators Of The Basic And Diluted Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Earnings Per Share [Abstract] | ||
Income available to common shareholders, basic | $ 173,213 | $ 150,360 |
Income available to common shareholders including assumed conversions, diluted | $ 173,213 | $ 150,360 |
Basic weighted average shares outstanding | 329,973 | 339,518 |
Stock options and non-vested shares, incremental shares | 6,217 | 6,382 |
Diluted weighted average shares outstanding | 336,190 | 345,900 |
Basic earnings per share | $ 0.52 | $ 0.44 |
Diluted earnings per share | $ 0.52 | $ 0.43 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - $ / shares shares in Millions | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Earnings Per Share [Abstract] | ||
Antidilutive securities excluded from computation of earnings per share, amount | 10.6 | 7.2 |
Antidilutive securities excluded from computation of earnings per share, exercise price, lower range limit | $ 44.05 | $ 44.05 |
Antidilutive securities excluded from computation of earnings per share, exercise price, upper range limit | $ 73.40 | $ 73.40 |
Share-Based Compensation (Sched
Share-Based Compensation (Schedule Of Stock Options Activity) (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended |
Apr. 01, 2017USD ($)$ / sharesshares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Outstanding at beginning of year, number of shares | shares | 23,601 |
Outstanding at beginning of year, weighted-average exercise price | $ / shares | $ 40.33 |
Granted, number of shares | shares | 876 |
Granted, weighted-average exercise price | $ / shares | $ 55.67 |
Exercised, number of shares | shares | (882) |
Exercised, weighted-average exercise price | $ / shares | $ 17.88 |
Forfeited and expired, number of shares | shares | (206) |
Forfeited and expired, weighted-average exercise price | $ / shares | $ 54.87 |
Outstanding end of year, number of shares | shares | 23,389 |
Outstanding at end of year, weighted-average exercise price | $ / shares | $ 41.62 |
Outstanding at end of year, aggregate intrinsic value | $ | $ 431,649 |
Outstanding at end of year, weighted-average remaining contractual term | 6 years 22 days |
Exercisable at end of year, number of shares | shares | 12,376 |
Exercisable at end of year, weighted-average exercise price | $ / shares | $ 28.27 |
Exercisable at end of year, aggregate intrinsic value | $ | $ 381,943 |
Exercisable at end of year, weighted-average remaining contractual term | 4 years 2 months 16 days |
Share-Based Compensation (Sch35
Share-Based Compensation (Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions) (Details) | 3 Months Ended |
Apr. 01, 2017$ / shares | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Expected volatility (%) | 27.00% |
Expected term (yrs) | 7 years |
Risk-free rate (%) | 2.20% |
Fair value per option | $ 18.31 |
Share-Based Compensation (Sch36
Share-Based Compensation (Schedule Of Non-Vested Shares Activity) (Details) - Restricted Stock [Member] shares in Thousands | 3 Months Ended |
Apr. 01, 2017$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding at beginning of year, number of shares | shares | 354 |
Outstanding at beginning of year, weighted-average grant date fair value | $ / shares | $ 61.12 |
Granted, number of shares | shares | 20 |
Granted, weighted-average grant date fair value | $ / shares | $ 55.74 |
Vested, number of shares | shares | (12) |
Vested, weighted-average grant date fair value | $ / shares | $ 61.75 |
Forfeited, number of shares | shares | (4) |
Forfeited, weighted-average grant date fair value | $ / shares | $ 52.37 |
Outstanding at end of year, number of shares | shares | 358 |
Outstanding at end of year, weighted-average grant date fair value | $ / shares | $ 60.88 |
Share-Based Compensation (Compe
Share-Based Compensation (Compensation Expense Recognized In The Condensed Consolidated Statements Of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Amounts charged against earnings, before income tax benefit | $ 18,855 | $ 19,366 |
Amount of related income tax benefit recognized in earnings | 5,416 | 5,955 |
Stock option and non-vested share compensation expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Amounts charged against earnings, before income tax benefit | 17,500 | 17,811 |
Associate stock purchase plan expense | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Amounts charged against earnings, before income tax benefit | 1,475 | 1,756 |
Amounts capitalized in software development costs, net of amortization | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Amounts charged against earnings, before income tax benefit | $ (120) | $ (201) |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) $ in Millions | 3 Months Ended |
Apr. 01, 2017USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Share-based Awards Other than Options | $ 7 |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Stock Options | $ 147 |
Stock Options [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Period of recognition for remaining share-based compensation expense | 3 years 2 months 16 days |
Restricted Stock [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Period of recognition for remaining share-based compensation expense | 1 year 8 months 28 days |
Segment Reporting (Summary Of T
Segment Reporting (Summary Of The Operating Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Segment Reporting Information [Line Items] | ||
Revenue | $ 1,260,486 | $ 1,138,135 |
Cost of revenues | 198,993 | 175,593 |
Operating expenses | 817,367 | 747,094 |
Total costs and expenses | 1,016,360 | 922,687 |
Operating earnings (loss) | 244,126 | 215,448 |
Domestic Segment | ||
Segment Reporting Information [Line Items] | ||
Revenue | 1,131,804 | 1,004,965 |
Cost of revenues | 176,361 | 149,269 |
Operating expenses | 483,380 | 425,559 |
Total costs and expenses | 659,741 | 574,828 |
Operating earnings (loss) | 472,063 | 430,137 |
Global Segment | ||
Segment Reporting Information [Line Items] | ||
Revenue | 128,682 | 133,170 |
Cost of revenues | 22,632 | 26,324 |
Operating expenses | 63,523 | 58,871 |
Total costs and expenses | 86,155 | 85,195 |
Operating earnings (loss) | 42,527 | 47,975 |
Other | ||
Segment Reporting Information [Line Items] | ||
Operating expenses | 270,464 | 262,664 |
Total costs and expenses | 270,464 | 262,664 |
Operating earnings (loss) | $ (270,464) | $ (262,664) |