Item 15. Exhibits, Financial Statement Schedules

Upon written request, we will provide, without charge, a copy of this annual report, including the Consolidated Financial Statements and financial statement schedule. All requests should be sent to:

Symantec Corporation

Attn: Investor Relations

350 Ellis Street

Mountain View, California 94043

(650) 527-8000

The following documents are filed as part of this report:

		Page
1.	Consolidated Financial Statements:
	Report of Independent Registered Public Accounting Firm	41
	Consolidated Balance Sheets	42
	Consolidated Statements of Operations	43
	Consolidated Statements of Comprehensive Income	44
	Consolidated Statements of Stockholders’ Equity	45
	Consolidated Statements of Cash Flows	46
	Notes to the Consolidated Financial Statements	47
	Basis of Presentation
	Note 1. Summary of Significant Accounting Policies	47
	Performance & Operations
	Note 2. Segment and Geographic Information	52
	Note 3. Net Income Per Share	54
	Note 4. Restructuring, Separation, Transition, and Other Costs	54
	Note 5. Income Taxes	55
	Non-Current Assets & Debt
	Note 6. Acquisitions	58
	Note 7. Goodwill and Intangible Assets	61
	Note 8. Debt	62
	Note 9. Fair Value Measurements	65
	Equity & Other
	Note 10. Stockholders' Equity	65
	Note 11. Stock-Based Compensation	67
	Note 12. Commitments and Contingencies	69
	Note 13. Discontinued Operations	71
	Note 14. Subsequent Events	72
	Financial statement schedules have been omitted since they are either not required, not applicable, or the information is otherwise included.
2.	Exhibits: The information required by this Item is set forth in the Exhibit Index that follows the signature page of this Annual Report.	74

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors and Stockholders

Symantec Corporation:

We have audited the accompanying consolidated balance sheets of Symantec Corporation and subsidiaries as of March 31, 2017 and April 1, 2016, and the related consolidated statements of operations, comprehensive income (loss), stockholders’ equity, and cash flows for each of the years in the three-year period ended March 31, 2017. We also have audited Symantec Corporation’s internal control over financial reporting as of March 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Symantec Corporation’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A.b). Our responsibility is to express an opinion on these consolidated financial statements and an opinion on Symantec Corporation’s internal control over financial reporting based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Symantec Corporation and subsidiaries as of March 31, 2017 and April 1, 2016, and the results of their operations and their cash flows for each of the years in the three-year period ended March 31, 2017, in conformity with U.S. generally accepted accounting principles. Also in our opinion, Symantec Corporation maintained, in all material respects, effective internal control over financial reporting as of March 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Symantec Corporation acquired Blue Coat, Inc. (Blue Coat) and LifeLock, Inc. (LifeLock), in August 2016 and February 2017, respectively, as discussed in Note 6 to the Consolidated Financial Statements. Management excluded from its assessment of the effectiveness of Symantec Corporation’s internal control over financial reporting as of March 31, 2017, Blue Coat’s internal control over financial reporting associated with consolidated total assets of approximately 4% and total consolidated revenues of approximately 11% and LifeLock’s internal control over financial reporting associated with consolidated total assets of approximately 2% and consolidated revenues of approximately 2%, included in the consolidated financial statements of Symantec Corporation and subsidiaries as of and for the year ended March 31, 2017. Our audit of internal control over financial reporting of Symantec Corporation also excluded an evaluation of the internal control over financial reporting of Blue Coat and LifeLock.

/s/ KPMG LLP

Santa Clara, California

May 19, 2017

SYMANTEC CORPORATION

CONSOLIDATED BALANCE SHEETS

(In millions, except per share amounts which are reflected in thousands, and par value per share amounts)

	March 31, 2017				April 1, 2016
ASSETS
Current assets:
Cash and cash equivalents	$	4,247			$	5,983
Accounts receivable, net	649				556
Other current assets	428				420
Total current assets	5,324				6,959
Property and equipment, net	937				957
Intangible assets, net	3,004				443
Goodwill	8,627				3,148
Equity investments	158				157
Other long-term assets	124				103
Total assets	$	18,174			$	11,767
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	180			$	175
Accrued compensation and benefits	272				219
Current portion of long-term debt	1,310				—
Deferred revenue	2,353				2,279
Income taxes payable	30				941
Other current liabilities	477				419
Total current liabilities	4,622				4,033
Long-term debt	6,876				2,207
Long-term deferred revenue	434				359
Long-term deferred tax liabilities	2,401				1,235
Long-term income taxes payable	251				160
Other long-term obligations	103				97
Total liabilities	14,687				8,091
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value: 1,000 shares authorized; 21 shares issued; 0 outstanding	—				—
Common stock and additional paid-in capital, $0.01 par value: 3,000,000 shares authorized; 608,019 and 612,266 shares issued and outstanding	4,236				4,309
Accumulated other comprehensive income	12				22
Accumulated deficit	(761		)		(655		)
Total stockholders’ equity	3,487				3,676
Total liabilities and stockholders’ equity	$	18,174			$	11,767

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

SYMANTEC CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share amounts)

	Year Ended
	March 31, 2017				April 1, 2016				April 3, 2015
Net revenues	$	4,019			$	3,600			$	3,956
Cost of revenues	853				615				727
Gross profit	3,166				2,985				3,229
Operating expenses:
Sales and marketing	1,459				1,292				1,650
Research and development	823				748				812
General and administrative	564				295				362
Amortization of intangible assets	147				57				87
Restructuring, separation, transition, and other	273				136				164
Total operating expenses	3,266				2,528				3,075
Operating income (loss)	(100		)		457				154
Interest income	21				10				11
Interest expense	(208		)		(75		)		(78		)
Other income, net	25				—				14
Income (loss) from continuing operations before income taxes	(262		)		392				101
Income tax expense (benefit)	(26		)		1,213				(8		)
Income (loss) from continuing operations	(236		)		(821		)		109
Income from discontinued operations, net of income taxes	130				3,309				769
Net income (loss)	$	(106	)		$	2,488			$	878
Income (loss) per share - basic:
Continuing operations	$	(0.38	)		$	(1.23	)		$	0.16
Discontinued operations	$	0.21			$	4.94			$	1.12
Net income (loss) per share - basic	$	(0.17	)		$	3.71			$	1.27
Income (loss) per share - diluted:
Continuing operations	$	(0.38	)		$	(1.23	)		$	0.16
Discontinued operations	$	0.21			$	4.94			$	1.10
Net income (loss) per share - diluted	$	(0.17	)		$	3.71			$	1.26
Weighted-average shares outstanding:
Basic	618				670				689
Diluted	618				670				696
Cash dividends declared per common share	$	0.30			$	4.60			$	0.60

Note: Net income per share amounts may not add due to rounding.

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

SYMANTEC CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In millions)

	Year Ended
	March 31, 2017				April 1, 2016				April 3, 2015
Net income (loss)	$	(106	)		$	2,488			$	878
Other comprehensive loss, net of taxes:
Foreign currency translation adjustments:
Translation adjustments	(8		)		(6		)		(89		)
Reclassification adjustments for (gain) loss included in net income (loss)	—				1				(1		)
Net foreign currency translation adjustments	(8		)		(5		)		(90		)
Unrealized gain (loss) on available-for-sale securities	(2		)		4				—
Other comprehensive loss, net of taxes	(10		)		(1		)		(90		)
Comprehensive income (loss)	$	(116	)		$	2,487			$	788

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

SYMANTEC CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In millions)

	Year ended
	March 31, 2017				April 1, 2016				April 3, 2015
Common stock and additional paid-in capital
Balance, beginning of period	$	4,309			$	6,101			$	6,751
Stock-based compensation	410				245				198
Assumed equity awards in acquisitions	112				—				—
Common stock issued under employee stock plans	95				65				116
Direct stock purchase	43				—				—
Equity component of convertible notes, net of tax	12				29				—
Income tax benefit from employee stock transactions	11				17				11
Repurchases of common stock	(500		)		(1,868		)		(500		)
Dividends paid and accrued	(191		)		(212		)		(428		)
Tax payments related to restricted stock units	(65		)		(68		)		(47		)
Balance, end of period	$	4,236			$	4,309			$	6,101
Accumulated deficit
Balance, beginning of period	$	(655	)		$	(270	)		$	(1,148	)
Net income (loss)	(106		)		2,488				878
Dividends paid and accrued	—				(2,873		)		—
Balance, end of period	$	(761	)		$	(655	)		$	(270	)
Accumulated other comprehensive income
Balance, beginning of period	$	22			$	104			$	194
Other comprehensive loss, net of taxes	(10		)		(1		)		(90		)
Sale of Veritas	—				(81		)		—
Balance, end of period	$	12			$	22			$	104
Total stockholders’ equity	$	3,487			$	3,676			$	5,935

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

SYMANTEC CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

	Year Ended
	March 31, 2017				April 1, 2016				April 3, 2015
OPERATING ACTIVITIES:
Net income (loss)	$	(106	)		$	2,488			$	878
Income from discontinued operations, net of income taxes	(130		)		(3,309		)		(769		)
Adjustments to continuing operating activities:
Depreciation and amortization	530				304				355
Stock-based compensation expense	440				161				131
Deferred income taxes	(168		)		1,082				(29		)
Other	32				7				(2		)
Changes in operating assets and liabilities, net of acquisitions
Accounts receivable, net	45				38				(35		)
Accounts payable	(67		)		(69		)		(73		)
Accrued compensation and benefits	20				(7		)		7
Deferred revenue	125				20				(83		)
Income taxes payable	(904		)		693				(405		)
Other assets	117				(3		)		16
Other liabilities	(90		)		51				26
Net cash provided by (used in) continuing operating activities	(156		)		1,456				17
Net cash provided by (used in) discontinued operating activities	(64		)		(660		)		1,295
Net cash provided by (used in) operating activities	(220		)		796				1,312
INVESTING ACTIVITIES:
Additions to property and equipment	(70		)		(272		)		(303		)
Payments for acquisitions, net of cash acquired, and purchases of intangibles	(6,736		)		(4		)		(39		)
Purchases of short-term investments	—				(378		)		(1,758		)
Proceeds from maturities and sales of short-term investments	31				1,355				1,024
Proceeds from divestiture, net of cash contributed and transaction costs	7				6,535				—
Other	2				—				—
Net cash provided by (used in) continuing investing activities	(6,766		)		7,236				(1,076		)
Net cash used in discontinued investing activities	—				(63		)		(78		)
Net cash provided by (used in) investing activities	(6,766		)		7,173				(1,154		)
FINANCING ACTIVITIES:
Repayments of debt and other obligations	(107		)		(368		)		(21		)
Proceeds from issuance of debt, net of issuance costs	6,069				500				—
Net proceeds from sales of common stock under employee stock plans	95				65				116
Tax payments related to restricted stock units	(65		)		(39		)		(36		)
Dividends and dividend equivalents paid	(222		)		(3,030		)		(413		)
Repurchases of common stock	(500		)		(1,868		)		(500		)
Other	21				6				54
Net cash provided by (used in) continuing financing activities	5,291				(4,734		)		(800		)
Net cash used in discontinued financing activities	—				(30		)		(11		)
Net cash provided by (used in) financing activities	5,291				(4,764		)		(811		)
Effect of exchange rate fluctuations on cash and cash equivalents	(41		)		(96		)		(180		)
Change in cash and cash equivalents	(1,736		)		3,109				(833		)
Beginning cash and cash equivalents	5,983				2,874				3,707
Ending cash and cash equivalents	$	4,247			$	5,983			$	2,874
Supplemental disclosures:
Equity investment in Veritas received as consideration	$	—			$	149			$	—
Income taxes paid, net of refunds	$	1,081			$	302			$	353
Interest expense paid	$	143			$	70			$	75
Additions to property and equipment in current liabilities	$	33			$	16			$	31

The accompanying Notes to the Consolidated Financial Statements are an integral part of these statements.

SYMANTEC CORPORATION

Notes to the Consolidated Financial Statements

BASIS OF PRESENTATION

Note 1. Summary of Significant Accounting Policies

Business

Symantec Corporation (“Symantec”, “we,” “us,” “our,” and “the Company” refer to Symantec Corporation and all of its subsidiaries) is a global leader in cybersecurity.

On August 1, 2016, we completed our acquisition of Blue Coat, Inc. (“Blue Coat”). Blue Coat’s results of operations have been included in our Consolidated Statements of Operations beginning August 1, 2016. On February 9, 2017, we completed our acquisition of LifeLock, Inc. (“LifeLock”). LifeLock’s results of operations have been included in our Consolidated Statements of Operations beginning February 9, 2017. See Note 6 for more information on the Blue Coat and LifeLock acquisitions.

On January 29, 2016, we completed the sale of Veritas. The results of Veritas are presented as discontinued operations in our Consolidated Statements of Operations and thus have been excluded from continuing operations and segment results for all reported periods. See Note 13 for more information on our discontinued operations.

Principles of consolidation

The accompanying consolidated financial statements of Symantec and our wholly-owned subsidiaries are prepared in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”). All significant intercompany accounts and transactions have been eliminated in consolidation.

Fiscal calendar

We have a 52/53-week fiscal year ending on the Friday closest to March 31. Our fiscal 2017 and 2016 were 52-week years ended March 31, 2017 and April 1, 2016, respectively, whereas our fiscal 2015 was a 53-week year ended April 3, 2015.

Use of estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Estimates are based upon historical factors, current circumstances and the experience and judgment of management. Management evaluates its assumptions and estimates on an ongoing basis and may engage outside subject matter experts to assist in its valuations. Actual results could differ from those estimates. Significant items subject to such estimates and assumptions include those related to the allocation of revenue recognized and deferred amounts, valuation of business combinations including acquired intangible assets and goodwill, loss contingencies, and the recognition and measurement of current and deferred income taxes including the measurement of uncertain tax positions.

Foreign currency translation

Assets and liabilities denominated in foreign currencies are translated using the exchange rate on the balance sheet dates. Revenues and expenses are translated using monthly average exchange rates prevailing during the year. The translation adjustments resulting from this process are included as a component of accumulated other comprehensive income.

Revenue recognition

General

We recognize revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is probable. Revenue is recognized net of allowances for returns, discounts, distributor incentives and end-user rebates, and any taxes collected from customers and subsequently remitted to governmental authorities.

For arrangements that include both software and non-software elements, we allocate revenue to the software deliverables as a group and non-software deliverables based on their relative selling prices. In such circumstances, we use a hierarchy to determine the fair value to be used for the relative selling price allocation: (i) vendor-specific objective evidence of fair value (“VSOE”), (ii) third-party evidence (“TPE”), and (iii) best estimate of selling price (“BESP”). VSOE is based on historical stand-alone sales or the stated renewal rate for maintenance in certain license arrangements. When we are unable to establish a selling price using VSOE or TPE, we use BESP in the allocation of arrangement consideration. The objective of BESP is to determine the price at which we would transact a sale if the product or service were sold on a stand-alone basis. The determination of BESP is made through consultation with and formal approval by our management, taking into consideration the go-to-market strategy, pricing factors, and historical transactions.

For software arrangements that include multiple elements, including perpetual software licenses, maintenance, services, and packaged products with content updates and subscriptions, we allocate and defer revenue for the undelivered items based on VSOE of the fair value of the undelivered elements, and recognize the difference between the total arrangement fee and the amount deferred for the undelivered items as license revenue. When VSOE does not exist for undelivered items, the entire arrangement fee is recognized ratably over the performance period.

For non-software arrangements that include multiple elements, we allocate revenue to each element based upon the relative selling price of each element. We use a hierarchy to determine the fair value to be used for the relative selling price allocation: (i)

VSOE, (ii) TPE, and (iii) BESP. The revenue allocated to each element is recognized when all revenue recognition criteria are met for that element.

Consumer Digital Safety

We sell consumer products directly to end-users and consumer packaged software products through a multi-tiered distribution channel. For consumer products that include content updates, we recognize revenue ratably over the term of the subscription upon sell-through to end-users, as the subscription period commences on the date of sale to the end-user. We offer the right of return of our products under various policies and programs with our distributors, resellers, and end-user customers. We estimate and record reserves for product returns as an offset to revenue or deferred revenue.

We offer channel and end-user rebates for our consumer digital safety products. Our estimated reserves for channel volume incentive rebates are based on distributors’ and resellers’ actual performance against the terms and conditions of volume incentive rebate programs, which are typically entered into quarterly. Our reserves for end-user rebates are estimated based on the terms and conditions of the promotional program, actual sales during the promotion, the amount of actual redemptions received, historical redemption trends by product and by type of promotional program, and the value of the rebate. We estimate and record reserves for channel and end-user rebates as an offset to revenue or deferred revenue. As of March 31, 2017 and April 1, 2016, we had reserves for consumer digital safety rebates of $18 million and $20 million, respectively. For consumer products that include content updates, rebates are recorded as a ratable offset to revenue or deferred revenue over the term of the subscription.

Enterprise Security

Revenue for our enterprise security products is earned from arrangements that can include various combinations of software, hardware, and services, and sold directly to end-users or through a multi-tiered distribution channel. We generally do not offer rights of return for enterprise security products and the distribution channel does not hold inventory. As a result, historical returns and related reserves are insignificant.

We offer channel rebates and marketing programs for our enterprise security products. Our estimated reserves for channel volume incentive rebates are based on distributors’ and resellers’ actual performance against the terms and conditions of volume incentive rebate programs, which are typically entered into quarterly. We also consider current market conditions and economic trends when estimating our reserves for rebates. If actual redemptions differ from our estimates, differences may result in the amount and timing of our net revenues for any period presented. As of March 31, 2017 and April 1, 2016, we had reserves for enterprise security rebates and marketing programs of $11 million and $12 million, respectively.

Fair value measurements

For assets and liabilities measured at fair value, 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 we consider assumptions that market participants would use when pricing the asset or liability.

The three levels of inputs that may be used to measure fair value are:

•	Level 1: Quoted prices in active markets for identical assets or liabilities.

•

Level 2: Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in less active markets or model-derived valuations. All significant inputs used in our valuations, such as discounted cash flows, are observable or can be derived principally from or corroborated with observable market data for substantially the full term of the assets or liabilities.

•	Level 3: Unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of assets or liabilities. We monitor and review the inputs and results of these valuation models to help ensure the fair value measurements are reasonable and consistent with market experience in similar asset classes.

Assets measured and recorded at fair value

Cash equivalents. We consider all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents. Cash equivalents are carried at amounts that approximate fair value due to the short period of time to maturity.

Short-term investments. Short-term investments consist of investment and marketable equity securities that are classified as available-for-sale and recognized at fair value using Level 1 and Level 2 inputs, which are quoted using market prices, independent pricing vendors, or other sources, to determine the fair value. Unrealized gains and losses, net of tax, are included in accumulated other comprehensive income. We regularly review our investment portfolio to identify and evaluate investments that have indications of impairment. Factors considered in determining whether a loss is other-than-temporary include: the length of time and extent to which the fair value has been lower than the cost basis, the financial condition and near-term prospects of the investee, credit quality, likelihood of recovery, and our ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in market value.

Non-marketable equity investments

We make equity investments in privately-held companies, which includes the B common shares we received as a portion of the net consideration in the sale of Veritas Technology LLC. These investments are accounted for under the cost method of

accounting. We assess the recoverability of these investments by reviewing various indicators of impairment. If indicators are present, a fair value measurement is made by performing a discounted cash flow analysis of the investment. If a decline in value is determined to be other-than-temporary, impairment is recognized and included in other income, net.

Accounts receivable

Accounts receivable are recorded at the invoiced amount and are not interest bearing. We maintain an allowance for doubtful accounts to reserve for potentially uncollectible receivables. We review our accounts receivables by aging category to identify specific customers with known disputes or collectability issues. In addition, we maintain an allowance for all other receivables not included in the specific reserve by applying specific percentages of projected uncollectible receivables to the various aging categories. In determining these percentages, we use judgment based on our historical collection experience and current economic trends. We also offset deferred revenue against accounts receivable when channel inventories are in excess of specified levels and for transactions where collection of a receivable is not considered probable.

As of March 31, 2017 and April 1, 2016, our allowance for doubtful accounts was $8 million and $16 million, respectively.

Property and equipment

Property, equipment, and leasehold improvements are stated at cost, net of accumulated depreciation. We capitalize costs incurred during the application development stage related to the development of internal use software and enterprise cloud computing services. We expense costs incurred related to the planning and post-implementation phases of development as incurred. Depreciation is provided on a straight-line basis over the estimated useful lives. Estimated useful lives for financial reporting purposes are as follows: buildings, 20 to 30 years; building improvements, 7 to 20 years; leasehold improvements, the lesser of the life of the improvement or the initial lease term; computer hardware and software, and office furniture and equipment, 3 to 5 years.

The following table summarizes property and equipment, net of accumulated depreciation by categories for the periods presented:

(In millions)	March 31, 2017				April 1, 2016
Land	$	73			$	73
Computer hardware and software	1,100				987
Office furniture and equipment	99				92
Buildings	425				426
Leasehold improvements	336				310
Construction in progress	22				74
Gross property and equipment	2,055				1,962
Accumulated depreciation	(1,118		)		(1,005		)
Property and equipment, net	$	937			$	957

Depreciation expense was $199 million, $213 million, and $229 million in fiscal 2017, 2016, and 2015, respectively.

Business combinations

We use the acquisition method of accounting under the authoritative guidance on business combinations. Each acquired company’s operating results are included in our Consolidated Financial Statements starting on the date of acquisition. The purchase price is equivalent to the fair value of consideration transferred. Tangible and identifiable intangible assets acquired and liabilities assumed as of the date of acquisition are recorded at their estimated fair values at acquisition date. Goodwill is recognized for the excess of purchase price over the net fair value of assets acquired and liabilities assumed.

The allocation of purchase price requires management to make significant estimates and assumptions in determining the fair values of the assets acquired and liabilities assumed especially with respect to intangible assets. Critical estimates in valuing intangible assets include, but are not limited to, future cash flows from customer relationships, developed technology, trade names and acquired patents; and discount rates. Management estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable. Unanticipated events and circumstances may occur which may affect the accuracy or validity of such assumptions, estimates or actual results.

Goodwill

Application of the goodwill impairment test requires us to make certain estimates and judgments, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of fair value for each reporting unit. We perform an impairment assessment of goodwill at the reporting unit level at least annually on the first day of the fourth quarter of each fiscal year, or more frequently if events or changes in circumstances indicate that the asset may be impaired. To determine a reporting unit’s fair value, we generally use the income approach which is based on the estimated discounted future cash flows of that unit. The estimation of future cash flows requires us to make projections of future revenues and expenses of each reporting unit and establish a weighted-average cost of capital to discount these cash flows. Changes in these key assumptions and estimates or other assumptions used in this process could materially affect our impairment analysis in a given year.

The accounting guidance gives us the option to perform a qualitative assessment to determine whether further impairment testing is necessary. The qualitative assessment considers events and circumstances that might indicate that a reporting unit’s fair value is less than its carrying amount. These include macro-economic conditions, such as deterioration in the entity’s operating environment or industry or market considerations; entity-specific events such as increasing costs, declining financial performance, or loss of key personnel; or other events such as the sale of a reporting unit or a sustained decrease in the company’s stock price. If it is determined, as a result of the qualitative assessment, that it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount, a quantitative test is performed.

For the fiscal year ended March 31, 2017, based on our qualitative assessment, we concluded that it is more likely than not that the fair values are more than their carrying values. Accordingly, there was no indication of impairment, and further quantitative testing was not required.

Long-lived assets

In connection with our acquisitions, we generally recognize assets for customer relationships, developed technology, finite-lived trade names, patents, and indefinite-lived trade names. Finite-lived intangible assets are carried at cost less accumulated amortization. Such amortization is provided on a straight-line basis over the estimated useful lives of the respective assets, generally from 1 to 11 years. Amortization for developed technology is recognized in cost of revenue. Amortization for customer relationships and certain trade names is recognized in operating expenses. Indefinite-lived intangible assets are not subject to amortization but instead tested for impairment annually or more frequently if events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

Long-lived assets, including intangible assets and property and equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or group of assets may not be recoverable. The evaluation is performed at the lowest level of identifiable cash flows independent of other assets. An impairment loss would be recognized when estimated undiscounted future cash flows generated from the assets are less than their carrying amount. Measurement of an impairment loss would be based on the excess of the carrying amount of the asset group over its fair value. Our estimates of future cash flows require significant judgment based on historical and anticipated future operating results and are subject to many factors which are subject to variability and change.

Debt

Our debt includes senior unsecured notes, senior term loans, convertible senior notes, and a senior unsecured revolving credit facility (“revolving credit facility”). Our senior unsecured notes are recorded at par value at issuance less a discount representing the amount by which the face value exceeds the fair value at the date of issuance and an amount which represents issuance costs. Our senior term loans are recorded at par value less debt issuance costs which are recorded as a reduction in the carrying value of the debt. Our convertible senior notes are recorded at par value less the fair value of the equity component of the notes, at their issuance date, determined using level 2 inputs and less any issuance costs. The discount and issuance costs associated with the various notes are amortized using the effective interest rate method over the term of the debt as a non-cash charge to interest expense. Borrowings under our revolving credit facility, if any, are recognized at cost plus accrued interest based upon stated interest rates. Debt maturities are classified as current liabilities on our Consolidated Balance Sheet if we are contractually obligated to repay them in the next twelve months or, prior to the balance sheet date, we have the authorization and intent to repay them prior to their contractual maturities and within the next twelve months.

Restructuring

Restructuring actions generally include significant actions involving employee-related severance charges and contract termination costs. Employee-related severance charges are largely based upon substantive severance plans, while some charges result from mandated requirements in certain foreign jurisdictions. These charges are reflected in the period when both the actions are probable and the amounts are estimable. Contract termination costs for leased facilities primarily reflect costs that will continue to be incurred under the contract for its remaining term without economic benefit to the Company. These charges are reflected in the period when the facility ceases to be used.

Income taxes

We compute the provision for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating losses and tax credit carryforwards in each jurisdiction in which we operate. We measure deferred tax assets and liabilities using the currently enacted tax rates that apply to taxable income in effect for the years in which those tax assets are expected to be realized or settled. We record a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

We are subject to tax in multiple U.S. and foreign tax jurisdictions. We are required to estimate the current tax exposure as well as assess the temporary differences between the accounting and tax treatment of assets and liabilities, including items such as accruals and allowances not currently deductible for tax purposes. We apply judgment in the recognition and measurement of current and deferred income taxes which includes the following critical accounting estimates. We assess the likelihood that we will be able to recover our deferred tax assets. If recovery is not likely, we must increase our provision for taxes by recording a valuation allowance against the deferred tax assets that we estimate will not ultimately be recoverable. We believe that we will ultimately recover the deferred tax assets recorded on our Consolidated Balance Sheets.

We use a two-step process to recognize liabilities for uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be

sustained on audit, including resolution of related appeals or litigation processes, if any. If we determine that the tax position will more likely than not be sustained on audit, the second step requires us to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as this requires us to determine the probability of various outcomes. We re-evaluate these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit, and new audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision in the period.

Our effective tax rate includes the impact of certain undistributed foreign earnings for which no U.S. taxes have been provided because such earnings are planned to be indefinitely reinvested outside the U.S. While we do not anticipate changing our intention regarding indefinitely reinvested earnings outside the U.S., material changes in our estimates of such earnings or tax legislation that limits or restricts the amount of such earnings could materially impact our income tax provision and effective tax rate. If certain foreign earnings previously treated as indefinitely reinvested outside the U.S. are repatriated, the related U.S. tax liability may be reduced by any foreign income taxes paid on these earnings.

Loss contingencies

We are subject to contingencies that expose us to losses, including various legal and regulatory proceedings, asserted and potential claims, liabilities related to repair or replacement of parts in connection with product defects, as well as product warranties and potential asset impairments that arise in the ordinary course of business. An estimated loss from such contingencies is recognized as a charge to income if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Judgment is required in both the determination of probability and the determination as to whether a loss is reasonably estimable as a critical accounting estimate. We review the status of each significant matter quarterly and we may revise our estimates.

Stock-based compensation

Stock-based compensation expense is measured at the grant date based on the fair value of the award. We recognize stock-based compensation cost over the award’s requisite service period on a straight-line basis. No compensation cost is ultimately recognized for forfeited awards in which employees do not render the requisite service. We estimate forfeitures based on historical experience.

The fair value of each restricted stock unit (“RSU”) and performance-based restricted stock unit (“PRU”) that does not contain a market condition is equal to the market value of our common stock on the date of grant. The fair value of each PRU that contains a market condition is estimated using the Monte Carlo simulation option pricing model. The fair values of RSUs and PRUs are not discounted by the dividend yield because our RSUs and PRUs are entitled to dividend equivalents to be paid in the form of cash upon vesting for each share of the underlying unit. As of March 31, 2017 and April 1, 2016, our total accrued dividend-equivalents rights (“DERs”) were $45 million and $75 million, respectively, which are included in other current liabilities and other long-term obligations on our Consolidated Balance Sheets.

We used the Black-Scholes model to determine the fair value of unvested stock options assumed in the Blue Coat and LifeLock acquisitions. The determination of the fair value of options using an option pricing model is affected by our stock price as well as assumptions regarding a number of complex and subjective variables. Because the options assumed in the Blue Coat and LifeLock acquisitions were all at- or in-the-money and Blue Coat and LifeLock lack sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term, we estimated the expected life of assumed options using the “simplified method”. For vested options, this represents the midpoint between the valuation date and the contractual term. For unvested options, this represents the midpoint between the average vesting time and full contractual term. Expected volatility is based on the average of historical volatility over the most recent period commensurate with the expected life of the option and the implied volatility of traded options. The risk-free interest rate is equal to the U.S. Treasury rates for the period equal to the expected life. The options assumed are without DERs and their fair values are discounted by our dividend yield.

Concentrations of credit risk

A significant portion of our revenue is derived from international sales and independent agents and distributors. Fluctuations of the U.S. dollar against foreign currencies, changes in local regulatory or economic conditions, piracy, or nonperformance by independent agents or distributors could adversely affect our operating results.

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents, short-term investments, and trade accounts receivable. Our investment policy limits the amount of credit risk exposure to any one issuer and to any one country. We are exposed to credit risks in the event of default by the issuers to the extent of the amount recorded on our Consolidated Balance Sheets. The credit risk in our trade accounts receivable is substantially mitigated by our credit evaluation process, reasonably short collection terms, and the geographical dispersion of sales transactions. As of March 31, 2017 and April 1, 2016, we had two distributors and one distributor, respectively, that accounted for over 10% of our total accounts receivable. We maintain reserves for potential credit losses and such losses have been within management’s expectations.

Advertising and other promotional costs

Advertising and other promotional costs are charged to operations as incurred and included in sales and marketing expenses. These costs totaled $212 million, $211 million, and $326 million for fiscal 2017, 2016, and 2015, respectively.

Sales commissions

Sales commissions that are incremental and directly related to customer sales contracts in which revenue is deferred are accrued and capitalized upon execution of a non-cancelable customer contract, and subsequently expensed over the term of such contract in proportion to the related future revenue streams. For commission costs where revenue is recognized, the related commission costs are recorded in the period of revenue recognition. As of March 31, 2017 and April 1, 2016, we had total deferred commissions of $77 million and $74 million, respectively, which are included in other current assets and other long-term assets on our Consolidated Balance Sheets.

PERFORMANCE & OPERATIONS

Note 2. Segment and Geographic Information

We operate in the following two operating segments, which are the same as our reportable segments:

•

Consumer Digital Safety. Our Consumer Digital Safety segment focuses on providing a Digital Safety solution to protect information, devices, networks, and the identity of consumers. This platform includes our Norton-branded services, which provide multi-layer security and identity protection on major desktop and mobile operating systems, to defend against increasingly complex online threats to individuals, families and small businesses. With the acquisition of LifeLock, a leader in identity protection services, we are accelerating our leadership in Consumer Digital Safety to protect all aspects of the consumer’s digital life.

•

Enterprise Security. Our Enterprise Security segment protects organizations so they can securely conduct business while leveraging new platforms and data. Our Enterprise Security segment includes our threat protection products, information protection products, cyber security services, website security, and advanced web and cloud security offerings. Our enterprise endpoint and network security and management offerings support evolving endpoints and networks, providing advanced threat protection while helping reduce cost and complexity. These solutions are delivered through various methods, such as software, appliance, SaaS and managed services.

Our operating segments are based upon the nature of our business and how our business is managed. Our Chief Operating Decision Makers (“CODMs”), comprised of our Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), use operating segment financial information to evaluate segment performance and to allocate resources. Our CODMs do not evaluate operating segments using discrete asset information, and our assets are not discretely identified by segment except for goodwill, as disclosed in Note 7. During the year, our Board appointed Gregory S. Clark, former Blue Coat CEO as our new CEO and Nicholas R. Noviello, former Blue Coat CFO as our new CFO. Despite the CODM changes during fiscal 2017, we did not change the way we report and evaluate segments.

There were no inter-segment sales for the periods presented. The following table summarizes the operating results of our reportable segments:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
Total Segments:
Net revenues	$	4,019			$	3,600			$	3,956
Operating income	$	1,026			$	1,026			$	1,275
Consumer Digital Safety:
Net revenues	$	1,664			$	1,670			$	1,887
Operating income	$	839			$	924			$	982
Enterprise Security:
Net revenues	$	2,355			$	1,930			$	2,069
Operating income	$	187			$	102			$	293

We do not allocate to our operating segments certain operating expenses that we manage separately at the corporate level and are not used in evaluating the results of, or in allocating resources to, our segments. These unallocated expenses consist of stock-based compensation expense, amortization of intangible assets, restructuring, separation, transition, and other charges, and acquisition and integration costs. In addition, corporate charges previously allocated to Veritas prior to its operational separation in the third quarter of fiscal 2016, but not reclassified within discontinued operations, were not reallocated to our segments. See Note 13 for more information on our discontinued operations.

The following table provides a reconciliation of our total reportable segments’ operating income to our total operating income (loss):

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
Total segment operating income	$	1,026			$	1,026			$	1,275
Less reconciling items:
Unallocated corporate charges related to Veritas	—				186				704
Stock-based compensation	440				161				131
Amortization of intangibles	293				86				122
Restructuring, separation, transition, and other	273				136				164
Acquisition and integration costs	120				—				—
Total consolidated operating income (loss) from continuing operations	$	(100	)		$	457			$	154

Product revenue information

The following table summarizes net revenues by significant product categories:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
Norton	$	1,597			$	1,670			$	1,887
Threat protection	804				807				882
Blue Coat security	427				—				—
Others (1)	1,191				1,123				1,187
Total net revenues	$	4,019			$	3,600			$	3,956

(1)	No other product category represented more than 10% of the respective totals.

Geographical information

Net revenues by geography are based on the billing addresses of our customers. The following table represents net revenues by geographic area for the periods presented:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
U.S.	$	2,105			$	1,897			$	1,960
International (1)	1,914				1,703				1,996
Total net revenues	$	4,019			$	3,600			$	3,956

(1)	No individual country represented more than 10% of the respective totals.

The table below represents our property and equipment, net of accumulated depreciation, by geographic area at the end of each period presented. We do not identify or allocate our other assets by geographic area.

(In millions)	March 31, 2017				April 1, 2016
U.S.	$	822			$	809
International (1)	115				148
Total property and equipment, net	$	937			$	957

(1)	No individual country represented more than 10% of the respective totals.

Significant customers

In fiscal 2017, 2016 and 2015, no customer accounted for more than 10% of our total net revenues.

Note 3. Net Income Per Share

Basic and diluted net income per share are computed on the basis of the weighted-average number of shares of common stock outstanding during the period. Diluted net income per share also include the incremental effect of dilutive potential common shares outstanding during the period using the treasury stock method. Dilutive potential common shares include the dilutive effect of shares underlying outstanding stock options, RSUs, PRUs, Employee Stock Purchase Plan (“ESPP”) and convertible notes. See Note 11 for more information on our stock-based compensation.

The components of net income per share are as follows:

	Year Ended
(In millions, except per share data)	March 31, 2017				April 1, 2016				April 3, 2015
Income (loss) from continuing operations	$	(236	)		$	(821	)		$	109
Income from discontinued operations, net of tax	130				3,309				769
Net income (loss)	$	(106	)		$	2,488			$	878
Income (loss) per share - basic:
Continuing operations	$	(0.38	)		$	(1.23	)		$	0.16
Discontinued operations	$	0.21			$	4.94			$	1.12
Net income (loss) per share	$	(0.17	)		$	3.71			$	1.27
Income (loss) per share - diluted:
Continuing operations	$	(0.38	)		$	(1.23	)		$	0.16
Discontinued operations	$	0.21			$	4.94			$	1.10
Net income (loss) per share	$	(0.17	)		$	3.71			$	1.26
Weighted-average outstanding shares - basic	618				670				689
Dilutive potential shares from stock-based compensation	—				—				7
Weighted-average shares outstanding - diluted	618				670				696

Note: Net income per share amounts may not add due to rounding.

The following have been excluded from the computation of diluted net income per share because their effect would have been anti-dilutive:

	Year Ended
(In millions)	March 31, 2017			April 1, 2016			April 3, 2015
Convertible shares	91			30			—
Restricted and performance-based restricted stock units	29			19			—
Stock options and ESPP	21			—			1
Total	141			49			1

Under the treasury stock method, the Convertible Senior Notes will generally have a dilutive impact on earnings when our average stock price for the period exceeds approximately $16.77 per share for the 2.5% Convertible Senior Notes and $20.41 per share for the 2.0% Convertible Senior Notes. The conversion feature of both notes was anti-dilutive during fiscal 2017 due to a loss from continuing operations. The conversion feature of our 2.5% Convertible Senior Notes was also anti-dilutive during fiscal 2016 due to a loss from continuing operations. See Note 8 for more information on our debt.

Note 4. Restructuring, Separation, Transition, and Other Costs

Our restructuring, separation, transition, and other costs and liabilities consist primarily of severance, facilities, separation, transition, and other related costs. Severance costs generally include severance payments, outplacement services, health insurance coverage, and legal costs. Facilities costs generally include rent expense and lease termination costs, less estimated sublease income. Separation and related costs include advisory, consulting, and other costs incurred in connection with the separation of Veritas. Transition costs primarily consist of consulting charges associated with the implementation of new enterprise resource planning systems and costs to automate business processes. Other costs primarily consist of asset write-offs and advisory fees incurred in connection with restructuring events. Restructuring, separation, transition, and other costs are managed at the corporate level and are not allocated to our reportable segments. See Note 2 for information regarding the reconciliation of total segment operating income to total consolidated operating income (loss).

Fiscal 2017 Plan

We initiated a restructuring plan in the first quarter of fiscal 2017 to reduce complexity by means of long-term structural improvements (the “Fiscal 2017 Plan”). We expect to reduce headcount and close certain facilities in connection with the restructuring plan. We expect total costs incurred in connection with the Fiscal 2017 Plan to range between $415 million and $465 million, of which approximately $185 million to $195 million is expected to be for severance and termination benefits and $190 million to $215 million is expected to be for other exit and disposal costs primarily consisting of contract termination, relocation costs, and advisory fees. The remainder is expected to be in the form of asset write-offs. These actions are expected to be completed in fiscal 2018. Additionally, we expect continuing significant transition costs associated with the implementation of a new enterprise resource planning system and costs to automate business processes. As of March 31, 2017, liabilities for excess facility obligations at several U.S. and international locations are expected to be paid throughout the respective lease terms, the longest of which extends through fiscal 2022.

Restructuring, separation, transition, and other costs summary

We incurred $94 million in continuing operations transition expense during fiscal 2017. As of March 31, 2017 and April 1, 2016, restructuring and separation liabilities were included in accounts payable, other current liabilities and other long-term obligations in our Consolidated Balance Sheets. Additionally, $10 million of the following restructuring and separation costs is included in income from discontinued operations, net of income taxes.

(In millions)	Balance as of April 1, 2016				Costs, Net of Adjustments				Cash Payments				Non-Cash Charges				Balance as of March 31, 2017				Fiscal 2017 Plan Cumulative Incurred to Date
Fiscal 2017 Plan:
Severance and termination costs	$	—			$	76			$	(56	)		$	—			$	20			$	76
Other exit and disposal costs	4				75				(50		)		(7		)		22				79
Asset write-offs	—				23				—				(23		)		—				23
Fiscal 2017 Plan total	4				174				(106		)		(30		)		42				$	178
Prior year plans	$	29			$	15			$	(35	)		$	(5	)		$	4
Restructuring and separation plans total	$	33			$	189			$	(141	)		$	(35	)		$	46

Note 5. Income Taxes

The components of income tax expense (benefit) recorded in continuing operations are as follows:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
Current:
Federal	$	108			$	69			$	4
State	6				13				(18		)
International	68				46				40
Total	182				128				26
Deferred:
Federal	(177		)		1,060				(38		)
State	(17		)		15				(4		)
International	(14		)		10				8
Total	(208		)		1,085				(34		)
Income tax expense (benefit)	$	(26	)		$	1,213			$	(8	)

Pre-tax income from international operations was $353 million, $125 million, and $41 million for fiscal 2017, 2016, and 2015, respectively.

The difference between our effective income tax and the federal statutory income tax is as follows:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
Federal statutory tax expense (benefit)	$	(92	)		$	138			$	35
Foreign earnings not considered indefinitely reinvested, net	12				1,065				(8		)
State taxes, net of federal benefit	(11		)		9				(13		)
Foreign earnings taxed at less than the federal rate	34				12				34
Domestic production activities deduction	—				(5		)		(1		)
Federal research and development credit	(9		)		(9		)		(8		)
Valuation allowance (decrease) increase	(1		)		10				1
Nondeductible separation costs	—				1				2
Change in uncertain tax positions	(24		)		(4		)		(57		)
Nondeductible transaction costs	11				—				—
Write-off of tax attributes due to restructuring	52				—				—
Nondeductible officer compensation	7				—				—
Other, net	(5		)		(4		)		7
Income tax expense (benefit)	$	(26	)		$	1,213			$	(8	)

The principal components of deferred tax assets and liabilities are as follows:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016
Deferred tax assets:
Tax credit carryforwards	$	42			$	53
Net operating loss carryforwards of acquired companies	82				34
Other accruals and reserves not currently tax deductible	127				112
Deferred revenue	137				89
Loss on investments not currently tax deductible	9				14
State income taxes	2				8
Stock-based compensation	122				39
Other	14				9
Gross deferred tax assets	535				358
Valuation allowance	(38		)		(50		)
Deferred tax assets, net of valuation allowance	$	497			$	308
Deferred tax liabilities:
Property and equipment	$	(34	)		$	(106	)
Goodwill	(54		)		(50		)
Intangible assets	(783		)		(11		)
Unremitted earnings of foreign subsidiaries	(1,939		)		(1,327		)
Prepaids and deferred expenses	(24		)		(17		)
Convertible debt	(21		)		—
Deferred tax liabilities	(2,855		)		(1,511		)
Net deferred tax liabilities	$	(2,358	)		$	(1,203	)

The valuation allowance provided against our deferred tax assets as of March 31, 2017, is mainly attributable to capital losses, state tax credits, and net operating losses in foreign jurisdictions. The valuation allowance decreased by a net of $12 million in fiscal 2017, due to changes in corresponding deferred tax assets primarily related to capital losses and state tax credits.

As of March 31, 2017, we have U.S. federal net operating losses attributable to various acquired companies of approximately $186 million, which, if not used, will expire between fiscal 2018 and 2036. We have U.S. federal research and development credits and alternative minimum tax credits of approximately $4 million and $5 million, respectively. The research and development credits, if not used, will expire between fiscal 2019 and 2036 and the alternative minimum tax credit carryforwards can be carried forward indefinitely. The net operating loss carryforwards, U.S. federal research and development tax credits, and

alternative minimum tax credits are subject to an annual limitation under Internal Revenue Code §382, but are expected to be fully realized. We have $14 million of foreign tax credits which, if not used, will expire beginning in fiscal 2027. Furthermore, we have U.S. state net operating loss and credit carryforwards attributable to various acquired companies of approximately $185 million and $28 million, respectively. If not used, our U.S. state net operating losses will expire between fiscal 2018 and 2037 and the majority of our U.S. state credit carryforwards can be carried forward indefinitely. In addition, we have foreign net operating loss carryforwards attributable to various acquired foreign companies of approximately $40 million, the majority of which, under current applicable foreign tax law, can be carried forward indefinitely.

In assessing the ability to realize our deferred tax assets, we considered whether it is more likely than not that some portion or all the deferred tax assets will not be realized. We considered the following: we have historical cumulative book income, as measured by the current and prior two years; we have strong, consistent taxpaying history; we have substantial U.S. federal income tax carryback potential; and we have substantial amounts of scheduled future reversals of taxable temporary differences from our deferred tax liabilities. We have concluded that this positive evidence outweighs the negative evidence and, thus, that the deferred tax assets as of March 31, 2017 are realizable on a “more likely than not” basis.

As of March 31, 2017, no provision has been made for federal or state income taxes on $3.9 billion of cumulative unremitted earnings of certain of our foreign subsidiaries since we plan to indefinitely reinvest these earnings. As of March 31, 2017, the unrecognized deferred tax liability for these earnings was approximately $1.1 billion.

The increase in our effective tax rate in fiscal 2016 compared to fiscal 2015 was primarily driven by $1.1 billion of tax expense for providing U.S. taxes on certain undistributed foreign earnings, primarily those attributable to the sale of Veritas. These undistributed foreign earnings have been excluded from the $3.9 billion noted above of cumulative unremitted earnings of certain of our foreign subsidiaries that we plan to reinvest indefinitely as of March 31, 2017.

The aggregate changes in the balance of gross unrecognized tax benefits were as follows:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
Balance at beginning of year	$	197			$	193			$	282
Settlements with tax authorities	(23		)		(25		)		(150		)
Lapse of statute of limitations	(9		)		(15		)		(13		)
Decrease due to divestiture	—				(7		)		—
Increase related to prior period tax positions	21				4				147
Decrease related to prior period tax positions	(9		)		(7		)		(96		)
Increase related to current year tax positions	38				54				23
Increase due to acquisition	33				—				—
Net increase (decrease)	51				4				(89		)
Balance at end of year	$	248			$	197			$	193

There was a change of $51 million in gross unrecognized tax benefits during the 2017 fiscal year. This gross liability does not include offsetting tax benefits associated with the correlative effects of potential transfer pricing adjustments, interest deductions, and state income taxes.

Of the total unrecognized tax benefits at March 31, 2017, $176 million, if recognized, would favorably affect the Company’s effective tax rate.

We recognize interest and/or penalties related to uncertain tax positions in income tax expense. At March 31, 2017, before any tax benefits, we had $22 million of accrued interest and penalties on unrecognized tax benefits. Interest included in our provision for income taxes was an expense of $5 million for the year ended March 31, 2017. If the accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced in the period that such determination is made, and reflected as a reduction of the overall income tax provision.

We file income tax returns in the U.S. on a federal basis and in many U.S. state and foreign jurisdictions. Our most significant tax jurisdictions are the U.S., Ireland, and Singapore. Our tax filings remain subject to examination by applicable tax authorities for a certain length of time following the tax year to which those filings relate. Our fiscal years 2014 through 2017 remain subject to examination by the Internal Revenue Service (“IRS”) for U.S. federal tax purposes. Our fiscal years prior to 2014 have been settled and closed with the IRS. Our 2013 through 2017 fiscal years remain subject to examination by the appropriate governmental agencies for Irish tax purposes, and our 2012 through 2017 fiscal years remain subject to examination by the appropriate governmental agencies for Singapore tax purposes.

On March 18, 2015, we settled and effectively settled matters with the IRS for the Symantec 2009 through 2013 fiscal years. The settlement and effective settlement resulted in a benefit to tax expense in fiscal year 2015 of $59 million. Additionally, the Company settled transfer price related matters of $158 million, a portion of which was accounted for against deferred tax liabilities on unremitted foreign earnings. The Company has paid in $155 million to cover the final tax and interest liability on the settlement.

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 the gross unrecognized tax benefits related to these audits could decrease (whether by payment, release, or a combination of both) in the next 12 months by $4 million. Depending on the nature of the settlement or expiration of statutes of limitations, we estimate $3 million could affect our income tax provision and therefore benefit the resulting effective tax rate.

We continue to monitor the progress of ongoing income tax controversies and the impact, if any, of the expected tolling of the statute of limitations in various taxing jurisdictions.

NON-CURRENT ASSETS & DEBT

Note 6. Acquisitions

Blue Coat acquisition

On August 1, 2016, we acquired all of the outstanding common stock of Blue Coat, a provider of advanced web security solutions for global enterprises and governments. The addition of Blue Coat’s suite of network and cloud security products to our innovative Enterprise Security product portfolio has enhanced our threat protection and information protection products while providing us with complementary products, such as advanced web and cloud security solutions, that address the network and cloud security needs of enterprises. This augmentation of our product portfolio, together with the integration of Blue Coat’s large threat database with our global civilian cyber intelligence threat network, allows us to provide an integrated cyber defense platform, addressing both endpoint and network security, and offer differentiated security solutions. It also positions us well to introduce new cybersecurity solutions that address the ever-evolving threat landscape, the changes introduced by the shift to mobile and cloud along with the adoption of Internet of Things (IoT) devices. Our enhanced portfolio also positions us well to address the challenges created by regulatory and privacy concerns.

The total consideration for the acquisition of Blue Coat was approximately $4.7 billion, net of cash acquired, and consisted of the following:

(In millions)	August 1, 2016
Cash and equity consideration for outstanding Blue Coat common shares and restricted stock awards	$	2,006
Cash consideration for outstanding Blue Coat debt	1,910
Issuance of Symantec 2.0% convertible debt to Bain Capital Funds (selling shareholder)	750
Fair value of vested assumed Blue Coat stock options	102
Cash consideration for acquiree acquisition-related expenses	51
Total consideration	4,819
Cash acquired	(146		)
Net consideration transferred	$	4,673

The cash consideration for the retirement of Blue Coat debt included the repayment of the associated principal, accrued interest, premiums, and other costs.

We funded a portion of the total purchase price through debt financing, including borrowings of an aggregate principal amount of $2.8 billion under an amended and restated credit facility and a new term loan facility. On August 1, 2016, we also issued 2.0% Convertible Senior Notes due 2021 for an aggregate principal amount of $1.25 billion, $750 million of which was to a selling shareholder. See Note 8 for more information on these debt instruments.

Our preliminary allocation of the purchase price, based on the estimated fair values of the assets acquired and liabilities assumed on the close date, were as follows:

(In millions)	August 1, 2016
Assets:
Accounts receivable	$	125
Other current assets	65
Property and equipment	54
Intangible assets	1,608
Goodwill	4,083
Other long-term assets	9
Total assets acquired	5,944
Liabilities:
Other current liabilities	111
Deferred revenue	220
Long-term deferred tax liabilities	921
Other long-term obligations	19
Total liabilities assumed	1,271
Total purchase price	$	4,673

The allocation of the purchase price was based upon a preliminary valuation, and our estimates and assumptions are subject to refinement within the measurement period (up to one year from the close date). Adjustments to the purchase price allocation may require adjustments to goodwill prospectively. The primary areas of the preliminary purchase price allocation that are not yet finalized are certain tax matters and identification of contingencies.

The preliminary goodwill of $4.1 billion arising from the acquisition is attributed to the expected synergies, including future cost efficiencies, and other benefits that are expected to be generated by combining Symantec and Blue Coat. Substantially all of the goodwill recognized is not expected to be deductible for tax purposes. See Note 7 for more information on goodwill.

Preliminary identified intangible assets and their respective useful lives, as of August 1, 2016, were as follows:

(In millions, except for useful lives)	Fair Value				Weighted-Average Estimated Useful Life
Customer relationships	$	844			7 years
Developed technology and patents	739				4.3 years
Finite-lived trade names	4				2 years
Product backlog	2				4 months
Total identified finite-lived intangible assets	1,589
In-process research and development	19				N/A
Total identified intangible assets	$	1,608

The fair value of in-process research and development was determined using the relief-from-royalty method. A key assumption of this method is a hypothetical technology licensing rate applied to forecasted revenue. The premise associated with this valuation method is that, in lieu of ownership of the asset, a market participant would be willing to pay a licensing fee for the use of that asset.

Impact on operating results

Our results of continuing operations for fiscal 2017 include $427 million of net revenues attributable to Blue Coat products beginning August 1, 2016. It is impracticable to determine the amounts of net income attributable to Blue Coat for fiscal 2017 as we have integrated Blue Coat with our ongoing operations. Net revenues and costs related to the Blue Coat products are included in our Enterprise Security segment results for fiscal 2017. Transaction costs of $48 million incurred by Symantec in connection with the Blue Coat acquisition are included in operating expenses in our Consolidated Statements of Operations for fiscal 2017. See Note 2 for more information on our segments.

LifeLock acquisition

On February 9, 2017, we completed the acquisition of LifeLock, a provider of proactive identity theft protection services for consumers and consumer risk management services for enterprises, for approximately $2.3 billion in total consideration. LifeLock’s services are provided on a monthly or annual subscription basis and primarily consist of identifying and notifying users of identity-related and other events and assisting users in remediating their impact. The addition of LifeLock’s identity and fraud

protection offerings to our leading Consumer Digital Safety product portfolio will allow us to provide a comprehensive digital safety solution designed to protect information across devices, customer identities and the connected home and family.

The total consideration for the acquisition of LifeLock was approximately $2.3 billion, net of cash acquired, and consisted of the following:

(In millions)	February 9, 2017
Cash for outstanding LifeLock common shares and vested equity awards	$	2,298
Fair value of vested assumed LifeLock equity awards	10
Liability assumed for dissenting shareholders	68
Liability assumed for lost shareholders	1
Total consideration	2,377
Cash acquired	(94		)
Net consideration transferred	$	2,283

We funded a portion of the total purchase price with the issuance of 5.0% Senior Notes due 2025 for an aggregate principal amount of $1.1 billion. See Note 8 for more information on these debt instruments.

Our preliminary allocation of the purchase price, based on the estimated fair values of the assets acquired and liabilities assumed on the close date, were as follows:

(In millions)	February 9, 2017
Assets:
Accounts receivable	$	20
Other current assets	110
Property and equipment	46
Intangible assets	1,247
Goodwill	1,401
Deferred tax assets	16
Other long-term assets	13
Total assets acquired	2,853
Liabilities:
Accounts payable	2
Deferred revenue	96
Income taxes payable	5
Other current liabilities	59
Long-term deferred tax liabilities	394
Other long-term obligations	14
Total liabilities assumed	570
Total purchase price	$	2,283

The allocation of the purchase price was based upon a preliminary valuation, and our estimates and assumptions are subject to refinement within the measurement period (up to one year from the close date). Adjustments to the purchase price allocation may require adjustments to goodwill prospectively. The primary areas of the preliminary purchase price allocation that are not yet finalized are certain tax matters, intangible assets, and identification of contingencies.

The preliminary goodwill of $1.4 billion arising from the acquisition is attributed to the expected synergies, including future cost efficiencies, and other benefits that are expected to be generated by combining Symantec and LifeLock. Substantially all of the goodwill recognized is not expected to be deductible for tax purposes. See Note 7 for more information on goodwill.

Preliminary identified intangible assets and their respective useful lives were as follows:

(In millions, except for useful lives)	Fair Value				Weighted-Average Estimated Useful Life
Customer relationships	$	532			7.0 years
Developed technology	126				5.0 years
Finite-lived trade names and other	6				5.9 years
Total identified finite-lived intangible assets	664
Indefinite-lived trade names	583				N/A
Total identified intangible assets	$	1,247

Impact on operating results

Our results of continuing operations for fiscal 2017 include $72 million and $98 million, respectively, of net revenues and a pre-tax loss attributable to LifeLock beginning February 9, 2017. LifeLock’s revenues of $67 million and $5 million are included in our Consumer Digital Safety and Enterprise Security segment results, respectively. Transaction costs of $21 million incurred by Symantec in connection with the LifeLock acquisition are included in operating expenses in our Consolidated Statements of Operations for fiscal 2017. See Note 2 for more information on our segments.

Unaudited combined pro forma information

The unaudited pro forma financial results combine the historical results of Symantec, Blue Coat and LifeLock for fiscal years 2017 and 2016. The results include the effects of pro forma adjustments as if Blue Coat and LifeLock were acquired at the beginning of our 2016 fiscal year. The pro forma results for fiscal years 2017 and 2016 include adjustments for amortization of acquired intangible assets, stock-based compensation, commissions, interest on debt used to finance the acquisition, and acquisition-related transaction costs, as well as for the income tax effect of these pro forma adjustments.

The unaudited pro forma financial results presented below do not include any anticipated synergies or other expected benefits of the acquisitions. These pro forma results are presented for informational purposes only and are not indicative of future operations or results that would have been achieved had the acquisition been completed as of the beginning of our 2016 fiscal year. The following table summarizes the pro forma financial information:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016
Net revenues	$	4,817			$	4,803
Net income (loss)	$	(174	)		$	1,791

Note 7. Goodwill and Intangible Assets

Goodwill

The changes in the carrying amount of goodwill by segment are as follows:

(In millions)	Consumer Digital Safety				Enterprise Security				Total
Balance as of April 3, 2015	$	1,230			$	1,916			$	3,146
Translation adjustments	1				1				2
Balance as of April 1, 2016	1,231				1,917				3,148
Acquisition of Blue Coat	—				4,083				4,083
Acquisition of LifeLock	1,318				83				1,401
Translation adjustments	—				(5		)		(5		)
Balance as of March 31, 2017	$	2,549			$	6,078			$	8,627

Intangible assets, net

	March 31, 2017												April 1, 2016
(In millions)	Gross Carrying Amount				Accumulated Amortization				Net Carrying Amount				Gross Carrying Amount				Accumulated Amortization				Net Carrying Amount
Customer relationships	$	1,646			$	(322	)		$	1,324			$	406			$	(320	)		$	86
Developed technology	1,006				(229		)		777				144				(84		)		60
Finite-lived trade names	23				(6		)		17				2				(2		)		—
Patents	21				(20		)		1				21				(18		)		3
Other	2				—				2				—				—				—
Total finite-lived intangible assets	2,698				(577		)		2,121				573				(424		)		149
Indefinite-lived trade names	864				—				864				294				—				294
In-process research and development	19				—				19				—				—				—
Total	$	3,581			$	(577	)		$	3,004			$	867			$	(424	)		$	443

As a result of our acquisitions of Blue Coat and LifeLock, we recorded $1.6 billion and $1.2 billion of acquired intangible assets, respectively, during fiscal 2017. See Note 6 for more information on the Blue Coat and LifeLock acquisitions. As of March 31, 2017, future amortization expense related to intangible assets that have finite lives is as follows by fiscal year:

(In millions)		March 31, 2017
2018		$	452
2019		426
2020		407
2021		295
2022		235
Thereafter		306
Total		$	2,121

Note 8. Debt

The following table summarizes components of our debt:

(In millions)	March 31, 2017				April 1, 2016				Effective Interest Rate
2.75% Senior Notes due June 15, 2017	$	600			$	600			2.79	%
Senior Term Loan A-1 due May 10, 2019	1,000				—				LIBOR plus (1)
Senior Term Loan A-2 due August 1, 2019	800				—				LIBOR plus (1)
Senior Term Loan A-3 due August 1, 2019	200				—				LIBOR plus (1)
4.2% Senior Notes due September 15, 2020	750				750				4.25	%
2.5% Convertible Senior Notes due April 1, 2021	500				500				3.76	%
Senior Term Loan A-5 due August 1, 2021	1,710				—				LIBOR plus (1)
2.0% Convertible Senior Notes due August 15, 2021	1,250				—				2.66	%
3.95% Senior Notes due June 15, 2022	400				400				4.05	%
5.0% Senior Notes due April 15, 2025	1,100				—				5.23	%
Total principal amount	8,310				2,250
Less: unamortized discount and issuance costs	(124		)		(43		)
Total debt	8,186				2,207
Less: current portion	(1,310		)		—
Total long-term portion	$	6,876			$	2,207

(1)	The senior term facilities bear interest at a rate equal to the London InterBank Offered Rate (“LIBOR”) plus a margin based on the debt rating of our non-credit-enhanced, senior unsecured long-term debt.

The future maturities of debt by fiscal year are as follows:

(In millions)		March 31, 2017
2018		$	1,310
2019		—
2020		2,000
2021		1,260
2022		2,240
Thereafter		1,500
Total future maturities of debt		$	8,310

2017 Activity

On February 9, 2017, we issued $1.1 billion aggregate principal amount of our 5.0% Senior Notes due April 15, 2025 (the “5.0% Senior Notes”). The 5.0% Senior Notes are governed by a basic and supplemental indenture. The 5.0% Senior Notes bear interest at a rate of 5.00% per year, payable semiannually in arrears on April 15 and October 15 of each year, beginning on October 15, 2017. The 5.0% Senior Notes will mature on April 15, 2025.

We may redeem some or all of the 5.0% Senior Notes at any time prior to April 15, 2020 at a price equal to 100% of the principal amount of the 5.0% Senior Notes redeemed, plus accrued and unpaid interest, if any, and a premium, as described in the supplemental indenture to the 5.0% Senior Notes. On or after April 15, 2020, we may redeem some or all of the 5.0% Senior Notes at the applicable redemption prices set forth in the Supplemental Indenture, plus accrued and unpaid interest. Debt issuance costs of the 5.0% Senior Notes have been recorded as a reduction of the carrying value of the 5.0% Senior Notes on our Consolidated Balance Sheet as of March 31, 2017, and are being amortized as interest expense over the term of the 5.0% Senior Notes. The indentures contain customary events of default. In the case of certain events of bankruptcy or insolvency, the principal amount of the 5.0% Senior Notes, and any unpaid interest accrued thereon, shall automatically become immediately due and payable. We used the proceeds from the 5.0% Senior Notes to finance a portion of the acquisition of LifeLock. LifeLock’s existing revolving credit facility was terminated in connection with the acquisition. See Note 6 for further discussion of the LifeLock acquisition.

On May 10, 2016, we entered into a senior unsecured credit facility, which provided for a $1.0 billion 5 years revolving credit facility (the “Revolving Facility”) and a 3 years term loan (the “Senior Term Loan A-1”) in an amount of $1.0 billion (of which up to $20 million may be in the form of short-term swingline loans), which mature on May 10, 2021 and 2019, respectively. On July 18, 2016, we amended and restated the Revolving Facility and Senior Term Loan A-1 Agreement to provide for, among other things, an additional $800 million 3 years term loan (the “Senior Term Loan A-2”) which matures on August 1, 2019. The amended and restated Revolving Facility and Senior Term Loan A-1/A-2 Agreement became effective on August 1, 2016, concurrently with the closing of the Blue Coat acquisition. The amended and restated Revolving Facility and Senior Term Loan A-1/A-2 Agreement provides that we have the right at any time, subject to customary conditions, and not more than once in any year, to request incremental revolving commitments of at least $100 million, and incremental loans of at least $100 million under the Senior Term Loan A-1, provided that the aggregate amount of all such incremental increases does not exceed $500 million.

On August 1, 2016, we entered into a Term Loan Agreement that provides for a 3 years term loan with a principal amount of $200 million (the “Senior Term Loan A-3”) and a 5 years term loan with a principal amount of $1.8 billion (the “Senior Term Loan A-5”). At the closing of the Blue Coat acquisition, we borrowed the full amounts available under the Senior Term Loan A-3 and the Senior Term Loan A-5 to, among other things, fund the cash consideration for the Blue Coat acquisition and pay transaction-related expenses. On October 3, 2016, we exercised our option to assign the loans under the Senior Term Loan A-3/A-5 Agreement to a foreign subsidiary in accordance with the Term Loan Agreement.

On June 12, 2016, we entered into an investment agreement relating to the issuance of $1.25 billion aggregate principal amount of 2.0% convertible unsecured notes. The notes were issued concurrent with the Blue Coat acquisition. See further description below.

Revolving Facility and Senior Term Loan A-1/A-2 Agreement

Borrowings under the Revolving Facility and Senior Term Loan A-1/A-2 Agreement bear interest at a floating rate of interest plus an applicable margin which is based on our senior unsecured credit agency rating, according to the terms of the agreement. We are obliged to pay commitment fees on the daily amount of the unused revolving commitment at a rate based on our debt ratings. Interest and commitment fees are payable in arrears quarterly. We may voluntarily repay all outstanding loans under the Revolving Facility and Senior Term Loan A-1/A-2 Agreement at any time without premium or penalty according to the terms of the agreement. The Senior Term Loan A-1, Senior Term Loan A-2 and Revolving Facility mature on May 10, 2019, August 1, 2019 and May 10, 2021, respectively.

The Revolving Facility and Term Loan A-1/A-2 Agreement contain a covenant that we maintain a ratio of consolidated funded debt to consolidated adjusted earnings before interest, taxes, depreciation, and amortization (“EBITDA”) of not more than 6.00 to 1.0 through December 31, 2018, then 5.25 to 1.0 thereafter, and restrictions on subsidiary indebtedness, liens, stock repurchases and dividends (with exceptions permitting our regular quarterly dividend). In addition, the Revolving Facility and

Senior Term Loan A-1/A-2 Agreement contain a covenant for customary events of default or a change of control, under which our payment obligations may be accelerated and the interest rate applicable to any borrowings will increase by 200 basis points.

Senior Term Loan A-3/A-5 Agreement

The loans under the Senior Term Loan A-3/A-5 Agreement bear interest at a floating rate of interest plus an applicable margin, which is based on our senior unsecured credit agency rating, according to the terms of the agreement. The Senior Term Loan A-3 will mature on August 1, 2019 and has no scheduled payments. The Senior Term Loan A-5 will mature on August 1, 2021. For the duration of the loan, quarterly payments are due on the Senior Term Loan A-5 in aggregate annual amounts equal to 10% of the original principal amount. In accordance with the terms of the Senior Term Loan A-3/A-5 Agreement, the Company may voluntarily repay outstanding principal balances under the Senior Term Loan A-3 and Senior Term Loan A-5 at any time without premium or penalty, and with regard to the Senior Term Loan A-5, prepayments must be applied to reduce the subsequent scheduled and outstanding required payments.

The Senior Term Loan A-3/A-5 Agreement contains customary representations and warranties, affirmative and negative covenants, including a covenant that the Company maintain a ratio of consolidated funded debt to consolidated EBITDA that is less than 6.00 to 1.0 until December 31, 2018, decreasing to 5.25:1.0 thereafter. In addition, the Senior Term Loan A-3/A-5 Agreement contains a covenant for customary events of default, including us experiencing a change of control described in the Revolving Facility and Term Loan A-1/A-2 Agreement, under which our payment obligations may be accelerated and the interest rate applicable to any borrowings under the Senior Term Loan A-3/A-5 Agreement will increase by 200 basis points.

Other Senior Notes

As of March 31, 2017, we had three series of senior notes issued and outstanding (“Other Senior Notes”) in addition to the 5.0% Senior Notes discussed above. The Other Senior Notes are senior unsecured obligations that rank equally in right of payment with all of our existing and future senior, unsecured, unsubordinated obligations. Each series of Other Senior Notes may be redeemed at any time, subject to the make-whole provisions contained in the applicable indenture relating to such series of Other Senior Notes.

Interest on each series of Other Senior Notes is payable semi-annually in arrears, and the 2.75% Senior Notes, 4.2% Senior Notes, and 3.95% Senior Notes bear interest at annual rates of interest of 2.75%, 4.2%, and 3.95%, respectively. Interest is payable on June 15 and December 15 for the 2.75% Senior Notes, September 15 and March 15 for the 4.2% Senior Notes, and June 15 and December 15 for the 3.95% Senior Notes, respectively.

Convertible Senior Notes

As of March 31, 2017, we had two outstanding issuances of convertible notes which are senior unsecured obligations and rank equal in right of payment to all other senior, unsecured, unsubordinated indebtedness. On March 4, 2016, we issued $500 million of convertible notes which mature on April 1, 2021 and bear interest at an annual rate of 2.5% (“2.5% Convertible Notes”). Subsequently, and in connection with the closing of the Blue Coat acquisition, we issued an additional $1.25 billion of convertible notes which mature on August 15, 2021 and bear interest at an annual rate of 2.0% (“2.0% Convertible Notes”). Both the 2.5% Convertible Notes and the 2.0% Convertible Notes (collectively, “Convertible Senior Notes”) have coupon interest payable semiannually in arrears in cash. Interest payments on the Convertible Senior Notes will be due on October 1 and April 1 of each year in the case of the 2.5% Convertible Notes, and February 15 and August 15 in the case of the 2.0% Convertible Notes. Any debt issuance costs for our Convertible Senior Notes have been recorded as a reduction to the Convertible Senior Notes on our Consolidated Balance Sheet as of March 31, 2017, and are being amortized as interest expense. In addition, the fair value of the equity component of our Convertible Senior Notes of $41 million, net of tax was recorded in additional paid-in capital and is also being amortized as interest expense.

Noteholders of the Convertible Senior Notes may convert the notes into our common stock at any time up to the maturity date of each note. The conversion rate for the 2.0% Convertible Notes is 48.9860 shares of common stock per $1,000 principal amount of the notes, which represents an initial conversion price of approximately $20.41 per share. The conversion rate for the 2.5% Convertible Notes is 59.6341 shares of common stock per $1,000 principal amount of the notes, which represents an initial conversion price of approximately $16.77 per share. If holders of the Convertible Senior Notes convert them in connection with a fundamental change, we may be required to provide a make-whole premium in the form of an increased conversion rate, subject to a maximum amount, based on the effective date of the fundamental change as set forth in a table contained in the indenture governing each of the Convertible Senior Notes. A fundamental change, as defined in each of the indentures governing the Convertible Senior Notes, includes a sale of substantially all the Company’s assets, a change of the control of the Company, or a plan for the Company’s liquidation or dissolution. The conversion rates under the Convertible Senior Notes are subject to customary anti-dilution adjustments.

As long as the holders of the Convertible Senior Notes each own at least 4% of our common stock on an as-converted basis, they are entitled to nominate one director to our Board of Directors. As of March 31, 2017, the holders’ percentage interest in our common stock exceeded this threshold. If the Noteholders request a conversion, we have the option to settle the par amount of the Convertible Senior Notes using cash, shares or a combination of cash and shares.

We may redeem the 2.5% Convertible Senior Notes at our option upon the 4-year anniversary of the issuance date of the 2.5% Convertible Senior Notes. The 2.0% Convertible Senior Notes are not redeemable at our option.

Note 9. Fair Value Measurements

Assets measured and recorded at fair value on a recurring basis

Our cash equivalents consist primarily of money market funds with original maturities of three months or less at the time of purchase, and the carrying amount is a reasonable estimate of fair value. Our short-term investments consist of investment securities with original maturities greater than three months and marketable equity securities, and are included in our other current assets in the Consolidated Balance Sheets.

The following table summarizes our assets measured at fair value on a recurring basis:

	March 31, 2017												April 1, 2016
(In millions)	Fair Value				Cash and Cash Equivalents				Short-term Investments				Fair Value				Cash and Cash Equivalents				Short-term Investments
Cash	$	1,183			$	1,183			$	—			$	1,072			$	1,072			$	—
Non-negotiable certificates of deposit	15				15				—				1				—				1
Level 1:
Money market	2,532				2,532				—				2,905				2,905				—
U.S. government securities	94				94				—				335				310				25
Marketable equity securities	9				—				9				11				—				11
Total level 1	2,635				2,626				9				3,251				3,215				36
Level 2:
Corporate bonds	—				—				—				45				43				2
U.S. agency securities	75				75				—				526				523				3
Commercial paper	348				348				—				1,121				1,121				—
Negotiable certificates of deposit	—				—				—				9				9				—
Total level 2	423				423				—				1,701				1,696				5
Total	$	4,256			$	4,247			$	9			$	6,025			$	5,983			$	42

There were no transfers between fair value measurement levels during fiscal 2017.

Fair value of debt

As of March 31, 2017 and April 1, 2016, the total fair value of our current and long-term debt was $8.3 billion and $2.3 billion, respectively, based on Level 2 inputs.

EQUITY & OTHER

Note 10. Stockholders’ Equity

Dividends

The following table summarizes dividends declared and paid and dividend equivalents paid for the periods presented:

	Year Ended
(In millions, except per share data)	March 31, 2017				April 1, 2016				April 3, 2015
Dividends declared and paid	$	186			$	3,020			$	408
Dividend equivalents paid	36				10				5
Total dividends and dividend equivalents paid	$	222			$	3,030			$	413
Cash dividends declared per common share	$	0.30			$	4.60			$	0.60

Fiscal 2016 included a special dividend of $4.00 per share that was declared and paid during the fourth quarter of fiscal 2016 and was recorded as a reduction of retained earnings. Our RSUs and PRUs are entitled to dividend equivalents to be paid in the form of cash upon vesting for each share of the underlying unit.

On May 10, 2017, we declared a cash dividend of $0.075 per share of common stock to be paid on June 21, 2017 to all stockholders of record as of the close of business on June 7, 2017. All shares of common stock issued and outstanding and unvested RSUs and PRUs as of the record date will be entitled to the dividend and dividend equivalents, respectively. Any future dividends and dividend equivalents will be subject to the approval of our Board of Directors.

Shares outstanding

Shares of our common stock outstanding were as follows:

	Year Ended
(In millions)	March 31, 2017			April 1, 2016			April 3, 2015
Balance, beginning of year	612			684			695
Common stock issued under employee stock plans	14			12			10
Direct stock purchase	3			—			—
Repurchases of common stock	(21	)		(84	)		(21	)
Balance, end of year	608			612			684

Stock repurchases

Under our stock repurchase programs, we may purchase shares of our outstanding common stock through open market and through accelerated stock repurchase (“ASR”) transactions. On November 20, 2016, our Board of Directors increased the authorization under our stock repurchase program by $510 million, bringing the total authorization to $1.3 billion for stock repurchases. The Board of Directors also authorized up to $500 million of the $1.3 billion to be expended before March 31, 2017. In March 2017, we entered into an ASR agreement with financial institutions (the “March 2017 ASR”) to repurchase an aggregate $500 million of our common stock. The remaining $800 million authorization, to be completed in future periods, does not have an expiration date.

Repurchases on open market transactions

The following table summarizes our stock repurchases on open market transactions for the periods presented and excludes the impact of shares purchased under our ASR agreements (except for the remaining authorization amount):

	Year Ended
(In millions, except per share data)	March 31, 2017				April 1, 2016				April 3, 2015
Total number of shares repurchased	—				17				21
Dollar amount of shares repurchased	$	—			$	368			$	500
Average price paid per share	$	—			$	21.69			$	23.73
Remaining authorization at end of period	$	800			$	790			$	1,158

Accelerated stock repurchase agreements

Pursuant to the March 2017 ASR, we made an upfront payment of $500 million and received and retired an initial delivery of 14.2 million shares of our common stock in March 2017. On May 19, 2017, which was in our first quarter of fiscal 2018, the ASR was completed, which, per the terms of the agreements, resulted in us receiving an additional 2.2 million shares of our common stock. The total shares received under the terms of the ASR were 16.4 million, with an average price paid per share of $30.51.

In March 2016, we entered into an ASR agreement with financial institutions (the “March 2016 ASR”) to repurchase an aggregate of $1.0 billion of our common stock. Pursuant to the March 2016 ASR, we made an upfront payment of $1.0 billion and received and retired an initial delivery of 42.4 million shares of our common stock in March 2016. We completed the repurchase and received an additional 6.5 million shares of our common stock in November 2016. The total shares received and retired under the terms of the March 2016 ASR were 48.9 million, with an average price paid per share of $20.44.

In November 2015, we entered into an ASR agreement with a financial institution (the “November 2015 ASR”) to repurchase an aggregate of $500 million of our common stock. Pursuant to the November 2015 ASR, we made an upfront payment of $500 million and received and retired an initial delivery of 19.9 million shares of our common stock in November 2016. We completed the repurchase and received an additional 5.0 million shares of our common stock in January 2016. The total shares received and retired under the terms of the November 2015 ASR were 24.9 million, with an average price paid per share of $20.08.

The upfront payment amounts for the ASRs are included in repurchases of common stock on our Consolidated Statements of Cash Flows for their respective periods.

Accumulated other comprehensive income

The changes in accumulated other comprehensive income (“AOCI”) by component, on a net of tax basis, were as follows:

(In millions)	Foreign Currency Translation Adjustments				Unrealized Gain On Available-For-Sale Securities				Total AOCI
Balance as of April 1, 2016	$	15			$	7			$	22
Other comprehensive loss before reclassifications	(8		)		(2		)		(10		)
Balance as of March 31, 2017	$	7			$	5			$	12

Note 11. Stock-Based Compensation

Stock incentive plans

2004 and 2013 Equity Incentive Plans

Under both the 2004 Equity Incentive Plan (“2004 Plan”) and the 2013 Equity Incentive Plan (“2013 Plan”) (collectively “the Equity Plans”), we have granted incentive and nonqualified stock options, stock appreciation rights, RSUs, restricted stock awards, and performance-based awards to employees, officers, directors, consultants, independent contractors, and advisors to us. These may also be granted to any parent, subsidiary, or affiliate of ours. The purpose of the Equity Plans has been to attract, retain, and motivate eligible persons whose present and potential contributions are important to our success by offering them an opportunity to participate in our future performance through equity awards. RSUs granted prior to November 2014 generally vest over a four-year period, whereas RSUs granted thereafter generally vest over a three-year period.

Upon adoption, our stockholders approved and reserved 45 million shares of common stock for issuance under the 2013 Plan. As of March 31, 2017, 28 million shares remained available for future grant.

2008 Employee Stock Purchase Plan

Beginning August 16, 2016, eligible employees are offered shares through a 12-month offering period, which consists of two consecutive 6-month purchase periods. Employees may annually contribute up to 10% of their gross compensation, subject to certain limitations, to purchase shares of our common stock at 85% of the lower of either its fair market value on the purchase date or the fair market value at the beginning of the offering period. Prior to August 16, 2016, employees were able to purchase shares of common stock at a price per share equal to 85% of the fair market value on the purchase date at the end of each six month purchase period. As of March 31, 2017, 31 million shares have been issued under this plan and 39 million shares remained available for future issuance.

Acquired plans

Blue Coat acquisition

In connection with the Blue Coat acquisition, we assumed the outstanding equity awards under two of Blue Coat’s equity incentive plans (the Blue Coat, Inc. 2016 Equity Incentive Plan and the Batman Holdings, Inc. 2015 Amended and Restated Equity Incentive Plan (collectively, the “Blue Coat Plans”)), including 7.5 million vested and 12.5 million unvested stock options, 4.8 million unvested RSUs, and 3.0 million unvested PRUs. The total fair value of options assumed was $265 million and the total fair value of RSUs and PRUs assumed was $162 million, before adjusting for estimated forfeitures. Upon vesting, these assumed options will be exercisable into, and these assumed RSUs and PRUs will settle into shares of our common stock. The assumed RSUs and PRUs generally retained the terms and conditions under which they were originally granted. We will not grant additional options or shares under the Blue Coat Plans. Future equity awards by Symantec will be made under our 2013 Plan, as amended. See Note 6 for more information on the Blue Coat acquisition.

Included in the aforementioned assumed Blue Coat equity awards were RSUs and PRUs granted to Gregory S. Clark, former Blue Coat CEO and our current CEO, in connection with the closing of the Blue Coat acquisition. These equity awards were assumed by Symantec on the close date for an equivalent of 1.3 million Symantec RSUs and 1.0 million PRUs. The RSUs vest at various times over 3-years and PRUs are subject to 2-year vesting and the achievement of certain performance metrics during the applicable performance period. These awards had a combined fair value of $46 million, before adjusting for estimated forfeitures, on the close date of the Blue Coat acquisition. In addition, Blue Coat had previously granted Mr. Clark stock options which were assumed by Symantec. Upon assumption of these options, Mr. Clark held 3.9 million unvested options to purchase our common stock with a fair value of $53 million on August 1, 2016, of which $50 million is being recognized as stock-based compensation expense over the 2-year vesting period and the remainder was included as part of the consideration transferred for the acquisition.

LifeLock acquisition

In connection with the LifeLock acquisition, we assumed the outstanding equity awards under LifeLock’s equity incentive plan (the LifeLock, Inc. 2012 Incentive Compensation Plan (the “LifeLock Plan”)), including 4.1 million unvested stock options and 3.1 million unvested RSUs. The total fair value of options assumed was $61 million and the total fair value of RSUs assumed was $91 million, before adjusting for estimated forfeitures. Upon vesting, these assumed options will be exercisable into, and these assumed RSUs will settle into shares of our common stock. The assumed RSUs generally retained the terms and conditions under which they were originally granted. We will not grant additional options or shares under the LifeLock Plan. Future equity awards by Symantec will be made under our 2013 Plan, as amended. See Note 6 for more information on the LifeLock acquisition.

Shares reserved

We reserved the following shares of authorized but unissued common stock:

(In millions)	March 31, 2017
Stock purchase plans	39
Stock award plans	76
Total	115

Stock-based compensation expense

The following table sets forth the total stock-based compensation expense recognized in our Consolidated Statements of Operations.

	Year Ended
(Dollars in millions)	March 31, 2017				April 1, 2016				April 3, 2015
Cost of revenue	$	21			$	10			$	15
Sales and marketing	107				53				46
Research and development	110				56				39
General and administrative	202				42				31
Total stock-based compensation expense from continuing operations	440				161				131
Tax benefit associated with stock-based compensation expense	(149		)		(50		)		(37		)
Net stock-based compensation expense from continuing operations	291				111				94
Net stock-based compensation expense from discontinued operations	—				56				46
Net stock-based compensation expense	$	291			$	167			$	140

Restricted stock units

(In millions, except per share and year data)	Number of Shares			Weighted- Average Grant Date Fair Value				Weighted- Average Remaining Years		Aggregate Intrinsic Value
Outstanding at April 1, 2016	17			$	22.72
Granted and assumed	18			$	20.56
Vested and released	(8	)		$	22.54
Forfeited	(4	)		$	21.45
Outstanding and unvested at March 31, 2017	23			$	21.26			1.1		$	692
Expected to vest at March 31, 2017	19							1.0		$	573

The weighted-average grant date fair value per share of RSUs granted during fiscal 2017, 2016, and 2015, including assumed RSUs was $20.56, $23.20, and $22.66, respectively. The total fair value of RSUs that vested and was released in fiscal 2017, 2016, and 2015 was $181 million, $250 million and $133 million, respectively.

As of March 31, 2017, total unrecognized compensation cost related to RSUs was $278 million, net of estimated forfeitures, which is expected to be recognized over the remaining weighted-average vesting period of 1.8 years.

Performance-based restricted stock units

(In millions, except per share and year data)	Number of Shares			Weighted- Average Grant Date Fair Value				Weighted- Average Remaining Years		Aggregate Intrinsic Value
Outstanding at April 1, 2016	2			$	27.13
Granted and assumed	5			$	19.99
Vested and released	(1	)		$	28.76
Outstanding and unvested at March 31, 2017	6			$	21.05			1.0		$	181
Expected to vest at March 31, 2017	5							1.0		$	166

The weighted-average grant date fair value per share of performance-based restricted stock granted during fiscal 2017, 2016, and 2015, including assumed performance-based restricted stock was $19.99, $27.10, and $26.30, respectively. The total fair value of restricted stock that vested and was released in fiscal 2017, 2016, and 2015 was $14 million, $9 million, and $23 million, respectively.

As of March 31, 2017, total unrecognized compensation cost related to PRUs was $172 million, net of estimated forfeitures, which is expected to be recognized over the remaining weighted-average vesting period of 1.0 years.

Stock options

(In millions, except per share and year data)	Number of Shares			Weighted- Average Exercise Price				Weighted- Average Remaining Years		Aggregate Intrinsic Value
Outstanding at April 1, 2016	—			$	—
Assumed	24			$	8.77
Exercised	(4	)		$	7.93
Outstanding and unvested at March 31, 2017	20			$	8.94
Exercisable at March 31, 2017	7							8.3 years		$	164
Vested and expected to vest at March 31, 2017	18							8.4 years		$	392

The total intrinsic value of options exercised during fiscal 2017 was $78 million. As of March 31, 2017, total unrecognized compensation cost adjusted for estimated forfeitures related to unvested stock options was $147 million, net of estimated forfeitures, which is expected to be recognized over the remaining weighted-average vesting period of 1.7 years.

Valuation of stock options

The following assumptions were used to estimate the fair value of stock options assumed in the Blue Coat and LifeLock acquisitions during fiscal 2017:

Expected life	5.0 years
Weighted-average expected volatility	26.25	%
Weighted-average risk-free interest	1.22	%
Expected dividend yield	1.39	%

Note 12. Commitments and Contingencies

Lease commitments

We lease certain of our facilities, equipment, and co-locations under operating leases that expire at various dates through fiscal 2026. We currently sublease some space under various operating leases that will expire on various dates through fiscal 2023. Some of our leases contain renewal options, escalation clauses, rent concessions, and leasehold improvement incentives. Rent expense under operating leases was $79 million, $103 million, and $113 million for fiscal 2017, 2016, and 2015, respectively.

The minimum future rentals on non-cancelable operating leases by fiscal year are as follows:

(In millions)		March 31, 2017
2018		$	88
2019		74
2020		51
2021		43
2022		30
Thereafter		41
Total minimum future lease payments		327
Sublease income		(48		)
Total minimum future lease payments, net		$	279

Purchase obligations

We have purchase obligations that are associated with agreements for purchases of goods or services. Management believes that cancellation of these contracts is unlikely and we expect to make future cash payments according to the contract terms.

The following reflects unrecognized purchase obligations by fiscal year:

(In millions)		March 31, 2017
2018		$	125
2019		28
2020		1
Thereafter		—
Total purchase obligations		$	154

Indemnifications

In the ordinary course of business, we may provide indemnifications of varying scope and terms to customers, vendors, lessors, business partners, subsidiaries and other parties with respect to certain matters, including, but not limited to, losses arising out of our breach of agreements or representations and warranties made by us. In addition, our bylaws contain indemnification obligations to our directors, officers, employees and agents, and we have entered into indemnification agreements with our directors and certain of our officers to give such directors and officers additional contractual assurances regarding the scope of the indemnification set forth in our bylaws and to provide additional procedural protections. We maintain director and officer insurance, which may cover certain liabilities arising from our obligation to indemnify our directors and officers. It is not possible to determine the aggregate maximum potential loss under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Such indemnification agreements might not be subject to maximum loss clauses. Historically, we have not incurred material costs as a result of obligations under these agreements and we have not accrued any liabilities related to such indemnification obligations in our Consolidated Financial Statements.

In connection with the sale of Veritas, we assigned several leases to Veritas Technologies LLC or its related subsidiaries. As a condition to consenting to the assignments, certain lessors required us to agree to indemnify the lessor under the applicable lease with respect to certain matters, including, but not limited to, losses arising out of Veritas Technologies LLC or its related subsidiaries’ breach of payment obligations under the terms of the lease. As with our other indemnification obligations discussed above and in general, it is not possible to determine the aggregate maximum potential loss under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. As with our other indemnification obligations, such indemnification agreements might not be subject to maximum loss clauses and to date, generally under our real estate obligations, we have not incurred material costs as a result of such obligations under our leases and have not accrued any liabilities related to such indemnification obligations in our Consolidated Financial Statements.

We provide limited product warranties and the majority of our software license agreements contain provisions that indemnify licensees of our software from damages and costs resulting from claims alleging that our software infringes on the intellectual property rights of a third party. Historically, payments made under these provisions have been immaterial. We monitor the conditions that are subject to indemnification to identify if a loss has occurred.

Litigation contingencies

GSA

During the first quarter of fiscal 2013, we were advised by the Commercial Litigation Branch of the Department of Justice’s (“DOJ”) Civil Division and the Civil Division of the U.S. Attorney’s Office for the District of Columbia that the government is investigating our compliance with certain provisions of our U.S. General Services Administration (“GSA”) Multiple Award Schedule Contract No. GS-35F-0240T effective January 24, 2007, including provisions relating to pricing, country of origin, accessibility, and the disclosure of commercial sales practices.

As reported on the GSA’s publicly-available database, our total sales under the GSA Schedule contract were approximately $222 million from the period beginning January 2007 and ending September 2012. We have fully cooperated with the government throughout its investigation and in January 2014, representatives of the government indicated that their initial analysis of our actual damages exposure from direct government sales under the GSA schedule was approximately $145 million; since the initial meeting, the government’s analysis of our potential damages exposure relating to direct sales has increased. The government has also indicated they are going to pursue claims for certain sales to California, Florida, and New York as well as sales to the federal government through reseller GSA Schedule contracts, which could significantly increase our potential damages exposure.

In 2012, a sealed civil lawsuit was filed against Symantec related to compliance with the GSA Schedule contract and contracts with California, Florida, and New York. On July 18, 2014, the Court-imposed seal expired, and the government intervened in the lawsuit. On September 16, 2014, the states of California and Florida intervened in the lawsuit, and the state of New York notified the Court that it would not intervene. On October 3, 2014, the DOJ filed an amended complaint, which did not state a specific damages amount. On October 17, 2014, California and Florida combined their claims with those of the DOJ and the relator on behalf of New York in an Omnibus Complaint, and a First Amended Omnibus Complaint was filed on October 8, 2015; the state claims also do not state specific damages amounts.

It is possible that the litigation could lead to claims or findings of violations of the False Claims Act, and could be material to our results of operations and cash flows for any period. Resolution of False Claims Act investigations can ultimately result in the payment of somewhere between one and three times the actual damages proven by the government, plus civil penalties in some cases, depending upon a number of factors. Our current estimate of the low end of the range of the probable estimated loss from this matter is $25 million, which we have accrued. This amount contemplates estimated losses from both the investigation of compliance with the terms of the GSA Schedule contract as well as possible violations of the False Claims Act. There is at least a reasonable possibility that a loss may have been incurred in excess of our accrual for this matter, however, we are currently unable to determine the high end of the range of estimated losses resulting from this matter.

EDS & NDI

On January 24, 2011, a class action lawsuit was filed against us and our previous e-commerce vendor Digital River, Inc.; the lawsuit alleged violations of California’s Unfair Competition Law, the California Legal Remedies Act and unjust enrichment related to prior sales of Extended Download Service (“EDS”) and Norton Download Insurance (“NDI”). On March 31, 2014, the U.S. District Court for the District of Minnesota certified a class of all people who purchased these products between January 24, 2005 and March 10, 2011. In August 2015, the parties executed a settlement agreement pursuant to which we would pay the plaintiffs $30 million, which we accrued. On October 8, 2015, the Court granted preliminary approval of the settlement, which was subsequently paid into escrow by us. The Court granted final approval on April 22, 2016, and entered judgment in the case. Objectors to the settlement have appealed to the Eighth Circuit Court of Appeals, challenging the Court’s approval of the settlement.

Finjan

On August 28, 2013, Finjan, Inc. (“Finjan”) filed a complaint against Blue Coat Systems, Inc. in the U.S. District Court for the Northern District of California alleging that certain Blue Coat products infringe six of Finjan’s U.S. patents. On August 4, 2015, a jury returned a verdict that certain Blue Coat products infringe five of the Finjan patents-in-suit and awarded Finjan lump-sum damages of $40 million. On November 20, 2015, the trial court entered a judgment in favor of Finjan on the jury verdict and certain non-jury legal issues. On July 28, 2016, in its ruling on post-trial motions the trial court denied Blue Coat’s motions seeking a new trial or judgment as a matter of law and denied Finjan’s request for enhanced damages and attorneys’ fees. In August 2016, we completed our acquisition of Blue Coat. We intend to vigorously contest the judgment and have filed an appeal with the Federal Circuit Court of Appeals. Our current best estimated loss and related interest with respect to the jury verdict is $40 million, which was accrued by Blue Coat and assumed by us as a part of the acquisition of Blue Coat.

Other

We are involved in a number of other judicial and administrative proceedings that are incidental to our business. Although adverse decisions (or settlements) may occur in one or more of the cases, it is not possible to estimate the possible loss or losses from each of these cases. The final resolution of these lawsuits, individually or in the aggregate, is not expected to have a material adverse effect on our business, results of operations, financial condition or cash flows.

Note 13. Discontinued Operations

On January 29, 2016, we completed the sale of Veritas. The results of Veritas are presented as discontinued operations in our Consolidated Statements of Operations and thus have been excluded from continuing operations and segment results for all reported periods.

In connection with the divestiture of Veritas, the Company and Veritas entered into Transition Service Agreements (“TSA”) pursuant to which the Company provides Veritas certain limited services including financial support services, information technology services, and access to facilities, and Veritas provides the Company certain limited financial support services. The TSAs commenced with the close of the transaction and expire at various dates through fiscal 2019. During fiscal 2017 and fiscal 2016, we recorded income of approximately $22 million and $8 million, respectively, for all services provided to Veritas, which is presented as part of other income, net in the Consolidated Statements of Operations.

We also have retained various customer relationships and contracts that were reported historically as a part of the Veritas business. Approximately $71 million and $330 million related to these relationships and contracts have been reported as part of our deferred revenue in the Consolidated Balance Sheet as of March 31, 2017 and April 1, 2016, respectively, along with an asset representing the service and maintenance rights we have under an agreement with Veritas of $41 million and $131 million, respectively. These balances will be amortized to discontinued operations through the remaining term of the underlying contracts.

The following table presents information regarding certain components of income from discontinued operations, net of income taxes:

	Year Ended
(In millions)	March 31, 2017				April 1, 2016				April 3, 2015
Net revenues	$	172			$	1,968			$	2,552
Cost of revenues	(15		)		(334		)		(426		)
Operating expenses	(26		)		(1,270		)		(1,131		)
Gain on sale of Veritas	31				4,060				—
Other income (expense), net	1				3				(3		)
Income from discontinued operations before income taxes	163				4,427				992
Provision for income taxes	33				1,118				223
Income from discontinued operations, net of income taxes	$	130			$	3,309			$	769

During fiscal 2017 we received additional payments which represented purchase price adjustments for the sale of Veritas.

Note 14. Subsequent Event

Subsequent to March 31, 2017, we prepaid $710 million of our Senior Term Loan A-5 and $100 million of our Senior Term Loan A-1 on April 5, 2017 and May 5, 2017, respectively.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Mountain View, State of California, on the 19th day of May 2017.

	SYMANTEC CORPORATION
	By:	/s/ Gregory S. Clark
		Gregory S. Clark Chief Executive Officer and Director

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Gregory S. Clark, Nicholas R. Noviello and Scott C. Taylor, and each or any of them, his attorneys-in-fact, each with the power of substitution, for him in any and all capacities to sign any and all amendments to this report on Form 10-K and any other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that such attorneys-in-fact, or his or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. This Power of Attorney may be signed in several counterparts.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated below.

Signature		Title		Date
/s/ Gregory S. Clark		Chief Executive Officer and Director (Principal Executive Officer)		May 19, 2017
Gregory S. Clark
/s/ Nicholas R. Noviello		Executive Vice President and Chief Financial Officer (Principal Financial Officer)		May 19, 2017
Nicholas R. Noviello
/s/ Mark S. Garfield		Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)		May 19, 2017
Mark S. Garfield
/s/ Daniel H. Schulman		Chairman of the Board		May 19, 2017
Daniel H. Schulman
/s/ Frank E. Dangeard		Director		May 19, 2017
Frank E. Dangeard
/s/ Kenneth Y. Hao		Director		May 19, 2017
Kenneth Y. Hao
/s/ David W. Humphrey		Director		May 19, 2017
David W. Humphrey
/s/ Geraldine B. Laybourne		Director		May 19, 2017
Geraldine B. Laybourne
/s/ David L. Mahoney		Director		May 19, 2017
David L. Mahoney
/s/ Robert S. Miller		Director		May 19, 2017
Robert S. Miller
/s/ Anita M. Sands		Director		May 19, 2017
Anita M. Sands
/s/ V. Paul Unruh		Director		May 19, 2017
V. Paul Unruh
/s/ Suzanne M. Vautrinot		Director		May 19, 2017
Suzanne M. Vautrinot

Schedule II

SYMANTEC CORPORATION

VALUATION AND QUALIFYING ACCOUNTS

All financial statement schedules have been omitted, since the required information is not applicable or is not present in material amounts, and/or changes to such amounts are immaterial to require submission of the schedule, or because the information required is included in the Consolidated Financial Statements and notes thereto included in this Form 10-K.

EXHIBIT INDEX

Exhibit Number				Incorporated by Reference								Filed Herewith
Exhibit Description		Form		File No.		Exhibit		Filing Date
2.01(§)		Purchase Agreement dated as of August 11, 2015, by and between Symantec Corporation and Havasu Holdings Ltd.		8-K		000-17781		2.01		8/13/2015
2.02		Amendment, dated January 19, 2016, to the Purchase Agreement dated as of August 11, 2015, by and between Symantec Corporation and Veritas Holdings Ltd. (f/k/a Havasu Holdings Ltd.)		8-K		000-17781		2.01		1/20/2016
2.03(§)		Agreement and Plan of Merger, dated as of June 12, 2016, by and among Symantec Corporation, S-B0616 Merger Sub, Inc. and Blue Coat, Inc.		8-K		000-17781		2.01		6/14/2016
2.04		Investment Agreement, dated as of June 12, 2016, by and among Symantec Corporation, Bain Capital Fund XI, L.P., Bain Capital Europe Fund IV, L.P. and Silver Lake Partners IV Cayman (AIV II), L.P. (including the form of Indenture attached as Exhibit A thereto).		8-K		000-17781		2.02		6/14/2016
2.05		Amendment to Investment Agreement, dated as of July 31, 2016, by and among Symantec Corporation, Bain Capital Fund XI, L.P., Bain Capital Europe Fund IV, L.P. and Silver Lake Partners IV Cayman (AIV II), L.P.		10-Q		000-17781		2.03		8/5/2016
2.06(§)(**)		Agreement and Plan of Merger, dated as of November 20, 2016, by and among Symantec Corporation, L1116 Merger Sub, Inc. and LifeLock, Inc.		8-K		001-35671		2.01		11/21/2016
2.07(**)		Amendment No. 1 to Agreement and Plan of Merger, dated as of January 16, 2017, by and among Symantec Corporation, L1116 Merger Sub, Inc. and LifeLock, Inc.		8-K		001-35671		2.01		1/17/2017
2.08		Form of Support Agreement by and among Symantec Corporation and the stockholders of LifeLock, Inc. listed on Annex A therein.		8-K		000-17781		2.02		11/21/2016
3.01		Amended and Restated Certificate of Incorporation of Symantec Corporation.		S-8		333-119872		4.01		10/21/2004
3.02		Certificate of Amendment of Amended and Restated Certificate of Incorporation of Symantec Corporation.		S-8		333-126403		4.03		7/6/2005
3.03		Certificate of Amendment to Amended and Restated Certificate of Incorporation of Symantec Corporation.		10-Q		000-17781		3.01		8/5/2009

Exhibit Number				Incorporated by Reference								Filed Herewith
Exhibit Description		Form		File No.		Exhibit		Filing Date
3.04		Certificate of Designations of Series A Junior Preferred Stock of Symantec Corporation dated June 25, 2015.		8-K		000-17781		3.01		6/26/2015
3.05		Bylaws, as amended, of Symantec Corporation.										X
4.01		Form of Common Stock Certificate.		S-3ASR		333-139230		4.07		12/11/2006
4.02		Indenture, dated September 16, 2010, between Symantec Corporation and Wells Fargo Bank, National Association, as trustee.		8-K		000-17781		4.01		9/16/2010
4.03		Form of Global Note for Symantec’s 4.200% Senior Note due 2020 (contained in Exhibit No. 4.02 of Form 8-K).		8-K		000-17781		4.04		9/16/2010
4.04		Form of Global Note for Symantec’s 2.750% Senior Notes due 2017 (contained in Exhibit No. 4.02 of Form 8-K).		8-K		000-17781		4.03		6/14/2012
4.05		Form of Global Note for Symantec’s 3.950% Senior Notes due 2022 (contained in Exhibit No. 4.02 of Form 8-K).		8-K		000-17781		4.04		6/14/2012
4.06		Indenture, dated as of March 4, 2016, by and between Symantec Corporation and Wells Fargo Bank, National Association, as trustee (including the form of 2.500% Convertible Senior Notes Due 2021).		8-K		000-17781		10.02		3/7/2016
4.07		Amendment Agreement, dated as of July 18, 2016, by and among Symantec Corporation, Symantec Operating Corporation, the Lenders and the New Term Lenders, Wells Fargo Bank, National Association, and JPMorgan Chase Bank, N.A.		10-Q		000-17781		4.02		8/5/2016
4.08		Amended and Restated Credit Agreement, effective as of August 1, 2016, among Symantec Corporation, the lenders party thereto (the “Lenders”), Wells Fargo Bank, National Association, as Term Loan A-1/Revolver Administrative Agent and Swingline Lender, JPMorgan Chase Bank, N.A., as Term Loan A-2 Administrative Agent, JPMorgan Chase Bank, N.A., Merrill Lynch, Pierce, Fenner & Smith, Incorporated, Barclays Bank PLC, Citigroup Global Markets Inc., Wells Fargo Securities, LLC, Royal Bank of Canada and Mizuho Bank, Ltd., as Lead Arrangers and Joint Bookrunners in respect of the Term A-2 Facility, Barclays Bank PLC, Citibank, N.A., Wells Fargo Bank, National Association, Royal Bank of Canada, Mizuho Bank, Ltd. And TD Securities (USA) LLC, as Co-Documentation Agents in respect of the Term A-2 Facility, and Bank of America, N.A., as Syndication Agent in respect of Term A-2 Facility.		10-Q		000-17781		4.03		8/5/2016
4.09		Indenture, dated as of August 1, 2016, by and between Symantec Corporation and Wells Fargo Bank, National Association, as trustee (including the form of 2.00% Convertible Senior Note Due 2021).		10-Q		000-17781		4.04		8/5/2016

Exhibit Number				Incorporated by Reference								Filed Herewith
Exhibit Description		Form		File No.		Exhibit		Filing Date
4.10		Term Loan Agreement, dated as of August 1, 2016, among Symantec Corporation, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., as Syndication Agent, and Barclays Bank PLC, Citibank, N.A., Wells Fargo Bank, National Association, Royal Bank of Canada, Mizuho Bank, Ltd., and TD Securities (USA) LLC, as Co-Documentation Agents, JPMorgan Chase Bank, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Bank, PLC, Citigroup Global Markets Inc., Wells Fargo Securities, LLC, Royal Bank of Canada and Mizuho Bank, Ltd., as Joint Lead Arrangers and Joint Bookrunners.		10-Q		000-17781		4.05		8/5/2016
4.11		Assignment and Assumption, dated October 3, 2016, to the Term Loan Agreement dated as of August 1, 2016, among Symantec Corporation, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., as Syndication Agent, and Barclays Bank PLC, Citibank, N.A., Wells Fargo Bank, National Association, Royal Bank of Canada, Mizuho Bank, Ltd., and TD Securities (USA) LLC, as Co-Documentation Agents, JPMorgan Chase Bank, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Bank, PLC, Citigroup Global Markets Inc., Wells Fargo Securities, LLC, Royal Bank of Canada and Mizuho Bank, Ltd., as Joint Lead Arrangers and Joint Bookrunners.		10-Q		000-17781		4.01		2/3/2017
4.12		First Amendment, dated December 12, 2016, to the Term Loan Agreement, dated as of August 1, 2016, among Symantec Corporation, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., as Syndication Agent, and Barclays Bank PLC, Citibank, N.A., Wells Fargo Bank, National Association, Royal Bank of Canada, Mizuho Bank, Ltd., and TD Securities (USA) LLC, as Co-Documentation Agents, JPMorgan Chase Bank, N.A., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Barclays Bank, PLC, Citigroup Global Markets Inc., Wells Fargo Securities, LLC, Royal Bank of Canada and Mizuho Bank, Ltd., as Joint Lead Arrangers and Joint Bookrunners.		10-Q		000-17781		4.02		2/3/2017

Exhibit Number				Incorporated by Reference								Filed Herewith
Exhibit Description		Form		File No.		Exhibit		Filing Date
4.13		First Amendment, dated December 12, 2016, to the Credit Agreement, effective as of August 1, 2016, among Symantec Corporation, the lenders party thereto (the “Lenders”), Wells Fargo Bank, National Association, as Term Loan A-1/Revolver Administrative Agent and Swingline Lender, JPMorgan Chase Bank, N.A., as Term Loan A-2 Administrative Agent, JPMorgan Chase Bank, N.A., Merrill Lynch, Pierce, Fenner & Smith, Incorporated, Barclays Bank PLC, Citigroup Global Markets Inc., Wells Fargo Securities, LLC, Royal Bank of Canada and Mizuho Bank, Ltd., as Lead Arrangers and Joint Bookrunners in respect of the Term A-2 Facility, Barclays Bank PLC, Citibank, N.A., Wells Fargo Bank, National Association, Royal Bank of Canada, Mizuho Bank, Ltd. And TD Securities (USA) LLC, as Co-Documentation Agents in respect of the Term A-2 Facility, and Bank of America, N.A., as Syndication Agent in respect of Term A-2 Facility.		10-Q		000-17781		4.03		2/3/2017
4.14		Base Indenture, dated as of February 9, 2017, between Symantec Corporation and Wells Fargo Bank, National Association, as trustee.		8-K		000-17781		4.01		2/9/2017
4.15		First Supplemental Indenture related to the 5% Senior Notes due 2025, dated as of February 9, 2017, between Symantec Corporation and Wells Fargo Bank, National Association, as trustee (including form of 5.00% Senior Note due 2025).		8-K		000-17781		4.02		2/9/2017
10.01(*)		Form of Indemnification Agreement for Officers and Directors, as amended (form for agreements entered into prior to January 17, 2006).		S-1		33-28655		10.17		6/21/1989
10.02(*)		Form of Indemnification Agreement for Officers, Directors and Key Employees (form for agreements entered into between January 17, 2006 and March 6, 2016).		8-K		000-17781		10.01		1/23/2006
10.03(*)		Form of Indemnification Agreement for Officers, Directors and Key Employees, as amended (form for agreements entered into after March 6, 2016).		8-K		000-17781		10.03		3/7/2016
10.04(*)		Symantec Corporation 1996 Equity Incentive Plan, as amended, including form of Stock Option Agreement and form of Restricted Stock Purchase Agreement.		10-K		000-17781		10.05		6/9/2006
10.05(*)		Symantec Corporation Deferred Compensation Plan, restated and amended January 1, 2010, as adopted December 15, 2009.		10-K		000-17781		10.05		5/24/2010
10.06(*)		Brightmail Inc. 1998 Stock Option Plan, including form of Stock Option Agreement and form of Notice of Assumption.		10-K		000-17781		10.08		6/9/2006
10.07(*)		Symantec Corporation 2000 Director Equity Incentive Plan, as amended.		10-Q		000-17781		10.01		11/1/2011

Exhibit Number				Incorporated by Reference								Filed Herewith
Exhibit Description		Form		File No.		Exhibit		Filing Date
10.08(*)		Vontu, Inc. 2002 Stock Option/Stock Issuance Plan, as amended.		10-K		000-17781		10.10		5/20/2016
10.09(*)		Form of Vontu, Inc. Stock Option Agreement.		S-8		333-148107		99.03		12/17/2007
10.10(*)		Symantec Corporation 2004 Equity Incentive Plan, as amended, including Stock Option Grant - Terms and Conditions, form of RSU Award Agreement, form of RSU Award Agreement for Non-Employee Directors and form of PRU Award Agreement.		10-K		000-17781		10.13		5/20/2016
10.11(*)		Symantec Corporation 2008 Employee Stock Purchase Plan, as amended.		10-Q		000-17781		10.01		2/4/2016
10.12(*)		Symantec Corporation 2013 Equity Incentive Plan, as amended, including form of Stock Option Grant - Terms and Conditions and form of RSU Award Agreement.		S-8		333-216132		99.01		2/17/2017
10.13(*)		Form of Symantec Corporation Performance Based Restricted Stock Unit Award Agreement under 2013 Equity Incentive Plan.		10-Q		000-17781		10.07		8/5/2016
10.14(*)		Blue Coat, Inc. 2016 Equity Incentive Plan, including forms of awards thereunder.		S-8		333-212847		99.01		8/2/2016
10.15(*)		Batman Holdings, Inc. 2015 Amended and Restated Equity Incentive Plan, including form of Stock Option Agreement thereunder.		S-8		333-212847		99.02		8/2/2016
10.16(*)		LifeLock, Inc. 2012 Incentive Compensation Plan and forms of option and restricted stock unit award agreements thereunder.		S-8		333-216132		99.02		2/17/2017
10.17(*)		Symantec Senior Executive Incentive Plan, as amended and restated.		8-K		000-17781		10.03		10/25/2013
10.18(*)		Symantec Corporation Executive Retention Plan, as amended and restated.		10-K		000-17781		10.18		5/22/2015
10.19(*)		Symantec Corporation Executive Severance Plan.		10-K		000-17781		10.19		5/22/2015
10.20(*)		Employment Offer Letter, dated February 3, 2014, between Symantec Corporation and Mark Garfield.		8-K		000-17781		10.01		3/10/2014
10.21(*)		Amended Executive Employment Agreement, dated April 28, 2016, by and between Symantec Corporation and Michael A. Brown.		10-K		000-17781		10.26		5/20/2016
10.22(*)		Employment Offer Letter, dated April 27, 2016, between Symantec Corporation and Ajei Gopal.		10-K		000-17781		10.27		5/20/2016
10.23(*)		Employment Letter dated as of June 12, 2016 by and between Gregory S. Clark, Symantec Corporation and Blue Coat, Inc.		10-Q		000-17781		10.03		8/5/2016
10.24(*)		Offer letter dated as of June 12, 2016 by and between Michael Fey and Symantec Corporation.		10-Q		000-17781		10.04		8/5/2016
10.25(*)		Employment Offer letter, dated as of June 12, 2016, by and between Nicholas Noviello and Symantec Corporation.		8-K		000-17781		10.01		11/4/2016

Exhibit Number				Incorporated by Reference								Filed Herewith
Exhibit Description		Form		File No.		Exhibit		Filing Date
10.26(*)		FY17 Executive Annual Incentive Plan - Senior Vice President and Executive Vice President.		10-Q		000-17781		10.06		8/5/2016
10.27(*)		FY17 Executive Annual Incentive Plan - Chief Executive Officer.		10-Q		000-17781		10.05		8/5/2016
10.28		Assignment of Copyright and Other Intellectual Property Rights, by and between Peter Norton and Peter Norton Computing, Inc., dated August 31, 1990.		S-4		33-35385		10.37		6/13/1990
10.29(†)		Environmental Indemnity Agreement, dated April 23, 1999, between Veritas and Fairchild Semiconductor Corporation, included as Exhibit C to that certain Agreement of Purchase and Sale, dated March 29, 1999, between Veritas and Fairchild Semiconductor of California.		S-1/A		333-83777		10.27 Exhibit C		8/6/1999
10.30		Amendment, dated June 20, 2007, to the Amended and Restated Agreement Respecting Certain Rights of Publicity dated as of August 31, 1990, by and between Peter Norton and Symantec Corporation.		10-Q		000-17781		10.01		8/7/2007
10.31		Amendment, effective December 6, 2010, to the Trademark License Agreement, dated August 9, 2010, by and between VeriSign, Inc. and Symantec Corporation.		10-Q		000-17781		10.01		2/2/2011
10.32		Investment Agreement, dated as of February 3, 2016, by and among Symantec Corporation and Silver Lake Partners IV Cayman (AIV II), L.P.		8-K		000-17781		10.01		2/9/2016
10.33		First Amendment to Investment Agreement, dated as of March 2, 2016, by and among Symantec Corporation and Silver Lake Partners IV Cayman (AIV II), L.P.		8-K		000-17781		10.01		3/7/2016
21.01		Subsidiaries of Symantec Corporation.										X
23.01		Consent of Independent Registered Public Accounting Firm.										X
24.01		Power of Attorney (see Signature page to this annual report).										X
31.01		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.										X
31.02		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.										X
32.01(††)		Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.										X
32.02(††)		Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.										X
101.INS		XBRL Instance Document										X
101.SCH		XBRL Taxonomy Schema Linkbase Document										X
101.CAL		XBRL Taxonomy Calculation Linkbase Document										X

Exhibit Number				Incorporated by Reference								Filed Herewith
Exhibit Description		Form		File No.		Exhibit		Filing Date
101.LAB		XBRL Taxonomy Labels Linkbase Document										X
101.PRE		XBRL Taxonomy Presentation Linkbase Document										X
101.DEF		XBRL Taxonomy Definition Linkbase Document										X

*	Indicates a management contract, compensatory plan or arrangement.
**	Filed by LifeLock, Inc.
§	The exhibits and schedules to this agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The Registrant agrees to furnish supplementally copies of any such exhibits and schedules to the SEC upon request.
†	Filed by Veritas Software Corporation.
††	This exhibit is being furnished, rather than filed, and shall not be deemed incorporated by reference into any filing, in accordance with Item 601 of Regulation S-K.