/FIRST ADD -- HKM002 -- Trend Micro Inc./

Share Name	Share Symbol	Market	Type
Trend Micro Incorporated ADS (MM)	NASDAQ:TMIC	NASDAQ	Common Stock

Trend Micro (NASDAQ:TMIC)
Historical Stock Chart

From May 2019 to May 2024

(3) CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME < As Originally Reported > (Thousands of yen) For the six For the six For the months months year Account ended ended ended June June December 30,2005 30,2006 31, 2005 Net income 8,490,156 7,996,972 18,669,954 Other comprehensive income (loss), before tax: Unrealized gains (losses) on available-for-sale securities: Unrealized holding gains (losses) arising during period (279,612) 465,352 1,375,136 Less reclassification adjustment for (gains) losses included in net income (186,353) (168,404) (704,199) (465,965) 296,948 670,937 Foreign currency translation adjustments 837,273 (28,049) 2,066,063 Total 371,308 268,899 2,737,000 Income tax (expense) benefit related to unrealized gains (losses) on available-for-sale securities 178,963 (127,725) (297,400) Other comprehensive income, net of tax 550,271 141,174 2,439,600 Comprehensive income 9,040,427 8,138,146 21,109,554 < As Amended > (Thousands of yen) For the six For the six For the months months year Account ended ended ended June June December 30,2005 30,2006 31, 2005 Net income 8,490,156 8,384,889 18,669,954 Other comprehensive income (loss), before tax: Unrealized gains (losses) on available-for-sale securities: Unrealized holding gains (losses) arising during period (279,612) 465,352 1,375,136 Less reclassification adjustment for (gains) losses in net income (186,353) (168,404) (704,199) (465,965) 296,948 670,937 Foreign currency translation adjustments 837,273 (28,049) 2,066,063 Total 371,308 268,899 2,737,000 Income tax (expense) benefit related to unrealized gains (losses) 178,963 (127,725) (297,400) on available-for-sale securities Other comprehensive income, net of tax 550,271 141,174 2,439,600 Comprehensive income 9,040,427 8,526,063 21,109,554 (4) CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY < As Originally Reported > (Thousands of yen) For the six For the six For the months months year Account ended ended ended June June December 30,2005 30,2006 31, 2005 < Common stock > Balance at beginning of period 11,426,977 12,484,849 11,426,977 Exercise of stock purchase warrants and stock acquisition rights 376,224 809,295 1,057,872 Balance at end of period 11,803,201 13,294,144 12,484,849 < Additional paid-in capital > Balance at beginning of period 17,359,335 18,572,063 17,359,335 Tax benefit from exercise of non-qualified stock warrants 300,271 125,689 155,323 Tax expense derived from gain on elimination of stock purchase -- (59,091) -- warrants related to stock option plan Stock option compensation expense -- 2,481,126 -- Exercise of stock purchase warrants and stock acquisition rights 376,069 809,086 1,057,405 Balance at end of period 18,035,675 21,928,873 18,572,063 < Retained earnings > Balance at beginning of period 42,165,026 55,971,955 42,165,026 Net income 8,490,156 7,996,972 18,669,954 Stock issue costs, net of tax (1,829) (3,178) (3,519) Cash dividends (4,794,028)(7,509,068) (4,794,028) Loss on sales of treasury stock, net of tax (30,303) (32,019) (65,478) Balance at end of period 45,829,022 56,424,662 55,971,955 < Net unrealized gain (loss) on available-for-sale securities > Balance at beginning of period 284,348 657,885 284,348 Net change during the period (287,002) 169,223 373,537 Balance at end of period (2,654) 827,108 657,885 < Cumulative foreign currency translation adjustments > Balance at beginning of period (606,463) 1,459,600 (606,463) Aggregate foreign currency translation adjustments for the period 837,273 (28,049) 2,066,063 Balance at end of period 230,810 1,431,551 1,459,600 < Treasury stock, at cost > Balance at beginning of period (7,454,463)(7,283,242) (7,454,463) Purchases of treasury stock (42,631) (305,817) (142,062) Sales of treasury stock 149,968 147,692 313,283 Balance at end of period (7,347,126)(7,441,367) (7,283,242) Total shareholders' equity 68,548,928 86,464,971 81,863,110 < As Amended > (Thousands of yen) For the six For the year For the six months ended Account months ended ended December 31, June 30,2005 June 2005 30,2006 < Common stock > Balance at beginning of period 11,426,977 12,484,849 11,426,977 Exercise of stock purchase warrants and stock acquisition rights 376,224 809,295 1,057,872 Balance at end of period 11,803,201 13,294,144 12,484,849 < Additional paid-in capital > Balance at beginning of period 17,359,335 18,572,063 17,359,335 Tax benefit from exercise of non-qualified stock warrants 300,271 125,689 155,323 Tax expense derived from gain on elimination of stock purchase warrants related to stock option plan -- (59,091) -- Stock option compensation expense -- 2,481,126 -- Exercise of stock purchase warrants and stock acquisition 376,069 809,086 1,057,405 rights Balance at end of period 18,035,675 21,928,873 18,572,063 < Retained earnings > Balance at beginning of period (as previously reported) 42,165,026 55,971,955 42,165,026 Cumulative-effect of correcting prior-period errors by applying SAB No.108 -- (2,251,639) -- Balance at beginning of period (as corrected) 42,165,026 53,720,316 42,165,026 Net income 8,490,156 8,384,889 18,669,954 Stock issue costs, net of tax (1,829) (3,178) (3,519) Cash dividends (4,794,028)(7,509,068) (4,794,028) Loss on sales of treasury stock, net of tax (30,303) (32,019) (65,478) Balance at end of period 45,829,022 54,560,940 55,971,955 < Net unrealized gain (loss) on available-for-sale securities > Balance at beginning of period 284,348 657,885 284,348 Net change during the period (287,002) 169,223 373,537 Balance at end of period (2,654) 827,108 657,885 < Cumulative foreign currency translation adjustments > Balance at beginning of period (606,463) 1,459,600 (606,463) Aggregate foreign currency translation adjustments for the period 837,273 (28,049) 2,066,063 Balance at end of period 230,810 1,431,551 1,459,600 < Treasury stock, at cost > Balance at beginning of period (7,454,463)(7,283,242) (7,454,463) Purchases of treasury stock (42,631) (305,817) (142,062) Sales of treasury stock 149,968 147,692 313,283 Balance at end of period (7,347,126)(7,441,367) (7,283,242) Total shareholders' equity 68,548,928 84,601,249 81,863,110 (5) CONSOLIDATED STATEMENT OF CASHFLOWS < As Originally Reported > (Thousands of yen) For the For the For the six six year Account months months ended ended ended December June June 31, 30,2005 30,2006 2005 Cash flows from operating activities: Net income 8,490,156 7,996,972 18,669,954 Adjustments to reconcile net income to net cash provided by operating activities - Depreciation and amortization 942,777 1,551,957 1,878,050 Pension and severance costs, less payments 91,650 45,400 207,109 Deferred income taxes 158,283 (2,119,648)(1,358,568) (Gain) loss on sales of marketable securities (20,534) (73,829)(370,326) Equity in earnings of affiliated companies (31,663) (10,942) (66,551) (Gain) loss on sale and disposal of fixed assets -- 3,362 11,585 Stock option compensation expense -- 2,478,850 -- Dividends received from affiliate company -- 28,000 -- Minority interest 420 574 338 Changes in assets and liabilities: Increase (decrease) in deferred revenue 1,424,155 4,174,075 6,209,680 (Increase) decrease in accounts receivable, net of allowances 1,552,014 3,505,934(3,567,924) (Increase) decrease in inventories (53,076) (137,610) (124,971) Increase (decrease) in notes and accounts payable, trade (510,190) 33,513 (526,321) Increase (decrease) in accrued income and other taxes (3,219,572) 3,221,541(1,826,959) (Increase) decrease in other current assets 133,075 (75,518) (34,426) Increase (decrease) in accounts payable, other 250,129 143,381 381,414 Increase (decrease) in other current liabilities 321,916 98,858 1,336,703 (Increase) decrease in other assets 5,754 (599,325) (207,984) Other 113,694 (287,900) 34,809 Net cash provided by operating activities 9,648,988 19,977,645 20,645,612 Cash flows from investing activities: Payments for purchases of property and equipment, net (507,160) (883,241)(1,153,193) Software development cost (475,129) (598,687)(1,446,248) Payments for purchases of other intangibles (83,946) (677,992) (216,107) Proceeds from sales and maturities of 8,545,586 8,974,014 22,079,575 marketable securities (Payments for) proceeds from marketable securities maturing within three months, net 784,865 426,035 (189,708) Payments for purchases of marketable securities and investment securities (8,241,925)(10,730,312)(28,043,534) Payments for acquisition of business (2,716,702) -- (2,716,702) (Payments for) proceeds from time deposits, net (523,121) 396,422 (1,052,017) Net cash used in investing activities (3,217,532) (3,093,761)(12,737,934) (Thousands of yen) For the For the For the six six year Account months months ended ended ended December June June 31, 30,2005 30,2006 2005 Cash flows from financing activities: Issuance of common stock pursuant to exercise of stock purchase warrants and stock acquisition rights 750,464 1,615,203 2,111,758 Proceeds from sales of treasury stock 119,665 115,672 247,805 Payments for purchase of treasury stock (42,631) (305,816) (142,062) Tax benefit from exercise of non-qualified stock warrants 300,271 125,689 155,322 Tax expense derived from gain on elimination stock purchase warrants related to stock option plan -- (59,091) -- Capital contributions from minority shareholders 4,193 -- 4,193 Dividends paid (4,766,610) (7,489,966) (4,782,764) Net cash used in financing activities (3,634,648) (5,998,309) (2,405,748) Effect of exchange rate changes on cash and cash equivalents 92,689 620,204 1,202,290 Net increase in cash and cash equivalents 2,889,497 11,505,779 6,704,220 Cash and cash equivalents at beginning of period 52,908,357 59,612,577 52,908,357 Cash and cash equivalents at end of period 55,797,854 71,118,356 59,612,577 Supplementary information of cash flows: Payments for interest 2,241 7,995 3,709 Payments for income taxes 7,350,227 3,603,882 13,109,985 < As Amended > (Thousands of yen) For the For the For the six six year Account months months ended ended ended December June June 31, 30,2005 30,2006 2005 Cash flows from operating activities: Net income 8,490,156 8,384,889 18,669,954 Adjustments to reconcile net income to net cash provided by operating activities - Depreciation and amortization 942,777 1,633,532 1,878,050 Pension and severance costs, less payments 91,650 45,400 207,109 Deferred income taxes 158,283 (1,965,640) (1,358,568) (Gain) loss on sales of marketable securities (20,534) (73,829) (370,326) Equity in earnings of affiliated companies (31,663) (10,942) (66,551) (Gain) loss on sale and disposal of fixed assets -- 3,362 11,585 Stock option compensation expense -- 2,478,850 -- Dividends received from affiliate company -- 28,000 -- Minority interest 420 574 338 Changes in assets and liabilities: Increase (decrease) in deferred revenue 1,424,155 3,621,987 6,209,680 (Increase) decrease in accounts receivable, net of allowances 1,552,014 3,505,934 (3,567,924) (Increase) decrease in inventories (53,076) (137,610) (124,971) Increase (decrease) in notes and accounts payable, trade (510,190) 33,513 (526,321) Increase (decrease) in accrued income and other taxes (3,219,572) 3,221,541 (1,826,959) (Increase) decrease in other current assets 133,075 (75,518) (34,426) Increase (decrease) in accounts payable, other 250,129 143,381 381,414 Increase (decrease) in other current liabilities 321,916 98,858 1,336,703 (Increase) decrease in other assets 5,754 (599,325) (207,984) Other 113,694 (285,339) 34,809 Net cash provided by operating activities 9,648,988 20,051,618 20,645,612 Cash flows from investing activities: Payments for purchases of property and equipment, net (507,160) (957,214) (1,153,193) Software development cost (475,129) (598,687) (1,446,248) Payments for purchases of other intangibles (83,946) (677,992) (216,107) Proceeds from sales and maturities of marketable securities 8,545,586 8,974,014 22,079,575 (Payments for) proceeds from marketable securities maturing within three months, net 784,865 426,035 (189,708) Payments for purchases of marketable securities and securities (8,241,925)(10,730,312)(28,043,534) Payments for acquisition of business (2,716,702) -- (2,716,702) (Payments for) proceeds from time deposits, net (523,121) 396,422 (1,052,017) Net cash used in investing activities (3,217,532) (3,167,734)(12,737,934) (Thousands of yen) For the For the For the six six year Account months months ended ended ended December June June 31, 30,2005 30,2006 2005 Cash flows from financing activities: Issuance of common stock pursuant to exercise of stock purchase warrants and stock acquisition rights 750,464 1,615,203 2,111,758 Proceeds from sales of treasury stock 119,665 115,672 247,805 Payments for purchase of treasury stock (42,631) (305,816) (142,062) Tax benefit from exercise of non-qualified stock warrants 300,271 125,689 155,322 Tax expense derived from gain on elimination stock purchase warrants related to stock option plan -- (59,091) -- Capital contributions from minority shareholders 4,193 -- 4,193 Dividends paid (4,766,610)(7,489,966)(4,782,764) (3,634,648)(5,998,309)(2,405,748) Net cash used in financing activities Effect of exchange rate changes on cash and cash equivalents 92,689 620,204 1,202,290 Net increase in cash and cash equivalents 2,889,497 11,505,779 6,704,220 Cash and cash equivalents at beginning of period 52,908,357 59,612,577 52,908,357 Cash and cash equivalents at end of period 55,797,854 71,118,356 59,612,577 Supplementary information of cash flows: Payments for interest 2,241 7,995 3,709 Payments for income taxes 7,350,227 3,603,882 13,109,985 NOTES TO INTERIM CONSOLIDATED FINANCIAL INFORMATION 2. Summary of significant accounting policies (Following accounting policies are newly added) < As Amended > Asset retirement obligations The Company accounts for its asset retirement obligations in accordance with SFAS No.143 'Accounting for Asset Retirement Obligation' and FASB Interpretation No.47 'Accounting for Conditional Asset Retirement Obligation - an interpretation of FASB Statement No.143,' which require that a company to recognize the fair value of a legal obligation associated with the retirement of long-lived assets as a liability in the period in which it is incurred and period-to-period changes in the asset retirement liability resulting from the passage of time and revisions to either the timing or the amount of the original estimate of undiscounted cash flows in the subsequent periods. The associated asset retirement costs are capitalized and amortized to expense over an economic useful life of the related assets. Quantifying financial statement misstatements In September 2006, the Securities and Exchange Commission issued Staff Accounting Bulletin ('SAB') No.108, 'Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements.' SAB No. 108 requires the Company to quantify misstatements using both the balance-sheet and income-statement approach and to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative and qualitative factors. When the effect of initial adoption is determined to be material, SAB No. 108 allows the Company to record that effect as a transitional cumulative-effect adjustment to beginning-of-year retained earnings. SAB No. 108 is effective from the first annual period ending after November 16, 2006, however, as permitted, the Company has elected to adopt the provisions early from the first half period of this fiscal year. Upon adoption of SAB No. 108, the Company corrected prior year misstatements through a cumulative-effect adjustment to the beginning of the year retained earnings in the amount of (Yen) 2,251,639 thousand, which had previously been considered immaterial to the prior year consolidated financial statements. A breakdown of the cumulative-effect adjustment is as follows: (Thousands of Yen) Fiscal year Increase Contents and reasons of the that (decrease) in the misstatements misstatements beginning of year occurred retained earnings (1)Post-contract customer support service revenue should be deferred and recognized ratably over the service period. The Company corrected certain inconsistencies between the revenue recognition period and the actual service period that had occurred due to an operational limitation of tracking individual customer contract terms. FY 1999 - (1,189,469) (2)In Japan, revenue for certain multi-year support service contracts was being recognized in a one-year period due to a system bug. FY 1999 - (12,288) (3)Revenue of our North America operation had been dominated by the sales for the large corporate market and the deferral method used for sales in the large corporate market was also applied to the sales in the consumer market. However, the sales in the North America consumer market have increased in recent years. Therefore, the Company changed its deferral method in the consumer market to reflect a more accurate fair value. FY 1999 - (143,845) (4)The fair value of post-contract customer support service in the Japanese consumer market had been determined in reference to the retail list price (the price for end-users) of each product component. To calculate more accurate fair value, the Company changed its deferral amounts to the ones which were based on the wholesale price (the price for distributors). FY 1999 - (725,585) (5)The fair value of the legal obligation associated with the retirement of long-lived assets should be recognized as a liability as prescribed in SFAS No.143. However, the Company had not recorded certain such obligations that were considered immaterial. Therefore, the Company had provided an appropriate amount for all of its asset retirement obligations. FY 2005 - (84,019) (6)In our North America operation, a subsidiary had applied the same deferral method for the major product line to the revenue from Intermute products and the products with a seat number of 50,001 or more, as well as the products bundled with a premium support program. However, the Company changed its method so that the entire sales amounts are deferred and recognized ratably over the service period since the fair value of the PCS component for those products could not be determined. FY 2005 - (253,742) (7)In our North America operation, the start date and end date information for certain post-contract customer service arrangements was incorrectly entered into the system due to human processing errors. Accordingly, the Company corrected amortization of the related deferred revenue. FY 2005 23,212 (8)In our North America operation, a subsidiary corrected its tax calculation with regard to the transfer of intellectual property which took place in 2005. FY 2005 284,830 (9)In our North America operation, a subsidiary immediately expensed certain fixed assets with an acquisition cost of less than USD 3,000 or a useful life of less than 2 years. The Company has capitalized such fixed assets and recorded appropriate depreciation expense. FY 2003 - 133,594 (10)In our European operation, the Company corrected certain inconsistencies between the revenue recognition period and the actual service period. FY 1999 - (284,327) Total (2,251,639) 3. Reconciliation of the difference between basic and diluted net income per share ('EPS') < As Originally Reported > A reconciliation of the differences between basic and diluted EPS for the six months ended June 30, 2005 and 2006 and for the year ended December 31, 2005, is as follows: For the six For the six For the year months ended months ended ended June 30, 2005 June 30, 2006 December 31, 2005 Thousands of Yen Net income available to common shareholders 8,490,156 7,996,972 18,669,954 Thousands of Shares Weighted-average number of common shares 133,341 134,323 133,498 Effect of dilutive securities: Stock options 2,045 621 1,958 Weighted-average number of common shares for diluted EPS computation 135,386 134,944 135,456 Yen Basic EPS: 63.67 59.54 139.85 Diluted EPS: 62.71 59.26 137.83 Shareholders' equity per share as of June 30, 2005 and 2006 and December 31, 2005, was as follows: (Yen) June 30, June 30, December 31, 2005 2006 2005 Shareholders' equity per share 513.45 642.18 610.51 < As Amended > A reconciliation of the differences between basic and diluted EPS for the six months ended June 30, 2005 and 2006 and for the year ended December 31, 2005, is as follows: For the six For the six For the year months ended months ended ended June 30, 2005 June 30, 2006 December 31, 2005 Thousands of Yen Net income available to common shareholders 8,490,156 8,384,889 18,669,954 Thousands of Shares Weighted-average number of common shares 133,341 134,323 133,498 Effect of dilutive securities: Stock options 2,045 621 1,958 Weighted-average number of common shares for EPS computation 135,386 134,944 135,456 Yen Basic EPS: 63.67 62.42 139.85 Diluted EPS: 62.71 62.14 137.83 Shareholders' equity per share as of June 30, 2005 and 2006 and December 31, 2005, was as follows: (Yen) June 30, June 30, December 31, 2005 2006 2005 Shareholders' equity per share 513.45 628.34 610.51 11. Asset retirement obligation (Following footnote below is newly added after 'Employee benefit plans' ) < As Amended > The Company has legal obligations associated with the retirement of long- lived assets in connection with restoration activities to be carried out at the time the Company vacates certain leased premises, and records such legal obligation as the asset retirement obligations included in other non-current liabilities. Information regarding the activities for the asset retirement obligation for the six months ended June 30, 2006 is as follows: (Thousands of Yen) For the six months ended June 30, 2006 Beginning balance (as adjusted) 200,161 Accretion expense 2,562 Newly incurred in the period 15,960 Ending balance 218,683 < As Originally Reported > 13. Segment information ��SNIP�� (Thousands of yen) For the six For the six For the year Net sales to external months months ended customers ended ended December 31, June 30, 2005 June 30, 2006 2005 Japan 14,247,671 16,072,588 29,416,077 North America 6,884,623 8,835,759 15,416,991 Europe 8,828,580 10,021,048 18,379,304 Asia Pacific 3,765,821 4,435,824 7,909,753 Latin America 763,045 1,308,208 1,907,776 Corporate -- -- -- Consolidated Total 34,489,740 40,673,427 73,029,901 (Thousands of yen) For the six For the six For the year Operating income months months ended ended ended December 31, June 30, 2005 June 30, 2006 2005 Japan 9,005,153 13,258,245 18,636,462 North America 4,587,286 4,660,912 10,483,801 Europe 4,899,005 4,503,754 10,330,980 Asia Pacific 1,516,628 596,537 2,836,044 Latin America 319,536 808,327 1,092,793 Corporate (7,556,468) (10,110,414) (15,808,305) Consolidated Total 12,771,140 13,717,361 27,571,775 From the fiscal year ending December 31, 2006, the Company reports sales information by customer size in addition to the sales information by five regional segments for the chief operating decision maker to assess the Company's performance. The three operating segment by customer size are enterprise, small and mid size business, and consumer. Below is summarized segment information of sales by customer size. These figures comply with the accounting policies disclosed in the notes to consolidated financial statements. (Thousands of yen) For the six months Net sales to external customers ended June 30, 2006 Enterprise 11,140,592 Small and mid size business 19,543,364 Consumer 9,989,471 Consolidated Total 40,673,427 Significant customer (Thousands of yen) For the six months For the six months For the year ended ended ended Customer June 30, 2005 June 30, 2006 December 31, 2005 Net sales Ratio Net sales Ratio Net sales Ratio SOFTBANK BB 5,145,269 14.9% 5,878,167 14.5% 10,604,947 14.5% < As Amended > 14. Segment information ��SNIP�� (Thousands of yen) For the six For the six For the year Net sales to external months months ended customers ended ended December 31, June 30, 2005 June 30, 2006 2005 Japan 14,247,671 16,155,904 29,416,077 North America 6,884,623 9,068,187 15,416,991 Europe 8,828,580 10,257,392 18,379,304 Asia Pacific 3,765,821 4,435,824 7,909,753 Latin America 763,045 1,308,208 1,907,776 Corporate - -- -- Consolidated Total 34,489,740 41,225,515 73,029,901 (Thousands of yen) For the six For the six For the year Operating income months months ended ended ended December 31, June 30, 2005 June 30, 2006 2005 Japan 9,005,153 13,333,738 18,636,462 North America 4,587,286 4,898,296 10,483,801 Europe 4,899,005 4,738,533 10,330,980 Asia Pacific 1,516,628 590,806 2,836,044 Latin America 319,536 808,327 1,092,793 Corporate (7,556,468) (10,110,414) (15,808,305) Consolidated Total 12,771,140 14,259,286 27,571,775 From the fiscal year ending December 31, 2006, the Company reports sales information by customer size in addition to the sales information by five regional segments for the chief operating decision maker to assess the Company's performance. The three operating segment by customer size are enterprise, small and mid size business, and consumer. Below is summarized segment information of sales by customer size. These figures comply with the accounting policies disclosed in the notes to consolidated financial statements. (Thousands of yen) For the six months Net sales to external customers ended June 30, 2006 Enterprise 11,176,958 Small and mid size business 19,614,539 Consumer 10,434,018 Consolidated Total 41,225,515 Significant customer (Thousands of yen) For the six months For the six months For the year ended ended ended Customer June 30, 2005 June 30, 2006 December 31, 2005 Net sales Ratio Net sales Ratio Net sales Ratio SOFTBANK BB 5,145,269 14.9% 5,909,763 14.3% 10,604,947 14.5% < As Originally Reported > 14. Deferred revenue by region (Thousands of yen ) As of June 30, 2005 As of June 30, 2006 As of December 31, 2005 Current Non-current Current Non-current Current Non-current Japan 11,163,970 1,450,931 14,237,796 1,441,820 12,429,867 1,542,109 North America 5,815,242 723,391 8,050,075 2,004,911 7,529,743 856,903 Europe 6,352,090 1,109,933 8,210,938 1,402,109 7,779,059 1,289,305 Asia Pacific 2,115,572 140,846 2,630,861 432,408 2,579,002 186,619 Latin America 793,645 -- 1,295,430 -- 1,188,644 -- Total 26,240,519 3,425,101 34,425,100 5,281,248 31,506,315 3,874,936 < As Amended > 15. Deferred revenue by region (Thousands of yen ) As of June 30, 2005 As of June 30, 2006 As of December 31, 2005 Current Non-current Current Non-current Current Non-current Japan 11,163,970 1,450,931 16,887,664 1,724,440 12,429,867 1,542,109 North America 5,815,242 723,391 8,521,399 2,011,773 7,529,743 856,903 Europe 6,352,090 1,109,933 8,387,598 1,412,691 7,779,059 1,289,305 Asia Pacific 2,115,572 140,846 2,630,861 432,408 2,579,002 186,619 Latin America 793,645 -- 1,295,430 -- 1,188,644 -- Total 26,240,519 3,425,101 37,722,952 5,581,312 31,506,315 3,874,936 < As Originally Reported > 15. Subsequent events (1) Trend Micro adopted, at the meeting of the Board of Directors on June 30, 2006, the following resolutions regarding stock acquisition rights to be issued to the directors, employees and staff seconded to, of the Company and its affiliates in order to introduce the 17th stock option plan. Date of issuance July 10, 2006 Number of stock acquisition The total number of stock acquisition rights to be issued rights is 2,902. (One stock acquisition right represents the acquisition right of five hundred shares.) Class of shares subject to Common shares for the Company the exercise of stock acquisition rights Issue price of stock acquisition (Yen) 0 rights Exercise period of stock The exercise period of stock acquisition acquisition rights rights shall be from July 10, 2007 to July 9, 2011. Exercise price per share (Yen)3,995 Individuals who were be granted The directors and employees of and staff the stock acquisition seconded to the Company rights: and its affiliates (1,372 people) (2) Trend Micro adopted, at the meeting of the Board of Directors on August 21, 2006, the following share repurchase program in order to gain flexibility in implementing its capital policy in response to any changes in the business environment: (+1) Resolution Class of capital stock to be Common Shares of the Company purchased Number of shares to be Up to 2 million shares (1.49% of the repurchased total outstanding shares) Total purchase price Up to 7 billion yen Purchase period From August 22, 2006 to September 30, 2006 Purchase method Transactions through the Tokyo Stock Exchange (+2) Others As a result of the transactions through a stock market, the Company repurchased 2,000,000 shares of its common stock for a total cost of (Yen) 6,809,730 thousand and completed the share repurchase program on September 20, 2006. < As Amended > 16. Subsequent events (1) Trend Micro adopted, at the meeting of the Board of Directors on June 30, 2006, the following resolutions regarding stock acquisition rights to be issued to the directors, employees and staff seconded to, of the Company and its affiliates in order to introduce the 17th stock option plan. Date of issuance July 10, 2006 Number of stock acquisition The total number of stock acquisition rights to be issued rights is 2,902. (One stock acquisition right represents the acquisition right of five hundred shares.) Class of shares subject to Common shares for the Company the exercise of stock acquisition rights Issue price of stock acquisition (Yen) 0 rights Exercise period of stock The exercise period of stock acquisition acquisition rights rights shall be from July 10, 2007 to July 9, 2011. Exercise price per share (Yen)3,995 Individuals who were be granted The directors and employees of and staff the stock acquisition seconded to the Company rights: and its affiliates (1,372 people) (2) Trend Micro adopted, at the meeting of the Board of Directors on August 21, 2006, the following share repurchase program in order to gain flexibility in implementing its capital policy in response to any changes in the business environment: (+1) Resolution Class of capital stock to be Common Shares of the Company purchased Number of shares to be Up to 2 million shares (1.49% of the repurchased total outstanding shares) Total purchase price Up to 7 billion yen Purchase period From August 22, 2006 to September 30, 2006 Purchase method Transactions through the Tokyo Stock Exchange (+2) Others As a result of the transactions through a stock market, the Company repurchased 2,000,000 shares of its common stock for a total cost of (Yen) 6,809,730 thousand and completed the share repurchase program on September 20, 2006. (3) Trend Micro adopted, at the meeting of the Board of Directors on October 31, 2006, the following resolutions regarding stock acquisition rights to be issued to the directors, employees and staff seconded to, of the Company and its affiliates in order to introduce the 18th stock option plan. Date of issuance November 8, 2006 Number of stock acquisition The total number of stock acquisition rights to be issued rights is 2,906. (One stock acquisition right represents the acquisition right of five hundred shares.) Class of shares subject to Common shares for the Company the exercise of stock acquisition rights Issue price of stock acquisition (Yen) 0 rights Exercise period of stock The exercise period of stock acquisition acquisition rights rights shall be from November 8, 2007 to November 7, 2011. Exercise price per share (Yen)3,610 Individuals who were be granted The directors and employees of and staff the stock acquisition seconded to the Company rights: and its affiliates (1,173 people) < As Originally Reported > 16. Status of manufacturing and actual sales (2) Sales results (Thousands of Yen) For the six For the six For the year Period months months ended ended ended December 31,2005 Product June 30,2005 June 30,2006 PC client 9,503,106 11,141,074 19,714,453 LAN server 1,571,812 1,407,760 3,278,568 Internet server 8,809,325 9,105,326 18,373,789 All Suite products 11,479,519 15,045,681 24,484,969 Other products 1,545,459 1,803,183 3,494,862 Sub-total 32,909,221 38,503,024 69,346,641 Other service 1,580,519 2,170,403 3,683,260 Total 34,489,740 40,673,427 73,029,901 < As Amended > 17. Status of manufacturing and actual sales (2) Sales results (Thousands of Yen) For the six For the six For the year Period months months ended ended ended December 31,2005 Product June 30,2005 June 30,2006 PC client 9,503,106 11,469,141 19,714,453 LAN server 1,571,812 1,405,604 3,278,568 Internet server 8,809,325 9,153,598 18,373,789 All Suite products 11,479,519 15,204,927 24,484,969 Other products 1,545,459 1,817,106 3,494,862 Sub-total 32,909,221 39,050,376 69,346,641 Other service 1,580,519 2,175,139 3,683,260 Total 34,489,740 41,225,515 73,029,901 A part of report of First-Half Results (Non-consolidated) For Fiscal Year Ending December 31, 2006 < Original > 1. Financial Highlights for the first half of FY 2006 (January 1, 2006 through June 30, 2006) (1) Results of operations (All figures except for per share information are rounded down to millions of yen) Growth Operating Growth Ordinary Growth Net sales rate income rate income rate Millions of % Millions % Millions % yen of yen of yen The first half of FY 2006 26,438 17.9 11,917 15.0 12,315 18.6 The first half of FY 2005 22,421 21.8 10,359 15.4 10,383 17.4 FY 2005 (annual) 48,228 21,823 22,423 Net Net income Growth rate income per share Millions % Yen of yen The first half of FY 2006 8,740 48.5 65.07 The first half of FY 2005 5,884 5.9 44.13 FY 2005 (annual) 13,122 98.30 (Note) 1. Weighted average number of shares 134,323,039 shares (for the first outstanding: half of FY 2006) 133,341,012 shares (for the first half of FY 2005) 133,498,438 shares (for FY 2005) 2. Change in accounting policies: None 3. The percentage of net sales, operating income, ordinary income and net income are comparison to the first half of previous fiscal year. (2) Financial Position Shareholders' Shareholders' Shareholders' Total assets equity equity ratio equity per share As of Millions of yen Millions of yen % Yen June 30, 2006 91,238 61,482 67.4 456.64 June 30, 2005 70,949 49,188 69.3 368.44 December 31, 2005 83,692 58,515 69.9 436.39 (Note) 1. Number of shares issued at the 134,642,555 shares as of June 30, 2006 end of period: 136,051,155 shares as of June 30, 2005 134,090,494 shares as of December 31, 2005 2. Number of treasury stocks at 2,536,949 shares as of June 30,2006 the end of period: 2,545,688 shares as of June 30,2005 2,513,231 shares as of December 31, 2005 < Amended > 1. Financial Highlights for the first half of FY 2006 (January 1, 2006 through June 30, 2006) (1) Results of operations (All figures except for per share information are rounded down to millions of yen) Growth Operating Growth Ordinary Growth Net sales rate income rate income rate Millions of % Millions % Millions % yen of yen of yen The first half of FY 2006 26,522 18.3 12,000 15.8 12,398 19.4 The first half of FY 2005 22,421 21.8 10,359 15.4 10,383 17.4 FY 2005 (annual) 48,228 21,823 22,423 Net Net income Growth rate income per share Millions % Yen of yen The first half of FY 2006 7,000 19.0 52.12 The first half of FY 2005 5,884 5.9 44.13 FY 2005 (annual) 13,122 98.30 (Note) 1. Weighted average number of shares 134,323,039 shares (for the first outstanding: half of FY 2006) 133,341,012 shares (for the first half of FY 2005) 133,498,438 shares (for FY 2005) 2. Change in accounting policies: None 3. The percentage of net sales, operating income, ordinary income and net income are comparison to the first half of previous fiscal year (2) Financial Position Shareholders' Shareholders' Shareholders' Total assets equity equity ratio equity per share As of Millions of yen Millions of yen % Yen June 30, 2006 92,431 59,743 64.6 443.72 June 30, 2005 70,949 49,188 69.3 368.44 December 31, 2005 83,692 58,515 69.9 436.39 (Note) 1. Number of shares issued at the 134,642,555 shares as of June 30, 2006 end of period: 136,051,155 shares as of June 30, 2005 134,090,494 shares as of December 31, 2005 2. Number of treasury stocks at 2,536,949 shares as of June 30,2006 the end of period: 2,545,688 shares as of June 30,2005 2,513,231 shares as of December 31, 2005 DATASOURCE: Trend Micro Inc.

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TMIC Trend Micro Incorporated ADS (MM)