☑
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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☐
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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94-3292913
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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|
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3401 Hillview Avenue
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Palo Alto,
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CA
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94304
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Trading Symbol(s)
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Name of each exchange on which registered
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Class A common stock
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VMW
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New York Stock Exchange
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Large accelerated filer
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☑
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Page
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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Item 16.
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ITEM 1.
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BUSINESS
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•
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Compute
|
•
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Cloud Management
|
•
|
Networking
|
•
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Storage and Availability
|
•
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vRealize Operations—provides performance, capacity and configuration management for virtual or physical infrastructure as well as transparency and control over the costs and quality of IT services.
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•
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vRealize Automation—enables customers to rapidly deploy and provision cloud services.
|
•
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Wavefront by VMware—provides a SaaS-based metrics monitoring and analytics platform for modern cloud-native applications.
|
•
|
CloudHealth by VMware—delivers a consistent cloud operations platform across AWS, Azure and Google Cloud, enabling customers to analyze and manage cloud costs, usage, security and performance centrally for native public clouds.
|
•
|
VMware NSX (“NSX”)—our network virtualization solution, abstracts physical networks and greatly simplifies the provisioning and consumption of networking and security resources. NSX can be layered into any environment, integrates with many automation, security and container solutions and is an integral part of our key offerings, including VMware Cloud Foundation, VMware Cloud on AWS and Pivotal Container Service.
|
•
|
VMware SD-WAN by VeloCloud—available as a service and as an on-premises software solution, enables simple, agile and more secure branch connectivity. Our SD-WAN solution serves as a platform for deploying virtual network services that integrate with local edge compute to manage and control application traffic from users and Internet-connected devices.
|
•
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Network Insight—delivers intelligent operations and planning for software-defined networking and security across virtual, physical and multi-cloud environments.
|
•
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VMware NSX Advanced Load Balancer by Avi Networks—provides consistent, multi-cloud load balancing, web application firewall and application insights across data centers and public clouds. We acquired Avi Networks, Inc., a provider of multi-cloud application delivery services in July 2019.
|
•
|
VMware vSAN (“vSAN”)—clusters server disks to create simple, shared storage designed for virtual machines in hyperconverged infrastructure.
|
•
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VxRail—a hyperconverged infrastructure solution comprised of a fully integrated and pre-configured Dell EMC Appliance powered by vSAN and vSphere software.
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•
|
VMware vRealize Suite—an enterprise-ready cloud management platform that enables customers to manage heterogeneous, multi-cloud environments.
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•
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VMware vCloud Suite—an integrated offering that brings together our vSphere hypervisor and our vRealize Suite multi-vendor multi-cloud management platform.
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•
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Unified Endpoint Management—a platform built to manage and help secure endpoints across all major operating systems from a single management console, enabling customers to more effectively manage, secure and benefit from “bring your own device” programs.
|
•
|
Horizon—a virtual platform that provides a streamlined approach to delivering, protecting and managing virtual desktops and applications from one digital workspace, while containing costs and allowing end users to work anytime, anywhere and across any device.
|
•
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Pivotal Cloud Foundry—a cloud-native platform, leveraging Cloud Foundry open-source software, that provides a consistent way to launch, and develop on, applications using common programming languages and frameworks across private, public and multi-cloud environments.
|
•
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Pivotal Application Service—allows enterprises to continuously deploy and operate custom software more securely and at scale across popular private and public clouds.
|
•
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Pivotal Container Service—a container management platform that allows enterprises to deploy and operate Kubernetes, an open-source system for container orchestration, in an enterprise-grade manner across private and public clouds.
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•
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Pivotal Labs—a service that assists enterprises in accelerating their cloud‑native transformation by implementing modern agile development practices.
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•
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Heptio—an offering of products and services that helps enterprises deploy and operationalize Kubernetes.
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•
|
VMware Carbon Black Cloud platform—consolidates endpoint security and IT operations with a universal agent and single console to adapt cyberattack prevention to each organization, ease analysis of the most complex attacks, and simplify the automation of detection and response workflows. VMware Carbon Black Cloud platform identifies attackers’ changing behavior patterns, enabling customers to better detect, respond to and prevent emerging attacks. Our main Endpoint Protection solutions include next-generation antivirus, endpoint detection and response, and application control.
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•
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AppDefense—adds zero-trust security to help protect applications running in virtualized environments.
|
•
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VMware Workspace ONE platform—enables users to securely access data and applications from any device. Key built-in security capabilities include single sign on functionality, conditional access and multi-factor authentication. In addition, Workspace ONE Intelligence delivers insights into the digital workspace environment, including analytics on user behaviors and device compliance, and automated remediation processes.
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•
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our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to those reports, as soon as reasonably practicable after we electronically file that material with or furnish it to the Securities and Exchange Commission (“SEC”);
|
•
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announcements of investor conferences, speeches and events at which our executives discuss our products, services and competitive strategies;
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•
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webcasts of our quarterly earnings calls and links to webcasts of investor conferences at which our executives appear (archives of these events are also available for a limited time);
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•
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additional information on financial metrics, including reconciliations of non-GAAP financial measures discussed in our presentations to the nearest comparable GAAP measure;
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•
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press releases on quarterly earnings, product and service announcements, legal developments and international news;
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•
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corporate governance information including our certificate of incorporation, bylaws, corporate governance guidelines, board committee charters, business conduct guidelines (which constitutes our code of business conduct and ethics) and other governance-related policies;
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•
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other news, blogs and announcements that we may post from time to time that investors might find useful or interesting; and
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•
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opportunities to sign up for email alerts and RSS feeds to have information pushed in real time.
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Name
|
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Age
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Position(s)
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Patrick Gelsinger
|
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59
|
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Chief Executive Officer and Director
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Zane Rowe
|
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49
|
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Chief Financial Officer and Executive Vice President
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Jean-Pierre Brulard
|
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61
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Executive Vice President, Worldwide Sales
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Amy Fliegelman Olli
|
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56
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Senior Vice President, General Counsel and Secretary
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Sanjay Poonen
|
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50
|
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Chief Operating Officer, Customer Operations
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Rangarajan (Raghu) Raghuram
|
|
57
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Chief Operating Officer, Products and Cloud Services
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Rajiv Ramaswami
|
|
54
|
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Chief Operating Officer, Products and Cloud Services
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ITEM 1A.
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RISK FACTORS
|
•
|
sensitive data regarding our business, including intellectual property and other proprietary data, could be stolen;
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•
|
our electronic communications systems, including email and other methods, could be disrupted, and our ability to conduct our business operations could be seriously damaged until such systems can be restored and secured;
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•
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our ability to process customer orders and electronically deliver products and services could be degraded, and our distribution channels could be disrupted, resulting in delays in revenue recognition;
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•
|
defects and security vulnerabilities could be exploited or introduced into our software products or our subscription and SaaS offerings and impair or disrupt their availability, thereby damaging the reputation and perceived reliability and security of our products and services and potentially making the data systems of our customers vulnerable to further data loss and cyber incidents; and
|
•
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personally identifiable or confidential data of our customers, employees and business partners could be stolen or lost.
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•
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fluctuations in demand, adoption rates, sales cycles and pricing levels for our products and services;
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•
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variations in customer choices among our on-premises and subscription and SaaS offerings, which can impact our rates of total revenue and license revenue growth;
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•
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changes in customers’ budgets for information technology purchases and in the timing of their purchasing decisions;
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•
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the timing of announcements or releases of new or upgraded products and services by us or by our competitors;
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•
|
the timing and size of business realignment plans and restructuring charges;
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•
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our ability to maintain scalable internal systems for reporting, order processing, license fulfillment, product delivery, purchasing, billing and general accounting, among other functions;
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•
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our ability to control costs, including our operating expenses;
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•
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the credit risks associated with our distributors, who account for a significant portion of our product revenue and accounts receivable, and our customers;
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•
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the timing of when sales orders are processed, which can cause fluctuations in our backlog and impact our bookings and timing of revenue recognition;
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•
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seasonal factors such as the end of fiscal period budget expenditures by our customers and the timing of holiday and vacation periods;
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•
|
renewal rates and the amounts of the renewals for EAs as original EA terms expire;
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•
|
the timing and amount of internally developed software development costs that may be capitalized;
|
•
|
unplanned events that could affect market perception of the quality or cost-effectiveness of our products and solutions;
|
•
|
increased volatility in the provision for income taxes in periods in which transfers of intellectual property between our legal entities occur; and
|
•
|
our ability to accurately predict the degree to which customers will elect to purchase our subscription-based offerings in place of licenses to our on-premises offerings.
|
•
|
disrupting our ongoing operations and diverting management from day-to-day responsibilities;
|
•
|
increasing our expenses, and adversely impacting our business, financial condition and operating results, including, for example, the dilutive impact on our operating margin and earnings per share that we expect from our acquisitions of Carbon Black and Pivotal;
|
•
|
the costs of integrating business operations and on-boarding personnel, particularly for larger acquisitions such as Carbon Black and Pivotal;
|
•
|
failure of an acquired business to further our business strategy;
|
•
|
uncertainties in achieving the expected benefits of an acquisition or disposition, including enhanced revenue, technology, human resources, cost savings, operating efficiencies and other synergies;
|
•
|
reducing cash available for operations, stock repurchase programs and other uses and resulting in potentially dilutive issuances of equity securities or the incurrence of additional debt;
|
•
|
incurring amortization expense related to identifiable intangible assets acquired that could impact our operating results;
|
•
|
difficulty integrating the operations, systems, technologies, products and personnel of acquired businesses effectively;
|
•
|
the need to provide transition services in connection with a disposition that may result in the diversion of resources and focus;
|
•
|
difficulty achieving expected business results due to a lack of experience in new markets, products or technologies or the initial dependence on unfamiliar distribution partners or vendors;
|
•
|
retaining and motivating key personnel from acquired companies;
|
•
|
declining employee morale and retention issues affecting employees of businesses that we acquire or dispose of, which may result from changes in compensation, or changes in management, reporting relationships, future prospects or the direction of the acquired or disposed business;
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•
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assuming the liabilities of an acquired business, including acquired litigation-related liabilities and regulatory compliance issues, and potential litigation or regulatory action arising from a proposed or completed acquisition;
|
•
|
lawsuits resulting from an acquisition or disposition;
|
•
|
maintaining good relationships with customers or business partners of an acquired business or our own customers as a result of any integration of operations or the divestiture of a business upon which our customers rely;
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•
|
unidentified issues not discovered during the diligence process, including issues with the acquired or divested business’s intellectual property, product quality, security, privacy practices, accounting practices, regulatory compliance or legal contingencies;
|
•
|
maintaining or establishing acceptable standards, controls, procedures or policies with respect to an acquired business;
|
•
|
risks relating to the challenges and costs of closing a transaction;
|
•
|
the accounting consequences of certain acquisitions which may vary by deal structure, including, for instance, the need to account for our acquisition of Pivotal as a transaction between entities under common control, which requires prior period financial statements of VMware to be recast as if we had owned Pivotal and operated as one entity for all periods presented; and
|
•
|
the need to later divest acquired assets at a loss if an acquisition does not meet our expectations.
|
•
|
difficulties in enforcing contracts and collecting accounts receivable and longer payment cycles, especially in emerging markets;
|
•
|
difficulties in delivering support, training and documentation in certain foreign markets;
|
•
|
tariffs and trade barriers, which could increase due to the current geopolitical climate, and other regulatory or contractual limitations on our ability to sell or develop our products and services in certain foreign markets;
|
•
|
changes and instability in government policies and international trade arrangements that could adversely affect the ability of U.S.-based companies to conduct business in non-U.S. markets;
|
•
|
economic or political instability and security concerns in countries that are important to our international sales and operations;
|
•
|
difficulties in transferring funds from certain countries;
|
•
|
increased compliance risks, particularly in emerging markets; and
|
•
|
difficulties in maintaining appropriate controls relating to revenue recognition practices.
|
•
|
requiring the dedication of a portion of our expected cash flow from operations to service our indebtedness, thereby reducing the amount of expected cash flow available for other purposes, including capital expenditures and acquisitions; and
|
•
|
limiting our flexibility in planning for, or reacting to, changes in our business and our industry.
|
•
|
pay significant damages;
|
•
|
stop distributing our products that contain the open source software;
|
•
|
revise or modify our product code to remove alleged infringing code;
|
•
|
release the source code of our proprietary software; or
|
•
|
take other steps to avoid or remedy an alleged infringement.
|
•
|
Dell is able to control matters requiring our stockholders’ approval, including the election of a majority of our directors as described in the risk factors below.
|
•
|
Dell could implement changes to our business, including changing our commercial relationship with Dell or taking other corporate actions, such as participating in business combinations, that our other stockholders may not view as beneficial.
|
•
|
We have arrangements with a number of companies that compete with Dell, and our relationship with Dell could adversely affect our relationships with these companies or other customers, suppliers and partners.
|
•
|
Since the Dell Acquisition, the portion of our bookings that are realized through Dell sales channels has grown more rapidly than our sales through non-Dell resellers and distributors, and we expect this trend to continue. To the extent that we find ourselves relying more heavily upon Dell for our channel sales, Dell’s leverage over our sales and marketing efforts may increase and our ability to negotiate favorable go-to-market arrangements with Dell and with other channel partners may decline.
|
•
|
Dell has a right to approve certain matters under our certificate of incorporation, including acquisitions or investments in excess of $100 million, and Dell may choose not to consent to matters that our board of directors believes are in the best interests of VMware.
|
•
|
Synergies and benefits that we expect from our relationship with Dell may not be realized.
|
•
|
Dell is highly leveraged and commits a substantial portion of its cash flows to servicing its indebtedness. Dell’s significant debt could create the perception that Dell may exercise its control over us to limit our growth in favor of its other businesses or cause us to transfer cash to Dell. In addition, if Dell defaults, or appears in danger of defaulting, on its indebtedness, uncertainty as to the impact of such a default on VMware could disrupt our business.
|
•
|
Investor perceptions of Dell’s performance, future plans and prospects could contribute to volatility in the price of our Class A common stock.
|
•
|
Some of our products compete directly with products sold or distributed by Dell, which could result in reduced sales.
|
•
|
that a majority of our board of directors consists of independent directors;
|
•
|
that we have a corporate governance and nominating committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities;
|
•
|
that we have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee’s purpose and responsibilities; and
|
•
|
for an annual performance evaluation of the nominating and governance committee and compensation committee.
|
•
|
the division of our board of directors into three classes, with each class serving for a staggered three-year term, which prevents stockholders from electing an entirely new board of directors at any annual meeting;
|
•
|
the right of the board of directors to elect a director to fill a vacancy created by the expansion of the board of directors;
|
•
|
following a 355 Distribution of Class B common stock by Dell to its stockholders, the restriction that a beneficial owner of 10% or more of our Class B common stock may not vote in any election of directors unless such person or group also owns at least an equivalent percentage of Class A common stock or obtains approval of our board of directors prior to acquiring beneficial ownership of at least 5% of Class B common stock;
|
•
|
the prohibition of cumulative voting in the election of directors or any other matters, which would otherwise allow less than a majority of stockholders to elect director candidates;
|
•
|
the requirement for advance notice for nominations for election to the board of directors or for proposing matters that can be acted upon at a stockholders’ meeting;
|
•
|
the ability of the board of directors to issue, without stockholder approval, up to 100,000,000 shares of preferred stock with terms set by the board of directors, which rights could be senior to those of common stock; and
|
•
|
in the event that Dell or its successor-in-interest no longer owns shares of our common stock representing at least a majority of the votes entitled to be cast in the election of directors, stockholders may not act by written consent and may not call special meetings of the stockholders.
|
ITEM 1B.
|
UNRESOLVED STAFF COMMENTS
|
ITEM 2.
|
PROPERTIES
|
Location
|
|
|
Approximate
Sq. Ft.
|
|
Principal Use(s)
|
|
Palo Alto, CA
|
owned:
|
|
1,604,769
|
|
(1)
|
Executive and administrative offices, sales and marketing, and R&D
|
North and Latin American region
|
leased:
|
|
1,820,256
|
|
|
Administrative offices, sales and marketing, R&D and data center
|
Asia Pacific region
|
leased:
|
|
1,949,679
|
|
|
Administrative offices, sales and marketing, R&D and data center
|
Europe, Middle East and Africa region
|
leased:
|
|
836,509
|
|
|
Administrative offices, sales and marketing, R&D and data center
|
ITEM 3.
|
LEGAL PROCEEDINGS
|
ITEM 4.
|
MINE SAFETY DISCLOSURES
|
ITEM 5.
|
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
|
Total Number of Shares Purchased
|
|
Average Price Paid Per Share(1)
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Approximate Dollar Value of Shares That May Yet Be Purchased Under the Publicly Announced Plans or Programs(2)
|
||||||
November 2 – November 29, 2019
|
330,700
|
|
|
$
|
166.29
|
|
|
330,700
|
|
|
$
|
1,000,397,897
|
|
November 30 – December 27, 2019
|
—
|
|
|
—
|
|
|
—
|
|
|
1,000,397,897
|
|
||
December 28, 2019 – January 31, 2020
|
—
|
|
|
—
|
|
|
—
|
|
|
1,000,397,897
|
|
||
|
330,700
|
|
|
$
|
166.29
|
|
|
330,700
|
|
|
1,000,397,897
|
|
(1)
|
The average price paid per share excludes commissions.
|
|
Base Period
12/31/2014
|
|
12/31/2015
|
|
12/31/2016
|
|
2/3/2017
|
|
2/2/2018
|
|
2/1/2019
|
|
1/31/2020
|
||||||||||||||
VMware, Inc.
|
$
|
100.00
|
|
|
$
|
68.55
|
|
|
$
|
95.41
|
|
|
$
|
107.79
|
|
|
$
|
148.72
|
|
|
$
|
219.56
|
|
|
$
|
215.98
|
|
S&P 500 Index
|
100.00
|
|
|
101.38
|
|
|
113.51
|
|
|
116.65
|
|
|
143.05
|
|
|
142.97
|
|
|
173.79
|
|
|||||||
S&P 500 Systems Software Index
|
100.00
|
|
|
110.47
|
|
|
125.09
|
|
|
129.57
|
|
|
183.68
|
|
|
205.99
|
|
|
326.19
|
|
ITEM 6.
|
SELECTED FINANCIAL DATA
|
|
|
|
Transition Period
|
||||||||||||||||||||
|
For the Year Ended
|
|
January 1 to
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
December 31,
|
|
December 31,
|
|
February 3,
|
||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
2016
|
|
2015
|
|
2017(6)
|
||||||||||||
Results of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
License
|
$
|
3,181
|
|
|
$
|
3,042
|
|
|
$
|
2,628
|
|
|
$
|
2,350
|
|
|
$
|
2,404
|
|
|
$
|
69
|
|
Subscription and SaaS
|
1,877
|
|
|
1,303
|
|
|
927
|
|
|
687
|
|
|
502
|
|
|
90
|
|
||||||
Services
|
5,753
|
|
|
5,268
|
|
|
4,781
|
|
|
4,403
|
|
|
4,015
|
|
|
383
|
|
||||||
GSA settlement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(76
|
)
|
|
—
|
|
||||||
Total revenue
|
$
|
10,811
|
|
|
$
|
9,613
|
|
|
$
|
8,336
|
|
|
$
|
7,440
|
|
|
$
|
6,845
|
|
|
$
|
542
|
|
Operating income (loss)
|
1,441
|
|
|
1,803
|
|
|
1,463
|
|
|
1,220
|
|
|
930
|
|
|
(77
|
)
|
||||||
Net income (loss) attributable to VMware, Inc.(1)
|
6,412
|
|
|
1,650
|
|
|
437
|
|
|
969
|
|
|
724
|
|
|
(39
|
)
|
||||||
Net income (loss) per weighted average share attributable to VMware, Inc. common stockholders, basic, for Classes A and B
|
$
|
15.37
|
|
|
$
|
3.99
|
|
|
$
|
1.07
|
|
|
$
|
2.28
|
|
|
$
|
1.69
|
|
|
$
|
(0.09
|
)
|
Net income (loss) per weighted average share attributable to VMware, Inc. common stockholders, diluted, for Classes A and B
|
$
|
15.08
|
|
|
$
|
3.92
|
|
|
$
|
1.04
|
|
|
$
|
2.25
|
|
|
$
|
1.68
|
|
|
$
|
(0.09
|
)
|
Weighted average shares, basic, for Classes A and B
|
417,058
|
|
|
413,769
|
|
|
410,315
|
|
|
424,098
|
|
|
427,422
|
|
|
412,202
|
|
||||||
Weighted average shares, diluted, for Classes A and B
|
425,235
|
|
|
421,131
|
|
|
420,887
|
|
|
430,515
|
|
|
431,656
|
|
|
412,202
|
|
||||||
Cash Flow Data:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net cash provided by operating activities
|
$
|
3,872
|
|
|
$
|
3,657
|
|
|
$
|
3,101
|
|
|
$
|
2,244
|
|
|
$
|
1,926
|
|
|
$
|
329
|
|
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
February 3,
|
|
December 31,
|
|
December 31,
|
||||||||||||
|
2020
|
|
2019
|
|
2018(6)
|
|
2017(6)
|
|
2016
|
|
2015
|
||||||||||||
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Cash, cash equivalents and short-term investments(2)
|
$
|
2,915
|
|
|
$
|
3,551
|
|
|
$
|
11,726
|
|
|
$
|
8,527
|
|
|
$
|
8,152
|
|
|
$
|
7,583
|
|
Working capital(3)(4)
|
(3,633
|
)
|
|
513
|
|
|
9,026
|
|
|
6,021
|
|
|
6,254
|
|
|
5,197
|
|
||||||
Total assets
|
26,294
|
|
|
17,593
|
|
|
24,174
|
|
|
19,724
|
|
|
20,009
|
|
|
16,685
|
|
||||||
Total unearned revenue
|
9,268
|
|
|
7,439
|
|
|
6,127
|
|
|
5,060
|
|
|
5,318
|
|
|
4,820
|
|
||||||
Long-term obligations(5)
|
3,001
|
|
|
4,242
|
|
|
4,254
|
|
|
1,500
|
|
|
1,500
|
|
|
1,500
|
|
||||||
Total stockholders’ equity
|
7,009
|
|
|
2,891
|
|
|
11,190
|
|
|
11,624
|
|
|
11,532
|
|
|
8,657
|
|
ITEM 7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
License
|
$
|
3,181
|
|
|
$
|
3,042
|
|
|
$
|
2,628
|
|
|
$
|
139
|
|
|
5
|
%
|
|
$
|
414
|
|
|
16
|
%
|
Subscription and SaaS
|
1,877
|
|
|
1,303
|
|
|
927
|
|
|
574
|
|
|
44
|
|
|
376
|
|
|
41
|
|
|||||
Total license and subscription and SaaS
|
5,058
|
|
|
4,345
|
|
|
3,555
|
|
|
713
|
|
|
16
|
|
|
790
|
|
|
22
|
|
|||||
Services:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Software maintenance
|
4,754
|
|
|
4,351
|
|
|
3,919
|
|
|
403
|
|
|
9
|
|
|
431
|
|
|
11
|
|
|||||
Professional services
|
999
|
|
|
917
|
|
|
862
|
|
|
82
|
|
|
9
|
|
|
56
|
|
|
6
|
|
|||||
Total services
|
5,753
|
|
|
5,268
|
|
|
4,781
|
|
|
485
|
|
|
9
|
|
|
487
|
|
|
10
|
|
|||||
Total revenue
|
$
|
10,811
|
|
|
$
|
9,613
|
|
|
$
|
8,336
|
|
|
$
|
1,198
|
|
|
12
|
|
|
$
|
1,277
|
|
|
15
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
United States
|
$
|
5,405
|
|
|
$
|
4,696
|
|
|
$
|
4,200
|
|
|
$
|
709
|
|
|
15
|
%
|
|
$
|
496
|
|
|
12
|
%
|
International
|
5,406
|
|
|
4,917
|
|
|
4,136
|
|
|
489
|
|
|
10
|
|
|
781
|
|
|
19
|
|
|||||
Total revenue
|
$
|
10,811
|
|
|
$
|
9,613
|
|
|
$
|
8,336
|
|
|
$
|
1,198
|
|
|
12
|
|
|
$
|
1,277
|
|
|
15
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Unearned license revenue
|
$
|
19
|
|
|
$
|
15
|
|
Unearned subscription and SaaS revenue
|
1,534
|
|
|
916
|
|
||
Unearned software maintenance revenue
|
6,700
|
|
|
5,741
|
|
||
Unearned professional services revenue
|
1,015
|
|
|
767
|
|
||
Total unearned revenue
|
$
|
9,268
|
|
|
$
|
7,439
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Cost of license revenue
|
$
|
165
|
|
|
$
|
149
|
|
|
$
|
133
|
|
|
$
|
16
|
|
|
11
|
%
|
|
$
|
16
|
|
|
12
|
%
|
Stock-based compensation
|
1
|
|
|
1
|
|
|
2
|
|
|
—
|
|
|
45
|
|
|
(1
|
)
|
|
(50
|
)
|
|||||
Total expenses
|
$
|
166
|
|
|
$
|
150
|
|
|
$
|
135
|
|
|
$
|
16
|
|
|
11
|
|
|
$
|
15
|
|
|
11
|
|
% of License revenue
|
5
|
%
|
|
5
|
%
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Cost of subscription and SaaS revenue
|
$
|
387
|
|
|
$
|
273
|
|
|
$
|
195
|
|
|
$
|
114
|
|
|
42
|
%
|
|
$
|
78
|
|
|
40
|
%
|
Stock-based compensation
|
13
|
|
|
7
|
|
|
5
|
|
|
6
|
|
|
83
|
|
|
2
|
|
|
46
|
|
|||||
Total expenses
|
$
|
400
|
|
|
$
|
280
|
|
|
$
|
200
|
|
|
$
|
120
|
|
|
43
|
|
|
$
|
80
|
|
|
40
|
|
% of Subscription and SaaS revenue
|
21
|
%
|
|
21
|
%
|
|
22
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Cost of services revenue
|
$
|
1,150
|
|
|
$
|
1,064
|
|
|
$
|
1,019
|
|
|
$
|
86
|
|
|
8
|
%
|
|
$
|
45
|
|
|
4
|
%
|
Stock-based compensation
|
83
|
|
|
58
|
|
|
53
|
|
|
25
|
|
|
42
|
|
|
5
|
|
|
10
|
|
|||||
Total expenses
|
$
|
1,233
|
|
|
$
|
1,122
|
|
|
$
|
1,072
|
|
|
$
|
111
|
|
|
10
|
|
|
$
|
50
|
|
|
5
|
|
% of Services revenue
|
21
|
%
|
|
21
|
%
|
|
22
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Research and development
|
$
|
2,063
|
|
|
$
|
1,782
|
|
|
$
|
1,554
|
|
|
$
|
281
|
|
|
16
|
%
|
|
$
|
228
|
|
|
15
|
%
|
Stock-based compensation
|
459
|
|
|
391
|
|
|
363
|
|
|
68
|
|
|
17
|
|
|
28
|
|
|
8
|
|
|||||
Total expenses
|
$
|
2,522
|
|
|
$
|
2,173
|
|
|
$
|
1,917
|
|
|
$
|
349
|
|
|
16
|
|
|
$
|
256
|
|
|
13
|
|
% of Total revenue
|
23
|
%
|
|
23
|
%
|
|
23
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Sales and marketing
|
$
|
3,384
|
|
|
$
|
3,004
|
|
|
$
|
2,518
|
|
|
$
|
377
|
|
|
13
|
%
|
|
$
|
489
|
|
|
19
|
%
|
Stock-based compensation
|
293
|
|
|
226
|
|
|
205
|
|
|
69
|
|
|
30
|
|
|
19
|
|
|
9
|
|
|||||
Total expenses
|
$
|
3,677
|
|
|
$
|
3,230
|
|
|
$
|
2,723
|
|
|
$
|
446
|
|
|
14
|
|
|
$
|
508
|
|
|
19
|
|
% of Total revenue
|
34
|
%
|
|
34
|
%
|
|
33
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
General and administrative
|
$
|
1,125
|
|
|
$
|
729
|
|
|
$
|
638
|
|
|
$
|
396
|
|
|
54
|
%
|
|
$
|
91
|
|
|
14
|
%
|
Stock-based compensation
|
168
|
|
|
117
|
|
|
84
|
|
|
51
|
|
|
43
|
|
|
33
|
|
|
29
|
|
|||||
Total expenses
|
$
|
1,293
|
|
|
$
|
846
|
|
|
$
|
722
|
|
|
$
|
447
|
|
|
53
|
|
|
$
|
124
|
|
|
17
|
|
% of Total revenue
|
12
|
%
|
|
9
|
%
|
|
9
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Realignment and loss on disposition
|
$
|
79
|
|
|
$
|
9
|
|
|
$
|
104
|
|
|
$
|
70
|
|
|
777
|
%
|
|
$
|
(95
|
)
|
|
(91
|
)%
|
% of Total revenue
|
1
|
%
|
|
—
|
%
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Investment income
|
$
|
60
|
|
|
$
|
161
|
|
|
$
|
120
|
|
|
$
|
(101
|
)
|
|
(63
|
)%
|
|
$
|
41
|
|
|
34
|
%
|
% of Total revenue
|
1
|
%
|
|
2
|
%
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Interest expense
|
$
|
149
|
|
|
$
|
134
|
|
|
$
|
74
|
|
|
$
|
15
|
|
|
11
|
%
|
|
$
|
60
|
|
|
81
|
%
|
% of Total revenue
|
1
|
%
|
|
1
|
%
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Other income (expense), net
|
$
|
86
|
|
|
$
|
(1
|
)
|
|
$
|
68
|
|
|
$
|
87
|
|
|
(8,700
|
)%
|
|
$
|
(69
|
)
|
|
(101
|
)%
|
% of Total revenue
|
1
|
%
|
|
—
|
%
|
|
1
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
2020 vs. 2019
|
|
2019 vs. 2018
|
||||||||||||||||
|
2020
|
|
2019
|
|
2018
|
|
$ Change
|
|
% Change
|
|
$ Change
|
|
% Change
|
||||||||||||
Net loss attributable to non-controlling interests
|
$
|
56
|
|
|
$
|
60
|
|
|
$
|
12
|
|
|
$
|
4
|
|
|
6
|
%
|
|
$
|
48
|
|
|
400
|
%
|
% of Total revenue
|
1
|
%
|
|
1
|
%
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
(Amounts in table in millions)
|
2020
|
|
2019
|
|
2018
|
||||||
Income tax provision (benefit)
|
$
|
(4,918
|
)
|
|
$
|
239
|
|
|
$
|
1,152
|
|
Effective tax rate
|
N/M
|
|
|
13.1
|
%
|
|
73.1
|
%
|
|||
N/M - Effective tax rate is not considered meaningful.
|
|
|
|
|
|
•
|
Pursuant to original equipment manufacturer (“OEM”) and reseller arrangements, Dell integrates or bundles our products and services with Dell’s products and sells them to end users. Dell also acts as a distributor, purchasing our standalone products and services for resale to end-user customers through VMware-authorized resellers. Revenue under these arrangements is presented net of related marketing development funds and rebates paid to Dell. In addition, we provide professional services to end users based upon contractual agreements with Dell.
|
•
|
Dell purchases products and services from us for its internal use.
|
•
|
From time to time, we and Dell enter into agreements to collaborate on technology projects, and Dell pays us for services or reimburses us for costs incurred by us, in connection with such projects.
|
|
Revenue and Receipts
|
|
Unearned Revenue
|
||||||||||||||||
|
For the Year Ended
|
|
As of
|
||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
January 31,
|
|
February 1,
|
||||||||||
|
2020
|
|
2019
|
|
2018
|
|
2020
|
|
2019
|
||||||||||
Reseller revenue
|
$
|
3,288
|
|
|
$
|
2,355
|
|
|
$
|
1,464
|
|
|
$
|
3,787
|
|
|
$
|
2,554
|
|
Internal-use revenue
|
82
|
|
|
41
|
|
|
46
|
|
|
57
|
|
|
29
|
|
|||||
Collaborative technology project receipts
|
10
|
|
|
4
|
|
|
—
|
|
|
n/a
|
|
|
n/a
|
|
•
|
We purchase and lease products and purchase services from Dell.
|
•
|
From time to time, we and Dell enter into agreements to collaborate on technology projects, and we pay Dell for services provided to us by Dell related to such projects.
|
•
|
In certain geographic regions where we do not have an established legal entity, we contract with Dell subsidiaries for support services and support from Dell personnel who are managed by us. The costs incurred by Dell on our behalf related to these employees are charged to us with a mark-up intended to approximate costs that would have been incurred had we contracted for such services with an unrelated third party. These costs are included as expenses on our consolidated statements of income and primarily include salaries, benefits, travel and occupancy expenses. Dell also incurs certain administrative costs on our behalf in the U.S. that are recorded as expenses on our consolidated statements of income.
|
•
|
In certain geographic regions, Dell files a consolidated indirect tax return, which includes value added taxes and other indirect taxes collected by us from our customers. We remit the indirect taxes to Dell and Dell remits the tax payment to the foreign governments on our behalf.
|
•
|
From time to time, we invoice end users on behalf of Dell for certain services rendered by Dell. Cash related to these services is collected from the end user by us and remitted to Dell.
|
•
|
From time to time, we also enter into agency arrangements with Dell that enable us to sell our subscriptions and services, leveraging the Dell enterprise relationships and end customer contracts.
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Purchases and leases of products and purchases of services(1)
|
$
|
242
|
|
|
$
|
200
|
|
|
$
|
142
|
|
Dell subsidiary support and administrative costs
|
119
|
|
|
145
|
|
|
212
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Due from related parties, current
|
$
|
1,618
|
|
|
$
|
1,248
|
|
Due to related parties, current(1)
|
161
|
|
|
158
|
|
||
Due from related parties, net, current
|
$
|
1,457
|
|
|
$
|
1,090
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Cash and cash equivalents
|
$
|
2,915
|
|
|
$
|
3,532
|
|
Short-term investments
|
—
|
|
|
19
|
|
||
Total cash, cash equivalents and short-term investments
|
$
|
2,915
|
|
|
$
|
3,551
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
3,872
|
|
|
$
|
3,657
|
|
|
$
|
3,101
|
|
Investing activities
|
(2,728
|
)
|
|
4,442
|
|
|
(1,524
|
)
|
|||
Financing activities
|
(1,707
|
)
|
|
(10,580
|
)
|
|
1,129
|
|
|||
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
|
(2
|
)
|
|
1
|
|
|
(3
|
)
|
|||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
$
|
(565
|
)
|
|
$
|
(2,480
|
)
|
|
$
|
2,703
|
|
Senior Notes:
|
|
||
2.30% Senior Note Due August 21, 2020
|
$
|
1,250
|
|
2.95% Senior Note Due August 21, 2022
|
1,500
|
|
|
3.90% Senior Note Due August 21, 2027
|
1,250
|
|
|
Total principal amount
|
$
|
4,000
|
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than 5 years
|
||||||||||
Senior Notes(1)
|
$
|
4,552
|
|
|
$
|
1,372
|
|
|
$
|
1,686
|
|
|
$
|
98
|
|
|
$
|
1,396
|
|
Note payable to Dell(2)
|
283
|
|
|
5
|
|
|
278
|
|
|
—
|
|
|
—
|
|
|||||
Term Loan(3)
|
1,500
|
|
|
1,500
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Future Lease Commitments(4)
|
1,202
|
|
|
144
|
|
|
268
|
|
|
178
|
|
|
612
|
|
|||||
Purchase obligations
|
255
|
|
|
168
|
|
|
87
|
|
|
—
|
|
|
—
|
|
|||||
Tax obligations(5)
|
545
|
|
|
53
|
|
|
104
|
|
|
227
|
|
|
161
|
|
|||||
Asset Retirement Obligations
|
13
|
|
|
1
|
|
|
5
|
|
|
2
|
|
|
5
|
|
|||||
Sub-Total
|
8,350
|
|
|
3,243
|
|
|
2,428
|
|
|
505
|
|
|
2,174
|
|
|||||
Uncertain tax positions(6)
|
479
|
|
|
|
|
|
|
|
|
|
|||||||||
Total
|
$
|
8,829
|
|
|
|
|
|
|
|
|
|
(1)
|
Consists of principal and interest payments on the Senior Notes. Refer to “Liquidity and Capital Resources” for a discussion of the public debt offering we issued on August 21, 2017 in the aggregate principal amount of $4.0 billion.
|
(2)
|
Consists of principal and interest payments on the outstanding note payable to Dell. Refer to “Liquidity and Capital Resources” for a discussion of the $270 million note payable we entered into with Dell per the note exchange agreement from January 21, 2014.
|
(3)
|
Consists of the principal on the senior unsecured term loan facility (the “Term Loan”). The Term Loan can be repaid any time before October 2020. Given the variable nature of the interest on the Term Loan, including when the repayment will take place, interest payments have been excluded from the table above.
|
(4)
|
Consists of both operating and finance leases. Our operating leases are primarily for facility space and land. Amounts in the table above exclude legally binding minimum lease payments for leases signed but not yet commenced of $361 million, as well as expected sublease income.
|
(5)
|
Consists of future cash payments related to the Transition Tax.
|
(6)
|
As of January 31, 2020, we had $479 million of gross uncertain tax benefits, excluding interest and penalties. The timing of future payments relating to these obligations is highly uncertain. Based on the timing and outcome of examinations of our subsidiaries, the result of the expiration of statutes of limitations for specific jurisdictions or the timing and result of ruling requests from taxing authorities, it is reasonably possible that within the next 12 months total unrecognized tax benefits could be potentially reduced by approximately $17 million.
|
•
|
future expected cash flows from sales, maintenance agreements and acquired developed technologies;
|
•
|
the acquired company’s trade name and customer relationships as well as assumptions about the period of time the acquired trade name and customer relationships will continue to be used in the combined company’s product portfolio; and
|
•
|
discount rates used to determine the present value of estimated future cash flows.
|
ITEM 7A.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Schedule:
|
|
|
|
For the Year Ended
|
||||||||||
|
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
|
2020
|
|
2019(1)
|
|
2018(1)
|
||||||
Net income
|
|
$
|
6,356
|
|
|
$
|
1,590
|
|
|
$
|
425
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
||||||
Changes in market value of available-for-sale securities:
|
|
|
|
|
|
|
||||||
Unrealized gains (losses), net of tax provision (benefit) of $—, $— and ($5)
|
|
—
|
|
|
—
|
|
|
(12
|
)
|
|||
Reclassification of (gains) losses realized during the period, net of tax (provision) benefit of $—, $10 and $2
|
|
—
|
|
|
30
|
|
|
3
|
|
|||
Net change in market value of available-for-sale securities
|
|
—
|
|
|
30
|
|
|
(9
|
)
|
|||
Changes in market value of effective foreign currency forward contracts:
|
|
|
|
|
|
|
||||||
Unrealized gains (losses), net of tax provision (benefit) of $— for all periods
|
|
—
|
|
|
2
|
|
|
1
|
|
|||
Reclassification of (gains) losses realized during the period, net of tax (provision) benefit of $— for all periods
|
|
(2
|
)
|
|
—
|
|
|
(3
|
)
|
|||
Net change in market value of effective foreign currency forward contracts
|
|
(2
|
)
|
|
2
|
|
|
(2
|
)
|
|||
Foreign currency translation adjustments
|
|
—
|
|
|
(26
|
)
|
|
35
|
|
|||
Total other comprehensive income (loss)
|
|
(2
|
)
|
|
6
|
|
|
24
|
|
|||
Total comprehensive income, net of taxes
|
|
6,354
|
|
|
1,596
|
|
|
449
|
|
|||
Less: Net loss attributable to the non-controlling interests
|
|
(56
|
)
|
|
(60
|
)
|
|
(12
|
)
|
|||
Less: Other comprehensive income (loss) attributable to non-controlling interests
|
|
—
|
|
|
4
|
|
|
(2
|
)
|
|||
Comprehensive income attributable to VMware, Inc.
|
|
$
|
6,410
|
|
|
$
|
1,652
|
|
|
$
|
463
|
|
__________
|
|
|
|
|
|
|
||||||
(1) Adjusted to reflect the recast of prior period information due to the Pivotal acquisition, which was accounted for as a transaction between entities under common control (refer to Note B).
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019(1)
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
2,915
|
|
|
$
|
3,532
|
|
Short-term investments
|
—
|
|
|
19
|
|
||
Accounts receivable, net of allowance for doubtful accounts of $7 and $6(1)
|
1,883
|
|
|
1,723
|
|
||
Due from related parties, net
|
1,457
|
|
|
1,090
|
|
||
Other current assets
|
436
|
|
|
305
|
|
||
Total current assets
|
6,691
|
|
|
6,669
|
|
||
Property and equipment, net
|
1,280
|
|
|
1,162
|
|
||
Other assets
|
2,266
|
|
|
1,088
|
|
||
Deferred tax assets
|
5,556
|
|
|
290
|
|
||
Intangible assets, net
|
1,172
|
|
|
966
|
|
||
Goodwill
|
9,329
|
|
|
7,418
|
|
||
Total assets
|
$
|
26,294
|
|
|
$
|
17,593
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
208
|
|
|
$
|
153
|
|
Accrued expenses and other
|
2,151
|
|
|
1,664
|
|
||
Current portion of long-term debt and other borrowings
|
2,747
|
|
|
—
|
|
||
Unearned revenue
|
5,218
|
|
|
4,339
|
|
||
Total current liabilities
|
10,324
|
|
|
6,156
|
|
||
Note payable to Dell
|
270
|
|
|
270
|
|
||
Long-term debt
|
2,731
|
|
|
3,972
|
|
||
Unearned revenue
|
4,050
|
|
|
3,100
|
|
||
Income tax payable
|
817
|
|
|
889
|
|
||
Operating lease liabilities
|
746
|
|
|
—
|
|
||
Other liabilities
|
347
|
|
|
315
|
|
||
Total liabilities
|
19,285
|
|
|
14,702
|
|
||
Contingencies (refer to Note E)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Class A common stock, par value $0.01; authorized 2,500,000 shares; issued and outstanding 110,484 and 110,715 shares
|
1
|
|
|
1
|
|
||
Class B convertible common stock, par value $0.01; authorized 1,000,000 shares; issued and outstanding 307,222 and 300,000 shares
|
3
|
|
|
3
|
|
||
Additional paid-in capital
|
2,000
|
|
|
2,959
|
|
||
Accumulated other comprehensive loss
|
(4
|
)
|
|
(2
|
)
|
||
Retained earnings (Accumulated deficit)
|
5,009
|
|
|
(1,096
|
)
|
||
Total VMware, Inc. stockholders’ equity
|
7,009
|
|
|
1,865
|
|
||
Non-controlling interests
|
—
|
|
|
1,026
|
|
||
Total stockholders’ equity
|
7,009
|
|
|
2,891
|
|
||
Total liabilities and stockholders’ equity
|
$
|
26,294
|
|
|
$
|
17,593
|
|
__________
|
|
|
|
||||
(1) Adjusted to reflect the recast of prior period information due to the Pivotal acquisition, which was accounted for as a transaction between entities under common control (refer to Note B).
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019(1)
|
|
2018(1)
|
||||||
Operating activities:
|
|
|
|
|
|
||||||
Net income
|
$
|
6,356
|
|
|
$
|
1,590
|
|
|
$
|
425
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
873
|
|
|
727
|
|
|
618
|
|
|||
Stock-based compensation
|
1,017
|
|
|
800
|
|
|
712
|
|
|||
Deferred income taxes, net
|
(5,284
|
)
|
|
(110
|
)
|
|
303
|
|
|||
Unrealized (gain) loss on equity securities, net
|
(31
|
)
|
|
14
|
|
|
—
|
|
|||
Loss on disposition
|
—
|
|
|
7
|
|
|
95
|
|
|||
(Gain) loss on disposition of assets, revaluation and impairment, net
|
(4
|
)
|
|
2
|
|
|
(45
|
)
|
|||
Gain on extinguishment of debt
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||
Loss on Dell stock purchase
|
—
|
|
|
—
|
|
|
2
|
|
|||
Other
|
9
|
|
|
11
|
|
|
5
|
|
|||
Changes in assets and liabilities, net of acquisitions:
|
|
|
|
|
|
||||||
Accounts receivable
|
(119
|
)
|
|
(214
|
)
|
|
(76
|
)
|
|||
Other current assets and other assets
|
(668
|
)
|
|
(347
|
)
|
|
(455
|
)
|
|||
Due to/from related parties, net
|
(374
|
)
|
|
(480
|
)
|
|
(568
|
)
|
|||
Accounts payable
|
35
|
|
|
105
|
|
|
(22
|
)
|
|||
Accrued expenses and other liabilities
|
417
|
|
|
290
|
|
|
354
|
|
|||
Income taxes payable
|
(23
|
)
|
|
(40
|
)
|
|
660
|
|
|||
Unearned revenue
|
1,668
|
|
|
1,302
|
|
|
1,099
|
|
|||
Net cash provided by operating activities
|
3,872
|
|
|
3,657
|
|
|
3,101
|
|
|||
Investing activities:
|
|
|
|
|
|
||||||
Additions to property and equipment
|
(279
|
)
|
|
(254
|
)
|
|
(276
|
)
|
|||
Purchases of available-for-sale securities
|
—
|
|
|
(780
|
)
|
|
(4,269
|
)
|
|||
Sales of available-for-sale securities
|
—
|
|
|
3,999
|
|
|
2,195
|
|
|||
Maturities of available-for-sale securities
|
—
|
|
|
2,393
|
|
|
1,573
|
|
|||
Purchases of strategic investments
|
(30
|
)
|
|
(8
|
)
|
|
(37
|
)
|
|||
Proceeds from disposition of assets
|
22
|
|
|
41
|
|
|
13
|
|
|||
Business combinations, net of cash acquired, and purchases of intangible assets
|
(2,437
|
)
|
|
(938
|
)
|
|
(671
|
)
|
|||
Net cash paid on disposition of a business
|
(4
|
)
|
|
(11
|
)
|
|
(52
|
)
|
|||
Net cash provided by (used in) investing activities
|
(2,728
|
)
|
|
4,442
|
|
|
(1,524
|
)
|
|||
Financing activities:
|
|
|
|
|
|
||||||
Proceeds from the initial public offering of Pivotal, net of issuance costs paid
|
—
|
|
|
544
|
|
|
—
|
|
|||
Proceeds from issuance of common stock
|
308
|
|
|
259
|
|
|
131
|
|
|||
Net proceeds from issuance of long-term debt
|
—
|
|
|
—
|
|
|
3,961
|
|
|||
Borrowings under term loan, net of issuance costs
|
3,393
|
|
|
—
|
|
|
—
|
|
|||
Borrowings on credit facility, net of debt issuance costs
|
—
|
|
|
15
|
|
|
19
|
|
|||
Repayment of term loan
|
(1,900
|
)
|
|
—
|
|
|
—
|
|
|||
Repayment of notes payable to Dell
|
—
|
|
|
—
|
|
|
(1,225
|
)
|
|||
Repayments on credit facility
|
—
|
|
|
(35
|
)
|
|
—
|
|
|||
Repurchase of common stock
|
(1,334
|
)
|
|
(42
|
)
|
|
(1,449
|
)
|
|||
Shares repurchased for tax withholdings on vesting of restricted stock
|
(534
|
)
|
|
(357
|
)
|
|
(351
|
)
|
|||
Payment for Special Dividend
|
—
|
|
|
(11,000
|
)
|
|
—
|
|
|||
Payment to acquire non-controlling interests
|
(1,666
|
)
|
|
—
|
|
|
—
|
|
|||
Contribution from Dell
|
27
|
|
|
44
|
|
|
43
|
|
|||
Payment for common control transaction with Dell
|
—
|
|
|
(8
|
)
|
|
—
|
|
|||
Principal payments on finance lease obligations
|
(1
|
)
|
|
—
|
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
(1,707
|
)
|
|
(10,580
|
)
|
|
1,129
|
|
|||
Effect of exchange rate changes on cash, cash equivalents and restricted cash
|
(2
|
)
|
|
1
|
|
|
(3
|
)
|
|||
Net increase (decrease) in cash, cash equivalents and restricted cash
|
(565
|
)
|
|
(2,480
|
)
|
|
2,703
|
|
|||
Cash, cash equivalents and restricted cash at beginning of the period
|
3,596
|
|
|
6,076
|
|
|
3,373
|
|
|||
Cash, cash equivalents and restricted cash at end of the period
|
$
|
3,031
|
|
|
$
|
3,596
|
|
|
$
|
6,076
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
||||||
Issuance of VMware Class B common stock for Pivotal Class B common stock held by Dell
|
$
|
1,101
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Cash paid for interest
|
134
|
|
|
129
|
|
|
21
|
|
|||
Cash paid for taxes, net
|
369
|
|
|
399
|
|
|
178
|
|
|||
Non-cash items:
|
|
|
|
|
|
||||||
Changes in capital additions, accrued but not paid
|
$
|
18
|
|
|
$
|
9
|
|
|
$
|
10
|
|
Changes in tax withholdings on vesting of restricted stock, accrued but not paid
|
(13
|
)
|
|
17
|
|
|
(4
|
)
|
|||
__________
|
|
|
|
|
|
||||||
(1) Adjusted to reflect the recast of prior period information due to the Pivotal acquisition, which was accounted for as a transaction between entities under common control (refer to Note B).
|
|
Class A
Common Stock
|
|
Class B
Convertible
Common Stock
|
|
Additional
Paid-in
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Non-controlling Interests
|
|
Stockholders’
Equity
|
||||||||||||||||||||
Shares
|
|
Par Value
|
|
Shares
|
|
Par Value
|
|
||||||||||||||||||||||||||
Balance, February 3, 2017(1)
|
110
|
|
|
$
|
1
|
|
|
300
|
|
|
$
|
3
|
|
|
$
|
4,115
|
|
|
$
|
7,016
|
|
|
$
|
(15
|
)
|
|
$
|
505
|
|
|
$
|
11,625
|
|
Proceeds from issuance of common stock
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
122
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
122
|
|
|||||||
Issuance of stock-based awards in acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|||||||
Repurchase and retirement of common stock
|
(14
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,456
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,456
|
)
|
|||||||
Issuance of restricted stock
|
9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for tax withholdings on vesting of restricted stock
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(348
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(348
|
)
|
|||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
683
|
|
|
—
|
|
|
—
|
|
|
29
|
|
|
712
|
|
|||||||
Amount due from tax sharing arrangement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|||||||
Investment from Dell, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
72
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
77
|
|
|||||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
26
|
|
|
(2
|
)
|
|
24
|
|
|||||||
Transactions with Pivotal’s non-controlling stockholders
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
26
|
|
|
9
|
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
437
|
|
|
—
|
|
|
(12
|
)
|
|
425
|
|
|||||||
Balance, February 2, 2018(1)
|
104
|
|
|
1
|
|
|
300
|
|
|
3
|
|
|
3,171
|
|
|
7,453
|
|
|
11
|
|
|
551
|
|
|
11,190
|
|
|||||||
Cumulative effect of adoption of new accounting pronouncements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
|
(15
|
)
|
|
—
|
|
|
(30
|
)
|
|||||||
Proceeds from issuance of common stock
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
188
|
|
|||||||
Issuance of stock-based awards in acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||||
Repurchase and retirement of common stock
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42
|
)
|
|||||||
Issuance of restricted stock
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for tax withholdings on vesting of restricted stock
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(373
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(373
|
)
|
|||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
731
|
|
|
—
|
|
|
—
|
|
|
69
|
|
|
800
|
|
|||||||
Credit from tax sharing arrangement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|||||||
Investment from Dell, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(53
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
(52
|
)
|
|||||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
4
|
|
|
6
|
|
|||||||
Transactions with Pivotal’s non-controlling stockholders
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
154
|
|
|
—
|
|
|
—
|
|
|
461
|
|
|
615
|
|
|||||||
Common control transaction with Dell
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|
—
|
|
|
—
|
|
|
(6
|
)
|
|||||||
Special Dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(822
|
)
|
|
(10,178
|
)
|
|
—
|
|
|
—
|
|
|
(11,000
|
)
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,650
|
|
|
—
|
|
|
(60
|
)
|
|
1,590
|
|
|||||||
Balance, February 1, 2019(1)
|
111
|
|
|
1
|
|
|
300
|
|
|
3
|
|
|
2,959
|
|
|
(1,096
|
)
|
|
(2
|
)
|
|
1,026
|
|
|
2,891
|
|
|||||||
Cumulative effect of adoption of new accounting pronouncements
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|||||||
Proceeds from issuance of common stock
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
203
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
203
|
|
|||||||
Issuance of stock-based awards in acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|||||||
Repurchase and retirement of common stock
|
(8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,024
|
)
|
|
(310
|
)
|
|
—
|
|
|
—
|
|
|
(1,334
|
)
|
|||||||
Issuance of restricted stock
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Shares withheld for tax withholdings on vesting of restricted stock
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(521
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(521
|
)
|
|||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
921
|
|
|
—
|
|
|
—
|
|
|
96
|
|
|
1,017
|
|
|||||||
Credit from tax sharing arrangement
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
85
|
|
|||||||
Investment from Dell, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
13
|
|
|
—
|
|
|
—
|
|
|
9
|
|
|
22
|
|
|||||||
Total other comprehensive income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|||||||
Transactions with Pivotal’s non-controlling stockholders
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(649
|
)
|
|
—
|
|
|
—
|
|
|
(1,075
|
)
|
|
(1,724
|
)
|
|||||||
Issuance of VMware’s Class B common stock issued to Dell
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,412
|
|
|
—
|
|
|
(56
|
)
|
|
6,356
|
|
|||||||
Balance, January 31, 2020
|
110
|
|
|
$
|
1
|
|
|
307
|
|
|
$
|
3
|
|
|
$
|
2,000
|
|
|
$
|
5,009
|
|
|
$
|
(4
|
)
|
|
$
|
—
|
|
|
$
|
7,009
|
|
__________
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
(1) Adjusted to reflect the retrospective combination of VMware and Pivotal, as if the combination had been in effect since the inception of common control (refer to Note B).
|
|
For the Year Ended
|
||||||||||||||
|
February 1, 2019
|
||||||||||||||
|
As Previously Reported
|
|
Reclassification For New Revenue Line
|
|
Pivotal Adjustments(1)
|
|
As Adjusted
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
License
|
$
|
3,788
|
|
|
$
|
(745
|
)
|
|
$
|
(1
|
)
|
|
$
|
3,042
|
|
Subscription and SaaS
|
—
|
|
|
924
|
|
|
379
|
|
|
1,303
|
|
||||
Services
|
5,186
|
|
|
(179
|
)
|
|
261
|
|
|
5,268
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of license revenue
|
191
|
|
|
(41
|
)
|
|
—
|
|
|
150
|
|
||||
Cost of subscription and SaaS revenue
|
—
|
|
|
198
|
|
|
82
|
|
|
280
|
|
||||
Cost of services revenue
|
1,067
|
|
|
(157
|
)
|
|
212
|
|
|
1,122
|
|
|
For the Year Ended
|
||||||||||||||
|
February 2, 2018
|
||||||||||||||
|
As Previously Reported
|
|
Reclassification For New Revenue Line
|
|
Pivotal Adjustments(1)
|
|
As Adjusted
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
License
|
$
|
3,200
|
|
|
$
|
(578
|
)
|
|
$
|
6
|
|
|
$
|
2,628
|
|
Subscription and SaaS
|
—
|
|
|
708
|
|
|
219
|
|
|
927
|
|
||||
Services
|
4,662
|
|
|
(130
|
)
|
|
249
|
|
|
4,781
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Cost of license revenue
|
157
|
|
|
(22
|
)
|
|
—
|
|
|
135
|
|
||||
Cost of subscription and SaaS revenue
|
—
|
|
|
134
|
|
|
66
|
|
|
200
|
|
||||
Cost of services revenue
|
984
|
|
|
(112
|
)
|
|
200
|
|
|
1,072
|
|
Buildings
|
|
Term of underlying land lease
|
Land improvements
|
|
15 years
|
Furniture and fixtures
|
|
5 to 10 years
|
Equipment
|
|
3 to 6 years
|
Software
|
|
3 to 8 years
|
Leasehold improvements
|
|
20 years, not to exceed the shorter of the estimated useful life or remaining lease term
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Total revenue
|
$
|
777
|
|
|
$
|
639
|
|
|
$
|
474
|
|
Operating income
|
(287
|
)
|
|
(247
|
)
|
|
(239
|
)
|
|||
Net income
|
(204
|
)
|
|
(832
|
)
|
|
(234
|
)
|
|||
Net income attributable to VMware
|
(148
|
)
|
|
(772
|
)
|
|
(222
|
)
|
|||
Net income per weighted-average share attributable to VMware common stockholders, basic for Classes A and B
|
$
|
(0.63
|
)
|
|
$
|
(1.95
|
)
|
|
$
|
(0.56
|
)
|
Net income per weighted-average share attributable to VMware common stockholders, diluted for Classes A and B
|
$
|
(0.67
|
)
|
|
$
|
(1.93
|
)
|
|
$
|
(0.56
|
)
|
Other comprehensive income (loss)
|
$
|
—
|
|
|
$
|
(26
|
)
|
|
$
|
35
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Unearned license revenue
|
$
|
19
|
|
|
$
|
15
|
|
Unearned subscription and SaaS revenue
|
1,534
|
|
|
916
|
|
||
Unearned software maintenance revenue
|
6,700
|
|
|
5,741
|
|
||
Unearned professional services revenue
|
1,015
|
|
|
767
|
|
||
Total unearned revenue
|
$
|
9,268
|
|
|
$
|
7,439
|
|
•
|
Pursuant to OEM and reseller arrangements, Dell integrates or bundles VMware’s products and services with Dell’s products and sells them to end users. Dell also acts as a distributor, purchasing VMware’s standalone products and services for resale to end-user customers through VMware-authorized resellers. Revenue under these arrangements is presented net of related marketing development funds and rebates paid to Dell. In addition, VMware provides professional services to end users based upon contractual agreements with Dell.
|
•
|
Dell purchases products and services from VMware for its internal use.
|
•
|
From time to time, VMware and Dell enter into agreements to collaborate on technology projects, and Dell pays VMware for services or reimburses VMware for costs incurred by VMware, in connection with such projects.
|
|
Revenue and Receipts
|
|
Unearned Revenue
|
||||||||||||||||
|
For the Year Ended
|
|
As of
|
||||||||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|
January 31,
|
|
February 1,
|
||||||||||
|
2020
|
|
2019
|
|
2018
|
|
2020
|
|
2019
|
||||||||||
Reseller revenue
|
$
|
3,288
|
|
|
$
|
2,355
|
|
|
$
|
1,464
|
|
|
$
|
3,787
|
|
|
$
|
2,554
|
|
Internal-use revenue
|
82
|
|
|
41
|
|
|
46
|
|
|
57
|
|
|
29
|
|
|||||
Collaborative technology project receipts
|
10
|
|
|
4
|
|
|
—
|
|
|
n/a
|
|
|
n/a
|
|
•
|
VMware purchases and leases products and purchases services from Dell.
|
•
|
From time to time, VMware and Dell enter into agreements to collaborate on technology projects, and VMware pays Dell for services provided to VMware by Dell related to such projects.
|
•
|
In certain geographic regions where VMware does not have an established legal entity, VMware contracts with Dell subsidiaries for support services and support from Dell personnel who are managed by VMware. The costs incurred by Dell on VMware’s behalf related to these employees are charged to VMware with a mark-up intended to approximate costs that would have been incurred had VMware contracted for such services with an unrelated third party. These costs are included as expenses on VMware’s consolidated statements of income and primarily include salaries, benefits, travel and occupancy expenses. Dell also incurs certain administrative costs on VMware’s behalf in the U.S. that are recorded as expenses on VMware’s consolidated statements of income.
|
•
|
In certain geographic regions, Dell files a consolidated indirect tax return, which includes value added taxes and other indirect taxes collected by VMware from its customers. VMware remits the indirect taxes to Dell and Dell remits the tax payment to the foreign governments on VMware’s behalf.
|
•
|
From time to time, VMware invoices end users on behalf of Dell for certain services rendered by Dell. Cash related to these services is collected from the end user by VMware and remitted to Dell.
|
•
|
From time to time, VMware also enters into agency arrangements with Dell that enable VMware to sell its subscriptions and services, leveraging the Dell enterprise relationships and end customer contracts.
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Purchases and leases of products and purchases of services(1)
|
$
|
242
|
|
|
$
|
200
|
|
|
$
|
142
|
|
Dell subsidiary support and administrative costs
|
119
|
|
|
145
|
|
|
212
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Due from related parties, current
|
$
|
1,618
|
|
|
$
|
1,248
|
|
Due to related parties, current(1)
|
161
|
|
|
158
|
|
||
Due from related parties, net, current
|
$
|
1,457
|
|
|
$
|
1,090
|
|
|
Future Lease Commitments(1)
|
|
Purchase Obligations
|
|
Asset Retirement Obligations
|
|
Total
|
||||||||
2021
|
$
|
144
|
|
|
$
|
168
|
|
|
$
|
1
|
|
|
$
|
313
|
|
2022
|
141
|
|
|
74
|
|
|
3
|
|
|
218
|
|
||||
2023
|
127
|
|
|
13
|
|
|
2
|
|
|
142
|
|
||||
2024
|
101
|
|
|
—
|
|
|
—
|
|
|
101
|
|
||||
2025
|
77
|
|
|
—
|
|
|
2
|
|
|
79
|
|
||||
Thereafter
|
612
|
|
|
—
|
|
|
5
|
|
|
617
|
|
||||
Total
|
$
|
1,202
|
|
|
$
|
255
|
|
|
$
|
13
|
|
|
$
|
1,470
|
|
(1)
|
Amounts in the table above exclude legally binding minimum lease payments for leases signed but not yet commenced of $361 million, as well as expected sublease income.
|
Cash
|
$
|
111
|
|
Accounts receivable
|
58
|
|
|
Intangible assets
|
492
|
|
|
Goodwill
|
1,588
|
|
|
Other acquired assets
|
52
|
|
|
Total assets acquired
|
2,301
|
|
|
Unearned revenue
|
151
|
|
|
Other assumed liabilities
|
45
|
|
|
Total liabilities assumed
|
196
|
|
|
Fair value of assets acquired and liabilities assumed
|
$
|
2,105
|
|
|
Weighted-Average Useful Lives
(in years) |
|
Fair Value Amount
|
||
Purchased technology
|
4.2
|
|
$
|
232
|
|
Customer relationships and customer lists
|
7.0
|
|
215
|
|
|
Trademarks and tradenames
|
5.0
|
|
25
|
|
|
Other
|
2.0
|
|
20
|
|
|
Total definite-lived intangible assets
|
|
|
$
|
492
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Balance, beginning of the year
|
$
|
966
|
|
|
$
|
1,059
|
|
Additions to intangible assets related to business combinations
|
622
|
|
|
154
|
|
||
Amortization expense
|
(300
|
)
|
|
(247
|
)
|
||
Derecognized leasehold interest
|
(116
|
)
|
|
—
|
|
||
Balance, end of the year
|
$
|
1,172
|
|
|
$
|
966
|
|
|
January 31, 2020
|
||||||||||||
|
Weighted-Average Useful Lives
(in years) |
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Book Value
|
||||||
Purchased technology
|
5.7
|
|
$
|
1,030
|
|
|
$
|
(488
|
)
|
|
$
|
542
|
|
Customer relationships and customer lists
|
11.4
|
|
739
|
|
|
(200
|
)
|
|
539
|
|
|||
Trademarks and tradenames
|
7.6
|
|
131
|
|
|
(58
|
)
|
|
73
|
|
|||
Other
|
2.0
|
|
22
|
|
|
(4
|
)
|
|
18
|
|
|||
Total definite-lived intangible assets
|
|
|
$
|
1,922
|
|
|
$
|
(750
|
)
|
|
$
|
1,172
|
|
|
February 1, 2019
|
||||||||||||
|
Weighted-Average Useful Lives
(in years) |
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Book Value
|
||||||
Purchased technology
|
6.4
|
|
$
|
1,001
|
|
|
$
|
(606
|
)
|
|
$
|
395
|
|
Leasehold interest
|
34.9
|
|
149
|
|
|
(33
|
)
|
|
116
|
|
|||
Customer relationships and customer lists
|
13.6
|
|
513
|
|
|
(125
|
)
|
|
388
|
|
|||
Trademarks and tradenames
|
8.3
|
|
106
|
|
|
(43
|
)
|
|
63
|
|
|||
Other
|
3.9
|
|
7
|
|
|
(3
|
)
|
|
4
|
|
|||
Total definite-lived intangible assets
|
|
|
$
|
1,776
|
|
|
$
|
(810
|
)
|
|
$
|
966
|
|
2021
|
$
|
305
|
|
2022
|
261
|
|
|
2023
|
211
|
|
|
2024
|
165
|
|
|
2025
|
91
|
|
|
Thereafter
|
139
|
|
|
Total
|
$
|
1,172
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Balance, beginning of the year
|
$
|
7,418
|
|
|
$
|
6,660
|
|
Increase in goodwill related to business combinations
|
1,911
|
|
|
784
|
|
||
Other adjustment
|
—
|
|
|
(26
|
)
|
||
Balance, end of the year
|
$
|
9,329
|
|
|
$
|
7,418
|
|
|
For the Year Ended January 31, 2020
|
||||||||||||||
|
Balance as of
February 1, 2019
|
|
Realignment
|
|
Utilization
|
|
Balance as of
January 31, 2020
|
||||||||
Severance-related costs
|
$
|
—
|
|
|
$
|
79
|
|
|
$
|
(5
|
)
|
|
$
|
74
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Net income attributable to VMware, Inc.
|
$
|
6,412
|
|
|
$
|
1,650
|
|
|
$
|
437
|
|
|
|
|
|
|
|
||||||
Weighted-average shares, basic for Classes A and B
|
417,058
|
|
|
413,769
|
|
|
410,315
|
|
|||
Effect of other dilutive securities
|
8,177
|
|
|
7,362
|
|
|
10,572
|
|
|||
Weighted-average shares, diluted for Classes A and B
|
425,235
|
|
|
421,131
|
|
|
420,887
|
|
|||
Net income per weighted-average share attributable to VMware, Inc. common stockholders, basic for Classes A and B
|
$
|
15.37
|
|
|
$
|
3.99
|
|
|
$
|
1.07
|
|
Net income per weighted-average share attributable to VMware, Inc. common stockholders, diluted for Classes A and B
|
$
|
15.08
|
|
|
$
|
3.92
|
|
|
$
|
1.04
|
|
|
For the Year Ended
|
|||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|||
|
2020
|
|
2019
|
|
2018
|
|||
Anti-dilutive securities:
|
|
|
|
|
|
|||
Employee stock options
|
34
|
|
|
50
|
|
|
51
|
|
Restricted stock units
|
315
|
|
|
255
|
|
|
140
|
|
Total
|
349
|
|
|
305
|
|
|
191
|
|
|
January 31, 2020
|
||||||||||||||
|
Cost or Amortized Cost
|
|
Unrealized Gains
|
|
Unrealized Losses
|
|
Aggregate Fair Value
|
||||||||
Cash
|
$
|
655
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
655
|
|
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money-market funds
|
$
|
2,158
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,158
|
|
Demand deposits and time deposits
|
102
|
|
|
—
|
|
|
—
|
|
|
102
|
|
||||
Total cash equivalents
|
$
|
2,260
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,260
|
|
|
February 1, 2019
|
||||||||||||||
|
Cost or Amortized Cost
|
|
Unrealized Gains
|
|
Unrealized Losses
|
|
Aggregate Fair Value
|
||||||||
Cash
|
$
|
549
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
549
|
|
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money-market funds
|
$
|
2,930
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,930
|
|
Demand deposits and time deposits
|
53
|
|
|
—
|
|
|
—
|
|
|
53
|
|
||||
Total cash equivalents
|
$
|
2,983
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,983
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Cash and cash equivalents
|
$
|
2,915
|
|
|
$
|
3,532
|
|
Restricted cash within other current assets
|
83
|
|
|
35
|
|
||
Restricted cash within other assets
|
33
|
|
|
29
|
|
||
Total cash, cash equivalents and restricted cash
|
$
|
3,031
|
|
|
$
|
3,596
|
|
|
January 31,
|
|
February 1,
|
|
Effective Interest Rate
|
||||
|
2020
|
|
2019
|
|
|||||
Senior Notes:
|
|
|
|
|
|
||||
2.30% Senior Note Due August 21, 2020
|
$
|
1,250
|
|
|
$
|
1,250
|
|
|
2.56%
|
2.95% Senior Note Due August 21, 2022
|
1,500
|
|
|
1,500
|
|
|
3.17%
|
||
3.90% Senior Note Due August 21, 2027
|
1,250
|
|
|
1,250
|
|
|
4.05%
|
||
Total principal amount
|
4,000
|
|
|
4,000
|
|
|
|
||
Less: unamortized discount
|
(5
|
)
|
|
(7
|
)
|
|
|
||
Less: unamortized debt issuance costs
|
(16
|
)
|
|
(21
|
)
|
|
|
||
Net carrying amount
|
3,979
|
|
|
3,972
|
|
|
|
||
Current portion of long-term debt and other borrowings
|
1,248
|
|
|
—
|
|
|
|
||
Long-term debt
|
$
|
2,731
|
|
|
$
|
3,972
|
|
|
|
•
|
Level 1 - Quoted prices in active markets for identical assets or liabilities;
|
•
|
Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are noted as being active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and
|
•
|
Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.
|
|
January 31, 2020
|
||||||||||
|
Level 1
|
|
Level 2
|
|
Total
|
||||||
Cash equivalents:
|
|
|
|
|
|
|
|||||
Money-market funds
|
$
|
2,158
|
|
|
$
|
—
|
|
|
$
|
2,158
|
|
Demand deposits and time deposits(1)
|
—
|
|
|
102
|
|
|
102
|
|
|||
Total cash equivalents
|
$
|
2,158
|
|
|
$
|
102
|
|
|
$
|
2,260
|
|
|
February 1, 2019
|
||||||||||
|
Level 1
|
|
Level 2
|
|
Total
|
||||||
Cash equivalents:
|
|
|
|
|
|
||||||
Money-market funds
|
$
|
2,930
|
|
|
$
|
—
|
|
|
$
|
2,930
|
|
Demand deposits and time deposits(1)
|
—
|
|
|
53
|
|
|
53
|
|
|||
Total cash equivalents
|
$
|
2,930
|
|
|
$
|
53
|
|
|
$
|
2,983
|
|
Short-term investments:
|
|
|
|
|
|
||||||
Marketable equity securities
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
19
|
|
Total short-term investments
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
19
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Equipment and software
|
$
|
1,404
|
|
|
$
|
1,448
|
|
Buildings and improvements
|
1,088
|
|
|
991
|
|
||
Furniture and fixtures
|
120
|
|
|
116
|
|
||
Construction in progress
|
106
|
|
|
56
|
|
||
Total property and equipment
|
2,718
|
|
|
2,611
|
|
||
Accumulated depreciation
|
(1,438
|
)
|
|
(1,449
|
)
|
||
Total property and equipment, net
|
$
|
1,280
|
|
|
$
|
1,162
|
|
|
For the Year Ended
|
||
|
January 31,
|
||
|
2020
|
||
Operating lease expense
|
$
|
167
|
|
|
|
||
Finance lease expense:
|
|
||
Amortization of ROU assets
|
$
|
4
|
|
Interest on lease liabilities
|
1
|
|
|
Total finance lease expense
|
$
|
5
|
|
|
|
||
Short-term lease expense
|
$
|
3
|
|
|
|
||
Variable lease expense
|
$
|
31
|
|
Total lease expense
|
$
|
206
|
|
|
January 31, 2020
|
||||||
|
Operating Leases
|
|
Finance Leases
|
||||
ROU assets, non-current(1)
|
$
|
886
|
|
|
$
|
58
|
|
|
|
|
|
||||
Lease liabilities, current(2)
|
$
|
109
|
|
|
$
|
4
|
|
Lease liabilities, non-current(3)
|
746
|
|
|
55
|
|
||
Total lease liabilities
|
$
|
855
|
|
|
$
|
59
|
|
|
January 31,
|
|
|
2020
|
|
Weighted-average remaining lease term (in years)
|
|
|
Operating leases
|
13.3
|
|
Finance leases
|
9.2
|
|
Weighted-average discount rate
|
|
|
Operating leases
|
3.8
|
%
|
Finance leases
|
3.1
|
%
|
|
Operating Leases
|
|
Finance Leases
|
||||
2021
|
$
|
138
|
|
|
$
|
6
|
|
2022
|
135
|
|
|
6
|
|
||
2023
|
120
|
|
|
7
|
|
||
2024
|
94
|
|
|
7
|
|
||
2025
|
70
|
|
|
7
|
|
||
Thereafter
|
577
|
|
|
35
|
|
||
Total future minimum lease payments
|
1,134
|
|
|
68
|
|
||
Less: Imputed interest
|
(279
|
)
|
|
(9
|
)
|
||
Total lease liabilities(1)
|
$
|
855
|
|
|
$
|
59
|
|
2020
|
$
|
132
|
|
2021
|
104
|
|
|
2022
|
91
|
|
|
2023
|
78
|
|
|
2024
|
63
|
|
|
Thereafter
|
585
|
|
|
Total(1)
|
$
|
1,053
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Accrued employee related expenses
|
$
|
845
|
|
|
$
|
780
|
|
Accrued partner liabilities
|
181
|
|
|
207
|
|
||
Customer deposits
|
247
|
|
|
239
|
|
||
Other(1)
|
878
|
|
|
438
|
|
||
Total
|
$
|
2,151
|
|
|
$
|
1,664
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Domestic
|
$
|
895
|
|
|
$
|
680
|
|
|
$
|
462
|
|
Foreign
|
543
|
|
|
1,149
|
|
|
1,115
|
|
|||
Total income before income tax
|
$
|
1,438
|
|
|
$
|
1,829
|
|
|
$
|
1,577
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Federal:
|
|
|
|
|
|
||||||
Current
|
$
|
78
|
|
|
$
|
181
|
|
|
$
|
688
|
|
Deferred
|
(219
|
)
|
|
(92
|
)
|
|
275
|
|
|||
|
(141
|
)
|
|
89
|
|
|
963
|
|
|||
State:
|
|
|
|
|
|
||||||
Current
|
45
|
|
|
31
|
|
|
8
|
|
|||
Deferred
|
(44
|
)
|
|
(10
|
)
|
|
21
|
|
|||
|
1
|
|
|
21
|
|
|
29
|
|
|||
Foreign:
|
|
|
|
|
|
||||||
Current
|
240
|
|
|
137
|
|
|
156
|
|
|||
Deferred
|
(5,018
|
)
|
|
(8
|
)
|
|
4
|
|
|||
|
(4,778
|
)
|
|
129
|
|
|
160
|
|
|||
Total income tax provision (benefit)
|
$
|
(4,918
|
)
|
|
$
|
239
|
|
|
$
|
1,152
|
|
|
For the Year Ended
|
|||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
|||
|
2020
|
|
2019
|
|
2018
|
|||
Statutory federal tax rate(1)
|
21
|
%
|
|
21
|
%
|
|
34
|
%
|
State taxes, net of federal benefit
|
—
|
%
|
|
1
|
%
|
|
1
|
%
|
Tax rate differential for non-U.S. jurisdictions
|
(3
|
)%
|
|
(6
|
)%
|
|
(14
|
)%
|
U.S. tax credits
|
(17
|
)%
|
|
(11
|
)%
|
|
(5
|
)%
|
Excess tax benefits from stock-based compensation(2)
|
(11
|
)%
|
|
(6
|
)%
|
|
(7
|
)%
|
Transition Tax due to 2017 Tax Act(3)
|
—
|
%
|
|
—
|
%
|
|
50
|
%
|
Rate change due to 2017 Tax Act(3)
|
—
|
%
|
|
—
|
%
|
|
10
|
%
|
Discrete tax benefit due to IP Transfer(4)
|
(343
|
)%
|
|
—
|
%
|
|
—
|
%
|
Permanent items
|
9
|
%
|
|
14
|
%
|
|
4
|
%
|
Effective tax rate
|
(344
|
)%
|
|
13
|
%
|
|
73
|
%
|
(2)
|
VMware adopted ASU 2016-09 during the first quarter of fiscal 2018. As a result, net excess tax benefits recognized in connection with stock-based awards are included in the income tax provision on the consolidated statements of income. Prior to adopting the updated standard, such amounts were recognized in additional paid-in capital on the Company’s consolidated balance sheets.
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
Deferred tax assets:
|
|
|
|
||||
Accruals and other
|
$
|
169
|
|
|
$
|
79
|
|
Lease liabilities
|
152
|
|
|
—
|
|
||
Unearned revenue
|
390
|
|
|
295
|
|
||
Stock-based compensation
|
88
|
|
|
83
|
|
||
Tax credit and net operating loss carryforwards
|
583
|
|
|
349
|
|
||
Other assets, net
|
51
|
|
|
32
|
|
||
Intangible and other non-current assets
|
4,804
|
|
|
—
|
|
||
Gross deferred tax assets
|
6,237
|
|
|
838
|
|
||
Valuation allowance
|
(332
|
)
|
|
(283
|
)
|
||
Total deferred tax assets
|
5,905
|
|
|
555
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Deferred commissions
|
(133
|
)
|
|
(129
|
)
|
||
ROU Assets
|
(131
|
)
|
|
—
|
|
||
Property, plant and equipment, net
|
(101
|
)
|
|
(90
|
)
|
||
Intangibles and other assets, net
|
—
|
|
|
(108
|
)
|
||
Total deferred tax liabilities
|
(365
|
)
|
|
(327
|
)
|
||
Net deferred tax assets
|
$
|
5,540
|
|
|
$
|
228
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Payments from VMware to Dell, net
|
$
|
159
|
|
|
$
|
243
|
|
|
$
|
54
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Balance, beginning of the year
|
$
|
385
|
|
|
$
|
305
|
|
|
$
|
265
|
|
Tax positions related to current year:
|
|
|
|
|
|
||||||
Additions
|
116
|
|
|
57
|
|
|
63
|
|
|||
Tax positions related to prior years:
|
|
|
|
|
|
||||||
Additions
|
98
|
|
|
44
|
|
|
2
|
|
|||
Reductions
|
(7
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|||
Settlements
|
(28
|
)
|
|
(4
|
)
|
|
(9
|
)
|
|||
Reductions resulting from a lapse of the statute of limitations
|
(83
|
)
|
|
(8
|
)
|
|
(24
|
)
|
|||
Foreign currency effects
|
(2
|
)
|
|
(8
|
)
|
|
10
|
|
|||
Balance, end of the year
|
$
|
479
|
|
|
$
|
385
|
|
|
$
|
305
|
|
Announcement Date
|
|
Amount Authorized
|
|
Expiration Date
|
|
Status
|
May 29, 2019
|
|
$1,500
|
|
January 29, 2021
|
|
Open
|
August 14, 2017
|
|
1,000
|
|
August 31, 2019
|
|
Completed in fiscal 2020
|
January 26, 2017
|
|
1,200
|
|
February 2, 2018
|
|
Completed in fiscal 2018
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Aggregate purchase price(1)
|
$
|
1,334
|
|
|
$
|
42
|
|
|
$
|
1,449
|
|
Class A common stock repurchased
|
7,664
|
|
|
286
|
|
|
13,977
|
|
|||
Weighted-average price per share
|
$
|
174.02
|
|
|
$
|
148.07
|
|
|
$
|
103.66
|
|
|
VMware RSUs
|
|
Pivotal RSUs
|
||||||||||
|
Number of Units
|
|
Weighted-Average Grant Date Fair Value
(per unit)
|
|
Number of Units
|
|
Weighted-Average Grant Date Fair Value
(per unit)
|
||||||
Outstanding, February 3, 2017
|
20,451
|
|
|
$
|
67.41
|
|
|
—
|
|
|
$
|
—
|
|
Granted
|
7,838
|
|
|
93.84
|
|
|
—
|
|
|
—
|
|
||
Vested
|
(9,070
|
)
|
|
67.89
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
(1,859
|
)
|
|
72.68
|
|
|
—
|
|
|
—
|
|
||
Outstanding, February 2, 2018
|
17,360
|
|
|
78.62
|
|
|
—
|
|
|
—
|
|
||
Granted
|
6,663
|
|
|
146.61
|
|
|
9,854
|
|
|
15.78
|
|
||
Special Dividend adjustment
|
3,236
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
||
Vested
|
(7,370
|
)
|
|
75.45
|
|
|
—
|
|
|
—
|
|
||
Forfeited
|
(1,674
|
)
|
|
86.90
|
|
|
(353
|
)
|
|
16.09
|
|
||
Outstanding, February 1, 2019(1)
|
18,215
|
|
|
90.06
|
|
|
9,501
|
|
|
15.77
|
|
||
Granted(2)
|
9,074
|
|
|
157.07
|
|
|
20,504
|
|
|
16.02
|
|
||
Vested
|
(8,179
|
)
|
|
80.28
|
|
|
(4,009
|
)
|
|
15.56
|
|
||
Forfeited(3)
|
(1,636
|
)
|
|
101.29
|
|
|
(25,996
|
)
|
|
16.01
|
|
||
Outstanding, January 31, 2020
|
17,474
|
|
|
128.38
|
|
|
—
|
|
|
—
|
|
(1)
|
The weighted-average grant date fair value of outstanding RSU awards as of February 1, 2019 reflects the adjustments to the awards as a result of the Special Dividend.
|
|
Number of Units
|
|
Weighted-Average Remaining Contractual Term
(in years)
|
|
Aggregate Intrinsic Value(1)
|
|||
Expected to vest
|
15,670
|
|
|
2.39
|
|
$
|
2,320
|
|
(1)
|
The aggregate intrinsic value represents the total pre-tax intrinsic values based on VMware's closing stock price of 148.06 as of January 31, 2020, which would have been received by the RSU holders had the RSUs been issued as of January 31, 2020.
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Cash proceeds
|
$
|
172
|
|
|
$
|
161
|
|
|
$
|
65
|
|
Class A common stock purchased
|
1,489
|
|
|
1,895
|
|
|
903
|
|
|||
Weighted-average price per share
|
$
|
115.51
|
|
|
$
|
84.95
|
|
|
$
|
72.40
|
|
|
VMware Stock Options
|
|
Pivotal Stock Options
|
||||||||||
|
Number of Shares
|
|
Weighted-Average Exercise Price
(per share)
|
|
Number of Shares
|
|
Weighted-Average Exercise Price
(per share)
|
||||||
Outstanding, February 3, 2017
|
1,991
|
|
|
$
|
69.38
|
|
|
39,361
|
|
|
$
|
6.72
|
|
Granted
|
745
|
|
|
13.79
|
|
|
20,323
|
|
|
9.73
|
|
||
Forfeited
|
(36
|
)
|
|
55.44
|
|
|
(2,380
|
)
|
|
8.13
|
|
||
Expired
|
(3
|
)
|
|
93.87
|
|
|
(1,290
|
)
|
|
6.24
|
|
||
Exercised
|
(1,050
|
)
|
|
53.50
|
|
|
(1,626
|
)
|
|
5.99
|
|
||
Outstanding, February 2, 2018
|
1,647
|
|
|
54.63
|
|
|
54,388
|
|
|
7.82
|
|
||
Granted
|
574
|
|
|
16.07
|
|
|
2,832
|
|
|
14.03
|
|
||
Special Dividend adjustment
|
348
|
|
|
n/a
|
|
|
n/a
|
|
|
n/a
|
|
||
Forfeited
|
(31
|
)
|
|
24.44
|
|
|
(2,028
|
)
|
|
9.35
|
|
||
Expired
|
—
|
|
|
—
|
|
|
(273
|
)
|
|
7.02
|
|
||
Exercised
|
(569
|
)
|
|
46.73
|
|
|
(9,018
|
)
|
|
6.89
|
|
||
Outstanding, February 1, 2019(1)
|
1,969
|
|
|
36.50
|
|
|
45,901
|
|
|
8.31
|
|
||
Granted(2)
|
1,571
|
|
|
73.19
|
|
|
—
|
|
|
—
|
|
||
Forfeited(3)
|
(149
|
)
|
|
52.83
|
|
|
(10,822
|
)
|
|
10.65
|
|
||
Expired
|
—
|
|
|
—
|
|
|
(128
|
)
|
|
10.10
|
|
||
Exercised(4)
|
(776
|
)
|
|
39.94
|
|
|
(34,951
|
)
|
|
7.59
|
|
||
Outstanding, January 31, 2020
|
2,615
|
|
|
56.58
|
|
|
—
|
|
|
—
|
|
(1)
|
The weighted-average exercise price of options outstanding as of February 1, 2019 reflects the adjustments to the options as a result of the Special Dividend.
|
|
VMware Stock Options
|
|||||||||||
|
Outstanding Options
|
|
Weighted- Average Exercise Price
|
|
Weighted- Average Remaining Contractual Term
(in years)
|
|
Aggregate Intrinsic Value(1)
|
|||||
Exercisable
|
945
|
|
|
$
|
47.24
|
|
|
3.81
|
|
$
|
95
|
|
Vested and expected to vest
|
2,589
|
|
|
56.13
|
|
|
6.41
|
|
238
|
|
(1)
|
The aggregate intrinsic values represent the total pre-tax intrinsic values based on VMware's closing stock price of $148.06 as of January 31, 2020, which would have been received by the option holders had all in-the-money options been exercised as of that date.
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Cost of license revenue
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
2
|
|
Cost of subscription and SaaS revenue
|
13
|
|
|
7
|
|
|
5
|
|
|||
Cost of services revenue
|
83
|
|
|
58
|
|
|
53
|
|
|||
Research and development
|
459
|
|
|
391
|
|
|
363
|
|
|||
Sales and marketing
|
293
|
|
|
226
|
|
|
205
|
|
|||
General and administrative
|
168
|
|
|
117
|
|
|
84
|
|
|||
Stock-based compensation
|
1,017
|
|
|
800
|
|
|
712
|
|
|||
Income tax benefit
|
(347
|
)
|
|
(253
|
)
|
|
(232
|
)
|
|||
Total stock-based compensation, net of tax
|
$
|
670
|
|
|
$
|
547
|
|
|
$
|
480
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
VMware Stock Options
|
2020
|
|
2019
|
|
2018
|
||||||
Dividend yield
|
None
|
|
|
None
|
|
|
None
|
|
|||
Expected volatility
|
34.0
|
%
|
|
31.9
|
%
|
|
29.1
|
%
|
|||
Risk-free interest rate
|
1.5
|
%
|
|
2.9
|
%
|
|
1.7
|
%
|
|||
Expected term (in years)
|
2.7
|
|
|
3.2
|
|
|
3.3
|
|
|||
Weighted-average fair value at grant date
|
$
|
98.00
|
|
|
$
|
143.01
|
|
|
$
|
83.62
|
|
Pivotal Stock Options
|
|
|
|
|
|
||||||
Dividend yield
|
n/a
|
|
|
None
|
|
|
None
|
|
|||
Expected volatility
|
n/a
|
|
|
33.4
|
%
|
|
34.3
|
%
|
|||
Risk-free interest rate
|
n/a
|
|
|
2.8
|
%
|
|
2.0
|
%
|
|||
Expected term (in years)
|
n/a
|
|
|
6.08
|
|
|
6.08
|
|
|||
Weighted-average fair value at grant date
|
n/a
|
|
|
$
|
5.23
|
|
|
$
|
3.58
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
VMware Employee Stock Purchase Plan
|
2020
|
|
2019
|
|
2018
|
||||||
Dividend yield
|
None
|
|
|
None
|
|
|
None
|
|
|||
Expected volatility
|
27.4
|
%
|
|
33.5
|
%
|
|
22.6
|
%
|
|||
Risk-free interest rate
|
1.7
|
%
|
|
2.0
|
%
|
|
1.2
|
%
|
|||
Expected term (in years)
|
0.6
|
|
|
0.8
|
|
|
0.9
|
|
|||
Weighted-average fair value at grant date
|
$
|
35.66
|
|
|
$
|
34.72
|
|
|
$
|
21.93
|
|
|
Unrealized Gain (Loss) on
Available-for-Sale Securities |
|
Unrealized Gain (Loss) on
Forward Contracts |
|
Foreign Currency Translation Adjustments
|
|
Total
|
||||||||
Balance, February 2, 2018
|
$
|
(15
|
)
|
|
$
|
—
|
|
|
$
|
26
|
|
|
$
|
11
|
|
Adjustments related to adoption of ASU 2016-01 and 2018-02
|
(15
|
)
|
|
—
|
|
|
—
|
|
|
(15
|
)
|
||||
Unrealized gains (losses), net of tax (benefit) of $—, $—, $—, and $—
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
||||
Amounts reclassified from accumulated other comprehensive income (loss) to the consolidated statements of income, net of tax (provision) benefit of $10, $—, $— and $10
|
30
|
|
|
—
|
|
|
—
|
|
|
30
|
|
||||
Foreign currency translation adjustments
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
(26
|
)
|
||||
Other comprehensive income (loss), net
|
30
|
|
|
2
|
|
|
(26
|
)
|
|
6
|
|
||||
Less: Change in other comprehensive income (loss) attributable to non-controlling interests
|
—
|
|
|
—
|
|
|
4
|
|
|
4
|
|
||||
Balance, February 1, 2019
|
—
|
|
|
2
|
|
|
(4
|
)
|
|
(2
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income (loss) to the consolidated statements of income, net of tax (provision) benefit of $—, $—, $— and $—
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Other comprehensive income (loss), net
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
||||
Balance, January 31, 2020
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(4
|
)
|
|
$
|
(4
|
)
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
Revenue:
|
|
|
|
|
|
||||||
License
|
$
|
3,181
|
|
|
$
|
3,042
|
|
|
$
|
2,628
|
|
Subscription and SaaS
|
1,877
|
|
|
1,303
|
|
|
927
|
|
|||
Total license and subscription and SaaS
|
5,058
|
|
|
4,345
|
|
|
3,555
|
|
|||
Services:
|
|
|
|
|
|
||||||
Software maintenance
|
4,754
|
|
|
4,351
|
|
|
3,919
|
|
|||
Professional services
|
999
|
|
|
917
|
|
|
862
|
|
|||
Total services
|
5,753
|
|
|
5,268
|
|
|
4,781
|
|
|||
Total revenue
|
$
|
10,811
|
|
|
$
|
9,613
|
|
|
$
|
8,336
|
|
|
For the Year Ended
|
||||||||||
|
January 31,
|
|
February 1,
|
|
February 2,
|
||||||
|
2020
|
|
2019
|
|
2018
|
||||||
United States
|
$
|
5,405
|
|
|
$
|
4,696
|
|
|
$
|
4,200
|
|
International
|
5,406
|
|
|
4,917
|
|
|
4,136
|
|
|||
Total
|
$
|
10,811
|
|
|
$
|
9,613
|
|
|
$
|
8,336
|
|
|
January 31,
|
|
February 1,
|
||||
|
2020
|
|
2019
|
||||
United States
|
$
|
860
|
|
|
$
|
849
|
|
International
|
209
|
|
|
113
|
|
||
Total
|
$
|
1,069
|
|
|
$
|
962
|
|
•
|
Software-Defined Data Center
|
•
|
Hybrid and Multi-Cloud Computing
|
•
|
Digital Workspace—End-User Computing
|
Fiscal 2020
|
Q1 2020(1)
|
|
Q2 2020(1)
|
|
Q3 2020(1)
|
|
Q4 2020
|
||||||||
Total revenue
|
$
|
2,450
|
|
|
$
|
2,632
|
|
|
$
|
2,656
|
|
|
$
|
3,073
|
|
Net income attributable to VMware, Inc.
|
380
|
|
|
5,303
|
|
|
407
|
|
|
321
|
|
||||
Net income per weighted-average share attributable to VMware, Inc. common stockholders, basic for Classes A and B
|
$
|
0.91
|
|
|
$
|
12.72
|
|
|
$
|
0.98
|
|
|
$
|
0.77
|
|
Net income per weighted-average share attributable to VMware, Inc. common stockholders, diluted for Classes A and B
|
$
|
0.89
|
|
|
$
|
12.47
|
|
|
$
|
0.96
|
|
|
$
|
0.76
|
|
Fiscal 2019
|
Q1 2019(1)
|
|
Q2 2019(1)
|
|
Q3 2019(1)
|
|
Q4 2019(1)
|
||||||||
Total revenue
|
$
|
2,159
|
|
|
$
|
2,332
|
|
|
$
|
2,363
|
|
|
$
|
2,759
|
|
Net income attributable to VMware, Inc.
|
299
|
|
|
433
|
|
|
422
|
|
|
496
|
|
||||
Net income per weighted-average share attributable to VMware, Inc. common stockholders, basic for Classes A and B
|
$
|
0.73
|
|
|
$
|
1.04
|
|
|
$
|
1.01
|
|
|
$
|
1.19
|
|
Net income per weighted-average share attributable to VMware, Inc. common stockholders, diluted for Classes A and B
|
$
|
0.71
|
|
|
$
|
1.03
|
|
|
$
|
1.00
|
|
|
$
|
1.17
|
|
ITEM 9.
|
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A.
|
CONTROLS AND PROCEDURES
|
ITEM 9B.
|
OTHER INFORMATION
|
ITEM 10.
|
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
|
ITEM 11.
|
EXECUTIVE COMPENSATION
|
ITEM 12.
|
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT, AND RELATED STOCKHOLDER MATTERS
|
ITEM 13.
|
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14.
|
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15.
|
EXHIBITS, FINANCIAL STATEMENT SCHEDULES
|
|
|
|
|
|
Incorporated by Reference
|
||||||
Exhibit
Number
|
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2.1
|
|
|
|
8-K
|
|
001-33622
|
|
2.1
|
|
8/22/19
|
|
2.2
|
|
|
|
8-K
|
|
001-33622
|
|
2.1
|
|
8/22/19
|
|
3.1
|
|
|
|
10-Q
|
|
001-33622
|
|
3.1
|
|
6/9/17
|
|
3.2
|
|
|
|
8-K
|
|
001-33622
|
|
3.1
|
|
2/23/17
|
|
4.1
|
|
|
|
S-1/A-4
|
|
333-142368
|
|
4.1
|
|
7/27/07
|
|
4.2
|
|
|
|
8-K
|
|
001-33622
|
|
4.1
|
|
8/21/17
|
|
4.3
|
|
|
|
8-K
|
|
001-33622
|
|
4.2
|
|
8/21/17
|
|
4.4
|
|
|
|
8-K
|
|
001-33622
|
|
4.3
|
|
8/21/17
|
|
4.5
|
|
|
|
8-K
|
|
001-33622
|
|
4.4
|
|
8/21/17
|
|
4.6*
|
|
|
|
|
|
|
|
|
|
|
|
10.1
|
|
|
|
10-K
|
|
001-33622
|
|
10.1
|
|
3/29/18
|
|
10.2
|
|
|
|
10-K
|
|
001-33622
|
|
10.2
|
|
3/29/19
|
|
10.3
|
|
|
|
8-K
|
|
001-33622
|
|
10.1
|
|
12/30/19
|
|
10.4
|
|
|
|
S-1/A-1
|
|
333-142368
|
|
10.4
|
|
6/11/07
|
|
10.5
|
|
|
|
10-Q
|
|
001-33622
|
|
10.5
|
|
11/9/15
|
|
10.6+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.6
|
|
9/9/19
|
|
10.7+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.7
|
|
6/9/17
|
|
10.8
|
|
|
|
10-K
|
|
001-33622
|
|
10.8
|
|
3/29/18
|
|
|
|
|
|
Incorporated by Reference
|
||||||
Exhibit
Number
|
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10.9+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.9
|
|
8/5/15
|
|
10.10+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.10
|
|
9/9/19
|
|
10.11+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.11
|
|
9/9/19
|
|
10.12+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.12
|
|
6/11/18
|
|
10.13
|
|
|
|
10-Q
|
|
001-33622
|
|
10.24
|
|
8/3/11
|
|
10.14
|
|
|
|
10-Q
|
|
001-33622
|
|
10.25
|
|
8/3/11
|
|
10.15
|
|
|
|
10-Q
|
|
001-33622
|
|
10.26
|
|
8/3/11
|
|
10.16+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.16
|
|
9/9/19
|
|
10.17+
|
|
|
|
10-K
|
|
001-33622
|
|
10.26
|
|
2/25/14
|
|
10.18*+
|
|
|
|
|
|
|
|
|
|
|
|
10.19
|
|
|
|
10-Q
|
|
001-33622
|
|
10.30
|
|
5/1/14
|
|
10.20
|
|
|
|
10-Q
|
|
001-33622
|
|
10.34
|
|
5/1/14
|
|
10.21+
|
|
|
|
10-Q
|
|
001-33622
|
|
10.22
|
|
12/10/18
|
|
10.22
|
|
|
|
8-K
|
|
001-33622
|
|
10.1
|
|
3/30/17
|
|
10.23
|
|
|
|
8-K
|
|
001-33622
|
|
10.1
|
|
7/2/18
|
|
10.24+
|
|
|
|
8-K
|
|
001-33622
|
|
99.1
|
|
9/18/18
|
|
10.25
|
|
|
|
8-K
|
|
001-33622
|
|
10.1
|
|
11/15/18
|
|
10.26
|
|
|
|
10-Q
|
|
001-33622
|
|
10.32
|
|
6/10/19
|
|
10.27
|
|
|
|
8-K
|
|
001-33622
|
|
10.1
|
|
8/22/19
|
|
10.28
|
|
|
|
8-K
|
|
001-33622
|
|
10.1
|
|
8/22/19
|
|
10.29
|
|
|
|
8-K
|
|
001-33622
|
|
10.2
|
|
8/22/19
|
|
21*
|
|
|
|
|
|
|
|
|
|
|
|
23*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
||||||
Exhibit
Number
|
|
Exhibit Description
|
|
Form
|
|
File No.
|
|
Exhibit
|
|
Filing Date
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31.1*
|
|
|
|
|
|
|
|
|
|
|
|
31.2*
|
|
|
|
|
|
|
|
|
|
|
|
32.1ǂ
|
|
|
|
|
|
|
|
|
|
|
|
32.2ǂ
|
|
|
|
|
|
|
|
|
|
|
|
101.INS*
|
|
|
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
|
|
|
|
|
101.SCH*
|
|
|
Inline XBRL Taxonomy Extension Schema
|
|
|
|
|
|
|
|
|
101.CAL*
|
|
|
Inline XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
|
|
|
|
|
101.DEF*
|
|
|
Inline XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
|
|
|
|
|
101.LAB*
|
|
|
Inline XBRL Taxonomy Extension Label Linkbase
|
|
|
|
|
|
|
|
|
101.PRE*
|
|
|
Inline XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
|
|
|
|
|
104
|
|
|
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document (included in Exhibit 101)
|
|
|
|
|
|
|
|
|
ITEM 16.
|
FORM 10-K SUMMARY
|
|
|
VMWARE, INC.
|
|
|
|
|
|
Dated:
|
March 26, 2020
|
By:
|
/s/ Patrick Gelsinger
|
|
|
|
Patrick Gelsinger
Chief Executive Officer
|
|
|
|
|
Dated:
|
March 26, 2020
|
By:
|
/s/ J. Andrew Munk
|
|
|
|
J. Andrew Munk
Chief Accounting Officer
(Principal Accounting Officer)
|
Date
|
|
Signature
|
|
Title
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Patrick Gelsinger
|
|
Chief Executive Officer and Director
(Principal Executive Officer)
|
|
|
Patrick Gelsinger
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Zane Rowe
|
|
Chief Financial Officer and Executive Vice President
(Principal Financial Officer)
|
|
|
Zane Rowe
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Michael Dell
|
|
Chairman
|
|
|
Michael Dell
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Anthony Bates
|
|
Director
|
|
|
Anthony Bates
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Marianne Brown
|
|
Director
|
|
|
Marianne Brown
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Michael Brown
|
|
Director
|
|
|
Michael Brown
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Donald Carty
|
|
Director
|
|
|
Donald Carty
|
|
|
|
|
|
|
|
|
|
|
|
Director
|
|
|
Egon Durban
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Karen Dykstra
|
|
Director
|
|
|
Karen Dykstra
|
|
|
|
|
|
|
|
March 26, 2020
|
|
/s/ Paul Sagan
|
|
Director
|
|
|
Paul Sagan
|
|
Tax Valuation Allowance
|
Balance at Beginning of Period
|
|
Tax Valuation Allowance Charged to Income Tax Provision
|
|
Tax Valuation Allowance Credited to Other Accounts
|
|
Tax Valuation Allowance Credited to Income Tax Provision
|
|
Balance at End of Period
|
||||||||||
Year ended January 31, 2020 income tax valuation allowance
|
$
|
283
|
|
|
$
|
89
|
|
|
$
|
—
|
|
|
$
|
(40
|
)
|
|
$
|
332
|
|
Year ended February 1, 2019 income tax valuation allowance
|
310
|
|
|
65
|
|
|
(32
|
)
|
|
(60
|
)
|
|
283
|
|
|||||
Year ended February 2, 2018 income tax valuation allowance
|
253
|
|
|
99
|
|
|
—
|
|
|
(42
|
)
|
|
310
|
|
•
|
the division of the Board into three classes, with each class serving for a staggered three-year term, which prevents stockholders from electing an entirely new board of directors at any annual meeting;
|
•
|
the right of the Board to elect a director to fill a vacancy created by an expansion of the Board;
|
•
|
following a distribution by Dell to its stockholders under Section 355 of the Internal Revenue Code of 1986, the restriction that a beneficial owner of 10% or more of the Class B Common Stock may not vote in any election of directors unless such person or group also owns at least an equivalent percentage of Class A Common Stock or obtains approval of the Board prior to acquiring beneficial ownership of at least 5% of Class B Common Stock;
|
•
|
the prohibition of cumulative voting in the election of directors or any other matters, which would otherwise allow less than a majority of stockholders to elect director candidates;
|
•
|
the requirement for advance notice for nominations for election to the Board or for proposing matters that can be acted upon at a stockholders’ meeting;
|
•
|
the ability of the Board to issue, without stockholder approval, up to 100,000,000 shares of Preferred Stock with terms set by the Board, which rights could be senior to those of Common Stock, as described above; and
|
•
|
in the event that Dell or its successor-in-interest no longer owns shares of Common Stock representing at least a majority of the votes entitled to be cast in the election of directors, stockholders may not act by written consent and may not call special meetings of the stockholders.
|
•
|
prior to this time, the Board approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder;
|
•
|
upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the Company outstanding at the time the transaction commenced, excluding shares owned by persons who are directors and also officers, and by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or
|
•
|
at or subsequent to such time, the business combination is approved by the Board and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66-2⁄3% of the outstanding voting stock that is not owned by the interested stockholder.
|
•
|
any merger or consolidation involving the Company and the interested stockholder;
|
•
|
any sale, transfer, pledge or other disposition of 10% or more of the assets of the Company involving the interested stockholder;
|
•
|
any transaction that results in the issuance or transfer by the Company of any stock of the Company to the interested stockholder, subject to limited exceptions;
|
•
|
any transaction involving the Company that has the effect of increasing the proportionate share of the stock of any class or series of the Company beneficially owned by the interested stockholder; or
|
•
|
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the Company.
|
•
|
adopt or implement any stockholder rights plan or similar takeover defense measure;
|
•
|
consolidate or merge with or into any Person (as defined in the Amended and Restated Certificate of Incorporation);
|
•
|
permit any subsidiary of the Company to consolidate or merge with or into any Person, except as set forth in the Amended and Restated Certificate of Incorporation;
|
•
|
issue any stock or any stock equivalents, except as set forth in the Amended and Restated Certificate of Incorporation;
|
•
|
dissolve, liquidate or wind up the Company; and
|
•
|
undertake certain other actions.
|
1.01
|
Preamble
|
1
|
1.02
|
Plan
|
1
|
1.03
|
Plan Sponsor
|
1
|
1.04
|
Employer
|
2
|
1.05
|
Administrator
|
2
|
1.06
|
Key Employee Determination Dates
|
2
|
2.01
|
Participation
|
3
|
3.01
|
Compensation
|
4
|
3.02
|
Bonuses
|
5
|
4.01
|
Participant Contributions
|
6
|
5.01
|
Employer Contributions
|
9
|
6.01
|
Distributions
|
12
|
7.01
|
Vesting
|
16
|
8.01
|
Unforeseeable Emergency
|
20
|
9.01
|
Investment Decisions
|
21
|
10.01
|
Trust
|
22
|
11.01
|
Termination Upon Change In Control
|
23
|
11.02
|
Automatic Distribution Upon Change In Control
|
23
|
11.03
|
Change In Control
|
23
|
12.01
|
Governing State Law
|
24
|
Appendix A
|
26
|
(a)
|
¨ adopts a new plan as of [month, day, year]
|
(b)
|
x amends and restates its existing plan as of January 1, 2020 which is the Amendment Restatement Date. Except as otherwise provided in Appendix A, all amounts deferred under the Plan prior to the Amendment Restatement Date shall be governed by the terms of the Plan as in effect on the day before the Amendment Restatement Date.
|
Plan Name:
|
VMware, Inc. Non-Qualified Deferred Compensation Plan
|
Plan Year:
|
Year ending December 31
|
Name:
|
VMware, Inc.
|
Mailing Address:
|
3401 Hillview Avenue, Palo Alto, CA 94034
|
Physical Address:
|
900 Arastradero Road, Building C, Palo Alto, CA 94034
|
Phone #:
|
650-427-4361
|
EIN #:
|
94-3292913
|
Fiscal Year:
|
Year ending December 31
|
Entity
|
Publicly Traded on Est. Securities Market
|
|
|
Yes
|
No
|
Pivotal Software, Inc. (EIN 94-3094578)
|
¨
|
x
|
|
¨
|
¨
|
|
¨
|
¨
|
|
¨
|
¨
|
|
¨
|
¨
|
|
¨
|
¨
|
|
¨
|
¨
|
Name:
|
Persons delegated authority by the Compensation & Corporate Governance Committee
|
Address:
|
|
(a)
|
x Employees [complete (i), (ii) or (iii)]
|
(i)
|
x Eligible Employees are selected by the Employer.
|
(ii)
|
¨ Eligible Employees are those employees of the Employer who satisfy the following criteria:
|
|
|
|
|
|
(iii)
|
¨ Employees are not eligible to participate.
|
(b)
|
x Directors [complete (i), (ii) or (iii)]
|
(i)
|
¨ All Directors are eligible to participate.
|
(ii)
|
¨ Only Directors selected by the Employer are eligible to participate.
|
(iii)
|
x Directors are not eligible to participate.
|
(a)
|
x Compensation is defined as:
|
Base Salary, Employee Bonus Plan, Executive Bonus Plan and Commissions
|
|
|
|
|
|
(b)
|
¨ Compensation as defined in [insert name of qualified plan] without regard to the limitation in Section 401(a)(17) of the Code for such Plan Year.
|
(c)
|
¨ Director Compensation is defined as:
|
|
|
|
(d)
|
¨ Compensation shall, for all Plan purposes, be limited to $ .
|
(e)
|
¨ Not Applicable.
|
Type
|
[Will be treated as]
Performance Based Compensation |
|
|
Yes
|
No
|
Employee Bonus Plan
|
¨
|
x
|
Executive Bonus Plan
|
¨
|
x
|
|
¨
|
¨
|
|
¨
|
¨
|
|
¨
|
¨
|
(a)
|
Amount of Deferrals
|
(i)
|
Compensation other than Bonuses [do not complete if you complete (iii)]
|
Type of Remuneration
|
Dollar Amount
|
% Amount
|
Increment
|
||
Min
|
Max
|
Min
|
Max
|
|
|
Base Salary
|
|
|
5%
|
75%
|
1%
|
Commissions
|
|
|
5%
|
100%
|
1%
|
|
|
|
%
|
%
|
%
|
(ii)
|
Bonuses [do not complete if you complete (iii)]
|
Type of Bonus
|
Dollar Amount
|
% Amount
|
Increment
|
||
Min
|
Max
|
Min
|
Max
|
|
|
Employee Bonus Plan
|
|
|
5%
|
100%
|
1%
|
Executive Bonus Plan
|
|
|
5%
|
100%
|
1%
|
|
|
|
%
|
%
|
%
|
(iii)
|
Compensation [do not complete if you completed (i) and (ii)]
|
Dollar Amount
|
% Amount
|
Increment
|
||
Min
|
Max
|
Min
|
Max
|
|
|
|
%
|
%
|
%
|
(iv)
|
Director Compensation
|
Type of Compensation
|
Dollar Amount
|
% Amount
|
Increment
|
||
Min
|
Max
|
Min
|
Max
|
|
|
Annual Retainer
|
|
|
%
|
%
|
%
|
Meeting Fees Other:
|
|
|
%
|
%
|
%
|
Other:
|
|
|
%
|
%
|
%
|
Other:
|
|
|
%
|
%
|
%
|
(b)
|
Election Period
|
(i)
|
Performance Based Compensation
|
¨
|
Does
|
x
|
Does Not
|
(ii)
|
Newly Eligible Participants
|
x
|
May
|
¨
|
May Not
|
(c)
|
Revocation of Deferral Agreement
|
x
|
Will
|
¨
|
Will Not
|
(d)
|
No Participant Contributions
|
(i)
|
Amount
|
(A)
|
¨ [insert percentage]% of the Compensation the Participant has elected to defer for the Plan Year
|
(B)
|
x An amount determined by the Employer in its sole discretion
|
(C)
|
¨ Matching contributions for each Participant shall be limited to $ and/or [insert percentage]% of Compensation
|
(D)
|
¨ Other:
|
|
|
(E)
|
¨ Not Applicable [Proceed to Section 5.01(b)]
|
(ii)
|
Eligibility for matching contribution
|
(A)
|
¨ Describe requirements:
|
|
|
(B)
|
x Is selected by the Employer in its sole discretion to receive an allocation of matching contributions
|
(C)
|
¨ No requirements
|
(iii)
|
Time of Allocation
|
(A)
|
¨ As of the last day of the Plan Year
|
(B)
|
x At such times as the Employer shall determine in its sole discretion
|
(C)
|
¨ At the time the Compensation on account of which the matching contribution is being made would otherwise have been paid to the Participant
|
(D)
|
¨ Other:
|
|
|
(i)
|
Amount
|
(A)
|
¨ An amount equal to [insert percentage]% of the Participant’s Compensation
|
(B)
|
x An amount determined by the Employer in its sole discretion
|
(C)
|
¨ Contributions for each Participant shall be limited to $
|
(D)
|
¨ Other:
|
|
|
(E)
|
¨ Not Applicable [Proceed to Section 6.01]
|
(ii)
|
Eligibility for Other Contribution
|
(A)
|
¨ Describe requirements:
|
|
|
(B)
|
x Is selected by the Employer in its sole discretion to receive an allocation of other Employer contributions
|
(C)
|
¨ No requirements
|
(iii)
|
Time of Allocation
|
(A)
|
¨ As of the last day of the Plan Year
|
(B)
|
x At such times or times as the Employer shall determine in its sole discretion
|
(C)
|
¨ Other:
|
|
|
(a)
|
Timing of Distributions
|
(i)
|
All distributions shall commence in accordance with the following [choose one]:
|
(A)
|
¨ As soon as administratively feasible following the distribution event but in no event later than the time prescribed by Treas. Reg. Sec. 1.409A-3(d).
|
(B)
|
¨ Monthly on specified day [insert day]
|
(C)
|
¨ Annually on specified month and day [insert month and day]
|
(D)
|
x Calendar quarter on specified month and day 1st business day of 1st month of quarter;
|
(ii)
|
The timing of distributions as determined in Section 6.01(a)(i) shall be modified by the adoption of:
|
(A)
|
x Event Delay – Distribution events other than those based on Specified Date or Specified Age will be treated as not having occurred for six (6) months
|
(B)
|
¨ Hold Until Next Year – Distribution events other than those based on Specified Date or Specified Age will be treated as not having occurred for twelve months from the date of the event if payment pursuant to Section 6.01(a)(i) will thereby occur in the next calendar year or on the first payment date in the next calendar year in all other cases
|
(C)
|
¨ Immediate Processing – The timing method selected by the Plan Sponsor under Section 6.01(a)(i) shall be overridden for the following distribution events [insert events]:
|
|
|
(D)
|
¨ Not applicable
|
(b)
|
Distribution Events
|
|
Lump Sum
|
Installments
|
|
|
|
(i) x Specified Date
|
x
|
5, 11 or 15 years
|
|
|
|
(ii) ¨ Specified Age
|
¨
|
years
|
|
|
|
(iii) x Separation from Service
|
x
|
5, 11 or 15 years
|
|
|
|
(iv) ¨ Separation from Service plus 6 months
|
¨
|
years
|
|
|
|
(v) ¨ Separation from Service plus months [not to exceed months]
|
¨
|
years
|
|
|
|
(vi) ¨ Retirement
|
¨
|
years
|
|
|
|
(vii) ¨ Retirement plus 6 months
|
¨
|
years
|
|
|
|
(viii) ¨ Retirement plus months
|
¨
|
years
|
|
|
|
(ix) ¨ Disability
|
¨
|
years
|
|
|
|
(x) ¨ Death
|
¨
|
years
|
|
|
|
(xi) ¨ Change in Control
|
¨
|
years
|
(c)
|
Specified Date and Specified Age elections may not extend beyond age Not applicable.
|
(d)
|
Payment Election Override
|
Events
|
Form of Payment
|
|
|
Lump Sum
|
Installments
|
|
|
|
¨ Separation from Service
|
¨
|
_____
|
|
|
|
¨ Separation from Service before Retirement
|
¨
|
_____
|
|
|
|
x Death
|
x
|
_____
|
|
|
|
x Disability
|
x
|
_____
|
|
|
|
¨ Not Applicable
|
¨
|
_____
|
(e)
|
Involuntary Cashouts
|
x
|
If the Participant’s vested Account at the time of his Separation from Service does not exceed $50,000, distribution of the vested Account shall automatically be made in the form of a single lump sum in accordance with Section 9.5 of the Plan.
|
¨
|
There are no involuntary cashouts.
|
(f)
|
Retirement
|
¨
|
Retirement shall be defined as a Separation from Service that occurs on or after the Participant [insert description of requirements]:
|
|
|
x
|
No special definition of Retirement applies.
|
(g)
|
Distribution Election Change
|
x
|
Shall
|
¨
|
Shall Not
|
(h)
|
Frequency of Elections
|
x
|
Has
|
¨
|
Has Not
|
(a)
|
Matching Contributions
|
¨
|
Years of Service
|
Vesting %
|
|
|
|
|
|
|
0
|
%
|
[insert “100” if there is immediate vesting]
|
|
|
|
|
|
1
|
%
|
|
|
|
|
|
|
2
|
%
|
|
|
|
|
|
|
3
|
%
|
|
|
|
|
|
|
4
|
%
|
|
|
|
|
|
|
5
|
%
|
|
|
|
|
|
|
6
|
%
|
|
|
|
|
|
|
7
|
%
|
|
|
|
|
|
|
8
|
%
|
|
|
|
|
|
|
9
|
%
|
|
x
|
Other:
|
As determined by the Administrator
|
|
¨
|
Class year vesting applies:
|
|
¨
|
Not applicable.
|
(b)
|
Other Employer Contributions
|
¨
|
Years of Service
|
Vesting %
|
|
|
|
|
|
|
0
|
%
|
[insert “100” if there is immediate vesting]
|
|
|
|
|
|
1
|
%
|
|
|
|
|
|
|
2
|
%
|
|
|
|
|
|
|
3
|
%
|
|
|
|
|
|
|
4
|
%
|
|
|
|
|
|
|
5
|
%
|
|
|
|
|
|
|
6
|
%
|
|
|
|
|
|
|
7
|
%
|
|
|
|
|
|
|
8
|
%
|
|
|
|
|
|
|
9
|
%
|
|
x
|
Other:
|
As determined by the Administrator
|
|
¨
|
Class year vesting applies:
|
|
¨
|
Not applicable.
|
(c)
|
Acceleration of Vesting
|
(i)
|
¨ Death.
|
(ii)
|
¨ Disability.
|
(iii)
|
¨ Change in Control.
|
(iv)
|
¨ Eligibility for Retirement.
|
(v)
|
x Other:
|
As determined by the Administrator
|
|
(vi)
|
¨ Not applicable.
|
(d)
|
Years of Service
|
(i)
|
A Participant’s Years of Service shall include all service performed for the Employer and
|
¨
|
Shall
|
x
|
Shall Not
|
(ii)
|
Years of Service shall also include service performed for the following entities:
|
|
|
|
|
|
(iii)
|
Years of Service shall be determined in accordance with [select one]:
|
(A)
|
¨ The elapsed time method in Treas. Reg. Sec. 1.410(a)-7
|
(B)
|
¨ The general method in DOL Reg. Sec. 2530.200b-1 through b-4
|
(C)
|
¨ Participant’s Years of Service credited under:
|
[insert name of plan]
|
(D)
|
x Other:
|
As determined by the Administrator
|
|
|
|
(iv)
|
¨ Not applicable.
|
(a)
|
A withdrawal due to an Unforeseeable Emergency as defined in Section 2.24:
|
x
|
Will
|
¨
|
Will Not [if Unforeseeable Emergency withdrawals are not permitted, proceed to Section 9.01]
|
(b)
|
Upon a withdrawal due to an Unforeseeable Emergency, a Participant’s deferral election for the remainder of the Plan Year:
|
x
|
Will
|
¨
|
Will Not
|
(a)
|
x The Participant or his Beneficiary
|
(b)
|
¨ The Employer
|
(a)
|
x A change in the ownership of the Employer as described in Section 9.7(c) of the Plan.
|
(b)
|
x A change in the effective control of the Employer as described in Section 9.7(d) of the Plan.
|
(c)
|
x A change in the ownership of a substantial portion of the assets of the Employer as described in Section 9.7(e) of the Plan.
|
(d)
|
¨ Not Applicable.
|
Plan Sponsor:
|
VMware, Inc.
|
By:
|
/s/ Shannon Daly
|
Title:
|
Senior Director, Global Benefits
|
SUBSIDIARIES
|
|
STATE OR OTHER JURISDICTION OF
INCORPORATION OR ORGANIZATION
|
3401 Hillview LLC
|
|
Delaware
|
A.W.S. Holding, LLC
|
|
Delaware
|
AetherPal (INDIA) Private Limited
|
|
India
|
AetherPal LLC
|
|
Delaware
|
AirWatch LLC
|
|
Delaware
|
Arkinnet Software Private Limited
|
|
India
|
Avi Networks B.V.
|
|
Netherlands
|
Avi Networks Germany GmbH
|
|
Germany
|
Avi Networks India Private Limited
|
|
India
|
Avi Networks International, Inc.
|
|
Delaware
|
Avi Networks Middle East, FZ-LLC
|
|
Dubai
|
Avi Networks UK Limited
|
|
United Kingdom
|
Avi Networks, LLC
|
|
Delaware
|
Bitfusion.io Inc.
|
|
Delaware
|
BitRock, Inc.
|
|
Delaware
|
BitRock, S.L.
|
|
Spain
|
Carbon Black Australia Pty. Ltd.
|
|
Australia
|
Carbon Black Germany GmbH
|
|
Germany
|
Carbon Black Malaysia SDN. BHD
|
|
Malaysia
|
Carbon Black U.K. Limited
|
|
United Kingdom
|
Carbon Black, LLC
|
|
Delaware
|
CloudHealth Technologies Australia Pty. Ltd
|
|
Australia
|
CloudHealth Technologies, LLC
|
|
Delaware
|
GoPivotal (UK) Limited
|
|
United Kingdom
|
GoPivotal Netherlands B.V.
|
|
Netherlands
|
GoPivotal Singapore Pte. Limited
|
|
Singapore
|
GoPivotal Software India Private Limited
|
|
India
|
GPVTL Canada Inc.
|
|
Canada
|
Heptio LLC
|
|
Delaware
|
Nicira, Inc.
|
|
Delaware
|
Nyansa, Inc.
|
|
Delaware
|
Pivotal Brasil Consultoria em Technologia da Informacao Ltda.
|
|
Brazil
|
Pivotal Group 1 Limited
|
|
Bermuda
|
Pivotal Group 2
|
|
Bermuda
|
Pivotal Japan K.K.
|
|
Japan
|
Pivotal Labs Sydney Pty Ltd
|
|
Australia
|
Pivotal Software Australia Pty Limited
|
|
Australia
|
Pivotal Software Deutschland GmbH
|
|
Germany
|
Pivotal Software France S.A.S.
|
|
France
|
Pivotal Software International Limited
|
|
Ireland
|
Pivotal Software International Holdings
|
|
Ireland
|
Pivotal Software Korea Ltd.
|
|
Korea
|
Pivotal Software, Inc.
|
|
Delaware
|
Pivotal Technology (Beijing) Co., Ltd.
|
|
China
|
PT VMware Software Indonesia
|
|
Indonesia
|
Taiwan VMware Information Technology LLC
|
|
Taiwan
|
Uhana, LLC
|
|
Delaware
|
V M WARE EGYPT
|
|
Egypt
|
VeloCloud Networks Private Limited
|
|
India
|
Velocloud Networks, LLC
|
|
Delaware
|
Veriflow Systems, Inc.
|
|
Delaware
|
VMware Argentina S.R.L.
|
|
Argentina
|
VMware Australia Pty Ltd
|
|
Australia
|
VMware Belgium
|
|
Belgium
|
VMware Bermuda Unlimited
|
|
Ireland
|
VMware Bulgaria EOOD
|
|
Bulgaria
|
VMware Canada ULC
|
|
Canada
|
VMware Chile SpA
|
|
Chile
|
VMware Colombia SAS
|
|
Colombia
|
VMware Costa Rica Ltda.
|
|
Costa Rica
|
VMware Denmark ApS
|
|
Denmark
|
VMware Eastern Europe
|
|
Armenia
|
VMware France SAS
|
|
France
|
VMware Global, Inc.
|
|
Delaware
|
VMware Hong Kong Limited
|
|
Hong Kong
|
VMware Information Technology (China) Co. Ltd
|
|
China
|
VMware International Marketing Limited
|
|
Ireland
|
VMware International Spain, S.L.
|
|
Spain
|
VMware International Unlimited
|
|
Ireland
|
VMware Israel Ltd.
|
|
Israel
|
VMware Italy S.r.l.
|
|
Italy
|
VMware Korea Co., Ltd.
|
|
South Korea
|
VMware Malaysia SDN. BHD.
|
|
Malaysia
|
VMware Marketing Austria GmbH
|
|
Austria
|
VMware Mexico S. de R.L. de C.V.
|
|
Mexico
|
VMware Middle East FZ-LLC
|
|
Dubai
|
VMware Netherlands B.V.
|
|
Netherlands
|
VMware Norway AS
|
|
Norway
|
VMware NZ Company
|
|
New Zealand
|
VMware Poland sp. Z.o.o.
|
|
Poland
|
VMware Rus LLC
|
|
Russia
|
VMware Saudi Limited
|
|
Saudi Arabia
|
VMware Singapore Pte. Ltd.
|
|
Singapore
|
VMware Software e Serviços Brasil Ltda.
|
|
Brazil
|
VMware Software India Private Limited
|
|
India
|
VMware South Africa (Pty) Ltd
|
|
South Africa
|
VMware Spain, S.L.
|
|
Spain
|
VMware Sweden AB
|
|
Sweden
|
VMware Switzerland GmbH
|
|
Switzerland
|
VMware (Thailand) Co., Ltd.
|
|
Thailand
|
VMware Turkey Software Solutions and Services Company Limited
|
|
Turkey
|
VMware UK Limited
|
|
United Kingdom
|
VMware, K.K.
|
|
Japan
|
1.
|
I have reviewed this annual report on Form 10-K of VMware, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
March 26, 2020
|
By:
|
|
/s/ Patrick Gelsinger
|
|
|
|
|
Patrick Gelsinger
Chief Executive Officer
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of VMware, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
March 26, 2020
|
By:
|
|
/s/ Zane Rowe
|
|
|
|
|
Zane Rowe
Chief Financial Officer and Executive Vice President
(Principal Financial Officer)
|
Date:
|
March 26, 2020
|
By:
|
|
/s/ Patrick Gelsinger
|
|
|
|
|
Patrick Gelsinger
Chief Executive Officer
(Principal Executive Officer)
|
Date:
|
March 26, 2020
|
By:
|
|
/s/ Zane Rowe
|
|
|
|
|
Zane Rowe
Chief Financial Officer and Executive Vice President
(Principal Financial Officer)
|