[December 08, 2016] |
|
Dell Technologies Reports Fiscal Year 2017 Third Quarter Financial Results
Dell Technologies (NYSE: DVMT):
News summary:
-
Third quarter revenue was $16.2 billion, non-GAAP revenue was $16.8
billion
-
Operating loss of $1.5 billion, non-GAAP operating income of $2 billion
-
$5.8 billion of debt paid down to date following the EMC merger close
-
Combined company hit the ground running, shipped first integrated
product just 27 days after transaction close
Full story:
Dell Technologies (NYSE: DVMT) announced its fiscal 2017 third quarter
results, which reflect the impact of the EMC merger and include 52 days
of financial results from EMC and VMware. Consolidated revenue from
continuing operations was $16.2 billion and non-GAAP revenue from
continuing operations was $16.8 billion. The company generated an
operating loss of $1.5 billion in the quarter, with a non-GAAP operating
income of $2 billion.
"Overall we had a solid quarter with revenue of $16.2 billion, or $16.8
billion on a non-GAAP basis," said Tom Sweet, chief financial officer,
Dell Technologies Inc. "We remain intensely focused on enabling
customers' digital transformation initiatives. This customer-first focus
is also driving our near-term priorities, which include successfully
integrating our salesforce and channel partner programs and seizing
top-line synergies through cross-selling opportunities."
The company ended the quarter with a cash and investments balance of $15
billion. During the quarter, Dell Technologies paid down $500 million of
debt and repurchased $165 million of Class V Common Stock under the
repurchase program it announced Sept. 7. Since the completion of the EMC
transaction, Dell Technologies has reduced total debt by $5.8 billion
and repurchased $324 million of Class V Common Stock under its
repurchase program.
Fiscal year 2017 third quarter results:
|
|
|
Three Months Ended
|
|
|
Nine Months Ended
|
|
|
|
October 28, 2016
|
|
|
October 30, 2015
|
|
|
Change
|
|
|
October 28, 2016
|
|
|
October 30, 2015
|
|
|
Change
|
|
|
|
(in millions, except percentages; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
|
|
$
|
16,247
|
|
|
|
$
|
12,674
|
|
|
|
28
|
%
|
|
|
$
|
41,568
|
|
|
|
$
|
38,232
|
|
|
|
9
|
%
|
Operating loss
|
|
|
$
|
(1,512
|
)
|
|
|
$
|
(78
|
)
|
|
|
NM
|
|
|
|
$
|
(1,584
|
)
|
|
|
$
|
(488
|
)
|
|
|
(225
|
%)
|
Net loss from continuing operations
|
|
|
$
|
(1,637
|
)
|
|
|
$
|
(264
|
)
|
|
|
(520
|
%)
|
|
|
$
|
(2,323
|
)
|
|
|
$
|
(1,000
|
)
|
|
|
(132
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP net revenue
|
|
|
$
|
16,777
|
|
|
|
$
|
12,781
|
|
|
|
31
|
%
|
|
|
$
|
42,241
|
|
|
|
$
|
38,602
|
|
|
|
9
|
%
|
Non-GAAP operating income
|
|
|
$
|
1,975
|
|
|
|
$
|
607
|
|
|
|
225
|
%
|
|
|
$
|
3,270
|
|
|
|
$
|
1,570
|
|
|
|
108
|
%
|
Non-GAAP net income from continuing operations
|
|
|
$
|
970
|
|
|
|
$
|
294
|
|
|
|
230
|
%
|
|
|
$
|
1,596
|
|
|
|
$
|
671
|
|
|
|
138
|
%
|
Adjusted EBITDA
|
|
|
$
|
2,230
|
|
|
|
$
|
711
|
|
|
|
214
|
%
|
|
|
$
|
3,757
|
|
|
|
$
|
1,880
|
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The consolidated results of Dell Technologies include 52 days of EMC
and VMware's results, from Sept. 7, 2016, the close of the EMC merger,
through Oct. 28, 2016, the end of Dell Technologies' fiscal 2017 third
quarter.
Information about Dell Technologies' use of non-GAAP financial
information is provided under "Non-GAAP Financial Measures" below. All
comparisons in this press release are year-over-year unless otherwise
noted.
Operating segments summary:
Client Solutions Group outgrew the industry1 in both
Consumer and Commercial with business revenue for the quarter at $9.2
billion, up 3 percent versus the third quarter of last year. Operating
income for the quarter was $634 million. Key takeaways from the quarter
include:
-
Fastest growth among top three vendors, with 15th
consecutive quarter of year-over-year PC unit growth and 160 basis
points of unit share gained1
-
No. 1 in workstations unit share worldwide2 (tied)
-
No. 1 share position worldwide for displays, gaining unit share
year-over-year for the 14th consecutive quarter3
Infrastructure Solutions Group performance was mixed in the
quarter, with revenue of approximately $6 billion and operating income
of $897 million. Key takeaways include:
-
Strong growth of the all-flash portfolio and Enterprise Hybrid Cloud
solutions
-
Strong performance of the hyper-converged infrastructure portfolio,
including triple-digit year-over-year revenue growth for XC
hyper-converged infrastructure products
-
Softness in standalone hybrid storage arrays and servers
VMware revenue during the 52-day operations period from the close
of the EMC merger (Sept. 7) to the end of Dell Technologies' fiscal
third quarter 2017 (Oct. 28) was $1.3 billion, with an operating income
of $548 million.
Also during the quarter, Dell Technologies held its first Dell EMC World
combined customer and partner conference, which saw record attendance
and the launch of 14 new products, including Dell EMC's VxRail and
VxRack hyper-converged infrastructure solutions using PowerEdge servers.
The company also shipped its first integrated solution - the ScaleIO
Ready Node - less than 30 days following the close of the EMC
transaction.
Conference call information
As previously announced, the company will hold a conference call to
discuss its third quarter performance Dec. 8, 2016, at 7 a.m. CST. The
conference call will be broadcast live over the internet and can be
accessed at investors.delltechnologies.com.
For those unable to listen to the live broadcast, an archived version
will be available at the same location.
A slide presentation containing additional financial and operating
information may be downloaded from Dell Technologies' website at investors.delltechnologies.com.
About Dell Technologies
Dell Technologies is a
unique family of businesses that provides the essential infrastructure
for organizations to build their digital future, transform IT and
protect their most important asset, information. The company services
customers of all sizes across 180 countries - ranging from 98 percent of
the Fortune 500 to individual consumers - with the industry's most
comprehensive and innovative portfolio from the edge to the core to the
cloud.
1 IDC Worldwide Quarterly PC Tracker, 2016Q3, Oct. 11, 2016,
and on a calendar-quarter basis. 2 IDC Worldwide
Quarterly Workstation Tracker, 2016Q3, Nov. 9, 2016, and on a
calendar-quarter basis. 3 IDC Worldwide Quarterly PC
Monitor Tracker - Final Historical, 2016Q3, Nov. 23, 2016, and on a
calendar-quarter basis.
Copyright © 2016 Dell Inc. or its subsidiaries. All Rights Reserved.
Dell, Dell Inc. and the Dell logo are trademarks of Dell Technologies in
the United States and/or other jurisdictions. All other marks and names
mentioned herein may be trademarks of their respective companies.
Non-GAAP Financial Measures
The press release presents information about the Company's non-GAAP
product net revenue, non-GAAP services net revenue, non-GAAP net
revenue, non-GAAP product gross margin, non-GAAP services gross margin,
non-GAAP gross margin, non-GAAP operating expenses, non-GAAP operating
income, non-GAAP net income from continuing operations, EBITDA and
adjusted EBITDA, which are non-GAAP financial measures provided as a
supplement to the results provided in accordance with generally accepted
accounting principles in the United States of America ("GAAP"). A
reconciliation of each of the foregoing historical non-GAAP financial
measures to the most directly comparable historical GAAP financial
measures is provided in the attached tables for each of the fiscal
periods indicated.
Special Note on Forward-Looking Statements:
Statements in this press release that relate to future results and
events are forward-looking statements within the meaning of Section 21E
of the Securities Exchange Act of 1934 and Section 27A of the Securities
Act of 1933 and are based on Dell Technologies' current expectations. In
some cases, you can identify these statements by such forward-looking
words as "anticipate," "believe," "confidence," "could," "estimate,"
"expect," "guidance," "intend," "may," "objective," "outlook," "plan,"
"project," "possible," "potential," "should," "will" and "would," or
similar words or expressions that refer to future events or outcomes.
Dell Technologies' results or events in future periods could differ
materially from those expressed or implied by these forward-looking
statements because of risks, uncertainties, and other factors that
include, but are not limited to, the following: competitive pressures;
Dell Technologies' reliance on third-party suppliers for products and
components, including reliance on single-source or limited-source
suppliers; Dell Technologies' ability to achieve favorable pricing from
its vendors; weak global economic conditions and instability in
financial markets; Dell Technologies' execution of its growth, business
and acquisition strategies; the success of Dell Technologies' cost
efficiency measures; Dell Technologies' ability to manage solutions and
products and services transitions in an effective manner; Dell
Technologies' ability to deliver high-quality products and services;
Dell Technologies' foreign operations and ability to generate
substantial non-U.S. net revenue; Dell Technologies' product, customer,
and geographic sales mix, and seasonal sales trends; the performance of
Dell Technologies' sales channel partners; access to the capital markets
by Dell Technologies or its customers; weak economic conditions and
additional regulation; counterparty default risks; the loss by Dell
Technologies of any services contracts with its customers, including
government contracts, and its ability to perform such contracts at its
estimated costs; Dell Technologies' ability to develop and protect its
proprietary intellectual property or obtain licenses to intellectual
property developed by others on commercially reasonable and competitive
terms; infrastructure disruptions, cyber-attacks, or other data security
breaches; Dell Technologies' ability to hedge effectively its exposure
to fluctuations in foreign currency exchange rates and interest rates;
expiration of tax holidays or favorable tax rate structures, or
unfavorable outcomes in tax audits and other tax compliance matters;
impairment of portfolio investments; unfavorable results of legal
proceedings; increased costs and additional regulations and requirements
as a result of Dell Technologies becoming a newly public company; Dell
Technologies' ability to develop and maintain effective internal control
over financial reporting; compliance requirements of changing
environmental and safety laws; the effect of armed hostilities,
terrorism, natural disasters, and public health issues; risks related to
EMC's business, including the impact of the financial performance of
VMware, EMC's strategic alliances, and the impact of market volatility
on the assets of EMC's noncontributory defined pension plan; the ability
to realize the anticipated synergies from the merger with EMC; the
ability to integrate EMC's technology, solutions, products, and services
with those of Dell in an effective manner; the outcome of lawsuits that
have been filed against Dell Technologies or EMC relating to the merger;
and Dell Technologies' level of indebtedness and its ability to achieve
its objective of reducing its indebtedness.
This list of risks, uncertainties, and other factors is not complete.
Dell Technologies discusses some of these matters more fully, as well as
certain risk factors that could affect the Dell Technologies' business,
financial condition, results of operations, and prospects, in its
filings with the Securities and Exchange Commission, including the
prospectus/proxy statement forming part of Dell Technologies'
Registration Statement on Form S-4 (Registration No. 333-208524) and
Dell Technologies' quarterly reports on Form 10-Q and current reports on
Form 8-K. These filings are available for review through the Securities
and Exchange Commission's website at www.sec.gov.
Any or all forward-looking statements Dell Technologies makes may turn
out to be wrong and can be affected by inaccurate assumptions Dell
Technologies might make or by known or unknown risks, uncertainties and
other factors, including those identified in this press release.
Accordingly, you should not place undue reliance on the forward-looking
statements made in this press release, which speak only as of its date.
Dell Technologies does not undertake to update, and expressly disclaims
any duty to update, its forward-looking statements, whether as a result
of circumstances or events that arise after the date they are made, new
information or otherwise.
Special Note on the Divestitures:
On March 27, 2016, Dell entered into a definitive agreement with NTT
Data International L.L.C. to sell substantially all of Dell Services for
cash consideration of approximately $3.1 billion. On June 19, 2016, Dell
entered into a definitive agreement with Francisco Partners and Elliot
Management Corporation to sell substantially all of Dell Software Group
for cash consideration of approximately $2.4 billion. On Sept. 12, 2016,
EMC Corporation entered into a definitive agreement with OpenText to
divest the Dell EMC Enterprise Content Division, or ECD, and its product
portfolio (including the Documentum, InfoArchive, and LEAP families of
products) for cash consideration of approximately $1.6 billion.
Accordingly, the results of operations of Dell Services, Dell Software
Group and ECD have been excluded from the results of continuing
operations and from segment results. On October 31, 2016, Dell completed
the sale of Dell Software Group. On November 2, 2016, Dell completed the
sale of Dell Services.
|
|
|
|
|
|
|
|
|
|
|
|
DELL TECHNOLOGIES INC.
|
Condensed Consolidated Statements of Income (Loss) and Related
Financial Highlights
|
(in millions, except per share amounts and percentages; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
% Growth
|
|
Nine Months Ended
|
|
% Growth
|
|
|
|
October 28,
|
|
October 30,
|
|
Rates
|
|
October 28,
|
|
October 30,
|
|
Rates
|
|
|
|
2016
|
|
2015
|
|
Yr. to Yr.
|
|
2016
|
|
2015
|
|
Yr. to Yr.
|
Net revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Products
|
|
|
$
|
12,366
|
|
|
$
|
10,638
|
|
|
16
|
%
|
|
$
|
33,510
|
|
|
$
|
32,100
|
|
|
4
|
%
|
Services
|
|
|
|
3,881
|
|
|
|
2,036
|
|
|
91
|
%
|
|
|
8,058
|
|
|
|
6,132
|
|
|
31
|
%
|
Total net revenue
|
|
|
|
16,247
|
|
|
|
12,674
|
|
|
28
|
%
|
|
|
41,568
|
|
|
|
38,232
|
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of net revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Products
|
|
|
|
10,562
|
|
|
|
9,328
|
|
|
13
|
%
|
|
|
28,856
|
|
|
|
28,355
|
|
|
2
|
%
|
Services
|
|
|
|
1,786
|
|
|
|
1,214
|
|
|
47
|
%
|
|
|
4,284
|
|
|
|
3,744
|
|
|
14
|
%
|
Total cost of net revenue
|
|
|
|
12,348
|
|
|
|
10,542
|
|
|
17
|
%
|
|
|
33,140
|
|
|
|
32,099
|
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
|
|
3,899
|
|
|
|
2,132
|
|
|
83
|
%
|
|
|
8,428
|
|
|
|
6,133
|
|
|
37
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling, general, and administrative
|
|
|
|
4,556
|
|
|
|
1,943
|
|
|
134
|
%
|
|
|
8,647
|
|
|
|
5,849
|
|
|
48
|
%
|
Research and development
|
|
|
|
855
|
|
|
|
267
|
|
|
220
|
%
|
|
|
1,365
|
|
|
|
772
|
|
|
77
|
%
|
Total operating expenses
|
|
|
|
5,411
|
|
|
|
2,210
|
|
|
145
|
%
|
|
|
10,012
|
|
|
|
6,621
|
|
|
51
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
|
(1,512
|
)
|
|
|
(78
|
)
|
|
|
|
|
(1,584
|
)
|
|
|
(488
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other, net
|
|
|
|
(794
|
)
|
|
|
(203
|
)
|
|
|
|
|
(1,362
|
)
|
|
|
(600
|
)
|
|
|
Loss from continuing operations before income taxes
|
|
|
|
(2,306
|
)
|
|
|
(281
|
)
|
|
|
|
|
(2,946
|
)
|
|
|
(1,088
|
)
|
|
|
Income tax benefit
|
|
|
|
(669
|
)
|
|
|
(17
|
)
|
|
|
|
|
(623
|
)
|
|
|
(88
|
)
|
|
|
Net loss from continuing operations
|
|
|
|
(1,637
|
)
|
|
|
(264
|
)
|
|
|
|
|
(2,323
|
)
|
|
|
(1,000
|
)
|
|
|
Income (loss) from discontinued operations, net of income taxes
|
|
|
|
(438
|
)
|
|
|
84
|
|
|
|
|
|
875
|
|
|
|
51
|
|
|
|
Net loss
|
|
|
|
(2,075
|
)
|
|
|
(180
|
)
|
|
|
|
|
(1,448
|
)
|
|
|
(949
|
)
|
|
|
Less: Net loss attributable to non-controlling interests
|
|
|
|
(11
|
)
|
|
|
-
|
|
|
|
|
|
(12
|
)
|
|
|
-
|
|
|
|
Net loss attributable to Dell Technologies Inc.
|
|
|
$
|
(2,064
|
)
|
|
$
|
(180
|
)
|
|
|
|
$
|
(1,436
|
)
|
|
$
|
(949
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share attributable to Dell Technologies Inc. -
basic:
|
|
|
|
|
|
|
|
|
|
Continuing operations - Class V Common Stock - basic
|
|
|
$
|
0.79
|
|
|
$
|
-
|
|
|
|
|
$
|
0.79
|
|
|
$
|
-
|
|
|
|
Continuing operations - DHI Group - basic
|
|
|
$
|
(3.62
|
)
|
|
$
|
(0.65
|
)
|
|
|
|
$
|
(5.70
|
)
|
|
$
|
(2.47
|
)
|
|
|
Discontinued operations - DHI Group - basic
|
|
|
$
|
(0.88
|
)
|
|
$
|
0.21
|
|
|
|
|
$
|
2.01
|
|
|
$
|
0.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (loss) per share attributable to Dell Technologies Inc. -
diluted:
|
|
|
|
|
|
|
|
|
|
Continuing operations - Class V Common Stock - diluted
|
|
|
$
|
0.78
|
|
|
$
|
-
|
|
|
|
|
$
|
0.78
|
|
|
$
|
-
|
|
|
|
Continuing operations - DHI Group - diluted
|
|
|
$
|
(3.63
|
)
|
|
$
|
(0.65
|
)
|
|
|
|
$
|
(5.70
|
)
|
|
$
|
(2.47
|
)
|
|
|
Discontinued operations - DHI Group - diluted
|
|
|
$
|
(0.88
|
)
|
|
$
|
0.21
|
|
|
|
|
$
|
2.01
|
|
|
$
|
0.13
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic - Class V Common Stock
|
|
|
|
222
|
|
|
|
-
|
|
|
|
|
|
222
|
|
|
|
-
|
|
|
|
Diluted - Class V Common Stock
|
|
|
|
222
|
|
|
|
-
|
|
|
|
|
|
222
|
|
|
|
-
|
|
|
|
Basic - DHI Group
|
|
|
|
497
|
|
|
|
405
|
|
|
|
|
|
436
|
|
|
|
405
|
|
|
|
Diluted - DHI Group
|
|
|
|
497
|
|
|
|
405
|
|
|
|
|
|
436
|
|
|
|
405
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of Total Net Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
|
|
24.0
|
%
|
|
|
16.8
|
%
|
|
|
|
|
20.3
|
%
|
|
|
16.0
|
%
|
|
|
Selling, general, and administrative
|
|
|
|
28.0
|
%
|
|
|
15.3
|
%
|
|
|
|
|
20.8
|
%
|
|
|
15.3
|
%
|
|
|
Research, development, and engineering
|
|
|
|
5.3
|
%
|
|
|
2.1
|
%
|
|
|
|
|
3.3
|
%
|
|
|
2.0
|
%
|
|
|
Operating expenses
|
|
|
|
33.3
|
%
|
|
|
17.4
|
%
|
|
|
|
|
24.1
|
%
|
|
|
17.3
|
%
|
|
|
Operating loss
|
|
|
|
(9.3
|
%)
|
|
|
(0.6
|
%)
|
|
|
|
|
(3.8
|
%)
|
|
|
(1.3
|
%)
|
|
|
Loss from continuing operations before income taxes
|
|
|
|
(14.2
|
%)
|
|
|
(2.2
|
%)
|
|
|
|
|
(7.1
|
%)
|
|
|
(2.8
|
%)
|
|
|
Net loss from continuing operations
|
|
|
|
(10.1
|
%)
|
|
|
(2.1
|
%)
|
|
|
|
|
(5.6
|
%)
|
|
|
(2.6
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax rate
|
|
|
|
29.0
|
%
|
|
|
6.0
|
%
|
|
|
|
|
21.1
|
%
|
|
|
8.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELL TECHNOLOGIES INC.
|
Condensed Consolidated Statements of Financial Position
|
(in millions; unaudited)
|
|
|
|
|
|
|
|
|
|
October 28, 2016
|
|
January 29, 2016
|
Assets:
|
|
|
|
|
|
Current assets:
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$
|
8,822
|
|
$
|
6,322
|
Short-term investments
|
|
|
|
1,857
|
|
|
-
|
Accounts receivable, net
|
|
|
|
8,830
|
|
|
4,887
|
Short-term financing receivables, net
|
|
|
|
3,049
|
|
|
2,915
|
Inventories, net
|
|
|
|
3,504
|
|
|
1,619
|
Other current assets
|
|
|
|
4,441
|
|
|
3,497
|
Current assets held for sale
|
|
|
|
5,904
|
|
|
4,333
|
Total current assets
|
|
|
|
36,407
|
|
|
23,573
|
Property, plant, and equipment, net
|
|
|
|
5,805
|
|
|
1,649
|
Long-term investments
|
|
|
|
4,285
|
|
|
114
|
Long-term financing receivables, net
|
|
|
|
2,390
|
|
|
2,177
|
Goodwill
|
|
|
|
38,840
|
|
|
8,406
|
Intangible assets, net
|
|
|
|
36,571
|
|
|
8,577
|
Other non-current assets
|
|
|
|
1,334
|
|
|
626
|
Total assets
|
|
|
$
|
125,632
|
|
$
|
45,122
|
|
|
|
|
|
|
Liabilities, Redeemable Shares, and
Stockholders' Equity:
|
|
|
|
|
|
Current liabilities:
|
|
|
|
|
|
Short-term debt
|
|
|
$
|
8,388
|
|
$
|
2,981
|
Accounts payable
|
|
|
|
14,644
|
|
|
12,881
|
Accrued and other
|
|
|
|
7,445
|
|
|
4,217
|
Short-term deferred revenue
|
|
|
|
9,215
|
|
|
3,632
|
Current liabilities held for sale
|
|
|
|
1,677
|
|
|
1,599
|
Total current liabilities
|
|
|
|
41,369
|
|
|
25,310
|
Long-term debt
|
|
|
|
47,284
|
|
|
10,650
|
Long-term deferred revenue
|
|
|
|
7,907
|
|
|
4,089
|
Other non-current liabilities
|
|
|
|
9,066
|
|
|
3,501
|
Total liabilities
|
|
|
|
105,626
|
|
|
43,550
|
|
|
|
|
|
|
Redeemable shares
|
|
|
|
187
|
|
|
106
|
|
|
|
|
|
|
Total Dell Technologies Inc. stockholders' equity
|
|
|
|
13,880
|
|
|
1,466
|
Non-controlling interests
|
|
|
|
5,939
|
|
|
-
|
Total stockholders' equity
|
|
|
|
19,819
|
|
|
1,466
|
Total liabilities, redeemable shares, and stockholders' equity
|
|
|
$
|
125,632
|
|
$
|
45,122
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELL TECHNOLOGIES INC.
|
Condensed Consolidated Statements of Cash Flows
|
(in millions; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
|
|
|
October 28, 2016
|
|
October 30, 2015
|
|
October 28, 2016
|
|
October 30, 2015
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
|
$
|
(2,075
|
)
|
|
$
|
(180
|
)
|
|
$
|
(1,448
|
)
|
|
$
|
(949
|
)
|
Adjustments to reconcile net loss to net cash provided by
operating activities:
|
|
|
|
1,806
|
|
|
|
639
|
|
|
|
2,994
|
|
|
|
2,140
|
|
Change in cash from operating activities
|
|
|
|
(269
|
)
|
|
|
459
|
|
|
|
1,546
|
|
|
|
1,191
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
Investments:
|
|
|
|
|
|
|
|
|
|
Purchases
|
|
|
|
(503
|
)
|
|
|
-
|
|
|
|
(511
|
)
|
|
|
(26
|
)
|
Maturities and sales
|
|
|
|
543
|
|
|
|
-
|
|
|
|
561
|
|
|
|
1
|
|
Capital expenditures
|
|
|
|
(182
|
)
|
|
|
(110
|
)
|
|
|
(417
|
)
|
|
|
(340
|
)
|
Proceeds from sale of facilities, land, and other assets
|
|
|
|
5
|
|
|
|
3
|
|
|
|
24
|
|
|
|
88
|
|
Capitalized software development costs
|
|
|
|
(85
|
)
|
|
|
-
|
|
|
|
(85
|
)
|
|
|
-
|
|
Collections on purchased financing receivables
|
|
|
|
6
|
|
|
|
22
|
|
|
|
31
|
|
|
|
71
|
|
Acquisition of businesses, net of cash acquired
|
|
|
|
(37,614
|
)
|
|
|
-
|
|
|
|
(37,614
|
)
|
|
|
-
|
|
Divestitures of businesses, net of cash transferred
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
8
|
|
Other
|
|
|
|
(8
|
)
|
|
|
-
|
|
|
|
(48
|
)
|
|
|
-
|
|
Change in cash from investing activities
|
|
|
|
(37,838
|
)
|
|
|
(85
|
)
|
|
|
(38,059
|
)
|
|
|
(198
|
)
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
Payment of dissenting shares obligation
|
|
|
|
-
|
|
|
|
-
|
|
|
|
(446
|
)
|
|
|
-
|
|
Proceeds from the issuance of DHI Group common stock
|
|
|
|
4,404
|
|
|
|
-
|
|
|
|
4,404
|
|
|
|
-
|
|
Proceeds from the issuance of common stock of subsidiaries
|
|
|
|
1
|
|
|
|
-
|
|
|
|
1
|
|
|
|
-
|
|
Repurchases of DHI Group common stock
|
|
|
|
(8
|
)
|
|
|
-
|
|
|
|
(10
|
)
|
|
|
Repurchases of Class V Group common stock
|
|
|
|
(132
|
)
|
|
|
-
|
|
|
|
(132
|
)
|
|
|
-
|
|
Repurchases of common stock of subsidiaries
|
|
|
|
(611
|
)
|
|
|
-
|
|
|
|
(611
|
)
|
|
|
-
|
|
Contributions from non-controlling interests, net
|
|
|
|
-
|
|
|
|
-
|
|
|
|
100
|
|
|
|
-
|
|
Issuance of common stock under employee plans
|
|
|
|
-
|
|
|
|
-
|
|
|
|
-
|
|
|
|
2
|
|
Payments for debt issuance costs
|
|
|
|
(834
|
)
|
|
|
(3
|
)
|
|
|
(849
|
)
|
|
|
(10
|
)
|
Proceeds from debt
|
|
|
|
43,838
|
|
|
|
1,815
|
|
|
|
45,986
|
|
|
|
4,893
|
|
Repayments of debt
|
|
|
|
(7,000
|
)
|
|
|
(2,459
|
)
|
|
|
(9,638
|
)
|
|
|
(5,208
|
)
|
Other
|
|
|
|
1
|
|
|
|
(1
|
)
|
|
|
5
|
|
|
|
2
|
|
Change in cash from financing activities
|
|
|
|
39,659
|
|
|
|
(648
|
)
|
|
|
38,810
|
|
|
|
(321
|
)
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
|
(21
|
)
|
|
|
(38
|
)
|
|
|
31
|
|
|
|
(88
|
)
|
|
|
|
|
|
|
|
|
|
|
Change in cash and cash equivalents
|
|
|
|
1,531
|
|
|
|
(312
|
)
|
|
|
2,328
|
|
|
|
584
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of the period
|
|
|
|
7,373
|
|
|
|
6,294
|
|
|
|
6,576
|
|
|
|
5,398
|
|
Cash and cash equivalents at end of the period
|
|
|
$
|
8,904
|
|
|
$
|
5,982
|
|
|
$
|
8,904
|
|
|
$
|
5,982
|
|
Less: Cash included in assets held for sale
|
|
|
|
82
|
|
|
|
328
|
|
|
|
82
|
|
|
|
328
|
|
Cash and cash equivalents from continuing operations
|
|
|
$
|
8,822
|
|
|
$
|
5,654
|
|
|
$
|
8,822
|
|
|
$
|
5,654
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
These tables present information about the Company's non-GAAP product
net revenue, non-GAAP services net revenue, non-GAAP net revenue,
non-GAAP product gross margin, non-GAAP services gross margin, non-GAAP
gross margin, non-GAAP operating expenses, non-GAAP operating income,
non-GAAP net income from continuing operations, EBITDA, and adjusted
EBITDA, which are non-GAAP financial measures provided as a supplement
to the results provided in accordance with generally accepted accounting
principles in the United States of America ("GAAP"). A detailed
discussion of Dell Technologies' reasons for including the non-GAAP
financial measures, the limitations associated with those measures, the
items excluded from non-GAAP metrics, and our reason for excluding those
items are presented in "Item 2 - Management's Discussion and Analysis of
Financial Condition and Results of Operations - Non-GAAP Financial
Measures" in Dell Technologies' quarterly report on Form 10-Q for the
quarterly period ended October 28, 2016. Dell Technologies encourages
investors to review the non-GAAP discussion in conjunction with the
presentation of non-GAAP financial measures.
|
|
DELL TECHNOLOGIES INC.
|
Reconciliation of Non-GAAP Financial Measures
|
(in millions, except percentages; unaudited; continued on next
page)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
% Growth Rates Yr. to Yr.
|
|
Nine Months Ended
|
|
% Growth Rates Yr. to Yr.
|
|
|
|
October 28, 2016
|
|
October 30, 2015
|
|
|
October 28, 2016
|
|
October 30, 2015
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product net revenue
|
|
|
$
|
12,366
|
|
|
$
|
10,638
|
|
|
16
|
%
|
|
$
|
33,510
|
|
|
$
|
32,100
|
|
|
4
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
261
|
|
|
|
(6
|
)
|
|
|
|
|
260
|
|
|
|
(20
|
)
|
|
|
Non-GAAP product net revenue
|
|
|
$
|
12,627
|
|
|
$
|
10,632
|
|
|
19
|
%
|
|
$
|
33,770
|
|
|
$
|
32,080
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services net revenue
|
|
|
$
|
3,881
|
|
|
$
|
2,036
|
|
|
91
|
%
|
|
$
|
8,058
|
|
|
$
|
6,132
|
|
|
31
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
269
|
|
|
|
113
|
|
|
|
|
|
413
|
|
|
|
390
|
|
|
|
Non-GAAP services net revenue
|
|
|
$
|
4,150
|
|
|
$
|
2,149
|
|
|
93
|
%
|
|
$
|
8,471
|
|
|
$
|
6,522
|
|
|
30
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net revenue
|
|
|
$
|
16,247
|
|
|
$
|
12,674
|
|
|
28
|
%
|
|
$
|
41,568
|
|
|
$
|
38,232
|
|
|
9
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
530
|
|
|
|
107
|
|
|
|
|
|
673
|
|
|
|
370
|
|
|
|
Non-GAAP net revenue
|
|
|
$
|
16,777
|
|
|
$
|
12,781
|
|
|
31
|
%
|
|
$
|
42,241
|
|
|
$
|
38,602
|
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Product gross margin
|
|
|
$
|
1,804
|
|
|
$
|
1,310
|
|
|
38
|
%
|
|
$
|
4,654
|
|
|
$
|
3,745
|
|
|
24
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
437
|
|
|
|
12
|
|
|
|
|
|
461
|
|
|
|
22
|
|
|
|
Amortization of intangibles
|
|
|
|
604
|
|
|
|
98
|
|
|
|
|
|
806
|
|
|
|
295
|
|
|
|
Transaction-related expenses
|
|
|
|
18
|
|
|
|
-
|
|
|
|
|
|
16
|
|
|
|
1
|
|
|
|
Other corporate expenses
|
|
|
|
10
|
|
|
|
3
|
|
|
|
|
|
14
|
|
|
|
6
|
|
|
|
Non-GAAP product gross margin
|
|
|
$
|
2,873
|
|
|
$
|
1,423
|
|
|
102
|
%
|
|
$
|
5,951
|
|
|
$
|
4,069
|
|
|
46
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Services gross margin
|
|
|
$
|
2,095
|
|
|
$
|
822
|
|
|
155
|
%
|
|
$
|
3,774
|
|
|
$
|
2,388
|
|
|
58
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
292
|
|
|
|
112
|
|
|
|
|
|
436
|
|
|
|
386
|
|
|
|
Amortization of intangibles
|
|
|
|
-
|
|
|
|
-
|
|
|
|
|
|
-
|
|
|
|
-
|
|
|
|
Transaction-related expenses
|
|
|
|
12
|
|
|
|
2
|
|
|
|
|
|
9
|
|
|
|
5
|
|
|
|
Other corporate expenses
|
|
|
|
52
|
|
|
|
-
|
|
|
|
|
|
54
|
|
|
|
1
|
|
|
|
Non-GAAP services gross margin
|
|
|
$
|
2,451
|
|
|
$
|
936
|
|
|
162
|
%
|
|
$
|
4,273
|
|
|
$
|
2,780
|
|
|
54
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross margin
|
|
|
$
|
3,899
|
|
|
$
|
2,132
|
|
|
83
|
%
|
|
$
|
8,428
|
|
|
$
|
6,133
|
|
|
37
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
729
|
|
|
|
124
|
|
|
|
|
|
897
|
|
|
|
408
|
|
|
|
Amortization of intangibles
|
|
|
|
604
|
|
|
|
98
|
|
|
|
|
|
806
|
|
|
|
295
|
|
|
|
Transaction-related expenses
|
|
|
|
30
|
|
|
|
2
|
|
|
|
|
|
25
|
|
|
|
6
|
|
|
|
Other corporate expenses
|
|
|
|
62
|
|
|
|
3
|
|
|
|
|
|
68
|
|
|
|
7
|
|
|
|
Non-GAAP gross margin
|
|
|
$
|
5,324
|
|
|
$
|
2,359
|
|
|
126
|
%
|
|
$
|
10,224
|
|
|
$
|
6,849
|
|
|
49
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses
|
|
|
$
|
5,411
|
|
|
$
|
2,210
|
|
|
145
|
%
|
|
$
|
10,012
|
|
|
$
|
6,621
|
|
|
51
|
%
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
(121
|
)
|
|
|
(25
|
)
|
|
|
|
|
(157
|
)
|
|
|
(67
|
)
|
|
|
Amortization of intangibles
|
|
|
|
(560
|
)
|
|
|
(394
|
)
|
|
|
|
|
(1,340
|
)
|
|
|
(1,183
|
)
|
|
|
Transaction-related expenses
|
|
|
|
(1,170
|
)
|
|
|
(25
|
)
|
|
|
|
|
(1,304
|
)
|
|
|
(61
|
)
|
|
|
Other corporate expenses
|
|
|
|
(211
|
)
|
|
|
(14
|
)
|
|
|
|
|
(257
|
)
|
|
|
(31
|
)
|
|
|
Non-GAAP operating expenses
|
|
|
$
|
3,349
|
|
|
$
|
1,752
|
|
|
91
|
%
|
|
$
|
6,954
|
|
|
$
|
5,279
|
|
|
32
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELL TECHNOLOGIES INC.
|
Reconciliation of Non-GAAP Financial Measures
|
(continued; in millions, except percentages; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
|
|
|
October 28, 2016
|
|
October 30, 2015
|
|
% Growth Rates Yr. to Yr.
|
|
October 28, 2016
|
|
October 30, 2015
|
|
% Growth Rates Yr. to Yr.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss
|
|
|
$
|
(1,512
|
)
|
|
$
|
(78
|
)
|
|
NM
|
|
|
$
|
(1,584
|
)
|
|
$
|
(488
|
)
|
|
(225
|
%)
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
850
|
|
|
|
149
|
|
|
|
|
|
1,054
|
|
|
|
475
|
|
|
|
Amortization of intangibles
|
|
|
|
1,164
|
|
|
|
492
|
|
|
|
|
|
2,146
|
|
|
|
1,478
|
|
|
|
Transaction-related expenses
|
|
|
|
1,200
|
|
|
|
27
|
|
|
|
|
|
1,329
|
|
|
|
67
|
|
|
|
Other corporate expenses
|
|
|
|
273
|
|
|
|
17
|
|
|
|
|
|
325
|
|
|
|
38
|
|
|
|
Non-GAAP operating income
|
|
|
$
|
1,975
|
|
|
$
|
607
|
|
|
225
|
%
|
|
$
|
3,270
|
|
|
$
|
1,570
|
|
|
108
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss from continuing operations
|
|
|
$
|
(1,637
|
)
|
|
$
|
(264
|
)
|
|
(520
|
%)
|
|
$
|
(2,323
|
)
|
|
$
|
(1,000
|
)
|
|
(132
|
%)
|
Non-GAAP adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impact of purchase accounting
|
|
|
|
850
|
|
|
|
149
|
|
|
|
|
|
1,054
|
|
|
|
475
|
|
|
|
Amortization of intangibles
|
|
|
|
1,164
|
|
|
|
492
|
|
|
|
|
|
2,146
|
|
|
|
1,478
|
|
|
|
Transaction-related expenses
|
|
|
|
1,200
|
|
|
|
21
|
|
|
|
|
|
1,326
|
|
|
|
41
|
|
|
|
Other corporate expenses
|
|
|
|
273
|
|
|
|
23
|
|
|
|
|
|
325
|
|
|
|
58
|
|
|
|
Aggregate adjustment for income taxes
|
|
|
|
(880
|
)
|
|
|
(127
|
)
|
|
|
|
|
(932
|
)
|
|
|
(381
|
)
|
|
|
Non-GAAP net income from continuing operations
|
|
|
$
|
970
|
|
|
$
|
294
|
|
|
230
|
%
|
|
$
|
1,596
|
|
|
$
|
671
|
|
|
138
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss from continuing operations
|
|
|
$
|
(1,637
|
)
|
|
$
|
(264
|
)
|
|
(520
|
%)
|
|
$
|
(2,323
|
)
|
|
$
|
(1,000
|
)
|
|
(132
|
%)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and other, net
|
|
|
|
794
|
|
|
|
203
|
|
|
|
|
|
1,362
|
|
|
|
600
|
|
|
|
Income tax benefit
|
|
|
|
(669
|
)
|
|
|
(17
|
)
|
|
|
|
|
(623
|
)
|
|
|
(88
|
)
|
|
|
Depreciation and amortization
|
|
|
|
1,576
|
|
|
|
627
|
|
|
|
|
|
2,799
|
|
|
|
1,871
|
|
|
|
EBITDA
|
|
|
$
|
64
|
|
|
$
|
549
|
|
|
(88
|
%)
|
|
$
|
1,215
|
|
|
$
|
1,383
|
|
|
(12
|
%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
$
|
64
|
|
|
$
|
549
|
|
|
(88
|
%)
|
|
$
|
1,215
|
|
|
$
|
1,383
|
|
|
(12
|
%)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock based compensation expense
|
|
|
|
144
|
|
|
|
17
|
|
|
|
|
|
177
|
|
|
|
46
|
|
|
|
Impact of purchase accounting
|
|
|
|
693
|
|
|
|
118
|
|
|
|
|
|
851
|
|
|
|
392
|
|
|
|
Transaction-related expenses
|
|
|
|
1,200
|
|
|
|
21
|
|
|
|
|
|
1,366
|
|
|
|
41
|
|
|
|
Other corporate expenses
|
|
|
|
129
|
|
|
|
6
|
|
|
|
|
|
148
|
|
|
|
18
|
|
|
|
Adjusted EBITDA
|
|
|
$
|
2,230
|
|
|
$
|
711
|
|
|
214
|
%
|
|
$
|
3,757
|
|
|
$
|
1,880
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DELL TECHNOLOGIES INC.
|
Segment Information
|
(in millions, except percentages; unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
% Growth
|
|
Nine Months Ended
|
|
% Growth
|
|
|
|
October 28,
|
|
October 30,
|
|
Rates
|
|
October 28,
|
|
October 30,
|
|
Rates
|
|
|
|
2016
|
|
2015
|
|
Yr. to Yr.
|
|
2016
|
|
2015
|
|
Yr. to Yr.
|
Client Solutions Group (CSG):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
|
|
|
$
|
6,400
|
|
|
$
|
6,437
|
|
|
(1
|
%)
|
|
$
|
19,343
|
|
|
$
|
19,778
|
|
|
(2
|
%)
|
Consumer
|
|
|
|
2,787
|
|
|
|
2,499
|
|
|
12
|
%
|
|
|
7,635
|
|
|
|
7,262
|
|
|
5
|
%
|
Total CSG net revenue
|
|
|
$
|
9,187
|
|
|
$
|
8,936
|
|
|
3
|
%
|
|
$
|
26,978
|
|
|
$
|
27,040
|
|
|
0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CSG operating income
|
|
|
$
|
634
|
|
|
$
|
384
|
|
|
65
|
%
|
|
$
|
1,503
|
|
|
$
|
926
|
|
|
62
|
%
|
% of CSG net revenue
|
|
|
|
6.9
|
%
|
|
|
4.3
|
%
|
|
|
|
|
|
5.6
|
%
|
|
|
3.4
|
%
|
|
|
|
% of total segment operating income
|
|
|
|
30.5
|
%
|
|
|
59.9
|
%
|
|
|
|
|
|
43.7
|
%
|
|
|
54.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Infrastructure Solutions Group (ISG):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Servers and networking
|
|
|
$
|
2,910
|
|
|
$
|
3,163
|
|
|
(8
|
%)
|
|
$
|
9,222
|
|
|
$
|
9,527
|
|
|
(3
|
%)
|
Storage
|
|
|
|
3,079
|
|
|
|
548
|
|
|
462
|
%
|
|
|
4,159
|
|
|
|
1,655
|
|
|
151
|
%
|
Total ISG net revenue
|
|
|
$
|
5,989
|
|
|
$
|
3,711
|
|
|
61
|
%
|
|
$
|
13,381
|
|
|
$
|
11,182
|
|
|
20
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ISG operating income
|
|
|
$
|
897
|
|
|
$
|
257
|
|
|
249
|
%
|
|
$
|
1,389
|
|
|
$
|
776
|
|
|
79
|
%
|
% of ISG net revenue
|
|
|
|
15.0
|
%
|
|
|
6.9
|
%
|
|
|
|
|
|
10.4
|
%
|
|
|
6.9
|
%
|
|
|
|
% of total segment operating income
|
|
|
|
43.1
|
%
|
|
|
40.1
|
%
|
|
|
|
|
|
40.4
|
%
|
|
|
45.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VMware:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total VMware net revenue
|
|
|
$
|
1,289
|
|
|
$
|
-
|
|
|
NA
|
|
$
|
1,289
|
|
|
$
|
-
|
|
|
NA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
VMware operating income
|
|
|
$
|
548
|
|
|
$
|
-
|
|
|
NA
|
|
$
|
548
|
|
|
$
|
-
|
|
|
NA
|
% of VMware net revenue
|
|
|
|
42.5
|
%
|
|
NA
|
|
|
|
|
|
42.5
|
%
|
|
NA
|
|
|
|
% of total segment operating income
|
|
|
|
26.4
|
%
|
|
NA
|
|
|
|
|
|
15.9
|
%
|
|
NA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation to consolidated net
revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reportable segment net revenue
|
|
|
$
|
16,465
|
|
|
$
|
12,647
|
|
|
|
|
|
$
|
41,648
|
|
|
$
|
38,222
|
|
|
|
|
Other businesses (a)
|
|
|
|
312
|
|
|
|
104
|
|
|
|
|
|
|
530
|
|
|
|
279
|
|
|
|
|
Unallocated transactions (b)
|
|
|
|
-
|
|
|
|
30
|
|
|
|
|
|
|
63
|
|
|
|
101
|
|
|
|
|
Impact of purchase accounting (c)
|
|
|
|
(530
|
)
|
|
|
(107
|
)
|
|
|
|
|
|
(673
|
)
|
|
|
(370
|
)
|
|
|
|
Total consolidated net revenue
|
|
|
$
|
16,247
|
|
|
$
|
12,674
|
|
|
|
|
|
$
|
41,568
|
|
|
$
|
38,232
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation to consolidated
operating income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
Reportable segment operating income
|
|
|
$
|
2,079
|
|
|
$
|
641
|
|
|
|
|
|
$
|
3,440
|
|
|
$
|
1,702
|
|
|
|
|
Other businesses (a)
|
|
|
|
(13
|
)
|
|
|
(15
|
)
|
|
|
|
|
|
(48
|
)
|
|
|
(50
|
)
|
|
|
|
Unallocated transactions (b)
|
|
|
|
(91
|
)
|
|
|
(19
|
)
|
|
|
|
|
|
(122
|
)
|
|
|
(82
|
)
|
|
|
|
Impact of purchase accounting (c)
|
|
|
|
(850
|
)
|
|
|
(149
|
)
|
|
|
|
|
|
(1,054
|
)
|
|
|
(475
|
)
|
|
|
|
Amortization of intangibles
|
|
|
|
(1,164
|
)
|
|
|
(492
|
)
|
|
|
|
|
|
(2,146
|
)
|
|
|
(1,478
|
)
|
|
|
|
Transaction-related expenses (d)
|
|
|
|
(1,200
|
)
|
|
|
(27
|
)
|
|
|
|
|
|
(1,329
|
)
|
|
|
(67
|
)
|
|
|
|
Other corporate expenses (e)
|
|
|
|
(273
|
)
|
|
|
(17
|
)
|
|
|
|
|
|
(325
|
)
|
|
|
(38
|
)
|
|
|
|
Total operating loss
|
|
|
$
|
(1,512
|
)
|
|
$
|
(78
|
)
|
|
|
|
|
$
|
(1,584
|
)
|
|
$
|
(488
|
)
|
|
|
|
_________________
|
(a) Other businesses consist of RSA Information Security,
SecureWorks, Pivotal, and Boomi offerings, and do not constitute
reportable segments.
|
(b) Unallocated transactions includes long-term incentives, certain
short-term incentive compensation expenses, and other corporate
items that are not allocated to Dell Technologies' reportable
segments.
|
(c) Impact of purchase accounting includes non-cash purchase
accounting adjustments related to the EMC merger transaction, as
well as the going-private transaction.
|
(d) Transaction-related expenses includes acquisition and
integration related costs.
|
(e) Other corporate expenses includes severance and facility action
costs as well as stock-based compensation expense.
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20161208005302/en/
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